The bonus pay cuts could affect 60,000 staff of the British bank, all the way up to CEO António Horta-Osório, according to the report.
The bank has seen a surge in payment protection insurance claims — plans providing coverage for loan payments in the event of sudden unemployment or disability — amounting to the equivalent of $2.35 billion since October, according to the report.
That hit plus other factors mean the committee that allots the total given in employee bonuses is likely to shrink the pot for the first time since 2016, according to the report. Last year, the bank set aside the equivalent of $606.85 million for bonuses.
Two unions for Lloyds employees have already warned their members to expect smaller bonuses this year.
"[Lloyds] has made it clear that group performance share (bonus) awards in March are likely to be lower than last year," the union Accord wrote in a December newsletter.
Still, the cuts haven't been finalized. The bank told The Guardian that "no decisions have been made. As usual, all decisions on remuneration will be taken by the remuneration committee as part of the annual process."