Last month, the British bank posted a Â£6.3 billion ($9.6 billion) loss in its results for 2009, only a minor improvement on the Â£6.7 billion deficit of 2008.
When announcing the company's annual results, chief executive officer Eric Daniels said he expected a "slow, below trend, economic recovery", while also stating that Lloyds is successfully addressing its short-term challenges.
But the firm, which is 41 per cent owned by the British government, has now published a more bullish statement predicting a return to profit this year.
"[The bank] will be profitable on a combined businesses basis in 2010," the company said. "The group now expects to deliver a better impairment performance â¦ in both the retail and corporate businesses".
Shares in Lloyds have gone up eight per cent in reaction to the publication of the statement, reports Bloomberg.
By Asim Shah