Lloyds Banking Group said on Wednesday that it is in a very good position to strengthen its capital position as demanded by the U. K. regulator. It said that it is confident to meet capital requirement without issuing new shares or being forced to convert bonds into shares.

The Prudential Regulation Authority is a successor to the Financial Services Authority. It is in talks with all U. K. banks after the Bank of England's Financial Policy Committee estimated £25 billion ($37.9 billion) capital shortfall across the sector.

Lloyds, however, did not disclose the size of the shortfall determined by the PRA. The announcement by 39% state-owned Lloyds was the first by a U. K. bank as part of the regulator's review. More announcements are expected in the coming days.

"These additional capital requirements are expected to be met without recourse to further equity issuance or the utilization of additional contingent-capital securities", Lloyds said.

The bank added that it is certain about its capital position and reiterated that its Core Tier 1 will remain above 9% at the end of this year and above 10% by the end of 2014.

Lloyds Chief Executive Antonio Horta-Osorio said during an annual shareholder meeting last week that he expected the bank to post a profit this year and increase lending despite a subdued economy.