LLOYDS BANKING GROUP AT A GLANCE (1/2)

RECENT PRESS & AWARDS KEY FACTS & OPERATIONAL PERFORMANCE

Full Year 2015

CET-1 13.0%

CIR 49% Euromoney 2015 Awards Business Product Bank of the Year 2015 EMEA Structured for Operational Excellence Innovation of Finance House of Leverage Ratio ~5% the Year 2015 the Year Ratings (LT) Moody's S&P Fitch

Lloyds Bank Plc A1 A A+ Business Bank of the Best Bank for Cash Best Developed Year 2005 - 2015 Management in th UK 2016 Markets Bank 2015 Börsen-Zeitung excerpt, January 22nd 2016 LOW RISK BUSINESS MODEL & PRUDENT RISK APPROACH(1) Ranking Institution Market Cap Change vs. 31.12.2015 30.06.2015 31.12.2015* 30.06.2015° in bps CDS 5 year evolution from 2013 until today among UK peers 1 1 HSBC 143,23 -5,1 2 3 70,85 -14,3 240 3 4 UBS 67,77 0,9 4 2 65,57 -26,8 5 5 BNP Paribas 64,99 -3,4 200 Standard 6 10 51,6 -4,8 Chartered Bank 7 6 49,9 -15,8 8 8 ING 48,16 -15,9 160 The Royal Bank of 9 7 Royal Bank of 47,53 -13,7 Scotland PLC 10 9 BBVA 42,71 -22,9 11 11 Bank 40,9 -9,8 120 Barclays Bank PLC 12 13 Credit Suisse 39,13 0,8 HSBC Bank PLC 13 18 Société Générale 33,91 1,7 14 14 31,05 -16,5 80 Lloyds Bank PLC 15 16 30,66 -14,8 16 17 Crédit Agricole 28,67 -18,5 17 20 Sberbank of Russia 27,3 40 40 18 15 25,06 -26,8 19 19 24,34 -6,8 20 22 KBC 24,11 -3,7 12/2014 12/2015 04/2016 *) in EURbn °) in % - Source: SNL Financial

(1) Source: Bloomberg as of April 1st, 2016 2 AT A GLANCE (2/2)

RETAIL BANKING COMMERCIAL BANKING CONSUMER FINANCE INSURANCE

Banking >80% UK’s top fleet 3.7m home >30m UK Customers of the FTSE 100 management provider insurance customers

BRANDS BRANDS

Total Income: £8,519m Total Income: £4,576m Total Income: £2,645m Total Income: £1,664m Underlying Profit: £3,514m Underlying Profit: £2,431m Underlying Profit: £1,005m Underlying Profit: £962m

Customer Deposits: £279.5bn Customer Deposits: £126.1bn Customer Deposits: £11.1bn KPI 2015 KPI

Halifax Lloyds Bank Lex Autolease Scottish Widows . Helped with purchase of over . UK Business Bank of the Year . >40,000 customers - 290,000 . Operating since 1815 130,000 homes in the UK (1 in for 11 consecutive years unit vehicle fleet . Over 6m people hold a Scottish

10) in 2014 . Financial Markets . Responsible for 1 in 28 of the Widows manufactured product . Capital Markets UK’s new car vehicles registered . Pension Services . Global Transaction Banking . Second oldest bank in the UK Blackhorse Colleys

KEY FACTS KEY LDC . Network of 5,000 motor dealers . Largest property valuation and Lloyds Bank . Leading Mid Market Private . Financing 1m customers, worth surveying business in the UK . >1,000 branches across the UK Equity House in the UK £ 1.7bn per annum . 430,000 instructions in 2014 . 250 years of history

3 Die Kapitalstruktur wird zunehmend zu einer kritischen Steuerungsgröße für das Risikomanagement eines Unternehmens

Christian Leibl

Managing Director, Head of Capital Structure Advisory, Lloyds Bank UNTERNEHMENSPLANUNG

Traditioneller Ansatz

Ziel-

erreichung

Wertschöpfung Heutige Position

Zeit

5 “EVENTS”-MANAGEMENT WIRD IMMER WICHTIGER

Vom traditionellen Risikomanagement… …zu (un)erwarteten Events

Öl-Preis*

160 140 120 100 80 60 40 20 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Marktvolatilität – Zinsen, FX, Rohstoffe etc. Preisverfall nur der Anfang? … Regulatorisches Umfeld

Politische Lage – Brexit Referendum, Wahlen in USA

Wirtschaftslage in

*Brent Crude (Denominierung: USD) 6 Quelle: Bloomberg UNTERNEHMENSPLANUNG

Was nun?

Ziel-

erreichung

Wertschöpfung Heutige Position

Zeit

7 UNTERNEHMENSPLANUNG

Neuer Ansatz gefragt

??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ???

Wertschöpfung ??? Heutige Position ??? Mit wem?

Zeit

8 FLEXIBILITÄT IST WICHTIGER DENN JE

??? ??? ??? ??? ??? ??? Worauf kommt’s an? ???

“Be prepared…” “Be quick…” ??? ??? ??? ??? Bewusstsein + “Big Data” = Umsetzung Wertschöpfung ??? Current Position ??? Agilität

Zeit

9 DIE ROLLE DES TREASURY

“Das Treasury ist eine der wenigen Unternehmensfunktionen, die neben dem Vorstand das Unternehmen aus der Vogelperspektive sehen.”

Unterstützen Sie den Vorstand dabei systematische Risiken (besser) zu verstehen, fördern Sie die Zusammenarbeit mit anderen Bereichen und steigern Sie dadurch die Wertschöpfung

…verstehen… …analysieren… …entscheiden…

MARKTUMFELD GESCHÄFTSMODELL RISIKOMANAGEMENT

Währungen, Zinsen, Volatilität der Stärken und Schwächen der KPIs, Reaktionszeit, Berichterstattung Wettbewerbsposition Risikobereitschaft

10 KAPITALSTRUKTUR – WAS SOLL OPTIMIERT WERDEN?

Barmittel Verschuldungsgrad Kredit-Rating

3.8x 3.6x Investment Grade Sub-IG 3.5x Ø Rating Ø Rating

2.9x Vor 15 heute

Jahren

2.3bn

€

1.7bn

€

1.2bn €

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Flexibilität Kapitalquellen Liquidität

Airbag gegen “Events” – operativ & Zugriff auf unterschiedliche Free Cash Flow, Kreditlinien, finanziell Finanzierungsvarianten Barmittel

Note: (1) Verschuldung = Total Debt / EBITDA (2) Barmittel (kumulativ) und durschnittl. Verschuldungsgrad basieren auf 1842 von S&P gerateten Unternehmen in Europa und den USA (Ratings: AAA to -) 11 Quelle: S&P Capital IQ AKTUELLE REAKTIONEN AUF “EVENTS”

Beispiel: Rohstoff-Sektor

Aktienrückkäufe & Investitionen Anlagenverkäufe Dividenden Weiteres

USD 3 – 5bn USD 2 – 3bn Unverändert bp (per year to 2017) (ongoing basis)

30% USD 30bn Unverändert USD 25bn (Shell-BG in FY16) (over next 3 years) (2017 – 2020)

25% Erhöht (FY16 vs. FY15) (Up 6.7% in FY15)

24% USD 5 – 10bn Erhöht Beendet (FY16 vs. FY15) (over next 2 years) (FY15 vs. FY14)  (in FY15)

Glencore USD 0.5 – 1bn USD 4- 5bn Ausgesetzt USD 2.5bn Kapitalerh. (FY16 vs. FY15) (over next 1 to 2 years)  (FY15 and H1 16)  (in FY15)

Note: Ölpreis Entwicklung im Hintergrund zeigt den Zeitraum vom 01.01.2012 bis zum 27.04.2016 12 Quelle: Bloomberg, S&P Capital IQ, Ad-Hoc Meldungen der Unternehmen, Unternehmensreporte, O&G Journal DIE OPTIMALE KAPITALSTRUKTUR

“Es gibt keine magische Zahl…Das Geschäftsmodell is der Schlüssel.”

Beispiel: 3.0x Debt / EBITDA1

Unternehmen Heineken N.V. Holcim Ltd.

Kredit Rating A- / A3 / A BBB+ / Baa1 / NR BBB / Baa2 / BBB BBB- / Baa3 / NR BB+ / Ba1 / NR (S&P / Moody’s / Fitch)

Geschäfts- ‘Strong’ ‘Strong’ ‘Strong’ ‘Satisfactory’ ‘Satisfactory’ profil2 (A) (A) (A) (BBB) (BBB)

Industrie Pharma Konsumgüter Baustoffe Medien Rohstoffe

Note: (1) As at 31st December 2014; S&P; figure is rounded (2) As per S&P’s classification 13 Quelle: S&P, Moody’s, Fitch AUF, ZU NEUEN “EVENTS”!

 Kapitalstruktur als Risiko Management-Tool

 Zusammenarbeit: Unternehmensbereiche bilden Ökosystem

 Entscheidung: Risikoabsicherung vs. Risikoakzeptanz

 Unternehmerisches Lebenselexir: Liquidität

14 IMPORTANT NOTICE

This presentation, its contents and any related communication (altogether, the “Presentation”): (i) does not constitute or form part of any offer to sell or an invitation to subscribe for, hold or purchase any securities or any other investment; (ii) shall not form the basis of or be relied on in connection with any transaction, contract or commitment whatsoever; (iii) is provided for information purposes only and is not intended to form, and should not form, the basis of any investment decision; (iv) is not and should not be treated as investment research, a research recommendation, an opinion or advice; (v) is confidential and has been prepared by, and is subject to the copyright of, Lloyds Bank plc or its affiliates (together, “Lloyds Bank”); (vi) is based on public information, and is in summary form and therefore may not be complete; (vii) may refer to future events which may or may not be within the control of Lloyds Bank, and its group companies, and its or their directors, officers, employees, associates and Lloyds (altogether, “Lloyds Persons”), and no representation or warranty, express or implied, is made as to whether or not such an event will occur; (viii) is subject to change at any time and Lloyds Bank is under no obligation to inform any person of any such change; (ix) may only be sent to recipients who may lawfully receive it in accordance with applicable law, regulation and rule of regulatory body (“Laws”); and (x) is not being distributed to and must not be passed on to the general public in the U.K., and may only be distributed in the U.K. to persons who are investment professionals within the meaning of Article 19 of the and Markets Act 2000 (Financial Promotion) order 2005 (the “Order”), or are persons falling within Article 49(2)(a) to (d) of the Order (all such persons being “Relevant Persons”), is directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons.

Securities services offered in the United States are offered by Lloyds Securities Inc. (“LSI”), a broker-dealer registered with the U.S. Securities and Exchange Commission and a member of the U.S. Financial Industry Regulatory Authority. LSI services are provided only in the United States.

Lloyds Bank has exercised reasonable care in preparing this Presentation (and in confirming that where any information or opinion in this Presentation is from or based on a third party source, that the source is accurate and reliable), however, no representation or warranty, express or implied, is made as to the accuracy, reliability or completeness of the facts contained in this Presentation by Lloyds Persons. This Presentation may refer to future events which may or may not be within the control of Lloyds Persons, and no representation or warranty, express or implied, is made as to whether or not such an event will occur. To the fullest extent permitted by Laws, Lloyds Persons accept no responsibility for and shall have no liability for any loss (including without limitation direct, indirect, consequential and loss of profit), damages, or for any liability to a third party however arising in relation to this Presentation (including without limitation in relation to any projection, analysis, assumption and opinion in this Presentation). Lloyds Bank reserves the right to terminate discussions with any recipient in its sole and absolute discretion at any time and without notice.

By accessing, viewing, attending or reading this Presentation, and by not immediately returning or deleting it, or leaving, you confirm and represent that: (a) you understand and agree to the contents of this important notice; (b) you are a person that may lawfully receive this Presentation in accordance with Laws applicable to you including those of the jurisdiction in which you are located; (c) if you are not located in the U.S., you are not a U.S. Person, as defined in SEC Rule 902 of Regulation S under the U.S. Securities Act 1933, as amended; (d) if you are located in the U.K., you are a Relevant Person; (e) you consent to delivery of this document by electronic transmission; (f) you have or will conduct your own independent enquiries and obtain professional legal, regulatory, tax and accounting advice as appropriate in relation to the contents of this Presentation; (g) any transaction which you may subsequently enter into will only be on the basis of your enquiries and advice, your own knowledge and experience, and on the basis of the documents that relate specifically to that transaction; (h) you will keep this Presentation strictly confidential and will not transmit or distribute this Presentation, or any reproduction or translation it, in whole or in part, of this Presentation, to any person without Lloyds Bank’s prior written consent; and (g) you will not use this Presentation to the detriment of Lloyds Bank or for any matter other than in relation to the transaction contemplated in this Presentation.

Lloyds Bank may engage in transactions in a manner inconsistent with any opinion in this Presentation. Lloyds Bank trades or may trade as principal in the securities or related derivatives included in this Presentation (“Relevant Securities”), and may have proprietary positions in, and/or may make markets in, Relevant Securities. Lloyds Persons may have an interest in any securities or financial product mentioned in this Presentation. Lloyds Bank and Lloyds Bank Commercial Banking are trading names of Lloyds Bank plc. Lloyds Bank and Lloyds Bank Commercial Banking are trading names of Bank of Scotland plc. Lloyds Bank plc. Registered Office: 25 Gresham Street, EC2V 7HN. Registered in and no. 2065. Bank of Scotland plc. Registered Office: The Mound, Edinburgh EH1 1YZ. Registered in Scotland no. SC327000. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration numbers 119278 & 169628, respectively

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