Company: LLOBF
Filing Date: 2025-02-25
Form Type: 424B2
Source: 0000950103-25-002401
Chunk: 42

Company: Lloyds Banking Group plc
Filing Date: 2025-02-25
Form: 424B2
Chunk 42
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 application of the
Maximum Distributable Amount restrictions, if the PRA determines that a firm has insufficient capital to meet its PRA buffer, it will
be subject to enhanced supervisory action and will be required to prepare a capital restoration plan which could include restrictions
as a discretionary payment. In addition, any increases in our PRA buffer requirements would require LBG to hold additional CET1 capital
and therefore may increase the risk that Maximum Distributable Amount restrictions may apply.

LBG may be restricted in making interest payments
on the Additional Tier 1 Securities by the regulators in certain circumstances.

The PRA has wide-ranging powers under section
55M of the FSMA, under section 192C of the FSMA and under section 192T of the FSMA. These powers include, inter alia, a general
power to restrict or prohibit interest payments to holders of Additional Tier 1 Securities. There are no ex-ante limitations on the PRA’s
discretion to exercise this power. If the PRA exercises this power, LBG will exercise its discretion to cancel (in whole or in part, as
required by the PRA) interest payments in respect of the Additional Tier 1 Securities. Additionally, there is a regime for holding companies
that substantively control their group to be subject to supervisory approval and consolidated supervision.

In addition, the PRA has the power to alter the
amount of interest payable under debt instruments issued by banks subject to resolution proceedings and the date on which the interest
becomes payable under the debt instrument (including the power to suspend payment for a temporary period). See “—The Additional Tier 1 Securities may be subject to write-down, cancellation or conversion upon the occurrence of the exercise by the relevant U.K. resolution authority of the bail-in or capital instruments write-down and conversion powers, which powers are in addition to the terms of the Additional Tier 1 Securities which provide for Automatic Conversion on the occurrence of a Trigger Event.”

Such powers may be amended or extended from time
to time, or new powers restricting our ability to make interest payments on the Additional Tier 1 Securities may come into effect subsequent
to the date of this prospectus as a result of changes in the applicable regulatory framework. Speculation around the implementation of
such

restrictions could have a significant adverse effect
on the trading price of the Additional Tier 1 Securities and if such proposals are implemented, we may be required to cancel interest
payments on the Additional Tier 1 Securities.

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