**Exhibit  10.19**

**HOLMES  FINANCING (NO. 6) PLC**

**REPORT  AND ACCOUNTS**

**FOR  THE YEAR ENDED 31 DECEMBER 2005**

**Registered  in England and Wales No. 4359738**

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**Holmes Financing (No. 6) plc**

**Report of the directors**

The Directors submit their report together with the accounts for the year ended 31 December 2005.

**Principal activity and review of the year**

The principal activity of the Company is to issue asset backed notes and enter into all financial arrangements in that connection.

No future changes in activity are envisaged.

**Dividend**

The profit for the year on ordinary activities after tax amounted to £296,000 (2004: £1,000).

The Directors do not recommend the payment of a dividend (2004: £nil).

**Financial Instruments**

The Company’s financial instruments, other than derivatives, comprise loans to group undertakings, borrowings, cash and liquid resources, and various items, such as debtors andcreditors that arise directly from its operations.  The main purpose of these financial instruments is to raise finance for the Company’s operations.

The Company also enters into derivatives transactions (principally cross currency swaps). The purpose of such transactions is to manage the currency risks arising from the Company’soperations and its sources of finance.

It is, and has been throughout the year under review, the Company’s policy that no trading in financial instruments shall be undertaken.

The main risk arising from the Company’s financial instruments is currency risk. The Company has debt securities in issue denominated in US Dollars, Euros and Swiss Francs. The Boardreviews and agrees policies for managing this risk. The Company’s policy is to eliminate all exposures arising from movements in exchange rates by the use of cross currency swaps to hedge payments of interest and principal on the securities.

All other assets, liabilities and transactions are denominated in Sterling.

Further disclosures regarding financial risk management objectives and policies and the company’s exposure to principal risks can be found in note 1.

**Directors and their interests**

The Directors who served throughout the year were:

Mr D M Green    Mr M McDermottWilmington Trust  SP Services (London) Limited (formerly SPV Management Limited)

At the year end and the previous year end, Holmes Holdings Limited and Mr M McDermott jointly held one share in the Company.

Wilmington Trust SP Services (London) Limited and Mr M McDermott jointly held one share in the holding company, Holmes Holdings Limited, at the year end. The other share in HolmesHoldings Limited was held by Wilmington Trust SP Services (London) Limited. Mr M McDermott is also a Director of Wilmington Trust SP Services (London) Limited.

None of the other Directors had a beneficial interest in the shares of the Company, or of the holding company, Holmes Holdings Limited and its subsidiaries, at the year-end.

**Directors’  responsibility statement**

The directors are responsible for preparing their report and financial statements. The directors have chosen to prepare accounts for the company in accordance with International FinancialReporting Standards (IFRSs).  Company law requires the directors to prepare such financial statements in accordance with International Financial Reporting Standards, the Companies Act 1985 and Article 4 of the IAS Regulation.

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**Holmes Financing (No. 6) plc**

**Directors’  responsibility statement - continued**

International  Accounting Standard 1 requires that financial statements present fairly for  each financial year the company’s financial position, financial performance  and cash flows. This requires the faithful representation of the effects of  transactions, other events and conditions in accordance with the definitions  and recognition criteria for assets, liabilities, income and expenses set out  in the International Accounting Standards Board’s ‘Framework for the  preparation and Presentation of Financial Statements’.

In virtually all circumstances, a fair presentation will be achieved by compliance with all applicable International Financial Reporting Standards. Directors are also required to:

| **·** | properly        select and apply accounting policies;                                                                                                                                                                                                                                                                                    |
|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **·** | present        information, including accounting policies, in a manner that provides        relevant, reliable, comparable and understandable information;                                                                                                                                                                               |
| ·     | provide      additional disclosures when compliance with the specific requirements in      International Financial Reporting Standards is insufficient to enable users      to understand the impact of particular transactions, other events and conditions      on the entity’s financial position and financial performance; and |
| ·     | prepare      the accounts on a going concern basis unless, having assessed the ability      of the company to continue as a going concern, management either intends      to liquidate the entity or to cease trading, or have no realistic alternative      but to do so.                                                               |

The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the company, for safeguarding the assets,for taking reasonable steps for the prevention and detection of fraud and other irregularities and for the preparation of a directors’ report which complies with the requirements of the Companies Act 1985.

Legislation in the United Kingdom governing the preparation and dissemination of financial statements differs from legislation in other jurisdictions.

**Going concern**

The Directors confirm that they are satisfied that Holmes Financing (No.6) plc has adequate resources to continue in business for the foreseeable future. For this reason, they continue toadopt a going concern basis in preparing the financial statements.

**Auditors**

At the forthcoming Annual General Meeting of the Company it will be proposed that Deloitte & Touche LLP be re-appointed as auditors of the Company, in accordance with the resolutionby Abbey National plc to appoint Deloitte & Touche LLP as auditors of Abbey National plc and its subsidiaries.

**By Order of the Board**

For and on behalf  ofAbbey National  Secretariat Services Limited, Secretary

24 February 2006

Abbey National House, 2 Triton Square, Regent's Place, London NW1 3AN

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**Holmes Financing (No. 6) plc**

**Independent auditors’ report to the members of Holmes Financing (No. 6) PLC**

We have audited the individual company financial statements (the “financial statements”) of Holmes Financing (No. 6) PLC for the year ended 31 December 2005, which comprise theincome statement, the balance sheet, the cash flow statement and the related notes 1 to 21. These financial statements have been prepared under the accounting policies set out therein.

**Respective responsibilities of directors and auditors**

The directors' responsibilities for preparing the Annual Report and the financial statements in accordance with applicable United Kingdom law and International Financial ReportingStandards (IFRSs) as adopted for use in the European Union are set out in the statement of directors' responsibilities.

Our responsibility is to audit the financial statements in accordance with relevant United Kingdom legal and regulatory requirements and International Standards on Auditing (UK andIreland) and the Listing Rules of the Financial Services Authority.

We report to you our opinion as to whether the financial statements give a true and fair view in accordance with the relevant framework and are properly prepared in accordance with theCompanies Act 1985 and Article 4 of the IAS Regulation. We also report to you if, in our opinion, the directors’ report is not consistent with the financial statements, if the company has not kept proper accounting records, if we have notreceived all the information and explanations we require for our audit, or if information specified by law or the Listing Rules regarding directors’ remuneration and transactions with the company and other members of the group is not disclosed.

We read other information contained in the directors’ report and consider the implications for our report if we become aware of any apparent misstatements or material inconsistencieswith the financial statements.

**Basis of audit opinion**

We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. An audit includes examination, on a test basis, ofevidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgments made by the directors in the preparation of the financial statements, and of whether theaccounting policies are appropriate to the circumstances of the company consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonableassurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financialstatements.

**Opinion**

In our opinion:

|   | **·** | the        financial statements give a true and fair view in accordance with those        IFRSs as adopted for use in the European Union, of the state of the company's        affairs as at 31 December 2005 and of its profit for the year then ended;        and |
|--------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |              |                                                                                                                                                                                                                                                                |
|   | ·     | the financial      statements have been properly prepared in accordance with the Companies      Act 1985.                                                                                                                                                           |

**Deloitte &  Touche LLP**Chartered Accountants  and Registered Auditors   London

24 February 2006

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**Holmes Financing (No. 6) plc**

**Income Statement**

For the Year ended 31 December  2005

|                                            |           |  | **Year        ended**       |  | **Year        ended**       |   |
|--------------------------------------------|-----------|--|-----------------------------|--|-----------------------------|--------|
|                                            | **Notes** |  | **31        December 2005** |  | **31        December 2004** |   |
|                                            |           |  | **£000**              |  | **£000**              |   |
|                                            |           |  |                             |  |                        |   |
| Interest      and similar income           | 3         |  | 121,925                     |  | 143,427                     |   |
| Interest expense and      similar charges  | 4         |  | (121,925)                   |  | (143,426)                   |   |
|                                            |           |  |                             |  |                             |   |
| Net      Interest Income                   |           |  | -                           |  | 1                           |   |
|                                            |           |  |                             |  |                             |   |
| Other      operating income                | 6         |  | 423                         |  | -                           |   |
|                                            |           |  |                             |  |                             |   |
| Profit      before tax                     |           |  | 423                         |  | 1                           |   |
| Tax                                        | 7         |  | (127)                       |  | -                           |   |
|                                            |           |  |                             |  |                             |   |
| Profit attributable      to equity holders | 16        |  | 296                         |  | 1                           |   |
|                                            |           |  |                             |  |                             |   |

The Company has no recognised income or expenses other than the profits for the current and previous year as set out above. Accordingly no separate statement of recognised income andexpense is presented.

All of the operations  of the Company are classed as continuing in the current and prior years.

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**Holmes Financing (No. 6) plc**

**Balance Sheet**

As at 31 December 2005

|                                            |           |        | **31        December 2005** |        | **31        December 2004** |   |
|--------------------------------------------|-----------|--------|-----------------------------|--------|-----------------------------|--------|
|                                            | **Notes** |        | **£000**              |        | **£000**              |   |
|                                       |      |   |                        |   |                        |   |
| Loans      and advances to group companies | 8         |        | 2,077,278                   |        | 2,950,772                   |   |
| Other assets                               | 10        |        | 21,373                      |        | 32,846                      |   |
| Cash      and cash equivalents             | 13        |        | 56,567                      |        | 82,561                      |   |
|                                            |           |        |                             |        |                             |   |
| Total assets                               |           |        | 2,155,218                   |        | 3,066,179                   |   |
|                                            |           |        |                             |        |                             |   |
| Derivative financial      instruments      | 9         |        | (4,234)                     |        | -                           |   |
| Debt securities in      issue              | 11        |        | (2,072,621)                 |        | (2,950,772)                 |   |
| Deferred tax liabilities                   | 12        |        | (127)                       |        | -                           |   |
| Other liabilities                          | 14        |        | (77,889)                    |        | (115,356)                   |   |
|                                            |           |        |                             |        |                             |   |
| Total Liabilities                          |           |        | (2,154,871)                 |        | (3,066,128)                 |   |
|                                            |           |        |                             |        |                             |   |
|                                            |           |        |                             |        |                             |   |
| Equity                                     |           |        |                             |        |                             |   |
| Share capital                              | 15        |        | (50)                        |        | (50)                        |   |
| Retained earnings                          | 16        |        | (297)                       |        | (1)                         |   |
|                                            |           |        |                             |        |                             |   |
| Total liabilities and      equity          |           |        | (2,155,218)                 |        | (3,066,179)                 |   |
|                                            |           |        |                             |        |                             |   |

The financial****statements were approved bythe board of directors and authorised for issue on 24 February 2006. They were signed on its behalf by:

M McDermott Director

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**Holmes Financing (No. 6) plc**

**Cash Flow  Statement**

For the Year ended 31 December 2005

|                                                    |   |           |        | **Year        ended 31** |        | **Year        ended 31** |   |
|----------------------------------------------------|--------|-----------|--------|--------------------------|--------|--------------------------|--------|
|                                                    |   | **Notes** |        | **December        2005** |        | **December        2004** |   |
|                                                    |   |           |        | **£000**           |        | **£000**           |   |
|                                                    |   |           |   |                          |   |                          |   |
| Net      cash (used in)/from operating activities  |   | 17        |   | (25,994)                 |   | 82,561                   |   |
|                                                    |        |           |        |                          |        |                          |   |
| **Investing activities**                           |   |           |   |                          |   |                          |   |
| Repayment of loans      to group companies         |   |           |   | 873,494                  |   | -                        |   |
|                                                    |        |           |        |                          |        |                          |   |
| **Net cash from investing      activities**        |   |           |   | 873,494                  |   | -                        |   |
|                                                    |        |           |        |                          |        |                          |   |
|                                                    |   |           |   |                          |   |                          |   |
| **Financing activities**                           |   |           |   |                          |   |                          |   |
| Repayment of debt securities      in issue         |   |           |   | (873,494)                |   | -                        |   |
|                                                    |        |           |        |                          |        |                          |   |
| **Net cash used in      financing activities**     |   |           |   | (873,494)                |   | -                        |   |
|                                                    |        |           |        |                          |        |                          |   |
|                                                    |   |           |   |                          |   |                          |   |
| **Net movement in      cash and cash equivalents** |   |           |   | (25,994)                 |   | 82,561                   |   |
| Cash and cash equivalents      brought forward     |   |           |   | 82,561                   |   | -                        |   |
| **Cash and cash equivalents      carried forward** |   |           |   | 56,567                   |   | 82,561                   |   |
|                                                    |        |           |        |                          |        |                          |   |

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**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**1. Accounting policies**

**Adoption of International Accounting Standards**

The financial statements have for the first time, been prepared in accordance with International Financial Reporting Standards (“IFRS”) adopted by the International AccountingStandards Board (“IASB”), and interpretations issued by the International Financial Reporting Interpretations Committee of the IASB. The date of transition to IFRS for the Company and the date of its opening IFRS balance sheet was 1January 2004.

The Company has chosen to adopt IFRS 7 “Financial Instruments: Disclosure” for this financial year, earlier than is required by the IASB.

As allowed by  “First time adoption of international financial reporting standards”  (IFRS 1), and “Financial Instruments: Disclosure “(IFRS 7) the Company  has not restated its 2004 income statements and balance sheets to comply with  IAS 32, IAS 39 and IFRS 7. The impact of this is that the Company’s derivatives  will not be held at fair value in the comparative income statement and balance  sheet and the valuation adjustment to the nominal value of the debt securities  in issue that qualify as hedging instruments will not be included in the comparative  income statement and balance sheet.

The principal accounting policies applied in the preparation of financial statements are set out below. These policies have been consistently applied to all years presented, unless otherotherwise stated.

**Basis of preparation**

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). The financial statements have been prepared under the historical costconvention, as modified by the revaluation of available-for-sale financial assets, financial assets and financial liabilities held at fair value through profit or loss and all derivative contracts.

The financial statements have also been prepared in accordance with IFRSs adopted for use in the European Union and therefore comply with Article 4 of the EU IAS regulation.

Due to the nature of the business the Directors’ are of the opinion that it is more appropriate to use net interest income rather than turnover in presenting the income statement.

**Foreign currency translation**

Items included in the financial statements of the entity are measured using the currency that best reflects the economic substance of the underlying events and circumstances relevant tothat entity (“the measurement currency”). The financial statements are presented in Pounds Sterling.

Foreign currency transactions are translated into the measurement currency at the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resultingfrom the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.

**Revenue recognition**

Interest income and expense is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discountsestimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount.

**Offsetting financial instruments**

Financial assets and liabilities including derivatives are offset and the net****amount reported in the balance sheet when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle theliability simultaneously.

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**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**Derivative financial instruments and hedge accounting**

Derivatives are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently remeasured at their fair value. Fair values are obtainedfrom quoted market prices in active markets, including recent market transactions, and valuation techniques, including discounted cash flow models and option pricing models as appropriate.  All derivatives are carried as assets when fair value ispositive and as liabilities when fair value is negative.

The method of recognising the resulting fair value gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.The entity designates all its derivatives as hedges of the fair value of recognised assets or liabilities or firm commitments (fair value hedge). Hedge accounting is used for derivatives designated in this way provided certain criteria are met.

The entity documents, at the inception of the transaction, the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy forundertaking various hedge transactions. The entity also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fairvalues or cash flows of hedged items.

**Fair value hedge**

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with any changes in the fair value of thehedged asset or liability that are attributable to the hedged risk. Any hedge ineffectiveness is shown in other operating income.

If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of the hedged item for which the effective interest method is used is amortised toprofit or loss over the period to maturity. The adjustment to the carrying amount of a hedged equity security remains in retained earnings until the disposal of the equity security.

**Income taxes, including deferred income taxes**

Income tax payable on profits, based on the applicable tax law in each jurisdiction is recognised as an expense in the period in which profits arise. The tax effects of income tax lossesavailable to carry forward are recognised as an asset when it is probable that future taxable profits will be available, against which these losses can be utilised**.**

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in thefinancial statements. Currently enacted tax rates are used in the determination of deferred income tax.

Deferred and  current tax assets and liabilities are only offset when they arise in the same  tax reporting group and where there is both the legal right and the intention  to settle on a net basis or to realise the asset and settle the liability simultaneously.

**Financial assets**

The entity classifies  its financial assets as loans and receivables which are held at amortised cost.  These includes loans and advances to group companies shown on the face of the  balance sheet, accrued interest receivable shown within other assets.and cash  and cash equivalents shown on the face of the balance sheet. Derivatives are  classified as fair value and are shown on the face of the balance sheet.

**Cash and cash equivalents**

For the purposes of the cash flow statement, cash and cash equivalents comprise balances with less than three months’ maturity from the date of acquisition, including cash and nonrestricted balances with central banks, treasury bills and other eligible bills, loans and advances to banks, amounts due from other banks and short term investments in securities

**Financial Liabilities**

Financial liabilities are measured at amortised cost, which includes a valuation adjustment for debt securities designated as hedging instruments. These include debt securities in issueshown on the face of the balance sheet, and accrued interest shown within other liabilities.

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**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**Financial Risk factors**

The company’s activities expose it to a variety of financial risks including currency risk, fair value interest rate risk and liquidity risk. The company’s overall riskmanagement programmed focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the company’s financial performance. The company uses derivative financial instruments to hedge certain riskexposures.

Risk management is carried out by the central risk management function of the Abbey Group. Authority flows from the Abbey National plc Board of Directors to the Chief Executive Office andfrom him to his direct reports. Delegation of authority is to individuals. Formal standing committees are maintained for effective management or oversight. Their authority is derived from the person they are intended to assist.

**Currency Risk**

The main operating (or “functional”) currencies of its operations are sterling, euro, US dollars and Swiss Francs. As the Company prepares its financial statements in sterling,these will be affected by movements in the euro/sterling; US dollar/sterling and Swiss Franc/sterling exchange rates. The exposure to this risk is mitigated by the use of cross currency derivatives. Taking this into account, the Company did not havea material financial exposure to foreign exchange gains and losses in either of the years to 31 December 2005 or 31 December 2004.

Included in the table below are the Company’s assets and liabilities at carrying amounts classified by currency.

|                                            | **Euro**       |  | **US        Dollars** |  | **Swiss        Francs** |  | **Sterling**   |  | **Total**      |  |
|--------------------------------------------|----------------|--|-----------------------|--|-------------------------|--|----------------|--|----------------|--|
|                                            | **£000** |  | **£000**        |  | **£000**          |  | **£000** |  | **£000** |  |
|                                            |                |  |                       |  |                         |  |                |  |                |  |
| Loans      and advances to group companies | 691,149        |  | 710,899               |  | 129,230                 |  | 546,000        |  | 2,077,278      |  |
| Other assets                               | -              |  | -                     |  | -                       |  | 21,373         |  | 21,373         |  |
| Cash      and cash equivalents             | -              |  | -                     |  | -                       |  | 56,567         |  | 56,567         |  |
|                                            |                |  |                       |  |                         |  |                |  |                |  |
| Total      assets                          | 691,149        |  | 710,899               |  | 129,230                 |  | 623,940        |  | 2,155,218      |  |
|                                            |                |  |                       |  |                         |  |                |  |                |  |
| Derivative      financial instruments      | 58,235         |  | (66,924)              |  | 4,455                   |  | -              |  | (4,234)        |  |
| Debt securities in      issue              | (749,458)      |  | (643,448)             |  | (133,715)               |  | (546,000)      |  | (2,072,621)    |  |
| Tax liabilities                            | -              |  | -                     |  | -                       |  | (127)          |  | (127)          |  |
| Other liabilities                          | (3,830)        |  | (7,010)               |  | (1,054)                 |  | (65,995)       |  | (77,889)       |  |
|                                            |                |  |                       |  |                         |  |                |  |                |  |
| Total Liabilities                          | (695,053)      |  | (717,382)             |  | (130,314)               |  | (612,122)      |  | (2,154,871)    |  |
|                                            |                |  |                       |  |                         |  |                |  |                |  |

**Cash flow and fair value interest rate risk**

Interest rate repricing gap information is shown in the table below at 31 December 2005. It provides an estimate of the repricing profile of the Company’s assets, liabilities andother off-balance sheet exposures.  For the major categories of assets and liabilities, the table shows the carrying values of interest earning assets and liabilities, which reprice within selected time banks. Items are allocated to time bans byreference to the earlier of the next interest rate repricing date and the legal maturity date. This leads to an apparent timing mismatch where the anticipated maturity date is different from the legal maturity date and hedges have been structuredaccordingly. The tables do not purport to measure market risk exposure.

|                                            |                       |        | **Non-**       |        |                |        |
|--------------------------------------------|-----------------------|--------|----------------|--------|----------------|--------|
|                                            | **1-3        months** |        | **interest**   |        |                |        |
|                                            | **£000**        |        | **bearing**    |        | **Total**      |        |
|                                            |                       |        | **£000** |        | **£000** |        |
|                                       |                  |   |           |   |           |   |
| Loans      and advances to group companies | 2,077,278             |        | -              |        | 2,077,278      |        |
| Other assets                               | -                     |        | 21,373         |        | 21,373         |        |
| Cash      and cash equivalents             | 56,567                |        | -              |        | 56,567         |        |
|                                            |                       |        |                |        |                |        |
| Total      assets                          | 2,133,845             |        | 21,373         |        | 2,155,218      |        |
|                                            |                       |        |                |        |                |        |
| Derivative financial      instruments      | (4,234)               |        | -              |        | (4,234)        |        |
| Debt securities in      issue              | (2,072,621)           |        | -              |        | (2,072,621)    |        |
| Tax liabilities                            | -                     |        | (127)          |        | (127)          |        |
| Other liabilities                          | (56,567)              |        | (21,322)       |        | (77,889)       |        |
|                                            |                       |        |                |        |                |        |
| Total Liabilities                          | (2,133,422)           |        | (21,449)       |        | (2,154,871)    |        |
|                                            |                       |        |                |        |                |        |

The table below  summarises the effective interest rate by major currencies for monetary financial  instruments:

|                                  | **Euro** |  | **US        Dollars** |  | **Swiss****Franc** |  | **Sterling** |   |
|---------------------------------------|----------|--|-----------------------|--|--------------------|--|--------------|--------|
|                                  |          |  |                       |  |                    |  |              |   |
|                                  |          |  |                       |  |                    |  |              |   |
| Derivative financial      instruments | 4.91%    |  | 4.92%                 |  | 4.92%              |  | 4.90%        |        |
| Debt securities in      issue         | 2.50%    |  | 4.50%                 |  | 2.50%              |  | 4.90%        |        |
|                                       |          |  |                       |  |                    |  |              |   |

 

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**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**Interest rate sensitivity**

As a result  of the cross currency swaps the Company’s total interest income and expenditure  on financial assets and liabilities is based on the same rate of sterling LIBOR,  it therefore has no material sensitivity to changes in interest rates.

**Liquidity risk**

The table below analyses the Company’s assets and liabilities into relevant maturity groupings based on the remaining period at balance sheet date to contractual maturity date:

|                                            | **Up        to 1** |   | **1-3**        |   | **3-12**       |   |                      |        | **Over        5** |        | **Total**      |   |
|--------------------------------------------|--------------------|--------|----------------|--------|----------------|--------|----------------------|--------|-------------------|--------|----------------|--------|
|                                            | **month**          |   | **months**     |   | **months**     |   | **1-5        years** |        | **years**         |        | **£000** |   |
|                                            | **£000**     |   | **£000** |   | **£000** |   | **£000**       |        | **£000**    |        |                |   |
|                                       |               |   |           |   |           |   |                 |   |              |   |           |   |
| Loans      and advances to group companies | -                  |   | -              |   | -              |   | 1,403,756            |        | 673,522           |        | 2,077,278      |   |
| Other assets                               | -                  |   | 21,373         |   | -              |   | -                    |        | -                 |        | 21,373         |   |
| Cash      and cash equivalents             | -                  |   | 56,567         |   | -              |   | -                    |        | -                 |        | 56,567         |   |
|                                            |                    |        |                |        |                |        |                      |        |                   |        |                |   |
| Total      assets                          | -                  |   | 77,940         |   | -              |   | 1,403,756            |        | 673,522           |        | 2,155,218      |   |
|                                            |                    |        |                |        |                |        |                      |        |                   |        |                |   |
| Derivative      financial instruments      |                    |   |                |   |                |   | (2,361)              |        | (1,873)           |        | (4,234)        |   |
| Debt securities in      issue              | -                  |   | -              |   | -              |   | (1,401,053)          |        | (671,568)         |        | (2,072,621)    |   |
| Tax      liabilities                       | -                  |   | (127)          |   | -              |   | -                    |        | -                 |        | (127)          |   |
| Other liabilities                          | -                  |   | (77,889)       |   | -              |   | -                    |        | -                 |        | (77,889)       |   |
|                                            |                    |        |                |        |                |        |                      |        |                   |        |                |   |
| Total Liabilities                          | -                  |   | (78,016)       |   | -              |   | (1,403,414)          |        | (673,441)         |        | (2,154,871)    |   |
|                                            |                    |        |                |        |                |        |                      |        |                   |        |                |   |
| Net liquidity gap                          | -                  |   | 76             |   | -              |   | 342                  |        | 81                |        | 347            |   |
|                                            |                    |        |                |        |                |        |                      |        |                   |        |                |   |

**Credit risk**

The maximum exposure to credit risk is the carrying amount of the Loans and advances to group companies of £2,077,278,000.

**Accounting for derivative financial instruments and hedging activities**

The Company holds derivatives as fair value hedges of the non-sterling debt securities in issue in order to hedge foreign currency and interest rate risk. These require the Company to paya rate based on three-month sterling LIBOR and receive US dollar LIBOR, EURIBOR and fixed rate receipts in Swiss Francs. These are initially recognised and subsequently re-measured at fair value.

**Fair value estimation**

Where quoted market prices are not available, a discounted cash flow model is used based on a current yield curve appropriate for the remaining term to maturity.

**2. Business and geographical segments**

All of the Company’s income is derived from activities in the same business and geographical segment, within the UK. There were no discontinued operations during the period.

**3. Interest and similar income**

|                                                 | **Year        ended**       |  | **Year        ended**       |  |
|-------------------------------------------------|-----------------------------|--|-----------------------------|--|
|                                                 | **31        December 2005** |  | **31        December 2004** |  |
|                                                 | **£000**              |  | **£000**              |  |
|                                                 |                             |  |                        |  |
| Interest receivable      from group companies   | 119,819                     |  | 142,326                     |  |
| Interest receivable      on collateralised cash | 2,106                       |  | 1,101                       |  |
|                                                 |                             |  |                             |  |
| **Interest receivable**                         | **121,925**                 |  | **143,427**                 |  |
|                                                 |                             |  |                             |  |

**4. Interest expense and similar charges**

|                                              | **Year        ended**       |        | **Year        ended**       |        |
|----------------------------------------------|-----------------------------|--------|-----------------------------|--------|
|                                              | **31        December 2005** |        | **31        December 2004** |        |
|                                              | **£000**              |        | **£000**              |        |
|                                              |                             |        |                        |        |
| Interest      payable on debt securities     | 145,754                     |        | 142,325                     |        |
| Interest payable on      collateralised cash | 2,106                       |        | 1,101                       |        |
| Swap interest payable                        | (25,935)                    |        | -                           |        |
|                                              |                             |        |                             |   |
| **Interest      payable**                    | **121,925**                 |   | **143,326**                 |   |
|                                              |                             |        |                             |   |

----

**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**5. Profit before tax**

Profit before tax has been arrived at after (charging)/crediting:

|                                      | **Year        ended**       | **Year        ended**       |   |
|--------------------------------------|-----------------------------|-----------------------------|--------|
|                                      | **31        December 2005** | **31        December 2004** |   |
|                                      | **£000**              | **£000**              |   |
|                                      |                             |                             |   |
| Net      foreign exchange gains      | 669                         | -                           |   |
| Net loss on hedging      derivatives | (4,233)                     |                             |   |
| Net gain on hedged      item         | 3,987                       | -                           |   |
|                                      |                             |                             |   |

Auditors’ remuneration for the current and previous financial years has been borne by Holmes Funding Limited, a fellow subsidiary undertaking.

No emoluments were paid to the Directors in the current or previous financial year.

The Company had no employees in the current or previous financial year.

**6. Other operating income**

|                                      | **Year        ended**       | **Year        ended**       |   |
|--------------------------------------|-----------------------------|-----------------------------|--------|
|                                      | **31        December 2005** | **31        December 2004** |   |
|                                      | **£000**              | **£000**              |   |
|                                 |                        |                        |   |
| Net      foreign exchange gains      | 669                         | -                           |   |
| Net loss on hedging      derivatives | (4,233)                     | -                           |   |
| Net      gain on hedged item         | 3,987                       | -                           |   |
|                                      |                             |                             |   |
|                                      | **423**                     |                             |   |
|                                      |                             |                             |   |

**7. Tax**

|                                | **Year        ended**       | **Year        ended**       |   |
|--------------------------------|-----------------------------|-----------------------------|--------|
|                                | **31        December 2005** | **31        December 2004** |   |
|                                | **£000**              | **£000**              |   |
|                                |                             |                             |   |
| Current        tax:            |                             |                             |   |
| UK        corporation tax      | -                           | -                           |   |
|                                |                             |                             |   |
| Deferred        tax (note 12): | -                           | -                           |   |
| Current        year            | 127                         | -                           |   |
|                                |                             |                             |   |
|                                | 127                         | -                           |   |
|                                |                             |                             |   |

Corporation tax is calculated at 30% (2004: 30%) of the estimated assessable profit for the year.

The charge for the year can be reconciled to the profit per the income statement as follows:

|                                                            | **Year        ended**       | **Year        ended**       |   |
|------------------------------------------------------------|-----------------------------|-----------------------------|--------|
|                                                            | **31        December 2005** | **31        December 2004** |   |
|                                                            | **£000**              | **£000**              |   |
|                                                            |                             |                             |   |
| Profit      before tax                                     | 423                         | -                           |   |
|                                                            |                             |                             |   |
|                                                            |                             |                             |   |
| Tax at the UK corporation      tax rate of 30% (2004: 30%) | 127                         | -                           |   |
|                                                            |                             |                             |   |
| **Tax      expense for the year**                          | **127**                     | -                           |   |
|                                                            |                             |                             |   |

**8. Loans and advances to group companies**

|                      | **31        December 2005** |  | **31        December 2004** |  |
|----------------------|-----------------------------|--|-----------------------------|--|
|                      | **£000**              |  | **£000**              |  |
|                      |                             |  |                        |  |
| **Repayable:**       |                             |  |                             |  |
| Less than 1 year     | -                           |  | -                           |  |
| 1 to 2 years         | -                           |  | -                           |  |
| 2 to 5 years         | 1,403,756                   |  | 2,204,833                   |  |
| Greater than 5 years | 673,522                     |  | 745,939                     |  |
|                      |                             |  |                             |  |
|                      | **2,077,278**               |  | **2,950,772**               |  |
|                      |                             |  |                             |  |

----

**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**9. Derivative Financial Instruments**

The Company holds derivatives as fair value hedges of the non-sterling debt securities in issue in order to hedge foreign currency and interest rate risk. These require the Company to paya rate based on three-month sterling LIBOR and receive US dollar LIBOR, EURIBOR and fixed rate receipts in Swiss Francs. These are initially recognised and subsequently re-measured at a fair value. The hedging relationship between the cross currencyderivatives and the debt securities in issue qualifies for a hedge accounting treatment of the liabilities.

**10. Other assets**

|                                                                     | **31        December 2005** |  | **31        December 2004** |  |
|---------------------------------------------------------------------|-----------------------------|--|-----------------------------|--|
|                                                                     | **£000**              |  | **£000**              |  |
|                                                                |                        |  |                        |  |
| Called up share capital      not paid - due from parent undertaking | 37                          |  | 37                          |  |
| Accrued interest due      from group companies                      | 21,336                      |  | 32,809                      |  |
|                                                                     |                             |  |                             |  |
|                                                                     | **21,373**                  |  | **32,846**                  |  |
|                                                                     |                             |  |                             |  |

The carrying amount of other assets approximates to their fair value.

**11. Debt securities in issue**

|                                                       | **31        December 2005** |        | **31        December 2004** |        |
|-------------------------------------------------------|-----------------------------|--------|-----------------------------|--------|
|                                                       | **£000**              |        | **£000**              |        |
|                                                  |                        |   |                        |   |
| Series 2 Class A Floating      Rate Notes 2008        | -                           |        | 801,077                     |        |
| Series 2 Class B Floating      Rate Notes 2040        | -                           |        | 26,916                      |        |
| Series 2 Class C Floating      Rate Notes 2040        | -                           |        | 45,501                      |        |
| Series 3 Class A Floating      Rate Notes 2009        | 686,881                     |        | 633,500                     |        |
| Series 3 Class B Floating      Rate Notes 2040        | 23,362                      |        | 21,539                      |        |
| Series 3 Class C Floating      Rate Notes 2040        | 39,215                      |        | 36,110                      |        |
| Series 4 Class A1 Floating      Rate Notes 2009       | 580,456                     |        | 641,026                     |        |
| Series 4 Class A2 Fixed/Floating      Rate Notes 2009 | 133,716                     |        | 129,230                     |        |
| Series 4 Class B Floating      Rate Notes 2040        | 23,185                      |        | 25,642                      |        |
| Series 4 Class C Floating      Rate Notes 2040        | 39,806                      |        | 44,231                      |        |
| Series 5 Class A Floating      Rate Notes 2040        | 500,000                     |        | 500,000                     |        |
| Series 5 Class B Floating      Rate Notes 2040        | 17,000                      |        | 17,000                      |        |
| Series 5 Class C Floating      Rate Notes 2040        | 29,000                      |        | 29,000                      |        |
|                                                       |                             |        |                             |        |
|                                                       | **2,072,621**               |        | **2,950,772**               |        |
|                                                       |                             |        |                             |        |

Included in the carrying amount of debt securities in issue above are the following valuation adjustments as a result of the hedge accounting treatment of these instruments.

|                                                       | **31        December 2005** | **31        December 2004** |   |
|-------------------------------------------------------|-----------------------------|-----------------------------|--------|
|                                                       | **£000**              | **£000**              |   |
|                                                  |                        |                        |   |
| Series 3      Class A Floating Rate Notes 2009        | 53,381                      | -                           |   |
| Series 3      Class B Floating Rate Notes 2040        | 1,823                       | -                           |   |
| Series 3      Class C Floating Rate Notes 2040        | 3,105                       | -                           |   |
| Series 4      Class A1 Floating Rate Notes 2009       | (60,570)                    | -                           |   |
| Series 4      Class A2 Fixed/Floating Rate Notes 2009 | 4,486                       | -                           |   |
| Series 4      Class B Floating Rate Notes 2040        | (2,457)                     | -                           |   |
| Series 4      Class C Floating Rate Notes 2040        | (4,425)                     | -                           |   |
|                                                       |                             |                             |   |
|                                                  | (4,657)                     | -                           |   |
|                                                       |                             |                             |   |

The carrying amount of debt securities in issue approximates to their fair value.

All the Class A Notes (irrespective of series) will rank pari passu and rateably without any preference or priority except, until enforcement of the security for the Notes, as to paymentsof principal in respect of which the Class A1 Notes will rank in priority to the Class A2 Notes.

Payments in respect of the Class B and C Notes will only be made if, and to the extent that, there are sufficient funds after paying or providing for certain liabilities, includingliabilities in respect of the Class A Notes. The Class B Notes rank after the Class A Notes in point of security but before the Class C Notes.

----

**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**11. Debt securities in issue - continued**

Interest is payable on the notes at variable rates based on the one-month US Dollar LIBOR, three-month Sterling and US Dollar LIBOR and three-month EURIBOR, except for the Series 4 ClassA2 notes, on which interest is paid at a fixed rate until October 2007, after which it is paid at variable rates based on the three-month CHF LIBOR. The fixed rate notes have a weighted average interest rate of 2.5% pa. The weighted average interestrate on the bonds was 4.91%.

The Company’s obligations to noteholders, and to other secured creditors, are secured under a deed of charge that grants security over all of its assets in favour of the securitytrustee. The principal assets of the Company are loans made to Holmes Funding Limited, a group company, whose obligations in respect of these loans, are secured under a deed of charge which grants security over all its assets, primarily comprisingshares in a portfolio of residential mortgage loans, in favour of the security trustee. These mortgages fail the derecognition criteria described in IAS 39 and as such are represented by a receivable on the balance sheet of Holmes Funding Limited,though legally Holmes Funding Limited is entitled to the income from these mortgages. The security trustee holds this security for the benefit of all secured creditors of Holmes Funding Limited, including the Company.

**12. Deferred Tax**

|                         | **31        December 2005** | **31        December 2004** |  |
|-------------------------|-----------------------------|-----------------------------|--|
|                         | **£000**              | **£000**              |  |
|                         |                             |                             |  |
| Deferred tax liability: | 127                         | -                           |  |
|                         |                             |                             |  |

The movement on the deferred tax account is as follows:

|                         | **31        December 2005** | **31        December 2004** |   |
|-------------------------|-----------------------------|-----------------------------|--------|
|                         | **£000**              | **£000**              |   |
|                         |                             |                             |   |
| At 1 January            | -                           | -                           |   |
| Income statement charge | 127                         | -                           |   |
|                         |                             |                             |   |
| **At 31 December**      | **127**                     | -                           |   |
|                         |                             |                             |   |

The deferred tax liability arises as a result of the Company being taxed under the special regime for securitisation companies in the Finance Act 2005.

**13. Cash at bank and in hand**

The Company holds deposits at banks, which pay interest based on LIBOR.

Swap counterparties are subject to a cash collateralisation agreement whereby dependent on the credit rating of the counterparty an amount may be payable by the counterparty to theCompany. This amount is included in cash at bank and in hand, and within other liabilities. It is repayable when the swap agreements mature, or if earlier when the credit rating of the counterparty improves.

At 31 December 2005 an amount of £56,553,000 was held which related to cash received under cash collateralisation agreements. The amount was held on deposit at Federal Funds with aneffective interest rate to match the interest payable to the swap counterparty.

**14. Other liabilities**

|                                                             | **31        December 2005** |  | **31        December 2004** |  |
|-------------------------------------------------------------|-----------------------------|--|-----------------------------|--|
|                                                             | **£000**              |  | **£000**              |  |
|                                                        |                        |  |                        |  |
| Amounts      due in respect of collateralised cash received | 56,553                      |  | 82,547                      |  |
| Accrued interest payable                                    | 21,336                      |  | 32,809                      |  |
|                                                             |                             |  |                             |  |
|                                                             | **77,889**                  |  | **115,356**                 |  |
|                                                             |                             |  |                             |  |

The directors consider that the carrying amount of trade and other payables approximates to their fair value. Other liabilities due after one year amount to £nil (2004: £nil)

----

**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**15. Share capital**

|                                               | **31        December 2005** |  | **31        December 2004** |        |
|-----------------------------------------------|-----------------------------|--|-----------------------------|--------|
|                                               | **£000**              |  | **£000**              |        |
|                                          |                        |  |                        |        |
| **Authorised:**                               |                             |  |                             |        |
| 100,000 ordinary shares      of £1 each | 100                         |  | 100                         |        |
|                                               |                             |  |                             |        |
| **Issued:**                                   |                             |  |                             |        |
| 50,000 ordinary shares      of £1 each  | 50                          |  | 50                          |        |
|                                               |                             |  |                             |   |

49,998 Ordinary shares are partly paid to 25 pence. Two subscriber shares are fully paid.

**16. Retained earnings**

|                                      | **£000** |  |
|--------------------------------------|----------------|--|
|                                 |           |  |
| Balance      at 1 January 2004       | -              |  |
| Profit for the year                  | 1              |  |
|                                      |                |  |
| Balance at 1 January      2005       | 1              |  |
| Profit for the year                  | 296            |  |
|                                      |                |  |
| **Balance at 31 December      2005** | **297**        |  |
|                                      |                |  |

**17. Notes to the cash flow statements**

|                                                               | **31      December 2005** |  | **31      December 2004** |  |
|---------------------------------------------------------------|---------------------------|--|---------------------------|--|
|                                                               | **£000**            |  | **£000**            |  |
|                                                               |                           |  |                           |  |
| Profit      before tax                                        | 423                       |  | -                         |  |
|                                                               |                           |  |                           |  |
| Adjustments      for:                                         |                           |  |                           |  |
| Loss on derivatives                                           | 246                       |  | -                         |  |
| Gain      on foreign exchange                                 | (669)                     |  | -                         |  |
|                                                               |                           |  |                           |  |
|                                                               |                           |  |                           |  |
| Operating cash flows      before movements in working capital | -                         |  | -                         |  |
|                                                               |                           |  |                           |  |
| Decrease / (increase)      in receivables                     | 11,473                    |  | (32,795)                  |  |
| (Decrease) / increase      in payables                        | (37,467)                  |  | 115,356                   |  |
|                                                               |                           |  |                           |  |
| Cash (used in)/ generated      by operations                  | (25,994)                  |  | 82,561                    |  |
|                                                               |                           |  |                           |  |
| **Net cash flow from      operating activities**              | (25,994)                  |  | 82,561                    |  |
|                                                               |                           |  |                           |  |

Cash and cash equivalents (which are presented as a single class of assets on the face of the balance sheet) comprise cash at bank and other short-term highly liquid investments with amaturity of three months or less.

**18. Related party transactions**

The related party disclosures in this note apply to related parties, which comprise the following entities and individuals:

Abbey National plc, an entity with significant influence over the Company Holmes Funding Limited, a Group Company

**Trading transactions**

During the year, the company entered into the following transactions with related parties:

|                    | **Interest        receivable** |        | **Cash        and cash****equivalents        held with****related        parties** |        | **Amounts        owed by****related        parties** |   |
|-------------------------|--------------------------------|--------|------------------------------------------------------------------------------------|--------|------------------------------------------------------|--------|
|                    |
|                    |
|                    | **31        December 2005**    |        | **31        December 2005**                                                        |        | **31        December 2005**                          |   |
|                    | **£000**                 |        | **£000**                                                                     |        | **£000**                                       |   |
|                    |                           |   |                                                                               |   |                                                 |   |
| Abbey National plc      | -                              |        | 15                                                                                 |        | -                                                    |        |
| Holmes Funding Limited  | 119,818                        |        | -                                                                                  |        | 2,098,514                                            |        |
| Holmes Holdings Limited | -                              |        | -                                                                                  |        | 37                                                   |        |
|                         |                                |        |                                                                                    |        |                                                      |        |

----

**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**19. Parent undertaking and controlling party**

The immediate parent of the Company is Holmes Holdings Limited a company incorporated in Great Britain and registered in England and Wales.

Wilmington Trust SP Services (London) Limited (formerly SPV Management Limited), a company incorporated in Great Britain and registered in England and Wales, holds all of the beneficialinterest in the issued shares of Holmes Holdings Limited on a discretionary trust for persons employed as nurses in the United Kingdom and for charitable purposes.

The Company meets the definition of a Special Purpose Entity as defined in and is therefore consolidated within the Abbey National plc group accounts.

The ultimate parent undertaking and controlling party of Abbey National plc is Banco Santander Central Hispano S.A., a company incorporated in Spain. Banco Santander Central Hispano, S.A.is the parent undertaking of the largest group of undertakings for which group accounts are drawn up and of which the company is a member. Abbey National plc is the controlling party of the smallest group of undertakings for which the group accountsare drawn up and of which the Company is a member.

Copies of all sets of group accounts, which include the results of the Company, are available from Abbey National Secretariat, Abbey National House, 2 Triton Square, Regent’s Place,London, NW1 3AN.

**20. Explanation of transition to IFRSs**

Holmes Financing (No.6) PLC has chosen to prepare accounts in accordance with IFRSs for the year ended 31 December 2005.

Up to 31 December  2004, the Group prepared its financial statements in accordance with UK Generally  Accepted Accounting Principals (“UK GAAP").

Key standards IAS 32 “Financial Instruments: Disclosure and Presentation” and IAS 39 “Financial Instruments: Recognition and Measurement” and IFRS 7 “FinancialInstruments: Disclosures” have been applied prospectively from 1 January 2005. All other standards are required to be applied retrospectively.

No reconciliation  of profit attributable to shareholders, shareholders funds, income statement  or balance sheet under IFRS for the year to 31 December 2004 has been presented  as all applicable IFRS adjustments have only been applied prospectively.

**21. Comparatives under UK GAAP for FRS 13**

These are the disclosures that would have been included in the financial statements under UK GAAP relating to FRS 13 that have not been included in the financial statements above.

The following disclosures are made in respect of financial instruments as at 31 December 2004. Short-term debtors and creditors are included in all of the following disclosures.

**a. Maturity profile of financial liabilities**

| **2004**                                              | **Debt        securities in** |        |                              |        |                              |   |
|-------------------------------------------------------|-------------------------------|--------|------------------------------|--------|------------------------------|--------|
|                                                  | **issue**                     |        | **Other        liabilities** |        | **Total        liabilities** |   |
|                                                  | **£000**                |        | **£000**               |        | **£000**               |   |
|                                                  |                          |   |                         |   |                         |   |
| Within one      year or less or on demand             | -                             |   | 115,356                      |   | 115,356                      |   |
| More than      one year but not more than two years   | -                             |   | -                            |   | -                            |   |
| More than      two years but not more than five years | 2,204,833                     |   | -                            |   | 2,204,833                    |   |
| More than      five years                             | 745,939                       |   | -                            |   | 745,939                      |   |
|                                                       |                               |        |                              |        |                              |   |
|                                                  | 2,950,772                     |   | 115,356                      |   | 3,066,128                    |   |
|                                                       |                               |        |                              |        |                              |   |

There are no material undrawn committed borrowing facilities.

----

**Holmes Financing (No. 6) plc**

**Notes to the Financial  Statements for the year ended 31 December 2005**

**b. Interest rate profile of financial assets and liabilities**

| **2004**         |                |        |                          |        |                  |        | **Weighted**           |   |
|------------------|----------------|--------|--------------------------|--------|------------------|--------|------------------------|--------|
|             |                |        |                          |        |                  |        | **average        age** |   |
|             |                |        |                          |        | **Non-interest** |        | **until**              |   |
|             | **Total**      |        | **Floating        rate** |        | **bearing**      |        | **maturity***          |   |
|             | **£000** |        | **£000**           |        | **£000**   |        | **Years**              |   |
|             |           |   |                     |   |             |   |                   |   |
| **Assets:**      |                |        |                          |        |                  |        |                        |   |
| Sterling         | 3,066,179      |   | 3,033,333                |   | 32,846           |   | 0.1                    |   |
|                  |                |        |                          |        |                  |        |                        |   |
| **Liabilities:** |           |   |                     |   |             |   |                   |   |
| Sterling         | (3,066,128)    |   | (3,033,319)              |   | (32,809)         |   | 0.1                    |   |
|                  |                |        |                          |        |                  |        |                        |   |

*for non-interest bearing assets/liabilities only.

**c. Fair values of financial assets and liabilities**

The fair value of debt securities in issue was £2,957,887,000.

The estimated fair values of other assets and liabilities on the balance sheet were not materially different from their carrying amounts.

The estimated  fair value of the cross currency swaps entered into by the Company as at 31  December 2004 was a liability of £230,891,613. The cross currency swaps  mature between April 2008 and July 2040.

**d. Currency profile**

Taking into account the effect of derivative instruments, the Company did not have a material financial exposure to foreign exchange gains or losses on monetary assets and monetaryliabilities denominated in foreign currencies at 31 December 2004.

----