Lloyds TSB is committed to making a positive impact on local communities. As one of the UK’s leading financial services organisations we recognise the need to play our part in tackling some of the social issues that confront the communities in which our business is based.
Strong growth in the Group’s consumer lending portfolios and a focus on cost control were offset by the impact of a number of special items. These included a reduction of £57 million in profits from the sale and leaseback of premises and, in the mortgage, personal lending and credit card portfolios, the non-recurrence of provision releases totalling £72 million in 2001. Excluding these items pre-tax profits increased by 9 per cent.
The retail bank continued to develop its strategy of building deeper customer relationships, particularly with our higher value customers, which has resulted in good growth in customer lending and deposit balances. Our relationship offers will be extended further in 2003 with the launch of the
In March 2002, the Competition Commission’s report, following its investigation into the supply of banking services to small and medium size enterprises (SMEs), was published by the Government. The Group has implemented the remedies suggested by the Competition Commission and, as a result, it is likely that the annualised impact on profit before tax will be a reduction of some £150 million, based on the Group’s forecast level of interest rates.
New business income 398 358 Existing business – expected return 273 307 – experience variances (1) 37 – assumption changes and other items 78 95 – pension provisions (40) (70) – Abbey Life endowment provision (165) –
Management reports to the Group Chief Executive and has access to the Chairman and members of senior management; he is also a member of the Group Risk Committee.
The Board and senior management at both Group and business unit level receive relevant, reliable and timely management information in line with business objectives to ensure that activities are appropriately controlled, key risks are identified and monitored, decisions are implemented and regulatory obligations are met.
Credit Derivatives – these are a method of transferring credit risk from one counterparty to another and of managing exposure to selected counterparties. Credit derivatives include credit swaps, credit spread options and credit linked notes. Lloyds TSB has limited exposure to such instruments.
Group Compliance – all compliance personnel also have a reporting line to Group Compliance, which sets compliance standards across the Group and provides independent reporting and assessment to the Board and business unit directors.
– An Investment Committee oversees the Group’s investment in projects, and is constituted as a sub-committee of the Group Executive Committee.
Balance sheet and capital ratios Loans and advances to banks and customers 152,003 138,159 129,722 119,196 113,706
Options may be exercised between 2003 and 2012. Options were not exercisable because they had not been held for the period required by the relevant scheme or the performance conditions had not been met.
funds at year ended year ended funds at 1 January 31 December 31 December 31 December £m £m £m £m
*2001 figures have been restated to take account of the changes in accounting policy explained in note 1 and the reclassification of emerging markets debt earnings from Wholesale Markets and International Banking to Central group items.
Geographical analysis by issuer: United Kingdom 5,569 5,947 Other European 13,254 9,920 North America and Caribbean 6,077 4,708 Latin America 1,231 1,290 Asia Pacific 2,763 1,921
During 2002 the Group contributed a further £21 million of capital to Goldfish Holdings Limited.
Annual commitments under non-cancellable operating leases were: Premises Equipment Premises Equipment £m £m £m £m
Dated subordinated liabilities are repayable as follows: Group Company £m £m £m £m 2 years or less but over 1 year 505 63 – 15 5 years or less but over 2 years 548 753 249 249 40 Non-equity minority interests
A summarised profit and loss account for First National Vehicle Holdings and Abbey National Vehicle Finance for the period from 1 January 2002 to 17 April 2002 is set out below: £m
Net cash inflow from operating activities 5,394 9,927 b Analysis of cash as shown in the balance sheet 2002 2001 £m £m