12th December, 2008

HBOS and Lloyds TSB - business as usual.

There has been much discussion about the proposed acquisition of HBOS by Lloyds TSB.

On this page, we will keep you up to date with what is happening and explain any implications for you as a St. James's Place Bank client.

The good news is you can carry on banking with St. James's Place Bank just as you always have done.

And, when we join forces to become Lloyds Banking Group, you will continue to benefit from great products, service and security.

What is happening and when?

You may be aware that St. James's Place Bank is part of HBOS plc. HBOS plc has agreed to be acquired by Lloyds TSB.

If the proposed acquisition goes ahead, St. James's Place Bank will continue to exist and we will be part of a new combined group, the Lloyds Banking Group plc.

The deal has now been approved by both HBOS and Lloyds TSB shareholders. The next step is to seek the sanction of the court at a hearing on 12 January 2009.

Providing this and all regulatory approvals are obtained, the first day of the new Group is expected to be within a few weeks of the court hearing.

Please be assured that there will be no immediate changes to your Accounts as a result of this announcement and you can continue doing business with us as usual.

What is the new combined group called?

The name of the new group is Lloyds Banking Group plc. Customers will continue to be able to do business with their usual familiar names, such as St. James's Place Bank, Halifax, Lloyds TSB and Bank of Scotland.

What does it mean for me?

There are no immediate changes to your St. James's Place Bank Accounts or the terms and conditions of any of our products or services as a result of this announcement, and you can continue doing business with us exactly as you always have, by phone or online.

Of course from time to time we make changes to our products, and when that happens we will notify you in our usual way.

Are my savings protected?

Yes, your savings remain protected exactly as they were before. St. James's Place Bank and Lloyds TSB savings will continue to be covered separately after the new group takes effect, as both organisations will continue to be covered by separate banking licences for the foreseeable future.

This means you will continue to be covered for up to £50,000 (or £100,000 for joint accounts) of total savings across all brands covered by the Bank of Scotland plc banking licence (which includes protection for St. James's Place Bank and St. James's Place Private Bank savers and these other trading names and divisions: Halifax, Bank of Scotland, Birmingham Midshires, Intelligent Finance, AA and Saga).

Lloyds TSB has five separate licensed banks, Lloyds TSB Bank, Lloyds TSB Private Banking, Lloyds TSB Scotland, Scottish Widows Bank and AMC. Deposits you have with each of these banks will be protected up to £50,000 (£100,000 for joint account holders).

Should there be any changes to our banking licences in future, we will contact you to tell you about them in the usual way.

Any regulated investments you hold with either company will also be protected exactly as before under the scheme.

Follow the link to find more information on the Financial Services Compensation Scheme

How will this change benefit me?

The combining of HBOS plc and Lloyds TSB creates a new group which will have a strong franchise and is expected to have excellent breadth and balance.

Our aim is to be the leading financial services organisation in the UK, using our strength and size to provide excellent customer service and create great value products for our customers.

Additional information

Should there be any changes in the future, we will contact you to tell you about them in the usual way.

If you would like to keep up to date with how the acquisition is progressing, please visit our website www.hbosplc.com.

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