22nd Nov 2006 13:00
Lloyds TSB Group PLC22 November 2006 136/06 22 November 2006 LLOYDS TSB GROUP - TRANSITION TO EUROPEAN EMBEDDED VALUE AT SCOTTISH WIDOWS Lloyds TSB Group plc will be holding a presentation for analysts and investorstoday at 2.00 p.m. The focus of the briefing will be to provide an overview ofthe financial impact of the transition to European Embedded Value ('EEV')accounting for the supplementary reporting of the Scottish Widows business,along with details of the EEV methodology adopted. Lloyds TSB Group will continue to report its statutory accounts under IFRS withonly insurance policies and certain investment business accounted for on anembedded value basis. Going forward, these contracts will be accounted for on abasis consistent with relevant EEV principles. The impact on the Lloyds TSBGroup statutory accounts is minimal. However, in line with industry bestpractice, the Group intends to introduce supplementary financial reportingrelating to Scottish Widows on an EEV basis, with a bottom-up, market consistentapproach, from the 2006 year end. For the year ended 31 December 2005, compared to Lloyds TSB Group's reportedIFRS accounts, the Scottish Widows supplementary EEV financial information showthat: - Scottish Widows' new business profit before tax under EEV is £131 million higher at £254 million, reflecting the earlier timing of profit recognition, - Scottish Widows' profit before tax (excluding volatility, the strengthening of annuitant mortality reserves and other items) is £72 million higher at £727 million, as higher new business profit before tax is partially offset by the consequent lower profit on existing business, - Scottish Widows' embedded value is £908 million higher at £6,386 million, largely reflecting the inclusion of certain investment products under EEV. Lloyds TSB Group believes that EEV reporting better reflects the economic valueof Scottish Widows' in-force business. A live webcast of this event, together with a copy of the Transition to EEVdocument, will be available on our website www.investorrelations.lloydstsb.com/presentationpage.asp and a recorded version available shortly after the event. For further information: Michael Oliver +44 (0) 20 7356 2167 Director of Investor Relations E-mail: [email protected] Sarah Pollard +44 (0) 20 7356 1571 Senior Manager, Investor Relations E-mail: [email protected] FORWARD LOOKING STATEMENTS This announcement contains forward looking statements with respect to thebusiness, strategy and plans of the Lloyds TSB Group and its current goals andexpectations relating to its future financial condition and performance.Statements that are not historical facts, including statements about Lloyds TSBGroup's or management's beliefs and expectations, are forward lookingstatements. By their nature, forward looking statements involve risk anduncertainty because they relate to events and depend on circumstances that willoccur in the future. Lloyds TSB Group's actual future results may differmaterially from the results expressed or implied in these forward lookingstatements as a result of a variety of factors, including UK domestic and globaleconomic and business conditions, risks concerning borrower credit quality,market related risks such as interest rate risk and exchange rate risk in itsbanking businesses and equity risk in its insurance businesses, inherent risksregarding changing demographic developments, catastrophic weather and similarcontingencies outside Lloyds TSB Group's control, any adverse experience ininherent operational risks, any unexpected developments in regulation orregulatory actions, changes in customer preferences, competition, industryconsolidation, acquisitions and other factors. For more information on theseand other factors, please refer to Lloyds TSB Group's Annual Report on Form 20-Ffiled with the US Securities and Exchange Commission and to any subsequentreports furnished by Lloyds TSB Group to the US Securities and ExchangeCommission or to the London Stock Exchange. The forward looking statementscontained in this announcement are made as of the date hereof, and Lloyds TSBGroup undertakes no obligation to update any of its forward looking statements. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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