Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — Debt Investor Presentation (October 2020)
24 slides from Lloyds Banking's debt investor presentation, October 2020
Slide 1: LBG Insurance Fixed Income Investor Presentation
LBG INSURANCE FIXED INCOME INVESTOR PRESENTATION • October 2020
Slide 2: Agenda
Classification: Public AGENDA TITLE SLIDE IS IN 1. Strategy SENTENCE CASE. 2. Performance GREEN BACKGROUND. 3. Solvency 00 Month 0000 4. Q&A Presenters Name 1
Slide 3: Strategy
Classification: Public STRATEGY 2
Slide 4: Simple group structure with multiple issuance points
Classification: Public Simple group structure with multiple issuance points HoldCo Lloyds Banking Group Main Entities A3 / BBB+ / A+ Ratings P-2 / A-2 / F1 Neg / Neg / Neg Example Products Senior Unsecured - Capital Ring-Fenced Sub-Group Non-Ring-Fenced Sub-Group Insurance Sub-Group Equity Investmen
Slide 5: Simplified Insurance Group Structure
Classification: Public Simplified Insurance Group Structure Insurance Sub-Group Scottish Widows Group Ltd HBOS Investment Fund Lloyds Bank General Scottish Widows Ltd Managers Ltd Insurance Holdings Ltd Lloyds Bank General St Andrews Insurance Scottish Widows Insurance Ltd plc Europe 4
Slide 6: Our strategy is to Help Britain Prosper by helping our customers protect today and secure tomorrow
Classification: Public Our strategy is to Help Britain Prosper by helping our customers protect today and secure tomorrow 5
Slide 7: UK's largest financial services provider 26m customers
Classification: Public Group business model is unique with distinctive competitive strengths UK’s largest financial services provider Our Helping Britain purpose Prosper 16.4m In 2019, we helped 26m Digitally active customers - we remain the UK’s 350,000 people save for their Best financial services
Slide 8: Uniquely positioned, integrated business, targeting growth in attractive markets
Classification: Public Uniquely positioned, integrated business, targeting growth in a number of attractive markets Franchise Direct Intermediary • Comprehensive insurance proposition, providing all financial needs in one place • Supported by unrivalled multi-brand and multi-channel model, including
Slide 9: Significant progress since 2015, capturing growth in key markets
Classification: Public Significant progress since 2015, capturing growth in key markets Market position1 Share New business CAGR Share ambitions Key growth (Dec 2019) Flow 2015 - 2019 Flow initiatives Market • Wider access to Workplace Workplace Pensions 14.5% +34% +17% 15% by 2020 pensions market s
Slide 10: Short term Covid-19 impacts felt across the business
Classification: Public Short term Covid-19 impacts felt across the business… Customer Support New Business Payment holidays on premiums and accelerated claims Life & pensions up 15% if Life & Pensions PVNBP payments for life and critical illness exclude auto-enrolment 8,568 8,947 -8% impact in 2
Slide 11: Longer term, expect increased focus on unmet financial resilience
Classification: Public …but longer term, expect increased focus on unmet financial resilience Unmet need for support in managing Covid-19 has increased focus on gaps in long- financial health term planning Homogeneous desire across of people feel they are unprepared for retirement £ customer segment
Slide 12: Continued development of tech offering
Classification: Public Continued development of tech offering <2018 2018 2018 / 2019 2020 2020+ • No modern tech • Digital Workplace • Engage customers • Scottish Widows app • Scaling Scottish Digital proposition pensions launched as a segment of one pilot launched with Widows app and for insurance
Slide 13: Schroders Personal Wealth – aiming to become a top 3 financial planning business
Classification: Public Schroders Personal Wealth – aiming to become a top 3 financial planning business by end of 2023 A unique proposition… …in an attractive market …well positioned to be Top 3 A clear ambition… Innovative product Referral channel allows for offering with wide inflows from >1m LBG
Slide 14: Performance
Classification: Public PERFORMANCE 13
Slide 15: Overview of H1 2020 Financials
Classification: Public Overview of H1 2020 Financials LP&I New Business Income (£m) Total Underlying Income (£m) Insurance & Wealth Underlying 1,223 Profit (£m) 340 659 288 1,011 968 1,039 949 268 258 875 244 867 470 480 429 447 407 379 153 128 H1 H2 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H2 H1 2017 2017 201
Slide 16: Solvency
Classification: Public SOLVENCY 15
Slide 17: Subordinated Debt Position
Classification: Public Subordinated Debt Position Scottish Widows Debt Instruments SWG Consolidated Group Subordinated Debt Profile (£m) (3,4) Call 1600 Issuer Tiering Coupon Issued Maturity Notional Date 1400 External SW Ltd Tier 2 5.5% Apr-13 Jun-23 Jun-23 £850m 1200 1000 SW Ltd Tier 2 7.0% Apr-13
Slide 18: Solvency Position Breakdown YE19
Classification: Public Solvency Position Breakdown YE19 150% Figures shown are for Scottish Widows Limited on a regulatory basis as shown in the SFCR Scottish Widows manages capital on a shareholder basis (i.e. excluding With Profits impact) at the Scottish Widows Group level: 163% at YE 2019
Slide 19: Solvency Position Breakdown YE19
Classification: Public Solvency Position Breakdown YE19 150 YE 2019 (£bn) SWL SWG Own Funds 7.7 8.3 Transitionals SCR 5.2 5.4 Regulatory Matching Ratio (post 150% 155% Adjustment dividend) SWL Capital Generation – Capital generation over 2019 primarily from capital initiatives such as recognition of
Slide 20: Solvency Position Breakdown
Classification: Public Solvency Position Breakdown Totals £7.7bn £15.5bn £9.6bn £0.7bn £5.2bn 150% Between risk category diversification benefit of 28% Source: Risk Breakdowns from Scottish Widows Group Solvency & Financial Condition Report 2019, Section C 19
Slide 21: 2018 – 2019 SWG Solvency Walk
Classification: Public 2018 – 2019 SWG Solvency Walk As the predominant entity within Insurance Group, SWL’s capital movements are materially consistent with SWG Eligible Own Notes £m Funds SCR 1) Changes in the valuation of underlying investment Opening balance : 31 December 2018 8,598 5,677 subsid
Slide 22: 2019 Risk & Capital Management Update
Classification: Public 2019 Risk & Capital Management Update Zurich UK The acquisition is a key enabler to accelerate the Group’s development of its financial planning and retirement Workplace business and completion of the Part VII transfer on July 1 2019, brought around £21bn of assets under acqui
Slide 23: Q&A
Classification: Public Q&A
Slide 24: Forward looking statements and basis of presentation
Classification: Public Forward looking statements and basis of presentation This document contains certain forward looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, and section 27A of the US Securities Act of 1933, as amended, with respect to
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