Lloyds Banking Group Plc · LSE:LLOY

Lloyds Banking — Merger or Acquisition (December 2016)

10 slides from Lloyds Banking's merger presentation, Dec 20, 2016

  1. Slide 1: Acquisition of MBNA

    TITLE SLIDE IS IN SENTENCE ACQUISITION OF CASE. MBNA GREEN BACKGROUND. Presentation to Analysts 20 December 2016 and Investors

  2. Slide 2: Transaction Overview

    TRANSACTION OVERVIEW Value generating acquisition of a prime credit card portfolio supporting our strategic goal to grow in consumer finance • £7bn prime credit card book with strong asset quality primarily operating under MBNA brand TRANSACTION • Consideration of £1.9bn: reflecting 15% premium over

  3. Slide 3: Acquisition Rationale

    ACQUISITION RATIONALE Creating shareholder value through strengthening our Consumer Finance business Best in class UK credit card business Strategic goal to grow in consumer finance • c.£16bn prime credit card portfolio(1) • Delivers sustainable growth through multi-brand strategy • Low risk portfol

  4. Slide 4: Creating a 'Best in Class' UK Credit Card Business

    CREATING A ‘BEST IN CLASS’ UK CREDIT CARD BUSINESS Low risk, customer-centric business with enhanced digital capabilities High quality customer base underpinned Customer-centric business with diversified by sound risk management distribution model • Prime customer base, with higher Demographics than

  5. Slide 5: Supports Strategic Goal to Grow in Consumer Finance

    SUPPORTS STRATEGIC GOAL TO GROW IN CONSUMER FINANCE Strengthening our customer proposition in an under-represented product area LBG market share(1) (%) Current account volumes 25 Retail deposit balances (2) 22 Mortgage balances(3) 21 Consumer cards balances 15 +MBNA 26 Lex Autolease fleet cars stock

  6. Slide 6: Creating Significant Value for Shareholders

    CREATING SIGNIFICANT VALUE FOR SHAREHOLDERS Strong financial returns supported by sizeable opportunity for synergies  Overall impact on total Group revenues of c.£650m Income +£650m  Enhances Group net interest margin by c.10bps per annum  Potential for revenue synergies, but not currently includ

  7. Slide 7: Transaction Funded Through Organic Capital Generation

    TRANSACTION FUNDED THROUGH ORGANIC CAPITAL GENERATION Strong balance sheet and capital generation provides strategic optionality Strong capital position and ongoing Impact on capital capital generation • Expected to utilise approximately 80bps of CET1 capital on 13.9% 14.1% 14.6% 13.0% completion in

  8. Slide 8: Appendix

    TITLE SLIDE IS IN SENTENCE APPENDIX CASE. GREEN BACKGROUND.

  9. Slide 9: Overview of MBNA Card Business

    OVERVIEW OF MBNA CARD BUSINESS Efficient, customer focused, credit card business with high quality, low risk portfolio well aligned to Lloyds existing proposition MBNA Portfolio breakdown(1) • UK’s #1 mono-line credit card issuer by balances 16% • Total balances outstanding of c.£7.0bn as at Jun 201

  10. Slide 10: Forward Looking Statements

    FORWARD LOOKING STATEMENTS FORWARD LOOKING STATEMENTS This document contains certain forward looking statements with respect to the business, strategy and plans of Lloyds Banking Group and its current goals and expectations relating to its future financial condition and performance. Statements that

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