Non-ring-fenced bank
Lloyds Bank
Corporate Markets plc
Annual Report and Accounts 2024
1Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Connecting the UK
and LBG with the world
Helping Britain Prosper
2Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
In this report
Strategic report
3-35
Highlights 4
LBCM at a glance 5
Chief Executive’s review 6
Our strategy 9
Financial performance 15
People and culture 20
Stakeholder engagement 22
Principal risks and uncertainties 29
Governance
36-54
Chair’s statement 37
Our Board 39
Board of Directors 41
Our Executive Committee 43
Corporate governance statement 46
Other disclosures 50
Financial statements
55-126
Independent auditor’s report 56
Consolidated income statement 64
Statements of comprehensive income 64
Balance sheets 65
Statements of changes in equity 66
Cash flow statements 68
Notes to the consolidated
financial statements 69
Other information
127-129
Subsidiaries and related undertakings 128
Alternative performance measure 128
Forward-looking statements 129
Our reporting
Our reporting is designed to facilitate clear
communication to a range of stakeholders. LBCM’s
annual report and accounts provides disclosures
relating to our strategic, financial and operational
performance and provides details on our strategy.
Key indicators of performance: the Bank’s Board
of directors regularly monitors indicators of
performance including strategic progress, business
performance and appropriate levels of capital,
funding and liquidity.
To access more content on a mobile device, point
your camera at the QR codes seen throughout
this report. Supplementary information and
disclosures are provided in the Pillar 3 report.
This annual report and accounts document
contains forward-looking statements relating to
LBCM’s future financial condition, performance,
results, details of our strategy and objectives.
For further details, please refer to our forward-
looking statements on page 129.
Throughout this document we are proud to
feature LBCM colleagues.
Definitions
Lloyds Bank Corporate Markets plc (the Bank) and
its subsidiary undertakings (together the Group).
References within this document to LBCM refer
to the Group as defined here. Lloyds and Lloyds
Bank are trading names of Lloyds Bank Corporate
Markets plc.
company of LBCM and is also referred to as LBG
in this document.
Approval
The 2024 annual report and accounts
incorporates the strategic report and the
consolidated financial statements, both of which
have been approved by the Board of directors.
On behalf of the Board
Carla Antunes da Silva
Chief Executive Officer (CEO)
Lloyds Bank Corporate Markets plc
26 February 2025
See the full LBCM reporting
suite on the Investors page
of the website.
3Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
In this section
Highlights 4
LBCM at a glance 5
Chief Executive’s review 6
Our strategy 9
Financial performance 15
People and culture 20
Stakeholder engagement 22
Principal risks and uncertainties 29
Strategic
report
4Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Highlights
Strong financial
performance from
a growth business
that’s delivering more
for our customers
Total income
£984m
Record total income for LBCM
demonstrating delivery of more
support to customers, continued
business momentum and growth
driven from strategic investment.
Find out more about our financial performance
See page 15
Profit before tax
£501m
Up 17% on 2023
Return on tangible equity
11.2%
Disciplined balance sheet usage
CET1 ratio
13.6%
Strongly capitalised bank
5Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
4. Digitising and growing our
Crown Dependencies business.
2. Scaling our global capital markets franchise.
LBCM at a glance
Connecting the UK and
LBG with the world
We are part of the Corporate
and Institutional Banking
(CIB) business unit of Lloyds
Banking Group and core to
LBG’s growth strategy.
Our core business areas are:
global financial markets,
global capital markets,
lending and in the Crown
Dependencies retail and
commercial banking.
Our geographic hubs
• UK
• Jersey
• Guernsey
• Isle of Man
• New York, USA
• Frankfurt, Germany
Our strategy
Our customers
Our competitive advantages
• Leading UK customer
franchise with deep
client insight as
part of Lloyds
Banking Group.
• Diversified
business model,
with cost discipline,
meeting a wide range
of client needs.
• Financial strength
with strong risk
management and
capital position,
enabling significant
investment.
• Dedicated and
purpose-driven
colleagues, with
strong values and
customer service.
The target market for our products and
services in the UK and internationally is made
up of large corporates and financial institutions
plus retail and commercial customers in the
Crown Dependencies.
>275,000
customers and clients
Our colleagues
We have a highly engaged, client-
focused and diverse workforce
with significant expertise and
experience to deliver these
products and services.
>1,100
colleagues
Our values
Our values are the foundation of our
culture and underpin the work of our
colleagues and the decisions we make.
Trust
People-first
Bold
Inclusive
Sustainable
To provide a first-class banking, financing and risk management proposition,
underpinned by excellent customer service. Our strategic pillars are:
Global Markets International
1. Expanding our global financial markets
client proposition.
3. Strengthening our presence in
North America and Europe.
Our structure
Lloyds Banking Group
Lloyds Bank
Corporate Markets plc
Ring-Fenced
Banks
Scottish Widows
Group Ltd
Insurance
LBG Equity
Investments Ltd
Investments
6Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Chief Executive’s review
Strong results in 2024
LBCM has delivered a strong set of financial
results in 2024 against a backdrop of
uncertainty and a turbulent geopolitical
climate. Total income was £984 million, a
record high for LBCM, reflecting the growth in
the business and doing more for our customers.
Profit before tax of £501 million was up 17 per
cent on 2023 with return on tangible equity
increasing to 11.2 per cent demonstrating
sustainable returns from disciplined balance
sheet usage. A strong capital position was
maintained with CET1 ratio of 13.6 per cent and
a leverage ratio of 4.5 per cent. More analysis
of the results can be found in the financial
performance section on page 15.
Delivering sustainable
growth and returns
These results reflect the ongoing successful
delivery of the LBCM strategy as part of
LBG’s Corporate and Institutional Banking
division which is an important engine of other
operating income growth for LBG. LBCM
has increased its direct contribution to the
LBG results and has also driven increased
income to other areas of LBG. Since the
commencement of the current strategy
LBCM’s total income has increased by 54 per
cent (from £641 million in 2021 to £984 million
in 2024) and profit before tax has increased
73 per cent (from £289 million in 2021 to £501
million in 2024). These impressive increases
in both total income and profit before tax
reflects broad-based, sustainable growth
across our businesses enabled by ongoing
significant investment in our platforms.
Our track record of success over the period
is testament to the hard work of LBCM
colleagues delivering more support to
our customers and clients across a broad
product range and diversified business.
Deepening relationships and
expanding institutional coverage
During the year we have continued
to expand institutional coverage and
deepen relationships across our corporate,
institutional and consumer customer
base, all aligned to our purpose-driven
strategy of Helping Britain Prosper.
LBCM delivered a strong financial performance in 2024, from
a growing business that is delivering more for our customers.
Investment in our systems and people is enabling the scaling
of our businesses and this positive momentum positions us
well to deliver future growth with sustainable returns.
Carla Antunes da Silva Chief Executive Officer
We have grown our
client franchise and
reach, delivering strong
results and increased our
contribution to LBG
7Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Chief Executive’s review continued
2024 highlights
• Record financial performance with
total income of £984 million and return
on tangible equity of 11.2 per cent
• Ongoing significant investment in our
systems and product capabilities across
both global markets and international
• Enhanced our market presence with
the launch of ‘Lloyds Bank Market
Insights’ and our flagship annual
Markets Summit
• Global markets
– Best Bank – FX Trading for
corporates in Europe
– Number 1 in ESG-labelled bond
issuance for UK corporates
– 1st for overall service quality
in the interest rate derivatives
Greenwich survey
– Supported clients with an offering
of over 100 commodity indices
• International
– International private banking app
launched
– New ‘Eco Home’ proposition
– Best ‘all rounder bank’ for expats
– Increased lending in North America
Significant investment in platforms across
our businesses has been a key enabler to us
in achieving this growth in client numbers and
increased product penetration.
In financial markets, enhancements to rates
and foreign exchange product capabilities plus
additional commodity indices have allowed
us to support clients on a larger scale in risk
management and hedging activity. In capital
markets, systems development and new
product build have taken place, including on
our suite of ESG-labelled bonds (where we
remain number 1 with UK corporates). In the
Crown Dependencies business significant
progress has been made in building digital
solutions across our platforms including in
international private banking (new app),
cash management and payments (increased
functionality) and community banking (new
Eco Home product). Overall we strive to
ensure our products and offerings meet
our client and customers’ evolving needs.
Looking ahead to 2025 investment for the
LBCM business increases on the back of our
strong performance, with the priority to
further improve the resilience and efficiency
of our core markets systems and build modern
flexible technology, together with the building
out of our international presence supporting
the CIB strategy. This expansion of our existing
franchise in North America and Europe will
enable CIB to strengthen its UK business,
deliver additional growth above the cost
of capital, diversify revenues and be more
relevant to clients in their key geographies.
Continued collaboration across LBG remains
crucial as we bring the whole LBG offering
to our clients and customers, delivering
more of their financial needs. Refer to our
strategy section on page 9 onwards for
more information on our strategic progress.
Colleagues
LBCM has a broad range of customers and
clients from individuals to large corporates
and financial institutions. Our success, delivery
for our customers and clients, and business
growth are only possible due to the hard work
and collaboration of colleagues across the
UK, North America and Europe. I would like to
thank them all for their ongoing commitment
and brilliant execution over the year. We have
achieved so much together and I am confident
there is much more to come!
Making LBCM a great place to work will always
be a priority for me and my leadership team.
We are committed to using colleague feedback
to create a place where everyone can thrive
and be the best version of themselves,
particularly given the different geographies
and business areas that make up our business.
For example, we have worked with our senior
colleagues to help them become better
leaders for our teams and also delivered
critical skills training. Amongst some great
diversity, equity and inclusion initiatives in the
year, I have been delighted to be the sponsor
of a gender workstream, seeking to retain and
attract top-tier female talent to our business.
Showcasing LBCM
Building the bank’s profile and showcasing
capabilities of our businesses remains
important. I was thrilled to host over 200
clients at our flagship Lloyds Bank markets
conference in London in October and we
also launched ‘Lloyds Bank Market Insights’.
This innovative service provides our clients a
one-stop shop of economic reports, market
intelligence, expert analysis and forecasts to
help them navigate macroeconomic changes
with confidence. More details on both can be
found on the next page.
Conclusion
Finally, I was pleased to welcome Nathan
Bostock as our new Chair in summer 2024
and note how much we are benefiting from
his knowledge and experience. I would also
like to express my thanks to the Board and
Executive Committee for their support and
dedication over the year.
I am delighted with the strong results, business
growth and strategic progress made by LBCM
in 2024. It’s been a great year of delivery for
our clients and customers by our colleagues.
I am encouraged by the tangible momentum
of our business for the years ahead and am
confident we will build on these strong results
through continuing to invest in our platforms,
products, colleagues and proposition.
Carla Antunes da Silva
Chief Executive Officer
8Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Chief Executive’s review continued
Lloyds Bank Markets Summit 2024
Today, markets are more
than just engines of growth –
they are vital stabilisers
in times of volatility
Managing risk to finance growth
Our flagship annual Markets Summit took
place in October in London, attended by
over 200 clients and special guests. It was a
great opportunity to showcase the thought
leadership and insight that LBCM can provide
and the event highlighted the important role
markets play in an evolving landscape.
Throughout the conference the attendees
explored how, as well as being engines
of growth, markets are vital stabilisers in
times of volatility. Markets products can
give businesses the time and means they
need to respond to unforeseen challenges
and can help drive innovation too by
providing the capital necessary for growth.
However, their role in buffering against shocks
is just as vital with markets offering the tools
to manage currency risk and interest-rate
fluctuations while providing access to long-
term funding. This in turn allows businesses to
navigate uncertainty with confidence and this
dual function – acting as a catalyst for growth
and a stabiliser – provides companies with the
mechanisms they need for long-term success.
In addition to valuable networking
opportunities, there were high-profile
speakers including Paul Johnson (Director,
The Institute of Fiscal Studies), Rory Stewart
(former Secretary of State for International
Development), Sir Robin Budenberg (Chair,
Lloyds Banking Group) and Nathan Bostock
(Chair, LBCM).
Lloyds Bank Market Insights
Clients can easily stay ahead with the latest
updates in macroeconomics and financial
markets from the team at LBCM. Our one-
stop shop of economic reports, market
intelligence, expert analyses and forecasts
can help clients navigate macroeconomic
changes with confidence.
Launched in 2024, our full range of insightful
market-driven reports is now available to
subscribe to free of charge, and includes:
• Daily reports: Get prepared for the day’s
economic outlook.
• Monthly reports: Exclusive UK sector
analysis and monthly temperature gauge.
• FX: Analysis of emerging and topical themes.
• Responsive reports: Stay informed
about timely economic events.
• Rates: Insight into emerging and topical
themes in the fixed income markets.
• Invites to live calls around key market
events.
Our markets team are specialists across
a range of areas and provide a considered
and intelligent view on the UK economy
and global economic developments, analysis
and forecasting of economic trends, macro
and behavioural economics and both FX
and interest rate strategies.
Insights can be received direct
to your inbox – register here
EUROMONEY
The themes of the Markets Summit and
managing risk to finance growth were
covered by the Euromoney magazine
following the event. In their ‘Market
Voices’ series with Carla Antunes da Silva,
they covered how markets are adapting
to the challenges of the new normal and
are crucial in helping firms to navigate the
turbulent geopolitical climate.
Notable industry experts also joined us for
panel discussions including Dame Julia
Hoggett (CEO, London Stock Exchange),
Jessica Pulay (CEO, UK Debt Management
Office), Stephan Jansma (CFO, Trafigura),
Nael Khatoun (Portfolio Manager, Oaktree
Capital Management), Rachel Lord (Head of
International, Blackrock) and Ben Clissold
(Head of Fixed Income & Treasury, USS
Investment Management).
9Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Our strategy
Connecting
the UK and LBG
with the world
Global Markets
1. Expanding our global financial
markets client proposition
Investment in our platforms to enable
expanded offerings and collaboration
with more clients and on a larger share
of their activities.
2. Scaling our global capital
markets franchise
Driving growth through investment in
platforms and provision of specialised
expertise across financing structures.
International
3. Strengthening our presence in
North America and Europe
Deepening our presence in these markets
to partner with clients across a greater
proportion of their financing activities.
4. Growing and digitising our
Crown Dependencies business
Investing in technology and our platforms
is key to our commitment to improving the
customer experience.
LBCM connects the UK and LBG to global markets
through a first-class banking, financing, and risk
management proposition, underpinned by strong
customer service.
Guided by our purpose of Helping Britain Prosper, LBCM has a well-defined
strategy of investing in both our markets and international businesses which is
driving sustainable income growth and returns. Core to this strategy is deepening
client relationships, expanding our institutional coverage and driving collaboration
opportunities across LBG.
10Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Our strategy continued
Expanding our financial
markets client proposition
Lloyds Bank financial markets
LBCM is enhancing client propositions through
strategic investment in rates and foreign
exchange products. In a rapidly evolving
environment, our platform investments
support us in providing a superior client
experience, expanded offerings, and
improved operational efficiency so we can
boost our transaction volumes and leverage
our natural market presence, particularly
with our institutional clients.
We aim to collaborate with clients on a larger
share of their risk management and hedging
activities, while maintaining a disciplined
approach to risk and capital allocation. An
enabler for this involves diversifying our offering
so that we can deliver bespoke and more
complex solutions, that leverage our expertise,
for UK and global clients facing into macro
events and regulation changes.
LBCM is supporting corporate clients from
hard-to-abate sectors to participate in
the UK and EU mandatory ‘cap-and-trade’
schemes. In 2024, LBCM has increased its
activity in these compliance markets by
20 per cent in both quantity of trades and
number of active clients. At the same time,
we continue to monitor the voluntary carbon
market as it develops, and more standardised
guidance is published.
The business is tracking well against its
externally committed rankings and continues
to deliver on investment. We have
deepened our FX wallet share by investing
in technology including our new electronic
benchmark capabilities. In 2024 we were
proud to be awarded ‘Best Bank – FX Trading
for Corporates in Europe’ by Coalition
Greenwich and delivered a 42 per cent year
on year increase in foreign exchange volumes.
We achieved our strategic objective of Top 5
sterling interest rate swaps ranking.
In a year of heightened volatility and
macroeconomic uncertainty, the global
financial markets business has performed well.
Global
Markets
2024 progress
• Best bank FX trading for Corporates
in Europe
• 1st overall service quality in interest
rate derivatives Greenwich survey
1
• First supply-side carbon credit
transaction across LBG
• Supported clients on hedging needs,
offering over 100 commodity indices
in GBP interest rate swaps ranking
2nd
in line with CIB’s target of top 5
1. Coalition Greenwich Voice of Client – 2024
UK Corporate Interest Rate Derivatives Study.
Our products
• Rates (including inflation)
• Repo
• Foreign exchange
• Commodities
In 2024 global financial markets
had record FX volumes, continued
to diversify the client offering
and invested in improving
technology capabilities
11Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Our strategy continued
Scaling our global capital
markets franchise
Lloyds Bank capital markets
Ongoing investment in our capital markets
business is enabling continued growth and
scaling at pace of an already strong presence
in GBP specifically and global capital markets
more broadly. Our capital markets business
provides clients with specialised expertise
across an array of financing structures,
including innovative and structured finance
solutions, effective liability management
and sustainability initiatives.
Demonstrating this growth, LBCM’s
sustainable financing across ESG labelled
primary bond issuances, sustainability-
linked loans and green lending has nearly
doubled in the year, materially contributing
to LBG’s Commercial Banking sustainable
finance target of £30 billion between 2024
and the end of 2026.
In April, LBCM supported LBG with the launch
of its Sustainable Bond Framework, followed
by two green use of proceeds bond issuances.
The capital markets team is positioned well to
assist clients in raising bond financing in sterling,
euros, and US dollars, alongside offering expert
credit trading and rates risk management
services that complement issuance.
In a competitive landscape, the business
benefited from an expanded portfolio of
corporate clients and increased financial
institutions debt capital markets coverage
which led to robust levels of issuance
activity. This resulted in a strong year
overall for capital markets.
2024 progress
• 1st for ESG-labelled bond issuances
for sterling bonds across all issuers
1
• Ranked 3rd for all GBP investment
grade FI bonds
2
• Strong growth in US dollar and euro
bond volumes
• Inaugural social private placement
to affordable housing provider
1. Bond Radar.
2. Excluding corporates, ABS. Including global issuers.
ESG-labelled bond issuances for
UK corporates
1
1st
• Debt capital markets
• Credit trading
• Securitisation
• Corporate risk management solutions
Our global capital
markets business
supports our clients
in raising long-term
funds in sterling,
US dollars and euros
Global
Markets
Our products
12Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Our strategy continued
Strengthening our presence in
North America and Europe
Lloyds Bank North America
and Europe
LBCM, supporting Corporate & Institutional
Banking division, is focused on disciplined
expansion in the US and Europe to enable
us to meet additional client needs in these
key geographies, providing access to the
deepest capital markets in the world and
strengthening our core franchise.
To support our global clients, we provide
comprehensive funding and risk management
solutions across a core set of competencies in
key markets. This includes offering expertise
across banking products, secured and
unsecured debt capital markets across
sterling, euro and US dollar currencies,
supplemented by strong credentials in risk
management products such as Rates, FX
and Commodities.
A significant proportion of capital markets
issuance by CIB UK issuers is denominated in
euros and US dollars with most CIB customers
engaging in international trade, particularly
with Europe and the US as key partners.
LBCM is therefore committed to deepening
its presence in euro and US dollar markets
to better support customers in their
financing activities. This will be achieved
by growth in our global capabilities through
ongoing investment in our operations in
North America based in New York City
and Germany based in Frankfurt.
Leveraging our strong expertise in key global
sectors and geographies also helps to deepen
our footprint in these regions and enhances
LBCM’s competitive edge and ability to
provide tailored solutions across all clients.
International
2024 progress
• Growth in our Frankfurt-based
primary and secondary bonds
business
• Deepened client relationships and
increased lending in North America
• Acted as a joint bookrunner on a
€2 billion triple-tranche green bond
in Europe
• Capital markets
• Financial markets
• Lending
LBCM is focused on
supporting UK-linked
clients with a broad
spectrum of products
in their key geographies
Our Segments
13Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Our strategy continued
Lloyds Bank Crown Dependencies
Our commitment to investing in technology
to improve both the customer experience
and offering is driven by the ambition
to be the most recommended bank for
expats globally and for customers with
international needs. As part of this investment
we successfully launched the International
private banking app, enhancing the Crown
Dependencies digital proposition and support
for our non-sterling account holders. This has
been successful in servicing our digitally active
customers and business growth through new
applications since launch.
To support and broaden our institutional
customer base, whilst also investing for our
future growth, we have enhanced our cash
management and payments platform to
provide greater functionality.
Recognising the importance of sector
expertise and building upon our existing skill
base, we have made key hires to enhance our
market presence. This specialist knowledge
and improved ease of doing business through
technology investments has supported our
drive for sustainable growth within our
target markets.
Through the strength of our sustainability
expertise and market-leading green use of
proceeds structure, we stood out from our
competitors to win significant transactions
during the year. To further support our
customers on their journey to a sustainable
future, we successfully developed and
launched our three-stage ‘Eco Home
Hub’. This provides our customers with a
comprehensive resource and funding support
for green initiatives that are available to them.
Our Segments
• International private banking
• Community banking
• Commercial banking
• Motor finance
Growing and digitising our
Crown Dependencies business
International
International private banking app
>26,000
downloads in 2024 since launch
2024 progress
• Launch of the international private
banking app
• Enhanced functionality of cash
management platform
• Development and launch of a three-
stage ‘Eco Home’ proposition
• Awarded ‘best all rounder’ bank
for expats 2024
With customers’
digital requirements
increasing, 2024
has been a pivotal
year to enhance
our digital offering
14Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
John Winter
Corporate and
Institutional Banking
Chief Executive
Our strategy continued
Connecting our clients to
products across LBG
LBCM is an integral part of the CIB
business unit of LBG and core to its
growth strategy.
Under the leadership of CEO John Winter,
CIB serves the financial needs of large clients
(generally more than £100 million turnover)
who have a strong link to the UK from bases
in the UK, the USA and Europe.
CIB’s purpose-led and disciplined growth
strategy builds on expertise in debt financing,
risk management and transaction banking.
LBCM’s strategy is a fully integrated and core
part of CIB, and John regularly attends the
LBCM Board to take part in discussions.
As part of CIB, LBCM’s client engagement and
relevance have increased; and driven further
collaboration across LBG including Scottish
Widows, Tusker, Blackhorse
and Lex Autolease.
Utilising the significant scale and reach of the
wider group, we are successfully unlocking
opportunities and connecting clients to the
broader offering from other parts of LBG.
Focused on meeting a greater proportion of
client needs, LBCM and CIB are an important
source of LBG’s diversification and growth in
both revenue and other operating income. This
includes delivering balance sheet efficiency,
risk management solutions, supporting capital
issuance and providing ESG expertise.
For over 325 years LBG
has supported Britain,
helping people and
businesses invest and grow.
Today is no different
We have a unique breadth
of perspective, knowledge,
and capabilities to support
our clients’ growth and long-
term resilience. LBCM
supports clients by
managing risk and
unlocking capital
Charlie Nunn
LBG Group Chief
Executive
15Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
2020 20222021 2023 2024
£908m£641m £967m£544m £984m
2020 20222021 2023 2024
9.2%7.4% 13.4%0.1% 11.2%
2020 20222021 2023 2024
£427m£289m £477m£45m £501m
2020 20222021 2023 2024
13.3%13.1% 14.6%14.8% 13.6%
Financial performance
Strong financial
performance
Strong financial performance from
a growth business that’s delivering
more for our customers.
In 2024 LBCM achieved record total income and our highest ever
profit before tax, demonstrating delivery of more support to
our customers, continued business momentum and sustainable
growth enabled by strategic investment. Return on tangible
equity has improved through disciplined balance sheet usage
and a strong capital position has been maintained.
£501m
Profit before tax
1
Statutory return
on tangible
equity
1,2
11.2%
Common equity
tier 1 ratio
3
13.6%
Total income
£984m
1. LBCM Group.
2. Refer to other information section for basis of calculation.
3. Bank.
16Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Financial performance continued
Income statement
Total income was £984 million comprising
net interest income of £166 million, net fee
and commission income of £268 million, net
trading income of £552 million and other
operating expense of £2 million.
Within net trading income our capital and
financial markets businesses have delivered
strong performances in 2024 resulting in a 25
per cent increase to £552 million versus the
prior year. This is driven by growth across the
markets businesses including year-on-year
increased volumes across rates, gilts, foreign
exchange and commodities.
Net fee and commission income has increased
by £4 million, or 2 per cent year-on-year, driven
by the strong performance in our bond issuance
from debt capital markets, along with fees from
customer lending.
Net interest income of £166 million was down
16 per cent in 2024 compared to the prior
year, noting that in 2023 a one-off gain was
recognised. Additionally, interest paid on
customer deposits has increased along with
funding costs of the business.
Delivering for CIB and LBG: The strong 2024
results from our other operating income lines
of net fee and commission income and net
trading income has significantly contributed
to the results of our parent company, with
LBCM representing 14 per cent of LBG’s other
operating income, up from 13 per cent in 2023.
Operating expenses, including the new Bank
of England Levy, have reduced by £10 million in
the year to £499 million. They predominantly
consist of management charges relating to
the Intra-Group Agreement and staff costs
payable to Lloyds Bank plc.
LBCM maintained a strong focus on cost
management in 2024 despite the impact
of a sector wide change of the charging
approach for the Bank of England Levy in the
first quarter of 2024. Excluding this new levy,
operating expenses were actually down £19
million, or 4 per cent, in 2024 highlighting
strong cost management.
An offsetting benefit has been recognised
through income over the remainder of the year
which has reduced the impact of the new levy
charge on profit.
Total income
£984m
Net trading income
£552m
Net fee and commission income
£268m
Delivering sustainable growth in 2024
An impairment credit of £16 million has
been recognised in 2024. This expected
credit loss income reflects improvements
in the macroeconomic outlook in the year.
There have been no significant new stage 3
charges in the year. Please refer to note 9 for
more details.
A tax charge of £97 million was recorded
and more details are contained in note 10.
2024
£m
2023
£m
Movement
£m
Movement
%
Net interest income 166 198 (32) (16)
Net fee and commission income 268 264 4 2
Net trading income 552 442 110 25
Other income (2) 4 (6)
Total income 984 908 76 8
Operating expenses (499) (509) (10) (2)
Impairment credit 16 28 (12)
Profit before tax 501 427 74 17
Tax charge (97) (89) (8)
Profit after tax 404 338 66 20
Income statement
17Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Financial performance continued
Total liabilities were £91,143 million at
31 December 2024, compared to £86,451
million at 31 December 2023.
Customer deposits increased year-on-
year by 5 per cent in line with LBCM’s strategy
to grow deposits. The increase in financial
liabilities at fair value through profit or loss
is in line with our planned business growth in
repurchase agreements over the year.
Derivative financial instruments decreased
by £988 million mainly due to movements
in fair value. Debt securities in issue include
commercial paper, certificates of deposit and
Euro Medium Term Notes (EMTN). Increases
in our commercial paper in 2024 are offset by
maturities in our EMTN.
2024
£m
2023
£m
Movement
£m
Movement
%
Deposits from banks 2,645 2,078 567 27
Customer deposits 30,945 29,439 1,506 5
Due to fellow LBG undertakings 1,512 1,213 299 25
Financial liabilities at fair value through profit or loss 22,981 19,686 3,295 17
Derivative financial instruments 16,588 17,576 (988) (6)
Debt securities in issue 15,090 15,378 (288) (2)
Subordinated liabilities 746 755 (9) (1)
Other liabilities 636 326 310 95
Total liabilities 91,143 86,451 4,692 5
Subordinated liabilities is the Bank’s Tier
2 capital. The increase in other liabilities
compared to the prior year end relates to
trading settlement balances falling due over
the year end.
a
b
c
d
e
Total liabilities breakdown – 2024
a. Deposits
b. Financial liabilities
at fair value through
profit or loss
c. Derivative financial
instruments
d. Debt securities
in issue
e. Other
2024
£m
2023
£m
Movement
£m
Movement
%
Cash and balances at central banks 20,308 20,201 107 1
Financial assets at fair value through profit or loss 25,765 21,989 3,776 17
Derivative financial instruments 22,416 22,606 (190) (1)
Financial assets at amortised cost 25,056 24,891 165 1
Other assets 1,427 640 787 123
Total assets 94,972 90,327 4,645 5
Balance sheet assets Balance sheet liabilities
Total assets were £94,972 million at
31 December 2024, an increase of £4,645
million on the prior year, mainly driven by
an increase in financial assets at fair value
through profit or loss compared to the prior
year end. This increase in financial assets at
fair value through profit or loss is a result
of planned business growth in the reverse
repurchase agreement and gilts business areas.
Financial assets at amortised cost includes
loans and advances to banks of £1,255 million,
reverse repurchase agreements of £5,332
million and loans and advance to customers
of £17,800 million which have risen by £1,353
million year-on-year reflecting increased lending
to clients in our financial sponsors business.
Cash and balances at central banks are
broadly unchanged from the prior year end
and relate to balances on deposit at the Bank
of England and US Federal Reserve which
forms part of our liquid asset portfolio.
The derivative financial instruments balance
of £22,416 million is down slightly reflecting
mainly movements in fair value. Other assets
increased compared to the prior year as a
result of trading settlement balances falling
due over the year end.
a
b
c
d
e
Total assets breakdown – 2024
a. Cash and balances
at central banks
b. Financial assets at
fair value through
profit or loss
c. Derivative financial
instruments
d. Financial assets
at amortised cost
e. Other assets
18Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Balance sheet equity – 2024
a. Share capital
b. Retained profit &
other reserves
c. Other equity
instruments
Financial performance continued
2024
£m
2023
£m
Movement
£m
Share capital 370 370 –
Other reserves (236) (313) 77
Retained profits 2,887 3,011 (124)
Ordinary shareholder equity 3,021 3,068 (47)
Other equity instruments 808 808 –
Total equity 3,829 3,876 (47)
2024
£m
2023
£m
Movement
£m
Common equity tier 1 capital 2,797 2,725 72
Tier 1 capital 3,580 3,508 72
Total capital 4,171 4,109 62
Total risk-weighted assets 20,605 20,492 113
CET1 % 13.6% 13.3% 0.3pp
Leverage % 4.5% 4.7% (0.2)pp
Balance sheet equity Regulatory capital
Total equity was broadly flat year-on-year
at £3,829 million compared to £3,876
million at 31 December 2023. Profit after
tax attributable to ordinary shareholders
generated through strong business growth
in the year was offset by the payment
of a £450 million dividend to the Bank’s
parent company.
The movement in other reserves of £77 million
relates to the cash flow hedging reserve,
representing the fair value movements
and transfers to income statement on the
structural hedge.
More details are contained in notes 23 to 27.
Regulatory capital
The capital position of Lloyds Bank Corporate
Markets plc (the Bank) is presented on an
unconsolidated basis.
The Bank’s common equity tier 1 (CET1)
capital ratio increased to 13.6 per cent
(31 December 2023: 13.3 per cent). Profit for
the year was partially offset by an increase in
regulatory adjustments and a slight increase
in risk-weighted assets (RWAs).
The Bank’s total capital ratio increased
slightly to 20.2 per cent (31 December 2023:
20.1 per cent). This reflects the increase in
CET1 capital, partially offset by the increase
in risk-weighted assets.
RWAs increased by £113 million, or 0.5 per
cent, to £20,605 million at 31 December
2024 (31 December 2023 £20,492 million),
largely reflecting an increase in credit risk,
counterparty credit risk and operational risk,
partially offset by a decrease in market risk.
Full details are included within the LBCM 2024
year-end Pillar 3 report.
The Bank’s UK leverage ratio decreased to 4.5
per cent at 31 December 2024 (31 December
2023: 4.7 per cent). This largely reflects the
growth in securities financing transactions
and gilts and an increase in the measure for
derivative instruments.
a
b
c
19Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Financial performance continued
The Bank’s capital position as at 31 December 2024, after applying IFRS 9 transitional
arrangements, is set out in the following table.
Capital resources of the Bank
2024
£m
2023
£m
Common equity tier 1
Shareholders’ equity per balance sheet 3,019 3,091
Adjustment to retained earnings for foreseeable dividends – (450)
Cash flow hedging reserve 219 289
Debit valuation adjustment (28) (22)
3,210 2,908
Less: deductions from common equity tier 1
Prudent valuation adjustment (130) (142)
Excess of expected losses over impairment provisions and value adjustments (279) (41)
Goodwill and other intangible assets (4) –
Common equity tier 1 capital 2,797 2,725
Additional tier 1
Additional tier 1 instruments 783 783
Total tier 1 capital 3,580 3,508
Tier 2
Tier 2 instruments 691 699
Other adjustments (100) (98)
Total tier 2 capital 591 601
Total capital resources 4,171 4,109
Risk-weighted assets of the Bank 20,605 20,492
Capital ratios of the Bank
Common equity tier 1 capital ratio 13.6% 13.3%
Tier 1 capital ratio 17.4% 17.1%
Total capital ratio 20.2% 20.1%
20Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
People and culture
The importance of
people and culture
Our colleagues are essential to the success of
LBCM and we are committed to building an
inclusive and sustainable organisation that is
truly representative of modern-day Britain.
We want differences to be embraced and everyone to reach their
potential. We recognise that colleagues who can be their authentic
selves at work are central to our success.
Our values are the foundation of our culture and give us clarity on what’s
important and how colleagues work together. This is fundamental to
supporting us to deliver our purpose and growth strategy.
Our
values
People-first
We put people first to go further for customers. We listen and care
for people as individuals.
Trust
We trust each other to achieve more together. We give each other
the space and support to take things on and see them through.
Sustainable
We champion sustainability to care for our planet. We take responsibility
for the impact of our actions on nature and Britain’s transition to net zero.
Bold
We’re bold and take action. We innovate and do things differently to
better serve our customers and grow with purpose.
Inclusive
We’re inclusive to value everyone. We learn about and embrace our
differences, and seek out diverse perspectives.
21Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
People and culture continued
Colleague engagement
In 2024, we broadened and deepened how
we listen to our colleagues to provide a more
regular and complete picture of sentiment. This
included evolving our pulse and annual surveys
by providing greater alignment to our strategy
and purpose, with further changes to the survey
made to improve the colleague experience.
Flexible working is an important part of our
proposition and all colleagues have access to
a range of flexible working options depending
on their role.
and progression within LBG, and actively
supporting Black heritage communities
across the UK.
LBG 2030 goals are between 3.5 per cent and
4 per cent for Black heritage and 19 per cent
and 22 per cent for Black, Asian Minority Ethnic
representation at executive levels in the UK.
Disability and neurodiversity
Since launching the goal to double the
representation of senior colleagues with
disabilities in 2023 there’s been a significant
uplift in the number of colleagues sharing
their disability data. Our aspiration is for
80 per cent of UK colleagues to have shared
their data with us by the end of 2025.
80%
2025 aspiration for UK
colleagues to share their
disability data
19% to 22%
2030 goal for Black,
Asian and Minority Ethnic
colleagues representation
at executive levels in the UK
Inclusion and diversity
As part of LBG, the approach and plans in
this area have been refreshed in 2024, but
remain centred around the guiding principle
of Inclusive Every Day, underpinned by four
inclusion pillars – insight, behaviours, design,
and society.
The following sections reflect the ambition of
LBG overall, of which LBCM is a key part. LBG’s
targets and ambitions are subject to local laws
and regulations. More details can be found in
the LBG annual report and accounts.
Gender diversity
The focus is on enhancing the talent pipeline
to achieve a gender balance, championing
gender equality for all, and promoting allyship
and inclusive leadership. The aim is to reach
a consistent gender balance of 45 per cent
to 55 per cent in executive roles by the end
of 2030.
Sexual orientation and
gender identity
We continue to focus on building an inclusive
and open working environment for our
LGBTQ+ colleagues and our LGBTQ+
colleague network Rainbow continues
to play a pivotal role in our approach to
supporting our colleagues.
Ethnic diversity
We are committed to addressing racial
inequalities to help build an inclusive society
and create an organisation that reflects
the diverse community we serve. While
steady progress has been made in increasing
representation of Black, Asian, Minority Ethnic
senior representation, we remain focused
on further acceleration. To achieve this, we
are looking closely at the colleague life-cycle,
enhancing representation in key growth areas
such as technology and data, and continuing
to upskill our workforce and leadership.
We continue to be guided by the principles of
our 2020 Race Action Plan, which focuses on
driving cultural change, improving recruitment
22Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Stakeholder engagement
Engaging with
our stakeholders
(including section 172(1) statement)
Governance in action
The Board continues to engage both directly
and indirectly with its stakeholders, helping
not just in providing a better understanding
of their points of view, but also of the impact
LBCM has in their day to day lives. Beyond
the Board, stakeholder engagement takes
place at all levels within the organisation,
and in addition to the direct engagement of
Board members with stakeholders discussed
on the following pages, the Board requires
stakeholder implications to be considered
within all proposals submitted from across
the organisation.
Senior management routinely provides the
Board with details of stakeholder interaction
and feedback through their regular business
updates and during their interactions both
inside and outside the boardroom.
Managing stakeholder interests also forms
a key part of the Board’s delegation of the
day-to-day management of the business to
senior management.
The directors acknowledge that one of the
primary responsibilities of the Board is to
ensure the strategy of the Bank, as aligned
to that of LBG, achieves long-term success
and generates sustainable returns. Central
to this is engagement with our stakeholders
and considering in all instances the long-term
implications of decisions made and acting
at all times to maintain the highest possible
standards of conduct.
Further details on key actions in this regard
are also contained within the Directors’
report and the corporate governance
statement on pages 46 to 49.
S172(1) statement
In accordance with the Companies Act 2006
(the Act) (as amended by the Companies
(Miscellaneous Reporting) Regulations 2018),
the directors provide the following statement
describing how they have had regard to the
matters set out in section 172(1) of the Act,
when performing their duty to promote the
success of the Bank under section 172.
In accordance with the Large and Medium-
sized Companies and Groups (Accounts and
Reports) Regulations 2008 (as amended by
the Companies (Miscellaneous Reporting)
Regulations 2018), the following statement
also provides details of how the directors
have engaged with and had regard to the
interests of key stakeholders.
The Bank is a subsidiary of LBG, and as such
adopts many of the processes and practices
of LBG, which are further referred to in this
statement where relevant.
23Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Customers and clients
The Board’s deep understanding of customers’ and clients’
needs is vital in setting and achieving the bank’s goals.
Delighting our clients and customers and
identifying their needs through a more themed
and targeted customer-centric approach
remains therefore a key consideration in Board
decisions. The directors ensure the Bank works
towards achieving its customers’ ambitions,
treating customers fairly, and making it easy
for customers to find, understand and access
products that are suitable for their needs.
The Board is committed to providing
meaningful support to meet the needs
of customers, aiming to provide positive
outcomes and working to mitigate or
reduce the risk of financial harm. The Board
has increased its emphasis on customers
through focused discussions at Board
meetings, refinement of customer goals
in the Bank’s balanced scorecard and
activity to strengthen relationships.
Members of the Board spent time with
customers at events such as the LBCM
Markets Summit in October and International
Monetary Fund meeting. During a strategy
offsite meeting and visits to the Crown
Dependencies and New York, the Board took
the opportunity to understand more about
LBCM’s customer base and how to deepen
those relationships.
To ensure directors truly understand the
needs of customers, customer feedback and
related management information are regularly
considered including as part of the directors’
strategic decision-making process.
The Bank regularly benchmarks its
performance and the performance of
its business units amongst its customers.
The directors use this insight along with a
range of internal and external research to
ensure ongoing improvement in customer
experience. The directors ensure the Bank
plays an active part in LBG’s wider customer
ambitions, as acknowledged in the Bank’s
strategy, and where appropriate during
the course of the year this has included the
ongoing development of market leading digital
propositions, more personalised customer
propositions and better experience for
customers across all channels.
References to customers above also include
corporate clients, where clients are not
specifically mentioned.
The FCA’s Consumer Duty (the Duty) took
effect in July 2023 for current business
in addition to a new FCA Principle for
Business requiring firms ‘to act to deliver
good outcomes for retail customers’. LBCM
continues its commitment to adhere to
LBG policies that were revised in accordance
with the Duty. The Duty took effect for
closed products in July 2024 and LBCM
reviewed its closed products ahead of
this date concluding there were none to
be considered in scope. The LBG Board
consumer duty champion continues to
represent the Bank for compliance with
the Duty.
A customer-centric
approach remains a
key consideration in
Board decisions
Stakeholder engagement continued
24Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Colleagues
The Board considers that maintaining open dialogue is
crucial in informing its thinking, allowing directors to hear
first-hand colleague views on the matters most important
to them as well as the Bank.
Recognising the importance of this period of
transition for LBCM, with ambitious financial
targets and important developments in
strategy and business model, the outgoing
Chair (Lord Lupton), interim Chair (John
Owen) and incoming Chair (Nathan Bostock)
were mindful of the importance of colleague
communication and being visible during
this period of change and uncertainty. This
included finding opportunities for closer
collaboration with colleagues in CIB and
colleagues from across LBG providing shared
services to LBCM. There was also a focus on
meeting colleagues on the succession plan
or identified as talent.
Nathan Bostock also joined the end-of-year call
with all LBCM colleagues to share his reflections
in role to date and respond to questions.
Throughout 2024 the Board received regular
updates on workforce engagement and on
colleague matters through a combination
of direct colleague listening sessions and
updates from the CEO, people director and
business heads. This included the review of
the findings of surveys of colleague sentiment,
including annual and ad hoc surveys, and
review of the progress being made in
addressing the matters colleagues have
previously raised.
Stakeholder engagement continued
Examples of Board engagement with
colleagues included:
• A review of the pulse engagement reports
throughout the year, as well as the annual
colleague engagement survey, including
key themes and issues which colleagues
raised during the year. The Board is
committed to maintaining momentum
in engagement with colleagues.
• The Board recognises the importance
of meeting colleagues in their place
of work and having time for deeper
conversations on matters important
to them and progress against strategic
objectives. During 2024, members of the
Board visited the branches in the Crown
Dependencies and New York to both
share their perspective on matters on
the Board’s agenda and discuss LBCM’s
progress against its strategic objectives.
• Nathan Bostock has spent time with
colleagues across the Bank and LBG to
understand the business and listen to
their concerns. Ahead of joining, Nathan
also attended the Bank’s strategy offsite
in May which gave him the opportunity
to meet the senior leadership team and
spend time with fellow board members.
• The Board has an annual programme of
colleague breakfasts enabling the Chair
and members of the Board to hear directly
from colleagues (without the executive
present) across the business, sharing their
experiences on a range of initiatives and
cultural topics. 1:1 sessions were held with
a number of senior business leaders.
• Colleagues making a significant difference
through delighting the customer or
reducing bureaucracy are recognised
for taking action.
• Board members have participated in other
engagement activities such as attending
leadership events and joining the LBCM
team-wide calls.
25Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
UK colleagues are remunerated by LBG (and
recharged to the Bank), while colleagues
based in the US, Germany and the Crown
Dependencies are remunerated by LBCM.
UK, Isle of Man and US colleagues are eligible
to participate in HMRC/IRAS approved share
plans which promote share ownership by
giving employees an opportunity to invest
in LBG shares. The Bank follows the LBG
remuneration principles that are designed
to specifically promote appropriate culture
and colleague behaviours that meet customer
needs and regulatory expectations, supported
by the structure of the remuneration package
offered to colleagues.
In relation to base pay (salary) for UK and
Crown Dependencies colleagues, the Bank
aims to ensure that the pay is determined and
applied fairly and consistently to all colleagues.
For 2024 and 2025, a two-year pay deal was
agreed, which is 4 per cent each year for junior
colleagues and 3.5 per cent pay budget for
senior colleagues below executive level.
For the 2024 annual pay review, the 4 per cent
and 3.5 per cent pay budgets were applied
consistently to colleagues in the US and
Germany.
The remuneration principles also apply to
the wider package including variable pay to
ensure that reward is performance-driven, with
risk performance appropriately considered,
recognises success in delivering our purpose
and strategy, is talent-focused to attract and
retain high-calibre colleagues and embodies our
values: people-first, inclusive, trust, sustainable
and bold. Further information can be found in
the LBG annual report and accounts for 2024,
available on the LBG website.
The Bank, within the context of LBG, seeks
to maintain a culture where our people
feel supported, included and empowered.
There are a variety of channels available to
support this, such as Let’s Talk (informal
resolution service) as well as Speak Up
(LBG’s whistleblowing programme), which
enables colleagues to report their concerns
confidentially and anonymously.
Andrew McIntyre is the Bank’s whistleblowing
champion and is responsible for oversight of
arrangements. This is achieved through ensuring
that the confidential reporting system remains a
reliable and independent channel for colleagues
to report suspected wrongdoing.
In the ‘people and culture’ section
of this report, updates are provided
on our values, and goals relating to
diversity and inclusion as part of LBG.
Stakeholder engagement continued
26Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
The directors acknowledge that the Bank, as part of one of the
largest financial service providers in the UK, has responsibilities
to invest in the communities in which it operates across the
jurisdictions, to help them prosper economically and build a
more sustainable future.
local charities and initiatives. As Crisis has
no presence in the Crown Dependencies,
the Bank supports charities that share similar
goals such as The Shelter Trust in Jersey,
Action for Children Guernsey Youth Housing,
and Housing Matters in the Isle of Man.
Members of the Board experienced at first
hand the work of The Shelter Trust on its
visit to Jersey in July 2024.
In support of the environment, teams
collaborated with the Isle of Man Woodland
Trust, Manx Wildlife Trust, Group Woodland
Trust and National Trust in Jersey to help plant
trees, remove invasive species, field clearing
for wildflower planting and cleaning beaches.
Colleagues also helped with tree planting at
Bosdet Foundation’s premises near Green
Island and held lunch-and-learn sessions from
renowned environmental speakers.
Colleagues continue to support charities of
all sizes through running the Dublin Marathon,
raffles, cake bake sales, Macmillan Cancer
Support Rowathon and coffee mornings in
branch for colleagues and customers.
Communities and the environment
LBCM colleagues globally
participated in many
charity fundraising and
volunteering activities
throughout 2024
Stakeholder engagement continued
The directors receive regular updates on
responsible and sustainable business activities.
The Bank has aligned with LBG’s sustainability
objectives, including the current net zero by
2050 climate pledge, which is a key part of
the Bank’s sustainability strategy and directly
supports global external goals.
The Bank’s colleagues continue to undertake a
variety of fundraising and volunteering activities,
both via LBG’s charitable relationships and via
their own personal connections with a wide
variety of large and small charities.
In particular, the Bank continues to support
LBG’s charity partner, Crisis, a UK national
charity for people experiencing homelessness.
This included participation in a fundraising
trek to climb Mount Toubkal in Morocco. UK
colleagues also participated in volunteering
with the Woodland Trust and the Group’s
Charity Response Forums.
In North America, the Bank celebrates
one year with new charity partner Breast
Intentions, whose mission is to directly aid
those impacted financially by breast cancer
diagnosis. Colleagues have run marathons
and held bake sales and trivia events to raise
money in support of this organisation.
In the Crown Dependencies the Bank
continues to work with the Lloyds Bank
Foundation for the Channel Islands to support
27Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
As LBCM is a wholly owned subsidiary,
the Board ensures that the strategy,
priorities, processes and practices of LBCM
are aligned where appropriate to those
of LBG, ensuring that its interests as the
Bank’s shareholder are duly acknowledged.
The LBCM Chair Nathan Bostock is also a
director of LBG, which ensures connectivity
and alignment between the Boards. The
Bank’s Corporate Governance Framework
which was refreshed in 2024 sets out the
relationship with LBG and the reporting of
material matters.
The LBCM Board and its committees
provide regular updates to the LBG
Board and its committees on the Bank’s
activities and performance. There is regular
engagement with the LBG CEO, LBG
Chair and CIB CEO on such matters as
the Bank’s strategy in the context of CIB
and LBG. CIB’s CEO attended the Bank’s
strategy day in May and has continued to
work with LBCM’s CEO throughout the
year. This includes co-presenting to the
Board on changes to the operating model
and CIB’s strategy for which LBCM plays a
significant role. LBG’s NEDs are also invited
to attend Board and Committee meetings
during the year at which the Board can
share insights and hear the LBG perspective
increasing shareholder engagement. These
arrangements ensure the Bank’s Board has
a clear understanding of the views of its
shareholder. In addition, the Bank’s Board
attends the joint annual meeting with the
LBG and Insurance Boards, and the Audit
and Risk Forum providing an opportunity to
share further insights of mutual interest.
Further information in respect of the
relationship of LBG with its shareholders is
included in the Strategic Report within the
LBG Annual Report and Accounts for 2024,
available on the LBG website.
The Bank is a wholly owned subsidiary of LBG,
forming part of its Corporate & Institutional
Banking (CIB) business unit.
Scan the QR code to be taken
to the LBG Annual Report and
Accounts
Stakeholder engagement continued
Shareholder
28Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
The Bank’s approach to external supplier
management utilises the LBG framework
and aligns to the standards set out by our
regulators. The supply chain is crucial to the
way the Bank and LBG serves its customers,
and through it the reach is considerable.
Importance is placed on having the right
supplier framework to operate responsibly.
LBG’s Sourcing and Supply Chain
Management Policy applies to all areas and
subsidiaries of LBG, including the Bank, with
the directors assuming ultimate responsibility
for its application as relevant to the Bank. This
policy has been designed to assist in managing
the inherent risk in outsourcing services, and
in dealing with third-party suppliers. Suppliers
are required to adhere to relevant LBG policies
and comply with LBG’s Code of Supplier
Responsibility, which can be found on the
LBG website. This defines expectations for
responsible business behaviour, underpinning
the efforts of the Bank and LBG to share and
extend good practice. All material contracts
are subject to rigorous cost management
The Board recognises the importance of partners who provide
aspects of the Bank’s operations through the shared service
model with LBG and their importance to our customers.
Suppliers
Stakeholder engagement continued
Regulators and
regulatory agenda
The Chair and individual directors have had
discussions with the Prudential Regulation
Authority on a number of aspects of the
regulatory agenda. The Board in turn
reviews regular updates on this and progress
is being made in addressing key regulatory
priorities. Key areas of interest for the Board
have included ensuring robust prudential
standards, operational resilience, trading
controls, the fair treatment of customers
and the response to market changes.
Regular updates to the Board Risk
Committee also cover all aspects of the
regulatory agenda including emerging
regulatory and legal risks. This provides a
focused view of areas of priority alongside
detail of regulators’ actions.
The Board continues to closely monitor the
status of the Bank’s regulatory relationships
across all the jurisdictions in which it has a
presence, seeking to enhance engagement
particularly in key areas of regulatory change.
The Bank and its directors maintain an open and
transparent relationship with relevant regulators and
other authorities and liaise regularly with them both
directly and as part of LBG to ensure the business
complies with its regulatory requirements.
governance with regular review of key supplier
risks which includes increasing focus on
resilience, financial stability and sustainability.
The Bank and LBG also regularly seek feedback
from the Group’s third-party suppliers on
related assurance processes to ensure
continued improvement in processes. Suppliers
are asked to express their satisfaction or
otherwise and have access to LBG and the
Bank’s whistleblowing service. The operation
of the Bank’s supply chain is through LBG. The
Board supports LBG’s zero-tolerance attitude
towards modern slavery in LBG’s supply chain
and an assurance process of the measures
which address the risk of human trafficking
and modern slavery in the wider supply chain
is undertaken by LBG.
29Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Principal risks and uncertainties
This section provides analysis of LBCM’s risks including the
principal and emerging risks which could impact LBCM’s ability
to deliver its long-term strategic objectives. The approach to
managing each risk is reviewed and reported to the Board
Risk Committee regularly, in alignment with the risk
management framework.
Our enterprise risk
management framework
The LBG enterprise risk management
framework (ERMF) applies to all legal entities
and is the foundation for the delivery of
effective and consistent risk control. It
enables proactive identification, active
management and monitoring of LBCM’s
risks, which is supported by our ‘One Risk
and Control Self-Assessment’ approach.
LBCM has adopted the ERMF, supplemented
with additional tailored practices set out
to address LBCM-specific requirements.
The ERMF and the LBCM risk management
framework (RMF) applies to LBCM business
across all legal entities and locations.
LBG is in the process of evolving the ERMF
to improve the clarity and consistency of
risk management across LBG. This is part of
broader risk management transformation.
Some activity has already been completed,
including reclassification of LBCM’s principal
risks and resetting of the non-financial risk
management approach.
LBCM’s risk appetite, principles, policies,
procedures, controls and reporting are
regularly reviewed and updated to ensure they
remain in line with regulation, law, corporate
governance and industry good practice.
Risk appetite is defined within LBCM as the
amount and type of risk that it is prepared
to seek, accept or tolerate in delivering its
strategy. As a separate legal group with its own
Board, LBCM maintains its own risk appetite
which is aligned to the LBG approach but is
adjusted to reflect the specific characteristics
of LBCM’s balance sheet and portfolio,
including its international presence. The LBCM
Board is responsible for annually approving
LBCM’s risk appetite statement. Board-
level risk appetite metrics are supported by
executive-level metrics and cascaded into
more detailed business metrics and limits.
Principal risks
and uncertainties
30Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Regular close monitoring and comprehensive
reporting to management and the Board
ensures risk appetite limits are maintained
and subject to stress analysis at a risk type
and portfolio level, as appropriate.
Principal risks and uncertainties continued
Governance is maintained through delegation
of authority from the Board down to
subsidiary boards and to individuals. Senior
executives are supported by a committee-
based structure which is designed to ensure
open challenge and enable effective Board
engagement and decision-making.
The Board and senior management play
a vital role in shaping and embedding a
supportive risk culture. Senior leaders set a
clear tone from the top and lead by example
reflecting LBG values, encouraging a culture of
intellectual curiosity, innovation and proactive
risk management amongst all colleagues.
Enterprise risk management framework
Role of the Board and
senior management
Risk culture and
the customer
Risk appetite
Risk and control
self-assessment
Risk governance
Three lines of defence
The Board delegates executive authorities to ensure there is effective oversight of risk management. LBCM
operates its own Board separate from LBG.
The appropriate culture ensures performance, risk and reward are aligned. LBCM follows the same approach
as set out in the ERMF.
The framework ensures our risks are managed in line with our risk appetite. LBCM has its own risk appetite
which is approved by the LBCM Board and noted by the LBG Board, but follows the same approach as set
out in the ERMF.
The identification, measurement and control or our risks form an integral part of our One Risk and Control
Self Assessment. LBCM follows the same approach as set out in the ERMF.
The governance framework supports a consistent approach to enterprise-wide behaviour and
decision-making. LBCM has its own risk management committee structure.
The robust approach to monitoring oversight and assurance ensures effective risk
management across LBG. LBCM follows the same approach as set out in the ERMF.
01
02
03
04
05
06
Financial risk management
objectives and policies
Information regarding the financial risk
management objectives and policies of
LBCM, in relation to the use of financial
instruments, is given in notes 12 and 31
to the accounts. LBCM’s approach to
risk management including risk policies,
risk appetite, measurement bases and
sensitivities, in particular for credit risk,
market risk and liquidity risk, is aligned
to those of Lloyds Banking Group plc,
the Bank’s ultimate parent. Further
information can be found in the Lloyds
Banking Group plc annual report.
LBCM maintains risk management
systems and internal controls relating
to the financial reporting processes
designed to:
• Ensure that accounting policies are
appropriately and consistently applied.
• Enable the calculation, preparation and
reporting of financial outcomes in line
with applicable standards.
• Ensure that disclosures are made on
a timely basis in accordance with
statutory and regulatory requirements.
31Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Emerging risk theme Concerns for LBCM and key considerations
Agile & evolving
workforce
Failure to create an agile, high-performing workforce with high quality talent and key skills in LBCM and in shared
service locations that align to the evolving industry needs, to deliver our strategy.
Business resilience Failure to adequately prepare for disruption of service, third- or fourth-party supplier failure, technology outages.
Climate & environmental
commitments
Investor, shareholder and public perception of LBCM’s; i) ability to assess, manage and improve our awareness of the
ecological and environmental impacts ii) ability to offer sustainable financing options products and services and iii)
role in enabling the transition to a low-carbon economy, and improve climate-related disclosures and collaborating
with external stakeholders to address climate challenges.
Client and customer
propositions & market
competition
Failure to adapt our propositions to market demands, the continually evolving expectations and demographic of
consumers, and digital trends whilst staying competitive against our peers.
Data management
evolution
Failure to mitigate emerging technology-originated data risks, manage and protect data.
Global macroeconomic
& political environment
Inability to navigate changing international markets, economic fragmentation, ‘black swan’ events, barriers to trade,
supply-demand imbalances, deglobalisation, and geopolitical events that may impact operations, customers and suppliers.
Regulatory landscape Failure to keep pace with the rapidly evolving regulatory reforms across various jurisdictions, including divergence
between UK, EU and US and evolving expectations on the regulatory bodies and the knock-on impact on
financial services.
Technological advances Failure to i) adopt new technologies, streamline and transform group operations and customer propositions, and ii)
create a competitive advantage through the use and continual investment into technological development directly
or through the LBG shared services.
UK economic
environment
Failure to anticipate the longer-term impacts of a weak UK economy, higher interest rate environment, stubborn
inflation, increased fiscal borrowing, a higher taxation environment and uncertainty around the direction of tariffs,
collectively has associated impacts on investor appeal.
LBCM continues to explore how existing and new emerging risks may impact its future strategy, and how it can continue to best protect its
customers, colleagues and shareholders.
Emerging risks
Principal risks and uncertainties continued
Emerging risks
Emerging risks are a key component of
the LBCM risk framework. LBCM’s horizon
scanning activity enables identification of the
most pertinent internal and external operating
trends. This insight informs LBCM’s strategy,
which in turn impacts LBCM’s risk profile.
As part of its risk framework, LBCM needs
to identify risks and opportunities, and to
respond through strategic planning and
appropriate risk mitigation. Although emerging
risks are not principal risks, if left undetected
emerging risks have the potential to adversely
impact LBCM or result in missed opportunities.
Where an emerging risk is considered material
enough in its own right, LBCM may choose
to recognise the risk as a principal risk. Such
elevations are considered and approved
through the Board as part of the annual refresh
of the enterprise risk management framework.
LBCM’s focus on the emerging risk landscape
and assessment approach has been evolved
to reflect the scale of transformation LBG is
delivering. A review of the key emerging risks
has taken place during the year and on this
page are LBCM’s key emerging risk themes
enabling greater management concentration
on developing the appropriate responses:
32Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Risk description
The risk that LBCM
experiences losses and/or
reputational damage as a
result of climate change,
either directly or through
its customers. LBCM is
aligned with LBG, its parent
company, with the goal of
reducing emissions financing
by more than 50 per cent
by 2030 and achieving net
zero financed emissions
by 2025 (refer LBG 2024
Annual Results and the LBG
sustainability report).
Key mitigating actions
LBG manages climate-related risk in different ways across inbound and
outbound themes identified:
• Commitment to transition to net zero is supported by appropriate
plans and strategies, including how different business areas are
supporting the transition.
• External disclosures are subject to robust governance processes.
• Controls and processes on greenwashing focused on ensuring
communications are fair and not misleading.
• Inbound physical and transition risks and their impacts cut across
other principal risks in different ways and as such considered in
multiple processes and frameworks, e.g. credit risk processes,
operational resilience.
• Regulatory expectations are monitored, including current relevant
requirements, and activity and progress towards these, as well as
horizon scanning for new developments.
Climate risk
Principal risks and uncertainties continued
Other areas of focus in 2024
In addition to the emerging risks mentioned
above, and in line with LBG, LBCM continues
to focus on model risk as the risks associated
with the use of proprietary models have
increased in recent years due to the limitations
of historical data, the recent extreme market
volatility, and the risk of ineffectiveness in
parameterisation, implementation, oversight
and monitoring.
Principal risks
The definitions of risks have been updated
since the disclosure in LBCM’s 2023 annual
report and accounts. There has been a detailed
review of risk categories, and an event-based
risk management framework implemented.
This has resulted in a reduction in the number
of principal risk types and the simplification
of secondary risk categories. This change
better aligns to the Basel Committee on
Banking Supervision’s event categories which
will benefit LBCM for scenario activities and
regulatory reporting.
Risk description
The risk that an insufficient
quantity or quality of capital
is held to meet regulatory
requirements or to support
business strategy, an
inefficient level of capital
is held or that capital is
inefficiently deployed
across LBCM.
Key mitigating actions
• A comprehensive capital management framework that includes setting
of capital risk appetite, capital planning and stress testing activities with
well-established capital policies and procedures are well established and
subject to independent oversight.
• Monitoring of capital and leverage ratios to ensure that LBCM meets
regulatory requirements, remain within Board risk appetite and which
results in efficient deployment of capital resources.
• Maintaining a recovery plan setting out a range of potential mitigating
actions that could be taken in response to a stress, including the capital
contingency framework designed to identify emerging capital concerns
at an early stage.
• Managing the demand for capital through management actions including
adjusting its lending strategy, business disposals and through the
efficient use of securitisations and other optimisation activity.
Capital risk
33Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Risk description
The risk of financial
penalties, regulatory
censure, criminal or civil
enforcement action or
customer detriment as a
result of failure to identify,
assess, correctly interpret,
comply with, or manage
regulatory and/or legal
requirements.
Risk description
The risk of LBCM activities,
behaviours, strategy or
business planning, having
an adverse impact on
outcomes for customers,
undermining the integrity
of the market or distort
competition, which could
lead to regulatory censure,
reputational damage or
financial loss.
Key mitigating actions
• The LBCM Board has an established risk appetite and metrics for
compliance risk.
• Compliance risk management policies and procedures are designed to
ensure appropriate controls and systems are in place to comply with
applicable laws, rules and regulations.
• Framework and processes are in place to monitor ongoing compliance
with new legislation.
• Ongoing investment in people, processes, training and IT is being made
to impact assess and help meet its legal and regulatory commitments.
• Ongoing horizon scanning is undertaken to identify and address changes
in regulatory and legal requirements.
• Engagement with regulatory authorities and industry bodies on
forthcoming regulatory changes, market reviews and investigations
is taking place.
• Mechanisms for the business are in place to identify, assess and monitor
risks, providing appropriate management information, and with robust
oversight and escalation routes.
• Oversight, proactive support and constructive challenge to the business
in identifying and managing regulatory and legal issues is undertaken by
the compliance and legal functions.
• Thematic reviews of regulatory compliance and oversight of regulatory
compliance assessments across businesses and divisions are undertaken
where appropriate.
Key mitigating actions
• Conduct risk appetite and associated metrics to provide a granular view
of how LBCM’s products and services are performing for customers
through the customer lifecycle.
• Conduct policies and procedures are in place to ensure appropriate
controls and systems that deliver fair customer outcomes and support
market integrity and competition requirements.
• Customer needs are considered through customer plans, which have an
integral conduct lens.
• Robust product governance framework to ensure products continue to
offer customers fair value, and consistently meet their needs throughout
their product lifecycle.
• Root cause analysis, complaint management and customer
accountabilities for colleagues, with rewards driven by customer-centric
metrics.
• Ongoing enhancements and embedding of LBCM’s framework to
support customers, in particular those in vulnerable circumstances.
• Continued focus on market conduct; membership to the Fixed Income,
Currencies and Commodities Markets Standard Board; and commitment
to conducting market activities consistent with the principles of the
UK Money Markets Code, the Global Precious Metals Code and the FX
Global Code.
• Adoption of robust change delivery methodology to enable prioritisation
and delivery of initiatives to address conduct challenges.
• Continued focus on proactive identification and mitigation of conduct
risk in LBCM’s strategy.
• Active engagement with regulatory bodies and other stakeholders to
develop understanding of concerns related to customer treatment,
effective competition and market integrity, to ensure that LBCM’s
strategic conduct focus continues to meet evolving stakeholder
expectations.
• Review and oversight of thematic conduct agenda items at senior
committees, ensuring holistic consideration of key conduct risks.
• Robust recruitment and training, with a continued focus on how LBCM
manages colleagues’ performance with clear customer accountabilities.
• Ongoing engagement with third parties involved in serving LBCM’s
customers to ensure consistent delivery.
Compliance Conduct risk
Principal risks and uncertainties continued
34Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Risk description
The risk that parties with
whom LBCM has contracted
fail to meet their financial
obligations (on and off-
balance sheet).
Risk description
Liquidity risk is defined as
the risk that LBCM does
not have sufficient financial
resources to meet its
commitments when they fall
due or can only secure them
at excessive cost.
Key mitigating actions
• Prudent, through-the-cycle credit principles, risk policies and appetite
statements, to manage risk effectively.
• Robust risk assessment and credit sanctioning to ensure appropriate and
responsible lending.
• Extensive and thorough credit processes and controls to ensure effective
and timely risk identification, management and oversight.
• Early identification of signs of stress leading to engagement with
customers.
• Regular and robust independent credit risk assurance.
Key mitigating actions
• Ensuring that LBCM’s liquidity risk management framework is
adequate regarding the internal risk appetite, strategy and regulatory
requirements. Liquidity policies and procedures are subject to
independent internal oversight by the Risk team.
• Holding a liquidity buffer to cover potential cash and collateral net
outflows calibrated to support strategic and operational needs as well
as regulatory requirements and internal risk appetite.
• Undertaking monitoring against a number of market and entity specific
early warning indicators complemented with stress testing analysis.
• Maintaining a contingency funding plan detailing actions and strategies
available in stressed conditions.
• Maintaining diversified funding sources including a Euro Medium Term
Note programme.
Credit risk
Risk description
Economic crime risk
is defined as the risk
that LBCM implements
ineffective policies, systems,
processes and controls to
prevent, detect and respond
to the risk of fraud and/or
financial crime resulting in
increased losses, regulatory
censure/fines and/or
adverse publicity in the
UK or other jurisdictions in
which LBCM operates.
Key mitigating actions
• Application of a risk-based approach to mitigate financial crime and
both internal and external fraud risk.
• Working with financial institutions, industry bodies and law enforcement
agencies to identify and combat fraud and money laundering.
• Policies and frameworks are maintained and designed to provide
customer confidence and protect LBCM as well as designed to detect
and prevent the use of our banking network for money laundering,
bribery, fraud, and activities prohibited by legal and regulatory sanctions.
• Risk appetite metrics assess the effects of fraud, including the financial
loss, the expenses associated with fraud prevention systems and
operations, and the impact on customer experiences related to both
actual and attempted fraud.
Economic crime
Liquidity risk
Risk description
The risk that LBCM’s
capital or earnings profile
is adversely affected by
changes in market rates or
prices, including but not
limited to interest rates,
foreign exchange, equity
prices and credit spreads.
Key mitigating actions
• Setting an appropriate market risk framework and underpinning policies,
relying on a set of limits and triggers calibrated to our risk appetite.
• Undertaking regular monitoring of market risk positions versus limits
and triggers to ensure they remain within limits. Reducing risk in a
cost-effective manner including the externalisation to financial markets
where market liquidity allows.
• Implementing structural hedge programmes to manage liability margins
and the risk of margin compression.
Market risk
Principal risks and uncertainties continued
35Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Risk description
The risk of potential for
adverse consequences
from model errors or
the inappropriate use of
modelled outputs to inform
business decisions. Adverse
consequences could lead
to a deterioration in the
prudential position, non-
compliance with applicable
laws and/or regulations,
or damage to LBCM’s
reputation. Model risk
can also lead to financial
loss, as well as qualitative
limitations such as the
imposition of restrictions
on business activities.
Risk description
Operational risk is defined
as the risk of actual or
potential impact to
LBCM (financial and/or
non-financial) resulting
from inadequate or
failed internal processes,
people, and systems or
from external events.
Resilience is core to the
management of operational
risk within LBCM to ensure
that business processes
(including those that are
outsourced) can withstand
operational risks and can
respond to and meet
customer and stakeholder
needs when continuity of
operations is compromised.
This includes the provision of
services to LBCM (including
people, systems and
processes) outsourced to
Lloyds Bank plc via a shared
service provision model or
by external providers via
Lloyds Bank plc.
Key mitigating actions
• A comprehensive model risk management framework provides the
foundation for managing and mitigating model risk within LBCM.
• Defined roles and responsibilities, including clear ownership and
accountability, independent oversight and approval.
• Principles and controls regarding data integrity, development,
validation, implementation, ongoing maintenance and revalidation,
monitoring, and the process for non-compliance.
• Model monitoring, independent review and periodic validation
and reapproval.
Key mitigating actions
• The risk management framework establishes robust arrangements for
risk governance, through clear definition of individual and collective
accountabilities for risk management, risk oversight and risk assurance
through a three lines of defence model which supports the discharge of
responsibilities to customers, shareholders and regulators.
• Service provision arrangements to assess, monitor and act on risks
arising from the Shared Service Model, governed by an Intra-Group
Agreement (IGA).
• Continued investment in the control environment by both LBCM
and its shared service provider, included third-party providers, with
a focus on moving towards automated preventative and real-time
detective controls.
• Manual and detective controls deployed on an interim basis to prevent
gaps as more strategic automated controls are developed and deployed.
• Deployment of enhanced cyber controls to detect, protect against and
respond to threats to the confidentiality or integrity of information
assets, or the availability of systems, and to ensure effective assurance
of third-party provision.
• Enhancing technology infrastructure and the resilience of systems (including
focus on simplification of IT architecture and the decommissioning of legacy
systems) that support critical business processes.
• Rigorous oversight of relevant management at business area and entity-
level committees.
Model risk Operational risk
Principal risks and uncertainties continued
36Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Strategic report Governance Financial statements Other information
Governance
In this section
Directors Report
Chair’s statement 37
Our Board 39
Board of Directors 41
Our Executive Committee 43
Corporate governance statement 46
Other disclosures 50
The directors present their annual report and audited
consolidated financial statements for the year ended
31 December 2024.
Information included in the strategic report
incorporated in the directors’ report by reference:
• Statement of employee engagement: page 24
• Statement of other stakeholder engagement:
pages 22-28
• Principal risks and uncertainties: pages 29-35
37Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Chair’s statement
Joining LBCM
I joined the LBCM Board in August as Chair and
would like to thank the teams and colleagues
across LBCM for a very warm welcome and the
quality of my induction. I would also like to pay
tribute to my predecessor James Lupton and
interim Chair John Owen and thank them both.
Having spent a 40-year career working in
financial services, it is a very proud moment
for me personally to have joined LBG in a non-
executive role. It’s also a great honour to be
appointed LBCM Chair and lead the Board of
this amazing franchise at a pivotal moment in
its growth plans.
Our purpose-driven strategy
LBCM’s purpose is Helping Britain Prosper by
connecting the UK and Lloyds Banking Group
with the world. We achieve this through
providing a first-class banking, financing and
risk management proposition, underpinned
by excellent customer service. This continues
to position LBCM well for further sustainable
growth in areas of core strategic focus and
deepen relationships across our client and
customer base.
Transforming the business
I am really pleased with the strategic progress
being made and also the increased pace
of delivery from platform investment. This
includes, for example, the multi-year ongoing
investment into our markets trading platform
enabling us to support customers more
consistently, grow the business and improve
efficiency; and in our Crown Dependencies
business the embedding of a new mobile app
which was a major milestone in improving the
customer experience and digitising the business.
Record financial performance
and future opportunities
LBCM is a client-orientated business, and has
seen the benefits of this drive strong financial
performance in the period. Our colleagues
have worked hard to deliver great outcomes
and the record total income in 2024 reflects
real momentum in the business.
Going forward we will continue to build on
the great strengths of the LBCM franchise
as part of LBG’s Corporate & Institutional
Banking division. We will focus on continued
investment in the core systems infrastructure
as we further scale the business on a proven
product set.
2024 has been another year of strong financial
performance and significant growth with continued
investment for the future of the LBCM business.
Nathan Bostock Chair
I am confident
and ambitious for
the future of LBCM’s
global business
38Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Chair’s statement continued
We remain fully focused on supporting
clients, whilst delivering strong strategic
progress and sustainable returns, guided by
our purpose of Helping Britain Prosper
Directors and governance in action
We regularly review the Board’s composition
and diversity and are committed to ensuring
the right balance of skills and experience. As
well as me succeeding Lord Lupton as Chair
during the period, Rose St Louis stepped down
during 2024 and Cecile Hillary will leave the
Board on 28 February 2025. I am grateful
to both for their contribution to LBCM.
Succeeding them, I am pleased to welcome
Richard Shrimpton and Ruth Anderson who
will join the Board in 2025 as internal non-
executive directors.
In this annual report and accounts you will
be able to read about the variety of ways the
Board has engaged with stakeholders across
the jurisdictions in which LBCM operates
in 2024, which is vital in ensuring effective
decision-making.
Conclusion
During 2024 LBCM has continued to deliver
in line with our purpose of Helping Britain
Prosper. I am proud that we have delivered
ambitious growth further strengthening our
track record of consistent performance.
Looking ahead, I am hugely positive about
the future of the LBCM business and that
we will continue to transform at pace, grow
the business, deliver sustainable returns and
support our clients through the opportunities
and challenges of the years to come.
Nathan Bostock
Chair
39Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Our Board
The Board is collectively responsible for promoting and
assessing the long-term, sustainable success of LBCM,
generating value and contributing to wider society. The
Board establishes the purpose, values and strategy and
seeks to ensure that LBCM is Helping Britain Prosper by
connecting the UK and LBG with the world.
The key decisions and matters reserved for the Board’s
approval, such as LBCM’s long-term strategy and
priorities, are set out in the Corporate Governance
Framework, which is reviewed annually by the Board.
The Board is supported by its committees which
make decisions or recommendations on matters as
delegated to them under the Corporate Governance
Framework, including Board appointments, the
effectiveness of internal controls and the risk
management framework, financial reporting,
governance and remuneration policies.
The Board ensures the structure of its meetings
allow for fewer but deeper conversations. These
‘cornerstone conversations’ are allocated material
time on the agenda and anchor the meeting focusing
on what is important for the Bank and its Board.
This enables the Board to spend a greater proportion
of its time on strategic, forward-looking matters.
Good corporate governance underpins LBCM’s ability to support our
clients and customers, and to meet the needs of our stakeholders.
The role of the Board
Our Board and governance structure
Board
Board committees
Company Secretary
Sharon Slattery
Chair
Nathan Bostock
Executive directors
Chief Executive Officer
Carla Antunes da Silva
Chief Financial Officer
Julienne Daglish
Non-executive directors
Mark Basten
Eve Henrikson
Cecile Hillary
Andrew McIntyre
John Owen*
*Senior independent director
Nomination and
Governance Committee
Audit
Committee
Board Risk
Committee
Remuneration
Committee
See page 40
40Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Our Board continued
Board Committees
Nomination and
Governance Committee
Succession planning of the executive
and Board remains a key focus of
the Committee.
Committee purpose and responsibilities
The purpose of the Committee is to keep
the Board’s governance, composition, skills,
experience, knowledge, independence and
succession arrangements under review and
to make appropriate recommendations to
the Board to ensure the Bank’s arrangements
are consistent with the highest corporate
governance standards.
Committee composition, skills,
experience and operation
The Committee comprises three independent
non-executive directors (including LBCM Chair)
and is chaired by Nathan Bostock, whose
biography can be found on page 41.
Board Risk
Committee
Effective risk management is core to
successful delivery of the Bank’s strategy
which is aligned with the strategy of the
wider Lloyds Banking Group.
Committee purpose and responsibilities
The Board Risk Committee is responsible
for assisting the Board in fulfilling its risk
governance and oversight responsibilities. It is
also responsible for providing advice, oversight
and challenge to the Board to embed and
maintain a supportive risk culture throughout
the Bank and Group and supports the Bank’s
agreed risk appetite, policies and procedures
including the appropriateness of LBG policies
for the Bank. The Committee is responsible
for reviewing and reporting its conclusions
to the Board on the Bank’s risk management
framework, which captures all risk policies
and principles. It also provides oversight and
challenge on the quality of services provided by
the Ring-Fenced Bank through the Intra-Group
Agreement (IGA) and where needed, facilitate
escalation to the Board.
Committee composition, skills,
experience and operation
The Committee comprises five independent
non-executive directors (including LBCM
Chair). It is chaired by Mark Basten. See his
biography on page 41.
Audit
Committee
Ensuring oversight of financial
and narrative reporting and the
internal control environment.
Committee purpose and responsibilities
The purpose of the Committee is to monitor
and review the formal arrangements
established by the Board in respect to
the integrity of the financial and narrative
reporting of the Bank and Group, the
independence and effectiveness of the
internal and external audit functions, the
effectiveness of the internal controls and
the risk management framework, and the
adequacy and security of the arrangements
for whistleblowing. This includes the statutory
audit of the consolidated financial statements.
Committee composition, skills,
experience and operation
The Committee comprises four independent
non-executive directors (including LBCM
Chair) and is chaired by Andrew McIntyre.
See his biography on page 41. The Committee
held separate sessions with the audit
teams, without members of the executive
management present.
Remuneration
Committee
Ensuring oversight of the reward package
to ensure it supports the delivery of LBG’s
purpose of Helping Britain Prosper and
encourages effective risk disciplines.
Committee purpose and responsibilities
The Remuneration Committee is responsible
for reviewing and making recommendations
to the Board on the remuneration policy for
LBCM; reviewing performance and approving
remuneration arrangements for LBCM
colleagues under the Committee’s purview;
and for performing other regulator-prescribed
duties for remuneration committees,
taking into account the principles, policies
and governance requirements of LBG and
the recommendations of LBG’s Group
Remuneration Committee. The Committee
also reviews the remuneration opportunities
for colleagues under the Committee’s purview
to ensure they remain reflective of contribution
and aligned to market.
Committee composition, skills,
experience and operation
The Committee comprises three independent
non-executive directors (including LBCM Chair)
and is chaired by John Owen. See his biography
on page 41.
Board Committee members correct as at 31 December 2024.
41Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Board of Directors
Nathan Bostock
Chair
Appointed: August 2024
Nathan was Chief Executive Officer of
Santander UK plc from 2014 until 2022 and
then Head of Investment Platforms at Banco
Santander S.A. until his retirement from
Santander in 2023. Prior to joining Santander
in 2014, Nathan was an executive director
and Group Chief Financial Officer of RBS and
previously held the post of Chief Risk Officer
at RBS. Before joining RBS, Nathan held
various senior positions at Santander UK plc
between 2004 and 2009, including Executive
Director, Finance Director and commercial
Chief Executive Officer roles in Financial
Markets and Corporate Banking and in Cards
and Insurance. He is a chartered accountant.
External appointments:
Non-Executive Director and Chair of the
Audit and Risk Committee of Centrica plc.
John Owen
Senior independent non-executive director
Appointed: September 2017
John has extensive international banking
experience. He worked for the Bank of
America in London and UBS in both the UK
and Switzerland before spending 13 years
in various senior management positions at
Credit Suisse. In 2011, he joined RBS where
he was the Head of EMEA and then CEO
International Banking, responsible for client
coverage teams, the international network,
lending and transaction services products
as well as the provision of Markets products.
Following the retirement of Lord Lupton,
John held the position of LBCM Interim Chair
from 16 May 2024 until the appointment of
Nathan Bostock on 1 August 2024.
External appointments:
None.
Cecile Hillary
Internal non-executive director
Appointed: November 2022
Cecile became LBG’s Group Treasurer in
2021. Prior to that, she had a 24-year career
in investment banking at J.P. Morgan, Morgan
Stanley and Barclays, based in London. During
that time, she worked and ran businesses
across client advisory, securitisation, capital
markets and derivatives.
External appointments:
None.
Andrew McIntyre
Independent non-executive director
Appointed: September 2017
Andrew is a chartered accountant and has
broad boardroom experience with major
public companies. He chaired the board
of Southern Housing Group for nine years
and has served as a non-executive director
at both the Centre for Economic Policy
Research and National Bank of Greece. He
spent most of his executive career at EY.
External appointments:
Audit Committee Chair Cavamont Holdings
Limited; Non-Executive Director and Audit
Committee Chair at Target Group Limited;
member of the Federated Hermes Property
Unit Trust Appointments Committee and
Chair of the Federated Hermes Property
Unit Trust Audit Committee; Non-Executive
Director and member of both the Nomination
Committee and the Audit Committee of Lion
Finance Group plc; Non-Executive Director
and Chair of Audit Committee of EFG Private
Bank Limited and Trustee Treasurer of the
Foundling Museum.
Mark Basten
Independent non-executive director
Appointed: February 2023
Mark is an experienced risk management
professional, with a broad range of
experience across a variety of sectors,
geographies and risk disciplines including
governance forums. He’s led risk management
functions at international banks for more
than 25 years. He was Group Head of Credit
for Nomura Securities and Head of Risk for
Nomura International until 2011, when he
went on to serve as Chief Risk Officer for
ICBC Standard Bank plc until 2020.
External appointments:
None.
AC
BR
NG
NG
BR
A
Re
NG
BR
A
Re
A
Audit Committee member
Board Risk Committee member
NG
Nomination and Governance Committee member
Re
Remuneration Committee member
C
Committee Chair
BR
A
Re
42Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Board of Directors continued
Carla Antunes da Silva
Executive director and
Chief Executive Officer
Appointed: February 2023
Carla was appointed as the CEO for LBCM
in February 2023, having previously served
as internal non-executive director for five
years. From 2015 to January 2023, Carla led
LBG’s strategic work as Group Strategy,
Corporate Development and IR Director in
the Group Executive Committee. She was
responsible for making recommendations on
all areas of major strategic significance for
LBG including M&A and fintech investments,
and managing relationships with the wider
investment community. Prior to that, Carla
spent 18 years as an Equity Analyst covering
European banks, working for Deutsche Bank,
J.P. Morgan and Credit Suisse.
External appointments:
Non-Executive Director and member of
Nomination & Governance Committee of
Novo Banco and Member of the Investment
Committee, St. Edmund Hall, University
of Oxford.
Julienne Daglish
Executive director and
Chief Financial Officer
Appointed: April 2021
Julienne was appointed Chief Financial
Officer LBCM in April 2021. She previously
held the role of Chief Risk Officer for
LBCM. She has more than 25 years of
Financial Markets experience, where she ran
Structured Products within Trading before
taking on the role of Chief Operating Officer
for Financial Markets in LBG. In addition, she
has held customer facing roles in Commercial
Banking and International Private Banking
and spent time in Strategic Development.
External appointments:
Member and Deputy Chair of the Audit Risk
and Compliance Committee for King’s College
London; Co-Optee on Audit, Investment and
Risk Committee for Lloyds Bank Foundation
for England and Wales and Member of the
Global Financial Markets Association (GFMA).
Sharon Slattery
Company Secretary
Appointed: August 2017
Sharon joined Lloyds Banking Group over 25
years ago. She has over 30 years’ experience
in corporate governance and company
secretarial practice. Sharon has held a
variety of roles within LBG as secretary
to boards, board committees and senior
management committees at all levels of the
organisation and currently in addition to her
LBCM role is secretary of LBG’s Responsible
Business Committee. She has broad UK
listed company experience from managing
continuing obligation requirements, annual
reporting and AGM project management
through to share capital and employee share
plan administration. During her career she has
worked on a number of corporate actions.
External appointments:
None.
Eve Henrikson
Independent non-executive director
BR
Appointed: September 2020
Eve has extensive experience in Digital in
a variety of industries and international
markets, spanning Europe, the US and Asia.
She has been leading Digital businesses and
transformation for over 20 years, including
large online operations and P&Ls at Tesco
and Uber, where she managed Europe,
Middle East and Africa for Uber Eats.
With effect from 27 August 2024, she has
been appointed Senior Vice President (SVP)
Trips of Booking.com. In her non-executive
career, she has held roles with Scout Shop
Limited and World Scout Shops Limited
and is currently Non-Executive Director of
Sonae SGPS.
External appointments:
SVP Trips at Booking.com; Non-Executive
Director and Member of the Board and Audit
& Financial and Remuneration Committees
of Sonae SGPS, S.A.
A
Audit Committee member
BR
Board Risk Committee member
NG
Nomination and Governance Committee member
Re
Remuneration Committee member
C
Committee Chair
43Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Our Executive Committee
Delivering our
strategy and
day-to-day
management
Carla Antunes da Silva
Executive director and
Chief Executive Officer
Read her biography on page 42.
Julienne Daglish
Executive director and
Chief Financial Officer
Read her biography on page 42.
Jon Alexander
General Counsel
Jon has over 25 years’ experience working
in private practice law firms and in-house
and he is qualified to practise law in England
and Wales, New South Wales, Australia and
Scotland. As General Counsel for LBCM, Jon
provides advice to the Executive Committee,
Board and wider business on corporate-level
and business-specific issues. He commenced
his role with LBCM in 2020 having joined
LBG in 2004, and he previously held various
leadership roles in the Group’s Consumer,
Business & Commercial and Corporate &
Institutional Banking Legal teams. Jon is
also a Trustee of the Bank of Scotland
Foundation, one of four independent
charitable foundations supported by LBG.
Before joining the Group, he worked in private
practice law firms in Edinburgh and Sydney.
Adele Bohlen
Chief Executive Officer
Crown Dependencies
Adele joined Lloyds Bank International in
2023 as Crown Dependencies Director and
CEO. She is also a Trustee of the Lloyds
Foundation in the Channel Islands.
With over 30 years experience in the
finance industry gained across a number of
client segments and disciplines both on and
offshore, Adele is passionate about ensuring
the client is the focus of everything that we
do and that we build long-term mutually
beneficial relationships.
Prior to joining Lloyds Bank International
Adele worked for Barclays International for
over 7 years, where she was Country Head for
the Isle of Man Business and Global Head of
Fiduciary Business.
The executive directors make
decisions within the parameters
and principles set out in the
Corporate Governance Framework,
which aims to ensure that decisions
are made by management under
the correct authority. There are
executive committees established
to support and advise the Chief
Executive Officer, in particular the
Executive Committee. The other
committees which bring subject
matter expertise and analysis are
the Asset and Liability, Operating,
and Risk Committees.
M A M
C
M
Committee member
A
Committee attendee
C
Committee Chair
44Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Our Executive Committee continued
Anthony Bryson
Managing Director, LBCMW
Anthony joined as CEO of LBCM’s EU
subsidiary in May 2004. Anthony has 30
years of European capital markets expertise
and was Deputy President, Head of EMEA
Capital Markets & Advisory at SMBC Group
in London where he led all private-side
debt, high yield, ECM and M&A teams.
Anthony’s prior positions include Country
Head Germany Austria and Switzerland
at NatwestMarkets and member of BNP
Paribas Executive Board and Head of Debt,
Loan and Acquisition financing for the
German, Austrian and Swiss region based
in Frankfurt. As a British/German national,
Anthony started his career at Deutsche
Bank AG and has extensive client reach
and expertise in continental Europe. He
graduated at the College of Europe, Bruges
and has also published on universal banking
and German corporate governance.
Stephen Ellis
Chief Operating Officer
Stephen is the SMF 24, Chief Operations
Function role holder for LBCM. He is
responsible for supporting and delivering the
LBCM operating model. Stephen has over
20 years’ experience with Lloyds Banking
Group and spent time in leadership roles in
London, Tokyo, Hong Kong and New York,
where he gained a US Broker Dealer Principal
license while serving as Head of Treasury
and Trading North America. Stephen
has sat on the board of two Lloyds Bank
subsidiary companies and is a member of the
Technology & Operations Committee of the
Association for Financial Markets in Europe.
Rob Hale
Managing Director -
Head of Financial Markets
Rob started his career in derivatives trading
in the late 1990s and has worked at a number
of Investment banks before joining Lloyds in
2007 to build out the Rates Trading business
and establish Lloyds as a GEMM (Gilt-Edged
Market Maker). He went on to lead the FX
& Commodities business from 2015, before
becoming Head of Traded Products for
LBCM in 2018. Rob was also the Accountable
Executive for Ring Fencing Delivery,
responsible for the design and delivery of
LBCM Markets in the Commercial Bank.
Since 2021, Rob has been Head of Financial
Markets, responsible for all Financial Markets
activity across London and New York.
Additionally, he is also jointly accountable
for the Markets Platform and delivery of
transformation and technology programmes
for LBCM, which are key to our strategic
ambitions and future growth. Externally, Rob
sits on the Global Foreign Exchange Division
Board and Financial Markets Standard Board
helping to establish global standards for fair
and effective markets.
Nick Hughes
Head of Capital Markets
Nick leads LBCM’s Capital Markets business
globally. The Capital Markets business
provides Corporate and Institutional
clients with comprehensive debt capital
markets, financing and risk management
expertise from locations in the UK, US and
Germany. Products and activities include
primary market bond issuances and US
private placements, liability management
and balance sheet advisory, securitised
products, secondary market credit sales
and trading, and interest rate and inflation
risk management. Nick started his career at
Lloyds in 1999 and has worked in the Markets
business since 2006 in various client facing
and structuring roles serving Corporate and
Institutional clients. In August 2021 Nick was
appointed as head of the Capital Markets
business within LBCM, prior to which he
was responsible for the Derivative Sales
and Structuring business within LBCM.
Bill Mansfield
Chief Executive and Country Head,
North America
William (Bill) Mansfield joined as CEO &
Country Head of Lloyds Bank North America
in May 2024.
Bill has extensive financial markets
experience having most recently been CEO
of MUFG Securities Americas and Regional
Head of Global Markets for MUFG.
Prior to that Bill has worked with a number of
other financial institutions in New York with
a responsibility of servicing Corporate and
Institutional clients.
Bill graduated from the University of Missouri,
Columbia.
MMM M M
M
Committee member
A
Committee attendee
C
Committee Chair
45Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Our Executive Committee continued
Mark Michalski
Chief Internal Auditor
Mark is the Chief Internal Auditor for LBCM,
a position he was appointed to in 2024.
In this role he is responsible for challenging
LBCM executive management to improve
the effectiveness of LBCM governance,
risk management and internal controls,
consistent with the LBCM risk management
framework.
Prior to joining LBG, Mark held several senior
positions where he gained considerable
global experience including the Regional
Head of Investment Banking Audit with UBS,
and several country head Audit roles across
Asia for Bank of America & Merrill Lynch
where he helped improve risk management
and control disciplines across the region.
Mark also worked for Lehman Brothers as the
Asia Head of Equity Derivatives Operations
where he built his extensive knowledge of
financial market products.
Rupert Mingay
Chief Risk Officer
Rupert joined LBCM as a non-executive
director and Chair of the Board Risk
Committee in 2022 before becoming CRO.
He was previously Treasurer of NatWest
Markets and Group Treasurer of Standard
Chartered. Rupert has more than 30 years’
experience in banking, starting his career
with Goldman Sachs and J.P. Morgan.
Fiona Murtagh
People Director
Fiona has spent her career in human
resources, having held a number of generalist
HR roles as well as leading large scale people
change projects, including the successful
integration of Lloyds TSB and Halifax
Bank of Scotland. She spent a number of
years specialising in the areas of talent &
development, supporting the Commercial
Banking business. Following this, she was
appointed as Head of Human Resources for
North America and Global Large Corporates,
covering North America, Asia and Europe.
Fiona’s role subsequently expanded and she
is currently the People Director for LBCM.
Fiona played netball for England for over
13 years, obtained over 100 caps, and was
awarded an MBE for services to netball.
Sharon Slattery
Company Secretary
Read her biography on page 42.
MM AA
M
Committee member
A
Committee attendee
C
Committee Chair
46Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Corporate governance statement
LBCM’s corporate governance statement
Approach to corporate governance
Fundamental to LBCM’s strategy are high
standards of corporate governance.
A Corporate Governance Framework is in place
for the Bank, which sets the approach and
applicable standards in respect of the Bank’s
corporate governance arrangements. This
includes the matters reserved to the Board,
and the matters the Board has chosen to
delegate to management, including decision-
making on operational matters such as those
relating to credit, liquidity and the day-to-
day management of risk, and the governance
requirements of the operation of the Bank
as an entity outside of LBG’s Ring-Fenced
Bank. Governance arrangements, including
the Corporate Governance Framework, are
reviewed to ensure they remain fit for purpose.
In accordance with the Large and Medium-
sized Companies and Group (Accounts and
Reports) Regulations 2008 (as amended by
the Companies (Miscellaneous Reporting)
Regulations 2018) (the Regulations), for the
year ended 31 December 2024, LBCM plc
and its subsidiaries have in their corporate
governance arrangements applied the Wates
Corporate Governance Principles for Large
Private Companies (the Principles) which are
available at www.frc.org.uk. The following
section explains the Bank’s approach to
corporate governance and its application of
the Principles. The Corporate Governance
Framework of the Bank further addresses
the requirements of the Principles as follows.
Principle one –
purpose and leadership
The Board is collectively responsible for the
long-term success of the Bank. It achieves this
by agreeing the Bank’s strategy, within the
wider strategy of LBG, and overseeing delivery
against it. The Bank’s strategy is discussed
further in the strategic report. The Board also
assumes responsibilities for setting the culture,
values and wider standards of the Bank, within
the equivalent standards set by LBG.
Consideration of the needs of all stakeholders
is fundamental to the way the Bank operates,
as is maintaining the highest standards of
business conduct, which along with ensuring
delivery for customers and clients is a vital
part of the corporate culture. The Bank’s
approach is further influenced by the need
to build a culture in which everyone feels
included, empowered and inspired to do
the right thing for customers and clients.
To this end, the Board plays a lead role in
establishing, promoting and monitoring the
Bank’s corporate culture and values, with the
Corporate Governance Framework ensuring
such matters receive the level of prominence
in Board and executive decision-making
which they require. The Board receives regular
updates from the CEO and through People and
Business updates on LBCM’s culture including
progress on the transition to a ‘Grow with
Purpose’ leadership culture, which is closely
aligned to the wider strategy of LBG and
discussed in more detail in the LBG annual
report and accounts for 2024.
Principle two –
Board composition
The composition of the Board supports its legal
and regulatory requirements for independent
decision-making within the overall framework
of LBG policies and controls. Consideration
is given to the need to ensure the Board has
a good balance of skills, mix of knowledge,
experience, and diversity. As at the date of
signing these accounts, the Board structure
is eight directors: a Chair independent upon
appointment, four independent non-executive
directors (‘iNEDs’), one internal NED and
two executive directors. Internal NEDs do
not act as representatives of LBCM’s sole
shareholder, LBG, in their capacity as NEDs
of the Bank’s Board. Led by the Chair, changes
to the Board are overseen by the Nomination
and Governance Committee which continues
to keep under review, on an ongoing basis, the
structure, size and composition of the Board
and its committees, making recommendations
to the LBCM Board as appropriate. Further
changes to the Board composition in 2025
are set out in this report.
The Bank is going through a period of
transition with the first change in Chair since
authorisation following the retirement of Lord
Lupton on 16 May 2024, and its ambitious
financial targets and important developments
in strategy and business model. Lord Lupton
served as inaugural Chair of the LBCM Board
and steered it through the early years as it
developed, grew and matured. John Owen,
Senior Independent Director, and one of the
original iNEDs was well placed to take on
the additional role as Interim Chair until the
appointment of Nathan Bostock, LBCM’s new
Chair and member of the LBG Board, with
effect from 1 August 2024. Nathan brings
extensive capital markets and wider financial
services experience, from his chief executive
and chief risk officer roles, and most recently
as CEO of Santander UK from 2014 to 2022.
47Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
A key focus for Nathan as incoming Chair
is building a Board with the right skills,
diversity and experience for the LBCM’s
next strategic stage.
Following the resignation of Rose St Louis
as internal NED in May 2024, the Board’s
composition reduced from nine to eight
directors and with the announcement that
Cecile Hillary would be leaving LBG, as Group
Treasurer, and resigning from the Bank’s
Board in early 2025, the Chair led the search
for successor internal candidates to serve as
internal NEDs. Richard Shrimpton, Deputy
Treasurer and Treasury Markets Director,
LBG joins the Board from 1 March 2025 to
replace Cecile’s core capital, funding, and
treasury experience and Ruth Anderson,
Chief Operating Officer, LBG COO will
join the Board later in Q1 or early Q2 2025
bringing a wealth of technology, resilience
and transformational experience. The
new appointments will return the Board
composition to nine and will continue the
positive connectivity of having two Group
internal NEDs on the LBCM Board.
As at the date of signing these accounts,
the Board continues to be diverse, with
representation of 50 per cent women and 12
per cent LGBTQ+. The Board has adopted
the LBG Board Diversity Policy, including LBG
Board Diversity Objectives as applicable to
LBCM, and reflecting the relative size of the
Board and that it is a subsidiary, and not a
listed entity. To the extent that the size and
Corporate governance statement continued
structure of the LBCM Board differ from
those of the Group Board, the LBCM Board
aspires to comply on a pro rata basis. The
Board continues to exceed the FTSE Women
Leaders Review recommendation of 40 per
cent board held by women and at least one
woman appointed as chair, senior independent
director, CEO or CFO by the end of 2025.
Following the resignation of Rose St Louis in
May 2024 and the two new appointments in
2025, there is currently no ethnic diversity on
the Board.
Reflecting the size and complexity of
the business, the Board has established
a committee structure comprising a
Board Risk Committee, Audit Committee,
Remuneration Committee and Nomination
and Governance Committee (‘the
Committees’). The Committees make
recommendations to the Board on matters
delegated to them, in particular in relation
to internal control, risk, financial reporting
and remuneration matters. Each committee
has written terms of reference setting out its
delegated responsibilities and comprises iNEDs
with appropriate skills and experience and
chaired by an experienced Chair. Arrangements
are in place to ensure directors not present at
Committee meetings are briefed on the main
items of discussion.
48Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Corporate governance statement continued
Board evaluation
The Board undertakes an annual review of its
effectiveness, which provides an opportunity
to consider ways to identify greater efficiencies,
maximise strengths and highlight areas for
further development.
This year, with the appointment of a new
Chair midway through the year and ongoing
strategy development, the Board decided on
an internal review process, with consideration
for an external review at a future date to cover
the Board’s effectiveness in overseeing these
developments. The internal review process,
conducted by the Company Secretary, with
oversight from the Chair and Nomination
and Governance Committee, included a
confidential short questionnaire to the Board
and its committees, to draw out the key
effectiveness themes. Time was allocated
on the Board and Committee agendas for
discussion with actions identified and tracked.
Alongside this, the Chair undertook
individual assessments of the NEDs, with the
performance evaluation of the Chair carried
out by the NEDs from his appointment on
1 August 2024, led by the senior independent
director, considering the views of the executive
directors. The individual performance
assessment of the CEO was conducted by
the Chair and discussed with the Board. The
individual performance assessments of the
outgoing Chair, Lord Lupton, to the date of
his retirement and of the Interim Chair, John
Owen, for the period to the appointment of
the incoming Chair were conducted during
the year and discussed with the Board. The
evaluation concluded that the performance
of the Board, its Committees, the Chair
and each of the directors continues to
be effective. All directors demonstrated
commitment to their roles and contributed
effectively. The Board is regarded as very
able, with good diversity of expertise and
skills and trusted relationships amongst
the directors, led by the Chair, leading to
open and honest conversations and strong
governance, challenge and debate.
The key findings and areas for consideration
include: (1) ensuring the right amount of
agenda time is spent on strategy/growth
discussions and on the foundational
matters for growing the business safely;
(2) ensuring papers and presentations give
more visibility to LBCM specific data points;
(3) closer collaboration with LBG including
hearing directly from the shared service;
(4) papers and presentations to provide
more focus on clients and customers; (5)
papers to be more expansive and objective
on external influences, with a forward view
of risks and issues; and (6) ensuring the
flow of information between Board and its
committees is efficient. The Board is building
enhancements into its forward agenda
planning to include more time for strategic
forward-looking discussions, customer/
client learnings, and updates from the
shared service. The Chair has set aside time
on the Board agenda to assess progress
against these six key areas of focus.
In response to the findings from the 2023
evaluation, the main focus of improvements
to Board effectiveness in 2024 has been on (1)
further enhancements to sharpen the focus
of Board papers for even greater openness
and transparency: (2) being more creative and
allowing more time for strategic thinking and
growth opportunities; (3) more visibility of
the wider senior management population at
Board; (4) looking for opportunities to further
streamline meetings; and (5) building a sense
of ‘team’ within the Board.
Improvements during the year included: (1)
holistic end-to-end reporting on key business
areas and topics; (2) more time allocated
on Board agendas for focused ‘cornerstone’
conversations on substantive strategic and
supervisory topics; (3) hearing directly from
a wider set of colleagues, including from
colleagues providing services through the
shared service model, both at Board and
through NEDs attending colleague breakfasts,
leadership offsites, floor walks and other
LBCM events. Collaboration with LBG has
continued with LBG directors and senior
management attending LBCM Board meetings
and events; (4) governance simplification
and revised approach to agenda planning to
allow more time for the Board to focus on
strategy and gaining a better understanding of
colleagues, clients and local regulators when
visiting offices across the jurisdictions; and
(5) strengthening Board relationships through
spending time outside the Boardroom, with a
particular focus on welcoming the new Chair
and offering support through in-depth and
tailored discussions. The Board was pleased
with the progress against the actions from the
2023 review.
49Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Principle three –
director responsibilities
The Board has established and maintains
corporate governance practices that provide
clear lines of accountability and responsibility
to support effective decision-making through
the Corporate Governance Framework. This
also helps clarify the relationship between the
Bank and its parent company in order to deliver
long-term sustainable success. Policies are
also in place in relation to potential conflicts
of interest which may arise. All directors
have access to the services of the Company
Secretary, and independent professional advice
is available to the directors at the expense of
LBG, where they judge it necessary to discharge
their duties as directors.
The Board is supported by its Committees
which make recommendations on matters
delegated to them under the Corporate
Governance Framework which was refreshed
in 2024. The management of all committees
is in keeping with the basis on which meetings
of the Board are managed, with open debate
and adequate time for members to consider
proposals which are put forward. The Chair
of the Board and each of its Committees
assumes responsibility with support from the
Company Secretary for the provision to each
meeting of accurate and timely information.
Corporate governance statement continued
Principle four –
opportunity and risk
The Board oversees the development and
implementation of the Bank’s strategy, within
the context of the wider strategy of LBG.
Consideration is given to strategic opportunities,
and the Board’s annual cycle of meetings
includes ‘steering’ agenda items dedicated
to debating the Bank’s strategic priorities
and business updates and key risk areas,
as well as one meeting focused on strategy.
The Board is also responsible for the long-term
sustainable success of the Bank, ensuring it
generates value for its shareholder and delivers
a positive contribution to society.
The Board agrees the Bank’s culture, purpose,
values and strategy within those set by LBG,
and sets expectations for risk management,
financial performance and reporting. The
specific aims and objectives of the Board
are formalised within the Bank’s Corporate
Governance Framework, which also sets out
the key decisions and matters reserved for the
Board’s approval.
Strong risk management is central to the
Bank’s strategy along with a robust risk
control framework which acts as the
foundation for sustainable business growth.
The Board agrees the Bank’s risk appetite,
within the overarching risk appetite of
LBG, and monitors the effectiveness of risk
management with the support of the Board
Risk Committee. Board-level engagement,
coupled with the direct involvement of senior
management ensures that escalated risk issues
are promptly addressed and remediation plans
are initiated where required.
The Bank’s risk appetite, principles, policies,
procedures, controls and reporting are
managed in conjunction with those of LBG
and are regularly reviewed to ensure they
remain in line with regulations, law, corporate
governance, and industry best practice. The
Bank’s principal risks are discussed further in
the strategic report.
Principle five – remuneration
The Remuneration Committee of the Board
is responsible for reviewing and making
recommendations to the Board on the
remuneration policy for the Bank. This
includes reviewing performance and approving
remuneration arrangements ranging from the
remuneration of directors and members of the
executive to that of all other colleagues where
the regulators require the Bank to implement
a specific approach to their remuneration,
such as senior managers and other material
risk takers. When determining awards, the
Committee ensures risk performance has
been appropriately considered as part of
overall performance. The activities of the
Remuneration Committee extend to matters
of remuneration relevant to subsidiaries of
LBCM, taking into account the principles,
policies and governance requirements of
LBG and the recommendations of LBG’s
Group Remuneration Committee.
Principle six – stakeholders
The Bank, as part of LBG, operates under
LBG’s wider responsible business approach,
which acknowledges that the Bank has a
responsibility to help address the economic,
social and environmental challenges
which the UK faces, and as part of this
understand the needs of the Bank’s external
stakeholders, including in the development
and implementation of strategy. Central to
this is LBG’s purpose Helping Britain Prosper
by connecting the UK and LBG with the world
by building a more inclusive, sustainable future
for all: driving long-term, profitable growth by
shaping finance as a force for good.
The workforce, as a key stakeholder,
includes the Bank’s permanent employees,
contingent workers and third-party suppliers
delivering services to customers and clients,
and supporting key business operations.
This also includes LBG colleagues providing
services to the Bank under the shared service
model. The Board’s approach to workforce
engagement includes an annual programme of
engagement activity and oversight of policies
on remuneration structures and practices
that take account of the broader operating
context, including the pay and conditions of
the wider workforce and the Bank’s response
to matters such as any gender pay gap.
50Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Appointment and retirement of directors
The appointment of directors is governed by the Bank’s articles of association and the
Companies Act 2006. The Bank’s articles of association may only be amended by a special
resolution of the shareholder in a general meeting.
Directors
The names of the current directors are shown in this report on pages 41 to 42. Changes to the
composition of the Board since 1 January 2024 up to the date of this report are shown in the
table below.
Joined the Board Left the Board
Lord (James Roger Crompton) Lupton 16 May 2024
Rose M St Louis 17 May 2024
Nathan M Bostock 1 August 2024
Other disclosures
Directors’ indemnities and directors’ and officers’ liability insurance
The directors of the Bank, including the former directors who resigned during the year, have entered
into individual deeds of indemnity with LBG which constitute ‘qualifying third-party indemnity
provisions’ for the purposes of the Companies Act 2006. The deeds were in force during the
whole of the financial year or from the date of appointment in respect of the directors who
joined the Board during 2024. Directors no longer in office but who served on the Board
at any time in the financial year had the benefit of this deed of indemnity during that period
of service. The indemnity remains in force for the duration of a director’s period of office.
The deeds indemnify the directors to the maximum extent permitted by law. In addition,
LBG has appropriate directors and officers liability insurance cover which was in place
throughout the financial year. Deeds for existing directors are available for inspection
at the Bank’s registered office.
LBG has also granted deeds of indemnity by deed poll and by way of entering into individual
deeds, which constitute ‘qualifying third-party indemnity provisions’ to the directors of LBG’s
subsidiary companies, including former directors who retired during the year, and to colleagues
subject to the provisions of the Senior Managers and Certification Regime. Such deeds were in
force during the financial year ended 31 December 2024 and remain in force as at the date of
this report. Qualifying pension scheme indemnities were granted to the Trustees of the Lloyds
Banking Group’s Pension Scheme relevant to the Bank, which were in force during the financial
year ended 31 December 2024 and remain in force as at the date of this report.
Change of control
The Bank is not party to any significant agreements which take effect, alter or terminate upon
a change of control of the Bank following a takeover bid. There are no agreements between the
Bank and its directors or employees providing compensation for loss of office or employment
that occurs because of a takeover bid.
Directors’ interests
The directors do not have any direct interest in the shares of the Bank. Lord Lupton, who retired
during the year, was also a director of LBG and his interest in shares of LBG is shown in the report
and accounts of that company. Nathan Bostock is also a director of LBG and his interest in
shares of LBG are shown in the report and accounts of that company.
Other disclosures
relating to directors
51Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Monitoring time commitments
Non-executive directors are advised of time commitments for the Board and relevant
committees prior to their appointment and are required to devote such time as is necessary to
discharge their duties effectively. The time commitments of the directors are considered by the
Board on appointment and annually thereafter by the Nomination and Governance Committee
and, following the most recent review, the Nomination and Governance Committee is satisfied
there are no directors whose time commitments are considered to be a matter for concern.
External appointments, which may affect existing time commitments to the Board and
its committees, must be agreed with the Chair and prior Board approval must be obtained.
The executive directors do not have any significant external appointments.
Conflicts of interest
The Board has a comprehensive procedure for reviewing, and as permitted by the Companies
Act 2006 and the Bank’s articles of association, approving actual and potential conflicts of
interest. Directors have a continuing duty to notify the Chair and Company Secretary as soon
as they become aware of actual or potential conflict situations. Changes to the commitments
of all directors are reported to the Board via Nomination and Governance Committee and
a register of potential conflicts and time commitments (the Register) is regularly reviewed
and authorised by that committee on behalf of the Board to ensure the authorisation status
remains appropriate.
Other disclosures continued
52Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Results
The consolidated income statement on page
64 in this annual report and accounts shows a
statutory profit before tax for the year ended
31 December 2023: £427 million).
Dividends
The Bank paid a dividend of £450 million in
March 2024 (2023: nil). The directors have
not recommended a final dividend for the
year ended 31 December 2024.
Share capital
Information about share capital is shown
in note 23 on page 109. This information is
incorporated into this report by reference.
The Bank did not repurchase any of its own
shares during the year and there are no
restrictions on the transfer of shares in the
Bank other than set out in the articles of
association and certain restrictions which
may from time to time be imposed by law
and regulations.
Post balance sheet events
Details of events after the balance sheet
date are set out in note 34 on page 126.
Going concern
The going concern of the Bank and LBCM
Group is dependent on successfully funding
their respective balance sheets and
maintaining adequate levels of capital.
In order to satisfy themselves that the Bank
and LBCM Group have adequate resources to
continue to operate for the foreseeable future,
the directors have reviewed the Bank and
LBCM Group’s operating plan and its funding
and capital positions, including a consideration
of the implications of climate change. The
directors have also taken into account the
impact of further stress scenarios. Accordingly,
the directors conclude that the Bank and LBCM
Group have adequate resources to continue in
operational existence for a period of at least
12 months from the date of the approval of
the financial statements and therefore it is
appropriate to continue to adopt the going
concern basis in preparing the accounts.
Branches, future developments
and financial risk management
objectives and policies
LBCM provides a wide range of banking
and financial services through branches
and offices in the UK, US, Germany, and
the Crown Dependencies where the Bank
has four branches.
Other disclosures continued
Information regarding future developments
and financial risk management objectives
and policies of LBCM in relation to the use of
financial instruments that would otherwise
be required to be disclosed in the directors’
report, and which is incorporated into this
report by reference, can be found in the
strategic report.
Information required under DTR 7.2
Certain information is incorporated into
this report by reference. Information about
internal control and risk management systems
relating to the financial reporting process can
be found on page 30.
Information about share capital is shown in
the notes to these accounts. The Bank is a
wholly owned subsidiary of LBG, which holds
all of the Bank’s issued ordinary share capital.
The directors manage the business of the Bank
under the powers set out in the Companies Act
2006 and the Bank’s articles of association.
These powers include those in relation to the
issue or buy back of the Bank’s shares.
Research and development
activities
During the ordinary course of business,
LBCM develops new products and services
within its businesses.
Employees
LBCM employed an average of 826 colleagues
(note 7) during 2024 (2023: 837) reflecting
colleagues based in the US, Germany and
Crown Dependencies. Information concerning
the employees of LBG is available in the LBG’s
2024 annual report and accounts.
Supporting disability
As part of LBG, the Bank aims to be a leader in
disability inclusion and to create an inclusive
and accessible working environment in which
all colleagues feel psychologically and physically
safe, have access to equal opportunities and
where everyone is supported to reach their full
potential. LBG continues to hold the Business
Disability Forum Gold Standard accreditation
and Leading Disability Confident status from
the Department for Work and Pensions. LBG
offers bespoke training, career development
and adjustments for colleagues and applicants
with disabilities, including those who became
disabled while employed. LBCM leverages the
activities within LBG whenever possible. For
more details on this refer to the LBG annual
report and accounts. During 2024 there
has been continued focus on increasing the
awareness and understanding of visible and
non-visible disabilities, with bespoke content
delivered to all colleagues, including a spotlight
on the support available.
Other statutory and
regulatory reporting
53Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Sustainability
Refer to the strategy section within the
strategic report (pages 9-14) for details of
LBCM’s sustainability progress. Additionally,
refer to LBG’s sustainability report which
covers LBG’s progress against the Task Force
on Climate-related Financial Disclosures
(TCFD) recommendations and recommended
disclosures, along with the approach to
addressing the broader purpose pillars across
environmental, social and governance areas.
Alongside TCFD disclosures, the report
includes LBG’s transition plans by system,
which is informed by emerging guidance.
LBCM has taken advantage of the exemption
from the Companies (Strategic Report)
(Climate related Financial Disclosure)
Regulations 2022 reporting requirements in
respect of its own Strategic Report, as the
required disclosures are included in the 2024
annual report and accounts of its ultimate
parent company, Lloyds Banking Group plc,
available at www.lloydsbankinggroup. com/
investors/financial-downloads.html.
Streamlined energy
and carbon reporting
The Bank has taken advantage of the exemption
from Streamlined Energy and Carbon Reporting
(SECR) reporting requirements in its own
directors’ report as it is covered by the LBG
SECR report in the Lloyds Banking Group plc
2024 annual report and accounts available at
www.lloydsbankinggroup.com/investors/
financial-downloads.html.
Significant contracts
LBCM has a shared service contract with
Lloyds Bank plc for the provision of services
(note 7). Details of related party transactions
are set out in note 29.
Statement of directors’
responsibilities
The directors are responsible for preparing the
annual report and the financial statements in
accordance with applicable law and regulations.
Company law requires the directors to prepare
financial statements for each financial year.
Under that law, the directors are required to
prepare the Bank’s and the Group’s financial
statements in accordance with international
accounting standards in conformity with the
requirements of the Companies Act 2006.
Under company law, the directors must not
approve the financial statements unless they
are satisfied that they give a true and fair view
of the state of affairs of the Bank and the
Group and of the profit or loss of the Bank
and the Group for that period. In preparing
these financial statements, the directors
are required to properly select and apply
accounting policies; present information,
including accounting policies in a manner
that provides relevant, reliable, comparable
and understandable information; provide
additional disclosures when compliance with
the specific requirements in international
accounting standards in conformity with the
requirements of the Companies Act 2006 are
insufficient to enable users to understand
Other disclosures continued
the impact of particular transactions, other
events and conditions on the entity’s financial
position and financial performance; and make
an assessment of the Bank’s ability to continue
as a going concern.
The directors are responsible for keeping
adequate accounting records that are
sufficient to show and explain the Bank’s
transactions and disclose with reasonable
accuracy at any time the financial position of
the Bank and the Group and enable them to
ensure that the financial statements comply
with the Companies Act 2006. They are also
responsible for safeguarding the assets of
the Bank and the Group and hence for taking
reasonable steps for the prevention and
detection of fraud and other irregularities.
A copy of the financial statements is placed on
the website www.lloydsbankinggroup.com/
investors/financial-downloads.html. The
directors are responsible for the maintenance
and integrity of all information relating to the
Bank on that website. Legislation in the UK
governing the preparation and dissemination
of financial statements may differ from
legislation in other jurisdictions.
54Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Financial statements Other information
Each of the current directors who are in office
as at the date of this report, and whose names
and functions are listed in the directors’ report
on pages 41 to 42, confirms that, to the best of
his or her knowledge:
• The Bank’s and the Group’s financial
statements, which have been prepared
in accordance with international
accounting standards in conformity with
the requirements of the Companies Act
2006 give a true and fair view of the assets,
liabilities, financial position and profit or loss
of the Bank and the Group.
• The strategic report, and the directors’
report, includes a fair review of the
development and performance of the
business and the position of the Bank and
the Group together with a description of the
principal risks and uncertainties they face.
• The annual report and accounts, taken
as a whole, are fair, balanced, and
understandable and provide the information
necessary for shareholders to assess
the Bank’s and the Group’s position,
performance, business model and strategy.
The directors have also separately reviewed
and approved the strategic report.
Independent auditors and
audit information
Each person who is a director at the date of
approval of this report confirms that, so far
as the director is aware, there is no relevant
audit information of which the Bank’s auditor
is unaware and each director has taken all the
steps that he or she ought to have taken as
a director to make himself or herself aware
of any relevant audit information and to
establish that the Bank’s auditor is aware of
that information. This confirmation is given
and should be interpreted in accordance with
the provisions of the Companies Act 2006.
Deloitte LLP were re-appointed as external
auditors at the annual general meeting
on 7 May 2024 and will hold office until
conclusion of the next general meeting
at which accounts are laid before the Bank.
Financial statements
The financial statements were approved by
the Board and signed on its behalf by
Julienne Daglish
Director
26 February 2025
Lloyds Bank Corporate Markets plc
Registered in England and Wales
Company number 10399850
Other disclosures continued
55Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Financial
statements
In this section
Independent auditor’s report 56
Consolidated income statement 64
Statements of comprehensive income 64
Balance sheets 65
Statements of changes in equity 66
Cash flow statements 68
Notes to the consolidated financial statements 69
56Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Independent auditor’s report to the members of Lloyds Bank Corporate Markets plc
Report on the audit of the financial statements
1. Opinion
In our opinion:
• the financial statements of Lloyds Bank Corporate Markets plc (the “Bank”) and its subsidiaries (the “Group” or
“LBCM”) give a true and fair view of the state of the Group’s and of the Bank’s affairs as at 31 December 2024 and
of the Group’s profit for the year then ended;
• the Group financial statements have been properly prepared in accordance with United Kingdom adopted
international accounting standards and IFRSs Accounting Standards as issued by the International Accounting
Standards Board (“IASB”);
• the Bank financial statements have been properly prepared in accordance with United Kingdom adopted
international accounting standards and as applied in accordance with the provisions of the Companies Act 2006;
and
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements which comprise the:
• consolidated income statement;
• consolidated and Bank statements of comprehensive income;
• consolidated and Bank balance sheets;
• consolidated and Bank statements of changes in equity;
• consolidated and Bank cash flow statements; and
• notes 1 to 35 to the financial statements, which include the accounting principles and policies.
The financial reporting framework that has been applied in the preparation of the Group financial statements is
applicable law, United Kingdom adopted international accounting standards, and as regards the Bank’s financial
statements, as applied in accordance with the provisions of the Companies Act 2006.
2. Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial
statements section of our report.
We are independent of the Group and the Bank in accordance with the ethical requirements that are relevant to our
audit of the financial statements in the UK, including the Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard as
applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. The non-audit services provided to the Group and Bank for the year are disclosed in note 8 to the financial
statements.
We confirm that we have not provided any non-audit services prohibited by the FRC’s Ethical Standard to the Group or
the Bank.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
3. Summary of our audit approach
Key audit
matters
The key audit matters that we identified in the current year were:
i. expected credit losses (Group and Bank);
ii. valuation of complex and illiquid financial instruments held at fair value (Group and Bank);
iii. IT systems that impact financial reporting (Group and Bank); and
iv. credit valuation adjustment (CVA) (Group and Bank)
Our risk assessment for these areas remains consistent with the prior year, with the exception of
credit valuation adjustment, which has been newly identified as a key audit matter for the current
period.
Materiality
Overall materiality used for the Group consolidated financial statements was £38.2 million, which
was determined on the basis of net assets.
Overall materiality used for the Bank financial statements was £38.2 million, which was determined
on the basis of net assets and capped at Group materiality.
Scoping
Our audit scope covers 99 per cent of the Group’s revenue, 94 per cent of the Group’s profit before
tax, 99 per cent of the Group’s total assets and 99 per cent of the Group’s total liabilities.
Our audit approach
Our audit approach is risk focused and structured to reflect the Group’s organisation. It can be summarised into the
following key activities that we used to obtain sufficient audit evidence required to form our opinion on the Group and
Bank financial statements:
• Audit planning and risk assessment
Our audit planning procedures considered the impact of internal and external factors affecting the Group’s profitability
and operations, key audit matters most relevant to the users of the financial statements, the appropriate scope of audit
work performed as well as the expectations and requirements of the Group’s investors and regulators.
In performing our audit risk assessments, we considered the impact of macroeconomic factors on the Group’s key
accounting judgements and sources of estimation uncertainty. The key factors considered in our risk assessments were:
i. the impact of uncertainty in the current economic climate and ongoing geopolitical tensions on the Group’s
expected credit loss provision, credit valuation adjustments, and valuation of certain illiquid and complex financial
instruments; and
ii. changes to the regulatory and litigation environment affecting the Group’s financial reporting.
We obtained the knowledge and information required to inform our audit planning and risk assessment decision making
through regular meetings with Group Finance and the extensive use of data and technology.
Independent auditor’s report
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
2
57Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
• Audit work executed at component level
We have identified components based on the Group’s operating segments. We identified three components: the UK
Banking component, the US, and the Crown Dependencies. The Group audit team was in active dialogue throughout the
audit with the component audit teams responsible for the audit work under the direction and supervision of the Group
audit team. This included determining whether the work was planned and performed in accordance with the overall
Group audit strategy and our instructions to the component auditors. We were able to satisfy ourselves that our oversight
and supervision was appropriate through in-person meetings, video-conferencing, direct onsite reviews of work
completed, and we have continued to attend the quarterly meetings that our components have held with local
management.
The component performance materiality allocated across the three components ranged between £13.4 million and £24.1
million (2023: £11.6 million and £12.8 million).
• Audit procedures undertaken at both Group level and Bank level
We also performed audit procedures over the Group and Bank financial statements, including the consolidation of the
Group’s results, and the preparation of the financial statements, as well as the Group’s entity level and oversight controls
relevant to financial reporting. Entities not covered by our audit scope are subject to analytical procedures to confirm our
conclusion that there were no significant risks of material misstatement in the aggregated financial information.
• Internal controls testing approach
Our internal controls testing approach was informed by our scoping and risk assessment activities. We have assessed the
Group’s end-to-end financial reporting processes supporting all in-scope financial statement balances and identified
relevant controls to test for these balances. This included the testing of general IT controls, process level controls and
entity level controls at the Group level.
• The impact of climate change on our audit
In planning our audit, we have considered the impact of climate change on the Group’s operations and any subsequent
impact on its financial statements. The Group sets out its assessment of the potential impact in note 3 of the Annual
Report.
In conjunction with our climate risk specialists, we have held discussions with the Group to understand their:
• process for identifying affected operations, including the governance and controls over this process, and the
subsequent effect on the financial reporting for the Group; and
• long-term strategy to respond to climate change risks and how this is factored into the Group’s forecasts.
Our audit work has involved:
• evaluating climate risk as a factor in risk assessment for potentially affected balances;
• challenging the completeness of the physical and transition risks identified and considered in the Group’s climate
risk assessment and the conclusion that there continues to be no material impact of climate change risk on financial
reporting;
• reviewing the Group’s qualitative portfolio analysis, and challenging the key assumptions used by the Group with
reference to our own understanding of the portfolios and publicly available documentation; and
• assessing disclosures in the annual report, and challenging the consistency between the financial statements and the
remainder of the annual report.
We have not been engaged to provide assurance over the accuracy of climate change disclosures. As part of our audit
procedures, we are required to read and consider these disclosures to consider whether they are materially inconsistent
with the financial statements or knowledge obtained in the audit and we did not identify any material inconsistencies as
a result of these procedures.
4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate.
Our evaluation of the directors’ assessment of the Group’s and the Bank’s ability to continue to adopt the going concern
basis of accounting included:
• using our knowledge of the Group and Bank, the financial services industry, the financial services regulatory
environment and the general economic environment including, macroeconomic pressures affecting the Group’s
operations, to identify inherent risks in the business model and how such risks might affect the financial resources or
ability to continue operations over the going concern period;
• making enquiries of Group management about the assumptions, including climate risk considerations, used in their
going concern models, and assessing the reasonableness of those assumptions and historical forecasting accuracy;
• with the help of Prudential Regulation specialists, evaluating the Group’s strategic plans in light of the changing
macroeconomic environment, short and longer term financial budgets, funding, liquidity and capital adequacy plans
including internal stress tests;
• considering the Group’s and the Bank’s operational resilience;
• reading industry data, Bank of England reports and other external information to determine if it provided
corroborative or contradictory evidence in relation to the Group’s and the Bank’s assumptions;
• reviewing correspondence and meeting with prudential and conduct regulators to assess whether there are any
matters that may impact the going concern assessment;
• testing the underlying data generated to prepare the forecast scenarios and determining whether there was
adequate support for the assumptions underlying the forecasts; and
• evaluating the Group’s disclosures on going concern against the requirements of IAS 1 – Presentation of Financial
Statements.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on the Group's and Bank’s ability to continue as a going
concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant
sections of this report.
5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the
overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
3
58Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Expected credit losses (Group and Bank)
Key audit matter description How the scope of our audit responded to the key audit
matter
Refer to notes 2, 3, 9, 16 and 31 in the financial statements
The Group has recognised £12 million of expected credit
losses (“ECL”) as at 31 December 2024. The valuation and
allocation of ECL consists of a number of assumptions that
are inherently uncertain and require a high degree of
complex and subjective auditor judgement, specialised
skills and knowledge, and complex impairment modelling.
This is heightened further by the increasing economic
uncertainty resulting from geopolitical risks and recent
changes in government policy in the United Kingdom
(“UK”) and the United States of America (“US”), especially
in the development of the base case economic scenario
and alternate scenarios. As a consequence, we have
determined ECL as a key audit matter.
The key areas we identified as having the most significant
level of management judgement were in respect of:
• Multiple economic scenarios (“MES”);
• Collectively assessed loans; and
• In-model adjustments (“IMAs”), and post-model
adjustments (“PMA”)
Key audit matter description How the scope of our audit responded to the key audit
matter
Multiple economic scenarios
The Group’s economics team develops the future
economic scenarios by developing a base case forecast
based on a set of conditioning assumptions, with the three
outer economic scenarios (upside, downside and severe
downside) derived using a Monte Carlo simulation around
the base case. The modelled severe downside scenario is
then adjusted to capture supply-side risks not
contemplated by the Monte Carlo model. The upside, the
base case and the downside scenarios are weighted at a
30% probability and the severe downside at a 10%
probability. The development of the base case scenario,
including the conditioning assumptions, is inherently highly
complex and requires significant judgement.
We performed the following procedures:
• Tested the controls over the generation of the multiple
economic scenarios including those over the Group’s
governance processes to determine the base case,
alternate scenarios and the weightings applied to each
scenario;
• Working with our internal economic specialists:
– challenged and evaluated economic forecasts in the
base scenario such as the UK and US unemployment
rate, UK commercial real estate price growth,
inflation and forecasted interest rates in the UK and
US regions, and Gross Domestic Product in the UK
and in the US through comparison to independent
economic outlooks, external analysts and market
data;
– challenged and evaluated the appropriateness of
changes in assumptions and/or the model including
changes to the non-modelled severe downside
approach
– challenged and evaluated the appropriateness of the
methodology applied to generate alternative
macroeconomic scenarios, including associated
weightings and assumptions within the model; and
– independently replicated the multiple economic
scenario model for certain variables and compared
the outputs of our independent model to the Group’s
output to re-test scenario generation.
• tested the completeness and accuracy of a sample of
the significant data elements used by the model;
• performed a stand-back assessment of the
appropriateness of the weightings applied to each of
the scenarios based on publicly available data; and
• evaluated the appropriateness of disclosures in respect
of significant judgements and sources of estimation
uncertainty, including macroeconomic scenarios.
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
4
59Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Key audit matter description How the scope of our audit responded to the key audit
matter
Collectively assessed ECL
ECL is determined on a collective basis using impairment
models, except for large impaired cases that are
individually assessed.
These models use a number of significant judgements to
calculate a probability weighted estimate by applying a
probability of default, exposure at default and a loss given
default, taking account of collateral held or other loss
mitigants, discounted using the effective interest rate.
The key judgements and estimates in determining the ECL
include:
• modelling approach, modelling simplifications and
judgements, and selection of modelling data;
• credit risk ratings which are performed on a
counterparty basis for larger exposures by a credit
officer; and
• the appropriate allocation of assets into the correct
staging taking into account any significant
deterioration in credit risk since inception of the loan.
We tested the controls across the process to determine the
ECL provisions including:
• model governance including model validation and
monitoring;
• model assumptions;
• the allocation of assets into stages, including those to
determine the credit risk rating; and
• completeness and accuracy of the significant data
inputs.
Working with our credit modelling specialists, our audit
procedures over the key areas of estimation covered the
following:
• model estimations, where we:
– evaluated the appropriateness of the modelling
approach and assumptions used;
– independently replicated a sample of the models and
compared the outputs of our independent models to
the Group’s outputs;
– assessed model performance by evaluating variations
between observed data and model predictions;
– developed an understanding and assessed model
limitations and remedial actions’ and
– tested the completeness and accuracy of the data
used in model execution and calibration.
• allocation of assets into stages, where we:
– evaluated the appropriateness of quantitative and
qualitative criteria used for IFRS 9 staging, including
assessing the credit rating for a sample of
counterparties;
– tested the appropriateness of the stage allocation for
a sample of exposures; and
– tested a sample of significant data elements used by
models in assigning IFRS 9 stages.
Key audit matter description How the scope of our audit responded to the key audit
matter
In-model adjustments (‘IMAs’) and post-model
adjustments (‘PMA’)
Adjustments are made to models to address known model
and data limitations, and emerging or non-modelled risks.
The current economic environment, characterised by
elevated interest rate environment, has increased the
uncertainty of credit losses. As a result, the amount and
timing of adjustments recognised in the model to account
for the impacts of the current economic environment are
highly judgemental and inherently uncertain.
These adjustments require specialist auditor judgement
when evaluating the:
• completeness of adjustments; and
• methodology, models and inputs used in determining
the relevant adjustments.
Where impairment models do not incorporate all factors
relevant to estimating the ECL, adjustments are made to
address known model limitations and data limitations,
emerging or non-modelled risks and the impact of
economic uncertainty on different industry sectors. The
measurement of judgements around model adjustments to
evaluate the completeness of adjustments, methodology
and model inputs for these adjustments is highly
judgmental and inherently uncertain.
We tested the controls over the valuatuon of in-model and
post-model adjustments.
We performed the following audit procedures over a
sample of model adjustments:
• evaluated the methodology, approach and assumptions
in developing the adjustments;
• tested the completeness and accuracy of significant
data elements in formulating the judgements;
• performed a recalculation of adjustments; and
• evaluated the completeness of adjustments based on
our understanding of both model and data limitations.
Key observations communicated to the Audit Committee
We are satisfied that the ECL provisions are reasonable and recognised in accordance with the requirements of IFRS 9 –
Financial Instruments. The calculations are based on appropriate methodologies using reasonable modelled
assumptions, including IMAs and PMAs addressing model shortcomings. Overall, we are comfortable with the Group’s
conclusions in respect of ECL.
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
5
60Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Valuation of certain complex and illiquid financial instruments held at fair value (Group and the Bank)
Key audit matter description How the scope of our audit responded to the key audit
matter
Refer to notes 2, 3, 12 and 31 in the financial statements
Financial instruments are classified as Level 1, 2 or 3 in
accordance with IFRS 13 Fair Value Measurement.
The fair value of complex and illiquid financial instruments
involves significant judgement. The extent of judgment
applied by the Group in valuing the Group’s financial
investments varies with the nature of assets held, the
markets in which they are traded, and the valuation
methodology applied.
As at 31 December 2024, the Group has £1,188 million of
complex and illiquid financial instruments, consisting of
long-dated derivative contracts, illiquid debt securities and
loans to customers. The valuation of these Level 3
financial instruments uses complex valuation models as
these are without readily determinable market values and
were valued using significant unobservable inputs that
involved considerable judgment by management.
We consider these judgements to be at risk of
management bias, giving rise to a potential risk of fraud.
We tested the controls over the valuation of financial
instruments, including controls over independent price
verification process and model validation controls.
With the help of our valuation specialists, we performed
the following procedures on Level 3 financial instruments:
• evaluated the appropriateness of fair valuation
methodologies used for Level 3 financial instruments;
• calculated an independent valuation for a sample of
modelled Level 3 financial instruments and compared
results of our independent estimates with the valuation
recognised by the Group;
• evaluated the consistency and appropriateness of
inputs and assumptions over time, challenging both
significant movements and non-movements where we
expected change;
• performed a stand back assessment of the
appropriateness of the assumptions, and input data
used in the valuation of Level 3 financial instruments;
and
• assessed the appropriateness of financial instruments
disclosures.
Key observation communicated to the Audit Committee
We are satisfied that the valuation of complex and illiquid financial instruments is reasonable, and in accordance with
IFRS 13 Fair Value Measurement.
IT systems that impact financial reporting (Group and Bank)
Key audit matter description How the scope of our audit responded to the key audit
matter
The Group’s IT environment is inherently complex due to
the number of systems it operates and its reliance on
automated and IT dependent manual controls. Together,
these support a broad range of commercial, treasury, and
trading products as well as the processing of the Group’s
significant volume of transactions, which impact all
account balances.
As such, IT systems within the Group form a critical
component of the Group’s financial reporting activities.
Due to the significant reliance on IT systems, effective
General IT Controls (“GITCs”) are critical to allow reliance
to be placed on the completeness and accuracy of
financial data and the integrity of automated system
functionality, such as system calculations.
We identified the IT systems that impact financial
reporting as a key audit matter because of the:
• pervasive reliance on complex technology that is
integral to the operation of key business processes and
financial reporting;
• reliance on technology which continues to develop in
line with the business strategy, such as the increase in
the use of automation across the Group and increasing
reliance on third parties; and
• importance of the IT controls in maintaining an
effective control environment. A key interdependency
exists between the ability to rely on IT controls and the
ability to rely on financial data, system configured
automated controls and system reports.
IT controls, in the context of our audit scope, primarily
relate to privileged access at the infrastructure level, user
access security at the application level and change control.
Our IT audit scope included testing the Group’s IT controls
over information systems deemed relevant to the audit
based on the financial data, system configured automated
controls and/or key financial reports that reside within it.
We used IT specialists to support our evaluation of the risks
associated with IT in the following areas:
• general IT Controls, including user access and change
management controls;
• key financial reports and system configured automated
controls; and
• cyber security risk assessment.
Where deficiencies in the IT control environment were
identified, our risk assessment procedures included an
assessment of those deficiencies to determine the impact
on our audit plan. Where relevant, the audit plan was
adjusted to mitigate the unaddressed IT risk.
Where we were able to identify and test appropriate
mitigating controls over affected financial statement line
items, our testing approach remained unchanged.
In a limited number of areas, we adopted a non-controls
reliance approach and we therefore performed additional
substantive procedures.
Key observations communicated to the Audit Committee
We are satisfied that the Group’s overall IT control environment appropriately supports the financial reporting process
and control deficiencies identified in respect of privileged user access to IT infrastructure and in application user access
management were mitigated by compensating business controls.
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
6
61Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Credit valuation adjustments (Group and the Bank)
Key audit matter description How the scope of our audit responded to the key audit
matter
Refer to notes 2, 3, 12 and 31 in the financial statements
The Group holds derivative instruments which are subject
to credit valuation adjustments (“CVA”) as part of their
measurement at fair value, and in accordance with IFRS 13
– Fair Value Measurement. The CVA captures the default
risk of the counterparty by adjusting the fair value of a
financial instrument. The Group calculates the CVA for
their derivatives portfolio using market information such as
single-name liquid Credit Default Swap (“CDS”) curves,
sector CDS curves, alongside other market data.
As at 31 December 2024, the Group has a £120 million CVA
reserve on its derivative financial instruments portfolio,
which includes the utilities sector. The estimation of CVA
reserve uses complex valuation models, unobservable
inputs and involves considerable judgment by
management.
Due to the inherent complexity of CVA models and the
potential for material changes in key assumptions driven
by the evolving macroeconomic environment, we have
identified the Group's CVA reserve as a key audit matter.
We tested the controls over the calculation of credit
valuation adjustments reserve, including validation
controls on CVA models.
With the help of our valuation specialists, we performed
the following procedures on credit valuation adjustments:
• evaluated the appropriateness of management’s
methodology to estimate CVA reserve;
• for a sample of counterparties, we calculated an
independent valuation of CVA reserve and compared
results of our independent estimates with the CVA
reserve recognised by the Group;
• assessed the appropriateness of quantitative and
qualitative factors used in counterparty credit rating;
• independently challenged the recovery rates used in the
CVA reserve, specifically for the utilities sector, using
latest financial information and external market data;
• tested the completeness and accuracy of the input data
used in CVA calculation;
• performed a stand back assessment of the
appropriateness of the assumptions, taking into
account macroeconomic conditions and sector specific
consideration; and
• assessed the appropriateness of the financial
instruments disclosures.
Key observation communicated to the Audit Committee
We are satisfied that the credit valuation adjustment reserve is reasonable and in accordance with IFRS 13 – Fair Value
Measurement.
6. Our application of materiality
6.1 Materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the
economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in
planning the scope of our audit work and in evaluating the results of our work.
Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:
Group financial statements Bank financial statements
Materiality £38.2 million (2023: £38.8 million). £38.2 million (2023: £38.8 million).
Basis for
determining
materiality
In determining our benchmark for materiality, we have
considered the metrics used by investors and other
users of the financial statements. We have determined
net assets to be the most relevant to users of the
financial statements.
The Group’s materiality represents 1% of net assets
(total equity).
The Bank’s materiality represents 1% of net
assets (total equity) and is capped at Group
materiality.
Rationale for
the benchmark
applied
Given the importance of these measures to investors and users of the Group and Bank financial
statements, we have used net assets as the primary benchmark for our determination of materiality.
Net assets (Total equity) is a key metric within the financial statements on which the users, being the
owner of the Group, lenders, and regulatory body tends to focus.
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
7
62Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
6.2 Performance materiality
We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected
and undetected misstatements exceed the materiality for the financial statements as a whole.
Group financial statements Bank financial statements
Performance
materiality
70% of Group materiality at £26.7 million (2023: 60% at
£23.3 million)
70% of Bank materiality at £26.7 million
(2023: 60% at £23.2 million)
Basis and
rationale for
determining
performance
materiality
In determining performance materiality, we considered the following factors:
a. the quality of the control environment and whether we were able to rely on controls;
b. degree of centralisation and commonality of controls and processes;
c. the uncertain economic environment;
d. the nature, volume and size of uncorrected misstatements arising in the previous audit; and
e. the nature, volume and size of uncorrected misstatements that remain uncorrected in the
current period.
6.3 Error reporting threshold
We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £1.9
million (2023: £1.9 million), as well as any differences below this threshold, which in our view, warranted reporting on
qualitative grounds. We also report to the Audit Committee on disclosure matters that we identified when assessing the
overall presentation of the financial statements.
7. Other information
The other information comprises the information included in the Annual Report, other than
the financial statements and our auditor’s report thereon. The directors are responsible for
the other information contained within the Annual Report. Our opinion on the financial
statements does not cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the
other information is materially inconsistent with the financial statements or our knowledge
obtained in course of the audit or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude that there is a
material misstatement of this other information, we are required to report that fact.
We have nothing
to report in this
regard.
8. Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true and fair view, and for such internal control as the
directors determine is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Group’s and the Bank’s ability to
continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the Group or the Bank or to cease operations, or have no
realistic alternative but to do so.
9. Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs
(UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
10. Extent to which the audit was considered capable of detecting irregularities, including
fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The
extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
Identifying and assessing potential risks related to irregularities
In identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-
compliance with laws and regulations, we considered the following:
• the nature of the industry and sector, control environment and business performance including the design of the
Group’s and the Bank’s remuneration policies, key drivers for directors’ remuneration, bonus levels and performance
targets;
• results of our enquiries of management, in-house legal counsel, internal audit and the Audit Committee about their
own identification and assessment of the risk of irregularities, including those that are specific to the financial
services sector, including review of supporting documentation, concerning the Group’s policies and procedures
relating to:
– identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of
non-compliance;
– detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or
alleged fraud; and
– the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations;
• the discussion among the audit engagement team including component audit teams and relevant internal
specialists, including tax, valuations, real estate, economic, credit risk, IT and industry specialists regarding how and
where fraud might occur in the financial statements and any potential indicators of fraud; and
• obtaining an understanding of the legal and regulatory frameworks that the Group operates in, focusing on those
laws and regulations that had a direct effect on the financial statements, such as provisions of the UK Companies
Act, pensions legislation and tax legislation or that had a fundamental effect on the operations of the Group and of
the Bank, including regulation and supervisory requirements of the Prudential Regulation Authority, Financial
Reporting Council and Financial Conduct Authority.
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
8
63Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Audit response to risks identified
As a result of performing the above, we identified valuation of complex and illiquid financial instruments held at fair value
as key audit matter related to the potential risk of fraud. The key audit matters section of our report explains the matter
in more detail and also describes the specific procedures in response to that key audit matter. In common with all audits
under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
In addition to the above, our procedures to respond to risks identified included the following:
• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with
provisions of relevant laws and regulations described as having a direct effect on the financial statements;
• enquiring of management, the Audit Committee and in-house legal counsel concerning actual and potential
litigation and claims;
• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of
material misstatement due to fraud;
• reading minutes of meetings of those charged with governance, reviewing internal audit reports and
correspondence with regulators, including the FCA and PRA;
• in addressing the risk of fraud through management override of controls, testing the appropriateness of journal
entries and other adjustments;
• assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and
• evaluating the business rationale of any significant transactions that are unusual or outside the normal course of
business.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team
members including internal specialists, and component audit teams, and remained alert to any indications of fraud or
non-compliance with laws and regulations throughout the audit.
Report on other legal and regulatory requirements
11. Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• The information given in the strategic report and the directors’ report for the financial year for which the financial
statements are prepared is consistent with the financial statements; and
• The strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and of the Bank and their environment obtained in the
course of the audit, we have not identified any material misstatements in the strategic report or the directors’ report.
12. Matters on which we are required to report by exception
Adequacy of explanations received and accounting records
Under the Companies Act 2006 we are required to report to you if, in our opinion:
• we have not received all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the Bank, or returns adequate for
our audit have not been received from branches not visited by us; or
• the Bank’s financial statements are not in agreement with the accounting records and
returns.
We have nothing
to report in
respect of these
matters.
Directors’ remuneration
Under the Companies Act 2006 we are also required to report if in our opinion certain
disclosures of directors’ remuneration have not been made.
We have nothing
to report in
respect of this
matter.
13. Other matters which we are required to address
Auditor tenure
Following the recommendation of the Audit Committee, we were appointed by shareholders at its annual general
meeting on 7 May 2024 to audit the financial statements of Lloyds Bank Corporate Markets plc for the year ended 31
December 2024 and subsequent financial periods. The period of total uninterrupted engagement of the firm is four years.
Consistency of the audit report with the additional report to the Audit Committee
Our audit opinion is consistent with the additional report to the Audit Committee we are required to provide in
accordance with ISAs (UK).
14. Use of our report
This report is made solely to the Bank’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies
Act 2006. Our audit work has been undertaken so that we might state to the Bank’s members those matters we are
required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the Bank and the Bank’s members as a body, for our audit
work, for this report, or for the opinions we have formed.
As required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency Rule (DTR) 4.1.15R – DTR
4.1.18R, these financial statements will form part of the Electronic Format Annual Financial Report filed on the National
Storage Mechanism of the FCA in accordance with DTR 4.1.15R – DTR 4.1.18R. This auditor’s report provides no assurance
over whether the Electronic Format Annual Financial Report has been prepared in compliance with DTR 4.1.15R – DTR
4.1.18R.
For and on behalf of Deloitte LLP
Statutory Auditor
London, United Kingdom
26 February 2025
Independent auditor’s report continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
9
64Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| 2024 | 2023 | ||
| Note | £m | £m | |
Interest income | |||
Interest expense | ( | ( | |
Net interest income | 4 | ||
Fee and commission income | |||
Fee and commission expense | ( | ( | |
Net fee and commission income | 5 | ||
Net trading income | 6 | ||
Other operating (losses) / income | ( | ||
Other income | |||
Total income | |||
Operating expenses | 7 | ( | ( |
Impairment credit | 9 | ||
Profit before tax | |||
Tax expense | 10 | ( | ( |
Profit for the year | |||
Profit attributable to ordinary shareholders | |||
Profit attributable to other equity holders | |||
Profit for the year |
The accompanying notes are an integral part of the financial statements.
Statements of comprehensive income for the year ended 31 December
The Group | The Bank | ||||
| 2024 | 2023 1 | 2024 | 2023 1 | ||
| Note | £m | £m | £m | £m | |
Profit for the year | 378 | 320 | |||
| Other comprehensive income | |||||
| Items that may subsequently be reclassified to profit or loss: | |||||
Movements in revaluation reserve in respect of debt securities held at fair value through other comprehensive income: | |||||
Change in fair value | – | 3 | |||
Deferred tax | ( | – | (1) | ||
24 | – | 2 | |||
| Movements in cash flow hedging reserve: | |||||
Effective portion of changes in fair value taken to other comprehensive income | ( | ( | (236) | (68) | |
Net income statement transfers | 333 | 388 | |||
Deferred tax | ( | ( | (27) | (90) | |
24 | 70 | 230 | |||
| Movements in foreign currency translation reserve: | |||||
Currency translation differences (tax: £nil) | ( | 8 | (16) | ||
24 | ( | 8 | (16) | ||
Total other comprehensive income for the year, net of tax | 78 | 216 | |||
Total comprehensive income for the year | 456 | 536 | |||
Total comprehensive income attributable to ordinary shareholders | 378 | 456 | |||
Total comprehensive income attributable to other equity holders | 78 | 80 | |||
Total comprehensive income for the year | 456 | 536 |
1 See note 1 regarding changes to presentation.
The accompanying notes are an integral part of the financial statements.
Statements
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
10
65Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Balance sheets at 31 December
The Group | The Bank | ||||
| 2024 | 2023 | 2024 | 2023 | ||
| Note | £m | £m | £m | £m | |
| Assets | |||||
Cash and balances at central banks | 20,308 | 20,201 | |||
Financial assets at fair value through profit or loss | 12 | 25,620 | 21,847 | ||
Derivative financial instruments | 13 | 22,416 | 22,606 | ||
Loans and advances to banks | 1,224 | 1,726 | |||
Loans and advances to customers | 14 | 17,524 | 16,167 | ||
Reverse repurchase agreements | 5,332 | 6,020 | |||
Debt securities | 336 | 374 | |||
Due from fellow Lloyds Banking Group undertakings | 642 | 629 | |||
Financial assets at amortised cost | 25,058 | 24,916 | |||
Current tax recoverable | 4 | 10 | |||
Deferred tax assets | 10 | 101 | 128 | ||
Investment in subsidiary undertakings | 17 | 168 | 180 | ||
Other assets 1 | 18 | 1,328 | 487 | ||
Total assets | 95,003 | 90,375 | |||
| Liabilities | |||||
Deposits from banks | 2,645 | 2,078 | |||
Customer deposits | 30,945 | 29,439 | |||
Repurchase agreements at amortised cost | – | 1 | |||
Due to fellow Lloyds Banking Group undertakings | 1,560 | 1,256 | |||
Financial liabilities at fair value through profit or loss | 12 | 22,981 | 19,686 | ||
Derivative financial instruments | 13 | 16,588 | 17,576 | ||
Debt securities in issue at amortised cost | 19 | 15,090 | 15,378 | ||
Other liabilities | 20 | 600 | 280 | ||
Current tax liabilities | 11 | 12 | |||
Provisions | 21 | 10 | 15 | ||
Subordinated liabilities | 22 | 746 | 755 | ||
Total liabilities | 91,176 | 86,476 |
The Group | The Bank | ||||
| 2024 | 2023 | 2024 | 2023 | ||
| Note | £m | £m | £m | £m | |
| Equity | |||||
Share capital | 23 | 370 | 370 | ||
Other reserves | 24 | ( | ( | (236) | (314) |
Retained profits 2 | 25 | 2,885 | 3,035 | ||
Ordinary shareholders’ equity | 3,019 | 3,091 | |||
Other equity instruments | 26 | 808 | 808 | ||
Total equity | 3,827 | 3,899 | |||
Total equity and liabilities | 95,003 | 90,375 |
1 See note 1 regarding changes to presentation.
2 The Bank recorded a profit after tax for the year of £378 million (2023: £320 million).
Statements continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
11
66Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Statements of changes in equity for the year ended 31 December
| Attributable to ordinary shareholders | ||||||
| Share | Other | Retained | Other equity | |||
| capital | reserves | profits | Total | instruments | Total | |
| The Group | £m | £m | £m | £m | £m | £m |
At 1 January 2023 | ( | |||||
| Comprehensive income | ||||||
Profit for the year | ||||||
| Other comprehensive income | ||||||
Movements in revaluation reserve in respect of debt securities held at fair value through other comprehensive income, net of tax | ||||||
Movements in cash flow hedging reserve, net of tax | ||||||
Movements in foreign currency translation reserve, net of tax | ( | ( | ( | |||
Total other comprehensive income | ||||||
Total comprehensive income | ||||||
| Transactions with owners | ||||||
Distributions on other equity instruments | ( | ( | ||||
Net issuance of other equity instruments (note 26) | ||||||
Loss on repayment of other equity instruments | ( | ( | ( | |||
Total transactions with owners | ( | ( | ( | ( | ||
At 31 December 2023 | ( | |||||
| Comprehensive income | ||||||
Profit for the year | ||||||
| Other comprehensive income | ||||||
Movements in cash flow hedging reserve, net of tax | ||||||
Movements in foreign currency translation reserve, net of tax | ||||||
Total other comprehensive income | ||||||
Total comprehensive income 1 | ||||||
| Transactions with owners | ||||||
Dividends | ( | ( | ( | |||
Distributions on other equity instruments | ( | ( | ||||
Total transactions with owners | ( | ( | ( | ( | ||
At | ( |
1 Total comprehensive income attributable to owners of the parent was £481 million (2023: £550 million).
Statements continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
12
67Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Statements of changes in equity continued
Attributable to ordinary shareholders
Other equity
instruments
£mThe Bank
Share
capital
£m
Other
reserves
£m
Retained
profits
£m
Total
£m
Total
£m
At 1 January 2023 370 (530) 2,810 2,650 782 3,432
Comprehensive income
Profit for the year – – 240 240 80 320
Other comprehensive income
Movements in revaluation reserve in respect of debt securities held at fair value through other comprehensive income, net of tax – 2 – 2 – 2
Movements in cash flow hedging reserve, net of tax – 230 – 230 – 230
Movements in foreign currency translation reserve, net of tax – (16) – (16) – (16)
Total other comprehensive income – 216 – 216 – 216
Total comprehensive income – 216 240 456 80 536
Transactions with owners
Distributions on other equity instruments – – – – (80) (80)
Net issuance of other equity instruments (note 26) – – – – 26 26
Loss on repayment of other equity instruments – – (15) (15) – (15)
Total transactions with owners – – (15) (15) (54) (69)
At 31 December 2023 370 (314) 3,035 3,091 808 3,899
Comprehensive income
Profit for the year – – 300 300 78 378
Other comprehensive income
Movements in cash flow hedging reserve, net of tax – 70 – 70 – 70
Movements in foreign currency translation reserve, net of tax – 8 – 8 – 8
Total other comprehensive income – 78 – 78 – 78
Total comprehensive income
1
– 78 300 378 78 456
Transactions with owners
Dividends – – (450) (450) – (450)
Distributions on other equity instruments – – – (78) (78)
Total transactions with owners – – (450) (450) (78) (528)
At 31 December 2024 370 (236) 2,885 3,019 808 3,827
1 Total comprehensive income attributable to owners of the parent was £456 million (2023: £536 million).
The accompanying notes are an integral part of the financial statements. Further details of movements in LBCM’s share capital and reserves are provided in notes 23, 24, 25 and 26.
Statements continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
13
68Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Cash flow statements for the year ended 31 December
The Group | The Bank | ||||
| 2024 | 2023 | 2024 | 2023 | ||
| Note | £m | £m | £m | £m | |
| Cash flows from operating activities | |||||
Profit before tax | 468 | 399 | |||
| Adjustments for: | |||||
Change in operating assets 1 | 33(A) | ( | ( | (5,920) | (1,832) |
Change in operating liabilities | 33(B) | 4,619 | 3,614 | ||
Non-cash and other items | 33(C) | 282 | 702 | ||
Net tax paid | ( | ( | (84) | (96) | |
Net cash (used in) provided by operating activities 1 | ( | (635) | 2,787 | ||
| Cash flows from investing activities | |||||
Purchase of financial assets | ( | – | (3) | ||
Proceeds from sale and maturity of financial assets | – | 10 | |||
Purchase of fixed assets | ( | ( | (2) | (2) | |
Purchase of intangible assets | ( | (4) | – | ||
Proceeds from sale of fixed assets | 1 | – | |||
Net cash (used in) provided by investing activities | ( | (5) | 5 | ||
| Cash flows from financing activities | |||||
Dividends paid to ordinary shareholders | 27 | ( | (450) | – | |
Distributions on other equity instruments | 26 | ( | ( | (78) | (80) |
Interest paid on subordinated liabilities | ( | ( | (54) | (58) | |
Finance leases | ( | ( | (4) | (5) | |
Proceeds from issue of subordinated liabilities | 22 | – | 299 | ||
Repayment of subordinated liabilities | 22 | ( | – | (284) | |
Loss on repayment of other equity instruments | 25 | ( | – | (15) | |
Issue of other equity instruments | 26 | – | 289 | ||
Repurchases and redemptions of other equity instruments | 26 | ( | – | (263) | |
Net cash used in financing activities | ( | ( | (586) | (117) | |
Effect of exchange rate changes on cash and cash equivalents | ( | 116 | (403) | ||
Change in cash and cash equivalents 1 | ( | (1,110) | 2,272 | ||
Cash and cash equivalents at beginning of year 1 | 21,743 | 19,471 | |||
Cash and cash equivalents at end of year 1 | 33(D) | 20,633 | 21,743 |
1 See note 1.
The accompanying notes are an integral part of the financial statements.
Statements continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
14
69Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
GovernanceStrategic report Other informationFinancial statements
Notes to the consolidated
financial statements
In this section
1. Basis of preparation 70
2. Accounting policies 70
3. Critical accounting judgements and key
sources of estimation uncertainty 74
4. Net interest income 75
5. Net fee and commission income 75
6. Net trading income 75
7. Operating expenses 76
8. Auditors’ remuneration 76
9. Impairment 77
10. Tax 77
11. Measurement basis of financial
assets and liabilities 81
12. Fair values of financial
assets and liabilities 89
13. Derivative financial instruments 97
14. Loans and advances to customers 100
15. Finance lease receivables 102
16. Allowance for expected credit losses 102
17. Investment in subsidiary
undertakings of the Bank 108
18. Other assets 108
19. Debt securities in issue
at amortised cost 108
20. Other liabilities 108
21. Provisions 109
22. Subordinated liabilities 109
23. Share capital 109
24. Other reserves 110
25. Retained profits 110
26. Other equity instruments 111
27. Dividends on ordinary shares 111
28. Share-based payments 111
29. Related party transactions 113
30. Contingent liabilities,
commitments and guarantees 115
31. Financial risk management 115
32. Capital 124
33. Cash flow statements 125
34. Events since the balance sheet date 126
35. Other information 126
70Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 2: Accounting policies
The accounting policies are set out below. These accounting policies have been applied consistently.
Notes to the accounts
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
15
71Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 2: Accounting policies continued
costs. Interest calculated using the effective interest method and foreign exchange gains and losses on assets
denominated in foreign currencies are recognised in the income statement. All other gains and losses arising from changes
in fair value are recognised directly in other comprehensive income, until the financial asset is either sold or matures, at
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
16
72Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 2: Accounting policies continued
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
17
73Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 2: Accounting policies continued
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
18
74Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 2: Accounting policies continued
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
19
75Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| 2024 | 2023 | |
| £m | £m | |
| Interest income: | ||
Loans and advances to banks | 1,045 | 1,066 |
Loans and advances to customers | 1,451 | 1,430 |
Reverse repurchase agreements | 244 | 179 |
Debt securities | 19 | 21 |
Total interest income 1 | 2,759 | 2,696 |
| Interest expense: | ||
Deposits from banks | (81) | (78) |
Customer deposits | (1,322) | (1,224) |
Repurchase agreements at amortised cost | (2) | – |
Debt securities in issue at amortised cost 2 | (1,133) | (1,136) |
Lease liabilities | (1) | (2) |
Subordinated liabilities | (54) | (58) |
Total interest expense | (2,593) | (2,498) |
Net interest income | 166 | 198 |
Note 5: Net fee and commission income
| 2024 | 2023 | |
| £m | £m | |
| Fee and commission income: | ||
Current accounts | 3 | 3 |
Debit card fees | 5 | 5 |
Commercial banking and treasury fees | 312 | 292 |
Other fees and commissions | 1 | 3 |
Total fee and commission income | 321 | 303 |
Fee and commission expense | (53) | (39) |
Net fee and commission income | 268 | 264 |
Fees and commissions are an integral part of the effective interest rate and form part of net interest income shown in
note 4. Fees and commissions relating to instruments that are held at fair value through profit or loss are included within
net trading income shown in note 6.
In determining the disaggregation of fees and commissions LBCM has considered how the nature, amount, timing and
uncertainty of revenue and cash flows are affected by economic factors, including those that are impacted by climate-
related factors. It has determined that the above disaggregation by product type provides useful information that does
not aggregate items that have substantially different characteristics and is not too detailed.
At 31 December 2024, LBCM held on its balance sheet £3 million (31 December 2023: £4 million) in respect of services
provided to customers and £nil (31 December 2023: £nil) in respect of amounts received from customers for services to be
provided after the balance sheet date.
Note 6: Net trading income
| 2024 | 2023 | |
| £m | £m | |
| Net gains (losses) arising on assets and liabilities held at fair value through profit or loss: | ||
Financial instruments held for trading | 321 | 270 |
Other financial instruments mandatorily held at fair value through profit or loss | 10 | 28 |
Net losses arising on liabilities designated at fair value through profit or loss | (1) | (1) |
330 | 297 | |
Foreign exchange | 222 | 145 |
Net trading income | 552 | 442 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
20
76Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| 2024 | 2023 | |
| £m | £m | |
| Staff costs: | ||
Salaries | (163) | (167) |
Social security costs | (17) | (17) |
Pensions and other post-retirement benefit schemes | (15) | (15) |
Restructuring costs | (8) | (3) |
Other staff costs | (8) | (9) |
(211) | (211) | |
Management charges payable | (219) | (228) |
Depreciation and amortisation 1 | (9) | (10) |
Premises and equipment | (7) | (6) |
Communications and data processing | (14) | (18) |
Professional fees | (7) | (9) |
Regulatory costs | (14) | (4) |
Other operating expenses | (18) | (23) |
Total operating expenses | (499) | (509) |
| 2024 | 2023 | |
| £m | £m | |
| Fees payable for the: | ||
audit of the Bank's current year Annual Report | 2.5 | 2.4 |
audit of the Bank's subsidiaries | 0.5 | 0.5 |
Total audit fees in respect of the statutory audit of Group entities | 3.0 | 2.9 |
Other audit-related fees | 0.4 | 0.3 |
All other fees | 0.3 | 0.3 |
Total non-audit services | 0.7 | 0.6 |
Total fees payable | 3.7 | 3.5 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
21
77Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 9: Impairment
| Stage 1 | Stage 2 | Stage 3 | Total | |
| £m | £m | £m | £m | |
| Year ended 31 December 2024 | ||||
Loans and advances to banks | 1 | – | – | 1 |
Loans and advances to customers | 7 | 4 | (2) | 9 |
Debt securities | – | 2 | – | 2 |
Financial assets at amortised cost | 8 | 6 | (2) | 12 |
Loan commitments and financial guarantees | 4 | – | – | 4 |
Total impairment credit (charge) | 12 | 6 | (2) | 16 |
| Stage 1 | Stage 2 | Stage 3 | Total | |
| £m | £m | £m | £m | |
| Year ended 31 December 2023 | ||||
Loans and advances to banks | – | 2 | – | 2 |
Loans and advances to customers | 9 | 10 | (1) | 18 |
Debt securities | – | (2) | – | (2) |
Financial assets at amortised cost | 9 | 10 | (1) | 18 |
Loan commitments and financial guarantees | 4 | 6 | – | 10 |
Total impairment credit (charge) | 13 | 16 | (1) | 28 |
Note 10: Tax
(A) Analysis of tax expense for the year
| 2024 | 2023 | |
| £m | £m | |
| UK corporation tax: | ||
Current tax on profit for the year | (32) | (19) |
Adjustments in respect of prior years | 5 | – |
(27) | (19) | |
| Foreign tax: | ||
Current tax on profit for the year | (69) | (57) |
Adjustments in respect of prior years | – | 1 |
(69) | (56) | |
Current tax expense | (96) | (75) |
| UK deferred tax: | ||
Origination and reversal of temporary differences | (1) | (7) |
Adjustments in respect of prior years | – | (3) |
(1) | (10) | |
| Foreign deferred tax: | ||
Origination and reversal of temporary differences | – | (4) |
Deferred tax expense | (1) | (14) |
Tax expense | (97) | (89) |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
22
78Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 10: Tax continued
| 2024 | 2023 | |
| £m | £m | |
Profit before tax | 501 | 427 |
UK corporation tax thereon | (125) | (100) |
Impact of surcharge on banking profits | (3) | (3) |
Non-deductible costs: bank levy | (5) | (5) |
Other non-deductible costs | (2) | (10) |
Non-taxable income | 4 | – |
Tax relief on coupons on other equity instruments | 20 | 19 |
Remeasurement of deferred tax due to rate changes | – | (1) |
Differences in overseas tax rates | 9 | 14 |
Other adjustments in respect of prior years | 5 | (2) |
Other | – | (1) |
Tax expense | (97) | (89) |
Effective tax rate | 19.4% | 20.8% |
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
| Statutory position | ||||
Deferred tax assets | 80 | 108 | 101 | 128 |
Net deferred tax asset at 31 December | 80 | 108 | 101 | 128 |
| Tax disclosure | ||||
Deferred tax assets | 101 | 129 | 101 | 128 |
Deferred tax liabilities | (21) | (21) | – | – |
Net deferred tax asset at 31 December | 80 | 108 | 101 | 128 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
23
79Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 10: Tax continued
| IFRS 9 | Fair value | ||||||
| impairments | through other | Other | |||||
| deductible in the | Other internal | comprehensive | temporary | ||||
| The Group | Tax losses | future | Cash flow hedges | derivatives | income | differences | Total |
| Deferred tax assets | £m | £m | £m | £m | £m | £m | £m |
At 1 January 2023 | 2 | 5 | 202 | 6 | 1 | 17 | 233 |
Charge to the income statement | (2) | (3) | – | (6) | – | (2) | (13) |
Charge to other comprehensive income | – | – | (90) | – | (1) | – | (91) |
Exchange and other adjustments | – | – | – | – | – | – | – |
At 31 December 2023 | – | 2 | 112 | – | – | 15 | 129 |
Charge to the income statement | – | (1) | – | – | – | – | (1) |
Charge to other comprehensive income | – | – | (27) | – | – | – | (27) |
Exchange and other adjustments | – | – | – | – | – | – | – |
At 31 December 2024 | – | 1 | 85 | – | – | 15 | 101 |
| Accelerated | ||
| capital | ||
| The Group | allowances | Total |
| Deferred tax liabilities | £m | £m |
At 1 January 2023 | (20) | (20) |
Charge to the income statement | (1) | (1) |
Charge to other comprehensive income | – | – |
At 31 December 2023 | (21) | (21) |
(Charge) credit to the income statement | – | – |
(Charge) credit to other comprehensive income | – | – |
Exchange and other adjustments | – | – |
At 31 December 2024 | (21) | (21) |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
24
80Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 10: Tax continued
| IFRS 9 | Fair value | |||||
| Impairments | through other | Other | ||||
| deductible in the | comprehensive | temporary | ||||
| The Bank | Tax losses | future | Cash flow hedges | income | differences | Total |
| Deferred tax assets | £m | £m | £m | £m | £m | £m |
At 1 January 2023 | 1 | 5 | 202 | 1 | 17 | 226 |
Charge to the income statement | (1) | (3) | – | – | (2) | (6) |
Charge to other comprehensive income | – | – | (90) | (1) | – | (91) |
Exchange and other adjustments | – | – | – | – | (1) | (1) |
At 31 December 2023 | – | 2 | 112 | – | 14 | 128 |
Charge to the income statement | – | (1) | – | – | 1 | – |
Charge to other comprehensive income | – | – | (27) | – | – | (27) |
Exchange and other adjustments | – | – | – | – | – | – |
At 31 December 2024 | – | 1 | 85 | – | 15 | 101 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
25
81Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
£m | ||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
26
82Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | |||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
27
83Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | ||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
28
84Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | |||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
29
85Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | ||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
30
86Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | |||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
31
87Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | ||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
32
88Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 11: Measurement basis of financial assets and liabilities continued
£m | |||||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
33
89Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
34
90Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
| Level 1 | Level 2 | Level 3 | Total | |
| The Group | £m | £m | £m | £m |
| At 31 December 2024 | ||||
Loans and advances to customers | – | 621 | 2 | 623 |
Reverse repurchase agreements | – | 20,465 | – | 20,465 |
| Debt securities: | ||||
Government securities | 3,473 | – | – | 3,473 |
Bank and building society certificates of deposit | – | 113 | – | 113 |
Asset-backed securities | – | 149 | 8 | 157 |
Corporate and other debt securities | – | 778 | 124 | 902 |
3,473 | 1,040 | 132 | 4,645 | |
Treasury and other bills | 32 | – | – | 32 |
Total financial assets carried at fair value, excluding derivatives | 3,505 | 22,126 | 134 | 25,765 |
| At 31 December 2023 | ||||
Loans and advances to customers | – | 24 | 2 | 26 |
Reverse repurchase agreements | – | 17,413 | – | 17,413 |
| Debt securities: | ||||
Government securities | 3,596 | – | – | 3,596 |
Bank and building society certificates of deposit | – | 91 | – | 91 |
Asset-backed securities | – | 76 | 7 | 83 |
Corporate and other debt securities | – | 583 | 146 | 729 |
3,596 | 750 | 153 | 4,499 | |
Treasury and other bills | 51 | – | – | 51 |
Total financial assets carried at fair value, excluding derivatives | 3,647 | 18,187 | 155 | 21,989 |
| Level 1 | Level 2 | Level 3 | Total | |
| The Bank | £m | £m | £m | £m |
| At 31 December 2024 | ||||
Loans and advances to customers | – | 621 | 2 | 623 |
Reverse repurchase agreements | – | 20,465 | – | 20,465 |
| Debt securities: | ||||
Government securities | 3,473 | – | – | 3,473 |
Asset-backed securities | – | 149 | 8 | 157 |
Corporate and other debt securities | – | 778 | 124 | 902 |
3,473 | 927 | 132 | 4,532 | |
Total financial assets carried at fair value, excluding derivatives | 3,473 | 22,013 | 134 | 25,620 |
| At 31 December 2023 | ||||
Loans and advances to customers | – | 24 | 2 | 26 |
Reverse repurchase agreements | – | 17,413 | – | 17,413 |
| Debt securities: | ||||
Government securities | 3,596 | – | – | 3,596 |
Asset-backed securities | – | 76 | 7 | 83 |
Corporate and other debt securities | – | 583 | 146 | 729 |
3,596 | 659 | 153 | 4,408 | |
Total financial assets carried at fair value, excluding derivatives | 3,596 | 18,096 | 155 | 21,847 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
35
91Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
2024 | 2023 | |||||
| Total level 3 | Total level 3 | |||||
| Financial | assets carried | Financial | assets carried | |||
| assets at | at fair value, | assets at | at fair value, | |||
| Financial | fair value | excluding | Financial | fair value | excluding | |
| assets at fair | through other | derivatives | assets at fair | through other | derivatives | |
| value through | comprehensive | (recurring | value through | comprehensive | (recurring | |
| profit or loss | income | basis) | profit or loss | income | basis) | |
| The Group and the Bank | £m | £m | £m | £m | £m | £m |
At 1 January | 155 | – | 155 | 158 | 6 | 164 |
Exchange and other adjustments | – | – | – | (5) | – | (5) |
| Losses recognised in the income | ||||||
statement within other income | (14) | – | (14) | (10) | – | (10) |
Purchases/increases | – | – | – | 12 | 1 | 13 |
Sales/repayments | (7) | – | (7) | – | (7) | (7) |
At 31 December | 134 | – | 134 | 155 | – | 155 |
| Losses recognised in the income | ||||||
statement, within other income, relating to the change in fair value | ||||||
| of those assets held at 31 | ||||||
December | (14) | – | (14) | (8) | – | (8) |
| Level 1 | Level 2 | Level 3 | Total | |
| The Group and the Bank | £m | £m | £m | £m |
| At 31 December 2024 | ||||
Liabilities designated at fair value through profit or loss | – | – | – | – |
| Trading liabilities: | ||||
| Liabilities in respect of securities sold under repurchase | ||||
agreements | – | 20,564 | – | 20,564 |
Short positions in securities | 2,400 | 17 | – | 2,417 |
Total financial liabilities carried at fair value, excluding derivatives | 2,400 | 20,581 | – | 22,981 |
| At 31 December 2023 | ||||
Liabilities designated at fair value through profit or loss | – | 11 | – | 11 |
| Trading liabilities: | ||||
| Liabilities in respect of securities sold under repurchase | ||||
agreements | – | 18,101 | – | 18,101 |
Short positions in securities | 1,569 | 5 | – | 1,574 |
Total financial liabilities carried at fair value, excluding derivatives | 1,569 | 18,117 | – | 19,686 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
36
92Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
2024 | 2023 | |||||||
| Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |
| The Group and the Bank | £m | £m | £m | £m | £m | £m | £m | £m |
Derivative assets | 16 | 21,651 | 749 | 22,416 | 13 | 22,160 | 433 | 22,606 |
Derivative liabilities | (20) | (16,263) | (305) | (16,588) | (10) | (17,213) | (353) | (17,576) |
2024 | 2023 | |||
| Derivative | Derivative | Derivative | Derivative | |
| assets | liabilities | assets | liabilities | |
| The Group and the Bank | £m | £m | £m | £m |
At 1 January | 433 | (353) | 565 | (494) |
Exchange and other adjustments | (14) | 7 | (8) | 5 |
Gains (losses) recognised in the income statement within other income | 7 | 43 | (103) | 103 |
Purchases/increases | 5 | (4) | 19 | (14) |
Sales/repayments | (29) | 29 | (40) | 47 |
Transfers into the level 3 portfolio | 347 | (27) | – | – |
At 31 December | 749 | (305) | 433 | (353) |
Gains (losses) recognised in the income statement, within other income, relating to the change in fair value of those assets or liabilities held at 31 December | 8 | 17 | (72) | 73 |
| 2024 | 2023 | |
| £m | £m | |
At 1 January | 241 | 336 |
Income statement charge (credit) | (114) | (92) |
Transfers | – | (3) |
At 31 December | 127 | 241 |
| 2024 | 2023 | |
| £m | £m | |
Credit Valuation Adjustment | 120 | 162 |
Debit Valuation Adjustment | (39) | (31) |
Funding Valuation Adjustment | 46 | 110 |
127 | 241 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
37
93Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
The Group and the Bank | 2024 | 2023 | |||||
| Effect of reasonably possible | Effect of reasonably possible | ||||||
alternative assumptions 1 | alternative assumptions 1 | ||||||
| Carrying | Favourable | Unfavourable | Carrying | Favourable | Unfavourable | ||
| Valuation | value | changes | changes | value | changes | changes | |
| techniques | £m | £m | £m | £m | £m | £m | |
| Financial assets at fair value through profit or loss | |||||||
| Loans and advances | Discounted cash | ||||||
| to customers | flows | ||||||
2 | – | – | 2 | – | – | ||
Debt securities | Discounted cash | ||||||
| flows | 132 | 21 | (21) | 153 | 30 | (30) | |
134 | 155 | ||||||
| Derivative financial assets | |||||||
| Interest rate | Option pricing | ||||||
| options | model | ||||||
402 | 5 | (6) | 433 | 6 | (3) | ||
| Interest rate | Discounted cash | ||||||
| derivatives | flows | 347 | 21 | (21) | – | – | – |
749 | 433 | ||||||
Level 3 financial assets carried at fair value | 883 | 588 | |||||
| Derivative financial liabilities | |||||||
| Interest rate | Option pricing | ||||||
| derivatives | model | (305) | 12 | (10) | (353) | 14 | (15) |
Level 3 financial liabilities carried at fair value | (305) | (353) | |||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
38
94Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
| Carrying | Fair | Valuation hierarchy | |||
| value | value | Level 1 | Level 2 | Level 3 | |
| The Group | £m | £m | £m | £m | £m |
| At 31 December 2024 | |||||
Loans and advances to banks | 1,255 | 1,251 | – | – | 1,251 |
Loans and advances to customers | 17,800 | 17,809 | – | – | 17,809 |
Reverse repurchase agreements | 5,332 | 5,332 | – | 5,332 | – |
Debt securities | 336 | 330 | – | 185 | 145 |
Due from fellow Lloyds Banking Group undertakings | 333 | 333 | – | – | 333 |
| At 31 December 2023 | |||||
Loans and advances to banks | 1,753 | 1,753 | – | – | 1,753 |
Loans and advances to customers | 16,447 | 16,376 | – | – | 16,376 |
Reverse repurchase agreements | 6,020 | 6,020 | – | 6,020 | – |
Debt securities | 374 | 368 | – | 184 | 184 |
Due from fellow Lloyds Banking Group undertakings | 297 | 297 | – | – | 297 |
| Carrying | Fair | Valuation hierarchy | |||
| value | value | Level 1 | Level 2 | Level 3 | |
| The Bank | £m | £m | £m | £m | £m |
| At 31 December 2024 | |||||
Loans and advances to banks | 1,224 | 1,220 | – | – | 1,220 |
Loans and advances to customers | 17,524 | 17,534 | – | – | 17,534 |
Reverse repurchase agreements | 5,332 | 5,332 | – | 5,332 | – |
Debt securities | 336 | 330 | – | 185 | 145 |
Due from fellow Lloyds Banking Group undertakings | 642 | 642 | – | – | 642 |
| At 31 December 2023 | |||||
Loans and advances to banks | 1,726 | 1,726 | – | – | 1,726 |
Loans and advances to customers | 16,167 | 16,095 | – | – | 16,095 |
Reverse repurchase agreements | 6,020 | 6,020 | – | 6,020 | – |
Debt securities | 374 | 368 | – | 184 | 184 |
Due from fellow Lloyds Banking Group undertakings | 629 | 629 | – | – | 629 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
39
95Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
| Carrying | Fair | Valuation hierarchy | |||
| value | value | Level 1 | Level 2 | Level 3 | |
| The Group | £m | £m | £m | £m | £m |
| At 31 December 2024 | |||||
Deposits from banks | 2,645 | 2,645 | – | 2,645 | – |
Customer deposits | 30,945 | 30,956 | – | 30,956 | – |
Repurchase agreements at amortised cost | – | – | – | – | – |
Due to fellow Lloyds Banking Group undertakings | 1,512 | 1,512 | – | 1,512 | – |
Debt securities in issue at amortised cost | 15,090 | 15,097 | – | 15,097 | – |
Subordinated liabilities | 746 | 747 | – | 747 | – |
| At 31 December 2023 | |||||
Deposits from banks | 2,078 | 2,078 | – | 2,078 | – |
Customer deposits | 29,439 | 29,462 | – | 29,462 | – |
Repurchase agreements at amortised cost | 1 | 1 | – | 1 | – |
Due to fellow Lloyds Banking Group undertakings | 1,213 | 1,213 | – | 1,213 | – |
Debt securities in issue at amortised cost | 15,378 | 15,273 | – | 15,273 | – |
Subordinated liabilities | 755 | 755 | – | 755 | – |
| Carrying | Fair | Valuation hierarchy | |||
| value | value | Level 1 | Level 2 | Level 3 | |
| The Bank | £m | £m | £m | £m | £m |
| At 31 December 2024 | |||||
Deposits from banks | 2,645 | 2,645 | – | 2,645 | – |
Customer deposits | 30,945 | 30,956 | – | 30,956 | – |
Repurchase agreements at amortised cost | – | – | – | – | – |
Due to fellow Lloyds Banking Group undertakings | 1,560 | 1,560 | – | 1,560 | – |
Debt securities in issue at amortised cost | 15,090 | 15,097 | – | 15,097 | – |
Subordinated liabilities | 746 | 747 | – | 747 | – |
| At 31 December 2023 | |||||
Deposits from banks | 2,078 | 2,078 | – | 2,078 | – |
Customer deposits | 29,439 | 29,462 | – | 29,462 | – |
Repurchase agreements at amortised cost | 1 | 1 | – | 1 | – |
Due to fellow Lloyds Banking Group undertakings | 1,256 | 1,256 | – | 1,256 | – |
Debt securities in issue at amortised cost | 15,378 | 15,273 | – | 15,273 | – |
Subordinated liabilities | 755 | 755 | – | 755 | – |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
40
96Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 12: Fair values of financial assets and liabilities continued
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
41
97Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| 2024 | |||
| Contract/notional | Fair value | Fair value | |
| amount | assets | liabilities | |
| The Group and the Bank | £m | £m | £m |
Trading and other Exchange rate contracts | 690,099 | 8,124 | 7,619 |
Interest rate contracts | 12,237,736 | 14,103 | 8,738 |
Credit derivatives | 2,404 | 8 | 70 |
Commodity and other contracts | 3,692 | 170 | 153 |
Total derivative assets/liabilities - trading and other Hedging | 12,933,931 | 22,405 | 16,580 |
Derivatives designated as fair value hedges | 3,453 | 1 | 4 |
Derivatives designated as cash flow hedges | 16,897 | 10 | 4 |
Total derivative assets/liabilities - hedging | 20,350 | 11 | 8 |
Total recognised derivative assets/liabilities | 12,954,281 | 22,416 | 16,588 |
| 2023 | |||
| Contract/notional | Fair value | Fair value | |
| amount | assets | liabilities | |
| The Group and the Bank | £m | £m | £m |
Trading and other Exchange rate contracts | 553,753 | 5,954 | 5,662 |
Interest rate contracts | 6,905,990 | 16,232 | 11,450 |
Credit derivatives | 1,684 | 2 | 50 |
Commodity and other contracts | 5,520 | 409 | 378 |
Total derivative assets/liabilities - trading and other Hedging | 7,466,947 | 22,597 | 17,540 |
Derivatives designated as fair value hedges | 4,200 | – | 28 |
Derivatives designated as cash flow hedges | 13,963 | 9 | 8 |
Total derivative assets/liabilities - hedging | 18,163 | 9 | 36 |
Total recognised derivative assets/liabilities | 7,485,110 | 22,606 | 17,576 |
| Maturity | ||||||
| The Group and the Bank | Up to 1 month | 1-3 months | 3-12 months | 1-5 years | Over 5 years | Total |
| At 31 December 2024 | £m | £m | £m | £m | £m | £m |
| Fair value hedges | ||||||
| Interest rate | ||||||
| Interest rate swap | ||||||
Notional | 589 | 572 | 112 | 2,180 | – | 3,453 |
Average fixed interest rate | (0.17) % | 0.79 % | 0.03 % | 1.49 % | – % | |
| Cash flow hedges | ||||||
| Interest rate | ||||||
| Interest rate swap | ||||||
Notional | 885 | 373 | 3,304 | 7,617 | 4,718 | 16,897 |
Average fixed interest rate | 2.17 % | 2.41 % | 2.35 % | 2.16 % | 2.71 % |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
42
98Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 13: Derivative financial instruments continued
| The Group and the Bank | Up to 1 month | 1-3 months | 3-12 months | 1-5 years | Over 5 years | Total |
| At 31 December 2023 | £m | £m | £m | £m | £m | £m |
| Fair value hedges | ||||||
| Interest rate | ||||||
| Interest rate swap | ||||||
Notional | – | – | 755 | 3,445 | – | 4,200 |
Average fixed interest rate | – % | – % | 0 . 2 6 % | 1.04 % | – % | |
| Cash flow hedges | ||||||
| Interest rate | ||||||
| Interest rate swap | ||||||
Notional | 353 | 838 | 2,486 | 8,280 | 2,006 | 13,963 |
Average fixed interest rate | 3 . 7 7 % | 0.71 % | 1 . 5 8 % | 1 . 5 2 % | 1.66 % |
| Carrying amount of the hedging instrument | ||||
| Changes in fair | ||||
| Contract/ | value used for | |||
| notional | calculating hedge | |||
| The Group and the Bank | amount | Assets | Liabilities | ineffectiveness |
| At 31 December 2024 | £m | £m | £m | £m |
| Fair value hedges | ||||
| Interest rate | ||||
Interest rate swaps | 3,453 | 1 | 4 | 82 |
| Cash flow hedges | ||||
| Interest rate | ||||
Interest rate swaps | 16,897 | 10 | 4 | 101 |
| Carrying amount of the hedging instrument | ||||
| Changes in fair | ||||
| Contract/ | value used for | |||
| notional | calculating hedge | |||
| The Group and the Bank | amount | Assets | Liabilities | ineffectiveness |
| At 31 December 2023 | £m | £m | £m | £m |
| Fair value hedges | ||||
| Interest rate | ||||
Interest rate swaps | 4,200 | – | 28 | 158 |
| Cash flow hedges | ||||
| Interest rate | ||||
Interest rate swaps | 13,963 | 9 | 8 | 360 |
| Accumulated amount of | Change in | ||||||
| Carrying amount of | fair value adjustment on | fair value of | Cash flow hedging reserve | ||||
| the hedged item | the hedged item | hedged item for | |||||
| ineffectiveness | Continuing | Discontinued | |||||
| The Group and the Bank | Liabilities | Assets | Liabilities | Assets | assessment | hedges | hedges |
| At 31 December 2024 | £m | £m | £m | £m | £m | £m | £m |
| Fair value hedges | |||||||
| Interest rate | |||||||
Fixed rate issuance 1 | 3,437 | – | 25 | – | (82) | ||
| Cash flow hedges | |||||||
| Interest rate | |||||||
Customer loans 2 | (45) | 33 | 1 | ||||
Central bank balances 3 | (30) | (320) | (27) | ||||
Customer deposits 4 | 2 | 4 | 5 | ||||
| Accumulated amount of | Change in | ||||||
| Carrying amount of | fair value adjustment on | fair value of | Cash flow hedging reserve | ||||
| the hedged item | the hedged item | hedged item for | |||||
| ineffectiveness | Continuing | Discontinued | |||||
| The Group and the Bank | Liabilities | Assets | Liabilities | Assets | assessment | hedges | hedges |
| At 31 December 2023 | £m | £m | £m | £m | £m | £m | £m |
| Fair value hedges | |||||||
| Interest rate | |||||||
Fixed rate issuance 1 | 4,065 | – | 111 | – | (157) | ||
| Cash flow hedges | |||||||
| Interest rate | |||||||
Customer loans 2 | (123) | (20) | (2) | ||||
Central bank balances 3 | (180) | (352) | (37) | ||||
Customer deposits 4 | 18 | 5 | 5 | ||||
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
43
99Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 13: Derivative financial instruments continued
| Amounts reclassified from reserves | |||||
| Gain (loss) | to income statement as: | ||||
| recognised | Hedge | ||||
| in other | ineffectiveness | Hedged cash | Hedged item | Income | |
| comprehensive | recognised in the | flows will no | affected income | statement line | |
| The Group and the Bank | income | income statement 1 | longer occur | statement | item that includes |
| At 31 December 2024 | £m | £m | £m | £m | reclassified amount |
| Fair value hedges | |||||
| Interest rate | |||||
Fixed rate issuance | – | ||||
| Cash flow hedges | |||||
| Interest rate | |||||
Customer loans | 93 | – | – | (37) | Interest income |
Central bank balances | (338) | (4) | – | 380 | Interest income |
| Customer deposits | 9 | – | – | (10) | Interest expense |
| Amounts reclassified from reserves | |||||
| Gain (loss) | to income statement as: | ||||
| recognised | Hedge | ||||
| in other | ineffectiveness | Hedged cash | Hedged item | Income | |
| comprehensive | recognised in the | flows will no | affected income | statement line | |
| The Group and the Bank | income | income statement 1 | longer occur | statement | item that includes |
| At 31 December 2023 | £m | £m | £m | £m | reclassified amount |
| Fair value hedges | |||||
| Interest rate | |||||
Fixed rate issuance | 1 | ||||
| Cash flow hedges | |||||
| Interest rate | |||||
Customer loans | 126 | 2 | – | 22 | Interest income |
Central bank balances | (182) | (1) | – | 376 | Interest income |
| Customer deposits | (12) | – | – | (10) | Interest expense |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
44
100Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Gross carrying amount | Allowance for expected credit losses | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Group | £m | £m | £m | £m | £m | £m | £m | £m |
At 1 January 2024 | 16,264 | 193 | 9 | 16,466 | 14 | 5 | – | 19 |
Exchange and other adjustments 1 | (44) | – | – | (44) | – | – | – | – |
Transfers to Stage 1 | 41 | (41) | – | – | 1 | (1) | – | – |
Transfers to Stage 2 | (14) | 17 | (3) | – | – | – | – | – |
Transfers to Stage 3 | (2) | (17) | 19 | – | – | (1) | 1 | – |
Net change in ECL due to transfers | (1) | – | – | (1) | ||||
| Impact of transfers | ||||||||
between stages | 25 | (41) | 16 | – | – | (2) | 1 | (1) |
| Other changes in credit | ||||||||
quality | (3) | – | 1 | (2) | ||||
Additions and repayments | 1,450 | (46) | (16) | 1,388 | (4) | (2) | – | (6) |
(Credit) charge to the income statement | (7) | (4) | 2 | (9) | ||||
Advances written off | (2) | (2) | (2) | (2) | ||||
At 31 December 2024 | 17,695 | 106 | 7 | 17,808 | 7 | 1 | – | 8 |
Allowance for ECL | (7) | (1) | – | (8) | ||||
Net carrying amount | 17,688 | 105 | 7 | 17,800 | ||||
Drawn ECL coverage 2 (%) | – % | 0.9 % | – % | – % |
Gross carrying amount | Allowance for expected credit losses | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Group | £m | £m | £m | £m | £m | £m | £m | £m |
At 1 January 2023 | 18,084 | 1,060 | 22 | 19,166 | 23 | 15 | 1 | 39 |
Exchange and other adjustments 1 | (603) | (15) | – | (618) | – | – | (1) | (1) |
Transfers to Stage 1 | 636 | (636) | – | – | 8 | (8) | – | – |
Transfers to Stage 2 | (47) | 47 | – | – | – | – | – | – |
Transfers to Stage 3 | (2) | – | 2 | – | – | – | – | – |
Net change in ECL due to transfers | (6) | 1 | – | (5) | ||||
| Impact of transfers | ||||||||
between stages | 587 | (589) | 2 | – | 2 | (7) | – | (5) |
| Other changes in credit | ||||||||
quality | (1) | – | 2 | 1 | ||||
Additions and repayments | (1,804) | (263) | (14) | (2,081) | (10) | (3) | (1) | (14) |
(Credit) charge to the income statement | (9) | (10) | 1 | (18) | ||||
Advances written off Recoveries of advances | (2) | (2) | (2) | (2) | ||||
written off in previous years | 1 | 1 | 1 | 1 | ||||
At 31 December 2023 | 16,264 | 193 | 9 | 16,466 | 14 | 5 | – | 19 |
Allowance for ECL | (14) | (5) | – | (19) | ||||
Net carrying amount | 16,250 | 188 | 9 | 16,447 | ||||
Drawn ECL coverage 2 (%) | 0 . 1 % | 2 . 6 % | – % | 0 . 1 % |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
45
101Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 14: Loans and advances to customers continued
Gross carrying amount | Allowance for expected credit losses | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Bank | £m | £m | £m | £m | £m | £m | £m | £m |
At 1 January 2024 | 15,996 | 180 | 9 | 16,185 | 13 | 5 | – | 18 |
Exchange and other adjustments 1 | (45) | – | 1 | (44) | – | – | (1) | (1) |
Transfers to Stage 1 | 36 | (36) | – | – | 1 | (1) | – | – |
Transfers to Stage 2 | (9) | 12 | (3) | – | – | – | – | – |
Transfers to Stage 3 | (1) | (16) | 17 | – | – | (1) | 1 | – |
Net change in ECL due to transfers | (1) | – | – | (1) | ||||
| Impact of transfers | ||||||||
between stages | 26 | (40) | 14 | – | – | (2) | 1 | (1) |
| Other changes in credit | ||||||||
quality | (3) | – | 1 | (2) | ||||
Additions and repayments | 1,451 | (44) | (16) | 1,391 | (4) | (2) | – | (6) |
(Credit) Charge to the income statement | (7) | (4) | 2 | (9) | ||||
Advances written off | (1) | (1) | (1) | (1) | ||||
At 31 December 2024 | 17,428 | 96 | 7 | 17,531 | 6 | 1 | – | 7 |
Allowance for ECL | (6) | (1) | – | (7) | ||||
Net carrying amount | 17,422 | 95 | 7 | 17,524 | ||||
Drawn ECL coverage 2 (%) | — % | 1 . 0 % | — % | — % |
Gross carrying amount | Allowance for expected credit losses | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Bank | £m | £m | £m | £m | £m | £m | £m | £m |
At 1 January 2023 | 17,851 | 1,029 | 22 | 18,902 | 22 | 15 | 1 | 38 |
Exchange and other adjustments 1 | (604) | (13) | 1 | (616) | – | – | (1) | (1) |
Transfers to Stage 1 | 622 | (622) | – | – | 8 | (8) | – | – |
Transfers to Stage 2 | (42) | 42 | – | – | – | – | – | – |
Transfers to Stage 3 | (2) | – | 2 | – | – | – | – | – |
Net change in ECL due to transfers | (6) | 1 | – | (5) | ||||
| Impact of transfers | ||||||||
between stages | 578 | (580) | 2 | – | 2 | (7) | – | (5) |
| Other changes in credit | ||||||||
quality | (2) | 1 | 2 | 1 | ||||
Additions and repayments | (1,829) | (256) | (14) | (2,099) | (9) | (4) | – | (13) |
(Credit) charge to the income statement | (9) | (10) | 2 | (17) | ||||
Advances written off | (2) | (2) | (2) | (2) | ||||
At 31 December 2023 | 15,996 | 180 | 9 | 16,185 | 13 | 5 | – | 18 |
Allowance for ECL | (13) | (5) | – | (18) | ||||
Net carrying amount | 15,983 | 175 | 9 | 16,167 | ||||
Drawn ECL coverage 2 (%) | 0 . 1 % | 2 . 8 % | — % | 0 . 1 % |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
46
102Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| The Group | ||
| 2024 | 2023 | |
| £m | £m | |
Not later than 1 year | 9 | 15 |
Later than 1 year and not later than 2 years | 10 | 10 |
Later than 2 years and not later than 3 years | 11 | 10 |
Later than 3 years and not later than 4 years | 11 | 11 |
Later than 4 years and not later than 5 years | 12 | 11 |
Later than 5 years | 180 | 190 |
Gross investment in finance leases | 233 | 247 |
Unearned future finance income on finance leases | (74) | (85) |
Rentals received in advance | – | (2) |
Net investment in finance leases | 159 | 160 |
| Allowance for expected credit losses | ||||
| Stage 1 | Stage 2 | Stage 3 | Total | |
| At 31 December 2024 | £m | £m | £m | £m |
| In respect of: | ||||
Loans and advances to banks | – | – | – | – |
Loans and advances to customers | 7 | 1 | – | 8 |
Debt securities | – | – | – | – |
Financial assets at amortised cost | 7 | 1 | – | 8 |
Provisions in relation to loan commitments and financial guarantees | 3 | 1 | – | 4 |
Total | 10 | 2 | – | 12 |
| Allowance for expected credit losses | ||||
| Stage 1 | Stage 2 | Stage 3 | Total | |
| At 31 December 2023 | £m | £m | £m | £m |
| In respect of: | ||||
Loans and advances to banks | 2 | – | – | 2 |
Loans and advances to customers | 14 | 5 | – | 19 |
Debt securities | – | 2 | – | 2 |
Financial assets at amortised cost | 16 | 7 | – | 23 |
Provisions in relation to loan commitments and financial guarantees | 7 | 1 | – | 8 |
Total | 23 | 8 | – | 31 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
47
103Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 16: Allowance for expected credit losses continued
| Allowance for expected credit losses | ||||
| Stage 1 | Stage 2 | Stage 3 | Total | |
| At 31 December 2024 | £m | £m | £m | £m |
| In respect of: | ||||
Loans and advances to banks | – | – | – | – |
Loans and advances to customers | 6 | 1 | – | 7 |
Debt securities | – | – | – | – |
Financial assets at amortised cost | 6 | 1 | – | 7 |
Provisions in relation to loan commitments and financial guarantees | 3 | 1 | – | 4 |
Total | 9 | 2 | – | 11 |
| Allowance for expected credit losses | ||||
| Stage 1 | Stage 2 | Stage 3 | Total | |
| At 31 December 2023 | £m | £m | £m | £m |
| In respect of: | ||||
Loans and advances to banks | 2 | – | – | 2 |
Loans and advances to customers | 13 | 5 | – | 18 |
Debt securities | – | 2 | – | 2 |
Financial assets at amortised cost | 15 | 7 | – | 22 |
Provisions in relation to loan commitments and financial guarantees | 7 | 1 | – | 8 |
Total | 22 | 8 | – | 30 |
| Modelled | Individually | Other | Total | |
| ECL | assessed | judgements | ECL | |
| £m | £m | £m | £m | |
At 31 December 2024 | 16 | – | (4) | 12 |
At 31 December 2023 | 34 | – | (3) | 31 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
48
104Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 16: Allowance for expected credit losses continued
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
49
105Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 16: Allowance for expected credit losses continued
| 2024 to | ||||||||
| 2028 | Start to | Start to | ||||||
| 2024 | 2025 | 2026 | 2027 | 2028 | average | peak | trough | |
| At 31 December 2024 | % | % | % | % | % | % | % | % |
| Upside | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.8 | 1.9 | 2.2 | 1.5 | 1.4 | 1.6 | 8.9 | 0.7 |
UK Bank Rate | 5.06 | 4.71 | 5.02 | 5.19 | 5.42 | 5.08 | 5.50 | 4.50 |
UK Unemployment rate | 4.3 | 3.5 | 2.8 | 2.7 | 2.8 | 3.2 | 4.4 | 2.7 |
| UK Commercial real estate | ||||||||
price growth | 0.7 | 7.8 | 6.7 | 3.2 | 0.5 | 3.7 | 20.0 | (0.8) |
| US Gross domestic | ||||||||
product | 2.8 | 3.5 | 3.5 | 1.4 | 0.6 | 2.1 | 11.1 | 0.4 |
US Unemployment rate | 4.0 | 3.6 | 2.6 | 2.7 | 3.5 | 3.3 | 4.2 | 2.4 |
| Base case | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.8 | 1.0 | 1.4 | 1.5 | 1.5 | 1.2 | 7.0 | 0.7 |
UK Bank Rate | 5.06 | 4.19 | 3.63 | 3.50 | 3.50 | 3.98 | 5.25 | 3.50 |
UK Unemployment rate | 4.3 | 4.7 | 4.7 | 4.5 | 4.5 | 4.5 | 4.8 | 4.2 |
| UK Commercial real estate | ||||||||
price growth | 0.7 | 0.3 | 2.5 | 1.9 | 0.0 | 1.1 | 5.4 | (0.8) |
| US Gross domestic | ||||||||
product | 2.8 | 2.0 | 1.8 | 1.9 | 1.9 | 2.0 | 10.2 | 0.4 |
US Unemployment rate | 4.0 | 4.3 | 4.4 | 4.4 | 4.3 | 4.3 | 4.4 | 3.8 |
| Downside | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.8 | (0.5) | (0.4) | 1.0 | 1.5 | 0.5 | 3.2 | 0.0 |
UK Bank Rate | 5.06 | 3.53 | 1.56 | 0.96 | 0.68 | 2.36 | 5.25 | 0.59 |
UK Unemployment rate | 4.3 | 6.0 | 7.4 | 7.4 | 7.1 | 6.4 | 7.5 | 4.2 |
| UK Commercial real estate | ||||||||
price growth | 0.7 | (7.8) | (3.1) | (0.9) | (2.3) | (2.7) | 0.7 | (12.9) |
| US Gross domestic | ||||||||
product | 2.8 | 0.8 | 0.2 | 2.2 | 3.1 | 1.8 | 9.3 | 0.4 |
US Unemployment rate | 4.0 | 5.0 | 6.2 | 6.1 | 5.2 | 5.3 | 6.3 | 3.8 |
| 2024 to | ||||||||
| 2028 | Start to | Start to | ||||||
| 2024 | 2025 | 2026 | 2027 | 2028 | average | peak | trough | |
| At 31 December 2024 | % | % | % | % | % | % | % | % |
| Severe downside | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.8 | (1.9) | (1.5) | 0.7 | 1.3 | (0.1) | 1.2 | (2.4) |
UK Bank Rate - modelled | 5.06 | 2.68 | 0.28 | 0.08 | 0.02 | 1.62 | 5.25 | 0.02 |
UK Bank Rate - adjusted 1 | 5.06 | 4.03 | 2.70 | 2.23 | 1.95 | 3.19 | 5.25 | 1.88 |
UK Unemployment rate | 4.3 | 7.7 | 10.0 | 10.0 | 9.7 | 8.4 | 10.2 | 4.2 |
| UK Commercial real estate | ||||||||
price growth | 0.7 | (17.4) | (8.5) | (5.5) | (5.7) | (7.5) | 0.7 | (32.3) |
| US Gross domestic | ||||||||
product | 2.8 | (1.2) | (2.1) | 2.9 | 5.1 | 1.6 | 8.0 | (2.2) |
US Unemployment rate | 4.0 | 6.2 | 9.1 | 8.6 | 6.5 | 6.9 | 9.4 | 3.8 |
| Probability-weighted | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.8 | 0.5 | 0.8 | 1.2 | 1.4 | 1.0 | 5.7 | 0.7 |
UK Bank Rate - modelled | 5.06 | 4.00 | 3.09 | 2.90 | 2.88 | 3.59 | 5.25 | 2.88 |
UK Bank Rate - adjusted 1 | 5.06 | 4.13 | 3.33 | 3.12 | 3.08 | 3.74 | 5.25 | 3.06 |
UK Unemployment rate | 4.3 | 5.0 | 5.5 | 5.4 | 5.3 | 5.1 | 5.5 | 4.2 |
| UK Commercial real estate | ||||||||
price growth | 0.7 | (1.7) | 1.0 | 0.7 | (1.1) | (0.1) | 0.7 | (1.3) |
| US Gross domestic | ||||||||
product | 2.8 | 1.8 | 1.5 | 1.9 | 2.2 | 1.9 | 10.0 | 0.4 |
US Unemployment rate | 4.0 | 4.5 | 4.9 | 4.8 | 4.5 | 4.5 | 4.9 | 3.8 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
50
106Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 16: Allowance for expected credit losses continued
| 2023 to | ||||||||
| 2027 | Start to | Start to | ||||||
| 2023 | 2024 | 2025 | 2026 | 2027 | average | peak | trough | |
| At 31 December 2023 | % | % | % | % | % | % | % | % |
| Upside | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.3 | 1.5 | 1.7 | 1.7 | 1.9 | 1.4 | 8.1 | 0.2 |
UK Bank Rate | 4.94 | 5.72 | 5.61 | 5.38 | 5.18 | 5.37 | 5.79 | 4.25 |
UK Unemployment rate | 4.0 | 3.3 | 3.1 | 3.1 | 3.1 | 3.3 | 4.2 | 3.0 |
| UK Commercial real estate | ||||||||
price growth | (3.9) | 9.0 | 3.8 | 1.3 | 1.3 | 2.2 | 11.5 | (3.9) |
| US Gross domestic | ||||||||
product | 2.5 | 2.7 | 3.1 | 1.7 | 0.5 | 2.0 | 10.2 | 0.6 |
US Unemployment rate | 3.6 | 3.9 | 3.3 | 3.0 | 3.4 | 3.4 | 4.0 | 3.0 |
| Base case | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.3 | 0.5 | 1.2 | 1.7 | 1.9 | 1.1 | 6.4 | 0.2 |
UK Bank Rate | 4.94 | 4.88 | 4.00 | 3.50 | 3.06 | 4.08 | 5.25 | 3.00 |
UK Unemployment rate | 4.2 | 4.9 | 5.2 | 5.2 | 5.0 | 4.9 | 5.2 | 3.9 |
| UK Commercial real estate | ||||||||
price growth | (5.1) | (0.2) | 0.1 | 0.0 | 0.8 | (0.9) | (1.2) | (5.3) |
| US Gross domestic | ||||||||
product | 2.4 | 1.0 | 1.4 | 1.7 | 1.6 | 1.6 | 8.0 | 0.6 |
US Unemployment rate | 3.6 | 4.3 | 4.5 | 4.4 | 4.3 | 4.2 | 4.5 | 3.5 |
| Downside | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.2 | (1.0) | (0.1) | 1.5 | 2.0 | 0.5 | 3.4 | (1.2) |
UK Bank Rate | 4.94 | 3.95 | 1.96 | 1.13 | 0.55 | 2.51 | 5.25 | 0.43 |
UK Unemployment rate | 4.3 | 6.5 | 7.8 | 7.9 | 7.6 | 6.8 | 8.0 | 3.9 |
| UK Commercial real estate | ||||||||
price growth | (6.0) | (8.7) | (4.0) | (2.1) | (1.2) | (4.4) | (1.2) | (20.4) |
| US Gross domestic | ||||||||
product | 2.3 | (0.4) | (0.6) | 1.0 | 2.1 | 0.9 | 4.4 | 0.4 |
US Unemployment rate | 3.7 | 4.8 | 6.1 | 6.6 | 6.4 | 5.5 | 6.6 | 3.5 |
| 2023 to | ||||||||
| 2027 | Start to | Start to | ||||||
| 2023 | 2024 | 2025 | 2026 | 2027 | average | peak | trough | |
| At 31 December 2023 | % | % | % | % | % | % | % | % |
| Severe downside | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.1 | (2.3) | (0.5) | 1.3 | 1.8 | 0.1 | 1.0 | (2.9) |
UK Bank Rate - modelled | 4.94 | 2.75 | 0.49 | 0.13 | 0.03 | 1.67 | 5.25 | 0.02 |
UK Bank Rate - adjusted 1 | 4.94 | 6.56 | 4.56 | 3.63 | 3.13 | 4.56 | 6.75 | 3.00 |
UK Unemployment rate | 4.5 | 8.7 | 10.4 | 10.5 | 10.1 | 8.8 | 10.5 | 3.9 |
| UK Commercial real estate | ||||||||
price growth | (7.7) | (19.5) | (10.6) | (7.7) | (5.2) | (10.3) | (1.2) | (41.8) |
| US Gross domestic | ||||||||
product | 2.2 | (2.2) | (3.0) | 0.1 | 2.5 | 0.0 | 2.3 | (4.2) |
US Unemployment rate | 3.7 | 5.5 | 8.2 | 9.3 | 9.0 | 7.1 | 9.4 | 3.5 |
| Probability-weighted | ||||||||
| UK Gross domestic | ||||||||
product growth | 0.3 | 0.1 | 0.8 | 1.6 | 1.9 | 0.9 | 5.4 | 0.1 |
UK Bank Rate - modelled | 4.94 | 4.64 | 3.52 | 3.02 | 2.64 | 3.75 | 5.25 | 2.59 |
UK Bank Rate - adjusted 1 | 4.94 | 5.02 | 3.93 | 3.37 | 2.95 | 4.04 | 5.42 | 2.89 |
UK Unemployment rate | 4.2 | 5.3 | 5.9 | 5.9 | 5.7 | 5.4 | 6.0 | 3.9 |
| UK Commercial real estate | ||||||||
price growth | (5.3) | (1.9) | (1.1) | (1.0) | (0.2) | (1.9) | (1.2) | (9.9) |
| US Gross domestic | ||||||||
product | 2.4 | 0.8 | 0.8 | 1.3 | 1.5 | 1.3 | 6.8 | 0.6 |
US Unemployment rate | 3.7 | 4.5 | 5.0 | 5.1 | 5.2 | 4.7 | 5.2 | 3.5 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
51
107Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 16: Allowance for expected credit losses continued
| First | Second | Third | Fourth | First | Second | Third | Fourth | |
| quarter | quarter | quarter | quarter | quarter | quarter | quarter | quarter | |
Base case scenario by quarter 1 | 2024 | 2024 | 2024 | 2024 | 2025 | 2025 | 2025 | 2025 |
| At 31 December 2024 | % | % | % | % | % | % | % | % |
| UK Gross domestic | ||||||||
product growth | 0.7 | 0.4 | 0.0 | 0.1 | 0.2 | 0.3 | 0.3 | 0.3 |
UK Bank Rate | 5.25 | 5.25 | 5.00 | 4.75 | 4.50 | 4.25 | 4.00 | 4.00 |
UK Unemployment rate | 4.3 | 4.2 | 4.3 | 4.4 | 4.5 | 4.6 | 4.7 | 4.8 |
| UK Commercial real estate | ||||||||
price growth | (5.3) | (4.7) | (2.8) | 0.7 | 1.8 | 1.4 | 0.9 | 0.3 |
| US Gross domestic | ||||||||
product | 0.4 | 0.7 | 0.8 | 0.5 | 0.4 | 0.4 | 0.4 | 0.5 |
US Unemployment rate | 3.8 | 4.0 | 4.2 | 4.2 | 4.2 | 4.3 | 4.3 | 4.4 |
| First | Second | Third | Fourth | First | Second | Third | Fourth | |
| quarter | quarter | quarter | quarter | quarter | quarter | quarter | quarter | |
Base case scenario by quarter 1 | 2023 | 2023 | 2023 | 2023 | 2024 | 2024 | 2024 | 2024 |
| At 31 December 2023 | % | % | % | % | % | % | % | % |
| UK Gross domestic | ||||||||
product growth | 0.3 | 0.0 | (0.1) | 0.0 | 0.1 | 0.2 | 0.3 | 0.3 |
UK Bank Rate | 4.25 | 5.00 | 5.25 | 5.25 | 5.25 | 5.00 | 4.75 | 4.50 |
UK Unemployment rate | 3.9 | 4.2 | 4.2 | 4.3 | 4.5 | 4.8 | 5.0 | 5.2 |
| UK Commercial real estate | ||||||||
price growth | (18.8) | (21.2) | (18.2) | (5.1) | (4.1) | (3.8) | (2.2) | (0.2) |
| US Gross domestic | ||||||||
product | 0.6 | 0.5 | 1.3 | 0.0 | 0.0 | 0.1 | 0.2 | 0.3 |
US Unemployment rate | 3.5 | 3.5 | 3.7 | 3.9 | 4.1 | 4.3 | 4.4 | 4.5 |
| Probability- | Severe | ||||
| weighted | Upside | Base case | Downside | downside | |
| £m | £m | £m | £m | £m | |
At 31 December 2024 | 12 | 6 | 10 | 15 | 27 |
At 31 December 2023 | 31 | 17 | 24 | 38 | 68 |
| Severe | ||||
| Upside | Base case | Downside | downside | |
| £m | £m | £m | £m | |
At 31 December 2024 | 6 | 10 | 17 | 49 |
At 31 December 2023 | 15 | 22 | 38 | 129 |
| Severe | ||||
| Upside | Base case | Downside | downside | |
| % | % | % | % | |
At 31 December 2024 | 0.3 | 0.3 | 0.7 | 1.2 |
At 31 December 2023 | 0.5 | 0.6 | 1.8 | 6.3 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
52
108Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| The Bank | ||
| 2024 | 2023 | |
| £m | £m | |
At 1 January | 180 | 180 |
Impairment | (12) | – |
At 31 December | 168 | 180 |
The Group | The Bank | |||
| 2024 | 2023 1 | 2024 | 2023 1 | |
| £m | £m | £m | £m | |
| Property, plant and equipment: | ||||
Premises | 11 | 11 | 6 | 6 |
Equipment | 4 | 6 | 3 | 5 |
Right-of-use assets 2 | 24 | 31 | 23 | 27 |
39 | 48 | 32 | 38 | |
Other intangibles 3 | 4 | – | 4 | – |
Settlement balances | 1,210 | 426 | 1,209 | 411 |
Prepayments and accrued income | 29 | 25 | 23 | 21 |
Other assets | 60 | 19 | 60 | 17 |
Total other assets | 1,342 | 518 | 1,328 | 487 |
Note 19: Debt securities in issue at amortised cost
| The Group and the Bank | ||
| 2024 | 2023 | |
| £m | £m | |
Senior unsecured notes issued | 6,619 | 6,557 |
Certificates of deposit issued | 5,179 | 4,963 |
Commercial paper | 3,292 | 3,858 |
Total debt securities in issue at amortised cost | 15,090 | 15,378 |
At 31 December 2024 £5,009 million (2023: £5,806 million) of debt securities in issue at amortised cost of the Group and
the Bank had a contractual residual maturity of greater than one year.
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
| Settlement balances | 502 | 173 | 501 | 170 |
| Lease liabilities | 32 | 38 | 26 | 30 |
| Other creditors and accruals | 79 | 86 | 73 | 80 |
| Total other liabilities | 613 | 297 | 600 | 280 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
53
109Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| The Group | |||
| Provisions | |||
| for financial | |||
| commitments | |||
| and guarantees | Other | Total | |
| £m | £m | £m | |
At 1 January 2024 | 8 | 8 | 16 |
Exchange and other adjustments | – | – | – |
Provisions applied | – | (5) | (5) |
Charge (credit) for the year | (4) | 4 | – |
At 31 December 2024 | 4 | 7 | 11 |
| The Bank | |||
| Provisions | |||
| for financial | |||
| commitments | |||
| and guarantees | Other | Total | |
| £m | £m | £m | |
At 1 January 2024 | 8 | 7 | 15 |
Exchange and other adjustments | – | – | – |
Provisions applied | – | (4) | (4) |
Charge (credit) for the year | (4) | 3 | (1) |
At 31 December 2024 | 4 | 6 | 10 |
Note 22: Subordinated liabilities
The movement in subordinated liabilities during the year was as follows:
| The Group and the Bank | ||
| 2024 | 2023 | |
| Dated subordinated liabilities | £m | £m |
At 1 January | 755 | 761 |
Issued during the year | – | 299 |
Repurchases and redemptions during the year | – | (284) |
Foreign exchange movements | (1) | (28) |
Other movements (all non-cash) | (8) | 7 |
At 31 December | 746 | 755 |
| The Group and the Bank | ||||
| 2024 | 2023 | 2024 | 2023 | |
| Ordinary shares of £1 each | Number of shares | Number of shares | £m | £m |
At 1 January and 31 December | 370,050,000 | 370,050,000 | 370 | 370 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
54
110Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
Cash flow hedging reserve | (219) | (289) | (219) | (289) |
Foreign currency translation reserve | (17) | (24) | (17) | (25) |
At 31 December | (236) | (313) | (236) | (314) |
The Group | The Bank | |||
| Revaluation reserve in respect of debt securities held at fair value through other | 2024 | 2023 | 2024 | 2023 |
| comprehensive income | £m | £m | £m | £m |
At 1 January | – | (2) | – | (2) |
Change in fair value | – | 3 | – | 3 |
Deferred tax | – | (1) | – | (1) |
– | 2 | – | 2 | |
At 31 December | – | – | – | – |
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| Cash flow hedging reserve | £m | £m | £m | £m |
At 1 January | (289) | (519) | (289) | (519) |
Change in fair value of hedging derivatives | (236) | (68) | (236) | (68) |
Deferred tax | 66 | 18 | 66 | 18 |
(170) | (50) | (170) | (50) | |
Net income statement transfers | 333 | 388 | 333 | 388 |
Deferred tax | (93) | (108) | (93) | (108) |
240 | 280 | 240 | 280 | |
At 31 December | (219) | (289) | (219) | (289) |
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| Foreign currency translation reserve | £m | £m | £m | £m |
At 1 January | (24) | (4) | (25) | (9) |
Currency translation differences arising in the year | 7 | (20) | 8 | (16) |
At 31 December | (17) | (24) | (17) | (25) |
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
At 1 January | 3,011 | 2,768 | 3,035 | 2,810 |
Profit attributable to ordinary shareholders 1 | 326 | 258 | 300 | 240 |
Dividends paid (note 27) | (450) | – | (450) | – |
Loss on repayment of other equity instruments | – | (15) | – | (15) |
At 31 December | 2,887 | 3,011 | 2,885 | 3,035 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
55
111Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
| The Group and the Bank | ||
| 2024 | 2023 | |
| £m | £m | |
At 1 January | 808 | 782 |
| Issued during the year | – | 289 |
| Repurchases and redemptions during the year | – | (263) |
| Profit for the year attributable to other equity holders | 78 | 80 |
| Distributions on other equity instruments | (78) | (80) |
| At 31 December | 808 | 808 |
Note 27: Dividends on ordinary shares
The Bank paid a dividend of £450 million on 25 March 2024. The Bank did not pay a dividend in the period to 31
December 2023.
2024 | 2023 | |||
| Weighted | Weighted | |||
| average | average | |||
| Number | exercise price | Number | exercise price | |
| LBG | of options | (pence) | of options | (pence) |
Outstanding at 1 January | 1,311,205,148 | 31.70 | 1,256,918,075 | 31.30 |
Granted | 200,820,157 | 52.35 | 287,984,574 | 38.55 |
Exercised | (663,187,372) | 24.60 | (164,709,399) | 38.55 |
Forfeited | (17,375,716) | 39.01 | (12,862,726) | 31.78 |
Cancelled | (27,852,684) | 40.70 | (45,807,000) | 37.65 |
Expired | (5,984,747) | 35.40 | (10,318,376) | 38.25 |
Outstanding at 31 December | 797,624,786 | 42.30 | 1,311,205,148 | 31.70 |
Exercisable at 31 December | 955,281 | 24.25 | 410,368 | 39.87 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
56
112Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 28: Share-based payments continued
Other share option plans
Executive Share Plans – buyout and retention awards
Share options may be granted to senior employees under the Lloyds Banking Group Executive Share Plan 2003, Lloyds
Banking Group Executive Group Ownership Share Plan and Deferred Bonus Scheme 2021 specifically to facilitate
recruitment (to compensate new recruits for any lost share awards), and also to make grants to key individuals for
retention purposes. In some instances, grants may be made subject to individual performance conditions.
Participants are not entitled to any dividends paid during the vesting period.
2024 | 2023 | |||
| Weighted | Weighted | |||
| average | average | |||
| Number | exercise price | Number | exercise price | |
| LBG | of Options | (pence) | of Options | (pence) |
Outstanding at 1 January | 26,131,255 | Nil | 20,466,471 | Nil |
Granted | 768,170 | Nil | 15,198,717 | Nil |
Exercised | (10,815,436) | Nil | (8,739,497) | Nil |
Vested | – | Nil | (765,247) | Nil |
Forfeited | (488,091) | Nil | (8,216) | Nil |
Lapsed | (16,901) | Nil | (20,973) | Nil |
Outstanding at 31 December | 15,578,997 | Nil | 26,131,255 | Nil |
Exercisable at 31 December | 988,243 | Nil | 1,148,770 | Nil |
The weighted average fair value of options granted in the year was £0.46 (2023: £0.41). The fair values of options granted
have been determined using a standard Black-Scholes model. The weighted average share price at the time that the
options were exercised during 2024 was £0.53 (2023: £0.46). The weighted average remaining contractual life of options
outstanding at the end of the year was 6.2 years years (2023: 6.3 years).
Other share plans
Lloyds Banking Group Executive Group Ownership Share Plan
The plan, introduced in 2006, is aimed at delivering shareholder value by linking the receipt of shares to an improvement
in the performance of the Lloyds Banking Group over a three-year period. Awards are made within limits set by the rules
of the plan, with the limits determining the maximum number of shares that can be awarded equating to three times
annual salary. In exceptional circumstances this may increase to four times annual salary.
The Executive Group Ownership awards were replaced by Long Term Share Plan awards in 2021.
| 2024 | 2023 | |
| Number of | Number of | |
| LBG | shares | shares |
Outstanding at 1 January | 39,804,293 | 202,394,509 |
Vested | (18,490,246) | (66,555,435) |
Forfeited | (33,055) | (96,034,781) |
Dividend award | 842,202 | – |
Outstanding at 31 December | 22,123,194 | 39,804,293 |
Lloyds Banking Group Long Term Share Plan
The plan, approved at the LBG 2020 AGM and introduced in 2021, replaced the Executive Group Ownership Share Plan
and is intended to provide alignment to LBG’s aim of delivering sustainable returns to shareholders, supported by its
values and behaviours.
The awards in respect of the 2022 grant are due to vest in 2025 at a rate of 100 per cent. Details in relation to the plan
are provided in the LBG directors’ remuneration report.
| 2024 | 2023 | |
| Number of | Number of | |
| LBG | shares | shares |
Outstanding at 1 January | 262,409,389 | 171,947,743 |
Granted | – | 108,551,439 |
Vested | (53,608,504) | – |
Forfeited | (12,921,590) | (18,089,793) |
Outstanding at 31 December | 195,879,295 | 262,409,389 |
The weighted average fair value of awards granted in the year was £nil (2023: £0.42).
Lloyds Banking Group Long Term Incentive Plan
The plan, approved at the LBG 2023 AGM and introduced in 2024, replaced the Long Term Share Plan and is intended to
deliver stronger alignment between variable reward outcomes and the creation of shareholder value through the delivery
of our strategy and the deepening of our relationships with our customers.
The awards in respect of the 2024 grant are due to vest in 2027. Details in relation to the plan are provided in the LBG
directors’ remuneration report.
| 2024 | 2023 | |
| Number | Number | |
| LBG | of shares | of shares |
| Outstanding at 1 January | – | – |
| Granted | 75,063,395 | – |
| Outstanding at 31 December | 75,063,395 | – |
The weighted average fair value of awards granted in the year was £0.30 (2023: £nil).
Executive Share Plans – buyout and retention awards
Share awards in the form of conditional shares may be granted to senior employees under the Lloyds Banking Group
Executive Group Ownership Share Plan and Deferred Bonus Scheme 2021 specifically to facilitate recruitment (to
compensate new recruits for any lost share awards), and also to make grants to key individuals for retention purposes. In
some instances, grants may be made subject to individual performance conditions.
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
57
113Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 28: Share-based payments continued
2024 | 2023 | |
| Number | Number | |
| LBG | of Shares | of Shares |
Outstanding at 1 January | – | – |
Granted | 3,593,397 | – |
Vested | (728,370) | – |
Forfeited | – | – |
| Outstanding at 31 December | 2,865,027 | – |
| Executive | Executive | Long Term | ||
| SAYE | Option Plans | Share Plans | Share Plan | |
Weighted average risk-free interest rate | 3.58% | 4.43% | 4.35% | 4.07% |
Weighted average expected life | 3.3 years | 1.6 years | 1.3 years | 4.4 years |
Weighted average expected volatility | 25% | 24% | 23% | 29% |
Weighted average expected dividend yield | 6.0% | 7.0% | 7.0% | 7.0% |
Weighted average share price | £0.58 | £0.52 | £0.56 | £0.48 |
Weighted average exercise price | £0.52 | Nil | Nil | Nil |
| 2024 | 2023 | |
| £000 | £000 | |
| Compensation | ||
Salaries and other short-term benefits | 3,332 | 2,823 |
Post-employment benefits | 48 | 76 |
Total compensation | 3,380 | 2,899 |
| 2024 | 2023 | |
| £m | £m | |
| Deposits | ||
At 1 January | 3 | 3 |
Placed (includes deposits of appointed key management personnel) | – | 1 |
Withdrawn (includes deposits of former key management personnel) | (3) | (1) |
At 31 December | – | 3 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
58
114Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 29: Related party transactions continued
| 2024 | 2023 | |
| £m | £m | |
| Assets, included within: | ||
| Financial assets at amortised cost: due from fellow Lloyds Bank Corporate Markets Group | ||
undertakings | 342 | 359 |
342 | 359 | |
| Liabilities, included within: | ||
Due to fellow Lloyds Bank Corporate Markets Group undertakings | 49 | 45 |
49 | 45 |
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
| Assets, included within: | ||||
Financial assets at fair value through profit or loss | 37 | 54 | 37 | 54 |
Derivative financial instruments | 2,490 | 3,173 | 2,490 | 3,173 |
| Financial assets at amortised cost: due from fellow Lloyds Banking | ||||
Group undertakings | 333 | 297 | 300 | 270 |
2,860 | 3,524 | 2,827 | 3,497 | |
| Liabilities, included within: | ||||
Due to fellow Lloyds Banking Group undertakings | 1,512 | 1,213 | 1,511 | 1,211 |
Financial liabilities at fair value through profit or loss | – | 45 | – | 45 |
Derivative financial instruments | 1,352 | 2,291 | 1,352 | 2,291 |
Debt securities in issue at amortised cost | 3,307 | 2,720 | 3,307 | 2,720 |
Subordinated liabilities | 748 | 748 | 748 | 748 |
6,919 | 7,017 | 6,918 | 7,015 | |
| Other equity instruments: | ||||
Additional tier 1 instruments | 808 | 808 | 808 | 808 |
808 | 808 | 808 | 808 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
59
115Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
60
116Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
Agriculture, forestry and fishing | – | 1 | – | 1 |
Construction 1 | 23 | 15 | 23 | 15 |
Energy and water supply | 60 | 32 | 60 | 32 |
Financial, business and other services | 14,698 | 13,500 | 14,698 | 13,500 |
Hire purchase | 78 | 79 | – | – |
Lease financing | 159 | 160 | – | – |
Manufacturing | 321 | 259 | 321 | 259 |
Mining and quarrying 1 | 1 | 7 | 1 | 7 |
| Personal: | ||||
Mortgages | 1,569 | 1,514 | 1,569 | 1,514 |
Other | 49 | 52 | 9 | 10 |
Postal and telecommunications | 101 | 172 | 101 | 172 |
Property companies | 467 | 604 | 467 | 604 |
Transport, distribution and hotels | 282 | 71 | 282 | 71 |
Total loans and advances to customers before allowance for impairment losses | 17,808 | 16,466 | 17,531 | 16,185 |
Allowance for impairment losses (note 16) | (8) | (19) | (7) | (18) |
Total loans and advances to customers | 17,800 | 16,447 | 17,524 | 16,167 |
| Commercial | |
Quality classification | IFRS 9 PD Range |
CMS 1-10 | 0.00-0.50% |
CMS 11-14 | 0.51-3.00% |
CMS 15-18 | 3.01-20.00% |
CMS 19 | 20.01-99.99% |
CMS 20-23 | 100.00% |
Gross Drawn exposures | Expected credit loss allowance | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Group | £m | £m | £m | £m | £m | £m | £m | £m |
| At 31 December 2024 | ||||||||
CMS 1-10 | 16,926 | 19 | – | 16,945 | 3 | – | – | 3 |
CMS 11-14 | 702 | 77 | – | 779 | 2 | 1 | – | 3 |
CMS 15-18 | 66 | 8 | – | 74 | 2 | – | – | 2 |
CMS 19 | 1 | 2 | – | 3 | – | – | – | – |
CMS 20-23 | – | – | 7 | 7 | – | – | – | – |
17,695 | 106 | 7 | 17,808 | 7 | 1 | – | 8 |
Gross Drawn exposures | Expected credit loss allowance | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Group | £m | £m | £m | £m | £m | £m | £m | £m |
| At 31 December 2023 | ||||||||
CMS 1-10 | 15,315 | 9 | – | 15,324 | 9 | – | – | 9 |
CMS 11-14 | 846 | 134 | – | 980 | 3 | 2 | – | 5 |
CMS 15-18 | 101 | 45 | – | 146 | 2 | 2 | – | 4 |
CMS 19 | 2 | 5 | – | 7 | – | 1 | – | 1 |
CMS 20-23 | – | – | 9 | 9 | – | – | – | – |
16,264 | 193 | 9 | 16,466 | 14 | 5 | – | 19 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
61
117Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
Gross Drawn exposures | Expected credit loss allowance | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Bank | £m | £m | £m | £m | £m | £m | £m | £m |
| At 31 December 2024 | ||||||||
CMS 1-10 | 16,839 | 14 | – | 16,853 | 2 | – | – | 2 |
CMS 11-14 | 523 | 74 | – | 597 | 2 | 1 | – | 3 |
CMS 15-18 | 66 | 7 | – | 73 | 2 | – | – | 2 |
CMS 19 | – | 1 | – | 1 | – | – | – | – |
CMS 20-23 | – | – | 7 | 7 | – | – | – | – |
17,428 | 96 | 7 | 17,531 | 6 | 1 | – | 7 |
Gross Drawn exposures | Expected credit loss allowance | |||||||
| Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |
| The Bank | £m | £m | £m | £m | £m | £m | £m | £m |
| At 31 December 2023 | ||||||||
CMS 1-10 | 15,052 | 3 | – | 15,055 | 8 | – | – | 8 |
CMS 11-14 | 843 | 130 | – | 973 | 3 | 2 | – | 5 |
CMS 15-18 | 101 | 43 | – | 144 | 2 | 2 | – | 4 |
CMS 19 | – | 4 | – | 4 | – | 1 | – | 1 |
CMS 20-23 | – | – | 9 | 9 | – | – | – | – |
15,996 | 180 | 9 | 16,185 | 13 | 5 | – | 18 |
2024 | 2023 | |||||
| Investment | Investment | |||||
grade 1 | Other | Total | grade 1 | Other | Total | |
| The Group | £m | £m | £m | £m | £m | £m |
Other financial assets mandatorily at fair value through profit or loss: | ||||||
| Debt securities: | ||||||
| Bank and building society certificates | ||||||
of deposit | 113 | – | 113 | 91 | – | 91 |
Asset-backed securities | – | 8 | 8 | 7 | 7 | |
Corporate and other debt securities | – | 124 | 124 | – | 146 | 146 |
113 | 132 | 245 | 91 | 153 | 244 | |
Treasury and other bills | 32 | – | 32 | 51 | – | 51 |
Total other financial assets mandatorily at fair value through profit or loss (excluding | ||||||
Loans and advances to customers) | 145 | 132 | 277 | 142 | 153 | 295 |
2024 | 2023 | |||||
| Investment | Investment | |||||
grade 1 | Other | Total | grade 1 | Other | Total | |
| The Bank | £m | £m | £m | £m | £m | £m |
Other financial assets mandatorily at fair value through profit or loss: | ||||||
| Debt securities: | ||||||
Asset-backed securities | – | 8 | 8 | – | 7 | 7 |
Corporate and other debt securities | – | 124 | 124 | – | 146 | 146 |
Total other financial assets mandatorily at fair value through profit or loss (excluding | ||||||
Loans and advances to customers) | – | 132 | 132 | – | 153 | 153 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
62
118Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
2024 | 2023 | |||||
| Investment | Investment | |||||
grade 1 | Other | Total | grade 1 | Other | Total | |
| The Group and the Bank | £m | £m | £m | £m | £m | £m |
Trading and other | 18,855 | 1,060 | 19,915 | 18,667 | 757 | 19,424 |
Hedging | 11 | – | 11 | 9 | – | 9 |
18,866 | 1,060 | 19,926 | 18,676 | 757 | 19,433 | |
| Due from fellow Lloyds Banking Group | ||||||
undertakings | 2,490 | 3,173 | ||||
Total derivative financial instruments | 22,416 | 22,606 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
63
119Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
| The Group and the Bank | ||
| 2024 | 2023 | |
| £m | £m | |
Financial assets at fair value through profit or loss | 521 | 512 |
2024 | 2023 | |||
| US Dollar | EUR | US Dollar | EUR | |
| The Group and the Bank | £m | £m | £m | £m |
Exposure | 207 | 36 | 155 | 29 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
64
120Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
At 31 December 2024 | At 31 December 2023 | |||||||
| Close | Average | Maximum | Minimum | Close | Average | Maximum | Minimum | |
| £m | £m | £m | £m | £m | £m | £m | £m | |
Interest rate risk | 4.0 | 2.4 | 5.4 | 1.2 | 1.6 | 2.0 | 3.8 | 0.9 |
Foreign exchange risk | 0.1 | 0.2 | 0.7 | 0.1 | 0.1 | 0.3 | 0.9 | 0.1 |
Equity risk | – | – | – | – | — | — | — | — |
Credit spread risk | 0.2 | 0.3 | 0.4 | 0.2 | 0.2 | 0.3 | 0.5 | 0.1 |
Inflation risk | 0.1 | 0.3 | 0.7 | 0.1 | 0.5 | 0.5 | 1.0 | 0.2 |
All risk factors before diversification | 4.4 | 3.1 | 6.2 | 2.0 | 2.5 | 3.1 | 5.0 | 1.9 |
Portfolio diversification | (0.6) | (0.8) | – | – | (0.9) | (0.8) | — | — |
Total VaR | 3.6 | 2.3 | 5.0 | 1.3 | 1.6 | 2.2 | 4.0 | 1.2 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
65
121Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
2024 | 2023 | |||||||
| Up | Down | Up | Down | Up | Down | Up | Down | |
| 25bps | 25bps | 100bps | 100bps | 25bps | 25bps | 100bps | 100bps | |
| £m | £m | £m | £m | £m | £m | £m | £m | |
Sterling | (0.4) | 0.4 | (1.6) | 1.7 | 0.1 | (0.1) | 0.4 | (0.6) |
US Dollar | (0.2) | 0.2 | (0.7) | 0.7 | (0.1) | 0.1 | (0.3) | 0.3 |
Euro | 0.5 | (0.5) | 1.8 | (1.8) | (0.4) | 0.4 | (1.7) | 1.7 |
Other | – | – | – | – | – | – | – | – |
Total | (0.1) | 0.1 | (0.5) | 0.6 | (0.4) | 0.4 | (1.6) | 1.4 |
2024 | 2023 | |||
| Steepener | Flattener | Steepener | Flattener | |
| £m | £m | £m | £m | |
Sterling | 0.7 | (0.4) | 1.9 | (2.0) |
US Dollar | 0.4 | (0.4) | 0.3 | (0.3) |
Euro | (1.1) | 1.1 | 0.8 | (0.8) |
Other | – | – | – | – |
Total | – | 0.3 | 3.0 | (3.1) |
2024 | 2023 | |||||
| Year 1 | Year 2 | Year 3 | Year 1 | Year 2 | Year 3 | |
| Customer-facing activity and associated hedges | £m | £m | £m | £m | £m | £m |
Up 50bps | 6.4 | 9.6 | 12.9 | 0.9 | 7.4 | 10.9 |
Up 25bps | 3.2 | 5.0 | 6.5 | 0.5 | 3.7 | 5.5 |
Down 25bps | (4.1) | (6.1) | (7.4) | (2.4) | (5.2) | (6.9) |
Down 50bps | (8.3) | (12.3) | (14.8) | (4.8) | (10.5) | (13.9) |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
66
122Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
67
123Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
| Up to 1 | 1-3 | 3-12 | 1-5 | Over 5 | ||
| month | months | months | years | years | Total | |
| The Group | £m | £m | £m | £m | £m | £m |
| At 31 December 2024 | ||||||
Deposits from banks | 20 | 331 | 400 | 1,905 | – | 2,656 |
Customer deposits | 16,255 | 6,063 | 5,956 | 2,732 | 39 | 31,045 |
Repurchase agreements at amortised cost | – | – | – | – | – | – |
Financial liabilities at fair value through profit or loss | 15,199 | 3,886 | 1,389 | 1,462 | 1,228 | 23,164 |
Debt securities in issue at amortised cost | 1,666 | 1,927 | 7,167 | 5,258 | – | 16,018 |
Lease liabilities | – | 1 | 3 | 19 | 19 | 42 |
Subordinated liabilities | – | 7 | 350 | 492 | – | 849 |
Total non-derivative financial liabilities | 33,140 | 12,215 | 15,265 | 11,868 | 1,286 | 73,774 |
| Derivative financial liabilities: | ||||||
Gross-settled derivatives – outflows | 99,972 | 59,229 | 40,220 | 32,299 | 17,881 | 249,601 |
Gross-settled derivatives – inflows | (97,301) | (57,288) | (38,744) | (30,328) | (15,615) | (239,276) |
Gross-settled derivatives – net flows | 2,671 | 1,941 | 1,476 | 1,971 | 2,266 | 10,325 |
Net-settled derivative liabilities | 8,969 | – | – | – | – | 8,969 |
Total derivative financial liabilities | 11,640 | 1,941 | 1,476 | 1,971 | 2,266 | 19,294 |
| At 31 December 2023 | ||||||
Deposits from banks | 148 | 126 | 381 | 1,434 | – | 2,089 |
Customer deposits | 14,889 | 5,343 | 7,025 | 2,197 | 70 | 29,524 |
Repurchase agreements at amortised cost | 1 | – | – | – | – | 1 |
Financial liabilities at fair value through profit or loss | 8,728 | 4,109 | 5,273 | 706 | 1,421 | 20,237 |
Debt securities in issue at amortised cost | 958 | 1,389 | 8,080 | 5,777 | – | 16,204 |
Lease liabilities | – | 2 | 5 | 24 | 11 | 42 |
Subordinated liabilities | 6 | 8 | 44 | 849 | – | 907 |
Total non-derivative financial liabilities | 24,730 | 10,977 | 20,808 | 10,987 | 1,502 | 69,004 |
| Derivative financial liabilities: | ||||||
Gross-settled derivatives – outflows | 81,583 | 50,528 | 42,176 | 30,881 | 13,769 | 218,937 |
Gross-settled derivatives – inflows | (79,683) | (48,953) | (41,035) | (30,685) | (14,102) | (214,458) |
Gross-settled derivatives – net flows | 1,900 | 1,575 | 1,141 | 196 | (333) | 4,479 |
Net-settled derivative liabilities | 11,913 | – | – | – | – | 11,913 |
Total derivative financial liabilities | 13,813 | 1,575 | 1,141 | 196 | (333) | 16,392 |
| Up to 1 | 1-3 | 3-12 | 1-5 | Over 5 | ||
| month | months | months | years | years | Total | |
| The Bank | £m | £m | £m | £m | £m | £m |
| At 31 December 2024 | ||||||
Deposits from banks | 20 | 331 | 400 | 1,905 | – | 2,656 |
Customer deposits | 16,255 | 6,063 | 5,956 | 2,732 | 39 | 31,045 |
Repurchase agreements at amortised cost | – | – | – | – | – | – |
Financial liabilities at fair value through profit or loss | 15,199 | 3,886 | 1,389 | 1,462 | 1,228 | 23,164 |
Debt securities in issue at amortised cost | 1,666 | 1,927 | 7,167 | 5,258 | – | 16,018 |
Lease liabilities | – | 1 | 3 | 17 | 15 | 36 |
Subordinated liabilities | – | 7 | 350 | 492 | – | 849 |
Total non-derivative financial liabilities | 33,140 | 12,215 | 15,265 | 11,866 | 1,282 | 73,768 |
| Derivative financial liabilities: | ||||||
Gross-settled derivatives – outflows | 99,972 | 59,229 | 40,220 | 32,299 | 17,881 | 249,601 |
Gross-settled derivatives – inflows | (97,301) | (57,288) | (38,744) | (30,328) | (15,615) | (239,276) |
Gross-settled derivatives – net flows | 2,671 | 1,941 | 1,476 | 1,971 | 2,266 | 10,325 |
Net-settled derivative liabilities | 8,969 | – | – | – | – | 8,969 |
Total derivative financial liabilities | 11,640 | 1,941 | 1,476 | 1,971 | 2,266 | 19,294 |
| At 31 December 2023 | ||||||
Deposits from banks | 148 | 126 | 381 | 1,434 | – | 2,089 |
Customer deposits | 14,889 | 5,343 | 7,025 | 2,197 | 70 | 29,524 |
Repurchase agreements at amortised cost | 1 | – | – | – | – | 1 |
Financial liabilities at fair value through profit or loss | 8,728 | 4,109 | 5,273 | 706 | 1,421 | 20,237 |
Debt securities in issue at amortised cost | 958 | 1,389 | 8,080 | 5,777 | – | 16,204 |
Lease liabilities | – | 1 | 3 | 20 | 6 | 30 |
Subordinated liabilities | 6 | 8 | 44 | 849 | – | 907 |
Total non-derivative financial liabilities | 24,730 | 10,976 | 20,806 | 10,983 | 1,497 | 68,992 |
| Derivative financial liabilities: | ||||||
Gross-settled derivatives – outflows | 81,583 | 50,528 | 42,176 | 30,881 | 13,769 | 218,937 |
Gross-settled derivatives – inflows | (79,683) | (48,953) | (41,035) | (30,685) | (14,102) | (214,458) |
Gross-settled derivatives – net flows | 1,900 | 1,575 | 1,141 | 196 | (333) | 4,479 |
Net-settled derivative liabilities | 11,913 | – | – | – | – | 11,913 |
Total derivative financial liabilities | 13,813 | 1,575 | 1,141 | 196 | (333) | 16,392 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
68
124Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 31: Financial risk management continued
| Within 1 | 1-3 | 3-5 | Over 5 | ||
| year | years | years | years | Total | |
| The Group and the Bank | £m | £m | £m | £m | £m |
| At 31 December 2024 | |||||
Other contingent liabilities | 75 | – | 7 | – | 82 |
Lending commitments and guarantees | 15,678 | 2,127 | 2,736 | 172 | 20,713 |
Total contingents, commitments and guarantees | 15,753 | 2,127 | 2,743 | 172 | 20,795 |
| Within 1 | 1-3 | 3-5 | Over 5 | ||
| year | years | years | years | Total | |
| The Group and the Bank | £m | £m | £m | £m | £m |
| At 31 December 2023 | |||||
Other contingent liabilities | 84 | 3 | 7 | – | 94 |
Lending commitments and guarantees | 12,350 | 6,531 | 2,552 | 194 | 21,627 |
Total contingents, commitments and guarantees | 12,434 | 6,534 | 2,559 | 194 | 21,721 |
| 2024 | 2023 | |
| £m | £m | |
Common equity tier 1 capital | 2,797 | 2,725 |
Additional tier 1 capital | 783 | 783 |
Tier 2 capital | 591 | 601 |
Total capital | 4,171 | 4,109 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
69
125Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 33: Cash flow statements
(A) Change in operating assets
The Group | The Bank | |||
| 2024 | 2023 1 | 2024 | 2023 1 | |
| £m | £m | £m | £m | |
| Change in amounts due from fellow Lloyds Banking Group | ||||
undertakings | (37) | (28) | (13) | (36) |
Change in other financial assets held at amortised cost | (1,432) | 3,720 | (1,435) | 3,735 |
Change in financial assets at fair value through profit or loss | (3,774) | (7,217) | (3,773) | (7,205) |
Change in derivative financial instruments | (46) | 1,947 | (46) | 1,973 |
Change in other operating assets | (639) | (313) | (653) | (299) |
Change in operating assets | (5,928) | (1,891) | (5,920) | (1,832) |
1 See note 1.
(B) Change in operating liabilities
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
Change in deposits from banks | 567 | (375) | 567 | (375) |
Change in customer deposits and repurchase agreements | 1,480 | 366 | 1,480 | 366 |
Change in amounts due to fellow Lloyds Banking Group undertakings | 299 | (268) | 304 | (270) |
Change in financial liabilities at fair value through profit or loss | 3,295 | 7,108 | 3,295 | 7,108 |
Change in derivative financial instruments | (988) | (2,494) | (988) | (2,494) |
Change in debt securities in issue | (362) | (453) | (362) | (453) |
Change in other operating liabilities 1 | 323 | (266) | 323 | (268) |
Change in operating liabilities | 4,614 | 3,618 | 4,619 | 3,614 |
1 Includes a decrease of £6 million (2023: a decrease of £7 million) for the Group and a decrease of £4 million (2023: a decrease of £6 million)
for the Bank in respect of lease liabilities.
(C) Non-cash and other items
The Group | The Bank | |||
| 2024 | 2023 | 2024 | 2023 | |
| £m | £m | £m | £m | |
Depreciation and amortisation | 9 | 10 | 7 | 10 |
Impairment of investment in subsidiaries | – | – | 12 | – |
Allowance for loan losses (net of recoveries) | (13) | (18) | (13) | (18) |
Impairment charge/(credit) relating to undrawn balances | (4) | (10) | (4) | (10) |
Unwind of discount on impairment allowances | – | – | – | – |
Other provision movements | (1) | – | (1) | – |
Foreign exchange impact on balance sheet 1 | (98) | 273 | (97) | 268 |
Other non-cash items | 380 | 452 | 378 | 452 |
Non-cash and other items | 273 | 707 | 282 | 702 |
1 When considering the movement on each line of the balance sheet, the impact of foreign exchange rate movements is removed in order to
show the underlying cash impact.
The Group | The Bank | |||
| 2024 | 2023 2 | 2024 | 2023 2 | |
| £m | £m | £m | £m | |
Cash and balances at central banks | 20,308 | 20,201 | 20,308 | 20,201 |
Less mandatory reserve deposits 1 | – | (190) | – | (190) |
20,308 | 20,011 | 20,308 | 20,011 | |
Loans and advances to banks and reverse repurchase agreements | 1,685 | 3,662 | 1,654 | 3,635 |
Less amounts with a maturity of three months or more | (1,329) | (1,903) | (1,329) | (1,903) |
356 | 1,759 | 325 | 1,732 | |
Total cash and cash equivalents | 20,664 | 21,770 | 20,633 | 21,743 |
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
70
126Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Governance Financial statementsStrategic report Other information
Note 34: Events since the balance sheet date
There are no events since the balance sheet date to disclose.
Note 35: Other information
registered number 10399850 . Lloyds Bank Corporate Markets plc’s registered office is 25 Gresham Street, London, EC2V
Lloyds Bank Corporate Markets plc and its subsidiaries form a leading UK-based financial services group, whose
businesses provide a wide range of banking and financial services in the UK and overseas.
Lloyds Bank Corporate Markets plc’s immediate parent undertaking and ultimate parent undertaking and controlling
party is Lloyds Banking Group plc which is incorporated in Scotland. Copies of the consolidated annual report and
accounts of Lloyds Banking Group plc may be obtained from Lloyds Banking Group’s head office at 25 Gresham Street,
London EC2V 7HN or downloaded via www.lloydsbankinggroup.com.
Notes to the accounts continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
71
128Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Other informationStrategic report Governance Financial statements
Subsidiaries and related undertakings
In compliance with Section 409 of the Companies Act 2006, the following comprises a list of all related undertakings of
LBCM, as at 31December 2024. The list includes each undertaking’s registered office and the percentage of the class(es) of
shares held by LBCM. All shares held are ordinary shares unless indicated otherwise in the notes.
The Bank directly or indirectly holds 100 per cent of the share class and a majority of voting rights in the following
undertakings.
Subsidiary undertaking Registered office address Bank interest
Black Horse Offshore Limited 9 Broad Street
St Helier
Jersey JE2 3RR
100%
Lloyds America Securities Corporation The Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington
Delaware 19801
100%
1
Lloyds Bank Corporate Asset Finance (No.1) Limited 25 Gresham Street
London EC2V 7HN
100%
Lloyds Bank Corporate Markets Wertpapierhandelsbank GmbH Thurn-Und
Frankfurt Am Main 60313
Germany
100%
Lloyds International Management Services (Jersey) Limited
(formerly Lloyds Bank International Limited)
9 Broad Street
St Helier
Jersey JE2 3RR
100%
Lloyds Securities Inc. The Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington
Delaware 19801
100%
2
1 10,000 US Dollars No par value.
2 10 US Dollars 0.1% common.
Alternative performance measure
The statutory results are supplemented with an alternative performance measure that is used internally in LBCM’s monthly
management reporting. The below metric is used through the banking industry. The metric is not necessarily comparable
to similarly titled measures presented by other companies and is not any more authoritative than measures presented in
the financial statements, however management believes that it is useful in assessing the performance of LBCM and in
drawing comparisons between years. A description is given below.
Return on tangible
equity
Profit attributable to ordinary shareholders, divided by average tangible net assets. This
measure is useful in providing a consistent basis with which to measure LBCM’s performance.
Other information
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
72
129Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
Other informationStrategic report Governance Financial statements
Forward-looking statements
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 the
business, strategy, plans and/or results of Lloyds Bank Corporate Markets plc together with its subsidiaries (the Group)
and its current goals and expectations. Statements that are not historical or current facts, including statements about
the Group’s or its directors’ and/or management’s beliefs and expectations, are forward-looking statements.
Words such as, without limitation, ‘believes’, ‘achieves’, ‘anticipates’, ‘estimates’, ‘expects’, ‘targets’, ‘should’, ‘intends’,
‘aims’, ‘projects’, ‘plans’, ‘potential’, ‘will’, ‘would’, ‘could’, ‘considered’, ‘likely’, ‘may’, ‘seek’, ‘estimate’, ‘probability’, ‘goal’,
‘objective’, ‘deliver’, ‘endeavour’, ‘prospects’, ‘optimistic’ and similar expressions or variations on these expressions are
intended to identify forward-looking statements.
These statements concern or may affect future matters, including but not limited to: projections or expectations of the
Group’s future financial position, including profit attributable to shareholders, provisions, economic profit, dividends,
capital structure, portfolios, net interest margin, capital ratios, liquidity, risk-weighted assets (RWAs), expenditures or any
other financial items or ratios; litigation, regulatory and governmental investigations; the Group’s future financial
performance; the level and extent of future impairments and write-downs; the Group’s ESG targets and/or
commitments; statements of plans, objectives or goals of the Group or its management and other statements that are
not historical fact and statements of assumptions underlying such statements.
By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon
circumstances that will or may occur in the future.
Factors that could cause actual business, strategy, targets, plans and/or results (including but not limited to the payment
of dividends) to differ materially from forward-looking statements include, but are not limited to: general economic and
business conditions in the UK and internationally (including in relation to tariffs); acts of hostility or terrorism and
responses to those acts, or other such events; geopolitical unpredictability; the war between Russia and Ukraine; the
conflicts in the Middle East; the tensions between China and Taiwan; political instability including as a result of any UK
general election; market related risks, trends and developments; changes in client and consumer behaviour and demand;
exposure to counterparty risk; the impact of any regulatory and/or legislative divergence between the UK and EU as a
result of the exit by the UK from the European Union (EU) and the effects of the EU-UK Trade and Cooperation
Agreement; the ability to access sufficient sources of capital, liquidity and funding when required; changes to the Group’s
credit ratings; fluctuations in interest rates, inflation, exchange rates, stock markets and currencies; volatility in credit
markets; volatility in the price of the Group’s securities; natural pandemic and other disasters; risks concerning borrower
and counterparty credit quality; risks affecting defined benefit pension schemes; changes in laws, regulations, practices
and accounting standards or taxation; changes to regulatory capital or liquidity requirements and similar contingencies;
the policies and actions of governmental or regulatory authorities or courts together with any resulting impact on the
future structure of the Group; risks associated with the Group’s compliance with a wide range of laws and regulations;
assessment related to resolution planning requirements; risks related to regulatory actions which may be taken in the
event of a bank or Group failure; exposure to legal, regulatory or competition proceedings, investigations or complaints;
failure to comply with anti-money laundering, counter terrorist financing, anti-bribery and sanctions regulations; failure to
prevent or detect any illegal or improper activities; operational risks including risks as a result of the failure of third party
suppliers; conduct risk; technological changes and risks to the security of IT and operational infrastructure, systems, data
and information resulting from increased threat of cyber and other attacks; technological failure; inadequate or failed
internal or external processes or systems; risks relating to ESG matters, such as climate change (and achieving climate
change ambitions) and decarbonisation, including the Group’s ability along with the government and other stakeholders
to measure, manage and mitigate the impacts of climate change effectively, and human rights issues; the impact of
competitive conditions; failure to attract, retain and develop high calibre talent; the ability to achieve strategic
objectives; the ability to derive cost savings and other benefits including, but without limitation, as a result of any
acquisitions, disposals and other strategic transactions; inability to capture accurately the expected value from
acquisitions; and assumptions and estimates that form the basis of the Group’s financial statements. A number of these
influences and factors are beyond the Group’s control. Please refer to Base Prospectus for the Group’s Euro Medium-
Term Note Programme and the latest Annual Report on Form 20-F filed by Lloyds Banking Group plc with the US
Securities and Exchange Commission (the SEC), which is available on the SEC’s website at www.sec.gov, for a discussion
of certain factors and risks. Lloyds Banking Group plc may also make or disclose written and/or oral forward-looking
statements in other written materials and in oral statements made by the directors, officers or employees of Lloyds
Banking Group plc to third parties, including financial analysts.
Except as required by any applicable law or regulation, the forward-looking statements contained in this document are
made as of today’s date, and the Group expressly disclaims any obligation or undertaking to release publicly any updates
or revisions to any forward-looking statements contained in this document whether as a result of new information, future
events or otherwise. The information, statements and opinions contained in this document do not constitute a public
offer under any applicable law or an offer to sell any securities or financial instruments or any advice or recommendation
with respect to such securities or financial instruments.
Other information continued
Lloyds Bank Corporate Markets plc Annual Report and Accounts 2024
73
Non-ring-fenced bank
Head office
10 Gresham Street
London EC2V 7AE
www.lloydsbankinggroup.com
Registered office
25 Gresham Street
London EC2V 7HN
Registered in England no. 10399850