Lloyds Regulatory News (LLOY)

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LLOYDS BANKING GROUP PLC ("LBG") ANNOUNCES FINAL RESULTS OF ITS INVITATIONS TO EXCHANGE THE STERLING DENOMINATED SUBORDINATED SECURITIES LISTED BELOW (THE "EXISTING NOTES") FOR A COMBINATION OF (I) A SINGLE SERIES OF NEW STERLING DENOMINATED SUBORDINATED NOTES (THE "NEW TIER 2 NOTES") TO BE ISSUED BY LBG AND (II) ANY APPLICABLE CASH CONSIDERATION AMOUNT

 25 November 2020

Further to its announcements on 16 November 2020 and 25 November 2020, Lloyds Banking Group plc (the "Offeror") is today announcing the final results of its invitations to all Holders (subject to the Offer Restrictions referred to below) of:

· the Existing Tier 1 Notes, set out under the heading "Existing Tier 1 Notes" below, to Offer to Exchange such Existing Tier 1 Notes which are outstanding; and

· the Existing Tier 2 Notes, set out under the heading "Existing Tier 2 Notes" below, to Offer to Exchange such Existing Tier 2 Notes which are outstanding,

together, the "Exchange Offers" and each an "Exchange Offer".

The Exchange Offers were made on the terms of and subject to the conditions contained in an exchange offer memorandum dated 16 November 2020 (the "Exchange Offer Memorandum"). Capitalised terms not otherwise defined in this announcement have the same meaning as assigned to them in the Exchange Offer Memorandum.

RESULTS OF THE EXCHANGE OFFERS

The Minimum New Issue Size Condition has been satisfied.

For the Offer to Exchange the Existing Tier 1 Notes, the aggregate principal amount accepted for exchange is £825,655,000.

For the Offer to Exchange the Existing Tier 2 Notes, the aggregate principal amount accepted for exchange is £207,535,000.

All valid Offers to Exchange Existing Tier 1 Notes in the Exchange Offers have been accepted in full without pro-ration. The Tier 2 Notes Acceptance Amount is £207,535,000.

All valid Offers to Exchange the 2023 Notes have been accepted in full without pro-ration. The Offeror has not accepted any Offers to Exchange in respect of the £750,000,000 7.625 per cent. Dated Subordinated Notes due 22 April 2025 (XS0503834821) issued by Lloyds Bank plc.

The Existing Notes set out in the table below shall be exchanged for New Tier 2 Notes as further described below.

*Including both the consideration in the form of New Tier 2 Notes and the Cash Consideration Amount (where applicable)

The New Tier 2 Notes

The table below confirms certain key characteristics of the New Tier 2 Notes to be issued by LBG pursuant to the Exchange Offers. Further details of the New Tier 2 Notes will be set out in the New Tier 2 Notes Final Terms which will be published on the Settlement Date (the form of which is set out in the Exchange Offer Memorandum). The New Tier 2 Notes ISIN is XS2265524640.

The New Tier 2 Notes will be in bearer form in denominations of £100,000 and integral multiples of £1,000 in excess thereof up to and including £199,000, and will initially be issued in global form.

Applications are intended to be made to the Financial Conduct Authority under Part VI of the Financial Services and Markets Act 2000 for the New Tier 2 Notes to be admitted to the Official List of the Financial Conduct Authority and to the London Stock Exchange plc for the New Tier 2 Notes to be admitted to trading on the London Stock Exchange's regulated market. The London Stock Exchange's regulated market is a regulated market for the purposes of Directive 2014/65/EU of the European Parliament and of the Council on markets in financial instruments. Such admission is expected to occur on the Settlement Date.

Further details of the New Tier 2 Notes are set out in the Exchange Offer Memorandum.

Holders whose Existing Notes Offered for Exchange are not accepted, or who do not participate in the Exchange Offers, will not be eligible to receive New Tier 2 Notes in exchange for such Existing Notes, will not be entitled to receive any Cash Consideration Amount and will continue to hold such Existing Notes subject to their terms and conditions.

Exchange Consideration, New Tier 2 Notes Consideration Amounts and Cash Consideration Amounts

Holders who validly Offered to Exchange their Existing Notes at or prior to the Expiration Time and whose Offers to Exchange have been accepted will receive New Tier 2 Notes in an amount (rounded down to the nearest £1,000) based upon the aggregate principal amount of such Existing Notes accepted for exchange and the relevant New Tier 2 Notes Consideration Amount, subject to the requirement for each Holder to exchange at least the relevant Minimum Offer Amount.

Where applicable, each such Holder will also be entitled to receive, in respect of each £1,000 in principal amount of the Existing Notes accepted for exchange, the Cash Consideration Amount (if any). For avoidance of doubt, the sum of the New Tier 2 Notes Consideration Amount, the Cash Consideration Amount (if any) and the Cash Rounding Amount (if any, as detailed below) shall be equal to the Exchange Consideration when expressed as an amount per £1,000 in principal amount of the Existing Notes accepted for exchange.

Accrued Interest Payments and Cash Rounding Amounts

If, as a result of the application of the relevant New Tier 2 Notes Consideration Amount, a Holder who validly Offered to Exchange Existing Notes at or prior to the Expiration Time and whose Offer to Exchange has been accepted would be entitled to receive an aggregate principal amount of New Tier 2 Notes that is not an integral multiple of £1,000, the Offeror will pay, or procure that there is paid, in cash in sterling to that Holder on the Settlement Date, a Cash Rounding Amount, which is the amount equal to the fractional portion of such aggregate principal amount that is not such an integral multiple (rounded to the nearest £0.01, with half a penny being rounded upwards).

Each such Holder will also be entitled to receive any applicable Accrued Interest Payments in respect of their Existing Notes accepted for exchange. Accordingly, given that the Accrued Interest Payments will be paid pursuant to the relevant Exchange Offer, Holders whose Existing Notes have been accepted for exchange pursuant to the Exchange Offers will not be entitled to receive any further payment pursuant to the terms of such Existing Notes in respect of accrued and unpaid interest. Furthermore, Holders of any Lloyds Bank Perpetual Securities which have been accepted for exchange will not be entitled to receive any further payment, shares or other compensation in respect of any deferred and unpaid coupons in respect of such Lloyds Bank Perpetual Securities; consideration for deferred and unpaid coupons is deemed to be included in the applicable Exchange Consideration.

Settlement Date

The Settlement Date for each of the Exchange Offers, including (i) delivery of the New Tier 2 Notes in exchange for Existing Notes validly Offered for Exchange and accepted and (ii) payment of Accrued Interest Payments, Cash Rounding Amounts (if any) and Cash Consideration Amounts (if any), is expected to be on or around 3 December 2020.

This announcement contains inside information in relation to the Existing Notes and is disclosed in accordance with the Market Abuse Regulation (EU) 596/2014 ("MAR"). For the purposes of MAR, this announcement is made by Douglas Radcliffe, Group Investor Relations Director.

FURTHER INFORMATION

For further information please contact:

Investor Relations:

Douglas RadcliffeGroup Investor Relations DirectorTelephone: +44 (0)20 7356 1571Email: Douglas.Radcliffe@LloydsBanking.com

Corporate Affairs:

Matthew SmithHead of Media RelationsTel: +44 (0) 20 7356 3522Email: matt.smith@lloydsbanking.com

Requests for information in relation to the Exchange Offers should be directed to:

GLOBAL CO-ORDINATOR & JOINT DEALER MANAGER

JOINT DEALER MANAGERS

Requests for information in relation to, and for any documents or materials relating to, the Exchange Offers should be directed to:

DISCLAIMER

This announcement must be read in conjunction with the Exchange Offer Memorandum and the announcements in connection with the Exchange Offers published via RNS on 16 November 2020 and 25 November 2020. None of the Offeror, the Joint Dealer Managers, the Exchange Agent and any person who controls, or is a director, officer, employee or agent of such persons, or any affiliate of such persons, makes any recommendation in connection with the Exchange Offers.

This announcement does not constitute an offer or an invitation to participate in the Exchange Offers in the United States or in any other jurisdiction in which, or to any person to or from whom, it is unlawful to make such offer or invitation or for there to be such participation under applicable laws.