Halifax:The Group’s challenger brandDavid Nicholson

Group Director, Halifax Community Bank

25 April 2012

Becoming the best bank for customers

Our Lloyds Banking Group strategy: • Strengthening our balance sheet

• Paying back the taxpayer• Reshaping our portfolio

• Verde • Focus on core business

• Simplifying the Group• Operations and processes• Getting it right first time

• Investing for future growth• Commitment to branches and multi-brand... And Bancassurance• Investing in colleagues and communities

“With over 30 million customers, we are uniquely placed to unlock the

potential of families, businesses and the communities we serve, making a significant contribution to the future strength and prosperity of the UK.”

A key role in our multi-brand strategy

Halifax: The Group’s Challenger Brand

Re-invigorated the brand –

“the people who give you extra”

Rewarding, great value products

Keeping it simple and straightforward

Upbeat, friendly and professional colleagues

2011: the Group is already delivering

• We’re now in a significantly stronger financial position

• We’ve strengthened our balance sheet

• We’ve significantly improved our capital and liquidity positions

• We’ve exceeded our SME lending and complaints reduction targets

2011: Halifax – a great big beast!

• Group - £3.5bn loss, largely due to PPI provision

• Retail profit - £3.6bn… and Halifax delivered a significant part of that profit

• 2.9m main bankers… 120,000 growth in 2011

• No.1 choice for savers… savings balances £7bn growth in 2011

• Direct mortgage growth at 8% in 2011 in a flat market … we helped 23,000 customers buy a home through Halifax

• Complaints reduced by a third in Halifax Community Bank

• All while integrating!

Halifax: Our bulging trophy cabinet

Rewards Clarity Credit Card

The bank that most rewards loyalty

Best Overall Lender

Best Cash ISA Provider

Best Current Account

Best Fixed Rate Mortgage

Best Cash ISA Provider

Best Fixed Rate Account Provider

Best Current Account Provider (credit interest)

Best Current Account

Best Student Account

Best Customer Service

Switching

We’re getting the message across

December saw Halifax receive more positive press coverage than any other bank thanks to our savers’ prize draw

January – 287 mentions worth £2.5m… great reviews for our switching campaign… and 144 best buys!

March – more positive coverage for Halifax ISAs than any other bank

Best bank for customers in 2012

• Halifax no1 for switchers! Most successful campaign in six years

• General Insurance ‘Fixed Premiums’ proposition

• Savings balances up £574m in Q1 - 750,000 Savers Prize Draw registrations

• Tax year end – more prize draw, extended opening, record service scores

• Mortgages – home buying expertise and first time buyer support

• Multi-channel – unique apps, including Halifax Home Finder

Keeping up the momentum in 2012

• £1.7bn savings from our Group Simplification programme – reinvesting a third

• We’re investing over £100m in 2012 for Halifax customers

• 100 fixes already delivered since migration… loads more to come

– ISA transfers and redesignations… complaints down by 62% per 1,000

– More counter system improvements to speed up transactions

– Fully automated process for Term Deposit Maturities

– Simplified account closures

• Pilot of extended Saturday opening hours

• Multi-channel is key: significant growth of online users… 29,000 signed up in Q1

• New-look branches to support the challenger brand and self-service

Upbeat, friendly and professional

We’re building the most professionally qualified workforce in the industry

• Branch Managers• Financial Advisers• Mortgage Advisers• Banking Advisers – 67 already accredited

All professional by end of 2012

Clear commitments

• Fastest growing UK bank for main banking

• Number one on the high street for mortgages and savings

• Fastest growing multi-channel bank

• Bancassurance growth