Trading Statement

Lloyds TSB Group PLC
21 June 2004


103/04
                                                     21 June 2004

LLOYDS TSB - TRADING UPDATE

Lloyds TSB Group plc will shortly be meeting analysts ahead of its close period
for the half-year ending 30 June 2004.  This announcement details the
information that will be provided at those meetings.

Good progress continues to be made in repositioning the Group for growth and
Lloyds TSB expects to deliver a satisfactory trading performance for the
half-year.

The Group has continued to deliver good levels of balance sheet growth.  At 31
March 2004 total Group loans and advances to customers were £137.8 billion, an
increase of 9 per cent, on a continuing businesses basis, over the last 12
months.  On the same basis, customer deposits increased by 3 per cent to £116.7
billion.  The Group net interest margin for the first three months of 2004 was
2.97 per cent compared with a Group net interest margin, on a continuing
operations basis, of 2.92 per cent in the first half of 2003, and 3.03 per cent
in the second half of 2003.  Total Group risk-weighted assets at 31 March 2004
were £119.3 billion, an increase of 1 per cent during the quarter, as growth in
customer loans and advances, particularly in mortgages, was partly offset by a
reduction in debt securities.

                                                                        .../more


LLOYDS TSB - TRADING UPDATE .../2

Retail Banking and Mortgages has continued to make progress in profitable
franchise development, notwithstanding some slowdown in the demand for consumer
credit.  The retail bank has continued to maintain and grow market share in its
core markets, particularly in mortgage and credit card lending, albeit with some
expected margin erosion.  Mortgage balances outstanding at 31 March 2004
totalled £73.4 billion, an increase of 13 per cent over the last 12 months.  Net
new mortgage lending in the first quarter of 2004 was £2.6 billion, compared
with £2.2 billion in the first quarter of 2003.  Personal loan and credit card
lending increased by 12 per cent compared to the first quarter of 2003,
excluding the impact of the Goldfish acquisition, and by 3 per cent since 31
December 2003.  Balances on current accounts and savings and investment accounts
grew by 9 per cent compared to the first quarter of 2003.

Scottish Widows has continued to change its product mix to focus on more
profitable and capital efficient products.  Overall weighted sales of life and
pension products in the first quarter of 2004, at £136.5 million, were broadly
in line with the first quarter of 2003.  Unit trust sales fell to £21.9 million,
compared to £33.5 million in the first quarter of 2003, as the market for
regular premium equity based savings products continues to be subdued.  Scottish
Widows is strongly capitalised and remains on track to pay a 2004 dividend to
Lloyds TSB.

In Wholesale Banking very good progress continues to be made in developing the
overall franchise by extending and deepening relationships with our existing
corporate customers.  As a result, all businesses within the division have
performed well and we have achieved a good increase in new business volumes.
Overall balance sheet efficiency continues to improve with a 6 per cent
reduction in fine margin debt securities during the first quarter of 2004 whilst
risk-weighted assets were broadly unchanged.

Total Group asset quality remains satisfactory, with no material increase in the
level of non-performing lending.  The annualised charge for bad and doubtful
debts in the first quarter of 2004, as a percentage of average lending, was
broadly similar to the 0.66 per cent reported for the full year 2003.

                                                                        .../more


LLOYDS TSB - TRADING UPDATE .../3

In the first five months of 2004 there was a negative investment variance
totalling £97 million, largely as a result of lower gilt values and the slight
fall in the FTSE All Share Index during the period.

Eric Daniels, Group Chief Executive, said "We are continuing to make good
progress in our key priority to reposition the Group for sustainable growth and
we remain well positioned to deliver our planned improved performance in the
second half of 2004 and beyond".

The Group's results for the half-year ending 30 June 2004 will be announced on
30 July 2004.  No changes in accounting policies are expected in the first half
of 2004.  The attached appendix provides detailed half-year comparative figures
for 2003 which reflect changes in the Group's segmental analysis to reflect the
introduction, in 2004, of the management of the Group's distribution channels as
profit centres, and other changes in internal pricing arrangements.


For further information:-

Investor Relations
Michael Oliver                                           [phone]
Director of Investor Relations
E-mail: [e-mail]

Ian Gordon                                               [phone]
Senior Manager, Investor Relations
E-mail: [e-mail]

Media
Terrence Collis                                          [phone]
Director of Group Corporate Communications
E-mail: [e-mail]

Mary Walsh                                               [phone]
Head of Media Relations
E-mail: [e-mail]


                                                                        .../more


LLOYDS TSB - TRADING UPDATE .../4


                           FORWARD LOOKING STATEMENTS

This announcement contains forward looking statements with respect to the
business, strategy and plans of the Lloyds TSB Group and its current goals and
expectations relating to its future financial condition and performance.
Statements that are not historical facts, including statements about Lloyds TSB
Group's or management's beliefs and expectations, are forward looking
statements.  By their nature, forward looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that will
occur in the future.  Lloyds TSB Group's actual future results may differ
materially from the results expressed or implied in these forward looking
statements as a result of a variety of factors, including UK domestic and global
economic and business conditions, risks concerning borrower credit quality,
market related risks such as interest rate risk and exchange rate risk in its
banking businesses and equity risk in its insurance businesses, inherent risks
regarding changing demographic developments, catastrophic weather and similar
contingencies outside Lloyds TSB Group's control, any adverse experience in
inherent operational risks, any unexpected developments in regulation or
regulatory actions, changes in customer preferences, competition, industry
consolidation, acquisitions and other factors.  For more information on these
and other factors, please refer to Lloyds TSB Group's Annual Report on Form 20-F
filed with the US Securities and Exchange Commission and to any subsequent
reports furnished by Lloyds TSB Group to the US Securities and Exchange
Commission or to the London Stock Exchange.  The forward looking statements
contained in this announcement are made as of the date hereof, and Lloyds TSB
Group undertakes no obligation to update any of its forward looking statements.


                                                                        .../more


LLOYDS TSB - TRADING UPDATE .../5

LLOYDS TSB GROUP

                                                SEGMENTAL ANALYSIS


  Half-year ended          UK Retail                   Wholesale     
   30 June 2003             Banking    Insurance             and     Central  
                                and          and   International       group     Continuing   Discontinued              
                          Mortgages  Investments         Banking       items     operations     operations       Total 
                                 £m           £m              £m          £m             £m             £m          £m
                                                                                   

Net interest income           1,515           39             898        (167)         2,285            286       2,571
Other finance income              -            -               -          17             17              -          17
Other operating income          741          447             750         288          2,226             89       2,315
Total income                  2,256          486           1,648         138          4,528            375       4,903
Operating expenses            1,354          133             991           6          2,484            143       2,627
Trading surplus                 902          353             657         132          2,044            232       2,276
General insurance claims          -          108               -           -            108              -         108
Bad debt provisions             298            -             145         (13)           430             40         470
Amounts written off fixed
asset investments                 -            -              24           -             24              -          24
Income from joint ventures      (11)           -               -           -            (11)             -         (11)
Profit before tax*              593          245             488         145          1,471            192       1,663
Investment variance               -           42               -           -             42              -          42
Changes in economic               -           (8)              -           -             (8)             -          (8)
assumptions
Loss on sale of business          -            -               -           -              -            (15)        (15)
Profit before tax               593          279             488         145          1,505            177       1,682


                                                   
 Half-year ended          UK Retail                    Wholesale     
 31 December 2003           Banking    Insurance             and     Central  
                                and          and   International       group     Continuing   Discontinued              
                          Mortgages  Investments         Banking       items     operations     operations       Total 
                                 £m           £m              £m          £m             £m             £m          £m


Net interest income           1,622           42             977        (182)         2,459            225       2,684
Other finance income              -            -               -          17             17              -          17
Other operating income          792          534             811          11          2,148             53       2,201
Total income                  2,414          576           1,788        (154)         4,624            278       4,902
Operating expenses            1,229          128           1,057           3          2,417            129       2,546
Trading surplus               1,185          448             731        (157)         2,207            149       2,356
General insurance claims          -          128               -           -            128              -         128
Bad debt provisions             296            -             161           -            457             23         480
Amounts written off fixed                                                                                      
asset investments                 -            -              20           -             20              -          20
Income from joint ventures      (11)           -               -           -            (11)             -         (11)
Profit before tax*              878          320             550        (157)         1,591            126       1,717
Investment variance               -           83               -           -             83              -          83
Changes in economic               -          (14)              -           -            (14)             -         (14)
assumptions
Profit on sale of businesses      -            -               -           -              -            880         880
Profit before tax               878          389             550        (157)         1,660          1,006       2,666

* excluding investment variance, changes in economic assumptions and profit
  (loss) on sale of businesses


                      This information is provided by RNS
            The company news service from the London Stock Exchange