Re Agreement

Rolls-Royce PLC
6 February 2001


ROLLS-ROYCE INSURES ASSET RISK

Rolls-Royce today announced that it had entered into an innovative insurance
agreement to reduce the group's exposure to asset-based customer financing
risk.

In civil aerospace markets, manufacturers will, from time to time, guarantee a
portion of the future value of aircraft powered by their engines.  This
assists customers in financing the purchase of products. 

Paul Heiden, Finance Director, Rolls-Royce, said:

'Rolls-Royce has a strong track record in managing the risks associated with
asset value guarantees. Over the past decade, the company has achieved
considerable market success, which has led to a growing requirement for such
guarantees. Recent developments in financial markets enable the company to
insure against the remote possibility of losses on such obligations. 

'We regard this transaction as a prudent step, which is consistent with the
increasing focus we are placing on operational risk management.  It will
strengthen the company's capability to provide competitive financing solutions
for customers in the future.'

The transaction, originated by XL Financial Solutions Ltd, a subsidiary of XL
Capital Ltd, reduces the company's gross exposure to asset value guarantees
associated with a portfolio of Trent-powered Boeing and Airbus Industrie
aircraft. The RISConsulting Group LLC acted as technical advisor on the
transaction.


For further information please contact:
Peter Barnes-Wallis
Director - Financial Communications
Rolls-Royce plc
Phone:     [phone]
Fax:       [phone]
Email:     [e-mail]