Third party distributor Q&A.:

Third party distributor Q&A.: Lloyds sells Insight fund business for £235m August 12 2009 09:53. Lloyds is to sell its Insight asset management business to Bank of New York Mellon for £235m, while transferring some of the Insight funds to a beefed up Scottish Widows, it announced on Wednesday. The deal will see Bank of New York Mellon receive Insight’s external fund management operation, with assets of £80bn spread across pension schemes, third party distributors and intermediaries. The £235m price tag for the business will be split between £200m in cash and the remainder in equity. Meanwhile, Lloyds’ Scottish Widows investment management business will take over the HBOS bancassurance businesses, the Clerical Medical intermediary franchise, and the Bank of Scotland wealth management operation, the funds of all of which are presently managed by Insight. The changes will increase funds under management at Scottish Widows by more than 50 per cent from £83bn to approximately £125bn. Based in Edinburgh, Scottish Widows will become a ‘centre of excellence’ for Lloyds’ asset management business. “As Lloyds Banking Group continues to develop and grow, both in the UK and internationally, it was essential that we undertook a thorough and robust review of our asset management businesses and future plans,” said Jo Dawson, wealth and international director at Lloyds. “Both Scottish Widows and Insight are strong and well established asset managers but we believe Insight is better able to focus on developing its specialist external franchise outside the group. Scottish Widows has been managing funds successfully for Lloyds TSB customers since 2000 as well as for a growing range of alliances, joint ventures and clients both in the UK and abroad. By positioning Scottish Widows as a centre of excellence for the group’s asset management activity we will create strong and sustainable value for our clients and shareholders.” The disposal and reorganisation comes after Lloyds last week reported better than expected results and suggested the possibility of a renegotiation of the terms under which it participates in the government’s asset protection scheme, which insures the bank’s bad loans. However, the bank’s embyonic plans to raise between £15bn and £20bn in a rights issue to reduce its reliance on the asset protection scheme met with scepticism from investors and the government. Shares in Lloyds fell 2.2 per cent or 2p to 89.01p in morning trading.

Whitehall wary over Lloyds’ £15bn plan August 10 2009 23:31. Lloyds Banking Group’s tentative plans to raise an estimated £15bn-£20bn ($25bn-$33bn) in a rights issue to reduce its reliance on the government face a wall of scepticism in Whitehall and among investors. Lloyds last week floated the idea that the terms of its participation in the government’s asset protection scheme (APS) might be open to renegotiation after second-quarter results that were more upbeat than expected. “No one is pushing a line on this,” one person close to Lloyds said on Monday. “We’re just suggesting that maybe there’s a different deal to be done.” But the bank faces an uphill task in convincing Alistair Darling, the chancellor, to revisit the basic terms of the scheme after months of complex negotiations. Under the APS, launched early this year, the government agreed to underwrite banks’ bad loans in return for a fee. Mr Darling sees the APS as an international model for cleaning up toxic assets and his team is sceptical that raising sufficient capital to sidestep the scheme would be wise, feasible or sufficient to satisfy regulators. Bankers point out that even if the government could be persuaded to amend the terms of Lloyds’ participation, it would face another unpleasant dilemma – either buying into a rights issue at a cost of up to £9bn, according to analyst estimates, or seeing its 43 per cent stake diluted. Lloyds last week took a further £13.4bn of bad loan charges in the first half of 2009, on top of a £12.4bn tally at the end of last year. But it said impairments had peaked and would be “significantly lower” in the second half, pushing the bank’s shares to a seven-month high. Talk of a £15bn rights issue reversed that trend and left the shares down 4 per cent at 97.89p on Monday. It is unclear in what way Lloyds would like to renegotiate the APS, though one person briefed on the plan said changes could theoretically relate to the £15.6bn share-based premium to be levied for the insurance, as well as to its overall size of £260bn. A partial reduction in either, topped up by rights issue funding, was a possibility. However, the person added: “We wouldn’t expect the broad scope of the [asset protection] scheme to change.” Officially, the bank declined to elaborate on a weekend statement that it was working with the Treasury on the fine print of the scheme and expected to conclude a deal that was “in the best interests of our shareholders”. People familiar with the APS talks insist they are proceeding on schedule, with details set to be finalised by the end of next month. Analysts at Credit Suisse estimated on Monday that Lloyds would need to raise £15bn-£20bn in a rights issue to make up the capital shortfall left by withdrawing from the APS.

Asset protection scheme: 26/02/2009 21:19. Part-nationalised RBS will use the Government's newly-created Asset Protection Scheme to strengthen its finances. What is the Asset Protection Scheme? The APS allows struggling banks to access - in return for a fee - Government insurance against future losses on toxic "assets" hit by the downturn. It will run for at least five years. Why is it being introduced? The Government hopes that the measure will boost lending by reducing banks' uncertainty about the value of past investments - especially the complex financial instruments hit by the credit crunch. This should give the banks greater confidence to lend in the future to creditworthy businesses, homeowners and consumers. Mr Darling said in January: "The banks' problems stem from uncertainty about the value of their assets - faced with this uncertainty, individual banks are reluctant to lend to businesses and companies. "This will reduce the banks' exposure to risks and give them the room they need in order to lend more." Who is eligible and what assets are being insured? Qualifying assets include commercial and residential property loans worst hit by the downturn, as well as some types of asset-backed bonds and corporate loans. Any UK bank with more than £25 billion in eligible assets can apply for the scheme until the end of March. How does it work? The Treasury will give the bank protection against future losses on their toxic assets beyond the extent of a "first loss" - like the excess on a normal insurance policy - agreed with the institution. The bank will also retain a further residual exposure of 10% of the losses exceeding the "first loss" amount - giving an incentive for the banks to keep losses to a minimum going forward. How much is the taxpayer exposed? Royal Bank of Scotland intends to put £325 billion worth of assets into the scheme, while Lloyds is also likely to announce its participation on Friday. RBS is liable for the first £19.5 billion of losses, but the taxpayer is theoretically exposed to 90% of all losses after the "first loss" amount - although this assumes that all the assets placed in the scheme become worthless. How much will it cost the banks? The fee charged to the banks and the setting of the "first loss" amount will depend on the assets being insured. Participants are likely to pay a percentage fee based on the value of the assets being insured - but because the amount likely to be put into the scheme, banks are unlikely to pay in cash. RBS is issuing £6.5 billion in B shares to the Government to pay for taking part - 2% of the value of the assets being insured - under its initial agreement. Lloyds is likely to give an indication of its own terms on Friday. What other strings are attached? The Treasury is demanding that banks prove their businesses are sustainable and want a "verifiable commitment" to support lending to creditworthy borrowers in a commercial manner. RBS has announced plans to boost lending by £25 billion this year - £9 billion in mortgages and £16 billion for business customers. It has pledged to lend a similar amount in 2010. Given the recent row over bonuses and rewards for failure, the banks' remuneration policies should also comply with the Financial Services Authority's code of practice, which aims to ensure pay structures "consistent with sound risk management, and which do not expose them to excessive risk". Who controls the assets? Assets included in the scheme will continue to be managed by banks and remain on their balance sheets but will be required to be "ring-fenced" so that actions in relation to them are subject to Treasury controls. The Treasury can also take over ownership or management of the assets in "certain defined circumstances". What other public sector support is there for the banking sector? 1. : Direct support through recapitalization with £37 billion spent on RBS and Lloyds so far. : The Government is setting up a guarantee scheme for mortgage-backed securities aimed at getting home loans going again. These were a major source of funding for mortgages before they dried up with the credit crunch. 1.: The Treasury has also extended its guarantees on debt issued by banks, as well as the Bank of England's special liquidity scheme - which allows banks to swap riskier assets for safer Treasury bonds. 1. : £10 billion working capital scheme, securing up to £20 billion of short-term bank lending to companies with a turnover of up to £500 million. 1. : An enterprise finance guarantee scheme, securing up to £1.3 billion of additional bank loans to small firms with a turnover of up to £25 million. 1. : A £75 million capital for enterprise fund (£50 million from Government and £25 million from banks) to invest in small businesses which need equity.

Hunt for pirates after ship disappears from UK waters. Maritime officials mystified over location of cargo vessel Arctic Sea amid reports of boarding by armed party. Speculation continues about the fate of missing vessel the Arctic Sea, feared taken in Europe's first significant case of maritime piracy in living memory after it was reportedly boarded by an armed group. Theories include the ship being given a false identity to steal other vessels' cargos, or that Russian gangsters are using it to smuggled illegal arms. But an expert has suggested it may have been seized as part of a commercial dispute. The 98-metre Russian-crewed cargo ship set off from Finland on 23 July carrying timber worth about £1m and bound for the Algerian port of Bejaia. In the early hours of the next morning, in the Baltic Sea near the Swedish island of Oland, the ship was boarded by up to 10 armed men dressed in police uniforms, according to reports from the Russian news agency Tass. The raiders tied up the crew as they searched the vessel and stole a few items, including a satellite phone, before leaving in their rubber dinghy. Three crew members were reportedly injured. The attack does not seem to have been reported immediately and only emerged 10 days later when Interpol issued an alert. By this time the Maltese-registered ship had vanished. Its last confirmed contact with the outside world came just before 3pm British time on 29 July, when it radioed the British coastguard to say it was in the Dover straits and heading for Algeria. Signals from the ship's automatic identification system (AIS) beacon confirmed the position. The communication raised no suspicions, but within hours an international police appeal was relayed to the coastguard suggesting the ship may have been hijacked. Mark Clark, of the Maritime and Coastguard agency, said: "It is possible that the person who spoke was either a pirate or a member of the crew speaking under duress." Alternative theories have sprung up, including the notion that criminal gangs or someone connected to the crew had been smuggling drugs or another illegal consignment amid the timber. Russian maritime officials have dismissed any notion of crew complicity, saying those on board were experienced and trusted. Nick Davis, the chief executive of the Merchant Maritime Warfare Centre, told BBC Radio 4's Today programme: "It's not carrying a valuable cargo ... [a] small [amount of] timber between the Baltic states and Algiers is not a high-value cargo, so I strongly suspect that this is probably a commercial dispute between its owner and a third party, and they have decided to take matters into their own hands." According to websites that monitor live AIS signals, the Arctic Sea, built in 1992 and owned by a Finnish company, disappeared from tracking systems in the early hours of 30 July off the northern French port of Brest. This does not necessarily mean the system was turned off, as tracking coverage can be patchy. The ship was later spotted by a patrol aircraft off the Portuguese coast, Clark said. And then, nothing – the ship and its crew seemingly disappeared into thin air. The vessel was due at Bejaia more than a week ago but never arrived. Spanish reports say it was never seen passing the Straits of Gibraltar, meaning it could have been taken down the west coast of Africa. "I would strongly feel that the vessel is now down off the west coast of Africa, somewhere even further down towards the Nigeria way and the vessel will probably be renamed, repainted and the crew sort of dropped off at a port somewhere, probably safe and well, to then sort of hand themselves in and say 'We were the crew of this vessel and we want to go home'," said Davis. The Russian navy has sent ships from its Black Sea fleet to the Atlantic to hunt for the Arctic Sea, according to the country's defence ministry, while Portugal is carrying out its own search. "We don't know what has happened but it is possible the ship was attacked by pirates," said a spokesman at the Maritime Rescue Co-ordination Centre in Lisbon. "We are searching with planes and boats, but so far there is no sign of it." If the case does turn out to be piracy, it would be an unprecedented situation, according to Jeremy Harrison, from the UK's Chamber of Shipping. "It's extraordinary. This just doesn't happen. These are heavily patrolled waters," he said. If boarders had turned off the AIS signal, finding the vessel could prove hard, Harrison said. "It can take a long time even to find boats in trouble, even when the general location is known. If the vessel is still afloat and is trying to hide – well, it's a big ocean."

London Buses: Issued subject to conditions, see over. NEW OXFORD STREET C204. SINGLE JOURNEY. VALID UNTIL 13:29 06 AUG 09. £2.00. 12:29 090806. Together with e-mail from PCS, From: Stuart Jones (pcs@pcsexecutive.cccampaigns.net) Sent: 07 August 2009 14:31:14. To: Viktor Antonovitch Glugovsky (glugovskyviktor@hotmail.com). A BNB Recruitment Solutions Plc Company. (“…MEXICAN PRESIDENT FELIPE CALDERON (THROUGH TRANSLATOR): Right Honorable Mr. Stephen Harper, prime minister of Canada, Right Honorable Mr. Barack Obama, president of the United States of America, ladies and gentlemen, representatives of the media, national as well as international, the leaders from the United States, Canada, and Mexico have completed two fruitful workdays for the benefit of our nationals (ph)…”)