Redress for Past Purchasers of Pension Policies
Lloyds TSB Group PLC
22 November 1999
PROVISION FOR REDRESS TO PAST PURCHASERS OF PENSION POLICIES
The Financial Services Authority (FSA) has published revised assumptions which
now need to be incorporated into the calculations of the continuing costs of
redress to past purchasers of pension policies. Lloyds TSB currently has a
total provision for this purpose of £700 million and, as at 31 October 1999,
£388 million of this provision had been used to settle cases.
The revised FSA guidelines are based on the assumption that the average life
expectancy of pensioners has increased, and lower interest and inflation rates
are now to be assumed in calculating the cost of redress.
Applying these revised assumptions the cost of redress is forecast to increase
by £102 million. Accordingly, the board has agreed that a provision of that
amount will be included in the profit and loss account of the Lloyds TSB Group
for the year ending 31 December 1999.
For more information
Lloyds TSB Press Office
0171 626 1500
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