SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.20549

                                   FORM 6-K

                        Report of Foreign Private Issuer
                       Pursuant to Rule 13a-16 or 15d-16
                     of the Securities Exchange Act of 1934



                               August 1, 2003


                              LLOYDS TSB GROUP plc
                (Translation of registrant's name into English)


                              71 Lombard Street
                              London EC3P 3BS
                              United Kingdom


                    (Address of principal executive offices)



Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.

                          Form 20-F..X..Form 40-F.....


Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

                               Yes .....No ..X..

If "Yes" is marked, indicate below the file number
assigned to the registrant in connection with Rule
12g3-2(b): 82- ________



                                  Index to Exhibits

Item

No. 1         Regulatory News Service Announcement, dated August 1, 2003
              re:  Interim Results

                              Lloyds TSB Group plc

                           Results for the half-year
                                to 30 June 2003

                            PRESENTATION OF RESULTS

In order to provide a clearer representation of the underlying performance of
the Group, the results of the Group's life and pensions business include
investment earnings calculated using longer-term investment rates of return and
annual management charges based on unsmoothed fund values (page 45, note 5).
The difference between the normalised investment earnings and the actual return
("the investment variance") together with the impact of changes in the economic
assumptions used in the embedded value calculation (page 45, note 6) have been
separately analysed and a reconciliation to the Group's profit before tax is
given on page 1.




                                    CONTENTS
                                                                                                                  Page
                                                                                                                

Profit before tax by main businesses                                                                                 1
Performance highlights and Chairman's comments                                                                       2
Group Chief Executive's statement                                                                                    3
Summary of results                                                                                                   6
Review of financial performance                                                                                      7
Consolidated profit and loss account                                                                                11
Consolidated balance sheet                                                                                          12
Consolidated cash flow statement                                                                                    13
Segmental analysis                                                                                                  14
Performance by sector                                                                                               16
Income                                                                                                              30
Operating expenses                                                                                                  35
Number of employees                                                                                                 36
Credit quality                                                                                                      37
Capital ratios                                                                                                      39
Overview of consolidated balance sheet                                                                              40
Notes                                                                                                               43
Contacts for further information                                                                                    48



                      FORWARD LOOKING STATEMENTS

This announcement contains forward looking statements with respect to the
business, strategy and plans of the Lloyds TSB Group, its current goals and
expectations relating to its future financial condition and performance.  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 business and equity
risk in its insurance businesses, changing demographic trends, unexpected
changes to regulation or regulatory actions, changes in customer preferences,
competition and other factors.  Please refer to the latest Annual Report on Form
20-F of Lloyds TSB Group filed with the US Securities and Exchange Commission
for a discussion of such factors.

LLOYDS TSB GROUP 2003 INTERIM RESULTS

                         PROFIT BEFORE TAX BY MAIN BUSINESSES



                                                                                 Half-year to                Half-year to
                                                                                    30 June                  31 December
                                                                              2003             2002             2002
                                                                              GBPm             GBPm             GBPm
                                                                                                        

UK Retail Banking and Mortgages
  Before provisions for customer redress                                       631              622              619
  Provisions for customer redress                                             (200)               -                -
                                                                               431              622              619
Insurance and Investments
  Before provisions for customer redress                                       589              757              676
  Provisions for customer redress                                             (100)               -             (205)
                                                                               489              757              471
Wholesale Markets                                                              368              354              296
International Banking                                                          235              231              150
Central group items                                                            120               39              (35)
Profit before tax, excluding changes in economic
assumptions and investment variance                                          1,643            2,003            1,501
Changes in economic assumptions (page 45, note 6)                               (8)               -               55
Investment variance (page 45, note 5)                                           42             (399)            (553)
Profit before tax                                                            1,677            1,604            1,003




2002 figures have been restated to incorporate efficiency programme related
restructuring costs within business units, the reclassification of emerging
markets debt earnings from International Banking to Central group items, and
changes in internal transfer pricing arrangements.



                                  Page 1 of 48



LLOYDS TSB GROUP 2003 INTERIM RESULTS

                              PERFORMANCE HIGHLIGHTS

Results

-          Profit before tax increased by GBP73 million, or 5 per cent, to
           GBP1,677 million.

-          Profit attributable to shareholders increased by 4 per cent to
           GBP1,155 million.

-          Earnings per share increased by 4 per cent to 20.7p.

-          Post-tax return on average shareholders' equity 28.1 per cent.

-          Total capital ratio 10.1 per cent, tier 1 capital ratio 8.1 per cent.

-          Interim dividend of 10.7p per share (2002: 10.7p).

-          Over the last twelve months, customer lending grew by 11 per
           cent to GBP142 billion and customer deposits increased by 7 per cent
           to GBP121 billion.

-          The Group has improved its market share in many key product areas,
           including mortgages, credit cards, bank savings, and life, pensions
           and long-term savings.

Results, excluding changes in economic assumptions and investment variance

-          Profit before tax decreased by GBP360 million, or 18 per cent, to
           GBP1,643 million.

-          Excluding a number of other significant items, pre-tax profits are
           broadly unchanged.

-          Profit attributable to shareholders decreased by 20 per cent to
           GBP1,128 million.

-          Earnings per share decreased by 20 per cent to 20.2p.

-          Economic profit decreased by 19 per cent to GBP758 million.

-          Post-tax return on average shareholders' equity 27.4 per cent.

Commenting on the results Lloyds TSB Group chairman, Maarten van den Bergh,
said:-

"Lloyds TSB has reported a 5 per cent growth in pre-tax profits during the first
half of 2003, reflecting a solid underlying performance and, in particular, the
absence of a significant negative investment variance arising from the weakness
in global stock markets, which affected the Group's results in 2002.  The Group
has continued to grow its share of key markets, costs have remained tightly
controlled, and capital ratios remain satisfactory.

The Board is maintaining the interim dividend at 10.7p per share.  The Board
recognises the importance attached by shareholders to the Group's dividend and
will continue to take each dividend decision on its merits at the time, taking
into account the Group's capital position and the Board's view of current
earnings and future prospects.

The Group continues to operate in a challenging economic environment.  However
further progress is expected in the second half of the year."


                                  Page 2 of 48


LLOYDS TSB GROUP

                       GROUP CHIEF EXECUTIVE'S STATEMENT

In the first half of 2003, Lloyds TSB's headline profit before tax increased by
5 per cent, compared with the first half of 2002.  However, a number of
significant items, both favourable and unfavourable, affected this half-year's
profits which, on a like-for-like basis, were broadly unchanged.  On the same
basis, revenues increased by 2 per cent, and costs were held flat.

The economic and regulatory environment in which the Group operates continues to
be challenging but, despite this, Lloyds TSB has improved its market share
performance in a number of key products and delivered good growth in both
customer lending and deposits.  Margin erosion remains a concern, as does the
likely slowdown in UK consumer credit growth and continuing uncertainty in
global stock markets.

Over the past several  periods,  Lloyds TSB's results and financial  performance
have been  characterised by a high return on equity, an increased  volatility in
earnings and modest growth in like-for-like profits. The Group's results for the
first half of 2003 are not  dissimilar,  as higher earnings from the sale of the
Group's emerging markets debt portfolio and the absence of a negative investment
variance offset by a GBP300 million provision for customer redress, led to the 5
per cent growth in headline earnings.

As a result of this view on performance, we have set a number of priorities to
manage the Group.  Firstly, to manage the business portfolio and reduce earnings
volatility.  Secondly, to maintain and build profitability and, thirdly, to
position the Group to deliver growth from within our retail, and corporate and
commercial customer franchises.

Managing the business portfolio

We are managing the Group around our core business units, for which we have set
criteria.  Accordingly, the Group has announced a review of its strategic
options for The National Bank of New Zealand, and disposed of its French fund
management and private banking businesses.

Our emerging markets debt portfolio, which totalled GBP1.1 billion at the end of
2002, has now been sold, at a significant profit, as we accelerated the disposal
programme to take full advantage of improving secondary bond market trading
conditions.  The Group's exposure in Latin America has continued to be reduced.

In the Group's life assurance businesses, we have reviewed profitability, design
and risk profile by individual product line to seek to improve the capital
efficiency and near-term cash profile.  We are implementing a plan to focus new
business development on the more profitable, and capital efficient, areas.  Our
objectives are to ensure no capital demands, for either solvency or business
growth purposes, are made to the Group for FTSE 100 levels above 3000; to run
the business to generate free cash flow; and ensure that new business exceeds
our minimum cost of equity hurdle rate.

                                  Page 3 of 48


LLOYDS TSB GROUP

The equity content in both Scottish Widows' with-profits fund and shareholder
owned estate has been reduced, and the Group has improved its protection against
short-term volatility in UK equity markets by hedging part of its equity
portfolio into 2004.  Scottish Widows remains one of the most strongly
capitalised life assurance companies in the UK.

In recent times, considerable changes in regulatory and public attitudes to both
the sale and performance of financial products, have had a major impact on the
financial services industry.  We have been subject to these same factors and we
have experienced some lapses in our own sales processes.  This has led to
unacceptable levels of customer dissatisfaction and the need for redress.  We
have now put in place new sales management processes and incentive plans
designed to guide the organisation to build deep, long-term customer
relationships.

Maintaining and building profitability

We have undertaken a review of capital usage within the Group and we are
introducing an enhanced focus on economic capital management, supported by the
introduction of a more rigorous equity attribution model.  The key financial
measures of performance will be economic profit growth and return on economic
equity.  Our balance sheet is starting to reflect the impact of this renewed
focus on capital efficiency with the redeployment of capital resources to higher
return relationship businesses, for example in consumer lending.  We have also
improved the capital efficiency in our life business, and reduced the Group's
portfolio of debt securities by 2 per cent.

The Group operates in a very competitive environment.  Margins continue to
decline, albeit at a slower underlying rate as we focus on improving volumes and
the mix of our business, and we continue to expect further gradual product
margin erosion.  To help offset this effect on our profitability, we aim to
deliver good levels of quality balance sheet growth, whilst keeping costs firmly
under control.

Whilst ensuring that we commit investment to growth businesses, cost control
will continue to have high priority throughout the Group.  The increasing use of
straight through processing, and our introduction of a 6 sigma approach to
excellence in our key operational processes has started to improve our cost
effectiveness and customer service levels.  The Group is also piloting, with
some initial success, limited outsourcing of processing and back office
operations.

Positioning the Group for growth

Today, all major business lines within the Group deliver satisfactory returns on
capital and no further large in-market acquisitions are currently anticipated
within the UK banking environment.  The Group's fundamental challenge is
therefore to deliver organic growth.


                                  Page 4 of 48


LLOYDS TSB GROUP

The Group has identified broad areas from which to deliver growth.  We are a
significant player, with 20 per cent, or greater, shares in the UK personal and
small business markets combined with the largest multi-channel distribution
network in the UK.  However, we still account for only 10 per cent of the total
economic profits of the UK financial services market.  The opportunity is
therefore considerable, but realising it will require the Group to deliver a
consistently high performance, improve the use of its existing assets, and
ensure our resources are committed to growth businesses. We aim to capture
market share by leveraging our retail, and corporate and commercial customer
franchises, our distribution strength and our knowledge of our customers'
financial activity and requirements.  On average, for example, our retail
customers spend twice as much on our competitors' products and services, as they
do on our own.  This story is similar for our corporate and commercial customers
where, despite a strong blue-chip corporate franchise, we are currently
under-represented in the product purchases of these customers in a number of
profitable areas.

In the retail business, our focus on the opportunity within the core franchise
has already resulted in an increased market share of credit cards, bank savings
and mortgages, in some cases reversing the declining trends of recent years.

Lloyds TSB is a high performing business, with significant strengths in
distribution, brand management and its customer base, but our growth has slowed
in recent years.  We are reviewing and actively managing the Group's portfolio
of businesses to focus on our core assets, whilst seeking to reduce earnings
volatility, and much has already been achieved in the first half of the year.
We aim to maintain our levels of profitability and a high return on economic
equity.  We have identified a number of significant opportunities for growth
within our core businesses and, over the next few months, will be developing
detailed implementation plans.  We already have evidence of the success of this
approach in our retail banking business, where like-for-like profits increased
by 12 per cent in the first half of 2003.  Whilst recognising the substantial
economic, regulatory and competitive pressures we face, our key focus going
forward will be to build on these growth opportunities.

J. Eric Daniels
Group Chief Executive


                                  Page 5 of 48


LLOYDS TSB GROUP 2003 INTERIM RESULTS



                                   SUMMARY OF RESULTS

                                                                   Half-year to            Increase      Half-year to
                                                                      30 June             (Decrease)      31 December
                                                                2003           2002                            2002
Results                                                         GBPm           GBPm            %               GBPm
                                                                                                   

Total income                                                    4,934          4,597            7             4,281
Operating expenses                                              2,629          2,360           11             2,555
Trading surplus                                                 2,305          2,237            3             1,726
Provisions for bad and doubtful debts                             470            479           (2)              550
Profit before tax                                               1,677          1,604            5             1,003
Profit attributable to shareholders                             1,155          1,113            4               668
Economic profit (page 43, note 2)                                 785            633           24               188
Earnings per share (pence)                                       20.7           20.0            4              12.0
Post-tax return on average shareholders' equity (%)              28.1           20.9                           12.5
Results, excluding changes in economic
assumptions and investment variance
Profit before tax                                               1,643          2,003          (18)            1,501
Earnings per share (pence)                                       20.2           25.4          (20)             18.7
Post-tax return on average shareholders' equity (%)              27.4           26.5                           19.6

Shareholder value
Closing market price per share (period-end)                      430p           653p                           446p
Total market value of shareholders' equity                  GBP24.0bn      GBP36.5bn                      GBP24.8bn
Dividends per share                                             10.7p          10.7p            -             23.5p

Balance sheet                                                    GBPm           GBPm                          GBPm
Shareholders' equity                                            8,656         10,976          (21)            7,972
Net assets per share (pence)                                      153            194          (21)              141
Total assets                                                  264,679        246,379            7           252,758
Loans and advances to customers                               141,990        128,478           11           134,474
Customer deposits                                             121,433        113,787            7           116,334

Risk asset ratios                                                  %              %                              %
Total capital                                                    10.1            9.5                            9.6
Tier 1 capital                                                    8.1            7.8                            7.8




                                  Page 6 of 48



LLOYDS TSB GROUP

                         REVIEW OF FINANCIAL PERFORMANCE

In the first  half of 2003 the  Group's  profit  before tax  increased  by GBP73
million, or 5 per cent, to GBP1,677 million,  from GBP1,604 million in the first
half of 2002.  Total  income  increased  by GBP337  million,  or 7 per cent,  to
GBP4,934 million whilst operating  expenses  increased by GBP269 million,  or 11
per cent. The Group's results  comparisons are however heavily influenced by the
impact of the GBP399 million negative  investment  variance in the first half of
2002 and,  excluding  investment  variance and changes in economic  assumptions,
profit before tax fell by 18 per cent, or GBP360 million,  to GBP1,643  million,
compared with the first half of last year. A number of other  significant  items
affected the Group's results in the first half of 2003 including,  particularly,
exceptional  gains from the sale of the Group's  emerging markets debt portfolio
and a GBP300 million  provision for customer  redress  relating to past sales of
certain  stock  market  investment  and  long-term  savings  products.  Overall,
excluding special items, Group profits were broadly flat,  compared with the two
previous half-years,  as good growth in customer lending and deposits was offset
by further margin erosion,  the impact of continuing stock market uncertainty on
revenues in the Group's life  assurance and wealth  management  businesses,  and
lower creditor insurance income in our general insurance business as a result of
the slowdown in the rate of growth in UK consumer  credit.  Excluding the impact
of  acquisitions,  operating  lease  depreciation  and  provisions  for customer
redress, operating expenses were held flat.

In many of its key product areas the Group continued to grow its market share
and, as a result, customer lending and deposits continued to grow strongly.
Over the last 12 months, customer lending grew by 11 per cent to GBP142 billion
and customer deposits increased by 7 per cent to GBP121 billion.  The Group net
interest margin was 3.01 per cent, compared with 3.27 per cent in the first half
of 2002.  The implementation of the remedies proposed in March 2002 by the
Competition Commission's report, following its investigation into the supply of
banking services to small and medium size enterprises (SMEs), reduced the
Group's net interest margin in the first half of 2003 by some 10 basis points.
The strong growth in lending and deposit volumes, however, ensured that this
reduction in the Group net interest margin was more than compensated for by
volume growth, resulting in overall growth in net interest income of 1 per cent
compared with the first half of 2002.

Profit  attributable to shareholders  was 4 per cent higher at GBP1,155  million
and earnings per share  increased by 4 per cent to 20.7p.  Shareholders'  equity
decreased  by GBP2,320  million to GBP8,656  million,  compared  with  GBP10,976
million  at the end of the  first  half of  2002,  following  the  reduction  of
GBP2,331  million  in the value of the  Group's  pension  schemes  during  2002.
Compared  with  the  shareholders'  equity  of  GBP7,972  million  at the end of
December  2002  there has been an  increase  of GBP684  million,  or 9 per cent,
during  the first half of 2003.  The  post-tax  return on average  shareholders'
equity was 28.1 per cent,  compared  to 20.9 per cent in the first half of 2002,
and 12.5 per cent in the second half of 2002, and economic  profit  increased by
24 per cent to GBP785  million.  These  increases,  compared with 2002,  largely
reflect the  reduction in  shareholders'  equity at the end of 2002 and also the
absence  in the  first  half of  2003 of a  negative  investment  variance.  The
post-tax  return on average assets was 1.14 per cent, and the post-tax return on
average risk-weighted assets was 1.91 per cent.

                                  Page 7 of 48


LLOYDS TSB GROUP

Pre-tax profit from UK Retail Banking and Mortgages,  excluding a GBP200 million
provision for customer  redress,  increased by GBP9  million,  or 1 per cent, to
GBP631  million,  compared with the first half of 2002.  On the same basis,  and
excluding the impact of the  implementation of the Competition  Commission's SME
remedies which reduced profits in the Group's business banking portfolio by some
GBP65 million,  pre-tax profit from UK Retail Banking and Mortgages increased by
some GBP74  million,  or 12 per cent,  to GBP696  million.  Notwithstanding  the
general slowdown in growth in UK consumer credit lending there was strong growth
in  credit  card  lending,  up 26  per  cent,  and  in  personal  loan  balances
outstanding,  up 8 per cent.  Current account and savings and investment account
balances, within Retail Banking, increased by 9 per cent. Costs remained tightly
controlled and asset quality generally remains satisfactory.  Provisions for bad
and doubtful debts  increased by GBP65 million to GBP335  million,  largely as a
result of volume  related  asset  growth in the  personal  loan and credit  card
portfolios,  and a higher charge for fraud in the personal  lending  portfolios.
Overall, the arrears position was stable.

In the  Mortgages  business,  gross new  lending  increased  by 50 per cent to a
record GBP12.0 billion,  compared with GBP8.0 billion in the first half of 2002.
Net new lending was GBP4.8  billion,  compared with GBP2.0  billion in the first
half of 2002,  resulting in an estimated market share of net new lending of 11.4
per cent.  As a result of this strong  growth in both gross and net new lending,
mortgage balances outstanding increased by 8 per cent to GBP67.3 billion, during
the first half of 2003.

Profit  before  tax,  excluding  changes  in  economic  assumptions,  investment
variance and a GBP100 million provision for customer redress, from Insurance and
Investments  decreased by GBP168  million,  or 22 per cent,  to GBP589  million,
partly as a result of a reduction of GBP101 million in benefits from  experience
variances and assumption  changes,  and lower  normalised  investment  earnings.
Overall  weighted sales in the Group's life,  pensions and unit trust businesses
in the first half of 2003 were GBP366.6 million, compared to GBP372.7 million in
the first half of last year, a decrease of 2 per cent. This decrease in weighted
sales  reflected a 5 per cent increase in weighted sales from life and pensions,
more than offset by a 22 per cent  reduction in weighted sales from unit trusts,
largely  caused  by  ongoing  stock  market   uncertainty   which  continues  to
significantly  reduce  customer  demand  for unit  trust  and  equity-based  ISA
products.  Weighted  sales from  independent  financial  advisors rose by 36 per
cent,  whilst sales through the branch network  remained subdued and were 25 per
cent lower. In the Group's general  insurance  operations,  continued  growth in
household  insurance  income was offset by a 14 per cent  reduction  in creditor
insurance  income,  as a result of the  general  slowdown  in growth in personal
lending.

Wholesale Markets pre-tax profit increased by GBP14 million, or 4 per cent, to
GBP368 million, as strong profit growth in Lloyds TSB Asset Finance and a
reduction in provisions for bad and doubtful debts more than offset the impact
of the introduction of the Competition Commission's SME report remedies, and
lower income from Treasury.  Growth in customer lending and the impact of
acquisitions in the asset finance business resulted in a GBP66 million, or 6 per
cent, increase in total income.  Operating expenses increased by GBP81 million,
again largely as a result of the asset finance acquisitions.  The provisions
charge for bad and doubtful debts decreased by GBP43 million, despite a small
increase in provisions within the asset finance businesses reflecting portfolio
growth.  In the first half of 2002, provisions against Group loans and advances
to certain large US corporate customers totalled some GBP70 million.

                                  Page 8 of 48


LLOYDS TSB GROUP

International  Banking pre-tax profit increased by GBP4 million,  or 2 per cent,
to  GBP235  million,  notwithstanding  a GBP15  million  loss on the sale of the
Group's French wealth management  businesses,  and a GBP23 million profit on the
sale and  leaseback  of  premises  in the first half of 2002.  Profits  from The
National  Bank of New Zealand  increased  by 34 per cent to GBP147  million as a
result of good growth in all core businesses,  particularly  mortgages and small
business banking. Pre-tax profits from the Group's Offshore and European Private
Banking  operations,  however,  decreased as a result of lower volumes and stock
market  related fee income.  In a market  affected by high interest  rates,  our
consumer finance  business in Brazil,  Losango,  increased  lending volumes and,
with  the  benefit  of more  favourable  bond  market  conditions,  the  Group's
businesses in Brazil made a pre-tax profit of GBP46 million, compared with GBP32
million in the first half of 2002.

The total Group charge for bad and doubtful debts was 2 per cent lower at GBP470
million, compared with GBP479 million in the first half of 2002, and 15 per cent
lower than the GBP550  million  charge in the second half of 2002.  In UK Retail
Banking,  the provisions  charge increased by GBP68 million,  or 25 per cent, to
GBP340  million,  partly  as a result  of  volume  related  asset  growth in the
personal  loan and credit card  portfolios,  which grew by 8 per cent and 26 per
cent  respectively,  but also as a result  of a higher  charge  for fraud in the
personal lending portfolios.  In Mortgages, an improved arrears position and the
beneficial effect of house price increases resulted in a GBP5 million provisions
release for the half-year. In Wholesale Markets, the provisions charge decreased
by GBP43 million to GBP108 million.  International  Banking provisions decreased
to GBP40  million,  from GBP63 million in the first half of 2002, as a result of
the  absence  of an  increase  in general  provisions  relating  to the  Group's
exposure to Argentina.  The Group's charge for bad and doubtful debts, expressed
as a percentage of average lending, was 0.66 per cent, compared to 0.75 per cent
in the first half of 2002.

During the first half of 2003 the Group accelerated the sale of its portfolio of
emerging markets debt investments to take full advantage of improving secondary
bond market conditions.  Profits on bond sales, and certain closed foreign
exchange positions, in the first half of 2003 totalled some GBP295 million.  The
Group does not expect to achieve any further contribution from the emerging
markets debt portfolio in the second half of 2003 and beyond.

The Group has carried out, in conjunction  with the regulator,  an investigation
into the  appropriateness  of certain sales of the Extra Income & Growth Plan, a
stock  market  related   investment   product  sold  in  2000  and  2001.   This
investigation  is now largely  complete and the Group is in a better position to
quantify the financial effect. During the first half of 2003 there has also been
an increase in the level of complaints  relating to Group sales and  performance
of certain  endowment  based and long-term  savings  products.  Whilst the Group
maintains  provisions for customer redress in respect of past product sales, the
adequacy  of  these  provisions  has  been  reviewed  in the  light  of  ongoing
experience  and the drawing to a  conclusion  of the Extra  Income & Growth Plan
investigation.  As a result,  the estimated total cost of redress is forecast to
increase by some GBP300 million, largely reflecting sales of endowment based and
long-term savings products,  and an additional provision of this amount has been
made. The adequacy of this provision will be kept under review.

                                  Page 9 of 48


LLOYDS TSB GROUP

The total  capital  ratio was 10.1 per cent and the tier 1 capital ratio was 8.1
per cent. Risk-weighted assets increased by 4 per cent to GBP127.5 billion, from
GBP122.4  billion  at the end of 2002.  At the end of June  2003,  the  Scottish
Widows free asset  ratio was an  estimated  12.7 per cent,  compared to 12.2 per
cent at the end of 2002  (page  46,  note  7).  The  equity  backing  ratio  for
traditional  with-profits  policies at 30 June 2003 was 48 per cent (equities 35
per  cent;  property  13 per  cent).  Scottish  Widows  remains  one of the most
strongly  capitalised  life  assurance  companies  in the UK; able to  withstand
significant  stock market falls  without an injection of capital.  The Group has
not injected  additional  capital from outside the Group's insurance  businesses
into Scottish Widows, and does not expect to inject capital into Scottish Widows
unless the level of the FTSE 100 index falls to, and remains, below 3000.

The  Group  continues  to  generate  strong  profits  from its  operations  and,
excluding  investment variance and changes in economic  assumptions,  the profit
attributable to shareholders in the first half of 2003 was GBP1,128 million. The
Board has decided to maintain the interim dividend at 10.7p per share.

                                 Page 10 of 48


LLOYDS TSB GROUP

                         CONSOLIDATED PROFIT AND LOSS ACCOUNT (unaudited)




                                                                            Half-year to              Half-year to
                                                                              30 June                 31 December
                                                                       2003              2002               2002
                                                                       GBPm              GBPm               GBPm
                                                                                                    

Interest receivable:
  Interest receivable and similar income arising from
  debt securities                                                        245              278                289
  Other interest receivable and similar income                         4,764            4,868              5,114
Interest payable                                                       2,438            2,589              2,789
Net interest income                                                    2,571            2,557              2,614
Other finance income                                                      17               85                 80
Other income
Fees and commissions receivable                                        1,509            1,523              1,530
Fees and commissions payable                                            (346)            (306)              (339)
Dealing profits (before expenses)                                        427               88                100
Income from long-term assurance business                                 175               23               (326)
General insurance premium income                                         261              235                251
Other operating income                                                   320              392                371
                                                                       2,346            1,955              1,587
Total income                                                           4,934            4,597              4,281
Operating expenses

Administrative expenses                                                2,287            2,040              2,174
Depreciation                                                             318              299                343
Amortisation of goodwill                                                  24               21                 38
Depreciation and amortisation                                            342              320                381
Total operating expenses                                               2,629            2,360              2,555
Trading surplus                                                        2,305            2,237              1,726
General insurance claims                                                 108              107                122
Provisions for bad and doubtful debts
Specific                                                                 466              451                514
General                                                                    4               28                 36
                                                                         470              479                550
Amounts written off fixed asset investments                               24               39                 48
Operating profit                                                       1,703            1,612              1,006

Income from joint ventures                                               (11)              (8)                (3)
Loss on sale of businesses                                               (15)               -                  -
Profit on ordinary activities before tax                               1,677            1,604              1,003

Tax on profit on ordinary activities                                     489              462                302
Profit on ordinary activities after tax                                1,188            1,142                701
Minority interests   - equity                                             10                9                 10
                     - non-equity                                         23               20                 23
Profit for the period attributable to shareholders                     1,155            1,113                668

Dividends                                                                597              597              1,311
Profit (loss) for the period                                             558              516               (643)

Earnings per share                                                     20.7p            20.0p              12.0p
Diluted earnings per share                                             20.6p            19.9p              11.9p



                                 Page 11 of 48

LLOYDS TSB GROUP

                              CONSOLIDATED BALANCE SHEET



                                                                           30 June         30 June        31 December
                                                                             2003            2002              2002
                                                                         (unaudited)     (unaudited)        (audited)
Assets                                                                       GBPm            GBPm              GBPm
                                                                                                       

Cash and balances at central banks                                            857              717             1,140
Items in course of collection from banks                                    2,433            2,384             1,757
Treasury bills and other eligible bills                                     3,577            3,645             2,409
Loans and advances to banks                                                18,306           18,386            17,529
Loans and advances to customers                                           141,990          128,478           134,474
Debt securities                                                            28,682           27,022            29,314
Equity shares                                                                 230              222               206
Interests in joint ventures                                                    38               33                45
Intangible assets                                                           2,615            2,646             2,634
Tangible fixed assets                                                       3,974            3,806             4,096
Own shares                                                                     29               38                18
Other assets                                                                5,631            4,768             5,263
Prepayments and accrued income                                              2,142            2,587             2,305
Post-retirement benefit asset                                                   -              319                 -
Long-term assurance business attributable
to the shareholder                                                          6,362            6,506             6,228
                                                                          216,866          201,557           207,418
Long-term assurance assets attributable to policyholders                   47,813           44,822            45,340
Total assets                                                              264,679          246,379           252,758
Liabilities
Deposits by banks                                                          23,882           22,091            25,443
Customer accounts                                                         121,433          113,787           116,334
Items in course of transmission to banks                                      981              960               775
Debt securities in issue                                                   34,498           31,495            30,255
Other liabilities                                                           8,427            7,320             8,289
Accruals and deferred income                                                3,479            3,339             3,696
Post-retirement benefit liability                                           2,168               74             2,077
Provisions for liabilities and charges:
  Deferred tax                                                              1,271            1,399             1,317
  Other provisions for liabilities and charges                                532              282               361
Subordinated liabilities:
  Undated loan capital                                                      6,063            4,622             5,496
  Dated loan capital                                                        4,733            4,655             4,672
Minority interests:
  Equity                                                                       47               33                37
  Non-equity                                                                  696              524               694
                                                                              743              557               731
Called-up share capital                                                     1,417            1,415             1,416
Share premium account                                                       1,121            1,093             1,093
Merger reserve                                                                343              343               343
Profit and loss account                                                     5,775            8,125             5,120
Shareholders' funds (equity)                                                8,656           10,976             7,972
                                                                          216,866          201,557           207,418
Long-term assurance liabilities to policyholders                           47,813           44,822            45,340
Total liabilities                                                         264,679          246,379           252,758



                                 Page 12 of 48

LLOYDS TSB GROUP

                         CONSOLIDATED CASH FLOW STATEMENT (unaudited)



                                                                               Half-year to             Half-year to
                                                                                  30 June                31 December
                                                                            2003            2002             2002
                                                                            GBPm            GBPm             GBPm
                                                                                                     

Net cash inflow from operating activities                                   4,670           4,235            1,159
Dividends received from associated undertakings                                 5               2                -
Returns on investments and servicing of finance:
Dividends paid to equity minority interests                                     -             (13)              (5)
Payments made to non-equity minority interests                                (40)            (20)             (23)
Interest paid on subordinated liabilities (loan capital)                     (297)           (231)            (232)
Net cash outflow from returns on investments and
servicing of finance                                                         (337)           (264)            (260)
Taxation:
UK corporation tax                                                           (205)           (329)            (429)
Overseas tax                                                                 (119)            (90)            (103)
Total taxation                                                               (324)           (419)            (532)
Capital expenditure and financial investment:
Additions to fixed asset investments                                      (19,519)        (23,866)         (22,964)
Disposals of fixed asset investments                                       18,656          23,740           21,767
Additions to tangible fixed assets                                           (346)           (536)            (779)
Disposals of tangible fixed assets                                            154             114              245
Capital injection to life fund                                                  -            (140)               -
Net cash outflow from capital expenditure
and financial investment                                                   (1,055)           (688)          (1,731)
Acquisitions and disposals:
Additions to interests in joint ventures                                       (6)             (6)             (15)
Acquisition of group undertakings                                              (1)            (53)             (64)
Net cash outflow from acquisitions and disposals                               (7)            (59)             (79)
Equity dividends paid                                                      (1,311)         (1,306)            (597)
Net cash inflow (outflow) before financing                                  1,641           1,501           (2,040)
Financing:
Issue of subordinated liabilities (loan capital)                              532           1,145              975
Issue of ordinary share capital net of GBP3 million
(2002 first half: GBP56 million; second half: GBP6 million)
charge in respect of the QUEST                                                 26              82               (5)
Repayments of subordinated liabilities (loan capital)                         (54)            (48)              (7)
Minority investment in subsidiaries                                             -               -              167
Capital element of finance lease rental payments                               (1)             (3)              (1)
Net cash inflow from financing                                                503           1,176            1,129
Increase (decrease) in cash                                                 2,144           2,677             (911)




                                 Page 13 of 48



LLOYDS TSB GROUP

                                         SEGMENTAL ANALYSIS



Half-year to
30 June 2003                      UK Retail
                                   Banking        Insurance
                                     and             and         Wholesale  International      Central
                                  Mortgages      Investments      Markets       Banking       group items        Total
                                     GBPm             GBPm         GBPm           GBPm           GBPm             GBPm
                                                                                               

Net interest income                  1,719             39           574            406           (167)           2,571
Other finance income                     -              -             -              -             17               17
Other income                           558            771           518            177            288            2,312
Total income                         2,277            810         1,092            583            138            4,900
Operating expenses                   1,500            213           593            292             31            2,629
Trading surplus                        777            597           499            291            107            2,271
General insurance claims                -             108             -              -              -              108
Bad debt provisions                    335              -           108             40            (13)             470
Amounts written off
fixed asset investments                  -              -            23              1              -               24
Income from joint ventures             (11)             -             -              -              -              (11)
Loss on sale of businesses               -              -             -            (15)             -              (15)
Profit before tax*                     431            489           368            235            120            1,643
Changes in economic
assumptions                              -             (8)            -              -              -               (8)
Investment variance                      -             42             -              -              -               42
Profit before tax                      431            523           368            235            120            1,677





Half-year to                      UK Retail
30 June 2002                       Banking      Insurance
                                     and           and          Wholesale   International      Central
                                  Mortgages     Investments      Markets        Banking      group items        Total
                                     GBPm           GBPm           GBPm           GBPm           GBPm            GBPm
                                                                                                

Net interest income                  1,680             33           579            383           (118)           2,557
Other finance income                     -              -             -              -             85               85
Other income                           533          1,073           447            188            113            2,354
Total income                         2,213          1,106         1,026            571             80            4,996
Operating expenses                   1,313            242           512            277             16            2,360
Trading surplus                        900            864           514            294             64            2,636
General insurance claims                 -            107             -              -              -              107
Bad debt provisions                    270              -           151             63             (5)             479
Amounts written off
fixed asset investments                  -              -             9              -             30               39
Income from joint ventures              (8)             -             -              -              -               (8)
Profit before tax*                     622            757           354            231             39            2,003
Investment variance                      -           (399)            -              -              -             (399)
Profit before tax                      622            358           354            231             39            1,604



*excluding changes in economic assumptions and investment variance

                                  Page 14 of 48


LLOYDS TSB GROUP

Segmental analysis (continued)




Half-year to                      UK Retail
31 December 2002                   Banking        Insurance
                                      and            and        Wholesale   International      Central
                                   Mortgages     Investments     Markets        Banking       group items        Total
                                      GBPm           GBPm          GBPm           GBPm           GBPm            GBPm
                                                                                                

Net interest income                  1,742             41           597            367           (133)           2,614
Other finance income                     -              -             -              -             80               80
Other income                           543            792           528            186             36            2,085
Total income                         2,285            833         1,125            553            (17)           4,779
Operating expenses                   1,370            240           621            304             20            2,555
Trading surplus                        915            593           504            249            (37)           2,224
General insurance claims                 -            122             -              -              -              122
Bad debt provisions                    293              -           160             99             (2)             550
Amounts written off
fixed asset investments                  -              -            48              -              -               48
Income from joint ventures              (3)             -             -              -              -               (3)
Profit before tax*                     619            471           296            150            (35)           1,501
Changes in economic
assumptions                              -             55             -              -              -               55
Investment variance                      -           (553)            -              -              -             (553)
Profit before tax                      619            (27)          296            150            (35)           1,003



*excluding changes in economic assumptions and investment variance


                         PERIOD END ASSETS BY MAIN BUSINESSES



                                                                                   30 June                 31 December
                                                                             2003             2002             2002
                                                                             GBPm             GBPm             GBPm
                                                                                                       

UK Retail Banking and Mortgages                                             91,921           81,255           85,868
Insurance and Investments*                                                   9,400            9,633            9,161
Wholesale Markets                                                           92,148           87,823           89,547
International Banking                                                       22,992           21,439           21,298
Central group items                                                            405            1,407            1,544
Total assets*                                                              216,866          201,557          207,418


*excluding long-term assurance assets attributable to policyholders


                                 Page 15 of 48

LLOYDS TSB GROUP

                            PERFORMANCE BY SECTOR

UK Retail Banking and Mortgages

(covering the Group's UK retail businesses, providing banking and financial
services to personal and small business customers; mortgages; private banking
and stockbroking)



                                                                               Half-year to            Half-year to
                                                                                  30 June               31 December
                                                                            2003            2002             2002
                                                                            GBPm            GBPm             GBPm
                                                                                                     

Net interest income                                                         1,719           1,680            1,742
Other income                                                                  558             533              543
Total income                                                                2,277           2,213            2,285
Operating expenses:
Before provisions for customer redress                                      1,300           1,313            1,370
Provisions for customer redress                                               200               -                -
                                                                            1,500           1,313            1,370
Trading surplus                                                               777             900              915
Provisions for bad and doubtful debts                                         335             270              293
Income from joint ventures                                                    (11)             (8)              (3)
Profit before tax                                                             431             622              619

Profit before tax, before provisions for customer redress                     631             622              619

Efficiency ratio, before provisions for customer redress                    57.1%           59.3%            60.0%
Total assets (period-end)                                               GBP91.9bn       GBP81.3bn        GBP85.9bn
Total risk-weighted assets (period-end)                                 GBP57.7bn       GBP51.2bn        GBP54.2bn


Profit before tax from UK Retail Banking and Mortgages,  before customer redress
provisions,  increased by GBP9 million to GBP631  million,  compared with GBP622
million in the first half of 2002 as a result of continued  strong growth in the
Group's consumer lending  portfolios,  particularly  mortgages and credit cards,
and a strict focus on cost  control,  which offset a reduction in income of some
GBP65  million in the Group's  business  banking  portfolio,  as a result of the
implementation  of the  Competition  Commission's  SME  remedies.  Excluding the
impact of these remedies and provisions for customer redress,  profit before tax
from UK Retail Banking and Mortgages  increased by 12 per cent, as a result of a
6 per cent growth in income and flat costs.

Total income increased by GBP64 million, or 3 per cent, to GBP2,277 million. Net
interest income increased by GBP39 million,  or 2 per cent, to GBP1,719 million,
as growth in the mortgage and consumer  credit  portfolios  more than offset the
impact of the Competition  Commission's  SME remedies.  Personal loan and credit
card balances  outstanding  increased by 8 per cent and 26 per cent respectively
and,  within  Retail  Banking,  balances  on current  accounts  and  savings and
investment  accounts  grew by 9 per  cent.  Over  the last 12  months,  mortgage
balances outstanding  increased by 15 per cent to GBP67.3 billion.  Other income
increased by GBP25 million to GBP558 million. There was an improvement in income
earned  from  credit and debit  cards,  and  increased  income  from added value
current  accounts,  but this was  partly  offset  by a higher  level of fees and
commissions payable.

                                 Page 16 of 48

LLOYDS TSB GROUP

UK Retail Banking and Mortgages (continued)

Excluding provisions for customer redress, operating expenses decreased by GBP13
million,  or 1 per cent,  to  GBP1,300  million  during  the first half of 2003,
compared to GBP1,313  million in the first half of 2002.  The  efficiency  ratio
improved  to 57.1 per cent,  from 59.3 per cent in the first  half of last year.
The  trading  surplus  increased  by GBP77  million,  or 9 per  cent,  to GBP977
million.

Bad debt provisions  increased by GBP65 million to GBP335  million,  mainly as a
result of volume  related asset growth in personal loan and credit card lending,
and a higher charge for fraud in the personal lending portfolio.  The provisions
charge as a  percentage  of average  lending for personal  loans and  overdrafts
increased to 4.44 per cent, from 3.82 per cent in the first half of 2002,  while
the charge in the credit card  portfolio  decreased to 3.34 per cent,  from 3.50
per cent in the  first  half of 2002.  Overall  the  arrears  position  remained
broadly stable.




Provisions for bad and doubtful debts by product                               Half-year to              Half-year to
                                                                                   30 June                31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Personal loans/overdrafts                                                     218             168              176
Credit cards                                                                   85              71               82
Business Banking                                                               37              33               34
Mortgages                                                                      (5)             (2)               1
                                                                              335             270              293

Charge as a percentage of average lending                                      %               %                %
Personal loans/overdrafts                                                    4.44            3.82             3.65
Credit cards                                                                 3.34            3.50             3.53
Business Banking                                                             1.34            1.21             1.22
Mortgages                                                                   (0.02)          (0.01)            0.00



In UK Retail Banking, strategic focus has been placed on organic growth; a
number of programmes and initiatives are now underway, and are proving
successful.  There is increased focus on quality; acquiring and retaining higher
value customers by meeting customer needs with tailored offers through a highly
segmented approach, and deepening relationships through the use of our
sophisticated customer relationship management capabilities.  Day-to-day costs
remain tightly controlled, while exploratory work and pilot schemes continue to
assess the scope of outsourcing opportunities to further improve central
processing efficiencies.

Our multi-channel distribution, comprising a network of over 2,000 branches, one
of the largest telephone banking operations in the UK, and lloydstsb.com, our
internet banking system, one of the most visited financial websites in Europe,
offers extensive customer choice.  The retail bank has continued to develop a
strategy of building deeper customer relationships, focusing product design to
support the retention and recruitment of higher value customers, whilst
retaining multi-channel functionality, and progressively meeting customer needs
through increased use of lower cost distribution channels.

                                 Page 17 of 48


LLOYDS TSB GROUP

UK Retail Banking and Mortgages (continued)

The Group's internet bank continues to increase in popularity and customer
usage.  In the first half of 2003 over 10 million bill payments or account
transfers were processed on-line.  Product sales via the internet channel
continue to grow rapidly, with more than 60,000 product sales per month, up 80
per cent on the first half of 2002.

Within cards, supported by the launch of a number of segmented, competitive and
innovative product offers including the Create card and the Premier Credit Card,
strong growth was achieved both in new accounts and balances outstanding.
Market share grew to an estimated 11 per cent.  A general slowdown in the rate
of growth of consumer credit in the UK led to a reduction in the rate of
personal loan volume growth, although balances outstanding increased by 8 per
cent in the year to 30 June 2003.

The launch of the Group's "Plus" range of interest-bearing current accounts has
supported the retention of high quality customers within the retail banking
franchise, as well as being positioned to attract new-to-brand customers through
a competitively priced offer, reflecting the use of lower cost distribution
channels.  Supported by the launch of "Plus" in February 2003, customer
attrition rates have fallen by a fifth, reflecting improved levels of customer
satisfaction and the Group's improved range of segmented and targeted offers in
the personal market.  Lloyds TSB has maintained its clear market leadership in
the added value current account market.  Extensive work continues, to improve
levels of service and customer satisfaction, with a focus on continuous
performance improvement and innovation to meet customer needs and expectations.

Volatility in equity markets has continued to restrict short-term opportunities
within the UK wealth management business.  Lloyds TSB continues to be well
positioned in this attractive market which has good long-term growth prospects,
however, with a range of segmented offers, including the launch of its new
Premier banking service for the "mass affluent".

Following a successful pilot, the Group is now proceeding with national roll-out
of Lloyds TSB energy and home telephone products.  By leveraging the strategic
advantages offered by the Lloyds TSB customer base, distribution strength and
brand, the provision of Lloyds TSB branded gas, electricity and home telephone
services adds value to existing customer relationships, and provides an
opportunity for the Group to build new sustainable revenue streams.

Business Banking continued to grow its customer franchise,  regaining leadership
in the  start-up  market,  with  customer  deposits  growing  by 4 per  cent  to
GBP10,046  million,  from  GBP9,693  million  in  June  2002.  Customer  lending
increased  slightly to GBP5,589 million,  from GBP5,567 million in June 2002. In
March 2002, the Competition  Commission's  report,  following its  investigation
into the supply of banking services to small and medium size enterprises (SMEs),
was  published  by the  government.  The  Group  has  implemented  the  remedies
suggested by the Competition  Commission and, as a result of this issue,  profit
before tax of  Business  Banking  in the first half of 2003 was  reduced by some
GBP65 million.

                                 Page 18 of 48

LLOYDS TSB GROUP

UK Retail Banking and Mortgages (continued)




Mortgages                                                                      Half-year to             Half-year to
                                                                                 30 June                 31 December
                                                                            2003            2002             2002
                                                                                                    

Gross new mortgage lending                                               GBP12.0bn        GBP8.0bn        GBP11.0bn
Market share of gross new mortgage lending                                   10.0%            8.3%             9.0%
Net new mortgage lending                                                  GBP4.8bn        GBP2.0bn         GBP3.9bn
Market share of net new mortgage lending                                     11.4%            5.8%             8.8%
Mortgages outstanding (period-end)                                       GBP67.3bn       GBP58.6bn        GBP62.5bn
Market share of mortgages outstanding                                         9.4%            9.3%             9.3%


Gross new lending increased by 50 per cent to a record GBP12.0 billion, compared
with GBP8.0 billion in the first half of 2002 and GBP11.0  billion in the second
half of 2002. Net new lending  increased to GBP4.8 billion resulting in a market
share of net new lending of 11.4 per cent. Over the last twelve months, mortgage
balances outstanding increased by 15 per cent to GBP67.3 billion.

The Group continues to be one of the most efficient mortgage providers in the UK
and Cheltenham & Gloucester's (C&G) total costs as a percentage of mortgage
assets were an annualised 0.5 per cent in the first half of 2003.  C&G continues
to benefit from mortgage sales distribution through the Lloyds TSB branch
network, the IFA market and from the strength of the C&G brand.  In addition, C&
G Teledirect, its internet and telephone operation, continued to perform
strongly, and business levels sourced from intermediaries remain strong.

A slight improvement in arrears and the beneficial effect of house price
increases have meant that bad debt provisions remained at low levels.  New
provisions were more than offset by releases and recoveries resulting in a GBP5
million net provisions release for the half-year, compared with a net release of
GBP2 million in the first half of 2002.  The quality of our mortgage lending
continues to be good.  The average indexed loan-to-value ratio on the C&G
mortgage portfolio was 44 per cent and the average loan-to-value ratio for C&G
mortgage business written during the first half of 2003 was 65 per cent.  C&G
has continued its policies of not exceeding a 95 per cent loan-to-value ratio on
new lending, and of avoiding significant exposure to the buy-to-let and
sub-prime mortgage markets.

                                 Page 19 of 48

LLOYDS TSB GROUP

Insurance and Investments

(the life, pensions and unit trust businesses of Scottish Widows and Abbey Life;
general insurance underwriting and broking; and Scottish Widows Investment
Partnership)



                                                                                 Half-year to              Half-year to
                                                                                    30 June                 31 December
                                                                              2003             2002             2002
                                                                              GBPm             GBPm             GBPm
                                                                                                        

Life, pensions and unit trusts
  Scottish Widows                                                              194              308              280
  Abbey Life                                                                    41               57               35
  Provisions for customer redress                                             (100)               -             (205)
                                                                               135              365              110
General insurance                                                              355              386              367
Operating profit from Insurance                                                490              751              477
Scottish Widows Investment Partnership                                          (1)               6               (6)
Profit before tax *                                                            489              757              471

Profit before tax, before provisions for customer redress*                     589              757              676


*excluding changes in economic assumptions and investment variance

Profit before tax from Insurance and Investments,  excluding changes in economic
assumptions,  investment variance and provisions for customer redress, decreased
by GBP168 million, or 22 per cent, to GBP589 million, from GBP757 million in the
first  half of 2002,  partly as a result of a  reduction  of GBP101  million  in
benefits from experience  variances and assumption changes, and lower normalised
investment  earnings.  On the same  basis,  profit  before  tax  from our  life,
pensions and unit trust businesses  decreased by GBP130 million, or 36 per cent,
to GBP235 million. The market for medium and long-term  investments continued to
be adversely affected by uncertainties in global stock markets.

Total sales from the  Group's  life,  pensions  and unit trust  businesses  were
GBP1,992.2 million,  compared with GBP2,138.7 million in the first half of 2002,
a decrease of 7 per cent.  Overall weighted sales were GBP366.6 million compared
to GBP372.7  million in the first half of last year,  a reduction of 2 per cent.
This  decrease in  weighted  sales  reflected a 5 per cent  increase in weighted
sales from life and  pensions,  offset by a 22 per cent  reduction  in  weighted
sales from unit trusts and equity-based ISAs.

The Group's estimated market share of the life, pensions and unit trusts market
in the first quarter of 2003 was 5.4 per cent, compared with 4.6 per cent in the
first quarter of 2002, and in life and pensions, market share in the first
quarter of 2003 increased to 6.4 per cent, compared with 5.2 per cent in the
comparable period of 2002.  By distribution channel, weighted sales from
independent financial advisors (IFA) rose by 36 per cent as a result of strong
regular savings and pensions sales.  Our share of the IFA market in the first
quarter of 2003 increased to 5.4 per cent, compared with 3.4 per cent in the
comparable period of 2002.  In the branch network, weighted sales were 25 per
cent lower as a result of a significant reduction in the sales of single premium
investments.

                                 Page 20 of 48

LLOYDS TSB GROUP

Insurance and Investments (continued)

Sales through the branch network were also affected in the first half of 2003 by
significant restructuring activity in the personal sector regulated salesforce,
to reflect lower levels of new business and improve cost efficiency.  This led
to the reduction of almost one third of the regulated salesforce.  Scottish
Widows remains one of the leading unit trust and equity-based ISA providers in
the UK, with a growing market share.

In 2001, Scottish Widows was one of the first companies to be accredited under
the "Raising Standards" quality mark, which aims to raise standards generally
throughout the insurance industry to create an environment which encourages
consumers to provide for their own future.  In March 2003 Scottish Widows was
one of the first companies to gain re-accreditation under "Raising Standards",
confirming Scottish Widows' position at the forefront of industry-wide
initiatives to improve standards.

Profit  before  tax from  general  insurance  operations,  excluding  investment
variance,  decreased  by GBP31  million,  or 8 per cent,  to GBP355  million  as
continued  revenue  growth  from home  insurance  was offset by lower  levels of
creditor  insurance  reflecting the slowdown in growth in personal  loans.  With
over 9 million general  insurance  policies in force, we estimate that the Group
is the market leader in the distribution of home and creditor insurance.

The principal  focus of Scottish  Widows  Investment  Partnership  (SWIP) is the
delivery of  consistently  superior  investment  performance.  At the end of the
half-year  SWIP had GBP73  billion of funds under  management  out of  groupwide
funds  under  management  totalling  GBP99  billion.   Overall  fund  management
performance  continues  to show a  significant  improvement.  SWIP's  largest UK
equity fund,  the UK Growth Fund,  has  achieved a second  quartile  performance
within its sector over the last six months and top quartile over the last twelve
months.  The  improvement  in  performance  is also  reflected in each of SWIP's
mainstream,  actively  managed UK equity  funds,  which have all achieved  above
median  performance  over six month and twelve  month  periods,  with the GBP400
million UK Select  Growth  Fund being in the top  quartile  over the last twelve
months.  In  addition,  SWIP now has a total of 18  funds  rated A and  above by
Standard & Poor's,  with 5 new  ratings  awarded in the first half of 2003.  The
pre-tax loss from SWIP for the half-year was GBP1 million compared with a profit
of GBP6 million in the first half of 2002, the movement  reflecting lower income
as a result of lower equity markets and the impact of higher investment spend.

                                 Page 21 of 48


LLOYDS TSB GROUP

Insurance and Investments (continued)


                                                                               Half-year to              Half-year to
                                                                                  30 June                 31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Total new business premium income
Regular premiums:
Life - mortgage related                                                      21.7            16.0             19.0
       - non-mortgage related                                                28.0            14.0             18.7
Pensions                                                                    111.1           103.4            109.3
Health                                                                        3.2             2.9              3.0
Total regular premiums                                                      164.0           136.3            150.0

Single premiums:
Life                                                                        438.3           816.6            715.2
Annuities                                                                   271.4           180.1            316.9
Pensions                                                                    597.0           440.5            619.7
Total single premiums                                                     1,306.7         1,437.2          1,651.8

External unit trust sales:
Regular payments                                                             22.0            40.2             31.3
Single amounts                                                              499.5           525.0            484.5
Total external unit trust sales                                             521.5           565.2            515.8

Weighted sales (regular + 1/10 single)
Life and pensions                                                           294.7           280.0            315.2
Unit trusts                                                                  71.9            92.7             79.7
Life, pensions and unit trusts                                              366.6           372.7            394.9


Weighted sales by distribution channel

Branch network                                                              139.3           185.0            165.6
Independent financial advisors                                              197.5           145.4            190.0
Direct                                                                       28.9            31.6             36.3
International/Other                                                           0.9            10.7              3.0
Life, pensions and unit trusts                                              366.6           372.7            394.9

Group funds under management                                                GBPbn           GBPbn            GBPbn
Scottish Widows Investment Partnership                                         73              76               70
UK Wealth Management                                                           10              11               10
International                                                                  16              18               18
                                                                               99             105               98


                                 Page 22 of 48

LLOYDS TSB GROUP

Insurance and Investments (continued)

Life, pensions and unit trusts




                                                                              Half-year to                Half-year to
                                                                                 30 June                   31 December
                                                                         2003                2002               2002
                                                                         GBPm                GBPm               GBPm
                                                                                                        

New business income                                                       204                 182                216
Existing business
- expected return                                                         126                 127                146
- experience variances                                                      -                  18                (19)
- assumption changes and other items                                      (21)                 62                 16
- provisions for customer redress                                        (100)                  -               (205)
                                                                            5                 207                (62)
Investment earnings                                                        77                 113                101
Life and pensions distribution costs                                     (150)               (136)              (147)
                                                                          136                 366                108
Unit trusts                                                                30                  51                 39
Unit trust distribution costs                                             (31)                (52)               (37)
                                                                           (1)                 (1)                 2
Profit before tax*                                                         135                 365                110
Profit before tax, excluding provisions for
customer redress*                                                          235                 365                315

New business margin (life and pensions)                                   18.3%               16.4%              21.9%


*excluding changes in economic assumptions and investment variance

New business income increased by 12 per cent supported by a 5 per cent growth in
weighted sales from life and pensions products, and an improved performance in
the more profitable life products.  The life and pensions new business margin,
defined as new business income less distribution costs divided by weighted
sales, increased to 18.3 per cent, from 16.4 per cent in the first half of 2002.
The improvement largely arose from an improved product mix, particularly
higher margin protection and regular premium life products.

Profit  before tax from existing  business,  excluding  provisions  for customer
redress,  fell by 49 per  cent to  GBP105  million.  The  expected  return  from
existing  business,  which reflects the unwinding of the long-term discount rate
applied to the  expected  cash  flows from the  Group's  portfolio  of  in-force
business,  decreased by GBP1 million, to GBP126 million. This reduction reflects
the lower value of in-force  business at the  beginning  of the year and a lower
discount  rate  following the reduction  made in December  2002,  which offset a
lower level of restructuring costs.

                                 Page 23 of 48

LLOYDS TSB GROUP

Insurance and Investments (continued)

General Insurance



                                                                                Half-year to            Half-year to
                                                                                   30 June               31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Premium income from underwriting
Creditor                                                                       52              54               53
Home                                                                          198             165              185
Health                                                                         22              22               22
Re-insurance premiums                                                         (11)             (6)              (9)
                                                                              261             235              251
Commissions from insurance broking
Creditor                                                                      190             227              199
Home                                                                           14              19               25
Health                                                                          8               9                8
Other                                                                          77              78               82
                                                                              289             333              314

Profit before tax*                                                            355             386              367


*excluding investment variance

Profit before tax, excluding investment variance, from our general insurance
operations, comprising both underwriting and broking activities, decreased by
GBP31 million, or 8 per cent, to GBP355 million.

Premium income from  underwriting  increased by GBP26  million,  or 11 per cent,
largely as a result of higher home  insurance  income which  increased by 20 per
cent. Commissions from insurance broking,  however,  decreased by GBP44 million,
or 13 per cent,  largely  as a result of lower  levels  of  creditor  insurance,
reflecting the slowdown in growth in personal loans.

Sales from direct channels (direct mail, telephone, affinity and internet)
continue to grow strongly with 62 per cent of new home insurance policies and 84
per cent of new motor insurance policies being sold through direct channels in
the first half of 2003.  Lloyds TSB Insurance's presence on the Automobile
Association and Hill House Hammond insurance panels generated an additional
40,000 policies.

Claims  were GBP1  million  higher at GBP108  million  than in the first half of
2002.  The overall  claims ratio of 40 per cent was lower than in the first half
of last year (44 per cent) as portfolio growth exceeded the growth in claims.

With over 9 million policies in force as at 30 June 2003, an increase of 7 per
cent from 30 June 2002, Lloyds TSB is the largest distributor of personal lines
general insurance in the UK, and we estimate that the Group is the UK market
leader in the distribution of home and creditor insurance.

                                 Page 24 of 48


LLOYDS TSB GROUP

Wholesale Markets

(banking, treasury, large value lease finance, long-term agricultural finance,
share registration, venture capital, and other related services for major UK and
multinational companies, banks and financial institutions, and medium-sized UK
businesses; and Lloyds TSB Asset Finance)




                                                                                Half-year to            Half-year to
                                                                                   30 June               31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Net interest income                                                           574             579              597
Other income                                                                  518             447              528
Total income                                                                1,092           1,026            1,125
Operating expenses                                                            593             512              621
Trading surplus                                                               499             514              504
Provisions for bad and doubtful debts                                         108             151              160
Amounts written off fixed asset investments                                    23               9               48
Profit before tax                                                             368             354              296

Efficiency ratio                                                            54.3%           49.9%            55.2%
Total assets (period-end)                                               GBP92.1bn       GBP87.8bn        GBP89.5bn
Total risk-weighted assets (period-end)                                 GBP53.8bn       GBP49.7bn        GBP53.0bn


Wholesale  Markets pre-tax profit increased by GBP14 million,  or 4 per cent, to
GBP368  million  as  strong  profit  growth in Lloyds  TSB Asset  Finance  and a
reduction in provisions  for bad and doubtful  debts more than offset the impact
of the introduction of the Competition  Commission's  SME report  remedies,  and
lower income from Treasury.

Net  interest  income  decreased  by GBP5  million  reflecting  lower  income in
Treasury but also as a result of a reduction of some GBP20 million following the
implementation  of the  Competition  Commission's  SME  remedies.  Other  income
increased  by GBP71  million,  largely as a result of the  acquisition  of First
National  Vehicle Holdings and Abbey National Vehicle Finance in April 2002, and
the Dutton-Forshaw Group in December 2002. Operating expenses increased by GBP81
million,  compared  with the first half of last  year,  of which  GBP66  million
reflected the asset finance acquisitions.

The charge for provisions for bad and doubtful debts in Wholesale Markets
decreased by GBP43 million, despite a small increase in provisions within the
asset finance businesses reflecting portfolio growth.  In the first half of
2002, provisions against Group loans and advances to certain large US corporate
customers totalled some GBP70 million.  Amounts written off fixed asset
investments increased by GBP14 million.

Assets grew by 5 per cent to GBP92.1 billion, an increase of GBP4.3 billion,
reflecting growth in debt securities for structured transactions, and
relationship lending, in the second half of 2002, together with strong growth in
the asset finance businesses in the first half of 2003, partially offset by a
reduction in Treasury.

                                 Page 25 of 48

LLOYDS TSB GROUP

Wholesale Markets (continued)

Treasury  pre-tax  profits  decreased by 42 per cent to GBP68 million,  compared
with GBP117 million in the first half of 2002 reflecting less favourable trading
conditions,  lower  money  market  income  and finer  margins on  interest  rate
derivatives.

Strategic Asset Finance, incorporating Lloyds TSB Leasing, remains one of the
UK's leading large-ticket lessors.  In support of corporate customers, Capital
Markets improved market share in the UK loan syndications market, achieving
second place for the number and value of Lead Arranger roles for UK investment
grade companies.

Lloyds TSB Registrars' share of the registration market for FTSE 100 companies
was 57 per cent, and its market leadership in employee share administration
services was maintained.  Shareview Dealing, a telephone and internet based
retail sharedealing service, was launched in March, and Votenow, an electronic
voting system for AGMs was successfully launched in April.  However, low levels
of corporate transaction activity led to a reduction in pre-tax profits to GBP16
million, from GBP24 million in the first half of 2002.

Due to market conditions, Lloyds TSB Development Capital undertook significantly
lower levels of venture capital investment and, in a difficult market for
disposals, realisations of venture capital gains remained low.  Pre-tax losses
were GBP3 million, compared to a loss of GBP8 million in the first half of last
year.  However, record levels of new acquisition finance commitments were
achieved in the first half of 2003, with lower levels of provisions.

Pre-tax  profits in Lloyds TSB Asset  Finance,  which  incorporates  the Group's
point-of-sale asset finance and receivables finance businesses, increased by 144
per cent to GBP66 million, compared with GBP27 million in the first half of last
year. This reflects, in part, the acquisition of First National Vehicle Holdings
and Abbey National Vehicle Finance in April 2002, and the  Dutton-Forshaw  Group
in December 2002. These businesses have been successfully integrated into Lloyds
TSB Asset Finance,  where Lloyds TSB autolease is now the largest  contract hire
operator  in the UK,  and  expected  synergies  are on track  with  the  Group's
original plans. We continue to grow market share in motor finance,  in a buoyant
market.

The number of businesses using asset based finance continues to grow strongly,
and Lloyds TSB Commercial Finance and its specialist factoring division, Alex
Lawrie Factors, have been well positioned, growing market share in both invoice
discounting and factoring.  Data from The Factors and Discounters Association
confirms Lloyds TSB Commercial Finance's market leadership position.

                                 Page 26 of 48

LLOYDS TSB GROUP

International Banking

(banking and financial services overseas in three main areas: The Americas, New
Zealand, and Europe and Offshore Banking)




                                                                               Half-year to             Half-year to
                                                                                   30 June               31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Net interest income                                                           406             383              367
Other income                                                                  177             188              186
Total income                                                                  583             571              553
Operating expenses                                                            292             277              304
Trading surplus                                                               291             294              249
Provisions for bad and doubtful debts                                          40              63               99
Amounts written off fixed asset investments                                     1               -                -
                                                                              250             231              150
Loss on sale of businesses                                                    (15)              -                -
Profit before tax                                                             235             231              150

Efficiency ratio                                                            50.1%           48.5%            55.0%
Total assets (period-end)                                               GBP23.0bn       GBP21.4bn        GBP21.3bn
Total risk-weighted assets (period-end)                                 GBP15.3bn       GBP14.4bn        GBP14.2bn


International  Banking pre-tax profit increased by GBP4 million,  or 2 per cent,
to  GBP235  million,  notwithstanding  a GBP15  million  loss on the sale of the
Group's French wealth management  businesses,  and a GBP23 million profit on the
sale and leaseback of premises in the first half of 2002.

Net interest income increased by GBP23 million, or 6 per cent, to GBP406 million
reflecting  volume growth and exchange rate  movements in New Zealand,  together
with  strong  wholesale  margins  in Brazil.  Other  income  decreased  by GBP11
million, or 6 per cent, to GBP177 million reflecting lower equity market related
earnings in Offshore Banking and European Private  Banking.  Operating  expenses
increased by GBP15 million,  reflecting a combination  of volume  growth,  local
inflation,  and the impact of exchange rate  movements.  Provisions  for bad and
doubtful debts were GBP23 million lower reflecting the absence of an increase in
the general provision in Argentina.

Pre-tax  profits from The National Bank of New Zealand  increased by 34 per cent
to GBP147 million as a result of asset growth across all business sectors,  with
strong  lending  and  deposit  growth  within the  personal  and small  business
markets.  In a market  affected by high  interest  rates,  our consumer  finance
business in Brazil, Losango,  increased lending volumes and, with the benefit of
more favourable bond market conditions,  the Group's businesses in Brazil made a
pre-tax profit of GBP46  million,  compared with GBP32 million in the first half
of 2002.

                                 Page 27 of 48

LLOYDS TSB GROUP

International Banking (continued)

The Group's international wealth management businesses have been adversely
impacted by equity market volatility and depressed investor sentiment, although
the demand for services for UK expatriates working abroad remains strong.
Offshore Banking and European Private Banking pre-tax profits fell by GBP49
million to GBP55 million, compared with the first half of 2002, which benefited
from a GBP23 million profit on the sale and leaseback of premises.

The Group reduced its total  exposure to Brazil,  net of  provisions,  to GBP1.5
billion during the first half of 2003 (December 2002:  GBP1.9  billion)  largely
through the  disposal  of the  remaining  Brazilian  component  of the  emerging
markets debt portfolio.  The Brazilian Real appreciated 20.3 per cent in the six
months to 30 June 2003. Sentiment towards Brazil and Argentina has improved over
the period, but the economic situation continues to be difficult and the outlook
remains  uncertain.  The Group's  total  exposure to Argentina at the end of the
half-year was some GBP170  million,  net of provisions  and charges (31 December
2002: GBP190 million),  despite the impact of an appreciation of the Peso during
the six  months  to 30 June  2003,  largely  reflecting  emerging  markets  debt
portfolio sales, and the repayment of some offshore lending.

In May 2003 Lloyds TSB agreed the sale of its French fund management and private
banking  businesses,  including  its  subsidiaries,  Lloyds  Bank  SA,  Chaillot
Assurances  SA and  Capucines  Investissements  SA, to UBS  (France) SA. The net
asset value of businesses sold was  approximately  GBP20 million and funds under
management were approximately EUR1 billion. A net loss of GBP15 million has been
included in the profit and loss account.

In June 2003, the Group announced that, following approaches, Lloyds TSB is
considering its options relating to The National Bank of New Zealand.  The Group
is undertaking a strategic review so that potential offers for The National Bank
of New Zealand, as well as retention of the business, can be considered.

                                 Page 28 of 48

LLOYDS TSB GROUP

Central group items

(earnings on surplus capital and the emerging markets debt investment portfolio,
central costs and other unallocated items)



                                                                                   Half-year to           Half-year to
                                                                                      30 June              31 December
                                                                               2003           2002              2002
                                                                               GBPm           GBPm              GBPm
                                                                                                       

Accrual for payment to Lloyds TSB Foundations                                  (16)            (19)             (14)
Other finance income                                                            17              85               80
Earnings on surplus capital and the emerging markets debt
investment portfolio                                                           140             (23)             (82)
Central costs and other unallocated items                                      (21)             (4)             (19)
                                                                               120              39              (35)


The  four  independent  Lloyds  TSB  Foundations  support  registered  charities
throughout the UK that enable people,  particularly  disabled and disadvantaged,
to play a fuller  role in  society.  The  Foundations  receive 1 per cent of the
Group's  pre-tax profit,  averaged over three years,  instead of the dividend on
their  shareholdings,  making them in aggregate  one of the largest  independent
grant  giving  bodies in the UK. In the first  half of 2003,  the Group  accrued
GBP16 million for payment to the Lloyds TSB Foundations.

Other finance income represents income from the expected return on the Group's
pension fund assets less the charge for unwinding the discount on the pension
fund liabilities.  The significant reduction in income in the first half of 2003
reflects the combined impact of a reduction in the expected return on lower
pension scheme assets as a result of the continuing weakness in global equity
markets, and increased pension fund liabilities caused by the expected greater
lifespan of pension scheme members.

Earnings on surplus capital and the emerging  markets debt investment  portfolio
reflect  earnings  on  capital  held at the Group  centre and  profits  from the
Group's  investment  portfolio of emerging markets debt  securities.  During the
first half of 2003 improved  secondary bond market conditions  allowed the Group
to sell its  portfolio  of emerging  markets  debt  securities.  Profits on bond
sales, and certain closed foreign exchange positions,  in the first half of 2003
totalled  some  GBP295   million.   The  Group  will  not  achieve  any  further
contribution from the emerging markets debt portfolio in the second half of 2003
and beyond.

                                 Page 29 of 48

LLOYDS TSB GROUP

                                   INCOME

Group net interest income

Group net interest income increased by GBP14 million, or 1 per cent, to GBP2,571
million, despite a reduction of GBP203 million caused by a 26 basis point
reduction in the net interest margin.  The implementation of the Competition
Commission's SME report remedies reduced Group net interest income by GBP82
million, and the net interest margin by some 10 basis points, in the first half
of 2003.  Average interest-earning assets increased by 9 per cent to GBP172
billion.  Excluding the Competition Commission impact, the 16 basis points
decrease in the overall net interest margin reflected a lower contribution from
interest-free liabilities, partly caused by the fall in average interest rates,
and a reduction of 12 basis points in the interest spread.  Compared with the
net interest margin in the second half of 2002, there was a reduction of 12
basis points, of which some 10 basis points represented the Competition
Commission impact.  The mix effect from the higher levels of growth in the
mortgage portfolio and some mortgage margin erosion caused a 6 basis point
reduction.  This was partly offset by a 2 basis point improvement in the margin
in the asset finance businesses.



                                                                               Half-year to            Half-year to
                                                                                  30 June               31 December
                                                                            2003            2002             2002
                                                                            GBPm            GBPm             GBPm
                                                                                                     

Net interest income                                                         2,571           2,557            2,614

Average balances
Short-term liquid assets                                                    3,177           4,079            2,959
Loans and advances                                                        153,688         139,722          147,456
Debt securities                                                            15,217          13,859           15,493
Total interest-earning assets                                             172,082         157,660          165,908

Financed by:
Interest-bearing liabilities                                              164,454         145,667          154,665
Interest-free liabilities                                                   7,628          11,993           11,243

Average rates                                                                  %               %               %
Gross yield on interest-earning assets                                       5.87            6.58             6.46
Cost of interest-bearing liabilities                                         2.99            3.58             3.58
Interest spread                                                              2.88            3.00             2.88
Contribution of interest-free liabilities                                    0.13            0.27             0.25
Net interest margin                                                          3.01            3.27             3.13


Note:  Payments made under cash gift and discount mortgage schemes are amortised
over the early redemption charge period, being a maximum of five years. If these
incentives  had been fully  written  off as  incurred,  group and  domestic  net
interest  income would have been GBP35 million  higher in the first half of 2003
(2002 first half: GBP23 million higher;  second half: GBP32 million higher). The
deferred element of the expenditure  amounting to GBP166 million at 30 June 2003
(30 June 2002:  GBP233  million;  31 December 2002:  GBP201 million) is included
within prepayments and accrued income in the balance sheet.

                                 Page 30 of 48

LLOYDS TSB GROUP

Domestic net interest income

Domestic  net interest  income  increased by GBP11  million,  or 1 per cent,  to
GBP2,188  million,  notwithstanding a reduction of GBP196 million caused by a 30
basis point reduction in the net interest margin. This represents 85 per cent of
total group net interest income.

Average interest-earning assets increased by GBP14 billion, or 11 per cent, to
GBP144 billion.  Average personal lending and mortgage balances grew by GBP10
billion and wholesale balances increased by GBP4 billion.

The net interest margin decreased by 30 basis points reflecting a reduction in
the contribution of interest-free liabilities and the impact of the
implementation of the remedies suggested by the Competition Commission,
following its investigation into the supply of banking services to small and
medium size enterprises (SMEs), together with a reduction of 16 basis points in
the interest spread.  Compared with the net interest margin in the second half
of 2002, there was a reduction of 15 basis points, of which some 11 basis points
represented the Competition Commission impact.  A slight reduction in the margin
earned on the mortgage portfolio was partly offset by a higher margin in the
asset finance businesses.



                                                                                Half-year to          Half-year to
                                                                                   30 June             31 December
                                                                             2003            2002            2002
                                                                             GBPm            GBPm            GBPm
                                                                                                     

Net interest income                                                         2,188           2,177            2,248

Average balances
Short-term liquid assets                                                    2,384           2,830            2,390
Loans and advances                                                        131,812         119,950          127,256
Debt securities                                                            10,202           7,889            9,420
Total interest-earning assets                                             144,398         130,669          139,066

Financed by:
Interest-bearing liabilities                                              140,362         121,305          130,547
Interest-free liabilities                                                   4,036           9,364            8,519

Average rates                                                                  %               %                %
Gross yield on interest-earning assets                                       5.75            6.14             6.06
Cost of interest-bearing liabilities                                         2.77            3.00             3.04
Interest spread                                                              2.98            3.14             3.02
Contribution of interest-free liabilities                                    0.08            0.22             0.19
Net interest margin                                                          3.06            3.36             3.21


                                 Page 31 of 48

LLOYDS TSB GROUP

International net interest income

Net interest income from international  operations increased by GBP3 million, or
1 per cent, to GBP383  million.  This  represents 15 per cent of total group net
interest income.  Strong volume growth,  particularly in New Zealand, was offset
by the adverse effect of exchange rate movements.

Average interest-earning assets increased by 3 per cent but were flat on a local
currency basis.  The net interest margin reduced by 5 basis points as a result
of the sale of the Group's portfolio of emerging markets debt securities.
Compared with the net interest margin in the second half of 2002, there was an
increase of 9 basis points, reflecting stronger margins in our Latin American
businesses.



                                                                               Half-year to             Half-year to
                                                                                   30 June               31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Net interest income                                                           383             380              366

Average balances
Short-term liquid assets                                                      793           1,249              569
Loans and advances                                                         21,876          19,772           20,200
Debt securities                                                             5,015           5,970            6,073
Total interest-earning assets                                              27,684          26,991           26,842

Financed by:
Interest-bearing liabilities                                               24,092          24,362           24,118
Interest-free liabilities                                                   3,592           2,629            2,724

Average rates                                                                  %               %               %
Gross yield on interest-earning assets                                       6.51            8.71             8.55
Cost of interest-bearing liabilities                                         4.28            6.51             6.51
Interest spread                                                              2.23            2.20             2.04
Contribution of interest-free liabilities                                    0.56            0.64             0.66
Net interest margin                                                          2.79            2.84             2.70




                                 Page 32 of 48

LLOYDS TSB GROUP

Other income



                                                                               Half-year to             Half-year to
                                                                                  30 June                31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

Fees and commissions receivable:
  UK current account fees                                                     316             282              297
  Other UK fees and commissions                                               569             583              580
  Insurance broking                                                           289             333              314
  Card services                                                               213             198              216
  International fees and commissions                                          122             127              123
                                                                            1,509           1,523            1,530
Fees and commissions payable                                                 (346)           (306)            (339)
Dealing profits (before expenses):
  Foreign exchange income                                                     149              82               91
  Securities and other gains                                                  278               6                9
                                                                              427              88              100
Income from long-term assurance business                                      175              23             (326)
General insurance premium income                                              261             235              251
Other operating income                                                        320             392              371
Total other income                                                          2,346           1,955            1,587


Other income increased by GBP391 million, or 20 per cent, to GBP2,346 million.

Fees and commissions receivable decreased slightly to GBP1,509 million,  largely
reflecting  lower  income from  insurance  broking  and unit trust  commissions,
partly offset by good growth in UK current account fees and card services. Other
UK fees and  commissions  decreased by GBP14  million,  or 2 per cent, to GBP569
million  as a result  of a GBP26  million  reduction  in unit  trust  and  asset
management fees, offset by an increase of GBP6 million in mortgage related fees.
There  was  also a GBP6  million  increase  in fees  from  large  corporate  and
factoring activity reflecting increased transaction volumes.

Insurance broking  commission  income decreased by GBP44 million,  compared with
the  first  half  of  2002,  reflecting  lower  creditor  insurance  commissions
resulting from the slowdown in the rate of growth of personal loans. Income from
credit and debit card services increased by GBP15 million, mainly as a result of
higher merchant  service charges and fees. UK current account fee income rose by
GBP34 million,  reversing the downward trend experienced in recent years largely
as a result of an increase in fee income from added value current accounts.

Fees and commissions  payable  increased by GBP40 million against the first half
of  last  year  as  a  result  of  higher  reciprocity  fees,  increased  dealer
commissions in Lloyds TSB Asset  Finance,  an increase in package costs relating
to a number of  products,  and  higher  costs  relating  to legal  expenses  and
valuation fee incentives supporting the strong mortgage growth.

                                 Page 33 of 48

LLOYDS TSB GROUP

Other income (continued)

Dealing  profits  increased  substantially  by GBP339 million  compared with the
first  half of 2002 as a result  of an  increase  of GBP67  million  in  foreign
exchange  income and an  increase  of GBP272  million  in gains from  securities
trading, largely reflecting earnings from the portfolio of emerging markets debt
investments  which, at the end of 2002, was reclassified as a trading portfolio.
In 2002, earnings from emerging markets debt investments were primarily reported
within  other  operating  income.   Income  from  long-term  assurance  business
increased  by GBP152  million,  largely  reflecting  the absence of the negative
investment  variance  reported in the first half of 2002.  Excluding  changes in
economic  assumptions and investment  variance,  income from long-term assurance
business was GBP253 million  lower,  reflecting a reduction of GBP101 million in
benefits  from  experience  variances and actuarial  assumption  changes,  and a
GBP100 million provision for customer redress.

Other operating income decreased by GBP72 million to GBP320 million,  reflecting
the  reclassification  of  earnings  on the  emerging  markets  debt  investment
portfolio in 2003 into dealing profits, and the non-recurrence of profits on the
sale and leaseback of premises which, in the first half of 2002,  totalled GBP23
million. These decreases more than offset a GBP42 million increase following the
acquisition of the  Dutton-Forshaw  Group in December 2002, and higher operating
lease rentals  following the acquisition of First National  Vehicle Holdings and
Abbey National Vehicle Finance.

                                 Page 34 of 48


LLOYDS TSB GROUP

                              OPERATING EXPENSES




Operating expenses
                                                                               Half-year to             Half-year to
                                                                                  30 June                31 December
                                                                             2003           2002             2002
                                                                             GBPm           GBPm             GBPm
                                                                                                     

Administrative expenses:
Staff:
  Salaries and profit sharing                                                 900             879              879
  National insurance                                                           72              71               63
  Pensions                                                                    160             148              170
  Restructuring                                                                10              36               69
  Other staff costs                                                           113              94              108
                                                                            1,255           1,228            1,289
Premises and equipment:
  Rent and rates                                                              142             137              143
  Hire of equipment                                                            10              10                8
  Repairs and maintenance                                                      63              59               72
  Other                                                                        60              63               51
                                                                              275             269              274
Other expenses:
  Communications and external data processing                                 213             215              231
  Advertising and promotion                                                    86              81               66
  Professional fees                                                            53              41               72
  Provisions for customer redress                                             200               -                -
  Other                                                                       205             206              242
                                                                              757             543              611
Administrative expenses                                                     2,287           2,040            2,174
Depreciation                                                                  318             299              343
Amortisation of goodwill                                                       24              21               38
Total operating expenses                                                    2,629           2,360            2,555

Efficiency ratio                                                            53.3%           51.3%            59.7%
Efficiency ratio, excluding changes in economic assumptions,
investment variance and provisions for customer redress                     48.6%           47.2%            51.3%



Total operating expenses increased by GBP269 million, or 11 per cent, compared
with the first half of 2002.  Excluding the impact of acquisitions, which
increased operating expenses by GBP99 million in the first half of 2003 compared
to GBP22 million in the first half of 2002, and a GBP200 million provision for
customer redress, operating expenses were broadly flat.

                                 Page 35 of 48



LLOYDS TSB GROUP

Operating expenses (continued)

Excluding provisions for customer redress,  administrative expenses increased by
GBP47  million to GBP2,087  million.  Staff costs were GBP27  million  higher at
GBP1,255  million,  and other  expenses  increased  by GBP14  million  to GBP557
million.  Depreciation  rose by GBP19  million,  reflecting an increase of GBP22
million in operating lease depreciation,  partly acquisition  related.  Goodwill
amortisation was GBP3 million higher. The efficiency ratio, excluding changes in
economic  assumptions,  investment variance and provisions for customer redress,
was 48.6 per cent, compared to 47.2 per cent in the first half of 2002.

The Group remains committed to strict cost control and, largely as a result of
continuing efficiency initiatives, we expect that the Group's operating expenses
in 2003, excluding the impact of acquisitions, operating lease depreciation and
provisions for customer redress, will grow by no more than the rate of
inflation.  This focus on cost control will be continued notwithstanding further
significant investment throughout the business in 2003, to support increased
business volumes, higher levels of service quality, further improvements in
productivity, and increases in investment in mandatory projects.  These include
projects such as the Universal Banking Service, anti-money laundering financial
crimes programmes and preparation for the forthcoming introduction of the Basel
2 capital accord.

Number of employees (full-time equivalent)

Staff numbers increased by 171 to 79,708 during the half-year.

Within UK Retail Banking and Mortgages staff numbers increased by 445,
reflecting planned improvements to customer service and a substantial increase
in our branch sales activities, partially offset by reductions of staff numbers
in back office operations.  In International Banking staff numbers decreased by
220, partly as a result of the disposal of the Group's French wealth management
businesses.



                                                                                        30 June          31 December
                                                                                          2003                2002
                                                                                                         

UK Retail Banking and Mortgages                                                          48,214              47,769
Insurance and Investments                                                                 6,129               6,170
Wholesale Markets                                                                        11,459              11,446
International Banking                                                                    11,507              11,727
Other                                                                                     2,399               2,425
Total number of employees (full-time equivalent)                                         79,708              79,537



                                 Page 36 of 48

LLOYDS TSB GROUP

                                CREDIT QUALITY



Charge for bad and doubtful debts

                                                                                Half-year to             Half-year to
                                                                                   30 June                31 December
                                                                             2003            2002             2002
                                                                             GBPm            GBPm             GBPm
                                                                                                      

UK Retail Banking and Mortgages                                               335             270              293
Wholesale Markets                                                             108             151              160
International Banking                                                          40              63               99
Central group items                                                           (13)             (5)              (2)
Total charge                                                                  470             479              550


Specific provisions                                                           466             451              514
General provisions                                                              4              28               36
Total charge                                                                  470             479              550

Charge as % of average lending:                                                %               %                %
Domestic                                                                     0.70            0.67             0.72
International                                                                0.41            1.22             1.32
Total charge                                                                 0.66            0.75             0.80



The total charge for bad and  doubtful  debts  decreased to GBP470  million from
GBP479 million.  In UK Retail Banking the provisions  charge  increased by GBP68
million,  from GBP272 million in the first half of 2002, to GBP340 million, as a
result of volume  related  asset  growth in the  personal  loan and credit  card
portfolios,  but also as a result of a higher  charge for fraud in the  personal
lending portfolios. In Mortgages an improved arrears position and the beneficial
effect of house price increases  resulted in a GBP5 million  provisions  release
for the half-year. In Wholesale Markets the provisions charge decreased by GBP43
million to GBP108  million  from  GBP151  million in the first half of 2002.  In
International Banking,  provisions decreased by GBP23 million as a result of the
absence of an increase in the general provision in Argentina.

Non-performing  loans  increased  to GBP1,513  million  compared  with  GBP1,414
million in December 2002,  largely  reflecting  higher levels of  non-performing
lending  in  the  Group's  corporate  portfolio  and  general  portfolio  growth
throughout  the Group.  In UK Retail  Banking and Mortgages the overall  arrears
position  remained stable.  Non-performing  lending  represented 1.0 per cent of
total  lending,  unchanged from December  2002.  Our lending  portfolio  remains
heavily influenced by our high quality,  relatively low risk,  mortgage business
and,  as a  result,  we remain  relatively  well  positioned  to  withstand  any
continued economic slowdown.

                                 Page 37 of 48

LLOYDS TSB GROUP

Movements in provisions for bad and doubtful debts




                                  Half-year to                      Half-year to                      Half-year to
                                  30 June 2003                      30 June 2002                    31 December 2002
                            Specific          General         Specific        General           Specific        General
                               GBPm             GBPm            GBPm            GBPm              GBPm            GBPm
                                                                                                  

At beginning of period        1,334              433           1,099             369             1,167              399
Exchange and other               12                -             (38)              2               (17)              (2)
adjustments
Advances written off           (514)               -            (444)              -              (434)               -
Recoveries of advances           87                -              99               -               104                -
written off in previous
years
Charge to profit and
loss account:
New and additional              769                4             756              28               788               36
provisions
Releases and recoveries        (303)               -            (305)              -              (274)               -
                                466                4             451              28               514               36
At end of period              1,385              437           1,167             399             1,334              433
                                      1,822                            1,566                             1,767
Closing provisions as %
of lending (excluding
unapplied interest)
Specific:
Domestic                      1,081            (0.9%)            899           (0.8%)            1,016            (0.8%)
International                   304            (1.6%)            268           (1.5%)              318            (1.7%)
                              1,385            (0.9%)          1,167           (0.9%)            1,334            (1.0%)
General                         437            (0.3%)            399           (0.3%)              433            (0.3%)
Total                         1,822            (1.2%)          1,566           (1.2%)            1,767            (1.3%)


At the end of June 2003 provisions for bad and doubtful debts totalled  GBP1,822
million.  This represented 1.2 per cent of total lending (December 2002: 1.3 per
cent).  Non-performing  lending  increased  to GBP1,513  million  from  GBP1,414
million in December 2002,  largely  reflecting  higher levels of  non-performing
lending  in the  Group's  corporate  portfolio,  and  general  portfolio  growth
throughout the Group. At the end of the half-year,  total provisions represented
over 120 per cent of non-performing loans (December 2002: 120 per cent).

                                 Page 38 of 48

LLOYDS TSB GROUP

                                CAPITAL RATIOS



Risk asset ratios

                                                                                        30 June          31 December
                                                                                          2003               2002
                                                                                          GBPm                GBPm
                                                                                                         

Capital
Tier 1                                                                                   10,355               9,490
Tier 2                                                                                    9,287               8,846
                                                                                         19,642              18,336

Supervisory deductions                                                                   (6,786)             (6,588)

Total capital                                                                            12,856              11,748


Risk-weighted assets                                                                      GBPbn               GBPbn
UK Retail Banking and Mortgages                                                            57.7                54.2
Insurance and Investments                                                                   0.2                 0.2
Wholesale Markets                                                                          53.8                53.0
International Banking                                                                      15.3                14.2
Central group items                                                                         0.5                 0.8
Total risk-weighted assets                                                                127.5               122.4

Risk asset ratios
Total capital                                                                             10.1%                9.6%
Tier 1                                                                                     8.1%                7.8%



                                                                                       Half-year            Half-year
                                                                                       to 30 June        to 31 December
                                                                                          2003                2002

Post-tax return on average risk-weighted assets                                           1.91%               1.18%


At the end of June 2003 the risk asset ratios were 10.1 per cent for total
capital and 8.1 per cent for tier 1 capital.

During the first half of 2003, total capital for regulatory  purposes  increased
by GBP1,108  million to GBP12,856  million.  Tier 1 capital  increased by GBP865
million,  mainly  from  retained  profits.  Tier 2 capital  increased  by GBP441
million, as a result of the issue of new tier 2 capital instruments. Supervisory
deductions  increased  by  GBP198  million,  as a result of an  increase  in the
Group's  embedded value to GBP6,362  million,  from GBP6,228 million in December
2002.

Risk-weighted  assets  increased  by 4 per  cent  to  GBP127.5  billion  and the
post-tax return on average risk-weighted assets increased to 1.91 per cent.

                                 Page 39 of 48


LLOYDS TSB GROUP

                     OVERVIEW OF CONSOLIDATED BALANCE SHEET

Review of balance sheet at 30 June 2003, compared to 31 December 2002

Assets

Total assets  increased  by  GBP11,921  million,  or 5 per cent,  to  GBP264,679
million, largely reflecting business growth.

Cash and balances at central  banks reduced by GBP283  million,  or 25 per cent,
from GBP1,140 million as cash balances held at the year end are usually high, to
cater for anticipated  demand over the year-end  holiday period.  Treasury bills
and other eligible  bills  increased to GBP3,577  million from GBP2,409  million
reflecting liquidity management. Loans and advances to banks increased by GBP777
million to GBP18,306  million  partly for  liquidity  management  purposes,  and
partly as a result of an increase in the value of collateral loans in treasury.

Loans and advances to customers increased by GBP7,516 million, or 6 per cent, to
GBP141,990 million.  This growth in loans and advances to customers largely
reflects growth in UK retail lending, particularly the strong mortgage growth in
the first half of 2003.




                                                                                    30 June               31 December
                                                                             2003             2002             2002
                                                                             GBPm             GBPm             GBPm
                                                                                                       

Loans and advances to customers
Domestic:
Agriculture, forestry and fishing                                            2,089            2,096            2,076
Manufacturing                                                                3,572            3,626            3,373
Construction                                                                 1,634            1,376            1,482
Transport, distribution and hotels                                           4,915            4,574            4,696
Property companies                                                           4,222            3,277            4,008
Financial, business and other services                                       8,351            8,480            8,352
Personal  : mortgages                                                       67,316           58,614           62,467
          : other                                                           15,762           14,093           14,931
Lease financing                                                              6,940            7,372            7,285
Hire purchase                                                                6,489            5,708            5,990
Other                                                                        3,499            3,092            3,397
Total domestic                                                             124,789          112,308          118,057
International:
Latin America                                                                1,470            1,914            1,591
New Zealand                                                                 11,939            9,866           10,447
Rest of the world                                                            5,657            6,009            6,202
Total international                                                         19,066           17,789           18,240
                                                                           143,855          130,097          136,297
Provisions for bad and doubtful debts*                                      (1,808)          (1,565)          (1,766)
Interest held in suspense*                                                     (57)             (54)             (57)
Total loans and advances to customers                                      141,990          128,478          134,474



*figures exclude  provisions and interest held in suspense relating to loans and
advances to banks

                                 Page 40 of 48

LLOYDS TSB GROUP

Assets (continued)

Debt securities  decreased by GBP632 million to GBP28,682 million as a reduction
of GBP1.1 billion on sales of emerging market debt investments was partly offset
by increased holdings for liquidity management purposes.

Intangible  fixed  assets  declined  by GBP19  million  to  GBP2,615  million as
amortisation of GBP24 million and the reduction of GBP10 million due to the sale
of the Group's  French wealth  management  businesses  was  partially  offset by
positive  exchange  rate  movements,  principally  relating  to our New  Zealand
business.  Tangible  fixed  assets fell by GBP122  million to  GBP3,974  million
reflecting  depreciation of GBP318 million  partially offset by net additions of
GBP196 million.

Other  assets  increased  by GBP368  million to GBP5,631  million,  largely as a
result of increases in mark-to-market balances in respect of derivatives, higher
settlement  balances in treasury in respect of securities sales, and an increase
in card settlement balances.

Long-term assurance business attributable to the shareholder increased by GBP134
million to GBP6,362 million  reflecting the after tax profit in the Group's life
assurance  businesses  for  the  year to date  of  GBP132  million,  and a small
exchange gain from the life operations of The National Bank of New Zealand.

Liabilities

Deposits by banks have fallen by GBP1,561 million to GBP23,882 million as direct
borrowing from banks has been replaced by the issue of debt securities.

Customer deposits  increased by GBP5,099 million to GBP121,433 million partly as
a result of growth of GBP1.4 billion in current account credit balances. Savings
and investment  accounts grew by GBP3.0 billion,  and currency  deposits grew by
GBP1.0 billion reflecting strong growth in New Zealand.



                                                                                 30 June                 31 December
                                                                           2003            2002              2002
                                                                           GBPm            GBPm              GBPm
                                                                                                     

Deposits - customer accounts
Sterling:
Non-interest bearing current accounts                                       2,420           5,904            2,211
Interest bearing current accounts                                          26,815          21,673           25,640
Savings and investment accounts                                            56,195          50,975           53,223
Other customer deposits                                                    16,242          17,395           16,521
Total sterling                                                            101,672          95,947           97,595
Currency                                                                   19,761          17,840           18,739
Total deposits -  customer accounts                                       121,433         113,787          116,334




                                 Page 41 of 48

LLOYDS TSB GROUP

Liabilities (continued)

Debt securities in issue were up GBP4,243 million to GBP34,498 million partly as
a result of an increase in funding to replace  deposits  from banks,  and higher
balances in structured  finance  transactions.  In addition,  debt securities in
issue  in New  Zealand  increased  by  GBP0.7  billion  to  fund  balance  sheet
expansion.

Other  liabilities  increased  by GBP138  million to GBP8,427  million.  A lower
interim  dividend  accrual than that for the final dividend was offset by higher
settlement balances in respect of securities sales. Accruals and deferred income
reduced  by GBP217  million  to  GBP3,479  million  largely as a result of lower
interest  payable.  The  post-retirement  benefit  liability  increased by GBP91
million to GBP2,168 million as a result of the current year net pension cost. In
provisions for  liabilities  and charges,  deferred tax fell by GBP46 million to
GBP1,271  million,  largely  reflecting  a reduction  arising from the sale of a
portfolio  of finance  leases.  Other  provisions  for  liabilities  and charges
increased  by  GBP171  million  to  GBP532  million   principally   due  to  the
establishment  of a new  provision  for  customer  redress,  offset  by a  small
reduction in vacant leasehold property provisions in the UK.

Subordinated  liabilities  increased  by GBP628  million  to  GBP10,796  million
largely as a result of a new issue of undated loan capital to fund balance sheet
expansion and replace existing issues approaching maturity.

Minority interests increased by GBP12 million to GBP743 million reflecting the
minority share of profit after tax, and positive exchange rate movements, partly
offset by the payment of dividends to minority shareholders.

Shareholders'  funds were up GBP684 million to GBP8,656 million  principally due
to retentions.

                                 Page 42 of 48

LLOYDS TSB GROUP

                                    NOTES

1.       Accounting policies and presentation

         Accounting policies are unchanged from 2002.

         The Group has not revised the valuation of its pension schemes to
         reflect the circumstances prevailing at 30 June 2003.  In accordance
         with FRS 17 the valuations will be formally updated at the year-end.

2.       Economic profit

         In pursuit of our aim to maximise shareholder value, we use a system of
         value based management as a framework to identify and measure value in
         order to help us make better business decisions.  Accounting profit is
         of limited use as a measure of value creation and performance as it
         ignores the cost of the equity capital that has to be invested to
         generate the profit.  We choose economic profit as a measure of
         performance because it captures both growth in investment and return.
         Economic profit represents the difference between the earnings on
         the equity invested in a business and the cost of the equity.  Our
         calculation of economic profit uses average equity for the half-year
         and is based on a cost of equity of 9 per cent (2002: 9 per cent).

         Economic profit instils a rigorous financial discipline in determining
         investment decisions throughout the Group.  It enables us to evaluate
         alternative strategies objectively, with a clear understanding of the
         value created by each strategy, and then to select the strategy which
         creates the greatest value.



                                                                             Half-year to               Half-year to
                                                                                 30 June                 31 December
                                                                           2003             2002             2002
                                                                           GBPm             GBPm             GBPm

                                                                                                     
        Average shareholders' equity                                        8,301           10,748           10,590

        Profit attributable to shareholders                                 1,155            1,113              668
        Less: notional charge                                                (370)            (480)            (480)
         Economic profit                                                      785              633              188


         The notional charge has been calculated by multiplying average
         shareholders' equity by the cost of equity.  The reduction in average
         shareholders' equity in the first half of 2003 largely reflects
         actuarial losses in the Group's pension schemes recognised at the end
         of 2002.

                                 Page 43 of 48

LLOYDS TSB GROUP

3.       Earnings per share




                                                                               Half-year to              Half-year to
                                                                                  30 June                 31 December
                                                                          2003               2002             2002
                                                                                                     

         Basic

         Profit attributable to shareholders                            GBP1,155m        GBP1,113m          GBP668m
         Weighted average number of ordinary shares in issue               5,581m           5,562m           5,578m
         Earnings per share                                                 20.7p            20.0p            12.0p

         Fully diluted

         Profit attributable to shareholders                            GBP1,155m        GBP1,113m          GBP668m
         Weighted average number of ordinary shares in issue               5,617m           5,601m           5,593m
         Earnings per share                                                 20.6p            19.9p            11.9p


4.       Tax

         The effective rate of tax was 29.2 per cent (2002 first half: 28.8 per
         cent). The lower effective rate of tax, compared with the standard tax
         rate of 30 per cent, is primarily due to tax relief on tier 1 capital
         interest payments, and a lower effective rate of tax in the Group's
         life and pensions businesses.

         A reconciliation of the charge that would result from applying the
         standard UK corporation tax rate to profit before tax to the tax charge
         for the half-year, is given below:


                                                                               Half-year to             Half-year to
                                                                                  30 June                31 December
                                                                           2003              2002             2002
                                                                           GBPm              GBPm             GBPm
                                                                                                      

         Profit on ordinary activities before tax                          1,677             1,604            1,003

         Tax charge thereon at UK corporation tax rate of 30%                503               481              301
         Factors affecting charge:
         Goodwill amortisation                                                 5                 4                5
         Overseas tax rate differences                                         3                18                6
         Non-allowable and non-taxable items                                  (7)              (24)             (16)
         Gains exempted or covered by capital losses                           1                (6)             (17)
         Tax deductible coupons on non-equity minority interests              (6)               (6)              (6)
         Payments to employee trust                                            -               (10)             (10)
         Life companies rate differences                                     (10)                5               39

         Tax charge                                                          489               462              302


                                 Page 44 of 48


LLOYDS TSB GROUP

5.       Investment variance

         In accordance with generally accepted accounting practice in the UK, it
         is the Group's accounting policy to carry the investments comprising
         the reserves held by its life companies at market value. The reserves
         held to support the with-profits business of Scottish Widows are
         substantial and changes in market values will result in significant
         volatility in the Group's embedded value earnings, which are beyond the
         control of management.  Consequently, in order to provide a clearer
         representation of the underlying performance, the results of
         the life and pensions business are separately analysed to include
         investment earnings calculated using longer-term investment rates of
         return, and annual management charges based on unsmoothed fund values.
         This investment variance represents the difference between the actual
         investment return in the year on investments backing shareholder funds
         and the expected return based upon the economic assumptions made at the
         beginning of the year, and the effect of these fluctuations on the
         value of in-force business.  The effects of other changes in
         economic circumstances beyond the control of management are also
         reflected in the investment variance.  The longer-term rates of return
         for the period are consistent with those used by the Group in the
         calculation of the embedded value at the beginning of the period, which
         were 7.10 per cent for equities and 4.50 per cent for gilts.

         Lloyds TSB General Insurance also holds investments to support its
         underwriting business; these are carried at market value and gains and
         losses included within dealing profits.  Consistent with the approach
         adopted for the life and pensions business, an operating profit for the
         general insurance business is calculated including investment earnings
         normalised using the same long-term rates of return.

         During the first half of 2003 the FTSE All-Share index rose by 4 per
         cent and this created a positive investment variance totalling
         GBP42 million.

6.       Changes in economic assumptions

         In accordance with the Association of British Insurers' detailed
         guidance for the preparation of figures using the achieved profits
         method of accounting the Group has reviewed the economic assumptions
         used in the embedded value calculations.  The guidance requires that
         the assumptions should be reviewed at each reporting date.

The main economic assumptions were revised at 30 June 2003 as follows:



                                                                                    30 June            31 December
                                                                                      2003                2002
                                                                                        %                   %
                                                                                                     

Risk-adjusted discount rate (net of tax)                                               7.35                7.35
Return on equities (gross of tax)                                                      7.10                7.10
Return on fixed interest securities (gross of tax)                                     4.50                4.50
Expenses inflation                                                                     3.50                3.30



                                 Page 45 of 48

LLOYDS TSB GROUP

6.       Changes in economic assumptions (continued)

         At 30 June 2003 the review of the assumptions has led to an increase in
         the rate of expense inflation to 3.50 per cent.  This has resulted in a
         charge to the profit and loss account in the first half of 2003 of
         GBP8 million.

7.       Free Asset Ratio

         The free asset ratio is a common measure of financial strength in the
         UK for long-term insurance businesses.  It is the ratio of assets less
         liabilities (including actuarial reserves but before the required
         regulatory minimum solvency margin) expressed as a percentage of the
         liabilities.  At 30 June 2003, the free asset ratio of Scottish Widows
         plc was an estimated 12.7 per cent, compared with 12.2 per cent at
         31 December 2002.  After adjusting for the required regulatory minimum
         solvency margin, the Scottish Widows plc ratio, expressed as a
         percentage of total assets, was an estimated 7.7 per cent at 30
         June 2003, compared with 7.3 per cent at 31 December 2002.

8.       Reconciliation of movements in shareholders' funds




                                                                                Half-year to          Year ended
                                                                                    30 June           31 December
                                                                                      2003                 2002
                                                                                      GBPm                 GBPm
                                                                                                     

Profit attributable to shareholders                                                  1,155                1,781
Dividends                                                                             (597)              (1,908)
Profit (loss) for the period                                                           558                 (127)
Currency translation differences on foreign
currency net investments                                                               100                   (3)
Actuarial losses recognised in post-retirement benefit schemes                           -               (2,331)
Issue of shares                                                                         26                   77
Net increase (decrease) in shareholders' funds                                         684               (2,384)
Shareholders' funds at beginning of period                                           7,972               10,356
Shareholders' funds at end of period                                                 8,656                7,972




                                 Page 46 of 48

LLOYDS TSB GROUP

9.       Dividend

         An interim dividend for 2003 of 10.7p per share (2002: 10.7p), will be
         paid on 8 October 2003.

         Shareholders who have already joined the dividend reinvestment plan
         will automatically receive shares instead of the cash dividend.
         Shareholders who have not joined the plan and wish to do so may obtain
         an application form from Lloyds TSB Registrars, The Causeway, Worthing,
         West Sussex, BN99 6DA (telephone 0870 6003990).  Key dates for the
         payment of the dividend are:


Shares quoted ex-dividend.  Shares purchased before this date          13 August
qualify for the dividend

Record date.  Shareholders on the register on this date are            15 August
entitled to the dividend

Final date for joining or leaving the dividend reinvestment plan    10 September

Interim dividend paid                                                  8 October

10.     Other information

        Results for the half-year ended 30 June were approved by the directors
        on 31 July 2003.

        Statutory accounts for the year ended 31 December 2002 were delivered to
        the registrar of companies.  The auditors' report on these accounts was
        unqualified and did not include a statement under sections 237(2)
        (accounting records or returns inadequate or accounts not agreeing with
        records and returns) or 237(3) (failure to obtain necessary information
        and explanations) of the Companies Act 1985.

                                 Page 47 of 48

LLOYDS TSB GROUP

                                    CONTACTS

                    For further information please contact:-

                                 Philip Hampton
                             Group Finance Director
                              Lloyds TSB Group plc
                                 020 7356 1436
                   E-mail: philip.hampton@ltsb-finance.co.uk

                                 Michael Oliver
                         Director of Investor Relations
                              Lloyds TSB Group plc
                                 020 7356 2167
                   E-mail: michael.oliver@ltsb-finance.co.uk

                                Terrence Collis
                   Director of Group Corporate Communications
                              Lloyds TSB Group plc
                                 020 7356 2078
                    E-mail: terrence.collis@lloydstsb.co.uk

Copies of this news release may be obtained from Investor Relations, Lloyds TSB
Group plc, 25 Gresham Street, London, EC2V 7HN.  The full news release can also
be found on the Group's website - www.lloydstsb.com.

Information about the Group's role in the community and copies of the Group's
code of business conduct and its environmental report may be obtained by writing
to Public Affairs, Lloyds TSB Group plc, 25 Gresham Street, London, EC2V 7HN.
This information is also available on the Group's website.

                                 Page 48 of 48


                                   Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                              LLOYDS TSB GROUP plc
                                  (Registrant)



                                    By:       M D Oliver

                                    Name:     M D Oliver

                                    Title:    Director of Investor Relations



Date:     August 1, 2003