UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549 
Amendment No. 1 to
SCHEDULE TO

(RULE 14d-100)
TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR 13(e)(1) OF THE SECURITIES EXCHANGE ACT OF 1934

LLOYDS BANKING GROUP PLC
LBG CAPITAL NO. 1 PLC
LBG CAPITAL NO. 2 PLC
(Names of Subject Companies (Issuers))
 
LLOYDS BANKING GROUP PLC
(Name of Filing Person (Offeror))
 
LBG Capital No. 1 plc 7.875% Dated Enhanced Capital Notes due 2020 (ISIN XS0459093521 and XS0459093794)
LBG Capital No. 2 plc 7.875% Dated Enhanced Capital Notes due 2020 (ISIN XS0496068429)
LBG Capital No. 1 plc 8.00% Fixed-to-Floating Rate Undated Enhanced Capital Notes (ISIN XS0473106283 and XS0471767276)
LBG Capital No. 1 plc 8.50% Fixed-to-Floating Rate Undated Enhanced Capital Notes (ISIN XS0473103348 and XS0471770817)
 
(Title and CUSIP No. of Class of Securities) 
Lloyds Banking Group plc
25 Gresham Street
London EC2V 7HN
United Kingdom
011-44-207-626-1500
 
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Filing Person)
 
Copies to:
 
John W. Banes
Davis Polk & Wardwell London LLP
99 Gresham Street
London EC2V 7NG
United Kingdom
Tel. No.: 011-44-207-418-1300
 
CALCULATION OF FILING FEE
Transaction Valuation*
Amount of Filing Fee
$1,669,481,330(1)
$215,029.19(2)
(1)
Estimated solely for the purpose of calculating the filing fee in accordance with Rules 0-11(a)(4) and 0-11(b)(2) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and based on the market value of the ECNs (as defined below) calculated as the sum of (i) the product of (a) 105.500%, the average of the high and low as a percentage of par value of the 7.875% Dated Enhanced Capital Notes due 2020, issued by LBG Capital No. 1 plc and fully and unconditionally guaranteed by LBG (as defined below) (the “Series 1 ECNs”) on March 3, 2014, and (b) $985,636,000, the maximum amount of Series 1 ECNs that could be exchanged in the Exchange Offer (as defined below), (ii) the product of (a) 106.188%, the average of the high and low as a percentage of par value of the 7.875% Dated Enhanced Capital Notes due 2020, issued by LBG Capital No. 2 plc and fully and unconditionally guaranteed by Lloyds Bank plc (the “Series 4 ECNs”) on March 3, 2014, and (b) $407,578,000, the maximum amount of Series 4 ECNs that could be exchanged in the Exchange Offer, (iii) the product of (a)105.500%, the average of the high and low as a percentage of par value of the 8.00% Fixed-to-Floating Rate Undated Enhanced Capital Notes, issued by LBG Capital No. 1 plc and fully and unconditionally guaranteed by LBG (the “Series 2 ECNs”) on March 3, 2014, and (b) $196,838,461, the maximum amount of Series 2 ECNs that could be exchanged in the Exchange Offer, and (iv) the product of (a)105.000%, the average of the high and low price as a percentage of par value of the 8.50% Fixed-to-Floating Rate Undated Enhanced Capital Notes, issued by LBG Capital No. 1 plc and fully and unconditionally guaranteed by LBG (the “Series 3 ECNs”) on March 3, 2014, and (b) $0, the maximum amount of Series 4 ECNs that could be exchanged in the Exchange Offer.
(2)
The amount of the filing fee was calculated in accordance with Rule 0-11(a)(2) promulgated under the Exchange Act by multiplying the Transaction Valuation by 0.0001288; this filing fee will be offset against the registration fee previously paid in connection with the Offeror’s Registration Statement on Form F-4 filed on March 6, 2014.
 
 
 
 
x
Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid.  Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
 
Amount Previously Paid:
$215,029.19
Filing Party:
Lloyds Banking Group plc
Form or Registration No.:
Schedule TO-I
Date Filed:
March 6, 2014
 
Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.
 
 
Check the appropriate boxes below to designate any transactions to which the statement relates:
 
 
third-party tender offer subject to Rule 14d-1.
 
 
x
issuer tender offer subject to Rule 13e-4.
 
 
going-private transaction subject to Rule 13e-3.
 
 
amendment to Schedule 13D under Rule 13d-2.
 
 
Check the following box if the filing is a final amendment reporting the results of the tender offer: 
 
 
If applicable, check the appropriate box(es) below to designate the appropriate rule provision(s) relied upon:
 
 
Rule 13e-4(i) (Cross-Border Issuer Tender Offer)
 
 
Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)
 
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INTRODUCTORY STATEMENT
 
This Amendment No. 1 (this “Amendment”) amends and supplements the tender offer statement on Schedule TO filed on March 6, 2014 (the “Original Schedule TO” and, together with this Amendment, the “Schedule TO”) filed pursuant to Rule 13e-4 promulgated under the Securities Exchange Act of 1934, as amended, in connection with the following transactions (the “Exchange Offer”) by LBG Capital No. 1 plc (“LBG 1”) and LBG Capital No. 2 plc (“LBG 2” and, together with LBG 1, the “Offerors”), each an indirect wholly owned subsidiary of Lloyds Banking Group plc (“LBG”):
 
 
·
LBG 1’s offer to exchange, on the terms and conditions described in the prospectus dated March 6, 2014, as amended on March 27, 2014 (the “prospectus”), a copy of which is attached hereto as Exhibit (a)(4), Fixed Rate Reset Additional Tier 1 Securities (the “Additional Tier 1 Securities”) issued by LBG, plus accrued and unpaid interest in cash, plus (if applicable) cash amounts in lieu of any fractional Additional Tier 1 Securities, for (1) 7.875% Dated Enhanced Capital Notes due 2020, issued by LBG 1 and fully and unconditionally guaranteed by LBG (the “Series 1 ECNs”), (2) 8.00% Fixed-to-Floating Rate Undated Enhanced Capital Notes, issued by LBG 1 and fully and unconditionally guaranteed by LBG (the “Series 2 ECNs”) and (3) 8.50% Fixed-to-Floating Rate Undated Enhanced Capital Notes, issued by LBG 1 and fully and unconditionally guaranteed by LBG (the “Series 3 ECNs”).
 
 
·
LBG 2’s offer to exchange, on the terms and conditions described in the prospectus, Additional Tier 1 Securities, plus accrued and unpaid interest in cash, plus (if applicable) cash amounts in lieu of any fractional Additional Tier 1 Securities, for 7.875% Dated Enhanced Capital Notes due 2020, issued by LBG 2 and fully and unconditionally guaranteed by Lloyds Bank plc (the “Series 4 ECNs” and, collectively with the Series 1 ECNs, the Series 2 ECNs and the Series 3 ECNs, the “ECNs”).
 
The maximum aggregate principal amount of ECNs that can be accepted in the Exchange Offer is such an amount that would result in issuing the Additional Tier 1 Securities in an aggregate principal amount no greater than $1,675,000,000 (the “Maximum New Issue Size”).
 
Capitalized terms used herein and not defined otherwise defined have the respective meanings assigned to such terms in the Original Schedule TO and the prospectus, as applicable. Except as specifically provided herein, this Amendment does not modify any of the information previously reported in the Original Schedule TO.
 
Item 10. Financial Statements.
 
(a)      Financial Information. Item 10(a) of the Original Schedule TO is hereby deleted and replaced in its entirety with the following:
 
CONSOLIDATED INCOME STATEMENT
 
   
2013
    
2012(1)
  
   
£ million (unless otherwise stated)
  
                 
Interest and similar income
     21,163       23,548  
Interest and similar expense
     (13,825 )     (15,830 )
Net interest income
     7,338       7,718  
Fee and commission income
     4,119       4,650  
Fee and commission expense
     (1,385 )     (1,444 )
Net fee and commission income
     2,734       3,206  
Net trading income
     16,467       15,005  
Insurance premium income
     8,197       8,284  
Other operating income
     3,249       4,700  
Other income
     30,647       31,195  
Total income
     37,985       38,913  
Insurance claims
     (19,507 )     (18,396 )
 
 
3
 
 
   
2013
    
2012(1)
  
   
£ million (unless otherwise stated)
  
                 
Total income, net of insurance claims
     18,478       20,517  
Regulatory provisions
     (3,455 )     (4,175 )
Other operating expenses
     (11,867 )     (11,799 )
Total operating expenses
     (15,322 )     (15,974 )
Trading surplus
     3,156       4,543  
Impairment
     (2,741 )     (5,149 )
Profit (loss) before tax
     415       (606 )
Taxation
     (1,217 )     (781 )
Loss for the year
     (802 )     (1,387 )
                 
Profit attributable to non-controlling interests
     36       84  
Loss attributable to equity shareholders
     (838 )     (1,471 )
Loss for the year
     (802 )     (1,387 )
                 
Basic loss per share
     (1.2 )p      (2.1 )p 
Diluted loss per share
     (1.2 )p      (2.1 )p 
(1)
Restated to reflect the implementation of IFRS 10 and IAS 19 (Revised 2011).
 
SUMMARY CONSOLIDATED BALANCE SHEET
 
   
At 31 December
  
   
2013
    
2012(1)
  
   
£ million (unless otherwise stated)
  
Assets
            
Cash and balances at central banks
     49,915       80,298  
Trading and other financial assets at fair value through profit or loss
     142,683       160,620  
Derivative financial instruments
     33,125       56,557  
Loans and receivables:
                
Loans and advances to banks
     25,365       32,757  
Loans and advances to customers
     495,281       517,225  
Debt securities
     1,355       5,273  
      522,001       555,255  
Available-for-sale financial assets
     43,976       31,374  
Other assets
     55,330       50,117  
Total assets
     847,030       934,221  
                 
Equity and liabilities
                
Liabilities
                
Deposits from banks
     13,982       38,405  
Customer deposits
     441,311       426,912  
Trading and other financial liabilities at fair value through profit or loss
     43,625       33,392  
Derivative financial instruments
     30,464       48,676  
Debt securities in issue
     87,102       117,253  
Liabilities arising from insurance and investment contracts
     110,758       137,592  
Subordinated liabilities
     32,312       34,092  
 
 
4
 
 
   
At 31 December
  
   
2013
    
2012(1)
  
   
£ million (unless otherwise stated)
  
                 
Other liabilities
     48,140       55,318  
Total liabilities
     807,694       891,640  
                 
Equity
                
Shareholders’ equity
     38,989       41,896  
Non-controlling interests
     347       685  
Total equity
     39,336       42,581  
Total equity and liabilities
     847,030       934,221  
                 
Book value per ordinary share(2)
     55 p      60 p 
(1)
Restated to reflect the implementation of IFRS 10 and IAS 19 (Revised 2011).
(2)
Book value per ordinary share is not a term defined by generally accepted accounting principles. Book value per ordinary share is calculated by dividing total shareholders’ equity as of December 31, 2013 by the number of ordinary shares outstanding as of December 31, 2013.
 
Copies of the financial statements pursuant to this Item 10 can be obtained as provided in the prospectus under the heading “Incorporation of Information by Reference”.
 
(b)      Pro Forma Information. Not applicable.
 
Item 11. Additional Information.
 
Item 11(b) of the Original Schedule TO is hereby amended and supplemented as follows:
 
(b) Other Material Information. On March 27, 2014, LBG filed a Pre-Effective Amendment No. 1 to its Registration Statement on Form F-4 (the “Pre-Effective Amendment No. 1”), which included the prospectus. All references in the Schedule TO to the “prospectus” shall be deemed to refer to the prospectus filed with the Pre-Effective Amendment No. 1.
 
Item 12. Exhibits.
 
Exhibits filed as part of this Amendment are listed below. Exhibits incorporated by reference are so indicated.
 
Number
  
Description
(a)(1)
  
Not applicable.
(a)(2)
  
Not applicable.
(a)(3)
  
Not applicable.
(a)(4)***
  
Prospectus, dated March 27, 2014.
(a)(5)**
  
Press release announcing the Exchange Offer.
(b)
  
Not applicable.
(d)(1)*
  
Trust Deed dated December 1, 2009 among LBG 1, LBG 2, Lloyds Bank plc, LBG and BNY Corporate Trustee Services Limited related to, among others, the Series 1 ECNs.
(d)(2)*
  
Supplemental Trust Deed dated December 10, 2009 among LBG 1, Lloyds Bank plc, LBG and BNY Corporate Trustee Services Limited related to the Series 1 ECNs, including the Pricing Schedule relating to the Series 1 ECNs.
(d)(3)*
  
Deed Poll dated December 1, 2009, entered into by LBG related to, among others, the Series 1 ECNs.
(d)(4)*
  
Trust Deed dated December 1, 2009 among LBG 1, LBG 2, Lloyds Bank plc, LBG and BNY Corporate Trustee Services Limited related to, among others, the Series 2 ECNs, Series 3 ECNs and Series 4 ECNs under the £5,000,000,000 Enhanced Capital Note Programme.
(d)(5)*
  
Deed Poll dated December 1, 2009, entered into by LBG related to, among others, Series 2 ECNs, Series 3 ECNs and Series 4 ECNs under the £5,000,000,000 Enhanced Capital Note Programme.
 
 
5
 
 
Number
  
Description
(d)(6)*
  
Final Terms dated December 14, 2009 in respect of the Series 2 ECNs.
(d)(7)*
  
Final Terms dated December 16, 2009 in respect of the Series 3 ECNs.
(d)(8)*
  
Final Terms dated March 17, 2010 in respect of the Series 4 ECNs.
(g)
  
Not applicable.
(h)
  
Not applicable.
*
Incorporated by reference to LBG’s Registration Statement on Form F-4 filed with the Commission on March 6, 2014.
 
**
Incorporated by reference to Schedule TO-I filed with the Commission on March 6, 2014.
 
***
Incorporated by reference to the Pre-Effective Amendment No. 1 to LBG’s Registration Statement on Form F-4, filed with the Commission on March 27, 2014.
 
 
6
 
 
SIGNATURES
 
After due inquiry and to the best knowledge and belief of the undersigned, the undersigned certifies that the information set forth in this statement is true, complete and correct.
 
Date:  March 27, 2014
 
LLOYDS BANKING GROUP PLC
 
By:
/s/ Edward Short
 
Name:    E. Short
 
Title:      Authorised Attorney

 
 
 
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