HBOS - The Way We Do Business

Around 80% of our small shareholders are also our customers. 95% of our colleagues hold HBOS shares. We have the largest small shareholder base in the UK. Their interests are therefore more closely aligned with the Group than any other bank. We are pleased to introduce our latest Corporate Responsibility Report.

2006 Highlights include:
• Increased the dividend per share by 15%to 41.4p.
• Share price improved 14% to £11.32 by end December.
• Achieved more retail best buys than any major bank – over 3,000 appearances in best buy tables.
• UK’s leading savings provider helping 15 million customers save for the future.
• We lend £10bn in mortgages in deprived areas of the UK.
• Income multiple of 2.5 across mortgage book, with average loan-to-value of 44%.
• Only financial institution to have piloted the Saving Gateway with HM Treasury.  
• Invested £44.2m in local communities.
• Reduced UK carbon emissions by 65%, or nearly two thirds over two years. To download the full report or for further information please visit:

www.hbosplc.com