DBRS Rates HBOS/The Bank of Scotland plc’s New Issuance AAA, Based on Guarantee

DBRS has today assigned a AAA rating to the EUR 1 billion 3.375% senior notes due 2011 issued by Bank of Scotland plc (HBOS). The AAA rating is based on the explicit guarantee of these debt issuances by the Commissioners of Her Majesty’s Treasury (the HM Treasury), which have unconditionally and irrevocably guaranteed the due payment of all sums due and payable by the issuer under the notes.

The AAA rating reflects DBRS’s opinion as to the guarantor’s ability to honour the guarantee as determined by DBRS’s internal assessment of the sovereign. All other debt ratings, including HBOS’s AA (high) long-term debt rating, remain at their current levels. All non guaranteed ratings remain Under Review with Negative Implications, where they were placed on 18 September 2008.

On 8 October 2008, the HM Treasury announced the U.K. government’s 2008 Credit Guarantee Scheme for debt issuances of U.K. incorporated banks and building societies (the Scheme), which forms part of the U.K. government’s measures to ensure the stability of the financial system and to protect ordinary savers, depositors, businesses and borrowers.

The AAA rating only applies to the guaranteed debt; however, DBRS will rate any future debt issuances covered under the Scheme at AAA. For all other debt, DBRS’s current ratings still apply.

Notes:
The applicable methodology is Analytical Background and Methodology for European Bank Ratings, Second Edition, which can be found on our website under Methodologies.

This is a Corporate (Financial Institutions) rating.