Lloyd's Capital Structure Overview

LLOYD'S Strong and Flexible Capital Structure: Lloyd's "Chain of Security" Claims/ Losses SEVERAL ASSETS FIRST LINK SECOND LINK SYNDICATE LEVEL ASSETS £52,983m All premiums received by a syndicate are held in its premium trust funds and are the first resource for paying policyholder claims from that syndicate. MEMBERS FUNDS AT LLOYD'S (FAL) £22,291m Each member provides Capital to support its underwriting at Lloyd's. Each managing agent produces its own capital assessment in respect of each managed syndicate stating how much capital it considers is needed to cover its underlying business risks with a 99.5% confidence level. £83m CALLABLE LAYER (≤3%) 2 £875m MUTUAL ASSETS THIRD LINK CENTRAL FUND £2,030m CORPORATION NET ASSETS¹ SUBORDINATED DEBT/ SECURITIES £792m The central assets are available at the discretion of the Council of Lloyd's to meet any valid claim that cannot be met by the resources of any member. It is funded by members' annual contributions and subordinated debt issued by the Society in 2014 and 2017. 1) Corporation net assets: Corporation Reserves, Associates Reserve, Revaluation Reserve, Translation Reserve; 2) Callable layer: Central Fund assets may be supplemented by a 'callable layer' of up to 3% of members' overall premium limits in any one calendar year. These funds would be drawn from premium trust funds. Source: Lloyd's pro forma financial statements, 30 June 2017 3 16 2 1

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