We believe the prospect of extraordinary government support for U.K. banks is now uncertain in view of the country's well-advanced and effective resolution regime. We are therefore removing the two notches of uplift for government support that we had previously incorporated in the long-term counterparty credit ratings on the principal bank operating subsidiaries of Lloyds Banking Group PLC. However, we now include one notch in the long-term ratings because we consider that Lloyds has substantial additional loss-absorbing capacity (ALAC). We have also recognized a strengthening in Lloyds' intrinsic creditworthiness. We are affirming the long- and short-term counterparty credit ratings on Lloyds Bank PLC and Bank of Scotland PLC at 'A/A-1', and removing these ratings from CreditWatch with negative implications, where
