Notes to the financial statements

There are no exceptional items in the current year. Descriptions below relate to prior year items.

The EBS related exceptional item relates to the final reorganisation and rationalisation costs following the acquisition of EBS in June 2006.

A sub-custodian made a post-trade settlement adjustment debiting a Group company’s account for a total of £23m without notice or the Group’s consent. As a result of the need to resort to litigation to recover the debt, the Group provided in full against this debt (£13m after offsetting cost recoveries).

During the year ended 31 March 2007, the Group closed a number of its futures operations. The gain that arises in the prior year is as a result of the disposal of shares and memberships included within available-for-sale assets whose disposal was restricted in the earlier years. This is offset by rationalisation and other costs related to the closure of these businesses.

Other exceptional gains arise from the disposal of exchange shares and seats together with litigation settlements in Australia and Hong Kong.