Trust Assets: Client Update - Post Administration Client Money Interest Update - 18 March 2015

As part of the overall resolution of the Trust Estate, LBIE will shortly be finalising the management and settlement of interest on Post Administration Client Money that has been, or continues to be, held by LBIE on behalf of its Trust Clients (“PACM Interest”). In that context, the Administrators would like to advise clients of the following matters:

• The relatively small PACM balances that remain outstanding, coupled with the continuing low prevailing market rates of interest, has meant that the amount of PACM Interest being earned is currently very low.In practice the amount of PACM Interest is now potentially less than the cost incurred by the LBIE unsecured estate to receive, process and return it to clients. Accordingly, going forward LBIE will no longer calculate individual PACM Interest entitlements based on the actual interest earned up to the date of client settlement. Instead LBIE will accrue upfront the likely future amount of PACM Interest that might be earned for each client and then include that in full in the final amounts to be returned. This upfront accrual of PACM Interest will be set at a level that ensures that clients will not be disadvantaged by this process change.
  
  

• In addition to the change noted above, LBIE has performed a final roll forward and reconciliation of PACM Interest entitlements to capture any further amounts owed to clients. LBIE will be contacting all relevant clients to provide details of these additional amounts and to arrange for their payment. In the majority of cases the amounts are very low in value and clients may choose to expressly waive the proposed return.

If you have any queries please contact your usual LBIE representative or the Communications and Counterparty Management team by emailing generalqueries@lbia-eu.com.