September

Canaccord Genuity advises Abbey on the disposal of its Italian mortgage operations to UniCredito

Abbey National announced in September 2003 the disposal of its Italian mortgage operations, Abbey National Bank Italy ("ANBI") to a wholly owned subsidiary of UniCredito Italiano SpA ("UniCredito") , Italy's largest bank by market capitalisation.

The sale releases total value to Abbey National of approximately £140 million. This comprises a cash premium of up to £46.2 million (EUR65.5 million) over net assets, which are not material since ANBI is operated as a branch, and the release of approximately £96 million of capital allocated to support the business from the group balance sheet.

As part of the transaction UniCredito is acquiring and re-financing ANBI's approximately EUR4.3 billion of mortgage assets.

The transaction is consistent with Abbey National's strategy of focusing on its core personal financial services activities in the UK. For UniCredito, the acquisition allows it to widen its product offering and gives it a total projected 17 per cent share of the Italian mortgage market at the end of 2003.

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