Notice to LLL Depositors

With the current turmoil in world financial markets, it is appropriate to clarify the LLL's position in the market place and how LLL depositor funds are used and invested.

The LLL does not operate in the commercial invest­ment and lending markets like most financial institu­tions, and therefore does not carry the same exposure and risk.

The LLL loan and investment policies have been developed to ensure the security of depositor's funds at all times. As such:

1. LLL loans are made only to Lutheran Church of Australia (LCA) projects (i.e., Churches, Schools, Aged Care facilities, etc). In approving LLL loans, the LCA provides a guarantee of full repayment and in addition provides the LLL with an indemnity against any loss in the event of a default. A strict review process of all loan applications is undertaken by various departments and committees of the LCA, prior to any loans being approved and advanced.

2. Funds that are currently not used to provide loans to the LCA are invested with Approved Deposit-taking Institutions (ADI's) in Australia. These institutions are all eligible for the Government's financial guarantee program. In addition, the level of investments in any of these institutions is limited, based on the credit rating of the individual institutions.

3. The LLL does not make any speculative investments. No investments are made in the share market or other similar tradeable securities. Therefore, the LLL does not have any exposure to share market volatility such as is being experienced at present in Australia and overseas.

We thank all depositors for their continued support of the Church through their LLL deposit accounts. We assure you that the security of your deposit is of paramount importance to the LLL Board and policies will continue to reflect this.

If depositors have questions or concerns about their deposits with the LLL, they should feel free to contact the LLL on 1800 556 457.

Graeme Huf, Chairman Allen Kupke, Chief Executive Officer