Obligation HSBC Global plc 0.842% ( JP582666BG92 ) en JPY

HSBC Global plc

100 % ⇌

Royaume-Uni

JP582666BG92 ( en JPY )

0.842% par an ( paiement annuel )

26/09/2023 - Obligation échue

Prospectus brochure de l'obligation HSBC Holdings plc JP582666BG92 en JPY 0.842%, échue

100 JPY

59 300 000 000 JPY

HSBC Holdings plc est une banque multinationale britannique dont le siège social est à Londres, opérant dans plus de 60 pays et territoires, offrant une large gamme de services financiers aux particuliers, aux entreprises et aux institutions.

L'Obligation émise par HSBC Global plc ( Royaume-Uni ) , en JPY, avec le code ISIN JP582666BG92, paye un coupon de 0.842% par an.
Le paiement des coupons est annuel et la maturité de l'Obligation est le 26/09/2023

LISTING PARTICULARS

HSBC HOLDINGS PLC
(a company incorporated with limited liability in England with registered number 617987)
as Issuer
¥58,100,000,000 0.450% Senior Unsecured Fixed Rate Bonds due 2021
¥59,300,000,000 0.842% Senior Unsecured Fixed Rate Bonds due 2023
¥4,400,000,000 1.207% Senior Unsecured Fixed Rate Bonds due 2026
On 26 September 2016, HSBC Holdings plc ("HSBC Holdings" or the "Issuer") issued ¥58,100,000,000
0.450% Senior Unsecured Fixed Rate Bonds due 2021 (the "Bonds (First Series 2016)"),
¥59,300,000,000 0.842% Senior Unsecured Fixed Rate Bonds due 2023 (the "Bonds (Second Series
2016)"), and ¥4,400,000,000 1.207% Senior Unsecured Fixed Rate Bonds due 2026 (the " Bonds (Third
Series 2016)") (and together, the Bonds (First Series 2016), the Bonds (Second Series 2016) and the
Bonds (Third Series 2016), the "Bonds"), which are described in this document. This document (and all
documents incorporated by reference herein) (the "Listing Particulars") has been prepared for the
purpose of providing disclosure information with regard to the Bonds to be admitted to the Official List of
the Irish Stock Exchange and trading on its Global Exchange Market. The Irish Stock Exchange's Global
Exchange Market is not a regulated market for the purposes of the Markets in Financial Instruments
Directive (2004/39/EC) ("MiFID"). These Listing Particulars constitute listing particulars for the
purposes of listing on the Irish Stock Exchange's Official List and trading on its Global Exchange
Market. Application has been made for these Listing Particulars to be approved by the Irish Stock
Exchange and the Bonds to be admitted to the Irish Stock Exchange's Official List and to trading on its
Global Exchange Market. Investors should note that securities to be admitted to the Irish Stock
Exchange's Official List and trading on its Global Exchange Market will, because of their nature,
normally be bought and traded by a limited number of investors who are particularly
knowledgeable in investment matters.
These Listing Particulars do not constitute (i) a prospectus for the purposes of Part VI of the
Financial Services and Markets Act 2000 (as amended) or (ii) a base prospectus for the purposes of
Directive 2003/71/EC (as amended) (the "Prospectus Directive"). These Listing Particulars have
been prepared solely with regard to the Bonds which are (i) not to be admitted to listing or trading
on any regulated market for the purposes of MiFID and (ii) not to be offered to the public in a
Member State (other than pursuant to one or more of the exemptions set out in Article 3.2 of the
Prospectus Directive). These Listing Particulars have not been approved or reviewed by any
regulator which is a competent authority under the Prospectus Directive.
The Bonds are issued in the denomination of ¥100,000,000 each.
AN INVESTMENT IN THE BONDS INVOLVES CERTAIN RISKS. SEE PAGE 5 FOR RISK
FACTORS.
The Bonds were each assigned a credit rating of A1 by Moody's Investors Service, Inc. and A by
Standard and Poor's Ratings Services.
The Bonds have not been and will not be registered under the United States Securities Act of 1933, as
amended (the "Securities Act"), and may not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in certain transactions exempt from the registration
requirements of the Securities Act. Terms used in this paragraph have the meanings given to them by
Regulation S under the Securities Act.

7 December 2016

196983-4-343-v5.0
- 1-

IMPORTANT NOTICES
HSBC Holdings accepts responsibility for the information contained in this document. To the best of the
knowledge of HSBC Holdings, which has taken all reasonable care to ensure that such is the case, the
information contained in this document is in accordance with the facts and does not omit anything likely
to affect the import of such information.
The managers named under "Subscription and Sale" below (the "Managers") have not separately verified
the information contained herein. Accordingly, no representation, warranty or undertaking, express or
implied, is made and no responsibility is accepted by the Managers as to the accuracy or completeness of
these Listing Particulars or any document incorporated by reference herein or any further information
supplied in connection with any Bonds. The Managers accept no liability in relation to these Listing
Particulars or their distribution or with regard to any other information supplied by or on behalf of
HSBC Holdings.
No person has been authorised to give any information or to make any representation not contained in or
not consistent with these Listing Particulars and, if given or made, such information or representation
must not be relied upon as having been authorised by HSBC Holdings or any of the Managers.
These Listing Particulars should not be considered as a recommendation by HSBC Holdings or any of the
Managers that any recipient of these Listing Particulars should purchase any of the Bonds. Each investor
contemplating purchasing the Bonds should make its own independent investigation of the financial
condition and affairs, and its own appraisal of the creditworthiness, of HSBC Holdings. No part of these
Listing Particulars constitutes an offer or invitation by or on behalf of HSBC Holdings or the Managers
or any of them to any person to subscribe for or to purchase any of the Bonds.
Neither the delivery of these Listing Particulars nor the offering, sale or delivery of any Bonds shall, in
any circumstances, create any implication that there has been no change in the affairs of HSBC Holdings
since the date hereof, or that the information contained in these Listing Particulars is correct at any time
subsequent to the date hereof or that any other written information delivered in connection herewith or
therewith is correct as of any time subsequent to the date indicated in such document. The Managers
expressly do not undertake to review the financial condition or affairs of HSBC Holdings or its subsidiary
undertakings during the life of the Bonds.
The distribution of these Listing Particulars and the offer or sale of the Bonds may be restricted by law in
certain jurisdictions. Persons into whose possession these Listing Particulars or any Bonds come must
inform themselves about, and observe, any such restrictions. For a description of certain restrictions on
offers, sales and deliveries of Bonds and on the distribution of these Listing Particulars, see "Subscription
and Sale" below.
All references in these Listing Particulars to "£", "pounds", "Pounds Sterling" and "Sterling" are to the
lawful currency of the United Kingdom, all references to "$", "dollars", "U.S.$", "USD" and "U.S.
Dollars" are to the lawful currency of the United States of America and all references to "", "euro" and
"EUR", are to the lawful currency of the member states of the European Union that have adopted or
adopt the single currency in accordance with the Treaty establishing the European Community, as
amended and all references to "yen", "JPY" or "¥" are to the lawful currency for the time being of Japan.
*****
196983-4-343-v5.0
- ii-

CONTENTS

Page
OVERVIEW ................................................................................................................................................. 1
RISK FACTORS .......................................................................................................................................... 5
DOCUMENTS INCORPORATED BY REFERENCE ............................................................................... 9
TERMS AND CONDITIONS OF THE BONDS (FIRST SERIES 2016) ................................................. 10
TERMS AND CONDITIONS OF THE BONDS (SECOND SERIES 2016) ............................................ 20
TERMS AND CONDITIONS OF THE BONDS (THIRD SERIES 2016) ................................................ 30
DESCRIPTION OF THE ISSUER............................................................................................................. 40
UNITED KINGDOM TAXATION ........................................................................................................... 41
CERTAIN OTHER TAXATION MATTERS ........................................................................................... 43
SUBSCRIPTION AND SALE ................................................................................................................... 44
GENERAL INFORMATION .................................................................................................................... 45
196983-4-343-v5.0

OVERVIEW
This overview must be read as an introduction to these Listing Particulars and any decision to invest in
the Bonds should be based on a consideration of the these Listing Particulars as a whole, including the
documents incorporated by reference.
This overview refers to certain provisions of the Conditions and is qualified by the more detailed
information contained elsewhere in these Listing Particulars.
Words and expressions defined in the "Terms and Conditions of the Bonds (First Series 2016)", "Terms
and Conditions of the Bonds (Second Series 2016)", "Terms and Conditions of the Bonds (Third Series
2016)" below or elsewhere in these Listing Particulars have the same meanings in this overview.
The Issuer:
HSBC Holdings plc
Lead Managers:
HSBC Securities (Japan) Ltd.
Mizuho Securities Co., Ltd.
Nomura Securities Co., Ltd.
SMBC Nikko Securities Inc.
Managers:
Daiwa Securities Co. Ltd.
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
Fiscal Agent:
Mizuho Bank, Ltd.
The Bonds:
¥58,100,000,000 0.45% Senior Unsecured Fixed Rate Bonds due
2021
¥59,300,000,000 0.842% Senior Unsecured Fixed Rate Bonds due
2023
¥4,400,000,000 1.207% Senior Unsecured Fixed Rate Bonds due
2026
Issue Price:
100 per cent.
Issue Date:
26 September 2016
Interest:
The Bonds (First Series 2016) bear interest at the rate of 0.450 per
cent. per annum of their principal amount for the period from, and
including, 27 September 2016 to, and including, 24 September
2021, payable semi-annually in arrear on 26 March and
26 September of each year in respect of the half year period to and
including each such interest payment date; provided, however, that
the interest in respect of the period from, and including, 27 March
2021 to, and including, 24 September 2021 shall be payable on
24 September 2021.

The Bonds (Second Series 2016) bear interest at the rate of 0.842
per cent. per annum of their principal amount for the period from,
and including, 27 September 2016 to, and including, 26 September
2023, payable semi-annually in arrear on 26 March and
26 September of each year in respect of the half year period to and
including each such interest payment date.
196983-4-343-v5.0
- 1-

The Bonds (Third Series 2016) bear interest at the rate of 1.207 per
cent. per annum of their principal amount for the period from, and
including, 27 September 2016 to, and including, 26 September
2026, payable semi-annually in arrear on 26 March and
26 September of each year in respect of the half year period to and
including each such interest payment date; provided, however, that
the interest in respect of the period from, and including, 27 March
2026 to, and including, 25 September 2026 shall be payable on
25 September 2026.
Initial Interest Payment Date:
26 March 2017
Prescription:
The period of extinctive prescription shall be 10 years for the
principal of the Bonds and 5 years for the interest on the Bonds.
Status:
The Bonds constitute direct and unsecured obligations of the Issuer,
and rank and will rank pari passu without any preference among
themselves and pari passu with all other unsubordinated and
unsecured obligations of the Issuer, present and future, other than
any such obligations preferred by law.
UK Bail-in Power
By its acquisition of the Bonds, each holder of Bonds (a
Acknowledgement
"Bondholder") acknowledges, accepts, consents and agrees, agrees
to be bound by: (a) the exercise of any UK Bail-in Power (as
defined below) by the Relevant UK Resolution Authority (as
defined below) that may result in (i) the reduction of all, or a
portion, of the Amounts Due (as defined below); (ii) the conversion
of all, or a portion, of the Amounts Due into the Issuer's or another
person's ordinary shares, other securities or other obligations (and
the issue to, or conferral on, the Bondholder of such ordinary
shares, other securities or other obligations), including by means of
an amendment, modification or variation of the terms of the Bonds;
(iii) the cancellation of the Bonds; and/or (iv) the amendment or
alteration of the date for redemption of the Bonds or amendment of
the amount of interest payable on the Bonds, or the Interest
Payment Dates, including by suspending payment for a temporary
period; and (b) the variation of the terms of the Bonds, if necessary,
to give effect to the exercise of any UK Bail-in Power by the
Relevant UK Resolution Authority.
For these purposes:
"UK Bail-in Power" means any write-down, conversion, transfer,
modification or suspension power existing from time to time under,
and exercised in compliance with, any laws, regulations, rules or
requirements in effect in the United Kingdom, relating to the
transposition of the BRRD, including but not limited to the
Banking Act and the instruments, rules and standards created
thereunder, pursuant to which (i) any obligation of a Regulated
Entity (or other affiliate of such Regulated Entity) can be reduced,
cancelled, modified or converted into shares, other securities or
other obligations of such Regulated Entity or any other person (or
suspended for a temporary period); and (ii) any right in a contract
governing an obligation of a Regulated Entity may be deemed to
have been exercised.
"Relevant UK Resolution Authority" means any authority with
the ability to exercise a UK Bail-in Power.
196983-4-343-v5.0
- 2-

The exercise of the UK Bail-in Power by the Relevant UK
Resolution Authority with respect to the Bonds shall not constitute
an Event of Default.
Form and Denomination:
The Bonds are issued in the denomination of ¥100,000,000 each.
The Book-Entry Transfer Law (as defined in the Conditions) shall
apply to the Bonds and the transfer of the Bonds and other matters
relating to the Bonds shall be dealt with in accordance with the
Book-Entry Transfer Law and the Business Regulations (as defined
in the Conditions). Bond Certificates shall not be issued, except in
limited cases set forth in the Book-Entry Transfer Law.
Final Redemption:
Bonds (First Series 2016): 24 September 2021 at 100 per cent. of
their principal amount.
Bonds (Second Series 2016): 26 September 2023 at 100 per cent. of
their principal amount.
Bonds (Third Series 2016): 25 September 2026 at 100 per cent. of
their principal amount.
Redemption for Tax Reasons:
The Bonds may be redeemed at the option of the Issuer in whole,
but not in part, at any time, if:

(a)
on the occasion of the next payment due under the Bonds,

(i)
the Issuer has or will become obliged to pay
Additional Amounts as provided in Condition 6
(in the Conditions of the Bonds for each Series);
or

(ii)
interest payments under or with respect to the
Bonds are no longer fully deductible for United
Kingdom corporation tax purposes; or

as a result of any change in, or amendment to, the laws or
regulations of the United Kingdom (or any authority or
political subdivision therein or thereof having power to
tax) or any change in the official application or
interpretation of such laws or regulations, which change or
amendment becomes effective on or after 26 September
2016; and

(b)
in the case of (i) above, such obligation cannot be avoided
by the Issuer taking reasonable measures available to it,

as described in the Conditions of the Bonds for each Series.
Events of Default:
The Bonds contain certain events of default provisions, as further
described in the Conditions of the Bonds of the relevant Series;
however, there are no provisions for cross default.
Taxation:
All payments of principal and interest in respect of the Bonds by
the Issuer will be made free and clear of, and without withholding
of or deduction for or on account of any taxes, duties, assessments
or governmental charges of whatever nature, present or future, as
are imposed or levied by or on behalf of the United Kingdom (or
any authority or political subdivision therein or thereof having
power to tax), unless such withholding or deduction is required by
196983-4-343-v5.0
- 3-

law.

In such event, the Issuer shall pay such additional amounts (the
"Additional Amounts") as may be necessary in order that the net
amounts receivable by the Bondholders or, as the case may be, the
pledgees in respect of the Bonds after such withholding or
deduction shall equal the respective amounts of principal and
interest which would have been receivable in respect of the Bonds
in the absence of such withholding or deduction, subject to certain
exceptions as described in the Conditions of the Bonds for each
Series.
Governing Law:
The Bonds are governed by, and shall be construed in accordance
with, the laws of Japan.
Listing and Trading:
Application has been made for these Listing Particulars to be
approved by the Irish Stock Exchange and the Bonds to be
admitted to the Irish Stock Exchange's Official List and to trading
on its Global Exchange Market.
Clearing Systems:
Japan Securities Depository Center, Incorporated ("JASDEC" and
"Book-Entry Transfer Institution") will act as book-entry
transfer institution (furikae kikan) of the Bonds under the Book-
Entry Transfer Law.
Selling Restrictions:
See "Subscription and Sale".
Risk Factors:
Investing in the Bonds involves risks. See "Risk Factors".
ISIN:
Bonds (First Series 2016): JP582666AG93

Bonds (Second Series 2016): JP582666BG92

Bonds (Third Series 2016): JP582666CG91

196983-4-343-v5.0
- 4-

RISK FACTORS
Any investment in the Bonds is subject to a number of risks. Prior to investing in the Bonds, prospective
investors should carefully consider risk factors associated with any investment in the Bonds, the business
of the Issuer and the industry in which it operates together with the Annual Report and Accounts of the
Issuer and its subsidiary undertakings for the year ended 31 December 2015 and all other information
contained in these Listing Particulars, including, in particular, the risk factors described below and the
risk factors set out in the registration document, incorporated by reference (the "Registration
Document"). The Issuer considers such risk factors to be the principal risk factors that may affect the
Issuer's ability to fulfil its obligations under the Bonds and/or risk factors that are material for the
purposes of assessing the market risk associated with the Bonds. Words and expressions defined in the
Conditions or elsewhere in these Listing Particulars have the same meanings in this section.
The following is not an exhaustive list or explanation of all risks which investors may face when making
an investment in the Bonds and should be used as guidance only. Additional risks and uncertainties
relating to the Issuer or the Bonds that are not currently known to the Issuer, or that the Issuer currently
deems immaterial, may individually or cumulatively also have a material adverse effect on the business,
prospects, results of operations and/or financial position of the Issuer and its subsidiaries, the value of
the Bonds and, if any such risk should occur, the price of the Bonds may decline and investors could lose
all or part of their investment. Investors should consider carefully whether an investment in the Bonds is
suitable for them in light of the information in these Listing Particulars and their personal circumstances.
Terms and expressions in these risk factors shall, unless otherwise defined or unless the context otherwise
requires, have the same meaning and be construed in accordance with Conditions of the Bonds.
Risks relating to the Issuer
The section entitled "Risk Factors" on pages 109a to 109l of the Annual Report of the Issuer for the year
ended 31 December 2015 on Form 20-F, as incorporated by reference herein, sets out a description of the
risk factors that may affect the ability of the Issuer to fulfil its obligations to investors in relation to the
Bonds.
Risks relating to the Bonds
The Bonds are the subject of the UK Bail-in Power, which may result in the Bonds being written down
to zero or converted into other securities, including unlisted equity securities
On 1 January 2015, the Banking Act and other primary and secondary legislative instruments were
amended to give effect to the BRRD in the UK. The stated aim of the BRRD is to provide supervisory
authorities, including the Relevant UK Resolution Authority, with common tools and powers to address
banking crises pre-emptively in order to safeguard financial stability and minimise taxpayers'
contributions to bank bail-outs and/or exposure to losses.
As the parent company of a UK bank, the Issuer is subject to the Banking Act, which gives wide powers
in respect of UK banks and their parent and other group companies to Her Majesty's Treasury ("HM
Treasury"), the Bank of England, the UK Prudential Regulation Authority and the Financial Conduct
Authority in circumstances where a UK bank has encountered or is likely to encounter financial
difficulties.
As a result, the Bonds are subject to existing UK Bail-in Power under the Banking Act and may be
subject to future UK Bail-in Power under existing or future legislative and regulatory proposals, including
measures implementing the BRRD. In particular, the Banking Act was amended to implement a "bail-in"
tool, which may be exercised by the Bank of England (the "BoE") (as a Relevant UK Resolution
Authority) and forms part of the UK Bail-in Power.
Where the conditions for resolution exist, the BoE may use the bail-in tool (individually or in
combination with other resolution tools under the Banking Act) to cancel all or a portion of the principal
amount of, or interest on, certain unsecured liabilities of a failing financial institution and/or convert
certain debt claims into another security, including ordinary shares of the surviving entity. In addition, the
BoE may use the bail-in tool to, among other things, replace or substitute the issuer as obligor in respect
of debt instruments, modify the terms of debt instruments (including altering the maturity (if any) and/or
the amount of interest payable and/or imposing a temporary suspension on payments) and discontinue the
196983-4-343-v5.0
- 5-

listing and admission to trading of financial instruments. The BoE must apply the bail-in tool in
accordance with a specified preference order. In particular, the Banking Act requires resolution
authorities to write-down or convert debts in the following order: (i) additional tier 1 instruments, (ii) tier
2 instruments, (iii) other subordinated claims that do not qualify as additional tier 1 or tier 2 instruments
and (iv) eligible senior claims. Although the bail-in tool has a safeguard designed to leave no creditor
worse off than in the case of insolvency, due to the discretion afforded to the BoE, the claims of some
creditors whose claims would rank equally with the Bondholders' may be excluded from being subject to
the bail-in tool. The greater number of such excluded creditors there are, the greater the potential impact
of the bail-in tool on other creditors who have not been excluded (which may include the Bondholders).
As a result, the Bonds, which are subject to the bail-in tool, will be written down or converted if the
reduction of additional tier 1 instruments, tier 2 instruments and subordinated claims that do not qualify as
an additional tier 1 or tier 2 instrument, does not sufficiently reduce the aggregate amount of liabilities
that must be written down or converted to prevent the HSBC Group's failure.
Moreover, to the extent the UK Bail-in Power is exercised pursuant to the Banking Act or otherwise, the
Issuer does not expect any securities issued upon conversion of the Bonds to meet the listing requirements
of any securities exchange, and the Issuer expects its outstanding listed securities to be delisted from the
securities exchanges on which they are listed. Any securities the Bondholders receive upon conversion of
their Bonds (whether debt or equity) likely will not be listed for at least an extended period of time, if at
all, or may be on the verge of being delisted by the relevant exchange, including, for example, the Issuer's
American depositary receipts listed on the New York Stock Exchange or the Issuer's ordinary shares
listed on the London Stock Exchange or otherwise. Additionally, there may be limited, if any, disclosure
with respect to the business, operations or financial statements of the issuer of any securities issued upon
conversion of the Bonds, or the disclosure with respect to any existing issuer may not be current to reflect
changes in the business, operations or financial statements as a result of the exercise of the UK Bail-in
Power. Moreover, the exercise of the UK Bail-in Power and/or other actions implementing the UK Bail-in
Power may require interests in the Bonds to be held or taken, as the case may be, through clearing
systems, intermediaries or persons other than the Book-Entry Transfer Institution. As a result, there may
not be an active market for any securities the Bondholders may hold after the exercise of the UK Bail-in
Power.
The Bondholders should consider the risk that the Bondholders may lose all of the investment, including
the principal amount plus any accrued interest, if the UK Bail-in Power is acted upon or that any
remaining outstanding Bonds or securities into which the Bonds are converted, including the Issuer's
ordinary shares, may be of little value at the time of conversion and thereafter. In addition, trading
behavior, including prices and volatility, may be affected by the threat of bail-in and, as a result, the
Bonds are not necessarily expected to follow the trading behavior associated with other types of
securities.
The records, etc. under the Book-Entry Transfer System
It is not yet clear what procedures and timelines will need to be followed in connection with the exercise
of the UK Bail-in Power. It is possible that a public notice of the exercise of the UK Bail-in Power could
be given immediately before or even after the effective date of such exercise. Also, even if the Issuer
and/or the Fiscal Agent request the Book-Entry Transfer Institution immediately upon the exercise of the
UK Bail-in Power to take necessary actions in accordance with the UK Bail-in Power (including but not
limited to mark-down of the value of the Bonds as recorded under the Book-Entry Transfer System and/or
to suspension of the transfers through the Book-Entry Transfer System), a period of time may be required
before implementation of such actions. As a result, there can be no assurance that mark-down of the value
of Bonds as recorded under the Book-Entry Transfer System and/or suspension of transfers through the
Book-Entry Transfer System will be implemented before or simultaneously with the effectiveness of any
exercise of the UK Bail-in Power, and there is a possibility that the Bonds have been already written
down or converted and therefore the Issuer has been already released from its payment obligations under
the Bonds even when there are still records of the Bonds in the case of the exercise of the UK Bail-in
Power. In addition, when the Bonds are converted into shares or other securities or obligations of the
Issuer or any other person pursuant to a UK Bail-in Power, the procedures for conversion and delivery of
the shares, etc. may not be conducted within the framework of the Book-Entry Transfer System.
196983-4-343-v5.0
- 6-

The UK's referendum on EU membership
Following the UK electorate's vote to leave the European Union (the "EU") in a national referendum,
there has been a period of volatility against a backdrop of uncertainty, which is likely to continue for
some time. The Issuer was aware of the potential for market disruption in the aftermath of a vote to leave
the EU and took steps to plan for this outcome.
Negotiation of the UK's exit agreement, its future relationship with the EU and its trading relationship
with the rest of the world will likely take a number of years to resolve. During this time, uncertainty as to
the precise terms of these arrangements and the future legal and regulatory landscape may lead to
uncertain economic conditions and market volatility. This may lead to reduced economic growth which
could affect both the Issuer and its clients.
Among other issues, changes to the UK's future relationship are likely to influence the business model for
the Issuer's London-based European cross-border banking operations, which currently rely on unrestricted
access to the European financial services market.
Until the terms and timing of the UK's exit from the EU are confirmed, including the terms on which UK
financial institutions will conduct cross-border business post-exit, it is not possible to fully determine the
impact on the Issuer.
Other changes in law may adversely affect the rights of Bondholders
Changes in law after the date hereof may affect the rights of Bondholders as well as the market value of
the Bonds. Such changes in law may include changes in statutory, tax and regulatory regimes during the
life of the Bonds, which may have an adverse effect on an investment in the Bonds.
In addition, any change in law or regulation that results in the Issuer's having to pay Additional Amounts
to the Bondholders could constitute a tax event that may entitle the Issuer to redeem the Bonds, in whole
(but not in part), as more particularly described in Condition 6 (Redemption and Purchase) of the
Conditions of the Bonds.
Such legislative and regulatory uncertainty could also affect the ability of Bondholders to accurately
value the Bonds and, therefore, affect the trading price of the Bonds given the extent and impact on the
Bonds that one or more regulatory or legislative changes could have on the Bonds.
The Issuer may issue securities pari passu with the Bonds and/or secured debt
There is no restriction on the amount of securities that the Issuer may issue that rank pari passu with the
Bonds. In particular, the Financial Stability Board (the "FSB") final standards for total loss absorbing
capacity ("TLAC") requirements for global systemically important banks will apply to the Issuer once
implemented in the United Kingdom, and the Issuer expects to issue between $60 billion and $80 billion
in aggregate principal amount of senior debt securities between 2016 and 2018 in order to meet these
TLAC requirements. Furthermore, the Issuer (and its subsidiaries) may incur additional debt, including
secured debt. The Bonds will be effectively subordinated to any indebtedness or other liabilities of the
Issuer's subsidiaries and to any of its indebtedness that is secured by property or assets to the extent of the
value of the property or assets securing such indebtedness. In the event of the Issuer's winding up, the
Bondholders may recover from the value of the Issuer's assets to satisfy claims of the Bondholders only
after secured creditors of the Issuer have been paid in full. In addition, the claims of pari passu creditors
may reduce the amount recoverable by the Bondholders. Therefore, the Bondholders may lose all or
some of investment in the Bonds in the event of winding up of the Issuer.
The Issuer's holding company structure may mean that its rights to participate in assets of any of the
Issuer's subsidiaries upon its liquidation may be subject to prior claims of some of its creditors,
including when the Issuer has loaned or otherwise advanced the proceeds received from the issuance
of the Bonds to such subsidiary
The Bonds are the Issuer's obligations exclusively and are not guaranteed by any person, including any of
its subsidiaries. The Issuer is a non-operating holding company and, as such, its principal source of
income is derived from its operating subsidiaries that hold the principal assets of the Issuer together with
its subsidiary undertakings. As a separate legal entity, the Issuer relies on, among other things, remittance
of its subsidiaries' loan interest payments and dividends in order to be able to meet its obligations to the
196983-4-343-v5.0
- 7-