Obligation Emirates NBD Bank 4.625% ( XS0765257141 ) en USD

Emirates NBD Bank

100 % ▼

Emirats Arabes Unis

XS0765257141 ( en USD )

4.625% par an ( paiement semestriel )

28/03/2017 - Obligation échue

Prospectus brochure de l'obligation Emirates NBD XS0765257141 en USD 4.625%, échue

200 000 USD

1 000 000 000 USD

Emirates NBD est une banque multinationale basée à Dubaï, aux Émirats arabes unis, offrant une large gamme de services bancaires de détail, commerciaux et d'investissement.

L'Obligation émise par Emirates NBD Bank ( Emirats Arabes Unis ) , en USD, avec le code ISIN XS0765257141, paye un coupon de 4.625% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 28/03/2017

BASE PROSPECTUS
EMIRATES NBD PJSC
(incorporated with limited liability in The United Arab Emirates)
EMIRATES NBD GLOBAL FUNDING LIMITED
(incorporated as an exempted company with limited liability in the Cayman Islands)
U.S.$7,500,000,000
Euro Medium Term Note Programme
On 20 June 2002, Emirates Bank International PJSC (``EBI'') entered into a U.S.$1,000,000,000 Euro Medium Term Note Programme (the
``Programme''). On 19 January 2005, the maximum aggregate nominal amount of Notes which may be outstanding under the Programme was
increased from U.S.$1,000,000,000 to U.S.$3,500,000,000 and on 19 April 2007 such maximum aggregate nominal amount was further increased to
U.S.$7,500,000,000. On 21 November 2009, EBI was legally amalgamated with Emirates NBD PJSC (``ENBD''). As a result of the amalgamation, all of
the assets and liabilities of EBI were transferred to ENBD, EBI was dissolved and ENBD is now considered to be the issuer of the Notes issued by EBI
prior to the date hereof. Any Notes (as defined below) issued under the Programme are issued subject to the provisions set out herein. This does not
affect any Notes issued prior to the date hereof.
Under the Programme, ENBD and Emirates NBD Global Funding Limited (``EGF'' and, together with ENBD in its capacity as issuer, the ``Issuers'' and
each an ``Issuer'') may from time to time issue notes (the ``Notes'') denominated in any currency agreed between the relevant Issuer and the relevant
Dealer (as defined below).
The payments of all amounts due in respect of the Notes issued by EGF will be unconditionally and irrevocably guaranteed (the ``Guarantee'') by ENBD
(in such capacity, the ``Guarantor'').
References to ``the relevant Obligor(s)'' shall, in the case of any issue of Notes, mean the relevant Issuer and, if the relevant Issuer is EGF, the
Guarantor.
The maximum aggregate nominal amount of all Notes from time to time outstanding under the Programme will not exceed U.S.$7,500,000,000 (or its
equivalent in other currencies calculated as described herein), subject to increase as described herein.
The Notes may be issued on a continuing basis to one or more of the Dealers specified under ``General Description of the Programme'' and any
additional Dealer appointed under the Programme from time to time by the Issuers (each a ``Dealer'' and together the ``Dealers''), which appointment
may be for a specific issue or on an ongoing basis. References in this Base Prospectus to the ``relevant Dealer'' shall, in the case of an issue of Notes
being (or intended to be) subscribed by more than one Dealer, be to all Dealers agreeing to subscribe for such Notes. An investment in Notes issued
under the Programme involves certain risks. For a discussion of these risks see ``Risk Factors''.
Application has been made to the Commission de Surveillance du Secteur Financier (the ``CSSF'') in its capacity as competent authority under the
Luxembourg Act dated 10 July 2005 on prospectuses for securities (the ``Luxembourg Law'') to approve this document as a base prospectus. The
CSSF assumes no responsibility as to the economic and financial soundness of the Programme or in respect of the quality or solvency of ENBD or EGF
pursuant to Article 7(7) of the Luxembourg Law. Application has also been made to the Luxembourg Stock Exchange for Notes issued under the
Programme to be admitted to trading on the Luxembourg Stock Exchange's regulated market (the ``Regulated Market'') and to be listed on the official
list (the ``Official List'') of the Luxembourg Stock Exchange, during the period of 12 months from the date of this Base Prospectus.
References in this Base Prospectus to Notes being ``listed'' (and all related references) shall mean that such Notes have been admitted to listing on the
Official List and admitted to trading on the Regulated Market which is a regulated market for the purposes of Directive 2004/39/EC (the Markets in
Financial Instruments Directive).
Notice of the aggregate nominal amount of Notes, interest (if any) payable in respect of Notes, the issue price of Notes and any other terms and
conditions not contained herein which are applicable to each Tranche (as defined under ``Terms and Conditions of the Notes'') of Notes will be set out
in a final terms (the ``Final Terms'') which, with respect to Notes to be listed on the Luxembourg Stock Exchange, will be filed with the CSSF.
The Programme provides that Notes may be listed or admitted to trading, as the case may be, on such other or further stock exchanges or markets as
may be agreed between each relevant Obligor and the relevant Dealer. The Issuers may also issue unlisted Notes and/or Notes not admitted to trading
on any market.
Each relevant Obligor may agree with any Dealer that Notes may be issued in a form not contemplated by the Terms and Conditions of the Notes
herein, in which event a supplement to the Base Prospectus, in the case of listed Notes only, if appropriate, will be made available which will describe
the effect of the agreement reached in relation to such Notes.
The rating of certain Tranches of Notes to be issued under the Programme may be specified in the applicable Final Terms. Whether or not each credit
rating applied for in relation to the relevant Tranche of Notes will be issued by a credit rating agency established in the European Union and registered
under Regulation (EC) No. 1060/2009 (as amended by Regulation (EU) No. 513/2011, the ``CRA Regulation'') will be disclosed in the Final Terms. The
list of registered and certified rating agencies published by the European Securities and Markets Authority (ESMA) on its website in accordance with the
CRA Regulation is not conclusive evidence of the status of the relevant rating agency included in such list, as there may be delays between certain
supervisory measures being taken against a relevant rating agency and the publication of the updated ESMA list. Each of Fitch Ratings Ltd. (``Fitch'')
and Moody's Investors Service Limited (``Moody's'') has rated the Programme. The Programme has been rated A+ by Fitch and A3 by Moody's. For
further information on credit rating agencies see page (v) of this Base Prospectus.
Arranger
Deutsche Bank
Dealers
Barclays Capital
BNP PARIBAS
BofA Merrill Lynch
Citigroup
Commerzbank
Cre´dit Agricole CIB
Credit Suisse
Deutsche Bank
Emirates NBD
HSBC
ING Commercial Banking
J.P. Morgan
Morgan Stanley
Nomura
SMBC Nikko
Socie´te´ Ge´ne´rale Corporate & Investment Banking
Standard Chartered Bank
The Royal Bank of Scotland
UBS Investment Bank
The date of this Base Prospectus is 22 December 2011

This Base Prospectus comprises two base prospectuses for the purposes of Article 5.4 of
Directive 2003/71/EC (the ``Prospectus Directive'') as amended (which includes the amendment
made by Directive 2010/73/EU (the 2010 Amending Directive) to the extent that such amendments
have been implemented in a Relevant Member State of the European Economic Area).
Each of ENBD and EGF accepts responsibility for the information contained in this Base
Prospectus. To the best of the knowledge of each of ENBD and EGF (each having taken all
reasonable care to ensure that such is the case) the information contained in this Base Prospectus
is in accordance with the facts and does not omit anything likely to affect the import of such
information.
This Base Prospectus is to be read and construed in conjunction with any supplement hereto and
with all documents which are incorporated herein by reference (see ``Documents Incorporated by
Reference'') and, in relation to any Notes, should be read and construed together with the
applicable Final Terms.
Certain information contained in ``Risk Factors'', ``Description of Emirates NBD PJSC ENBD's
Competition'', ``Overview of the UAE and the Emirate of Dubai'' and ``The United Arab Emirates
Banking and Financial Services System'' (as indicated therein) has been extracted from
independent, third party sources. Each of ENBD and EGF confirms that such information has been
accurately reproduced and that, as far as it is aware and is able to ascertain from information
published by the relevant, third party sources, no facts have been omitted which would render the
reproduced information inaccurate or misleading.
The Dealers have not independently verified the information contained herein. Accordingly, no
representation, warranty or undertaking, express or implied, is made and no responsibility or
liability is accepted by the Dealers as to the accuracy or completeness of the information
contained or incorporated in this Base Prospectus or any other information provided by any of
ENBD or EGF in connection with the Programme. No Dealer accepts any liability in relation to the
information contained or incorporated by reference in this Base Prospectus or any other
information provided by any of ENBD or EGF in connection with the Programme.
No person is or has been authorised by ENBD or EGF to give any information or to make any
representation not contained in or not consistent with this Base Prospectus or any other
information supplied in connection with the Programme or the Notes and, if given or made, such
information or representation must not be relied upon as having been authorised by ENBD or EGF
or any of the Dealers.
Neither this Base Prospectus nor any other information supplied in connection with the
Programme or any Notes (i) is intended to provide the basis of any credit or other evaluation or (ii)
should be considered as a recommendation by ENBD or EGF or any of the Dealers that any
recipient of this Base Prospectus or any other information supplied in connection with the
Programme or any Notes should purchase any Notes. Each investor contemplating purchasing any
Notes should make its own independent investigation of the financial condition and affairs, and its
own appraisal of the creditworthiness, of the relevant Obligor(s). Neither this Base Prospectus nor
any other information supplied in connection with the Programme or the issue of any Notes
constitutes an offer or invitation by or on behalf of ENBD or EGF or any of the Dealers to any
person to subscribe for or to purchase any Notes.
Neither the delivery of this Base Prospectus nor the offering, sale or delivery of any Notes shall in
any circumstances imply that the information contained herein concerning ENBD or EGF is correct
at any time subsequent to the date hereof or that any other information supplied in connection
with the Programme is correct as of any time subsequent to the date indicated in the document
containing the same. The Dealers expressly do not undertake to review the financial condition or
affairs of any of ENBD or EGF during the life of the Programme or to advise any investor in the
Notes of any information coming to their attention. Investors should review, inter alia, the most
recently published documents incorporated by reference into this Base Prospectus when deciding
whether or not to purchase any Notes.
The Notes have not been and will not be registered under the United States Securities Act of
1933, as amended, (the ``Securities Act'') and are subject to U.S. tax law requirements. Subject
to certain exceptions, Notes may not be offered, sold or delivered within the United States or to,
or for the account or benefit of, U.S. persons (see ``Subscription and Sale'').
ii
c105985pu010
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

This Base Prospectus does not constitute an offer to sell or the solicitation of an offer to buy any
Notes in any jurisdiction to any person to whom it is unlawful to make the offer or solicitation in
such jurisdiction. The distribution of this Base Prospectus and the offer or sale of Notes may be
restricted by law in certain jurisdictions. The Issuers, the Guarantor and the Dealers do not
represent that this Base Prospectus may be lawfully distributed, or that any Notes may be lawfully
offered, in compliance with any applicable registration or other requirements in any such
jurisdiction, or pursuant to an exemption available thereunder, or assume any responsibility for
facilitating any such distribution or offering. In particular, no action has been taken by the Issuers,
the Guarantor or the Dealers which is intended to permit a public offering of any Notes or
distribution of this Base Prospectus in any jurisdiction where action for that purpose is required.
Accordingly, no Notes may be offered or sold, directly or indirectly, and neither this Base
Prospectus nor any advertisement or other offering material may be distributed or published in any
jurisdiction, except under circumstances that will result in compliance with any applicable laws and
regulations. Persons into whose possession this Base Prospectus or any Notes may come must
inform themselves about, and observe, any such restrictions on the distribution of this Base
Prospectus and the offering and sale of Notes. In particular, there are restrictions on the
distribution of this Base Prospectus and the offer or sale of Notes in the United States, the
European Economic Area (including the United Kingdom, the Republic of Italy and France), Japan,
the Dubai International Financial Centre, the Kingdom of Saudi Arabia, The United Arab Emirates
and the Cayman Islands (see ``Subscription and Sale'').
This Base Prospectus has not been submitted for clearance to the Autorite´ des marche´s financiers
in France.
Certain figures and percentages included in this Base Prospectus have been subject to rounding
adjustments. Accordingly, figures shown in the same category presented in different tables may
vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of
the figures which precede them.
All references in this document to ``U.S. dollars'', ``U.S.$'' and ``$'' refer to United States dollars,
to ``Dirham'' and ``AED'' refer to United Arab Emirates Dirham, to ``euro'' and ``e'' refer to the
currency introduced at the start of the third stage of European economic and monetary union
pursuant to the Treaty establishing the European Community, as amended and all references to
``CNY'', ``Renminbi'' and ``RMB'' are to the lawful currency of the People's Republic of China
(the ``PRC'') which, for the purposes of this Base Prospectus, excludes the Hong Kong Special
Administrative Region of the PRC, the Macao Special Administriative Region of the PRC and
Taiwan. In addition, all references in this document to ``UAE'' are to the United Arab Emirates.
This Base Prospectus includes forward-looking statements. All statements other than statements
of historical facts included in this Base Prospectus may constitute forward-looking statements.
Forward-looking statements generally can be identified by the use of forward-looking terminology,
such as ``may'', ``will'', ``expect'', ``intend'', ``estimate'', ``anticipate'', ``believe'', ``continue'' or
similar terminology. Although EGF and ENBD believe that the expectations reflected in their
forward-looking statements are reasonable at this time, there can be no assurance that these
expectations will prove to be correct.
IN CONNECTION WITH THE ISSUE OF ANY TRANCHE OF NOTES, THE DEALER OR DEALERS
(IF ANY) NAMED AS THE STABILISING MANAGER(S) (OR PERSONS ACTING ON BEHALF OF
ANY STABILISING MANAGER(S)) IN THE APPLICABLE FINAL TERMS MAY OVER-ALLOT NOTES
OR EFFECT TRANSACTIONS WITH A VIEW TO SUPPORTING THE MARKET PRICE OF THE
NOTES AT A LEVEL HIGHER THAN THAT WHICH MIGHT OTHERWISE PREVAIL. HOWEVER,
THERE IS NO ASSURANCE THAT THE STABILISING MANAGER(S) (OR PERSONS ACTING ON
BEHALF OF A STABILISING MANAGER) WILL UNDERTAKE STABILISATION ACTION. ANY
STABILISATION ACTION MAY BEGIN ON OR AFTER THE DATE ON WHICH ADEQUATE PUBLIC
DISCLOSURE OF THE TERMS OF THE OFFER OF THE RELEVANT TRANCHE OF NOTES IS
MADE AND, IF BEGUN, MAY BE ENDED AT ANY TIME, BUT IT MUST END NO LATER THAN
THE EARLIER OF 30 DAYS AFTER THE ISSUE DATE OF THE RELEVANT TRANCHE OF NOTES
AND 60 DAYS AFTER THE DATE OF THE ALLOTMENT OF THE RELEVANT TRANCHE OF
NOTES. ANY STABILISATION ACTION OR OVER-ALLOTMENT MUST BE CONDUCTED BY THE
RELEVANT
STABILISING
MANAGER(S)
(OR
PERSONS
ACTING
ON
BEHALF
OF
ANY
STABILISING MANAGER(S)) IN ACCORDANCE WITH ALL APPLICABLE LAWS AND RULES.
iii
c105985pu010
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

KINGDOM OF SAUDI ARABIA NOTICE
This Base Prospectus may not be distributed in the Kingdom of Saudi Arabia except to such
persons as are permitted under the Offers of Securities Regulations issued by the Capital Market
Authority of the Kingdom of Saudi Arabia (the ``Capital Market Authority'').
The Capital Market Authority does not make any representations as to the accuracy or
completeness of this Base Prospectus, and expressly disclaims any liability whatsoever for any
loss arising from, or incurred in reliance upon, any part of this Base Prospectus. Prospective
purchasers of Notes issued under the Programme should conduct their own due diligence on the
accuracy of the information relating to the Notes. If a prospective purchaser does not understand
the contents of this Base Prospectus he or she should consult an authorised financial adviser.
THE CREDIT RATING AGENCIES
Each of Fitch and Moody's has rated ENBD and Moody's has also rated the UAE. See pages i, 21
and 110.
Both Fitch and Moody's are established in the European Union and are registered under the CRA
Regulation.
iv
c105985pu010
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

CONTENTS
Page
RISK FACTORS ...................................................................................................................
1
DOCUMENTS INCORPORATED BY REFERENCE .............................................................
16
GENERAL DESCRIPTION OF THE PROGRAMME.............................................................
17
FORM OF THE NOTES.......................................................................................................
23
APPLICABLE FINAL TERMS...............................................................................................
26
TERMS AND CONDITIONS OF THE NOTES .....................................................................
39
THE GUARANTEE...............................................................................................................
71
USE OF PROCEEDS ...........................................................................................................
77
DESCRIPTION OF EMIRATES NBD PJSC..........................................................................
78
DESCRIPTION OF EMIRATES NBD GLOBAL FUNDING LIMITED ....................................
106
OVERVIEW OF THE UAE AND THE EMIRATE OF DUBAI ................................................
107
THE UNITED ARAB EMIRATES BANKING AND FINANCIAL SERVICES SYSTEM............
115
TAXATION...........................................................................................................................
121
SUBSCRIPTION AND SALE................................................................................................
124
GENERAL INFORMATION..................................................................................................
129
v

RISK FACTORS
The Obligors believe that the following factors may affect their ability to fulfil their obligations
under the Notes issued under the Programme or under the Guarantee, as the case may be. All of
these factors are contingencies which may or may not occur and the Obligors are not in a position
to express a view on the likelihood of any such contingency occurring.
In addition, factors which are material for the purpose of assessing the market risks associated
with Notes issued under the Programme are also described below.
The Obligors believe that the factors described below represent the principal risks inherent in
investing in Notes issued under the Programme, but the inability of the Obligors to pay interest,
principal or other amounts on or in connection with any Notes or to pay any amount in respect of
the Guarantee, as the case may be, may occur for other reasons and the Obligors do not
represent that the statements below regarding the risks of holding any Notes are exhaustive.
Prospective investors should also read the detailed information set out elsewhere in this Base
Prospectus and reach their own views prior to making any investment decision.
Words and expressions defined in ``Form of the Notes'' and ``Terms and Conditions of the Notes''
shall have the same meanings in this section.
Factors that may affect EGF's ability to fulfil its obligations under Notes issued under the
Programme
EGF has no operating history and no material assets
At the date of this Base Prospectus, EGF is an exempted company with limited liability,
incorporated under the laws of the Cayman Islands on 3 July 2009 and has no operating history.
EGF will not engage in any business activity other than the issuance of Notes under this
Programme and other borrowing programmes established from time to time by ENBD, the
issuance of shares in its capital and other activities incidental or related to the foregoing. EGF is
not expected to have any income except payments received from ENBD, which will be the only
material sources of funds available to meet the claims of the Noteholders. As a result, EGF is
subject to all of the risks to which ENBD is subject, to the extent that such risk could limit
ENBD's ability to satisfy in full and on a timely basis its obligations to EGF under the Programme.
As EGF is a Cayman Islands company, it may not be possible for Noteholders to effect service of
process outside of the Cayman Islands.
Factors that may affect ENBD's ability to, in its capacity as Issuer, fulfil its obligations under
Notes issued under the Programme and to, in its capacity as Guarantor, fulfil its obligations
under the Guarantee
Principal shareholder and governmental interests
As at the date of this Base Prospectus, the Government of Dubai indirectly holds 55.64 per cent.
of the share capital of ENBD. Investment Corporation of Dubai (``ICD''), which is wholly owned by
the Government of Dubai, holds shares in ENBD directly. However, the Government of Dubai does
not explicitly or implicitly guarantee the financial obligations of ENBD (including in respect of the
Notes to be issued under the Programme and the Guarantee) nor does it, like any other
shareholder (acting through ICD), have any legal obligation to provide any support or additional
funding for any of ENBD's future operations.
Investors should also be aware that in June 2009, EBI issued AED 4 billion of Tier 1 securities to
ICD in order to help satisfy the requirements of the Central Bank of the UAE (the ``UAE Central
Bank''). Following the amalgamation of EBI and National Bank of Dubai PJSC (``NBD'') with
ENBD, described further at ``Description of Emirates NBD PJSC'' below, ENBD is now considered
to be the issuer of the securities.
However, notwithstanding the Tier 1 securities issued to ICD described in the previous paragraph,
the funding support received from the UAE Federal Government during the difficult period of the
global financial crisis that occurred from late 2008 to early 2009 and the conversion of AED 12.6
billion of deposits from the UAE Federal Government with ENBD into Tier 2 capital in March 2009
(see `` Capital Adequacy'' under ``Description of Emirates NBD PJSC'' below), neither the
Government of Dubai nor the UAE Federal Government are under any obligation to continue to
invest in, make deposits with, do business with or otherwise support ENBD. The Government of
Dubai and the UAE Federal Government may, whether directly or through government-owned
1
c105985pu020
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

entities, at any time and for any reason, dispose of its investments in, withdraw its deposits from,
cease to do business with or otherwise cease to support ENBD. The reduction or elimination of
governmental support could have a material adverse effect on the business, results of operations,
financial condition and prospects of ENBD.
Competition
Generally, the banking market in the UAE has been a relatively protected market with high
regulatory and other barriers to entry for foreign financial institutions. However, should some of
these barriers be removed or eased in the future, either voluntarily or as a result of the UAE's
obligations to the World Trade Organisation (the ``WTO''), the Gulf Cooperation Council (the
``GCC'') or any other similar entities, it is likely to lead to a more competitive environment for
ENBD and other domestic financial institutions. Such increase in competition could have a material
adverse effect on the business, results of operations, financial condition and prospects of ENBD
(see also ``Description of Emirates NBD PJSC ENBD's Competition'' below).
Foreign exchange movements may adversely affect the profitability of ENBD
ENBD maintains its accounts and reports its results in AED. The UAE dirham has been pegged at
a fixed exchange rate to the U.S. dollar since 22 November 1980. ENBD is exposed to the
potential impact of any alteration to or abolition of this foreign exchange peg.
Majority of business in the UAE
ENBD has the majority of its operations and assets in the UAE and accordingly its business may
be affected by the financial, political and general economic conditions prevailing from time to time
in the UAE and/or the Middle East generally.
These markets are subject to greater risks than more developed markets, including in some cases
significant legal, economic and political risks. Accordingly, investors should exercise particular care
in evaluating the risks involved and must decide for themselves whether, in the light of those
risks, their investment is appropriate. Generally, investment is only suitable for sophisticated
investors who fully appreciate the significance of the risk involved (see also `` Risks factors
relating to the UAE and the Middle East Political, economic and related considerations'' below).
Importance of key personnel
ENBD's ability to maintain and grow its business will depend, in part, on its ability to continue to
recruit and retain qualified and experienced banking and management personnel. ENBD may face
challenges in recruiting and retaining qualified personnel to manage its business from time to time
and, if it is to continue to grow, will need to continue to increase its employee numbers.
Additionally, the UAE Federal Government has a recommended policy that at least 4 per cent. of
the total employees (each year) of companies operating in the UAE must be UAE nationals. In
common with other banks in the UAE, ENBD experiences a shortage of, and competition to
recruit and retain, qualified UAE national employees. If ENBD is unable to meet or exceed the
UAE Federal Government's recommended policy for recruiting UAE nationals, it may be subject to
legal penalties including with respect to its current licences, and may be prevented from obtaining
additional licences necessary in order to allow it to expand its business. Due to UAE federal labour
laws, ENBD may also face difficulties that could delay or prevent dismissal of underperforming
UAE national employees.
While ENBD currently meets (and exceeds) the UAE Federal Government's ``Emiratisation''
requirements (in particular, see ``Description of Emirates NBD PJSC Emiratisation'') and believes
that it has effective staff recruitment, training and incentive programmes in place, if it was unable
to retain key members of its senior management and/or remove under performing staff and/or hire
new qualified personnel in a timely manner, this could have a material adverse effect on its
business, results of operations, financial condition and prospects.
Risks relating to the business of ENBD
Market risks
In the course of its business activities, ENBD is exposed to a variety of risks, the most significant
of which are market risks, liquidity risks, credit risks and operational risks.
In the last two years in particular, difficult macro-economic and financial market conditions have
affected and could continue to materially adversely affect ENBD's business.
2
c105985pu020
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

Since the second half of 2007, disruptions in global capital and credit markets, coupled with the
re-pricing of credit risk and the deterioration of the real estate markets in the United States,
Europe, the UAE, the other countries of the GCC and elsewhere, have created difficult conditions
in the financial markets. These conditions have resulted in historically high levels of volatility across
many markets (including capital markets) and the failures of a number of financial institutions in
the United States and Europe. Further market disruption may be caused by certain European
countries experiencing debt servicing problems.
The countries of the GCC were affected by the global financial crisis in the second half of 2007,
however, the most significant adverse effects only impacted the region in the second half of 2008.
Since then, there has been a significant slowdown or reversal of the high growth rates that had
been experienced by many countries within the GCC and the UAE, especially in Dubai (as
described further in the next paragraph). Consequently, certain sectors of the GCC economy that
had benefited from the high rate of growth, such as real estate, construction and financial
institutions, have been materially adversely affected by the crisis.
During the second half of 2008 and into 2009, world oil prices fell by approximately 70 per cent.
from their peak level of U.S.$137 per barrel of Murban crude oil reached in July 2008 to around
U.S.$45 per barrel in February 2009, before returning to above U.S.$100 per barrel in February
2011. Oil prices remain volatile and have the potential to adversely affect the UAE economy in the
future. In addition, the credit crisis in the global financial markets, which was particularly acute in
2008 and 2009, and the resultant deterioration in the global economic outlook led to a general
reduction in liquidity and available financing and generally increased financing costs. These events
affected Dubai and the UAE in a number of ways. First, gross domestic product (``GDP'') was
adversely affected in 2009 reflecting the significant contributions of the oil and gas sector to the
UAE's GDP and, in the case of Dubai, through the impact of these events on the construction and
real estate sectors. Second, the UAE's trade surplus declined in 2009 reflecting the reduced value
of hydrocarbon exports and its current account balance was additionally impacted as a result of
declining services receipts and lower investment income. Third, certain ``government related
entities'' wholly or substantially owned by the Government of Dubai have suffered from asset
value deterioration and limited cash flow. Although Dubai enjoys a relatively diverse economy, with
the oil and gas sector accounting for less than two per cent. of Dubai's GDP in 2010, any
significant impact on international oil prices may have a negative impact on regional spending and
liquidity and consequently is likely to affect Dubai's economy indirectly through its impact on the
trade, construction, real estate, tourism and banking sectors in particular, given also the openness
of the economy with no capital or exchange controls.
In response to the global financial crisis, governments and regulators in the UAE, Europe, the
United States and other jurisdictions enacted legislation and took measures intended to help
stabilise the financial system and increase the flow of credit to their economies. These measures
included recapitalisation through the purchase of securities issued by financial institutions (including
ordinary shares, preferred shares, or other hybrid or quasi-equity instruments), guarantees by
governments outside of the UAE of debt issued by financial institutions, and government-
sponsored mergers and acquisitions of and divestments by financial institutions. There can be no
assurance that any or all of these measures will continue to positively affect volatility and credit
availability or that governments will continue to support recovery in this way.
Whilst ENBD believes that it has implemented the appropriate policies, systems and processes to
control and mitigate these risks (please see ``Description of Emirates NBD PJSC Risk
Management''), investors should note that a worsening of current financial market conditions could
lead to further decreases in investor and consumer confidence, further market volatility and
decline, further economic disruption and, as a result, could have an adverse effect on the
business, results of operations, financial condition and prospects of each of the Issuers and the
Guarantor irrespective of steps currently taken to adequately control these risks.
Liquidity risks
Liquidity risks could arise from the inability of ENBD to anticipate and provide for unforeseen
decreases or changes in funding sources which could have adverse consequences on the ability of
ENBD to meet its obligations when they fall due.
Since the second half of 2008, a liquidity crisis has existed in the global credit markets which
initially arose because of a large number of borrower defaults in the sub-prime mortgage loan
3
c105985pu020
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

market in the United States of America, but which has expanded to affect all levels of the
international economy.
Liquidity is essential to the business of ENBD and the UAE financial markets have shown
comparatively reduced levels of liquidity since the third quarter of 2008. In response, the UAE
Ministry of Finance and the UAE Central Bank have taken a number of measures (UAE Ministry of
Finance deposits and UAE Central Bank funding support) in an attempt to improve the liquidity
levels in Dubai and the UAE. However, there is no guarantee that levels of liquidity will continue
to improve indefinitely and will not deteriorate.
Credit risks
Credit risks arising from adverse changes in the credit quality and recoverability of loans/financing
receivables, advances and amounts due from counterparties are inherent in the business of ENBD.
Credit risks could arise from a deterioration in the credit quality of specific counterparties of
ENBD, from a general deterioration in local or global economic conditions or from systemic risks
with the financial systems, all of which could affect the recoverability and value of the assets of
ENBD and which could cause an increase in the provisions for the impairment of its assets and
other credit exposures.
As mentioned above under `` Risks relating to the business of ENBD'', the UAE economy has
been negatively impacted by the global economic downturn, which has affected some of the
UAE's key economic sectors including trade, tourism, real estate and commerce. As a result of
these recent adverse market conditions, certain of the customers to which ENBD directly extends
credit and counterparties of ENBD have experienced, and may continue to experience, decreased
revenues, financial losses, insolvency, difficulty in obtaining access to financing, increased funding
costs and problems servicing their debt obligations or other expenses as they become due.
Accordingly, ENBD may experience a higher level of credit defaults (including impaired loans and
consequential increases in impairment allowances for doubtful loans and advances) in the
immediate future, which could have a material adverse effect on its financial condition and results
of operations.
Operational risks
Operational risks and losses can result from fraud, error by employees, failure to document
transactions properly or to obtain proper internal authorisation, failure to comply with regulatory
requirements and conduct of business rules, the failure of internal systems, equipment and
external systems and occurrence of natural disasters. Although ENBD has implemented risk
controls and loss mitigation strategies and substantial resources are devoted to developing
efficient procedures, it is not possible to eliminate any of the operational risks entirely, which
could have a material adverse effect on its financial condition and results of operations.
Notwithstanding anything in this operational risks risk factor, this risk factor should not be taken as
implying that ENBD will be unable to comply with its obligations as a company with securities
admitted to the Official List and its obligations as a supervised firm regulated by the CSSF.
Concentration risk
Concentrations in the loan/financing receivable and deposit portfolio of ENBD subject it to risks
from default by its larger borrowers, from exposure to particular sectors of the UAE economy and
from withdrawal of large deposits. The loans and receivables/finance receivables portfolio of ENBD
shows industry and borrower concentration.
The ten largest private sector borrowers (which excludes those borrowers which are either wholly
or majority owned by the Government of Dubai or the Ruler of Dubai, H.H. Sheikh Mohammed bin
Rashid Al Maktoum) of ENBD and its subsidiaries (together with ENBD, the ``Group'') represented
8 per cent. of its total loans and receivables as at 30 September 2011. As at 30 September 2011,
the ENBD's largest funded exposure to a private sector borrower was AED 3.7 billion, which
constitutes 2 per cent. of its total loans and receivables (as at 30 September 2011) and 8 per
cent. of its total regulatory capital (total regulatory capital being AED 45.4 billion as at 30
September 2011).
In terms of the industry concentration of the Group's total credit risk portfolio, as at 30 September
2011, banks and financial institutions accounted for 16 per cent., construction and real estate
combined accounted for 16 per cent., trade and manufacturing accounted for 7 per cent.,
4
c105985pu020
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

government accounted for 30 per cent., personal finance accounted for 16 per cent. and other
sectors accounted for 15 per cent.
As at 30 September 2011, the Group's wholesale banking customers represented 41.7 per cent.
of its combined total deposits. Although ENBD considers that it has adequate access to sources
of funding, the withdrawal of a significant portion of these large deposits may have an adverse
effect on ENBD's financial condition or results of operations as well as its ability to meet the UAE
Central Bank target stable resources ratio of 100 per cent. A downturn in the fortunes of any of
ENBD's depositors, or in the sectors in which they operate, could have a material adverse effect
on the financial condition or results of operations of ENBD.
Real estate exposure
As at 30 September 2011, exposures to real estate and construction constituted 13.0 per cent.
and 3.0 per cent., respectively, of the Group's total credit risk portfolio. The Group's total funded
real estate and construction exposure stood at AED 30.3 billion.
Since the middle of 2008, a number of real estate projects in Dubai have been cancelled or
delayed, principally reflecting liquidity shortages for developers, decreasing headline real estate
prices and rental rates, and increasing market uncertainty and negative sentiment. These factors
adversely affected real GDP growth rates in the real estate and construction sectors in 2008, 2009
and 2010. According to Dubai's Real Estate Regulatory Authority (``RERA''), of the total number of
registered projects at 31 May 2011, 129 projects have been completed since the beginning of
2009. In the last two years, RERA has additionally completed a review of more than 450 projects
and, of these reviewed projects, 237 are expected to be completed in due course. 217 registered
projects have been cancelled by RERA as at 31 May 2011.
Since late 2008 a real estate correction has been taking place in Dubai's real estate market such
that, according to the Colliers International House Price Index published in the fourth quarter of
2010, the average price of residential property in Dubai decreased by 50 per cent. between the
third quarter of 2008 and the fourth quarter of 2010. Further, according to a report entitled ``Dubai
Real Estate Market Overview'' published by Jones Lang LaSalle in the second quarter of 2011, the
average prime rentals price for commercial office property in Dubai fell by approximately 63 per
cent. between the fourth quarter of 2008 and the first quarter of 2011. However, the average
price of prime rentals has stabilised between the first quarter of 2011 and the second quarter of
2011, at AED 1,615 per square metre.
In addition to the decline in property values, the economic downturn in Dubai has also led to a
significant decrease in property sales volumes. Figures from the Dubai Land Department for 2009
show that there were 1,924 land transactions with a combined value of AED 18.08 billion.
However, although 2010 saw an increase in the number of sale transactions to 2,105, the
combined value of such transactions fell to AED 14.37 billion, representing an approximately 21
per cent. decline in the total value of sale transactions completed between 2009 and 2010.
A further real estate correction or default of ENBD's main real estate-related clients could have a
material adverse effect on the financial condition and results of operation of ENBD.
Changes in Accounting Policies
Potential future changes to accounting policies or reclassifications could have a material adverse
effect on the financial condition or results of operation of ENBD.
Risk factors relating to the UAE and the Middle East
Political, economic and related considerations
While the UAE has historically enjoyed significant economic growth and relative political stability,
there can be no assurance that such growth or stability will continue. Investors should note that
ENBD's businesses and financial performance may be affected by the financial, political and
general economic conditions prevailing from time to time in the UAE and the Middle East.
The UAE is seen as a relatively stable political environment with generally healthy international
relations. However, as a country located in the Middle East and North Africa (``MENA'') region,
there is a risk that regional geopolitical instability could impact the UAE and it should be noted
that in the first half of 2011 there was significant political and social unrest, including violent
protests and armed conflict, in a number of countries in the MENA region. The situation has
caused significant disruption to the economies of affected countries and has had a destabilising
5
c105985pu020
Proof
4:
22.12.11_10:24
B/L
Revision:
0
Operator
DadA

Document Outline

#1">c105985pu010.pdf
#6">c105985pu020.pdf
#31">c105985pu030.pdf
#44">c105985pu040.pdf
#76">c105985pu050.pdf
#111">c105985pu060.pdf