Bond ING Groep N.V. 0% ( XS1258875118 ) in EUR

Issuer ING Groep N.V.
Market price 100 %  ▲ 
Country  Netherlands
ISIN code  XS1258875118 ( in EUR )
Interest rate 0%
Maturity 16/01/2017 - Bond has expired



Prospectus brochure of the bond ING BANK N.V XS1258875118 in EUR 0%, expired


Minimal amount /
Total amount /
Detailed description ING Bank N.V. is a multinational banking and financial services corporation headquartered in Amsterdam, Netherlands, offering a wide range of services including retail banking, wholesale banking, and investment banking globally.

The Bond issued by ING Groep N.V. ( Netherlands ) , in EUR, with the ISIN code XS1258875118, pays a coupon of 0% per year.
The coupons are paid 4 times per year and the Bond maturity is 16/01/2017







ING Groep N.V.
(Incorporated in The Netherlands with its statutory seat in Amsterdam)
ING Bank N.V.
(Incorporated in The Netherlands with its statutory seat in Amsterdam)
55,000,000,000
Debt Issuance Programme
Under this 55,000,000,000 Debt Issuance Programme (the "Programme"), each of ING Groep N.V. ("ING" or "ING Group") and ING Bank
N.V. ("ING Bank") (together the "Issuers" and each an "Issuer", which expression shall include any Substituted Debtor (as defined in Condition
16 of the Terms and Conditions of the Notes)), may from time to time issue notes (the "Notes" as more fully defined below)) which may be PD
Notes or Exempt Notes (each as defined below).
This Base Prospectus was approved by the Netherlands Authority for the Financial Markets (the "AFM") for the purposes of the Prospectus
Directive (Directive 2003/71/EC), as amended, to the extent that such amendments have been implemented in the relevant Member State of the
European Economic Area, (the "Prospectus Directive") on 12 May 2015 in respect of the issue by the Issuers of PD Notes (as defined below).
The AFM has provided the competent authority in Luxembourg with a certificate of approval attesting that this Base Prospectus has been drawn
up in accordance with the Prospectus Directive.
Notes to be issued under the Programme during the period of twelve months from the date of this Base Prospectus which are:
(a) issued with a minimum denomination of at least 100,000 (or its equivalent in any other currency at the date of issue of the Notes); and
(b) (i) admitted to trading on Euronext in Amsterdam, a regulated market of Euronext Amsterdam N.V. ("Euronext Amsterdam"); (ii) admitted
to the official list of the Luxembourg Stock Exchange (the "Official List"); (iii) admitted to trading on the regulated market of the Luxembourg
Stock Exchange (the "Luxembourg Stock Exchange"); or (iv) admitted to trading on another regulated market within the European Economic
Area,
are hereinafter referred to as "PD Notes".
The Issuers may also issue unlisted Notes and/or Notes not admitted to trading on a regulated market within the European Economic Area and,
where such Notes are, in addition, issued with a minimum denomination of at least 100,000 (or its equivalent in any other currency at the date
of issue of the Notes) or otherwise fall within an exemption from the requirement to publish a prospectus under the Prospectus Directive, such
Notes are hereinafter referred to as "Exempt Notes".
The AFM has neither approved nor reviewed information contained in this Base Prospectus in connection with the issue of any Exempt
Notes.
The Programme has been approved by the SIX Swiss Exchange Ltd (the "SIX Swiss Exchange") as an "issuance programme" for the listing of
bonds in accordance with the listing rules of the SIX Swiss Exchange. Application may be made to list Notes issued by ING Bank under the
Programme on the SIX Swiss Exchange during the period of twelve months from the date of this Base Prospectus.
Prospective investors should have regard to the factors described under the section headed "Risk Factors" in this Base Prospectus.
This Base Prospectus should be read and construed in conjunction with the relevant Registration Document (as defined herein) in
connection with the issue of Notes.
Arranger
ING
Dealer
ING
BASE PROSPECTUS
Dated 12 May 2015


Table of Contents
RISK FACTORS ................................................................................................................................................ 4
DOCUMENTS INCORPORATED BY REFERENCE.................................................................................... 13
OVERVIEW OF THE PROGRAMME............................................................................................................ 15
NOMINAL AMOUNT OF THE PROGRAMME............................................................................................ 26
FORM OF THE NOTES.................................................................................................................................. 27
DTC INFORMATION -- REGISTERED NOTES.......................................................................................... 33
TERMS AND CONDITIONS OF THE NOTES ............................................................................................. 35
FORM OF FINAL TERMS OF THE NOTES ................................................................................................. 65
USE OF PROCEEDS....................................................................................................................................... 79
TAXATION...................................................................................................................................................... 80
ERISA AND CERTAIN OTHER U.S. CONSIDERATIONS .........................................................................105
SUBSCRIPTION AND SALE ........................................................................................................................107
ADDITIONAL CANADIAN INFORMATION..............................................................................................120
GENERAL INFORMATION..........................................................................................................................126
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RISK FACTORS
General Risk Factors
Introduction
This Base Prospectus identifies in a general way the information that a prospective investor should consider
prior to making an investment in the Notes. However, a prospective investor should conduct its own thorough
analysis (including its own accounting, legal and tax analysis) prior to deciding whether to invest in the Notes
as any evaluation of the suitability for an investor of an investment in the Notes depends upon a prospective
investor's particular financial and other circumstances, as well as on specific terms of the Notes. This Base
Prospectus is not, and does not purport to be, investment advice or an investment recommendation to
purchase the Notes. Each Issuer, including its branches and any group company, is acting solely in the
capacity of an arm's length contractual counterparty and not as a purchaser's financial adviser or fiduciary in
any transaction, unless such Issuer has agreed to do so in writing. If a prospective investor does not have
experience in financial, business and investment matters sufficient to permit it to make such a determination,
the investor should consult with its financial adviser prior to deciding to make an investment on the suitability
of the Notes. Investors risk losing their entire investment or part of it.
Each prospective investor of Notes must determine, based on its own independent review and such
professional advice as it deems appropriate under the circumstances, that its acquisition of the Notes (i) is
fully consistent with its (or, if it is acquiring the Notes in a fiduciary capacity, the beneficiary's) financial
needs, objectives and condition, (ii) complies and is fully consistent with any investment policies, guidelines
and restrictions applicable to it (whether acquiring the Notes as principal or in a fiduciary capacity) and (iii) is
a fit, proper and suitable investment for it (or, if it is acquiring the Notes in a fiduciary capacity, for the
beneficiary). In particular, investment activities of certain investors are subject to investment laws and
regulations, or review or regulation by certain authorities. Each prospective investor should therefore consult
its legal advisers to determine whether and to what extent (i) the Notes are legal investments for it, (ii) the
Notes can be used as underlying securities for various types of borrowing and (iii) other restrictions apply to
its purchase or pledge of any Notes.
Financial institutions should consult their legal advisers or the appropriate regulators to determine the
appropriate treatment of Notes under any applicable risk-based capital or similar rules.
Each prospective investor in Notes should refer to the section headed "Risk Factors" in the relevant
Registration Document for a description of those factors which could affect the financial performance of
the Issuers and thereby affect the Issuers' ability to fulfil their obligations in respect of Notes issued under
the Programme.
The Notes may not be a suitable investment for all investors
Each potential investor in the Notes must determine the suitability of that investment in light of its own
circumstances. In particular, each potential investor should:
(i)
have sufficient knowledge and experience to make a meaningful evaluation of the Notes, the merits
and risks of investing in the Notes and the information contained or incorporated by reference in this
Base Prospectus or any applicable supplement or Final Terms;
(ii)
have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its
particular financial situation, an investment in the Notes and the impact the Notes will have on its
overall investment portfolio;
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(iii)
have sufficient financial resources and liquidity to bear all of the risks of an investment in the Notes,
including Notes with principal or interest payable in one or more currencies, or where the currency for
principal or interest payments is different from the potential investor's currency;
(iv)
understand thoroughly the terms of the Notes and be familiar with the behaviour of any relevant
financial markets; and
(v)
be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for
economic, interest rate and other factors that may affect its investment and its ability to bear the
applicable risks.
Notes can be relatively complex financial instruments. A potential investor should not invest in such Notes
unless it has the expertise (either alone or with a financial adviser) to evaluate how the Notes will perform
under changing conditions, the resulting effects on the value of the Notes and the impact this investment will
have on the potential investor's overall investment portfolio.
Limited liquidity of the Notes
Even if application is made to list Notes on a stock exchange, there can be no assurance that a secondary
market for any of the Notes will develop, or, if a secondary market does develop, that it will provide the
holders of the Notes with liquidity or that it will continue for the life of the Notes. A decrease in the liquidity
of an issue of Notes may cause, in turn, an increase in the volatility associated with the price of such issue of
Notes. Any investor in the Notes must be prepared to hold such Notes for an indefinite period of time or until
redemption of the Notes. If any person begins making a market for the Notes, it is under no obligation to
continue to do so and may stop making a market at any time. Illiquidity may have a severely adverse effect on
the market value of Notes.
Counterparty risk exposure
The ability of the relevant Issuer to make payments under the Notes is subject to general credit risks,
including credit risks of borrowers. Third parties that owe the relevant Issuer money, securities or other assets
may fail to pay or perform under their obligations. These parties include borrowers under loans granted,
trading counterparties, counterparties under swaps and credit and other derivative contracts, agents and other
financial intermediaries. These parties may default on their obligations to the relevant Issuer due to
bankruptcy, lack of liquidity, downturns in the economy or real estate values, operational failure or other
reasons.
Credit ratings may not reflect all risks
Each Issuer has a senior debt rating from Standard & Poor's, Moody's and Fitch, details of which are
contained in the relevant Registration Document.
Tranches of Notes issued under the Programme may be rated or unrated and one or more independent credit
rating agencies may assign additional credit ratings to the Notes or the Issuers. Where a Tranche of Notes is
rated, such rating will not necessarily be the same as the ratings assigned to the relevant Issuer, the
Programme or any Notes already issued.
The ratings may not reflect the potential impact of all risks related to structure, market, additional factors
discussed above and other factors that may affect the value of the Notes and the ability of an Issuer to make
payments under the Notes (including, but not limited to, market conditions and funding-related and
operational risks inherent to the business of each Issuer). A credit rating is not a recommendation to buy, sell
or hold securities. There is no assurance that a rating will remain for any given period of time or that a rating
will not be suspended, lowered or withdrawn by the relevant rating agency if, in its judgement, circumstances
in the future so warrant.
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In the event that a rating assigned to the Notes or an Issuer is subsequently suspended, lowered or withdrawn
for any reason, no person or entity is obliged to provide any additional support or credit enhancement with
respect to the Notes, the market value of the Notes is likely to be adversely affected and the ability of the
relevant Issuer to make payments under the Notes may be adversely affected.
In addition, ING Bank's assets are risk weighted. Downgrades of these assets could result in a higher risk
weighting which may result in higher capital requirements and thus a need to deleverage. This may impact net
earnings and the return on capital, and may have an adverse impact on the relevant Issuer's financial position
and ability to make payments under the Notes.
Certain considerations regarding hedging
Prospective purchasers intending to purchase Notes to hedge against the market risk associated with investing
in a currency or other basis of reference which may be specified in the applicable Final Terms, should
recognise the complexities of utilising Notes in this manner. For example, the value of the Notes may not
exactly correlate with the value of the currency or other basis which may be specified in the applicable Final
Terms. Due to fluctuating supply and demand for the Notes, there is no assurance that their value will
correlate with movements of the currency or other basis which may be specified in the applicable Final Terms.
Actions taken by the Calculation Agent may affect the value of Notes
The Calculation Agent for an issue of Notes is the agent of the relevant Issuer and not the agent of the holders
of the Notes. The Calculation Agent is not acting as a fiduciary to any holders of Notes. It is possible that the
relevant Issuer will itself be the Calculation Agent for certain issues of Notes. The Calculation Agent will
make such determinations and adjustments as it deems appropriate, in accordance with the terms and
conditions of the specific issue of Notes. In making its determinations and adjustments, the Calculation Agent
will be entitled to exercise substantial discretion and may be subject to conflicts of interest in exercising this
discretion.
Over-issuance
As part of its issuing, market-making and/or trading arrangements, the relevant Issuer may issue more Notes
than those which are to be subscribed or purchased by third party investors. The relevant Issuer (or any of its
affiliates) may hold such Notes for the purpose of meeting any investor interest in the future. Prospective
investors in the Notes should therefore not regard the issue size of any Series as indicative of the depth or
liquidity of the market for such Series, or of the demand for such Series.
The return on an investment in Notes will be affected by charges incurred by investors
An investor's total return on an investment in Notes will be affected by the level of fees charged to the
investor, including fees charged to the investor as a result of the Notes being held in a clearing system. Such
fees may include charges for opening accounts, transfers of securities, custody services and fees for payment
of principal, interest or other sums due under the terms of the Notes. Investors should carefully investigate
these fees before making their investment decision.
Tax risk
This Base Prospectus includes general summaries of certain Dutch, Belgian, Luxembourg, Swiss, United
Kingdom and United States federal income tax considerations relating to an investment in the Notes issued by
the relevant Issuer, as well as of the EU Savings Directive (see "Taxation"). Such summaries may not apply to
a particular holder of Notes or to a particular issue and do not cover all possible tax considerations. In
addition, the tax treatment may change before the maturity, exercise or termination date of Notes. Any
potential investor should consult its own independent tax adviser for more information about the tax
consequences of acquiring, owning and disposing of Notes in its particular circumstances.
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Risk relating to FATCA
In certain circumstances the Issuer and certain other non-U.S. financial institutions through which payments
on the Notes are made may be required to withhold U.S. tax at a rate of 30% pursuant to sections 1471
through 1474 of the U.S. Internal Revenue Code and the regulations and other guidance promulgated
thereunder ("FATCA") on all, or a portion of, certain payments made after 31 December 2016 in respect of (i)
Notes that are treated as debt for U.S. federal tax purposes and are issued or materially modified on or after
the date that is six months after the date on which final regulations defining "foreign passthru payments" are
issued and (ii) Notes that are treated as equity for U.S. federal tax purposes and issued at any time.
Under FATCA, in order for non-U.S. financial institutions to be able to receive payments from U.S. sources
without withholding, the non-U.S. financial institutions may be required to enter into agreements with the
U.S. Internal Revenue Service (the "IRS") to identify "financial accounts" held by U.S. persons or entities
with substantial U.S. ownership (an "IRS Agreement"). If a non-U.S. financial institution that has entered into
an IRS Agreement makes a relevant payment to an accountholder that has not provided information requested
to establish that the accountholder is exempt from reporting under these rules, or if the recipient of the
payment is a non-U.S. financial institution that has not entered into an IRS Agreement (and that is not
otherwise exempt), the payor may be required to withhold 30%.
If any Issuer or one of its respective agents (or any financial intermediaries through which an investor may
hold Notes) is required to withhold any amount from any payment on the Notes in respect of FATCA, there
will be no "gross up" (or any other additional amount) payable by way of compensation to the investor for the
withheld amount. An investor that is able to claim the benefits of an income tax treaty between its own
jurisdiction and the United States may be entitled to a refund of amounts withheld pursuant to the FATCA
rules, though the investor would have to file a U.S. tax return to claim this refund and would not be entitled to
interest from the IRS for the period prior to the refund.
Many countries have entered into intergovernmental agreements with the United States to facilitate the
implementation of FATCA ("IGAs"). In particular, The Netherlands has entered into an IGA with the United
States to help implement FATCA for certain Dutch entities. While the existence of IGAs will not eliminate the
risk of the withholding described above in all cases, these agreements are expected to reduce that risk for
financial institutions in countries that have entered into IGAs. The impact of an IGA on the Issuer and the
Issuer's reporting and withholding responsibilities under FATCA with respect to the Notes is unclear. In
particular, it is not yet certain how the United States and the jurisdictions that enter into IGAs will address
withholding on "foreign passthru payments" (which may include payments on the Notes) or if such
withholding will be required at all.
FATCA is particularly complex and its application to the Issuer and the Notes issued by it is uncertain at this
time. Each holder of Notes should consult its own tax advisor to obtain a more detailed explanation of FATCA
and to learn how it might affect such holder in its specific circumstance, in particular if it may be, or hold its
interest through an entity that is, classified as a financial institution under FATCA.
Financial Transaction Tax
In February 2013, the EU Commission adopted a proposal setting out the details of the financial transaction
tax ("FTT"), which mirrors the scope of its original proposal of September 2011, to be levied on transactions
in financial instruments by financial institutions if at least one of the parties to the transaction is located in the
FTT zone ("FTT-zone"), currently limited to 11 participating Member States (Austria, Belgium, Estonia,
France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia and Spain; the "Participating Member States"
and each a "Participating Member State").
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The proposed FTT has a very broad scope and could, if introduced in its current form, apply to certain
dealings in the Notes (including secondary market transactions) in certain circumstances. Primary market
transactions referred to in Article 5(c) of Regulation (EC) No 1287/2006 are exempt.
Under current proposals the FTT could apply in certain circumstances to persons both within and outside the
Participating Member States. Generally, it would apply to certain dealings in the Notes where at least one
party is a financial institution, and at least one party is established in a Participating Member State. A financial
institution may be, or be deemed to be, "established" in a Participating Member State in a broad range of
circumstances, including (a) by transacting with a person established in a Participating Member State or (b)
where the financial instrument which is subject to the dealings is issued in a Participating Member State.
Joint statements issued by Participating Member States indicate an intention to implement the FTT by 1
January 2016.
However, the FTT proposal remains subject to negotiation between the Participating Member States and the
scope of any such tax is uncertain. Additional EU Member States may decide to participate.
Prospective holders of the Notes are advised to seek their own professional advice in relation to the FTT.
Risk of difference in insolvency law
In the event that an Issuer becomes insolvent, insolvency proceedings will be generally governed by the
insolvency laws of that Issuer's place of incorporation. The insolvency laws of the Issuer's place of
incorporation may be different from the insolvency laws of an investor's home jurisdiction and the treatment
and ranking of holders of Notes issued by that Issuer and that Issuer's other creditors and shareholders under
the insolvency laws of that Issuer's place of incorporation may be different from the treatment and ranking of
holders of those Notes and that Issuer's other creditors and shareholders if that Issuer was subject to the
insolvency laws of the investor's home jurisdiction.
Redemption risk in respect of certain Series of Subordinated Notes
If Regulatory Call is specified in the applicable Final Terms, if the relevant Subordinated Notes are excluded
from Tier 2 capital of the Issuer for the purposes of the capital adequacy rules applicable to the Issuer at the
relevant time (other than the capital adequacy rules as in force on the issue date of the relevant Notes), the
Issuer may redeem the relevant Notes at the amount specified in the applicable Final Terms, subject to the
prior consent of the Dutch Central Bank (De Nederlandsche Bank N.V., "DNB"), provided that at the relevant
time such consent is required (but without any requirement for the consent or approval of the Subordinated
Noteholders), and upon giving not less than 15 nor more than 30 days' irrevocable notice. Also see "Risks
related to the structure of a particular issue of Notes - Notes subject to optional redemption by the Issuer"
below.
Changes in law
The conditions of the Notes and the ratings which may be assigned to them are based on the law of The
Netherlands in effect as at the date of this Base Prospectus. No assurance can be given as to the impact of any
possible judicial decision or change to Netherlands law or administrative practice after the date of this Base
Prospectus. Such changes in law may include, but are not limited to, the introduction of a variety of statutory
resolution and loss-absorption tools which may affect the rights of holders of securities issued by the Issuer,
including the Notes. Such tools may include the ability to write off sums otherwise payable on such securities
at a time when the Issuer is no longer considered viable by its regulator or upon the occurrence of another
trigger.
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Bail-in
As more fully described in the section entitled "Risk Factors" in the Registration Document which is
incorporated by reference into this Base Prospectus, including without limitation under the heading "Bank
Recovery and Resolution Regimes", Notes that may be issued under the Programme may become subject to
actions that can be taken or measures that can be applied by competent authorities if a bank or insurer
experiences serious financial problems or if the stability of the financial system is in serious and immediate
danger as a result of the situation of a Dutch financial institution.
Competent authorities may have the power to, inter alia, transfer liabilities of an entity to third parties or to a
bridge bank and expropriate securities issued by failing financial institutions. Holders of debt securities of a
bank subject to resolution could also be affected by issuer substitution or replacement, transfer of debt,
expropriation, modification of terms and/or suspension or termination of listings. Competent authorities may
also have the power to convert relevant capital instruments or eligible liabilities into shares and cancel all or a
portion of the principal amount of, or interest on, certain unsecured liabilities (which could include certain
securities that have been or will be issued by ING) of a failing financial institution and/or to convert certain
debt claims (which could include certain securities that have been or will be issued by ING) into another
security, including ordinary shares. None of these actions would be expected to constitute an event of default
under those securities entitling holders to seek repayment. Other powers of the competent authorities may be
to amend the maturity date and/or any interest payment date of debt instruments or other eligible liabilities of
the relevant financial institution and/or impose a temporary suspension of payments. None of these actions
would be expected to constitute an event of default under those debt instruments or other eligible liabilities
entitling holders to seek repayment. Each prospective investor in Notes should refer to the section headed
"Risk Factors" in the relevant Registration Document, including without limitation under the heading "Bank
Recovery and Resolution Regimes".
The risks described in this Risk Factor are particularly (though not only) relevant for Notes included in Tier 2
capital.
In addition to the risks identified in "Risk Factors -- General Risk Factors" above and the relevant
Registration Document, potential investors in Notes should consider the following:
Risks related to the structure of a particular issue of Notes
A wide range of Notes may be issued under the Programme. A number of these Notes may have features
which contain particular risks for potential investors. Set out below is a description of the most common such
features:
Notes subject to optional redemption by the Issuer
An optional redemption feature in any Notes may negatively impact their market value. During any period
when the relevant Issuer may elect to redeem Notes, the market value of those Notes generally will not rise
substantially above the price at which they can be redeemed. This also may be true prior to any redemption
period.
The relevant Issuer may be expected to redeem Notes when its cost of borrowing is lower than the interest
rate on the Notes. At those times, an investor generally would not be able to reinvest the redemption proceeds
at an effective interest rate as high as the interest rate on the Notes being redeemed and may only be able to
do so at a significantly lower rate. Potential investors should consider reinvestment risk in light of other
investments available at that time.
Fixed Rate Notes
The Issuers may issue Fixed Rate Notes. Such Notes will bear interest at a fixed Rate of Interest, which
remains constant during the life of the Notes. Any investors holding these Notes will be subject to the risk that
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any subsequent increases in market interest rates may adversely affect the real return on the Notes (and the
value of the Notes).
Floating Rate Notes
The Issuers may issue Floating Rate Notes. Such Notes will bear interest at a floating Rate of Interest, which
will be subject to market fluctuations in interest rates. In addition, the floating Rate of Interest at any time
may be lower than the rates on other Notes.
Inverse Floating Rate Notes
The Issuers may issue Inverse Floating Rate Notes. Such Notes have an interest rate equal to a fixed rate
minus a rate based upon a reference rate such as EURIBOR or LIBOR. The market values of those Notes
typically are more volatile than market values of other conventional floating rate debt securities based on the
same reference rate (and with otherwise comparable terms). Inverse Floating Rate Notes are more volatile
because an increase in the reference rate not only decreases the interest rate of the Notes, but may also reflect
an increase in prevailing interest rates, which further adversely affects the market value of these Notes.
Fixed/Floating Rate Notes
The Issuers may issue Fixed/Floating Rate Notes. Such Notes may bear interest at a rate that the relevant
Issuer may elect to convert from a fixed rate to a floating rate, or from a floating rate to a fixed rate. The
relevant Issuer's ability to convert the interest rate will affect the secondary market trading and the market
value generally of the Notes since the relevant Issuer may be expected to convert the rate when it is likely to
produce a lower overall cost of borrowing. If the relevant Issuer converts from a fixed rate to a floating rate,
the spread on the Fixed/Floating Rate Notes may be less favourable than then prevailing spreads on
comparable Floating Rate Notes tied to the same reference rate. In addition, the new floating rate at any time
may be lower than the rates on other Notes. If the relevant Issuer converts from a floating rate to a fixed rate,
the fixed rate may be lower than then prevailing market rates.
Notes issued at a substantial discount or premium
The market values of Notes issued at a substantial discount (such as Zero Coupon Notes) or premium from
their principal amount tend to fluctuate more in relation to general changes in interest rates than do prices for
more conventional interest-bearing Notes. Generally, the longer the remaining term of such Notes, the greater
the price volatility as compared to more conventional interest-bearing Notes with comparable maturities.
Issues of Subordinated Notes
The Issuers may issue Notes under the Programme which are subordinated to the extent described in
Condition 3 of the Terms and Conditions of the Notes (such Notes, "Subordinated Notes"). By virtue of such
subordination, payments to a holder of Subordinated Notes will, in the events described in the relevant
Conditions, only be made after, and any set-off by a holder of Subordinated Notes shall be excluded until, all
obligations of the relevant Issuer resulting from higher ranking claims with respect to the repayment of
borrowed money (including deposits) and other unsubordinated claims have been satisfied. A holder of
Subordinated Notes may therefore recover less than the holders of deposit liabilities or the holders of other
unsubordinated liabilities of the relevant Issuer. Furthermore, the Conditions do not limit the amount of the
liabilities ranking senior to any Subordinated Notes which may be incurred or assumed by the relevant Issuer
from time to time, whether before or after the issue date of the relevant Subordinated Notes. Although
Subordinated Notes may pay a higher rate of interest than comparable Notes which are not subordinated,
there is a real risk that an investor in Subordinated Notes will lose all or some of his investment should the
relevant Issuer become insolvent.
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In addition, the rights of holders of Subordinated Notes are limited in certain respects. In particular, early
redemption of Subordinated Notes that are included for capital adequacy purposes in Tier 2 may only be
effected after the written consent of the DNB.
Exchange rates and exchange controls
The Issuers will pay principal and interest on the Notes in the Specified Currency. This presents certain risks
relating to currency conversions if an investor's financial activities are denominated principally in a currency
or currency unit (the "Investor's Currency") other than the Specified Currency. These include the risk that
exchange rates may significantly change (including changes due to devaluation of the Specified Currency or
revaluation of the Investor's Currency) and the risk that authorities with jurisdiction over the Investor's
Currency may impose or modify exchange controls. An appreciation in the value of the Investor's Currency
relative to the Specified Currency would decrease (1) the Investor's Currency-equivalent yield on the Notes,
(2) the Investor's Currency equivalent value of the principal payable on the Notes and (3) the Investor's
Currency equivalent market value of the Notes.
Government and monetary authorities may impose (as some have done in the past) exchange controls that
could adversely affect an applicable exchange rate and/or restrict the convertibility or transferability of
currencies within and/or outside of a particular jurisdiction which in turn could adversely affect the ability of
an Issuer to make payments in respect of the Notes. As a result, investors may receive less interest or principal
than expected, or receive it later than expected or not at all.
No gross-up
All payments made by the Issuers in respect of the Notes shall be made subject to any tax, duty, withholding
or other payment which may be required to be made, paid, withheld or deducted. Holders of Notes will not be
entitled to receive grossed-up amounts to compensate for any such tax, duty, withholding or other payment
and no event of default shall occur as a result of any such withholding or deduction. As a result, investors may
receive less interest than expected and the return on their Notes could be significantly adversely affected. In
addition, each of the Issuers shall have the right to redeem Notes issued by them if, on the occasion of the
next payment due in respect of such Notes, the relevant Issuer would be required to withhold or account for
tax in respect of such Notes.
Interest rate risks
An investment in Fixed Rate Notes involves the risk that subsequent changes in market interest rates may
adversely affect the value of the Fixed Rate Notes.
Notes in New Global Note form
The New Global Note form has been introduced to allow for the possibility of notes being issued and held in a
manner which will permit them to be recognised as eligible collateral for monetary policy of the central
banking system for the euro (the "Eurosystem") and intra-day credit operations by the Eurosystem either upon
issue or at any or all times during their life. However in any particular case such recognition will depend upon
satisfaction of the Eurosystem eligibility criteria at the relevant time. Investors should make their own
assessment as to whether the Notes meet such Eurosystem eligibility criteria.
Specified Denomination of 100,000 (or its equivalent) plus higher integral multiple
In relation to any issue of Notes which have a denomination consisting of 100,000 (or its equivalent) plus a
higher integral multiple of another smaller amount, it is possible that the Notes may be traded in amounts in
excess of 100,000 (or its equivalent) that are not integral multiples of 100,000 (or its equivalent). In such a
case a holder of a Note who, as a result of trading such amounts, holds a principal amount of less than
100,000 (or its equivalent) may not receive a definitive Note in respect of such holding (should definitive
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Document Outline