Obligation Caixa Geral Depósitos 10.75% ( PTCGDJOM0022 ) en EUR

Caixa Geral Depósitos

100 % ▼

Portugal

PTCGDJOM0022 ( en EUR )

10.75% par an ( paiement annuel )

Perpétuelle

Prospectus brochure de l'obligation Caixa Geral de Depositos PTCGDJOM0022 en EUR 10.75%, échéance Perpétuelle

200 000 EUR

500 000 000 EUR

30/09/2025 ( Dans 88 jours )

La Caixa Geral de Depósitos est une banque publique portugaise, la plus grande du pays, offrant une large gamme de services financiers aux particuliers et aux entreprises.

L'Obligation émise par Caixa Geral Depósitos ( Portugal ) , en EUR, avec le code ISIN PTCGDJOM0022, paye un coupon de 10.75% par an.
Le paiement des coupons est annuel et la maturité de l'Obligation est le Perpétuelle

OFFERING CIRCULAR DATED 28 MARCH 2017

CAIXA GERAL DE DEPÓSITOS, S.A.
(incorporated with limited liability in Portugal)
500,000,000
Fixed Rate Reset Perpetual Additional Tier 1 Capital Temporary Write Down Notes
Issue Price: 100 per cent.
The 500,000,000 Fixed Rate Reset Perpetual Additional Tier 1 Capital Temporary Write Down Notes
(the "Notes") will constitute undated, unsecured and subordinated obligations of Caixa Geral de
Depósitos, S.A. (the "Issuer"), a limited liability company organised under the laws of the Republic of
Portugal ("Portugal" or the "Portuguese State"), and will be issued in accordance with the Terms and
Conditions of the Notes set out herein.
The Notes will be denominated in Euros and will bear interest on their Outstanding Principal Amount
from time to time from (and including) 30 March 2017 (the "Issue Date") to (but excluding) 30 March
2022 (the "First Call Date") at a fixed rate of 10.75 per cent. per annum and thereafter at a fixed rate of
interest which will be reset on the First Call Date and on each fifth anniversary of the First Call Date
thereafter. Interest will be payable quarterly in arrear on 30 March, 30 June, 30 September and 30
December in each year from (and including) 30 June 2017 (each an "Interest Payment Date"), provided
that any payment of interest may be cancelled, in whole or in part, in the sole and full discretion of the
Issuer, and shall be cancelled (in whole or in part) in the circumstances described in Condition 6 (Interest
Cancellation) and following the occurrence of a Trigger Event (as further described in Condition 7 (Loss
Absorption Following a Trigger Event)). The European Central Bank (the "ECB"), the Bank of Portugal,
or such other or successor authority which is responsible for prudential supervision and/or empowered by
national law to supervise the Issuer and its consolidated subsidiaries (together, the "Group") as part of the
supervisory system in operation in Portugal (the "Competent Authority") may also direct the Issuer to
exercise its discretion to cancel interest scheduled to be paid on any Interest Payment Date. Interest which
has been cancelled in accordance with the Conditions will not accumulate, and holders of the Notes
("Holders") will not at any time be entitled to any such cancelled interest.
If at any time the CET1 Ratio of the Issuer and/or the Group falls below 5.125 per cent., the
Outstanding Principal Amount of the Notes will be Written Down by the Write Down Amount, as
further provided in Condition 7 (Loss Absorption Following a Trigger Event). The Outstanding
Principal Amount may, in the sole and absolute discretion of the Issuer and subject to certain
conditions, be subsequently reinstated (in whole or in part) out of any net profits generated by the
Issuer or the Group, as further described in Condition 8 (Discretionary Reinstatement of the Notes).
The Notes will be perpetual with no fixed maturity date. The Issuer may, in its sole discretion but subject
to the approval of the Competent Authority and to compliance with the conditions set out herein and with
the Capital Regulations, elect to redeem the Notes (in whole but not in part) (i) on the First Call Date or
any Interest Payment Date thereafter or (ii) at any time following the occurrence of a Tax Event or a
Capital Event (each as defined in the Conditions); provided that, in the case of (i) only, any principal
amount by which the Notes have been Written Down pursuant to Condition 7 (Loss Absorption Following
a Trigger Event) has first been reinstated in full pursuant to Condition 8 (Discretionary Reinstatement of
the Notes). In any such case, the Notes will be redeemed at their relevant Redemption Amount.
If at any time a Tax Event or a Capital Event occurs and is continuing, the Issuer may, instead of
redeeming the Notes as aforesaid, subject to the approval of the Competent Authority and to compliance
with the Capital Regulations, elect in its sole discretion either to substitute all (but not some only) of the
Notes for, or to vary the terms of the Notes provided that they remain or become, Qualifying Additional
Tier 1 Notes.
The Notes are expected on issue to be rated B- by Fitch Ratings Ltd. ("Fitch"). Fitch is established in the
European Union and registered under Regulation (EC) No 1060/2009, as amended. A security rating is
not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or
withdrawal at any time by the assigning rating agency.

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Investing in the Notes involves significant risks. Please review carefully the section entitled "Risk
Factors" in this Offering Circular.
Application has been made to the Luxembourg Stock Exchange for Notes to be admitted to the official
list of the Luxembourg Stock Exchange (the "Official List") and admitted to trading on the Euro MTF
market of the Luxembourg Stock Exchange (the "Euro MTF Market"). The Euro MTF Market is not a
regulated market for the purposes of the Markets in Financial Instruments Directive (Directive
2004/39/EC) ("MiFID"). References in this Offering Circular to Notes being "listed" (and all related
references) shall mean that such Notes have been admitted to the Official List and admitted to trading on
the Euro MTF Market.
The Notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended
(the "Securities Act"), and, subject to certain exceptions, may not be offered or sold within the United
States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the Securities
Act ("Regulation S")). For a description of these and certain further restrictions on offers, sales and
deliveries of the Notes and on distribution of this Offering Circular and other offering materials relating
to the Notes, see "Subscription and Sale".
The Notes are not intended to be sold and should not be sold to retail clients in the European
Economic Area, as defined in the rules set out in the Product Intervention (Contingent Convertible
Instruments and Mutual Society Shares) Instrument 2015, as amended or replaced from time to
time, other than in circumstances that do not and will not give rise to a contravention of those rules
by any person. Prospective investors are referred to the section headed "Restrictions on marketing
and sales to retail investors" on page vii of this Offering Circular for further information.
The Notes will be represented in book entry form (forma escritural) in registered form (nominativas), in
denominations of 200,000, and will be integrated in and held through Interbolsa Sociedade Gestora de
Sistemas de Liquidação e de Sistemas Centralizados de Valores Mobiliários, S.A. ("Interbolsa"), as the
entity responsible for the management and operation of the Central de Valores Mobiliários, a Portuguese
Securities Centralised System (the "CVM"). The CVM currently has links in place with Euroclear Bank,
S.A./N.V. ("Euroclear") and Clearstream Banking, S.A. ("Clearstream, Luxembourg") through
securities accounts held by Euroclear and Clearstream, Luxembourg with Affiliate Members of Interbolsa
(as described herein).
Joint Lead Managers
Barclays
Caixa Banco de Investimento, S.A.
Citigroup
Deutsche Bank
J.P. Morgan

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IMPORTANT INFORMATION
The Issuer accepts responsibility for the information contained in this Offering Circular. To the best of the
knowledge and belief of the Issuer (having taken all reasonable care to ensure that such is the case) the
information contained in this Offering Circular is in accordance with the facts and does not omit anything
likely to affect the import of such information.
This Offering Circular is to be read in conjunction with all the documents which are incorporated herein
by reference (see "Documents Incorporated by Reference"). This Offering Circular shall be read and
construed on the basis that such documents are incorporated in and form part of this Offering Circular and
references herein to "this Offering Circular" shall be construed accordingly.
No person has been authorised by the Issuer or the Managers to give any information or to make any
representations other than those contained in this Offering Circular and, if given or made, such
information or representations must not be relied upon as having been authorised by or on behalf of the
Issuer or the Managers.
Neither this Offering Circular nor any other information supplied in connection with the Notes (i) is
intended to provide the basis of any credit or other evaluation or (ii) should be considered as a
recommendation or as constituting an invitation or offer by the Issuer or the Managers that any recipient
of this Offering Circular or any other information supplied in connection with the 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
Issuer. Neither this Offering Circular nor any other information supplied in connection with the Notes
constitutes an offer by or on behalf of the Issuer or any Manager to any person to subscribe for or to
purchase any Notes.
The delivery of this Offering Circular does not at any time imply that the information contained herein
concerning the Issuer or the Group is correct at any time subsequent to the date hereof or that any other
information supplied in connection with the Notes is correct as of any time subsequent to the date
indicated in the document containing the same. Neither the Issuer nor any Manager undertakes to review
the financial condition or affairs of the Issuer or the Group during the life of the Notes for the benefit of
any investor in the Notes. Prospective investors should review, inter alia, the documents deemed to be
incorporated herein by reference when deciding whether or not to purchase any Notes.
This Offering Circular does not constitute an offer to sell or the solicitation of an offer to buy 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 Offering Circular and the offer or sale of Notes may be restricted by law in certain
jurisdictions. The Issuer and the Managers do not represent that this Offering Circular 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 Issuer or the Managers which is intended to permit a public offering of the Notes or distribution of
this Offering Circular in any jurisdiction where action for that purpose is required. Accordingly, no Notes
may be offered or sold, directly or indirectly, and neither this Offering Circular 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 Offering Circular or any Notes may come must inform themselves about, and observe, any such
restrictions on the distribution of this Offering Circular and the offering and sale of Notes. In particular,
there are restrictions on the distribution of this Offering Circular and the offer or sale of Notes in the
United States (Regulation S), the United Kingdom, Portugal, Spain and Italy. For a further description of
certain restrictions on offers and sales of the Notes and on the distribution of this Offering Circular, see
"Subscription and Sale".
To the fullest extent permitted by law, none of the Managers accept any responsibility for the contents of
this Offering Circular or for any other statement made or purported to be made by the Managers or the
issue and offering of the Notes. Each Manager accordingly disclaims all and any liability, whether arising
in tort or contract or otherwise (save as referred to above), which it might otherwise have in respect of
this Offering Circular or any such statement. Neither this Offering Circular nor any other financial
statements are intended to provide the basis of any credit or other evaluation and should not be considered
as a recommendation by any of the Issuer or the Managers that any recipient of this Offering Circular or

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any other financial statements should purchase the Notes. Each potential purchaser of Notes should
determine for itself the relevance of the information contained in this Offering Circular and its purchase
of Notes should be based upon such investigation as it deems necessary. The Managers do not undertake
to review the financial condition or affairs of the Issuer during the life of the arrangements contemplated
by this Offering Circular or to advise any investor or potential investor in the Notes of any information
coming to the attention of the Managers.
RESTRICTIONS ON MARKETING AND SALES TO RETAIL INVESTORS
The Notes are complex financial instruments and are not a suitable or appropriate investment for all
investors. In some jurisdictions, regulatory authorities have adopted or published laws, regulations or
guidance with respect to the offer or sale of securities such as the Notes to retail investors.
In particular, in June 2015, the UK Financial Conduct Authority (the "FCA") published the Product
Intervention (Contingent Convertible Instruments and Mutual Society Shares) Instrument 2015, which
took effect from 1 October 2015 (the "PI Instrument").
Under the rules set out in the PI Instrument (as amended or replaced from time to time, the "PI Rules"):
(i)
certain contingent write down or convertible securities (including any beneficial interests therein),
such as securities having features substantially similar to the Notes, must not be sold to retail
clients in the European Economic Area (the "EEA"); and
(ii)
there must not be any communication or approval of an invitation or inducement to participate in,
acquire or underwrite such securities (or the beneficial interest in such securities) where that
invitation or inducement is addressed to or disseminated in such a way that it is likely to be
received by a retail client in the EEA (in each case, within the meaning of the PI Rules), other
than in accordance with the limited exemptions set out in the PI Rules.
Certain of the Managers and/or their affiliates are required to comply with the PI Rules. By purchasing, or
making or accepting an offer to purchase, any Notes (or a beneficial interest therein) from the Issuer
and/or any Manager, each prospective investor represents, warrants, agrees with, and undertakes to, the
Issuer and the Managers that:
1.
it is not a retail client in the EEA (as defined in the PI Rules);
2.
whether or not it is subject to the PI Rules, it will not:
(A)
sell or offer the Notes (or any beneficial interest therein) to retail clients in the EEA (as
defined in the PI Rules); or
(B)
communicate (including the distribution of this Offering Circular) or approve an
invitation or inducement to participate in, acquire or underwrite the Notes (or any
beneficial interests therein) where that invitation or inducement is addressed to or
disseminated in such a way that it is likely to be received by a retail client in the EEA
(in each case within the meaning of the PI Rules),
in any such case other than (i) in relation to any sale or offer to sell Notes (or any beneficial
interest therein) to a retail client in or resident in the United Kingdom (the "UK"), in
circumstances that do not and will not give rise to a contravention of the PI Rules by any person
and/or (ii) in relation to any sale or offer to sell Notes (or any beneficial interest therein) to a
retail client in any EEA member state other than the UK, where (a) it has conducted an
assessment and concluded that the relevant retail client understands the risks of an investment in
the Notes (or such beneficial interest therein) and is able to bear the potential losses involved in
an investment in the Notes (or such beneficial interest therein) and (b) it has at all times acted in
relation to such sale or offer in compliance with the Markets in Financial Instruments Directive
(2004/39/EC) ("MiFID") to the extent it applies to it or, to the extent MiFID does not apply to it,
in a manner which would be in compliance with MiFID if it were to apply to it; and
3.
it will at all times comply with all applicable laws, regulations and regulatory guidance (whether
inside or outside the EEA) relating to the promotion, offering, distribution and/or sale of the
Notes (or any beneficial interest therein), including (without limitation) any such laws,

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regulations and regulatory guidance relating to determining the appropriateness and/or suitability
of an investment in the Notes (or any beneficial interest therein) by investors in any relevant
jurisdiction.
Where acting as agent on behalf of a disclosed or undisclosed client when purchasing, or making or
accepting an offer to purchase, any Notes (or any beneficial interest therein) from the Issuer and/or any
Manager, the foregoing representations, warranties, agreements and undertakings will be given by and be
binding upon both the agent and its underlying client.
PROHIBITION OF SALES TO EEA RETAIL INVESTORS
The Notes are not intended, from 1 January 2018, to be offered, sold or otherwise made available to and,
with effect from such date, should not be offered, sold or otherwise made available to any retail investor
in the European Economic Area ("EEA"). For these purposes, a retail investor means a person who is one
(or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU ("MiFID
II") or (ii) a customer within the meaning of Directive 2002/92/EC, where that customer would not
qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II. Consequently no key
information document required by Regulation (EU) No 1286/2014 (the "PRIIPs Regulation") for
offering or selling the Notes or otherwise making them available to retail investors in the EEA has been
prepared and therefore offering or selling the Notes or otherwise making them available to any retail
investor in the EEA may be unlawful under the PRIIPS Regulation.
SUITABILITY OF INVESTMENT
The Notes are complex financial instruments that involve a high degree of risk. 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 may wish to
consider, either on its own or with the help of its financial and other professional advisers, whether it:
(i)
has 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 Offering Circular and/or any applicable supplement;
(ii)
has 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;
(iii)
understands thoroughly the terms of the Notes, such as the provisions governing Write Downs
and situations in which interest payments may be cancelled or deemed cancelled, and is familiar
with the behaviour of financial markets;
(iv)
has sufficient financial resources and liquidity to bear all of the risks of an investment in the
Notes, including where Euros (the currency for principal and interest payments) is different from
the potential investor's currency; and
(v)
is 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.
Legal investment considerations may restrict certain investments. The investment activities of certain
investors are subject to legal investment laws and regulations, or review or regulation by certain
authorities. Each potential investor should 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 collateral for various types
of borrowing; and (iii) other restrictions apply to its purchase or pledge of any Notes. Financial
institutions should consult their legal advisors or the appropriate regulators to determine the appropriate
treatment of Notes under any applicable risk-based capital or similar rules.
The Notes may be considered by eligible investors who are in a position to give the representations,
warranties, agreements and undertakings outlined in 'Restrictions on Marketing and Sales to Retail
Investors' above, and to be able to satisfy themselves that the Notes would constitute an understood,
measured, appropriate addition of risk to their overall portfolios. A potential investor should not invest in
the Notes unless it has the expertise (either alone or with the help of a financial adviser) to evaluate how

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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.
Websites
In this Offering Circular, references to websites or uniform resource locators ("URLs") are inactive
textual references and are included for information purposes only. The contents of any such website or
URL shall not form part of, or be deemed to be incorporated into, this Offering Circular.
Definitions, interpretation and rounding
In this Offering Circular, references to:

the "Group" are to the Issuer and its consolidated subsidiaries as a whole;

"", "Euro" and "EUR" are to the lawful currency of the member states of the European Union
that adopt the single currency introduced in accordance with the Treaty establishing the European
Community, as amended;

the "Competent Authority" are to the ECB, the Bank of Portugal, or such other or successor
authority which is responsible for prudential supervision and/or empowered by national law to
supervise the Issuer and the Group as part of the supervisory system in operation in Portugal; and

the "Conditions" are to the Terms and Conditions of the Notes (and reference to a numbered
Condition shall be construed accordingly).
The language of this Offering Circular is English. Certain legislative references and technical terms have
been cited in their original language in order that the correct technical meaning may be ascribed to them
under applicable law.
Certain figures included in this Offering Circular have been subject to rounding adjustments; accordingly,
figures shown for 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.
STABILISATION
In connection with the issue of the Notes, Barclays Bank PLC acting as the Stabilisation Manager
(the "Stabilisation Manager") or any person acting on its behalf 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, stabilisation may not necessarily occur. Any stabilisation
action may begin on or after the date on which adequate public disclosure of the terms of the offer
of the Notes is made and, if begun, may cease at any time, but it must end no later than the earlier
of 30 days after the issue date of the Notes and 60 days after the date of the allotment of the Notes.
Any stabilisation action or over-allotment must be conducted by the Stabilisation Manager (or
persons acting on its behalf) in accordance with all applicable laws and rules.
FORWARD-LOOKING STATEMENTS
This Offering Circular includes forward-looking statements. All statements other than statements of
historical facts included in this Offering Circular, including, without limitation, those regarding the
Issuer's financial position, business strategy, plans and objectives of management for future operations
(including development plans and objectives relating to the Issuer's products), are forward-looking
statements. Such forward-looking statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievements of the Issuer, or industry results,
to be materially different from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such forward-looking statements are based on numerous assumptions
regarding the Issuer's present and future business strategies and the environment in which the Issuer will
operate in the future. The important factors that could cause the Issuer's actual results, performance or
achievements to differ materially from those in the forward-looking statements include, among others, the
economic situation in Portugal and in the other jurisdictions in which the Issuer and the Group operate.
These forward-looking statements speak only as at the date of this Offering Circular. The Issuer expressly
disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-

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looking statement contained herein to reflect any change in the Issuer's expectations with regard thereto
or any change in events, conditions or circumstances on which any such statement is based.

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CONTENTS

Page
RISK FACTORS .......................................................................................................................................... 1
DOCUMENTS INCORPORATED BY REFERENCE ............................................................................. 39
OVERVIEW OF THE NOTES .................................................................................................................. 41
TERMS AND CONDITIONS OF THE NOTES ....................................................................................... 50
NOTES HELD THROUGH INTERBOLSA ............................................................................................. 72
USE OF PROCEEDS ................................................................................................................................. 74
DESCRIPTION OF THE ISSUER............................................................................................................. 75
TAXATION ............................................................................................................................................. 138
SUBSCRIPTION AND SALE ................................................................................................................. 145
GENERAL INFORMATION .................................................................................................................. 148

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RISK FACTORS
The Issuer believes that the following factors may affect its ability to fulfil its obligations under the Notes.
All of these factors are contingencies which may or may not occur and the Issuer is not in a position to
express a view on the likelihood of any such contingency occurring.
Factors which the Issuer believes may be material for the purpose of assessing the market risks
associated with the Notes are also described below.
The Issuer believes that the factors described below represent the principal risks inherent in investing in
Notes, but the Issuer may be unable to pay interest, principal or other amounts on or in connection with
the Notes for other reasons and the Issuer does not represent that the statements below regarding the
risks of holding the Notes are exhaustive. Prospective investors should also read the detailed information
set out elsewhere in this Offering Circular or incorporated by reference herein and reach their own views
prior to making any investment decision.
Capitalised terms used but not otherwise defined in this risk factor section shall have the meanings given
to them under "Terms and Conditions of the Notes".
Risk Factors Relating to the Group's Business
The following section of the Offering Circular contains an overview of the Strategic Plan (as defined
below). There can be no assurances that the Issuer will be able to fully implement the Strategic Plan or as
to the consequences of missing the targets set out in the Strategic Plan. The factors that may impact the
ability of the Issuer to attain the targets in the Strategic Plan are not all within the control of the Issuer.
The targets described below have been agreed as part of the agreement reached with DG Comp (as
defined below). They have not been prepared for the purpose of the offering of the Notes and are not, and
should not be regarded by potential investors as, a forecast of future performance by the Issuer.
Risks relating to State ownership and State Aid
2012 Recapitalisation Plan
In June 2012, the Portuguese State, as the Issuer's sole shareholder, approved a recapitalisation plan in the
amount of 1,650 million, which included:

a capital increase by its shareholder in the amount of 750 million; and

an issuance of hybrid financial instruments, eligible as core tier 1 capital amounting to 900
million, fully subscribed by the Portuguese State.
The capital injection by the Portuguese State was considered State Aid and subject to an individual State
Aid decision by the European Commission (Decision SA.35062 (2012/N)).
2017 Recapitalisation Plan
The Issuer has posted losses after 2012, mostly due to subdued growth in the Portuguese economy that
affected credit concession by banks, but also due to the impact of provisions and impairments related to
non-performing loans.
In order to be able to continue its activities and also to comply with increasing capital requirements, the
Portuguese State, being the Issuer's sole shareholder, and the European Commission's Directorate General
for Competition ("DG Comp") approved a further recapitalisation plan (the "2017 Recapitalisation
Plan"). The plan (which was specifically designed so as not to trigger State Aid rules) had four main
components of which the final requirements are as follows:

a capital increase in-kind of an estimated amount of 500 million by delivery to the Issuer of the
49 per cent. stake held by Parpública (a Portuguese State holding company) in Parcaixa, SGPS,
S.A.;

a capital increase in-kind of an estimated amount of 900 million plus accrued unpaid interest by
delivery to the Issuer of the hybrid financial instruments issued in 2012 (and referred to above);

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a capital increase in cash by the Portuguese State (the final figure of which has been agreed at
2,500 million);

the issue of subordinated debt instruments, the final figure of which has been agreed at a
principal amount of 930 million (500 million being the Notes which are the subject of this
Offering Circular) to investors not related to the Portuguese State or Portuguese State entities
with the issue of the Notes to occur at the same time as the capital increase in cash by the
Portuguese State.
The first two components were completed in January 2012 (see "Risks relating to State ownership and
State Aid - Completion of First Part of the 2017 Recapitalisation Plan").
In order not to trigger State Aid rules, the 2017 Recapitalisation Plan has two conditions which have to be
met: (i) that the Issuer is able to sell the issue of subordinated debt instruments to private investors, and
(ii) that the Issuer implements a strategic plan (the "Strategic Plan") between 2017 and 2020, designed to
improve the Issuer's profitability and sustainability and to create value for the shareholder on terms
similar to those that which would be demanded by private investors in current market circumstances.
The 2017 Recapitalisation Plan and the Strategic Plan were approved by both the European Commission
and the Portuguese State without triggering State Aid rules, as confirmed by a public communication
issued on 10 March 2017 by the European Commission (the "2017 Press Release"). Accordingly no State
Aid or other similar restrictions apply to the Issuer or the Group. Furthermore, the European Commission
stated that it has accepted the early termination of the Issuer's commitment not to pay discretionary
coupons on subordinated debt.
Completion of First Part of the 2017 Recapitalisation Plan
The first part of the 2017 Recapitalisation Plan was concluded on 4 January 2017, with an increase in the
Issuer's share capital from 5,900,000,000 to 7,344,143,735, through the issuance of 288,828,747 new
ordinary shares with a nominal value of 5.00, each fully subscribed for and paid up by the Portuguese
State, as follows:

945,148,185 through the transfer of contingent convertible bonds subscribed for by the
Portuguese State in 2012, with a nominal value of 900,000,000 plus accrued and unpaid interest
of 45,148,185.

498,995,550, (corresponding to the book value of the Portuguese State's equity stake in Parcaixa,
SGPS, S.A.), through the transfer in-kind of 490,000,000 equity shares.
In addition, the following steps were taken:

The use of the free reserves and legal reserve amounting to a total of 1,412,460,251 to cover the
same amount of retained losses carried forward from past years.

A reduction of the Issuer's share capital by an amount of 6,000,000,000, to 1,344,143,735,
through the extinguishing of 1,200,000,000 shares with a nominal value of 5.00 each, to cover
the retained losses of 1,404,506,311 and to set up a free reserve for the amount of
4,595,493,689.
In addition, on 31 January 2017, eight members of the Board of Directors of the Issuer were elected for a
new period of office of four years, one as a non-executive member and seven as executive members. It is
intended that further individuals will be appointed to the Board of Directors.
Second Part of the 2017 Recapitalisation Plan
The second part of the 2017 Recapitalisation Plan, which comprises (i) the issue of subordinated debt
instruments 500 million of which being the Notes which are the subject of this Offering Circular (ii) the
2,500 million cash injection by the Portuguese State, are expected to take place before the end of the
first quarter of 2017. The remaining 430 million of subordinated debt instruments are due to be issued
within 18 months following the issue of the Notes which are the subject of this Offering Circular.

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