Obligation CaixaBank, S.A. 1.125% ( XS1679158094 ) en EUR

CaixaBank, S.A.

100 % ▼

Espagne

XS1679158094 ( en EUR )

1.125% par an ( paiement annuel )

11/01/2023 - Obligation échue

Prospectus brochure de l'obligation Caixabank S.A XS1679158094 en EUR 1.125%, échue

100 000 EUR

1 250 000 000 EUR

CaixaBank S.A. est une banque espagnole multinationale, issue de la fusion de Caixa d'Estalvis i Pensions de Barcelona et Bankia, offrant une large gamme de services financiers aux particuliers et aux entreprises.

L'Obligation émise par CaixaBank, S.A. ( Espagne ) , en EUR, avec le code ISIN XS1679158094, paye un coupon de 1.125% par an.
Le paiement des coupons est annuel et la maturité de l'Obligation est le 11/01/2023

DRAWDOWN PROSPECTUS

CAIXABANK, S.A.
(incorporated as a limited liability company (sociedad anónima) in Spain)

Issue of 1,250,000,000 1.125 per cent. Senior Non-Preferred Notes due 12 January 2023
(the "Notes")
Series No: 5
Tranche No: 1
Issue Price: 99.852 per cent.
Issued under the Euro 10,000,000,000 Euro Medium Term Note Programme
(the "Programme")
This drawdown prospectus (the "Drawdown Prospectus") comprises (i) this document and (ii) the documents and
information specified in the section headed "Documents Incorporated by Reference" below.
This Drawdown Prospectus has been prepared in connection with the issue of 1,250,000,000 aggregate principal amount
of 1.125 per cent. senior non-preferred notes due 12 January 2023 (the "Notes") by Caixabank, S.A. (the "Issuer" or
"CaixaBank" who with its subsidiaries composes the "Group").
The Notes are direct, unconditional, unsubordinated and unsecured obligations of the Issuer. The Notes constitute non-
preferred ordinary claims (créditos ordinarios no preferentes) under Additional Provision 14.2º of Law 11/2015 (as
defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)"). It is expressly stated for the purposes
of Additional Provision 14.2º of Law 11/2015 that upon the insolvency of the Issuer, the Notes will rank below any other
ordinary claims (créditos ordinarios) of the Issuer and accordingly, claims in respect of the Notes shall be paid after
payment of any such other ordinary claims (créditos ordinarios) of the Issuer. Therefore, in accordance with the
Insolvency Law (as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)") and Additional
Provision 14.2º of Law 11/2015 (but subject to any other ranking that may apply as a result of any other mandatory
provision of law (or otherwise)), upon the insolvency of the Issuer the payment obligations of the Issuer under the Notes
in respect of principal (unless they qualify as subordinated claims pursuant to Articles 92.1º or 92.4º to 92.7º of the
Insolvency Law) will rank (a) senior to any claims against the Issuer qualifying as subordinated claims (créditos
subordinados) under Article 92 of the Insolvency Law (or equivalent legal provision which replaces it in the future);
(b) pari passu among themselves and with any claims under any other Senior Non-Preferred Obligations (as defined in
the "Terms and Conditions of the Notes -- Condition 18 (Definitions)"); and (c) junior to any claims under any Senior
Preferred Obligations (as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)").
The Notes will be issued on 12 September 2017 (the "Issue Date") and will bear interest at a rate of 1.125 per cent. per
annum from (and including) the Issue Date, payable annually in arrear on 12 January of each year, with the first Interest
Payment Date falling on 12 January 2018 in respect of the period from (and including) the Issue Date to (but excluding)
such interest payment date (short first coupon), as further described in Condition 3 (Interest).
The Notes will be in bearer form and in the denomination of 100,000 each. The Notes will initially be in the form of a
temporary global note (the "Temporary Global Note"), without interest coupons, which will be deposited on or
around 12 September 2017 (the "Closing Date") with a common safekeeper for Euroclear Bank S.A./N.V. ("Euroclear")
and Clearstream Banking, S.A. ("Clearstream, Luxembourg"). The Temporary Global Note will be exchangeable, in
whole or in part, for interests in a permanent global note (the "Permanent Global Note"), without interest coupons, not
earlier than 40 days after the Closing Date upon certification as to non-U.S. beneficial ownership. Interest payments in
respect of the Notes cannot be collected without such certification of non-U.S. beneficial ownership. The Permanent

- 1-

Global Note will be exchangeable in certain limited circumstances in whole, but not in part, for Notes in definitive form
in the denomination of 100,000 each and with interest coupons attached.
Unless previously redeemed or purchased and cancelled, the Notes will be redeemed at par on 12 January 2023 (the
"Maturity Date"). The Issuer may, at its option (subject to the prior permission of the Regulator and/or the Relevant
Spanish Resolution Authority, if required), redeem all, but not some only, of the Notes at their outstanding principal
amount plus accrued interest (if any) thereon upon the occurrence of a Tax Event or a MREL Disqualification Event (each
as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)"). In the event that a Tax Event, a
MREL Disqualification Event or an Alignment Event (each as defined in the "Terms and Conditions of the Notes --
Condition 18 (Definitions)") occurs and is continuing, the Issuer may (subject to the prior permission of the Regulator
and/or the Relevant Spanish Resolution Authority, if required) also substitute all (but not some only) of the Notes or vary
the terms of all (but not some only) of the Notes, without any requirement for the consent or approval of the Noteholders,
so that they become or remain Qualifying Notes (as defined in the "Terms and Conditions of the Notes -- Condition 18
(Definitions)").
This document has been approved as a prospectus by the Central Bank of Ireland (the "CBI") in its capacity as competent
authority under Directive 2003/71/EC, as amended, including by Directive 2010/73/EU (the "Prospectus Directive").
The CBI only approves this Drawdown Prospectus as meeting the requirements imposed under Irish and EU law pursuant
to the Prospectus Directive. Application has been made to the Irish Stock Exchange for Notes to be admitted to its official
list (the "Official List") and trading on the regulated market of the Irish Stock Exchange plc (the "Main Securities
Market"). References in the Drawdown Prospectus to the Notes being "listed" (and all related references) shall mean
that such Notes have been admitted to listing on the Official List of the Irish Stock Exchange plc and admitted to trading
on the Main Securities Market. The Main Securities Market of the Irish Stock Exchange is a regulated market for the
purposes of Directive 2004/39/EC, as amended.
The Notes have not been and will not be registered under the United States Securities Act of 1933, as amended (the
"Securities Act") or the securities laws of any state in the United States and are subject to United States tax law
requirements. The Notes will be offered only outside the United States to U.S. persons (as defined in Regulation S under
the Securities Act ("Regulation S")), and may not be offered, sold or delivered within the United States or to, or for the
account or benefit of, U.S. persons (as defined in Regulation S) except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
The Notes are expected to be rated BBB-, BBB, Ba2 and BBBH, respectively by Standard & Poor's Credit Market
Services Europe Limited, Fitch Ratings España, S.A.U., Moody's Investors Service España, S.A. and DBRS Ratings
Limited, each of which are established in the European Union and registered under Regulation (EC) No. 1060/2009, as
amended (the "CRA Regulation"). 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.
Investing in the Notes involves certain risks. The principal risk factors that may affect the ability of the Issuer to
fulfil its obligations under the Notes are discussed under "Risk Factors" below.

Lead Managers
CaixaBank
Citigroup
HSBC
Nomura
Société Générale
Corporate &
Investment
Banking

The date of this Drawdown Prospectus is 5 September 2017.

- 2-

IMPORTANT INFORMATION

This Drawdown Prospectus comprises a prospectus for the purposes of the Prospectus Directive and any
relevant implementing measure in a relevant Member State of the European Economic Area.
The Issuer accepts responsibility for the information contained in this Drawdown Prospectus. To the best of
the knowledge of the Issuer (having taken all reasonable care to ensure that such is the case) the information
contained in this Drawdown Prospectus is in accordance with the facts and does not omit anything likely to
affect the import of such information.
This Drawdown Prospectus must be read and construed with any information incorporated by reference herein
(see "Documents Incorporated by Reference" below).
The Lead Managers 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 Lead Managers as to the accuracy or completeness of the information contained or
incorporated in this Drawdown Prospectus. No Lead Manager accepts any liability in relation to the
information contained or incorporated by reference in this Drawdown Prospectus.
No person is or has been authorised by the Issuer to give any information or to make any representation not
contained in or not consistent with this Drawdown Prospectus or any other information supplied in connection
with the Notes and, if given or made, such information or representation must not be relied upon as having
been authorised by the Issuer or any of the Lead Managers.
Neither this Drawdown Prospectus nor any other information supplied in connection with the Notes (a) is
intended to provide the basis of any credit or other evaluation; or (b) should be considered as a recommendation
by the Issuer or any of the Lead Managers that any recipient of this Drawdown Prospectus 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 Drawdown Prospectus nor any other
information supplied in connection with the Notes constitutes an offer or invitation by or on behalf of the
Issuer or any of the Lead Managers to any person to subscribe for or to purchase any Notes.
Neither the delivery of this Drawdown Prospectus nor the offering, sale or delivery of any Notes shall in any
circumstances imply that the information contained herein concerning the Issuer 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. The Lead Managers
expressly do not undertake to advise any investor in the Notes of any information coming to their attention.
IMPORTANT INFORMATION RELATING TO THE USE OF THIS DRAWDOWN PROSPECTUS
AND OFFERS OF NOTES GENERALLY
This Drawdown 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 Drawdown Prospectus and the offer or sale of Notes may be restricted by law in certain
jurisdictions. The Issuer and the Lead Managers do not represent that this Drawdown 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 Issuer or the Lead Managers which is intended to permit a public offering of any Notes or distribution of
this Drawdown 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 Drawdown 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
Drawdown Prospectus or any Notes may come must inform themselves about, and observe, any such
restrictions on the distribution of this Drawdown Prospectus and the offering and sale of Notes. In particular,

- 3-

there are restrictions on the distribution of this Drawdown Prospectus and the offer or sale of Notes in the
United States, the United Kingdom, Spain, Republic of Italy, France and Japan, see "Subscription and Sale".
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
Drawdown Prospectus 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)
has 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)
understands thoroughly the terms of the Notes and is familiar with the behaviour of any relevant
indices and financial markets; and
(v)
is able to evaluate 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 (1) Notes are
legal investments for it, (2) Notes can be used as collateral for various types of borrowing and (3) 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.
The Notes have not been and will not be registered under the Securities Act or the securities laws of any state
in the United States and are subject to U.S. tax law requirements. The TEFRA D rules apply. 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 (as defined in Regulation S) (see "Subscription and Sale").
PRESENTATION OF INFORMATION
In this Drawdown Prospectus, all references to "euro" and "" refer to the currency introduced at the start of
the third stage of European economic and monetary union pursuant to the Treaty on the Functioning of the
European Union, as amended.
The language of the prospectus 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.
STABILISATION
In connection with the issue of the Notes, Nomura International plc (the "Stabilisation Manager") (or persons
acting on behalf of the Stabilisation Manager) 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 be ended at any
time, but it must end no later than the earlier of 30 days after the Issue Date and 60 days after the date of the
allotment of the Notes. Any stabilisation action or over-allotment must be conducted by the Stabilisation

- 4-

Manager (or persons acting on behalf of the Stabilisation Manager) in accordance with all applicable laws and
rules.

- 5-

CONTENTS
Section
Page
1.
Risk Factors .......................................................................................................................................... 7
2.
Documents Incorporated by Reference .............................................................................................. 12
3.
Form of Notes ..................................................................................................................................... 14
4.
Terms and Conditions of the Notes .................................................................................................... 17
5.
Subscription and Sale ......................................................................................................................... 34
6.
General Information ........................................................................................................................... 35

- 6-

RISK FACTORS

Prior to making an investment decision, prospective investors should consider carefully all of the information
set out and incorporated by reference in this Drawdown Prospectus, including in particular the risk factors
set forth below.
This section is not intended to be exhaustive and, in particular, the following does not describe all the risks of
an investment in the Notes. Prospective investors should make their own independent evaluations of all risk
factors, read the detailed information set out elsewhere and incorporated by reference in this Drawdown
Prospectus, and consult their own financial and legal advisers about risks associated with investment in the
Notes and the suitability of investing in the Notes in light of their particular circumstances.
Risks Relating to the Issuer and the Group
The risks factors relating to the Issuer and the Group are set out under the heading "Risk Factors - Factors that
may affect the Issuer's ability to fulfil its obligations under the Notes issued under the Programme" on
pages 14-38 in the Core Base Prospectus (as defined below) as supplemented, and shall be deemed to be
incorporated into and form part of this Drawdown Prospectus, as set out below.
Risks relating to the Notes
Certain risk factors relating to the Notes are discussed under "Risk Factors - Factors Which Are Material for
the Purpose of Assessing the Market Risks Associated With Notes Issued under the Programme Risks related
to the structure of a particular issue of Notes - If the Issuer has the right to redeem any Notes at its option, this
may limit the market value of the Notes concerned and an investor may not be able to reinvest the redemption
proceeds in a manner which achieves a similar effective return" on page 38-39 of the Core Base Prospectus
and under "Risk Factors - Factors which are Material for the Purpose of Assessing the Market Risks Associated
with Notes Issued under the Programme - Risks related to Early Intervention and Resolution" on page 42-45
of the Core Base Prospectus and under "Risk Factors - Factors which are Material for the Purpose of Assessing
the Market Risks Associated with Notes Issued under the Programme - Risks Relating to the Insolvency Law"
on page 47-48 of the Core Base Prospectus and under "Risk Factors Factors which are Material for the
Purpose of Assessing the Market Risks Associated with Notes Issued under the Programme - Risks Related to
the Notes generally" on pages 48-51 of the Core Base Prospectus and under Risk Factors Factors which are
Material for the Purpose of Assessing the Market Risks Associated with Notes Issued under the Programme -
Risks Related to the market generally" on pages 52-53 of the Core Base Prospectus and shall be deemed to be
incorporated into and form part of this Drawdown Prospectus as set out below.
Prospective investors should also consider the following risk factors prior to making any investment decision:
Claims of Holders under the Notes are effectively junior to those of certain other creditors
The payment obligations of the Issuer under the Notes constitute direct, unconditional, unsubordinated and
unsecured obligations of the Issuer. The Notes constitute non-preferred ordinary claims (créditos ordinarios
no preferentes) under Additional Provision 14.2º of Law 11/2015 (as defined in the "Terms and Conditions of
the Notes -- Condition 18 (Definitions)").
Therefore, in accordance with the Insolvency Law and Additional Provision 14.2º of Law 11/2015 (but subject
to any other ranking that may apply as a result of any other mandatory provision of law (or otherwise)), upon
the insolvency of the Issuer the payment obligations of the Issuer under the Notes in respect of principal (unless
they qualify as subordinated claims pursuant to Articles 92.1º or 92.4º to 92.7º of the Insolvency Law) will
rank:
a)
senior to any claims against the Issuer qualifying as subordinated claims (créditos subordinados)
under Article 92 of the Insolvency Law (or equivalent legal provision which replaces it in the future);
b)
pari passu among themselves and with any claims under any other Senior Non-Preferred Obligations
(as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)"); and

- 7-

c)
junior to any claims under any Senior Preferred Obligations (as defined in the "Terms and Conditions
of the Notes -- Condition 18 (Definitions)").
Therefore, the Notes will be effectively subordinated to claims against the insolvency estate (créditos contra
la masa), claims with privilege (créditos pivilegiados) and any other ordinary claims (créditos ordinarios)
against the Issuer, including without limitation, the Issuer's Senior Preferred Obligations. Senior Preferred
Obligations of the Issuer would include, among other obligations, its deposit obligations (other than the
deposits obligations qualifying as claims with privilege (créditos privilegiados) under Additional
Provision 14.1º of Law 11/2015), its obligations in respect of derivatives and its unsubordinated and unsecured
debt securities other than Senior Non-Preferred Obligations.
The Notes are also structurally subordinated to all indebtedness of subsidiaries of the Issuer insofar as any
right of the Issuer to receive any assets of such companies upon their winding-up will be effectively
subordinated to the claims of the creditors of those companies in the winding-up.
Moreover, the BRRD (as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)"),
Law 11/2015, RD 1012/2015 and the SRM Regulation contemplate that Notes may be subject to the exercise
of certain Bail-in Powers (as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)")
by the Relevant Spanish Resolution Authority. Condition 16 (Bail-in) provides for the contractual recognition
of Noteholders of such Bail-in Power (see "Risk Factors Rises Related to Early Intervention and Resolution
 The Notes may be subject to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution
Authority. Other powers contained in Law 11/2015 could materially affect the rights of the Noteholders under,
and the value of, any Notes" of the Core Base Prospectus).
The qualification of the Notes as MREL-Eligible Senior Non-Preferred Instruments is subject to
uncertainty
The Notes are intended to be MREL-Eligible Senior Non-Preferred Instruments (as defined in the "Terms and
Conditions of the Notes -- Condition 18 (Definitions)") under the Applicable MREL Regulations (as defined
in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)"). However, there is uncertainty
regarding the final substance of the Applicable MREL Regulations and how those regulations, once enacted,
are to be interpreted and applied and the Issuer cannot provide any assurance that the Notes will be (or
thereafter remain) MREL-Eligible Senior Non-Preferred Instruments.
The European Commission has recently proposed directives and regulations (such as the Draft EC Proposals
(as defined in the "Terms and Conditions of the Notes -- Condition 18 (Definitions)") intended to modify the
requirements for MREL eligibility. While the Terms and Conditions of the Notes may be consistent with the
Draft EC Proposals, these Proposals have not yet been interpreted and, when finally adopted, the final
Applicable MREL Regulations may be different from those set forth in these proposals or, if finally adopted
in a form consistent with the proposals, may subsequently be amended, supplemented or replaced.
Because of the uncertainty surrounding the substance of the final Applicable MREL Regulations and their
interpretation and application and any potential change to them, the Issuer cannot provide any assurance that
the Notes will ultimately be (or thereafter remain) MREL-Eligible Senior Non-Preferred Instruments. If there
is a change in, or amendment to, the Applicable MREL Regulations, or any change in the application or
interpretation thereof, as a result of which all or part of the outstanding principal amount of the Notes will not
at any time prior to the Maturity Date fully qualify as MREL-Eligible Senior Non-Preferred Instruments of the
Issuer and/or the Group, then a MREL Disqualification Event (as defined in the "Terms and Conditions of the
Notes -- Condition 18 (Definitions)") may occur, with the consequences indicated below. See "--The Notes
may be redeemed prior to maturity upon the occurrence of a Tax Event or a MREL Disqualification Event ".
The Notes may be redeemed prior to maturity upon the occurrence of a Tax Event or a MREL
Disqualification Event
The Issuer may, at its option, redeem all, but not some only, of the Notes at any time at their outstanding
principal amount, together with accrued but unpaid interest up to (but excluding) the date of redemption, upon

- 8-

or following the occurrence of a Tax Event (as defined in the "Terms and Conditions of the Notes --
Condition 18 (Definitions)") or a MREL Disqualification Event.
The early redemption of the Notes that qualify as eligible liabilities may be made if so permitted by Applicable
MREL Regulations then in force and subject to the prior permission of the Regulator and/or the Relevant
Resolution Authority (if such permission is required). The Draft EC Proposals provides that the redemption of
eligible liabilities prior to the date of their contractual maturity is subject to the prior permission of the
competent authority. According to these Proposals, such permission will be given only if either of the following
conditions are met:
(i)
on or before such redemption, the institution replaces the instruments with own funds or eligible
liabilities instruments of equal or higher quality at terms that are sustainable for the income capacity
of the Issuer; or
(ii)
the institution has demonstrated to the satisfaction of the competent authority that the own funds and
eligible liabilities of the institution would, following such redemption, exceed the requirements laid
down in the CRR (as defined in the "Terms and Conditions of the Notes -- Condition 18
(Definitions)"), the CRD IV (as defined in the "Terms and Conditions of the Notes -- Condition 18
(Definitions)") and the BRRD by a margin that the competent authority considers necessary.
It is not possible to predict whether or not any change in the laws or regulations of Spain, Applicable MREL
Regulations or the application or official interpretation thereof, will occur and so lead to the circumstances in
which the Issuer is able to elect to redeem the Notes, and if so whether or not the Issuer will elect to exercise
such option to redeem the Notes or if any prior permission of the competent authority, if required, will be
given. The Issuer may be expected to redeem the 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.
Early redemption features are also likely to limit the market value of the Notes. During any period when the
Issuer can redeem the 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 if the market
believes that the Notes may become eligible for redemption in the near term.
The Notes may be subject to substitution and/or variation without Noteholder consent
Subject as provided in the Terms and Conditions of the Notes, in particular to the provisions of Condition 6
(Substitution and Variation), if a Tax Event, a MREL Disqualification Event or an Alignment Event occurs,
the Issuer may, at its option, and without the consent or approval of the Noteholders, elect either (i) to substitute
all (but not some only) of the Notes or (ii) to vary the terms of all (but not some only) of the Notes, in each
case so that they are substituted for, or varied to, become or remain Qualifying Notes. While Qualifying Notes
generally must contain terms that are materially no less favourable to Noteholders as the original terms of the
Notes, there can be no assurance that the terms of any Qualifying Notes will be viewed by the market as equally
or more favourable, or that the Qualifying Notes will trade at prices that are equal to or higher than the prices
at which the Notes would have traded on the basis of their original terms.
Further, prior to the making of any such substitution or variation, the Issuer, shall not be obliged to have regard
to the tax position of individual Noteholders or to the tax consequences of any such substitution or variation
for individual Noteholders. No Noteholder shall be entitled to claim, whether from the Agent, the Issuer, or
any other person, any indemnification or payment in respect of any tax consequence of any such substitution
or variation upon individual holders of Notes.
The Notes provide for limited events of default
The Terms and Conditions of the Notes do not provide for any events of default, except if an order is made by
any competent court commencing insolvency proceedings against the Issuer or for its winding up or

- 9-

dissolution. Accordingly, in the event that any payment on the Notes is not made when due, each Noteholder
will have a claim only for amounts then due and payable on their Notes but will have no right to accelerate
such Notes unless proceedings for the winding up or dissolution of the Issuer have been instigated (other than
in the context of a Permitted Reorganisation (as defined in the "Terms and Conditions of the Notes --
Condition 18 (Definitions)").
Change of law
The Terms and Conditions of the Notes are subject to English law, except for Condition 2 (Status of the Notes)
which is subject to Spanish law, as in effect as at the date of this Drawdown Prospectus. Changes in European,
English or Spanish laws or their official interpretation by regulatory authorities after the date hereof may affect
the rights and effective remedies of Noteholders as well as the market value of the Notes. Such changes in law
or official interpretation of such laws may include changes in statutory, tax and regulatory regimes during the
life of the Notes, which may have an adverse effect on an investment in the Notes. No assurance can be given
as to the impact of any possible judicial decision or change to such laws or official interpretation of such laws
or administrative practices after the date of this Drawdown Prospectus.
In particular, on 23 November 2016, the European Commission published the Draft EC Proposals which,
among others, aim at implementing the MREL Requirements. Among others, the European Commission
proposes to amend Article 108 of the BRRD in order to facilitate the creation of a new class of "non-preferred"
senior debt which will be eligible to count as MREL. Royal Decree-Law 11/2017, of 23 June, approving urgent
measures on financial matter (Real Decreto-Ley 11/2017, de 23 de junio, de medidas urgentes en materia
financiera) ("RDL 11/2017"), entered into force on 25 June 2017 and amended Additional Provision 14.2º of
Law 11/2015 to include non-preferred ordinary claims (créditos ordinarios no preferentes) in Spain. However,
it cannot be ruled out that the current legal regime of this new category of claims will be amended or derogated
including as a result of the implementation of the proposal for an European Directive amending Article 108 of
BRRD.
Furthermore, any change in the laws or regulations of Spain, Applicable MREL Regulations or the application
or interpretation thereof may in certain circumstances result in the Issuer having the option to redeem,
substitute or vary the terms of the Notes (see "-- The Notes may be redeemed prior to maturity upon the
occurrence of a Tax Event or a MREL Disqualification Event " and "--The Notes may be subject to substitution
and/or variation without Noteholder consent"), each of which actions could materially and adversely affect
investors and frustrate investment strategies and goals.
Such legislative and regulatory uncertainty could affect an investor's ability to value the Notes accurately and
therefore affect the market price of the Notes given the extent and impact on the Notes of one or more
regulatory or legislative changes.
Senior non-preferred securities are new types of instruments for which there is very limited trading history
On 25 June 2017, RDL 11/2017 entered into force. RDL 11/2017 amended Additional Provision 14.2º of
Law 11/2015, which provides for the legal recognition of non-preferred ordinary claims (créditos ordinarios
no preferentes) in Spain. Although certain Spanish financial institutions have issued senior non-preferred
securities or securities with similar features in the past, there is little trading history for securities of financial
institutions with this ranking. Markets participants, including credit rating agencies, are in the initial stages of
evaluating the risks associated with senior non-preferred securities. The credit ratings assigned to senior non-
preferred securities such as the Notes may change as the rating agencies refine their approaches, and the value
of such securities may be particularly volatile as the market becomes more familiar with them. It is possible
that, over time, the credit ratings and value of senior non-preferred securities such as the Notes will be lower
than those expected by investors at the time of issuance of the Notes. If so, Noteholders may incur losses in
respect of their investments in the Notes.

- 10-

Document Outline

#7">Risks relating to the Notes
#17">1. Form, Denomination and Title
#18">2. STATUS OF THE NOTES
- #18">(a) senior to any claims against the Issuer qualifying as subordinated claims (créditos subordinados) under Article 92 of the Insolvency Law (or equivalent legal provision which replaces it in the future);
- #18">(b) pari passu among themselves and with any claims under any other Senior Non-Preferred Obligations; and
- #18">(c) junior to any claims under any Senior Preferred Obligations.
#18">3. Interest
- #18">The Notes bear interest from 12 September 2017 (the "Issue Date") at the rate of 1.125 per cent. per annum, (the "Rate of Interest") payable in arrear on 12 January in each year (each, an "Interest Payment Date"), with the first Interest Payment Date ...
- #19">Each Note will cease to bear interest from the due date for redemption unless, upon due presentation, payment of principal is improperly withheld or refused, in which case it will continue to bear interest at such rate (both before and after judgment)...
- #19">The amount of interest payable on the first Interest Payment Date shall be 376.02 in respect of each Note of 100,000 denomination. The amount of interest payable on each subsequent Interest Payment Date shall be 1,125 in respect of each Note of 10...
#19">4. Payments
- #19">4.1 Method of payment
- #19">4.2 Presentation of definitive Notes and Coupons
- #19">4.3 Payments in respect of Global Notes
- #20">4.4 General provisions applicable to payments
- #20">4.5 Payment Day
  - #20">(a) a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in, in the case of Notes in definitive form only, the relevant pla...
  - #20">(b) a day on which the TARGET2 System is open.
- #20">4.6 Interpretation of principal and interest
  - #20">(a) any additional amounts which may be payable with respect to principal under Condition 7 (Taxation); and
  - #20">(b) any premium and any other amounts (other than interest) which may be payable by the Issuer under or in respect of the Notes.
#20">5. Redemption and Purchase
- #20">5.1 Redemption at maturity
- #21">5.2 Redemption due to a Tax Event
  - #21">(a) on the occasion of the next payment due under the Notes, the Issuer has or will become obliged to pay additional amounts as provided or referred to in Condition 7 (Taxation) in each case as a result of any change in, or amendment to, the laws or r...
  - #21">(b) the Issuer would not be entitled to claim a deduction in computing taxation liabilities in any Tax Jurisdiction in respect of any payment of interest to be made on the Notes on the occasion of the next payment date due under the Notes or the value...
  - #21">in the case of (a) and (b) above, provide that such obligation or loss or reduction of deduction cannot be avoided by the Issuer taking reasonable measures available to it.
- #21">5.3 Redemption due to a MREL Disqualification Event
  - #21">Prior to the publication of any notice of redemption pursuant to this Condition, the Issuer shall deliver to the Agent to make available at its specified office to the Noteholders a certificate signed by two Authorised Signatories of the Issuer stati...
  - #22">A "MREL Disqualification Event" shall be deemed to have occurred if there is a change in, or amendment to, the Applicable MREL Regulations, or any change in the application or interpretation thereof, as a result of which all or part of the outstandin...
  - #22">(a) where such change in, or amendment to, the Applicable MREL Regulations was reasonably foreseeable at the Issue Date.
    - #22">For the purpose of paragraph (a) above, the circumstances where any non-qualification of the Notes as MREL-Eligible Senior Non-Preferred Instruments shall not be "reasonably foreseeable" shall, without limitation, be deemed to include where such non-...
  - #22">(b) where the non-qualification as MREL-Eligible Senior Non-Preferred Instruments is due solely to the remaining maturity of such Notes being less than any period prescribed by the Applicable MREL Regulations as at the Issue Date; or
  - #22">(c) where the non-qualification as MREL-Eligible Senior Non-Preferred Instruments is a result of the relevant Notes being bought back by on or behalf of the Issuer.
- #22">5.4 Purchases
- #22">5.5 Cancellation
#22">6. SUBSTITUTION AND VARIATION
- #23">An "Alignment Event" is deemed to have occurred if there is a change in, or amendment to, the Applicable MREL Regulations, or any change in the application or interpretation thereof, that results in the requirements for the Notes to qualify as MREL-E...
#23">7. Taxation
- #23">(a) presented for payment in Spain; or
- #23">(b) to, or to a third party on behalf of, a holder who is liable for such taxes or duties in respect of such Note or Coupon by reason of his having some connection with a Tax Jurisdiction other than the mere holding of such Note or Coupon; or
- #23">(c) presented for payment more than 30 days after the Relevant Date except to the extent that the holder thereof would have been entitled to an additional amount on presenting the same for payment on such thirtieth day assuming that day to have been a...
- #23">(d) to, or to a third party on behalf of, a Spanish-resident legal entity subject to Spanish Corporation Income Tax if the Spanish Tax Authorities determine that the Notes do not comply with applicable exemption requirements including those specified ...
- #23">(e) to, or to a third party on behalf of, a holder in respect of whom the Issuer does not receive such information concerning such Noteholder's identity and tax residence as may be required in order to comply with the procedures that may be implemente...
#24">8. Prescription
#24">9. Events of Default
#24">10. WAIVER OF SET-OFF
#24">11. Replacement of Notes and Coupons
#25">12. Notices
#25">13. Meetings of Noteholders and Modification
- #25">13.1 Meetings of Noteholders
- #26">13.2 Modification
  - #26">(a) any modification of, the Notes, the Coupons or any of the provisions of the Agency Agreement which is of a formal, minor or technical nature or is made to correct a manifest error or to comply with mandatory provisions of the law, or
  - #26">(b) any modification (except a Basic Terms Modification (being a matter in respect of which an increased quorum is required as mentioned above)) of the Notes, the Coupons or the Agency Agreement which is not prejudicial to the interests of the Notehol...
#26">14. Further Issues
#26">15. Contracts (Rights of Third Parties) Act 1999
#26">16. BAIL-IN
- #26">16.1 Acknowledgment
  - #26">(a) to be bound by the effect of an exercise of the Bail-in Power by the Relevant Resolution Authority, which exercise may include and result in any of the following, or some combination thereof:
    - #26">(i) the reduction of all, or a portion, of the Amounts Due on a permanent basis;
    - #26">(ii) the conversion of all, or a portion, of the Amounts Due into ordinary shares, other securities or other obligations of the Issuer or another person (and the issue to or conferral on the Noteholder of such shares, securities or obligations), inclu...
    - #27">(iii) the cancellation of the Notes or Amounts Due;
    - #27">(iv) the amendment or alteration of the maturity of the Notes or amendment of the amount of interest payable on the Notes, or the date on which the interest becomes payable, including by suspending payment for a temporary period; and
  - #27">(b) that the terms of the Notes are subject to, and may be varied, if necessary, to give effect to, the exercise of the Bail-in Power by the Relevant Resolution Authority.
- #27">16.2 Payment of Amounts Due
- #27">16.3 Notice to the Noteholders
- #27">16.4 Duties of the Paying Agent
- #27">16.5 Proration
- #27">16.6 Conditions Exhaustive
#27">17. Governing Law and Submission to Jurisdiction
- #27">17.1 Governing law
- #28">17.2 Submission to jurisdiction
  - #28">(a) Subject to Condition 17.2(c) below, the English courts have exclusive jurisdiction to settle any dispute arising out of or in connection with the Notes and/or the Coupons, including any dispute as to their existence, validity, interpretation, perf...
  - #28">(b) For the purposes of this Condition 17.2, the Issuer waives any objection to the English courts on the grounds that they are an inconvenient or inappropriate forum to settle any Dispute.
  - #28">(c) To the extent allowed by law, the Noteholders and the Couponholders may, in respect of any Dispute or Disputes, take (i) proceedings in any other court with jurisdiction; and (ii) concurrent proceedings in any number of jurisdictions.
- #28">17.3 Appointment of Process Agent
#28">18. DEFINITIONS
- #29">"Calculation Amount" means 100,000.
- #29">"Day Count Fraction" means, in respect of any period, the number of days in the relevant period, from (and including) the first day in such period to (but excluding) the last day in such period, divided by the number of days in the Regular Period in w...
- #31">(a) contain terms that comply with the then current requirements for MREL-Eligible Senior Non-Preferred Instruments as embodied in the Applicable MREL Regulations; and
- #31">(b) carry the same rate of interest as the Notes prior to the relevant substitution or variation; and
- #31">(c) have the same denomination and aggregate outstanding principal amount as the Notes prior to the relevant substitution or variation; and
- #31">(d) have the same maturity date and the same dates for payment of interest as the Notes prior to the relevant substitution or variation; and
- #31">(e) have the same ranking as the Notes;
- #31">(f) not, immediately following such substitution or variation, be subject to a Tax Event or a MREL Disqualification Event; and
- #31">(g) be listed or admitted to trading on any stock exchange as selected by the Issuer, if the Notes were listed or admitted to trading on a stock exchange immediately prior to the relevant substitution or variation.
- #31">"RD 1012/2015" means Royal Decree 1012/2015 of 6 November 2015, implementing Law 11/2015 (Real Decreto 1012/2015, de 6 de noviembre, por el que se desarrolla la Ley 11/2015, de 18 de junio, de recuperación y resolución de entidades de crédito y empres...
- #32">"RD 84/2015" means Royal Decree 84/2015, of 13 February, implementing Law 10/2014 (Real Decreto 84/2015, de 13 de febrero, por el que se desarrolla la Ley 10/2014, de 26 de junio, de ordenación, supervisión y solvencia de entidades de crédito), as ame...
- #32">"Regular Period" means each period from (and including) the Issue Date or any Interest Payment Date to (but excluding) the next Interest Payment Date.
  - #32">"Relevant Date" means the date on which such payment first becomes due, except that, if the full amount of the moneys payable has not been duly received by the Agent on or prior to such due date, it means the date on which, the full amount of such mon...
  - #33">"Tax Jurisdiction" means Spain or any political subdivision or any authority thereof or therein having power to tax.
  - #33">"Waived Set-Off Rights" means any and all rights or claims of any Noteholder for deduction, set-off, netting, compensation, retention or counterclaim arising directly or indirectly under, or in connection with, any Note.
- #35">Authorisation
- #35">Listing of Notes
- #35">Documents Available
- #35">Clearing Systems
- #35">The Notes have been accepted for clearance through the Clearstream, Luxembourg and Euroclear systems (which are entities in charge of keeping the records). The Common Code and International Securities Identification Number for the Notes are 167915809...
  - #35">The address of Euroclear is 1 Boulevard du Roi Albert II, B-1210 Brussels, Belgium and the address of Clearstream, Luxembourg is 42, Avenue J.F. Kennedy, L-1855 Luxembourg.
- #35">Significant or Material Change
- #35">Auditors
- #36">Yield
- #36">Estimated Expenses in connection with the Admission to trading