MULTICURRENCY CERTIFICATES OF DEPOSIT PROGRAMME OF EUR 150,000,000 (DEPOSITOBEWIJZEN / CERTIFICAT DE DEPOT) - Bank J.Van Breda & C Information ...
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Information Memorandum
Bank J.Van Breda & C°
MULTICURRENCY CERTIFICATES OF DEPOSIT
PROGRAMME
OF EUR 150,000,000
(DEPOSITOBEWIJZEN / CERTIFICAT DE DEPOT)
Arranger & Domiciliary Agent
Dealers
November 2006
TABLE OF CONTENTS
TABLE OF CONTENTS 2
AFFIDAVIT 3
I. IMPORTANT NOTICE 4
II. TERMS AND CONDITIONS OF THE PROGRAMME 6
III. SELLING RESTRICTIONS 16
IV. PRESENTATION OF BANK J.VAN BREDA & C° N.V. 17
1. Brief business description 17
2. Organisation and shareholders 18
2.1 Organisation chart 18
3. 2005: profit growth for the tenth year in succession 19
3.1 Niche strategy 20
3.2 Commission income rises by 21 % 20
3.3 Van Breda Car Finance 21
3.4 Leasing J.Van Breda & C° sold to BPLG 21
3.5 Targeted Personnel Policy 21
3.6 Commercial IT Policy 22
3.7 Positive long-term outlook 22
3.8 Risk management 23
3.9 Corporate Governance 25
4. Financial information 27
4.1 Core figures 27
4.2 Consolidated balance sheet of Bank J.Van Breda & C° as at 31 Dec 2004 and 2005
28
4.3 Consolidated Profit and loss account of Bank J. Van Breda & C° as at 31 Dec 2004 and
2005 30
4.4 Statement of changes in equity 31
4.5 Key figures Bank J. Van Breda & C° 32
V. UNOFFICIAL TRANSLATION OF THE CLEARING AGREEMENT 33
2AFFIDAVIT
The undersigned, acting as duly authorised officers of Bank J.Van Breda & C° N.V., as issuer
under this multi-currency Certificate of Deposit programme (“ the Programme”), having made
all reasonable enquiries, confirm that, to best of their knowledge and belief:
i. This information memorandum (the “Information Memorandum”) and its
supplemented documents contain all information regarding itself and the Certificates
of Deposit to be issued under the Programme, which is material in the context of this
Programme.
ii. The information contained in the Information Memorandum and all supplemented
documents is true and accurate in all material respects and is not misleading.
iii. The opinions and intentions expressed in the Information Memorandum are honestly
held, and
iv. There are no other facts the omission of which would, in the context of the
Programme and the issuance of Certificates of Deposit thereunder, make any such
information or the expression of any such opinions or intentions misleading.
In accordance with the terms of the royal decree of October 14, 1991 concerning the “billets
de trésorerie et certificats de dépôt / thesauriebewijzen en depositobewijzen”, the Issuer
accepts responsibility for the information contained in this Information Memorandum and shall
compensate any investor for material damage arising directly from the omission or falseness
of any information.
Made on November 10th, 2006.
Signed by
Bank J.Van Breda & C° N.V.
3I. IMPORTANT NOTICE
This Information Memorandum contains information provided by Bank J.Van Breda & C° N.V. in
connection with the Programme, i.e. an EUR 150,000,000 multi-currency Programme for the issue of
dematerialised “certificates of deposit/certificates de dépôts/depositocertificaten” (“Certificates of
Deposit”) governed by the law of 22 July 1991 as amended from time to time (the “Law”) and the royal
decree of 14 October 1991 as amended from time to time (the “Royal Decree”) (the “Certificates of
Deposit”) by Bank J.Van Breda & C° N.V. (hereinafter referred to as the “Issuer”). An agreement with
respect to the Programme has been concluded on 5 May 1999 between the Issuer, the Domiciliary
Agent (as defined below) and the Dealers (as defined below) (the “Agreements”).
The Issuer certifies that, to the best of its knowledge and belief, the information contained in this
Information Memorandum and its supplements, if any, is in accordance with the facts and does not omit
anything likely to affect the import of such information.
The Issuer accepts responsibility for this Information Memorandum and its supplements, if any. In
particular, the Issuer will be responsible towards interested parties for the losses which may occur as an
immediate and direct result of the absence or incorrectness of any information required to be mentioned
pursuant to the Law and/or the Royal Decree.
Everyone should be aware that, in the present document, as foreseen by the Law and the Royal
Decree, the term “Information Memorandum” always and in all circumstances includes any supplement,
updates, annual and semi-annual reports (if available) and financial information such as income
statements and balance sheets of the Issuer.
This Information Memorandum contains information concerning the Programme and the Issuer but is not
intented to provide the basis of any credit, taxation or other evaluation and should not be reconsidered
as a recommendation by the Dealer that any recipient hereof should buy any Certificate of Deposit.
Each investor considering an investment under the Programme shall be deemed to have made its own
independent investigation into the financial condition and affairs and its own appraisal of the
creditworthiness of the Issuer and thus, in making its decision to invest, shall not rely, and shall be
deemed not to have relied upon, any information or advice whatsoever, regarding the Issuer, provided
by the Dealer and/or the Domiciliary Agent.
KBC Bank NV and Bank J.Van Breda & C°, Naamloze Vennootschap have been appointed by the
Issuer as its dealers (hereinafter together referred to as the “Dealers”, individually a “Dealer”), and
therefore every holder or prospective holder of Certificates of Deposit may require from the Dealers the
delivery of an Information Memorandum. This document is also available at the administrative and
commercial office of the Issuer and will be delivered to any investor in the Certificates of Deposit. KBC
Bank NV has been appointed by the Issuer as its domiciliary agent (KBC Bank, in its capacity of
domiciliary agent, will hereinafter be referred to as the “Domiciliary Agent”).
No warranty or undertaking, expressed or implied, is made and no responsibility or liability is accepted
by the Dealers or the Domiciliary Agent as to the accuracy or completeness at any time of this
Information Memorandum or any further information given in connection with the Programme. The
Dealers and the Domiciliary Agent expressly do not undertake to advise any investor in the
Certificates of Deposit concerning any information coming to their attention and could not be held
responsible for any lack of information towards the investors.
This Information Memorandum does not constitute, and may not be used for the purpose of an offer,
invitation or solicitation by anyone in any jurisdiction or in any circumstances in which such offer,
invitation or solicitations is not authorised or to any person to whom it is unlawful to make such offer,
invitation or solicitation. Persons in possession of this Information Memorandum are required to respect
the Selling Restrictions set out herein.
Specific conditions of each issue of Certificates of Deposit will be mentioned in the “Investor’s
Confirmation” that will be provided to each investor.
The Issuer fulfils the financial prerequisites detailed in article 13 of the Royal Decree, as amended, and
is therefore entitled to issue Certificates of Deposit. As at 31 December 2005, shareholders’ equity of
the Issuer reached more than EUR 25,000,000.
The Dealers and the Domiciliary Agent will, in connection with such appointment or under Certificates of
Deposit act solely for and upon the instructions of the Issuer and will
incur no liability for or in respect of any action taken by them pursuant to the Law and/or the Royal
Decree, nor will they have any obligations towards, or a relationship of agency or trust with any of the
owners of Certificates of Deposit.
4The net proceeds of the Certificates of Deposit will be applied by the Issuer to meet part of its general
financing requirements.
5II. TERMS AND CONDITIONS OF THE PROGRAMME
Bank J.Van Breda & C° N.V.
EUR 150,000,000
Multicurrency Programme for the issue of
Certificates of Deposit
Issuer : Bank J.Van Breda & C° N.V.
Registered Office :
Plantin en Moretuslei 295
B-2140 Antwerp
From 2007: Ledeganckkaai 7, 2000 Antwerp
Law : The Law of 22 July 1991 concerning “thesauriebewijzen en
depositobewijzen/billets de trésorerie et certificates de depot”, as published in
the Official Gazette of 21 September, 1991 (as amended from time to time).
Royal Decree : The Royal Decree of 14 October 1991 concerning “thesauriebewijzen en
depositobewijzen/billets de trésorerie et certificats de depot”, as published in
the Official gazette 19 October 1991 (as amended from time to time).
Form of Certificates
of Deposit : The advances granted by investors within the framework of this Programme
shall be evidenced by Certificates of Deposit (Depositocertificaten) issued on
a dematerialised basis in book-entry form in accordance with the Law and the
Royal Decree and may not be converted into another form.
Euro and EUR : Means, the lawful currency of the participating member states of the
European Union that have adopted the single currency in accordance with
the Treaty establishing the European Communities, as amended by the
Treaty on European Union.
Selected Currency : Means, the lawful currency of each of the member states of the Organisation
for Economic Co-operation and Development (“OECD”), excluding the EUR,
provided the Clearer accepts such currency and subject to compliance with
all applicable laws, regulations and requirements of the relevant central bank
or equivalent body;
Maximum Amount : At any given time the maximum nominal amount of all the Certificates of
Deposit from time to time outstanding under the Programme, being EUR
150,000,000 (or the equivalent thereof in any Selected Currency). For this
purpose, the equivalent in EUR of a Certificate of Deposit denominated in a
Selected Currency shall be calculated on the basis of the latest indicative
exchange rate published by the European Central bank on either Reuters
page LOCKING, or Reuters page ECB37 at or about 2:15 p.m. on the
Business Day preceding the Issue Date. The equivalent of the already
outstanding Certificates of Deposit shall be calculated on the basis of the
same conversion rate.
Duration of the
Programme: Undetermined. The Programme may be terminated at any time provided that
the present terms and Conditions will remain in full force and effect with
respect to the Certificates of Deposit issued under the Programme for so long
as such Certificates of deposit shall remain outstanding. The Issuer, the
Domiciliary Agent or the dealer will, save in case of an Event of Default,
respect a 60 days prior written notice thereof to the other parties, provided
6however that, save in case of an Event of Default, such determination may not
take place earlier than 6 months after the date of setting up the Programme.
Denominations : At any given time a minimum amount of EUR 250,000 or the equivalent in
any Selected Currency or such other denominations as may be determined
by the Law and/or the Royal Decree.
Nominal Amount : Nominal Amount means the principal amount or the par value of a Certificate
of Deposit, exclusive of premium or interest payable by the relevant Issuer at
the Maturity Date of such Certificate of Deposit; it is also the value used for
the calculation of interest of an Interest-bearing Certificate of Deposit.
Tenor of the
Certificates of Deposit: Means, in relation to any Certificate of Deposit, the period from the Issue
Date up to but excluding the Maturity Date. The tenor of the Certificates of
deposit will not be less than 7 days. Should any amendment to the Law
and/or the Royal Decree define a maximum tenor or impose a minimum
tenor, such new limit shall automatically apply to the Certificates of Deposit
issued on or after the implementation date of such amendment.
Interest:
(a) The Certificates of Deposit generating periodical interest payments at a
fixed or floating rate shall be designated as “Interest-bearing Certificates of
Deposit”;
(b) The Certificates of Deposit issued on a discount basis shall be designated
as “Discount Certificates of Deposit”, in case of a maturity shorter than or
equal to one year, or as “Zero Coupon Certificates of Deposit”, in case of a
maturity longer than one year.
Interest Payment Date: means, in relation to any Interest-bearing Certificates of Deposit, a day
determined in accordance with the following provisions:
(a) for interest-bearing Certificates of Deposit with a fixed rate of
interest:
(i) the first Interest Payment Date shall fall on the date of
the first anniversary of the Issue Date of such Certificate of
Deposit and each subsequent Interest Payment Date, if
any, shall fall on the date of the anniversary in each year of
the Issue Date of such Certificate of Deposit, however with
the possibility for the relevant Issuer and the investors to
agree upon a shorter or longer interest period;
(ii) the final Interest Payment Date shall fall on and coincide
with the Maturity Date of such Certificate of Deposit;
(iii) the “anniversary” of an Issue Date in each year shall
mean the day falling in the same month as and numerically
corresponding to the Issue Date of such Certificate of
Deposit.
(b) for interest-bearing Certificates of Deposit with a floating rate of
interest :
(i) the first Interest Payment Date shall fall on the date
which is 1, 2, 3, 6 or 12 months or such other periods as
the Issuer and the investors may agree upon after the Issue
Date of such Certificate and each subsequent Interest
Payment Date shall fall on the date which is respectively 1,
2, 3, 6 or 12 months or such other period as the Issuer and
the investors may agree upon after the preceding Interest
Payment Date;
(ii) the final Interest Payment Date shall fall on and coincide
with the Maturity Date of such Certificate of Deposit.
7(c) If any Interest Payment Date determined in accordance with the
above provisions is not a Business Day, payment of the relevant
interest amount shall be postponed to the next Business Day,
unless, in case of floating rate notes, such day falls in the next
calendar month, in which event it shall mature on the immediately
preceding Business Day. Such change of Interest Payment Date will
not entitle the relevant holders of Notes to any payment claim nor to
any interest claim or other compensation.
Interest Rate : On each Interest Payment Date in respect of Interest-bearing Certificates of
Deposit, interest will be paid thereon calculated at the agreed fixed or floating
rate. Fixed interest will be calculated on the basis of twelve months of thirty
days divided by 360. Floating interest will be calculated on the basis of the
actual number of days elapsed divided by 360 or 365 following market
practice for the relevant currency.
Late Payment Interest : Any amount remaining unpaid under any Certificate of Deposit shall itself
bear interest without prior notice and until the actual payment of all amounts
due, such late payment interest being calculated in respect of Certificates of
Deposit in EUR on a day to day basis at the rate of 1% per annum above “het
marginale voorschottentarief van de Europese Centrale Bank (as
published on Reuters page ECB01) or, in respect of Certificates of Deposit in
any Selected Currency above the prevailing overnight inter-bank offered rate
in the relevant currency as published on the relevant page of the Reuters
Screen at 11.00 a.m. in the financial centre where such inter-bank offered
rate is fixed. Late Payment Interest will not be calculated on a compound
basis.
Issue price : (a) The issue price of each Discount Certificate of Deposit will be
calculated as follows:
NA
IP =
⎛T Y ⎞
1+ ⎜ . ⎟
⎝ X 100 ⎠
where : IP is the issue price
NA is the nominal amount of the Certificate of Deposit
T is the actual number of days elapsed between the
Issue Date (included) and the Maturity Date (excluded) of
the Certificate of Deposit
Y is the annual yield of the Certificate of Deposit
X is 360 or 365 days according to the ISDA day count
conventions applicable to the currency of issue.
(b) Interest-bearing Certificates of Deposit may be issued at par, at a
discount or at premium to their nominal amount.
(c) The issue price of each Zero Coupon Certificate of Deposit will be
calculated as follows:
NA
IP = T
⎛ Y ⎞X
⎜1 + ⎟
⎝ 100 ⎠
where : IP is the issue price
NA is the nominal amount of the Certificate of Deposit
T is the actual number of days elapsed between the Issue
Date (included) and the Maturity Date (excluded) of the
Certificate of Deposit
Y is the annual yield of the Certificate of Deposit
8X is the actual number of days in a year or such
other basis that may be the market practice for the relevant
currency at the time of issue of the Certificate of Deposit
Business Day : Means, in relation to Certificates of Deposit denominated in EUR, a day on
which the Trans-European Automated Real-Time Gross Settlement Express
Transfer (TARGET) System and the clearing system operated by the Clearer
are open for business and, in relation to Certificates of Deposit denominated
in any Selected Currency, a day on which banks, clearing systems and
exchange markets are open for business in Brussels and in the country of the
relevant Selected Currency in which the Treasury Notes are denominated.
Issue Date : Means, in relation with any Certificates of Deposit, the Business day on which
such Certificates of Deposit are issued under the Programme and on which
cash payments are due to be made by the subscribers of the Certificates of
Deposit to the Issuer and, if applicable, a which a Certificate of Deposit starts
to yield interest..
Maturity Date : Means in relation to any Certificates of Deposit, the day (which shall be a
Business Day) on which such Certificates of Deposit become due and
payable pursuant to the terms thereof. If the day set forth as Maturity Date is
not a Business Day, repayment of the relevant amount of the Certificates of
Deposit shall be made on the next succeeding Business Day, without the
relevant Noteholders being entitled to any payment claim nor to any interest
claim or other compensation with respect to such postponement.
Clearer : Means the Nationale Bank van België N.V./S.A. Banque Nationale de
Belgique or any other entity entitled by law to operate a clearing system and
with whom the Issuer and the Domiciliary Agent have concluded a clearing
agreement or to whom the rights and obligations of the National Bank of
Belgium N.V./ S.A. Banque Nationale de Belgique shall be transferred by
operation of Article 38 of the law of 15 July 1998 amending certain statutory
provisions in relation to financial instruments and clearing systems (which is
expected to be the Belgian Deposito- en Consignatiekas/Caisse de Dépôts et
Consignations, or CIK).
Status and
Negative Pledge : The Certificates of Deposit shall represent direct, unconditional,
unsubordinated and unsecured obligations of the Issuer. At all times they
shall rank pari passu with all other present and future unsubordinated and
unsecured obligations of the Issuer for funds borrowed or guaranteed by the
Issuer (except for those that are preferred by operation of law).
As long as any of the Certificates of Deposit is outstanding, the Issuer shall
not create nor have outstanding any mortgage, pledge, lien or other security
interest (other than arising by operation of law) upon the whole or any part of
its assets, present or future, to secure any present or future indebtedness of
the Issuer represented by any financial instruments, including but not limited
to commercial paper, bonds, Eurobonds and other securities of the Issuer
(hereinafter the “Security”), without granting equally and rateably, at the same
time, to the holders of the Certificates of Deposit the same Security.
Events of default If :
(i) the Issuer fails to pay in part or in full any sum under any Certificate of
Deposit as and when it shall become due and payable either at Maturity Date
or Interest Payment Date, upon redemption or otherwise, and such failure is
continuing for 5 Business Days after the date on which such sum was due,
except if such non-payment or late payment is due to any (in)action of the
Domiciliary Agent or disfunctioning of the Clearing System; or
(ii) the Issuer fails to duly observe or perform any other of the material
undertakings contained herein and such failure is continuing for 15 Business
9Days after the date on which written notice of such failure requiring the Issuer
to remedy the same shall have been addressed to the Domiciliary Agent by
holders of any Certificates of Deposit at that time outstanding; or
(iii) the Issuer commences negotiations with any one or more of its creditors
with a view to a general readjustment or rescheduling of its indebtedness or
makes a general assignment for the benefit of or a composition with its
creditors; or
(iv) the Issuer defaults in the due payment of any other indebtedness having
a minimum aggregate amount of EUR 1 million of, or assumed or guaranteed
by, the Issuer, unless the relevant payment is contested in good faith by the
Issuer and by appropriate proceedings, and provided any such default has
not been cured within the period contractually agreed upon or subsequently
agreed upon for such payment, or any such indebtedness shall have become
repayable before the due date thereof as a result of acceleration of maturity
by reason of occurrence of any event of default thereunder; or
(v) the Issuer takes any corporate action or other steps are taken or legal
proceedings are started (in a voluntary or involuntary case) for its windingup,
dissolution or reorganisation or for the appointment of a receiver, liquidator,
sequestrator (or other similar official) of the Issuer or of any substantial part of
its property under any applicable bankruptcy or insolvency law or any
other similar law, other than a judicial composition (“Gerechtelijk Akkoord”)
under the law of 17 July 1997; or
(vi) any representation, warranty or statement made by the Issuer in
connection with the Information Memorandum (or any amendments thereto)
or herein is proved to have been incorrect in any material respect; or,
(vii) the Issuer becomes insolvent or is declared insolvent by a competent
jurisdiction or stops, suspends or threatens to stop or suspend payment of all
or a material part of its debt, or ceases or threatens to cease to carry on all or
a material part of its business; or a moratorium is proposed, agreed or
declared in respect of all or a material part of the business or a moratorium is
proposed, agreed or declared in respect of all or a material part of the
indebtedness of the Issuer or the Issuer commences a voluntary case or an
order is presented under any applicable bankruptcy or insolvency law or any
other similar law; or
(viii) it becomes unlawful for the Issuer to perform any of its obligations under
the Certificates of Deposit or any of its obligations ceases to be valid, binding
or enforceable;
then, in each and every such case, any holder of a Certificate of Deposit may,
by written notice by registered letter to the Domiciliary Agent and the Issuer,
declare that such Certificate of Deposit shall be forthwith due and payable,
whereupon as from the date of notice, such Certificate of Deposit shall
become immediately due and payable, interests included.
Selling restrictions : In Belgium, there are no restrictions in respect of the purchase and transfer of
the Certificates of Deposit other than (i) that the Certificates of Deposit are to
be kept at all times on a securities account with a participant in the Clearing
System, and (ii) no issuance or transfer of Certificates of Deposit may result
in any investor holding Certificates of Deposit for an amount of less than EUR
250,000.
Outside Belgium, the Certificates of Deposit may be purchased, offered or
sold only in compliance with applicable laws and regulations of these
jurisdictions and/or of the home countries of the relevant currencies in
which they are purchased, offered or sold.
Taxation : The following is a general summary of Belgian taxation as of the date hereof
in relation to payments made under and other transfers involving the
Certificates of Deposit. lt is not exhaustive and holders of Certificates of
10Deposit who are in doubt as to their tax position should consult their
professional advisors.
(a) by application of the Belgian law of 6 August 1993 concerning
transactions in certain securities, the Belgian withholding tax, of which
the rate currently is 15%, is not levied if the Certificates of Deposit are
booked on an account that bas been opened in the books of a direct or
indirect participant of the X/N clearing system of the Nationale Bank van
België/Banque Nationale de Belgique (“BNB”), and if the holder of the
Certificate of Deposit falls within the category of persons which may
open an X-account In accordance with article 4 of the Royal decree of 26
May 1994 regarding the collection and the reallowance of withholding
taxes. This category includes:
(i) domestic companies referred to in article 2 § 2, 2° of the lncome Tax
Code of 1992; (ii) without prejudice to article 262,1° and 5° of the lncome
Tax Code of 1992, the institutions, organisations or companies referred
to in article 2 § 3 of the Law of 9 July 1976 with respect to the
supervision of the insurance companies, other than those referred to
under 1° and 3°; (iii) semi-governmental institutions for social security or
assimilated institutions specified in article 105, 2° of the royal decree of
27 August 1993 implementing the Income Tax Code of 1992; (iv) non-
resident savers referred to in article 105, 5° of the same royal decree; (v)
investment funds referred to in article 115 of the same royal decree; (vi)
tax-payers referred to in article 227, 2° of the Income Tax Code of 1992
that have applied the earnings for their professional activities in Belgium
and are submitted to the non-resident tax in accordance with article 233
of the same Income Tax Code; (vii) the Belgian State, for its investments
exempted from withholding tax in accordance with article 265 of the
same lncome Tax Code; (viii) foreign investment funds that are an
undivided patrimonium managed by a management corporation on
behalf of the participants, if their rights of participation are not publicly
issued in Belgium nor sold, (ix) the resident companies not referred to in
(i) having an activity that consists solely or mainly of granting credits and
loans and (x) only for the revenueson certicates of deposit issued by
legal persons being part of the sector of public authorities in the of sense
the European System of integrated Economic Accounts (ESIEA) ,for the
application of the European Communities Rule N° 3605/93 of November
22, 1993 on the application of the protocol on the procedure concerning
excessive deficits attached to the treaty of the European Communities,
the legal persons that are part of the sector of public authorities in the
sense of the European System of integrated Economic Accounts
(ESIEA).
Furthermore, the specific form claimed by Belgian Tax Authorities has to
be completed by the holder of the Certificates of Deposit and to be kept
by its Custodian Bank at the disposal of the Belgian Tax Authorities.
If the holder of the Certificates of Deposit does not belong to, or ceases to
belong to, one of the categories listed in article 4 of the royal decree of 26
May 1994, as amended, its account with the clearing system organised by
the Clearer will be designated as a non-exempted account ("N-account"),
and, therefore, the holder of the Certificates of Deposit will be submitted to
the withholding tax.
lt is expected that, in the future, the operation of the clearing system for
corporate debt securities will be transferred from the BNB to the CIK. In the
event of such transfer, it is expected that the rules relating to withholding tax
on interest payments or securities held in the BNB system will continue to
apply to such securities held in the CIK.
(b) a holder of a Certificates of Deposit, who derives income from a
Certificate of Deposit, or who realises a gain on disposal or redemption of a
Certificate of Deposit, will, apart from Belgian withholding tax -if applicable,
see (a)- not be subject to Belgian taxation on income or capital gains unless
(i) the holder is a non-resident who is using the Certificates of Deposit in a
fixed base or permanent establishment which the maintains in Belgium, (ii)
the holder is a private individual resident of Belgium who is using the
11Certificates of Deposit for his professional activity or (iii) the holder is a
private individual whose income or capital gains arise from transactions going
beyond the daily course of management of private property, or (iv) the holder
is a company resident in Belgium;
(c) the Certificates of Deposit will not be subject to Belgian gift taxes provided
the gift is not required to be and is not made or evidenced by a deed or other
instrument subject to registration in Belgium;
(d) the Certificates of Deposit will not be subject to Belgian inheritance taxes
if held by persons not resident in Belgium at the time of their death;
(e) the Belgian tax on delivery of bearer securities will not be levied on the
Certificates of Deposit so long as they are maintained in the X/N clearing
system of the BNB.
Early Redemption for
tax reasons : If, as a result of any amendment to or any change in the laws or regulations
of the Kingdom of Belgium or any political subdivision thereof or agency
thereof or therein or in the interpretation or administration of any such laws or
regulations which becomes effective on or after the Issue Date of the relevant
Certificates of Deposit, Certificates of Deposit held by holders of Certificates
of Deposit belonging to one of the categories of investors as listed in article 4
of the Royal Decree of 26 May 1994 regarding the collection and the
reallowance of withholding taxes, would become subject to withholding tax on
the occasion of the next Interest Payment Date in respect of such Certificates
of Deposit, the Issuer may, at its option, pay the Additional Amounts or
redeem all, but not some only, of the Certificates of Deposit held by such
holders of Certificates of Deposit which would be subject to such withholding
(in no case earlier than 30 days before the effective date of such new
treatment) upon notice being given not less than 15 days prior to the
redemption date.
In this event, the Certificates of Deposit will be redeemed :
(i) in the case of Discount Certificates of Deposit and Zero Coupon
Certificates of Deposit, at a price which is calculated according to the
formulae given in “Issue Price” above.
Considering that, for the purpose of these formulae :
(a) the issue price is to be understood as the redemption price;
(b) the annual yield remains the issue yield;
(c) the exact number of days to take into account are those remaining
between the early redemption date and the Maturity Date.
(ii) in the case of Interest-bearing Certificates of Deposit, at their principal
amount in the relevant currency together with accrued interest up to the date
fixed for redemption.
Stamp duty/TOB : The Certificates of Deposit are exempt from stamp duty, as well as from TOB
(Stock Exchange Tra1nsaction Tax /Taks op Beursverrichtingen) pursuant to
the Law.
Governing law
& Jurisdiction : The Certificates of Deposit shall be governed by the laws of the Kingdom of
Belgium and shall be subject to the exclusive jurisdiction of the courts of
Brussels, Belgium.
Listing : The Certificates of Deposit will not be listed on a Belgian or other stock
exchange or regulated market.
12Secondary market : Should an investor wish to sell a Certificate of Deposit before its Maturity
Date, the Dealers shall, at a best-effort basis, try to find a buyer for it, without
making any commitment to repurchase such Certificate of Deposit.
Each investor is allowed to sell one or several Certificates of Deposit it owns,
provided that the aggregate nominal amounts of both the Certificate(s) of
Deposit on sale and of the Certificate(s) of Deposit to remain in its hands, if
any, after such sale represent each at least EUR 250,000 or its approximate
equivalent in any Selected Currency, pursuant to article 6 of the Royal
Decree.
With regard to the Certificates of Deposit denominated in a Selected
Currency article 2 § 2 of the royal decree of 14 June 1994 stipulates that no
transaction may occur on a value date falling two Business Days or less
before a Maturity Date or an Interest Payment Date.
Domiciliary and
Paying agent : KBC Bank NV
Arranger : KBC Bank NV
Dealers : KBC Bank NV
Bank J.Van Breda & C° N.V.
Delivery/Custody : The Certificates of Deposit issued on a dematerialised basis shall be
recorded in the securities account of each investor with its Custodian Bank.
The Certificates of Deposit will be delivered to the securities account of the
investor with its Custodian and cash payments will be made to the cash
account of the investor with its Custodian within and in accordance with the
regulations governing the clearing system organised by the Clearer. The
Certificates of Deposit will thus be represented by book-entries and the
holders of the Certificates of Deposit will not be entitled to the exchange into
Certificates of Deposit in bearer, registered or any other form.
Where:
Clearer means the Nationale Bank van België N.V./S.A. Banque Nationale
de Belgique or any other entity entitled by law to operate a clearing system
and with whom the Issuer and the Domiciliary Agent have concluded a
Clearing Agreement or to whom the rights and obligations of the Nationale
Bank van België N.V./S.A. Banque Nationale de Belgique shall be
transferred by operation of Article 38 of the law of 15 July 1998 amending
certain statutory provisions in relation to financial instruments and clearing
systems (which is expected to be the Belgian Deposito- en
Consignatiekas/Caisse de Dépôts et Consignations, or CIK).
Clearing System means the clearing system established by:
- articles 3 to 12 of the law of January 2, 1991 on the market of public
debt securities and the monetary policy instruments, as amended
from time to time;
- the law of August 6, 1993 on the Transactions on Certain Securities,
as amended, and its royal decrees of implementation of May 26 and
June 14, 1994, as amended from time to time;
- the law of July 15, 1998 amending certain legislation relating to
financial instruments and securities clearing systems, as amended
from time to time and its royal decrees of implementation.
13- the law of August 2, 2002 on supervision of the financial industry and
financial services, when it will have entered into force.
Custodian Bank means any of the institutions approved by the Belgian
Ministry of Finance and participating in the clearing system organised by the
Clearer. Participants in the Clearing System of the Nationale Bank van België
N.V./S.A. Banque Nationale de Belgique include most Belgian banks and
stock brokers, Euroclear Bank S.A./N.V. as operator of the Euroclear system
("Euroclear"), Clearstream Banking société anonyme (“Clearstream”) and
banks established in a country belonging to the European Community.
Notices : Notices to the holders of Certificates of Deposit shall be validly given (i) by
fax or letter addressed to the holders of Certificates of Deposit having a
securities account or to the Custodian Bank holding the securities with the
Clearer or by a notice through the intermediary of the Clearer or (ii) published
in one or more financial daily newspapers having general circulation in
Belgium (which is expected to be “L’Echo” and/or “De Tijd”).
All notices shall be made in writing or by facsimile. Each notice shall be made
to the relevant party at the address or facsimile number as set out herein.
A notice shall be deemed received (if in writing) when delivered and (if by
facsimile) when despatched. Any notice by telephone, if any, shall be
promptly confirmed in writing.
Notices to the Issuer or to the Domiciliary Agent will be made to their
respective offices by mail or telefax and addressed for the attention of or the
person designated by that party for that purpose as set out below:
14Issuer :
Bank J.Van Breda & C° N.V.
Plantin en Moretuslei 295
2140 Antwerp
Belgium
From 2007: Ledeganckkaai 7, 2000 Antwerp
Contact :
Boekhouding Back Office
Fax: +32 3 271 04 10
Tel: +32 3 217 52 31
Domiciliary Agent :
KBC Bank NV
Havenlaan 12
1080 Brussels
Belgium
Tel : +32 2 429 43 42
Fax : +32 2 429 52 73
Contact : Back Office
Inquiries : Any information regarding the Programme may be obtained from the Dealers:
KBC Bank NV
Havenlaan 12
1080 Brussels
Belgium
Tel : +32 2 417 43 13
Fax : +32 2 429 57 05
Contact : Institutional Sales Department
Bank J Van Breda & C° N.V.
Plantin en Moretuslei 295
2140 Antwerp
Belgium
From 2007: Ledeganckkaai 7, 2000 Antwerp
Contact :
Fax: +32 3 236 59 26
Mr. Handstanger: Tel.: +32 3 270 92 05
Mr. Mondy: Tel.: +32 3 270 92 07
15III. SELLING RESTRICTIONS
The offering for sale of Certificates of Deposit may, in jurisdictions other than Belgium, be restricted by
law. Potential investors shall be responsible for complying with applicable legislation in said other
jurisdictions. In particular, they shall comply with the restrictions involving the United States of America
and the United Kingdom, as set out hereunder.
(a) The United States of America
The Certificates of Deposit have not been and shall not be registered under the U.S. Securities
Act of 1933 and may not be offered, sold or delivered within the United States or to U.S.
persons except pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the said Securities Act.
(b) The United Kingdom
Certificates of Deposit may not be offered or sold, prior to the expiry of the period of six months
from the issue date of the Certificates of Deposit, to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or otherwise in
circumstances which have not resulted and will not result in an offer to the public in the United
Kingdom within the meaning of the Public Offers of Securities Regulations 1995, and subject to
compliance with all applicable provisions of the Financial Services and Markets Act 2000 (the
"FSMA") with respect to anything done in relation to the Certificates of Deposit in, from or
otherwise involving the United Kingdom. Any information likely to lead to the purchase of
Certificates of Deposit may only be or caused to be communicated as an invitation or
inducement to engage in investment activity (within the meaning of section 21 of the FSMA) in
connection with the issue or sale of any Certificates of Deposit in circumstances in which
section 21(1) of the FSMA does not apply to the Issuer.
16IV. PRESENTATION OF BANK J.VAN BREDA & C° N.V.
1. Brief business description
Bank J.Van Breda & C° is not a bank for everyone. On the contrary, our main asset is our in-
depth specialisation. We aim to be the best advisory bank for entrepreneurs and the liberal
professions, providing lifelong service for both private and professional needs. This is the
focus of our entire organisation. We operate on the basis of our own unique approach,
constantly keeping our clients' long-term interests in mind. We guarantee a personal service
for the systematic accumulation and protection of our client’s assets.
As a financial advisor, we stand out ever more clearly because of three crucial strengths.
We are
1. Specialized : Because we do nothing else besides dealing with our target clients, we
are thoroughly familiar with the needs and concerns of businesses and the liberal
professions. We keep an eye on the financial balance between their business, their
practice or their firm on the one hand and their private capital accumulation on the
other. This means that we can make the difference at crucial points in their career.
2. Prompt : Thanks to our short communication lines, our customers will receive a
prompt answer to their questions. Without delay or needless rigmarole and
bureaucracy. When necessary, we take the initiative ourselves. Proactively.
3. Personal : Our clients have a permanent customer relations manager. Our small
scale means that he or she can also guarantee them a really personal approach. Our
staff are trained to listen first and only then to give advice
To fulfil these promises, a unique team stands ready to serve the clients. The staff members
who look after their affairs at Bank J.Van Breda & C° set great store by the following values:
1. Honesty : We work exclusively with people of integrity who seek to live and work
ethically both in their private and in their professional lives.
2. Enthusiasm : You can feel the difference from the very first contact: here is a team
ready to serve the customer that combines professionalism with a positive attitude.
3. Sense of responsibility : If one of our staff members gives a piece of advice, they
take into consideration the long-term needs of the client. They make specific
arrangements with them and they honour those commitments. That requires no
specific request but is our fundamental approach
Our results show that our clients appreciate this approach. Bank J.Van Breda & C° has been
a profitable niche player for many years. In 2005, we published a growth in profits for the
tenth year in succession.
Profit is essential for the future of all businesses. But there is more. The success of our
deliberate focus also increases our colleagues' pride in their profession. We feel at home in
the world of SMEs. Our heart beats for the medical sector. The feeling of doing meaningful
work for interesting clients, in a company where people feel comfortable: this is what
motivates us. And we try to pass on this positive feeling to the client.
172. Organisation and shareholders
2.1 Organisation chart
Bank J.Van Breda & C° is a specialised bank that focuses specifically on businesses and the
liberal professions, covering both professional and private needs throughout their lifetime. The
bank was founded in Lier in 1930 by Jos Van Breda and has maintained its individuality ever
since. It is making every effort to retain its independence in the future.
2.1.1 Finaxis
Since 1998, the bank's shares have been established in the Finaxis holding company, along
with those of Bank Delen, the largest independent asset manager in Flanders. Thanks to
close cooperation, Bank J.Van Breda & C° also offers its clients the professional services of
this renowned bank. Ackermans & van Haaren, the reference shareholder, now owns 75% of
the shares in Finaxis. The Delen family holds 25% of the capital through the company
Promofi.
2.1.2 Ackermans & van Haaren
Ackermans & van Haaren is a diversified group listed on the Brussels Stock Exchange.
Market capitalisation of approximately EUR 1,7 billion. Ackermans & van Haaren aims for a
balanced even spread of its activities over 3 core sectors:
- Contracting sector: based on D.E.M.E. (dredging and maritime works) and Van Laere
(civil engineering)
- Financial services: based on Finaxis (with Bank Delen and Bank J.Van Breda & C°)
and Leasinvest (real estate)
- Development capital: based on Sofinim
More information: www.avh.be
2.1.3 Bank Delen
The Delen group, originally a stockbroker established in 1936, is now active via Bank Delen
as an asset manager. In its offices in Antwerp, Brussels, Liège, Rumbeke (Roeselare) and
branches in Luxembourg and Geneva, the bank has 168 employees. Since being
incorporated in the Ackermans & van Haaren Group in 1992, it has achieved strong growth
year by year. Since 1998 Bank Delen has worked closely with Bank J.Van Breda & C° to
serve their respective customers. It manages assets worth EUR 9,2 billion. Bank Delen is the
largest asset manager in Flanders.
More information: www.delen.be
183. 2005: profit growth for the tenth year in succession
As of the 2005 financial year, Bank J.Van Breda & C° is reporting its annual accounts in line
with the International Financial Reporting Standards (IFRS), including a comparison with
2004. Please note: all comparisons with the previous financial year are based on pro forma
IFRS figures for 2004. In 2005 Bank J.Van Breda & C° posted a record result, with a
consolidated operating net profit of EUR 28,811 million - representing a growth of 18% over
2004. The sale of its subsidiary, Leasing J.Van Breda & C°, realised a profit of EUR 22,633
million, bringing the consolidated net profit to EUR 51,444 million.
- Total assets invested by clients rose sharply by 13% to more than EUR 3,5
billion. The credit volume from target group banking rose by 20% to EUR 1,4
billion.
- The overall income grew by 7,8%. Costs increased by only 3%. Write-downs on
the credit portfolio fell to the exceptionally low level of EUR 1,7 million.
- This resulted in a net operational profit after taxes of EUR 28,811 million, up
18% compared to 2004.
- Total equity grew by EUR 35,9 million to a total of EUR 237 million.
- The cost / income ratio fell to 51% (54% in 2004), which seems this year again
to be structurally lower than the average for the Belgian banking sector.
- The net return on average equity was 13,2%.
Net profit after taxes
193.1 Niche strategy
The niche strategy whereby Bank J.Van Breda & C° focuses specifically on entrepreneurs
and the liberal professions is confirming its success. The many entrepreneurs and
professionals who have become clients in the past few years are entrusting an increasing
share of their banking needs to us. Moreover, the number of target group clients who are
entrepreneurs and professionals continues to grow (+3,5% in 2005).
The confidence that entrepreneurs and professionals show in Bank J.Van Breda & C°, in both
private and professional matters, is evident from the growth in the various product groups.
For the second year in a row, Bank J.Van Breda & C° has realised a growth of 20% in the
credit volume of target group banking, bringing it up to EUR 1,4 billion.
The assets invested by clients rose by a record amount of EUR 420 million in 2005 (+13%)
to a total of EUR 3.538 million. Our clients have continued steadily to build up their assets
through our bank.
- Our clients' deposits remained essentially unchanged at EUR 1.467 million.
- The margins on deposits, which had followed a sharp downward trend since
the year 2000, recovered slightly in 2005.
- The volume of off-balance sheet investments rose very sharply by over 25%
to EUR 2.071 million.
3.2 Commission income rises by 21 %
The volumes of assets managed grew by 27% in 2005. Bank Delen now manages EUR
1.038 million for clients of Bank J.Van Breda & C° (EUR 814 million in 2004). There was a
steady influx of new capital, both from existing and from new clients.
Strong growth was also experienced in investment funds, up to an invested capital of EUR
237 million (EUR 191 million in 2004). The favourable stock market conditions encouraged
customers to invest more in shares.
At the same time, insurance investment funds were once again on the rise, growing by 4%
to a volume of EUR 739 million.
Other insurance products (mainly group insurance) once again generated more than 1
million in revenues from fees. The outstanding reserves rose by the end of the financial year
by 23%, to EUR 55 million.
20In sum, the volume of all these off-balance sheet investments together rose very sharply.
Since management and entrance fees are under pressure, the 21% growth in revenues from
fees lags slightly behind the growth in volume by over 25%.
Bank J.Van Breda & C° is becoming increasingly well known as a specialist bank for
entrepreneurs and the liberal professions. In addition, we also provide financing for
passenger vehicles through our subsidiary, Van Breda Car Finance. The subsidiary
Leasing J. Van Breda & C° was sold in 2005 to BNP Paribas Lease Group (BPLG).
3.3 Van Breda Car Finance
Van Breda Car Finance, a wholly owned subsidiary of Bank J.Van Breda & C°, operates
throughout Belgium in the car financing and car leasing sector. It aims to be the credit
company for customers of large, independent car dealers.
The entire organisation focuses on providing rapid credit solutions for passenger vehicles via
the company's own website. This website assists our partners, the local car dealers,
throughout the sales process, from drawing up the quotation, processing the application and
preparing the credit contracts, to monitoring payments on the dossier. In this way we make it
easier for our partners to make sales, as they can extend their customer service to include
credit.
At the end of 2005 the total portfolio amounted to EUR 241 million, up 3,6%.
Thanks to strict cost control and ongoing risk management, the result was again up in 2005.
3.4 Leasing J. Van Breda & C° sold to BPLG
Leasing J.Van Breda & C°, until recently a wholly owned subsidiary of Bank J.Van Breda &
C°, specialises in "small ticket vendor leases" (leasing for amounts less than EUR 250.000 to
professionals). Via the Internet, it offers quick leasing solutions to vendors of office
equipment, IT, telecommunications and medical equipment. With a market share of 22%,
Leasing J.Van Breda & C° is the market leader in this niche in Belgium. The company
managed a portfolio of EUR 233 million as at 30/09/2005, with 28.000 contracts.
On 30 September 2005 Bank J.Van Breda & C° and BNP Paribas Lease Group announced
that they had signed an agreement regarding the takeover of Leasing J.Van Breda & C° by
BNP Paribas Lease Group (BPLG). The effective transfer of the shares took place on 13
October 2005. The decision to sell Leasing J.Van Breda & C° was in line with the vision of
Bank J.Van Breda & C°, which involved anchoring Leasing J.Van Breda & C° in an
international group that offers future prospects to both its clients and its employees. BPLG is
the European market leader in leasing technological equipment, and manages a portfolio of c.
EUR 16 billion. Upon the sale of the shares in Leasing J.Van Breda & C° NV, the Bank J.Van
Breda & C° realised a capital gain of EUR 22,6 million.
3.5 Targeted Personnel Policy
In order to be the best advisory bank for entrepreneurs and the liberal professions, we pay a
great deal of attention to our personnel policy. This begins with the recruitment of highly
qualified staff. 75% of our employees have a diploma of higher education.
At the end of 2005, the bank employed a total of 380 staff. We looked after relations with our
clients from 43 locations, including 11 independent branches. The network as a whole now
comprises over 100 customer relations managers. By comparison, in 1999 there were barely
60.
Our client-oriented approach is reflected in a strong commercial complement. In 2005, the
percentage of staff in direct contact with clients remained high at 61% (expressed in full-time
equivalents). This is combined with substantial and ongoing training Programmes. We believe
it is important for people to integrate quickly and fully into our corporate culture.
21Ensuring that clients are firmly established and staff loyalty go hand in hand. This is why
Bank J.Van Breda & C° adopts a social policy focusing on staff retention. A results-oriented
approach to work and participation in profit growth are supported by means of a broad-based
share option plan. Open communication, mutual commitment and job satisfaction are central
to our corporate mission.
3.6 Commercial IT Policy
In 2005 the bank worked on the streamlining and further automation of our credit process for
target group clients, as well as on the further extension of our customer management
systems. This will enable us to better organise our client follow-up and advisory services.
Further investment in this area is planned in 2006.
The bank's Programme for 2006 also includes further improvements to
www.vanbredaonline.be. This interactive application for electronic banking via the Internet will
offer clients an overview of their asset accumulation with our bank. We are also planning
substantial investments in further streamlining our credit process for target group clients.
The extranet application www.vanbredavendor.com has played an important role in the
corporate process at Van Breda Car Finance for a number of years now.
3.7 Positive long-term outlook
2005 was the tenth year in a row where we have seen profits increase. In the last two years
we achieved outstanding growth for our bank: +25% in 2004 and +18% in 2005. Write-downs
on the credit portfolio were at a very low rate for two years in a row. The EUR 2,3 million
capital gain realised through early repayment of the credit extended to the former subsidiary
Leasing J.Van Breda & C° has likewise been exceptional in nature. These exceptional
elements make the management's goal to see further growth in operating profits in 2006
highly ambitious.
At the consolidated level, the operational contribution of Leasing J.Van Breda & C° is of
course no longer present. Therefore it seems unlikely that 2006 will see an increase in profits
for the 11th year running.
However, we have sufficient confidence in the long-term potential of our strategy. Moreover,
over the past few years we have made substantial investments in order to increase the
number of customer relations managers on the one hand, and in supporting IT systems and
the upgrading of our commercial offices on the other. We are convinced that these efforts will
yield a return and be reflected in continued profit growth in the medium and long term.
223.8 Risk management
Business risks are an inherent part of the normal activities of a bank. In comparison with other
colleagues in the sector, however, Bank J.Van Breda & C° is not a highly complex institution.
Nevertheless, the bank displays great caution when accepting risks. It undertakes constant
risk follow-up and monitoring. Historically, Bank J.Van Breda & C° has amply demonstrated
its capacity to manage risks.
Credit risk
Our credit portfolio is very widely spread within the local economic fabric of family businesses
and the liberal professions. To this end, the bank applies concentration limits per sector and
maximum credit amounts per client. The credit portfolio is divided into five risk categories,
each of which receives a specific follow-up. For the credits in the highest risk category,
"uncertain proceeding", reporting takes place twice a year. Doubtful debts are transferred to
the legal department. There are specific criteria for mandatory transfer in particular cases that
may arise with our clients, borrowers or guarantors. For credits in the highest risk category
and on debts that become doubtful, write-downs are entered.
Market and interest rate risk
As all our business is client-oriented, our result is less sensitive to developments on the
financial markets.
- The bank itself does not hold any currency positions. Given the nature of the clients,
trading activities and the related risks are kept to an absolute minimum.
- The bank does not own any shares in its own portfolio. Long-term investments involve
virtually exclusively government bonds.
- The bank adopts a cautious policy regarding the interest rate risk, well within the
standards set by the CBFA (Bank, Finance and Insurance Commission). In areas
where the durations of assets and liabilities do not match sufficiently, we introduce
hedging instruments to correct the balance. We do this with a combination of rate
swaps (that convert our variable interest rate commitments into fixed commitments)
and options (which provide protection against a rise in interest rates above given
levels).
Liquidity risk
The bank's liquidity risk is monitored constantly by means of pro-active treasury management,
within the lines defined by Asset & Liability Management.
Operational risk
As a specialised niche player, Bank J.Van Breda & C° benefits from its relatively small scale,
flat structure and short lines of communication. The internal operational risks are managed,
amongst other things, through
- High standards of integrity: honesty is of fundamental importance in the corporate
culture, both for the organisation and for individual members of staff
- Departmental charters: the core values 'specialised', 'prompt' and 'personal' are
guaranteed at department level by means of departmental charters
- Front-line control: the operational departments have a major responsibility in
monitoring their own operating methods and the quality provided
- IT: the main operating processes are computerised and have built-in process controls
- Disaster recovery plan: the continuity of activities should there occur an interruption in
IT services, is regularly tested and improved
23- Business continuity plan: in anticipation of the planned move to our new head office in
Antwerp South, an adjusted business continuity plan will be worked out in the course
of 2006.
Reputation risk
Bank J.Van Breda & C° has an impeccable reputation which it wishes to guarantee. Constant
attention to integrity and discretion form the guiding thread running through all our activities.
We advocate caution and balance for our clients as well. This is reflected amongst other
things in nuanced investment advice (with a view to spread, long-term planning and
investment in quality securities), thorough advice on all credit applications (with the emphasis
on the quality of the business plan, the reimbursement capacity and equity) and high
standards in terms of advising and acting correctly from a legal and tax point of view.
Strategic risk
The activities of Bank J.Van Breda & C° are constantly guided and undertaken in accordance
with the corporate mission. This corporate mission has for years formed the basis of the
bank's positive results. The Executive Committee consistently tests all strategic decisions and
market opportunities against the corporate mission.
The Board of Directors also constantly assesses this mission on its merits and regularly tests
future opportunities and threats for the bank in a rapidly changing market environment.
Income volatility risk
The income from customer relations banking - the bank's main activity - is supplemented by
the subsidiary Van Breda Car Finance. The complementary nature of the two activities
ensures a spread in our income.
Solvency risk
The bank has adequate equity and substantial self-financing capacity. The risk asset ratio
amounted to 14,4% in 2005, whereas the minimum requirement is 8%. The ratio based on net
worth in the narrow sense (Tier 1) rose to 10%. This is sufficient to enable further growth on
our own, even in difficult market circumstances or in the event of unforeseen setbacks.
Autonomy of internal audit and risk policy
With a view to strict control of all operating risks, great value is attached to the autonomy of
the internal audit unit, the compliance officer, the risk manager and the ombudsman. The
autonomy of the internal auditor is guaranteed by means of the Finaxis Audit Committee.
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