OVERSEA-CHINESE BANKING CORPORATION LIMITED - Finanznachrichten
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Exchange Offer Memorandum dated 6 March 2009
OVERSEA-CHINESE BANKING CORPORATION LIMITED
(Incorporated in Singapore)
(Company Registration No. 193200032W)
Offer to Exchange Any and All Outstanding 5.00% Subordinated Notes due 2011 for
5.60% Subordinated Notes due 2019 Callable with Step-up in 2014
Oversea-Chinese Banking Corporation Limited (“OCBC Bank”, the “Bank” or the “Issuer”) hereby offers to exchange
any and all of its outstanding 5.00% Subordinated Notes due 2011 (the “Existing Notes”) for 5.60% Subordinated
Notes due 2019 Callable with Step-up in 2014 (the “Notes”), subject to the terms and conditions set forth in this
Exchange Offer Memorandum (the “Exchange Offer Memorandum”). The offer to exchange the Existing Notes for
the Notes and the offer of additional Notes to holders of Existing Notes (“Holders”) is referred to as the “Exchange
Offer”.
The Exchange Offer will commence at 9:00 a.m., Singapore time, on 6 March 2009 (the “Commencement
Date”) and the Exchange Offer will close at 12:00 noon, Singapore time, on 23 March 2009, unless extended
or terminated (such date and time, the “Closing Date”). Holders who wish to accept the Exchange Offer must
validly tender their Existing Notes on or prior to 12:00 noon, Singapore time, on
23 March 2009 through The Central Depository (Pte) Limited (“CDP”). Except as otherwise provided in this
Exchange Offer Memorandum (please refer to “The Terms of the Exchange Offer - Withdrawal of Tenders of
Existing Notes and Applications for Additional Notes”), tenders of Existing Notes and applications for
additional Notes are irrevocable and may not be withdrawn.
Holders shall receive Notes in the same principal amount of Existing Notes validly tendered pursuant to the
Exchange Offer, plus accrued and unpaid interest on the principal amount in respect of the validly tendered Existing
Notes to, but not including, the Settlement Date (as defined herein).
Holders who elect to exchange their Existing Notes in full for Notes may also elect to apply for additional Notes in
denominations of S$1,000 principal amount and integral multiples thereof such that the aggregate principal amount of
Notes to be held by a Holder is rounded up to the nearest multiple of S$250,000. The Bank has the sole discretion to
allocate the additional Notes and intends as far as practicable to allocate additional Notes for rounding up purposes
only.
Holders may request copies of this Exchange Offer Memorandum or the Form of Acceptance and Authorisation
(“FAA”) from CDP at the address set forth herein during normal business hours up to 12:00 noon on the Closing
Date.
Approval in-principle has been received to list the Notes on the Singapore Exchange Securities Trading Limited (the
“SGX-ST”). The SGX-ST assumes no responsibility for the correctness of any of the statements made or opinions or
reports contained in this Exchange Offer Memorandum. Admission of the Notes to the Official List of the SGX-ST is
not to be taken as an indication of the merits of the Bank or the Notes.
The Notes are rated Aa2 by Moody’s Investors Services (“Moody’s”), A+ by Fitch Ratings Ltd. (“Fitch”) and A by
Standard & Poor’s Rating Service (“S&P”).
NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OR TO ANY U.S.
PERSON.
THE EXCHANGE OFFER IS NOT BEING MADE TO (NOR WILL THE TENDER OF EXISTING NOTES BE
ACCEPTED FROM OR ON BEHALF OF) HOLDERS OF EXISTING NOTES IN THE UNITED STATES OR IN ANY
OTHER JURISDICTION WHERE THE MAKING OR ACCEPTANCE OF THE EXCHANGE OFFER WOULD NOT
COMPLY WITH THE LAWS OF THAT JURISDICTION. HOWEVER, THE BANK MAY, IN ITS SOLE DISCRETION,
TAKE SUCH ACTIONS AS IT MAY DEEM NECESSARY TO OFFER TO EXCHANGE EXISTING NOTES IN ANY
JURISDICTION AND MAY EXTEND THE EXCHANGE OFFER TO, AND EXCHANGE EXISTING NOTES WITH,
PERSONS IN ANY SUCH JURISDICTION.
NONE OF THIS EXCHANGE OFFER MEMORANDUM OR ANY RELATED DOCUMENT HAS BEEN FILED WITH
THE U.S. SECURITIES AND EXCHANGE COMMISSION, NOR HAS ANY SUCH DOCUMENT BEEN FILED WITH
OR REVIEWED BY ANY U.S. FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY
OF ANY COUNTRY. NO AUTHORITY HAS PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
EXCHANGE OFFER MEMORANDUM OR ANY RELATED DOCUMENTS, AND IT IS UNLAWFUL AND A CRIMINAL
OFFENCE TO MAKE ANY REPRESENTATION TO THE CONTRARY.
Lead Manager
Oversea-Chinese Banking Corporation LimitedNEITHER THE BANK NOR CDP MAKES ANY RECOMMENDATION AS TO WHETHER OR NOT HOLDERS SHOULD TENDER EXISTING NOTES IN RESPONSE TO THE EXCHANGE OFFER AND, IF GIVEN OR MADE, ANY SUCH RECOMMENDATION MAY NOT BE RELIED UPON AS AUTHORISED BY THE BANK OR CDP. EACH HOLDER MUST MAKE HIS, HER OR ITS OWN DECISION AS TO WHETHER TO TENDER EXISTING NOTES IN CONNECTION WITH THE EXCHANGE OFFER AND, IF SO, AS TO HOW MANY EXISTING NOTES TO TENDER. IF YOU ARE IN ANY DOUBT AS TO THE ACTION THAT YOU SHOULD TAKE, YOU SHOULD CONSULT YOUR STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR OTHER PROFESSIONAL ADVISER IMMEDIATELY. THE EXCHANGE OFFER OF NOTES BY THE BANK IS MADE ONLY TO AND DIRECTED AT, AND THE NOTES ARE ONLY AVAILABLE TO, PERSONS IN SINGAPORE AND HONG KONG WHO ARE EXISTING HOLDERS OF EXISTING NOTES PREVIOUSLY ISSUED BY THE BANK. THIS EXCHANGE OFFER MEMORANDUM HAS NOT BEEN REGISTERED AS A PROSPECTUS WITH THE MONETARY AUTHORITY OF SINGAPORE. ACCORDINGLY, THIS EXCHANGE OFFER MEMORANDUM AND ANY OTHER DOCUMENT OR MATERIAL IN CONNECTION WITH THE EXCHANGE OFFER OR SALE, OR INVITATION FOR SUBSCRIPTION OR PURCHASE, OF THE NOTES MAY NOT BE CIRCULATED OR DISTRIBUTED, NOR MAY THE NOTES BE OFFERED OR SOLD, OR BE MADE THE SUBJECT OF AN INVITATION FOR SUBSCRIPTION OR PURCHASE, WHETHER DIRECTLY OR INDIRECTLY, TO PERSONS IN SINGAPORE OTHER THAN (I) TO EXISTING HOLDERS OF EXISTING NOTES PURSUANT TO SECTION 273(1)(CE) OF THE SECURITIES AND FUTURES ACT, CHAPTER 289 OF SINGAPORE (THE “SFA”) AND/OR SECTION 273(1)(CF) OF THE SFA OR (II) PURSUANT TO, AND IN ACCORDANCE WITH, THE CONDITIONS OF AN EXEMPTION UNDER ANY PROVISION OF SUBDIVISION (4) OF DIVISION 1 OF PART XIII OF THE SFA. THE EXCHANGE OFFER IS NOT BEING MADE, AND WILL NOT BE MADE, DIRECTLY OR INDIRECTLY, IN OR INTO, OR BY USE OF THE MAIL OF, OR BY ANY MEANS OR INSTRUMENTALITY OF INTERSTATE OR FOREIGN COMMERCE OF, OR OF ANY FACILITIES OF A NATIONAL SECURITIES EXCHANGE OF, THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, AS DEFINED IN REGULATION S UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS INCLUDES, BUT IS NOT LIMITED TO, FACSIMILE TRANSMISSION, ELECTRONIC MAIL, TELEX, TELEPHONE AND THE INTERNET. ACCORDINGLY, COPIES OF THIS EXCHANGE OFFER MEMORANDUM AND ANY OTHER DOCUMENTS OR MATERIALS RELATING TO THE EXCHANGE OFFER ARE NOT BEING, AND MUST NOT BE, DIRECTLY OR INDIRECTLY, MAILED OR OTHERWISE TRANSMITTED OR DISTRIBUTED IN OR INTO THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS. ANY PURPORTED OFFERS TO EXCHANGE EXISTING NOTES PURSUANT TO THE EXCHANGE OFFER RESULTING DIRECTLY OR INDIRECTLY FROM A VIOLATION OF THESE RESTRICTIONS WILL BE INVALID, AND OFFERS TO EXCHANGE MADE BY A RESIDENT OF THE UNITED STATES OR FROM U.S. PERSONS OR ANY AGENT, FIDUCIARY OR OTHER INTERMEDIARY ACTING ON A NON-DISCRETIONARY BASIS FOR A PRINCIPAL GIVING INSTRUCTIONS FROM WITHIN THE UNITED STATES OR FOR U.S. PERSONS WILL NOT BE ACCEPTED. THE EXCHANGE OFFER IS NOT BEING MADE IN THE UNITED STATES. THE DISTRIBUTION OF THIS EXCHANGE OFFER MEMORANDUM IN THE UNITED STATES AND HONG KONG IS RESTRICTED BY THE LAWS OF THOSE JURISDICTIONS. NO ACTION HAS BEEN OR WILL BE TAKEN IN ANY JURISDICTION IN RELATION TO THE EXCHANGE OFFER THAT WOULD PERMIT A PUBLIC OFFERING OF SECURITIES. NO PROSPECTUS REGARDING THE OFFER OF NOTES HAS BEEN DRAWN-UP AND APPROVED BY THE COMMISSION DE SURVEILLANCE DU SECTEUR FINANCIER OR VALIDLY PASSPORTED INTO LUXEMBOURG PURSUANT TO THE LUXEMBOURG LAW ON PROSPECTUSES FOR SECURITIES DATED 10 JULY 2005. THE OFFER TO EXCHANGE THE EXISTING NOTES FOR THE NOTES AND THE OFFER OF ADDITIONAL NOTES IS NOT BEING MADE TO (NOR WILL THE TENDER OF EXISTING NOTES BE ACCEPTED FROM OR ON BEHALF OF) HOLDERS OF EXISTING NOTES IN LUXEMBOURG OR MORE GENERALLY IN ANY OTHER MEMBER STATE OF THE EUROPEAN ECONOMIC AREA. ANY DISSEMINATION OF THIS EXCHANGE OFFER MEMORANDUM IN LUXEMBOURG OR MORE GENERALLY IN ANY OTHER MEMBER STATE OF THE EUROPEAN ECONOMIC AREA WILL BE SOLELY TO COMPLY WITH THE REQUIREMENTS OF ARTICLE 20 OF THE LAW OF 11 JANUARY 2008 ON THE TRANSPARENCY REQUIREMENTS IN RELATION TO INFORMATION ABOUT ISSUERS WHOSE SECURITIES ARE ADMITTED TO TRADING ON A REGULATED MARKET (THE “TRANSPARENCY LAW”) AND ARTICLE 13 OF THE GRAND-DUCAL REGULATION DATED 11 JANUARY 2008 RELATING TO TRANSPARENCY REQUIREMENTS, IMPLEMENTING THE TRANSPARENCY LAW AND WILL NOT CONSTITUTE AN OFFER OF NOTES OR A MAKING OF THE EXCHANGE OFFER IN THESE JURISDICTIONS.
TABLE OF CONTENTS
CONTENTS PAGE
OFFER RESTRICTIONS.................................................................................................................... 2
IMPORTANT INFORMATION ............................................................................................................ 4
FORWARD-LOOKING STATEMENTS .............................................................................................. 5
INDICATIVE OFFER TIMETABLE ...................................................................................................... 6
SUMMARY OF THE EXCHANGE OFFER ........................................................................................ 7
SUMMARY OF THE NOTES.............................................................................................................. 10
CERTAIN DIFFERENCES BETWEEN THE NOTES AND THE EXISTING NOTES ........................ 14
CERTAIN SIGNIFICANT CONSIDERATIONS .................................................................................. 15
DESCRIPTION OF OCBC BANK ...................................................................................................... 19
CAPITALISATION .............................................................................................................................. 20
SELECTED FINANCIAL INFORMATION .......................................................................................... 22
USE OF PROCEEDS ........................................................................................................................ 24
THE TERMS OF THE EXCHANGE OFFER ...................................................................................... 25
SUMMARY OF PROVISIONS RELATING TO THE NOTES WHILE IN GLOBAL FORM .................. 30
CLEARING AND SETTLEMENT........................................................................................................ 32
SINGAPORE TAXATION .................................................................................................................... 33
MISCELLANEOUS ............................................................................................................................ 37
GENERAL INFORMATION IN RELATION TO THE NOTES .............................................................. 38
APPENDIX 1 – PROCEDURES FOR ACCEPTANCE OF THE EXCHANGE OFFER AND
APPLICATION FOR ADDITIONAL NOTES ............................................................ 39
APPENDIX 2 – TERMS AND CONDITIONS OF THE NOTES ...................................................... 43
APPENDIX 3 – FREQUENTLY ASKED QUESTIONS .................................................................... 55
1OFFER RESTRICTIONS
The Exchange Offer does not constitute an offer to buy or exchange or the solicitation of an offer to sell
or exchange the Existing Notes, or an offer to sell or the solicitation of an offer to buy the Notes, in any
circumstances in which such offer or solicitation is unlawful. In those jurisdictions where the securities,
blue sky or other laws require the Exchange Offer to be made by a licensed broker or dealer, the
Exchange Offer shall be deemed to be made on behalf of the Bank by one or more registered brokers or
dealers licensed under the laws of such jurisdiction. Neither the delivery of this Exchange Offer
Memorandum nor any exchange of Existing Notes shall under any circumstances create any implication
that the information contained herein or incorporated herein by reference is correct as of any time
subsequent to the date hereof, or that there has been no change in the information set forth herein or
incorporated herein by reference or in any attachments hereto or in the affairs of the Bank or any of its
affiliates since the date hereof.
This Exchange Offer Memorandum has not been registered as a prospectus with the Monetary
Authority of Singapore. Accordingly, this Exchange Offer Memorandum and any other document
or material in connection with the offer or sale, or invitation for subscription or purchase, of the
Notes may not be circulated or distributed, nor may the Notes be offered or sold, or be made the
subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in
Singapore other than (i) to existing holders of Existing Notes pursuant to Section 273(1)(ce) of the
SFA and/or Section 273(1)(cf) of the SFA or (ii) pursuant to, and in accordance with, the conditions
of an exemption under any provision of Subdivision (4) of Division 1 of Part XIII of the SFA.
The Notes have not been offered or sold and will not be offered or sold in Hong Kong, by means
of any document, other than (a) to “professional investors” as defined in the Securities and
Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that Ordinance; or (b) in
other circumstances which do not result in the document being a “prospectus” as defined in the
Companies Ordinance (Cap. 32) of Hong Kong or which do not constitute an offer to the public
within the meaning of that Ordinance. No advertisement, invitation or document relating to the
Notes (including this Exchange Offer Memorandum) has been issued or been in the possession of
the Bank for the purposes of issue, and will not be issued or be in the possession of the Bank for
the purposes of issue, whether in Hong Kong or elsewhere, any advertisement, invitation or
document relating to the Notes, which is directed at, or the contents of which are likely to be
accessed or read by, the public of Hong Kong (except if permitted to do so under the securities
laws of Hong Kong) other than with respect to Notes which are or are intended to be disposed of
only to persons outside Hong Kong or only to “professional investors” as defined in the Securities
and Futures Ordinance and any rules made under that Ordinance.
The Exchange Offer is not being made, and will not be made, directly or indirectly, in or into, or by
use of the mail of, or by any means or instrumentality of interstate or foreign commerce of or of
any facilities of a national securities exchange of, the United States or to, or for the account or
benefit of, U.S. persons (as defined in Regulation S under the Securities Act). This restriction
includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone and the
internet. Accordingly, copies of this Exchange Offer Memorandum and any other documents or
materials relating to the Exchange Offer are not being, and must not be, directly or indirectly,
mailed or otherwise transmitted, distributed or forwarded in or into the United States or to U.S.
persons, and the Exchange Offer cannot be accepted by any such use, means, instruments or
facilities or from within the United States or by U.S. persons. Any purported offer to exchange
Existing Notes resulting directly or indirectly from a violation of these restrictions will be invalid,
and any tenders of Notes or any purported offer to exchange made by a resident of the United
States or from the United States or any agent, fiduciary or other intermediary acting on a non-
discretionary basis for a principal giving instructions from within the United States or for a U.S.
person will be invalid and will not be accepted.
2This Exchange Offer Memorandum is not an offer of securities for sale in the United States or to
U.S. persons. The Existing Notes and the Notes have not been, and will not be, registered under
the Securities Act or the securities laws of any state or jurisdiction of the United States, and may
not be offered, sold or delivered, directly or indirectly, in the United States or to, or for the account
or benefit of, U.S. persons, except pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act. Accordingly, the Notes are being offered
and sold only outside the United States in reliance on Regulation S under the Securities Act. The
purpose of this Exchange Offer Memorandum is limited to the Exchange Offer, and this Exchange
Offer Memorandum may not be sent or given other than in an offshore transaction in accordance
with Regulation S under the Securities Act. Each Holder of Existing Notes participating in the
Exchange Offer will represent that it is offering its Existing Notes in an offshore transaction in
accordance with Regulation S under the Securities Act and that it is not a U.S. person or an agent,
fiduciary or other intermediary acting on a non-discretionary basis for a principal giving
instructions from within the United States or for a U.S. person.
No prospectus regarding the offer of notes has been drawn-up and approved by the Commission
de Surveillance du Secteur Financier or validly passported into Luxembourg pursuant to the
Luxembourg Law on Prospectuses for Securities dated 10 July 2005.
The offer to exchange the Existing Notes for the Notes and the offer of additional Notes is not
being made to (nor will the tender of Existing Notes be accepted from or on behalf of) holders of
Existing Notes in Luxembourg or more generally in any other member state of the European
Economic Area.
Any dissemination of this Exchange Offer Memorandum in Luxembourg or more generally in any
other member state of the European Economic Area will be solely to comply with the
requirements of article 20 of the law of 11 January 2008 on the Transparency Law and article 13 of
the Grand-ducal regulation dated 11 January 2008 relating to transparency requirements,
implementing the Transparency Law and will not constitute an offer of Notes or a making of the
Exchange Offer in these jurisdictions.
The distribution of this Exchange Offer Memorandum in certain jurisdictions may be restricted by law.
Persons into whose possession this Exchange Offer Memorandum comes are required by the Bank to
inform themselves about and to observe any such restrictions.
3IMPORTANT INFORMATION
Any Holder who wishes to tender Existing Notes and (if applicable) apply for additional Notes to round up
the principal amount of the Notes to be held to the nearest multiple of S$250,000, in connection with the
Exchange Offer should:
in the case of a Holder who holds Existing Notes in a direct account with CDP or is a depository
agent (“DA”) of CDP, follow the procedures set forth under “Appendix 1 – Procedures for
Acceptance of the Exchange Offer and Application for Additional Notes”; or
in the case of a beneficial owner whose Existing Notes are held by a broker, dealer, commercial
bank or other person who is a DA, contact such DA.
A Holder (other than a DA) may apply for additional Notes only if such Holder elects to exchange
its Existing Notes in full for Notes. A DA may apply for additional Notes in respect of a sub-
account only if all Existing Notes held in that sub-account are tendered in exchange for Notes.
No guaranteed delivery procedures will be available for tendering Existing Notes in the Exchange
Offer.
No dealer, salesperson or other person has been authorised to give any information or to make any
representation not contained in this Exchange Offer Memorandum and, if given or made, a Holder may
not rely on that information or representation as having been authorised by the Bank or any of its
affiliates.
THIS EXCHANGE OFFER MEMORANDUM CONTAINS OR REFERS TO IMPORTANT INFORMATION
THAT YOU SHOULD READ CAREFULLY BEFORE YOU MAKE ANY DECISION WITH RESPECT TO
THE EXCHANGE OFFER.
4FORWARD-LOOKING STATEMENTS
Certain of the statements contained or incorporated by reference in this Exchange Offer Memorandum
are forward-looking statements that are based on management’s current views and assumptions and
involve a number of risks and uncertainties which could cause actual results to differ materially. These
include statements regarding the continued trading and listing of the Existing Notes on the SGX-ST and
the Luxembourg Stock Exchange, the financial condition and results of operations of the Bank and its
Subsidiaries (the “Group”), its financing plans, business strategies, markets for its securities and other
statements on underlying assumptions, other than statements of historical fact, including but not limited to
those that are identified by the use of words such as “anticipates”, “believes”, “estimates”, “expects”,
“intends”, “plans”, “predicts”, “projects” and similar expressions.
Factors that could cause actual results to differ include, but are not limited to, general business and
economic conditions and the state of the banking industry and the Bank’s ability to meet specific
conditions imposed (if any) for the continued listing or delisting of the Existing Notes on the SGX-ST and
the Luxembourg Stock Exchange.
All forward-looking statements attributable to the Group or persons acting on its behalf are expressly
qualified in their entirety by the cautionary statements set forth above. You should not unduly rely on such
statements. The Bank undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
5INDICATIVE OFFER TIMETABLE
Holders should take note of the dates and times set forth in the schedule below in connection with the
Exchange Offer. These dates and times are indicative only and may be changed by the Bank in
accordance with the terms and conditions of the Exchange Offer, as described herein.
Date Calendar Date Event
Commencement Date 6 March 2009 at 9:00 a.m., Launch of the Exchange Offer.
Singapore time
Closing Date 23 March 2009 at 12:00 noon, The deadline for Holders to:
Singapore time, unless extended
or terminated (i) tender Existing Notes; and
(ii) apply for additional Notes
and pay the Consideration
(as defined herein),
pursuant to the terms and
conditions of the Exchange Offer.
Settlement Date Expected to be The date the Bank issues to
27 March 2009 Holders:
(i) the Notes in exchange for all
validly tendered Existing
Notes as accepted by the
Bank; and
(ii) (where applicable) the Notes
representing successful
applications for additional
Notes.
Listing Date Expected to be The date the Notes are listed on
30 March 2009 the SGX-ST.
6SUMMARY OF THE EXCHANGE OFFER
The following summary is provided solely for the convenience of the Holders. This summary is not
complete and is qualified in its entirety by reference to the full text and more detailed information
contained elsewhere in this Exchange Offer Memorandum and any amendments or supplements thereto.
Holders are urged to read this Exchange Offer Memorandum in its entirety. Each of the capitalised terms
used in this summary and not defined herein has the meaning set forth elsewhere in this Exchange Offer
Memorandum.
Issuer Oversea-Chinese Banking Corporation Limited.
Existing Notes 5.00% Subordinated Notes due 2011. S$975,000,000 in aggregate
principal amount of the Existing Notes is outstanding as at 6 March
2009.
Notes 5.60% Subordinated Notes due 2019 Callable with Step-up in
2014.
Exchange Offer Memorandum This Exchange Offer Memorandum dated 6 March 2009.
Exchange Offer The Issuer is offering to exchange, upon the terms and subject to
the conditions contained in this Exchange Offer Memorandum, any
and all of its outstanding Existing Notes for Notes.
Holders shall receive Notes in the same principal amount of
Existing Notes validly tendered pursuant to the Exchange Offer,
plus accrued and unpaid interest on the principal amount in respect
of the validly tendered Existing Notes to, but not including, the
Settlement Date.
Holders who elect to exchange their Existing Notes in full for Notes
may also elect to apply for additional Notes in denominations of
S$1,000 principal amount and integral multiples thereof such that
the aggregate principal amount of Notes to be held by a Holder is
rounded up to the nearest multiple of S$250,000. The Bank has the
sole discretion to allocate the additional Notes and intends as far
as practicable to allocate additional Notes for rounding up
purposes only.
Consideration An amount equivalent to 100% of the aggregate principal amount
of additional Notes applied for by the relevant Holder paid, or
procured to be paid, to, or to the order of, the Issuer on or prior to
the Closing Date.
Closing Date The Exchange Offer will close at 12:00 noon, Singapore time, on
23 March 2009, unless extended or terminated by the Issuer.
Purpose of the Exchange Offer The purpose of the Exchange Offer is for the Issuer to substitute
the Existing Notes with the Notes which are expected to qualify for
full regulatory capital treatment as Tier II capital for the first six
years. Under the capital adequacy guidelines applicable in 2001
when the Existing Notes were issued, the Existing Notes which
could qualify as Tier II capital of the Issuer and the Group have
been subjected to progressive reduction of 20% per annum from
September 2006. Currently, only 40% of the Existing Notes
remain qualified as Tier II capital of the Issuer and the Group. The
Exchange Offer is therefore expected to increase the Issuer’s and
the Group’s Tier II capital and improve the mix of the Issuer’s and
the Group’s Tier I and Tier II capital.
7Withdrawal Right Except as otherwise provided in this Exchange Offer
Memorandum, Existing Notes tendered pursuant to the Exchange
Offer and applications for additional Notes may not be withdrawn.
Settlement Date The “Settlement Date” is the date of issue of:
(i) Notes to the Holders in exchange for all validly tendered
Existing Notes as accepted by the Issuer; and
(ii) (where applicable) Notes representing successful
applications for additional Notes.
The Settlement Date is expected to be 27 March 2009 unless the
Closing Date is extended, in which case the Settlement Date shall
occur five Business Days after the extended Closing Date.
“Business Day” means a day, other than a Saturday, Sunday or
public holiday, on which commercial banks and foreign exchange
markets are open for general business in Singapore.
Existing Notes Not Tendered Existing Notes not tendered pursuant to the Exchange Offer will
remain outstanding. See “Certain Significant Considerations –
Certain Consequences to Holders of Existing Notes Not Tendered”.
Holders who tender only a portion of their Existing Notes pursuant
to the Exchange Offer will retain Existing Notes equal in principal
amount to the portion of the Existing Notes not validly exchanged
pursuant to the Exchange Offer.
Certain Consequences to Holders Holders who do not tender their Existing Notes in the Exchange
of Existing Notes Not Tendered Offer will not receive any Notes. The Issuer has the sole discretion
to allocate the additional Notes and intends as far as practicable to
allocate additional Notes for rounding up purposes only.
Any Existing Notes outstanding after consummation of the
Exchange Offer will continue to be obligations of the Issuer, and
will continue to accrue and pay interest. In addition, consummation
of the Exchange Offer may have adverse consequences for
Holders who elect not to tender their Existing Notes in the
Exchange Offer. For a discussion of certain factors that should be
considered in evaluating the Exchange Offer, see “Certain
Significant Considerations”.
Procedures for Acceptance of To accept the Exchange Offer, Holders must follow the procedures
the Exchange Offer set forth in “Appendix 1 – Procedures for Acceptance of the
Exchange Offer and Application for Additional Notes”.
Representations and Warranties By offering Existing Notes for exchange in the Exchange Offer,
of Holders Holders will be deemed to make a series of representations and
warranties, which are set out in “The Terms of the Exchange Offer
– Representations, Warranties and Undertakings”.
Extensions; Termination The Issuer expressly reserves the right, in its sole discretion,
subject to applicable law, at any time from time to time to:
extend the Closing Date; and/or
terminate the Exchange Offer and not accept for exchange
the Existing Notes.
8Interest due on Existing Notes Holders shall receive accrued and unpaid interest on the principal
amount in respect of the validly tendered Existing Notes to, but not
including, the Settlement Date. This includes interest on the
Existing Notes due on 6 March 2009 which will be paid to Holders,
even if the Existing Notes are tendered under the Exchange Offer
on 6 March 2009.
Further Information Holders may request copies of this Exchange Offer Memorandum
or the FAA from CDP at the address set forth herein during normal
business hours up to 12:00 noon on the Closing Date.
9SUMMARY OF THE NOTES
The following summary does not purport to be complete and is qualified in its entirety by reference to the
full text and more detailed information contained elsewhere in this Exchange Offer Memorandum (in
particular, under “Appendix 2 – Terms and Conditions of the Notes”) and any amendments or
supplements thereto.
Issuer Oversea-Chinese Banking Corporation Limited.
Lead Manager Oversea-Chinese Banking Corporation Limited.
Trustee The Bank of New York Mellon.
Principal Paying Agent Oversea-Chinese Banking Corporation Limited.
Issue Size Up to S$1,000,000,000.
Issue Date The Settlement Date, which is expected to be 27 March 2009.
Issue Price 100%.
Step-up Date The day falling five years from the Issue Date, which is expected to
be 27 March 2014.
Maturity Date The day falling 10 years from the Issue Date, which is expected to
be 27 March 2019.
Capital Treatment of Notes It is expected that the Notes will qualify as Lower Tier II regulatory
capital of the Issuer and the Group.
Interest on the Notes The Notes will bear interest at a rate of 5.60% per annum, from
and including the Issue Date to but excluding the Step-up Date,
and thereafter at a rate of 7.35% per annum, payable semi-
annually in arrear as more fully described under “Appendix 2 –
Terms and Conditions of the Notes – Interest Payments”.
Subordination The Notes and Coupons (as defined in the terms and conditions of
the Notes (the “Terms and Conditions”)) constitute direct,
unsecured and subordinated obligations of the Issuer ranking pari
passu without any preference among themselves. Upon the
occurrence of any winding-up proceeding, the rights of the
Noteholders and Couponholders (each as defined in the Terms and
Conditions) to payment of principal of and interest on the Notes
and Coupons and any other obligations in respect of the Notes and
Coupons are expressly subordinated and subject in right of
payment to the prior payment in full of all claims of Senior Creditors
(as defined in the Terms and Conditions) and will rank senior to all
share capital of the Issuer, Tier I Capital Securities and Upper Tier
II Capital Securities (each as defined in the Terms and Conditions).
The Notes and Coupons will rank pari passu with all subordinated
debt issued by the Issuer that qualifies as Lower Tier II Capital
Securities (as defined in the Terms and Conditions). See
“Appendix 2 – Terms and Conditions of the Notes – Status and
Subordination”.
10In the event that (i) Noteholders or Couponholders do not receive
payment in full of the principal amount of such Notes plus interest
thereon accrued to the date of repayment in any winding-up of the
Issuer and (ii) the winding-up order or resolution passed for the
winding-up of the Issuer or the dissolution of the Issuer is
subsequently stayed, discharged, rescinded, avoided, annulled or
otherwise rendered inoperative, then to the extent that such
Noteholders or Couponholders did not receive payment in full of
such principal of and interest on such Notes or Coupons, such
unpaid amounts shall remain payable in full; provided that payment
of such unpaid amounts shall be subject to the default and
enforcement and subordination provisions under the Terms and
Conditions and the Trust Deed (as defined in the Terms and
Conditions). See “Appendix 2 – Terms and Conditions of the Notes
– Status and Subordination”.
Optional Redemption Subject to (i) the prior approval of the Monetary Authority of
Singapore (the “MAS”) and (ii) having given not less than 10 days’
notice to the Noteholders (which notice shall be irrevocable), the
Notes will be redeemable on the Step-up Date in whole, but not in
part, at the option of the Issuer at a price equal to their principal
amount together with all accrued but unpaid interest (if any) to (but
excluding) the date of redemption.
Tax Event Redemption Upon the occurrence of a Tax Event, the Issuer may, subject to (i)
the prior approval of the MAS and (ii) having given not less than 30
nor more than 60 days’ notice to the Noteholders (which notice
shall be irrevocable), redeem the Notes in whole, but not in part, at
a price equal to their principal amount together with all accrued but
unpaid interest (if any) to (but excluding) the date of redemption.
A “Tax Event” is deemed to have occurred if, as a result of a Tax
Law Change (as defined in the Terms and Conditions), (a) in
making any payments on the Notes, the Issuer has paid or will or
would on the next payment date be required to pay Additional
Amounts (as defined in the Terms and Conditions) on the Notes, or
(b) payments of interest on the Notes would be treated as
“distributions” or dividends within the meaning of the Income Tax
Act, Chapter 134 of Singapore (the “ITA”) or any other act in
respect of or relating to Singapore taxation or would otherwise be
considered as payments of a type that are non-deductible for
Singapore income tax purposes, and the Issuer cannot avoid the
foregoing in connection with the Notes by taking measures
reasonably available to it.
Change of Qualification Event Upon the occurrence of a Change of Qualification Event, the Issuer
Redemption may, subject to (i) the prior approval of the MAS and (ii) having
given not less than 30 nor more than 60 days’ notice to the
Noteholders (which notice shall be irrevocable), redeem the Notes
in whole, but not in part, at a price equal to their principal amount
together with all accrued but unpaid interest (if any) to (but
excluding) the date of redemption.
A “Change of Qualification Event” is deemed to have occurred if, as
a result of a change or proposed change to the relevant
requirements issued by the MAS in relation to the qualification of
the Notes as Lower Tier II Capital Securities of the Issuer, or any
change in the application of official or generally published
11interpretation of such relevant requirements issued by the MAS or
any relevant authority, including a ruling or notice issued by the
MAS or any relevant authority, or any interpretation or
pronouncement by the MAS or any relevant authority that provides
for a position with respect to such relevant requirements issued by
the MAS that differs from the previously generally accepted
position in relation to similar transactions or which differs from any
specific written statements made by any authority regarding the
qualification of the Notes as Lower Tier II Capital Securities of the
Issuer, which change or amendment (i) (subject to (ii) below)
becomes, or would become, effective on or after the Issue Date, or
(ii) in the case of a change or proposed change in the relevant
requirements issued by the MAS, if such change is issued or is
expected to be issued by the MAS, on or after the Issue Date, the
Notes would not qualify as Lower Tier II Capital Securities of the
Issuer.
Default and Enforcement If the Issuer fails to pay principal of or interest on any Note or
Coupon when due (which default in the case of principal continues
for seven Business Days and in the case of interest continues for
14 Business Days), the Trustee’s sole remedy shall be the right to
institute proceedings in Singapore (but not elsewhere) for the
winding-up of the Issuer. If the Issuer defaults in the performance
of any other obligation contained in the Trust Deed, the Notes or
the Coupons, the Trustee, the Noteholders and Couponholders
shall be entitled to every right and remedy given thereunder or
existing at law or in equity or otherwise, provided, however, that the
Trustee shall have no right to enforce payment under or accelerate
payment of any Note or Coupon except as described in the default
and enforcement provisions of the Terms and Conditions and the
Trust Deed. If any court awards money damages or other restitution
for any default with respect to the performance by the Issuer of its
obligations contained in the Trust Deed, the Notes or Coupons, the
payment of such money damages or other restitution shall be
subject to the subordination provisions set out in the Terms and
Conditions and the Trust Deed. Subject to the subordination
provisions as set out in the Terms and Conditions and the Trust
Deed, if a court order is made or an effective resolution is passed
for the winding-up of the Issuer, there shall be payable on the
Notes and Coupons, after the payment in full of all claims of all
Senior Creditors, but in priority to shareholders (including
preference shareholders), holders of Tier I Capital Securities and
holders of Upper Tier II Capital Securities, such amount remaining
after the payment in full of all claims of all Senior Creditors up to,
but not exceeding, the principal amount of the Notes together with
interest accrued to the date of repayment.
Withholding Tax and The Issuer will pay such Additional Amounts as may be necessary
Additional Amounts in order that the net payment receivable by each Noteholder or
Couponholder in respect of the Notes, after withholding for any
taxes imposed by the tax authorities of Singapore, will equal the
amount which would have been receivable in the absence of any
such withholding taxes, subject to customary exceptions, as more
fully described under “Appendix 2 – Terms and Conditions of the
Notes – Taxation”.
12Listing Approval in-principle has been obtained for the listing of the Notes
on the SGX-ST. So long as the Notes are listed on the SGX-ST
and the SGX-ST so requires, the Notes will be traded on the SGX-
ST in a minimum board lot size of S$250,000.
Governing Law The Notes and Coupons will be governed by, and construed in
accordance with, the laws of Singapore.
Form and Denomination The Notes will be represented by beneficial interests in a
permanent global note (the “Permanent Global Note”) which will
be deposited with CDP on the Settlement Date. Save in limited
circumstances, Notes in definitive bearer form with Coupons will
not be issued in exchange for interests in the Permanent Global
Note. The Notes will be denominated in the principal amount of
S$1,000. For the avoidance of doubt, transfers of Notes
between the securities accounts of Depositors (as defined
herein) can only be made in the principal amount of S$1,000
and integral multiples thereof.
Rating of the Notes The Notes are rated Aa2 by Moody’s, A+ by Fitch and A by S&P.
The Terms and Conditions are set forth under “Appendix 2 – Terms and Conditions of the Notes”.
13CERTAIN DIFFERENCES BETWEEN THE NOTES AND THE EXISTING NOTES
The table below sets out some of the differences between the Notes and the Existing Notes. It does not
purport to be complete and is qualified in entirety by reference to the terms and conditions of the Existing
Notes as set out in the Indenture dated 6 July 2001 between the Issuer and The Bank of New York (now
The Bank of New York Mellon), a copy of which is available for inspection at 65 Chulia Street #29-00,
OCBC Centre, Singapore 049513, and the Terms and Conditions of the Notes, as set out in “Appendix 2
– Terms and Conditions of the Notes”.
Feature Notes Existing Notes
Instrument 10 non-call 5 subordinated 10-year bullet subordinated
notes notes
Initial Interest Rate 5.60% per annum from the 5.00% per annum from the
Issue Date up to but issue date up to but
excluding the Step-up Date excluding the maturity date
Step-up Interest Rate 7.35% per annum from the No step-up
Step-up Date up to but
excluding the Maturity Date,
if the Notes are not
redeemed, purchased or
cancelled
Step-up Date The day falling five years Not applicable
from the Issue Date, which
is expected to be 27 March
2014
Maturity Date The day falling 10 years 6 September 2011
from the Issue Date, which
is expected to be 27 March
2019
Interest Deferral No interest deferral option With interest deferral option
Ranking Rank pari passu with all Rank pari passu with all
subordinated debt of the subordinated debt of the
Issuer that qualifies as Issuer that qualifies as
Lower Tier II capital Upper Tier II capital
securities securities
Will rank senior to the Will be subordinated to the
Existing Notes in the event new Notes in the event of a
of a winding-up of the winding-up of the Issuer
Issuer
Rating Aa2 (Moody’s) Aa2 (Moody’s)
A+ (Fitch) A+ (Fitch)
A (S&P) A- (S&P)
14CERTAIN SIGNIFICANT CONSIDERATIONS
You should carefully review the following considerations, in addition to the other information set forth
herein, before determining whether or not to tender your Existing Notes and (if applicable) apply for
additional Notes.
Certain Terms of the Existing Notes
The Existing Notes were issued under the Issue Documents (as defined herein) all dated 6 July 2001. As
of the date hereof, S$975,000,000 in aggregate principal amount of the Existing Notes remains
outstanding. The Existing Notes accrue interest at a rate of 5.00% per annum, payable semi-annually in
arrear on 6 March and 6 September of each year, subject to the terms and conditions of the Existing
Notes. The Existing Notes mature on 6 September 2011.
The above description of the terms of the Existing Notes is qualified in its entirety by reference to the full
and complete terms contained in the Issue Documents (including the form of the Existing Notes attached
thereto).
Future Actions in Respect of the Existing Notes
Following the completion of the Exchange Offer, the Bank may purchase additional Existing Notes in the
open market, in privately negotiated transactions, or through future tender offers. Any future purchase
may be on the same terms or on terms that are more or less favorable to Holders of Existing Notes than
the terms of the Exchange Offer. Any future purchases by the Bank will depend on various factors
existing at that time. There can be no assurance as to which of these alternatives, if any, the Bank will
ultimately choose to pursue in the future.
Risks Relating to the Group
An economic downturn in Singapore and/or Malaysia could adversely affect the operations, asset quality
and growth of the Group.
On a geographical basis as at 31 December 2008, 87% of the Group’s total assets are in Singapore and
Malaysia and 93% of the Group’s profit before tax is derived from Singapore and Malaysia. As such, the
Group’s performance and the quality and growth of its assets are substantially dependent on the health of
the Singapore and Malaysia economies. The economic environment in Singapore and Malaysia is
dependent on trade and investment and may be significantly impacted by a variety of external factors,
including the economic developments throughout Asia and in the United States and other markets. In
other countries where the Group operates, which are primarily in Asia, its business is also dependent on
the economic environment in those countries.
In addition, other factors such as the current financial crisis, volatile oil prices or any other adverse social
or political incident may severely affect the economic conditions in the Group’s key markets, which could
also have a material adverse effect on the Group’s business, financial condition or results of operations.
Expansion into Asian markets may increase the Group’s risk profile.
Building growth in overseas markets forms a key pillar of the Group’s strategy. In 2005, the Bank
increased its presence significantly in Indonesia with the acquisition of a majority stake in PT Bank NISP
Tbk, now known as PT Bank OCBC NISP Tbk (“Bank OCBC NISP”). In 2006, the Group acquired a
12.2% stake in Bank of Ningbo in China, which was later diluted to 10% after the listing of Bank of
Ningbo in 2007. In 2008, the Group further raised its stake in VP Bank in Vietnam from 10% to 15%. In
August 2007, the Bank officially commenced business at its new wholly-owned subsidiary, OCBC Bank
(China) Ltd, in China.
Outside Malaysia, the Group intends to focus on growing Indonesia and China as its other key overseas
markets. Such regional expansion increases its risk profile and exposure to asset quality problems. There
can be no assurance that such regional expansion will not have a material adverse effect on the Group’s
business, financial condition or results of operations or that the Group’s credit and provisioning policies
will be adequate in relation to such risks.
15The current recession in the United States, major Organisation for Economic Co-operation and
Development (“OECD”) countries and Singapore, and the ongoing global financial crisis, may continue to
negatively impact the Group’s results of operations.
The U.S. sub-prime housing crisis which began in 2007 has evolved into a global financial and economic
crisis in 2008. The U.S., Japan, major OECD economies as well as Singapore were in recession by the
last quarter of 2008. These developments have contributed to a 16% decline in the Group’s net profit for
the financial year ended 31 December 2008 to S$1,749 million. The Group’s business, financial condition
and results of operations may continue to be impacted in 2009 and beyond, depending on when the
Singapore and global economies recover, and on the strength of the recovery.
Any substantial increase in non-performing loans (“NPLs”) may impair the Group’s financial condition.
The NPLs of the Group were approximately S$1,348 million and S$1,354 million as at 31 December 2008
and 31 December 2007, respectively. As a percentage of gross customer loans, the Group’s NPLs were
1.5% and 1.7% as at 31 December 2008 and 31 December 2007, respectively. Expected weakness in the
regional and global economies in 2009 is likely to result in higher NPL ratios for banks. A substantial
increase in the Group’s NPLs may have a material adverse effect on its business, financial condition,
results of operations and capital adequacy ratio.
A decline in collateral values or inability to realise collateral value may increase the Group’s loan loss
allowances.
A significant portion of the Group’s loan portfolio is secured by real estate. While prices of private
residential properties in Singapore were on an uptrend from 2004 to 2007, they have since declined in
2008, in line with weaker economic conditions. In the event of a protracted downturn in the real estate
markets, a portion of the Group’s loans may exceed the value of the underlying collateral. Any decline in
the value of the collateral securing the Group’s loans, inability to obtain additional collateral or inability to
realise the value of collateral may require the Group to increase its loan loss allowances, which may
adversely affect the Group’s business, financial condition or results of operations.
Liquidity shortfalls may increase the cost of funds.
Most of the Group’s funding requirements are met through a combination of funding sources, primarily in
the form of deposit-taking activities and interbank funding. A portion of the Group’s assets have long-term
maturities, creating a potential for funding mismatches.
As at 31 December 2008, a significant portion of the Group’s customer deposits had current maturities of
one year or less or were payable on demand. Such deposits are mainly from savings, fixed and current
accounts and demand deposits. The Group’s deposit base is diversified and does not rely on any
significant depositor funding. However, no assurance can be given that this will continue. In circumstances
where a substantial number of depositors withdraw such funds from the Group, the Group’s liquidity
position could be materially adversely affected. In such a situation, the Group could be required to seek
alternative short-term and long-term funds, which may be more expensive than current funding sources,
to finance operations, which may adversely affect the Group’s business, financial condition or results of
operations.
Significant fraud, systems failure or calamities could adversely impact the Group’s business.
The Group seeks to protect its computer systems and network infrastructure from physical break-ins as
well as fraud and systems failures. The Group employs external surveillance security systems, including
firewalls, tokens and password encryption technologies, designed to minimise the risk of security
breaches around the clock. Although the Group intends to continue to implement security technologies,
conduct regular vulnerability assessments and network penetration tests and establish operational
procedures to prevent break-ins, damages and failures, there can be no assurance that these security
measures will be successful. In addition, although the Group’s centralised data centre and back-up
systems are separately located in different places, there can be no assurance that both systems will not
be simultaneously damaged or destroyed in the event of a major disaster. The Group seeks to maintain
internal controls in line with international best practices. However, a significant breakdown in internal
controls, fraudulent activities by employees or failure of security measures or back-up systems may have
a material adverse effect on the Group’s business, financial condition or results of operations.
16The Group may be affected by changes in laws and regulations.
The Group’s operations in the respective jurisdictions in which it has operations are subject to the
prevailing laws and regulations in relation to banks in those jurisdictions. Accordingly, the Group’s
business may be affected by any changes in such laws and regulations and may result in higher costs of
compliance for the Group. In addition, the Group may be subject to the imposition of fines and/or other
penalties by the relevant authorities if it fails to comply with the applicable laws and regulations and this
could also adversely impact the Group’s business, financial condition or results of operations.
Risks Relating to the Exchange Offer
The Bank is conducting the Exchange Offer for the exchange of Existing Notes for Notes. Before
tendering any Existing Notes and applying for additional Notes, Holders should review this Exchange
Offer Memorandum and carefully consider whether they desire to participate in the Exchange Offer.
Holders that validly tender their Existing Notes for exchange in accordance with the terms of the
Exchange Offer, and Holders whose applications for additional Notes have been accepted by the Bank,
will receive the Notes. Allocation of additional Notes will be made at the sole discretion of the Bank, which
intends as far as practicable to allocate the additional Notes for rounding up purposes only.
Certain Consequences to Holders of Existing Notes Not Tendered.
Holders who do not tender their Existing Notes in the Exchange Offer will not receive any Notes.
Any Existing Notes that remain outstanding after consummation of the Exchange Offer will continue to be
obligations of the Bank. The Existing Notes will continue to accrue interest at a rate of 5.00% per annum,
payable semi-annually in arrear on 6 March and 6 September of each year, subject to the terms and
conditions of the Existing Notes.
Consummation of the Exchange Offer may have certain adverse consequences for Holders of Existing
Notes that elect not to tender their Existing Notes, or that elect not to tender their Existing Notes in full, in
the Exchange Offer. See “Adverse Effects on Trading Market for the Existing Notes” below.
Adverse Effects on Trading Market for the Existing Notes.
To the extent that Existing Notes are tendered and accepted in the Exchange Offer, the trading market for
the Existing Notes that remain outstanding thereafter may become significantly reduced. A debt security
with a smaller outstanding principal amount available for trading, which we refer to as a smaller “float”,
may command a lower price than would a comparable debt security with a larger float. Therefore, the
market price for Existing Notes not tendered for exchange may be affected adversely to the extent that
the principal amount of Existing Notes tendered and exchanged pursuant to the Exchange Offer reduces
the float of the Existing Notes. The reduced float may also make the trading price more volatile. There can
be no assurance that any trading market will exist for any Existing Notes outstanding following the
consummation of the Exchange Offer. The extent of the market for the Existing Notes following
consummation of the Exchange Offer would depend upon, among other things, the remaining outstanding
principal amount of Existing Notes after the Exchange Offer, the number of Holders who remain at that
time and the interest in maintaining a market in the Existing Notes on the part of securities firms, and
other factors.
The Existing Notes are currently listed on the SGX-ST and the Luxembourg Stock Exchange. In the event
that the Exchange Offer is successful, subject to the terms and conditions of the documents signed in
relation to the issue of the Existing Notes (the “Issue Documents”), and subject to other applicable
contractual commitments of the Bank, the Bank may delist the Existing Notes from the SGX-ST and the
Luxembourg Stock Exchange. Delisting the Existing Notes from the SGX-ST and/or the Luxembourg
Stock Exchange will likely negatively impact the trading market for any Existing Notes outstanding
following the consummation of the Exchange Offer.
17Risks Relating to the Notes
Limited rights of enforcement and subordination of the Notes could impair an investor’s ability to enforce
its rights or realise any claims on the Notes.
If the Bank defaults on the payment of principal or interest on the Notes, the only action the Trustee may
take against the Bank is to institute a proceeding in Singapore for the winding-up of the Bank. The
Trustee will have no right to accelerate payment of the Notes or Coupons relating to the Notes in the case
of default in payment or failure to perform a covenant except as discussed in the preceding sentence.
The Notes and Coupons will be subordinated obligations of the Bank. Upon the occurrence of any
winding-up proceeding, the rights of the holders of the Notes and Coupons to payments on the Notes and
Coupons will be subordinated in right of payment to the prior payment in full of all deposits and other
liabilities of the Bank, except those liabilities which rank equally with or junior to the Notes and Coupons.
In a winding-up proceeding, holders of the Notes and Coupons may recover less than the holders of
deposit liabilities or the holders of other unsubordinated liabilities of the Bank. As there is no precedent
for a winding-up of a major financial institution in Singapore, there is uncertainty as to the manner in
which such a proceeding would occur and the results thereof.
The Notes may be very illiquid and no secondary market may develop in respect of the Notes.
The Notes are a new issue of securities with no established trading market. A liquid or active trading
market for the Notes may not develop. If an active trading market for the Notes does not develop or does
develop and is not maintained, the market price of the Notes may be adversely affected. If the Notes are
traded, they may trade at a discount from their initial issue price, depending on prevailing interest rates,
the market for similar securities, the Bank’s performance and other factors. Approval in-principle has been
received to list the Notes on the SGX-ST. However, if for any reason the listing is not obtained, the
liquidity of the Notes may be negatively impacted.
Singapore accounting and corporate disclosure standards may result in more limited disclosure than in
other jurisdictions.
The Group is subject to Singapore’s accounting standards and requirements that differ in certain material
respects from those applicable to banks in certain other countries. Also, there may be less publicly
available information about Singapore listed companies, such as the Bank, than is regularly made
available by or about listed companies in certain other countries.
A downgrade in ratings may affect the market price of the Notes.
The Group has received long-term ratings of Aa1 from Moody’s, AA- from Fitch and A+ from S&P. The
Notes are rated Aa2 by Moody’s, A+ by Fitch and A by S&P.
There can be no assurance that the ratings will remain in effect for any given period or that the ratings
will not be revised by the rating agencies in the future if, in their judgement, circumstances so warrant.
Global financial turmoil has led to volatility in international capital markets, which may adversely affect the
market price of the Notes.
Global financial turmoil has resulted in substantial and continuing volatility in international capital markets.
Any further deterioration in global financial conditions could have a material adverse effect on worldwide
financial markets, which may adversely affect the market price of the Notes.
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