TIDM49WP
RNS Number : 5401Z
NIBC Bank N.V.
12 January 2024
NIBC Bank N.V. announces consent solicitation in respect of its
outstanding U.S.$100,000,000 CMS linked perpetual debt securities
(ISIN: XS0215294512)
Press Release - 12 January 2024, 09:15 CET
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR TO
ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES OF AMERICA, ITS
TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN
ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA
ISLANDS, ANY STATE OF THE UNITED STATES OF AMERICA AND THE DISTRICT
OF COLUMBIA) (THE "UNITED STATES") OR TO ANY U.S. PERSON (AS
DEFINED BELOW) OR IN OR INTO ANY OTHER JURISDICTION WHERE IT IS
UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.
NIBC BANK N.V.
(formerly known as NIB Capital Bank N.V.,
incorporated with limited liability under the laws of The
Netherlands
and having its corporate seat in The Hague )
(" NIBC " and the " Issuer ")
NIBC ANNOUNCES CONSENT SOLICITATION IN RESPECT OF ITS
OUTSTANDING U.S.$100,000,000 CMS LINKED PERPETUAL DEBT SECURITIES
(ISIN: XS0215294512)
NIBC announces today an invitation (such invitation, the
"Consent Solicitation") to eligible holders of its outstanding
U.S.$100,000,000 CMS Linked Perpetual Debt Securities (ISIN:
XS0215294512) (the "Securities") to consent to the execution of the
Supplemental Trust Deed to effect, inter alia: (1) the modification
of the terms and conditions (the "Conditions") of the Securities
such that: (i) for all Interest Periods commencing from and
including the Interest Payment Date in March 2024 (which is
expected to be 24 March 2024), the Rate of Interest is calculated
by reference to the USD SOFR Spread Adjusted Swap Rate (calculated
using the ARRC Recommended Methodology, as set out in the Consent
Solicitation Memorandum (as defined below)), as opposed to being
calculated using the USD LIBOR swap rate; (ii) new fallback
provisions relating to the USD SOFR ICE Swap Rate (or any component
thereof) for the purposes of calculating the USD SOFR Spread
Adjusted Swap Rate (including fallback provisions in case a
Benchmark Transition Event occurs with respect to the USD SOFR ICE
Swap Rate (or any component thereof)) are included; and (iii) as a
consequence of the foregoing changes, a Contractual Recognition of
Bail-in Clause is included pursuant to Article 55(2) of the BRRD;
and (2) consequential amendments to Clause 19.2 (Modification) of
the Trust Deed in respect of the new fallback provisions.
The Issuer will pay a Consent Fee to Eligible Securityholders
that submit valid electronic voting instructions to the Tabulation
Agent by 4:00 p.m. (London time) / 5:00 p.m. (CET) on 31 January
2024 (the "Expiration Deadline"), subject to the successful passing
of the Extraordinary Resolution and the satisfaction of the other
conditions set out in the Consent Solicitation Memorandum, on the
Fee Payment Date. The "Consent Fee" shall be an amount equal to
0.50 per cent. of the principal amount of the relevant Securities
that are the subject of the relevant electronic voting instruction,
which will be payable to Eligible Securityholders in the
circumstances described the Consent Solicitation Memorandum.
Ineligible Securityholders who submit a valid Ineligible Holder
Instruction waiving their right to attend and vote (or be
represented) at the Meeting by the Expiration Deadline will also be
eligible to receive an amount equal to the Consent Fee (the
Ineligible Holder Instruction Fee), subject to the successful
passing of the Extraordinary Resolution and the satisfaction of the
other conditions set out in the Consent Solicitation Memorandum, on
the Fee Payment Date by following the procedures specified in the
Notice.
The full terms and conditions of the Consent Solicitation are
contained in the Consent Solicitation Memorandum dated 12 January
2024 (the "Consent Solicitation Memorandum") prepared by NIBC,
which is available to Eligible Securityholders from the Tabulation
Agent (including on its website via the link
https://deals.is.kroll.com/nibc ).
A notice convening the meeting of the holders of the Securities,
to be held at the offices of Clifford Chance LLP at Droogbak 1A,
1013 GE Amsterdam, The Netherlands on 5 February 2024 has been
given to holders of the Securities ("Securityholders") in
accordance with the Conditions on the date of this announcement,
including by way of publication on NIBC's website (
https://nibc.com/ ), by delivery to the Clearing Systems and via
the website of Euronext Amsterdam.
Background TO CONSENT SOLICITATION
Status of LIBOR
In July 2017, the UK Financial Conduct Authority (the "FCA")
announced that it would no longer persuade or compel banks to
submit rates for the calculation of the LIBOR benchmark after the
end of 2021 and explained they expected that some panel banks would
cease contributing to LIBOR panels at such time.
On 5 March 2021, the administrator of LIBOR, ICE Benchmark
Administration Limited (" IBA ") announced its intention to cease
the publication of all 35 LIBOR settings, the majority on 31
December 2021, and for certain USD LIBOR settings, on 30 June 2023,
subject to the rights of the FCA to compel continued publication.
The IBA notified the FCA of its intention and, on the same date,
the FCA published an announcement stating that all 35 LIBOR
settings would either cease to be provided by any administrator or
no longer be representative of the underlying market and economic
reality (and that representativeness would not be restored)
immediately after: (i) 31 December 2021, in the case of all
sterling, euro, Japanese Yen and Swiss Franc, and certain U.S.
Dollar settings; or (ii) 30 June 2023, in the case of the remaining
U.S. Dollar settings.
The Alternative Reference Rates Committee ("ARRC") was convened
by the Federal Reserve Board and the Federal Reserve Bank of New
York to help ensure a successful transition from USD LIBOR to a
more robust reference rate and to this end the ARRC has published a
number of reports and guiding principles concerning its
recommendations for spread-adjusted fallbacks for contracts
referencing USD LIBOR. Following extensive consultations and
discussion of potential candidates, the ARRC identified SOFR as the
rate that represents best practice for use in certain new USD
derivatives and other financial contracts. The Federal Reserve
began to publish SOFR in April 2018.
USD swap rates based on USD LIBOR swap transactions are
determined by reference to the USD LIBOR ICE Swap Rate (available
in various tenors) calculated and administrated by the IBA (for
swaps referencing 3-month USD LIBOR) (" USD LIBOR ICE Swap Rate
").
In March 2021, the ARRC proposed a suggested fallback formula
for the USD LIBOR ICE Swap Rate which instead references the USD
SOFR ICE Swap Rate, adds The International Swaps and Derivatives
Association, Inc. ("ISDA") fallback spread adjustment for 3-month
USD LIBOR (26.161 bps) and applies technical adjustments to account
for differences in payment frequency and day count conventions
between USD LIBOR and USD SOFR swaps (the " ARRC Recommended
Methodology ").
In June 2021, ISDA launched a consultation to seek feedback on
the incorporation in the ISDA definitions of a fallback formula
for, amongst other things, the USD LIBOR ICE Swap Rate (using the
ARRC Recommended Methodology). In July 2021, ISDA announced the
results of this consultation, which indicated that a significant
majority of respondents agreed with such fallback formula and that
the conditions were satisfied for them to be incorporated in the
ISDA definitions. As a result of this, on 10 November 2021, ISDA
published Supplement 88 to the 2006 ISDA Definitions which updated
provisions in the 2006 ISDA Definitions that referred or related to
the USD LIBOR ICE Swap Rate to refer to a fallback rate calculated
on the basis of ARRC Recommended Methodology.
On 8 November 2021, the IBA launched the USD SOFR ICE Swap Rate
for use in financial contracts and instruments. On 30 August 2022,
the IBA announced its intention to cease the publication of all USD
LIBOR ICE Swap Rate(R) benchmark settings for all tenors
immediately after the cessation of publication of USD LIBOR on 30
June 2023 subject to a consultation with market participants.
Subsequently, on 14 November 2022, the IBA published a feedback
statement from this consultation in which it stated that it would
cease the publication of all USD LIBOR ICE Swap Rate benchmark
settings for all tenors immediately after publication on 30 June
2023.
Rationale for the proposed amendments to the Rate of
Interest
As noted above: (i) the USD SOFR Spread Adjusted Swap Rate is
calculated in accordance with the ARRC Recommended Methodology and
on the basis of the ARRC Recommended Formula included therein; and
(ii) ISDA's consultation in June 2021 (which sought feedback from
market participants on the use of the ARRC Recommended Methodology
as a fallback for the USD LIBOR ICE Swap Rate) concluded that a
majority of respondents agreed with the use of the ARRC Recommended
Methodology. As such, the Proposed Amendments seek to align with
the industry approved methodologies recommended by the ARRC and
ISDA as fallbacks to the USD LIBOR ICE Swap Rate.
If the Extraordinary Resolution is not passed, the ultimate
contractual fallback under the terms of the Securities is that the
Rate of Interest will be the same as the rate determined in
relation to the preceding Interest Determination Date.
Rationale for addition of contractual recognition of bail-in
clause
The directive providing for the establishment of an EU-wide
framework for the recovery and resolution of credit institutions
and investment firms (Directive 2014/59/EU) (known as the " Bank
Recovery and Resolution Directive " or " BRRD ") entered into force
on 2 July 2014 and was subsequently implemented in The Netherlands
through the BRRD Implementation Act ( Implementatiewet Europees
kader voor herstel en afwikkeling van banken en
beleggingsondernemingen ) which amended the Dutch Financial
Supervision Act ( Wet op het financieel toezicht ) with effect from
26 November 2015.
Article 55(1) of the BRRD requires institutions to include "a
contractual term by which the creditor or party to the agreement or
instrument creating the liability recognises that the liability may
be subject to the write-down and conversion powers and agrees to be
bound by any reduction of the principal or outstanding amount due,
conversion or cancellation that is effected by the exercise of
those powers by a resolution authority" (a " Contractual
Recognition of Bail-in Clause ") where, inter alia, such liability
is governed by the law of a third country and is "issued or entered
into" after the date on which the transposition of the BRRD into
national law became applicable.
Pursuant to Article 43(2)(b) of Commission Delegated Regulation
(EU) 2016/1075 of 23 March 2016, as amended (the "Delegated
Regulation"), Article 55(1) of the BRRD is applicable to
liabilities created before such date of transposition of the BRRD
into national law where they are subject to "material amendment"
which is defined in Article 42(1) of the Delegated Regulation as
being "an amendment, including an automatic amendment, made after
that date and affecting the substantive rights and obligations of a
party to a relevant agreement".
Following the UK's withdrawal from the European Union and the
end of the transitional period, English law has now become a third
country law. As a result, the Issuer would be required to include a
Contractual Recognition of Bail-in Clause at the same time as the
other Proposed Amendments.
Securityholders should note that Article 55(2) of the BRRD
specifies that, in any event, the failure to include a Contractual
Recognition of Bail-in Clause " shall not prevent the resolution
authority from exercising the write down and conversion powers in
relation to that liability ".
As of the date hereof, applicable authorities have communicated
that the preferred resolution strategy for the Issuer is normal
insolvency, which means that, should it fail, the plan is that the
Issuer would be liquidated under normal insolvency law and so
resolution would not be triggered (and the bail-in tool not used).
There is no guarantee, however, that such plan will be followed in
a liquidation or resolution scenario, and on 18 April 2023 the
European Commission adopted a proposal to promote the use of
resolution tools for small and medium sized banks.
On this basis, and as a consequence of the amendments proposed
to the Conditions in respect of the determination of the Rate of
Interest (as set out in the Consent Solicitation Memorandum) and
the Securities being governed by English law, the Issuer is
required to include a Contractual Recognition of Bail-in Clause in
the Conditions pursuant to Article 55(2) of the BRRD and in
accordance with customary market practice following the UK's
withdrawal from the European Union and the end of the transitional
period .
Further details on the Consent Solicitation can be obtained
from:
SOLE SOLICITATION AGENT
NatWest Markets N.V.
Claude Debussylaan 94
1082 MD Amsterdam
The Netherlands
Attention : Liability Management
Telephone : +44 20 7085 6124
Email : NWMLiabilityManagement@natwestmarkets.com
Requests for documentation and information in relation to the
procedures for delivering consent instructions should be directed
to:
TABULATION AGENT
Kroll Issuer Services Limited
The Shard
32 London Bridge Street
London SE1 9SG
United Kingdom
Telephone : +44 207 704 0880
Attention : Arlind Bytyqi / Paul Kamminga
Email : nibc@is.kroll.com
Website : https://deals.is.kroll.com/nibc
Unless otherwise indicated, capitalised terms used but not
otherwise defined in this announcement have the meanings given in
the Consent Solicitation Memorandum.
DISCLAIMER
THIS ANNOUNCEMENT MUST BE READ IN CONJUNCTION WITH THE NOTICE
AND (IN RESPECT OF ELIGIBLE SECURITYHOLDERS) THE CONSENT
SOLICITATION MEMORANDUM. THIS ANNOUNCEMENT, THE NOTICE AND THE
CONSENT SOLICITATION MEMORANDUM CONTAIN IMPORTANT INFORMATION WHICH
SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE WITH RESPECT
TO THE CONSENT SOLICITATION.
IF SECURITYHOLDERS ARE IN ANY DOUBT ABOUT ANY ASPECT OF THE
PROPOSALS IN THE NOTICE AND/OR THE ACTION THEY SHOULD TAKE, THEY
ARE RECOMMENDED TO SEEK THEIR OWN FINANCIAL ADVICE IMMEDIATELY FROM
THEIR BROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR OTHER ANOTHER
APPROPRIATELY AUTHORISED INDEPENDENT FINANCIAL ADVISER AND SUCH
OTHER PROFESSIONAL ADVISERS AS THEY DEEM NECESSARY.
NOTHING IN THIS ANNOUNCEMENT, THE NOTICE OR THE CONSENT
SOLICITATION MEMORANDUM OR THE ELECTRONIC TRANSMISSION THEREOF
CONSTITUTES OR CONTEMPLATES AN OFFER OF, AN OFFER TO PURCHASE OR
THE SOLICITATION OF AN OFFER TO SELL SECURITIES IN THE UNITED
STATES OR ANY OTHER JURISDICTION. THE SECURITIES HAVE NOT BEEN, AND
WILL NOT BE, REGISTERED UNDER THE SECURITIES ACT, OR THE SECURITIES
LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES, AND
THE SECURITIES MAY NOT BE OFFERED, SOLD OR DELIVERED, DIRECTLY OR
INDIRECTLY, WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT) EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND APPLICABLE STATE OR LOCAL SECURITIES LAWS.
IN ACCORDANCE WITH NORMAL PRACTICE, THE TRUSTEE, THE PRINCIPAL
PAYING AGENT AND THE TABULATION AGENT HAVE NOT BEEN INVOLVED IN THE
FORMULATION OF THE SECURITYHOLDER PROPOSAL. THE TRUSTEE, THE
TABULATION AGENT AND THE SOLE SOLICITATION AGENT EXPRESS NO OPINION
ON, AND MAKE NO REPRESENTATIONS AS TO THE MERITS OF, THE
SECURITYHOLDER PROPOSAL, THE EXTRAORDINARY RESOLUTION OR THE
PROPOSED AMENDMENTS REFERRED TO IN THE EXTRAORDINARY
RESOLUTION.
NONE OF THE TABULATION AGENT, THE SOLE SOLICITATION AGENT AND
THE TRUSTEE MAKES ANY REPRESENTATION THAT ALL RELEVANT INFORMATION
HAS BEEN DISCLOSED TO SECURITYHOLDERS IN OR PURSUANT TO THE NOTICE,
THE CONSENT SOLICITATION MEMORANDUM OR OTHERWISE. NONE OF THE
TABULATION AGENT, THE SOLE SOLICITATION AGENT AND THE TRUSTEE HAS
APPROVED THE DRAFT SUPPLEMENTAL TRUST DEED REFERRED TO IN THE
EXTRAORDINARY RESOLUTION AND SECURITYHOLDERS ARE RECOMMENDED TO
ARRANGE TO INSPECT AND REVIEW SUCH DRAFT SUPPLEMENTAL TRUST DEED AS
PROVIDED IN THE NOTICE. ACCORDINGLY, SECURITYHOLDERS SHOULD TAKE
THEIR OWN INDEPENDENT LEGAL, FINANCIAL, TAX OR OTHER ADVICE ON THE
MERITS AND THE CONSEQUENCES OF VOTING IN FAVOUR OF THE
EXTRAORDINARY RESOLUTION, INCLUDING ANY TAX CONSEQUENCES, AND ON
THE IMPACT OF THE IMPLEMENTATION OF THE EXTRAORDINARY
RESOLUTION.
NONE OF THE TABULATION AGENT, THE SOLE SOLICITATION AGENT AND
THE TRUSTEE ARE RESPONSIBLE FOR THE ACCURACY, COMPLETENESS,
VALIDITY OR CORRECTNESS OF THE STATEMENTS MADE IN THE CONSENT
SOLICITATION MEMORANDUM OR THE NOTICE, OR OMISSIONS THEREFROM.
NONE OF THIS ANNOUNCEMENT, THE NOTICE OR THE CONSENT
SOLICITATION MEMORANDUM CONSTITUTES OR FORMS PART OF, OR SHOULD BE
CONSTRUED AS, AN OFFER FOR SALE, EXCHANGE OR SUBSCRIPTION OF, OR A
SOLICITATION OF ANY OFFER TO BUY, EXCHANGE OR SUBSCRIBE FOR, ANY
SECURITIES OF THE ISSUER OR ANY OTHER ENTITY. THE DISTRIBUTION OF
THIS ANNOUNCEMENT AND THE CONSENT SOLICITATION MEMORANDUM MAY
NONETHELESS BE RESTRICTED BY LAW IN CERTAIN JURISDICTIONS. PERSONS
INTO WHOSE POSSESSION THIS ANNOUNCEMENT OR THE CONSENT SOLICITATION
MEMORANDUM COMES ARE REQUIRED TO INFORM THEMSELVES ABOUT, AND TO
OBSERVE, ANY SUCH RESTRICTIONS.
UK MIFIR PROFESSIONALS/ELIGIBLE COUNTERPARTIES ONLY / NO UK
PRIIPS KID - MANUFACTURER TARGET MARKET (UK MIFIR PRODUCT
GOVERNANCE) IS ELIGIBLE COUNTERPARTIES AND PROFESSIONAL CLIENTS
ONLY (ALL DISTRIBUTION CHANNELS). NO UK PRIIPS KEY INFORMATION
DOCUMENT (KID) HAS BEEN PREPARED.
EU MIFID II PROFESSIONAL INVESTORS/ELIGIBLE COUNTERPARTIES ONLY
/ NO EEA PRIIPS KID - MANUFACTURER TARGET MARKET (EU MIFID II
PRODUCT GOVERNANCE) IS ELIGIBLE COUNTERPARTIES AND PROFESSIONAL
CLIENTS ONLY (ALL DISTRIBUTION CHANNELS). NO EEA PRIIPS KEY
INFORMATION DOCUMENT (KID) HAS BEEN PREPARED.
NIBC PRESS CONTACT:
Toine Teulings, Funding & Debt IR
E-mail : Toine.Teulings@nibc.com
Tel : +31 (0) 70 342 98 36
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END
STRBTMPTMTJBMFI
(END) Dow Jones Newswires
January 12, 2024 03:38 ET (08:38 GMT)
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