25,000,000,000 Medium Term Note Programme. unconditionally and irrevocably guaranteed by the Hellenic Republic

Transcription

1 THIRTEENTH SUPPLEMENT DATED 11 APRIL 2016 TO THE BASE PROSPECTUS DATED 9 APRIL 2009 NATIONAL BANK OF GREECE S.A. (incorporated with limited liability in the Hellenic Republic) 25,000,000,000 Medium Term Note Programme unconditionally and irrevocably guaranteed by the Hellenic Republic This Thirteenth Supplement (the Supplement) to the Information Memorandum (the Information Memorandum) dated 9 April 2009, as previously supplemented by the supplements dated 22 April 2010, 4 May 2010, 17 December 2010, 20 May 2011, 15 April 2013, 12 May 2014, 5 January 2015, 26 March May 2015, 15 June 2015, 27 July 2015 and 14 October 2015 is prepared in connection with the Medium Term Note Programme (the Programme) established by National Bank of Greece S.A. (the Issuer or the Bank) and unconditionally and irrevocably guaranteed by the Hellenic Republic (the Guarantor). Terms defined in the Information Memorandum have the same meaning when used in this Supplement. This Supplement constitutes a Supplement to, and should be read in conjunction with, the Information Memorandum issued by the Issuer and the supplements dated 22 April 2010, 4 May 2010, 17 December 2010, 20 May 2011, 15 April 2013, 12 May 2014, 5 January 2015, 26 March 2015, 14 May 2015, 15 June 2015, 27 July 2015 and 14 October This Supplement does not comprise a supplementary prospectus for the purposes of section 87G of the Financial Services and Markets Act The Issuer accepts responsibility for the information contained in this Supplement. To the best of the knowledge of the Issuer (which has taken all reasonable care to ensure that such is the case) the information contained in this Supplement is in accordance with the facts and contains no omissions likely to affect its import. Statement regarding the fiscal position of the Hellenic Republic In deciding whether or not to purchase or subscribe for Notes, prospective investors should be aware of recent statements by the Greek Government in relation to the fiscal position of the Guarantor and proposals to address its present challenges. Recent Macroeconomic Developments Following the Hellenic Republic s sovereign debt crisis beginning in 2009 and the sharp deterioration in financial and macroeconomic conditions, a financial support mechanism was activated in May 2010, jointly supported by the International Monetary Fund (IMF) and Eurozone Member States, with terms extending through 2015 conditioned on the implementation of a very demanding economic adjustment programme. Following the government debt restructuring in February 2012, a second programme of economic adjustment and financial support for Greece was agreed with the IMF, the European Central Bank (ECB) and the EU (collectively, the Institutions), with terms extending through 2016 and conditioned on the imposition of fiscal and structural adjustment policies (the Hellenic Programme). Finally, in view of the severe economic and financial disturbances emerging between end-2014 and June 2015, that appeared to threaten the membership of the Hellenic Republic in the European Monetary Union and the EU, the Greek government officially requested financial assistance from the European Union on July 10, 2015, with a view to restoring confidence and enabling the return of the economy to sustainable growth, and safeguarding the country s financial stability. Accordingly, a three-year ESM stability support was provided to Greece in August 2015 (Source: ESM Statement, August 19, 2015), with the Greek Government agreeing on an updated set of conditions to underlie the provision of this additional financial support for the period The main policies of these programmes are aimed at eliminating the significant deficits in the Greek government budget and current account balance, and addressing significant structural deficiencies in the

2 Greek economy while providing, at the same time, sufficient amounts of external financing at concessional terms for covering sovereign debt servicing costs and other financing gaps of the Greek State. The impact of the programmes in terms of losses in production, employment and disposable income has been very high by historical standards, as the existing structural inflexibilities and the short period over which the adjustment policies have been implemented have amplified the impact on activity and social costs of the austerity measures. The intensity of economic adjustment had also been compounded by a high level of uncertainty, resulting in a sharp contraction of GDP that reached -26.1% in the period. In fact, in 2015 the Greek economy has proved resilient to a combination of several adverse factors (as discussed in more detail further below) that included: i) heightened uncertainty related to prolonged negotiations with official lenders; ii) an intensifying liquidity squeeze of the public and private sector due to significant external financing shortages and capital flight, which have been compounded by a revival of Grexit discussions in the second quarter of The effective end to discussions of Grexit, following the agreement on a new Financial Support program for Greece in July 2015 (Source: Euro Summit Statement, July 12, 2015) and the activation of the latter in August 2015 (the Program) with the disbursement of 13 billion of funding (Source: ESM Statement, August 20, 2015), did not directly translate into an improvement of sentiment as the imposition of capital controls since June 28, 2015, and the announcement of snap elections in September 2015, delayed the transmission of confidence and liquidity effects to the economy. In this very challenging environment, economic activity expanded by 0.6% in the first half of 2015 and contracted by 1.2% in the second half of 2015, with full year contraction of real GDP of 0.3% (Source: EL.STAT., Quarterly National Accounts Press Release, February 2016), being significantly milder than the unfavorable forecasts published in the third quarter of 2015 (Source: European Commission, Debt Sustainability Analysis, July 2015) following the imposition of capital controls and the three week bank holiday in July This resilience reflected, to a significant extent, the fact that capital controls had been anticipated by Greek households and firms, permitting them to pre-emptively draw up contingency plans to cushion their near-term impact (i.e., about 41 billion of domestic private sector deposits had been withdrawn between November 2014 and June 2015, Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016). Furthermore, it reflected the advanced stage of economic rebalancing in Greece following a painful multi-year economic adjustment, which made it far more resilient to external shocks. Moreover, the upsurge in cashless transactions (an almost 100% increase in terms of value, Source: Hellenic banks Association data) following the imposition of capital controls, has also supported official economic activity mainly private consumption prompting a shift of activity from the shadow to the official economy. This shift reflected an increase in demand for goods and services provided by business entities operating in the official economy, in conjunction with increasing compliance by a number of firms formerly operating in the shadow economy, and included a shift in activity to larger enterprises, to the detriment of SMEs. The progress in loosening capital control restrictions for businesses since August 2015 has also lessened their negative impact, especially on the activity of medium-to-large sized enterprises, whereas smaller firms are continuing to face more significant challenges (Source: NBG, Greece Macro View, October 2015 and February 2016). Private consumption and aggregate economic activity have also received considerable support from lower oil prices and healthy tourism activity. Lower oil prices (-36.4% year-over-year, in euro terms, Source: Federal Reserve Economic Data - FRED database) translated into a reduction of domestic energy prices of -13.9% year-over-year (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016), and a concomitant increase in disposable income, while tourism activity remained solid with arrivals increasing by 7.1% year-over-year in 2015 and revenue by 6.0% year-on-year in the same period (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016). Fixed capital formation increased by 0.9% year-over-year in 2015 (Source: EL.STAT., Quarterly National Accounts Press Release, February 2016), mainly supported by the resilient momentum of business investment in the first half of 2015 and higher public investment in the fourth quarter of In 2015, business investment increased by 3.3% year-over-year, whereas residential construction decreased by 23.3% year-over-year in 2015; however, both categories showed a notable deterioration in the second half of 2015 (-0.7% year-over-year and -26.3% year-over-year, respectively). 2

3 Labor market trends remained positive in 2015, with employment expanding by 2.1% year-over-year and unemployment declining to a three and a half-year low of 24.3% in December 2015 from 24.9% in June 2015 and 25.7% in January 2015 (Source: EL.STAT., Labour Force Survey Press Release, April 2016). The improved flexibility of the labor market and secondary effects of tourism supported employment in key sectors such as retail-wholesale trade and manufacturing (+5.6% year-over-year and +5.7% year-over-year, respectively, in 2015, source: EL.STAT., Labour Force Survey Press Release, March 2016). However, in January 2016 the unemployment rate registered an increase to 24.4% (Source: EL.STAT., Labour Force Survey Press Release, April 2016). Consumer Price Index (CPI) inflation declined by 1.7% year-over-year, on average, in 2015 on the back of falling energy prices (-13.9% year-over-year in 2015). Nonetheless, deflationary trends showed a notable deceleration in the second half of 2015 and especially in the fourth quarter of 2015, with CPI declining by 0.6% and core inflation (excluding energy and volatile foods components) increasing by 0.3%, for the first time in three years, mainly due to the inflationary impact of the VAT rate increase since July 2015 (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016). Similar trends are observed in the first three months of 2016 with headline inflation declining by 0.9% year-over-year mainly due to falling energy prices, and core CPI increasing by 0.2%, year-over-year, in the same period (Source: EL.STAT. and NBG estimates). The external position improved notably in 2015, with the current account being balanced. The contraction of trade deficit on the back of declining oil and non-oil imports (-9.0% year-over-year in total) and solid tourism revenue (+6.0% year-over-year in 2015) more than compensated for the sharp drop in non-tourism services and income revenue (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016). Capital controls appeared to discourage the repatriation of income from business activity abroad (e.g. shipping) and private capital inflows into the country. Non-oil goods exports increased by a healthy +4.6% in 2015 (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016), in this very challenging environment, supported mainly by higher demand in EU markets. Fiscal trends showed a notable improvement in the second half of 2015, following a stressed first half of 2015, along with a decline in uncertainty and the imposition of new fiscal measures in July The State budget primary balance over-performed compared with the revised targets for 2015 (included in the 2016 Government Budget) by 1.5% of GDP (excluding the impact of SMP/ANFA revenue) supported by a pickup in revenue in the second half of 2015 (an increase in tax revenue of +3.7% year-over-year in the second half of 2015 (Source: Ministry of Finance, State Budget Execution, Monthly Bulletin, June 2015 and December 2015) and further spending restraint. According to EU Commission estimates, this overperformance appears sufficient to meet the Government Budget 2016 estimates of a small primary deficit of 0.3% in 2015 budget (Source: EU Commission, Autumn Forecasts, October 2015 and Ministry of Finance, State Budget 2016, November 2015), despite the accumulation of new arrears of 1.6 billion in the private sector in 2015 (Source: Ministry of Finance, General Government Monthly Bulletin, December 2015). The debt-to-gdp ratio is estimated by the EU Commission to reach 179% in 2015 and peak at 185% in 2016 (Source: EU Commission, Winter Forecasts, February 2016). These figures are lower than estimates contained in the preliminary debt sustainability analysis published in July 2015 (that projected a peak of public debt near 200% in 2016 and a gradual decline to 165% in 2020, Source: IMF, Greece: Preliminary Draft Debt Sustainability Analysis, June 26, 2015), since the actual costs of bank recapitalization were 5.4 billion, as compared to an earmarked envelope of 25 billion (Source: European Stability Mechanism ESM, Press Releases, December 1, 2015 and December 8, 2015). The debt burden remains very high and its projected trajectory indicates a very slow decline in outstanding debt levels in coming years. In this respect, the euro area countries have re-assured their commitment to implement additional debt-mitigating measures that would be granted only once the Greek authorities have demonstrated their commitment to reform and achieve the other fiscal targets of the economic adjustment program (Source: Hellenic Republic request for stability support in the form of an ESM loan, 10 July 2015). Greece benefits from very low debt servicing in the period up to 2021 due to low interest rates, the interest deferral and a long grace period on both Greek Loan Facility Agreement (GLF) and EFSF loans, which translate into average annual gross financing needs of 10.4% of GDP for the period. However, there are concerns that gross financing needs will exceed 15% of GDP for a number of years looking forward 3

4 which is the threshold that according to recent IMF guidance is among the key conditions necessary for gauging debt sustainability. Additionally, the debt dynamics remain vulnerable to changes in the basic macroeconomic assumptions (i.e. the primary fiscal surpluses and the economic growth rates), hence significant uncertainty remains. The Institutions argue that a substantial re-profiling, such as a long extension of maturities of existing and new loans, interest deferral, and long-term financing at AAA rates would allow to cater for these concerns and uncertainty from a gross financing requirements perspective, though they would still leave Greece with very high gross debt-to-gdp levels for an extended period. In this respect, the Euro Summit statement of July 13, 2015 offered an agreement to consider a debt restructuring after the first positive assessment of the new program implementation: the Eurogroup stands ready to consider, if necessary, possible additional measures (in the form of longer grace and payment periods) aiming at ensuring that gross financing needs remain at a sustainable level. Nonetheless, the statement explicitly rules out an outright debt restructuring The Euro Summit stresses that nominal haircuts on the debt cannot be undertaken. The Greek banking system remained in deleveraging mode with the pace of annual contraction in lending to private sector accelerating moderately in the second half of 2015 to 2.0% year-over-year in December, with loans to households contracting by 3.1% year-over-year (compared with a decline of total credit to private sector of 1.7% year-over-year in June 2015). Corporate credit declined by 1.2% year-over-year in December 2015 compared with -0.7% year-over-year in June 2015 (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016). Credit growth to private sector weakened further in the first two months of 2016 (-2.3% year-on-year), mainly due to deterioration in credit to non-financial corporations (-1.6% year-on-year) (Source: Bank of Greece, Press Release, Bank credit to the domestic private sector, February 2016). Total bank deposits have stabilized since the imposition of capital controls in July 2015 and increased by 1.2 billion, cumulatively, until December 2015, supported by a normalization in government spending, which had been partly transmitted to the private sector, inflows of EU funds and favorable seasonal factors. However, total bank deposits remain 46.4 billion lower than their level of December 2014 (Source: Bank of Greece, Bulletin of Conjunctural Indicators, January-February 2016). Accordingly, the Greek banking system s financing from the Eurosystem decreased to billion in December 2015 and by 19.1 billion cumulatively since June 2015, with the Emergency Liquidity Assistance (ELA) dependence contracting by 17.9 billion in this period (Source: Bank of Greece, Monthly Balance Sheet, June 2015 and December 2015) and decreasing further by 0.9 billion in January-February 2016 (Source: Bank of Greece, Monthly Balance Sheet, February 2016). As discussed above, the macroeconomic environment in Greece between end-2014 and Q was impacted by a series of events that resulted in the imposition of capital controls and the activation of the third financial support programme, in particular, increasing uncertainty and deteriorating macroeconomic conditions in the first semester of 2015, along with protracted negotiations between the new Greek Government (elected on January 25, 2015) and official creditors on the continuation of, or transition to, a new program of financial support. Rising domestic liquidity constraints and the absence of external financing to the Hellenic Republic amplified uncertainty over the Greek Government's ability to meet its domestic obligations, including sizeable upcoming repayments on both official (IMF and ECB) and marketable debt in the period June-August Uncertainty peaked in late-june, when an agreement with the official lenders had still not been reached and, as a result, the existing support programme expired and a referendum was called in the relation to the conditions which underlying the agreement on the activation of a new program of financial support. Financial markets, which priced in an unsuccessful end to negotiations, pushed Greek Government bond yields into credit event territory in late-june and early-july when the Greek governments delayed the repayment of maturing debt to the IMF ( 1.5 billion to the IMF on June 30, which was subsequently cleared) due to the absence of sufficient external financing. Accordingly, the Governing Council of the ECB decided to maintain the ELA ceiling for the Greek banking sector unchanged (at the June 26, 2015 level) (Source: ECB, Press Release, June 28, 2015), effectively inhibiting any additional access by Greek banks to Eurosystem financing in a period of accelerating deposit withdrawals. 4

5 In response to the fear of an outright bank run, the Greek government imposed a bank holiday on June 28, 2015 that lasted until July 19, and applied specific restrictions on banking and other financial transactions of Greek citizens and legal entities (jointly referred to as capital controls, Source Bank of Greece, Act of Legislation, June 28, 2015), with a view to protecting financial and macroeconomic stability. Moreover, in view of the severe economic and financial disturbance that appeared to threaten the continued membership of the Hellenic Republic in the European Monetary Union and the EU, the Greek government officially requested financial assistance from the European Union on July 10, 2015 (Source: European Commission s proposal for a council implementation decision on granting short term Union financial assistance to Greece under a new program from the European Stability Mechanism (ESM)). A third Program was subsequently agreed with creditors in August 2015, in order to restore the sustainability of public finances and to continue participating in the Eurozone, and Greece pledged to implement an ambitious program of structural and fiscal reforms. The Eurogroup on July 16, 2015 (Source: Eurogroup statement, July 16, 2015) on the basis of a positive assessment by the Institutions, decided to grant in principle a three-year ESM-based program of financial support to Greece. On August 19, 2015, following the Eurogroup Statement of August14, 2015 (Source: Eurogroup statement, August 14, 2015), the Board of Governors of the ESM approved the proposal for a Financial Assistance Facility Agreement (FFA) with Greece (Source: ESM Statement, August 19, 2015), and adopted a Memorandum of Understanding (MoU) with Greece (Source: European Commission, August 19, 2015), specifying the relevant national procedures, on the successful implementation of which the total amount of financial assistance will depend. On August 20, 2015, the first sub-tranche of 13 billion of the new programme was disbursed for covering budget financing and debt servicing needs of the Greek state; 10 billion in ESM notes have been made immediately available for bank recapitalization and resolution purposes. The activation of this financial support programme for Greece between July and mid-august 2015 is estimated to secure Greece s solvency until 2018 (Source: European Commission). Following the agreement and legislation of two additional sets of prior actions, the Greek government received another 3 billion related to the first program instalment, in two sub-tranches in November and December (Source: ESM Statements, November 23, December 22, 2015). This funding has been used to cover external debt servicing needs and contributed to a normalization of government spending and to the clearance of about 0.5 billion of Government arrears to the domestic private sector (Source: Ministry of Finance, December 2015). The completion of the comprehensive assessment of Greek systemic banks on October 30, 2015 identified a system-wide shortfall of 4.4 billion in the baseline scenario and 14.4 billion in the adverse scenario of the stress test. The official sector has participated in the recapitalization through the Hellenic Financial Stability Fund (HFSF) with only 5.4 billon compared with initial estimates of up to 25 billion with the participation of private investors limiting further the use of earmarked program funding (Source: ESM, December 8, 2015). Against this backdrop, the 10-year Greek government bond spreads over the German bund, which are often used as a proxy of the trajectory of the country-specific risk, declined to 8.7% in H2:2015 from 10.4% in H1:2015 along with the gradual decline in uncertainty that accompanied the agreement on the new financial support program for Greece in July However, intensifying international headwinds since end-2015 and rumors of a delayed completion of the pending first program review in late-2015 and early 2016 pushed the yields on Greek 10-year sovereign bond yields higher in January-February 2016 (by 143 bps to 10.4% on average, in February 2016), following a steady decline between July and December 2015 (a cumulative fall in 10-year GGB yields of 520 bps) (Source: Bloomberg database). Overall, most of the core macroeconomic indicators showed a better than expected performance in H2:2015 with forward looking indicators (such as business confidence indicators and the PMI) registering a steady improvement until early 2016 from the trough of Q3:2015. These factors led to a positive revision of Greek GDP growth forecast for 2016 by the EU Commission in February 2016, when they projected an annual recession of -0.7% year-over-year for FY:2016 (compared with previous estimates of -1.3% year-over-year, Source: EU Commission, Autumn forecast, November 2015). 5

6 The above developments resulted in the upgrade of Greek sovereign debt by the main rating agencies: S&P raised their rating by two notches to CCC+ on July 21, 2015, while Fitch upgraded Greek debt by one notch to CCC, on August 18, On September 22, 2015, Moody's maintained Greece's sovereign rating at Caa3 but changed the outlook to stable from negative as it had placed the country s rating on review for further downgrade since July 1, Finally, S&P Ratings upgraded Greek debt by one notch to B- on January 22, 2016 with a stable outlook, referring to the milder than expected recession and progress made in fiscal and reform targets of the Program as the key determinants of its rating decision (Source: Bloomberg database). Prospective investors are referred generally to information appearing on the website of the Ministry of Finance of Greece and the reports of the IMF and EU Commission (please see or (English version), and Description of National Bank of Greece S.A. The text of the section National Bank of Greece S.A. at page 58 of the Information Memorandum shall be substituted in its entirety by the following text, which shall be deemed to be incorporated in, and form part of, the Information Memorandum: National Bank of Greece S.A. (the Issuer or Bank) was founded in 1841 and incorporated as a company limited by shares (anonimi eteria) pursuant to Greek law as published in the Greek Government Gazette No. 6 on 30 March 1841 (registered number /B/86/01). Its current corporate form will expire on 27 February 2053 but may be further extended by a resolution of the General Meeting of Shareholders. The Bank is domiciled in Greece. The Bank s headquarters and its registered office are located at 86 Eolou Street, Athens, Greece and its telephone number is The Bank and its consolidated subsidiaries (together, the Group) comprise a diversified financial services group engaged in a wide range of banking, financial services, insurance, stock-brokerage and finance-related activities throughout the Hellenic Republic and internationally. The Bank has been listed on the Athens Exchange (ATHEX) since Until the establishment of the Bank of Greece, the central bank, in 1928, the Bank was also responsible for issuing currency. Until the late 1980 s, in common with other Greek banks, the Bank operated in a highly regulated environment, which significantly influenced its lending and investment activities. As at 31 December 2015, the Group s total assets were 111,232 million compared to 115,212 million (as restated) on 31 December 2014, loans and advances to customers were 45,375 million compared to 68,109 million, and due to banks and due to customers (total deposits) were 68,125 million compared to 87,155 million as at the same dates. As at 31 December 2015, the Group s total equity was 9,824 million, consisting of 9,099 million equity attributable to NBG shareholders and non-controlling interest of 725 million. As at 31 December 2015, the Bank operated throughout Greece through 527 branches (including one premium branch in Golden Hall) and one private banking unit, and an international network comprising 1,199 branches outside the Hellenic Republic (including foreign subsidiaries and Bank branches in the United Kingdom, Egypt and Cyprus). The Bank has nine commercial banking subsidiaries operating in Turkey, Bulgaria, Romania, FYROM, Serbia, Albania, Malta, Cyprus and South Africa. The Bank s share capital is broadly dispersed across individuals and legal entities in Greece and abroad. As at the date of this Supplement, the Bank s outstanding issued share capital amounted to 2,744,145,458.10, divided into 9,147,151,527 common shares of a par value of 0.30 each. In accordance with the Euro Summit Statement of 12 July 2015 and ECB Decision of 5 August 2015, the ECB conducted a comprehensive assessment of the four systemic Greek banks, including NBG, in This comprehensive assessment, by taking into account the positive impact of the third quarter results of 6

7 2015, identified a 1,456 million Baseline Scenario Shortfall and a 4,482 million Adverse Scenario Shortfall. To address these capital shortfalls, the Bank undertook a number of capital actions to raise its CET1 capital. These capital actions were set out in a Capital Plan, which was submitted to the SSM and approved on 13 November Actions contemplated by the Capital Plan were required to be completed by 11 December 2015 for the capital created thereby to qualify to address the Baseline Scenario Shortfall or Adverse Scenario Shortfall, as applicable. The Capital Plan included the following actions, that were completed in December 2015: a liability management exercise ( LME ) consisting of offers to eligible holders of seven series of its outstanding debt and capital securities; an International Offering and; a Greek Public Offer (as further described below). Due to the fact that the above measures in the aggregate did not fully address the Adverse Scenario Shortfall, the Bank applied for state aid ( State Aid ). As such State Aid was approved and provided to the Bank, the HFSF subscribed for contingent convertible securities ( CoCos ) (in a principal amount equal to 75% of the amount of State Aid provided) and new shares (in respect of the remaining 25%). Consistent with the EU state aid rules, State Aid was provided after the application of certain burden sharing measures. Additionally, the Capital Plan includes the sale of the Group s entire stake in Finansbank (although the sale was not required to be and the Bank did not expect to be completed by December 11, 2015). On 21 December 2015, Bank s Board of Directors approved the divestiture to Qatar National Bank of NBG s 99.81% stake in Finansbank A.Ş. together with other minor direct and indirect interests. In the context of the implementation of the Capital Plan, as stated above, on November 17, 2015, the Extraordinary General Meeting of the Bank s shareholders approved: a) the reverse split of the ordinary shares at a ratio of 15 existing shares of 0.30 Euro per share to be exchanged for 1 new share of 4.50 Euro per share and the reduction of the number of shares from 3,533,149,631 to 235,543,309, b) the reduction in the nominal value from 4.50 Euro per share to 0.30 Euro per share, with the formation of a special reserve of an equal amount for offsetting losses, and c) the share capital increase by 4,482 million in the context of recapitalization of the banks pursuant to the provisions of Greek Law 3864/2010, as amended, and Cabinet Act 36/ through cancellation of the pre-emptive rights to existing shareholders, by issuing new ordinary shares, through In-Cash Contribution and/or In-Kind Contribution including the issuance of a convertible bond loan through the issuance of unsecured, perpetual and subordinated bonds, contingently convertible into ordinary shares of the Bank. On December 9, 2015 the Bank s Board of Directors confirmed that the total share capital increase was partially covered, in accordance with art. 13a of Company Law 2190/1920, i.e. it was covered by 2,192,372, through the issuance of 7,307,907,231 new shares. In the same meeting the Bank s Board of Directors further certified that the aforementioned partial coverage is divided as follows: A. increase by the amount of 457,455, that was covered in cash by issuing 1,524,851,811 new shares in the context of the International Offering; B. increase by the amount of 299,955, that was covered in cash by issuing 999,852,461 new shares in the context of the Greek Public Offer, 7

8 C. increase by the amount of 694,906,185 that was covered in cash by the participants in the LME offeringand issuing thereby 2,316,353,950 new shares, D. increase by the amount of 63,593, that was covered by contribution in kind that entailed the mandatory conversion to new shares of liabilities of the Bank pursuant to the Cabinet Act no 45/ and the issuance thereunder in favor of the relevant beneficiaries of the aforementioned liabilities (excluding the beneficiaries of the preference shares of the Bank existing at that time) of 211,979,849 new shares; E. increase by the amount of 676,460,748 that was covered by the HFSF contributing to the Bank notes of the European Stability Mechanism (the ESM Notes) and issuing 2,254,869,160 New Shares, in accordance with art. 7 of Greek Law 3864/2010 and Cabinet Act no 36/ Due to the issuance of Cabinet Act no 45/ all of the Bank s preference shares were mandatorily converted (in accordance with the relevant provisions of article 6a of Greek law 3864/2010) to 1,603,700,987 common shares of the Bank. More specifically, all the outstanding non-cumulative, nonvoting, redeemable preference US shares (i.e. 12,639,831) were converted into 298,700,987 ordinary shares and all the 270,000,000 outstanding preference shares issued in favor of the Hellenic Republic, in accordance with the Greek Law 3723/2008 were converted into 1,305,000,000 ordinary shares. Furthermore, the Bank s Board of Directors in its meeting on December 8, 2015, decided, acting within the context of the relevant decision of the November 17, 2015 Extraordinary General Meeting of the Bank s shareholders, the issuance of a convertible bond loan of a total amount of 2,029,200,000 by issuing 20,292 contingent convertible bonds, of nominal value and subscription price of 100,000 each (the COCOs) which were all acquired by the HFSF, in accordance with par. 2 and 5c of Greek Law 3864/2010, Cabinet Act no 36/2015 and Greek Law 3156/2003, each as currently applicable. Following the execution of the relevant Subscription Agreement and the Bond Loan Program concluded between the Bank and the HFSF, the Bank s Board of Directors in its meeting on December 9, 2015 certified the contribution of ESM Notes valued at 2,029,200,000 that fully covered the amount of the aforementioned bond loan, pursuant to the evaluation of such notes, in accordance with art. 7 par. 3 of Greek Law 3864/2010, as applicable. Following all the above, if the amount by which the total share capital increase has been partially covered as above, in accordance with the relevant rules of Company Law 2190/1920, is added to the amounts by which the Group s regulatory capital of Common Equity Tier 1 has been enforced, namely by means of: (a) the mandatory conversion of the Bank s preference shares of article 4 indent xlvii of the Bank s Articles of Association, (b) the capital gain deriving from the Securities Exchange Offer and (c) the issuance and full coverage of the COCOs by the HFSF, the resulting total amount is higher than the Bank s capital shortfall under the Adverse Scenario, in accordance with the relevant decision of the SSM (i.e. 4,482 million). The Bank is incorporated with limited liability and is subject to regulation and supervision by the Bank of Greece. The Bank s common shares are listed on the ATHEX. National Bank of Greece shares were previously also be listed on the New York Stock Exchange (NYSE) in the form of American Depositary Receipts (ADRs). On November 27, 2015 NYSE Regulation Inc. determined that NBG was no longer suitable for listing based on abnormally low price levels of NBG's Common share ADRs, pursuant to Section d of the NYSE listed company manual, defining as such a price level of USD 0.15 per ADR. As a result, NYSE Regulation Inc. commenced delisting procedures which followed an immediate suspension of the ADR trading. The ADR currently trades at the Over the Counter market, while NBG maintains an option to relist the ADR in the future. To the extent that there is any inconsistency between (a) any statement in this Supplement and (b) any other statement in or incorporated by reference in the Information Memorandum, the statements in (a) above will prevail. 8

9 Save as disclosed in this Supplement, no other significant new factor, material mistake or inaccuracy relating to information included in the Information Memorandum, as supplemented by the Supplements, has arisen or been noted since the publication of the Information Memorandum. 9