Reports on proposed resolutions.

Transcription

1 Reports on proposed resolutions. ONE: Examination and approval of the Annual Accounts (Balance Sheet, Profit and Loss Account, Statement of Net Assets, Statement of Cash Flow and Annual Report), Management Report, Proposed earnings distribution for Bankinter, S.A. results and the Accounts and Management Report of the Consolidated Group for the 2007 financial year. Proposed Resolution: Approval of the Annual Financial Statements (Balance Sheet, Profit and Loss Account, Statement of changes to net worth, Cash flow Statement, and Annual Report), and the Management Report for BANKINTER, S.A. and the BANKINTER Group corresponding to financial year 2007, in accordance with the terms in which the said Accounts and Reports have been formulated by the Board of Directors of BANKINTER, S.A. at their meeting held on 13 March 2008 and verified by the Audit and Compliance Committee and the opinion of the Accounts External Auditor has no reservations. The individual financial statements have been formulated in accordance with the accounting criteria and formats contained in Circular 4/2004 of the Bank of Spain. The consolidated statements comply with the International Financial Reporting Standards ("IFRS") even though they have also been formulated in accordance with the criteria and formats of the said Circular. The pre-tax profit of Bankinter Consolidated Group for 2007 amounted to 484,462 thousand euros and the net distributable profit 361,863 thousand euros, which represent an increase of 53.15% and 73.56% respectively compared to The pre-tax profit of Bankinter for 2007 amounted to 483,202 thousand euros and the net distributable profit 383,724 thousand euros, of which 118,827 thousand euros was set aside for dividends and 264,897 thousand euros was assigned to voluntary reserves. 1

2 Profit per share over the year has totalled 0.92 euros, showing an increase of 71.64% over the figure for the previous year. There follows below a summary of the distribution data for the Bankinter Consolidated Group and Bankinter S.A. earnings in financial year DISTRIBUTION OF EARNINGS 2007 BK GROUP Pre-tax profits 484,462 Corporation Tax 122,599 Group Earnings 361,863 Dividend 118,603 Voluntary reserves 243,260 Total 361,863 DISTRIBUTION OF EARNINGS 2007 BANKINTER, S.A. Pre-tax profits 483,202 Corporation Tax 99,478 Net profits 383,724 Dividend 118,827 Voluntary reserves 264,897 Total 383,724 Report The Annual Accounts and the various documents that make up the same in accordance with the Commercial Code, the Companies Act, and other applicable provisions, including the sectoral rules in force, have been formulated by the Board of Directors on the basis of a proposal from the Financial Management and the Chief Executive officer of the Group, verified by the Bankinter Audit and Compliance Committee, and submitted to an external audit by Deloitte S.L. with a favourable opinion was issued without any reservations. This year the Annual Accounts include, as documents forming a part thereof, a Statement of changes to net worth, and a Cash flow Statement. The Bankinter administrators have proceeded, in accordance with the new regulations (Royal Decree 1362/2007 of 19 October which 2

3 implements the Securities Market Act), to sign a statement of liability with regard to the accounts, both individual and consolidated, for financial year 2007, which has been made available to the shareholders together with the rest of the documents from the General Meeting. Furthermore, the Management Report for this year 2007 includes those matters referred to at Article 116 bis of the Securities Market Act. The corporate website, contains the full corporate Annual Report for the 2007 financial year of which they form part, and the Legal Report, the so-called Commercial Report or Management Report with extensive information on results, businesses, segments, networks, technology, products, quality, human-resources management, own funds, shares and other matters, the Annual Corporate Governance Report, the Annual Corporate Social Responsibility Report, and the Annual Audit and Compliance Committee Report of Bankinter S.A.. TWO: Approval of the management of the Board of Directors and the payment of dividends for the 2007 financial year. Proposed Resolution: Approval of the management of the Board of Directors and of the Chairman and Chief Executive Officer during 2007, and ratification of the resolutions of the Board of Directors with regard to the approval and distribution of the dividends on account for The total gross dividend for 2007 is of euros per share, with an increase of 15% with regard to the dividend for the previous year. The Board of Directors may resolve to distribute dividends against earnings for 2008, pursuant to the provisions of the Companies Act. Report As in previous years, it is proposed that the Annual General Meeting should approve the management of the Company by the Board of Directors during 2007, including the distribution of dividends, the amount of which is set out in the resolution relating to the formulation of the accounts and the application of earnings. As usual, the proposal includes an authorization for the Board of Directors to distribute 3

4 dividends on account of profits during 2008, in accordance with Article 215 of the Companies Act. THREE: Ratification and re-election of Directors. Proposed Resolutions: THREE (ONE). Ratification of Gonzalo de la Hoz Lizcano To ratify the appointment to the position of Director of Bankinter S.A. of Gonzalo de la Hoz Lizcano, born on 14 April 1943, married, of Spanish nationality, with his professional address at Paseo de la Castellana 29, Madrid, and holder of ID Card No. 2,689,498-Q, for a term of four years, in accordance with the provisions of Article 138 of the Companies Act, Article 26 of the Corporate By-laws, and Article 10 of the Board Regulations. The appointment was unanimously approved by the Board of Directors at its meeting held on 13 February 2008 following a proposal by the Appointments and Remuneration Committee and following a favourable report by the Corporate Governance Committee. Gonzalo de la Hoz Lizcano, in attendance at the General Meeting, accepts the ratification of the appointment and confirms that he does not incur in any situation of legal incapacity, or specifically in any of those provided for in the Companies Act, Law 12/1995 of 11 May replaced by Law 5/2006 of 10 April governing conflicts of interest affecting members of the Government and Senior Officers of the General Administration of the State, and Law 14/1995 of 21 April of the Autonomous Region of Madrid. Gonzalo de la Hoz Lizcano is duly ratified in his capacity as an External Director. THREE (TWO). Ratification of Jaime Terceiro Lomba To ratify the appointment to the position of Director of Bankinter S.A. of Jaime Terceiro Lomba, born on 30 April 1946, single, of Spanish nationality, with his professional address at Paseo de la Castellana 29, Madrid, and holder of ID Card No. 35,217,995.G for a term of four years, in accordance with the provisions of Article 138 of the Companies Act, Article 26 of the Corporate By-laws, and Article 10 of the Board Regulations. The appointment was unanimously approved by the Board of Directors at its meeting held on 13 February 2008 following a 4

5 proposal by the Appointments and Remuneration Committee and following a favourable report by the Corporate Governance Committee. Jaime Terceiro Lomba, in attendance at the General Meeting, accepts the ratification of the appointment and confirms that he does not incur in any situation of legal incapacity, or specifically in any of those provided for in the Companies Act, Law 12/1995 of 11 May replaced by Law 5/2006 of 10 April governing conflicts of interest affecting members of the Government and Senior Officers of the General Administration of the State, and Law 14/1995 of 21 April of the Autonomous Region of Madrid. Jaime Terceiro Lomba is duly ratified in his capacity as an Independent Director. THREE (THREE). Re-election of José Ramón Arce Gómez To re-elect José Ramón Arce Gómez, born on 20 September 1941, married, of Spanish nationality, with his professional address at Paseo de la Castellana 29, Madrid, and holder of ID Card No. 628,059-K, as a Director of the Bank for a four-year term, and who is in attendance at the General Meeting, and accepts his re-election and declares that he does not incur in any situation of legal incapacity, or specifically in any of those provided for in the Companies Act, Law 5/2006 of 10 April governing conflicts of interest affecting members of the Government and Senior Officers of the General Administration of the State, and Law 14/1995 of 21 April of the Autonomous Region of Madrid. José Ramón Arce Gómez was appointed of Director on 17 April ratify by the General Meeting of 27 June and his last re-election was 23 March José Ramón Arce Gómez is duly re-elected in the same capacity of Independent Director as he currently holds. Report: The ratification of the two directors who have been nominated through the system for interim appointments on 13 February 2008, Gonzalo de la Hoz Lizcano and Jaime Terceiro Lomba, is proposed for a term of four years, in accordance with the provisions of the Bank s Corporate Bylaws and the Board of Directors Regulations. 5

6 Likewise the re-election for a four-year term provided for at Article 26 of the Corporate By-laws is proposed of the Director José Ramón Arce Gómez as a result of the expiry of his current term of office. A break-down of the professional profile of each one of the directors whose ratification or re-election is proposed is set out below, the number of company shares and share options they each hold: Gonzalo de la Hoz Lizcano Born in Graduate in Industrial Engineering and Information Technology at the Politécnica University of Madrid, Master s Degree in Electrical Engineering at the University of Texas. He held various positions of responsibility at IBM Spain, at IBM USA, and at IBM Europe, where he directed the Development of European Products for Banking and Insurance between 1985 and He was Director-General of Operations (Means) at Bankinter, where he has worked since He has been Managing Director of Línea Directa Aseguradora from May 1995 to February Gonzalo de la Hoz Lizcano holds, as at the date the 2007 annual accounts are formulated, 277,772 shares in Bankinter (direct and indirect), and he does not hold any option rights over shares in Bankinter. Gonzalo de la Hoz Lizcano is duly ratified in his capacity as an External Director. Jaime Terceiro Lomba Born in Ph.D. in aeronautical engineering at the Politécnica University of Madrid with extraordinary prize, and graduate in economic science at the Autónoma University of Madrid with extraordinary prize. Professor in Economic Analysis at the Complutense University of Madrid since 1980, and permanent academic at the Royal Academy of Moral and Political Science. 6

7 He has been Director-General of the Banco Hipotecario de España, an Independent Director of Unión Fenosa for eighteen years, and Chairman of its Audit Committee. For nine years as from 1988, he was Executive Chairman of Caja de Madrid and of its Financial Corporation. He has been an Independent Director at Sogecable since May 2000 and a member of its Executive Committee. He also sits on the Accenture Advisory Board and on the board of a number of foundations. Jaime Terceiro Lomba holds, as at the date the 2007 annual accounts are formulated, 2,120 shares in Bankinter (direct and indirect), and he does not hold any option rights over shares in Bankinter. Jaime Terceiro Lomba is duly ratified in his capacity as an Independent Director. José Ramón Arce Gómez Born in Graduate in Law at the Complutense University of Madrid. Graduate in Business Administration at E.O.I (1963), and Diploma in Marketing Management at Columbia University (1969). He pursued his professional career at LILLY, S.A. from 1963 to 2001, and was Managing Director from 1976 to 1995, and from 1992 to 2001 he was Chairman of the said company. Director of Faes Farma from 27 June 2002 and currently Chairman of Chester Investments SICAV, S.A.. José Ramón Arce Gómez holds, as at the date the 2007 annual accounts are formulated, 1,641,063 shares in Bankinter (direct and indirect), and 41,117 option rights over shares in Bankinter. José Ramón Arce Gómez is duly re-elected in his current capacity as Independent Director. FOUR. Authorisation for the Board of Directors to issue, either directly or indirectly, and to guarantee the issue of bonds, debentures, and fixed rate securities and general debt securities, convertible or exchangeable securities, preferred shares, mortgage-backed securities and other securities. 7

8 Proposed Resolution: 1. Issues of fixed and variable-return securities (other than shares), debt securities in general, convertible or exchangeable securities, and preference shares. To authorise the Board of Directors, with such restrictions as are set forth at section 4 below, to issue, either directly or indirectly through subsidiaries or special-purpose vehicles, in one or more goes, bonds, debentures, certificates, preference shares, promissory notes, warrants, and securities in general, of any kind, class, or type, with a fixed, variable, or linked interest rate, denominated in euros or in other currencies, which may be simple or with a guarantee of any kind (including mortgage-backed), ordinary or subordinated, convertible or into or exchangeable for shares, with or without rights, and in general, in any of the forms legally allowed in accordance with the regulatory provisions for the issue of fixed-income securities and other securities issues. 2. Issues of mortgage-backed securities and securitisations. To authorise the Board of Directors, with such restrictions as are set forth at section 4 below, to transfer and/or assign loans and credit facilities, with or without their corresponding guarantees, irrespective of the legal title, nature, and purpose thereof, owned by Bankinter or by any company of the Bankinter Group, and to issue with regard to the said loans and credit facilities, credit rights, or other assets, whether mortgage-backed or of any other sort, or with regard to the guarantees thereof, any securities provided for in the applicable legislation, and specifically, mortgage shares and mortgage transfer certificates, so that they may, although not necessarily, be included, acquired, grouped, or subscribed by one or more Mortgage-backed Securities Fund or Asset Securitisation Fund. Likewise, to authorise the Board of Directors so that it may, either directly or indirectly through subsidiaries or special-purpose vehicles, perform synthetic securitisation transactions, by way of such financial instruments as it may deem appropriate and convenient in each case, in accordance with the legislation in force at any given time. 3. Issue guaranty 8

9 To authorise the Board of Directors, with such restrictions as are set forth at section 4 below, to give a direct or indirect Bankinter S.A. guarantee, one or more times, to cover the issue of bonds, debentures, securities, and any other forms of debt, including convertible debentures or debentures exchangeable for shares, as well as for issues of preference shares, as indicated at point 1 above as approved by companies belonging to the Bankinter Group or which are partially owned by Bankinter S.A., by special-purpose vehicles, or issued by third parties and guaranteed by Bankinter S.A. or by any company belonging to the Bankinter Group. 4. Authorised limits The following limits are established for the whole of each one of the categories of issues and/or guarantees set forth below: 4.1. General debt and/or securities issues by Bankinter S.A. and/or companies belonging to the Bankinter Group, referred to at point 1, with the exception of the preference shares and convertible debentures and/or debentures exchangeable for shares referred to at point 4.2, with or without a direct or indirect Bankinter S.A. guarantee or surety: twenty-five thousand (25,000) million euros For issues of preference shares in Bankinter S.A. and/or in companies belonging to the Bankinter Group guaranteed by Bankinter S.A., a specific and independent limit of one thousand (1,000) million euros is established. For issues convertible debentures and/or debentures exchangeable for shares in Bankinter S.A. and/or companies of the Bankinter Group with or without a direct or indirect Bankinter S.A. guarantee or surety: one thousand five hundred (1,500) million euros The issue of Bankinter S.A. or Bankinter Group companies mortgage shares and/or mortgage transfer certificates, with or without a direct or indirect Bankinter S.A. guarantee or surety and in all the events provided for at section 2 above: sixteen thousand (16,000) million euros. The maximum limits set forth refer in all cases to the amount of the total current balance issued and in circulation corresponding to each one of the categories of issues referred to, and so the said limits are mutually independent. However in the case of point 4.3 above, the 9

10 limit is based on the total nominal amount issued starting as of the date of this General Meeting. In the case of issues of guaranties denominated in other currencies, the limits shall be calculated for the equivalent value in euros at the time it is executed. In the case of issues by companies that are unrelated to the Bankinter Group, but which are directly or indirectly guaranteed by Bankinter S.A., the limits provided for in this section shall be applicable. These limits shall remain in force during the term indicated at point 6 of this resolution, and in any event they may be amended by the next General Meeting. The programmes for the issue of bonds, debentures, and securities in general approved pursuant to authorisations granted by previous General Meetings, and issues performed chargeable to such programmes or without a programme, shall be subject to the new limits contained in this resolution, except in the case of point 4.3 above, and they shall remain in force under all circumstances. 5. Scope of the powers of the Board of Directors or the Executive Committee The Board of Directors or the Executive Committee shall determine, with the widest possible powers, the characteristics and the issue term for the securities issued and the remaining conditions for the issue or issues or for the issue guarantees including, as the case may be, the By-laws governing the relations between the Bank and Syndicate or Syndicates of Debenture-holders, bond-holders, or securities-holders, and in general, such acts as may be necessary or appropriate for the execution of this Resolution. In exceptional circumstances or in situations of urgency that are duly justified, the Board of Directors or the Executive Committee may authorise the issue of securities, the placement of approved issues, issue guarantees, or any of the transactions envisaged in this resolution, the value of which exceeds the limits laid down in this Resolution. Should the said excess be authorised, the Board of Directors must report on this at the first General Meeting held. Likewise, the Board of Directors or the Executive Committee may amend the profitability conditions and amortisation terms for the 10

11 issues and/or guarantees made pursuant to this authorisation, subject to legally-established requirements, and may apply for the listing or trading on official secondary securities markets, or on other organised on non-organised, official or non-official markets, and, as the case may be, whether any bonds, debentures, and other securities that may be issued pursuant to this Resolution shall remain thereon or withdraw from said markets. The Board of Directors or the Executive Committee may delegate the drafting of the resolutions and the execution of the public or private documents necessary or appropriate for the stated purposes to certain persons, either jointly or jointly and severally, as well as the applications for the necessary administrative authorisations, as the case may be, and the specification and amendment of the conditions and requirements of the issues and/or guarantees, including the extension of the limits thereon within the maximum limits authorised by this Resolution. 6. Term of the authorisations granted. The term of this authorisation granted to the Board of Directors and the Executive Committee is three years as from the date of this General Meeting, upon the expiry of which term the powers granted will be cancelled on account of having expired in so far as they have not been exercised. Report: The Resolution that is the subject of the proposal consists in authorisation routine at the General Meetings of limited companies so that the Board may issue and guarantee within the limits laid down by the Resolution itself issues of bonds and debentures, in general, pursuant to articles 282 et seq. of the Companies Act. For the issue of bonds, debentures, and securities in general, issued in accordance with registered programmes on the basis of authorisations granted by previous General Meetings, the application of the new limits is established, and in any event their validity is confirmed. The extension of the authorized limits has the aims of diversifying the company s sources of finance, optimizing the variety of debt instruments that Bankinter already uses, and ensuring the necessary 11

12 capacity in order to handle the growth in investment and in the company s transactions during the financial year, within the plan for the sustained increase in activity and in the Group s results in the coming years. FIVE. Authorisation for the Board of Directors to acquire, directly or indirectly, its own shares in accordance with the provisions of the Companies Act, including the express power of transfer them or reduce the amount of share capital to redeem treasury stock. Proposed Resolution: To authorise the Board of Directors of Bankinter S.A. so that it may perform derivative acquisition transactions for treasury shares, either directly or through any Group companies, in accordance with the Companies Act. The acquisitions may be carried out in any legal format and the par value of the acquired shares, in addition to those shares already held by the Bank and its subsidiaries, shall not exceed 5% of the Bank s share capital or such figure as may be legally admissible, without prejudice to those cases provided for under Article 77 of the Companies Act. For sale and purchase transactions carried out on an official secondary market, the acquisition prices shall be those corresponding to the stock market listed price of the treasury shares on the day on which the transaction is formalised. In the event of a purchase of treasury shares as a result of compliance with the duties provided for in resolutions or in options agreements, sale and purchases on instalments or the like, previously formalised by the Bank, including those that pertain to shares and convertible or exchangeable debentures, which have been or are to be allocated directly to administrators, managers, or employees of the Company, or arise as a result of the exercise of option rights held by the aforementioned, for which transactions this authorisation is also granted, and the applicable price shall be the price agreed in the resolution or the corresponding agreement. This authorisation is valid for eighteen months and covers all portfolio transactions carried out pursuant to its terms. The authorisation granted by the General Meeting held on 19 April 2007, in favour of the Board of Directors for the reduction of the corporate capital, in one or more goes, with the aim of amortising the treasury shares, within a term of eighteen months is hereby renewed, 12

13 and the Board of Directors is hereby to partially distribute the share issue-premium reserve in favour of the shareholders as a form of dividend payment or refund of contributions, as well as to alter the par value of the shares without increasing or reducing the corporate capital figure. Report: As in previous years, a routine proposal is presented before the General Meeting to authorise the Board to perform the derivative acquisition, whether directly or indirectly, of treasury shares in accordance with the provisions of Articles 75 et seq. of the Companies Act. Furthermore, and following the criterion of previous General Meetings, a renewal of the authorisation in favour of the Board of Directors to reduce the corporate capital is proposed, with the aim of amortising the treasury shares, within a term of eighteen months. Likewise the Board of Directors is authorised, within the said time limit, to reduce the corporate capital chargeable to free reserves by way of the reduction of the par value of the shares and to partially distribute the share issue-premium reserve in favour of the shareholders as a method of paying dividends or refunding of contributions, as well as in order to alter the par value of the shares without increasing or reducing the corporate capital amount. These authorisations the effective use of which by the Board is considered as being merely a possibility are in response to the common denominator of considering different decisions and measures aimed at optimising shareholders dividends, and the liquidity and management of the shares. SIX. Approval, in accordance with the provisions of the Companies Act, of Directors remuneration consisting of the delivery of shares, under the terms of the Corporate By-laws. Proposed Resolution: To approve, without prejudice of the remaining remunerations to be received by directors in 2008 all of them detailed in the remuneration policy report contained in point 8 of the agenda-, the part of the remuneration system for the Directors of the Bank for financial year 2008, consisting in the allocation of shares in accordance with the conditions set forth below, and ratifying with effect as from 1 January 2008 the resolution approved by the Board of Directors at its meeting 13

14 held on 19 December 2007, following the proposal by the Appointments and Remuneration Committee, in accordance with the provisions of Article 130 of the Companies Act, Article 32 of the Corporate By-laws, and Article 29 of the Board Regulations: - The free allocation of the shares in Bankinter S.A. to the Directors in one-fourth annual parts of like value, with an undertaking not to dispose of the shares allocated for as long as they hold the office of directors of the Bank. - Timescale for the plan for the allocation of shares: One year, with the last quarterly allocation of shares taking place in January 2009 or during the first quarter of The specific date for the allocation shall be determined by the Board of Directors or by the Executive Committee or shall be delegated to such entity or person as the Board may think fit, always within the said time limits. - Sum affected: In order to determine the amount to be invested in the allocation of shares, it is hereby agreed to use a point-based distribution system to award scores to the current officers sitting on the Board. Thus it is agreed that the Chairman of the Board is awarded 2 points, the Deputy Chairman is awarded 1.5 points, the Managing Director is awarded 1.5 points, and all other Directors are awarded 1 point. The point-based system could be modified if the Board considers appropriate. Once the distribution system has been established, it is agreed that the sum to be assigned to the allocation of shares per point and director is 25,000 euros per annum, which amounts a total of 300,000 euros taking into account the current composition of Bankinter Board of Directors (10 members). - The number of shares to be allocated in each quarter will depend on the quoted Bankinter share price on the allocation date to be determined, with the amount invested under all circumstances being as set forth above. Report: The Directors of Bankinter will be paid, for exercising office as members of the management body, an amount to be determined on an annual 14

15 basis and of which part will relate to allowances for attending Board meetings, fixed remuneration and gratuitous awards of shares. A proposal is put before the General Meeting for the ratification of the remuneration of the Directors, in that part which refers to allocations of shares by way of application of the provisions of Article 130 of the Companies Act to the effect that remuneration consisting in the allocation of shares or of option rights over shares or which is linked to the value of shares, shall be expressly provided for in the by-laws, and the application thereof shall require a resolution by the shareholders in General Meeting. The resolution sets global amounts to be invested in the plan for the allocation of shares, and the specific number of shares to be allocated depends on their quoted price on each one of the allocation dates. The term of duration of this remuneration system is of one year. This remuneration system is fully in compliance with the conditions and limits laid down at Article 32 of the Corporate By-laws and Article 29 of the Board of Directors Regulations. The Report on Remuneration Policy approved by the Board Directors, may be consulted by shareholders with the documents of the announcement, and contains the full remuneration policy approved for financial year 2008 and application of remuneration policy in financial year SEVEN. Authorisation of the Board of Directors, with powers of substitution, to formalize, interpret, rectify, and execute the resolutions approved by this Meeting. Proposed Resolution: The widest powers necessary at law in order to interpret, rectify, complete, and execute the Resolutions approved by the General Meeting and to substitute the powers granted by the General Meeting are hereby delegated to the Board of Directors, with express powers of replacement with regard to the Executive Committee or such Director or person as may be considered appropriate. Likewise with regard to the deposit of the annual accounts and the documents referred to at the Commercial Registry Regulations, the 15

16 Chairman, Pedro Guerrero Guerrero, the Chief Executive Officer, Jaime Echegoyen Enriquez de la Orden, and the General Secretary and the Secretary of the Board of Directors, Rafael Mateu de Ros Cerezo, are hereby conferred powers so that any one of them, indistinctly, may carry out such activities as may be necessary in order for the said deposit to take place, which includes the filing of applications at the Commercial Registry and the issue of any certificates. Powers are hereby conferred on the Chairman of the Board of Directors, the Chief Executive Officer, and the General Secretary and the Secretary of the Board of Directors, so that any one of them may engross in the form of a public deed the resolutions approved by the General Meeting at this session, and execute such public or private documents as may be necessary or convenient for the execution thereof, including the power to amend them to the extent necessary so that their content may concur with the classification of the Commercial Registry or of any administrative body or authority. Report: This is a routine resolution that grants the Board of Directors ordinary powers to properly execute resolutions taken by the General Meeting itself, including powers to formalize the deposit of the annual accounts. Advisory or information Points EIGHT. Report on the remuneration policy for directors. Report to be submitted to advisory vote: In accordance with the recommendations of the Spanish Unified Code of Good Corporate Governance published in March 2006, the Report on remuneration policy approved by the Board of Directors of Bankinter S.A. following the proposal of the Appointments and Remuneration Committee is submitted to advisory at this Meeting. This Report contains, inter alia, the following: Resolution on the remuneration policy approved by the Board of Directors Overall summary of the application of the remuneration policy for financial year 2007 Remuneration system for Directors for financial year

17 The role of the Appointments and Remuneration Committee in setting the remuneration policy. The complete text of the report is made available to the shareholders for consultation together with the rest of the documentation relating to the General Meeting. NINE. Information on the partial amendment of the Board of Directors Regulations in accordance with the provisions of Article 115 of the Securities Market Act. Aspects to be reported on at the Meeting: In accordance with Article 115 of the Securities Market Act, the amendments approved by the Board of Directors at its meeting held on 13 March 2008 to the Bankinter S.A. Board of Directors Regulations are duly reported on at the General Meeting. The amendments implies a fully compliance with the Unified Good Governance Code of listed Companies in force in Spain (UGGC), including in some cases practices that the company already done together with international practices more advanced in corporate governance. Apart from these technical amendments to adapt the text of the regulation of the Board of Directors to the UGGC, there are no substantial amendments. Articles amended: Article 4. Make-up Article 5. Essential powers Article 6. General functions Article 8. Requirements for the appointment Article 9. Independent Directors Article 11. Removal of the Directors Article 15. General duties of the directors Article 18. Conflict of interest and duties of general information Article 20. Rules of conduct in the securities market Article 21. Duties of information with regard to securities. Article 22. Exceptions. Article 24. Directors Remunerations. Article 25. Chairman. Article 27. Chief Executive Director Article 29. Call and agenda of the sessions. 17

18 Article 30. Quorum, proxies, and voting. Article 31. Minutes and certificates Article 32. Board of Directors Committees Article 34. Audit and Compliance Committee Article 35. Appointments and Remuneration Committee Article 36. Corporate Governance Committee The Bankinter S.A. Board of Directors Regulations were authorised at a meeting of the Board of Directors held on 18 June 2003 and notice was given to the General Meeting held on 23 March Since they were approved, they have been changed on several occasions and the General Meeting was informed at its meetings held on 21 April 2005, 20 April 2006, and 17 April 2007 of the said changes. Likewise, the Annual Corporate Governance Reports of Bankinter S.A., relating to the 2005, 2006, and 2007 financial years, include extensive information about the Board Regulations, the General Meeting Regulations and other matters regarding the company s Corporate Governance system. It is, therefore, pertinent, in accordance with the provisions of Article 115 of the Securities Market Act, to inform this Meeting about the changes made to the Board Regulations by the Board itself at its meeting held on 13 March Article 5 Essential powers of the Board of Directors, amended to include the necessary tabling at the Meeting of resolutions which entail the transformation of the Company, refinements with regard to the appraisal of the Board and its members, including the Chairman and the Managing Director in order to mention the participation in the appraisal process of a third specialized external party and the competence of the board to appoint or remove administrators and managers of subsidiary companies. The first two changes are a result of changes in order to comply with UGGC (Rec. 8). Article 6 General Functions of the Board of Directors, amended in order to avoid contradicting the powers included with regard to the appointment or removal of representatives at subsidiary companies, and the feature of being non-delegable is added with regard to those matters affecting the establishment of policies and strategies, in accordance with the recommendations of the UGGC (Rec.8.b)). 18

19 Article 8 Requirements for the appointment of Directors, amended in order to be able to establish guidance programmes in accordance with the qualities of the new directors, in order to provide them with sufficient knowledge with regard to the bank, all of which is in accordance with the recommendations of the UGGC (Rec. 25). Article 9 Independent Directors, amended in order to add the appraisal of the Chairman to the powers held by the Chairman of the Audit Committee, with the possibility of performing his/her functions by making use of a third-party specialized external firm (Rec. 17 UGGC ). Article 11 Removal of the Directors, amended in order to include the need for those directors who step down from office prior to the expiry of their term, to explain the reasons in a letter (Rec.34 UGGC ). Article 15 General duties of the directors amended to include the restriction laid down in the rules of credit institutions with regard to the number of boards on which a director of the bank may sit (Rec. 26 UGGC ). Article 20 Rules of conduct in the securities market includes a purely technical amendment (with reference to Article 2 of the Securities Market Act in order to determine those financial instruments which are subject to the restrictions of the Article) and amendments derived from changes made to the Bankinter Internal Code of Conduct, which directors are now expressly subject to, with questions having been eliminated from this Article in order to avoid duplication. The same reason justifies the amendments to Article 21. Duties of information with regard to securities and Article 22. Exceptions. Article 24 Directors remunerations, amended in order to include the advisory vote of the annual remuneration policy report in the General Meeting. 19

20 Article 34 Audit and Compliance Committee is amended in order to provide this Committee with additional powers in accordance with the Unified Code such as the examination of the reasons for the withdrawal of the auditor, should this arise, to favour the auditing of the accounts of all group companies that are obliged to audit its accounts by the auditor of the parent company, and to report in advance to the board on resolutions concerning the incorporation of companies or the performance of similar transactions. Likewise Article 35 Appointments and Remuneration Committee is amended to include provisions of the Unified Code of Good Governance concerning the non-existence of bias in the processes for the selection and prior reports in cases of the appointment or removal of representatives of the bank at subsidiary companies. This Committee shall be the one with powers to set the guidance programme for new directors. Other changes Other changes Likewise refinements have been included to Article 4 (cross references to other Articles of the Regulations and a mention of the status of Other Directors for those who do not comply with the definition of independent and who are not nominee directors), and technical changes to Article 8 Requirements for the appointment, 16 duties of confidentiality and secrecy, 18 Conflict of interest, 25 Chairman, 27 Managing Director, 29 Call and agenda of the sessions, 30 Quorum, proxies, and voting, 31 Minutes and certificates (electronic format and recording of concerns expressed), 32 Board of Directors Committees (deliberation by the Board of proposals drawn up by the committees) and 36 Corporate Governance Committee. Shareholders will find the text of the Regulations approved by the Board of Directors including the amendments set forth above on the corporate website. TEN. Presentation of the report explaining the items of the Management Report contained at Article 116 bis of the Securities Market Act. Aspects to be reported on at the Meeting: 20

21 The Company refers to the specific content of the report required by Article 116 bis of the Securities Market Act which has been made available to the shareholders, together with the rest of the documentation of this General Meeting, on the Bankinter corporate website, amongst others. Regarding this report it is mentioned that chapters refers to Capital structure, significant participations, restrictions on voting rights, shareholders agreements not contained in the by-laws and rules for the appointment and removal of administrators are already contained in the company Corporate Governance Report 2007, and there is no special information in the case of Bankinter. 21