Second Supplement to the Debt Issuance Programme Prospectus Dated 11 August 2017

Transcription

1 Second Supplement to the Debt Issuance Programme Prospectus Dated 11 August 2017 This document constitutes a supplement (the "Second Supplement") in accordance with Art. 16 of the Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003, as amended (the "Prospectus Directive") to the two base prospectuses of Kommunalkredit Austria AG dated 7 April 2017, each as amended by the Supplement to the Debt Issuance Programme Prospectus dated 20 June 2017 (the "First Supplement"), which are: (i) the base prospectus of Kommunalkredit Austria AG in respect of non-equity securities within the meaning of Art. 22 No. 6 (4) of the Commission Regulation (EC) No. 809/2004 of 29 April 2004, as amended (the "Commission Regulation"), and (ii) the base prospectus of Kommunalkredit Austria AG in respect of covered bonds (non-equity securities within the meaning of Art. 22 No. 6 (3) of the Commission Regulation) (together, the "Debt Issuance Programme Prospectus" or the "Prospectus"). Kommunalkredit Austria AG EUR 800,000,000 Debt Issuance Programme (the "Programme") Kommunalkredit Austria AG (the "Issuer") has requested the Commission de Surveillance du Secteur Financier (the "CSSF") in its capacity as competent authority under the Luxembourg act relating to prospectuses for securities (Loi relative aux prospectus pour valeurs mobilières), which implements the Prospectus Directive, to provide the competent authorities in the Republic of Austria, the Federal Republic of Germany, the United Kingdom of Great Britain and Northern Ireland, the Republic of Ireland and The Netherlands with a certificate of approval attesting that this Second Supplement has been drawn up in accordance with the Luxembourg act relating to prospectuses for securities ("Notification"). The Issuer may request the CSSF to provide competent authorities in additional host Member States within the European Economic Area with a Notification. Terms defined or otherwise attributed a particular meaning in the Prospectus have the same meaning when used in this Second Supplement. This Second Supplement shall only be distributed along with the Prospectus. This Second Supplement and the Prospectus should be read in conjunction with all documents incorporated by reference therein, which together, constitute a prospectus for the purposes of the Prospectus Directive, and in the case of a particular issue or tranche of Notes, in conjunction with any applicable Final Terms. To the extent that there is any inconsistency between (a) any statement in this Second Supplement and (b) any other statement in, or incorporated by reference in, the Prospectus prior to the date of this Second Supplement, the statement in (a) will prevail. Save as disclosed in this Second Supplement, there has been no other significant new factor, material mistake or inaccuracy relating to information included in the Prospectus since the publication of the First Supplement. This Second Supplement will be published in the same way as the Prospectus. This Second Supplement and the document incorporated by reference in the Prospectus via the Second Supplement are available for viewing in electronic form on the website of the Luxembourg Stock Exchange (< and on the website of the Issuer (< respectively < This Second Supplement is valid as long as the Prospectus is valid. INVESTORS WHO HAVE ALREADY AGREED TO PURCHASE OR SUBSCRIBE FOR THE NOTES BEFORE THIS SECOND SUPPLEMENT IS PUBLISHED HAVE THE RIGHT, EXERCISABLE WITHIN TWO WORKING DAYS AFTER THE PUBLICATION OF THIS SECOND SUPPLEMENT, I.E. 16 AUGUST 2017, TO WITHDRAW THEIR ACCEPTANCES.

2 2 RESPONSIBILITY STATEMENT Kommunalkredit Austria AG, with its registered office in Vienna, is solely responsible for the information given in this Second Supplement. The Issuer hereby declares that, having taken all reasonable care to ensure that such is the case, the information contained in this Second Supplement is, to the best of its knowledge, in accordance with the facts and contains no omission likely to affect its import. SUPPLEMENTAL INFORMATION Kommunalkredit Austria AG has been informed on 25 July 2017 by Moody s Deutschland GmbH, that it has upgraded the ratings assigned to the outstanding public-sector covered bonds (Fundierte Bankschuldverschreibungen) issued by Kommunalkredit Austria AG to Baa1. Furthermore the unaudited financial statements of the Issuer for the first half-year 2017 were published on 4 August 2017 as well as a new member of the Supervisory Board has been elected on 24 July In light of these developments the Prospectus shall be amended as follows: 1) In the chapter "Summary", in the element B.12, on page 9, the following new section shall be included after the end of subsection "Selected historical key financial information": "Source: Half-Year Financial Report 2017 of Kommunalkredit Group, pages 15 and 16 in EUR 1, June June 2017 Total assets 3,862, ,348,683.3 Liabilities 3,587, ,070,247.8 Equity 274, ,435.5 Net interest income 18, ,221.6 Consolidated net profit 27, ,935.4 " 2) In the chapter "Summary", in the element B.12, on page 9, the subsection "Significant change in the financial and trading position" shall be replaced in its entirety by the following: "Not applicable. There has been no significant change in the financial and trading position of the Issuer since 30 June 2017." 3) In the chapter "Summary", in the element B.17, on page 11, in the subsection "Credit Ratings of the Issuer or its debt securities", the disclosure information and its associated footnotes, which were amended in the Prospectus through the First Supplement, shall be replaced by the following:

3 3 "Kommunalkredit Austria AG is rated by Standard & Poor s Credit Market Services Europe Ltd. ("S&P") 1,2, Moody's Deutschland GmbH ("Moody's") 3,2 and DBRS Ratings Limited ("DBRS") 4,2. As of the date of this Prospectus the ratings are as follows: S&P 5 : Moody's 5 : DBRS 5 : covered bonds: A (outstanding) covered bonds: Baa1 (outstanding) Issuer Rating: BBB (low) long-term debt and deposit: BBB (low) short-term debt and deposit: R-2 (middle) [The Notes are expected to be rated as follows [ ].] [Not applicable. The Notes are not rated.] 1 S&P is established in the European Community and is registered under Regulation (EC) No 1060/2009 of the European Parliament and of the Council of 16 September 2009 on credit rating agencies, as amended (the "CRA Regulation"). 2 The European Securities and Markets Authority publishes on its website ( a list of credit rating agencies registered in accordance with the CRA Regulation. That list is updated within five working days following the adoption of a decision under Article 16, 17 or 20 CRA Regulation. The European Commission shall publish that updated list in the Official Journal of the European Union within 30 days following such update. 3 Moody s is established in the European Community and is registered under the CRA Regulation. 4 DBRS is established in the European Community and is registered under the CRA Regulation. 5 A credit rating assesses the creditworthiness of an entity and informs an investor therefore about the probability of the entity being able to redeem invested capital. It is not a recommendation to buy, sell or hold securities and may be revised or withdrawn by the rating agency at any time." 4) In the chapter "German Translation of the Summary Zusammenfassung", in the element B.12, on page 25, the following new section shall be included after the end of subsection "Ausgewählte wesentliche historische Finanzinformationen": "Quelle: Halbjahresfinanzbericht 2017 der Kommunalkredit-Gruppe, Seiten 15 und 16 in Tausend EUR 30. Juni Juni 2017 Gesamtvermögen , ,3 Verbindlichkeiten , ,8 Eigenkapital , ,5 Zinsüberschuss , ,6 Konzernergebnis für das Halbjahr , ,4 " 5) In the chapter "German Translation of the Summary Zusammenfassung", in the element B.12, on page 25, the subsection "Signifkante Veränderungen in der Finanz- bzw. Handelsposition" shall be replaced in its entirety by the following: "Nicht anwendbar. Seit dem 30. Juni 2017 hat es keine signifikanten Änderungen der Finanzposition der Emittentin gegeben."

4 4 6) In In the chapter "German Translation of the Summary Zusammenfassung", in the element B.17, on page 27, in the subsection "Kreditratings der Emittentin oder ihrer Schuldtitel", the disclosure information and its associated footnotes, which were amended in the Prospectus through the First Supplement, shall be replaced by the following: "Die Kommunalkredit Austria AG wird von Standard & Poor s Credit Market Services Europe Ltd. ("S&P") 1,2, Moody's Deutschland GmbH ("Moody's") 3,2 sowie von DBRS Ratings Limited ("DBRS") 4,2 bewertet. Zum Datum dieses Prospekts lauten die Ratings wie folgt: S&P 5 : Moody's 5 : DBRS 5 : fundierte Anleihen: A (aushaftend) fundierte Anleihen: Baa1 (aushaftend) Emittentenrating: BBB (niedrig) langfristige Schuldverschreibungen und Einlagen: BBB (niedrig) kurzfristige Schuldverschreibungen und Einlagen: R-2 (mittel) [Es wird erwartet, dass die Schuldverschreibungen wie folgt gerated werden: [ ].] [Nicht anwendbar. Die Schuldverschreibungen sind nicht gerated.] S&P hat seinen Sitz in der Europäischen Gemeinschaft und ist gemäß der Verordnung (EG) Nr. 1060/2009 des Europäischen Parlaments und des Rates vom 16. September 2009 über Ratingagenturen, in der jeweils gültigen Fassung (die "Ratingagentur-Verordnung") registriert. Die Europäische Wertpapier- und Marktaufsichtsbehörde veröffentlicht auf ihrer Webseite ( ein Verzeichnis der nach der Ratingagentur- Verordnung registrierten Ratingagenturen. Dieses Verzeichnis wird innerhalb von fünf Werktagen nach Annahme eines Beschlusses gemäß Artikel 16, 17 oder 20 der Ratingagentur-Verordnung aktualisiert. Die Europäische Kommission veröffentlicht das aktualisierte Verzeichnis im Amtsblatt der Europäischen Union innerhalb von 30 Tagen nach der Aktualisierung. Moody s hat seinen Sitz in der Europäischen Gemeinschaft und ist gemäß der Ratingagentur-Verordnung registriert. DBRS hat seinen Sitz in der Europäischen Gemeinschaft und ist gemäß der Ratingagentur-Verordnung registriert. Ein Kreditrating ist eine Einschätzung der Kreditwürdigkeit einer Rechtsperson und informiert den Anleger daher über die Wahrscheinlichkeit mit der die Rechtsperson in der Lage ist, angelegtes Kapital zurückzuzahlen. Es ist keine Empfehlung Wertpapiere zu kaufen, zu verkaufen oder zu halten und kann jederzeit durch die Ratingagentur geändert oder zurückgenommen werden." 7) In the chapter "Kommunalkredit Austria AG", on page 57, in the section "3. Management and Administrative Bodies", at the end of the table which indicates the names and functions of the members of the Supervisory Board in subsection "3.2 Supervisory Board", the following new line as well as an associated footnote shall be included: "Martin Rey 12 Member 12 Mr. Martin Rey is Managing Director of Maroban GmbH and Babcock & Brown GmbH."

5 5 8) In the chapter "Kommunalkredit Austria AG", on page 59, in the section "7 Financial Information concerning Kommunalkredit s Assets and Liabilities, Financial Position and Profits and Losses", at the end of the subsection "Selected Financial Information (in accordance with IFRS)" the following new subsection shall be included: "Selected Financial Information Half Year (in accordance with IFRS) Consolidated Balance Sheet (in EUR 1,000) As of As of 30 June June 2017 Total assets... 3,862, ,348,683.3 Amounts owed to banks , ,589.8 Amounts owed to customers , ,141.1 Liabilities... 3,587, ,070,247.8 thereof securitised liabilities... 2,287, ,236,578.6 Equity , ,435.5 Consolidated Income Statement (in EUR 1,000) From 1 January From 1 January to 30 June 2016 to 30 June 2017 Net interest income... 18, ,221.6 Net fee and commission income... 7, ,773.6 Net trading and valuation result... 31, ,431.1 Consolidated profit for the year before tax... 34, ,835.8 Consolidated net profit... 27, ,935.4 Consolidated Cash-Flow Statement (in EUR 1,000) From 1 January From 1 January to 30 June 2016 to 30 June 2017 Cash-flow from operating activities , ,751.2 Cash-flow from investing activities Cash-flow from financing activities , ,576.6 The complete unaudited financial statements of Kommunalkredit Group for the first half-year 2017, including Consolidated Balance Sheet, Consolidated Income Statement, Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated Interim Financial Statements are incorporated by reference in this Prospects." 9) In the chapter "General Information", on page 365, in the subsection "Credit Rating", the information and the associated footnotes provided therein, which were amended in the Prospectus through the First Supplement, shall be replaced in its entirety by the following: "Credit Rating Kommunalkredit Austria AG is rated by Standard & Poor s Credit Market Services Europe Ltd. ("S&P"), Moody's Deutschland GmbH ("Moody's") and DBRS Ratings Limited ("DBRS"). A rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning rating organisation. Each of Moody's and DBRS is established in the European Community and is registered under Regulation (EC) No

6 6 1060/2009 of the European Parliament and of the Council of 16 September 2009 on credit rating agencies, as amended (the "CRA Regulation"). 1 S&P assigns issuer ratings according to its general long-term and short-term scales. S&P ratings scale for long-term debt obligations ranges from AAA (highest quality, lowest level of credit risk) to C (lowest rated and typically in default, with little prospects for recovery of principal or interest). The ratings from AA to CCC may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories. Moody's assigns issuer ratings according to its global long-term rating scales. Moody's ratings scale for long-term debt obligations ranges from Aaa (highest quality, lowest level of credit risk) to C (lowest rated and typically in default, with little prospects for recovery of principal or interest). Moody's appends numerical modifiers 1, 2 or 3 to each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of the generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates ranking in the lower end of the generic rating category. DBRS assigns issuer ratings according to its long-term obligations scale and commercial paper and short-term debt rating scale. DBRS long-term rating scale ranges from AAA (highest credit quality) to D (Default). All rating categories other than AAA and D also contain subcategories (high) and (low). The absence of either "(high)" or "(low)" designation indicates the rating is in the middle of the category. DBRS commercial paper and short-term debt rating scale ranges from R-1 (high) (highest credit quality) to D (Default). The R-1 and R-2 rating categories are further denoted by the subcategories "(high)", "(middle)" or "(low)". As of the date of this Prospectus the following ratings were assigned to the Issuer: S&P 2 : Moody's 2 : DBRS 2 : covered bonds: A 3 (outstanding) covered bonds: Baa1 4 (outstanding) Issuer Rating: BBB (low) long-term debt and deposit: BBB (low) 5 short-term debt and deposit: R-2 (middle) The European Securities and Markets Authority publishes on its website ( a list of credit rating agencies registered in accordance with the CRA Regulation. That list is updated within five working days following the adoption of a decision under Article 16, 17 or 20 CRA Regulation. The European Commission shall publish that updated list in the Official Journal of the European Union within 30 days following such update. A credit rating assesses the creditworthiness of an entity and informs an investor therefore about the probability of the entity being able to redeem invested capital. It is not a recommendation to buy, sell or hold securities and may be revised or withdrawn by the rating agency at any time. An obligation rated A means that the Issuer s capacity to meet financial commitments is still strong but is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories. Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as such may possess certain speculative characteristics. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category. 5 Obligations rated BBB have an adequate credit quality. The capacity for the payment of financial obligations is considered acceptable. May be vulnerable to future events. 6 Obligations rated R-2 (middle) have an adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events or may be exposed to other factors that could reduce credit quality."

7 7 10) In the chapter "Documents incorporated by reference", on page 368, the following new paragraph shall be included after point 3): "4) Translation of the unaudited consolidated financial statements for the first half-year 2017 of the Issuer (included in the Half-Year Financial Report 2017 of Kommunalkredit Group) - Consolidated Balance Sheet, page 15 - Consolidated Income Statement, page 16 - Consolidated Statement of Comprehensive Income, page 17 - Consolidated Statement of Changes in Equity, page 19 - Consolidated Statement of Cash Flows, page 18 - Notes to the Consolidated Interim Financial Statements, pages Auditor s Report on the Review of Interim Condensed Consolidated Financial Statements, pages 31 32" Kommunalkredit Austria AG Tuerkenstrasse Vienna Austria