Infra Banking Experts - Kommunalkredit Austria AG

KOMMUNALKREDIT AUSTRIA 

Covered Bond Roadshow 

September 2013 

INFRA BANKING EXPERTS 

EXCELLENCE IN INFRASTRUCTURE FINANCE

Agenda 

• Business model & market environment 

• Financial results 1H 2013 

• Portfolio and Funding 

• Covered Bond 

• Annex 


EXCELLENCE IN INFRASTRUCTURE FINANCE 

2

Infra Banking Experts 

„Kommunalkredit remains a competent partner for the municipal infrastructure “ 

(Alois Steinbichler, CEO) 

OWNERSHIP STRUCTURE: 

• 2009 demerger and split of former Kommunalkredit Austria AG 

into Kommunalkredit Austria AG and KA Finanz AG 

REPUBLIC OF 

AUSTRIA 

99.78% 

0.22% 

• Total assets EUR 14.6 bn as of 30 June 2013 

• Austria`s number two public sector covered bond issuer with 

a volume of EUR 4.9 bn covered bonds outstanding 

Ratings FITCH MOODY‘S 

COVERED BOND - Aa2 

LONGTERM A Baa3 

RATINGS* 

SHORTTERM F1 P-3 

FINANCIAL STRENGTH - E 

OUR MISSION: 

Kommunalkredit leads projects in Social Infrastructure, 

Energy, Environment and Transport to sustainable success 

Republic of Austria 

Longterm* 

*S&P: AA+ (stable) 

AAA (stable) 

Aaa (negative) 



3

Sectors and customers 

Energy & 

Environment 

Social 

Infrastructure 

Transport 

• Energy supply 

• Renewable sources of energy 

• Water supply and disposal 

• Waste management and disposal 

• Schools, universities, libraries 

• Hospitals & care homes 

• Police and court buildings, 

law enforcement facilities 

• Administrative buildings 

• Other public facilities 

• Roads, bridges, tunnels 

• Rail-based transport 

• Airports 

• Public transport 

• Transport systems 

CUSTOMER GROUPS 

• Public sector authorities 

• Special-purpose entities 

• Public-sector enterprises 

• Utilities 

• Private infrastructure 

developers and operators 

Infrastructure 

consulting 

• Strategic advisory 

• Transaction advisory for 

infrastructure projects 



4

Milestones 1958 - 2013 

1958 

Foundation 

3 November 2008 

Republic of Austria: 99.78% 

31 March 2011 

Restructuring plan approved by the 

European Commission 

24 July 2012 

Kick- off privatisation 

27 November 2009 

16 May 2013 

19 July 2013 

Split into: 

Kommunalkredit Austria AG 

KA Finanz AG 

Implementation of new business model 


Privatisation process not 

concluded on the basis of 

offers submitted 

Amendment decision of the 

European Commission 

1958 

2009 

2010 

2011 2012 2013 

Extraordinary Shareholders Meeting on 13 August 2013 approves European Commission 

amendment decision of 19 July 2013: 

• KA will not engage in new financing business 

• KA will continue to fully service existing transactions and outstanding commitments 

• KA will continue to fund itself independently, incl. existing customer deposits and capital market transactions 

• KA will maintain and expand consultancy business 

• Activities of subsidiaries incl. Kommunalkredit Public Consulting (KPC) and Kommunalnet will be maintained 

• Partial privatisation of Kommunalkredit still possible 



5

Austrian economy / operating environment 

• AT economy outperforming the EU 

positive GDP growth 

lowest unemployment rate 

public debt below EU average 

• Maastricht conformity: balanced budget 

in 2016 according to stability pact 

GDP growth in % 

Unemployment rate in % 

“GEMEINDEFINANZBERICHT” 2012: 

• Lowest level of new borrowing since 2001: 

EUR 961 mn 

• Municipalities generating negative income 

further declined by 485 to 646 

• Municipal investments decreasing by 9.2% 

to EUR 1.52 bn 

• Maastricht-surplus of AT municipalities: 

EUR 420 mn 

Dynamics of total expenses deducted 

from total income for all muicipalities** 

(excl. Vienna) 

Public debt in % of GDP 

2012 

** Total income less new borrowing; Total expenses less redemptions 

Source: Kommunalkredit Gemeindefinanzbericht 2012, Statistik Austria, OeNB August 2013 



6

Agenda 





• Annex 



7

Development of business 1H 2013 

• IFRS result before tax: EUR -5.6 mn 

• Adjusted IFRS result before tax: EUR 18.3 mn 

• IFRS result after tax: EUR -16.8 mn 

• Adjusted IFRS result after tax: EUR 13.8 mn 

IFRS result 

in Euro mn 

• IFRS result impacted by three negative one-off effects 

totalling EUR -33.2 mn: 

 

 

 

EUR -19.7 mn negative interest effect (debtor warrant claim) 

EUR -9.3 mn tax loss carry forward write-off following 

amendment decision of the European Commission 

EUR -4.2 mn valuation of derivatives (IFRS 13 and OIS) 

16.3 

12.3 

+12.2% 

18.3 

+12.3% 

13.8 

• Balanced result after tax pursuant to local GAAP: 

EUR 0.0 mn after releasing EUR 13.2 mn general risk provisions* 

-5.6 

• EUR 60.5 mn loan disbursements 1H 2013; 

EUR 232.6 mn commitments remaining 

-16.8 

1H 2012 1H 2012 1H 2013 1H 2013 

• Kommunalkredit Public Consulting: 

12,000 project applications processed 

EUR 189 mn support disbursements** 

EUR 1.3 bn underlying investments 

International consulting projects with EBRD and EU 

IFRS result before tax 

IFRS result after tax 

adjusted 

adjusted 

„Kommunalkredit: solid operating performance undisputed “ 

EUR -33.2 mn negative one- off effects included 1H 2013 result 

* Financial statements prepared in accordance with the Austrian Company Code/ Austrian Banking Act; general risk provisions pursuant to § 57(1) Austrian Banking Act 

** Made available by the government and federal states 



8

P&L positions 1H 2013 

• Net interest income: EUR -7.5 mn 

(one-off items, higher funding costs, lower new business) 

Revenue split 

in Euro mn 

• Net fees & commissions unchanged at EUR 7.5 mn 

support scheme management, consultancy services 

• Net trading and valuation result positive at EUR 15.6 mn 

10.9 

7.5 

19.8 

 

EUR +12.6 mn; balance sheet restructuring and 

redemption of own issues 

27.2 

15.6 

7.5 

 

EUR +3.3 mn; valuation gains on fair value portfolio 

7.5 

12.2 

 

EUR -4.2 mn; one-off valuation charges (IFRS 13 and OIS) 

-7.5 

• General administrative expenses: EUR -22.9 mn (+/-0% yoy) 

EUR 4.8 mn service level fees charged to KA Finanz included 

in „other operating income“ 

• Stability tax (Austrian bank levy): EUR 4.6 mn 1H 2013; 

total amount paid since 2011: EUR 21.3 mn 

1H 2012 1H 2013 1H 2013 adjusted 

Net interest income Net fee and commission income 

Net trading and valuation result 

„Kommunalkredit: solid operating performance undisputed “ 

Income adjusted for one-off items positive 



9

Capital and balance sheet 

• Continuing high capital ratios 

• Total Capital Ratio: 18.6% (+120 bp ytd) 

• Tier 1 Ratio: increased to 13.7% (+140 bp ytd) 

RWA in Euro mn 

2,216.9 2,164.1 

1,905.1 

-12% 

ytd 

Own Funds* in Euro mn 

395.5 397.6 384.6 

-3.3% 

ytd 

• Total assets: EUR 14.6 bn (-8.0% ytd) 

scheduled redemptions of loans and securities 

balance sheet optimisation measures 

• Loan volume outstanding: EUR 10.2 bn 

30.06.2012 31.12.2012 30.06.2013 

Capital Ratios in % 

16.9 

30.06.2012 31.12.2012 30.06.2013 

17.4 

18.6 

+ 120 bp 

ytd 

• RWA: EUR 1,905.1 mn or -12.0% ytd 

• Consolidated own funds: EUR 384.6 mn (-3.3% ytd) 

• Consolidated core Tier 1 capital: EUR 282.0 mn 

incl. participation capital: EUR 138.4 mn 

15.0 

12.0 12.4 12.3 

13.7 

+ 140 bp 

ytd 

• IFRS Equity: EUR 288.2 mn 

31.12.2011 30.06.2012 31.12.2012 30.06.2013 

Tier 1 Ratio Total Capital Ratio 

KA Framework will meet conditions Basel III parameters in line with applicable EU and EBA as of requirements 

1 January 2014 

* Austrian Banking Act 

INFRA BANKING EXPERTS EXCELLENCE IN INFRASTRUCTURE FINANCE 

10

Outlook: 

• Amendment decision of the European Commission (EC) of 19 July 2013: 

no income from new asset-side business 

• KA will not require liquidity or capital support from the Republic of Austria 

assuming stable planning parameters; liquidity and capital support could 

be provided without new state aid approval from the EC 

• KA‘s consulting activities for municipal and infrastructure projects will 

be continued and expanded 

• Budgetary constraints on public households will lead to increasing demand 

for project based solutions in public infrastructure 

• Positive revenue trend in second half of 2013 will not fully compensate 

negative one-off effects of 1H 2013 

• From 2014 onwards return to positive IFRS results is anticipated 



11

Agenda 





• Annex 



12

Fundingstructure and liquidity 

• Funding without government support 

• EUR 1.0 bn GGB redeemed on schedule on 8 July 2013 

(pass-through function for KA Finanz; KA‘s association with 

debtor warrant structure is terminated) 

• Capital market funding outstanding EUR 8.2 bn 

• Covered Bonds are major refinancing source 

(EUR 4.9 bn outstanding as of 30 June 2013) 

• EUR 110 mn Euro Senior Unsecured private placements in 

„Schuldscheinformat“ issued 1H 2013 

Fundingstructure in % 

12% 

4% 

11% 

43% 

13% 

17% 

Covered Bonds 

Senior Unsecured 

Loans 

Customer Deposits 

Money Market 

ECB Tender 

• Institutional customer deposits: EUR 1.7 bn ; +6.7% ytd 

(insurance companies, pension funds, investment 

managers, municipalities, public sector entities) 

• EUR 346 mn bond redemptions 1H 2013 

(1H12: EUR 1,455.5mn) 

• Positive liquidity effect from balance sheet optimisation: 

EUR 388.4 mn 1H 2013 

• Covered Bond maturities will be replaced in 

new benchmark size of EUR 500 mn 

Framework KA Covered conditions Bond EUR in 1 line bn maturing with EU and on 10 EBA September requirements 2013 

Figures as of 30.06.2013, GGB redeemed on 8 July 2013 



13

Asset quality 

• Broad customer base in municipal and public-near sector 

61% Austrian municipalities 

24% local authorities and public sector customers 

outside Austria mostly Germany and Switzerland 

• NPL Ratio 0.0% 

• 68% of total exposure is rated AAA/AA 

• 65% is located in Austria 

• 26% is EU- 27 

• Non EU: below 10% (mainly Switzerland) 

• EUR 161.7 mn or 1.3% of exposure to countries under EU 

support schemes o/w EUR 49.2 mn direct sovereign exposure 

• Average rating (capital weighted) of total portfolio : AA- 

(acc. to S&P rating scale) 

• General risk provision for banking risks: EUR 29.5 mn 

(acc. to Austrian Banking Act: §57 (1) BWG) 

Exposure by Rating 

6.6% 

9% 

16% 

Exposure by Geography 

8.8% 0.2% 

8% 

18% 

68.4% 

65% 

AAA/ AA 

A 

BBB 

Agenda 





• Annex 



15

Legal Framework 

Austrian Covered Bonds 

Pfandbriefe 

Fundierte 

Bankschuldverschreibungen 

Hypothekenbankgesetz 

(Mortgage Bank Act 1899) 

Pfandbriefgesetz 

(Pfandbrief Act 1927) 

Fundierte 

Bankschuldverschreibungen 

Gesetz (FBSchVG; 

Covered Bond Act 1905) 

Erste Group Bank 

Bank Austria 

Österreichische Landes-Hypothekenbanken 

Kommunalkredit 

BAWAG 

Raiffeisen 

Österreichische Volksbanken AG 

• The three Austrian legislative acts are equal to a large extent 

• FBSchVG additionally accepts as cover assets „gilt-edged“ securities 

• Legal harmonisation to be expected in 2014 

• 50% of public sector Covered Bonds outstanding pursuant to FBSchVG, are issued by KA 

Total volume outstanding: EUR 9.9 bn, KA: EUR 4.9 bn 

Source: www.pfandbriefforum.at 



16

Fundierte BSchV equal to DE Pfandbriefen 

Criteria 

Austria 

(Fundierte BSchV) 

Germany (Pfandbriefe) 

Special Covered Bond 

Legislation 

Yes 

Yes 

Cover Pool & Cover 

Register 

Yes 

Yes 

• No fundamental differencies 

in legal framework 

Trustee/Cover Pool Monitor 

Yes 

Yes 

Reporting Duties to the 

Supervisory Authority 

Present Value 

Overcollateralisation 

Mandatory Minimum 

Overcollateralisation 

Legal Framework for 

Bankruptcy 

Geographical Scope 

Yes 

Yes 

(if in articles of incorp. e.g. KA) 

Yes 

Yes 

EEA and Switzerland 

Yes 

Yes 

Yes 

Yes 

EEA, Switzerland, USA, Canada, 

Japan and Multilateral 

Development Banks 

 

 

 

Geographical scope of cover pool 

assets is restricted to Europe in AT 

Mandatory overcollateralisation on an 

present value in Germany; in AT only 

if included in the banks articles of 

incorporation 

Obligation to provide mandatory overcollateralisation 

on a present value is 

included in KA‘s articles of 

incorporation 

Specific Licence Required 

Yes 

Yes 

National Regulators and 

Supervisors 

FMA 

BaFin 

Source: www.ecbc.eu 



17

Public sector cover pool of KA (1/3) 

• Covered bonds outstanding in EUR mn: 4,890 

• WAL covered bonds:* 3.5 

• Number of issues 14 

• Cover pool assets in EUR mn: 6,910 

• WAL cover pool:* 8.7 

• Number of cover pool assets: 1,944 

• Covered bond rating Moodys: 

Aa2 

• Number of borrowers: 1,051 

• Nominal overcollateralisation: 41.3% 

• Committed overcollateralisation: 28% 

• Ø Vol. cover pool assets in EUR mn:** 3.5 

• Fixed rate assets: 76.2% 

• TPI Moodys: 

HIGH 

• NPL cover pool assets: 0.0% 

Cover pool by rating 

scaled by Moodys 

Currency mix, 

mn 

12% 

3% 

26% 

AAA 

AA 

A 

Double collateralised: 22% 


Cover Pool by Sector 

18% 

2% 

20% 

Sovereign 

Federal State 

• 100% Public sector assets 

• 22% „double collateralised“ 

2% 

Municipality 

• 81% Austria 

19% 

39% 

Sovereign (guaranteed) 

Federal State (guaranteed) 

Municipality (guaranteed) 

• 9% Suisse and 7% Germany 

• ECB eligibility: 56% 

Cover Pool by Geography 

• Transparency provisions: 

9% 

7% 

2% 1% 

Austria 

www.kommunalkredit.at: 

Switzerland 

Germany 

Italy 

81% 

Others 

Figures as of 30.06.2013 



19


Aa2 rating by Moodys with committed 

overcollateralisation of 28% 

6.9 mn. 

overcollateralisation: 41.3 % 

4.9 mn 

Cover 

Pool 

Covered 

Bonds 

Figures as of 30.06.2013 

EUR benchmark covered bonds Kommunalkredit Austria 

ISIN Issue Date Maturity Volume in mn Coupon ASW (Mid)** 

• XS0176120268 03-Sep-03 10Y Sep 2013 1,000 4.5% -16 

• XS0286031777 01-Feb-07 7Y Feb 2014 1,000 * 4.125% -6 

• XS0212122534 02-Feb-05 10Y Feb 2015 1,000 3.5% +4 

• XS0592235187 15-Feb-11 5Y Feb 2016 500 3.5% +11 

* Outstanding EUR 863 mn; ** Valuation as of 29.08.2013 - Source: Bloomberg 



20

ASW Mid 

ASW Mid 

Secondary market 

Austria: EUR benchmark covered bonds 

30 

25 

20 

15 

10 

5 

- 

-5 

-10 

-15 

0 1 2 3 4 5 6 7 8 9 

Maturity 

KA BAWAG BACA Erste Bank Hypo NOE VORARLB. LND-HYPO RLB NOE 

• Attractive yields in 

comparision with Austrian 

covered bond issuers 

• Austria is a active covered bond 

market with liquid secondary 

market in Core EU 

20 

10 

Comparables: Sovereigns and German covered bonds 

• Still high pick ups compared to 

Sovereigns and German 

issuers 

- 

-10 

-20 

0 1 2 3 4 5 6 7 8 9 

Maturity 

-30 

-40 

-50 

-60 

KA pbb MUEHYP Rep. Austria Rep. Germany 

Source: Bloomberg 



21

Why Kommunalkredit covered bonds 

• Premium quality cover pool (Aa2 rating Moodys) 

• 85% of cover pool is AAA/ AA rating 

• 81% of cover pool is Austria 

• Committed overcollateralisation of 28% 

(current overcollateralisation of 41.3% as of 30.06.2013) 

• Protection scheme by one of the most stringent 

covered bond laws in the EU 

• Frequent issuer 

Building up a liquid reference curve with new benchmark issues 



22

Agenda 





• Annex 



23

Exposure central states and territorial authorities 

The existing exposure to central states, territorial authorities and government-guaranteed positions in 

countries of the euro area (EU-17) is broken down as follows: 

of which to of which 

30-06-2013 Risk-relevant of which to 

territorial governmentguaranteed 

exposure central state 

authorities 

in EUR million 

Republic of Austria 6,635.9 1,283.3 5,303.1 49.5 

Federal Republic of Germany 803.9 0.0 775.0 28.9 

Republic of Italy 324.5 243.8 80.7 0.0 

Kingdom of the Netherlands 119.9 0.0 0.0 119.9 

Kingdom of Spain* 81.8 20.8 61.0 0.0 

Republic of Slovenia 70.0 0.0 0.0 70.0 

Republic of Portugal* 49.9 0.0 49.9 0.0 

Republic of Cyprus* 30.0 28.4 0.0 1.6 

Kingdom of Belgium 19.1 0.0 19.1 0.0 

*) state under EU support measures 


24

IFRS balance sheet Kommunalkredit Group* 

Assets in EUR 1,000 30-06-2013 31-12-2012 

Cash and balances with central banks 570,232.2 393,518.6 

Loans and advances to banks 911,289.9 1,169,735.9 

Loans and advances to customers 7,365,843.3 8,013,544.0 

Assets at fair value 3,045,585.1 3,210,216.0 

Assets available for sale 436,593.7 474,358.5 

Assets held to maturity 275,644.1 363,675.7 

Derivatives** 742,751.1 1,011,332.9 

Investments in associates 1,938.7 1,797.4 

Property, plant and equipment 29,526.2 30,060.8 

Investment property 0.0 5,493.4 

Intangible assets 396.0 541.2 

Current tax assets 51.2 37.1 

Deferred tax assets 15,756.3 32,341.5 

Other assets*** 1,188,550.6 1,145,731.9 

Assets 14,584.158.4 15,852,384.9 

Liabilities and equity in EUR 1,000 30-06-2013 31-12-2012 

Amounts owed to banks 2,681,388.6 3,001,514.3 

Amounts owed to customers 1,734,474.1 1,625,638.6 

Derivatives** 1,594,236.0 2,034,820.8 

Securitised liabilities 8,168,184.0 8,784,261.8 

Subordinated liabilities 84,736.3 88,281.8 

Provisions 10,358.7 10,231.2 

Current tax liabilities 4,803.4 2,716.9 

Other liabilities 17,812.0 16,470.4 

Equity 288,165.1 288,449.1 

of which subscribed capital 225,337,1 225,337.1 

of which capital reserves 8,973.6 8,973.6 

of which AFS reserve / cash flow hedge reserve -40,688.6 -57,277.3 

of which statutory reserves 27,805.7 27,805.7 

of which other reserves (incl. result for the period) -71,768.9 -54,909.9 

of which participation capital 138,373.3 138,373.3 

of which non-controlling interests 132.9 146.5 

Liabilities and equity 14.584,158.4 15.852.384.9 

* Includes Kommunalkredit Public Consulting GmbH (fully 

consolidated), Kommunalkredit Beteiligungs- und Immobilien 

GmbH (fully consolidated) and Kommunalleasing GmbH (included 

at equity). 

** Mostly interest-rate swaps, interest-rate/currency swaps and 

currency forwards concluded to hedge interest-rate and currency 

risks. The bank has no proprietary trading portfolio. 

*** Includes the debtor warrant claim against the Republic of 

Austria in the amount of TEUR 1,139,985.2 (31-.2.2012: 

TEUR 1,137,127.9) due on 8 July 2013. 


25

IFRS income statement Kommunalkredit Group 

01-01-2013 – 01-01-2012 – 

Income Statement in EUR 1,000 30-06-2013 30-06-2012 

Interest and similar income 336,910.3 453,218.6 

Interest and similar expenses -344,390.4 -426,041.2 

Net interest income* -7,480.1 27,177.4 

Loan impairment charges 278.0 -5,585.2 

Fee and commission income 8,045.5 8,166.7 

Fee and commission expenses -554.9 -712.3 

Net fee and commission income 7,490.6 7,454.4 

Dividend income 0.0 6.6 

Income from investments in associates 14.2 50.8 

Net trading and valuation result 15,638.3 10,937.3 

of which interest-related revaluation 1,352.2 -5,542.1 

of which spread changes in fair value portfolio 1,928.9 -1,776.6 

of which early redemption of own issues 9,327.7 27,874.6 

of which realisation of securities, loans and derivatives 3,239.5 -11,807.5 

of which other -210.2 2,188.8 

General administrative expenses -22,888.2 -22,881.1 

of which personnel expenses -14,687.0 -14,310.9 

of which other administrative expenses -8,201.2 -8,570.2 

Other operating income 5,908.5 5,202.5 

of which income from services invoiced to KF 4,838.3 5,080.3 

Other operating expenses -4,645.2 -6,015.6 

of which bank stability tax -4,622.9 -4,622.9 

Other operating result 1,263.3 -813.2 

Result for the period before tax -5,556.9 16,347.0 

Taxes on income** -11,281.5 -4,072.1 

Result for the period after tax -16,838.4 12,274.8 

of which attributable to owners -16,859.1 12,254.2 

of which attributable to non-controlling interests 20.7 20.6 

* includes EUR -19.7 million negative effect from debtor warrant structure 

** includes EUR -9.3 million write-off of capitalised losses carried forward according to IAS 12 due to amending decision of the European Commission of 19 July 2013 (discontinuation of new business) 


26

Overcollateralisation commitment 

Commitment regarding an overcollateralisation of covered bonds 

Covered bonds (further the “Notes” or ”Covered Bonds”) issued by Kommunalkredit Austria AG (“Kommunalkredit“) are secured by a cover pool 

pursuant to (i) the Austrian Law on Covered Bonds of Banks (Gesetz über fundierte Bankschuldverschreibungen, ”FBSchVG“) dated 27 December 

1905, RGBl 1905/213 (as amended) and (ii) paragraphs 22 – 24 of the Articles of Association of Kommunalkredit. Kommunalkredit is obliged to 

designate assets to cover the Covered Bonds and to satisfy claims arising out of these Notes from the designated assets (security) ahead of other 

claims. By virtue of a contract, dated 27 January 2011, (the “Agreement”) Kommunalkredit has committed to provide an over-collateralisation of its 

outstanding Covered Bonds which exceeds the requirements of paragraph 1 section 8 of the FBSchVG. Kommunalkredit has decided to take this step 

in order to meet the requirements of Moody’s Investors Services Inc. (“Moody’s“) for maintaining the ”Aa1” rating. By means of the over-collateralisation 

Kommunalkredit further strengthens security of its Covered Bonds. However, Kommunalkredit is convinced that even without such a commitment 

Kommunalkredit’s Covered Bonds grant a high extend of security to its investors. 

The agreement substantially stipulates the following provisions: 

Kommunalkredit undertakes for the benefit of the holders of the Notes, that for as long as the rating of the long-term, unsecured, unsubordinated debt 

obligations of Kommunalkredit as assigned by Moody’s Investors Services Inc. (“Moody’s“) is less than “A3“, it will within 90 Business Days upon 

execution of this Agreement ensure that the nominal value of the assets in the cover pool shall exceed the aggregate principal amount of the Notes in 

circulation, for which cover is to be provided in accordance with the FBSchVG, by an agreed minimum percentage of 28 per cent. For the avoidance of 

doubt, the nominal value of the assets in the cover pool will thus equal 128 per cent. of the aggregate principal amount of the Notes in circulation. 

Upon availability of a rating agency confirmation by Moody’s, Kommunalkredit may reduce the over-collateralisation percentage accordingly provided 

that the Notes are assigned a rating of ”Aa1” or better at the time of such reduction. For the avoidance of doubt, Kommunalkredit is under no obligation 

to maintain the current rating of the Notes of ”Aa1”. 

In addition, Kommunalkredit is entitled to increase the maximum over-collateralisation percentage of 28 per cent. unilaterally at any time. 

The Agreement shall automatically lapse in the event that the rating of the long-term, unsecured, unsubordinated debt obligations of Kommunalkredit as 

assigned by Moody’s is at least ”A3” or the Covered Bonds of Kommunalkredit cease to be rated by Moody’s. 

In the case of any merger, de-merger or transfer to another party (save where such transfer is made to a party which is an affiliate) of all or substantial 

parts of Kommunalkredit’s assets or business, Kommunalkredit shall have the right to terminate the Agreement with a notice period of 3 months. 

The Agreement is a genuine agreement for the benefit of third parties within the meaning of paragraph 881 of the Austrian General Civil Code 

(Allgemeines Bürgerliches Gesetzbuch) entered into for the benefit of the holders of the Notes. Each noteholder is entitled to assert claims under the 

Agreement against the issuer Kommunalkredit. 

All notices concerning the Agreement, in particular notices with regard to a lapse of this Agreement, shall be published by Kommunalkredit on its 

webpage. 

The German text of this notice shall be controlling and binding. The English language translation is provided for convenience only. 

Vienna, 27 January 2011 

KOMMUNALKREDIT AUSTRIA AG 

Source: Kommunalkredit Homepage/ Investor Relations/ Funding/ Covered Bonds 



27

Contact / Disclaimer 

This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, 

any securities of Kommunalkredit Austria AG, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection 

with, any contract or investment decision. 

There may be forward looking statements in this presentation. Such statements are based on current expectations and are subject to a number of 

risks and uncertainties that could cause actual results and performance to differ materially from any expected future results or performance, express 

or implied, by the forward looking statements. Factors that might cause forward looking statements to differ materially from actual results include, 

among other things, regulatory and economic factors. Kommunalkredit Austria AG assumes no responsibility to update any of the forward looking 

statements contained herein. 

No representation or warranty, express or implied, is made or given by or on behalf of Kommunalkredit Austria AG or its directors, officers or 

employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation. None of 

Kommunalkredit Austria AG or any of its directors, officers or employees nor any other person accepts any liability whatsoever for any loss 

howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith. 

Kommunalkredit Austria AG, Türkenstraße 9, A-1092 Wien 

www.kommunalkredit.at 

Bloomberg/Reuters: KA 



Kommunalkredit Austria AG 

Tuerkenstrasse 9, A-1092 Vienna 

Tel.: +43 (0)1/31 6 31-0 

Fax: +43 (0)1/31 6 31-505 

www.kommunalkredit.at

Infra Banking Experts - Kommunalkredit Austria AG

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