COREALCREDIT BANK AG

European Economic Area; (iv) under certain circumstances the United States, Canada or
Switzerland and their national banks and regional administartions and political subdivisions in
these states; the European Central Bank and further claims as set out in the Pfandbrief Act
(Pfandbriefgesetz).
A Cover Pool may furthermore include the following assets: (i) equalisation claims converted into
bearer bonds; (ii) money claims against a suitable credit institution, in an amount up to 10 per cent.
of the aggregate principal amount of outstanding Public Sector Pfandbriefe, provided that the
share of money claims against any one credit institution does not exceed 2 per cent. of the
aggregate principal amount of outstanding Public Pfandbriefe; and (iii) any claims arising under
derivative transactions, as would qualify for a Mortgage Pfandbrief Cover Pool, subject to the
conditions and restrictions described above.
Insolvency Proceedings
In the event of the institution of insolvency proceedings over the assets of a Pfandbrief Bank, any
Cover Pool maintained by it would not be part of the insolvency estate, and, therefore, such
insolvency would not automatically result in the insolvency of a Cover Pool. Only if the relevant
Cover Pool were to become insolvent at the same time or thereafter would separate insolvency
proceedings be initiated against such Cover Pool by the BaFin. In this case, holders of Pfandbriefe
would have priority of claim over the assets of the respective Cover Pool. Their priority of claim
would also extend to any interest accrued after the commencement of insolvency proceedings.
Furthermore, but only to the extent that they suffer any loss, the holders of Pfandbriefe would also
have recourse to any assets of the Pfandbrief Bank not included in the Cover Pools. As regards
such assets, holders of the Pfandbriefe would rank equally with other unsecured and
unsubordinated creditors of the Pfandbrief Bank.
In the case of the insolvency of the Pfandbrief Bank, one or two administrators (Sachwalter –
"Administrator") will be appointed to administer each Cover Pool for the sole benefit of the
holders of Pfandbriefe. The Administrator(s) will be appointed by the court having jurisdiction at the
location of the head office of the Pfandbrief Bank upon request of the BaFin before or after the
institution of insolvency proceedings. The Administrator(s) will be subject to the supervision of the
court and of the BaFin with respect to the duties of the Pfandbrief Bank arising in connection with
the administration of the assets included in the relevant Cover Pool. The Administrator(s) will be
entitled to dispose of the assets in the Cover Pool and receive all payments on the relevant assets
to ensure full satisfaction of the claims of the holders of Pfandbriefe. To the extent, however, that it
is obvious that such assets are not necessary to satisfy the claims of Pfandbrief holders, the
insolvency receiver of the Pfandbrief Bank is entitled to demand transfer of any such assets to the
insolvency estate.
Subject to the consent of the BaFin, the Administrator may transfer to another Pfandbrief Bank all
or part of the cover assets and the liabilities arising from the Pfandbriefe issued against such
assets.
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