COREALCREDIT BANK AG

Refinancing
The strict focus of COREALCREDIT's business model on tailoring financing propositions to the
needs of the capital markets allows the Bank to use a number of refinancing channels. Besides
traditional refinancing using borrower's note loans, unsecured debt securities and issuing
mortgage Pfandbriefe, the Bank's refinancing instruments also include securitisation and
syndication.
COREALCREDIT issues mortgage Pfandbriefe to refinance senior secured commercial property
loans. These are covered debt securities which are subject to the statutory requirements of the
German Pfandbrief Act (Pfandbriefgesetz, "PfandBG").
The public and mortgage Pfandbriefe in circulation must be covered by public sector loans or
senior secured mortgage loans with at least the same volumes and the same interest income at all
times (Section 4 PfandBG).
A trustee appointed by the Federal Financial Supervisory Authority ensures that the issuer meets
these requirements at all times (Section 8 PfandBG).
In the event of insolvency, Pfandbrief creditors are not involved in the bankruptcy proceedings;
interest and repayment claims will therefore continue to be serviced from the cover assets without
restriction (Sections 29 and 30 PfandBG).
Following the closure of the public financing business, COREALCREDIT no longer issues public
sector Pfandbriefe. However, the Bank will continue to manage the existing public sector
Pfandbriefe in circulation until expiry.
In the light of the continuing financial market crisis and the still constrained money market and
capital market, the Issuer submitted an application for a framework guarantee of bonds
(Schuldverschreibungen) to the German Financial Market Stabilisation Fund (Sonderfonds
Finanzmarktstabilisierung – SoFFin) in order to further strengthen its liquidity situation. This
framework guarantee has been granted in the amount of EUR 500 million, subject to particular
conditions to be met by the Issuer's sole shareholder. By the end of the first quarter 2011, all
SoFFin-guarateed bond issues have been redeemed prior to original maturity.
Principal Markets
COREALCREDIT is solely focussed on the German commercial real estate market.
Real estate investors from Germany are supported directly by the Bank's regional sales agencies
in Hamburg, Berlin, Düsseldorf, Frankfurt/Main, Stuttgart and Munich. Foreign investors in the
German real estate market are supported by COREALCREDIT's head office in Frankfurt/Main.
Rating
At the end of September 2011, following its annual review, the rating agency Fitch Ratings Ltd.
("Fitch") confirmed COREALCREDIT's "BBB-" rating. In addition, Fitch replaced the former
concept of individual ratings with viability ratings as the new standard in July 2011.
COREALCREDIT's viability rating was initially established at "bb"; the highest rating achievable
with a former individual rating of "D".
In December 2011, Fitch changed its subordinated debt rating methodology and placed the
subordinated loans of all banks, including COREALCREDIT, on "watch negative". The basis for the
subordinated debt rating was changed from the issuer default rating to the generally underlying
viability rating.
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