UBI Banca Group

The new ratings assigned to the above securitisations did not compromise their eligibility for refinancing
operations with the European Central Bank. The only exception to this was the B@nca 24-7 consumer loan
securitisation, which remains ineligible because it has only one of the two ratings required by the ECB.
The downgrade of UBI Banca’s ratings by Fitch in 2012 made it necessary to take action again with further
restructuring of the three securitisations rated by Fitch (UBI Finance 2, UBI Finance 3 and UBI Lease
Finance 5). The following action was therefore taken:
• UBI Finance 2 Srl: the frequency of the coupon was changed from half yearly to quarterly and the
alignment of the swap hedges was modified as a consequence; the liquidity accounts of the special
purpose entity were moved from UBI Banca International Lux to another eligible counterparty (currently
Bank of New York Mellon); provision in the documentation of the payment of the “commingling”
guarantee 3 , as defined with Fitch; further changes to the definition of eligible investments so that the
special purpose entity may continue to invest in the Group’s commercial paper (ECP and French
certificates of deposit issued by UBI Banca International Lux);
• UBI Finance 3 Srl: the frequency of the coupon was changed from half yearly to quarterly and the
alignment of the swap hedges was modified as a consequence; the liquidity accounts of the special
purpose entity were moved from UBI Banca International Lux to another eligible counterparty (currently
Bank of New York Mellon); provision in the documentation of the payment of the “commingling”
guarantee, as defined with Fitch; further changes to the definition of eligible investments so that the
special purpose entity may continue to invest in the Group’s commercial paper (ECP and French
certificates of deposit issued by UBI Banca International Lux);
• UBI Lease Finance 5 Srl: creation of an extraordinary payment date (24 th February 2012) on which an
early extraordinary amortisation of the funds which had been formed until then on the accounts of the
special purpose entity was performed with a consequent decrease by approximately €900 million of the
senior tranche (nominal amount down from €3,440,500,000 to €2,539,986,695); the frequency of the
coupon was changed from half yearly to quarterly and the alignment of the swap hedges was modified
as a consequence; provision in the documentation of the payment of a “commingling” guarantee and the
actual payment of the sum with value date 24 th February 2012, as defined with Fitch; further changes
to the definition of eligible investments so that the special purpose entity may continue to invest in the
Group’s commercial paper (ECP and French certificates of deposit issued by UBI Banca International
Lux).
Finally, further action on swaps is still under study, designed mainly to reduce the margins paid.
The action described above, together with that taken in the fourth quarter of 2011, helped to reduce the
linkage between the securitisations in question with the Parent, UBI Banca, making them much less
vulnerable to possible further downgrades caused by changes in the Parent’s rating.
While the restructuring work was in progress in February 2012, Fitch confirmed its “A-“ rating for the three
securitisations in question, for UBI Finance 2 and UBI Finance 3 and for UBI Lease Finance 5 on completion
of that work. During that same period, however, Moody’s cut its rating on those same securitisations from
“Aa2” to “Aa3”.
The new ratings assigned to the above securitisations nevertheless remain compatible with the eligibility
requirement for refinancing operations with the European Central Bank.
3 Guarantee in cash to be paid into an account held in the name of the special purpose entity to be able to maintain management of the
collection accounts, which is to say the accounts into which the amounts are paid for the repayment of the loans transferred by the
originators.
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