Current Report 

Drafted on:

21.03.2018

Current report No

10/2018

Abbreviated issuer’s name

mBank

Contents: 

The Management Board of mBank S.A. ("Bank") informs that on 21^st March 2018 the Bank early redeemed two series of perpetual subordinated bonds in the total amount of CHF 250 mn (PLN 905.125 mn according to average NBP fx rate of 21^st March 2018). The redemption of 25 (twenty five) bonds was made at their nominal value, that is CHF 10 mn (PLN 36.205 mn according to average NBP fx rate of 21^st March 2018) for each bond plus the amount of interest due on bonds accrued to the date of redemption in the total amount of CHF 1,167,447.51 (PLN 4,226,743.71 according to average NBP fx rate of 21^st March 2018). The average redemption price per bond amounted to CHF 10,046,697.90 (PLN 36,374,699.75 according to average NBP fx rate of 21^st March 2018). The bonds were purchased by Commerzbank AG with headquarters in Frankfurt am Main (“Commerzbank”). As of the repurchase date the bonds were redeemed.

The Bank has made the early redemption as the funds received via bonds were no longer included in Tier II capital, according to art. 490 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012.

Moreover, the Bank informs that on 21^st March 2018 it received subordinated loan in the amount of CHF 250 mn (PLN 905.125 mn according to average NBP fx rate of 21^st March 2018) based on the agreement signed with Commerzbank on 27^th November 2017 (“the Agreement”). According to terms of the Agreement, the disbursement of the loan as well as the repurchase of subordinated bonds occurred by way of netting of the related claims.

The repayment of the loan will occur 10 years after the drawdown date, with a possibility of a prepayment falling on the last day of each interest period but not earlier than 5 years after the drawdown date subject to the permission from the Polish Financial Supervision Authority (“PFSA”) – it refers to the case when the loan is, according to PFSA decision, included in the Bank's Tier II capital.

The loan shall be governed by German law however all the matters related to the Bank’s own funds, including classification of the loan as Tier II capital, shall be governed by Polish law (including European Union law as applicable in Poland).

Accrued interest will be paid in 3-month periods. Interest rate is based on the aggregate of the margin and 3-month CHF LIBOR rate.

The funds obtained from a subordinated loan are subject to the Bank's application for the approval of the PFSA for their inclusion in the Bank's Tier II capital.

Director of the Compliance Department

Agata Rowińska 21.03.2018