FIRST SUPPLEMENT
(dated 24 July 2014)
to the
BASE PROSPECTUS
(dated 16 January 2014)
BANIF – BANCO INTERNACIONAL DO FUNCHAL, S.A.
(incorporated with limited liability in Portugal)
EUR 3,000,000,000
Covered Bonds Programme
This supplement dated 24 July 2014 (the “First Supplement”) to the Base Prospectus dated 16 January
2014 (the “Base Prospectus”), constitutes a supplement to the Base Prospectus, in the meaning of article
16 of Directive 2003/71/EC, as amended, prepared in connection with the Covered Bonds Programme
(the “Programme”) established by Banif – Banco Internacional do Funchal, S.A. (the “Issuer”, fully
identified in the Base Prospectus).
Terms defined in the Base Prospectus have the same meaning when used in this First Supplement.
Banif – Banco Internacional do Funchal, S.A., with head office at Rua de João Tavira, no. 30, 9004-509
Funchal, Portugal, the members of its Board of Directors, the members of its Audit Committee and its
Statutory Auditor have taken all reasonable care to ensure that the information contained in the Base
Prospectus, as supplemented by this First Supplement, is, to the best of their knowledge, in accordance
with the facts and contains no omission likely to affect its import.
This First Supplement is supplemental to, and should be read in conjunction with, the Base Prospectus.
To the extent that there is any inconsistency between any statement in this First Supplement and any
other statement in or incorporated by reference in the Base Prospectus, the statements in this First
Supplement will prevail.
1
Save as disclosed in this First Supplement, no other significant new factor, material mistake or
inaccuracy relating to information included in the Base Prospectus has arisen or been noted, as the case
may be, since the approval of the Base Prospectus.
This First Supplement and the Base Prospectus are available for viewing in the following websites:

Website of the issuer: www.banif.pt;

Website of the Comissão do Mercado de Valores Mobiliários: www.cmvm.pt
2
I.
GENERAL AMENDMENTS
1.
This First Supplement dated 24 July 2014 shall be referred to together with the Base Prospectus.
II.
RESPONSIBILITY STATEMENT
2.
The fourth paragraph under the Chapter “RESPONSIBILITY STATEMENT” shall be amended
and replaced by the following:
“Ernst & Young Audit & Associados – SROC, S.A. registered with the CMVM with number 9011,
with registered office at Av. da República, 90 – 6º - Lisbon, Portugal (the Statutory Auditor of the
Issuer), audited the consolidated financial statements of Banif as of and for the years ended 31
December 2011, 2012 and 2013 and performed a limited audit to the consolidated financial
statements of Banif for the 6 months ended 30 June 2013.”
III.
RISK FACTORS
3.
The following paragraphs under chapter “RISK FACTORS” shall be amended and replaced and
added as follows:
(i)
On page 7 of the Base Prospectus, under the sixteenth paragraph under the heading
“Portuguese Economy” shall be added the following:
“In May 2014, Portugal has exited its three-year-long international bailout program,
regaining control of its finances and it did not seek a credit line for any post-bailout
emergencies, but signalling that austerity measures aren't over.
The conservative government met for the occasion to develop a “medium-term strategy” on
continuing the reforms and encouraging economic growth.”
(ii)
On page 11 of the Base Prospectus, the first paragraph under the heading “Risk of a
Sovereign rating Downgrade” shall be amended and replaced by the following:
“The rating agencies Standard & Poor’s Credit Market Services Europe Limited (“S&P”),
Moody’s Investors Services Ltd. (“Moody’s”), Fitch Ratings Limited (“Fitch”) and DBRS,
Inc. (“DBRS”) have, on more than one occasion over the last years, downgraded the long
term rating of Portugal. Current ratings are as follows: S&P: BB as of 13 January 2012,
with outlook stable as of 9 May 2014; Moody’s: Ba2 (positive outlook) as of 9 May 2014;
Fitch: BB+ (positive outlook) as of 11 April 2014; DBRS: BBB (low) (outlook stable) as of
26 May 2014. Each of Moody’s, S&P and Fitch is established in the European Economic
Area (“EEA”) and registered under the CRA Regulation. DBRS is not established in the
European Union and has not applied for registration under the CRA Regulation. DBRS’
ratings have been endorsed by DBRS Ratings Limited in accordance with the CRA
3
Regulation. DBRS Ratings Limited is established in the European Union and registered
under the CRA Regulation.”
(iii)
On page 13 of the Base Prospectus, under the last point of the third paragraph under the
heading “Implications of the European Banks Recapitalization on Banif and on the
Portuguese Banking System” shall be inserted the following:
“• June/14:
€138,504,779.57
increase
of
share
capital
by
public
subscription
being the share capital of Banif increased to €1,720,700,000, represented by
115,640,000,000 shares without nominal value.
This capital increase operation was performed through public offering under
which
were
fully
subscribed
13,850,447,957
new
shares
at
a
price
Unit of € 0.01”
(iv)
On page 13 of the Base Prospectus, the fifth paragraph under the heading “Implications of
the European Banks Recapitalization on Banif and on the Portuguese Banking System”
shall be amended and replaced by the following:
“The reimbursements of the CoCos are expected to take place in three phases. After the
completion of the share capital increase operations on June, July, August and October,
2013, in the total amount of € 311.5 million, Banif performed on August 29, 2013 to the
reimbursement of the amount of €150,000,000 relative to the CoCos (such reimbursement
was scheduled to be made on June 30, 2013). On April 11, 2014 Banif repurchased 125
million of contingent convertible bonds (CoCo) and a third reimbursement of the remaining
€125,000,000 is expected to take place by December 2014.”
(v)
On page 14 of the Base Prospectus, the seventh paragraph under the heading “Implications
of the European Banks Recapitalization on Banif and on the Portuguese Banking
System” shall be amended and replaced by the following:
“The Portuguese State held, as of June 04, 2014, a 60.53 per cent. stake in Banif, which
corresponds to 49.37 per cent. of the voting rights. Furthermore, unless the Portuguese
State uses the mechanisms of divestment foreseen in Law 63-A/2008, 24 November, as
amended by Law 48/2013 16 July, or it occurs the entrance of new shareholders in the
Banif’s share capital, after the conclusion of the 2nd phase of the Recapitalisation Plan and
until the beginning of the public divestment process to be finalized by 2017, it is expected
that the Portuguese State will hold 60.53 per cent. of Banif’s share capital, which
corresponds to 49.37 per cent. of voting rights (following the € 450M share capital increase
subscribed by private investors).”
4
(vi)
On page 14 of the Base Prospectus, the first paragraph under the heading “Restructuring
Plan” shall be replaced the following:
“In conjunction with the Recapitalization Plan, Portugal committed to the EC to provide a
far-reaching Restructuring Plan for the Group until March 31, 2013. Such plan has been
subject to detailed and prolonged negotiations between the Ministry of Finance of Portugal
and the Directorate General for Competition, and is still subject to final approval by the
college of commissioners of the EC. On February 4, 2014, was submitted to the European
Commission a revised restructuring plan for Banif - Financial Group, containing the
proposed restructuring measures, including measures necessary to enable the repayment of
public investment in the form of CoCos in the process of recapitalization of the Bank and the
timetable for their implementation. The plan is still subject to discussion and approval by
the European Commission and is currently being updated incorporating the accounts of the
first quarter of 2014 for submission. Only after final approval of the restructuring measures
proposed by Portugal in the Restructuring Plan will it be possible to ensure the
compatibility of the capital injection received by the Group with EU state aid rules.
Consequently, the Restructuring Plan is not definitively closed yet, but it is already possible
to present a set of general guidelines already agreed, even though the final content may be
further adjusted. Due to the confidential nature of on-going negotiations between Portugal
and the Directorate General for Competition of the European Commission, the specific
terms of the Restructuring Plan cannot be disclosed by the Issuer.”
IV.
DOCUMENTS INCORPORATED BY REFERENCE
4.
On page 44 of the Base Prospectus, the first paragraph, lines (a) and (c), pertaining to the heading
“Documents Incorporated By Reference”, shall be amended and replaced by the following:
“(a) the audited consolidated financial statements of the Issuer in respect of the financial years
ended 31 December 2011 (in respect of the Issuer’s former designation as “Banif SGPS, S.A.”), 31
December 2012 and 31 December 2013, in each case together with the auditors’ reports prepared
in connection therewith (available at www.banif.pt and at www.cmvm.pt);
(b) (…);
(c) the unaudited consolidated financial statements of the Issuer for the period ended 31 March
2014.”
V.
DESCRIPTION OF THE ISSUER
5.
The below mentioned paragraphs under the chapter “DESCRIPTION OF THE ISSUER” shall be
amended and replaced and added by the following:
5
(i)
On page 112 of the Base Prospectus, the first paragraph under the heading “Incorporation
and Registered Office” shall be amended and replaced by the following:
“Banif - Banco Internacional do Funchal, S.A. (public limited company), which is currently
the parent company of the Banif Financial Group, was established on January 1988 in
Funchal, Madeira, Portugal. It is organised according to the laws of Portugal at the
Commercial Registry under no. 511 202 008. Its registered office is at Rua João Tavira, no.
30, 9004-509 Funchal, Portugal. Its telephone number is +351 291 207 700. Banif’s capital
is constituted by 45,640,000,000 ordinary and 70,000,000,000 special shares being the
ordinary shares traded on the Euronext Lisbon stock exchange. Banif’s share capital
amounts to €1.720.700.000,00, represented by 115,640,000,000 shares with no par value
(sem valor nominal)”.
(ii)
On page 116 of the Base Prospectus, under the last point of the first paragraph under the
heading “Recapitalisation Plan” shall be inserted the following:
“• June/14: €138,504,779.57 increase of share capital by public subscription
being the share capital of Banif increased to €1,720,700,000.00, represented by
115,640,000,000 shares without nominal value.
This capital increase operation was performed through public offering under
which
were
fully
subscribed
13,850,447,957
new
shares
at
a
price
Unit of € 0.01”
(iii)
On page 116 of the Base Prospectus, the second paragraph under the heading
“Recapitalisation Plan” shall be amended and replaced by the following:
“The CoCos are eligible for Core Tier I own funds and subject to an annual interest rate of
9.5 per cent., increased by 25 bps each year from 2013 to 2014 and 50 bps annually
thereafter. Reimbursements are expected to take place in three phases. After the completion
of the share capital increase operations on June, July, August and October 2013, in the total
amount of € 311.5 million, Banif performed on August 29, 2013 to the reimbursement of the
amount of € 150.000.000 relative to the CoCos. On April 11, 2014 Banif repurchased 125
million of contingent convertible bonds (CoCo) and a third reimbursement of the remaining
€125,000,000 is expected to take place by December 2014.”
(iv)
On page 116 of the Base Prospectus, the fourth paragraph under the heading
“Recapitalisation Plan” shall be amended and replaced by the following:
“The Portuguese State held, as of June 04, 2014, a 60.53 per cent. stake in Banif, which
corresponds to 49.37 per cent. of the voting rights. Furthermore, unless the Portuguese
6
State uses the mechanisms of divestment foreseen in Law 63-A/2008, 24 November, as
amended by Law 48/2013 16 July, or it occurs the entrance of new shareholders in the
Banif’s share capital, after the conclusion of the 2nd phase of the Recapitalisation Plan and
until the beginning of the public divestment process to be finalized by 2017, the Portuguese
State will hold 60.53 per cent. of Banif’s share capital, which corresponds to 49.37 per cent.
of voting rights (following the € 450M share capital increase subscribed by private
investors). According to Ministerial Order no. 1527-B/2013, the Government of Portugal, as
a holder of special shares, is entitled to receive a payment priority (preferred dividends)
corresponding to a percentage equal to its economic interest over 30 per cent. of
distributable profits of Banif the relevant financial year. Other than that, any distributable
profits which would otherwise be available to distribute as dividends to shareholders shall
be used to pay any priority dividend in respect to the special shares held by the Portuguese
State and/or to buyback any CoCos or Special Shares.”
(v)
On page 117 of the Base Prospectus, the first paragraph under the heading “Restructuring
Plan” shall be added the following:
“In conjunction with the Recapitalization Plan, Portugal committed to the EC to provide a
far-reaching Restructuring Plan for the Group. Such plan has already been submitted in
several versions, along with additional information, and has been subject to detailed and
prolonged negotiations between the Ministry of Finance of Portugal and the Directorate
General for Competition, and is still subject to final approval by the college of
commissioners of the EC. On February 4, 2014, was submitted to the European Commission
a revised restructuring plan for Banif - Financial Group, containing the proposed
restructuring measures, including measures necessary to enable the repayment of public
investment in the form of CoCos in the process of recapitalization of the Bank and the
timetable for their implementation. The plan is still subject to discussion and approval by
the European Commission and is currently being updated incorporating the accounts of the
first quarter of 2014 for submission. Only after final approval of the restructuring measures
proposed by Portugal in the Restructuring Plan will it be possible to ensure the
compatibility of the capital injection received by the Group with EU state aid rules.
Consequently, the Restructuring Plan is not definitively closed yet, but it is already possible
to present a set of general guidelines already agreed, even though the final content may be
further adjusted. Due to the confidential nature of on-going negotiations between Portugal
and the Directorate General for Competition of the European Commission, the specific
terms of the Restructuring Plan cannot be disclosed by the Issuer.”
7
(vi)
On page 119 of the Base Prospectus, after the text under the heading Terms of Commitment,
a new heading shall be added as follows:
“Reducing of operating costs – Employees and Agencies
Banif has been implementing, over the last two years, a process of profound transformation
for strengthening operational efficiency in a context of structural adjustment of the banking
sector and the significant changes of the regulatory and macro-prudential framework.
Towards enhancing the profitability of the Group, in particular by reducing operating costs,
the Banif Executive Committee decided to accelerate, until the end of 2014, the agencies
closing program that will cover 60 units. As of June 2014 were already closed 40 agencies.
The adjustment of the geographic presence of the Bank will imply the reduction of 300 jobs.
Banif created a program of voluntary and friendly terminations for employees. As of June
2014 the program was already accomplished, although it remains an ongoing broader
program to reduce staff.
With these measures, conditions are set to achieve strategic goals until 2017, in terms of
concentration, geographic focus and target business segments.”
(vii) On page 123 of the Base Prospectus, the paragraph under the heading “International Area”
shall be amended and replaced by the following:
“Banif should proceed with the progressive divestment of the banking units that lie outside
the sphere of action of the retail banking as well as all international units (excluding
representative offices and other forms of acting regarding emigration business) by the end
of 2017.
These divestments will take place during the implementation period of the Restructuring
Plan, occurring sparingly in order to maximize value for Banif - Financial Group. The
disposals may be made through public or private transactions, negotiated sales or a
combination of both.
Thus, under the Restructuring Plan, if approved, and in order to repay the state investment,
Banif may proceed to the divestment of all its international business units, including Brazil,
Malta, USA, Cape Verde, Bahamas, Banif Mais International and Banca Pueyo, until the
end of 2017 or sooner. The relatively advanced stage of negotiations with third parties,
leading to the completion of operations to achieve these divestments, justified the
classification of the Bank Banif Brasil, Banco Caboverdiano de Negócios and Banif Bank
(Malta) as discontinued operations from December 2013.”
8
(viii) On page 124 of the Base Prospectus, after the last paragraph under the heading “Main
Financial Indicators of Banif Financial Group as of September 2013”, shall be added the
new heading “Main Financial Indicators of Banif Financial Group as of March 2014”
with the following table and text:
“The net interest income rose 59 per cent. year on year, to 33.3 million euros, reflecting the
effects of the current process of business model adjustment, which consists in a strategy of
repositioning Banif commercially, offering higher value products to the corporate segment
and cutting funding costs through greater selectivity in the capture of customer resources.
Excluding the effect of costs related with the voluntary redundancy program (5.1 million
euros in the first quarter of 2014, compared with 0.2 million euros in the first quarter of
2013), structure costs fell by 4.9 per cent. versus the first quarter of 2013 (-6.9 per cent.
excluding non-recurrent recapitalization-related costs). It is worth recalling that already in
2013 the Bank recorded a 12.8 per cent. reduction in operating costs, including a set of nonrecurrent recapitalization-related costs that reached 13.2 million euros.
Net provisions and impairments in the first quarter of 2014 stood at 48.1 million euros. The
coverage ratio of overdue credit (>90 days) by impairments stood at 96.5 per cent. at the
end of March 2014, not including collateral guarantees, taking into account the effect of
discontinued operations.
9
As at 31 March 2014 the Common Equity Tier 1 ratio, calculated in accordance with the
CRD IV/CRR rules applicable in 2014 ( phasing in), and “fully implemented” stood at 10.2
per cent. and 8.0 per cent., respectively, above the minimum levels required by the
regulatory authorities.”
(ix)
On page 135 of the Base Prospectus, the last two paragraphs under the heading
“Shareholder structure of Banif” shall be amended and replaced by the following:
“At the date of this Prospectus, the shares held by the Portuguese State stood at 60.533 per
cent. of the share capital, corresponding to 49.374 per cent. of the voting rights. With regard
to other holdings, the Undivided Inheritance of Horácio da Silva Roque held a qualified
holding in Banif, indirectly owned, representing 7,298,748,811 ordinary shares,
representing 6.312 per cent. of the share capital and 8.096 per cent. of the voting rights
(which includes participation under Article 20 of the Portuguese Securities Code, the
6,953,088,628 ordinary shares, representing 6.013 per cent. of the share capital and 7.713
per cent. of the voting rights held by Açoreana Seguros). Following negotiations with
Equatorial Guinea’s authorities, a non-binding memorandum of understanding (MoU) was
signed on 27 January 2014, aiming at (i) promote the cooperation between the Equatorial
Guinea’s authorities and Banif in relation to the guinea’s banking sector and, (ii) express
the intention of a Guinean public company or fund acquire a qualified shareholding in the
capital of Banif, in an amount of 133.5 million euros.”
(x)
On page 135 of the Base Prospectus, the text and table under the heading “Members of the
Board”, shall be amended and replaced by the following:
“Following the amendments to the Articles of Association approved at a meeting of the
General Assembly of May 30, 2014, which substantiate the abandonment of the classic
model of governance and the adoption of the Anglo-Saxon model, the existing Audit
Committee became extinct on this date, with the termination of service of its members, and
was created a new Audit Committee of the Board of Directors, which will be entrusted with
supervision, in accordance with legal and statutory terms for that body.
Following the resolutions adopted at this General Assembly and the cessation of
functions of the former Audit Committee members, including the member appointed by the
Portuguese Government, those members are now being integrated into the Board of
Directors, for the exercise of functions in its new Audit Committee.
In this context, the above mentioned decision shall produce effects after the Bank of
Portugal approval of the statutory change and completion of the registration procedures
10
with the Bank of Portugal which is expected to occur in the near future. Therefore, after the
verification of such condition and due to the changes mentioned above, the Board of
Directors of Banif, on the three year period 2012-2014, shall be composed of the members
listed below:
(i)
Luís Filipe Marques Amado (Chairman of the Board) - Independent
(ii)
Jorge Humberto Correia Tomé (Vice-Chairman of the Board and Chairman of the
Executive Comittee) – Not Independent
(iii)
Maria Teresa Henriques da Silva Moura Roque (Vice-Chairman of the Board) – Not
Independent
(iv)
Vitor Manuel Farinha Nunes (Member of the Board) – Not Independent
(v)
Nuno José Roquette Teixeira (Member of the Board) – Not Independent
(vi)
João Paulo Pereira Marques de Almeida (Member of the Board) – Not Independent
(vii) João José Gonçalves de Sousa (Member of the Board) – Not Independent
(viii) António Carlos Custódio de Morais Varela (Member of the Board)– Not Independent
(ix)
Fernando Mário Teixeira de Almeida (Member of the Board and Chairman of the
Audit Committee) – Not Independent
(x)
António Ernesto Neto da Silva (Member of the Board and the Audit Committee) –
Independent
(xi)
Thomaz de Mello Paes de Vasconcellos (Member of the Board and the Audit
Committee) –Independent
(xii) Issuf Ahmad (Member of the Board and the Audit Committee) – Not Independent
The corporate address of the Directors is: Rua de João Tavira, 30, 9004-509 Funchal,
Portugal.
It is set out, on the following table, the name of all the companies that the members of the
Board of Directors have already been members of corporate bodies, on the five previous
years to the date of the Prospectus, including positions in consolidated direct subsidiaries
and holdings, as well as positions in other companies not belonging to Banif Financial
Group.
11
Board of Directors
Chairman: LUIS FILIPE MARQUES AMADO
Corporate positions in other companies:
a) Banif Group
Chairman of the General Meeting and Chairman of the Compensation Committee

Banco Caboverdiano de Negócios, SA
Chairman of the Supervisory Board

Banif Plus Bank ZRT
b) Other positions
International Consultant
Visiting Professor

Instituto Superior de Ciências Sociais e Políticas

Business School da Universidade Nova de Lisboa
Curator

Fundação Oriente
Member of the Superior Board

D. Dinis, Business School
Member of the Board of Directors

Fundação Francisco Manuel dos Santos
Member of the Council of Patrons

Fundação Arpad Szenes – Vieira da Silva
Member

European Council on Foreign Relations
Correspondent Academic

Academia Internacional de Cultura Portuguesa
12
Vice-Chairman: JORGE HUMBERTO CORREIA TOMÉ
Corporate positions in other companies:
a) Grupo Banif
Chairman of the Board

Banif - Banco de Investimento (Brasil), SA

Banif Imobiliária, SA

Banif - Banco Internacional do Funchal (Brasil), SA

Banif - Banco de Investimento, SA

Banif Finance, Ltd

Banif International Bank, Ltd

Banif Capital – Sociedade de Capital de Risco, SA
Chairman of the Executive Committee

Banif Finance, Ltd

Banco Banif Mais, SA
Member of the Board of Directors

Banif Bank (Malta), PLC

Banif International Bank, Ltd.

Banco Banif Mais, SA

Banif Mais, SGPS, SA

Banif Finance, Ltd

Banif Capital – Sociedade de Capital de Risco, SA
b) Other positions
Member of the Board of Directors

Associação Portuguesa de Bancos (in behalf of Banif - Banco Internacional do
Funchal, SA)
13
Vice-Chairman: MARIA TERESA HENRIQUES DA SILVA MOURA ROQUE
Corporate positions in other companies:
a)Banif Group
Member of the Board of Directors

Banco Banif Mais, SA

Banif Mais SGPS SA

Banif Bank (Malta) p.l.c.
Chairman of the General Meeting

Banif Gestão de Activos – Sociedade Gestora de Fundos de Investimento
Mobiliário, SA, em representação da Rentipar Financeira – SGPS, SA

Banif Capital - Sociedade de Capital de Risco, SA, em representação da Rentipar
Financeira – SGPS, SA
b) Other positions
Chairman of the Board

Sociedade Imobiliária de Empreendimentos Turísticos – Siet Savoi, SA

Soil – SGPS, SA

Rentipar Seguros, SGPS, SA

Rentipar Financeira, SGPS, SA
Vice-Chairman of the Board

Fundação Horácio Roque – Instituição Particular de Solidariedade Social, SA

Empresa Madeirense de Tabacos, SA

Rama-Rações para Animais, SA

Aviatlântico – Avicultura, SA

Açoreana Seguros, SA
Member of the Board of Directors

Rentipar Investimentos, SGPS, SA

Câmara de Comércio Luso-Britânica
14

MS Mundi – Serviços Técnicos de Gestão e Consultoria, SA
Manager

Ronardo – Gestão de Empresas, Lda
Chairman of the General Meeting

Rentimédis - Mediação Seguros, SA

Génius - Mediação Seguros SA

Mundiglobo - Habitação e Investimentos, SA

Empresa Madeirense de Tabacos, SA

Rama-Rações para Animais, SA

Aviatlântico – Avicultura, SA

Habiprede - Sociedade de Construções, SA
Vice – Chairman of the General Meeting

Sociedade Imobiliária de Empreendimentos Turísticos – Siet Savoi, SA
Member of the Board of Directors

St. Julian’s School – Carcavelos
Member of the Consultative Council

Câmara de Comércio e Indústria Luso-Espanhola

Nova School of Business and Economics
Member of the Board: ANTÓNIO CARLOS CUSTÓDIO DE MORAIS VARELA1
a) Other positions:

Member of the Compensation Committee from Banif – Banco internacional do
Funchal SA and member of the Advisory Board (CFO Forum of ISCTE- IUL).
1
Member of the Board of Directors appointed by Order No. 3454-A/2013, 1 March, the Ministry of Finance, on
behalf of the Portuguese State.
15
Member of the Board: JOÃO JOSÉ GONÇALVES DE SOUSA
No other positions in other companies
Member of the Board: JOÃO PAULO PEREIRA MARQUES DE ALMEIDA
Corporate positions in other companies:
a)Banif Group
Member of the Board of Directors

Banif – Banco Internacional do Funchal (Brasil), SA

Banif – Banco de Investimento (Brasil), SA

Banif Finance, Ltd
Member of the Board: NUNO JOSÉ ROQUETTE TEIXEIRA
Corporate positions in other companies:
a)Banif Group
Chairman of the Board

Gamma – Sociedade de Titularização de Créditos, SA

Banif Gestão de Activos (Brasil), SA
Vice-Chairman of the Board

Banif – Banco de Investimento (Brasil), SA
Member of the Board of Directors

Banif - Banco Internacional do Funchal (Brasil), SA

Banif - Banco Internacional do Funchal (Cayman), Ltd

Banif International Bank, Ltd

Banif Finance, Ltd

Banif Securities, Inc
Chairman of the General Meeting

Beta Securitizadora, SA
16
Member of the Compensation Committee

Banif Imobiliária, SA
b) other entities
Member of the Board of Directors

Açoreana Seguros, SA
Member of the Board: VITOR MANUEL FARINHA NUNES
Corporate positions in other companies:
a) Banif Group
Chairman of the Board

Banif Rent – Aluguer Gestão e Comércio de Veículos Automóveis, S.A
Vice-Chairman of the Board

Banif – Banco de Investimento, S.A.
Member of the Board of Directors

Banif Mais SGPS, S.A.

Banco Banif Mais, S.A.

Banif Plus Bank Zrt.

TCC Investments Luxembourg, S.à.r.l.

Banif Imobiliária, SA

Banif Capital – Sociedade de Capital de Risco, SA

Gamma – Sociedade de Titularização de Créditos, SA
Manager

Margem - Mediação de Seguros, Lda.
Member of the Consultative Council

ECS – Sociedade de Capital Risco, SA (in behalf of Banif – Banco Internacional do
Funchal, SA)
Member of the Steering Committee of the Consolidation Fund of the Construction Sector
17

Vallis Construction Sector Consolidation Fund, G.P. S.à.r.l., SICAV-SIF, (in behalf
of Banif - Banco Internacional do Funchal, SA).
Member of the Monitoring Commission of Banif Pension Funds Pension Plans, in behalf
of the Banif – Banco Internacional do Funchal, SA associate
b) other positions
Sole Administrator

FN Participações, SGPS, SA
Audit Committee
Chairman: FERNANDO MÁRIO TEIXEIRA DE ALMEIDA
Corporate positions in other companies:
a) Banif Group:
Chairman of the Audit Committee

Banif - Banco de Investimento, SA
b) Other positions
Chairman of the Audit Committee

Açoreana Seguros, SA
Member of the Board: ANTÓNIO ERNESTO NETO DA SILVA
Corporate positions in other companies:
a) Other positions
Chairman of the Board

Deimos Engenharia, SA

Financetar- Sociedade de Serviços Financeiros, Empresariais e Imobiliários, SA
Vice-Chairman of the General Meeting

CIP – Confederação Empresarial de Portugal, SA
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Member of the Board: THOMAZ DE MELLO PAES DE VASCONCELLOS
Corporate positions in other companies
a) Other positions
Member of the Audit Committee

Açoreana Seguros, SA
Member of the Board and Chairman of the Audit Committee and Compensation
Committee

TimeW SGPS
Member of the Board: Dr. ISSUF AHMAD
No other positions in other companies
The following table shows the number of shares held directly by members of the Board of
Directors and Audit Committee of Banif at June 04, 2014:
Member of the Board / Audit
Committee
Jorge Humberto Correia Tomé
Maria Teresa Henriques da Silva Moura
Roque
Number of shares held as of 04/06/2014
15.995.780
9.894.751
João José Gonçalves de Sousa
1.236.090
João Paulo Pereira Marques de Almeida
1.378.419
Nuno José Roquette Teixeira
1.545.114
Vitor Manuel Farinha Nunes
14.675.277
Fernando Mário Teixeira de Almeida
Total
743.107
45.468.538
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No share allocation plans or stock option plans or plans based on variation of stock prices
are currently in operation, nor are there plans for any such plans of options. The
compensation of Banif Management and Supervisory Bodies was € 2.900 thousands in
2012.”
The remunerations, in 2013, of the members of the Board of Directors (including the
members of the Executive Committee) and the former Audit Committee were:
Remuneration (including
Name
attendance fees)
– Luís Filipe Marques Amado
150.611
– Jorge Humberto Correia Tomé
194.415
– Maria Teresa H. M. Roque
17.999
– Vitor Manuel Farinha Nunes
158.101
– Nuno José Roquette Teixeira
158.105
– Diogo António Rodrigues da Silveira
13.500
– João Paulo Pereira Marques de
Almeida
– João José Gonçalves de Sousa
– António Carlos Custódio Morais
Varela (*)
139.577
132.858
120.204
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– Carlos Eduardo Pais e Jorge (**)
– José António Vinhas Mouquinho
(**)
– Gonçalo V. G. da Câmara de M.
Botelho (**)
87.189
80.394
90.126
(*) Appointed during March 2013
(**) Termination of functions at August 23, 2013”
(xi)
On page 136 of the Base Prospectus, the text and table under the heading “Audit
Commitee”, shall be considered erased.
VI.
PORTUGUESE BANKING SUPERVISION AND REGULATION
6.
On pages 149 and 150 of the Base Prospectus, under the chapter “PORTUGUESE BANKING
SUPERVISION AND REGULATION”, the following paragraph shall be added after the last
paragraph of the heading “Capital Adequacy and Solvency Ratios”:
“Banif’s activity is highly exposed to changes in the Legal and Regulatory framework of the
banking activity, namely requirements to be able to provide certain services and capital and
liquidity requirements. Significant changes have occurred and are foreseen to occur in Banif’s
legal and regulatory framework, as result of the European Union reforms implemented on the
financial sector, being expected that Banif will face increased regulation with an adverse and
significant impact on its activity. Specifically, Banif is subject to additional requirements with
regards to capital ratios, leverage, liquidity and mandatory information, which will have
increased compliance costs.
The implementation of Basel III in the European Union has led to the approval of the package
comprised by the Capital Requirements Directive 2013/36/EU and the Prudential Requirements
Regulation n. 575/2013 (CRD IV/CRR), in place since 1 January 2014 and will imply a
reinforcement of the capital requirements of the banks and changes to the definition of regulatory
capital. These measures may have a significant impact in Banif’s capital and in its assets and
liabilities management.
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The Notice no. 6/2013 from Bank of Portugal, regulates the transition provided in Regulation
(EU) n. º 575/2013 regarding capital requirements and establish measures for the preservation of
those funds.
Between January 1, 2014 and December 31, 2014, on a temporary basis pursuant the Rule
465 °/1 of the mentioned Regulation, the following minimum capital ratios shall apply: Common
Equity Tier 1 ratio - 4.5 per cent. and Tier 1 capital – 6 per cent. Nevertheless, the Bank of
Portugal requires entities to ensure the maintenance, at all times, of a ratio of Common Equity
Tier 1 ratio not less than 7 per cent., being able to impose measures when this does not occur.
As of 31 March 2014 the Common Equity Tier 1 ratio, calculated in accordance with the CRD
IV/CRR rules applicable in 2014 (phasing in), and “fully implemented” stood at 10.2 per cent.
and 8.0 per cent., respectively, above the minimum levels required by the regulatory authorities.”
VII. TAXATION
7.
On page 170 and following of the Base Prospectus, the following paragraphs under the chapter
“TAXATION”, shall be amended and replaced and added as follows:
(i)
On page 170 of the Base Prospectus, the footnote no. 3 under the heading “Special debt
securities tax regime” shall be considered erased.
(ii)
On page 172 of the Base Prospectus, the third paragraph under the heading “(a) Domestic
Clearing Covered Bonds” shall be amended and replaced by the following:
“If the conditions for the exemption to apply are met, but, due to inaccurate or insufficient
information, tax was withheld, a special refund procedure is available under the special
regime approved by Decree-Law 193/2005. The refund claim is to be submitted to the direct
registration entity of the Covered Bonds within 6 months from the date the withholding took
place. A special tax form for these purposes was approved by Order (“Despacho”) no.
2937/2014, published in the Portuguese official gazette, second series, n. 37, of 21
February 2014 issued by the Portuguese Secretary of Tax Affairs Office (integrated in the
“Ministério das Finanças”) and may be available at www.portaldasfinancas.gov.pt.”
(iii)
On page 172 of the Base Prospectus, the “CERTIFICATE FOR EXEMPTION FROM
PORTUGUESE WITHOLDING TAX ON INCOME ARISING FROM DEBT
SECURITIES” shall be considered erased.
(iv)
On page 176 of the Base Prospectus, the “APPENDIX STATEMENT OF BENEFICIAL
OWNERSHIP” shall be considered erased.
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(v)
On page 178 of the Base Prospectus, the “STATEMENT FOR EXEMPTION FROM
PORTUGUESE WITHOLDING TAX ON INCOME ARISING FROM DEBT
SECURITIES” shall be considered erased.
(vi)
On the page 180 of the Base Prospectus, the “APPENDIX LIST OF BENEFICIAL
OWNERS” shall be considered erased.
(vii)
On page 181 of the Base Prospectus, the second paragraph before the heading “EU Savings
Directive” shall be amended and replaced by the following:
“If the conditions for the exemption to apply are met, but, due to inaccurate or insufficient
information, tax was withheld, a special refund procedure is available under the special
regime approved by Decree-law 193/2005. The refund claim is to be submitted to the direct
or indirect registration entity of the Covered Bonds within 6 months from the date the
withholding took place. A special tax form for these purposes was approved by Order
(“Despacho”) no. 2937/2014 (2nd series), published in the Portuguese official gazette,
second series, n. 37, of 21 February 2014 issued by the Portuguese Secretary of Tax Affairs
Office (integrated in the Ministério das Finanças") and may be available at
www.portaldasfinancas.gov.pt.”
VIII. GENERAL INFORMATION
8.
On page 189, the following paragraphs under the chapter “GENERAL INFORMATION” shall be
amended as follows:
(i)
On page 189 of the Base Prospectus, the paragraph under the heading “Significant or
material change” shall be amended and replaced by the following:
“Save as disclosed in the section of this base prospectus with the heading “Description of
the Issuer”, there has been no significant change in the financial or trading position of the
Issuer since 31 December 2013 and there has been no material adverse change in the
financial position or prospects of the Issuer since 31 December 2013.”
(ii)
On page 189 of the Base Prospectus, the paragraphs under the heading “Accounts” shall be
amended and replaced by the following:
“The auditors of the Issuer are PricewaterhouseCoopers & Associados – Sociedade de
Revisores Oficiais de Contas, Lda. (“Auditor”), which is a member of the Portuguese
Institute of Statutory Auditors (Ordem dos Revisores Oficiais de Contas), with registered
23
office at Palácio Sottomayor, Rua Sousa Martins, 1-2º Lisbon, represented by José Manuel
Henriques Bernardo.
The financial statements of the Issuer in respect of the financial years ended 31 December
2011 (in respect of the Issuer’s former designation as “Banif SGPS, S.A.”), 31 December
2012 and 31 December 2013, and the unaudited consolidated financial statements of the
Issuer for the period ended 31March 2014 (available at the following websites www.banif.pt
and www.cmvm.pt).
The financial statements of the Issuer in respect of the financial years ended 31 December
2011, 31 December 2012 and 31 December 2013 were prepared in accordance with
IAS/IFRS and were audited in accordance with the auditing standards (“Normas Técnicas e
Directrizes de Revisão/Auditoria”) issued by the Portuguese Institute of Statutory Auditors
(“Ordem dos Revisores Oficiais de Contas”), which require the examination to be planned
and performed with the objective of obtaining reasonable assurance about whether the
consolidated financial statements are free of material misstatement. The financial
statements of the Issuer in respect of the financial years ended 31 December 2011, 31
December 2012 and 31 December 2013, which are incorporated by reference in this Base
Prospectus, were audited by Ernst & Young Audit & Associados – SROC, S.A.”
(iii)
On page 190 of the Base Prospectus, the first paragraph, line (b) under the heading
“Documents Available” shall be amended and replaced by the following:
“the audited consolidated financial statements of the Issuer and the auditor’s report
contained in the Issuer’s Annual Report in respect of the financial years ended 31 December
2011 (in respect of the Issuer’s former designation as “Banif SGPS, S.A.”), 31 December
2012 and 31 December 2013, and the unaudited consolidated financial statements of the
Issuer for the period ended 31 March 2014;”.
24