Security for capital and attractive interest rates: a new WohnbauAnleihe bond of Bank Austria Wohnbaubank

• “1.50%–3,50% Stufenzins-Wandelschuldverschreibung” (stepped-coupon convertible bond)
Bank Austria Wohnbaubank has launched a new WohnbauAnleihe bond for security-oriented investors:
The term of the new “1.50%–3,50% Stufenzins-Wandelschuldverschreibung 2014–2026/8” is 12 years. The interest rate is fixed for the entire term. Interest will be paid annually on a fixed date – for the first time in 2015. The average return over the entire term of the WohnbauAnleihe bond will be 2.15 per cent annually.
The new WohnbauAnleihe bond is denominated in units of EUR 100 with a minimum investment of EUR 1,000. Capital will be repaid at 100 per cent of the nominal value at the end of the term, provided that a bondholder has not converted the bonds held by him/her.

An investment in WohnbauAnleihe bonds offers tax benefits
For Austrian private investors, interest earned on WohnbauAnleihe bonds is not subject to Austrian capital yields tax (Kapitalertragsteuer – KESt) up to an amount of 4 per cent annually. These favourable conditions result in a higher net return compared with fully taxable bonds. For WohnbauAnleihe bonds purchased after 1 April 2012, capital gains on a sale are taxed at 25 per cent. In addition, WohnbauAnleihe bonds are covered by final taxation; in other words, interest income from them is not subject to income tax.
If investors require their money before maturity, the convertible bonds can be sold at the prevailing market price. However, it should be noted that the WohnbauAnleihe bonds are subject to price fluctuations during their term. If the investment is not held until the end of the term, the investor may recover less than the nominal value.

Eligible for use by entrepreneurs and independent professionals to benefit from the tax allowance for business profits
On the basis of the changes to the tax allowance for business profits adopted by the Austrian parliament on 24 February 2014 as part of the Austrian Tax Amendments Act 2014 (Abgabenänderungsgesetz 2014), Wohnbauanleihe bonds will be the only securities product qualifying for the investment-based tax allowance for business profits (for the first time in respect of financial years ending after 30 June 2014), in addition to tangible business assets. While business investors cannot take advantage of the capital yields tax benefit, the legal changes mean that additional funding will be available for housing construction.

Details of the bond issues:

“1.50%–3,50% Stufenzins-Wandelschuldverschreibung 2014-2026/8”
Issuer: Bank Austria Wohnbaubank AG
First value date: 20 November 2014, thereafter plus accrued interest.
ISIN: AT000B126016
Term: 12 years, 20 November 2014 – 19 November 2026
(based on the nominal value of 100%): If held to maturity, the average return on the bond will be
2.15% p.a.
1st to 6th years: 1.50% p.a.
7th and 8th year: 2.125% p.a.
9th and 10th year: 2.75% p.a.
11th and 12th year: 3.50% p.a.
Exempt from Austrian capital yields tax on presentation of a declaration of personal assets
Interest payments: Due and payable on 20 November of each year, for the first time on 20 November 2015.
Repayment/redemption: On 20 November 2026 at the nominal value, provided that the investor has not converted the bonds held by him/her.
Denomination: Nominal value of EUR 100 (minimum investment: EUR 1,000).
Issue price:

Your relationship manager will be able to provide you with information on the current issue price. The initial issue price has been set at 101.50%.

Conversion right: Convertible bonds with a nominal value of EUR 1,000 may be converted into 1 bearer participation certificate of the issuer. This corresponds to a nominal conversion ratio of 1 for 10.
Conversion dates: Annually on 1 January, for the first time on 1 January 2016.
Ordinary cancellation: Not possible.
Taxation: – Interest exempt from Austrian capital yields tax for Austrian private investors.
– Interest rates for business profits are taxed at 25% capital yields tax
– Capital gains on a sale are taxed at 25 per cent capital yields tax.
– WohnbauAnleihe bonds are qualified for the investment-based tax allowance for business profits
– For natural persons residing in a member state of the European Union other than Austria, all interest income from these securities is subject to the 35% EU withholding tax.
– With effect from 1 January 2015, natural persons from Non-EU-countries, who have limited tax liability in Austria, will be taxed with 25 per cent capital yields tax. Excluded are private investors.

Please note that the tax treatment depends on the investor’s personal circumstances, and that the tax advantages described may cease to apply in whole or in part as a result of future changes in the relevant laws.

This information regarding the above WohnbauAnleihe bond is intended solely for informational purposes and does not represent investment advice or an investment or product recommendation. Neither is it an offer or invitation to buy or sell the bond described herein, or a solicitation to make such an offer. It is intended solely as introductory information and is not a substitute for advice provided on the basis of the investor’s individual circumstances and knowledge. Every capital investment involves risks, and the value of the bond can fluctuate during its term. The WohnbauAnleihe bond will be redeemed at the nominal value on the redemption date according to the terms and conditions of the bond. The bond may be sold before maturity at the prevailing market price. The prevailing market price may be lower than the issue price, so it is possible that the investor may fail to recover the full invested amount.

This press release does not constitute a prospectus as defined by the Austrian Capital Market Act (Kapitalmarktgesetz – KMG). The prospectus from 12 September 2014 pursuant to Section 7 of the KMG was published on 16 September 2014 in accordance with Section 10 (3) of the KMG. The prospectus as well as the Final Terms are available free of charge at the registered office of Bank Austria Wohnbaubank AG, Lassallestrasse 1, A-1020 Vienna, and can also be obtained at any branch of UniCredit Bank Austria AG. An electronic version is available on the Internet at http://wohnbaubank.bankaustria.at.

Enquiries: Bank Austria Media Relations Austria
Matthias Raftl, tel. +43 (0)5 05 05 52809;
e-mail: matthias.raftl@unicreditgroup.at