NEWS / Foreign Exchange

The Russian bear is getting stronger

The Russian bear is getting stronger

Agenda

• Presentation of the bond
• Presenting the Russian economy
• Macroeconomic situation
• Upswing firmly entrenched and the external balances are strong
• Monetary policy
• Exchange rate policy -managed float
• Inflation has come under control -at least for now
• Other factors
• Longer-term risks -a weakening of the external balances
• Why buy a rouble bond?
• Low risk with a decent coupon and possible currency upside

Danske Bank issues a rouble bond:

• Indicative terms and conditions :
• Issuer: Danske Bank A/S.
• Rating:Aa1 by Moody??™s / AA-by Standard & Poor??™s / AA-by Fitch.
• Currency: Russian Rouble (???RUB???).
• Nominal Amount: RUB 250,000,000.
• Issue & Re-offer Price:100.05 %.
• Coupon:5.50 % p.a.
• Announcement Date:24 April 2007.
• Settlement Date:14 May 2007.
• Maturity Date:14 November 2008.
• Denominations: RUB 50,000. Until the issue has been officially listed on the Copenhagen Stock Exchange (May 14), the bonds will only be sold to investors in allotments equal to or in excess of RUB 2,000,000, in order to comply with the European Prospective Directive.

Macroeconomic situation

• High growth in recent years
• Let??™s go shopping
• The labour market is getting tighter
• Exports -it??™s all about oil and gas
• Strong external balances

Monetary policy

• Is inflation trending downwards?
• Currency is pegged against a USD/EUR basket
• Rouble forecast

Other factors

• Risk factors
• Good reasons to buy a short rouble bond