INFORMATION MEMORANDUM

African Development Bank
Global Debt Issuance Facility
For issues of Notes with maturities of one day or longer
This Information Memorandum comprises neither a base prospectus for the purposes of Article 5.4
of Directive 2003/71/EC (the ‘‘Prospectus Directive’’) nor a document for listing purposes under the EuroMTF market of the Luxembourg Stock Exchange but does comprise a base prospectus solely for the
purposes of the Luxembourg Law on prospectuses for securities insofar as it applies to exempt issuers
under Article 1(2)(b) of the Prospectus Directive. Application has been made to the Luxembourg Stock
Exchange for notes (the ‘‘Notes’’) issued under the global debt issuance facility (the ‘‘Facility’’) describedin this Information Memorandum to be admitted to the official list of the Luxembourg Stock Exchange(the ‘‘Official List’’) and to trading on the regulated market of the Luxembourg Stock Exchange. The
regulated market of the Luxembourg Stock Exchange is the regulated market for the purposes of
Directive 2004/39/EC on Markets in Financial Instruments. References in this Information Memorandum
to Notes being ‘‘listed’’ (and all related references) shall mean that such Notes have been admitted to the
Official List and admitted to trading on the Luxembourg Stock Exchange’s regulated market. The Facility
provides that Notes may be listed on such other or further stock exchange(s) as may be agreed between
the Bank and the relevant Dealer(s) in relation to each issue. Unlisted Notes may also be issued pursuant
to the Facility. The applicable Pricing Supplement in respect of the issue of any Notes will specify
whether and on which exchange such Notes will be listed or whether such Notes will be unlisted. This
Information Memorandum supersedes and replaces the Information Memorandum dated 8 July 2008.

Arranger

Citi
Dealers
Australia and New Zealand Banking Group Limited
Barclays Capital
Citi
Credit Suisse
Goldman Sachs International
J.P. Morgan
Mizuho International plc
Nomura International
Société Générale Corporate & Investment Banking
Standard Chartered Bank

BofA Merrill Lynch
BNP PARIBAS
Commerzbank
Daiwa Securities SMBC Europe
HSBC
Mitsubishi UFJ Securities International plc
Morgan Stanley
Shinkin International
Standard Bank
TD Securities

Information Memorandum dated 8 September 2009

The African Development Bank (referred to herein as the ‘‘Bank’’) represents that it has taken all
reasonable care to ensure that the information concerning the Bank contained in this Information
Memorandum is true and accurate in all material respects on the date of this Information Memorandum
and that as of the date hereof there are no other material facts in relation to the Bank the omission of which
would make misleading any statement herein, whether of fact or of opinion.
The Dealers have not independently verified the information contained herein. Accordingly, norepresentation, warranty or undertaking, express or implied, is made and no responsibility or liability is
accepted by the Dealers as to the accuracy or completeness of the information contained or incorporated inthis Information Memorandum or any other information provided by the Bank in connection with theProgramme.
No person is authorised to give any information or to make any representation not contained in the
Information Memorandum or any pricing supplement (each a ‘‘Pricing Supplement’’, referred to on page 8
hereof and comprising final terms solely for the purposes of the Luxembourg Law on prospectuses forsecurities insofar as it applies to exempt issuers under Article 1(2)(b) of the Prospectus Directive) inconnection with the offering of the Notes. If any such information or representation is nevertheless given or
made by any dealer, broker, seller or other person, it must not be relied upon as having been authorised by
the Bank or by any of the Dealers (as defined in ‘‘Subscription and Sale’’ below).
The issue of this Information Memorandum or any Pricing Supplement and the issue, subscription,offering and sale of the Notes are not a waiver by the Bank or by any of its members, Governors, Directors,
Alternates, officers or employees of any of the rights, immunities, privileges or exemptions conferred upon
any of them by the Agreement Establishing the African Development Bank (as amended) (the‘‘Agreement’’), or by any statute, law or regulation of any member of the Bank or any politicalsubdivision of any member, all of which are hereby expressly reserved. The Bank is, however, amenable tosuit in respect of its obligations under the Notes in accordance with the terms and conditions of the Notes.
THE NOTES ARE NOT AN OBLIGATION OF ANY GOVERNMENT.
The Notes may not be offered, sold or delivered, nor may this Information Memorandum, any Pricing
Supplement or any other offering material be distributed, in any country or jurisdiction except incircumstances that will result in compliance with all applicable laws and regulations. No action has been or
will be taken by the Bank or the Dealers that would permit a public offering of the Notes or the circulation
or distribution of this Information Memorandum, in proof or final form, any Pricing Supplement, or any
offering material in relation to the Bank or the Notes in any country or jurisdiction where action for that
purpose is required.
The Notes are not required to be registered under the United States Securities Act of 1933, as amended(the ‘‘Securities Act’’). Accordingly, no registration statement has been filed with the US Securities andExchange Commission (the ‘‘Commission’’). THE NOTES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS INFORMATION MEMORANDUM. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITEDSTATES.
Notes in bearer form (‘‘Bearer Notes’’) are subject to US tax law requirements. Subject to certain
exceptions, Bearer Notes may not be offered, sold or delivered within the United States or to, or for theaccount or benefit of, United States persons.
Notes denominated in Australian dollars and issued in Australia (‘‘Australian Domestic Notes’’) will
be offered only in the wholesale capital markets and on the basis that no disclosure to investors is required
under Part 6D.2 of the Corporations Act 2001 of the Commonwealth of Australia. The Bank is not
authorised under the Banking Act 1959 of the Commonwealth of Australia to carry on banking businessnor is the Bank subject to prudential supervision by the Australian Prudential Regulation Authority. The
obligations of the Bank are not guaranteed by the Commonwealth of Australia. Amendments to the Terms
and Conditions set out herein which are applicable to Australian Domestic Notes will be set out in therelevant Pricing Supplement.
This Information Memorandum (or any Pricing Supplement issued in connection with it) does notconstitute an offer of, or an invitation by or on behalf of the Bank or any of the Dealers to subscribe for orpurchase, any of the Notes.

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In this Information Memorandum, unless otherwise specified, references to ‘‘EUR’’, ‘‘euro’’ and ‘‘B’’
are to the lawful currency of the Member States of the European Union that have adopted the single
currency introduced at the start of the third stage of the European Economic and Monetary Union pursuant
to the Treaty establishing the European Community, as amended, references to ‘‘U.S.$ and ‘‘U.S. dollars’’or ‘‘dollars’’ are to United States dollars and references to ‘‘A$’’ and ‘‘Australian dollars’’ are to the lawful
currency of the Commonwealth of Australia.
In connection with the issue of any Tranche of Notes under the Facility, the Dealer or Dealers (if any)
named as the Stabilising Manager(s) in the applicable Pricing Supplement (or any person(s) acting on
behalf of any Stabilising Manager(s)) may over-allot Notes or effect transactions with a view to supporting
the price of the Notes at a level higher than that which might otherwise prevail. However, there is no
assurance that the Stabilising Manager(s) (or any agent of the Stabilising Manager(s)) will undertake
stabilisation action. Any stabilisation action may begin at any time after the adequate public disclosure of
the Pricing Supplement for the offer of the relevant Tranche of Notes and, if begun, may be ended at any
time, but it must end no later than the earlier of 30 days after the issue date of the relevant Tranche of Notes
and 60 days after the date of the allotment of the relevant Tranche of Notes. Any stabilisation action or
over-allotment must be conducted by the relevant Stabilising Manager(s) (or any agent of such Stabilising
Manager(s)) in accordance with all applicable laws and rules.

DOCUMENTS INCORPORATED BY REFERENCE
The following documents shall be deemed to be incorporated by reference in, and to form part of,this Information Memorandum:(i)the most recent publicly available information statement (the ‘‘Information Statement’’) of
the Bank, beginning with the Information Statement dated 10 August 2009;(ii)

the most recently published financial statements and reports of the independent auditors of
the Bank contained in the annual reports of the Bank;(iii) any amendment or supplement to the Information Statement or to this Information
Memorandum; and(iv) with respect to any Notes issued by the Bank, the relevant Pricing Supplement,
except that any statement contained in this Information Memorandum and any of the documents
incorporated by reference in, and forming part of, this Information Memorandum shall be deemed to bemodified or superseded for the purpose of this Information Memorandum to the extent that a statement
contained in a document subsequently incorporated by reference in this Information Memorandum
modifies or supersedes that statement.

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The Bank will, at the specified offices of the Paying Agents, provide, free of charge, upon the oral or
written request therefor, a copy of this Information Memorandum (or any document incorporated byreference in this Information Memorandum). Written or oral requests for such documents should bedirected to the specified office of any Paying Agent or the specified office of the Listing Agent in
Luxembourg.
In addition, the Bank is subject to certain informational requirements of Regulation AFDB
promulgated by the Securities and Exchange Commission under Section 9(A) of the African
Development Bank Act of the United States, and in accordance therewith files its annual report,
regular quarterly financial statements and other information with the Commission. Such reports, financial
statements and other information can be inspected at the public reference room of the Commission at
100 F Street, N.E., Room 1580, Washington, D.C. 20549, and copies of such material can be obtained
from the Public Reference Section of the Commission at the above address at prescribed rates.

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TABLE OF CONTENTS
Summary of the Facility..........................................................................................................................

6

Terms and Conditions of the Notes ......................................................................................................

10

Summary of Provisions relating to the Notes while in Global Form ..............................................

25

Use of Proceeds........................................................................................................................................

27

Risk Factors ..............................................................................................................................................

28

Taxation .....................................................................................................................................................

31

Related Derivatives Transactions ..........................................................................................................

42

Subscription and Sale ..............................................................................................................................

43

Form of Pricing Supplement ..................................................................................................................

46

General Information ................................................................................................................................

53

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SUMMARY OF THE FACILITY
The following is a brief summary only and should be read, in relation to any series of Notes, inconjunction with the relevant Pricing Supplement and, to the extent applicable, the Terms andConditions of the Notes set out on pages 10 to 24 hereof.
IssuerAfrican Development Bank.

Arranger

Citigroup Global Markets Limited.

Dealers

Australia and New Zealand Banking Group Limited, Barclays Bank
PLC, BNP Paribas, Citigroup Global Markets Limited,
Commerzbank Aktiengesellschaft, Credit Suisse Securities(Europe) Limited, Daiwa Securities SMBC Europe Limited,
Goldman Sachs International, HSBC Bank plc, J.P. Morgan
Securities Ltd., Merrill Lynch International, Mitsubishi UFJ
Securities International plc, Mizuho International plc, Morgan
Stanley & Co. International plc, Nomura International plc, Shinkin
International Ltd., Société Générale, Standard Bank Plc, Standard
Chartered Bank and The Toronto-Dominion Bank and any otherdealer appointed from time to time by the Bank and specified in therelevant Pricing Supplement.

Issuing and Paying Agent

Citibank, N.A. and/or such other agent(s) as may be specified in therelevant Pricing Supplement.

Registrar

Citibank, N.A. and/or such other registrar as may be specified in therelevant Pricing Supplement.

Transfer Agent

Dexia Banque Internationale à Luxembourg, société anonyme
and/or such other agent(s) as may be specified in the relevant
Pricing Supplement.

Listing Agent

Dexia Banque Internationale à Luxembourg, société anonyme
and/or such other agent(s) as may be specified in the relevant
Pricing Supplement.

Facility AmountNotes may be issued and outstanding in an unlimited aggregate
principal amount.

Availability

The Facility will be continuously available and will be uncommitted.

Form of Notes

The Notes may be issued in bearer form or in registered form. Notes
in registered form may not be exchanged for Notes in bearer form.
Notes issued in bearer form will initially be represented bytemporary global notes, which will be deposited (if the Notes are
not intended to be issued in NGN form) with a common depositaryfor Euroclear Bank SA/NV, (‘‘Euroclear’’) and/or Clearstream
Banking,société
anonyme,Luxembourg(‘‘Clearstream,
Luxembourg’’) and/or any other relevant clearing system or (if theNotes are intended to be issued in NGN form) with a common
safekeeper for Euroclear or Clearstream, Luxembourg. Eachpermanent global note will also be exchangeable in whole but notin part for Notes in definitive form in accordance with its terms.
Bearer Notes in definitive form will, if interest bearing, either haveinterest coupons attached or have a grid for recording the payment ofinterest endorsed thereon.

Clearing Systems

Notes shall be accepted for clearing through one or more clearing
systems as specified in the applicable Pricing Supplement. Thesesystems shall include, in the United States, the system operated by
The Depository Trust Company and, outside the United States, thesystems operated by Euroclear, Clearstream, Luxembourg and, inAustralia, the system operated by Austraclear Limited.
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Status of Notes

Notes may be issued as senior notes (‘‘Senior Notes’’) or
subordinated notes (‘‘Subordinated Notes’’) and will be direct,
unsecured and general obligations of the Bank.
The Senior Notes will rank pari passu without any preference one
above the other by reason of priority of date of issue, currency of
payment or otherwise with all other unsecured obligations of theBank, present and future, except to the extent that any suchobligations are by their terms expressed to be subordinated in right of
payment. The Subordinated Notes, in the event a call is made by the
Bank on its callable capital in accordance with the Agreement, will
be subordinated as provided in the Subordinated Notes to the SeniorNotes of the Bank; unless and until a call is made by the Bank, theSubordinated Notes will rank pari passu without any preference one
above the other by reason of priority of date of issue, currency of
payment or otherwise with Senior Notes of the Bank.

Interest Rates

Notes may be interest bearing or non-interest bearing. Interest (ifany) may be at a fixed or floating rate and may vary during the
lifetime of the relevant Series.

Variable Coupon Amount Notes

The Pricing Supplement issued in respect of each issue of Variable
Coupon Amount Notes will specify the basis for calculating theamounts of interest payable, which may be by reference to a variety
of financial instruments, a currency exchange rate or any other index
or formula or as otherwise provided in the relevant Pricing
Supplement.

Zero Coupon Notes

Zero Coupon Notes may be issued at a discount to par and will notbear interest.

Variable Redemption AmountNotes

The Pricing Supplement issued in respect of each issue of Variable
Redemption Amount Notes will specify the basis for calculating theredemption amounts payable, which may be by reference to a variety
of financial instruments, a currency exchange rate or any other index
or formula or as otherwise provided in the relevant Pricing
Supplement.

Other Notes

Terms applicable to High Interest Notes, Low Interest Notes, Stepup Notes, Step-Down Notes, Dual Currency Notes, Reverse Dual
Currency Notes, Optional Dual Currency Notes, Index-Linked Notes
and any other type of Notes which the Bank and any Dealer or
Dealers may agree to issue under the Facility, subject to compliancewith all applicable relevant laws, regulations and directives, will be
set out in the relevant Pricing Supplement.

Negative Pledge

The Notes have the benefit of a negative pledge in respect of
Relevant Indebtedness as more fully described under ‘‘Terms andConditions of the Notes’’.

Events of Default

The events of default under the Notes are as specified below under‘‘Terms and Conditions of the Notes’’.

Cross Default

Notes will be issued with the benefit of a cross-default provision, as
described under ‘‘Terms and Conditions of the Notes’’.

Currencies

Notes may be denominated in such currency or currency units as may
be agreed among the Bank, the relevant Dealer(s) and the Issuingand Paying Agent (including, without limitation, the Euro, theJapanese Yen, the Pound Sterling, the United States Dollar, theCanadian Dollar, the Singapore Dollar, the Swiss Franc, theAustralian Dollar and the New Zealand Dollar), subject tocompliance with all applicable legal or regulatory requirements.

7Issuance in Series

Notes will be issued in a series (each a ‘‘Series’’). The Notes of each
Series will all be subject to identical terms, whether as to currency,
interest or maturity or otherwise, or terms which are identical exceptthat the issue date, the amount of the first payment of interest and/or
the denomination thereof may be different. Each Series may
comprise one or more tranches (‘‘Tranches’’ and each, a‘‘Tranche’’) issued on different issue dates. A Series may only becomprised of Notes in bearer form or Notes in registered form.

Issue Price

Notes may be issued at par or at a discount or premium to par. Partly
paid Notes may be issued, the issue price of which will be payable intwo or more instalments.

Maturity of Notes

Notes may be issued with maturities of one day or longer as may be
agreed between the Bank and the relevant Dealer and as indicated in
the applicable Pricing Supplement, subject to such minimum or
maximum maturities as may be allowed or required from time totime by the relevant central bank (or equivalent body) or any laws or
regulations applicable to the Bank or the relevant specified currency.

Denominations

Notes will be issued in such denominations as may be agreed
between the Bank and the relevant Dealer and as specified in therelevant Pricing Supplement, subject to compliance with allapplicable legal and regulatory requirements, and in accordancewith usual market practice.

Early Redemption

Early redemption will be permitted only to the extent specified in therelevant Pricing Supplement and then only subject to any applicablelegal or regulatory limitations.

Redemption

Notes may be redeemable at par or at such other redemption amountas may be specified in the relevant Pricing Supplement.

Taxation

Each Series of Notes and the interest thereon will not be exempt
from taxation generally but, under the Agreement, are not, in certain
circumstances, subject to any tax by a member country, as more fully
described in ‘‘Taxation’’ below.

Governing Law

The Notes, all related contractual documentation and any
non-contractual obligations arising out of or in connection with theNotes or such related contractual documentation will be governedby, and construed in accordance with, English law, except asotherwise specified in the relevant Pricing Supplement.

Listing and Trading

Each Series of Notes may be listed and traded on the regulated
market of the Luxembourg Stock Exchange and/or admitted tolisting, trading and/or quotation by any other listing authority, stock
exchange, regulatory market and/or quotation system as may be
agreed between the Bank and the relevant Dealer or they may beunlisted, as specified in the relevant Pricing Supplement.

Terms and Conditions

The terms and conditions applicable to each Series (the ‘‘Terms andConditions’’) will be agreed between the Bank and the relevant
Dealer or other purchaser at or prior to the time of issuance of such
Series, and will be specified in the relevant Pricing Supplement. The
Terms and Conditions applicable to each Series will therefore bethose set out on pages 10 to 24 hereof as supplemented, modified or
replaced by the relevant Pricing Supplement.

Enforcement of Notes in Global
Form

In the case of Notes in global form, individual investors’ rights will begoverned by a Deed of Covenant dated 8 September 2009 andavailable for inspection at the specified office of the Issuing andPaying Agent.

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Pricing Supplements

The commercial terms of each trade will be set forth in Pricing
Supplements which, where applicable, will be annexed to the global
notes and (i) define the legal terms of the issue and (ii) act as amechanism for listing the Notes. For the purpose of the Luxembourg
Law on prospectuses for securities insofar as it applies to exempt
issuers under Article 1(2)(b) of the Prospectus Directive, allreferences in this document to ‘‘Pricing Supplement’’ should beread and construed as references to ‘‘Final Terms’’.

Selling Restrictions

The Dealers have undertaken to comply with appropriate UK, US,
Australian and all other applicable selling restrictions, as more fully
described in ‘‘Subscription and Sale’’ below. Further restrictions may
be required in connection with any particular Tranche of Notes andwill be specified in the documentation relating to such Tranche.

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TERMS AND CONDITIONS OF THE NOTESThe following are the Terms and Conditions of the Notes and other debt obligations issued under the
Facility which (subject to completion and amendment) will be applicable to each Series of Notes provided
that the relevant Pricing Supplement in relation to any Series of Notes may specify other Terms andConditions which shall, to the extent so specified or to the extent inconsistent with these Terms andConditions, replace the following Terms and Conditions for the purposes of such Series of Notes.
1.

GeneralUnless otherwise specified in the relevant Pricing Supplement, the notes and other debt obligations(the ‘‘Notes’’) issued under the facility (the ‘‘Facility’’) are issued with the benefit of an issuing andpaying agency agreement dated 8 September 2009 (the ‘‘Issuing and Paying Agency Agreement’’ which
expression shall include any further amendment or supplements thereto or restatements thereof) andmade between the African Development Bank (the ‘‘Bank’’) and Citibank, N.A. London as issuing andpaying agent (the ‘‘Issuing and Paying Agent’’, which expression shall include any substitute Issuing andPaying Agent successor to Citibank, N.A. in its capacity as such), Citibank, N.A. London as principal
registrar (the ‘‘Principal Registrar’’, which expression shall include any substitute Principal Registrar
successor to Citibank, N.A. in its capacity as such), The Bank of New York Mellon as first alternative
registrar (the ‘‘First Alternative Registrar’’, which expression shall include any substitute First
Alternative Registrar successor to Bank of New York Mellon in its capacity as such), Citibank, N.A.,
New York, as second alternative registrar (the ‘‘Second Alternative Registrar’’, which expression shall
include any substitute Second Alternative Registrar successor to Citibank, N.A., New York in its capacity
as such), Dexia Banque Internationale à Luxembourg, société anonyme, as transfer agent (the ‘‘Transfer
Agent’’, which expression shall include any substitute Transfer Agent successor to Dexia BanqueInternationale à Luxembourg, société anonyme, in its capacity as such) and certain other financial
institutions named therein in their capacities as paying agents (the ‘‘Paying Agents’’ which expression
shall include the Issuing and Paying Agent and any substitute or additional paying agents appointed inaccordance with the Issuing and Paying Agency Agreement). References herein to the ‘‘Registrar’’ are to
the Principal Registrar, the First Alternative Registrar, or as the case may be, the Second Alternative
Registrar as specified in the relevant Pricing Supplement relating to Registered Notes. Copies of theIssuing and Paying Agency Agreement and the form of the Notes will be available for inspection at the
specified office of each of the Paying Agents. The holders of the Notes (the ‘‘Noteholders’’) and theholders of the coupons (the ‘‘Couponholders’’ and the ‘‘Coupons’’, respectively), appertaining to interest
bearing Notes and, where applicable in the case of such Notes, talons (the ‘‘Talons’’) for further Coupons
are deemed to have notice of all the provisions of the Issuing and Paying Agency Agreement which will
be binding upon them.
2.

Form, Denomination and Title

The Notes will be issued in bearer form or in registered form and, in the case of Definitive Notes,
serially numbered, in the Specified Denomination (as specified below) and issued in series (each a‘‘Series’’), and each Series will be the subject of a pricing supplement (each a ‘‘Pricing Supplement’’)
prepared by or on behalf of the Bank, the terms set forth in which may supplement or vary any of these
Conditions. A copy of each Pricing Supplement will be available at the specified office of each of the
Paying Agents, or if the Notes form part of a Series of Registered Notes, the Transfer Agent or theRegistrar. A copy of the Pricing Supplement will be lodged with the Luxembourg Stock Exchange in thecase of each Series of Notes which is to be listed thereon. In these Conditions, ‘‘Specified
Denominations’’ means the denomination or denominations specified on such Note.
Bearer Notes
Notes issued in bearer form (‘‘Bearer Notes’’) will be represented upon issue by a temporary global
note (a ‘‘Temporary Global Note’’) in substantially the form (subject to amendment and completion)scheduled to the Issuing and Paying Agency Agreement. On or after the date (the ‘‘Exchange Date’’)which is forty days after the original issue date of the Notes of the relevant Series and provided
certification as to the non-US beneficial ownership thereof as required by US Treasury regulations has
been received by Euroclear Bank SA/NV (‘‘Euroclear’’) and/or Clearstream Banking, société anonyme,
Luxembourg (‘‘Clearstream, Luxembourg’’), interests in the Temporary Global Note may beexchanged for:

10

(i)

interests in a permanent global note (a ‘‘Permanent Global Note’’) representing the Notes inthat Series and in substantially the form (subject to amendment and completion) scheduled to
the Issuing and Paying Agency Agreement; or(ii)

if so specified in the relevant Pricing Supplement, definitive notes (‘‘Definitive Notes’’) insubstantially the form (subject to amendment and completion) scheduled to the Issuing andPaying Agency Agreement.

If any date on which a payment of interest is due on the Notes of a Series occurs whilst any of theNotes of that Series are represented by the Temporary Global Note, the related interest payment will bemade on the Temporary Global Note only to the extent that certification as to the non-US beneficial
ownership thereof as required by US Treasury regulations has been received by Euroclear and/or
Clearstream, Luxembourg or any other relevant clearing system. Payments of principal or interest (if any)
on a Permanent Global Note will be made through Euroclear, Clearstream, Luxembourg, or any otherrelevant clearing systems without any requirement for certification.
Interests in a Permanent Global Note will be exchangeable in whole but not in part only and at therequest of the holders of interests in such Permanent Global Note, for Definitive Notes (a) on the expiryof such period of notice as may be specified in the relevant Pricing Supplement provided such period is no
more than 60 days, or (b) at any time, if so specified in the relevant Pricing Supplement, or (c) if therelevant Pricing Supplement specifies ‘‘in the limited circumstances described in the Permanent Global
Note’’, then if either of the following events occurs:(i)Euroclear or Clearstream, Luxembourg or any other relevant clearing system is closed forbusiness for a continuous period of 14 days (other than by reason of legal holidays) orannounces an intention permanently to cease business or has in fact permanently ceased
business and no successor in business to such clearing system is available which will provide
clearing services on a broadly equivalent basis; or(ii)

any of the circumstances described in Condition 8 has occurred and is continuing.

In order to request such exchange the holder must deposit the relevant Permanent Global Notewith the Issuing and Paying Agent with the form of exchange notice endorsed thereon duly completed. If
the Definitive Notes have not been delivered by 6.00 p.m. (London time) on the thirtieth day after the
day on which the holder has duly requested exchange of the Permanent Global Note for Definitive Notes,
such Permanent Global Note will become void in accordance with its terms but without prejudice to therights of the account holders with Euroclear, Clearstream, Luxembourg, or any other relevant clearing
system in relation thereto under a deed of covenant (the ‘‘Deed of Covenant’’) dated 8 September 2009and executed and delivered by the Bank in relation to the Notes.
Title to the Bearer Notes will pass by delivery and, except as ordered by a court of competentjurisdiction or as required by law, the Bank and the Paying Agents shall be entitled to treat the bearer of
any Notes as the absolute owner thereof and shall not be required to obtain any proof thereof or as to theidentity of the bearer. References herein to the ‘‘Holders’’ of Bearer Notes, Coupons or Talons signify
the bearers of such Bearer Notes, such Coupons or such Talons.
The Holder of any Bearer Note, Coupon or Talon will (except as otherwise required by applicablelaw or regulatory requirement) be treated as its absolute owner for all purposes (whether or not it isoverdue and regardless of any notice of ownership, trust or any interest thereof or therein, any writing
thereon, or any theft or loss thereof) and no person shall be liable for so treating such Holder.
Registered Notes
Unless otherwise specified in the relevant Pricing Supplement, Notes issued in registered form(‘‘Registered Notes’’) will be in substantially the form (subject to amendment and completion) scheduledin the Issuing and Paying Agency Agreement. Registered Notes will not be exchangeable for Bearer
Notes.
Registered Notes denominated in United States dollars will, if so specified in the relevant Pricing
Supplement, be the subject of an application by the Bank to The Depository Trust Company (‘‘DTC’’)for the acceptance of such Registered Notes into DTC’s book-entry settlement system. If such applicationis accepted, one or more Registered Notes (each a ‘‘DTC Note’’) in denominations equivalent inaggregate to the aggregate principal amount of relevant Registered Notes which are to be held in such
system will be issued to DTC and registered in the name of Cede Co., or such other person as may be
nominated by DTC for the purpose, as nominee for DTC provided that no DTC Note may have a11denomination of more than US$500,000,000 and that, subject to such restriction, DTC Notes will always
be issued in the largest possible denomination. Thereafter, such registered nominee will be the holder ofrecord and entitled to rights in respect of each DTC Note.
Accordingly, each person having a beneficial interest in a DTC Note must rely on the procedures of
the institutions having accounts with DTC to exercise any rights of such person. So long as Registered
Notes are traded through DTC’s book-entry settlement system, ownership of beneficial interest in therelevant DTC Note will (unless otherwise required by applicable law or regulatory requirement) be
shown on, and transfers of such beneficial interest may be effected only through, records maintained by(a) DTC or its registered nominee (as to Participant-interests) or (b) institutions having accounts with
DTC.
Title to Registered Notes passes by registration in the register which is kept by the Registrar.
References herein to the ‘‘Holders’’ of Registered Notes signify the persons in whose names such Notes
are so registered.
A Registered Note may, upon the terms and subject to the conditions set forth in the Issuing andPaying Agency Agreement, be transferred in whole or in part only (provided that such part is, or is an
integral multiple of, the minimum denomination specified in the relevant Pricing Supplement) upon thesurrender of the Registered Note to be transferred, together with the form of transfer endorsed on it duly
completed and executed, at the specified office of the Registrar or the Transfer Agent. A new Registered
Note will be issued in favour of the transferee and, in the case of a transfer of part only of a RegisteredNote, a new Registered Note in respect of the balance not transferred will be issued in favour of thetransferor.
No Noteholder may require the transfer of a Registered Note to be registered (i) during the periodof 15 days ending on the due date for redemption of, or payment of any Instalment Amount in respect of,that Note, (ii) during the period of 15 days before any date on which Notes may be called for redemption
by the Bank at its option pursuant to Condition 5, (iii) after any such Note has been called for redemptionor (iv) during the period of seven days ending on (and including) any Record Date.
Each new Registered Note to be issued upon the transfer of Registered Notes will, upon theeffective receipt of such form of transfer by the Registrar or the Transfer Agent at its specified office, beavailable for delivery at the specified office of the Registrar or the Transfer Agent. For these purposes, aform of transfer received by the Registrar or the Transfer Agent during the period of fifteen London
Banking Days or, as the case may be, Relevant Banking Days ending on the due date for any payment on
the relevant Registered Notes shall be deemed not to be effectively received by the Registrar or theTransfer Agent until the day following the due date for such payment. For the purposes of these terms
and conditions (‘‘Terms and Conditions’’), ‘‘London Banking Day’’ means a day on which commercial
banks are open for business (including dealings in foreign exchange and foreign currency deposits) in
London and ‘‘Relevant Banking Day’’ means a day on which commercial banks are open for business(including dealings in foreign exchange and foreign currency deposits) in the places where the specified
offices of the Registrar and the Transfer Agent are located.
The issue of new Registered Notes on transfer will be effected without charge by or on behalf of the
Bank or the Registrar, but upon payment by the applicant of (or the giving by the applicant of suchindemnity as the Registrar may require in respect of) any applicable tax or other government charges
imposed in relation thereto.
3.

Status, Negative Pledge and Undertaking
Notes may be issued as senior notes (the ‘‘Senior Notes’’) or subordinated notes (the ‘‘SubordinatedNotes’’). The Notes are not the obligations of any government. The obligations deriving from the Notes
will be direct, unsecured and general obligations of the Bank. The Senior Notes and Coupons will rankpari passu and without any preference one above the other by reason of priority of date of issue, currencyof payment or otherwise with all other unsecured obligations of the Bank, present and future, except tothe extent that any such other obligations are by their terms expressed to be subordinated in right of
payment.
In the event that a call is made by the Bank on its callable capital in accordance with theAgreement, the rights of holders of Subordinated Notes to receive any payment shall be subordinated to
the repayment in full of all secured and unsecured creditors of the Bank which are not expressly sosubordinated. Unless and until a call is made by the Bank, the Subordinated Notes will rank pari passu

12

without any preference one above the other by reason of priority of date of issue, currency, payment orotherwise with Senior Notes of the Bank.
As long as any of the Notes shall remain outstanding and unpaid but only up to the time all amounts
of principal and, where applicable, interest due in respect of the notes have been paid to the Issuing andPaying Agent, the Bank will not cause or permit to be created on any of its present or future property orassets any mortgage, pledge or other lien or charge as security for any Relevant Indebtedness issued,
assumed or guaranteed by the Bank, unless the Notes shall be secured by such mortgage, pledge or otherlien or charge so as to rank pari passu in point of security and rateably with such Relevant Indebtedness.
In these Conditions:
Relevant Indebtedness means any indebtedness which is in the form of, or represented or evidenced
by, bonds, notes, debentures, loan stock or other securities which for the time being are, or are intended
to be or capable of being, quoted, listed or dealt in or traded on any stock exchange or over-the-counteror other securities market having an original maturity of more than one year from its original dateof issue.
The Bank undertakes that, in the event of a call on the callable capital of the Bank, it will instruct its
members to make payments in satisfaction of such call into an account established with the Federal
Reserve Bank of New York (or its successor duly designated for the purpose) on the terms that theproceeds of any such call shall be applied in payment of, or provision for full settlement of, outstanding
obligations of the Bank incurred by it in the exercise of its powers to borrow and give guarantees (otherthan such obligations which by their terms are expressed to be subordinated in right of payment) before
any other payment shall be made with such call proceeds. The Bank shall be entitled, without the consent
of the Noteholders, to agree to any amendments to the agreement between the Bank and the Federal
Reserve Bank of New York (or its successor duly designated for the purpose) relating to theestablishment of the said account, provided that such amendments are not inconsistent with the foregoingundertaking. If such a call is made, the obligation of the Bank in respect of Subordinated Notes shallbecome subordinated to the obligation of the Bank in respect of Senior Notes in right of payment and,accordingly, the Bank will not make any payment to the holders of Subordinated Notes and the Bank
may not acquire any Subordinated Notes until all holders of Senior Notes outstanding at the date of suchcall are paid in full or are adequately (in the opinion of the Board of Directors of the Bank), provided for.
The Bank shall within a reasonable time of any such call apply the proceeds of any such call, any liquid
assets of the Bank and any of its investments which are capable of realisation within a reasonable time to
pay in full or adequately (in the opinion of the Board of Directors of the Bank) provide for, all of the
Senior Notes outstanding at the date of such call. Notwithstanding the foregoing the Bank shall not be
obliged (by virtue of these provisions) to make any further call on its members or to realise or demand
early repayment of loans or to rescind or cancel guarantees made by it to its borrowers or given to secureindebtedness. Upon any distribution to creditors of the Bank following a call on its callable capital, theholders of Senior Notes will be entitled to receive payment in full before the holders of SubordinatedNotes will be entitled to receive any payment.
4.

Interest

Each Fixed Rate Note will bear interest on its outstanding nominal amount from the Interest
Commencement Date at the rate per annum (expressed as a percentage) equal to the Rate of Interest,
such interest being payable in arrear on each Interest Payment Date.
If a Fixed Coupon Amount or a Broken Amount is specified in the relevant Pricing Supplement, theamount of interest payable on each Interest Payment Date will amount to the Fixed Coupon Amount or,if applicable, the Broken Amount so specified and in the case of the Broken Amount will be payable on
the particular Interest Payment Date(s) specified in the relevant Pricing Supplement.
Each Floating Rate Note and Index Linked Interest Note will bear interest on its outstanding
nominal amount from the Interest Commencement Date at the rate per annum (expressed as apercentage) equal to the Rate of Interest, such interest being payable in arrear on each Interest Payment
Date. Such Interest Payment Date(s) is/are either shown in the relevant Pricing Supplement as Specified
Interest Payment Dates or, if no Specified Interest Payment Date(s) is/are shown in the relevant Pricing
Supplement, Interest Payment Date shall mean each date which falls the number of months or otherperiod shown in the relevant Pricing Supplement as the Interest Period after the preceding Interest
Payment Date or, in the case of the first Interest Payment Date, after the Interest Commencement Date.

13

If any date referred to in these Conditions that is specified to be subject to adjustment in accordancewith a Business Day Convention would otherwise fall on a day that is not a Business Day, then, if theBusiness Day Convention specified is (A) the Floating Rate Business Day Convention, such date shall be
postponed to the next day that is a Business Day unless it would thereby fall into the next calendar
month, in which event (x) such date shall be brought forward to the immediately preceding Business Dayand (y) each subsequent such date shall be the last Business Day of the month in which such date would
have fallen had it not been subject to adjustment, (B) the Following Business Day Convention, such dateshall be postponed to the next day that is a Business Day, (C) the Modified Following Business Day
Convention, such date shall be postponed to the next day that is a Business Day unless it would thereby
fall into the next calendar month, in which event such date shall be brought forward to the immediately
preceding Business Day or (D) the Preceding Business Day Convention, such date shall be brought
forward to the immediately preceding Business Day.
The Rate of Interest in respect of Floating Rate Notes for each Interest Accrual Period shall be
determined in the manner specified in the relevant Pricing Supplement and the provisions below relating
to either ISDA Determination or Screen Rate Determination shall apply, depending upon which is
specified in the relevant Pricing Supplement.
ISDA Determination for Floating Rate Notes: Where ISDA Determination is specified in therelevant Pricing Supplement as the manner in which the Rate of Interest is to be determined, the Rate ofInterest for each Interest Accrual Period shall be determined by the Calculation Agent as a rate equal to
the relevant ISDA Rate plus or minus (as indicated in the relevant Pricing Supplement) the Margin (ifany). For the purposes of this sub-paragraph, ‘‘ISDA Rate’’ for an Interest Accrual Period means a rateequal to the Floating Rate that would be determined by the Calculation Agent under a Swap Transaction
under the terms of an agreement incorporating the ISDA Definitions and under which:(x)

the Floating Rate Option is as specified in the relevant Pricing Supplement(y)the Designated Maturity is a period specified in the relevant Pricing Supplement and(z)

the relevant Reset Date is the first day of that Interest Accrual Period unless otherwise
specified in the relevant Pricing Supplement.

For the purposes of this sub-paragraph, ‘‘Floating Rate’’, ‘‘Calculation Agent’’, ‘‘Floating Rate
Option’’, ‘‘Designated Maturity’’, ‘‘Reset Date’’ and ‘‘Swap Transaction’’ have the meanings given to
those terms in the ISDA Definitions.
Screen Rate Determination for Floating Rate Notes: Where Screen Rate Determination is specified
in the relevant Pricing Supplement as the manner in which the Rate of Interest is to be determined, theRate of Interest for each Interest Accrual Period shall be determined by the Calculation Agent at or
about the Relevant Time on the Interest Determination Date in respect of such Interest Accrual Period
in accordance with the following:(x)

if the Primary Source for Floating Rate is a Page, subject as provided below, the Rate ofInterest shall be:(I)

the Relevant Rate (where such Relevant Rate on such Page is a composite quotation oris customarily supplied by one entity); or(II) the arithmetic mean of the Relevant Rates of the persons whose Relevant Rates appear
on that Page,
in each case appearing on such Page at the Relevant Time on the Interest Determination
Date;
(y)

if the Primary Source for the Floating Rate is Reference Banks or if sub-paragraph (x)(I)applies and no Relevant Rate appears on the Page at the Relevant Time on the Interest
Determination Date or if sub-paragraph (x)(II) applies and fewer than two Relevant Rates
appear on the Page at the Relevant Time on the Interest Determination Date, subject asprovided below, the Rate of Interest shall be the arithmetic mean of the Relevant Rates thateach of the Reference Banks is quoting to leading banks in the Relevant Financial Centre at
the Relevant Time on the Interest Determination Date, as determined by the Calculation
Agent; and(z)

if paragraph (y) above applies and the Calculation Agent determines that fewer than two
Reference Banks are so quoting Relevant Rates, subject as provided below, the Rate of14

Interest shall be the arithmetic mean of the rates per annum (expressed as a percentage) that
the Calculation Agent determines to be the rates (being the nearest equivalent to the
Benchmark) in respect of a Representative Amount of the Specified Currency that at least two
out of five leading banks selected by the Calculation Agent in the principal financial centre of
the country of the Specified Currency or, if the Specified Currency is euro, in the Euro-zone asselected by the Calculation Agent (the ‘‘Principal Financial Centre’’) are quoting at or about
the Relevant Time on the date on which such banks would customarily quote such rates for aperiod commencing on the Effective Date for a period equivalent to the Specified Duration (I)to leading banks carrying on business in Europe, or (if the Calculation Agent determines thatfewer than two of such banks are so quoting to leading banks in Europe) (II) to leading banks
carrying on business in the Principal Financial Centre; except that, if fewer than two of suchbanks are so quoting to leading banks in the Principal Financial Centre, the Rate of Interest
shall be the Rate of Interest determined on the previous Interest Determination Date (after
readjustment for any difference between any Margin, Rate Multiplier or Maximum or
Minimum Rate of Interest applicable to the preceding Interest Accrual Period and to therelevant Interest Accrual Period).
The Rate of Interest in respect of Index Linked Interest Notes for each Interest Accrual Period
shall be determined in the manner specified in the relevant Pricing Supplement and interest will accrue by
reference to an Index or Formula as specified in the relevant Pricing Supplement.
Where a Note the Interest Basis of which is specified to be Zero Coupon is repayable prior to the
Maturity Date and is not paid when due, the amount due and payable prior to the Maturity Date shall be
the Early Redemption Amount of such Note. As from the Maturity Date, the Rate of Interest for any
overdue principal of such a Note shall be a rate per annum (expressed as a percentage) equal to theAmortisation Yield as provided in the relevant Pricing Supplement.
In the case of Dual Currency Notes, if the rate or amount of interest falls to be determined byreference to a Rate of Exchange or a method of calculating Rate of Exchange, the rate or amount ofinterest payable shall be determined in the manner specified in the relevant Pricing Supplement.
In the case of Partly Paid Notes (other than Partly Paid Notes which are Zero Coupon Notes),interest will accrue as aforesaid on the paid-up nominal amount of such Notes and otherwise as specified
in the relevant Pricing Supplement.
Interest shall cease to accrue on each Note on the due date for redemption unless, upon due
presentation, payment is improperly withheld or refused, in which event interest shall continue to accrue(as well after as before judgment) at the Rate of Interest in the manner provided in this Condition 4 to theRelevant Date. As used in these Conditions, ‘‘Relevant Date’’ in respect of any Note, Receipt or Coupon
means the date on which payment in respect of it first becomes due or (if any amount of the money
payable is improperly withheld or refused) the date on which payment in full of the amount outstanding is
made or (if earlier) the date seven days after that on which notice is duly given to the Noteholders that,upon further presentation of the Note (or relative Certificate), Receipt or Coupon being made inaccordance with the Conditions, such payment will be made, provided that payment is in fact made uponsuch presentation. References in these Conditions to (i) ‘‘principal’’ shall be deemed to include any
premium payable in respect of the Notes, all Instalment Amounts, Final Redemption Amounts, Early
Redemption Amounts, Optional Redemption Amounts, Amortised Face Amounts and all other amounts
in the nature of principal payable pursuant to Condition 6 or any amendment or supplement to it, (ii)‘‘interest’’ shall be deemed to include all Interest Amounts and all other amounts payable pursuant tothis Condition 4 or any amendment or supplement to it and (iii) ‘‘principal’’ and/or ‘‘interest’’ shall bedeemed to include any additional amounts that may be payable under the Conditions.
If any Margin or Rate Multiplier is specified in the relevant Pricing Supplement (either (x)generally, or (y) in relation to one or more Interest Accrual Periods), an adjustment shall be made to all
Rates of Interest, in the case of (x), or the Rates of Interest for the specified Interest Accrual Periods, inthe case of (y), by adding (if a positive number) or subtracting the absolute value (if a negative number)of such Margin or multiplying by such Rate Multiplier, subject always to the next paragraph.
If any Maximum or Minimum Rate of Interest, Instalment Amount or Redemption Amount is
specified in the relevant Pricing Supplement, then any Rate of Interest, Instalment Amount or
Redemption Amount shall be subject to such maximum or minimum, as the case may be.
For the purposes of any calculations required pursuant to these Conditions (unless otherwise
specified), (x) all percentages resulting from such calculations shall be rounded, if necessary, to the15nearest one hundred-thousandth of a percentage point (with halves being rounded up), (y) all figures shallbe rounded to seven significant figures (with halves being rounded up) and (z) all currency amounts thatfall due and payable shall be rounded to the nearest unit of such currency (with halves being rounded up),save in the case of yen, which shall be rounded down to the nearest yen. For these purposes ‘‘unit’’ means
the lowest amount of such currency that is available as legal tender in the country or countries of suchcurrency.
The amount of interest payable in respect of any Note for any period shall be calculated bymultiplying the product of the Rate of Interest and the outstanding nominal amount of such Note by the
Day Count Fraction, unless an Interest Amount (or a formula for its calculation) is specified in respect ofsuch period, in which case the amount of interest payable in respect of such Note for such period shallequal such Interest Amount (or be calculated in accordance with such formula). Where any Interest
Period comprises two or more Interest Accrual Periods, the amount of interest payable in respect of such
Interest Period shall be the sum of the amounts of interest payable in respect of each of those Interest
Accrual Periods.
As soon as practicable after the Relevant Time on such date as the Calculation Agent may berequired to calculate any rate or amount, obtain any quotation or make any determination or calculation,
it shall determine such rate and calculate the Interest Amounts in respect of each Specified
Denomination of the Notes for the relevant Interest Accrual Period, calculate the Final Redemption
Amount, Early Redemption Amount, Optional Redemption Amount or Instalment Amount, obtain suchquotation or make such determination or calculation, as the case may be, and cause the Rate of Interestand the Interest Amounts for each Interest Period and the relevant Interest Payment Date and, if
required to be calculated, the Final Redemption Amount, Early Redemption Amount, Optional
Redemption Amount or any Instalment Amount to be notified to the Fiscal Agent, the Bank, each of the
Paying Agents, the Noteholders, any other Calculation Agent appointed in respect of the Notes that is tomake a further calculation upon receipt of such information and, if the Notes are listed on a stock
exchange and the rules of such exchange or other relevant authority so require, such exchange or otherrelevant authority as soon as possible after their determination but in no event later than (i) thecommencement of the relevant Interest Period, if determined prior to such time, in the case of
notification to such exchange of a Rate of Interest and Interest Amount, or (ii) in all other cases, thefourth Business Day after such determination. Where any Interest Payment Date or Interest Period Dateis subject to adjustment pursuant to this Condition 4, the Interest Amounts and the Interest Payment
Date so published may subsequently be amended (or appropriate alternative arrangements made by wayof adjustment) without notice in the event of an extension or shortening of the Interest Period. If theNotes become due and payable under Condition 8, the accrued interest and the Rate of Interest payable
in respect of the Notes shall nevertheless continue to be calculated as previously in accordance with thisCondition but no publication of the Rate of Interest or the Interest Amount so calculated need be made.
The determination of any rate or amount, the obtaining of each quotation and the making of eachdetermination or calculation by the Calculation Agent(s) shall (in the absence of manifest error) be final
and binding upon all parties.
Calculation Agent and Reference Banks: The Bank shall procure that there shall at all times be four
Reference Banks (or such other number as may be required) with offices in the Relevant Financial
Centre and one or more Calculation Agents if provision is made for them in the relevant Pricing
Supplement and for so long as any Note is outstanding. If any Reference Bank (acting through its
relevant office) is unable or unwilling to continue to act as a Reference Bank, then the Bank shall appoint
another Reference Bank with an office in the Relevant Financial Centre to act as such in its place. Where
more than one Calculation Agent is appointed in respect of the Notes, references in these Conditions to
the Calculation Agent shall be construed as each Calculation Agent performing its respective duties
under the Conditions. If the Calculation Agent is unable or unwilling to act as such or if the Calculation
Agent fails duly to establish the Rate of Interest for an Interest Period or Interest Accrual Period or to
calculate any Interest Amount, Instalment Amount, Final Redemption Amount, Early Redemption
Amount or Optional Redemption Amount, as the case may be, or to comply with any other requirement,
the Bank shall appoint a leading bank or investment banking firm engaged in the interbank market (or, if
appropriate, money, swap or over-the-counter index options market) that is most closely connected withthe calculation or determination to be made by the Calculation Agent (acting through its principal
London office or any other office actively involved in such market) to act as such in its place. The
Calculation Agent may not resign its duties without a successor having been appointed as aforesaid.

16

Interest — Supplemental Provision
The following Conditions shall be applicable (as appropriate) in relation to all Notes which areinterest bearing.
‘‘Business Day’’ means:(i)in the case of a currency other than euro, a day (other than a Saturday or Sunday) on which
commercial banks and foreign exchange markets settle payments in the principal financial
centre for such currency and/or(ii)

in the case of euro, a day on which the TARGET2 system is operating (a ‘‘TARGET BusinessDay’’) and/or(iii) in the case of a currency and/or one or more Business Centres, a day (other than a Saturday or
a Sunday) on which commercial banks and foreign exchange markets settle payments in suchcurrency in the Business Centre(s) or, if no currency is indicated, generally in each of theBusiness Centres‘‘Day Count Fraction’’ means, in respect of the calculation of an amount of interest on any Note forany period of time (from and including the first day of such period to but excluding the last)(whether or not constituting an Interest Period, the ‘‘Calculation Period’’):(i)if ‘‘Actual/Actual (ISDA)’’ or ‘‘Actual/Actual’’ is specified in the relevant Pricing
Supplement, the actual number of days in the Calculation Period divided by 365 (or, if any
portion of that Calculation Period falls in a leap year, the sum of (A) the actual number ofdays in that portion of the Calculation Period falling in a leap year divided by 366 and (B) the
actual number of days in that portion of the Calculation Period falling in a non-leap year
divided by 365)(ii)

if ‘‘Actual/365 (Fixed)’’ is specified in the relevant Pricing Supplement, the actual number ofdays in the Calculation Period divided by 365(iii) if ‘‘Actual/365 (Sterling)’’ is specified in the relevant Pricing Supplement, the actual number ofdays in the Interest Period divided by 365 or, in the case of an Interest Payment Date falling ina leap year, 366;
(iv) if ‘‘Actual/360’’ is specified in the relevant Pricing Supplement, the actual number of days in
the Calculation Period divided by 360(v)

if ‘‘30/360’’, ‘‘360/360’’ or ‘‘Bond Basis’’ is specified in the relevant Pricing Supplement inrelation to Notes other than Fixed Rate Notes, the number of days in the Calculation Period
divided by 360, calculated on a formula basis as follows:[360 x (Y2 – Y1)] + [30 x (M2 – M1)] + (D2 – D1)
Day Count Fraction =360

where:‘‘Y1" is the year, expressed as a number, in which the first day of the Interest Period falls;‘‘Y2’’ is the year, expressed as a number, in which the day immediately following the last dayof the Interest Period falls;‘‘M1’’ is the calendar month, expressed as a number, in which the first day of the Interest
Period falls;‘‘M2’’ is the calendar month, expressed as a number, in which the day immediately following
the last day of the Interest Period falls;‘‘D1’’ is the first calendar day, expressed as a number, of the Interest Period, unless such
number is 31, in which case D1 will be 30; and‘‘D2’’ is the calendar day, expressed as a number, immediately following the last day includedin the Interest Period, unless such number would be 31 and D1 is greater than 29, in which caseD2 will be 30

17

(vi) if ‘‘30/360’’ is specified in the relevant Pricing Supplement in relation to Fixed Rate Notes, thenumber of days in the period from (and including) the most recent Interest Payment Date (or,if none, the Interest Commencement Date) to (but excluding) the relevant payment date (suchnumber of days being calculated on the basis of a year of 360 days with 12 30-day months)
divided by 360;(vii) if ‘‘30E/360’’ or ‘‘Eurobond Basis’’ is specified in the relevant Pricing Supplement, the numberof days in the Calculation Period divided by 360, calculated on a formula basis as follows:[360 x (Y2 – Y1)] + [30 x (M2 – M1)] + (D2 – D1)
Day Count Fraction =360

where:‘‘Y1’’ is the year, expressed as a number, in which the first day of the Interest Period falls;‘‘Y2’’ is the year, expressed as a number, in which the day immediately following the last dayof the Interest Period falls;‘‘M1’’ is the calendar month, expressed as a number, in which the first day of the Interest
Period falls;‘‘M2’’ is the calendar month, expressed as a number, in which the day immediately following
the last day of the Interest Period falls;‘‘D1’’ is the first calendar day, expressed as a number, of the Interest Period, unless such
number would be 31, in which case D1 will be 30; and‘‘D2’’ is the calendar day, expressed as a number, immediately following the last day includedin the Interest Period, unless such number would be 31, in which case D2 will be 30(viii) if ‘‘30E/360 (ISDA)’’ is specified in the relevant Pricing Supplement, the number of days in theInterest Period divided by 360, calculated on a formula basis as follows:[360 x (Y2 – Y1)] + [30 x (M2 – M1)] + (D2 – D1)
Day Count Fraction =360

where:‘‘Y1’’ is the year, expressed as a number, in which the first day of the Interest Period falls;‘‘Y2’’ is the year, expressed as a number, in which the day immediately following the last dayof the Interest Period falls;‘‘M1’’ is the calendar month, expressed as a number, in which the first day of the Interest
Period falls;‘‘M2’’ is the calendar month, expressed as a number, in which the day immediately following
the last day of the Interest Period falls;‘‘D1’’ is the first calendar day, expressed as a number, of the Interest Period, unless (i) that day
is the last day of February or (ii) such number would be 31, in which case D1 will be 30; and‘‘D2’’ is the calendar day, expressed as a number, immediately following the last day includedin the Interest Period, unless (i) that day is the last day of February but not the Maturity Dateor (ii) such number would be 31, in which case D2 will be 30(ix) if ‘‘Actual/Actual-ICMA’’ is specified in the relevant Pricing Supplement,(a)if the Calculation Period is equal to or shorter than the Determination Period during
which it falls, the number of days in the Calculation Period divided by the product of (x)the number of days in such Determination Period and (y) the number of Determination
Periods normally ending in any year; and(b)

if the Calculation Period is longer than one Determination Period, the sum of:

18

(x)

the number of days in such Calculation Period falling in the Determination Period
in which it begins divided by the product of (1) the number of days in such
Determination Period and (2) the number of Determination Periods normallyending in any year; and(y)the number of days in such Calculation Period falling in the next Determination
Period divided by the product of (1) the number of days in such Determination
Period and (2) the number of Determination Periods normally ending in any year

where:‘‘Determination Period’’ means the period from and including a Determination Date in any year tobut excluding the next Determination Date and‘‘Determination Date’’ means the date specified as such in the relevant Pricing Supplement or, if
none is so specified, the Interest Payment Date‘‘Effective Date’’ means, with respect to any Floating Rate to be determined on an Interest
Determination Date, the date specified as such in the relevant Pricing Supplement or, if none is so
specified, the first day of the Interest Accrual Period to which such Interest Determination Date
relates‘‘Euro-zone’’ means the region comprised of member states of the European Union that adopt thesingle currency in accordance with the Treaty establishing the European Community, as amended‘‘Interest Accrual Period’’ means the period beginning on (and including) the Interest
Commencement Date and ending on (but excluding) the first Interest Period Date and eachsuccessive period beginning on (and including) an Interest Period Date and ending on (butexcluding) the next succeeding Interest Period Date‘‘Interest Amount’’ means the amount of interest payable, and in the case of Fixed Rate Notes,
means the Fixed Coupon Amount or Broken Amount, as the case may be‘‘Interest Commencement Date’’ means the Issue Date or such other date as may be specified in therelevant Pricing Supplement‘‘Interest Determination Date’’ means, with respect to a Rate of Interest and Interest Accrual
Period, the date specified as such in the relevant Pricing Supplement or, if none is so specified, (i)the first day of such Interest Accrual Period if the Specified Currency is Sterling or (ii) the day
falling two Business Days in London for the Specified Currency prior to the first day of such Interest
Accrual Period if the Specified Currency is neither Sterling nor euro or (iii) the day falling two
TARGET Business Days prior to the first day of such Interest Accrual Period if the Specified
Currency is euro‘‘Interest Period’’ means the period beginning on (and including) the Interest Commencement Dateand ending on (but excluding) the first Interest Payment Date and each successive period beginningon (and including) an Interest Payment Date and ending on (but excluding) the next succeeding
Interest Payment Date‘‘Interest Period Date’’ means each Interest Payment Date unless otherwise specified in therelevant Pricing Supplement‘‘ISDA Definitions’’ means the 2006 ISDA Definitions, as published by the International Swaps andDerivatives Association, Inc., unless otherwise specified in the relevant Pricing Supplement‘‘Page’’ means such page, section, caption, column or other part of a particular information service(including, but not limited to, Reuters Markets 3000 (‘‘Reuters’’)) as may be specified for the
purpose of providing a Relevant Rate, or such other page, section, caption, column or other part as
may replace it on that information service or on such other information service, in each case as may
be nominated by the person or organisation providing or sponsoring the information appearing
there for the purpose of displaying rates or prices comparable to that Relevant Rate‘‘Rate of Interest’’ means the rate of interest payable from time to time in respect of this Note andthat is either specified or calculated in accordance with the provisions in the relevant Pricing
Supplement‘‘Reference Banks’’ means the institutions specified as such in the relevant Pricing Supplement or, if
none, four major banks selected by the Calculation Agent in the interbank market (or, if
19

appropriate, money, swap or over-the-counter index options market) that is most closely connectedwith the Benchmark (which, if EURIBOR is the relevant Benchmark, shall be the Euro-zone)‘‘Relevant Financial Centre’’ means, with respect to any Floating Rate to be determined inaccordance with a Screen Rate Determination on an Interest Determination Date, the financial
centre as may be specified as such in the relevant Pricing Supplement or, if none is so specified, thefinancial centre with which the relevant Benchmark is most closely connected (which, in the case of
EURIBOR, shall be the Euro-zone) or, if none is so connected, London‘‘Relevant Rate’’ means the Benchmark for a Representative Amount of the Specified Currency fora period (if applicable or appropriate to the Benchmark) equal to the Specified Durationcommencing on the Effective Date‘‘Relevant Time’’ means, with respect to any Interest Determination Date, the local time in the
Relevant Financial Centre specified in the relevant Pricing Supplement or, if no time is specified,the local time in the Relevant Financial Centre at which it is customary to determine bid andoffered rates in respect of deposits in the Specified Currency in the interbank market in the
Relevant Financial Centre or, if no such customary local time exists, 11.00 hours in the Relevant
Financial Centre and, for the purpose of this definition, ‘‘local time’’ means, with respect to Europe
and the Euro-zone as a Relevant Financial Centre, Brussels Time‘‘Representative Amount’’ means, with respect to any Floating Rate to be determined inaccordance with a Screen Rate Determination on an Interest Determination Date, the amountspecified as such in the relevant Pricing Supplement or, if none is specified, an amount that isrepresentative for a single transaction in the relevant market at the time‘‘Specified Currency’’ means the currency specified as such in the relevant Pricing Supplement or, if
none is specified, the currency in which the Notes are denominated‘‘Specified Duration’’ means, with respect to any Floating Rate to be determined in accordance witha Screen Rate Determination on an Interest Determination Date, the duration specified in therelevant Pricing Supplement or, if none is specified, a period of time equal to the relative Interest
Accrual Period, ignoring any adjustment pursuant to Condition 4.
‘‘TARGET2 System’’ means the Trans-European Automated Real-Time Gross Settlement Express
Transfer (known as TARGET2) System or any successor thereto.
5.

Redemption and Purchase
Unless previously redeemed, or purchased and cancelled, Notes shall be redeemed by the Bank attheir principal amount or at such other redemption amount as may be specified in or determined in themanner specified in the relevant Pricing Supplement. The Bank may (save as otherwise specified in therelevant Pricing Supplement) at any time purchase Notes and Coupons in the open market, by private
treaty, tender offer or otherwise. Any Notes or Coupons so purchased may be held or resold or, at thediscretion of the Bank, delivered to the Issuing and Paying Agent for cancellation. Any Notes sosurrendered for cancellation may not be reissued or resold and the obligations of the Bank in respect ofany such Notes shall be discharged.
Redemption by Instalments
Unless previously redeemed, purchased and cancelled as provided in this Condition 5, each Notethat provides for Instalment Dates and Instalment Amounts shall be partially redeemed on each
Instalment Date at the related Instalment Amount specified hereon. The outstanding nominal amount ofeach such Note shall be reduced by the Instalment Amount (or, if such Instalment Amount is calculated
by reference to a proportion of the nominal amount of such Note, such proportion) for all purposes witheffect from the related Instalment Date, unless payment of the Instalment Amount is improperly
withheld or refused, in which case, such amount shall remain outstanding until the Relevant Date relating
to such Instalment Amount.
Optional Early Redemption (Put)
If the relevant Pricing Supplement so specifies, the Bank shall, upon the exercise of the relevant
option by the Holder of any Note of the relevant Series by giving to the Bank, in accordance with
Condition 11, not less than 15 nor more than 30 days’ notice of its intention to exercise the option, redeem
such Note on the date or the next of the dates specified in the relevant Pricing Supplement at its principal
20

amount (or such other redemption amount as may be specified in the relevant Pricing Supplement),
together with accrued interest (if any) thereon. In order to exercise such option, the Holder must, not lessthan forty-five days before the date so specified (or such other period as may be specified in the relevant
Pricing Supplement), deposit the relevant Note (together, in the case of an interest bearing Definitive
Note, with any unmatured Coupons appertaining thereto) with, in the case of a Bearer Note, any Paying
Agent or, in the case of a Registered Note, the Registrar together with a duly completed redemption
notice in the form which is available from the specified office of any of the Paying Agents or, as the casemay be, the Registrar or, in the case of a Permanent Global Note, with the form of redemption noticeendorsed thereon duly completed.
Optional Early Redemption (Call)
If the relevant Pricing Supplement so specifies, then the Bank may, having given:(i)

not less than 15 nor more than 30 days’ notice to the Holders of the Notes in accordance with
Condition 11; and(ii)

not less than 15 days before the giving of the notice referred to in (i) above, notice to theIssuing and Paying Agent, andsubject to such conditions as may be specified in the relevant Pricing Supplement, redeem all(but not, unless and to the extent that the relevant Pricing Supplement specifies otherwise,some only), of the Notes of the relevant Series on the date specified in the relevant Pricing
Supplement.

Partial Redemption
If the Notes of a Series are to be redeemed at the option of the Bank in part only on any date inaccordance with this Condition 5:(i)in the case of Bearer Notes, the Notes to be redeemed shall be drawn by lot in such European
city as the Issuing and Paying Agent may specify, or identified in such other manner or in suchother place as the Issuing and Paying Agent may approve and deem appropriate and fair;(ii)

in the case of a Temporary Bearer Global Note or a Permanent Bearer Global Note, theNotes to be redeemed shall be selected in accordance with the rules of Euroclear and/or
Clearstream, Luxembourg and/or any other relevant clearing system (to be reflected in therecords of Euroclear and Clearstream, Luxembourg as either a pool factor or by a reduction in
nominal amount, at their discretion); and(iii) in the case of Registered Notes, the Notes shall be redeemed (so far as may be practicable) pro
rata to their principal amounts, provided always that the amount redeemed in respect of each
Note shall be equal to the minimum denomination thereof or an integral multiple thereof,
subject always to compliance with all applicable laws and the requirements of any stock
exchange on which the relevant Notes may be listed.
In the case of the redemption of part only of a Registered Note, a new Registered Note in respect of
the unredeemed balance shall be issued in accordance with the relevant provisions of Condition 2 whichshall apply as in the case of a transfer of Registered Notes as if such new Registered Note were in respectof the untransferred balance.
6.
Payments
Bearer Notes
Payment of amounts (including any accrued interest) due on the redemption of Bearer Notes will bemade against presentation and, save in the case of a partial redemption by reason of insufficiency offunds, surrender of the relevant Bearer Notes at the specified office of any of the Paying Agents outside
the United States.
Payment of amounts due in respect of interest on Bearer Notes will be made:(i)in the case of a Temporary Global Note or Permanent Global Note, against presentation of
the relevant Temporary Global Note or Permanent Global Note at the specified office of anyof the Paying Agents outside the United States and, in the case of a Temporary Global Note,
upon due certification of non-US ownership (except with respect to Notes having a maturity ofless than one year, in which case certification is not required) as required therein;
21

(ii)

in the case of Definitive Notes without Coupons attached thereto at the time of their initialdelivery, against presentation of the relevant Definitive Notes at the specified office of any of
the Paying Agents outside the United States; and(iii) in the case of Definitive Notes delivered with Coupons attached thereto, against surrender ofthe relevant Coupons at the specified office of any of the Paying Agents outside the UnitedStates.
Payments of interest in US dollars in respect of Bearer Notes may only be made at the specified
offices of Paying Agents outside the United States of America, except that such payments may be madeat the specified office of a Paying Agent in New York City if (i) the Bank shall have appointed Paying
Agents with specified offices outside the United States of America with the reasonable expectation thatsuch Paying Agents would be able to make payment at such offices of the full amount of the interest on
the Notes in US dollars when due, (ii) payment of the full amount of such interest at all specified offices of
the Paying Agents outside the United States of America is illegal or effectively precluded by exchange
controls or other similar restrictions, and (iii) the relevant payment is permitted by applicable US law.
No payment of principal of or any premium, interest or other amounts on Bearer Notes shall bemade by cheque mailed to any address in the United States or by transfer to an account maintained by a
Noteholder with a bank located in the United States, except as may be permitted by U.S. federal tax law
in effect at the time of such payment without the imposition of a reporting requirement, backup
withholding or other detriment to the Bank.
No Paying Agent in the United Kingdom shall, unless and until the Bank notifies the Noteholders to
the contrary in accordance with Condition 11 below, make any payment of interest against presentationof Coupons.
The initial Paying Agents (including the Issuing and Paying Agent) and their specified offices arelisted below. The Bank may at any time vary or terminate the appointment of the Issuing and Paying
Agent or any Paying Agent and appoint another Issuing and Paying Agent or additional or other Paying
Agents, provided that it will at all times maintain a Paying Agent and a Transfer Agent, each having a
specified office in Luxembourg, so long as the Notes are listed on the regulated market of the
Luxembourg Stock Exchange. Notice of any such termination or appointment and of any changes in thespecified offices of the Issuing and Paying Agent or any Paying Agent will be given in accordance with
Condition 11 below.
Bearer Notes should be presented for redemption together with all unmatured Coupons relating
thereto, failing which either the face value of the missing unmatured Coupons (or in the case of a partial
payment of principal that proportion of the aggregate amount of the missing unmatured Coupons that the
principal paid bears to the principal due) will be deducted from the sum due for payment or, if the facevalue of the missing unmatured Coupons cannot be determined, the missing unmatured Coupons will
become void. The amounts so deducted will be paid against surrender of the relevant Coupons within five
years from the due date of such Coupons.
If any date for the payment of any amount due (whether in respect of principal, interest orotherwise) in respect of any Bearer Notes is not a Business Day, the holder shall not be entitled to
payment until the next following Business Day nor to any interest or other sum in respect of such
postponed payment. If the due date for redemption of any Bearer Note is not a due date for payment of a
Coupon, interest accrued from the preceding due date for payment of a Coupon shall only be payableagainst surrender of the relevant Bearer Note.
Registered Notes
Payment of amounts (including any accrued interest) due on the final redemption of Registered
Notes will be made against presentation and, save in the case of a partial redemption by reason of
insufficiency of funds, surrender of the relevant Registered Notes at the specified office of the Registrar
or the Transfer Agent. If the due date for payment of the final redemption amount of Registered Notes is
not a Business Day, the Holder thereof will not be entitled to payment thereof until the next following
such Business Day and no further payment shall be due in respect of such delay save in the event that
there is a subsequent failure to pay in accordance with these Terms and Conditions.
Payment of amounts (whether principal, interest or otherwise) due in respect of Registered Notes
will be paid to the Holders thereof (or, in the case of joint Holders, the first-named) as appearing in theregister kept by the Registrar as at opening of business (local time) on the fifteenth Relevant Banking
22Day before the due date for such payment (the ‘‘Record Date’’) provided that amounts due in respect ofRegistered Notes will be paid to the Holders thereof (or, in the case of joint Holders, the first-named) as
appearing in such register as at opening of business (local time) on the date on which such payment ismade.
Payments of interest in respect of Registered Notes will be made by a cheque drawn on a bank in
the Relevant Financial Centre or, in the case of a payment in euro, on a bank in the principal financial
centre of a member state of the European Community and posted to the address (as recorded in theregister held by the Registrar) of the Holder thereof (or, in the case of joint-Holders, the first-named) on
the Business Day immediately preceding the relevant date for payment unless at least four Business Daysprior to such date the Holder thereof (or, in the case of joint Holders, the first named) has applied to theRegistrar for payment to be made to a designated account (in the case aforesaid, a non-resident accountwith an authorised foreign exchange bank).
7.

Prescription
Notes will become void unless surrendered for payment within a period of ten years and Coupons
will become void unless surrendered for payment within a period of five years, in each case from the due
date for payment.
8.

Repayment in the Event of Default
Any Noteholders may deliver or cause to be delivered to the Bank at its office in Tunis Belvedere,
Tunisia (with a copy to the principal office in Abidjan, Côte d’Ivoire), written notice that such holder
elects to declare the principal of all Notes held by him to be due and payable in the event that:(a)the Bank fails to pay the principal of or interest on any of the Notes and such failure continues
for a period of 90 days after the same shall have become due and payable; or(b)

the Bank fails to perform its obligations under Condition 3 for a continuous period of ninety
days; or(c)any other bond, note or loan of a maturity of more than one year issued, assumed or
guaranteed by the Bank either (i) is declared due and payable prior to the due date forpayment thereof by reason of default by the Bank or (ii) is not repaid at maturity as extended
by the period of grace, if any, applicable thereto and such default continues for 90 days,

and on the thirtieth day after such notice shall be so delivered to the Bank the principal of such Notes andthe accrued interest thereon shall become due and payable, unless prior to that time all the defaults inrelation to such Notes shall have been cured.
9.

Replacement of Notes and Coupons
If any Note or Coupon is mutilated, defaced, lost, stolen or destroyed, it may be replaced at the
specified office of the Issuing and Paying Agent on payment by the claimant of such costs as may be
incurred in connection therewith and on such terms as to evidence and indemnity as the Bank may
require. Mutilated or defaced Notes and Coupons must be surrendered before replacements will be
issued.
10.

Modification
The Bank and the Issuing and Paying Agent may agree without the consent of the Noteholders or
holders of Coupons to any modification of these Terms and Conditions or to any modification of, waiver
or authorisation of any breach or proposed breach of or on any failure to comply with, the Issuing andPaying Agency Agreement, which is not, in the reasonable opinions of the Bank and the Issuing andPaying Agent, materially prejudicial to the interests of the Noteholders.
11.

Notices
Any notice to holders of Bearer Notes required to be given by these Terms and Conditions or theIssuing and Paying Agency Agreement shall be given by publication in (i) a leading daily newspaper in
London (which is expected to be the Financial Times) and (ii) so long as the Notes are listed on theregulated market of the Luxembourg Stock Exchange and the rules of that exchange so require, (1) in aleading daily newspaper in Luxembourg (which is expected to be the Luxemburger Wort) or (2) on theinternet website of the Luxembourg Stock Exchange (www.bourse.lu). Such notice shall be deemed tohave been given on the date of such publication or, if published more than once, or on different dates, on
the first date on which publication shall have been so made.
23

Unless otherwise specified in the relevant Pricing Supplement, notices to Holders of Registered
Notes will be deemed to be validly given by publication (1) in a leading daily newspaper in Luxembourg(which is expected to be the Luxemburger Wort) or (2) on the internet website of the Luxembourg Stock
Exchange (www.bourse.lu). Such notice shall be deemed to have been given on the date of such
publication or, if published more than once, or on different dates, on the first date on which publication
shall have been so made. Notices may also be sent by first class mail to Holders of Registered Notes (or,in the case of joint Holders, to the first-named in the register kept by the Registrar) at their respective
addresses as recorded in the register kept by the Registrar, and will be deemed to have been validly givenon the fourth Business Day after the date of such mailing.
All notices to the Bank or the Issuing and Paying Agent hereunder shall be deemed to have been
given when received in writing by the relevant party at the following address, or such other address as
shall be published in accordance with the above paragraph: the Bank, African Development Bank,
15 Avenue de Ghana, B.P. 323, 1002 Tunis Belvedere, Tunisia (Attention: Vice President for Finance)(with a copy to African Development Bank, 01 B.P. 1387, Abidjan 01, Côte d’Ivoire (Attention: Vice
President for Finance)); and the Issuing and Paying Agent, Citibank, N.A. of 5 Carmelite Street, London
EC4Y 0PA, Telex: 940500 CITIUK G, Fax: +44 207 508 3876/7/8/9 (Attention: Global Agency and Trust
Services).
12.

Further Issues
The Bank may from time to time, without the consent of the Noteholders or Couponholders, issue
further notes, having terms and conditions the same as those of the Notes, or the same except for theamount of the first payment of interest, which may be consolidated and form a single Series with theNotes.
13.

Governing Law and Jurisdiction
The Notes, the Coupons, the Issuing and Paying Agency Agreement and any non-contractual
obligations arising out of or in connection with the Notes, the Coupons and the Issuing and Paying
Agency Agreement are governed by and will be construed in accordance with the laws of England, except
as otherwise specified in the relevant Pricing Supplement.
Except as otherwise specified in the relevant Pricing Supplement, in relation to any legal action orproceedings arising out of or in connection with the Notes, the Coupons or the Issuing and Paying Agency
Agreement, including any non-contractual obligations arising out of or in connection with the Notes, theCoupons and the Issuing and Paying Agency Agreement, (‘‘Proceedings’’), the Bank hereby irrevocably
submits to the jurisdiction of the competent courts of England and waives any objection to Proceedings insuch courts whether on the grounds that the Proceedings have been brought in an inconvenient forum orotherwise. This submission is made for the benefit of each of the Noteholders and the Couponholders andshall not affect the right of any of them to bring Proceedings in any other court of competent jurisdiction
nor shall the bringing of any Proceedings in one or more jurisdictions preclude the bringing of any
Proceedings in any other jurisdiction (whether concurrently or not).
Except as otherwise specified in the relevant Pricing Supplement, the Bank irrevocably appoints
Law Debenture Corporate Services Limited situated at Fifth Floor, 100 Wood Street, London
EC2V 7EX, United Kingdom (or such other person or persons, with an address in London, as may beapproved by the Issuing and Paying Agent from time to time) as its agent to receive service of process on
its behalf in any Proceedings which may be instituted in England. The Bank will procure that, so long as
any of the Notes remains outstanding, there shall be in force an appointment of such person approved inwriting by the Issuing and Paying Agent with an office in London with authority to accept service as
aforesaid. Nothing herein shall affect the right to serve process in any other manner permitted by law. If
at any time the appointment of the agent aforesaid shall cease for any reason, the Bank shall forthwith
appoint another person in London to be its agent as aforesaid and, failing such appointment within thirtydays after demand by the Issuing and Paying Agent, the Issuing and Paying Agent shall be entitled bynotice to the Bank to appoint a person in London to act as such agent.
14.

Contracts (Rights of Third Parties) Act 1999
No person shall have any right to enforce any term or condition of the Notes under the Contracts(Rights of Third Parties) Act 1999.

24

SUMMARY OF PROVISIONS RELATING TO THE NOTES WHILE IN GLOBAL FORM
Each Series of Notes in bearer form will initially be represented by a Temporary Global Note inbearer form without Coupons which will:(i)

if the Global Notes are intended to be issued in new global note (‘‘NGN’’) form, as stated in
the applicable Final Terms, be delivered on or prior to the original issue date of the Notes to acommon safekeeper (the ‘‘Common Safekeeper’’) for Euroclear and Clearstream,
Luxembourg; and(ii)

if the Global Notes are not intended to be issued in NGN form, be delivered to a common
depositary (the ‘‘Common Depositary’’) for Euroclear and for Clearstream, Luxembourg onor prior to the original issue date of the relevant Notes. No interest will be payable in respectof a Temporary Global Note except as provided below. Upon deposit of the Temporary
Global Note with the Common Depositary, Euroclear or Clearstream, Luxembourg will credit
each subscriber with a principal amount of Notes equal to the principal amount thereof forwhich it has subscribed and paid.

Each of the persons shown in the records of Euroclear and/or Clearstream, Luxembourg as theholder of a Note represented by a Global Note must look solely to Euroclear and/or Clearstream,
Luxembourg (as the case may be) for his share of each payment made by the Bank to the bearer of such
Global Note and in relation to all other rights arising under the Global Notes, subject to and inaccordance with the respective rules and procedures of Euroclear and Clearstream, Luxembourg. Suchpersons shall have no claim directly against the Bank in respect of payments due on the Notes for so longas the Notes are represented by such Global Note and such obligations of the Bank will be discharged by
payment to the bearer of such Global Note in respect of each amount so paid.
The Temporary Global Notes and the Permanent Global Notes (referred to below) containprovisions which apply to the Notes while they are in global form, some of which modify the effect of theTerms and Conditions of the Notes set out in this document. The following is a summary of certain of
those provisions:Exchange
Each Temporary Global Note will be exchangeable in whole or in part for interests in a Permanent
Global Note or, if so stated in the relevant Pricing Supplement, for Definitive Notes after the date falling
40 days after the closing date of the Series represented by such Temporary Global Note upon certification
as to non-US beneficial ownership. Each Permanent Global Note is exchangeable in accordance with its
terms in whole but not in part only for Definitive Notes by such holder depositing the relevant Permanent
Global Note with the Issuing and Paying Agent with the form of exchange notice endorsed thereon duly
completed.
In exchange for any Permanent Global Note, the Bank will deliver or procure the delivery (free ofcharge to the holder) of, an equal aggregate principal amount of duly executed and authenticatedDefinitive Notes (if appropriate, having attached to them all Coupons in respect of interest which havenot already been paid on the Permanent Global Note), security printed in accordance with any applicablelegal and stock exchange requirements and in or substantially in the form scheduled to the Issuing andPaying Agency Agreement within 30 days of the holder requesting such exchange. On exchange of each
Permanent Global Note, the Bank will, if the holder so requests, procure that it is cancelled and returnedto the holder together with the relevant Definitive Notes.
In the event that a Global Note is exchanged for Definitive Notes, such Definitive Notes shall be
issued in Specified Denomination(s) only. A Noteholder who holds a principal amount of less than theminimum Specified Denomination will not receive a Definitive Note in respect of such holding and would
need to purchase a principal amount of Notes such that it holds an amount equal to one or more Specified
Denominations.
Payments
No payment falling due more than 40 days after the closing date of any Series represented by aTemporary Global Note will be made on that Temporary Global Note unless exchange for an interest in a
Permanent Global Note or a Definitive Note is improperly withheld or refused. Payments on any
Temporary Global Note during the period of 40 days after the closing date of such Series will only bemade against presentation of certification as to non-US beneficial ownership. All payments in respect of25

Notes represented by a Global Note will be made, if the Global Note is not intended to be issued in NGN
form, against presentation for endorsement and, if no further payment falls due to be made in respect of
the Notes, surrender of that Global Note to or to the order of the Issuing and Paying Agent or such other
Paying Agent as shall have been notified to the Noteholders for such purpose. A record of each payment
so made will be endorsed in the appropriate schedule to each Global Note, which endorsement will be
prima facie evidence that such payment has been made in respect of the Notes.
Purchase and Cancellation
Cancellation of any Note surrendered for cancellation following its purchase will be effected by
reduction in the principal amount of the relevant Global Note.
Notices
So long as any Notes are represented by a Global Note and such a Global Note is held on behalf of aclearing system, notices to the holders of Notes of that Series may be given by delivery of the relevant
notice to that clearing system for communication by it to entitled accountholders in substitution for
publication as required by the Terms and Conditions or by delivery of the relevant notice to the holder of
the Global Note.

26

USE OF PROCEEDSThe net proceeds of the issue of each Series of Notes will be incorporated in the ordinary capital
resources of the Bank and used in its ordinary operations.

27

RISK FACTORSThe following section does not describe all of the risks and investment considerations (including
those relating to each prospective investor’s particular circumstances) with respect to an investment in
Notes. Prospective investors should refer to the relevant pricing supplement for each particular issue ofNotes, which may describe additional risks and investment considerations associated with such Notes. In
addition, prospective investors should consult their own financial and legal advisors as to the risks andinvestment considerations arising from an investment in an issue of Notes, the appropriate resources toanalyse such investment (in particular, to evaluate the sensitivity of such investment to changes in
economic conditions, interest rate, exchange rate or other indices, and other factors which may have abearing on the merits and risks of an investment), and the suitability of such investment in such investor’s
particular circumstances. Words and expressions defined or used in ‘‘Terms and Conditions of the Notes’’shall have the same meaning in this section.
Interest Rate Risks
An investment in Notes the principal or premium of which is determined by reference to one ormore interest rate indices, either directly or inversely, may entail significant risks not associated withsimilar investments in a conventional debt security, including the risk that the resulting interest rate willbe less than that payable on a conventional debt security issued by the Bank at the same time and that theinvestor could lose all or a substantial portion of the principal of its Note or that no premium may bepayable thereon. The secondary market for such Notes will be affected by a number of factors
independent of the creditworthiness of the Bank and the value of the applicable interest rate index orindices, including the volatility of such interest rate index or indices, the method of calculating the index,
principal or premium, the time remaining to the maturity of the Notes, the outstanding nominal amountof the Notes and market interest rates. The value of any applicable interest rate indices should not betaken as an indication of the future performance of such interest rate indices during the term of any Note.
Structure Risks
An investment in a Structured Note (as defined below) issued by the Bank entails risks (which may
be significant) not associated with an investment in a conventional debt security issued by the Bank.
A ‘‘Structured Note’’ is a Note with principal or interest determined by reference to one or more interest
rate indices or currency or currency units (including exchange rates and swap indices between currencies
or currency units), or one or more debt or equity indices or formulae (each an ‘‘Applicable Index’’)(other than a single conventional interest rate index or formula, such as LIBOR) or features such asembedded options, caps or floors. Such risks may include, without limitation, the possibility that an
Applicable Index may be subject to significant changes, that changes in an Applicable Index may notcorrelate with changes in interest rates or exchange rates generally or with changes in other indices, thattwo or more indices or formulae that may be expected to move in tandem or in any other relation to eachother may unexpectedly converge or diverge or otherwise not move as expected, that the resulting
interest rate may be less than that payable on a conventional debt security issued by the Bank at the sametime or that no interest may be payable, that the repayment of principal may occur at times other thanthose expected by the investor, that the investor may lose all or a substantial portion of the principal
amount of its Note (whether payable at maturity, upon redemption or otherwise), that Structured Notes
may have more volatile performance results, and that the effects of currency devaluations and (asdiscussed in greater detail under ‘‘Risk Factors – Exchange Rate Risks and Exchange Controls’’) the
imposition or modification of exchange or other capital controls by authorities with jurisdiction over a
relevant currency may be greater for Structured Notes than for conventional debt securities issued by the
Bank. Such risks generally depend on a number of factors, including financial, economic and politicalevents over which the Bank has no control. In addition, if an Applicable Index used to determine theamount of interest payable contains a spread multiplier or if the Applicable Index used to determine theprincipal or interest payable is subject to some other leverage factor, the effect of any change in such
Applicable Index on the principal or interest may be magnified. If an Applicable Index includes, or issubject to, a maximum (‘‘cap’’) or minimum (‘‘floor’’) interest rate limitation, the interest or principal
payable on such Structured Note may be less than that payable on a conventional debt security issued by
the Bank at the same time. Two issues of Structured Notes issued at the same time and with interest rates
determined by reference to the same Applicable Index and otherwise comparable terms may havedifferent interest rates and yields when issued and thereafter if the frequency of interest rate adjustments
for each issue is different. In recent years, certain interest rates, currencies, currency units, exchange
rates, equity indices and other indices have been highly volatile and such volatility may continue in the28

future. Fluctuations in any particular interest rate, currency, currency unit, exchange rate, equity index orother index that have occurred in the past are not necessarily indicative, however, of fluctuations that may
occur in the future.
The timing of changes in the level of an Applicable Index may affect the actual yield to an investor,
even if the average level is consistent with the investor’s expectation. In general, the earlier a change inthe level of an Applicable Index occurs, the greater the effect on an investor’s yield. This is especially thecase with Structured Notes providing for repayment of principal at one or more times prior to maturity.
As a result, the effect on an investor’s yield of an Applicable Index level that is lower (or higher) during
earlier periods than the rate anticipated by the investor may not be offset by a later equivalent increase(or reduction).
Any optional redemption feature of Notes is likely to affect the market value of such Notes. During
any period in which such Notes are subject to redemption at the option of the Bank, their market value
generally will not rise substantially above the redemption price because of the increased likelihood ofredemption by the Bank, and this also may be true prior to any such period. The Bank may be expected
to redeem such Notes in circumstances where the Bank’s cost of borrowing is lower than the interest rateon such Notes. At such times, an investor generally would not be able to reinvest redemption proceeds at
an effective interest rate which is as high as the interest rate on such Notes, and such reinvestment might
only be at a significantly lower rate. Investors should consider the related reinvestment risk in light ofother investments that may be available to such investors. A partial redemption of an issue of Notes also
may adversely affect liquidity for the remaining outstanding Notes of such issue.
Investors in Structured Notes should have knowledge of and access to appropriate analyticalresources to analyse quantitatively the effect (or value) of any redemption, cap or floor, or certain otherfeatures of such Structured Notes, and the resulting impact upon the value of such Structured Notes.
Market, Liquidity and Yield Considerations
Notes may not have an established trading market when issued. There can be no assurance of asecondary market for any Notes or the liquidity of such market if one develops. Consequently, investors
may not be able to sell their Notes readily or at prices that will enable them to realise a yield comparable
to that of similar instruments, if any, with a developed secondary market. This is particularly the case for
Structured Notes that are especially sensitive to interest rate, currency or market risks, that are designed
for specific investment objectives or strategies or that have been structured to meet the investment
requirements of limited categories of investors, which may have a more limited secondary market and lessor no liquidity and may experience more price volatility than conventional debt securities. Liquidity may
have a severely adverse effect on the market value of Structured Notes.
Depending upon the type of Notes, market conditions and other factors, investors seeking to sellrelatively small or relatively large amounts of Notes may not be able to do so at prices comparable tothose that may be available to other investors.
The secondary market for an issue of Notes will also be affected by a number of other factors
independent of the creditworthiness of the Bank and, in the case of Structured Notes, the value of any
Applicable Index. These factors may include the complexity and volatility of such Applicable Index, themethod of calculating the principal or any interest to be paid in respect of such Notes, the time remaining
to the maturity of such Notes, the outstanding amount of such Notes, any amortisation or optional
redemption features of such Notes, the amount of other securities linked to such Applicable Index, theamount of such Notes being sold in the secondary market from time to time, any legal restrictions limiting
demand for such Notes, the availability of comparable securities, and the level, direction and volatility ofmarket interest rates generally. Such factors also will affect the market value of the Notes.
No investor should purchase Notes unless such investor understands and is able to bear the risk thatcertain Notes may not be readily saleable, that the value of Notes will fluctuate over time, and that such
fluctuations may be significant and could result in significant losses to such investor. This is particularly
the case for investors whose circumstances may not permit them to hold the Notes until maturity and/or
investors who are required to use the mark to market valuation of their holding of the Notes foraccounting purposes.
Exchange Rate Risks and Exchange Controls
As described in this Information Memorandum, Notes may be denominated or payable in one of anumber of currencies. For investors whose financial activities are denominated principally in a currency29

(the ‘‘Investor’s Currency’’) other than the Specified Currency or where principal or interest on Notes ispayable by reference to a Specified Currency index other than an index relating to the Investor’s
Currency, an investment in the Notes entails significant risks that are not associated with a similar
investment in a security denominated in that Investor’s Currency. Such risks include, without limitation,
the possibility of significant changes in the rate of exchange between the Specified Currency and theInvestor’s Currency and the possibility of the imposition or modification of exchange controls by thecountry of the Specified Currency or the Investor’s Currency. Such risks generally depend on economic
and political events over which the Bank has no control. In recent years, rates of exchange have beenhighly volatile and such volatility may be expected to continue in the future. Fluctuations in any
particular exchange rate that have occurred in the past are not necessarily indicative, however, offluctuations that may occur in the future. Depreciation of the Specified Currency against the Investor’s
Currency would result in a decrease in the Investor’s Currency equivalent yield on a Note denominated inthat Specified Currency, in the Investor’s Currency equivalent value of the principal payable at maturityof such Note and generally in the Investor’s Currency equivalent market value of such Note. An
appreciation of the Specified Currency against the Investor’s Currency would have the opposite effect.
In addition, depending on the specific terms of a Note denominated in, or the payment of which is related
to the value of, one or more foreign currencies, changes in exchange rates relating to any of the currencies
involved may result in a decrease in such Note’s effective yield and, in certain circumstances, could resultin a loss of all or a substantial portion of the principal of a Note to the investor. Further information as tocurrent and historical exchange rates between the U.S. dollar and the Specified Currency or, if the Bank
thinks it appropriate, the Investor’s Currency and the Specified Currency may be contained in theapplicable Pricing Supplement.
Governments have imposed from time to time, and may in the future impose or modify, exchange
controls which could affect exchange rates as well as the availability of a specified foreign currency at thetime of payment of principal of, premium, if any, or interest on a Note. Even if there are no actual
exchange controls, it is possible that the Specified Currency for any particular Note may not be available
when payments on such Note are due.
Legal Investment Considerations
Investors should consult their own legal advisors in determining whether and to what extent Notes
constitute legal investments for such investors and whether and to what extent Notes can be used ascollateral for various types of borrowings. In addition, financial institutions should consult their legal
advisors or regulators in determining the appropriate treatment of Notes under any applicable risk-based
capital or similar rules.
Investors whose investment activities are subject to investment laws and regulations or to review or
regulation by certain authorities may be subject to restrictions on investments in certain types of debt
securities, which may include Notes. Investors should review and consider such restrictions prior toinvesting in Notes.
Minimum Specified Denominations
In relation to any issue of Notes which have a denomination consisting of the minimum Specified
Denomination plus a higher integral multiple of another smaller amount, it is possible that the Notes may
be traded in amounts in excess of the minimum Specified Denomination that are not integral multiples ofthe minimum Specified Denomination. In such case a Noteholder who, as a result of such trading
amounts, holds a principal amount of less than the minimum Specified Denomination (as defined in theTerms and Conditions) will not receive a Definitive Note in respect of such holding (should Definitive
Notes be printed) and would need to purchase a principal amount of Notes such that it holds an amountequal to one or more Specified Denominations.

30

TAXATION
GENERAL
Each Series of Notes and the interest thereon will not be exempt from taxation generally. Under the
Agreement, no tax of any kind shall be levied by a member country on any obligation or security issued
by the Bank, including any dividend or interest thereon, by whomsoever held (a) which discriminates
against such obligation or security solely because it is issued by the Bank or (b) if the sole jurisdictional
basis for such taxation is the place or currency in which it is issued, made payable or paid, or the locationof any office or place of business maintained by the Bank. Also, under the Agreement, the Bank is
exempt from any obligation for the payment, withholding or collection of any tax. Accordingly, theinterest due on the Notes will be paid to the Issuing and Paying Agent without deduction in respect of any
tax.
UNITED STATES FEDERAL INCOME TAXATION
EACH TAXPAYER IS HEREBY NOTIFIED THAT: (A) ANY DISCUSSION OF UNITEDSTATES FEDERAL TAX ISSUES IN THIS INFORMATION MEMORANDUM IS NOTINTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED BY THE TAXPAYER,
FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED ON THE
TAXPAYER UNDER THE INTERNAL REVENUE CODE OF 1986; (B) ANY SUCHDISCUSSION IS WRITTEN TO SUPPORT THE PROMOTION OR MARKETING OF THE
TRANSACTION OR MATTERS ADDRESSED HEREIN; AND (C) THE TAXPAYER SHOULDSEEK ADVICE BASED ON ITS PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENTTAX ADVISER.
GeneralThe following is a general summary of the material U.S. federal income tax considerations that may
be relevant with respect to the ownership of the Notes. This summary does not address the material U.S.
federal income tax consequences of every type of Note which may be issued under the Facility, and therelevant Pricing Supplement may contain additional or modified disclosure concerning the material U.S.
federal income tax consequences relevant to such type of Notes as are issued thereunder. This summary
addresses only the U.S. federal income tax considerations of holders that acquire the Notes at their
original issuance and Issue Price (as defined below under ‘‘Original Issue Discount – General’’) and thatwill hold the Notes as capital assets.
This summary does not purport to address all U.S. federal income tax matters that may be relevant
to a particular holder of Notes (a ‘‘Noteholder’’). This summary does not address tax considerations
applicable to Noteholders that may be subject to special tax rules including, without limitation, thefollowing: (i) financial institutions; (ii) insurance companies; (iii) dealers or traders in securities orcurrencies; (iv) tax-exempt entities; (v) persons that will hold the Notes as part of a ‘‘hedging’’ or‘‘conversion’’ transaction or as a position in a ‘‘straddle’’ for U.S. federal income tax purposes; (vi)persons that own (or are deemed to own) 10 per cent. or more of the voting shares of the Bank; and (vii)
persons that have a ‘‘functional currency’’ other than the U.S. dollar. Further, this summary does notaddress alternative minimum tax consequences or the indirect effects on the holders of equity interests in
a Noteholder. Moreover, the summary deals only with Notes with a term of 30 years or less. The U.S.
federal income tax consequences of owning Notes with a longer term may be discussed in the applicable
Pricing Supplement.
This summary is based on the U.S. Internal Revenue Code of 1986 (the ‘‘Code’’), proposed,
temporary and final U.S. Treasury regulations (together, the ‘‘U.S. Treasury Regulations’’) promulgatedthereunder and judicial and administrative interpretations thereof, in each case as in effect and available
on the date of this Information Memorandum. All of the foregoing are subject to change or differinginterpretations, which could apply retroactively and could affect the tax consequences described below.
This summary assumes that the Notes issued under this program are treated as debt for U.S. federal
income tax purposes. It is possible that certain Notes issued under this program such as Index-Linked
Notes, Notes with long maturities or, in some cases, Subordinated Notes may be characterised as
instruments other than debt for U.S. federal income tax purposes. Each prospective investor should
consult its tax adviser with respect to the proper characterisation of the Notes for U.S. federal income tax
purposes. Each prospective investor should also consult its tax adviser with respect to the U.S. state, local
and foreign tax consequences of acquiring, owning or disposing of the Notes.

31

For the purposes of this summary, a ‘‘U.S. Holder’’ is a beneficial owner of Notes that is, for U.S.
federal income tax purposes: (i) a citizen or individual resident of the United States; (ii) a corporation (orother entity treated as a corporation for U.S. federal income tax purposes) created or organised in or
under the laws of the United States or any state thereof (including the District of Columbia); (iii) an
estate the income of which is subject to U.S. federal income taxation regardless of its source; or (iv) a
trust if (x) a court within the United States is able to exercise primary supervision over its administrationand one or more United States persons (as defined in the Code) have the authority to control all of thesubstantial decisions of such trust or (y) if it has made a valid election under U.S. Treasury regulations tobe treated as a domestic trust. A ‘‘Non-U.S. Holder’’ is a beneficial owner of Notes that is, for U.S.
federal income tax purposes, an individual, corporation, trust or estate that is not a U.S. Holder.
If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds a
Note, the U.S. federal income tax treatment of a partner generally will depend upon the status of thepartner and the activities of the partnership. A partner of a partnership holding a Note should consult its
tax adviser regarding the U.S. federal income tax consequences to the partner of the acquisition,
ownership and disposition of a Note by the partnership.
THE SUMMARY OF U.S. FEDERAL INCOME TAX CONSEQUENCES SET OUT BELOWIS FOR GENERAL INFORMATION ONLY. PROSPECTIVE PURCHASERS SHOULD
CONSULT THEIR TAX ADVISERS AS TO THE PARTICULAR TAX CONSEQUENCES TO
THEM OF OWNING THE NOTES, INCLUDING THE APPLICABILITY AND EFFECT OF
STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND POSSIBLE CHANGES IN TAXLAW.
Taxation of U.S. Holders
Payments of Interest
Interest paid on a Note, other than interest on a ‘‘Discount Note’’ that is not ‘‘qualified statedinterest’’ (each as defined below under ‘‘Original Issue Discount – General’’), will be taxable to a U.S.
Holder as ordinary interest income at the time it is received or accrued, depending on the U.S. Holder’smethod of accounting for U.S. federal income tax purposes.
If an interest payment is denominated in, or determined by reference to, a foreign currency, in thecase of a U.S. Holder utilising the cash method of accounting for U.S. federal income tax purposes, theamount of interest income in respect of any interest payment will be determined by translating suchpayment into U.S dollars at the spot exchange rate in effect on the date such interest payment is received,
regardless of whether the payment is in fact converted into U.S. dollars. No exchange gain or loss will be
realised with respect to the receipt of such interest payment, other than exchange gain or loss that is
attributable to the actual disposition of the foreign currency received.
In the case of (i) a U.S. Holder utilising the accrual method of accounting for U.S. federal income
tax purposes and (ii) a cash basis U.S. Holder required to accrue OID (as defined below) in respect of any
class of Discount Notes (as defined below), the amount of any interest income accrued during any accrual
period may be determined in accordance with either of two methods. Under the first accrual method, theamount of income accrued is based on the average exchange rate in effect during the interest accrual
period or, with respect to an accrual period that spans two taxable years, the part of the period within the
taxable year. Under the second accrual method, the U.S. Holder may elect to determine the amount ofincome accrued on the basis of the exchange rate in effect on the last day of the accrual period or, in thecase of an accrual period that spans two taxable years, the exchange rate in effect on the last day of thepart of the period within the taxable year. If the last day of the accrual period is within five business daysof the date the interest payment is actually received, an electing accrual basis U.S. Holder may insteadtranslate the interest payment at the exchange rate in effect on the day of actual receipt. Any election to
use the second accrual method will apply to all debt instruments held by the U.S. Holder at the beginningof the first taxable year to which the election applies or thereafter acquired by the U.S. Holder and will beirrevocable without the consent of the U.S. Internal Revenue Service (the ‘‘IRS’’).
A U.S. Holder using either of the foregoing two accrual methods will recognise ordinary income orloss with respect to accrued interest income on the date of receipt of the interest payment (including apayment attributable to accrued but unpaid interest upon the sale or retirement of a Note). The amountof ordinary income or loss will be the difference between the U.S. dollar value of the interest payment
received (determined on the date the payment is received) in respect of the accrual period and the U.S.
dollar value of interest income that has accrued during that accrual period (as determined under theaccrual method used by the U.S. Holder).
32Foreign currency received as interest on the Notes will have a tax basis equal to its U.S. dollar value
at the time the interest payment is received. Gain or loss, if any, realised by a U.S. Holder on a sale orother disposition of that foreign currency will be ordinary income or loss and will generally be income orloss from sources within the United States for foreign tax credit limitation purposes.
Interest income on the Notes will be treated as foreign source income for U.S. federal income tax
purposes, which may be relevant in calculating a U.S. Holder’s foreign tax credit limitation for U.S.
federal income tax purposes. The limitation on foreign taxes eligible for the U.S. foreign tax credit iscalculated separately with respect to specific classes of income. Prospective purchasers should consult
their tax advisers as to the availability of and limitations on any foreign tax credit.
Original Issue DiscountGeneralA Note, other than a Note with a term of one year or less a (‘‘Short-term Note’’), will be treated as
issued at an original issue discount (‘‘OID’’ and a Note issued with OID a ‘‘Discount Note’’) for U.S.
federal income tax purposes if the excess of the sum of all payments provided under the Note, other than‘‘qualified stated interest payments’’ (as defined below), over the ‘‘Issue Price’’ (as defined below) of theNote is more than a ‘‘de minimis amount’’ (as defined below). ‘‘Qualified stated interest’’ is generallyinterest paid on a Note that is unconditionally payable at least annually at a single fixed rate. The ‘‘Issue
Price’’ of the Notes will be the first price at which a substantial amount of the Notes are sold to persons
other than bond houses, brokers, or similar persons or organisations acting in the capacity ofunderwriters, placement agents, or wholesalers. Special rules for ‘‘Variable Rates Notes’’ are described
below under ‘‘Original Issue Discount – Variable Rate Notes’’.
In general, if the excess of the sum of all payments provided under the Note other than qualifiedstated interest payments (the Note’s ‘‘stated redemption price at maturity’’) over its Issue Price is lessthan ¼ of one per cent. of the Note’s stated redemption price at maturity multiplied by the number ofcomplete years to its maturity (the ‘‘de minimis amount’’), then such excess, if any, constitutes‘‘de minimis OID’’ and the Note is not a Discount Note. An obligation that provides for the payment ofamounts other than qualified stated interest before maturity (an ‘‘instalment obligation’’) will be treatedas a Discount Note if the excess of the Note’s stated redemption price at maturity over its issue price isequal to or greater than ¼ of one per cent. of the Note’s stated redemption price at maturity multipliedby the weighted average maturity of the Note. A Note’s weighted average maturity is the sum of thefollowing amounts determined for each payment on a Note (other than a payment of qualified statedinterest): (i) the number of complete years from the issue date until the payment is made multiplied by(ii) a fraction, the numerator of which is the amount of the payment and the denominator of which is theNote’s stated redemption price at maturity. Unless the election described below under ‘‘Election to TreatAll Interest as OID’’ is made, a U.S. Holder of a Note with de minimis OID must include such de minimis
OID in income as stated principal payments on the Note are made. The includable amount with respect
to each such payment will equal the product of the total amount of the Note’s de minimis OID and afraction, the numerator of which is the amount of the principal payment made and the denominator ofwhich is the stated principal amount of the Note.
A U.S. Holder will be required to include OID on a Discount Note in income for U.S. federal
income tax purposes as it accrues calculated on a constant-yield method (described below) generally
before the actual receipt of cash attributable to that income, regardless of the U.S. Holder’s method of
accounting for U.S. federal income tax purposes. Under this method, U.S. Holders generally will be
required to include in income increasingly greater amounts of OID over the life of Discount Notes.
The amount of OID includable in income by a U.S. Holder of a Discount Note is the sum of thedaily portions of OID with respect to the Note for each day during the taxable year or portion of thetaxable year on which the U.S. Holder holds that Note (‘‘accrued OID’’). The daily portion is determinedby allocating to each day in any ‘‘accrual period’’ a pro rata portion of the OID allocated to that accrual
period. Accrual periods with respect to a Note may be of any length selected by the U.S. Holder and mayvary in length over the term of the Note as long as (i) no accrual period is longer than one year and (ii)each scheduled payment of interest or principal on the Note occurs on either the final or first day of an
accrual period.
The amount of OID allocated to an accrual period equals the excess of (a) the product of the Note’s‘‘adjusted issue price’’ at the beginning of the accrual period and the Note’s yield to maturity (determinedon the basis of compounding at the close of each accrual period and properly adjusted for the length of
the accrual period) over (b) the sum of the payments of qualified stated interest on the Note allocated to33the accrual period. The ‘‘adjusted issue price’’ of a Note at the beginning of any accrual period is the Issue
Price of the Note increased by (x) the amount of accrued OID for each prior accrual period anddecreased by (y) the amount of any payments previously made on the Note that were not qualified statedinterest payments.
For the purposes of determining the amount of OID allocated to an accrual period, if an interval
between payments of qualified stated interest on the Note contains more than one accrual period, theamount of qualified stated interest payable at the end of the interval (including any qualified statedinterest that is payable on the first day of the accrual period immediately following the interval) is
allocated pro rata on the basis of relative lengths to each accrual period in the interval, and the adjusted
issue price at the beginning of each accrual period in the interval must be increased by the amount of any
qualified stated interest that has accrued prior to the first day of the accrual period but that is not payable
until the end of the interval.
The amount of OID allocated to an initial short accrual period may be computed using any
reasonable method if all other accrual periods other than a final short accrual period are of equal length.
The amount of OID allocable to the final accrual period is the difference between (x) the amount payableat the maturity of the Note (other than any payment of qualified stated interest) and (y) the Note’s
adjusted issue price as of the beginning of the final accrual period.
OID for any accrual period on a Note (other than a Note that is subject to the CPDI Regulations, as
described below) that is denominated in, or determined by reference to, a foreign currency will be
determined in that foreign currency and then translated into U.S. dollars in the same manner as interest
payments accrued by an accrual basis U.S. Holder, as described under ‘‘Payments of Interest’’ above.
Upon receipt of an amount attributable to OID (whether in connection with a payment on the Note or asale or disposition of the Note), a U.S. Holder may recognise U.S. source exchange gain or loss (taxable
as ordinary income or loss) equal to the difference between the amount received (translated into U.S.
dollars at the spot rate on the date of receipt) and the amount previously accrued, regardless of whether
the payment is in fact converted into U.S. dollars.
OID on a Discount Note will be treated as foreign source income for the purposes of calculating a
U.S. Holder’s foreign tax credit limitation. The limitation on foreign taxes eligible for the U.S. foreign tax
credit is calculated separately with respect to specific classes of income. Prospective purchasers should
consult their tax advisers as to the availability of and limitations on any foreign tax credit.
Fungible Issue. The Issuer may, without the consent of the Holders of outstanding Notes, issue
additional Notes with identical terms. These additional Notes, even if they are treated for non-tax
purposes as part of the same series as the original Notes, in some cases may be treated as a separate series
for U.S. federal income tax purposes. In such a case, the additional Notes may be considered to have been
issued with OID even if the original Notes had no OID, or the additional Notes may have a greater
amount of OID than the original Notes. These differences may affect the market value of the original
Notes if the additional Notes are not otherwise distinguishable from the original Notes.
Variable Rate Notes. Under the U.S. Treasury regulations dealing with OID, Floating Rate Notes
and Indexed-Linked Notes (‘‘Variable Rate Notes’’) are subject to special rules whereby a Variable Rate
Note will qualify as a ‘‘variable rate debt instrument’’ if (a) the Issue Price of the Note does not exceed
the total non-contingent principal payments by more than the lesser of (i) the product of (x) the total noncontingent principal payments, (y) the number of complete years to maturity from the issue date (or, inthe case of an instalment obligation, the weighted average maturity) and (z) 0.015, or (ii) 15 per cent. of
the total non-contingent principal payments; (b) the Note provides for stated interest compounded or
paid at least annually at (i) one or more ‘‘qualified floating rates’’, (ii) a single fixed rate and one or morequalified floating rates, (iii) a single ‘‘objective rate’’ or (iv) a single fixed rate and a single objective ratethat is a ‘‘qualified inverse floating rate’’; and (c) the Note does not provide for any principal paymentsthat are contingent (other than as described in (a) above).
A qualified floating rate or objective rate in effect at any time during the term of the instrument
must be set at a ‘‘current value’’ of that rate. A ‘‘current value’’ of a rate is the value of the rate on any
day that is no earlier than three months prior to the first day on which that value is in effect and no later
than one year following that first day.
A variable rate is a ‘‘qualified floating rate’’ if (i) variations in the value of the rate can reasonably
be expected to measure contemporaneous variations in the cost of newly borrowed funds in the currency
in which the Note is denominated or (ii) it is equal to the product of such a rate and either (a) a fixed
multiple that is greater than 0.65 but not more than 1.35, or (b) a fixed multiple greater than 0.65 but not34

more than 1.35, increased or decreased by a fixed rate. If a Note provides for two or more qualified
floating rates that (i) are within 0.25 percentage points of each other on the issue date or (ii) can
reasonably be expected to have approximately the same values throughout the term of the Note, thequalified floating rates together constitute a single qualified floating rate. A rate is not a qualified floating
rate, however, if the rate is subject to certain restrictions (including caps, floors, governors, or othersimilar restrictions) unless such restrictions are fixed throughout the term of the Note or are notreasonably expected to significantly affect the yield on the Note.
An ‘‘objective rate’’ is a rate, other than a qualified floating rate, that is determined using a single
fixed formula and that is based on objective financial or economic information that is not within thecontrol of or unique to the circumstances of the Bank or a related party (such as dividends, profits or thevalue of the Bank’s stock). A variable rate will not fail to be an objective rate merely because it is basedon the credit quality of the Issuer. A variable rate is not an objective rate, however, if it is reasonably
expected that the average value of the rate during the first half of the Note’s term will be either
significantly less than or significantly greater than the average value of the rate during the final half of theNote’s term. An objective rate is a ‘‘qualified inverse floating rate’’ if (i) the rate is equal to a fixed rateminus a qualified floating rate, and (ii) the variations in the rate can reasonably be expected to inversely
reflect contemporaneous variations in the qualified floating rate.
If interest on a Note is stated at a fixed rate for an initial period of one year or less followed byeither a qualified floating rate or an objective rate for a subsequent period and (i) the fixed rate and thequalified floating rate or objective rate have values on the issue date of the Note that do not differ bymore than 0.25 percentage points or (ii) the value of the qualified floating rate or objective rate isintended to approximate the fixed rate, the fixed rate and the qualified floating rate or the objective rate
constitute a single qualified floating rate or objective rate.
In general, if a Variable Rate Note provides for stated interest at a single qualified floating rate or
objective rate, all stated interest on the Note which is unconditionally payable in cash or property (otherthan debt instruments of the Bank) at least annually will constitute qualified stated interest and will betaxed accordingly. The amount of OID, if any, is determined under the rules applicable to fixed rate debt
instruments by using, in the case of (i) a qualified floating rate or qualified inverse floating rate, the value,
as of the issue date, of the qualified floating rate or qualified inverse floating rate, or, (ii) in the case of any
other objective rate, a fixed rate that reflects the yield reasonably expected for the Note.
If a Variable Rate Note does not provide for stated interest at a single qualified floating rate or asingle objective rate and also does not provide for interest payable at a fixed rate (other than at a single
fixed rate for an initial period), the amount of interest and OID accruals on the Note are generally
determined by (i) determining a fixed rate substitute for each variable rate provided under the Variable
Rate Note (generally, the value of each variable rate as of the issue date or, in the case of an objective
rate that is not a qualified inverse floating rate, a rate that reflects the reasonably expected yield on theNote), (ii) constructing the equivalent fixed rate debt instrument (using the fixed rate substitutes
described above), (iii) determining the amount of qualified stated interest and OID with respect to theequivalent fixed rate debt instrument, and (iv) making the appropriate adjustments for actual variable
rates during the applicable accrual period.
If a Variable Rate Note provides for stated interest either at one or more qualified floating rates orat a qualified inverse floating rate, and in addition provides for stated interest at a single fixed rate (otherthan at a single fixed rate for an initial period), the amount of interest and OID accruals are determined
as in the immediately preceding paragraph with the modification that the Variable Rate Note is treated,
for the purposes of the first three steps of the determination, as if it provided for a qualified floating rate
(or a qualified inverse floating rate, as the case may be) rather than the fixed rate. The qualified floating
rate (or qualified inverse floating rate) replacing the fixed rate must be such that the fair market value ofthe Variable Rate Note as of the issue date would be approximately the same as the fair market value ofan otherwise identical debt instrument that provides for the qualified floating rate (or qualified inverse
floating rate) rather than the fixed rate.
Contingent Payment Note. If a Variable Rate Note does not qualify as a ‘‘variable rate debt
instrument’’ or if any Note provides for one or more contingencies and is not otherwise exempt from thecontingent payment debt instrument rules, then the Variable Rate Note or any such Note would betreated as a contingent payment debt instrument under the OID Treasury Regulations.
In general, the U.S. Treasury regulations dealing with contingent payment debt instruments(‘‘CPDI Regulations’’) would cause the timing and character of income, gain or loss reported on a35

contingent payment debt instrument to substantially differ from the timing and character of income, gainor loss reported under general principles of current U.S. federal income tax law. The CPDI Regulations
generally require a U.S. Holder of such an instrument to include future contingent and non-contingent
interest payments in income as such interest accrues based upon a projected payment schedule.
Moreover, in general, under the CPDI Regulations, any gain recognised by a U.S. Holder on the sale,exchange, or retirement of a contingent payment debt instrument will be treated as ordinary income andall or a portion of any loss realised could be treated as ordinary loss as opposed to capital loss (depending
upon the circumstances).
Under the non-contingent bond method, for each accrual period prior to and including the maturity
date of the Note, the amount of interest that accrues, as OID, equals the product of (i) the adjusted issue
price and (ii) the ‘‘comparable yield’’ (adjusted for the length of the accrual period). This amount isratably allocated to each day in the accrual period and is includable as ordinary interest income by a U.S.
Holder for each day in the accrual period on which the U.S. Holder holds the Note. The adjusted issue
price for purposes of the non-contingent bond method is equal to the Note’s Issue Price, increased by theinterest previously accrued on the Note and decreased by the amount of any Projected Payments (asdefined below) previously accrued on the Note. The ‘‘comparable yield’’ is the annual yield that the Bank
would pay, as of the issue date, on a fixed rate debt instrument with no contingent payment but with terms
and conditions otherwise comparable to those of the Note. Amounts treated as interest under theforegoing contingent payment obligation rules are treated as OID for all U.S. federal income tax
purposes.
Under the non-contingent bond method, the Bank would be required, solely for U.S. federal income
tax purposes, to provide a schedule (the ‘‘Schedule’’) of the projected amounts of payments (the‘‘Projected Payments’’) on the Note. The Schedule must include each non-contingent payment and an
estimated amount for each contingent payment, and must produce the comparable yield. The comparable
yield and Schedule will be available from the Bank by submitting a written request for such information
to Vice President, Finance, 15 Avenue de Ghana, B.P. 323, 1002 Tunis Belvedere, Tunisia, Telephone:+216 71 102 803, Fax: +216 71 330 598 and E-mail: mtn-desk@afdb.org and back-office@afdb.org.
THE COMPARABLE YIELD AND SCHEDULE WILL NOT BE DETERMINED FOR ANY
PURPOSE OTHER THAN FOR THE DETERMINATION OF INTEREST ACCRUALS AND
ADJUSTMENTS THEREOF IN RESPECT OF CONTINGENT NOTES FOR U.S. FEDERALINCOME TAX PURPOSES AND WILL NOT CONSTITUTE A PROJECTION OR
REPRESENTATION REGARDING THE ACTUAL AMOUNTS PAYABLE TO THE
HOLDERS OF THE NOTES.
The use of the comparable yield and the calculation of the Projected Payments will be based upon anumber of assumptions and estimates and will not be a prediction, representation or guarantee of theactual amounts of interest that may be paid to a U.S. Holder or the actual yield of the Notes. A
U.S. Holder will generally be bound by the comparable yield and the Schedule determined by the Bank,
unless the U.S. Holder determines its own comparable yield and projected payment schedule andexplicitly discloses such schedule to the IRS, and explains to the IRS the reason for preparing its own
schedule. The Issuer’s determination, however, is not binding on the IRS, and it is possible that the IRS
could conclude that some other comparable yield or projected payment schedule should be used instead.
If during any taxable year the sum of any actual payments (including the fair market value of any
property received in that year) with respect to the Note for that taxable year (including, in the case of thetaxable year which includes the maturity date of the Note, the amount of cash received at maturity)
exceeds the total amount of Projected Payments for that taxable year, the difference will produce a ‘‘net
positive adjustment’’, which will be treated as additional interest for the taxable year. If the actual
amount received in a taxable year is less than the amount of Projected Payments for that taxable year, thedifference will produce a ‘‘net negative adjustment’’, which will (i) reduce the U.S. Holder’s interest
income for that taxable year and (ii) to the extent of any excess after application of (i), give rise to an
ordinary loss to the extent of the U.S. Holder’s interest income on the Note during the prior taxable years(reduced to the extent such interest was offset by prior net negative adjustments). Any negative
adjustment that is not allowed as an ordinary loss for the taxable year is carried forward to the next
taxable year, and is taken into account in determining whether the U.S. Holder has a net positive or
negative adjustment for that year. However, any negative adjustment that is carried forward to a taxable
year in which the Contingent Note is sold, exchanged or retired, to the extent not applied to OID accrued
for such year, reduces the U.S. Holder’s amount realised on the sale, exchange or retirement. As a resultof the classification of a Note as a contingent payment debt instrument subject to the non-contingent
36

bond method, any gain or loss realised on the sale or exchange of the Note may be treated as ordinary
income or loss, in whole or in part.
Special rules apply to determine the accrual of OID, and the amount, timing, source and characterof any gain or loss on a Note subject to the CPDI regulations that is denominated in a foreign currency (a‘‘Foreign Currency Contingent Note’’), including certain non-contingent Notes whose payments aredenominated in, or are determined by reference to, more than one foreign currency. The rules applicable
to Foreign Currency Contingent Notes are complex, and U.S. Holders are urged to consult their tax
advisers concerning the application of these rules.
Under these rules, a U.S. Holder of a Foreign Currency Contingent Note will generally be required
to accrue OID in the foreign currency in which the Foreign Currency Contingent Note is denominated(i) at a yield at which the Bank would issue a fixed rate debt instrument denominated in the same foreign
currency with terms and conditions similar to those of the Foreign Currency Contingent Note, and (ii) in
accordance with a projected payment schedule determined by the Bank, under rules similar to thosedescribed above. The amount of OID on a Foreign Currency Contingent Note that accrues in any accrual
period will be the product of the comparable yield of the Foreign Currency Contingent Note (adjusted toreflect the length of the accrual period) and the adjusted issue price of the Foreign Currency Contingent
Note. The adjusted issue price of a Foreign Currency Contingent Note will generally be determined
under the rules described above, and will be denominated in the foreign currency of the Foreign Currency
Contingent Note.
OID on a Foreign Currency Contingent Note will be translated into U.S. dollars under translation
rules similar to those described above under ‘‘Payments of Interest’’. Any positive adjustment (i.e. theexcess of actual payments over projected payments) in respect of a Foreign Currency Contingent Note
for a taxable year will be translated into U.S. dollars at the spot rate on the last day of the taxable year inwhich the adjustment is taken into account or, if earlier, the date on which the Foreign Currency
Contingent Note is disposed of. The amount of any negative adjustment on a Foreign Currency
Contingent Note (i.e. the excess of projected payments over actual payments) that is offset against
accrued but unpaid OID will be translated into U.S. dollars at the same rate as which such OID was
accrued. To the extent a net negative adjustment exceeds the amount of accrued but unpaid OID, thenegative adjustment will be treated as offsetting OID that has accrued and been paid on the Foreign
Currency Contingent Note, and will be translated into U.S. dollars at the spot rate on the date theForeign Currency Contingent Note was issued. Any net negative adjustment carry forward will be carriedforward in the relevant foreign currency.
Prospective purchasers should consult their tax advisers regarding the applicability andconsequences of the contingent payment debt instrument rules to any of the Notes issued under the
Facility.
Notes Subject to Redemption. Certain of the Notes (i) may be redeemable at the option of the Bankprior to their maturity (a ‘‘call option’’) and/or (ii) may be repayable at the option of the holder prior totheir stated maturity (a ‘‘put option’’). Solely for the purposes of determining whether such a Note has
OID, the Bank will be deemed to exercise any call option that has the effect of decreasing the yield on theNote, and the U.S. Holder will be deemed to exercise any put option that has the effect of increasing theyield on the Note. Notes containing such features may be subject to rules that are different from thegeneral rules discussed above. Investors intending to purchase Notes with such features should consult
their tax advisers, since the OID consequences of acquiring, holding, and disposing of such Notes will
depend, in part, on the particular terms and features of the purchased Notes.
Short-Term Notes. Short Term Notes (i.e., Notes that have a fixed maturity of one year or less) willbe treated as having been issued with OID. In general, an individual or other cash method U.S. Holder is
not required to accrue such OID unless the U.S. Holder elects to do so. If such an election is not made,any gain recognised by the U.S. Holder on the sale, exchange or maturity of the Short-Term Note will be
ordinary income to the extent of the OID accrued on a straight-line basis, or upon election under theconstant yield method (based on daily compounding), through the date of sale or maturity, and a portionof the deductions otherwise allowable to the U.S. Holder for interest on borrowings allocated to the
Short-Term Note will be deferred until a corresponding amount of income is realised. U.S. Holders whoreport income for U.S. federal income tax purposes under the accrual method, and certain other holders
including banks and dealers in securities, are required to accrue OID on a Short-Term Note on a straightline basis unless an election is made to accrue the OID under a constant yield method (based on daily
compounding).

37

For purposes of determining the amount of OID subject to these rules, all interest payments on a
Short-Term Note are included in the Short-Term Note’s stated redemption price at maturity. A
U.S. Holder may elect to determine OID on a Short-Term Note as if the Short-Term Note had beenoriginally issued to the U.S. Holder at the U.S. Holder’s purchase price for the Short-Term Note. This
election will apply to all obligations with a maturity of one year or less acquired by the U.S. Holder on orafter the first day of the first taxable year to which the election applies, and may not be revoked without
the consent of the IRS.
Election to Treat All Interest as OID. A U.S. Holder may elect to include in gross income all interest
that accrues on a Note using the constant-yield method described above under the heading ‘‘OriginalIssue Discount – General’’ with the modifications described below. For the purposes of this election,interest includes stated interest, OID, de minimis OID and unstated interest, as adjusted by any
amortisable bond premium (described below).
In applying the constant-yield method to a Note with respect to which this election has been made,the issue price of the Note will equal its cost to the electing U.S. Holder, the issue date of the Note will be
the date of its acquisition by the electing U.S. Holder, and no payments on the Note will be treated as
payments of qualified stated interest. This election will generally apply only to the Note with respect towhich it is made and may not be revoked without the consent of the IRS. However, if this election ismade with respect to a Note with amortisable bond premium, then the electing U.S. Holder will bedeemed to have elected to apply amortisable bond premium against interest with respect to all debt
instruments with amortisable bond premium (other than debt instruments the interest on which is
excludible from gross income) held by the electing U.S. Holder as of the beginning of the taxable year inwhich the Note with respect to which the election is made is acquired or thereafter acquired. The deemed
election with respect to amortisable bond premium may not be revoked without the consent of the IRS.
U.S. Holders should consult their tax advisers concerning the propriety and consquences of this election.
Notes Purchased at a Premium
A U.S. Holder that purchases a Note for an amount in excess of its principal amount (or, for a
Discount Note, its stated redemption price at maturity) may elect to treat such excess as ‘‘amortisablebond premium’’. If such election is made, the amount required to be included in the U.S. Holder’s income
each year with respect to interest on the Note will be reduced by the amount of amortisable bondpremium allocated (based on the Note’s yield to maturity) to such year. In the case of a Note that isdenominated in, or determined by reference to, a foreign currency, amortisable bond premium will becomputed in units of foreign currency and any such bond premium that is taken into account currently
will reduce interest income in units of foreign currency. On the date bond premium offsets interest
income, a U.S. Holder may recognise U.S. source exchange gain or loss (taxable as ordinary income orloss) equal to the amount offset multiplied by the difference between the spot rate in effect on the date of
the offset, and the spot rate in effect on the date the Notes were acquired by the U.S. Holder. Anyelection to amortise bond premium shall apply to all debt instruments (other than debt instruments theinterest in which is excludable from gross income for U.S. federal income tax purposes) held by the U.S.
Holder at the beginning of the first taxable year to which the election applies or thereafter acquired by
the U.S. Holder and is irrevocable without the consent of the IRS.
Sale, Exchange or Retirement of the Notes
Notes other than Contingent Payment Notes and Foreign Currency Contingent Notes. A U.S.
Holder’s tax basis in a Note will generally equal its ‘‘U.S. dollar cost’’, increased by the amount of any
OID included in the U.S. Holder’s income with respect to the Note and the amount, if any, of income
attributable to de minimis OID included in the U.S. Holder’s income with respect to the Note (each asdetermined above), and reduced by the amount of any payments with respect to the Note that are notqualified stated interest payments and the amount of any amortisable bond premium applied to reduce
interest on the Note. The ‘‘U.S. dollar cost’’ of a Note purchased with a foreign currency will generally be
the U.S. dollar value of the purchase price on the date of purchase or, in the case of Notes traded on an
established securities market (as defined in the applicable U.S. Treasury regulations) that are purchasedby a cash basis U.S. Holder or an accrual basis U.S. Holder that so elects, on the settlement date forthe purchase.
U.S. Holder will generally recognise gain or loss on the sale, exchange or retirement of a Note equal
to the difference between the amount realised on the sale, exchange or retirement that is not attributableto accrued but unpaid interest (which is accounted for as if it were an interest payment in the manner
described above under ‘‘Payments of Interest’’) and the tax basis of the Note. The amount realised on the38sale, exchange or retirement of a Note for an amount in foreign currency will be the U.S. dollar value ofthat amount on (1) the date of sale, retirement or disposition of the Note or (2) in the case of a Note
traded on an established securities market (as defined in the applicable U.S. Treasury regulations) that issold by a cash basis U.S. Holder (or an accrual basis U.S. Holder that so elects), on the settlement date forthe sale. Such an election by an accrual basis U.S. Holder must be applied consistently from year to year
and cannot be revoked without the consent of the IRS.
Gain or loss recognised by a U.S. Holder on the sale, exchange or retirement of a Note that is
attributable to changes in currency exchange rates will be ordinary income or loss and will consist of OID
exchange gain or loss and principal exchange gain or loss. OID exchange gain or loss will equal thedifference between the U.S. dollar value of the amount received on the sale, exchange or retirement of aNote that is attributable to accrued but unpaid OID as determined by using the exchange rate on the dateof the sale, exchange or retirement and the U.S. dollar value of accrued but unpaid OID as determined by
the U.S. Holder under the rules described above under ‘‘Original Issue Discount-General’’. Principal
exchange gain or loss will equal the difference between the U.S. dollar value of the U.S. Holder’spurchase price of the Note in foreign currency determined on the date of the sale, exchange orretirement, and the U.S. dollar value of the U.S. Holder’s purchase price of the Note in foreign currency
determined on the date the U.S. Holder acquired the Note. The foregoing foreign currency gain or loss
will be recognised only to the extent of the total gain or loss realised by the U.S. Holder on the sale,exchange or retirement of the Note and will generally be treated as from sources within the United States
for U.S. foreign tax credit limitation purposes.
Any gain or loss recognised by a U.S. Holder in excess of foreign currency gain recognised on thesale, exchange or retirement of a Note would generally be U.S. source capital gain or loss (except to theextent such amounts are attributable to accrued but unpaid interest, or subject to the general rules
governing contingent payment debt instruments).
Prospective investors should consult their tax advisors with respect to the treatment of capital gains(which may be taxed at lower rates than ordinary income for taxpayers that are individuals, trusts or
estates that held the Notes for more than one year) and capital losses (the deductability of which is
subject to significant limitations).
Contingent Notes. Gain from the sale or retirement of a Contingent Note will be treated as interest
income taxable at ordinary income (rather than capital gains) rates. Any loss will be ordinary loss to theextent that the U.S. Holder’s total interest inclusions to the date of sale or retirement exceed the total net
negative adjustments that the U.S. Holder took into account as ordinary loss, and any further loss will becapital loss. Gain or loss realised by a U.S. Holder on the sale or retirement of a Contingent Note will
generally be foreign source.
A U.S. Holder’s tax basis in a Contingent Note will generally be equal to its cost, increased by theamount of interest previously accrued with respect to the Note (determined without regard to any
positive or negative adjustments reflecting the difference between actual payments and Projected
Payments), increased or decreased by the amount of any positive or negative adjustment that the Holder
is required to make to account for the difference between the Holder’s purchase price for the Note andthe adjusted issue price of the Note at the time of the purchase, and decreased by the amount of any
Projected Payments scheduled to be made on the Note to the U.S. Holder through such date (without
regard to the actual amount paid).
Foreign Currency Contingent Notes. Upon a sale, exchange or retirement of a Foreign Currency
Contingent Note, a U.S. Holder will generally recognise taxable gain or loss equal to the difference
between the amount realised on the sale, exchange or retirement and the U.S. Holder’s tax basis in theForeign Currency Contingent Note, both translated into U.S. dollars as described below. A U.S. Holder’stax basis in a Foreign Currency Contingent Note will equal (i) the cost thereof (translated into U.S.
dollars at the spot rate on the issue date), (ii) increased by the amount of OID previously accrued on theForeign Currency Contingent Note (disregarding any positive or negative adjustments and translated into
U.S. dollars using the exchange rate applicable to such OID) and (iii) decreased by the projected amountof all prior payments in respect of the Foreign Currency Contingent Note. The U.S. dollar amount of the
projected payments described in clause (iii) of the preceding sentence is determined by (i) first allocating
the payments to the most recently accrued OID to which prior amounts have not already been allocatedand translating those amounts into U.S. dollars at the rate at which the OID was accrued and (ii) thenallocating any remaining amount to principal and translating such amount into U.S. dollars at the spot
rate on the date the Foreign Currency Contingent Note was issued. For this purpose, any accrued OID
reduced by a negative adjustment carry forward will be treated as principal.
39

The amount realised by a U.S. Holder upon the sale, exchange or retirement of a Foreign Currency
Contingent Note will equal the amount of cash and the fair market value (determined in foreign
currency) of any property received. If a U.S. Holder holds a Foreign Currency Contingent Note until its
scheduled maturity, the U.S. dollar equivalent of the amount realised will be determined by separatingsuch amount realised into principal and one or more OID components, based on the principal and OID
comprising the U.S. Holder’s basis, with the amount realised allocated first to OID (and allocated to themost recently accrued amounts first) and any remaining amounts allocated to principal. The U.S. dollar
equivalent of the amount realised upon a sale, exchange or unscheduled retirement of a Foreign Currency
Contingent Note will be determined in a similar manner but will first be allocated to principal and then
any accrued OID (and will be allocated to the earliest accrued amounts first). Each component of theamount realised will be translated into U.S. dollars using the exchange rate used with respect to thecorresponding principal or accrued OID. The amount of any gain realised upon a sale, exchange orunscheduled retirement of a Foreign Currency Contingent Note will be equal to the excess of the amountrealised over the holder’s tax basis, both expressed in foreign currency, and will be translated into U.S.
dollars using the spot rate on the payment date. Gain from the sale or retirement of a Foreign Currency
Contingent Note will generally be treated as interest income taxable at ordinary income (rather thancapital gains) rates. Any loss will be ordinary loss to the extent that the U.S. Holder’s total OID
inclusions to the date of sale or retirement exceed the total net negative adjustments that the U.S. Holder
took into account as ordinary loss, and any further loss will be capital loss. Gain or loss (other than loss
treated as capital loss) realised by a U.S. Holder on the sale or retirement of a Foreign Currency
Contingent Note will generally be foreign source. Any capital loss will generally be U.S. source.
Prospective purchasers should consult their tax advisers as to the foreign tax credit implications of thesale or retirement of Foreign Currency Contingent Notes.
A U.S. Holder will also recognise U.S. source exchange rate gain or loss (taxable as ordinary income
or loss) on the receipt of foreign currency in respect of a Foreign Currency Contingent Note if theexchange rate in effect on the date the payment is received differs from the rate applicable to theprincipal or accrued OID to which such payment relates.
Disposition of Foreign Currency
A U.S. Holder will have a tax basis in any foreign currency received on the sale, exchange orretirement of a Note equal to the U.S. dollar value of the foreign currency at the time of the sale,exchange or retirement. Gain or loss, if any, realised by a U.S. Holder on a sale or other disposition ofthat foreign currency will be ordinary income or loss and will generally be income from sources within the
United States for foreign tax credit limitation purposes.
Taxation of Non-U.S. Holders
Payments on the Notes and gain from the sale, redemption or other disposition of the Notes
generally will not be subject to U.S. federal income or withholding tax in the hands of a Non-U.S. Holder(i) unless that payment and/or gain is effectively connected with the conduct by that Non-U.S. Holder of a
trade or business within the United States or (ii) in the case of any gain realised on the sale or exchange ofa Note by an individual Non-U.S. Holder, that holder is present in the United States for 183 days or morein the taxable year of the sale, exchange or retirement and certain other conditions are met. Noteholders
that are Non-U.S. Holders should consult their tax advisers regarding the U.S. federal income and othertax consequences of owning Notes.
Taxation provisions of the Agreement
The imposition of U.S. federal income tax in the manner described above is not inconsistent with
the Agreement, which provides that no tax of any kind shall be levied by a member country on any
obligation or security issued by the Bank, including any dividend or interest thereon, by whomsoever held(a) which discriminates against such obligation or security solely because it is issued by the Bank or (b) if
the sole jurisdictional basis for such taxation is the place or currency in which it is issued, made payable orpaid, or the location of any office or place of business maintained by the Bank. Also, under the
Agreement, the Bank is not under any obligation to withhold or pay any tax on the interest on the Notes.
Backup withholding and information reporting
Backup withholding and information reporting requirements may apply to certain payments on theNotes and proceeds of the sale or redemption of the Notes that are paid to U.S. Holders and are madewithin the United States or by certain U.S. or U.S.-controlled paying agents. The Bank is not subject to40

the reporting requirements, and the backup withholding requirements do not apply to the Bank or its
paying agent. Information returns may, however, be filed with the IRS by the Bank’s paying agent withregard to certain payments on Notes made within the United States to certain U.S. Holders if such
returns are otherwise required of the paying agent. In addition, brokers, trustees, custodians and otherintermediaries may be subject to the reporting and backup withholding requirements with respect tocertain payments received by them on the Notes held for the account of certain U.S. Holders. Certain
U.S. Holders (including, among others, corporations) are not subject to the backup withholding andinformation reporting requirements. U.S. Holders who establish an exemption by providing theirtaxpayer identification number, generally on IRS Form W-9, will not be subject to backup withholding.
Non-U.S. Holders may be required to comply with applicable certification procedures to establish thatthey are not U.S. Holders in order to avoid the application of information reporting requirements andbackup withholding. Backup withholding is not an additional tax. Any amounts withheld under the
backup withholding rules from a payment to a holder generally may be claimed as a credit against suchholder’s U.S. federal income tax liability provided that the required information is furnished to the IRS.
Potential investors should consult their tax advisors regarding the applicability and consequences of
information reporting and backup withholding.
A U.S. taxpayer that participates in a ‘‘reportable transaction’’ will be required to disclose its
participation to the IRS. The scope and application of these rules is not entirely clear. A U.S. Holder may
be required to treat a foreign currency exchange loss from the Notes as a reportable transaction if the loss
exceeds U.S.$50,000 in a single taxable year, if the U.S. Holder is an individual or trust, or higher amounts
for other non-individual U.S. Holders. In the event the acquisition, holding or disposition of Notes
constitutes participation in a reportable transaction for purposes of these rules, a U.S. Holder will be
required to disclose its investment by filing Form 8886 with the IRS. A penalty in the amount of
U.S.$10,000 in the case of a natural person and U.S.$50,000 in all other cases is generally imposed on any
taxpayer that fails to timely file an information return with the IRS with respect to a transaction resulting
in a loss that is treated as a reportable transaction. Accordingly, if a U.S. Holder realises a loss on any
Note (or, possibly, aggregate losses from the Notes) satisfying the monetary thresholds discussed above,
the U.S. Holder could be required to file an information return with the IRS, and failure to do so may
subject the U.S. Holder to the penalties described above. In addition, the Issuer and its advisers may also
be required to disclose the transaction to the IRS, and to maintain a list of U.S. Holders, and to furnish
this list and certain other information to the IRS upon written request. Prospective purchasers are urged
to consult their tax advisers regarding the application of these rules to the acquisition, holding or
disposition of Notes.

41

RELATED DERIVATIVES TRANSACTIONS
In connection with the issuance of Notes, the Bank may enter into negotiated currency and/orinterest rate swaps or other financial derivative transactions. The Bank’s counterparty in any suchderivative transaction may be an institution that is also acting as Dealer with respect to the Notes, or anaffiliate of a Dealer. Payments to be made and received by the Bank under any such derivativetransaction may be calculated on the basis of the amounts payable by the Bank under the Notes and theproceeds payable to the Bank in connection with the sale of the Notes, either before or after deduction of
the commissions described in the related Pricing Supplement. The Bank’s rights and obligations under
any such derivative transaction will be wholly independent of its rights and obligations under the Notes,
and the holders of the Notes will have no interest in any such derivative transaction or any payment towhich the Bank may be entitled thereunder.

42

SUBSCRIPTION AND SALE
Notes may be issued and sold from time to time by the Bank to any one or more of Citigroup Global
Markets Limited, Australia and New Zealand Banking Group Limited, Barclays Bank PLC, BNP
Paribas, Commerzbank Aktiengesellschaft, Credit Suisse Securities (Europe) Limited, Daiwa Securities
SMBC Europe Limited, Goldman Sachs International, HSBC Bank plc, J.P. Morgan Securities Ltd.,
Merrill Lynch International, Mitsubishi UFJ Securities International plc, Mizuho International plc,
Morgan Stanley & Co. International plc, Nomura International plc, Shinkin International Ltd., SociétéGénérale, Standard Bank Plc, Standard Chartered Bank and The Toronto-Dominion Bank (the‘‘Dealers’’) or to any other person. The arrangements under which Notes may from time to time be
agreed to be issued and sold by the Bank to, and purchased by, Dealers are set out in a dealer agreement
dated 8 September 2009 (the ‘‘Dealer Agreement’’, which expression includes any further amendment or
supplements thereto or restatements thereof), and made between the Bank and the Dealers. Any suchagreement will inter alia make provision for the form and terms and conditions of the relevant Notes, theprice at which such Notes will be purchased by the Dealers and the commissions or other agreed
deductibles (if any) payable or allowable by the Bank in respect of such purchase. The Dealer Agreement
makes provision for the resignation or replacement of existing Dealers and the appointment of additionalor other Dealers.
The Bank has acknowledged that other than the listing of the Facility and/or any individual series ofNotes on the regulated market of the Luxembourg Stock Exchange or such other listing authority, stock
exchange, regulatory exchange and/or quotation system as may be agreed between the Issuer and therelevant Dealer no action has been or will be taken in any jurisdiction by the Bank that would permit apublic offering of Notes, or possession or distribution of any offering material in relation thereto, in any
country or jurisdiction where action for that purpose is required. The Bank has confirmed that it willcomply with all laws and regulations applicable to it in each country or jurisdiction in which it purchases,
offers, sells or delivers Notes or has in its possession or distributes such offering material, in all cases at its
own expense.
The Bank and the Dealers have severally confirmed that, in relation to each issue of Notes, they willcomply with all applicable laws, regulations and market or other regulatory guidelines applicable to therespective party as are in force from time to time which are relevant in the context of the issue of such
Notes, including, without limitation, any relevant maturity requirements and minimum denomination
requirements applicable to such issue, and shall submit (or procure the submission of) such reports orinformation as may from time to time be required for compliance with such laws, regulations and market
or other regulatory guidelines.
United States of America
Under the provisions of Section 9(A) of the African Development Bank Act, the Notes are
exempted securities within the meaning of Section 3(a)(2) of the Securities Act and Section 3(a)(12) of
the US Securities Exchange Act of 1934, as amended.
Bearer Notes with a maturity of more than one year are subject to US tax law requirements. Subject
to certain exceptions, Bearer Notes may not be offered, sold or delivered within the United States or to
US persons. Each Dealer has agreed that it will not offer, sell or deliver a Bearer Note within the UnitedStates or to US persons except as permitted by the Dealer Agreement.
The following legend will appear on all Global Notes in bearer form, definitive Bearer Notes andCoupons. ‘‘Any United States person who holds this obligation will be subject to limitations under theUnited States income tax laws including the limitations provided in Section 165(j) and 1287(a) of theInternal Revenue Code’’.
Each issuance of Notes may be subject to such additional US selling restrictions which, if required,
will be specified in the relevant Pricing Supplement. Each Dealer has agreed and will agree that it willoffer, sell or deliver such Notes only in compliance with such additional US selling restrictions.
United Kingdom
Each Dealer has severally represented and warranted that it has complied and will comply with allapplicable provisions of the FSMA with respect to anything done by it in relation to any Notes in, from orotherwise involving the United Kingdom.

43

JapanEach Dealer has acknowledged that the Notes have not been and will not be registered under the
Financial Instruments and Exchange Act of Japan (Law No. 25 of 1948, as amended the ‘‘FIEA’’).
Accordingly, each Dealer has represented, warranted and agreed, and each further Dealer appointed
under the Programme will be required to represent and agree, that it has not, directly or indirectly,
offered or sold and will not, directly or indirectly, offer or sell any Notes in Japan or to, or for the benefitof, any resident of Japan (as defined under Item 5, paragraph 1, Article 6 of the Foreign Exchange andForeign Trade Control Law (Law No. 228 or 1949, as amended)) or to others for re-offering or re-sale,directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan except pursuant to an
exemption from the registration requirements of, and otherwise in compliance with, the FIEA and otherrelevant laws, regulations and ministerial guidelines of Japan.
Singapore
Each Dealer has acknowledged that this Information Memorandum has not been registered as aprospectus with the Monetary Authority of Singapore under the Securities and Futures Act, Chapter 289
of Singapore (the ‘‘SFA’’). Accordingly, each Dealer has represented, warranted and agreed that it has
not offered or sold any Notes or caused the Notes to be made the subject of an invitation for subscription
or purchase and will not offer or sell any Notes or cause the Notes to be made the subject of an invitation
for subscription or purchase, and has not circulated or distributed, nor will it circulate or distribute, thisInformation Memorandum or any other document or material in connection with the offer or sale, orinvitation for subscription or purchase, of the Notes, whether directly or indirectly, to persons in
Singapore other than (i) to an institutional investor under Section 274 of the SFA, (ii) to a relevant person
pursuant to Section 275(1), or to any person pursuant to Section 275(1A), and in accordance with theconditions specified in Section 275, of the SFA or (iii) otherwise pursuant to, and in accordance with theconditions of, any other applicable provision of the SFA.
Where the Notes are subscribed or purchased under Section 275 of the SFA by a relevant person
which is:(a)a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) thesole business of which is to hold investments and the entire share capital of which is owned by
one or more individuals, each of whom is an accredited investor; or(b)a trust (where the trustee is not an accredited investor) whose sole purpose is to holdinvestments and each beneficiary of the trust is an individual who is an accredited investor,

shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights andinterest (howsoever described) in that trust shall not be transferred within six months after that
corporation or that trust has acquired the Notes pursuant to an offer made under Section 275 of the
SFA except:
1.

to an institutional investor under Section 274 of the SFA or to a relevant person defined in
Section 275(2) of the SFA, or to any person pursuant to Section 275 (1A) of the SFA, and inaccordance with the conditions specified in Section 275 of the SFA;

2.

where no consideration is or will be given for the transfer; or3.

where the transfer is by operation of law.

Australia
No prospectus or other disclosure document (as defined in the Corporations Act 2001 of theCommonwealth of Australia) in relation to the Notes has been, or will be, lodged with the Australian
Securities and Investments Commission (‘‘ASIC’’). Accordingly, each Dealer has severally agreed that it:(a)has not made or invited, and will not make or invite, an offer of the Notes for issue, sale orpurchase in the Commonwealth of Australia (including an offer or invitation which is received
by a person in the Commonwealth of Australia); and(b)

has not distributed or published, and will not distribute or publish, this Information
Memorandum or any other offering material or advertisement relating to the Notes in the
Commonwealth of Australia,

44unless:(i)the aggregate consideration payable on acceptance of the offer by each offeree is at least
A$500,000 (or its equivalent in an alternate currency) (disregarding moneys lent by the offeror
or its associates) or the offer or invitation otherwise does not require disclosure to investors
under Part 6D.2 of the Corporations Act 2001 of the Commonwealth of Australia;(ii)such action complies with applicable laws, regulations and directives; and(iii) such action does not require any documents to be lodged with ASIC.
New Zealand
Each Dealer has acknowledged that the Information Memorandum has not been, nor will be,
registered with the New Zealand Registrar of Companies pursuant to the Securities Act 1978 of
New Zealand. Accordingly, each Dealer has represented and agreed that:(a)it has not offered for sale, or transferred, and will not directly or indirectly offer for sale, ortransfer, any Notes to any member of the public in New Zealand; and(b)

it will not distribute, publish, deliver or disseminate the Information Memorandum, any
pricing supplement or any information or other material that may constitute an advertisement(as defined in the Securities Act 1978 of New Zealand) in relation to any offer of the Securities
in New Zealand;in any such case, other than:(a)to persons whose principal business is the investment of money or who, in the course of andfor the purposes of their business, habitually invest money within the meaning of section
3(2)(a)(ii) of the Securities Act 1978 of New Zealand;(b)to persons who are each required to pay a minimum subscription price of at least
NZ$500,000.00 for the Notes (disregarding any amount lent by the offeror, the Bank or any
associated person of the offeror or the Bank) before the allotment of those Notes; or(c)in other circumstances where there is no contravention of the Securities Act 1978 of
New Zealand.

CanadaEach Dealer has acknowledged, represented and agreed that no prospectus in relation to the Notes
has been filed with the securities regulatory authority in any province or territory of Canada. The Notes
have not been and will not be qualified for sale under the securities laws of any province or territory ofCanada. Each Dealer has acknowledged, represented and agreed, and each further Dealer appointed
under the Facility will be required to represent and agree, that it has not offered, sold or distributed any
Notes, directly or indirectly, in Canada or to, or for the benefit of, any resident thereof, except incompliance with applicable securities laws in Canada or any province or territory of Canada.
Each Dealer has agreed not to distribute or deliver the Information Memorandum or any otheroffering material relating to the Notes, in Canada in contravention of the securities laws of Canada or any
province of territory thereof.
Notes offered in Canada may be subject to additional Canadian selling restrictions as the Bank andrelevant Dealer may agree as indicated in the relevant Pricing Supplement. Each Dealer will be required
to agree that it will offer, sell or distribute such Notes only in compliance with such additional Canadianselling restrictions and only pursuant to an exemption from the requirement to file a prospectus in theprovince or territory of Canada in which such offer is made.

45

FORM OF PRICING SUPPLEMENT
Pro Forma Pricing Supplement for an issue by African Development Bank under its Global Debt
Issuance Facility.
Pricing Supplement dated []AFRICAN DEVELOPMENT BANK
Global Debt Issuance Facility
for issues of Notes with maturities of one day or longer
Issue of [Aggregate Principal Amount of Series][Title of Notes]
This document constitutes the Pricing Supplement relating to the issue of Notes described herein.
This Pricing Supplement constitutes Final Terms for the purposes of listing and trading Notes on theRegulated Market of the Luxembourg Stock Exchange. Terms used herein shall be deemed to be definedas such for the purposes of the Conditions set forth in the Information Memorandum dated 8 September
2009 [and the supplemental Information Memorandum dated []]. This Pricing Supplement
contains the final terms of the Notes and must be read in conjunction with such Information
Memorandum [as so supplemented].
[The following alternative language applies if the first tranche of an issue which is being increased wasissued under an Information Memorandum with an earlier date.]
This document constitutes the Pricing Supplement relating to the issue of Notes described herein.
This Pricing Supplement constitutes Final Terms for the purposes of listing and trading Notes on theRegulated Market of the Luxembourg Stock Exchange. Terms used herein shall be deemed to be definedas such for the purposes of the Conditions set forth in the Information Memorandum dated [originaldate]. This Pricing Supplement contains the final terms of the Notes and must be read in conjunction with
the Information Memorandum dated 8 September 2009 [and the supplemental Information
Memorandum dated [ ]], save in respect of the Conditions which are extracted from the Information
Memorandum dated [original date] and are attached hereto.][Include whichever of the following apply or specify as ‘‘Not Applicable’’ (N/A). Note that the
numbering should remain as set out below, even if ‘‘Not Applicable’’ is indicated for individual paragraphs
or sub-paragraphs. Italics denote directions for completing the Pricing Supplement.]
1.
2.

3.
4.

Issuer:(i) Series Number:African Development Bank
[
]

(ii)

[
]
(If fungible with an existing Series, details of that
Series, including the date on which the Notes
become fungible)

Tranche Number:Specified Currency or Currencies:
Aggregate Nominal Amount:

[

]

(i)

Series:

[

]

5.

(ii)
(i)

Tranche:Issue Price:[][] per cent. of the Aggregate Nominal
Amount [plus accrued interest from [insert date](in the case of fungible issues only, if applicable)]

6.

(ii) Net proceeds:
Specified Denominations:[[] (Required only for listed issues)][Note – where multiple denominations above
A50,000 are being used, the following sample
wording should be used:‘‘A50,000 and integral multiples of [A1,000] in
excess thereof up to and including [A99,000]. No
Notes in definitive form will be issued in excess of[A99,000].
7.

(i)

Issue Date:

[
46

]

(ii)

Interest Commencement Date:

[

]

8.

*Maturity Date:[(for Fixed Rate Notes) specify date or (for Floating
Rate Notes) Interest Payment Date falling in ornearest to the relevant month and year]

9.

Interest Basis:[[] per cent. Fixed Rate] [[specify reference
rate] +/–[] per cent. Floating Rate] [ZeroCoupon] [Index-Linked Interest] [Dual Currency
Interest] [Variable Coupon Amount] [Other(specify)] (further particulars specified below)

10.

Redemption/Payment Basis:[Redemption at par] [Index-Linked Redemption][Dual Currency] [Variable Redemption Amount][Partly Paid] [Instalment] [Other (specify)]

11.

Change of Interest or Redemption/Payment
Basis:[Specify details of any provision for convertibilityof Notes into another interest or redemption/
payment basis]

12.

Put/Call Options:[Investor Put]
[Issuer Call][(further particulars specified below)]

13.

Status of the Notes:[Senior/Subordinated]

14.

Listing and Trading:[The regulated market of the Luxembourg Stock
Exchange for the purposes of Directive
2004/39/EC
on
Markets
inFinancial
Instruments/other (specify)/None]

15.

Method of distribution:[Syndicated/Non-syndicated]

PROVISIONS RELATING TO INTEREST (IF ANY) PAYABLE
16. Fixed Rate Note Provisions[Applicable/Not Applicable] (If not applicable,delete the remaining sub-paragraphs of thisparagraph)*(i)Rate[(s)] of Interest:[] per cent. per annum [payable[annually/semi-annually/quarterly/monthly/other(specify)] in arrear](ii)

Interest Payment Date(s):[] in each year [adjusted in accordancewith [specify Business Day Convention and any
applicable Business Centre(s) for the definition of‘‘Business Day’’]][, not adjusted](iii) Fixed Coupon Amount[(s)]:[] per [] in Nominal Amount(iv) Broken Amount(s):[Insert particulars of any initial or final brokeninterest amount which do not correspond with theFixed Coupon Amount[(s)] and the Interest
Payment Date(s) to which they relate](v)

Day Count Fraction:[30/360 or Actual/Actual (ICMA) or other(specify)](Consider if day count fraction, particularly forEuro denominated issues, should be on an Actual/
Actual basis)(vi) Determination Date(s):[ ] [Insert regular interest payment dates,
ignoring issue date or maturity date in the case ofa long or short first or last coupon N.B. only
relevant where Day Count Fraction is Actual/
Actual (ICMA)]

If the maturity date of the Notes issued in bearer form is one year or less select at No. 44 (Applicable TEFRA Rules) thatTEFRA rules are not applicable.

47

17.

(vii) Other terms relating to the method of
calculating interest for Fixed Rate Notes:[Not Applicable/give details]

Floating Rate Note Provisions[Applicable/Not Applicable] (If not applicable,delete the remaining sub-paragraphs of thisparagraph)(i)Interest Period(s):

[

]

(ii)

Specified Interest Payment Dates:[](iii) Business Day Convention:[Floating Rate Business Day Convention/
Following Business Day Convention/Modified
Following Business Day Convention/Preceding
Business Day Convention/other (give details)](iv) Business Centre(s):[(v)[Screen Rate Determination/ISDA
Determination/other (give details)]

Manner in which the Rate(s) of Interest
is/are to be determined:](vi) Interest Period Date(s):[Not Applicable/specify dates](vii) Party responsible for calculating theRate(s) of Interest and Interest
Amount(s) (if not the Issuing andPaying Agent):[]– Relevant Time:[]– Interest Determination Date:[[] [TARGET] Business Days [in [specify cityfor Specified Currency]] prior to [the first day ineach Interest Accrual Period/each Interest
Payment Date]]– Primary Source for Floating Rate:[Specify relevant screen page or ‘‘Reference
Banks’’]– Reference Banks (if Primary Source is‘‘Reference Banks’’):[Specify four]– Relevant Financial Centre:[The financial centre most closely connected to the
Benchmark – specify if not London]– Benchmark:[LIBOR, LIBID, LIMEAN, EURIBOR or otherbenchmark]– Representative Amount:[Specify if screen or Reference Bank quotations
are to be given in respect of a transaction of a
specified notional amount]– Effective Date:[Specify if quotations are not to be obtained witheffect from commencement of Interest Accrual
Period]– Specified Duration:[Specify period for quotation if not duration ofInterest Accrual Period](viii) Screen Rate Determination:(ix) ISDA Determination:– Floating Rate Option:[]– Designated Maturity:[]– Reset Date:[]– ISDA Definitions (if different fromthose set out in the Conditions:

[

]

48

(x)

18.

19.

20.

Relevant Margin(s):[+/–][] per cent. per annum(xi) Minimum Rate of Interest:[] per cent. per annum(xii) Maximum Rate of Interest:[] per cent. per annum(xiii) Day Count Fraction:[](xiv) Rate Multiplier:[](xv) Fall back provisions, rounding
provisions, denominator and any otherterms relating to the method of
calculating interest on Floating Rate
Notes, if different from those set out in
the Conditions:[]

Zero Coupon Note Provisions[Applicable/Not Applicable] (If not applicable,delete the remaining sub-paragraphs of thisparagraph)(i)

Amortisation Yield:[] per cent. per annum(ii)

Day Count Fraction:[](iii) Any other formula/basis of determining
amount payable:[]

Index-Linked Interest Note Provisions[Applicable/Not Applicable] (If not applicable,delete the remaining subparagraphs of thisparagraph)(i)

Index/Formula:[give or annex details](ii)

Calculation Agent responsible forcalculating the interest due:[](iii) Provisions for determining Coupon
where calculation by reference to Index
and/or Formula is impossible or
impracticable:[](iv) Interest Period(s):

[

]

(v)

[

]

Specified Interest Payment Dates:(vi) Business Day Convention:[Floating Rate Business Day Convention/
Following Business Day Convention/ Modified
Following Business Day Convention/Preceding
Business Day Convention/other (give details)](vii) Business Centre(s):[](viii) Minimum Rate of Interest:[] per cent. per annum(ix) Maximum Rate of Interest:[] per cent. per annum

(x)

[

]

Day Count Fraction:

Dual Currency Interest Note Provisions[Applicable/Not Applicable] (If not applicable,delete the remaining sub-paragraphs of thisparagraph)(i)

Rate of Exchange/method of calculating
Rate of Exchange:[give details](ii)

Calculation Agent, if any, responsible forcalculating the principal and/or interest
due:

[

49

]

21.

(iii) Provisions applicable where calculation
by reference to Rate of Exchange
impossible or impracticable:[(iv) Person at whose option Specified
Currency(ies) is/are payable:

[

(v)

[

Day Count Fraction:]]][Applicable/Not Applicable]
describe provisions]

Variable Coupon Amount Notes:[Ifapplicable,

PROVISIONS RELATING TO REDEMPTION
22.

Call Option[Applicable/Not Applicable] (If not applicable,delete the remaining sub-paragraphs of thisparagraph)(i)

Optional Redemption Date(s):

[

(ii)

Optional Redemption Amount(s) ofeach Note and method, if any,of calculation of such amount(s):[] perdenomination

]
Note

of

[

]

specified(iii) If redeemable in part:
(a)

23.

Minimum nominal amount to beredeemed:[](b) Maximum nominal amount to beredeemed:[](iv) Option Exercise Date(s):

[

]

(v)

[

]

(vi) Notice period (if other than as set out in
the Conditions):[]

Put Option[Applicable/Not Applicable] (If not applicable,delete the remaining sub-paragraphs of thisparagraph)(i)

Optional Redemption Date(s):

[

(ii)

Optional Redemption Amount(s) ofeach Note and method, if any, of
calculation of such amount(s):[] perdenomination

Description of any other option of the
Bank:

of

[

Early Redemption Amount(s) of each Notepayable on event of default and/or the methodof calculating the same (if required or if
different from that set out in the Conditions):[

Variable Redemption Amount Notes:[Applicable/Not Applicable]
describe provisions][If(iii) Option Exercise Date(s):[](iv) Description of any other Noteholders’option:

[

]

(v)

[

]

Notice period (if other than as set out in
the Conditions):

24.

Final Redemption Amount of each Note25.

Early Redemption Amount

26.

]
Note

]

specified[Par/other/see Appendix]

50]

applicable,

GENERAL PROVISIONS APPLICABLE TO THE NOTES
27.

(a)

Form of Notes:[Temporary Bearer Global Note exchangeable
for a Permanent Bearer Global Note which isexchangeable for Definitive Bearer Notes on not
more than 60 days’ notice/at any time/in thelimited circumstances specified in the Permanent
Global Note.]

Bearer Notes:[Temporary Bearer Global Note exchangeable
for Definitive Bearer Notes on not more than
60 days’ notice.][Permanent Bearer Global Note exchangeable
for Definitive Bearer Notes on not more than
60 days’ notice/at any time/in the limited
circumstances specified in the Permanent Bearer
Global Note].
Registered Notes:
Registrar and Transfer Agents[Name and specified offices](i)[Yes/No/give details]

DTC Application(ii) Australian Domestic Notes:[Yes/No] [If yes, set out relevant provisions][(b) New Global Note:[Yes/No]]

28.

Relevant Financial Centre(s) or other special
provisions relating to payment dates:[Not Applicable/give details. Note that this item
relates to the date and place of payment, and notinterest period end dates, to which items 16(ii),
17(iv) and 19(vii) relate]29.

Talons for future Coupons to be attached toDefinitive Bearer Notes (and dates on whichsuch Talons mature):[Yes/No. If yes, give details]

30.

Details relating to Partly Paid Notes: amountof each payment comprising the Issue Priceand date on which each payment is to be madeand consequences (if any) of failure to pay,
including any right of the Issuer to forfeit theNotes and interest due on late payment:[Not Applicable/give details]

31.

Details relating to Instalment Notes:
Instalment Amount, date on which eachpayment is to be made (Instalment Date):[Not Applicable/give details including of any
minimum or maximum instalment amount]32.

Redenomination, renominalisation andreconventioning provisions:[Not Applicable/The provisions annexed to thisPricing Supplement apply]

33.

Consolidation provisions:[Not Applicable/The provisions annexed to thisPricing Supplement apply]

34.

Other terms or special conditions:[Not Applicable/give details including any details
relevant to Other Notes, being Notes of a type notspecifically contemplated elsewhere in this Pricing
Supplement]

35.

Governing law:[English/please specify]

DISTRIBUTION
36.

(i)

If syndicated, names of Managers:[Not Applicable/give names](ii)

Stabilising Manager (if any):[Not Applicable/give name]

51

37.

If non-syndicated, name of Dealer:[Not Applicable/give name]38.

Additional selling restrictions:[Not Applicable/give details]

OPERATIONAL INFORMATION
39.

ISIN Code:

[

]

40.

Common Code:

[

]

41.

Any clearing system(s) other than Euroclear
and Clearstream, Luxembourg and therelevant identification number(s):[Not Applicable/give name(s) and number(s)]42.

Delivery:

Delivery [against/free of] payment

43.

Changes to the Agent(s) (if any):[

44.

Applicable TEFRA Rules:

D Rules/Not Applicable

45.

Additional United States Federal Income Tax
Consequences:[Not Applicable/give details]

46.

Intended to be held in a manner that would
allow Eurosystem eligibility:[Yes/No]][Note that the designation ‘‘yes’’ simply meansthat the Notes are intended upon issue to bedeposited with one of the ICSDs as common
safekeeper and does not necessarily mean that
the Notes will be recognised as eligible collateralfor Eurosystem monetary policy and intra-day
credit operations by the Eurosystem either uponissue or at any or all times during their life. Such
recognition will depend upon satisfaction of theEurosystem eligibility criteria.] [include this text if‘‘yes’’ selected in which case the Notes must be
issued in NGN form][LISTING APPLICATIONThis Pricing Supplement comprises the final terms required for issue and admission to trading on
the Regulated Market of the Luxembourg Stock Exchange and admission to trading on the Official Listof the Luxembourg Stock Exchange of the Notes described herein pursuant to the Global Debt Issuance
Facility of the African Development Bank.]
NO MATERIAL ADVERSE CHANGE
There has been no material adverse change in the financial position of the Bank since [insert date oflast published audited accounts].
AUDITORS
The annual accounts of the Bank for the financial years ended [insert year] and [insert year],respectively, have been audited by [insert name of auditors].
RESPONSIBILITY
The Issuer accepts responsibility for the information contained in this Pricing Supplement.
Signed on behalf of African Development Bank:

By:
Duly Authorised

52

GENERAL INFORMATION
1.
By resolutions dated 20 December 2000 and 6 December 2001 the Board of Directors of the
Bank authorised the establishment of an unlimited global debt issuance facility and the issuance of Notes
thereunder.
2.

The Notes will not be issued under an indenture, and no trustee is provided for in the Notes.

3.
The Bank is not and has not been involved in any litigation, arbitration or administrative
proceedings relating to claims or amounts which are material in the context of the Notes or may have, or
have had during the previous twelve months, a significant effect on its financial position, nor, so far as it isaware, having made all reasonable enquiries, are any such litigation, arbitration or administration
proceedings pending or threatened.
4.
There has been no material adverse change in the financial position of the Bank since
31 December 2008.
5.
The annual accounts of the Bank for the financial years ended 31 December 2007 and
31 December 2008, respectively, have been audited by KPMG Audit.
6.
For so long as any Notes are outstanding, copies of the following documents may be inspected
free of charge during normal business hours at and, (in the case of items (b), (e) and (f) available from)the specified office of the Paying Agent in Luxembourg:(a)the Dealer Agreement;(b)the latest Annual Report of the Bank;(c)the Issuing and Paying Agency Agreement;(d)the Deed of Covenant;(e)each Pricing Supplement relating to a Series of Notes which are listed on the regulated marketof the Luxembourg Stock Exchange;(f)the Information Memorandum and any supplements thereto; and(g)the Information Statement and any amendments or supplements thereto.

7.
The Notes have been accepted for clearance through Euroclear and Clearstream,
Luxembourg which are the entities in charge of keeping the records. The Bank will apply toAustraclear for approval of each Series of Australian Domestic Notes to be traded in the Austraclear
System. The appropriate codes allocated by Euroclear and Clearstream, Luxembourg for each Series ofNotes, together with the relevant International Security Identification Number (‘‘ISIN’’), will becontained in the Pricing Supplement relating thereto. Transactions can be settled between DTC,
Euroclear and Clearstream, Luxembourg. The relevant Pricing Supplement shall specify any otherclearing system as shall have accepted the relevant Notes for clearance together with any further
appropriate information.
8.
The Luxembourg Stock Exchange has allocated to the Facility the number 2260 for listing
purposes.
9.
No person asserts any claim of proprietary ownership or exclusive right with respect to any
feature of the tax structure or the tax aspects of the transactions described herein, and the Bank and its
affiliates authorise each of the prospective investors (and each employee, representative, or other agentof any prospective investor) to disclose to any and all persons, without limitation of any kind, the tax
treatment and tax structure of the transaction and all materials of any kind (including opinions and othertax analyses) that are provided to the prospective investor relating to such tax treatment and tax
structure.
10. This Information Memorandum and any supplements thereto, the latest Annual Report of the
Bank and any Pricing Supplement will be available on the internet website of the Luxembourg Stock
Exchange (www.bourse.lu).

53

PRINCIPAL OFFICE OF THE BANK
African Development Bank
01 B. P. 1387 Abidjan
Côte d’Ivoire
Temporary Relocation Agency
15 Avenue du Ghana BP 323
1002 Tunis Belvedere
Tunisia
THE ARRANGER
Citigroup Global Markets Limited
Citigroup Centre
Canada Square
Canary Wharf
London E14 5LB
THE DEALERS
Australia and New Zealand
Banking Group Limited
Level 2, 20 Martin Place
Sydney NSW 2000
Australia

Barclays Bank PLC
5 The North Colonnade
Canary Wharf
London E14 4BB

BNP PARIBAS
10 Harewood Avenue
London NW1 6AA

Citigroup Global Markets Limited
Citigroup Centre
Canada Square
Canary Wharf
London E14 5LB

Commerzbank Aktiengesellschaft
Kaiserstraße 16 (Kaiserplatz)
60311 Frankfurt am Main

Credit Suisse Securities (Europe) Limited
One Cabot Square
London E14 4QJ

Daiwa Securities SMBC Europe Limited
5 King William Street
London EC4N 7AX

Goldman Sachs InternationalPeterborough Court
133 Fleet Street
London EC4A 2BB

HSBC Bank plc
8 Canada Square
London E14 5HQ

J.P. Morgan Securities Ltd.
125 London WallLondon EC2Y 5AJ

Merrill Lynch International
Merrill Lynch Financial Centre
2 King Edward Street
London EC1A 1HQ

Mitsubishi UFJ Securities International plc
6 Broadgate
London EC2M 2AA

Mizuho International plc
Bracken HouseOne Friday Street
London EC4M 9JA

Morgan Stanley & Co. International plc
25 Cabot Square
Canary Wharf
London E14 4QA

Nomura International plc
Nomura House
1 St. Martin’s-le-Grand
London EC1A 4NP

Shinkin International Ltd.
4th Floor, River Plate House
7-11 Finsbury Circus
London EC2M 7YA

Société Générale
29, Boulevard Haussmann
75009 Paris 17

Standard Bank Plc
20 Gresham Street
London EC2V 7JE

Standard Chartered Bank
6 Battery Road
#03-00Singapore 049909

The Toronto-Dominion Bank
Triton Court
14/18 Finsbury Square
London EC2A 1DB
LEGAL ADVISERS

Legal Department
African Development Bank
Temporary Relocation Agency
15 Avenue du Ghana BP 323
1002 Tunis Belvedere
Tunisia
To the Issuer as to English law and US Federal law
Linklaters LLP
One Silk Street
London EC2Y 8HQ

To the Dealers as to English law
and US Federal Tax law
Allen & Overy LLP
One Bishops Square
London E1 6AD

ISSUING AND PAYING AGENT AND REGISTRAR
Citibank, N.A.
Citigroup Centre
Canary Wharf
London E14 5UB
TRANSFER AGENT
Dexia Banque Internationale à Luxembourg
69 route d’Esch
L-2953 Luxembourg
PAYING AGENTS
Dexia Banque Internationale à Luxembourg
69 route d’Esch
L-2953 Luxembourg

The Bank of New York Mellon
Rue Montoyerstraat, 46
B-1000 Brussels
Belgium

AUDITORS TO THE BANKKPMG Audit
1, Cours Valmy
92923 Paris
La Défense Cedex
FranceLUXEMBOURG LISTING AGENT
Dexia Banque Internationale à Luxembourg
69 route d’Esch
L-2953 LuxembourgRF64051

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