Exhibit 4.2


 





Execution
Version







 









 






  


THE ROYAL BANK OF SCOTLAND GROUP PLC


 


as Company


 


and


 


THE BANK OF NEW YORK MELLON, ACTING THROUGH
ITS LONDON BRANCH


 


as Trustee




 









 






 





SECOND SUPPLEMENTAL INDENTURE


 


dated as of June 25, 2018


 


to the


 


AMENDED AND RESTATED INDENTURE


 


dated as of December 13, 2017


 


$1,250,000,000 4.519% Fixed Rate/Floating
Rate Notes due 2024

$750,000,000 Floating Rate Notes due 2024


 






     


     


    

This SECOND SUPPLEMENTAL INDENTURE, dated
as of June 25, 2018, among THE ROYAL BANK OF SCOTLAND GROUP PLC, a corporation incorporated in Scotland with registered number
SC045551, as issuer (the “Company”) and THE BANK OF NEW YORK MELLON, acting through its London Branch, a banking
corporation duly organized and existing under the laws of the State of New York, as trustee (the “Trustee”)
having its Corporate Trust Office at One Canada Square, London E14 5AL.


 


WITNESSETH:


 


WHEREAS, the Company and the Trustee have
executed and delivered an amended and restated Indenture dated as of December 13, 2017 (the “Base Indenture”)
to provide for the issuance of the Company’s Senior Debt Securities from time to time;


 


WHEREAS, Section 9.01(f) of the Amended
and Restated Indenture provides that the Company and the Trustee may enter into a supplemental indenture to establish the forms
or terms of the Senior Debt Securities of any series without the consent of Holders as permitted under Sections 2.01 and 3.01 of
the Amended and Restated Indenture;


 


WHEREAS, the Company desires to issue, as
two series of Senior Debt Securities under the Base Indenture, $1,250,000,000 4.519% Fixed Rate/Floating Rate Notes due 2024 (the
“Fixed/Floating Rate Notes”) and $750,000,000 Floating Rate Notes due 2024 (the “Floating Rate Notes”
and, together with the Fixed/Floating Rate Notes, the “Senior Notes”) to be issued pursuant to this Second Supplemental
Indenture dated as of June 25, 2018 (the “Second Supplemental Indenture” and, together with the Base Indenture,
the “Indenture”);


 


WHEREAS, this Second Supplemental Indenture
shall amend and supplement the Base Indenture except where this Second Supplemental Indenture only applies to the Senior Notes;
to the extent that the terms of the Base Indenture are inconsistent with the provisions of this Second Supplemental Indenture,
the terms of this Second Supplemental Indenture shall govern;


 


WHEREAS, there are no debt securities outstanding
of any series created prior to the execution of this Second Supplemental Indenture which are entitled to the benefit of the provisions
set forth herein or would be adversely affected by such provisions;


 


WHEREAS, the entry into of this Second Supplemental
Indenture has been authorized pursuant to a Board Resolution as required by Section 9.01 of the Base Indenture;


 




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WHEREAS, the Company has requested that
the Trustee execute and deliver this Second Supplemental Indenture, and whereas all actions required by it to be taken in order
to make this Second Supplemental Indenture a valid, binding and enforceable instrument in accordance with its terms have been taken
and performed, and the execution and delivery of this Second Supplemental Indenture has been duly authorized in all respects; and


 


NOW, THEREFORE, the Company and the Trustee
mutually covenant and agree as follows:


 


Article
1

DEFINITIONS


 


Section 1.01.Definition of Terms.
For all purposes of this Second Supplemental Indenture:


 


(a)  a
term defined anywhere in this Second Supplemental Indenture has the same meaning throughout;


 


(b)  capitalized
terms used but not otherwise defined herein shall have the meanings assigned to them in the Base Indenture;


 


(c)  the
singular includes the plural and vice versa;


 


(d)  headings
are for convenience of reference only and do not affect interpretation; and


 


(e)  for
purposes of this Second Supplemental Indenture and the Base Indenture, the term “series” shall mean the series
of securities designated as the Senior Notes.


 


Article
2

THE SENIOR DEBT SECURITIES


 


Section 2.01.Terms specific to
the Fixed/Floating Rate Notes. The following terms relating to the Fixed/Floating Rate Notes are hereby established pursuant
to Section 3.01 of the Base Indenture:


 


(a)  The
title of the Fixed/Floating Rate Notes shall be the “4.519% Fixed Rate/Floating Rate Notes due 2024”;


 


(b)  The
aggregate principal amount of the Fixed/Floating Rate Notes that may be authenticated and delivered under the Indenture shall not
initially exceed $1,250,000,000 (except as otherwise provided in the Indenture);


 




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(c)  Principal
on the Fixed/Floating Rate Notes shall be payable on June 25, 2024 (the “Fixed/Floating Rate Notes Maturity Date”),
unless earlier redeemed in accordance with the provisions set forth in Article 11 of the Indenture;


 


(d)  The
Fixed/Floating Rate Notes shall be issued in global registered form on or about June 25, 2018;


 


(e)  From
(and including) June 25, 2018, to (but excluding) June 25, 2023 (such period, the “Fixed/Floating Rate Notes Fixed Rate
Period”), interest on the Fixed/Floating Rate Notes will be payable at a rate of 4.519% per annum (the “Fixed/Floating
Rate Notes Fixed Interest Rate”). During the Fixed/Floating Rate Notes Fixed Rate Period, interest on the Fixed/Floating
Rate Notes will be payable semi-annually in arrear on June 25 and December 25 of each year, beginning on December 25, 2018 (each,
a “Fixed/Floating Rate Notes Fixed Rate Period Interest Payment Date”) to (and including) June 25, 2023.


 


From (and including) June 25, 2023
to (but excluding) the Fixed/Floating Rate Notes Maturity Date (such period, the “Fixed/Floating Rate Notes Floating Rate
Period”), the interest rate on the Fixed/Floating Rate Notes will be equal to the three-month U.S. dollar London interbank
offered rate (“LIBOR”), as determined by the Calculation Agent on the applicable Fixed/Floating Rate Notes Interest
Determination Date, plus 1.550% per annum, accruing from June 25, 2023, to (but excluding) the Fixed/Floating Rate Notes Maturity
Date. During the Fixed/Floating Rate Notes Floating Rate Period, interest on the Fixed/Floating Rate Notes will be payable quarterly
in arrear on September 25, 2023, December 25, 2023, March 25, 2024 and June 25, 2024, beginning on September 25, 2023 to (and including)
the Fixed/Floating Rate Notes Maturity Date (each, a “Fixed/Floating Rate Notes Floating Rate Period Interest Payment
Date” and, together with each Fixed/Floating Rate Notes Fixed Rate Period Interest Payment Date, each an “Fixed/Floating
Rate Notes Interest Payment Date”) and will be reset quarterly on June 25, 2023, September 25, 2023, December 25, 2023
and March 25, 2024, beginning on June 25, 2023 (each a “Fixed/Floating Rate Notes Interest Reset Date”).


 


During the Fixed/Floating Rate Notes
Fixed Rate Period:


 


(i)  Interest
will be calculated on the basis of twelve 30-day months or, in the case of an incomplete month, the actual number of days elapsed,
in each case assuming a 360-day year; and


 


(ii)  If
any scheduled interest payment date is not a business day, such interest payment date will be postponed to the next day that is
a


 




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business day, but interest on that
payment will not accrue during the period from and after the scheduled interest payment date.


 


During the Fixed/Floating Rate Notes
Floating Rate Period:


 


(i)  Interest
will be calculated on the basis of the actual number of days in each interest period, assuming a 360-day year. An interest period
will be the period beginning on (and including) a Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date and ending
on (but excluding) the next succeeding Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date; provided
that the first floating rate interest period will begin on June 25, 2023 and will end on (but exclude) the first Fixed/Floating
Rate Notes Floating Rate Period Interest Payment Date.


 


(ii)  If
any scheduled Fixed/Floating Rate Notes Interest Reset Date or Fixed/Floating Rate Notes Floating Rate Period Interest Payment
Date (other than the Fixed/Floating Rate Notes Maturity Date) is not a business day, such Fixed/Floating Rate Notes Interest Reset
Date or Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date will be postponed to the next day that is a business
day; provided that if that business day falls in the next succeeding calendar month, such Fixed/Floating Rate Notes
Interest Reset Date or Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date will be the immediately preceding business
day. If any such Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date (other than the Fixed/Floating Rate Notes
Maturity Date) is postponed or brought forward as described above, the payment of interest due on such postponed or brought forward
Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date will include interest accrued to but excluding such postponed
or brought forward Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date;


 


(f)  The
regular record dates for the Fixed/Floating Rate Notes will be the 15th calendar day preceding each Fixed/Floating Rate Notes Interest
Payment Date, whether or not a business day;


 


(g)  No
premium, upon redemption or otherwise, shall be payable by the Company on the Fixed/Floating Rate Notes; and


 


(h)  The
form of the Fixed/Floating Rate Notes shall be evidenced by one or more global notes in registered form substantially in the form
of Exhibit A attached to this Second Supplemental Indenture and made a part thereof.


 




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Section 2.02.Terms specific to
the Floating Rate Notes. The following terms relating to the Floating Rate Notes are hereby established pursuant to Section
3.01 of the Base Indenture:


 


(a)  The
title of the Floating Rate Notes shall be the “Floating Rate Notes due 2024”;


 


(b)  The
aggregate principal amount of the Floating Rate Notes that may be authenticated and delivered under the Indenture shall not initially
exceed $750,000,000 (except as otherwise provided in the Indenture);


 


(c)  Principal
on the Floating Rate Notes shall be payable on June 25, 2024 (the “Floating Rate Notes Maturity Date”), unless
earlier redeemed in accordance with the provisions set forth in Article 11 of the Indenture;


 


(d)  The
Floating Rate Notes shall be issued in global registered form on or about June 25, 2018;


 


(e)  From
(and including) June 25, 2018 to (but excluding) the Floating Rate Notes Maturity Date, the interest rate on the Floating Rate
Notes will be equal to the three-month U.S. dollar LIBOR, as determined by the Calculation Agent on the applicable Floating Rate
Notes Interest Determination Date, plus 1.550% per annum (the “Floating Rate Notes Interest Rate”), accruing
from June 25, 2018, to (but excluding) the Floating Rate Notes Maturity Date. Interest on the Floating Rate Notes will be payable
quarterly in arrear on March 25, June 25, September 25 and December 25 of each year, beginning on September 25, 2018 to (and including)
the Floating Rate Notes Maturity Date (each, a “Floating Rate Notes Interest Payment Date” and, together with
each Fixed/Floating Rate Notes Interest Payment Date, each an “Interest Payment Date”) and will be reset quarterly
on March 25, June 25, September 25 and December 25 of each year, beginning on September 25, 2018 (each a “Floating Rate
Notes Interest Reset Date” and, together with each Fixed/Floating Rate Notes Interest Reset Date, each an “Interest
Reset Date”).


 


For the Floating Rate Notes:


 


(i)  Interest
will be calculated on the basis of the actual number of days in each interest period, assuming a 360-day year. An interest period
will be the period beginning on (and including) a Floating Rate Notes Interest Payment Date and ending on (but excluding) the next
succeeding Floating Rate Notes Interest Payment Date; provided that the first floating rate interest period will begin
on June 25, 2018 and will end on (but exclude) the first Floating Rate Notes Interest Payment Date.


 




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(ii)  If
any scheduled Floating Rate Notes Interest Reset Date or Floating Rate Notes Interest Payment Date (other than the Floating Rate
Notes Maturity Date) is not a business day, such Floating Rate Notes Interest Reset Date or Floating Rate Notes Interest Payment
Date will be postponed to the next day that is a business day; provided that if that business day falls in the next
succeeding calendar month, such Floating Rate Notes Interest Reset Date or Floating Rate Notes Interest Payment Date will be the
immediately preceding business day. If any such Floating Rate Notes Interest Payment Date (other than the Floating Rate Notes Maturity
Date) is postponed or brought forward as described above, the payment of interest due on such postponed or brought forward Floating
Rate Notes Interest Payment Date will include interest accrued to but excluding such postponed or brought forward Floating Rate
Notes Interest Payment Date;


 


(f)  The
regular record dates for the Floating Rate Notes will be the 15th calendar day preceding each Floating Rate Notes Interest Payment
Date, whether or not a business day;


 


(g)  No
premium, upon redemption or otherwise, shall be payable by the Company on the Floating Rate Notes; and


 


(h)  The
form of the Floating Rate Notes shall be evidenced by one or more global notes in registered form substantially in the form of
Exhibit B attached to this Second Supplemental Indenture and made a part thereof.


 


Section 2.03.Terms specific to
each series of Senior Notes. The following terms relating to both the Fixed/Floating Rate Notes and the Floating Rate Notes
are hereby established pursuant to Section 3.01 of the Base Indenture:


 


(a)  Principal
of and any interest on the Senior Notes shall be paid to the Holder through The Bank of New York Mellon, as paying agent of the
Company having offices in London, United Kingdom;


 


(b)  The
Senior Notes shall not be redeemable except as provided in Article 11 of the Base Indenture as amended by ‎Section 3.07 and
‎Section 3.08 of this Second Supplemental Indenture. The Senior Notes shall not be redeemable at the option of the Holders
at any time. In connection with any redemption of Senior Notes pursuant to Section 11.08 of the Base Indenture, the date referenced
therein shall be June 25, 2018.


 


(c)  The
Company shall have no obligation to redeem or purchase the Senior Notes pursuant to any sinking fund or analogous provision;


 




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(d)  The
Senior Notes shall be issued only in denominations of $200,000 and integral multiples of $1,000 in excess thereof;


 


(e)  The
principal amount of, and any accrued interest on, the Senior Notes shall be payable upon the declaration of acceleration thereof
pursuant to Section 5.02 of the Base Indenture, as amended by ‎Section 3.04 of this Second Supplemental Indenture;


 


(f)  Additional
Amounts shall only be payable on the Senior Notes pursuant to Section 10.04 of the Base Indenture;


 


(g)  The
Senior Notes shall not be converted into or exchanged at the option of the Company for stock or other securities of the Company;


 


(h)  The
Senior Notes shall be denominated in U.S. Dollars;


 


(i)  The
payment of principal of and interest, if any, on the Senior Notes shall be payable in U.S. Dollars;


 


(j)  The
payment of principal of and interest, if any, on the Senior Notes shall be payable only in the coin or currency in which the Senior
Notes are denominated which, pursuant to ‎(h) above, shall be U.S. Dollars;


 


(k)  The
Senior Notes will be issued in the form of one or more global securities in registered form, without coupons attached, and the
initial Holder with respect to each such global security shall be Cede & Co., as nominee of The Depository Trust Company;


 


(l)  Except
in limited circumstances, the Senior Notes will not be issued in definitive form;


 


(m)  The
Calculation Agent for the Senior Notes is National Westminster Bank Plc or its successor appointed by the Company, pursuant to
a calculation agent agreement expected to be entered into on June 25, 2018;


 


(n)  Subject
to ‎Section 2.03(o) below, LIBOR shall be determined by the Calculation Agent in accordance with the following provisions:


 


		i.	With respect to any Interest Determination Date, LIBOR will be the rate (expressed as a percentage per annum) for deposits
in U.S. dollars having a maturity of three months commencing on the related Interest Reset Date that appears on Reuters Page LIBOR01
as of 11:00 a.m., London time, on that Interest Determination Date. If no such rate appears, then LIBOR, in respect of that Interest
Determination Date,



 




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will be determined in accordance
with the provisions described in (ii) below.


 


		ii.	With respect to an Interest Determination Date on which no rate appears on Reuters Page LIBOR01(as defined below), the Calculation
Agent will request the principal London offices of each of four major reference banks in the London interbank market, as selected
and identified by the Company, to provide its offered quotation (expressed as a percentage per annum) for deposits in U.S. dollars
for the period of three months, commencing on the related Interest Reset Date, to prime banks in the London interbank market at
approximately 11:00 a.m., London time, on that Interest Determination Date and in a principal amount that is representative for
a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, then LIBOR on that Interest
Determination Date will be the arithmetic mean of those quotations. If fewer than two quotations are provided, then LIBOR on the
Interest Determination Date will be the arithmetic mean of the rates quoted at approximately 11:00 a.m., in the City of New York,
on the Interest Determination Date by three major banks in the City of New York, as selected and identified by the Company, for
loans in U.S. dollars to leading European banks, for a period of three months, commencing on the related Interest Reset Date, and
in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. If at least
two such rates are so provided, LIBOR on the Interest Determination Date will be the arithmetic mean of such rates. If fewer than
two such rates are so provided, LIBOR on the Interest Determination Date will be LIBOR in effect with respect to the immediately
preceding Interest Determination Date or, in the case of the initial Interest Determination Date, (i) in respect of the Fixed/Floating
Rate Notes, such rate as may be determined by such alternate method as reasonably selected by the Calculation Agent and (ii) in
respect of the Floating Rate Notes, the first Floating Rate Notes Interest Rate.



 


“Interest Determination Date”
means the second London banking day preceding each Fixed/Floating Rate Notes Interest Reset Date or Floating Rate Notes Interest
Reset Date, as applicable.


 


All percentages resulting from any calculation
of any interest rate on the Senior Notes will be rounded, if necessary, to the nearest one hundred thousandth of a percentage point,
with five one-millionths of a percentage point rounded upward, and all dollar amounts would be rounded to the nearest cent, with
one-half cent being rounded upward;


 




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(o)  Notwithstanding
the provisions described above under ‎Section 2.03(n) above, if the Company (in consultation with the Calculation Agent to
the extent practicable) determines that LIBOR has ceased to be published on Reuters Page LIBOR01 as a result of LIBOR ceasing to
be calculated or administered, then the following provisions will apply:


 


(i)  the
Company will use reasonable endeavors to appoint an Independent Adviser to determine a Successor Rate or, alternatively, if the
Independent Adviser determines that there is no Successor Rate, an Alternative Reference Rate, no later than 5 business days prior
to an Interest Determination Date (the “IA Determination Cut-off Date”), for purposes of determining the rate
of interest for a Floating Rate Interest Period;


 


(ii)  if
the Company is unable to appoint an Independent Adviser, or the Independent Adviser appointed by the Company fails to determine
a Successor Rate or an Alternative Reference Rate prior to the IA Determination Cut-off Date, then the Company (in consultation
with the Calculation Agent to the extent practicable and acting in good faith) may determine a Successor Rate, or if the Company
determines that there is no Successor Rate, an Alternative Reference Rate, for purposes of determining the rate of interest for
a Floating Rate Interest Period; provided, however, that if the Company is unable or unwilling to determine a Successor
Rate or an Alternative Reference Rate prior to an Interest Determination Date in accordance with this sub-paragraph (ii), the rate
of interest will be equal to the rate of interest in effect with respect to the immediately preceding Interest Determination Date,
or, in the case of the initial Interest Determination Date, the rate of interest will be equal to the Fixed Interest Rate in the
case of the Fixed/Floating Rate Notes and the first Floating Rate Notes Interest Rate in the case of the Floating Rate Notes.


 


If a Successor Rate or Alternative
Reference Rate is determined in accordance with the preceding provisions, such Successor Rate or Alternative Reference Rate shall
be substituted for LIBOR for all future Floating Rate Interest Periods.


 


If the Independent Adviser (in
consultation with the Company) or the Company, as applicable, determines that an Adjustment Spread is required to be applied to
the Successor Rate or the Alternative Reference Rate, as applicable, and determines the quantum of, or a formula or methodology
for determining, such Adjustment Spread, then such Adjustment Spread shall be applied to the Successor Rate or the Alternative
Reference Rate, as applicable. If the


 




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Independent Adviser is, or the Company
is, as the case may be, unable to determine the quantum of, or a formula or methodology for determining, such Adjustment Spread,
then such Successor Rate or Alternative Reference Rate, as applicable, will apply without an Adjustment Spread.


 


If the Independent Adviser or
the Company, as the case may be, determines a Successor Rate or Alternative Reference Rate or, in each case, any Adjustment Spread,
in accordance with the above provisions, the Independent Adviser or the Company may also, following consultation with the Calculation
Agent to the extent practicable, specify changes to the Successor Rate or Alternative Reference Rate, as applicable, or, in each
case, the Adjustment Spread, as well as the day count fraction, business day convention, the definition of business day, the Interest
Determination Date or the Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date, the Floating Rate Notes Interest
Payment Date, and related provisions and definitions. All such changes can be made in order to follow market practice in relation
to the Successor Rate or Alternative Reference Rate and such changes shall apply to the Senior Notes for all future Floating Rate
Interest Periods. Upon receipt of satisfactory documentation, the Trustee shall, at our direction and expense, effect such amendments
as may be required in order to give effect to this ‎Section 2.03(o) pursuant to a supplemental indenture or an amendment to
the Indenture, or issuances and authentication of new global or definitive notes in respect of any series of the Senior Notes,
and the Trustee shall not be liable to any party for any consequences thereof, save as provided in the Indenture and the Senior
Notes. No Holder consent will be solicited or required in connection with effecting the Successor Rate or Alternative Reference
Rate or related changes, including for the execution of any documents, amendments to the Indenture or Senior Notes or other steps
by the Company, the Trustee, the Calculation Agent or the principal paying agent (if required). The Company will, promptly following
the determination of any Successor Rate, Alternative Reference Rate or Adjustment Spread, give notice thereof and of any changes
to the terms of the Senior Notes to the Trustee, the Calculation Agent, the principal paying agent and the Holders, in accordance
with Section 1.05 and Section 1.06 of the Base Indenture. By its acquisition of Senior Notes, each Holder and Beneficial Owner
of the Senior Notes and each subsequent Holder and Beneficial Owner acknowledges, accepts, agrees to be bound by, and consents
to, the Independent Adviser or the Company’s, as applicable, determination of the Successor Rate, Alternative Reference Rate
or Adjustment Spread, as applicable, any changes in connection therewith as contemplated by this provision, and to any amendment
or alteration of the terms of the Senior Notes, including an amendment of the amount of interest due on the Senior Notes, as may
be required in order to give effect to this ‎Section 2.03(o). The Trustee shall be entitled to rely on this deemed consent
in connection with any supplemental indenture or amendment


 




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which may be necessary to effect
the Successor Rate or Alternative Reference Rate.


 


By its acquisition of Senior
Notes, each Holder of Senior Notes waives any and all claims against the Trustee, the Calculation Agent and the principal paying
agent for, agrees not to initiate a suit against the Trustee, the Calculation Agent and the principal paying agent in respect of,
and agrees that neither the Trustee, the Calculation Agent or the principal paying agent will be liable for, any action that the
Trustee, the Calculation Agent or the paying agent, as the case may be, takes, or abstains from taking, in each case in accordance
with this ‎Section 2.03(o). By its acquisition of Senior Notes, each Holder of Senior Notes agrees that neither the Trustee,
the Calculation Agent or the principal paying agent will have any obligation to determine any Successor Rate, Alternative Reference
Rate or Adjustment Spread (including any adjustments thereto), including in the event of any failure by us to determine any Successor
Rate, Alternative Reference Rate or Adjustment Spread.


 


An Independent Adviser appointed
pursuant to this section shall act in good faith and (in the absence of bad faith, gross negligence or willful misconduct) shall
have no liability whatsoever to the Company, the Trustee, the Calculation Agent or any Holder or Beneficial Owner for any determination
made by it or for any advice given to the Company in connection with any determination made by the Company, pursuant to this ‎Section
2.03(o).


 


No Successor Rate or Alternative
Reference Rate will be adopted pursuant to this ‎Section 2.03(o), nor will any other amendment to the terms of the Senior Notes
be made, if and to the extent that, in the Company’s determination, the same could reasonably be expected to prejudice the
qualification of the Senior Notes as the Company’s and/or the Regulatory Group’s minimum requirements for (A) own funds
and eligible liabilities and/or (B) loss absorbing capacity instruments.


 


(p)  The
Events of Default on the Senior Notes are as set forth in Section 5.01 of the Base Indenture as amended by ‎Section 3.03 of
this Second Supplemental Indenture; and


 


(q)  The
Company may issue additional Senior Notes (“Additional Senior Notes”) after the date hereof having the same
ranking and same interest rate, Maturity Date, redemption terms and other terms as the Senior Notes except for the price to the
public and issue date, provided however that if such additional notes have the same CUSIP, ISIN and/or Common Code as the Outstanding
Senior Notes, such additional notes must be fungible with the Senior Notes for U.S. federal income tax purposes. Any such Additional
Senior Notes, together with the Senior Notes will constitute a single series of securities


 




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under the Indenture. There is no
limitation on the amount of notes or other debt securities that the Company may issue under the Indenture.


 


Article
3

AMENDMENTS TO THE BASE INDENTURE


 


Section 3.01.Addition of Definitions.
With respect to the Senior Notes only, Section 1.01 of the Base Indenture is amended to include the following definitions (which
shall be deemed to arise in Section 1.01 in their proper alphabetical order):


 


“Adjustment
Spread” means a spread (which may be positive or negative) or formula or methodology for calculating a spread, which
the Independent Adviser (in consultation with the Company) or the Company, as applicable, determines is required to be applied
to the Successor Rate or the Alternative Reference Rate, as applicable, as a result of the replacement of LIBOR with the Successor
Rate or the Alternative Reference Rate, as applicable, and is the spread, formula or methodology which:


 


(i)  in
the case of a Successor Rate, is recommended in relation to the replacement of LIBOR with the Successor Rate by any Relevant Nominating
Body;


 


(ii)  in
the case of a Successor Rate for which no such recommendation has been made or in the case of an Alternative Reference Rate, the
Independent Adviser (in consultation with the Company) or the Company, as applicable, determines is recognized or acknowledged
as being in customary market usage for the purposes of determining floating rates of interest in respect of securities denominated
in U.S. dollars, where such rate has been replaced by the Successor Rate or the Alternative Reference Rate, as applicable; or


 


(iii)  if
no such customary market usage is recognized or acknowledged, the Independent Adviser in its discretion (in consultation with the
Company), or the Company in its discretion, as applicable, determines (acting in good faith) to be appropriate.


 


“Alternative
Reference Rate” means, in respect of each series, the reference rate (and related alternative screen page or source,
if available) that the Independent Adviser or the Company (as applicable) determines has replaced LIBOR in customary


 




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market usage for
the purposes of determining floating rates of interest in respect of securities denominated in U.S. dollars, or, if the Independent
Adviser or the Company (as applicable) determines that there is no such rate, such other rate as the Independent Adviser or the
Company (as applicable) determines, each as in our own discretion acting in good faith, is most comparable to LIBOR.


 


“Beneficial
Owners” shall mean (a) if the Senior Debt Securities are in global form, the beneficial owners of the Senior Debt Securities
(and any interest therein) and (b) if the Senior Debt Securities are held in definitive form, the Holders in whose names the Senior
Debt Securities are registered in the Senior Debt Security Register and any beneficial owners holding an interest in such Senior
Debt Securities held in definitive form.


 


“business
day” means any day, other than Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions
are authorised or required by law or regulation to close in the City of New York or in the City of London.


 


“Calculation
Agent” shall mean National Westminster Bank Plc or its successor appointed by the Company, pursuant to a calculation
agent agreement expected to be entered into on June 25, 2018.


 


“Default”
has the meaning set forth in Section 5.03.


 


“Event
of Default” has the meaning set forth in Section 5.01.


 


“Fixed/Floating
Rate Notes Fixed Interest Rate” has the meaning set forth in Section 2.01 of the Second Supplemental Indenture.


 


“Fixed/Floating
Rate Notes Fixed Rate Period” has the meaning set forth in Section 2.01 of the Second Supplemental Indenture.


 


“Fixed/Floating
Rate Notes Fixed Rate Period Interest Payment Date” has the meaning set forth in Section 2.01 of the Second Supplemental
Indenture.


 




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“Fixed/Floating
Rate Notes Floating Rate Interest Period” means during the Fixed/Floating Rate Notes Floating Rate Period, the period
beginning on (and including) a Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date and ending on (but excluding)
the next succeeding Fixed/Floating Rate Notes Floating Rate Period Interest Payment Date; provided that the first floating
rate interest period will begin on June 25, 2023 and will end on (but exclude) the first Fixed/Floating Rate Notes Floating Rate
Period Interest Payment Date.


 


“Fixed/Floating
Rate Notes Floating Rate Period” has the meaning set forth in Section 2.01 of the Second Supplemental Indenture.


 


“Fixed/Floating
Rate Notes Floating Rate Period Interest Payment Date” has the meaning set forth in Section 2.01 of the Second Supplemental
Indenture.


 


“Fixed/Floating
Rate Notes Interest Payment Date” has the meaning set forth in Section 2.01 of the Second Supplemental Indenture.


 


“Fixed/Floating
Rate Notes Maturity Date” has the meaning set forth in Section 2.01 of the Second Supplemental Indenture.


 


“Floating
Rate Notes Interest Period” means the period beginning on (and including) a Floating Rate Notes Interest Payment Date
and ending on (but excluding) the next succeeding Floating Rate Notes Interest Payment Date; provided that the first
floating rate interest period will begin on June 25, 2018 and will end on (but exclude) the first Floating Rate Notes Interest
Payment Date.


 


“Floating
Rate Notes Interest Payment Date” has the meaning set forth in Section 2.02 of the Second Supplemental Indenture.


 


“Floating
Rate Notes Interest Rate” has the meaning set forth in Section 2.02 of the Second Supplemental Indenture.


 


“Floating
Rate Notes Maturity Date” has the meaning set forth in Section 2.02 of the Second Supplemental Indenture.


 




    15 


     


    

“Floating
Rate Interest Period” means a Fixed/Floating Rate Notes Floating Rate Interest Period or a Floating Rate Notes Interest
Period, as applicable.


 


“Independent
Adviser” means an independent financial institution of international repute or other independent financial adviser experienced
in the international capital markets, in each case appointed by the Company at its own expense.


 


“Interest
Determination Date” has the meaning set forth in Section 2.03 of the Second Supplemental Indenture.


 


“Interest
Payment Date” has the meaning set forth in Section 2.02 of the Second Supplemental Indenture.


 


“Interest
Reset Date” means either a Floating Rate Notes Interest Reset Date or a Fixed/Floating Rate Notes Interest Reset Date.


 


“Issue
Date” means June 25, 2018.


 


“LIBOR”
has the meaning set forth in Section 2.01 of the Second Supplemental Indenture.


 


“Loss
Absorption Disqualification Event” shall be deemed to have occurred if:


 


(i)  at
the time that any Loss Absorption Regulation becomes effective, and as a result of such Loss Absorption Regulation becoming so
effective, in each case with respect to the Company and/or the Regulatory Group, on or after the issue date of the series of Senior
Notes affected, the applicable Senior Notes of such series are or, in the Company’s opinion or in the opinion of the PRA
are likely to be fully or partially excluded from the Company’s and/or the Regulatory Group’s minimum requirements
for (A) own funds and eligible liabilities and/or (B) loss absorbing capacity instruments; or


 


(ii)  as
a result of any amendment to, or change in, any Loss Absorption Regulation, or any change in the application or official interpretation
of any Loss Absorption Regulation, in any such case becoming effective on or after the issue date of the series of Senior Notes
affected, the applicable Senior Notes of such series are or, in the Company’s opinion or in the opinion of the PRA are


 




    16 


     


    

likely to be, fully
or partially excluded from the Company’s and/or the Regulatory Group’s minimum requirements for (A) own funds and eligible
liabilities and/or (B) loss absorbing capacity instruments,


 


in each case as such
minimum requirements are applicable to the Company and/or the Regulatory Group and determined in accordance with, and pursuant
to, the relevant Loss Absorption Regulations; provided that in the case of (i) and (ii) above, a Loss Absorption Disqualification
Event shall not occur where the exclusion of the relevant series of Senior Notes from the relevant minimum requirement(s) is due
to the remaining maturity of the relevant series of Senior Notes being less than any period prescribed by any applicable eligibility
criteria for such minimum requirements under the relevant Loss Absorption Regulations effective with respect to the Company and/or
the Regulatory Group on the issue date of the relevant series of Senior Notes.


 


“Loss
Absorption Regulations” means, at any time, the laws, regulations, requirements, guidelines, rules, standards and policies
relating to minimum requirements for own funds and eligible liabilities and/or loss absorbing capacity instruments of the United
Kingdom, the PRA, the United Kingdom resolution authority, the Financial Stability Board and/or of the European Parliament or of
the Council of the European Union then in effect in the United Kingdom including, without limitation to the generality of the foregoing,
any delegated or implementing acts (such as regulatory technical standards) adopted by the European Commission and any regulations,
requirements, guidelines, rules, standards and policies relating to minimum requirements for own funds and eligible liabilities
and/or loss absorbing capacity instruments adopted by the PRA (whether or not such regulations, requirements, guidelines, rules,
standards or policies are applied generally or specifically to the Company or to the Regulatory Group).


 


“Maturity
Date” means the Fixed/Floating Rate Notes Maturity Date or the Floating Rate Notes Maturity Date, as applicable.


 


“PRA”
means the UK Prudential Regulation Authority and/or such other governmental authority in the United Kingdom


 




    17 


     


    

having primary supervisory
authority with respect to the Company’s business.


 


“Regulatory
Group” means the Company, the Company’s subsidiary undertakings, participations, participating interests and any
subsidiary undertakings, participations or participating interests held (directly or indirectly) by any of the Company’s
subsidiary undertakings from time to time and any other undertakings from time to time consolidated with the Company for regulatory
purposes, in each case in accordance with the rules and guidance of the PRA then in effect.


 


“Relevant
Nominating Body” means, in respect of a reference rate for any series:


 


(i)  the
central bank, reserve bank, monetary authority or any similar institution for the currency to which such reference rate relates,
or any other central bank or other supervisory authority which is responsible for supervising the administrator of such reference
rate; or


 


(ii)  any
working group or committee sponsored by, chaired or co-chaired by or constituted at the request of (a) the central bank, reserve
bank, monetary authority or any similar institution for the currency to which such reference rate relates, (b) any central bank
or other supervisory authority which is responsible for supervising the administrator of such reference rate, (c) a group of the
aforementioned central banks or other supervisory authorities, (d) the International Swaps and Derivatives Association, Inc. or
any part thereof, or (e) the Financial Stability Board or any part thereof.


 


“Reuters
Page LIBOR01” means the display that appears on Reuters Page LIBOR01 or any page as may replace such page on such service
(or any successor service) for the purpose of displaying LIBOR of major banks for U.S. dollars.


 


“Second
Supplemental Indenture” means this second supplemental indenture under the Amended and Restated Indenture, dated as of
June 25, 2018, among the Company and the Trustee.


 


“Senior
Creditors” means creditors of the Company whose claims are admitted to proof in the winding up, liquidation,


 




    18 


     


    

administration or
other insolvency procedure of the Company and who are unsubordinated creditors of the Company.


 


“Senior
Notes” has the meaning set forth in the recitals to the Second Supplemental Indenture.


 


“Successor
Rate” means, in respect of each series, the reference rate (and related alternative screen page or source, if available)
that the Independent Adviser or the Company (as applicable) determines is a successor to or replacement of LIBOR which is recommended
by any Relevant Nominating Body.


 


Section 3.02.Satisfaction and Discharge.
With respect to the Senior Notes only, Section 4.01 of the Base Indenture is amended and restated in its entirety and shall read
as follows:


 


Section 4.01.Satisfaction
and Discharge of Amended and Restated Indenture. This Amended and Restated Indenture shall upon Company Request cease to be
of further effect with respect to Senior Debt Securities of any series (except as to any surviving rights of registration of transfer
or exchange of Senior Debt Securities of such series herein expressly provided for), and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of this Amended and Restated Indenture with respect to
Senior Debt Securities of such series when:


 


		(a)	all Senior Debt Securities of such series theretofore
authenticated and delivered (other than (A) Senior Debt Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 3.06 and (B) Senior Debt Securities for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as
provided in Section 10.03) have been delivered to the Trustee for cancellation;



 


		(b)	the Company has paid or caused to be paid all other
sums payable hereunder by the Company with respect to the Senior Debt Securities of such series; and



 


		(c)	the Company has delivered to the Trustee an Officer’s
Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction
and discharge of this Amended and Restated Indenture with respect to the Senior Debt Securities of such series have been complied
with.



 




    19 


     


    

Notwithstanding any satisfaction
and discharge of this Amended and Restated Indenture, the obligations of the Company to the Trustee under Section 6.07, the obligations
of the Trustee to any Authenticating Agent under Section 6.14 and the last paragraph of Section 10.03, shall survive such satisfaction
and discharge, including any termination under any bankruptcy law.


 


Section 3.03.Events of Default.
With respect to the Senior Notes only, Section 5.01 of the Base Indenture is amended and restated in its entirety and shall read
as follows:


 


Section 5.01.Events of
Default. “Event of Default”, wherever used herein with respect to Senior Debt Securities of a particular
series, means the making of an order by a court of competent jurisdiction which is not successfully appealed within 30 days of
the making of such order, or valid adoption by the shareholders of the Company of an effective resolution, for the winding-up of
the Company (other than under or in connection with a scheme of amalgamation or reconstruction not involving a bankruptcy or insolvency).
The exercise of any U.K. bail-in power by the relevant U.K. resolution authority shall not constitute a default or an Event of
Default under this Section 5.01 or a Default under Section 5.03.


 


Section 3.04.Acceleration of Maturity;
Rescission and Annulment. With respect to the Senior Notes only, Section 5.02 of the Base Indenture is amended by adding the
following at the end of the section:


 


If the Senior Debt Securities
become due and payable and the Company fails to pay such amounts (or any damages awarded for breach of any obligations in respect
of the Senior Debt Securities or this Amended and Restated Indenture) forthwith upon demand, notwithstanding the continuing right
of any Holder to receive payment of the principal of and interest on the Senior Debt Securities, or to institute suit for the enforcement
of any such payment, each as provided for under Section 316(b) (Directions and Waivers by Bondholders; Prohibition of Impairment
of Holders’ Right to Repayment) of the Trust Indenture Act, the Trustee, in its own name and as trustee of an express
trust, may institute proceedings for the winding up of the Company, and/or prove in a winding up of the Company for all such due
and payable amounts (including any damages awarded for breach of any obligations in respect of the Senior Debt Securities or this
Amended and Restated Indenture) but no other remedy shall be available to the Trustee or the Holders.


 




    20 


     


    

Section 3.05.Defaults; Collection
of Indebtedness and Suits for Enforcement by Trustee. With respect to the Senior Notes only, Section 5.03 of the Base Indenture
is amended and restated in its entirety and shall read as follows:


 


Section 5.03.Defaults;
Collection of Indebtedness and Suits for Enforcement by Trustee. “Default” wherever used herein with respect
to Senior Debt Securities of a particular series, means any one of the following events (subject as provided below, whatever the
reason for such Default and whether it shall be voluntary or involuntary or be effected by operation of law pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any administrative or governmental body):


 


		(a)	the Company fails to pay any installment of interest
in respect of the Senior Debt Securities of such series on or before the relevant Interest Payment Date and such failure continues
for 14 days; or



 


		(b)	the Company fails to pay all or any part of the principal
amount of the Senior Debt Securities of such series when it otherwise becomes due and payable, whether upon redemption or otherwise,
and such failure continues for 7 days.



 


If a Default occurs and is continuing,
the Trustee may commence a proceeding for the winding up of the Company, provided that the Trustee may not declare the principal
amount of any Outstanding Senior Debt Securities of any series to be due and payable.


 


Subject to applicable law, the Trustee
(acting on behalf of the Holders) and the Holders of the Senior Debt Securities by their acceptance thereof will be deemed to have
waived to the fullest extent permitted by law any right of set-off, counterclaim or combination of accounts with respect to the
Senior Debt Securities, the Second Supplemental Indenture or this Amended and Restated Indenture (or between the Company’s
obligations under or in respect of any Senior Debt Security and any liability owed by a Holder to the Company) that they (or the
Trustee acting on their behalf) might otherwise have against the Company, whether before or during any winding-up, liquidation
or administration of the Company. Notwithstanding the above, if any of such rights and claims of any such Holder (or the Trustee
acting on behalf of such Holders) against the Company are discharged by set-off, such Holder (or the Trustee acting on behalf of
such Holders) will immediately pay an amount equal to the amount of such discharge to the Company or, in the event of any winding-up,
liquidation or administration of the Company, the liquidator or administrator (or other relevant insolvency official), as the case
may be, to be held on trust for the Senior Creditors and until such time as payment is


 




    21 


     


    

made will hold a sum equal to such
amount on trust for the Senior Creditors and accordingly such discharge shall be deemed not to have taken place.


 


Notwithstanding the foregoing and
any other provisions, a failure to make any payment on the Senior Debt Securities of any series shall not be a Default if it is
withheld or refused, upon independent counsel’s advice delivered to the Trustee, in order to comply with any applicable fiscal
or other law or regulation or order of any court of competent jurisdiction, provided, however, that the Trustee may require the
Company to take any action which, upon independent counsel’s advice delivered to the Trustee, is appropriate and reasonable
in the circumstances (including proceedings for a court declaration), in which case the Company shall immediately take and expeditiously
proceed with the action and shall be bound by any final resolution resulting therefrom. If any such action results in a determination
that the relevant payment can be made without violating any applicable law, regulation or order then the payment shall become due
and payable on the expiration of the applicable 14-day or seven-day period after the Trustee gives written notice to the Company
informing it of such determination.


 


Upon the occurrence of any Event
of Default or Default, the Company shall give prompt written notice to the Trustee. Except as otherwise provided in this Article
5, the Trustee may proceed to protect and enforce its rights and the rights of the Holders of the Senior Debt Securities whether
in connection with any breach by the Company of its obligations under the Senior Debt Securities, this Amended and Restated Indenture
or otherwise, including by judicial proceedings, provided that the Company shall not, as a result of any such action by the Trustee,
be required to pay any amount representing or measured by reference to principal or interest on the Senior Debt Securities of any
series prior to any date on which the principal of, or any interest on, the Senior Debt Securities of any such series would have
otherwise been payable.


 


No recourse for the payment of the
principal of (or premium, if any) or interest, if any, on any Senior Debt Security, or for any claim based thereon and no recourse
under or upon any obligation, covenant or agreement of the Company in this Amended and Restated Indenture, or in any Senior Debt
Security, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder,
officer or director, past, present or future, of the Company or of any successor corporation of the Company, either directly or
through the Company or any successor corporation whether by virtue of any


 




    22 


     


    

constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that to the extent lawful all
such liability is hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Amended
and Restated Indenture and the issue of the Senior Debt Securities.


 


No remedy against the Company, other
than as referred to in Article 5 of this Amended and Restated Indenture, shall be available to the Trustee or the Holders of the
Senior Debt Securities whether for the recovery of amounts owing in respect of such Senior Debt Securities or under this Amended
and Restated Indenture or in respect of any breach by the Company of its obligations under this Amended and Restated Indenture
or in respect of the Senior Debt Securities, except that the Trustee and the Holders shall have such rights and powers as they
are entitled to have under the Trust Indenture Act, including the Trustee’s prior lien on any amounts collected following
a Default or Event of Default for payment of the Trustee’s fees and expenses, and provided that any payments on the Senior
Debt Securities are subject to the subordination provisions set forth in this Amended and Restated Indenture.


 


Notwithstanding any contrary provisions,
nothing shall impair the right of a Holder, absent the Holder’s consent, to sue for any payments due but unpaid with respect
to the Senior Debt Securities.


 


Section 3.06.With respect to the Senior
Notes only, Sections 5.07(a), 5.07(b), 5.11, 5.13, 6.02, 6.03(i), 8.03(c) of the Base Indenture shall be amended to add the words
“or Default” after each appearance of the words “Event of Default”.


 


Section 3.07.Optional Redemption
Due to Changes in Tax Treatment. With respect to the Senior Notes only, Section 11.08 of the Base Indenture is amended to replace
in the first paragraph (i) the word “Unless” with the words “Subject to Sections 11.04 and 11.11 and unless”
and (ii) the words “on any Interest Payment Date,” with “(i) in respect of the Fixed/Floating Rate Notes, at
any time during the Fixed/Floating Rate Notes Fixed Rate Period and thereafter only on a Fixed/Floating Rate Notes Floating Rate
Period Interest Payment Date and (ii) in respect of the Floating Rate Notes, only on a Floating Rate Notes Interest Payment Date,
in each case”.


 


Section 3.08.Redemption of Senior
Debt Securities. With respect to the Senior Notes only, Article 11 of the Base Indenture is amended to amend and restate Section
11.04 and to add a Section 11.09, Section 11.10 and Section 11.11, each of which shall read as follows:


 




    23 


     


    

Section 11.04. Notice of
Redemption. Unless otherwise provided as contemplated by Section 3.01 with respect to any series of Senior Debt Securities,
notice of redemption shall be given (i) not less than 5 business days nor more than 60 calendar days prior to the Redemption Date
to each Holder of Senior Debt Securities to be redeemed and (ii) to Trustee at least 5 business days prior to such date, unless
a shorter notice period shall be satisfactory to the Trustee in the manner and to the extent provided in Section 1.06.


 


Any redemption notice will state:


 


		a)	the Redemption Date;



 


		b)	the Redemption Price;



 


		c)	that, and subject to what conditions, the Redemption
Price will become due and payable on the Redemption Date and that payments will cease to accrue on such date;



 


		d)	the place or places at which each Holder may obtain payment
of the Redemption Price; and



 


		e)	the CUSIP, Common Code and/or ISIN number or numbers,
if any, with respect to such series of Senior Debt Securities.



 


Notice of redemption of Senior
Debt Securities to be redeemed at the selection of the Company shall be given by the Company or, at the Company’s Request,
by the Trustee in the name and at the expense of the Company.


 


Section 11.09.Optional
Redemption. Subject to Section 11.11, the Company may, at the Company’s option and in its sole discretion, redeem Senior
Debt Securities of any series, in whole but not in part, on June 25, 2023, at a Redemption Price equal to 100% of the principal
amount of the Senior Debt Securities of any series together with any accrued but unpaid interest to, but excluding, the Redemption
Date.


 


Section 11.10. Loss Absorption
Disqualification Event Redemption. Subject to Sections 11.04 and 11.11, the Company may, at the Company’s option and
in its sole discretion, redeem Senior Debt Securities of any series, in whole but not in part, (i) in respect of the Fixed/Floating
Rate Notes, at any time during the Fixed/Floating Rate Notes Fixed Rate Period and thereafter only on a Fixed/Floating Rate Notes
Floating Rate Period Interest Payment Date and (ii) in respect of the Floating Rate Notes, only


 




    24 


     


    

on a Floating Rate Notes Interest
Payment Date, in each case, at a Redemption Price equal to 100% of the principal amount of the Senior Debt Securities of any series
together with any accrued but unpaid interest to, but excluding, the Redemption Date, if the Company determines that a Loss Absorption
Disqualification Event has occurred and is continuing.


 


Before the publication of any notice
of redemption pursuant to a Loss Absorption Disqualification Event, the Company shall deliver to the Trustee a certificate signed
by two authorised signatories of the Company stating that, in such signatories’ belief, the condition for redemption has
occurred and is continuing as at the date of the certificate, and the Trustee is entitled to conclusively rely on and shall accept
such certificate as sufficient evidence of such occurrence, in which event it shall be conclusive and binding on the Holders.


 


Section 11.11. Conditions
to Redemption and Repurchase. Notwithstanding any other provision, the Company may only redeem Senior Debt Securities of any
series prior to their Maturity Date (as provided for in Section 11.08, Section 11.09 and Section 11.10) or repurchase Senior Debt
Securities of any series (and give notice thereof to the Holders of such series of Senior Debt Securities in the case of redemption)
if the Company has obtained the prior consent of the PRA, to the extent such consent is at the relevant time and in the relevant
circumstances required (if at all) by the Loss Absorption Regulations or applicable laws or regulations in effect in the United
Kingdom.


 


Article
4

MISCELLANEOUS


 


Section 4.01.Effect of Supplemental
Indenture. Upon the execution and delivery of this Second Supplemental Indenture by the Company and the Trustee, and the delivery
of the documents referred to in ‎Section 4.02 herein, the Base Indenture shall be amended and supplemented in accordance herewith,
and this Second Supplemental Indenture shall form a part of the Base Indenture for all purposes in respect of the Senior Notes.


 


Section 4.02.Other Documents to
Be Given to the Trustee. As specified in Section 9.03 of the Base Indenture and subject to the provisions of Section 6.03 of
the Base Indenture, the Trustee shall be entitled to receive an Officer’s Certificate and an Opinion of Counsel stating the
recitals contained in Section 1.02 of the Base Indenture, and in the case of such Opinion of Counsel, that this Second Supplemental
Indenture is authorized or permitted by the Base Indenture, conforms to the requirements of the Trust Indenture Act, and (subject
to Section


 




    25 


     


    

1.03 of the Base Indenture) constitutes valid
and binding obligations of the Company enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency
and similar laws affecting creditors’ rights generally, concepts of reasonableness and equitable principles of general applicability
and may be subject to possible judicial or regulatory actions giving effect to governmental actions or foreign laws affecting creditors’
rights, as conclusive evidence that this Second Supplemental Indenture complies with the applicable provisions of the Base Indenture.


 


Section 4.03.Confirmation of Indenture.
The Base Indenture and this Second Supplemental Indenture with respect to the Senior Notes, is in all respects ratified and confirmed,
including without limitation Section 6.07 and Article 12 of the Base Indenture, and the Base Indenture, this Second Supplemental
Indenture and all indentures supplemental thereto shall, in respect of the Senior Notes, be read, taken and construed as one and
the same instrument. This Second Supplemental Indenture constitutes an integral part of the Base Indenture with respect to the
Senior Notes. In the event of a conflict between the terms and conditions of the Base Indenture and the terms and conditions of
this Second Supplemental Indenture, the terms and conditions of this Second Supplemental Indenture shall prevail with respect to
the Senior Notes.


 


Section 4.04.Concerning the Trustee.
The Trustee does not make any representations as to the validity or sufficiency of this Second Supplemental Indenture. The recitals
and statements herein are deemed to be those of the Company and not the Trustee. In entering into this Second Supplemental Indenture,
the Trustee shall be entitled to the benefit of every provision of the Base Indenture relating to the conduct of or affecting the
liability of or affording protection to the Trustee.


 


Section 4.05.Governing Law.
This Second Supplemental Indenture and the Senior Notes shall be governed by and construed in accordance with the laws of the State
of New York, irrespective of conflicts of laws principles, except as stated in Section 1.12 of the Base Indenture, and except that
the authorization and execution by the Company of this Second Supplemental Indenture and the Senior Notes shall be governed by
(in addition to the laws of the State of New York relevant to execution) the respective jurisdictions of the Company and the Trustee,
as the case may be.


 


Section 4.06.Reparability.
In case any provision contained in this Second Supplemental Indenture shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.


 




    26 


     


    

Section 4.07.Counterparts.
This Second Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.


 


[Signature Page Follows]


 




    27 


     


    

IN WITNESS WHEREOF, the parties hereto
have caused this Second Supplemental Indenture to be duly executed as of the date first written above.


 


	 	THE ROYAL BANK OF SCOTLAND

                    GROUP PLC, as the Company

	 	 
	 	 
	 	By:	/s/ Justin Fox	 
	 	 	Name:	/s/ Justin Fox	 
	 	 	Title: 	Head of Capital Management	 
	 	 	 	 	 
	 	 	 	 	 


	 	THE BANK OF NEW YORK MELLON,

                    LONDON BRANCH, as Trustee

	 	 
	 	 
	 	By:	/s/ Marilyn Chau	 
	 	 	Name: 	/s/ Marilyn Chau	 
	 	 	Title: 	Vice President	 


 


 


[Signature Page to Second Supplemental
Indenture]


 




     


     


    

EXHIBIT A


 


FORM OF FIXED/FLOATING RATE NOTES


 


THIS SECURITY IS A GLOBAL SECURITY WITHIN
THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY
MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE.


 


CUSIP No. 780097 BJ9


ISIN No. US780097BJ90


 


THE ROYAL BANK OF SCOTLAND GROUP plc


 


4.519%
Fixed rate/floating rate Notes due 2024

(“SENIOR NOTES”)


 


	No. [●]	$[●]


 


THE ROYAL BANK OF SCOTLAND GROUP plc (herein
called the “Company,” which term includes any successor person under the Indenture (as defined on the reverse
hereof)), for value received, hereby promises to pay to CEDE & CO., or registered assignees, the principal sum of $[●]
([●] million dollars) on June 25, 2024 (the “Maturity Date”), or on such earlier date as the principal
hereof may become due in accordance with the terms hereof and to pay interest thereon:


 


(1) from (and including) June 25, 2018 (the
“Issue Date”), to (but excluding) June 25, 2023 (such period, the “Fixed Rate Period”), semi-annually
in arrear on June 25 and December 25 of each year, beginning on December 25, 2018, to (and including) June 25, 2023 (each, a “Fixed
Rate Period Interest Payment Date”), at a rate of 4.519% per annum (the “Fixed Interest Rate”); and


 


(2) from (and including) June 25, 2023 to
(but excluding) the Maturity Date (such period, the “Floating Rate Period”), quarterly in arrear on September
25, 2023, December 25, 2023, March 25, 2024 and June 25, 2024, beginning on September 25,


 




    
(Face of Security continued on next page)


     


    

2023, to (and including) the Maturity Date (each, a “Floating
Rate Period Interest Payment Date” and, together with each Fixed Rate Period Interest Payment Date, each an “Interest
Payment Date”), equal to the three-month U.S. dollar London interbank offered rate (“LIBOR”), as determined
by the Calculation Agent on the applicable Interest Determination Date, plus 1.550% per annum, accruing from June 25, 2023, to
(but excluding) the Maturity Date and which interest rate will be reset quarterly on June 25, 2023, September 25, 2023, December
25, 2023 and March 25, 2024, beginning on June 25, 2023 (each an “Interest Reset Date”).


 


“Interest Determination Date”
means the second London banking day preceding each applicable Interest Reset Date.


 


“London banking day”
means any day on which dealings in U.S. dollars are transacted in the London interbank market.


 


Subject to the provisions below, LIBOR shall
be determined by the Calculation Agent in accordance with the following provisions:


 


		i.	With respect to any Interest Determination Date, LIBOR will be the rate (expressed as a percentage per annum) for deposits
in U.S. dollars having a maturity of three months commencing on the related Interest Reset Date that appears on Reuters Page LIBOR01
as of 11:00 a.m., London time, on that Interest Determination Date. If no such rate appears, then LIBOR, in respect of that Interest
Determination Date, will be determined in accordance with the provisions described in (ii) below.



 


		ii.	With respect to an Interest Determination Date on which no rate appears on Reuters Page LIBOR01 (as defined below), the calculation
agent will request the principal London offices of each of four major reference banks in the London interbank market, as selected
and identified by the Company, to provide its offered quotation (expressed as a percentage per annum) for deposits in U.S. dollars
for the period of three months, commencing on the related Interest Reset Date, to prime banks in the London interbank market at
approximately 11:00 a.m., London time, on that Interest Determination Date and in a principal amount that is representative for
a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, then LIBOR on that Interest
Determination Date will be the arithmetic mean of those quotations. If fewer than two quotations are provided, then LIBOR on the
Interest Determination Date will be the arithmetic mean of the rates quoted at approximately 11:00 a.m., in the City of New York,
on the Interest Determination Date by three major banks in the City of New York, as selected and identified by the Company, for
loans in U.S. dollars to leading European banks, for a period of three months, commencing on the related Interest Reset



 




    
(Face of Security continued on next page)


     


    

Date, and in a principal amount
that is representative for a single transaction in U.S. dollars in that market at that time. If at least two such rates are so
provided, LIBOR on the Interest Determination Date will be the arithmetic mean of such rates. If fewer than two such rates are
so provided, LIBOR on the Interest Determination Date will be LIBOR in effect with respect to the immediately preceding Interest
Determination Date or, in the case of the initial Interest Determination Date, such rate as may be determined by such alternate
method as reasonably selected by the Calculation Agent.


 


“Reuters Page LIBOR01”
means the display that appears on Reuters Page LIBOR01 or any page as may replace such page on such service (or any successor service)
for the purpose of displaying LIBOR of major banks for U.S. dollars.


 


All percentages resulting from any calculation
of any interest rate on this Senior Note will be rounded, if necessary, to the nearest one hundred thousandth of a percentage point,
with five one-millionths of a percentage point rounded upward, and all dollar amounts would be rounded to the nearest cent, with
one-half cent being rounded upward.


 


Notwithstanding the provisions relating
to the determination of LIBOR described above, if the Company (in consultation with the Calculation Agent to the extent practicable)
determines that LIBOR has ceased to be published on Reuters Page LIBOR01 as a result of LIBOR ceasing to be calculated or administered,
then the following provisions will apply:


 


		(1)	the Company will use reasonable endeavors to appoint
an Independent Adviser to determine a Successor Rate or, alternatively, if the Independent Adviser determines that there is no
Successor Rate, an Alternative Reference Rate, no later than 5 business days prior to an Interest Determination Date (the “IA
Determination Cut-off Date”), for purposes of determining the rate of interest for the Floating Rate Interest Period;



 


		(2)	if the Company is unable to appoint an Independent
Adviser, or the Independent Adviser appointed by the Company fails to determine a Successor Rate or an Alternative Reference Rate
prior to the IA Determination Cut-off Date, then the Company (in consultation with the Calculation Agent to the extent practicable
and acting in good faith) may determine a Successor Rate, or if the Company determines that there is no Successor Rate, an Alternative
Reference Rate, for purposes of determining the rate of interest for a Floating Rate Interest Period; provided, however,
that if the Company is unable or unwilling to determine a Successor Rate or an Alternative Reference Rate prior to an Interest
Determination Date in accordance with this sub-paragraph (2), the rate of interest will be equal to the rate of interest in effect
with respect to the immediately preceding Interest



 




    
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Determination Date, or, in the case of the initial
Interest Determination Date, the rate of interest will be equal to the Fixed Interest Rate.


 


If a Successor Rate or Alternative Reference
Rate is determined in accordance with the preceding provisions, such Successor Rate or Alternative Reference Rate shall be substituted
for LIBOR for all future Floating Rate Interest Periods.


 


If the Independent Adviser (in consultation
with the Company) or the Company, as applicable, determines that an Adjustment Spread is required to be applied to the Successor
Rate or the Alternative Reference Rate, as applicable, and determines the quantum of, or a formula or methodology for determining,
such Adjustment Spread, then such Adjustment Spread shall be applied to the Successor Rate or the Alternative Reference Rate, as
applicable. If the Independent Adviser is, or the Company is, as the case may be, unable to determine the quantum of, or a formula
or methodology for determining, such Adjustment Spread, then such Successor Rate or Alternative Reference Rate, as applicable,
will apply without an Adjustment Spread.


 


If the Independent Adviser or the Company,
as the case may be, determines a Successor Rate or Alternative Reference Rate or, in each case, any Adjustment Spread, in accordance
with the above provisions, the Independent Adviser or the Company may also, following consultation with the Calculation Agent to
the extent practicable, specify changes to the Successor Rate or Alternative Reference Rate, as applicable, or, in each case, the
Adjustment Spread, as well as the day count fraction, business day convention, the definition of business day, the Interest Determination
Date or the Floating Rate Period Interest Payment Date, and related provisions and definitions. All such changes can be made in
order to follow market practice in relation to the Successor Rate or Alternative Reference Rate and such changes shall apply for
all future Floating Rate Interest Periods. Upon receipt of satisfactory documentation, the Trustee shall, at our direction and
expense, effect such amendments as may be required in order to give effect to this provision pursuant to a supplemental indenture
or an amendment to the Indenture, or issuances and authentication of new global or definitive notes in respect of this Senior Notes,
and the Trustee shall not be liable to any party for any consequences thereof, save as provided in the Indenture and this Senior
Note. No Holder consent will be solicited or required in connection with effecting the Successor Rate or Alternative Reference
Rate or related changes, including for the execution of any documents, amendments to the Indenture or this Senior Note or other
steps by the Company, the Trustee, the Calculation Agent or the principal paying agent (if required). The Company will, promptly
following the determination of any Successor Rate, Alternative Reference Rate or Adjustment Spread, give notice thereof and of
any changes to the terms of this Senior Note to the Trustee, the Calculation Agent, the principal paying agent and the Holders,
in accordance with Section 1.05 and Section 1.06 of the Base Indenture. By its acquisition of this Senior Note, each Holder and
Beneficial Owner of this Senior Note and each subsequent Holder and Beneficial Owner acknowledges, accepts, agrees to be bound
by, and consents to, the Independent Adviser or the Company’s, as applicable, determination of the Successor Rate, Alternative
Reference Rate or Adjustment Spread, as applicable, any changes in


 




    
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connection therewith as contemplated by this provision, and
to any amendment or alteration of the terms of the Senior Note, including an amendment of the amount of interest due on the Senior
Note, as may be required in order to give effect to this provision. The Trustee shall be entitled to rely on this deemed consent
in connection with any supplemental indenture or amendment which may be necessary to effect the Successor Rate or Alternative Reference
Rate.


 


By its acquisition of this Senior Note,
each Holder of this Senior Note waives any and all claims against the Trustee, the Calculation Agent and the principal paying agent
for, agrees not to initiate a suit against the Trustee, the Calculation Agent and the principal paying agent in respect of, and
agrees that neither the Trustee, the Calculation Agent or the principal paying agent will be liable for, any action that the Trustee,
the Calculation Agent or the paying agent, as the case may be, takes, or abstains from taking, in each case in accordance with
this provision. By its acquisition of this Senior Note, each Holder of this Senior Note agrees that neither the Trustee, the Calculation
Agent or the principal paying agent will have any obligation to determine any Successor Rate, Alternative Reference Rate or Adjustment
Spread (including any adjustments thereto), including in the event of any failure by us to determine any Successor Rate, Alternative
Reference Rate or Adjustment Spread.


 


An Independent Adviser appointed pursuant
to the above provisions shall act in good faith and (in the absence of bad faith, gross negligence or willful misconduct) shall
have no liability whatsoever to the Company, the Trustee, the Calculation Agent or any Holder or Beneficial Owner for any determination
made by it or for any advice given to the Company in connection with any determination made by the Company, pursuant to the above
provisions.


 


No Successor Rate or Alternative Reference
Rate will be adopted pursuant to the above provisions, nor will any other amendment to the terms of this Senior Note be made, if
and to the extent that, in the Company’s determination, the same could reasonably be expected to prejudice the qualification
of this Senior Note as the Company’s and/or the Regulatory Group’s minimum requirements for (A) own funds and eligible
liabilities and/or (B) loss absorbing capacity instruments.


 


“Adjustment Spread”
means a spread (which may be positive or negative) or formula or methodology for calculating a spread, which the Independent Adviser
(in consultation with the Company) or the Company, as applicable, determines is required to be applied to the Successor Rate or
the Alternative Reference Rate, as applicable, as a result of the replacement of LIBOR with the Successor Rate or the Alternative
Reference Rate, as applicable, and is the spread, formula or methodology which:


 


		(i)	in the case of a Successor Rate, is recommended in relation to the replacement of LIBOR with the Successor Rate by any Relevant
Nominating Body; or



 




    
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		(ii)	in the case of a Successor Rate for which no such recommendation has been made or in the case of an Alternative Reference Rate,
the Independent Adviser (in consultation with the Company) or the Company, as applicable, determines is recognized or acknowledged
as being in customary market usage for the purposes of determining floating rates of interest in respect of securities denominated
in U.S. dollars, where such rate has been replaced by the Successor Rate or the Alternative Reference Rate, as applicable; or



 


		(iii)	if no such customary market usage is recognized or acknowledged, the Independent Adviser in its discretion (in consultation
with the Company), or the Company in its discretion, as applicable, determines (acting in good faith) to be appropriate.



 


“Alternative Reference Rate”
means the reference rate (and related alternative screen page or source, if available) that the Independent Adviser or the Company
(as applicable) determines has replaced LIBOR in customary market usage for the purposes of determining floating rates of interest
in respect of securities denominated in U.S. dollars, or, if the Independent Adviser or the Company (as applicable) determines
that there is no such rate, such other rate as the Independent Adviser or the Company (as applicable) determines, each as in our
own discretion acting in good faith, is most comparable to LIBOR.


 


“Floating Rate Interest Period”
means during the Floating Rate Period, the period beginning on (and including) a Floating Rate Period Interest Payment Date and
ending on (but excluding) the next succeeding Floating Rate Period Interest Payment Date; provided that the first floating
rate interest period will begin on June 25, 2023 and will end on (but exclude) the first Floating Rate Period Interest Payment
Date.


 


“Independent Adviser”
means an independent financial institution of international repute or other independent financial adviser experienced in the international
capital markets, in each case appointed by the Company at its own expense.


 


“Relevant Nominating
Body” means, in respect of a reference rate:


 


		(i)	the central bank, reserve bank, monetary authority
or any similar institution for the currency to which such reference rate relates, or any other central bank or other supervisory
authority which is responsible for supervising the administrator of such reference rate; or



 


		(ii)	any working group or committee sponsored by, chaired
or co-chaired by or constituted at the request of (a) the central bank, reserve bank, monetary



 




    
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authority
or any similar institution for the currency to which such reference rate relates, (b) any central bank or other supervisory authority
which is responsible for supervising the administrator of such reference rate, (c) a group of the aforementioned central banks
or other supervisory authorities, (d) the International Swaps and Derivatives Association, Inc. or any part thereof, or (e) the
Financial Stability Board or any part thereof.


 


“Successor Rate” means
the reference rate (and related alternative screen page or source, if available) that the Independent Adviser or the Company (as
applicable) determines is a successor to or replacement of LIBOR which is recommended by any Relevant Nominating Body.


 


During the Fixed Rate Period:


 


(i)  Interest
will be calculated on the basis of twelve 30-day months or, in the case of an incomplete month, the actual number of days elapsed,
in each case assuming a 360-day year; and


 


(ii)  If
any scheduled interest payment date is not a business day, such interest payment date will be postponed to the next day that is
a business day, but interest on that payment will not accrue during the period from and after the scheduled interest payment date.


 


During the Floating Rate Period:


 


(i)  Interest
will be calculated on the basis of the actual number of days in each interest period, assuming a 360-day year. An interest period
will be the period beginning on (and including) a Floating Rate Period Interest Payment Date and ending on (but excluding) the
next succeeding Floating Rate Period Interest Payment Date; provided that the first floating rate interest period will
begin on June 25, 2023 and will end on (but exclude) the first Floating Rate Period Interest Payment Date.


 


(ii)  If
any scheduled Interest Reset Date or Floating Rate Period Interest Payment Date (other than the Maturity Date) is not a business
day, such Interest Reset Date or Floating Rate Period Interest Payment Date will be postponed to the next day that is a business
day; provided that if that business day falls in the next succeeding calendar month, such Interest Reset Date or Floating
Rate Period Interest Payment Date will be the immediately preceding business day. If any such Floating Rate Period Interest Payment
Date (other than the Maturity Date) is postponed or brought forward as described above, the payment of interest due on such postponed
or brought forward Floating Rate Period


 




    
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Interest Payment Date will include
interest accrued to but excluding such postponed or brought forward Floating Rate Period Interest Payment Date.


 


The regular record dates for this Senior
Note will be the 15th calendar day preceding each Interest Payment Date, whether or not a business day.


 


If (i) the Company fails to pay any installment
of interest in respect of this Senior Note on or before the relevant Interest Payment Date and such failure continues for 14 days,
or (ii) the Company fails to pay all or any part of the principal amount of this Senior Note when it otherwise becomes due and
payable, whether upon redemption or otherwise, and such failure continues for 7 days (each of (i) and (ii), a “Default”),
the Trustee may commence a proceeding for the winding up of the Company, provided that the Trustee may not declare the principal
amount of any Outstanding Senior Notes to be due and payable.


 


Payment of the principal amount of, and
any interest on, this Senior Note will be made in such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts. Such payment shall be made to the Holder including through a Paying Agent
of the Company outside the United Kingdom for collection by the Holder.


 


Prior to due presentment of this Senior
Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Senior Note is registered as the owner of such Senior Note for the purpose of receiving payment of principal and
interest, if any, on such Senior Note and for all other purposes whatsoever, whether or not such Senior Note be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.


 


Reference is hereby made to the further
provisions of this Senior Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect
as if set forth at this place.


 


Unless the certificate of authentication
hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Senior Note shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose.


 


Notwithstanding any other term of any Senior
Notes, the Indenture, or any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial
Owner, by its acquisition of this Senior Note, each Holder (including each Beneficial Owner) of this Senior Note acknowledges,
accepts, agrees to be bound by and consents to the exercise of any U.K. bail-in power by the relevant U.K. resolution


 




    
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authority that may result in (i) the reduction or cancellation
of all, or a portion, of the principal amount of, or interest on, this Senior Note; (ii) the conversion of all, or a portion, of
the principal amount of, or interest on, this Senior Note into ordinary shares or other securities or other obligations of the
Company or another person; and (iii) the amendment or alteration of the maturity of this Senior Note, or amendment of the amount
of interest due on this Senior Note, or the dates on which interest becomes payable, including by suspending payment for a temporary
period; which U.K. bail-in power may be exercised by means of variation of the terms of this Senior Note solely to give effect
to the exercise by the relevant U.K. resolution authority of such U.K. bail-in power. Each Holder (including each Beneficial Owner)
of this Senior Note further acknowledges and agrees that the rights of the Holders and/or Beneficial Owners under this Senior Note
are subject to, and will be varied, if necessary, solely to give effect to, the exercise of any U.K. bail-in power by the relevant
U.K. resolution authority.


 


For these purposes, “U.K. bail-in
power” means any write-down, conversion, transfer, modification or suspension power existing from time to time under
any laws, regulations, rules or requirements relating to the resolution of banks, banking group companies, credit institutions
and/or investment firms incorporated in the United Kingdom in effect and applicable in the United Kingdom to the Company or other
members of the Group, including but not limited to any such laws, regulations, rules or requirements which are implemented, adopted
or enacted within the context of a European Union directive or regulation of the European Parliament and of the Council establishing
a framework for the recovery and resolution of credit institutions and investment firms and/or within the context of a U.K. resolution
regime under the Banking Act 2009, as the same has been or may be amended from time to time (whether pursuant to the U.K. Financial
Services (Banking Reform) Act 2013 (the “Banking Reform Act 2013”), secondary legislation or otherwise, the
“Banking Act”), pursuant to which any obligations of a bank, banking group company, credit institution or investment
firm or any of its affiliates can be reduced, cancelled, modified, transferred and/or converted into shares or other securities
or obligations of the obligor or any other person (or suspended for a temporary period) or pursuant to which any right in a contract
governing such obligations may be deemed to have been exercised, “relevant U.K. resolution authority” means
any authority with the ability to exercise a U.K. bail-in power.


 




    
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IN WITNESS WHEREOF, the Company has caused
this Senior Note to be duly executed.


 


Dated: June 25, 2018


 


	 	Executed by 	 
	 	 	 	 	 
	 	THE ROYAL BANK OF SCOTLAND GROUP PLC
	 	 	 	 	 
	 	 	 	 	 
	 	By:	   	 
	 	 	Name:	 	 
	 	 	Title:	Authorized Signatory	 


 


 


 CERTIFICATE OF AUTHENTICATION


 


This is one
of the Senior Notes of the series designated herein referred to in the within-mentioned Indenture.


 




     


     


    

Dated: June 25, 2018


 


	 	THE BANK OF NEW YORK MELLON, LONDON BRANCH
	 	as Trustee	 
	 	 	 	 
	 	 	 	 
	 	By: 	  	 
	 	 	Authorized Signatory	 




    
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[Reverse of Note]


 


This
note is one of a duly authorized issue of securities of the Company (herein called the “Senior Notes”) issued
and to be issued in one or more series under an amended and restated Indenture dated as of December 13, 2017 (the “Amended
and Restated Indenture”), as amended and supplemented in respect of the Senior Notes by the Second Supplemental Indenture
dated as of June 25, 2018 (the “Second Supplemental Indenture” and, together with the Base Indenture, the “Indenture”),
in each case among the Company, as issuer, and The Bank of New York Mellon,
acting through its London Branch as trustee (herein called the “Trustee,” which term includes any successor
trustee under the Indenture). Reference is hereby made to the Indenture and all indentures supplemental thereto for a statement
of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of
the Senior Notes and of the terms upon which the Senior Notes are, and are to be, authenticated and delivered.


 


This Senior Note is one of the series designated
on the face hereof, initially limited in aggregate principal amount to $1,250,000,000.


 


The Company may, from time to time, without
the consent of the Holders of the Senior Notes, issue Additional Senior Debt Securities having the same ranking and interest rate,
Maturity Date, redemption terms and other terms as the Senior Notes of this series, except for the price to the public and issue
date. Any such Additional Senior Debt Securities, together with the Senior Notes of this series, will constitute a single series
of Senior Notes under the Indenture and shall be included in the definition of “Senior Debt Securities” in the Indenture
where the context requires; provided, however, that if such Additional Senior Debt Securities are not fungible with the Outstanding
Senior Notes of this series for U.S. federal income tax purposes, the Additional Senior Debt Securities must have a CUSIP, ISIN
and/or other identifying number (as the case may be) different from those used for the Outstanding Senior Notes of this series.


 


The Senior Notes will initially be issued
in the form of one or more global Senior Notes (each, a “Global Senior Note”). Except as provided in the Indenture,
a Global Senior Note shall not be exchangeable for one or more definitive Senior Notes.


 


The Senior Notes of this series will constitute
direct, unconditional, unsecured and unsubordinated obligations of the Company, as described herein, ranking pari passu
without any preference among themselves, and equally with all other outstanding unsecured and unsubordinated obligations, present
and future of the Company, except such obligations as are preferred by operation of law.


 


If an Event of Default with respect to the
Senior Notes of this series shall have occurred and be continuing, the Trustee or the Holder or Holders of not less than 25% in
aggregate principal amount of the Outstanding Senior Notes of this series may declare the principal amount of, and any accrued
interest on, all the Senior Notes to be due and


 




     


     


    

payable immediately, in the manner, with the effect and subject
to the conditions provided in the Indenture.


 


Except as otherwise provided in Article
5 of the Indenture, the Trustee may proceed to protect and enforce its rights and the rights of the Holders of the Senior Notes
whether in connection with any breach by the Company of its obligations under the Senior Notes, the Indenture or otherwise, including
by judicial proceedings, provided that the Company shall not, as a result of any such action by the Trustee, be required to pay
any amount representing or measured by reference to principal or interest on the Senior Notes prior to any date on which the principal
of, or any interest on, the Senior Notes would have otherwise been payable.


 


If a Default occurs and is continuing, the
Trustee may commence a proceeding for the winding up of the Company, provided that the Trustee may not declare the principal amount
of any Outstanding Senior Notes to be due and payable.


 


Notwithstanding any other provisions of
the Indenture, failure to make any payment on the Senior Notes shall not be a Default if it is withheld or refused, upon independent
counsel’s advice delivered to the Trustee, in order to comply with any applicable fiscal or other law or regulation or order
of any court of competent jurisdiction, provided, however, that the Trustee may require the Company to take any action which, upon
independent counsel’s advice delivered to the Trustee, is appropriate and reasonable in the circumstances (including proceedings
for a court declaration), in which case the Company shall immediately take and expeditiously proceed with the action and shall
be bound by any final resolution resulting therefrom. If any such action results in a determination that the relevant payment can
be made without violating any applicable law, regulation or order then the payment shall become due and payable on the expiration
of the applicable 14-day or seven-day period after the Trustee gives written notice to the Company informing it of such determination.


 


Subject to applicable law, the Trustee (acting
on behalf of the Holders) and the Holders of the Senior Notes by their acceptance thereof will be deemed to have waived to the
fullest extent permitted by law any right of set-off, counterclaim or combination of accounts with respect to the Senior Notes,
the Second Supplemental Indenture or the Amended and Restated Indenture (or between the Company’s obligations under or in
respect of the Senior Notes and any liability owed by a Holder to the Company) that they (or the Trustee acting on their behalf)
might otherwise have against the Company, whether before or during any winding-up, liquidation or administration of the Company.
Notwithstanding the above, if any of such rights and claims of any such Holder (or the Trustee acting on behalf of such Holders)
against the Company are discharged by set-off, such Holder (or the Trustee acting on behalf of such Holders) will immediately pay
an amount equal to the amount of such discharge to the Company or, in the event of any winding-up, liquidation or administration
of the Company, the liquidator or administrator (or other relevant insolvency official), as the case may be, to be held on trust
for the Senior Creditors and until such time as payment is made will hold a sum equal to such


 




    
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amount on trust for the Senior Creditors and
accordingly such discharge shall be deemed not to have taken place.


 


No remedy against the Company, other than
as referred to in Article 5 of the Indenture, shall be available to the Trustee or the Holders of the Senior Notes whether for
the recovery of amounts owing in respect of such Senior Notes or under the Indenture or in respect of any breach by the Company
of its obligations under the Indenture or in respect of the Senior Notes, except that the Trustee and the Holders shall have such
rights and powers as they are entitled to have under the Trust Indenture Act, including the Trustee’s prior lien on any amounts
collected following a Default or Event of Default for payment of the Trustee’s fees and expenses, and provided that any payments
on the Senior Notes are subject to the subordination provisions set forth in the Indenture.


 


All amounts of principal, premium, if any,
and interest on the Senior Notes will be paid by the Company without deduction or withholding for, or on account of, any and all
present and future income, stamp and other taxes, levies, imposts, duties, charges, fees, deductions or withholdings now or hereafter
imposed, levied, collected, withheld or assessed by or on behalf of the United Kingdom or any political subdivision or any authority
thereof or therein having the power to tax (the “U.K. Taxing Jurisdiction”), unless such deduction or withholding
is required by law.


 


If deduction or withholding of any such
taxes, levies, imposts, duties, charges, fees, deductions or withholdings shall at any time be required by the U.K. Taxing Jurisdiction,
the Company will pay such additional amounts with respect to the principal of and premium, if any, and interest on the Senior Notes
(“Additional Amounts”) as may be necessary in order that the net amounts paid to the Holders of the Senior Notes,
after such deduction or withholding, shall equal the amounts of such payments which would have been payable in respect of such
Senior Notes had no such deduction or withholding been required; provided, however, that the foregoing will not apply to any such
tax, levy, impost, duty, charge, fee, deduction or withholding that would not have been payable or due but for the fact that:


 


(i) the Holder or the beneficial owner of
the Senior Note is a domiciliary, national or resident of, or engaging in business or maintaining a permanent establishment or
physically present in, the U.K. Taxing Jurisdiction or otherwise has some connection with the U.K. Taxing Jurisdiction other than
the mere holding or ownership of a Senior Note, or the collection of the payment on any Senior Note,


 


(ii) except in the case of a winding-up
of the Company in the United Kingdom, the Senior Note is presented (where presentation is required) for payment in the United Kingdom,


 


(iii) the Senior Note is presented (where
presentation is required) for payment more than 30 days after the date payment became due or was provided for, whichever is later,
except to the extent that the Holder would have been entitled to such Additional


 




    
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Amount on presenting (where presentation is
required) the Senior Note for payment at the close of such 30 day period,


 


(iv) the Holder or the beneficial owner
of the Senior Note or the payment on such Senior Note failed to comply with a request by the Company or its liquidator or other
authorized person addressed to the Holder (x) to provide information concerning the nationality, residence or identity of the Holder
or such beneficial owner or (y) to make any declaration or other similar claim to satisfy any requirement, which in the case of
(x) or (y), is required or imposed by a statute, treaty, regulation or administrative practice of the U.K. Taxing Jurisdiction
as a precondition to exemption or relief from all or part of such deduction or withholding,


 


(v) the withholding or deduction is required
to be made pursuant to European Council Directive 2003/48/EC on the taxation of savings income or any Directive amending, supplementing
or replacing such Directive, or any law implementing or complying with, or introduced in order to conform to, such Directive or
Directives,


 


(vi) the withholding or deduction is required
to be made pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986, as amended, any agreement with the
U.S. Treasury entered into with respect thereto, any U.S. Treasury regulation issued thereunder or any other official interpretations
or guidance issued with respect thereto; any intergovernmental agreement entered into with respect thereto, or any law, regulation,
or other official interpretation or guidance promulgated pursuant to such an intergovernmental agreement,


 


(vii) the Senior Note is presented (where
presentation is required) for payment by or on behalf of a Holder who would have been able to avoid such withholding or deduction
by presenting (where presentation is required) the Senior Note to another paying agent in a Member State of the European Union,
or


 


(viii) any combination of subclauses (i)
through (vii) above,


 


nor shall Additional Amounts be paid with
respect to a payment on the Senior Notes to any Holder who is a fiduciary or partnership or person other than the sole beneficial
owner of such payment to the extent such payment would be required by the laws of the U.K. Taxing Jurisdiction to be included in
the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a member of such partnership or a beneficial
owner who would not have been entitled to such Additional Amounts, had it been the Holder.


 


Whenever in the Indenture there is mentioned,
in the context of Senior Notes, the payment of the principal, premium, if any, or interest on, or in respect of, any Senior Notes,
such mention shall be deemed to include mention of the payment of Additional Amounts provided for herein to the extent that, in
such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the provisions of the foregoing


 




    
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paragraph and as if express mention of the payment of Additional
Amounts (if applicable) were made in any provisions hereof where such express mention is not made.


 


The Company will have the option to redeem
Senior Notes of this series, in whole but not in part, on not less than 5 business days nor more than 60 calendar days’ notice,
at any time during the Fixed Rate Period and thereafter only on a Floating Rate Period Interest Payment Date, at a Redemption Price
equal to 100% of the principal amount, together with accrued but unpaid interest, if any, in respect of the Senior Notes to the
date fixed for redemption, if, at any time, the Company shall determine that as a result of a change in or amendment to the laws
or regulations of the U.K. Taxing Jurisdiction (including any treaty to which a U.K. Taxing Jurisdiction is a party), or any change
in the official application or interpretation of such laws or regulations (including a decision of any court or tribunal) which
change or amendment becomes effective on or after June 25, 2018:


 


(a)  in
making any payment under the Senior Notes, including any payment in respect of principal or premium, if any, or interest, the Company
has or will or would on the next Interest Payment Date become obligated to pay Additional Amounts;


 


(b)  payment
of interest on the next Interest Payment Date in respect of any of the Senior Notes would be treated as a “distribution”
within the meaning of Section 1000 of the Corporation Tax Act 2010 of the United Kingdom (or any statutory modification or re-enactment
thereof for the time being); or


 


(c)  on
the next Interest Payment Date the Company would not be entitled to claim a deduction in respect of such payment of interest in
computing its United Kingdom taxation liabilities (or the value of such deduction to the Company would be materially reduced).


 


In any case where the Company shall determine
that as a result of any change in the official application or interpretation of any laws or regulations it is entitled to redeem
Senior Notes of this series, the Company shall be required to deliver to the Trustee prior to the giving of any notice of redemption
a written legal opinion of independent United Kingdom counsel of recognized standing (selected by the Company) in a form satisfactory
to the Trustee confirming that the relevant change in the official application or interpretation of such laws or regulations has
occurred and that the Company is entitled to exercise its right of redemption.


 


The Company may, at the Company’s
option and in its sole discretion, redeem Senior Notes of this series, in whole but not in part, on June 25, 2023, at a Redemption
Price equal to 100% of the principal amount of the Senior Notes of this series together with any accrued but unpaid interest to,
but excluding, the Redemption Date.


 


The Company may, at the Company’s
option and in its sole discretion, redeem Senior Notes of this series, in whole but not in part, at any time during the Fixed Rate


 




    
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Period and thereafter only on a Floating Rate
Period Interest Payment Date, at a Redemption Price equal to 100% of the principal amount of the Senior Notes of this series together
with any accrued but unpaid interest to, but excluding, the Redemption Date, if the Company determines that a Loss Absorption Disqualification
Event has occurred and is continuing. Before the publication of any notice of redemption pursuant to a Loss Absorption Disqualification
Event, the Company shall deliver to the Trustee a certificate signed by two authorised signatories of the Company stating that,
in such signatories’ belief, the condition for redemption has occurred and is continuing as at the date of the certificate,
and the Trustee is entitled to conclusively rely on and shall accept such certificate as sufficient evidence of such occurrence,
in which event it shall be conclusive and binding on the Holders.


 


Notwithstanding any other provision, the
Company may only redeem Senior Notes of this series prior to their Maturity Date or repurchase Senior Notes (and give notice thereof
to the Holders of this series of Senior Notes in the case of redemption) if the Company has obtained the prior consent of the PRA,
to the extent such consent is at the relevant time and in the relevant circumstances required (if at all) by the Loss Absorption
Regulations or applicable laws or regulations in effect in the United Kingdom.


 


If the Company elects to redeem Senior Notes
of this series, the Senior Notes will cease to accrue interest from the Redemption Date, provided the Redemption Price has
been paid in accordance with the Indenture.


 


Upon
payment of (i) the amount of principal so declared due and payable
and (ii) accrued and unpaid interest, all of the Company’s obligations in respect of the payment of the principal of, and
accrued and unpaid interest on, the Senior Notes of this series shall terminate.


 


The Indenture permits, with certain exceptions
as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of
the Holders of the Senior Notes of each series to be affected thereby by the Company and the Trustee with the consent of the Holders
of not less than a majority in principal amount of the Senior Notes at the time outstanding of each such series. The Indenture
also contains provisions permitting the Holders of a majority in aggregate principal amount of the Outstanding Senior Notes of
each series, on behalf of the Holders of all Senior Notes of such series, to waive compliance by the Company with certain provisions
of the Indenture and certain past Events of Default and Defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Senior Note shall be conclusive and binding upon such Holder and upon all future Holders of this Senior
Note and of any Senior Note issued in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Senior Note.


 


No reference herein to the Indenture and
no provision of this Senior Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and


 




    
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unconditional, to pay, if and when due and payable, the principal
of, and interest on, this Senior Note at the times, place and rate, and in the coin or currency, herein prescribed.


 


As set forth in, and subject to, the provisions
of the Indenture, no Holder of any Senior Note of this series will have the right to institute any proceeding with respect to the
Indenture, this Senior Note or any remedy thereunder; provided, however, that such limitations do not apply to a suit instituted
by the Holder hereof for the enforcement of payment of the principal or interest as and when the same shall have become due and
payable in accordance with the terms hereof and the Indenture.


 


Notwithstanding any other term of any Senior
Notes, the Indenture, or any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial
Owner, by its acquisition of Senior Notes, each Holder (including each Beneficial Owner) of the Senior Notes acknowledges, accepts,
agrees to be bound by and consents to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority that may
result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on, the Senior Notes;
(ii) the conversion of all, or a portion, of the principal amount of, or interest on, the Senior Notes into ordinary shares or
other securities or other obligations of the Company or another person; and (iii) the amendment or alteration of the maturity of
the Senior Notes, or amendment of the amount of interest due on the Senior Notes, or the dates on which interest becomes payable,
including by suspending payment for a temporary period; which U.K. bail-in power may be exercised by means of variation of the
terms of the Senior Notes solely to give effect to the exercise by the relevant U.K. resolution authority of such U.K. bail-in
power. Each Holder (including each Beneficial Owner) of the Senior Notes further acknowledges and agrees that the rights of the
Holders and/or Beneficial Owners under the Senior Notes are subject to, and will be varied, if necessary, solely to give effect
to, the exercise of any U.K. bail-in power by the relevant U.K. resolution authority.


 


For these purposes, “U.K. bail-in
power” means any write-down, conversion, transfer, modification or suspension power existing from time to time under
any laws, regulations, rules or requirements relating to the resolution of banks, banking group companies, credit institutions
and/or investment firms incorporated in the United Kingdom in effect and applicable in the United Kingdom to the Company or other
members of the Group, including but not limited to any such laws, regulations, rules or requirements which are implemented, adopted
or enacted within the context of a European Union directive or regulation of the European Parliament and of the Council establishing
a framework for the recovery and resolution of credit institutions and investment firms and/or within the context of a U.K. resolution
regime under the Banking Act 2009, as the same has been or may be amended from time to time (whether pursuant to the U.K. Financial
Services (Banking Reform) Act 2013 (the “Banking Reform Act 2013”), secondary legislation or otherwise, the
“Banking Act”), pursuant to which any obligations of a bank, banking group company, credit institution or investment
firm or any of its affiliates can be reduced, cancelled, modified, transferred and/or converted into shares or other securities
or obligations of the obligor or any other person (or suspended


 




    
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for a temporary period) or pursuant to which any right in a
contract governing such obligations may be deemed to have been exercised, “relevant U.K. resolution authority”
means any authority with the ability to exercise a U.K. bail-in power.


 


By its acquisition of Senior Notes each
Holder (including each Beneficial Owner) of the Senior Notes:


 


(a)  acknowledges
and agrees that upon the exercise of the U.K. bail-in power by the relevant U.K. resolution authority it shall not give rise to
a Default or an Event of Default for purposes of Section 315(b) (Notice of Default) and Section 315(c) (Duties of the Trustee in
Case of Default) of the Trust Indenture Act;


 


(b)  to
the extent permitted by the Trust Indenture Act, waives any and all claims against the Trustee for, agrees not to initiate a suit
against the Trustee in respect of, and agrees that the Trustee shall not be liable for, any action that the Trustee takes, or abstains
from taking, in either case in accordance with the exercise of the U.K. bail-in power by the relevant U.K. resolution authority
with respect to the Senior Notes; and


 


(c)  acknowledges
and agrees that, upon the exercise of any U.K. bail-in power by the relevant U.K. resolution authority, (a) the Trustee shall not
be required to take any further directions from Holders of the Senior Notes under Section 5.12 of the Base Indenture, and (b) neither
the Base Indenture nor this Second Supplemental Indenture shall impose any duties upon the Trustee whatsoever with respect to the
exercise of any U.K. bail-in power by the relevant U.K. resolution authority.


 


Notwithstanding the foregoing, if, following
the completion of the exercise of the U.K. bail-in power by the relevant U.K. resolution authority, the Senior Notes remain outstanding
(for example, if the exercise of the U.K. bail-in power results in only a partial write-down of the principal of the Senior Notes),
then the Trustee’s duties under the Indenture shall remain applicable with respect to the Senior Notes following such completion
to the extent that the Company and the Trustee shall agree pursuant to a supplemental indenture or an amendment to the Second Supplemental
Indenture.


 


The exercise of any U.K. bail-in power by
the relevant U.K. resolution authority shall not constitute a default or an Event of Default under Section 5.01 of the Indenture.


 


By its acquisition of Senior Notes, each
Holder and Beneficial Owner shall be deemed to have:


 


(i)  consented
to the exercise of any U.K. bail-in power as it may be imposed without any prior notice by the relevant U.K. resolution authority
of its decision to exercise such power with respect to the Senior Notes and


 


(ii)  authorized,
directed and requested DTC and any direct participant in DTC or other intermediary through which it holds such Senior Notes to
take


 




    
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any and all necessary action, if
required, to implement the exercise of any U.K. bail-in power with respect to the Senior Notes as it may be imposed, without any
further action or direction on the part of such Holder or Beneficial Owner.


 


No repayment of the principal amount of
the Senior Notes or payment of interest on the Senior Notes shall become due and payable after the exercise of any U.K. bail-in
power by the relevant U.K. resolution authority unless, at the time that such repayment or payment, respectively, is scheduled
to become due, such repayment or payment would be permitted to be made by the Company under the laws and regulations of the United
Kingdom and the European Union applicable to the Company and the Group.


 


Upon the exercise of the U.K. bail-in power
by the relevant U.K. resolution authority with respect to the Senior Notes, the Company shall provide a written notice to DTC as
soon as practicable regarding such exercise of the U.K. bail-in power for purposes of notifying Holders of such occurrence. The
Company shall also deliver a copy of such notice to the Trustee for information purposes.


 


If the Company has elected to redeem Senior
Notes of this series but prior to the payment of the redemption amount with respect to such redemption the relevant U.K. resolution
authority exercises its U.K. bail-in power with respect to any Senior Notes, the relevant redemption notices shall be automatically
rescinded and shall be of no force and effect, and no payment of the redemption amount will be due and payable.


 


Any Holder (including each Beneficial Owner)
that acquires Senior Notes in the secondary market shall be deemed to acknowledge and agree to be bound by and consent to the same
provisions specified in the Indenture to the same extent as the Holders and Beneficial Owners of the Senior Notes that acquire
the Senior Notes upon their initial issuance, including, without limitation, with respect to the acknowledgement and agreement
to be bound by and consent to the terms of the Senior Notes related to the U.K. bail-in power.


 


This Senior Note will be governed by the
laws of the State of New York.


 


Unless otherwise defined herein, all terms
used in this Senior Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.


 




    
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EXHIBIT B


 


FORM OF FLOATING RATE NOTES


 


THIS SECURITY IS A GLOBAL SECURITY WITHIN
THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY
MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE.


 


CUSIP No. 780097 BH3


ISIN No. US780097BH35


 


THE ROYAL BANK OF SCOTLAND GROUP plc


 


floating
rate Notes due 2024

(“SENIOR NOTES”)


 


	No. [●]	$[●]


 


 THE ROYAL BANK OF SCOTLAND GROUP
plc (herein called the “Company,” which term includes any successor person under the Indenture (as defined
on the reverse hereof)), for value received, hereby promises to pay to CEDE & CO., or registered assignees, the principal
sum of $[●] ([●] million dollars) on June 25, 2024 (the “Maturity Date”), or on such earlier date
as the principal hereof may become due in accordance with the terms hereof and to pay interest thereon:


 


From (and including) June 25, 2018 to (but
excluding) the Maturity Date, quarterly in arrear on March 25, June 25, September 25 and December 25 of each year, beginning on
September 25, 2018, to (and including) the Maturity Date (each, an “Interest Payment Date”), equal to the three-month
U.S. dollar London interbank offered rate (“LIBOR”), as determined by the Calculation Agent on the applicable
Interest Determination Date, plus 1.550% per annum, accruing from June 25, 2018, to (but excluding) the Maturity Date (the “Floating
Interest Rate”) and which interest rate will be reset quarterly on March 25, June 25, September 25 and December 25 of
each year, beginning on September 25, 2018 (each an “Interest Reset Date”).


 




    
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“Interest Determination Date”
means the second London banking day preceding each applicable Interest Reset Date.


 


“London banking day”
means any day on which dealings in U.S. dollars are transacted in the London interbank market.


 


Subject to the provisions below, LIBOR shall
be determined by the Calculation Agent in accordance with the following provisions:


 


		i.	With respect to any Interest Determination Date, LIBOR will be the rate (expressed as a percentage per annum) for deposits
in U.S. dollars having a maturity of three months commencing on the related Interest Reset Date that appears on Reuters Page LIBOR01
as of 11:00 a.m., London time, on that Interest Determination Date. If no such rate appears, then LIBOR, in respect of that Interest
Determination Date, will be determined in accordance with the provisions described in (ii) below.



 


		ii.	With respect to an Interest Determination Date on which no rate appears on Reuters Page LIBOR01 (as defined below), the calculation
agent will request the principal London offices of each of four major reference banks in the London interbank market, as selected
and identified by the Company, to provide its offered quotation (expressed as a percentage per annum) for deposits in U.S. dollars
for the period of three months, commencing on the related Interest Reset Date, to prime banks in the London interbank market at
approximately 11:00 a.m., London time, on that Interest Determination Date and in a principal amount that is representative for
a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, then LIBOR on that Interest
Determination Date will be the arithmetic mean of those quotations. If fewer than two quotations are provided, then LIBOR on the
Interest Determination Date will be the arithmetic mean of the rates quoted at approximately 11:00 a.m., in the City of New York,
on the Interest Determination Date by three major banks in the City of New York, as selected and identified by the Company, for
loans in U.S. dollars to leading European banks, for a period of three months, commencing on the related Interest Reset Date, and
in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. If at least
two such rates are so provided, LIBOR on the Interest Determination Date will be the arithmetic mean of such rates. If fewer than
two such rates are so provided, LIBOR on the Interest Determination Date will be LIBOR in effect with respect to the immediately
preceding Interest Determination Date or, in the case of the initial Interest Determination Date, the first Floating Interest Rate.



 




    
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“Reuters Page LIBOR01”
means the display that appears on Reuters Page LIBOR01 or any page as may replace such page on such service (or any successor service)
for the purpose of displaying LIBOR of major banks for U.S. dollars.


 


All percentages resulting from any calculation
of any interest rate on this Senior Note will be rounded, if necessary, to the nearest one hundred thousandth of a percentage point,
with five one-millionths of a percentage point rounded upward, and all dollar amounts would be rounded to the nearest cent, with
one-half cent being rounded upward.


 


Notwithstanding the provisions relating
to the determination of LIBOR described above, if the Company (in consultation with the Calculation Agent to the extent practicable)
determines that LIBOR has ceased to be published on Reuters Page LIBOR01 as a result of LIBOR ceasing to be calculated or administered,
then the following provisions will apply:


 


		(1)	the Company will use reasonable endeavors to appoint
an Independent Adviser to determine a Successor Rate or, alternatively, if the Independent Adviser determines that there is no
Successor Rate, an Alternative Reference Rate, no later than 5 business days prior to an Interest Determination Date (the “IA
Determination Cut-off Date”), for purposes of determining the rate of interest for the Floating Rate Interest Period;



 


		(2)	if the Company is unable to appoint an Independent
Adviser, or the Independent Adviser appointed by the Company fails to determine a Successor Rate or an Alternative Reference Rate
prior to the IA Determination Cut-off Date, then the Company (in consultation with the Calculation Agent to the extent practicable
and acting in good faith) may determine a Successor Rate, or if the Company determines that there is no Successor Rate, an Alternative
Reference Rate, for purposes of determining the rate of interest for a Floating Rate Interest Period; provided, however,
that if the Company is unable or unwilling to determine a Successor Rate or an Alternative Reference Rate prior to an Interest
Determination Date in accordance with this sub-paragraph (2), the rate of interest will be equal to the rate of interest in effect
with respect to the immediately preceding Interest Determination Date, or, in the case of the initial Interest Determination Date,
the rate of interest will be equal to the Fixed Interest Rate.



 


If a Successor Rate or Alternative Reference
Rate is determined in accordance with the preceding provisions, such Successor Rate or Alternative Reference Rate shall be substituted
for LIBOR for all future Floating Rate Interest Periods.


 


If the Independent Adviser (in consultation
with the Company) or the Company, as applicable, determines that an Adjustment Spread is required to be applied to the Successor
Rate or the Alternative Reference Rate, as applicable, and determines the quantum of, or a formula or methodology for determining,
such Adjustment Spread, then such Adjustment Spread shall be applied to the Successor Rate or the Alternative


 




    
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Reference Rate, as applicable. If the Independent Adviser is,
or the Company is, as the case may be, unable to determine the quantum of, or a formula or methodology for determining, such Adjustment
Spread, then such Successor Rate or Alternative Reference Rate, as applicable, will apply without an Adjustment Spread.


 


If the Independent Adviser or the Company,
as the case may be, determines a Successor Rate or Alternative Reference Rate or, in each case, any Adjustment Spread, in accordance
with the above provisions, the Independent Adviser or the Company may also, following consultation with the Calculation Agent to
the extent practicable, specify changes to the Successor Rate or Alternative Reference Rate, as applicable, or, in each case, the
Adjustment Spread, as well as the day count fraction, business day convention, the definition of business day, the Interest Determination
Date or the Interest Payment Date, and related provisions and definitions. All such changes can be made in order to follow market
practice in relation to the Successor Rate or Alternative Reference Rate and such changes shall apply for all future Floating Rate
Interest Periods. Upon receipt of satisfactory documentation, the Trustee shall, at our direction and expense, effect such amendments
as may be required in order to give effect to this provision pursuant to a supplemental indenture or an amendment to the Indenture,
or issuances and authentication of new global or definitive notes in respect of this Senior Notes, and the Trustee shall not be
liable to any party for any consequences thereof, save as provided in the Indenture and this Senior Note. No Holder consent will
be solicited or required in connection with effecting the Successor Rate or Alternative Reference Rate or related changes, including
for the execution of any documents, amendments to the Indenture or this Senior Note or other steps by the Company, the Trustee,
the Calculation Agent or the principal paying agent (if required). The Company will, promptly following the determination of any
Successor Rate, Alternative Reference Rate or Adjustment Spread, give notice thereof and of any changes to the terms of this Senior
Note to the Trustee, the Calculation Agent, the principal paying agent and the Holders, in accordance with Section 1.05 and Section
1.06 of the Base Indenture. By its acquisition of this Senior Note, each Holder and Beneficial Owner of this Senior Note and each
subsequent Holder and Beneficial Owner acknowledges, accepts, agrees to be bound by, and consents to, the Independent Adviser or
the Company’s, as applicable, determination of the Successor Rate, Alternative Reference Rate or Adjustment Spread, as applicable,
any changes in connection therewith as contemplated by this provision, and to any amendment or alteration of the terms of the Senior
Note, including an amendment of the amount of interest due on the Senior Note, as may be required in order to give effect to this
provision. The Trustee shall be entitled to rely on this deemed consent in connection with any supplemental indenture or amendment
which may be necessary to effect the Successor Rate or Alternative Reference Rate.


 


By its acquisition of this Senior Note,
each Holder of this Senior Note waives any and all claims against the Trustee, the Calculation Agent and the principal paying agent
for, agrees not to initiate a suit against the Trustee, the Calculation Agent and the principal paying agent in respect of, and
agrees that neither the Trustee, the Calculation Agent or the principal paying agent will be liable for, any action that the Trustee,
the


 




    
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Calculation Agent or the paying agent, as
the case may be, takes, or abstains from taking, in each case in accordance with this provision. By its acquisition of this Senior
Note, each Holder of this Senior Note agrees that neither the Trustee, the Calculation Agent or the principal paying agent will
have any obligation to determine any Successor Rate, Alternative Reference Rate or Adjustment Spread (including any adjustments
thereto), including in the event of any failure by us to determine any Successor Rate, Alternative Reference Rate or Adjustment
Spread.


 


An Independent Adviser appointed pursuant
to the above provisions shall act in good faith and (in the absence of bad faith, gross negligence or willful misconduct) shall
have no liability whatsoever to the Company, the Trustee, the Calculation Agent or any Holder or Beneficial Owner for any determination
made by it or for any advice given to the Company in connection with any determination made by the Company, pursuant to the above
provisions.


 


No Successor Rate or Alternative Reference
Rate will be adopted pursuant to the above provisions, nor will any other amendment to the terms of this Senior Note be made, if
and to the extent that, in the Company’s determination, the same could reasonably be expected to prejudice the qualification
of this Senior Note as the Company’s and/or the Regulatory Group’s minimum requirements for (A) own funds and eligible
liabilities and/or (B) loss absorbing capacity instruments.


 


“Adjustment Spread”
means a spread (which may be positive or negative) or formula or methodology for calculating a spread, which the Independent Adviser
(in consultation with the Company) or the Company, as applicable, determines is required to be applied to the Successor Rate or
the Alternative Reference Rate, as applicable, as a result of the replacement of LIBOR with the Successor Rate or the Alternative
Reference Rate, as applicable, and is the spread, formula or methodology which:


 


		(i)	in the case of a Successor Rate, is recommended in relation to the replacement of LIBOR with the Successor Rate by any Relevant
Nominating Body; or



 


		(ii)	in the case of a Successor Rate for which no such recommendation has been made or in the case of an Alternative Reference Rate,
the Independent Adviser (in consultation with the Company) or the Company, as applicable, determines is recognized or acknowledged
as being in customary market usage for the purposes of determining floating rates of interest in respect of securities denominated
in U.S. dollars, where such rate has been replaced by the Successor Rate or the Alternative Reference Rate, as applicable; or



 


		(iii)	if no such customary market usage is recognized or acknowledged, the Independent Adviser in its discretion (in consultation
with the Company),



 




    
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or the Company in its discretion, as applicable, determines
(acting in good faith) to be appropriate.


 


“Alternative Reference Rate”
means the reference rate (and related alternative screen page or source, if available) that the Independent Adviser or the Company
(as applicable) determines has replaced LIBOR in customary market usage for the purposes of determining floating rates of interest
in respect of securities denominated in U.S. dollars, or, if the Independent Adviser or the Company (as applicable) determines
that there is no such rate, such other rate as the Independent Adviser or the Company (as applicable) determines, each as in our
own discretion acting in good faith, is most comparable to LIBOR.


 


“Floating Rate Interest Period”
means the period beginning on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest
Payment Date; provided that the first floating rate interest period will begin on June 25, 2018 and will end on (but
exclude) the first Interest Payment Date.


 


“Independent Adviser”
means an independent financial institution of international repute or other independent financial adviser experienced in the international
capital markets, in each case appointed by the Company at its own expense.


 


“Relevant Nominating
Body” means, in respect of a reference rate:


 


		(i)	the central bank, reserve bank, monetary authority or any similar institution for the currency to which such reference rate
relates, or any other central bank or other supervisory authority which is responsible for supervising the administrator of such
reference rate; or



 


		(ii)	any working group or committee sponsored by, chaired or co-chaired by or constituted at the request of (a) the central bank,
reserve bank, monetary authority or any similar institution for the currency to which such reference rate relates, (b) any central
bank or other supervisory authority which is responsible for supervising the administrator of such reference rate, (c) a group
of the aforementioned central banks or other supervisory authorities, (d) the International Swaps and Derivatives Association,
Inc. or any part thereof, or (e) the Financial Stability Board or any part thereof.



 


“Successor Rate” means
the reference rate (and related alternative screen page or source, if available) that the Independent Adviser or the Company (as
applicable) determines is a successor to or replacement of LIBOR which is recommended by any Relevant Nominating Body.


 


(i)  Interest
will be calculated on the basis of the actual number of days in each interest period, assuming a 360-day year. An interest period
will be the


 




    
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period beginning on (and including)
an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date; provided that the
first floating rate interest period will begin on June 25, 2018 and will end on (but exclude) the first Interest Payment Date.


 


(ii)  If
any scheduled Interest Reset Date or Interest Payment Date (other than the Maturity Date) is not a business day, such Interest
Reset Date or Interest Payment Date will be postponed to the next day that is a business day; provided that if that business
day falls in the next succeeding calendar month, such Interest Reset Date or Interest Payment Date will be the immediately preceding
business day. If any such Interest Payment Date (other than the Maturity Date) is postponed or brought forward as described above,
the payment of interest due on such postponed or brought forward Interest Payment Date will include interest accrued to but excluding
such postponed or brought forward Interest Payment Date.


 


The regular record dates for this Senior
Note will be the 15th calendar day preceding each Interest Payment Date, whether or not a business day.


 


If (i) the Company fails to pay any installment
of interest in respect of this Senior Note on or before the relevant Interest Payment Date and such failure continues for 14 days,
or (ii) the Company fails to pay all or any part of the principal amount of this Senior Note when it otherwise becomes due and
payable, whether upon redemption or otherwise, and such failure continues for 7 days (each of (i) and (ii), a “Default”),
the Trustee may commence a proceeding for the winding up of the Company, provided that the Trustee may not declare the principal
amount of any Outstanding Senior Notes to be due and payable.


 


Payment of the principal amount of, and
any interest on, this Senior Note will be made in such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts. Such payment shall be made to the Holder including through a Paying Agent
of the Company outside the United Kingdom for collection by the Holder.


 


Prior to due presentment of this Senior
Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Senior Note is registered as the owner of such Senior Note for the purpose of receiving payment of principal and
interest, if any, on such Senior Note and for all other purposes whatsoever, whether or not such Senior Note be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.


 




    
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Reference is hereby made to the further
provisions of this Senior Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect
as if set forth at this place.


 


Unless the certificate of authentication
hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Senior Note shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose.


 


Notwithstanding any other term of any Senior
Notes, the Indenture, or any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial
Owner, by its acquisition of this Senior Note, each Holder (including each Beneficial Owner) of this Senior Note acknowledges,
accepts, agrees to be bound by and consents to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority
that may result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on, this Senior
Note; (ii) the conversion of all, or a portion, of the principal amount of, or interest on, this Senior Note into ordinary shares
or other securities or other obligations of the Company or another person; and (iii) the amendment or alteration of the maturity
of this Senior Note, or amendment of the amount of interest due on this Senior Note, or the dates on which interest becomes payable,
including by suspending payment for a temporary period; which U.K. bail-in power may be exercised by means of variation of the
terms of this Senior Note solely to give effect to the exercise by the relevant U.K. resolution authority of such U.K. bail-in
power. Each Holder (including each Beneficial Owner) of this Senior Note further acknowledges and agrees that the rights of the
Holders and/or Beneficial Owners under this Senior Note are subject to, and will be varied, if necessary, solely to give effect
to, the exercise of any U.K. bail-in power by the relevant U.K. resolution authority.


 


For these purposes, “U.K. bail-in
power” means any write-down, conversion, transfer, modification or suspension power existing from time to time under
any laws, regulations, rules or requirements relating to the resolution of banks, banking group companies, credit institutions
and/or investment firms incorporated in the United Kingdom in effect and applicable in the United Kingdom to the Company or other
members of the Group, including but not limited to any such laws, regulations, rules or requirements which are implemented, adopted
or enacted within the context of a European Union directive or regulation of the European Parliament and of the Council establishing
a framework for the recovery and resolution of credit institutions and investment firms and/or within the context of a U.K. resolution
regime under the Banking Act 2009, as the same has been or may be amended from time to time (whether pursuant to the U.K. Financial
Services (Banking Reform) Act 2013 (the “Banking Reform Act 2013”), secondary legislation or otherwise, the
“Banking Act”), pursuant to which any obligations of a bank, banking group company, credit institution or investment
firm or any of its affiliates can be reduced, cancelled, modified, transferred and/or converted into shares or other securities
or obligations of the obligor or any other person (or suspended for a temporary period) or pursuant to which any right in a contract
governing such


 




    
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obligations may be deemed to have been exercised, “relevant
U.K. resolution authority” means any authority with the ability to exercise a U.K. bail-in power.


 




    
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IN WITNESS WHEREOF, the Company has caused
this Senior Note to be duly executed.


 


Dated: June 25, 2018


 


	 	Executed by 
	 	 
	 	THE ROYAL BANK OF SCOTLAND GROUP PLC
	 	 
	 	 
	 	By:	   	 
	 	 	Name:	 	 
	 	 	Title:	Authorized Signatory	 




     


     


    

CERTIFICATE OF AUTHENTICATION


 


This is one
of the Senior Notes of the series designated herein referred to in the within-mentioned Indenture.


 


Dated: June 25, 2018


 


	 	THE BANK OF NEW YORK MELLON, LONDON BRANCH
	 	as Trustee
	 	 
	 	 
	 	By: 	   	 
	 	 	Authorized Signatory	 




     


     


    

[Reverse of Note]


 


This
note is one of a duly authorized issue of securities of the Company (herein called the “Senior Notes”) issued
and to be issued in one or more series under an amended and restated Indenture dated as of December 13, 2017 (the “Amended
and Restated Indenture”), as amended and supplemented in respect of the Senior Notes by the Second Supplemental Indenture
dated as of June 25, 2018 (the “Second Supplemental Indenture” and, together with the Base Indenture, the “Indenture”),
in each case among the Company, as issuer, and The Bank of New York Mellon,
acting through its London Branch as trustee (herein called the “Trustee,” which term includes any successor
trustee under the Indenture). Reference is hereby made to the Indenture and all indentures supplemental thereto for a statement
of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of
the Senior Notes and of the terms upon which the Senior Notes are, and are to be, authenticated and delivered.


 


This Senior Note is one of the series designated
on the face hereof, initially limited in aggregate principal amount to $750,000,000.


 


The Company may, from time to time, without
the consent of the Holders of the Senior Notes, issue Additional Senior Debt Securities having the same ranking and interest rate,
Maturity Date, redemption terms and other terms as the Senior Notes of this series, except for the price to the public and issue
date. Any such Additional Senior Debt Securities, together with the Senior Notes of this series, will constitute a single series
of Senior Notes under the Indenture and shall be included in the definition of “Senior Debt Securities” in the Indenture
where the context requires; provided, however, that if such Additional Senior Debt Securities are not fungible with the Outstanding
Senior Notes of this series for U.S. federal income tax purposes, the Additional Senior Debt Securities must have a CUSIP, ISIN
and/or other identifying number (as the case may be) different from those used for the Outstanding Senior Notes of this series.


 


The Senior Notes will initially be issued
in the form of one or more global Senior Notes (each, a “Global Senior Note”). Except as provided in the Indenture,
a Global Senior Note shall not be exchangeable for one or more definitive Senior Notes.


 


The Senior Notes of this series will constitute
direct, unconditional, unsecured and unsubordinated obligations of the Company, as described herein, ranking pari passu
without any preference among themselves, and equally with all other outstanding unsecured and unsubordinated obligations, present
and future of the Company, except such obligations as are preferred by operation of law.


 


If an Event of Default with respect to the
Senior Notes of this series shall have occurred and be continuing, the Trustee or the Holder or Holders of not less than 25% in
aggregate principal amount of the Outstanding Senior Notes of this series may declare the principal amount of, and any accrued
interest on, all the Senior Notes to be due and


 




     


     


    

payable immediately, in the manner, with the effect and subject
to the conditions provided in the Indenture.


 


Except as otherwise provided in Article
5 of the Indenture, the Trustee may proceed to protect and enforce its rights and the rights of the Holders of the Senior Notes
whether in connection with any breach by the Company of its obligations under the Senior Notes, the Indenture or otherwise, including
by judicial proceedings, provided that the Company shall not, as a result of any such action by the Trustee, be required to pay
any amount representing or measured by reference to principal or interest on the Senior Notes prior to any date on which the principal
of, or any interest on, the Senior Notes would have otherwise been payable.


 


If a Default occurs and is continuing, the
Trustee may commence a proceeding for the winding up of the Company, provided that the Trustee may not declare the principal amount
of any Outstanding Senior Notes to be due and payable.


 


Notwithstanding any other provisions of
the Indenture, failure to make any payment on the Senior Notes shall not be a Default if it is withheld or refused, upon independent
counsel’s advice delivered to the Trustee, in order to comply with any applicable fiscal or other law or regulation or order
of any court of competent jurisdiction, provided, however, that the Trustee may require the Company to take any action which, upon
independent counsel’s advice delivered to the Trustee, is appropriate and reasonable in the circumstances (including proceedings
for a court declaration), in which case the Company shall immediately take and expeditiously proceed with the action and shall
be bound by any final resolution resulting therefrom. If any such action results in a determination that the relevant payment can
be made without violating any applicable law, regulation or order then the payment shall become due and payable on the expiration
of the applicable 14-day or seven-day period after the Trustee gives written notice to the Company informing it of such determination.


 


Subject to applicable law, the Trustee (acting
on behalf of the Holders) and the Holders of the Senior Notes by their acceptance thereof will be deemed to have waived to the
fullest extent permitted by law any right of set-off, counterclaim or combination of accounts with respect to the Senior Notes,
the Second Supplemental Indenture or the Amended and Restated Indenture (or between the Company’s obligations under or in
respect of the Senior Notes and any liability owed by a Holder to the Company) that they (or the Trustee acting on their behalf)
might otherwise have against the Company, whether before or during any winding-up, liquidation or administration of the Company.
Notwithstanding the above, if any of such rights and claims of any such Holder (or the Trustee acting on behalf of such Holders)
against the Company are discharged by set-off, such Holder (or the Trustee acting on behalf of such Holders) will immediately pay
an amount equal to the amount of such discharge to the Company or, in the event of any winding-up, liquidation or administration
of the Company, the liquidator or administrator (or other relevant insolvency official), as the case may be, to be held on trust
for the Senior Creditors and until such time as payment is made will hold a sum equal to such


 




    
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amount on trust for the Senior Creditors and
accordingly such discharge shall be deemed not to have taken place.


 


No remedy against the Company, other than
as referred to in Article 5 of the Indenture, shall be available to the Trustee or the Holders of the Senior Notes whether for
the recovery of amounts owing in respect of such Senior Notes or under the Indenture or in respect of any breach by the Company
of its obligations under the Indenture or in respect of the Senior Notes, except that the Trustee and the Holders shall have such
rights and powers as they are entitled to have under the Trust Indenture Act, including the Trustee’s prior lien on any amounts
collected following a Default or Event of Default for payment of the Trustee’s fees and expenses, and provided that any payments
on the Senior Notes are subject to the subordination provisions set forth in the Indenture.


 


All amounts of principal, premium, if any,
and interest on the Senior Notes will be paid by the Company without deduction or withholding for, or on account of, any and all
present and future income, stamp and other taxes, levies, imposts, duties, charges, fees, deductions or withholdings now or hereafter
imposed, levied, collected, withheld or assessed by or on behalf of the United Kingdom or any political subdivision or any authority
thereof or therein having the power to tax (the “U.K. Taxing Jurisdiction”), unless such deduction or withholding
is required by law.


 


If deduction or withholding of any such
taxes, levies, imposts, duties, charges, fees, deductions or withholdings shall at any time be required by the U.K. Taxing Jurisdiction,
the Company will pay such additional amounts with respect to the principal of and premium, if any, and interest on the Senior Notes
(“Additional Amounts”) as may be necessary in order that the net amounts paid to the Holders of the Senior Notes,
after such deduction or withholding, shall equal the amounts of such payments which would have been payable in respect of such
Senior Notes had no such deduction or withholding been required; provided, however, that the foregoing will not apply to any such
tax, levy, impost, duty, charge, fee, deduction or withholding that would not have been payable or due but for the fact that:


 


(i) the Holder or the beneficial owner of
the Senior Note is a domiciliary, national or resident of, or engaging in business or maintaining a permanent establishment or
physically present in, the U.K. Taxing Jurisdiction or otherwise has some connection with the U.K. Taxing Jurisdiction other than
the mere holding or ownership of a Senior Note, or the collection of the payment on any Senior Note,


 


(ii) except in the case of a winding-up
of the Company in the United Kingdom, the Senior Note is presented (where presentation is required) for payment in the United Kingdom,


 


(iii) the Senior Note is presented (where
presentation is required) for payment more than 30 days after the date payment became due or was provided for, whichever is later,
except to the extent that the Holder would have been entitled to such Additional


 




    
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Amount on presenting (where presentation is
required) the Senior Note for payment at the close of such 30 day period,


 


(iv) the Holder or the beneficial owner
of the Senior Note or the payment on such Senior Note failed to comply with a request by the Company or its liquidator or other
authorized person addressed to the Holder (x) to provide information concerning the nationality, residence or identity of the Holder
or such beneficial owner or (y) to make any declaration or other similar claim to satisfy any requirement, which in the case of
(x) or (y), is required or imposed by a statute, treaty, regulation or administrative practice of the U.K. Taxing Jurisdiction
as a precondition to exemption or relief from all or part of such deduction or withholding,


 


(v) the withholding or deduction is required
to be made pursuant to European Council Directive 2003/48/EC on the taxation of savings income or any Directive amending, supplementing
or replacing such Directive, or any law implementing or complying with, or introduced in order to conform to, such Directive or
Directives,


 


(vi) the withholding or deduction is required
to be made pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986, as amended, any agreement with the
U.S. Treasury entered into with respect thereto, any U.S. Treasury regulation issued thereunder or any other official interpretations
or guidance issued with respect thereto; any intergovernmental agreement entered into with respect thereto, or any law, regulation,
or other official interpretation or guidance promulgated pursuant to such an intergovernmental agreement,


 


(vii) the Senior Note is presented (where
presentation is required) for payment by or on behalf of a Holder who would have been able to avoid such withholding or deduction
by presenting (where presentation is required) the Senior Note to another paying agent in a Member State of the European Union,
or


 


(viii) any combination of subclauses (i)
through (vii) above,


 


nor shall Additional Amounts be paid with
respect to a payment on the Senior Notes to any Holder who is a fiduciary or partnership or person other than the sole beneficial
owner of such payment to the extent such payment would be required by the laws of the U.K. Taxing Jurisdiction to be included in
the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a member of such partnership or a beneficial
owner who would not have been entitled to such Additional Amounts, had it been the Holder.


 


Whenever in the Indenture there is mentioned,
in the context of Senior Notes, the payment of the principal, premium, if any, or interest on, or in respect of, any Senior Notes,
such mention shall be deemed to include mention of the payment of Additional Amounts provided for herein to the extent that, in
such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the provisions of the foregoing


 




    
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paragraph and as if express mention of the payment of Additional
Amounts (if applicable) were made in any provisions hereof where such express mention is not made.


 


The Company will have the option to redeem
Senior Notes of this series, in whole but not in part, on not less than 5 business days nor more than 60 calendar days’ notice,
only on an Interest Payment Date, at a Redemption Price equal to 100% of the principal amount, together with accrued but unpaid
interest, if any, in respect of the Senior Notes to the date fixed for redemption, if, at any time, the Company shall determine
that as a result of a change in or amendment to the laws or regulations of the U.K. Taxing Jurisdiction (including any treaty to
which a U.K. Taxing Jurisdiction is a party), or any change in the official application or interpretation of such laws or regulations
(including a decision of any court or tribunal) which change or amendment becomes effective on or after June 25, 2018:


 


(a)  in
making any payment under the Senior Notes, including any payment in respect of principal or premium, if any, or interest, the Company
has or will or would on the next Interest Payment Date become obligated to pay Additional Amounts;


 


(b)  payment
of interest on the next Interest Payment Date in respect of any of the Senior Notes would be treated as a “distribution”
within the meaning of Section 1000 of the Corporation Tax Act 2010 of the United Kingdom (or any statutory modification or re-enactment
thereof for the time being); or


 


(c)  on
the next Interest Payment Date the Company would not be entitled to claim a deduction in respect of such payment of interest in
computing its United Kingdom taxation liabilities (or the value of such deduction to the Company would be materially reduced).


 


In any case where the Company shall determine
that as a result of any change in the official application or interpretation of any laws or regulations it is entitled to redeem
Senior Notes of this series, the Company shall be required to deliver to the Trustee prior to the giving of any notice of redemption
a written legal opinion of independent United Kingdom counsel of recognized standing (selected by the Company) in a form satisfactory
to the Trustee confirming that the relevant change in the official application or interpretation of such laws or regulations has
occurred and that the Company is entitled to exercise its right of redemption.


 


The Company may, at the Company’s
option and in its sole discretion, redeem Senior Notes of this series, in whole but not in part, on June 25, 2023, at a Redemption
Price equal to 100% of the principal amount of the Senior Notes of this series together with any accrued but unpaid interest to,
but excluding, the Redemption Date.


 


The Company may, at the Company’s
option and in its sole discretion, redeem Senior Notes of this series, in whole but not in part, only on an Interest Payment Date,
at a Redemption Price equal to 100% of the principal amount of the Senior Notes of this


 




    
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series together with any accrued but unpaid
interest to, but excluding, the Redemption Date, if the Company determines that a Loss Absorption Disqualification Event has occurred
and is continuing. Before the publication of any notice of redemption pursuant to a Loss Absorption Disqualification Event, the
Company shall deliver to the Trustee a certificate signed by two authorised signatories of the Company stating that, in such signatories’
belief, the condition for redemption has occurred and is continuing as at the date of the certificate, and the Trustee is entitled
to conclusively rely on and shall accept such certificate as sufficient evidence of such occurrence, in which event it shall be
conclusive and binding on the Holders.


 


Notwithstanding any other provision, the
Company may only redeem Senior Notes of this series prior to their Maturity Date or repurchase Senior Notes (and give notice thereof
to the Holders of this series of Senior Notes in the case of redemption) if the Company has obtained the prior consent of the PRA,
to the extent such consent is at the relevant time and in the relevant circumstances required (if at all) by the Loss Absorption
Regulations or applicable laws or regulations in effect in the United Kingdom.


 


If the Company elects to redeem Senior Notes
of this series, the Senior Notes will cease to accrue interest from the Redemption Date, provided the Redemption Price has
been paid in accordance with the Indenture.


 


Upon
payment of (i) the amount of principal so declared due and payable
and (ii) accrued and unpaid interest, all of the Company’s obligations in respect of the payment of the principal of, and
accrued and unpaid interest on, the Senior Notes of this series shall terminate.


 


The Indenture permits, with certain exceptions
as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of
the Holders of the Senior Notes of each series to be affected thereby by the Company and the Trustee with the consent of the Holders
of not less than a majority in principal amount of the Senior Notes at the time outstanding of each such series. The Indenture
also contains provisions permitting the Holders of a majority in aggregate principal amount of the Outstanding Senior Notes of
each series, on behalf of the Holders of all Senior Notes of such series, to waive compliance by the Company with certain provisions
of the Indenture and certain past Events of Default and Defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Senior Note shall be conclusive and binding upon such Holder and upon all future Holders of this Senior
Note and of any Senior Note issued in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Senior Note.


 


No reference herein to the Indenture and
no provision of this Senior Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and
unconditional, to pay, if and when due and payable, the principal of, and interest on, this Senior Note at the times, place and
rate, and in the coin or currency, herein prescribed.


 




    
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As set forth in, and subject to, the provisions
of the Indenture, no Holder of any Senior Note of this series will have the right to institute any proceeding with respect to the
Indenture, this Senior Note or any remedy thereunder; provided, however, that such limitations do not apply to a suit instituted
by the Holder hereof for the enforcement of payment of the principal or interest as and when the same shall have become due and
payable in accordance with the terms hereof and the Indenture.


 


Notwithstanding any other term of any Senior
Notes, the Indenture, or any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial
Owner, by its acquisition of Senior Notes, each Holder (including each Beneficial Owner) of the Senior Notes acknowledges, accepts,
agrees to be bound by and consents to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority that may
result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on, the Senior Notes;
(ii) the conversion of all, or a portion, of the principal amount of, or interest on, the Senior Notes into ordinary shares or
other securities or other obligations of the Company or another person; and (iii) the amendment or alteration of the maturity of
the Senior Notes, or amendment of the amount of interest due on the Senior Notes, or the dates on which interest becomes payable,
including by suspending payment for a temporary period; which U.K. bail-in power may be exercised by means of variation of the
terms of the Senior Notes solely to give effect to the exercise by the relevant U.K. resolution authority of such U.K. bail-in
power. Each Holder (including each Beneficial Owner) of the Senior Notes further acknowledges and agrees that the rights of the
Holders and/or Beneficial Owners under the Senior Notes are subject to, and will be varied, if necessary, solely to give effect
to, the exercise of any U.K. bail-in power by the relevant U.K. resolution authority.


 


For these purposes, “U.K. bail-in
power” means any write-down, conversion, transfer, modification or suspension power existing from time to time under
any laws, regulations, rules or requirements relating to the resolution of banks, banking group companies, credit institutions
and/or investment firms incorporated in the United Kingdom in effect and applicable in the United Kingdom to the Company or other
members of the Group, including but not limited to any such laws, regulations, rules or requirements which are implemented, adopted
or enacted within the context of a European Union directive or regulation of the European Parliament and of the Council establishing
a framework for the recovery and resolution of credit institutions and investment firms and/or within the context of a U.K. resolution
regime under the Banking Act 2009, as the same has been or may be amended from time to time (whether pursuant to the U.K. Financial
Services (Banking Reform) Act 2013 (the “Banking Reform Act 2013”), secondary legislation or otherwise, the
“Banking Act”), pursuant to which any obligations of a bank, banking group company, credit institution or investment
firm or any of its affiliates can be reduced, cancelled, modified, transferred and/or converted into shares or other securities
or obligations of the obligor or any other person (or suspended for a temporary period) or pursuant to which any right in a contract
governing such obligations may be deemed to have been exercised, “relevant U.K. resolution authority” means
any authority with the ability to exercise a U.K. bail-in power.


 




    
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By its acquisition of Senior Notes each
Holder (including each Beneficial Owner) of the Senior Notes:


 


(a)  acknowledges
and agrees that upon the exercise of the U.K. bail-in power by the relevant U.K. resolution authority it shall not give rise to
a Default or an Event of Default for purposes of Section 315(b) (Notice of Default) and Section 315(c) (Duties of the Trustee in
Case of Default) of the Trust Indenture Act;


 


(b)  to
the extent permitted by the Trust Indenture Act, waives any and all claims against the Trustee for, agrees not to initiate a suit
against the Trustee in respect of, and agrees that the Trustee shall not be liable for, any action that the Trustee takes, or abstains
from taking, in either case in accordance with the exercise of the U.K. bail-in power by the relevant U.K. resolution authority
with respect to the Senior Notes; and


 


(c)  acknowledges
and agrees that, upon the exercise of any U.K. bail-in power by the relevant U.K. resolution authority, (a) the Trustee shall not
be required to take any further directions from Holders of the Senior Notes under Section 5.12 of the Base Indenture, and (b) neither
the Base Indenture nor this Second Supplemental Indenture shall impose any duties upon the Trustee whatsoever with respect to the
exercise of any U.K. bail-in power by the relevant U.K. resolution authority.


 


Notwithstanding the foregoing, if, following
the completion of the exercise of the U.K. bail-in power by the relevant U.K. resolution authority, the Senior Notes remain outstanding
(for example, if the exercise of the U.K. bail-in power results in only a partial write-down of the principal of the Senior Notes),
then the Trustee’s duties under the Indenture shall remain applicable with respect to the Senior Notes following such completion
to the extent that the Company and the Trustee shall agree pursuant to a supplemental indenture or an amendment to the Second Supplemental
Indenture.


 


The exercise of any U.K. bail-in power by
the relevant U.K. resolution authority shall not constitute a default or an Event of Default under Section 5.01 of the Indenture.


 


By its acquisition of Senior Notes, each
Holder and Beneficial Owner shall be deemed to have:


 


(i)  consented
to the exercise of any U.K. bail-in power as it may be imposed without any prior notice by the relevant U.K. resolution authority
of its decision to exercise such power with respect to the Senior Notes and


 


(ii)  authorized,
directed and requested DTC and any direct participant in DTC or other intermediary through which it holds such Senior Notes to
take any and all necessary action, if required, to implement the exercise of any U.K. bail-in power with respect to the Senior
Notes as it may be imposed, without any further action or direction on the part of such Holder or Beneficial Owner.


 




    
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No repayment of the principal amount of
the Senior Notes or payment of interest on the Senior Notes shall become due and payable after the exercise of any U.K. bail-in
power by the relevant U.K. resolution authority unless, at the time that such repayment or payment, respectively, is scheduled
to become due, such repayment or payment would be permitted to be made by the Company under the laws and regulations of the United
Kingdom and the European Union applicable to the Company and the Group.


 


Upon the exercise of the U.K. bail-in power
by the relevant U.K. resolution authority with respect to the Senior Notes, the Company shall provide a written notice to DTC as
soon as practicable regarding such exercise of the U.K. bail-in power for purposes of notifying Holders of such occurrence. The
Company shall also deliver a copy of such notice to the Trustee for information purposes.


 


If the Company has elected to redeem Senior
Notes of this series but prior to the payment of the redemption amount with respect to such redemption the relevant U.K. resolution
authority exercises its U.K. bail-in power with respect to any Senior Notes, the relevant redemption notices shall be automatically
rescinded and shall be of no force and effect, and no payment of the redemption amount will be due and payable.


 


Any Holder (including each Beneficial Owner)
that acquires Senior Notes in the secondary market shall be deemed to acknowledge and agree to be bound by and consent to the same
provisions specified in the Indenture to the same extent as the Holders and Beneficial Owners of the Senior Notes that acquire
the Senior Notes upon their initial issuance, including, without limitation, with respect to the acknowledgement and agreement
to be bound by and consent to the terms of the Senior Notes related to the U.K. bail-in power.


 


This Senior Note will be governed by the
laws of the State of New York.


 


Unless otherwise defined herein, all terms
used in this Senior Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.