Obligation Rabobank 6.875% ( XS0496281618 ) en EUR

Rabobank

100 % ⇌

Pays-Bas

XS0496281618 ( en EUR )

6.875% par an ( paiement annuel )

19/03/2020 - Obligation échue

Prospectus brochure de l'obligation Rabobank XS0496281618 en EUR 6.875%, échue

50 000 EUR

1 250 000 000 EUR

Rabobank est une banque coopérative néerlandaise multinationale spécialisée dans les services financiers pour les secteurs de l'agroalimentaire, des entreprises et des particuliers.

L'Obligation émise par Rabobank ( Pays-Bas ) , en EUR, avec le code ISIN XS0496281618, paye un coupon de 6.875% par an.
Le paiement des coupons est annuel et la maturité de l'Obligation est le 19/03/2020

IMPORTANT NOTICE
IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to the attached
Prospectus accessed from this page or otherwise received as a result of such access and you are therefore advised to read this
disclaimer page carefully before reading, accessing or making any other use of the attached Prospectus. In accessing the
attached Prospectus, you agree to be bound by the following terms and conditions, including any modifications to them from
time to time, each time you receive any information as a result of such access.
Confirmation of Your Representation: You have been sent the attached Prospectus on the basis that you have confirmed to
Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Trading as Rabobank International), Credit Suisse Securities (Europe)
Limited, Merrill Lynch International, Morgan Stanley & Co. International plc and UBS Limited being the sender of the
attached, (i) that the electronic mail (or e-mail) address to which it has been delivered is not located in the United States of
America, its territories and possessions, any State of the United States and the District of Columbia; and which include Puerto
Rico, the US Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands and (ii) that you consent
to delivery by electronic transmission.
This Prospectus has been sent to you in an electronic form. You are reminded that documents transmitted via this medium may
be altered or changed during the process of transmission and consequently none of Coöperatieve Centrale Raiffeisen-
Boerenleenbank B.A. (Rabobank Nederland) as Issuer, Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Trading as
Rabobank International), Credit Suisse Securities (Europe) Limited, Merrill Lynch International, Morgan Stanley & Co.
International plc or UBS Limited and any person who controls either of them or any director, officer, employee or agent of the
Issuer, Credit Suisse Securities (Europe) Limited, Merrill Lynch International, Morgan Stanley & Co. International plc or UBS
Limited or any person who controls either of them or any affiliate of any of the foregoing accepts any liability or responsibility
whatsoever in respect of any difference between the Prospectus distributed to you in electronic format and the hard copy
version available to you on request from the Issuer, Credit Suisse Securities (Europe) Limited, Merrill Lynch International,
Morgan Stanley & Co. International plc or UBS Limited.
You are reminded that the attached Prospectus has been delivered to you on the basis that you are a person into whose
possession this Prospectus may be lawfully delivered in accordance with the laws of jurisdiction in which you are located and
you may not nor are you authorised to deliver this Prospectus to any other person.
Restrictions: Nothing in this electronic transmission constitutes an offer of securities for sale in the United States or any other
jurisdiction. Any securities to be issued will not be registered under the Securities Act of 1933 (the "Securities Act") and may
not be offered or sold in the United States or to or for the account or benefit of U.S. persons (as such terms are defined in
Regulation S under the Securities Act) unless registered under the Securities Act or pursuant to an exemption from such
registration.
The following Prospectus may not be forwarded or distributed to any other person and may not be reproduced in any manner
whatsoever, and in particular, may not be forwarded to any U.S. person or to any U.S. address. Any forwarding, distribution or
reproduction of this document in whole or in part is unauthorised. Failure to comply with this directive may result in a violation
of the Securities Act or the applicable laws of other jurisdictions.
Under no circumstances shall this Prospectus constitute an offer to sell or the solicitation of an offer to buy nor shall there be
any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. This Prospectus may
only be communicated to persons in the United Kingdom in circumstances where section 21(1) of the Financial Services and
Markets Act 2000 does not apply to the Issuer.

Prospectus dated 17 March 2010

Rabobank Nederland
Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A.
1,250,000,000 6.875 per cent. Senior Contingent Notes due 2020

Issue Price of the Senior Contingent Notes: 100 per cent.

The 1,250,000,000 6.875 per cent. Senior Contingent Notes due 2020 (the "Senior Contingent Notes") will be issued by Coöperatieve Centrale
Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) ("Rabobank Nederland", the "Issuer" or the "Bank"). Interest on the Senior Contingent Notes
will accrue from (and including) 19 March 2010 (the "Issue Date") to (but excluding) the Maturity Date (or earlier redemption date, as applicable) at the
rate of 6.875 per cent. per annum, and will be payable annually in arrear on 19 March in each year. Payments on the Senior Contingent Notes will be
made without deduction for, or on account of, taxes of the Netherlands to the extent described under "Terms and Conditions of the Senior Contingent
Notes - Taxation".
Unless previously redeemed or purchased and cancelled, the Senior Contingent Notes will be redeemed at 100 per cent. of their principal amount on 19
March 2020 (the "Maturity Date"). Subject to satisfaction of certain conditions (as described herein), if the Equity Capital Ratio of the Rabobank Group
is less than 7 per cent. on an Initial Trigger Date and on the related Subsequent Trigger Test Date (each as defined in "Terms and Conditions of the Senior
Contingent Notes") the principal amount of all, but not some only, of the Senior Contingent Notes shall be automatically and permanently reduced to 25
per cent. of their original principal amount and all, but not some only, of the Senior Contingent Notes shall be redeemed by the Issuer at their Write Down
Redemption Price on the Write Down Redemption Date (each as defined in "Terms and Conditions of the Senior Contingent Notes"). In addition, upon
the occurrence of a Tax Law Change (as defined in "Terms and Conditions of the Senior Contingent Notes"), the Senior Contingent Notes may be
redeemed at the option of the Issuer prior to the Maturity Date in whole but not in part in an amount equal to their Redemption Price or Special
Redemption Price, as further described herein. The Senior Contingent Notes will constitute unsubordinated and (subject to Condition 4) unsecured
obligations of the Issuer and shall rank at all times pari passu and without any preference among themselves.
Application has been made to the Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten or "AFM"), in its capacity as
competent authority under the Dutch Financial Supervision Act (Wet op het financieel toezicht) and regulations thereunder (together "Dutch securities
laws"), for the approval of this Prospectus for the purposes of Directive 2003/71/EC (the "Prospectus Directive"). Applications have also been made for
the Senior Contingent Notes to be admitted to trading on Euronext Amsterdam by NYSE Euronext, a regulated market of Euronext Amsterdam N.V.
("Euronext Amsterdam"). References in this Prospectus to the Senior Contingent Notes being "listed" (and all related references) shall mean that the
Senior Contingent Notes have been admitted to trading on Euronext Amsterdam. Euronext Amsterdam is a regulated market for the purposes of the
Directive 2004/39/EC of the European Parliament and the Council on Markets in Financial Instruments. The denomination of the Senior Contingent
Notes shall be 50,000. The Senior Contingent Notes will initially be represented by a temporary global senior contingent note without interest coupons
in bearer form (the "Temporary Global Senior Contingent Note"), which will be deposited with a common depositary on behalf of Euroclear Bank
S.A./N.V. ("Euroclear") and Clearstream Banking, société anonyme ("Clearstream, Luxembourg") on the Issue Date. The Temporary Global Senior
Contingent Note will be exchangeable for interests in a global senior contingent note (the "Global Senior Contingent Note"), without interest coupons, on
or after a date which is expected to be 28 April 2010, upon certification as to non-U.S. beneficial ownership. Individual definitive Senior Contingent
Notes in bearer form ("Definitive Senior Contingent Notes") will only be available in certain limited circumstances as described herein. See "Summary of
the Provisions Relating to the Senior Contingent Notes in Global Form".
The Senior Contingent Notes will not be rated.
Prospective investors should have regard to the factors described under the section headed "Risk Factors" in this Prospectus.

Joint Lead Managers and Joint Bookrunners
BofA Merrill Lynch
Credit Suisse
Morgan Stanley
UBS Investment Bank
Joint Lead Manager
Rabobank International

This Prospectus is to be read in conjunction with all the documents which are incorporated herein by
reference (see "Important Information - Documents Incorporated by Reference" below).
The Senior Contingent Notes have not been and will not be registered under the U.S. Securities Act of 1933
(the "Securities Act") and the Senior Contingent Notes are subject to U.S. tax law requirements. Subject to
certain exceptions, Senior Contingent Notes may not be offered, sold or delivered within the United States or
to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the Securities Act).
EACH PURCHASER OF THE SENIOR CONTINGENT NOTES MUST COMPLY WITH ALL
APPLICABLE LAWS AND REGULATIONS IN FORCE IN ANY JURISDICTION IN WHICH IT
PURCHASES, OFFERS OR SELLS THE SENIOR CONTINGENT NOTES OR POSSESSES OR
DISTRIBUTES THIS PROSPECTUS AND MUST OBTAIN ANY CONSENT, APPROVAL OR
PERMISSION REQUIRED BY IT FOR THE PURCHASE, OFFER OR SALE BY IT OF THE
SENIOR CONTINGENT NOTES UNDER THE LAWS AND REGULATIONS IN FORCE IN ANY
JURISDICTION TO WHICH IT IS SUBJECT OR IN WHICH IT MAKES SUCH PURCHASES,
OFFERS OR SALES, AND NEITHER THE ISSUER NOR THE JOINT LEAD MANAGERS SHALL
HAVE ANY RESPONSIBILITY THEREFOR.
This Prospectus does not constitute an offer of, or an invitation by or on behalf of the Issuer or the Joint Lead
Managers (as defined in "Subscription and Sale" below) to subscribe or purchase, any of the Senior
Contingent Notes. The distribution of this Prospectus and the offering of the Senior Contingent Notes in
certain jurisdictions may be restricted by law. Persons into whose possession this Prospectus comes are
required by the Issuer and the Joint Lead Managers to inform themselves about and to observe any such
restrictions.
For a description of further restrictions on offers and sales of Senior Contingent Notes and distribution of this
Prospectus see "Subscription and Sale" below.
No person is authorised to give any information or to make any representation not contained in this
Prospectus and any information or representation not so contained must not be relied upon as having been
authorised by or on behalf of the Issuer or the Joint Lead Managers. Neither the delivery of this Prospectus
nor any sale made in connection herewith shall, under any circumstances, create any implication that there has
been no change in the affairs of the Issuer since the date hereof or the date upon which this Prospectus has
been most recently amended or supplemented or that there has been no adverse change in the financial
position of the Issuer since the date hereof or the date upon which this Prospectus has been most recently
amended or supplemented or that the information contained in it or any other information supplied in
connection with the Senior Contingent Notes is correct as of any time subsequent to the date on which it is
supplied or, if different, the date indicated in the document containing the same.
The Joint Lead Managers have not separately verified the information contained in this Prospectus. The Joint
Lead Managers make no representation, express or implied, and to the fullest extent permitted by law accept
no responsibility, with respect to the accuracy or completeness of any of the information in this Prospectus.
Neither this Prospectus nor any other financial statements are or should be considered as a recommendation
by the Issuer or the Joint Lead Managers that any recipient of this Prospectus or any other financial statements
should purchase the Senior Contingent Notes. Prospective investors should have regard to the factors
described under the section headed "Risk Factors" in this Prospectus. This Prospectus does not describe all of
the risks of an investment in the Senior Contingent Notes. Each potential purchaser of Senior Contingent
Notes should determine for itself the relevance of the information contained in this Prospectus and its
purchase of Senior Contingent Notes should be based upon such investigation as it deems necessary.
Unless otherwise specified or the context requires, references to "£" are to the currency of the United
Kingdom, "dollars", "U.S. dollars" and "U.S.$" are to United States dollars, and references to "EUR" and "

2

are to euro, which means the lawful currency of the member states of the European Union that have adopted
the single currency in accordance with the Treaty establishing the European Community.
In connection with this issue of Senior Contingent Notes, Credit Suisse Securities (Europe) Limited (the
"Stabilising Manager") (or persons acting on behalf of any Stabilising Manager) may over-allot Senior
Contingent Notes or effect transactions with a view to supporting the market price of the Senior Contingent
Notes at a level higher than that which might otherwise prevail. However, there is no assurance that the
Stabilising Manager (or persons acting on behalf of the Stabilising Manager) will undertake stabilisation
action. Any stabilisation action may begin on or after the date on which adequate public disclosure of the
terms of the offer of the Senior Contingent Notes is made and, if begun, may be ended at any time, but it must
end no later than the earlier of 30 days after the issue date of the Senior Contingent Notes and 60 days after
the date of the allotment of the Senior Contingent Notes. Any stabilisation action or over-allotment must be
conducted by the relevant Stabilising Manager (or person(s) acting on behalf of the Stabilising Manager) in
accordance with all applicable laws and rules.
All figures in this Prospectus have not been audited, unless stated otherwise. Such figures are internal figures
of Rabobank Nederland or Rabobank Group (as defined hereafter).

3

TABLE OF CONTENTS
RISK FACTORS .............................................................................................................................................. 5
IMPORTANT INFORMATION ................................................................................................................... 13
FORWARD-LOOKING STATEMENTS ..................................................................................................... 15
GENERAL OVERVIEW OF THE OFFERING ......................................................................................... 16
TERMS AND CONDITIONS OF THE SENIOR CONTINGENT NOTES ............................................. 21
SUMMARY OF PROVISIONS RELATING TO THE SENIOR CONTINGENT NOTES WHILE IN
GLOBAL FORM ................................................................................................................................... 33
DESCRIPTION OF BUSINESS OF THE RABOBANK GROUP............................................................. 35
THE RABOBANK GROUP STRUCTURE................................................................................................. 46
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS ................................................................................................................................. 49
SELECTED FINANCIAL INFORMATION ............................................................................................... 81
RISK MANAGEMENT ................................................................................................................................. 84
GOVERNANCE OF THE RABOBANK GROUP ...................................................................................... 89
REGULATION OF THE RABOBANK GROUP ...................................................................................... 106
USE OF PROCEEDS ....................................................................................................................................111
TAXATION ....................................................................................................................................................112
SUBSCRIPTION AND SALE ......................................................................................................................114
GENERAL INFORMATION .......................................................................................................................116

4

RISK FACTORS
The Issuer believes that the following factors may affect its ability to fulfil its obligations under the Senior
Contingent Notes. All of these factors are contingencies which may or may not occur and the Issuer is not in a
position to express a view on the likelihood of any such contingency occurring.
In addition, factors which are material for the purpose of assessing the market risks associated with the
Senior Contingent Notes are also described below.
The Issuer believes that the factors described below represent the principal risks inherent in investing in the
Senior Contingent Notes, but the Issuer may be unable to pay interest, principal or other amounts on or in
connection with the Senior Contingent Notes for other reasons and the Issuer does not represent that the
statements below regarding the risks of holding the Senior Contingent Notes are exhaustive. Prospective
investors should also read the detailed information set out elsewhere in this Prospectus (including any
documents deemed to be incorporated by reference herein) and reach their own views prior to making any
investment decision.
Factors that may affect the Issuer's ability to fulfil its obligations under the Senior Contingent
Notes
Business and general economic conditions
The profitability of Rabobank Group could be adversely affected by a continued worsening of general
economic conditions in the Netherlands and/or globally. The financial crisis which started in the second half
of 2007 affects all banks, particularly in respect of funding due to the liquidity shortage. Factors such as
interest rates, inflation, deflation, investor sentiment, the availability and cost of credit, the liquidity of the
global financial markets and the level and volatility of equity prices can significantly affect the activity level
of customers and the profitability of Rabobank Group. For example, the continuing economic downturn, or
significantly higher interest rates, could adversely affect the credit quality of Rabobank Group's assets by
increasing the risk that a greater number of its customers would be unable to meet their obligations.
Moreover, the market downturn and worsening of the economy could cause Rabobank Group to incur further
mark-to-market losses in its trading portfolios or could reduce the fees Rabobank Group earns for managing
assets or the levels of assets under management. In addition, the continuing market downturn and increased
competition for savings in the Netherlands could lead to a decline in the volume of customer transactions that
Rabobank Group executes and, therefore, a decline in customer deposits and the income it receives from fees
and commissions and interest. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations Factors affecting results of operations General market conditions" and "Impact of
the financial crisis". Continuing volatility in the financial markets or a protracted economic downturn in the
Netherlands or Rabobank Group's other major markets could have a material adverse effect on Rabobank
Group's results of operations.
Credit risk
Credit risk is the risk that a client defaults on its obligations to pay sums due. In order to minimise this risk,
Rabobank Group pursues a prudent policy for accepting new clients, characterised by careful assessment of
clients and their ability to make repayments. Rabobank Group grants loans only if it is expected that a client
can fully meet its obligations. Approval of larger financing applications is decided on by various committees,
the level of the applicable committee depending on the amount of total exposure including the requested
financing. The Executive Board decides on the largest financing applications.
EAD (Exposure at Default), PD (Probability of Default) and LGD (Loss Given Default) are important Basel
II parameters that are increasingly being used in the context of credit risk management, and it is partly on

5

these parameters that Rabobank Group determines the economic capital and the RAROC (Risk-Adjusted
Return On Capital).
The use of Basel II parameters and RAROC supports credit analysts and credit committees in making well-
considered decisions. Every entity of Rabobank Group has determined a RAROC target at customer level.
Next to credit quality, this is an important factor in taking decisions on specific credit applications. The EAD
is defined as the Bank's exposure to the client in the case of a default. At the end of 2008, the EAD of
Rabobank Group's credit portfolio amounted to ¡¢¡ £¤¥¥¤
¡
£ ¤ ¥¥ ¤
¤
¥ $
%
!"
¦ §
¨ ©
¦ §

§
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potential future usage of unused credit lines. In its financing approval process, Rabobank Group uses the
Rabobank risk rating, which reflects the counterparty's PD over a one-year period. Counterparties have been
assigned to one of 25 rating classes, including four default ratings. The final four categories are used if the
customer defaults, and cover situations varying from payment arrears of 90 days to bankruptcy.
Rabobank Group's portfolio is divided across a large number of business sectors. This creates a high level of
and balanced risk diversification, so that the quality of the credit loan portfolio should not significantly
deteriorate if one or more business sectors go through a difficult period or are adversely affected by the
current economic recession. As a result of Rabobank Group's high level of diversification, it has not
experienced major fluctuations in its levels of profitability in the past. However, the current economic
downturn may result in loan losses that are above Rabobank Group's long-term average, which could have a
material adverse effect on Rabobank Group's results of operations.
Bad debt costs/average private sector lending ratio
At Rabobank Group level, the average for bad debt costs as a percentage of private sector lending during the
past 10 years was 21 basis points1, while the first half of 2009 it was 55 basis points on an annual basis. For
the wholesale and international retail banking operations, the bad debt costs as a percentage of private sector
lending increased from 51 basis points in the first half of 2008 to 123 basis points in the first half of 2009,
mainly due to the economic downturn. The Irish real estate sector was particularly affected in 2008 and in the
first half of 2009. For the domestic retail operations, this ratio increased from -8 basis points in the first half
of 2008 to 34 basis points in the first half of 2009. The ratio for the leasing portfolio increased from 62 basis
points in the first half of 2008 to 133 basis points in the first half of 2009. Continuing adverse financial
conditions in the Netherlands or Rabobank Group's other major markets could further increase Rabobank
Group's bad debt costs, which could have a material adverse effect on Rabobank Group's results of
operations.
Country risk
With respect to country risk, a distinction can be made between transfer risk and collective debtor risk.
Transfer risk relates to the possibility of foreign governments placing restrictions on funds transfers from
debtors in that country to creditors abroad. Collective debtor risk relates to the situation in which a large
number of debtors in a country cannot meet their commitments for the same reason (e.g. war, political and
social unrest or natural disasters, but also government policy that does not succeed in creating macro-
economic and financial stability). Rabobank Group uses a country limit system to manage transfer risk and
collective debtor risk. After careful review, relevant countries are given an internal country risk rating, after
which transfer limits and general limits are established.
Transfer limits are determined according to the net transfer risk, which is defined as total loans granted, less
loans granted in local currency, less guarantees and other collateral obtained to cover transfer risk, and less a
reduced weighting of specific products. The limits are allocated to the offices, which are themselves

1 One basis point is 0.01 per cent.

6

responsible for the day-to-day monitoring of the loans granted by them and for reporting on this to Group
Risk Management.
At Rabobank Group level, the country risk outstanding, including additional capital requirements and
provisions for country risks, is reported every quarter to Rabobank Group's Balance Sheet and Risk
Management Committee (the "BRMC-RG") and the Country Limit Committee. The calculation of additional
capital requirements and provisions for country risk are made in accordance with internal guidelines and
concern countries with a high transfer risk.
At 31 December 2008, the net transfer risk before provisions for non-OECD countries was 1.2 per cent.
(2007: 1.2 per cent.).
Interest rate risk
An important risk component for Rabobank Group is interest rate risk. Interest rate risk is the risk, outside the
trading environment, of deviations in interest income and/or the market value of capital as a result of changes
in market interest rates. Interest rate risk results mainly from mismatches between the periods for which
interest rates are fixed for loans and funds entrusted. If interest rates increase, the rate for the liabilities, such
as savings, can be adjusted immediately. This does not apply to the majority of the assets, such as mortgages,
which have longer interest rate fixation periods.
Funding and liquidity risk
Liquidity risk is the risk that not all (re)payment commitments can be met. This could happen if clients or
other professional counterparties suddenly withdraw more funding than expected, which cannot be met by
Rabobank Group's cash resources or by selling or pledging assets or by borrowing funds from third parties.
In addition to having a diversified funding base, maintaining appropriate levels of central bank-eligible
collateral and limiting net cash outflows, methods of managing and measuring liquidity risk include the
CA/CL method (Core Assets/Core Liabilities). This analysis is based on the cash flow schedule of assets and
liabilities. A quantification is made of the assets (and unused facilities) and liabilities that will probably still
be or come onto the balance sheet after a defined stress scenario has taken place. These remaining assets and
liabilities are referred to as Core Assets and Core Liabilities respectively. The CA/CL ratio is the liquidity
ratio. Given the weightings used, a ratio of below 1.2 is considered adequate. In 2008, this was the case for
the scenarios used.
Market risk
Market risk relates to changes in the value of the trading portfolio as a result of price movements in the
market. Price changes include prices of interest rates products (interest rate), equities, currencies, certain
commodities and derivatives. The exposure is calculated and consolidated on a daily basis and managed using
a sophisticated system of limits. At a consolidated level, the exposure is expressed by the "Value at Risk".
This measure, based on historic market developments, indicates the maximum loss that Rabobank Group can
suffer subject to a certain confidence level in "normal" market conditions. The level of the Value at Risk
reflects market developments and the positions taken by Rabobank Group itself.
In order to understand the maximum potential risk, the effect of certain extreme events (event risk) on the
value of the portfolios is calculated. To this end, both actual and hypothetical scenarios are analysed.
Sensitivity analyses are also used.
In 2008, the Value at Risk fluctuated between (¢ )¤¥¥¤
%
¡ 1
)¤¥ ¥ ¤
¤
( 8
)¤ ¥¥ ¤
¦ §
0§
¦ § 2
3
'
0 §
0 4
5 06
¦ 7
¦ §
Although positions were reduced, the instability in the financial markets in the latter half of 2008 resulted in a
substantial rise in the Value at Risk. The value of Rabobank Group's trading portfolio is affected by the

7

factors above. A deterioration in the value of Rabobank Group's trading portfolio could have a material
adverse effect on Rabobank Group's result of operations.
Currency risk
Currency risk positions can be found in both trading and non-trading books. As is the case with other market
risks, the currency risk in the trading books is controlled using Value at Risk limits. Currency risk in the non-
trading books relates exclusively to the translation risk2 on capital invested in foreign activities and issues of
Trust Preferred Securities not denominated in euro. Translation risk is the risk that exists when assets or
liabilities are denominated in a currency deviating from the presentation currency.
Operational risk
As a risk type, operational risk has acquired its own distinct position in the banking world. It is understood to
mean "the risk of losses resulting from failure of internal processes, people or systems or from external
events". Events of recent decades in modern international banking have shown on several occasions that
ineffective control of operational risks can lead to substantial losses. Under the Basel II accord, banks must
hold capital for this risk. Examples of operational risk incidents are highly diverse: fraud, claims relating to
inadequate products, losses due to poor occupational health and safety conditions, errors in transaction
processing, non-compliance with the law and system failures.
Legal risk
Rabobank Group is subject to a comprehensive range of legal obligations in all countries in which it operates.
As a result, Rabobank Group is exposed to many forms of legal risk, which may arise in a number of ways.
Rabobank Group faces risk where legal proceedings are brought against it. Regardless of whether such claims
have merit, the outcome of legal proceedings is inherently uncertain and could result in financial loss.
Defending legal proceedings can be expensive and time-consuming and there is no guarantee that all costs
incurred will be recovered even if Rabobank Group is successful. Although Rabobank Group has processes
and controls to manage legal risks, failure to manage these risks could impact Rabobank Group adversely,
both financially and in terms of reputation.
Tax risk
Rabobank Group is subject to the tax laws of all countries in which it operates. Tax risk is the risk associated
with changes in tax law or in the interpretation of tax law. It also includes the risk of changes in tax rates and
the risk of failure to comply with procedures required by tax authorities. Failure to manage tax risks could
lead to an additional tax charge. It could also lead to a financial penalty for failure to comply with required tax
procedures or other aspects of tax law. If, as a result of a particular tax risk materialising, the tax costs
associated with particular transactions are greater than anticipated, it could affect the profitability of those
transactions.
Effect of governmental policy and regulation
Rabobank Group's businesses and earnings can be affected by the fiscal or other policies and other actions of
various governmental and regulatory authorities in the Netherlands, the European Union, the United States
and elsewhere. Areas where changes could have an impact include, but are not limited to, the monetary,
interest rate and other policies of central banks and regulatory authorities, changes in government or
regulatory policy that may significantly influence investor decisions in particular markets in which Rabobank
Group operates, changes and rules in competition and pricing environments, developments in the financial
reporting environment, or unfavourable developments producing social instability or legal uncertainty which
in turn may affect demand for Rabobank Group's products and services. Regulatory compliance risk arises
from a failure or inability to comply fully with the laws, regulations or codes applicable specifically to the

2 Translation risk is the risk that exists when assets or liabilities are denominated in a currency deviating from the presentation currency.

8

financial services industry. Non-compliance could lead to fines, public reprimands, damage to reputation,
enforced suspension of operations or, in extreme cases, withdrawal of authorisations to operate.
In 2008, several large commercial banks and financial institutions in the Netherlands, including ABN AMRO,
Fortis Nederland, ING Group and SNS Reaal, received financial support from the Dutch government. This
may affect the competitive environment in which Rabobank Group operates in the Netherlands.
Rabobank Group is subject to capital requirements that could limit its operations
Rabobank Group is subject to capital adequacy guidelines pursuant to the Dutch Financial Supervision Act,
which provide for a minimum ratio of total capital to risk-adjusted assets. At least half of the total capital must
be maintained in the form of Tier 1 Capital. Rabobank Group's failure to maintain its ratios may result in
administrative actions or sanctions against it which may impact Rabobank Group's ability to fulfil its
obligations under the Senior Contingent Notes.
Factors which are material for the purpose of assessing the market risks associated with the
Senior Contingent Notes
The Senior Contingent Notes may not be a suitable investment for all investors
Each potential investor in the Senior Contingent Notes must determine the suitability of that investment in
light of its own circumstances. In particular, each potential investor should:
(a)
have sufficient knowledge and experience to make a meaningful evaluation of the Senior Contingent
Notes, the merits and risks of investing in the Senior Contingent Notes and the information contained
or incorporated by reference in this Prospectus or any applicable supplement;
(b)
have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its
particular financial situation, an investment in the Senior Contingent Notes and the impact the Senior
Contingent Notes will have on its overall investment portfolio;
(c)
have sufficient financial resources and liquidity to bear all of the risks of an investment in the Senior
Contingent Notes, including where the currency for principal or interest payments is different from the
potential investor's currency;
(d)
understand thoroughly the terms of the Senior Contingent Notes and be familiar with the behaviour of
any relevant financial markets; and
(e)
be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for
economic, interest rate and other factors that may affect its investment and its ability to bear the
applicable risks.
Senior Contingent Notes may be redeemed at their Write Down Redemption Price in certain prescribed
circumstances which may be difficult to predict and consequently the trading behaviour of the Senior
Contingent Notes may be unpredictable
Provided a notice of redemption pursuant to Condition 7(b) has not previously been given and an Event of

Default has not occurred (or if one has occurred, provided it has been remedied prior to the Subsequent

Trigger Test Date (as defined below)), if on any date during the period from (and including) the Issue Date to

(but excluding) the date 25 Business Days prior to the Maturity Date the Equity Capital Ratio is less than 7

per cent. and the Issuer delivers to the Fiscal Agent a certificate of that fact, and 20 Business Days after

notifying the Holders of the Equity Capital Ratio being less than 7 per cent. (such date a "Subsequent Trigger
Test Date"), the Equity Capital Ratio is less than 7 per cent. and the Issuer delivers to the Fiscal Agent a
certificate of that fact, the principal amount of all of the Senior Contingent Notes will be automatically and
permanently reduced to 25 per cent. of their original principal amount and three Business Days later, all of the

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