Notice Concerning Borrowing under Unsecured Perpetual Subordinated Loan with Write-down Clause and Reinstatement Clause

TOKYO--()--

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

Notice Concerning Borrowing under Unsecured Perpetual Subordinated Loan with Write-down Clause and Reinstatement Clause

Today, The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) has determined to borrow under an unsecured perpetual subordinated loan with optional-repayment clause, write-down clause and reinstatement clause from its parent company, Mitsubishi UFJ Financial Group, Inc.

1. Type of Loan Unsecured perpetual subordinated loan with optional-repayment clause, write-down clause and reinstatement clause (the “Loan”)
2. Principal Amount JPY 250 billion
3. Term Perpetual

Provided, however, that BTMU may, at its discretion, repay the principal amount on any interest payment date on July 15, 2026 or thereafter or upon the occurrence of a tax event or a capital event.

4. Interest Rate From the day immediately following March 3, 2016 until July 15, 2026:

1.94% per annum

From the day immediately following July 15, 2026:

6-month euro-yen LIBOR + 1.80%

5. Drawdown Date March 3, 2016
6. Interest Payment Dates January 15 and July 15 of each year
7. Summary of Interest Cancellation Clause (1) Optional cancellation of interest payments

BTMU, at its discretion, may cancel all or part of the interest payments under the Loan when it deems necessary.

(2) Interest payable amount limitation

The amount of interest payable on any interest payment date under the Loan shall not exceed the Interest Payable Amount and BTMU shall not pay any amount of interest under the Loan in excess of the Interest Payable Amount.

(The “Interest Payable Amount” shall be calculated by dividing the Adjusted Distributable Amount on a pro rata basis among the amount of interest payable under the Loan and each amount of interests and dividends payable on the same interest payment date under each preferred share directly issued by BTMU which rank most senior in priority of payment as to dividends and each parity security (including each parity loan).)

(The “Adjusted Distributable Amount” shall be the distributable amount under the Companies Act as of the interest payment date less the total amount of interests and dividends of the Loan, parity securities (including parity loans) and junior securities (including junior loans) paid on any day preceding the interest payment date within the fiscal year in which such interest payment date falls.)

The amount of interest under the Loan which have not been paid according to (1) or (2) above shall not be accrued and payment obligation thereof shall be discharged thereafter.

8. Summary of Write-down Clause (1) Write-down upon the occurrence of a loss absorption event

When BTMU’s consolidated or non-consolidated Common Equity Tier1 capital ratio falls below 5.125%, the principal amount and the corresponding amount of interest under the Loan shall be written down to the extent necessary, as determined by BTMU in consultation with the Financial Services Agency of Japan or other relevant regulatory authority, to make BTMU’s consolidated and non-consolidated Common Equity Tier1 capital ratio exceed 5.125% by write-down of all or part of the principal of the Loan and write-down or conversion to ordinary shares of all or part of the principal of each other Additional Tier1 liability on a pro rata basis.

(2) Write-down upon the occurrence of a non-viability event

The principal amount and interests under the Loan shall be written down to zero when it is confirmed that the “item 2 measures (dai nigou sochi)” or the “item 3 measures (dai sangou sochi)”, which are the measures set forth in Article 102, Paragraph 1, Items 2 and 3 of the Deposit Insurance Act, or that the “specified item 2 measures (tokutei dai nigou sochi),” which are the measures set forth in Article 126-2, Paragraph 1, Item 2 of the Deposit Insurance Act, need to be applied to BTMU.

(3) Write-down upon the occurrence of a bankruptcy proceedings commencement event

The principal amount and interest under the Loan shall be written down to zero when it is adjudicated that BTMU becomes subject to bankruptcy and other insolvency proceedings.

9. Summary of Reinstatement Clause When all or part of the principal amount of the Loan have been written down upon the occurrence of a loss absorption event, such principal amount of the Loan shall be reinstated upon the occurrence of a Reinstatement Event to the extent of the amount to be determined by BTMU in consultation with the Financial Services Agency of Japan or other relevant regulatory authority.

(The “Reinstatement Event” occurs when BTMU determines that the principal amount of the Loan that have been written-down be reinstated after obtaining prior confirmation of the Financial Services Agency of Japan or any other relevant regulatory authority that BTMU’s consolidated and non-consolidated Common Equity Tier1 capital ratio remains at a sufficiently high level after giving effect to the relevant reinstatement of the Loan.)

10. Use of Proceeds To enhance the regulatory capital of BTMU. The Loan will be qualified as BTMU’s Additional Tier1 capital under the current applicable capital adequacy requirements.
11. Liquidation Preference The Loan ranks, as to the payment of liabilities in our liquidation proceedings (excluding special liquidation proceedings), effectively, junior to the general creditors and dated subordinated creditors of BTMU, senior to the BTMU’s common shares, and pari passu with BTMU’s preferred shares and its special purpose companies’ preferred securities.
12. Lender Mitsubishi UFJ Financial Group, Inc.
This press release has been prepared for the purpose of publicly announcing the borrowing under an unsecured perpetual subordinated loan with optional-repayment clause, write-down clause and reinstatement clause and not for the purpose of soliciting investment.

Short Name: Bnk Tokyo-Mitsubishi
Category Code: MSC
Sequence Number: 512281
Time of Receipt (offset from UTC): 20160226T025930+0000

Contacts

The Bank of Tokyo-Mitsubishi UFJ, Ltd

Contacts

The Bank of Tokyo-Mitsubishi UFJ, Ltd