
Article 1 
The asset transfer from FIH Group to the Danish Financial Stability Company, together with the side agreements, constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.
This State aid is compatible with the internal market, in the light of the restructuring plan and the commitments set out in the Annex.
Article 2 
This Decision is addressed to the Kingdom of Denmark.
Done at Brussels, 11 March 2014.
For the Commission
Joaquín ALMUNIA
Vice-President
ANNEX
1. 
The Kingdom of Denmark undertakes to ensure that the Restructuring Plan for FIH submitted on 24 June 2013 is correctly and fully implemented. This document (the ‘Term Sheet’) sets out the terms (the ‘Commitments’) for the restructuring of FIH Erhvervsbank A/S including subsidiaries (‘FIH’), which the Kingdom of Denmark has committed to implement.

2. 
In this document, unless the context requires otherwise, the singular shall include the plural (and vice versa) and the capitalised terms used herein have the following meanings:


Term Meaning
Commitments mean the undertakings related to the restructuring of FIH set out in this Term Sheet
Decision means the decision of the European Commission on the restructuring of FIH in the context of which these Commitments are undertaken and to which this Term Sheet is attached
Restructuring Period is the time period specified in clause 3.2
Restructuring Plan means the plan submitted by FIH to the European Commission, via the Kingdom of Denmark, on 24 June 2013, as amended and supplemented by written communications
FIH or FIH Group FIH Erhvervsbank A/S including subsidiaries
FIH Holding FIH Holding A/S
FIH Holding Group FIH Holding A/S including direct and indirect subsidiaries
FS Property Finance A/S The wholly owned subsidiary of the Financial Stability Company FSC, also referred to in the decision as ‘Newco’.
Acquisition Finance The separate and dedicated business unit with employees solely focusing on financing solutions in connection with mergers and acquisitions, and which was marketed specifically towards existing and potential clients.

3.  3.1. The Kingdom of Denmark undertakes to ensure that the Commitments are fully observed during the implementation of the Restructuring Plan.
 3.2. The Restructuring Period shall end on 31 December 2016. The Commitments apply during the Restructuring Period, unless otherwise indicated.

4.  4.1. 
FIH will cease all business activities in the business field Acquisition Finance by 30 June 2014. The existing portfolio will be placed in run off by 30 June 2014.
 4.2. 
FIH has withdrawn from the business area of investment properties and closed that business area by 31 December 2013. There will be no re-entry into that business area which means in particular that no new lending (capital) to finance investment in investment properties in Denmark, Sweden, Germany or any other country will take place.
 4.3. 
FIH will divest its investments in private equity funds and other equity investments to the extent permitted by law as early as possible and in any case not later than 31 December 2016. If a divestment by that date is not possible, the investments will be put in run-off which means in particular that no funding or renewals of investments may take place any more. Further, from the date of the Decision, no new private equity or other investments will be made (with the exceptions stated in footnote 3).
 4.4. 
FIH shall not have a mortgage institute in its company structure by end of 2014, and shall not act as a mortgage bank thereafter.

5. 
5.1. Ban on acquisitionsFIH shall not acquire any stake in any undertaking. This applies both to undertakings which have the legal form of a company and packages of assets which form a business.Activities not comprised by the acquisition banThis ban does not apply to acquisitions that must be made in exceptional circumstances to maintain financial stability or in the interests of effective competition, provided they have been approved beforehand by the Commission. This does neither apply to acquisitions that take place in the ordinary course of the banking business in the management of existing claims towards ailing firms and to disposal and restructuring within FIH Holding Group.Exemptions not requiring the Commission’s prior approvalFIH may acquire stakes in undertakings provided that the purchase price paid by FIH for any acquisition is less than 0,01 % of the balance sheet size of FIH at the date of the Commission decision and that the cumulative purchase prices paid by FIH for all such acquisitions over the whole restructuring period is less than 0,025 % of the balance sheet size of FIH at the date of the Commission decision.5.2. Ban on commercial aggressive practicesFIH shall avoid engaging in aggressive commercial practices throughout the duration of the Restructuring Plan.5.3. DepositsFIH will not offer more favourable prices for deposit products (notably but not exclusively for retail deposits in FIH Direct Bank) than the two best-priced competitors in a given market.
The restriction does not apply if FIH’s share of the total deposit market is less than 5 %.5.4. AdvertisingFIH must not use the granting of the aid measures or any advantages arising therefrom for advertising purposes. Further, its overall annual advertising expenses will be below EUR 1 million.5.5. Ban on coupon paymentsFIH will refrain during the Restructuring Period from making any payments on capital instruments, unless those payments stem from a legal obligation, and not call or buy back those instruments without prior approval of the Commission. Coupons on capital instruments held by the state may be paid, unless such payments would trigger coupon payments to other investors that otherwise would not be mandatory. This commitment not to pay coupons during the Restructuring Period does not apply for newly issued instruments (meaning instruments issued after the Commission’s final approval of the restructuring plan), provided any payment of coupons on such newly issued instruments will not create a legal obligation to make any coupon payments on FIH’s securities existing at the moment of the adoption of the Commission’s Restructuring Decision.5.6. Ban on dividend paymentsAll dividends paid to FIH Holding will be retained until settlement of the share purchase agreement respectively the end of the Restructuring Period, whichever is longer. Thus, FIH Holding shall not distribute funds to its shareholders by way of dividends or otherwise until the final settlement of the purchase price agreement. To retain earnings in the FIH Holding group, FIH shall not pay dividends to other entities than FIH Holding.5.7. Restrictions on FIH Holding related to ownershipFIH Holding shall not pledge its shareholding in FIH. Related party transactions shall be at arm’s length. No decision affecting the creditworthiness or liquidity of FIH Holding compromising its capability of paying a negative variable purchase price if required shall be taken.
FIH Holding is only allowed to conduct business as holding company for FIH and any shareholder loans shall not be repaid.5.8. Buy Back of Hybrid Capital Instruments or other Capital InstrumentsWith regard to the buy-back of hybrid capital instruments or other capital instruments existing in FIH on 2 March 2012, FIH will respect the rules concerning Tier 1 and Tier 2 capital transactions as set out in the MEMO/09/441 of 8 October 2008. In any case FIH will consult the Commission before making announcements to the market concerning Tier 1 and Tier 2 capital transactions.

6. 
FIH will remunerate the measure in line with the IAC. Specifically, in addition to making a one off payment of DKK 310,25 million + 37,5 million * N/365, where N is the number of days between 30 September 2013 and the final payment date, which, according to the Danish authorities has already occurred with value date 4 December 2013, FIH will:


— each year, from 2014 to 2020 or the year following the final settlement of the purchase price agreement, whichever is earlier, pay a fee of DKK 12,1 million per annum with value date 30 September (or, if 30 September of the respective date is not a business day, on the following business day). The final fee is to be paid on the settlement date of the purchase price agreement, and reduced pro rata temporis (on an actual over actual basis) for the period between the penultimate fee payment (30 September) and the settlement of the purchase price agreement as well as for the first period, from 4 December 2013 to 30 September 2014,
— reduce the management fees for administration and hedging charged to FS Property Finance A/S to 0,05 % per annum of the outstanding loan portfolio, retroactively effective from 1 January 2013,
— pay an annual fee of DKK 47,2 million to FSC if the FSA changes its regulatory view regarding capital requirements at holding level such that FIH’s lending capacity would no longer be restricted by FIH Holding’s capital position. Value dates and time limitations similar to the first indent above apply.

7.  7.1. The Kingdom of Denmark shall ensure that the full and correct implementation of the Restructuring Plan and the full and correct implementation of all Commitments within this Term Sheet are continuously monitored.
 7.2. The Kingdom of Denmark will report semi-annually to the Commission on the evolution of the Restructuring Plan and the above mentioned commitments until the end of the Restructuring Period.
 7.3. Within three months of the final settlement of the transaction the Kingdom of Denmark will provide a report made by an external certified accountant on the accurateness of the settlement of the transaction.
