Prospectus-Final (clean) - Malta Financial Services Authority

Risk Factors regarding the NotesThe following is a disclosure of risk factors that are material to the Notes issued under theProgramme in order to assess the market risk associated with these Notes. Prospectiveinvestors should consider these risk factors before deciding to purchase Notes issued underthe Programme.In respect of Notes which require in view of their specific structure a specific description ofrisk factors, those specific additional risk factors will be described in the Final Terms relatingto such Notes.Notes may not be a suitable investment for all investorsEach potential investor in Notes must determine the suitability of that investment in light of its owncircumstances. In particular, each potential investor should:(i)(ii)(iii)(iv)(v)have sufficient knowledge and experience to make a meaningful evaluation of the relevantNotes, the merits and risks of investing in the relevant Notes and the information contained orincorporated by reference in this Prospectus or any applicable supplement;have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of itsparticular financial situation and the investment(s) it is considering, an investment in the Notesand the impact the Notes will have on its overall investment portfolio;have sufficient financial resources and liquidity to bear all of the risks of an investment in therelevant Notes, including where principal or interest is payable in one or more currencies, orwhere the currency for principal or interest payments is different from the potential investor'scurrency;understand thoroughly the terms of the relevant Notes and be familiar with the behaviour ofany relevant indices and financial markets; andbe able to evaluate (either alone or with the help of a financial adviser) possible scenarios foreconomic, interest rate and other factors that may affect its investment and its ability to bearthe applicable risks.Some Notes are complex financial instruments. Sophisticated institutional investors generally do notpurchase complex financial instruments as stand-alone investments. They purchase complex financialinstruments as a way to reduce risk or enhance yield with an understood, measured, appropriateaddition of risk to their overall portfolio. A potential investor should not invest in Notes which arecomplex financial instruments unless it has the expertise (either alone or with a financial adviser) toevaluate how the Notes will perform under changing conditions, the resulting effects on the value ofthe Notes and the impact this investment will have on the potential investor's overall investmentportfolio.Liquidity RiskApplication has been made to list Notes to be issued under the Programme on the official list of and toadmit such Notes to trading on the Regulated Market of the Luxembourg Stock Exchange. In addition,the Programme provides that Notes may be listed on an alternative stock exchange or may not belisted at all. Regardless of whether the Notes are listed or not, there can be no assurance that a liquidsecondary market for the Notes will develop or, if it does develop, that it will continue. The fact that theNotes may be listed does not necessarily lead to greater liquidity than if they were not listed. If theNotes are not listed on any exchange, pricing information for such Notes may, however, be moredifficult to obtain which may affect the liquidity of the Notes adversely. In an illiquid market, an investormight not be able to sell his Notes at any time at fair market prices. The possibility to sell the Notesmight additionally be restricted by country specific reasons.Market Price RiskThe development of market prices of the Notes depends on various factors, such as changes ofmarket interest rate levels, the policy of central banks, overall economic developments, inflation ratesor the lack of or excess demand for the relevant type of Note. The holder of a Note is therefore40