Amendments to the Instructions for the CSD Service - Monte Titoli

***These amendments will enter into force on 4 February 2013.Instructions for the CSD Service3.9 Financial instruments of public debtomissis3.9.3 Placement operationsIn general Government bonds are admitted to the System after placement by auctionmanaged by Bank of Italy through the “Placement of government bonds (COLTIT) procedure”and the related settlement operation performed by Monte Titoli through the EXPRESS IISettlement Service take place.At the end of these activities Monte Titoli enters the relative registrations on Intermediariesand Issuers accounts.On the day of auction, after the operations have been performed, Bank of Italy (throughCOLTIT procedure sends the data on trades concluded to the Express II Settlement Service,in particular:- data on the bond consignments that the awardees must be credited on the settlement day- data on the cash items that the Bank of Italy must be credited on the settlement day.The Bank of Italy informs Monte Titoli Titoli by electronic message of the nominal value ofeach financial instrument placed. Monte Titoli Titoli confirms the acceptance/rejection of theoperation with the Bank of Italy.On the day of settlement of the auction, the operations are settled by the Express IISettlement Service and Monte Titoli informs Intermediaries of the outcome of accountingmovements by electronic message.The same provisions apply, insofar as they are compatible, in the case of centralisationsubsequent to a distribution of government bonds via the market platform. In suchcase reference shall be made to the timescale established in the issue decree and/or inother communications of the Ministry and the Notice published by Borsa Italiana.omissis3.9.9 Coupon stripping/unstrippingThe stripping/unstripping operation can only be made on Government Bonds for which theissuer has provided for this possibility in the decree of issue and for which Monte Titoli haspublished the plans for stripping operations.The stripping/unstripping operation may be required to Monte Titoli, exclusively by qualifiedintermediaries, with a special electronic message, and provides specific operating proceduresbased on the type of securities as described below.Index linked Government Bonds2

• the stripping operation provides for debiting the nominal value of the original bondand crediting the nominal value of the principal and the strips;• the unstripping operation provides for crediting the nominal value of the original bondand debiting the nominal value of the principal and the strips.Non-indexed Government Bonds• the stripping operation provides for debiting the nominal value of the original bondand crediting the nominal value of the hybrid coupon (which is the sum of the laststrip and of the ex principal) and of the other strips;• the unstripping operation provides for the crediting of the nominal value of the originalbond and the debiting of the nominal value of the hybrid coupon and other strips.Monte Titoli announces the accounting movements by electronic messages.Stripping/unstripping operations are permitted up to 5 working days before the date ofpayment.According to the date of issue of the original bond (government bonds issued after 1January 2013), to ensure non-fungibility, for the same maturity date, with couponslinked to original bonds issued before 31 December 2012, Monte Titoli differentiatesbetween stripping plans by using different ISIN codes.For each type of bond subject to stripping, Monte Titoli publishes weekly a report on itswebsite www.montetitoli.it showing the total amount subjected to the process, the residuethat may be subjected to stripping as well as details of the stripping/unstripping made. Thereports are published separately according to the issue date of the original bond(respectively government bonds issued before 31 December 2012 and governmentbonds issued after 1 January 2013). Monte Titoli also publishes the existing stripping plans.on its website at www.montetitoli.it.***3.21 Non-dematerialised financial instrumentsomissis3.21.7 Reduction of the nominal value/quantityThe System enables Issuers to reduce the nominal value or quantity of centralised financialinstruments that they have issued.The operation may be performed by the Issuer, using cash in hand deposited:a) in the Issuer's own securities account, in the capacity of Intermediary;b) in the securities account of any Intermediary that is a member of the SystemThe reduction operation is performed by Monte Titoli upon a mandate from the Issuer bysending message "General Mandate", indicating:- the ISIN code of the financial instrument that is to have its nominal value (quantity)reduced and the relevant indicator;- the amount of financial instruments indicated by quantity or nominal value3