Triodos Bank N.V. has published a new prospectus relating to its offer of depository receipts of ordinary shares Triodos Bank (Depository Receipts). This new prospectus replaces any previous versions. A summary of the most important changes in respect of the Depository Receipts, including changes in the way in which we offer and facilitate transactions in Depository Receipts, is set out below. Full details are available in the new prospectus.
The way in which Triodos Bank facilitates transactions in Depository Receipts is also described in more detail in the ´Principles for facilitating transactions in Depository Receipts of shares in the capital of Triodos Bank'. Both this document and the new prospectus can be found online at triodos.co.uk/dr, in the ‘Key Documents’ section.
Change in facilitating transactions in Depository Receipts
Triodos Bank facilitates transactions to and from Depository Receipt holders, by (re)purchasing and (re)selling Depository Receipts. Depository Receipts are directly linked to the capital of the bank; the amount of Depository Receipts the bank can repurchase is therefore limited by regulation.
Triodos Bank may decide to limit or suspend its facilitating activities, e.g. in case Triodos Bank has reached or approaches its regulatory limit to repurchase Depository Receipts, or in case of unbalanced order volumes. As a consequence, investors may during a period of time of several months, or much longer, not be able to sell their Depository Receipts.
Maximum amount sell orders
To facilitate transactions in a controlled way, the total value of Depository Receipts that may be offered for sale by any Depository Receipt holder can be restricted. From the date of re-opening the maximum value that may be sold to Triodos Bank will be restricted to an amount of EUR 5,000 per investment account per week. We will monitor the sales and demand patterns carefully and may adjust this amount again in future.
Transparency on amount available for repurchase
The regulatory amount of Depository Receipts which Triodos Bank can repurchase to compensate for periods when more Depository Receipts are sold by DR holders than are being bought has been increased from EUR 28.2 million to EUR 36 million. This increase was made with approval from the Annual General Meeting.
At the moment of re-opening the amount that has been repurchased prior to 18 March 2020 is EUR 20,130,866. From the day of reopening of trade, Triodos Bank will publish the amount of Depository Receipts it has repurchased. This will enable Depository Receipt holders to see what room Triodos Bank has available to repurchase Depository Receipts in case of an imbalance between supply and demand. This information can be found here.
Financial impact of COVID-19
As a bank, Triodos Bank's business is materially affected by conditions in the financial markets and economic conditions. The current economic downturn, due to the COVID-19 crisis, has affected and may continue to materially and adversely affect Triodos Bank’s business and financial condition. Triodos Bank has implemented various measures and will continue to closely monitor developments to safeguard the bank’s operations and to ensure business continuity towards clients. Our capital and liquidity position is expected to remain robust and resilient, in line with internal target ratios and well above the regulatory minimum requirements.
Our overall loan portfolio benefits from geographical diversification and reflects modest asset risk.
In the short-term, customers will face economic challenges, especially if COVID-19 related government support schemes expire. However, in the medium and long term, we believe our customers – and therefore Triodos Bank itself – are well positioned to be part of a more sustainable and socially inclusive economic recovery that is expected to emerge.
Our priority in the second half of the year 2020 is to navigate the bank through the COVID-19 crisis and to focus on the effective execution of our corporate strategy, ensuring we fulfil our role as frontrunner in responsible finance whilst generating maximum impact, a moderate risk appetite regarding its loans and investments and a profit in line with our goals.
Price of Depository Receipts
While trading in Depository Receipts has been suspended, the calculation of the price has continued as usual every week and currently stands at EUR 84.00 [18 March 2020: EUR 84.00]. This information can be found here.
Our Depository Receipts derive their value from the calculated value of the bank’s net assets (all assets minus all liabilities). This approach avoids uncontrolled market volatility and speculation and makes the price of our Depository Receipts more stable than the price of stocks which are listed on a stock exchange. Weekly calculation of the Depository Receipt price includes any known economic expectation at that time.
Reopening facilitating of transactions
We would like to inform you that on Tuesday 13 October 8:00 hrs BST (9:00 hrs CEST) Triodos Bank N.V. will reopen trade in Depository Receipts of ordinary shares (Depository Receipts).
For UK customers, the suspension of trade only applies to the sale of existing Depository Receipts, as customers have not been able to purchase new Depository Receipts from Triodos Bank UK since February 2019.
The full prospectus with all relevant information in the documents section.