Pricing
Sheet –
January 3,
2008
10.60%
(PER
ANNUM),
”THE
SPDR
TRUST
SERIES
1” ONE
YEAR
KNOCK-IN
REXSMSECURITIES
DUE
JANUARY
9,
2009
|
SUMMARY
INFORMATION
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|
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Issuer:
|
ABN
AMRO Bank N.V.
(Senior Long Term
Debt Rating: Moody’s
Aa2, S&P
AA-)
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Lead
Agent:
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ABN
AMRO
Incorporated
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|
Offerings:
|
10.60%
(Per Annum), One Year
Reverse Exchangeable Securities due January 9, 2009 linked to the
Underlying Fund set forth in the table below.
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Interest
Payment
Dates:
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Interest
on the Securities is
payable monthly in arrears on the 10th
day of each month starting on
February 10, 2008 and ending on the Maturity
Date.
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|
Underlying
Fund
|
Ticker
|
Coupon
Rate
Per
annum
|
Interest
Rate
|
Put
Premium
|
Knock-in
Level
|
CUSIP
|
ISIN
|
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The
SPDR Trust Series
1
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SPY
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10.60%
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4.09%
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6.51%
|
70%
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00078U4Q0
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US00078U4Q01
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Denomination/Principal:
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$1,000
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Issue
Size:
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USD
1,000,000
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Issue
Price:
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100%
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|
Payment
at
Maturity:
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The
payment at maturity for each
Security is based on the performance of the Underlying Fund linked
to such
Security:
i)
If the closing price of the Underlying Fund on the primary U.S.
exchange
or market for such Underlying Fund has not fallen below the Knock-In
Level on any trading day
from but not including the Pricing Date to and including the Determination
Date, we will pay you the principal amount of each Security in
cash.
ii)
If
the
closing price of the Underlying Fund on the primary U.S. exchange
or
market for such Underlying Fund
has fallen below the Knock-In Level on any trading day from but
not
including the Pricing Date to and including the Determination Date:
a)
we
will
deliver to you a number of shares of the Underlying Fund equal
to the
Redemption
Amount, in the event that the
closing price of the Underlying Fund on the Determination Date
is below
the Initial Price; or
b)
We
will pay
you the principal amount of each Security in cash, in the event
that the
closing price of the Underlying Fund on
the Determination Date is at or
above the Initial Price.
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|
Initial
Price:
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USD
145.42 (100% of
the Intraday Price per Underlying Share on the Trade
Date)
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Redemption
Amount:
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6.877
shares
of the Underlying Fund per $1,000 principal amount of Securities
(Denomination divided by the Initial Price)
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Knock-In
Level:
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101.79
USD (70% of the Initial
Price)
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Indicative
Secondary
Pricing:
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• Internet
at: www.s-notes.com
• Bloomberg
at: REXS2 <GO>
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Status:
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Unsecured,
unsubordinated
obligations of the Issuer
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Trustee:
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Wilmington
Trust
Company
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Securities
Administrator:
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Citibank,
N.A.
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Settlement:
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DTC,
Book Entry,
Transferable
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Selling
Restrictions:
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Sales
in the European Union must
comply with the Prospectus Directive
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Pricing
Date:
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January
3, 2008 subject to certain
adjustments as described in the related pricing
supplement
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Settlement
Date:
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January
10,
2008
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Determination
Date:
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January
6, 2009 subject
to certain adjustments
as described in the related pricing supplement
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Maturity
Date:
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January
9 , 2009 (One
Year)
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ABN
AMRO has
filed a registration statement (including a Prospectus and Prospectus
Supplement) with the SEC for the offering to which this communication relates.
Before you invest, you should read the Prospectus and Prospectus Supplement
in
that registration statement and other
documents ABN AMRO has filed with the SEC for more complete information about
ABN AMRO and the offering of the Securities.
You
may get
these documents for free by visiting EDGAR on the SEC website at
<www.sec.gov> or by visiting ABN AMRO Holding N.V. on the SEC website at
<http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=abn&filenum=&State=&SIC=&owner=include&action=getcompany>.
Alternatively, ABN AMRO, any underwriter or any dealer participating in
the
offering will arrange to send you the Prospectus and Prospectus Supplement
if
you request it by calling toll free (888) 644-2048.
These
Securities may not be offered or sold (i) to any person/entity listed on
sanctions lists of the European Union, United States or any other applicable
local competent authority; (ii) within the territory of Cuba, Sudan, Iran
and
Myanmar; (iii) to residents in Cuba, Sudan, Iran or Myanmar; or (iv) to Cuban
Nationals, wherever located.
We
expect
that delivery of the Securities will be made against payment therefor on
or
about the closing date specified on the cover page of this pricing sheet,
which
will be the fifth Business Day following the Pricing Date of the Securities
(this settlement cycle being referred to as “T+5”). Under Rule 15c6-1 of the SEC
under the Securities Exchange Act of 1934, trades in the secondary market
generally are required to settle in three Business Days, unless the parties
to
that trade expressly agree otherwise. Accordingly, purchasers who wish to
trade
the Securities on the Pricing Date or the next succeeding Business Day will
be
required, by virtue of the fact that the Securities initially will settle
in
T+5, to specify an alternate settlement cycle at the time of any such trade
to
prevent a failed settlement and should consult their own
advisor.
SUMMARY
The
following
summary does not contain all the information that may be important to you.
You
should read this summary together with the more detailed information that
is
contained in the related Pricing Supplement and in its accompanying Prospectus
and Prospectus Supplement. You should carefully consider, among other things,
the matters set forth in “Risk Factors” in the related Pricing Supplement, which
are summarized on page 5 of this document. In addition, we urge you
to consult with your investment, legal, accounting, tax and other advisors
with
respect to any investment in the Securities.
What
are the
Securities?
The
Securities are
interest paying, non-principal protected securities issued by us, ABN AMRO
Bank
N.V., and are fully and unconditionally guaranteed by our parent company,
ABN
AMRO Holding N.V. The Securities are senior notes of ABN AMRO Bank N.V. These
Securities combine certain features of debt and equity by offering a fixed
interest rate on the principal amount while the payment at maturity is
determined based on the performance of the Underlying Fund to which it is
linked.
What
will I
receive at maturity of the Securities?
If
the closing price
of the Underlying Fund linked to a Security on the relevant exchange has
not
fallen below the Knock-In Level on any trading day from but not including
the
Pricing Date to and including the Determination Date (such period, the “Knock-In
Period”), at maturity we will pay you the principal amount of such Security in
cash.
If,
on the other
hand, the closing price of the Underlying Fund on the relevant exchange has
fallen below the Knock-In Level on any trading day during the Knock-In Period,
at maturity we will either:
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|
•
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deliver
to you
a fixed number of shares of such Underlying Fund, which we call
the
Redemption Amount, in exchange for such Security, in the event
that the
closing price of such Underlying Fund is below the Initial Price
on the
Determination Date; or
|
|
|
•
|
pay
you the principal amount of such Security in cash, in the event
that the
closing price of such Underlying Fund is at or above the Initial
Price on
the Determination Date.
|
Why
is the
interest rate on the Securities higher than the interest rate payable on
your
conventional debt securities with the same maturity?
The
Securities offer
a higher interest rate than the yield that would be payable on a conventional
debt security with the same maturity issued by us or an issuer with a comparable
credit rating. This is because you, the investor in the Securities, indirectly
sell a put option to us on the shares of the Underlying Fund. The premium
due to
you for this put option is combined with a market interest rate on our senior
debt to produce the higher interest rate on the Securities.
What
are the
consequences of the indirect put option that I have sold
you?
The
put option you
indirectly sell to us creates the feature of exchangeability. If the closing
price of the Underlying Fund on the relevant exchange falls below the Knock-In
Level on any trading day during the Knock-In Period, and on the Determination
Date the closing price of the Underlying Fund is less than the Initial Price,
you will receive the Redemption Amount. The market value of the shares
of such Underlying Fund at the time you receive those shares will be less
than
the principal amount of the Securities and could be zero. Therefore you are
not
guaranteed to receive any return of principal at maturity.
How
is the
Redemption Amount determined?
The
Redemption
Amount for each $1,000 principal amount of the Securities is equal to $1,000
divided by the initial price. Since shares of the Underlying Fund are held
in
book entry form, no stock certificates are issued. Accordingly, any
shares of the Underlying Fund which are delivered to you will be delivered
in
book entry form and will include any fractional shares you are entitled to
receive, after aggregating your total holdings of the Securities based on
the
closing price of the Underlying Fund on the determination date.
What
interest payments can I expect on the Securities?
The
interest rate is
fixed at issue and is payable in cash on each interest payment date,
irrespective of whether the Securities are redeemed at maturity for cash
or
shares.
Can
you give
me an example of the payment at maturity?
If,
for example, in
a hypothetical offering, the interest rate was 10% per annum, the initial
price
of the underlying fund was $145.00 per share and the knock-in level for such
offering was 80% then the knock-in level would be $116.00 per share or 80%
of
the initial price and the redemption amount would be 6.897 shares of the
underlying fund, or $1,000 divided by $145.00.
If
the hypothetical
closing price of that underlying fund had fallen below its knock-in level
of
$116.00 on any trading day during the Knock-in Period, then payment at maturity
would depend on the closing price of the underlying fund on the determination
date. In this case, if the closing price of the underlying fund on the
determination date is $136.00 per share, which is below the initial price,
you
would receive 6.897 shares of the underlying fund for each $1,000 principal
amount of the securities. Since shares of the underlying fund are
held in book entry form we would deliver shares of the underlying fund in
book
entry form which allows us to deliver fractions of
a
share. You would receive on the maturity date for each $1,000
principal amount of the securities 6.897 shares of the underlying. In addition,
over the life of the securities you would have received interest payments
at a
rate of 10% per annum.
In
this
hypothetical example, the market value of those 6.897 shares of the underlying
fund that we would deliver to you at maturity for each $1,000 principal amount
of security would be $937.99, which is less than the principal amount of
$1,000,
and you would have lost a portion of your initial
investment.
If,
on the other
hand, the closing price of the underlying fund on the determination date
is
$150.00 per share, which is above the initial price level, you will receive
$1,000 in cash for each $1,000 principal amount of the securities regardless
of
the knock-in level having been breached. In addition, over the life of the
Securities you would have received interest payments at a rate of 10% per
annum.
Alternatively,
if
the closing price of the underlying fund never falls below $116.00, which
is the
knock-in price on any trading day during the Knock-in Period, at maturity
you
would receive $1,000 in cash for each $1,000 principal amount of the Securities
you hold regardless of the closing price of the underlying fund on the
determination date. In addition, over the life of the Securities you would
have
received interest payments of 10% per annum.
This
example
is for illustrative purposes only and is based on a hypothetical
offering. It is not possible to predict the closing price of any of
the Underlying Funds on the determination date or at any time during the
life of
the Securities. For each offering, we will set the Initial Price,
Knock-In Level and Redemption Amount on the Pricing Date.
Do
I benefit
from any appreciation in the Underlying Fund over the life of the
Securities?
No.
The amount paid
at maturity for each $1,000 principal amount of the Securities will not exceed
$1,000.
What
if I
have more questions?
You
should read
“Description of Securities” in the related Pricing Supplement for a detailed
description of the terms of the Securities. ABN AMRO has filed a
registration statement (including a Prospectus and Prospectus Supplement)
with
the SEC for the offering to which this communication relates. Before you
invest,
you should read the Prospectus and Prospectus Supplement in that registration
statement and other documents ABN AMRO has filed with the SEC for more complete
information about ABN AMRO and the offering of the Securities. You
may get these documents for free by visiting EDGAR on the SEC web site at
www.sec.gov. Alternatively, ABN AMRO, any underwriter or any dealer
participating in the offering will arrange to send you the Prospectus and
Prospectus Supplement if you request it by calling toll free (888)
644-2048.
RISK
FACTORS
Investors
should carefully consider the risks of the Securities to which this
communication relates and whether these Securities are suited to their
particular circumstances before deciding to purchase them. It is
important that prior to investing in these Securities investors read the
Pricing
Supplement related to such Securities and the accompanying Prospectus and
Prospectus Supplement to understand the actual terms of and the risks associated
with the Securities. In addition, we urge investors to consult with
their investment, legal, accounting, tax and other advisors with respect
to any
investment in the Securities.
Credit
Risk
The
Securities are issued by ABN AMRO
Bank N.V. and guaranteed by ABN AMRO Holding N.V., ABN AMRO’s
parent. As a result,
investors assume the credit risk of ABN AMRO Bank N.V. and that of ABN AMRO
Holding N.V. in the event that ABN AMRO defaults on its obligations
under the
Securities. Any obligations or Securities sold, offered, or
recommended are not deposits on ABN AMRO Bank N.V. and are not endorsed or
guaranteed by any bank or thrift, nor are they insured by the FDIC or any
governmental agency.
Principal
Risk
The
Securities are not ordinary debt
securities: they are not principal protected. In addition, if the
closing price of the Underlying Fund falls below the Knock-In Level on any
trading day during the Knock-In Period, investors in the Securities will be exposed
to any decline
in the price of the Underlying Fund below the closing price of such Underlying
Fund on the date the Securities were priced.
Accordingly,
investors may lose some or
all of their initial principal investment in the Securities.
Limited
Return
The
amount payable under the Securities
will never exceed the original principal amount of the Securities plus the
aggregate fixed coupon payment investors earn during the term of the
Securities. This means that investors will not benefit from any
price appreciation
in the Underlying Fund, nor will they receive dividends paid on the Underlying
Fund, if any. Accordingly, investors will never receive at maturity
an amount greater than a predetermined amount per Security, regardless
of how much the price of the
Underlying Fund increases during the term of the Securities or on the
Determination Date. The return of a Security may be significantly
less than the return of a direct investment in the Underlying Fund to which
the
Security
is linked during the term of the
Security.
Liquidity
Risk
ABN
AMRO does not intend to list the
Securities on any securities exchange. Accordingly, there may be
little or no secondary market for the Securities and information regarding
independent market pricing
of the Securities may be limited. The value of the Securities in the secondary
market, if any, will be subject to many unpredictable factors, including
then
prevailing market conditions.
It
is important to note that
many factors will contribute to
the secondary market value of
the Securities, and investors may not receive their full principal back if
the
Securities are sold prior to maturity. Such factors
include, but are not
limited to, time to maturity, the price of the Underlying Fund,
volatility and interest
rates.
In
addition, the price, if any, at which
we or another party are willing to purchase Securities in secondary market
transactions will likely be lower than the issue price, since the issue price
included, and secondary market prices are likely to exclude,
commissions,
discounts or mark-ups paid with respect to the Securities, as well as the
cost
of hedging our obligations under the Securities.
Tax
Risk
Pursuant
to the terms of the Knock-in
Reverse Exchangeable Securities, we and every investor agree
to characterize the
Securities as consisting of a Put Option and a Deposit of cash with the
issuer. Under this characterization, a portion of the stated interest
payments on each Security is treated as interest on the Deposit, and
the remainder
is treated as attributable to
a sale by the investor of the Put Option to ABN AMRO (referred to as Put
Premium). Receipt of the Put Premium will not be taxable upon
receipt.
If
the Put Option expires unexercised
(i.e., a cash payment of the principal amount of
the Securities is
made to the investor at maturity), the investor will recognize short-term
capital gain equal to the total Put Premium received. If the Put
Option is exercised (i.e., the final payment on the Securities is paid in
the
Underlying
Fund), the investor will not
recognize any gain or loss in respect of the Put Option, but the
investor’s
tax basis in the Underlying Fund
received will be reduced by the Put Premium received.
Significant
aspects of the U.S.
federal income tax treatment of the Securities
are uncertain,
and no assurance can be given that the Internal Revenue Service will accept,
or
a court will uphold, the tax treatment described above.
This
summary is limited to the federal
tax issues addressed herein. Additional issues may exist that
are not addressed
in this summary and that could affect the federal tax treatment of the
transaction. This tax summary was written in connection with the
promotion or marketing by ABN AMRO Bank N.V. and the placement agent of the
Knock-in
Reverse Exchangeable Securities,
and it cannot be used by any investor for the purpose of avoiding penalties
that
may be asserted against the investor under the Internal Revenue
Code.
Investors
should seek their own advice
based on their particular
circumstances from an independent tax advisor.
Reverse
Exchangeable is a Service Mark
of ABN AMRO Bank N.V.