Danske Bank A/S
2–12 Holmens Kanal
DK 1092 Copenhagen K
Denmark

June 11, 2020

To the beneficial owners, or duly authorized representatives acting on behalf of beneficial owners, of its outstanding U.S.$1,500,000,000 5.000 Percent Non-Preferred Senior Notes due 2022 (the “Existing Notes”) of Danske Bank A/S (the “Bank”).

***

The Bank is undertaking a transaction with respect to the Existing Notes (the “Exchange Offer”) and is asking beneficial owners, or duly authorized representatives acting on behalf of beneficial owners, of the Existing Notes to confirm that they are either
(a) in the United States, that are “qualified institutional buyers” as defined in Rule 144A under the Securities Act (“QIBs”), in a private transaction in reliance upon an exemption from the registration requirements of the Securities Act, or
(b) outside the United States and Canada,
(i) that are persons other than “U.S. persons” as defined in Rule 902 under the Securities Act, and
(ii) if located or resident in the European Economic Area (the “EEA”) or the United Kingdom, that are persons other than “retail investors” (for these purposes, a “retail investor” means a person who is one (or more) of:
(x) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”); or
(y) a customer within the meaning of the Directive 2016/97/EU, as amended (the “Insurance Distribution Directive”), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II.
The Bank refers to holders of Existing Notes who certify to the Bank that they are eligible to participate in the Exchange Offer pursuant to at least one of the foregoing conditions as “Eligible Holders” and all other holders of such Existing Notes as “Ineligible Holders”.

Only Eligible Holders are authorized to participate in the Exchange Offer. The Exchange Offer is not available to Ineligible Holders.

I am an "Eligible Holder"

I am an "Ineligible Holder"

This letter is neither an offer with respect to the New Notes nor creates any obligations whatsoever on the part of the Bank to make any offer or on the part of the recipient to participate if an offer is made.


IN ORDER TO RECEIVE A COPY OF THE EXCHANGE OFFER DOCUMENTS, ELIGIBLE HOLDERS OR THEIR REPRESENTATIVES MUST COMPLETE THE ELIGIBILITY LETTER ATTACHED HERETO CERTIFYING THAT THEY ARE ELIGIBLE UNDER THE TERMS OF THE EXCHANGE OFFER.

COMPLETED FORMS MUST BE SUBMITTED ELECTRONICALLY OR FAXED TO THE ATTENTION OF D.F. KING & CO., INC., THE INFORMATION AGENT FOR THE OFFER. YOU MAY DIRECT ANY QUESTIONS TO D.F. KING & CO., INC., ATTN: MEI ZHENG AT 48 WALL STREET, NEW YORK, NY 10005, TELEPHONE NUMBERS: (888) 541-9895 (TOLL-FREE) OR (212) 269-5550 (COLLECT).

Very truly yours,

Danske Bank A/S

“Qualified Institutional Buyer” means:

      (1)(i)    Any of the following entities, acting for its own account or the accounts of other qualified institutional buyers, that in the aggregate owns and invests on a discretionary basis at least $100 million in securities of issuers that are not affiliated with the entity:

(a)      Any insurance company as defined in Section 2(a)(13) of the U.S. Securities Act of 1933, as amended (the “Securities Act”);

Note: A purchase by an insurance company for one or more of its separate accounts, as defined by Section 2(a)(37) of the Investment Company Act of 1940 (the “Investment Company Act”), which are neither registered under Section 8 of the Investment Company Act nor required to be so registered, shall be deemed to be a purchase for the account of such insurance company.

(b)       Any investment company registered under the Investment Company Act or any business development company as defined in Section 2(a)(48) of the Investment Company Act;

(c)       Any Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958;

(d)      Any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees;

(e)       Any employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974;

(f)       Any trust fund whose trustee is a bank or trust company and whose participants are exclusively plans of the types identified in subparagraph (i)(d) or (e) above, except trust funds that include as participants individual retirement accounts or H.R. 10 plans;

(g)      Any business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”);

(h)      Any organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, corporation (other than a bank as defined in Section 3(a)(2) of the Securities Act or a savings and loan association or other institution referenced in Section 3(a)(5)(A) of the Securities Act or a foreign bank or savings and loan association or equivalent institution), partnership, or Massachusetts or similar business trust; and

(i)        Any investment adviser registered under the Investment Advisers Act.

(ii)       Any dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), acting for its own account or the accounts of other qualified institutional buyers, that in the aggregate owns and invests on a discretionary basis at least $10 million of securities of issuers that are not affiliated with the dealer, provided, that securities constituting the whole or a part of an unsold allotment to or subscription by a dealer as a participant in a public offering shall not be deemed to be owned by such dealer;

(iii)       Any dealer registered pursuant to Section 15 of the Exchange Act acting in a riskless principal transaction on behalf of a qualified institutional buyer;

Note: A registered dealer may act as agent, on a non-discretionary basis, in a transaction with a qualified institutional buyer without itself having to be a qualified institutional buyer.

(iv)       Any investment company registered under the Investment Company Act, acting for its own account or for the accounts of other qualified institutional buyers, that is part of a family of investment companies which own in the aggregate at least $100 million in securities of issuers, other than issuers that are affiliated with the investment company or are part of such family of investment companies.  “Family of investment companies” means any two or more investment companies registered under the Investment Company Act, except for a unit investment trust whose assets consist solely of shares of one or more registered investment companies, that have the same investment adviser (or, in the case of unit investment trusts, the same depositor), provided that, for purposes of this subparagraph:

(A)      Each series of a series company (as defined in Rule 18f-2 under the Investment Company Act) shall be deemed to be a separate investment company; and

(B)       Investment companies shall be deemed to have the same adviser (or depositor) if their advisers (or depositors) are majority-owned subsidiaries of the same parent, or if one investment company's adviser (or depositor) is a majority-owned subsidiary of the other investment company's adviser (or depositor);

(v)       Any entity, all of the equity owners of which are qualified institutional buyers, acting for its own account or the accounts of other qualified institutional buyers; and

(vi)       Any bank as defined in Section 3(a)(2) of the Securities Act, any savings and loan association or other institution as referenced in Section 3(a)(5)(A) of the Securities Act, or any foreign bank or savings and loan association or equivalent institution, acting for its own account or the accounts of other qualified institutional buyers, that in the aggregate owns and invests on a discretionary basis at least $100 million in securities of issuers that are not affiliated with it and that has an audited net worth of at least $25 million as demonstrated in its latest annual financial statements, as of a date not more than 16 months preceding the date of sale under the rule in the case of a U.S. bank or savings and loan association, and not more than 18 months preceding such date of sale for a foreign bank or savings and loan association or equivalent institution.

(2)       In determining the aggregate amount of securities owned and invested on a discretionary basis by an entity, the following instruments and interests shall be excluded: bank deposit notes and certificates of deposit; loan participations; repurchase agreements; securities owned but subject to a repurchase agreement; and currency, interest rate and commodity swaps.

(3)       The aggregate value of securities owned and invested on a discretionary basis by an entity shall be the cost of such securities, except where the entity reports its securities holdings in its financial statements on the basis of their market value, and no current information with respect to the cost of those securities has been published.  In the latter event, the securities may be valued at market for purposes of this section.

(4)       In determining the aggregate amount of securities owned by an entity and invested on a discretionary basis, securities owned by subsidiaries of the entity that are consolidated with the entity in its financial statements prepared in accordance with generally accepted accounting principles may be included if the investments of such subsidiaries are managed under the direction of the entity, except that, unless the entity is a reporting company under Section 13 or 15(d) of the Exchange Act, securities owned by such subsidiaries may not be included if the entity itself is a majority-owned subsidiary that would be included in the consolidated financial statements of another enterprise.

(5)       For purposes of this section, “riskless principal transaction” means a transaction in which a dealer buys a security from any person and makes a simultaneous offsetting sale of such security to a qualified institutional buyer, including another dealer acting as riskless principal for a qualified institutional buyer.

(6)       For purposes of this section, “effective conversion premium” means the amount, expressed as a percentage of the security’s conversion value, by which the price at issuance of a convertible security exceeds its conversion value.

(7)       For purposes of this section, “effective exercise premium” means the amount, expressed as a percentage of the warrant’s exercise value, by which the sum of the price at issuance and the exercise price of a warrant exceeds its exercise value.

“U.S. person” means:

(i)       Any natural person resident in the United States;

(ii)       Any partnership or corporation organized or incorporated under the laws of the United States;

(iii)       Any estate of which any executor or administrator is a U.S. person;

(iv)       Any trust of which any trustee is a U.S. person;

(v)       Any agency or branch of a foreign entity located in the United States;

(vi)       Any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a U.S. person;

(vii)      Any discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if an individual) resident in the United States; and

(viii)       Any partnership or corporation if:

(A)        Organized or incorporated under the laws of any foreign jurisdiction; and

(B)       Formed by a U.S. person principally for the purpose of investing in securities not registered under the Securities Act of 1933, as amended (the “Securities Act”), unless it is organized or incorporated, and owned, by accredited investors (as defined in Rule 501(a) promulgated under the Securities Act) who are not natural persons, estates or trusts.

The following are not “U.S. persons”:

(ix)       Any discretionary account or similar account (other than an estate or trust) held for the benefit or account of a non-U.S. person by a dealer or other professional fiduciary organized, incorporated, or (if an individual) resident in the United States;

(x)       Any estate of which any professional fiduciary acting as executor or administrator is a U.S. person if:

(A) An executor or administrator of the estate who is not a U.S. person has sole or shared investment discretion with respect to the assets of the estate; and

(B) The estate is governed by foreign law;

(xi)       Any trust of which any professional fiduciary acting as trustee is a U.S. person, if a trustee who is not a U.S. person has sole or shared investment discretion with respect to the trust assets, and no beneficiary of the trust (and no settlor if the trust is revocable) is a U.S. person;

(xii)       An employee benefit plan established and administered in accordance with the law of a country other than the United States and customary practices and documentation of such country;

(xiii)       Any agency or branch of a U.S. person located outside the United States if:

(A)        The agency or branch operates for valid business reasons; and

(B)        The agency or branch is engaged in the business of insurance or banking and is subject to substantive insurance or banking regulation, respectively, in the jurisdiction where located; and

(xiv)        The International Monetary Fund, the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the United Nations, and their agencies, affiliates and pension plans, and any other similar international organizations, their agencies, affiliates and pension plans.

The “United States” means the United States of America, its territories and possessions, any State of the United States, and the District of Columbia.

“Qualified investors” means persons or entities that are described in points (1) to (4) of Section I of Annex II to Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (“MiFID II”) , and persons or entities who are, on request, treated as professional clients in accordance with Annex II to MiFID II , or recognised as eligible counterparties in accordance with Article 30 of MiFID II unless they have requested that they be treated as non-professional clients. Investment firms and credit institutions shall communicate their classification on request to the issuer without prejudice to the relevant legislation on data protection.

“Retail client” means a client who is not a professional client; and

“Professional client” means a client meeting the criteria laid down in Annex II to “MiFID II”, as set forth below.

ANNEX II TO MiFID II

 

PROFESSIONAL CLIENTS FOR THE PURPOSE OF THIS DIRECTIVE

 

Professional client is a client who possesses the experience, knowledge and expertise to make its own investment decisions and properly assess the risks that it incurs. In order to be considered a professional client, the client must comply with the following criteria:

 

I.    CATEGORIES OF CLIENTS WHO ARE CONSIDERED TO BE PROFESSIONALS

 

The following shall all be regarded as professionals in all investment services and activities and financial instruments for the purposes of the Directive.

 

(1)      Entities which are required to be authorised or regulated to operate in the financial markets. The list below shall be understood as including all authorised entities carrying out the characteristic activities of the entities mentioned: entities authorised by a Member State under a Directive, entities authorised or regulated by a Member State without reference to a Directive, and entities authorised or regulated by a third country:

 

(a)                   Credit institutions;

 

(b)                   Investment firms;

 

(c)                   Other authorised or regulated financial institutions;

 

(d)                   Insurance companies;

 

(e)                   Collective investment schemes and management companies of such schemes;

 

(f)                    Pension funds and management companies of such funds;

 

(g)                   Commodity and commodity derivatives dealers;

 

(h)                   Locals;

 

(i)                    Other institutional investors;

 

(2)      Large undertakings meeting two of the following size requirements on a company basis:

 

·          balance sheet total: EUR 20 000 000

 

·          net turnover: EUR 40 000 000

 

·          own funds: EUR 2 000 000

 

(3)      National and regional governments, including public bodies that manage public debt at national or regional level, Central Banks, international and supranational institutions such as the World Bank, the IMF, the ECB, the EIB and other similar international organisations.

 

(4)      Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitisation of assets or other financing transactions.

 

The entities referred to above are considered to be professionals. They must however be allowed to request non-professional treatment and investment firms may agree to provide a higher level of protection. Where the client of an investment firm is an undertaking referred to above, the investment firm must inform it prior to any provision of services that, on the basis of the information available to the investment firm, the client is deemed to be a professional client, and will be treated as such unless the investment firm and the client agree otherwise. The investment firm must also inform the customer that he can request a variation of the terms of the agreement in order to secure a higher degree of protection.

 

It is the responsibility of the client, considered to be a professional client, to ask for a higher level of protection when it deems it is unable to properly assess or manage the risks involved.

 

This higher level of protection will be provided when a client who is considered to be a professional enters into a written agreement with the investment firm to the effect that it shall not be treated as a professional for the purposes of the applicable conduct of business regime. Such agreement shall specify whether this applies to one or more particular services or transactions, or to one or more types of product or transaction.

 

II.    CLIENTS WHO MAY BE TREATED AS PROFESSIONALS ON REQUEST

 

II.1.       Identification criteria

 

Clients other than those mentioned in section I, including public sector bodies, local public authorities, municipalities and private individual investors, may also be allowed to waive some of the protections afforded by the conduct of business rules.

 

Investment firms shall therefore be allowed to treat any of those clients as professionals provided the relevant criteria and procedure mentioned below are fulfilled. Those clients shall not, however, be presumed to possess market knowledge and experience comparable to that of the categories listed in Section I.

 

Any such waiver of the protection afforded by the standard conduct of business regime shall be considered to be valid only if an adequate assessment of the expertise, experience and knowledge of the client, undertaken by the investment firm, gives reasonable assurance, in light of the nature of the transactions or services envisaged, that the client is capable of making investment decisions and understanding the risks involved.

 

The fitness test applied to managers and directors of entities licensed under Directives in the financial field could be regarded as an example of the assessment of expertise and knowledge. In the case of small entities, the person subject to that assessment shall be the person authorised to carry out transactions on behalf of the entity.

In the course of that assessment, as a minimum, two of the following criteria shall be satisfied:

 

·          the client has carried out transactions, in significant size, on the relevant market at an average frequency of 10 per quarter over the previous four quarters,

 

·          the size of the client’s financial instrument portfolio, defined as including cash deposits and financial instruments exceeds EUR 500 000,

 

·          the client works or has worked in the financial sector for at least one year in a professional position, which requires knowledge of the transactions or services envisaged.

 

Member States may adopt specific criteria for the assessment of the expertise and knowledge of municipalities and local public authorities requesting to be treated as professional clients. Those criteria can be alternative or additional to those listed in the fifth paragraph.

 

II.2.       Procedure

 

Those clients may waive the benefit of the detailed rules of conduct only where the following procedure is followed:

 

·          they must state in writing to the investment firm that they wish to be treated as a professional client, either generally or in respect of a particular investment service or transaction, or type of transaction or product,

 

·          the investment firm must give them a clear written warning of the protections and investor compensation rights they may lose,

 

·          they must state in writing, in a separate document from the contract, that they are aware of the consequences of losing such protections.

 

Before deciding to accept any request for waiver, investment firms must be required to take all reasonable steps to ensure that the client requesting to be treated as a professional client meets the relevant requirements stated in Section II.1.

 

However, if clients have already been categorised as professionals under parameters and procedures similar to those referred to above, it is not intended that their relationships with investment firms shall be affected by any new rules adopted pursuant to this Annex.

 

Firms must implement appropriate written internal policies and procedures to categorise clients.

 

Professional clients are responsible for keeping the investment firm informed about any change, which could affect their current categorisation. Should the investment firm become aware however that the client no longer fulfils the initial conditions, which made him eligible for a professional treatment, the investment firm shall take appropriate action.