Prospectus Supplement for Index Linked Notes slide image

Prospectus Supplement for Index Linked Notes

points in time, all as specified in the applicable pricing supplement. No other Index levels or values will be taken into account. For Notes that are linked to the positive performance of the Index, the return on the Notes may be negative and a purchaser of the Notes may lose substantially all of the principal of the Notes, even if the change in an Index level is positive at certain times during the term of the Notes, as the change in Index level may be negative on the day it is determined for purposes of calculating the return. For Notes that are linked to the negative performance of the Index, the reverse scenario would apply and the return on the Notes may be positive if the change in the level of the Index is negative and may be negative if the change in the level of the Index is positive. Accordingly depending on the direction of and percentage change in the level of the Index measured at one or more points in time to one or more subsequent points in time, as specified in the applicable pricing supplement, the return on the Notes may be negative and a purchaser of the Notes may lose substantially all of the principal of the Notes. In addition, if the return on the Notes is based on the performance of more than one Index, the level of one or more Indices could increase or decrease over the term of the Notes, but be offset or negated by decreases or increases in the levels of the other Indices, as the case may be. Any payment due and payable on the Notes on a date that is not a Business Day (as defined below) will be postponed until the immediately following Business Day, subject to the occurrence of a Market Disruption Event or an Extraordinary Event. Principal at Risk Notes The Notes do not guarantee the repayment of any amount of the principal, subject to the minimum principal repayment as may be specified in the applicable pricing supplement. The applicable pricing supplement for the Notes will specify the amount of the principal of the Notes that is "protected", which amount may be as little as 1% of the principal amount of such Notes. Notes in respect of which the minimum principal repayment by the Bank will be an amount in excess of 1% of the principal are referred to as "partially principal protected notes". All other Notes are "non-protected notes", which means that all but 1% of the principal amount of such Notes will be fully exposed and investors could lose substantially all of their investment subject to the minimum principal repayment of 1% of the principal amount of such Notes, or $1.00 per Note. See "Description of the Notes - Principal at Risk" in the Prospectus. Return of Capital Notes If specified in the relevant pricing supplement, some or all of the principal of the Notes may be repaid to purchasers in instalments over the term of the Notes and such Notes are referred to as "return of capital" Notes or "ROC Notes". Instalment payments of principal made over the term of ROC Notes reduce the outstanding principal payable at or prior to maturity. ROC Notes may be partially principal protected notes or non-protected notes, as specified in the applicable pricing supplement. Special Circumstances The following terms, conditions and definitions, subject to completion and amendment and as supplemented or varied as specified in the applicable pricing supplement, will be applicable to index linked Notes and for greater certainty these provisions regarding special circumstances shall be read with the necessary modifications to also apply to a Target Index in the same manner in which such provisions apply to an Index. The applicable pricing supplement in relation to any particular Notes offering may specify other terms, conditions and definitions which will, to the extent so specified or to the extent inconsistent with the following conditions, replace or modify the following for the purposes of such Notes. Determinations of the Calculation Agent All calculations and determinations in respect of the Notes made by the Calculation Agent will, absent manifest error, be final and binding on the holders of Notes and will be made in the Calculation Agent's sole and absolute discretion. In certain circumstances, the Bank will appoint one or more independent PROD-SUP-ILN-4
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