Gruppo bancario Credito Valtellinese

Bond issue "Credito Valtellinese 2% 1999-2004, Index-Linked, Convertible, Cum Warrant, Subordinated"
(code ISIN IT0001300315)
Maturity date for third periodic payment: fixed amount of redemption premium

A notice which was published in the Italian daily newspaper Il Sole 24 Ore on January 7, 2004, reported end of maturity period for third periodic payment for bond issue 'Credito Valtellinese 2% 1999-2004, Index-Linked, Convertible, Cum Warrant, Subordinated'.

Below are the main characteristics of this bond issue:

until February 14, 2004, each periodic payment, which amounts to 400 euros per bond (nominal value is 1,000 euros), entitles the bond holder to convert 200 euros into 29 new shares of Credito Valtellinese. Conversion value is 6.90 euros per share, of which 3 euros will be taken as nominal value and the remaining amount (3.90 euros) as paid-in surplus;
bond holders exercising the power of conversion are receiving the other half of the payment, namely 200 euros, under the form of a redemption premium linked to the performance of financial indicators. (1)

In conformity with the revaluation of the above-mentioned financial indices according to the bond issue regulations, the redemption price has been fixed in 104.41925 euros every 100 euros of the loan capital. Bond holders will receive 208.8385 euros for each redeemable tranche of 200 euros before retentions provided for by the law.

The bond holders who are not exercising the power of conversion will receive the whole amount of the periodic payment on the basis of the nominal value.

(1) In particular, article 4 reads that for the periodic payment due on February 15, 2004, the redemption premium will be equal to 70 percent of the progressive monthly average revaluation, calculated with respect to the emission date (February 15, 1999), of a basket of stock market indices consisting of the "S&P 500" (New York Stock Exchange) for 50% and "Nikkei 225" (Tokyo Stock Exchange) for the other 50%; the progressive average is calculated on the basis of the value of the above-mentioned indices in the 60 official closes of New York and Tokyo Stock Exchanges. Starting from March 15, 1999, the value of the indices will be assessed on the 15th of each month or, if a holiday falls on the 15th, on the subsequent working day, except for last maturity date, for which the close of February 2, 2004 will be considered.