SPECIAL HOUSING LOAN OFFER for AUB staff May For questions please contact Maya Kambris on

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1 SPECIAL HOUSING LOAN OFFER for AUB staff May 2011 For questions please contact Maya Kambris on

2 Our Offer at a glance HSBC offers AUB staff a very attractive rate 1 st year interest rate: 3.99% Interest rate 2 nd year onwards: 1 year USD LIBOR +3.25%, LIBOR is currently at 0.79%) Flexibility to fully/ partially close the loan starting day 2 No file fees HSBC is the only bank offering an Equity Release Loan Possibility to top-up the loan Down payment starting at 15% Debt Burden ratio up to 60%

3 HSBC Your trusted partner We understand the importance of providing home financing solutions that meet your specific requirements We are committed to full transparency and fair dealings with you and understand first your needs and then will agree with you on the most appropriate solution We have dedicated staff that will guide and support you through the process of this important and critical stage in your life HSBC offers the widest range of solutions with key benefits that enable you not only to enjoy the most attractive pricing but also maintain financial flexibility over the life of the loan as we do understand that things in your life will change.

4 A long lasting and valuable relationship HSBC serves more than 1,000 staff at AUB and has been the key banker for them AUB is one of the selected companies with the best pricing and dedicated service out from Ras Beirut Branch HSBC is keen to develop the relationship further and offer AUB staff compelling home finance solution leveraging its global expertise in its domain.

5 We can t help you to find the right house, however we can help you to find the right financing solution Choose 1 2 or a combination* Your Home Loan Solutions Home Loan You want to own your first home and secure a long term investment? Re-finance (Buyout) Are you looking to refinance your existing home loan and save on your monthly payments? Equity Release Loan (ERL) Are you even looking to get cash against your property to expand your life style? * In case of Re-finance with cash out element Equity Release rates and terms & conditions apply. Your repayment method Fixed equal monthly instalments Variable instalments with fixed tenure Picture

6 Our products key features offer maximum benefits for you Enjoy Attractive and transparent pricing 3.99% fixed for 1 st year for Home Loan and Buy-out (ERL at 4.99%) LIBOR +3.25% from 2 nd year onwards for full tenure up to 20 years - currently at 4.04%* (ERL rate at LIBOR % currently at 5.04%*) LIBOR based pricing historically lower and less volatile than local benchmark rates No Minimum Rate for the life of the loan No file fees No hidden fees * As of May 23 rd LIBOR subject to change. For actual rates please contact your mortgage advisor.

7 Our products key features offer maximum benefits for you Enjoy Financial flexibility Tenure up to 20 years No Lock-in period allowing partial or full early repayments at any time No salary domiciliation required Loan amount can go as high as the salary permits* Debt Burden ratio can go up to 60% of the income** Financing up to 85%*** of price for Home Loan and Re-Finance (Up to 60% for ERL) Option of Top-Up Loan when LTV <=60% A free and pre-approved credit card * Loan to Value not to exceed 85% & total monthly installments should not exceed 60%** of total income ** Debt Burden ratio can go up to 50% if salary less than USD 5,000 and up to 60% if salary above USD 5,000 *** Terms and Conditions apply

8 Product Details - Summary All products are USD based Benchmark 1 year LIBOR Home Loan Re-finance (Buyout) Use of funds Purchase of finished property Buyout outstanding balance of existing home loan Max. Tenure Max. loan value of property value (LTV) Repayment Method Up to 20 years tenure Equity Release Loan Borrow an amount based on the worth of an existing property Up to 85% Up to 85% Up to 60% Monthly fixed or variable monthly instalments DBR (Debt Burn Ratio) Debt Burden ratio can go up to 50% if salary less than $5,000 and up to 60% if salary above $5,000 File fees Early repayment (Full or partial) Insurance Waived Possible at any time with 1% fee of outstanding loan amount Life Insurance covering the loan amount provided by AXA in favor of HSBC or endorse the current Life Insurance provided by AUB * Lock-in period Repayment channel Fire Insurance** None Internet Banking, ATM, Libanpost and in Branches * Subject to AXA acceptance or endorsing the AUB staff insurance in favor of HSBC ** Might be subject to change of terms and conditions and/ or increase of the insured sum

9 Example calculation Home loan of USD 700,000 over 20 years 1 st year: Interest rate: 3.99% Monthly payment: USD 4,239 2 nd year onwards: Interest rate: 1 year USD LIBOR +3.25% Monthly payment: USD 4,256* *Monthly payment s calculation is based on the current 1 year USD LIBOR (currently at 0.79%) as of May 23 rd. The actual monthly instalment thus might be different if LIBOR changes and/or depending on the repayment method chosen. Our mortgage advisor will help you understand your repayment amount over the life of the loan with the repayment options we offer.

10 Documents and guarantees required Personal Documents Employment Letter (original) Copy of Lebanese I.D, If Lebanese (or copy of Passport) Last 3 months bank Statement Copy of Syndicate membership Card (If available) Property documents Real Estate Certificate for the section (The considered property) Copy of Title Deed Sales Contract after initial approval Real Estate Certificates for the sections 1 and 3 Residency License Blue Map The by-law of Joint Ownership Housing Loan guarantees First degree mortgage* amounting 100% of the loan amount Life Insurance** covering the loan amount or Endorse* the current Life Insurance provided by AUB *** Fire Insurance** In favor of HSBC ** Life insurance with AXA in favor of HSBC *** Might be subject to change of terms and conditions and/ or increase of the insured sum

11 HSBC, as your trusted partner, will support and guide you in choosing your right home loan solution. Talk to one of our mortgage experts today. Your contact person: Maya Kambris - Home Loan Sales Manager Call us at us: maya.kambris@hsbc.com Visit us in one of our branches

12 Background on HSBC

13 HSBC background information Widespread international network International network with 8,800 offices in 86 countries Uniquely cosmopolitan customer base Offering outstanding customer services Global scale and local knowledge Best-practise and advanced technology Considerable Financial Strength Rated Aa3 by Moody s Investors Service* * Rating relates to HBME

14 HSBC in Lebanon - Committed over 60 years In Lebanon: St. Georges Bay Dora Ras Beirut Verdun Zouk Mikayel Ashrafieh Dedicated NRL Services:

15 Best Place to Bank Banking everywhere made easy Express Banking Superior ATM functionality Bulk Cash Deposit Machines Free Best-in Class Internet Banking Free Phone Banking 24/7

16 Appendix

17 Banking jargon explained DBR (Debt Burn Ratio) Equity Release Loan (=ERL) Fixed equal monthly instalments (EMI) Indicative Rate LIBOR LTV (Loan to Value Ratio) This ratio calculates the maximum amount loan value based upon your salary. Other current financial obligations are taken into account. For illustrative purposes DBR is calculated as monthly instalments/monthly salary. For exact calculation please contact one of our mortgage advisors. Loan against existing property for use of funds for instance to be used for refurbishment, purchase of 2nd home or other expenses. Equal monthly instalments over the life of the loan. As we anticipate changes in the LIBOR we recommend a repayment schedule on the indicative rate to ensure that the agreed tenure is not extended. The true costs for you of the loan however are calculated over LIBOR + Spread of 3.25% meaning if the LIBOR + Spread are below the indicative rate your loan will be paid down before the original maturity date. The interest rate recommended by HSBC Lebanon for the fixed equal monthly instalments. The true interest rate will be below the indicate rate, however the indicative rate reduces the risk for you to go beyond the original tenure of the loan in case LIBOR rates increase. LIBOR is an acronym for London Inter-Bank Offered Rate. LIBOR is a reference rate for the international banking markets and is commonly the basis on which lending margins are fixed. Thus, an original loan agreement or a rescheduling agreement may set the interest rate to the borrower at six-month dollar LIBOR plus 1.5 percent, with semiannual adjustments for changes in the LIBOR rate. The ratio of the fair market value of an asset to the value of the loan that will finance the purchase. Re-finance (=Buyout) At HSBC we refer to a Buyout of an existing HML (outstanding balance) as Re-finance. In case you require additional cash above the outstanding balance you can apply for an Equity Release Loan. Variable monthly instalments The variable monthly installment home finance solution are based on the 1 year USD LIBOR. At each anniversary of the loan the average of the 1 year USD LIBOR for the previous quarter is calculated and forms the base for the monthly instalments that are accordingly adjusted each year if LIBOR changes. You will be informed and need to confirm on an annual base about the new monthly instalment valid for the successive year.

18 Our Offer versus the local market HSBC Market Purpose Interest Rate Flexibility Acquire a prime residence, buy out an existing home loan or free-up cash by mortgaging an already existing property 3.99% for the first year, then 1 year USD LIBOR % till the 20 th year currently at 4.04% -Possibility to pay the loan (fully/ partially) starting day 2 of the loan drawdown -Choice between fixed and variable monthly payments Debt Burden Ratio Can go up to 60% 33% Acquire a prime residence 3.5% for the first year, then 1 Year Treasury bills or + 3% till the 15th year currently at 4.42% or 4.92% Treasury Bill 3 years rate + 3% currently at 8.94% -Impossibility to pay off the loan (fully/ partially) before year 7 (All LBP subsided loans) - Monthly payments are variable from year to year Mortgage Amount 100% of the Loan Amount 120% of the Loan Amount Revolving Card Free & Pre approved 75$ / year E-Banking & Call Center Free 1$ to 3$ / month Source: Website of Lebanese local banks

19 Comparison of 12 months USD Libor vs. 12 months LB Treasury Bill 12 mo Treasury Bill Yield 12 mo USD Libor /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/ /09/ /01/ /05/2010 Source: Banque Du Liban

20 Disclaimer: Certain information in this presentation have been prepared and presented by The Hong Kong and Shanghai Banking Corporation Limited ("the Bank") based on information obtained from sources it believes to be reliable but which it has not independently verified. Whilst every care has been taken in preparing such information, the Bank makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Except as specifically indicated, the expressions of opinion are those of the Bank only and are subject to change without notice. Copyright. The Hong Kong and Shanghai Banking Corporation Limited All rights reserved. No part of this presentation may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of The Hong Kong and Shanghai Banking Corporation Limited. Issued by HSBC Bank Middle East Limited, P O Box Beirut,Lebanon, which is incorporated in Jersey, Channel Islands and is regulated by the Jersey Financial Services Commission to carry on banking and deposit-taking business under the Banking Business (Jersey) Law 1991, and to carry on investment and fund services business under the Financial Services (Jersey) Law Accounts, facilities and services are subject to the Bank's terms and conditions. HSBC Bank Middle East Limited Lebanon Branch is regulated by the Central Bank of Lebanon. This material is directed at wholesale customers whom HSBC Bank Middle East Limited is satisfied meet the regulatory criteria of a Client under the Central Bank of Lebanon rules.