22 Mar 2016 07:21
BANK AUDI S.A.L.
Bab Idriss - Omar Daouk StreetBank Audi Plaza, P.O. Box 11-2560Beirut - Lebanon
INFORMATION STATEMENT
March 22, 2016
Dear Global Depositary Receipt Holder:
Reference is hereby made to the Amended and Restated Deposit Agreement dated May 10, 2010 (as may be amended from time to time, the "Deposit Agreement") between Bank Audi s.a.l. (the "Bank")) and Deutsche Bank Trust Company Americas, in its capacity as depositary (the "Depositary"), relating to Global Depositary Receipts issued in respect of common shares of the Bank (the "GDRs"), each GDR representing one common share, nominal value L.L. 1,656 per common share (the "Common Shares"). Capitalized terms used herein without otherwise being defined shall have the respective meanings assigned thereto in the Deposit Agreement.
The Depositary, as the shareholder of record of Common Shares evidenced by GDRs, has received notice of the Ordinary General Meeting of the Shareholders of the Bank to be held on April 8, 2016 (the "General Meeting"), at the Bank's head office in Beirut, which (among other things) sets forth the agenda for such General Meeting. References in this Information Statement (this "Information Statement") to the "Holder" of any GDR shall mean the person registered as the holder of such GDR on the books of the Depositary. In accordance with Clause 13 of the Deposit Agreement and Condition 23 of the GDRs, a copy of such notice and agenda is being sent hereby to each person who is a Holder on March 22, 2016, which is the record date (the "Record Date") established by the Depositary for this purpose (which is as near as practicable to April 7, 2016, being the corresponding record date set by the Bank in respect of the General Meeting).
As set forth in such notice, at the General Meeting, shareholders of the Bank, including the Depositary, will be asked to consider and vote upon the following agenda:
1. To approve the Bank's accounts, in particular, the balance sheet and the profit and loss statement, as of and for the year ended December 31, 2015, and to discharge the Chairman and members of the Board of Directors of the Bank (the "Board of Directors" or the "Board") in respect of activities performed during the year ended December 31, 2015;
2. To appropriate the 2015 profits in accordance with the proposal of the Board of Directors;
3. To declare distributions to the holders of the Bank's preferred shares and dividends to the holders of Common Shares and determine the related record and payment dates;
4. To ratify loans granted during the year 2015 to related parties as per Article 152 of the Code of Money and Credit;
5. To authorise the granting of loans to related parties during the year 2016, in accordance with Article 152 of the Code of Money and Credit;
6. To ratify transactions that are subject to the approval of the General Meeting including transactions entered into between the Bank and members of the Board of Directors or affiliated companies during the year ended December 31, 2015 that are subject to Article 158 of the Code of Commerce and to authorise the Bank to enter into similar transactions during the year 2016;
7. To elect a new Board of Directors and to determine the remuneration of its members;
8. To confirm the managerial responsibilities of certain Board members and to determine their fixed and performance-related remuneration in respect of such responsibilities;
9. To authorise the participation of certain Board members in the boards of other companies and to grant the necessary related authorisations pursuant to Article 159 of the Code of Commerce; and
10. To appoint External Auditors for the coming 3 years and to determine their fees for the year 2016.
Each Holder is hereby requested to return to the Depositary voting instructions, as provided in this Information Statement, by which such Holder may give instructions to the Depositary to vote for or against each and any resolution specified in such agenda.
After careful consideration, the Board of Directors recommends a vote in favour of each such resolution.
Yours very truly,
Raymond Audi
Chairman - General Manager
INFORMATION STATEMENT
Table of Contents
Page
Available Information.......................................................................................................................................................... 3
Voting Rights of Holders..................................................................................................................................................... 3
Summary Background Information.................................................................................................................................... 3
Voting Instructions.............................................................................................................................................................. 8
Information regarding Bank Audi s.a.l.............................................................................................................................. 9
AVAILABLE INFORMATION
No person has been authorized to give any information or to make any representation other than those contained in this Information Statement, and, if given or made, such information or representation must not be relied upon as having been authorised by the Bank. No delivery of this Information Statement nor any offer or distribution of any securities to which this Information Statement relates shall, under any circumstances, create any implication that there has been no change in the affairs of the Bank since the date of this Information Statement or that any information contained or referred to herein is correct as of any time subsequent to the date as of which it is given. This Information Statement does not constitute the solicitation of a proxy to or from any person in any jurisdiction to or from whom it is unlawful to make such offer or solicitation within such jurisdiction.
VOTING RIGHTS OF HOLDERS
In accordance with Condition 12 of the GDRs, the Depositary is seeking voting instructions from the Holders in order to exercise or cause to be exercised the voting rights in respect of the Deposited Shares as directed by such voting instructions to the extent permitted by Lebanese Law.
Common Shares which have been withdrawn from the deposit facility under the Deposit Agreement and transferred on the Bank's register of members to a person other than the Depositary or its nominee may be voted by the registered owner thereof; however, Holders may not receive sufficient advance notice of the General Meeting to enable them to withdraw Deposited Shares and vote at the General Meeting.
SUMMARY BACKGROUND INFORMATION
On January 28, 2016, the Bank released its annual unaudited consolidated financial statements as of and for the year ended December 31, 2015.
On March 21, 2016, the Board of Directors,
(i) Having examined the draft External Auditors report to the General Meeting in connection with the financial statements as of and for the year ended December 31, 2015, encompassing the External Auditors unqualified opinion, and having approved such financial statements;
(ii) Having adopted the 2015 Annual Report encompassing the "Management Discussion and Analysis", which summarises the Bank's activity during the year ended December 31, 2015 (and its major financial indicators), as well as the major developments in the local and regional economies and the Bank's market positioning and strategic choices;
(iii) Having adopted a proposal for the appropriation of the profits realized by the Bank for the year ended December 31, 2015 to be submitted to the General Meeting, such proposal encompassing amongst other things, (w) the distribution to holders of Series "F" Preferred Shares (in accordance with their terms) of USD 6 per Series "F" Preferred Share (aggregating LL 13,568 million (USD 9 million)), (x) the distribution to holders of Series "G" Preferred Shares (in accordance with their terms) of USD 6 per Series "G" Preferred Share (aggregating LL 13,568 million (USD 9 million)), (y) the distribution to holders of Series "H" Preferred Shares (in accordance with their terms) of USD 6.5 per Series "H" Preferred Share (aggregating LL 7,349 million (USD 4.9 million)), and (z) the distribution of dividends to holders of Common Shares (including the Depositary) of LL 603 per Common Share (aggregating LL 241,049 million (USD 159.9 million)), in each case, on April 14, 2016 to holders of record as at April 13, 2016;
(iv) Having examined the draft External Auditors special reports in connection with Article 152 of the Code of Money and Credit in connection with outstanding loans to related parties subject to Article 152 of the Code of Money and Credit ("Article 152 Loans");
(v) Having, in consideration of the fact that the outstanding loans to related parties had exceeded the applicable ceilings as at 31 December 2015, (x) noted that the excess situation was resolved on 21 March 2016, and (y) adopted a proposal to ratify the Article 152 Loans outstanding as at 31 December 2015;
(vi) Having, in consideration of the fact that, as at the date of Annual Ordinary General Meeting, the regulatory ceiling of the aggregate amount of Article 152 Loans allowed to be granted during 2016 is LL 25 billion, adopted a proposal to approve aggregate Article 152 Loans within said ceiling;
(vii) Having examined the draft External Auditors special reports in connection with Article 158 of the Code of Commerce, pursuant to which the External Auditors did not express any remarks in connection with transactions entered into between the Bank and members of the Board of Directors or affiliated companies;
(viii) Having adopted a proposal to ratify transactions entered into between the Bank and members of the Board of Directors or affiliated companies during 2015 by virtue of the authorization granted by the general meeting of shareholders on 7 April 2015 and pursuant to Article 158 of the Code of Commerce and to authorize the Bank to enter into similar transactions during 2016 (until the next annual ordinary general meeting expected to be held in April 2017);
(ix) Having, pursuant to Article 158 of the Code of Commerce, approved (by virtue of the authorization granted by the general meeting of shareholders on 7 April 2015) (i) the payment of fixed remuneration in 2015 aggregating LL 23.8 billion (USD 15.8 million) to 7 persons (including the current Chairman of the Board, the Executive Directors and the members of the Executive Committee who are not members of the Board of Directors); and (ii) the payment of a performance-related remuneration to the Directors members of the Executive Committee (4 persons) representing 1.9% of the Bank's consolidated net profits before taxes, all aggregating LL 15.2 billion (USD 10 million);
(x) Having (in consideration of the fact that the term of the current Board of Directors will expire upon the meeting of the General Assembly), nominated the below-listed candidates to the new Board of Directors, each for a three-year term of office, in line with the recommendation of the Corporate Governance and Nomination Committee (the Board having expressed its satisfaction that the nominated candidates benefit from, as a collective body, an adequate superior knowledge of the financial industry and an excellent understanding of the Company's client base and of the main geographic markets in which the Company is active and that all the candidates have a reputation and track record that demonstrate their ability to make the kind of important and sensitive judgments that the Board is called upon to make):
Nomination Proposal encompassing the re-election of 10 Directors:
Candidate | Brief Profile |
H.E. Mr. Raymond W. Audi Age: 83 - Lebanon Director since February 1962
| Raymond Audi acts as Chairman of the Board of Directors and General Manager since December 2009. He had also served as Chairman of the Board of Directors and General Manager from 1998 to 2008, resigning from this position when he was appointed Minister of the Displaced in the Lebanese government. Mr. Audi resumed his position as Chairman of the Board of Directors effective December 22, 2009. He started his banking career in 1962, when, together with his brothers and with prominent Kuwaiti businessmen, he founded Bank Audi, building on a successful long standing family business.
Raymond Audi has played an active role in leading Bank Audi through both prosperous and challenging times to its current status as a widely recognised leading Lebanese and regional bank. He served as President of the Association of Banks in Lebanon in 1994.
Raymond Audi is the recipient of several honours and awards, including, in July 2007, an Honorary Doctorate in Humane Letters from the Lebanese American University. |
Dr. Marwan M. Ghandour Age: 72 - Lebanon Director since March 2000
| Marwan Ghandour is an independent member of the Board of Directors since March 2000 and the Vice-chairman of the Board of Directors since December 2009. He is a previous Vice-governor of the Central Bank of Lebanon. He held this position between January 1990 and August 1993, with primary responsibilities in the area of monetary policy. During this period, he was also a member of the Higher Banking Commission and various other government committees involved in economic policy. In this capacity, he liaised with renowned international institutions such as the International Monetary Fund (IMF), the World Bank and the Bank for International Settlements (BIS). From 1995 until July 2011, Marwan Ghandour served as Chairman and General Manager of Lebanon Invest sal, a leading financial services group in the region whose holding company merged with Bank Audi in 2000. He chaired the Board of Directors of Banque Audi (Suisse) SA from March 2011 until December 2015. He also served as Chairman of the Board of Directors of Audi Investment Bank sal, a fully owned subsidiary of Bank Audi, from 2005 until December 2011. Marwan Ghandour is also the Vice-chairman of the Board of Directors of Odea Bank A.Ş., Bank Audi's subsidiary in Turkey, since June 2012, and serves as member of the Board of Directors of several affiliates of Bank Audi.
Marwan Ghandour holds a PhD in Economics (Econometrics) from the University of Illinois (Post-doctorate research at Stanford University).
|
Mr. Samir N. Hanna Age: 71 - Lebanon Director since August 1990
| Samir Hanna joined Bank Audi in January 1963. He held several managerial and executive positions across various departments of the Bank. He was appointed General Manager of Bank Audi in 1986 and member of its Board of Directors in 1990. In the early 1990s, he initiated and managed the restructuring and expansion strategy of Bank Audi, transforming it into a strong banking powerhouse offering universal banking products and services including Corporate, Commercial, Retail, Investment, and Private Banking.
He grew the Bank to its current position as the largest bank in Lebanon (and among the top 20 Arab banking groups), with a presence in 12 countries, consolidated assets exceeding USD 42 billion, consolidated deposits exceeding USD 35 billion and a group staff headcount exceeding 6,000 employees.
Samir Hanna is also the Chairman of Odea Bank A.Ş., Bank Audi's subsidiary in Turkey, and member of the Board of Directors of several other affiliates of Bank Audi.
He currently serves as the Group Chief Executive Officer and the Chairman of the Group Executive Committee, and heads all aspects of the Bank's Executive Management. |
Mr. Marc J. Audi Age: 58 - Lebanon Director since March 1996
| Marc Audi started his banking career at Bank Audi France sa in 1981. He then moved to Banque Audi California where he was appointed Director and Executive Vice-president. He later returned to Lebanon to join Bank Audi in 1993, and was appointed member of its Board of Directors in 1996. He held executive responsibilities successively in Commercial Lending and Capital Markets divisions. Marc Audi served as General Manager of Banque Audi (Suisse), the Private Banking arm of the Audi Group of Banks until 2005, and remains a member of its Board of Directors. He also serves as member of the Board of Directors of several affiliates of Bank Audi, and has been General Manager of the Bank since 2004, where he currently acts as the Lebanon Country Manager.
Marc Audi holds a Master's of Business Administration from the University of Paris IX - Dauphine. |
Dr. Freddie C. Baz Age: 63 - Lebanon Director since March 1996
| Freddie Baz joined the Bank in 1991 as Advisor to the Chairman and founded the Secretariat for Planning and Development at the Bank. As Group Strategy Director, he is now responsible for the development of the Group strategy and for its oversight and communication, internally and externally. In addition to his duties as Group Strategy Director, Freddie Baz held the position of Group Chief Financial Officer from 2006 to 2015, with overall authority over the finance and accounting, MIS and budgeting functions throughout the Group. In March 2015, he decided, jointly with the Group CEO, to hand over his Group CFO responsibilities to his deputy, in conclusion of five years of cooperation and of common efforts to achieve that objective.
Freddie Baz was appointed Vice-chairman of the Board of Directors of Bank Audi sal in June 2015. He is also the Chairman of the Board of Directors of Bank Audi France sa, a fully owned subsidiary of Bank Audi, and a member of the Board of Directors of several affiliates of Bank Audi. Furthermore, he is the General Manager of Bankdata Financial Services WLL which publishes Bilanbanques, the only reference in Lebanon that provides an extensive structural analysis of all banks located in Lebanon, in addition to other specialized periodicals and reports.
Freddie Baz holds a State PhD degree in Economics from the University of Paris I (Panthéon - Sorbonne). |
Dr. Imad I. Itani Age: 54 - Lebanon Director since June 2002
| Prior to joining the Bank, Imad Itani held several key positions in Corporate Finance for major energy companies in Canada. In parallel, he taught Economics and Finance to graduate students at the American University of Beirut. He joined Bank Audi in 1997 and headed the team that successfully launched the Bank's Retail business line, today a major pillar of the Bank's innovative and leading position. In 2002, Imad Itani was appointed Deputy General Manager and Member of the Board of Directors. He was later appointed General Manager - Head of Group Retail Banking.
Imad Itani is also the Chairman of Audi Investment Bank sal, a fully owned subsidiary of Bank Audi, and a member of the Board of Directors of Odea Bank A.Ş., Bank Audi's subsidiary in Turkey, in addition to his responsibilities as Head of Group Retail Banking and Head of Group Islamic Banking.
Imad Itani holds a PhD in Economics from the University of Chicago. |
Sheikha Suad H. Al Homaizi Age: 73 - Kuwait Director since February 1962
| Sheikha Suad Al Homaizi is the wife of late Sheikh Jaber Ali Salem Al Sabbah, a prominent member of the ruling family of Kuwait. She is one of the founders of Bank Audi. Sheikha Suad Al Homaizi is one of the largest Kuwaiti private real estate developers and is active in many business sectors in Kuwait and overseas, notably representing multinational corporations in the fields of infrastructure, construction, pharmaceuticals and others.
She is a member of the Board of Directors of Bank Audi since February 1962. |
Sheikha Mariam N. Al Sabbah Age: 67 - Kuwait Director since March 2001
| Sheikha Mariam Al Sabbah is the daughter of late Sheikh Nasser Sabah Al Nasser Al Sabbah and the widow of the late Sheikh Ali Sabah Al Salem Al Sabbah, who was the son of the former Prince of Kuwait and who held several ministerial positions in Kuwait, notably the Ministry of Interior. Sheikh Nasser Al Sabbah was one of the founders of Bank Audi. Sheikha Mariam Al Sabbah is a member of the Board of Directors of several Kuwaiti companies. She is a member of the Board of Directors of Bank Audi since March 2001. |
Mr. Abdullah I. Al Hobayb Age: 73- Saudi Arabia Director since April 2010
| Abdullah Al-Hobayb is the Chairman of Audi Capital (KSA) (an Investment Banking subsidiary of Bank Audi, incorporated in the Kingdom of Saudi Arabia) and was, until July 2014, a member of the Boards of Directors of Bank Audi sae in Egypt and of Odea Bank A.Ş., Bank Audi's subsidiary in Turkey. He was also an advisor to the previous Board of Directors of Bank Audi. He is the Chairman of several leading companies in Saudi Arabia comprising ABB Saudi Arabia (a leader in power and automation technologies), General Lighting Company Ltd (one of the largest manufacturers in the Middle East lighting industry), Ink Products Company Ltd (manufacturer of industrial ink) and United Industrial Investments Company Ltd (a leading paint manufacturing company).
Abdullah Al Hobayb holds a Master's degree in Electrical Engineering from Karlsruhe University in Germany. |
Dr. Khalil M. BitarAge: 73 - Lebanon Director since April 2010
| Khalil Bitar is a current Professor of Physics and a former Dean of the Faculty of Arts and Sciences of the American University of Beirut (AUB). He held this last position from 1997 until 2009, playing an instrumental role in advocating AUB's strengths and regional position as the premier centre for higher education, and in re-establishing its PhD programs. Throughout his career, he held several academic and administrative positions, including Associate Director of the Supercomputer Computations Research Institute - Florida State University (between the years 1994 and 1997) and visiting Professor at leading academic institutes in Europe and North America (including the European Organisation for Nuclear Research in Geneva, the International Centre for Theoretical Physics in Italy, The Institute for Advanced Study in New Jersey, the Fermi National Accelerator Laboratory (Fermilab) in Illinois, the University of Illinois, Brookhaven National Lab. in New York, the Max Planck Institute in Munich, and the Rockefeller University in New York). He also served two mandates as member of The Institute for Advanced Study in Princeton, New Jersey, between 1968 and 1972.
Khalil Bitar is also a member of the Board of Directors of Audi Private Bank sal and the Chairman of its Risk Committee. He also served as member of the Board of Directors of Audi Investment Bank sal and Chairman of its Risk Committee from March 2012 until November 2013, and continues to serve as advisor to its Board for Risk Committee matters.
Khalil Bitar holds a Bachelor of Science degree in Physics from the American University of Beirut, a Master's of Science degree in Physics, and a PhD in Theoretical Physics from Yale University in the United States. |
(xi) Having confirmed the managerial responsibilities of the Executive Directors and having adopted a proposal to:
a. Maintain the fixed remuneration arrangements of the Chairman of the Board and that of the Executive Directors of the Board unchanged from the previous year; and
b. Confirm the resolution of the Annual Ordinary General Assembly dated 14 April 2014 granting the Executive Directors an annual performance-related cash remuneration not exceeding 2.4% of the Bank's consolidated net profits before taxes for the financial years 2014 to 2017 inclusive;
(xii) Having, pursuant to Article 158 of the Code of Commerce, adopted a proposal to maintain unchanged the additional annual remuneration to the Chairman and members of the Board who are non-executive and/or independent directors, including the Vice-Chairman (a total of 5 persons), aggregating USD 2,3 million per annum (i) for their chairmanship or membership of certain Board committees (the Audit Committee, the Governance and Nomination Committee, the Remuneration Committee and the Risk Committee), and/or (ii) for their assistance to the Board and its committees (and to the boards of banking subsidiaries and their committees) including in control and governance oversight matters and in risk oversight matters;
(xiii) Having adopted a proposal to grant the members of the Board annual attendance fees of LL 25 million each, the Chairman of the Board being allocated two parts and each other Director being allocated one part (unchanged as compared to 2015);
(xiv) Having adopted a proposal to authorize the participation of certain Board members in the boards of controlled subsidiaries of the Bank;
(xv) Having, pursuant to the matters mentioned under points (iv) to (xiv) above, adopted the "Special Report of the Board of Directors" produced in accordance with Article 152 of the Code of Money and Credit and Article 158 of the Code of Commerce and summarizing (x) the transactions entered into by the Bank with related parties (including affiliated companies and members of the Board of Directors) during the year ended December 31, 2015 and (y) the remuneration of the members of the Board and of the General Managers; and
(xvi) Having adopted a recommendation of the Audit Committee (x) to re-appoint "BDO, Semaan, Gholam & Co." and "Ernst & Young" as joint External Auditors of the Company for the financial years 2016, 2017 and 2018 and (y) to set their fees at USD 1,350,000 (USD 675,000 to each auditing firm) for the year 2016 (unchanged with respect to 2015).
Resolved to recommend to the General Assembly to adopt the following resolutions:
1. To approve the Bank's accounts, in particular, the balance sheet and the profit and loss statement, as of and for the year ended December 31, 2015, and to discharge the Chairman and members of the Board of Directors of the Bank in respect of activities performed during the year ended December 31, 2015;
2. To appropriate the 2015 profits in accordance with the proposal of the Board of Directors;
3. To declare distributions to the holders of the Bank's preferred shares and dividends to the holders of Common Shares and determine the related record and payment dates;
4. To ratify loans granted during the year 2015 to related parties as per Article 152 of the Code of Money and Credit;
5. To authorise the granting of loans to related parties during the year 2016, in accordance with Article 152 of the Code of Money and Credit;
6. To ratify transactions that are subject to the approval of the General Meeting including transactions entered into between the Bank and members of the Board of Directors or affiliated companies during the year ended December 31, 2015 that are subject to Article 158 of the Code of Commerce and to authorise the Bank to enter into similar transactions during the year 2016; (until the next annual ordinary general meeting expected to be held in April 2017);
7. To elect a new Board of Directors and to determine the remuneration of its members;
8. To confirm the managerial responsibilities of certain Board members and to determine their fixed and performance-related remuneration in respect of such responsibilities;
9. To authorise the participation of certain Board members in the boards of other companies and to grant the necessary related authorisations pursuant to Article 159 of the Code of Commerce; and
10. To appoint External Auditors for the coming 3 years and to determine their fees for the year 2016.
All as per the aforementioned Board reports, proposals and recommendations.
VOTING INSTRUCTIONS
Each Holder is hereby requested to return to the Depositary voting instructions, in the form provided separately by the Depositary for this purpose, by which such Holder may give instructions to the Depositary to vote for or against each and any resolution specified in the agenda for the General Meeting.
In order for a voting instruction to be valid, the above-mentioned form of voting instructions must be completed and duly signed by the respective Holder (or in the case of instructions received from the clearing systems should be received by authenticated SWIFT message or market standard authenticated message format) and returned to the Depositary by the date that the Depositary shall specify in such form of voting instructions.
INFORMATION REGARDING BANK AUDI S.A.L.
For information regarding the Bank, Holders are advised to review the following documents:
- The Bank's Annual Report for 2015 encompassing:
o The Audited financial statements of the Bank as of and for the year ended December 31, 2015 and the accompanying notes and auditors' report;
o The "Management Discussion and Analysis" which summarises the Bank's activity during the year ended December 31, 2015.
The above documents (in Arabic or English, or both, as the case may be) can be downloaded from Bank Audi's website: www.bankaudigroup.com or may be obtained free of charge from the Bank and the Depositary at the addresses set forth below:
The Depositary:
Deutsche Bank Trust Company Americas
Winchester House
1 Great Winchester Street
London EC2N 2DB
Attn: Ms. Katia Levy-Thevenon
The Bank:
Bank Audi s.a.l.
Bab IdrissOmar Daouk StreetBanque Audi Plaza, P.O. Box 11-2560BeirutLebanon
Attn: The Group Corporate Secretary