Janne Holkko OP Corporate Bank 5 September 2017 Finance Janne Holkko OP Corporate Bank 5 September 2017

Brief background of myself Began studies at Aalto School of Business in 1998* BSc 2002, MSc 2004 (Finance) M&A research Sampo Bank (Danske) Reuters and Venture Cup Finland Icecapital Corporate Finance (M&A) SEB Corporate Finance (M&A, ECM) Currently Head of Syndications, Real Estate and Corporate Loans at OP Corporate Bank * Helsinki School of Economics and Business Administration at that time

Why finance? Facts and figures, problem solving and complex negotiations Access to CEOs, CFOs, Group Treasurers, private equity professionals etc. Steep learning curve A variety of disciplines: Corporate treasury Loan and debt capital markets Equity capital markets Mergers and acquisitions Asset management Derivatives etc.

What is a syndicated loan? ”…two or more lenders (the syndicate) contracts with a borrower to provide credit on common terms and conditions, governed by a common document” Key terminology: Underwritten / best efforts / club deal Term loan (= drawn money), amortising or bullet (= 100% at final maturity) Revolving Credit Facility (RCF) Facility agreement types: Investment Grade Leveraged (LBO) Commercial Real Estate Financing Project Financing

Maturity structure of Finnish syndicated loans Next maturity peek in Finland 2019, which indicates that refinancings increase during 2018

Syndicated loan process timetable A standard syndicated loan process takes some 7-8 weeks from initial contact(s) to signing and closing

Key issues to negotiate Pricing Terms and conditions Facility structure Arrangement fee Margin Margin grid based on a financial metric (e.g. leverage, gearing, or equity ratio) Commitment fee, % of margin Coordinator and agency fees Financial covenants Net Debt / EBITDA Net gearing (debt/equity) Equity ratio (equity/assets) General undertakings Negative pledge, change of control, acquisitions etc. Events of default Facility size and maturity Number of banks/ financial institutions approached Ticket levels (EURm) Coordinators/ bookrunners Others Mandated Lead Arrangers Arrangers

Tombstones and league tables Selected reference cases Syndicated loans in Finland H1/2017 (EURm)1 Strong Coordination Mandates E18 Hamina-Vaalimaa PPP Project Project Financing Facilities Mandated Lead Arranger, Coordinator, Global Agent, Hedging Bank June 2015 Kauppakeskus REDI and REDI Parkki € 225.000.000 Bookrunner, Coordinator and Facility Agent March 2015 Term Loan € 64.700.000 and Bank Guarantee Facilities € 9.860.000 for Manga Terminal Oy Mandated Lead Arranger Gasum Oy Facilities Agreement € 640.000.000 Mandated Lead Arranger, Bookrunner and Coordinator March 2016 Sanoma Corporation Multicurrency Revolving Credit Facility € 500.000.000 Co-ordinating Bookrunner Facility Agent February 2016 Lemminkäinen Corporation Revolving Credit Facility € 200.000.000 Coordinator, Agent And Bookrunner March 2017 Bilateral Facilities for Kymenlaakson Sähkö & Kymenlaakson Sähköverkko € 155.000.000 May 2017 Bilateral Term Loan Facility Amer Sports Corporation € 50.000.000 February 2016 for Fiskars Oyj Abp August 2015 (13 deals) (11) (11) (5) (2) Significant Bilateral Facilities (2) (1) (1) (1) (1) Project Financing Landmarks OP's rank 2010 2011 2012 2013 2014 2015 2016 By EURm # 3 # 2 # 1 By number of issues OP has been a top 3 bank each year since 2010 Source: Bloomberg. Non-LBO syndicated loans in Finland. EURm stands for MLA credit.

Syndicated Facilities Case examples Syndicated Facilities Bilateral Facilities Project Financing OP, Nordea and ING coordinated Sanoma’s refinancing Syndicate of 7 banks 4+1 -year maturity Margin based on leverage, initially 1.75% Forestry company Tornator (Stora Enso 40%) signed an additional bilateral financing of EUR 100 Other loans extended by 1 year A secured facility with a 4 years maturity Largest single asset real estate transaction ever in Finland at EUR 480 mil. total investment cost Sopping centre and parking facility will be opened in 2018 Syndicate of 5 banks Sanoma Corporation Multicurrency Revolving Credit Facility € 500.000.000 Co-ordinating Bookrunner and Facility Agent February 2016 Kauppakeskus REDI and REDI Parkki Project Financing Facilities € 225.000.000 Mandated Lead Arranger, Bookrunner, Coordinator and Facility Agent March 2015 Bilateral Term Loan and Revolving Credit Facilities for Tornator Oyj € 350.000.000 April 2017 Pre-IPO facility for Suomen Asiakastieto, owned by private equity company Investcorp EUR 197 million IPO was carried out in March 2015, in which OP acted as Senior Co- lead Manager A bilateral back-up credit facility for a well know Finnish gaming & entertainment company Public Private Partnership financing of a 32 km of E18 highway from Hamina to Vaalimaa Total investment cost of the project was EUR 265 million Facilities Agreement For AKT Holdings Oy and Suomen Asiakastieto Oy € 75.000.000 Mandated Lead Arranger November 2014 E18 Hamina-Vaalimaa PPP Project Project Financing Facilities Mandated Lead Arranger, Coordinator, Global Agent, Hedging Bank June 2015 Bilateral Revolving Credit Facility for Rovio Entertainment Oy € 15.000.000 September 2016

Extracurricular readings

Thank you for your attention!