Norway Ship & Offshore Finance Forum Presented by Pål Rokke, Citi Country Officer Norway

Marine Money, Oslo

4th June 2015

Citi Institutional Clients Group

Table of Contents

Overview 1

Loan Market 3

Export Credit Agency 6

High Yield Market 8

Equity Capital Markets 12

Conclusion 15

Overview

Global Shipping & Offshore Market Increased regulatory pressure and the exit of certain institutions from the market has lead to a constrain on the availability of traditional bank financing.

Alternative sources of funding (namely debt / equity capital markets and export credit agency financings) have therefore become increasingly important to the shipping and offshore industry

Key Credit Considerations for Lenders in the Shipping / Offshore Space

Overall fleet collateral value / loan-to-value i

Committed revenue backlog and contract tenor ii

Vessel quality, type and age iii

Management’s operating history iv

Market outlook for vessel supply & demand v

Existing Capital Structure (i.e. receipt of ship mortgages, limitations on additional debt, liens etc.) vi

1 Overview

Syndicated Bank Facility Export Credit Agency Financing Senior Secured Notes / Institutional Term Loan Unsecured Notes

Description • Senior secured bank funded term loan facility

• Senior Secured ECA financing (may include commercial bank funded tranches)

• Secured notes or Term Loan, syndicated to high yield investors in the U.S.

• Unsecured notes, syndicated to high yield investors in the U.S.

Collateral • A first priority lien on the specified vessels, evidenced by ship mortgages

• A first priority lien on the specified vessels, evidenced by ship mortgages

• A first priority lien on the specified vessels, evidenced by ship mortgages

• None

Tenor • 5 – 7 years

• Up to 12 years • Up to 8 years – Investors prefer shorter tenor in

current environment

• Up to 8 years – Investors prefer shorter tenor in

current environment

Repayment • Amortising term loan based with a repayment profile of up to 20 years

• ECA Tranche: Based on a 12-year repayment profile

• Commercial Tranche: up to a 20 year repayment profile

• Senior Secured Notes: Bullet • Term Loan B: De minimis (1% per

annum)

• Bullet

Ratings Requirements

• None

• None • S&P / Moody’s • S&P / Moody’s

Maintenance Covenants

• Dependent – usually in line with existing covenants, and may include Leverage Interest Coverage

• Dependent – usually in line with existing covenants, and may include Leverage Interest Coverage

• None – Incurrence covenants only

• None

Pre-Payment Penalty

• None

• None • Dependent on type • Dependent on type

Benefits ▲ Long amortisation profile achievable ▲ Ability to leverage existing

relationship banks ▲ Most flexible market with respect to

prepayments and amendments

▲ Lowest Pricing ▲ Long tenor ▲ Ability to leverage existing banking

and ECA relationships

▲ Fixed coupon ▲ Longest tenor ▲ No / minimal amortization

▲ No additional liens on assets ▲ Fixed coupon ▲ Longest tenor ▲ No amortization requirement

Considerations ▼ Shorter duration than that available in the bond & ECA markets

▼ Financial maintenance covenants

▼ Sizeable amortizations ▼ Financial maintenance covenants

▼ Possible call protection ▼ High interest expense

▼ Possible call protection ▼ Highest interest expense

Timeline • 7 – 8 weeks • 24 weeks

• 7 – 8 weeks

• 7 – 8 weeks

Summary - Debt Financing Alternatives

2 Overview

Loan Market

1,084

605 466 687

877

455 564 884

175 163

368

130 98

75

141

119 173

165

22 20

295

185

101

127

156

145

189

148

23 37

49%

40%

14%

17% 14%

19%

14%

25%

16%

27%

0%

10%

20%

30%

40%

50%

0.00

400.00

800.00

1,200.00

1,600.00

2,000.00

2007 2008 2009 2010 2011 2012 2013 2014 Q12014

Q12015

0%

5%

10%

15%

20%

25%

Swed

bank

SHB

SEB

Nor

dea

Dan

ska

UB

SIn

tesa MS

Lloy

dsD

nBM

edio

bBP

Mila

noC

aixa

Ban

kG

oldm

anD

euts

che

Bank

iaU

BI

Saba

dell

ING

Nat

ixis

Popo

lare

RB

SH

SBC

Stan

Cha

rtC

itiBa

rlcay

sW

ells

Far

goPo

pula

rC

redi

t Ag

BBVA

BNPP

SocG

enJP

M CS

Uni

Cre

dit

RB

IBA

ML

Sant

ande

rC

omm

erz

EMEA Loan Market Summary & Key Trends Q1 2015 saw a sharp increase in EMEA event driven volumes over Q1

2014 - despite overall volumes being relatively flat

Q1 2015 saw a significant increase in the proportion of event-driven financings as part of overall deal volumes

Despite the total deal volumes being relatively high, banks remain asset hungry

Gen

eral

Tre

nds

EMEA Event-driven loan volumes were up 114% in 2014 – the highest since 2008 – with lenders heavily supporting all major event-driven transactions which came to market during the year

EMEA lenders continue to be very asset hungry – particularly to support core client relationships and for drawn (or bridge) facilities

Sum

mar

y R

esul

ts /

Posi

tion

Refinancing (incl. amend & extend) volumes remained robust in 2014 as borrowers capitalized on attractive market conditions to refresh pricing and tenor

Banks balance sheets continued to improve - with European bank stress testing keeping the industry focused on increasing capital ratios

Discipline of returns based lending continues to prevail, as banks shareholders focus on returns on equity/assets (meaning ancillary business key)

Banks increase focus on meeting capital targets will influence lending policies

US$bn

Source: Dealogic

EM

EA

Ann

ual L

oan

Vol

umes

High-Grade Leveraged

Emerging Markets % Total Event-Driven

Banks balance sheets expected to improve significantly and demand for exposure expected to remain strong into 2015

% of E

vent-Driven Transactions

9.2% 12.0%

Average Tier-1 Capital Ratio (2008) Average Tier-1 Capital Ratio (2014)

Tier-1 Capital Ratios (%) Source: Company reports

Tier

-1 C

apita

l Rat

ios

(%)

Tier-1 Capital Ratio (2014)

3 Loan Market

Current Acquisition Financing Landscape

Source: Dealogic, Citi

2014 was the third-strongest year ever recorded for Global M&A volume, behind only 2006 and 2007. Global M&A volume was up 47% compared to 2013, with a 75% increase in $10bn+ deals year-on-year. This has continued into 2015, recording the strongest Q1 since 2007, up 23% quarter-on-quarter vs. Q1 2014. Markets remain supportive for transformational financings.

Global M&A Volumes Surging Current M&A Cycle in Historical Perspective

Since the start of 2014, global strategic M&A activity has surged, increasing at the fastest pace seen over the past 14 years. It has

continued in 2015 with Q1 up 23% q-o-q

Over the past 18 months, EMEA has seen a breakout in major M&A transactions, after a relatively subdued period since 2011

Corporates are seeking to pursue transformational M&A transactions which is leading to a rise of ‘jumbo’ acquisition financing transactions

EMEA Event-driven loan volume totalled $263bn in 2014, up 114% annually and the highest since volume 2008 ($410bn). Q1 2015 saw a sharp increase in EMEA event driven volumes over Q1 2014 up 84% -

despite overall volumes being relatively flat

M&A Volumes & Emerging Trends

EMEA Loan Volumes Key Takeaways

+47%

EMEA Loan Event Driven Financing Continues to Expand 1

2

3

4

Vol

ume

by re

gion

(bn)

Global D

eal Volum

e (bn)

Dea

l Vol

umes

(bn)

40%

14% 17%

14% 19%

14%

25%

16%

27%

0%

10%

20%

30%

40%

50%

$0

$200

$400

$600

$800

$1,000

$1,200

2008 2009 2010 2011 2012 2013 2014 Q1 2014 Q1 2015Western Europe CEEMEA % Event driven

$2,876

$1,997

$2,433 $2,512 $2,546 $2,364

$3,485

$684 $840

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$0$200$400$600$800

$1,000$1,200$1,400$1,600$1,800$2,000$2,200

2008 2009 2010 2011 2012 2013 2014 Q1 2014 Q1 2015

EMEA Deal Value Non-EMEA Deal Value Total Deal Value

+23% vs.

Q1’14

$0.4$0.3

$0.3$0.4

$0.5$0.9

$1.1$1.6

$2.5

$3.3$3.4

$1.7

$1.2$1.3

$1.9

$2.7

$3.6

$4.1

$2.9

$2.0$2.4

$2.5$2.5

$2.4

$3.5

$0.7$0.9

(33%)(23%)6%25%

24%71%

20%48%

52%

30%4%

(50%)(29%)11%

41%

42%

35%14%

(30%)

(31%)

22%3% 1%(7%)

47%

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 Q114

Q115

4 Loan Market

Global Shipping and Offshore Loan Overview Deal activity picked up 2013-14, but 2015YTD has been slower… …Deal sizes have retracted in 2015YTD…

… Appetite for longer tenors are increasing Market Overview

$251 $268 $249

$245 $267

$235 $296

$290

$228

$0

$50

$100

$150

$200

$250

$300

$350

2007 2008 2009 2010 2011 2012 2013 2014 2015YTD

Average Size of Deals ($mn)

Source: Dealogic – Global syndicated loans excluding ECA financings, 31 May 2015

25% 37% 32%

50% 59% 61% 56% 53% 60%

75% 63% 68%

50% 41% 39% 44% 47% 40%

2007 2008 2009 2010 2011 2012 2013 2014 2015YTD

> 5yr ≤ 5yrs

70 60

25 33 35 39

49 52

20 13

31

25

6

14 22 11

17 41

11 7

340

272

113

178 206

188 207

236

99

30

0

50

100

150

200

250

300

350

400

0

20

40

60

80

100

120

2007 2008 2009 2010 2011 2012 2013 2014 2014YTD2015YTD

Total Offshore Deal Value($bn)

Total Shipping Deal Value($bn)

Total Number Of Deals

• 2015 issuance YTD has been lower than 2014 YTD and offshore issuance is expected to drag down total issuance for the rest of the year

• After seeing deal sizes increase the last two years we have started to see a return to smaller clubs and bilaterals

• While 2015YTD issuance has seen shorter tenors come back in the syndicated loan market, we generally are seeing appetite from banks to provide longer tenors

Lenders’ Overview • The sector has benefitted from continued support from Nordics, French and

Japanese banks over the years

• Select number of key lenders continue to play across a variety of sectors provided deal structure is robust, with strong underlying collateral and appropriate LTV’s

• Pockets of regional liquidity continues to exist depending on the borrower location, particularly in Middle East and Asia

• On the whole, lenders tend to be active in certain pockets/sectors rather than across the entire shipping sector

5 Loan Market

Export Credit Agency

Key Facts about Citi Export and Agency Finance • Long standing relationships with over 65 agencies globally

• 49 professionals focusing on seamless transaction execution through direct engagement with agencies and clients in native language

• Portfolio includes transactions supported by export credit agencies (ECAs), development finance institutions (DFIs), and multilateral agencies (MLAs)

• Our approach is unique insofar as:

− Citi excels in coordination of larger syndications with broad range of investors across banks and non-banking institutions

− Citi’s distribution team is well known in the market for having one of the widest distribution networks

− Transactions often incorporate embedded structured derivatives

− Citi is Borrower focused and thus not biased towards any particular agency or exporter

• Broad industry experience: Public Sector, Financial Institutions, Oil & Gas, Power, Metals & Mining, Telecoms, Infrastructure, Aviation, Shipping & Transportation amongst others

Citi Export and Agency Finance Overview

Highlights • In 2014, Citi’s EAF business arranged more than US$12 billion in Official

Agency-supported transactions across 32 countries • Citi topped the ECA financing mandated lead arranger ranking in 2014 • Transactions executed by Citi in 2013 won 12 Deal of the Year Awards • Citi’s global presence is unparalleled: Citi’s Export Agency Finance team

operates via four hubs in New York, London, Hong Kong, and Tokyo as well as nine additional offices in Washington D.C., Zurich, Dubai, Seoul, Beijing, Singapore, Lagos, Nairobi, and Miami. Furthermore, Citi has a presence in over 100 countries, and conducts business in over 160 countries

Citi’s EAF team has significant experience with a wide range of key Official Agencies globally. EAF consistently leads the league tables for export credit agency (ECA) supported financing and receives market recognition for its focus on innovation in export and agency finance

Rankings for ECA Supported Loans (2010-2014)

Source: Dealogic data as of February 5th, 2015

2010 - 2014 (in USD MM)

Global Export and Agency Finance Regional Offices

New York Washington D.C.

London

Dubai Hong Kong

Tokyo

Singapore Lagos

Seoul Zurich

Nairobi

Miami Beijing

6 Export Credit Agency

General Benefits of ECA Financing

Benefits / Features to Borrowers

Capacity: ECAs may support large projects for up to several billion US$/EUR

Stable Credit Costs: ECA risk premia do not fluctuate in line with commercial market pricing ECA premia are primarily determined by tenor profile, country risk and availability period

ECAs are influenced by borrower credit risk, but their corporate spread curve is not as steep as the commercial market’s

Diversification of Funding Sources and Preservation of Bank Lines: ECAs provide guarantees for 95%-100% of the debt, transforming the credit profile of the debt for bank. The association of government entities in the debt mix is also a beneficial feature for all clients

Fixed Interest Rate: Many ECAs offer Commercial Interest Reference Rate (CIRR), offering arbitrage opportunities without swap cost or credit lines. Borrowers can monetise rate benefits embedded in a CIRR

Stable Deal Execution: ECAs provide reliable liquidity to the market and as they are funded by governments, they are not impacted as much by market liquidity issues

Long Tenors: Under OECD guidelines, ECA repayment periods (exclusive of construction periods) are between up to 5 and 15 years depending on country and purpose

Long Availability Period and Drawdown Flexibility – set to match payments under the commercial contract

Reach back: Can finance past as well as future CAPEX

There are many benefits to ECA financing for borrowers; ECAs can provide consistent support in good times as well as during more challenging market environments

7 Export Credit Agency

High Yield Market

200

250

300

350

400

450

May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15

bps

Series 21 Series 22 Series 23

Current High Yield Market Conditions Weekly HY US Mutual Fund Flows iTraxx 5-yr Crossover

Government Bond Yields

288 US

fund

flow

s ($

m)

Source: Bloomberg and Citi

200

300

400

500

600

700

Sep-12 Apr-13 Oct-13 Apr-14 Oct-14 May-15

bps

Series 18 Series 19 Series 20 Series 21 Series 22 Series 23

-8,000-7,000-6,000-5,000-4,000-3,000-2,000-1,000

01,0002,0003,0004,0005,000

May

-12

Jul-1

2

Sep-

12

Nov

-12

Jan-

13

Mar

-13

May

-13

Jul-1

3

Sep-

13

Nov

-13

Jan-

14

Mar

-14

May

-14

Jul-1

4

Sep-

14

Nov

-14

Jan-

15

Mar

-15

May

-15

0.00

1.00

2.00

3.00

4.00

5.00

6.00

May-05 May-07 Apr-09 May-11 Apr-13 May-15

Yie

ld (%

)

10-yr Avg.: 3.410% 10-yr Avg.: 3.223% 10-yr Avg.: 2.721%

Current: 1.813% Current: 2.104% Current: 0.487%

German BundUK Gilt US Treasury

8 High Yield Market

$60.

5$1

6.9

$32.

9$1

7.3

$54.

7$2

7.2

$31.

1$2

4.9 $3

0.9

$21.

3$4

6.0

$56.

9$4

6.5

$45.

5$2

7.3

$4.5

$47.

2$3

0.2

$28.

8$1

5.3

$26.

5$4

0.8

$56.

7$4

8.8

$36.

4

0

10

20

30

40

50

60

70

May

-13

Jul-1

3

Sep-

13

Nov

-13

Jan-

14

Mar

-14

May

-14

Jul-1

4

Sep-

14

Nov

-14

Jan-

15

Mar

-15

May

-15

US

Dol

lars

in b

illio

nsHigh Yield New Issue Volume

European New Issuance Global New Issuance

European Monthly Issuance

Source: LCD, Newsrun and Citi

Global Monthly Issuance

$41.

0

$64.

0 $110

.0

$140

.0

$103

.0

$51.

5

$84.

1

$61.

5 $140

.0

$154

.8

$112

.9 $178

.9

$160

.0

$57.

0

$188

.8

$317

.1

$276

.2

$367

.5

$415

.0

$400

.3

$209

.2

0

50

100

150

200

250

300

350

400

450

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

US

Dol

lars

in b

illio

ns

$3.3

$3.1

$6.2

$15.

6

$17.

7

$13.

5

$6.7

$4.1

$17.

3

$24.

8

$21.

3

$38.

6

$26.

4

$0.0

$41.

1 $6

6.1

$67.

5

$79.

3

$121

.3

$144

.3

$80.

2

0102030405060708090

100110120130140150

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

US

Dol

lars

in b

illion

s

Dollar Denominated Non $ Denominated

$ 16

.3$

5.1

$ 12

.2$

0.4

$ 10

.5$

8.8 $

11.5

$ 6.

6$

11.8

$ 7.

4$

16.7

$ 32

.2$

17.0 $

21.9

$ 13

.6$

2.0

$ 11

.2$

5.7

$ 2.

1$

2.8

$ 13

.1$

13.7

$ 25

.0$

20.6

$ 7.

7

0

5

10

15

20

25

30

35

May

-13

Jul-1

3

Sep-

13

Nov

-13

Jan-

14

Mar

-14

May

-14

Jul-1

4

Sep-

14

Nov

-14

Jan-

15

Mar

-15

May

-15

US

Dol

lars

in B

illio

ns

9 High Yield Market

Current Interest Rate Environment

Source: Citi Yieldbook. Note: Dotted lines represent 20 yr. Average

10 High Yield Market

US Leveraged Loan Market Update

11 High Yield Market

Equity Capital Markets

Major Asset Valuations: Bubble Time? Our strategists see European credit in bubble territory, but equities still have much further to run and commodities look cheap vs history.

Credit Approaching Bubble Territory, but Equities have Further to Go

-2

-1

0

1

2

3

4

Glo

bal T

MT

(200

0)

EM (2

007)

Japa

n (1

989)

10yr

BTP

10yr

Bon

os

10yr

OA

T

EUR

Inv

Gra

de

10yr

Bun

d

US

Inv

Gra

de

EUR

HY

10yr

US

T

US

HY

DM

Equ

ities

EMBI

Gol

d

EM E

quiti

es

Base

Met

als

Cru

de O

il

Z-Scores

Previous Bubbles

Expensive Rel to History

Cheap Rel to History

Bubble Threshold

Easy Monetary Policy… Global Excess Liquidity (Global Money Supply Growth less Nominal GDP)

…has Taken Net Issuance to Zero Net Issuance of New Securities Minus Central Bank Interventions, 12m Rolling, $tn

Further Upside for European Equities Price to Book Value: Standard Deviation From 10y Average

Source: Citi

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15

-3

-2

-1

0

1

2

3

4

5

03 05 07 09 11 13 15

Central BankInterventions

Net

Govt.

Non-finBonds

SharesFin. Bonds

GSEs

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

USA

Glo

bal

Eurx

UK

Japa

n

UK

Aust

ralia EM

Market ex financials

Bubble Threshold

12 Equity Capital Markets

84

334

61

277

60

260

45

245

iBoxx € Corp iBoxx € HY iTraxx Main iTraxx Xover

Current 2015F

Market Outlook for 2015

Source: Factset, as of May 2015, Citi Research

Citi Equity Strategists See Positive Outlook for Equities in 2015

ECB Policy Action and continued inflows into European equity funds should support economic and earnings growth and therefore positive European equity performance in 2015. Credit spreads are also expected to rally considerably across the IG and HY space.

Key Themes for 2015

Tighter European Credit Outlook… “Where Will Spreads End 2015?” – Citi Credit Survey Nov-14/Feb-15

Citi Credit Forecasts for 2015

Index Target Upside Index Target Upside

Stoxx 600 450 10% Topix Japan 1,650 2%S&P 500 2,200 4% MSCI EM 1,100 5%FTSE 100 7,700 10% MSCI AC World 525 20%

• Citi equity strategists remain optimistic on European equities – there are 3 “QEs” influencing stock prices right now – Supportive oil price environment resulting in lower raw materials costs – EUR / USD development which support US into Europe assets flows – Actual ECB QE programme

• European equities have re-rated sharply since mid-12, from 10x P/E to 17-18x – but some upside still remains – Stoxx 600 year end target of 550

Citi End 2015 Target Indicates further upside potential especially in Europe

Oil Prices: Stable in 2015, Rally in 2016

3

ECB QE (Driving Search for Yield)

1

Greek Debt Financing (Long Term Effects)

2

Economic Growth: Europe vs US

5

Timing of US rate hikes 4

Concerns over low inflation 7

Weak Euro/Strong USD 6

M&A financing to assume a position of prevalence

8 -50

0

50

100

150

200

Jan 13 Apr 13 Aug 13 Dec 13 Apr 14 Aug 14 Dec 14 Apr 15Cum

ulat

ve F

low

to E

quity

Fun

ds ($

bn)

North America Europe

March witnessed the highest level of inflows since 1996, which will continue to underpin relative outperformance.

Cumulative Asset Inflows from US into Europe

13 Equity Capital Markets

Italy18%

France13%

Germany12%

Spain11%

UAE9%

Nordics6%

SA3%

Other26%

Equity-Linked Market Low rates, rising equity markets and a supply/demand imbalance in the European CB market has resulted in increasing valuations across primary and secondary markets and has allowed issuers to achieve very attractive terms.

Source: Citi, Bloomberg

EMEA Structural Net Supply / Demand Imbalance Overhang

Date Issuer Rating Country Type Size (mm) YTM Premium 20 May 15 Ablynx NR Belgium CB €100 3.250% 26.5% 20 May 15 AMX / KPN A2/A-/A Mexico EB €3,000 0.000% 45.0% 12 May 15 Maurel et Prom NR France CB €115 2.750% 37.0% 06 May 15 Salvepar NR France CB €150 1.625% 37.5% 06 May 15 Haniel / Metro Ba1/BB+ Germany EB €500 -0.540% 37.0% 06 May 15 Tikehau NR France Pre-IPO CB €200 1.300% 35.0% 27 Apr 15 Aroundtown NR Cyprus Pre-IPO CB €431 4.240% 30.7% 09 Apr 15 Unibail-Rodamco NR/A France CB €500 -0.070% 37.0% 25 Mar 15 Heidelberger Druck. B3/B Germany CB €58.6 5.250% 30.0% 24 Mar 15 Market Tech NR UK CB £112.5 4.250% 16.5% 23 Mar 15 Aabar / UniCredit NR UAE EB €1,000 1.000% 40.0% 23 Mar 15 Aabar / UniCredit NR UAE EB €1,000 0.500% 40.0% 19 Mar 15 Telecom Italia Ba1/BB+ Italy CB €2,000 1.125% 70.0% 24 Feb 15 Abengoa / ABY B2/B Spain EB $279 5.125% 20.0% 18 Feb 15 Outokumpu NR Finland CB €250 3.250% 30.0% 11 Feb 15 RAG / Evonik NR Germany EB €500 -0.170% 35.0% 03 Feb 15 Orpar / Remy NR France EB €170 0.500%1 32.5% 12 Dec 14 Carillion NR UK CB £170 2.500% 25.0% 10 Dec 14 FCA B1/BB- Italy MCB $2,875 7.875% 17.5% 14 Nov 14 J Sainsbury NR UK CB £450 1.250% 32.5% 12 Nov 14 Playtech NR UK CB €297 0.500% 27.5% 07 Nov 14 PrimeCity Inv. NR Cyprus CB €100 5.750% n/a 23 Sep 14 BKW NR Switz. CB CHF163 0.125% 22.5% 23 Sep 14 E.ON / BKW A3/A- Germany EB €113 -0.248% 22.5% 17 Sep 14 Meyer Burger NR Switz. CB CHF100 4.000% 27.5% 11 Sep 14 Telefonica Baa2/BBB Spain MCB €1,500 4.900% 22.5% 05 Sep 14 SAF Holland NR Germany CB €100 1.000% 20.0%

Note(1) Premium redemption bond, hence zero coupon

Key Issue Trends Geographical Split 2014-2015YTD

A18%

BBB12%

BB14%B

13%CCC1%

NR42%

Premium

Rating of New Issues 2014-2015YTD

Coupon Primary CB Valuation Metrics Have Continued to Improve

2.4%2.1%2.6% 2.7% 2.4%

5.4% 4.8%4.0% 4.6%

3.1% 2.6%1.8%

1.7%

53 2 3

50 0 0

10 3

11

5

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

AverageNo. of Zero Coupon Deals Surge of zero

coupon deals

Negative Yield

38%29%

23% 23%31%

26% 28% 27%20%

28% 28% 29%

56%

100%

65%51%

60% 55% 55%

41%38% 40%

45% 43% 46%

70%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Average MaxAlcatel 4.750% €1.0bn CB

Telecom Italia 1.125% €2.0bn CB 19.5

28.441.2

23.031.9

14.9 8.816.9

23.3 20.2

10.4

36.926.0

16.6 20.4 19.7 21.7 16.4 16.3 11.922.3 19.7

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

EU

R b

n

Issuance Redemptions Net Flow

Recent Equity-Linked New Issue Supply

14 Equity Capital Markets

Conclusion

Key Takeaways

Bank capital remains constrained. Differential between banks looking to exit the market and “asset-hungry” banks looking to grow their loan books i

Export Credit Agency Financing remains an indispensable source of funding for shipping & offshore asset owners ii

High Yield Market current characterised by high volumes and historically low yields – growing source of financing for shipping & offshore companies iii

Equity upside in Europe versus growing risk of a credit bubble iv

Attractive pricing for equity-linked instruments driven by supply / demand imbalance v

Key Takeaways / Considerations

15 Conclusion

IRS Circular 230 Disclosure: Citigroup Inc. and its affiliates do not provide tax or legal advice. Any discussion of tax matters in these materials (i) is not intended or written to be used, and cannot be used or relied upon, byyou for the purpose of avoiding any tax penalties and (ii) may have been written in connection with the "promotion or marketing" of any transaction contemplated hereby ("Transaction"). Accordingly, you should seek advicebased on your particular circumstances from an independent tax advisor.

In any instance where distribution of this communication is subject to the rules of the US Commodity Futures Trading Commission ("CFTC"), this communication constitutes an invitation to consider entering into a derivativestransaction under U.S. CFTC Regulations §§ 1.71 and 23.605, where applicable, but is not a binding offer to buy/sell any financial instrument.

Any terms set forth herein are intended for discussion purposes only and are subject to the final terms as set forth in separate definitive written agreements. This presentation is not a commitment to lend, syndicate a financing, underwrite orpurchase securities, or commit capital nor does it obligate us to enter into such a commitment, nor are we acting as a fiduciary to you. By accepting this presentation, subject to applicable law or regulation, you agree to keep confidential theinformation contained herein and the existence of and proposed terms for any Transaction.

Prior to entering into any Transaction, you should determine, without reliance upon us or our affiliates, the economic risks and merits (and independently determine that you are able to assume these risks) as well as the legal, tax and accountingcharacterizations and consequences of any such Transaction. In this regard, by accepting this presentation, you acknowledge that (a) we are not in the business of providing (and you are not relying on us for) legal, tax or accounting advice, (b)there may be legal, tax or accounting risks associated with any Transaction, (c) you should receive (and rely on) separate and qualified legal, tax and accounting advice and (d) you should apprise senior management in your organization as tosuch legal, tax and accounting advice (and any risks associated with any Transaction) and our disclaimer as to these matters. By acceptance of these materials, you and we hereby agree that from the commencement of discussions withrespect to any Transaction, and notwithstanding any other provision in this presentation, we hereby confirm that no participant in any Transaction shall be limited from disclosing the U.S. tax treatment or U.S. tax structure of such Transaction.

We are required to obtain, verify and record certain information that identifies each entity that enters into a formal business relationship with us. We will ask for your complete name, street address, and taxpayer ID number. We may alsorequest corporate formation documents, or other forms of identification, to verify information provided.

Any prices or levels contained herein are preliminary and indicative only and do not represent bids or offers. These indications are provided solely for your information and consideration, are subject to change at any time without notice and arenot intended as a solicitation with respect to the purchase or sale of any instrument. The information contained in this presentation may include results of analyses from a quantitative model which represent potential future events that may ormay not be realized, and is not a complete analysis of every material fact representing any product. Any estimates included herein constitute our judgment as of the date hereof and are subject to change without any notice. We and/or ouraffiliates may make a market in these instruments for our customers and for our own account. Accordingly, we may have a position in any such instrument at any time.

Although this material may contain publicly available information about Citi corporate bond research, fixed income strategy or economic and market analysis, Citi policy (i) prohibits employees from offering, directly or indirectly, a favorable ornegative research opinion or offering to change an opinion as consideration or inducement for the receipt of business or for compensation; and (ii) prohibits analysts from being compensated for specific recommendations or views contained inresearch reports. So as to reduce the potential for conflicts of interest, as well as to reduce any appearance of conflicts of interest, Citi has enacted policies and procedures designed to limit communications between its investment banking andresearch personnel to specifically prescribed circumstances.

[TRADEMARK SIGNOFF: add the appropriate signoff for the relevant legal vehicle]

© 2015 Citigroup Global Markets Inc. Member SIPC. All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

© 2015 Citibank, N.A. All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

© 2015 Citigroup Inc. All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

© 2015 Citigroup Global Markets Limited. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

© 2015 Citibank, N.A. London. Authorised and regulated by the Office of the Comptroller of the Currency (USA) and authorised by the Prudential Regulation Authority. Subject to regulation by the Financial Conduct Authority and limited regulation by the Prudential Regulation Authority. Details about the extent of our regulation by the Prudential Regulation Authority are available from us on request. All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

© 2015 [Name of Legal Vehicle] [Name of regulatory body.] All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

Citi believes that sustainability is good business practice. We work closely with our clients, peer financial institutions, NGOs and other partners to finance solutions to climate change, develop industry standards, reduce our own environmental footprint, and engage with stakeholders to advance shared learning and solutions. Highlights of Citi's unique role in promoting sustainability include: (a) releasing in 2007 a Climate Change Position Statement, the first US financial institution to do so; (b) targeting $50 billion over 10 years to address global climate change: includes significant increases in investment and financing of renewable energy, clean technology, and other carbon-emission reduction activities; (c) committing to an absolute reduction in GHG emissions of all Citi owned and leased properties around the world by 10% by 2011; (d) purchasing more than 234,000 MWh of carbon neutral power for our operations over the last three years; (e) establishing in 2008 the Carbon Principles; a framework for banks and their U.S. power clients to evaluate and address carbon risks in the financing of electric power projects; (f) producing equity research related to climate issues that helps to inform investors on risks and opportunities associated with the issue; and (g) engaging with a broad range of stakeholders on the issue of climate change to help advance understanding and solutions.

Citi works with its clients in greenhouse gas intensive industries to evaluate emerging risks from climate change and, where appropriate, to mitigate those risks.

efficiency, renewable energy and mitigation