Filed
pursuant to Rule 433
March
5, 2008
Relating
to Preliminary Pricing Supplement No. 551 to
Registration
Statement Nos. 333-137691, 333-137691-02
Dated
September 29, 2006
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ABN AMRO Bank N.V. Reverse Exchangeable
Securities
S-NOTESSM
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Preliminary Pricing Sheet – March 5,
2008
12.75%% (ANNUALIZED) THREE MONTH APPLE INC.
KNOCK-IN REXSM
SECURITIES DUE JUNE 30, 2008
OFFERING
PERIOD: MARCH 5, 2008 – MARCH 26, 2008
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SUMMARY
INFORMATION
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Issuer:
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ABN AMRO Bank N.V. (Senior Long
Term Debt Rating: Moody’s Aa2, S&P
AA-)
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Lead Agent:
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ABN AMRO
Incorporated
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Offerings:
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12.75% (Per Annum), Three Month
Reverse Exchangeable Securities due June 30, 2008 linked to the Underlying
Stock set forth in the table below.
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Interest Payment
Dates:
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Interest on the Securities is
payable monthly in arrears on the last day of each month starting on April
30, 2008 and ending on the Maturity Date
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Underlying
Stock
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Ticker
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Coupon Rate Per
annum*
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Interest
Rate
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Put Premium
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Knock-in
Level
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CUSIP
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ISIN
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Apple Inc.
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AAPL
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12.75%
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2.91%
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9.84%
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75%
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00083GFQ2
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US00083GFQ29
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*This Security has a term of three
months, so you will receive a pro rated amount of this per annum rate
based on such three-month period.
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Denomination/Principal:
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$1,000
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Issue
Price:
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100%
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Payment at
Maturity:
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The payment at maturity for each
Security is based on the performance of the Underlying Stock linked to
such Security:
i) If the
closing price of the Underlying Stock on the primary U.S. exchange or
market for such
Underlying Stock has not fallen below the Knock-In Level on any trading
day from but not including the Pricing Date to and including the
Determination Date, we will pay you the principal amount of each Security
in cash.
ii) If the
closing price of the Underlying Stock on the primary
U.S. exchange or market for such Underlying Stock has fallen below the
Knock-In Level on any trading day from but not including the Pricing Date
to and including the Determination Date:
a) we will
deliver to you a number of shares of the Underlying Stock
equal to the Stock Redemption Amount, in the event that the closing price
of the Underlying Stock on the Determination Date is below the Initial
Price; or
b) We will
pay you the principal amount of each Security in cash, in the event that the closing price of
the Underlying Stock on the Determination Date is at or above the Initial
Price.
You will receive cash in lieu of
fractional shares. If due to events beyond our reasonable control, as
determined by us in our sole discretion, shares of the Underlying Stock
are not available for delivery at maturity we may pay you, in lieu of the
Stock Redemption Amount, the cash value of the Stock Redemption Amount,
determined by multiplying the Stock Redemption Amount by the Closing
Price of the Underlying Stock on the
Determination Date.
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Initial
Price:
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100% of the Closing Price of the
applicable Underlying Stock on the Pricing Date.
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Stock Redemption
Amount:
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For each $1,000 principal amount
of Security, a number of shares of the applicable Underlying Stock linked
to such Security equal to $1,000 divided by the applicable Initial
Price.
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Knock-In
Level:
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A percentage of the applicable
Initial Price as set forth in the table above.
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Indicative Secondary
Pricing:
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•
Internet at: www.s-notes.com
Bloomberg at: REXS2 <GO>
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Status:
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Unsecured, unsubordinated
obligations of the Issuer
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Trustee:
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Wilmington Trust
Company
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Securities
Administrator:
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Citibank,
N.A.
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Settlement:
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DTC, Book Entry,
Transferable
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Selling
Restrictions:
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Sales in the European Union must
comply with the Prospectus Directive
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Proposed Pricing
Date:
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March 26, 2008 subject to certain
adjustments as described in the related pricing
supplement
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Proposed Settlement
Date:
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March 31,
2008
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Determination
Date:
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June 25, 2008 subject to certain
adjustments as described in the related pricing supplement
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Maturity
Date:
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June 30, 2008 (Three
Month)
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ABN
AMRO has filed a registration statement (including a Prospectus and Prospectus
Supplement) with the SEC for the offering to which this communication relates.
Before you invest, you should read the Prospectus and Prospectus Supplement in
that registration statement and other documents ABN AMRO has filed with the SEC
for more complete information about ABN AMRO and the offering of the
Securities.
You
may get these documents for free by visiting EDGAR on the SEC web site at
www.sec.gov. Alternatively, ABN AMRO, any underwriter or any dealer
participating in the offering will arrange to send you the Prospectus and
Prospectus Supplement if you request it by calling toll free (888)
644-2048.
These
Securities may not be offered or sold (i) to any person/entity listed on
sanctions lists of the European Union, United States or any other applicable
local competent authority; (ii) within the territory of Cuba, Sudan, Iran and
Myanmar; (iii) to residents in Cuba, Sudan, Iran or Myanmar; or (iv) to Cuban
Nationals, wherever located.
SUMMARY
The
following summary does not contain all the information that may be important to
you. You should read this summary together with the more detailed information
that is contained in the related Pricing Supplement and in its accompanying
Prospectus and Prospectus Supplement. You should carefully consider, among other
things, the matters set forth in “Risk Factors” in the related Pricing
Supplement, which are summarized on page 5 of this document. In
addition, we urge you to consult with your investment, legal, accounting, tax
and other advisors with respect to any investment in the
Securities.
What
are the Securities?
The
Securities are interest paying, non-principal protected securities issued by us,
ABN AMRO Bank N.V., and are fully and unconditionally guaranteed by our parent
company, ABN AMRO Holding N.V. The Securities are senior notes of ABN AMRO Bank
N.V. These Securities combine certain features of debt and equity by offering a
fixed interest rate on the principal amount while the payment at maturity is
determined based on the performance of the Underlying Stock to which it is
linked.
What
will I receive at maturity of the Securities?
The
payment at maturity of each Security will depend on (i) whether or not the
closing price of the Underlying Stock to which such Security is linked fell
below the knock-in level on any trading day during the Knock-in Period, and if
so, (ii) the closing price of the applicable Underlying Stock on the
determination date. To determine closing prices, we look at the
prices quoted by the relevant exchange.
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•
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If the closing
price of the applicable Underlying Stock on the relevant exchange has not
fallen below the applicable knock-in level on any trading day during the
Knock-in Period, we will pay you the principal amount of each Security in
cash.
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If the closing
price of the applicable Underlying Stock on the relevant exchange has
fallen below the applicable knock-in level on any trading day during the
Knock-in Period, we will
either:
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deliver to you
the applicable stock redemption amount, in exchange for each Security, in
the event that the closing price of the applicable Underlying Stock is
below the applicable initial price on the determination date;
or
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•
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pay you the
principal amount of each Security in cash, in the event that the closing
price of the applicable Underlying Stock is at or above the applicable
initial price on the determination
date.
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If
due to events beyond our reasonable control, as determined by us in our sole
discretion, shares of the Underlying Stock are not available for delivery at
maturity we may pay you, in lieu of the Stock Redemption Amount, the cash value
of the Stock Redemption Amount, determined by multiplying the Stock Redemption
Amount by the Closing Price of the Underlying Stock on the Determination
Date.
Why
is the interest rate on the Securities higher than the interest rate payable on
your conventional debt securities with the same maturity?
The
Securities offer a higher interest rate than the yield that would be payable on
a conventional debt security with the same maturity issued by us or an issuer
with a comparable credit rating. This is because you, the investor in the
Securities, indirectly sell a put option to us on the shares of the applicable
Underlying Stock. The premium due to you for this put option is combined with a
market interest rate on our senior debt to produce the higher interest rate on
the Securities.
What
are the consequences of the indirect put option that I have sold
you?
The
put option you indirectly sell to us creates the feature of exchangeability. If
the closing price of the applicable Underlying Stock on the relevant exchange
falls below the applicable Knock-In Level on any trading day during the Knock-In
Period, and on the Determination Date the closing price of the applicable
Underlying Stock is less than the applicable Initial Price, you will receive the
applicable Stock Redemption Amount. The market value of the shares of
such Underlying Stock at the time you receive those shares will be less than the
principal amount of the Securities and could be zero. Therefore you are not
guaranteed to receive any return of principal at maturity.
How
is the Stock Redemption Amount determined?
The
Stock Redemption Amount for each $1,000 principal amount of any Security is
equal to $1,000 divided by the Initial Price of the Underlying Stock linked to
such Security. The value of any fractional shares of such Underlying Stock that
you are entitled to receive, after aggregating your total holdings of the
Securities linked to such Underlying Stock, will be paid in cash based on the
closing price of such Underlying Stock on the Determination Date.
What
interest payments can I expect on the Securities?
The
interest rate is fixed at issue and is payable in cash on each interest payment
date, irrespective of whether the Securities are redeemed at maturity for cash
or shares.
Can
you give me an example of the payment at maturity?
If,
for example, in a hypothetical offering, the interest rate was 10% per annum,
the initial price of a
share of underlying
stock was $45.00 and the knock-in level for such offering was 80%, then the
stock redemption amount would be 22.222 shares of underlying stock, or $1,000
divided by $45.00, and the knock-in level would be $36.00, or 80% of the initial
price.
If
the closing price of that hypothetical underlying stock fell below the knock-in
level of $36.00 on any trading day during the Knock-in Period, then the payment
at maturity would depend on the closing price of the underlying stock on the
determination date. In this case, if the closing price of the underlying stock
on the determination date is $30.00 per share at maturity, which is below the
initial price level, you would receive 22.222 shares of underlying stock for
each $1,000 principal amount of the securities. (In actuality, because we cannot
deliver fractions of a share, you would receive on the maturity date for each
$1,000 principal amount of the securities 22 shares of underlying stock plus
$6.66 cash in lieu of 0.222 fractional shares, determined by multiplying 0.222
by $30.00, the closing price per shares of underlying stock on the determination
date.) In addition, over the life of the securities you would have received
interest payments at a rate of 10% per annum. In this hypothetical example, the
market value of those 22 shares of underlying stock (including the cash paid in
lieu of fractional shares) that we would deliver to you at maturity for each
$1,000 principal amount of security would be $666.66, which is less than the
principal amount of $1,000, and you would have lost a portion of your initial
investment. If, on the other hand, the closing price of the
underlying stock on the determination date is $50.00 per share, which is above
the initial price level, you will receive $1,000 in cash for each $1,000
principal amount of the securities regardless of the knock-in level having been
breached. In addition, over the life of the Securities you would have received
interest payments at a rate of 10% per annum.
Alternatively, if
the closing price of the underlying stock never falls below $36.00, which is the
knock-in level, on any trading day during the Knock-in Period, at maturity you
will receive $1,000 in cash for each security you hold regardless of the closing
price of the underlying stock on the determination date. In addition, over the
life of the securities you would have received interest payments at a rate of
10% per annum.
This example is for illustrative
purposes only and is based on a hypothetical offering. It is not
possible to predict the closing price of any of the Underlying Stocks on the
determination date or at any time during the life of the Securities. For
each offering, we will set the Initial Price, Knock-In Level and Stock
Redemption Amount on the Pricing Date.
Do
I benefit from any appreciation in the Underlying Stock over the life of the
Securities?
No.
The amount paid at maturity for each $1,000 principal amount of the Securities
will not exceed $1,000.
What
if I have more questions?
You
should read the “Description of Securities” in the related Pricing Supplement
for a detailed description of the terms of the Securities. ABN AMRO
has filed a registration statement (including a Prospectus and Prospectus
Supplement) with the SEC for the offering to which this communication relates.
Before you invest, you should read the Prospectus and Prospectus Supplement in
that registration statement and other documents ABN AMRO has filed with the SEC
for more complete information about ABN AMRO and the offering of the
Securities. You may get these documents for free by visiting EDGAR on
the SEC web site at www.sec.gov. Alternatively, ABN AMRO, any underwriter or any
dealer participating in the offering will arrange to send you the Prospectus and
Prospectus Supplement if you request it by calling toll free (888)
644-2048.
RISK
FACTORS
Investors
should carefully consider the risks of the Securities to which this
communication relates and whether these Securities are suited to their
particular circumstances before deciding to purchase them. It is
important that prior to investing in these Securities investors read the Pricing
Supplement related to such Securities and the accompanying Prospectus and
Prospectus Supplement to understand the actual terms of and the risks associated
with the Securities. In addition, we urge investors to consult with
their investment, legal, accounting, tax and other advisors with respect to any
investment in the Securities.
Credit Risk
The Securities are issued by ABN AMRO
Bank N.V. and guaranteed by ABN AMRO Holding N.V., ABN AMRO’s parent. As a result,
investors assume the credit risk of ABN AMRO Bank N.V. and that of ABN AMRO
Holding N.V. in the event
that ABN AMRO defaults on its obligations under the Securities. Any obligations
or Securities sold, offered, or recommended are not deposits on ABN AMRO Bank
N.V. and are not endorsed or guaranteed by any bank or thrift, nor are they
insured by the FDIC or any governmental
agency.
Principal Risk
The Securities are not ordinary debt
securities: they are not principal protected. In addition, if the closing price of the applicable
Underlying Stock falls below the applicable Knock-In Level on any trading day
during the Knock-In Period, investors in the Securities will be exposed to any
decline in the price of the applicable Underlying Stock below the closing price of such Underlying
Stock on the date the Securities were priced. Accordingly,
investors may lose some or all of their initial investment in the
Securities.
Limited Return
The amount payable under the Securities
will never exceed the
original principal amount of the Securities plus the applicable aggregate fixed
coupon payment investors earn during the term of the Securities. This
means that investors will not benefit from any price appreciation in the
applicable Underlying Stock, nor will they receive dividends
paid on the applicable Underlying Stock, if any. Accordingly,
investors will never receive at maturity an amount greater than a predetermined
amount per Security, regardless of how much the price of the applicable
Underlying Stock increases during the term
of the Securities or on the Determination Date. The return of a
Security may be significantly less than the return of a direct investment in the
Underlying Stock to which the Security is linked during the term of
the Security.
Liquidity Risk
ABN AMRO does not intend to list the
Securities on any securities exchange. Accordingly, there may be
little or no secondary market for the Securities and information regarding
independent market pricing of the Securities may be limited. The value of the
Securities in the secondary market, if any, will be subject to many
unpredictable factors, including then prevailing market
conditions.
It is important to
note that many factors will contribute to the secondary market value
of the
Securities, and investors may not receive their full principal back if the
Securities are sold prior to maturity. Such factors include, but are not
limited to, time to maturity, the price of the applicable Underlying Stock,
volatility and interest rates.
In addition, the price, if any, at which
we or another party are willing to purchase Securities in secondary market
transactions will likely be lower than the issue price, since the issue price
included, and secondary market prices are likely to exclude, commissions, discounts or
mark-ups paid with respect to the Securities, as well as the cost of hedging our
obligations under the Securities.
Tax Risk
Pursuant to the terms of the Knock-in
Reverse Exchangeable Securities, we and every investor agree to characterize the Securities
as consisting of a Put Option and a Deposit of cash with the
issuer. Under this characterization, a portion of the stated interest
payments on each Security is treated as interest on the Deposit, and the
remainder is treated as attributable to a sale by
the investor of the Put Option to ABN AMRO (referred to as Put
Premium). Receipt of the Put Premium will not be taxable upon
receipt.
If the Put Option expires unexercised
(i.e., a cash payment of the principal amount of the Securities is made to the
investor at maturity), the investor will recognize short-term capital gain equal
to the total Put Premium received. If the Put Option is exercised
(i.e., the final payment on the Securities is paid in the applicable
Underlying Stock), the investor will not
recognize any gain or loss in respect of the Put Option, but the
investor’s tax basis in the applicable Underlying
Stock received will be reduced by the Put Premium received.
Significant aspects of the U.S.
federal income tax
treatment of the Securities are uncertain, and no assurance can be given that
the Internal Revenue Service will accept, or a court will uphold, the tax
treatment described above.
This summary is limited to the federal
tax issues addressed herein. Additional issues may
exist that are not addressed in this summary and that could affect the federal
tax treatment of the transaction. This tax summary was written in
connection with the promotion or marketing by ABN AMRO Bank N.V. and the placement agent of the Knock-in Reverse
Exchangeable Securities, and it cannot be used by any investor for the purpose
of avoiding penalties that may be asserted against the investor under the
Internal Revenue Code. Investors should seek
their own advice based on their particular
circumstances from an independent tax advisor.
On December 7, 2007, the U.S. Treasury
and the Internal Revenue Service released a notice requesting comments on the
U.S. federal income tax treatment of “prepaid forward contracts” and similar instruments. While it is
not entirely clear whether the Securities are among the instruments described in
the notice, it is possible that any Treasury regulations or other guidance
issued after consideration of the issues raised in the notice could materially and adversely affect the tax
consequences of ownership and disposition of the Securities, possibly on a
retroactive basis.
The notice indicates that it is possible
the IRS may adopt a new position with respect to how the IRS characterizes
income or loss (including,
for example, whether the option premium might be currently included as ordinary
income) on the Securities for U.S. holders of the
Securities.
You should consult your tax advisor
regarding the notice and its potential implications for an investment in the
Securities.
Reverse Exchangeable is a Service Mark
of ABN AMRO Bank N.V.
5