375/2008 Sb.



The COMMUNICATION FROM the



The Ministry of finance



of 3 July 2003. October 2008,



which specify the conditions of the bond of the Czech Republic, 2008-2016,

VAR



The Ministry of Finance issued Treasury bonds in accordance with § 25 of the law No.

190/2004 Coll. on bonds, as amended, (hereinafter referred to as

"the law on bonds") and specifies the terms and conditions of the bond of the Czech

Republic, 2008-2016, VAR:



1. basic characteristics of the bonds:



Issuer: Czech Republic represented by the Ministry of finance



Name: Bond of the Czech Republic, 2008-2016, VAR



Short name: the CZECH REPUBLIC, VAR, 16



Serial number of the emission: 55.



Nominal value: £ 10,000



Form of a bond: bearer securities



Form of a bond: book-entry securities



Issuing date: 27. October 2008



Due date: 27. October 2016



Interest income: coupon with floating rate



The taxation of interest income: according to the legislation of the Czech Republic



Isin: CZ0001002331



2. Bonds are within the meaning of § 25 para. 2 of the Act on bonds issued

on the basis of special legislation, which release Government bonds.



3. the following shall be added to the bearer Bonds and are issued in book-entry form.

The register of owners of securities Centre leads.



4. Bonds may acquire legal and natural persons established or

resident in the territory of the Czech Republic and abroad. Repatriation of proceeds and

paid-up nominal values abroad will be carried out according to legal

the laws of the United States.



5. the issuer shall make a proposal on the adoption of the bonds to trading on the

market of the Prague stock exchange, a. s.



6. Bonds are interest-bearing variable interest rate. The reference rate

6 m PRIBOR rate is fixed at 6 months, valid for one

the yield of the period. Interest income is paid twice a year, to

27. April and 27. October of the year concerned. If the date of payment would yield

on a day which is not a business day, the payment will be made the first

the following working day without the right to return for this postponement of the payment.



7. for the first six-month period, the interest rate will be determined in the

the day of the auction. For the following six-month period, the interest rate yield

fixed 2 working days before the beginning of a new period, on the day of the income

the determination will be published.



8. The record date for the payment of the proceeds of the bond is preceded by one month

days to maturity yield from the bond. Ex-coupon date is the day following the

the closing date is set at 28. March and 28. September. Interest income

always receives the investor who is the owner of the bond 27. March and 27.

September of each year. Interest income for the first period from the issue date to 27.

April 2009 will receive an investor who is the owner of the bond 27. March

2009.



9. transferability of the bonds in the securities Center, beginning on the day

credited to the accounts of the first owners of the bonds. The last day will be

experience to transfer securities on accounts in securities Centre

papers, is 27. September 2016.



10. calculation of aliquot interest rate is based on one year of 360

days, and the actual number of days in period (BCK-standard act/360). The relative

part of the interest income is added to the price of a bond calculated from the date of issue.



11. Bonds to be issued after each of the sections (tranches).

The primary sale of 1. the tranche will be made in the form of American auction organized by the

The Czech National Bank for a group of actors on 22 November. October 2008.

Other investors may participate in the auction via direct

participants. Notice of the auction and the list of direct participants in advance

disclosed to the public. The primary sale of other tranches will be carried out under the same

terms and conditions. Emission time limit expire on 27. September 2016.



12. Each order passed to auction direct participants are

met gradually from the highest price offered. When the progressive

meeting the orders with a specific price would be "offered volume

orders exceeded the volume of bonds, which are sold by the issuer

order with this push the price only in partial

the range. The bonds are sold at the prices offered.



13. The total volume of issue of bonds is 40 000 000 000 CZK.

Bonds may be issued in a small or large volume in accordance with §

11 of the Act on the bonds in a range that will respond to the development and

the structure of the funding of the national debt. The volume of emissions may be increased

up to 80 000 000 000 CZK.



14. The valid assessment of financial eligibility (rating) of long-term

on CZK-denominated liabilities on the date of release of these emission conditions made

by Standard Poor's & is level A +, Moody's on

level A1.



15. The Department of Justice on the yield of a bond pursuant to section 18 of the Act on bonds

It is not allowed.



16. The Ministry of finance declares that he owes to each owner

Bond nominal value of the bond. The bonds will be repaid in

the nominal value at the date of 27. October 2016. From this day ends with the remuneration

bonds. The nominal value of the bond, together with the last interest

the proceeds will be paid to the investor, which is the owner of the bond of the day

September 27, 2016. If the day falls on the day of repayment of principal, which is not

business day, the payment of the first following working day

without the right to return for this postponement of the payment.



17. Any and all rights associated with the bonds and coupons are issued to them in

pursuant to section 42 of the Act on bonds forfeited in the expiry of 10 years from the

the date on which it could be invoked for the first time.



18. The Ministry of finance is committed to secure the payment of interest

the proceeds of the bonds and repay the nominal value of the bonds of their

According to the owners of these emission conditions. Payment is

National Bank. Coupons and the principal of the bonds are paid by direct debit

transfer or in cash, according to the instructions of the owner of the bond.

Payment instead shall publish the manner in which payment of the coupon and redemption

the nominal value is executed.



19. Bonds are direct, unconditional and nepodřízenými liabilities

States that are on the same level with all the other existing

and future direct, unconditional and nepodřízenými liabilities

of the Republic.



20. the notification to the public about these bonds will be

published in newspapers or other similarly focused

the journal, commonly available in the Czech Republic and in a manner allowing

remote access.



21. these terms and conditions may be translated into foreign languages. If there is a

a conflict between the various language versions, the issue conditions

Czech version.



Minister:



Ing. Kalousek in r.