What is an American Depositary Receipt (ADR)?

An American Depositary Receipt (ADR) is a US dollar denominated negotiable certificate that represents ownership of shares in a non-US company. Each ADR is issued by a U.S. depositary bank (which is a bank in the US which oversees all the stock transfer and agency services in connection with a depository receipt program) and represents one or more shares of a foreign stock or a fraction of a share. The price of an ADR is often close to the price of the foreign stock in its home market, adjusted for the ratio of the foreign company’s shares to ADRs. The price of an ADR is also affected by the impact of the price of the US currency. ADRs were specifically designed to facilitate the purchase, holding and sale of non-U.S. securities by US investors. BB’s ADRs represent BB’s voting shares deposited in the depositary bank (BNY Mellon), to underlie such certificates and carry the rights attached to them as detailed in the Deposit Agreement.

In addition, potential buyers of Banco do Brasil’s ADRs should read, with special attention, the reports of the Bank regarding the Risk Factors available on the website: www.bb.com.br/ir, especially the sections “4. Risk Factors” and “5. Risk and Internal Control Management” in the Reference Form.

Updated 12/10/2018 at 03:35 pm