Product wrap: Funds, gender diversity and household goods

In a new feature, SRP highlights the most interesting structured products in the five regions it covers. In this article, the analysis is of products with strike dates between August 12-18, 2017 and include structures linked to funds, gender diversity and household goods.

Europe
Forty structured products, including private banking but excluding leverage and flow, struck in Europe over the past seven days. The products were split between 10 different jurisdictions and predominately linked to equities (36 products).

Blackbee Investments launched 90% Protected Funds 6, the only product in Europe to be linked to fund this week. Available through self-administered and self-directed pension providers, the investment protects 90% of the nominal invested and includes a 150% participation in an equally-weighted basket comprising Pimco Global Investors Series Income Fund and Jupiter Dynamic Bond Fund. EFG International Finance Guernsey is the issuer while EFG International AG acts as the guarantor of a product that is listed in Frankfurt.

BNP Paribas Fortis teamed up with AG Insurance in Belgium for the launch of Smart invest Bon Women Leadership 2027/2, which is linked to the iStoxx Global Women Leadership Select 30 Index that selects, from the Stoxx Global 1800, the shares of 30 companies that display a relatively high proportion of women at board level, in addition to high dividend and low volatility. The product, which participates 75% in the positive performance of the index, has a 10-year term and is wrapped as a Class 23 life insurance.

In the Czech Republic, ČSOB, the KBC subsidiary, distributed MI - ČSOB Osobní spotřeba a domácnost 1, a unit-linked product linked to the performance of the Stoxx Europe 600 Personal & Household Goods Index. The product offers 55% participation in the performance of the index, subject to an overall minimum capital return of 90% and an overall maximum capital return of 127.5%.

North America
Eighty-five structured products had strike dates in North America this week, including 70 products in the US, with 15 striking in Canada.

HSBC issued the Barrier Enhanced Participation Notes linked to the DJ Industrial Average Index. The notes have an estimated initial value of 96.5% and offer 163% enhanced participation in the rise of the index.
Also in the US, UBS Financial Services distributed Trigger Phoenix Autocallable Optimization Securities - ETF, a one-year income product linked to the SPDR S&P Oil & Gas Exploration & Production ETF. The unlisted registered note collected sales of US$100,000 and offers a 12.14% pa coupon, paid quarterly, providing the exchange-traded fund does not fall by more than 20% from its initial level on the observation date.

National Bank of Canada launched the NBC Autocallable Note, which is linked to a portfolio of five Canadian banks comprising Bank of Montreal, Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada and Toronto Dominion Bank. The product is distributed via National Bank Financial and Desjardins Securities, with the latter acting as independent agent. The principal amount of the note is C$100 while a minimum subscription of C$1,000 applies.

Latin America
The 12 structured products that struck in the Latin American region were all targeted at the Mexican market.

Monex introduced Accrual Range Note, a structured deposit with a term of just one week which was linked to the appreciation of the US dollar relative to the Mexicon peso. At maturity, the product, which sold MXN5.86m (US$0.33m), offers a capital return of 100% plus 8.5% pa prorated for the number of business days in the investment period when the underlying is equal to or greater than 17.755 and equal to or lower than 18.055.

Asia Pacific
Sixty-three structured products had strike dates in the Apac region this week. South Korea, with 60 products, was the busiest market, while the remaining three products were distributed in Japan.
Daegu Bank sold the Daegu Rich ELD 17-30 to investors in South Korea. The equity-linked deposit was linked to the local Kospi 200 and offers a capital return of 102.2% after one-year of investment providing the index trades between 90%-110% of its initial level at maturity. Otherwise, the product offers a 100% capital return.

Also in South Korea, Shinyoung Securities launched the Shinyoung ELS 6600, a three-year equity-linked security which tracks the performance of a basket of four indices: Eurostoxx 50, Kospi 200, Nikkei 225 and S&P 500. The product is distributed in collaboration with KEB Hana Bank and will be redeemed early at the end of each semester if the level of the worst performing index is at or above 95%, 90%, 85%, 85% and 80%, respectively, of its initial level on the first to fifth observation date.

In Japan, Okasan Niigata Securities distributed EB Kusuri no Aoki M20180216, an income product linked to the share of Kusuri no Aoki. The product pays a quarterly coupon of 5.3% pa and will be redeemed early if the share closes at or above its starting level on any quarterly valuation date. The product sold JPY3m (US$27,310) during the subscription period and is issued via Svensk Exportkredit.

Middle East and Africa
Five structured products struck in the Middle East and Africa over the past week. They were all targeted at the South African market.

Standard Bank launched the Capital Escalator One, a five-year structured deposit linked to the FTSE/JSE Africa Top 40. If, at maturity, the index is at or above its initial level, the product offers 160% capital return. However, if at any time during the investment term, the index trades below 50% of its initial level, investors receive the nominal invested less the performance of the index.

North America and Apac lead the way in issuance as Europe is left behind