United Overseas Bank Singapore's latest structured deposit uses a steepener payoff with returns based on the widening curve between long-term and short-term interest rates.
Growth Deposit Series 8 is a 5.5-year, capital-protected deposit linked to the spread between the 5Y SGD swap rate and 2Y SGD swap rate. (The 5Y and 2Y SGD swap rates are the rates for a Singapore dollar swap with a maturity of five and two years, expressed as a percentage respectively.)
The product offers a 1.5% pa coupon, regardless of the performance of the underlying rates and at maturity repays capital plus a potential bonus coupon, calculated as 5Y SGD swap rate minus 2Y SGD swap rate on the observation date, subject to a minimum of zero and a maximum of 3%.
This product is open until 28 August.
This product is available now in Recent Additions (Singapore).