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UBS launches SUPER Notes XVI linked to 10 leading Hong Kong-listed China-related companies
UBS today launched SUPER Notes XVI (Series no. 16 - US dollar equity-linked notes due 2008) linked to a basket of 10 well-known China-related companies listed in Hong Kong. The Notes have a minimum coupon of 2% payable after one year and 3% payable after 2.5 years, giving a total minimum return of 5% in 2.5 years and a maximum total return of 20% in 2.5 years.
The potential coupon is linked to the average return of the companies in the basket - PetroChina, Sinopec, CNOOC, China Shenhua Energy, China Mobile, China Unicom, China Telecom, China Netcom, China Life and Ping An Insurance - with a maximum of 8% as the first coupon and 12% as the second coupon. The maximum coupon over the life of the Notes can be as high as 20%.
The coupon payable on the first coupon payment date is the higher of 2% and the average return of the companies in respect of the first coupon calculation date. The return achieved by each company is capped at 8%.
On the second coupon date, the coupon payable is the higher of 3% and the average return of the companies in respect of the second coupon calculation date. The return achieved by each company is capped at 12%.
"The instruments offer the return of principal at maturity, a guaranteed overall coupon and an attractive variable coupon. All these features were included in response to strong demand from our clients - in this case, retail banks - for shortdated guaranteed products for their customers," said Min PARK, Head of Equity Risk Management at UBS, Asia.
"Replicating the structure of the equity-linked deposit launched in mainland China in January this year, the Notes tap into the increasing demand among investors for China-related investment,"," added Thomas FANG, Executive Director of UBS's Risk Management Products (RMPs) Sales team.
Retail investors in Hong Kong may subscribe for the Notes between 15th May and 9th June 2006.
Bank of East Asia; Citibank (Hong Kong); Dah Sing Bank; Hang Seng Bank; MEVAS Bank; Shanghai Commercial Bank and Wing Hang Bank are distributors.
UBS's Equity Risk Management Products team was named the Best Provider of Equity Structured Products by Asiamoney for three consecutive years - 2004, 2005 and 2006. In addition, in a poll published by AsiaRisk, UBS was named Best Wealth Management House for Equity Derivatives 2005 and Best Asia Equity Derivatives House 2005 by Derivatives Week.
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