Banco Best (Banco Electronico de Servicio Total) is marketing its first credit default product, for which it aims to raise up to €10m. The Credit Linked Notes EDP 2013 (CLN EDP 2013) is a three-year note linked to the credit risk of Portuguese energy company Energias de Portugal.
The product pays half-yearly fixed coupons equal to six-month Euribor plus 3.50% pa if the underlying company remains solvent. Should a credit event take place, it stops paying coupons and matures early, repaying capital equal to the recovery value of the company's subordinated bonds. Otherwise, the product repays capital in full at maturity.
This is the fourth Portuguese product with a credit default payoff in 2010: Deutsche Bank gathered €94m with two separate tranches, while Banco BIG and Banco Espirito Santo which raised €2m and €20m, respectively.
Banco Best is a financial institution created in 2001, operating in banking, asset management and trading. Its shareholder structure comprises GBES (66%), Espírito Santo Financial Group (9%) and Saxo Bank (25%). It counts over 56,000 customers and seven investment centres in Portugal.
The product will be available until 11 November for a minimum investment of €1,000.
This product is available now in Recent Additions (Portugal).