UniCredit and life insurance provider Allianz have launched their first joint structured product as a result of the strategic cooperation initiative started last year between both firms in the Czech Republic.
Allianz EnergyInvest and UniCredit's Clean Energy 2016 are both five-year capital-protected products linked to the UniCredit Clean Energy Risk Reduction Strategy Index. At maturity, this uncapped call will pay 70% participation in the rise in the underlying over the investment period. Allianz is also offering a version with 85% capital protection and 230% participation.
Libor Novak, director at Allianz Life Personal Insurance, told SRP that despite a challenging environment due to low interest rates, sales were in line with expectations. Stepan Nyvlt, structured products manager at UniCredit, said the bank plans to continue issuing its own structured notes depending on market conditions, although "the current environment is not ideal for manufacturing structured products."
The underlying index, UniCredit Clean Energy Risk Reduction Strategy Index, is a proprietary gauge providing exposure to 14 stocks from companies involved in the development or application of new technologies in the industrial energy sector. Share exposure varies as per the volatility target level, set at 8%.
According to SRP data, this is the first time an Allianz product has the bank issuing the underlying bond acting simultaneously as the distributor. It is also the first time UniCredit has used a covered bond in the Czech market to limit the credit risk of the product.
All three versions of the new product are available on the Czech database.