Fifty-one out of the total 107 matured structured deposits in 2014 offered an annualised return higher than plain vanilla deposits with similar terms sold by the same banks. Fifty-two deposits offered an annualised return lower and for four the return was equal to plain vanilla deposits with similar terms sold by the same banks, according to a Bank of Portugal report (Relatório de Acompanhamento dos mercados bancários de retalho).

Fifty-one out of the total 107 matured deposits in 2014 paid the minimum return indicated in their final terms, of which 12 paid no return and 26 deposits paid the maximum potential return. The remaining paid a return in the range of pre-announced TANB in the respective final terms.

Source: Relatório de Acompanhamento dos mercados bancários de retalho 2014. Bank of Portugal

According to the report, 107 structured deposits with a value of €12.22bn, which were purchased by 80,876 private investors and 623 institutions, matured in the Portuguese market in 2014. The report also revealed that almost 64% of the structured deposits maturing in 2014 had one-year terms. The average return for one-year deposits was between 0% and 11.74%. For the remaining terms, (one month, three, six and 18 months and two, three and four years), average returns were between 0% and 1.7%. Moreover, 22 dual deposit structures with a value of €89.2m which were purchased by 23,000 investors also matured in the Portuguese market in 2014. Such products with terms between one month and three years paid €6.2m gross remuneration.

According to SRP data, the highest return registered in the Portuguese market in 2014 was 11.71% pa, paid out by Banco Invest’s Invest Selecção Portugal (Ser. 13/1), a knockout deposit linked to a basket of five shares comprising Banco Comercial Portugues, Banco Espirito Santo, Banco BPI, Energias de Portugal and Semapa.

According to the SRP database, 72.8% of the maturing deposits were linked to equities, which delivered an average annual return of 3.12%. Deposits linked to FX rates came second, with 10.52% of total issuance, and returned an average annual yield of 2.77%. Interest rate-linked deposits, 9.64% of the total issuance, paid out an average annual return equal of 3.11%, while 4.38% were hybrid with an average annual return of 1.18%, and the highest average annual return, 4.23%, was for commodity-linked products, which had 2.63% of total issuance.

Besides the 107 deposits mentioned above, 96 notes with an average annualised return of 5.25% also matured in 2014, according to SRP data.

Click here to view the report.

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