Fortis Bank has returned to Hong Kong’s structured retail notes market with its first product since November 2004.
Equity Linked Notes Series CKH 0101 and Series CKH 0102, are one-year growth and income notes linked to a basket of four shares to be issued by the Belgian bank and distributed locally by Cheung Kong Bond Finance Limited.
Fortis has focused primarily on private placements in Hong Kong, but told SRP the retail market is also now ready. “The Hong Kong market is strong and the retail segment is again ready to invest in products that provide yield enhancement in a bullish and stable equity environment,” said local head of equity structuring Michael Plant.
He went on to emphasise that the series’ features were carefully selected. “The product structure allows investors to benefit not only from a fixed coupon after three months, but an unlimited upside at maturity. In addition, the unique ‘one touch’ feature provides an enhanced likelihood of achieving conditional coupons – an attractive alternative to the traditional daily range accrual product. Our very low knock-in and put strike levels provide investors greater protective cushions than most comparable products in the market.”
The product is a rollover option for the previous Cheung Kong/Fortis launch, Equity-Linked Notes Series CKH 0302, which yielded its maximum possible return. The timing and nature of Fortis Bank’s next Hong Kong launch depends on the market, but will most likely be later this year or early next year when it intends to launch ELIs as well as notes.
