BCP:  Target Coupon Bond 2 

The BCP Target Coupon Bond Series 2 is an innovative equity-based investment that offers multiple opportunities for strong returns to be generated while also providing unique defensive features to ensure high levels of capital protection. Investors are receiving exposure to equity based returns without having to take on direct equity risk.

The strategy that is focused on 50 of the largest companies with the highest ESG Scores domiciled in France, Germany, the Netherlands, and Belgium. It is a Structured Product which aims to provide a return of 5% p.a. linked to the performance of these companies with significant capital protection features.

The Key Features of the Product re as follows:

  • Potential coupon of 5.0% per annum if the Index is at or above 70% of Initial Index Level on any annual observation date
  • Memory feature means that any missed coupons are payable if the Index is at or above 70% of Initial Index Level on any subsequent annual observation date
  • The Bond has the potential to mature early/kick-out – if the Index is at or above 90% of Initial Index Level at any annual observation date from the end of year 3 onwards, the product will return the initial capital and pay the 5.0% coupon (and pay any previously missed coupons). No coupons will be paid for future years
  • The underlying index is the S&P Europe 50 ESG Select Equal Weight Index, which is an equity market index comprised of the largest 50 companies with the highest ESG Scores in France, Germany, the Netherlands and Belgium
  • Capital is fully protected unless the underlying Index is more than 50% below its initial level at maturity, whereby you will lose the same % by which the Index has fallen. This is a capital at risk product.
  • Term: Min 3 year, Max 10 years.
  • Tax treatment–gains from this product are subject to Capital Gains Tax(CGT)
  • Minimum investment €20,000
  • Available to Personal Investors, Companies, Self-Admin Pensions.
  • Closing Date 18th February 2022

 

Why might this product be suitable?

  • Attractive Tax structure: The tax treatment of this product means that gains are subject to Capital Gains Tax (CGT) which is currently 33%. Every Individual has an Annual CGT Exemption of €1,270 (€2,540 for a couple). Therefor if a couple were to Invest €50,000 in this product an earn a return of 5% pa , ie €2,500. This is within their annual CGT exemption meaning the entire amount would be Tax free. Furthermore, if you have an existing capital losses, these can be offset against any gains made on this product.

 

  • Hedge against market correction: This product offers a “hedge” for slightly negative or Neutral Investors who feel that markets may be due a correction from their current levels. This product will pay a coupon of 5% pa as long as the Index is above 70% of its opening levels. In other words, the Index can fall by up to 30% and you still receive your annual Coupon.

 

  • Memory feature –This product has an Innovative memory feature which is designed to recoup any missed Annual coupons. For example, if the Index level is below 70% at the end of years 1 and 2 and is at 75% of Initial Index Level at the end of year 3, then15% is paid out, this equates to the coupons for years 1,2 & 3.

 

  • Opportunity for Early Maturity  – The product can mature early/Kick-out if the Index level is equal to or above 90% of its Initial level at any annual observation date from year 3 onwards.

 

Regulatory Warning

WARNING: If you invest in this product you may lose some or all of the money you invest. WARNING: If you cash in your investment before the Final Maturity Date you may lose some or all of the money you invest. WARNING: The value of your investment can go down as well as up. WARNING: Past performance and simulated past performance is not a reliable guide to future performance. WARNING: Certain investments may carry a higher degree of risk than others and may therefore be unsuitable for some investors. WARNING: If Barclays Bank Ireland plc were to default, you will lose some or all of your investment and potential return. WARNING: Current Irish taxation legislation does not allow for a clear tax categorisation of this product. There is a risk an alternative taxation basis may apply.

 

 

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