BNP Paribas launches Hong Kong retail credit-linked note

BNP Paribas is today launching its first retail structured note for the Hong Kong market. The Paris-based bank will offer capital guarantees on the performance of the 'Elite Series 1' credit-linked notes, which are issued by BNP Paribas Retail Note Issuance.

The payout will be linked to a reference basket of six financial institutions and corporates, with a fixed interest payment of up to 5% a year over five-and-a-half years. Payments will be made in two instalments every year, subject to conditions. The six reference names are: American Express, American International Group, Hewlett Packard, Hutchison Whampoa, JP Morgan Chase and Walt Disney.

The notes come in two different tranches: in US dollars, with a 5% interest rate; and Hong Kong dollars with a 4.55% interest rate. They will be offered until October 27 at the Hong Kong branches of BNP Paribas Private Bank and other local bank distributors. The minimum investment amount is $5,000 or HK$40,000 ($5,150).

“We strongly believe that the distribution of retail-based notes through local bank distributors is a new avenue to develop new clients in the various domestic capital markets in the region,” said Eric Nicolas, BNP Paribas' head of fixed income Asia Pacific (ex-Japan).