LEGAL & GENERAL LAUNCHES TWENTY-FIRST GROWTH DEPOSIT BOND.
20 June 2013
6 Year Growth Deposit Bond 21, opens for investment for eight weeks from Monday 24 June, closing on Friday 9 August 2013.
The minimum return on the Bond, which is return of capital, remains unchanged from the previous issue. The ‘participation rate’ offers savers a potential return of 125% of the growth in the FTSE 100 Index up to a maximum value of 35% gross of the original investment.
If investors take out some or all of their money before the end of the fixed term they may get back less than they invest.
James Harrington, Head of Structured Solutions said; “We are pleased to be launching another new product in the 6 Year Growth Deposit Bond series. It continues to prove a popular choice with advisers and their clients and is now our longest running structured deposit, having been on sale since this series launched in May 2010.
Perhaps given the recent Bull Run on equities, Growth Deposit Bond will appeal to cautious investors who would like the opportunity to benefit from further FTSE 100 Index growth with the reassurance of the return of their original investment at the end of the six year term, even if the FTSE 100 Index falls.
With the new Governor of the Bank of England, Mark Carney* hinting that interest rates are likely to stay low for some time, it’s no surprise that investors may be seeking index linked returns with the added assurance that their capital is protected.”
*Note - Mark Carney speaking at the World Economic Forum in Davos in January 2013.
Whilst 6 Year Growth Deposit Bond 21 is designed to return the customer's original capital at the end of the six year term, this may not happen if the deposit taker, Cater Allen Limited was unable to repay us what they owe. In this scenario, the customer may lose some or all of their capital.
However, Cater Allen Limited is a member of the Financial Services Compensation Scheme (FSCS), which covers the first £85,000 each customer holds with a particular bank or building society.
The minimum investment is £500 and the Bond is available as a deposit plan (for individuals, pension trustees, charities and corporate applications).
Investors can also use their cash ISA allowance, where available, and invest up to £5,760 for the 2013/2014 tax year.
There is no maximum for cash ISA transfers, or if investing in a deposit plan.
The last date for ISA transfers is 26 July 2013 to allow time for the completion of the transfer before the offer close date. The closing date for all other applications is 9 August 2013.
Commission for Financial Advisers is 3% of the sum invested.
Full details of this product are available on Legal & General’s dedicated adviser website www.landgstructuredproducts.com.
Advisers can also contact Solutions First on 0370 050 0614 (Lines are open from 9am to 5pm Monday to Friday. We may record and monitor calls. Call charges will vary).
Or email firstname.lastname@example.org
Notes to editors
The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions.
1. The contract start date is Wednesday 28 August 2013 and the end of the fixed term is Wednesday 28 August 2019.
2. This plan is not suitable for customers who may need to access their money before the end of the six year term or who may be seeking a definite return.
3. The growth of the FTSE 100 Index will be measured using the initial level of the Index at close of business on 28 August 2013 and the average level of the Index in the last 12 months of the investment, commencing 28 August 2018 to 28 August 2019.
4. The average level is based on the closing level of the Index on the 28th of each month during the averaging period (13 observations).
5. The gross rate is the rate of interest that would be payable before the deduction of income tax. This is the rate we pay on a cash ISA.
6. The 6 Year Growth Deposit Bond 21 is designed to return the original investment at the end of the fixed term. If investors take out some or all of their money before the end of the fixed term, they may get back less than they invest.
7. The Deposit taker is Cater Allen Limited.
8. The return of the original investment and any applicable return is dependent on Cater Allen paying this money to us. This might not happen if Cater Allen default or become insolvent and unable to repay us this money. If they don't repay us, the investor could lose some or all of their original investment. Cater Allen is a member of the Financial Services Compensation Scheme, which covers the first £85,000 each customer holds with each bank or building society.
9. Taxation - as this is a deposit investment any growth received is treated as interest. The cash ISA (and an ISA transfer) is a tax free investment. Any growth received through the deposit account will be paid net of UK income tax at the basic rate (currently 20%). Non tax payers can reclaim this tax. Higher and additional rate tax payers will have further tax to pay. SIPP, SSAS, charity or company applicants can be paid without the deduction of income tax but only where sufficient documentary evidence is provided.
10. This investment does not invest directly into the companies that make up the FTSE 100 Index so no dividend income is received.
For more information please contact:
About Legal & General
Legal & General (Portfolio Management Services) Limited.
One Coleman Street
London EC2R 5AA.
Registered in England 2457525.