Press releases

Three new Early Bonus Plans from Legal & General

James Harrington - Head of Commercial Implementation, Platforms & Distribution
James Harrington
Head of Structured Solutions

04 July 2013

James Harrington - Head of Commercial Implementation, Platforms & Distribution
James Harrington
Head of Structured Solutions

Legal & General's new products, Legal & General Early Bonus Plan 14, 15 and 16 opened for investment from Monday 1 July and close eight weeks later on Friday 23 August 2013.

Offering three plans together gives customers and their advisers greater choice to select an investment plan that fits their view of how the investment market is likely to perform in future and that matches their attitude to risk.

Three products in one proposition:

All the products in the range can mature early and pay a bonus on a set anniversary depending on the performance of the FTSE 100 Index.

Customers can choose whether they wish the Plan to measure the performance of the FTSE 100 Index each year, after every two years or every three years in respect of the potential early maturity opportunities. 

If the early bonus payment feature activates, investors receive their capital plus a bonus payment and the Plan will close prior to the end of the term. If early payment is not activated, the Plan continues to the next ‘applicable anniversary’ or to the final maturity date.

In addition, Early Bonus Plans 15 and 16 offer investors a ‘defensive’ bonus option, which can be triggered even when the FTSE 100 Index falls (by up to 10%).

Legal & General Early Bonus Plans 14, 15 and 16 are capital at risk products. 

Capital is not protected with these Plans. Investors can lose more than 50% of their original investment if the FTSE 100 Index has fallen by more than 50% from its starting level at the end of the six year term.

The original capital invested will be reduced by 1% for each 1% that the final level of the FTSE 100 Index is below the plan starting level. So, if the FTSE 100 Index is 60% less than it’s starting level, investors will receive 60% less than they invest.

James Harrington, Head of Structured Solutions said; “With many plans currently reaching maturity, Autocall, or kickout plans continue to be extremely popular amongst clients and their advisers. 

We have chosen to offer some different potential bonus levels on these new plans either for clients to choose just one option, or, as is the case with some of the feedback we have had, to select multiple options in order to create a portfolio of Autocall type structures to hold amongst their other investments.

We are retaining the defensive option on two of the Early Bonus Plans as once again feedback from advisers is that they are looking to give their clients investment choice.

Overall, we believe this new approach will widen the appeal of capital at risk investment and attract new clients. For advisers, this presents an opportunity to tailor the investment approach to more closely match a client’s overall investment objectives and risk appetite.

Whatever option is chosen however, it is important to make sure investors fully understand and accept that there is some risk to their capital."

Minimum investment:
The minimum investment is £3,000. Investors can invest up to £11,520 in a stocks and shares ISA for the 2013/2014 tax year.

There is no maximum for ISA transfers. The last date for ISA transfers is 9 August 2013 to allow time for the completion of the transfer before the offer close date. The closing date for all other applications is 23 August 2013.

Adviser Charging:

All Early bonus plans offer Facilitated Adviser Charging (FAC).

Full details of FAC arrangements and product key features are available on the Legal & General
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 structured.team@landg.com

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. For all three Early Bonus Plans the contract start date is 11 September 2013 and the end of the fixed term is 11 September 2019.

2. These Plans are 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, and are not prepared to accept the risk that they may lose some or all of their investment.

3. The growth of the FTSE 100 Index will be measured using the initial level of the Index at the close of business on the start date and the final level of the Index on each applicable anniversary. Details of when the FTSE 100 Index levels are measured can be found on www.landgstructuredproducts.com

4. The Plans will close early paying back the original investment plus a set bonus if the early bonus is triggered on any of the applicable anniversary dates. At the end of six years, if the early bonus payment has not been triggered, the return will be as follows:

Early Bonus Plan 14 and option A on EBP 15 and EBP 16 - If the FTSE 100 Index has fallen by 50% or less from its starting level at the end of the six years, the investor will receive back their original investment, but no bonus.

Option B (applies only to EBP 15 and EBP 16) - If the FTSE 100 Index has fallen by more than 10% but no more than 50% from its starting level at the end of the six years, the investor will receive back their original investment, but no bonus.

All Early Bonus Plans - If the FTSE 100 Index has fallen by more than 50%, the client's original investment will be reduced by 1% for each 1% that the final level of the FTSE 100 Index is below its starting level.

5. The investment should be held until maturity but can be encashed, or if held as an ISA, transferred to another ISA provider at any time. If this happens, the investor may get back less than they originally invest.

6. The securities provider is Abbey National Treasury Services Plc (Guarantor is Santander UK Plc). In the event that these entities become insolvent and therefore unable to meet their commitments, the investor could lose some or all of their original investment and any applicable bonus.

7. This investment does not invest directly into the companies that make up the FTSE 100 Index and so no dividend income is received.

8. Early bonus payment summary table: to view the early payment summary for all three plans please click on the link at the top right of this page.

9. Early Bonus Plan 14, 15 and 16 are provided by Legal & General (Portfolio Management Services) Limited.


For more information please contact:

Mike Connolly
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