Baiduri introduces structured deposit financial planning
By Zasika Musdi

Bandar Seri Begawan - Baiduri Bank introduced to investors the Structured Deposit - Series 1, a combination of a savings account and a structured investment.

The capital is guaranteed by the issuing bank, said Mr Peng Eng Soon, Head of Wealth Management.

"They are different from savings account in that the structured deposit returns depend usually on the performance of an underlying financial instrument," he said. A lot of investment interest has been received since its launch on April 1, according to Mr Peng.

"However, we have a quota, and upon reaching this quota, we will close the opportunity for investment even before the closing dates. So I would recommend to those interested to contact us as soon as possible," he said.

He claims that Baiduri Bank is the first bank in Brunei to offer an investment opportunity such as this, and believes that commodities will go up through the years -which is why the bank is willing to give investors as much as eight per cent. " Companies are also encouraged to subscribe, he said, but they should at least have an account at Baiduri Bank, to make it easier for the balance at the end of the year to be credited to their account.

Subscription period runs from April 1 to April 30, 2008; currency are in Brunei dollars, with a fiver tenure; 100 per cent of capital is protected upon maturity; minimum amount of B$1,00 (in multiples of 1,00) can be invested; targeted return of eight per cent annually is credited to investors' account (they should at least have a savings account .at Baiduri Bank); and there are no sales charges.

The target market are investors seeking 100% capital protected investment; investors seeking better returns than normal savings and term deposit; those with extra money set aside for medium to long-term investment; those who are planning towards a pre-retirement fund (five years to retirement); beginner investors; conservative investors; those who are seeking exposure in the commodities market with 100% capital protected; and those who want a change of risk after equities market correction.

The benefits are diversification - an opportunity to invest in commodities; early stage of bullish - an opportunity of investment in the beginning of commodities rising market; full principal protection of maturity; flexible liquidity and valuation on a daily basis - premature upliftment allowed with penalty charges as low as one per cent of the market valuation price (MVP).

For example, if an investor invests with a principal of B$10,000, with 110% MVP, and a penalty charge of 1%, calculation of B$10,000 x (1% of 110%=108.9%)=B$10,890; customers still gain B$890.

There will be a high return of eight per cent yearly with high probability; catch-up mechanism where investors get a chance to catch up with the coupon missed in the past year provided their final year performed well and hits the eight per cent; and no sales charges. -- Courtesy of Borneo Bulletin

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