Structured Products and Structured Notes

Combine growth potential with protection

Structured products such as Structured Notes can offer you the best of both worlds, combining growth potential, with the ability to protect your initial investment provided they are held till maturity and subject to credit risk of the issuer.

Structured Notes clearly explained

Structured Notes clearly explained

How does it work?

A Structured Note combines two elements: A bond (that protects your principal) makes up most of the investment (typically 80%), and the rest of your money is put into a derivative.

Because the investment bond element in Structured Notes can be designed to give a return that equals your initial investment (as long as you keep the product until maturity), your principal will be protected. And the derivative element offers you the potential to achieve higher returns when compared with a standard deposit.

Structured Note terms are generally between 18 months and six years and it is important that you can afford to tie up your money for that period, because your principal is only protected when Structured Notes are held for their full term.

Citi International Personal Bank regularly launches new structured products that take advantage of current market conditions and Citi's expert investment advice. This ensures our Structured Notes are always competitive and provide you with the opportunity to benefit in changing markets.

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Structured Note examples

For example, you could choose a two year 100% principal protected Structured Note linked to gold, available in US Dollars / Euros or Sterlings. At maturity, the investor receives 100% of the principal investment, and has the potential to get higher returns subject to the favourable movement in the price of gold over the two-year term.

Another option could be a three year Structured Note from Citigroup Funding Inc in Euros. In the first two year the fixed coupon paid 6% per annum in each respective year. At maturity (in the third year), the final amount earned on the Structured Notes depends on the performance of the top 20 stocks of DJ Eurostoxx Index; (Where the contingent coupon could earn up to 30% if all 20 stocks increased in price. The maturity levels in 2012 will be compared with the initial levels in 2009).

Tailored investment

In addition to the wide range of Structured Notes we offer, we can put together an individual structured product that matches your requirements. So if you want the investment portion to target a particular sector or you would prefer not to 100% protect your principal for the potential of higher returns, this can also be arranged. We regularly provide this service for clients based on their needs combined with our experts' opinions of future growth sectors.

You can take out a Structured Note in Euro, US dollars, Sterling or other currencies, minimum investment terms apply. Please speak to your Relationship Manager for full details.

Who do they suit?

Structured Notes are innovative and flexible investment products that suit a wide range of investors.

  • Investors who want to diversify their portfolio with lower risk products that protect their principal and still offer the opportunity to realise higher rewards than a standard Time Deposit.
  • Those who want the chance to invest in high-risk securities they wouldn't consider direct investment into, such as equities or commodities.
  • Investors who can lock away their money for the term of the particular Structured Note.
    Those who can meet the minimum investment criteria to invest in a Structured Note. Please speak directly to your Relationship Manager for full details.
  • Those who accept only receiving back the initial amount invested, if the derivative element of the Structured Note does not perform.

Citibank partners

Citi International Personal Bank gives you access to the leading providers of Structured Notes to give you more choice and allow you to benefit from the experience of the world's top financial companies. Structured Notes are available from the below issuers:

  • Credit Suisse
  • BNP Paribas
  • Citibank International PLC and Citigroup Funding Inc.
  • Deutsche Bank
  • JP Morgan
  • UBS

As a Citi International Personal Bank client you have access to our Citi wealth management service, where your dedicated Relationship Manager will work with you to build a long-term strategy and investment portfolio that is matched to your specific requirements. Find out more about wealth management.

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Structured Notes are not suitable for everyone. Investors assume full credit risk of the Issuer and/or the Guarantor. This means that should the Issuer and/or the Guarantor become insolvent or fail in any other way you may not receive back any of your investment monies, not even the initial investment amount as the principal protection will not apply in this situation.

Payment of principal, interest or any other amounts due under or pursuant to notes are not protected by the UK Financial Services Compensation Scheme Limited (the "Scheme") in the event of the issuer being unable to meet any of their obligations under or pursuant to the notes. Investors assume the full credit risk of the issuer defaulting on their obligations. Notes are not designed to be liquid and investors should intend to hold their Notes until maturity. Notes may have no established trading market or a trading market that is not very liquid. Therefore investors should be aware that they may not be able to sell their Notes easily or at prices that would provide them with a comparable yield to similar investments that have a developed secondary market.

Structured Notes are complex investment products and are subject to investment risks which include:

May entail the loss of all or part of the invested capital. Products are (i) not insured by any government agency; (ii) not a deposit or other obligation of, or guaranteed by, the depository institution; and (iii) subject to investment risks, including possible loss of the principal amount invested.

Where these offer principal protection this is provided they are held until maturity and is subject to issuer risk, this means you accept the risk that if the issuer fails and are unable to pay the investment back, you could lose your entire investment.