Legal & General launches fourth plan in its guaranteed capital bond series

Legal & General is launching the fourth ‘tranche’ in its series of guaranteed equity bonds.

Guaranteed Income and Capital Bond 4 offers investors a choice of how they receive the income, either as a set income payment at the end of the five year term or a set income paid annually.

Guaranteed Income and Capital Bond 4 will be available from Tuesday 2 January 2007 to Wednesday 28 February 2007.

Legal & General’s Guaranteed Income and Capital Bond 4

This is a fixed term, five year, guaranteed deposit investment offering a fixed income plus growth potential with a link to the FTSE 100 Index at the end of the five year term. Income is paid on half of the original capital amount. The other half provides 50 per cent of any capital growth in the FTSE 100 Index at the end of the term (5 March 2012).

Investors can choose whether they take the income as five annual payments (5.5% gross/ AER) or as a single payment at the end of five years (30% gross, 5.39%/ AER). Plus, investor’s original capital is guaranteed and will be returned in full, even if the FTSE 100 Index falls, provided the investment is held for the full five years.

Legal & General’s Sales Director (Protected Capital Products), Jamie Vale said: “Our overall aim is to achieve an inflation beating return by offering investors exposure to the FTSE 100 Index growth potential with minimal risk to their capital. We think the option to have a guaranteed return paid at the end of five years could prove extremely attractive to investors looking to maximise returns and have the potential, when wrapped in an ISA, to have it paid free of taxes.”

Investors with Tessa-only ISA and cash ISA holdings have the opportunity to transfer their investment to Guaranteed Income and Capital Bond 4.

The minimum investment is £500. The maximum investment for mini cash ISAs is £3,000. There is no limit for Tessa-only ISA/cash ISA transfers and deposit investment.

The funds invested are placed with the deposit taker Cater Allen Limited (a member of the Abbey Group of companies) at the start of the investment. This investment does not take account of dividends that would be available through holding shares in the FTSE 100 Index directly.