Abbey issues two-year special growth bond linked to FTSE 100

Abbey Financial Markets has launched a second special release structured deposit linked to the FTSE100 to complement its constantly available capital guaranteed bonds linked to the FTSE 100, NIKKEI 225 and residential and commercial property markets.

The special release bond offers a capital guaranteed structured deposit linked to the FTSE100 over a two-year period. The product pays 80 per cent of the upside in the FTSE100, averaged over the last six months. Initial commission is 1.5 per cent. Like most of Abbey's other structured deposits, this bond can be invested in directly, or through a SIPP/SSAS pension scheme or most offshore bonds.

The bespoking service is available to intermediaries interested in developing niche products to satisfy specific investor demand. Any products designed on a bespoke basis for specific IFAs can be offered as special release bonds to the wider intermediary market, provided the IFA firm has not requested an exclusive product.

Gary Dale, Head of Intermediary Business Development at Abbey Financial Markets, said: "Not all clients with shorter investment horizons want to leave their money in cash. Short-term structured deposits linked to equity markets with capital guarantees are an area of the market that we expect to grow over the coming months.

“Feedback from intermediaries has highlighted the shortage of simple short-term structured products as well as the more esoteric asset classes that are now being developed. This two-year trade offers clients some real exposure to the UK Equity market on a shorter timescale without the associated risks to capital.

“The ability for an IFA to develop tailored products designed to meet investors’ demand is a strong proposition model and we expect the number of these trades to increase dramatically throughout 2007.”