- Reverse Convertible Notes have been newly listed for the first time on the Warsaw Stock Exchange today.
- Two series of new notes with the underlying stock of PKO BP and KGHM have been introduced into trading.
A new type of financial instruments on the Polish market, Reverse Convertible Notes (RCN) issued by Raiffeisen Centrobank AG, have been newly listed on the Warsaw Stock Exchange on 26 July 2013.
The underlying of the new notes is the stock of two Polish companies, PKO BP and KGHM. The novelty which is bound to attract the attention of investors is a high, fixed interest coupon paid at maturity, calculated on the basis of the par value of the notes irrespective of the price of the underlying stock. The coupon is 16.5% (10.73% p.a.) for the notes on the stock of KGHM and 12.5% (8.18% p.a.) on the stock of PKO BP. The maturity date of the new notes is 31 December 2014.
The price of the underlying stock determines the form of the payout from the instrument at maturity. If the underlying stock closes above the exercise price (i.e., the price of the underlying stock on 26 June 2013 for both series of notes), the investor will be paid 100% of the par value of the notes plus the interest coupon. If the underlying stock closes at or below the exercise price, the investor will receive stock of the company in a quantity calculated according to a conversion rate defined on the date of the first valuation plus interest.
The addition of new financial instruments to the WSE’s product offer comes in continuation of the strategy of the Warsaw Stock Exchange aiming to provide investors with a broad range of products, both traditional and innovative with a more complex structure, necessary to diversify risks also at the time of less performing markets.
For more information, visit the website: http://www.gpw.pl/certyfikaty_odwrotnie_zamienne