Bonus enhanced note on Philippines blue chips stocks

Product Rationale

Philippines has been one of the fastest growing economy among emerging countries in the recent years, with a GDP growth of 6% for the last six years. Philippines momentum should continue to benefit from:

  • Young population: More than 30% of Philippines’s population is under the age of 15, workforce will continue to expand and support consumption

  • Strong government stimulus: Duterte’s government is rolling out a USD 180 billion programme to build roads, railways, and increase infrastructure spending overall; the government is also pushing for tax reforms to lower personal income taxes and consumption goods taxes while raising taxes on other industrial products such as petroleum products or automobiles

  • Positive investor sentiment: Amount of foreign investments into the country is hitting high records in 2017

  • The property, banking and consumer goods sectors are more likely to benefit from the growing economy
Product Description
  • Issuer: Commerzbank AG
  • Maturity: 6 months
  • Currency: qUSD
  • Bonus coupon: 20% flat
  • Strike price: 100%
  • At maturity: 
    • If the worst performing underlying closes above the strike price (observation at maturity), then the investor receives:
      100% + Max(Bonus Coupon, Wof(f) / Wof(i) – 100%)
    • Else, the investor receives:
      Wof(f) / Wof(i)
      Wof(f) is the final level of the worst performing underlying
      Wof(i) is the initial level of the worst performing underlying
  • Underlyings:

Underlying name

Bloomberg ticker

SM Prime Holdings Inc.

SMPH PM Equity

Metropolitan Bank & Trust

MBT PM Equity

Universal Robina Corp.

URC PM Equity

Key Benefits
  • Investor receives a high bonus coupon of 20% flat

  • Key Risks
    • In a strongly trending equity market, the investor potentially receives a lower return from the note than compared to investing in the underlying stocks
    • The investor is subject to the issuer risk of Commerzbank
    • Please also refer to Additional Risk Disclosures below

Additional Risk Disclosures
Before investing in this product, investors should carefully consider its appropriateness and suitability, and the following additional risks: 1. Issuer Risk: Any failure by the issuer to perform its contractual obligations, when due, may result in the loss of all or part of the invested capital. 2. Counterparty Risk: Any failure by Commerzbank AG to perform its contractual obligations, when due, may result in the loss of all or part of the invested capital. 3. Market Risk: Various market factors may affect the value of the investment or the underlying assets, including but not limited to the impact of volatility, interest rates, dividends (if any), foreign exchange. 4. Liquidity/Secondary Market Risk: Under normal market conditions Commerzbank will endeavour to provide a secondary market price. However, Commerzbank has no obligation to make a secondary market in the instruments concerned. Accordingly, under some circumstances, the secondary market for the investment may be limited and subject to wide bid/offer spreads. 5. Reinvestment Risk: The risk that the investment redeems prior to maturity at a time when reinvestment opportunities are not favourable for the investor. 6. Redemption Risk: The risk that the investor may receive substantially less than the amount invested, if they liquidate the investment prior to maturity. 7. Tax Risk: There may be tax implications based on where the investor resides. Please consult a tax professional before investing. 8. Legal Risk: There may be legal restrictions depending on where the investor is domiciled. It is advised to seek legal guidance prior to investing. When specified, the terms ‘guaranteed’ and ‘protected’ are subject to the creditworthiness and solvency of Commerzbank and although financially strong there is the possibility that returns may not be met in the unlikely event of a Commerzbank failure. For additional information on the product features and key risks, please contact your sales advisor or refer to the contacts page.