Capital Protected Notes
A Capital Protected Note (CPN) aims to provide you with a capital protected investment at maturity while giving you the opportunity to participate in specific markets/segments and enjoy the benefit of exposure to a selected asset class.

Returns are achieved by linking your investment to the world’s stock, interest rate, foreign exchange or commodity markets. Any number of market opportunities is possible and, as new investment opportunities are identified, new CPNs are developed and issued. At the same time, your investment is structured to return the principal that is protected as indicated in the Indicative Term Sheet for each CPN issue.
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benefits
Capital Protection Each CPN is capital protected (typically 90% to 100%) if held to maturity. The level of capital protection given upon maturity will be set out clearly in the Indicative Term Sheet for each CPN issue.
Opportunities to invest in international financial markets There are a variety of CPN investment opportunities, linked to:
  • Market Indices such as Nasdaq or S&P 500
  • A diversified basket of stocks from different financial markets
  • A particular sector such as pharmaceuticals or technology
  • Movements in interest rates, exchange rates or commodities
Diversification for your investment portfolio Capital Protected Notes, generally being principal protected if held to maturity, are excellent for your investment portfolio diversification.
how does it work?
Each Capital Protected Note comprises of 2 elements:
Zero Coupon Note + Option
Asset Classes
Basket of Stocks Mutual Funds Market Indices
Commodities Foreign Exchange Interest Rates

A Zero Coupon Note
A Zero Coupon Note is a bond that pays no interest over its term yet repays its face value at maturity. This provides the protection against downside risk. 		An Option
An Option linked to market indices, a basket of stocks, interest rates, currency exchange rates, mutual funds, commodities, managed portfolios or any other asset classes. This enables the CPN to give a return that is tied to the performance of the markets represented by the underlying asset(s).
key components
An indicative Term Sheet describing each CPN in detail and its associated terms and conditions will be available for each new Issue.
Capital Protection This is the minimum amount of your capital that the Issuer agrees to return to you at maturity. It may not necessarily be 100% and the capital protection offered at redemption will be set out clearly for each CPN Issue.
Asset Linkage Each CPN Issue is linked to an underlying asset or combination of assets.
Participation Rate This measures how much you will participate in any movements to the underlying assets that the CPN is tracking.
Issuer and Credit Rating The Issuer(s) of each CPN and their credit rating, as quoted by Standard & Poors, Moody’s and/or Fitch.
Currency A CPN may be issued in any of the major currencies, for example, AUD, EUR, GBP, JPY, SGD, USD.
Minimum Investment The minimum initial amount required from you to purchase a new CPN Issue.
Denomination The minimum currency value of an individual CPN Issue which is also referred to as the nominal value.
Term The life span of the CPN Issue from settlement date to maturity.
Subscription Period The time period during which you can subscribe to a specific CPN Issue.
Call Feature (Callable/Non-Callable) The Issuer of a Callable CPN reserves the right to call back the CPN at certain stage in the CPN’s life and guarantees a fixed level of redemption. A Non-Callable CPN cannot be called by the Issuer prior to maturity.
key characteristics and risks
General
Before entering into any transaction, investors should ensure that they understand the potential risks and rewards of the transaction and that they independently determine that the transaction is appropriate for them given their objectives, experience, time horizon, risk appetite and other relevant circumstances. Past performance cannot be taken as a guarantee of future performance. With any investment, the value may fall as well as rise and investors may not get back the principal amount. Changes in rates of exchange may cause the value of an investment to go up or down. Learn more about product key characteristics and risk.
Issuer Credit Risk Investors are subject to issuer credit risk when purchasing the CPN. The obligation to repay the CPN and to pay the return based on the option or asset link are those of the Issuer. CPNs will have Issuers who, at the time of the Issue, have either a minimum rating of ‘A’ by S&P, or ‘A2’ by Moody’s. There is no guarantee that an Issuer will not default.
Counterparty Risk Each CPN Issue is linked to an underlying asset or combination of assets.
Reinvestment Risk Reinvestment risk arises when the issuer of a Callable CPN calls on the CPN before the maturity date. The investor bears the risk of reinvesting the proceeds from the called CPN at a lower rate of return.
Liquidity Risk A CPN is not a readily realisable investment. The investor must be prepared to hold the CPN to maturity. The availability (if any) of a secondary market for any issue will be indicated in the Term Sheet. There may be no recognised market for a CPN and therefore it may be difficult to deal in them or to obtain reliable information about their value or the risks to which they may be exposed. Thus, the valuation of the CPN prior to maturity may vary during its lifetime as it is linked to financial markets where prices fluctuate. There is no principal protection by the Issuer if the Note is sold prior to maturity and investors may incur an unwinding fee and/or partial loss of capital.
Capital Risk If the CPN is sold prior to maturity, there may be a partial loss of capital, as there may be at maturity where the product is less than 100% capital protected (as indicated clearly in the Term Sheet for the specific issue). Standard Chartered Bank has no obligation to redeem or sell the Note before maturity, and early redemption may result in the investor not receiving back the full amount invested.
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Question and answers
Are there any upfront selling fee or annual management fees for CPN? The upfront selling fee has already been included in the pricing of a CPN. There are no annual management fees.
Who is eligible to invest in a CPN? A CPN will generally only be available to “Sophisticated Investors”* as defined in Section 275 of the Securities and Futures Act. Investors will have to execute a Declaration of Status of Sophisticated Investor.

* The Term “Sophisticated Investor” in relation to individuals for the purposes of SFA is defined as:
1. A person who acquires the securities as principal and the aggregate acquisition is not less than SGD 200,000 (or its equivalent in foreign currency)
2. An individual that acquires the securities as principal and whose total net personal assets exceed SGD 2,000,000 (or its equivalent in foreign currency)
3. An individual whose income in the preceding 12 months is not less than SGD300,000 (or its equivalent in foreign currency)
Disclosures and disclaimers
This webpage is for information purposes only. It does not constitute any offer, recommendation or solicitation to any person to enter into any transaction or to adopt any trading or investment strategy, nor does it constitute any prediction of likely future movements in rates or prices. The contents of this webpage are not made with regard to the specific investment objectives, financial situation or the particular needs of any particular person. Any investments discussed may not be suitable for all investors.