Burgan Bank Kuwait to offer a capital guaranteed alternative investment product

Burgan 220 Plus Guaranteed Ltd is an opportunity for investors in Kuwait to access a successful alternative investment structure developed by Man.

The alliance between Burgan and Man means that Man will structure and manage the product and Burgan will underwrite the bond issue and market it to investors in Kuwait. Man is part of Man Group plc, a major international financial services business that is listed on the London Stock Exchange and is a constituent of the FTSE 100 index of leading shares.

The product is available in US$-denominated bonds and will target medium-term annualised growth of 18-20%1, while aiming to restrict the associated level of risk to a level comparable with the long-term average for world stocks. The offer of bonds is for a limited period, and applications must be received by 25 July 2002.

There are no up-front fees to the investor, meaning that all the capital invested will be put to work for them. Furthermore, investors in the product will benefit from increased investment exposure of US$ 160 for every US$ 100 they invest, as well as the security of a capital guarantee provided by Barclays Bank PLC2. This ensures investors the return of at least the face value of the bonds they hold at maturity, subject to relevant terms and conditions. Another characteristic of the product is a profit lock-in feature, which would allow a portion of net new trading profits to be locked in following periods of sustained profitability. The effect of this would be to enhance the level of the capital guarantee over time.

Burgan 220 Plus Guaranteed Ltd builds on the success of the Man-IP 220 product family, a range of investment products that have demonstrated an ability to produce stable returns whether global markets are falling or rising. The lack of correlation between the constituent investment strategies and traditional assets makes the product an ideal candidate for investors seeking to add diversification to their traditional equity portfolios.

Ghassan M Al-Saleh, the General Manager of Burgan Bank S.A.K., commented: "It is exciting for us to be co-operating with Man to deliver a very attractive alternative investment opportunity to investors in Kuwait. This is consistent with our commitment to innovation and quality, and it's a step we take with confidence because of Man's experience and track record as a leading global force in the alternative investment industry." He added that the $100,000 minimum investment makes the product accessible to many investors who might otherwise not be able to consider the high minimum subscriptions normally associated with products that offer diversification through sophisticated alternative investment strategies. "The value of products such as these has really been emphasised over the past two or more years of weak equity markets. We are expecting a considerable amount of interest," Al-Saleh said.

With this product, Man adds to its line of products tailor-made for investors in the Middle East region. "Burgan Man 220 Plus Guaranteed Limited offers exposure to a proven product structure", said Antoine Massad, Associate Director and Head of Middle East and Asia for Man.