Shinhan Investment Corp. noted that it will raise a total of 15 billion won through the public offering of the monthly payment stock-linked derivative bond (ELB) No. 3585 by 1 p.m. on the 30th of this month. The minimum subscription amount is 1 million won.
This public offering ELB is a principal repayment type product based on common stock of Samsung Electronics, with a maturity of 3 years. If the monthly revenue evaluation price of Samsung Electronics is 90% or more of the initial reference price on the revenue evaluation date, it pays a pre-tax revenue of 0.4175% (annual basis 5.01%). If it is less than 90% of the initial reference price on the monthly revenue evaluation date, no revenue will be paid.
In addition, it imposes early redemption conditions every 3 months. If the early redemption evaluation price of the underlying asset is 100% or more of the initial reference price on the automatic early redemption evaluation date, the principal will be paid and redeemed early.
Shinhan Investment Corp. stated that the principal will also be paid if the maturity evaluation price of the underlying asset is less than 100% on the maturity evaluation date. The previous product had an automatic early redemption opportunity every 6 months, but this time, the company reduced the automatic early redemption evaluation cycle to 3 months, providing more opportunities for redemption.
The ELB is a principal repayment type product; however, it is not subject to deposit protection. Shinhan Investment Corp. said, "Since the return on the investment product is determined by the price of the underlying asset, if the underlying asset does not meet the price condition, the agreed revenue may not be received, or there may be a loss of principal upon early redemption at the request of the investor."
Moreover, it may not be redeemed based on the credit of the issuer, so investors must check the credit rating of the issuer before joining the product. According to Korea Credit Ratings, Shinhan Investment Corp.'s credit rating is 'AA' as of May 23.