Vontobel Limited Issues CBBCs Linked to Stocks in Hong Kong

Strategic Insights -

Vontobel Limited has announced the issue of five series of Certificates of Beneficial Interests (CBBCs) linked to the performance of shares in major Hong Kong companies. The CBBCs are designed for investors seeking to gain exposure to the stock market through a cash-settled product. The five series are linked to Tencent Holdings Limited, Meituan Dianping, Xiaomi Corporation, Alibaba Group Holding Ltd., and Geely Automobile Holdings Limited.

Each series has a unique set of features, including issue size, strike price, funding cost, and entitlement ratio. The CBBCs are European-style cash-settled, meaning investors will receive a cash payment at expiry based on the performance of the underlying stock.

The issue sizes for the five series range from 40 million to 60 million CBBCs, with issue prices set at HK$0.250 for all series. The funding costs vary between HK$0.10400 and HK$0.19000 per CBBC, depending on the series. The strike prices range from HK$15.700 to HK$519.400, reflecting the significant variation in underlying stock prices.

Investors can purchase the CBBCs through a depository settlement service, with a minimum board lot size of 1,000 CBBCs. The CBBCs will be listed on the Stock Exchange of Hong Kong and will commence trading on 9 September 2020.

Key Takeaways:

  • Five series of CBBCs have been issued by Vontobel Limited, linked to Tencent Holdings Limited, Meituan Dianping, Xiaomi Corporation, Alibaba Group Holding Ltd., and Geely Automobile Holdings Limited.
  • Each series has a unique set of features, including issue size, strike price, funding cost, and entitlement ratio.
  • The issue sizes for the five series range from 40 million to 60 million CBBCs, with issue prices set at HK$0.250 for all series.
  • The funding costs vary between HK$0.10400 and HK$0.19000 per CBBC, depending on the series.
  • The strike prices range from HK$15.700 to HK$519.400, reflecting the significant variation in underlying stock prices.
  • The CBBCs will be listed on the Stock Exchange of Hong Kong and will commence trading on 9 September 2020.

Statistics:

  • Issue size (CBBCs): 40,000,000 (Series 1), 60,000,000 (Series 2), 40,000,000 (Series 3), 40,000,000 (Series 4), 40,000,000 (Series 5)
  • Issue price (HK$): 0.250
  • Funding cost (HK$): 0.10400 (Series 1), 0.10780 (Series 2), 0.19000 (Series 3), 0.14180 (Series 4), 0.16800 (Series 5)
  • Strike price (HK$): 519.400 (Series 1), 248.380 (Series 2), 23.300 (Series 3), 273.380 (Series 4), 15.700 (Series 5)
  • Board lot size (CBBCs): 1,000 (Series 1, 4, 5), 10,000 (Series 2), 2,000 (Series 3)

Sources:

  • Vontobel Limited, "Announcement: Issue of CBBCs" (7 September 2020)
  • Stock Exchange of Hong Kong, "Liquidity Provider Broker ID: 9741, 9741, 9693, 9693, 9693" (7 September 2020)
  • Hong Kong Exchanges and Clearing Limited, "CBBCs Linked to Shares in Major Hong Kong Companies" (7 September 2020)