Goldman prices $374 million in MSCI Daily Total Return Net Emerging Markets Index notes

By Sheri Kasprzak

New York, Dec. 8 - Goldman Sachs Group, Inc. rounded out the week in structured products news with word that it sold $374.513 million in 0% notes linked to the MSCI Daily Total Return Net Emerging Markets Index. The offering is not the first emerging-markets related offering announced this week.

"I happen to think emerging markets are getting more popular," said one equity structurer when asked if recent emerging markets-related notes were a fluke or if there EM offerings are gaining in popularity.

"Emerging markets are incredibly strong right now so, of course, you're going to have investors who want to get a piece of the action."

The areas that seem to be most popular, the market source said, are Latin America and Asia.

"That index does include Middle Eastern, Eastern European and other countries that haven't traditionally been that popular, but I think most of what we're going to be seeing is coming out of Latin America or Asia," he said.

The six-month notes pay par plus any gain on the index at maturity. The investors are fully exposed to any losses on the index.

The index measures the market performance of 25 emerging market country indexes including Argentina, Brazil, Chile, China, Colombia, the Czech Republic, Egypt, Hungary, India, Indonesia, Israel, Jordan, Korea, Malaysia, Mexico, Morocco, Pakistan, Peru, the Philippines, Poland, Russia, South Africa, Taiwan, Thailand and Turkey.

HSBC, Rabo, JPMorgan had EM deals

Earlier this week, HSBC Bank USA Inc. and JPMorgan Chase & Co. announced plans to price emerging markets-related offerings.

HSBC's Far East Opportunity point-to-point certificates of deposit were linked to the MSCI Taiwan index. The CDs were also linked to the MSCI Singapore Free, Hang Seng China Enterprises and Nikkei 225 indexes.

JPMorgan priced $3.85 million in 0% buffered return enhanced notes linked to a basket of emerging markets indexes, including the Korea Stock Price 200, MSCI Taiwan, Amex Hong Kong 30, FTSE/Xinhua China 25 and MSCI Singapore indexes.

Upcoming EM notes

Looking ahead, JPMorgan said it plans to price 0% senior unsecured principal-protected auto-callable knock-out notes linked to iShares MSCI Emerging Markets Index Fund. The two-year notes will be priced through J.P Morgan Securities.

On the downside, Rabo Financial Products BV plans to price 9.1% reverse convertible notes linked to the iShares MSCI Emerging Markets Index Fund.

The one-year notes are set to price Dec. 21 through LaSalle Financial Services, Inc.

Morgan Stanley's Exxon-linked notes

Elsewhere in structured products news, Morgan Stanley negotiated the terms of a $35,006,625 offering of 20% reverse exchangeable notes linked to Exxon Mobil Corp.

If Exxon's stock exceeds the exchange price of $91.0172, 120.25% of the initial amount, the payout will be par in cash.

Payout at maturity, otherwise, will be 0.831601 shares of Exxon Mobil for every $75.69 in principal held.

In August of this year, Barclays Bank plc priced $750,000 in 8.53% reverse convertibles linked to Exxon Mobil's stock.

In December 2005, Morgan Stanley priced $31,502,555 in 20% exchangeables linked to the stock.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.