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B&W brings out five-year GEB Isa

Bristol & West has brought out the latest issue of its five-year guaranteed equity bond cash Isa.

This Isa is linked to the performance of three stockmarket indices, the FTSE 100, Eurostoxx 50 and Nikkei 225. This feature is designed to allow geographical diversification instead of relying on a single country. A full return of the original capital is guaranteed however the indices perform during the five year period. However, growth potential is capped at 70 per cent of any rise in these indices.

To calculate the returns, the closing values of each index is recorded at the start date, June 14, 2002, and these are compared with the average closing levels between June 14, 2006 and June 14, 2007. An average is produced from these figures and investors will get 70 per cent of any growth. If there is no growth, investors will get only their original capital.

The Isa may appeal to cautious investors, those who are planning to move from building society accounts to stockmarket investments and those with maturing Tessa money to reinvest.

However, the fact that it includes exposure to the Japanese stockmarket but ignores the US may undermine its claim for geographical diversity and the capital guarantee will only apply if investors adhere to the full five-year term. This means investors are locked in and if the anticipated recovery accelerates over the next five years, investors would not fully benefit because of the cap on growth.


IFS switches on electronic exams to beat deadline

The Institute of Financial Services is warning that time is running out for mortgage advisers who have failed to obtain the Mortgage Code Compliance Board minimum standard qualification.It says with only eight months to go before the regulatory cut-off date of December 31, up to 20,000 advisers have still failed to take the Certificate in […]

Inside edge: Robert Clifford

I have a problem with rate tarts because they threaten the mortgage pricing model. As unpopular as the fact may be, new product pricing has for decades fundamentally relied upon consumer inertia. These tarts might just screw things up for us.Imagine, then, how insulted I felt when the general manager of a well-known building society […]

Friends Provident cuts the cost of life cover

Friends Provident is making reductions in its term assurance rates of up to 15 per cent on products it sells exclusively through IFAs. New rates will apply to level term, decreasing term assurance and life cover in its Select Protection Plan. This means, for example, a female aged 30 non-smoker with a 25 year £150,000 […]

Mushens to leave M&G

M&G director of sales and marketing opportunities Jeffrey Mushens has left the company after 15 years to explore new horizons. Mushens, who intends to take the next few months off, will not be replaced by M&G. As a result UK retail chief executive Gary Shaughnessy assumes responsibility for governmental and regulatory issues, while managing director […]

Guarantees in the retirement income market

Lorna Blyth, Royal London  Do guarantees benefit customers and, if so, when? To answer this conundrum we commissioned Millimans, a global actuarial consulting firm, to conduct an independent review of the UK retirement income market and whether guarantees really do offer customers better value for money. The brief The study was one of the most comprehensive undertaken […]


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