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Media centre /
Press release125% OF ANY FTSE GROWTH WITH NEW GUARANTEED EQUITY BOND FROM NS&I09 May 2005New online service: customers able to invest in National Savings and Investments new GEB at www.nsandi.com from 11 May National Savings and Investments (NS&I) is to launch a brand new Guaranteed Equity Bond which will offer a return equal to 125% of any growth in the FTSE 100 index over the five-year term of the Bond, without any risk to investors’ capital. And to make it even easier to save with NS&I, customers will be able to invest online at www.nsandi.com using a debit card. This is the first time NS&I’s Guaranteed Equity Bond has been available to buy online. Offer periodIssue 10 of the GEB goes on sale for a limited period of eight weeks from 11 May to 5 July 2005. It may close earlier if fully subscribed, so investors are encouraged to buy early, particularly because their investment will earn interest at 4.00% p.a. gross during the eight week offer period, paid when the Bond matures. Investment levelThe minimum investment level for this GEB remains at £1,000 – as with the previous three offers – consistent with NS&I’s approach to make this offer more accessible to a wider number of people. Although the maximum investment is £1 million per person, or £2 million for a joint investment, the maximum online purchase is £99,999. This limit for online purchases is set by Barclays Merchant Services. How to buy NS&I’s Guaranteed Equity BondInvestors can apply online at www.nsandi.com, by phone with a debit card on 0500 500 000 or by post using an application form which can be requested by phone or downloaded from NS&I’s website at www.nsandi.com. Application forms for the NS&I Guaranteed Equity Bond will not be available at the Post Office. ReturnThis new GEB offers a gross return equivalent to 125% of any growth in the FTSE 100 index over the five-year term, with no upper limit or cap on the return. The 125% figure means the investment will earn a return equivalent to all of the growth in the FTSE 100 index over the five-year term, plus an extra 25% of FTSE growth on top. For example, if the FTSE 100 index rose by 20% over the five-year term, £10,000 invested would earn a gross return of £2,500 (customer receives £12,500) at the end of the five years – i.e. 25%. If the FTSE rose by 30% over five years, £10,000 would earn £3,750 (customer receives £13,750, i.e. 37.5%). Even if the FTSE 100 index falls or fails to rise over the term, investors’ initial investment is returned in full, e.g. the FTSE 100 index falls by 20% over the five-year term, the customer would receive their £10,000 invested back in full. Demand has been high for NS&I’s previous issues – the first nine sold over £800 million since Issue one was launched in March 2002 – and more than 29,000 people have asked to be given advance information about Issue 10. A further 4,000 people registered using NS&I’s online service, launched in January this year. NS&I’s last GEB (Issue 9) was on sale between 15 September and 9 November 2004 and offered a return equal to 105% of FTSE growth. NS&I Guaranteed Equity Bond key features
John Prout, National Savings and Investments sales director, said: “This new guaranteed equity bond is a must for any investor looking for a cash deposit where the returns are linked to the performance of the FTSE but are also guaranteed to beat that performance by a further 25%. “On top of that, all capital is guaranteed to be 100% secure, even if the FTSE falls, and you can invest from the comfort of your own home, either online or by phone. It couldn’t be simpler.” ENDS Notes to Editors 1. NS&I’s previous GEBs offered the following capped rates of return: GEB 1: 65%, GEB 2: 70%, GEB 3: 65%, GEB 4: 60%, GEB 5: 65%. GEB 6: 95% participation rate, GEB 7: 110% participation. GEB 8: 75% participation or 15% guaranteed minimum return. GEB 9: 105% participation. 2. NS&I has GEB customer case studies available on request 3. In summary, the NS&I Guaranteed Equity Bond Issue 10 offers:
4. Why have investors purchased NS&I Guaranteed Equity Bonds?
5. National Savings and Investments is one of the largest savings organisations in the UK which offers a range of savings and investments products. It has around 26 million customers and £68 billion invested. All products offer 100% security, because they are backed by HM Treasury 6. Further information and digital images are available from the NS&I Media Team NS&I Media Team
Media team The numbers below are for media use only. Customers wishing to contact NS&I can find details here.
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