In a context of declining rates of return on euro funds which may persist for some time, we have developed, together with the insurer La Mondiale Partenaire (LMP) and Crédit Agricole CIB* (CACIB), an innovative offer that is both complementary and alternative to euro funds. Matthieu Monlun, Managing Director of the Equity Solutions business line at CACIB, presents the offering.
What is the December 2024 Principal-Protected Green Option?
Available in LMP life insurance and capitalisation contracts, this unique solution combines La Mondiale’s return on general assets with the performance potential of the MSCI Europe Select Green 50 5% Decrement index.
The December 2024 Principal-Protected Green Option is a special vehicle denominated in units of account, the “December 2024 Green Horizon” EMTN, managed by Crédit Agricole CIB. It benefits from both Crédit Agricole CIB’s permanent 90% guarantee of the initial amount invested and protection of the principal** provided by the insurer at maturity (30 December 2024).
Consequently, the performance of the investment after 4 years and 7 months will be linked to the capitalised return on the general assets of La Mondiale, to which is added the valuation of the diversification compartment (Equity index MSCI Europe Select Green 50 5% Decrement) and an additional contribution from the insurer to protect the principal**.
It is recommended to remain invested in the option through to its maturity (4 years and 7 months). In the event of disinvestment before 30 December 2024, the insurer’s protection* will no longer apply and the value of the vehicle may fluctuate up or down depending on changes in the index.
However, the savings remain available throughout the life of the product thanks to its daily liquidity with a minimum valuation of 90% of the amount initially invested.
The December 2024 Principal-Protected Green Option is compatible with all other units of account referenced on the contract and is accessible through arbitration or payment from the euro fund or the Tempo Option.
Can you tell us about the MSCI Europe Select Green 50 5% Decrement option underlying the Principal-Protected Option?
Global warming affects all economic actors and it has been proven that climate-related risks can impact many sectors of the economy.
So we have worked with MSCI to develop a new index of values directly involved in energy transition and the fight against global warming.
Starting from an initial universe of 1,400 securities representing almost all of European market capitalisation, the index uses exclusion and inclusion criteria that allow us to manage controversies and select the most virtuous companies from an environmental point of view. Finally, after this rigorous selection, the index is made up of the 50 equities with the highest float-adjusted market capitalisation.
Through this index, the December 2024 Principal-Protected Green Option allows you to invest in values participating directly in energy transition and in the fight against global warming.
The concept of “Decrement 5%” amounts to resolving the uncertainties around future dividend amounts by taking the net dividends of the securities making up the index and reinvesting them in the index, and subtracting a predetermined amount of 5% per year from the level of the index.
Who is the December 2024 Principal-Protected Green Option for?
The December 2024 Principal-Protected Green Option is accessible to both individuals and legal entities.
This solution is designed for investors (individuals or legal entities) wishing to diversify their investments in the context of LMP life insurance policies or capitalisation contracts and take advantage of market opportunities***, and looking for an alternative to euro funds while protecting their principal.
However, being classified as a complex debt instrument under French law, the December 2024 Principal-Protected Green Option is only intended for people with financial knowledge and experience.
* Crédit Agricole CIB is the corporate and investment banking arm of Crédit Agricole group
** Protection of the principal at maturity means that at the final recognition date, the insurer will pay you, under the option, an amount at least equal to 100% of your initial investment, less the fees charged at the time of your investment and the arbitration and management fees (0.8% per year). This condition is only applicable at maturity and if the valuation of the option is less than 100% of the initial principal.
*** Past performance should not be taken as an indicator of future performance and may vary over time.
Under no circumstances can this article be construed as an offer to subscribe to a life insurance policy or capital bond, or an offer or solicitation, or canvassing for the purpose of subscribing to financial products or services. You are recommended to carefully read the KIID (or the prospectus), the Key Information Document, the Detailed Notice or the final terms and conditions of the product or service before subscribing. Past performance is not an indication of future performance, and the value of an investment can go down as well as up depending on developments in the financial markets.
April 20, 2020