New Structured Product: SG18 - The Euro Defensive Autocall 8

YOU SHOULD TAKE THE TIME TO READ THE WHOLE OF THE PRODUCT GUIDE BEFORE MAKING ANY INVESTMENT. YOU SHOULD READ THE PRODUCT GUIDE CAREFULLY AND KEEP IT SAFE FOR FUTURE REFERENCE

YOU COULD GET 8%* PER YEAR, EVEN IF THE EURO STOXX 50 FALLS BY 30%

*RETURN IS BASED ON THE ISSUE PRICE OF £100 PER UNIT. IT IS GROSS, NOT COMPOUNDED, AND CAPPED AT 48%

 

 The Euro Defensive Autocall 8 (SG18) has an Investment Term of up to 6 years, and is linked to the performance of the Euro Stoxx 50 Index. The aim of SG18 is to generate a gross return equivalent to 8% per year, and return your initial investment at maturity, or earlier.

 The ability of SG18 to pay any Gross Return and return your invested capital is dependent on the ability of Societe Generale to satisfy its obligations.

 GENERATING A PAYOUT AFTER A YEAR

 SG18 can expire early in any year from 1-5. If it does, it will pay a gross return equivalent to 8% per year, and return your initial investment in full.

  For early expiry to happen, the Index must close at or above its target ‘Yield Level’ on the specified valuation date that year. If it fails to expire in any year, SG18 simply continues to the following year, the Gross Return rolls over, and the process is repeated on the next valuation date. This happens each year until either the Product expires, or it reaches Maturity.

POTENTIAL RETURNS PER UNIT IN YEARS 1-6

  

FOR ILLUSTRATIVE PURPOSES ONLY. THE FIGURES ARE EXAMPLES ONLY AND USED TO ILLUSTRATE THE RETURN THAT COULD BE ACHIEVED ON EACH VALUATION DATE IF THE INDEX CLOSES AT OR ABOVE ITS KICK OUT LEVEL ON THAT SPECIFIC DATE.

INCREASING THE CHANCE OF A PAYOUT IN YEAR 6

If the Product has failed to expire early in years 1-5 of the Investment Term there is one last chance to generate a payout, and get your capital back on the Final Valuation Date. At this point the target is no longer the Yield Level, but the Protection Level. Because the Protection Level is 30% below the Yield Level, you have a higher chance of gaining the maximum Gross Return and your capital back at Maturity.

 As the diagram below shows, there are two possible scenarios for what can happen if the Product reaches Maturity. Which occurs is dependent on the closing level of the Index on the Final Valuation Date:

 1. If the Euro Stoxx 50 Index closes at or above the Protection Level (70% of the Initial Level), you will receive £148 per unit at Maturity, which includes the maximum Gross Return and your initial investment of £100 per unit.

 2. If the Euro Stoxx 50 Index closes below the Protection Level (70% of the Initial Level) on the Final Valuation Date, you will not only miss any Gross Return on your investment, but part or all of your initial investment will be lost. You will be exposed to the performance of the Index from the Initial Level with every 1% fall in the level of the Index resulting in a loss of 1% of the Issue Price.

POTENTIAL RETURNS PER UNIT AT MATURITY

The chart below illustrates the potential amount paid out per unit at Maturity based on the performance of the Index over the Investment Term. 

FOR ILLUSTRATIVE PURPOSES ONLY. THE FIGURES ARE EXAMPLES ONLY AND USED TO ILLUSTRATE THE RETURN THAT COULD BE ACHIEVED AT MATURITY FOR DIFFERENT INDEX CLOSING LEVELS.

HOW TO TRADE SG18

 SG18 can be purchased through a UK stockbroker using the EPIC code SG18, or the ISIN ‘JE00BW9PHY20’. You can trade it in a Dealing account, SIPP or ISA at a fixed price of £100 per unit until April 10th, 2015.  

 After April 10th, 2015, the price of SG18 will rise and fall on the London Stock Exchange, and you can buy or sell units at any time during market hours. There are no penalties for selling back early but the market price could be higher or lower than the Issue Price of £100 per unit.

KEY TERMS OF THE EURO DEFENSIVE AUTOCALL 8

  • Maximum 6 year investment
  • Linked to the performance of the Euro Stoxx 50 Index
  • Potential gross return equivalent to 8.00% per year (not compounded)
  • Defensive feature increases chance of payout in year 6
  • Capital at risk if the Euro Stoxx 50 Index has fallen by more than 30% at Maturity or if Societe Generale defaults
  • Intended to be eligible for SIPP and ISA investment*
  • Counterparty risk with Societe Generale

Full details of the Euro Defensive Autocall 8 (SG18), the issuer and the risks are available in the Product Guide and Final Terms. Please ensure you read these prior to investing.

KEY RISKS TO BE AWARE OF

To help you decide if SG18 is right for you, here is a summary of some key points to consider before investing. You should study the Final Terms and if you are unsure whether the Product is suitable for you, you should seek advice from an independent professional adviser before making an investment decision.

 

  • Capped returns.Your maximum Gross Return is capped at the equivalent of 8% per year. If at Maturity the performance of the Index is greater than 8% per year, the Product will underperform the Index. The return is gross (not compounded).
  • Inflation risk. If the total return generated by the Product is less than the rate of inflation, the value of your capital plus a Gross Return at Maturity will be reduced in real terms.
  • Capital is at risk. If the Index has fallen by more than 30% on the Final Valuation Date, part or all of your initial investment will be lost. You will be exposed to the performance of the Index from its Initial Level with every 1% fall in the Index resulting in a loss of 1% of the Issue Price of the Product.
  • Underlying risk. The price of the Index can be volatile and may fall significantly below its Initial Level.
  • Early sale risk. You can sell the Product before the end of the Investment Term but may get back less than you invested irrespective of the performance of the Index.
  • Liquidity risk. Societe Generale is the only market maker and therefore the only party providing prices for the Product. Trading prices will only be available in normal market conditions. For more information regarding trading, please see the ‘Secondary Market’ section on page 18 of the Product Guide.
  • Counterparty Risk. The Product is issued by SG Issuer, a 100% subsidiary of Societe Generale and Guaranteed by Societe Generale. Any failure by SG Issuer to make payments due under the Product may result in the loss of all or part of your investment. Insofar as payments are due by Societe Generale in its capacity as Guarantor, investors are exposed to a credit risk on Societe Generale. For more information on Counterparty Risk, see the Counterparty Risk section on page 17 of the Product Guide.

 

BUY NOW AT INTERACTIVE INVESTOR

 Investors holding an account with Interactive Investor can purchase directly by clicking the button below. You must complete a complex products assessment prior to trading. Find out more about opening an account with Interactive Investor. SG18 can be purchased through other stock brokers.

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THIS COMMUNICATION IS DIRECTED AT SOPHISTICATED RETAIL CLIENTS IN THE UK

This website is issued in the U.K. by the London Branch of Societe Generale.  Societe Generale is a French credit institution (bank) authorised by the Autorité de Contrôle Prudentiel et de Résolution (the French Prudential Control and Resolution Authority) and the Prudential Regulation Authority and subject to limited regulation by the Financial Conduct Authority and Prudential Regulation Authority.  Details about the extent of our authorisation and regulation by the Prudential Regulation Authority, and regulation by the Financial Conduct Authority are available from us on request.

*Any statement in relation to tax, where made, is generic and non-exhaustive and is based on our understanding of the laws and practice in force as of the date of this document and is subject to any changes in law and practice and the interpretation and application thereof, which changes could be made with retroactive effect. Any such statement must not be construed as tax advice and must not be relied upon. The tax treatment of investments will, amongst other things, depend on an individual’s circumstances. Investors must consult with an appropriate professional tax adviser to ascertain for themselves the taxation consequences of acquiring, holding and/or disposing of any investments mentioned in this brochure.

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