Trade finance, new mutual fund, and other autumn innovations

Riga, Latvia, September 17, 2015, 10:30 / Banking

Transactional commodity trade finance, loan against company’s business value, new mutual fund and bond issues, better insurance conditions, new Pillar home page, apartments meeting high living standards, simplified logging in to the Internetbank for iPhone and iPad — these are the main improvements in products and services that will be implemented in the following months.

1. New mutual fund and bond issues

Continuing the tradition of offering new ABLV mutual fund each year, we offer ABLV Emerging Markets Corporate USD Bond Fund to our clients from 17 September this year.

The base currency of the new mutual fund is USD, and its assets will be invested in debt securities issued or guaranteed by companies and credit institutions registered in emerging countries. The fund has already been registered by the Council of the Financial and Capital Market Commission, and the fund manager is Sergejs Gačenko.

Including the new fund, 12 mutual funds are currently available to you. Those funds cover wide range of investments — from government bonds to total return funds.

At the same time, we introduce single principle of charging the fees for issue of investment certificates. From 17 September, for all bond funds this fee will be equal to 1.00% (decreased fees of ABLV High Yield CIS USD Bond Fund and ABLV High Yield CIS RUB Bond Fund), and for stock and total return funds — to 1.50% (decreased fees of ABLV Global USD Stock Index Fund and ABLV Global EUR Stock Index Fund).

Continuing the issuing of the bank’s bonds launched in 2011, in October this year we will also perform three new bond issues under the Fifth Bond Offer Programme, and these issues will be admitted to regulated market — Baltic list of debt securities of Nasdaq Riga stock exchange.

The subscription to the bond issues starts on 17 September 2015 and will last till 19 October 2015. The parameters of the issues are stated below.

  • Coupon bond issue of USD 75 000 000 (issue name: ABLV FXD USD 261017; ISIN: LV0000801850)
    The issue size is USD 75 000 000. The number of bonds is 75 000. The face value of one bond is USD 1 000. The annual interest rate is fixed: 1.65% with coupon payment twice a year. Initial placement price: 100% of the face value. The issue date is 26 October 2015, and the maturity date is 26 October 2017.
  • Coupon bond issue of EUR 20 000 000 (issue name: ABLV FXD EUR 261017; ISIN: LV0000801868)
    The issue size is EUR 20 000 000. The number of bonds is 20 000. The face value of one bond is EUR 1 000. The annual interest rate is fixed: 0.80% with coupon payment twice a year. Initial placement price: 100% of the face value. The issue date is 26 October 2015, and the maturity date is 26 October 2017.
  • Discount bond issue of EUR 20 000 000 for the sake of raising subordinated capital (issue name: ABLV SUB EUR 261025; ISIN: LV0000801835)
    The issue size is EUR 20 000 000. The number of bonds is 200 000. The face value of one bond is EUR 100. Initial placement price: 83.047% of the face value. The issue date is 26 October 2015, and the maturity date is 26 October 2025. The bank may redeem the bonds before maturity starting from 26 October 2020.

Annual interest rate of subordinated bonds:

  • from 26 October 2015 till 26 October 2020 — fixed discount rate of 3.75%;
  • from 27 October 2020 till 26 October 2025 — fixed coupon rate of 3.75% with coupon payment twice a year.

2.  Transactions in derivatives in RUB at trading platform

Improving the electronic trading service, we offer our clients to perform transactions in futures and futures options in RUB via trading platform Quik Trader ABLV. The charges for using Quik Trader ABLV remain unchanged: connection is free of charge, and fee for use is RUB 300 per month.

Besides the said trading platform, two more are currently available to our clients:

  • J-Trader ABLV — for trading in derivative financial instruments at stock exchanges of the USA and Europe,
  • Orbis Trader ABLV — for trading in the US securities.

3.  Trade finance

We offer new financing service — transactional trade finance for commodities traded on stock exchange and over the counter. This service will be interesting for traders who have successful experience of trading in highly liquid raw materials.

We offer transactional trade finance for such commodities as energy raw materials (crude oil, oil products, coal, gas), chemicals (methanol, benzene, mineral fertilizers, etc.), and different metals. These commodities should be moved from Baltic or CIS states to any place in the world.

Within this service, we are ready to provide financing of the whole transaction cycle — from prepayment to the supplier to receivable financing after the delivery. The maximum loan amount can be up to EUR 20 million.

4.  Loan against company’s business value

We also offer granting of loans secured by business value of a company to the corporate clients. This is an alternative solution in lending — unlike general practice, under which loans are mostly secured by real estate, this type of loan involves assessment of the business ability to generate income.

Such loans can be obtained by legal entities having more than 5-year long experience of operating in Baltic states. The maximum loan amount can be up to EUR 15 million, and shares of the company’s capital will be used as main pledge under the loan.

5. Overdrafts in CHF, RUB, and GBP

Within consistent broadening of client opportunities to make settlements in different currencies, we offer the possibility to obtain overdrafts and use overdraft lines in three new currencies — Swiss francs (CHF), Russian roubles (RUB), and British pounds (GBP). Earlier, overdrafts were available in USD and EUR only.

6.  Better insurance conditions

In the autumn release, we paid great attention to our insurance services — travel and residential property insurance.

From 1 October this year, the list of risks insured under travel insurance will be expanded for holders of Gold and Gold Business, as well as Platinum and Infinite payment cards. For example, insurance of Gold and Gold Business level will include the risk of travel cancellation or delay of transit flight. The limit of insurance compensation for holders of Classic and Business cards will be equal to that under Gold and Gold Business level.

At the same time, maximum period of stay outside the country of residence has been set, and pursuant to Latvian laws it is equal to 120 days per year for all policies. Also, maximum limit of compensation for holders of Infinite cards has been set equal to EUR 200 000.

Another significant innovation is the possibility to include unlimited number of children under 17 years of age in the insurance policy, subject to additional fee.

From 1 October, new conditions of travel insurance will be automatically applied to policies made earlier. Please find out a new version of the rates and charges 'Payment Cards and Premium Cards', which becomes effective on 1 October 2015.

Whereas under insurance of residential property, in cooperation with Latvian branch of Seesam Insurance AS and Latvian branch of Compensa TU S.A. Vienna Insurance Group we have developed two unique insurance policies for our clients:

  • ABLV Apartment Insurance;
  • ABLV House Insurance.

Besides real estate insurance, these policies include insurance of movable property (furniture, kitchen and household appliances, etc.), landscape elements (fences, gates, lighting fixtures, etc.), and civil liability.

Additional bonus under both policies is the compensation of expenses related to temporary rent of accommodation in case of moving or the property becoming inhabitable.

7. Client service calendar for 2016

For the convenience of our clients, we have already made the client service calendar for the whole 2016. The calendar includes information on client service during holidays in different countries and non-working days of stock exchanges. The calendar is available at our home page.

8. Pillar — closer to clients

New home page of our affiliate company — real estate developer Pillar has been developed to promote the company’s brand. The new home page is more convenient, modern, and competitive, compared to home pages of notable Latvian real estate companies. You are welcome to visit it at www.pillar.lv

To those interested in high-quality residential property, Pillar offers premium apartments in recently commissioned building in Riga, at 57a Miera Street — Miera Park House. At the beginning of 2013, Pillar purchased this new building from affiliate company of SEB bank for EUR 2.4 million. The amount of investments in renovation and finishing works reached EUR 5.8 million.

Miera Park House is one of a few premium apartment houses in Riga, and modern technologies were applied during construction of the same to ensure high quality of life.

The sale price of apartments in Miera Park House is from EUR 1700/m². It should be noted that ABLV Bank offers advantageous conditions under loans for purchase of these apartments. Currently, five apartments have been sold and four other have been booked.

9. Simplified logging in to the Internetbank for iPhone and iPad

We have already informed about introducing two-factor authentication to ensure additional safety of using our Internetbank. Now, to log in to the Internetbank, the user needs to enter not just the user ID and password (first factor), but also a code card or Digipass value — the authorization code (second factor).

The clients using our Internetbank application for iPhone and iPad are offered to use the unique device identifier as a second factor, starting from 21 September. Thus, given the user’s consent, our Internetbank application will be able to automatically recognize particular iPhone or iPad device used by the client for accessing the Internetbank and will not request additional input of code card or Digipass value (second factor).

We wish you a fruitful autumn!

Ilmārs Jargans
Head of Public Relations Department
+371 6777 5296
ilmars.jargans@ablv.com