Principal Protected Notes

All-Star Portfolio Notes, Series 1

Product Summary

Inception Date May 16, 2003
Maturity Date December 31, 2010
Offering Price $10.00
Guarantee Amount $......
Market Price Per Note $......
Investment Exposure as at June 30, 2009 0%

The ONE Financial All-Star Portfolio Notes™, Series 1 have been developed by ONE Financial to provide conservative investors with the opportunity to access a diversified portfolio of top-performing mutual funds, with the additional comfort of a 100% guarantee on principal at maturity. The Notes provide a simple portfolio solution; a diversified portfolio of five top-performing mutual funds with 100% principal-guarantee, a tax-efficient structure, plus the potential for leveraged returns.

  • Issued by BNP Paribas Canada and guaranteed by BNP Paribas S.A. (Paris), one of the largest banks in the world
  • 100% principal guarantee maturing in 2010
  • Five All-Star Funds: CI Harbour, Bissett Canadian Equity, AGF European Equity Class, Templeton Growth Fund, and CI Canadian Bond
  • 100% RRSP eligible as Canadian property
  • Tax deferral - no annual distributions
  • Initial Closing Date: May 15th, 2003

Investment Details

Style Mutual Fund / Principal-Guaranteed
Underlying investment AGF European Equity Class Fund, CI Harbour Fund, CI Canadian Bond Fund, Bissett Canadian Equity Fund, Templeton Growth Fund
Guarantor BNP Paribas S.A. (Rated AA by S&P)
Administrator ONE Financial
Leveraged return potential Yes, up to 175% "performance-based" investment exposure
Liquidity Weekly
RSP eligibility 100% (Canadian content)
Performance as at June 30, 2009
Returns as at June 30, 2009
1 Month 1.45%
3 Months -0.41%
6 Months -0.60%
Year-To-Date -0.60%
1 Year -20.87%
3 Year (annualized) -15.76%
5 Year (annualized) -5.81%
Total Return since Inception -17.40%
Initial Price $10.0000
Current Price $8.2600
Diversification by Manager as at June 30, 2009
Fund Targeted % Portfolio Allocation Manager Style Investment Selection Process Region
AGF European Equity Class Fund 20% John Arnold & Rory Flynn Value Bottom-up, strong franchise companies trading at a discount Europe
Bissett Canadian Equity Fund 20% Fred Pynn & Garey Aitken GARP Bottom-up, select above average return companies with reasonable valuation Canada
CI Signature Canadian Bond Fund 10% James Dutkiewicz Income Primarily Government bonds, through yield curve analysis Canada
CI Harbour Fund 20% Gerry Coleman & Stephen Jenkins Value Bottom-up, focused portfolio of high quality companies trading at a discount Canada
Templeton Growth Fund 30% Lisa Myers Value Bottom-up, select out of favour companies with large growth potential Global

Underlying Mutual Funds

Commentary as at June 30, 2009

The ONE Financial All-Star Portfolio Notes, Series 1 (the "Notes") are linked to a portfolio of five all-star mutual funds managed by experienced managers (the "Portfolio"). Each of the funds selected for the Portfolio were chosen for their excellent long-term track records of delivering strong, consistent performance. Since the inception date of the Notes, the performance of each of the funds has been: 26.4% for the AGF European Equity Class Fund, 38.4% for the Bissett Canadian Equity Fund, 23.4% for the CI Signature Canadian Bond Fund, 74.5% for the CI Harbour Fund, and 12.0% for the Templeton Growth Fund.

Most equity markets around the globe experienced growth in the second quarter of 2009. The S&P 500 was up 15.2%, the MSCI Far East was up 21.9%, while the MSCI Europe was down 13.4%. Similar these international markets, the Toronto TSX composite was up, increasing 19.0% due largely to the diversified metals, financials, and information technology sectors. The price of the Notes will not track the performance of a static portfolio invested since inception of the Notes according to the Portfolio's targeted allocation, and is affected by many inter-related factors including:

  • the Portfolio "Dynamic Asset Allocation" feature,
  • the performance of each of the funds in the Portfolio,
  • changes in the level of interest rates,
  • time remaining until the Notes' maturity date, and
  • market demand for the Notes.

The difference between the performance of the Notes and the performance of a static portfolio invested according to the Portfolio's targeted allocation can largely be attributed to the Portfolio's "Dynamic Asset Allocation" feature. This feature is designed to both protect the Portfolio's net asset value (or "NAV") on the downside, and pursue leverage returns on the upside.

Exposure to the funds is adjusted regularly and systematically according to a nondiscretionary re-weighting procedure. Generally, as the value of the Portfolio increases, the Portfolio will potentially leverage its investments according to the targeted allocation up to a maximum of 175% of its NAV in order to pursue enhanced returns, and as the value of the Portfolio decreases, it potentially (i) de-leverages its investments in order to protect its NAV, and (ii) if the exposure is less than 100%, reallocates its investments from the four equity funds to a greater weighting in the CI Canadian Bond Fund. The Portfolio's performance to date has resulted in a current allocation to the Bonds of 100%, thereby giving it greater exposure to interest rate movements. Although the Portfolio will not directly track the performance of an investment in the underlying funds according to a static allocation during the term of the Notes, if the Portfolio is expected to provide solid, consistent performance throughout the term, then investors should benefit from the strong potential for leveraged returns at maturity.

Purchase

This Note has matured.

The Guarantor

BNP Paribas

BNP Paribas was established in 1848, and according to rankings published in July 2005 by The Bank, is the sixth largest banking group in the world and the largest in Europe based on total assets of approximately CAD $1.7 trillion (approximately the size of the Canada's five largest banks combined). As one of the world's leading diversified financial institutions BNP Paribas is present in over 85 countries, and has approximately 100,000 employees worldwide.

The BNP Paribas Group is organized around three core businesses: Retail Banking, Corporate & Investment Banking and Private Banking & Asset Management. Through its 2,200 branches across France and worldwide, BNP has more than twenty million individual and small business customers and 50,000 corporate customers.

BNP Paribas' long term debt ratings are: AA with a stable outlook from Standard & Poor's, Aa2 with a stable outlook from Moody's, and AA with a stable outlook from Fitch.

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