TORONTO, Jan. 29 2007 – Canadian investors can benefit from two new classes of principal protected investments that generate potential returns based on the performance of two mutual funds.
The Bank of Montreal Manulife Investments Protected Deposit Notes are unique investments issued by Bank of Montreal that are linked to the performance of two mutual funds – the Elliott & Page Core Canadian Equity Fund and the Elliott & Page Dividend Fund, managed by Manulife Mutual Funds, a division of Elliott & Page Limited. The Total Return Class Deposit Notes provide full principal protection at maturity by Bank of Montreal. The R.O.C. Class Deposit Notes provides investors with 100 % principal protection over the term of the Deposit Note by Bank of Montreal.
Assets invested in the Deposit Notes are initially allocated equally between the two underlying funds. As markets fluctuate, investors may benefit from the Deposit Notes’ dynamic allocation strategy. This strategy responds to market conditions by increasing exposure to the funds when equity market performance is positive and reducing exposure to the funds and allocating assets to a notional bond portfolio when equity market performance is negative. In this way, the Deposit Notes have the potential to enhance investors’ returns and provide downside protection over time.
“With the recent announcement concerning the taxation of income trusts, many investors are unsure if they should now invest in established companies that pay dividends for income purposes, or in growing companies that have the potential to generate capital gains for additional tax efficiency,” says Bob Tillmann, Vice President, Marketing and Business Development at Manulife. “With these two classes of Deposit Notes, people have a choice. They can invest in a tax efficient manner in both types of companies in a single investment with distribution of principal, or they can invest for growth. Plus, they get the security of knowing their original principal is protected.” The Bank of Montreal Manulife Investments Protected Notes, R.O.C. Class, provide income-oriented investors with monthly distributions in the form of repayments of principal and potential long-term capital growth. Additional features of the R.O.C. Class include:
- 100% principal protection over the term of the Note by Bank of Montreal as issuer if held to maturity;
- Potential for enhanced exposure to the total return of a notional investment in the Fund Portfolio;
- Potential for tax deferred growth – systematic repayment of principal of $5 per annum on a $100 Deposit Note paid in fixed monthly installments with no current tax implications;
- A dynamic asset allocation strategy;
- A 7.5 year term to maturity;
- Generally, a minimum 20% exposure to the increase in value, if any, of the Fund Portfolio on the deposit balance at maturity;
The Bank of Montreal Manulife Investments Protected Notes, Total Return Class, Series 1 and Series 2, provide growth-oriented investors with the opportunity to have equity market exposure without placing their principal investment at risk. Additional features of the Total Return Class include:
- 100% Principal protection at maturity by Bank of Montreal as issuer;
- Potential for enhanced exposure to the total return of a notional investment in the Fund Portfolio;
- Potential for tax deferred growth – 100% of distributions from the underlying funds, if any, are notionally reinvested in the Fund Portfolio for growth with no current tax implications for investors;
- A dynamic asset allocation strategy;
- Term to maturity of approximately 6.1 years for Series 1 and 6.0 years for Series 2;
- Generally, a minimum 20% exposure to the increase in value, if any, of the Fund Portfolio on the deposit amount at maturity;
To help investors benefit from market participation, the Bank of Montreal Manulife Investments Protected Deposit Notes, allow investors to access the professional management of the two underlying mutual funds:
- The Elliott & Page Dividend Fund is managed by Alan Wicks, Vice President and Senior Portfolio Manager, MFC Global Investment Management. With over 15 years of investment experience, Alan leads the Canadian Value Equity team managing value and equity income assets of more than $6.8 billion (as at September 30, 2006).
- The Elliott & Page Core Canadian Equity Fund is managed by Pat McHugh, Vice President and Senior Portfolio Manager, MFC Global Investment Management. With more than 20 years of investment experience, Pat leads the Canadian Core Equity team managing more than $635 million in assets (as at September 30, 2006).
The Bank of Montreal Manulife Investments Protected Deposit Notes, Total Return Class, Series 1 and 2 and R.O.C. Class, Series 1 are sold by advisors licensed by the Investment Dealers Association of Canada and licensed mutual fund dealers. Series 1 of the Total Return Class are available for purchase until March 16, 2007 and Series 2 of the Total Return Class is available for purchase until April 20, 2007. The R.O.C. Class, Series 1 is available for purchase until March 16, 2007. Details regarding this investment product, including a discussion of risk factors relating to the Deposit Notes, are contained in the Information Statements that can be obtained from your financial advisor.
