BDO Investment Interests

What is Unit Investment Trust Funds

Unit Investment Trust Funds are trust funds made available for investors. Bank offerings and services have varieties of selections that allow clients to choose funds apt to their needs. BDO’s Unit Investment Trust Funds (UITFs) have wide range of funds to fit different needs of the clients including their financial status, their goals for investment, period target and the company security.

Unit Investment Trust Fund

Bangko Sentral ng Pilipinas (BSP) subjected an issuance in creating UITFs under Circular 447 on September 3, 2004 to secure operation of pooled funds or funds that come from many individuals combined for investment purposes. This law is formed to the best interest of every bank client keeping the best practices aligned to the international trust tradition.   

Why Invest in BDO

BDO has several advantages when it comes to Unit Investment Trust Funds’ selection and services. Consider the following:

• BDO has the top and excellent fund managers. All are experienced enough to handle different investment matters. Having top fund managers have been the edge of BDO to be honored with the best performing fund manager for 2001 to 2003, three consecutive years by Watson Wyatt Survey on Investment Performance.

• BDO UITFs have higher returns than other banks offering the same services since they are fully invested and have no requirements reserved.

• BDO UITFs are very liquid since they are only invested in tradable securities which are highly valued at market.

• BDO secures a Regulatory Measures to inform and protect investors. These are:

a. security safekeeping and valuation by a third party custodian/s

b. audits are done by external auditors accredit by Bangko Sentral ng Pilipinas

c. public especially clients are able to follow BDO updates through the general circulation of NAVPU weekly publication

d. sales personnel are highly equipped trough standardized UITF training program and seminars

e. BDO secures quarterly reports to participants

UITF participation is certified by Participating Trust Agreement and a Confirmation of Participation.

BDO’s valuation of the UITF is apparently based on the market-to-market Net Asset Value per Unit (NAVpu) regularly computed. The NAVpu is available at 3 pm at BDO Branches and at the BDO Website. It is also available via text. Type "SMAC NAV" and send to 2213 (Smart, Globe or Sun) (P2.50/text).

Information on NAVpu stated that acceptances and notices of redemption of participation in the UITF are serviced by all BDO Branches on or before 12:00 noon on a banking day.

The following is schedule of redemptions:

• Name of UITF

• Redemption Payout

• BDO Peso Money Market Fund

• After 3 pm of the same day that notice of redemption is received by the BDO Branch

• BDO Peso Bond Fund, BDO Fixed-Income Fund and BDO $ Money Market Fund

• One (1) banking day after notice of redemption is received by the BDO Branch

• BDO Balanced Fund and BDO $ Bond Fund

• Three (3) banking days after notice of redemption is received by the BDO Branch

• The value of redemption is computed based on the NAVpu on the date the redemption notice was received by the BDO Branch and not on the payout date. When in the opinion of the Trustee, the interest of the Fund/Participants so requires, BDO reserves the right to require a five-banking-day written notice in advance of any redemption of participation.

• Redemptions during prescribed minimum holding periods are subject to early redemption fees as shown in the table below.

BDO Custody of Securities

Standard Chartered Bank as the custodian of the BDO UITFs manages the investments in fixed income securities. The fee for custodian ranges from 1.80 and 1.95 bps p.a. This is based on the face value of the securities plus transaction fees all are charged to the particular fund.

Fund Accounting / NAV Computation

RG Financial Services Ltd. (Philippines) provides the accounting services that include the computation of the daily net asset value per unit (NAVpu). The fees for services are all included in BDO-Trust fees.

BDO Peso Money Market Fund

The BDO Peso Money Market Fund is a peso-denominated fixed-income fund suited for corporate and individual clients who are risk reluctant and are looking for protected investments with yields higher than those of savings and time deposit accounts. This Fund aims to preserve capital and generate income from low risk investments by investing the Fund in fixed-income securities with a portfolio weighted average life of not more than one (1) year. Minimum investment is P100,000.

The BDO Peso Bond Fund

The BDO Peso Bond Fund is a peso-denominated fixed-income fund that aims to take advantage of higher yields offered by medium-term securities by investing its assets in bonds and other similar fixed-income securities with a portfolio weighted average life of more than one (1) year. This is particularly suited for corporate and individual clients who are risk tolerant and are looking for higher yields but are willing to take the attendant risks due to the longer term of the Fund’s investments. This Fund makes as its cornerstone the philosophy that the “key to investing is time”. Minimum investment is P100, 000.

BDO Fixed-Income Fund

The BDO Fixed-Income Fund is a peso-denominated fund that aspires to provide its participants a high level of income while preserving principal and maintaining liquidity, by investing in a combination of short-term and long-term fixed income securities. This Fund is designed for corporate and individual clients who are looking for investments that have moderate yields and can tolerate moderate risks. Minimum investment in this Fund is P10, 000.

BDO Balanced Fund

The BDO Balanced Fund is a peso-denominated fund that sets its sight on capital appreciation over the medium-term by investing in a combination of equities and fixed-income securities while still upholding a prudent investment stance. The allocation between equity and fixed-income securities shall be determined by BDO, depending on market conditions. This Fund would be appropriate for corporate and individual clients who are aware of the potential for high yields in stock market investments but are also knowledgeable of the potential for capital losses that such investments entail. The time horizon for investment in this Fund is medium to long-term. Minimum investment in this Fund is P10,000.

BDO $ Money Market Fund

The BDO $ Money Market Fund is a USD-denominated fixed-income fund, the objective of which is to preserve capital and generate income from low risk investments. For this Fund, fixed-income securities with a portfolio weighted average life of not more than one (1) year are selected. This would suit risk-averse corporate and individual clients who are looking for safe investments with yields higher than those of savings and time deposit accounts. The time horizon for investment in this Fund is short-term i.e. less than one year. Minimum investment is USD 2,000.

BDO $ Bond Fund

The BDO $ Bond Fund is a USD-denominated fixed-income fund that seeks higher yields over the medium-term by investing its assets in bonds and other similar fixed income securities. This Fund would fit corporate and individual clients who are looking for higher yields and are willing to take the attendant risks due to the longer term of investments. The time horizon for investment in this Fund is medium to long-term i.e. more than one year. Minimum investment is USD2, 000.

What is COMMON TRUST FUNDS

Common Trust Funds (CTFs) are alternative investment outlets wherein BDO, as the trustee bank, pools funds from thousands of participants and invests these in a diversified mix of selected fixed-income securities. Participants in a CTF are able to enjoy the following benefits: professional fund management, better yields, safety of investments, liquidity as well as ease of monitoring of fund values.

The Two-Year Dollar Fixed Rate Time Deposit

This is a two year fixed rate dollar denominated instrument that carries a higher yield than a regular time deposit. The funds are invested in various treasury bonds that are considered to be low risk instruments. Minimum placement amount is US$50,000.00.

• A dollar time deposit that carries a higher yield than a regular time deposit

• Investment is evidenced by a certificate of time deposit

• Investment term is two years with monthly interest payment

• Monthly interest payment and proceeds on maturity are credited to the client's designated savings account

• Minimum Investment amount is US$50,000.00

• Interest earned shall be subject to 7.5% withholding tax

• No partial withdrawals or pre-termination shall be allowed

• For pre-termination within 6 months from placement date, the interest shall be reduced to the regular savings interest rate

• There will be no rate reduction forpre-termination after the 6th month.