VALL BANC FONS SHORT TERM EURO, FI

Transcription

1 1. Identification data and characteristics VALL BANC FONS SHORT TERM EURO, FI Name of the UCI: VALL BANC FONS SHORT TERM EURO, FI Address of the UCI: Number 3 Carrer de la Unió, 1 st Floor, AD700 Escaldes-Engordany. Date and country where the UCI was established: 19/11/2001, Principality of Andorra. INAF registration number of the UCI: 0075 Supervisory authority: Andorran National Institute of Finance (INAF). Characteristics of the participations: registered. Duration: Established for an unlimited duration. Type of UCI: UCITS Investment funds. Number of sub-funds: no sub-funds envisaged Recommended time horizon: minimum period of one year. Classes of shares: class R (Retail) with registration number and class E (Employees) with registration number Currency of reference: EUR. Investor profile: aimed at investors with a low level of tolerance to risk who prioritize security and who are not willing to assume significant losses. Accordingly, it is intended for investors who want to obtain a slightly higher yield than that of a money market fund but without having to assume an excessive risk. Classification: RF - MULT (Fixed Income Multi-currency). Types of shares: capitalization shares. Date and method of distributing dividends: does not distribute dividends. MIFID Classification of the product: non-complex product. Other characteristics: the sub-fund has two types of participations differentiated by the fees that apply to them: these are class R (retail) and class E (employees). Class E is restricted, and it is intended exclusively for employees and ex-employees of the Vall Banc group. Date of the last update of this prospectus: 22/01/ Identification and functions of the Management Company: Name: VALL BANC FONS, SAU Address: Number 3 Carrer de la Unió, 1 st Floor, AD700 Escaldes-Engordany. Date established: 09/11/1992 INAF Registration number: SGOIC -04/99 Authorization: Entity authorized to operate in the Andorran financial system as a management company for undertakings for collective investment. Functions: The Management Company has full powers of representation and administration over the fund and its sub-funds and over all their assets. In addition, the functions of the management company are: 1. Managing the assets, which includes: -The investment decisions. -Exercising the economic and political rights inherent in the assets through the depositary. 2. Administrative management activities, including: -Determining net asset values, including the applicable tax system. -Carrying out accounting and legal tasks. -Preparing the prospectuses and the public reports. -Determining the distributable profits (only for UCIs with a distribution policy). -Overseeing compliance with applicable regulations. -Managing the register of participants. -Full judicial and extrajudicial representation of the UCI before all classes of natural persons and legal entities. 3. Managing liabilities, which includes: -Accepting subscriptions, redemptions (register of participants) and transfers of corresponding orders to the depositary. -Sending of orders for the redemption/sale of participations to the depositary. 1

2 4. Distribution-related activities, including: -Processing documentation (advertising reports, management reports, etc.). -Selecting distributors. 3. Identification and functions of the Depositary Entity: Name: VALL BANC, SAU Address: Number 119 Av. Carlemany, AD700 Escaldes-Engordany. Date established: 17/07/2015 INAF registration number: EB 09/15 Authorization: Entity authorized to operate as a banking entity within the Andorran financial system. Functions of the depositary. The functions of the depositary are: 1. Maintaining and safekeeping the assets of the UCI, although it may entrust the sub-custody of the assets to a third party or to a central securities depository in Andorra or abroad. 2. Settling operations on financial instruments and other assets of the UCI and the debit transactions of the UCI. 3. Ensuring that the management company or the UCI fulfils the rules set out in the law, the regulations and in the prospectus in relation to the following aspects: a) Procedures for calculating the net asset value as well as that of the price for issuing and redeeming the shares or participations of the UCI. b) The investment decisions of the UCIs. c) Distributing the profits of the UCI. 4. Links and joint functions between the depositary and the management company: Links: The Management Company and the depositary belong to the Vall Banc Group. Vall Banc Fons SAU is owned by Vall Banc SAU. Joint functions: those set out in Law 10/2008: 1. The management company and the depositary draw up the rules of the UCI together, and they establish them through a public deed. 2. The management company and the depositary establish the written depositary contract together. 3. The management company and the depositary prepare, issue, distribute and eliminate the certificates of participation together. 5. Identification and functions of the auditors Name: Ernst & Young Functions: Auditing of the public financial statements of the UCI and its sub-funds. In accordance with the provisions of Law 10/2008: 1. UCIs are obliged to submit their annual accounts for audit. 2. The auditing of the individual annual accounts of UCIs must be carried out in accordance with what is set out in the International Auditing Standards issued by the International Auditing and Assurance Standards Board. 3. The audit report must make mention of the validation of the valuation of any non-monetary contributions to the UCI. 4. The liquidation process must be supervised by the auditing entity, which must send a complete report to the INAF. 6. Information on the investments Objectives: Preservation of the assets by assuming a low risk in their investments. Benchmark index: 3-month EURIBOR basis points. This is simply an index of reference used as benchmark and in no case does the sub-fund seek to replicate its behaviour. Guarantee of performance/profitability: No guarantee of performance is given. Characteristics of the investment policy: The fund will mainly invest its assets in financial instruments on the short-term fixed income market and the money market, preferably denominated in euros, either 2

3 directly or else through investment in UCIs and ETFs that have these characteristics. The selection of the issuers will take the financial situation of the company or public body into consideration and the liquidity of the market on which the issue being analysed is listed will also be considered. The geographical distribution of the investment among the different countries that this fund invests in will not be predetermined a priori, and the manager will decide this geographical distribution in accordance with its perspective of the markets. In this regard, the fund may invest, directly or indirectly through investment funds, in marketable securities and money market instruments of issuers belonging to emerging countries, and this could carry an added risk for the portfolio. The distribution of the fund s assets among public and private issuers will not be predetermined a priori either and it will vary depending on the opinion and judgement of the manager, and accordingly the totality of the assets may be fully invested in both private fixed income assets and in public fixed income, either by direct or indirect investment through other financial instruments of the fixed income market and/or money market. Category of suitable assets: the suitable types and categories of assets include but are not limited to the following, provided that they are adapted to the objectives and characteristics of the investment policy described in the previous sections: Marketable securities, such as bonds and other transferrable debt securities and all other securities that grant the right to acquire these marketable securities. Money market instruments. Shares and participations of UCIs, including ETF. Bank deposits. Derivative instruments. Other financial instruments, including structured products. You are advised to carefully read the section on investment risks and you should consult the annexes in those cases where the UCI has sub-funds. Limitations of the investment policy: The limits on the diversification of risks are those defined in the current legal regulations, and the maximum limits of concentration by issuer are as follows: The fund may not invest more than 10% of its assets in each of the marketable securities or money market instruments issued by the same body. This percentage shall extend to 25% in case of certain bonds issued by a credit entity that has its registered offices in Andorra or in a Member State of the OECD, and backed up by assets that may be used as a matter of priority if the issuer becomes insolvent. This percentage of risk per issuer shall extend to 35% of the assets when these are issued or guaranteed by the Andorran state or a Member State of the OECD. Other limitations of the investment policy: By credit or solvency rating of the issuer: direct investments in issuers with a rating lower than BBB- (High Yield) may not exceed 30% of the assets of the fund. The rating of the issue will be granted by Standard & Poor s, Fitch or Moody s and it shall be understood that an issue is High Yield when none of the three agencies has granted a rating higher than BB+/ Ba1. If the issue has not been assessed by any of these three agencies, the rating of the issuer with the same criteria described above will be used. By currency: the net exposure to currency risk may not directly exceed 20% of the assets of the fund. By maturity or duration of the assets: the maturity of the assets that the fund will invest in may vary according to the judgement of the manager and it will take any possibly hedging with derivatives into account, without exceeding the average duration of two years in the overall position of the portfolio. Other limitations: the fund may acquire structured fixed income products that pursue objectives similar to those of the fund s investment policy, provided that these do not exceed 20% of the fund s assets. The sub-fund may temporarily maintain a high level of divestment and/or maintain a low net exposure to market risk when the market circumstances justify this according to the criteria of the Management Company. You are advised to carefully read the section on investment risks. 3

4 Possibility of debt: It may not fall into debt by more than 10% of the assets. Derivative instruments: The fund may invest in derivative instruments to hedge assumed risks and for speculation purposes. Investments in derivatives carry additional risks to those of investments at spot prices because of the leverage effect, and they are especially sensitive to variations in the price of the underlying asset and losses in the value of the portfolio may multiply. The overall risk associated with the investment via derivative instruments should not exceed the total net value of the portfolio under any circumstances. Risks of the investments: the investments that make up the portfolio of the UCI and/or its sub-funds are not risk-free, and they are not guaranteed either and so the net asset value of the participations could be affected by these risks. It should be emphasized that the investments of the UCI or the sub-fund could be directly or indirectly exposed to the following risks: Market risk: this is the risk of losses in the value of an asset associated with fluctuations in its market price. In particular, the list price of the assets depends on the performance of the financial markets as well as the economic evolution of the issuers who, for their part, are influenced by the general situation of the world economy and by political and economic circumstances within the respective countries. Interest rate risk: variations or fluctuations in the interest rate affect the price of fixed income assets. Increases in the interest rate have a negative effect on the price of these assets, while interest-rate reductions lead to an increase in their price. As a general rule, the price of fixedincome securities is more sensitive to interest rate fluctuations the longer the period remaining to the moment they mature. Exchange rate risk: this is the risk that arises as a consequence of an investment in assets denominated in currencies other than the currency of reference for the participation, which must assume the risk deriving from exchange-rate fluctuations. Credit risk: this is the risk of the issuer of the fixed income assets not being able to pay the principal and the interest. The risk is greater when the sub-fund invests in securities with a low credit rating. Liquidity risk: this is the risk that arises when adverse market conditions affect the capacity to sell the assets due to a lack of buyers. The lack of liquidity may have a negative impact on the price of the assets. Counterparty risk: this is the risk of losses arising due to the incapacity of one of the parties with which the UCI or sub-fund has contracted some financial instrument to fulfil its obligations. It usually occurs in operations involving OTC derivatives. Operational risk: this is the risk of losses resulting from a lack of suitability, or errors in the internal processes, the actions of personnel or systems, or else as a consequence of external events. Risk linked to derivative instruments: the UCI or the sub-fund may only carry out operations with derivative instruments in those cases where the investment policy allows them to be used. The use of these instruments could result in additional risks because of leverage, and they are especially sensitive to variations in the price of the underlying asset and the losses in the value of the portfolio could be multiplied. The use of derivative financial instruments, even if it is for hedging purposes, can also carry some risks owing to the possibility of there being an imperfect correlation between the movement of the underlying asset of the derivative and that of the assets being hedged. Similarly, operations with derivative financial instruments that have not been contracted in organized markets also carry risks, such as that of the counterparty failing to fulfil its obligations, because of the non-existence of a clearing house that intervenes between the parties to ensure that the operations are concluded successfully. The net asset value of the participations could be affected as a consequence of all the risks described above, and it could show a certain volatility depending on the risk profile. Specific risks: The investment in fixed income assets is subject to interest rate risk although these funds fundamentally invest in short-term assets and this reduces their sensitivity to interest rate fluctuations. The issuers of the securities in which the fund invests have a suitable credit rating, and consequently there is usually a moderate credit risk. 4

5 On the other hand, the fund may invest in issuers that belong to emerging markets (undeveloped countries) and this may carry an added risk for the portfolio. As a consequence of all these risks, the net asset value of the participations could be affected and show a certain volatility in accordance with the risk profile shown below. Risk profile (scale from 1 to 7): the following level of risk is calculated on the basis of the calculation methodology proposed by the Committee of European Securities Regulators (CESR) to obtain the volatility level using historical data of the UCI, or failing that, a portfolio that represents it. Lower risk Higher risk Potentially lower profitability Potentially higher profitability Risk categories are calculated using historical data and they might not give a reliable indication of the future risk profile of the UCI. The risk level may vary over time and it is not an objective and neither is it guaranteed. In this regard, it should be pointed out, for example, that when the economic situation is very unfavourable and there are situations of stress in the markets, or if an issuer registers a credit event or default, the risk indicator could reach its maximum level. You are advised to carefully read the investment risk section. Valuation of assets: assets are valued at their fair value. As a general rule, the fair value of an asset is the market value according to the official listing price at the close of the market on which it is listed. Assets that are not listed on regulated markets are valued at their estimated realizable value or their probable trade value. The market value of participations in undertakings for collective investment is determined by the latest net asset value available on the last working day, at the moment of the valuation of the UCI and/or of the sub-fund. Real-estate assets are generally valued in accordance with appraisals carried out by independent experts of recognized prestige. Interest on fixed income assets accumulates according to the accounting principle of accrual and the resulting collection rights are recorded in accounts that appear in the current assets of the balance sheet under the heading Portfolio of financial investments up to the day that they are actually collected. 7. Economic information Tax regime: the following descriptions are not intended and do not seek to offer advice or/and recommendations in fiscal matters, nor do they represent an inventory of the fiscal effects that the subscription, ownership and redemption of securities might have. Investors are reminded that the information contained in this section is simply a general summary of the Andorran tax system applicable to the investment in accordance with the current Andorran laws that were in force at the time that this prospectus was prepared. For this reason, investors are advised to analyse their own personal situation with a tax advisor. Taxation at the level of the participants of the UCI or sub-fund will depend on where they are fiscally resident: -Participants who are fiscally resident in the Principality of Andorra The applicable legislation is the General Indirect Tax Act 11/2012 of 21 June. The tax rate levied on the provision of banking and financial services is 9.5%. The applicable legislation is the Personal Income Tax Act 5/2014 of 24 April. Materialized capital gains or losses and profits distributed by the fund will be subject to the tax system in force at any given time. -Participants who are not fiscally resident in the Principality of Andorra: Participants who do not reside in the Principality of Andorra are subject to the provisions of the tax legislation currently in force in the country in which they are fiscally resident. It is the responsibility of participants to keep abreast of any possible legislative changes in fiscal matters. Fees: the fees that the Management Company and the depositary may receive are outlined below. o Annual management fee: this fee is borne by the UCI and calculated on equity and it is accumulated daily through creditor accounts. On the date that this prospectus was updated, the current and maximum fees were as follows: o Current fee: 0.30% per annum (class R) and 0.15% per annum (class E) 5

6 o Maximum fee: 1.50% per annum o Performance fee: borne by the UCI and calculated on its performance. On the date that this prospectus was updated, the current and maximum fees were as follows: o Current fee: 0% (no performance fee is envisaged) o Maximum fee: 0%. o Annual depositary fee: borne by the UCI, it is calculated on equity and accumulated daily through creditor accounts. On the date that this prospectus was updated, the current and maximum fees were as follows: o Current fee: 0.20% per annum (class R) and 0.10% per annum (class E) o Maximum fee: 0.40% per annum o Subscription fee: borne by the investor, it is calculated on the value of the participations acquired at the moment the subscription is made. On the date that this prospectus was updated, the current and maximum fees were as follows: o Current fee: 0% o Maximum fee: 5.00% o Redemption fee: borne by the investor, it is calculated on the value of the participations sold at the moment the redemption is made. On the date that this prospectus was updated, the current and maximum fees were as follows: o Current fee: 0% o Maximum fee: 5.00% The minimum fees will always be equal to or higher than 0%. Fees may vary within the described maximum limits according to the judgement and discretion of the Management Company and the depositary. If new fees are established or if current fees are increased, this will be made public in the legally established manner and provided that there is a redemption fee, investors will have the corresponding right of withdrawal without any deduction of a redemption fee or similar expense. The Management Company may apply higher redemption fees within the limit set as the maximum fee, to those participants who redeem their participations before 5 days after their subscription and provided that speculative behaviour is observed in this operation. The management and depositary fees will generally be settled on a quarterly basis, and failing that, at least once a year. If the UCI or sub-fund has to pay a performance fee, the management company has devised a system for allocating performance fees which prevents a participant from having to pay fees when the net asset value of its participations is less than a value that has been previously obtained and for which it has had to pay performance fees. To this end, the UCI or sub-fund will only have to pay the performance fee in those reporting periods in which the net asset value is higher than any other value that has been previously achieved in reporting periods in which a performance fee has been paid. Other possible expenses or fees: in addition to the fees described in the previous section, the UCI or the sub-fund may have to directly or indirectly bear other expenses, such as those corresponding to taxes, tributes, brokerage fees for the intermediation and liquidation of financial instruments, establishment costs, legal costs, auditing expenses, as well as any other costs that may be necessary for it to function and which are contemplated by the law. 8. Commercial information Minimum initial investment: one participation. Initial value of the participation: 100 euros Frequency of the net asset value: Daily. Place where the net asset value is published: The Management Company will communicate the net asset value of the sub-fund to the promoter, Vall Banc SAU, on a daily basis, so that the net asset value can be consulted at its offices or by any other means that the promoter may make available, and it may also be consulted at the registered offices of the Management Company. The net asset value can also be consulted at the website of the promoterwww.vallbanc.ad. Cut-off time: 1 pm. The applicable net asset value is that corresponding to the day on which the subscription or the redemption is requested, provided that this request is made before the cut-off time. Orders received after the cut-off time shall be considered as having been received the following working day for contracting. The net asset value applicable to the subscriptions and redemptions of the D day is always calculated on the following working day (D+1). 6

7 Form of acquiring and selling participations: orders to subscribe and redeem shares are given through Vall Banc SAU (promoter) or any other contracting or commercialization system used by the entity. Valuation of the participations: The net asset value is the result of dividing the value of the assets of the UCI or sub-fund, where appropriate, by the number of participations on the date of the calculation. For subscription and redemption purposes, participations are valued according to the net asset value on the day that they are requested, provided that this is a working day according to the calendar published by the Association of Andorran Banks (ABA). In any case, the net asset value applied will be the same as subscriptions and redemptions requested at the same time. The net asset value applicable is that corresponding to the day that the subscription or redemption is requested provided that this application is made before the cut-off time. Orders received after the cut-off time shall be considered as having been received on the following working day for contracting. The Management Company may apply an additional liquidation period in those cases where a redemption greater than 5% of the assets is requested. Similarly, it may establish a provisional suspension on subscriptions and/or redemptions if there are exceptional circumstances and provided that the aim of the suspension is to protect the legitimate interests of the investors. Form of passing from one sub-fund to another, and the fees that apply: in cases where investors wish to make transfers between sub-funds, in those case where the UCI has sub-funds, no entry fee will be applied provided that these sub-funds share the same investment policy. Otherwise, the fee resulting from the difference between the subscription fee of the entry sub-fund and that of the exit sub-fund will be applied as long this is a positive amount. Date for closing the annual accounts: 31 December of each year. Other: Persons who are U.S. nationals and/or persons whose country of residence is the United States of America or any other territory subject to the jurisdiction of that country, may not invest in this product. 9. Additional information Place where the prospectus and quarterly reports can be consulted: the regulations, complete prospectus, simplified prospectus, quarterly reports and audited public financial statements can be requested free of charge at the offices of Vall Banc or at the registered offices of the Management Company. Supplementary information: further information can be obtained at any of the offices of Vall Banc, on its web site ( by sending an to the address vallbanc@vallbanc.ad or by calling the Vall Banc customers services telephone Dissolution and liquidation: the UCI or sub-fund will be dissolved, and the liquidation period opened, Upon expiry of the period set out in its regulations. By decision of the Management Company and the depositary. By decision of the management entity or the depositary, if either of these entities has ceased to carry out its functions in accordance with the precepts established by Law, and no management entity or depositary has been designated to replace them. When the equity of the fund is negative. When the assets of the UCI do not reach the minimum required by Law. Because of the non-existence of participants or other causes that the regulations may establish. Because of the non-fulfilment of other legal precepts. The INAF and the participants must be notified immediately of any agreements for the dissolution/liquidation through the normal publicity and advertising procedures. External advice: No external advisors or consultancy companies participate in the management of the UCI or sub-fund. o Identity and business name of the consultant/advisor: does not apply. 7