Societe Generale's Inora Life Launches First Offshore Fund

Philip Morton, Investors Offshore.com

01 March 2001

Created last month by Societe Generale, Dublin-based company Inora Life is about to launch its first Nasdaq 100 product on the European market. Called the Offshore Generation Bond-Accumulator Growth Fund, it will act as a platform to provide unit-linked offshore life bonds to investors.

The bonds can be purchased through brokers and private banks based in the European markets of the UK, Spain, Italy, France, Germany, Luxembourg and the Netherlands with a customised product range for each country. Inora Life says it can guarantee 100% capital protection and a 20% minimum return but explains: 'the Accumulator Growth Fund Series 1 has a term of 5 years 6 months and 2 weeks, and should be held for the full duration for the maturity terms to apply. The returns from the Accumulator Growth Fund Series 1 are directly linked to assets invested with a leading AA-rated financial institution. In the event that this financial institution is unable to meet its obligations the benefits may be less.'

A minimum investment of £6,000 is required and the fund attains its 20% minimum return by analysing the percentage shifts in the Nasdaq index every six months and cappping each period at 10%. Dean Marriot, head of UK liason for Inora Life says: 'We're aiming at a risk-averse market with a product linked to an index that has been volatile in the recent past. Because of this, we designed the fund to offer high returns but also a high degree of protection.' At the end of the fourth investment year and if the returns are greater than 20% the minimum return will be upped - this higher return can not be reduced even if the Nasdaq 100 falls in value over the next 18 months.

Being based outside the UK is a distinct advantage for Inora Life in that all growth incurred by the bonds will not be taxed by the UK government providing the money remains in an offshore location. This has potentially lucrative benefits when planning for inheritance tax and pensions. Mr Marriot explained: 'The use of offshore investments can be extremely valuable for tax planning and the Offshore Growth Bond easily slots into an investor's portfolio alongside other tax-efficient onshore vehicles such as Isas.'

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