EFTA01737983.pdf

From: Shahzad Shahbaz To: Jeffrey E. <jeevacahon gmai .com> Subject: RE: Investment Structures Sent: Sunday, May 22, 2016 11:09:56 AM As requested; • List of Fixed Income Names # Bucket Reference Entity Type Weight Sy CDS Moody's S&P Fitch Spread 1 Sovereign Portuguese Republic Senior 5.00% 275 Sal BB+ BB+ 2 Federation of Malaysia Senior 5.00% 146 A3 A- A- 3 Autos General Motors Co Senior 5.00% 210 BBB- BBB- 4 Volkswagen AG Senior 5.00% 162 A3 888+ BBB+ 5 Commodity Petroleos Mexicanos Senior 5.00% 350 Baa3 BBB+ BBB+ Producer 6 Rio Tinto Ltd Senior 5.00% 175 Baal A- A- 7 BHP Billiton Ltd Senior 5.00% 158 A3 A A+ 8 ConocoPhillips Senior 5.00% 170 Baa2 A A- 9 Repsol SA Senior 5.00% 265 Baa2 BBB- BBB 10 Consumer Staples Tesco PLC Senior 5.00% 265 BB+ BB+ EU Financials Banco Bilbao Vizcaya 11 Subordinated 5.00% 265 Baa3 BBB+ (sub) Argentaria SA 12 Banco Santander SA Subordinated 5.00% 265 Baa2 BBB+ 13 Standard Chartered Bank Subordinated 5.00% 275 A3 A 14 Assicurazioni Generali SpA Subordinated 5.00% 240 Baa3 BBB4 15 Societe Generale SA Subordinated 5.00% 185 Baa3 A- 16 Royal Bank of Scotland Plc Subordinated 5.00% 255 Bat BBB 17 BNP Paribas SA Subordinated 5.00% 160 Baa2 A EFTA_R1_00025055 EFTA01737983  18 Credit Suisse Group AG Subordinated 5.00% 178 Baa3 A- 19 Barclays Bank Plc Subordinated 5.00% 250 Baa3 A- 20 HSBC Bank Plc Subordinated 5.00% 200 A2 A+ • Deutsche is good on fixed income. BNP on equities • Still waiting for the proposal on the first loss idea. My gut feeling is that they will take most of the return away. Will let you know. • We have made some selected direct investments in the new economy names; tech, bio etc. Not really investing in tech funds. From: jeffrey E. [[email protected]] Sent: Sunday, May 22, 2016 1:23 PM To: Shahzad Shahbaz Subject: Re: Investment Structures in your fixed income basket, which stocks did you choose. ? 2. which banks have you found , or person at bank that you think provides the best execution and flexibility. . 3. Sk Hamad said that one of the banks might take the first two stock loss? 4 Do you currently invest in Tech ? or tech funds? med tech, bio tech, cyber etc.? On Sun, May 22, 2016 at 6:20 AM, Shahzad Shahbaz cal > wrote: Jeffrey, Hope all is well. Further to your meeting, HE Sheikh Hamad asked me to send you a summary of the 2 investment structures. EQUITY PUT OPTIONSI • Put option on the worst performing stock in a basket • One year structure • Coupon guaranteed irrespective of performance of the stocks in the basket. • Put option strike at 70% of reference/spot EFTA_R1_00025056 EFTA01737984 • Payoff if required in stock at 70% strike • We identified 3 baskets based on stocks we are comfortable to own in a downside scenario at a 30% discount. • Basket 1; BHP Billiton, Bank of America, Shell, BNP Paribas • Basket2; Credit Suisse, General Motors, BASF, General Electric • Basket 3; Barclays, Adidas, Siemens, Santander • The coupon on the above baskets ranges between 8.5 — 9.5% without any leverage. • Obviously you can select any stock of your preference in the basket. Stocks with higher volatility and less correlation will generate a higher coupon for the basket. FIXED INCOMEi • We identified 20 investment grade names to place in a portfolio • Given the uncertainty in the energy, commodity and bank sectors we selected some of these names to maximize returns • S year structure • Exposure through 5 year CDS • Based on leverage we are able to generate double digit returns. • The risk to the return is margin calls on the leverage if the value of the portfolio declines due to spreads widening. • Principal risk is based on default in any of the credits in the portfolio which is limited to 5% per name. I hope the above is useful. Please let me know if you have any questions. Best Shahzad. EFTA_R1_00025057 EFTA01737985  please note The information contained in this communication is confidential, may be attorney-client privileged, may constitute inside information, and is intended only for the use of the addressee. It is the property of JEE Unauthorized use, disclosure or copying of this communication or any part thereof is strictly prohibited and may be unlawful. If you have received this communication in error, please notify us immediately by return e-mail or by e-mail to [email protected], and destroy this communication and all copies thereof, including all attachments. copyright -all rights reserved EFTA_R1_00025058 EFTA01737986