Societe Generale to price slate of reverse convertibles; Wells Fargo plans CD linked to commodities basket

By Sheri Kasprzak

New York, Dec. 5 - Societe Generale led structured products news Tuesday with a large slate of reverse convertible offerings linked to some familiar names.

The investment bank plans to price reverse convertibles linked to Qualcomm, Inc.; Whole Foods Markets, Inc.; Halliburton Co.; Intel Corp.; Apple Computer, Inc.; and Palm, Inc., among others.

The Qualcomm notes carry a 12% coupon, which is slightly higher than coupons associated with the tech company earlier this year. ABN Amro Bank NV priced $700,000 in nine-month 9.5% reverse exchangeables linked to Qualcomm in July and, in March, the same bank priced $1.55 million in 9% reverse exchangeables linked to the stock.

In July, ABN Amro priced $1.9 million in 12% knock-in reverse exchangeables linked to Qualcomm.

Whole Foods coupon a bit lower

SocGen also intends to price 10.75% reverse convertibles linked to Whole Foods and that coupon is somewhat lower than similar notes priced earlier this year.

In November, ABN Amro priced $4.75 million in 10.5% reverse exchangeables linked to the name and Bear Stearns Cos. is gearing up to price 14% reverse convertibles linked to the grocer. Barclays Bank plc also has an offering coming up linked to Whole Foods. That note will have an 11.75% coupon.

Tech name coupons smaller

Except for the notes linked to Palm, the coupons on the notes linked to tech names by SocGen Tuesday were slightly smaller.

SocGen plans to price 10.5% reverse convertibles linked to Apple. HSBC USA Inc. priced $4.095 million in 18% reverse convertibles in August linked to Apple and in October, Bear Stearns priced $1.35 million in 14% notes linked to the tech company. HSBC priced $628,000 in 12.5% notes linked to Apple in October as well.

The coupon on the notes SocGen plans to sell linked to Intel have relatively the same coupon as similar notes priced this year. Those notes have a 9% coupon. In October, HSBC priced $250,000 in 9% reverse convertibles linked to Intel and in September, Barclays priced $4 million in 9% notes linked to the tech stock. In August, Intel was linked to $295,000 in 11.5% notes priced by ABN Amro.

The Palm-linked notes have a similar coupon to deals priced earlier this year. That coupon is 14.5%. HSBC priced 20.25% reverse convertibles in September and Credit Suisse (USA), Inc. priced $647,000 in 13.5% reverse convertibles linked to Palm in August.

Wells Fargo's CD

Elsewhere in structured products news, Wells Fargo Bank NA is negotiating an offering of certificates of deposit linked to a basket of commodities. The offering comes on the heels of two other CDs announced earlier this week.

The basket includes equal weights of aluminum, copper, nickel and zinc.

The 4½ year CDs are set to price Dec. 22.

At maturity, investors will receive par plus a minimum interest amount of 50% of the deposit amount for a 9.43% annual percentage yield if the basket level is positive. Investors will receive at least par.

Earlier this week, HSBC announced it is planning to price Far East Opportunity point-to-point certificates of deposit through LaSalle Financial Services, Inc. Also, Rabobank NV plans to price a CD linked to indexes.

A market source said Monday that CDs are growing in popularity because investors are comfortable with the securities and there is a certain degree of familiarity with them.

JPMorgan prices index basket notes

Moving to emerging markets-related offerings, JPMorgan Chase & Co. priced $3.85 million in 0% buffered return enhanced notes linked to a basket of emerging markets indexes.

"It really does depend on the index and the country," said one market source of whether emerging markets still have some popularity.

"For a while there, yeah, I'd agree that investors were staying away, but it seems that may be a thing of the past. There does seem to be a lot of interest in Asian and Latin countries right now, so that may be where the breeze is blowing right now."

The basket connected to the JPMorgan offering includes the Korea Stock Price 200, MSCI Taiwan, Amex Hong Kong 30, FTSE/Xinhua China 25 and MSCI Singapore indexes.

The one-year notes pay par plus triple any positive return up to a 21.75% return at maturity.

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