Credit Agricole Sells Its Largest Note Tied to Yen in 13 Years

Credit Agricole SA (ACA) sold its biggest structured note denominated in Japanese yen since at least 1999.

The French bank issued 7.74 billion yen ($99.3 million) of the securities, its third offering tied to the Japanese currency this year, on Sept. 27. The three-year notes pay fixed coupons twice a year of 0.34 percent plus a potential bonus that depends on the U.S. dollar-yen exchange rate, according to data compiled by Bloomberg. The data exclude securities where the amount of principal returned can vary and go back to 1999.

Noteholders receive an additional 0.11 percent should the exchange rate rise above an initial level, indicating a weakening yen, on twice-yearly observation dates. The initial rate is the average for the currency on Sept. 27, Sept. 28 and Oct. 1 minus 5 yen, Bloomberg data show.

Charline Coue, a Paris-based spokeswoman at France’s third- largest bank by market value, declined to comment on the notes.

The yen declined 1.45 percent this year against the dollar, making it the worst performer among the Group of 10 currencies tracked by Bloomberg. It advanced 0.05 percent to 78.03 against the greenback at 08.45 a.m. in London.

Previously, Credit Agricole’s biggest structured note in the Japanese currency was 5 billion yen of 30-year securities sold on May 11, 2006, with a coupon tied to the Nikkei 225, Bloomberg data show.

Structured notes are securities created by banks, which package debt with derivatives to offer customized bets to investors while earning fees and raising money. Derivatives are contracts whose value is derived from stocks, bonds, currencies and commodities.

To contact the reporter on this story: Alastair Marsh in London at amarsh25@bloomberg.net

To contact the editor responsible for this story: Paul Armstrong at parmstrong10@bloomberg.net

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