Change in distribution policy of the underlying funds of M57 Barings Global Bond (USD) and P87 Barings Global Bond (EUR)
03 March 2021
We have been notified by Barings International Fund Managers (Ireland) Limited (the “Manager”) of the following upcoming change to the distribution policy of the underlying funds of the above named mirror funds. These changes will come into effect from 30 April 2021 (the “Effective Date”).
The Manager has confirmed the below, which has been extracted from the shareholder circular of the underlying funds of the above named mirror funds:
“Distributions in respect of the distributing Units of the Fund may currently be paid out of surplus net income and / or any capital gains less realised and unrealised capital losses. With effect from the Effective Date (as defined below), the Fund may also pay distributions out of capital and/or gross investment income while charging some or all fees and expenses out of capital attributable to those Units. The change in distribution policy is to provide more flexibility to the Fund in respect of distributing dividends.
Payment of distributions out of (i) capital and/or (ii) gross investment income while charging some or all fees and expenses out of capital attributable to relevant Units (which also means effectively paying dividends out of capital) and/or (iii) unrealised capital gains (which also means effectively paying distributions out of capital) amount to a return or withdrawal of part of an investor’s original investment or from any capital gains attributable to that original investment. Any distributions of dividends out of capital or effectively out of capital may result in an immediate reduction of the Fund’s Net Asset Value per Unit.
As a result of this change, it is possible that the Fund may distribute a higher portion of dividends out of capital and/or effectively out of capital than its current practice and therefore more susceptible to the risks associated with payment of dividend out of capital and/or effectively out of capital. The risk disclosures relating to distribution out of capital in the Hong Kong Offering Documents will be enhanced. Please refer to the Hong Kong Offering Documents for further details regarding the change of distribution policy and the relevant risk factors.”
Should you have any questions regarding these changes, please contact International Funds & Investments.