Pinnacle Notes Series 9 and 10

Investors who bought the mini-bonds issued by U.S. investment bank Lehman Brothers find their investment worthless now. Though this would be the end since the world leaders are coughing out cash from central bank to stable the market, but now the investors of Pinnacle Notes Series 9 and 10 may face the same faith.

On Friday, investors of Pinnacle received the crushing news that their investments will probably be wiped out, losing their principal. The two notes are part of the Pinnacle Notes Series of credit-linked notes, issued by Pinnacle Performance and arranged by Morgan Stanley Asia.

It has emerged that the notes were linked to some of the biggest names to be battered by the global crisis, including US mortgage giants Freddie Mac and Fannie Mae and two banks in Iceland, which is virtually bankrupt as a nation.

MAS has asked Morgan Stanley Asia to ensure that all affected investors are contacted and informed of the early redemption of these notes immediately. Morgan Stanley Asia had inform MAS that they are in the process of finalising the terms for the appointment of an international accounting firm to assess the early redemption process for the Pinnacle Series 9 and 10 notes.

The total issue size of the Pinnacle Notes Series 9 and 10 was S$26 million, sold to about 700 retail investors through five distributors: DMG & Partners Securities, Hong Leong Finance, Kim Eng Securities, OCBC Securities and UOB Kay Hian.