The DBS label was used to sell the product. Who would want to buy from Constellation?

Minibond = Constellation
Zircon, Beryl = Zensis

The difference is, in the case of DBS’ structure, the investors were buying a Note called DBS High Note 5 issued by DBS bank itself. This Note is explicitly linked to something called “Reference Notes” (i.e. the Credit Linked Note issued by Constellation).

In the case of Lehman, the investors there were simply buying a Note issued by Minibond Ltd.

I guess it is a case of which one is worst – being rip off by an ang moh bank or one of your own ?!

Just to check, isn’t the Minibond structure similar to HN?

With the underlying securities issued by notes from another SPV (zircon, beryl, etc).

This must be the most complicated CLN ever created. The question then is why such complications ? Why not just sell a Note issued by Constellation (like the Lehman’s structure, a note issued by Minibonds Ltd).

I believe they put the DBS label “on top” of the entire structure to make it more enticing & credible. An unsuspected customer would say to himself or herself ……hmmm………. “a DBS Note pays me 2% more than depo rate over 5yr sounds like my money is in safe hands. Nothing too much to worry about ”.

I think the senior management there knows DBS had done a dirty on their customers. Instead of using the RMs as “silence of the lambs”. The entire management should do the honorable thing and resign ! The implicit trust between a bank and its customers is breached, never mind the legal mumble jumble.