Skandia Protected Portfolio Investment / Keydata

Written by Skandia and re-produced by Aisa for information only.

You may have seen some media reports that have confirmed that Keydata Investment Services Limited (KISL) has been placed into administration on the grounds that it is insolvent. As Keydata plays a role within the Skandia Protected Portfolio Investment (PPI), which you may have recommended to clients in the past or may be considering recommending to clients now, we wanted to make you aware of the situation.

As explained in the Key Features Document for the PPI, Morgan Stanley & Co. International plc (MSIL) acts as plan manager and custodian for the PPI assets. In this role, MSIL holds the assets of the plan on investors' behalf in safe custody via a third-party nominee, which is Keydata Investment Product Nominees Ltd.

The assets are required to be held in a ring-fenced nominee account (separate from the assets of MSIL and KISL) in accordance with Financial Services Authority regulations and so should not form part of the administration process affecting KISL.

We are currently in discussions with MSIL about how the situation affects the tranche of the PPI that is maturing now, as well as applications that have been submitted for the tranche of the PPI that is currently open for investment. Full details of this will be communicated to relevant clients and their financial advisers as soon as possible.

For clients with holdings in any of the Royal Skandia PPI Life Funds, the position of KISL will not impact their investment because MSIL do not act as Plan Manager or Custodian for the Life Funds' assets.

Morgan Stanley will be writing to all investors in the PPI to update them on the situation once they have further information.

 
Graham Bentley
Head of Investment Marketing
Skandia UK

Checked by James Pearcy-Caldwell
Director

Dated June 2009 – valid for 6 months. AisaProfessional is a trading style of Aisa Direct Ltd, authorised and regulated by the FSA as Independent Financial Advisers. 1 Fordbrook Business Centre, Pewsey, SN9 5NU

Notes …

Please note that the opinions expressed in this letter must not be construed as statements of fact – you should carry out your own further research before coming to a decision and before taking any action.
The views in this letter represent the opinions of Aisa and should not be construed as a statement of fact. Further advice should be sought before actioning any investment or tax advice. The Financial Services Authority does not regulate opinions on the economic outlook, nor does it regulate some forms of tax advice or comment such as this.

* This newsletter has been prepared with all possible care to ensure its accuracy. It is based on our current understanding of legislation and HMRC practice. 
* Neither Aisa Direct Ltd nor any of its employees can accept responsibility for any errors or omissions. You should seek further professional advice prior to action.

This should not be deemed as individual advice and you should seek further information particular to your individual circumstances. For further information, contact AisaProfessional on (0845) 838 7279.