Teng Chee Wai, Chief Executive Officer and Executive Director of HwangDBS IM commented, "The three underlying referenced credits (i.e. IOI Corp., Tenaga Nasional Bhd and Khazanah Nasional Bhd) of the Fund's structured product continued to meet their financial obligations as at 19 February 2010. And, since the StrIF I previous quarter’s income distribution, the yields and credit spreads of all the mentioned credits remained stable, reflecting the inherent quality of the underlying companies."

Teng also noted that the issuer of the Fund’s structured product investment, Deutsche Bank (Malaysia) Berhad ("Deutsche Bank"), continues to maintain its AA credit rating by domestic credit rating agencies. Operationally, Deutsche Bank continues to perform in line with market expectations. As such, HwangDBS IM is also confident that Deutsche Bank will continue to honour its obligations in respect of the Fund’s structured product investment. In terms of the global credit front, credit spreads continue to be on a tightening bias across both high grade and high yield segments towards end of last year due to market participants’ increasingly upbeat outlook for the global economy and improving risk appetite. However, volatility kicked-in beginning of 2010 on the back of China’s initial tightening policies in raising banks’ reserve ratio, as well as concerns over the fiscal health of the Greece government.

In conclusion, HwangDBS IM will continue to monitor the economic environment and credit markets in respect of their effect on the referenced underlying credits and the Issuer of the Fund's structured product investment. Barring any unforeseen circumstances, we remain confident on the credit worthiness of all the three underlying references and the Issuer over the remaining tenure of the Fund.