Rich Asian investors are losing billions on fixed coupon notes

A popular investment among Asia’s wealthy in the years of rock-bottom interest rates has been upended in the recent market rout, leaving investors facing losses estimated to be in the billions of dollars. Structured products called fixed coupon notes attracted scores of private banking clients in Hong Kong and Singapore in recent years, according to half a dozen bankers and advisers who spoke to Bloomberg. Promised regular coupons even in turbulent times, some put 20 per cent or more of their portfolios into the instruments, they said. One catch: the principal was tied to swings in assets like stocks, and losses could mount quickly during deep market declines. In a bull market, investors...