Fund update on suspension of trading of JPM Emerging Europe Equity

AVAILABLE IN OUR DEFINED FUND RANGE PRODUCTS

The Fund can be found in our defined fund range products Oracle, Paragon, Quantum and RSP (including Malaysia variants).

SUMMARY OF THE CHANGES

Further to our notification in May 2022 regarding the removal of suspended funds from affected plans,  JP Morgan has advised that, as the conflict with Russia and Ukraine has lasted longer than expected, they will be restructuring the Suspended Fund to allow the non-Russian related assets in the fund to continue to be traded.

How JPMorgan will restructure the fund

On the basis that the Suspended Fund cannot continue normal operations and is expected to have liquidity issues persisting for a longer timeframe, the board of directors of the Suspended Fund has decided on the next step to protect shareholders. The assets of the Suspended Fund will be split into two funds: 

• the Suspended Fund and
• a newly created fund, JPMorgan Funds - Emerging Europe Equity II Fund (the “Receiving Fund”) (referred to as the “Split”)

The liquid assets (assets that can continue to be traded once removed from the Suspended Fund) will be transferred to the Receiving Fund in order to resume normal dealing, whilst the illiquid assets (those assets that cannot be traded) will remain hosted within the Suspended Fund. The Split is scheduled to take place on 17 February 2023 and the Receiving Fund will be available for normal trading from 20 February 2023.

What happens now with the Suspended Fund and Receiving Fund

The Suspended Fund was removed from affected plans in May 2022, in order to continue normal operations such as taking withdrawals or switching other actively trading funds held. 

However, sometime shortly after JPMorgan completes the Split, we will add the newly created Receiving Fund containing the liquid assets, into affected plans. This will be called JPM Emerging Europe Equity II A Acc EUR under ISIN code LU2549520950.  

Following the Split, plan owners will continue to hold the same number of shares in the Suspended Fund and will receive the same number of shares in the equivalent share class of the Receiving Fund. The price of the Receiving Fund will reflect the net asset value of the liquid assets transferred from the Suspended Fund.

The Receiving fund will be an actively trading fund to which plan owners will be able to have full access, along with any other actively trading funds held. 

The illiquid assets will remain in the Suspended Fund and will remain suspended until such time as they become tradeable and can be sold by JPMorgan. As such, affected plan owners will remain invested, on a pro-rata basis, in the Suspended Fund.  Please note that the Suspended Fund will still not be visible on the affected plans, as this remains suspended to all trading activity.

Key differences in investment policy between the Suspended Fund and the Receiving Fund

The Suspended Fund invests in companies in European emerging market countries including Russia, whereas the Receiving Fund will invest in companies in European emerging market countries excluding Russia, Belarus and any countries added to recognised lists of sanctions maintained by the Office of Foreign Assets Control, United Nations, the EU and His Majesty's Treasury.

For full details of the objective changes, please refer to the Sample Plan Owner Letter opposite.

Regular premium allocation

At the point of suspension of the Suspended Fund, if plan owners were allocating any regular premium payment into the Suspended Fund, this was redirected into the Aberdeen Standard Liquidity (Lux) EUR A2 Acc fund (the “Default Fund”). We will not be redirecting that allocation back into the new Receiving Fund. 

Unless we receive an alternative premium redirection instruction, any allocation will continue to be directed into the Default Fund. 

Affected plan owners do not need to take any action with regard to this notification.  The changes will happen automatically within affected plans. You may want to discuss the options with your financial adviser before deciding on any changes.

AVAILABLE IN OUR OPEN-ARCHITECTURE PRODUCTS

The Fund features in our open-architecture products and will be subject to changes detailed in the JPM Notification opposite.

For more information regarding JP Morgan funds visit: www.jpmorganassetmanagement.lu