UBS accelerates two series of ETNs linked to ISE High Income

By Marisa Wong

Los Angeles, March 19 – UBS Investment Bank announced the mandatory redemption of two series of monthly pay 2x leveraged exchange-traded access securities issued by UBS AG, London Branch linked to the ISE High Income index.

All of the outstanding Etracs Monthly Pay 2xLeveraged Closed-End Fund ETN due Dec. 10, 2043 (Cusip: 90270L 842, NYSE Arca: CEFL) and Etracs Monthly Pay 2xLeveraged Closed-End Fund ETN, series B, due Dec. 10, 2043 (Cusip: 90269A468, NYSE Arca: CEFZ) will be mandatorily redeemed on March 27.

The redemption was triggered by the respective indicative values of the securities falling below $5.00 on March 18, according to a press release.

The series A Etracs is one of the series of ETNs subject to the ongoing voluntary exchange offers that began on Dec. 9. As a result of the mandatory redemption of the series A and series B securities, the exchange offer for the series A note will be terminated effective as of March 18, according to the release.

Holders of the series A securities will no longer be able to participate in the exchange offer, and notes tendered between 5 p.m. ET on March 17 and 5 p.m. ET on March 18 will be promptly returned to holders and will not be exchanged for series B securities.

Series A notes tendered between 5 p.m. ET on March 3 and 4:59 p.m. ET on March 17, on the other hand, were accepted for exchange under the exchange offer, and the corresponding series B notes will be issued on March 19. Those series B notes are also subject to the mandatory redemption.

UBS is a financial services company based in Zurich.

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