Citigroup prices deal on iShares FTSE/Xinhua China 25; Barclays sells reverse convertibles

By LLuvia Mares

New York, Dec. 19 ? Leading news in structured products, Citigroup Funding Inc. priced a $13.92 million issue of 0% Premium Mandatory Callable Equity-linked Securities (Pacers) due June 26, 2009 linked to the iShares FTSE/Xinhua China 25 index fund.

The securities will be called at increasing premiums if the fund closes at or above its initial level during the three-trading-day periods beginning June 20, 2008, Dec. 19, 2008 and June 19, 2009. The redemption amount will be par of $10.00 plus $0.50 if the securities are called during the first call period, par plus $1.00 if called during the second period and par plus $1.50 if called during the third period.

If the securities are not called, the payout at maturity will be par unless the fund closes at or below the trigger level - 55% of the initial level - during the life of the securities, in which case investors will receive a number of shares of the fund equal to par divided by the initial level or a cash amount equal to the final level multiplied by the product of $10.00 divided by the initial level.

Citigroup Global Markets Inc. is the underwriter.

Barclays prices reverse convertibles

Elsewhere, Barclays Bank plc priced $1.5 million of 19% reverse convertible notes due June 20, 2008 linked to Wells Fargo & Co. stock, according to a 424B2 filing with the Securities and Exchange Commission.

The payout at maturity will be par in cash unless Wells Fargo stock falls below the protection price of $24.26, 80% of the initial price of $30.32, during the life of the notes and finishes below the initial price in which case the payout will be 32.98153 shares of Wells Fargo stock.

Barclays Capital is the agent.

Morgan Stanley to price AIG-linked PLUS notes

In another deal, Morgan Stanley plans to price 0% Performance Leveraged Upside Securities (PLUS) due January 2011 linked to the Dow Jones - AIG Commodity index, according to an FWP filing with the Securities and Exchange Commission.

If the final index level is at least the initial level, the payout at maturity will be par plus 140% to 160% of any increase in the index. The exact percentage will be determined at pricing.

Otherwise, the payout will be par minus the initial index decline.

Pricing and settlement are to be determined.

Morgan Stanley & Co. Inc. is the agent.

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