Barclays prices large slate of reverse convertibles; Rabo plans 28.4% notes linked to InterOil

By Sheri Kasprzak

New York, May 29 - Barclays Bank plc got back to work after the three-day weekend in a big way on Tuesday, revealing terms on no less than 79 reverse convertibles.

"Basically it is just getting back to business after the long weekend," said one market insider. "There's a bit of a backlog there."

"With reverse convertibles, there's so much demand, that if you do miss a day, you have this huge load of things waiting to price the next day," said another market source. "It's hardly surprising there are so many pricing today."

Among the notable offerings were $8 million in 17.5% notes linked to Advanced Micro Devices, Inc. and two deals linked to General Motors Corp.

Note terms

The $8 million in AMD-linked notes have an 80% knock-in level and a six-month term.

The notes pay par at maturity unless the stock falls below the knock-in level during the life of the notes and ends below the $14.88 initial stock price.

If that should occur, the notes pay a number of shares equal to $1,000 divided by the initial share price.

AMD's stock traded between $13.18 - the closing stock price on May 8 - and $15.59 - the closing stock price on May 18, in the month of May.

In one of the GM-linked offerings, Barclays sold $4 million in 13.25% notes with a one-year term.

The notes have a 70% knock-in level and also pay par at maturity unless the knock-in level is breeched during the term of the notes and the stock finishes below the initial share price - $30.47.

In the other offering, the investment bank priced $3 million in 17% notes linked to GM. Those notes have an 80% knock-in price and a six-month term.

The notes pay par at maturity unless the stock falls below the initial share price - also $30.47 - during the life of the notes and ends below the initial share price. Should that happen, the notes pay a number of shares equal to $1,000 divided by the initial share price.

GM's stock has had its share of ups and downs this month, trading between $28.49 on May 10 and $31.97 on May 15.

Other Barclays deals

Elsewhere at Barclays, the investment bank priced $6 million in 13.4% notes linked to Freeport-McMoRan Inc. and $6 million in reverse convertibles linked to Corning Inc.

The Freeport-McMoRan notes have a six-month term and an 80% protection price.

The notes pay par at maturity unless the stock falls below the knock-in level during the life of the notes and ends below the initial share price of $72.29.

Freeport's stock has made advances throughout the month of May, trading in a range between $67.36 on May 1 and $75.84 on Tuesday.

The Corning notes, which have an 11.5% coupon and an 80% knock-in level, have the same payout terms. The initial share price Corning is $23.98.

Barclays' Stoxx-linked notes

In other news, Barclays priced $13.72 million in zero-coupon buffered return enhanced notes linked to Dow Jones Euro Stoxx 50 index.

The one-year notes pay twice any positive return on the index up to a 15% cap.

The notes are protected up to a 10% decline. Investors will lose 1.1111% of their investment for every 1% beyond 10% the index drops.

The Dow Jones Euro Stoxx 50 index had closed around 4,420 a month ago. The index now trades around 4,480 after dropping below 4,370 in late April.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.