NEW YORK -- (Business Wire)
Barclays Bank PLC announced today the automatic redemption of its iPath®
Long Enhanced S&P 500 VIX Mid-Term Futures™ Exchange Traded Note (II)
(ticker: VZZB) (the “ETNs”). The ETNs are being redeemed as the result
of an automatic termination event occurring on October 5, 2012, the
automatic termination date. As described in the prospectus, an automatic
termination event occurs when the intraday indicative note value of the
ETNs on any valuation date is equal to or less than the automatic
termination level of $10.00. Details of the automatic termination event
Automatic Termination Date:
October 5, 2012
Time of Automatic Termination Event:
09:30 a.m. EST
Automatic Termination Level:
Holders of the ETNs on the automatic redemption date, which is the fifth
business day following the automatic termination date, will receive a
cash payment equal to the automatic redemption value.
Automatic Redemption Date:
October 15, 2012
Automatic Redemption Value:
Closing indicative value of the ETNs on the automatic termination
date (which will not be greater than $10.00 for each ETN, and will
not be less than $0 per ETN).
For more information regarding the automatic termination event,
including how the automatic redemption value is determined, see the
prospectus relating to the ETNs under the heading “Specific Terms of the
ETNs—Automatic Termination Event.” The prospectus relating to the ETNs
can be found on EDGAR, the SEC website, at: www.sec.gov.
The prospectus is also available on the product website at www.iPathETN.com.
Barclays moves, lends, invests and protects money for customers and
clients worldwide. With over 300 years of history and expertise in
banking, we operate in over 50 countries and employ over 140,000 people.
We provide large corporate, government and institutional clients with a
full spectrum of solutions to their strategic advisory, financing and
risk management needs. Our clients also benefit from access to the
breadth of expertise across Barclays. We’re one of the largest financial
services providers in the world, and are also engaged in retail banking,
credit cards, corporate banking, and wealth and investment management.
Barclays offers premier investment banking products and services to its
clients through Barclays Bank PLC.
For more information, visit www.barclays.com
For further information about the iPath ETNs go to: http://www.iPathETN.com
An investment in the iPath ETNs described herein (the “ETNs”) involves
risks. Selected risks are summarized here, but we urge you to read the
more detailed explanation of risks described under “Risk Factors” in the
applicable prospectus supplement and pricing supplement.
You May Lose Some or All of Your Principal: The ETNs are exposed
to any decrease in the level of the underlying index between the
inception date and the applicable valuation date. Additionally, if the
level of the underlying index is insufficient to offset the negative
effect of the investor fee and other applicable costs, you will lose
some or all of your investment at maturity or upon redemption, even if
the value of such index has increased. Because the ETNs are subject to
an investor fee and any other applicable costs, the return on the ETNs
will always be lower than the total return on a direct investment in the
index components. The ETNs are riskier than ordinary unsecured debt
securities and have no principal protection.
Credit of Barclays Bank PLC: The ETNs are unsecured debt
obligations of the issuer, Barclays Bank PLC, and are not, either
directly or indirectly, an obligation of or guaranteed by any third
party. Any payment to be made on the ETNs, including any payment at
maturity or upon redemption, depends on the ability of Barclays Bank PLC
to satisfy its obligations as they come due. As a result, the actual and
perceived creditworthiness of Barclays Bank PLC will affect the market
value, if any, of the ETNs prior to maturity or redemption. In addition,
in the event Barclays Bank PLC were to default on its obligations, you
may not receive any amounts owed to you under the terms of the ETNs.
Automatic Redemption: If specified in the applicable prospectus,
Barclays Bank PLC will automatically redeem a series of ETNs (in whole
only, but not in part) at the specified automatic redemption value if,
on any valuation date prior to or on the final valuation date, the
intraday indicative note value of the ETNs becomes less than or equal to
the applicable level specified in the prospectus.
The Performance of the Underlying Indices are Unpredictable: An
investment in the ETNs is subject to risks associated with fluctuations,
particularly a decline, in the performance of the underlying index.
Because the performance of such index is linked to futures contracts on
the CBOE® Volatility Index (the “VIX Index”), the performance
of the underlying index will depend on many factors including, the level
of the S&P 500® Index, the prices of options on the S&P
500® Index, and the level of the VIX Index which may change
unpredictably, affecting the value of futures contracts on the VIX Index
and, consequently, the level of the underlying index. Additional factors
that may contribute to fluctuations in the level of such index include
prevailing market prices and forward volatility levels of the U.S. stock
markets and the equity securities included in the S&P 500®
Index, the prevailing market prices of options on the VIX Index,
relevant futures contracts on the VIX Index, or any other financial
instruments related to the S&P 500® Index and the VIX
Index, interest rates, supply and demand in the listed and
over-the-counter equity derivative markets as well as hedging activities
in the equity-linked structured product markets.
Your ETNs Are Not Linked to the VIX Index: The value of your ETNs
will be linked to the value of the underlying index, and your ability to
benefit from any rise or fall in the level of the VIX Index is limited.
The index underlying your ETNs is based upon holding a rolling long
position in futures on the VIX Index. These futures will not necessarily
track the performance of the VIX Index. Your ETNs may not benefit from
increases in the level of the VIX Index because such increases will not
necessarily cause the level of VIX Index futures to rise. Accordingly, a
hypothetical investment that was linked directly to the VIX Index could
generate a higher return than your ETNs.
Leverage Risk: Because an investment in the ETNs is leveraged,
changes in the level of the underlying index will have a greater impact
on the payout on the ETNs than on a payout on securities that are not so
leveraged. In particular, any decrease in the level of the underlying
index will result in a significantly greater decrease in the payment at
maturity or upon redemption, and an investor will suffer losses on an
investment in the ETNs substantially greater than an investor would if
the ETNs did not contain a leverage component.
Market and Volatility Risk: The market value of the ETNs may be
influenced by many unpredictable factors and may fluctuate between the
date you purchase them and the maturity date or redemption date. You may
also sustain a significant loss if you sell your ETNs in the secondary
market. Factors that may influence the market value of the ETNs include
prevailing market prices of the U.S. stock markets, the index components
included in the underlying index, and prevailing market prices of
options on such index or any other financial instruments related to such
index; and supply and demand for the ETNs, including economic,
financial, political, regulatory, geographical or judicial events that
affect the level of such index or other financial instruments related to
A Trading Market for the ETNs May Not Develop: Although the ETNs
are listed on NYSE Arca, a trading market for the ETNs may not develop
and the liquidity of the ETNs may be limited, as we are not required to
maintain any listing of the ETNs.
No Interest Payments from the ETNs: You may not receive any
interest payments on the ETNs.
Restrictions on the Minimum Number of ETNs and Date Restrictions for
Redemptions: You must redeem at least 25,000 ETNs of the same series
at one time in order to exercise your right to redeem your ETNs on any
redemption date. You may only redeem your ETNs on a redemption date if
we receive a notice of redemption from you by certain dates and times as
set forth in the pricing supplement.
Uncertain Tax Treatment: Significant aspects of the tax treatment
of the ETNs are uncertain. You should consult your own tax advisor about
your own tax situation.
Barclays Bank PLC has filed a registration statement (including a
prospectus) with the SEC for the offering to which this communication
relates. Before you invest, you should read the prospectus and other
documents Barclays Bank PLC has filed with the SEC for more complete
information about the issuer and this offering. You may get these
documents for free by visiting www.iPathETN.com
or EDGAR on the SEC website at www.sec.gov.
Alternatively, Barclays Bank PLC will arrange for Barclays Capital Inc.
to send you the prospectus if you request it by calling toll-free
1-877-764-7284, or you may request a copy from any other dealer
participating in the offering.
BlackRock Investments, LLC, assists in the promotion of the iPath ETNs.
The ETNs may be sold throughout the day on the exchange through any
brokerage account. There are restrictions on the minimum number of ETNs
you may redeem directly with the issuer as specified in the applicable
prospectus. Commissions may apply and there are tax consequences in the
event of sale, redemption or maturity of ETNs. Sales in the secondary
market may result in significant losses.
”Standard & Poor’s®”, “S&P 500®”, “S&P®”,
“S&P 500® Total Return”, “S&P 500 VIX Short-Term
Futures™” and “S&P 500 VIX Mid-Term Futures™” are trademarks of Standard
& Poor’s Financial Services, LLC (“S&P”) and Dow Jones®
is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow
Jones”). These trademarks have been licensed for use by S&P Dow Jones
Indices LLC and its affiliates and sublicensed for certain purposes by
Barclays Bank PLC. “CBOE®” and “VIX®” are
trademarks of the Chicago Board Options Exchange, Incorporated (“CBOE”)
and have been licensed for use by S&P Dow Jones Indices LLC and
sublicensed for certain purposes by Barclays Bank PLC. S&P Dow Jones
Indices LLC, Dow Jones, S&P, or any of their respective subsidiaries or
affiliates (collectively, “S&P Dow Jones Indices”) and CBOE make no
representation, condition or warranty, express or implied, to the owners
of the ETNs or to any member of the public regarding the advisability of
investing in securities generally or in the ETNs or in the ability of
the indices to track market performance.
© 2012 Barclays Bank PLC. All rights reserved. iPath, iPath ETNs and the
iPath logo are registered trademarks of Barclays Bank PLC. All other
trademarks, servicemarks or registered trademarks are the property, and
used with the permission, of their respective owners.
NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE
Barclays Bank PLC
+1 212 412 1413
Source: Barclays Bank PLC
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