Barclays Bank PLC (“Barclays”) announced an investor guidance
notification today regarding the iPath® US Treasury 10-year Bear
ETN (Ticker: DTYS)(“DTYS ETNs”), iPath® US Treasury Long Bond Bear
ETN (Ticker: DLBS)(“DLBS ETNs”) and Barclays Inverse US Treasury
Composite ETN (Ticker: TAPR)(“TAPR ETNs”). The DTYS ETNs, DLBS ETNs
and TAPR ETNs are collectively referred to herein as the “ETNs.”
Each of the ETNs are listed on the CBOE BZX Exchange (the “CBOE”).
The indices underlying the ETNs (collectively, the “Indices”) are
as follows:
ETN Name
ETN Ticker
Underlying Index Name
Index Ticker
iPath US Treasury 10-year Bear ETN
DTYS
Barclays 10Y US Treasury Futures Targeted
Exposure IndexTM
BXIITETY
iPath US Treasury Long Bond Bear ETN
DLBS
Barclays Long Bond US Treasury Futures
Targeted Exposure Index™
BXIITEUS
Barclays Inverse US Treasury Composite
ETN
TAPR
Barclays Inverse US Treasury Futures
Composite Index™
BXIIITAG
The listing rules of Cboe provide that ETNs may be subject to
delisting for a number of reasons, including if an event has
occurred or condition exists which in the opinion of Cboe makes
further dealings on Cboe inadvisable. Based on the conditions
outlined in the paragraphs below, Barclays expects that Cboe may
commence delisting proceedings and the suspension of trading for
one or more of the ETNs in the near future. If any of the ETNs are
delisted, such ETNs may trade, if at all, on an over-the-counter
basis, the secondary market for such ETNs may experience a
significant drop in liquidity, and holders of such ETNs may not be
able to trade or sell their ETNs easily.
The ETNs have experienced a persistent and rapid decline since
February 4, 2020. Based on the performance of the Indices and other
factors that are included in the calculations of the ETNs’ daily
redemption value, there is a potential for the daily redemption
value to drop to $0 in the near future.
On March 3, 2020, the daily redemption value of the ETNs hit an
all-time low of:
- $3.6395 per ETN with respect to the DTYS ETN;
- $1.9643 per ETN with respect to the DLBS ETN; and
- $7.3444 per ETN with respect to the TAPR ETN.
On March 2, 2020, Barclays previously announced the temporary
suspension of further issuances and sales from the inventory of the
ETNs. As described in that press release and also in the pricing
supplement relating to the ETNs, the limitations on issuance and
sale implemented could from time to time cause an imbalance of
supply and demand in the secondary market for the ETNs, which may
cause the ETNs to trade at a premium or discount in relation to
their indicative value.
Recently, a material premium has developed in the trading price
of the ETNs on the CBOE in relation to their intraday indicative
value. From February 3, 2020 to March 3, 2020:
- the closing indicative value of the DTYS ETNs decreased by
approximately 59%, from $8.8163 to $3.6395 per ETN, while the
closing price of the DTYS ETNs on the CBOE decreased by only
approximately 50% from $8.8472 to $4.3901 per ETN;
- the closing indicative value of the DLBS ETNs decreased by
approximately 70%, from $6.6482 to $1.9643 per ETN, while the
closing price of the DLBS ETNs on the CBOE decreased by only
approximately 52% from $6.7006 to $3.2400 per ETN; and
- the closing indicative value of the TAPR ETNs decreased by
approximately 29%, from $10.4149 to $7.3444 per ETN, while the
closing price of the TAPR ETNs on the CBOE decreased by only
approximately 28% from $10.3200 to $7.4597 per ETN
The closing price of the ETNs on the CBOE as of March 3, 2020,
reflected a:
- 20.6% premium to the corresponding closing indicative value
with respect to the DTYS ETNs;
- 64.9% premium to the corresponding closing indicative value
with respect to the DLBS ETNs; and
- 1.6% premium to the corresponding closing indicative value with
respect to the TAPR ETNs.
Investors should exercise extreme caution before purchasing
or selling ETNs at a market price that reflects a premium over the
intraday indicative value or daily redemption value, as the case
may be. The intraday indicative value of the ETNs is intended
to provide investors with an approximation of the effect that
changes in the level of the Indices during the current trading day
would have on the daily redemption value of the ETNs from the
previous day. The intraday indicative value of the ETNs is
calculated and published with a frequency of at least every 15
seconds throughout the trading day. The daily redemption value (or
closing indicative value) is the closing value of the ETNs
calculated by us on a daily basis and is used to determine the
payment at maturity or upon early redemption. The secondary market
for the ETNs has been volatile and unpredictable, and investors
should not assume that the ETNs will continue to trade at a premium
in relation to their intraday indicative value. As a result, if
investors purchase the ETNs at a price which reflects a premium
over the intraday indicative value or daily redemption value, as
the case may be, they may experience a significant loss if they
sell the ETNs at a time when such premium is no longer present, if
they redeem the ETNs at the daily redemption value or if they hold
the ETNs until maturity.
For more information on what a premium in the market prices
represents, please refer to the iPath website under “About ETNs.”
Investors are also encouraged to refer to the prospectus relating
to the respective ETNs for risk factors relating to the market
value of the ETNs, including the risks associated with a premium in
market prices on the CBOE.
The ETN holders’ option to require Barclays to repurchase the
ETNs will not be affected and will remain even if the CBOE takes
action in the future to delist the ETNs. On February 19, 2020,
Barclays had announced previously the waiver of the minimum early
redemption size of 20,000 ETNs for DTYS and DLBS. Please refer to
the press release dated February 19, 2020 for more details.
The obligation of Barclays to accept any early redemption of
ETNs is subject to the procedures set forth in the section
“Specific Terms of the ETNs—Early Redemption Procedures” in the
prospectus relating to the ETNs. These procedures include
delivering a notice of redemption and signed confirmation to
Barclays prior to the relevant valuation date within the time
frames set forth in the prospectus and instructing the DTC
custodian at which the ETNs are held to book and settle a delivery
vs. payment trade with respect to the ETNs.
An investment in iPath ETNs involves significant risks and
may not be suitable for all investors. The ETNs are riskier than
ordinary unsecured debt securities and have no principal
protection. For more information on risks associated with the ETNs,
please see "Selected Risk Considerations" below and the risk
factors included in the relevant prospectus.
The prospectus for the ETNs to which this communication relates
can be found at:
http://ipathetn.com/dtysprospectus
http://ipathetn.com/dlbsprospectus
http://ipathetn.com/taprprospectus
Barclays is the issuer of iPath® ETNs and Barclays Capital Inc.
is the Issuer’s agent in the distribution. Please contact Barclays
for further questions:
Financial advisors:
- Directly contact Barclays at etndesk@barclays.com or
1-212-528-7990 to obtain further information
Individual investors:
- Instruct your broker/advisor/custodian to email us at
etndesk@barclays.com or to call us at: 1-212-528-7990
You may call in together with your broker/advisor/custodian or
have them speak to us on your behalf.
About Barclays
Barclays is a British universal bank. We are diversified by
business, by different types of customer and client, and geography.
Our businesses include consumer banking and payments operations
around the world, as well as a top-tier, full service, global
corporate and investment bank, all of which are supported by our
service company which provides technology, operations and
functional services across the Group. For further information about
Barclays, please visit our website www.barclays.com.
Selected Risk Considerations
An investment in the iPath ETNs described herein 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 applicable 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 level has increased or decreased, as the case may be.
Because the ETNs are subject to an investor fee and 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.
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 or the U.S. Treasury market, 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 such index.
A Trading Market for the ETNs May Not Develop: Although
the ETNs are listed on a U.S. national securities exchange, 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: Except with respect to the
circumstances described above or as otherwise specified in the
applicable product prospectus, you must redeem at least the minimum
number of ETNs specified in the applicable product prospectus 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 product prospectus.
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.
The ETNs may be sold throughout the day on the CBOE 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.
© 2020 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
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200305005914/en/
Press: Danielle Popper +1 212 526 5963
Danielle.Popper@barclays.com
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