Barclays Global Carbon Index Total ReturnTM is the underlying
index to the iPath® Global Carbon ETN (Ticker: GRN)
On October 23, 2017, Barclays Bank PLC as index sponsor (the
“Index Sponsor”) of the Barclays Global Carbon Index Total ReturnTM
(the “Original Index”), announced that the Original Index will be
retired effective October 27, 2017. The iPath® Global Carbon ETN
(the “ETNs”) are currently linked to the performance of the
Original Index. The Original Index is being replaced with a
successor index, the Barclays Global Carbon II TR USD Index (the
“Successor Index”) effective after the close of October 27, 2017.
Pursuant to the terms of the ETNs, Barclays Bank PLC as calculation
agent on the ETNs has approved the Successor Index as a successor
index for the ETNs following the discontinuation of publication of
the Original Index.
October 27, 2017 will be last valuation date on which the
closing indicative value of the ETNs will be calculated by
reference to the Original Index. Starting from October 30, 2017,
the ETNs will be linked to the performance of the Successor Index
and the closing indicative value and redemption value of the ETNs
will be calculated by reference to the Successor Index.
Both the Original Index and the Successor Index have the
objective of providing exposure to the global price of carbon and
track the return of futures contracts on a carbon emissions credit
that trade on the Intercontinental Exchange (“ICE”). The
differences between existing and successor indices include those
summarized below:
- The Successor Index determines the
weightings of the Index Components on an annual basis without the
use of the Index Committee that was used by the Original Index to
approve the rules, composition and methodology of the Original
Index. The method for determining the composition and weighting of
the Successor Index is intended to codify the process undertaken by
the index sponsor to determine the composition and weighting of the
Original Index.
- The futures contracts eligible for
inclusion as Index Components in the Successor Index include
futures contracts on carbon emissions credits from only two
mechanisms: EUAs and CERs (each traded on ICE). Although the Index
Components of the Original Index historically included only futures
contracts relating to these two mechanisms, the Original Index
provided that the index sponsor, in consultation with the Index
Committee, could identify additional mechanisms to which the
Original Index could provide exposure.
The closing value of the Successor Index will be calculated and
published on each trading day by Bloomberg L.P. or a successor via
the facilities of the Consolidated Tape Association under the
ticker symbol “BXIIGC2T”. The closing value of the Original Index
has been previously published under the ticker symbol
“BXIIGCUT”.
We intend to treat the replacement of the Original Index with
the Successor Index under the terms of the ETNs as not triggering a
deemed taxable exchange of the ETNs for U.S. federal income tax
purposes. However, there is no authority directly on point, and the
Internal Revenue Service could conceivably assert that the index
replacement should trigger a deemed taxable exchange of the ETNs
for U.S. federal income tax purposes. In such a case, U.S. holders
of the ETNs would generally be required to recognize gain (if any)
or—subject to the potential application of the wash sale rules—loss
(if any) when the Original Index is replaced with the Successor
Index under the terms of the ETNs. U.S. holders of ETNs should
consult their tax advisors regarding the tax consequences to them
of the replacement of the Original Index with the Successor Index
under the terms of the ETNs.
The ETNs are listed on the NYSE Arca stock exchange under the
ticker symbol GRN. An investment in the ETNs involves
significant risks, including possible loss of principal, and may
not be suitable for all investors. The ETNs are riskier than
ordinary unsecured debt securities and have no principal
protection. The ETNs are speculative and may exhibit high
volatility. The ETNs are also subject to certain investor fees,
which will have a negative effect on the value of the ETNs.
For further information, please contact the Barclays ETN desk at
1-212-528-7990.
The prospectus for the ETNs to which this communication relates
can be found at: http://www.ipathetn.com/grnprospectus
Selected Risk Considerations
An investment in any ETNs linked to the iPath® Global Carbon
ETNs (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 index level between the inception
date and the applicable valuation date. 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.
Carbon Market Risk: Trading in futures contracts on
carbon emissions commodities, including trading in the index
components, is speculative and can be extremely volatile. The
commodity futures markets are subject to temporary distortions or
other disruptions due to various factors, including the lack of
liquidity in the markets, the participation of speculators and
government regulation and intervention. Market prices of the index
components may fluctuate rapidly based on numerous factors
including but not limited to changes in supply and demand, domestic
and foreign political or government actions and technological
developments. These factors could adversely affect the value of the
underlying index and, therefore, the value of your ETNs. Cap &
trade mechanisms have arisen primarily due to relative
international consensus on the correlation between the rise in
greenhouse gas emissions and the onset of global warming.
Accordingly, changes in regulation and enforcement of cap &
trade mechanisms as a result of changes in international consensus
can adversely affect market behavior and the value 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, 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.
No Interest Payments: The ETNs will not pay out any
periodic interest payments
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.
Restrictions on the Minimum Number of ETNs and Date
Restrictions for Redemptions: You must redeem at least 50,000
ETNs 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.
The ETNs may be sold throughout the day on the exchange through
any brokerage account. Commissions may apply and there are tax
consequences in the event of sale, redemption or maturity of
ETNs.
©2017 Barclays Bank PLC. All rights reserved. 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
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Barclays is a transatlantic consumer, corporate and
investment bank offering products and services across personal,
corporate and investment banking, credit cards and wealth
management, with a strong presence in our two home markets of the
UK and the US. With over 325 years of history and expertise in
banking, Barclays operates in over 40 countries and employs
approximately 85,000 people. Barclays moves, lends, invests and
protects money for customers and clients worldwide.
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version on businesswire.com: http://www.businesswire.com/news/home/20171026005846/en/
BarclaysAndrew Smith, +1 212 412
7521andrew.x.smith@barclays.com
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