Barclays launches multi-currency exchange offers for tier 1 securities

By Toni Weeks

San Luis Obispo, Calif., May 15 - Barclays plc and Barclays Bank plc has launched offers to holders of some tier 1 securities to exchange their securities for new tier 1 securities.

According to a company filing with the London Stock Exchange, the exchange offers will accelerate the transition of the group's capital structure, contribute to its leverage ratio and target and manage interest costs associated with legacy non-CRD IV-compliant securities.

The companies are launching a sterling exchange offer, euro exchange offer and dollar exchange offer, each one subject to the condition that enough existing securities are tendered such that a minimum principal amount of the corresponding new securities are issued.

The sterling exchange offer is subject to a minimum issue size of at least £150 million; the euro exchange offer is subject to the condition that at least €300 million of new euro securities will be issued; and the dollar exchange offer is subject to the condition that at least $300 million of new dollar securities will be issued.

In the sterling exchange offer, the existing securities will be exchanged for new sterling securities with an initial interest rate of 7% and a reset sterling interest margin of 5.084%. The securities will be callable beginning Sept. 15, 2019 and have a conversion price of £1.65.

In the euro offer, the existing securities will be exchanged for new euro securities with an initial interest rate of 6.5% and a reset euro interest margin of 5.875%. The securities will be callable beginning Sept. 15, 2019 and will have a conversion price of €2.02.

In the dollar offers, existing securities will be exchanged for new dollar securities with an initial interest rate of 6.625% and a reset dollar interest margin of 5.022%. The securities will be callable beginning Sept. 15, 2019 and will have a conversion price of $2.77.

The securities descriptions, amount outstanding and exchange prices are noted in the table below.

The exchange offers expire at 11:59 p.m. ET on June 12. Holders may withdraw their tenders before the expiration date.

Tender results will be announced on June 13, with settlement to occur June 17. Book-entry interests will be issued in minimum denominations of £200,000, €200,000 and $200,000, as applicable, and in integral multiples of £1,000, €1,000 and $1,000, as applicable. Payment of any fractional securities will be made in cash.

The dollar exchange agent is Global Bondholder Services Corp. (866 470-4500 attn: corporate actions or info@gbsc-usa.com). The sterling and euro exchange agent is Lucid Issuer Services Ltd. (44 20 7704 0880 attn: Thomas Choquet or Yves Theis or Barclays@lucid-is.com). The sole global coordinator and lead dealer manager is Barclays Capital Inc. (In the United States: 1 800 438-3242 or 212 528 7581 attn: liability management group or us.lm@barclays.com; in Europe: 44 0 20 3134 8515 attn: liability management group of eu.lm@barclays.com).

Securities Amount outstanding

Sterling exchange offer Price per £1,000 principal amount

6% callable perpetual core tier 1 notes £90,501,000 £1,040

5.3304% step-up callable perpetual reserve capital instruments £81,481,000 £960

6.3688% step-up callable perpetual reserve capital instruments £94,703,000 £1,050

6% non-cumulative callable preference shares £750 million £1,030

Euro exchange offer Price per €1,000 principal amount

4.75% non-cumulative callable preference shares €1.4 billion €1,000

Dollar exchange offer Price per $1,000 principal amount

6.86% callable perpetual core tier 1 notes $681,013,000 $1,135

5.926% step-up callable perpetual reserve capital instruments $533,064,000 $1,090

7.434% step-up callable perpetual reserve capital instruments $346,565,000 $1,155

6.278% series 1 non-cumulative callable dollar preference shares,

evidenced by series 1 American Depositary Shares $1 billion $1,060

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