Legal & General and Barclays and launch Defined Return Plan 1
03 April 2013
Barclays and Legal & General have announced the launch of the Legal & General Defined Return Plan 1 ("the Plan"), which opens for investment on 8 April 2013.
The Plan will be the first product in a collaborative series of investments offering investors efficient access to Barclays' investment expertise and Legal & General's plan management and administration capabilities in a single bundled offering.
Richard Henry, Director, Barclays said: "Blending Barclays' investment expertise with Legal & General's highly regarded proposition allows us to offer another way for advisers to access the products they need in the way that best suits them.
We are focused on delivering client-centric solutions and we appreciate that where in some cases unbundled investments are appropriate, in others a bundled route may be the most suitable. This approach allows advisers to choose optimally based on their own requirements."
James Harrington, Head of Structured Solutions, Legal & General Savings said: "We are naturally extremely pleased to be working with Barclays to launch an attractive proposition for investors via the IFA market.
Where advisers are looking for plans rather than the unbundled solutions from Barclays, they will recognise that the strength of the plan manager and administrator is extremely important.
Legal & General has been active in the structured product sector since 1995 and we are confident that few providers in the market have our credentials for delivering product for the adviser population. We are looking forward to working together."
Paula Hughes, Account Director at Legal & General said: "Legal & General is one of the top financial services providers in the UK and is well placed to deliver high quality customer propositions for Barclays Bank.
We have been working with Barclays since 2001 providing mortgage protection in their retail network. This latest initiative extends our relationship with Barclays to include investments for IFAs, which is a core area of expertise for our Legal & General Savings business.
The inclusion of structured investments in the partnership makes sense for both IFAs and their customers, and supports Barclays' position as a major financial services provider. This meets the need in the market for bundled products and by offering a choice for clients reinforces our common goal of putting customers at the centre of what we both do."
The Plan offers repayment of capital plus a defined return as long as the level of the FTSE 100 Index on the second anniversary, or subsequent anniversaries is equal to or above the starting level, taken on 19 June 2013.
The Plan will last a maximum of six years but if the defined return payment feature activates the Plan will close early on the second, third, fourth or fifth anniversaries.
The maturity date is 19 June 2019.
Notes to editorsLegal & General Defined Return Plan 1:
The new Plan offers repayment of capital plus a defined return as long as the level of the FTSE 100 Index on the second anniversary, or subsequent anniversaries is equal to or above the starting level, taken on 19 June 2013. The Plan will last a maximum of six years but if the defined return payment feature activates the Plan will close early on the second, third, fourth or fifth anniversaries. The maturity date is 19 June 2019.
See table below for potential returns:
Potential defined return payment
|End of year||1||2||3||4||5||6 (19 June 2019)|
|FTSE 100 is unchanged or higher||N/A||14%||21%||28%||35%||42%|
Capital is not protected with this Plan. Between 50% and 100% of the original investment will be lost if the final level of the FTSE 100 has fallen by more than 50% from the starting level at the end of the six year term. The original capital invested will be reduced by 1% for each 1% fall in the Index.
So, if the FTSE 100 Index is 60% less than its starting level, investors will receive 60% less than they invested.
The plan is hedged by securities issued by Barclays Bank Plc, rated A+ by Standard & Poor's, and managed and administered by Legal & General.
The minimum investment is £3,000. Investors can invest up to £11,520 in a stocks and shares ISA for the 2013/2014 tax year.
There is no maximum for ISA transfers. The last date for ISA transfers is 17 May to allow time for the completion of the transfer before the offer close date. The closing date for all other applications is 31 May 2013.
This plan offers Facilitated Adviser Charging (FAC).
Full details of FAC arrangements and product key features are available on the Legal & General dedicated adviser website landgstructuredproducts.com.
Advisers can also contact Solutions First on 0370 050 0614 (Lines are open from 9am to 5pm Monday to Friday. We may record and monitor calls. Call charges will vary). Or email email@example.com
The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions.
1. The contract start date is 19 June 2013 and the end of the fixed term is 19 June 2019.
2. This plan is not suitable for customers who may need to access their money before the end of the six year term or who may be seeking a definite return, and are not prepared to accept the risk that they may lose some or all of their investment.
3. The growth of the FTSE 100 Index will be measured using the initial level of the Index at the close of business on the start date and the final level of the Index on each applicable anniversary.
4. At the end of six years, if the defined return payment has not been triggered, the return will be as follows:
a) if the FTSE 100 Index has fallen by