The UK bank has conceded its crown as the largest issuer in US to Goldman Sachs in 2021 despite a 27% increase year-on-year.
Barclays’ structured products sales volume in the US market reached US$12.71 billion while the issuance climbed to 2,549 from 2,070 in 2021, SRP data shows.
The UK bank lost its place to Goldman Sachs which issued 3,569 structured products sold at US$12.87 billion taking the top on the SRP league table and Morgan Stanley, which collected US$12.85 billion in 2021.
Barclays started 2021 with a strong momentum in its sales volume which amounted to US$3.4 billion and US$3.7 billion in Q1 and Q2, respectively. The slowdown materialised in the second half of the year with the volume decreasing to US$2.7 billion in Q3 and Q4.
In terms of underlying assets, the Russell 2000 index which appeared in 1,615 products became the most favoured choice by the UK bank in 2021, with S&P 500 falling to the second place in the pecking order. Next in line were the Nasdaq 100 (821 products) and the Dow Jones Industrial Average Index (345 products).
The number of Tesla-linked products issued by Barclays also surged to 155 from 26, making the EV company stocks the fifth popular pick for the UK bank in 2021. Tesla was followed by the Eurostoxx 50 index and the SPDR S&P Regional Banking ETF, which were tied to 112 and 53 products, respectively.
Europe
Barclays launched a total of 146 non-flow structured products across the European market in 2021 with concentrations in UK (79 products) and Russia (44 products), an increase from the 101 products marketed in 2020. The sales volume in UK climbed from €54m to €181m YoY.
No issuance was recorded in Austria, Switzerland and The Netherlands where a total of nine products were launched in 2020.
In the UK, the products were offered through individual savings account (ISA) tracking the performance of the FTSE 100 (78 products) and the Solactive Climate Change Europe BTI PR Index (one product). In the meantime, there were 34 structured bonds and 10 structured certificates issued in Russia.
Among the 15 distributors across Europe, MB Structured Investments and Sberbank CIB stood out by accounting for 78 and 34 of the structured products issued by Barclays, respectively. Next in line were Aton (10 products) and Strivo (nine products), also from Russia.
Apac
The UK bank remained an active player in the Japanese Uridashi market appearing in 45 structured products which sold at JPY109.3 billion in 2021 as a derivatives manufacturer. The sales volume represented a 2.1% increase YoY.
Forty-two of these products were issued by Barclays Bank, two by Svensk Exportkredit and one by Kommuninvest i Sverige.
The structured products were distributed by 13 different banks and securities houses led by 82 Securities (five products/JPY44.6 billion), Shinsei Securities (nine products/JPY20 billion) and Shizugin TM Securities (six products/JPY16.4 billion).
From a payoff perspective, the autocallable reverse convertible dominated the issuance alongside worst-of option structures.
The most featured underlyings during the period were the S&P 500 and Nikkei 225 followed by the JPY/USD currency pair.
In South Korea, the UK bank was the hedge provider for 29 equity-linked securities (ELS) issued by NH Investment & Securities (21 products/KRW73 billion), KB Securities (two products/KRW820m) and Shihan Investment (five products/KRW1.52 billion). These were all public offerings linked to a total of 17 underlying names featuring shares such as Netflix and Advanced Micro Devices.
Green structured notes (GSN)
In its 2021 annual report, Barclays highlighted the new GSN programme which was rolled out as a partnership between equities and treasury to expand green transactions.
The GSN combines a derivative style payoff (equity-linked to green indices) with the proceeds of issuance being used to support eligible assets as defined in the Barclays Green Issuance Framework.
The proceeds of the notes are allocated to the financing or re-financing of eligible green activities such as renewable energy, energy efficiency and sustainable transportation loans and contribute to the bank’s net zero goals as well as providing £100 billion of green financing by 2030, as SRP reported in September.
‘The indices utilised in the GSN have been selected in accordance with the Barclays Green Index Selection Principles,’ stated the bank in the report.
‘The main benefit of the GSN is the ability to offer investors a differentiated green investment opportunity whereby both the embedded derivative (on the equity-linked underlying indices) and use of proceeds of the issuance meet environmental objectives.’
Earnings
The bank headed by the recently appointed chief executive C.S. Venkatakrishnan (pictured) has reported a stable total income of £21.9 billion in 2021 compared with the prior two years.
Barclays UK and Barclays International contributed £6.6 billion and £15.3 billion in 2021, respectively.
The international arm’s37% increase in investment banking income, or £1 billion, was offset by a mild decline in global markets income at £1.2 billion while corporate banking and consumer, cards and payments segments delivered stable income at £3.3 billion and £2.3 billion, respectively.
By region, UK and Americas remained the main profit centres representing 51.1% and 32.9% of the total income, followed by Europe and Asia Pacific.
Click here to view Barclays plc’s 2021 annual report.