Pricing Supplement - E-1971 Black
CALCULATION OF REGISTRATION FEE
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Title of Each Class of Securities
Offered |
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Maximum Aggregate Offering Price |
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Amount of Registration
Fee(1) |
Medium-Term Notes, Series A |
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$2,600,000 |
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$102.18 |
(1) |
Calculated in accordance with Rule 457(r) of the Securities Act of 1933. |
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Pricing Supplement dated April 22, 2008 (To the Prospectus dated August 31, 2007 and the Prospectus Supplement dated September 4, 2007) |
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Filed Pursuant to Rule 424(b)(2) Registration No. 333-145845 |
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$2,600,000 100% Principal Protected Notes due March 02, 2009 Linked to the Performance of the Common Stock of General Motors Corporation Medium-Term Notes, Series A, No. E-1971 |
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Key Terms: |
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Terms used in this pricing supplement, but not defined herein, shall have the meanings ascribed to them in the prospectus supplement. |
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Issuer: |
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Barclays Bank PLC(Rated AA/Aa1) |
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Initial Valuation Date: |
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April 22, 2008 |
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Issue Date: |
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April 25, 2008 |
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Final Valuation Date: |
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February 25, 2009 |
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Maturity Date: |
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March 02, 2009* (resulting in a term to maturity of approximately 10 months) |
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Denominations: |
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Minimum denomination of $1,000, and integral multiples of $1,000 in excess thereof. |
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Interest: |
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We will not pay you interest during the term of the Notes. |
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Conditional Coupon: |
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20.00% |
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Linked Share |
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The common stock of General Motors Corporation (Bloomberg ticker symbol: GM) |
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Principal Protection Percentage: |
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100% |
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Range: |
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The range above, but not including, the lower barrier and below, but not including, the upper barrier, where: lower barrier is 15.38, the initial price multiplied by 75.00% upper barrier is 25.64, the initial price multiplied by 125.00% |
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Initial Price |
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20.51, the closing price of the linked share on the initial valuation date. |
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Final Price |
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The closing price of the linked share on the final valuation date. |
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Payment at Maturity: |
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If you hold your Notes to maturity, you will receive a cash payment determined as follows: if the
closing price of the linked share is within the range above the lower barrier and below the upper barrier at all times between the initial valuation date and the final valuation date, you will receive (a) the principal
amount of your Notes plus (b) the principal amount multiplied by the conditional coupon: $1,000 + ($1,000 x conditional coupon) if the closing price of the linked share is outside the range at
or below the lower barrier or at or above the upper barrier at any time between the initial valuation date and the final valuation date, you will receive a cash payment of $1,000 for each $1,000 principal amount Note. Your principal is only protected if you hold the Notes to
maturity. |
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Calculation Agent: |
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Barclays Bank PLC |
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Business Day: |
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New York |
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CUSIP/ISIN: |
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06738RWS1 and US06738RWS11 |
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The Notes are expected to carry the same rating as the Medium-Term Notes Program, Series A, which is rated AA by Standard & Poors, a division of the McGraw-Hill
Companies, Inc, and will be rated Aa1 by Moodys Investor Services, Inc. The rating is subject to downward revision, suspension or withdrawal at any time by the assigning rating organization. The rating (1) does not take into account
market risk or the performance-related risks of the investment (including, without limitation, the risks associated with the potential negative performance of any reference asset to which the Notes are linked), and (2) is not a recommendation
to buy, sell or hold securities. |
* |
Subject to postponement in the event of a market disruption event and as described under Reference AssetsEquity SecuritiesMarket Disruption Events Relating to
Notes with an Equity Security as the Reference Asset in the prospectus supplement. |
Investing in the Notes involves a number of
risks. See Risk Factors beginning on page S-3 of the prospectus supplement and
Selected Risk Considerations beginning on page PS-4 of this pricing supplement.
The Notes will not be listed on any
U.S. securities exchange or quotation system. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined that this pricing supplement is truthful or complete. Any
representation to the contrary is a criminal offense.
We may use this pricing supplement in the initial sale of Notes. In addition, Barclays Capital
Inc. or another of our affiliates may use this pricing supplement in market resale transactions in any Notes after their initial sale. Unless we or our agent informs you otherwise in the confirmation of sale, this pricing supplement is
being used in a market resale transaction.
The Notes constitute our direct, unconditional, unsecured and unsubordinated obligations and
are not deposit liabilities of Barclays Bank PLC and are not insured by the U.S. Federal Deposit Insurance Corporation or any other governmental agency of the United States, the United Kingdom or any other jurisdiction.
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Price to Public |
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Agents Commission |
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Proceeds to Barclays Bank PLC |
Per Note |
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100% |
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1.75% |
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98.25% |
Total |
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$2,600,000 |
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$45,500 |
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$2,554,500 |
ADDITIONAL TERMS SPECIFIC TO THE NOTES
You should read this pricing supplement together with the prospectus dated August 31, 2007, as supplemented by the prospectus supplement dated September 4, 2007 relating to our Medium-Term Notes, Series A,
of which these Notes are a part. This pricing supplement, together with the documents listed below, contains the terms of the Notes and supersedes all prior or contemporaneous oral statements as well as any other written materials including
preliminary or indicative pricing terms, correspondence, trade ideas, structures for implementation, sample structures, brochures or other educational materials of ours. You should carefully consider, among other things, the matters set forth in
Risk Factors in the prospectus supplement, as the Notes involve risks not associated with conventional debt securities. We urge you to consult your investment, legal, tax, accounting and other advisors before you invest in the Notes.
You may access these documents on the SEC website at www.sec.gov as follows (or if such address has changed, by reviewing our filings for the relevant
date on the SEC website):
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Prospectus supplement dated September 4, 2007 and prospectus dated August 31, 2007: |
http://www.sec.gov/Archives/edgar/data/312070/000119312507194615/d424b3.htm
Our SEC file number is 1-10257. As used in this pricing supplement, the Company, we, us, or our refers to Barclays Bank PLC.
Program Credit Rating
The Notes are issued under the Medium-Term
Notes Program, Series A (the Program). The Notes are expected to carry the rating of the Program, which is rated AA by Standard & Poors, a division of the McGraw-Hill Companies, Inc (S&P), and will be rated
Aa1 by Moodys Investor Services, Inc. (Moodys). An AA rating from S&P generally indicates that the issuers capacity to meet its financial commitment on the obligations arising from the Program is very strong. An Aa1
rating by Moodys indicates that the Program is currently judged by Moodys to be an obligation of high quality and is subject to very low credit risk. The credit rating is a statement of opinion and not a statement of fact and is subject
to downward revisions, suspension or withdrawal at any time by the assigning rating agency. The rating (1) does not take into account market risk or the performance-related risks of the investment (including, without limitation, the risks
associated with the potential negative performance of any reference asset to which the Notes are linked), and (2) is not a recommendation to buy, sell or hold securities.
Description of Hypothetical Example
The following hypothetical example is provided for illustration purposes only.
Assumptions in the example below are purely fictional and do not relate to the actual linked share. The hypothetical terms do not represent the terms of an actual Note. They have been created in order to illustrate the relationship between potential
returns on a Note and potential returns on the linked share. The example is hypothetical, and does not purport to be representative of every possible scenario concerning increases or decreases in the value of the hypothetical linked share. Investors
should not take the example below as an indication or assurance of the expected performance of the Notes or the linked share.
Below is a Table of
Hypothetical Values at Maturity, based on the assumptions outlined for a hypothetical linked share, which demonstrates the return that you would have earned from (i) an investment in the Notes compared to (ii) a direct investment in the
hypothetical linked share (prior to the deduction of any applicable brokerage fees or charges).
In the Table of Hypothetical Values at Maturity some
amounts are rounded and actual returns may be different. The following is a general description of how the hypothetical values in each table were determined.
Assumptions:
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Investor purchases $1,000 principal amount of Notes on the initial valuation date at the initial public offering price and holds the Notes to maturity.
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No market disruption events, anti-dilution adjustments, reorganization events or events of default occur during the term of the Notes. |
Initial price: $20.51
Lower Barrier:
$15.38
Upper Barrier: $25.64
Dividend yield: 4.87%
PS2
Table of Hypothetical Values at Maturity
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Linked Share Performance |
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Final Price of Linked Share |
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Total Return for Investment in the Notes |
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Total Return for Direct Investment in the
Linked Share |
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Closing Price Ever Outside Range |
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Closing Price Always Within Range |
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100% |
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$41.02 |
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0% |
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N/A |
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104.87% |
75% |
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$35.89 |
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0% |
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N/A |
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79.87% |
50% |
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$30.77 |
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0% |
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N/A |
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54.87% |
25% |
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$25.64 |
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0% |
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N/A |
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29.87% |
20% |
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$24.61 |
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0% |
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20.00% |
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24.87% |
15% |
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$23.59 |
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0% |
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20.00% |
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19.87% |
10% |
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$22.56 |
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0% |
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20.00% |
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14.87% |
5% |
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$21.54 |
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0% |
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20.00% |
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9.87% |
0% |
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$20.51 |
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0% |
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20.00% |
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4.87% |
-5% |
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$19.48 |
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0% |
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20.00% |
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-0.13% |
-10% |
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$18.46 |
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0% |
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20.00% |
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-5.13% |
-15% |
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$17.43 |
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0% |
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20.00% |
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-10.13% |
-20% |
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$16.41 |
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0% |
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20.00% |
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-15.13% |
-25% |
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$15.38 |
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0% |
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N/A |
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-20.13% |
-50% |
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$10.26 |
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0% |
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N/A |
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-45.13% |
-75% |
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$ 5.13 |
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0% |
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N/A |
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-70.13% |
-100% |
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$ 0.00 |
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0% |
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N/A |
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-95.13% |
Selected Purchase Considerations
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Market Disruption Events and AdjustmentsThe payment at maturity, the final valuation date and the closing price of the linked share are subject to
adjustment as described in the following sections of the prospectus supplement: |
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For a description of what constitutes a market disruption event as well as the consequences of that market disruption event, see Reference AssetsEquity
SecuritiesMarket Disruption Events Relating to Notes with an Equity Security as the Reference Asset; and |
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For a description of further adjustments that may affect the linked share, see Reference AssetsEquity SecuritiesShare Adjustments Relating to
Notes with an Equity Security as the Reference AssetAntidilution Adjustments. |
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Appreciation PotentialThe Notes provide the opportunity to enhance returns by entitling you to 20.00% conditional coupon paid at maturity in the event
that the closing price of the linked share is at all times within the range between the initial valuation date and the final valuation date, in addition to the principal amount of your Notes. |
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Preservation of Capital at MaturityYou will receive at least 100% of the principal amount of your Notes if you hold your Notes to
maturity, regardless of the performance of the linked share. Because the Notes are our senior unsecured obligations, payment of any amount at maturity is subject to our ability to pay our obligations as they become due.
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Certain U.S. Federal Income Tax Considerations The following section assumes that the description of the terms of the Notes in this pricing supplement
is materially correct. The discussion below supplements the discussion under Certain U.S. Federal Income Tax Considerations in the accompanying prospectus supplement and is only applicable to you if (i) you are a United States
holder (as defined in the accompanying prospectus supplement) and (ii) your taxable year does not end on a day that is between the final valuation date and the maturity date. |
NO STATUTORY, JUDICIAL OR ADMINISTRATIVE AUTHORITY DIRECTLY DISCUSSES HOW YOUR NOTES SHOULD CURRENTLY BE TREATED FOR UNITED STATES FEDERAL INCOME TAX
PURPOSES. AS A RESULT, CERTAIN ASPECTS OF THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF YOUR INVESTMENT IN THE NOTES ARE UNCERTAIN. ACCORDINGLY, WE URGE YOU TO CONSULT YOUR TAX ADVISOR AS TO THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
OF YOUR INVESTMENT IN THE NOTES AS WELL AS THE APPLICATION OF STATE, LOCAL AND OTHER TAX LAWS TO YOUR INVESTMENT IN THE NOTES.
Our special
tax counsel, Sullivan & Cromwell LLP, is of the opinion that the Notes will be treated as contingent short-term debt for United States federal income tax purposes. The terms of your Notes require you and us (in the absence of a change in
law or a regulatory, administrative or judicial ruling to the contrary) to treat your Notes for all tax purposes as a contingent short-term debt instrument subject to the rules discussed herein. In purchasing your Notes, you agree to these terms.
PS3
Initial Purchasers. If you are an initial purchaser of the Notes, upon the maturity of your Notes,
you should recognize ordinary income, if any, in an amount equal to the difference between the amount you receive with respect to your Notes at such time and the amount you paid for your Notes. Upon a sale or exchange of your Notes, it would be
reasonable for you to recognize short-term capital gain or loss in an amount equal to the difference between the amount you paid for your Notes and the amount received by you upon such sale or exchange, unless you sell or exchange your Notes between
the final valuation date and the maturity date, in which case it would be reasonable for you to treat any gain that you recognize as ordinary income and any loss that you recognize as a short-term capital loss. The deductibility of capital losses is
subject to limitations.
Secondary Purchasers. If you are a secondary purchaser of Notes, you should be treated in the same manner as
described above with respect to initial purchasers except that if you purchase your Notes at a discount from their principal amount (i) and hold them until maturity, it would be reasonable for you to treat any income you recognize as short-term
capital gain to the extent of the excess of the principal amount of your Notes over the amount you paid for your Notes and to treat any loss you recognize as short-term capital loss, or (ii) sell or exchange them between the final valuation
date and the maturity date, any gain that you recognize upon such sale or exchange should be treated as short-term capital gain to the extent that such gain does not exceed the difference between the principal amount of your Notes and the amount you
paid for your Notes.
Selected Risk Considerations
An investment in the Notes involves significant risks. Investing in the Notes is not equivalent to
investing directly in the linked share. These risks are explained in more detail in the Risk Factors section of the prospectus supplement, including the risk factors discussed under the following headings:
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Risk FactorsRisks Relating to All Notes; |
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Risk FactorsAdditional Risks Relating to Notes Which Pay No Interest; |
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Risk FactorsAdditional Risks Relating to Notes with Reference Assets That Are Equity Securities or Shares or Other Interests in Exchange-Traded Funds,
That Contain Equity Securities or Shares or Other Interests in Exchange-Traded Funds or That Are Based in Part on Equity Securities or Shares or Other Interests in Exchange-Traded Funds; and |
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Risk FactorsAdditional Risks Relating to Notes with a Barrier Percentage or a Barrier Level. |
In addition to the risks described above, you should consider the following:
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The Notes Might Not Pay More Than the Principal AmountYou may receive a lower payment at maturity than you would have received if you had invested in
the linked share. If the closing price of the linked share is outside the range on any day between the initial valuation date and the final valuation date, you will not receive a payment at maturity of more than the principal amount of your Notes.
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No InterestAs a holder of the Notes, you will not receive interest payments. |
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Certain Built-In Costs Are Likely to Adversely Affect the Value of the Notes Prior to MaturityWhile the payment at maturity described in this pricing
supplement is based on the full principal amount of your Notes, the original issue price of the Notes includes the agents commission and the cost of hedging our obligations under the Notes through one or more of our affiliates. As a result,
the price, if any, at which Barclays Capital Inc. and other affiliates of Barclays Bank PLC will be willing to purchase Notes from you in secondary market transactions will likely be lower than the original issue price, and any sale prior to the
maturity date could result in a substantial loss to you. The Notes are not designed to be short-term trading instruments. Accordingly, you should be able and willing to hold your Notes to maturity. |
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Lack of LiquidityThe Notes will not be listed on any securities exchange. Barclays Capital Inc. and other affiliates of Barclays Bank PLC intend to
offer to purchase the Notes in the secondary market but are not required to do so. Even if there is a secondary market, it may not provide enough liquidity to allow you to trade or sell the Notes easily. Because other dealers are not likely to make
a secondary market for the Notes, the price at which you may be able to trade your Notes is likely to depend on the price, if any, at which Barclays Capital Inc. and other affiliates of Barclays Bank PLC are willing to buy the Notes.
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PS4
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Potential ConflictsWe and our affiliates play a variety of roles in connection with the issuance of the Notes, including acting as calculation agent
and hedging our obligations under the Notes. In performing these duties, the economic interests of the calculation agent and other affiliates of ours are potentially adverse to your interests as an investor in the Notes.
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Many Economic and Market Factors Will Impact the Value of the NotesIn addition to the levels of the linked share on any day, the value of the Notes
will be affected by a number of economic and market factors that may either offset or magnify each other, including: |
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the expected demand or supply for linked share; |
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the time to maturity of the Notes; |
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interest and yield rates in the market generally; |
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a variety of economic, financial, political, regulatory or judicial events; and |
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our creditworthiness, including actual or anticipated downgrades in our credit ratings. |
Description of the Linked Share
According to publicly available
information, General Motors Corporation (the Company) is incorporated in 1916 under the laws of the State of Delaware. The Company is primarily engaged in the worldwide development, production, and marketing of cars, trucks, and parts.
The Company develops, manufactures, and markets its vehicles worldwide through its four automotive regions: GM North America, GM Europe, GM Latin America/Africa/Mid-East, and GM Asia Pacific. The Companys total worldwide car and truck
deliveries were 9.4 million, 9.1 million, and 9.2 million, for 2007, 2006, and 2005, respectively. Substantially all of the Companys cars, trucks, and parts are marketed through retail dealers in North America, and through
distributors and dealers outside of North America, the substantial majority of which are independently owned.
The linked shares SEC file number is
001-00043.
Historical Performance of the Linked Share
The following table sets forth the high and low intraday prices, as well as end-of-quarter closing prices, during the periods indicated below. We obtained the historical trading price information set forth below from Bloomberg, L.P.,
without independent verification.
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Quarter/Period Ending |
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Quarterly High |
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Quarterly Low |
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Quarterly Close |
June 28, 2002 |
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$ |
68.09 |
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$ |
50.77 |
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$ |
53.45 |
September 30, 2002 |
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$ |
54.08 |
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$ |
38.15 |
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$ |
38.90 |
December 31, 2002 |
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$ |
41.50 |
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$ |
30.83 |
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$ |
36.86 |
March 31, 2003 |
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$ |
41.12 |
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$ |
29.75 |
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$ |
33.62 |
June 30, 2003 |
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$ |
39.35 |
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$ |
32.84 |
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$ |
36.00 |
September 30, 2003 |
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$ |
43.23 |
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$ |
35.00 |
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$ |
40.93 |
December 31, 2003 |
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$ |
54.37 |
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$ |
40.04 |
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$ |
53.40 |
March 31, 2004 |
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$ |
55.55 |
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$ |
44.72 |
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$ |
47.10 |
June 30, 2004 |
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$ |
50.04 |
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$ |
42.88 |
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$ |
46.59 |
September 30, 2004 |
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$ |
46.93 |
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$ |
40.53 |
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$ |
42.48 |
December 31, 2004 |
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$ |
43.29 |
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$ |
36.90 |
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$ |
40.06 |
March 31, 2005 |
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$ |
40.77 |
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$ |
28.00 |
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$ |
29.39 |
June 30, 2005 |
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$ |
36.64 |
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$ |
24.68 |
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$ |
34.00 |
September 30, 2005 |
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$ |
37.69 |
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$ |
30.21 |
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$ |
30.61 |
December 30, 2005 |
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$ |
31.50 |
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$ |
18.34 |
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$ |
19.42 |
March 31, 2006 |
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$ |
24.59 |
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$ |
18.47 |
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$ |
21.27 |
June 30, 2006 |
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$ |
30.42 |
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$ |
19.00 |
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$ |
29.79 |
September 29, 2006 |
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$ |
33.62 |
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$ |
27.12 |
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$ |
33.26 |
December 29, 2006 |
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$ |
36.54 |
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$ |
28.49 |
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$ |
30.72 |
March 30, 2007 |
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$ |
37.24 |
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$ |
28.81 |
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$ |
30.64 |
June 29, 2007 |
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$ |
38.66 |
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$ |
28.86 |
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$ |
37.80 |
September 30, 2007 |
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$ |
38.27 |
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$ |
29.10 |
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$ |
36.70 |
December 31, 2007 |
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$ |
43.02 |
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$ |
24.50 |
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$ |
24.89 |
March 31, 2008 |
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$ |
29.28 |
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$ |
17.47 |
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$ |
19.05 |
April 22, 2008* |
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$ |
21.86 |
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$ |
18.72 |
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$ |
20.51 |
* |
High, low and closing prices are for the period starting April 1, 2008 and ending April 22, 2008 |
PS5