Retrospective: A simple plan

Barclays Bank issued a straightforward minimum return product just before the financial crisis, linked to the performance of the FTSE 100 index. Ensuing volatility and widening CDS spreads show why such products are rare in today’s markets

Structured Products first reviewed this simple minimum return product linked to the FTSE 100 in April 2007. Issued by Barclays Bank, it offers investors the greater of 28% or a 50% participation in the FTSE 100 over a six-year term. The product is capital protected, so investors will receive at least 128% (100% of capital plus a 28% return) at maturity, regardless of index performance.

The FTSE 100 stood at 6,555.5 on the strike date of May 14, 2007. Its highest closing level during the previous