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Credit Suisse: Nasdaq to suspend Velocity Shares Daily Inverse VIX
By Sarah Lizee
Olympia, Wash., Feb. 15 – Credit Suisse AG announced that the Nasdaq intends to suspend trading of its Velocity Shares Daily Inverse VIX Short Term ETNs (XIV) following the market close on Thursday and institute delisting proceedings.
Nasdaq published an equity trader alert prior to the market open on Wednesday stating its intent to suspend trading of the ETNs.
Credit Suisse said Nasdaq’s announcement to suspend trading of the ETNs does not change the dates related to the event acceleration of the ETNs other than regarding the last day of trading on Nasdaq.
As previously reported, Credit Suisse announced on Feb. 6 that it planned to call the notes due to an “acceleration event.” The acceleration date is Feb. 21, which is three business days after the Feb. 15 accelerated valuation date; each of the dates is subject to postponement due to some events.
On the acceleration date, investors will receive a fixed cash payment per ETN in an amount equal to the closing indicative value of the ETNs on the accelerated valuation date.
As of Feb. 6, Credit Suisse has not issued new units of the ETNs.
Nasdaq informed Credit Suisse that the ability to trade the ETNs following the accelerated valuation date provides no benefit to holders. Nasdaq specifically noted that the ETNs will cease to be a tool that can manage daily trading risks because the cash payment due upon event acceleration will remain fixed after the accelerated valuation date.
Therefore, Nasdaq informed Credit Suisse that “the event acceleration of XIV is an event or condition which in the opinion of Nasdaq makes further dealings on Nasdaq inadvisable.”
Credit Suisse said it will not appeal this determination.
None of the other ETNs offered by Credit Suisse are affected by this announcement.
On Wednesday, the closing indicative value was $5.88.
The notes (Cusip: 22542D795) are linked to the S&P 500 VIX Short-Term Futures index.
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