Barclays top U.S. structured products agent for year so far

• Structured products issuance totals $34.55 billion year to date

By Emma Trincal

New York, Nov. 30 - Barclays held on to its place as the top agent for structured products in the United States for the year so far, according to preliminary data compiled by Prospect News.

Year-to-date overall volumes have picked up nearing the year end without yet catching up to last year's volume. Rather the year represents about 60% of last year's issuance in dollar amount.

Total structured products issuance through the end of November was $34.55 billion in 3,928 deals. During the same period in 2008, U.S. issuance was $58.50 billion via 6,218 deals. The 2009 figures are preliminary as not all of November's deals have yet been reported.

Barclays' undisputed lead

Barclays won over its competitors with a very large margin, placing $11.219 billion so far this year, giving the bank a solid lead. Its issuance was almost twice the size of the second-ranked agent, JP Morgan, which brought $6.517 billion to market. Merrill Lynch followed JP Morgan with $5.067 billion.

The ranking with Barclays on top, followed by JP Morgan and then Merrill remained the same as last month.

A year ago, Merrill Lynch was the top agent.

The second placed agent last year was Morgan Stanley, now ranked fourth.

JP Morgan at the same time last year was third in place and has moved one notch up this year.

In percentage terms, Barclays' market shares were almost a third of the total with 32.47%, while JP Morgan and Merrill Lynch sold 18.86% and 14.67% of the U.S. market respectively.

Advisers' outreach

"Barclays is a fairly new name in the financial adviser's community," said Frederick Wright, partner and chief investment officer at Smith & Howard Wealth Management in Atlanta.

"I remember Lehman was very big in the business and so, given that Barclays acquired Lehman, it makes sense that they're so strong today. For some reason though, advisers think of Barclays as being new in the business, not as the bank that acquired Lehman."

Wright said that he is seeing more and more offerings from Barclays.

"So far we saw a lot of JP Morgan. They actively market us, as well as a couple of others. We also see a lot of paper from Charles Schwab's structured notes desk. Plus Goldman of course," said Wright.

ETN maker

Barclays' lead is also clearly established based on deal size.

On the 32 deals in excess of $100 million sold so far this year, Barclays did 20 of them, including the four largest transactions, ranging in size from $2.5 billion to $1 billion, and all exchange-traded notes from Barclays' iPath program. Barclay's position in the ETN market, a product the bank invented, is very much a factor behind its undisputed leadership position in the league tables, market participants said.

Barclay's priced $3.5 billion of iPath ETNs linked to the S&P GSCI Crude Oil Total Return index earlier this year. Another popular ETN offering was the iPath S&P 500 VIX Short-Term Futures exchange-traded notes, which Barclays sold for $2 billion this year in July and in November.

A sellsider, who said that ETNs are structured products and as such have a place in the league tables, however noted: "ETNs are used by hedge funds or asset managers to hedge their bets. They're not necessarily representative of the retail structured products market."

Non-ETNs top sales

Goldman Sachs so far this year issued four deals in excess of $100 million and Bank of America three. Excluding ETNs, Goldman Sachs came up with the largest deal of the year when it priced $346.803 million of autocallable index-linked notes tied to the S&P 500 in the middle of last month. Bank of America priced the second-largest non-ETN deal with the sale in October of $318 million zero-coupon notes linked to the S&P 500 index.

JP Morgan leads equity

For equity-linked structured products, JP Morgan took the lead as the main agent with $4.55 billion priced in 534 deals, followed by Barclays, which priced $3.37 billion in 696 deals. In this equity-only category, just as for the "all products" category, last year's winners were Merrill Lynch as number one, followed by Morgan Stanley.

Barclays' #1 in November

Barclays was also the top agent for the month of November, bringing to market $2.249 billion or about 55% of the total issuance for last month.

The bank's progress is significant compared to last year when Barclays was only the eighth largest agent with 3.90% of the market.

Goldman Sachs followed as the second top agent for the most recent month, with $627 million in 17 deals or 15.32% of the total.

The third player was JP Morgan, with $493 million in 49 deals, 12% of the month's volume.

Barclays was also well ahead of its competitors by number of deals, with 144 transactions during the month.

Barclays remained on top for equity-linked products sold in November, with $1.205 billion in 132 deals, which represented 45.47% of the total $2.649 billion in equity products sold last month. The second agent was Goldman Sachs with $590 million in 11 deals, accounting for 22.30% of the market shares, followed by JP Morgan with $375 million issued via 37 deals and a 14% market share.

November shined

November was the second best month of the year with a volume of $4.093 billion, almost equivalent to the year's best month - February - which saw the pricing of $4.096 billion.

The positive news was the robust improvement last month compared to November 2008, with an increase in volume of 170% from $1.513 billion in the same month last year. Sellsiders have recently told Prospect News that the U.S. market had finally got into new highs comparable to the era before the collapse of Lehman Brothers.

ETNs and autocallables

Barclays, Goldman Sachs and JP Morgan, the top agents for the month, were also the three underwriters that came up with the largest and most popular offerings of the month: ETNs and autocallable notes.

Besides its VIX ETN product, Barclays launched a series of long and short leveraged ETNs linked to the S&P 500 Total Return index, selling a total of $875 million of them last month. The offering was well received as there is no such ETN product linked to the S&P index available to investors, sources said.

The flurry of autocallables offered or sold by the three agents is telling of the market's appetite for these products, sources said, adding that the call feature and the possibility of earning a 7% in a short period of time was very appealing to investors.

Goldman Sachs, besides pricing the largest non-ETN deal of the year with its $346 million autocallable notes linked to the S&P 500, also issued a $175.558 million offering of autocallable notes linked to a basket of equity indexes. The same popular structure (potential 7% return on the notes when called and a 2% minimum coupon guaranteed as long as a 15% barrier is not breached) was also offered by Barclays and sold by JP Morgan in a $90 million sale.

Year to date, all structured products

2008 Comparables

	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Barclays	11.219	850	32.47%	5	5.943	1022	10.16%
2	JPMorgan	6.517	723	18.86%	3	6.353	1193	10.86%
3	Merrill Lynch	5.067	179	14.67%	1	9.249	241	15.81%
4	Morgan Stanley	3.492	292	10.11%	2	7.604	444	13.00%
5	Goldman Sachs	2.536	176	7.34%	4	6.341	253	10.84%
6	Citigroup	1.430	83	4.14%	8	3.948	149	6.75%
7	UBS	1.380	247	3.99%	7	3.999	339	6.83%
8	Deutsche Bank	0.706	125	2.04%	6	4.346	212	7.43%
9	RBC	0.607	594	1.76%	15	0.545	551	0.93%
10	Nuveen	0.424	105	1.23%	10	2.258	81	3.86%
	Total	34.551	3928	58.508	6218
	Average size:	0.009	0.009
Year to date, all structured products, excluding interest rates
					2008 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Barclays	10.666	788	33.58%	5	5.937	1018	11.09%
2	JPMorgan	6.442	718	20.28%	4	6.008	1163	11.22%
3	Merrill Lynch	4.924	169	15.50%	1	8.891	214	16.60%
4	Goldman Sachs	2.363	162	7.44%	3	6.292	246	11.75%
5	Morgan Stanley	2.352	239	7.40%	2	6.424	387	11.99%
6	UBS	1.307	238	4.11%	7	3.922	332	7.32%
7	Citigroup	1.114	65	3.51%	8	2.955	123	5.52%
8	Deutsche Bank	0.628	113	1.98%	6	4.255	200	7.94%
9	RBC	0.528	585	1.66%	15	0.480	536	0.90%
10	Nuveen	0.424	105	1.34%	9	2.258	81	4.22%
	Total	31.764	3729	53.563	5921
	Average size:	0.009	0.009
Year to date, stock, equity index structured products
					2008 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	JPMorgan	4.554	534	26.10%	3	5.096	1035	14.33%
2	Barclays	3.370	696	19.32%	5	2.797	854	7.87%
3	Merrill Lynch	3.072	101	17.61%	1	6.072	137	17.08%
4	Goldman Sachs	1.806	112	10.35%	4	4.881	178	13.73%
5	Morgan Stanley	1.406	129	8.06%	2	5.191	278	14.60%
6	Citigroup	0.925	43	5.30%	7	2.272	75	6.39%
7	UBS	0.744	180	4.26%	6	2.717	246	7.64%
8	Deutsche Bank	0.372	63	2.13%	14	0.453	99	1.27%
9	Wells Fargo	0.347	82	2.08%	20	0.022	3	0.06%
10	RBC	0.332	535	1.90%	15	0.400	494	1.12%
	Total	17.447	2890	35.549	4826
	Average size:	0.006	0.007
November, all structured products
					2008 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Barclays	2.249	144	54.95%	8	0.059	24	3.90%
2	Goldman Sachs	0.627	17	15.32%	3	0.133	12	8.79%
3	JPMorgan	0.493	49	12.04%	1	0.470	50	31.08%
4	Merrill Lynch	0.249	10	6.08%	2	0.379	15	25.07%
5	Morgan Stanley	0.134	22	3.29%	4	0.109	10	7.22%
6	Citigroup	0.115	11	2.82%	9	0.057	4	3.77%
7	RBC	0.066	49	1.60%	13	0.010	16	0.67%
8	Deutsche Bank	0.062	15	1.51%	6	0.079	15	5.25%
9	UBS	0.048	20	1.17%	5	0.089	16	5.89%
10	HSBC	0.014	10	0.34%	11	0.014	8	0.94%
	Total	4.093	384	1.513	208
	Average size:	0.011	0.007
November, all structured products, excluding interest rates
					2008 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Barclays	2.218	139	55.35%	8	0.059	24	3.95%
2	Goldman Sachs	0.614	14	15.32%	3	0.133	12	8.90%
3	JPMorgan	0.493	49	12.30%	1	0.470	50	31.47%
4	Merrill Lynch	0.228	9	5.69%	2	0.377	14	25.19%
5	Morgan Stanley	0.124	21	3.11%	4	0.104	9	6.98%
6	Citigroup	0.115	11	2.88%	9	0.057	4	3.82%
7	RBC	0.065	48	1.63%	13	0.010	16	0.68%
8	Deutsche Bank	0.052	13	1.29%	6	0.079	15	5.32%
9	UBS	0.048	20	1.20%	5	0.086	15	5.76%
10	HSBC	0.014	10	0.34%	11	0.014	7	0.95%
	Total	4.007	371	1.495	203
	Average size:	0.011	0.007
November, stock, equity index structured products
					2008 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Barclays	1.205	132	45.47%	5	0.052	20	4.59%
2	Goldman Sachs	0.590	11	22.29%	7	0.047	8	4.14%
3	JPMorgan	0.375	37	14.18%	1	0.456	44	40.53%
4	Merrill Lynch	0.216	8	8.15%	2	0.314	8	27.93%
5	Citigroup	0.076	5	2.85%	6	0.051	2	4.55%
6	Morgan Stanley	0.069	11	2.59%	10	0.010	4	0.85%
7	RBC	0.049	44	1.85%	11	0.009	14	0.78%
8	UBS	0.027	17	1.01%	3	0.076	12	6.79%
9	RBS	0.013	27	0.48%
10	HSBC	0.011	9	0.41%	13	0.005	4	0.40%
	Total	2.649	309	1.124	153
	Average size:	0.009	0.007
Prospect News Structured Products Manager Rankings

Criteria

• The tables include all dollar-denominated offerings sold in the United States as public, Rule 144A or similar deals reported to Prospect News.

• Offerings are included in the time period in which they price.

• Amounts are based on the total sales price (face amount multiplied by the offering price). The full amount is credited to the lead manager. For multiple managers, the total value is divided equally among all the firms.

• Each tranche is counted as a separate deal.

• Notes are included that convert into or are linked to one or more stocks, indexes, commodities, currencies, interest rates or other assets. For interest-rate deals, callables with no further structure are excluded.

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