Barclays debuts unbundled income investment

Barclays has launched a new Income Generator investment, which is available to investors through platforms and SIPP providers only including Transact, Nucleus and Novia.  Investors will receive a monthly income of 6% per annum equivalent or Base Rate plus 4%, whichever is the higher. The new Income Generator is open to investment until noon on 12th October 2012.

The 6% pa equivalent investment return for the new Income Generator is paid in monthly instalments of 0.50%.  If the minimum initial amount (£10,000) were invested in the new Income Generator, the monthly return would be £50.00, and investors would receive £3,600 over the entire 6 year term.

The Income Generator is designed for investors looking for a monthly income higher than that available from cash or some fixed rate bonds, and who are willing to accept the risks to their capital. It is important to note that repayment of initial capital at the end of the plan is subject to the performance of the FTSE 100 index during the term. If the FTSE index reaches a level of more than 50% below its initial index level at any point during the term, and at maturity is below the starting level, the capital repayment will be reduced by the percentage by which the index has fallen between the starting level and maturity. Otherwise, capital is repaid in full.

The Income Generator is a structured capital at risk product. Investors can sell before maturity but may get back less than they invested irrespective of the index's performance. The investment is subject to the counterparty risk of Barclays Bank PLC.

Richard Henry, Director, Barclays, said: "With interest rates still subdued, investors' need for a source of regular defined income from their investments is as strong as ever. The new Income Generator offers a monthly return of at least 0.50% which is not reliant on the performance of the FTSE index.  Investors are able to access this product through a range of platforms where we are able to offer it commission free."