Barclays to close Defined Returns Plan early

Barclays Wealth is closing its best-selling Defined Returns Plan two weeks early and immediately issuing a replacement series following exceptional demand from investors keen to access fixed pay-off style conditional returns.

DRP Capital Protected, which offers the potential for high returns over three investment periods, will close to new business at 5pm on Monday 19 January. To ensure a smooth transition Barclays Wealth is bringing forward the edition scheduled to start next month, which will be available from Tuesday 20 January until 27 February 2009.

The new DRP CP offers three options delivering potential returns of either:

12 per cent - three-year option
22 per cent - four-year option
32 per cent - five-year option.

All three investments offer full capital protection when held for their full terms and will deliver their stated return provided the FTSE 100 at maturity is equal to or higher than its level at the starting date.

Due to significant changes in market conditions in recent weeks, the terms for the new DRP investment are lower than the preceding series. However, they remain highly competitive against a backdrop of historically low interest rates and continuing market volatility.

Despite the early closure of DRP CP, the closure date for DRP Annual Kick-Out - its sister investment - remains unchanged (30 January 2008).

Colin Dickie, director, Barclays Wealth, says: "Demand for the DRP CP has proved exceptional but market conditions have changed significantly in recent weeks and we have been unable to secure greater capacity with the same terms. Indeed, terms for most capital investments are expected to be lower this year as the pricing environment makes 2008-level terms much harder to repeat.

"Nevertheless, our new DRP investment remains highly competitive when set against the negative real return offered by cash on deposit, and the clear tax benefits should also tempt investors to take slightly more risk in order to receive a much-enhanced return."