Barclays Bank PLC (together with its affiliates “Barclays”) is a foundation investor in Barrenjoey Capital Partners Group Holdings Pty Limited ACN 644 241 510 (“Barrenjoey Holdings” and together with its affiliates, “Barrenjoey”) and Barclays has entered into a Co-operation Agreement (the “Cooperation Agreement”) with Barrenjoey Holdings, the parent company of Barrenjoey Markets Pty Limited ACN 636 976 059. The Co-operation Agreement states that Barclays views Barrenjoey Holdings as its strategic ally in Australia and New Zealand.

Barclays currently has a 18.2% economic interest and a 4.99% voting interest in Barrenjoey Holdings and has a representative on the board of directors of Barrenjoey Holdings.

The Cooperation Agreement covers product distribution, research, cross border advisory and debt capital markets, and Barclays makes available significant balance sheet capacity for Barrenjoey to support its clients.

In connection with this arrangement, Barclays may share some or all of its revenues, fees and/or commissions with Barrenjoey and Barrenjoey may share some or all of their revenues, fees and/or commissions with Barclays.

As shareholder, Barclays is not involved in the day-to-day management of Barrenjoey. Barclays does not control Barrenjoey.

Barclays operates financial services businesses that are separate from Barrenjoey.

Cash Equities

Barclays has entered into the Cooperation Agreement to enable it to offer its clients access to key capital markets and cross-border investment opportunities in Australia, New Zealand and other countries through Barrenjoey, whilst providing Barrenjoey’s clients access to Barclays’ strong capabilities across its global network[1].

Drawing on Barclays’ and Barrenjoey’s complementary capabilities, the parties will undertake joint activities in respect of cash equities high touch execution[2]. In respect of cash equities low touch[3] and portfolio execution[4], Barclays and Barrenjoey will continue to operate independent execution businesses, but will draw on each other’s strong relationships and complementary capabilities, and as detailed below will undertake joint activities in respect of certain portfolio trades.

Accordingly:

(i)     Barrenjoey will be the primary executing broker and liquidity provider for Barclays’ executions in Australia and New Zealand securities, subject to best execution requirements and in the absence of any adverse event in respect of Barrenjoey which in the reasonable opinion of Barclays would make it inappropriate to use Barrenjoey as such broker and provider; and

(ii)    Barclays will be the primary executing broker and liquidity provider for Barrenjoey’s executions in non-Australian and non-New Zealand securities.

For trading activity that falls under paragraph (i) of which Barrenjoey acts as the primary executing broker and liquidity provider, Barclays will make payments to Barrenjoey that will correspond to an amount in the range of 60% and 80% (or such amount as is otherwise agreed) of Barclays’ revenue relating to such trading activity. For trading activity that falls under paragraph (ii) of which Barclays acts as the primary executing broker and liquidity provider, Barclays will receive a payment from Barrenjoey that will correspond to an amount in the range of 60% and 80%  (or such amount as is otherwise agreed) of Barrenjoey’s revenue as a result of such trading activity.

In order to effect the joint activities in respect of cash equities high touch execution, Barclays will disclose client and/or trade details to Barrenjoey as described in more detail in the “Disclosure of Information” section below.

For cash equities low touch and portfolio execution, Barclays will continue to operate its business independently and will not disclose any client details to Barrenjoey which would not ordinarily be disclosed to third party brokers in the ordinary course of accessing trading infrastructure via such brokers.

For portfolio trade executions, however, there may be circumstances in which Barclays determines that optimal execution requires the Australian and/or New Zealand component of an order to be handed to Barrenjoey for it to manually work that component in consultation with Barclays.  If such a situation arises, unless otherwise agreed, Barclays will notify the client and seek specific consent to disclose the client’s identity, and any other relevant order/ instruction information to support the execution of that order, to Barrenjoey such that Barrenjoey can directly work the order and communicate with both the client and Barclays regarding its execution.  The relevant commission rates agreed between Barclays and the client in respect of the trade will however remain confidential and will not be disclosed to Barrenjoey.

Further information on the above arrangements may be made available upon request.  For the avoidance of doubt, the arrangements above exclude any cash equities execution that is conducted through Barclays’ Prime Quantitative Prime Services (“QPS”) team which houses Barclays’ low latency execution business.

Neither the Cooperation Agreement nor any other arrangement between Barclays and Barrenjoey create any legal partnership or endorsement.  Neither Barclays nor Barrenjoey is authorized or empowered to act on behalf of the other party.  Neither Barclays nor Barrenjoey is obligated or bound to the other party beyond the express terms of the Cooperation Agreement.

Communications from Barclays and/or Barrenjoey

Barclays Capital Inc. (“BCI”) is a US registered broker-dealer affiliate of Barclays Bank PLC.  BCI undertakes to perform the responsibilities of a registered broker dealer necessary to permit Barclays to avail itself of the safe harbor provided by Rule 15a-6 under the US Exchange Act of 1934 (“Rule 15a-6”).  Where required pursuant to applicable US laws, rules and/or regulations, BCI accepts responsibility for communications made, and the distribution of documents prepared, by Barclays in the United States to US Persons.

Barclays accepts no responsibility for any communication made, or the content of any documents prepared, by Barrenjoey.  Barclays accepts no responsibility for Barrenjoey’s compliance with the conditions of the safe harbor provided by Rule 15a-6 and does not undertake to perform any responsibility of a registered broker dealer contemplated therein on behalf of Barrenjoey.

Barrenjoey have engaged Enclave Capital LLC (“Enclave”) to serve as a registered broker dealer for purposes of satisfying the conditions of Rule 15a-6.  Where required pursuant to applicable US laws, rules and/or regulations, Enclave accepts responsibility for communications made, and the content of any documents prepared, by Barrenjoey.

Disclosure of information

In order to effect the cash equities joint business activities described above for high touch execution, Barclays will be disclosing some or all of the following information to Barrenjoey: client’s name, trades and instruction details, commission rates, axes, indications of interest and feedback provided by clients regarding why a trade was not executed or why a trade was executed at a particular price.   Barclays will not disclose such information unless it has received explicit consent from each relevant client. Clients providing consent, which will only be obtained once, shall be deemed to accept and acknowledge that such consent will override any non-disclosure or other confidentiality agreements or arrangements they may have in place with Barclays either now or in the future unless such agreement or arrangement expressly references this consent to disclose.

To effect the joint activities in respect of certain portfolio trade executions, Barclays will disclose the client’s name and the relevant trade and instruction details to Barrenjoey.  Consent to disclose such information will be obtained on a trade-by-trade basis, unless you instruct us otherwise.

Save for the consent described above, the existing non-disclosure or other confidentiality agreements or arrangements that a client has in place with Barclays (including, without any limitation, any confidentiality agreements or arrangements entered into with Barclays’ QPS business and/or Barclays’ prime brokerage business) will remain in full force and effect.

Risk control framework

Consistent with our commitments and responsibilities, Barclays has developed a robust Conduct Risk control framework to manage our legal, regulatory and reputational risks, including any actual, potential or perceived conflict of interest. This control framework includes, but is not limited to, the following arrangements:

·        Information barriers intended to ensure that Barclays’ business is independent from that of third parties, including related parties (such as Barrenjoey), and that access to information, including client confidential information, is appropriately restricted;

·        Conflict clearance and business selection procedures followed prior to engaging in any joint client activity with any third party, including Barrenjoey;

·        Information sharing protocols for any joint business activities, which would apply where such joint business activities are undertaken with Barrenjoey and would limit information shared to what is necessary to give effect to the joint activities and ensure that such information cannot be used for any other purpose;

·        Fair allocations policies for capital markets transactions; and

·        Best execution policies that require Barclays to take sufficient steps to obtain the best possible result for its clients on a consistent basis when executing transactions on their behalf.

For more information please see: https://www.ib.barclays/disclosures/N2FcdRWQo4/conflicts-of-interest-policy-summary.html

[1] Where permitted by applicable law and regulation.

[2] “High touch execution” refers to execution of single stock client orders by a trading desk.

[3] Low touch execution” refers to electronic execution of client orders.

[4] “Portfolio execution” refers to execution of client orders in respect of a basket of stocks.ocks.