Nordea Bank Abp is aiming to replace the underlying asset OBX Index and OBX Index Future with O20 Index Future for all instruments issued under its Warrants & Certificates program which currently are referencing OBX Index and OBX Index Future for Bull & Bear Certificates and Mini Futures
The upcoming replacement is a result of the Euronext acquisition of Oslo Børs and Oslo Børs full migration to Euronext. Nordea are currently not able to trade and settle the OBX Index Future on Euronext in its own name. With high implementation costs and increased running costs due to more advanced operational handling and considering the fact that the OBX Index Future is less liquid than the O20 Index Future, Nordea find it beneficial for the holders of the relevant instruments to replace the OBX Index and OBX Index Future with the O20 Index Future.
Both indices are tracking the Norwegian stock market and can easily function as substitutes to each other due to their relative small differences in composition and index weights, with a result of strong correlation between the indices. Keeping the OBX Index and/or OBX Index Future would have necessitated significantly increased fees in the instruments due to Nordea’s increased costs of hedging. By switching to the O20 Index future, this can however be avoided.
The replacement is planned to go into effect on the 3rd of June, which implies that the 31st of May will be the last trading day with the OBX Index / OBX Index Future as underlying asset. Customers will be able to sell back their positions as normal during this time, and from the 3rd of June customers will also be able to increase their positions in the instruments.
Current underlying: OBX TR Index / OBX TR Index Future
New underlying: OMX Oslo 20 GI Index Future
Naming: “OBX” will be replaced with “OMX OSLO 20” in all instrument names.
Affected Instruments can be found in the PDF
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