SRPInsight Issue 25 | October 2023 @SRP_Insider

ON THE
GROWTH
TRACK

FEATURE // CRYPTO Q&A // MERQUBE ANALYSIS // LOW VOL

STRUCTURED PRODUCTS p24 p36 OPPORTUNITIES p46
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Featuring coverage of thousands of products across the US, dynamic product reports and aggregate reporting
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 CONTENTS

Contents
Editorial:
Amelie Labbé, Pablo Conde, Summer
Wang, Marc Wolterink, Jocelyn Yang

Production:
Paul Pancham
News Europe 4
Marketing:
Daniel Evans
News Americas 10
Sales:
Reihaneh Fakhari News Apac 18

If you are interested in having a similar Feature: Crypto structured products 24

bespoke report produced for your
organisation, please contact:
SRP Americas Personality of the Year 26
Reihaneh Fakhari
SRP Americas Panel: Annuities 27
T: +44 (0)20 7779 8220
M: +44 (0)79 8075 6761
E: Reihaneh@structuredretail SRP Americas panel: Canada 28
products.com

SRP Americas panel: Platforms 29

SRP Americas Awards Gallery 30

Reprint policy:
SRP’s Reprint Policy: Articles published by SRP
can be sent to sources for reference and for Q&A: Buyside View 34
internal use only (including intranet posting
and internal distribution). If an article is to be
shared with a third party or re-published on a Q&A: MerQube 36
public website (i.e. a location on the World Wide
Web that is accessible by anyone with a web
browser and access to the internet), SRP offers Q&A: MSCI 38
reprints, PDFs of articles or advertisements,
and the licensing to republish any content
published on the SRP website. Prices vary Crypto news 40
depending on size, quantity and any additional
requirements. To request authorisation to
republish any Q&A, profile or feature published StructrPro: Trends 44
by SRP, please contact:
[email protected].
Analysis: Low vol opportunities 46

Spotlight on US 48

Spotlight on South Korea 49

Product wrap 50
Front cover image: Blue Planet
Studio/Adobe Stock
People moves 53

www.structuredretailproducts.com 3
 NEWS | EUROPE

IDAD, RBC partner for range accrual

on SPX
IDAD has launched US Income Deposit Plan Issue 1, November 2023 in the UK. The six-year
capital protected plan offers access to the S&P 500 with Royal Bank of Canada (RBC) acting as
the deposit taker.

“The range accrual style of product isn’t Year to date, the company has
that prevalent but seems to resonate distributed 21 deposit plans in the UK,
with advisers and their clients who are and although not set in stone, IDAD
expecting rangebound markets – albeit concentrates on offering deposits to the
pretty wide range markets,” he said. retail market.

Combining the shape with the 100% “Separately we arrange capital at risk
capital protection/financial services products for particular advisers on a
compensation scheme (FSCS) structure regular basis, but tend not to launch
gives investors the confidence they them as general offers,” said Moore.
seem to want, according to Moore.
The range accrual payoff features in
“They’re risking their interest in the hope seven products in the UK this year. Apart
of doubling it, or thereabouts,” he said. from the six that were available via IDAD
(all of which were issued via RBC) these
The plan is the sixth range accrual include the FTSE 100 Income Builder
marketed by IDAD since May, and the Plan, which was distributed via Mariana
first linked to the S&P 500, with the in February.
remaining five structures all tied to the
FTSE 100. The SRP UK database lists 110 live
structured products from IDAD, dating
The product features an upper barrier The latter include the UK Income back to February 2018.
of 123.5% a lower barrier of 75% of the Deposit Plan Issue 5, November 2023 –
initial strike and offers a coupon of 10% currently open for subscription – which The structures are worth an estimated
pa providing the index closes between offers a potential coupon of 7.50% pa £235m (US$285m) and were issued in
the upper and lower barrier levels on any and upper and lower barriers of 120% collaboration with 12 different issuer
annual observation date. and 80%, respectively. groups, including, among others,
Goldman Sachs (28), BBVA (23), Barclays
“This product shape has been popular “The S&P 500 option was to take (13), RBC (seven), and BNP Paribas (five).
with investors looking for a chance of advantage of wider range where we felt
higher income – preferring the income there was a bit more value than FTSE Some 59 of the live products featured
rather than the growth,” said Clive 100, also, it’s an option for advisers and the autocall payoff; 36 were callable; 27
Moore (pictured), portfolio manager and clients who want alternative exposure,” offer leverage upside; six were range/
managing director, IDAD. said Moore. accruals, and five were digitals.

The S&P 500 option was to take advantage of wider range where
we felt there was a bit more value than FTSE 100, also, it’s an
option for advisers and clients who want alternative exposure

4 www.structuredretailproducts.com
 NEWS | EUROPE

Crelan targets French banks, CMS

success story continues
The Belgian bank has launched four CMS-linked products since the end of last year.

2022. The first two were issued on the gathered combined sales of €475m,
paper of Société Générale; the third according to SRP data.
product was launched in collaboration
with BNP Paribas; and the current issue “The first emission was a great success,
is manufactured by Natixis. which made us realise that the demand
for such products was very high, and
“We always ask several partners about after that we released three more
a specific product proposal,” said Koen emissions which also sold incredibly
Theys, product, market & marketing well,” said Theys.
specialist at Crelan.
However, Theys is unsure yet if the
Once the respective issuers have bank’s next emission will be another
provided their product conditions, the interest-linked product.
Belgian bank comes up with a proposal
based on those conditions and the “We are now considering whether to
concentration level of the partners. continue with this type of structure or
Crelan has collected €128m with the whether to switch to an equity-linked
Natixis (FR) Fixed to Floating CMS linked “We like to diversify and do not want product for the next issue, in order to
Coupon 2029 in Belgium. too much turnover from one particular diversify our portfolio,” said Theys.
partner in our network,” said Theys.
The bank’s latest product on the Some 38 interest-linked products worth
constant maturity swap (CMS) rate After a long period of low interest an estimated €1.6 billion have been
offers a fixed coupon of 4.10% pa for rates, it finally became possible again publicly offered in Belgium in 2023 to
the first three years of investment. From for Crelan to offer structures with an date, up from 36 products worth €825m
years four to six, a variable coupon equal attractive coupon at the end of last year. in full year 2022, according to SRP data.
to two-times the difference between the
30-year EUR CMS rate and the five-year Previously, the bank had mostly focused Apart from Crelan, this year’s interest-
EUR CMS rate is paid. on products linked to a single equity linked offering included, among others,
index that pay a potential return at two products from Belfius that sold
The variable coupon is subject to a maturity, but keen not to miss this €521m; 16 products distributed by
minimum of two percent and a maximum opportunity it opted for an interest- Deutsche Bank (€300m); nine by BNP
of five percent pa. At maturity, the linked coupon paying proposal instead. Paribas Fortis (€145m); and one by
structure returns 100% of the nominal Nagelmackers (€58m).
invested. The product in question, Société
Générale (FR) Fixed to Floating CMS Crelan’s Fixed to Floating CMS linked
The product is the fourth fixed to floating Linked Coupon Note 2028, sold Coupon Notes are also distributed
rate coupon note linked to CMS rate €150m during its subscription period via the branch network of AXA Bank
distributed by Crelan since November and the three products that followed Belgium.

The first emission was a great success, which made us realise

that the demand for such products was very high

www.structuredretailproducts.com 5
 NEWS | EUROPE

SSPA: structured products enhance

pension funds’ toolkit
The Swiss Structured Products Association (SSPA) has published the handbook Structured Products and
Derivatives for Pension Funds.

funds. They look at risk management have unique features and are flexible and
and structuring opportunities and efficient instruments.
discuss legal aspects as well as the
main features and risks of structured They allow pension funds to access
products that pension funds need to traditional as well as non-traditional
consider. asset classes with a targeted risk-
return profile, which meets the specific
Why are structured products requirements of the pension fund. This
currently only make up a very well positions structured products as
small proportion of pension fund additional investment instruments which
portfolios? can enable pension funds to achieve
the required returns, also in challenging
Thomas Wicki: The SSPA believes market environments.
that due to the technical complexity of
the products as well as the legal and Understanding the opportunities and
regulatory aspects, Swiss pension funds risks of the products is of course very
have been holding back from investing important.
in structured products.
Why does the SSPA believe that
In addition, the fact that structured structured products can make an
products customised for institutional important contribution to pension
The aim of the handbook is to improve investors are less well known than the funds?
the understanding of structured traditional structured products with
products among pension fund payoff-profiles more suitable for private Thomas Wicki: With structured
portfolio managers and to present the investors, may also have prevented products, pension funds can access
advantages and risks of structured pension funds from investing. The investment profiles and risk premia,
products in a transparent manner, handbook, together with an additional which are not easily available via other
according to Thomas Wicki (pictured), presentation with practical case studies investment vehicles.
board member of the SSPA. on how pension funds can utilise
structured products, aims to address Even though pension funds are long-
“Structured products and derivatives these challenges. term investors and often prefer linear
have been successfully utilised by many payoff profiles, they must regularly
institutional investors in Switzerland,” An additional complexity was that report their financials, including the
said Wicki, who is confident that structured products were considered as coverage ratio. Therefore, a product
structured products can also add value not cost-transparent for pension funds with an asymmetric payoff profile,
within pension fund portfolios. until 2019, which resulted in additional for example with a partial downside
disclosure requirements for pension protection, can be a suitable investment.
“Due to their unique features and funds. With the cost transparency
flexibility, [structured products] can concept of the SSPA, which was In addition, a pension fund may want to
complement an existing portfolio or approved by the Occupational Pension enhance a bond portfolio with credit-
enable a pension fund to access an Supervisory Commission at the end of linked notes or add a particular risk
asset class or risk premia in line with its 2019, this complexity was removed. premia to its portfolio which can be more
desired risk tolerance,” he said. efficiently accessed via a structured
What are the opportunities and risks product than with another instrument.
In the handbook the authors discuss for the use of structured products in
the macroeconomic and regulatory pension funds? Overall structured products and
environment, and the resulting derivatives enhance the toolkit of
investment implications for pension Thomas Wicki: Structured products instruments available to pension funds.

6 www.structuredretailproducts.com
 NEWS | EUROPE

Vox pop: funds of structured products –

back in the black
SRP asked four fund managers about the performance of their fund in the first half of 2023, their
highlights for June, and their expectations for the rest of the year.

1.82% and end-June 2023 we closed As we look ahead to the rest of the
at an impressive 8.58% in Swiss francs. year, we have great confidence in the
The fund's defensive strategy has also fund's performance. The portfolio has
worked well, with annualised volatility of been carefully curated, and we continue
just 6.1% and a max drawdown of 5.11% to receive steady coupons from our
since launch. existing positions, which bolster the
overall performance.
In June, we took advantage of several
early redemptions to diversify the Despite a recent decline in market
portfolio, increasing the number of volatility, we have maintained
indices used as underlyings, and an attractive average coupon,
staggering maturity dates. The number demonstrating our ability to generate
of positions held by the fund also returns even in calmer market
increased, and we were able to add new conditions.
issuers.
One of the key strengths of the fund
For example, we traded with Luzerner lies in its resilience during challenging
Kantonalbank a Conditional Coupon times. In the event of a market downturn,
BRC on a basket comprising Eurostoxx the current buffer to the capital barriers
50, S&P 500 and Swiss Market Index, is substantial, enabling us to withstand
and with BBVA a Conditional Coupon significant shocks of 40% to 50%,
BRC on a basket comprising ASX 200, depending on the product.
Finanzlab Multi Index Fund Hang Seng and Kospi 200.
In conclusion, our expectations for
Vincent Bonnard (pictured), founding We are introducing our brand-new the rest of the year are optimistic.
partner, Finanzlab. reporting platform Strukif, which The strength of the fund's portfolio,
provides investors with detailed fund combined with its ability to preserve
Despite challenging market conditions, information, performance analysis and capital in the event of a market
our fund has delivered a strong and comparison tools. Additionally, it grants downturn, makes it an appealing
consistent performance since its access to all available documentation, investment choice for those wishing to
launch in October 2021. In 2022, we ensuring transparency and clarity for our remain invested, even after the recent
posted a positive performance of valued investors. market rally.

The portfolio has been carefully curated, and we

continue to receive steady coupons from our existing
positions, which bolster the overall performance
Vincent Bonnard

www.structuredretailproducts.com 7
 NEWS | EUROPE

market in Ireland where we have big French and US government. You could
Ballybunion Insignia Defined aspirations. We're talking to a very large say that the risk on financial institutions
Returns Fund international life company, and we're has become minimal.
hoping to be added to their platform
Peter Murphy, founder and managing shortly. That would be huge because it All things being equal, expectations for
director, Insignia Financial. would open a whole new market for us. the rest of the year are in line with the
coupons we are now receiving on new
At the end of June, we reached €27m, If the market ticks along, which we think products, time-weighted of course,
but as of today, we are already at about it will – just kind of going sideways – that although changes in volatility and in the
€28.5m. Pretty much everything in our would be perfect for us, then I think we performance of the indices can affect
book has done well. can certainly add to the gains we've the value development.
seen already this year.
One of the biggest contributors is a
long-held position we have in airlines, The portfolio remains very well MGTS Idad Refined Growth
with a very strong coupon. It has been positioned. The mix of stocks underlying Fund
very volatile and a rough ride, but it the notes in the fund is high quality and
has improved hugely. It is the biggest the defensive structure of the notes Clive Moore, portfolio manager and
position in the fund, and it is likely to add allows us to have a lot of confidence managing director, Idad.
considerably more value. around future performance.
The Refined Growth Fund has been
We have also had some success with With volatility low, we have been running for almost two years now
Eurostoxx Banks, a position that matured consciously building cash levels to be and it has been 12 months since we
in early June. The index itself was up in a prime position to act once pricing implemented a strategy refinement.
nine percent and we were up 26% on the conditions inevitably improve.
position on the note. It has been going While the AuM is still principally
great across the board. We are very confident that we will comprised of our own money and some
deliver the 7-9% target return, and it will from specific mandates we run, we
We have had strong positions in tech, probably be at the higher end of that are pleased the strategy matches our
luxury and we have just taken out some over the rolling five-year period. experience and expectations in terms
insurance positions, slightly more of performance and are beginning to
boring. We are somewhat de-risking the market slightly more widely.
portfolio a little bit and are holding quite Mondriaan Structures Fund
a bit of cash now. The year 2023 has been a very
Jeroen Sinnige, managing director interesting year in terms of equity
Our realised gains within the portfolio portfolio management, Mondriaan market performance but the geographic
have been nearly 100%. We only have Asset Management. spread and pay-off variety continues to
one position that we think may not work serve us well.
out, but that is well within the tolerance The value increase of our fund in 2023 is
of the fund. now above seven percent. In June, some Our strategy of incorporating secondary
structures with a slightly lower buffer to market trades into the portfolio,
First and foremost, we are an autocall the redemption barrier were autocalled particularly trades close to final maturity,
fund. It will be always at 80-85% of what at 100%. All coupons were also paid out has worked well as spreads and implied
we do, because that is how you generate and the average distance from the worst risk premia close.
the defined return, but there are to the redemption barrier has therefore
occasions, when vol is low and where increased. The market outlook for H2 2023 has
interest rates dictate that you can find been improving, but we maintain a
value elsewhere as well. The conversion of investments in notes focus on protecting capital as much
into the individual building blocks is as targeting the higher returns that are
Recently, we have added a twin-win to almost complete. The fund still has one available because of higher interest
the portfolio, and we just traded a shark note in the portfolio with a weighting rates.
note – fully protected with participation of less than one percent of the total
on the upside. Our mandate allows us to assets. This means that more than 99% While new investments should deliver
do other things. is invested via the individual building higher returns than some did 12 months
blocks. ago, we have incorporated stronger
Our product is fantastic for the defensive features as well, and the fund
institutional market, but we are probably These are the derivatives that normally will continue to deliver growth even
just a little too small at this point. Our form part of a note. For funding we when traditional equity investments fail
primary focus has been on the IFA use short-term bonds from the Dutch, to do so.

8 www.structuredretailproducts.com
 NEWS | EUROPE

Swiss boutique targets Germany’s DDV renames

self-directed investors as Bundesverband

für strukturierte
Wertpapiere (BSW)
Swiss boutique CAT Financial Products (CATFP) has listed its first
exchange-traded product (ETP) on the SIX Swiss Exchange.
The German Derivatives
Association (Deutscher Derivate
professional strategies and future Verband, or DDV), the industry
themes and to make them tradable,’ representative body of the
said Roman Przibylla (pictured), head issuers of structured securities in
public solutions. Germany, has changed its name to
the German Structured Securities
CATFP's ETPs are issued using SIX's Association (Bundesverband für
Triparty Collateral Management (TCM) strukturierte Wertpapiere, or BSW).
collateralisation solution which reduces
the issuer's default risk. The pledged ‘With the change of the name to the
collateral is held in custody at SIX SIS BSW, we are replacing the technical
Ltd and SIX Repo Ltd, as collateral agent; term of derivative,’ Henning
it is responsible for the daily monitoring Bergmann and Christian Vollmut,
of the collateral. co-CEOs of the association, said
during the presentation of the new
The new ETP tracks the performance of association name at the annual
the Obermatt Swiss Pearls Index which industry forum in Frankfurt, initially
is an index developed by the Obermatt reported by local media.
Institute, a non-profit organization based
CATFP is entering the listed products in Zurich. ‘In doing so, we are positioning
segment after receiving authorisation structured securities where the
from FINMA to operate as a securities firm The index is made up of 36 of the majority should be classified:
tapping into a new target group consisting top-ranking stocks that provide a well- shoulder-to-shoulder between the
of self-directed private investors. diversified and representative selection traditional security categories of
of quality stocks on the Swiss stock bonds and equities,’ they said.
‘ETPs play an important role in our exchange. The selection of stocks in the
business strategy. The goal is to give index is based on Obermatt’s rule-based ‘As genuine securities, our
private investors access to new markets, 360° View on value and growth. members’ financial products
deserve to be called such,’
Vollmuth highlighted, adding the
qualifications these member
institutions have, such as having

GenTwo and Swissquote enter

‘prospectuses approved by the
supervisory authority,’ ‘transparent
payout profiles,’ ‘are listed on
into partnership stock exchanges,’ and ‘use the
entire infrastructure of securities
trading and settlement’.
Swiss B2B fintech company GenTwo has traditional equity, foreign exchange,
teamed up with online bank Swissquote as derivatives, structured products, The 15 member institutions of the
a partner network in a move to strengthen commodities, and digital assets. BSW, such as Barclays and BNP
its financial engineering network. Paribas, account for a market volume
This partnership further positions of structured securities amounting
The partnership will enable Swissquote GenTwo as the provider of the most to €95 billion, according to the
clients to have access to GenTwo's advanced AMC solution available in association. Investment products
services, allowing them to create the current financial market, and so comprise over 97% of this market
Actively Managed Certificates (AMC) in further enhances its value proposition, volume, with leverage products
collaboration with Swissquote across according to Philippe A. Naegeli, CEO and accounting for the remainder.
a wide range of assets, including co-founder of GenTwo.

www.structuredretailproducts.com 9
 NEWS | AMERICAS

Top issuers Americas H1 2023: US top

three reshuffle, CIBC, Monex hold firm
Sales volumes remained stable at US$54.4 billion despite an 8.4% increase in issuance: from 15,779 in
H1 2022 to 17,106 this time around.
The latter was reflected in the average bank’s offering was linked to equity indices Canada
sales volumes, which fell to US$3.2m per or stocks, while ETF, hybrid assets and NBC was also active in its domestic market,
product (H1 2022: US$3.5m). interest rates accounted for 81, 50 and 25 where it held a market share of 16% in H1
products, respectively. 2023, second behind Canadian Imperial
J.P. Morgan replaced Goldman Sachs as Bank of Commerce (CIBC).
the largest issuer, obtaining a market share UBS issued 1,673 products valued at US$3.5
of 15.5% on the back of selling 3,874 billion (6.4% market share) which was a The latter remained the number one
products worth US$8.4 billion – a 6.1% decline from the prior-year period when it Canadian provider, increasing its market
increase year-on-year (YoY). collected US$4.3 billion from 2,446 products. share by 5.2 percentage points to 23% in
H1 2023. It sold 575 products in the first
The bank’s products were linked to a group It's noteworthy that Credit Suisse only six months of the year – mostly autocalls
of 283 underlying assets, a decline from issued 69 products worth US$115.7m linked to a single equity index.
330 in H1 2022. Its preferred underlyings during H1 2023, a stark contrast with
were S&P 500 (1,879), Russell 2000 (987) the prior year semester when it was the Scotiabank claimed 8.9% market share
and Nasdaq 100 (700). seventh largest issuer on the back of 876 in H1 2023 while other issuers included
products that were worth US$2.9 billion. Toronto Domion Bank, Royal Bank of
Citi captured 14.1% of the US market, Canada, and Desjardins.
collecting US$7.7 billion from 2,382 The Swiss bank’s most recent issuance
products while Goldman gathered a was traded mid-March when its forced The most used underlying in the semester
combined US$5.8 billion from 1,752 merger with UBS was announced. was the Solactive Canada Bank 40 AR
structured products issued, which Index, which was linked to 924 products
translated to a market share of 10.7%. There were 18 active issuers in the that collected US$1.6 billion.
semester (H1 2022: 19) including National
Morgan Stanley remained in fourth Bank of Canada (NBC), which did not Mexico
place with sales of US$5.6 billion from participate in the prior year period but first Monex was once again the main issuer
1,996 structured notes – stable YoY – joined the US issuer ranks with autocallable in Mexico. It increased its market share
representing 10.3% market share. notes in July 2022. NBC issued 10 to 72% in H1 2023 – up 13 percentage
structured notes in H1 2023. points YoY.
Next in line was Barclays, which advanced
from eighth place after doubling its sales The S&P 500, which featured in 7,897 The financial services provider launched
volume to US$4.8 billion (from 1,281 products (US$25.8 billion) was the main 1,913 structured products worth MXN111
products). Approximately 88% of the underlying in the period. billion (US$6.1 billion) in the period.

iCapital introduces new portfolio analytics tool

US fintech platform iCapital has launched iCapital Architect, a portfolio construction tool to empower financial advisors to build
personalised client portfolios incorporating alternatives and structured investments.

The tool enables advisors to evaluate alternatives and structured investments alongside traditional assets and design portfolios that
align with their clients’ return objectives and risk profiles. Among the features are resources for evaluating historical performance and
running institutional-quality risk factor analysis, according to a statement from iCapital.

‘Advisors have long expressed a need for more comprehensive tools to effectively evaluate the inclusion of alternatives and
structured investments in client portfolios,’ said Lawrence Calcano, chairman and CEO of iCapital. ‘These investments have been the
blind spot in many portfolio construction offerings.’

10 www.structuredretailproducts.com
 NEWS | AMERICAS

Top underlyings Americas H1 2023:

Nasdaq is back, Canada favours thematics
In the US retail structured note market, H1 2023 sales volumes remained stable at US$54.4 billion
despite issuance increasing to 17,106 products (from 15,779 in H1 2022), according to SRP data.

The S&P 500 was used as a single index in US$436.3m in sales volume (187 products), issuance fell to 20 (from 246 in H1 2022).
3,774 products worth US$15.6 billion – the 40.4% higher YoY. Trailing closely behind
equivalent of a 28.7% market share. Its were Apple and Tesla in the form of single Next in line is the share basket of Canadian
volume was up 10.6% YoY. stocks, which collected US$427.6m and Natural Resources, Cenovus Energy and
US$399.4m, respectively. The volume Suncor Energy, which is linked to 103
The 611 products linked to interest rates translated to a respective fall of 30.1% and products. The S&P 500 dropped one
made up 12.4% of the market, on the back 37.7% YoY. place to fourth, with issuance down to 82
of 611 products sold at US$6.7 billion, products (H1 2022: 180).
which represented a 23.9% decline in sales Canada
volume from H1 2022. Compared with US, the Canadian market The Solactive Canada Utilities 105
saw greater change and less concentration AR Index completed the top five, replacing
A basket comprising Nasdaq 100, Russell in global headline indices in terms of top the Solactive Canada Insurance AR Index.
200 and S&P 500 continues to be the third underlying assets by issuance. In H1 2023,
most favoured pick despite a drop in sales a total of 2,431 structured notes were Mexico
volume to US$4.9 billion (H1 2022: US$3.3 issued, a decrease from 3,433 YoY. There were 2,907 structured notes issued
billion). The SPDR S&P 500 ETF Trust at MXN154.9 billion (US$9.1 billion) in the
gained traction as 214 products were sold The Solactive Canada Bank 40 AR Index country in H1 2023, up 6.5% YoY. Some
at US$1.6 billion on the exchange-traded continued to top the league table. It was 2,700 products worth MXN128.4 billion
fund (ETF), a 1.5-fold increase YoY. used as the underlying index for 815 were linked to the appreciation of the
structured notes during the semester, Mexican peso relative to the US dollar. They
Sales linked to the Nasdaq 100 as a single nearly doubling its issuance from the were mostly dual currency notes or range/
index increased to US$943.4m – up prior-year period. The Solactive Canadian accruals with a maturity of one or two
43.8% year-on-year (YoY). The volume was Large-Cap 100 AR Index advanced to the weeks.
generated from 240 products (H1 2022: second place. It was seen in 121 products,
150 year). compared to just 15 in H1 2022. The remaining 207 products were linked to
the interbank equilibrium interest rate (TIIE
In the equity space, the single stock It replaced the Solactive Equal Weight 28). They offered 100% capital protection
of Amazon was the most popular with Canada Banks 5% AR Index, whose and gathered sales of MXN16.6 billion.

US advisory launches third party investment solutions platform

On 8 August, NewEdge Wealth, the US registered investment advisor introduced NewEdge Investment Solutions platform, which is
‘designed to provide third-party financial professionals and institutions with access to many of the same strategies it utilises to help
their own ultra-high-net-worth (UHNW) clients achieve their goals’.

The new platform aims to provide investments ‘that are hard to get into, find or have structural advantages themselves’, stated the
firm, a division of NewEdge Capital Group. The company highlighted its ‘innovative approach to investing in structured notes and
creating managed investment strategies that utilise them’.

‘In combination with providing NewEdge Wealth's ultra-high net worth clients with a highly personalized approach to wealth strategy,
we believe we have unlocked several investment strategies that adapt to the ever-changing market landscape,’ said Rob Sechan,
CEO and co-founder of NewEdge Wealth.

‘Our strategies are designed to deliver superior outcomes while producing returns which may be difficult to achieve through
conventional equity and bond markets,’ he added.

www.structuredretailproducts.com 11
 NEWS | AMERICAS

MerQube gets further backing

Indexing technology company MerQube has raised US$22m in Series B funding - the investment round
was led by Intel Capital with participation from new investor Allianz Life Ventures, and existing investors
Citi, J.P. Morgan, Laurion Capital Management and UBS.

and API-first solutions are designed In May 2023, MerQube received FCA
and built to address and unlock unmet authorisation under Benchmarks
demand for index-linked investments, a Regulation (BMR) and in September
market valued at US$17 trillion which is 2022, it confirmed its adherence to
evolving rapidly with assets expected to International Organization of Securities
reach US$30 trillion by 2027, according Commissions (IOSCO) principles for
to Vinit Srivastava (pictured), CEO at Financial Benchmarks.
MerQube.
MerQube is one of the latest entrants to
‘The support of a leading technology the structured products market and has
V.C. firm such as Intel Capital will be established its MerQube’s US Tech+ Vol
instrumental as we deliver on our Advantage Index as one of the highest
vision to close the fintech gap in selling thematic indices in the US market
passive investing by providing the – the index was used in 246 products
best technology available to enable issued via J.P. Morgan in the US worth
innovative rules-based investment US$74mn in 2022.
In conjunction with the financing, David solutions,’ he said. ‘The participation
R. Mueller, investment director at Intel of a powerhouse such as Allianz Life MerQube plans to deploy the funds
Capital, will join MerQube’s board of Ventures will provide strategic direction raised to further expand its engineering
directors. in the insurance market as we continue capabilities and platform infrastructure,
to expand to meet the needs of a scale its talent, and continue to expand
MerQube’s cloud native SaaS platform diverse client base.’ into its key markets.

Financial advisor's ETN craze cost clients US$11m

A financial advisor who was the principal in losses between 2017 and 2021. The value of the CS ETN fell steadily
of an RIA for 21 years racked up more from the mid-twenty-dollar range in
than $11 million in client losses by selling According to the regulator’s order, late February 2020 to just US$0.52 per
investment products he didn't understand, Chadwick ‘displayed a fundamental share — its lowest value — on 18 March
according to US state regulators. misunderstanding’ of the ‘complexity 2020.
and risk’ of the Credit Suisse X-Links
Thomas M. Chadwick of New London, Monthly Pay 2xLeveraged Mortgage The state regulator is requesting a
New Hampshire-based Chadwick REIT ETN, which was delisted in permanent bar against Chadwick from
& D'Amato has been accused of December 2021 amid steep losses in securities licensure in New Hampshire
investment fraud as it recommended value during the pandemic. and restitution of US$11,108,725.09
that his clients invest 50% to 92% plus statutory interest for Chadwick’s
of their portfolios in a Credit Suisse ‘[Chadwick] failed to act in his clients' investors.
exchange-traded note (ETN) and held best interests and breached his fiduciary
shares in the highly volatile real estate duty of care and loyalty,’ stated the Additionally, the Bureau requests that
product for an average of 386 days, regulator’s order. Chadwick pay a fine, investigation and
state regulators said. enforcement costs, and other equitable
The order also noted that Chadwick’s relief. In April 2022, the Bureau filed a
The New Hampshire Secretary of State's clients were primarily low-to-moderate petition for emergency relief against
Bureau of Securities Regulation secured risk investors including elderly and Chadwick in a separate case, alleging he
an order for relief on July 27 alleging that retired individuals ‘who relied on fixed fraudulently accessed his former clients’
his activities cost clients US$11.1 million income disbursements’. Fidelity accounts.

12 www.structuredretailproducts.com
 NEWS | AMERICAS

Monex debuts Sofr play

Monex Grupo Financiero has launched the first ever product in Mexico linked to the CME TERM
SOFR 1M Coupon Range.

opens opportunities to offer new notes “All of our notes are practically
linked to US dollar rates,” said Huitrón. dominated by the short term, which is
where we have the highest volume. In the
“We chose the CME TERM SOFR 1M current context it is difficult to introduce
because it is calculated by a recognised the three-month product given the
exchange - our clients are already familiar Bank of Mexico’s decision to stop rates
with the structure, as well as the coupon increases until next year.”
payments and the full protection this kind
of structure offers.” According to Huitrón, the three-month
term has practically extinguished
At the moment and given the rates which has forced Monex to migrate all
environment, Monex is not looking at structured notes to six and nine-month
deploying other reference rates but will investment terms.
seek to play with different maturities to
offer choice to investors. “Now we are focusing on modifying the
renewals to longer investment terms
“Most of the issuance are three-month in order to be able to continue rolling
structures but we have also starting over products that reach maturity,” said
to close at six, seven and nine months Huitrón.
The new interest rate structure which has
a term of 184 days is fully protected and Monex’s dual currency notes continue
will pay six coupons of 5.90% throughout to be the main offering product – this
the term. product range comprises bonds, duals
and notes with capital protection with
The product created by Monex’s
Derivatives Desk is the first structure in
We expect the investment terms of between seven and
14 days.
the Mexican Market using the CME TERM
SOFR 1M as the underlying.
CME TERM SOFR “We continue to grow this part of the

“We practically stopped issuing TIIE-

notes to resonate business – our issuance and sales of
dual currency notes grew exponentially
linked notes two years ago because it
was difficult to offer value to our clients among our clients in 2022,” said Ricardo Guido, head of
derivatives at Monex.
but last year, we saw an opportunity to
relaunch the business and compete with “Year to date, we have almost tripled sales
other players in the rates space,” said in all products. The market is generally
Alan Huitrón Fernández (pictured), senior so that we can position our clients holding up well in terms of demand.”
rates derivatives trader at Monex. in different maturities with the same
underlying,” said Huitrón. The revival of Monex’s TIIE-linked notes
Rates-linked products have always has also increased the pool of clients
been Monex's flagship product, and a Monex which has raised over MX14 billion distributing the notes as well as its market
differentiator for the provider over the (US$875 million) it resumed the issuance share which now amounts to 75% of the
years in Mexico. The company retained of TIIE 28-linked notes in October 2022 is overall market activity.
its crown as the top issuer of structured seeking to replicate this success with the
products in Mexico in 2022 with more new SOFR-linked notes. “We have gone from having practically
than 60% market share. one counterparty distributing our
“It's a bit of a change of chip for us as this TIIE Notes to having more than five
“The launch of the new CME TERM is a new product. We expect the CME and growing,” said Guido. “We have
SOFR-linked structure is the first of many TERM SOFR notes to resonate among our reactivated flows and are getting requests
as there is market demand. The idea is clients as we saw with the TIIE notes,” said from all sides of the market. We even have
to take advantage of the transition in the Huitrón, adding that the notes will focus clients approaching us to package digital
rates space from LIBOR to SOFR which on the short term. options for them.”

www.structuredretailproducts.com 13
 NEWS | AMERICAS

MSCI deploys real time macro data in new

‘allocator’ play
Alternative data specialist QuantCube Technology has partnered with MSCI to integrate its real time
macro-economic data into the new MSCI Economic Regime Allocator Index.

exposures based on a pre-determined set and QuantCube, recorded over a 10-year

of rules. The index works on the premise period from October 2012 to February
that financial markets generally go through 2023, the new index demonstrated
different cycles or phases, and during annualised returns of 11.04% versus a
these cycles, different types of assets or benchmark return rate of 5.83%.
stocks tend to perform differently.
The benchmark was based on allocating
To match this behaviour, the index 60% of assets to the MSCI World index and
allocates assets to different market 40% to USA treasuries. Additionally, looking
subsets based on the current economic at the most recent 1-year performance
regime. As the economy moves from one of the new index, it showed annualized
regime to another the assets in the index returns of +0.8% versus a negative return
are rotated and reallocated with the aim of -8.59% for the benchmark.
of maximising investment performance.
‘Though future returns can never be
The definition of the four different guaranteed, the simulations we’ve
The new series include US and world economic regimes – stagflation, heating conducted with MSCI to demonstrate
versions as well as optimised risk up, slow growth and goldilocks – are the projected annualized returns versus
control options of five and 10% aimed at based on the rate of change of GDP and the benchmark shows the value to be
structured products. CPI indicators and whether these are gained by allocating assets based on
rising or falling. the economic regime,’ said Thanh-Long
The MSCI Economic Regime Allocator Huynh (pictured), CEO and co- founder,
Index allocates assets into different Based on historical market data from MSCI QuantCube Technology.

GeoWealth Partners plugs-in Halo

has announced a new partnership with ‘We foresee a rising demand for
Halo Investing. structured notes and hedged equity
strategies in the years ahead, and by
Under the terms of the agreement, joining forces with GeoWealth, we are
GeoWealth will have access to equipping RIAs with tools and capabilities
Halo’s platform to offer customisable to stay ahead of this growing market
structured note portfolios as a trend by incorporating notes into models,’
component of a Unified Managed said Radgowski.
Account (UMA).
‘We believe advisors are looking for
Matt Radgowski (pictured), chief increasingly diverse solutions to meet
executive officer at Halo, said that RIAs the goals of their clients,’ said Colin Falls,
that take advantage of this partnership president and CEO at GeoWealth.
and incorporate structured notes into
UMAs will be able to view, report and ‘[We are] squarely focused on providing
bill at the individual sleeve level, made RIAs new tools and product choice in
GeoWealth, a proprietary technology possible by GeoWealth’s proprietary constructing and maintaining model
and asset management platform (TAMP), sub-accounting software. portfolios on behalf of their clients.’

14 www.structuredretailproducts.com
 NEWS | AMERICAS

Canada regulator seeks margin Innovator deploys first

rules for structured notes ‘defined protection’ ETF

The Canadian Investment Regulatory Organization (CIRO) is reviving Defined Outcome ETF provider
Innovator Capital Management
a proposal by the Investment Industry Regulatory Organization of
(Innovator) has expanded its
Canada (IIROC) aimed at providing clarity on margin requirements product range with the launch of
for structured products such as principal-protected notes (PPNs). the Equity Defined Protection
ETF (TJUL) - a first-of-its-kind
The self-regulatory organization (SRO) challenges for the issuer to create a viable ETF designed to replicate the
is seeking comment on proposed rule structured product that can be sustained for upside return of the SPDR S&P
changes first tabled by IIROC in 2021 the full term to maturity,’ stated the SRO. 500 ETF Trust (SPY) with a
(Notice 21-0032) regarding proposed 16.62% cap, and a 100%
amendments to the Dealer Member Rules CIRO also noted that a 50% margin rate protection buffer against any
and IIROC Rules that would allow margining for PARs is ‘similar to other products with losses incurred by the ETF over its
of structured products that meet certain limited or low liquidity such as bonds in two-year investment period.
eligibility requirements. default, preferred shares and thinly traded
listed securities’ and that ‘the majority of Investors in the US have
In its initial proposal, the regulator sought PARs (approx. 91%) issued in the past five embraced structured ETFs
to introduce a fixed margin rate of 70% for years are based on the performance of a replicating the payoff profile of
structured products, or to allow firms to use portfolio of underlying securities that have a structured notes - Innovator’s
an alternative methodology for products margin rate of 30%’. suite defined outcome ETFs has
with principal protection features. Now, in over US$13 billion in AUM.
response to criticism that the 70% rate was Further, CIRO stated that margin eligibility
too conservative, the new SRO’s proposals criteria included in the proposals is With this strategy, Innovator
would allow for a 30% rate for PPNs and a ‘designed to address additional liquidity and hopes to help investors shift
50% rate for principal-at-risk notes (PARs). credit risk concerns’. their portfolios for downside
risk, without having to sacrifice
On 1 January, 2023, the board of directors The SRO added that a lower margin rate equity market exposure by
of CIRO approved the adoption of the 2021 for PPNs was appropriate ‘to recognize moving to cash, according to
proposed amendments to the Investment the lower risk associated with PPNs due Graham Day, chief investment
Dealer and Partially Consolidated Rules to the zero-coupon bond component that officer at Innovator.
(IDPC Rules). provides the principal protection’.
‘We continue to hear that
The main purpose of the proposed CIRO said the proposals will improve the investors are looking for a way
amendments is to set a margin consistency and transparency of margin to get back into the market
methodology for structured products which requirements for structured products. without sitting on the sidelines,
considers the different risk profiles of the but that the level of risk is simply
two main structured product types. The revised approach aims to ‘set margin too high,’ said Day. ‘Our aim is
requirements that consider the differences for [the new ETF] to provide a
However, in response to feedback on in risk between PPNs and PARs and the risk way for our clients to stay in the
that proposal, the SRO carried out further profile of the structured products compared market with significant built-in risk
analysis, including a review of the underlying to the underlying securities they track’, CIRO management.’
securities typically used in PARs. The review said in a notice outlining the proposals.
found that the underlying securities of Day also noted that unlike fixed
structured notes are typically comprised The notice added that the 70% rate indexed annuities and market-
of ‘highly liquid securities with low levels of proposed in 2021 “was based on a 50% linked certificates of deposit, the
volatility which allow the issuer to create margin rate plus a 20% margin rate premium new ETF is expected to provide
structured products that offer a variety of to cover increased liquidity risk.” investors ‘a beneficial 1099 tax
features to limit upside and downside risks’. treatment’.
The deadline for submissions is 18
‘Highly-volatile and low-capitalized September. CIRO intends to make the Innovator ETFs are distributed by
underlying securities are not usually proposed amendments effective within Foreside Fund Services.
considered for inclusion in structured 90 days after approval from the national
products as the high volatility creates regulators.

www.structuredretailproducts.com 15
 NEWS | AMERICAS

BMO debuts leverage/inverse ETN range

The Canadian bank is expanding its footprint in the US market.

The Prime Airlines index which has filings, industry classification, and other
been developed by financial research related material.
publisher Prime Indexes, tracks the
performance of US-listed companies The Canadian bank has also listed
that are engaged in the broader airlines two new MAX ETNs linked to the
industry ecosystem. performance of the Prime Auto Industry
Index - the MAX Auto Industry 3x
Leveraged ETNs and MAX Auto Industry
-3x Inverse Leveraged ETNs which are
available for trading on NYSE Arca.

MAX is the The Prime Auto Industry index tracks the

performance of US-listed companies
leveraged that are engaged in the broader auto
industry ecosystem.

and inverse Each index constituent must

BMO has launched MAX, a new leverage leveraged ETN be classified as an automobile
manufacturer, an automotive parts and
and inverse exchange traded notes (ETNs)
range targeted at sophisticated investors brand of BMO retail company, a new car dealer, or a
used car dealer, based on the Index
seeking tactical leveraged exposure to constituent issuer’s regulatory filings,
stocks in specific market sectors. industry classification, and other related
material.
The first two MAX ETNs - the MAX Each index constituent must be
Airlines 3x Leveraged ETNs and MAX classified as an airline, as aircraft parts MAX is the leveraged and inverse
Airlines -3x Inverse Leveraged ETNs and manufacturing company, or an leveraged ETN brand of BMO which falls
which are available on NYSE Arca - are air freight and logistics company, as under the responsibility of Laurence
linked to the performance of the Prime determined by Prime Indexes, based on Kaplan (pictured), managing director,
Airlines Index. the index constituent issuer’s regulatory BMO Capital Markets.

Cboe, S&PDJI partner to launch new credit VIX

Cboe Global Markets and S&P The new indices include the CDX/Cboe hedging strategies,’ said Rob Hocking,
Dow Jones Indices (S&P DJI) have NA High Yield 1-Month Volatility Index senior vice president and head of
announced the launch of four new credit (ticker symbol: VIXHY); CDX/Cboe NA product innovation at Cboe.
volatility indices (Credit VIX) to provide a Investment Grade 1-Month Volatility
VIX Index-like measure for credit market Index (VIXIG); iTraxx/Cboe Europe Main ‘The Credit VIX Indices are expected
volatility. 1-Month Volatility Index (VIXIE); and to provide new clear signals on bond
iTraxx/Cboe Europe Crossover 1-Month market sentiment, and act as a new
This new series of indices, jointly Volatility Index (VIXXO). barometer of corporate credit risk in
developed by Cboe Labs, Cboe’s product North America and Europe,’ said Frans
innovation hub, and S&P DJI, are based on ‘Interest in this asset class continues to Scheepers, head of fixed income,
Cboe's proprietary VIX Index methodology grow amidst a rising rate environment, currency and commodity products at
and S&P DJI's CDX and iTraxx Indices and and we expect these indices will help S&P Dow Jones Indices. Cboe's planned
aim to track the expected level of volatility investors better track credit market launch of the new Credit VIX Indices
across the North American and European volatility, manage corporate credit risk, adds to its suite of option-implied
credit markets. or implement yield-enhancement and volatility indices.

16 www.structuredretailproducts.com
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 NEWS | APAC

FSS: HSCEI-linked ELS approaching loss

territory
The volatility of HSCEI has been increasing due to ‘the slowdown in the Chinese real estate market and
deepening uncertainty in the Chinese economy’.

continue to monitor the risk from HSCEI- such as stock indexes’ that pushed coupon
tied structured products. rates for DLS higher, the FSS stated.

In the report, the regulator noted that Compared to H1 2022, when the market
the volatility of HSCEI, which comprises struggled because of Russia’s war in
the largest and most liquid 50 Chinese Ukraine and interest rate hikes, the
securities listed in Hong Kong SAR, surprising rally seen in the global stock
has spiked due to ‘the slowdown in market this year encouraged the early
the Chinese real estate market and repayment, the regulator stated.
deepening uncertainty in the Chinese
economy’. In fact, the repayment amount has
exceeded the issuance amount.
As of 30 June, the HSCEI stood at During H1 2023, there was KRW31.2
6,424.88 points, down 6% year-to-date. trillion worth of DLS issued, while the
redemption amount collected KRW35.5
Meanwhile, the FSS also stressed the trillion, according to the report.
increasing need to manage foreign
The balance of structured products currency liquidity rather than ELS’ In the first six months of the year, ELS
reaching their knock-in level in South margin calls for securities companies, and DLS issuance reached KRW66
Korea reached KRW7 trillion (US$5.3 driven by the growing scale of their trillion and KRW30.3 trillion. The
billion) in the first half of the year – all own ELS self-hedging, and recent combined amount was down from the
of which came from equity-linked uncertainty in domestic and foreign KRW102.2 trillion in H2 2022 but up
securities (ELS) mostly tied to the Hang financial markets. from H1 2022, which saw KRW95 trillion.
Seng China Enterprises Index (HSCEI),
according to the Financial Supervisory Additionally, the financial watchdog
Service (FSS). Market rally becomes a noted that issuance of principal-
booster payment ELS tumbled by 75%
According to the FSS report, more compared to H2 2022, recording
than 85% of the balance, around KRW6 For investors, investment returns from KRW5.9 trillion in H1 2023. The FSS
trillion, will be matured in the first half ELS and derivative-linked securities attributed the drop to the concentrated
of next year, as the performance of (DLS) increased to 6.4% and 2.9% pa, demand for retirement pension inclusion
HSCEI continues to weaken, the Korean respectively, during H1 2023 (H1 2022: at the end of 2022, while H1 2022 saw a
financial watchdog warned. 3.5% and 2.2%, respectively), according similar level, reaching KRW5.5 trillion.
to the report.
The regulator said the risk of investor According to the report, issuance of
loss may increase due to the The rising figures were driven by the knock-in ELS was KRW6.9 trillion, down
fluctuations of the HSCEI and said it will ‘increased volatility of underlying assets from KRW8 trillion in H1 2022.

Increased volatility of underlying assets such

as equity indexes have pushed coupon rates

18 www.structuredretailproducts.com
 NEWS | APAC

StanChart adds automated module for

structured notes in HK
The UK bank is seeking to transact 90% of its trading volume through the digital platform
following the launch.

bank has seen a 400% year-on-year (YoY) different markets such as Hong Kong
increase in the number of tranches traded and the US.
and a 600% YoY rise in profit and loss
during the first quarter of 2023. “Clients are benefiting from high and
competitive deposit interest rates and
Launched as an open architecture of are seeking more yield enhancement
structured product electronic platform solutions,” he said.
for equity-linked investments (ELI) in
2018, SCB’s digital platform has gained “In addition, given market uncertainties,
traction with transactions up 70% year- clients are also looking for investment
on-year (YoY) during its first year and solutions that provide a minimum
two times increase the following year, redemption of their investment amount,”
according to Ho. he continued. “We see this trend
continuing for as long as the interest rate
“An entire equity structured product environment [continues] to remain high.”
transaction can now be completed under
10 minutes,” he said. “The platform has SCB has been navigating its slow recovery,
Standard Chartered Bank (SCB) has enabled us to remove some operational including its wealth management business
unveiled a new module enabling end- bottleneck due to heavy manual segment, as the Asia-Pacific-focused bank
to-end automation for its structured processes, which in return saves time for saw its rebound in some key markets such
notes offering targeting Hong Kong clients and provides them with a better as Hong Kong and China this year.
SAR’s professional investors as the experience.”
bank expands its franchise in this client Yet, in Hong Kong, data from the
segment. SCB’s latest development in Hong Kong Securities and Futures Commission (SFC)
SAR came after last year’s performance showed that ELI’s net notional outstanding
The new features were added to help which saw the bank becoming the first increased to HK$15.8 billion (US$2 billion)
relationship managers focus on wealth distributor bank to bring US equity ELI into by the end of this July, up from HK$13.7
planning and reduce their administrative the city offering the open architecture billion by the end of July 2022.
workload, an SCB spokesperson said, pricing and order placement platform.
adding: “They are now able to deliver Looking ahead, the UK bank wants over
quality advice and product ideations 90% of its trading volume done through
quicker and consistently to clients.” Recovery signs the digital platform as it continues
digitising its product offering and platform,
The module also allows real-time pre- According to Ho, the platform’s new including structured product business,
trade credit checks and straight-through development also coincided with the which “is part of the strategy over the next
processing steps across operations, risk broader market recovery signs in the last six to 18 months”.
and regulatory reporting platform. 18 months which resulted in a “better
equity market performance for the first “Structured products are becoming more
Launched in January, the bank’s half of this year” with a 160% YoY increase important as an alternative investment
electronic structured product platform in ELI volume between H2 2022 to H1 choice for clients besides cash equities
consists of fully automated pricing and the 2023, according to Ho. The bank also saw transactions,” said Ho.
making of indicative trade documentation a 2.4 times YoY increase in the number
instead of relying on issuers’ generation, of tranches launched in H1 2023 for the The bank is also looking to “work towards
the spokesperson told SRP. “related payoff”, he added. mobile capability’ and improve “the
capability in the post-trade lifecycle
Alson Ho (pictured), head of wealth Speaking of the recent market management and notifications in a timely
management for Hong Kong at SCB, environment, Ho noted more clients are fashion” as its next scope for growth,
highlighted that since the launch, the willing to diversify their exposure across concluded the SCB spokesperson.

www.structuredretailproducts.com 19
 NEWS | APAC

SG lists Asia’s first structured certificate

in Singapore
Société Générale (SG) has partnered with the Singapore Exchange (SGX) to launch the first-ever
autocallable structured certificates in Asia.
classified by SGX, will be launched in regular in Europe, although using single stocks as
series and open to eligible investors for underlying assets while European clients
subscription via distributors. invest also on structured products on
indices and with longer tenors,” she said.
The range will be expanded with other
yield enhancement certificates - discount “This activity in Europe has reached a
certificates and barrier discount certificates mature and industrialised stage with a
- as well as participation certificates very diverse product offering and we hope
- outperformance certificates, barrier to build a similar offer in Asia to have our
outperformance certificates and digital Asian clients fully benefit from our strong
participation certificates, according to SGX. capabilities and long experience gathered
in Europe.”
The new products are the French
bank’s response to investor demand for Specifically, the autocallable structured
The first batch to be available for trading diversification and market access, as well as certificates are a subset of ‘express
will be autocallable structured certificates ‘more transparency and liquidity’ to support certificates’, which’re listed predominantly in
linked to the Hong Kong shares of Alibaba customers’ investment strategies amidst Germany, said Chen.
with a one-year maturity. United Overseas Changing market conditions, said Olivia
Bank (UOB) and its sister company UOB Kay Chen (pictured), head of distribution sales in There’s little discussion about the launch
Hian, a brokerage firm also headquartered in Southeast Asia and Australia at SG. of structured certificates in Hong Kong
Singapore, will be the primary distributors of SAR, a main competing listing venue for
the new certificates. In Singapore, the existing listed structured Singapore, a trader of DWs and CBBCs at an
products comprise structured warrants investment bank told SRP.
The new capital-at-risk products offer and daily leverage certificates (DLCs) – SG
investors a predefined enhanced yield and Macquarie Bank are the issuers of the “Asian retail investors love leveraged
as long as certain conditions are fulfilled, former while the French bank is the sole products. Inline warrants and equity-
according to SG. If the underlying stock issuer of the latter. SG is also an active linked investments (ELIs) have failed to
rises above a certain upper threshold, the player in the derivative warrants (DWs) and gain traction in the listed segment,” said
autocallable certificates will trigger an early callable bull/bear certificates (CBBCs) space the source, adding that DLC, which offers
redemption feature, but if it falls below in Hong Kong SAR. a leverage of 2x to 7x on SGX, has the
a certain lower threshold, investors will potential to become a new product, but
receive physical delivery of the underlying Chen noted that structured certificates the introduction has been partly hindered
shares at expiry. differ from the instruments above as they by its similarity with the existing leveraged
consist of mainly investment products with exchange-traded funds (ETFs) in Hong
‘Investors’ appetite for listed structured no leverage. Kong SAR.
products has grown and there is strong
demand for more options that offer both “Autocallable certificates are designed for Year-to-date, Germany has seen the listing
risk management and enhanced returns,’ investors who believe that the performance of 5,503 express certificates in Frankfurt or
said Michael Syn, senior managing director of the underlying asset will be range Stuttgart, 112 of which are marketed by SG.
and head of equities at SGX. bound over the term of the product and The top three issuers are Landesbank BW
are seeking an enhanced yield on their (1,865 products), DekaBank (1,071) and DZ
‘As our customers become increasingly investments subject to the fulfilment of Bank (737), according to SRP data.
sophisticated, structured certificates will certain conditions, with the possibility of
bring a new dimension to our diverse suite early expiry of the product,” she added. Meanwhile, SG has been the largest
of products and enable investors to capture issuer of open-end turbo certificates
more opportunities in today’s dynamic The project started before 2020, according listed in Frankfurt and Stuttgart on back of
markets,’ said Syn. to Chen. “The autocallable structured 321,199 issuance year-to-date, followed
certificates listed on SGX are inspired from by J.P. Morgan (315,405) and BNP Paribas
The specified investment product (SIP), as the commonly traded structured products (277,509).

20 www.structuredretailproducts.com
 NEWS | APAC

EAM Hywin launches megatrends suite

on Leonteq indices
The structured notes offer exposure to five megatrends through Leonteq’s indices and one ETF as
Hywin International continues its thematic push.
fund that invests in the structured notes The product is tied to the Leonteq
with a minimum ticket size of US$200,000. Defense & Security 12%RC Index, which
invests in a basket of 20 stocks selected
Electric vehicle (EV) markets are seeing from either the defence or cyber security
exponential growth globally, exceeding sectors. Annualised volatility is capped at
over 10 million sales in 2022, according 12% and there’s synthetic dividend at one
to Hywin, citing data from the International percent, according to Leonteq.
Energy Agency.
The top constituents of this decrement
For the ‘electric champion’, the structured index were the US dollar (9.7%),
note is linked to the Leonteq Electric CrowdStrike (6.1%) and BAE Systems
Vehicles 11%Risk Control (RC) Index, (5.6%) as of 4 August.
which aims to give exposure to the
companies involved in the production of In the meantime, the ‘American titans’
Introduced on 4 August, the ‘global EV, including all elements of the supply are the reference assets of the Leonteq
mega-trends’ series offers 100% capital chain. It derives from the Morningstar US Quality 10%RC Index. The US listed
protection with upside participation. Developed Markets Electric and securities are selected based on their
Targeting high-net-worth individuals Autonomous Vehicles 30 Index. The top high-quality metrics. Each quarter, all the
(HNWIs) in Asia, they are available for index constituents were Euro (46.9%), stocks in the starting universe (500 of the
clients at Hywin International as well as Renesas Electronics (3.8%), Tesla (2.8%) largest US listed stocks) are given a score
Arta TechFin, a fintech platform that acts as of 4 August, according to Leonteq. according to their profitability and asset
as the third-party distributor. growth.
The ‘AI architects’ tracks the performance
This latest development is ‘a continuation of the Leonteq Metaverse Equity 15%RC ‘The U.S. corporate sector has maintained
of [Hywin, Leonteq and Arta's] product Index, designed to cover the stocks of resilient growth in recent years and
issuance program launched in April 2023’, companies predicted to play a leading role navigated the impact of inflation and
according to the Hong Kong external asset in the expansion of the Metaverse. monetary tightening quite well,’ stated
manager (EAM) owned by China’s Hywin Hywin. ‘Large-cap companies have
Wealth Management listed on Nasdaq. ‘In the AI revolution, leading chip makers performed with particular strength in
and the global semiconductor value earnings and share prices, supported
Leonteq Securities is the issuer of the chain will continue to reap tremendous by their innovative leadership, global
structured notes, which require a minimum commercial gains, while more companies customer base and pricing power.’
ticket of US$50,000. The products cover will also benefit from the innovations and
the themes of ‘electric champions’, ‘AI cost efficiencies made possible by AI,’ SRP has 86 structured products tracking
architects’, ‘peace engineers’, ‘American stated Hywin. a group of 19 indices developed by
titans’ and ‘Nikkei renaissance’. Leonteq across Sweden (64), Italy (17), the
The US dollar (25.2%), Nvidia (9.1%) Czech Republic (two), Finland (two) and
“All the themes are outcomes of careful and Amazon (7.8%) were the top index Switzerland (one). The activities are driven
assessment of long-term trends and constituents as of 4 August. by the Leonteq Mixed Allocation Funds
calibration of product parameters. We 7% RC Index and the Leonteq European
expect them to be evergreen thematics, The ‘peace engineers’ is designed to High Yield Bonds 4% RC Index.
with continuous and tranche-based cash in on rising order flows of defence
inflows, along with the global healthcare contractors in US and Europe in the The last product is linked to the Nomura
principal-protected-note launched in coming years. Nikkei 225 ETF as corporate governance
April,” Nick Xiao (pictured), CEO of Hywin reforms, low interest rates, return of
International, told SRP. ‘The global race in defence budgets and inflation, and accelerating global supply
procurements is intensifying, dwarfing chain relocation are powering the growth
The EAM has also introduced the Hywin the decades since end of the Cold War,’ of the Japanese corporate sector,
Global Mega-Trends Fund SP, a Cayman stated Hywin. according to Hywin.

www.structuredretailproducts.com 21
 NEWS | APAC

SRP Apac Awards 2023: Murex

capitalises on regulatory changes
The French company won the Best Pricing and Risk Analytics accolade at the SRP Apac Awards 2023
for its ability to capture opportunities arising from regulatory shifts in multiple markets.

Typically, the structured deposits are

principal-protected and bullet style
with variable coupon rates based on
the underlying performance
Fanchao Zeng

In the structured product space, At Murex, the MX.3 platform is designed Taiwan, India, Australia, Hong Kong
China has experienced a reform since to integrate cross-asset trading, risk SAR, Singapore, South Korea, Malaysia,
the release of several regulations on and post-trade operations. In China, it Thailand as well as Brunei and Indonesia.
standardising structured deposits and enables the banks to comply with both
wealth management products in 2019. domestic and international requirements The client group covers nearly 400
like the fundamental review of the desks by asset class, which comprise
“With the increasing demand and trading book (FRTB) and the standard FX option, interest rate, FX cash, fixed
popularity of structured deposits in initial margin model (SIMM) based on income, securities finance, equity,
the Chinese market in recent years, a best-practice framework set up by commodity and credit derivative.
local regulators have required banks Murex, according to Zeng.
to establish a proper risk management For the structured products priced on
system,” Fanchao Zeng (pictured), “Typically, the structured deposits are MX.3, the activities are driven by non-
product manager, structuring and principal-protected and bullet style with linear risk-free-rate (RFR) structures,
analytics, Apac, told SRP. “The legacy variable coupon rates based on the China’s structured deposits, equity
systems at some banks failed to price or underlying performance,” he said. autocall and FX exotics, which are
handle complex structures. That’s how supported by 30 cross-asset structured
Murex began to play a role by offering Among a total of 25 payoffs, the top product specialists and six quant
both pricing and risk warehousing.” picks are call or put spread, staircase, analysts at Murex in Asia.
shark fin, range accruals and autocall
He cited China Minsheng Bank (Minsheng), across foreign exchange (FX), precious “Across Asia, clients with large
a client of Murex for more than a decade, metal, commodity, rate and equity. derivatives portfolios use MX.3 LiveBook
which owned CNY7.6 trillion (US$1.1 to get full intraday visibility on their risk
billion) assets as at the end of March. The project has helped Minsheng and hedging,” said Alexandre Bon, head
streamline trading operations and of marketing, presales & go-to-market,
Last October, the Beijing-headquartered consolidate market risk control, Apac.
bank went live with the structured according to Li Jingwei, senior manager,
trade builder supported by MX.3 for market risk at the bank. The module aims to provide traders
its derivatives and structured deposits instantaneous access to personalised
following a nine-month preparation. In Asia Pacific (Apac), approximately 70 monitoring dashboards of their
The structuring tool allows Minsheng to financial institutions — mainly banks and positions, including sensitivities and
create linear combinations of payoffs securities houses — use Murex’s front- user-defined risk measures with live
and package them in a few clicks. to-risk solutions across Japan, China, position and market data updates.

22 www.structuredretailproducts.com
 NEWS | APAC

From Libor to RFRs Moreover, the system must provide real- Specifically, the banks choose to issue
Bon noted that the Libor discontinuation time portfolio management capabilities a structured note and fully hedge the
is also driving banks’ infrastructure to support risk scenarios like spot ladder exotic payoff by buying the mirroring
investments in Asia as new products and smile analysis for large FX structure derivatives structure from a global bank.
need to be packaged using RFRs, books in a timely manager.
bringing new complexities. “This let [the banks] scoop a margin and
In response, a new stochastic local leave their portfolio flat from a market
“In Asia, some of our Japanese volatility (SLV) model – TStar – was risk perspective and they don’t need
customers were the first to invest developed by Murex’s quant analysts have the valuation capabilities from a
in developing non-linear and exotic based on its proprietary Tremor SLV narrow sales, trading and market risk
structures using daily compounded model, which demonstrates “a more management perspective,” he said.
secured overnight interest rate (Sofr) stable bucketed volatility risk [vega,
and Tokyo overnight average rate vanna and volga] and more consistency However, the risk remains with both
(Tona),” said Bon. with smile analysis”, according to Zeng. the bank and its counterparty and their
exposures are determined by the value
The adoption was shortly followed by The LiveBook module has also been of each leg of the mirroring positions.
Australia and Singapore before spanning applied by some derivative desks in
the entire Apac region. Japan to access risk results of large FX Collateral management is one way
structures book and monitor real-time to mitigate this risk, but the regular
“The market for RFR-based structures is position and market data update. exchange of collateral requires that
still growing and will remain an important parties value the underlying positions,
driver for our risk and analytics solutions The SLV model will continue to according to Bon.
for at least another two years in the be improved with a focus on the
region,” he said. performance of model calibration “The small banks which did not have the
through a hybrid graphics processing valuations capabilities implemented our
units (GPU) and central processing units solutions with the SIMM and FRTB use
Exotics in Japan (CPU) architecture. cases in minds,” he said.
In Japan, FX-linked barrier products
with a tenor of over 10 years are well For larger players, all these new
received and deliver significant volume. UMR regulations represent additional friction
According to Bon, Basel III’s initial margin costs for their structured products
“The inconsistency between the market requirement (UMR) framework, which businesses, which has motivated them
quote FX forward and historically- aims to reduce the risk of derivatives to move away from the plain back-to-
realised spot rate gives rise to the exposures, also impacts the Apac back model.
long-dated FX structures,” Zeng said. market.
“It requires a market standard model “All these developments prompted a
which can match the market price of the “For long, many small-to-medium-sized number of banks in the region to work
exotics while at the same time perfectly banks had been offering structured with Murex to invest in risk and pricing
matches the FX vanilla market quotes for products to their clients on a ‘back-to- capabilities for structured products,”
up to 10 years.” back’ basis across Apac,” said Bon. said Bon.

For long, many small-to-medium-

sized banks had been offering
structured products to their clients on
a ‘back-to-back’ basis across Apac
Alexandre Bon

www.structuredretailproducts.com 23
 FEATURE | APAC

Feature: crypto structured products fuel

market in post-2022 tumble
From new product launches to risk management, industry players share their latest observations on
structured products in the digital asset space in 2023.

A new era for cryptocurrency structured products with crypto underlyings". The firm city as well as modernise its licensing
investment products is filled with hopes to secure an official licence in Hong regime for the digital assets industry,”
innovation and challenges – in Asia Kong by the end of the year. said Wang. “All this is very conducive to
in particular - as the industry slowly institutional investors to build a business
emerges from last year’s turbulence. “We’d love to see the regulators in Hong here in Hong Kong with confidence
Kong open up to the idea of crypto and certainly beneficial for our crypto-
In Hong Kong SAR, Bank of China banking to allow on/off ramping, crypto structured business here.”
International and UBS partnered to be collateralised lending and finances from
the first to issue tokenised notes in the banks in Hong Kong to continue to
jurisdiction in June. Last month, Swiss supplement the whole crypto/financial Crumbling out of the 2022
crypto-focused SEBA Bank’s subsidiary, ecosystem in Hong Kong,” he said. tumble
SEBA Bank Hong Kong Limited, received
approval in principle from the Securities Crytpo wealth manager Following last year’s
and Futures Commission (SFC) to has also seen growing rollercoaster-like
become the first group of licensed demand for adoption and cryptocurrency
corporations to conduct investment acceptance of crypto market, one major
services with crypto capabilities in that derivatives products by shift in thought among
market, including plans to build and institutions, with regular market participants
expand its product suite once licensed. inquiries from family is risk management
offices, trading institutions, and private – from market risk and liquidity risk to
Ludovic Shum, equity into its hedging services, said CEO counterparty credit risk and legal risk,
managing director at Adrian Wang. according to Caroline Mauron, co-
SEBA HK, told SRP that founder of OrBit Markets, a Singapore-
with initial assessing and In April, Metalpha launched a licensed based institutional liquidity provider of
focus on the existing fund in Hong Kong SAR that gives crypto options and structured derivatives.
products issued by investors exposure to Grayscale's digital
its Swiss head office, asset products. She told SRP that crypto investors have
the firm’s product suite will consist of adopted more realistic return targets
traditional investments such as “equities, “Ever since the declaration of building after the collapse of Terra-Luna last year.
fixed income and the cash and money- a Web3 hub last year, the Hong Kong
market instruments as well as over-the- government has moved swiftly to “Investors no longer aim at 100x or 10x,
counter [OTC] derivatives and structured promote blockchain technology in the instead they turn to more traditional

Investors no longer aim at 100x or 10x, instead they turn

to more traditional sources of yields such as structured
derivatives
Caroline Mauron, OrBit Markets

24 www.structuredretailproducts.com
 FEATURE | APAC

sources of yields such as structured Opportunities and challenges use crypto structured products to help
derivatives,” she said. “After an initial are side by side investors preserve wealth in a risk-
slump post-FTX, the market bounced adjusted manner. The ongoing challenge
from the low in Q1 this year and has since Still, innovation in the crypto structured remains at the pricing aspect, including
been very stable. Structured derivatives products space is still traceable among the principal protection issue.
have performed very well in this market native players. Crypto exchange OKX
environment.” rolled out snowball and sharkfin products “In the crypto industry, [let's say] my
this year, while Ribbon Finance, the US dollars become stablecoin. That
Meanwhile, many investors, especially in decentralised derivatives platform built stablecoin is guaranteed by a corporate;
Asia, started the year on the front foot, on Ethereum which has rebranded to they are not paying your corporate yield
taking advantage of bespoke structured Aeve, executed the first Ether autocall. on it,” he explained. “So I[the corporate]
payoffs to build positions. would have to get some kind of yield...but
“Moving in the right there's no credit market in crypto.
Mauron, who served as former co- direction” is how Lucas
head of FX for Apac at Deutsche Bank, Kiely, chief investment “There's a lot of caution based on the
highlighted that accumulators have officer at digital wealth counterparty risk,” Kiely added.
gained traction among crypto asset platform Yield App,
managers this year as “an attractive would describe the OrBit Markets’ Mauron said although
alternative to dollar cost averaging crypto structured the crypto structured products market
[DCA] strategies, in particular in products industry in 2023. is currently in its early stages of
alternative tokens” as they allow development, the potential for crypto-
investors to accumulate the tokens at a Earlier this year, the firm acquired linked securitised products is significant.
discounted price. structured product provider TroFi Group
in response to growing demand for “Streamlining the process requires
“This year’s range-bound market has enhanced yield investment opportunities. collaborative contributions from issuers,
created a perfect environment for The firm currently offers dual currency hedge providers, paying agents, custodians,
accumulators to outperform DCA,” she product. as well as banks,” she said. “There are
said. “The product fits well with the asset still some missing pieces, but we foresee
managers’ long-only mandate while Kiely, who came from a trading increased institutional interest in this field,
offering significant savings versus basic background at Credit Suisse and UBS, with more participants entering the space to
strategies.” has been thinking about how to best collectively piece together the puzzle.”

Structured products remain most prevalent product in HK SAR

A survey jointly conducted by the Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC)
shows that money market funds were the top-selling collective investment schemes (CIS) in 2022. However, according to the
survey, structured products remained the most prevalent type of products sold by the respondent firms during 2022, constituting
51% (US$1.9 billion) of the total transaction amount. CIS and debt securities followed, accounting for 23% (US$884 million) and
17% (US$648 million), respectively.

Equity-linked structured products remained predominant, representing 53% of all the structured products sold in 2022 –
according to the survey, some investors shifted to other product types such as currency-linked products owing to weak
sentiment in stock markets in 2022. On debt securities, some investors shifted their interest to sovereign bonds, such as HKSAR
Government Bonds including green bonds and silver bonds, which were perceived to be of lower risks with more stable returns.

The number of firms distributing investment products online increased to 83 in 2022, up 19% from 2021. CIS remained the most
common product type distributed through online platforms, which represented 83% of total online sales.

Of all CIS investors, the proportion of investors transacting online also increased from 65% in 2021 to 72% in 2022. Notably,
online sales of debt securities increased significantly to 15% of the total online sales in 2022 from 6% in 2021. The survey was
designed to collect information about the types and value of investment products sold.

‘The information collected helps the SFC and HKMA better understand market trends, identify risks associated with the selling
activities of intermediaries and coordinate their responses to address areas of common concern,’ said the HKMA in a statement.

www.structuredretailproducts.com 25
 SRP AMERICAS

SRP Americas Annuities PoY 2023:

Marie-Laure Chandumont
The head of insurance, cross-asset derivatives solutions at Barclays is the recipient of this year’s SRP
Americas Personality of the Year (PoY) Annuities award, after securing the most votes from market
participants in the SRP Americas 2023 survey.

Chandumont, head of insurance, cross- I think FIAs are as great instrument for
asset derivatives solutions at Barclays, people preparing for retirement.”
started her career at Société Générale
as an investment bank analyst for six Chandumont’s remarks coincided with
years and moved to her later role as vice broader industry trends as registered
president, equity derivatives before joining index-linked annuity (Rila) and FIA set new
the UK bank in 2010. sales records in the second quarter of
this year, as Limra’s US Individual Annuity
She has been responsible for covering Sales Survey showed.
insurance companies in North America
with the cross-asset derivatives team Indices offering
of Barclays since, including working
with institutions to manage their risks, Chandumont highlighted that as of 23
providing industry content and insights September, the Shiller Barclays Cape (no
to clients, and delivering performance to vol control) had gained 16% year-to-date,
policyholders through its indices. driven by the sectors selected by the
index, while the rally of the US tech stock
Industry partnerships market has pushed the Barclays US Tech
After 25 years of working in the industry, 12% index higher, up 14.8% in 2023 so far.
Marie-Laure Chandumont (pictured) Following the post-2008 financial crisis
described planning for retirement for where many insurance companies She cited that Barclays hedged US$15
many as an often “boring and daunting suffered from market turmoil, billion of its proprietary indices in 2022, as
decision” with very few sitting down with Chandumont saw the opportunities per schedule DB statutory filings.
their partners to devise a plan for their to partner with these manufacturing
years 60 to 100. companies and help them design the Speaking of the growing indexed
product instead of coming on the back annuities linked to multi-asset quantitative
“It’s like marriage: you date a few people, end and just hedging the liabilities. investment strategies (QIS), she noted the
and then boom, you commit to someone ultimate goal for QIS is to increase risk-
for maybe 70 years – the most important “With volatility-controlled indices, the bank adjusted returns.
decision of your life has so many can better manage the cost of goods
consequences on your health, wealth, sold,” she said. “The S&P and Nasdaq have the strongest
happiness - everything,” she told SRP. rallies, but the participation rates for
Last year, the UK bank rolled out the these indices are very low and extremely
But that’s also what’s been motivating her Avantis Barclays Volatility Control (VC) volatile,” she said. “Maybe this year you
throughout her career: creating strategies Index in collaboration with Avantis will have 40% participation rates and
to simplify these planning processes. Investors specifically for the fixed indexed next year 20%. With volatility-controlled
annuity (FIA) market. indices, the goal is to have higher risk-
“The idea that people can give a portion adjusted returns and stable renewals.”
of their savings to an institution, and the “When you buy a FIA, you outsource
institution will give you a paycheck for derivatives management to the insurance Looking forward, she sees the index
life – think of it as your base expenses, company and they give you a check annuity market will see more higher
your necessities, manage the risk and give for life, I think that is a great value volatility target indices as the interest
you a portion of equity market gains, that proposition,” she said. rates have risen. Meanwhile, some existing
obviously takes a lot of the stress away,” themes will persist such as intraday
she said. “As long as they're positioned properly, volatility and artificial intelligence.

26 www.structuredretailproducts.com
 SRP AMERICAS

SRP Americas 2023:

brighter days for the insurance industry
A group of five panellists discussed innovation and customisation in the RILA and FIA markets during
the SRP Americas 2023 Conference, held in Chicago on 27 September.

Excess returns, which are prevalent in us – whether it be intraday, new payoffs,

the fixed index annuity (FIA) space, are data. [We need to] incorporate that into
critical to the pricing, but also created a lot something that makes sense for the
of conversations with clients as interest consumer,” Heraty added.
rates have risen.
In the last three years, the economic
The discussion about excess return conditions have shifted drastically
is also seen at BlackRock where the from the period post-2018 financial
indexed annuities team has received many crisis, according to Stéphane Mattatia,
questions from clients this year. managing director, global head of
derivatives licensing and thematic
“Interest rates had always been zero. indexes, at MSCI.
Excess return just means all the benefits
but without any costs. Certainly this year, “Now everyone is convinced that we will
that's not the case,” said Igor Zamkovsky, have to tackle with high interest rates
head of indexed annuities, retirement global lead for rotation business cycle,”
insurance at BlackRock. he said.

Zamkovsky’s team spent a lot of time on Technology like natural language

both index and annuity education with a processing has brought tremendous new
At Lincoln Financial Group, customised focus on how the product sits alongside data, which investors want to understand
indices, which are its differentiator in the everything else in the portfolio with a its impact to their own portfolios.
registered index-linked annuity (RILA) holistic approach. Within the industry, the
market, have worked out really well, knowledge about excess return involving In addition, US retail investors have shown
according to Del Campbell (pictured), fees and trading costs is lacking, added higher interest in adopting new index
vice president, head of variable annuity Zamkovsky. mechanisms such as risk control, which
product development. is considered “very complex” in Europe,
A growing number of FIA players are particularly France.
“We leverage a couple of custom indices… entering the RILA space, leading to wider
[that] already existed in the retail world,” distribution by veterans. Kelsey Stokes, sales head, insurance at
said Campbell. “That made me feel good S&P Dow Jones Indices, stressed the
about having something in there that “Innovation is really hard,” he said. “Just greater precision of data, which brings
wasn't built for an insurance company.” because you could do it doesn’t mean greater ability for the use within indices.
that you should do it. So much of the value
Among their offerings, the First Trust of the RILA is the simplicity – in the buffer “From that perspective, more traditional
American Leadership Index has been made and the floor.” index provider realise that some really
available with the Lincoln Level Advantage excellent ideas have come from the
indexed variable annuity. The underlier is Mike Heraty, head of US solutions and banking space,” she said.
owned by FT Indexing Solutions. structured products, at RBC Capital
Markets, sees plenty of innovation in the With that evolution in technology and
In view of its early development in the market. “I think it’s bright days for the data, the data is observed beyond an
RILA market, Campbell highlighted the insurance industry infrastructure products intraday basis, she added.
importance of third-party distribution for industry in general,” he said.
the products. “Brand transparency and governance
“We think that we always have to challenge processes are critically important, as
“Having a lot of distribution helps go out to ourselves, not to overly engineer things, well as the actual nuts and bolts of the
people that we didn't know,” he said. but to really take what the market is giving index,” Stoke said.

www.structuredretailproducts.com 27
 SRP AMERICAS

SRP Americas 2023:

room for diversification in Canada
The market remains in good health with further room for underlying diversification.

structured notes and market-linked “There's an opportunity there because

guaranteed investment certificates (GICs). most of the market-linked GICs that were
sold have matured and are unavailable
These include the Solactive Canada Bank through structured notes,” said Bélanger.
40 AR Index (2,632 products), Solactive
Canada Pipelines AR Index (467), Solactive He also pointed at a higher concentration
Canada Insurance AR Index (425) and of autocallable products in Canada
Solactive Equal Weight Canada Banks 5% compared to the US, which leads to longer
AR Index (299). tenor of between five to seven years.

“From an exposure standpoint, there's “For more standard products, the averaged
definitely a huge home bias. Who doesn't tenor is just three to five years. With the
love a Canadian bank?” said Jerome interest rates increasing, [investment
Cloutier (pictured), managing director & co- terms] are getting shorter,” he added.
head global sales, global markets at BMO. “It
would be great if we could actually go and In Canada, the greatest opportunity
offer a lot more US and global products.” lies in the growth of the at-risk
platform through aucallable notes and
Canada’s structured products market Outside the US, Canadian banks are not discretionary portfolios, which is a
will continue growing as the increase in exactly global banks, which makes trading heavyweight for the advisor’s business,
interest rates will favour products with and risk management “a little bit more according to Cloutier.
capital protection. This will address the challenging”, according to Cloutier. He also
investment needs of investors with a noted that a lot of banks across the globe “The way you are running a discretionary
traditional risk-averse profile, according started factored in dividend risk well before portfolio, you have to have your model
to two Canadian bankers at the SRP in 2020 when the presence of decrement portfolio vetted by the dealer,” he said.
Americas 2023 Conference held in indices took off in the country. “The challenge and the opportunities for
Chicago on 27 September. our industry is to get in there and to be
“BMO went in hard on the decrement able to prove that a structured note is a
Despite the dominance of Solactive’s indices [after CIBC]. Pretty much every viable option for mitigating volatility and
indices in the Canadian market, Desjardins other issuer followed,” said Cloutier. increasing the yield of the portfolio.”
remains focused on its preference for
structured notes tracking share baskets, From a product type perspective, there One week ago, BMO revealed its
which are considered simple and secure, has been a shift towards fully protected partnership with Halo Investing with an aim
according to Benoit Bélanger, director, structures as suggested by the asset to help Canadian financial advisors manage
equity derivatives & structured products under management (AuM) of market-linked risk across wealth and retirement planning
at Desjardins. GICs which is at a comparable scale to that through direct access to Halo’s secure
of structured notes, making the former technology platform.
“The [Solactive indices-linked products] are worth being talked about, according to
pricing well and create a concentration on Bélanger. “We needed a dedicated platform to
some specific assets. I think there's room managing the lifecycle and the portfolio [of
for diversification for more and more global “[Market-linked GICs] were really easy to structured products], other than having a
exposure,” he said. sell in the past couple of years when rates like a 100% unitised solution,” said Cloutier,
on fixed term GICs were lower,” he said. adding that financial advisors in Canada
SRP data shows that Solactive’s indices have shied away from mutual funds, which
account for four out of the 10 most used With the rate hikes, market-linked GICs are the run of the mill.
underlying assets by issuance – including can offer significantly higher guaranteed
the top pick - for structured products returns despite a tough distribution That's why they have flocked to structured
issued from 2022, which comprise channel at Desjardins. notes," concluded Cloutier.

28 www.structuredretailproducts.com
 SRP AMERICAS

SRP Americas 2023:

in pursuit of a scalable turnkey solution
Platforms offering a one-stop shop with all things structured products are helping drive up market
growth and adoption, panellists said.

accessed,” said MacLean, who described “We want the money to stay sticky with
the growing mature market as needing a structured products,” she said. “We don’t
“turnkey solution from start to finish.” want someone to have a call notification
and realise 30 days later that they've been
“I think pieces of the process have got sitting on cash.”
better – from auto prices on the issuer side
to cleaning up some of the order entry,” she Meanwhile, more issuers have gone to
said. “But ultimately, we’re trying to close the explore various new markets such as
gaps in the process so that it truly is a front South Africa and South Korea in terms
end and smooth experience for advisors of the digitisation aspect, according
and therefore for clients.” to Stefan Wagner, head of business
development at Vestr, a Zug-based
One-stop shop financial technology provider that focuses
Rashad Anderson, head of private on actively managed certificates (AMCs).
bank relationship management and
business development at Luma Financial Catering for calendar deals
As digitalisation continuously grow the Technologies, agreed on the idea of a one- Yet as the industry moves towards
structured products value chain from stop shop for structured products. customisation, the traditional calendar
pre-trade to execution, the industry is now deals – that are primarily used in the US
eyeing how to leverage technology to “I think the focus has been on streamlining market as issuers launch product batches
streamline the process and improve user the process, moving away from on a calendar basis – still have a place,
experience as the next phase for growth. spreadsheets and emails and bringing it into according to MacLean.
a more automated system,” Anderson said,
We want the money to stay sticky with adding that how to manage after creating “More and more over the years, [platforms
structured products [...] we don’t want deals and following the execution is the next are helping with the] introduction of
someone to have a call notification and challenge and opportunity for growth for structured products to new users,” she said.
realise 30 days later that they've been sitting structured products platforms.
on cash - Ashley MacLean, iCapital “Once you get somebody [feeling]
Not just in the US, the European market comfortable and having a really good
This is according to a group of panellists at also has the same goal of bringing separate experience, they can see their portfolio,
the SRP Americas 2023 Conference, held in fragments into one piece, according to [get] their analytics, and didn’t have a
Chicago on 27 September. Géraldine Laussat, global head of structured missed coupon – and could end up rolling
products at OTCX, a London-based multi- this into a custom note.
In the US, the structured products space dealer request for quote (RFQ) platform
has been working on standardising targeted at the buy-side. “At the same time, technology can make
demystification over the past few years as that calendar process less clunky,” she
this “fragmented marketplace” historically “The European approach has been to added.
tends to lack a common nomenclature and have a top-down deployment approach to
education, according to Ashley MacLean digitise [processes at] private banks and Luma’s Anderson highlighted that going
(pictured), senior vice president at iCapital’s broker-dealers,” Laussat said. “Streamlining forward there will be a healthy mix of
SIMON structured investment client the process has been in the mind of issuers calendar and custom deals, particularly in
coverage team. to lower the operational risk.” the US.

“We can start focusing more on accessing iCapital’s MacLean noted that the lifecycle “Improving user experience that allows
lifecycle, just like the entire experience, tools that are being developed across more readily accessible data about
and making it a simpler and easier to use the board will help the industry monitor structured products will help scale the
product so that it can be more widely products throughout their lifecycle. market, said Anderson.

www.structuredretailproducts.com 29
 SRP AMERICAS AWARDS

SRP Americas 2023 Awards

The best in class in the structured product industry gathered on 27 September in Chicago for the SRP
Americas Awards 2023.

30 www.structuredretailproducts.com
 SRP AMERICAS AWARDS

www.structuredretailproducts.com 31
SRP AMERICAS AWARDS

SRP Americas 2023 Awards

All the winners

Manufacturer Awards
Best House, Equities Best House, USA

J.P. Morgan J.P. Morgan

Best House, Foreign Exchange Best House, Canada

Monex Desjardins

Best House, Interest Rate Best House, Mexico

Citi BBVA

Best House, Commodities Best House, Brazil

Morgan Stanley Santander

Best House, Capital Protection Best House, Americas

Desjardins J.P. Morgan

Distributor Awards
Best Capital Protected Distributor, Americas Best Independent Broker-Dealer, USA

Desjardins InspereX

Best Distributor, Yield Enhancement Best Private Bank, Americas

Morgan Stanley UBS

Best Distributor, USA Best Performance, USA

Morgan Stanley Raymond James

Best Distributor, Canada Best Performance, Canada

BMO BMO

Best Distributor, Mexico Best Performance, Mexico

BBVA BBVA

Best Distributor, Brazil Best Performance, Brazil

Santander Santander

Best Distributor, Americas Best Performance, Americas

BBVA BBVA

32 www.structuredretailproducts.com
 SRP AMERICAS AWARDS

Service Provider Awards

Best Index Provider Best Multi-Issuer Platform

S&P Dow Jones Indices Luma

FIA / VIA Hedge Provider Best Pricing and Risk Analytics Provider

Goldman Sachs Bloomberg

Best Proprietary Index Provider Best Technology Provider

Barclays Bloomberg

Best Structured Product & Derivatives Exchange Best Hedge Provider

B3 Goldman Sachs

Best Single-Issuer Platform Best Law Firm

JPMorgan SI 360 Mayer Brown

Innovation and Education Awards

Best Educational Initiative Deal of the Year, Canada

Market-linked guaranteed investments online experience Responsible Option Aggressive Guaranteed Portfolio (Desjardins)
(Desjardins)
Deal of the Year, Latin America
Best Structured Product Technological Solution
Range Accrual USD Resurrection (Monex)
Stifel
Deal of the Year, Annuities
Index of the Year, Structured Products
Athene Performance Elite with Strategy Preset
Goldman Sachs Momentum Builder Focus ER Index
Most Innovative Product
Index of the Year, Annuities
CME Term Sofr 1m Coupon Range (Monex)
WisdomTree Siegel Strategic Value Index (Annexus)
Personality of the Year, Structured Products
FIA/VIA Carrier of the Year
Eduardo Martinez Campos
Lincoln Financial
Personality of the Year, Annuities
Deal of the Year, USA
Marie-Laure Chandumont
Lookback Trigger PLUS Note (HSBC)

www.structuredretailproducts.com 33
 Q&A: BUYSIDE VIEW

Buyside View: we expect to see more

accelerated trackers, digital pay-offs
As the UK market celebrates the 20th anniversary of the first autocall payoff structure, evidence
supports the value of this investment product as an addition to any investor portfolio.

A low interest rate

environment is bound
to push investors
towards riskier
assets

Ian Lowes (pictured), managing director at Lowes Financial provide an adequate hedge against inflation but in fact lose
Management and founder of StructuredProductReview – value in real terms “on a daily basis”.
a specialist portal for professional advisers, noted in a
research report that the autocall structure is not just “a “Investing is therefore still key and given a choice between
reliable investment option regularly overlooked by financial an autocall that will mature with a gain of 10% for each year
advisers” but also “the most successful retail investments of held, when say the FTSE 100 rises by any amount vs a straight
the 21st century”. market participation investment, the autocall still has a great
deal of appeal,” said Lowes.
Autocalls became the go to product among investors and
providers as a result of the low rates environment triggered
by the 2008 global financial crisis, so we asked Lowes if the Synthetic underlyings
current rates increases are posing a threat to this payoff
structure. The dividend crisis of two years ago prompted a resurgence
of synthetic dividend underlyings among autocall structures
“It is accepted that in the first five years after the introduction which became the holy grail for issuers as they could manage
of the autocall when interest rates were high, there weren’t the dividend risk better and hedge more effectively their
too many brought to market and the number issued increased exposures and investors as they could also access better
substantially during the next 15 years when interest rates were potential returns.
low,” said Lowes.
“This to me was the most logical solution to the dividend
“A low interest rate environment is bound to push investors problem and its introduction represented a good outcome for
towards riskier assets and whilst higher interest rates all,” said Lowes, noting that one synthetic index “really stands
will, conversely see some investors switch to a deposit out” in the UK market - the FTSE Custom 100 Synthetic 3.5%
environment one of the primary reasons for investing is to Fixed Dividend Index (FTSE CSDI).
combat the effect of inflation.”
The CSDI tracks the same 100 shares in the same proportions
According to Lowes, even the best deposit accounts rarely but unlike the FTSE 100, the CSDI includes the benefit of the

34 www.structuredretailproducts.com
 Q&A: BUYSIDE VIEW

Structured products have proved to be

exceptional investments for a very long time

dividends paid by the 100 companies (which have historically Going forward
averaged around 3.5% per annum) and then deducts the
equivalent to a fixed 3.5% per annum, on a daily basis. Despite the dominance of the autocall Lowes sees a
significant resurgence of deposit based, and non-contingent
According to Lowes, the result is that the index will perform fixed interest products.
almost identically to the FTSE 100 if dividends are at 3.5%
pa, moderately underperform if they are less, and moderately “We expect to see more accelerated trackers and digital pay-
outperform if they are more. offs,” he said.

“The CSDI has been 99% correlated with the FTSE 100 Index,” “From a stock market perspective nothing has changed in that
said Lowes. I still know that I don’t know and know that no one else knows
either – which is why I continue to favour longer maximum
“By utilising the FTSE CSDI rather than the FTSE 100 the duration autocalls that have a very high probability of coming
potential returns offered are often noticeably enhanced as good and outperforming the underlying in all but extreme
they benefit from the removal of the premium that would circumstances.”
otherwise be retained by the counterparty to cover the
dividend shortfall risk.” As for the structured product market, Lowes has a positive
outlook as structured products “have proved to be exceptional
To date four counterparties including Morgan Stanley, Citi, BNP investments for a very long time”.
Paribas and Goldman Sachs have adopted the FTSE CSDI.
“There is some talk that they are beginning to really take off in
“It has proved beneficial for all parties,” said Lowes. terms of acceptance and use in many quarters of the UK retail
sector,” said Lowes. “Providers will be keen to capitalise on this
“Utilising the FTSE CSDI does admittedly add a barrier and will be looking to innovate where they can but for now with
compared to utilising the more readily accessible FTSE 100 typical 60 or more structures of varying shapes being offered
but given that the main index can be used as a proxy for the in the IFA market there are plenty of decent options available.
CSDI the barriers are easily overcome and a small price worth
paying for better outcomes.” “Long may this continue.”

Basler Kantonalbank enters BX Swiss’ trading segment deriBX

From 13 October 2023 investors will be able to trade structured products from Basler Kantonalbank in the BX Swiss trading segment
deriBX. With the addition of Basler Kantonalbank as a new issuer on BX Swiss, the Swiss Exchange is expanding its growing range of
exchange-traded structured products.

Basler Kantonalbank offers tailor-made and innovative certificates in the categories of capital protection, yield optimisation and
participation and has credit ratings of AAA from Fitch and AA+ from Standard & Poor's.

‘The partnership with Basler Kantonalbank is another milestone in our efforts to provide our investors with high quality products and
to continuously expand our range of exchange-traded structured products,’ said David Kunz, COO of BX Swiss.

www.structuredretailproducts.com 35
 Q&A: MERQUBE

MerQube: there is room for competition

around multi asset, derivatives
Indexing technology company MerQube completed in late July a Series B funding round which raised
US$22m and was led by Intel Capital with participation from new investor Allianz Life Ventures, and
existing investors Citi, J.P. Morgan, Laurion Capital Management and UBS.

We think our core value

proposition will resonate
with global investment
banks operating in
Europe

SRP spoke to the firm’s CEO Vinit Srisvastava and its chief The index technology company is also looking to develop new
commercial officer Roby Muntoni about the firm’s plans indices adapted to specific markets by leveraging the existing
following the new injection of capital and the authorisation platform and infrastructure, according to Muntoni.
received by the UK Financial Conduct Authority (FCA) to offer
benchmark administration under the Benchmarks Regulation “The data has already been piped in and can be deployed
(UK BMR). to build global benchmarks and create new strategies. It’s a
natural evolution for the business and the funding will help to
On one hand, according to Srivastava (pictured), MerQube ensure that we are ready and able to enter the next stage of
will look to capitalise on the support of Intel Capital to “close development,” Muntoni said.
the fintech gap in passive investing” as well as expand into
the insurance market in the US with the strategic direction of
Allianz Life Ventures. Market edge

In Europe, the plan is to expand across markets to help “unlock In essence, the US firm is not looking to compete with
unmet demand for index-linked investments” - the FCA license traditional index providers as its value proposition is not purely
and the recent funding round are part of the company’s plan on indexing but on technology.
to grow on this side of the pond, said Srivastava.
“Our cloud native SaaS platform and API-first solutions were
“One of the good things about indexing is that from a product designed and built to increase speed to market agility and
perspective it scales very well across markets,” he said. “We price efficiency to address and unlock unmet demand for
think our core value proposition will resonate with global index-linked investments,” said Srivastava, noting that nine
investment banks operating in Europe as it has done with times out of 10, traditional index providers will win a request
domestic investment banks in the US. It's kind of the same for proposal (RFP) regarding broad base benchmark exposure.
value proposition.”

36 www.structuredretailproducts.com
 Q&A: MERQUBE

MerQube’s US Tech+ Vol Advantage Index

Source: MerQube

However, when it comes to specific and more granular The index has featured across 246 products issued via
exposure, baskets, efficiencies and self-indexing MerQube J.P. Morgan in the US worth US$74m in 2022; and has also
“has a very competitive proposition”. collaborated with UBS after being appointed by the Swiss
bank as the calculation agent and administrator of the UBS
“By definition, the big four index providers have already built Constant Maturity Commodity Index (CMCI) range.
their niche areas of dominance (MSCI-global market; S&PDJI
US equities, FTSE Russell-UK market), but when it comes to Since its launch in 2019 MerQube has developed a full range
the multi asset and derivative spaces Srivastava believes that of indexes including equity baskets as well as decrement,
“there is a lot more room for other players". risk control and thematic indexes such as the MerQube
Defined Protection Indices, MerQube Single Stock TR indices,
“We have seen this with other entrants to the index and MerQube AI for Alpha Multi Asset VT Core, MerQube Vol Edge
structured products markets.” or the MerQube Reverse Convertible Indices.

MerQube received FCA authorisation under Benchmarks The firm has also partnered the investment banks
Regulation (BMR) in May 2023 after completing its adherence supporting the business to develop new custom indices
to the International Organization of Securities Commissions such as the Citi AI for Alpha Multi Asset range; the UBS CMCI
(Iosco) principles for Financial Benchmarks in September 2022. Sustainability, UBS Multi Asset Inflation Aware and UBS
Global Intraday Trading Indexes; the MerQube US Large-Cap
The firm is one of the latest entrants to the structured Vol Advantage Index and MerQube US Tech+ Vol Advantage
products market and has established one of its indices - the Index which were developed with J.P. Morgan; and the
MerQube’s US Tech+ Vol Advantage Index – as one of the MerQube XP Multi Asset 6% VT Index which was developed
highest selling thematic indices in the US market. with Brazil’s XP Banco.

There is a lot more room for other players

www.structuredretailproducts.com 37
 Q&A: MSCI

MSCI: new rotation play – faster

than the market
The index provider is seeking new sources of data to expand its index catalogue with new
rotating strategies.

As the economy moves

from one regime to
another the assets in the
index are rotated

Following the recent launch of the MSCI Economic Regime “[These] insights are very valuable to measure markets using
Allocator Index in partnership with alternative data specialist data that can’t be used on its own, although its relevance is
QuantCube Technology, SRP spoke to Stephane Mattatia very intuitive – if the subscriptions of mobile phone operators
(pictured), global head of thematic indexes and derivatives go down, it is a bad sign for consumer spend, as this is one of
licensing at MSCI, about extracting value from the different the last things people would cancel or stop paying for when
cycles or phases in the financial markets. things go bad.”

The new series which include a US and world versions as well

as optimised risk control options of five and 10% targeted at The index
issuers of structured products allocates assets to different
market subsets based on the current economic regime. The According to Mattatia, the partnership with QuantCube
definition of the four different economic regimes – stagflation, Technology was a no brainer as “this data could be used to
heating up, slow growth and goldilocks – are based on the rate improve existing strategies using official GDP and CPI figures
of change of GDP and CPI indicators and whether these are and create new sector rotation indices”.
rising or falling.
The initial step when designing the index was to look at the
“As the economy moves from one regime to another the four stages of the business cycle - stagflation, heating up,
assets in the index are rotated and reallocated with the aim of slow growth and goldilocks.
maximising investment performance,” said Mattatia.
The index then applies two levels of allocation - multi asset
The role of QuantCube Technology is to process a significant and equity – in relation to where we are in the business cycle.
amount of unstructured global macro data to provide a final output
around GDP growth, CPI and international trade across markets. “If we look at the historical performance of each MSCI World
sector depending on the stage of the business cycle, there is
“This means that it is giving us a real time evaluation of the a huge pronunciation of sector behaviour depending on where
economy without having to wait for official figures,” said Mattatia, we are in the business cycle,” said Mattatia.

38 www.structuredretailproducts.com
 Q&A: MSCI

The outcome is a very robust performance that

creates value over time compared to the benchmark

Then the sector exposure across cyclical and defensive before the official data is published.
sectors is directly driven by the four or five sectors that had
the best behaviour at each stage. “The data QuantCube Technology delivers is reliable,” said
Mattati. “Clients are happy with the simulations which makes
“The outcome is a very robust performance that creates us believe that this is only the beginning of the story because
value over time compared to the benchmark which has a very there is so much [more] we can do.
classic institutional allocation - 60% on the MSCI World and
40% treasuries,” said Mattatia. “We have started with sector rotation and multi asset
allocation, but we can also do factor rotation, country rotation,
This approach, he said, can be used to create other variations or look at ESG. The advantage of this approach is that it is
– “we tested a long only pure equity allocation with no always faster than the market.”
Treasuries that also outperformed the benchmark, and we are
having discussions already with clients about long/short and Mattatia said there is interest from structured products, asset
risk control versions”. owners and ETF providers “seeking to deploy a strategy that
adapts automatically to the economy”.

New datasets The development of this new index follows the launch of a
recent partnership aimed at increasing MSCI’s presence in
The advantage of the data supplied by QuantCube Technology the US annuities market – the index provider entered into a
is that it always shows a trend and eliminates the dependence collaboration with Salt Financial to create risk-control index
on official economic data, which lags versus the market solutions for insurance companies using Salt's patent-pending
because the market assesses how the economy is doing truVol Risk Control Engine (RCE).

European retail investors turn sharply bearish on UK equities

Pan-European trading venue for securitised derivatives Spectrum Markets has revealed a steep decline in sentiment towards the
FTSE 100 index, dropping to 87 points.

According to Spectrum, the FTSE saw a notable uptrend in the first half of September, reaching its peak around September 20th
before declining towards the month's end. The movement in the FTSE 100 price can be closely tracked to the sentiment of retail
investors, as reflected in the company’s SERIX index.

The alignment of the two indices suggests that in September a significant proportion of activity on Spectrum linked to FTSE
100 was directional trading, though it’s likely there was still an element of hedging wider equities portfolio positions, which is also
common, according to Michael Hall (pictured), head of distribution at Spectrum.

In September 2023, 158 million securitised derivatives were traded on Spectrum, with 31.6% of trades taking place outside
of traditional hours. More than ninety percent of the traded derivatives were on indices, 6.4% on currency pairs, 2.2% on
commodities, one percent on equities and 0.1% on cryptocurrencies, with the top three traded underlying markets being DAX 40
(41.1%), Nasdaq 100 (20.4%), and S&P 500 (10.7%).

www.structuredretailproducts.com 39
 CRYPTO NEWS

Crypto news
All the latest developments in digital assets from across the globe

Euronext lists first spot BTC tracker in Amsterdam data components extracted from open blockchains, targeting
institutions, advisors and investors interested in digital assets
exposure.
London-based Jacobi Asset Management
has listed Europe’s first spot bitcoin The partnership responds to demand from institutional clients
exchange-traded fund (ETF) on Euronext interested in an index product that ‘is easily understandable for
Amsterdam. The Jacobi FT Wilshire Bitcoin investors from traditional finance,’ Martin Leinweber (pictured),
ETF tracks the performance of the FT digital asset product strategist at MarketVector.
Wilshire Bitcoin Blended Price Index, which
is provided by Wilshire Indexes with a built-in ‘By integrating fundamental data into our index methodology,
Renewable Energy Certificate (REC) solution we can better reflect blockchain protocols' true economics and
created in collaboration with digital asset platform, Zumo. user traction,’ Leinweber said. ‘We believe that the next cycle of
crypto adoption will be driven more by fundamentals than the
The new ETF is regulated by the Guernsey Financial Services previous cycles.’
Commission and trades under the ticker BCOIN. Fidelity Digital
Assets provides custody services with Flow Traders acting as The Frankfurt-based index provider aims to incorporate Token
market maker, and Jane Street and DRW as authorised participants. Terminal’s perspective in data and analytics into its Digital Asset
index to provide a ‘more comprehensive view of the crypto
‘It is exciting to see Europe moving ahead of the US in opening up marketplace to its clients’.
bitcoin investing for institutional investors who want safe, secure
access to the benefits of digital assets using familiar and regulated
structures,’ said Martin Bednall (pictured), CEO of Jacobi Asset
Management. SEBA gets HK approval-in-principle to offer
structured products
The ETF also represents the first digital asset fund compliant
with Article 8 of the European Sustainable Finance Disclosure
Regulation through its decarbonisation strategy. Jacobi stated it SEBA Bank Hong Kong, the subsidiary of
has implemented a verifiable built-in renewable energy certificate Swiss crypto-focused SEBA Bank, has been
(REC) solution, allowing ‘institutional investors to access the granted an approval-in-principle from the
benefits of bitcoin whilst also meeting ESG goals’. Securities and Futures Commission (SFC) to
operate regulated virtual asset activities in
The fund was first approved in October 2021 and was set to go Hong Kong SAR.
live in July 2022. However, the firm postponed the launch as ‘the
time wasn’t right’ following the collapse of the Terra ecosystem The launch of Hong Kong’s first licensed retail
and the bankruptcy of the FTX cryptocurrency exchange last year. trading exchange is the first step for SEBA Hong Kong to acquire
an official licence, which will allow it to operate as a licensed entity
once all the SFC conditions have been met.

MarketVector unveils blockchain data-focused indexes The licence will allow SEBA to offer crypto services and deal in
securities, including ‘virtual assets-related products, such as OTC
derivatives and structured products, advise on securities and
MarketVector Indexes has teamed up with virtual assets, and conduct asset management for discretionary
financial data platform Token Terminal to accounts in both traditional securities and virtual assets’.
provide access to products that track data in
web3 and blockchains. Led by CEO Franz Bergmüller (pictured), SEBA Bank received its
Swiss banking and securities dealer licence in August 2019. In
Under the collaboration agreement the February 2022, the bank secured financial services permission to
two firms will co-create indexes using any operate in Abu Dhabi.

40 www.structuredretailproducts.com
 NEWS
CRYPTO
| EUROPE
NEWS

Grayscale wins lawsuit against the SEC The Bitget Snowball is designed for users of both bullish and
bearish approaches. the bullish option is focused on safeguarding
users' principal while predicting future prices to fluctuate
The US Court of Appeals for the DC moderately or experience slight increases within specific price
Circuit court on 29 August ruled against ranges. the bearish option is best suited for users aiming to protect
the Securities and Exchange Commission their principal while predicting future prices to fluctuate moderately
(SEC)’s decision to deny crypto asset or experience slight decreases within specific price ranges.
manager Grayscale Investments’ request to
convert its bitcoin trust into an exchange- Bitget will provide all subscribing users with a comprehensive
traded fund (ETF). scale chart of knock-in and knock-out prices for both bullish and
bearish scenarios - users of the snowball will have the right to early
The Court stated that Grayscale ‘presented substantial evidence redemption as well, the latter being based on the accumulated
that Grayscale’s request is similar, across the relevant regulatory APR at the time of submitting the early redemption application.
factors, to bitcoin futures exchange-traded products (ETPs),’ and
‘the commission failed to adequately explain why it approved the
listing of two bitcoin futures ETPs but not Grayscale’s proposed
bitcoin ETP’. WisdomTree introduces staking in physical ether ETP

The SEC denied Grayscale’s application to convert its spot

Grayscale Bitcoin Trust into an ETF in 2022. Grayscale was among Asset manager WisdomTree has enabled
the asset managers along with Fidelity and Invesco whose spot staking in its physically backed ether ETP to
Bitcoin ETF applications have been rejected by the regulator for capture yield that ranges from four to eight
investor protection reasons. The SEC previously approved Bitcoin percent pa, according to the company’s
futures ETF but has yet to give the green light to spot Bitcoin ETFs. announcement.

The court’s decision coincided with a flurry of large financial The ETP – WisdomTree Physical Ethereum
institutions such as BlackRock and VanEck awaiting the regulators’ (ETHW) – is listed on Börse Xetra, SIX, the
decision on their bitcoin spot ETF applications. Swiss Stock Exchange, and Euronext exchanges in Paris and
Amsterdam and has a total expense ratio of 0.95%.
‘It’s incredibly exciting that we are one step closer to making a US
spot bitcoin ETF a reality,’ said Michael Sonnenshein (pictured), Using Ethereum’s native cryptocurrency as the underlying, the
CEO of Grayscale. staking feature on the fund allows investors to access the crypto
assets without the need to hold them directly, store private access
keys, or interact with the blockchain infrastructure, stated the firm.

Bitget unveils fully protected snowball play ‘Staking has the potential to make investing in cryptocurrencies
more attractive for investors,’ Alexis Marinof (pictured), head of
Europe at WisdomTree, said in the statement.
Crypto derivatives and copy trading
exchange Bitget has launched the Bitget ETHW became the second ETP to provide a staking reward in
Snowball, its groundbreaking structured WisdomTree’s cryptocurrency product range, following the step
investment product aimed at sophisticated of WisdomTree Physical Solana (SOLW). The custodians for
investors. WisdomTree’s ETPs are Swissquote and Coinbase Custody Trust
Company, according to the firm.
The new instrument will provide users with
up to 24.5% APR with no risk to the capital
invested. The Bitget Snowball structure aligns with the overall
"trade smarter" philosophy the firm has been using among a Deutsche Bank taps Taurus’ custody, tokenisation
younger and more market-knowledgeable audience of users. services

The Bitget Snowball is designed to help users navigate the ever-

evolving cryptocurrency market landscape with a heightened level Deutsche Bank has partnered with Taurus,
of confidence and security, while maintaining a relatively low-risk a Swiss-based digital asset infrastructure
profile, according to Gracy Chen (pictured), managing director at provider, with the aim of leveraging custody
Bitget. ‘With the launch of Snowball, we are redefining the crypto and tokenisation technology to manage
investment landscape. Snowball isn't just a product; it's a testament cryptocurrencies, tokenised assets and
to our dedication to helping users trade smarter and more digital currencies, according to Taurus’
confidently in the dynamic world of cryptocurrencies,’ Chen said. announcement.

www.structuredretailproducts.com 41
 CRYPTO NEWS

‘As the digital asset space is expected to encompass trillions of (SET), to expand into Mena to help pre-IPO companies leverage
dollars of assets, it’s bound to be seen as one of the priorities for blockchain to raise funds.
investors and corporations alike,’ said Paul Maley (pictured), global
head of securities services at Deutsche Bank. ‘As such, custodians ‘It offers the ability to strengthen the economic connection and
must start adapting to support their clients.’ flow of investment capital between key Apac and Middle Eastern
markets while fostering the growth and expansion of strategically
The latest development came after Taurus’ integration to the important MSMEs across the region,’ said Danny Toe (pictured),
Ethereum’s scaling platform Polygon blockchain across its founder and Group CEO of ADDX.
custody and tokenisation platform in June in a move to allow
banks, brands, and issuers to issue, book and service any ADDX has been one of the most prolific tokenisation platforms,
tokenised assets via Polygon in a fully automated way. listing more than 80 deals so far including pre-IPO companies. It
has also facilitated a US$100 million bond issuance for SingTel,
Earlier this year, Deutsche Bank participated in Taurus’ US$65m and several asset managers issued funds using the platform.
Series B funding round alongside Credit Suisse, Pictet Group, and Other listed assets on the platform range from private equity
Arab Bank Switzerland. and venture capital to funds, real estate and structured products.
Some of its issuing partners include Hamilton Lane, Partners
Group, Investcorp, Singtel, UOB, CGS-CIMB, as well as Temasek-
owned entities.
Talos unveils crypto options trading

Talos, a US provider of institutional digital Northstake raises €2.8m to bolster institutional staking
asset trading technology, has announced the
launch of a partnership with cryptocurrency
derivatives exchange Deribit to offer options The Copenhagen-based cryptocurrency
trading on its platform as it seeks to extend staking platform has raised €2.8M from
tradeable assets for its clients. PreSeed Ventures, Morph Capital, The
Aventures Fund, Funfair Ventures and Delta
The integration between Talos and Deribit Blockchain Fund. The proceeds will be used
allows institutional traders in select jurisdictions to access to improve its multi-chain staking platform
the exchange’s options liquidity through a new Talos interface designed for institutional investors, which
designed for institutional options traders. offers single asset, multi-asset, thematic and
yield generating products, Northstake announced on 22 June. The
The launch will provide clients with a ‘single interface’ to manage staking products are packaged into structured products based on
their cryptocurrency portfolio, including spot, futures, perpetual known investment vehicles, according to the firm. The platform
and options, with advanced execution tools initially including limit operates in compliance with incoming crypto regulation in the EU
and pegged orders and an Iceberg algo. (MiCA). ‘We will continue to work with regulators on developing
crypto regulation in Europe and the Middle East,’ said Jesper
‘With the full Deribit options chain now at their fingertips, Talos Johansen (pictured), CEO and founder of Northstake.
clients can unlock a myriad of strategic possibilities, allowing them
to effectively manage risk, enhance portfolio diversification, and
capitalise on the immense potential of crypto,’ said Neelabh Dixit
(pictured), commercial product manager, derivatives at Talos. SG Forge gets first crypto license in France

Société Générale (SG) Forge has obtained its

Singapore tokenisation platform eyes Middle East regulatory license approval as a digital asset
service provider (DASP) in France. The license
approval means that SG-Forge becomes the
Singapore’s ADDX has unveiled plans to first licensed company to provide services
expand into the Middle East and North Africa such as buying and selling, custody and
(Mena). exchange of digital assets - the digital assets
arm of SG registered the DASP with the
The regulated tokenisation platform and French Financial Markets Authority (AMF) in September 2022.
private exchange has raised US$140 million
in venture capital, primarily from several major With the DASP license, the SG subsidiary reaffirms ‘its pioneering
Asian financial institutions including the role in the crypto assets ecosystem,’ according to Jean-Marc
Singapore Exchange (SGX) and the Stock Exchange of Thailand Stenger (pictured), CEO of SG Forge.

42 www.structuredretailproducts.com
 CRYPTO NEWS

‘This step will allow us to continue supporting our institutional Department of Financial Services for a limited-purpose trust
clients wishing to benefit from services on digital assets that meet company, which would oversee the customer business.
the highest standards of compliance and banking security,’ he said.
Friedman said Nasdaq will continue to support the digital asset
The DASP approval came after SG Forge's launch of the Euro industry including partnerships with potential exchange-traded fund
CoinVertible (EURCV) in April, a euro stablecoin on the Ethereum (ETF) issuers and providing technology for cryptocurrency custody.
public blockchain that complements the firm’s business offer to
institutional clients who seek to ‘benefit from innovative settlement Nasdaq’s move came after a flurry of aggressive regulatory
and cash management solutions’. actions from U.S. authorities this year. In February, the US
Securities and Exchange Commission (SEC) chair Gary Gensler
SG Forge anticipates the implementation of the European proposed amending federal custody requirements, expanding the
Union's Markets in Crypto-Assets Regulation (MiCA), with the rules to include assets like cryptocurrencies.
objective to regulate the crypto-asset market at the European
Union level by 2024.

Defi platform rolls out new customisable interest

rate structures
Alpha Blue Ocean (ABO) invests US$200m to
Islamic Coin
Decentralized finance (DeFi) platform Struct
Finance has announced the mainnet launch
Bahama-headquartered ABO, an investment of its Interest Rate Vaults and tranching
firm dedicated to structured products, has mechanism. The newly introduced Interest
put down US$200m in the Shariah-compliant Rate Vaults allow investors to split and
cryptocurrency through its subsidiary ABO repackage the risk of yield-bearing DeFi
Capital. Its total funding of Islamic Coin assets into different tranches that align with
has reached US$400m, surpassing Circle, their risk profiles.
BlockFi and Solana, according to a statement
issued by ABO on 3 July. Islamic Coin is a This is achieved through “tranching” with each interest rate
native currency of HAQQ, a community-run network, dedicated product representing a single vault split into two portions, or
to empowering an ethics-first Shariah-compliant financial tranches, with different return configurations including a fixed-
ecosystem. The latest partnership will ‘help the team structure return tranche - designed for conservative investors seeking
innovative Shariah-compliant financial products that could be consistent returns- and a variable-return tranche – for investors
used in the digital asset space to raise alternative funding’. It is with a higher risk appetite.
‘revolutionizing the Shariah-compliant market by introducing
digitization’, said ABO Digital CEO Amine Nedjai (pictured). Struct Finance co-founder Miguel Depaz (pictured) said the
platform’s mission is to make structured financial products
‘accessible and easy to understand for everyone’.

Nasdaq halts plan for crypto custody service amid US ‘Traditional financial products aren’t permissionless to use or
regulatory uncertainty create [...] in fact, they are largely inaccessible to most people. We
are making these structured financial products accessible and
easy to understand for everyone,’ he said.
The US exchange has ditched its plan to
launch a cryptocurrency custody service,
citing regulatory uncertainty in the US,
according to CEO Adena Friedman (pictured). DAO examines limits to on-chain structured product
market
‘Considering the shifting business and
regulatory environment in the US, we’ve
made the decision to halt our launch of the Index Coop, a decentralised autonomous organisation (DAO), has
US digital assets custodian business and our related efforts to released a report pinpointing several challenges facing structured
pursue a relevant license,’ Friedman said in the company’s Q2 products in the digital asset industry such as infrastructure
2023 earnings call. limitations, intending to improve the experience of investing
in cryptocurrency. The infrastructure limitations of this sector
Nasdaq revealed in March that its custody service, which was include a need for cross-chain asset support, high and volatile
announced in September 2022, is expected to go live by the issuance and redemption costs to maintain products and difficulty
end of the second quarter. The firm had applied to the New York rebalancing on-chain products due to slippage.

www.structuredretailproducts.com 43
 ANALYSIS

US trends:
shift back to protected growth continues
An analysis of the US market over the last three years shows the changes in the use of product types
as the macro environment evolves. By Suzi Hampson

Figure 1: Product notional (USD m) by capital and aim property - Jul 2020 – Jun 2023

25000

20000

15000

10000

5000

0
Jul 2020 - Dec 2020 Jan 2021 -Jun 2021 Jul 2021 -Dec 2021 Jan 2022 - Jun 2022 Jul 2022 - Dec 2022 Jan 2023 - Jun 2023

At risk Growth At risk Income Protected Growth Partially protected Growth Protected Income

Source: StructPro

Earlier this year we used data from StructrPro to look at the best and popular product type and at-risk income (which also includes
worst performing underlyings in the US. Performance statistics for traditional reverse convertibles) was the most common of the more
individual products and portfolios are the main focus of StructrPro general capital aim categories.
however this article is going to examine trends in the market which
is another key area that can be performed by using StructrPro. This trend reversed for the following three periods as at-risk growth
products have once again become the most popular category
The following analysis has been extracted from StructrPro and with leveraged return, and digital growth products increasing their
covers products striking since July 2020. Products are grouped into market share. This suggests that where investors were looking to
six-month periods and the products within each period can then be structured products to provide yield outside of traditional income
group into categories of different criteria. investments there has been a shift back to growth products as
risk free rates have risen and income seeking investors have other
Figures 1 and 2 illustrate the change in product characteristics over solutions elsewhere.
the past three years. Figure 1 is broken down into broad categories
focusing on return aims and capital repayment. Protected growth products have become more common over the
past 18 months and there have also been a small number of capital
Figure 2 covers a structured product specific product type protected income products over the past year. The rise in capital
breakdown. The charts also show the progression of total USD protection can also be contributed to the rise in interest rates.
sales of products over the period. The most noticeable feature is Higher rates makes structuring capital protected products easier
the very low total for the first period of this analysis (shortly after the as the capital protection costs less and therefore there is more to
start of the Covid-19 pandemic) and the recovery over subsequent spend on options leading to more attractive product terms.
semi-annual periods.
Figure 3 shows a breakdown for each period of the top 10 most
From both charts we can see a change in the proportion of income common underlyings. This analysis shows how many times each
vs growth products. During 2021 income autocalls were the most underlying appears in a product either as a single underlying or as

44 www.structuredretailproducts.com
 ANALYSIS

Figure 2: Product notional (USD m) by product type Jul 2020 – Jun 2023

40000

35000

30000

25000

20000

15000

10000

5000

0
Jul 2020 - Dec 2020 Jan 2021 - Jun 2021 Jul 2021 - Dec 2021 Jan 2022 - Jun 2022 Jul 2022 - Dec 2022 Jan 2023 - Jun 2023

Income Autocall Leveraged Return Growth Autocall Digital Growth Dual Directional Callable
Protected Growth Tracker Fixed Income Defensive Autocall Contingent Income

Source: StructPro

part of a basket. This chart shows the breakdown by number of observed had the highest proportion of products linked to the S&P
product issued (rather than notional amount). 500 suggesting some preference for products linked to established
names.
The top five underlyings of the ones shown here are all benchmark
stock market indices. These are consistently the most popular Identifying trends in any market is interesting both in terms
underlyings in the US and are used in products either as the sole of looking backward and for forecasting future or expected
underlying or as part of a basket. During 2021 when the market was behaviours. Keeping abreast of patterns such as some of the
recovering from Covid-19 there was a sharp increase in both the observations discussed here enables stakeholders to monitor
number of products issued and sales volume. the current situation and gives an idea of how the market reacts
in certain environments which may help predict the direction the
During this period the spread of underlyings was greater than for market is headed.
subsequent periods and the proportion of products linked to the
top five was lower than for the other four periods although still over StructrPro is a US structured products data service that
50%. Over the past year the number of products linked to the larger can be used to analyze both live and matured products
underlyings has been higher and more stable and the last period from the SRP US database using analytics powered by FVC.

Figure 3: Product issuance by underlying Jul 2020 – Jun 2023 for top 10 underlyings by total number of products over the three-year period

18000
16000
14000
12000
10000
8000
6000
4000
2000
0
Jul 2020 - Dec 2020 Jan 2021 - Jun 2021 Jul 2021 - Dec 2021 Jan 2022 - Jun 2022 Jul 2022 - Dec 2022 Jul 2022 - Dec 2022

S&P-500 Index Russell 2000 Index NASDAQ-100 Index Dow Jones Industrial Average EURO STOXX 50 Index
Apple Inc. Amazon.com Inc Tesla, Inc. SPDR S&P 500 ETF Trust iShares Russell 2000 Value ETF

Source: StructPro

www.structuredretailproducts.com 45
 ANALYSIS

Low volatility opportunities

In the early stages of the Covid pandemic in 2020, there was significant economic turmoil and a
stock market crash. By Tim Mortimer

Image: Volatility KanawatTH/Adobe Stock

In the three years that have followed, market volatility levels The VIX1Y peaked in March 2020 at 40% and was still at 33%
(both implied and historic definitions) have steadily dropped to in October 2022 after the global concerns of conflict, inflation
the point where most measures are at very low levels. and interest rate rises last year. In the last nine months, the
index has fallen steadily and as of 28 July 2023, stands at
Implied volatility is the more important for structured just over 20%. In contrast, the headline VIX peaked at 66% in
products as it reflects market pricing. There are many ways March 2020 but has now fallen all the way to 13%.
to assess the levels of implied volatility and different markets,
geographic regions and asset classes do not move in This major structural shift in pricing conditions coupled with
lockstep. the rise in interest rates that has occurred in the same period
has significant implications for issuing structured products
A popular and convenient way to gauge volatility is the VIX and creates many new opportunities. We will examine two
Index which calculates the level of S&P 500 implied volatility. aspects of this new low volatility environment - the type of
The VIX Index takes observed prices of exchange-traded products that now look attractive and how to tactically play the
options, and uses an accepted and transparent mathematical secondary market.
methodology developed 30 years ago. The headline VIX index
is based on liquid very short dated (30-day) options. Although For many years most markets had a regime of low interest
it is quoted less often, the one-year and longest VIX measure rates and moderate to high volatility. This tended to
(ticker: VIX1Y) is more stable and better representative of encourage yield enhancing capital at risk solutions which
volatility levels that are relevant for short to medium term would use the healthy premiums generating by taking
structured products. downside risk (essentially selling a put option of some kind) to

46 www.structuredretailproducts.com
 ANALYSIS

boost yield from the one to three percent risk-free interest rate which have dominated for many years. Such products are
range to levels closer to six to 10% expected and demanded usually at least five years long and if volatility levels were to
by many investors. pick up again, valuations would suffer in the secondary market.

Now that risk-free rates are around five percent and coupled However, even for this type of products there are some
with the extra pick up from taking bank credit risk, there are benefits in lower volatility, for example barrier levels can be
income solutions that some investors are happy with that do made more defensive, going down from perhaps 70% to 50%
not have any equity risk. The structured product sector has since this protection is now cheaper.
also seen good demand from issuer callable fixed income
solutions where fixed income paid but with the issuer having While lower volatility levels do represent a significant change
the right to call (terminate) the product early, for example in pricing conditions, it is not clear that this will lead to a
annually after two years on a five-year product. This can seismic shift in investor demand since the focus on yield
enhance yield by up to one percent per annum and to many remains very high for most investors.
investors seems like an almost irrelevant concession since it
affects neither capital nor income rates. Analysis of the secondary market also deserves attention. For
most retail investors, relying on the secondary market except
For those seeking more than the risk-free rate, one in times of need is not always economic because of the bid-
increasingly popular approach is to offer for contingent equity offer spreads that can be charged. Listed products or those
linked income while retaining capital protection. An example sold to a single end client such as a private bank give better
of this is to pay a fixed coupon each year if an equity index opportunities to tactically play changes in pricing conditions
is above its starting level. These types of strategies strike a because bid-offer spreads tend to be lower.
good balance of risk and opportunity but have little volatility
sensitivity and so do not benefit significantly from lower Capital-protected growth products stand to benefit the most
market volatility. in the secondary market if volatility levels rise. In the event
markets perform reasonably in the early part of a product’s
Decreasing volatility levels shift the opportunity back to lifetime, but volatility levels pick up, it may be worthwhile to
growth solutions because the way to benefit is to buy options sell on the secondary market and get a return from both the
and income products have limited opportunity to do so. The delta effect (market performance) and from vega (volatility
most obvious solution to take advantage of low volatility would sensitivity). The overall rate of return for the product earned
be a five to seven year capital protected product with full in the first year or two would be therefore quite attractive,
participation in equity growth. particularly if the expectation is that markets have little further
upside. Changes in interest rate levels will also influence
This would benefit from low option prices but would need any decision to sell early, a fall in interest rates would further
strong equity growth to yield the best return. A more likely boost secondary market values. Successful activity on the
compromise therefore would be a capped participation secondary market can be achieved but does require frequent
product which boosts the equity exposure up to the cap level and accurate monitoring and sufficiently strong product
and would provide a higher return in the event of moderate growth to overcome the initial bid-offer spread of the product.
equity growth. There is also a perception that equity markets
are quite expensive, the S&P 500 for example sits at less than Therefore, we can deduce that the current low volatility
five percent from its all-time high near the end of 2021 making environment will present interesting new opportunities in
capped products more logical. product issuance and secondary market activity.

By contrast, lower volatility levels make the standard at risk Disclaimer: the views, information or opinions expressed
equity linked products less attractive because the premium herein are those of FVC, and do not necessarily reflect the
generated is much less. These include capital-at-risk autocalls views of SRP.

Generally, distributors have set barrier levels at those

which reduce risk to capital but does not lose all the
advantages in terms of yield or return

www.structuredretailproducts.com 47
 SPOTLIGHT

Spotlight on…
a record month in the US
Some US$13.7 billion was collected from 3,622 newly issued structured products in August 2023
– the highest monthly sales volume recorded in the US market since the launch of the SRP US
database in April 2006.

US: Sales & issuance between August 2022 and August 2023

14,000 4,000

12,000 3,500

3,000
10,000

2,500
8,000
2,000
6,000
1,500

4,000
1,000

2,000 500

0 0
Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23

Sales US$m (LHS) Issuance (RHS)

Source: SRP

Sales volumes increased by 34% sales of US$450m. It pays an annual decreased: from 36.5% in August 2022
compared to August last year and coupon of four percent, whilst at to 29% in August this year.
by 35% month-on-month (Jul 2023: maturity, providing the share closes at or
US$10.1 billion). The previous high was above 132% of its starting price, it offers Products linked to single stocks saw
seen in September 2022, when US$12.4 75.6% participation in the rise of the their market share increase to 13.8% -
billion was gathered from underlying. up 4.9 percentage points YoY. The 657
3,268 products. structures in question collected US$1.9
The 1,312 products linked to an index billion with the shares of Tesla (56
The top issuers in August included J.P. basket sold a combined US$4.3 billion – products), Nvidia (50), and Amazon (48)
Morgan, Barclays Bank and Citigroup the equivalent of a 31.2% market share, the most frequently used.
with a market share of 19.5%, 12.8%, and up 10.8 percentage points year-
and 12%, respectively. Goldman S on-year (YoY). Compared to July 2023, ETF-linked produc ts also increased
achs captured 11.8% of the US market sales of index basket-linked structures their market share (+0.90%), with the
while Bank of America completed the increased by US$1.4 billion. 192 products on offer during August
top five (6.6%). selling slightly more than US$700m.
Nine hundred products worth US$4
Barclays was the manufacturer behind billion were tied to a single index, Thirty-six percent of ETF-linked sales
the best-selling product of the month. including 561 linked to the S&P was invested in products linked to SPDR
The bank’s Synthetic Convertible 500. Although sales volumes were S&P 500 ETF Trust, with a further 17%
Notes (06741W7A2) on the Class A up US$300m YoY, the market share invested in products linked to Energy
common stock of Alphabet achieved for products linked to single indices Select Sector SPDR Fund.

48 www.structuredretailproducts.com
 SPOTLIGHT

Spotlight on…
issuers in South Korea (Q2 2023)
Some KRW16.4 trillion (US$12.5 billion) was collected from 5,221 structured products
(excluding flow- and leverage) in the second quarter of 2023 – an increase of 11% by sales
year-on-year (YoY).

Average volumes, at KRW3.1m per product, South Korea: Top 10 issuer groups - Q2 2022 vs Q2 2023
were level from the prior year quarter.
100%
Approximately 84% of total sales was
Others
invested in 3,904 products targeted at 90%
retail investors with the remaining volumes Nonghyup
80%
coming from private placements.Twenty- KB Financial
two issuer groups – mainly local securities 70%
houses – were active during the quarter, Kyobo

the same number as in Q2 2022. 60% Kiwoom Securities

50% Samsung Securities

Hana Financial was the number one
issuer in the quarter. The company 40% Mirae Asset

claimed 17.2% of the Korean market, up Shinhan Financial

30%
7.2 percentage points YoY – the biggest
increase of any issuer group in Q2. 20%
Shinyoung Securities

Meritz Securities
10%
Hana issued 452 products worth KRW2.8
Hana Financial Group
trillion, with almost 50% of its sales 0%
coming from products linked to an equity Q2 2022 Q2 2023
index basket and a further 35% tied in Source: SRP
products on the interest rates.

In second place, Meritz Securities There was certainly not much between Kiwoom (5.9% market share) was
captured 9.6% of the Korean market Shinyoung Securities and Shinhan responsible for the best-selling product
in Q2 2023 – down from 11.4% in Financial – in third place and fourth of the quarter, collecting KRW219.6
Q2 2022. The firm achieved sales of place – which held a market share of billion with Dream ELB 365. The one-year
KRW1.6 trillion from 298 products that 6.5% and 6.4%, respectively. The former digital offers 104.4887% at maturity,
again mostly focused on baskets of gathered sales of KRW1.1 trillion from providing the underlying share of
equity indices (62% of all sales) often 302 products while Shinhan sold 402 Samsung Electronics closes at or above
including the S&P 500, Eurostoxx 50, products worth just under KRW1.1 its initial level on 26 June 2024.
and Nikkei 225 or Kospi 200. trillion.Just behind those two, Mirae
Asset completed the top five with a The best performing product of the
Margins were tight in Korea, with the next 6.3% market share (Q2 2022: 7.6%) that quarter was Kiwoom New Global 100tr
eight issuers that completed the top 10 was achieved from selling 449 products Club ELS 589, which returned 109.25%
separated by only 1.1 percentage points. worth KRW1.1 trillion. (40.48% pa).

Hana Financial and Meritz Securities stood out from the competition
in a quarter that saw sales increase by 11% YoY

www.structuredretailproducts.com 49
 PRODUCT WRAP

Product wrap:
In this wrap, we look at a selection of structured products with strike dates between
19 June and 6 October 2023.

EUROPE Bpost Bank distributed Social Bond Callable Interest 10/2027

in Belgium. The four-year medium-term note (MTN) pays a fixed
annual coupon of 5.30% (3.71% after withholding tax) during
Gan Patrimoine marketed Porphyre Septembre 2023 in France. the first two years of investment. The following years, a variable
The eight-year life-wrapped structure offers access to the coupon equal to three times the difference between the 30-year
MSCI EMU Social Leaders Select Top 30 5% Decrement Index, EUR constant maturity swap (CMS) rate and the five-year EUR
which tracks the performance of a set of 30 companies from CMS rate, is paid. From the end of year two, BNP Paribas Issuance
the European Economic and Monetary Union region with the BV (the issuer) can decide to call the product for a capital return
highest free float adjusted market capitalisation that also have of 100%. The funds raised with this issue are allocated exclusively
a robust Social Pillar Score. The product has a knockout feature to finance initiatives that are identified by BNP Paribas as having a
that is triggered if the index closes at or above its initial level on positive social impact on a target audience: access to education,
any annual valuation date. In that case, it returns 100% of the housing and health services, local economic development, socio-
nominal invested, plus a coupon of nine percent for each year economic independence. Priips Summary Risk Indicator (SRI): one
that has passed. The product is not a green bond or other type out of seven.
of sustainable investment; however, Morgan Stanley (the issuer)
is committed to paying the National Geographic Society a Deutsche Bank gathered €29.9m (US$31.5m) with the Green
donation equal to 0.20% of the nominal value. The unconditional Floating Rate Note in Spain. The two-year product pays an annual
gift will be at least equal to €20,000 Euros and will be used coupon equal to the three-month Euribor, subject to a minimum of
to finance the efforts of the National Geographic Society for two percent and a maximum of four percent pa. Deutsche intends
conservation and exploration of oceans. Priips Summary Risk to apply the proceeds from the offer specifically to finance or
Indicator (SRI): four out of seven. refinance both loans to and investments in corporations, assets,

Europe: top 10 issuer group by issuance - 19 Jun to 6 Oct 2023*

UBS

Vontobel

Julius Baer

Leonteq

Zuercher Kantonalbank

J.P. Morgan

Barclays

Raiffeisen Switzerland

BNP Paribas

Société Générale

0 3,000 6,000 9,000 12,000 15,000 18,000

*Excluding flow- and leverage products Source: SRP

50 www.structuredretailproducts.com
 PRODUCT WRAP

projects and/or activities that promote climate-friendly, energy The product is subject to a minimum investment of £5,000 and
efficient and other environmental purposes. The product is listed is available for individuals; stocks and shares Isa/Isa transfers;
in Luxembourg. Priips SRI: one out of seven. pension schemes; and for trustees, companies, and partnerships.
Meteor will receive a fee of up to 1.50% for marketing and
Santander collaborated with Goldman Sachs International for administering the plan. Priips SRI: one out of seven.
the launch of Certyfikaty z Ochroną Kapitału w PLN in Poland.
The 1.5-year certificate offers a return linked to the performance Wilgenhaege launched Double Digit ASR-L’Oréal in the
of two shares: Visa and PayPal. At maturity, the product returns Netherlands. The five-year Athena autocall is linked to two
100% of the nominal invested plus a coupon of seven percent, shares: ASR Nederland and L’Oréal. Every year the performance
regardless of the performance of the underlying shares. However, of the shares is measured and if both close at or above their
if both shares close at or above their strike price, an additional initial level on the annual validation date, the product redeems
coupon of 2.50% is paid. This product is not listed. Priips SRI: two early, returning 100% of the invested capital, plus a coupon of
out of seven. 16.20% for each year that has passed. At maturity, the European
barrier for soft capital protection is 70%. The product is issued
Equity Protection con Cap e Cedola con Effetto Memoria e Lock- via SG Issuer with Société Générale acting as the guarantor.
in was distributed in Italy via Banco BPM and Banca Aletti. The Priips SRI: six out of seven.
five-year investment certificate is linked to the Eurostoxx 50 and
offers a conditional annual memory coupon of 4.60%, providing
the index closes at or above its initial level on any valuation date.
Once the conditional coupon is paid, the lock-in mechanism is AMERICAS
activated, and the coupon is guaranteed for the remainder of the
term. At maturity, the product offers 100% capital return. Banca
Akros is the calculation agent. A commission of 2.90% applies. Barclays Bank’s Synthetic Convertible Notes (06741W7A2) on
Other charges of 1.19% and a structuring cost of 0.725% are the Class A common stock of Alphabet is the best-selling US
included in the issue price. Priips SRI: three out of seven. product in 2023 to date. The three-year registered note, which
is targeted at institutional investors, sold US$450m in August.
Meteor Asset Management introduced Recallable Fixed Growth It offers a fixed coupon of four percent per annum. At maturity,
Plan September 2023 (CA) 7738 in the UK. The five-year product the product offers minimum 100% capital return. However, if the
is issued on the paper of Crédit Agricole CIB, which can call the final level of the underlying share is at or above 132% of its initial
product – annually, from the end of year two onwards – for a level, the product offers an additional return equal to 75.6% of
payout of 100%, plus a coupon of seven percent for each year the rise in the share. The initial issue price is US$108.90 while the
elapsed. At maturity, the plan will pay an investment return of 35%. estimated value of the notes is US$107.30.

Americas: top 10 issuer group by issuance - 19 Jun to 6 Oct 2023*

J.P. Morgan

Citi

UBS

Goldman Sachs

Barclays

Morgan Stanley

Monex

Bank of America

BBVA

RBC

0 500 1,000 1,500 2,000 2,500 3,000

*Excluding flow- and leverage products Source: SRP

www.structuredretailproducts.com 51
 PRODUCT WRAP

Asia Pacific: top 10 issuer group by issuance - 19 Jun to 6 Oct 2023*

HSBC

DBS

Morgan Stanley

Siam Commercial Bank

UBS

Bank of China

Bangkok Bank

Kiatnakin Phatra Securities

Nomura

Société Générale

0 2,000 4,000 6,000 8,000 10,000

*Excluding flow- and leverage products Source: SRP

In Canada, The Bank of Nova Scotia sold BNS Cyber Security product is callable on any interest payment date from the end
Basket Callable Contingent $14.01 Coupon Notes, Series 5 of the first year onwards. Barclays is both the bond provider
(CAD). The five-year Phoenix autocall offers access to an equally and derivatives counterparty for this product, which was
weighted basket comprising three shares from the software & also available via YM Securities, Chugin Securities, Barclays
services sector: Zscaler, Crowd Strike Holdings, and Cloudflare. If Securities Japan, Gungin Securities, Nanto Mahoroba
the worst performing share is above 60% of its initial level at any Securities, and 77 Securities.
observation date, the product pays a fixed Coupon of 14.01% pa.
Otherwise, no coupon is paid. HSBC Bank issued 股票掛鈎投資2023/Basket DCDC ELI
DFBAS2303054 in Hong Kong SAR. The three-month daily cash
BBVA accumulated sales of MXN68.2m from investors in Mexico dividend callable product is linked to a basket of two shares:
with an Accrual Range Note linked to the appreciation of the US Bank of China (H Shares), Agricultural Bank of China (H Shares).
dollar relative to the Mexican peso. At maturity, the product offers The product has a daily autocall condition and a knock-in feature,
100% capital return, plus 4.3746% pa prorated for the number which is set at 97%. The exercise price is between 97.95% and
of business days in the investment period when the USD/MXN 100% of the initial spot price and the call price is set at 105%. The
is equal to or greater than 16.6035, and equal to or lower than fixed cash dividend rate is 0.92%.
17.7035. Otherwise, the product offers a capital return of 100%.
Shanghai Pudong Development Bank targeted 上海浦东
XP Investmentos launched XP Índice de Tecnologia 发展银行个人银行结构性存款/30D CNY Structured Deposit
Bidirecional in Brazil. The five-year capital protected note 24012314 at retail investors in China. The product has a tenor of
features the twin-win payout and offers access to the 30 days and is linked the appreciation of the euro relative to the
proprietary Solactive XP Indice de Acoes Americanas de US dollar. At maturity, if the EUR/USD is above 104.5% of its initial
Tecnologia VT 19% Index. At maturity, the product offers 100% level, the product offers 100% capital return, plus a coupon of
participation in the positive performance of the index. 2.65% pa. If the currency pair is at or above 96% and at or below
104.5%, the product offers 100% capital return plus a coupon of
2.45% pa. Otherwise, the product offers 100% capital return plus
ASIA PACIFIC a coupon of 1.3% pa.

In South Korea, Dongbu Securities launched DB Happy Plus

Okigin Securities sold JPY5.8 billion (US$39.2m) worth of DLS 763. The six-month digital is linked to the Korea Treasury
固定利付コーラブル債/Callable Interest Rate linked Bonds Bond 3M. At maturity, if the final spot rate is at or above 95%, the
M20280929 in Japan. Every six months during the five-year product offers 100% capital return, plus a coupon of 2.2301%.
term, the product offers a fixed coupon of 0.81% pa. The Otherwise, the capital return is 99%.

52 www.structuredretailproducts.com
 PEOPLE MOVES

People moves

LBBW head of certificates moves to Singapore in Since 2016, he has been in charge of trading and risk
Apac push management for equities and equity derivatives, with a focus on
the bank’s certificates business, as well as product management.
In addition, Krüger is voluntarily involved as a member of the
The German lender is expanding its board of the German Derivatives Association (DDV).
financial markets business in Asia.
Krüger’s current position in Stuttgart will be temporarily taken
Landesbank Baden-Württemberg (LBBW) over by Dr. Thilo Rossberg in parallel to his duties as head of the
has appointed Jan Krüger (pictured) as FICC markets department until the succession is permanently
its new head of capital markets for Asia arranged.
Pacific (Apac) in the Singapore branch.
Being present for its clients internationally with a broad variety
Krüger, previously head of the equity of products and expertise has become increasingly important
markets department and, amongst others, responsible for to LBBW, which has been expanding this business segment for
LBBW's certificates business will head the newly established several years as part of its Asia strategy.
financial markets Apac department from 1 September.
‘We are pleased that we have been able to win a top executive
Krüger has been working for LBBW in Germany since 1991, and from our own ranks with more than 25 years of capital market
since 2000 in various leading positions in the capital markets experience to support our growth in Asia,’ said Dr. Christian
business on both the trading and sales side. Ricken, LBBW member of the board of directors, responsible

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for the capital markets business, asset management and corporate derivatives trading. He continues to report to Honda.
international business.
Dinesh Gurnani is now head of corporate derivatives trading,
Jens Rübbert, Apac head of LBBW added: ‘The reorganisation of Apac – an expanded mandate from his previous coverage of Asia
LBBW's financial markets business in Singapore with Jan Krüger ex-Japan. He reports to Ryoichi Irisawa for Japan and Lannic for
in the lead is an important milestone to further strengthening and Asia ex-Japan.
expanding our regional financial markets strategy.’
As part of structured EQD trading team, Haruno Tani is named
head of equity quantitative investment strategies (QIS) trading,
Japan. Tani is responsible for expanding the QIS business
Nomura hires EQD trading heads from US banks by working with the fixed income unit as well as other global
stakeholders. She continues to report to Ryoichi Irisawa.

The Japanese bank on 2 August revealed The latest people move in EQD trading follows the recent
six management appointments across appointments of John Goff and Rany Moubarak within global
its Apac equity derivatives (EQD) trading, markets at Nomura, whose respective roles are senior managing
including three new joiners from US banks. director, global head of structuring, and managing director, head
of global markets, the Middle East and Africa. Moubarak reports
The appointments were announced by to Goff.
Arnaud Lannic (pictured), head of equity
products, Asia ex-Japan, based in Hong
Kong SAR and Tsukasa Honda, head of
equity trading, Japan, according to an internal memo seen by Goldman appoints head of the third-party wealth
SRP. business

The new additions are Tomiyuki Oji, Vikas Kumar, Sachin Tulshyan,
Ryoichi Irisawa, Dinesh Gurnani and Haruno Tani. Goldman Sachs is doubling down on its
coverage of the registered investment
Tomiyuki Oji joins as head of index flow derivatives trading, Asia advisor (RIA) segment in the US despite
Pacific (Apac) from Goldman Sachs where he managed Apac the sale of its Personal Financial
single stock and index derivatives trading. Oji reports to Lannic Management unit and the embedding of
for Asia ex-Japan and Honda for Japan. its consumer finance platform Marcus into
the unified asset and wealth management
Vikas Kumar is named as head of equity derivatives trading, Asia division.
ex-Japan. Most recently, he worked for Bank of America (BoFA)
in London where he led exotics trading across Europe and Asia. Through our suite of products across GBM and AWM [...] we
Kumar reports to Lannic, who joined Nomura in May, also from have an unparalleled solution set to help RIAs run and grow their
BoFA where he was head of equities client solutions trading, businesses
Europe, the Middle East and Africa (Emea) till April 2021.
The US bank has appointed Adam Siegler (pictured), head of the
Kumar was licenced with BoFA from August 2009 to May 2023, third-party wealth business, Americas, within the global banking
according to the UK’s Financial Conduct Authority (FCA). and markets division to lead the One Goldman Sachs Registered
Investment Advisor strategy, an initiative to bring its capabilities
Another new joiner is Sachin Tulshyan, now responsible for India across divisions to the US RIA market, according to an internal
delta one trading, flow index and structured financing, Asia ex- memo seen by SRP.
Japan. He is tasked with growing the equity products platform
across linear and non-linear structures, and reports to Abhishek Siegler was made managing director in 2019 and took
Gupta and Kumar. responsibility of the bank’s Private Investor Products Group
(PIPG) in the Americas, which focuses on the pricing, distribution,
Previously, Tulshyan worked for Citi where his roles included head origination and trading of securitised derivative products across
of India equity trading and emerging market flow trading as well all major asset classes. It is targeted at private banks, retail banks,
as head of Apac futures, clearing and foreign exchange prime online brokers and other distributors that provide structured
brokerage. He was based in Singapore from August 2021 to May solutions to high net worth or retail investors.
2023 after spending14 years in Hong Kong SAR, according to
the local regulators’ licence records. In his expanded role, Siegler will work with teams across global
banking & markets (GBM) and asset & wealth management
In addition, Ryoichi Irisawa has been appointed head of (AWM) to provide an ‘integrated and comprehensive approach’ to
structured derivatives trading, Japan with experience in serving its RIA clients.

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According to the memo signed by Cyril Goddeeris, global equity researcher in Sydney before he moved to New York as an equity
financing, co-head of global prime services, and head of global derivatives trader covering Latin America.
securities lending and synthetic trading; Kevin Kelly, global
co-head of prime services; and Padi Raphael Partner, global SRP has learned that Frederic Cosmao will replace Grisey as
head of third-party wealth business in Goldman Sachs Asset head of equity structuring, Apac, based in Tokyo. Cosmao
Management, RIAs are the fastest growing segment in the US has held different senior roles in equity derivatives and QIS
wealth management space. structuring across the region, including leading the team in Japan
successfully for the past five years.
‘Through our suite of products across GBM and AWM, inclusive
of custody, asset management, capital markets products, and Based in Hong Kong SAR, Cosmao has been charged with
lending and banking solutions, we have an unparalleled solution growing BNP Paribas’ private banking & distribution and
set to help RIAs run and grow their businesses,’ stated the memo. institutional solutions businesses in the Apac region.

In addition to his new firmwide responsibilities, Siegler will In his new role, he reports to HK-based Vincent Desmarest, head
continue to lead the Americas retail client segment for equities, of global equities, Apac, and Hamzah Kahloon, head of global
the PIPG, Goldman Sachs Advisor Solutions (GSAS) and Goldman markets structuring, Apac. Globally, Cosmao reports to Azad
Sachs Select in GBM. Mahavar, global head of equity derivatives structuring.

Siegler joined Goldman Sachs in 2018 as vice president, head Cosmao has also spent over 20 years at BNP Paribas. He started
of private investor group Americas, and was named managing at the bank’s mutual funds trading and structuring team in Paris
director in 2019 – he joined Goldman from Barclays Investment before he moved to the systematic strategies group for Global
Bank where he spent almost 10 years as a director, equity Equity & Commodity Derivatives (GECD), also in Paris.
derivatives. He transferred to Barclays in September 2008
following the collapse of Lehman Brothers where Siegler was an In this role, he was in charge of the entire production chain for
associate for almost three years. all the volatility-related strategies, from algorithm design to
performance reporting.

Cosmao also spent time in various structuring and trading

BNPP beefs up Americas EQD structuring team, positions in Paris, Hong Kong SAR and New York.
relocates Apac head

Etienne Grisey, managing director and Natixis reinforces Latam sales

head of global equities structuring, Apac,
at BNP Paribas, has been appointed co-
head of EQD structuring, Americas, in New Natixis has hired Gerardo Gomez, Andres Bachor, and
York. Guillermo Diez to the LatAm Sales team to ‘expand its emerging
markets and Latin America platforms to diversify offerings for
The move comes 12 months after clients worldwide’.
Grisey’s latest promotion. He relocated to
Singapore from Hong Kong SAR in July The new hires will join Jorge Segui and Thomas Maslowski to
2022 to take on his previous role, which sits under the global round out the French bank’s New York-based team, and report to
equities division along with the global macro and the global Gregory Fage, head of macro sales Americas.
credit units following the new global markets business structure
launched earlier this year. The new hires will join Jorge Segui and Thomas Maslowski to
round out the French bank’s New York-based team, and report to
Prior to that, he served as Apac head of equity derivatives Gregory Fage, head of macro sales Americas.
structuring at the French bank with responsibility for equity
derivatives structuring and quantitative investment strategies Gomez has experience in global markets with a focus on fixed
(QIS) structuring for institutions in Asia ex-Japan. income and derivatives. He joins from BBVA South America,
where he was head of corporate derivatives coverage for Brazil
Before moving to Singapore, Grisey (pictured) spent 13 years in and Chile and oversaw project finance derivatives for South
Hong Kong SAR as head of equity derivatives structuring, Asia America.
Pacific. He also spent two years in Japan at the bank’s equity
derivatives structuring team after a four-year stint in equity Bachor joins from BBVA Securities, where he was part of
derivatives pricing, in New York. the LatAm sales team responsible for the development and
distribution of credit, FX and rate products in the region. Prior to
Grisey joined BNP Paribas in 2002 as an equity derivatives quant that, he served in the emerging and global markets divisions at

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Deutsche Bank, Nomura, Barclays as well as Banco Galicia based management. Previously, Oden held various roles at Merrill
in Buenos Aires. Lynch including head of advisor strategy, head of global product
strategy and market executive for the New York fifth avenue
Diez joined Natixis in 2021 in the institutional & corporate FX market, which serves high-net-worth individuals and institutions.
& cross assets derivatives sales team in Madrid, and was also She had also spent 10 years at UBS after kicking off her career at
previously part of global corporate coverage and LatAm FX, rates Morgan Stanley in equity trading.
& credit sales for Deutsche Bank and Santander respectively.

The LatAm Sales team will focus on enhancing client activity

overall under the global emerging markets platform. SIX appoints global head from Nasdaq

The Swiss exchange has appointed

HSBC poaches DB regional CEO to head Apac Bjørn Sibbern (pictured) as global head
global private banking exchanges and member of the executive
board of SIX, effective from 1 January
2024. Sibbern is currently serving as
In Asia Pacific (Apac), Lok Yim (pictured) executive vice president and president
will become HSBC's regional head of global of European markets at Nasdaq and
private banking on a designate basis on will replace Christoph Landis, who has
1 November and will formally start on 1 headed up the exchange business of
January 2024. He joins from Deutsche SIX on an interim basis since February. Landis will return to his
Bank and succeeds Siew Meng Tan, who previous role as head IT and member of the SIX executive board.
is retiring after an almost 40-year career in
banking. Tan has been in the role for seven Bjørn Sibbern will head up the exchange business at SIX as a
years during her 20 years at HSBC. member of the SIX Executive Board (ExB) from 1 January 2024.
He has spent 20 years in the global exchange arena, specialising
Yim will continue to be based in Hong Kong SAR and report to in trading, funds, post-trade, listings, IPOs, data, indices and
Annabel Spring, CEO, global private banking and wealth, on a technology. He will be responsible for both the Swiss and
functional basis, and Kai Zhang, head of wealth and personal Spanish exchanges at SIX, as well as the digital exchange SDX.
banking, South Asia on an entity basis.
Previously, Sibbern was executive vice president for Nasdaq’s
During his 16 years at Deutsche Bank, Yim most recently as global information services (GIS), based in New York City, after
CEO, Hong Kong SAR, having spearheaded the bank’s wealth leading Nasdaq’s global commodities business and served as
management and international private banking franchises in Asia president of the Nasdaq Copenhagen Exchange. Prior to that, he
and emerging markets. He had also held senior roles at Citi. managed Nasdaq’s Nordic cash equities and derivatives markets.

HSBC names US head of wealth and personal Wells Fargo appoints head of equity capital
banking markets

Effective from December, Racquel Jill Ford (pictured) has joined Well
Oden (pictured) will join HSBC as head Fargo’s corporate & investment bank
of wealth and personal banking (WPB) as head of equity capital markets. She
from J.P. Morgan. She will be responsible reports to Tim O’Hara, head of banking,
for overseeing the bank’s wealth based in New York.
management, global private banking and
retail businesses in the US. With 30 years of investment banking
experience, Ford was most recently co
Based in New York, Oden will report to head of equity capital markets Americas
Michael Roberts, CEO, US and Americas, and Juan Parma, head after working for Credit Suisse as head of the ECM Americas
of wealth and personal banking Americas. Syndicate. At Credit Suisse, she also co chaired the equity
valuation committee and sat on the investment banking &
At J.P. Morgan, she most recently served as head of network capital markets (IBCM) global operating committee. Jill was
expansion for consumer banking after leading national sales and head of the Credit Suisse Americas Women’s Network for six
the Northeast division for both consumer banking and wealth years and served on the firm’s corporate insights advisory

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council, global ESG steering committee and the IB ESG ‘[Shannon’s] extensive expertise in capital markets and
strategic initiatives forum. Additionally, she had held debt trading technologies, coupled with his deep understanding of
capital markets and M&A investment banking roles across UBS, institutional investors' needs, will allow us [to] deliver enhanced
Montgomery Securities and First Boston. value from our unique data and analytics,’ Geliot said in an
earlier statement.

Shannon will be responsible for implementing and scaling

DB appoints former CS executive as head of Swiss Premialab’s new technology and execution initiatives, providing
structured solution sales unique data, analytics, and execution solutions to institutional
investors globally.

Deutsche Bank has made a recent The fintech company has hired several senior executive roles
senior hire within its investment bank within the banking industry, including Daniel Fields, senior
in Switzerland. As of December 1, advisor for Americas, who served as the former global head of
Michael Vonmoos (pictured) will join markets at Société Générale; and Georgios Sittas, managing
the bank in Zurich as managing director director, head of risk solutions, who worked as the managing
and head of structured solutions sales director at HSBC, Standard Chartered and previously director
Switzerland. In this role, Vonmoos will at Lehman Brothers.
report to Leonardo Doser, who has
led the bank’s markets distribution
Switzerland for almost three years. Vonmoos has more than
16 years of experience in derivatives and structured products, Credit Suisse EQD exodus continues
most recently as head of structured products & institutional
solutions sales Switzerland at Credit Suisse. He also currently
serves as board member of the Swiss Structured Products Roberto Rosas (pictured) has joined
Association (SSPA). Barclays as director, head of structured
product sales for Latin America (Latam).
“With this hire, Deutsche Bank continues to strengthen its Based in New York, Rosas reports to
Markets business in Switzerland,” stated the bank. Shikha Jindal, managing director, head of
structured product distribution for private
The appointment is part of the bank’s push on the DCM/ banks and Latam, SRP has learnt.
Syndicate side, with the hiring of Rosario Clemente and other
DCM/Syndicate professionals. Deutsche Bank will onboard His registration with Barclays Capital went
further new joiners on the rates side by December. effective from 31 July, according to Finra’s BrokerCheck.

‘This strategic hire marks a significant milestone in our Rosas joins the UK bank from Credit Suisse in New York where
expansion strategy and reaffirms our commitment to the Swiss he spent almost five years in the bank’s equity derivatives and
market,’ said Doser. investor product sales team. He was promoted to director from
vice president in December 2021. Prior to that, Rosas was an
associate, multi-asset structured products and derivatives sales
for Latam, also based in New York.
Premialab adds new role
In addition, Mandy Xu has joined US derivatives and securities
exchange Cboe Global Markets as vice president, head of
Alan Shannon (pictured) has joined derivatives market Intelligence, based in New York.
Premialab, a fintech platform specialising
in quantitative investment strategies, as Most recently, Xu was managing director, head of equity
its head of technology solutions, a newly- derivatives strategy at CS, specialising in index and ETF volatility
created role as the firm is expanding its research.
product reach, a spokesperson told SRP.
In her new role, she will be responsible for producing ‘high-level
Based in London, Shannon joined from insights and analysis on derivatives market themes and flows,
the capital markets consultancy firm with a focus on furthering client education on Cboe's markets
First Derivatives, where he held the position of head of EMEA and its leading suite of derivatives products’, stated Cboe.
consulting. Previously, he served as senior delivery manager at
Morgan Stanley and project manager at RBC Capital Markets and Xu spent 13 years at CS. Prior to joining the Swiss bank she
UBS. In his new role, Shannon reports directly to Adrien Geliot, worked as a cross-border M&A analyst at E.J. McKay, a boutique
the firm’s co-founder and CEO. investment bank in Shanghai.

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BBVA boosts credit markets team FTSE Russell names head of index sales, Asean &
South Asia

The Spanish bank has appointed Juan

Blasco (pictured) as the new head of Matthew Henshaw (pictured) has
the global credit markets unit to replace been tapped to lead the index sales for
Regina Gil, who has moved to lead BBVA Association of Southeast Asian Nations
CIB’s division in the US. (Asean) and South Asia at FTSE Russell.
He will continue to be based in Singapore,
‘In recent years, BBVA CIB has registered reporting to Rick Chau, head of index and
a substantial increase in the volume of analytics sales for Apac at FTSE Russell,
issuances and trading in bond markets, as SRP has confirmed.
well as greater requirements for excellence in the execution and
customization of solutions,’ stated the bank in a release. Chau returned to the index provider in March from Qontigo where
he was managing director, sales head for Asia Pacific (Apac). He
Since 2016, Blasco has been the head of global syndicate and had a two-year stint at FTSE in Hong Kong SAR before moving
leveraged finance Emea at BBVA, previously leading different to STOXX in 2017. Previously, he was head of exchanges, Asia
teams in the global credit markets value chain. Pacific & head of index coverage, Hong Kong (sell side/hedge
funds) & Taiwan, at MSCI, since 2010. His role at Qontigo has
The credit business strategy will be reinforced by been filled by Charlene Low.
strengthening existing capabilities in developed markets;
expanding the emerging markets portfolio with products from In his new role, Henshaw is responsible for developing index
new markets; and developing a new area of tailor-made credit solutions with the local pension schemes, asset managers,
solutions for its clients (credit solutions), together with the banks and hedge funds in the region. He works closely with
investment banking & finance unit. the local asset management and banking community to
design and launch strategic Index initiatives across FTSE
Russell’s full suite of asset classes.

HKEX names head of listed issuer regulation Most recently, Henshaw was senior manager, business
development after relocating to Singapore from London in January
2022. In London, he became co-head of sales for UK and Ireland in
Hong Kong Exchanges and Clearing January 2020 after covering the whole European market.
(HKEX) has appointed Catherine Yien
(pictured) as the new managing director,
head of listed issuer regulation in the
listing division. Citi taps markets veteran to lead Apac commercial
bank
Yien, who joined on 1 September,
succeeds Christine Kan, who will be
retiring from the group after 27 years Effective from 1 September, Gunjan
of service. The two executives will ‘work together to ensure Kalra (pictured) will become Apac head
a smooth transition’ before Kan retires on 31 December, of commercial bank at Citi, and report
according to HKEX’s announcement. to Tasnim Ghiawadwala, global head
of commercial bank, and Peter Babej,
Yien joins HKEX from Rothschild & Co, where she has worked Apac CEO at Citi, according to an
for nearly 28 years and served in various roles, including announcement from Citi.
director and chief operating officer and compliance officer.
Most recently, she was the managing director of the firm’s Currently Kalra is managing director, Apac
global advisory team. head of corporate sales & solutions at the US bank’s markets
division where she leads the delivery of markets products to
In her new role at HKEX, Yien will lead the team responsible corporate and commercial banking clients in the region that
for the frontline regulation of over 2,600 listed issuers in Hong covers 11 markets.
Kong, supporting issuer understanding and compliance with the
listing rules and working with directors and senior executives Kalra has spent 21 years at Citi where she started in the
across the issuer space. investment banking division in New York before moving to
the commercial banking unit in Singapore in October 2018,
Yien will officially assume the role on 1 January 2024 and report according to her registration records with local regulators. Kalra
to Katherine Ng, head of listing at HKEX. will continue to be based in Singapore.

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