Leonteq has been one of the most active players in the market during the Covid-19 lockdown and after with a number of high-profile developments during the first half of the 2020.
Some of the most relevant initiatives include a strategic partnership with Blackrock to develop and distribute derivative products linked to the asset manager’s funds, and the onboarding of Basler Kantonalbank and South Africa’s Rand Merchant Bank under white-label collaboration agreements.
The Swiss firm has also updated its digital platform LynQs with a new design and navigation system, and announced a partnership with Google Cloud to support its platform scalability by extending its infrastructure to the cloud.
After having worked at Leonteq in 2016 Ricci sees the reunion as a great opportunity as he finds a company that has maintained a unique focus on the structured products business and has the scope to continue growing and expanding.
“Leonteq has been a disruptor in a specific segment of the financial markets targeting financial intermediaries such as wealth managers and private banks since the very beginning, and it has established itself as a leading provider in a very competitive market,” he says.
Ricci wants to leverage the disruption to the execution of products Leonteq has brought and the positioning in its target market to capitalise on new opportunities in the wealth management and private banking space.
“We are well positioned to grow our business,” he says. “We are leveraging our technology to bring to market new solutions and additional services - tools that can help our clients to use these products to their full extent and deliver value to end investors, and ultimately grow the market.”
The technology platform and service offering will remain “differentiating factors for our client franchise as large investment banks tend to primarily focus on larger clients”.
Digital focus
Our philosophy is to provide our clients the tools they need to efficiently operate their structured products portfolio - David Schmid
Leonteq’s vision is to be the leading marketplace for investment solutions as the firm calls its structured products platform LynQs - one of the firm’s key initiatives through which it is shaping its digital transformation.
“Our approach is based on the one-stop-shop concept which provides our clients access to applications and services that were previously only available internally,” says Schmid. “We believe that users should be able to connect to digital platforms and have full visibility of their portfolios and investments regardless of who issued the product.”
Leonteq has recently revamped its real-time set up for notifications and a lifecycle module for clients to monitor their portfolios and the barriers in their positions at any time - this can also be done on the go through the firm’s recently launched mobile app.
“Our philosophy is to provide our clients the tools they need to efficiently operate their structured products portfolio. We are offering this for free for all products on our platform,” says Schmid.
Another key aspect to the one-stop-shop approach of Leonteq is its multi-issuer offering which includes products issued by our white-labelling partners such as Raiffeisen, EFG International, Standard Chartered and others.
“This variety on credit exposure alongside our risk and portfolio analytics and management tools as well as product and investment ideas provide added value to our clients,” says Schmid, adding that investors then can see and understand the risks associated to the respective products, any concentration of risk towards one sector or region, and if the products are performing or not throughout the lifecycle of the investment.
With a 14% market share, Leonteq is the second issuer in Switzerland with 1,799 products worth an estimated US$306m, year-to-date, according to SRP data. As a distributor, Leonteq has marketed 3,430 products worth an estimated US$563m (26% market share), so far this year.
In Europe, Leonteq appears as the manufacturer of more than 6,000 live products most of which were sold in Switzerland (+5,000/US$2.6 billion). Other markets with products issued by the Swiss provider include Italy (587 products/US$1 billion), Germany (351/US$108m), Austria (186/US$33.5m), and Singapore (US$147m). There are more than 10,000 live products across markets with Leonteq acting as the distributor.