In this week’s roundup, we also look at Maybank Indonesia’s partnership with Horizon Software to expand its structured warrants business; Guotai Junan Futures joining Singapore’s derivatives market, Mariner Wealth Advisors scaling structured note investment capabilities with CAIS, and more.

Chiba Bank has announced that chairman Hidetoshi Sakuma will resign at the end of March next year. This comes two months after the regional bank, its subsidiary Chibagin Securities and Musashino Bank received a business improvement order issued by the Kanto Local Finance Bureau for inappropriate sales of structured bonds.

Going forward, we will steadily implement the business improvement plan and report the efforts of Chiba Bank and Chibagin Securities on each company’s website in a timely and appropriate manner

According to the bank's statement, Sakuma will also step down from the board of directors when a general shareholders’ meeting is held next June.

Nine existing and retired executive officers will face a 20%-50% pay cut or pay return requests for three to six months as the bank ‘[takes] seriously the responsibilities of the relevant executive officers who have come face problems in protecting investors with regard to the financial instruments intermediary businesses related to the solicitation and sales of structured bonds,’ stated the bank.

Chiba Bank’s latest move followed the news earlier this summer that the Securities and Exchange Surveillance Commission (SESC) under Japan’s Financial Services Agency (FSA) was urging regulators to punish Chibagin Securities. The SESC said the Chiba-based investment banking firm sold structured bonds that did not match investors’ financial knowledge, transaction experience, asset status and investment purposes ‘over a long period of time’.

SRP previously reported that some 8,424 customers held structured bonds outstanding at Chibagin Securities as of the end of June 2022, of which 2,424 had the highest risk tolerance eligible for purchasing ‘complex products’, said the commission.

‘Going forward, we will steadily implement the business improvement plan and report the efforts of Chiba Bank and Chibagin Securities on each company’s website in a timely and appropriate manner,’ concluded the bank.

Click the link to read Chiba Bank’s overview of the plans for improvement and the prevention of recurrence, and disciplinary actions to persons involved in the administrative actions issued by Kanto Local Finance Bureau.

Maybank’s Indonesia automates warrants market making

Horizon Software, a provider of electronic trading solutions and algorithmic technology for global capital markets, has announced that Indonesia-based Maybank Sekuritas has deployed its Platform for Warrants Market Making to enhance the trading experience for clients.

By utilising Horizon’s platform, Maybank Sekuritas will now be able to provide clients with ‘seamless execution, robust risk management, and real-time market monitoring, resulting in efficient and accurate warrant market-making operations’.

Maybank Sekuritas is among the first clients to go live with Horizon’s warrant market making feature in Indonesia. The firm has introduced 30 structured warrants on the Horizon platform to date.

‘We [have increased] our capacity and capability to provide structured warrants market-making in Indonesia. As the demand for our structured warrants is picking up, it is imperative that we continue enhancing the features to ensure a seamless market-making experience and boost our confidence in listing more structured warrant series in Indonesia,’ said Stefany Chew, Manager of Equity & Commodity Derivatives Indonesia at Maybank Sekuritas.

‘Ultimately, this demonstrates a key pillar of our growth strategy, providing customers with access to cutting-edge technology to better service their clients on a global scale,’ said Emmanuel Faure, head of Apac at Horizon Software.

Mariner scales structured note channel via CAIS

Looking at the financial advisory space, US alternative investment platform CAIS has announced that it will introduce the independent wealth channel to privately-held advisory firm Mariner Wealth Advisors’ separately managed accounts (SMAs) capabilities for structured notes.

Through this launch, Mariner Wealth Advisors will offer a suite of defined income and growth-oriented structured note SMA strategies, accessible to independent wealth management firms, according to CAIS’s statement.

Marc Premselaar (right), senior managing director of capital markets at CAIS, highlighted that structured notes have always been a core product offering in the firm’s alternative investment menus, providing advisors ‘with another useful tool as they seek out higher yields, portfolio diversification, and downside protection’.

‘Expanding our platform’s structured note capabilities for users is consistent with CAIS’ overarching mission: to minimise the barriers to alternative investing for independent advisors and their clients,’ he added.

China’s Guotai joins SGX as the latest derivatives trading and clearing member

Guotai Junan Futures (Singapore) has joined the Singapore Exchange (SGX) as its derivatives trading and clearing member, according to the exchange’s announcement on 6 September.

Guotai Junan Futures is the sole futures and derivatives platform in Singapore of Guotai Junan Securities, which is ‘one of the largest investment banks and securities companies in China providing corporate finance, brokerage, fixed income clearing corporation (FICC) and asset management for its clients,’ SGX stated.

‘Guotai Junan will take this opportunity to actively seize Singapore's huge market space, promote deepening of bilateral financial cooperation between China and Singapore, and focus on building a distinctive brand for cross-border derivative business,’ Dongyuan Luo, vice president of Guotai Junan Securities and chairman of Guotai Junan Futures, said in the statement.

The joint of Guotai Junan Futures brings the total number of trading and clearing members in SGX’s derivatives market to 68 and 28, respectively.

CME Group’s average daily volume soars, launches T-Bill futures

CME Group, one of the world's largest derivatives exchanges, has reported an average daily volume (ADV) of 24.2 million contracts in August, a 14% year-on-year (YoY) increase and the second-highest ADV for August on record.

The derivatives marketplace saw the interest rate ADV jump 22% YoY to 13 million contracts, with a record US Treasury futures open interest of 19.8 million contracts on August 23 alone, according to an announcement.

Following the release of the data, CME Group also announced a day after that it plans to expand its benchmark interest rates offering, with the launch of US Treasury Bill (T-Bill) futures on 2 October, pending regulatory review.

‘As we continue to see record risk transfer in the US Treasury market, our new T-Bill futures will enable clients to hedge exposure to short-term debt with the same value proposition offered across our US Treasury and SOFR complexes,’ said Agha Mirza, global head of rates and over-the-counter (OTC) products at CME Group.

Meanwhile, for August, the derivatives marketplace reported equity index ADV rose by two percent YoY to 6.5 million contracts, while options ADV soared 32% YoY to 4.4 million contracts.