Leonteq halts planned market entries in UK, Norway, Finland, China and Korea, targets Japan

Leonteq has announced that 'with a view to further scale the business and exploit further growth potential', the company will be set up as three distinct businesses: investment, banking, and insurance & wealth planning. The Swiss provider of structured investment products and related services said that planned market entries in UK onshore, Norway, Finland, China onshore and South Korea onshore will be discontinued while it plans to open an office in Japan to gain a foothold in the 'largest structured products market worldwide'.

Within the new setup, which will be effective as of January 1, 2017, investment solutions- which encompasses around 76% of the company's 2015 operating income - will concentrate on the manufacture and distribution of Leonteq's and its partner banks' products on the main European and Asian markets, including Switzerland, France, Germany, Italy, Singapore, Hong Kong and Taiwan. The company is targetting an average annual growth turnover of 15% by the end of 2020, which it is hoping to reach with the help of an increase the number of partners and an etension of its client base (of financial intermediaries and institutions).

Banking solutions will leverage the company's complete range of platform services to help midsize retail and private banks establish or enhance their own structured investment products manufacturing and distribution, for which Leonteq will deliver IT as well as add-on services, such as sales advisory training or regulatory and risk management support. Insurance & wealth planning solutions will continue to offer products and services to life insurers and other providers of long-term investments.

Raiffeisen Switzerland and Aargauische Kantonalbank (AKB) have been added as new platform partners, with the first Raiffeisen structured investment products expected to be launched by the end of November 2016. Raiffeisen will be in charge of product distribution to its own channels, while Leonteq will distribute to other channels in Switzerland, Europe and Asia. Notenstein La Roche Private Bank, a subsidiary of Raiffeisen Switzerland, will cease to issue structured investment products under its own name, but will continue to offer Raiffeisen products to its clients.

AKB, one of the leading Swiss cantonal banks with total assets of CHF24.3bn as of December 31, 2015, and Leonteq launched their cooperation in structured investment products. Under their agreement, Leonteq is manufacturer and issuer, while AKB is the guarantor of products. They will be distributed by both companies in Switzerland, and by Leonteq internationally.

Since the announcement of its half-year 2016 results, turnover generated with products of Leonteq's platform partners continued to increase strongly while its own issuance continued to decrease, in line with the first half of the year, according to the company.

In its domestic market, the Swiss bank issued 1,099 structured products with estimated sales of CHF2.7bn (€2.5bn) between January 1 and September 30, 2016, according to SRP data, down in issuance but up in sales from the 1,138 products worth CHF1.8bn that were launched during the same period last year.

'For the next stage of growth, we have developed a clear plan that we will execute over the next four years, and our progress can be measured against the newly-set key performance indicator targets,' said Jan Schoch (pictured), chief executive officer of Leonteq, in a statement.

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