A high-profile move at Citi, regulation moves in Canada and Monex first to move into Sofr in Mexico

Matt Watson, head of issuance for equity products at Citi in London, has parted ways with the US bank. He left after more than 25 years at the bank where he held a number of senior roles after becoming a managing director in 2017. Prior to his latest role as head of issuance for equity products, he was in charge of one of the pillars launched by the bank in 2019 covering institutional and retail clients - he was in charge of the issuance of structured notes and special purpose vehicles globally. Bhaavit Agrawal, global head of rates & currencies structured notes and markets issuance will oversee the MTN desk and will also effectively serve as Watson’s replacement in his role as global head of markets issuance.

This step will allow us to continue supporting our institutional clients wishing to benefit from services on digital assets - Jean-Marc Stenger, SG Forge

Another North American bank, RBC Capital Markets, has also seen staff moves, appointing Giles Gleave as managing director, head of European equity solutions, in London, according to a memo seen by SRP. Prior to this move, Gleave was head of equity solutions for Emea at Nomura and has also previously held senior positions at investment banks Morgan Stanley Bank of America, and Lehman Brothers. As head of European equity solutions, he is set to expand RBC’s North American corporate equity derivative offering across Europe and work on increasing cross-border connectivity with North America for its European clients.

The Canadian Investment Regulatory Organization is reviving a proposal by the Investment Industry Regulatory Organization of Canada to provide clarity on margin requirements for structured products such as principal-protected notes (PPNs). In its initial proposal, the regulator sought to introduce a fixed margin rate of 70% for structured products, or to allow firms to use an alternative methodology for products with principal protection features. Now, in response to criticism that the 70% rate was too conservative, the organisation’s proposals would allow for a 30% rate for PPNs and a 50% rate for principal-at-risk notes.

Monex Grupo Financiero has launched the first ever product in Mexico linked to the CME TERM Sofr 1M Coupon Range. The new interest rate structure which has a term of 184 days is fully protected and will pay six coupons of 5.90% throughout the term. The product created by Monex’s Derivatives Desk is the first structure in the Mexican Market using the CME TERM Sofr 1M as the underlying and it surge because of reactivate rates structured products.

Over in Europe, Julius Baer saw AuM increase four percent to CHF441 billion (US$510.7 billion) as of 30 June year-on-year (YoY). The growth was driven by ‘net positive developments in global equity and bond markets and net new money inflows, partly offset by a net negative currency impact resulting largely from the strengthening of the Swiss franc against the US dollar and the euro’, according to the bank’s H1 2023 earnings report.

Structured products accounted for five percent of the AuM, or CHF22.1 billion, after equities (31%), investment funds (29%), bonds (15%), client deposits (15%). The proportion is one percent higher than six months and a year ago.

Products linked to ETFs took considerable market share away from those tied to single indices in the first half of 2023 in Poland. An estimated PLN2.6 billion (US$635m) was collected from 62 publicly offered structured products in the first half of 2023 – up 13.5% by sales volume year-on-year (YoY), according to SRP data.

Products linked to a worst-of basket of shares captured 34% of the market, just about edging those tied to a single equity index, which claimed a market share of 32%.

Société Générale (SG) Forge has obtained a regulatory licence approval as a digital asset service provider (DASP) in France. The licence approval means that SG-Forge becomes the first licensed company to provide services such as buying and selling, custody and exchange of digital assets - the digital assets arm of SG registered the DASP with the French Financial Markets Authority (AMF) in September 2022.

With the DASP license, the SG subsidiary reaffirms ‘its pioneering role in the crypto assets ecosystem,’ according to Jean-Marc Stenger, CEO of SG Forge.

‘This step will allow us to continue supporting our institutional clients wishing to benefit from services on digital assets that meet the highest standards of compliance and banking security,’ he said.

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