The structured product industry has seen a flurry of appointments in October while in the US 3(a)(2) issuances are catching attention.
BNP Paribas Wealth Management Asia named Kin Kei (KK) Wai as head of structured products within its investment services team. Based in Hong Kong, Wai reports to Gabriel Chan, head of investment services, Hong Kong at the French bank.
Also at BNP Paribas, Bruno Boussard, who most recently served as head of group asset liability management treasury and previously as deputy head retail listed products equity derivatives in Paris, was appointed as CEO of Taiwan branches, effective 1 October, subject to regulatory approval.
Robert Stewart, Citi’s Asia Pacific head of derivatives trading operations, has taken up a new position as head of equities trading Asia. Stewart will relocate to Hong Kong from Singapore for the role and report to Fater Belbachir, global head of equities at Citi, who is based in London. Stewart succeeds Arnaud Leteissier, who left the bank to pursue an opportunity at hedge fund Millennium Management as senior portfolio manager in Hong Kong.
Over in the US, SRP reviewed 3(a)(2) issuances that were disclosed to the Office of the Comptroller of the Currency (OCC) in the third quarter. There were nine issuances for accredited investors in the US by ANZ, J.P. Morgan, Morgan Stanley or Citibank between July and September, including one with a 40-year tenor and three with US$1.5 billion notional each.
Corebridge Financial launched its first registered index-linked annuity (Rila) after amassing US$4.3 billion fixed index annuity (FIA) sales in the first six months of 2024.
Corebridge MarketLock Annuity, issued by the company’s subsidiary American General Life Insurance Co, features an exclusive accumulation strategy and offers growth potential and a level of downside protection with index options of the S&P 500 and Nasdaq 100.
Meanwhile, SRP also looked at five of the best performing SEC registered notes in the US during the first half of the year.
The structured products work has strong synergies with other practice areas at the firm, such as our financial institutions, funds, and tax group - Chris Schell, Davis Polk
SRP spoke with Chris Schell, the partner at Davis Polk, after the firm was recognised once again as the ‘Best Law Firm’ at SRP Americas Awards 2024 for its legal support to market players and its guidance around US regulatory focus areas like the Regulation Best Interest and the DOL fiduciary rule.
Schell points at recent developments such as the addition of several new bank clients to its roster in the structured products space, including the recent addition of Royal Bank of Canada – which has contributed to the expansion of the firm's client base and growing market share.
“The structured products work has strong synergies with other practice areas at the firm, such as our financial institutions, funds, and tax groups,” he said. “This allows us to leverage our expertise across the firm to provide comprehensive solutions for our clients.”
Deep diving into the European market, in Belgium, an estimated €1.1 billion (US$1.2 billion) was collected from 24 publicly offered structured products that had strike dates in the third quarter of 2024, according to SRP data.
Some 89% of the total volumes for the quarter was invested in 15 products that struck in September, coinciding with the maturity of a one-year Government bond, which raised a record €21.9 billion in September 2023. Sales volumes registered a 1.9-fold increase compared to Q2 2024 when €365m was gathered from 20 products; year-on-year sales were up 275% (Q3 2023: €285m from 15 products).
FVC’s Suzi Hampson looked at UK product maturities in the third quarter. According to StructuredEdge.co.uk, there were 174 product maturities in the UK during the July-September period.
Of these, 94% were classified as having at least one autocall opportunity, Hampson wrote. Defensive autocalls made up the largest proportion of maturing products with 42% of the total number. There were only 10 products maturing that had a fixed horizon. None of the products returned a loss and only a single product matured paying the initial investment only.
On the regulation front, the European Structured Investment Products Association (Eusipa) has published a position paper on ‘Value for Money’ to contribute to the negotiations on the EU Retail Investment Strategy (RIS).
The document sets out the industry’s core views on the relevant regulatory mechanisms and shows ways to apply a future ruleset on ‘Value for Money’ to structured products and leverage products.
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