Latest: MUFG partners with UK fintech, automates structured notes offering

MUFG and Origin have launched Origin Documentation, an automated solution for the Japanese Bank’s equity-linked structured notes product offering.

The documentation product forms one part of a broader drive for increased efficiency and improved client experience being led by MUFG’s structured solutions team in Emea and supported by the international equities trading team.

We wanted to re-examine how structured notes, a core product offering for our global markets business, could be improved by challenging the status quo - Alex Pierre, MUFG

‘We wanted to re-examine how structured notes, a core product offering for our global markets business, could be improved by challenging the status quo,’ said Alex Pierre (pictured), interim international business head and international head of structured solutions at MUFG. 

Driven entirely by APIs for both the inputs and outputs, Origin automatically produces term sheets, final terms, and internal execution files for structured note issuance and associated equity-linked exotic derivatives. The new solution supports any equity or index-linked structures, with full flexibility for both cash and physical redemptions, knock-in and knock-out conditions and more. MUFG acts as underwriter, structurer and arranger for all self-issued equity linked structured notes. 

Origin and MUFG partnered to design and develop the solution through 2022, building upon Origin’s documentation product for vanilla debt issuance.

The platform will completely automate the bank’s issuance process involving teams across sales, structuring, operations, and legal, sitting in both Apac and Emea.

‘Origin Documentation continues to evolve and, excitingly, can now be accessed by customers via API as well as via the traditional web-based GUI. This opens a whole new range of use-cases,’ said Raja Palaniappan (above-right), CEO at Origin.

Barclays joins German structured products association

Barclays has become the 15^th member of the German derivatives association (Deutscher Derivate Verband – DDV).

The UK bank has 61 live structured products worth an estimated US$110m listed on the SRP Germany database. Of these, 55 are linked to equities, including 27 products on single equity index and 23 on a single stock.

SRP data shows that the UK bank has a marginal presence in the German market – at present the issuer does not contribute to the DDV’s market statistics. The UK bank however is seeking to meet the highest quality standards in the structured securities markets in Germany.

‘We underline this with our membership in the DDV for our investors and partners,” said Katrin Petersen, MD, head of distribution Germany & Austria.

The DDV represents issuers of structured securities before regulators and is committed to setting  standards, such as for product transparency and sustainability, in the German market.

"We strive to represent the German market comprehensively and to contribute to a modern securities culture with our standards for transparency, fairness and sustainability,’ said Christian Vollmuth (above right), managing director of the DDV.

The DDV is the industry representative body for the leading issuers of structured products in Germany. Other sponsoring members include stock exchanges such as Stuttgart, Frankfurt and gettex and online brokers like flatexDEGIRO, ING-DiBa, Smartbroker and Trade Republic.

Spectrum adds Unicredit to pool of issuers

Spectrum Markets has onboarded UniCredit Bank as the newest member of its pan-European trading venue for securitised derivatives.

Unicredit will initially list a range of constant leverage warrants and covered warrant products, which will be available to retail investors across Europe via banks and brokers. Underlyings will include the most popular European and US equities and indices, with a particular focus on Germany.

‘As retail investors increase in both number and sophistication, it is more important than ever that we stay agile around their needs – developing innovative, tailored investment solutions that enable them to take varied exposures over different time horizons,’ said Marco Formaggio, head of equity & brokerage sales, UniCredit.

The bank will expand the product mix overtime to include short-term, leveraged, and longer-term investment products – with the bank providing liquidity as a market maker.

Spectrum has scaled up its flexible infrastructure to handle the additional volume of order flow and quote data, increasing capacity by over 400% – as part of its strategy to host a focused suite of products linked to the most actively traded underlyings.

‘A key focus for us right now is rounding out the suite of securitised derivatives listed on Spectrum, with a particular emphasis on the most in-demand products and underlyings,’ said Nicky Maan (right), CEO of Spectrum Markets.

‘UniCredit’s vision for its business going forward is very closely aligned with our own, in terms of providing innovative solutions for retail investors, harmonising pan-European trading and making new markets and services more widely accessible.’

UBS launches US critical technologies ETN play

Solactive has licensed its Solactive Whitney U.S. Critical Technologies Index to be used as the underlying of the new ETRACS Whitney US Critical Technologies ETN listed by UBS Investment Bank. The ETNs are traded on NYSE Arca.

The launch marks the first engagement of Solactive with J.H. Whitney Data Services to develop an index strategy. The index seeks to track companies that support critical emerging technologies across the US and its allies – index constituents are selected based on affiliation with the modernisation priorities and their geostrategic risk rating score.

‘The innovative and transformative nature of critical emerging technologies offers significant potential for growth and diversification, as it provides exposure to a broad range of companies in this sector,’ said Timo Pfeiffer (right), CMO of Solactive

The industry affiliation maps designated technology priorities to granular industry classifications, and the geostrategic risk rating score measures entanglement in risky countries, as designated by the US government. The result is a universe of companies aligned with the US modernisation priorities with minimised geopolitical risk from sanctions, trade, and conflict.

The Solactive GBS Developed Markets Large & Mid Cap USD Index forms the basis of the index universe, which consists of large and mid-cap companies in developed market countries. To be included in the index, companies must be associated with one of the 14 critical technology sectors and receive a high geostrategic risk rating score, as determined by the selection criteria.

‘The [new index] is a pioneering benchmark that uniquely factors in the emerging geopolitical landscape and the associated risks and opportunities for companies and investors alike,’ said John O’Connor, chairman & CEO at J.H. Whitney Investment Management.

Swiss specialist provider deploys post-trade processing of structured products

Independent Swiss providers of securities and investment services for structured products CAT Financial Products (CATFP) has transformed its front to back-office processing efficiency with a multi-asset post-trade processing solution offered by global fintech Broadridge Financial Solutions.

CATFP is seeking to leverage the Broadridge's cloud-based platform as it seeks to scale up its operational model that combines principal trading for securities, derivatives, FX and crypto markets, together with its issuance and agency brokerage service for actively managed certificates (AMCs).

‘We are strategically positioned to gain new momentum through the development of structured products, AMCs and exchange-traded products, all delivered through an enhanced and differentiated client service offering,’ said Stephan Giselbrecht, COO, CATFP.

Danny Green (above-right), head of international post-trade solutions, Broadridge, noted that CATFP will have ‘the strongest technology foundation at the heart of their business’ to drive efficiency through ‘the highest levels of straight-through processing and API-enabled services’.

‘[This will] reduce risk and provide the flexibility and capacity for future growth, while optimising cost/income ratios,’ said Green.