Bank Millennium was voted Best Distributor Poland at this year's SRP Europe awards.
SRP considered 11 products from the bank worth an estimated PLN2.1billion (US$525m) with strike dates between 1 October 2022 and 30 September 2023.
In full year 2023, the bank distributed 10 structured deposits with estimated sales of PLN1.3 billion. Most featured the shark fin payoff, and they were mainly linked to single equity indices, ETFs, or equities.
It is very important to us that our products generate the highest possible profit for our clients - Marcin Serafin
Last year was demanding in terms of structured products due to the rapid changes in the financial markets, although high interest rates and market events allowed Millennium to create attractive products, according to Marcin Serafin (pictured), director treasury department at Bank Millennium.
“We were able to offer investments at attractive levels […] clients saw this opportunity and sales were high,” said Serafin.
Towards the end of the year, the bank started to focus on constructing products linked to tech companies such as Amazon (Globalny Market III), Alphabet (Internetowy Gigant I), and Advanced Micro Devices (Gigant Technologii I).
“We believe that in times were technology is developing so dynamically, these products have great potential and give the client a chance to earn a large profit,” said Serafin.
Globalny Market III offers an overall minimum return of 105.1% while the guaranteed coupon for Internetowy Gigant I and Gigant Technologii is 4.2% over a two-year period. In addition, all three products provide 60% participation in the upside performance of the underlying share providing it has not closed at or above 150% its starting level at any time during the investment period. The potential maximum return in that case is 129.99%.
Since August 2023, all of Millennium’s products have been linked to single stocks with the exception of Potencjał Japonii IV, which was linked to the Nikkei 225
“In recent months, we have noticed that single stock-linked products are offering more favorable conditions for clients.
“It is very important to us that our products generate the highest possible profit for our clients,” said Serafin, who emphasized the importance of the products on offer being easy to understand for the bank’s clients.
“At the time of purchasing our products, clients should not only the understand the terms and conditions, but they should also be able to assess the profit potential on their own.
“In this respect, products based on shares of leading global companies that are widely recognised are a better choice than indices and ETFs because clients know exactly in which product they are investing,” said Serafin.
Most of Millennium’s products in recent times have been knockout calls with a guaranteed coupon, which the bank started to issue in response to situation on the financial markets and were made possible by the high interest rates.
“These products were very popular among client because they could purchase an investment product that offers guaranteed interest, sometimes comparable to an ordinary bank deposit but gives the opportunity to obtain additional interest at a very high level with a 100% capital guarantee on the maturity date,” he said.
Serafin refused to be drawn on predicting the main investment themes for Polish investors in 2024, as there are too many variables to clearly determine investor preferences.
“This is related, among others, to the changing financial environment, market situation as well as the investor's specificity,” he said.
“We will try to take advantage of emerging opportunities on the financial markets. There are so many unknowns that we don't have any concrete plans and we will act depending on the current situation,” Serafin concluded.
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