This week marks the 10th anniversary of the Deutsches Derivate Verband, a trade association that represents the interests of the structured products industry in Germany. SRP talks to Lars Brandau (pictured) about the creation, achievements of the association, and its plans for the next decade.

How did the DDV start and what were the decisive factors in the merger of the two predecessor associations?
Brandau: The German Derivatives Association (DDV) was created in 2008 from the merger of the two previous interest groups, the Derivate Forum eV and Deutsches Derivate Institut (DDI). Based in the financial centre of Frankfurt and the political centre of Berlin, it has been our declared goal from the outset to make market structures and products more transparent for private investors in order to form the basis for the success and distribution of this young asset class. After the momentum built up in the years up to 2008, the aim was to make the industry more efficient by bundling resources into one powerful association.  

What have been the most important projects of the past 10 years? 
Brandau: A look at the overall environment during the start-up period reveals that it was not easy in the first few years. The financial crisis was already on its way and changed public perception of the financial sector. Due to the Lehman Brothers collapse, we were challenged from the beginning and had to assert ourselves at times against strong resistance. To this day, our commitment to more clarification and transparency of structured securities has continued. This includes, for example, the compilation of monthly statistics (stock exchange turnover, market volume, issuers' market shares) in order to document market trends. Here we were pioneers in the European environment. The self-regulation of the members (Fairness Code) is certainly one of the major projects. The whole thing was of course accompanied by numerous information and further education initiatives, such as the current DDV on Tour. In this context, it is necessary to mention that the DDV has been rewarded several times for its commitment to more transparency and education at national and European level.  

How has it been possible to transform competitors into a powerful association in a highly competitive market?
Brandau: This can only be achieved if the strengths are sensibly combined and the added value of an association is visible and perceptible to all members. This requires intensive debate and consultation in order to dispel any reservations and fears. Only in this way will it be possible to keep an eye on the overarching goals and to drive forward joint efforts. Ultimately, what counts is the impact and perception of others in order to make a sustainable impact on the market. The particular interests of individual issuers must occasionally be put in the back seat of a sustainable consensus for all.     

What role does the DDV play in national and European legislative initiatives?
Brandau: The DDV takes an important role in the regulatory discourse. The regular, close exchange with supervisory authorities at national and European level ensures better mutual understanding. In the future, our attention and efforts will be directed more to ensuring that legislative initiatives do not lead to counterproductive over-regulation and thus to more confusion than improved investor protection. 

What is the plan for the next 10 years? 
Brandau: As an association, we have achieved a great deal over the past decade. However, this should not hide the fact that there are still major challenges to be overcome. There is no sign of an end to regulation, so we will continue to play an active and intensified role. This also applies to our transparency, investor protection and knowledge transfer efforts. It is simply frustrating that even in times of low interest rates, comparatively few retail investors in Germany are actively involved in asset accumulation and retirement provision. At this point, we cannot get tired of underlining the added value and the sense of structured products in the broad portfolio approach. Currently, our DDV on Tour - event series is running with proven experts and great success. Complex contents communicated in an understandable way - that is the approach we will certainly continue to pursue.   

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