Despite an overall drop in the sales volume this year in the European region compared to a year ago, the top 20 issuers managed to keep the pace in 2018.
A total of over €79 billion worth of structured products were sold in the 11 months to November 30, 2018, SRP data shows. This compares with €85 billion for the same period in 2017, and €96 billion for 2016.
The sales volume of the top 20 issuing groups, however, rose in 2018 from the previous year as of the end of November, with some seeing sales increasing nearly two-fold from 2015.
Looking at the top five, Vontobel is the clear winner in the public offering segment. The Swiss financial giant has seen selling volumes increasing by 17% year-on-year to €14.57 billion, claiming the top spot and taking a margin of more than 100% with the runnerup. Vontobel continues its dominance in the market by an average margin of 17% in the past four years.
The Swiss bank reported an increase in its market share in the first three quarters, and expanded into new segments with the launch of a new pension investments digital platform, which offers relationship managers as well as external managers with a cost-efficient source to provide pension solutions to their clients.
The bank predicted in its half-year results that the second half of the year would be comparatively difficult and require a 'careful approach'.
‘Our growth in 2018 confirms that clients are satisfied with the breadth and quality of services Vontobel provides. We are aware that our success depends heavily on the markets,’ said Vontobel CEO Zeno Staub. ‘The political backdrop in particular is increasingly unsettling the business world and ultimately our clients. Nevertheless, we are maintaining our targets in terms of solid, long-term growth.’
Coming in at the second in the issuer rankings is Landesbank BW, which has seen this year’s sales volume total at €7.01 billion. The figure marks an 81% increase from a year ago and an impressive 160% hike from 2015. Although lagging by over two times behind Vontobel, Landesbank is also around 24% ahead of the third-placed group – BNP Paribas.
BNP Paribas takes the third spot with a total sales volume of €5.65 billion in 2018, down 9% YoY and is around 25% ahead of fourth-placed – Societe Generale, in terms of market share.
‘BNP Paribas delivered this [third] quarter a good level of income, at €2.1 billion,’ said Jean-Laurent Bonnafé, CEO of BNP Paribas, commenting on the results. ‘Despite a still unfavourable market context in Europe, the revenues of the operating divisions increased slightly, driven by the specialised businesses.’
Societe Generale takes the fourth place this year with a total sales volume of €4.52 billion. SRP data shows, however, a downward trend in the past four years. The volume dropped 11% on an annual basis and was also 15% lower compared with the same period in 2015.
The vast majority of products were listed certificates targeted at retail investors in Austria and Germany. In France the bank predominately wrapped the structured products as life insurance contracts – which were distributed via Adequity, DS Investment Solutions, Equitim, Gresham Banque, Irbis Finance and Vaillance Courtage, among others. In the UK, the products were available via Investec, Meteor, Tempo and Walker Crips, while the products in Sweden were distributed via Exceed and SIP Nordic. Societe Generale was also active in Belgium, Italy, Ireland and the Netherlands.
‘Societe Generale published solid results in 3Q18, with a good level of profitability,’ said Fréderic Oudéa, the group’s CEO, commenting on the results. ‘The Group pursued its disciplined approach to cost management and the low cost of risk confirms the quality of our loan portfolio.’
Credit Agricole's asset manaegement arm, Amundi, posted sales of €4.38 billion in Europe this year, 4% lower on an annual basis, but up 10% from 2015. The French asset manager sold just 40 products for 2018, mainly linked to the Eurostoxx 50.
'2018 pursued the same commercial momentum as 2017, so that 2018 is our best year since the 2008 financial crisis,’ said Mouha Ait El Ghachi, deputy head of structuring for France and head of structuring for France retail at Amundi Asset Management.
“ This is due to two effects. First, our efforts alongside with our partner networks to implement early in 2018 the new regulations created the conditions of success. Then, the commercial dynamics of our distributors has been supported by the good performances: multiple products – whether autocalls or bullet products launched 5 or 6 years ago – have been refunded with attractive performances (annual return from 5.30% to 7%) and encouraged clients to reinvest.”
The main item in the agenda for 2018 was the implementation of the Mifid 2 and Priips regulations which have put pressure on the issuers and even caused a slowdown in several European markets.
“As we feared a negative short-term impact on volumes due to Mifid 2 and Priips, we spent a lot of time and energy in 2018 managing that transition and working alongside with our partners to have a smooth implementation,” said Ait El Ghachi. It was such a success that figures exceeded our expectations and we are very happy about that. But, it may have slowed down our development in new markets or new clients.”
Outside of the top five, there were significant movements as shown by SRP data. More than a 100 different issuers were active in 2018 transacting a volume of around €163 billion.
Among all issuers in 2018, Bank Pekao, ING Bank and Banco Santander Totta saw the highest relative year on year growth at more than 200% each. At the other end of the spectrum, three Spanish banks - KutxaBank, Banco Sabadell and Banco Popular, saw their sales volumes dropping by around 70% on an annual basis.