This week continued on a gloomy trend initiated in previous weeks when it comes to banks’ and other financial institutions’ earning reports.

BNP Paribas’ was the latest bank whose revenues from structured products took a hit in Q1 2020 – it blamed ‘extreme and exceptional’ volatility in the financial markets at the end of March. It reported revenues of €10.9 billion in the first quarter of 2020, a 2.3% decrease from the same quarter last year. Corporate and institutional banking (CIB) revenues were down 1.9% after the business recorded a ‘severe’ one-off impact of €-184m in Q1 2020 on equity and prime services’ revenues within global markets, which houses the bank’s structured products business.

Barclays fared no better, with net profits sliding by 35% from the first quarter of 2019 to £842 million. However, it reported a 20% increase in revenue from Q1 19 boasting figures of £6.28 billion on the back of higher issuance and sales volumes.

Natixis said that in spite of ‘strong’ results for fixed income, investment banking and M&A, other businesses, including financing and equity derivatives, ‘were impacted negatively’ by the Covid crisis. It reported net revenues in Q1 2020 were down 11% from the prior year quarter.

Turning our attention to the Nordics, Danske, Handelsbanken, Nordea, SEB and Swedbank lost a combined 40% market share in Sweden compared to Q1 of 2019. Some 133 structured products worth SEK2 billion (€188m) had strike dates in the first quarter of 2020 in Sweden, a 30% decrease from last year’s same quarter. Back then, the market was dominated by local and regional issuers, with SEB, Nordea, Swedbank and Handelsbanken making up the top four with a combined 62% share. The combined market share of the aforementioned banks has shrunk to 26%, with only (part Swedish) Nordea retaining its place in the top three.

Two high-profile senior executive moves have hit the headlines this past week. Société & Générale has hired HSBC’s former global head of sales for equities electronic trading in Hong Kong, Jonathan Green as head of electronic coverage in Asia Pacific for equities and equity derivatives within the global markets division, overseeing the new electronic coverage team in Hong Kong. Former structured products stalwart Philippe El-Asmar will lead ETF distribution for Asia-Pacific at JP Morgan Asset Management. El-Asmar, was appointed head of Asia beta strategies in Hong Kong in 2018 reporting to Michael Camacho, global head of beta strategies. El-Asmar , a veteran of the industry, worked in equity derivatives and structured products and was finally global head of equities distribution and head of distribution of Asia Pacific at Barclays in Hong Kong and, before that, global head of investor solutions at Barclays in New York.

On a more positive note, Deryk Rhodes, managing director and head of market-linked products trading and origination at Incapital, told SRP he continues to be very optimistic on the growth of the market despite the current uncertainty.

“These products have now survived a number of different market cycles and have adapted with the market and continue to bring value that cannot be easily duplicated elsewhere,” he said. “The industry is also a little bit more mature than it was even five years ago.”

In Singapore, Rohit Jaisingh, head of capital markets products, DBS Private Bank (Singapore), saw an opportunity to leverage current market conditions and support investor confidence by offering structured products with a look-back option, which enabled clients to access an entry point or strike level at the lowest level of the underlying over the first month of the transaction.