The past week saw ESG and technological innovations grab the headlines
The ESG thematic continues to gain ground in the global structured product space.
French asset manager Amundi said in a recent earnings announcement that assets under management that include environmental, social and governance (ESG) criteria reached €314 billion, a seven percent increase year-on-year. A partnership with Spain’s Banco Sabadell and the €430m acquisition of Sabadell Asset Management, announced in January 2020, are part of this focus.
A number of senior appointments in the ESG space at key investment banks have also confirmed how sustainability is grabbing global headlines. Deutsche Bank has appointed Kamran Khan to the newly-created role of head of ESG for Asia Pacific. He will be responsible for developing and coordinating the regional business strategy around ESG across all of the bank’s business divisions in the region. HSBC Global Asset Management has hired Michael Ridley as senior responsible investment specialist as the group sets its sights on impact investing products. He joins from HSBC’s global banking and markets business where he was global head of ESG fixed income research. Morgan Stanley Investment Management has made two senior appointments to its sustainability strategies in London and New York - Emily Chew has joined MSIM’s New York office as global head of sustainability to lead the investment business’ sustainability strategy and governance efforts, and Navindu Katugampola has recently joined MSIM’s London office as the global head of sustainability for fixed income.
New themes in the structured product space also reveal how innovation is having a key impact.
Last week, SRP caught up with Shane Edwards, former managing director and global head of equity derivatives at UBS Investment Bank, who joined digital asset financial services and advisory company Diginex as head of investment products in January. In this interview, he discussed how the crossover between structured products and crypto will increase over time.
“In addition to collaborating on overall strategy, my specific aim is to design and deliver investment products to clients who are used to trading stocks, bonds, ETFs and structured products, as well as to help architect the foundations of a scalable derivatives marketplace,” he told SRP.
There is already evidence and proof of concept around the use of structured products to facilitate access to new underlying assets including cryptocurrencies. Edwards believes there is scope to increase the visibility of crypto assets in the structured products market once issues around fragmentation and regulation are overcome.
Over in Australia, investment platform Stropro has launched a new reporting functionality: the fintech is offering all Australian owners of structured products the option to have greater visibility of their investments, including daily price movements. Ben Streater, chief product officer at Stropro, said the technology, which is supported by US tech giant Microsoft, enables daily active tracking of underlying assets with price feeds from stock exchanges around the world.
Spain’s BBVA and fintech provider FinIQ have collaborated to launch BBVA ePricer, a cloud-based web solution for the bank’s equities and credit-linked structured products.
FinIQ CEO Mahesh Bulchandani, said the current coronavirus emergency has put technology at the forefront of the industry. “The reality is that technology is needed for this market to grow and move forward in the short term,” he said. “People want connectivity, access and not just a front-office but the whole front-to-back facility. We think there is scope for us to develop new tools for the industry and help market players to adapt to the new reality.”