News in the past week focused on slowing down activity, Chinese structured deposit rules, high-profile moves at ScGen, and renewed index uses.
It’s been an interesting week for Asia Pacific markets.
SRP reported last Tuesday that structured warrants and ETFs listed at the Singapore Exchange (SGX) experienced a decrease in traded value while daily leverage certificates (DLCs) gained some traction in September. The total traded value of structured warrants in September was down 13% to SG$296m (US$218m) compared with August, according to the SGX. A product issued by Macquarie Capital Securities (Singapore) had the highest trading volume of SG$508.1m, translating to a value of SG$38.1m – 12.9% of the total.
Ping An Bank, the subsidiary of Ping An Insurance Company of China, posted a net profit of CNY8.7 billion for the quarter ended on 30 September, up 6.1% year-on-year (YoY).
Net interest income and net fee and commission income saw an increase of 9.8% and 32.6% to CNY24.8 billion and CNY12.5 billion during the period from July to September respectively YoY. Meanwhile, investment income plunged to CNY278m from CNY2.8 billion YoY.
Opened for business on 28 August, Ping An Wealth Management is ‘steadily promoting the pressure reduction of stock principal-guaranteed wealth management products (WMPs) and old products’ while introducing more net-value based products that meet requirements of new asset regulations released in 2018. The balance of principal-guaranteed WMPs, which are in fact structured deposits, decreased by 67.6% to CNY21.8 billion from the end of 2019.
As at the end of June, the balance of structured deposits was down by 39.3% to CNY40.8 billion compared with the end of 2019 while non-principal guaranteed WMPs increased by 12.7% to CNY665.3 billion, SRP reported.
On the people moves side, Australian wealth platform Stropro has announced the appointment of David Zammit to its board of directors. He joins from Australian mortgage broking firm Mortgage Choice where he was general manager, distribution and wealth. Prior to that, Zammit spent more than eight years at Citi, where he worked at the bank’s mortgage and investments divisions.
Jaye Chiu, former head of investment management for Asia at BMO Private Bank, joined Bank of East Asia as head of investment products & advisory, as of 1 October. He joined the bank on 27 July, and reports to Jessica Ng, acting head of wealth management division, a BEA spokesperson at the Hong Kong-headquartered bank told SRP.
Over in Europe, Julien Lascar, head of global market sales - Europe ex-France, at Société Générale Corporate & Investment Banking (CIB) has been appointed global head of equities & equity derivatives sales for global markets. Lascar will remain in Paris and report to Alexandre Fleury, head of equities and equity derivatives and Yann Garnier, head of global market activities sales.
Swiss banking giant UBS delivered its best third quarter in a decade as market volatility leads to higher client activity in equity derivatives. It reported a profit before tax (PBT) of US$2.6 billion for the third quarter of 2020, up 92% YoY, and its investment bank registered a PBT of US$632m, up 268% from the prior year quarter.
Revenues for the global markets business increased 26% to US$ 1.6 billion, delivering the ‘best third quarter’ since the acceleration of UBS’s strategy in 2012, primarily driven by higher client activity levels.
Innovation-wise, SRP covered two noteworthy events. Mariana UFP and Lowes Structured Investment Centre have launched the 10:10 Income & Growth Plan, a new structure providing quarterly income payments and early maturity after three years. The new Mariana 10:10 Plan FTSE CSDI, which introduces for the first time the FTSE Custom 100 Synthetic 3.5% Fixed Dividend Index to UK retail investors, will pay 0.75% for each quarterly observation date that the FTSE CSDI is above 70% of its level on the strike date.
Goldman Sachs has rolled out a new series of tranche products linked to the oldest ESG index in the US – the MSCI KLD 400 Social Index. The new structures - four of which struck on the last week of September and five have their initial valuation at the end of October - offer exposure to the MSCI underlying via two- and five-year structures combining capped call, enhanced tracker, protected tracker and worst of payoff types.
Three of the structures are available exclusively on the Simon Markets platform and three are being sold by Axio Financial. The three offered by Incapital have been cancelled.
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