Banks continue the revolving door theme, while market activity gradually recovers from its Covid shock in some key jurisdictions.

BNP Paribas has announced the appointment of a new chief investment officer (CIO) for its private bank. Edmund Shing takes over the responsibilities of BNP Paribas Wealth Management’s CIO, Florent Bronès, who has resigned from his role with the group and will collaborate with a charitable organisation before he retires. He joined the French bank’s corporate and institutional banking division as global head of equity derivatives strategy in London at the end of 2015.

Two other French banks active in the structured products market have put forward staff headcount changes of their own.

Société Générale has announced ‘several organisational adjustment projects’ linked to the implementation of the restructuring announced at the beginning of August aimed at reducing the risk profile of the credit and equity structured products business. The headcount reduction exercise relates to ‘market activities and associated functions’ which seek to reduce costs by €450m by 2022-2023 and improve the profitability of the bank’s equity derivatives activities.

Natixis has decided to reorganise its equity derivatives trading operations in London following the announcement made two weeks ago when the French bank’s quarterly results were announced. SRP has confirmed that part of Natixis’ strategy to centralise the management of its global markets trading books in Paris, and the reorganisation of the London branch, will see around 30 roles moved to Paris and the remaining 20 will be eliminated.

One of the most high-profile news pieces in the past week has seen Modelity Technologies, part of the LPA group, launch Modelity Marketplace, a new click & trade platform which includes multi-dealer functionalities. The LPA group-owned Israeli fintech has spun off its click-and-trade platform to launch a new multi-issuer hub, while the regtech and other capabilities of Modelity Technologies will remain within LPA.

In the US, after two years of strong decline in sales volumes, the lingering long-term impact of the Covid crisis may turn out to be a good thing for market-linked certificates of deposit (MLCDs). Issuance and sales volumes of MLCDs in the US has dropped dramatically in 2020, the main driver being the interest rate environment though the other factor limiting the appeal of MLCDs has been an increased issuance of income-based products versus growth-based ones. Whereas five years ago 70% of all sales volumes in the US came from growth products, in 2020 to date, the ratio growth vs income is now 50:50, according to the SRP US database.

In our latest coverage of bank results, Intesa Sanpaolo has reported net income of €3.1 billion (US$3.6 billion) for the first nine months of 2020. It was the group’s second best nine-month net income since 2008, already exceeding the around €3 billion minimum net income target for FY2020. The Italian banking group’s net income during the first nine months of 2020 was its second highest in 12 years, although sales of its structured certificates were down 38% year-on-year.

Two of the main Japanese securities houses have registered an increase in issuance and sales of structured products year-on-year.

SBI Securities is enhancing its distribution of structured bonds, which has added up to JPY127.5 billion (US$1.22 billion) by self-origination and distribution from December 2015 to September 2020, according to the company’s interim report for the period ended 30 September. The Japanese securities house, which claims to have the largest retail investor base in the country, is the third most active distributor by issuance after MUFJ Morgan Stanley Securities and Tokai Tokyo Securities

Shinsei Bank, the bank led by Hideyuki Kudo, reported that assets under management (AUM) from retail banking product sales stood at JPY5.86 trillion as of 30 September - this includes structured bonds, structured deposits, mutual funds and insurance products. According to SRP data, Shinsei Bank is the fourth most active distributor with 55 notes issued year-to-date worth an estimated JPY124.3 billion and a market share of 5.57%. By sales, the bank is the third largest distributor with all products issued in-house after MUFJ Morgan Stanley Securities and Mizuho Bank.

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