SRP Europe 2020: Awards Report

SRP Europe Awards Report 2020

SRP Europe Awards Report 2020

Editorial: Amélie Labbé, Pablo Conde and Marc Wolterink

Data: Velina Bulanova, Nikolay Nikolov and Gabriela Petrova

If you are interested in having a similar bespoke report produced for your organisation, please contact Reihaneh Fakhari at +44 (0)20 7779 8220 or email reihaneh@structuredretailproducts.com

1.1 Introduction

Structured Retail Products (SRP), part of the Euromoney group of companies, is a news, data and research company based in London, Hong Kong, Sofia and New York, providing research and training services related to all aspects of structured products.

Founded in 2001, SRP’s clients include all the major global financial services groups, financial regulators, stock exchanges, index providers and professional services companies.

SRP also owns and maintains the specialist industry website StructuredRetailProducts.com. The site was launched in January 2003, and has become the leading online information resource for the global retail structured products industry. With nearly 5,500 registered users and more than 25 million product listings (as of January 2020), the website is the primary information source for a wide range of businesses involved in the manufacture and distribution of structured investment products globally.

Copyright information

This report is copyright © 2020 Structured Retail Products Limited. All rights reserved. Reproduction

and distribution of this report in any form without prior written permission is strictly prohibited.

Furthermore

• It may not be sold for commercial gain, either in part or in its entirety.

• It may not be photocopied or printed for multiple use, with the exception of within the organisation for which it was purchased.

• It may not be distributed electronically or otherwise in a manner other than that described above.

Indemnity

The information contained herein has been obtained from sources believed to be reliable. SRP disclaims all warranties as to the accuracy, completeness or adequacy of such information. Use of this report is at your sole risk and SRP accepts no responsibility for any problems or incidents arising from its use.

Acknowledgements

This report would not have been possible without the support of the structured products industry across Europe, the Middle East and Africa which participated in the survey during September 2019, and whose data underpins this report.

1.2 Scope

This report covers the manufacture and distribution of structured products in all forms –including wrappers such as funds, notes, bonds, certificates, deposits and life assurance – and usually linked to equities, foreign exchange, commodities, credit and interest rate underlyings.

It presents information on structured retail products markets across the Europe, Middle East and Africa (Emea) region.

For the purposes of this report, a structured product is an investment product which provides a predefined return linked to the price of one or more underlying assets. These are usually financial asset prices, rates or indices but, in rare cases, can be the outcome of sporting or other events.

The product can usually be broken down into a number of separate financial instruments, one of which is usually a derivative product.

Where a derivative is not used, the product will use a derivatives-based investment strategy or computation to provide the return.

Although we exclude simple warrants, listed options and futures, and delta one products, such as tracker funds, exchange-traded funds and notes, reference to these products may be made where relevant.

The report is based on a quantitative and qualitative analysis. SRP surveyed 759 structured products distributors across the Emea region in September 2019, collecting data on structured product manufacturers from the point of view of their distributor clients. The results from the survey form the basis of this report. Details of the quantitative and qualitative analyses are available in the Methodology section of the report.

The report provides the following information:

1. scope, methodology and management summary of the report’s main findings;

2. analysis of the structured product market in the Emea region based on survey responses;

3. separate analysis of the manufacturers by asset class; and

4. analysis of top distributors’ awards.

1.3 Methodology

Description of the survey

In September 2019, SRP surveyed Emea structured product distributors, receiving 759 responses. The survey was composed of three areas of investigation:

Part 1 - Quantitative

We asked respondents to the survey to specify up to three investment banks that they use for hedging purposes for each asset class in which they operate, and to specify the volume of business for that asset class and the percentage split by bank.

Part 2 - Qualitative

The respondents were then asked to rank the investment banks they dealt with for each asset class as 1, 2 or 3 (where 1 = below average, 2 = average and 3 = above average), according to three main service categories:

• price competitiveness;

• understanding client needs and aftersales support; and

• innovation and structuring capability.

Part 3 - Data validation

Captive votes and those representing internal

transaction flows were excluded from the results. This includes votes cast by distributors that are part of banking groups that use their parent group for 100% of their activity and internal structuring desks. In addition, votes were not included in the survey where:

• Providers voted for themselves.

• SRP could not confirm the identity of the respondent.

• A respondent voted more than once and SRP could not resolve the duplication.

The survey results underpinned the 2020 European Structured Product Awards, which were handed out on January 28 2020 during the 17th Annual Europe Structured Products & Derivatives Conference in London.

For the purpose of this report, the scores for each main service category for the individual banks are calculated by averaging. Service scores are, therefore, suggestive of the level of service that a client might expect to receive when working with an investment banking counterparty.

2.1 Management summary: The pressure is on

What a year 2019 was – a bit like a pressure cooker that is slowly and regularly reaching boiling point but not getting there quite yet.

Ingredients keep being added that pile on pressure. According to respondents to SRP’s Europe Awards Survey 2020*, these include: a challenging environment which is having an impact on product payoff profiles; changing responses to market volatility and its knock on effect on yields; compressed margins; a long period of unchanged rates, and; the need to find new product structures that promise good returns amid challenging funding conditions.

The list above is by no means exhaustive. There are many more factors that came into the market mix last year. It’s also not a new list, as many of these phenomena have been around for a while and are expected to continue into 2020 and beyond.

This complex situation has had some impact on the overall performance of structured product providers when it comes to price competitiveness, as well as innovation and structuring capabilities. But looking at the most recent figures, the score barely changed in 2019 compared to the previous year. While the price competitiveness ratio decreased slightly, the innovation and structuring capability criteria remained at the same level. Both significantly and unsurprisingly, what stood out was the understanding of client needs element, whose score rose to 2.58 (2018: 2.48): this is significant because it means the industry is adapting to changing client

needs and ambient volatility, and it’s unsurprising for the same reason.

The shape of (equity) things to come I wish I could say that responses to the survey were overwhelmingly positive and constructive when it comes to challenges specific to equitylinked structured products. Certainly, the need to improve connectivity, ESG, thematic indices, product innovation and digitalisation/automation featured regularly in respondents’ comments. On this last aspect, one respondent articulated a very real situation that will be shaping the industry for years to come. “Increasing automation is driving competition up, as well as increasing [the presence of independent asset managers] and private banks,” he said.

Platforms have already started making their mark in the structured product space, and the expectation is that “more products will price on platforms” and that automation will take over large parts of the market, namely the flow business. Coupled with retail investors asking for more product tailoring and speedier response times, this creates a perfect storm in which platforms can thrive.

But the current market outlook is still very much the key concern for a majority of respondents in this space, including declining rates on fixed income and a “possible significant stock price correction that could push some of older products’ underlyings below the barriers resulting in capital losses from clients”.

“Global rates going down might push appetite for yield-enhancing structures [but] relatively low funding rates might adversely impact pricing. Uncertainty could favour non-directional volatility plays,” commented one survey participant based in the Middle East.

“Some issuers have totally disappeared from the market. Trading losses have played a part in this,” said another from France, while another still highlighted (in German) the need to “structure the right shares at the right time [amid] high volatility”.

Please call again

Autocalls have been the structured product investment of choice for issuers and investors alike for many years. Recent uncertainty may not have shaken confidence in this product but some small cracks are starting to appear.

As one survey participant said, one challenge in the current environment is delivering attractive product performance and high capital protection barriers. “It should still be the most popular structure in the equity space,” said one respondent from Finland, conceding that the deterioration of the pricing environment has posed challenges for headline coupons.

One comment that has come back time and time again in surveys is the lack of autocallable alternatives. Linked to this is the host of challenges that arise from the European industry’s dependency on this payoff type including capital protection in a low interest rate environment and “[trading] lower autocall triggers to maximise autocall events in case of sideways or bearish markets”.

How low can they go?

When it comes to interest rates, it’s anyone guess as to if and when they will go any lower than they already are – and they have entered negative territory in some markets. This was the main concern that respondents outlined in last year’s survey, and it continued to resonate this year too.

One respondent summarised the situation perfectly. “Low [interest] rates will not provide an easy pricing environment, both in terms of liability and on the asset side,” he explained. In this respect, innovation will play a key part not only in keeping products performing, attractive and relevant – and credit spreads tight - but also in keeping clients engaged.

Another respondent, from France, specifically

highlighted the knock-on effect of negative euro interest rates on products (maturities are significantly longer) while several European fund managers articulated the challenge was finding issuers that are still paying a coupon and income generating payoffs.

Interestingly, the transition away from Libor to new risk-free rates was mentioned only on a couple occasions, in spite of the expected headache that the shift is expected to give many market participants.

ESG sweet spot

The European structured product industry’s fondness for the ESG thematic is well documented. But obstacles are still in the way to it becoming even more mainstream. Respondents to SRP’s latest Europe survey have outlined standardisation, education, underlying diversification and pricing challenges, to name a few.

Transparency is an important theme. “Transparency when it comes to licensing costs associated with ESG indices,” requested one asset manager, while a respondent from a French bank outlined the need for stricter criteria and more detailed explanations supporting decisions to include/exclude stocks as underlyings.

All and all

Something that we see in surveys every year –and that SRP is constantly fighting for – is the acknowledgement of structured products as an asset class in its own right, with their own place in an investment portfolio.

One UK respondent offered a glimmer of hope that will also be our final note.

“[There is] increasing recognition of the merits, value and proven efficacy of structured products to add value in diversified and balanced portfolios, particularly in a low returns environment, in which alpha by fund management is increasingly understood to be difficult to identify (in advance)… Alpha, which structured products offer, has a proven place within portfolios alongside active and passive fund options,” said the respondent.

According to this respondent, there will also be “increasing focus on the importance of operational strength and integrity for providers and a flight to/race to the top for quality, of process, support and service, as opposed to a race to the bottom on charges, which is the wrong race for the industry to have”.

2.2 Issuance and volumes between 2016-2019

3.0 Trends & predictions

What will the most popular payoffs in your market be over the next 12 months, and why?

It’s expected there will be a slight drop in the number of autocallables in the next year, with the autocall payoff structure ranked number one among future payoffs, according to 59% of respondents that took part in the SRP European 2020 Awards Survey (15% in the 2019 results). The payoff structure continues to be the most traded in the DACH region as well as in France and Italy. This type of payoff is usually combined with the reverse convertible, which came in second with eight percent of votes, and the worst of option which was chosen only by three percent of participants as a favourite payoff. In last year’s results, the latter was in second

place with 16% of votes. Last year’s winner –the callable payoff - has dropped dramatically from 34% to only two percent for 2019. It is traditionally preferred by Swiss, Belgian and German investors.

The protected tracker structure which is also quite popular in the DACH region, came in third place, with seven percent of votes, registering a one percent growth compared to last year’s results. The popularity of the digital and accrual payoffs decreased – six and four percent, respectively –but these continued to be among the preferred ones according to survey participants.

Which of the following investment themes will be the most prominent over the next 12 months?

Environmental, social and governance (ESG) was voted the favourite investment theme with 29% of votes (compared to 16% in last year’s survey). ESG indices have become quite attractive across Europe, primarily in France, Belgium and Germany throughout 2019. Clients are already pushing for ESG to play a growing part in more underlyings.

The leader of the previous year’s results - Equity - Developed Markets - takes second place with 23% of votes, followed by Credit (13%) and Equity - Emerging Markets (10%). Proprietary/ Custom indices, which are favoured by the German, Belgian and Austrian markets, saw a slight increase in votes from three to five percent compared to last year’s results.

4.0 Manufacturer awards

Manufacturer awards are calculated on the basis of two factors:

• annual sales as in SRP’s database in the year to the end of August 2019 with a 50% weighting; and

• survey score with a 50% weighting. The survey score is based on the average rating across various criteria given to each contender by the survey respondents.

Best House, Europe

Best House, Equity

Best Institutional House

Best House, Interest Rates

Best House, Autocalls

Best House, ESG

Market share by volume

Survey Average Score

5.0 Distributor awards

The award for Best Distributor is based on the sales and performance data per product distributed by the buyside between September 1 2018 and August 31 2019. The strike date is relevant for best sales and the maturity date is relevant for best performance. Both results are amalgamated to go towards the best distributor awards. Sales volume is the total actual sales invested rather than the notional amount, and performance is the annualised return an investor would have received with a buy-and-hold approach from the strike date until maturity for a product. Each product’s performance will be weighted according to its sales volume to give a weighted average performance of the distributor’s portfolio of maturing products for the period.

Best Distributor Europe

5 distributors by sales (US$bn)

5 distributors by weighted-average performance (%)

Top

Top

Best Distributor France

Top 5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

Best Distributor Germany & Austria

5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

Top

Best Distributor Benelux

Top 5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

Best Distributor Eastern Europe

Top 5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

Best Distributor Nordics

Top

Best Distributor Capital-Protected

Top 5 distributors by weighted-average performance (%)

Top 5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

Best Distributor Yield Enhancement

Top 5 distributors by sales (US$bn)

Best Distributor Switzerland

Sales volume & issuance Outstanding - product issuance & sales volume Outstanding - product issuance & sales volume

Top 5 distributors by sales (US$bn)

Sales volume & issuance

Top 5 distributors by weighted-average performance (%)

Top 5 distributors by weighted-average performance (%)

Best Distributor Italy

Top 5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

Best Distributor Middle East And Africa

Top 5 distributors by sales (US$bn)

Top 5 distributors by weighted-average performance (%)

SRP Europe awards 2020 personality of the year: Samy Beji

SRP caught up with this year’s winner, Crédit Agricole CIB’s former head of structuring, about his structured product legacy, and the challenges and opportunities that lie ahead for the industry

1. How did you get into the structured product space?

As we say in France, I fell into the magic potion when I was fresh out of school. As a graduate, I had the choice between FX options trading and credit structuring. I had a module at university on the latter. It was still early days for this line of business but something was telling me it was a new, exciting market that was being developed so I chose to go in that direction.

I was initially hired as a structurer, spent six months in Paris at Crédit Agricole Indosuez, moved to London for four years and then to Hong Kong for five, to head up a small structuring desk. I ended up in mid-2006 as head of structured credit markets Asia with responsibility on sales, trading and structuring at Crédit Agricole CIB [CACIB].

It all happened very quickly. Some would say I have been very lucky but I guess you have to make your own luck.

2. What is the event that you believe has had the most significant impact on the European structured product industry?

It is a combination of things.

The low interest rate environment has boosted structured products insofar as they have become more mainstream. For instance, they are naturally and completely part of the private bank offering, and it is common to

have them included in large retail campaigns in Europe, including in France.

Regulatory scrutiny, from Priips to Mifid 2, on the back of the financial crisis, is another. The process of selling a structured product has become more tedious, for sure, but the changes were necessary. Priips is a sound piece of regulation: the obligation for manufacturers to produce harmonised marketing documents with precise information and risk scenarios is a great step for the industry. Now, when it comes to the implementation of Priips in the fine print, it is another story entirely.

3. What challenges does the industry currently face?

Standardisation is a key one. This goes hand in hand with transparency.

This business has not yet managed to reach the point where everything from product taxonomy to data, and product models and descriptions is homogenised across banks. There have been a few attempts to create market standards but, as an industry, we have failed to have a homogenous way to describe, confirm and trade a product. This has had the impact of slowing down market development.

In addition, I believe that this standardisation will ultimately help with digitalisation. Some platforms have tried to create click-and-trade in an equity-like world for structured products, but I am not sure it has had the success one would have expected.

Another challenge is the broadening of the market to include more tailor-made products. Overall, short volatility products such as reverse convertibles and autocalls still dominate the market. We have not been able to diversify in a significant manner into more special situation types of products that clients

can use to take a position on inflation, housing prices, commodities or FX.

4. What would you say has been the highlight of your career?

One of the key highlights for me was when it came to managing the structured credit legacy businesses in the aftermath of the financial crisis. Once the crisis unfolded, CACIB took the approach early on to discontinue certain activities, making them legacy businesses and in some cases, selling them off. This happened with structured credit. I came back to London to manage this legacy – it was a challenging exercise. The sale of our correlation books to a US hedge fund was the most complex transaction I have ever been involved in and was one I shared with very talented people internally.

This situation taught me a lot that I needed to know when we were tasked with rebuilding the structured products business here at CACIB. We were able to leverage on the experience gained through the legacy management.

The first step was regaining the trust of our clients, shareholders and stakeholders. There are some principles close to my heart that I apply consistently. Firstly, clients need to be at the heart of your product development philosophy. Secondly, it is important to diversify across asset classes to avoid dependency and excessive leverage. Finally, price is only one aspect of a structured trade – non-trade aspects like marketing, legal and compliance, client compliance and secondary markets, to name a few others, are equally as important.

Rebuilding a genuine cross-asset structuring team and seeing it contributing actively to the build-up of the structured product and solution business is a great satisfaction to me. CACIB has been recognised across the

industry as an innovative institution as shown by the various awards received over the years thanks to our client feedback. Repacks, Green structured bonds, CMS10yr10Yr are only a few examples of new ideas, business and payoffs that we have been able to develop collectively and which received positive feedback.

5. You have recently changed roles [Samy became global head repo & secured funding at CACIB in November 2019]. What are your plans now in terms of career?

Having been in the structured product business for over 20 years, I have tried to broaden my areas of interest. Relatively early on, some things stood out to me: regulation, digitalisation and managing company culture to name a few. The ESG thematic is also close to my heart. Credit Agricole CACIB is a leading player in this space and I was very involved in developing an ESG product range both on fixed income and equities.

But it became clear that I needed a new challenge and an opportunity came up in repo and secured funding. It is not a natural step if you look at it from the outside though the area has some similarities with things I have done in structured products. The product is not necessarily complex but the way it is traded and the development of the nonflow business are. It is that complexity, the IT challenges and the culture that drove me to change roles.

I am pleased with this move: I switched from structuring to managing a trading desk and a business unit. I think it sends a good message: there is a life after structuring…

Spotlight on: best-performing products of 2019 in Europe

SRP looked at last year’s best-performing structures in Europe to see how the different providers sought to extract value from an eventful financial services sector. Volatility as well as short-term geopolitical developments triggered bull and bear market moves but structured products continued to deliver above market returns.

Italy

Bonus Cap Certificate - Juventus Football Club - 21/06/2019

Betting on ‘Juve’ - Italy’s most successful football team ever - is always a safe bet for gamblers but investors on this certificate sold by UniCredit Bank at the end of 2018 hit the jackpot as it yielded an annualised performance of 50.83% at maturity in June 2019.

This growth product linked to the performance of Juventus Football Club promised to pay 130% capital return at maturity if during the life of the product, the level of the underlying stayed above 70% of its initial level. Otherwise, at maturity the product would have paid a 1:1 participation in the performance of the underlying, capped at 130%.

This capped call/reverse convertible structure delivered one of the highest returns of 2019 despite a number of products linked to the Juventus share being hit after the stock market value of the Turin club fell by almost 30% in late April following a high-profile loss against Ajax Amsterdam.

Germany

Multi Barrier Reverse Convertible Zertifikat auf ALVG.DE,

GASI.MI, MUVGn

Although Vontobel was behind the three bestperforming products in the German market in 2019, we have selected Goldman Sach’s Multi Barrier Reverse Convertible certificate linked to the Allianz, Generali, and Munich Re shares

because of its focus on European insurance companies.

This multi barrier reverse convertible sold by Goldman matured at the end of May 2019 delivering a 127.20% capital return on the back of an annualised performance of 12.65%. This growth structure offered a predetermined fixed coupon of 13.6% plus 100% capital back at maturity if during the investment term none of the underlying shares were at or below a predetermined barrier of 70% of the strike.

Belgium

SG Issuer (LU) Finvex Booster Note

In Belgium, retail investors got further proof that sustainable and ESG investments are delivering value and generating returns. Investors on Société Générale’s Finvex Booster Note racked up a hefty 186% capital return in mid-June after the product delivered an estimated annualised performance of 13.15% after five years of investment.

The capital-at-risk growth enhanced tracker play linked to the performance of the Finvex Sustainable & Efficient Europe 30 offered a participation of 325% in the positive performance of the index plus full capital protection if the final level of the index was at or above the initial level at maturity. Otherwise, the product would have paid 100% capital return diminished with 100% of the index fall.

Spain

BNP Paribas – Flexible Phoenix

Spain’s Bankinter dominated the ranking with the best-performing products of 2019 in Spain with structures linked to Twitter, Santander or Iberdrola but it was provider BNP Paribas who delivered the second best return of the year with a one-year play linked to its main competitor outfit - Société Générale.

This reverse convertible/knockout structure

promised to mature early after three months paying a 3.30% coupon per period elapsed if the underlying share was above its strike level on each three-monthly observation date. At maturity, the product would have paid a 103.30% return if the 70% protection barrier had not been breached. If the barrier had been breached the initial investment would diminished one to one with fall of the share.

Sweden

Garantum Fondkommission - Autocall Svenska bolag Combo Kvartalsvis nr 3527

Stock correlation was a widely used approach to build structures throughout in 2019. Garantum sold several high-performing correlation-based structures throughout the year including the country’s best performer - Autocall Svenska bolag Combo Kvartalsvis nr 3527, which delivered a 125.40% capital return on the back of a 24.36% annualised performance.

This worst of option/autocall structure which was linked to a basket of Swedish stocks including JM, Ericsson, Electrolux and SKF paid out 125.40% capital return (24.36% pa) after one year on December 13. The underlying basket performance was observed quarterly and the product would knock out if all shares in the basket was at or above 90% of their initial levels after one year paying out 105.3%. If the worst performing share has fallen below 90% but not below 70% of its initial level, the product offered a coupon of one percent and would have continued until maturity. At maturity, if all shares are at or above 50% of their initial levels, the product offered to return the initial investment plus any accumulated coupons. If the worst performing share was below 60% of its initial level, then the initial capital would have been eroded 1:1 with its fall.

France

Société Générale - Sélection France Décembre 2019

Decrement indices (aka synthetic dividends) have been in focus in France over the last

couple of years. Although the performance of these indices has been in question, SRP research shows that autocalls linked to decrement indices have been delivering higher realised return to investors compared with benchmark indices.

For the first time, SRP has recorded a decrement play among the top 10 best performing products in 2019 in France. The Autocallable Note on SBF Top 80 EW Decrement 50 sold by Primonial’s DS Investment Solutions and issued by Société Générale, matured on its first observation date, delivering a 112% capital return. This growth product was linked to the performance of the SBF Top 80 EW Decrement 50 Points.

However, the best performer in France in 2019 was the SL - Athena Casino Septembre 2018, another knock out protected tracker structure linked to the share of Casino GuichardPerrachon, which delivered 109.5% capital return after one year, which equates to a 20.08% annualised performance.

Switzerland

Vontobel - Barrier Reverse Convertible on Wirecard AG (Quanto USD)

After a price drop in February, Vontobel issued a three-month reverse convertible offering a payment of 11.5% (47.58% pa) based on the share of Wirecard, a US company at the centre of some accounting trouble. The capital was at risk if the share of Wirecard fell an extra 40% between 15 February and 15 May. Investors jumping onto this opportunity received one of the highest payouts of 2019 as the company’s share appreciated steadily since the strike date delivering a 51% return in just three months.

Despite the performance of this opportunistic structure, Vontobel managed to deliver the highest return across all European markets after its three-month 65.07% pa. This Physical Settled Worst of Equity Barrier Reverse Convertible also sold in Switzerland, matured in mid-April paying out 116.04% annualised performance (estimated 75.06% pa).

This reverse convertible/worst of option income product linked to a basket of shares comprising Apple, Netflix, Twitter offered a 65.07% fixed coupon alongside the initial investment if at maturity all underlyings were at or above their strike levels. Otherwise, investors receive a predetermined amount of the worst performing underlying.

The Netherlands

Besi Click 19%

In The Netherlands, a domestic share was also behind the best-performing structure sold among retail investors. The product, which was marketed by Wilgenhaege Capital Markets and issued by Société Générale, expired early on September 2019 paying out a 123.72% net return or 23.58% pa.

This knockout/protected tracker growth play was linked to the share of Besi (BE Semiconductor Industries NV). The product promised to mature early after one, two, three or four years if the share had stayed the same or has risen compared to its initial level paying out a 27.8% coupon per year elapsed.

Otherwise, the product would have continued until maturity paying 195% capital return if the share was at or above its initial level or 100% capital return if the share had fallen but not below 70% of its strike level in which case investors’ capital would have been eroded one to one with the fall of the underlying and paid out in shares.

United Kingdom

FTSE/STOXX Kick Start Plan - October 2018

In the UK, a basket of indices featuring the domestic FTSE 100 and its European counterpart the Eurostoxx 50 delivered the best return to retail investors.

The product, which was sold by Meteor Asset Management and issued by HSBC, expired

on 14 October paying out a 115% capital return/14.91% pa annualised performance. The structure, which comprised a combination of knock out, reverse convertible, and worst of option payoff types, promised to repay the initial capital plus a 15% coupon, increasing by 10% per year elapsed, from the first anniversary onwards if the worst performing underlying was at or above its initial level.

At maturity, if the worst performing underlying was at or above its initial level, the product would have paid 175% capital return. However, if the worst performing underlying was below 100%, but above 60%, the product would have paid out the initial capital invested. Otherwise, the initial capital would have been reduced 1:1 with the fall of the worst performing index.

Portugal Bono Estructurado ES0313679F36

The best-performing product in Portugal was at the lower end of the European performance ranking. The knockout/reverse convertible expired on 3 July paying out 104.20% capital return.

This was a growth and income product linked to the Eurostoxx Select Dividend 30 which featured in just 149 products across Europe but was the second underlying in the region for 2019 with €2.6 billion in sales, only behind the Eurostoxx 50 which appeared on over 44,000 products worth an estimated €10.9 billion.

Investors in this product sold by Spain’s Bankinter placed 70% of the initial investment in a one-year deposit account paying a fixed coupon of 0.6% after the first year while the remaining 30% was linked to the underlying index. The five-year product promised to mature early at any of the annual observation dates paying a 4.2% coupon per year elapsed if the underlying was at or above 100% of its initial level. The product also featured a 65% defensive barrier at maturity.

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6.0 Shortlists

6.1 Manufacturers

Best House, Europe

Banca IMI

BNP Paribas

Leonteq

Société Générale

Vontobel

Best House, Interest Rates

BNP Paribas

Deutsche Bank

Goldman Sachs

Société Générale

UBS

Best House, Equities

Banca IMI

BNP Paribas

Leonteq

Société Générale

Vontobel

Best House, Autocalls

BNP Paribas

Credit Suisse

Leonteq

Société Générale

UniCredit

Best House, Warrants

Deutsche Bank

HSBC

Société Générale

UBS

Vontobel

Best Institutional House

BNP Paribas

Citi

Goldman Sachs

Morgan Stanley

Société Générale

6.2 Best Service Providers

Best Index Provider

Bloomberg

MSCI

SG Index (Société Générale)

Solactive STOXX

Best Pricing & Analytics Provider

Bloomberg

FVC

LPA/Modelity

SIX Financial Information

Thomson Reuters

Best Kids and Priips Provider

Bloomberg

Deloitte

Delta Capita

LPA/Modelity

WallStreetDocs

Best Issuance Platform

BNP Paribas - Smart Derivatives

Deutsche Bank - autobahn

Leonteq - Constructor

Société Générale – SG Markets SP

Vontobel – Deritrade

Best Law Firm

Allen & Overy

Ashurst

Clifford Chance

Linklaters

Simmons & Simmons

Best Trade Association

AFPDB

DDV

EUSIPA

SVSP

UKSPA

Best House, Middle East and Africa

BNP Paribas

HSBC

Leonteq

Société Générale

Standard Bank

Best House, ESG

BNP Paribas

Crédit Agricole

Goldman Sachs

Natixis

Société Générale

Best Smart Beta Index Provider

Euronext

MSCI

S&P Dow Jones Indices

SG Index (Société Générale)

Solactive

STOXX

Best Structured Products and Derivatives Exchange

Börse Stuttgart

Euronext

London Stock Exchange

Luxembourg Stock Exchange

The Swiss Stock Exchange, SIX

6.3 Distributors/Private Banks

Best Distributor Europe

Banca Generali

Equitim

Mariana Capital Markets

Strukturinvest

Vontobel

Best Distributor Benelux

AG Insurance

BNP Paribas

Crelan

Deutsche Bank

KBC

Best Distributor Eastern Europe

Alior Bank

Getin Holding

KBC

Raiffeisen Centrobank

UniCredit

Best Private Bank Europe

BNP Paribas

KBC

Nordea

Société Générale

UniCredit

Best Distributor UK & Ireland Investec

Mariana Capital Markets

Meteor Asset Management

Société Générale

Walker Crips

Best Performance Europe

Banca Generali

Equitim

Meteor Asset anagement

Mariana Capital Markets Strukturinvest

Best Distributor Germany & Austria

DekaBank

Deutsche Bank

DZ Bank

Raffeisen Bankengruppe

UniCredit

Best Distributor Italy

Banca Generali

Exane Derivatives

Intesa Sanpaolo

Leonteq

UniCredit

Best Distributor France

Amundi

BNP Paribas

Equitim

Natixis

Société Générale

Best Distributor Nordics

Alexandria Markets

Exceed Capital

Garantum Fondkommission

Nordea

Strukturinvest

6.4 Other Awards

Best

Best Capital-Protected

Distributor Europe

Intesa Sanpaolo

KBC

Standard Bank

Strukturinvest

UniCredit

Best Distributor Switzerland

Credit Suisse

Leonteq Securities

Raiffeisen Switzerland

UBS

Vontobel

Best Yield Enhancement

Distributor Europe

Banca Generali Investec

Mariana Capital Markets Mediobanca

Strukturinvest

Empowering the Structured Products World through Education

Introducing the SRP Academy

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Access exclusive thought leadership articles

Everything you need in one space

7.0 Awards Results

7.1 Best House and Distributor winners

Manufacturer awards

Best House, Europe Société Générale

Best House, Middle East and Africa Standard Bank

Best House, Equities BNP Paribas

Distributor/Private Banking awards

Best Distributor Europe Vontobel

Best Performance Europe Banca Generali

Best Distributor Capital-Protected UniCredit

Best Distributor Yield Enhancement Banca Generali

Best Private Bank KBC Asset Management

Service Providers

Best Index Provider Solactive

Best Law Firm Simmons & Simmons

Best Pricing and Risk Analytics Provider Bloomberg

Other awards

Personality of the year Samy Beji

Deal of the year

Natixis’ full green equity-linked structured note entirely dedicated to financing energy transition

Best House, Interest Rates UBS

Best House, Autocalls BNP Paribas

Best House, ESG Société Générale

Best House, Warrants UBS

Best Institutional House BNP Paribas

Best Distributor Benelux KBC

Best Distributor Germany & Austria UniCredit

Best Distributor UK & Ireland Investec

Best Distributor Nordics Garantum Fondkommission

Best Distributor Eastern Europe UniCredit

Best Distributor Italy Intesa Sanpaolo

Best Distributor Switzerland Credit Suisse

Best Distributor MEA Standard Bank

Best Trade Association Deutscher Derivate Verband (DDV)

Best Kids and Priips Provider LPA/Modelity

Best Smart Beta Index Provider S&P Dow Jones Indices

Best Issuance Platform Société Générale - SG Markets

Best Structured Product and Derivatives Exchange SIX Swiss Exchange

Index of the year

JPMorgan’s Economic Cycle Factor Rotator Index

Best Structured Product Technological Solution Bloomberg

Best Educational Initiative DDV’s series of English language films, events and lobbying work on behalf of the structured product industry (‘Knowledge and information create clarity’)

7.2 Best Sales and Performance by Region and Country

Austria

Best Distributor UniCredit

Best Performance Raiffeisen Centrobank

Belgium

Best Distributor KBC

Best Performance KBC

Czech Republic

Best Distributor ČSOB

Best Performance ČSOB

Denmark

Best Distributor Nordea

Best Performance Jyske Bank

Finland

Best Distributor Alexandria Markets

Best Performance United Bankers

France

Best Distributor Amundi

Best Performance Equitim

Germany

Best Distributor UniCredit

Best Performance UniCredit

Hungary

Best Distributor UniCredit

Best Performance UniCredit

Ireland

Best Distributor BCP Asset Management

Best Performance BCP Asset Management

Italy

Best Distributor Intesa Sanpaolo

Best Performance Banca Generali

Mauritius

Best Distributor LS Advisors

Best Performance LS Advisors

Norway

Best Distributor Nordea

Best Performance Garantum Fondkommission

Poland

Best Distributor Citi Handlowy

Best Performance Citi Handlowy

Portugal

Best Distributor Millenium BCP

Best Performance Banco Privado do Atlantico

Russia

Best Distributor Sberbank

Best Performance Sberbank

Slovakia

Best Distributor Raiffeisen Centrobank

Best Performance KBC

South Africa

Best Distributor Investec

Best Performance Standard Bank

Spain

Best Distributor Bankinter

Best Performance Bankinter

Sweden

Best Distributor Garantum Fondkommission

Best Performance Strukturinvest

Switzerland

Best Distributor Credit Suisse

Best Performance Credit Suisse

The Netherlands

Best Distributor Kempen & Co

Best Performance Wilgenhaege

United Kingdom

Best Distributor Investec

Best Performance Mariana Capital Markets

8.0 Appendix Analysis of respondents