New Products
Switzerland's Leonteq Partners With Bank For New Structured Products "Hub"
The business model is designed to cut the costs to banks of bringing structured products to market, and also speed up development and launch times, Leonteq, which is listed on the SIX exchange, said.
Switzerland-listed structured products provider Leonteq has rolled out its
first products with VP
Bank as sponsor and structuring hub. The hub is designed to
bring offerings to the market more rapidly and reduce the costs
to banks for using the Leonteq system.
Leonteq is now offering a new standardised issuance model for
private, commercial and retail banks which allows them to pivot
from being an intermediary to a producer of structured investment
products. Banks joining Leonteq’s ecosystem for investment
solutions as a sponsor get access to its services and digital
tools. Leonteq will act as the initial hedger and, at a later
stage, plans to offer best option prices via its balance sheet
light business, including its Smart Hedging Issuance Platform
(SHIP), it said in a statement.
To get the new business model off the ground, structuringHUB SA –
as it is called – has been established as a standalone
securitisation undertaking in Luxembourg independent from
Leonteq. It will issue structured products which will be
guaranteed by the sponsors. Leonteq will act as the arranger,
providing its longstanding expertise as well as its full
technology platform and a broad range of services along the
entire value chain.
Sponsors will obtain access to the product and service offering
of Leonteq while only providing standard commercial banking
services in the context of the issuance by
structuringHUB.
As previously announced on 17 January 2022, Leonteq and VP Bank
are cooperating to make and distribute structured products. In
the weeks since, VP Bank has become the first sponsor under this
new white-labelling issuance model and will use Leonteq’s LynQs
platform to price, trade and distribute VP Bank-guaranteed
structured products issued by structuringHUB to its
clients.
“The innovative issuance model of Leonteq enables us to provide
structured products in a highly automated and efficient manner.
This allows us to improve our client offering and demonstrate
investment expertise via tailor-made structured products, while
limiting the complexity of the issuance process,” Paul Arni, CEO
of VP Bank, said.