Low volatility and low yields are making life tricky for structured product providers. But by broadening their range of products and by doing more to tap upcoming markets, such as Asia, they have been able to ensure they get plenty of business.
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New regulations are having a profound impact on structured finance and securitisation markets. But the bigger banks are mostly coping, with some even exploiting the situation to build their investor-advisory services.
Index-based structured products have grown in popularity since the financial crisis, as investors have sought flexible and bespoke ways to gain exposure to certain assets. And while the threat of tougher regulation looms, bankers are confident it will not slow down the market.
The Shanghai-Hong Kong Stock Connect will foster stock trading and capital flows between Hong Kong and mainland China, with numerous potential benefits for both sides. But competitors in the Asia-Pacific region are concerned it might eat into their market share.
Observers are already predicting that 2014 will be a record-breaking year for sukuk issuance. While the majority of deals are currently coming out of Malaysia, CIMB Islamic's CEO believes that developments in the pipeline will see the asset class grow its international presence.
Emerging market currencies benefited handsomely from the US central bank’s huge quantitative easing programme. With that now being unwound and with China slowing, emerging currencies are now in retreat. Those from economies with weak fundamentals are especially vulnerable.
The European high-yield bond market has come a long way from its infancy in the late 1990s to record issuance in 2012 and 2013. But with interest rates threatening to rise, can the market stay on track for another bumper year in 2014?
Tighter secondary market liquidity and more volatile interest rates make for a more challenging environment for the highest-rated issuers, but that has not stopped Deutsche Bank from leading two milestone deals already in 2014.