Asian private banking clients have traditionally been much less risk-averse than their European counterparts and do not typically buy capital-protected structured products. As a result, many private banking clients had big structured product exposures to falling stock markets in late 2008 and early 2009. Losses were compounded by the fact that many high-net-worth individuals expected their banks to extend credit and so were hit by margin calls as markets plummeted.
One private bank estimates structured product sales are currently at about 20% of 2006 or 2007 levels. However, the market is once again gaining momentum.