Avaloq, DBS, Leonteq and Numerix plan structured investment collaboration

Avaloq, DBS, Leonteq and Numerix have signed a letter of intent for the implementation of an integrated multi-issuer investment products distribution system. The cooperation will enhance the offering and distribution of structured investment products. Through this initiative, Avaloq connects the IPDS to the Avaloq Banking Suite, with DBS as the pilot bank. For the first phase, the new platform will focus on the Asia Pacific region.

On 13 June 2014, Avaloq and Leonteq had announced an agreement to further automate the processing of structured investment products in building an upgradable interface between the Avaloq Banking Suite and the Leonteq products and services platform for Leonteq customers using the Avaloq Banking Suite. On 4 November 2014, Leonteq further announced the launch of the products partnership with DBS in the origination and distribution of equity derivatives structured products. The IPDS extends these collaborations.

In particular Avaloq, DBS, Leonteq and Numerix agreed to build the IPDS as a platform for the following:

(1)    access to structured investment products to be provided by DBS and/or Leonteq. In the future, it will be extended to other selected product issuers, along with other products and instrument types

(2)    a web-based solution to enable real-time, multi-user, analytics-based product structuring and pricing, as well as intuitive RFQ and trade and order management workflow provided by Numerix

(3)    access to designated automated services on Leonteq’s integrated technology and product services platform;

 (4)    connectivity to the Avaloq Banking Suite, which allows straight through processing (STP) of trades in these products.

The co-operation is highly complementary to the business strategies of the four partners in Asia and internationally in terms of their respective existing product and service offerings. It also builds on Avaloq’s industry leadership and growth strategy as well as Numerix’s aim of being a leading provider of cross-asset analytics for derivatives valuations and risk management in the region.

The co-operation will provide further revenue and cost synergies from the pooling of infrastructure, information technology and other support services. It will improve the quality and capabilities of services for clients of structured investment products. The implementation of the IPDS will start immediately.

Jan Schoch, CEO Leonteq said: “The co-operation between these four partners is a substantial step in creating a highly innovative investment platform. What makes this platform unique is the fact that it is based on a buy-side approach, providing services to enhance customers’ experience. It is an honor for Leonteq to work together with such esteemed partners, pooling their expertise around this investment solution.”

Andrew Ng, Head of Treasury & Markets, DBS Bank said: “We see this partnership as an opportunity for DBS to pioneer a next-generation digital banking platform, in line with our desire to shape the future of banking. Through this initiative, we hope to broaden our customer base and deepen our service offerings. This platform brings together, for the first time, best-of-breed distribution, analytics, wealth management CRM and portfolio management technologies which allows us to distribute and offer structured investment products efficiently and in a holistic manner.”

“We are very excited to be part of one of the most significant partnerships in the financial services industry in many years. This collaboration not only demonstrates what can be accomplished by leveraging best of breed technologies, but will be a lynchpin in the transformation of the structured products market,” said Steven O’Hanlon, CEO of Numerix.

Francisco Fernandez, CEO of Avaloq, comments: “The collaboration with DBS, Numerix and Leonteq is a further milestone for Avaloq’s strategy of becoming a powerful industry standard and a marketplace. Already today, our customers manage assets worth USD 3,900 billion using the Avaloq Banking Suite. This innovative solution will enable banks and wealth managers to access and provide new financial products quickly. Also, it is based on standardised processes and fully compliant with the respective local regulations. We’re very happy to have found the right partners to join forces with.”