The global structured products market is under intensifying scrutiny from rule-makers. Companies are now needing to constantly evolve to respond to the complex and ever-changing regulatory landscape,
Oliver has 18 years’ experience in financial services gained as a management consultant and then investment banking COO for global tier 1 institutions.
The global structured products market is under intensifying scrutiny from rule-makers. Companies are now needing to constantly evolve to respond to the complex and ever-changing regulatory landscape, whilst also managing costs and efficiency. There are several ways that companies can do this by looking at industry forums and managed services.
This year alone, the Structured Product industry faces a slew of changes in rules and guidance. In the UK, the regulator is also looking for disclosure improvements following its latest Priips policy (March 2022). Its radical Consumer Duty rules, which start enforcing in July 2022 also apply to retail structured products.
Structured products are covered by the new guidance on Packaged Retail and Insurance-based Investment Products (Priips), which will come into force in January 2023. Meanwhile, sustainability continues to top the industry’s agenda as issuers and distributors seek clarity around the EU green taxonomy.
In the US, the regulator has issued fines in a string of cases where derivatives and complex products harmed investors. In March 2022, a consultation was issued on complex products and options in light of continued concerns and increased activity.
In Asia, discussions about shortcomings in the Chinese structured deposits market continue; and the Thai regulator is proposing rule changes to simplify structured products and restrict their issuance by corporates.
Futureproofing your business
As a structured product market participant, how can you keep up with all these changes while continuing to drive efficiencies?
Industry forums run by Delta Capita are an effective way to share knowledge and best practice and build consensus for your processes compliance solutions.
But the impact of developing, implementing and maintaining change projects to support your evolution is so large, you should consider managed service solutions too.
Managed services deliver non-core, non-competitive processes, bringing you multiple benefits.
Benefits of managed services
Outsourcing managed services means giving the task of maintaining and futureproofing your non-core processes and functions to a third-party who can execute them more cost-effectively. Doing this also helps you remain compliant with regulatory obligations in a streamlined and cost-efficient way.
Third-party providers can help ease the burden of having to digest and consider the impacts of regulatory changes on all your business areas. The third-party provider’s dedicated expert resources can help your firm alleviate resource constraints and bottlenecks. They can also help you adopt the latest technology and best practices; and confidently demonstrate regulatory compliance.
Managed services operated in conjunction with industry forums, and experts can build shared services that benefit multiple partners, while ensuring they meet individual needs. The best-managed service providers have the flexibility and scale to deliver bespoke requirements seamlessly, alongside standardised services.
How Delta Capita can help
Many leading structured product issuers use Delta Capita’s team of experts and our specialist technology to reduce the strain on their resources and benefit from industry standards and cost mutualisation.
Delta Capita’s inSPire Due Diligence service offers a digital platform and managed service. This is a single point of contact for gathering distribution agreement drafting support; ‘know your distributor’ due diligence questionnaires and data; and data and management information supporting Consumer Duty and ESG requirements.
This service proposition is unique to Delta Capita and comes with our powerful expertise in standardisation; technology; managed services; and information exchange.
Get in touch to find out more.