Structured Products Awards for Excellence 2018 – Best Structured Product Provider – FX

2018 Winners

Best Structured Product Provider – FX

BNP Paribas

Ken Tan
head of FX investors solutions, WM&FO, global markets APAC, BNP Paribas

FX volatilities in 2018 generally picked up from the previous year, and there were some spikes through the year as markets reacted to geopolitical and trade war-related news. Broad trading ranges on G10 currencies prevailed, and private bank clients favoured taking tactical positions within the range.
Fuelled by geopolitical and trade war-related headlines, FX volatility spiked in 2018, led by emerging market currencies. The Venezuelan bolivar experienced hyperinflation which prompted President Nicolás Maduro to slash five zeroes off its denomination; the Turkish lira has plummeted 37% year-to-date due to shaky economic conditions that were further exacerbated by American pressure; and the contagion further spread to other emerging market currencies including the Argentine peso and the South African rand.

Such extreme levels of volatility rendered these currencies unideal as underliers for flow distribution in Asia. Naturally, private banking clients opted to focus FX investing in G10 currency pairs where broad trading ranges prevailed. EUR, for example, started to move in greater tandem with the dollar after a surprise 12% strengthening against the greenback last year.

BNP Paribas in 2018 distinguished itself within this sweet spot of rangebound trading and assisted structured product investors in Asia by exploiting these ranges through tactical positioning. It showcased various innovative payoff structures to implement a number of plays including the expression of short-term views through target advance KO forwards, better strikes through dual currency target KO forwards, and the implementation of downside protection through pivot target with EKO.

Its extensive range of FX structured product solutions catering to various market conditions and investor views paved the way for BNP Paribas to earn the praise of Asia’s private banks and the title of Best Structured Product Provider – FX.