Swiss-based structured products provider says unprecedented market conditions drove strong performance in the first half.
Leonteq saw strong increases in all of its key financial metrics in the first half, with net profit rising 59 percent to 118 million francs while return on equity reached an eye-watering 29 percent, according to an ad hoc announcement published on its website Thursday.
Leonteq CEO Lukas Rufflin characterized the «exceptional growth» in revenues and profitability, saying it was helped by heightened market volatility but that it also demonstrated the resilience of its business and its effort to diversify revenue streams in recent years.
«The first half of 2022 was marked by unprecedented market conditions with elevated levels of overall market volatility, including exceptional fluctuations in the share prices of selected large-cap companies at around the time of their fourth quarter 2021 and first quarter 2022 earnings announcements» Leonteq indicated in the announcement.
Disciplined Risk Management
The company indicated a continued focus on disciplined risk management and a five-fold increase in net trading results in the first half.
«At the same time, in view of the generally more challenging market environment for investors, Leonteq recorded subdued levels of client activity in most of its regions, reducing net fee income by 32% compared to the same period of 2021. This was also driven by a significant reduction in the number of large ticket transactions,» Leonteq indicated.
Despite this, turnover generated from its own issued products remained relatively stable, with much of the decline attributable to platform partners, which indicated investor confidence in its investment grade credit rating and its status as an established player in the market. Given the current situation, it remained confident it would surpass 20210's record net profit when full-year results are released.
