Swiss Fintech Leonteq expects reduced profits
Leonteq, a Zurich-based fintech company that operates a marketplace for structured investment products, has lowered its earnings expectations for this year due to a drop in client demand in the second half of 2022.
The Swiss fintech saw continued decline in customer demand due to the general difficulty of current market conditions. However, the firm said its monthly net income fee remained stable during the period.
“At the same time, Leonteq continued to maintain a prudent approach to risk management with net trading results compensating for subdued customer activity, particularly in the third quarter of 2022,” the company said in a business update. It added, “As a result, Leonteq expects to report a consolidated profit for 2022 in the range of the previous year’s record profit of CHF 155.7 million, corresponding to EPS of CHF 8.47 (previous guidance was to surpass the previous year’s consolidated net profit).”
Earlier in October, whistleblowers in a Financial Times report accused Ernst & Young Global Limited, one of the Big Four accounting firms, of laundering suspicious trades it found in its company records. However, in its response, Leonteq denied the allegations.
According to the Swiss fintech, both internal and external investigations of the records found no evidence to confirm the claims. “Leonteq strongly refutes these allegations, which were first raised internally in 2021 and were thoroughly investigated by Leonteq’s Compliance department,” Reuters quoted the company as saying in a statement.
Leonteq helps Swissquote become an issuer of structured products
Meanwhile, earlier this year, Swissquote became an issuer of structured investment products by partnering with Leonteq. During the collaboration, the financial services provider issued its own structured product under the Yield Booster brand.
“Swissquote’s Yield Boosters are quanto derivatives, meaning that the underlying is denominated in one currency and settled in another. This gives investors exposure to foreign assets without corresponding exchange rate risk,” Swissquote explained on its website.
Leonteq, a Zurich-based fintech company that operates a marketplace for structured investment products, has lowered its earnings expectations for this year due to a drop in client demand in the second half of 2022.
The Swiss fintech saw continued decline in customer demand due to the general difficulty of current market conditions. However, the firm said its monthly net income fee remained stable during the period.
“At the same time, Leonteq continued to maintain a prudent approach to risk management with net trading results compensating for subdued customer activity, particularly in the third quarter of 2022,” the company said in a business update. It added, “As a result, Leonteq expects to report a consolidated profit for 2022 in the range of the previous year’s record profit of CHF 155.7 million, corresponding to EPS of CHF 8.47 (previous guidance was to surpass the previous year’s consolidated net profit).”
Earlier in October, whistleblowers in a Financial Times report accused Ernst & Young Global Limited, one of the Big Four accounting firms, of laundering suspicious trades it found in its company records. However, in its response, Leonteq denied the allegations.
According to the Swiss fintech, both internal and external investigations of the records found no evidence to confirm the claims. “Leonteq strongly refutes these allegations, which were first raised internally in 2021 and were thoroughly investigated by Leonteq’s Compliance department,” Reuters quoted the company as saying in a statement.
Leonteq helps Swissquote become an issuer of structured products
Meanwhile, earlier this year, Swissquote became an issuer of structured investment products by partnering with Leonteq. During the collaboration, the financial services provider issued its own structured product under the Yield Booster brand.
“Swissquote’s Yield Boosters are quanto derivatives, meaning that the underlying is denominated in one currency and settled in another. This gives investors exposure to foreign assets without corresponding exchange rate risk,” explained Swissquote on its website.
