Leonteq AG (SIX: LEON) announced today that Fitch has revised Leonteq’s outlook to Positive from Stable and affirmed its investment grade rating at “BBB-”.
The rating agency Fitch Ratings Ltd. has revised the outlook on Leonteq AG’s, Leonteq Securities AG’s and Leonteq Securities AG’s (Guernsey Branch) long-term issuer default rating (IDR) to Positive from Stable and affirmed them at “BBB-”.
The outlook revision primarily reflects Fitch's view that after pandemic-related disruption, Leonteq is now in a better position to implement its strategy of increasing operational scale and further improving business diversification, increasing its balance sheet-light revenue base (including more hedging via its capital-efficient Smart Hedging Issuance Platform, SHIP) and further strengthening the group's capitalisation.
According to Fitch, the affirmation of the long-term IDRs assigned to Leonteq reflect its adequate capitalisation (including growing capital base), sound risk management systems, solid liquidity management, moderate and well-managed credit risk exposure, relatively resilient earnings base as well as its sophisticated and scalable structured products issuance platform.
Fitch additionally states that the IDRs also reflect Leonteq's fairly concentrated franchise and the group's moderate, albeit increasing, size (primarily in terms of turnover and revenue). According to Fitch, management is addressing these constraints by improving issuance partner diversification and transaction volumes, improving balance sheet efficiency by further rolling out SHIP and other capital efficient revenue sources and maintaining Leonteq's capital base above CHF 800 million. Fitch views these ambitions as achievable in the short to medium term, which is reflected in the Positive Outlook on Leonteq's Long-Term IDR.
Further information can be found at: fitchratings.com
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Leonteq Investor Relations
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LEONTEQ
Leonteq is a Swiss fintech company with a leading marketplace for structured investment solutions. Based on proprietary modern technology, the company offers derivative investment products and services and predominantly covers the capital protection, yield enhancement and participation product classes. Leonteq acts as both a direct issuer of its own products and as a partner to other financial institutions. Leonteq further enables life insurance companies and banks to produce capital-efficient, unit-linked pension products with guarantees. The company has offices and subsidiaries in 13 countries, through which it serves over 50 markets. Leonteq AG is listed on the SIX Swiss Exchange (SIX: LEON).
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