A US-based investment product linked to Africa’s higher yielding emerging markets presents a powerful proposition to global investors looking to access African yield, according to Standard Bank.

The Bank has recently initiated its Luxembourg structured note programme, which extends its “product offering by providing investors in South Africa, the rest of Africa and globally, the opportunity to access African yield in sovereign and corporate debt - as well as foreign exchange - via risk-managed structured products,” according to Hennie Snyman, Co-Head of Client Solutions for Institutional Investors at Standard Bank.

Investors seeking growth outside of South Africa’s market will not find many US dollar-based investment vehicles that provide access to African growth via structured products. 

Since the JSE offers exclusively ZAR-denominated listed investments, investors looking for broader opportunities can now put their capital to work through CLNs providing, “US dollar-based access to African yield that reflects corporate and sovereign growth across Africa’s multicurrency environment,” said Snyman.

A Bloomberg League Table recently ranked Standard Bank 12th globally in terms of the volume of Credit Linked Note (CLN) issuance in US dollar equivalent.

CLNs are structured investments issued by banks delivering enhanced returns to institutional investors in exchange for taking credit risk on specific third parties.

Standard Bank’s US dollar-based structured note programme represents the bank’s newest innovation in leveraging risk-managed African credit opportunities.

According to Anastasia Halamandaris, Co-Head of Client Solutions for Institutional Investors at Standard Bank, the fact that Standard Bank is ranked amongst the world’s largest banks such as Citigroup and JPMorgan Chase & Co for CLN issuance “speaks volumes to the strength of our capabilities in structured products generally”.

Standard Bank’s majority market share in ZAR-denominated, listed structured credit issuance, as at the end of September 2017, reflects investor confidence in the bank’s ability to develop bespoke and relevant credit solutions.  

This is an especially important message for global investors seeking to partner with a well-established product house able to leverage multi-asset African returns.

Being present in 20 markets across the continent enables Standard Bank to understand the African corporate and sovereign debt landscape. 

“This insight – and the trust it inspires – cannot be replicated unless you are present, on the ground, working with African corporates and regulators every day,” said Halamandaris. 

“Given the strong element of probity and trust required in syndicating debt, our presence and deep insight into corporates on the continent is a significant advantage that other global banks can’t easily emulate,” she added.