An Actively Managed Certificate (AMC) is a structured financial instrument that securitizes an actively managed investment strategy into note form. In practical terms, an AMC is a debt security (note or certificate) issued by a financial institution (often a bank or an affiliated issuer entity) whose payoff is linked to the performance of an underlying reference portfolio selected by a professional manager. This underlying portfolio is actively traded and rebalanced over time according to a defined strategy or mandate. Investors hold a tradeable certificate with an ISIN code that reflects the value of the managed portfolio
Critically, an AMC allows the strategy manager to change the composition of the underlying basket without issuing a new security each time. The note is typically structured as a tracker (delta-one) on a notional portfolio or index that the manager controls. For example, the manager can rotate the portfolio from stocks to bonds, add new securities, or adjust weightings, all within the existing certificate’s legal wrapper. These ongoing adjustments are reflected in the certificate’s value in real time. This feature sets AMCs apart from static structured notes.
Distinction from Traditional Structured Products: Traditional structured products (e.g. autocallable notes, capital-protected notes) usually have a predefined payoff formula and a fixed set of underlying assets determined at issuance. In contrast, an AMC has no preset payoff formula or maturity payoff condition; it simply delivers the linear (possibly leveraged) performance of the underlying managed portfolio (minus any fees). There are no guarantees; the investor’s outcome depends on the skill of the manager and the market’s movements of the chosen assets. In essence, an AMC is a “participation” product investors participate in the gains or losses of the evolving reference portfolio, much like they would in a managed account, except delivered via a note. This means no capital protection or fixed coupons are typically offered, unlike many structured products. The trade-off is that the strategy can be dynamic and responsive, rather than static.
Distinction from Funds: AMCs also differ from traditional fund vehicles (mutual funds, ETFs, etc.). Legally, AMC investors are creditors of the issuer (bank or SPV) rather than beneficial owners of the underlying assets. The AMC provides synthetic economic exposure to those assets. This synthetic structure often allows lower regulatory overhead (as discussed later) and much faster setup. Unlike a UCITS fund which must comply with diversification limits and extensive regulations, an AMC has no strict asset eligibility or diversification rules beyond what the issuer permits. For example, an AMC can theoretically include illiquid or alternative assets (real estate, loans, crypto, private equity) that many funds cannot touch. The flip side is that investors bear the credit risk of the issuer (since it’s a debt obligation). If the issuing bank or vehicle fails, the investor may not fully recover funds, a risk not present in segregated fund structures. In practice, issuers mitigate this risk via collateral provisions or using bankruptcy-remote SPVs, but counterparty risk remains a defining consideration of AMCs.
Financial institutions across Europe, Asia, and Africa are increasingly turning to AMCs as a strategic product offering to complement or even replace traditional investment products. By offering AMCs, banks and dedicated issuance platforms (like securitization vehicles) can unlock multiple benefits: new revenue opportunities, differentiation through innovation, deeper client engagement, and asset-management-like capabilities, all with a scalable, capital-light model.
One of the most compelling reasons for banks to offer AMCs is the fee-based revenue they generate. Much like other structured products, AMCs allow the issuer to charge various fees for structuring and maintaining the product. Typically, a bank will earn an upfront structuring or issuance fee, as well as annual management/administration fees embedded in the product (often a percentage of assets under management in the AMC). For example, an issuing bank might charge an annual platform fee of 0.2% – 1.0% on the assets in the AMC, which directly contributes to recurring revenue. In addition, because the bank (or its market-making affiliate) handles trade execution for the AMC’s portfolio, it can capture trading commissions or bid-ask spreads on those transactions. If the AMC is listed or traded OTC, the bank may also act as the market maker, earning a spread on secondary market trades.
Crucially, this revenue comes with limited risk exposure for the issuer. The market risk of the portfolio is borne by the investors in the AMC, not by the bank’s balance sheet, the bank’s role is to facilitate the strategy and pass through the performance. Aside from short-term liquidity provisioning or hedging while executing trades, the bank isn’t taking directional positions. This means the fee income has attractive margins. AMCs allow banks to monetize their structuring and trading capabilities in a relatively low-risk way. The result is often a high return on equity for the AMC business line.
To illustrate the scale, consider a bank that accumulates the equivalent of USD 5 billion across various AMCs on its platform, not an unrealistic figure in today’s market. At an average fee of 0.5% per annum, that yields about USD 25 million in steady annual revenue, with high profit margins due to vestr’s automation and low capital usage. It’s easy to see why many private banks now view “AMC platforms” as a service offering in itself: the more external asset managers or advisors they onboard to launch strategies via AMCs, the more assets and fees accrue.
In an investment product marketplace crowded with funds and look-alike notes, AMCs give banks a chance to stand out through innovation. The flexibility of an AMC’s structure means issuers can rapidly design and launch new thematic or bespoke strategies without the lengthy setup of a fund or the complex payoff engineering of a typical structured note. This enables a bank’s product development team to be extremely agile and responsive to market trends.
For example, if there is sudden client interest in a niche theme, say “artificial intelligence in healthcare”, a bank could roll out an AMC that actively invests in a basket of AI-focused healthcare stocks and related assets. With an existing AMC issuance program, the bank might seed the strategy and issue the certificate in a matter of weeks. By contrast, creating a new fund product (even an ETF) could take many months and risk missing the market window. This speed-to-market is a significant advantage, allowing new investment ideas to be introduced swiftly while the theme is hot.
Additionally, because the underlying portfolio can be tweaked on the fly, an AMC can evolve over time (e.g. rotating sub-themes or adapting to market conditions) without launching a new product each time. This means a single AMC can stay relevant longer and serve evolving client needs, further differentiating the bank’s offerings. Banks have used AMCs to roll out “trend baskets” that are periodically adjusted by the manager as the trend evolves, something static products cannot replicate.
Beyond thematic investing, AMCs allow mass customization of products. A bank can create one-off strategies for specific clients or segments and deliver them as proprietary products. Traditional providers might say “no” to an unusual client request due to operational constraints. This capability turns bespoke portfolio management into a packaged product, setting the bank apart from competitors.
This kind of product differentiation helps position the institution as a market leader and innovator. It can improve client acquisition (“come to us, we can build what you need”) and also earn media/industry recognition for being on the cutting edge (for instance, early adopters of including digital assets or AI strategies in AMCs are often highlighted in industry conferences).
From a client relationship perspective, Actively Managed Certificates serve as a powerful tool for engaging clients and delivering customized solutions. Private banks and wealth managers know that ultra-high-net-worth (UHNW) clients increasingly demand bespoke portfolios and unique opportunities. AMCs provide a regulated, convenient wrapper to fulfill these demands on a one-to-one or segment-of-one basis. Rather than placing a client’s assets in off-the-shelf funds, a bank can co-create an investment strategy with the client and package it as an AMC, effectively turning the client’s vision into a product that the bank administers.
This level of customization deepens client trust and loyalty. The client feels they are getting something tailored exactly to their preferences (be it ethical exclusions, specific themes, risk level, or leverage), and the bank becomes more of a solutions provider than just a distributor of third-party products. As noted earlier, AMCs enable providing a customized managed account but in security form, even for a single investor. Because the AMC is a transferable security, if that one investor eventually steps out, the bank can offer the same strategy to others, making it feasible to sustain a highly personalized strategy. This is a key advantage over classic managed accounts or mandates, which might be unwound if the client leaves; here the strategy can live on as a product, ensuring continuity and scalability.
AMCs also contribute to client retention and attraction of talented asset managers. For instance, relationship managers or portfolio managers at private banks often have great strategy ideas. In the past, if they wanted to manage money more freely, they might leave to start a fund or a boutique. The bank issues the AMC for them, the PM gets to run their investment vehicle without leaving, and the clients get access to this strategy. It’s a win-win-win: the banker stays (talent retention), the clients are happy with unique strategies, and the bank earns fees while strengthening its team’s loyalty. Similarly, independent external asset managers (EAMs) are drawn to banks that offer vestr’s strong AMC platform: they will bring client business to that bank’s AMC issuance infrastructure if it’s efficient and wide-ranging, increasing assets under custody and overall client connectivity for the bank.
Furthermore, by listing certain AMCs on public exchanges or multi-dealer platforms, banks can engage new client segments beyond their own private clientele. As an example, a bank can issue an AMC and list it on the SIX Swiss Exchange, making it visible to any investor with access to those markets. Independent financial advisors, smaller institutions, or affluent retail investors can then discover and invest in those AMC products. This expanded distribution broadens the bank’s reach and can funnel new clients back to the bank (investors who buy the AMC might eventually seek more services). Some issuers have indeed listed AMCs on multiple exchanges specifically to tap into wider demand and raise their profile in the market. The end result is greater client engagement on multiple fronts: existing clients get bespoke solutions, and new clients are engaged through differentiated products and wider distribution channels.
Actively Managed Certificates blur the line between a bank’s structured product desk and an asset management house. By offering AMCs, banks effectively gain asset management capabilities without needing to set up new fund vehicles. The structured products or securitization team, working with vestr and strategy providers, can create and run numerous distinct portfolios within the AMC wrappers, much as an asset manager runs different funds or mandates. This is extremely powerful from a strategic standpoint: it allows a bank to verticalize its value chain (manufacture products, not just distribute others’) and potentially capture more value.
With vestr’s platform, a single operational setup can support thousands of AMCs, each with a different strategy or manager, without significant additional overhead. The bank becomes a platform for strategy providers (internal or external), akin to running a multi-strategy asset management business on its balance sheet or via its vehicles. Crucially, each AMC can be launched with minimal seed capital (since external investors provide the funding) and low setup cost, unlike traditional funds which often need seed money and critical mass to start. This means even niche strategies can be tried and, if successful, scaled up by attracting more investors.
From a scalability perspective, the AMC model is highly efficient and leverageable. Once the legal issuance program (e.g. a note program or securitization vehicle) is in place, adding a new strategy is mainly a matter of drafting terms and an investment management agreement. Many banks report that launching a new AMC can be done in days and with modest internal effort, thanks to standardized documentation and automation. Moreover, ongoing administration (NAV calculation, portfolio reconciliation, etc.) can be largely automated or handled by a small team, even as the number of AMCs grows. It is not unusual for a bank to host dozens or even hundreds of external managers on its AMC platform simultaneously, each managing their own strategy under the bank’s issuance umbrella. Every additional strategy adds fee income but only marginal operational load.
The ability to include virtually any asset class in AMCs is another differentiator. Want to offer clients exposure to pre-IPO shares, or a basket of hedge funds, or a mix of public and private debt? Doing this in a regulated fund could be infeasible or take years of structuring, but via an AMC it can often be achieved rapidly by referencing those assets in a certificate (assuming the bank can trade or hold them or has an external partner to do so). This means banks can package alternative investments and proprietary strategies without setting up new fund vehicles, tapping into areas normally reserved for specialized asset managers. In effect, the bank can replicate many functions of a global asset manager (multiple strategies across asset classes) just by utilizing the flexible wrapper of AMCs.
Finally, offering AMCs positions the bank as a “solutions platform” rather than just an intermediary. Internally, this fosters a culture of innovation and collaboration between the structuring teams and investment teams. By implementing this, banks transform into product manufacturers, not merely distributors, capturing more value chain and achieving a higher share of client wallet (e.g. providing advice and product execution). The strategic value of this repositioning is significant in an industry where margins on plain brokerage or distribution are shrinking.
Because AMCs are typically fully funded instruments (investors put the capital to invest in the underlying portfolio) and usually delta-one (no complex derivatives that require dynamic hedging), the issuing bank often does not have to deploy significant proprietary capital to support the product. The bank may hedge any interim exposure (and in an on-balance-sheet issuance, it might hold the underlying assets as collateral), but essentially the investors’ funds are what’s invested in the strategy. This contrasts with, say, providing a structured note with capital protection, where the bank might have to set aside reserves or hedging capital.
For on-balance-sheet issuers (issuances directly by the bank), the regulatory capital charge for an AMC program can be relatively low, since the note is a liability matched by an asset position (if assets are held) or offloaded via back-to-back hedges. The credit exposure is mainly the investors lending to the bank (reverse of typical credit risk), so the bank’s own credit risk profile doesn’t expand much. Many AMCs are structured to be off-balance-sheet using orphan SPVs, in which case the bank is just an arranger or service provider, and carries essentially no assets or liabilities on its balance sheet and just earns fees. This makes the return on equity (ROE) of AMC activities very attractive. A bank can grow its AMC-fee income without a proportional increase in risk-weighted assets or leverage, which pleases shareholders and regulators.
From a risk management perspective, AMCs are also appealingly self-contained. The primary risk the issuer takes is operational and reputational (ensuring the product runs as intended, trades are executed properly, and the manager doesn’t breach mandates or laws). Market and investment risk remain with the investors in the certificate. There is no promise of a guaranteed return from the bank but only the promise to deliver whatever the portfolio does, minus fees. This is inherently a lower risk proposition for the issuer than structured products that embed options or guarantees (which can blow up on the issuer’s balance sheet if markets move violently). As long as the bank maintains proper controls, it can scale up the number of AMCs almost as a utility business: each new certificate adds incremental fee revenue without adding proportional risk to the issuer. This doesn’t mean zero risk (operational failures or extreme strategy losses can cause headaches), but it is fundamentally a risk-light model relative to many other banking activities.
A common question for institutions new to AMCs is: “Do we need our own structured products issuance capability to launch AMCs?” The answer today is no, even banks without an existing note issuance program or specific regulatory licenses can offer AMCs by leveraging external issuance vehicles. This is particularly relevant for mid-tier banks, wealth managers, and firms in jurisdictions where setting up a full-fledged issuance program is difficult or time-consuming.
The key lies in utilizing Special Purpose Vehicles (SPVs). These entities (often based in financial centers like Luxembourg, Switzerland, Liechtenstein, or Cayman) act as independent issuers for AMCs. They handle the legal issuance of the note, including having a base prospectus, obtaining any necessary regulatory approvals, listing on an exchange if needed, and segregating assets, while the strategy and distribution can be handled by the bank or asset manager. In other words, the SPV serves as an “Issuer-as-a-Service” for the bank’s product.
The result is a fully ring-fenced, bankruptcy-remote issuance on behalf of the bank, typically in a modular format (each AMC is a segregated compartment or series within the SPV, isolated from others). Investors who buy the AMC note are technically taking credit risk on the SPV (often with collateral or guarantees in place), not directly on the bank that originated the idea. This can also be advantageous if the bank is not very high-rated or if it wants to offload the issuance from its balance sheet.
For banks in regions like Asia or Africa that might not have local structured product laws or who lack a prospectus passporting regime, these third-party platforms are a godsend. For example, a number of Asian asset managers work with Luxembourg-based AMC issuers via orphan securitization structures to issue AMCs that are distributed in Asia. The notes are issued under EU law (often complying with EU Prospectus Regulation), but then offered to investors in, say, Hong Kong or the Middle East under private placement , thus leveraging a European SPV to reach global clients. The bank or manager in Asia effectively outsources the issuance mechanics to the Lux vehicle, while focusing on managing the assets and selling the product. The bank’s role is to bring the strategy and the investors, and perhaps act as arranger or distributor. In many cases, the platform will even handle or coordinate the market making for liquidity.
Importantly, using an external issuer does not diminish the bank’s branding or relationship with the client. It is very common for the AMC to carry the bank’s name or the strategy name, and the client interacts through the bank as usual. The SPV is a behind-the-scenes enabler. In some instances, a “white-label” arrangement is used: the AMC might be branded under the bank’s own program name, even though legally another vehicle issues it. This is analogous to white-label credit cards or funds sub-advised by another firm.
For executive decision-makers, this means time-to-market for launching an AMC platform can be very short. In Europe, many private banks that lack large structuring desks simply use a larger bank or an independent securitization firm to issue their AMCs. In Asia and the Middle East, we see an increasing trend of smaller institutions partnering with platforms to tap the AMC boom. The takeaway is clear: lack of in-house infrastructure is no longer a barrier. Any bank with investment ideas and client demand can feasibly launch AMCs through partnerships.
Speed-to-Market: The fast time to market of AMCs has been cited by issuers as a significant advantage for introducing new investment ideas.It allows issuers to be proactive rather than reactive, potentially shaping investor demand by being first to offer a novel strategy.
From an internal perspective, this speed also means product development cycles are shorter and cheaper. Teams can prototype an idea, launch a small AMC, see how it performs and how clients respond, and then iterate or scale up. It’s a very fintech-like approach to financial product innovation: lean and quick deployment, then refine.
Customization & Flexibility: Customization was discussed in the client context, but it’s worth noting the operational flexibility too. An AMC’s structure is extremely malleable: it can accommodate a wide range of asset types (public securities, loans, derivatives, funds, etc.), any currency, various fee models (performance fees, hurdle rates, or plain management fees). This is all baked into the note’s terms at inception.
This kind of flexible engineering allows mass customization without needing entirely new products for each variant. It’s a modular approach: one core strategy can spawn multiple tailored certificates. For the bank, this means one portfolio manager’s strategy (say a core equity long/short portfolio) can be distributed to different clients in different formats
Scalability & Automation: Scalability in AMCs comes from standardization and technology. Many banks utilize vestr’s dedicated AMC management platform that handle everything from order management, NAV calculations, fee accruals, to client reporting. Whether you're managing 5 AMCs with $10 million AUM each or 50 AMCs with $1 million AUM each, our technology keeps the operational workload minimal. The system handles most tasks automatically, whereas doing it manually would require 10x more effort for the same total AUM.. Once an AMC program is set, adding one more certificate does not require a whole new team or system; it’s often just a few additional data entries in the platform. This is how AMCs can scale to tens of thousands of underlying assets and numerous strategies without linear growth in complexity.
A concrete example of scalability is in trade execution: a bank’s trading desk can be executing orders for dozens of different AMCs in one day. The AMC platform typically generates the buy/sell tickets from each strategy rebalancing and feeds them to the trading desk. The desk executes (often via algorithms) and allocates fills back to each AMC’s account. This process can be highly automated. Thus, whether the manager is rebalancing $10 million or $1 billion, or doing it for 3 products or 30 products, the operational process remains efficient.
Finally, scalability in distribution is another facet: because AMCs are securities, they can piggyback on existing trading and custody infrastructure globally. A bank doesn’t need to build new distribution channels for a new AMC, it can be sold and held via the same broker and custodian networks as any stock or bond. Listing an AMC on an exchange immediately makes it accessible to any authorized market participant on that exchange. This is far easier than, say, getting a fund authorized for sale in multiple countries. The result is a scalable distribution model: one product, once listed or cleared, can be distributed across many regions (with appropriate selling restrictions noted in the prospectus).
Institutional Clients: For institutional investors (such as pension funds, insurance companies, asset managers, sovereign wealth funds), AMCs can serve as efficient vehicles for bespoke strategies or tactical allocations. Institutions often have specific mandates or require customized exposures that aren’t available off-the-shelf. Traditionally, they might use managed accounts or push for a segregated mandate in a fund. AMCs offer an alternative: the bank can package the exact strategy or asset mix the institution wants into a note form. The institution benefits by getting a custom solution with an ISIN, meaning it can be easily booked and valued by their systems (as a security holding), and potentially offers better liquidity than a managed account (since the AMC could be listed or market-made). For example, an institution might want a certain long/short strategy run by an external hedge fund manager, but with their own fee terms, the bank could issue an AMC referencing that manager’s portfolio, negotiate fees, and deliver a note that the institution buys. This saves the institution from setting up a complex derivative or fund on their own.
Another use-case in the institutional space is securitizing illiquid or non-traditional assets to fit into portfolios. If a bank’s investment banking arm structures a pool of loans or a basket of private equities, it could wrap those into an AMC and offer institutional investors exposure through a tradeable note. This is effectively a form of securitization via AMC. Unlike a static asset-backed security, however, if the manager actively services or rotates the pool (for instance, replacing loans that amortize with new loans), the AMC can continue to adapt. We see this in “actively managed securitization” deals for example, actively managed collateralized loan portfolios sold as certificates.
Institutional clients also appreciate the speed and trial-ability of AMCs. They can test a new asset manager or strategy by seeding an AMC (via a bank) with a smaller ticket, monitoring performance. If satisfied, they can add more. If not, the AMC can be wound down relatively easily at maturity or the client can sell in the market. This is simpler than dealing with fund lock-ups or SMA contracts.
High-Net-Worth and Retail Clients: At the other end, AMCs are extremely popular among HNWI clients served by private banks and wealth managers. These clients often desire unique investments (to differentiate from what they already have) and access to top-tier or niche managers. AMCs allow private banks to offer “fund-like” strategies without the client needing to meet hedge fund minimums or accreditation; the client just buys a certificate in their bank account.
For HNWIs, one big advantage of AMCs is consolidation and reporting. They can hold multiple AMC investments alongside stocks, bonds, etc., all in one portfolio statement with their bank. The bank takes care of the heavy lifting (since it’s the issuer’s responsibility to calculate the NAV and provide daily prices). This convenience means actively managed strategies become as easy to handle as holding an ETF or stock. Compare this to a HNWI investing in limited partnership hedge funds: those are separate, illiquid, and administratively more cumbersome. So private banks have a strong incentive to migrate some clients away from external funds into AMC-based solutions which the bank administers; it gives the bank more control and the client a smoother experience.
Exchange Listing and Public Distribution: We should also highlight that some AMCs are positioned for wider retail distribution by listing them on exchanges or offering them through public offerings (with the necessary prospectuses and disclosures). Many issuers see value in this because it broadens the investor base. A successful strategy might start as a private placement AMC for a few clients, then later be listed publicly to gather more assets from a wider audience, all without converting it into a formal fund. This two-stage lifecycle (private -> public) is unique to securitized products and can be advantageous.
Serving Family Offices and External Asset Managers: There’s a middle segment between institutions and pure retail: family offices and EAMs. These clients are sophisticated and often manage multiple underlying beneficiaries’ assets. AMCs are a boon for them as well: a family office can design a strategy (or pick a boutique manager’s strategy) and ask a bank to issue it as an AMC so that the entire family can invest in it through their respective accounts or entities. It effectively lets them create an investment vehicle without setting up an actual fund. External asset managers similarly can use a bank’s AMC to roll out strategies to all their advisory clients in a scalable way. Each client just buys the AMC in their own custodial account, replacing the need for the EAM to manage dozens of separate accounts in parallel
For a bank, having a product that can be tailored to all these segments is highly valuable. It means the infrastructure and effort to support AMCs is repaid by utility across your entire business: institutional banking, private banking, and even retail brokerage can all make use of the same AMC issuance capability. This cross-segment applicability is a strong argument in favor of developing an AMC program: it’s not a niche offering, but a versatile one that can enhance multiple lines of business.
Looking ahead, several key developments and opportunities can be anticipated:
Continued Global Expansion: We expect more banks in Asia and Africa to jump on the AMC bandwagon as success stories emerge. In Asia, the interest in Hong Kong and Singapore will likely encourage other financial centers (like Dubai, maybe Tokyo or Mumbai eventually) to clarify regulations to allow AMCs, seeing them as a tool to enhance market offerings. African markets beyond South Africa could explore AMC listings if their investor base demands more diverse strategies. Latin America is another region, wealth managers in places like Brazil or Middle East (like Saudi, Qatar) might use offshore AMCs to meet client needs until local avenues are available.
Integration with Wealth Management: AMCs could become a staple of wealth management advice. Rather than just picking funds and stocks, advisors might routinely package a bespoke solution as an AMC. This vertical integration (advice -> product -> execution) is an ongoing trend
Competition and Margin Pressure: As more issuers and platforms compete, there may be some compression in fees or at least more value-add required. Larger banks might leverage scale to undercut smaller issuers’ fees to attract external managers to their platform.
Regulatory Evolution: Regulators will continue to refine their stance. Regulators might issue more guidance if AMC volumes soar, possibly around marketing or risk disclosure. South Africa’s early move might serve as a model; other exchanges could adopt similar listing standards.
Product Innovation – Hybrids: We may see hybrid products that combine AMCs with other structures. For instance, a structured note (like an autocallable or option-based payoff) where the underlying is an AMC. This could give a structured payoff on a dynamically managed strategy.
Standardization and Secondary Market Growth: With time, if certain AMCs gather large AUM and public investor bases, they could trade more like quasi-ETFs in the secondary market. We might see more ratings agencies or independent research covering larger AMCs, making it easier for investors to assess them. Perhaps even index inclusion of some AMC (though since they are often unique, this is less likely). Another interesting angle is if exchanges introduce standardized segments or trading boards for AMCs, which could improve visibility.
Increased Collaboration between Banks and Asset Managers: The “AMC as a service” model will likely flourish
We anticipate more banks advertising their AMC issuance capabilities to external asset managers, family offices, and even fintech investment platforms. This could lead to a symbiotic relationship: banks provide the infrastructure and balance sheet trust, while asset managers bring investment talent and clientele. Essentially, banks could become platforms akin to cloud providers but for investment products. The network effect can make a bank’s platform more valuable, for e.g., if dozens of managers launch strategies on Bank X’s AMC platform, investors might gravitate to Bank X because it has the widest menu of strategies.
Education and Market Acceptance: Over time, as success stories pile up, any skepticism around AMCs will diminish. Education efforts by industry bodies (like Structured Products Associations) will continue to familiarize investors and regulators with the concept. The narrative is shifting from “Are these risky or unproven?” to “These are a well-established part of the toolkit.” If any high-profile failures occur (e.g., a strategy blow-up or fraud), it could cause a temporary setback or calls for tighter rules, but diversification of issuers and managers should mitigate systemic concerns.
Actively Managed Certificates have proven their value as a flexible, innovative, and high-growth product class that aligns well with the strategic objectives of banks and securitization providers. They allow financial institutions to marry the agility of active portfolio management with the efficiency of securitization, delivering benefits to both the provider and the end-investor. As we have detailed, AMCs enable rapid product development, new revenue streams, tailored client solutions, and scalable operations, all while fitting within existing regulatory frameworks when managed prudently.
For executive leadership evaluating AMCs, here are the key recommendations and takeaways:
In closing, Actively Managed Certificates represent a win-win proposition for banks and their clients. They deliver value to investors by providing access to bespoke, actively managed strategies in a convenient, liquid form. At the same time, they offer issuers a profitable, scalable business model with low capital strain. Banks and securitization providers in Europe, Asia, and Africa that have recognized these benefits are already reaping the rewards in terms of revenue growth, client satisfaction, and market positioning. By thoughtfully implementing an AMC offering, guided by the insights and best practices discussed, financial institutions can strengthen their competitive edge and open up new avenues for growth in the years to come.
