Introduction: Focus on the USA

The US has long been viewed as the holy grail for structured products professionals. And if the upbeat mood of last month's Structured Products Association (SPA) meeting is anything to go by, structurers and distributors in the country could be on to a winner.

Companies like Florida-based Countrywide Financial believe investors are warming to the industry and are preparing themselves to be in a leading position when demand rises. Similarly, regional powerhouses like California's Wells Fargo are looking to make the most of their impressive distribution networks.

Growth of the market could also be aided by some impending regulatory changes. Speaking at the SPA event, a number of lawyers said they expect wide-ranging reform proposals that will affect the way structured products issued as securities are communicated to clients and regulators. The changes, which will affect the 'shelf' registration process, will mostly change the nature of MTN programmes and unlisted notes registered with the US Securities & Exchange Commission.

Effectively, the anticipated reforms will include a new category of provider – the WKSI (the well-known seasoned issuer), essentially large investment banks with large note programmes. WKSIs will have no SEC review process and will be able to make use of subsidiaries to provide guarantees.

It could be an exciting development, but, as some lawyers correctly point out, more than a few filing issues remain to be resolved.

Paul Lyon