EQS-Adhoc

Press release: Fitch revises Leonteq's outlook to Positive

EQS Group-Ad-hoc: Leonteq AG / Key word(s): Rating Press release: Fitch revises Leonteq's outlook to Positive 02-Nov-2021 / 07:00 CET/CEST Release of an ad hoc announcement pursuant to Art. 53 LR The issuer is solely responsible for the content of this announcement. PRESS RELEASE | FITCH REVISES LEONTEQ'S OUTLOOK TO POSITIVE

Zurich, 2 November 2021 | Ad hoc announcement pursuant to Art. 53 LR

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.