1. INTRODUCTION
The purpose of this FINSA Client Information Document is to inform the client (“You”) about how radicant bank ag, (“radicant” or “we”) applies certain requirements of the Federal Act on Financial Services (FinSA) entered into force on 1 January 2020.
The primary aims of FinSA include strengthening investor protection and providing more transparency on financial instruments.
This document includes general information, such as the regulatory licence status, the available investment services, suitability and appropriateness, client classification, best execution, conflicts of interest, compensation from third parties, general risks, and complaints handling.
2. CONTACT AND REGULATOR
radicant is authorised and regulated by the Swiss Financial Market Supervisory Authority (FINMA) and is licensed as a bank.
radicant may therefore provide the full range of banking and wealth management services, including Investment Management Mandates and Investment Advice, as well as the purchase, sale and safekeeping of securities and other financial instruments.
Contact details:
radicant bank ag
Mühlebachstrasse 162-164
CH-8008 Zürich
Switzerland
www.radicant.com
Swiss Financial Market Supervisory Authority FINMA
Laupenstrasse 27
CH-3003 Bern
Switzerland
Phone: +41 31 327 91 00
Email: info@finma.ch
Website: www.finma.ch
3. RADICANT’S FINANCIAL SERVICES
radicant provides the following financial services that fall within the scope of FinSA:
- Investment Management Mandates;
- Investment Advice;
- Execution-only.
4. RADICANT’S INVESTMENT UNIVERSE
radicant can only provide buy recommendations on financial instruments that are documented in radicant’s investment universe (e.g., shares, funds, ETFs, bonds, structured products, derivatives) issued by the Sustainable Investment Office. The investment universe entails an assessment on whether the included financial instruments are suitable for retail clients and whether they are in line with radicant’s mission to support the achievement of the 17 UN Sustainable Development Goals (SDGs). For radicant issued products a comparable eligibility assessment must be performed and documented.
When selecting financial instruments, radicant relies on trustworthy sources of information.
5. INFORMATION ON CLIENT CLASSIFICATION
According to FinSA, all financial services providers are required to assign You one of the following three client classifications, each of them associated with a different level of protection:
- Retail clients: have the highest level of protection;
- Professional clients: benefit from a lower level of protection than retail clients. Based on their level of knowledge and experience and their potential to withstand financial losses. Fewer obligations are established for financial services providers to comply with;
- Institutional clients: have the lowest level of protection. Most of the obligations under the Financial Services Act are not applicable.
radicant treats all its clients as retail clients and does not provide financial services to professional or institutional clients. radicant therefore ensures the highest level of protection and compliance with its obligations under FinSA.
6. REQUEST TO CHANGE SEGMENTATION (OPTING-IN)
FinSA offers options for changing the client classification by opting-in, respectively opting-out. Such change of classification would result in a change in the level of client protection and as consequent change in the duties of financial service providers.
Opting-in or opting-out is excluded for all financial services provided by radicant.
7. RETAIL CLIENT STATUS
By being classified as a retail client, You benefit from the highest level of investor protection.
Before a service can be provided or a transaction can be carried out, financial service providers must provide comprehensive information on the risk associated with the product, for example via a key information document (KID).
According to FinSA, radicant does not provide a KID if the financial service is provided solely for the execution or transmission of client orders (Execution-only) unless a KID has already been produced for the financial instrument in question. In addition, radicant does not provide a KID for financial instruments that are acquired for retail clients under an Investment Management Mandate.
The range of financial instruments available to retail clients is generally limited to products designed for or specifically authorised for distribution to this category of clients.
8. RETAIL CLIENT CLASSIFIED AS QUALIFIED INVESTOR
According to Art. 10 (3) of Collective Investment Schemes Act (CISA), retail clients are classified as qualified investors for whom a financial intermediary performs discretionary investment management or investment advice as part of a mandate that is created on a permanent basis.
As a qualified investor, You have access to investment instruments or unit classes of investment instruments which are exclusively open to qualified investors within the meaning of the CISA. These investment instruments may be exempt from certain investor protection regulations.
In case You do not want to be considered a qualified investor, radicant reserves the right to terminate the Investment Management Mandate/Investment Advice agreement because the services provided are intended for qualified investors.
9. APPROPRIATENESS AND SUITABILITY ASSESSMENTS
radicant performs Your risk profiling electronically through the radicant app and assesses whether the recommended individual investment strategy and the individual financial instruments are suitable for You before providing investment management services (Investment Advice or Investment Management Mandates).
radicant validates through the appropriateness assessment that You have the required knowledge and experience to adequately understand the nature and risk involved in the financial service or financial instrument offered, and that You are able to bear any related financial risk.
An appropriateness and suitability assessment is not performed for Execution-only.
10. CLIENT RISK PROFILE
radicant is obliged to assess the suitability of its services in relation to Your risk profile, in doing so, radicant must obtain information on Your financial situation, considering the nature and amount of Your regular income, current and future assets and financial commitments, as well as Your investment objectives.
To enable radicant to collect the information required, You must provide, through the online onboarding process, within the radicant app, the following information:
- financial situation, including financial risk ability and risk tolerance;
- investment objectives, including investment time horizon; and
- knowledge and experience, where required.
radicant will rely on the information provided by You.
You must update the information via the radicant app in the event of changes in Your financial or personal situation. In the event of changes, radicant adjusts Your risk profile and, where applicable, recommends a new investment strategy suited to Your current situation.
11. SUITABILITY WITHIN DISCRETIONARY MANDAT
An Investment Management Mandate is a suitable investment solution offered by radicant for investors who wish to delegate the investment decisions concerning their assets to radicant.
Under a Discretionary Mandate, You delegate the investment decision to radicant who has complete discretion to act, realise or otherwise manage the investments in Your portfolio in accordance with the agreed investment strategy. You allow radicant to carry out any transactions it deems necessary to achieve the selected investment strategy whereby radicant acts in line with the Portfolio Management Guidelines of the Swiss Bankers Association, its internal asset allocation policy, the applicable investment strategy and any instructions given by You.
12. SUITABILITY OF INVESTMENT STRATEGY
Based on the information You provided within the radicant app, radicant determines a score that matches Your corresponding risk profile to recommend a suitable investment strategy.
You are entitled to choose an investment strategy that deviates from Your risk profile. Should this occur, a higher risk may have to be assumed.
13. SUITABILITY OR APPROPRIATENESS WITHIN INVESTMENT ADVICE
Investment Advice means the provision of personal recommendations to You, either upon Your request or at the initiative of radicant, in respect of one or more transactions relating to financial instruments or a specific investment service.
Under Investment Advice radicant provides personal recommendations on transactions with financial instruments. FinSA differentiates two types of investment advice:
- Investment Advice for individual transactions without considering Your entire portfolio ("transaction-related investment advice") and
- Investment Advice considering Your portfolio ("portfolio-related investment advice").
Each requiring a different approach in terms of assessing appropriateness and suitability.
14. APPROPRIATENESS WITHIN TRANSACTION-RELATED INVESTMENT ADVICE
radicant performs an appropriateness assessment when it provides Investment Advice on individual transactions without considering Your portfolio. radicant enquiries Your knowledge and experience relating to individual financial instruments and assesses whether such financial instruments are appropriate before recommending them.
15. SUITABILITY WITHIN PORTFOLIO-RELATED INVESTMENT ADVICE
radicant performs a suitability assessment when providing Investment Advice considering Your portfolio. radicant enquiries about Your investment objectives, financial situation, as well as knowledge and experience related to a specific financial service, rather than an individual financial instrument, transaction respectively.
16. NO APPROPRIATENESS OR SUITABILITY CHECK WITHIN EXECUTION ONLY
Execution-only involves the pure intermediation of transactions in financial instruments by radicant.
Under the investment service of Execution-only, radicant merely executes the orders given by You to purchase or dispose financial instruments, without providing any prior advice.
When using Execution-only services, You do not benefit from radicant’s investment expertise. radicant does not provide any support in Your investment decisions or portfolio management.
Within Execution-only transactions, radicant does not perform appropriateness or suitability assessments.
17. BEST EXECUTION FRAMEWORK
Best execution is the obligation to take all appropriate measures to achieve the best possible result for You on a consistent basis when executing transactions on Your behalf, considering:
- Price - the price a financial instrument is executed at.
- Costs - costs related to execution, included all expenses incurred by You which are directly relating to the execution of the order, including execution venue fees, clearing and settlement fees and any other fees paid to third parties involved in the execution of the order.
- Speed - this is the time it takes to execute Your transaction.
• Likelihood of execution settlement - this is the likelihood that radicant will be able to complete Your transaction. - Size - the size of the transaction executed for You, accounting for how this affects the price of execution.
- Nature – nature of the transaction or any other consideration relevant to the execution of the transaction.
radicant ensures that the execution of Your orders achieves the best possible result in terms of financial, time, and quality.
In financial terms, radicant considers not only the price of the financial instrument but also the costs associated with the execution of the order and the compensation of third parties.
18. CONFLICT OF INTERESTS
radicant has implemented organizational measures to identify, prevent, mitigate and monitor conflicts of interest that could arise through the provision of financial services or result in any disadvantages for You or for radicant.
If disadvantages for You cannot be excluded, the conflict shall be disclosed to You. You shall be informed of the circumstances behind the conflict of interest, the resultant risk for You and the precautions taken by radicant to reduce the risks.
19. INFORMATION ON FEES
Information on the actual costs and fee of the available financial services provided by radicant is disclosed in the radicant app and on the website www.radicant.com. The fees might be updated at any time. Changes will be duly notified to You.
20. COMPENSATION OF THIRD PARTY
Compensation is defined as payments from third parties accruing to the financial services provider in association with the provision of a financial service, such as brokerage fees, commissions, discounts or other financial benefits.
FinSA strictly regulates the receipt and payment of compensations as they can lead to potential conflicts of interest. You must therefore be adequately informed of the existence of such compensation.
In connection with the provision of financial services (e.g., based on distribution or other agreement with third parties) radicant may receive brokerage fees, commissions, discount or other pecuniary benefit (third-party compensation).
radicant transfers third-party compensation in full to You.
21. GENERAL RISK OF FINANCIAL INSTRUMENTS
Investments in financial instruments involve opportunities but also bear risks. It is important that You understand the risks of the financial instrument You are investing in.
The brochure “Risks Involved in Trading Financial Instruments” of the Swiss Bankers Association contains general information on typical financial services and on the characteristics and risks of financial instruments.
The brochure “Risks Involved in Trading Financial Instruments” will be provided to You within the radicant app and on www.radicant.com. The document can be downloaded at any time.
22. INFORMATION ON FINANCIAL INSTRUMENTS
For many financial instruments, the respective Key Information Documents (KIDs) are available. KIDs contain information on the characteristics of the respective products, as well as their risks and costs.
According to FinSA, radicant does not provide a KID if the financial service is provided solely for the execution or transmission of client orders (Execution-only). radicant does not provide a KID for financial instruments that are acquired for retail clients under an Investment Management Mandate.
23. COMPLAINTS MANAGEMENT/MEDIATION PROCEDURE
radicant appreciates Your feedback and takes every comment and complaint seriously.
Should You not be happy with radicant’s services, You should send an email to complaints@radicant.com.
radicant handles all requests and complaints in line with its regulatory obligations and internal procedures and will endeavour to process and respond to complaints as quickly as possible.
If You are not satisfied with the way Your request has been handled by radicant, You may contact FINOS Ombudsman, which is a neutral information and mediation institution that radicant is affiliated with.
The contact details of FINOS Ombudsman are the following:
Finanzombudsstelle Schweiz (FINOS)
Talstrasse 20
CH-8001 Zurich
Switzerland
Phone: +41 44 552 08 00
E-Mail: info@finos.ch
Website: www.finos.ch
Disclaimer
This FinSA Client Information document is provided to radicant’s clients for information purposes and regulatory reason only. This document is not marketing material.
radicant does not accept liability for the accuracy, adequacy, completeness, or correctness of the content of this document as specific details may be amended after its on
20/10/2022 Zurich CH