City heavyweights are planning to launch their ‘elevator pitch’ for UK capital markets in early July, according to people familiar with the situation.
The Capital Markets Industry Taskforce – a group that includes the London Stock Exchange’s Julia Hoggett, Schroders’ Peter Harrison, Latham & Watkins’ Mark Austin, Barclays’ Katharine Braddick and Phoenix’s Andy Briggs – is planning to produce a definitive summary of its work on how to rekindle London’s flagging capital markets.
The City has bled key floats to rival financial centres in recent months. Policymakers have tried to address a slumping listings market, which has fallen to its lowest level since the financial crisis, through a raft of reforms to areas such as the prospectus regime and investment research.
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CMIT’s report has been pushed back on several occasions, as other organisations ranging from the City of London Corporation to UK Finance and TheCityUK have also tried to come up with their own blueprints for reform.
The elevator pitch is set to point out various advantages of London’s markets, including how UK stocks have reached a near-record discount to US peers, an increasingly supportive political environment and a concentration of strong professional services skills.
The Financial Conduct Authority has drafted in external expertise to help its efforts to overhaul its rulebook, according to people familiar with the situation. Those working with the regulator on the project include Krishna Omkar, a former corporate lawyer at Magic Circle firm Slaughter and May and US powerhouse King & Spalding, according to people familiar with the situation.
An FCA consultation on new draft UK listing rules closed on 22 March.
This included plans to remove the current premium and standard listing segments and revamp how closed-ended investment funds and sovereign-controlled companies are treated “to encourage a more diverse range of companies to list and grow on UK markets”.
Galina Dimitrova, director of investment and capital markets at the Investment Association, said: “Overall, the new rules strike a good balance between reducing costs and complexities for issuers and encouraging high-quality companies to list and to do business in the UK, while also maintaining good standards of disclosures and transparency.”
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Capital markets gurus are hopeful British success stories such as business lender OakNorth, chaired by former Financial Services Authority boss Lord Adair Turner, could help give the City’s listings environment a much-needed boost.
As it released its latest financial results on 25 March, OakNorth told Financial News legal and financial advisers had not yet been appointed.
Klarna, Starling Bank and Zopa are among other big names that could potentially float.
Speaking at a FN roundtable in March, City minister Bim Afolami said he was not considering more drastic steps such as forcing pension providers to invest in UK stocks or giving the government a formal veto over regulatory decisions, known as a call-in power.
However, he said that he wanted to push the savings industry to move faster to support London’s markets.
“Pension funds get huge government subsidies through tax benefits. It is therefore legitimate for the government to say there is a public benefit that one needs to be providing as well as providing better returns for savers than they are returning at the moment,” he said.
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