The Association of British Insurers has unveiled plans to shake up the rules surrounding London’s listing requirements to protect the City’s reputation as a leading financial centre.
In its Encouraging Equity Investment report, the ABI argues for a number of changes to initial public offerings, listing requirements and broker and banker fees in order to improve the efficiency of equity markets and quality of companies floating in London.
Among the proposals are a stipulation for companies to have a minimum free float of 25 per cent, reductions to the size of bank syndicates that help companies raise money and encouragement for banks to show greater transparency of broking fees, the FT reports.
ABI director of investment Robert Hingley says: “Equity is the bedrock of economic growth and financing through capital markets plays a crucial role in the economy.
“Companies need equity to invest and grow and to generate the returns needed to service debt and other forms of capital. Investors want to see a flow of high-quality, well prepared and well-run companies coming to market.”
The association has spent four months speaking with institutional investors, investment bankers, lawyers, accountants, independent advisers, independent researchers and regulators on bolstering London’s reputation as a financial centre.
It says the recommendations in the report have the support of Government ministers and are likely to adopted by regulators or brought into law by the end of the current parliament in 2015.