Last month, FSA retail policy director Dan Waters pledged to investigate “purported regulatory blockages” stopping investors or advisers knowing counterparties. The regulator has now gone further, saying: “We know some firms think there are regulatory blockages that stop investors or their advisers knowing which institution or institutions have issued the debt that makes up the capital protected element of a particular product. However, we are not convinced.”
It says it “does not accept there are necessarily regulatory blockages” and will be asking firms to explain the requirements that they believe prevent disclosure.
Keydata Investment Services director of sales and strategy Mark Owen says disclosure hinges on whether the underlying institution has a note listing programme allowing their name to be used. He says: “More investment banks will enable their name to be used because they have gone through the rigmarole to make sure their listing documents allow them to do this. The more a company says its name cannot be disclosed, the more it is not going to be chosen to back assets.”
Lowes Financial Management managing director Ian Lowes says: “Firms have not named the issuer because they believe there is a definite regulatory blockage or concern that by naming it they may get accused of creating a false sense of security.”