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Govt looks to extend Isa retail bond scope

The Government is looking to extend the range of retail bonds which can be held within stocks and shares Isas.

In last week’s Autumn Statement, the Government announced it was considering allowing retail bonds to be held in stocks and shares Isa which have a maturity term of less than five years.

The statement says: “The Government is exploring whether to increase the number of retail bonds eligible for stocks and shares Isas by reducing the requirement that such securities must have a remaining maturity above five years.”

Bestinvest business development managing director Jason Hollands praises the move.

He says: “The announcement the Government is considering easing the rules which currently require such securities to have a remaining maturity above five years is a nod to the rapidly expanding retail bond industry.”

The Autumn Statement also sets out the Government will publish a discussion paper on enhancing equity financing in the UK.

It says this includes options to improve access to public equity markets for UK businesses and retail investors.

The retail bond market has grown since the launch of the London Stock Exchange’s Order Book for Retail Bonds in February 2010.

Retail bonds are not protected by the Financial Services Compensation Scheme.

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