Michael Smith, CFA Debt Capital Markets, Winterflood comments on the opportunities for UK Bond Issuers from Regulatory Reform, following the Global Treasurer’s recent article, ‘Broader Access To The UK Bond Market Under The Microscope’.

The article summarises the imminent changes to the UK’s bond markets aimed at broadening access for retail investors, which should provide opportunities for issuers. It concludes that these will bring attractive opportunities for issuers from diversification of funding sources to better terms to lower issue costs.

Michael comments, "There will be no obligation for issuers to lower denomination sizes, so the benefits of doing so will have to add up - but the more we discuss it, the more compelling it is. We know about the demand that exists –we have made 3 gilt issues available to retail investors on platforms for the first time this year. Corporate bonds will be next.

“There has been over £1bn of corporate investment grade issuance in the last few weeks, all from strong brand names. All of these bonds would have caught a retail-bid in the primary and secondary too. Time will tell whether issuers take the opportunity to broaden access to their bonds following the reforms. The message to issuers is:  'Be prepared'”.

If you would like to discuss the article or topic in more detail, please contact: Michael Smith, CFA, Debt Capital Markets at Winterflood Securities