Plans to boost retail investors' access to Britain's corporate bond market risk falling flat under the City watchdog's current approach, Barclays has warned. The Financial Conduct Authority has been introducing a series of initiatives designed to make it more attractive for companies to issue bonds to everyday investors, giving firms access to another funding route and providing savers with a relatively low-risk and high yielding asset class.
FCA chief executive Nikhil Rathi said in May that 'broader individual participation in our capital markets' should 'build stronger understanding of the importance of sensible risk-taking to grow our economy'. The regulator is expected to publish a consultation in the first quarter of this year addressing some of the challenges, and potentially streamlining the issuance process and improving information accessibility for retail investors.
But research published by Barclays suggests the FCA's current approach will not 'have a significant impact on the availability of corporate bonds for UK retail investors'. The bank's analysis of all bonds in issue as of March 2022 found that just eight additional issuers would qualify for issuing bonds to UK retail investors under the watchdog's planned changes.
Widening participation: The FCA is expected to publish a consultation addressing some of the challenges facing plans to open up access to Britain's corporate bond market. It said: 'A similar picture emerged from our insights into historic investor demand.
