Commending the new Government’s “commitment to UK capital markets”, AFME has shared three key principles that it believes will create “deep, integrated and sustainable” markets that support both companies and investors.
The association calls on the Government to provide a clear roadmap on capital market reforms, including a structured timeline for the completion of work under the smarter regulatory framework.
Regulators should remain independent within their mandates and retain the ability to react to market developments in a timely manner when justified, AFME continued. This is particularly relevant given current concerns in the US that the Federal Reserve may lose its independence under a second Trump presidency.
High regulatory standards and a stable, independent regulatory regime are key for the UK’s reputation and success as a global financial centre, the association argued, and should be both tailored to the domestic market and have the ability to meet changing needs and international standards.
International competitiveness needs to remain a focus, it added, stating its support for the international competitiveness and economic growth objective outlined in the Financial Services Market Act. Regulators’ policy decisions need to prove their commitment to this objective, it said, adding that competitiveness is improved by having a well-functioning financial services ecosystem rather than a low-regulation environment.
Adam Farkas, CEO of AFME, stated: “On behalf of our members, I want to extend our sincerest congratulations to the ministers on their appointments. We look forward to working with them and their colleagues to secure the UK’s long-term economic prosperity and competitive advantage.
“We strongly believe that UK regulation should keep-pace with global changes in regulation, to ensure the UK does not diverge from other major overseas jurisdictions, or international standards and best practice. Changes to the regulatory landscape should be considered alongside the effect that they will have on the UK’s competitiveness compared to other jurisdictions. A consistent international level playing field and the prevention of both excessive regulation and the fragmentation of capital across different jurisdictions are vital to cross-border banks and their client base who benefit from open, liquid and transparent global financial markets.”
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