Capital Markets Corporate

February 12, 2021

Our Weekly Newsletter

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Across Instinctif Partners’ Financial Services team, we are always keeping an eye on the key developments taking place across the sector to evaluate their impact on the many businesses we work with. Here we share our picks of the week’s most interesting news, and our expert views.

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Overseas buyers drive sharp rise in dealmaking in UK 

The value of UK deals so far this year is already three times the total for the same period in 2020. The surge in dealmaking has been partly driven by overseas buyers raiding the UK market for assets that have experienced a sharp decrease in their value as a result of the pandemic. Depressed asset valuations are offering executives an opportunity to expand into new markets and boost growth at lower cost compared to pre-pandemic conditions. (From, Private Equity News 10 February 2021)

UK KPMG chair steps aside following Zoom outburst 

The chairman of KPMG UK is stepping aside following remarks he made to employees during a Zoom meeting in which he told them to “stop moaning” about the impact of Covid on their lives. The firm announced that Bill Michael would be leaving his post after an internal investigation. The probe was triggered by workers attributing controversial comments to Michael, in which he allegedly told workers in the company’s financial services division to “stop playing the victim card” and dismissed unconscious bias as “complete crap”. (From The Guardian, 10 February 2021)

Shift to green energy ‘could cost oil states $13 trillion’ by 2040 

Oil and gas producing countries face losing at least 40% of total government revenue according to a new report from think-tank Carbon Tracker. This equates to an estimated loss of $13 trillion by 2040, following efforts to contain the rise in global temperatures and cut back on fossil fuels. It is noted that some of the countries facing these severe losses are among the poorest, and the report calls for urgent diversification of government revenue and national economies. (From BBC, 11 February 2021)

Amsterdam ousts London as Europe’s top share trading hub 

Amsterdam surpassed London as Europe’s largest share trading centre last month as the Netherlands gained business lost by the UK since Brexit. According to data from CBOE Europe, the number of shares traded in Amsterdam has risen more than fourfold since December, reaching an average of €9.2bn compared to a drop in London’s shares to €8.6bn. This follows the ban on EU-based financial institutions trading in London because Brussels has not recognised UK exchanges and trading venues as having the same supervisory status as its own. (From Financial Times, 10tFebruary 2021)

Are active funds back in fashion?  

The Investment Association’s latest fund flow data has revealed that active funds welcomed £5.2bn worth of investment in December, with November seeing a record-breaking £5.4bn put into active funds. The resurgence of active funds follows an extended period when sales were being put under pressure by the rising popularity of tracker funds. Active funds are now outperforming passive funds, according to new research from wealth management firm Bowmore Wealth Group; actively-managed UK large-cap equity funds returned an average of 8.3 per cent over the past six months, compared with an average of 5.1 per cent for UK large-cap passive equity funds. (From Daily Mail, 9 February 2021)

 

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