Minister backs risk-taking as infrastructure fund launches
THE City minister has insisted that he supports risk-taking in the Square Mile amid fears that London is losing its appeal as a financial centre.
In an apparent response to claims by the boss of Schroders that Britain failed to back risk takers, Andrew Griffith used a speech yesterday to praise financial services companies.
He said: “Thank you for taking risk, employing and developing your people and the valued contribution you make.
“I never forget that you have a choice where to locate or to raise or invest capital. Because it’s a competitive world out there and the UK must and will compete for every pound, dollar or euro of business. And it’s my job to make sure we put in place the support environment in which you can do so.”
Last week, Peter Harrison, chief executive of Schroders, said Britain’s failure to back “risk takers” meant London was unable to compete with New York.
The comments followed British tech darling Arm’s decision to snub the London stock market for a blockbuster listing in New York, a move that triggered concern about the future of the City.
The Government has brought in a top City lawyer to tackle London’s competitiveness issues. Rachel Kent, a senior partner at Hogan Lovells, has been appointed to lead a review into investment research and establish why Britain is lagging America in key industries such as tech and science.
Ms Kent’s review is the third investigation into the City’s competitiveness in as many years, following a report on listings by Lord Hill and an investigation into the fintech sector by Ron Kalifa.
Yesterday, Schroders became the first company to launch a UK long-term asset fund (LTAF) in an effort to boost spending on infrastructure.
The FTSE 100 fund manager was granted permission by the Financial Conduct Authority (FCA) to establish an LTAF, which is an investment vehicle designed to allow investors to back long-term illiquid assets. The FCA relaxed rules governing LTAFS in 2021.
Mr Harrison said: “We feel strongly that a wider range of UK savers must be able to take advantage of the robust returns and diversification benefits that investing in private assets can bring.”