NZX & the Financial Markets Authority said yesterday they’d jointly initiated an industry-led review of New Zealand’s capital markets, called Capital Markets 2029. It’s intended to deliver a 10-year vision & growth agenda for the sector.
In a joint release, the 2 organisations said: “Capital Markets 2029 will consider the current framework & broader ecosystem of New Zealand’s capital markets and outline recommendations for the creation of wider, more active participation & increased diversity of product.
“New Zealand’s capital markets have performed well in a number of areas (such as KiwiSaver & debt issuance). However, equity listings have remained subdued and listed equity market is under-developed relative to global peers.”
S&P/NZX 50 companies generate over $24.6 billion in gross domestic product for the local economy and employ close to 10,000 New Zealanders: “Capital Markets 2029 aims to create a growth agenda which brings the capital markets ecosystem together to keep building on the active & vital contribution already being made by these companies.”
NZX chief executive Mark Peterson commented: “Healthy capital markets are essential for New Zealand’s economic growth. NZX has delivered some fundamental changes to the market over the past 15 months, such as increasing on-market liquidity and simplifying the markets structure & rule set – but we only play one part in New Zealand’s capital markets ecosystem. It is now important we bring the industry together to focus on accelerating the growth of our capital market.”
Financial Markets Authority chief executive Rob Everett commented: “This review responds to concerns expressed about the overall depth & breadth of our capital markets. From early-stage capital-raising & investment opportunities all the way up to main board listings & institutional investor appetite, we felt the time is right to plan for the future.”
Chair of the Capital Markets 2029 industry working group will be Martin Stearne, who’s had an extensive career in capital markets. He will be supported by accountancy firm EY, which has been engaged to help produce a report outlining findings & recommendations of the group, based on the working group’s findings, as well as its own research, analysis & insight of domestic & international trends. These will relate to agreed areas and may suggest outcomes for delivery by industry participants, regulators or Government.
As initiators of Capital Markets 2029, NZX & the Financial Markets Authority will jointly fund the initial costs. But they said that, depending on the costs for delivery, they might seek funding from industry. They intend to publish the findings of Capital Markets 2029 in the third quarter of this year.
Mr Stearne is a corporate consultant and a member of the NZX listing sub-committee & the investment committee of Impact Enterprise Fund. He was an investment banker with First NZ Capital Ltd & and its predecessors for 20 years, where his final role was equity capital markets managing director. He was recently appointed to the Takeovers Panel.
Attribution: Joint NZX-FMA release.