Deutsche Bank survey finds confidence returning to London’s capital markets

Deutsche Bank today published its fourth annual Raised in London report, finding that confidence in London’s capital markets has strengthened markedly despite continued geopolitical and economic uncertainty. Based on a survey of 150 directors and senior leaders at UK-listed companies, the report highlights renewed optimism about the UK’s attractiveness as a destination for capital, investment and growth.  
 
Alison Harding-Jones, Co-Head of the Investment Bank and Global Head of Investment Banking and Capital Markets at Deutsche Bank, said: "The most striking feature of this year's survey is the breadth of the improvement in sentiment. Business leaders expect stronger IPO activity, increased fundraising, greater M&A activity and more supportive financing conditions. That reflects growing confidence in both the UK economy and London's capital markets. The opportunity now is to convert that confidence into investment, helping companies access the capital they need to grow, innovate and create jobs." 
 
James Taylor, Head of UK Investment Banking at Deutsche Bank, said "London remains one of the world's leading financial centres, supported by deep pools of expertise, a strong legal and regulatory framework and a global investor base. Our findings suggest companies are increasingly optimistic about the UK's prospects and London's ability to compete internationally. Maintaining that momentum will require continued focus on attracting capital, improving liquidity and ensuring the market remains an attractive place for businesses at every stage of their growth journey." 
 
Vathany Vijayaratna, CEO of Deutsche Bank in the UK and Ireland, said: "Boards are becoming more positive about the outlook for UK-listed companies and the opportunities available through the public markets. The survey shows strong support for reforms that strengthen domestic investment and improve access to growth capital. While challenges remain around valuations and liquidity, there is a clear belief that London can build on its strengths and enhance its position as a destination for ambitious companies seeking long-term capital." 
 
The research found that 87% of respondents believe the appeal of the UK as a capital market and investment destination has increased over the past 12 months, while 97% agree the UK is an attractive market for launching an IPO or raising capital. Respondents also expect a recovery in market activity, with 94% predicting London’s competitiveness in IPOs and fundraising will improve over the next three years and 94% expecting UK IPO volumes to increase over the next 24 months.  
 
The findings suggest that recent reforms and a more resilient economic backdrop are helping to improve sentiment towards London’s markets. At the same time, respondents identified a number of areas where further progress is needed, including increasing domestic investment, improving valuations and deepening liquidity. The report also points to growing confidence in the wider UK economy. Ninety per cent of respondents said they were more confident about the UK's growth prospects than they were two years ago, while 95% believe the Government’s industrial and financial services growth strategies have improved the UK’s investment appeal.  
 
Corporate activity is also expected to strengthen. Eighty-seven per cent of respondents anticipate increased UK M&A activity over the next year, while 90% say their organisation is somewhat or highly likely to undertake an acquisition. In addition, 88% expect private equity acquisitions of UK-listed companies to increase and 93% have seen improvements in debt pricing or financing availability.  
 
The report concludes that while London's outlook is improving, sustained success will depend on further efforts to mobilise long-term domestic capital, support high-growth companies, continue regulatory reform and strengthen the UK’s attractiveness as a venue for listings and investment.  
 
150 board directors and senior leaders from UK-listed companies were interviewed for the survey, including chairs, chief executive officers, chief financial officers, heads of investor relations and senior independent directors. The survey included respondents from FTSE 100, FTSE 250, AIM and other UK-listed companies.