IF the City has a collective mood, it is safe to say it has not been an overly cheery one in recent times. At a recent private dinner of CEOs, to which I was kindly invited to join, the overarching theme was a nervousness that London is wobbling a little, at least when it comes to capital raising.
Public comments by Sir Nigel Wilson this weekend – that UK financial services had “fallen back a bit” – adds to the grumbling.
Into this mix, though, came a rather unexpected vote of confidence in the capital.
Deutsche Bank’s £410m purchase of Numis, the small and mid-cap broker, certainly raised my eyebrow. With London’s IPO market rather thin currently, why is the German giant picking up a firm which specialises in raising equity capital? Well, to listen to Deutsche, it’s because they’d still rather expand their presence in London than anywhere else in Europe, describing it as still the pre-eminent hub on this side of the Atlantic. It certainly marked a change from what appeared a largely consolidatory tie-up between Finncap and Cenkos.
The question now for London is how we close the gap on New York, and indeed keep Singapore at bay.
The Chancellor’s Edinburgh Reforms will no doubt help, with the changes to Solvency II the most eye-catching. The nature of economic cycles too suggests that the capital will not remain too long in the doldrums.
But – reversing the old adage that death occurs by a thousand cuts – it will be the smaller, perhaps less headline-grabbing moves that give the capital’s firms a boost.
Luckily, there’s plenty of ideas – in the past four years the government has commissioned and received reviews into listing rules, capital markets and the future of the fintech industry. It would be welcome if the reviews conducted by Mssrs Hill, Austin and Kalifa turn into concrete changes – rather than gathering dust on the shelves of Treasury civil servants.
Back to work – the German way
One of the barriers to office workers returning to the City more than three times a week is the cost of commuting. Perhaps the government could look to the continent, where Germany has just introduced a monthly €49 train pass, valid for unlimited travel on all services. It’s a costly subsidy but with the economy powered by cities, it’s likely to be an investment that pays off if it leads to higher footfall. The Germans don’t always do it better, but they’ve nailed this.
Back office, back-burner
Last week, speaking on a panel at an event for recruiters in the City, I was asked a question about the impact artificial intelligence might have on journalism. It’s a fair question and one whose answer will likely come in the passage of time. But perhaps the question should be flipped back on those asking. With a range of clerical jobs potentially on the block as the technology improves, recruitment firms specialising in back-office roles may have to do some thinking, too.
Can I quote you on that?
We have cut CO2 emissions by 40 per cent since 2010Tory chairman Greg Hands on the party’s green credentials. Fair enough: it’s quite the achievement.
Eating our way to the top table
One often ponders what the biggest risks to London’s economic future might be. A slow IPO market? New York’s ability to raise capital for growing firms? No doubt they’re issues but I’m always inclined to think the answer is maintaining the capital’s extraordinary talent base. Vital to that is our hospitality industry, and indeed, London’s vibrant cultural life more generally; nobody truly wants to live in Frankfurt, after all. So, in no particular order, a list of the new-ish restaurants I’ve been to in the last couple of months that will ensure the best and brightest still want to live here: Italian Brutto in Farringdon, Mexican-inspired Zapote in Shoreditch, Okko on Broadway Market for ramen, and Sons and Daughters in Borough for exceptional sandwiches.