Why were retail investors excluded from the Royal Mail stake sell-off?
12th June 2015
Following the Chancellor’s speech at the annual Mansion House dinner on Wednesday, the Government raised another £750 million off the back of its Royal Mail stake sell-off, and yet announced that it is planning to further sell £32bn of its assets in the Royal Bank of Scotland in the following months.
In response to this news, Andy Thompson, Director of Operational Policy and Research at the Wealth Management Association, comments: “The industry welcomes any effort from the Government to help minimise the UK’s public debt. Nonetheless, it remains a mystery to us why retail investors were excluded from participating in the initiative. Royal Mail shares should have been made available to everyone, but especially to retail investors as it is a retail-focused enterprise.
“In general, the retail investor community can provide much needed liquidity and offer loyalty to companies they invest in. The Government needs people that make responsible investments and look to the long-term future. In 2013 for instance, 690,000 individual investors benefited when the Government raised just under £2 billion from selling 60 per cent of Royal Mail, which shows this can be a positive move for the economy. Only 20 per cent of those investors sold their Royal Mail allocation within the first month of trading.
“Let us hope that when the time comes to sell off RBS Government assets, retail investors will be offered the same opportunities as big institutions. By doing so, the Government will be setting a really good example to corporate advisers. If retail investors are not to be included, those involved should be under an obligation to tell us why not.”
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Notes for Editors
About the Wealth Management Association (WMA)
- The Wealth Management Association (WMA) is a trade association representing 186 Wealth Management firms and Associate members
- 110 full members are wealth management and stockbroking firms that deal directly for over 4 million retail investors.
- They deal in stocks and shares and other financial instruments for individuals, trusts and charities through a range of services spanning execution only, advisory and discretionary fund management.
- 76 associate member firms provide professional services to our full member firms.
- WMA’s aim is to ensure that business, regulatory, tax and other relevant changes across Europe are appropriate and proportionate for the investment community and their clients.
- The WMA exists to support its members and their clients in the following ways:
- To be an advocate for the sector with governments, regulators and the wider financial services community;
- To influence policy and also decision makers within the wider sector to the benefit of WMA members and their clients;
- To research and provide definitive information about the sector as required for members and in support of the influencing and advocacy objectives;
- To be a thought leader, to lead and stimulate debate and make members aware of emerging trends; challenging and provoking change.
- Facilitating the sharing of good practice, enabling the membership as a whole to benefit from the latest developments affecting the sector as well as providing support to enable them to develop good prescribe and overcome challenges.
- Our member firms manage in excess of £670 billion of wealth in the UK, Ireland, Channel Islands and Isle of Man.
- The firms operate across more than 580 sites, employing over 32 000 staff.
- The firms also run over 5.5 million client portfolios and carry out over 20 million trades a year.
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