Two and a half years on from the referendum and the UK is scheduled to leave the EU in fewer than 75 days. Details of our exit may still be uncertain, but the UK economy remains underpinned by innovation and a long standing international outlook – set to continue throughout 2019 and in the years to come.
London’s financial centre lies at the heart of this growth, supporting businesses in their efforts to raise capital. In this past year alone, London Stock Exchange facilitated the raising of £35bn in equity capital for 617 companies from around the world. The majority of this was by companies raising capital after their initial public offering. The continued confidence of investors in companies listed here supports long term economic growth and underlines London’s position as a leading global financial centre.
The last two years have seen the highest and third highest activity annually for London stock market listings since 2008. The diversity of the businesses reflect the UK’s position as a thriving community for enterprise. The 19 technology initial public offerings (IPOs) in 2018, represent a five year high, raising three times more than in 2017. These included the IPO of Czech cyber-security firm Avast’s, London’s fifth largest tech listing to date, Yorkshire-based video game company Team17, firmly cementing London’s position as a leading IPO centre for firms looking to expand internationally.
In fact it’s worth noting that 2018 saw more overseas companies list in London than at all other major European exchanges combined.
The UK has long enjoyed a position of being home to the world’s most international market, offering companies access to deep and liquid markets, and a sophisticated multi-jurisdictional and multi-currency global investor base. Three times as many international companies listed in London in 2018 than any other European exchange.
This year, we look forward to launching Shanghai-London Stock Connect – bringing together the world’s fastest growing capital market with the world’s most international - London. The initiative is ground-breaking, and builds upon London’s history of innovation. The past year saw landmark green bond issuances in London for the fastest growing major economies, India and China, as well as other key emerging economies as part of the UK’s vital role in addressing climate change. To date, over 90 green bonds have listed on London Stock Exchange.
Our AIM market, specifically designed for high growth companies, started in 1995 with just 10 companies worth £82m. Today AIM businesses are collectively worth £100bn, with the market having supported nearly 4,000 firms operating across the globe in more than 40 sectors.
2018 saw AIM raise £5.5bn for 396 companies, giving them access to public equity markets, offering long term patient capital to fund their growth. Companies joined AIM from across the UK, including from Huddersfield and Wakefield this year and, crucially, AIM provided nearly two-thirds of all growth market finance throughout Europe.
ELITE, our initiative to support companies to scale up, structure for growth and be more competitive in the global market place welcomed 380 companies from around the world in 2018. The global community of ELITE companies exceeds 1050 companies from 40 countries, across 40 sectors, with expansions into the Middle East, West Africa and Latin America in 2018.
To date, UK companies alone have raised over £1bn through ELITE, providing a key step on the funding ladder and helping
them to achieve their growth ambitions.
And it’s not just raising capital, but saving capital. LSEG’s leading global clearing house, LCH, had a record year in 2018 across its clearing services. SwapClear, LCH’s interest rate derivatives clearing service processed over $1 quadrillion in the course of the year, a new record and an increase of 23 per cent on 2017. Through SwapClear’s compression offering alone LCH saved customers an estimated $39.5bn in regulatory capital. London’s global liquidity pools continue to help make global markets more robust and more efficient.
2018 also saw the launch of LSEG’s series of reports on African capital markets, developed as part of its London Africa Advisory Group (LAAG). The five reports put forward recommendations on how African capital markets could be further developed to increase global investment flows.
They address a number of key topics for enabling funding for Africa’s infrastructure, addressing the challenges of climate change, supporting the continent’s SMEs and the continued development of domestic capital markets.
Looking ahead, LSEG will launch the second edition of its report Companies to Inspire Africa next week. The report will showcase and celebrate the achievements high growth small- and medium-
sized companies across the continent, shedding light on inspirational stories of entrepreneurship.
Whatever the coming year brings, we at London Stock Exchange Group remain committed to promoting and providing access to finance for companies and economies throughout the world as we have done for more than 300 years.