Nikou Asgari’s deep dive into Stockholm’s capital markets (Report, April 19) rightly highlights how Sweden’s engaged retail and institutional investor base supports a continuous “funding escalator”, as companies move from privately held through to SME growth markets and ultimately main market IPOs.
While recognising the differences between our capital markets, the Swedish experience may still hold a few lessons for the UK.
The machinery driving the Swedish escalator includes a progressive companies’ law framework comprising a single digital share register and hybrid direct-indirect holding model for shares. This highly digitised environment not only reduces pain points for issuers and intermediaries, it also offers the possibility of transparency around beneficial ownership that empowers retail investors to participate in corporate actions, like secondary capital raises, in a way they often cannot (yet) in the UK.
Private Swedish companies often elect to enter the digitised market infrastructure well before any prospect of joining public markets, a factor contributing to the continuity of our funding escalator — and a point for the UK financial sector to bear in mind, as secondary markets for private shares look set to play a greater role in equity intermediation under UK government proposals for a new type of intermittent trading venue.
Thank you for a very insightful article, and we here at Euroclear Group have a sincere ambition and are deeply engaged in bettering all the financial markets we support.
Roger T Storm
Chief Executive Officer, Euroclear Sweden, Stockholm, Sweden
