Yearbook 2014 Perspectives on the Global Markets
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Yearbook 2014 Perspectives on the global markets Supporting Talking Settlement, the new wave Turquoise the next frontier Page 24 Page 42 Page 68 ONE PLACE DIVERSIFYING Qatar. Where growth and diversification go hand in hand. Thanks to its world class regulation and a secure and transparent rule of law, the QFC has helped Qatar to become the region’s most dynamic economy, and its perfect access point. The QFC can help you be a part of it. Benefit from the lowest tax in the world,* 100% ownership, repatriation of all profits and an onshore trading environment. Join us. www.qfc.com.qa BUSINESS ENERGY LONDON STOCK EXCHANGE GROUP EDITORIAL BOARD Marketing Director Guy Brindle Senior Press Officer Tom Gilbert Marketing Manager Lauren Crawley-Moore BARKER BROOKS COMMUNICATIONS LTD Editor Joanne Hart Creative Services Director Evan Jeffries Head of Design Catherine Perry Sales Director Victoria Johnson Sales Executives Alex Gray Tom Grant Chairman Les Charneca ISBN 978-1-906940-63-8 Printed by Buxton Press Published by BarkerBrooks Trusted media partners www.barkerbrooks.co.uk Barker Brooks Communications Ltd 9 Cardale Court, Cardale Park Harrogate HG3 1RY Tel: 01423 851 150 An official publication of London Stock Exchange Group London Stock Exchange Group plc 10 Paternoster Square, London, EC4M 7LS ©2014. By making this communication, none of London Stock Exchange Group plc and/or its group undertakings (which shall be construed in accordance with section 1161 of the Companies Act 2006) (“LSEG”), Barker Brooks Communications Ltd (“Barker Brooks”), or the individual authors intend to invite or induce you to engage in any investment activity for the purposes of the UK regulatory regime (other than, where relevant, in respect of the London Stock Exchange plc’s exempt activities of operating UK regulated investment exchanges and providing clearing services in the UK). This publication does not constitute an offer to buy or sell, or a solicitation of an offer to sell, any securities, or the solicitation of a proxy, by any person in any jurisdiction in which such an offer or solicitation is not authorised, or in which the person making such an offer or solicitation is not qualified to do so, or to any person to whom it is unlawful to make such an offer or solicitation. 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FTSE is a registered trade mark of subsidiaries of London Stock Exchange Group plc and is used by FTSE International Limited under licence. Other logos, organisations and company names referred to may be the trade marks of their respective owners. No part of these trademarks, or any other trademark owned by LSEG can be used, reproduced or transmitted in any form without express written consent by the owner of the trademark. 4 Foreword London Stock Exchange Group plc Yearbook 2014 As our evolution “continues, so our core functions – facilitating the raising and allocation of capital, matching buyers with sellers, and providing access to funding – remain evergreen. Chris Gibson-Smith Chairman London Stock Exchange Group plc Yearbook 2014 Foreword 5 Section 1 Overview Foreword Raising Finance Raising WELCOME TO LONDON STOCK EXCHANGE GROUP’S ANNUAL Section 2 YEARBOOK. THE LAST FEW YEARS HAVE SEEN A RAPID EVOLUTION OF THE GROUP, BUT I’M STRUCK, READING THIS YEAR’S BOOK, HOW DEEPLY TRANSFORMATIVE THIS PROCESS HAS BEEN. WE ARE TODAY AN INTERNATIONAL, MULTI-ASSET, MULTI- PLATFORM BUSINESS; A LONG WAY FROM OUR NOT-SO-DISTANT on our Markets Trading ROLE AS A STANDALONE UK EQUITIES EXCHANGE. Section 3 he most notable recent development has green shoots in the IPO market, in Italy as well as been the acquisition of a majority stake in the UK, are plainly in evidence. T LCH. Clearnet, a leading global clearing house, which completed in May 2013 with the overwhelming Nowhere is that truer than amongst Small and support of both sets of shareholders. The strategic Medium Sized Enterprises (SMEs). Supporting rationale for this partnership is clear, and delivers the long term development of the whole funding many of our goals, but most specifically that of ecosystem, particularly for SMEs, remains a passion developing our post trade business. The transaction for us and is a central tenet of our corporate is a key step towards securing the Group’s long responsibility approach. It is our deeply held term role in the operation of international capital conviction that only when smaller, fast-growing markets and delivers opportunities for further global businesses can efficiently access equity finance Section 4 Post Trade Post expansion, particularly in the United States and Asia. – private and public – as the means to fuel their growth, will we see sustained economic prosperity. The traditional notion of the Group as a domestic Our commitment to this cause is evidenced by UK equities business is now truly outdated. The the package of programmes we have developed to Group now generates well over 50 per cent of its support SMEs across Europe. We have also warmly total income outside the UK, with employees in welcomed recent moves by the UK Government, in more than a dozen countries. That geographic particular, to create an environment to support the Technology Capital Markets diversity is matched by the makeup of the Group’s country’s most promising businesses, including revenue. Today, a third of revenues are generated policies to help facilitate increased investment. by post trade services and a similar share by our FTSE and Information Services division. Our The Group supports the long-term health of our Section 5 Capital Markets division, which even just five economies and the communities in which we years ago was the source of over half the Group’s are proud to operate. Our charitable foundation, revenue, now represents ‘just’ a quarter. It too has The London Stock Exchange Group Foundation, undergone its own diversification with Turquoise, established in 2010, is the basis for long-term our pan-European equity trading platform, and partnership between the Group, our employees MTS, our fixed income trading service, continuing and the charitable organisations we support. The to display strong growth profiles and expanding Foundation has so far raised over £2.5 million and and Governance Regulation geographic reach. we are committed to its long-term success. As our evolution continues, so our core functions We hope you enjoy reading our Yearbook and – facilitating the raising and allocation of capital, learning more about our business. Section 6 matching buyers with sellers, and providing access to funding – remain evergreen. Though the lingering Chris Gibson-Smith effects of the financial crisis continue to be felt, Chairman 6 Contents London Stock Exchange Group plc Yearbook 2014 Contents 09 15 39 SECTION 1: SECTION 2: SECTION 3: OVERVIEW RAISING TRADING ON FINANCE OUR MARKETS London Stock Exchange Group sits at the heart Supporting growing business and helping London Stock Exchange Group’s systems provide of world financial markets. With a history that companies to access international finance is fast and efficient trading, giving investors and dates back to 1801, the Group has changed core to London Stock Exchange Group. Primary institutions access to a full range of securities dramatically over the years but it remains markets in London and Milan provide companies from equities to depositary receipts, ETFs and committed to the principles that shaped it as a and other issuers of equity and debt with access bonds. Innovative new products and indices are business three hundred years ago. to some of the world’s deepest and most liquid providing growth whilst changing regulation pools of capital. The launch of new initiatives provides opportunity for new markets. and routes to market like the ELITE programme and the High