Key facts
- Lucy Rigby has been appointed Economic Secretary to the Treasury for a second time.
- During her previous tenure, Rigby championed a stamp duty holiday for newly-listed companies and a campaign to encourage retail investors.
- London's equity markets have experienced numerous takeover bids, leading to a dry IPO pipeline.
- Industry figures are advocating for the abolition of stamp duty on shares to boost the market.
- Fintech companies are seeking tax incentives and capital access to remain in the UK.
- There is a hope that Rigby's appointment will lead to greater policy consistency and long-term certainty.
Lucy Rigby has returned to the role of Economic Secretary to the Treasury, marking her second tenure in the position and the fifth change in City minister within two years. Her reappointment has been met with cautious optimism by the financial sector, which faces significant challenges including a wave of takeovers and a dwindling pipeline of initial public offerings (IPOs).
During her initial nearly nine-month term, Rigby was seen as a constructive figure who fostered better relations between the government and the financial industry. She previously championed initiatives such as a stamp duty holiday for newly-listed companies and a campaign aimed at increasing retail investor participation in UK equities. Despite some skepticism regarding the effectiveness of the 'Savvy the Squirrel' mascot, her efforts were noted for building connections with banks and investment platforms.
However, upon her return, Rigby faces a market grappling with numerous billion-pound takeover bids, with companies like Intertek, Rotork, and easyJet being targeted. This trend has contributed to a significant decline in new listings. Georgina Hamilton, a fund manager at Polar Capital, noted that the current government has not yet managed to reverse the decline in market capitalization and highlighted the need to address the persistent valuation discount in the UK market.
Industry figures are urging Rigby to prioritize tackling the issue of company delistings from the London Stock Exchange. Many have called for the complete abolition of stamp duty on shares, arguing that such a move would reduce red tape and prevent companies and investors from being drawn to markets like New York. Rigby also holds responsibility for personal savings policy, with renewed calls to reform ISA limits to encourage investment in stocks and shares over low-interest accounts.
The UK's fintech sector has also welcomed Rigby's return, with some figures in the industry expressing confidence in her understanding of their needs. However, the sector is still awaiting a major fintech IPO, despite some companies listing on the London Stock Exchange Group's early-stage networks. Rigby is expected to work on galvanizing fintech IPO prospects and implementing tax incentives and capital access measures to retain businesses in the UK.
Ultimately, industry leaders hope that Rigby's appointment signifies a period of stability, contrasting with the frequent turnover seen previously, which hindered regulatory reform. The financial services industry seeks clear, tangible policy actions, consistency, and long-term certainty, particularly amid ongoing concerns about potential banking sector tax raids. If Rigby receives sufficient time and support, she may become a key ally for the Square Mile.