FIIG Securities has welcomed a report from the Australian Financial Centre Forum that recommended a reduction in the regulatory requirements for the issuance of high-quality corporate debt to the retail market.
Recommendations in the report, “Australia as a Financial Centre: Building on our Strengths”, are designed to foster the emergence of a retail bond market by cutting the red tape that deters issuers, FIIG said.
For example, the requirement that issuers of investment grade bonds with a simple structure issue a detailed prospectus should be removed and instead a shorter prospectus could be issued, cross-referencing all relevant documents already lodged with the Australian Securities and Investments Commission (ASIC) or the market operator, the report suggested.
“This is the second report in as many months by government bodies which has recommended clearing away unnecessary regulatory obstacles that are preventing retail investors from accessing the same high-quality debt that is available to institutional investors,” said FIIG Securities chairman Douglas Bates, referring to an ASIC report released late last year.
“It appears that everyone who investigates this area comes to similar conclusions so we hope the Government and ASIC will act on the forum’s recommendations and undertake the reforms needed to help develop a flourishing retail bond market in Australia as exists elsewhere in developed economies,” he said.
