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Going public: UK companies’ use of capital markets

Author

Listed:
  • Pattani, Aashish

    () (Bank of England)

  • Vera, Giuseppe

    () (Bank of England)

  • Wackett , James

    () (Bank of England)

Abstract

Public capital markets play an important role in financing the activities of non-financial companies in the United Kingdom, providing them with the main alternative to bank loans and private sources of finance. Although a small number of UK companies issue public bonds and equity, those that do account for a relatively large share of domestic investment and employment. Since the start of the financial crisis in 2007, bond and equity issuance has allowed some large companies to dampen the impact of the contraction in bank lending and the worsening economic outlook on investment and hiring. This suggests that there may be macroeconomic benefits to broadening access to public capital markets. The Bank has helped support primary corporate bond issuance at times of impaired secondary market functioning since 2009 through its Corporate Bond Secondary Market Scheme.

Suggested Citation

  • Pattani, Aashish & Vera, Giuseppe & Wackett , James, 2011. "Going public: UK companies’ use of capital markets," Bank of England Quarterly Bulletin, Bank of England, vol. 51(4), pages 319-330.
  • Handle: RePEc:boe:qbullt:0064
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    File URL: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2011/going-public-uk-companies-use-of-capital-markets.pdf?la=en&hash=C5E55C0F9C16E5AF4ADBC3F296ECE257053EEF29
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    References listed on IDEAS

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    1. Campello, Murillo & Graham, John R. & Harvey, Campbell R., 2010. "The real effects of financial constraints: Evidence from a financial crisis," Journal of Financial Economics, Elsevier, vol. 97(3), pages 470-487, September.
    2. Becker, Bo & Ivashina, Victoria, 2014. "Cyclicality of credit supply: Firm level evidence," Journal of Monetary Economics, Elsevier, vol. 62(C), pages 76-93.
    3. Button, Richard & Pezzini, Silvia & Rossiter, Neil, 2010. "Understanding the price of new lending to households," Bank of England Quarterly Bulletin, Bank of England, vol. 50(3), pages 172-182.
    4. Bell, Venetia & Young, Garry, 2010. "Understanding the weakness of bank lending," Bank of England Quarterly Bulletin, Bank of England, vol. 50(4), pages 311-320.
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    Cited by:

    1. Alan Hughes, 2014. "Short-Termism, Impatient Capital and Finance for Manufacturing Innovation in the UK," Working Papers wp457, Centre for Business Research, University of Cambridge.
    2. Farrant, Katie & Inkinen, Mika & Rutkowska, Magda & Theodoridis, Konstantinos, 2013. "What can company data tell us about financing and investment decisions?," Bank of England Quarterly Bulletin, Bank of England, vol. 53(4), pages 361-370.
    3. Muhammad Naveed, 2015. "Capital Structure Dynamics and Sensitivity Analysis: A Case of Developing Country?," Proceedings of International Academic Conferences 2603875, International Institute of Social and Economic Sciences.

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