Ann: GENERAL: NZX: Update from NZX Listed Issuer Forum 2015

• Release Date: 14/10/15 08:48
• Summary: GENERAL: NZX: Update from NZX Listed Issuer Forum 2015
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					NZX
14/10/2015 08:48
GENERAL
NOT PRICE SENSITIVE
REL: 0848 HRS NZX Limited

GENERAL: NZX: Update from NZX Listed Issuer Forum 2015

NZX held its annual Listed Issuer Forum in Auckland on Monday, attended by a
record number of senior executives from listed companies and NZX
stakeholders. More than 150 people attended the forum from more than 100
organisations.

Topics covered included:

o NZX update: presented by CEO Tim Bennett and Head of Markets Mark Peterson

o Investing in listed companies, an institutional investor's view: presented
by Brian Bourd?t, New Zealand Super Fund, Manager NZ Equities
o Board communication and interaction with shareholders and the investor
community: presented by Tony Carter, Chairman, Air New Zealand; Chairman,
Fisher & Paykel Healthcare; Director, Fletcher Building; Director, ANZ Bank
New Zealand; Independent Chairman, Blues LP

Forum address by NZX CEO Tim Bennett

In his address to the forum, Tim Bennett discussed the outlook for New
Zealand's capital markets; the opportunities and challenges NZX sees ahead;
and the areas of long term market development that NZX is focussed on.

Key themes of the presentation were:

1. Capital markets matter
o To fund business growth and realise New Zealand's economic potential, New
Zealand needs a deep, liquid capital market
o Successive governments realised this in the late 2000s and through a range
of initiatives, took up the challenge of rebuilding the capital markets, in
particular through the work instigated by the Capital Market Development
Taskforce in 2009

2. We are making progress, but are not yet at half way
o New Zealand's capital markets have had an outstanding past five years
thanks in no small part to a stable, growing economy and a significant market
development programme
o If the Australian experience is anything to go by, where compulsory
superannuation was introduced in the 1990s, our markets are at the start of a
10 to 15-year growth journey. We are not done yet - in some ways, we are not
yet at half-way
o New Zealand's equity market capitalisation to GDP is currently around 40%;
to be a real engine of economic growth, it should be 60-70%

3. Unfortunately, we sometimes have a habit as a country of thinking the job
is done, when actually we have only just made a good start
o There are some warning signs ahead - a lack of focus on previously agreed
direction in terms of market development; a sub-optimal structure of the
KiwiSaver market inhibiting development of the fund management industry; and
increasing integration of the New Zealand and Australian markets, limiting
development of the capital market on this side of the Tasman
- Firstly, actions such as the endorsement of an unregulated market are
disappointing and point to an apparent loss of focus in sticking to the
widely consulted on and endorsed reforms that have been put in place
- Secondly, the structure of the KiwiSaver market and, by extension, the fund
management industry, was highlighted by Treasury in a report released in
September. Particular concerns are the concentration of providers, with 93%
of assets under management held by six providers, and the lower level of
allocation to growth assets which has negative implications for future
retirement income
- Thirdly, we are seeing increasing integration of the New Zealand and
Australian capital markets. For large listed companies we are already the
most closely integrated markets in the world. However, for small and
mid-sized businesses, both private and public, a strong domestic capital
market, including a range of fund managers focused on smaller business, in
New Zealand is critical
- The current focus of Australian investors on NZX-listed companies reflects
the relative strengths of our economies, which will change over time. And the
historical Australian government measures designed to grow Australia's fund
management industry are now, ironically, being used to inhibit the growth of
New Zealand's funds industry
o The implication for capital markets development in New Zealand is that we
are not experiencing the development of fund managers focused on small and
mid-sized businesses that we require to support growth of the equity market

4. The opportunity ahead
o There will be an additional $40B in KiwiSaver accounts over the next five
years.   Simplistically, we can either invest those funds offshore, or we
can invest in New Zealand businesses, which will reduce our external debt and
provide the foundation for future economic growth
o To be successful we need a single minded, unwavering commitment to our
markets and New Zealand market development - this is the responsibility of
all participants in the markets, on behalf of all New Zealanders
- We have had a strong start to the rebuild of the capital markets but we
can't be complacent
- To use a sporting metaphor, we have a great first half - let's all work
together to ensure we have a terrific second half

NZX Regulation update

NZX Regulation hosted a series of workshops at the forum that focussed on a
range of topical regulatory matters and market trends affecting listed
issuers, intended to provide interactive and practical support for issuers.
Sessions were hosted by senior staff from NZX's Regulation, Policy and Market
Services teams, along with Chapman Tripp.

Topics covered included:
o Life cycle of a secondary equity capital raise
o Issuers' disclosure obligations
o NZX's frontline surveillance function and regulatory involvement in price
movements
o NZX Policy update
o Recent regulatory trends in the capital markets, presented by Chapman Tripp

NZX Head of Market Supervision Joost van Amelsfort commented: "NZX Regulation
is committed to providing an ongoing programme of support and engagement with
the market on key regulatory issues."

"Supporting issuers to facilitate and develop a best practice compliance
culture is fundamental to the operation and functioning of vibrant markets,
which drives investor confidence and market integrity."

NZX Regulation held a series of similar workshops last week in Christchurch
for issuers unable to attend the forum, and will continue to host workshops
throughout New Zealand during 2016.

For further information please contact:
Kate McLaughlin
Corporate Communications
T: 09 309 3654
M: 027 533 4529
E: [email protected]

About NZX Limited
NZX builds and operates capital, risk and commodity markets and the
infrastructure required to support them. We provide high quality information,
data and tools to support business decision making. We aim to make a
meaningful difference to wealth creation for our shareholders and the
individuals, businesses and economies in which we operate. To learn more
about NZX, please visit: www.nzxgroup.com
End CA:00271692 For:NZX    Type:GENERAL    Time:2015-10-14 08:48:17