AFME has today published the Capital Markets in the UK Key Performance Indicators report. 

This report is an extension of the seventh edition of AFME’s annual Capital Markets Union Key Performance Indicators report, which tracks the development of the European capital markets ecosystem. The purpose of this report is to assess the UK’s progress in enhancing and expanding its capital markets against a set of benchmark indicators.

We group our eight indicators into four areas which seek to measure the various features needed to develop an efficient, deep, and interconnected capital market, namely:

1. Access to capital

2. Availability of pools of capital for investment

3. Transition to sustainable finance and digitalisation

4. Efficiency of capital markets ecosystem and integration

We compare the evolution of the UK’s capital market, according to our indicators, with other global regional peers such as the United States (US), China, the European Union (EU), Japan, Australia, and some selected EU Member States.

Key findings

This report demonstrates that the UK remains one of the leading global financial centres, however for the second consecutive year the gap between the UK and other markets continues to narrow. There remain positive indications that the UK can continue to use the advantage that exists, and the capacity that exists, to drive future growth and expand key areas such as financial technology and sustainable finance.

UK capital markets have maintained their role as a pivotal hub for capital market funding. Over the past three years, UK corporates have raised a quarter of their funding via public markets. Despite the challenges faced in 2022, capital markets issuance for UK non-financial corporates experienced growth in 2024, continuing the recovery from 2023. However, a longer-term perspective reveals a significant downward trend over the past decade, with convertibles and IPO issuances declining by over 90%, and follow-on issuances decreasing by 30%.

Delistings have remained consistent, averaging around 200 annually since 2019. The ability of small and medium-sized enterprises to secure equity risk financing is crucial, with the funding gap between the US and UK increasing by nearly a third to 0.36% of GDP compared to 2023. Despite a slowdown in the addition of new unicorns, the UK holds the position of having the fourth largest number of unicorns globally.

UK households continue to have substantial savings invested in capital markets instruments, amounting to 145% of GDP. However, UK issuers have seen a decline in their position as originators of green bonds within Europe, falling to the fifth place from third in 2023.

The UK continues to be a global and regional hub for FinTech companies, driven by innovative ideas, a supportive regulatory environment, and high levels of funding. Nevertheless, the UK might be losing its competitive edge in the FinTech sector, particularly in the emerging field of tokenised securities.

Over the last two decades, the UK equity market has been consistently declining, now representing only 3.4% of the world’s market capitalisation in 2024. Additionally, the securitisation market in the UK remains underdeveloped and underutilised compared to other regions, presenting a substantial potential for growth and expansion.