New Zealanders' confidence in financial markets improves: FMA survey

Monday 29th May 2017

Almost two-thirds of New Zealanders have confidence in the country's capital markets, up from just over half last year, a Financial Markets Authority survey shows.

Five percent of 1,000 people surveyed by Colmar Brunton are very confident in financial markets and a further 60 percent are fairly confident, up from 3 percent and 53 percent a year earlier, the survey shows. That rises to a combined 69 percent for the 891 people identifying as investors, up from 59 percent in 2016. Non-investors were still wary of markets, with a net 40 percent confident in them, down from 43 percent a year earlier, although fewer people identified as non-investors.

"All these scores show we are starting to see a shift in the public's historic mistrust about markets and financial services," FMA chief executive Rob Everett said in a statement. "Prior to 2015 confidence built quite steadily and then, with market ructions last year, it dipped."

The FMA was set up as a super regulator in 2012 as part of a securities law overhaul that was designed to reinvigorate investor faith in markets after the collapse of the mezzanine finance sector through the 2000s and the lingering distaste for stocks after the 1987 crash.

The regulator completed its licensing process at the end of last year, adding fund managers to the list of service providers who needed the watchdog's tick of approval to do business in New Zealand, and issued 201 licences during the two-and-a-half year period.

Everett said investor confidence appeared more resilient, having gone through the heightened volatility last year stemming from the UK's vote to quit Europe and the election of US President Donald Trump.

"One of the factors influencing perceptions is likely to be the transformation of the regulation of financial service providers, completed in December 2016," he said. "We hope to see a continuing trend of investors retaining confidence in the conduct within and integrity of the market, even if the performance of their investments goes up and down."

(BusinessDesk)

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