Car finance uncertainty deterring investors
20 January 2025
City investors are concerned about investors being deterred by the UK’s approach to rules and regulation as a result of the ongoing car finance commission investigation. Some say it is becoming “difficult to operate” as a result.
JP Morgan’s Kuba Fast said the challenge is when companies have operated by the rule book but are now being penalised by rules being applied retrospectively. “It does not create a predictable business environment.”
US investor appetite is being dampened by concern that regulation-abiding firms could end up being forced to pay out billions of pounds in compensation many years later.
Andy Briggs, chief executive of pension and retirement fund provider Phoenix, toured large investors in the US last October. “Every single one asked me [about the implications of the car finance scandal] as the very first question, because they are trying to assess the scale of that risk premium of investing in the UK, because of ‘retrospection’.”
The supreme court hearing into last October’s DCA decision in the court of appeal starts on 1 April.
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