Letter bomb
Banks in the sterling bond market have been left shell-shocked by a letter from one of the market’s largest investors. Melvyn Westlake assesses the likely fallout from head of credit Paul Mingay’s letter threatening to boycott bond issues unless banks provide liquidity.
Morley Fund Management, one of Britain's biggest institutional investors, has lobbed a grenade into the sterling credit markets. And there are likely to be casualties.Paul Mingay, Morley’s head of credit, has written to around 15 of the leading market makers for sterling bonds, complaining about the lack of liquidity in the secondary market. Not only is he threatening not to buy new bond issues arranged by investment banks that do not provide adequate support to the secondary market
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