Stock Market Challenge 2019

Infrastructure is the new buzzword in finance these days even though infrastructure has been important at least since the days when the Romans built their roads across Britain and Europe. The difference today is that increasingly the government says it cannot finance such infrastructure - roads, railways, power generation, telecoms, airports etc. The telecoms industry is already completely privately owned in most countries as are an increasing number of airports across the world. But governments everywhere are now looking ever more to public private partnerships (PPPs) to provide the annual funding (the annual revenues required to service bank loan and bond interest payments and capital repayments and equity dividends) as well as the actual financing (the arranging of bank loans, bond issues and equity share issues) to provide the cash up-front.

If you live in the UK, you may have seen the Channel 4 television programme on 28th February this year (2013) entitled ‘Bank on Dave’. Burnley Savings and Loans to give it its other name, is a company (not a bank) which offers 5% ‘deposit’ rates to lenders and offers loans to those who cannot obtain funding from the high street banks. So how does Dave do this when the high street banks offer no interest at all or perhaps only ½ or 1%? In fact ‘Dave’ is one of a new breed of ‘brokers’ who simply introduce lenders and borrowers to each other. The key difference from banks is that banks have a balance sheet with a depositor contract on one side and a separate contract with its borrowers on the other whereas a peer to peer company has no such contracts and indeed is not even involved at all in borrowing or lending! This is because in P2P, lending contracts are directly between borrower and lenders and the P2P company does not take ‘deposits’ on to its own balance sheet or keep the loans its customers make on its balance sheet.

The Henley Executive MBA has been ranked as 53rd in the world, 20th in Europe and 7th in the UK.