Equity appeal: Markets can be cheaper than banks, says Ibec chief
Ireland and Europe must unite stock exchanges under common trading rules that boost liquidity and help businesses to finance their growth through capital markets, Ibec CEO Danny McCoy has told leaders of 35 stock exchanges gathered in Dublin.
Mr McCoy, was speaking at yesterday's annual meeting of the Federation of European Securities Exchanges, which brought together stock market directors from 30 countries across Europe.
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He said the EU should encourage businesses to issue securities as a more profitable path to reaching their goals.
"When Irish businesses look for finance, they go the traditional route to a bank. There's an aversion to the idea of giving up a share of their business to somebody else. They'd rather borrow and hope for the best, But equity is a really smart way to go," Mr McCoy told the Irish Independent.
He said the Capital Markets Union, an ongoing EU effort to create a truly single market for capital rooted within Europe's stock exchanges, promises to open doors for easier, cheaper financing of businesses and development projects and, in turn, spur Irish banks to lower their own lending rates.
The National Competitiveness Council found in its 2019 Cost of Doing Business report that business borrowers in Ireland face bank interest rates averaging 3.3pc, nearly double that charged in other EU countries.