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Sovereign issuers must improve updates

Monday 31 January 2011 - by Andrew Hickley

In spite of pressures from the financial crisis more sovereign debt issuers in sub-G20 countries need to improve their communications to investors, according to a report released today.

Conducted in an international survey of 25 leading investors by stakeholder communications company King Worldwide, the study finds that only around one in three debt issuers provides information and updates to their investors at least once a year.

Half of the investors in this debt assert that they would like updates at least once a quarter, with more frequent meetings with issuers also high on their agenda.

However, while 76 per cent of investors listed transparent and frequent communications as a key factor for investing, political stability, a strong track record of debt repayment, and liquidity were found to be most desirable factors for investors, with 80 per cent of those surveyed listing these as key issues.

The survey also found that the actual credit rating of sovereign debt is not important to over half of the participants, with only one in three believing that the credit rating is key to their investment.


"This research reinforces the opportunity that issuers have to create a more direct engagement with the financial markets," said Oliver Niedermaier, ceo at King Worldwide.

"It shows quite clearly that the information flow should be improved, and that the sovereign debt issuers need to be more proactively managing relationships with investors through a more structured communications programme that gets to the end investor directly."


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