FSA report to make case for tighter listing controls

The Financial Services Authority (FSA) is next week expected to propose tighter listing requirements in a long-delayed paper on the quality of the City's capital market, amid concerns over the quality of some companies raising money in London.

FSA chief executive Hector Sants will unveil the findings on 14 January months after the paper was originally scheduled to be published. It is thought to have been put on the back burner during the autumn as machinations surrounding the Northern Rock fiasco took centre stage.

The London Stock Exchange LSE) last year attracted 86 initial public offerings from 22 countries. Between them they raised almost 15bn double the 7bn raised in offerings by non-US companies on the New York Stock Exchange and Nasdaq combined.

London has, in particular, courted listings from Russia and other countries from the former Soviet Union, but these have frequently raised concerns over corporate governance.

Speaking last April, New York Stock Exchange chief executive John Thain launched a thinly veiled attack on London when he said: "I am very concerned about the quality of corporate governance, the transparency of company financials and the protection of minority shareholders. A number of Russian companies raise serious questions around these issues."

And last spring Roel Campos, a commissioner at the US Securities and Exchange Commission, likened the Alternative Investment Market, which is regulated by the LSE rather than the FSA, to a gambling den. "I'm concerned that 30 per cent of issuers that list on AIM are gone in a year," said Mr Campos. "That feels like a casino to me."