The recent publication of the Upper Tribunal’s decision that the former CEO and CFO of Metro Bank were knowingly concerned in a breach of the Listing Rules by the bank provides a number of takeaways for listed companies and directors. A summary of these is set out below but for more detail on the decision please see our Notice in a Nutshell.

  1. Creating and updating market expectations: Where a company chooses to announce information in circumstances where it is not obliged to do so, the information must be accurate and up to date.  Once a market expectation has been created, it needs to be kept under review and consideration given to announcing developments potentially impacting that expectation.This may mean that a further announcement is required if something changes, even if the change is not otherwise something that would normally be announceable under the Market Abuse Regulation. 
  2. Relevance of regulator communications: Each announcement to the market needs to be given separate careful consideration, regardless of any discussions with regulators or other third parties.  Agreement with a regulator regarding regulatory reporting does not impact duties to give accurate information to the market. 
  3. Dealing with confidential information: Consider carefully any confidentiality concerns and the extent to which certain information could be disclosed without impacting any confidentiality obligations.  Be wary of justifying non-disclosure on the basis of confidentiality, particularly without exploring with the relevant party to whom confidentiality is owed. 
  4. Dealing with uncertainty: Where information is uncertain or investigations are ongoing to determine the position, it may nevertheless be necessary to make an interim announcement explaining what is known and what is not known so that the market is properly informed, even if this is embarrassing or commercially inconvenient.  If it is possible that the impact of the outcome could be material, it should not be assumed that it will be immaterial. 
  5. Advice: Consider seeking advice on market announcements from the company’s broker as well as from internal and/or external counsel and, when getting advice, ensure that advisers have been properly briefed with all relevant information and that there are clear records of the question asked and the advice provided. This includes ensuring advisers have seen a copy of the proposed draft announcement and that significance of information is not downplayed or misrepresented.
  6. Record-keeping:  Given disclosure decisions may be scrutinised some time after the event, keep appropriate contemporaneous records of discussions held reflecting the information available and the basis on which decisions have been reached.

If you would like any more information on the issues raised in this blog please do not hesitate to contact either of the authors. For further knowledge resources in this area, please see our dedicated Financial services interventions and investigations hub.