Harvey moves into banks bonds after crackdown on risk

Cazenove's Peter Harvey is taking a 21.1% overweight position in bank bonds, as the UK Government prepares to crackdown on risk taking in the sector.

  Chancellor George Osborne has announced an independent investigation with a view to separating investment and retail banking, and his emergency Budget included an annual levy of over £2bn on UK banks. The sector is the heaviest overweight in Harvey’s £453m Strategic Bond fund versus its benchmark, as he expects tighter regulation to benefit banks.  His exposure is mainly through safer senior debt, and to banks in Europe and the US as well as the UK. “Now is not the time to be making the switch to riskier debt because we are still travelling as far as European bank capitalisati...