Another unexpected VCT risk

[127tolmers]

https://www.londonstockexchange.com/new ... s/16172807

THAMES VENTURES VCT 2 PLC (the “Company”)
LEI: 21380035MV1VRYEXPR95
18 OCTOBER 2023

SPECIAL ADMINISTRATION OF THE COMPANY’S CUSTODIAN OF QUOTED ASSETS

Since March 2022, the Company has used IBP Markets Limited ("IBP") as custodian for its quoted investments. IBP is an FCA authorised and regulated wholesale broker, providing custody services and access to equity and fixed income securities for non-retail clients (which includes the Company).

On 13 October 2023, the FCA published a supervisory notice under section 55L(3)(a) of the Financial Services and Markets Act 2000 imposing certain restrictions on IBP and putting it into special administration.

Further details can be found on the FCA website at https://www.fca.org.uk/news/news-storie ... nistration.

The Joint Special Administrators are now carrying out an initial assessment of the client money and custody assets held by IBP. Due to concerns whether there were appropriate systems and controls in place to ensure adequate protection for client monies and client assets at IBP, this assessment may take some time.

Approximately 19% of the Company’s total Net Asset Value (“NAV”) (as at 30 June 2023) is held with IBP as quoted assets, although the quoted portfolio is not traded frequently and there are no trades pending execution. The percentage of NAV for each share class within the Company is shown below:

Share class % of NAV held with IBP as at 30 June 2023
Ventures 12%
Healthcare 29%
AIM 70%
DSO D 0%
DP67 0%
The Company, through its advisers, has begun liaising with the Joint Special Administrators to understand what, if any, impact the failure of IBP may have on any of the Company's quoted assets. Further updates will be provided to shareholders and the market once more details become available.

[CrackAddick]

This could prove interesting. Thankfully my holding in the AIM and healthcare share classes are minimal.

It's especially unfortunate timing in respect to the AIM class. They have struggled to invest the funds they raised at launch and the board had been looking into strategic options for that share class. I guess that could be on hold now while the administrators go through the books. Which in turn may mean the funds they had raised are not deployed into qualifying investments within the HMRC time frame. Interesting times ahead........

[wanderer]

Thanks for sight of this (I think!). I invested in the AIM class, so it looks like a lot of trouble ahead for me...

[Karellan]

Thanks for noting this 127Tolmers. I have TV2V and TV2H. Its been a bit of a disappointment for me with the transfer to Foresight managers and weak share price performance. Sounds like there is more trouble to come. Little good usually comes of involving administrators. I think that I had my eye off the ball with these.

I wonder whether there are other VCTs or investment trusts affected.

[Karellan]

Answering my own question it looks like IBP had about 636M in its custody service. This seems small to me and as it was founded in 2017 possibly not too much damage. This must have happened while under Downings control.

[barchid]

Gents
I don't know if any of you read Roger Lawsons blog on sharesoc/signet but I find it pithy and raises interesting point often, he raised this matter earlier in the week and was pretty negative about it, worth a read for any holders I guess.

[Karellan]

Gents
I don't know if any of you read Roger Lawsons blog on sharesoc/signet but I find it pithy and raises interesting point often, he raised this matter earlier in the week and was pretty negative about it, worth a read for any holders I guess.

Many thanks barchid , I have just had a look and Roger Lawsons problem is with TV1 and not TV2 etc so it has already spread. Indeed the blog is depressing. I wonder how Foresight are going to feel about this just aquiring two VCTs with a problem. I am starting to wonder whether this is the reason for the weak share price performance. TV2Hs price acutally did well until Feb 22 , it is now down a lot.

I dont know whether its just me but I was having trouble getting investergate to show TV2 (H or V) entries well. I can see the TV1 entries OK.

[Karellan]

I have just looked through the unexciting half yearly reports for TV1 and TV2. The custody problem is still awaiting the special administrators. Although neither has much cash tied up with the errant IPB it may affect buy backs for TV1 as the quoted stock cannot be sold.

This technical problem is having an effect,