What are shareholder rights really worth? In the UK, shareholders prize their pre-emptive right not to be diluted by new equity as a fundamental principle. Most US investors lost that right in the 1960s and they do not miss it.

Ordinarily, this transatlantic culture clash would just be a curiosity. But the contrast between the recent troubles encountered in British banks’ rights issues and rapid capital-raising by US banks has raised questions about the UK regime. As a result, the Treasury and the Financial Services Authority are reviewing the rights issue process.