Regulators keep open mind on funds reform after COVID stresses

By Huw Jones
·2 min read
FILE PHOTO: Ashley Ian Alder, Chief Executive Officer of Securities and Futures Commission and Chairman of the Board of International Organization of Securities Commissions, attends the Asian Financial Forum in Hong Kong

By Huw Jones

LONDON (Reuters) - There are no "pre-determined" decisions on how to strengthen resilience of investment funds in light of coronavirus stresses seen in March, an industry conference was told on Tuesday.

Regulators are studying potential reforms as soon as next year of money market funds, open-ended funds and leveraged hedge funds, prompting industry warnings about hasty changes not based on data.

Reforms are likely to focus on bolstering liquidity buffers at funds, rather than replicating banking rules that mandate capital cushions.

G20 financial regulators said last week that without huge central bank intervention, some funds would have suffered far more during market volatility when economies went into lockdowns to fight the pandemic.

"There are some very serious projects being launched now globally, there are no pre-determined policy outcomes," Ashley Alder, chair of IOSCO, a global umbrella body for securities regulators, told an Investment Association online conference.

The general mantra is to look where there may be sub-optimal resilience and what was needed to avoid a repeat of central bank intervention in the next crisis and there are no answers yet, Alder said.

"It is a balance and it is around aspects of resilience and levels of resilience that are sensible," Alder added.

In the past, securities regulators and central banks have disagreed over how to regulate funds, but Alder said there has now been a "sea change" in cooperation between them.

The funds sector, part of what has been dubbed 'shadow banking', has grown hugely since the last financial crisis a decade ago, drawing closer regulatory scrutiny.

"We are no longer in the shadows. I think as an industry we need to ... be more thoughtful about the way we positively engage with the creation of the policy agenda," Investment Association Chair Keith Skeoch said.

The work by regulators on funds was a "huge opportunity to get good data driven analysis on the table", Alder said.

(Reporting by Huw Jones; Editing by Catherine Evans)

  • Up next
  • Up next
  • Up next
  • Up next

Latest Stories

  • SNP and Scottish Greens power-sharing deal ends following climate target row

    The SNP and Scottish Greens power-sharing deal has formally ended following a row over a climbdown on climate targets, Sky News understands. It comes after First Minister Humza Yousaf summoned a meeting of his Cabinet - usually held on a Tuesday - this morning following speculation over the future of the Holyrood deal, first struck by his predecessor Nicola Sturgeon. There has been unhappiness in the Green Party after the Scottish government scrapped its commitment to cut emissions by 75% by 2030.

  • Shawarma restaurant in Cairo brings taste of home for displaced Palestinians

    A Palestinian businessman displaced by the war in Gaza is bringing a taste of home for fellow refugees with a Shawarma restaurant he has opened in Cairo. Abu Al-Awn hopes his time outside Gaza will be temporary and he is determined to return to the enclave once the war between Israel and Hamas is over. Rimal was Gaza City's busiest shopping center, with large malls and main bank offices before Israeli forces reduced most of it to rubble.

  • SNP 'scraps' power-sharing deal with Scottish Greens

    The SNP has scrapped its power-sharing deal with the Scottish Greens, according to reports. The Bute House Agreement was reportedly dropped following an emergency Cabinet meeting at Bute House in Edinburgh on Thursday morning. Scotland's First Minister Humza Yousaf had called the meeting of the Scottish cabinet following growing tensions between the SNP, which is the largest party at Holyrood, and the Scottish Greens, who are currently their junior partners in the Scottish Government.

  • FOREX-Yen hits fresh 34-year lows against dollar ahead of BOJ meeting

    The yen hit fresh 34-year low versus the dollar and a 16-year low against the euro on Thursday as investors expect a Bank of Japan policy meeting that ends on Friday not be hawkish enough to support the Japanese currency. "If they (Japanese authorities) don’t step in, the breach of the 155 level can attract speculative flows as markets expect intervention," said Athanasios Vamvakidis, global head of G10 forex strategy at BofA. "If they buy yen, pressures can still arise because many investors are waiting for intervention to sell the Japanese currency," he added, arguing that the yen could reach 160 even if there is intervention.

  • Kemi Badenoch says Humza Yousaf is being ‘too lazy’ to introduce legislation to exonerate Horizon victims

    Kemi Badenoch has accused Humza Yousaf’s government of being “too lazy to do the work” after the UK Government rejected his plea for Scotland to piggyback on its legislation exonerating the Horizon scandal victims.

  • Anglo American shares soar on £31bn takeover approach from BHP

    The potential deal would create the world’s biggest copper miner, with around 10% of global output.

  • US college protests - live: Texas students arrested and encampment erected at USC

    Over 100 students at NYU and Columbia have been arrested this past week over pro-Palestinian protest encampments

  • Predators, Canucks square off with series tied 1-1

    Vancouver Canucks (50-23-9, first in the Pacific Division) vs. Nashville Predators (47-30-5, fourth in the Central Division)Nashville, Tennessee; Friday, 7:30 p.m. EDTBETMGM SPORTSBOOK: LINE Predators -120, Canucks +100; over/under is 6NHL PLAYOFFS FIRST ROUND: Series tied 1-1BOTTOM LINE: The Nashville Predators and the Vancouver Canucks are in a 1-1 series tie in the first round of the NHL Playoffs. The teams meet Tuesday for the sixth time this season. The Predators won the previous meeting 4-

  • Kings, Oilers meet with series tied 1-1

    Edmonton Oilers (49-27-6, second in the Pacific Division) vs. Los Angeles Kings (44-27-11, third in the Pacific Division)Los Angeles; Friday, 10:30 p.m. EDTBETMGM SPORTSBOOK: LINE Oilers -128, Kings +108; over/under is 6.5NHL PLAYOFFS FIRST ROUND: Series tied 1-1BOTTOM LINE: The Los Angeles Kings host the Edmonton Oilers in game three of the first round of the NHL Playoffs with the series tied 1-1. The teams meet Wednesday for the seventh time this season. The Kings won 5-4 in overtime in the la

  • Avalanche, Jets square off with series tied 1-1

    Winnipeg Jets (52-24-6, second in the Central Division) vs. Colorado Avalanche (50-25-7, third in the Central Division)Denver; Friday, 10 p.m. EDTBETMGM SPORTSBOOK: LINE Avalanche -171, Jets +143; over/under is 6.5NHL PLAYOFFS FIRST ROUND: Series tied 1-1BOTTOM LINE: The Colorado Avalanche and the Winnipeg Jets are in a 1-1 series tie in the first round of the NHL Playoffs. The teams meet Tuesday for the sixth time this season. The Avalanche won the last meeting 5-2.Colorado has a 17-9-2 record

  • Hero teacher restrains teenage girl as stabbings send Welsh school into lockdown

    The girl was arrested on suspicion of attempted murder after the chaos erupted at the end of morning break at Amman Valley School on Wednesday.

  • FTSE 100 LIVE: London outshines European peers amid Anglo American takeover bid

    The FTSE 100 outperformed against its European peers on Thursday, hitting a new high for the third session in a row.

  • Seven teens with alleged 'extremist ideology' arrested in Sydney raids

    Police say they belong to the same network as the 16-year-old boy who allegedly attacked a church last week.

  • Who are the Glazer family and what is their net worth? Erik Ten Hag under pressure at Manchester United

    Future uncertain for Erik Ten Hag after Sir Jim Ratcliffe takeover

  • SNP's power-sharing deal with Greens collapses

    It follows criticism of the government's decision to scrap key climate targets and its response to a review into gender services.

  • Sacha Baron Cohen Section Of Rebel Wilson's Book To Be Censored In UK Edition

    The Pitch Perfect star recently branded the Borat creator an "a******e" after working with him on the 2016 comedy Grimsby.

  • What’s on TV tonight: Johnson & Knopfler’s Music Legends, Dead Boy Detectives and more

    Johnson & Knopfler’s Music Legends Sky Arts, 10pm It’s legends all the way as AC/DC frontman Brian Johnson and Dire Straits’s Mark Knopfler – who, we’re reminded, have sold more than 300 million records between them – sit down with a selection of their musical heroes. The format is pleasingly stripped back and easygoing: three straight-backed chairs arranged in a semi-circle and an invitation to chat for an hour – with Knopfler wielding his acoustic guitar like a fifth limb, making it clear that

  • Kid Cudi cancels tour after breaking foot

    "The injury is much more serious than I first thought," says the rapper as he cancels tour dates.

  • Analysis-BHP's proposed bid for Anglo American is a big bet on copper

    BHP Group's proposed $39 billion buyout of Anglo American is a big bet on copper that could spark a scramble for mining assets as a bullish demand outlook and tight supply for a mineral crucial to the energy transition sends prices to multi-year highs. "The energy transition is only just getting started, and if electricity is the lifeblood of this revolution, copper is the veins and arteries," said Peter Arkell, chairman of the Global Mining Association of China (GMAC).

  • Marlborough racing tips and best bets for today’s races

    Following today’s racing tips? In need of some guidance? Or just fancy a flutter?