FSB - Addressing Structural Vulnerabilities from Liquidity Mismatch in Open-Ended Funds
In July 2023 the Financial Stability Board (FSB) published a consultation report proposing revisions to its 2017 Recommendations on Liquidity Mismatch in Open-ended Funds.
AREF had some profound concerns regarding some of the recommendations in the FSB's consultation report. More details about the FSB's proposals and AREF's response to the consultation report can be viewed here.
IOSCO - Guidance for Open-Ended Fund use of Anti-Dilution Liquidity Management Tools
In coordination with the above FSB consultation report,the International Organization of Securities Commissions (IOSCO) published a consultation report on Anti-dilution Liquidity Management Tools – Guidance for Effective Implementation of the Recommendations for Liquidity Risk Management for Collective Investment Schemes.
AREF's response, to the consultation report, highlighted concerns with IOSCO's proposals on guidance for the greater and more consistent use of anti-dilution liquidity management tools for open-ended funds. AREF's response and more details about IOSCO's proposals can be viewed here.
Liquidity Management Contingency Plans
AREF has produced a template AFMs of FIIA can use as a basis for their requests for information from intermediate holders. View more information on the Liquidity Management Contingency plan here.
Recommendations of the European Systematic Risk Board on liquidity risks in investment funds
The General Board of the European Systematic Risk Board adopted a Recommendation to the European Securities and Markets Authority (ESMA) to coordinate with the national competent authorities in undertaking a focused piece of supervisory engagement with investment funds that have significant exposures to corporate debt and real estate assets.
The General Board emphasised that it is important that liquidity management tools are used in a timely manner, as necessary in such circumstances, especially by funds that invest in less liquid assets or assets that become temporarily illiquid and have short redemption periods.
Fund Suspensions
AREF, DATA (Depositary & Trustee Association) and The IA joint Suspensions Q&A guide can be downloaded here.
FCA letter on effective liquidity management
On 4th November 2019 the FCA published an open letter to AFMs on effective liquidity management.
Real estate fund behaviour following the EU referendum
April 2017 - The Independent report commissioned by AREF on real estate fund behaviour following the EU referendum.
FCA - Liquidity management for investment firms: good practice
February 2016 - Update from the FCA on liquidity management for investment firms
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