Displaying items for 2019

With 2020 rapidly approaching, New City Initiative (NCI) takes a look at some of the key issues, which could potentially impact its members over the course of the next 12 months.Liquidity risk will not be overlooked in 2020Few would dispute the entire Woodford episode has sullied the reputation of the UK Financial Conduct Authority (FCA). Not only has this whole incident cast a shadow over the FCA, but it is likely to prompt the regulator into adopting a firmer line on the asset management industry. It is very probable the FCA (and other regulators) will now take a much closer…

As an international financial hub, Singapore is widely considered to be among one of the world’s leaders, but the country has yet to become a top-tier fund domicile.  Even though some domestic funds do domicile themselves in Singapore, the local market continues to be overshadowed by offshore centres such as the Cayman Islands, Luxembourg and Ireland. However, the Monetary Authority of Singapore (MAS), the country’s financial services regulator, is trying to change this with the launch of the Variable Capital Company (VCC).The VCC: Taking away some of the offshore pieThe majority of Singaporean funds have historically been structured as one…

Two years ago, cryptocurrencies such as Bitcoin exploded onto the scene. As more retail investors started piling into this nascent asset class, its price reached unfathomable heights, only to plunge dramatically not long after. Happening in parallel to the cryptocurrency bubble was the sudden proliferation of initial coin offerings (ICOs), best described as an unregulated crowdfunding device popular among (some) technology start-ups, which leverages blockchain to raise funds from investors through the issuance of cryptocurrencies.Most institutional asset managers chose not to invest in cryptocurrencies or ICOs as the instruments were seen as being largely unregulated and vulnerable to fraud, money…

In just under two months’ time, the UK’s membership of the EU is poised to expire. If the current political sentiment is anything to go by, the UK looks set to leave the EU without a comprehensive deal in place. While this will undoubtedly cause widespread disruption, the funds’ industry is in a less precarious position than many other sectors. Both the UK’s Financial Conduct Authority (FCA) and the European Securities and Markets Authority (ESMA) have concluded reciprocity agreements which should facilitate a degree of stability and continuity for asset managers selling investment products on both sides of the Channel. While…

Reform of the $595 trillion OTC derivatives market has been a regulatory priority ever since the financial crisis. While strong progress has been made towards transitioning vanilla OTC products into centralised clearing, a lot of contracts – either because their underlying properties do not align with CCPs’ exceptionally strict risk criterion or they are just too complicated – are still traded bilaterally between counterparties. Regulators concede these bilateral OTC trades are a systemic risk, but there are growing concerns – at least from the buy-side – about the regulatory treatment being levelled on some of these uncleared OTCs. Six years ago,…