Speaking at the IPE Conference & Awards in Barcelona, Pascal Blanqué, chief executive and head of institutional business at asset manager Amundi, said: “We will see regulators more and more asking for proper liquidity policies, including a proper definition of liquidity starting with liquidity indicators, pricing policies and new relationships with counterparties.”
This move towards change in liquidity polices will result from the shift in market structure seen in recent years, as banks have retreated from the market making while investors simultaneously frantically seek yield, he said.
“This liquidity problem we have got on the table – on the one hand, we have an excess of macro liquidity (quantitative easing) and, at the same time, a deterioration in micro liquidity,” Blanqué said.
Olivier Rousseau, executive director at French national pension reserve fund Fonds de réserve pour les retraites (FRR), said pension funds had to be careful about the concept of chasing illiquid assets.
“If you do it because you no longer get the returns you expect from safe bond investments, and you are chasing very long-duration infrastructure debt or real estate debt, then that can be another aspect of moving outside the natural habitat, and that can be very risky,” he said.
Full article (IPE subscription required)
© IPE International Publishers Ltd.
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article