22 November 2019

ESMA: Steven Maijoor delivers keynote at EFAMA Investment Management Forum

The Chair of the ESMA, Steven Maijoor, has delivered the keynote address at EFAMA’s Investment Management in which he focused on fund liquidity and how asset management can play a role in the Capital Markets Union, while supporting investor protection and financial stability.

Improving the functioning of the internal market is at the core of ESMA’s mandate, and asset managers – whether managing UCITS or alternative funds – are a key part of work in particular when it comes to fostering supervisory convergence across the EU. The importance of asset management in and for the EU can hardly be overstated. The Union is home to more than 3,000 asset management companies with funds worth sixteen trillion euros of assets under management, making it the second largest fund market worldwide.

And this industry is thriving not least because the EU provides excellent operating conditions: a vast single market based on a regulatory framework which promotes competition and financial stability. Existing regulatory frameworks, including the UCITS Directive and AIFMD, have improved the functioning of markets, their transparency and ultimately the protection of investors.

Mr Maijoor then focuses on the issue of liquidity, which has been a key concern for a long time in the asset management sector. Then he talks regarding ESMA’s activities in relation to fund liquidity. In particular, he highlights the main findings of ESMA’s risk assessment and ESMA’s strategy, both in terms of stress testing and supervisory action. At the end he briefly comments on the adequacy of the main requirements regarding liqiduity risk under the UCITS framework.

Mr Maijoor concludes: “Fund liquidity remains a crucial topic for ESMA and the securities markets supervisors. It is essential that investors can rely on their fund manager to have in place appropriate arrangements to manage both the liquidity of assets and redemptions in their funds. ESMA’s work on stress testing and fostering a common supervisory action on liquidity management demonstrate our focus and commitment in this area.”

Full speech on ESMA

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