We have spent the past several days discussing why efforts by international and domestic regulators to examine mutual funds as sources of systemic risk are unnecessary and inappropriate.
In their search for ways that investment funds can pose risks to the financial system, regulators and central bankers from around the globe have proposed an arbitrary threshold: any investment fund with assets of more than $100 billion should automatically be subjected to further...
U.S. and international banking regulators, in their search for ways that mutual funds and their managers could threaten financial stability, have come up with a simple story: fund investors and asset managers “crowd or ‘herd’ into popular asset classes or securities” and thus “magnify...
Why Designating Funds as SIFIs Could Hurt Retirees By Paul Schott Stevens (As published in American Banker, May 12, 2014) The regulatory drive to designate mutual funds or their managers as systemically important financial institutions increasingly looks like a campaign to extend the...
Second in a series of Viewpoints postings on funds and financial stability. The threshold set by the Financial Stability Board (FSB) for examining whether a regulated fund could pose risk to the financial system should be redrawn—or better yet, withdrawn.
U.S. and international regulators are examining whether asset managers or the investment funds that they offer could be sources of risk to the overall financial system and should thus be designated as systemically important financial institutions (SIFIs).
Yesterday’s editorial in the Wall Street Journal, “The Feds Target Money Managers,” neatly summed up the case against treating asset managers as systemically important financial institutions (SIFIs) and subjecting them to bank-style regulation.
DC scene setter, 2013–2014: The Financial Stability Oversight Council (FSOC) is examining asset managers for possible “systemically important financial institution” (SIFI) designation, which would bring with it enhanced prudential regulation from the Federal Reserve. Such “bank-style”...
Letter to the Editor of the Wall Street Journal: The Complexity of Retirement Preparedness Paul Schott Stevens, president and CEO of the Investment Company Institute, submitted the following letter to the editor of the Wall Street Journal: Clearly, savers face challenges in planning...
ICI: FSOC Seeking “Pretexts” to Designate Funds Washington, DC, April 24, 2014 - ICI President and CEO Paul Schott Stevens made the following statement in response to media reports that the Financial Stability Oversight Council (FSOC) has stepped up its review of major asset managers...
