May 2015 - European fund industry news

The European fund industry in May

European investment fund assets continue to grow

During the month, a number of European fund associations reported increases in the assets and net sales.

EFAMA, the umbrella organization covering 27 such associations, issued its monthly fund industry fact sheet for March and reported that net UCITS assets had reached the EUR 9 trillion mark for the first time.

This was an increase of 2.5% compared to the previous month.

Net sales of UCITS remained strong in March attracting EUR 69 billion in net new money. Long-term UCITS (UCITS excluding money market funds) registered a second consecutive month of net inflows of EUR 71 billion in March. For non-UCITS, total net assets increased by 2.3% to ending the month at EUR 3.5 trillion.

This trend was continued with April figures from ALFI, the Luxembourg fund association, who pointed out on 26 May that Luxembourg fund assets had reached a new record high of EUR 3.5 trillion.

Fund processing automation continues to progress

On 26 May, EFAMA and SWIFT released their end-of-year report on automation and standardisation rates of fund orders.

This report is based on orders received by transfer agents in Luxembourg and Ireland, the leading cross-border fund centres, and confirms that the automation rate and the use of the ISO standards have reached an all-time high.

For both centers around 83% of orders were automated (using ISO standards or proprietary FTP), with Ireland at 86% and Luxembourg at 81%.

The report is published every six months and this edition included an additional survey on the number of new automated links implemented in 2014 with new counterparties. This survey showed that ISO standards remain widely favoured in the market as the most efficient automation option. New ISO links were implemented with 305 counterparties, compared to 9 new links using a proprietary FTP.

ESMA apdates and consultations

In May, ESMA asked the European Commission for an extension of the deadlines for the MiFID II draft technical standards. This was done to allow for a new early legal review process by the Commission that would enable it to flag to ESMA any concerns from a legal perspective related to the technical standards.

The commission agreed with this approach and the new deadline will be the end of September in place of July this year.

On 22 May, ESMA issued a press release calling for a modification of the UCITS Directive to take into account certain obligations under EMIR. The press release was released in the context of its opinion paper on the impact of EMIR on UCITS.

On 12 May, ESMA published an update to its Q&A on AIFMD application. The latest version includes new questions and answers on reporting and calculation of leverage.

At the end of May, ongoing ESMA consultations included:

• Draft guidelines for the assessment of knowledge and competence (closing on 10 July)
• Investment using virtual currency (closing on 21 July)

Fund industry publications in May

Notable publications during the month included:

Fundsquare’s parent company, the Luxembourg Stock Exchange, and Deloitte Luxembourg launched a brochure on listing investment funds entitled LuxSE, the preferred funds listing destination. The Luxembourg Stock Exchange provides a true service offering combining listing, admission to trading and support for continuous reporting obligations. The brochure also points out that more than 6,500 share classes are already tradeable in real time on the markets of the Luxembourg Stock Exchange.

• SWIFT released the findings of a study on the benefits of outsourcing for investment funds
• ALFI issued a brochure on technical guidelines for Luxembourg infrastructure investment vehicles
• Deloitte published a poster on the top priorities of the 2015 regulatory agenda in Europe
• AIMA released a paper entitled Financing the Economy: The role of alternative asset managers in the non-bank lending environment

_{Published on: 29 May 2015}

Fundsquare News 20 - May 2015