May 2014 - European fund industry news

The European fund industry in May

European investment fund assets reach EUR 10 trillion

On 28 May, the European Fund and Asset Management Association (EFAMA) announced via its statistics for the first quarter of 2014 that the total assets of European investment funds broke through the EUR 10 trillion mark at the end of the quarter.

This was an overall increase of 3.8% and includes UCITS and non-UCITS funds: 

• For UCITS, assets increased by 3.5% to EUR 7.1 trillion 
• For non-UCITS, assets rose by 4.4% to pass the EUR 3 trillion mark for the first time.

UCITS registered the largest quarterly net sales since 2006. Net sales totalled EUR 148 billion, up from EUR 51 billion in the previous quarter, and all fund categories saw positive net flows.

Luxembourg was the top domicile for net inflows during the quarter with net sales of EUR 64billion, followed by Ireland, Norway, France and Spain.

ESMA launches MiFID II consultations

On 22 May, ESMA, the European Securities and Markets Authority, launched its consultation on the implementation of updated Markets in Financial Instruments Directive (MiFID II) and the Markets in Financial Instruments Regulation (MiFIR ) . 

MiFID II / MIFIR contain over 100 requirements for ESMA to develop regulatory and implementing technical standards. Accordingly, it published two papers:

• a consultation paper on MiFID/MiFIR technical advice
• a discussion paper on MiFID/MiFIR standards, which will be the basis for a further consultation paper. 

The closing date for responses to both papers is Friday 1 August. 

Steven Maijoor, ESMA Chair, called this launch "an important step in the biggest overhaul of financial markets regulation in the EU for a decade".

Launch of an ESG label for investment funds 

On 21 May, the Luxembourg Fund Labelling Agency (LuxFLAG) launched the LuxFLAG ESG Label. This label is for funds which meet specific criteria related to their respect of environment, social and governance objectives.

It is available to for all types of funds domiciled in Europe or in equivalent jurisdictions. Three asset management companies have already committed to apply for the new ESG label: OFI Asset Management, Nordea and Sparinvest. 

Speaking at the launch, Thomas Seale, Chairman of LuxFLAG, said that the ESG label will "help these funds differentiate themselves from other offerings in the market place and it will help investors make informed decisions".

Significant fund industry publications 

Notable publications in May concerning the fund industry included:.

• the UK's Financial Conduct Authority released the findings from its review of how fund charges are presented
• the 2013 report on fund processing standardisation was issued by EFAMA and SWIFT
• the Luxembourg bankers's association published its comprehensive guidance notes on FATCA
• the IMA in the UK published its fourth report on stewardship and engagement for institutional investors, asset owners and asset managers
• ALFI, the Luxembourg fund association, published two sets of guidelines on operational risk mangement, one for the UCITS framework and the other for the AIF framework, as well as a Q&A on risk management for alternative investment funds.  

_{Published on: 30 May 2014}

Fundsquare News 10 - May 2014