AIMA calls for regulatory reforms to support nonbank lending

London: The European Commission must prioritise non-bank finance and deeper capital markets as part of its regulatory review, according to the Alternative Investment Management Association (AIMA).

AIMA made the comments in its response to the European Commission’s Call for Evidence on the EU regulatory framework for financial services, published in September 2015.

In its response, AIMA explains that capital market financing is more long-term and transparent, encourages greater innovation and discipline, which leads to better allocation of resources and economic growth.

However, regulatory barriers still prevent capital markets and non-banking finance from developing further in the EU.

AIMA makes the case that rules should allow greater asset managers’ participation in securitisations in order to support the supply of finance to small and medium-sized enterprises (SMEs). AIMA also argues that greater holding of financial assets by institutions and investors that can bear risk without the need for public support - such as investment funds - will improve financial stability.

The response addresses a number of other areas where AIMA believes that existing regulation is not achieving its intended policy objectives, highlighting:

·         The need to consider carefully the reform of market infrastructure to support liquidity as agreed standards are implemented;

·         The need to look again at regulatory reporting to ensure that supervisors are collecting the right data in the most effective way possible;

·         The importance of finalising the EU internal market in fund distribution and opening this market to third country funds; and

·         The need to review public short-selling disclosure requirements which has hurt equity market liquidity.

Jack Inglis, CEO of AIMA, said: “We recognise that most of the regulatory measures introduced since the financial crisis were intended to address key policy concerns and market failures. Our members welcome the opportunity to be part of the review and evaluation of this new regulatory framework in order to ensure that the policy objectives are being met and, if not, to adjust the structure where necessary.”

AIMA’s response to the Call for Evidence is available here.

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For media enquiries, please contact:

Dominic Tonner, Director, Global Head of Communications, AIMA

Tel: +44 20 7822 8380

Email: dtonner@aima.org

Laura Brooks, Associate, Communications, AIMA

Tel: +44 (0)20 7822 8380

Email: lbrooks@aima.org

About AIMA

The Alternative Investment Management Association (AIMA) has over 1,700 corporate members, and over 10,000 individual contacts, in over 50 countries. Members include hedge fund managers and other alternative asset managers, fund of funds managers, prime brokers, legal and accounting firms, investors, fund administrators and independent fund directors.

AIMA’s manager members collectively manage more than $1.5 trillion in assets. All AIMA members benefit from AIMA’s active influence in policy development, its leadership in industry initiatives, including education and sound practice manuals, and its excellent reputation with regulators worldwide.

AIMA is a dynamic organisation that reflects its members’ interests and provides them with a vibrant global network. AIMA is committed to developing industry skills and education standards and is a co-founder of the Chartered Alternative Investment Analyst designation (CAIA) – the industry’s first and only specialised educational standard for alternative investment specialists.

For further information, please visit AIMA’s website, www.aima.org.