Asset Management Industry: Financial Stability Update, Fall 2015

As U.S. and global regulators continue to evaluate the potential impact, if any, of the asset management industry and its products and activities on financial stability, the regulatory standards that will ultimately be applied remain in flux.

The Bottom Line

U.S. and international regulators have been refining their views as they have considered the asset management business, its role in the financial stability debate, and how it should be regulated in the future. The regulators’ initial pronouncements and studies left many experts surprised, if for no reason other than these statements and studies appeared to lack basic supporting facts and analyses. A flood of responses and analyses were submitted by the industry in the subsequent blowback. Several years later, regulators have taken a step back – or more appropriately, a sidestep – toward a more disciplined and rigorous assemblage of facts, law and careful research.

Both U.S. and global regulators have, at least temporarily, moved away from considering designation of asset managers and asset management vehicles as systemically important financial institutions (SIFIs), and instead seemed focused on industry-wide prudential regulations. At least in the United States, the dynamics of an election year will likely impact how regulators proceed with regard to these issues.

Read "Asset Management Industry: Financial Stability Update, Fall 2015."