Publication des rapports du FSB et de l’OICV sur la gestion de la liquidité des fonds ouverts

Back in Septembr 2023, the AFG responded to corresponding consultations by the FSB and IOSCO on open-ended fund liquidity management, of which both organizations now published their respective final reports.
These comprehensive reports reflect a concerted effort to address challenges related to liquidity management in open-end funds. The FSB’s focus on harmonizing the use of anti-dilution tools is particularly noteworthy, aiming to enhance the overall resilience and stability of the financial system. Furthermore, the detailed categorization of assets proposed in the FSB report provides a structured approach for funds contemplating daily liquidity.
The IOSCO report, complementing the FSB’s initiatives, contributes by delving into specific aspects such as calibration, usage, and disclosure requirements for anti-dilution tools. This collaborative approach between FSB and IOSCO signifies a unified commitment to promoting transparency and effective risk management within the open-end fund industry.
Designated as the official source, the FSB and IOSCO reports serve as critical guidelines for financial regulatory analysts. The insights provided in these reports are instrumental for professionals navigating the evolving landscape of liquidity management in the financial sector. The coordination between the FSB and IOSCO emphasizes the importance of international collaboration in addressing complex financial challenges, ensuring a robust and well-regulated environment for open-end funds.
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In its response to the FSB consultation on open-ended fund liquidity, the AFG is emphasizing dynamic liquidity assessment over fixed thresholds to avoid procyclical effects. It advocates continuous monitoring of asset valuation and portfolio liquidity, following the European model of asset eligibility. The AFG supports revised FSB recommendations on anti-dilution tools and urges international guidance on quantity-based tools. Emphasizing asset manager discretion, it recommends longer notice periods for less liquid assets and consistency between liquidity levels and redemption rules. The AFG stresses internal controls for liquidity tools, peer reviews, and disclosure to investors while maintaining confidentiality. It highlights measuring liquidity on both asset and liability sides, along with stress testing. Lastly, it calls for increased scrutiny in the non-regulated fund sector. The response addresses nuanced aspects of liquidity management for open-ended funds.
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In its response to IOSCO’s consultation on liquidity management tools, the AFG stresses integrating anti-dilution LMTs into existing frameworks, emphasizing understanding liability for accurate redemption estimates. The AFG supports including LMTs in daily risk management for specific funds, advocating for flexible activation and providing insights on swing pricing calculations. On anti-dilution tool calibration, it backs market impact inclusion and advocates a pragmatic approach, discussing benefits and considerations of a tiered approach to liquidity cost attribution. Governance-wise, it emphasizes judgment-based oversight, avoiding trigger effects, and proposes a principle-based approach for investor disclosure. The AFG recognizes barriers to LMT implementation, citing market capacity, and urges specific recommendations for unit-linked processes in retail distribution.