On April 15, 2024 , CONSOB (“National Commission for Companies and the Stock Exchange”) published on its website a press release jointly adopted with the Spanish, French and Austrian Supervisory Authorities, Comisión Nacional del Mercado de Valores (CNMV – Spain), the Autorité des marchés financiers (AMF – France) and the Finanzmarktaufsicht (FMA – Austria), concerning the macroprudential approach to asset management in view of the upcoming consultation that the European Commission will hold on the matter.
With the press release, the Authorities addressed the risks arising from nonbank financial intermediation, underlining that the share of such risks in the global financial system has increased, with potential negative effects that these risks may generate for the economy.
The Supervisory Authorities emphasize that the necessary regulations to address the risks of asset management should take into account their specific characteristics. In particular, the Authorities intend to prioritize the characteristics of asset management that generate excessive price volatility and liquidity stress.
In this regard, the Authorities have identified the following five priorities:
- short and medium term activities:
- Ensure ample availability and increased use of liquidity management tools in all types of open-end funds;
- Prohibit the amortized cost accounting of money-market mutual funds, considered detrimental to financial stability;
- Implement systematic stress tests aimed at a better understanding of the vulnerabilities of each group of asset management and its interconnections with other participants in the financial system;
- long term activities:
- Introduce a truly consolidated supervisory approach for large cross-border asset management groups;
- Establish an integrated data hub shared by the market supervisory authorities and central banks, that meets the needs of both, daily supervision and stress-test exercises.