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Author: Viktoria Baklanova Publisher: ISBN: Category : Languages : en Pages :
Book Description
On 4 September 2013 the European Commission released a proposal that seeks to restructure the entire European money market fund (MMF) industry. This article outlines the premises of the proposal and discusses concerns related to the most controversial provisions. We believe that economically unfeasible requirements for constant net asset value (CNAV) MMFs will result in the exit of these funds. We believe that the primary objective of financial market stability cannot be achieved by eliminating CNAV MMFs in favour of variable net asset value (VNAV) MMFs.There is simply no evidence that VNAV MMFs are immune to runs. New systemic risk will emerge as a result. Other types of investment products will proliferate, including private liquidity funds, which the existing EU regulation is not addressing. The focus of the proposal is misplaced. Runs in a single fund, whether CNAV or VNAV, due to a credit event should not be the primary regulatory concern. Investing is always a risky business and regulation ought to empower investors with complete information to adequately manage these risks. We recognise that any regulatory rules will be imperfect. The never-ending search for the most efficient allocation of resources will drive investors away should the post-reform MMF structure prove too costly. The solution can be found in the balance between long-term funding needs of the real economy and the utility of these funds.
Author: Viktoria Baklanova Publisher: ISBN: Category : Languages : en Pages :
Book Description
On 4 September 2013 the European Commission released a proposal that seeks to restructure the entire European money market fund (MMF) industry. This article outlines the premises of the proposal and discusses concerns related to the most controversial provisions. We believe that economically unfeasible requirements for constant net asset value (CNAV) MMFs will result in the exit of these funds. We believe that the primary objective of financial market stability cannot be achieved by eliminating CNAV MMFs in favour of variable net asset value (VNAV) MMFs.There is simply no evidence that VNAV MMFs are immune to runs. New systemic risk will emerge as a result. Other types of investment products will proliferate, including private liquidity funds, which the existing EU regulation is not addressing. The focus of the proposal is misplaced. Runs in a single fund, whether CNAV or VNAV, due to a credit event should not be the primary regulatory concern. Investing is always a risky business and regulation ought to empower investors with complete information to adequately manage these risks. We recognise that any regulatory rules will be imperfect. The never-ending search for the most efficient allocation of resources will drive investors away should the post-reform MMF structure prove too costly. The solution can be found in the balance between long-term funding needs of the real economy and the utility of these funds.
Author: Laura-Dona Capotă Publisher: ISBN: 9789289953856 Category : Languages : en Pages : 0
Book Description
The market turmoil in March 2020 highlighted key vulnerabilities in the EU money market fund (MMF) sector. This paper assesses the effectiveness of the EU's regulatory framework from a financial stability perspective, based on a panel analysis of EU MMFs at a daily frequency. First, we find that investment in private debt assets exposes MMFs to liquidity risk. Second, we find that low volatility net asset value (LVNAV) funds, which invest in non-public debt assets while offering a stable NAV, face higher redemptions than other fund types. The risk of breaching the regulatory NAV limit may have incentivised outflows among some LVNAV investors in March 2020. Third, MMFs with lower levels of liquidity buffers use their buffers less than other funds, suggesting low levels of buffer usability in stress periods. Our findings suggest fragility in the EU MMF sector and call for a strengthened regulatory framework of private debt MMFs.
Author: Danny Busch Publisher: Oxford Eu Financial Regulation ISBN: 9780198813392 Category : Law Languages : en Pages : 0
Book Description
Capital Markets Union in Europe' analyses the legal and economic aspects of the plans for a Capital Markets Union (CMU) in Europe, which will have a major impact on financial markets and institutions both in the region and beyond.
Author: Latoya Brown Publisher: ISBN: Category : Languages : en Pages : 25
Book Description
The recent financial crisis challenged long held perceptions of money market funds (MMF) as stable and highly liquid instruments. Regulators in the United States and in Europe now seek to impose additional rules on MMFs to buttress the funds' ability to sustain runs. In the United States, the debate is drawing even more media attention as the question of which regulatory body should lead the way -- the Securities and Exchange Commission, the Treasury Department, or the Financial Stability Oversight Council -- has taken interesting twists and turns. This article examines primary reform options being proposed in the United States, and concludes that additional rules that were implemented by the SEC in 2010 have adequately strengthened the perceived weaknesses of the MMF industry, which has for the most part proven itself reliable. If, after further in depth study and analysis, regulators conclude that additional regulations are advisable, the proposal of a capital buffer is the most promising reform option. The paper's ultimate conclusion is informed by the experiences of the European fund industry which, provide invaluable lessons for U.S. regulators on what reform options are viable.
Author: Niamh Moloney Publisher: Oxford University Press ISBN: 0198844875 Category : Languages : en Pages : 993
Book Description
Over the decade or so since the global financial crisis rocked EU financial markets and led to wide-ranging reforms, EU securities and financial markets regulation has continued to evolve. The legislative framework has been refined and administrative rulemaking has expanded. Alongside, the Capital Markets Union agenda has developed, the UK has left the EU, and ESMA has emerged as a decisive influence on EU financial markets governance. All these developments, as well as the Covid-19 pandemic, have shaped the regulatory landscape and how supervision is organized. EU Securities and Financial Markets Regulation provides a comprehensive, critical, and contextual account of the intricate rulebook that governs EU financial markets and its supporting institutional arrangements. It is framed by an assessment of how the regime has evolved over the decade or so since the global financial crisis and considers, among other matters, the post-crisis reforms to key legislative measures, the massive expansion of administrative rulemaking and of soft law, the Capital Markets Union agenda, the development of supervisory convergence as the means for organizing pan-EU supervision, and ESMA's role in EU financial markets governance. Its coverage extends from capital-raising and the Prospectus Regulation to financial market intermediation and the MiFID II/MiFIR and IFD/IFR regimes, to the new regulatory regimes adopted since the global financial crisis (including for benchmarks and their administrators), to retail market regulation and the PRIIPs Regulation, and on to the EU's third country regime and the implications of the UK's departure from the EU. This is the fourth edition of the highly successful and authoritative monograph first published as EC Securities Regulation. Heavily revised from the third edition to reflect developments since the global financial crisis, it adopts the in-depth contextual and analytical approach of earlier editions and so considers the market, political, institutional, and international context of the regulatory and supervisory regime.
Author: Viktoria Baklanova Publisher: ISBN: Category : Languages : en Pages :
Book Description
This Article presents European money market funds from multiple dimensions and shows the diversity of these funds -- a diversity rooted in the historical developments of diverse European financial markets. The events of the financial crisis and liquidity squeeze confronting European money market funds in the fall of 2007 have brought money markets to the fore of Europe's regulatory agenda. The fragmentation of the European money market fund industry is not only a source of confusion for investors, but also a significant impediment to developing a single market for financial services. The near future of the European money market fund industry rests on the outcomes of two divergent trends: (1) harmonization of investment products toward convergence of investment; and (2) regulatory practices and a desire for product differentiation driven by the local nature of collective investments -- especially with regard to retail investors' preferences. These trends underscore two transformations related to the development of money market funds in Europe: (1) the market practices that exist de facto to their capture and replication de jure; and (2) de jure ideals of fair rules that encourage further and deeper de facto market developments. These transformations from de facto to de jure and from de jure to de facto present a continuous isomorphic dynamic that if balanced properly can result in both the creation of new products under fair rules of transparency that drive new and more resilient markets. At the ground level, these trends will be shaped by the costs and benefits they present for asset managers and investors seeking optimal efficiency in the contest between national laws, including applicable tax regulation. Moreover, European sovereign debt and the on-going problem of high-risk political dis-resolution have profound consequences for money market funds in the U.S. and Europe. These unquantifiable, intangible risks mark major unknowns for the future state of Europe and, in turn, the continued existence and development of the money market fund sector.
Author: Publisher: ISBN: 9789282366660 Category : Languages : en Pages : 50
Book Description
This study was requested by the European Parliament's Committee on Economic and Monetary Affairs (ECON), as part of Parliament's general commitment to improving the quality of EU legislation, and in particular its undertaking to carry out impact assessments of its own substantive amendments when it considers it appropriate and necessary for the legislative process. The study concludes that the four substantive amendments in question, which are under consideration in the context of the ECON Committee's draft report on the Commission proposal on Money Market Funds (MMFs), would retain the effect of transforming the considerable majority of the Constant Net Asset Value (CNAV) MMF market in Europe. There would be some, but only limited, take-up of the proposed Retail CNAV or EU Public Debt CNAV Money Market Funds. Most of the funds currently invested in Constant Net Asset Value MMFs would move to either Variable Net Asset Value (VNAV) MMFs or shortterm bank deposits. To some extent, the features of Constant Net Asset Value MMFs which are attractive to investors would be duplicated in Variable Net Asset Value MMFs, but, equally, the same concerns over systemic risk might also be replicated.
Author: Armin von Bogdandy Publisher: Springer Nature ISBN: 366262317X Category : Law Languages : en Pages : 478
Book Description
This open access book deals with Article 7 TEU measures, court proceedings, financial sanctions and the EU Rule of Law Framework to protect EU values with a particular focus on checks and balances in EU Member States. It analyses substantive standards, powers, procedures as well as the consequences and implications of the various instruments. It combines the analysis of the European level, be it the EU or the Council of Europe, with that of the national level, in particular in Hungary and Poland. The LM judgment of the European Court of Justice is made subject to detailed scrutiny.
Author: Viktoria Baklanova
Author: Viktoria Baklanova
Author: Laura-Dona Capotă
Author: Danny Busch
Author: 
Author: Latoya Brown
Author: Niamh Moloney
Author: Viktoria Baklanova
Author: 
Author: Armin von Bogdandy
Author: United States. Securities and Exchange Commission