Posts Tagged “Claude Kremer”

EFAMA leads the asset management industry in a call for pan-European long-term savings product in closed door session at FundForum International 2010

July 2, 2020

Jean Baptiste de Franssu, President, EFAMA speaking at FundForum International 2010

Eddy Wymeersch, Chairman, CESR at FundForum International 2010

In an intense and wide ranging meeting which included those representing the regulatory view, the investment industry and investor representatives today, five key issues were debated in the new closed door session at FundForum International 2010.

The panel, moderated by Tom Brown, Partner at KPMG, consisted of Eddy Wymeersch, Chairman of CESR; Jean-Baptiste de Franssu, President of EFAMA; Consumer advocates Mick McAteer and Guillaume Prache; Marc Garvin, Chairman International Business, Treasury and Securities Services of JPMorgan as well as the members of the EFAMA President Advisory Council: Juan Alcaraz, CEO of Allfunds Bank and Santander Asset Management; Dominique Carrel-Billiard, CEO of AXA Investment Managers; Alain Dromer, CEO of Aviva Investors; Roderick Munsters, CEO of ROBECO, Martin Gilbert, CEO of Aberdeen Asset Management; Allan Polack, CEO of Nordea Savings and Asset Management; Peter De Proft, Director General of EFAMA and Claude Kremer, Vice-President of EFAMA.

First up on the agenda was the issue of long term savings and distribution in particular on the back of the report entitled Revisiting the landscape of European long-terms savings published by EFAMA at the beginning of the year.

The attendees were supportive of creating a pan-European long-term savings product which will meet the needs of the ageing population of Europe, one of the greatest challenges facing Europe today. It is the European asset management industry’s aim to provide a solution to this problem. European consumers need a product that is simple, cost effective and transparent to encourage long term savings which the investment management industry can provide. Effective distribution and advice on savings products across Europe are major challenges, from a regulatory, supervisory and commercial standpoint.

The second issue under debate was shareholder engagement, both in terms of activism and stewardship. Asset managers need to go beyond a short termist approach and engage in a long term dialogue with the companies in which they invest. The group acknowledged that it is essential to find the right balance between their fiduciary duties to their investors and their role as investors in a company, and to find proper mechanisms for effective engagement.

The third item on the agenda was the evolving supervisory framework in the EU and how it will impact on the asset management industry. ESMA, one of the three new authorities will be an independent body not comparable to the SEC, operating as a co-ordinating rather than guiding force. The aim is that will ultimately lead to a more harmonised approach in regulation across Europe.

Turning to the issue of new regulation for depositaries, the industry representatives said that the existing global custody model has served the industry and investors well but there is a legitimate argument for strengthening investor protection. The industry representatives on the panel felt that new regulation should not lead to an overhaul of a well established body of practices.

The session concluded with a look at the growing fund group of ETFs. Panellists discussed how the characteristics of these funds have an impact on existing distribution models.

Concerns about growth of hedge funds using Ucits

June 29, 2020

Claude Kremer, Chairman, ALFI speaking at FundForum International 2010

Speaking today on the rise of Newcits, Claude Kremer, chairman of Alfi, pointed out that there is no such thing as Newcits: “It is purely an imaginative term used by the press” he said. Who would have thought that the Undertaking for Collective Investments in Transferable Securities as Ucits started out, would have gone so far from those safe transferable securities. The earlier session had Manfred Schraepler, head of fund structuring at Deutsche Bank, detailing how big their business on the Ucits funds platform has grown over the eight years they have been in business.

Kremer described the Newcits phenomenon as a convergence of hedge funds and Ucits, and an opportunity for traditional offshore style hedge funds to come onshore, thereby creating a whole new market for their wares. “Is there a reason for concern?” he asked. “Is it one bridge too far?” The regulators are concerned because Ucits is a product designed primarily for retail investors. There is no doubt that Ucits based on hedge funds are popular. A recent study by Lipper numbered them at 650 with US$ 100 bn in Euros in assets.

Toby Hogbin, Director, Martin Currie speaking at FundForum International 2010

Toby Hogbin of Martin Currie said: “The Ucits franchise gives a veneer of regulation for potential investors.” He added that Ucits is now a global franchise, with 40 per cent of sales coming in from non-European domiciles. But it is a franchise that appears to offer safety in uncertain times. The growth in funds under management in Ucits style hedge funds is driven by fear and an investor need for liquidity. It is perceived that Newcits offer that and believed that risk money is going into these products.However, Peter Branner of SEB, offered a more scary scenario going forward. “I foresee a Madoff within the Ucits framework” he said.

The panel was largely agreed that, as ever, manufacturers or distributors of these products alike need to ensure that clients understand and know what they are buying.

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