Asset Management Bulletin April 2018

Insights

Asset Management Bulletin

April 2018

The Deloitte Asset Management Bulletin delivers you our latest updates and insights on industry and regulatory developments. We hope you find this edition useful and please contact us if you have any queries.

Impact on European ETFs - Asset Management Regulation

Last year Exchange Traded Funds (“ETFs”) and products listed in Europe hit a record high. In 2017 assets invested in European-listed ETFs and products reached $802bn (*ETFGI; 2017). In this article we will explore, what we believe could be the impact of some of the current asset management regulation on the growing European ETF industry.

CP 119 - Central Bank of Ireland Consultation Paper

On the 29th of March 2018 the Central Bank of Ireland (“CBI”) issued a Consultation Paper ("CP119") suggesting amendments to the CBI UCITS Regulations, the Irish regulatory framework for UCITS.

The CBI invites all stakeholders to provide comments on the proposed changes in the consultation by the 29th of June 2018.

The consultation is divided into 4 sections with a schedule included which contains the draft amending and consolidating Central Bank UCITS Regulations.

Brexit: Where to Next? - Deputy Governor Ed Sibley

Ed Sibley, the Deputy Governor of the Central Bank of Ireland (CBI), spoke on wide-ranging Brexit issues on the 12th of April. He discussed the potential effect of Brexit on the Irish economy in financial services (FS), the effect of Brexit on FS firms (both those currently supervised by the bank and those seeking to relocate business here) and an overview of the effect of Brexit on the future regulatory framework in the EU, and why any future divergence of regulatory frameworks will be problematic. Consistent with the ECB view, the CBI still expects firms to continue to prepare for all possible scenarios, including the prospect of a “hard Brexit” in March 2019.

EU Commission notice on the withdrawal of the UK and EU rules in the field of asset management

On 8 February 2018 the EU Commission released a number of “Notices to Stakeholders” in relation to Brexit. These notices covered a wide range of sectors, including investment managers and MiFID firms, both of which will be of interest to asset managers in the EU.

Here, we highlight some of the potential implications of these notices for both UK and EU27 asset managers and areas that firms should be considering as part of their Brexit planning.

Derivatives trading under MiFID II: data, reporting and optimisation

Almost a decade ago at the 2009 Pittsburgh Summit, G20 Leaders committed to reform the OTC derivatives markets with the objective of reducing systemic risks, improving transparency and protecting investors against market abuse.i To fulfil this commitment in the EU, MiFID II introduced specific requirements to the derivatives markets in order to bring more trading onto venues and increase the level of price transparency in these financial instruments as of 3 January this year.ii MiFID II also significantly enhanced the transaction reporting regime, designed to provide information to enable regulators’ monitoring and detection of market abuse. As a consequence firms subject to MiFID II have to report much more information about their derivative transactions.

Revenue from Contracts with Customers — A guide to IFRS 15

This detailed guide is intended to assist preparers and users of financial statements to understand the impact of IFRS 15 and includes a high-level executive summary of the new requirements, followed by a specific focus on the important issues and choices available for entities on transition to the new Standard. More specifically, the detailed guide covers:

  • all of the requirements of IFRS 15, supplemented by interpretations and examples to give clarity to those requirements;
  • pointers regarding practical issues that are likely to arise;
  • illustrative disclosures for entities that have adopted IFRS 15;
  • and a comparison with US Generally Accepted Accounting Principles (US GAAP).
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