Íø±¬³Ô¹Ï

Home   News   Features   Interviews   Magazine Archive   Symposium   Industry Awards  
Subscribe
Íø±¬³Ô¹Ï
Leading the Way

Global Íø±¬³Ô¹Ï Finance News and Commentary
≔ Menu
Íø±¬³Ô¹Ï
Leading the Way

Global Íø±¬³Ô¹Ï Finance News and Commentary
News by section
Subscribe
⨂ Close
  1. Home
  2. Industry news
  3. ESMA: EU AIF industry is highly concentrated around few large participants
Industry news

ESMA: EU AIF industry is highly concentrated around few large participants


04 April 2018 Paris
Reporter: Jenna Lomax

Generic business image for news article
Image: Shutterstock
The EU alternative investment fund (AIF) industry is highly concentrated around a few large participants and asset classes, according to the European Íø±¬³Ô¹Ï and Markets Authority (ESMA).

ESMA, which released its latest trends, risks and vulnerabilities (TRV) report on 4 April, also found that the vast majority of European AIFs are managed cross-border using passporting rights.

The Alternative Investment Fund Directive (AIFMD) data showed that 2 percent of the EU AIF funds are above €1 billion in size, holding around 46 percent of the industry’s total net asset value (NAV).

ESMA reported that around 95 percent of EU AIFs hold below €500 million (40 percent of total NAV).

Two-thirds of the total assets managed by EU AIFMs are divided among fixed income funds, equity funds, infrastructure funds, commodity funds and other funds.

ESMA reported that fixed income AIFs hold the largest share in terms of NAV. The AIFMD data also found that repurchase agreements serve as AIFs’ primary borrowing source, while unsecured borrowing plays only a minor part.

In addition, EU hedge funds mainly rely on short-term funding liquidity, with the majority of their borrowings, not committed beyond one day.

The extensive reporting obligations introduced by the AIFMD for AIFs and their managers (AIFMs) allow national competent authorities to oversee whether AIFMs are properly addressing micro-prudential risks, and to assess the potential systemic consequences of the individual or collective AIFM activities.

ESMA stated that by providing a first analysis of the structure and main risks stemming from the AIF market, the authority’s article helps to build an operational framework for monitoring risks in the AIFM sector.

The ESMA TRV provides EU-wide evidence on the AIF market, based on end-2016 data collected under AIFMD.

AIFs include hedge funds, real estate funds, funds-of-funds, and private equity funds.
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Íø±¬³Ô¹Ï Finance Times
Advertisement
Subscribe today
Knowledge base

Explore our extensive directory to find all the essential contacts you need

Visit our directory →
Glossary terms in this article
→ Hedge
→ Liquidity

Discover definitions, explanations and related news articles in our glossary

Visit our glossary →