Central Bank of Ireland yesterday suggested regulatory reforms on money market funds (MMFs) should focus on imposing tighter rules on liquidity, changing the practice of implicit support from sponsors/managers with formalized requirements and possibly the introduction of redemption gates, and to reduce the need for taxpayer support.
The suggestions were part of a speech delivered by Irish Central Bank Deputy Governor Matthew Elderfield, who confirmed proposals for changes to the domestic funds framework in light of the implementation of the Alternative Investment Fund Managers Directive (AIFMD) in Ireland.
In addition to its stance on MMFs, the regulator confirmed the following key points: the central bank would consult with the industry on the proposal to remove the promoter regime for Qualifying Investor Funds (QIFs); the central bank would consider the creation a new type of investment fund that complies in full with the AIFMD, without the imposition of any further domestic requirements.
The central bank will review the uptake of the funds industrys Voluntary Corporate Governance Code for Management Companies and Collective Investment Schemes at the same time it reviews the implementation of its own statutory banking and insurance company corporate governance code next year. It will also review its funds authorization process in an effort to continuously improve efficiency and to increase electronic filings and automated workflow processes.
(JDC)