Asset Management in the EU: Which way forward?

Session 1. Overcoming market fragmentation in the EU

The European asset management industry has witnessed a solid growth in recent years, reaching an estimated €19 trillion in assets under management (AuM) at the end of 2014, divided almost equally between discretionary mandates (largely serving institutional investors) and investment funds. Notwithstanding the significant steps taken in the past decade (UCITS, AIFMD, PRIPS and KIID), the European asset management sector remains highly fragmented, resulting in a sub-optimal size of funds and higher costs for investors. Much more needs to be done in order to achieve a truly pan-European market that is competitive, attractive and transparent vis-á-vis its investors (in particular the retail segment). This is also one of the priorities listed in the Commission’s Action Plan on Building a Capital Markets Union, but is awaiting further clarification.

Session 2. Business and regulatory challenges for the asset management industry

The growth of the asset management sector has directed policy-makers’ attention towards the industry’s business model and the various risks involved, including risks to the system, risks to individual institutions and risks faced by clients. As dealer/investment banks withdraw from fundamental areas of the financial system, such as securities borrowing/lending and the provision of market liquidity, the asset management industry is expected to respond and potentially even to change the way in which financial markets work. Asset managers are also facing unprecedented challenges in meeting investors' ever-rising expectations against a prolonged low-yield environment. At a systemic risk level, the understanding of the interconnectedness of asset management activities with the rest of the financial system is still developing. This may result in a revision of the current prudential framework.

Event is over