The FCA, together with the Bank of England, has opened a survey on the liquidity mismatch in open-ended funds. The FCA’s announcement of the launch of this survey reads as follows:
“In Q4 2019, the Financial Policy Committee (FPC) judged that the mismatch between redemption terms and the liquidity of some funds’ assets could become a systemic risk. It said there should be greater consistency between these, with specific focus on 3 principles: measures of liquidity, pricing, and redemption notice period.
The review will carefully consider how a framework around these principles could be designed.
As part of our ongoing joint review with the Bank, the FPC supported an initial data collection survey in Q1 2020. This survey was postponed in March due to the coronavirus (Covid-19) pandemic, however, the FPC recently supported resuming this work.
This is a voluntary exercise and the data will provide an important element for the joint review. Asset managers included in this survey are being asked to respond to the questions on a best-effort basis by 30 September 2020.”