NORTHERN TRUST
Northern Trust Survey: Fund Managers See Regulatory Reform as Single Largest Driver in the Evolution of the UK Fund Industry
Majority of Investors continue to see Regulatory Implementation as a Cost Overhead
LONDON, June 30, 2015 -
More than 45 percent of fund managers, prospective clients and consultants attending a Northern Trust (Nasdaq: NTRS) seminar on regulation, hosted by its Depositary Services business in London this month, said they believed ongoing regulatory reform was the single largest driver in the evolution of the UK funds industry.
"The pace of European regulatory change is set to continue and, now more than ever, there is a greater need for aligned solutions to meet both the challenges and opportunities brought by regulation," said Toby Glaysher, head of Global Fund Services for Europe, Middle East and Africa at Northern Trust. "At Northern Trust we are dedicated to helping our clients stay ahead of, and take advantage of, any opportunity resulting from regulatory change."
Whilst the survey demonstrated regulatory reform is the driver in the evolution of the UK funds industry, the majority of respondents (74 percent) believed their investors viewed regulatory implementation as a cost overhead with limited value, with only 26 percent citing that investors valued the added protection, transparency and clarity they get as part of increased regulation.
These findings echoed a previous survey conducted by Northern Trust in 2013 where two thirds (66 percent) of fund managers said they saw the Alternative Investment Fund Managers Directive (AIFMD) primarily as a compliance exercise, despite the creation of a pan-European passporting regime which aims to make distribution easier and therefore benefit investors.
"It comes as no surprise that the complexity of regulation can sometimes cause the overall benefits to become unclear," said Darren Banks, head of Northern Trust Depositary Services for the UK. "In today's regulatory environment, we work with our clients to help them understand and navigate the changing regulatory landscape. The UK is Europe's leading market for fund management and it's important to ensure the market remains competitive and our clients are able to take advantage of new opportunities available to them."
The UK Authorised Contractual Scheme (ACS) is the first UK authorized tax-transparent fund, presenting a range of opportunities for asset managers to meet the challenges of cost pressures, distribution and regulatory change. More than half (58 percent) of respondents saw cost efficiency as the biggest benefit of launching an ACS. The findings also revealed that the majority (56 percent) of respondents thought that their new fund launches would trend towards UK onshore, ensuring the UK market remained competitive.
The Northern Trust Depositary Services event, 'Harness the Benefits from Regulatory and Market Change', was attended by more than 70 fund managers, prospective clients and consultants in June 2015. Northern Trust's Global Fund Services business provides depositary, custody, fund administration, investment operations outsourcing, and regulatory solutions to investment managers across the globe and across the spectrum of asset classes. Northern Trust offers depositary services from the United Kingdom, The Netherlands, Ireland, Luxembourg and Guernsey.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has offices in the United States in 19 states and Washington, D.C., and 20 international locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of March 31, 2015, Northern Trust had assets under custody of US$6.1 trillion, and assets under management of US$960.1 billion. For 125 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit northerntrust.com or follow us on Twitter @NorthernTrust.
Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S.http://www.northerntrust.com/disclosures
"The pace of European regulatory change is set to continue and, now more than ever, there is a greater need for aligned solutions to meet both the challenges and opportunities brought by regulation," said Toby Glaysher, head of Global Fund Services for Europe, Middle East and Africa at Northern Trust. "At Northern Trust we are dedicated to helping our clients stay ahead of, and take advantage of, any opportunity resulting from regulatory change."
Whilst the survey demonstrated regulatory reform is the driver in the evolution of the UK funds industry, the majority of respondents (74 percent) believed their investors viewed regulatory implementation as a cost overhead with limited value, with only 26 percent citing that investors valued the added protection, transparency and clarity they get as part of increased regulation.
These findings echoed a previous survey conducted by Northern Trust in 2013 where two thirds (66 percent) of fund managers said they saw the Alternative Investment Fund Managers Directive (AIFMD) primarily as a compliance exercise, despite the creation of a pan-European passporting regime which aims to make distribution easier and therefore benefit investors.
"It comes as no surprise that the complexity of regulation can sometimes cause the overall benefits to become unclear," said Darren Banks, head of Northern Trust Depositary Services for the UK. "In today's regulatory environment, we work with our clients to help them understand and navigate the changing regulatory landscape. The UK is Europe's leading market for fund management and it's important to ensure the market remains competitive and our clients are able to take advantage of new opportunities available to them."
The UK Authorised Contractual Scheme (ACS) is the first UK authorized tax-transparent fund, presenting a range of opportunities for asset managers to meet the challenges of cost pressures, distribution and regulatory change. More than half (58 percent) of respondents saw cost efficiency as the biggest benefit of launching an ACS. The findings also revealed that the majority (56 percent) of respondents thought that their new fund launches would trend towards UK onshore, ensuring the UK market remained competitive.
The Northern Trust Depositary Services event, 'Harness the Benefits from Regulatory and Market Change', was attended by more than 70 fund managers, prospective clients and consultants in June 2015. Northern Trust's Global Fund Services business provides depositary, custody, fund administration, investment operations outsourcing, and regulatory solutions to investment managers across the globe and across the spectrum of asset classes. Northern Trust offers depositary services from the United Kingdom, The Netherlands, Ireland, Luxembourg and Guernsey.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has offices in the United States in 19 states and Washington, D.C., and 20 international locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of March 31, 2015, Northern Trust had assets under custody of US$6.1 trillion, and assets under management of US$960.1 billion. For 125 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit northerntrust.com or follow us on Twitter @NorthernTrust.
Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S.http://www.northerntrust.com/disclosures
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