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ARTICLE · 13 MARCH 2017

Illiquid Assets An Open-ended Fund

Macfarlanes LLP
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The FCA seeks stakeholder comments on its suggestions by 8 May 2017, after which it expects to publish a response later in 2017.

United KingdomFinance and Banking
Tim Cornick
Tim Cornick

Liquidity management is a topical issue in the funds world and it was thrown sharply into focus for managers of open-ended funds following the unexpected Brexit referendum result. This was particularly so for those managers of funds investing in property who were forced to suspend dealing because they could not meet redemption requests.

The FCA was proactive in engaging with such managers in the week leading up to the referendum and has since undertaken supervisory visits to gain a deeper understanding of the liquidity challenges faced in extraordinary market circumstances.

On 8 February the FCA published Discussion Paper 17/1 "Illiquid assets and open-ended investment funds" which revealed what it had learnt from the "test" provided by the referendum and its subsequent supervisory work. Whilst it was generally happy with the way in which mangers dealt with the liquidity crunch, the FCA now seeks to promote discussion on whether any additional rules or

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