Asset managers to face systemic risk tests

ESMA targets fund sector

Asset managers are set to face further regulatory tests this year to determine whether they could be key contributors to systemic risk within the industry.

According to the Financial Times, European markets regulator European Securities and Markets Authority (ESMA) wants to conduct further tests in areas such as stress testing, liquidity management tools and leverage. It is thought asset managers are the new target for ESMA, having concluded the majority of work on the banking system. According to the FT, during a recent visit to London, ESMA's chairman Steven Maijoor, said: "ESMA has already flagged that this year it will assess stress testing in the fund industry. Additionally, our focus in this area is on issues such as liquidity manag...