Property suspensions spark fresh scrutiny of open-ended fund structures

Do they have the right tools to protect investors?

Last week's suspension of a number of giant open-ended property funds as they struggled to cope with post-Brexit outflows from the sector has not gone unnoticed by regulators.

Speaking last week, Bank of England (BoE) governor Mark Carney expressed concerns about "liquidity mismatches" between these funds and their underlying assets, as he warned commercial property is seen as a key risk to UK financial stability following the leave vote. Meanwhile, FCA chief Andrew Bailey said there are issues with the structure of open-ended property funds that need to be addressed, adding the regulator had been in close contact with providers during the past few days. However, this is not the first time UK regulators have expressed concerns about the underlying liquidity...