Hedge Fund association to engage with U.S. authorities
26 August 2010 London
Image: Shutterstock
Will securities lending be affected? Securities Lending Times will be reviewing the Dodd-Frank Act in an upcoming issue, however before we do, The Alternative Investment Management Association (AIMA) - the global hedge fund industry association - is to engage with U.S. policymakers and supervisors over the implementation of the Dodd-Frank Act and has set out several key areas of focus ahead of September meetings with U.S. policymakers and supervisors regarding the Dodd-Frank Act. These include the registration of hedge fund managers and the reporting of systemically relevant data in the interests of a broader financial stability assessment; how smaller managers may be impacted by the legislation; OTC derivatives; the revised 'Volcker Rule'; potential tax issues; and the goal of global regulatory consistency.
Todd Groome, Chairman of AIMA, said: "AIMA, as the global hedge fund association, has historically worked closely with U.S. and international supervisors, and we look forward to engaging with U.S. authorities in September and beyond regarding numerous issues related to the implementation of the Dodd-Frank Act, as well as its interaction with reforms in other jurisdictions.
"AIMA supports increased dialogue with supervisors, and the goal of improved trading and market transparency by the industry. That includes periodic reporting of data to supervisors so they may better assess broad market and potential systemic risks. Hedge funds do not present a systemic risk, but our industry can contribute to the analysis of systemic risk and financial stability.
"We also support OTC derivatives reform, including the introduction of central clearing. We believe central clearing of eligible contracts is a very important reform aimed at improving financial stability. However, we remain focused on certain implementation issues, such as direct access, governance and capital or margin requirements.
"From the outset, we have also called for a globally consistent and coordinated regulatory framework. Many of the measures that feature in the Dodd-Frank Act are being discussed in other jurisdictions, and it is desirable that there is a large degree of consistency in terms of approach and implementation. If that consistency is not achieved it could lead to unnecessary duplication and increased costs."
Todd Groome, Chairman of AIMA, said: "AIMA, as the global hedge fund association, has historically worked closely with U.S. and international supervisors, and we look forward to engaging with U.S. authorities in September and beyond regarding numerous issues related to the implementation of the Dodd-Frank Act, as well as its interaction with reforms in other jurisdictions.
"AIMA supports increased dialogue with supervisors, and the goal of improved trading and market transparency by the industry. That includes periodic reporting of data to supervisors so they may better assess broad market and potential systemic risks. Hedge funds do not present a systemic risk, but our industry can contribute to the analysis of systemic risk and financial stability.
"We also support OTC derivatives reform, including the introduction of central clearing. We believe central clearing of eligible contracts is a very important reform aimed at improving financial stability. However, we remain focused on certain implementation issues, such as direct access, governance and capital or margin requirements.
"From the outset, we have also called for a globally consistent and coordinated regulatory framework. Many of the measures that feature in the Dodd-Frank Act are being discussed in other jurisdictions, and it is desirable that there is a large degree of consistency in terms of approach and implementation. If that consistency is not achieved it could lead to unnecessary duplication and increased costs."
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