2015年-FCA英国金融行为监管局_ms15_02_1_47页_1mb

Summary of the Asset Management Market Study Terms of Reference

Core Content

The Financial Conduct Authority (FCA) has launched a market study to assess the effectiveness of competition in the UK asset management sector. The study aims to determine whether institutional and retail investors are receiving value for money when purchasing asset management services, and to explore potential barriers to innovation that may hinder this.

The UK asset management sector manages approximately £6.6 trillion in assets, including £2.1 trillion in pension funds, £1.2 trillion in retail products, and £1 trillion in insurance and non-mainstream products. The sector plays a crucial role in the economy by connecting investors with companies and governments in need of capital, and by providing stewardship and oversight of investments.

Main Topics to be Explored

The study will focus on three main areas:

1. Investor Monitoring and Value for Money

   • Whether investors find it difficult to monitor asset managers and ensure they are getting value for money.

2. Role of Investment Consultants

   • Whether investment consultants create conflicts of interest by providing both advice and asset management services.

3. Cost Control and Incentives

   • Whether asset managers have the incentive and ability to control costs along the value chain.

Additionally, the study will examine how regulatory initiatives and policy reforms have affected the sector and whether they have addressed competition issues.

Key Issues and Concerns

• Barriers to Innovation: The FCA will assess whether regulatory requirements or other factors are preventing innovation that could improve outcomes for investors.
• Impact of Charges: The study will consider the impact of charges on investor returns, using examples such as the cost difference between 1.5% and 0.3% charges over a 20-year period.
• Market Concentration: The FCA will evaluate the level of market concentration, particularly in areas like Liability Driven Investment (LDI), where the top three managers may account for 90% of the market.
• Distribution and Advice: Understanding how distribution and advisory services affect the competitive landscape is essential, as these are integral to the asset management value chain.

Scope of the Market Study

• The study will cover both regulated and unregulated activities related to asset management.
• It will include a range of products and services, such as pooled funds, segregated mandates, and ancillary services.
• The FCA will also consider the role of platforms and investment consultants in the market.
• The focus will be on the areas most likely to impact end investors, and the scope may be narrowed as the study progresses.

Regulatory and Legal Context

• The study is conducted under the Financial Services and Markets Act 2000 (FSMA) powers and may also use powers from the Enterprise Act 2002 (EA02).
• The FCA may refer issues to the Competition and Markets Authority (CMA) if necessary.
• The FCA has the authority to implement a variety of interventions, including rule-making, firm-specific remedies, and market-wide solutions.

Methodology and Timeline

• The FCA will gather information from stakeholders, including asset managers, platforms, and investment consultants.
• They will host roundtables and bilateral meetings to discuss the topics outlined in the Terms of Reference.
• The FCA aims to publish an interim report in summer 2016, outlining preliminary findings and possible remedies.
• A final report is expected in early 2017.
• If competition issues are identified, the FCA may take action, including the possibility of making a Market Investigation Reference (MIR) to the CMA.

Stakeholder Engagement

• The FCA encourages stakeholders to submit their views and data by 18 December 2015.
• Submissions can be sent to Mahin Choudry, Competition Division, FCA.
• All responses will be made public unless the respondent requests otherwise.

Economic and Sector Impact

• The UK asset management sector is a major contributor to the economy, generating significant employment and tax revenue.
• The sector is not highly concentrated, with the top ten firms managing around 55% of total assets under management.
• The FCA will consider the implications of changes in the institutional market on retail investors, as many retail beneficiaries are indirectly impacted by institutional decisions.

Conclusion

The FCA is conducting this market study to ensure that competition works effectively for asset management services, with the goal of improving value for money for both institutional and retail investors. The study will take into account the current and future regulatory landscape and will explore potential structural issues and areas for improvement.