27 March 2020
- 27 March 2020
The European Securities and Markets Authority (ESMA), the EU securities regulator, has today launched a public consultation on its draft guidance to address leverage risks in the Alternative Investment Fund (AIF) sector.
- The consultation is part of the ESMA response to the recommendations of the European Systemic Risk Board (ESRB) in April 2018 to address liquidity and leverage risk in investment funds.
- Steven Maijoor, Chair, said:
In situations when financial markets are under severe stress, highly leveraged alternative investment funds can further amplify systemic risk.
- Next steps
ESMA is seeking stakeholders feedback on the proposed principles to set leverage limits under Article 25 of Directive 2011/61/EU.