Banking regulators, at least one of the SEC's
commissioners wants you to keep your failed regulatory styles away from fundsters and other asset managers.
In his keynote address this morning at the Investment Company Institute's (ICI's
) and Federal Bar Association's 2015 Mutual Funds and Investment Management Conference
at the JW Marriott Desert Springs resort in Palm Desert, California, Securities and Exchange Commission commissioner Michael Piwowar
pushed back against the desire of folks at the Fed, the FSOC (Financial Stability Oversight Council), and others to impose bank-like regulations on asset managers and other non-bank financial institutions through the use of the ominous "systemically important" label. Piwowar's words of warning followed ICI's own David Blass making similar remarks
in his opening remarks before Piwowar took the stage.
He dismissed the "false narrative" that somehow asset management products and other parts of the so-called "shadow banking sector" were one of the causes of the 2008 financial crisis, and he said that "the track record of prudential regulators [as the would-be risk-minimizing banking regulators style themselves] ... leaves much to be desired," pointing to the recurrence of banking crises around the globe and throughout history. He accused the FSOC and FSB of "trying to rationalize" their attempts to bring asset managers under their purview.
Piwowar, himself a PhD economist, did declare his support for a current SEC initiative to review current disclosure requirements and for revisiting provisions that (under special circumstances) allow mutual funds' boards to limit redemptions (similar to relief extended to money market mutual funds in the wake of the financial crisis).
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