Monday, 22 December 2014
Last updated 5 hours ago
Jul 22 2010 | 1:18pm ET
Hedge fund registration and limits on banks’ participation in the alternative investments industry are both now the law of the land. President Barack Obama yesterday signed the most sweeping U.S. financial regulation reform since the Great Depression.
“I proposed a set of reforms to empower consumers and investors, to bring the shadowy deals that caused this crisis into the light of day, and to put a stop to taxpayer bailouts once and for all,” Obama said at the bill-signing ceremony, held at the Ronald Reagan Building in Washington, D.C.
“Because of this law, the American people will never again be asked to foot the bill for Wall Street’s mistakes,” the president added.
The alternative investments provisions are a very small part of the 2,300-page law, which creates a new consumer financial protection agency and gives regulators the authority to wind-down institutions that present a systemic risk to the economy. But what provisions there are will certainly have an effect on the way hedge funds and private equity firms do business.
For one, both hedge funds and p.e. firms—those with more than $150 million in assets, anyway—will have to register with the Securities and Exchange Commission. They’ll also have to disclose more information to the regulator and will be subject to SEC audits.
The bill also includes a watered-down version of the Volcker rule, strictly limiting to 3% the amount of its capital a bank can invest in hedge funds and private equity funds.
Still unclear is if or how the new financial super-regulator—the Financial Stability Oversight Council, which includes representatives of the SEC, Federal Reserve and Treasury Dept.—will affect hedge funds or private equity firms. That body has been given authority over firms deemed systemically relevant, but it is not clear whether any hedge funds would fall under that definition.
Dec 1 2014 | 10:21am ET
As 2014 winds down, Northern Trust Hedge Fund Services executives took some time to share their outlook on trends facing the industry in 2015. Read more…
Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.