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of securities and exchange commission Created by (SEC) correction to form PFa confidential reporting form from an SEC registered investment advisor to a private fund.
These changes are conjunction with Commodity Futures Trading Commission (CFTC). Financial Stability Oversight CouncilFSOC’s ability to monitor and assess systemic risk, the SEC said Thursday (February 8). press release.
“These amendments to Form PF will strengthen the Commission and FSOC’s understanding of the potential systemic risks posed not only by the private funds industry, but also by the industry and its individual participants,” said the SEC Chairman. says. Gary Gensler said in a release. “Additionally, this adoption also strengthens our investor protection efforts.”
Form PF was created after the 2008 financial crisis and is designed to provide regulators with important information about the internal workings of financial institutions. private funds, which helps the SEC assess risk. The SEC has stated in the past that the private funds industry has evolved since the form was created.
One of the key changes introduced in the amendments announced Thursday is increased reporting requirements for large hedge fund advisors, according to the release. These enhancements include investment exposure, debt and counterparty exposure, impact of market factors, currency exposure, sales, country and industry exposure, centrally cleared counterparty reporting, risk metrics, investment performance by strategy, and portfolio liquidity. , including a wide range of areas such as financing. Investor liquidity.
These amendments will provide regulators with a more comprehensive understanding of hedge fund operations and strategies, thereby improving data quality and comparability, the release states.
According to the release, the proposed amendments also require disclosure of additional basic information about advisers and the private funds they advise. This includes identifying information, assets under management, withdrawal and redemption rights, total asset value and net asset value, inflows and outflows, base currency, borrowing and creditor type, fair value hierarchy, beneficial ownership and fund performance. will appear.
These amendments will help identify trends that could potentially create systemic risk by providing deeper insight into private fund operations and strategies, the release said. Additionally, we aim to improve data quality and comparability and reduce reporting errors.
The amendments also focus on obtaining more detailed information about the investment strategies employed by hedge funds, counterparty exposures, trading and clearing mechanisms, according to the release.
This additional transparency will give regulators a deeper understanding of hedge fund operations and strategies and help identify trends and potential risks, the release said. At the same time, duplicate questions were removed to streamline reporting and improve data quality and comparability.
The amendments to Form PF will become effective one year after publication in the Federal Register, according to the release.
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