The SEC will spend 2015 taking a closer look at risks in the money management industry, Chairwoman Mary Jo White said Thursday at an investor conference in New York.
Ms. White said Securities and Exchange Commission officials will seek more data to determine whether further “regulatory responses” are needed. The agency will also push registered funds to enhance controls “so that they are able to identify and address risks related to the composition of modern portfolios, whether those spring from the overall financial profile of a fund, such as its liquidity levels, or the nature of specific instruments, such as derivatives,” Ms. White said in the speech.
New stress-testing requirements for large investment advisers and funds mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act “while relatively novel, will help market participants and the commission better understand the potential impact of stress events,” said Ms. White, adding that agency staffers are now figuring out how to tailor rules for money managers and different types of firms.
Another focus will be on better planning for transitioning client assets when a firm closes or is unable to manage them. “If we have learned nothing else from the financial crisis, it is that we must test and plan for the worst,” Ms. White said, adding that SEC staffers are working on recommendations for those rules as well.
