UK/EUROPE - A single European asset management market could boost the industry by at least e5bn a year, according to a new report commissioned by the UK's Investment Management Association (IMA).
In fact easier crossborder trade could produce an increase in the overall size of a pension of about 9%, or e120,000, for the average investor, said the IMA.
The report - ‘Asset Management in Europe: The Way Forward’, by the ZEW (Centre for European Economic Research, Mannheim) - examines the obstacles to greater competition in the savings market.
The report points out that despite the UCITS Directive, which was agreed 18 years ago to enable investment funds to be sold cross-border within the EU, the market is still essentially local. In most EU countries over 90% of investment funds are still supplied domestically.
Sheila Nicoll, deputy chief executive of the IMA, said: “Asset managers are keen to develop a single market for asset management – but are still coming up against lots of roadblocks.
“Commissioner [Frits] Bolkestein has said that it is like driving a Ferrari in second gear and that is exactly how it feels. The benefits for consumers of a single European market in asset management, and particularly investment funds, are enormous.”
IMA also proposes new legislation to assist crossborder mergers, slash red tape, end tax discrimination against foreign funds and bring in common standards covering infrastructure and information on fund management.
“[The proposals] fit in well with the Commission’s recent proposals to reinvigorate work on completing the internal market,” added Nicoll.
“We look forward to a debate with policymakers and our colleagues in the rest of Europe about how to go forward. In the coming weeks, we will be pressing our case at the highest levels in Brussels. We have set ourselves deadlines to review the position.”
IMA is the trade body for the UK investment management industry, representing some £2,000bn assets in the UK and over £4,600bn worldwide.
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