Italy - Just a quarter of Italian asset managers are prepared for the imminent introduction of new governance rules, research by BC Dexia reveals.
A survey of 41 asset managers found just 26% were fully prepared for the new rules, which were announced by the Bank of Italy last year and take effect at the end of this month.
Some 42% said they had only just begun to assess the impact of the new guidelines despite the looming deadline, while just 27% felt they had a good understanding of the requirements and implications of the measures.
The new measures aim to defend investor interests by giving operational autonomy to investment companies belonging to larger financial groups. They will be required to have independent control of their human, technological and financial resources and to conduct independent valuations of group financial products before offering them to clients.
Asset managers will also have to improve governance and transparency with more independent non-executive directors on their boards and by disclosing potential conflicts of interest with their parent companies.
The survey found 71% of respondents expected the new Italian regulations to lead them to outsource more of their non-core activities, while two-thirds thought the new rules would force them to improve their capital adequacy positions (66%) and their risk management and transparency processes (64%).
Half of all asset managers who responded said they had already strengthened their risk management processes this year, citing pressure from investors for a safer approach to risk as the key driver (68%).
Similarly, 69% of respondents said they intended to boost transparency in the next 12 months to provide clients with more detail on fund pricing structures and with greater comparison of the costs, risks and liquidity of their investments.
RBC Dexia Italy managing director Paride Amiotti, said: "The results of our survey reveal the profound changes that the Italian asset management market is undergoing due to the effects of the global financial crisis and extensive new regulation.
"The sector is at a turning point which calls for careful preparation and a renewed focus on risk management and transparency processes."
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