Some highlights from Monday’s FTfm.
Plan to ban money fund bailouts
European regulators are believed to be exploring controversial plans to ban managers of money market funds from bailing out investors if their funds suffer a loss. Although such bailouts has proved crucial for the industry, the fact that sponsors are not required to do so is thought to be destabilising in itself
‘Securities watchdogs need more powers’
The head of Iosco says rules are of little use if there are no powers of enforcement especially as the number of global financial markets is growing all the time.
Investors act on carbon control
Institutional investors, led by the CCLA, are threatening to issue shareholder resolutions at AGMs in 2013/14 if the worst performing companies do not improve efforts to reduce their carbon footprints
GCP responds to investor demand
A London-listed infrastructure fund, Gravis Capital Partners’ Infrastructure Investment, has raised £144.4m, almost double its target of £80m, in its latest fundraising.
Inflows hit high-yield bond market
Active fund managers are frequently being forced to take short-term positions in exchange traded funds to access the underlying high-yield bond market, a new report reveals, as staggering inflows into the sector spark liquidity problems. However, the rising dominance of high-yield ETFs has also meant that active managers have been able to ‘front run’ the slower moving ETFs, according to a report by S&P Capital IQ
The fraught quest for low-risk return
There is no satisfactory answer to the problem of overvaluation in the index-linked market. When market distortions unwind, the price of safe assets will fall, says John Plender
It’s plan for all to see, ESG research works
GMI Ratings downgraded BP before Deepwater Horizon, Tepco before Fukushima, AIG before the financial crisis, News Corp before the phone hacking scandal, Olympus before Michael Woodford blew the whistle, and many other companies before major negative events irretrievably destroyed shareholder wealth, writes Bob Monks, co-founder of GMI Ratings
What you can do with bad government debt
Expect some reprofiling of European debt, which might also lead to the imposition of some capital controls. John Dizard has been consulting the experts
Social media is a thorny issue
Robert Pozen thinks current regulations that prohibit or limit communications between the financial services industry and its customers are very out of date. Both investors and industry employees would benefit from a freer flow of information about funds in the social media.