OFR_2016_Financial-Stability-Report
OFR_2016_Financial-Stability-Report
OFR_2016_Financial-Stability-Report
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The U.S. Census Bureau surveys public pension funds quarterly and<br />
annually. Aggregated data are available through data providers. But public<br />
pension funds do not have a standardized reporting framework. Better<br />
alignment of reporting would improve visibility into both solvency risks<br />
and asset allocation shifts that could affect financial markets.<br />
Mutual Funds<br />
Regulators need visibility into investment activities across entities. Asset<br />
management has been replacing banking in some areas of financial intermediation<br />
for years.<br />
In an April <strong>2016</strong> public update, the <strong>Financial</strong> <strong>Stability</strong> Oversight<br />
Council outlined some financial stability concerns that asset management<br />
products and activities may introduce. The FSOC’s review of liquidity and<br />
redemption risks focused on pooled investment vehicles in which investor<br />
redemption rights and underlying asset liquidity may not match (see FSOC,<br />
<strong>2016</strong>b). The FSOC continues to study these risks, as well as risks that could<br />
arise from leverage, operational functions, securities lending, and resolvability<br />
and transition planning (see FSOC, <strong>2016</strong>a; FSOC, <strong>2016</strong>b).<br />
Data on asset management activities have improved in recent years. The<br />
SEC now requires standardized and structured reporting for money market<br />
funds. The Office of the Comptroller of the Currency (OCC) has similar<br />
rules for short-term investment funds at banks and thrifts that it regulates.<br />
But structured data are not collected on mutual funds and other investment<br />
companies (aside from money market funds) or most bank trust funds.<br />
There also are gaps in reporting. <strong>Report</strong>ing requirements for investment<br />
companies were set decades ago and do not include now-common newer<br />
products. For instance, they do not include granular data about derivatives<br />
trading and securities lending.<br />
Efforts are under way to improve data about parts of the asset management<br />
industry. In October <strong>2016</strong>, the SEC finalized new disclosures for<br />
mutual funds, other funds it oversees, and investment advisers. The final<br />
rule will require structured reporting on portfolio holdings and various<br />
fund characteristics. The SEC also finalized rules expanding reporting on<br />
liquidity management, risk management, and derivatives use. In August<br />
<strong>2016</strong>, the SEC adopted amendments to Form ADV to collect data from<br />
investment advisers on assets in separately managed accounts.<br />
These rules will improve visibility into investment companies and<br />
advisers regulated by the SEC. However, the SEC doesn’t regulate banks<br />
offering collective investment vehicles. The OCC regulates the asset management<br />
activities of federally chartered banks. The OCC requires national<br />
banks and federal savings associations to submit data monthly to the OCC<br />
and fund participants on short-term investment funds. For all collective<br />
investment funds, some aggregated, structured data is included in the Call<br />
84 <strong>2016</strong> | <strong>OFR</strong> <strong>Financial</strong> <strong>Stability</strong> <strong>Report</strong>
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