Summary
- The Financial Conduct Authority (FCA) has published a policy statement (PS26/17) on enhancing fund liquidity risk management, following responses to Consultation Paper 25/38.
- Key changes include maintaining the principle that liquidity risk management is the responsibility of the authorised fund manager (AFM) and clarifying anti-dilution mechanisms for UCITS and non-UCITS retail schemes.
- The FCA will implement new rules and guidance effective February 1, 2027, with transitional provisions extending until August 1, 2027.
- Future consultations will address liquidity proposals for retail funds investing in illiquid assets, potentially expanding the liquidity management toolkit for AFMs.
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