A tough regulatory environment has left asset management
struggling to comply, and keep costs down.
This is leading to consolidation in the industry, with
regulations in the EU such as Alternative Investment Fund
Managers Directive (AIFMD), Markets in Financial Instruments
Directive (MiFID II), European Market Infrastructure Regulation
(EMIR) and General Data Protection Regulation (GDPR) having
been particularly intense for asset managers, affecting their
"For many firms struggling under the weight of these complex
regulations, consolidation is often seen as the best option,"
said Jamie Carter, chairperson of the New City Initiative
(NCI). The New City NCI is a think tank that offers expertise
on financial regulation.
Consolidation has seen boutique asset managers –
smaller, more specialised providers – buckle under the
pressure of competing with larger, mega funds that benefit from
economies of scale. This has led to a strangled environment,
with competitiveness at risk.
Scale has become...