The FIN-FSA: Fundamentals of Financial Markets PDF

The FIN-FSA Fundamentals of Financial Markets and Institutions Aalto University 2025 Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 1 The FIN-FSA Fundamentals of Financial Markets and Institutions, Aalto Univ...

The FIN-FSA Fundamentals of Financial Markets and Institutions Aalto University 2025 Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 1 The FIN-FSA Fundamentals of Financial Markets and Institutions, Aalto University Marko Hovi, FIN-FSA Head of Division, Capital Markets Supervision, Investment Products and Services, Master of B.S., Master of Laws The member of the IMSC, ESMA (European Security Market Authority) The member of the SSF, ESMA Agenda for the presentation The Financial Supervisory Authority - FIN-FSA The Finnish fund market in numbers Fund regulation − UCITS − AIFMD Upcoming regulatory changes Supervision and supervisory priorities in fund management Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 2 The Financial Supervisory Authority - FIN-FSA Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 We work for the benefit of users of banking, insurance and investment services The Financial Supervisory Authority (FIN-FSA) is Finland’s authority for the supervision of the financial and insurance sectors. The entities supervised by the authority include banks, insurance and pension companies as well as other companies operating in the insurance sector, investment firms, fund management companies and the Helsinki Stock Exchange. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 4  We safeguard market stability and confidence We safeguard stability and confidence in the financial markets, the protection of customers and investors, and insured benefits. We support the maintenance of public confidence in the functioning of financial markets. In addition to supervision, our core business is also regulation. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 5 Operational basis Funding The Act on the Financial Supervisory Authority sets 5% out the powers of the FIN-FSA. Bank of Finland 95 % The Parliamentary Supervisory Council supervises the activities of the FIN-FSA. Supervised entities Administratively, the FIN-FSA The FIN-FSA finances its activities operates in connection with the mainly by levying special Bank of Finland, but in its supervision fees on its supervised supervisory work it takes its entities as well as various decisions independently. processing fees. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 6  Parliamentary Supervisory Council Organisation Board of the Financial Supervisory Authority Internal Audit Director General 240 Employees Digitalisation Banking Insurance Capital Legal Unit Director and Analysis Supervision Supervision Markets General’s Supervision Staff Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 7 Capital Markets Supervision Markets Investment Services and Products Supervision of Infrastructure IFRS Enforcement Inspections and Systems Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 8 Capital Markets Capital Markets Supervision Supervision Who do we supervise? What do we supervise? Investment service providers Investor information related to securities offers Fund management companies and other investment products and alternative investment fund Listed companies’ disclosure of information and managers IFRS financial statements and prospectuses Investment-based Securities market trading and related reporting crowdfunding intermediaries In addition, we investigate possible securities Securitisation auditors market abuses and evaluate and monitor the Stock Exchange activities of audit committees. Finnish Central Securities Depository (APK) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 9 Banking Supervision Banking Supervision Who do we supervise? What do we supervise? Credit institutions Capital adequacy and liquidity of credit institutions sector (3 largest supervised entities in cooperation with the ECB) Sound governance of credit institutions Credit institutions’ organisation of risk management, and risk-taking in relation to risk-taking capacity Authorisations and reporting, application and notification issues In addition, we participate in regulatory development impacting credit institutions Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 10 Digitalisation and Analysis Financial Analysis Anti Money Laundering Payment services and IT supervision Public / BOF/FIN-FSA-UNRESTRICTED Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 11 Digitalisation and Analysis Who is covered by What kind of issues do we address? our activities? Operating environment analysis All FIN-FSA Financial status analysis of supervised entities supervised entities Macroprudential policy Payment systems Reporting Prevention of money laundering and terrorist financing Banking code of conduct and customer protection Provision of payment services and virtual currency Operational risks Regulatory compliance of new digital solutions Cybersecurity In addition, we are responsible for the FIN-FSA’s information management. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 12 Insurance Supervision Insurance Supervision Employee pension institutions Life and Non-life Insurance Unemployment, Pension and Sickness Funds Conduct of Insurance Business Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 13 Insurance Supervision Who do we supervise? What do we supervise? Employee pension insurance Protection of insured benefits providers Solvency Pension funds Risk-taking and risk management Life and non-life insurance companies Stable operations and sound governance Unemployment funds Conduct of Business and customer Employee sickness and benefit funds protection Insurance associations Application and registration issues Insurance intermediaries In addition, we participate in regulatory development Other insurance sector actors Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 14 Legal Unit Legal Unit Preparation of administrative sanctions Preparation of FIN-FSA regulations and guidelines Maintaining the insider register and training staff on insider and trading issues Legal support for the management and the rest of the organization Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 15 We participate in European supervisory cooperation We are part of common European banking supervision. We are involved in the work of the European Supervisory Authorities. We work with Nordic supervisory authorities Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 16 Single Supervisory Mechanism The European Central Bank Under the auspices of the The largest banks are directly (ECB) has the main ECB, different countries’ supervised by the ECB, while responsibility for common supervisory authorities smaller banks are supervised banking supervision. oversee banks according by the national supervisory to the same principles authorities of each country. and regulations. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 17  Banks Non-life, life and reinsurance companies Employee pension insurance companies We supervise Pension funds Pension and employee sickness funds and other around one benefit funds Insurance associations thousand entities Unemployment funds Other entities active in the insurance sector Investment firms Alternative investment funds and their managers Fund management companies Finnish Central Securities Depository (APK) Stock Exchange Payment institutions Virtual currency providers Other credit providers In addition, we supervise insurance intermediaries. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 18 How supervision works in practice Regulation of the financial The FIN-FSA assesses In addition to reporting within sector is mainly from the EU whether the activities of ongoing supervision, the FIN- level. Compliance is generally supervised entities are on a FSA receives information about monitored at national level, as in sound foundation. its supervised entities via the FIN-FSA. regular inspections. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 19 The Finnish fund market in numbers Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Registered and authorised fund managers Of the total amount of 99 registered AIFM managers − 13 managers have registered as managers of EuVECA funds − 1 manager has registered as a manager for EuSEF funds Of the total amount of 36 authorised AIFM managers − 20 managers have only an AIFM authorisation − 16 managers have a dual authorisation (UCITS & AIFM) − 5 of the AIFM managers have also the authorisation to provide MiFID services − 1 manager have registered as manager of EuVECA funds Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Supervised entities (2019-2024) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 22 Assets under management (AUM) and net assets (NAV) in Finnish Funds 31.12.2023: 31.12.2022: Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Development of Finnish fund sector since 2015 Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 24 Finnish AIF-funds - AUM 2015-2023 Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Finnish fund sector and open-ended real estate funds Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 26 Fund regulation Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Harmonised Fund Regulation across Europe The regulation of funds activities is harmonised across Europe The fund regulation applies to collective portfolio management − individual portfolio management is regulated in MiFID II UCITS (Undertakings for Collective Investment in Transferable Securities) Directive – First version of the Directive issued in 1985 AIFMD applicable from 2013 EuSEF, EuVECA and ELTIF Regulations complementing the AIFMD directive MMF Regulation regulating funds investing in Money Market Instruments and Funds (UCITS and AIFMD) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 UCITS Directive The UCITS Directive is minimum harmonisation e.g. it sets minimum standards and requirement for UCITS managers and funds − Member States have the right to set higher standards than those set in the directive It places a strong focus on investors’ protection and product regulation UCITS funds shall be open to daily subscriptions and redemptions – they can only invest in liquid assets e.g. listed instruments − Detailed requirements in the UCITS Directive UCITS funds are described as open-ended funds also because they can be marketed to retail (non-professional) investors Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Requirements for Funds Managers and UCITS funds UCITS funds can only be managed by authorised UCITS fund managers A UCITS fund manager can also be granted authorisation to manage AIF-funds Further they may be authorised to offer specific investment services A fund management company must separate fund assets from its own assets by assigning the former to a depositary, The UCITS Directive sets up requirements for investment objectives, diversification rules, liquidity requirements Every new UCITS that a fund managers sets up must be authorised/approved before marketing Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 UCITS legislation in Finland The UCITS Directive is implemented in the Act on Common Funds (Sijoitusrahastolaki, SRL, 213/2019) − Complementing level Directives and level 3 ESMA guidelines Fund managers in Finland must be limited liability companies (Oy) The legal form of UCITS funds is not harmonised However Finnish UCITS-funds can only be contractual funds FIN-FSA approves the funds rules, changes to funds rules, fund mergers etc. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Background for the Alternative Investment Fund Directive (AIFMD) The UCITS directive regulated open ended funds investing in transferable securities (e.g. listed instrument) Due to the role of “unregulated” hedge funds in the financial crises in 2007-2008 more regulation on a European level was needed in the aftermath of the crises First draft of the AIFMD was published in 29.4.2009 and the directive issued in 2011 entering into force in 2013 − In Finland 17.3.2014 The scope of the AIFMD was however much broader than only hedge funds – it encompasses all types of collective investing that is not already under the scope of the UCITS directive Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Scope of the AIFMD The AIFMD applies to collective investing that do not require authorisation pursuant to the UCITS-directive The AIFMD defines an “AIFM” as a legal person whose regular business is managing one or more AIF:s Characteristics of an “AIF” 1. Collective investment undertaking 2. Raising capital 3. From a number of investors 4. With a view to invest it in accordance with a defined investment policy Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Scope of AIFMD The definition of “AIF” requires that all four criteria are applied in order for a legal construction to be classified as an AIF- fund According to national legislation FIN-FSA can issue a decision regarding AIF- activities and the need for license or registration When are the AIF criteria not fulfilled? Examples: − When the investors have not delegated the decision-making power to third parties – they have day-to-day discretion or control − When the undertaking has a general commercial or industrial purpose Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Authorisation of registration? The need to apply for an authorisation depends on the assets under management Registration – exemption from authorisation: − AIFMs managing portfolios of AIFs whose assets under management, including any assets acquired through use of leverage, in total do not exceed a threshold of EUR 100 million; or − AIFMs which manage portfolios of AIFs whose assets under management in total do not exceed a threshold of EUR 500 million when the portfolios of AIFs consist of AIFs that are unleveraged and have no redemption rights exercisable during a period of 5 years following the date of initial investment in each AIF. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Authorisation of registration? According to AIFMD, AIF funds can only be marketed to professional investors AIFs can be marketed to retail investors depending on the national regime in every EEA- country Authorised AIFs are allowed to market their AIF:s in Finland also to non-professional investors According to the AIFMD authorised AIFMs can manage and market their AIFs cross border − Different national regimes for registered AIFM:s Compared to the UCITS-directive − The AIFMD regulates the alternative fund manager, not in detail the AIF-funds − The AIFMD does not regulated what an AIF can invest in, set out detailed diversification rules etc. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Authorised AIFM AIFMs are authorised for portfolio management and risk management − Only one of the two can be outsourced − Outsourcing only to other authorised entities − The AIFM must not be a “Letterbox entity” Authorisation are granted per strategy − Private Equity − Fund-of Funds − Real Estate − Hedge − Other AIFMs may not engage in unauthorised activities Marketing notification is needed to market AIF-funds New rules on pre-marketing Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Registered AIFM The requirements for registration vary between different members states and is not harmonised The requirements for the registration are more limited than for authorisations, e.g. − No requirement for AIFs to have a depositary − No organisational requirements In Finland registered AIFMs may in general only market their AIFs to professional investors − Some exceptions exist Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Requirements for fund managers Requirement Authorised UCITS Authorised AIFM Registered AIFM Regulation regarding the Yes Yes Yes managers Legal form of the manager (oy) Yes Yes Yes Organisational requirements Yes Yes No and rules on outsourcing Fit&Proper and qualifying Yes Yes Yes (as of 1.3.2019) holding rules Requirement to have a Yes Yes No depositary Possibility to manged a fund Yes Yes No cross border Reporting requirements Yes Yes No regarding the financial standing of the manager (FINREP, COREP) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Requirements for fund managers Requirement Authorised UCITS Authorised AIFM Registered AIFM Right to markets funds to non- Yes Yes Limited possibility to market to professional investors a retricted group of non- professional invetors Products specific regulation Yes No No regarding - Legal form - Investment objectives - Diversification Rules Disclosure requirements Yes Yes Yes regarding the product Right to market funds cross Yes Yes Can be allowed border Reporting obligations of the Yes (only SIRA) Yes Yes funds investments (AIFMD, SIRA) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Sustainable Finance Regulation The regulatory framework on sustainable finance consists of a broad collection of regulations applicable to companies that are active in the financial markets The Sustainable Finance Disclosure Regulation (SFDR) is a European regulation introduced to improve transparency in the market for sustainable investment products, to prevent greenwashing and to increase transparency around sustainability claims made by financial market participants. − Gradually into force as of 10.3.2021 Further the Taxonomy Regulation establishes a framework to facilitate sustainable investment − ‘Green list’ of environmentally sustainable economic activities Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 SFDR (6,8 and 9 art.) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 42 Breakdown of funds according to SFDR disclosure obligations Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 43 PRIIPs Regulation PRIIP = packaged retail and insurance- based investment products The PRIIPs Regulation applies to service providers producing and offering PRIIPs products to retail investors. These include banks, insurance companies, management companies and alternative investment fund managers and bond issuers. Service providers must prepare a Key Information Document (KID) for each product. The transition period under PRIIPs regulation for UCITS funds ended on 1 January 2023. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Upcoming regulatory changes Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 AIFMD Review Initiated by the European Commission, KPMG carried out a study and issued a report on the Operation of the Alternative Investment Fund Managers Directive already on 10 December 2018 A final regulatory text was published in March, 2024 Main changes regarding − Delegation − Liquidity management tools (LMTs) − Loan origination Funds − Depositaries − AIFMD reporting (level 2) Changes at national level may also cover other areas Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Other regulatory changes ELTIF 2.0 (2024) ESMA Guidelines on fund names (ESG), 2024 − As an example, funds using sustainability related terms (Group 1) should: 1. meet an 80% threshold linked to the proportion of investments used to meet environmental or social characteristic or sustainable investment objectives in accordance with the binding elements of the investment strategy, which are to be disclosed in Annexes II and III of CDR (EU) 2022/1288; 2. exclude investments in companies referred to in Article 12(1)(a) to (g) of CDR (EU) 2020/1818 − Other terms: − Group 2: Green, ESG, impact, environmental, SRI, climate − Group 3: Social, governance, transition, net zero UCITS Eligible Asset Directive Review MiCA-Regulation (2024) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Supervision and supervisory priorities in fund management Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Supervision in fund management On-going supervision Annual questionnaire Thematic reviews On-site inspections Authorisation and registration processes Fund rules and changes of fund rules approvals (product approval) Reporting Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Supervisory priorities Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Supervisory approach The Capital Markets supervisory focus is largely based on the FIN-FSA strategy ESMA supervisory priorities have on impact on the FIN-FSA supervision The supervisory approach is risk based Based on the risk-based approach a minimum level of engagement is set for supervised entities The specific supervisory activities are planned annually (FIN-FSA annual supervision plan) – 2024 priorities: Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Key supervisory activities in 2023-25 Thematic review regarding stress tests of open-ended AIF-funds investing in real estate (2023) Thematic review in the area of sustainability covering the risk of greenwashing in the fast-growing area of sustainable investment management products (ESMA CSA=Common Supervisory Action, 2024) − Key findings SFDR templates: lack of information, misleading, PAI indicators not at appropriate level On-site inspections (risk management, valuation) Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 FIN-FSA Supervisory actions on liquidity management and valuation in the fund sector 2019 - 2023 War in Ukraine, Higher inflation starting in Q1/2022, Funds investing in and interest rates Covid-19 crisis affected the real and the Russia were closed Liquidity management for subscriptions estate sector and Market situation concerns in European funds challenging the need for market situation, and redemptions began to grow in 2019, investors to accompanied by individual especially redeem their scandals Q1/2020 investments 2019 2021 2023 FIN-FSA supervisory actions 2020 Two thematic reviews: 2022 Thematic review: Liquidity management of Liquidity stress tests UCITS and open-ended Thematic review: Asset for open-ended real Thematic review: AIFs 2020-2021 valuation processes of estate funds Valuation and UCITS and open-ended liquidity AIFs 2022 management of open-ended real estate funds 2019 Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 53  FIN-FSA supervisory actions for fund management companies regarding sustainable finance Taxonomy regulation Integrating SFDR Sustainable Finance (objectives regarding sustainable risk Delegated Taxonomy regulation Regulation climate change and factors in regulation regarding four Disclosure mitigation and the UCITS 1288/2022 First PAI- SFDR level remaining objectives Regulation SFDR adaptation) applicable Directive and applicable statement 1 open for applicable for 2023 in applicable March 2022 AIFMD 1.1.2023 30.6.2023 consultation 2024 reports 2021 2022 2024 FIN-FSA supervisory 2021 Sustainable 2023 actions finance webinar Thematic review Annual survey on Review of Thematic review and meetings Seminar for report publication SFDR sustainability (CSA) regarding with branch supervised spring and autumn requirements and related sustainability risk organisations entities 2024 publication of templates during and disclosures, including supervisory approval of fund survey sent to fund Review of sustainability- Q&A on FIN- sustainable PAI survey for statement on the rules. management related disclosures in fund FSA’s webpage finance fund observations. companies. prospectus. Publication of 2021-2022 presentations. management supervisory statement. companies. Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 54 Supervisory focus areas in fund supervision in recent years Thematic reviews on outsourced compliance function (Report 24.4.2023) Thematic review (ESMA CSA) and inspection on fund asset valuation (Report 9.11.2022) Thematic review (ESMA CSA) on costs and charges (Report 24.3.2022) Thematic review (ESMA CSA) and inspection on liquidity risk management (Report 8.4.2021) Reports published on FIN-FSA website: https://www.finanssivalvonta.fi/en/publicatio ns-and-press-releases/supervision-releases/ Public / BOF/FIN-FSA-UNRESTRICTED 5.2.2025 Open-ended real estate funds in Finland NAV and AUM development Open-ended real estate funds (ORF) The real estate market has been challenging since 2022. 27 ORFs in total, NAV about 8 billion euros, 10 has either used gates or suspended redemptions in 2023-25. The act allows marketing also to retail clients. The FIN-FSA has performed several thematic reviews regarding liquidity stress tests since 2019 and valuation, on-site inspections. Key findings (stress testing 2023): stress tests were not at appropriate level, lacks in reporting to the boards and internal processes and policies. The FIN-FSA recommended liquid assets (cash, MM instruments) at least 10 % in 2023. Public / BOF/FIN-FSA-UNRESTRICTED Thank you Public / BOF/FIN-FSA-UNRESTRICTED Annexes Public / BOF/FIN-FSA-UNRESTRICTED  Our activities are guided Our activities are guided by four values by four values Dynamic Responsible Effective Together We are pro-active in Our activities are We concentrate on We are a supportive perceiving changes in our consistent, constructive essentials. working community. We operating environment and of the highest learn constantly and We take responsibility and supervised entities quality. support others in their for our own and the and we continuously own professional We are aware of the whole organisation’s develop our activities development. consequences of our results. accordingly. actions. We create a positive We are vigilant and take We follow developments team spirit. We communicate swift action when in real time and are openly, bearing in mind needed. We work in good actively involved in our responsibilities. cooperation with all our progress at the stakeholders. international level. Public / BOF/FIN-FSA-UNRESTRICTED  Strategy of the Financial Supervisory Authority (FIN-FSA) 2023–2025 Strategy of the Financial Supervisory Authority (FIN-FSA) 2023–2025 Dynamic Our supervision is proactive and Our operational management is consistent. flexible. Proactive and Flexible and Our effectiveness and trust in us have predictable changeable Our organisation’s activities and increased and are supported by supervision organisation resourcing are long-term and risk- communication. based. PROACTIVE AND We use data effectively in monitoring Our expertise responds to changes in and decision-making. PREDICTABLE the operating environment. SUPERVISOR In our supervisory activities, we We ensure financial stability harness cooperation with the EU. Together and confidence in the financial Responsible markets and enhance the protection of customers and investors and We apply common, uniform and Our management supports well-being insured benefits efficient processes. in work. High-quality analysis enables Operations Expertise- We have comprehensive and proactive supervision. harness supportive encouraging career-path and digitalisation management development opportunities. Effective Data systems enhance our operational efficiency. Our good employer image promotes successful recruitment. ECONOMIC DEVELOPMENT REGULATION DIGITALISATION CYBER THREATS GEOPOLITICAL SITUATION DEMOGRAPHICS AND WORK CLIMATE CHANGE Public / BOF/FIN-FSA-UNRESTRICTED Open-ended real estate funds and LMTs (liquidity management tool) in Finland According to national legislation the following LMTs are available for open-ended real estate funds: Redemption fees Suspensions of redemptions Gates Swing pricing Redemption in kind Temporary use of loans for redemptions Notice period for redemption Public / BOF/FIN-FSA-UNRESTRICTED Fund reporting Public / BOF/FIN-FSA-UNRESTRICTED AIFMD reporting AIFMD reporting − Based on the requirements in the AIFM- directive − Further specified in the level 2 Regulation − ESMA Guideline on further details regarding the reporting Reporting includes − Authorised AIFM managers and their AIFs − Registered AIFM managers and their AIFs − Third country AIFMs/AIFs marketed in Finland The purpose of the AIFMD reporting is to effectively monitor and prevent systemic risk and market disruptions − E.g. monitoring of level of leverage in AIFs Public / BOF/FIN-FSA-UNRESTRICTED AIFMD reporting The information to be reported and its timing and frequency depend on the characteristics and assets under management of the AIFs managed by an AIFM Reporting on an annual, semi-annual or quarterly basis Changes expected to the reporting as a result of the AIFMD Review More information on the content and practical issues on FIN-FSA website Public / BOF/FIN-FSA-UNRESTRICTED Fund reporting to the Bank of Finland (PEF, SIRA) PEF and SIRA data collection is separate from the AIFMD reporting managed and collected by the FIN-FSA The PEF and SIRA reporting collected by BoF is based on Regulation concerning statistics on the assets and liabilities of investment funds (ECB/2013/38) “Balance sheet” statistical reporting Aggregated information on the reporting is published by the BoF The FIN-FSA has access to the data reported to the BoF Public / BOF/FIN-FSA-UNRESTRICTED