Although the FSB has decided to preserve its option to designate individual asset-management firms as systemically-important financial institutions (SIFIs), its final global framework for this sector instead addresses the activity-and-practice concerns that have dominated debate since the industry decisively defeated the FSB’s initial attempt to lay out a designation framework.  The International Organization of Securities Commissions (IOSCO) is pressed hard by the FSB – dominated to a considerable degree by global regulators with a banking focus – to impose standards in an array of areas of primary concern often only to bank regulators through use of bank-regulatory tools.  These include an array of liquidity-risk and stress-testing standards for open-end funds that could lead to numerous liquidity-risk management requirements as well as to imposition of the redemption limitations included in the SEC’s rules for U.S. MMFs.

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