Thu, Aug 28, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Solvency II may deter insurance companies from investing in hedge funds

Monday, October 29, 2012

Benedicte Gravrand, Opalesque Geneva:

Some people think that the regulatory push for more collateral will not be so much of an issue for hedge funds (see Opalesque Exclusive here). However, not everybody agrees with that view.

The Solvency II Directive is a European Union (EU) Directive that codifies and harmonises the EU insurance regulation. It mainly concerns the amount of capital that EU insurance companies must hold to reduce the risk of insolvency. Once the Omnibus II legislation is approved by the European Parliament – and this might now not happen before March 2013 - Solvency II will be scheduled to come into effect in 2014 or 2015. Often called "Basel for insurers," Solvency II is somewhat similar to the banking regulations of Basel II.

The current draft directive allocates a 49% capital requirement for investment into hedge funds, private equity and other alternative assets (classified as "other equities"). This means that for every euro invested in such funds, insurers will be forced to put aside additional cash to cover their investments, reduce their allocation to the asset class or withdraw from investing in such funds altogether (TheDeal).

Pe......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing
  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Study shows what resonates with investors: 'Unwavering', 'passionate' beats 'committed', 'dedicated' and more surprises[more]

    Komfie Manalo, Opalesque Asia: A new study by Pershing Square, a unit of BNY Mellon company, showed that an effective value proposition strengthens audience connections and fosters growth, yet many advisors have had little objective guidance in formulating such statements until now. In the

  2. Hedge fund assets decline in July - eVestment[more]

    Bailey McCann, Opalesque New York: Total assets in hedge funds declined in July and dropped 0.49%, marking the industry's second monthly asset decline in 2014, according to the latest asset flows data from eVestment. Despite the asset decline, total industry AUM remained above the $3 trillion

  3. AIMA makes 'the case for hedge funds'[more]

    Bailey McCann, Opalesque New York: The Alternative Investment Management Association (AIMA), the global hedge fund industry body,

  4. Managed futures' global diversification is important in next phase of economic recovery[more]

    Komfie Manalo, Opalesque Asia: The global diversification provided by managed futures may prove to be extremely valuable as the markets enter the next phase of the economic recovery, said Campbell & Company, a pioneer in absolute return invest

  5. Ex-UBS prop trader's hedge fund Manikay Partners eyes UK launch[more]

    From eFinancialnews.com: Manikay Partners, a $1.7 billion US multi-strategy hedge fund set up in 2008 by a proprietary trader from UBS with backing from Goldman Sachs, is planning to open in the UK. New York-based Manikay's move into Europe comes after Financial News revealed on Monday that Aurelius