Mon, Sep 26, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Moody’s upgrade points to reopening of the Chilean pension market to Irish UCITS

Wednesday, January 22, 2014
Opalesque Industry Update - It’s been a rocky road for Dublin over the past few years, but last month’s exit from the European Union-International Monetary Fund bailout and last Friday’s welcome news that Moody’s would follow Fitch and S&P by upgrading Irish sovereign debt to investment grade status will help smooth the path for Irish UCITS to get back on the “general investment” list for Chilean pension funds.

In late August 2011, the Chilean Pensions Regulator, the Comisión Clasificadora de Riesgo (the “CCR”), moved Irish UCITS to its Restricted Investments List following the downgrade of Irish sovereign debt to below investment grade status. The CCR rules (Article 15 of CCR Decision No. 32) requires a credit rating for the fund domicile of A by at least two of the three major rating agencies (see Dechert Newsflash, Irish Domiciled UCITS Moved to Restricted Investments Status by Chilean Regulator).

The Chilean pension fund industry is an important market for UCITS and the restriction on investment in Irish UCITS by Chilean pension fund investors was a competitive disadvantage for Irish UCITS.

However, it now looks as if this market will reopen following the upgrade, coupled with a recent modification to the CCR rules which now permit the CCR, in exceptional circumstances, to approve the sovereign rating of a country not meeting the requirements by considering the characteristics that have led to non-compliance.

Dechert understands that members of the CCR had informally stated the CCR was prepared to consider Ireland as a fund jurisdiction meeting the credit requirements once Ireland was rated BBB or greater by all three major credit rating agencies. In these informal statements, the CCR also indicated that the especially robust supervisory capability of the Central Bank of Ireland has been a factor in their willingness to provide Ireland with special consideration.

The Moody’s upgrade means that this condition has now been met and we expect managers of Irish UCITS will now restart their applications to register their UCITS in Chile.

Dechert monitors regulatory and market developments in Chile and more than 80 jurisdictions globally as part of our comprehensive service for supporting the cross-border distribution of investment funds.

Dechert

Press Release

BM

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
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. North America - Acela fight splits hedge fund Connecticut and old money enclaves[more]

    From Bloomberg.com: Connecticut’s residential coastline is two worlds, the one of newcomer millionaires and one whose wealth and New England roots span generations. Now, their differences over a rail route threaten to gum up plans for the U.S. Northeast’s fastest-ever trains. About 30 miles from Man

  2. Activist News - Caesars offers creditors another $1.6bn, would spell end of hedge fund ownership, Activist investors double chance of CEO exits[more]

    Caesars offers creditors another $1.6bn, would spell end of hedge fund ownership From Calvinayre.com: Casino operator Caesars Entertainment has improved its offer to junior creditors to over $5b, but the offer is only good until Friday. On Wednesday, Caesars added an extra $1.6b to the $

  3. Nobel Sustainability Trust, Prince Albert II of Monaco help launch major new initiative to drive sustainable technologies[more]

    Matthias Knab, Opalesque: The Nobel Sustainability® Trust ("NST") is leading a major new initiative to finance, incubate and accelerate the development of clean technologies. The initiative will start with the formation of the Nobel Sustainability Fund® ("NSF"). NSF will drive faster access t

  4. Hedge funds saw four consecutive months of outflows in August, but assets still up by $17.6bn YTD[more]

    Komfie Manalo, Opalesque Asia: Hedge funds witnessed four consecutive months of outflows with investor redemptions totaling $23.8bn as of end of August, data provider Eurekahedge said in its monthly report. But total hedge fund assets grew by

  5. Trend reversals lead to losses as managed futures drops 1.52% in August[more]

    Komfie Manalo, Opalesque Asia: Trend reversals in August have led managed futures traders to lose 1.52% last month according to the Barclay CTA Index compiled by BarclayHedge. The Index is up 0.62% year to dat