FCA Chief Executive Andrew Bailey's Keynote Speech At The Investment Association’s Annual Dinner

FCA Chief Executive Andrew Bailey's keynote speech at the Investment Association’s annual dinner.

The UK has around a one-third share of EU assets under management.  It is the largest market in Europe with around £8 trillion of assets, representing more than the next three countries combined.  Investment managers in the UK manage just over £1 trillion on behalf of overseas-authorised funds.  Over 80% of those funds are domiciled in either Luxembourg or Dublin.  This requires co-operative arrangements that are well established. 

This model works well for investors and for investment managers.  So, why disrupt it, or put another way, must it be disrupted? Does it require membership of the EU to make this system work?  No it does not.

So, what does it require?  Two things are above all else necessary.  First, that we recognise the principles for open financial markets which have long been recognised in goods trade, namely the Most Favoured Nation Principle, which has a very long history in Europe.  It means not restricting free trade to regional trade blocs and not discriminating in the trade terms offered to other countries.  To make that work for financial services like investment management requires regulation in the public interest that delivers equivalent outcomes and protection and embodies close co-operation and information exchange between the regulatory authorities. 

We have this now with EU partners, including through the common regulatory framework that has been put in place, but we also have it with other countries.  We are ready to roll our sleeves up and continue to make open markets work effectively.    




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