What is leverage AIFMD?
It defines leverage as “any method by which the AIFM increases the exposure of an AIF it manages whether through borrowing of cash securities, or leverage embedded in derivative positions or by any other means”. …
Is AIFMD mandatory?
Compliance with AIFMD is required in order to get a passport to sell financial services across the EU market.
What is a depositary AIFMD?
AIFMD – Depositary Requirements. The Alternative Investment Funds Management Directive (“AIFMD”) requires Alternative Investment Fund Managers (“AIFMs”) to appoint a single. depository to all Alternative Investment Funds (“AIFs”) that they manage and introduces new depository requirements in relation to their AIFs.*
What does AIFMD stand for?
Alternative Investment Fund Managers Directive
Alternative Investment Fund Managers Directive (AIFMD)
What is an AIF under Aifmd?
Under AIFMD, an alternative investment fund or “AIF” is: Both open-ended and closed-ended vehicles and listed and un-listed vehicles can be AIFs for the purposes of AIFMD. The definition captures a broad range of vehicles that would be regarded as “funds”, including all non-UCITS investment funds, wherever established.
How is leverage calculated?
Leverage = total company debt/shareholder’s equity. Count up the company’s total shareholder equity (i.e., multiplying the number of outstanding company shares by the company’s stock price.) Divide the total debt by total equity. The resulting figure is a company’s financial leverage ratio.
When was the AIFMD applicable from?
The Alternative Investment Fund Managers Directive (AIFMD) will, subject to certain transitional provisions, come into force in the UK, and across the EU, on 22 July 2013.
What is the purpose of AIFMD reporting?
The purpose of AIFMD reporting is to effectively monitor and prevent systemic risk and market disruptions. The reporting obligation applies to registered and authorised AIFMs, and to those AIFMs that are established in a third country (non-EEA country), which market in Finland the AIFs they manage.
What is the difference between depository and depositary?
As nouns the difference between depositary and depository is that depositary is one who receives a deposit in trust while depository is a place where something is deposited, as for storage, safekeeping or preservation; a repository.
What is the difference between custodian and depositary?
Compared with depositaries, custodians focus on the operational side of the safekeeping and settlement of securities while depositaries focus on the accurate monitoring of the assets.
Who does AIFMD apply?
The AIFMD applies to alternative investment funds (“AIFs”) and their managers (“AIFMs”) where the management and/or marketing of the AIF takes place in any part of the EEA.
What is a bad leverage ratio?
Typically, a D/E ratio greater than 2.0 indicates a risky scenario for an investor; however, this yardstick can vary by industry. Businesses that require large capital expenditures (CapEx), such as utility and manufacturing companies, may need to secure more loans than other companies.
What are the leverage rules in AIFMD?
The leverage rules in AIFMD are essentially aimed at leverage employed at the level of the AIF.
What are the requirements under AIFMD for the EU AIFM?
The requirements under AIFMD are the same as for a non-EU AIFM marketing a non-EU AIF (see above). Under AIFMD, an EU AIFM is able to market non-EU AIFs to professional investors under Member States’ private placement regimes. The EU AIFM must comply with all of the provisions in AIFMD except for the depositary requirements.
Can AIFM undertake a new notification under Article 33(2) of the AIFMD?
Answer 3: The AIFM should not undertake a new notification under Article 33(2) of the AIFMD every time it wishes to manage a new AIF established in a given Member State. The original Article 33(2) notification should be considered valid for all the AIFs it intends to manage in that given Member State.
What are the rules for AIFM reporting in Luxembourg?
The Luxembourg rules on investor disclosure rules are contained in the Luxembourg AIFM Law (articles 21 (1) (a) and 21 (5)), while the rules on reporting on leverage are set out in article 22 (4). In addition, the CSSF’s powers to impose its own limits on the level of leverage an AIFM may employ are set out in article 23 of the Luxembourg AIFM Law.
