Bank of Russia clarifies requirements for management companies’ equity
The amendments approved are aimed at enhancing the financial stability of management companies (MC) of investment funds, unit investment funds, non-governmental pension funds and of applicants for management company licences, as well as at forming their equity of the highest-quality and most liquid assets. The relevant Bank of Russia Ordinance was registered by the Ministry of Justice.
This document raises the requirements for assets that are part of MCs’ equity. In particular, it prohibits including structured bonds into calculation. It also limits the share of real estate and establishes the procedure for accounting of obligations under long-term lease contracts.
The amendments reduce the period (from 1 month to 10 business days) for MCs to remedy violations of the minimum equity requirements where such violations are committed for reasons beyond their control.
The Bank of Russia Ordinance will come into force on 3 January 2020, except for the provision regarding the decreased share of real estate to become effective 6 days after the official publication of the Ordinance.