Asset managers and the "too big to fail" problem

A recent paper by a working group of the Investment Management Association (IMA) notes that the collapse of Lehmans and the bail out of the banks has ushered in a new regulatory and political climate.

First, it showed that even a global banking brand can experience severe financial difficulties, and potentially come perilously close to collapse.  And secondly, it was a catalyst for concern about the “too big to fail” problem. It is fair to say that regulators and politicians have been fixated by this problem ever since, with headlines about recovery and resolution proposals, capital requirements, compensation schemes and confidence dominating the press. Against this landscape, it has been recognised that a number of asset managers have over time turned increasingly to outsourcings ...