AxiomSL has created a new solution to address the new EU requirements defined in the Investment Firms Regulation (IFR) and Investment Firms Directive (IFD), followed by the UK requirements from the Financial Conduct Authority (FCA) that have yet to be finalised.
The solution is set to enable investment firms to approach this significant shift in the current rules, including new category classifications, and to better manage the potential increase in regulatory capital requirements that most investment management firms will be subject to across jurisdictions.
In addition, the solution will populate and validate the reports to meet local authority/regulator requirements for capital and liquidity reporting.
The deadline for IFR/IFD is 26 June 2021.
IFR will be initiated under a five-year transition period beginning in 2021 and it is expected that the regulator will provide ongoing updates to requirements, categorisations, and data needs over the transition period.
AxiomSL warned that the use of Excel spreadsheets and manual processes will not suffice given the regulation’s complexities, expanded and granular requirements and tight timeline.
Edward Royan, head of global products, AxiomSL, stated: “There will be many challenges in complying with the IFR/IFD regimes since the implications of the new rules are complex and extensive. In our discussions with investment firms, we have noted the expected impact on capital and liquidity requirements.”
“The challenge here is to juggle between previous requirements still in place and the new requirements, in addition to dealing with one set of calculations for Europe and another set for the U.K. Our data integrity and control platform will enable firms to seamlessly integrate source data across functional silos including – treasury, finance, risk, and others – with the proper controls to deliver accurate reporting and ensure that clients’ submissions satisfy regulators’ requirements and withstand scrutiny across jurisdictions.”
