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SELF REGULATION AT ANBIMA ASOCIACION DE ADMINISTRADORAS DE FONDOS MUTUOS DE CHILE (AAFM) Convencíon 2011. Viña del Mar/Chile – Ago, 1-2, 2011. TOPICS TO BE PRESENTED. ANBIMA ANBIMA´s Self Regulation Activity Investment Fund Self Regulation ANBIMA and IOSCO/SROCC. INSTITUTIONAL . - PowerPoint PPT Presentation
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SELF REGULATION AT ANBIMA
ASOCIACION DE ADMINISTRADORAS DE FONDOS MUTUOS DE CHILE (AAFM)
Convencíon 2011
Viña del Mar/Chile – Ago, 1-2, 2011
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ANBIMA
ANBIMA´s Self Regulation Activity
Investment Fund Self Regulation
ANBIMA and IOSCO/SROCC
TOPICS TO BE PRESENTED
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INSTITUTIONAL
Represents over 340 members
Daily disclosure of indicative prices of government bonds and debenturesData and analysis related to the fixed income marketSupport to Central Bank's Selic SystemThe largest market database in BrazilResearch and Publications
Trade Association
Investors’ EducationCertification of investment professionalsEducation
Products and Services
Regulation and best practices in its products and servicesAgreement with CVM to analyze registrations of public offerings of securitiesSupervision and Enforcement roles
Self-Regulation
ANBIMA – Brazilian Financial and Capital Markets Association
REGULATION AND SELF-REGULATION IN BRAZIL
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SELF REGULATIONTimeline
1990 2000 2004 2006 2008
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Code of Continuous
Certification
Start up as Optional Private Regulatory
Body, publishing the Code of Public
Offers, for Distribution and
Purchase of Securities
Beginning of the discussion Code of
Investment Funds
Code of Custody
Becomes member of the Iosco’s SRO Committee
Codes of Private Banking and Qualified Services (*)
Code of Processes
Signature of Agreements with CVM
(*) The Code of Qualified Services merged the Code of Custody, and included a chapter on Controlling.
Code of Wealth Managers, Code for FIP and FIEE markets and Open Market Code
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REPRESENTATIONCOMMITTEES
Public Hearing
To be approved by the General Assembly
Supervision
Investigation procedures
Investigation technical analysis
REGULATION COUNCIL
Process and judgment
Impose penalties and enter into Instrument of Commitment.
SELF REGULATIONStructure
The committees propose norms
The Board of Directors of ANBIMA approves and proposes alterations Denunciation examination
FOLLOW UP COMMISSION
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SELF REGULATIONCode of Investment Funds
Includes: Funds 409 and Credit Receivables Investment
Funds (FIDC)
Objectives and General Principles:
• Fair Competition
• To protect the interests of the investors
• Fulfill the objectives of fund investment
• Disclose information in a transparent way
• Not affect the trustee relationship
• Not bring harm to the industry
Portfolio Manager (firms only):
► Registration form
► Documents disclosure
► Background checking
► ANBIMA’s due diligence
► Ethical committee’s approval
► ANBIMA’s Board approval
SELF REGULATION
►Disclosure documents requirements: Brazilian SEC approval Firm’s by-laws Principal’s resume Business Plan Introducing letters (from members only) Policies:
risk management system and policy personal investment policy business continuity policy compliance activity independent from risk management, MtM and
commercial units/activity
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SELF REGULATION
Main topics:
► Fund by-laws and prospectus elaboration
► Classification of funds
► Advertising
► Sales practices
► Suitability
► Proxy Voting
► Liquidity controls
► Portfolio Manager licensee
► MtM activity
SELF REGULATIONCode of Investment Funds
Funds Administration Portfolio ManagersSet up, registration and approval of by-laws
Investments mandate and trading of underlying assets
Prospectus, advertisement and suitability material
Proxy voting policy
Daily disclosure of NAV Liquidity control proceduresHiring of providers such as custodians and distributors
Licensee of professionals
Disclosure of NAV and MtM activity
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SELF REGULATIONCode: funds administration vs. Portfolio managers
MONITORING INSPECTION / ON-SITE EXAMS
PRUDENTIAL SUPERVISION
- Fund registration at the Association’s database
- Analysis of daily info
- Analysis of docs (prospectus, advertisement material, proxy voting and suitability policies)
- Main filters: MtM and performance/volatility
Risk based supervision started in 2010
- Focus on portfolio managers risk management , contingency plans and information barriers policies
Thematic alerts and investigations:
- Focus on MtM of non liquid assets
- Exposure of the industry to new type of assets
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SELF REGULATIONANBIMA´s monitoring and inspection activity
Investment Fund Industry – Council of Self Regulation
► Orientation Letters - 44 (administrator/portfolio managers) ► Fines - 334 (registration, daily NAV, advertizing and prospectus) ► Investigations - 6
► Administrative lawsuits - 3*
► Settlement agreement - 2
* 1 administrative lawsuit ongoing
ANBIMA´S ENFORCEMENT FIGURES - 2010
► Sales Practices
Simplified prospectus
Suitability
► Rulemaking focusing on type of funds and type of assets
► Liquidity controls
► Expansion of on-site exams and inspections
REGULATION AND ENFORCEMENT TRENDS
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ANBIMA AT IOSCO/SROCC
► Affiliate member since 2006
► SROCC – Self Regulatory Organizations Consultative Committee
70 members: trade associations/ self regulatory activities, stock exchanges and formal SROs (Finra, IIROC and AMV)
Presidency: Japan Securities Dealers Association (JSDA) Working groups: ahead of the curve and regulators staff
training program Consultations: formal and by invitation (SC3, SC5) Meetings: IOSCO Annual Conference, mid year meeting,
stakeholders meeting, training programs from IOSCO and SROCC
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ANBIMA AT IOSCO/SROCC
► SC3 – Intermediaries Suitability standards (complex products)
► SC5 – Investment Management
ETF Valuation (Pricing) Liquidity Management at CIS Suspension of CIS redemptions
► SC7 – Systemic Risk
Mitigation of systemic risk – a role for securities regulators
Topics related to the Investment Funds Industry
São Paulo
Av. das Nações Unidas, 8.501 11º e 21º andar05425-070 São Paulo SP Brasil+ 55 11 3471 4200 Fax 11 3471 4230
www.anbima.com.br
Rio de Janeiro
Av. República do Chile, 230 13º andar20031-170 Rio de Janeiro RJ Brasil+ 55 21 3814 3800 Fax 21 3814 3960
Thank youMarkets Supervision Area
55 11 3471 4204
José Carlos Doherty
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