The behaviour of asset managers
Hosted by Allen & Overy
March 18 2015
Andy Haldane (Bank of England)
Sarah Breeden (Bank of England)
Helena Morrissey (Investment Association)
- Speech - The Age of Asset Management (Andy Haldane)
Last April, Andy Haldane gave an important speech at the London Business School on the links between asset management and financial stability.
In his opinion, the future for the asset management industry is exceptionally bright. As he put it, “asset management may not only have come of age, we may be about to enter the Age of Asset Management”.
Inevitably, however, there is a downside to this. He is worried about the risk implications of the shift towards less liquid assets and to passive and tracking strategies, together with the greater share of investment risk being left with end investors – not least, in the pensions area. How will households react – particularly in times of stress? And what about such handy perennials as Too Big To Fail, reputational risk and pro-cyclicality? There is also the vexed issue of the appropriate regulatory response; is there something/anything regulators can do to mitigate pro-cyclicality and to encourage ‘patient’ capital?
These are important questions, and what Andy says matters. We are, therefore, delighted that he has agreed to come and talk us through his current thinking. And we are equally delighted that Sarah Breeden, director for Major International Banks in the PRA’s International Banking Supervision Directorate, will be joining Andy at the podium to complement his analysis with her own.
The floor is theirs for as long as they wish, but I am sure that there will be plenty of time for questions. We are very grateful to Helena Morrissey, chairman of the Investment Association, who has kindly agreed to kick off the response.