EU watchdog wants new rules to curb risk-taking by funds

FRANKFURT (Reuters) – The European Union should adopt tighter rules to stop investment funds from taking on too much debt or setting aside too little cash against assets that are difficult to sell, the bloc’s watchdog for financial risk said on Wednesday.

“Additional liquidity management tools, further supervisory requirements and tighter liquidity stress-testing practices can address risks from liquidity mismatches,” the European Systemic Risk Board said.

“Risks from leverage can be addressed by creating a harmonized reporting framework and by making better use of existing possibilities to set leverage limits.”

(editing by John Stonestreet) OLUSECON Reuters US Online Report Economy 20180214T111655+0000

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