The UK’s Hansa Trust has appointed a depositary in readiness for the Alternative Investment Fund Managers Directive (AIFMD).
BNP Paribas Securities Services (BNPP SS) wins the depositary banking mandate for the global equity investment company that has about £280 million (€206 million) of assets.
Despite employing traditional investment strategies, an investment trust is caught by the AIFMD regulation for alternative investment managers because trusts fall out of scope with the Ucits rules that cover traditional funds.
Investment trusts trade on stock exchanges like companies and are particularly popular in the UK where the sector holds around £78 billion of assets under mangement.
In line with AIFMD, which requires many in-scope investment managers to appoint a depositary for the first time, BNPP SS will monitor cash movements within the trust’s funds and provide custody services. The bank will also perform oversight duties to ensure that management decisions comply with the fund prospectus and any relevant laws and that shareholders’ interests are protected.
Stephen Thomas, chief financial officer at Hansa Capital Partners, notes that Hansa is fully compliant more than one month prior to the AIFMD deadline.
Linda Morsia, head of UK trustee and depositary services at BNPP SS, says an important part of implementing AIFMD for trusts is to clarify the respective roles of depositary banks and investment trust boards to avoid duplication.
A recent survey found 47% of 56 alternative managers had not registered under AIFMD.
Another survey found 33% of 61 fund manager respondents with €33 trillion of assets have AIFMD reporting provisions in place.
Managers of alternative funds without a licence will not be able to market their funds in Europe after the July 22 deadline.
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