The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

EFAMA Publishes Briefing on the European Fund Classification (EFC)

The European Fund and Asset Management Association (EFAMA) has published the second edition of its “European Fund Classification” (EFC) Forum Briefing which updates on progress made towards the adoption and enhancement of the EFC so far this year.

The EFC has been launched with a view to enhancing the integrity of European investment funds. The primary goal of the EFC is to make available to all industry stakeholders a classification structure which will address transparency issues. In the short-term it aims to classify and regularly monitor every investment fund available for sale in multiple jurisdictions and the long-term plan is to have complete coverage of UCITS.

The EFC Forum reports that it has now finalised the ‘high level’ categories under which the detailed sector classifications will be grouped. Under this methodology, the universe of equity, bond, mixed and money market funds is segmented according to eight criteria: country/region, sector, market capitalization, currency, credit quality, interest rate, emerging market exposure and asset allocation. EFAMA will publish a report presenting and defining all high level categories in 2012 Q1.

The EFC has made significant progress having classified 5,822 funds incorporating 14,559 shares on the basis of the portfolio holdings at end June 2011. This is a considerable increase compared to the 2,847 funds and 10,155 shares classes classified at end March 2011. Furthermore, 30 EFAMA corporate members are now submitting their cross-border funds to the EFC classification process; the list is provided in the Briefing.

Looking forward, a number of fund distributing platforms will incorporate the EFC within their selection system – Allfunds Bank is already committed to that – and a number of fund managers will start providing portfolio data for the classification of their home domiciled funds. These developments will further enhance the profile of the EFC in 2012.

Peter de Proft, Director General of EFAMA commented: “The financial crisis highlighted the need for the fund industry to inform, protect and listen to investors and the EFC initiative to improve transparency is a message to European authorities, investor associations and the public that the industry is taking action to advance the protection of investors.”

Related content

WEBINAR

Recorded Webinar: Entity identification and client lifecycle management – How financial institutions can drive $4 billion in cost savings

A new model in Legal Entity Identifier (LEI) issuance has created significant opportunities for financial institutions to capitalise on their KYC and AML due diligence. By becoming Validation Agents and obtaining LEIs on behalf of their clients, financial institutions can enhance their client onboarding experience, streamline their internal operations, and open the door to new,...

BLOG

S&P Global Acquisition of IHS Markit Creates Financial Data and Analytics Powerhouse

S&P Global’s $44 billion acquisition of IHS Markit will create a financial data and analytics powerhouse capable of challenging Bloomberg’s market leading $11 billion revenue and towering over the proposed $27 billion acquisition of Refintiv by the London Stock Exchange (LSE). The combined company will benefit from increased scale, a wider product portfolio and a...

EVENT

RegTech Summit New York City

Now in its 5th year, the RegTech Summit in NYC explores how the North American financial services industry can leverage technology to drive innovation, cut costs and support regulatory change.

GUIDE

Entity Data Management Handbook – Seventh Edition

Sourcing entity data and ensuring efficient and effective entity data management is a challenge for many financial institutions as volumes of data rise, more regulations require entity data in reporting, and the fight again financial crime is escalated by bad actors using increasingly sophisticated techniques to attack processes and systems. That said, based on best...