AIFMs subject to the Alternative Investment Fund Managers Directive (2011/61/EU; The “AIFMD”) (whether as an alternative investment fund manager (“AIFM”) established in the European Economic Area (“EEA”) that manages an EEA alternative investment fund (“AIF”) or markets an AIF to investors established in the EEA) must comply with the rules of the AIFMD on preferential treatment. The AIFMD requires investors to receive a “description of how the AIFM ensures fair treatment of investors and, where an investor receives preferential treatment or a right to preferential treatment, a description of that preferential treatment, the type of investors receiving such preferential treatment and, where applicable, their legal or economic relationship with the AIF or AIFM”. This disclosure obligation applies before the investment and after significant changes in such preferential treatment. The introductory recitals of the AIFMD also require that any preferential treatment be disclosed in the rules or articles of association of the AIF – this can be achieved through broad disclosure in the private placement memorandum or partnership agreement (although some AIFMs prefer to include tailor-made terms to ensure that investors do not get too much out of a “shopping list”). The possibility of requesting additional information from the AIFM is also often included in the private placement memorandum, with summaries of sub-letter rights usually provided. Here are some practical considerations that might be relevant when managing a fund with letters of guarantee: A financing contract product requires a lump sum investment paid to the seller, which then provides the buyer with a fixed return over a period of time, often with the LIBOR-based return, which has become the world`s most popular benchmark for short-term interest rates. The choice of investment funds has expanded significantly in recent years with the growing trend to offer unit-linked alternatives to popular mutual funds and DEIC funds, which are referred to as externally managed funds as opposed to internally managed funds of life insurance companies. Typically, externally managed fund connections have higher fees; This is tolerated because better yields are expected. The constitutional documents of closed-end funds typically include a mechanism by which an investor may be exempted from participating in certain types of investments (usually due to regulatory or internal restrictions). Often, an investor must inform the fund of any restrictions before investing and/or seek the advice of external legal counsel to confirm that they are so restricted. If a fund is willing to negotiate exclusion rights, it should seek to limit the investor`s discretion in determining what constitutes an excused investment, as the focus should be on fully exploiting the investor`s exposure rather than allowing the investor to select trades. In general, if the size of the prohibited investments is indicated in the letter of guarantee itself, it is useful to indicate why they are prohibited in order to increase the likelihood that the provision does not fall within the scope of a relevant most-favoured-nation law.
This note describes the new data on securities backed by financing agreements (FABS) provided under the Enhanced Financial Accounts (EFA) initiative. As described in Holmquist and Perozek (2016), the U.S. financial accounts report quarterly on the total amount of outstanding fobs. This EFA project extends financial account data by providing daily data for different types of FABS, which differ depending on the degree of maturity and the integrated option. The more detailed data presented in this EFA project provide a clearer picture of the evolution of this important financing market, including the rush to a segment of the FABS market from the summer of 2007 (Foley-Fisher, Narajabad and Verani 2015). The project thus promotes the objectives of the EFA initiative – described in Gallin and Smith (2014) – to provide a more detailed and common picture of financial intermediation in the United States. Unitized insurance funds or unit-linked insurance funds are a form of collective investment offered to life insurance policies.  8. The movement of life insurers towards PFHLBs is part of a broader evolution of shadow banking towards the FHLB system. See Acharya, Afonso and Kovner (2013). .