October 11, 2013

Deutsche Bank study shows hedge funds addressing new regulatory hurdles

Deutsche Bank today identified how hedge funds are adopting a wait-and-see approach to compliance with regulation due to the complexity of workload involved, whilst legal, compliance and regulatory matters now rank as the top contributor to their non-investment workload.

Deutsche Bank’s Hedge Fund Consulting Group’s survey of European and US hedge fund managers shows almost a quarter of US hedge fund COOs have seen an increase of up to 75% in the amount of time they dedicate to such issues.

At the same time, hedge funds are taking a wait-and-see approach to compliance with the Alternative Investment Fund Manager Directive (AIFMD), with 82% of European managers intending to delay registration until 2014.

Further highlights of the survey include:

  • Marketing to European investors continues with 35% of European and 43% of US managers choosing to utilise transitional marketing provisions.
  • The amount of time COOs globally dedicate to legal, compliance and regulatory matters has increased significantly - by up to 50% - over the past two years for the majority of managers surveyed.
  • The majority of managers globally estimate their non-headcount related costs have increased by up to 25% over the last two years.
  • More than 40% of managers have hired more than one non-investment full-time employee to help prepare for and manage new regulatory requirements.
  • 39% of managers are uncertain whether AIFMD will bring additional investment from institutional investors.

Daniel Caplan, European Head of Global Prime Finance at Deutsche Bank, said: “The crucial role played by hedge fund COOs has been brought into sharp focus as the regulatory workload continues to mount, and this report provides a valuable insight into how this function has evolved to meet today’s increasingly complex demands.”

The survey polled 44 European and US hedge fund managers representing over $325 billion in assets under management.

Study "Hedge fund COOs rise to new regulatory hurdles"

For further information, please call:

Deutsche Bank AG
Press & Media Relations

Nick Bone
Phone: +44 (0) 207 547 2603
E-Mail: nick.bone@db.com

Oksana Poltavets
Phone: +1 (212) 250 0072
E-Mail: oksana.poltavets@db.com

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