European Union (EU) regulators are assessing the potential threat to the financial system that a run on fixed-income funds could pose when central banks change course on monetary policy.

The size of the asset management industry has "raised issues about what happens in the case of a reversal in interest rates" that prompts investors to pull out their money, said Steven Maijoor, head of the European Securities and Markets Authority (ESMA). Regulators "need to look seriously into this issue, collect the evidence, and understand as well as possible the risks," he said.

"Redemptions played a role in the financial crisis," Maijoor said in an April 24 interview in Riga, Latvia. "Asset managers coped quite well with the reversals in the values at that time, but there's no guarantee of that in the future."

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

  • Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM websites including and

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.