Revised Loan Funds Rules Framework published by MFSA

The Malta Financial Services Authority (MFSA) this week published an updated version of the Standard Licence Conditions applicable to Collective Investment Schemes authorised to invest through loans.

The objective for the revision of the MFSA Loan Funds regime is for the Authority to achieve a better balance between the need for a sound regulatory framework and to make such regime more pragmatic and accessible to the fund industry given market developments and particularly, the current economic scenario, where certain businesses may be finding it increasingly difficult to gain access to capital through traditional lending sources.

The MFSA also took note of the relevant EU regulatory developments and, notably, the focus being placed on the area of non-bank financing by the European Commission, within

the wider context of the Capital Markets Union. Besides, due consideration was given to the feedback provided by the industry to the Authority since the framework was set up.

MFSA’s chief officer Supervision and chief Executive officer Ad Interim Dr Christopher P. Buttigieg commented that: “This marks the attainment of one of the first key milestones forming part of the overarching MFSA Asset Management strategy related initiatives. This strategy is aimed at strengthening Malta’s position as an asset management jurisdiction, also demonstrating the Authority’s commitment to contributing towards the sustained development of this sector.”

Clare Farrugia, head of Strategy, Policy, and Innovation, noted that: “In effecting these amendments, the Authority has carefully re-evaluated its regulatory approach to this market, while acknowledging the critical role also played by existing regulation, like the one regulating the alternative investment management sector. The Authority believes that the updated framework should provide the industry with a more pragmatic, but nonetheless, robust regime.”

Any authorisations related queries in respect of the revised Loan Funds Rules framework are to be addressed to: ausecurities@mfsa.mt, while supervision queries are to be addressed to: funds@mfsa.mt