Regulatory data – The backbone for special fund providers
In the world of institutional investment, regulatory data is much more than just a compliance issue – it is a strategic success factor. For capital management companies (AIFMs) that manage special AIFs for insurance companies, banks and pension funds, they are essential to ensure transparency, control and supervisory capability. Last but not least, organized handling of data can influence the sales success of individual products.
What is regulatory data?
The term regulatory data includes all information necessary to comply with legal, regulatory and contractual requirements. These include, among others:
- Master data on funds, assets and investors
- Financial metrics such as share price or net asset value
- Risk metrics such as VaR, leverage, liquidity profiles
- Transaction data and valuation information
- Sustainability data according to SFDR and EU taxonomy
- Report formats such as AIFMD reporting, statistics on investment funds
This data is regularly transmitted to supervisory authorities such as BaFin and the Deutsche Bundesbank and is used to monitor the stability of the financial system and to comply with investment restrictions. But its own investors are also regularly recipients of regulatory data. There, they are absolutely necessary to meet their own regulatory requirements – for example, vis-à-vis Eiopa or EBA.
Why is regulatory data so important for special fund providers?
- Trust and transparency towards institutional investors
Insurance companies, institutions and pension funds are themselves subject to strict regulatory requirements – such as the Investment Ordinance (AnlV), Solvency II or CRR III. They therefore need precise, timely and verifiable data from KVG in order to meet their own reporting obligations. A KVG that reliably provides regulatory data becomes a trustworthy partner in this way. - Compliance with regulatory requirements
With the implementation of AIFMD II into German law through the Fund Location Strengthening Act (FoMaStG) and the amendment of the KAGB (e.g. Section 29a KAGB-neu), new requirements for leverage, liquidity management and risk diversification will be introduced. Without robust data management, such requirements are difficult to implement – neither in fund structuring nor in ongoing operations. - Competitive advantage through data literacy
In an increasingly data-driven market environment, the ability not only to provide regulatory data, but also to intelligently analyze it and use it for fund management, is becoming a differentiating feature. KVGs that are well positioned in terms of technology and organisation can react more quickly to market changes and offer innovative products. - Transparency in one’s own audit
Regulatory data is not only relevant for external reporting obligations, but also for the internal and external audit of the KVG itself. Auditors rely on a large number of regulatory data points for the audit of the annual financial statements and for the audit, inter alia in accordance with Section 38 KAGB – for example, on the valuation system, risk management, compliance with investment limits or on the prevention of money laundering. It reduces queries, accelerates review processes and strengthens KVG’s credibility vis-à-vis investors and supervisory authorities. In addition, the KVG makes it possible to identify potential vulnerabilities at an early stage and proactively counteract them – a clear advantage in an increasingly regulated environment. - Audit efficiency and governance
The new audit obligations under Section 45a KAGB now also require registered (small) AIFMs to undergo a comprehensive audit under commercial law and, among other things, to comply with the Money Laundering Act. Regulatory data forms the basis for these audits and enables efficient cooperation with supervisory authorities.
Result
Regulatory data is not an annoying by-product of fund management – it is a key asset. This awareness must grow imperatively. For special fund providers who work with demanding institutional investors, a professional data management system is not just an option, but an absolute must. It creates trust, ensures compliance and opens up new strategic leeway.
