In particular, the Revised Q&A (see Q&A ID 1147 and ID 1101 respectively) set out the Central Bank’s expectations in relation to an alternative investment fund manager or UCITS management company (FMC) operating or planning to operate in the manner of a third party FMC.
The Revised Q&A confirm that where new business results in a material increase in the nature, scale or complexity of an FMC’s business, the Central Bank deems this to be a material change to the FMC’s operating model or basis on which authorisation has been granted. The Central Bank Q&A clarify that such an increase can be through a standalone transaction or on a cumulative basis, and “includes, but is not limited to, material increases in the number of funds under management and/or the number of delegates, and on-boarding of self-managed investment companies who are changing their status to be externally managed.”
The Revised Q&A state that in such circumstances, the FMC is required to notify the Central Bank and to engage proactively with Central Bank supervisors and to ensure that they are appropriately resourced to service the additional business.
The FMC may be required to submit revised financial and business growth (AUM, number of funds/sub funds, number of delegates) projections covering a period of two years as well as detailed assumptions on which the projections are based, an up to date capital plan and current business plan with increased resourcing projections for review.