ICI Viewpoints

Open Markets or Closed Doors: Europe’s Securitisation Choice

Dinesh Khanna — Fri, 10 Apr 2026 13:58:42 +0000

Open Markets or Closed Doors: Europe’s Securitisation Choice Dinesh Khanna April 10, 2026

Public

Authors:

Fri, 04/10/2026 - 09:58

Securitisation has become a revealing test of Europe’s capital markets ambitions. Both the EU and the UK are revisiting their securitisation frameworks in the name of growth, competitiveness, and better‑functioning markets. That focus is well placed: a healthy securitisation market is a critical mechanism for freeing up bank balance sheets, supporting lending, and mobilising long‑term capital.

Reform should reopen the door for UK and EU institutional investors that have been effectively locked out of global securitisation markets for years. But direction matters. The UK and EU are now pursuing markedly different paths—one moving decisively to widen investor access and reconnect with global markets, the other hesitating at the threshold.

The UK is proposing a more open, outward-facing model that offers broader investor access, including for non-UK securitisations, and aligns with the global norm. The EU’s proposal, while constructive in some respects, remains notably more restrictive with respect to non-EU securitisations. This is not a technical difference. It is a strategic one. It will determine whether securitisation helps Europe build globally competitive capital markets or leaves Europe shut out of the opportunities these investments can offer.

Where the approaches diverge

Securitisation markets, which depend heavily on robust investor participation, deepen when investors participate at scale. This participation depends on three conditions: access to a sufficiently broad pool of assets, the ability to assess risk without disproportionate cost or operational burden, and a framework that allows capital to move across jurisdictions with ease. It is across these three conditions that the EU and UK proposals diverge most clearly.

Investor due diligence

Due diligence rules are there to ensure investors understand what they are buying. However, existing EU and UK rules have constrained investors’ ability to participate in securitisations, particularly in global markets. The UK’s proposal simplifies the framework for both UK and non-UK securitisations, giving investors broader access to global opportunities. The EU’s proposed reforms, in contrast, focus mainly on EU securitisations and leave many of the obstacles for non-EU securitisations in place, continuing to restrict EU investors’ access to global market opportunities.

The EU framework also places a much heavier burden on investors by expecting them to verify that other parties in the transaction have met the EU’s regulatory requirements. If EU investors fail to act as "compliance gatekeepers” they face sanctions. The UK does not impose this burden, recognizing that investors already undertake rigorous due diligence as part of their own risk management. By effectively outsourcing compliance to investors, the EU proposal risks discouraging broader investor participation rather than enabling it. The result is likely to be less liquid, efficient, and ultimately a less resilient EU securitisation market.

Risk retention

Risk retention rules dictate whether investors can participate in securitisations originated outside their jurisdiction on workable terms. Rather than retain a rigid five percent originator retention requirement for investment in non-UK securitisations, the UK is prepared to allow investors to demonstrate the originator’s alignment of interest in other ways.

The EU, by contrast, proposes to maintain a more rigid risk retention framework with limited flexibility for non-EU securitisations.

Disclosures

Disclosure rules determine how readily investors can assess risk and allocate capital. The UK is moving toward a more flexible, principles-based approach. The EU’s proposal introduces some streamlining but retains an excessively prescriptive regime that is operational burdensome, particularly for non-EU securitisations.

The issue is not whether investors receive information. It is whether the form and volume of that information enables or deters participation.

Taken together, these elements determine how attractive and accessible the market is for investors. Whether the EU’s securitisation market ultimately deepens or remains stalled will depend on whether the proposed approach translates into participation at scale.

Why this matters

Securitisation markets compete for capital, with investors allocating across jurisdictions based on relative accessibility, clarity, and opportunity. Where a framework restricts access, capital will move elsewhere.

For the EU, securitisation reform is tied directly to the credibility of the Savings and Investments Union (SIU). If securitisation is to support lending, mobilise capital, and strengthen European capital markets, the framework must reflect how investors actually allocate capital in practice.

The EU’s reform effort is important and welcome. It reflects a recognition that the current framework has not delivered the depth or dynamism Europe needs. But recognition alone is not enough. The outcome will depend on how the reforms are calibrated.

Openness to the global securitisation market is a critical factor in determining whether a domestic market can attract sustained investor participation and build scale over time.

The road ahead

The UK has taken a clear step toward a more open and globally competitive framework. The EU still has the opportunity to do the same. But, on its current path, the EU’s securitisation reforms are likely to fall short of their objectives and to constrain rather than strengthen market development. The result will not just be underperformance, but a persistent and widening competitive disadvantage.

If securitisation is to play a meaningful role in the EU’s capital markets, the regulatory framework must recognise that investor access across jurisdictions is essential to building scale, liquidity, and resilience. The approach must support and encourage investor participation, not dampen it through unnecessary complexity and higher costs.

Global capital will not wait for the EU to open the door. It will move to markets that are more accessible, less burdensome, and more workable for investors. Hesitation carries a clear cost: investment will flow elsewhere, competitiveness will erode, and potential will go unrealised. For a policy initiative as ambitious as the SIU, Europe must pair that ambition with a framework capable of delivering deeper, more mature and liquid securitisation markets.

The choices made today will determine whether Europe opens the door to growth and competitiveness in the years ahead or leaves the door closed.

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ICI Viewpoints

Updating What “Small” Means in Today’s Asset Management Industry

Dinesh Khanna — Wed, 08 Apr 2026 13:52:03 +0000

Updating What “Small” Means in Today’s Asset Management Industry Dinesh Khanna April 8, 2026

Public

Authors:

Amy McDonald

Kelly O'Donnell

Wed, 04/08/2026 - 09:52

In 1982, the asset management industry landscape looked very different. ETFs didn’t exist, most work was done without modern technology, and most people would be lucky to have a beeper, much less a smartphone. While much has changed in the decades since, the SEC’s narrow definitions for small entities have remained virtually unchanged.

Today, those definitions capture less than 1% of funds and less than 3% of advisers. The SEC is required to consider the impact of its rules on small entities, and the current definitions of what “small” means no longer reflect today’s asset management landscape or the diversity of fund complexes and advisers operating within it. The SEC’s recent rule proposal to modernize the definitions of small funds and small advisers is a large and welcome step forward.

Comparing the SEC’s Current Rules With the Proposed Rules

	SEC’s Current Small Entity Definition	SEC’s Proposed Small Entity Definition
Small Fund Complex Threshold	$50 million AUM	$10 billion AUM
Small Adviser Threshold	$25 million AUM	$1 billion AUM
Automatic Threshold Adjustments	None	Ten-year automatic adjustments to the rules’ asset-based thresholds

The proposal would significantly expand the number of funds and advisers that are considered small and would allow the SEC to better analyze future rule proposals’ impacts on small entities. The number of eligible funds and advisers would increase by roughly 200-fold. More importantly, the benefits to these entities in future rulemakings—which could include additional compliance time and tailored or flexible compliance requirements—would be meaningful.

What This Means for Smaller Funds

Compared to larger complexes, smaller fund complexes and advisers tend to operate with more streamlined staffing and technology resources, which can affect both scale and bargaining position with third-party service providers.

As a result, compliance costs often take up a much larger share of their assets. The difference in scale is stark: the average size of an actively managed equity fund at small complexes is about $333 million, compared with an average of about $3.4 billion at larger firms, allowing larger complexes to spread fixed costs across a much broader base.

The Pressures Facing Smaller Funds

Fixed compliance costs spread across fewer assets, leading to higher expense ratios and pressure on net returns

Structural scale advantages that favor larger complexes

A cumulative wave of regulatory requirements that adds to ongoing costs and may not be properly calibrated for the risks such regulations look to mitigate

The result: smaller funds are disproportionately affected, competition narrows, and industry diversity declines.

Protecting a competitive environment where small businesses can compete fairly isn’t a new idea. Congress made it clear in the Regulatory Flexibility Act that regulators should consider how rules affect smaller entities and avoid placing disproportionate burdens on them. It reflects a common-sense reality: a fixed cost that barely registers for a large entity can be a meaningful expense for a smaller one—like asking a national chain and a neighborhood shop to absorb the same costs.

Protecting Competition and Investor Choice

Small entities play an important role in the broader asset management ecosystem. They contribute to competition, innovation, and investor choice—often offering specialized strategies and serving niche markets that larger firms may overlook.

They also play a meaningful role in local communities, supporting jobs, economic development, and investor engagement. In many cases, smaller firms provide more direct access to portfolio managers and senior leadership, fostering closer relationships with investors.

When regulatory burdens fall disproportionately on these firms, the impact goes beyond individual businesses. It can reduce competition, limit investor choice, and narrow the diversity of the asset management landscape.

Designing a Framework That Evolves with the Industry

We look forward to the proposal’s prompt adoption, and its tangible impacts on future rulemakings. By tailoring rule provisions where appropriate and extending compliance dates when it makes sense, the SEC can ensure small funds and advisers are not disproportionately harmed by compliance burdens and can remain competitive within the asset management landscape.

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ICI Viewpoints

Modernizing CIT Operations to Support the Next Phase of Growth

Dinesh Khanna — Mon, 06 Apr 2026 16:33:30 +0000

Modernizing CIT Operations to Support the Next Phase of Growth Dinesh Khanna April 6, 2026

Public

Authors:

John Randall

Tue, 04/07/2026 - 07:18

Collective investment trusts (CITs) have seen rapid growth in recent years, driven by increasing demand from 401(k) and other retirement plan sponsors, advisors, and institutional investors seeking additional cost-efficient and flexible investment structures. That growth has delivered clear benefits for plans and their participants, but it has also placed new strains on operational frameworks that were not designed to support today’s scale or complexity of CIT offerings.

Assets of Large 401(k) Plans Are Increasingly Held in Collective Investment Trusts
Percentage of assets in large 401(k) plans*

* Large 401(k) plans are those that filed Form 5500 Schedule H (typically plans with 100 participants or more).
Note: Assets exclude Direct Filing Entity assets that are reinvested in collective investment trusts. Data prior to 2023 come from the Form 5500 Research data sets released by the Department of Labor. Data for 2023 are preliminary, based on Department of Labor Form 5500 latest data sets.
Source: Investment Company Institute calculations of Department of Labor Form 5500 data. 2025 Investment Company Fact Book, available at https://www.icifactbook.org/pdf/2025-factbook.pdf.

To help address the challenge of modernizing CIT operations, members of ICI’s Bank Trust and Retirement Advisory Committee and Broker Dealer Advisory Committee released An Overview of Operating Collective Investment Trusts at Scale, a white paper that identifies core operational constraints, outlines practical modernization strategies, and offers a framework for implementing operational change across the CIT ecosystem.

Scaling Operations to Match Demand

While CIT adoption has grown rapidly, the operational infrastructure supporting CITs is still evolving. Many operational processes rely on legacy workflows and manual coordination across service providers, creating opportunities for modernization as volumes scale. Rather than reflecting resistance to innovation, we understand that these challenges often stem from structural inertia—CIT systems and processes were originally designed for a much different market environment than exists today or in the future.

ICI’s recently launched CIT resource hub provides a single place for operational, policy, and legal information and resources for our CIT members and committees, including the CIT Advisory Committee and the CIT Administrative Subcommittee.

Automation as a Foundation for Scalable Operations

CITs should consider adopting an operational model centered on automation and relying more heavily on automated processing services. Using mutual funds as an example, the paper suggests a path forward for CITs and provides concrete steps that providers, intermediaries, trustees, and others in the CIT industry can consider taking to modernize existing operational structures.

From Advocacy to Operational Support

The need to modernize CIT operations is becoming even more urgent as policymakers consider further expanding access to these products. Lawmakers are currently considering an ICI-backed bill that would give retirement savers working in the nonprofit, education, and health care sectors access to the same broader range of investment options currently enjoyed by 401(k) plan investors.

The Retirement Fairness for Charities and Educational Institutions Act, which passed the House of Representatives in December 2025 as a provision of the INVEST Act, would allow 403(b) retirement plans to utilize CITs as plan investment options. More than 10 million Americans have 403(b) plans, with $1.5 trillion held in 403(b) plans at the end of Q3 2025.

If enacted, this legislation would further increase demand for CITs—heightening the importance of operational models that can scale efficiently and reliably.

From advocating for greater CIT access across retirement plans to identifying modernization strategies and supporting their implementation, ICI is focused on helping members ensure that CITs can meet rising demand while maintaining the high standards plan sponsors and participants expect.

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ICI Viewpoints

How Funds Help Build the American Dream

Dinesh Khanna — Wed, 01 Apr 2026 15:10:28 +0000

How Funds Help Build the American Dream Dinesh Khanna April 1, 2026

Public

Authors:

Sarah Holden

Jason Seligman

Thu, 04/09/2026 - 08:00

For many savers, a workplace retirement plan isn’t just helpful—it’s the reason saving happens at all. ICI’s latest national survey on Americans’ views of 401(k) and other defined contribution (DC) plans shows just how central these plans are to household financial security. As the nation marks its 250th anniversary, ICI is reflecting on what it means to be invested in America, and this survey is a reminder that the systems most vital to Americans’ financial security aren’t always the most front of mind. By making retirement saving routine and investing accessible, workplace plans help promote the American Dream and give families a pathway from work to long-term opportunity and financial stability.

Workplace Retirement Plans Matter

47% of workplace retirement account owners say they probably would not save for retirement without a plan at work.
92% say payroll deduction makes it easier to save.
83% agree their DC plan offers a good lineup of investment options.

Making it easier to save

Nearly half of DC plan account owners said they probably would not save for retirement without a workplace plan. That number is even higher for people in lower-income households. Automatic contributions through payroll deductions are key to making consistent saving possible.

DC plans also change the way people think about planning for the future. More than 9 in 10 DC account owners surveyed said their plan helps them think about the long term, not just their current needs, and 92% said payroll deduction makes saving easier.

A pathway to opportunity and financial security

For millions of people, workplace plans offer a first experience with long-term investing, helping workers develop confidence in managing their finances over time. DC account owners appreciate the lineup of investment options offered in their plans and benefit from the educational materials provided.

Regular contributions also help workers deal with market volatility. More than 8 in 10 DC account owners agreed that knowing they save from every paycheck makes them less worried about short-term investment performance. By investing their contributions in funds, Americans gain a diversified ownership stake in the economy—and a way to participate in its long-term growth.

Americans want to protect what works

The survey results indicate broad public support for preserving DC plans. A strong majority, 87%, oppose eliminating the tax advantages of DC accounts, and large majorities oppose reducing contribution limits. Respondents also value individual control. More than 9 in 10 agree that retirees should be able to make their own decisions about managing retirement assets and income. And about 8 in 10 oppose proposals to invest all retirement accounts through an option selected by a government-appointed board.

Americans want to preserve workplace retirement plans

87% of Americans oppose eliminating the tax advantages of DC accounts.
77% are confident that 401(k) and other employer-sponsored retirement plan accounts can help people meet their retirement goals.

This strong support is not limited to people who already have retirement accounts. Even among individuals whose households do not currently own a DC plan account or an individual retirement account (IRA), large majorities oppose eliminating (or reducing) the tax advantages. This breadth of support suggests sustained public confidence in a system that helps workers build long-term financial security.

Survey Methodology

ICI research staff designed the survey, and NORC at the University of Chicago administered the survey using the AmeriSpeak® probability-based panel. The national survey, conducted in November and December 2025, covered a total sample of 2,175 individuals aged 18 or older in the United States. Survey results are weighted to be representative of the total population of Americans aged 18 or older. The overall margin of sampling error for the 2025 sample is ± 2.1 percentage points at the 95% confidence level. Read more at “American Views on Defined Contribution Plan Saving, 2025.”

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ICI Viewpoints

A Practical Step Toward Expanding Access to Private Markets Through Regulated Funds

Dinesh Khanna — Tue, 31 Mar 2026 19:06:41 +0000

A Practical Step Toward Expanding Access to Private Markets Through Regulated Funds Dinesh Khanna March 31, 2026

Public

Authors:

Kevin Ercoline

Wed, 04/01/2026 - 07:30

Policymakers across Washington are focused on expanding access to private markets—particularly for retirement savers. The August 2025 Executive Order encouraging broader access to private market investments for 401(k) investors reflects a growing recognition that capital markets have evolved and that long-term investors should be able to participate more fully in that evolution.

The Department of Labor took an important step this week, proposing a rule to give retirement plan sponsors a clearer process for including private market assets in their plan lineups. But that addresses which investments plans can offer. The Securities and Exchange Commission (SEC) has a distinct and equally important role: expanding the way regulated funds can access private markets in the first place. A practical starting point is expanding principles-based co-investment relief to open-end funds.

Finishing What Was Started

A co-investment is a negotiated transaction in which a regulated fund makes a private investment in a company alongside an affiliated private fund managed by the same firm. Done properly, it can help regulated funds access larger or more bespoke opportunities on stronger terms, at better prices, or both, than they otherwise would receive if they were to negotiate these transactions alone—all while existing guardrails ensure retail investors receive equal treatment.

In other words, co-investment relief helps expand investor choice and diversification opportunities to private market assets within the regulated fund framework.

In April 2025, the SEC approved a modernized, principles-based framework for closed-end funds and business development companies (BDCs) that co-invest alongside affiliated private funds in negotiated transactions. That framework recognizes that regulated funds can benefit from participating in larger, more complex private market transactions—provided that strong investor protections are in place.

Notably, open-end funds were included in early versions of the co-investment application but were removed before final approval. In a recent letter, ICI urged the SEC to correct that omission and allow open-end funds to participate under the same conditions that apply to closed-end funds and BDCs as there is no persuasive policy case for excluding open-end funds from this framework.

Investor Protections Remain Intact

Some have expressed concern that allowing open-end funds to co-invest in private transactions could increase the risk that they might not be able to satisfy redemption requests. But liquidity in open-end funds is already governed by the SEC’s Liquidity Risk Management Rule, which limits illiquid investments and requires funds to have robust risk-management programs, overseen by a fund’s board, including its independent directors.

Expanding co-investment relief to open-end funds would not alter those requirements. Open-end funds would remain subject to the same liquidity thresholds and oversight processes that apply today. The change would simply allow them to invest alongside affiliates in negotiated private transactions—on the same terms, at the same price, and in the same class of securities.

Far from weakening safeguards, such relief would help ensure that retail fund investors receive equal treatment and are not disadvantaged in favor of private-funds.

How Open-End Fund Co-Investment Would Work

An adviser managing both a private fund and an open-end fund could allocate a negotiated private market investment across both funds. Here’s how:

The adviser sources a private market opportunity and allocates a portion to each fund under pre-established policies designed to ensure fairness.
Both funds invest in the same securities, at the same time, at the same price, and on the same terms.
The open-end fund remains subject to all existing regulatory requirements—including SEC limits on illiquid holdings, board oversight, valuation standards, and fiduciary duties.

Why this matters for individual investors:

Open-end funds are the primary regulated funds that most Americans utilize for retirement and are often the building blocks of target date funds, which nearly seven in ten 401(k) participants hold.
Unlike closed-end funds or BDCs, open-end funds offer daily liquidity at net asset value and are broadly accessible through standard retirement plans and brokerage platforms.
Including them in the co-investment framework would help extend private market access to everyday retirement savers.

Why This Matters for Retirement Savers

If policymakers are serious about expanding private market access in defined contribution plans, open-end funds must be part of the solution.

Open-end mutual funds remain a primary building block for target date funds and other core retirement offerings, particularly across much of the defined contribution marketplace. Without including open-end funds in the co-investment framework, retail investors’ access to private market opportunities will remain constrained.

Private markets now represent a multi-trillion-dollar segment of global capital and continue to expand as companies stay private longer and leverage alternative funding sources. For long-term investors, including retirement savers, access to these markets can enhance diversification and broaden the opportunity set within professionally managed portfolios.

An Efficient Path Forward

The SEC has already approved a principles-based co-investment framework for closed-end funds and BDCs that many sponsors now operate under. The SEC could build upon this framework by allowing firms that have received principles-based co-investment relief to include affiliated open-end funds under standardized exemptive or no-action relief. This would provide clarity and consistency across the industry without requiring firms to request and obtain individualized amendments.

ICI has recommended that the SEC take this structural approach in expanding co-investment relief to open-end funds. Doing so would streamline implementation, reduce unnecessary procedural burdens, promote administrative efficiency, and allow the agency to focus its resources where they are most needed.

Aligning Policy With Market Reality

Capital markets have shifted meaningfully over the past two decades. Companies are staying private longer, and private markets are playing a larger role in financing economic growth. At the same time, retirement savers continue to rely primarily on regulated funds for diversified, professionally managed market exposure.

Expanding principles-based co-investment relief to open-end funds would not weaken investor protections or alter liquidity standards. It would simply allow open-end funds to participate in negotiated transactions on equal footing with affiliated private funds—consistent with safeguards the SEC has already deemed appropriate for other regulated funds.

If the goal is to broaden access to private markets responsibly, this expanded relief does so in a thoughtful and pragmatic way.

The SEC has an opportunity to take a measured step that enhances diversification, supports capital formation, and aligns regulation with the realities of today’s markets—all while preserving the strong investor protections at the core of the agency’s mission.

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Key Takeaways From ICI's 2026 Investment Management Conference

Dinesh Khanna — Tue, 31 Mar 2026 16:32:39 +0000

Key Takeaways From ICI's 2026 Investment Management Conference Dinesh Khanna March 31, 2026

Public

Authors:

Kevin Coroneos

Tue, 03/31/2026 - 14:32

ICI General Counsel Paul Cellupica and Brian Daly, Director of the SEC’s Division of Investment Management, during a fireside chat at ICI’s Investment Management Conference

The 2026 Investment Management Conference (IMC) drew more than 1,000 legal and compliance professionals to Palm Desert for three days of thoughtful discussions on policy, innovation, and industry evolution.

The big themes running through many of the 2026 IMC panels and speeches were serving investors, adapting to technology, and the importance of the relationship between the industry and its regulators. These themes reflect ICI policy priorities described in our Reimagining the 1940 Act white paper, which was unveiled at last year's IMC.

Transitioning to E-Delivery

As ICI General Counsel Paul Cellupica noted in his welcoming remarks, ICI is committed to moving investing fully into the 21st century so investors can make the most of new technology such as AI. This includes bringing investor communications into the 21^st century by making e-delivery the default communication method. Director of the SEC’s Division of Investment Management Brian Daly and SEC Commissioner Hester Peirce drove home the SEC’s broad support of e-delivery during their respective panels.

Peirce noted in her fireside chat with ICI President & CEO Eric Pan: "A wholehearted embrace of e-delivery would be a better way to steward investor money and respond to the preferences of, particularly, a post-COVID investor population...We all realize that just making either e-delivery the default with an option for paper or just making it the straight default is something that should happen.”

SEC Commissioner Hester Peirce and ICI President and CEO Eric Pan during a fireside chat at ICI’s Investment Management Conference

Reforming the Fund Proxy System

During Please Stop Calling Me: The Case for Fund Proxy Reform, a panel on the increasing costs and inefficiencies of the fund proxy system, ICI Associate General Counsel Amy McDonald shared how difficult it is for funds to obtain sufficient shareholder votes on important decisions that require a quorum. Drawing on data from a recent survey ICI conducted of more than 60 member firms, the panelists discussed how the problems with the fund proxy system are getting worse over time.

SEC Commissioner Hester Peirce acknowledged in her remarks the need to modernize the fund proxy system. She cited ICI’s survey findings that fund proxy campaigns since 2020 have cost between $675 million and $1.14 billion, telling the audience the SEC needs industry and investor input to solve the problem.

Driving ETF Innovations

The SEC has approved 48 ETF share class applications since November. As firms are preparing for implementation, the IMC panel Eying the Future: ETFs in 2026 and Beyond looked to the future, examining how ETF growth is influencing firm strategy, operational considerations, and investor adoption. Firms are weighing new opportunities alongside the complexities and operational challenges that come with a rapidly evolving ETF landscape.

ICI strongly advocated for this modernized regulatory framework for ETFs—and the SEC’s Division of Investment Management Director, Brian Daly, noted that the industry is overdue for such modernization. During a fireside chat with ICI General Counsel Paul Cellupica, he welcomed more ideas to modernize the investor experience, observing: “If there is something that could improve outcomes for retail investors that could rationalize, modernize, do any of these good things we came here to do, we want to know about it.”

ICI’s Tom Quaadman moderates the Capitol Insights: Navigating Today’s Advocacy Climate panel alongside Dimensional Fund Advisors’ Catherine Newell, T. Rowe Price’s Bob Grohowski, and Edward Jones Investments’ Andy Blocker

Looking Ahead

Thank you to everyone who joined us in Palm Desert. Session recordings will be available soon on the attendee hub for all IMC attendees.

Next on ICI's conference calendar is Leadership Summit, taking place in Washington, DC, from April 29 to May 1—a must-attend event for industry leaders and executives seeking to shape the future of asset management. National Economic Council Director Kevin Hassett and CFTC Chairman Michael Selig will headline the event.

And don’t forget to save the date for the 2027 Investment Management Conference, taking place March 14 to 17, 2027, in San Diego!

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What to Watch at ICI’s 2026 Investment Management Conference

Kevin Coroneos — Fri, 20 Mar 2026 13:38:35 +0000

What to Watch at ICI’s 2026 Investment Management Conference Kevin Coroneos March 20, 2026

Public

Authors:

Rachel Graham

Erica Evans

Fri, 03/20/2026 - 09:38

Asset management firms are navigating change on several fronts at once, and so are the legal and compliance professionals helping guide them through it. New technologies are reshaping how firms operate and organize their workforces. Evolving product structures are creating fresh questions about governance, disclosure, and investor protection. A shifting regulatory environment is offering new opportunities—and new responsibilities. And through all of it, firms should be thinking carefully about leadership, culture, and talent in new ways.

These issues will converge at ICI’s 2026 Investment Management Conference, convening March 22–25 in Palm Desert, California. This year’s program arrives at an unusually consequential moment—one shaped not just by what’s happening in Washington but by broader shifts in how the industry works, what it offers investors, and how firms themselves are evolving.

A Consequential Year in Washington

The past twelve months have produced a string of tangible policy developments. The SEC has granted exemptive relief for ETF share classes and opened new co-investment pathways for closed-end funds and business development companies. The president's executive order directing the SEC and DOL to facilitate access to alternative assets in defined-contribution retirement plans has set in motion what could be one of the most significant expansions of retirement investment options in years. Policymakers have also turned their attention to digital assets and tokenization. Several of these developments — including ETF share class relief and new co-investment pathways — reflect priorities ICI laid out in its Reimagining the 1940 Act white paper, unveiled at last year's IMC.

IMC will offer attendees the chance to assess what the SEC’s first year under Chairman Atkins’s leadership has meant in practice — and what may come next. Keynote remarks from Division of Investment Management Director Brian Daly and Commissioner Hester Peirce will anchor those conversations, alongside sessions that look beyond the SEC to the broader advocacy climate across Congress, the White House, and other agencies. Attendees will also hear updates on ICI's 1940 Act modernization agenda and the progress made since last year's conference.

Technology, Talent and Corporate Evolution

AI is no longer a future-state conversation for asset management. It is already changing how firms staff, organize, and oversee their operations, and how legal and compliance teams work. This year’s program explores that shift, with a focus on AI’s workforce implications, including the human capital and talent management questions that firms are confronting as roles evolve.

At the same time, the program gives sustained attention to the questions of governance, leadership, and organizational culture that underpin everything else. As firms grow more complex—managing across more product lines, distribution channels, and regulatory regimes—the demands on in-house counsel, chief compliance officers, and fund boards are expanding. How firms lead through that complexity, and how they build cultures that hold up under pressure, may matter as much as any single policy development.

ETFs continue to dominate growth and innovation in the industry. With share class relief granted and firms preparing for implementation, the conversation has moved from whether this innovation will happen to how—and what the legal, structural, and competitive implications will be as it unfolds.

A Broader Mandate

The breadth of this year's program reflects the expansive role of legal and compliance professionals in the industry. The people in the room at IMC are not just interpreting rules and managing risk. They are advising on product strategy, shaping how firms adopt new technology, helping boards navigate unfamiliar territory, and making judgments to ensure that the industry's current wave of innovation serves investors well.

Tuesday's keynote from Shark Tank investor and FUBU founder Daymond John brings an outside perspective to that challenge. His experience building a global brand from scratch, navigating shifts in markets and consumer behavior, and evaluating new ventures offers a different lens on the same questions the conference approaches from a legal and regulatory perspective: how to lead when the landscape is changing faster than the playbook.

IMC has been a fixture of the fund industry's calendar for decades, and this year's edition arrives at a moment when legal and compliance professionals are being asked to do more, across more dimensions, than ever before. It's a chance to take stock of a consequential year, prepare for what's ahead, and compare notes with the peers who are managing the same challenges.

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America Builds With Municipal Bonds: How Regulated Funds Connect Savers to Infrastructure

Dinesh Khanna — Thu, 19 Mar 2026 14:15:08 +0000

America Builds With Municipal Bonds: How Regulated Funds Connect Savers to Infrastructure Dinesh Khanna March 19, 2026

Public

Authors:

Shane Worner

Mon, 03/30/2026 - 17:00

Every school, bridge, water main, and road in America has a financial story behind it. As the nation marks its 250th anniversary, ICI is reflecting on what it means to be Invested in America, and that story starts with infrastructure. For millions of ordinary Americans, their role in this story is through their mutual fund, ETF, or closed-end fund. By pooling the savings of everyday investors and channeling them into the $4.4 trillion municipal bond market, regulated funds have become one of the most important and least recognized engines of American infrastructure financing.

The municipal bond market—which financed landmark projects like the Erie Canal in 1817—today finances roughly 90% of all US public capital expenditure. For most of its history, this market was the exclusive domain of high-income individuals. Regulated funds changed that, broadening access to municipal bonds for everyday investors and strengthening America’s infrastructure in the process. Today, an American saver can easily choose to invest in a fund holding hundreds of bonds across many states, sectors, and maturities, rather than navigating the cumbersome process of constructing a portfolio of individual bonds.

Regulated Funds Support Stable Infrastructure Financing

Beyond the sheer scale of capital they provide, regulated funds contribute to the functioning of the municipal bond market in ways that benefit issuers directly. Municipal bond funds provide a deep, reliable market for state and local debt, which means that governments can bring bonds to market with greater confidence and price them more competitively. Indeed, regulated funds have held a steady share of outstanding municipal securities for many years (Figure 1). At year-end 2010, these funds held 25% of the municipal bond market; by year-end 2025 that share was 29%.

Figure 1: Regulated Funds Channel Investment to Municipal Bond Markets
Percentage of total market value of municipal bonds held by regulated funds, year-end

*Other RICs include ETFs, CEFs, and UITs.
Sources: Investment Company Institute and Federal Reserve Board

That presence extends across the entire country. Capital from regulated funds reaches issuers in all 50 states, meaning that everyday investors participating in the municipal bond market through these tools are underwriting infrastructure in communities from New England to the Rio Grande and from the Pacific Northwest to the Florida Keys (Figure 2).

Figure 2: Municipal Bond Funds Provide Financing to All 50 States
Municipal bond funds’ net assets by state, year-end 2025

¹Municipal bond fund assets by state do not equal total municipal bond fund assets because of a small amount of assets missing state information.
²Data are estimated by dividing municipal bond fund assets by the total market value of individual municipal bonds available in Refinitiv.
Note: Data include mutual funds and ETFs, but exclude money market funds, CEFs, and UITs, therefore statistics presented are a lower-bound estimate.
Sources: Investment Company Institute, Morningstar Direct, and Refinitiv

Consistent fund demand translates into lower coupon rates and lower borrowing costs for issuers. With hundreds of billions of dollars in annual issuance—municipal bond issuance totaled $582 billion in 2025—these pricing advantages compound into meaningful savings for American communities across the country.

The breadth of what funds finance is equally striking. As of December 31, 2025, mutual fund and ETF assets were deployed across every dimension of American public life, including general government facilities, schools and universities, hospitals, transportation networks, water and wastewater systems, utilities, and housing (Figure 3). Each of these project types are critical for local communities, and funds help provide the necessary financing to make them possible.

Figure 3: Municipal Bond Funds Support a Wide Variety of Public Projects
Percentage of municipal bond fund assets by bond purpose, year-end 2025

*Other includes “recreation and conservation,” “unknown,” and “N/A.”
Note: Data include mutual funds and ETFs, but exclude money market funds, CEFs, and UITs.
Sources: Investment Company Institute and Morningstar Direct

Building the Next 250 Years

For more than two centuries, public finance has helped turn American ambition into American construction. Municipal bonds have long been central to that story, financing the roads, schools, water systems, and other public works that communities depend on. In the modern era, regulated funds have become one of the most important vehicles for channeling the savings of working Americans into the projects that communities rely on every day. As policymakers explore public-private partnerships to expand infrastructure investment, the municipal bond market and the regulated funds that support it remain an indispensable foundation—and a proven model that any new approach should complement, not replace.

As we celebrate 250 years of American independence, the municipal bond market and the regulated funds that invest in it deserve recognition as essential institutions of American civic and economic life. The next 250 years of American infrastructure will depend on them.

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From Roadmap to Reality: EU and UK T+1 Transition Webinar

Dinesh Khanna — Wed, 04 Mar 2026 16:24:44 +0000

From Roadmap to Reality: EU and UK T+1 Transition Webinar Dinesh Khanna March 4, 2026

Public

Authors:

Corrado Camera

Fri, 02/27/2026 - 11:24

On February 26, ICI convened a webinar bringing together leading EU and UK experts to provide the latest developments on the transition to T+1 securities settlement in Europe and the United Kingdom. Nearly 100 participants joined the session, which was designed for ICI members and other market participants across the buy-side, trading, and post-trading ecosystem.

The webinar was moderated by ICI’s RJ Rondini (Senior Director, Securities Operations) and Corrado Camera (Senior Director, Public Policy and Regulation, Global Affairs) and featured Giovanni Sabatini, Chair of the EU T+1 Industry Committee, and Charles Pugh, Deputy to the Chair of the UK Accelerated Settlement Task Force, two senior implementation leaders managing the transition.

Key Takeaways

Momentum is building toward the October 11, 2027, deadline.

Speakers underscored the breadth of technical work underway across both jurisdictions and highlighted a key near-term milestone for cross-border coordination: a joint EU–UK T+1 Testing Plan expected in March 2026.

Early readiness data is encouraging, but implementation must be broad-based.

Discussion of the EU T+1 Industry Committee’s first implementation survey (1,000+ responses) suggested strong engagement across the market, including that 77% of respondents reported having reviewed the high-level roadmap. At the same time, the survey indicated uneven readiness across sectors and firm sizes, reinforcing the importance of broad participation and greater automation across the settlement chain. Speakers noted that Europe’s transition presents unique complexity compared with North America, given multiple markets and currencies and a more fragmented post-trade infrastructure.

Task forces are delivering concrete solutions to operational “pain points.”

Sabatini highlighted recent outputs from the Industry Committee’s task forces focused on three areas central to successful implementation:

Standing Settlement Instructions (SSI): Paola Deantoni (Société Générale) and Emma Johnson (The Value Exchange), co-leads of the SSI Task Force, discussed measures to improve SSI quality and standardisation under T+1, including practices related to place of settlement (PSET), place of safekeeping (PSAF), SSI management and exchange, and transaction-type identifiers.
Partial Settlement: Jesús Sánchez (SIX Group), lead of the Partial Settlement Task Force, presented recommendations aimed at establishing common market practice to make partial settlement the default across European markets and encouraging early adoption.
SFT Optimisation: Marcello Topa (Citi Investor Services), co-lead of the SFT Optimisation Task Force, and Konstantina Travlou (LCH RepoClear) discussed proposals including a “gating event” intended to manage intraday liquidity consumption and improve settlement efficiency as markets transition to T+1.

Looking ahead

Speakers emphasised that 2026 will be a pivotal year as firms of all sizes move from planning to implementation and testing. The EU T+1 Implementation Handbook was highlighted as a practical guide for market participants as the programme advances.

EU T+1 Industry Committee website: link

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The Repo Market Has Vulnerabilities. Mutual Funds Aren’t One of Them

Dinesh Khanna — Fri, 27 Feb 2026 18:28:07 +0000

The Repo Market Has Vulnerabilities. Mutual Funds Aren’t One of Them Dinesh Khanna February 27, 2026

Public

Authors:

Shane Worner

Lei Li

Fri, 02/27/2026 - 13:28

The repo market is essential to government bond markets and the broader financial system. It also finances leveraged trading strategies that are overwhelmingly undertaken by hedge funds, not regulated mutual funds. Yet recent concerns expressed by policymakers, including the Financial Stability Board and the European Central Bank[1], increasingly draw regulated funds into the scope of the debate simply because they appear as counterparties in repo transactions. Acting as a counterparty does not make a mutual fund the source of leverage or the driver of repo‑financed strategies. What matters is not who participates in repo transactions, but how vulnerabilities are generated.

The real vulnerabilities lie in structural leverage, heavy reliance on short-term funding, and concentrated intermediation. The latest report on government bond-backed repo markets, covering roughly $16 trillion in activity, illustrates exactly how those vulnerabilities arise. It points to dependence on overnight funding, concentrated clearing and dealer capacity, and leverage embedded in financing channels as key amplifiers of stress. About half of repo transactions are financed overnight, meaning that funding can disappear precisely when markets come under strain. These are structural vulnerabilities. They are not created by the presence of regulated mutual funds on the other side of a trade.

When repo markets seize up, stress spreads quickly, but misdirecting scrutiny toward regulated funds will not address these mechanisms. Instead, it risks weakening market liquidity while leaving the true vulnerabilities intact.

The Risk Is Structural Leverage, Not Regulated Funds

Regulated mutual funds are not drivers of repo-induced leverage. Their balance sheets operate under strict leverage limits, liquidity requirements, and diversification rules that sharply constrain maturity transformation and balance sheet expansion. They do not rely on unstable short-term funding in the way highly leveraged trading strategies do.

In repo markets, regulated funds typically act as counterparties and liquidity providers, not as sources of fragility. Conflating constrained, regulated fund activity with leveraged financing strategies risks obscuring the real problem and targeting the wrong mechanisms altogether.

Relative-Value Trading Is Not the Vulnerability

That same misplaced focus is often applied to relative-value trades, including cash-futures arbitrage. These trades are sometimes cited as evidence of speculative excess. In practice, they serve an important market function by aligning prices between cash and derivatives markets and supporting liquidity in government bond markets.

The risk does not arise from price-alignment strategies themselves. It arises from how those strategies are financed—through significant leverage, short-term funding, and reliance on concentrated intermediaries. Targeting regulated funds does nothing to address those financing mechanics.

Focus on Activities, Not Labels

Effective policy should target the activities that create systemic risk, including excessive leverage, fragile short-term funding, and concentrated clearing and intermediation, not institutions that are already tightly regulated and structurally constrained.

Misdiagnosis carries consequences. Broad or misdirected measures could reduce liquidity in government bond markets, impair price discovery, and weaken resilience while leaving the true drivers of instability intact. If policymakers misidentify how systemic risk is transmitted, they risk directing regulatory tools at the wrong targets and constraining sovereign market liquidity without addressing the mechanisms that generate instability. The priority should be better data, sharper monitoring of leverage and funding pressures, and targeted responses to structural weaknesses.

Getting this right strengthens market resilience. Getting it wrong risks undermining one of the most critical funding markets in the global financial system without solving the problem.

Notes

[1] See ECB (2024): “Financial stability risks from basis trades in the US Treasury and euro area government bond markets”, Financial Stability Review, May 2024;
BIS (2025): “Sizing up hedge funds' relative value trades in US Treasuries and interest rate swaps”, BIS Quarterly Review, December 2025;
FSB (2025): “FSB Workplan to Address Nonbank Data Challenges”, which announces work on leveraged trading strategies in core financial markets.

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ICI Viewpoints

Open Markets or Closed Doors: Europe’s Securitisation Choice

Where the approaches diverge

Investor due diligence

Risk retention

Disclosures

Why this matters

The road ahead

Updating What “Small” Means in Today’s Asset Management Industry

Comparing the SEC’s Current Rules With the Proposed Rules

What This Means for Smaller Funds

The Pressures Facing Smaller Funds

Protecting Competition and Investor Choice

Designing a Framework That Evolves with the Industry

Modernizing CIT Operations to Support the Next Phase of Growth

Assets of Large 401(k) Plans Are Increasingly Held in Collective Investment Trusts Percentage of assets in large 401(k) plans*

Scaling Operations to Match Demand

Automation as a Foundation for Scalable Operations

From Advocacy to Operational Support

How Funds Help Build the American Dream

Workplace Retirement Plans Matter

Making it easier to save

A pathway to opportunity and financial security

Americans want to protect what works

Americans want to preserve workplace retirement plans

Survey Methodology

A Practical Step Toward Expanding Access to Private Markets Through Regulated Funds

Finishing What Was Started

Investor Protections Remain Intact

How Open-End Fund Co-Investment Would Work

Why this matters for individual investors:

Why This Matters for Retirement Savers

An Efficient Path Forward

Aligning Policy With Market Reality

Key Takeaways From ICI's 2026 Investment Management Conference

ICI General Counsel Paul Cellupica and Brian Daly, Director of the SEC’s Division of Investment Management, during a fireside chat at ICI’s Investment Management Conference

Transitioning to E-Delivery

SEC Commissioner Hester Peirce and ICI President and CEO Eric Pan during a fireside chat at ICI’s Investment Management Conference

Reforming the Fund Proxy System

Driving ETF Innovations

ICI’s Tom Quaadman moderates the Capitol Insights: Navigating Today’s Advocacy Climate panel alongside Dimensional Fund Advisors’ Catherine Newell, T. Rowe Price’s Bob Grohowski, and Edward Jones Investments’ Andy Blocker

Looking Ahead

What to Watch at ICI’s 2026 Investment Management Conference

A Consequential Year in Washington

Technology, Talent and Corporate Evolution

A Broader Mandate

America Builds With Municipal Bonds: How Regulated Funds Connect Savers to Infrastructure

Regulated Funds Support Stable Infrastructure Financing

Figure 1: Regulated Funds Channel Investment to Municipal Bond MarketsPercentage of total market value of municipal bonds held by regulated funds, year-end

Figure 2: Municipal Bond Funds Provide Financing to All 50 StatesMunicipal bond funds’ net assets by state, year-end 2025

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Figure 3: Municipal Bond Funds Support a Wide Variety of Public Projects Percentage of municipal bond fund assets by bond purpose, year-end 2025

Building the Next 250 Years

From Roadmap to Reality: EU and UK T+1 Transition Webinar

Key Takeaways

Momentum is building toward the October 11, 2027, deadline.

Early readiness data is encouraging, but implementation must be broad-based.

Task forces are delivering concrete solutions to operational “pain points.”

Looking ahead

The Repo Market Has Vulnerabilities. Mutual Funds Aren’t One of Them

The Risk Is Structural Leverage, Not Regulated Funds

Relative-Value Trading Is Not the Vulnerability

Focus on Activities, Not Labels

Notes

Assets of Large 401(k) Plans Are Increasingly Held in Collective Investment Trusts
Percentage of assets in large 401(k) plans*

Figure 1: Regulated Funds Channel Investment to Municipal Bond Markets
Percentage of total market value of municipal bonds held by regulated funds, year-end

Figure 2: Municipal Bond Funds Provide Financing to All 50 States
Municipal bond funds’ net assets by state, year-end 2025

Figure 3: Municipal Bond Funds Support a Wide Variety of Public Projects
Percentage of municipal bond fund assets by bond purpose, year-end 2025