FRA passes new rules for investment funds established by banks, non-banking financial services firms
FRA passes new rules for investment funds established by banks, non-banking financial services firms: The Financial Regulatory Authority (FRA) issued new regulations to govern the establishment of investment funds, FRA boss Mohamed Omran said in a statement yesterday carried by Youm7. The new regulations allow banks, micro financing firms, insurance companies, as well brokerage and securities firms to set up any type of investment fund apart from real estate, independently or with local, regional, or international partners, after obtaining FRA and central bank approval. They also stipulate that securities firms — which received the greenlight last month from FRA to establish mutual funds — need to have been in the market for at least three years to seek regulatory approval. Institutions also need to set aside a minimum EGP 5 mn for fund activities and provide at least 51% of that amount, according to Omran.
In related news, the FRA also signed off on new regulations that allow insurance companies to invest up to 40% of their available reserve in securities, up from 30% previously, FRA deputy head Khaled El Nashar tells Reuters’ Arabic service. Companies can choose to invest in listed or non-listed securities, according to the new regulations, which FRA’s board approved at the end of April.