United Kingdom: FCA Sets Out Findings from Private Market Valuations Review

In brief

In a recently published Dear CEO letter detailing its Supervisory Strategy for the asset management sector, the FCA expresses concern as to how valuations in private markets are conducted, and details the risks arising from incorrect valuations (including, for example, levying inappropriate charges on investors where valuations linked to the calculation of management fees). The FCA's multi-firm review of private market valuation practices sets out the regulator's approach to private market valuations, identifying examples of good practice and areas for improvement. Asset managers should review these findings alongside consideration of the priorities identified in the Dear CEO letter to ensure they are taking an appropriate approach to risk management.

For more on the FCA's Supervisory Strategy for the asset management sector, see our related briefing.

ACCESS FULL ALERT