AIFMD evaluation: watch this space

The European Commission’s recent evaluation of the directive leaves the industry unsure as to what will happen next

Last month, after a three-year wait, the European Commission issued its evaluation of the impacts of AIFMD to date, to the European Parliament and Council.

The evaluation, based on a review carried out by KPMG back in 2017, notably does not contain any proposals to amend the directive, but it’s possible they may follow in due course.

With no concrete action points or proposals, what was the purpose of the evaluation and what does it mean going forward?

WATCH: Data strategies for a digital world

Alice Murray speaks to eVestment’s Katey Bogue about how private capital funds are harnessing data to improve operations and performance

• The industry’s tech evolution

The classic adage in the private capital funds market is that it has been slow to adopt new technologies. It finally feels like that is changing. But why now?

Bogue explains the two key drivers behind this. First, the impact of the 2008 downturn, causing LPs to better analyse private portfolios and understand exposures. Second, advances in technology, such as performance and CRM systems.

• The starting point for data management

As the volume of data PE firms now have - these large data lakes: what are the first steps?

Bogue shares insights from working with a range of clients on cleaning up their data. She asserts that the most important thing is data harmonisation; in almost every case the data you care about is in different places (cashflow data with admin, deal cash flows in excel, deal attributes might be in a portco system) but what you need to do is to bring all of that together.

Bogue advises that it’s best to look at individual areas or smaller chunks to start with so you can focus and learn, then move onto the next.

ILPA unveils deal-by-deal model LPA

The Institutional Limited Partners Association (ILPA) has released its second publicly available “deal-by-deal” model limited partnership agreement (DBD LPA) for private equity.

This latest model comes off the back of strong demands for a template to use for a DBD structured agreement. According to ILPA’s CEO Steve Nelson, the model will enable GPs to reduce their fundraising time and cost as they structure new funds.

LISTEN: RFA’s George Ralph on data pt3

Our third and final instalment of The Drawdown’s conversation with RFA’s George Ralph looks as LP expectations when it comes to data management and ways to boost transparency.

According to Ralph, LPs are typically only focusing on a GP’s data and tech infrastructure during ODD exercises, and DD consultants are looking more closely at how the firm is set up.

While the ODD exercise only provides a snapshot of the GP’s tech infrastructure, firms developing and improving their systems and data applications are doing so in a more transparent manner, with increased capabilities for sharing development work with investors throughout the life of the fund.

Advances in technology mean there are a growing number of tools providing greater visibility of the underlying systems and data flows, which can then be shared among stakeholders.

Ralph also shares his top tips for selecting new tools and service providers. For more on this, check out our demo guide here.

Click here to listen.

ICYMI, click here to listen to part one, and here for part two.

LIBOR limbo

While it might seem as though there’s plenty of time for managing the transition, if left too late, GPs will have to accept whatever replacement rate they’re given

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