ESMA finalises rules for open-ended loan-originating AIFs
27 Feb 2026
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The European Securities and Markets Authority (ESMA), in October 2025, published its final draft Regulatory Technical Standards (RTS) for open-ended loan-originating Alternative Investment Funds under the AIFMD. These standards focused on liquidity management, stress testing and redemption policies for open-ended AIFs.
Key provisions include:
- Liquidity management: AIFMs must ensure sufficient liquidity to meet redemption requests, considering factors like loan maturities, cash flows, and investor behaviour. The RTS removed the earlier proposed requirement to hold a fixed proportion or “target amount” of liquid assets.
- Stress testing: Annual liquidity stress tests are mandatory, with higher frequencies required for specific fund characteristics.
- Redemption policies: AIFMs must align redemption terms with the fund's liquidity profile and investment strategy.
The RTS aim to synchronise practices across the EU, boosting investor protection and financial stability. The draft has been submitted to the European Commission for adoption, with adoption not expected before 1 October 2027.
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