ASIC ups product disclosure requirements
The Australian Securities and Investments Commission (ASIC) has increased disclosure requirements around capital protected and derivative products.
Its Regulatory Guide 168 (RG168), which contains ASIC’s Good Disclosure Principles, was updated following key findings from its recent review of 64 Product Disclosure Statements (PDSs) of capital protected products and retail structured or derivative products.
The updated guide recommends that the issuers of these products clearly explain counterparty risk and include supporting financial information to ensure retail investors can assess the issuer’s financial ability to meet its counterparty obligations. It also aims to ensure that disclosure around capital protected products is sufficient in that investors understand and can assess the likelihood of early termination or any other significant limitations of these products, while also ensuring better disclosure of break costs that may apply where an investor seeks to terminate or redeem a product before its maturity date.
“The updated guide will assist issuers of capital protected products and retail structured or derivative products to make more effective disclosure to prospective investors,” ASIC commissioner Greg Medcraft said.
RG168 also encompassed recent reforms to the Corporations Act and regulations relating to shorter, simpler PDSs.
Recommended for you
Adviser losses this week are quadruple the same period a year ago, with the industry falling into negative territory for the last 12 months.
Colonial First State has announced the latest manager to join its Edge managed accounts menu, focusing on providing investors with a strategic income.
Rising advice fees has prompted Radar Results to increase its price guide to a minimum of $3,000 per client to reflect the changing shape of the adviser landscape.
Investment consultancy Ascalon Capital has appointed a new partner, who joins from 20 years at Zenith Investment Partners, as well as a new chief executive amid a “bold new chapter” for the firm.
