Funds pass organisation's health-check

The Investment Management Association (IMA) has released an updated report on the financial health of UK-based investment funds.

Private banking wealth management customers were assured by the group that authorised funds remain ’generally robust’, despite the extraordinary market pressures of recent months.

According to the IMA, just seven out of 2,350 have faced suspension over the January 2008-March 2009 period.

This is despite extreme volatility caused by the credit crunch, which saw the FTSE 100 index plunging by 20 per cent over a single week at the zenith of the crisis last October.

Despite the low ratio of suspensions - and the fact that the majority of funds included in this total were aimed at sophisticated investors rather than the general public - the IMA recommended in its report that protection controls in the sector be strengthened in future.

Julie Patterson, director of authorised funds and tax at the group, said: ’It is encouraging that the regulatory regime and industry practice have ensured that authorised funds have stood up well in the current crisis.

’As a result of this due diligence exercise we shall be taking forward a small number of recommendations where it is thought that rules could usefully be clarified or industry practice more fully articulated, in order to strengthen the regime further.’ ADNFCR-2318-ID-19207432-ADNFCR