Global Trustee and Fiduciary Services Bite-Sized Issue 4 2025

10 QUICK LINKS BENCHMARKSREGULATION CMU/SIU DORA FINTECH IOSCO MIFID II/MIFIR SUSTAINABLE FINANCE/ESG ASIA PACIFIC EUROPE NORTH AMERICA UNITED KINGDOM Global Trustee and Fiduciary Services Bite-Sized | Issue 4 | 2025 MAS says two possible fund structures have been proposed that can cater to different investor preferences: • The first option is a fund structure that makes direct private market investments (Direct Fund), which allows for greater visibility of the underlying assets. • The second option is a long-term investment fund-of-funds (LIFF) structure that primarily invests in other private market investment funds, which is beneficial for investors who may wish to tap on the LIFF manager’s expertise in selecting and monitoring a diversified portfolio of private market investment funds. Given that the two structures may require different regulatory safeguards, MAS says it is consulting on the appropriate regulatory requirements needed for each of them. MAS is also seeking views on the scope of private market investment assets that can be suitably offered to retail investors. MAS invites views from interested parties on the proposals set out in the consultation paper by 26 May 2025. Link to MASWebsite here SFC Issues Additional Guidance on IPO Subscription and Financing Services On 22 March 2025, the SFC issued additional guidance in a circular for licensed corporations (LCs) on IPO subscription and financing services to enhance their risk management practices and protect investors from undue financial risks. The SFC says that this came after it identified deficiencies in a recently-completed review of the IPO financing activities of selected LCs. In particular, some of the LCs were found to have engaged in imprudent and aggressive IPO financing practices by accepting subscription orders that exceed their clients’ financial capabilities. In some cases, the LCs primarily focused on the subscription levels or anticipated subscription rates of IPO stocks rather than the financial positions of clients, which could result in over- leveraging for clients and subject LCs themselves to an increased client default risk. The additional guidance in the circular sets out the SFC’s expected standards of conduct and control measures for LCs. These include the collection of minimum upfront subscription deposits, financial assessments of both the firm and its clients, proper segregation of clients’ subscription deposits, and adherence to the FINI investor identification requirements. Link to Circular here EUROPE ESAs Call for Vigilance Amid Rising Geopolitical and Cyber Risks On 31 March 2025, the three European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) published their Spring 2025 Joint Committee update on risks and vulnerabilities in the EU financial system, which focuses on the challenges linked to geopolitical tensions and cyber risks. The ESAs warn that growing geopolitical tensions and rising cyber risks present significant challenges to financial stability. These include trade disputes, rapidly shifting policies, ongoing international conflicts and the prospect of economic fragmentation which are reshaping global markets, requiring heightened vigilance and adaptability from supervisors and financial entities alike. The ESAs say that financial institutions must navigate growing uncertainties, including exposure to international markets, liquidity risks and the evolving role of artificial intelligence (AI). Thus ensuring resilience in the face of these developments is crucial. The ESAs, therefore, emphasise the need for proactive risk management, stronger cyber resilience and a close monitoring of global financial linkages, including currency risks. As financial markets continue to evolve, the ESAs state that international cooperation and regulatory preparedness will be key to maintaining stability.