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Discretionary Investment Management

Discretionary investment managers (DIMs) provide a critical role on the buy side and play an invaluable role in managing their clients assets. Most small and medium sized DIMs are authorised for both advisory and investment management permissions with a combination of agency dealing and custody or arranging custody permissions. As such, most DIMs are classed as being either BIPRU50K firms or IFPRU125K firms for prudential purposes.

On top of having to meet several requirements stemming from regulations such as MiFIDII, GDPR, and MAR, DIMs have increasingly faced the challenges of passporting post-Brexit. Outside the challenges of post-Brexit, implementation of the new prudential regime for investment firms known as IFPR might pose a challenge to several small and medium DIMs. Some DIMs also operate and manage AIFs (alternative investment funds) or UCITs funds (undertakings for collective investment in transferable securities) and come within the respective AIFM and UCITS regulations on top of MiFID.

For regulatory purposes such firms are known as collective portfolio management investment firms (CPMIs).  Some DIMs choose to make use of a regulatory hosting platform to avoid being directly authorised by the FCA and operate as an appointed representative of a principal firm instead. However, others decide to be authorised and regulated directly providing flexibility. Our Consultants have tremendous experience working with DIMs and supporting all regulatory, compliance, and risk functions.

Marble

How Pillar 4 Can Help

Authorisation

> Full application support on a project managed basis from start to finish

> Guidance on navigating the FCA’s current approach to DIMs including key concerns

> Support in formulating the right governance structure for your firm

> Staff skills and competency assessments

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IFPR implementation

> Pro bono initial assessment of the impact of IFPR on your business

> Financial modelling and full implementation of the IFPR and shift from ICAAP to ICARA

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Risk management

> Developing integrated risk management, capital monitoring, and reporting tools

> Developing suitable pillar 2 approaches

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On-going compliance support

> Providing specialist advise

> Revamping compliance monitoring programmes to something practical and workable in  line with regulations

> Providing risk based on-going compliance monitoring and testing 

> Support in regulatory reporting and capital adequacy reporting