ABI reviews Money Market Fund Sectors

by Gill Montia

Story link: ABI reviews Money Market Fund Sectors

The Association of British Insurers (ABI) has announced that it is reviewing the purpose and function of the ABI Fund Sectors.

The sectors categorise different types of investment fund and are used by consumers and financial advisers to compare funds with similar investment profiles.

The ABI’s director general, Stephen Haddrill, explains that “the current economic crisis has highlighted the need for a fundamental review of the ABI Sectors to ensure that they continue to meet the needs of consumers and advisers as risk changes”.

According to Mr Haddrill, the first stage of the review consists of a close examination of the “Money Market” sector which will be followed by proposals on options for reform.

The move follows the revelation last week that Standard Life has agreed to restore the value of its Pension Sterling Fund after it lost just under 5% of its value, or around £1,237 per investor.

The loss pertained to mortgage-backed securities and investors claim that they were not aware that the fund held asset-backed securities, in addition to deposits in banks and building societies.

The ABI review will include consultation with all relevant bodies, including the IMA, FSA, AIFA, consumer organisations and data analysis firms.