After last month’s turmoil in U.S. government bonds, SEC chief Gary Gensler said hedge funds and other areas of the shadow banking system require more oversight, the Financial Times reported on Saturday.
Gensler told the newspaper that lowering speculative fund and non-banking financial institution risks was “more important than ever.”
“We just had Treasury yields move more significantly than they had in 35 years in three days in mid-March,” Gensler told the Financial Times, alluding to the volatility in Treasury bonds last month when Silicon Valley Bank and Signature Bank collapsed quickly.
“When you have that, it’s appropriate as a capital markets regulator to talk to folks and see whether that risk propagates out.”
Last month, the SEC I proposed new requirements to improve private equity and hedge fund monitoring, including reporting “significant stress” incidents within one business day.
The paper stated Gensler had previously highlighted hedge funds as a financial stability issue and that the SEC was in close communication with market players and received quarterly hedge fund reports.
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