Closed-end alternative investment funds will be able to grant loans to legal entities, announced the president of the Association of Fund Administrators in Romania (AAF), Horia Gustă.
„It's a European directive from AIFMD 2 - Alternative Investment Directive 2. Basically, this directive says that alternative investment funds can make several alternative investments. One of them is the possibility to make loans, but they don't lend to the manager, they lend to the manager on behalf of the fund. So, alternative investment funds will be able to make loans, only they will not be able to lend to consumers. It is mainly for legal entities, so not consumers. That's another area. And there are also some diversification rules. That's pretty much what the European legislator said, the directive was transposed into Romanian law. Now, the Financial Supervisory Authority will have to issue by October 16 the text of the law, to come up with secondary regulations to make it happen: who, how, under what criteria”Horia Gustă told Agerpres.
He emphasized that these loans could only be granted by closed-end investment funds.
„Let's not forget one thing: not all types of funds can. Mainly, closed-end alternative investment funds can give loans, that is, those in which investors cannot exit, and then the others can give loans, but they have to be careful to ensure, because you give the loan with payment, I don't know, monthly, quarterly, it depends from case to case, but they have to be careful about the liquidity of the fund, so that when investors come to redeem, there are resources in the fund, not money given as a loan. So, here there must be some adjustments to be made by the administrator on the basis of secondary regulations. The law is published in the Official Gazette in December, it comes into force on April 16, and there are six months until October 16 for the authority to issue secondary regulations, without which no one can start lending. So October 2026 is the deadline for the authority to issue regulations and the market will have three months to adjust”explained the AAF President.
Horia Gustă emphasized that lending will not be compulsory for investment funds, but only a possibility for them.
„It will not be compulsory. Administrators can choose not to lend, but this is a possibility that did not exist until today”he said.
As for the interest rates that will be charged on these loans, the head of the AAF believes they will be higher than those charged by banks, because it is about yields.