Hedge fund firm Man Group has been able to unlock $550 million in
capital following a change in its regulatory status that has reduced its
corporate risk profile.
The reduction reflects the less balance sheet-intensive nature of the group's activities relative to earlier years, such as fund seeding activities and the scale of its guaranteed products business, Man said in a statement on Thursday.
The change in Man's classification has been confirmed by the U.K. Financial Conduct Authority. Previously, the firm was in a category that required higher capital levels to offset risk.
Man Group's change in status frees up $300 million from the removal of a mandatory capital planning buffer. It will also be able to add a further $250 million to its cash reserves because of the reduced capital requirements of its new status.
This will take its total surplus capital to around $920 million from Jan 1, 2014, taking into account its existing cash reserves.
Man's shares were up more than 7 percent by 7:27 a.m. GMT.
Most Popular Stories
- Fantasy Football Gambling Industry Facing Increased Legal Scrutiny
- As States Legalize Pot, Will Traffic Deaths Rise?
- NATO Plans High-Readiness Force to Counter Russia
- Obama Promoting Economic Gains As Elections Near
- 'Guardians of the Galaxy' Conquers the North American Box Office with $16.3M
- GE Capital and Petters-Related Fund in Legal Battle
- California Conservation Conundrum: Water Use Varies Greatly Across State
- Combating Online Abuse Not Easy for Gamers
- Even With Surly 2014 Electorate, It's 'Still an Incumbent's World'
- Feds Want Nuclear Waste Train, but Nowhere to Go