Risks from asset managers to get more SEC scrutiny

(Bloomberg) — The U.S. Securities and Exchange Commission is considering an increase in its oversight of the risk posed by large asset managers such as Blackrock Inc.

The agency’s staff is drafting a plan to expand its stress testing of money-market funds and require more robust reporting of data, SEC Chairman Mary Jo White said in a speech today in Washington. The effort draws on the work of former portfolio managers and investment analysts who now work at the SEC, White told a conference sponsored by the Practicing Law Institute.

A study issued last year by Treasury’s Office of Financial Research said money managers could endanger the financial system when reaching for higher returns, herding into popular asset classes, or amplifying price movements with leverage. White told the Senate Banking Committee this month that the SEC “agreed to disagree” with Treasury economists on some of the study’s findings.