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In aggregate, the top ten banks and asset managers total $ trillion and $ trillion in assets respectively. The world’s largest asset manager (Blackrock) is around a third larger than the biggest bank (ICBC). But, on the other side, nine of the top 10 banks are larger than their asset management equivalents. On the face of it, then, the structure of banking and asset management is not too dissimilar. But the risks to these balance sheets are also quite different. As an agency function, asset managers do not bear credit, market and liquidity risk on their portfolios. Currently, Blackrock has over $ trillion of assets under management, but has only $ billion of assets of its own. 5 Fluctuations in asset values do not threaten the insolvency of an asset manager as they would a bank. Asset managers are, to a large extent, insolvency-remote. They are not, however, insolvency-immune. An individual manager or fund does face operational and reputational risk – for example, arising from a Maxwell Pensioners-sized fraud or an Arthur Andersen-shaped reputational hit. We have seen examples of this in the past – the large outflows from Gartmore’s funds following the departure of key staff prior to its acquisition by Henderson; or the outflows from Axa Rosenberg in 2011 following an alleged fraud. Nonetheless, if these are the sources of insolvency, then failure of an asset manager is likely to be different than for banks. Fraud and reputational risk tend be idiosyncratic.