The October issue of Crane Data's Money Fund Intelligence was sent to subscribers on Monday morning. The latest issue of our flagship monthly newsletter features the articles: "Comments on MMF Reform Oppose Float, But Diverge," which review the 208 Comment Letters on the SEC's MMF Reform Proposal; "Fidelity's Prior Discusses Comment Letter, Future," which interviews the head of the largest money market group and reviews their feedback to the SEC; and, "Debt Ceiling & Risks to Treasury Funds, Holdings," which discusses the remote threat of a default and its possible impact on Treasury money funds and holdings. We've also updated our Money Fund Wisdom database query system with Sept. 30, 2013, performance statistics and rankings, and also sent out our MFI XLS. (MFI, MFI XLS and our Crane Index products are available to subscribers at our Content center.) Our September 30 Money Fund Portfolio Holdings are scheduled to go out late on Wednesday, Oct. 9 (with the "Reports" out on Oct. 10).
Our SEC Comment Letter piece says, "The deadline for Comments on the SEC's Money Market Fund Reform Proposal passed on September 17, and the 208 letters of substance and 1,200+ form letters overwhelmingly oppose a floating NAV for prime institutional funds (Alternative I). But opposition isn't as monolithic as previous requests for comment (by the SEC, PWG and FSOC), indicating that many are resigned to substantial changes to prime funds (and reflective of the partial nature of the proposal). The letters also in general supported the exemption of tax-exempt money funds from both alternatives, and supported the emergency liquidity fees and gates option. We review comments from the major MMF providers below."
The October issue's lead story continues, "Unsurprisingly, the majority of the comment letters came from money fund managers, investor groups, and interested parties, with a sprinkling of submissions from regulators and fringe economists. A table on page 3 shows where the 15 largest money fund managers came down on many of the major issues."
Our "profile" on Fidelity's Nancy Prior says, "This month, we again interview Fidelity Investment's Money Market Group President Nancy Prior, and ask about Fidelity's recent comment letter on the SEC's Money Market Fund Reform Proposal, as well as several other topics. (See our previous June 2012 MFI interview, "New Queen of Cash: Fidelity's Nancy Prior.") Fidelity manages over $425 billion in money fund assets, over 17.0% of the total $2.6 trillion. Our Q&A follows."
The piece asks, "What was the main thrust to your comment letter?" Prior comments, "Overall, we think that the SEC has taken the right approach, which was to narrowly tailor the reform proposals at those funds that have shown that they may be susceptible to large redemptions. `But we think in the execution of that approach, there were some areas where the SEC nailed it but also some missteps. With respect to Treasury and government money market funds, we think they got it right. Those funds have shown that they are not susceptible to runs. So we think the SEC was right to exclude those funds from reform. But where we think they really missed the mark is with respect to the municipal funds. We firmly believe that the municipal funds should not be subject to either the floating NAV or the fees and gates proposal."
The article on the Debt Ceiling & Treasury Funds explains, "With the partial government shutdown in progress, questions and concerns have surfaced over the Treasury's looming debt ceiling. While we're confident that the limit will be raised, as it was in August 2011, we wanted to address some potential risks and implications to Treasury money funds, T-bill holdings and money funds in general." See the latest issue and future "News" postings for more details, or contact us to request the latest issue.
Finally, we also wanted to thanks our sponsors, speakers and attendees from last month's Crane's European Money Fund Symposium, which was held Sept. 24-25 <b:>`_in `Dublin, Ireland. We had 100 people in total, which we believe makes our inaugural event the largest money fund conference ever held outside the U.S. We plan on having next year's European MF Symposium in London, Sept. 23-24. Our next U.S. event is Crane's Money Fund University, which will take place Jan. 23-24 in Providence, R.I., and which will contain a heavy focus on money fund regulations. Our next big show, Crane's Money Fund Symposium, will take place June 23-25, 2014, in Boston. (Watch for the agenda later this month.)
