The unprecedented surge in money market mutual fund ratings continues, with a new batch of AAAm's announced by Standard & Poor's. Credit Suisse Institutional Money Market Fund Government was given the highest rating assigned to money funds, 'AAAm', yesterday, while State Street Institutional Tax Free Money Market Fund was given this honor Friday. S&P had also rated the new Barclays Global Investors Euro Government Fund 'AAAm' last week.
S&P's Peter Rizzo says they've rated more than two dozen U.S. and European money funds year-to-date. He says, "We've seen a lot more interest in Treasury and government funds in Europe". The "offshore" market has seen the launch of several Euro government funds. JPM launched its now E3.0 billion JPM Euro Government Liquidity Fund in December and Goldman Sachs launched a Euro Government Liquid Reserves Fund two weeks ago. The first pound sterling "Gilt" money market funds are expected to launch soon too.
The Credit Suisse Govt fund, which had been previously rated 'Aaa' by Moody's "pursues its objective by investing exclusively in obligations issues and/or guaranteed by the U.S. government or by its agencies and instrumentalities and overnight, triparty repurchase agreements collateralized by government securities," says S&P's release.
State Street Tax Free MMF started on Feb. 7, 2007, and "seeks to maximize current income, exempt from federal income taxes, to the extent consistent with preservation of capital and liquidity and the maintenance of a stable $1.00 per share net asset value". The release says the fund, "typically invests in variable-rate demand notes, municipal bonds, and tender option bonds". It adds, "As of April 4, 2008, the fund has no exposure to monoline insurers FGIC or XL Capital."
