"No-action" letters from money funds requesting permission to support troubled securities continue to trickle in on the Securities & Exchange Commission's "Division of Investment Management Staff No-Action and Interpretive Letters" web page. The latest is for Allianz Dresdner Daily Asset Fund, advisor Dresdner Advisors LLC, and parents Dresdner Bank AG and Allianz AG. While the fund is a money market fund under the Investment Company Act of 1940, we don't track it and see no other listings of the fund. It may be a variable annuity vehicle or an "offshore" fund; we're seeking clarification.

The fund had requested permission to purchase $110 million of Sigma Finance securities, which represented 3.67% of the $3 billion fund. The Allianz fund becomes the second money fund advisor to disclose the purchase of Sigma, which is still an "Eligible Security" under Rule 2a-7. The May 2 letter says, "Due to current conditions in the credit markets, including the illiquidity of certain types of asset-backed debt instruments, including the Securities, the current market value of the Securities, as determined by an independent third-party pricing agent, is less than its amortized cost value. The Adviser and the Trust's Board of Trustees continue to monitor the extent of the deviation between the net asset value per share of the Fund determined using amortized cost and market value."

The "no-action" letter continues, "The Adviser has determined that it would be advisable to sell the securities. However, because of the absence of liquidity in the market ... the Adviser believes ... that it would not be in the best interests of the Fund and its shareholders to dispose of the Securities in the market. Nonetheless, subject to obtaining the no-action assurance requested in this letter, the Purchaser is prepared to purchase the Securities in their entirety from the Fund for cash at each Security's amortized cost (including accrued and unpaid interest)." Allianz becomes the 17th advisor to disclose support actions for money market funds.

Another letter was also posted to the SEC site. HSBC Global Asset Management filed to extend a termination date on its previously disclosed "letter of indemnity" to protect the NAV of the HSBC Investor Money Market Fund. The June 25 letter requests an extension of the support termination date from June 24, 2008, to Dec. 31, 2008. To see the full list of SEC "no-action" letters released to date, click here.

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