ICI Shows Rebound in MMF Assets
"`Total money market mutual fund assets increased by $9.00 billion to $3.656 trillion for the week ended Wednesday, July 22, the Investment Company Institute reported today. Taxable government funds decreased by $6.45 billion, taxable non-government funds increased by $19.09 billion, and tax-exempt funds decreased by $3.65 billion." In other news, Stradley Ronon Counsel Joan Ohlbaum Swirsky has published a "Fund Alert, Regulatory Analysis" entitled, "Money Market Fund Reform: SEC Proposes Rule Amendments and Seeks Comment on Fundamental Issues". It says, "On June 30, 2009, the SEC proposed amendments to Rule 2a-7, the money market fund rule under the Investment Company Act of 1940. The amendments were designed to increase the resilience of money market funds to economic stresses, reduce the risks of runs on the funds, facilitate the orderly liquidation of a money market fund that breaks the dollar and liquidates, and improve the SEC's oversight of money market funds. Among other things, the proposed amendments would: tighten quality, maturity and liquidity requirements (including imposing new requirements for repurchase agreements); require monthly Web site disclosure of portfolio holdings and additional monthly reporting to the SEC; require each money market fund Board to determine that the money market fund has the capacity to process share transactions at other than $1.00 (that is, after the fund has broken the dollar); expand permission for affiliates to 'bail out' troubled money market funds; and, allow each money market fund Board to suspend redemptions when the money market fund liquidates. The SEC's release (the release) also requests public comment on possible fundamental reform of money market funds; more specifically, whether the stable $1.00 share price should be abandoned in favor of a floating net asset value (NAV) per share and whether money market funds should be required to satisfy redemption requests in excess of a certain size through in-kind redemptions." (See Stradley's "List of Rule 2a-7 Proposals" and "Summary of Rule 2a-7 Proposals" here.)
