"Money fund woes fuel manager flight"
"Money fund woes fuel manager flight" writes this week's Investment News. The article says, "More asset managers are getting out of the money market fund business because the regulatory and market environment often makes offering such funds unprofitable. Aston Asset Management LLC of Chicago, formerly ABN AMRO Asset Management Holdings Inc., became the fifth firm in two years to leave the money fund business when in July it liquidated its money funds, according to Crane Data LLC, a Westborough, Mass., money fund consulting firm. The others are Calamos Advisors LLP of Naperville, Ill., Credit Suisse Asset Management LLC of New York, Munder Capital Management of Birmingham, Mich., Utendahl Capital Management LP of New York and Monarch Investment Advisors LLC of Beverly Hills, Calif. Janus Capital Group Inc. of Denver and Putnam Investment Management LLC of Boston have exited the institutional-money-fund business but still offer retail money funds." The Investment News piece adds, "Largely because of low yields, assets in money funds stood at $3.6 trillion July 29, down $196 billion, or 5.1%, from their level at Dec. 31, according to Crane Data. And because interest rates aren't expected to rise anytime soon, assets will decline by a total of 10% by the end of the year, predicts Peter Crane, president of Crane Data.... It has benefited companies such as Federated, the third-largest money fund manager, with $294 billion in money fund assets at the end of July, according to Crane. During the past few months, Fifth Third Asset Management Inc. of Cincinnati, a unit of Fifth Third Bancorp, and Nationwide Asset Management LLC of Columbus, Ohio, a unit of Nationwide Mutual Insurance Co., outsourced money fund management to Federated, according to Crane. Other firms that have benefited from the current environment include Fidelity Investments of Boston, the largest money fund manager, with $506.33 billion in money fund assets, which received money fund assets from Capital One Asset Management LLC of New Orleans, a unit of Capital One Financial Corp. of McLean, Va. State Street Global Advisors of Boston, the 18th-largest money fund manager, with $49.68 billion in such assets, received money fund assets from Neuberger Berman LLC of New York."
