The Financial Times writes "New rules for [European] money funds", which says, "Europe's E430bn (L388bn, $630bn) triple-A money market fund industry will have to abide by higher standards of maturity, credit quality, liquidity and disclosure under new guidelines due to be unveiled today. The move follows a series of problems in the supposedly low risk asset class during the credit crisis. A number of 'enhanced' European money market funds suffered double-digit losses and the US Treasury felt compelled to prop up its domestic industry after one vehicle, the Reserve Primary Fund, 'broke the buck', losing money for investors." FT adds, "Although triple-A rated European funds avoided these problems the industry body, the Institutional Money Market Funds Association, has still decided to tighten its guidelines, which are mandatory for members. The move mirrors tighter rules being consulted on by the Committee of European Securities Regulators. Funds will now have to manage liquidity by ensuring at least 5 per cent of assets are held in overnight securities and 20 per cent in securities maturing within one week.... IMMFA has also moved to tighten up credit quality by stipulating that the weighted average final maturity of a fund's assets must be no more than 120 days." The London-based IMMFA will be hosting a conference call to unveil its new Code of Practice, "a set of best practice standards for the management and operation of triple-A money market funds in Europe," on Monday morning at 5am Eastern (10am London).

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