As we wrote in a Jan. 6, 2010, Crane Data News piece entitled, "Standard and Poor's Requests Comment on MMF Rating Revisions", S&P's Ratings Services is "requesting comments on proposed revisions to its Principal Stability Fund Ratings Criteria." The company's request for comment said, "We encourage all market participants to submit comments in writing on the proposed criteria by March 26, 2010. Please e-mail your written comments to CriteriaComments@standardandpoors.com. Once the comment period is over, we will evaluate the comments and finalize the principal stability fund rating criteria."
The original RFC added, "The proposed changes include: adopting WAM to final maturity criteria (with no change in regular WAMs for AAAm funds); allowing 95% correlations to 3-month LIBOR (in addition to Fed funds) for variable/floating rate indexes; restricting maturities of illiquid securities; tweaking maximum issuer concentrations; adding weekly stress tests; and, eliminating the 'G' designation for government money funds."
In related news, recent S&P Ratings Headlines include: "SSGA Money Market Fund Upgraded To 'AAAm'," "Old Mutual Cash Reserves Fund Rated 'AAAm'," and "TCW Money Market Fund Rating Withdrawn At Investment Advisor's Request." The SSgA release says, "Standard & Poor's Ratings Services said today that it raised its principal stability fund rating on the SSgA Money Market Fund to 'AAAm' from 'Am'."
They explain, "The upgrade is based on the decision of SSgA Funds Management Inc. -- the investment advisor to the fund -- to manage the fund to more conservative weighted average maturity (WAM) guidelines given recent changes to money-market fund regulations.... [B]ecause one of the recent changes to Rule 2a-7 under the Investment Company Act of 1940 will limit the maximum WAM to 60 days for all money-market mutual funds (which includes the SSgA Money Market Fund), the fund will be managed within the 60-day WAM criteria for 'AAAm' rated funds."
The Old Mutual release says S&P "assigned its 'AAAm' principal stability fund rating to the Old Mutual Cash Reserves Fund.... The fund's investment adviser is Old Mutual Capital Inc., which is a wholly owned subsidiary of Old Mutual Asset Management (OMAM), the U.S. asset management group of Old Mutual PLC. OML is an international financial services company based in London with operations in asset management, banking, and general insurance." (See yesterday's News on Old Mutual's new Government and Treasury MMF filings.)
S&P continues, "Dwight Asset Management Co. LLC, an independently operated affiliate of OMAM, is the subadviser for the fund and is responsible for the day-to-day management of its investments. The firm, located in Burlington, Vermont, had approximately $69 billion in AUM as of Dec. 31, 2009. Dwight is exclusively focused on fixed-income investment solutions, including cash and liquidity management, stable value, insurance asset management, and total return strategies. Dwight's liquidity management team has a long history of managing 2a-7-registered money-market funds and short-duration investment portfolios, and the senior members of the team have worked together for more than 10 years."
Finally, S&P's TCW release says, "Standard & Poor's Ratings Services ... withdrew its 'AAAm' principal stability fund rating on TCW Money Market Fund at the request of the fund's investment advisor, TCW investment Management Co. The fund was within 'AAAm' rating criteria at the time of this rating withdrawal."
