"Moody's: SIFI designation still unclear for asset managers and money funds" says a press release sent out by the ratings agency yesterday. It explains, "Asset managers or money market funds that are designated as systemically important financial institutions, or "SIFIs" may be subject to new requirements regarding capital and operations, as well as heightened supervision, says Moody's Investors Service in its new report. On April 3, 2012, the Financial Stability Oversight Council (FSOC) issued a final rule and interpretive guidance under the Dodd-Frank Act outlining the process for designating systemically important non-bank financial institutions. But quantitative thresholds are still evolving and the regulations are still preliminary." Report author Dagmar Silva comments, "We expect that designated asset managers or funds would see some form of regulation affecting the capital requirement, governance and operations, which would bolster their creditworthiness, but could put them at a competitive disadvantage to peers." The release adds, "Some of the largest asset managers and money market funds (MMFs) are likely to be designated SIFIs, but which ones remain unclear, says Moody's. It is also not clear what would be the final requirements imposed on designated asset managers or MMFs. The report is entitled, "Systemically Significant Financial Institution (SIFI) Designation Still Unclear for Asset Managers and Money Markey Funds".
