On Wednesday, the Irish Funds Industry Association (IFIA), which represents mutual funds domiciled in Ireland for sale into Europe, held one of three "road shows" in Boston, where speakers and panelists discussed distribution, regulations and other "offshore" fund topics. Kevin Murphy, Chairman of the IFIA and Partner at Arthur Cox, commented about IFIA's "increasing profile in Brussels" and that "25% of Ireland's fund assets are in CNAV money funds." He said of the recently-stalled European money fund reform proposal, "We have fought tirelessly to get our message across. I'm delighted to say the vote in the [European Parliament's] ECON committee has been postponed." When [the proposal is] "revamped and reissued" [possibly in next year's session] he expected it "will include compromise positions significant for U.S. [managers, and] compromise that works." It is an "example of what we can do." Later, he added that he expected "mandatory gates & fees" to eventually be implemented instead of a "buffer". (Earlier this week, a committee again refused to take up money fund regulations, so the matter likely won't be addressed before new elections are held this spring. See our March 5 News "European Money Fund Regs Scuppered".)
Ted Hood, CEO of Source, added when asked about the regulations by our Peter Crane, "Investors [in Europe] are corporate treasurers. It's crazy that it's an issue [in Europe, since there are no retail investors]." BBH's Sean Tully commented, "The capital buffer will [likely] never see the light of day [in Europe]." But, he warned, "Bad ideas don't go away.... [It's] one less thing to worry about in the short-term."
This morning, U.K.-based publication Room 151 writes in "MMF reform dropped from ECON agenda", "The European Parliament has dropped proposals for the reform of money market firms which had raised fears for council investment strategies. A meeting of the parliament's economic and monetary affairs committee (ECON) had been due to vote on the reforms this week, but the matter was dropped from the agenda. The decision to abandon a vote follows a campaign by investment firms, local authorities and charities across Europe, concerned that the proposals would lead to the destruction of constant net asset value MMFs (CNAVs). The issue of MMF reform could return to the committee following the election of a new parliament in May, but the delay will mean that members will likely be able to take into consideration the verdict of US authorities, which is likely to arrive before June."
The piece adds, "Committee member Gay Mitchell, of the Irish Fine Gael Party, told Room151: "There has been very little effort to meet genuine concerns about CNAVs. They would not continue if MMF reform in its current format passed and the majority of MEPs feel this is too big a decision to rush and that CNAVs should continue, perhaps with some 'just in case' safeguards. Rushed legislation would be bad legislation and the attempt had been to have it on plenary agenda for April. The majority feel we should leave it to the new parliament to give it timely consideration." European elections are taking place in May, which are likely to change the membership of the ECON committee."
In other news, Crane Data published its most recent monthly Money Fund Intelligence Family & Global Rankings Monday, which ranks the asset totals and market share of managers of money funds in the U.S. and globally. (It's available to Money Fund Wisdom subscribers.) The latest reports show asset declines by almost all of major money fund complexes in February and in the latest quarter. BofA, Northern and Dreyfus were the only complexes among the 20 largest to show increases in February, rising by $1.6 billion, $1.0 billion, $23 million, respectively, while Morgan Stanley, Dreyfus, Goldman Sachs and Northern led the increases over the 3 months through Feb. 28, 2014, rising by $5.8B, $4.8B, $4.0B and $3.4B. Money fund assets overall declined by $45.8 billion in February, their first decline in 7 months, after rising by $568 million in January, $35.6 billion in December, $14.7 billion in November and $40.5 billion in October (according to our Money Fund Intelligence XLS).
Our latest domestic U.S. money fund Family Rankings show that Fidelity Investments remained the largest money fund manager with $420.1 billion, or 16.3% of all assets (down $1.7 billion in Feb., down $9.9B over 3 mos. and up $4.3B over 12 months), followed by JPMorgan's $249.4 billion, or 9.7% (down $5.0B, down $619M, and up $8.2B for 1-month, 3-months and 12-months, respectively). Federated Investors ranks third with $218.4 billion, or 8.5% of assets (down $9.5B, down $2.7B, and down $16.9B), BlackRock ranks fourth with $201.5 billion, or 7.8% of assets (down $489M, down $3.3B, and up $44.2B), and Vanguard ranks fifth with $174.0 billion, or 6.8% (down $695M, down $1.2B, and up $8.1B).
The sixth through tenth largest U.S. managers include: Dreyfus ($171.4B, or 6.7%), Schwab ($164.9B, 6.4%), Goldman Sachs ($136.3B, or 5.3%), Wells Fargo ($114.5B, or 4.4%), and Morgan Stanley ($100.3B, or 3.9%). The eleventh through twentieth largest U.S. money fund managers (in order) include: SSgA ($78.6B, or 3.1%), Northern ($76.7B, or 3.0%), Invesco ($62.0B, or 2.4%), BofA ($50.2B, or 2.0%), UBS ($42.3B, or 1.6%), Western Asset ($39.6B, or 1.5%), First American ($37.5B, or 1.5%), DB Advisors ($34.8B, or 1.4%), RBC ($20.0B, or 0.8%), and Franklin ($18.6B, or 0.7%). Crane Data currently tracks 75 managers, the same number as last month.
Over the past year, Dreyfus showed the largest asset increase (up $18.9B, or 12.1%), followed by SSgA (up $13.6B, or 18.3%) and Morgan Stanley (up $10.9B, or 12.0%). Other big gainers since Feb. 28, 2013, include: JPMorgan (up $8.2B, or 3.3%), Vanguard (up $8.1B, or 4.9%), Schwab (up $6.0B, or 3.8%), Fidelity (up $4.3B, or 1.0%) and Reich & Tang (up $4.0B, or 52.0%). The biggest declines over 12 months include: `Federated (down $16.9B, or 7.1%), UBS (down $10.7B, or 19.2%) and DB Advisors (down $9.6B, or 20.6%). (Note that money fund assets are very volatile month to month.)
When "offshore" money fund assets -- those domiciled in places like Dublin, Luxembourg, and the Cayman Island -- are included, the top 10 managers match the U.S. list, except for BlackRock moving up to No. 3, Goldman moving up to No. 5, and Western Asset appearing on the list at No. 9. (displacing Wells Fargo from the Top 10). Looking at these largest Global Money Fund Manager Rankings, the combined market share assets of our MFI XLS (domestic U.S.) and our MFI International ("offshore), we show these families: Fidelity ($424.9 billion), JPMorgan ($379.0 billion), BlackRock ($302.7 billion), Federated ($227.9 billion), and Goldman ($203.8 billion). Dreyfus ($199.1B), Vanguard ($174.0B), Schwab ($164.9B), Western ($137.1B), and Morgan Stanley ($115.6B) round out the top 10. These totals include offshore US dollar funds, as well as Euro and Sterling funds converted into US dollar totals.
In other news, our March 2014 MFI and MFI XLS show net yields remained at record lows and gross yields inched higher in the month ended Feb. 28, 2014. Our Crane Money Fund Average, which includes all taxable funds covered by Crane Data (currently 841), remained at a record low of 0.01% for both the 7-Day and 30-Day Yield (annualized, net) averages. (The Gross 7-Day Yield inched lower to 0.13%.) Our Crane 100 Money Fund Index shows an average yield (7-Day and 30-Day) of 0.02%, also a record low, and down from 0.05% at the start of 2013. (The Gross 7- and 30-Day Yields for the Crane 100 remained at 0.16%.) For the 12 month return through 2/28/14, our Crane MF Average returned a record low of 0.02% and our Crane 100 returned 0.03%.
Our Prime Institutional MF Index yielded 0.02% (7-day), the Crane Govt Inst Index yielded 0.01%, and the Crane Treasury Inst, Treasury Retail, Govt Retail and Prime Retail Indexes all yielded 0.01%. The Crane Tax Exempt MF Index also yielded 0.01%. (The Gross Yields for these indexes were: Prime 0.19%, Govt 0.10%, Treasury 0.06%, and Tax Exempt 0.13% in Feb.) The Crane 100 MF Index returned on average 0.00% for 1-month, 0.00% for 3-month, 0.00% for YTD, 0.03% for 1-year, 0.04% for 3-years (annualized), 0.08% for 5-year, and 1.65% for 10-years.
