The London-based Institutional Money Market Funds Association published "IMMFA Position on the Money Market Fund Regulation," an Executive Summary of the lobbying group's "grab bag" of thoughts on pending money market fund reforms in Europe. It says, "This paper summarizes the key issues for IMMFA members in the MMFR. It draws on both the Commission and European Parliament texts. IMMFA supports the introduction by the Parliament of new types of fund, but further work is needed to make these funds viable." We discuss the latest on European money fund reforms, assets and yields below, and also review our latest MFI International Money Fund Portfolio Holdings summary. Finally, the website is now live for Crane's 4th Annual European Money Fund Symposium, which will be held Sept 20-21, 2016 in London.

The IMMFA release examines the reform proposal from a variety of angles. On "Product Design," it says: "Low Volatility NAV (Articles 2(12b), 27): requires further key amendments to ensure the product has longevity and stability, and therefore can offer an attractive investment option for clients (sunset clause and 20bp "collar" need reworking). Public Debt CNAV (Article 2(22a)): limited scope of eligible investments questioned; currently 95% of CNAV government funds are US$. Retail CNAV (Article 2(12a)): narrow investor base is less stable; funds would be better widened to allow investment by pension funds and natural persons."

On "Structural Reforms," IMMFA says, "Capital buffers (Articles 29-30): introduction of capital buffers would make existing CNAV funds non-viable and pose substantial barrier to entry for new funds. Sponsor support (Article 35): we support restrictions on sponsor support, and suggest that these should be recognised explicitly in Basel III related capital provisions that assume support may be provided to MMF."

On "MMF Investments," the summary explains, "IMMFA agrees that risk controls for Short Term MMFs should promote the use of high quality assets. It is important that this does not unnecessarily restrict the ability of MMF to invest.... Eligible assets (Article 8): investment in other MMF should be included. Whilst reverse repo is an appropriate asset for MMF, repo (added by the EP Article 8.1(d)) is not.... Eligible securitisation (Article 10): the limits set on securitisation holdings are overly tight and will impede funding to business, SMEs. The ESMA guidelines deal with this already. Diversification (Articles 14, 15): To avoid impacting business funding, the diversification and concentration rules should be grouped and limits set in line with existing UCITS rules. Liquidity (Article 21): Equal treatment should be applied to all MMF."

For more on the status of pending, stalemated European money fund reforms, see our "Dec. 2 News, "FT Says Lux Blocking European MF Reforms; MFI Intl Update, Holdings," which quotes a Financial Times article, "Luxembourg 'blocking' money market reform." It says, "A spokesman for the Dutch EU Presidency, which took over in January, said the MMF file is not among its priorities." (See also our Sept. 23 News, "European Money Fund Symposium: Kooy, Lardner Push Viable Solutions.")

European money fund assets domiciled in Dublin and Luxembourg and denominated in USD, Euro and Sterling are up $1.5 billion to $677.0 billion in the latest month (through 2/29) and down $22.1 billion year-to-date, according to our Money Fund Intelligence International. U.S. Dollar (USD) funds (157) tracked by MFII account for over half ($368.6 billion, or 54.5%) of the total, while Euro (EUR) money funds (98) total just E77.2 billion and Pound Sterling (GBP) funds (110) total L150.3. USD funds were down $3.5 billion in February and $23.5 billion, or 5.9%, YTD through 2/29. Euro funds are up E3.5 billion for the month and up E1.8 billion YTD, while GBP funds are up L700 million in February and down L200 million YTD. USD MMFs yield 0.26% (7-Day) on average (2/29/16), up from 0.23% on 1/31 and up from 0.16% on 12/31/15. EUR MMFs yield -0.20% on average, unchanged from the previous month, while GBP MMFs yield 0.40%.

European USD MMFs, on average, consist of 24.0% in Certificates of Deposit (CDs), 23.0% in Commercial Paper (CP), 24.0% in Treasury securities, 11.0% in Other securities (primarily Time Deposits), 12.0% in Repurchase Agreements (Repo), 4.0% in Government Agency securities, and 2.0% in VRDNs (Variable-Rate Demand Notes). USD funds have on average 28.0% of their portfolios maturing Overnight, 8.7% maturing in 2-7 Days, 20.1% maturing in 8-30 Days, 11.8% maturing in 31-60 Days, 14.4% maturing in 61-90 Days, 12.4% maturing in 91-180 Days, and 4.5% maturing beyond 181 Days. USD holdings are affiliated with the following countries: US (37.2%), France (15.0%), Japan (9.4%), Canada (8.0%), Sweden (6.2%), Great Britain (3.4%), Australia (4.0%), Germany (3.7%), Netherlands (4.0%), and Singapore (2.2%), according to our latest MFII MF Portfolio Holdings report, with data as of Jan. 31, 2016.

The 20 Largest Issuers to "offshore" USD money funds include: the US Treasury with $101.5 billion (24.1% of total portfolio assets), Credit Agricole with $15.3B (3.6%), BNP Paribas with $14.2B (3.4%), Bank of Tokyo-Mitsubishi UFJ Ltd with $11.3B (2.7%), Wells Fargo with $11.1B (2.6%), Societe Generale with $10.8B (2.6%), Sumitomo Mitsui Banking Co with $9.4B (2.2%), Bank of Nova Scotia with $9.4B (2.2%), Natixis with $8.5B (2.0%), Federal Reserve Bank of New York with $8.4B (2.0%), Svenska Handelsbanken with $8.2B (1.9%), RBC with $7.4B (1.8%), Credit Mutuel $7.3B (1.7%), Rabobank with $7.3B (1.7%), DnB NOR Bank ASA with $7.0B (1.7%), Nordea Bank with $6.8B (1.6%), JP Morgan with $6.6B (1.6%), Mizuho Corporate Bank Ltd with $6.1B (1.4%), ING Bank with $6.0B (1.4%), and Bank of America with $5.9B (1.4%).

Euro MMFs tracked by Crane Data contain, on average 20.0% in CDs, 45.0% in CP, 17.0% in Other (primarily Time Deposits), 11.0% in Repo, 2.0% in Agency securities, and 5.0% in Treasury securities. EUR funds have on average 20.5% of their portfolios maturing Overnight, 8.1% maturing in 2-7 Days, 21.8% maturing in 8-30 Days, 14.0% maturing in 31-60 Days, 15.0% maturing in 61-90 Days, 17.1% maturing in 91-180 Days, and 3.6% maturing beyond 181 Days. EUR MMF holdings are affiliated with the following countries: France (31.3%), US (16.9%), Japan (10.7%), Sweden (6.7%), Great Britain (5.9%), Germany (8.1%), Netherlands (6.3%), Belgium (4.3%), Switzerland (1.4%), and Canada (1.3%) <b:>`_.

The 15 Largest Issuers to "offshore" EUR money funds include: Republic of France with E4.4B (6.2%), BNP Paribas with E3.9B (5.4%), Proctor & Gamble with E3.0B (4.2%), General Electric with E3.0B (4.1%), Svenska Handelsbanken with E2.9B (4.1%), Rabobank with E2.8B (3.9%), Societe Generale with E3.6B (2.6%), Credit Agricole with E2.3B (3.3%), HSBC with E2.0B (2.8%), Sumitomo Matsui Banking Co. with E2.0B (2.8%), Nordea Bank with E1.7B (2.4%), Dexia Group with E1.6B (2.2%), Bank of Tokyo-Mitsubishi UFJ Ltd with E1.6B (2.2%), Credit Suisse with E1.6B (2.2%), BRED Banque Populaire SA with E1.6B (2.2%), and Mizuho Corporate Bank with E1.6B (2.2%).

The GBP funds tracked by MFI International contain, on average (as of 1/31/16): 26.0% in CP, 27.0% in Other (Time Deposits), 32.0% in CDs, 8.0% in Repo, 5.0% in Treasury, 1.0% in Agency, and 1.0% in VRDNs. Sterling funds have on average 20.7% of their portfolios maturing Overnight, 4.0% maturing in 2-7 Days, 19.6% maturing in 8-30 Days, 17.9% maturing in 31-60 Days, 17.2% maturing in 61-90 Days, 15.1% maturing in 91-180 Days, and 5.4% maturing beyond 181 Days. GBP MMF holdings are affiliated with the following countries: France (15.1%), Great Britain (14.7%), Japan (11.2%), Germany (9.3%), Australia (8.9%), US (6.5%), Netherlands (7.3%), Canada (6.5%), Sweden (5.5%), and Singapore (3.2%).

The 15 Largest Issuers to "offshore" GBP money funds include: UK Treasury with L8.0B (6.0%), Rabobank with L4.6B (3.5%), Sumitomo Mitsui Banking Co with L4.2B (3.1%), BNP Paribas with L4.2B (3.1%), Bank of Tokyo-Mitsubishi UFJ Ltd with L4.1B (3.1%), Nordea Bank with L4.0B (3.0%), Bank of America with L3.7B (2.8%) <b:>`_, Toronto Dominion Bank with L3.5B (2.7%), National Australia Bank Ltd with L3.5B (2.6%), Erste Abwicklungsanstalt with L3.4B (2.6%), Credit Mutuel with L3.2B (2.4%), HSBC with L3.1B (2.3%), Standard Chartered Bank with L3.0B (2.2%), and Mizuho Corporate Bank Ltd with L2.9B (2.2%). (E-mail us at to request a copy of our latest MFI International or MFII Portfolio Holdings.)

Finally, the conference website ( is now live for our 4th Annual Crane's European Money Fund Symposium, which will be held Sept. 20-21 at the London Tower Bridge Hilton. Last year's "European" conference in Dublin attracted a record 120 attendees, making it the largest money fund event outside of the U.S. (The largest in the U.S. of course is our Money Fund Symposium, which will be held June 22-24 in Philadelphia.) The European Symposium's Preliminary Agenda is also out, but it remains a work in progress for now. (So let us know if you'd like to speak or sponsor.)

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