Treasury Today writes "European MMF reform: change is on the horizon?" It says, "After much delay, European lawmakers have announced a breakthrough agreement regarding European money market reforms. The European Parliament have announced that there has been a breakthrough agreement between MEPs and the Slovak Presidency of the Council of the EU around the controversial topic of European money market reform. The agreement comes following lengthy and rancorous deliberation, more than three years since the European Commission published the original proposal." The article adds, "The headline news, as many expected, is that Low Volatility NAV (LVNAV) funds will be introduced in Europe. Sitting somewhere between CNAV Government funds priced to two decimal places and VNAV funds that use mark-to-market or mark-to-model pricing to four decimal places, LVNAV funds seek to provide many of the key attributes that compel corporates to use CNAV MMFs but with the extra safety sought from the EU lawmakers.... Will this have an impact on how asset managers operate these funds? According to Beccy Milchem, Head of Corporate Sales at Blackrock, it will, but not substantially." "We anticipate that we would likely run the LVNAV portfolios more conservatively than we run our Prime CNAV funds today, but we do not believe that we will need to change our investment or credit process," she tells Treasury Today. The piece adds, "It is important to note that despite this most recent announcement, the final text is yet to be completely finalised -- although what this text will contain is becoming clearer. And even once finalised change will not happen immediately. A transition period of around two years will be initiated with the regulations most likely coming into effect in late 2018 or early 2019."

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