The Investment Company Institute released its latest "Money Market Fund Assets" report, as well as its monthly "Trends in Mutual Fund Investing" and "Month-End Portfolio Holdings of Taxable Money Funds" for February 2023 on Thursday. Both asset series show money fund totals hitting record levels, with the new weekly statistics putting ICI's MMF totals at just under $5.2 trillion, after breaking the $5.1 trillion barrier for the first time ever the week prior. The previous 2 weeks were the 5th and 6th largest weekly increases ever and the largest in history if you exclude 4 coronavirus lockdown panic weeks in March and April 2020. The failure of Silicon Valley Bank has raised concerns over uninsured bank deposits, and large investors are fleeing into money funds. Over the past 52 weeks, money fund assets have risen $608 billion, or 13.2%, with Retail MMFs rising by $436 billion (30.4%) and Inst MMFs rising by $171 billion (5.4%). ICI shows assets up by $463 billion, or 9.8%, year-to-date in 2023, with Institutional MMFs up $267 billion, or 8.7% and Retail MMFs up $196 billion, or 11.7%. (According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets hit a record on Wednesday but declined by $14.0 billion on Thursday. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.)
The weekly release says, "Total money market fund assets increased by $65.99 billion to $5.20 trillion for the week ended Wednesday, March 29, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $71.08 billion and prime funds decreased by $8.08 billion. Tax-exempt money market funds increased by $2.99 billion." ICI's stats show Institutional MMFs surging $54.5 billion and Retail MMFs rising $11.5 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.331 trillion (83.3% of all money funds), while Total Prime MMFs were $757.3 billion (14.6%). Tax Exempt MMFs totaled $109.9 billion (2.1%).
ICI explains, "Assets of retail money market funds increased by $11.50 billion to $1.87 trillion. Among retail funds, government money market fund assets increased by $11.17 billion to $1.27 trillion, prime money market fund assets decreased by $2.66 billion to $503.90 billion, and tax-exempt fund assets increased by $2.99 billion to $99.40 billion." Retail assets account for over a third of total assets, or 36.0%, and Government Retail assets make up 67.8% of all Retail MMFs.
They add, "Assets of institutional money market funds increased by $54.49 billion to $3.32 trillion. Among institutional funds, government money market fund assets increased by $59.92 billion to $3.06 trillion, prime money market fund assets decreased by $5.43 billion to $253.35 billion, and tax-exempt fund assets were unchanged at $10.54 billion." Institutional assets accounted for 64.0% of all MMF assets, with Government Institutional assets making up 92.1% of all Institutional MMF totals.
ICI's monthly "Trends" report shows that money fund assets increased $60.0 billion in February to a record $4.867 trillion. Meanwhile, bond fund assets decreased, falling $70.5 billion to $4.567 trillion. Money fund assets, which surpassed bond fund assets in September 2022 for the first time since 2010, saw their lead over bond funds grow last month. MMFs have increased by $286.8 billion over the past 12 months. (The bond fund totals don't include bond ETFs, which total $1.293 trillion as of 2/28, according to ICI.)
Money funds' February asset increase follows gains of $31.5 billion in January, $105.3 billion in December, $63.4 billion in November, $36.8 billion in October and $4.2 billion in Sept. MMFs decreased $6.4 billion in August, but they increased $34.3 billion in July and $25.0 billion in June. MMFs decreased $8.0 billion in May and $71.0 billion in April. They increased $9.6 billion in March, but decreased $38.3 billion last February. For the 12 months through Feb. 28, 2023, money fund assets increased by $286.8 billion, or 6.3%. (For the month of March through 3/29, MMF assets have increased by $325.6 billion to $5.578 trillion according to MFI Daily. Crane Data's Prime asset totals have decreased by $31.2 billion in March to $1.125 trillion.)
ICI's monthly release states, "The combined assets of the nation's mutual funds decreased by $403.05 billion, or 1.7 percent, to $22.74 trillion in February, according to the Investment Company Institute's official survey of the mutual fund industry. In the survey, mutual fund companies report actual assets, sales, and redemptions to ICI.... Bond funds had an inflow of $18.07 billion in February, compared with an inflow of $17.59 billion in January.... Money market funds had an inflow of $50.48 billion in February, compared with an inflow of $22.25 billion in January. In February funds offered primarily to institutions had an inflow of $4.52 billion and funds offered primarily to individuals had an inflow of $45.96 billion."
The Institute's latest statistics show that both Taxable and Tax Exempt MMFs were higher last month. Taxable MMFs increased by $59.1 billion in February to $4.754 trillion. Tax-Exempt MMFs increased $1.0 billion to $113.5 billion. Taxable MMF assets increased year-over-year by $258.3 billion (5.7%), and Tax-Exempt funds rose by $28.6 billion over the past year (33.7%). Bond fund assets decreased by $70.5 billion (after increasing $146.2 billion in Jan.) to $4.567 trillion; they've decreased by $847.6 billion (-15.7%) over the past year.
Money funds represent 21.4% of all mutual fund assets (up 0.6% from the previous month), while bond funds account for 20.1%, according to ICI. The total number of money market funds was 281, unchanged from the prior month and down from 302 a year ago. Taxable money funds numbered 232 funds, and tax-exempt money funds numbered 49 funds.
ICI's "Month-End Portfolio Holdings" confirm a jump in Repo and plunge in Treasuries last month. Repurchase Agreements remained the largest composition segment in February, increasing $95.0 billion, or 3.6%, to $2.748 trillion, or 57.8% of holdings. Repo holdings have increased $609.8 billion, or 28.5%, over the past year. (See our March 10 News, "March MF Portfolio Holdings: Repo Jumps; Treasuries, Agencies Fall.")
Treasury holdings in Taxable money funds fell again, but they remained the second largest composition segment. Treasury holdings dropped $38.8 billion, or -3.9%, to $952.4 billion, or 20.0% of holdings. Treasury securities have decreased by $741.6 billion, or -43.8%, over the past 12 months. U.S. Government Agency securities were the third largest segment; they decreased $21.4 billion, or -3.8%, to $538.6 billion, or 11.3% of holdings. Agency holdings have increased by $162.2 billion, or 43.1%, over the past 12 months.
Certificates of Deposit (CDs) remained in fourth place; they increased by $10.0 billion, or 4.1%, to $254.0 billion (5.3% of assets). CDs held by money funds rose by $65.7 billion, or 34.9%, over 12 months. Commercial Paper remained in fifth place, down $3.1 billion, or -1.5%, to $198.9 billion (4.2% of assets). CP increased $51.6 billion, or 35.1%, over one year. Other holdings increased to $15.7 billion (0.3% of assets), while Notes (including Corporate and Bank) dipped down to $4.5 billion (0.1% of assets).
The Number of Accounts Outstanding in ICI's series for taxable money funds increased to 59.913 million, while the Number of Funds was unchanged at 232. Over the past 12 months, the number of accounts rose by 11.377 million and the number of funds decreased by 11. The Average Maturity of Portfolios was a record low 14 days, unchanged from January. Over the past 12 months, WAMs of Taxable money have decreased by 14.
