The Investment Company Institute (“ICI”) submitted comments regarding the SEC-proposed amendments to the rules and related requirements that govern money market funds (“MMFs”), most notably Investment Company Act Rule 2a-7 (“Money Market Funds”). The ICI commented on number of topics within the SEC MMF proposals, generally including:
- agreeing with the SEC that structural reforms to government and tax-exempt MMFs should not be applied;
- recommending that the SEC expand the circumstances under which a board may impose a liquidity fee or temporarily suspend redemptions to cover situations in which heavy redemptions are already underway or foreseeable;
- disagreeing with the proposal to require prime and tax-exempt institutional MMFs to let net asset value (“NAV”) float;
- disagreeing with the proposal to combine floating NAV and liquidity fee/temporary gate proposals;
- disagreeing with the proposal to eliminate the amortized cost method of valuing securities for all funds;
- agreeing with the proposal to enhance public disclosure and the reporting of MMF portfolio information and risks, unless the SEC requires MMF NAVs to float;
- making multiple suggestions regarding more stringent diversification requirements;
- disagreeing with the proposal to revise current stress-testing requirements; and
- making suggestions on the proposed amendments to Form PF reporting requirements.
See: ICI Comment Letter.
See also: Committee on Financial Services to Examine SEC’s Money Market Fund Rule Proposal (September 17, 2013); SEC Proposes in the Federal Register Money Market Fund Reform and Amendments to Form PF; Comments Due September 17th (June 20, 2013); SEC Proposes Money Market Fund Reforms (June 7, 2013); SEC Open Meeting: Money Market Fund Reform (with link to Delta Strategy Description of SEC Meeting) (June 6, 2013).