Board of Governors on Wednesday endorsed recommendations put together by the money market working group (click
to view the full
report) aimed at making money funds more transparent and liquid. Shefali Anand picked up on
those recommendations, which include requiring money funds to hold a cash balance of 5 percent
to 20 percent, in Wednesday's
Wall Street Journal Fund Track column
Vanguard chairman Jack Brennan
chairs the working group, whose members include
ICI president and CEO Paul Schott Stevens
, Legg Mason chairman and CEO Mark Fetting
, Fidelity asset management head Michael Wilens
, JPMorgan Funds president and CEO George Gatch
, Goldman Sachs Mutual Funds president and CEO James McNamara
, Invesco president and CEO Martin Flanagan
, Schwab Funds president Randall Merk
, Federated Investors vice chairman John McGonigle
, BlackRock managing director Richard Davis
and BlackRock Funds independent director James Bodurtha
The group recommends that all money funds be required
to publish investments monthly, and that the funds reveal the type of clients they have.
Another recommendation is for the SEC to authorize funds to be able to suspend
redemptions and purchases of shares for up to five days.
In addition, there's a proposal to decrease the average weighted maturity of money funds'
investments from 90 days to 75 days. Such a move "provides a more liquid portfolio," Fetting told The Journal.
In a separate interview with
, Fetting said industry executives hoped
the proposals would pre-empt regulations backed by former Federal Reserve chairman Paul Volcker
who heads up President Obama's Economic Recovery Advisory Board.
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