At least three large mutual fund firms want NAV buffers for some or all money market funds. Crane Data reports
that yesterday Fidelity
] and Wells Fargo
] submitted a joint comment letter on the "President's Working Group Report on Money Market Fund Reform," pointing to the NAV buffer as their new money fund regulation of choice, ahead of ideas like floating NAVs or capital requirements.
Crane notes that the letter (penned by Fido's Scott Goebel
, Schwab's Carrie Dwyer
and Wells' David Messman
) arrived in advance of the SEC
's money market fund roundtable scheduled for Tuesday.
"We think that an NAV buffer is the leading concept to provide enhanced resiliency and shareholder protections for money market mutual funds," the trio wrote. "We believe that many of the proposals in the PWG Report, such as floating the NAV or imposing bank-like capital requirements, could have damaging effects on money market mutual funds and the short-term markets."
"The NAV buffer addresses both liquidity and capital," they added. "Thus, no additional liquidity facility or onerous capital requirements are needed."
Neil Anderson, Managing Editor
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