MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Thursday, February 9, 2012 Schwab and Federated Take a Money Fund Hit Reuters reports a five percent drop in Federated Investors Inc. shares Tuesday morning resulting from concerns toward the new rules the SEC plans to unleash towards the mutual fund business. Earlier this week, the Securities and Exchange Commission (SEC) was reportedly finalizing rules meant to stabilize the $2.7 trillion money-market mutual fund sector. Macquarie this morning downgraded Federated citing the impact from potential new regulations on money market funds, according to Yahoo! Finance. Federated managed $285.1 billion in money market funds at the end of December out of its $369.7 billion assets under management. Charles Schwab shares have also reportedly dropped during Tuesday morning trading. Sandler O'Neill analyst Richard Repetto reportedly projected that while Schwab would have $650 million in excess capital this year after accounting for its expected net income and other capital needs, he believes the company would still need to raise $219 million to support its money market funds. However, he added that a phase-in period between adoption of the plan and its effective date could "reduce the deficit." JMP Securities analyst David Trone echoed a different sentiment on Wednesday, saying that "between current excess cash and future retained earnings, Schwab can avoid such a raise." Printed from: MFWire.com/story.asp?s=39183 Copyright 2012, InvestmentWires, Inc. All Rights Reserved |