MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
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Tuesday, July 3, 2012 Northern Trust's Support is a Flashpoint for Money Market Debate Northern Trust [profile] has stepped in to support a Norwegian lender whose debt rating has been downgraded, perhaps a key moment in the heated debate over the future of money market funds. Reuters reports that the Chicago trust put aside $69.7 million to support Norwegian lender Eksporfinans, which was downgraded by Moody's. The Chicago bank said it did not suffer losses upon buying the notes but others claim that the fund sponsor still faced extra cost and risk on the move. Kenneth French, director of strategy at Dimensional Fund Advisors and a Dartmouth College finance professor, told Reuters: "If Northern at the time of the transaction thought they were not subsidizing the funds, (then) I have a lot of bonds I would like to sell (to) them." A statement from Northern Trust said that the sale of Eksporfinans notes was an effect of Moody's plans to downgrade funds that held the notes. A February 3 SEC filing revealed that Diversified Assets Portfolio and Prime Obligations Portfolio held the notes, but later sold them to their parent Nothern Trust for $50.3 million and $19.4 million, respectively. Printed from: MFWire.com/story.asp?s=40507 Copyright 2012, InvestmentWires, Inc. All Rights Reserved |