Nnsec money market reform pdf

Money market fund reform sec open meeting july 23, 2014. An evaluation of money market fund reform proposals. Among the final reforms was a requirement that institutional prime and municipal. Money market funds mmfs provide shortterm finance to financial institutions, corporations and governments. Establishes 3 categories of money market fundsretail, government, and institutional. After years of contested debates about the pros and cons of regulation for european money market funds mmfs and. Vi considers alternative reform proposals, and section vii offers some concluding remarks. In an effort to address concerns expressed by regulators that money market funds may contribute to financial instability, the securities and exchange commission recently adopted rules intended to change money market funds held by institutional inven96i keywords. Money market funds, sometimes called money funds, are a type of mutual fund developed in the 1970s as an option for investors to purchase a pool of securities that generally provided higher returns than interestbearing bank accounts. The staff of the division of investment management has prepared the following responses to questions related to the money market fund reforms adopted in july 2014 and expects to update this document from time to time to include responses to additional questions. The securities and exchange commission commission or sec is adopting amendments to certain rules that govern money market funds under the investment company act of 1940.

In the past three years, european money market funds mmfs have grown by an impressive eur 260 bn to eur 1. The european securities and markets authority esma, the eus. Money market reform is a set of sec rule amendments meant to address any potential financial instability that could be caused by money market funds. Background on money market funds a money market fund is a type of mutual fund that is required by law to invest in shortterm, lowrisk securities. Six years later in 2014, the securities and exchange commission sec. In 2014, reforms for us money market funds mmfs were adopted to address problems that surfaced during the 2008 financial crisis 2008 crisis. Mmfs convert to floating net asset value fnav funds from.