The Chamber of Commerce's Center for Capital Markets Competitiveness sent a letter to SEC last week on a floating NAV. It says, "We understand that the Securities and Exchange Commission ("SEC") is working toward a proposal that seeks to enhance the safety and soundness of MMMFs and may be considering concepts included in the Financial Stability Oversight Council's ("FSOC") proposed recommendations for MMMF reform. One of FSOC's proposed alternatives is the adoption of floating net asset values ("NAVs") along with the elimination of amortized cost accounting that facilitates a stable net asset value. Corporate treasurers and other investors, however, continue to express concerns regarding a floating net asset value because it eliminates a primary benefit of money market mutual fund investments while introducing a myriad of complex and costly accounting, tax, and operational obstacles. While we continue to believe that a floating NAV is not the right way to prevent perceived run risks, a floating NAV rule that does not fully address the accounting, tax, and operational changes needed to make it work would simply make the product unusable. Any regulatory action by the SEC incorporating a floating NAV into Rule 2a-7 should be done in concert with other standard-setting, regulatory, and legislative bodies whose actions may be necessary to ensure the continued utility and viability of MMMFs. The SEC by itself cannot make a floating NAV work without rendering the utility of MMMFs useless. It is therefore incumbent on the SEC to work jointly with other bodies to ensure all issues are addressed before any rule change is adopted."

Email This Article




Use a comma or a semicolon to separate

captcha image

Daily Link Archive

2024 2023 2022
March December December
February November November
January October October
September September
August August
July July
June June
May May
April April
March March
February February
January January
2021 2020 2019
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2018 2017 2016
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2015 2014 2013
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2012 2011 2010
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2009 2008 2007
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2006
December
November
October
September