A year ago, we wrote "Rolling w/Reform Changes III: Recap of '20 Prime Exits, News & Moves" (1/7/21), which explained, "In January 2016, money market mutual funds were in the midst of a series of dramatic changes ahead of October 2016's Money Fund Reforms, the biggest changes to money fund regulations since their introduction in October 1970. Five years ago, we ran the story, "Rolling w/Reform Changes II: Recap of '15 Announcements, '16 Plans," which reviewed a number of major changes among the largest managers that took place during 2015. As in the past year, exits from Prime MMFs and fund repositioning were notable trends." Today, we review the changes over the past year, as money funds prepare for yet another round of regulatory changes and fund lineup shifts in the New Year. (See also our "Dec. 10, 2021 News, "Top 10 Stories of 2021: More Regulations; Zero Yields; ESG; Changes. Note: Readers may also review "Crane Data's News," "Link of the Day" and "Money Fund Intelligence Archives" for more stories from the past year, 5 years and decade-plus.)

While we haven't seen as many lineup shifts and big exits from Prime as in 2015-6 or in 2020, we continued to see a steady stream of minor liquidations and lineup changes in 2021. In February, we wrote "SunAmerica Liquidating AIG Govt MMF; ICI, Weekly Portfolio Holdings" (2/18/21), and on March 5 we wrote, "March MFI: Liquidations, Changes; Ameriprise's Chris Melin; Deposits." Our March MFI's lead article said, "While the money market fund industry remains surprisingly robust given the myriad challenges it faces, small-scale liquidations and changes continue to gradually remake the space and increase concentration. Over the past month, a number of funds announced or completed liquidations, Wells Fargo announced the sale of its asset management unit, and Dreyfus took additional steps to streamline its fund lineup. In February, Crane Data removed 22 funds from MFI, including over a dozen State Municipal funds. Below, we review the latest batch of changes." (See our May 20, 2020 News, "Northern Liquidating Prime Obligs," and our June 22, 2020 News, "Fidelity to Liquidate Prime Instit Money Funds; Cites Investor Behavior.")

Later in the year, we wrote "Delaware Ivy Cash Funds Liquidating; Treasury Today on OMFIF Webinar" on 10/4/21), and we wrote "Nov. MFI: BMO Latest Exit; IMMFA's Iommi at EMFS; FSB's Final Report" on 11/5/21. The latter stated, "While there haven't been a ton, we continue to see mergers, liquidations and changes in the money fund space. The most recent involves the BMO Funds, which announced a deal to merge their money funds into Goldman Sachs' MMFs. Their SEC filing tells us, 'On Oct. 18, 2021, the Board of Directors of BMO Funds ... approved an agreement ... providing for the reorganization of each of the BMO Government Money Market Fund, BMO Prime MMF and BMO Tax-Free MMF ... into a corresponding series of Goldman Sachs Trust. BMO Asset Management Corp., investment adviser to each of the BMO Money Market Funds, recommended that the Board approve the Reorganizations in connection with its decision to exit the mutual fund investment advisory business in the United States, including ceasing management of each BMO Money Market Fund."

We also wrote about asset manager moves and changes in the updates, "BNY Mellon Streamlines Asset Management; Wells PMs on Rate Squeeze" ( 2/11/21) and "Wells Fargo Asset Mgmt. To Be Renamed Allspring Global Investments" (7/27/21). The latter quotes a press release, "GTCR LLC and Reverence Capital Partners, L.P. ... announced that upon closing of their acquisition of Wells Fargo Asset Management (WFAM), the newly independent company will be rebranded as Allspring Global Investments. The new name Allspring Global Investments reflects the newly independent firm's rich history in investment leadership and its commitment to renewal, growth, and meaningful client outcomes. As part of the transition, veteran industry executive Joseph A. Sullivan will become Chief Executive Officer, in addition to his previously announced role as Executive Chairman. Mr. Sullivan will succeed Nico Marais, WFAM's current CEO, who will retire upon closing of the transaction and continue to serve Allspring as a senior advisor."

In addition to the sporadic exits and shifts, we saw continued new fund launches in the ESG and Social space. Early in the year, we ran the piece, "JP Morgan Launches 'Empower' Share Class to Support Minority Banks" (2/24/21). Then in May, we published, "MS CastleOak D&I Share Classes Launch; SSGA's Goldthwait Talks ESG" (5/6/21). The former updated commented, "J.P. Morgan Asset Management unveiled another offering in the 'ESG and Social' money fund space, launching new 'Empower' share classes to support minority banks and institutions. A press release entitled, 'JPMorgan Chase Announces Initiatives to Support Minority-Owned and Diverse-Led Financial Institutions,' tells us, 'JPMorgan Chase today announced initiatives to further support Minority Depository Institutions (MDIs) and diverse-led Community Development Financial Institutions (CDFIs), as part of the firm's recently announced $30 billion commitment to advancing racial equity."

In the second half of the year, we posted more ESG stories: "BlackRock Expands ESG Lineup; Files for New Bancroft, Cabrera Shares" (8/19/21); "More D&I: State Street Files for Blaylock Van Shares; WSJ Hits Tether" (10/27/21); and, "SSGA Debuts Opportunity Class; BlackRock Bancroft, Cabrera Shares Live" (11/17/21). The latter News told us, "Money market fund managers continue to launch 'D&I' share classes, the latest trend in the ESG money fund space, according to a recent trio of announcements. The most recent moves comes from SSGA, which announced new 'Opportunity' share classes, and BlackRock, which went live with its new Bancroft and Cabrera classes."

Of course, waiting for new regulations was also a major theme and driver of change in 2021. On the European front (where we're still waiting for a proposal), we wrote: "ESMA Posts Consultation Report on Potential Reform of European MMFs" (3/30/21) and "IMMFA's Veronica Iommi Talks Regulations at European MF Symposium" (10/25/21). Our October update quoted IMMFA's Veronica Iommi, "`In Europe, our focus over the next few years will be the review of EU Money Market Fund regulation.... In anticipation, ESMA launched on the 26th of March, its consultation on potential reforms of the regulation. The aim of the consultation being to review the overall regime, including the roles played by markets and investors, take account of lessons learned following market stress experience during March last year. So, what are the current options on the table at the EU level and how do they marry with those contained in the FSB's final report and those being considered in other key jurisdictions? [S]everal of the potential reform options proposed by ESMA are similar to those of the U.S. President's Working Group Report issued in February and the FSB's recent final report."

Our Sept. 29, 2021 News, "Callahan, Cunningham Money Fund Symposium Keynote Talks ESG, Regs" discussed both pending regulatory changes and ESG. BlackRock's Callahan commented on regulatory changes, "I do believe that this time, once and for all, we're going to get it right. We're not only going to fix Prime funds, we're also going to fix the market infrastructure that surrounds [them]. But you know what I think the correct narrative for the current crisis for cash management industry is that we demonstrated once again that we were a source of stability to the global financial markets, not a source of instability. And for that, I think that all of you and all of us should feel very proud."

Finally, discussing the surprising news at the end of the year, our "SEC Proposes MMF Reforms: More Liquidity, No Gates/Fees, Swing Pricing" (12/16/21) explained, "The Securities & Exchange Commission proposed Money Market Fund Reforms Wednesday, which include higher liquidity levels, the removal of the emergency gates and fees regime, a new swing pricing mandate for Prime Inst MMFs and additional disclosure requirements." (See their "Fact Sheet" and the full Proposal here.)

The press release, "SEC Proposes Amendments to Money Market Fund Rules," tells us, "The Securities and Exchange Commission today voted to propose amendments to certain rules that govern money market funds under the Investment Company Act of 1940. In March 2020, growing economic concerns about the impact of the COVID-19 pandemic led investors to reallocate their assets into cash and short-term government securities. Prime and tax-exempt money market funds, particularly institutional funds, experienced large outflows, which contributed to stress on short-term funding markets. The Commission's proposed amendments are designed, in part, to address concerns about prime and tax-exempt money market funds highlighted by these events."

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