FEI Committee Submits Comments to Financial Stability Oversight Council on Proposed Money Market Fund Reform
MORRISTOWN, N.J. and WASHINGTON, Feb. 14, 2013 /PRNewswire/ -- Financial Executives International (FEI), the association of choice for CFOs and other senior-level finance executives, today announced that its Committee on Corporate Treasury has filed a comment letter with the Financial Stability Oversight Council (FSOC) on the "Proposed Recommendations Regarding Money Market Mutual Fund Reform."
FEI advocates the need to preserve the structure of money market mutual funds (MMF) and has concerns with the three proposed reform options, which would require funds either to float their value (Floating NAV), create a capital buffer with certain investor redemption delays (NAV Buffer and Minimum Balance at Risk), or implement a capital buffer combined with other measures (NAV Buffer and Other Measures). The comment letter states the committee's continued belief that the reform options are unnecessary and may have a dampening effect on the money market industry and then a collateral effect on corporate treasurers and their companies.
The committee believes that the U.S. Securities and Exchange Commission's (SEC) 2010 amendments to Rule 2a-7 have been adequate MMF reforms, and cautions regulators from implementing any changes that would significantly modify their structure or undermine their usefulness to U.S. businesses.
"Corporate treasurers, many of which play the role of chief liquidity officers for their companies, consider money market mutual funds to be a valuable investment and financing vehicle for cash management purposes," said Marie Hollein, CEO and president, Financial Executives International. "In the wake of the financial crisis, it is ever more critical that money market funds remain a strong tool for businesses and we are concerned about the impact these proposed reforms could have on both the money market industry and the economy as a whole. As one of the leadings organizations representing corporate treasurers, we appreciate the opportunity to comment on these proposed options by the FSOC, and look forward to working with regulators on a resolution that will benefit companies."
FEI's Committee on Corporate Treasury (CCT) formulates policy positions regarding treasury matters for FEI in line with the views of the membership and when appropriate, works to educate relevant policymakers and regulators on issues impacting corporate treasurers. The full comment letter can be found at can be viewed at http://www.financialexecutives.org/fly/CCT-Comments-to-FSOC
Financial Executives International is the leading advocate for the views of corporate financial management. Its 15,000 members hold policy-making positions as chief financial officers, treasurers and controllers at companies from every major industry. FEI enhances member professional development through peer networking, career management services, conferences, teleconferences and publications. Members participate in the activities of 86 chapters, 74 in the U.S., 11 in Canada and 1 in Japan. FEI is headquartered in Morristown, NJ, with additional offices in Washington, D.C. and Toronto. Visit www.financialexecutives.org for more information.
SOURCE Financial Executives International