ATLANTA, Nov. 9, 2015 /PRNewswire/ -- Invesco today announced changes to its money market fund lineup to address the regulatory changes adopted by the U.S. Securities and Exchange Commission (SEC) in July 2014.
In July of 2014, the SEC announced new money market fund reforms. These reforms, intended to further strengthen the resiliency of funds during times of stress, will take effect October 14, 2016 and influence the shape of the money market fund industry for years to come.
In order to assist our investors in planning, and to help ease the transition into the new regulatory environment, details of our intentions for certain segments of our money market fund product line follow. Accordingly, we have reviewed these intentions with the funds' Board of Trustees.
Government Money Market Funds:
Under the new rules, government money market funds will be permitted to transact at a stable, or constant, net asset value (CNAV) of $1.00 per share and must invest at least 99.5% of their assets in cash, U.S. Government Securities (as defined under the federal securities laws), and/or repurchase agreements collateralized by cash or U.S. Government Securities.
The following Invesco money market funds will operate consistent with the government money market fund classification:
- Government & Agency Portfolio
- Government TaxAdvantage Portfolio
- Invesco V.I. Money Market Fund
- Premier U.S. Government Money Portfolio
- Treasury Portfolio
The Invesco V.I. Money Market Fund, currently a prime money market fund, will change its name and investment strategy to qualify and operate as a government money market fund effective on or about April 29, 2016. A prospectus supplement describing these changes in detail was filed on Nov. 3, 2015.
Government & Agency Portfolio, Premier U.S. Government Money Portfolio, Government TaxAdvantage Portfolio, and Treasury Portfolio have historically invested 100% of their assets in cash, U.S. Government Securities, and/or repurchase agreements collateralized by cash or U.S. Government Securities. Therefore, these funds are currently in compliance with the investment requirement of the new regulations and intend to remain in compliance in advance of reform implementation. Furthermore, Invesco does not have a current intention of adopting liquidity fees or redemption gates for these funds. The Board reserves the right to impose a liquidity fee or redemption gate in the future upon prior notice to shareholders.
Constant NAV (CNAV) Retail Money Market Funds: Under the new rules, prime and municipal money market funds available only to retail investors will be permitted to continue to transact at a constant, or stable, net asset value (CNAV) of $1.00 per share. These funds will be subject to liquidity fees and redemption gates on or before October 14, 2016 when reform is fully implemented.
The following two Invesco money market funds will operate consistent with the CNAV retail money market fund classification:
- Invesco Tax-Exempt Cash Fund
- Tax-Free Cash Reserve Portfolio
Floating NAV (FNAV) Money Market Funds: Prime and municipal institutional money market funds that are available to only institutional investors, or both institutional investors and retail investors, must transact at floating net asset value (FNAV) by October 14, 2016. FNAV money market funds will also be subject to liquidity fees and redemption gates.
The following Invesco money market funds will operate consistent with the FNAV money market fund classification:
- Liquid Assets Portfolio
- Premier Tax-Exempt Portfolio
- STIC Prime Portfolio
The specific timing of the changes discussed above will be determined and communicated in 2016 as final reform implementation takes shape. Additionally, we will communicate plans for the Invesco Money Market Fund and the Premier Portfolio in the future.
Invesco Global Liquidity: Long-Term Approach to Short-Term Investing
For more than 30 years, Invesco Global Liquidity has worked to gain and keep the trust of our investors through our deep industry knowledge and our investment expertise.
Our primary goal through the money market fund reform process is to provide our investors with a full suite of liquidity management solutions to meet their investing needs with the least amount of disruption while remaining focused on our disciplined investment process.
About Invesco Ltd.
Invesco Ltd. is a leading independent global investment management firm, dedicated to helping investors worldwide achieve their financial objectives. By delivering the combined power of our distinctive investment management capabilities, Invesco provides a wide range of investment strategies and vehicles to our clients around the world. Operating in more than 20 countries, the firm is listed on the New York Stock Exchange under the symbol IVZ. Additional information is available at www.invesco.com.
Before investing, investors should carefully read the prospectus and/or summary prospectus and carefully consider the investment objectives, risks, charges and expenses. For this and more complete information about the fund(s), investors should ask their advisers for a prospectus/summary prospectus or visit invesco.com/fundprospectus.
Invesco Distributors, Inc. is the US distributor for Invesco Ltd.'s retail products. It is an indirect, wholly owned subsidiary of Invesco Ltd.
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