CHERRY HILL, NJ, March 31, 2016 /PRNewswire/ - TD Asset Management (TDAM) today announced plans to adjust its money fund lineup to address regulatory changes adopted by the U.S. Securities and Exchange Commission (SEC) in July 2014. The adjustments are summarized below and will take effect on October 14, 2016. Throughout this process, our primary goal is to provide investors with a broad spectrum of product choices for liquidity management with little to no disruption.
Government Money Market Funds
In the government money market fund category, the following products will be offered:
- TDAM U.S. Government Portfolio
- TDAM Institutional U.S. Government Fund
- TDAM Institutional Treasury Obligations Money Market Fund
Under the SEC's new rules, a government money market fund must invest at least 99.5% of its total assets in U.S. government securities, cash, or repurchase agreements collateralized by U.S. government securities or cash. Historically, TDAM has managed its government and Treasury funds consistent with this new requirement and will continue to do so. Government and Treasury money market funds are exempt from new requirements for liquidity fees and redemption gates, although they could voluntarily adopt fees and/or gates in the future upon prior notice to shareholders. TDAM does not intend to impose liquidity fees or redemption gates on any of its government or Treasury funds. Finally, government funds will continue to use the amortized cost method of valuation to transact at a stable net asset value (NAV) of $1.00 per share.
Retail Money Market Funds
In the retail money market fund category, the following products will be offered:
- TDAM Money Market Portfolio
- TDAM Municipal Portfolio
- TDAM California Municipal Money Market Portfolio
- TDAM New York Municipal Money Market Portfolio
Retail money market funds are defined under the new rules as funds that have policies and procedures reasonably designed to limit all beneficial owners to natural persons, whether investing directly or through an omnibus account held at a custodian. Retail money market funds will continue to transact at a stable NAV of $1.00 per share, but will be subject to liquidity fees and redemption gates.
Institutional Money Market Funds
Prime and municipal money market funds that are available to institutional investors must transact at a floating NAV and will be subject to liquidity fees and redemption gates. TDAM will offer the following floating NAV products:
- TDAM Institutional Money Market Fund
- TDAM Institutional Municipal Money Market Fund
Many of the changes set out above will require approval from the funds' board of directors and disclosure in the funds' registration statements. Therefore, the changes will not take effect until the necessary approvals have been obtained and the disclosures have been filed. TDAM's plan announced today should help investors move ahead with their liquidity planning solutions.
About TD Asset Management
TD Asset Management (TDAM), a member of TD Bank Group, is a North American investment management firm. Operating through TD Asset Management Inc. in Canada and TDAM USA Inc. in the U.S., TDAM brings new thinking to investors' most important challenges. TDAM offers investment solutions to corporations, pension funds, endowments, foundations and individual investors. Additionally, TDAM manages assets on behalf of almost 2 million retail investors and offers a broadly diversified suite of investment solutions including mutual funds, professionally managed portfolios and corporate class funds. Collectively, TDAM manages over $220 billion in assets as at December 31, 2015.
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SOURCE TD Asset Management Inc.