Legg pumps $630M into money market funds

Legg Mason Inc. has entered into agreements to support three money market funds: Citi Institutional Cash Reserves, Western Asset Institutional Money Market Fund and a fund for offshore investors, CILF U.S. Dollar Liquidity Fund.
SEP 19, 2008
Baltimore-based Legg Mason Inc. announced today that the firm has entered into agreements to support three money market funds: Citi Institutional Cash Reserves (CILXX); Western Asset Institutional Money Market Fund (INSXX); and a fund for offshore investors, CILF U.S. Dollar Liquidity Fund. The funds are managed by Western Asset Management. Legg amended an existing capital agreement to provide for an additional $350 million for Citi Institutional Cash Reserves and entered a new agreement for $20 million for Western Asset Institutional Money Market Fund, due to the funds’ holdings of troubled asset backed commercial paper securities. To maintain the AAA rating of the offshore fund, Legg acquired two letters of credit that will provide additional $260 million in support for the securities. The funds have no exposure to Lehman Brothers Holding Inc.or American International Group, Inc., both of New York. or Washington Mutual Inc., of Seattle, Legg noted in a statement. “The firm may take additional action if we deem it appropriate,” chief executive Mark Fetting said in a statement. He added that “no guarantees can be given.” The firm expects to incur $318 million in charges in the current quarter as a result of the agreements, which are expected to cut into profits by $1.33 per share. Legg Mason had $923 billion in assets under management as of June 30 and $187 billion in liquid assets as of Sept. 17.

Latest News

Merrill lands four advisor teams as May recruiting data shows firm's two-way churn
Merrill lands four advisor teams as May recruiting data shows firm's two-way churn

Merrill's latest hires span Colorado to Louisiana, even as industry-wide recruiting data suggests the firm is losing almost as many advisors as it gains.

Fund manager sues Kandeo, alleges $100 million FinSocial loss
Fund manager sues Kandeo, alleges $100 million FinSocial loss

The $36 million buy allegedly hid inflated books and a $50 million diversion.

Advisor gets $200,000 from Ameriprise in 'emotional distress' lawsuit
Advisor gets $200,000 from Ameriprise in 'emotional distress' lawsuit

“An award citing emotional distress is very unusual,” an industry executive said.

Workplace financial education linked to stronger financial habits, but participation remains low
Workplace financial education linked to stronger financial habits, but participation remains low

New EBRI research found workers who participated in employer financial education reported higher confidence, literacy and financial satisfaction.

The rise of the super advisor: How AI is redefining competitive advantage in wealth management
The rise of the super advisor: How AI is redefining competitive advantage in wealth management

Beyond operational excellence, the winning advisors of the future are the ones who can reach across multiple disciplines without discarding specialist skills.

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income