White offers little on future of MM reform

Making her first major public speech to an audience of mutual fund executives, Securities and Exchange Commission Chairman Mary Jo White said next to nothing about one of their biggest concerns: a regulatory revamp for money market funds. “As the SEC works to develop and propose meaningful money market fund reform, our goal is to preserve the economic benefits of the product while addressing potential redemption pressures and the susceptibility of these funds to runs — runs in which retail investors are especially likely to suffer losses,” she told the audience at an Investment Company Institute conference in Washington last Friday. The SEC scrapped a proposal last summer that would have offered a couple of alternatives for strengthening rules. One would have allowed the net asset value of funds to fluctuate with changing market conditions; the other would have been to require funds to maintain capital reserves and institute redemption controls. The SEC will re-propose a money fund rule “in the near future,” Ms. White said without offering specifics, even when ICI president Paul Schott Stevens tried to draw her out during a Q&A session.