I. Short-Term Investment Funds: OCC Adopts “Floating Rate” Requirement under Stress Situations -
Effective July 1, 2013, bank-maintained short-term investment funds for fiduciary accounts (“STIFs”) that are subject to Regulation 9 of the Office of the Comptroller of the Currency (“OCC”) are required to implement “floating NAV” unit pricing procedures in certain stress situations. Given the recent announcement that the Securities and Exchange Commission (“SEC”) “will not act to issue a money market fund reform proposal,” potentially including a floating per share net asset value (“NAV”), the OCC’s action creates a clear distinction – and potentially “uneven playing field” – between bank-maintained STIFs and money market mutual funds (“MMMFs”), which continue, at least for the time being, not to be subject to a floating NAV requirement.
The floating NAV requirement for bank STIFs is part of major changes to the rules governing STIFs (the “STIF Rules”) the OCC adopted on September 26th and published in the Federal Register on October 9. This Alert summarizes the highlights of the new STIF Rules. As described below, the new STIF Rules are substantially similar to the changes the OCC proposed earlier this year.
Please see full alert below for more information.
Firefox recommends the PDF Plugin for Mac OS X for viewing PDF documents in your browser.
We can also show you Legal Updates using the Google Viewer; however, you will need to be logged into Google Docs to view them.
Please choose one of the above to proceed!
LOADING PDF: If there are any problems, click here to download the file.