FHLBs Biggest Beneficiaries of Money-Market Reform, Fitch Says
(Bloomberg) -- Federal Home Loan Banks (FHLBs) have been the biggest beneficiaries of the SEC’s money-market reforms, with govt fund assets boosting their agency holdings to $508b as of July from $158b in October 2015, Fitch strategists Winnie Lee-Cember and Greg Fayvilevich say in note.
- Of the $1.1t increase in govt money fund assets between October 2015 and July of this year, $387b (35%) was allocated to U.S. agencies and $266b (24%) to U.S. Treasuries
- As many as 82 funds have invested more than 20% of their assets in FHLBs vs 34 funds prior to reform, according to data from most recent reporting period
- 20 funds have allocated more than half of their portfolios to FHLBs
- Money market funds also have indirect exposure to agency debt as they’ve also increased their repo holdings to $266b in July from $114b in October 2015
To contact the reporter on this story: Alexandra Harris in New York at aharris48@bloomberg.net To contact the editors responsible for this story: Boris Korby at bkorby1@bloomberg.net Vivien Lou Chen
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HALISTER1Source: BFW (Bloomberg First Word)
Tickers 1799Z US (Federal Home Loan Banks)
People Gregory Fayvilevich (Fitch Ratings Ltd)
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