Featured Product

    EC Finalizes Regulation on Money Market Funds in the European Union

    June 30, 2017

    EC finalized Regulation (EU) 2017/1131, which lays down rules for money market funds (MMFs) established, managed, or marketed in the EU. These rules concern the financial instruments eligible for investment by an MMF, the portfolio of an MMF, the valuation of the assets of an MMF, and the reporting requirements in relation to an MMF.

    This regulation applies to collective investment undertakings that require authorization as UCITS or are authorized as UCITS under Directive 2009/65/EC or are alternative investment funds (AIFs) under Directive 2011/61/EU; invest in short-term assets; and have distinct or cumulative objectives offering returns in line with money market rates or preserving the value of the investment. Member states shall not add any additional requirements in the field covered by this regulation. With regard to reporting requirements, the regulation states that, for each MMF that it manages, the MMF manager shall report information to the competent authority of the MMF on at least a quarterly basis. For an MMF whose total assets under management do not exceed EUR 100 million, the MMF manager shall report to the competent authority of the MMF on at least an annual basis. The manager of an MMF shall, upon, request provide the information reported pursuant to the first and second subparagraphs also to the competent authority of the manager of an MMF, if different from the competent authority of the MMF.


    The reported information shall include information on the type and characteristics of the MMF; portfolio indicators such as the total value of assets, NAV, WAM, WAL, maturity breakdown, liquidity, and yield; results of stress tests and the proposed action plan; certain information on the assets held in the MMF portfolio; and certain information on liabilities of the MMF. If necessary and duly justified, the competent authorities may solicit additional information. In addition, for each Low Volatility Net Asset Value (LVNAV) MMF that it manages, the MMF manager shall report every event in which:


    The price of an asset valued by using the amortized cost method in accordance with the first subparagraph of Article 29(7) deviates from the price of that asset calculated in accordance with Article 29(2), (3) and (4) by more than 10 basis points

    The constant NAV per unit or share calculated in accordance with Article 32(1) and (2) deviates from the NAV per unit or share calculated in accordance with Article 30 by more than 20 basis points

    A situation mentioned in Article 34(3) occurs and the measures taken by the board in accordance with points (a) and (b) of Article 34(1)


    ESMA shall develop draft implementing technical standards to establish a reporting template that shall contain all this information. ESMA shall submit those draft implementing technical standards to the EC by January 21, 2018. Power is conferred on the EC to adopt the implementing technical standards in accordance with Article 15 of Regulation (EU) No 1095/2010. Competent authorities shall transmit to ESMA all information received pursuant to this Article. Such information shall be transmitted to ESMA no later than 30 days after the end of the reporting quarter. ESMA shall collect the information to create a central database of all MMFs established, managed, or marketed in the EU. ECB shall have a right of access to that database, for statistical purposes only. This regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from July 21, 2018, with the exception of Article 11(4), Article 15(7), Article 22, and Article 37(4), which shall apply from July 20, 2017.


    Related Link: Regulation (EU) 2017/1131

    Effective Date: July 20, 2017

    Keywords: Europe, EC, Banking, ESMA, Implementing Technical Standards, MMF, Securities, Asset Management

    Related Articles

    PRA Publishes Q&A on Property Valuation Requirements Under CRR

    PRA published a set of questions and answers (Q&A) covering common queries regarding residential and commercial property valuations, for the purpose of the Capital Requirements Regulation (CRR), during the period of disruption caused by COVID-19 pandemic.

    May 29, 2020 WebPage Regulatory News

    EBA Publishes Guidelines on Loan Origination and Monitoring

    EBA published guidelines on loan origination and monitoring, which bring together prudential standards and consumer protection obligations, along with the anti-money laundering and the Environmental, Social, and Governance (ESG) considerations.

    May 29, 2020 WebPage Regulatory News

    EBA Proposes Revised Standards for Own Funds and Eligible Liabilities

    EBA published a consultation paper on the draft amended regulatory technical standards on own funds and eligible liabilities.

    May 29, 2020 WebPage Regulatory News

    EBA Sets Out Supervisory Convergence Plan for 2020

    EBA published a report on convergence of supervisory practices in 2019.

    May 29, 2020 WebPage Regulatory News

    IOSCO Consults on Outsourcing Principles for Operational Resilience

    IOSCO proposed updates to its principles for regulated entities that outsource tasks to service providers.

    May 28, 2020 WebPage Regulatory News

    MAS Consortium to Develop AI Fairness Metrics for Credit Scoring

    MAS announced that the first phase of the Veritas initiative will commence with the development of fairness metrics in credit risk scoring and customer marketing.

    May 28, 2020 WebPage Regulatory News

    BoE Updates Definitions for BTL Data Collection

    BoE published the Statistical Notice 2020/4 to update the buy-to-let (BTL) Phase 2 and Phase 3 definitions for the Interest Rate Type data item.

    May 28, 2020 WebPage Regulatory News

    FSI Examines Financial Stability Implications of Payment Deferrals

    FSI published a brief note that examines challenges facing the banking sector as a result of the payment deferral programs put in place to support borrowers affected by the COVID-19 pandemic.

    May 28, 2020 WebPage Regulatory News

    RBNZ Publishes Financial Stability Report for May 2020

    RBNZ published the financial stability report for May 2020. This review of the financial system in the country highlights that the economic disruption associated with COVID-19 will present challenges to the financial system.

    May 27, 2020 WebPage Regulatory News

    PRA Finalizes Policy on Prudent Person Principle Under Solvency II

    PRA published the policy statement PS14/20, which contains the supervisory statement SS1/20 and the feedback to responses to the consultation paper CP22/19 on expectations for investment by firms in accordance with the Prudent Person Principle, or PPP, as set out in the Investments Part of the PRA Rulebook.

    May 27, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5234