Federal Register Version of SEC'​s Money Market Fund Reforms Posted

The more printer-​friendly (​62-​pages) Federal Register version of the SEC'​s Money Market Fund Reforms was recently posted on the SEC'​s Final Rules web page. Also, the New York Federal Reserve, which yesterday issued its "Statement Regarding Counterparties for Reverse Repurchase Agreements," added a clarifying document, "RRP Eligibility Criteria for Money Funds: Frequently Asked Questions." A couple of the Q&​A'​s include: "Does the $​20 billion net assets requirement apply to the money fund or the fund family? The net asset requirement applies to the RRP counterparty applicant, which is the money market fund itself. As stated in the RRP Eligibility Criteria for Money Funds, to be accepted as a RRP counterparty, an applicant must, among other things, be a money market fund that satisfies the description set forth in Section I(​A) and have net assets of no less than $​20 billion for six consecutive months (​measured at each month-​end) prior to the submission of the application.... Will a seven-​day put option be provided to money market funds who become RRP counterparties? Yes. As stated in footnote 4 in the RRP Eligibility Criteria for Money Funds, it is contemplated that for RRP with terms exceeding seven days, the RRP counterparty will be permitted to resell the securities to the New York Fed upon seven days prior notice. The specifics of this option will be provided in the New York Fed'​s Master Repurchase Agreement for money market funds, which the New York Fed expects to publish in about a month."

"Money Funds Welcome Repo Shift"

The Wall Street Journal writes "​Money Funds Welcome Repo Shift". It says, "​The New York Federal Reserve has at least three -- and probably many more --​willing potential partners as it plans to expand the tools used to control liquidity in financial markets. Vanguard Group, Fidelity Investments and Federated Investors on Monday welcomed the New York Fed'​s announcement that it will expand the counterparties, starting with money funds, with which it conducts reverse-​repurchase agreements." The Journal quotes Vanguard Group'​s David Glocke, "We would enthusiastically want to take a look at these transactions for our portfolios. It'​s a great alternative to other transactions that we already do." The piece continues, "Money-​market funds applying to act as counterparties must have net assets of no less than $​20 billion for six consecutive months, have been in existence for at least one year and be a consistent investor in the tri-​party repo markets, according to the New York Fed'​s eligibility criteria.... Others in the $​3.​1 trillion money-​fund industry are likely to be cheered by the prospect of deals with a party as trusted as the Fed. The supply of safe assets in which money-​market funds can invest has dwindled during the financial downturn, and plans for tighter rules on just how money-​market funds can invest are likely to make liquid assets even more scarce. Access to the '​reverse repos' will actually help money funds comply with the new Securities and Exchange Commission rules, said Peter Crane, president of Crane Data LLC, 'As those go into effect, there'​s going to be even more of a thirst for liquidity.'" See also, New York Daily News' "​Government to institute new standards that may make money-​market funds safer for investors".

"​Island Intellectual Property Awarded Additional Patents for FDIC Cash Sweep Technology"

"​Island Intellectual Property Awarded Additional Patents for FDIC Cash Sweep Technology" says a release posted on DoubleRock'​s website. It says, "Island Intellectual Property LLC, which owns and manages the intellectual property for Double Rock Corporation, its subsidiaries, and affiliates, is pleased to announce that on March 2, 2010, the U.​S. Patent and Trademark Office issued three additional patents relating to its FDIC cash sweep technology.... Adding to its already impressive patent portfolio, Island IP has been awarded five (​5) patents thus far in 2010 relating to its innovative expanded FDIC cash sweep programs. The patents awarded on March 2nd apply to FDIC sweep products offered in the broker-​dealer, banking and retail markets." A Feb. 23 release, entitled, "Island Intellectual Property Awarded Additional Patents for Innovative FDIC Sweep Technology," said, "Island IP and Intrasweep LLC filed a federal lawsuit on February 23, 2010, in the U.​S. District Court for the Southern District of New York, seeking to enforce the ... Patents -- Docket No. 10-​cv-​1518, ISLAND INTELLECTUAL PROPERTY LLC and INTRASWEEP LLC v. DEUTSCHE BANK TRUST COMPANY AMERICAS, and TOTAL BANK SOLUTIONS, LLC." DoubleRock'​s patents, listed here, include: U.​S. Patent No. 7,​672,​886, "Systems and Methods for Managing Client Accounts," U.​S. Patent No. 7,​672,​901, "System and Method for Holdback Procedure for After-​Hours Transactions," U.​S. Patent No. 7,​672,​902, "System and Method for Pre-​Funding Interest for Early Termination of Client Account Having Funding In One or More Aggregated Account," U.​S. Patent No. 7,​668,​771, "System and Method for Allocation to Obtain Zero Activity in a Selected Aggregated Account," U.​S. Patent No. 7,​668,​772, "Systems and Methods for Money Fund Banking With Flexible Interest Allocation," U.​S. Patent No. 7,​509,​286, "Systems and Methods for Money Fund Banking with Flexible Interest Allocation," U.​S. Patent No. 7,​519,​551, "Systems and Methods for Administering Return Sweep Accounts," U.​S. Patent No. 7,​536,​350, entitled "Systems and Methods for Providing Enhanced Account Management Services for Multiple Banks."

Barron'​s writes on "​Money-​market reform"