The Securities and Exchange Commission is nearing completion of much-anticipated rules that are intended to protect some money market funds from investor runs similar to those that threatened to freeze corporate lending during the 2008 financial crisis, The Wall Street Journal reports.
The two-part plan—which a person familiar with the matter told Bloomberg is likely to be voted on by the five-member commission on July 23—would require prime institutional funds, which invest in short term corporate debt, to float their share price instead of keeping it fixed at $1. It would require funds to impose a 1 percent fee on redemptions and allow them to temporarily suspend withdrawals during times of market stress, Bloomberg reports.
