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Chinese Money Market Funds - Declining Yields, Regulation and Competing Products Signal Slowing Growth

Fitch Ratings believes the growth of Chinese money market funds will come under pressure in the short- to medium-term from negative real yields, tight regulatory requirements, and competition from certain wealth management products. Growth in Chinese MMFs’ assets under management slowed down in 2018, rising by 13% versus 57% in 2017. Total assets declined to CNY7.3 trillion (USD1.1 trillion) by end-June 2019 from a peak of CNY8.9 trillion (USD1.3 trillion) in 2H18.

Woodford Fallout Shows Risks from Financial System Connectivity

Fallout from the suspension of redemptions (gating) from the Woodford Equity Income Fund is an example of how problems at one entity can quickly spread to related entities and other parts of the financial system. Problems can spread due to crossholdings in sister funds or reduced investor confidence in other funds with the same manager, affecting investors as well as banks and other counterparties providing leverage to funds.

Webinar on Demand

Fitch Expects to Rate Nassau 2019 CFO LLC (a Private Equity Securitization)

Fitch Ratings has assigned the expected ratings to be issued by Nassau 2019 CFO LLC, a collateralized fund obligation of private equity fund interests (PE CFO). Please listen as our analysts discuss the expected ratings.


Listen Now

Fitch Launches Local Government Investment Pool Dashboard

The inaugural edition of the LGIP dashboard focusses on the increase in assets in 1Q19, rising yields in line with interest rates, and the potential for increases in duration if the Fed's monetary policy turns more accommodative. The data used to construct this dashboard is from two newly launched Fitch indices focused on U.S. LGIPs: the Fitch Liquidity LGIP Index and the Fitch Short-Term LGIP Index, which consist of data from a select group of LGIPs with approximately $241 billion in assets under management as of 1Q19.

Heightened Focus on Global ESG Risk for Money Market Funds

ESG investment considerations have become more integrated into money market funds in Europe and the US, with governance considerations having an important influence on the exclusion of potential investable assets. However, MMFs' core investment objectives of liquidity and preservation of capital have resulted in high-quality, low-risk investment profiles already aligned with ESG core investment objectives.

Financial Times: ESG money market funds grow 15% in first half of 2019


Europe's five biggest HY funds offer limited liquidity

Europe's high yield bond fund sector has significant liquidity risks, according to a report by ratings agency Fitch. The company said most funds in the space offer daily liquidity despite limited allocations to highly liquid investments. Read the article on Citywire

French Money Market Funds

Reforms Strengthen Credit Profiles, but Structural Differences Remain

Fitch Ratings believes that the recent European money market fund (MMF) reforms did not materially affect the French MMF industry. The French MMF sector is made up of mainly Variable Net Asset Value (VNAV) funds, which faced considerably fewer regulatory changes than the majority of MMFs domiciled in Ireland and Luxembourg, where MMFs converted primarily to the Low Volatility Net Asset Value (LVNAV) type.


Fitch Expects to Rate Astrea V Pte. Ltd (a Private Equity Securitization)

Date: May 30, 2019

APAC Time: Singapore 10:00 AM

EMEA / Americas Time: New York 10:00 AM  |  London 3:00 PM

Fitch Ratings has assigned the expected ratings shown in the table inside to the A-1, A-2, and B bonds expected to be issued by Astrea V Pte. Ltd., a collateralized fund obligation of private equity fund interests (PE CFO). Astrea V owns interests in a diversified pool of 38 private equity funds, with approximately $1.3 billion net asset value.

Fitch's Fund and Asset Managers team will host a webinar to discuss the ratings analysis.

Greg Fayvilevich
- Senior Director, Head of U.S. Fund & Asset Manager Ratings

Igor Gorovits - Associate Director, Fund & Asset Manager Ratings

Register Now: APAC  |  EMEA / Americas

1Q19 Dashboard

Green Bond Fund Sector Maintains Strong Growth

Fitch Ratings estimates that European green bond fund assets under management reached EUR5.4 billion at end-December 2018, registering 83% growth from 2017. This compares with a 3% contraction in the European bond market overall in the same period. However, these funds remain tiny in the context of the broader fixed income fund market

Fitch Ratings Updates Money Market Fund Rating Criteria

Going forward, Fitch will emphasize Short-Term ratings for various elements of its MMF criteria including the Portfolio Credit Factor (PCF), minimum credit quality standards for repurchase agreement counterparties and eligible investments. 


Finalized Short-Term Ratings Criteria

Our new criteria offers a more appropriate reflection of a company’s near-term credit risk, improves transparency into the attribution of short-term ratings, and ensures the short-term rating scale provides increased value to investors.


Join our webinars on Tuesday, May 7, where we’ll discuss our finalized short-term ratings criteria and its impact on existing ratings.


EMEA Session

Date: May 7 
Time: 14:00 BST

Register Now


North America Session

Date: May 7
Time: 2:00pm EST

Register Now


Hong Kong MMF Regulation Converging with International Standards

Regulatory change in late 2018 has brought Hong Kong money market fund (MMF) regulation closer to international standards. The changes strengthen portfolio risk control, but also favour variable net asset value (NAV) over constant NAV funds, as in other international markets. 

Special Report

European MMF Reform: March 2019 Dashboard

European MMF reform formally concluded on 21 March 2019, two months later than originally anticipated, following the last-minute European Commission ruling that reverse distribution mechanisms would not be permitted.

European Regulatory Developments May Influence Singaporean MMF Demand

Fitch Ratings believes that Singapore-based institutional investors who have to date primarily used Europe-domiciled money market funds (MMFs) may turn to locally domiciled funds instead, due to the recently implemented regulatory reforms of European MMFs. The reforms will result in some fund types being replaced by new types and the introduction of new features, such as liquidity fees and redemption gates specific to MMFs. 

Special Report

European MMF Reform Dashboard: February 2019

Fitch estimates that around 75% of European short-term MMFs have been converted to their post-reform formats at end-February 2019. The remainder will be converted in March.

UK Property Funds May Gate Due to Brexit Fear Despite Liquidity

Investors in open-ended UK property funds face a growing risk that the funds will prohibit withdrawals by imposing redemption gates as a reaction to market fears that property values will fall because of Brexit.

ESG Risk

Introducing ESG Relevance Scores for Financial Institutions

Nearly 20% of global financial institution ratings are currently influenced by governance risk according to an analysis of new Environmental, Social & Governance (ESG) Relevance Scores. ESG risks overall have a low level of direct impact on financial institution credit ratings. The scores cover over 900 banks, non-bank financial institutions and insurance companies around the globe. Download our ESG Financial Institutions special report to learn more


ESG Relevance Scores for Financial Institutions

Thursday 7 March | 10am EST | 3pm GMT

Join our analysts from Insurance, Banks and NBFI, for a webinar providing a detailed overview of our approach to ESG, our analytical framework, and the deliverables that are available to market participants.

It Ain't Over Till Its Over - European Money Market Fund Reform Continues

Fund managers implementing money market fund (MMF) reforms are having to deal with last-minute changes requested by regulators. The reforms were meant to be concluded by January this year, but have now been pushed back to March.

Credit Hotspot: EU MMF Reform

Latest: Webinar: MMF Reform – Countdown to 2019


Open-Ended Bond Funds a Potential Risk to Financial Stability

Open-ended bond funds are a potential risk to global financial stability given their rapid growth and increasing liquidity mismatches and credit risk.
Financial Times: Fitch Flags Risks of Forced Sales for Bond Mutual Funds


Update on Delays to European MMF Reform Process

NOW available on-demand

During the webcast, Alastair Sewell, Fitch’s EMEA head of fund ratings, will update you on recent delays to fund conversions and what to watch now in a fast changing environment for MMF investors. He will also discuss options for euro fund investors and the behaviour of funds already converted to the new fund types. Register Now


What to Watch in Money Market Funds Reform

Alastair Sewell, Senior Director, Fund & Asset Manager, Fitch Ratings talks about Chinese and European Market Reform, US MMF Tax implications and Brexit sensitivities. He speaks on "Bloomberg Markets: Rules and Returns".


China's Digital Economy a Key Driver of Money Market Fund Growth: Fitch

Alastair Sewell, Senior Director at Fitch Ratings, discusses the regulatory landscape for money market funds.

2019 Outlook

Fitch Ratings 2019 Outlook: Global Money Market Funds

European money fund reform will reach completion in 2019, regulatory intervention will likely persist in China where assets have seen significant growth, and U.S. MMFs, having adjusted to 2016 reforms, could benefit from rising rates and the return of foreign cash.


How China's Regulatory Reforms are Impacting Money Market Funds

Regulatory tightening is causing outflows from money market funds, says Alastair Sewell, Head of Fund and Asset Manager Group for EMEA and APAC, Fitch Ratings.
Bloomberg: China Money Market Funds Set to Grow

European ABS Fund Dashboard 2H18

Dedicated asset-backed security (ABS) funds are emerging as a niche investment segment in the European fund market. Fitch Ratings estimates that assets under management in these funds were about EUR30 billion at end-June 2018.

Chinese MMF Concentration Risk

The Chinese money market fund (MMF) industry will continue to diversify due to sustained regulatory intervention. However, the industry remains highly concentrated, with 27% of total assets held in the three largest funds as of end-June 2018.

Rate Rise Benefits Sterling Liquidity Investors, Managers

Today's UK base rate hike to 0.75% from 0.50% is positive for short-term sterling investors and money market fund providers. The ultra-low duration of liquidity, or money market, funds means that rate rises have limited effects on asset values while allowing such funds to quickly reset to the new rate environment.

Webcast on Fitch's Proposed Changes to Short-Term Ratings

Fitch is proposing changes to its approach in assigning Short-Term ratings and wants to hear your feedback. The proposal considers ways to offer a more differentiated analytical view of short-term risk between issuers, including changes to the correspondence table between Long-Term and Short-Term ratings. View More

Fitch Publishes End-May 2018 STBF Compare

Fitch Ratings has published its end-May 2018 short-term bond fund (STBF) Compare, which covers close to EUR60 billion equivalent assets under management across 21 Fitch-rated short-term bond funds.

rating action

Fitch Rates Barings USD Liquidity Fund 'AAA(mmf)'

As the fund has only recently been launched, its current portfolio composition may not yet be reflective of its investment guidelines or target portfolio composition. Therefore, Fitch will monitor the fund closely during the first few months of its existence as it moves towards its eventual portfolio construction.

Fitch Publishes Cross-Sector Discussion Paper on Short-Term Ratings

Fitch published a Discussion Paper exploring possible changes to its approach in assigning short-term ratings, including the current correspondence table between Long-Term and Short-Term Issuer Default Ratings (IDRs). We are considering ways to offer a more differentiated analytical view of short-term risk between issuers. Fitch is seeking feedback from market participants by October 31, 2018.

Fitch Debuts European Money Fund Reform Dashboard

Fitch Ratings has published the first edition of its European money market fund reform dashboard. As the final implementation of the European reforms approaches Fitch will publish regular updates on the latest developments in the European money fund sector.

Teleconference Replay

Teleconference: Fitch Expects to Rate SWC Funding LLC (a PE CFO)

Fitch's Fund and Asset Managers team hosted a teleconference to discuss the ratings analysis of SWC Funding LLC.
Speakers: Greg Fayvilevich - Senior Director, Head of U.S. Fund & Asset Manager Ratings, Brian Knudsen - Associate Director, Fund & Asset Manager Ratings

Webinar Replay

European Money Market Fund Reform Implementation and Outlook

Fitch Ratings held a webinar on the European money market fund reform implementation and outlook. Speakers: Alastair Sewell, Senior Director, Fund and Asset Management


Listen to Replay

Fitch Assigns SWC Funding Expected Ratings; Issues Presale

Fitch Ratings has assigned expected ratings to the liquidity facility and notes issued by SWC Funding LLC (SWC Funding) as noted below. SWC Funding is a collateralized fund obligation managed by Sightway Capital, LP (Sightway), which is an affiliate of Two Sigma Investments, LP. (Two Sigma). 

Lloyds Contract a Big Prize for Squeezed Asset Managers

The contract to manage GBP109 billion of assets for Lloyds Banking Group offers a rare opportunity for investment managers to bid for such a large mandate, with the prospect of gaining significant scale benefits.

Green Bond Funds Not Immune to Conventional Bond Risk

Alastair Sewell from Fitch's NBFI group discusses recent developments in sustainable investment funds, with a focus on green bond funds' exposure to credit and market risk. This video originally formed part of Fitch's 2018 Viking Tour.

China's Tighter MMF Regulations Won't Halt Sector Growth

One effect of the changes will be to discourage retail clients from viewing and using their MMF investments like bank deposits, but there will be only a limited impact on most investors, and, moreover, there is a lack of competing investment products for clients. 

European Money Fund Reform

European money fund reform is coming soon. While it will mean changes for corporate treasurers, we do not expect as significant flows as in the US.

Webcast: How to Prosper Under EU MMF Rules

Listen again to the Ignites Europe webcast featuring Fitch's Alastair Sewell, Regional Head of Fitch Ratings’ Fund and Asset Manager Group for EMEA and APAC on how to prosper under EU money market fund rules. To access re-type your company name in the Membership ID field.


Alastair Sewell


Alastair Sewell


+44 203 530 1147

Sing Chan Ng


Sing Chan Ng


+65 6796 7210

Etienne Sabot

EMEA (French Speaking)

Etienne Sabot


+33 144 29 92 70

David Turner


David Turner


+44 203 530 1147

Kathleen Plunkett


Kathleen Plunkett


+44 203 530 1435

Davie Rodriguez


Davie Rodriguez


+1 212 908 0386

Diego Alcazar


Diego Alcazar


+1 212 908 0396

Greg Fayvilevich


Greg Fayvilevich


+1 212 908-9151

Constantine Schidlovsky

North America

Constantine Schidlovsky


+1 212 908 0718

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