In the News

3 min readFrom December 2015 through June 2017, the Federal Reserve raised the short-term benchmark interest rate four times, each time in an increment of 25 basis points. But according to national average deposit rates published by the Federal Deposit Insurance Corp., the interest rates banks are paying depositors have barely budged. This has occurred even though…

5 min readCapital Advisors Group published a research paper entitled, “Higher Deposit Rates – Where Art Thou?” The Abstract explains, “Bank deposits have not benefitted from recent fed funds rate increases. The absence of higher rates contrasts sharply with the yields on marketable securities and compares unfavorably with deposit rates seen in two previous Fed tightening cycles. Although prospects for higher…

5 min readAs the one-year anniversary of new regulations affecting money market funds approaches this fall, the money fund landscape seems permanently altered. The imposition of floating net asset values and fees and gates on institutional prime and municipal funds scared away investors, shrinking the assets held in those types of funds. That decline, and the impact…

2 min readThe Treasury Investment Managers’ Peer Group 2 talks tax reform, counterparty risk and vehicles for short-term liquidity in meeting sponsored by Capital Advisors Group.  In an effort to prepare for possible tax repatriation and the transition from high government money market fund balances to a higher yielding alternative, members reviewed their investment options during the…

2 min readCapital Advisors published, “Revisiting Bank Deposits as a Liquidity Solution.” The piece says, “​The search for liquidity management solutions reached a new level of significance when institutional prime money market funds were required to float net asset values (​NAVs) last fall. While treasury organizations may consider bank deposits as a fallback liquidity solution, regulatory changes,…

6 min readCapital Advisors Group published a paper entitled, “Demystifying Private Liquidity Funds,” which reviews a recent SEC paper on Private Liquidity Funds and recent SEC Statistics on this over $​500 billion and little noticed segment of the money markets. CAG’​s Lance Pan explains, “Important regulatory changes to institutional prime money market funds are forcing new ideas…

9 min readCapital Advisors Group writes “Using Separately Managed Accounts (​SMAs) to Ride the Tides of Uncertainty,” which explains, “​Recent events serve as a prelude to what is to come from the new administration. Active cash portfolio management with a separate account solution helps manage policy uncertainty, market volatility, headline and geopolitical risk. Fiscal and monetary policies,…

7 min readThe new regulations imposed on money market funds last fall triggered a huge migration of assets out of institutional prime funds. And three months after the changes took effect, institutional investors still seem to be wary of heading back into prime funds. More than $1 trillion in assets exited institutional prime funds after the Securities…