24/05/2012
US money market funds adopt wait-and-see attitude to European banks
As a whole, aggregate U.S. prime money market fund exposures to European banks declined marginally by 2% on a dollar basis since end-March, according to Fitch Ratings in a new report published on May 23. The decline in exposure to U.K. and Dutch banks was partially offset by increased exposure to German banks. Overall, euro zone exposure has held steady over the past three months, but remains 63% belowend-May 2011 levels. Exposure to banks in Australia, Canada, and Japan as a group was largely unchanged at 29% of MMF assets under management.Following reduced allocations to euro zone banks that took place during the second half of 2011, MMF holdings appear to be following a “wait andsee” approach until a clearer pattern emerges, comments Fitch.
