The SEC voted unanimously to propose new rules intended to reform money market funds. The SEC proposed two alternatives, in addition to additional disclosures, regulatory reporting, diversification requirements and stress testing. SEC Commissioners indicated that the proposal is designed to address liquidity concerns identified in the wake of the 2008 financial crisis. Several Commissioners also noted that the SEC was the appropriate oversight body for money market funds, in light of the FSOC’s focus on this issue.
The SEC is requesting comments on each proposal separately, as well as whether both proposals should be enacted together. The comment period is 90 days.