The
The guarantee program will apply to both taxable and non-taxable money market fund assets as of close of business on Sept. 19 and cover funds that are registered with the
Although the Treasury initially said the program would be open for a full year, it now says it will be in effect for an initial three-month term, after which time the Secretary of the Treasury Henry Paulson will review the need and terms for the program. Funds have until Oct. 8 to sign up at:
The program protects the $1 net asset value per share of all money market fund investors as of the close of business on Sept. 19 if their fund breaks the buck, or falls below $0.995, as long as it signs up for the program. Funds will need to renew their participation in the program after the initial three-month trial period and any subsequent extension. It will only apply to holdings as of Sept. 19. Should an investor subsequently purchase additional shares at a later time, those additional shares will not be covered.
The Treasury Department said investors whose funds are participating in the program could expect to receive redemptions within 30 days and that investors need to contact their fund company individually to find out if they are participating in the program.
In order to participate in the program, funds must have had an NAV per share of at least $0.995 as of the close of business on Sept. 19. The fee to participate in the program will be 1.5 basis points for funds with NAVs between $0.995 and $0.997 and one basis point for funds with NAVs of $0.997 or greater.
The Treasury has directed fund companies that have questions about the program to send e-mails to:
Stevens also commended the Bush Administration and the bipartisan leadership in the