SEC wants increased tri-party repo default preparations

07/23/2013 | Reuters

The Securities and Exchange Commission warned the money market fund industry to be aware of the risks posed by a collapse of the tri-party repurchase market, issuing new guidance last week. "There are a variety of ways in which a money fund and its adviser may be able to prepare for handling a default of a tri-party repo held in the fund's portfolio," the SEC wrote. "Such advance preparation could be part of broader efforts by the money market fund and its adviser to follow best practices in risk management."

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