Through this program, the U.S. Treasury will guarantee the share price of any eligible money market mutual fund—whether retail or institutional—that applies for and pays a fee to participate in the program (see Treasury Opens Guarantee Program for Money Funds).
“We recognize the U.S. Treasury’s actions to address what are believed to be temporary dislocations in the credit markets,” said Kai Sotorp, Head Americas, UBS Global Asset Management. “While the UBS money market funds have maintained their $1 net asset value throughout the recent unprecedented turmoil and continued to meet their stated goals of capital preservation, liquidity and income, we are pleased to have the Funds participate in the U.S. Treasury’s Temporary Guarantee Program to provide an added level of protection for covered shareholders.’ According to the announcement, the funds continue to operate normally, and maintain a stable net asset value of $1 per share.
UBS joins Putnam (see Putnam Signs Up for Money Fund Guarantee Program) and Morgan Stanley Investment Management (see MSIM Signs Up for Treasury Guarantee Program) in applying for their money market funds to be included in the program.
The temporary guarantee program provides coverage to shareholders for amounts that they held in participating money market funds as of the close of business on September 19. The guarantee will be triggered if a participating fund’s net asset value falls below $0.995, commonly referred to as “breaking the buck.” While the program protects the accounts of investors, each money market fund makes the decision to sign up for the program. Investors cannot sign up for the program individually.
UBS says the following money market funds will apply to be insured under the program:
- UBS US Taxable Money Market Funds
- UBS Cashfund
- UBS Cash Reserves Fund
- UBS Liquid Assets Fund
- UBS Money Market Fund
- UBS PACE Money Market Investments
- UBS RMA Money Market Portfolio
- UBS Retirement Money Fund
- UBS RMA U.S. Government Portfolio
- UBS Select Prime Institutional Fund
- UBS Select Prime Investor Fund
- UBS Select Prime Preferred Fund
- UBS Select Treasury Institutional Fund
- UBS Select Treasury Preferred Fund
- UBS Select Treasury Investor Fund
- US Tax-Free Money Market Funds
- UBS RMA New Jersey Municipal Money Fund
- UBS RMA California Municipal Money Fund
- UBS RMA Tax-Free Fund
- UBS RMA New York Municipal Money Fund
- UBS Select Tax-Free Institutional Fund
- UBS Select Tax-Free Preferred Fund
- UBS Select Tax-Free Investor Fund
A list of Frequently Asked Questions (FAQ) about the Treasury Department’s Temporary Guarantee Program for Money Market Funds, a program that will guarantee the share price of any publicly offered eligible money market mutual fund, is available here.