With the New Year celebrations now firmly behind us, Jim Fuell – Head of Global Liquidity Sales, International at J.P. Morgan Asset Management – gets back down to business by tackling some of the most important strategic challenges facing corporate treasurers over the next 12 months.
The implementation deadline for the new European Money Market Fund Regulations was January 21. What impact do you think the new regulatory regime will have on J.P. Morgan’s liquidity business?
There’s no doubt that preparations for regulatory reform in Europe have been challenging, for both corporate treasurers and fund providers. However, a great number of the changes have been positive and are to be welcomed.
We are fortunate that the size of our global liquidity platform, and the governance we already have in place around our money market funds, has allowed us to implement the regulations fully and ahead of time. With the recent clarification by the regulator that the reverse distribution mechanism used in euro-denominated money market funds will no longer be permitted, we will be undertaking a further modification to our euro money market funds which will be concluded by March 21 2019. The regulations have actually codified a large number of our existing risk controls and reinforced many of the things we have already been doing in our funds for some time.
I believe the more robust regulatory framework now in place in Europe will help money market funds to thrive. And I’m looking forward to engaging fully with investors to ensure they have access to the products they need to manage cash effectively in today’s increasingly challenging economic and interest rate environment.