BISYS says the SEC has approved its application on behalf of 12 of its mutual fund clients and their investment advisers to be allowed to invest un-invested cash and cash collateral received through securities lending programs in shares of affiliated money market funds, in excess of statutory limits, and to collect the related fees. On July 8, 2003, the SEC issued an order permitting these investments in accordance with certain conditions.
The SEC order provides participating mutual fund groups with greater operating and investing flexibility. For example, non-money market funds can now invest up to 25 per cent of their assets in affiliated money market funds; and investment advisory fees, which are payable to investment advisers by investing funds, no longer have to be reduced by the amount of the advisory fees that are payable by affiliated money market funds on the value of the assets acquired.
“Our efforts and the resulting exemptive order provide tremendous benefits for BISYS’ s participating mutual fund clients, including added flexibility and efficiency in the management of their portfolios,” explains Lisa Hurley, executive vice president and general counsel of BISYS Fund Services. “We successfully advocated, on behalf of our clients, the elimination of certain limitations that previously prevented them from investing cash and cash collateral in affiliated money market funds.”
BISYS anticipates filing additional exemptive applications on behalf of other mutual fund clients and their investment advisers.