BNY Mellon Asset Servicing, a global provider of securities servicing and Investor Analytics, a global provider of risk measurement and risk management solutions, have been selected by Reich & Tang Asset Management, to provide money market stress tests that will model the impact of interest-rate shocks, credit risk shocks and liquidity risk shocks on their funds.
This new service, available through BNY Mellon’s strategic alliance with Investor Analytics, will help money market funds comply with Rule 2a-7 issued by the US Securities and Exchange Commission (SEC). The rule, which becomes effective May 5, 2010, requires money market funds to examine combinations of potential stresses.
The suite of stress tests were developed by Investor Analytics and is available through BNY Mellon’s asset servicing technology platform. The tests will examine changes in fund NAV resulting from: parallel and non-linear shifts in yield curves; changes in credit spreads; increasing redemption requests and combinations of the three above.
Joseph Jerkovich, senior vice president and chief financial officer of Reich & Tang Asset Management, said: “Our selection of BNY Mellon Asset Servicing was based on its ability to provide an objective, end-to-end solution that will facilitate both Reich & Tang and our fund directors in meeting their obligations under the new SEC and rating agency requirements.”
Joseph Keenan, managing director and head of relationship management for financial institutions at BNY Mellon Asset Servicing, said: “This offering is a timely extension of the wide range of services that we provide to mutual fund complexes such as custody, fund accounting, fund administration, and performance and analytics.”
Damian Handzy, CEO of Investor Analytics, said: “Money market funds need to do more than just satisfy regulatory requirements in assessing their risks. They need an easily understood report that accurately alerts them to the conditions that can jeopardize their funds.”
Reich & Tang Asset Management, a provider of cash management services, is an affiliate of Natixis Global Asset Management.