IRELAND: Central Bank & Money Market Funds

Monday May 14 2018

Michael Hodson, Director of Asset Management Supervision at the Central Bank of Ireland was speaking at the FOW Trading Dublin Conference. In his address, he discussed Money Market Funds.

Almost four years after the European Commission proposed new rules to regulate these funds, the Regulation on Money Market Funds (‘MMFR’) came into force on 20 July 2017. Since inception, the Central Bank has been involved throughout the lengthy negotiation process and continues to work with ESMA in relation to certain deliverables they were tasked with under the Regulation. This work included

1. i) technical advice and implementing technical standards for submission to the Commission; and
2. ii) guidelines on stress testing.

In brief, the Regulation impacts all money market funds (‘MMF’s’), both UCITS and Alternative Investment Funds (‘AIFs’) who are established, managed or marketed in the EU and applies 12 months after date of entry into force, which take us to the 20 July 2018.

For existing MMFs, they are afforded an additional transitional period, and these funds must be authorised and in compliance by the 21 January 2019. Of note, the majority of MMFs in Ireland are authorised as UCITS funds.

A key priority in 2018 for the Securities and Markets Directorate within the Central Bank is the implementation of this Regulation.

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