Press release
Northern Trust Asset Management Announces Changes to Money Market Mutual Fund Suite
CHICAGO--(BUSINESS WIRE)-- Northern Trust Asset Management, which oversees $339 billion in liquidity and short-duration strategies globally as of Sept. 30,
About this update from Northern Trust Corporation
[{"type":"text","content":" CHICAGO--(BUSINESS WIRE)--\nNorthern Trust Asset Management, which oversees $339 billion in liquidity and short-duration strategies globally as of Sept. 30, 2020, announced the following changes to its suite of money market mutual funds:\n\n\nThe Northern Funds- Municipal Money Market Fund (NOMXX) and the Northern Institutional Funds- Municipal Portfolio (NMUXX) will both close to new investors on or about January 11, 2021. Final liquidating distribution of the funds’ assets will occur on or about February 12, 2021.\n\n\n\nA proposed merger of the Northern Funds Money Market Fund (NORXX) into the Northern Funds- U.S. Government Money Market Fund (NOGXX), subject to shareholder approval.\n\n\nThese fund lineup changes highlight a thoughtful progression by Northern Trust Asset Management to exit the prime and municipal money market mutual fund space, a process that began back in May 2020 with the closure of the institutional prime money market mutual fund, the Northern Institutional Funds - Prime Obligations Portfolio.\n\n“Given our strongly held, long-term views on interest rates, coupled with shifting investor preferences and the potential for continued regulatory changes, appropriate action was needed with our money market mutual fund offering,” said Jen Hoffenkamp, who oversees Northern Trust Asset Management’s liquidity products. “Our investment strategies are rooted in the foundational belief that investors should be compensated for the risks they take, and we are committed to delivering investment products and solutions that fit our investor-centric approach.”\n\nNorthern Trust Asset Management anticipates that U.S. interest rates will remain anchored near zero for the foreseeable future. In a continued low interest rate environment, investors in municipal and prime money market mutual funds earn yields comparable to government money market funds. “In our opinion, the risk/reward profile for these investors has become misaligned,” said Peter Yi, Northern Trust Asset Management’s director of short-duration fixed income and head of taxable credit research. “Our view is that the constraints limiting municipal and prime money market mutual funds today will not improve significantly over time. The money market mutual fund landscape has fundamentally changed.”\n\nGenerally, prime and municipal money market mutual funds have decl...