FYI: An Update on Emerging Issues in Banking

Effects of Interest Rates on Money Market Mutual Funds

May 19, 2004

Overview

The prolonged low interest rate environment has pressured returns on money market 

mutual funds (MMMFs). Although low rates are a boon to borrowers, the opposite, of 

course, is true for savers, and MMMF portfolios are earning the lowest returns on 

investments since the funds were established more than 30 years ago (see Chart 1).1

In this environment, there has been some concern about MMMFs "breaking the buck," 

a situation in which the net asset value (NAV) of a MMMF falls below $1 per share. 

Breaking the buck can occur if some of the fund's investments experienced significant 

losses, or if the fund's investment income declined below operating expenses. 

D

Should the NAV of a MMMF break the buck, shareholders could lose money. Unlike 

bank deposits, MMMFs are not FDIC-insured. However, MMMFs are relatively low risk 

investments, and the expectation in the marketplace is that shareholders do not 

anticipate losing money. If their fund breaks the buck, shareholders would be expected 

to withdraw their money, unless the company sponsoring the fund provides financial 

support to prop up the NAV. 

A byproduct of the prolonged low rate environment could be increased risk taking by 

MMMF managers searching for higher yields. Higher risk investments tend to be more 

volatile and would decline in value more quickly in a scenario of sharp interest rate 

increases. Indeed, rapidly rising interest rates may be the more problematic scenario 

for MMMFs. There has only been one instance of a MMMF breaking the buck and 
liquidating; this was due to losses associated with high-risk structured note 

investments that were incurred when rates spiked up sharply in 1994.2 While this is the 

only MMMF that failed, there are several examples where sponsoring companies have 

sustained faltering MMMFs, primarily by buying or otherwise supporting troubled fund 

assets, sometimes expending hundreds of millions of dollars to do so.3 These 

companies viewed the perception of safety as an overarching factor as to why 

investors have placed, in aggregate, some $2 trillion in MMMFs. Therefore for them, 

the reputation risk of allowing a fund in their family to fail far outweighed the cost of 

support.

This report examines the effects of interest rate scenarios on MMMF yield and net 

asset value, discusses challenges facing MMMF managers in terms of asset selection, 

and addresses potential risks to FDIC-insured banks and their affiliates that sponsor 

MMMFs. Currently, banks and bank affiliates sponsor approximately 33 percent of all 

MMMF assets.4 Like other firms, banks and bank affiliates that sponsor MMMFs are 

experiencing low asset returns, diminished income from the need to reduce fees, and 

are subject to the general reputation risk associated with operating a MMMF. To alert 

banking organizations to potential risks and the legal framework for providing support 

to bank-advised funds, the FDIC and the other federal banking agencies released the 

Interagency Policy on Banks/Thrifts Providing Financial Support to Funds Advised by 

the Banking Organization or its Affiliates on January 6, 2004.5

What is a Money Market Mutual Fund?

A Money Market Mutual Fund (MMMF) is a type of mutual fund that invests 

shareholder contributions in low-risk and highly-liquid short term assets, such as 

Treasury bills, bank certificates of deposit, repurchase agreements, and commercial 

paper. As set forth in Rule 2a7 of the Investment Company Act of 1940, 95 percent 

of MMMF assets must be in the very highest rating categories, and the dollar 

weighted average maturity of the portfolio must be 90 days or less. Because of the 

high quality nature of investments, MMMFs are marketed to investors as a source of 

stable income. As such, these funds seek to maintain a net asset value of $1 per 

share.

MMMFs pay out earnings on investments to shareholders, after deducting operating 

expenses and fees. Most mutual fund families (including some sponsored by banks, 

bank affiliates, or bank holding companies) offer one or more MMMFs as short term 

investment options for their shareholders. However, some MMMFs are not part of a 

fund family. 

MMMFs are sometimes confused with money market deposit accounts (MMDAs). 

MMDAs are savings deposits that can be issued only by FDIC-insured banks and 

thrifts. Subject to FDIC coverage rules, deposits are insured up to $100,000. MMMFs 

are not FDIC-insured, and while it is extremely rare, investors can lose principal. 

Recent Trends in Money Market Mutual Fund Holdings

MMMFs represent 991 of the almost 8,200 mutual funds available as of November 

2003, and MMMF assets account for almost 30 percent all mutual fund assets, 

according to the Investment Company Institute's (ICI) monthly survey of the U.S. fund 

industry. ICI, a national association that tracks and disseminates data on the mutual 

fund industry, reports that total MMMF assets stood at $2.0 trillion as of April 21, 2004. 

This total is split about equally between assets of retail (funds offered primarily to 

individuals with moderate-sized accounts) and institutional (funds held primarily by 

businesses, governments, institutional investors and high net-worth households) 

MMMFs. 
About $230 billion has been withdrawn from MMMFs since year end 2002 when total 

assets stood at $2.32 trillion. This trend was driven, at least in part, by significant 

interest rate cuts that drove MMMF yields downward. Much of the outflow likely was 

absorbed by other short term, high quality investment vehicles, such as bond mutual 

funds and insured bank savings and money market accounts, although some of the 

outflows have been channeled into the stock market.

About 60 percent of MMMFs are sponsored by non-banking affiliated organizations, 

but banking organizations have been increasing offerings. As of March 2004, it is 

estimated that some 50 banking organizations sponsor 489 taxable MMMFs (up from 

437 at year-end 2002) with an outstanding balance of nearly $650.5 billion, or 33.1 

percent of all MMMF assets.6

MMMFs Have Been Affected By Persistently Low Rates, But This May Not Be the 

Worst Scenario

Media and analyst coverage of the effects of interest rates on MMMFs has focused 

almost exclusively on the potential for a "breaking the buck" scenario to develop 

because of low interest rates. Indeed, many funds are reporting very thin (and a few 

negative) margins even after the majority of funds have cut fees and expenses. 

As of mid-June 2003 (just prior to the Federal Reserve Board rate cut), iMoneyNet 

reported that 209 MMMFs were yielding 0.25 percent or less. In March 2004, this 

number had risen to 379 MMMFs. However, these funds tend to represent the highestexpense, "B" and "C" fund shares - a small 1.3 percent of total money market fund 

assets - that may have difficulty in further reducing expenses.7 An additional 359 funds 

were yielding between 0.25 and 0.50 percent in mid-June 2003.8 This rose to 555 by 

March 2004, which represented $387 billion in assets, or more than 19 percent of the 

total MMMF assets outstanding. 

The performance of the Japanese fund market, however, illustrates that prolonged 

periods of low short-term interest rates may not be the worst scenario for MMMFs. 

Short-term interest rates in Japan have been near zero percent for nearly four years. 

Nevertheless, "money-reserve funds," similar to U.S. money market funds, have not 

declined in value or experienced widespread failure.9 In reviewing the effects of 

prolonged low rates on MMMF assets, the critical inverse relationship between yield 

and price may have been overlooked. As short-term rates have fallen, the market 

value of MMMF holdings has generally increased. Therefore, because of this 

appreciation (albeit diminishing), the majority of MMMFs report a NAV that is still 

above $1. 

History Shows that MMMFs May Be More Susceptible to Rapid Spikes in Interest 

Rates

The yield/price relationship suggests that MMMFs also could be vulnerable should 

short-term interest rates spike upward. In this case, the market value of some MMMF 

investment holdings would be expected to decline, potentially driving the NAV below 

$1. A prior episode of MMMF stress occurred in 1994 when the Federal Reserve 

aggressively pushed up the Federal funds rate - by 125 basis points over a 60-day 

period - to ward off inflation (see Chart 1). 

In 1993 and early 1994, rates had been very low for over a year, and there was a 

belief that rates would stay low for some time. As a result, some managers with yields 

under pressure reached for higher returns by using riskier instruments, such as 

collateralized mortgage obligations and structured notes.10 For the most part, these 

instruments technically met the strict definitions of permissible investments for MMMFs 

because they were generally issued or guaranteed by government agencies. However, 
the performance of these instruments was much more volatile than traditional MMMF 

assets.

The only instance of a money market mutual fund breaking the buck occurred in 1994. 

The U.S. Government Money Market Fund was an institutional MMMF that was the 

only fund offered by the Community Bankers Mutual Fund Inc., in Denver, Colorado. 

Investors were primarily small community banks seeking a good rate on short term 

investments. The fund had invested 27.5 percent of its portfolio in adjustable rate 

derivative securities, otherwise known as structured notes. Beginning in March 1994, 

the value of the notes began to decline due to the sharp rise in interest rates, which 

caused the NAV to fall to 96 cents and resulted in liquidation of the fund in September 

of that year.11 The sponsor of the U.S. Government Money Market Fund did not have 

the wherewithal to support the NAV. However, during that time, several other sponsors 

that employed similar investment strategies provided support to their MMMFs to 

maintain the NAV above $1. 

There is Some Concern That History Will Repeat

As shown in Chart 1, the absolute level of interest rates is lower than in the 1993/1994 

period and rates have been low for a longer period of time. Given the sustained period 

of low interest rates and the resultant significant pressure on margins at the current 

time, concern exists that some MMMF managers, facing an inability to cut expenses, 

may take on additional risk by buying higher-risk, higher-yielding and less liquid 

assets. It is difficult to determine aggregate holdings of MMMFs, and there are strict 

limitations on MMMFs that serve as a backstop for investment quality. 

However, there are some qualifications to the investment limitations. For example, 

MMMFs may buy certain highly-rated derivatives and asset-backed securities. They 

also may keep assets that have been downgraded from the highest rating levels and 

may buy unrated assets, provided fund managers and board members determine that 

quality is comparable to rated securities. Moreover, even investing in traditional assets 

has become more challenging for MMMFs, as there is a limited supply of good quality 

short-term investments. 

Standard & Poor's (S&P) has raised concerns that large purchases of higher-yielding 

securities may undermine fund liquidity and the $1 NAV if MMMF managers go out too 

far on the risk curve. In late February 2003, S&P released a list of securities 

considered to possess "limited liquidity" and cautioned funds to hold not more than 10 

percent of assets in these securities.12 For example, credit-linked notes, a type of 

credit derivative, is on the list. Credit-linked notes are used by investors to take on the 

credit risk of a particular company without purchasing one of the company's bonds. 

However, because of the complex financial structures, these notes are more illiquid 

than traditional MMMF investments such as commercial paper or government debt 

securities and may be difficult to trade in the secondary market.13

Performance of Bank or Bank Affiliate-Sponsored MMMFs 

Currently, while about half of the number of all (taxable and nontaxable) banking 

organization-sponsored MMMFs report a yield less than 50 basis points, only 21.3 

percent of the dollar amount of all banking organization-sponsored MMMFs are 

yielding less than 50 basis points as of March 30, 2004 (see Chart 2). A majority of 

banking organization-sponsored funds also report an expense ratio that is below 50 

basis points (see Chart 3). 
D

D

Still, it appears that a fair number of banking organizations, like other MMMFsponsoring companies, have been required to cut costs and waive fees to maintain a 

stable NAV as spreads have narrowed. A comparison of the average expensesincurred ratio of 0.68 percent for taxable banking organization-sponsored funds for 
March 2004 to the average gross yield of 1.08 percent for the same period shows that 

most banking organization-sponsored funds have some room to lower yields. This 

spread (40 basis points) is higher than the spread for non banking organizationsponsored funds (34 basis points) as the average gross yield for non banking 

organization-sponsored funds is 1.09 percent and the average expenses-incurred ratio 

is 0.75 percent. 

Potential Risks to Banking Organizations from MMMFs

Although data are not available to quantify the effect of lower fees on banking 

organizations' bottom lines, fee waivers during the persistent low interest rate 

environment contribute to earnings risk in the form of reductions to other income. 

Additionally, should funds break the buck, the banking organization could be faced 

with liquidity risk, if it chooses to support the fund, and reputation and legal risk in 

either a support or liquidation scenario. Although banking organizations are not 

statutorily required to provide financial support to the funds they sponsor, they may 

decide to do so to minimize reputation risk that would arise in the event of liquidation 

or to limit liability. 

Examples of banks and their affiliates supporting their MMMFs occurred, again during 

1994 when interest rates rose rapidly. At that time, a mid-sized bank holding company 

garnered unfavorable media attention related to its MMMF. This banking organization 

managed, administered and distributed proprietary mutual funds and injected almost 

$4 million in cash into two proprietary MMMFs to cover losses from structured notes 

and other derivatives known as "cost of fund index floaters," when the market value of 

these instruments plunged along with a rapid spike in interest rates. 

The bank holding company sold these derivatives holdings to comply with an SEC 

directive issued June 30, 1994, that reiterated the agency's position on structured note 

holdings of MMMFs and asked money fund managers to make an "orderly disposal" of 

securities that the agency considers too risky for them to own.14 Also in 1994, a large 

banking organization made a $5 million cash infusion into three MMMFs to cover

derivatives-related losses on structured notes and subsequently sold the securities, 

also in response to the SEC directive.15

The FDIC and other banking regulators recently issued a Policy Statement to alert 

banking organizations to the safety and soundness and legal impediments to a bank 

providing financial support to funds. This Policy Statement indicates that bank 

management should consult with the appropriate federal agency before or immediately 

after (in the event of an emergency) providing support to funds; should have proper 

controls over such transactions; and should adopt policies governing support 

transactions. These policies should ensure that the bank will not

(1) inappropriately place its resources and reputation at risk for the benefit of the fund's 

investors and creditors;

(2) violate the limits and requirements contained in Sections 23A and 23 B of the 

Federal Reserve Act and Regulation W, other applicable legal requirements or any 

special supervisory condition imposed by the agencies; or 

(3) create an expectation that the bank will prop up the advised funds.

In addition to sponsoring MMMFs, some banking organizations hold MMMFs as an 

investment, traditionally as a way to earn a better return on funds invested for the short 

term. Like other MMMF investors, banking organizations that hold these investments 

are experiencing diminished returns on them. Credit risk can also become a factor for 
banking organizations should they hold MMMFs as an investment. In fact, the only 

MMMF that broke the buck, the U.S. Government Money Market Fund, was marketed 

to community banks, which lost $2.5 million in the aggregate, before recovering some 

of the losses in a legal suit.16 This example indicates that while it is extremely rare, 

investors can lose money with MMMFs, and if banks choose to invest in MMMFs, 

management should perform proper due diligence and monitor the funds' performance 

on an ongoing basis. 

Managing Uncertainty Going Forward

Of course, it is unclear what will happen with interest rates going forward, but fund 

managers need to be aware of and be able to react to various interest rate scenarios. 

Should short-term interest rates rise rapidly over the longer-term, fund managers must 

carefully monitor the effects on the relationship between pricing and yield, and balance 

these factors with risk tolerance levels. 

The marketplace perceives that it is unlikely any fund company with the requisite 

wherewithal would allow its MMMF to "break the buck." Rather, as has been the case 

in the past, sponsoring companies will likely continue to waive fees and cut expenses 

or will provide financial support to the fund, as a means of maintaining the notion of 

stability and thereby minimizing reputation risk. However, over the prolonged low 

interest rate cycle, these strategies are hurting the bottom line of fund sponsors in the 

form of reduced income.

Some money market mutual fund sponsors are looking at alternatives other than 

cutting fees, for example, combining multiple funds into one larger fund, to improve 

operating efficiency. Peter Crane, vice president and managing editor at iMoneyNet, 

suggests that fund managers are considering adding new fees, such as per check 

charges, although at this time, no firms have levied such charges. Fund managers 

could also shift the management of their funds to other asset management companies 

or partner with other firms that may be able to realize economies of scale due to larger 

operations.17

1 The Reserve Fund was the first money market mutual fund established in 1972. 

2 Mix, Diane. "Global Investing - Low Rates Yield a Sense of Déjà Vu," FT.Com, June 

24, 2002. 

3 For example, see Eaton, Leslie, "Paine Webber to Bail Out a Fund Battered by 

Complex Investments," The New York Times, July 23, 1994, and McGough, Robert, 

"Piper Jaffray Acts to Boost Battered Fund," The Wall Street Journal, May 23, 1994. 

4 The terms "bank organization-sponsored" and "bank and bank affiliate-sponsored" 

used in this report broadly refer to instances where a bank, its subsidiaries, a bank 

holding company, or its subsidiaries establish money market mutual funds. The terms 

"banking organization-advised" and "bank and bank-affiliate-advised" refer to 

situations where a bank, its subsidiaries, a bank holding company or its affiliates are 

the investment adviser of a fund and receive a fee for their investment advice. Very 

often, organizations that sponsor funds also advise them. 

5 This Policy Statement is available at 

http://www.fdic.gov/news/news/press/2004/pr0104a.html.

6 Data are provided by iMoneyNet. 

7 Generally B- and C-class fund shares charge at least 1 percent a year in expenses, 
leaving an extremely small margin for shareholders; the average expense ratio for 

money funds is about 0.57 percent of assets. B- and C- fund shares typically are sold 

through brokers or financial advisers who collect a commission from the fund. The 

fund company charges higher expense ratios to pay for these commissions. 

8 Pender, Kathleen. "New Rate Cut Perils Money Market Funds," San Francisco 

Chronicle, June 29, 2003 (as appeared on www.sunspot.com). 

9 Singer, Jason. "Japan's Zero Base Rate Offers Lessons to U.S. Fund Manager," The 

Wall Street Journal, June 27, 2003.

10 Mix, Diane. June 24, 2002. 

11 Securities and Exchange Commission. "Order Instituting Public Administrative and 

Cease-and-Desist Proceedings, Making Findings, and Imposing Remedial Sanctions 

and Cease-and-Desist Orders in the Matter of Craig S. Vanucci and Brian K. Andrew," 

File No. 3-9804, January 11, 1999.

12 Fine, Jacob. "Beware the Falling Yields: Money Markets Struggle to Maintain $1 

Value," The Bond Buyer, January 17, 2003. 

13 Wiggins, Jenny. "Agency Cautions U.S. Money Market Funds," Financial Times, 

February 23, 2003.

14 Crockett, Barton. "Wilmington Trust Unit Dumps Risky Holdings," The American 

Banker, July 11, 1994. The June 30, 1994, SEC letter followed a December 1993 SEC 

release that identified characteristics of securities that involve risks "inappropriate for a 

money market fund to assume."

15 Calian, Sara. "Fleet Financial Injects $5 Million in Three Funds - Money-Market 

Cash Infusion Averts 'Breaking Buck' on Derivatives Losses," The Wall Street Journal, 

August 22, 1994. 

16 Securities and Exchange Commission, January 11, 1999. 

17 Damato, Karen. "Trying to Outrun Low Interest Rates," The Wall Street Journal, July 

1, 2003.

About FYI

FYI is an electronic bulletin summarizing current information about the trends that are 

driving change in the banking industry, plus links to the wide array of other FDIC 

publications and data tools. 

Disclaimer

The views expressed in FYI are those of the authors and do not necessarily reflect 

official positions of the Federal Deposit Insurance Corporation. Some of the 

information used in the preparation of this publication was obtained from publicly 

available sources that are considered reliable. However, the use of this information 

does not constitute an endorsement of its accuracy by the Federal Deposit Insurance 

Corporation.

Last Updated 05/19/2004
Chart 1

Money Market Mutual Fund Yields Have Fallen to 

Record Low Levels as the Federal Reserve has 

Pushed Down the Federal Funds Rate 

Month/Year

Money 

Market 

Mutual 

Fund 

Net 

Average 

Yield

Federal 

Funds 

Rate

Jan-92 4.19 4.03 

Feb-92 3.86 4.06 

Mar-92 3.77 3.98 

Apr-92 3.68 3.73 

May-92 3.55 3.82 

Jun-92 3.48 3.76 

Jul-92 3.27 3.25 

Aug-92 3.09 3.3 

Sep-92 2.95 3.22 

Oct-92 2.82 3.1 

Nov-92 2.79 3.09 

Dec-92 2.87 2.92 

Jan-93 2.80 3.02 

Feb-93 2.72 3.03 

Mar-93 2.67 3.07 

Apr-93 2.64 2.96 

May-93 2.60 3.00 

Jun-93 2.63 3.04 

Jul-93 2.64 3.06 

Aug-93 2.65 3.03 

Sep-93 2.66 3.09 

Oct-93 2.65 2.99 

Nov-93 2.68 3.02 

Dec-93 2.71 2.96 

Jan-94 2.70 3.05 

Feb-94 2.76 3.25 
Mar

-94 2.87 3.34 

Apr-94 3.06 3.56 

May-94 3.37 4.01 

Jun-94 3.62 4.25 

Jul-94 3.78 4.26 

Aug-94 3.96 4.47 

Sep-94 4.17 4.73 

Oct-94 4.33 4.76 

Nov-94 4.64 5.29 

Dec-94 5.04 5.45 

Jan-95 5.19 5.53 

Feb-95 5.45 5.92 

Mar-95 5.52 5.98 

Apr-95 5.54 6.05 

May-95 5.52 6.01 

Jun-95 5.49 6.00 

Jul-95 5.37 5.85 

Aug-95 5.27 5.74 

Sep-95 5.25 5.80 

Oct-95 5.22 5.76 

Nov-95 5.23 5.80 

Dec-95 5.19 5.60 

Jan-96 5.05 5.56 

Feb-96 4.83 5.22 

Mar-96 4.76 5.31 

Apr-96 4.75 5.22 

May-96 4.74 5.24 

Jun-96 4.77 5.27 

Jul-96 4.81 5.40 

Aug-96 4.82 5.22 

Sep-96 4.83 5.30 

Oct-96 4.82 5.24 

Nov-96 4.84 5.31 

Dec-96 4.85 5.29
Jan

-97 4.84 5.25 

Feb-97 4.82 5.19 

Mar-97 4.84 5.39 

Apr-97 4.94 5.51 

May-97 4.98 5.50 

Jun-97 5.02 5.56 

Jul-97 5.02 5.52 

Aug-97 5.04 5.54 

Sep-97 5.02 5.54 

Oct-97 5.01 5.50 

Nov-97 5.05 5.52 

Dec-97 5.12 5.50 

Jan-98 5.10 5.56 

Feb-98 5.04 5.51 

Mar-98 5.03 5.49 

Apr-98 5.02 5.45 

May-98 5.00 5.49 

Jun-98 5.01 5.56 

Jul-98 5.01 5.54 

Aug-98 5.01 5.55 

Sep-98 4.98 5.51 

Oct-98 4.73 5.07 

Nov-98 4.61 4.83 

Dec-98 4.54 4.68 

Jan-99 4.46 4.63 

Feb-99 4.36 4.76 

Mar-99 4.35 4.81 

Apr-99 4.32 4.74 

May-99 4.29 4.74 

Jun-99 4.31 4.76 

Jul-99 4.45 4.99 

Aug-99 4.55 5.07 

Sep-99 4.69 5.22 

Oct-99 4.77 5.20 
Nov

-99 4.92 5.42 

Dec-99 5.06 5.30 

Jan-00 5.11 5.45 

Feb-00 5.22 5.73 

Mar-00 5.32 5.85 

Apr-00 5.46 6.02 

May-00 5.62 6.27 

Jun-00 5.87 6.53 

Jul-00 5.96 6.54 

Aug-00 5.99 6.50 

Sep-00 6.00 6.52 

Oct-00 5.99 6.51 

Nov-00 6.01 6.51 

Dec-00 5.98 6.40 

Jan-01 5.67 5.98 

Feb-01 5.20 5.49 

Mar-01 4.87 5.31 

Apr-01 4.47 4.80 

May-01 3.95 4.21 

Jun-01 3.63 3.97 

Jul-01 3.38 3.77 

Aug-01 3.21 3.65 

Sep-01 2.88 3.07 

Oct-01 2.34 2.49 

Nov-01 1.95 2.09 

Dec-01 1.66 1.82 

Jan-02 1.49 1.73 

Feb-02 1.41 1.74 

Mar-02 1.37 1.73 

Apr-02 1.37 1.75 

May-02 1.33 1.75 

Jun-02 1.32 1.75 

Jul-02 1.29 1.73 

Aug-02 1.26 1.74 
Sep-02 1.24 1.75 

Oct-02 1.22 1.75 

Nov-02 1.03 1.34 

Dec-02 0.90 1.24 

Jan-03 0.83 1.24 

Feb-03 0.78 1.26 

Mar-03 0.75 1.25 

Apr-03 0.72 1.26 

May-03 0.70 1.26 

Jun-03 0.65 1.22 

Jul-03 0.54 1.01 

Aug-03 0.52 1.03 

Sep-03 0.52 1.01 

Oct-03 0.52 1.01 

Nov-03 0.53 1.00 

Dec-03 0.53 0.98 

Jan-04 0.52 1.00 

Feb-04 0.52 1.01 

Mar-04 0.51 1.00 

Data points are monthly averages through March 

2004. Money market mutual fund average net yield 

is for taxable funds. The monthly net average yield 

for taxable money market mutual funds was 0.51% 

for March 2004. 

Source: iMoneyNet, Inc. and Federal Reserve/Haver 

Analytics
Chart 2

Half of Banking Organization-Sponsored Money 

Market Mutual Funds Yield Under 50 Basis 

Points

Money Market 

Mutual Fund 

Yield 

Number of 

Funds 

Amount of Funds 

($ Billions) 

Under .25% 115 $ 36 

.25% to .49% 234 $ 119 

.50% to .74% 214 $ 192 

.75% to .99% 140 $ 381 

1% and Over 1 $ 3 

Monthly average net yield and balances for banking 

organization-sponsored funds as of March 2004. 

The March monthly net yield for banking 

organization-sponsored funds is 0.50% and 0.47% 

for non-bank sponsored funds. 

Source: iMoneyNet, Inc. 
Chart 3

Most Banking Organization-Sponsored Money 

Market Mutual Funds Have Expense Ratios 

Under 50 Basis Points

Expense Ratio Number of 

Funds 

Amount of 

Funds ($ 

Billions) 

Under .25% 46 $ 204 

.25% to .49% 185 $ 270 

.50% to .74% 204 $ 134 

.75% to .99% 155 $ 91 

1% and Over 114 $ 32 

Monthly average net yield and balances for banking 

organization-sponsored funds as of March 2004. 

The March monthly average expense ratio for 

banking organization-sponsored funds is 0.68% and 

0.76% for non-bank sponsored funds.

Source: iMoneyNet, Inc. 
Map 1: Depopulation Is Most Prevalent in the Center of the Country

A map of the United States depicts the rate of depopulation across America from 1970 to 2000. Counties 

that added population over the 30-year span are called "growing counties" (total 2,362 or 75 percent); 

counties that lost population at a relatively constant rate are called "declining counties" (total 547 or 17 

percent); and counties that not only lost population but saw the rate of loss increase in the 1990s are 

called "accelerated declining counties" (total 232 or 8 percent). There are a total of 3,141 counties.

Source: US Census Bureau