Money Fund Regulatory Update & “Offshore” Money Fund Primer

1. Money Fund Regulatory Update & “Offshore” Money Fund Primer Oct. 2, 2013 Peter Crane President & PublisherCrane Data LLC Commercial Paper Issuer’s Working Group Bloomberg, New York, NY

2. Money Fund Regulatory Update & “Offshore” Money Fund Primer • Current State of Money Funds • Trends: Assets, Yields, Expenses, Holdings • MMF Reforms, Comments & Regulatory Outlook • Offshore (IMMFA) Money Fund Update • Global Money Fund Markets • Upcoming Calendar, News, Q&A

3. Current State of Money Funds • Regulatory Overhang: SEC Final Regs 2/14? • MMF Assets $2.7 Trillion (Record was $3.9T) • Bank Savings Almost $7.0 Trillion • Still 25 Million Shareholders • $4.3 Bil. in Annual Revenue? (down from $9B) • Approx. 1/4 Share of “Cash” Markets • Zero Yields, Attrition & Consolidation • Growth & Pressures Overseas

4. Money Fund Assets: History & Flows Money Funds Are Down Almost $1.0 Trillion Over 4 Yrs (-27%), But Still at mid-’07 Levels. 3 3 3

5. Banks (Still) Taking Trillions From MMFs Money Funds Are Down $1.0T (-29.6%) Over 4 Yrs.; MMDAs Are Up $2.4T (+53.2%)

6. Rock Bottom: Ultra-Low Rate Environment

7. Fund Expenses & Fee Waivers Money Fund Revenue Estimates: $2.5 Trillion x 0.16% = $4.0 Billion (7/13); $2.4 Trillion x 0.37% = $8.8 Bil. (7/07) 6

8. Money Fund Market Share (8/31/13)

9. Types & Number of Money Funds • Minor Consolidation • & Shrinking Universe • Prime MMFs Still King • Prime Inst 31% • Prime Retail 24% • Tax-Exempt 10% • Share classes vs. portfolios • Categorization issues

10. Taxable MMF Portfolio Composition 9

11. Supply, Commercial Paper & CD Update Money Fund Portfolio Composition • CDs Largest • Repo Volatile • Shrinking • Reg Pressure • Treasury & Agency Supply • CP Steady • Govt vs. Prime • VRDNs, T-E

12. MF Largest Portfolio Holdings & Country 11

13. Regulatory: SEC MMF Reform Proposal Timeline of Events • Rule 2a-7 Amendments (2/10) • President’s Working Grp (10/10) • SEC Cancels Vote (8/12) • FSOC Issues Draft (11/12) • SEC Reform Proposal (6/13) • Comment Letters Due (9/13) Predictions? Current Proposals • Final Rule Feb. 2014 • Floating NAV Dies, Gates • Letters to Date • Floating NAV (Prime Inst) or • Liquidity Fees/Gates (Prime) • 2a-7 Tweaks, Buffer Gone

14. SEC MMF Reform Comment Letters Fidelity: “The liquidity fees and redemption gates proposal is a more effective means to achieve the SEC’s goals than the floating NAV proposal. The SEC should adopt a fees and gates approach for institutional prime funds, with certain modifications.” J.P. Morgan A.M.: “JPMAM believes that in achieving the optimal balance of reducing systemic risk and preserving MMFs as an efficient and viable tool for investors and the financial markets, it is important to bear in mind that the reform of MMFs has been under discussion since the early days of the 2008 financial crisis.” Federated: “This is one of a series of letters from Federated Investors…. This letter addresses Federated’s comments regarding Alternative 2 of the Reform Proposal, which we regard as a more promising approach than any of the reform options previously included in the President’s Working Group on Financial Markets’ Report on Money Market Fund Reforms or in the recommendations considered by the Financial Stability Oversight Council.”

15. Worldwide & Intl MF Markets ($4.8T)

16. Offshore & European Money Funds • Dublin & Luxembourg • Approx. $670 Billion • USD, Euro, GBP • Market Share • Regs: EU Proposal, FSB, IMMFA

17. Emerging Money Fund Markets Recent Growth of the Largest Money Fund Markets Outside of the U.S. & Europe (ICI)

18. USD Portfolio Holdings

19. EUR Portfolio Holdings

20. GBP Portfolio Holdings

21. Money Fund News; Q&A

22. Contact Info