New guidelines for stress testing money market funds have been revealed by the EU’s financial regulator.
The European Securities and Markets Authority (ESMA) issued two sets of guidelines on stress testing and reporting on money market funds to national competent authorities (NCAs).
They are aimed at ensuring a coherent application of the Money Market Fund (MMF) Regulation.
Managers have a deadline to report by the end of the first quarter of next year.
Steven Maijoor, ESMA chair, said: “Due to their important role in the money market, any disruption affecting MMFs may impact financial stability. Stress testing is an important tool to assessing and mitigating potential stability risks.”
