Dow Jones writes "Europe Banks Can Cope With US Money Market Fund Pullback-Fitch". It says, "European banks in France, Germany, the U.K. and northern Europe have little to worry about from an ongoing pullback in funding from U.S. money market funds, analysts at Fitch Ratings said Tuesday, as investors continued to be concerned about the availability of bank funding in volatile markets. Fitch European banks analyst Bridget Gandy told a conference call that even a total withdrawal of U.S. money market funds would only be "inconvenient," since the reliance on these kinds of funds is relatively small for most large European banks. She said the banks themselves have been choosing to find funding elsewhere in the past few months, particularly as the opportunity to raise cheap dollar-denominated money market funds and use it to earn interest on deposit with the U.S. Federal Reserve has receded. Fitch on Monday published a report highlighting how U.S. money market funds have cut their exposure to Italian and Spanish banks to virtually zero, while also sharply reducing their holdings in French and German bank debt since May. Debt maturities are also shortening, as U.S. money market funds become less willing to take any Europe-related risk and aim to have more liquid assets on hand to meet redemption requests by their own investors." In other news, Bloomberg writes the oddly titled, "Fed Made State Street Profitable as Middleman".
