The purpose of this notice is to inform you of changes we will be making to the current money market option we use for the cash balances associated with your account. In July 2014, the Securities and Exchange Commission approved new rules that alter certain features of U.S. money market funds. These changes include the possibility of the price per share fluctuating from its long-standing $1.00 per share value, having potential fees for redemption and the potential for not allowing redemptions under certain conditions. While these occurrences may not ever happen and/or be rare, we have continued to seek alternatives that avoid any of these potential factors for our clients.

As you know, we are currently using the Federated Government Obligations Premier Money Market fund for the short-term investing of cash that has been received or deposited into your account pending further investment or distribution. Effective July 1, 2018 we are switching to the Insured Cash Sweep, a Promontory InterFinancial Network product offered through First Bank. Features of this money market deposit account include:

  • FDIC insured for the full amount held in your account
  • Daily liquidity, with no penalty or fee for redemption
  • No potential for fluctuating principal due to adverse market conditions
  • A rate that will be at least equal if not better than the current Federated money market fund

We expect the initial rate to be slightly higher than the current yield on the Federated money market fund, but this rate will fluctuate over time depending on market conditions. Unless you tell us you do not want this option, there is nothing you need to do. This switch will automatically occur on July 1, 2018. We will also continue to monitor short term interest rates on the First Bank option relative to the market place to ensure that the rate of return remains very competitive with other short-term money market options.

We appreciate you as a First Bank wealth client and want to make sure you understand and are comfortable with this enhancement. If you have any questions, please contact your portfolio manager.