MOODY'S INVESTORS SERVICE ASSIGNS Aaa MONEY MARKET FUND RATINGS TO FEDERATED SHORT-TERM U.S. PRIME FUND AND SHORT-TERM U.S. TREASURY FUND
New York, 07-25-96 -- Moody's Investors Service assigned Aaa money market fund ratings to Federated Short-Term U.S. Prime Fund and Federated Short-Term U.S. Treasury Fund. These are money market fund classes that form part of Federated International Funds Plc, an umbrella fund that is authorized by the Central Bank of Ireland and is qualified as Undertakings for Collective Investment in Transferable Securities (UCITS). The funds invest in high-quality U.S. dollar-denominated short-term debt instruments that are not subject to U.S. withholding taxes on distribution to non-U.S. persons. These funds are managed in accordance with SEC Rule 2a-7, and they endeavor to maintain a stable net asset value of US$1.00 per share. The funds are managed by Federated International Management Limited of Dublin, Ireland, an indirect subsidiary of Federated Investors. They are designed for institutional investors, including banks, corporations, and fiduciaries.
Moody's said that the Aaa ratings reflect the funds' high-quality investments. The Short-Term U.S. Treasury Fund invests in U.S. Treasuries and repurchase agreements that are collateralized by U.S. Treasury securities. The U.S. Prime Fund invests in the following: Eurodollar and Yankee Certificates of Deposit; commercial paper issued by domestic and foreign banks, corporations, and other borrowers; U.S. Government obligations, both fixed and variable; asset-backed securities; variable rate notes; and repurchase agreements. These highly rated instruments are reviewed and monitored by Federated on an ongoing basis. The ratings also reflect Federated's conservative management style, with its emphasis on safety and liquidity, according to Moody's. Shareholders and invested balances are somewhat concentrated, but the rating agency believes that the funds maintain adequate levels of overnight liquidity and are otherwise structured effectively, with laddered maturities around core assets. In addition, the funds will maintain an average weighted maturity of 60 days or less. As of June 15, 1996, the average weighted maturities for U.S. Treasury Fund and U.S. Prime Fund were 13 days and 25 days, respectively.
In addition to an effective regulatory-compliance program, the funds' operations activities are well organized and controlled.
The funds are regulated and licensed under Section 18 of the Irish Finance Act of 1989. Their portfolios of securities are held by The Bank of New York, which acts as a sub-custodian pursuant to an agreement with Allied Irish Bank--the custodian for both funds. Orders for the purchase and redemption of fund shares are directed to BNY Fund Management (Ireland) Limited, and payments are routed to The Bank of New York in New York, N.Y.
Federated Investors--located in Pittsburgh, Pennsylvania--along with its various subsidiaries, manages, or administers total assets of approximately $85 billion.
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