The MMIFF has not yet been used by money market funds.
While money market funds can sell instruments into the MMIFF, they receive only 90 percent of their value, with the additional 10 percent made up of asset-backed commercial paper issued by the MMIFF to the participating money market fund.
The MMIFF has 5 SPVs, each allowed to purchase instruments issued by 10 designated financial institutions.
will lend to private sector SPVs that invest in commercial paper issued by highly rated financial institutions.
The AMLF and the MMIFF
backstop the purchase of short-term debt instruments, thereby creating additional liquidity in the markets for them, the CPFF provides for the issuance of CP to the Federal Reserve Bank of New York through its primary dealers, and Straight-A fosters FFELP lending by purchasing notes backed by FFELP loans and funding the purchase through the issuance of ABCP.
As detailed in the report, Fitch expects to assign an 'F1' rating to each of five ABCP programs that have been created in conjunction with the MMIFF
Second, the CPFF backstopped issuance of both unsecured and secured commercial paper, while the AMLF funded only ABCP and the MMIFF special-purpose vehicles purchased only certificates of deposit, bank notes, and commercial paper from specific financial institutions.
While the MMIFF was a liquidity facility for money market mutual funds in the case of abrupt withdrawals by investors, the CPFF effectively bypassed the money market universe by allowing issuers to issue directly into it.
For example, several of the new facilities introduced by the Federal Reserve in the current crisis are available at the discretion of market participants (the PDCF, AMLF, CPFF, MMIFF, and TALF), while others appear to have been structured to encourage market intermediation of credit.
The PDCF is the Primary Dealer Credit Facility; the AMLF is the Asset-Backed Commercial Paper Money Market Fund Liquidity Facility; the CPFF is the Commercial Paper Funding Facility; the MMIFF is the Money Market Investor Funding Facility.