Psagot Investment House Ltd. today announced that, beginning on February 1, it will charge a 0.125% management fee on its money market funds. This is the same amount as the distribution fee. The announcement comes after the company absorbed tens of millions of shekels of uncharged management fees over 18 months.
Psagot's money market fees have NIS 11.8 billion in assets under management, amounting to 43% of its total assets under management. Last July, the company announced that it would begin charging a 0.125% management fee on its money market funds, but retracted the announcement a day later and resumed its zero-fee policy. Prisma Investment House Ltd. and Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) made similar announcements at the same time; while Harel also retreated, Prisma did not.
Psagot is the largest manager of mutual funds and money market funds. In the wake of today's announcement, other large money market fund managers are expected to follow suit, especially Harel and DS Securities & Investments Ltd. (TASE:DSIN).
The 0.125% management fee is unlikely to be the final word on the subject. Money market fund managers will probably raise the fee back to its original level of 0.3-0.4%.
Published by Globes [online], Israel business news - www.globes-online.com - on January 26, 2009
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