TD Ameritrade Holding Corp. said yesterday it would commit up to $50 million to “mitigate client losses” in a money market fund run by The Reserve Management Corp. of New York.
On Sept. 16, The Reserve froze its Reserve Primary Fund, saying the fund's net asset value was $0.97 due to exposure to commercial paper from Lehman Brothers Holdings Inc. of New York, which had filed for bankruptcy.
Jim Frawley, TD Ameritrade spokesman, said the $50 million would cover the 3 cent per share loss suffered by customers of TD Ameritrade of Omaha, Neb.
He added that customer access to the fund is “on hold for a few days.”
The Securities and Exchange Commission has allowed The Reserve to suspend all redemption requests in the Primary Fund and another money fund.
A statement on The Reserve's website says the suspension will last “until sufficient liquidity returns to the markets.”
“If we have a client with a liquidity issue, we're working with those people individually” to provide cash, Mr. Frawley said.
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