Fidelity Cash Reserves, JPMorgan Prime Money Market Fund, Vanguard Prime Money Market Fund and five other U.S. money-market funds cut holdings in French banks by 68 percent in November, reports Bloomberg.

The eight funds shifted investments to Swiss, Canadian, Swedish and Japanese banks as Europe continues to face a debt crisis. Bloomberg Risk reports that these U.S. money-market giants have reduced their French bank debt by $76.8 billion over the past 12 months, and that their French bank holdings recently dropped to $5.56 billion from $11.7 billion.

Because of the shift of investments by the U.S. prime money funds, the European Banking Authority said that French banks were forced to more than quadruple their borrowings from the European Central Bank in the last four months.

Money fund holdings in BNP Paribas (BNP) has dropped by 67 percent in November, amounting to $8.85 billion; Societe Generale debt holdings fell 89 percent or $2.37 billion; and Credit Agricole paper holdings lost 39 percent or $517 million.

The other five U.S. holdings that shifted investments were Fidelity Institutional Money Market Portfolio, BlackRock TempFund, Wells Fargo Advantage Heritage Money Markets Fund and Federated Prime Obligations Fund. 

Edited by: HFD


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