You can now read 5 articles in a month for free on Read as much as you want anywhere and anytime for just 99¢.

Around the Region

Fidelity opposes ‘shadow’ term

Fidelity Investments urged European regulators to abandon the term “shadow banking” and said that its money market mutual funds should not be considered part of the so-called shadow banking system.

In a comment letter to the European Commission dated Friday, the Boston investment giant said that some of the entities being labeled as shadow banks are “neither in the shadows, nor banks, nor even bank-like.” The firm went on to say that money markets are “significantly more transparent than banks, and, therefore, hardly in the ‘shadows.’”

Continue reading below

Fidelity has been speaking out on money market regulation in the United States and overseas, as regulators look to bolster oversight of large pools of money to prevent another global financial crisis. Fidelity is the one of the world’s largest managers of money market funds, and the biggest in the United States, with $415 billion in assets.

The European Commission’s Green Paper, on which Fidelity was commenting, suggests that money markets, mutual funds that use leverage, and insurance companies that guarantee credit products all are being analyzed as possibly part of the shadow banking system. Fidelity called the term “confusing and misleading.”

Beth Healy can be reached at
Loading comments...

Wake up with today's top stories.

Want each day's news headlines delivered fresh to your
inbox every morning? Just connect with us
in one of the following ways:
Please enter a valid email will never post anything without asking.
Privacy Policy
Subscriber Log In

You have reached the limit of 5 free articles in a month

Stay informed with unlimited access to Boston’s trusted news source.

  • High-quality journalism from the region’s largest newsroom
  • Convenient access across all of your devices
  • Today’s Headlines daily newsletter
  • Subscriber-only access to exclusive offers, events, contests, eBooks, and more
  • Less than 25¢ a week
Marketing image of
Marketing image of