(Ecofin Agency) - South African banking group Absa Bank announced it will shut down its investment vehicle Absa Money Market Fund (AMMF) in July this year. The company says many of its investors and clients have a wrong idea about the fund’s management and structuring.
“We have therefore decided to close the [fund] as of 6 July 2021 (the closure date), in the best interest of our clients, and given our findings that the majority of retail clients believe that their capital and returns are guaranteed,” the company said in a letter to investors.
Absa has given 90 days, from the date of publication of the document announcing the closure of the AMMF to customers to withdraw their funds and, if they wish, transfer them to another financial product of the Bank. As a replacement, another fund called Absa Prudential Money Market Fund is announced with the particularity of "an improved investment policy."
An official document showed that the return generated by the AMMF has gradually declined from 7.56% in April 2019 to 3.85% in February 2021.