Sept. 7 (Bloomberg) -- SMBC Nikko Securities Inc., the investment banking unit of Sumitomo Mitsui Financial Group Inc., said it will close its euro-denominated money market fund as interest rates hold at record lows in Europe.
Shareholders have until Dec. 6 to redeem their investment in the fund, which opened in 1996, SMBC Nikko said in a statement without providing details. The Tokyo-based firm is closing the fund because of pressure on short-term euro financial markets.
The European Central Bank lowered its benchmark rates to record lows in July and hasn’t ruled out further cuts amid slowing euro-region economic growth.
SMBC Nikko’s withdrawal follows Daiwa Europe Fund Managers Ireland Ltd.’s Sept. 3 announcement to permanently close its euro fund by the end of October “due to continuing low interest rates.”
SMBC Nikko’s euro fund has about 27.7 billion yen ($355 million) of assets under management, while Daiwa’s fund holdings total about 16.7 billion yen, Reuters reported earlier today.
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