NOTICE TYPE:
M-A092408-04 General
SHORT DESCRIPTION:
ERCOT Receives Additional Distribution of Funds from The Reserve
INTENDED AUDIENCE: All
ERCOT Market Participants
DAY AFFECTED: November
13, 2008
LONG DESCRIPTION: The Electric Reliability Council of
Texas, Inc. (ERCOT), today received $61.5 million from The Reserve’s US
Government Fund.
The Reserve’s first distribution from the US
Government fund was made pro rata to all investors at approximately 40 percent
of their current account balance. The Reserve said
today they will make additional distributions as more cash becomes
available.
ERCOT expects a full recovery of the remaining $86.4
million in the US Government Fund and $23.5 million in The Reserve’s
Primary Fund. ERCOT received an initial distribution of $24.3 million
from The Reserve’s Primary Fund on October 31.
ADDITIONAL INFORMATION: ERCOT
has maintained funds in money market mutual funds controlled by The Reserve,
including the Primary Fund and the U.S. Government Fund. On Monday,
September 15, 2008, the day after the bankruptcy of Lehman Brothers Holdings,
Inc., it became known that approximately 1.2% of the Primary Fund assets were
Lehman securities, which triggered a high level of redemption request for The
Reserve’s funds. On September 16, 2008, ERCOT delivered a letter
requesting that The Reserve immediately close all of its investment accounts
with The Reserve; and ERCOT has received confirmation of this redemption order
from The Reserve.
Based
on the information known at this time, ERCOT expects a full recovery of all of
its and its members’ funds invested in The Reserve’s funds due to
the priority of its redemption request; however, the timing of full recovery is
still unknown.
CONTACT: If you have
any questions, please contact your ERCOT Account Manager. You may also call the
general ERCOT Client Services phone number at (512) 248-3900 or contact ERCOT
Client Services via e-mail at [log in to unmask].
If you are receiving e-mail from an ERCOT distribution
list that you no longer wish to receive, please follow this link in order to
unsubscribe from this list: http://lists.ercot.com.
sg