81 FR 95663 - Transamerica Funds, et al.; Notice of Application
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 249 (December 28, 2016)
Federal Register Volume 81, Issue 249 (December 28, 2016)
| Page Range | 95663-95664 | |
| FR Document | 2016-31290 |
[Federal Register Volume 81, Number 249 (Wednesday, December 28, 2016)] [Notices] [Pages 95663-95664] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-31290] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Investment Company Act Release No. 32400; File No. 812-14676] Transamerica Funds, et al.; Notice of Application December 21, 2016. AGENCY: Securities and Exchange Commission (``Commission''). ACTION: Notice of an application for an order pursuant to: (a) Section 6(c) of the Investment Company Act of 1940 (``Act'') granting an exemption from sections 18(f) and 21(b) of the Act; (b) section 12(d)(1)(J) of the Act granting an exemption from section 12(d)(1) of the Act; (c) sections 6(c) and 17(b) of the Act granting an exemption from sections 17(a)(1), 17(a)(2) and 17(a)(3) of the Act; and (d) section 17(d) of the Act and rule 17d-1 under the Act to permit certain joint arrangements and transactions. Applicants request an order that would permit certain registered open-end management investment companies to participate in a joint lending and borrowing facility. ----------------------------------------------------------------------- Applicants: Transamerica Funds and Transamerica Series Trust, each a Delaware statutory trust registered under the Act as an open-end management investment company with multiple series (each a ``Trust'' and collectively the ``Trusts''), and Transamerica Asset Management, Inc. (the ``Initial Adviser''), a Florida corporation registered as an investment adviser under the Investment Advisers Act of 1940. Filing Dates: The application was filed on July 20, 2016 and amended on October 26, 2016. Hearing or Notification of Hearing: An order granting the requested relief will be issued unless the Commission orders a hearing. Interested persons may request a hearing by writing to the Commission's Secretary and serving applicants with a copy of the request, personally or by mail. Hearing requests should be received by the Commission by 5:30 p.m. on January 16, 2017 and should be accompanied by proof of service on the applicants, in the form of an affidavit, or, for lawyers, a certificate of service. Pursuant to Rule 0-5 under the Act, hearing requests should state the nature of the writer's interest, any facts bearing upon the desirability of a hearing on the matter, the reason for the request, and the issues contested. Persons who wish to be notified of a hearing may request notification by writing to the Commission's Secretary. ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F Street, NE., Washington, DC, 20549-1090; Applicants: 1801 California Street, Suite 5200, Denver, Colorado 80202. FOR FURTHER INFORMATION CONTACT: Jill Ehrlich, Senior Counsel, at (202) 551-6819 or David J. Marcinkus, Branch Chief, at (202) 551-6821 (Division of Investment Management, Chief Counsel's Office). SUPPLEMENTARY INFORMATION: The following is a summary of the application. The complete application may be obtained via the Commission's Web site by searching for the file number, or an applicant using the Company name box, at http://www.sec.gov/search/search.htm or by calling (202) 551-8090. Summary of the Application: 1. Applicants request an order that would permit the applicants to participate in an interfund lending facility where each Fund could lend money directly to and borrow money directly from other Funds to cover unanticipated cash shortfalls, such as unanticipated redemptions or trade fails.\1\ The Funds will not borrow under the facility for leverage purposes and the loans' duration will be no more than 7 days.\2\ --------------------------------------------------------------------------- \1\ Applicants request that the order also apply to any existing or future series of the Trusts and to any other registered open-end management investment company or series thereof for which the Initial Adviser and each successor thereto or a person controlling, controlled by, or under common control with the Initial Adviser serves as investment adviser (each a ``Fund'' and collectively the ``Funds,'' and each such investment adviser an ``Adviser''). For purposes of the requested order, ``successor'' is limited to any entity that results from a reorganization into another jurisdiction or a change in the type of a business organization. \2\ Any Fund, however, will be able to call a loan on one business day's notice. --------------------------------------------------------------------------- 2. Applicants anticipate that the proposed facility would provide a borrowing Fund with significant savings at times when the cash position of the Fund is insufficient to meet temporary cash requirements. In addition, Funds making short-term cash loans directly to other Funds would earn interest at a rate higher than they otherwise could obtain from investing their cash in repurchase agreements or certain other short term money market instruments. Thus, applicants assert that the facility would benefit both borrowing and lending Funds. 3. Applicants agree that any order granting the requested relief will be subject to the terms and conditions stated in the Application. Among others, the Adviser, through a designated committee, would administer the facility as a disinterested fiduciary as part of its duties under the investment management agreements with the Funds and would receive no additional fee as compensation for its services in connection with the administration of the facility. The facility would be subject to oversight and certain approvals by the Funds' Board, including, among others, approval of the interest rate formula and of the method for allocating loans across Funds, as well as review of the process in place to evaluate the liquidity implications for the Funds. A Fund's aggregate outstanding interfund loans will not exceed 15% of its net assets, and the Fund's loans to any one Fund will not exceed 5% of the lending Fund's net assets.\3\ --------------------------------------------------------------------------- \3\ Under certain circumstances, a borrowing Fund will be required to pledge collateral to secure the loan. --------------------------------------------------------------------------- 4. Applicants assert that the facility does not raise the concerns underlying section 12(d)(1) of the Act given that the Funds are part of the same group of investment companies and there will be no duplicative costs or fees to the Funds.\4\ Applicants also assert that the proposed transactions do not raise the concerns underlying sections 17(a)(1), 17(a)(3), 17(d) and 21(b) of the Act as the Funds would not engage in lending transactions that unfairly benefit insiders or are detrimental to the Funds. Applicants state that the facility will offer both reduced borrowing costs and enhanced returns on loaned funds to all participating Funds and each Fund [[Page 95664]] would have an equal opportunity to borrow and lend on equal terms based on an interest rate formula that is objective and verifiable. With respect to the relief from section 17(a)(2) of the Act, applicants note that any collateral pledged to secure an interfund loan would be subject to the same conditions imposed by any other lender to a Fund that imposes conditions on the quality of or access to collateral for a borrowing (if the lender is another Fund) or the same or better conditions (in any other circumstance).\5\ --------------------------------------------------------------------------- \4\ Applicants state that the obligation to repay an interfund loan could be deemed to constitute a security for the purposes of sections 17(a)(1) and 12(d)(1) of the Act. \5\ Applicants state that any pledge of securities to secure an interfund loan could constitute a purchase of securities for purposes of section 17(a)(2) of the Act. --------------------------------------------------------------------------- 5. Applicants also believe that the limited relief from section 18(f)(1) of the Act that is necessary to implement the facility (because the lending Funds are not banks) is appropriate in light of the conditions and safeguards described in the application and because the Funds would remain subject to the requirement of section 18(f)(1) that all borrowings of a Fund, including combined interfund loans and bank borrowings, have at least 300% asset coverage. 6. Section 6(c) of the Act permits the Commission to exempt any persons or transactions from any provision of the Act if such exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act. Section 12(d)(1)(J) of the Act provides that the Commission may exempt any person, security, or transaction, or any class or classes of persons, securities, or transactions, from any provision of section 12(d)(1) if the exemption is consistent with the public interest and the protection of investors. Section 17(b) of the Act authorizes the Commission to grant an order permitting a transaction otherwise prohibited by section 17(a) if it finds that (a) the terms of the proposed transaction are fair and reasonable and do not involve overreaching on the part of any person concerned; (b) the proposed transaction is consistent with the policies of each registered investment company involved; and (c) the proposed transaction is consistent with the general purposes of the Act. Rule 17d-1(b) under the Act provides that in passing upon an application filed under the rule, the Commission will consider whether the participation of the registered investment company in a joint enterprise, joint arrangement or profit sharing plan on the basis proposed is consistent with the provisions, policies and purposes of the Act and the extent to which such participation is on a basis different from or less advantageous than that of the other participants. For the Commission, by the Division of Investment Management, under delegated authority. Robert W. Errett, Deputy Secretary. [FR Doc. 2016-31290 Filed 12-27-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 249 / Wednesday, December 28, 2016 / Notices 95663
Reference Room, 100 F Street NE., Filing Dates: The application was the loans’ duration will be no more than
Washington, DC 20549 on official filed on July 20, 2016 and amended on 7 days.2
business days between the hours of October 26, 2016. 2. Applicants anticipate that the
10:00 a.m. and 3:00 p.m. Copies of the Hearing or Notification of Hearing: An proposed facility would provide a
filing also will be available for order granting the requested relief will borrowing Fund with significant savings
inspection and copying at the principal be issued unless the Commission orders at times when the cash position of the
office of the Exchange. All comments a hearing. Interested persons may Fund is insufficient to meet temporary
received will be posted without change; request a hearing by writing to the cash requirements. In addition, Funds
the Commission does not edit personal Commission’s Secretary and serving making short-term cash loans directly to
identifying information from applicants with a copy of the request, other Funds would earn interest at a rate
submissions. You should submit only personally or by mail. Hearing requests higher than they otherwise could obtain
information that you wish to make should be received by the Commission from investing their cash in repurchase
available publicly. All submissions by 5:30 p.m. on January 16, 2017 and agreements or certain other short term
should refer to File Number SR–NYSE– should be accompanied by proof of money market instruments. Thus,
2016–85 and should be submitted on or service on the applicants, in the form of applicants assert that the facility would
before January 18,2017. an affidavit, or, for lawyers, a certificate benefit both borrowing and lending
For the Commission, by the Division of of service. Pursuant to Rule 0–5 under Funds.
Trading and Markets, pursuant to delegated the Act, hearing requests should state 3. Applicants agree that any order
authority.22 the nature of the writer’s interest, any granting the requested relief will be
Eduardo A. Aleman facts bearing upon the desirability of a subject to the terms and conditions
Assistant Secretary. hearing on the matter, the reason for the stated in the Application. Among
[FR Doc. 2016–31300 Filed 12–27–16; 8:45 am] request, and the issues contested. others, the Adviser, through a
Persons who wish to be notified of a designated committee, would
BILLING CODE 8011–01–P
hearing may request notification by administer the facility as a disinterested
writing to the Commission’s Secretary. fiduciary as part of its duties under the
SECURITIES AND EXCHANGE investment management agreements
ADDRESSES: Secretary, U.S. Securities
COMMISSION with the Funds and would receive no
and Exchange Commission, 100 F
additional fee as compensation for its
[Investment Company Act Release No. Street, NE., Washington, DC, 20549–
services in connection with the
32400; File No. 812–14676] 1090; Applicants: 1801 California Street,
administration of the facility. The
Suite 5200, Denver, Colorado 80202.
Transamerica Funds, et al.; Notice of facility would be subject to oversight
FOR FURTHER INFORMATION CONTACT: Jill and certain approvals by the Funds’
Application Ehrlich, Senior Counsel, at (202) 551– Board, including, among others,
December 21, 2016. 6819 or David J. Marcinkus, Branch approval of the interest rate formula and
AGENCY: Securities and Exchange Chief, at (202) 551–6821 (Division of of the method for allocating loans across
Commission (‘‘Commission’’). Investment Management, Chief Funds, as well as review of the process
ACTION: Notice of an application for an
Counsel’s Office). in place to evaluate the liquidity
order pursuant to: (a) Section 6(c) of the SUPPLEMENTARY INFORMATION: The implications for the Funds. A Fund’s
Investment Company Act of 1940 following is a summary of the aggregate outstanding interfund loans
(‘‘Act’’) granting an exemption from application. The complete application will not exceed 15% of its net assets,
sections 18(f) and 21(b) of the Act; (b) may be obtained via the Commission’s and the Fund’s loans to any one Fund
section 12(d)(1)(J) of the Act granting an Web site by searching for the file will not exceed 5% of the lending
exemption from section 12(d)(1) of the number, or an applicant using the Fund’s net assets.3
Act; (c) sections 6(c) and 17(b) of the Company name box, at http:// 4. Applicants assert that the facility
Act granting an exemption from sections www.sec.gov/search/search.htm or by does not raise the concerns underlying
17(a)(1), 17(a)(2) and 17(a)(3) of the Act; calling (202) 551–8090. section 12(d)(1) of the Act given that the
and (d) section 17(d) of the Act and rule Summary of the Application: Funds are part of the same group of
17d–1 under the Act to permit certain 1. Applicants request an order that investment companies and there will be
joint arrangements and transactions. would permit the applicants to no duplicative costs or fees to the
Applicants request an order that would participate in an interfund lending Funds.4 Applicants also assert that the
permit certain registered open-end facility where each Fund could lend proposed transactions do not raise the
management investment companies to money directly to and borrow money concerns underlying sections 17(a)(1),
participate in a joint lending and directly from other Funds to cover 17(a)(3), 17(d) and 21(b) of the Act as
borrowing facility. unanticipated cash shortfalls, such as the Funds would not engage in lending
unanticipated redemptions or trade transactions that unfairly benefit
Applicants: Transamerica Funds and fails.1 The Funds will not borrow under insiders or are detrimental to the Funds.
Transamerica Series Trust, each a the facility for leverage purposes and Applicants state that the facility will
Delaware statutory trust registered offer both reduced borrowing costs and
under the Act as an open-end 1 Applicants request that the order also apply to
enhanced returns on loaned funds to all
management investment company with any existing or future series of the Trusts and to any participating Funds and each Fund
multiple series (each a ‘‘Trust’’ and other registered open-end management investment
company or series thereof for which the Initial
sradovich on DSK3GMQ082PROD with NOTICES
collectively the ‘‘Trusts’’), and 2 Any Fund, however, will be able to call a loan
Adviser and each successor thereto or a person
Transamerica Asset Management, Inc. controlling, controlled by, or under common on one business day’s notice.
(the ‘‘Initial Adviser’’), a Florida control with the Initial Adviser serves as 3 Under certain circumstances, a borrowing Fund
corporation registered as an investment investment adviser (each a ‘‘Fund’’ and collectively will be required to pledge collateral to secure the
the ‘‘Funds,’’ and each such investment adviser an loan.
adviser under the Investment Advisers
‘‘Adviser’’). For purposes of the requested order, 4 Applicants state that the obligation to repay an
Act of 1940. ‘‘successor’’ is limited to any entity that results interfund loan could be deemed to constitute a
from a reorganization into another jurisdiction or a security for the purposes of sections 17(a)(1) and
22 17 CFR 200.30–3(a)(12). change in the type of a business organization. 12(d)(1) of the Act.
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![95664 Federal Register / Vol. 81, No. 249 / Wednesday, December 28, 2016 / Notices
would have an equal opportunity to provisions, policies and purposes of the notice required by Rule 19b–4(f)(6)(iii)
borrow and lend on equal terms based Act and the extent to which such under the Act.6
on an interest rate formula that is participation is on a basis different from The text of the proposed rule change
objective and verifiable. With respect to or less advantageous than that of the is available at the Exchange’s Web site
the relief from section 17(a)(2) of the other participants. at www.iextrading.com, at the principal
Act, applicants note that any collateral For the Commission, by the Division of office of the Exchange, and at the
pledged to secure an interfund loan Investment Management, under delegated Commission’s Public Reference Room.
would be subject to the same conditions authority. II. Self-Regulatory Organization’s
imposed by any other lender to a Fund Robert W. Errett, Statement of the Purpose of, and
that imposes conditions on the quality Deputy Secretary. Statutory Basis for, the Proposed Rule
of or access to collateral for a borrowing [FR Doc. 2016–31290 Filed 12–27–16; 8:45 am] Change
(if the lender is another Fund) or the BILLING CODE 8011–01–P
same or better conditions (in any other In its filing with the Commission, the
circumstance).5 self-regulatory organization included
5. Applicants also believe that the statements concerning the purpose of
SECURITIES AND EXCHANGE
limited relief from section 18(f)(1) of the and basis for the proposed rule change
COMMISSION and discussed any comments it received
Act that is necessary to implement the
facility (because the lending Funds are [Release No. 34–79652; File No. SR–IEX– on the proposed rule change. The text
2016–21] of these statement [sic] may be
not banks) is appropriate in light of the
conditions and safeguards described in examined at the places specified in Item
Self-Regulatory Organizations; IV below. The self-regulatory
the application and because the Funds Investors Exchange LLC; Notice of
would remain subject to the organization has prepared summaries,
Filing and Immediate Effectiveness of set forth in Sections A, B, and C below,
requirement of section 18(f)(1) that all Proposed Rule Change To Require
borrowings of a Fund, including of the most significant aspects of such
That an Issuer of Securities Listed statements.
combined interfund loans and bank Under Chapter 16 Notify IEX About
borrowings, have at least 300% asset Certain Changes to the Index, A. Self-Regulatory Organization’s
coverage. Portfolio, or Reference Asset Statement of the Purpose of, and
6. Section 6(c) of the Act permits the Underlying the Security Statutory Basis for, the Proposed Rule
Commission to exempt any persons or Change
transactions from any provision of the December 21, 2016.
Act if such exemption is necessary or Pursuant to Section 19(b)(1) 1 of the 1. Purpose
appropriate in the public interest and Securities Exchange Act of 1934 (the IEX listing rules require issuers to
consistent with the protection of ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notify IEX about substitution listing
investors and the purposes fairly notice is hereby given that, on December events. Specifically, Rule 14.002(a)(32)
intended by the policy and provisions of 15, 2016, the Investors Exchange LLC defines a ‘‘Substitution Listing Event’’ 7
the Act. Section 12(d)(1)(J) of the Act (‘‘IEX’’ or the ‘‘Exchange’’) filed with the as certain changes in the equity or legal
provides that the Commission may Securities and Exchange Commission structure of a company and Rule
exempt any person, security, or (the ‘‘Commission’’) the proposed rule 14.207(e)(4) requires a listed company
transaction, or any class or classes of change as described in Items I and II to provide notification to IEX about
persons, securities, or transactions, from below, which Items have been prepared these events no later than 15 days before
any provision of section 12(d)(1) if the by the self-regulatory organization. The implementation of the event. These
exemption is consistent with the public Commission is publishing this notice to events generally would require IEX to
interest and the protection of investors. solicit comments on the proposed rule review the entity for compliance with
Section 17(b) of the Act authorizes the change from interested persons. the applicable listing requirements.
Commission to grant an order IEX proposes to expand the definition
I. Self-Regulatory Organization’s of a Substitution Listing Event to
permitting a transaction otherwise
Statement of the Terms of Substance of include cases where an issuer of
prohibited by section 17(a) if it finds
the Proposed Rule Change securities listed under Chapter 16
that (a) the terms of the proposed
transaction are fair and reasonable and Pursuant to the provisions of Section replaces, or significantly modifies, the
do not involve overreaching on the part 19(b)(1) under the Securities Exchange index, portfolio, or reference asset
of any person concerned; (b) the Act of 1934 (‘‘Act’’),4 and Rule 19b–4 underlying its security (including, but
proposed transaction is consistent with thereunder,5 Investors Exchange LLC not limited to, a significant modification
the policies of each registered (‘‘IEX’’ or ‘‘Exchange’’) is filing with the to the index methodology, a change in
investment company involved; and (c) Securities and Exchange Commission the index provider, or a change in
the proposed transaction is consistent (‘‘Commission’’ or ‘‘SEC’’) proposed rule control of the index provider). This type
with the general purposes of the Act. changes to require that, among other of change would require IEX to review
Rule 17d–1(b) under the Act provides things, an issuer of an ETP listed under the changes to the index, portfolio, or
that in passing upon an application filed Chapter 16 notify IEX about certain
6 17 CFR 240.19b–4(f)(6)(iii).
under the rule, the Commission will changes to the index, portfolio, or
7A ‘‘Substitution Listing Event’’ means: A reverse
consider whether the participation of reference asset underlying the security.
stock split, re-incorporation or a change in the
the registered investment company in a The Exchange has designated this Company’s place of organization, the formation of
sradovich on DSK3GMQ082PROD with NOTICES
joint enterprise, joint arrangement or proposal as non-controversial and a holding company that replaces a listed Company,
profit sharing plan on the basis provided the Commission with the reclassification or exchange of a Company’s listed
shares for another security, the listing of a new class
proposed is consistent with the of securities in substitution for a previously-listed
1 15 U.S.C. 78s(b)(1).
2 15
class of securities or any technical change whereby
5 Applicants state that any pledge of securities to U.S.C. 78a. the Shareholders of the original Company receive
3 17 CFR 240.19b–4.
secure an interfund loan could constitute a a share-for-share interest in the new Company
4 15 U.S.C. 78s(b)(1).
purchase of securities for purposes of section without any change in their equity position or
17(a)(2) of the Act. 5 17 CFR 240.19b–4. rights.
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Document Created: 2016-12-28 02:16:43
Document Modified: 2016-12-28 02:16:43
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| Action | Notice of an application for an order pursuant to: (a) Section 6(c) of the Investment Company Act of 1940 (``Act'') granting an exemption from sections 18(f) and 21(b) of the Act; (b) section 12(d)(1)(J) of the Act granting an exemption from section 12(d)(1) of the Act; (c) sections 6(c) and 17(b) of the Act granting an exemption from sections 17(a)(1), 17(a)(2) and 17(a)(3) of the Act; and (d) section 17(d) of the Act and rule 17d-1 under the Act to permit certain joint arrangements and transactions. Applicants request an order that would permit certain registered open-end management investment companies to participate in a joint lending and borrowing facility. | |
| Dates | The application was filed on July 20, 2016 and amended on October 26, 2016. | |
| Contact | Jill Ehrlich, Senior Counsel, at (202) 551-6819 or David J. Marcinkus, Branch Chief, at (202) 551-6821 (Division of Investment Management, Chief Counsel's Office). | |
| FR Citation | 81 FR 95663 |
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