OREANDA-NEWS. Fitch Ratings has assigned Amundi 3M a Fund Credit Quality of 'A' and a Volatility Rating of 'V1'. The fund is a managed by Amundi Group (Amundi, A+/Stable/F1).

KEY RATING DRIVERS
The main drivers for the Fund Credit Quality Rating are:
-- The average credit quality of the fund's portfolio of assets as measured by its weighted average rating factor (WARF)
-- The distribution of asset ratings and investment guidelines limiting the minimum rating to BBB- (or equivalent).
-- Portfolio diversification

The main drivers for the Fund Volatility Rating are:
-- The fund's low exposure to interest rates with duration maintained below four months
-- Contained spread duration exposure

Asset Credit Quality
The fund's weighted average credit quality is high. The WARF was 0.90 at end-June 2015, a level typically associated with a 'AA' standard. However, Fitch has assigned a 'A' Fund Credit Quality Rating to the fund to reflect the flexibility the fund has, under its investment guidelines, to increase its allocation to lower quality and/or longer-dated securities. Fitch understands from the fund that the allocation to such securities may increase, which, all else being equal would result in a greater WARF, more consistent with a Fund Credit Quality Rating in the 'A' category. The fund invests in a diversified portfolio of assets, typically comprising certificates of deposit, commercial paper, time deposits, fixed- and floating-rate corporate bonds.

The fund was invested in 58 issuers, of which 71% were rated in the 'A' category and the minimum credit quality of assets was 'BBB-' (less than 1%) as of end-June 2015.

The top five issuer exposures comprised 30% (of which 7% of overnight maturing cash position left at the fund' custodian, Caceis) of the portfolio as of end-June 2015. Under the fund's investment guidelines, concentration per issuer or counterparty is limited to no more than 10% of the fund's net assets (5% for the 'BBB' rated categories), unless the exposure is to overnight deposits, which may account for up to 20%.

Portfolio Sensitivities to Market Risks
The fund has low exposure to interest rate and spread risks. Interest rate risk is managed within a maximum duration of six months and is typically maintained below four months. At end-June, the fund had a weighted average maturity (WAM) of 52 days and weighted average life (WAL, which measures sensitivity to spread risk) of 242 days with 74% of total assets maturing within one year. This resulted in a market risk factor well within the 'V1' Fund Volatility Rating range.

Maturity of investments is limited to 397 days and two years for fixed-rate and floating-rate instruments, respectively. The fund does not use leverage. It may invest in non-euros denominated securities (for up to 30%), in which case currency exposure is fully hedged through currency swaps.

Fund Profile
Amundi 3M is a French-domiciled money market fund pursuant to the UCITS regulation. As of end-June 2015, the fund's total assets stood at EUR14.2bn. Its investor base is well-diversified.

The Advisor
Amundi, the fund's investment advisor, is 80% owned by Credit Agricole (A/Positive/F1) and 20% Societe Generale (A/Stable/F1). With EUR954.2bn of assets under management at end- March 2015, Amundi is the largest asset manager in Europe. At the same date, it had EUR162bn of assets in money market funds. Fitch views Amundi's and Credit Agricole's investment advisory capabilities, financial and resource commitments, operational controls, corporate governance, and compliance procedures as consistent with 'A'/'V1' ratings.

RATING SENSITIVITIES
The ratings may be sensitive to material changes in the fund's credit quality or market risk profile. A material adverse deviation from Fitch guidelines for any key rating driver could cause Fitch to downgrade the ratings.

For example, credit deterioration leading to increases in the WARF beyond levels compatible with a 'A' Fund Credit Quality Rating may result in a downgrade. A large increase in allocation to long-dated 'BBB' and/or 'BBB-' assets would have a rating impact, despite headroom afforded by the currently low WARF of the fund. Potential downgrades to the Fund Volatility Rating are limited in scope, given the fund's low sensitivity to interest rate and spread risks, and the fund's investment guidelines.

To maintain the fund's ratings, Fitch receives monthly fund and portfolio holdings information from the fund's administrator, Caceis Bank (France), and conducts surveillance checks against its ratings criteria.