Nervousness about counterparty risk has prompted Threadneedle to begin placing cash on deposit with various banks overnight for its Crescendo range of funds.

The asset manager said that where deposits are in excess of 20 per cent of the funds’ gross assets and not already allocated with brokers or custodians, it will place the cash on deposit at banks.

The banks involved will have financial resources in excess of EUR 200 million and have a minimum credit rating of A2 for long term debt from Moody’s or an A rating from Standard & Poors.

Threadneedle said that, in view of current market conditions, the funds would minimise counterparty risk by placing the funds’ cash on deposit.

The directors of the fund said that this would be ‘in the best interests of shareholders’.

Five funds are affected in total:

- Threadneedle American Crescendo Fund
- Threadneedle European Crescendo Fund
- Threadneedle European Smaller Companies Crescendo Fund
- Threadneedle Global Crescendo Fund
- Threadneedle UK Crescendo Fund

This latest news follows an announcement last week that the asset manager had expanded its UK Equity High Alpha team with the appointment of Chris Kinder (read here).