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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM N-CSR
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CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-3807
SunAmerica Money Market Funds, Inc.
----------------------------------------------------
(Exact name of registrant as specified in charter)
Harborside 5, 185 Hudson Street, Suite 3300 Jersey City, NJ 07311
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(Address of principal executive offices) (Zip code)
John T. Genoy
Senior Vice President
SunAmerica Asset Management, LLC
Harborside 5, 185 Hudson Street,
Suite 3300
Jersey City, NJ 07311
-----------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (201) 324-6414
Date of fiscal year end: December 31
Date of reporting period: December 31, 2016
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Item 1. Reports to Stockholders
[PHOTO]
ANNUAL REPORT 2016
SUNAMERICA
Government Money Market Fund
[LOGO]
TABLE OF CONTENTS
SHAREHOLDERS' LETTER.................................... 2
EXPENSE EXAMPLE......................................... 5
STATEMENT OF ASSETS AND LIABILITIES..................... 7
STATEMENT OF OPERATIONS................................. 8
STATEMENT OF CHANGES IN NET ASSETS...................... 9
FINANCIAL HIGHLIGHTS.................................... 10
PORTFOLIO OF INVESTMENTS................................ 11
NOTES TO FINANCIAL STATEMENTS........................... 13
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. 19
DIRECTORS AND OFFICERS INFORMATION...................... 20
SHAREHOLDER TAX INFORMATION............................. 23
December 31, 2016 ANNUAL REPORT
Shareholders' Letter -- (unaudited)
Dear Shareholders,
We are pleased to present this annual shareholder report for the SunAmerica
Government Money Market Fund (the "Fund") for the 12 months ended December 31,
2016.
Effective April 29, 2016, the Fund, formerly the SunAmerica Money Market Fund,
converted from a prime money market fund to a government money market fund and
changed its name accordingly to the SunAmerica Government Money Market Fund. To
qualify as a government money market fund, the Fund must invest at least 99.5%
of its total assets in cash, U.S. government securities, and/or repurchase
agreements that are collateralized by cash and/or U.S. government securities.
Thus, during the first months of the annual period, the Fund gradually was
repositioned, allocating a larger percentage of its assets to U.S. government
securities before reaching its new allocation on April 29, 2016. As a
government money market fund, the Fund seeks to maintain a stable $1.00 net
asset value per share and is not subject to liquidity fees and/or redemption
gates.
The annual period ended December 31, 2016 was one wherein money market yields
remained low throughout. The Federal Reserve (the "Fed"), after making its
first rate hike since 2006 in December 2015, kept interest rates steady until
December 2016, when it raised the targeted federal funds rate by 0.25%.
Fed statements and policies were the primary focus of money market funds
throughout the annual period. In March 2016, the Fed appeared surprisingly
dovish as it indicated an even slower tightening path, paring back its
forecasts for interest rate increases in 2016 from the four projected in
December 2015 to two. The Fed cited global uncertainties and mentioned that
inflation remained lower than it would like. (Dovish language tends to suggest
lower interest rates; opposite of hawkish.) In April 2016, the Fed left rates
on hold as expected, citing a slowdown in U.S. economic growth. In May 2016,
the Fed signaled an increasing probability of a June 2016 interest rate hike,
and short-term yields increased as a result. As oil prices rose, there were
signs that inflation may have been picking up, supporting the more hawkish
rhetoric from the Fed. In June 2016, Britain's decision to leave the European
Union led to a spike in global financial market volatility and a flight to
relative safety. The Fed reverted to its more dovish stance, reducing its
long-term forecasts for growth and policy rates, citing mixed U.S. economic
data and uncertainty about global economic and financial developments. During
the summer of 2016, markets remained skeptical about the Fed's ability to raise
interest rates in the near term, despite more hawkish rhetoric from some Fed
members. The Fed's decision to leave rates unchanged at its September 2016
meeting was a close call, which was underscored by a post-meeting statement
saying that near-term risks to the economy were "roughly balanced" and that
three dissenters had wanted to increase rates. Fed Chair Janet Yellen indicated
that the case to raise rates had strengthened, but not enough to warrant a
move. Overall, policymakers signaled a higher probability of a rate increase
before the end of 2016, with fewer hikes expected in coming years given the
diminished projections for long-term U.S. economic growth.
The U.S. Treasury money market yield curve, or spectrum of maturities,
steepened substantially on the heels of the post-U.S. election sell-off, as the
market began pricing in higher inflation as a result of greater anticipated
fiscal spending. Information received since the Fed met in November 2016
indicated the labor market continued to strengthen and economic activity was
expanding at a moderate pace since mid-year. Job gains had been solid, and the
unemployment rate had declined. Household spending had been rising moderately,
but business fixed investment had remained soft. Inflation increased since
earlier in 2016 but was still below the Fed's 2% longer-term objective, partly
reflecting earlier declines in energy prices and in prices of non-energy
imports.
In view of realized and expected labor market conditions and inflation, the Fed
gave the U.S. economy a vote of confidence by deciding to raise its targeted
federal funds rate to a range of 0.50%-0.75% at its mid-December 2016 meeting,
though the stance of monetary policy remained accommodative. The Fed's decision
was a well-telegraphed one and only the second
2
December 31, 2016 ANNUAL REPORT
Shareholders' Letter -- (unaudited) (continued)
interest rate hike in the last decade. While market participants had largely
priced in a Fed rate hike, the statement and press conference following the
meeting were more hawkish than expected, particularly the shift in view toward
three rate hikes in 2017 versus the two previously expected. Toward the very
end of the annual period, there was a flattening of the U.S. Treasury money
market yield curve.
With the targeted federal funds rate within a range of 0.25%-0.50% through most
of the Fund's annual period, money market yields remained anchored near the
same level with little difference in maturities. That said, money market yields
overall did move modestly higher toward the end of 2016, mainly driven by the
interest rate hike by the Fed in December 2016 and expectations for further
rate hikes in 2017 given improvement in the labor market, rising wages and
potential fiscal policy initiatives following Donald Trump's victory in the
November 2016 U.S. presidential election. Despite movement otherwise in the
last months of the calendar year, the money market yield curve flattened during
the annual period overall, as short-term rates rose more than longer-term rates
did. Still, the annual period did not provide many opportunities to add yield.
On the following pages, you will find a brief discussion of the annual period
from the portfolio manager as well as detailed financial statements and
portfolio information for the Fund for the annual period ended December 31,
2016.
As always, we remain diligent in the management of your assets. We value your
ongoing confidence in us and look forward to serving your investment needs in
the future. If you have any questions, or require additional information on
this or other SunAmerica Mutual Funds, you may contact your financial advisor
or visit us at www.safunds.com.
Sincerely,
/s/ Peter A. Harbeck
Peter A. Harbeck
President & CEO
SunAmerica Asset Management, LLC
--------
Past performance is no guarantee of future results.
An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation (FDIC) or any other government agency. Although the Fund
seeks to preserve the value of your investment at $1.00 per share, it is
possible to lose money by investing in the Fund.
3
SunAmerica Government Money Market Fund
Andrew Doulos, Portfolio Manager
SunAmerica Asset Management, LLC
The SunAmerica Government Money Market Fund (Class A) returned 0.01% for the
annual period ended December 31, 2016.
Fund performance was affected most by historically low interest rates that
persisted throughout 2016. Yields on money market securities moved up and down
within a rather tight range for most of the annual period, before rising
modestly toward the end of 2016 with the Federal Reserve's (the "Fed") interest
rate hike in mid-December 2016. One-month certificates of deposit (CDs) yielded
approximately 0.98% at year-end 2016 compared to roughly 0.56% at year-end 2015
but averaged 0.52% for the annual period as a whole./1/
While money market yields were low throughout the annual period, the Fund
continued to seek current income to the extent consistent with liquidity and
stability of principal. We were able to navigate interest rate risk by
adjusting the Fund's weighted average maturity/2/ as market conditions shifted.
We were able to mitigate potential credit risk by buying high quality,
creditworthy names. Indeed, in converting to a government money market fund in
April 2016, we bought mostly U.S. Treasuries and U.S. agency securities.
More specifically, given the anticipated increase in interest rates that
dominated investor sentiment, especially during the second half of the year, we
shifted the Fund's positioning during the annual period. At the end of 2015, we
had employed a laddered approach, meaning holding securities of different
maturity dates rather evenly spaced across the money market yield curve. Early
in 2016, we transitioned to a barbell investment strategy, with greater
weightings in fixed-rate securities at the short-term end of the yield curve
and in longer-dated floating-rate securities. This strategy enabled us to both
ensure a cushion of liquidity in the near term, and to reinvest into higher
yielding securities when the money market yield curve steepened somewhat in the
latter months of the annual period and when the Fed raised interest rates in
December 2016.
In that same light, i.e., in anticipation of higher interest rates, we
managed the Fund's weighted average maturity to remain as short as possible for
most of the annual period. The Fund generally maintained a weighted average
maturity in a range of between 20-30 days throughout the annual period, making
adjustments based on then-current market conditions, our near-term view on
interest rates and Fed monetary policy statements. We had also shortened the
Fund's weighted average maturity in the run-up to U.S. money market reform,
with final implementation taking effect in October 2016. Finally, we further
shortened the Fund's weighted average maturity heading into the December 2016
Fed interest rate increase. As of December 31, 2016, the Fund's weighted
average maturity stood at approximately 19 days. The Fund's weighted average
life/3/ on December 31, 2016 was 52 days.
The Fund was focused primarily on investments in U.S. government agency
floating-rate securities and U.S. Treasury securities, especially as its goal
was converting to a government money market fund, effective April 29, 2016. To
qualify as a government money market fund, the Fund must invest at least 99.5%
of its total assets in cash, U.S. government securities, and/or repurchase
agreements that are collateralized by cash and/or U.S. government securities.
--------
Past performance is no guarantee of future results.
/1/Source: Bloomberg
/2/Weighted average maturity is the average time it takes for securities in a
portfolio to mature, weighted in proportion to the dollar amount that is
invested in the portfolio. The weighted average maturity of a money market fund
is a measure of its price sensitivity to changes in interest rates.
/3/The weighted average life of a money market fund's portfolio is an average
of the final maturities of all securities held in the portfolio, weighted by
each security's percentage of net assets. Pursuant to SEC Rule 2a-7, the
maximum allowable weighted average life of a money market fund's portfolio is
120 days.
An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation (FDIC) or any other government agency. Although the Fund
seeks to preserve the value of your investment at $1.00 per share, it is
possible to lose money by investing in the Fund.
Securities listed may or may not be a part of current portfolio construction.
4
SunAmerica Money Market Funds, Inc.
EXPENSE EXAMPLE -- December 31, 2016 -- (unaudited)
Disclosure of Portfolio Expenses in Shareholder Reports
As a shareholder in the SunAmerica Government Money Market Fund (the "Fund"),
you may incur two types of costs: (1) transaction costs, including contingent
deferred sales charges, small account fees and administrative fees and
(2) ongoing costs, including management fees, distribution and account
maintenance fees, and other Fund expenses. This Example set forth below is
intended to help you understand your ongoing costs (in dollars) of investing in
the Fund and to compare these costs with the ongoing costs of investing in
other mutual funds. The Example is based on an investment of $1,000 invested at
July 1, 2016 and held until December 31, 2016.
Actual Expenses
The "Actual" section of the table provides information about actual account
values and actual expenses. You may use the information in these columns,
together with the amount you invested, to estimate the expenses that you paid
over the period. Simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply the result by the
number in the column under the heading entitled "Expenses Paid During the Six
Months Ended December 31, 2016" to estimate the expenses you paid on your
account during this period. For shareholder accounts in classes other than
Class I, the "Expenses Paid During the Six Months Ended December 31, 2016"
column and the "Annualized Expense Ratio" column do not include small account
fees that may be charged if your account balance is below $500 ($250 for
retirement plan accounts). In addition, the "Expenses Paid During the Six
Months Ended December 31, 2016" column and the "Annualized Expense Ratio"
column do not include administrative or other fees that may apply to qualified
retirement plan accounts and accounts held through financial institutions. See
the Fund's prospectus, your retirement plan documents and/or materials from
your financial adviser for a full description of these fees. Had these fees
been included, the "Expenses Paid During the Six Months Ended December 31,
2016" column would have been higher and the "Ending Account Value" column would
have been lower.
Hypothetical Example for Comparison Purposes
The "Hypothetical" section of the table provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an annual rate of return of 5% before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in the Fund and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of
other funds. For shareholder accounts in classes other than Class I, the
"Expenses Paid During the Six Months Ended December 31, 2016" column and the
"Annualized Expense Ratio" column do not include small account fees that may be
charged if your account balance is below $500 ($250 for retirement plan
accounts). In addition, the "Expenses Paid During the Six Months Ended December
31, 2016" column and the "Annualized Expense Ratio" column do not include
administrative fees that may apply to qualified retirement plan accounts and
accounts held through financial institutions. See the Fund's prospectus, your
retirement plan documents and/or materials from your financial adviser for a
full description of these fees. Had these fees been included, the "Expenses
Paid During the Six Months Ended December 31, 2016" column would have been
higher and the "Ending Account Value" column would have been lower.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transaction costs, including
contingent deferred sales charges, small account fees and administrative fees,
if applicable to your account. Please refer to the Fund's prospectus, qualified
retirement plan document and/or materials from your financial adviser for more
information. Therefore, the "Hypothetical" example is useful in comparing
ongoing costs only, and will not help you determine the relative total costs of
owning different funds. In addition, if these transaction costs and other fees
were included, your costs would have been higher.
5
SunAmerica Money Market Funds, Inc.
EXPENSE EXAMPLE -- December 31, 2016 -- (unaudited) (continued)
Actual Hypothetical
---------------------------------------------------- ----------------------------------------------------
Ending Ending Account
Account Value Expenses Paid Value Using Expenses Paid
Beginning Using Actual During the Beginning a Hypothetical 5% During the Annualized
Account Value Return at Six Months Ended Account Value Annual Return at Six Months Ended Expense
as July 1, 2016 December 31, 2016 December 31, 2016* as July 1, 2016 December 31, 2016 December 31, 2016* Ratio*
--------------- ----------------- ------------------ --------------- ----------------- ------------------ ----------
Government
Money
Market
Fund#
Class A.. $1,000.00 $1,000.05 $2.01 $1,000.00 $1,023.13 $2.03 0.40%
Class I.. $1,000.00 $1,000.05 $2.11 $1,000.00 $1,023.03 $2.14 0.42%
--------
* Expenses are equal to the Fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by 184 days then divided
by 366 days (to reflect the one-half year period). These ratios do not
reflect transaction costs, including contingent deferred sales charges,
small account fees and administrative fees, if applicable to your account.
Please refer to your Prospectus, your qualified retirement plan document
and/or materials from your financial adviser for more information.
# During the stated period, the investment adviser and distributor either
waived a portion of or all of the fees and assumed a portion of or all
expenses for the Fund. As a result, if these fees and expenses had not been
waived or assumed, the "Actual/Hypothetical Ending Account Value" would have
been lower and the "Actual/Hypothetical Expenses Paid During the Six Months
Ended December 31, 2016" and the "Annualized Expense Ratio" would have been
higher.
6
SunAmerica Money Market Funds, Inc.
STATEMENT OF ASSETS AND LIABILITIES -- December 31, 2016
Government Money
Market Fund
----------------
ASSETS:
Investments at value* (unaffiliated)............................... $111,896,276
Repurchase agreements (cost approximates value).................... 5,124,000
------------
Total Investments................................................ $117,020,276
------------
Cash............................................................... 13,217
Receivable for:
Fund shares sold................................................. 111,835
Dividends and interest........................................... 12,389
Prepaid expenses and other assets.................................. 17,013
Due from investment adviser for expense reimbursements/fee waivers. 134,525
Due from distributor for fee waivers............................... 13,033
------------
Total assets..................................................... 117,322,288
------------
LIABILITIES:
Payable for:
Fund shares redeemed............................................. 1,490,395
Investment advisory and management fees.......................... 48,875
Distribution and service maintenance fees........................ 14,123
Transfer agent fees and expenses................................. 41,404
Directors' fees and expenses..................................... 3,641
Other accrued expenses........................................... 136,691
Dividends payable.................................................. 694
------------
Total liabilities................................................ 1,735,823
------------
Net Assets...................................................... $115,586,465
============
Common stock, $.001 par value (3.5 billion shares authorized)...... $ 115,415
Paid-in capital.................................................... 115,447,881
------------
115,563,296
Accumulated undistributed realized gain (loss) on investment....... 23,169
------------
Net assets......................................................... $115,586,465
============
Class A:
Net assets......................................................... 102,735,228
Shares outstanding................................................. 102,590,565
Net asset value and redemption price per share
(excluding any applicable contingent deferred sales charge)....... $ 1.00
============
Class I:
Net assets......................................................... 12,851,237
Shares outstanding................................................. 12,824,210
Net asset value and redemption price per share..................... $ 1.00
============
*Amortized cost of investment securities (unaffiliated)............ $111,896,276
============
See Notes to Financial Statements
7
SunAmerica Money Market Funds, Inc.
STATEMENT OF OPERATIONS -- For the year ended December 31, 2016
Government Money
Market Fund
----------------
INVESTMENT INCOME:
Interest (unaffiliated)................................................................ $ 2,368,272
-----------
Total investment income............................................................. 2,368,272
-----------
EXPENSES:
Investment advisory and management fees................................................ 2,949,015
Distribution and account maintenance fees
Class A.............................................................................. 884,183
Transfer agent fees and expenses
Class A.............................................................................. 1,380,788
Class I.............................................................................. 29,180
Registration fees
Class A.............................................................................. 93,110
Class I.............................................................................. 13,841
Custodian and accounting fees.......................................................... 82,946
Reports to shareholders................................................................ 150,002
Audit and tax fees..................................................................... 54,626
Legal fees............................................................................. 58,340
Directors' fees and expenses........................................................... 42,096
Other expenses......................................................................... 14,139
-----------
Total expenses before fee waivers, expense reimbursements........................... 5,752,266
Fees waived and expenses reimbursed by investment adviser and distributor (Note 3).. (3,444,325)
-----------
Net expenses........................................................................ 2,307,941
-----------
Net investment income (loss)........................................................... 60,331
-----------
Net realized gain (loss) on investments................................................ 90,805
-----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 151,136
===========
See Notes to Financial Statements
8
SunAmerica Money Market Funds, Inc.
STATEMENT OF CHANGES IN NET ASSETS
Government Money Market Fund
----------------------------
For the year For the year
ended ended
December 31, December 31,
2016 2015
------------- -------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss)........................................................... $ 60,331 $ 72,785
Net realized gain (loss) on investments................................................ 90,805 1,145,974
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Net increase (decrease) in net assets resulting from operations.......................... $ 151,136 $ 1,218,759
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Distributions to shareholders from:
Net investment income (Class A)........................................................ (56,354) (71,367)
Net investment income (Class I)........................................................ (890) (1,418)
------------- -------------
Total distributions to shareholders...................................................... (57,244) (72,785)
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Net increase (decrease) in net assets resulting from capital share transactions (Note 5). (705,749,565) 83,893,269
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Total increase (decrease) in net assets.................................................. (705,655,673) 85,039,243
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NET ASSETS:
Beginning of period...................................................................... 821,242,138 736,202,895
------------- -------------
End of period*........................................................................... $ 115,586,465 $ 821,242,138
============= =============
*Includes accumulated undistributed net investment income (loss)......................... $ -- $ (26,197)
============= =============
See Notes to Financial Statements
9
SunAmerica Money Market Funds, Inc.
FINANCIAL HIGHLIGHTS
GOVERNMENT MONEY MARKET FUND
----------------------------
Net Net Net Ratio of net
Asset Dividends Asset Assets Ratio of investment
Value Net from net Value end of expenses income to
beginning investment investment end of Total period to average average
Period Ended of period income(1) income period Return(2) (000's) net assets(3) net assets(3)
------------ --------- ---------- ---------- ------ --------- -------- ------------- -------------
Class A
-
12/31/12 $1.00 $0.00 $(0.00) $1.00 0.01% $768,644 0.22% 0.01%
12/31/13 1.00 0.00 (0.00) 1.00 0.01 736,942 0.18 0.01
12/31/14 1.00 0.00 (0.00) 1.00 0.01 720,356 0.14 0.01
12/31/15 1.00 0.00 (0.00) 1.00 0.01(4) 807,427 0.17 0.01
12/31/16 1.00 0.00 (0.00) 1.00 0.01 102,735 0.38 0.01
Class I
-
12/31/12 $1.00 $0.00 $(0.00) $1.00 0.01% $ 15,765 0.22% 0.01%
12/31/13 1.00 0.00 (0.00) 1.00 0.01 13,360 0.18 0.01
12/31/14 1.00 0.00 (0.00) 1.00 0.01 15,847 0.14 0.01
12/31/15 1.00 0.00 (0.00) 1.00 0.01(4) 13,815 0.16 0.01
12/31/16 1.00 0.00 (0.00) 1.00 0.01 12,851 0.39 0.01
--------
(1) Calculated based upon average shares outstanding.
(2) Total return does not reflect sales load but does include expense
reimbursements.
(3) Net of the following expense reimbursements/waivers (based on average net
assets):
12/31/12 12/31/13 12/31/14 12/31/15 12/31/16
-------- -------- -------- -------- --------
Class A............. 0.72% 0.75% 0.79% 0.78% 0.57%
Class I............. 0.62 0.68 0.69 0.71% 0.56%
(4) The Fund's performance figure was increased by less than 0.01% from the
effect of payments by an affiliate (Note 3)
See Notes to Financial Statements
10
SunAmerica Government Money Market Fund
PORTFOLIO PROFILE -- December 31, 2016 -- (unaudited)
Industry Allocation*
U.S. Government Agencies.......... 53.6%
U.S. Government Treasuries........ 43.3
Repurchase Agreements............. 4.4
-----
101.3%
=====
Weighted average days to maturity. 18.6
Credit Quality Allocation@#
A-1......................... 100.0%
=====
--------
* Calculated as a percentage of net assets.
@ Source: Standard & Poors.
# Calculated as a percentage of total debt issues.
11
SunAmerica Government Money Market Fund
PORTFOLIO OF INVESTMENTS -- December 31, 2016
Principal Value
Security Description Amount (Note 2)
SHORT-TERM INVESTMENT SECURITIES -- 96.9%
U.S. GOVERNMENT AGENCIES -- 53.6%
Federal Farm Credit Bank FRS
0.78% due 03/29/2017........... $16,300,000 $16,298,088
0.79% due 02/16/2017........... 16,000,000 16,000,205
0.80% due 09/22/2017........... 2,000,000 2,001,978
Federal Home Loan Bank FRS
0.51% due 08/07/2017........... 250,000 250,000
0.71% due 12/05/2017........... 650,000 650,709
0.72% due 12/07/2017........... 750,000 750,503
0.77% due 02/27/2017........... 16,000,000 15,999,868
Federal Home Loan Mtg. Corp.
0.37% due 02/14/2017........... 3,000,000 2,998,643
Federal Home Loan Mtg. Corp. FRS
0.41% due 05/04/2017........... 2,750,000 2,750,000
0.80% due 04/27/2017........... 2,500,000 2,501,905
Federal National Mtg. Assoc. FRS
0.64% due 10/05/2017........... 700,000 700,387
0.76% due 07/20/2017........... 1,000,000 1,000,393
-----------
Total U.S. Government Agencies
(amortized cost $61,902,679)... 61,902,679
-----------
Principal Value
Security Description Amount (Note 2)
-----------------------------------------------------------------
U.S. GOVERNMENT TREASURIES -- 43.3%
United States Treasury Bills
0.33% due 01/19/2017................ $ 9,000,000 $ 8,998,538
0.35% due 01/05/2017................ 6,000,000 5,999,765
0.44% due 01/12/2017................ 35,000,000 34,995,294
------------
Total U.S. Government Treasuries
(amortized cost $49,993,597)........ 49,993,597
------------
Total Short-Term Investment Securities -- 96.9%
(amortized cost $111,896,276)....... 111,896,276
------------
REPURCHASE AGREEMENTS -- 4.4%
State Street Bank and Trust Co.
Joint Repurchase Agreement
(cost $5,124,000)(1)................. 5,124,000 5,124,000
------------
TOTAL INVESTMENTS
(amortized cost $117,020,276)(2).... 101.3% 117,020,276
Liabilities in excess of other assets. (1.3) (1,433,811)
----------- ------------
NET ASSETS............................ 100.0% $115,586,465
=========== ============
--------
(1)See Note 2 for details of Joint Repurchase Agreements.
(2)At December 31, 2016, the cost of securities for federal income tax purposes
was the same for book purposes.
FRS--Floating Rate Security
The rates shown on FRS are the current interest rates at December 31, 2016 and
unless noted otherwise, the dates shown are the original maturity dates.
The following is a summary of the inputs used to value the Fund's net assets as
of December 31, 2016 (see Note 2):
Level 1 -- Unadjusted Level 2 -- Other Level 3 -- Significant
Quoted Prices Observable Inputs Unobservable Inputs Total
--------------------- ----------------- ---------------------- ------------
Assets:
Investment at Value*
Short-Term Investment Securities. $-- $111,896,276 $-- $111,896,276
Repurchase Agreements............ -- 5,124,000 -- 5,124,000
--- ------------ --- ------------
Total Investments at Value....... $-- $117,020,276 $-- $117,020,276
=== ============ === ============
--------
* For a detailed presentation of investments, please refer to the Portfolio of
Investments.
The Fund's policy is to recognize transfers between Levels as of the end of the
reporting period. There were no transfers between Levels during the reporting
period.
See Notes to Financial Statements
12
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2016
Note 1. Organization
SunAmerica Money Market Funds, Inc. (the "Corporation") is an open-end
diversified management investment company organized as a Maryland
corporation. The Corporation consists of one series -- SunAmerica Government
Money Market Fund (the "Fund"). Effective April 29, 2016, the Fund, formerly
the SunAmerica Money Market Fund, converted from a prime money market fund
to a government money market fund and changed its name accordingly to the
SunAmerica Government Money Market Fund. The Fund is advised by SunAmerica
Asset Management, LLC ("SunAmerica" or "Adviser"), an indirect wholly-owned
subsidiary of American International Group, Inc. ("AIG"). The investment
objective of the Fund is to seek as high a level of current income as is
consistent with liquidity and stability of capital by investing at least
99.5% of its total assets in cash, U.S. government securities, and/or
repurchase agreements that are collateralized by U.S. government securities.
The Fund currently offers two classes of shares: Class A and Class I. These
classes within the Fund are presented in the Statement of Assets and
Liabilities. The cost structure for each class is as follows:
Class A shares-- Class A shares are available with no front-end sales
charge. A 1.00% contingent deferred sales charge ("CDSC")
is imposed on certain shares sold within one year of
original purchase and a 0.50% CDSC is imposed on certain
shares sold after the first year and within the second year
after purchase, as described in the Fund's Prospectus.
Class I shares-- Class I shares are offered at net asset value per share
without any sales charge, exclusively to certain
institutions.
Each class of shares bears the same voting, dividend, liquidation and other
rights and conditions, except as may otherwise be provided in the Fund's
registration statement.
Indemnifications: The Corporation's organizational documents provide current
and former officers and directors with a limited indemnification against
liabilities arising out of the performance of their duties to the
Corporation. In addition, pursuant to Indemnification Agreements between the
Corporation and each of the current directors who is not an "interested
person," as defined in Section 2(a)(19) of the Investment Company Act of
1940, as amended (the "1940 Act"), of the Corporation (collectively, the
"Disinterested Directors"), the Corporation provides the Disinterested
Directors with a limited indemnification against liabilities arising out of
the performance of their duties to the Corporation, whether such liabilities
are asserted during or after their service as directors. In addition, in the
normal course of business, the Corporation enters into contracts that
contain the obligation to indemnify others. The Corporation's maximum
exposure under these arrangements is unknown. Currently, however, the
Corporation expects the risk of loss to be remote.
Note 2. Significant Accounting Policies
The preparation of financial statements in accordance with U.S. generally
accepted accounting principles ("GAAP") requires management to make
estimates and assumptions that affect the reported amounts and disclosures
in the financial statements. Actual results could differ from those
estimates and those differences could be significant. The following is a
summary of significant accounting policies consistently followed by the Fund
in the preparation of its financial statements:
Security Valuation: In accordance with the authoritative guidance on fair
value measurements and disclosures under GAAP, the Fund discloses the fair
value of its investments in a hierarchy that prioritizes the inputs to
valuation techniques used to measure the fair value. In accordance with
GAAP, fair value is defined as the price that the Fund would receive upon
selling an asset or transferring a liability in a timely transaction to an
independent third party in the principal or most advantageous market. GAAP
establishes a three-tier hierarchy to provide more transparency around the
inputs used to measure fair value and to establish classification of fair
value measurements for disclosure purposes. Inputs refer broadly to the
assumptions that market participants would use in pricing the asset or
liability, including assumptions about risk. Inputs may be observable or
unobservable. Observable inputs are inputs that
13
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2016 -- (continued)
reflect the assumptions market participants would use in pricing the asset
or liability developed based on market data obtained from sources
independent of the reporting entity. Unobservable inputs are inputs that
reflect the reporting entity's own assumptions about the assumptions market
participants would use in pricing the asset or liability developed based on
the best information available in the circumstances. The three-tiers are as
follows:
Level 1 -- Unadjusted quoted prices in active markets for identical
securities
Level 2 -- Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
referenced indices, quoted prices in inactive markets, adjusted quoted
prices in active markets, adjusted quoted prices on foreign equity
securities that were adjusted in accordance with pricing procedures approved
by the Board of Directors (the "Board"), etc.)
Level 3 -- Significant unobservable inputs (includes inputs that reflect the
Fund's own assumptions about the assumptions market participants would use
in pricing the security, developed based on the best information available
under the circumstances)
Changes in valuation techniques may result in transfers in or out of an
investment's assigned Level within the hierarchy. The methodology used for
valuing investments is not necessarily an indication of the risk associated
with investing in those investments and the determination of the
significance of a particular input to the fair value measurement in its
entirety requires judgment and consideration of factors specific to each
security.
The availability of observable inputs can vary from security to security and
is affected by a wide variety of factors, including, for example, the type
of security, whether the security is recently issued and not yet established
in the marketplace, the liquidity of markets, and other characteristics
particular to the security. To the extent that valuation is based on models
or inputs that are less observable or unobservable in the market, the
determination of fair value requires more judgment. Accordingly, the degree
of judgment exercised in determining fair value is greatest for instruments
categorized in Level 3.
The summary of the Fund's assets and liabilities classified in the fair
value hierarchy as of December 31, 2016, is reported on a schedule following
the Portfolio of Investments.
Portfolio securities are valued at amortized cost, which approximates market
value, and are generally categorized as Level 2. The amortized cost method
involves valuing a security at its cost on the date of purchase and
thereafter assuming a constant amortization to maturity of any discount or
premium. In accordance with Rule 2a-7 under the 1940 Act, the Board has
adopted procedures intended to stabilize the Fund's net asset value per
share at $1.00. These procedures include the determination, at such
intervals as the Board deems appropriate and reasonable in light of current
market conditions, of the extent, if any, to which the Fund's market-based
net asset value per share deviates from the Fund's amortized cost per share.
The calculation of such deviation is referred to as "Shadow Pricing." For
purposes of these market-based valuations, securities for which market
quotations are not readily available are fair valued, as determined pursuant
to procedures adopted in good faith by the Board.
The Board is responsible for the share valuation process and has adopted
policies and procedures (the "PRC Procedures") for valuing the securities
and other assets held by the Fund, including procedures for the fair
valuation of securities and other assets for which market quotations are not
readily available or are unreliable. The PRC Procedures provide for the
establishment of a pricing review committee, which is responsible for, among
other things, making certain determinations in connection with the Fund's
fair valuation procedures. Securities for which market quotations are not
readily available or the values of which may be significantly impacted by
the occurrence of developments or significant events are generally
categorized as Level 3. There is no single standard for making fair value
determinations, which may result in prices that vary from those of other
funds.
Master Agreements: The Fund has entered into Master Repurchase Agreements
("Master Agreements") with certain counterparties that govern repurchase
agreement transactions. The Master Agreements may contain provisions
14
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2016 -- (continued)
regarding, among other things, the parties' general obligations,
representations, agreements, collateral requirements and events of default.
Collateral can be in the form of cash or securities as agreed to by the Fund
and applicable counterparty. The Master Agreements typically specify certain
standard termination events, such as failure of a party to pay or deliver,
credit support defaults and other events of default. Upon the occurrence of
an event of default, the other party may elect to terminate early and cause
settlement of all repurchase agreement transactions outstanding pursuant to
a particular Master Agreement, including the payment of any losses and costs
resulting from such early termination, as reasonably determined by the
terminating party. Any decision by one or more of the Fund's counterparties
to elect early termination could cause the Fund to accelerate the payment of
liabilities. Typically, the Master Agreement will permit a single net
payment in the event of default. Note, however, that bankruptcy or
insolvency laws of a particular jurisdiction may impose restrictions on or
prohibitions against the right of offset in bankruptcy, insolvency or other
events. As of December 31, 2016, the repurchase agreements held by the Fund
are subject to master netting provisions. See the Portfolio of Investments
and the Notes to Financial Statements for more information about the Fund's
holdings in repurchase agreements.
Repurchase Agreements: The Fund, along with other affiliated registered
investment companies, pursuant to procedures adopted by the Board and
applicable guidance from the Securities and Exchange Commission ("SEC"), may
transfer uninvested cash balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or federal agency obligations. In a
repurchase agreement, the seller of a security agrees to repurchase the
security at a mutually agreed-upon time and price, which reflects the
effective rate of return for the term of the agreement. For repurchase
agreements and joint repurchase agreements, the Fund's custodian takes
possession of the collateral pledged for investments in such repurchase
agreements. The underlying collateral is valued daily on a mark to market
basis, plus accrued interest to ensure that the value, at the time the
agreement is entered into, is equal to at least 102% of the repurchase
price, including accrued interest. In the event of default of the obligation
to repurchase, the Fund has the right to liquidate the collateral and apply
the proceeds in satisfaction of the obligation. If the seller defaults and
the value of the collateral declines or if bankruptcy proceedings are
commenced with respect to the seller of the security, realization of the
collateral by the Fund may be delayed or limited.
As of December 31, 2016, the Fund held an undivided interest in the joint
repurchase agreement with State Street Bank and Trust Co.:
Percentage Principal
Ownership Amount
- ---------- ----------
Government Money Market Fund...................... 1.88% $5,124,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
State Street Bank and Trust Co., dated December 31, 2016, bearing interest
at a rate of 0.01% per annum, with a principal amount of $272,814,000, a
repurchase price of $272,814,303, and a maturity date of January 3, 2017.
The repurchase agreement is collateralized by the following:
Interest Maturity Principal
Type of Collateral Rate Date Amount Value
------------------ -------- ---------- ----------- ------------
U.S. Treasury Bonds................ 1.38% 6/30/2018 $85,370,000 $ 86,324,010
U.S. Treasury Bonds................ 2.38 6/30/2018 85,000,000 87,593,435
U.S. Treasury Bonds................ 3.38 11/15/2019 98,615,000 104,356,661
Securities Transactions, Investment Income, Expenses, Dividends and
Distributions to Shareholders: Security transactions are recorded on a trade
date basis. Interest income, including the accretion of discount and
amortization of premium, is accrued daily from settlement date, except when
collection is not expected; dividend income is recorded on the ex-dividend
date.
15
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2016 -- (continued)
Net investment income, other than class specific expenses, and realized and
unrealized gains and losses are allocated daily to each class of shares
based upon the relative net asset value of outstanding shares (or the value
of the dividend-eligible shares, as appropriate) of each class of shares at
the beginning of the day (after adjusting for current capital share activity
of the respective class).
Dividends from net investment income, if any, are normally declared daily
and paid monthly. Capital gain distributions, if any, are paid annually. The
Fund records dividends and distributions to its shareholders on the
ex-dividend date. The amount of dividends and distributions from net
investment income and net realized capital gains are determined in
accordance with federal income tax regulations, which may differ from GAAP.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such
amounts are reclassified within the capital accounts at fiscal year end
based on their federal tax-basis treatment; temporary differences do not
require reclassification. Net assets are not affected by these
reclassifications.
The Fund is considered a separate entity for tax purposes and intends to
comply with the requirements of the Internal Revenue Code, as amended,
applicable to regulated investment companies and distribute all of its
taxable income, including any net capital gains on investments, to its
shareholders. The Fund also intends to distribute sufficient net investment
income and net capital gains, if any, so that the Fund will not be subject
to excise tax on undistributed income and gains. Therefore, no federal
income tax or excise tax provision is required.
The Fund recognizes the tax benefits of uncertain tax positions only when
the position is more likely than not to be sustained, assuming examination
by tax authorities. Management has analyzed the Fund's tax positions and
concluded that no liability for unrecognized tax benefits should be recorded
related to uncertain tax positions taken on returns filed for open tax years
2013 - 2015 or expected to be taken in the Fund's 2016 tax return. The Fund
is not aware of any tax provisions for which it is reasonably possible that
the total amounts of unrecognized tax benefits will change materially in the
next twelve months. The Fund files U.S. federal and certain state income tax
returns. With few exceptions, the Fund is no longer subject to U.S. federal
and state tax examinations by tax authorities for tax returns ending before
2013.
Note 3. Investment Advisory and Management Agreement, Distribution and Service
Agreement and Other Transactions With Affiliates
The Fund has entered into an Investment Advisory and Management Agreement
(the "Advisory Agreement") with SunAmerica. Under the Advisory Agreement,
SunAmerica provides continuous supervision of the Fund and administers its
corporate affairs, subject to general review by the Board. In connection
therewith, SunAmerica furnishes the Fund with office facilities, maintains
certain of its books and records, and pays the salaries and expenses of all
personnel, including officers of the Fund who are employees of SunAmerica
and its affiliates.
The Fund will pay SunAmerica a monthly management fee at the following
annual percentages, based on the average daily net assets of the Fund: 0.50%
on the first $600 million; 0.45% on the next $900 million; and 0.40% over
$1.5 billion.
SunAmerica has contractually agreed to waive fees and/or reimburse expenses
to the extent necessary to cap the Fund's annual fund operating expenses at
0.80% for Class I, of average net assets. For purposes of waived fee and/or
reimbursed expense calculations, annual Fund operating expenses shall not
include extraordinary expenses (i.e., expenses that are unusual in nature
and/or infrequent in occurrence, such as litigation), or acquired fund fees
and expenses, brokerage commissions and other transactional expenses
relating to the purchase and sale of portfolio securities, interest, taxes
and governmental fees, and other expenses not incurred in the ordinary
course of the Fund's business. This fee waiver and expense reimbursement
will continue in effect indefinitely, unless terminated by the Board,
including a majority of the Disinterested Directors. For the year ended
December 31, 2016, pursuant to the contractual expense limitations,
SunAmerica waived fees and/or reimbursed expenses of $23,738 for Class I.
16
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2016 -- (continued)
SunAmerica may also voluntarily waive fees and/or reimburse expenses,
including to avoid a negative yield on any class of the Fund. The voluntary
waivers and/or reimbursements may be terminated at any time at the option of
SunAmerica. The exact amount of the voluntary waivers and/or reimbursements
may change on a day-to-day basis. There is no guarantee that the Fund will
be able to avoid a negative yield. For the year ended December 31, 2016,
SunAmerica voluntarily waived fees and/or reimbursed expenses of $2,490,696
and $45,708 for Class A and Class I, respectively.
The Fund has entered into a Distribution Agreement with AIG Capital
Services, Inc. ("ACS" or the "Distributor"), an affiliate of the Adviser.
The Fund has adopted a Distribution Plan on behalf of its Class A shares
(the "Plan") in accordance with the provisions of Rule 12b-1 under the 1940
Act. In adopting the Plan, the Board determined that there was a reasonable
likelihood that the Plan would benefit the Fund and the shareholders of the
respective class. The sales charge and distribution fees of a particular
class will not be used to subsidize the sale of shares of any other class.
The Plan provides that the Class A shares of the Fund shall pay the
Distributor an account maintenance fee at the annual rate of up to 0.15% of
the aggregate average daily net assets of such class of shares for payments
to compensate the Distributor and certain securities firms for account
maintenance activities. In this regard, some payments are used to compensate
broker-dealers with account maintenance fees in an amount up to 0.15% per
year of the assets maintained in the Fund by its customers. Accordingly, ACS
received fees (see Statement of Operations) based upon the aforementioned
rates. In addition, in light of current market conditions, and in order to
avoid a negative yield on Class A shares of the Fund, ACS has agreed to
waive up to 0.15% of the fees it receives under the Plan. This voluntary
waiver may be terminated at any time at the option of the Distributor
without notice to shareholders. For the year ended December 31, 2016, ACS
voluntarily waived $884,183 in account maintenance fees for Class A shares.
ACS receives the proceeds of contingent deferred sales charges paid by
investors in connection with certain redemptions of the Fund's Class A
shares. ACS has advised the Fund that for the year ended December 31, 2016,
the proceeds received from redemptions are as follows:
Class A........................................... $201
The Fund has entered into a Service Agreement with SunAmerica Fund Services,
Inc. ("SAFS"), an affiliate of the Adviser. Under the Service Agreement,
SAFS performs certain shareholder account functions by assisting the Fund's
transfer agent in connection with the services that it offers to the
shareholders of the Fund. The Service Agreement, which permits the Fund to
compensate SAFS for services rendered based upon the annual rate of 0.22% of
average daily net assets, is approved annually by the Board. For the year
ended December 31, 2016, the Fund incurred the following expenses which are
included in transfer agent fees and expenses payable line in the Statement
of Assets and Liabilities and in transfer agent fees and expenses in the
Statement of Operations to compensate SAFS pursuant to the terms of the
Service Agreement:
Payable at
Expenses December 31, 2016
---------- -----------------
Class A........................................... $1,291,251 $19,115
Class I........................................... 27,109 2,391
As of result of losses on medium-term notes issued by Cheyne Finance LLC,
that were previously held by the Fund, SunAmerica made capital contributions
to the Fund of $0 and $1,136,168 for the periods ended December 31, 2016 and
December 31, 2015, respectively.
17
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2016 -- (continued)
Note 4. Federal Income Taxes
The following details the tax basis of distributions as well as the
components of distributable earnings. The tax basis components of
distributable earnings differ from the amounts reflected in the Statement of
Assets and Liabilities by temporary book/tax differences primarily arising
from dividends payable.
Distributable Earnings Tax Distributions Tax Distributions
----------------------------------------- ------------------------------------- -------------------------------------
For the year ended December 31, 2016 For the year ended December 31, 2016 For the year ended December 31, 2015
----------------------------------------- ------------------------------------- -------------------------------------
Long-term Gains/ Unrealized Long-Term Long-Term
Ordinary Capital and Other Appreciation Ordinary Capital Ordinary Capital
Income Losses (Depreciation) Income Gains Income Gains
-------- ----------------- -------------- -------- --------- -------- ---------
$23,170 $ -- $ -- $57,244 $ -- $72,785 $ --
For the year ended December 31, 2016, reclassifications were made to
decrease accumulated net realized gain (loss) by $67,636 with an offsetting
adjustment to undistributed net investment income and paid in capital of
$23,110 and $44,526, respectively. The reclassifications arising from
book/tax differences were due primarily to equalization debits.
Note 5. Capital Share Transactions
Transactions in each class of shares of the Fund (at $1.00 per share) were
as follows:
Class A Class I
---------------------------- --------------------------
For the For the For the For the
year year year year
ended ended ended ended
December 31, December 31, December 31, December 31,
2016 2015 2016 2015
------------- ------------- ------------ ------------
Shares sold............. $ 215,584,499 $ 574,424,150 $ 10,430,504 $ 12,456,914
Reinvested dividends.... 55,878 68,295 1,219 1,401
Shares redeemed......... (920,421,483) (488,545,609) (11,400,182) (14,511,882)
------------- ------------- ------------ ------------
Net increase (decrease). $(704,781,106) $ 85,946,836 $ (968,459) $ (2,053,567)
============= ============= ============ ============
Note 6. Interfund Lending Agreement
Pursuant to the exemptive relief granted by the SEC, the Fund is permitted
to participate in an interfund lending program among investment companies
advised by SunAmerica or an affiliate. The interfund lending program allows
the participating Funds to borrow money from and lend money to each other
for temporary or emergency purposes. An interfund loan will be made under
this facility only if the participating Funds receive a more favorable
interest rate than would otherwise be available from a typical bank for a
comparable transaction. For the year ended December 31, 2016, the Fund did
not participate in this program.
Note 7. Subsequent Event
On November 18, 2016, the Board approved a change in the name of the
SunAmerica Government Money Market Fund to the "AIG Government Money Market
Fund," effective February 28, 2017.
18
SunAmerica Money Market Funds, Inc.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of SunAmerica Money Market Funds,
Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of SunAmerica Government Money Market
Fund (formerly SunAmerica Money Market Fund) (the "Fund" constituting
SunAmerica Money Market Funds, Inc.) as of December 31, 2016, the results its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the five years in the period then ended, in conformity with accounting
principles generally accepted in the United States of America. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities as of December 31, 2016
by correspondence with the custodian and brokers, provide a reasonable basis
for our opinion expressed above.
PricewaterhouseCoopers LLP
Houston, Texas
February 27, 2017
19
SunAmerica Money Market Funds, Inc.
DIRECTORS AND OFFICERS INFORMATION -- December 31, 2016 -- (unaudited)
The following table contains basic information regarding the Directors and
Officers who oversee operations of the Fund and other investment companies
within the Fund complex.
Number of
Position Term of Portfolios in
Held With Office and Fund Complex
Name, Address SunAmerica Length of Principal Occupations Overseen by Other Directorships
and Age* Complex Time Served(4) During Past 5 Years Trustee(1) Held by Trustee(2)
-------------------- ---------- -------------- --------------------------- ------------- -----------------------
Disinterested Trustees
Dr. Judith L. Craven Trustee 2000-present Retired. 78 Director, Sysco Corp.
Age: 71 (1996 to present);
Director, Luby's, Inc.
(1998 to present).
William F. Devin Trustee 2001-present Retired. 78 None
Age: 78
Richard W. Grant Trustee 2011-present Retired. Prior to that, 29 None
Age: 71 Chairman attorney and partner at
of the Morgan Lewis & Bockius
Board LLP (1989 to 2011).
Stephen J. Gutman Trustee 1984-present Senior Vice President 29 None
Age: 73 and Associate Broker,
Corcoran Group (real
estate) (2002 to present);
President, SJG Marketing
Inc. (2009 to present).
Interested Trustees
Peter A. Harbeck(3) Trustee 1994-present President, CEO and 141 None
Age: 63 Director, SunAmerica.
(1995 to present);
Director, AIG Capital
Services, Inc. ("ACS")
(1993 to present).
20
SunAmerica Money Market Funds, Inc.
DIRECTORS AND OFFICERS INFORMATION -- December 31, 2016 -- (unaudited)
(continued)
Number of
Position Term of Portfolios in
Held With Office and Fund Complex
Name, Address SunAmerica Length of Principal Occupations Overseen by Other Directorships
and Age* Complex Time Served(4) During Past 5 Years Trustee(1) Held by Trustee(2)
------------------- ------------ -------------- -------------------------- ------------- -------------------
Officers
John T. Genoy President 2007-present Chief Financial Officer, N/A N/A
Age: 48 SunAmerica (2002 to
present); Senior Vice
President, SunAmerica
(2003 to present); Chief
Operating Officer,
SunAmerica (2006
to present).
Gregory N. Bressler Secretary 2005-present Senior Vice President N/A N/A
Age: 50 and General Counsel,
SunAmerica (2005 to
present).
Kathleen D. Fuentes Chief Legal 2013-present Vice President and N/A N/A
Age: 47 Officer and Deputy General Counsel,
Assistant SunAmerica (2006 to
Secretary present).
James Nichols Vice 2006-present Director, President and N/A N/A
Age: 50 President CEO, ACS (2006 to
present); Senior Vice
President, SunAmerica
(2002 to present).
Kara Murphy Vice 2014-present Chief Investment Officer, N/A N/A
Age: 44 President SunAmerica (2013 to
present).
Gregory R. Kingston Treasurer 2014-present Vice President, N/A N/A
Age: 51 SunAmerica (2001 to
present), Head of Mutual
Fund Administration,
SunAmerica (2014 to
present).
Shawn Parry Vice 2014-present Vice President (2014 to N/A N/A
Age: 44 President present) and Assistant
and Vice President,
Assistant SunAmerica (2005 to
Treasurer 2014).
Donna McManus Vice 2014-present Vice President, N/A N/A
Age: 56 President SunAmerica, (2014 to
and present); Managing
Assistant Director, BNY Mellon
Treasurer (2009 to 2014).
21
SunAmerica Money Market Funds, Inc.
DIRECTORS AND OFFICERS INFORMATION -- December 31, 2016 -- (unaudited)
(continued)
Number of
Position Term of Portfolios in
Held With Office and Fund Complex
Name, Address SunAmerica Length of Principal Occupations Overseen by Other Directorships
and Age* Complex Time Served(4) During Past 5 Years Trustee(1) Held by Trustee(2)
-------------------- ----------- -------------- --------------------------- ------------- -------------------
Matthew J. Hackethal Acting 2006-present Acting Chief Compliance N/A N/A
Age: 45 Chief Officer (2016 to present);
Compliance Chief Compliance Officer
Officer; (2006 to present) and
Anti-Money Vice President,
Laundering SunAmerica (2011 to
Compliance present).
Officer
--------
* The business address for each Trustee is the Harborside 5, 185 Hudson
Street, Suite 3300, Jersey City, NJ 70311.
(1) The "Fund Complex" means two or more registered investment companies that
hold themselves out to investors as related companies for purposes of
investment services or have a common investment adviser or an investment
adviser that is an affiliated person of the Adviser. The "Fund Complex"
includes the Fund (1 fund), SunAmerica Specialty Series (8 funds),
SunAmerica Equity Funds (2 funds), SunAmerica Income Funds (3 funds),
SunAmerica Series, Inc. (6 portfolios), Anchor Series Trust (8 portfolios),
SunAmerica Senior Floating Rate Fund, Inc. (1 fund), SunAmerica Series
Trust (43 portfolios), VALIC Company I (34 portfolios), VALIC Company II
(15 funds), Seasons Series Trust (20 portfolios).
(2) Directorships of companies required to report to the SEC under the
Securities Exchange Act of 1934 (i.e., "public companies") or other
investment companies registered under the 1940 Act.
(3) Interested Trustee, as defined within the 1940 Act, because he is an
officer and a director of the Adviser and a director of the principal
underwriter of the Fund.
(4) Trustees serve until their successors are duly elected and qualified. Each
officer will hold office for an indefinite term, until the date he or she
resigns or retires or until his/her successor is duly elected and qualifies.
Additional information concerning the Trustees is contained in the Statement of
Additional Information which is available, without charge, by calling (800)
858-8850.
22
SUNAMERICA MONEY MARKET FUNDS, INC.
SHAREHOLDER TAX INFORMATION -- (UNAUDITED)
Certain tax information regarding the Fund is required to be provided to
shareholders based upon the Fund's income and distributions for the taxable
year ended December 31, 2016. The information necessary to complete your income
tax returns is included with your Form 1099-DIV, which will be mailed to you in
early 2017.
23
[LOGO]
Harborside 5
185 Hudson Street, Suite 3300
Jersey City, NJ 07311
Directors/Trustees Transfer Agent DISCLOSURE OF QUARTERLY
Dr. Judith L. Craven State Street Bank and PORTFOLIO HOLDINGS
William F. Devin Trust Company The Fund is required to
Richard W. Grant P.O. Box 219373 file its complete
Stephen J. Gutman Kansas City, MO 64141 schedule of portfolio
Peter A. Harbeck Custodian holdings with the U.S.
Officers State Street Bank and Securities and Exchange
John T. Genoy, President Trust Company Commission for its first
and Chief Executive One Lincoln St. and third fiscal quarters
Officer Boston, MA 02111 on Form N-Q. The Fund's
Gregory R. Kingston, VOTING PROXIES ON FUND Forms N-Q are available
Treasurer PORTFOLIO SECURITIES on the U.S. Securities
Kara Murphy, Vice A description of the and Exchange Commission's
President policies and procedures website at
James Nichols, Vice that the Funds use to http://www.sec.gov. You
President determine how to vote can also review and
Gregory N. Bressler, proxies relating to obtain copies of the
Secretary securities held in the Forms N-Q at the U.S.
Kathleen Fuentes, Chief Funds' portfolios which Securities and Exchange
Legal Officer and is available in the Commission's Public
Assistant Secretary Funds' Statement of Reference Room in
Donna McManus, Vice Additional Information Washington, DC
President and may be obtained without (information on the
Assistant Treasurer charge upon request, by operation of the Public
Shawn Parry, Vice calling (800) 858-8850. Reference Room may be
President and This information is also obtained by calling
Assistant Treasurer available from the EDGAR 1-800-SEC-0330).
Matthew J. Hackethal, database on the U.S. PROXY VOTING RECORD ON
Acting Chief Securities and Exchange FUND PORTFOLIO SECURITIES
Compliance Officer, Commission's website at Information regarding how
Anti-Money Laundering http://www.sec.gov. the Funds voted proxies
Compliance Officer DELIVERY OF SHAREHOLDER relating to securities
Investment Adviser DOCUMENTS held in the Fund's
SunAmerica Asset The Funds have adopted a portfolio during the most
Management, LLC policy that allows them recent twelve month
Harborside 5 to send only one copy of period ended June 30 is
185 Hudson Street, Suite a Fund's prospectus, available, once filed
3300 proxy material, annual with the U.S. Securities
Jersey City, NJ 07311 report and semi-annual and Exchange Commission,
Distributor report (the "shareholder without charge, upon
AIG Capital Services, documents") to request, by calling (800)
Inc. shareholders with 858-8850 or on the U.S.
Harborside 5 multiple accounts Securities and Exchange
185 Hudson Street, Suite residing at the same Commission's website at
3300 "household." This http://www.sec.gov.
Jersey City, NJ 07311 practice is called This report is submitted
Shareholder Servicing householding and reduces solely for the general
Agent Fund expenses, which information of
SunAmerica Fund benefits you and other shareholders of the Fund.
Services, Inc. shareholders. Unless the Distribution of this
Harborside 5 Funds receive report to persons other
185 Hudson Street, Suite instructions to the than shareholders of the
3300 contrary, you will only Fund is authorized only
Jersey City, NJ 07311 receive one copy of the in connection with a
shareholder documents. currently effective
The Funds will continue prospectus, setting forth
to household the details of the Fund,
shareholder documents which must precede or
indefinitely, until we accompany this report.
are instructed otherwise.
If you do not wish to
participate in
householding, please
contact Shareholder
Services at
(800) 858-8850 ext. 6010
or send a written request
with your name, the name
of your fund(s) and your
account member(s) to
SunAmerica Mutual Funds
c/o BFDS, P.O. Box
219186, Kansas City MO,
64121-9186. We will
resume individual
mailings for your account
within thirty (30) days
of receipt of your
request.
[GRAPHIC]
GO PAPERLESS!!
DID YOU KNOW THAT YOU HAVE THE OPTION TO
RECEIVE YOUR SHAREHOLDER REPORTS ONLINE?
By choosing this convenient service, you will no longer receive paper copies of
Fund documents such as annual reports, semi-annual reports, prospectuses and
proxy statements in the mail. Instead, you are provided with quick and easy
access to this information via the Internet.
Why Choose Electronic Delivery?
IT'S QUICK -- Fund documents will be received faster than via traditional mail.
IT'S CONVENIENT -- Elimination of bulky documents from personal files.
IT'S COST EFFECTIVE -- Reduction of your Fund's printing and mailing costs.
TO SIGN UP FOR ELECTRONIC DELIVERY, FOLLOW
THESE SIMPLE STEPS:
1 GO TO WWW.SAFUNDS.COM
2 CLICK ON THE LINK TO "GO PAPERLESS!!"
The email address you provide will be kept strictly confidential. Once your
enrollment has been processed, you will begin receiving email notifications
when anything you receive electronically is available online.
You can return to www.safunds.com at any time to change your email
address, edit your preferences or to cancel this service if you choose to
resume physical delivery of your Fund documents.
Please note - this option is only available to accounts opened through the
Funds.
FOR INFORMATION ON RECEIVING THIS REPORT ONLINE, SEE INSIDE BACK COVER.
DISTRIBUTED BY:
AIG CAPITAL SERVICES, INC.
This fund report must be preceded by or accompanied by a prospectus.
Investors should carefully consider a Fund's investment objectives, risks,
charges and expenses before investing. The prospectus, containing this and
other important information, can be obtained from your financial adviser, the
SunAmerica Sales Desk at 800-858-8850, ext. 6003, or at www.safunds.com. Read
the prospectus carefully before investing.
WWW.SAFUNDS.COM
MMANN - 12/16
[LOGO]
AIG
Sun America
Mutual Funds
Item 2. Code of Ethics
SunAmerica Money Market Funds, Inc. ("the registrant") has adopted a
Code of Ethics applicable to its Principal Executive and Principal
Accounting Officers pursuant to Section 406 of the Sarbanes-Oxley Act
of 2002. During the fiscal year ended 2016, there were no reportable
amendments, waivers or implicit waivers to a provision of the Code of
Ethics that applies to the registrant's Principal Executive and
Principal Accounting Officers.
Item 3. Audit Committee Financial Expert.
Currently, the registrant does not have an Audit Committee member who
possesses all of the attributes required to be an "audit committee
financial expert," as defined in instruction 2(b) of Item 3 of Form
N-CSR. However, the Board of Directors believes that the members of
the Audit Committee have substantial experience relating to the review
of financial statements and the operations of audit committees.
Accordingly, the Board believes that the members are qualified to
evaluate the registrant's financial statements, supervise the
registrant's preparation of its financial statements, and oversee the
work of the registrant's independent auditors.
Item 4. Principal Accountant Fees and Services.
(a)--(d) Aggregate fees billed to the registrant for the last two
fiscal years for professional services rendered by the registrant's
principal accountant were as follows:
2015 2016
(a) Audit Fees............................. $43,346 $45,443
(b) Audit-Related Fees..................... $ 0 $ 0
(c) Tax Fees............................... $11,452 $11,795
(d) All Other Fees......................... $ 0 $ 0
Audit Fees include amounts related to the audit of the registrant's
annual financial statements and services normally provided by the
principal accountant in connection with statutory and regulatory
filings. Tax fees principally include tax compliance, tax advice, tax
planning and preparation of tax returns.
Aggregate fees billed to the investment adviser and Adviser Affiliates
(as defined below in Item 4(e)) that are required to be pre-approved
pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X for
the last two fiscal years for services rendered by the registrant's
principal accountant were as follows:
2015 2016
(b) Audit-Related Fees.................... $ 0 $0
(c) Tax Fees.............................. $ 0 $0
(d) All Other Fees........................ $17,640 $0
(e) (1) The registrant's audit committee pre-approves all audit services
provided by the registrant's principal accountant for the registrant
and all non-audit services provided by the registrant's principal
accountant for the registrant, its investment adviser and any entity
controlling, controlled by, or under common control with the
investment adviser ("Adviser Affiliates") that provides ongoing
services to the registrant, if the engagement by the investment
adviser or Adviser Affiliate relates directly to the operations and
financial reporting of the registrant. The audit committee has not
presently established any pre-approval policies and procedures that
permit the pre-approval of the above services other than by the full
audit committee. Certain de minimis exceptions are allowed for
non-audit services in accordance with Rule 2-01(c)(7)(i)(C) of
Regulation S-X as set forth in the registrant's audit committee
charter.
(2) No services included in (b)-(d) above in connection with fees
billed to the registrant or the investment adviser or Adviser
Affiliates were approved pursuant to paragraph (c)(7)(i)(C) of Rule
2-01 of Regulation S-X.
(f) Not applicable.
(g) The aggregate fees billed for the most recent fiscal year and the
preceding fiscal year by the registrant's principal accountant for
non-audit services rendered to the registrant, its investment adviser,
and Adviser Affiliates that provide ongoing services to the registrant
for 2015 and 2016 were $48,117 and $11,795, respectively.
(h) Not applicable.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
Included in Item 1 to the Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which shareholders
may recommend nominees to the registrant's Board of Directors that
were implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation S-K
(17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A (17
CFR 240.14a - 101)), or this Item 10.
Item 11. Controls and Procedures.
(a) An evaluation was performed within 90 days of the filing of this
report, under the supervision and with the participation of the
registrant's management, including the President and Treasurer, of the
effectiveness of the design and operation of the registrant's
disclosure controls and procedures (as defined in Rule 30a-3(c) under
the Investment Company Act of 1940 (17 CFR 270.30a-3(c))). Based on
that evaluation, the registrant's management, including the President
and Treasurer, concluded that the registrant's disclosure controls and
procedures are effective.
(b) There was no change in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940 (17 CFR 270.30a-3(d))) that occurred during the
registrant's last fiscal quarter of the period covered by this report
that has materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial reporting.
Item 12. Exhibits.
(a) (1) Code of Ethics applicable to its Principal Executive and Principle
Accounting Officers pursuant to Section 406 of the Sarbanes-Oxley Act
of 2002 attached hereto as Exhibit 99.406. Code of Ethics.
(2) Certifications pursuant to Rule 30a-2(a) under the Investment
Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit
99.CERT.
(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company
Act of 1940 (17 CFR 270.30a-2(a)) and Section 906 of the
Sarbanes-Oxley Act of 2002 attached hereto as Exhibit 99.906.CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
SunAmerica Money Market Funds, Inc.
By: /s/ John T. Genoy
--------------------------
John T. Genoy
President
Date: March 9, 2017
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ John T. Genoy
--------------------------
John T. Genoy
President
Date: March 9, 2017
By: /s/ Gregory R. Kingston
--------------------------
Gregory R. Kingston
Treasurer
Date: March 9, 2017