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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, 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,
Jersey City, NJ 07311
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(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, 2019
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Item 1. Reports to Stockholders
ANNUAL REPORT 2019
AIG
Government Money Market Fund
[PHOTO]
Beginning on January 1, 2021, as permitted by regulations adopted by the
Securities and Exchange Commission, paper copies of each Fund's shareholder
reports will no longer be sent by mail, unless you specifically request paper
copies of the reports from the Fund or your financial intermediary. Instead,
the reports will be made available on a website, and you will be notified by
mail each time a report is posted and provided with a website link to access
the report.
If you already elected to receive shareholder reports electronically, you will
not be affected by this change and you need not take any action. At any time,
you may elect to receive reports and other communications from a Fund
electronically by calling 800-858-8850 or contacting your financial
intermediary directly.
You may elect to receive all future reports in paper free of charge. If your
account is held directly at the Fund, you can inform the Fund that you wish to
receive paper copies of reports by calling 800-858-8850. If your account is
held through a financial intermediary, please contact the financial
intermediary to make this election. Your election to receive paper will apply
to all AIG Funds in which you are invested and may apply to all funds held with
your financial intermediary.
[LOGO]
aig.com/funds
Table of Contents
SHAREHOLDERS' LETTER........................................ 2
EXPENSE EXAMPLE............................................. 4
STATEMENT OF ASSETS AND LIABILITIES......................... 6
STATEMENT OF OPERATIONS..................................... 7
STATEMENT OF CHANGES IN NET ASSETS.......................... 8
FINANCIAL HIGHLIGHTS........................................ 9
PORTFOLIO OF INVESTMENTS.................................... 10
NOTES TO FINANCIAL STATEMENTS............................... 12
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM..... 18
DIRECTORS AND OFFICERS INFORMATION.......................... 19
SHAREHOLDER TAX INFORMATION................................. 21
Shareholders' Letter -- (unaudited)
Dear Shareholders,
We are pleased to present this annual shareholder report for the AIG Government
Money Market Fund (the "Fund") for the 12 months ended December 31, 2019.
The annual period ended December 31, 2019 was one where money market yields
moved lower. While the Federal Reserve (the "Fed") held interest rates steady
during the first two quarters of 2019, it reduced interest rates three times
during the second half of the calendar year - in July, September and October.
Each rate reduction was 25 basis points,/*/ bringing the targeted federal funds
rate to a range of 1.50% to 1.75% by the end of December 2019. In a rather
significant shift from its stance in 2018, the Fed adopted an increasingly
dovish/**/ bias as the months progressed. The Fed's shift was based both on an
effort to maintain financial stability following the heightened market
volatility of the fourth quarter of 2018 and on heightened geopolitical risks
and a downward drift in inflation expectations. Also affecting the money
markets during the annual period was the Fed putting its balance sheet
normalization+ on hold. The Fed noted that it expected to slow its balance
sheet runoff plan beginning in May 2019 and stop it completely by September
2019. Instead, the Fed expanded its balance sheet by approximately
$400 billion, sparked by the repurchase agreement crisis in September 2019. The
Fed indicated this was not another round of quantitative easing but rather an
attempt to keep money markets in check after an episode in which interest rates
for repurchase agreements - essentially short-term loans between banks and
other financial institutions - spiked in September. The run-up spilled over
into the money markets, pushing the Fed's policy rate temporarily above the
range that policymakers were targeting. At its December 2019 meeting, citing
the resiliency of the economy, the Fed left the target range for its federal
funds rate unchanged and signaled interest rates were likely to stay on hold
for "a time" as long as the economy stays on track.
Global monetary policies followed a similar path. The European Central Bank
(ECB) delivered a sweeping package to bolster the Eurozone economy against
slowing growth and trade frictions, including a rate cut, resumption of asset
purchases and more favorable bank lending conditions. New ECB President
Christine Lagarde subsequently indicated its monetary policy would remain
unchanged for the foreseeable future. The Bank of Japan trimmed its asset
purchase program, citing an improving growth trend, but maintained its negative
interest rate policy. The Norges Bank, Norway's central bank, elected to keep
its rates on hold during the fourth quarter of 2019 after three increases
earlier in the year. Many other central banks undertook strategic reviews of
their policies, balancing the need to meet their inflation objective while not
adding to the growing signs of financial excess.
The U.S. Treasury money market yield curve, or spectrum of maturities, changed
shape often. During the first quarter of 2019, the money market yield curve was
upward sloping, meaning yields on longer-term maturities were higher than those
on shorter-term maturities. Toward the end of the second quarter, the money
market yield curve inverted -- meaning yields on shorter-term maturities were
higher than those on longer-term maturities. As the Fed subsequently reduced
interest rates three times, the money market yield curve became relatively flat
by the end of the annual period, with little difference in yields across the
spectrum of maturities.
On the following pages, you will find a brief discussion of the annual period
from the portfolio manager. You will also find financial statements and
portfolio information for the Fund for the annual period ended December 31,
2019.
As always, we remain diligent in the management of your assets. If you have any
questions, or require additional information on this or other AIG Funds, we
invite you to contact your financial advisor or visit us at our website,
www.aig.com/funds. We value your ongoing confidence in us and look forward to
serving your investment needs in the future.
Sincerely,
/s/
Sharon French
President & CEO
SunAmerica Asset Management, LLC
--------
Past performance is no guarantee of future results.
* A basis point is 1/100/th/ of a percentage point.
** Dovish tends to suggest lower interest rates; opposite of hawkish.
+ Balance sheet normalization refers to the steps the Federal Reserve is
taking to reverse quantitative easing and remove the substantial monetary
accommodation it has provided to the U.S. economy since the financial crisis
began in 2007.
You could lose money by investing in the Fund. Although the Fund seeks to
preserve the value of your investment at $1.00 per share, it cannot guarantee
it will do so. An investment in the Fund is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
The Fund's sponsor has no legal obligation to provide financial support to the
Fund, and you should not expect that the sponsor will provide financial support
to the Fund at any time.
2
AIG Government Money Market Fund
AIG Government Money Market Fund (Class A) returned 1.21% for the annual
period ended December 31, 2019.
As money market yields moved lower and the yield curve ultimately flattened
during the annual period, the Fund struggled to find opportunities to purchase
higher yielding securities, adversely affecting its overall return. Still, the
Fund continued to seek current income to the extent consistent with liquidity
and stability of principal.
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. During the annual period, the Fund invested primarily in U.S.
government agency securities, with a focus on securities issued by
government-sponsored enterprises,/1/ including Federal Home Loan Bank, Fannie
Mae and Freddie Mac, as these securities offered higher yields than U.S.
Treasuries. As government agency securities generally outperformed U.S.
Treasuries during the annual period, the Fund's positioning boosted relative
results. However, a few agency holdings, namely those issued by Fannie Mae and
the Federal Farm Credit Bank, detracted from performance. We also invested in
Secured Overnight Financing Rate (SOFR)/2/-linked floating rate notes. These
notes had attractive yield levels, in our view, and SOFR either matched or beat
the effective funds rate through the annual period. Also, SOFR-linked floating
rate notes were longer-termed, i.e., between six- and 12-month maturities,
making them attractive as interest rates fell. The Fund also invested in
short-term U.S. Treasury bills and notes during the annual period. The Fund
does not invest in repurchase agreements and was therefore not affected by the
volatility in that market.
During the annual period, duration positioning played a key role in our
management strategy, and we sought to keep the Fund's duration longer on
average in anticipation of the Fed cutting interest rates. We were able to
navigate interest rate risk by adjusting the Fund's weighted average
maturity/3/ as market conditions shifted, methodically increasing the Fund's
weighted average maturity during the annual period by investing in longer-dated
SOFR-linked floating rate notes and other longer-dated securities to pick up
yield when we could. That said, as the money market yield curve flattened
during the annual period as a whole, we maintained a laddered investment
strategy./4/ This strategy enabled us to maintain liquidity and to take
advantage of attractively priced investment opportunities when available. The
Fund generally maintained a weighted average maturity in a range of between 10
to 20 days through the annual period, making adjustments based on then-current
market conditions, our near-term view on interest rates and anticipated and
actual Fed monetary policy statements. As of the end of the annual period, the
Fund's weighted average maturity stood at approximately 17 days. The Fund's
weighted average life/5/ on December 31, 2019 was 62 days.
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Past performance is no guarantee of future results.
1 A government-sponsored enterprise (GSE) consists of privately held
corporations with public purposes created by the U.S. Congress to reduce the
cost of credit for certain borrowing sectors of the economy.
2 SOFR is based on transactions in the U.S. Treasury repurchase market, where
banks and investors borrow or loan U.S. Treasuries overnight. Regulators,
including Fed Chair Powell, and several large banks are increasingly seeking
that this rate, introduced in April 2018, will eventually reduce markets'
dependence on LIBOR. LIBOR (London Inter-bank Offered Rate) is a benchmark
interest rate widely used as reference rates in bank, corporate and government
lending agreements.
3 Weighted average maturity (WAM) 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.
4 A laddered strategy involves holding securities of different maturity dates
rather evenly spaced across the money market yield curve.
5 The weighted average life of a money market fund is a measure of a money
market fund's price sensitivity to changes in liquidity and/or credit risk.
Under amendments to SEC Rule 2a-7 that became effective in May 2010, the
maximum allowable weighted average life of a money market fund is 120 days.
You could lose money by investing in the Fund. Although the Fund seeks to
preserve the value of your investment at $1.00 per share, it cannot guarantee
it will do so. An investment in the Fund is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
The Fund's sponsor has no legal obligation to provide financial support to the
Fund, and you should not expect that the sponsor will provide financial support
to the Fund at any time.
Securities listed may or may not be a part of current portfolio construction.
3
SunAmerica Money Market Funds, Inc.
EXPENSE EXAMPLE -- December 31, 2019 -- (unaudited)
Disclosure of Portfolio Expenses in Shareholder Reports
As a shareholder in the AIG 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. The 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, 2019 and
held until December 31, 2019.
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, 2019" to estimate the expenses you paid on your
account during this period. The "Expenses Paid During the Six Months Ended
December 31, 2019" 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, 2019" 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, 2019" 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. The "Expenses Paid During the Six Months Ended December 31, 2019"
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, 2019" 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,
2019" 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.
4
SunAmerica Money Market Funds, Inc.
EXPENSE EXAMPLE -- December 31, 2019 -- (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, 2019 December 31, 2019 December 31, 2019* as July 1, 2019 December 31, 2019 December 31, 2019* Ratio*
--------------- ----------------- ------------------ --------------- ----------------- ------------------ ----------
AIG
Government
Money
Market
Fund#
Class A.. $1,000.00 $1,005.44 $4.30 $1,000.00 $1,020.92 $4.33 0.85%
Class I.. $1,000.00 $1,005.69 $4.04 $1,000.00 $1,021.17 $4.08 0.80%
--------
* 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 365 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, 2019" and the "Annualized Expense Ratio" would have been
higher.
5
SunAmerica Money Market Funds, Inc.
STATEMENT OF ASSETS AND LIABILITIES -- December 31, 2019
AIG Government Money
Market Fund
--------------------
ASSETS:
Investments at value* (unaffiliated)............................... $192,236,606
Repurchase agreements (cost approximates value).................... 145,000
Cash............................................................... 885
Receivable for:
Fund shares sold................................................. 486,977
Dividends and interest........................................... 285,824
Prepaid expenses and other assets.................................. 23,863
Due from investment adviser for expense reimbursements/fee waivers. 1,219
Due from distributor for fee waivers............................... 23,070
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Total assets..................................................... 193,203,444
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LIABILITIES:
Payable for:
Fund shares redeemed............................................. 88,715
Investment advisory and management fees.......................... 81,781
Distribution and service maintenance fees........................ 23,071
Transfer agent fees and expenses................................. 70,186
Other accrued expenses........................................... 115,191
Distributions payable.............................................. 3,956
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Total liabilities................................................ 382,900
------------
Net Assets...................................................... $192,820,544
============
Common stock, $.001 par value (3.5 billion shares authorized)...... $ 192,663
Paid-in capital.................................................... 192,619,305
------------
192,811,968
Total accumulated earnings (loss).................................. 8,576
------------
Net assets...................................................... $192,820,544
============
Class A:
Net assets......................................................... 181,280,997
Shares outstanding................................................. 181,146,399
Net asset value and redemption price per share
(excluding any applicable contingent deferred sales charge)....... $ 1.00
============
Class I:
Net assets......................................................... 11,539,547
Shares outstanding................................................. 11,516,375
Net asset value and redemption price per share..................... $ 1.00
============
*Amortized cost of investment securities (unaffiliated)............ $192,236,606
============
See Notes to Financial Statements
6
SunAmerica Money Market Funds, Inc.
STATEMENT OF OPERATIONS -- For the year ended December 31, 2019
AIG Government Money
Market Fund
--------------------
INVESTMENT INCOME:
Interest (unaffiliated)................................................................ $3,884,258
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Total investment income............................................................. 3,884,258
----------
EXPENSES:
Investment advisory and management fees................................................ 907,905
Distribution and account maintenance fees
Class A.............................................................................. 255,093
Transfer agent fees and expenses
Class A.............................................................................. 527,536
Class I.............................................................................. 26,795
Registration fees
Class A.............................................................................. 39,216
Class I.............................................................................. 14,667
Custodian and accounting fees.......................................................... 25,006
Reports to shareholders................................................................ 61,861
Audit and tax fees..................................................................... 60,885
Legal fees............................................................................. 35,141
Directors' fees and expenses........................................................... 10,999
Other expenses......................................................................... 12,581
----------
Total expenses before fee waivers and expense reimbursements........................ 1,977,685
Fees waived and expenses reimbursed by investment adviser and distributor (Note 3).. (275,504)
----------
Net expenses........................................................................ 1,702,181
----------
Net investment income (loss)........................................................... 2,182,077
----------
Net realized gain (loss) on investments................................................ 1,856
----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS........................ $2,183,933
==========
See Notes to Financial Statements
7
SunAmerica Money Market Funds, Inc.
STATEMENT OF CHANGES IN NET ASSETS
AIG Government Money Market Fund
-------------------------------
For the year For the year
ended ended
December 31, December 31,
2019 2018
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss).................................................................. $ 2,182,077 $ 959,464
Net realized gain (loss) on investments....................................................... 1,856 (6,307)
------------ ------------
Net increase (decrease) in net assets resulting from operations................................ $ 2,183,933 $ 953,157
------------ ------------
Distributions to shareholders from:
Distributable earnings (Class A).............................................................. (2,026,927) (824,654)
Distributable earnings (Class I).............................................................. (156,098) (123,861)
------------ ------------
Total distributions to shareholders............................................................ (2,183,025) (948,515)
------------ ------------
Net increase (decrease) in net assets resulting from capital share transactions (Note 5)....... 37,887,281 37,895,583
------------ ------------
Total increase (decrease) in net assets........................................................ 37,888,189 37,900,225
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NET ASSETS:
Beginning of period............................................................................ 154,932,355 117,032,130
------------ ------------
End of period.................................................................................. $192,820,544 $154,932,355
============ ============
See Notes to Financial Statements
8
SunAmerica Money Market Funds, Inc.
FINANCIAL HIGHLIGHTS
AIG GOVERNMENT MONEY MARKET FUND
--------------------------------
Net Net Net Ratio of net
Asset Dividends Distributions Asset Assets Ratio of investment
Value Net from net from net Value end of expenses income to
beginning investment investment realized end of Total period to average average
Period Ended of period income(1) income gains period Return(2) (000's) net assets(3) net assets(3)
------------ --------- ---------- ---------- ------------- ------ --------- -------- ------------- -------------
Class A
-------
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
12/31/17 1.00 0.00 (0.00) (0.00) 1.00 0.04 105,422 0.86 0.02
12/31/18 1.00 0.01 (0.01) -- 1.00 0.77 142,844 1.03 0.78
12/31/19 1.00 0.01 (0.01) -- 1.00 1.21 181,281 0.95 1.19
Class I
-------
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
12/31/17 1.00 0.00 (0.00) (0.00) 1.00 0.15 11,610 0.75 0.12
12/31/18 1.00 0.01 (0.01) -- 1.00 1.02 12,089 0.80 1.02
12/31/19 1.00 0.01 (0.01) -- 1.00 1.37 11,540 0.80 1.36
--------
(1) Calculated based upon average shares outstanding.
(2) Total return includes expense reimbursements.
(3) Net of the following expense reimbursements/waivers (based on average net
assets):
12/31/15 12/31/16 12/31/17 12/31/18 12/31/19
-------- -------- -------- -------- --------
Class A............. 0.78% 0.57% 0.32% 0.15% 0.15%
Class I............. 0.71% 0.56% 0.27% 0.25% 0.18%
(4) The Fund's performance figure was increased by less than 0.01% from the
effect of payments by an affiliate
See Notes to Financial Statements
9
AIG Government Money Market Fund
PORTFOLIO PROFILE -- December 31, 2019 -- (unaudited)
Industry Allocation*
U.S. Government Agencies...... 70.6%
U.S. Government Treasuries.... 29.1
Repurchase Agreements......... 0.1
----
99.8%
====
Weighted average days to
maturity..................... 17.4
Credit Quality Allocation@#
P-1......................... 100.0%
=====
--------
* Calculated as a percentage of net assets
@ Source: Moody's
# Calculated as a percentage of total debt issues.
10
AIG Government Money Market Fund
PORTFOLIO OF INVESTMENTS -- December 31, 2019
Principal Value
Security Description Amount (Note 2)
SHORT-TERM INVESTMENT SECURITIES -- 99.7%
U.S. Government Agencies -- 70.6%
Federal Farm Credit Bank FRS 1.62%
(FEDL01 + 0.07%) due 04/03/2020... $ 4,000,000 $ 3,999,944
Federal Home Loan Bank 1.22% due
01/06/2020........................ 35,100,000 35,095,320
1.55% due 01/16/2020.............. 4,000,000 3,997,628
1.56% due 01/16/2020.............. 3,000,000 2,998,209
1.58% due 01/13/2020.............. 4,500,000 4,497,862
1.59% due 01/06/2020.............. 4,500,000 4,499,215
1.59% due 01/15/2020.............. 5,000,000 4,997,183
1.60% due 01/30/2020.............. 2,500,000 2,496,947
1.61% due 01/23/2020.............. 5,000,000 4,995,377
1.61% due 01/27/2020.............. 4,500,000 4,495,063
1.62% due 01/27/2020.............. 5,000,000 4,994,479
Federal Home Loan Bank FRS 1.62%
(SOFR + 0.08%) due 05/11/2020..... 5,000,000 5,000,000
1.67% (SOFR + 0.13%) due
10/16/2020...................... 4,000,000 4,000,000
1.69% (1 ML - 0.06%) due
01/14/2020...................... 2,000,000 1,999,985
Federal Home Loan Mtg. Corp.
FRS 1.54% (SOFR + 0.00%) due
04/13/2020........................ 3,000,000 3,000,000
1.55% (SOFR + 0.01%) due
02/21/2020...................... 5,500,000 5,500,000
1.55% (SOFR + 0.01%) due
05/13/2020...................... 3,000,000 3,000,000
1.55% (SOFR + 0.01%) due
05/20/2020...................... 4,000,000 4,000,000
1.55% (SOFR + 0.01%) due
07/22/2020...................... 4,000,000 4,000,000
1.55% (SOFR + 0.01%) due
08/07/2020...................... 5,000,000 5,000,000
1.56% (SOFR + 0.02%) due
02/28/2020...................... 4,500,000 4,500,065
1.56% (SOFR + 0.02%) due
06/05/2020...................... 5,000,000 5,000,000
1.57% (SOFR + 0.03%) due
06/02/2020...................... 5,000,000 5,000,000
1.57% (SOFR + 0.03%) due
06/17/2020...................... 5,000,000 5,000,000
1.58% (SOFR + 0.04%) due
04/03/2020...................... 4,000,000 4,000,000
------------
Total U.S. Government Agencies
(amortized cost $136,067,277)..... 136,067,277
------------
U.S. Government Treasuries -- 29.1%
United States Treasury Bills 1.48%
due 02/25/2020.................... 2,000,000 1,995,628
1.49% due 02/18/2020.............. 3,400,000 3,393,386
1.51% due 01/21/2020.............. 4,000,000 3,996,818
1.52% due 01/02/2020.............. 4,500,000 4,500,000
1.52% due 01/21/2020.............. 1,800,000 1,798,562
1.52% due 01/21/2020.............. 3,000,000 2,997,597
1.53% due 01/07/2020.............. 3,000,000 2,999,364
Principal Value
Security Description Amount (Note 2)
-----------------------------------------------------------------------
United States Treasury Bills (continued)
1.54% due 01/28/2020......................... $2,500,000 $ 2,497,228
1.55% due 01/21/2020......................... 5,000,000 4,995,907
1.57% due 01/21/2020......................... 2,000,000 1,998,348
United States Treasury Notes
1.13% due 03/31/2020.......................... 4,500,000 4,495,702
1.13% due 04/30/2020......................... 4,500,000 4,494,122
1.38% due 02/15/2020......................... 8,000,000 7,998,131
2.00% due 01/31/2020......................... 5,000,000 5,001,632
3.63% due 02/15/2020......................... 3,000,000 3,006,904
------------
Total U.S. Government Treasuries
(amortized cost $56,169,329)................. 56,169,329
------------
Total Short-Term Investment Securities -- 99.7%
(amortized cost $192,236,606)................ 192,236,606
------------
REPURCHASE AGREEMENTS -- 0.1%
Agreement with Fixed Income Clearing Corp.,
bearing interest at 0.25%, dated
12/31/2019, to be repurchased 01/02/2020
in the amount of $145,002, collateralized
by $145,000 of United State Treasury
Notes, bearing interest at 2.75% due
09/15/2021 and having an approximate
value of $148,944. (cost $145,000).......... 145,000 145,000
------------
TOTAL INVESTMENTS
(amortized cost $192,381,606)(1)............. 99.8% 192,381,606
Other assets less liabilities.................. 0.2 438,938
---------- ------------
NET ASSETS..................................... 100.0% $192,820,544
========== ============
--------
(1) At December 31, 2019, 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, 2019 and
unless noted otherwise, the dates shown are the original maturity dates.
Index Legend
1 ML --1 Month USD LIBOR
FEDL01 --U.S. Federal Funds Effective Rate
SOFR --Secured Overnight Financing Rate
The following is a summary of the inputs used to value the Fund's net assets as
of December 31, 2019 (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... $-- $192,236,606 $-- $192,236,606
Repurchase Agreements.............. -- 145,000 -- 145,000
--- ------------ --- ------------
Total Investments at Value......... $-- $192,381,606 $-- $192,381,606
=== ============ === ============
--------
* For a detailed presentation of investments, please refer to the Portfolio of
Investments.
See Notes to Financial Statements
11
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2019
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 -- AIG Government Money
Market Fund (the "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. It does this 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, 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 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
12
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2019 -- (continued)
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, 2019, is reported on a schedule at the
end of 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
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
13
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2019 -- (continued)
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.
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.
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.
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 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
2016 - 2018 or expected to be taken in the Fund's 2019 tax return. The Fund
is not
14
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2019 -- (continued)
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
2016.
LIBOR Risk: A fund's investments, payment obligations and financing terms
may be based on floating rates, such as London Interbank Offer Rate
("LIBOR"), Euro Interbank Offered Rate and other similar types of reference
rates (each, a "Reference Rate"). On July 27, 2017, the Chief Executive of
the UK Financial Conduct Authority ("FCA"), which regulates LIBOR, announced
that the FCA will no longer persuade nor require banks to submit rates for
the calculation of LIBOR and certain other Reference Rates after 2021. Such
announcement indicates that the continuation of LIBOR and other Reference
Rates on the current basis cannot and will not be guaranteed after 2021.
This announcement and any additional regulatory or market changes may have
an adverse impact on a fund or its investments.
In advance of 2021, regulators and market participants will work together to
identify or develop successor Reference Rates. Additionally, prior to 2021,
it is expected that market participants will focus on the transition
mechanisms by which the Reference Rates in existing contracts or instruments
may be amended, whether through market wide protocols, fallback contractual
provisions, bespoke negotiations or amendments or otherwise. Nonetheless,
the termination of certain Reference Rates presents risks to a fund. At this
time, it is not possible to completely identify or predict the effect of any
such changes, any establishment of alternative Reference Rates or any other
reforms to Reference Rates that may be enacted in the UK or elsewhere. The
elimination of a Reference Rate or any other changes or reforms to the
determination or supervision of Reference Rates could have an adverse impact
on the market for or value of any securities or payments linked to those
Reference Rates and other financial obligations held by a fund or on its
overall financial condition or results of operations. In addition, any
substitute Reference Rate and any pricing adjustments imposed by a regulator
or by counterparties or otherwise may adversely affect a fund's performance
and/or NAV.
New Accounting Pronouncements: In August 2018, the FASB issued Accounting
Standards Update ("ASU") No. 2018-13 "Disclosure Framework -- Changes to the
Disclosure Requirements for Fair Value Measurement". The ASU eliminates,
modifies, and adds disclosure requirements for fair value measurements and
is effective for fiscal years, and interim periods within those fiscal
years, beginning after December 15, 2019. The ASU allows for early adoption
of either the entire standard or only the provisions that eliminate or
modify the requirements. Management has elected to early adopt the
provisions that eliminate disclosure requirements and is still evaluating
the impact of applying the rest of the ASU.
Effective January 1, 2019, the Fund is subject to ASU 2017-08, "Premium
Amortization on Purchased Callable Debt Securities", which requires the
premiums on certain purchased debt securities with non-contingent call
features to be amortized to the earliest call date. The amortization period
for callable debt securities purchased at a discount is not impacted.
Adoption of the ASU had no impact on the Fund.
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.
15
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2019 -- (continued)
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 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, 2019,
pursuant to the contractual expense limitations, SunAmerica waived fees
and/or reimbursed expenses of $20,411 for Class I.
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, 2019,
SunAmerica did not voluntarily waive expenses.
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. In light of
current market conditions, 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, 2019, ACS voluntarily waived $255,093 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, 2019,
the proceeds received from redemptions are as follows:
Class A............................ $21,732
The Fund has entered into a Service Agreement with AIG Fund Services, Inc.
("AFS"), an affiliate of the Adviser. Under the Service Agreement, AFS
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 AFS 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, 2019, 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 AFS pursuant to the terms of the
Service Agreement:
Payable at
Expenses December 31, 2019
-------- -----------------
Class A............................ $371,268 $33,837
Class I............................ 25,342 2,147
16
SunAmerica Money Market Funds, Inc.
NOTES TO FINANCIAL STATEMENTS -- December 31, 2019 -- (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
---------------------------------------- ---------------------------------------------------------------------------
For the year ended December 31, 2019 For the year ended December 31, 2019 For the year ended December 31, 2018
---------------------------------------- ------------------------------------- -------------------------------------
Long-term Gains/ Unrealized Long-Term Long-Term
Ordinary Capital and Appreciation Ordinary Capital Ordinary Capital
Income Other Losses (Depreciation) Income Gains Income Gains
-------- ---------------- -------------- ----------- --------- --------- ---------
$13,033 $(4,453) $ -- $2,183,025 $ -- $948,515 $ --
Capital Loss Carryforwards: At December 31, 2018 for Federal income tax
purposes, the Fund has $4,453 of unlimited short-term capital losses.
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 ended year ended year ended year ended
December 31, December 31, December 31, December 31,
2019 2018 2019 2018
------------ ------------ ------------ ------------
Shares sold.............. $107,732,124 $ 82,114,138 $ 11,776,452 $ 14,997,048
Reinvested dividends..... 2,016,630 818,432 155,439 123,269
Shares redeemed.......... (71,312,308) (45,515,814) (12,481,056) (14,641,490)
------------ ------------ ------------ ------------
Net increase (decrease).. $ 38,436,446 $ 37,416,756 $ (549,165) $ 478,827
============ ============ ============ ============
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, 2019, the Fund did
not participate in this program.
17
SunAmerica Money Market Funds, Inc.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of SunAmerica Money Market Funds, Inc. and
Shareholders of AIG Government Money Market Fund
Opinion on the Financial Statements
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of AIG Government Money Market Fund (the "Fund")
as of December 31, 2019, the related statement of operations for the year ended
December 31, 2019, the statement of changes in net assets for each of the two
years in the period ended December 31, 2019, including the related notes, and
the financial highlights for each of the five years in the period ended
December 31, 2019 (collectively referred to as the "financial statements"). In
our opinion, the financial statements present fairly, in all material respects,
the financial position of the Fund as of December 31, 2019, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period ended December 31, 2019 and the financial
highlights for each of the five years in the period ended December 31, 2019 in
conformity with accounting principles generally accepted in the United States
of America.
Basis for Opinion
These financial statements are the responsibility of the Fund's management. Our
responsibility is to express an opinion on the Fund's financial statements
based on our audit. We are a public accounting firm registered with the Public
Company Accounting Oversight Board (United States) ("PCAOB") and are required
to be independent with respect to the Fund in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audits of these financial statements in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in
the financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements. Our procedures
included confirmation of securities owned as of December 31, 2019 by
correspondence with the custodian and brokers; when replies were not received
from brokers, we performed other auditing procedures. We believe that our
audits provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
February 26, 2020
We have served as the auditor of one or more investment companies in the AIG
Funds family of funds since 1984.
18
SunAmerica Money Market Funds, Inc.
DIRECTORS AND OFFICERS INFORMATION -- December 31, 2019 -- (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. Unless otherwise noted, the address of each Director
and executive officer is Harborside 5, 185 Hudson Street, Suite 3300, Jersey
City, NJ 07311.
Number of
Position Term of Portfolios in
Name, Held With Office and Fund Complex
Address and SunAmerica Length of Principal Occupations Overseen by Other Directorships
Age Complex Time Served(4) During Past 5 Years Trustee(1) Held by Trustee(2)
--------------------- ---------- -------------- ----------------------------- ------------- -----------------------------
Disinterested Directors
Dr. Judith L. Craven Trustee 2001-present Retired. 73 Director, A.G. Belo
Age: 73 Corporation (a media
company) (1992-2014);
Director, Sysco Corp. (1996
to 2017); Director, Luby's,
Inc. (1998 to present).
Richard W. Grant Trustee 2011-present Retired. 24 None
Age: 73 Chairman
of the
Board
Stephen J. Gutman Trustee 1984-present Senior Vice President and 24 None
Age: 76 Associate Broker, Corcoran
Group (real estate) (2002 to
present); President, SJG
Marketing Inc. (2009 to
present).
Eileen A. Kamerick Trustee 2018-present National Association of 24 Hochschild Mining plc
Age 60 Corporate Directors Board (precious metals company)
Leadership Fellow and (since 2016); Director of
financial expert; Adjunct Associated Banc-Corp
Professor of Law, University (financial services company)
of Chicago, Washington (since 2007); Legg Mason
University in St. Louis and Closed End Funds
University of Iowa law (registered investment
schools (since 2007); companies) (since 2013);
formerly, Senior Advisor to Westell Technologies, Inc.
the Chief Executive Officer (technology company)
and Executive Vice President (2003-2016).
and Chief Financial Officer
of ConnectWise, Inc.
(software and services
company) (2015-2016); Chief
Financial Officer, Press
Ganey Associates (health care
informatics company)
(2012-2014)
Interested Director
Peter A. Harbeck(3) Trustee 2001-present Retired June 2019; formerly 73 None
Age: 66 President, CEO (1997 to
2019), and Director (1992 to
2019), SunAmerica; Director,
AIG Capital Services, Inc.
("ACS") (1993 to 2019);
Chairman, President and CEO,
Advisor Group, Inc. (2004 to
2016).
--------
(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 (6 funds),
SunAmerica Equity Funds (2 funds), SunAmerica Income Funds (3 funds),
SunAmerica Series, Inc. (6 funds), Anchor Series Trust (5 portfolios),
SunAmerica Senior Floating Rate Fund, Inc. (1 fund), SunAmerica Series
Trust (60 portfolios), VALIC Company I (34 portfolios), VALIC Company II
(15 funds), Seasons Series Trust (19 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) Mr. Harbeck is considered to be an Interested Trustee because he owns
shares of American International Group, Inc. the ultimate parent of the
Adviser. Until his retirement on June 28, 2019, he served as President, CEO
& Director of SunAmerica and Director of ACS.
(4) Trustees serve until their successors are duly elected and qualified.
Additional information concerning the Trustees is contained in the Statement of
Additional Information which is available, without charge, by calling
(800) 858-8850.
19
SunAmerica Money Market Funds, Inc.
DIRECTORS AND OFFICERS INFORMATION -- December 31, 2019 -- (unaudited)
(continued)
Position Term of
Name, Held With Office and
Address and SunAmerica Length of Principal Occupations During Past
Age Complex Time Served(4) 5 Years
--------------------- -------------------- -------------- ----------------------------------
Officers
John T. Genoy President 2007- Chief Financial Officer,
Age: 51 present SunAmerica (2002 to present);
Senior Vice President, SunAmerica
(2004 to present); Chief Operating
Officer, SunAmerica (2006
to present).
Sharon French Executive 2019- President and CEO of SunAmerica
Age: 54 Vice present (since 2019); Vice President of
President AIG (since 2019); Executive Vice
President and Head of Beta
Solutions, OppenheimerFunds
(2016-2019); President, F-Squared
Capital, LLC (financial services)
(2013-2015).
Gregory N. Bressler Secretary 2005- Senior Vice President and General
Age: 53 present Counsel, SunAmerica (2005 to
present).
Kathleen D. Fuentes Chief Legal 2013- Vice President and Deputy General
Age: 50 Officer and present Counsel, SunAmerica (2006 to
Assistant Secretary present).
James Nichols Vice President 2006- Director, President and CEO, ACS
Age: 53 present (2006 to present); Senior Vice
President, SunAmerica (2002 to
present).
Gregory R. Kingston Treasurer 2014- Vice President, SunAmerica (2001
Age: 53 present to present); Head of Mutual Fund
Address: Administration, SunAmerica (2014
2919 Allen Parkway to present).
Houston, Texas 77019
Shawn Parry Vice President and 2014- Vice President, SunAmerica (2014
Age: 47 Assistant Treasurer present to present); Assistant Vice
Address: President, SunAmerica (2005 to
2919 Allen Parkway 2014).
Houston, Texas 77019
Donna McManus Vice President and 2014- Vice President, SunAmerica, (2014
Age: 58 Assistant Treasurer present to present); Managing Director,
BNY Mellon (2009 to 2014).
Timothy Pettee Vice President 2018- Lead Portfolio Manager, Rules
Age: 60 present Based Funds (2013-present); Chief
Investment Strategist
(2003-present); Chief Investment
Officer, SunAmerica (2003-2013).
Christopher C. Joe Chief Compliance 2017- Chief Compliance Officer, AIG
Age: 50 Officer present Funds, Anchor Series Trust,
Address: Seasons Series Trust, SunAmerica
2919 Allen Parkway Series Trust, VALIC Company I and
Houston, Texas 77019 VALIC Company II (2017 to
present); Chief Compliance
Officer, VALIC Retirement Services
Company (2017 to present); Chief
Compliance Officer, Invesco
PowerShares (2012 to 2017); Chief
Compliance Officer, Invesco
Investment Advisers, LLC (2010 to
2013); U.S. Compliance Director,
Invesco Ltd. (2006 to 2014);
Deputy Chief Compliance Officer,
Invesco Advisers, LLC (2014 to
2015).
Matthew J. Hackethal Anti-Money 2006- Acting Chief Compliance Officer,
Age: 47 Laundering ("AML") present AIG Funds, Anchor Series Trust,
Compliance Officer Seasons Series Trust, SunAmerica
Series Trust, VALIC Company I and
VALIC Company II (2016 to 2017);
Chief Compliance Officer,
SunAmerica (2006 to Present); AML
Compliance Officer, AIG Funds,
Anchor Series Trust, Seasons
Series Trust, SunAmerica Series
Trust, VALIC Company I and VALIC
Company II (2006 to Present) and
Vice President, SunAmerica (2011
to Present).
20
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, 2019. The information necessary to complete your income
tax returns is included with your Form 1099-DIV, which will be mailed to you in
early 2020.
21
[LOGO]
AIG Funds
Harborside 5
185 Hudson Street, Suite 3300
Jersey City, NJ 07311
Directors/Trustees VOTING PROXIES ON FUND DISCLOSURE OF MONTHLY
Dr. Judith L. Craven PORTFOLIO SECURITIES PORTFOLIO HOLDINGS
Richard W. Grant A description of the The Fund is required to
Stephen J. Gutman policies and procedures file its complete
Peter A. Harbeck that the Funds use to schedule of portfolio
Eileen A. Kamerick determine how to vote holdings with the U.S.
Officers proxies relating to Securities and Exchange
John T. Genoy, President securities held in the Commission monthly on
and Chief Executive Funds' portfolios which Form N-MFP. The Fund's
Officer is available in the Forms N-MFP are available
Sharon French, Executive Funds' Statement of on the U.S. Securities
Vice President Additional Information and Exchange Commission's
Timothy Pettee, Vice may be obtained without website at
President charge upon request, by http://www.sec.gov. The
Gregory R. Kingston, calling (800) 858-8850. Fund also posts its
Treasurer This information is also monthly portfolio
James Nichols, Vice available from the EDGAR holdings on its website
President database on the U.S. at
Gregory N. Bressler, Securities and Exchange http://www.aig.com/funds.
Secretary Commission's website at PROXY VOTING RECORD ON
Kathleen Fuentes, Chief http://www.sec.gov. FUND PORTFOLIO SECURITIES
Legal Officer and DELIVERY OF SHAREHOLDER Information regarding how
Assistant Secretary DOCUMENTS the Funds voted proxies
Donna McManus, Vice The Funds have adopted a relating to securities
President and policy that allows them held in the Fund's
Assistant Treasurer to send only one copy of portfolio during the most
Shawn Parry, Vice a Fund's prospectus, recent twelve month
President and proxy material, annual period ended June 30 is
Assistant Treasurer report and semi-annual available, once filed
Matthew J. Hackethal, report (the "shareholder with the U.S. Securities
Anti-Money Laundering documents") to and Exchange Commission,
Compliance Officer shareholders with without charge, upon
Christopher C. Joe, multiple accounts request, by calling (800)
Chief Compliance residing at the same 858-8850 or on the U.S.
Officer "household." This Securities and Exchange
Investment Adviser practice is called Commission's website at
SunAmerica Asset householding and reduces http://www.sec.gov.
Management, LLC Fund expenses, which This report is submitted
Harborside 5 benefits you and other solely for the general
185 Hudson Street, Suite shareholders. Unless the information of
3300 Funds receive shareholders of the Fund.
Jersey City, NJ 07311 instructions to the Distribution of this
Distributor contrary, you will only report to persons other
AIG Capital Services, receive one copy of the than shareholders of the
Inc. shareholder documents. Fund is authorized only
Harborside 5 The Funds will continue in connection with a
185 Hudson Street, Suite to household the currently effective
3300 shareholder documents prospectus, setting forth
Jersey City, NJ 07311 indefinitely, until we details of the Fund,
Shareholder Servicing are instructed otherwise. which must precede or
Agent If you do not wish to accompany this report.
AIG Fund Services, Inc. participate in
Harborside 5 householding, please
185 Hudson Street, Suite contact Shareholder
3300 Services at
Jersey City, NJ 07311 (800) 858-8850 ext. 6010
Transfer Agent or send a written request
DST Asset Manager with your name, the name
Solutions, Inc. of your fund(s) and your
303 W. 11/th/ Street account member(s) to AIG
Kansas City, MO 64105 Funds, P.O. Box 219186,
Custodian Kansas City MO,
State Street Bank and 64121-9186. We will
Trust Company resume in-dividual
One Lincoln St. mailings for your account
Boston, MA 02111 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.aig.com/funds
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.aig.com/funds 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.
AIG Funds are advised by SunAmerica Asset Management, LLC (SAAMCo) and
distributed by AIG Capital Services, Inc. (ACS), Member FINRA. Harborside 5,
185 Hudson Street, Suite 3300, Jersey City, NJ 07311, 800-858-8850. SAAMCo and
ACS are members of American International Group, Inc. (AIG).
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
AIG Funds Sales Desk at 800-858-8850, ext. 6003, or at aig.com/funds. Read the
prospectus carefully before investing.
[LOGO]
aig.com/funds
MMANN - 12/19
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 (the "Code"). During the fiscal year ended December 31, 2019,
there were no reportable waivers or implicit waivers to a provision of
the Code that applies to the registrant's Principal Executive and
Principal Accounting Officers (the "Covered Officers"). During the
fiscal year ended December 31, 2019, however, the Code has been
amended to reflect changes to the titles of the Covered Officers.
Item 3. Audit Committee Financial Expert.
The registrant's Board of Directors has determined that Eileen A.
Kamerick, a Director of the registrant, qualifies as an audit
committee financial expert, as defined in Item 3(b) of Form N-CSR. Ms.
Kamerick is considered to be "independent" for purposes of Item
3(a)(2) of Form N-CSR.
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:
2018 2019
(a) Audit Fees................................. $47,363 $48,784
(b) Audit-Related Fees......................... $ 0 $ 0
(c) Tax Fees................................... $12,603 $13,750
(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:
2018 2019
(b) Audit-Related Fees.................... $ 0 $0
(c) Tax Fees.............................. $ 0 $0
(d) All Other Fees........................ $36,429 $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 2018 and 2019 were $117,603 and $13,750 respectively.
(h) Non-audit services rendered to the registrant's investment adviser and
any Adviser Affiliates that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii)
of Rule 2-01 of Regulation S-X were considered by the registrant's
audit committee as to whether they were compatible with maintaining
the principal accountant's independence.
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
most recent fiscal half year that has materially affected, or is
reasonably likely to materially affect, the registrant's internal
control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management
Investment companies.
Not Applicable.
Item 13. 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.
(4) 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, 2020
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, 2020
By: /s/ Gregory R. Kingston
--------------------------
Gregory R. Kingston
Treasurer
Date: March 9, 2020