Charles Schwab seeks OK to reorganize two California municipal funds

By Toni Weeks

San Luis Obispo, Calif., July 10 – The board of trustees of the Charles Schwab Family of Funds announced it has approved the reorganization of the Schwab California AMT Tax-Free Money Fund into the Schwab California Municipal Money Fund, according to an N-14 filing with the Securities and Exchange Commission.

The board said that the reorganization will combine a smaller fund into a larger fund and that shareholders could potentially benefit by the growth in assets and economies of scale, including the ability to spread some fixed costs across a larger asset base.

In addition, the advisory fee rate payable by the surviving fund is lower than that currently payable by the acquired fund.

Approval from shareholders of record as of July 2 is being sought at a meeting on Sept. 25. If the proposal is approved, the reorganization will take place Sept. 26.

San Francisco-based Charles Schwab Investment Management, Inc. serves as the investment adviser to both funds.

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