After just nine months in operation the Bank of Bermuda Ltd.'s Bermuda Institutional Money Fund has grown to $1.275 billion as at Wednesday.

The fund was set up nine months ago for institutions and high net worth individuals looking for liquidity and competitive interest rates. For example mutual funds use such low-risk money market instruments for short periods while managers decide where to invest. Since January 14 the fund has had a return of 5.43 percent. By comparison the overnight deposit rate has returned 5.2 percent, and the Standard & Poor's money fund index has had a return of 5.06 percent.

Bank of Bermuda portfolio manager Faith Outerbridge said the aim was to offer a low-risk product that gave a competitive return. Moody's Investors Service rates the fund "Aaa''. Minimal initial investment is $5 million.

Faith Outerbridge