It could have been worse.

That's one sentiment you get when perusing the SeekingAlpha's transcript of Friday's conference call between Federated Investors CEO Chris Donahue and his colleagues with ten analysts on 2014's second quarter earnings.

To-be-sure, nobody at Federated was delighted at the reform proposal, notably the implementation of a floating NAV for institutional prime and institutional muni money funds, as well as the related tax compliance issues. The looming specter of these reforms, as well as the blah interest rate environment, made Federated money-market fund assets dip by 15 billion from the previous quarter. Moreover, Federated's market share at the end of the latest quarter was down by one percent, to 8.3 percent, from a year ago.

However, the SEC's reform proposal released last weekcame with virtually no surprises, affording Federated and the other players in the market with some certainty now to take action. And they are not without options.

Among the many themes to be found in the SeekingAlpha's transcript of the conversation between Donahue and his colleagues with industry analysts, three stood out. They are:

1. Federated Has Other Stuff Going on Besides Money Funds
Make no mistake, money funds are important to Federated, accounting for roughly $211 billion in assets out the firm's roughly total $350 billion, but the firm also has roughly $50 billion in equities and $56 billion in fixed income.

Fixed income was down somewhat, but equities had a solid second quarter. Equity fund gross sales were up 12 percent from the previous quarter and net sales more than the doubled for the second straight quarter. Equities accounted for 44 precent of the firm's second quarter revenues.

Performance was a big driver for the flows. For example, the firm's MDT STock Trust fund was the number one rated, out of over 1,000 products, in Morningstar's large value category. Half of the firm's equity strategies were top quartile for the trailing three-years at quarter end, while 80 percent were in the top half for the same period.

2. Nobody, Including Clients, Are Panicking
During the conference call, Donahue and Debbie Cunningham, CIO of Federated Money Markets said they had a call with 700 clients they day before and the prevailing message was "you have got a two-year implementation, nothing changes now." Most clients, they said, understood that they had time to digest the reforms and adapt. 3. Federated Has Plenty on the Drawing Board
Among the product ideas discussed by Donahue and his colleagues were: privately-placed money-market funds; various flavors of SMAs; 60-day duration and under prime funds, and selective funds, with a heavy capital preservation element for retirement accounts. 

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