US money manager  Legg Mason is making further moves to bail out more money market funds that made risky investments and expects to take a cumulative quarterly charge of $154.5 million for the bailouts, according to Reuters.

The development underscores how the losses sustained by money market funds have damaged the notion that such products are always low-risk or similar to cash. Some of these funds have invested in credit products that have been hit by the sudden spike in short-term borrowing costs.

Legg Mason, the second-biggest publicly traded US asset manager, said it has pledged capital support for three money market funds of a subsidiary that were hurt by exposure to risky asset-backed securities and weak markets in June.

It will contribute up to $240 million to the funds if any of the funds realise a loss on the sale, or certain other events, relating to asset-backed commercial paper securities, Legg Mason said.

Legg Mason has already pledged support to its money market funds several times to shield investors from the losses since the credit crisis hit last year. It took a charge of $291 million for the quarter ended 31 March for bailing out the funds, leading to its first-ever loss.

The firm said it expects to take a charge of $90.1 million net of taxes for the fiscal first quarter ended June 30 for extending support to the three funds.