diff --git a/lib/tokenize.cpp b/lib/tokenize.cpp
index 6e461958b..411c95535 100644
--- a/lib/tokenize.cpp
+++ b/lib/tokenize.cpp
@@ -1621,7 +1621,6 @@ void Tokenizer::simplifyTemplates()
         for (std::list<Token *>::iterator iter1 = templates.begin(); iter1 != templates.end(); ++iter1)
         {
             Token *tok = *iter1;
-
             std::vector<std::string> type;
             for (tok = tok->tokAt(2); tok && tok->str() != ">"; tok = tok->next())
             {
@@ -1635,11 +1634,11 @@ void Tokenizer::simplifyTemplates()
 
             // if this is a template function, get the position of the function name
             unsigned int pos = 0;
-            if (Token::Match(tok, "> %type% *| %var% ("))
+            if (Token::Match(tok, "> %type% *|&| %var% ("))
                 pos = 2;
-            else if (Token::Match(tok, "> %type% %type% *| %var% ("))
+            else if (Token::Match(tok, "> %type% %type% *|&| %var% ("))
                 pos = 3;
-            if (pos > 0 && tok->tokAt(pos)->str() == "*")
+            if (pos > 0 && (tok->tokAt(pos)->str() == "*" || tok->tokAt(pos)->str() == "&"))
                 ++pos;
 
             if (_settings && _settings->_debug)
diff --git a/test/testsimplifytokens.cpp b/test/testsimplifytokens.cpp
index c89a8410b..04b6bf27a 100644
--- a/test/testsimplifytokens.cpp
+++ b/test/testsimplifytokens.cpp
@@ -96,6 +96,7 @@ private:
         TEST_CASE(template16);
         TEST_CASE(template17);
         TEST_CASE(template18);
+        TEST_CASE(template19);
         TEST_CASE(template_default_parameter);
         TEST_CASE(template_default_type);
         TEST_CASE(template_typename);
@@ -1508,6 +1509,26 @@ private:
         ASSERT_EQUALS(expected, sizeof_(code));
     }
 
+    void template19()
+    {
+        const char code[] = "template <typename T> T & foo()\n"
+                            "{ static T temp; return temp; }\n"
+                            "\n"
+                            "void f ( )\n"
+                            "{\n"
+                            "    char p = foo<char>();\n"
+                            "}\n";
+
+        // The expected result..
+        const std::string expected("; "
+                                   "void f ( ) "
+                                   "{"
+                                   " char p ; p = foo<char> ( ) ; "
+                                   "} "
+                                   "char & foo<char> ( ) { static char temp ; return temp ; }");
+        ASSERT_EQUALS(expected, sizeof_(code));
+    }
+
     void template_default_parameter()
     {
         {