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investigate and reconfirm the pool’s compliance with items listed aboveand shall <br />monitor the pool’s performance reports. <br />11.0COLLATERALIZATION/SECURITY FOR DEPOSIT OF PUBLIC FUNDS <br />Money must be deposited in state or national banks, state or federal savings associations <br />or state or federal credit unions in the State of California. It may be in inactive deposits, <br />active deposits or interest-bearing active deposits. The deposits cannot exceed the <br />amount of the bank's or savings and loan's paid up capital and surplus. <br />The bank or savings and loan must secure the active and inactive deposits with eligible <br />securities having a market value of one-hundred, ten percent (110%) of the total amount of <br />the deposits. State law also allows as an eligible security, first trust deeds having a value <br />of one-hundred, fifty percent (150%) of the total amount of the deposits. A third class of <br />collateral is letters of credit drawn on the Federal Home Loan Bank (FHLB). <br />The Treasurer may waive, at his discretion, security for that portion of a deposit which is <br />insured pursuant to federal law. Currently, the first two-hundred, fifty-thousand dollars <br />($250,000) of a deposit is federally insured. It is to the City's advantage to waive this <br />collateral requirement for the first $250,000 because we receive a higher interest rate. <br />12.0SAFEKEEPINGANDCUSTODY <br />12.1Perfected Interest and Delivery versus Payment <br />In accordance with California Government Code Section 53601, to protect against <br />potential losses caused by collapse of individual securities dealers, all securities owned by <br />the City except securities used as collateral for repurchase agreements, shall be kept in <br />safekeeping with "perfected interest"by the City’s custodial bank or a third party bank trust <br />department, acting as agent for the City under the terms of a custody agreement executed <br />by the bank and by the City. Perfected interest refers toestablishment of a superior <br />ownership right in and legal control over the securities assets held by the bank <br />custodian on the City’sbehalf and isintended to protect the City from the custodial <br />bank’s own creditors in the event of abank default and filing for bankruptcy.All <br />securities, excepting investments which are not deliverable (such as LAIF, direct time <br />certificates of deposit, and money market mutual funds),will be received and delivered <br />using standard “delivery versus payment”.Delivery versus payment refers todelivery of <br />securities with an exchange of money for the securitiesat the time of delivery,rather <br />thandelivery of securities with an exchange of a signed receipt for the securities. <br />*´«¸ ΐǾ ΑΏΐ9- <br />C¨³¸ ®¥ 3 ­³  ȃ !­­´ « <br />0 ¦¤ 16 <br />3³ ³¤¬¤­³ ®¥ )­µ¤²³¬¤­³ 0®«¨¢¸*´­¤ ΒΏǾ ΑΏ20 <br /> <br />