2003-056 - Considering the City's Statement of Investment Policy

Home Browse Search

CITY OF SAC'fA ANA STATES,let OF iNn;E~NT POLICY JULy ~003-- 2004 C~vernment Sponsored Ente~rise. Federal Agency Issues ~nelude, but are not limited to ~ (Government National Mortgage Association), FFCB (Federal Farm Credit Bank), FHLB (Federal ~ome Loan Bank Board), FHLMC (Federal Home Loan Mortgage Corporation), FNMA (Federal National Mortgage Association), SL~A (Student Loan Marketing Administration), FHA Authority), Although there ia no percentage li~itation on these issues, the "prudent investor" rule shall apply for a single agency name as U.S. Government backin~ is implied rather than guaranteed. Bills of exchange or time drafts drawn on and accepted by a commercial bank, otherwise ~nown as banker's acceptances, which are eligible for purchase by the Federal Reserve System. Purchases of banker's a~eep%ances may no~ exc%ed 1~0 d~ys or ~0 percent cf the cost value of the Fund which may be invested pursuant to this section. However, no more than 30 percent of the City's cost va!u~ of the ~und ~y be invested in the bankers acceptances of any one cormnercial bank pursuant to this sectfon~ Commercial paper of '~prime" quality of the highest ra~<ing or of the highest ]etter and number rating as provided for by Moody's Investor Services, Inc, {Moody's), Star~rd and ~oor's (s&P)or Fitch Financial Services, Inc. (Fitch). The corporation that issues the c~lercial paper shall be organized and operating within the United States, shall have total assets in excess of five h~ndred million dollars ($500~000,000), and shall issue debt, other than co~%~ercial paper, if any, that is rated "A" or higher by Moody's or S&P or Fitch. Eligible commercial paper shall have a maximum maturity of 270 days or le~s. The City may purchase no more than 101 of the outsta~din9 cormn, ercial paper of any single co.~porate issue. Purchases of commercial paper may not exceed 25 percent of ~he surplus money which may be invested. Negotiable certiCicates of deposit i~sued by a nationally or state-chartered bank, a savings association or a federal association (as defined by Section 5102 of the Financ]a] Code}, a state or federal credit %u~ion or by a state-licensed branch of a ~oreign bank. Mowever, the City shall not inves: in negotiable certificates of deposit issued by a state o~ federal credit union if a me~er of the City Council or any Cisy personnel with investment decision making authority also serves on the board of directors, or any coT. mitres appointed by the board of directors, or the Trediu co~lit~ee or the supervisory committee of the s~ate or federal credit union issuing the negotiable certif!cates of deposit. The City's investment in negotiable certificates of deposit may not exceed 30 percent of the cost value of the Fund. The amount so invested shall be subjec~ to tb.e limitations of Government C. ode Section 53638 which generally provides that the deposit Resolution No. 2003-056 Page 7 of 11