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CITY OF SANTA ANA STATEMENT OF INVESTMENT POLICY <br />JULY 2015 -2016 <br />Page 5 <br />Code Section 53638 which generally provides that the deposit shall not exceed the <br />shareholder's equity of any depository bank, or the total net worth of any depository <br />savings association or federal association, or the total of the unimpaired capital and <br />surplus of an insured industrial loan company. <br />F. Repurchase Agreements. For purposes of this section, the term "repurchase agreement" <br />means a purchase of securities by the local agency pursuant to an agreement by which <br />the seller will repurchase the securities on or before a specified date and for a specified <br />amount and will deliver the underlying securities to a third -party custodian. The City may <br />invest in repurchase agreements with primary dealers of the Federal Reserve with which <br />the City has entered into a Securities Industry and Financial Markets Association <br />(SIFMA) Master Repurchase Agreement (MRA) which specifies terms and conditions of <br />repurchase agreements. The market value of securities used as collateral for repurchase <br />agreements shall not be allowed to fall below one hundred two percent (102 %) of the <br />value of the repurchase agreement and shall be adjusted no less than quarterly by the tri- <br />party custodial agent. The investments in repurchase agreements shall be in compliance <br />if the underlying securities are brought back up to one hundred two percent (102 %) no <br />later than the next business day. Securities that can be pledged for collateral shall <br />consist only of investments permitted within this policy with a maximum maturity of five (5) <br />years. If there is a default of the broker, the collateral securities can be sold. Since the <br />securities are valued daily, it is likely that the sale proceeds will equal or exceed the value <br />of the repurchase agreement amount. Purchases in this category shall not exceed ninety <br />(90) days or twenty percent (20 %) of the cost value of the Fund. <br />G. Local Agency Investment Fund - State Pool. The City may invest in the Local Agency <br />Investment Fund (LAIF) established by the State Treasurer under California Government <br />Code Section 16429.1 for the benefit of local agencies. Although there is no percentage <br />limitation on this fund, the "prudent investor" rule shall apply for a single agency name. <br />H. Medium Term Corporate Notes issued by corporations organized and operating within the <br />United States or by depository institutions licensed in the United States or any state and <br />operating within the United States. Notes eligible for investment shall be rated in a rating <br />category of "A" or its equivalent or better by a nationally recognized rating service. <br />Purchases in this category shall not exceed three (3) years to maturity or fifteen percent <br />(15 %) of the cost value of the Fund. Purchases in a single issuer in this category shall <br />not exceed five percent (5 %) of the cost value of the Fund. <br />I. Shares of beneficial interest issued by diversified management companies that are <br />money market funds registered with the Securities and Exchange Commission under the <br />Investment Company Act of 1940. The company shall have met either of the following <br />criteria: <br />1. Attain the highest ranking or the highest letter and numerical rating provided by not <br />less than two NRSROs, or <br />