Loading...
HomeMy WebLinkAboutItem 4.02 CT Investment Rpt ~ . ~'r, , . . CITY OF DUBLIN AGENDA STATEMENT CITY COUNCIL MEETING DATE: July 12, 1993 SUBJECT: City Treasurer's Investment Report as of June 30, 1993 (Prepared by Paul S. Rankin, Assistant City Manager/Administrative Services Director) EXHIBITS ATTACHED: ~ City Treasurer's Listing of Investments as of ~ J ~une 30, 1993 RECOMMENDATION: /~ Receive Report .~ Attached is a list which details City of Dublin investments as of June 30, 1993. The investment portfolio total as shown on the attachment totals $18,635,000. This remains unchanged from the report covering the period ending May 31, 1993. On June 30, 1993, the Treasurer executed a trade with Dean Witter to purchase $1 million of the U. S. Government Securities Trust Mutual Fund. The actual settlement date for this transaction will be July 8, 1993. During the time frame from the "Trade Date" until the "Settlement Date," these funds are invested in a Dean Witter Money Market Fund. For the current reporting period, this only applies to one day. (June 30th) The investment in the mutual fund will further diversify the City's portfolio, without subjecting public monies to significant risk. The Dean Witter Mutual Fund is the largest Standard & Poors rated fund, with investments of approximately $12.6 billion. The fund is currently rated MAf and invests in only U. S. Government Securities, including Ginnie Maes. Investing as part of a mutual fund provides the City with an opportunity to benefit from the larger total pool of funds, which can spread maturities and purchase a blend of investments which would be difficult for the City to individually select. The current mix of securities in the fund have an average maturity of 5 years. The fund has over 5 years of history and has outperformed LAIF. Although a mutual fund investment has liquidity and can be sold without a set maturity, Staff recommends that the investment be held for six years. This will allow for withdrawal of the principal investment, without any redemption charge. Di vidends and earnings on the fund are distributed without a redemption charge and will be reported as interest earning on an annual basis. As of the 12 months ending June 30, 1993, the fund paid dividends equivalent to an annualized earnings yield of 6.92%. During the month of June, the amount invested in the Local Agency Investment Fund decreased by $1 million, to reflect the purchase of the Dean Witter Investment. The LAIF quarterly interest rate remained the same as the figure presented for May 31, 1993. Interest from LAIF is paid quarterly; however, it operates as a money market fund in that there is no fixed maturity date. The schedule of investment maturities is anticipated to allow the City to meet anticipated expenditures in the upcoming month. PSR/lss a:712Invest.doc.agenda#12 CITY CLERK FILE ~ --------------------------------------------------------------------------- COPIES TO: ITEM NO. ~;{ of . . city of Dublin City Treasurer's Listing of Investments As of June 30, 1993 This listing excludes Dublin Boulevard Extension Assessment District and COP reserve fund balances, which are held by third party Trustees and invested in accordance with the financing legal documents. INSTITUTION MATURITY INVESTMENT Type of Investment Date Value Rate Cost Yield state of California LAIF $14,850,000.00 $14,850,000.00 (1) 4.514% Bank of California FHLB Debentures ( 2 ) 8/26/96 $490,000.00 7.700 $490,000.00 7.700% FNMA Debentures (2) 6/10/97 $1,205,000.00 9.200 $1,300,000.00 7.066% FNMA Debentures (2) 5/13/98 $500,000.00 5.250 $495,000.00 5.482% FFCB Debentures (2) 2/02/98 $400.000.00 5.800 $400.000.00 5.800% $2,595,000.00 $2,685,000.00 6.701% World Savings Cert of Deposit 1/29/98 $100,000.00 6.010 $100,000.00 6.010% Subtotal $17,635,000.00 4.855% --------------- -------- --------------- ------- Dean Witter Reynolds Inc. Money Market Fund (3 ) $1,000,000.00 $1,000,000.00 ( 3 ) Total Investments - per books $18,635,000.00 ------......-------- --------------- Footnotes (1) Interest rate shown reflects quarter to date as of June 29, 1993. (2) Federal Home Loan Bank (FHLB), Federal National Mortgage Association (FNMA), and Federal Farm Credit Bank (FFCB) are lawful investments for local governmental agencies. (3) Temporary placement of funds pending settlement of trade. Interest rate of 2.58% is based on a 7 day rolling average.