AgdaPkt 2019-01-14 Joint SA PFA - Laserfiche WebLink

Browse Search

6.A. -Page 15 of 22 CITY OF REDWOOD CITY INVESTMENT POLICY E. All bank deposits will be FDIC insured or deposited with institutions that comply with the State collateral requirements for public funds. F. Securities used as collateral for repurchase agreements with a maturity from one to seven days can be held in safekeeping by a third- party bank trust department or by the broker/dealer's safekeeping institution, acting as the agent for the City, under the terms of a custody agreement executed by the selling institution and by the City specifying the City's right to the collateral. G. All investment transactions shall be conducted on a competitive basis with quotes from a minimum of two brokers or financial institutions when possible. XIV. Diversification and Credit Risk Management A. Investments contained within the portfolio will be diversified by security type, institution and maturity. B. The diversification requirements included in Section IX are designed to mitigate credit risk in the portfolio. C. No more than 5% of the total portfolio maybe invested insecurities of any single issuer, other than the US Government, its agencies and instrumentalities. For some investment types, a more restrictive limit is specified in the policy. D. The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to improve the quality, liquidity or yield of the portfolio in response to market conditions or City's risk preferences. E. If securities owned by the City are downgraded by any nationally recognized statistical ratings organization to a level below the quality required by this Investment Policy, it shall be the City's policy to review the credit situation and make a determination as to whether to sell or retain such securities in the portfolio. 1. If a security is downgraded, the City Treasurer will use discretion in determining whether to sell or hold the security based on its current maturity, the economic outlook for the issuer, and other relevant factors. 2. If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and highlighted in thequarterly n entWinvestment report. XV. Maximum Maturities A. The City Treasurer will maintain sufficient liquidity in cash and short-term investments, which together with projected revenue receipts will meet the cash flow requirements of the City for the upcoming six months. B. The City will not directly invest in securities maturing more than five years away from the settlement date. In any case, where a cash flow is matched with an investment which exceeds the five year limit, the investment must be approved by the City Council. Approved update: °% 12 33