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HomeMy WebLinkAboutInvstmnt Rprt - June 2010 : ,,.--�� City c�f Paim Desert ^ � � City and Redevelopment Agency RortfoHos � � COMPl.IANCE ANALYSfS AND fNVESTMENT REPt�RT June 2010 Paul S. Gibson, C.C.M.T., Treasurer Thomas W. Jeffrey, J.D., M.B.A., Deputy City Treasurer Treasurer's Commentary The Federal Open Market Committee(FOMC)will meet next on August 10. At its June 24 meeting, the FOMC noted that while an economic recovery was proceeding, consumer spending remained constrained by high unemployment, lower housing weaith, and tight credit. With infiation likely to remain subdued for some time, the FOMC stated that short-term interest rates would probably stay at current levels for an extended period. U.S. economic growth is expected to slow during the second ha�f of 2010, in the absence of further Federal stimulus. A double-dip recession is not thought likely, however, unless there are substantial tax increases. Small businesses remain starved for capital. U.S. banks are constrained in their ability to lend to small businesses due to an estimated $176 billion of sour real estate loans. About two-thirds of bank commercial real estate loans that will mature between 2010--2014 are "underwater"{property worth less than loan). Banks continue to"extend and pretend"on delinquent loans (as opposed to foreclosing) in order to avoid a hit to their earnings. This limits their lending capital. It is impossible to anticipate when short-term interest rates will rise. The City Treasurer's Office is therefore pursuing a strategy of buying securities in the middle of the maturity range, with an emphasis on U.S. Agency callables and selected high-grade corporate bonds, that offer a higher incremental yield. �auLs G�I�n, c.c.,y r City Treasurer PORTFOLIO STATISTICS Dollars in Thousands JUN-10 MAY-10 APR-10 MAR-10 FEB-10 JAN-10 CITY Month-End Book Value�"* $ 201,932 $ 201,783 $ 198,943 $ 197,952 $ 200,124 $ 218,094 Nlonth-End Market Value""* $ 202,476 $ 202,374 $ 199,620 $ 198,665 $ 201,136 $ 219,068 Paper Gain(Loss) $ 544 $ 591 $ 677 $ 713 $ 1,012 $ 974 PriorYear Book Variance $ (27,016) $ (22,506) $ (19,020) $ (18,722) $ (19,345) $ 5,356 Interest Earnings 227 207 233 227 $ 227 $ 221 Yield-To-Maturity 1.16% 1.28% 1.45% 1.43% 1.41% 1.31% Weighted Maturity(Days) 363 415 461 465 455 419 Effective Duration 0.23 0.23 0.28 0.35 0.35 0.35 RDA Month-End Book Value*"" $ 302,563 $ 299,721 $ 285,335 $ 295,407 $ 304,221 $ 287,243 Month-End Market Value"*" $ 303,003 $ 299,998 $ 285,685 $ 295,786 $ 304,733 $ 287,7gg Paper Gain(Loss) $ 440 $ 277 $ 350 $ 379 $ 512 $ 545 Prior Year Book Variance $ 15,272 $ 6,001 $ 32,808 $ 27,030 $ 33,805 $ 5,970 Interest Earnings 200 171 175 174 $ 168 $ 183 Yield-To-Maturity 0.78% 0.69% 0.74% 0.70% 0.69% 0.72% Weighted Maturity(Days) 344 226 237 229 223 236 Effective Duration 0.51 0.31 0.34 0.35 0.34 0.38 ""' Omits SLGSs. City of Palm Desert-- Portfolio Characteristics June 30, 2010 Dollars in Thousands A�.ein�Interval Market Value (� ------------ < 1 M $ 75,993 ! General Fund Ageing � � `2M 6,056 <3M � ' 100 _....,_. _._�..... ._,.._,._ �__..__._ _.._.... ._ _._.._ �6M 17,106 ' < 1 YR 11,205 � 0 80 ; <2YR 20,276 � 0 60 5� ' '" <3YR 18,054 j � 40 + <4YR o i ; °' 12 14 12 < 5YR � �� 4 0 $ 0 0 0 j > 5YR _ � 0 Total: $ 148,690 � < < < < < < < < < > , � � - 1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR_ � Ratinas` Market Value Credit Quality AAA � $ 42,407 � 22% I qq I 83,568 ,q,4 A 6,963 I 42% Unrated`'' 62,254 Unrated*` � � Total: $ 195,192 32% A 4% J Sector Market Value Asset Allocation MTNs MMF $ 29,811 14% Agencies 46,440 Agencies � CAMP 0 MTNs 28,278 24% s:,;�� 15/0 CAMP 2g,4pg RDA Loan i RDA Loan 22,655 MMF 12% I LAIF 39,599 15% LAIF Total: $ 195,192 Z�% J Month Citv Yield LAIF Yield Variance Performance Ju109 1.90 1.04 0.86 Aug 1.79 0.93 p.g7 2� .__. ,_.�____n_._.__..____.__a.__ , .�_.___.. _ _.._...._.... Sep 1.74 0.76 0.98 � Oct 1.69 0.65 1.05 ^ 1.4 I' Nov 1.93 0.61 1.32 � � �o I Dec 1.82 0.57 1.26 m Jan10 1.31 0.56 0.76 } 0.7 � � Feb 1.41 0.58 0.83 � Mar 1.43 0.55 p.gg 0.0 Apr 1.41 0.59 0.83 Ju109>ugSepOctNovDedan1�ebMarAprMayJun May 1.25 0.56 0.6g � o � Jun 1.16 0.53 0.63 J * Standard and Poors "* LAIF,and City Loan to RDA Page 2 City of Palm Desert Portfolio Holdings June 30, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P Medium-Term Notes $ 3,795,000 BANK OF AMERICA 5.38 8/15/11 $ 3,847,148 4.05 103.90 $ 3,943,047 A2 A $ 3,000,000 BANK OF AMERICA 4.25 10/1/10 $ 3,007,494 3.20 100.66 $ 3,019,692 A2 A $ 2,035,000 GENERAL ELECTRIC 4.88 10/21/10 $ 2,030,868 5.63 101.17 $ 2,058,797 Aa2 AA+ $ 1,891,000 GENERAL ELECTRIC 6.88 11/15/10 $ 1,898,535 5.65 102.01 $ 1,929,090 Aa2 AA+ $ 2,000,000 GENERAL ELECTRIC 6.13 2/22/11 $ 2,005,110 5.67 103.21 $ 2,064,278 Aa2 AA+ $ 3,965,000 GENERAL ELECTRIC 4.88 10/21/10 $ 3,983,938 3.23 101.17 $ 4,011,367 Aa2 AA+ $ 3,000,000 TOYOTA 4.35 12/15/10 $ 3,053,263 0.44 101.42 $ 3,042,528 Aa1 AA $ 2,000,000 WACHOVIA 7.80 8/18/10 $ 2,006,662 5.02 100.79 $ 2,015,862 A1 AA $ 4,000,000 WELLS FARGO BANK 6.38 8/1/11 $ 4,047,644 5.13 104.62 $ 4,184,896 A1 AA $ 2,000,000 WELLS FARGO BANK 4.63 8/9/10 $ 1,999,111 5.09 100.40 $ 2,008,022 A1 AA $ 27,686,000 Subtotat $ 27,879,772 4.09 $ 2g,y77,57g Agencies--Coupon $ 3,000,000 FED FARM CREDIT BANK 3.50 10/3/11 $ 3,094,247 0.97 103.69 $ 3,110,625 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.63 7/27111 $ 3,025,352 1.18 101.19 $ 3,035,625 Aaa AAA " $ 3,000,000 FED HOME LOAN BANK 0.44 10/7/10 $ 3,000,953 0.32 100.06 $ 3,001,875 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.63 3I16/11 $ 3,024,005 0.41 100.91 $ 3,027,188 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.10 8/28/12 $ 2,999,362 1.11 100.56 $ 3,016,875 Aaa AAA $ 2,062,000 FED HOME LOAN MTG CORP 4.13 7/12/10 $ 2,074,116 5.47 100.13 $ 2,064,578 Aaa AAA $ 3,000,000 FED HOME LOAN MTG CORP 1.63 4/26/11 $ 3,024,070 0.60 101.00 $ 3,030,000 Aaa AAA $ 3,000,000 FED HOME LOAN MTG CORP 4.13 2/24/11 $ 3,069,728 0.52 102.34 $ 3,070,313 Aaa AAA $ 2,000,000 FED NAT MTG ASSOC 4.25 8/15/10 $ 1,997,232 5.47 100.50 $ 2,010,000 Aaa AAA $ 3,000,000 FED NAT MTG ASSOC 1.75 12/28/12 $ 2,996,206 1.91 100.53 $ 3,015,938 Aaa AAA $ 28,062,000 Subtotal $ 28,305,272 1.54 $ 28,383,015 Agencies--Callable $ 3,000,000 FED HOME LOAN BANK 1.00 10/28/11 $ 3,000,000 1.00 100.19 $ 3,005,625 Aaa AAA $ 2,980,000 FED HOME LOAN BANK 1.88 11/19/12 $ 2,985,457 1.61 100.53 $ 2,995,831 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.85 12/21/12 $ 3,000,789 1.82 100.47 $ 3,014,063 Aaa AAA $ 3,000,000 FED HOME LOAN MTG CORP 1.25 1/26/12 $ 3,000,000 1.25 100.38 $ 3,011,409 Aaa AAA $ 6,000,000 FED NAT MTG ASSOC 1.75 12/28/12 $ 5,992,723 1.90 100.53 $ 6,031,875 Aaa AAA $ 17,980,000 Subtotal $ 17,978,968 1.58 $ 18,058,803 Local Agency Investment Fund $ 39,598,636 L.A.I.F. 0.00 7/1/10 $ 39,598,636 0.53 100.00 $ 39,598,636 U U $ 39,598,636 Subtotal $ 39,598,636 0.53 $ 39,598,636 Local Agency Investment Fund $ 27,801,257 C.A.M.P. 0.00 7/1/10 $ 27,801,257 0.25 100.00 $ 27,801,257 U AAA $ 607,515 C.A.M.P.(DESERT WILLOW) 0.00 7/1/10 $ 607,515 025 100.00 $ 607,515 U AAA $ 28,408,771 Subtotal $ 28,408,771 0.25 $ 28,408,771 "U"= Unrated Page 3 City of Palm Desert Portfolio Holdings June 30, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P Money Market Fund $ 29,810,641 WF ADVANTAGE GOVT MMF 0.00 7/1/10 $ 29,810,641 0.00 100.00 $ 29,810,641 Aaa AAA $ 29,810,641 Subtotal $ 29,810,641 0.00 $ 29,810,641 City Loan to RDA $ 22,655,000 CITY OF PALM DESERT 0.00 7/1/40 $ 22,655,000 0.53 100.00 $ 22,655,000 U U $ 22,655,000 Subtotal $ 22,655,000 0.53 $ 22,655,000 Totai Investments $ 194,201,048 $ 194,637,060 1.22 $ 195,192,445 Cash $ 6,523,590 CITY MAIN CHKG 0.00 7/1/10 $ 6,523,590 0.00 100.00 $ 6,523,590 U U $ 575,550 DESERT WILLOW CHKG 0.00 7/1/10 $ 575,550 0.00 100.00 $ 575,550 U U $ 183,656 RECREATIONAL FAC CHKG 0.00 7/1/10 $ 183,656 0.00 100.00 $ 183,656 U U $ 7�282,79g Subtotal $ 7,282,796 0.00 $ 7,282,796 Total Investments and Cash $ 201,483,844 $ 201,919,856 $ 202,475,241 %of Portfolio Corporate Issuers (Market Value) BANK OF AMERICA 3.44% GENERAL ELECTRIC 4.97% TOYOTA 1.50% WACHOVIA 1.00% WELLS FARGO BANK 3.06% "U"= Unrated Page 4 City of Palm Desert Portfolio Holdings June 30, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P %of Portfolio Agency Issuers (Market Value) FED FARM CREDIT BANK 1.54% FED HOME LOAN BANK 10.42% FED HOME LOAN MTG CORP 5.52% FED NAT MTG ASSOC 5.46% "U"= Unrated Page 5 Palm Desert Redevelopment Agency--Portfolio Characteristics June 30, 2010 Dollars in Thousands A�eina Interval Market Value � _----�--------" . -- < 1 M $ 57,844 I LPortfolio Ageing w/o SLGSs � <2M - i 1 `3M 10,817 � 100 .___._.__._..__ f ___..___ �___..... _...._.._ _.._..... _ `6M 3,003 l 80 ' < 1YR 16,229 f = � � <2YR 17,646 � 0 60 � <3YR 44,286 � � 40 38 29 ! 1 <4YR ° � <5YR � � 20 � � � 11 12 � � � 0 0 2 j � >5YR 3,151 � ' Total: $ 152,976 � < < < < < < < < < > � � 1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR �� \ - -- _ _ __-. _-_- _ __ _ ___ ualit * Market Value �Credit Quality � � $ 155,752 � qqq 2% '� 6,063 52% A A 10,003 3% Unrated"`* 130,560 � Total: $ 302,378 Unrated" 43% I � Sector Market Value Asset Allocation MMF $ 66,381 Agencies CAMP Agencies 79,033 � 26% 2% MTNs 16,066 MTNs � CAMP � �g� MMF 5% LAI F 49,787 22% LAI F EIP 3,151 16% LAIF/Bond Proceeds 80,773 LAIF/Bond EIP i Total: $ 3a2 3�$ Proceeds 1% ' 28% I -- -- � _ -__ _ _ - - _ - Month RDA Yield LAIF Yield Variance ' Performance Ju109 1.31 1.04 0.27 Aug 1.19 0.93 0.26 I I 1.5 __..__--.._.___,___.._��..______.____.._._.._..._.___.____._...._._..___._ Sep 0.95 0.76 0.19 , � � Oct 0.96 0.65 0.32 � Nov 1.21 0.61 0.59 = 1.0 � Dec 1.21 0.57 0.64 d � � Jan10 0.72 0.56 0.16 � 0.5 ��� � � Feb 0.69 0.58 0.12 i Mar OJO 0.55 0.15 OA ' Apr 0.74 0.59 0.15 Ju1094ug Sep Oct Nov Dedan1�eb Mar Apr May Jun I May 0.69 0.56 0.13 _ - - -- _ _. m LAIF Yield ORDA Yie�d Jun 0.78 0.53 0.25 � '` Standard and Poors '* LAIF Page 6 Palm Desert Redevelopment Agency Portfolio Holdings June 30, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P Medium-Term Notes $ 3,000,000 ABBOTT LABS 3.75 3/15/11 $ 3,066,330 0.60 102.08 $ 3,062,508 A1 AA $ 3,450,000 BEAR STEARNS CO. 6.95 8/10/12 $ 3,812,162 1.83 109.69 $ 3,784,195 Aa3 A+ $ 3,000,000 JP MORGAN CHASE 3.13 12/1/11 $ 3,093,973 0.69 104.15 $ 3,093,973 Aa3 A+ $ 3,000,000 JP MORGAN CHASE 5.60 6/1/11 $ 3,129,558 0.85 104.17 $ 3,124,995 Aa3 A+ $ 3,000,000 WAL-MART 4.13 7/1/10 $ 3,000,000 2.91 100.00 $ 3,000,000 Aa2 AA $ 15,450,000 Subtotal $ 16,102,023 1.39 $ 16,065,670 Agencies--Coupons $ 4,900,000 FED FARM CREDIT BANK 4.90 9/22/10 $ 4,902,640 4.65 101.06 $ 4,952,063 Aaa AAA $ 2,000,000 FED HOME LOAN BANK 4.88 3/11/11 $ 1,991,983 5.49 103.09 $ 2,061,875 Aaa AAA $ 2,000,000 FED HOME LOAN BANK 4.88 3/11/11 $ 1,991,876 5.50 103.09 $ 2,061,875 Aaa AAA $ 2,890,000 FED HOME LOAN BANK 2.88 3/11/11 $ 2,937,585 0.49 101.69 $ 2,938,769 Aaa AAA • $ 3,000,000 FED HOME LOAN BANK 0.50 11/29l10 $ 3,002,571 0.36 100.13 $ 3,003,750 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.13 12/9/11 $ 3,008,314 0.96 100.78 $ 3,023,438 Aaa AAA $ 2,000,000 FED HOME LOAN BANK 1.10 8/28/12 $ 1,999,575 1.11 100.56 $ 2,011,250 Aaa AAA � $ 2,500,000 FED HOME LOAN BANK 1.10 8/28/12 $ 2,499,468 1.11 100.56 $ 2,514,063 Aaa AAA $ 2,500,000 FED HOME LOAN BANK 1.10 8/28/12 $ 2,499,476 1.11 100.56 $ 2,514,063 Aaa AAA $ 2,500,000 FED HOME LOAN BANK 1.38 10/29/12 $ 2,510,003 1.20 101.16 $ 2,528,906 Aaa AAA $ 4,900,000 FED HOME LOAN BANK 1.75 12/14/12 $ 4,947,689 1.40 101.94 $ 4,994,938 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.10 8/28/12 $ 2,99g,372 1.11 100.56 $ 3,016,875 Aaa AAA $ 2,000,000 FED HOME LOAN MTG CORP 6.88 9/15/10 $ 2,004,832 5.54 101.41 $ 2,028,125 Aaa AAA $ 3,734,000 FED HOME LOAN MTG CORP 6.88 9/15/10 $ 3,743,037 5.54 101.41 $ 3,786,509 Aaa AAA $ 2,940,000 FED NAT MTG ASSOC 1.75 3/23/11 $ 2,966,763 0.43 100.97 $ 2,968,481 Aaa AAA $ 9,000,000 FED NAT MTG ASSOC 1.00 11/23/11 $ 9,007,431 1.00 100.63 $ 9,056,250 Aaa AAA $ 2,500,000 FED NAT MTG ASSOC 1.13 7/30/12 $ 2,502,665 1.08 100.66 $ 2,516,406 Aaa AAA $ 55,364,000 Subtotal $ 55,515,280 2.09 $ 55,977,634 Agencies--Callable $ 2,500,000 FED FARM CREDIT BANK 1.90 11/16/12 $ 2,512,117 0.78 100.44 $ 2,510,938 Aaa AAA $ 2,500,000 FED FARM CREDIT BANK 1.90 11/16/12 $ 2,512,117 0.78 100.44 $ 2,510,938 Aaa AAA $ 7,000,000 FED HOME LOAN BANK 0.50 9/24/12 $ 7,000,000 0.75 100.06 $ 7,004,375 Aaa AAA $ 2,500,000 FED HOME LOAN MTG CORP 120 6/15J12 $ 2,502,933 1.08 100.48 $ 2,512,068 Aaa AAA $ 6,000,000 FED HOME LOAN MTG CORP 0.50 9/7/12 $ 6,000,000 0.50 100.14 $ 6,008,364 Aaa AAA $ 2,500,000 FED NAT MTG ASSOC 1.88 10/29/12 $ 2,514,290 0.41 100.38 $ 2,509,375 Aaa AAA $ 23,000,000 Subtotal $ 23,041,458 0.69 $ 23,056,057 Local Government Investment Pool $ 49,764,629 L.A.I.F. 0.00 7/1/10 $ 49,764,629 0.53 100.00 $ 49,764,629 U U $ 22,090 L.A.I.F.(HOUSING) 0.00 7/1/10 $ 22,090 0.53 100.00 $ 22,090 U U $ 49,786,719 Subtotal $ 49,786,719 0.53 $ 49,786,715 "U"= Unrated Page 7 Palm Desert Redevelopment Agency Portfolio Holdings June 30, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P Local Government Investment Pool $ 17,469,371 L.A.I.F./WELLS FARGO 0.00 7/1/10 $ 17,469,371 0.53 100.00 $ 17,469,371 U AA $ 4,804,427 L.A.I.F./WELLS FARGO 0.00 7/1/10 $ 4,804,427 0.53 100.00 $ 4,804,427 U AA $ 25,153,920 L.A.I.F./WELLS FARGO 0.00 7/1/10 $ 25,153,920 0.53 100.00 $ 25,153,920 U AA $ 1,700,760 L.A.I.F./WELLS FARGO 0.00 7/1/10 $ 1,700,760 0.53 100.00 $ 1,700,760 U AA $ 15,133,500 L.A.I.F./WELLS FARGO 0.00 7/1/10 $ 15,133,500 0.53 100.00 $ 15,133,500 U AA $ 16,511,283 L.A.I.F./WELLS FARGO 0.00 7/1/10 $ 16,511,283 0.53 100.00 $ 16,511,283 U AA $ 80,773,262 Subtotal $ 80,773,262 0.53 $ 80,773,262 Local Government Investment Pool $ 5,074,195 C.A.M.P. 0.00 7/1/10 $ 5,074,195 0.25 100.00 $ 5,074,195 U AAA $ 2,112,833 C.A.M.P. (HOUSING) 0.00 7/1/10 $ 2,112,833 0.25 100.00 $ 2,112,833 U AAA $ 7,187,028 Subtotal $ 7,187,028 0.25 $ 7,187,028 Money Market Fund $ 66,381,034 WF ADVANTAGE GOVT MMF 0.00 7/1/10 $ 66,381,034 0.00 100.00 $ 66,381,034 Aaa AAA $ 66,381,034 Subtotal $ 66,381,034 0.00 $ 66,381,034 Municipai Bonds $ 3,151,000 CITYOF PALM DESERT 3.00 9/2/29 $ 3,151,000 3.00 100.00 $ 3,151,000 U AA $ 3,151,000 Subtotal $ 3,151,000 3.00 $ 3,151,000 Total Investments $ 301,093,043 $ 301,937,504 0.78 $ 302,378,405 Cash $ 220,346 HOUSING AUTH CHKG 0.00 7/1/10 $ 220,346 0.00 100.00 $ 220,346 U U $ 404,747 HOUSING AUTH TRUST 0.00 7/1/10 $ 404,747 0.00 100.00 $ 404,747 U U S 625,093 Subtotal $ 625,093 $ 625,093 Total Investments and Cash $ 301,718,136 $ 302,562,896 $ 303,003,497 "U"= Unrated Page 8 Palm Desert Redevelopment Agency Portfolio Holdings June 30, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P %of Portfolio Corporate Issuers (Market Vatue) ' ABBOTT LABS 1.01°/a BEAR STEARNS CO. 1.25% JP MORGAN CHASE 2.05% WAL-MART p.ggo�o %of Portfolio Agency Issuers (Market Value) FED FARM CREDIT BANK 3.29% FED HOME LOAN BANK 12.43% FED HOME LOAN MTG CORP 4.73% FED NAT MTG ASSOC 5.04% "U"= Unrated ' Page 9 ' STATEMENT OF COMPLIANCE The investment portfolios of the City of Palm Desert("City")and the Palm Desert Redevelopment Agency("RDA")are governed by federal, state,and local law. The City Treasurer's"Statement of Investment Policy"is more restrictive than the California Government Code. The Palm Desert Audit, Investment,and Finance Committee and the Palm Desert City Council review the Statement of Investment Policy annually. For the month ended June 30, 2010,the City and the RDA investment portfo�ios were in compliance with all applicable federal, state, and local laws and regulations. The City Treasury continued to pursue conservative and prudent investment strategies, based upon the stated objectives of safety, �iquidity, and yield(in order of priority). Barring unforeseen events, the City Treasury should have sufficient cash to finance the operations of the City of Palm Desert and the Palm Desert Redevelopment Agency over the next six months. In addition, portions of either the City or the RDA portfolio could be liquidated in order to meet any significant, unexpected cash requirements. Interactive Data Corporation provided the data that was used to calculate the market value of all securities in the City and the RDA investment portfolios. State and Local Government Series securities are held in escrow accounts, and are therefore not included in this report as assets. All balances are bank balances. Respectfully Submitted on July 27, 2010, ,�'accLS. .�i'��o-�t, C.C.�1,r � , City Treasurer � SUMMARY OF AUTHORIZED INVESTMENTS California Government Code City Investment Policy CA Govt Maximum Maximum Quality Maximum Maximum Quality °/a of City %of RDA Code Investment Cate o Maturit Limit S&P/Md s Maturit Limit S&P/Mdys Portfolio Portfolio 53601 a Palm Desert Bonds 5 Years No Limit 0.0% 1.0% 53632 c Savin s Accounts No Limit No Limit No Limit No Limit 0.0% 0.0% 53601 b U.S.Treasuries 5 Years No Limit 5 Years No Limit 0.0% 0.0% 53601(c CA State Debt 5 Years No Limit NotAuthorized 53601 d CA Local A enc Debt 5 Years No Limit Not Authorized 53601 e Federal A encies 5 Years No Limit 5 Years 30% 6% 23.8% 26.0°/a 53601 Bankers's Acceptances 180 Da s 40% 180 Da s 40% A-1 &P-1 53601 Commercial Paper 270 Da s 25% A-1+or P-1 270 Da s 25% A-1+or P-1 0.0% 0.0% 53601 h Ne otiable CDs 5 Years 30% 5 Years 30% AA-or Aa3 53601 i Re os 1 Year No Limit 30 Da s 20% AAA&Aaa 53601 i Reverse Repos 92 Days 20% Not Authorized 53601 ' Medium-Term Notes 5 Years 30% A 5 Years 30% A 14.3% 5.3% 53601 k Mutual Funds 90 Da s 20% AAA&Aaa 90 Da s 20%(2) AAA&Aaa 15.3% 22.0% 53601 I Trust Indenture Debt Not Authorized 53601 m) Secured Bank Deposits 5 Years No Limit NotAuthorized 53601(k) Local Government AAA&Aaa AAA&Aaa Investment Pools 90 Da s 20% or Advisor 90 Da s 20% (2) or Advisor 14.6% 2.4% 53601(n) Mortgage-Backed 5 Years 20% A(Issuer)& NotAuthorized Securities AA Security 16429.1 b LAIF No Limit No Limit 20.3% 43.2% (1) The City loan to RDA,which is not a bond, has been approved by the Palm Desert City Council. 88.4% 100.0% (2) The City Energy Independence Program has been approved by the Palm Desert City Council. 3) Maximum limit for mutual funds and local government investment pools,excludin bond proceeds. " Certified California Municipal Treasurer Page 10