HomeMy WebLinkAbout0561.093Novembe r 4, 1 993
THE HONORABLE CITY COUNCIL
Palo Alto, California
INVESTMENT ACTIVITY REPORT fOR SEmMIlER 1993
Members of the Cooncil:
",:
This is an mfomJBtional report aoo no Councn action is necessary.
INTEREST INCOME
In1er.st income on an accrual basis for the .month of September was $858,965 and
for the first three months of 1993-94 totaled $2.6 million, or 21 percent of the 8Mual
target of $9.7 million. On a cash b.sis, roceipts totaled $653,118 for September and
$2.6 million year to date. Ttle effective annual rate of return on an accrual basis is
5.81 percent for the fiscal year.
CURRENT PORTFOUQ
The par value of the City's portfolio is $186 million, which consists of $152 mjllion,
or 82 percem. maturing within two years. Most of the investments. $140 millioo i or
7S percent i are in United States Government securities. The current market va[ue of
the portfolio is 100.9 percent of cost. The average lif. of the portfolio is 1.3 years.
INJEREST MTES AND INVESTMENTS
In Septemberi staff invested $7 miWon in two-year Treasury Notes at a return of 3.9
percent; $2 million in Certificates of Deposlt for one year at a return of 3.4 percent;
and $2.5 million was placed in the Fidelity Fund for one day.
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The following graph of the Consumer Priee Index ICP1) measures the chanoe in lhe
cost of typical purchases of gooOs and servicos expressed as • percentage of the COSI
of the.e same goc>ca and sarviess since the previous year. CP1 is accepted bV many
people as a leading irrllcator of the economy. because it indicates the Increase or
decrease in prices due to the affects of Infiltion. Since trend. in inflalion greally
Influence imerest rales, CPI plavs 8 pivotal role in economic forecasts. This graph
shows that the current economy cont1nues to decline 8 rld, as a result. interest ratea
con::inue to declirle.
CONSUMER PRICE INDEX
I
2~r--
I%L_.~
0% l"-.--,--~---,----._ .L' __ --'_
Soe:p'8B Srp'8S SI!'<;>'90 Sep'Sl 5 .. .,'92
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I' , TNs graph of the CPt sugQ'3Sts that inflation I!; under control aM, as a result, interest
rates l>ave decreased significantlv. Dua to the slow economic growth and the planned
large utility refund, staff will continue to invest a high ~rcentage of the portfolio in
short-term maturities. As shown on this report, 82 ~rcent of the portfolio matures
within two years.
COMPLIANCE WITH INVESTMENT POYCY
As of September 30, 1993, the investment portfolio was in compliance with an
elements of the City's investment perocy. In October 1993, projections indicated
receipts WOUld be .18.4 million, ex~nditura. would be '14.9 million, and '20.6
million in investments would mature. On the basis of the above projection, there were
sufficient funds to meet Palo Afto·s expenditure leQuirements for the month of
October. Based upon the cash flow projectiOns prepared bv Treasury staff for fiscal
year , 993-94, there are suffic ient funds from the revenues and maturing investments
to meet an expendn:uf9 requirements for the rerrainder of the fiscal year.
Respecttuny submitted,
h4Jft'-7#~
GORDON FORO
Treasury Manager
-A.fI~~ ~ EM'Ik HARRISON
Assistant C-Manager
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REPORT OF INIIESTMENTS
SEPTEMBER 30. 1993
Par Amount 913D193 1993·94 8131193
(10 S MilljpMI ..u.L -Il!lII1. ...1lIL
BY MATUIIID:
Within 1 momh • 20.60 11.10 > .6 12.68
1·3 m<>nths 15.50 8.35 6.03
3-6 moo"" 16.00 8.61 10.15
6-9rnont!ui 29.00 15.61 15.97
9-12 monttu 17.00 9.10 8.78
t-2 yurl ~ .2Mi ..2.illI
Within 2 y&8J"S 152.10 81.92 > '50 81.54
2-5...,. 32.50 17.5t 17.63
6-10 years .00 .00 .00
'0-20 vears .44 .24 .25
20-30 .... ....M -...aa ~
Over 2 ..... rs 33.55 18.08 18.46
TOTAL 185.65 100.0% 100% 100.0%
BY 'D'I'£ OF INV£STMENT
Locar Agency Investment Fl)r\d 15.00 8.08 8.23
Mutual Fund 2.60 1.40 < 15% .06
Certificates of Deposit:
C<l'Iater.JfLZed 19.00 10.23 9.33
Bankers Acceptances 3.00 , .61 < 30% 3.29
Cornmetcio' "-6.00 3.23 < 15% 3.29
U.S. Treasury 67.00 38.07 35.11
U.S • .......,.,., ~ ~ ~
TOTAL 185.65 100.0% 100% 100.0%
Market V~lueI'Cost $188.41186.8 100.9% > 950% 101.9"
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R~PORT Of INVf8TMENTS
SEI'TEMBEII 30. 1883
Purch_ """",.1
'ntetest Maturity Par M.1bt Untaallzed "'leo 110 ...
alllII!!<E -'li1o... ...lllII... 'hIIII ~ G,lo'Lpu) lIIIIna WnlIIIII
INVESTMENTS
Laclll_Aaancv InWItltlll1.t fund18,mr1f,J •
LAIF 4,43 10-01,93 11;.000.000 1&.000.000 16.000.000 63.740
Mutu.1 Eund '].~Q~I
fidelity 'nvelm-nt. Z.74 10-01·93 2.100.000 Z.IOO.ooo 2.100.000 430
~IDHitAlll Slf Qlwil tlQ 2a~1
Sumitomo Bank ICo/lat"al) 3,20 02·18-9' 3.000.000 3.000.000 3.000,000 8.000 t~~W:?t:"".,:~(,_; ""\'
Stcr.metUo Bank (Collate,alJ 3,20 02·22·94 3.000.000 3.000.000 3.000.000 8.000
SIIct'manto e.nk (COdat .... 11 3,20 03· 10-9. 3.000.000 3.000.000 3,000,000 8.000
Sumitomo Bank ICoh,te,.n 3,40 03·28·94 2.000,000 2.000.000 2.000.000 5.661
s.cr.mento Bank ICoIlateraO 3,30 04-08·94 3.000.000 3.000,O()O 3.000.000 8.25~
SurnitomD BlInk ICon,taraO 3,30 04·26·94 3.000.000 3.000.000 3.000.000 8.26 .'
Sumltomo Bank fCollate,". 3AO 09·29-94 2.000 000 2000.000 2.ooo.00!I .Ja
.19.000.000 ., 9.000.000 .19.000.000 646.356
Cpm".,,'" PIP" 13,23%1
"'"oclate. of Am,rica 3,1S 12·01·93 3.000.000 2.966.200 ~.96S.2OO 7.950
Gene"ll Electric 3,29 01·31·94 3.000.000 2.950650 2.950.850 .Ull
'6.000,000 65.918.850 .6.91S.S50 "6.'75
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REPORT OF INvesTMENTS P_3016
SEPTEMllER 30, 1993
Purch ... Accru.1 Inter.lSt Maturity Pat Mati(et Unrealized Price Bai, mIIII!:.E J!IJL ..J1I1O... Y.IIlIt Y.IIlIt G,ln (LOM) lIIIIIw.. flImirIIII.
Btnk.!'1 ACClptlnce (1..11%1 f)
S,nw. Bank 3.08 10-29-93 3.000,000 2.954.570 2,954,570 7,700
1I.1...IwiurY 136.07%1
T ' ••• ury Notes 7,75 11-16·93 8,000,000 8.081,663 8.081.663 51.667 T r .... ury Notes 7.63 12·31·93 2,000,000 2,018,875 2,018,875 12,708 T,..aury Notllli 5.36 04-30·94 12,000,000 12,252,071 12,252,071 53,750 Treasury Note. 7.00 05-16-94 6,000.000 6,071,875 6,071,875 35,000 Trealury Not •• 6.00 11-16-94 5,000.000 5,134,000 62.437 5,051,563 25,000 Tree8ury NOtee 5.50 02-16-95 7,000.000 7,171.000 32,172 7,138.828 32.083 'fre •• lIly Note. 3.88 09-30·~6 7.000,000 '.998.000 4.018 8,993.964 0 Treasury Note. 5.13 11·16·95 14,000,000 14,350,000 2.4,842 1.,105,158 59,792('1) Tro6lury Not •• 4.63 02-15-96 8.000.000 8.079000 .1.2.5U 6.008406 Am'('
'67.000,000 168.154,384 1436.061 8S7.718,32J '293,125
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AEI'ORT 0' '''VESTMENTS '.1016
SEPTEMBER 30, '993
"""'h ... A""",,, Int, .... t MOIutity Par M.rket Un .... 1ized Price 6001, IIlIIBCf -llI1L --'l.IIL ~ YI1III ~ lIIlInoa. bm/JlIII
U S AGENCy 139 .3ftd
FHlB 12.16 12·27·93 2.500,000 2,437,500 2,437,500 25,31~ FHl5 7.55 01·26·94 2.000,000 2,003,125 2,003.126 12.583 ,. FHLB 7.60 06·27·94 6,000,000 5,087,188 5.087,188 31,250 FNMA 7.45 07-11·94 3,000.000 3.0 06.797 3,036.797 18,625 FHlB 6.70 08·25·94 8.000,000 8.246,260 8,246.250 44.667 FHla 6.58 09·26-94 4.000,000 4,104,688 4,104.688 21.933 FHlB 5.94 02-27·95 B,OOO,OOO 6,178.000 169,875 6.018,125 29,700 fHlB ~.45 03-27·95 B,ooo,OOO 8.305.000 240.000 8,0116,000 43,000 FHl8 6.04 04'25·95 8.000,000 6.195,000 196,625 6,999.375 30,200 FNMA 3.84 06·02-95 2,000,000 1,998.000 6.750 1.991,250 6,400 FHlB 3.79 05-26·95 3,000.000 2,987.000 3.406 1,991,250 6,400 FNMA 4.32 06·011·95 3,000,000 3.013.000 {593, 3,013,593 10.600
.. ,.' .. C TVA 4.13 08·15·95 7,000.000 7.020,000 22,167 8.997.813 24,083 l.'<" . . ..... ,,\ Ftil81al 7.95 12·28-95 3.000,000 3.025.000 25.000 3,000,000 19.875 FNMA (bl 7.70 02·12-96 2.000,000 2.026.000 28.500 1.997,600 12,833 'J> --. "' "l~h." ,'. ~.~-': ", I,' fNMA 7.60 01-10·97 2,000,000 2.178.000 175.187 2,002,813 12.667 .. -'_. ~f,t'1-f':;:-"';'; • .'\.'I· ';v''-' FlB 1.35 0'·20·97 600,000 538.000 38,000 600,000 30113 [) ~t '{fn~rk~'~~-r;:f:' " : j',
FNMA 6.05 01·12·98 5.000,000 5.231,000 233,345 4,997.655 25:208(:. FHlMC IP&I, 10.00 02·01-09 253.746 280.000 42.660 237,340 2.11S FHLMC (P&I Seml-Annual,v. 12.45 09-15·09 192.000 214.000 13.375 200.626 1.886 GNMA {PIli '.00 11·15·16 GOI! 2fi5 66:].200 lQ 82Q §!D JZ~ ~ -~II' .
"3,045,001 .74.754.548 ",194,'43 "3,660.405 .390.227
l~\;)\~$,'.(~: .. rM' .,'
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MltYrtd and Sold I"yeatmlD!'
Serl •• PI·'
FHlo
Sumitomo Bank
Tr ... ury Not.8
Intere.t
.BIlL.
10,95
7,95
3,10
8,~5
REPORT OP INVESTMENTS
SEPTEMBER 30. 1_
Mllurlty Pat Mlrket
J2IiL 'MIl 'MIl
07-02-9~
09-27-93
09-30-93
09-30-93
TOTAlINVESTMENTSl1oo"'l .'86,646.00' .'88.392.352
(P"" Principal and Int ... ., .. payments monthj.,.,
Investments with maturitlea of la'i than One vear are valued at cost.
Purchas •• ainee I'at report at, shown in bold type.
fa) FHlB h ••• call.hle option, beginning on 12.21.93.
(b) FNMA hat 8 call,bl. OPtion, beginning on Ol-12-94.
,9-) Serl., P Bond principal payment we. '8c:eived In September 1993,
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Purchaa. A .. "",
Unte.llz.cJ PrIco Bo.lo
G.ln CLoul llIIBI bml!lIII
•
0
!:I,962
1.750
21.600
".830.204 .186.75.2.148 $858.965
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IN1tREST INCOME IACCRUAt. BASISI
S£P1EMBEl! 30. ,993
Wo", ToO-
lJniI liU:U
1ntat'eS1 Income I 2.582.949
Effective Annual
Rate of Retum
On Investments 'I' 6.80
1r!tmUt Ratu as 9f Stptpmber 30 T 993
!'rime Rate;
3-mc.;;ttI Trusury Bin:
3-momh --. Ac_,
3-mon1I1 Commercial ""po<:
3_ C4<tific:ates 01 Deposit:
2-year Treasury Note:
2-year Agency:
Source: Wall Street Journal 10;'01/93
To £ntl
l..Sft&!
2.595.173
6.00%
2.90%
3.05%
3.19,*
2.63%
3.86%
3.93%
5.81
Increili8
(Decrease)
T 993-91
'2.22'
1.99!
Plge 0 of e
'I'Of
Target
~ !l>.llIIt
9,700,000 26.75
5.5 105,64