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03 Staff Report - Treasurer's Report July 2008pow N of MEETING DATE: 09/15/08 ITEM NO. 3 COUNCIL AGENDA REPORT !ps 6 A~46 DATE: September 10, 2008 TO: MAYOR AND TOWN COUNCIL FROM: LINDA SPEICHER, TOWN TREASURER SUBJECT: TREASURER'S REPORT FOR JULY 2008 RECOMMENDATION: Accept report as attached. DISCUSSION: Attached for your review and acceptance is the Treasurer's report for the month of July 2008. As is normal for this time of year, Treasurer's funds declined slightly. As investments matured that had previously been invested in Fannie Mae or Freddie Mac they were reinvested either in Treasuries or Federal Home Loan Bank or Federal Farm Credit Bureau notes. All but one of the investments that the Council requested that the Treasurer sell were sold or will mature in mid--September. One investment is callable in December 2008 and due to the fluctuations in the callable market, the decision was made to allow the investment to be called in December. The Treasury announced new structures for Fannie and Freddie, placing them in conservatorship and making changes with their management. The markets reacted favorably to the news. As of today Fannie Mae was actually able to price new 2 year notes at a lower spread (70 basis points) over the Treasury notes than had been required in the last couple of months. While we will continue to monitor the situation it appears that the government's action is having the desired effect on the marketplace. ENVIRONMENTAL ASSESSMENT: Is not a project defined under CEQA, and no further action is required. FISCAL IMPACT: None Attachments: Treasurer's report dated September 10, 2008 PREPARED BY: Linda L. Speicher, Town Treasurer Reviewed by: own Manager 'f o l Assistant Town Manager Town Attorney Clerkinance Community Development Revised: 9110108 7:28 pm Distribution: Town Council; Town Manager; Finance Director Reformatted: 5/30102 Meeting date: September 15, 2008 Item No: Town of Los Gatos Treasurer's Report for the month ended July 31, 2008 Submitted September 10, 2008 by Linda L. Speicher Distribution: Town Clerk Town Manager Town Council Town of Los Gatos Summary Investment Information July 31, 2008 Weighted Average Portfolio Yield: 3.60% Weighted Average Maturity (days) 464 This Month Last Month One year ago Portfolio Balance $76,014,723 $76,714,634 $69,314,343 Benchmarks/ References: Town's Average Yield 3.60% 3.65% 4.82% LAIT Yield for month 2.79% 2.89% 5.26% 3 mo. Treasury 1.73% 1.94% 4.97% 6 mo. Treasury 1.92% 2.19% 5.00% 2 yr. Treasury 2.82% 2.92% 4.74% 5 yr. Treasury (most recent) 3.44% 3.44% 4.64% Prime rate 5,00% 5,000/0 8.25% Most recent auctions of Freddie Mae or Fannie Mae Reference Notes; 3 yr. Freddie Mac (09/04/08)) 3.23% 2 yr. Fannie Mae (09/12/08) 2.90°10 3 -5 years 14% 2 - 3 years 15% 14% Portfolio Maturity Profile 0 Compliance: The Town's investments are in compliancc with the Town's investment policy dated May 1, 2008 and also in compliance with the requirements of Section 53601 of the California State Code. Based on the information availahle, the Town has sufficient funds to meet the cash demands for the next six months. Page I Town of Los Gatos Portfolio Allocation & Treasurer's Fund Balances July31, 2008 Fund Balances - Beginning of Month/Period Receipts Disbursements Fund Balances - End of Month/Period Portfolio Allocation: Union MM US Govt Agencies Local Agency lnvestmen(Fund Subtotal - Investments Reconciled Demand Deposit Balances Total Treasurer's Fund Local Agency Investment Fund 42.4, Month YTD $76,714,634.03 $76,714,634.03 2,586,72034 2,586,720.34 (3,286,631.85) (3,286,631.85) $76,014,722.52 $76,014,722.52 $330,504.77 41,700,381.72 31,577,981.68 73,608,868.17 2,405,854.35 $76,014,722.52 Treasury, Agencies, & Corp. Notes 57.8% Treasurer's Fund Balances $7&,0DD,000 $76,0DD,O00 $74,000.000 : , sy 77 $72,000,000 $70,000,000 {i $68,000,00n 1 = _ _ $66,000,000 _ $64,000,000 _ _ r r x $62,000,000 r r ~ t~ n n oo w oa w 0 0 0 0 0 0 0 0 0 0 0 0 0 bG ~ U > U ~ P ' T 0 z q a page 2 Portfolio Investment Allocation Union MM 0.4% Town of Los Gatos Statement of Interest Earned July 31, 2008 Current Fiscal Month Year to Date Interest received from Investments Add: Interest accrued at end or period (see page 5) Less: Interest accrued at beginning of period Interesi earned on investments $362,274,57 $362,274.57 578,791-33 578,791.33 (715,999.95) (715,999.95) $225,065.95 $225,065.95 Interest by Month duly 2008 August 2008 September 2008 October 2008 November 2008 December 2008 January 2009 February 2009 March 2009 April 2009 May 2009 June 2009 225,065.95 Page 3 Town of Los Gatos Inactive Deposits by Institution Market to Cost Position Report July 31, 2008 Deposit Amortized Maturity Days Days to Days Yield to Interest Interest Interest Institution Security Date Cost Date Elapsed Maturity Invested Mawrity Earned Received Accrued USTreasury Note 07119106 738,281.25 02/15/09 743 399 942 5,1571/o 77,502,36 53,142.27 24,360.09 FHLB Coupon Note 05/12/06 1,498,035.00 03/13109 811 225 1036 5,298% 176,344.49 144,593.75 31,750.74 USTreasury Note 05115106 1,992,343.75 05/15/09 808 288 1096 5.0149a 221,139.89 195,000.00 26,139.89 FHLB Coupon Note 06115106 1,493,400.00 06/12109 777 316 1093 5.226% 166,139.81 156,843.75 9,296.06 FFCB Coupon Note 07/19106 723.56150 07/17109 743 351 1094 5.4081/o 79,654.20 61,703.12 17,951.08 USTreasuy Note 06102108 1.537,617.20 07/31/09 59 365 424 2.426% 6,02933 11,244.85 (5,215.12) FFCB Coupon Note 04102108 2,010,820.00 08/04/09 120 369 489 2.286% 15,112.55 15,112.55 US'€'reasury Note 03/25/08 1,024,062.50 09115/09 128 411 539 1.709% 6,137.42 6,137.42 USTreasury Note 11/17106 748,066.41 11/15/09 622 472 1094 4.7340/a 60,348.42 51,839.61 8,508.81 USTreasury Note 06102108 1,514,941.41 12131109 59 518 577 2.602% 6,371.80 3,750.00 2,621.80 ML Corp Corporate Note 04110107 976,150.00 02108110 478 557 1035 5.165% 66,027.05 35,180.56 30,846.49 USTreasury Note 06/24108 739,921.88 02128/10 37 577 614 2.819% 2,114.41 2,114.41 USTreasury Note 10119106 976,406.25 04115/10 651 623 1274 4344% 82,615.85 59,560.44 23,055.41 FHLB Coupon Note 08122106 1,507,665.00 06111/10 709 680 1389 4.957% 145,170.09 135,750.00 9,420.09 FHLB Coupon Note 01112107 1,487,205.00 08/10/l0 566 740 1306 4.960% 114,386.84 75,983.33 38.403.51 USTreasury Note 05/31107 737,226.56 10115/10 427 806 1233 4,801% 41,406.42 27,868.85 13,537,57 F11,03 Coupon Nate 12/07/07 2,032,140,00 11/08110 237 830 1067 1715% 49,019.39 36,072.22 12,947,17 FHIAIC Coupon Note 94/24108 1,008,560.00 12124/10 98 876 974 4.007% 10,850.61 7,129.17 3,721.44 FFCB Coupon Note 01/18/07 756,922.50 01/18/11 560 901 1461 3.175% 16.871.46 13.125.00 23.746.46 FFC13 Coupon Note 11/28/07 2,061000.00 02118111 246 932 1178 3.840% 53,365.69 21,666.67 31.699.02 FNMA Discount Nole 09/29106 1.516 485-00 0411511 l 671 988 1659 4.874%n 135.879.30 118329.17 17,150.13 F11LMC Coupon Note 12/28/06 1532.350.00 07120111 581 1084 1665 5.375% 130,249.55 134,645.83 (4,396.28) USTreasury Note 10119/06 990,078.13 09130111 651 1156 1807 4.721% 83,366.50 65,151.10 18,215.40 FFCB Coupon Note 12112/07 2,025,080.00 11/21/11 232 1208 1440 4,0007. 51,486.97 38,183.33 13,303.64 FFCB Coupon Note 02122107 986,080.00 12/08111 525 1225 1750 4.95917a 70,335,20 59,868.06 10,467.14 F11 LB Coupon Nate 05109/07 1,509,255.00 03/09112 119 1317 1766 4,7431/a 88,058.08 62,500.00 25,558.08 FHLB Coupon Note 11/29107 2,038,360.00 08/15112 245 1476 1721 4.170% 57,054.53 19,527.78 37,526.75 GE Corporate Note 01116108 1,542,165.00 10/19112 197 1541 1738 4.587% 38,179.74 20,343,75 17,83599 FNMA Coupon Nate 02/21/08 1,260,300.00 01102113 161 1616 1777 4.562% 25,360.76 21,605.90 3,754.86 FNMA Coupon Note 09130/04 198,597.00 08115108 1400 15 1415 3.4429c 26,219.16 21,937.50 4,281.66 FNMA Coupon Note 11116104 199,216.00 09/15108 1353 46 1399 3.8669/b 28,549.01 24,979.17 3,569.84 FNMA Coupon Note 01119105 248,157.50 09115108 1289 46 1335 3.974% 34,826.94 29,583.33 5,243.61 FNIMA Coupon Note 11116104 199,552.00 11117/08 1353 109 1462 3.936% 29,114.95 27,146,53 1,968.42 FIILMC Coupon Note 07107105 296,40100 01112/09 112U 165 1285 4.313% 39,227.19 35,682.29 3,544.90 FNMA Coupon Note 01121105 242,400.00 03116/09 1287 228 1515 3.930% 33,590.07 24,631.08 8,958.99 FHLMC Coupon Note 06/17105 300,198,00 07130109 1140 364 1504 4,359% 40,870.19 40,942,71 (7152) FHLNIC Coupon Note 08/01105 298,332.00 07/30/09 1095 364 1459 4.527% 40,516.47 39,338.54 1,177.93 FHLMC Coupon Note 06114105 298,683.00 09/01/09 1143 397 1540 4.237% 39,629.84 33,58437 6,045.47 I-'HLMC Coupon Note 01/21105 149,686.50 09101109 1287 397 1684 4.180% 22,061.99 19,250.00 2,81 1.99 FHI.MC Coupon Note 06114105 299,331.00 01/25/10 1143 543 1686 4,431% 41,534.29 40,869.79 664.50 Subtotal 41,686,036.34 Uniua MN1 330,504.77 30 30 1.94% 527.00 527.00 Purchased Int erest 14,345.38 I.AIF NIA 06130/08 31,577,981.68 09130/D8 31 61 92 2.79% 74,498.93 74,498,93 $73,608,868,17 464 3.60% $2,547,745.15 $1,968.953.82 $578,791.33 Naturity Pr ofile Amount Percent 0-1 year $41.888.927.03 56.91% 1-2 years $10,245,733.95 13.92% 2-3 year% $11,122,889.06 15.11% 3-5 years $10,351,318.13 14.06 $73,608,868.17 100.00%a Market to Cost Position Report Amortized Market Unrealized Source: Treasary and Agency Obligat ions - Union Ban k of California Institution Cost Value* Gain (Loss) LAIF bala nces per Local Agency Investment Fund monthly statement. Union Bank Assets $41,686,036,34 $42,289,872.50 603,836.16 Union MM 330,504.77 330,504.77 0.00 Purchased int erest 14,345.38 14,345.38 0.00 LAIF 31,577,981.68 31,577,981.68 0.00 Totals: $73,608,868,17 $74,212,704.33 $603,83616 Page 4