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2004 06 09 IABa t P.O. Box 1504 78-495 CALLS TAMPICO (760) 7 7 7 - 7 0 0 0 LA QUINTA, CALIFORNIA 92253 FAX (760) 777-7101 AGENDA INVESTMENT ADVISORY BOARD Study Session Room 78-495 Calle Tampico- La Quinta, CA 92253 June 9, 2004 - 5:30 P.M. I CALL TO ORDER a. Pledge of Allegiance b. Roll Call II PUBLIC COMMENT- (This is the time set aside for public comment on any matter not scheduled on the agenda.) III CONFIRMATION OF AGENDA IV CONSENT CALENDAR A. Approval of Minutes of Meeting on May 12, 2004 for the Investment Advisory Board. V BUSINESS SESSION A. Transmittal of Treasury Report for April, 2004 B. Continued Consideration of Fiscal Year 2004/05 Investment Policy VI CORRESPONDENCE AND WRITTEN MATERIAL A. Month End Cash Report - May, 2004 B. - Pooled Money Investment Board Reports - March, 2004 VII BOARD MEMBER ITEMS - Vill ADJOURNMENT INVESTMENT ADVISORY BOARD Business Session: A Meeting Date: June 9, 2004 ITEM TITLE: Transmittal of Treasury Report for April 30, 2004 BACKGROUND: Attached please find the Treasury Report for April 30, 2004. RECOMMENDATION: Review, Receive and File the Treasury Report for April 30, 2004. 4John M. Falcoher, Finance Director 4 �Q�.rw MEMORANDUM TO: La Quinta City Council FROM: John M. Falconer, Finance Director/Treasurer SUBJECT: Treasurer's Report for April 30, 2004 DATE: June 2, 2004 Attached is the Treasurer's Report for the month ending April 30, 2004. The report is submitted to the City Council each month after a reconciliation of accounts is accomplished by the Finance Department. The following table summarizes the changes in investment types for the month: Investment . Beginning Purchased Notes Sold/Matured Other Ending Change Cash $ (102,723) (1) $ (1,076,162) ($1,178,885) ($1,076,162) LAIF 33,441,285 108,184 (4,600,000) 28,949,469 (4,491,816) US Treasuries (2) 70,031,843 - - 24,925 70,056,768 24,925 US Gov't Agencies (2) 30,061,700 - (16,261) 30,045,439 (16,261) Commercial Paper (2) - 0 0 Mutual Funds 2 392,507 927 1 2,393,434 927 Total $135,824,6121 $109,111 $5 676,162 $8,664 $130,266,225 $5,558,387 I certify that this report accurately reflects all pooled investments and is in compliance with the California Government Code; and is in conformity with the City Investment Policy. As Treasurer of the City of La Quinta, I hereby certify that sufficient investment liquidity and anticipated revenues are available to meet the pools expenditure requirements for the next six months. The City of La Quinta used the Bureau of the Public Debt, U.S. Bank Monthly Statement and the Bank of New York Monthly Custodian Report to determine the fair market value of investments at month end. John M. Falconer Finance Director/Treasurer Footnote (1) The amount reported represents the net increase (decrease) of deposits and withdrawals from the previous month. (2) The amount reported in the other column represents the amortization of premium/discount for the month on US Treasury, Commercial Paper and Agency investments. 2- ate O O O O m = C Z Z Z Z 2 Z Z Z X W Ste, SEA �o co a c U U U O � C LI R N N to N Of 71, N p� tO tS p m p >, N c Sa gEEEE j3 1n q 0 In i. r�r'. � Lo � 1O — $ Qam Ca _ a 8 8 O g s- e v v LU E �' Q y a o°Di � O go �p p CM � pQ Z c4i ppppp40 8pp pp0 0 �AMU9SIODD o e4i 0 S 0 (gi �Y O M o� Z O 7 �Q 2• fn a-• O MW Nggg$V) O�A�lfO O f�j Z In E e. 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FA BALANCE SHEET 0400104 FIXED LONG TERM FIXED LONG TERM FINANCING LONG TERM GRAND CITY ASSETS DEBT RDA ASSETS DEBT AUTHORITY DEBT TOTAL ASSETS: POOLED CASH (11,728,833.89) 0.00 0.00 38,855,241.09 0.00 0.00 5.726.82 0.00 27,132,134.02 LQRP INVESTMENT IN POOLED CASH 0.00 0.00 0.00 612,000.00 0.00 0.00 0.00 0.00 612.000.00 INVESTMENT T-S LLMOTES 6 OTHER 62,670,000.00 0.00 0.00 37,086,000.00 0.00 0.00 0.00 0.00 99.956,000.00 AUTO MALL CASH LQRP CASH 0.00 0.00 0.00 0.00 0.00 25,449.50 0.00 0.00 0.00 0.00 0.00 25.449.50 BOND REDEMPTION CASH 0.00 0.00 0.00 219.50 0.00 0.00 5.83 0.00 225.33 BOND RESERVE CASH 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 BOND PROJECT CASH 0.00 0.00 0.00 2,393208.26 0.00 0.00 0.00 0.00 2,393,208.25 BOND ESCROW CASH 0.00 0.00 0.00 0.00 0.OD 0.00 0.00 0.00 0.00 PETTY CASH 1000 00 0.00 0 00 0.00 0.00 0.00 0.00 0.00 1,000.00 CASH i INVESTMENT TOTAL 51.142.166.11 0.00 0.00 78,972,118.35 0.00 0.00 5.732.65 0.00 130.120,017.11 INVESTMENT IN LAND HELD FOR RESALE 0.00 0.00 0.00 0.00 0.00 0.00 .0.00 0.00 0.00 ACCOUNTS RECEIVABLE 29,603.53 0.00 0.00 60.900.00 0.00 0.00 0.00 0.00 90.503.53 PREMIUMIDISCOUNT ON INVESTMENT 197,935.80 0.00 0.00 (51.727.79) 0.00 0.00 0.00 0.00 146,207.81 " LORP-ACCOUNTS RECEIVABLE 0.00 0.00 0.00 76271.59 0.00 0.00 0.00 0.00 75,271.59 INTEREST RECEIVABLE 48.358.93 0.00 0.00 0.00 0.00 0.00 0.00 0.00 48,358.93 LOANINOTES RECEIVABLE o.00 0.00 0.00' 12,613,564.62 0.00 0.00 0.00 0.00 12,6W%4.62 DUE FROM OTHER AGENCIES DUE FROM OTHER AGENCIES - CVAG" 3,087257.06 2.M.095.69 0.00 0.00 0.00 0.00 0.00 0.00 0.00 3,007257.06 2,M,096.69 CVAG ALLOWANCE DUE FROM OTHER GOVERNMENTS (2.2WM.89) 44,634.18 0.00 0.00 O.OD OAo 0.00 0.00 0.00 (2,299.096.89) 44,834.18 DUE FROM OTHER FUNDS ADVANCES FROM RDA - PRINCIPAL 0.00 15,597,550.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 O.w 0.00 . 0.00 0.00 0.00 0.00 15.597450.20 ADVANCES FROM RDA - INTEREST 6,951.545.54 0.00 0.00 0.00 0.OD 0.00 0.00 0.00 6,961.545.54 ADVANCES TO OTHER FUNDS 0.00 4.388.80 0.00 moo 6,709,482.94 0.00 0.00 0.00 0.00 0.00 6,709,482.94 4,388.80 NSF CHECKS RECEIVABLE ACCRUED REVENUE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 FIXED ASSETS 0.00 305,249.852.60 305249,852.60 929209.62 ACCUMULATED DEPRECIATION 92%MA2 3.125.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 3.125.00 TRAVEL ADVANCES EMPLOYEE ADVANCES 13,015.70 .0.00 0.00 0.00 0.00 0.OD 0.00 0.00 0.00 13,015.70 PREPAID EXPENSES RECEIVABLE TOTAL 18098 36 0.00 26,934.722.32 305,249.W2.80 0.00 0.00 0.00 19,406.491.36 0.00 0.00 0.00 0.00 o.00 0.00 0.00 18.096.36 0.00 352,592.86628 WORKER COMPENSATION DEPOSIT 234,177.00 0.00 0.00 o.OD 0.00 0.00 0.00 0.00 0.00 0.00 0.00 234.177.00 4,830.OD RENT DEPOSITS 4,830.00 0.00 0.00 0.00 0.00 O.Oo 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 UTILITY DEPOSITS MISC. DEPOSITS 107321 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1.073.21 DEPOSITS TOTAL 240.00021 0.00 0.00 0.00 0.00 0.00 0.00 0.00 240AW.21 ASSETS 0.00 0.00 0.00 0.00 52,066,306.00 0.00 0.00 0.00 52,066,306.00 GENERAL FIXED ACCUMULATED DEPRECATION AMOUNT AVARABLE TO RETIRE L/r DEBT 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 AMOUNT TO BE PROVIDED FOR LIT DEBT 0.00 0.00 1.625,259.95 0.00 0.00 158.480,254.00 1MAM254 00 0.00 0.00 7.190,000.00 7190,000.00 167,275.513.96 219,341,819.96 TOTAL OTHER ASSETS 0.00 0.00 1625259 96 0.00 52 OB6.306 00 TOTAL ASSETS 78 316,988 64 306248 852 80 1625.258 96 98 380 609.71 52,066,306.00 15a,4Q0254A0 5,732.65 7,190,000.00 702294,783.55 LIABILITIES: ACCOUNTS PAYABLE 14A=.84 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 14,422 84 854.539.02 DUE TO OTHER AGENCIES 854AN.02 0.00 0.00 0.00 0.0o 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 DUE TO OTHER FUNDS ADVANCES FROM OTHER FUNDS 6,709.481.94 0.00 0.00 22,559,099.16 0.00 0.00 0.00 0.00 • 29288,581.10 0.00 ACCRUED EXPENSES 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 INTEREST PAYABLE 0.00 185,724.56 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 185,724.56 PAYROLL LL4BILITIES STRONG MOTION INSTRUMENTS 3,198.13 0.00 0.00 0.00 0.00 0.00 000 0.00 0.00 0.00 3,196.13 106,428.00 FRINGE TOED LIZARD FEES 105.426.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 305.00 SUSPENSE DUE TO THE CITY OF LA OUINTA 306.00 0.00 0.00 0.00 0.00 0.00 22,559,099.16 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 30.413,197.65 PAYABLE3 TOTAL 7,854,098.49 0.00 ENGINEERING TRUST DEPOSITS o.o0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 SO. COAST AIR OUALITY DEPOSITS 0.00 0.00 0.00 0.00 0.00 0.00 0.00 18.884.00 0.00 0.00 0.00 0.00 18,664.00 LQRP DEPOSITS DEVELOPER DEPOSITS 1,453.5NV 0.00 . 0.00 2,835.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1AM401.57 148,774.48. MISC. DEPOSITS 121,774.48 1.59E 458.30 0.00 ow 0.00 0.00 25,000.00 ow 0.00 0.00 0 00 0.00 0.00 1.456.30 AGENCY FUND DEPOSITS TOTAL DEPOSITS 3,167,799.35 . 0.00 0.00 46AN-00 0.00 0.00 0.00 0.00 3214.ZW35 DEFERRED REVENUE OTHER LIABILITIES TOTAL 3101290 87 3.101.290:57 0.00 0.00 0.00 0.00 10,495 978 56 10,495,978.56 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 13,597269.43 13,5972M 43 COMPENSATED ABSENCES PAYABLE 0.00 0.00 462260.37 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 462,260.37 654,688.59 DEVELOPER AGREEMENT 0.00 0.00 0.00 0.OD 684.688.59 478.311.00 0.00 0.00 0.00 0.00 0.00 0.00• 478,311.00 DUE TO THE CITY OF LA QUINTA 0.00 0.00 0.00 0.00 0.00 2.150.000.00 0.00 0.00 2,150.000.00 DUE TO COUNTY OF RIVERSIDE 0.00 0.00 0.00 0.00 0.00 7,365254.00 0.00 0.00 7,365250.00 DUE TO C.V. UNIFIED SCHOOL DIST. 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 DUE TO DESERT SANDS SCHOOL DIST. 0.00 0.00 0.00 0.00 0.00 148 945.000.00 0.00 7,190 000.00 156135,000.00 BONDS PAYABLE TOTAL LONG TERM DEBT 0.00 0.00 1.625259.95 0.00 .0.00 153AW.254.00 0.00 7,19D,000.00 167275.513.96 14,123.188.71 0.00 1.625259.98 33,101,576.72 0.00 158,460254.00 0.00 7.190.000.00 214,500279.39 TOTAL LIABILITIES EQUITY -FUND BALANCE 64,193.779.85 306249,652.60 OAO 65279,032.99 52.0 . 56.306.00 0.00 5,732.65 0.00 487,794,504.09 78.316 968 56 306249 852 BD 1 825259 96 98 380 809 71 52 066 305.00 158.460254.00 5,732.a4 7.190.000.00 702ajZ83.48 TOTAL LIABILITY i EQUITY 0.08 0.00 0.00 0.00 0.00 0.00 O.OD 0 DO 0 08 CASH & INVESTMENT TOTAL 130,120.017.11 PREMRIM/DISCOUNT ON INVESTMENT 146,207.81 TOTAL 130266224.92 12 ■ Q N > C — U C ■ � Q N LL � ■ .a 4-- —_ LL N m C C � �C N L— O o W I_ ■ cu N C O C .X U Q � � Q N .0 O C - -- -- ■ Z N O C � ts U n ■ O -v > aD C o - -- ---- — — �° Q - - o 0 a CD n c c •L •L cu m uj LU ■CD N N N CU Q �� �_ C C u4" O ■ 0 0 LO LO N O 0000 CEO. �t N 0 0 LO am'.' 0000 coo d 1- 4UGVJad o 0 0 0 INVESTMENT ADVISORY BOARD Meeting Date: TITLE: June 9, 2004 Continued Consideration of Fiscal Year 2004/05 Investment Policies BACKGROUND: Business Session No. B Pursuant to State Legislation the City investment policies must be approved on an annual basis by the City Council. This approval is done in June of each year. During the last several months, the Board has met to update the City Investment Policy. A strike out version of the Investment Policy has been attached Pursuant to the Investment Policy, the Board meets with the City Manager and City Attorney to discuss the Investment Policy before they are forwarded to the City Council for their consideration. An Executive Summary of the proposed changes to the Investment Policy for FY 04/05 has been attached. RECOMMENDATION: Forward the revised Investment Policy to the City Council for their consideration with an appropriate recommendation. JoIW M . Falconer�,� Finance Director CITY OF LA QUINTA Investment Policy Table of Contents Section Topic Page Executive Summary 2 I General Purpose 4 II Investment Policy 4 III Scope 4 IV Objectives 4 ► Safety ► Liquidity ► Yield ► Diversified Portfolio V Maximum Maturities 6 VI Prudence 6 VII Delegation of Authority 6 Vill Conflict of Interest 7 IX Authorized Financial Dealers and Institutions 7 ► Broker/Dealers ► Financial Institutions X Authorized Investments and Limitations 9 XI Investment Pools 13 Al Safekeeping and Custody 13 XIII Interest Earning Distribution Policy 13 XIV Internal Controls and Independent Auditors 14 XV Benchmark 15 XVI Reporting Standards 15 XVII Financial Assets and Investment Activity Not Subject to this Policy 16 XVIII Investment of Bond Proceeds 16 IX Investment Advisory Board - City of La Quinta 17 XX Investment Policy Adoption 17 Appendices: A. Summary of Authorized Investments and Limitations 18 B. Municipal Code Ordinance 2.70 - Investment Advisory Board 19 C. Municipal Code Ordinance 3.08 - Investment of Moneys and Funds 20 D. Segregation of Major Investment Responsibilities 22 E. Listing of Approved Financial Institutions 23 F. Broker/Dealer Questionnaire and Certification 24 G. Investment Pool Questionnaire 29 H. Glossary 33 1 City of La Quinta Investment Policy Executive Summary The general purpose of this Investment Policy is to provide the rules and standards users must follow in investing funds of the City of La Quinta. It is the policy of the City of La Quinta to invest all public funds in a manner which will provide a diversified portfolio with maximum security while meeting daily cash flow demands and the highest investment return in conformity to all state and local statutes. This Policy applies to all cash and investments of the City of La Quinta, La Quinta Redevelopment Agency and the La Quinta Financing Authority, hereafter referred in this document as the "City". The primary objectives, in order of priority, of the City of La Quinta's investment activity shall be: Safety of principal is the foremost objective of the investment program. Investments of the City of La Quinta shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. The investment portfolio shall be designed with the objective of attaining a market rate of return or yield throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Within the constraints of safety, liquidity and yield, the City will endeavor to maintain a diversified portfolio by allocating assets between different types of investments within policy limitations. Investments shall be made with judgment and care - under circumstances then prevailing - which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be deriveo. Authority to manage the City of La Quinta's investment portfolio is derived from the City Ordinance. Management responsibility for the investment program is delegated to the City Treasurer, who shall establish and implement written procedures for the operation of the City's investment program consistent with the Investment Policy. The Treasurer shall establish and implement a system of internal controls to maintain the safety of the portfolio. In addition, the internal control system will also insure the timely preparation and accurate reporting of the portfolio financial information. As 2 part of the annual audit of the City of La Quinta's financial statements the independent auditor reviews the adequacy of those controls and comments if weaknesses are found. Investment responsibilities carry added duties of insuring that investments are made without improper influence or the appearance to a reasonable person of questionable or improper influence. The City of La Quinta Investment Policy maintains a listing of financial institutions which are approved for investment purposes. All Broker/Dealers and financial institutions selected by the Treasurer to provide investment services will be approved by the City Manager subject to City Council approval. The Treasurer will be permitted to invest only in City approved investments up to the maximum allowable percentages or dollar limitations and, where applicable, through the bid process requirements. Authorized investment vehicles and related maximum portfolio positions are listed in Appendix A - Summary of Authorized Investments and Limitations. At least two bids will be required of investments in the authorized investment vehicles. Collateral ization will be required for Certificates of Deposits in excess of $100,000. Collateral will always be held by an independent third party from the institution that sells the Certificates of Deposit to the City. Evidence of compliance with State Collateral ization policies must be supplied to the City and retained by the City Treasurer. The City of La Quinta Investment Policy shall require that each individual investment have a maximum maturity of two years unless specific approval is authorized by the City Council, except the projected annual dollar amount as detailed in Section V, may be invested in U.S. Treasury bills, notes and bonds maturing between 2 and 5 years. In addition, the City's investment in the State Local Agency Investment Fund (LAIF) is allowable as long as the average maturity does not exceed two years, unless specific approval is authorized by the City Council. The City's investment in Money Market Mutual funds is allowable as long as the average maturity does not exceed 60 days. The City of La Quinta Investment Policy will use the six-month U.S. Treasury Bill as a benchmark when measuring the performance of the investment portfolio. The Investment Policies shall be adopted by resolution of the La Quinta City Council on an annual basis. The Investment Policies will be adopted before the end of June of each year. This Executive Summary is an overall review of the City of La Quinta Investment Policies. Reading this summary does not constitute a complete review, which can only be accomplished by reviewing all the pages. 3 EIMM22-3 P.O. Box 1504 78-495 CALLE TAMPICO LA QUINTA, CALIFORNIA 92253 City of La Quinta Statement of Investment Policy July 1, 2003 through June 30, 2004 Adopted by the City Council on June 17, 2003 GENERAL PURPOSE (760) 7 7 7 - 7 0 0 0 FAX (760) 777-7101 The general purpose of this document is to provide the rules and standards users must follow in administering the City of La Quinta cash investments. II INVESTMENT POLICY It is the policy of the City of La Quinta to invest public funds in a manner which will provide a diversified portfolio with safety of principal as the primary objective while meeting daily cash flow demands with the highest investment return. In addition, the Investment Policy will conform to all State and local statutes governing the investment of public funds. III SCOPE This Investment Policy applies to all cash and investments, except as further detailed in Section XVII of the City of La Quinta, City of La Quinta Redevelopment Agency and the City of La Quinta Financing Authority, hereafter referred in this document as the "City". These funds are reported in the City of La Quinta Comprehensive Annual financial Report (CAFR) and include: All funds within the following fund types: ► General ► Special Revenue ► Capital Projects ► Debt Service ► Internal Service ► Trust and Agency ► Any new fund types and fund(s) that may be created. IV OBJECTIVES The primary objective, in order of priority, of the City of La Quinta's investment activity shall be: 4 1. Safety Safety of principal is the foremost objective of the investment program. Investments of the City of La Ouinta shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio in accordance with the permitted investments. The objective will be to mitigate credit risk and interest rate risk. A. Credit Risk Credit Risk - is the risk of loss due to the failure of the security issuer or backer. Credit risk may be mitigated by: ► Limiting investments to the safest types of securities; ► Pre -qualifying the financial institutions, and broker/dealers, which the City of La Quinta will do business ; and ► Diversifying the investment portfolio so that potential losses on individual securities will be minimized. B. Interest Rate Risk Interest Rate risk is the risk that the market value of securities in the portfolio will fall due to changes in general interest rates. Interest rate risk may be mitigated by: ► Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity; and ► By investing operating funds primarily in shorter -term securities. 2. Liquidity The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring . the portfolio so that sufficient liquid funds are available to meet anticipated demands. Furthermore since all possible cash demands cannot be anticipated the portfolio should be diversified and consist of securities with active secondary or resale markets. Securities shall not be sold prior to maturity with the following exceptions: ► A declining credit quality security could be sold early to minimize loss of principal; ► Liquidity needs of the portfolio require that the security be sold. 3. Yield The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into 5 account the investment risk constraints and liquidity needs. Return on investment is of least importance compared to the safety and liquidity objectives described above. The core of investments are limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed 4. Diversified Portfolio Within the constraints of safety, liquidity and yield, the City will endeavor to maintain a diversified portfolio by allocating assets between different types of investments within policy limitations. V MAXIMUM MATURITIES It is the policy of the City of La Quinta to hold securities and other investments of cash in financial instruments until maturity, thus avoiding the risk that the market value on investments fluctuates with overall market interest rates. The hold until maturity policy shall not prevent the sale of a security to minimize loss of principal when the issuer or backer suffers declining credit worthiness. The hold until maturity policy requires that the City of La Quinta's investment portfolio is structured so that sufficient funds are available from maturing investments and other sources to meet anticipated cash needs. To meet anticipated cash needs, it is essential that the Treasurer have reasonably accurate, diligently prepared cash flow projections. Annually, the Treasurer shall project the amount of funds not expected to be disbursed within five years. For FY 2003/04, the amount of such funds was $5 million. Funds up to that amount may be invested in U.S. Treasury bills, notes and bonds maturing between 2 and 5 years. For all other funds, investments are limited to two years maximum maturity. VI PRUDENCE The City shall follow the Uniform Prudent Investor Act as adopted by the State of California in Probate Code Sections 16045 through 16054. Section 16053 sets forth the terms of a prudent person which are as follows: Investments shall be made with judgment and care- under circumstances then prevailing - which persons of prudence, discretion, and intelligence exercise in the professional management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. VII DELEGATION OF AUTHORITY Authority to manage the City of La Quinta's investment portfolio is derived from the City Ordinance. Management responsibility for the investment program is delegated to h written procedures for the operation of the e Investment Policy. Procedures should include :r agreements, banking service contracts, and h procedures shall include explicit delegation of testment transactions. No person may engage s provided under the terms of this Investment by the City Treasurer. The City Treasurer shall ;rtaken and shall establish a system of controls s officials. The City Manager or Assistant City ties of insuring that investments are made nce of improper influence. amity Manager, and the City Treasurer shall Economic Interest and to the following: Manager, and the City Treasurer shall not maintain any accounts, interest, or private h the City places investments, with the exception of regular savings, checking and money market accounts, or other similar transactions that are offered on a non-negotiable basis to the general public. Such accounts shall be disclosed annually to the City Clerk in conjunction with annual disclosure statements of economic interest. ► All persons authorized to place or approve investments shall report to the City Clerk kinship relations with principal employees of firms with which the City places investments. IX AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS The City of La Quinta Investment Policy maintains a listing of financial institutions which are approved for direct investment purposes. I-n addition a list will also be maintained of approved broker/dealers selected by credit worthiness, who maintain an office in the State of California. N 1. Broker/Dealers who desire to become bidders for Ml investment transactions must supply the City of La Quinta with the following: ► Current audited financial statements ► Proof of National Association of Security Dealers Certification ► Trading resolution ► Proof of California registration ► Resume of Financial broker ► Completion of the City of La Quinta Broker/Dealer questionnaire which contains a certification of having read the City of La Quinta Investment Policy The City Treasurer shall evaluate the documentation submitted by the broker/dealer and independently verify existing reports on file for any firm and individual conducting investment related business. The City Treasurer will also contact the following agencies during the verification process: ► National Association of Security Dealer's Public Disclosure Report File - 1-800-289-9999 ► State of California Department of Corporations 1-916-445-3062 All Broker/Dealers selected by the City Treasurer to provide investment services will be approved by the City Manager subject to City Council approval. The City Attorney will perform a legal review of the trading resolution/investment contract submitted by each Broker/Dealer. Each securities dealer shall provide monthly and quarterly reports filed pursuant to U.S. Treasury Department regulations. Each mutual fund shall provide a prospectus and statement of additional information. 2. Financial Institutions will be required to meet the following criteria in order to receive City funds for deposit or investment: A. Insurance - Public Funds shall be deposited only in financial institutions having accounts insured by the Federal Deposit Insurance Corporation (FDIC) B. Collateral - The amount of City of La Quinta deposits or investments not insured by the FDIC -shall be 1 10% collateralized by securities' or 150% mortgages' market values of that amount of invested funds plus unpaid interest earnings. C. Disclosure- Each financial institution maintaining invested funds in excess of the FDIC insured amount shall furnish the City a copy of the most recent Annual Call Report. The City shall not invest in excess of the FDIC insured amount in banking institutions which do not disclose to the city a current listing of securities pledged for collateralization in public monies. X AUTHORIZED INVESTMENTS AND LIMITATIONS The City Treasurer will be permitted to invest in the investments summarized in the Appendix A. I. STATE OF CALIFORNIA AND CITY OF LA QUINTA LIMITATIONS As provided in Sections 16429.1, 53601, 53601.1, and 53649 of the Government Code, the State of California limits the investment vehicles available to local agencies as summarized in the following paragraphs. Section 53601, as now amended, provides that unless Section 53601 specifies a limitation on an investment's maturity, no investments with maturities exceeding five years shall be made. The City of La Quinta Investment Policy has specified that no investment may exceed two years, except the projected annual dollar amount, as detailed in Section V, may be invested in U.S. Treasury bills, notes and bonds maturing between 2 and 5 years. State Treasurer's Local Agency Investment Fund (LAIF) - As authorized in Government Code Section 16429.1 and by LAIF procedures, local government agencies are each authorized to invest a maximum of $40 million per account in this investment program administered by the California State Treasurer. The City's investment in the State Local Agency Investment Fund (LAIF) is allowable as long as the average maturity of its investment portfolio does not exceed two years, unless specific approval is authorized by the City Council. The City of La Quinta has two accounts with LAIF. The City of La Quinta Investment Policy has a limitation of 25% of the portfolio. U.S. Government and Related Issues - As authorized in Government Code Sections 53601 (a) through (n) as they pertain to surplus funds, this category includes a wide variety of government securities which include the following: • Local government bonds or other indebtedness and State bonds or other indebtedness. The City of La Quinta Investment Policy does not allow investments in local and state indebtedness • U.S. Treasury bills, notes and bonds and Government National Mortgage Association (GNMA) securities directly issued and backed by the full faith and credit of the U.S. Government. The City of La Quinta Investment Policy limits investments in U.S. Treasury issues and GNMA to 100% of the portfolio. K • U.S. Government instrumentalities and agencies commonly referred to as government sponsored enterprises (GSEs), issuing securities not backed as to principal and interests by the full faith and credit of the U.S. Government. Publicly owned GSEs include Federal National Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC) and Student Loan Marketing Association (SLMA). Non -publicly owned GSEs include the Federal Home Loan Bank (FHLB), Federal Farm Credit Bank (FFCB), Federal Land Bank (FLB) and Federal Intermediate Credit Bank (FICB). The City of La Quinta Investment Policy allows investment only in securities of FNMA, FHLMC, FHLB and FFCB and has a limitation of $7.6 ON million face amount for each issuer. Bankers' Acceptances - As authorized in Government Code Section 53601 (f), 40% of the portfolio may be invested in Bankers' Acceptances, although no more than 30% of the portfolio may be invested in Bankers' Acceptances w ith any one commercial bank. Additionally, the maturity period cannot exceed 180 days. The City of La Quinta Investment Policy does not allow investment in Bankers' Acceptances. Commercial Paper - As authorized in Government Code Section 53601(g), 15% of the portfolio may be invested in commercial paper of the highest rating (A-1 or P 1) as rated by Moody' s or Standard and Poor' s, with maturities not to exceed 270 days. This percentage may be increased to 30% if the dollar weighted average maturity does not exceed 31 days. There are a number of other qualifications regarding investments in commercial paper based on the financial strength of the corporation and the size of the investment. The City of La Quinta' s Investment Policy follows The Government Code with the following additional limitations: (1) maximum maturity per issue of 90 days and (2) a maximum of $3 million per issuer. Negotiable Certificates of Deposit - As authorized in Government Code Section 53601(h), 30% of the portfolio may be invested in negotiable certificates of deposit issued by commercial banks and savings and loan associations. The City of La Quinta Investment Policy does not allow investment in Negotiable Certificates of Deposit. Repurchase and Reverse Repurchase Agreements - As authorized in Government Code Section 53601(i), these investment vehicles are agreements between the local agency and seller for the purchase of government securities to be resold at a specific date and for a specific amount. Repurchase agreements are generally used for short term investments varying from one day to two weeks. There is no legal limitation on the amount of the repurchase agreement. However, the maturity period cannot exceed one year. The market value of securities underlying a repurchase agreement shall be at least 102% of the funds invested and shall be valued at least quarterly. 10 The City of La Quinta Investment Policy does not allow investment in Repurchase Agreements. The term "reverse repurchase agreement" means the sale of securities by the local agency pursuant to an agreement by which the local agency will repurchase such securities on or before a specific date and for a specific amount. As provided in Government Code Section 53635, reverse repurchase agreements require the prior approval of the City Council. The City of La Quinta Investment Policy does not allow investment in Reverse Repurchase Agreements. Diversified Management Companies - As authorized in Government Code Section 53601(k), local agencies are authorized to invest in shares of beneficial interest issued by diversified management companies (mutual funds) in an amount not to exceed 20% of the agency's portfolio. There are a number of other qualifications and restrictions regarding allowable investments in corporate notes and shares of beneficial interest issued by mutual funds which include (1) attaining the highest ranking or the highest letter and numerical rating provided by not less than two of the three largest nationally recognized rating services, or (2) having an investment advisor registered with the Securities and Exchange Commission with not less than five years' experience investing in the securities and obligations and with assets under management in excess of five hundred million dollars ($500,000,000). The City of La Quinta Investment Policy only allows investments in mutual funds that are money market funds maintaining a par value of $1 per share that invests in direct issues of the U.S. Treasury and/or US Agency Securities with an average maturity of their portfolio not exceeding 90 days and the City limits such investments to 20% of the portfolio. Mortgage -Backed Securities - As authorized in Government code Section 53601(n), local agencies may invest in mortgage -backed securities such as mortgage pass -through securities and collateralized mortgage obligations for a 11 maximum period of five years in an amount not to exceed 20% of the agency' s portfolio. Securities eligible for investment shall have a "A" or higher rating. The City of La Quinta Investment Policy does not allow investment in Mortgage - Backed Securities. Financial Futures and Financial Option Contracts - As authorized in Government Code Section 53601.1, local agencies may invest in financial futures or option contracts in any of the above investment categories subject to the same overall portfolio limitations. The City of La Quinta Investment Policy does not allow investments in financial futures and financial option contracts. Certificates of Deposit - As authorized in Government Code Section 53649, Certificates of Deposit are fixed term investments which are required to be collateralized from 1 10% to 150% depending on the specific security pledged as collateral in accordance with Government Code Section 53652. There are no portfolio limits on the amount or maturity for this investment vehicle. Collateralization will be required for Certificates of Deposits in excess of the FDIC insured amount. The type of collateral is limited to City authorized investments. Collateral will always be held by an independent third party from the institution that sells the Certificates of Deposit to the City. Evidence of compliance with State Collateralization policies must be supplied to the City and retained by the City Treasurer as follows: 1. Certificates of Deposits Insured by the FDIC. The City Treasurer may waive collateral ization of a deposit that is federally insured. 2. Certificates of Deposit in excess of FDIC Limits. The amount not federally insured shall be 1 10% collateralized securities or 150% mortgages market value of that amount of invested funds plus unpaid interest earnings. The City of La Quinta Investment Policy limits the percentage of Certificates of Deposit to 60% of the portfolio. Sweep Accounts - As authorized by the City Council, a U.S. Treasury and/or U.S. Agency Securities Money Market Sweep Account with a $50,000 target balance may be maintained in conjunction with the checking account. Derivatives - The City of La Quinta Investment Policy does not allow investment in derivatives. 12 XI INVESTMENT POOLS There are three (3) types of investment pools: 1) state -run pools, 2) pools that are operated by a political subdivision where allowed by law and the political subdivision is the trustee i.e. County Pool; and 3) pools that are operated for profit by third parties. The City of La Quinta Investment Policy has authorized investment with the State of California' s Treasurers Office Local Agency Investment Fund commonly referred to as LAIF. LAW was organized in 1977 through State Legislation Section 16429.1, 2 and 3. Each LAIF account is restricted to a maximum investable limit of $40 million. In addition, LAIF will provide quarterly market value information to the City of La Quinta. On an annual basis the City Treasurer will submit the Investment Pool Questionnaire to LA I F. Also, prior to opening any new Investment Pool account, which would require City Council approval, the City Treasurer will require the completion of the Investment Pool Questionnaire. XII SAFEKEEPING AND CUSTODY All security transactions of the City of La Quinta Investment Policy shall be conducted on a delivery - versus - payment (DVP) basis. Securities will be held by a third party custodian designated by the City Treasurer and evidenced by safekeeping receipts. Deposits and withdrawals of money market mutual funds and LAIF shall be made directly to the entity and not to an investment advisor, broker or dealer. Money market mutual funds and LAW shall also operate on a DVP basis to be considered for investment. XIII INTEREST EARNING DISTRIBUTION POLICY Interest earnings are generated from pooled investments and specific investments. 1. Pooled Investments - It is the general policy of the City to pool all available operating cash of the City of La Quinta, La Quinta Redevelopment Agency and La Quinta Financing Authority and allocate interest earnings, in the following order, as follows: A. Payment to the General Fund of an amount equal to the tonal annual bank service charges as incurred by the general fund for all operating funds as included in the annual operating budget. B. Payment to the General Fund of a management fee equal to 5% of the annual pooled cash fund investment earnings. 13 C. Payment to each fund of an amount based on the average computerized daily cash balance included in the common portfolio for the earning period. 2. Specific Investments - Specific investments purchased by a fund shall incur all earnings and expenses to that particular fund. XIV INTERNAL CONTROLS AND INDEPENDENT AUDITOR The City Treasurer shall establish a system of internal controls to accomplish the following objectives: ► Safeguard assets; ► The orderly and efficient conduct of its business, including adherence to management policies; ► Prevention or detection of errors and fraud; ► The accuracy and completeness of accounting records; and, ► Timely preparation of reliable financial information. While no internal control system, however elaborate, can guarantee absolute assurance that the City's assets"are safeguarded, it is the intent of the City's internal control to provide a reasonable assurance that management of the investment function meets the City's objectives. The internal controls shall address the following: a. Control of collusion. Collusion is a situation where two or more employees are working in conjunction to defraud their employer. b. Separation of transaction authority from accounting and record keeping. By separating the person who authorizes or performs the transaction from the people who record or otherwise account for the transaction, a separation of duties is achieved. C. Custodial safekeeping. Securities purchased from any bank or dealer including appropriate collateral (as defined by State Law) shall be placed with an independent third party for custodial safekeeping. d. Avoidance of physical delivery securities. Book entry securities are much easier to transfer and account for since actual delivery of a document never takes place. Delivered securities must be properly safeguarded against loss or destruction. The potential for fraud and loss increases with physically delivered securities. e. Clear delegation of authority to subordinate staff members. Subordinate staff members must have a clear understanding of their authority and responsibilities to avoid improper actions. Clear delegation of authority also preserves the 14 internal control structure that is contingent on the various staff positions and their respective responsibilities as outlined in the Segregation of Major Investment Responsibilities appendices. f. Written confirmation or telephone transactions for investments and wire transfers. Due to the potential for error and improprieties arising from telephone transactions, all telephone transactions shall be supported by written communications and approved by the appropriate person. Written communications may be via fax if on letterhead and the safekeeping institution has a list of authorized signatures. Fax correspondence must be supported by evidence of verbal or written follow-up. g. Development of a wire transfer agreement with the City's bank and third party custodian. This agreement should outline the various controls, security provisions, and delineate responsibilities of each party making and receiving wire transfers. The System of Internal Controls developed by the City, shall be reviewed annually by the independent auditor in connection with the annual audit of the City of La Quinta's Financial Statements. The independent auditor's management letter comments pertaining to cash and investments, if any, shall be directed to the City Manager who will direct the City Treasurer to provide a written response to the independent auditor's letter. The management letter comments pertaining to cash and investment activities and the City Treasurer's response shall be provided to the City's Investment Advisory Board for their consideration. Following the completion of each annual audit, the independent auditor shall meet with the Investment Advisory Board and discuss the auditing procedures performed and the review of internal controls for cash and investment activities. XV BENCHMARK The investment portfolio shall be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles commensurate with the investment risk constraints and the cash flow needs of the City. Return on investment is of least importance compared to safety and liquidity objectives. The City of La Quinta Investment Policy will use the six-month U.S. Treasury Bill as a benchmark when measuring the performance of the investment portfolio. XVI REPORTING STANDARDS SB564 section 3 requires a quarterly report to the Legislative Body of Investment activities. The City of La Quinta Investment Advisory Board has elected to report the investment activities to the City Council on a monthly basis through the Treasurers Report. AB 943 requires that the December 31 st and June 30' Treasurers Reports be 15 sent to the California Debt and Advisory Commission within sixty days of the end of the quarter. The City Treasurer shall submit a monthly Treasurers Report to the City Council and the Investment Advisory Board that includes all cash and investments under the authority of the Treasurer. The Treasurers Report shall summarize cash and investment activity and changes in balances and include the following: ► A certification by City Treasurer; ► A listing of Purchases and sales/maturities of investments; ► Cash and Investments categorized by authorized investments, except for LAIF which will be provided quarterly and show yield and maturity; ► Comparison of month end actual holdings to Investment Policy limitations; ► Current year and prior year monthly history of cash and investments for trend analysis; ► Balance Sheet; ► Distribution of cash and investment balances by fund; ► A comparison of actual and surplus funds; ► A year to date historical cash flow analysis and projection for the next six months; ► A two-year list of historical interest rates. XVII FINANCIAL ASSETS AND INVESTMENT ACTIVITY NOT SUBJECT TO THIS POLICY The City' s Investment Policy does not apply to the following: • Cash and Investments raised from Conduit Debt Financing; • Funds held in trust in the City' s name in pension or other post -retirement benefit programs; • Cash and Investments held in lieu of retention by banks or other financial institutions for construction projects; • Short or long term loans made to other entities by the City or Agency; and, • Short term (Due to/from) or long term (Advances from/to) obligations made either between the City and its funds or between the City and Agency. VVIII INVESTMENT OF BOND PROCEEDS The City' s Investment Policy shall govern bond proceeds and bond reserve fund investments. California Code Section 5922 (d) governs the investment of bond proceeds and reserve funds in accordance with bond indenture provisions which shall be structured in accordance with the City' s Investment Policy. 4 16 Arbitrage Requirement The US Tax Reform Act of 1986 requires the City to perform arbitrage calculations as required and return excess earnings to the US Treasury from investments of proceeds of bond issues sold after the effective date of this law. This arbitrage calculations may be contracted with an outside source to provide the necessary technical assistance to comply with this regulation. Investable funds subject to the 1986 Tax Reform Act will be kept segregated from other funds and records will be kept in a fashion to facilitate the calculations. The City's investment position relative to the new arbitrage restrictions is to continue pursuing the maximum yield on applicable investments while ensuring the safety of capital and liquidity. It is the City's position to continue maximization of yield and to rebate excess earnings, if necessary. WIN INVESTMENT ADVISORY BOARD - CITY OF LA QUINTA The Investment Advisory Board (IAB) consists of five members of the community that have been appointed by and report to the City Council. The IAB usually meets on a monthly basis, but at least quarterly to (1) review at least annually the City's Investment Policy and recommend appropriate changes; (2) review monthly Treasury Report and note compliance with the Investment Policy and adequacy of cash and investments for anticipated obligations; (3) receive and consider other reports provided by the City Treasurer; (4) meet with the independent auditor after completion of the annual audit of the City's financial statements, and receive and consider the auditor' s comments on auditing procedures, internal controls and findings for cash and investment activities, and; (5) serve as a resource for the City Treasurer on matters such as proposed investments, internal controls, use or change of financial institutions, custodians, brokers and dealers. The appendices include City of La Quinta Ordinance 2.70 entitled Investment Advisory Board Provisions. XX INVESTMENT POLICY ADOPTION On an annual basis, the Investment policies will be initially reviewed by the Investment Advisory Board and the City Treasurer. The Investment Advisory Board will forward the Investment policies, with any revisions, to the City Manager and City Attorney for their review and comment. A joint meeting will be held with the Investment Advisory Board, City Manager, City Attorney, and City Treasurer to review the Investment policies and comments, prior to submission to the City Council for their consideration. The Investment Policies shall be adopted by resolution of the City of La Quinta City Council on an annual basis. The Investment Policies will be adopted before the end of June of each year. AB 943 requires that the Investment Policies be sent to the California Debt and Investment Advisory Commission within sixty days of a change to the Investment Policy. 17 Appendix B Chapter 2.70 INVESTMENT ADVISORY BOARD PROVISIONS Sections: 2.70.010 General Rules Regarding Appointment. 2.70.020 Board meetings. 2.70.030 Board functions. 2.70.010 General rules regarding appointment A. Except as set out below, see Chapter 2.06 for General Provisions. B. The Investment Advisory Board (the"board") is a standing board composed of five (5) members from the public that are appointed by city council. La Quinta residency is required except for Board Members currently serving on the Board as of June 30, 2003 C. Background in the investment field and/or related •experience is preferred. Background information will be required and potential candidates must agree to a background check and verification. D. On an annual basis, in conjunction with the Political Reform Act disclosure statutes, or at any time if a change in circumstances warrants, each board member will provide the City Council with a disclosure statement which identifies any matters that have a bearing on the appropriateness of that member's service on the board. Such matters may include, but are not limited to, changes in employment, changes in residence, or changes in clients. 2.70.020 Board meetings. The Board usually will meet monthly, but this schedule may be extended to quarterly meetings upon the concurrence of the Board and the City Council. The specific meeting dates will be determined by the Board Members and meetings may be called for on an as needed basis. 2.70.030 Board functions. 1. The principal functions of the Board are: (1) review at least annually the City's Investment Policy and recommend appropriate changes; (2) review monthly Treasury Report and note compliance with the Investment Policy and adequacy of cash and investments for anticipated obligations; (3) receive and consider other reports provided by the City Treasurer; (4) meet with the independent auditor after completion of the annual audit of the City's financial statements, and receive and consider the auditor's comments on auditing procedures, internal controls, and findings for cash and investment activities, and; (5) serve as a resource for the City Treasurer on matters such as proposed investments, internal controls, use or change of financial institutions, custodians, brokers and dealers. 2. The Board will report to the City Council after each meeting either in person or through correspondence at a regular City Council meeting. 19 _`s :a 'E � N A � 8 TE y N k O -a U O LL 0 LL a oN N N 7 jp wt a10i N Ex2 m lgg- 2 N N N N N N N N N Of N N m wN4 0 0 a41 C c 0) x y Q 3 E j m > 3 > m E � E 25 $ M N c IBME v N p g E LO .Q O O E CO LO LL a a O a a a O a .� fn CO p 8 •- - p O r- p S a0 p 8 a0 � eJQ� < M AQ' S2 Q 5'� Q z85 285 2S5 285 2 ,� 5 E l6 U. a 2e a a p a O O O O O O O O a a d N �j -As �g 00 UD bb y N tD N a N a cn $a La Lo c E �$i UUS o >g LL U. LL m N mffi�3 LLLL g s£ - » q N am$ d tf Q m o m��U0� �0,c$EQE�gEp � � �iE�� � o ffi 0 EoE2SLLS E 0 yai < o - +c m p 41 iB ie 70 � C7 QQ E � L �` � N aZi E (n N (7 LL C NCO O M j E a v 5 m U ti N eN a p m M M E d E IS2 m 0' 'E< ER 0�+ <tL �� mz�iaaid� Appendix A 3 o PE! n E 0 E� L 9 a C W g g. 12 $� Ya � e E� aLL 0 a �i e QK c< o� to a E Q g Appendix C Chapter 3.08 INVESTMENT OF MONEYS AND FUNDS Sections: 3.08.010 Investment of city moneys and deposit of securities. 3.08.020 Authorized investments. 3.08.030 Sales of securities. 3.08.040 City bonds. 3.08.050 Reports. 3.08.060 Deposits of securities. 3.08.070 Trust fund administration. 3.08.010 Investment of city moneys and deposit of securities. Pursuant to, and in accordance with, and to the extent allowed by, Sections 53607 and 53608 of the Government Code, the authority to invest and reinvest moneys of the city, to sell or exchange securities, and to deposit them and provide for their safekeeping, is delegated to the city treasurer. (Ord. 2 § 1 (part), 1982) 3.08.020 Authorized investments. Pursuant to the delegation of authority in Section 3.08.010, the city treasurer is authorized to purchase, at their original sale or after they have been issued, securities which are permissible investments under any provision of state law relating to the investing of general city funds, including but not limited to Sections 53601 and 53635 of the Government Code, as said sections now read or may hereafter be amended, from moneys in his custody which are not required for the immediate necessities of the city and as he may deem wise and expedient, and to sell or exchange for -other eligible securities and reinvest the proceeds of the securities so purchased. (Ord. 2 § 1 (part), 1982) 3.08.030 Sales of Securities. From time to time the city treasurer shall sell the securities in which city moneys have been invested pursuant to this chapter, so that the proceeds may, as appropriate, be applied to the purchase for which the original purchase money may have been designated or placed in the city treasury. (Ord.2 § I (part), 3.08.040 City bonds. Bonds issued by the city and purchased pursuant to this chapter may be canceled either in satisfaction of sinking fund obligations or otherwise if proper and appropriate; provided, however, that the bonds may be held uncancelled and while so held may be resold. (Ord. 2 § 1 (part), 1982) 20 3.08.050 Reports. The city treasurer shall make a monthly report to the city council of all investments made pursuant to the authority delegated in this chapter. (Ord. 2 § 1 (part), 1982) 3.08.060 Deposits of securities. Pursuant to the delegation of authority in Section 3.08.010, the city treasurer is authorized to deposit for safekeeping, the securities in which city moneys have been invested pursuant to this chapter, in any institution or depository authorized by the terms of any state law, including but not limited to Section 53608 of the Government Code as it now reads or may hereafter be amended. In accordance with said section, the city treasurer shall take from the institution or depository a receipt for the securities so deposited and shall not be responsible for the securities delivered to and receipted for by the institution or depository until they are withdrawn therefrom by the city treasurer. (Ord. 2 § 1 (part), 1982 3.08.070 Trust fund administration. Any departmental trust fund established by the city council pursuant to Section 36523 of the Government Code shall be administered by the city treasurer in accordance with Section 36523 and 26524 of the Government code and any other applicable provisions of law. (Ord. 2 § 1 (part), 1982) 21 Appendix D SEGREGATION OF MAJOR INVESTMENT RESPONSIBILITIES Function Responsibilities Develop formal Investment Policy City Treasurer Recommend modifications to Investment Policy Investment Advisory Board Review formal Investment Policy and recommend City Manager and City Council action City Attorney Adopt formal Investment Policy City Council Review Financial Institutions & Select Investments City Treasurer Approve investments City Manager or Assistant City Manager Execute investment transactions City Manager or Treasurer Confirm wires, if applicable Accounting Manager or Financial Services Assistant Record investment transactions in City's Accounting Manager or accounting records Financial Services Assistant Investment verification - match broker confirmation City Treasurer and Financial to. City investment records Services Assistant Reconcile investment records - to accounting records and bank statements Reconcile investment records - to Treasurers Report of investments Security of investments at City Security of investments Outside City Review internal control procedures 22 Financial Services Assistant Accounting Manager Vault Third Party Custodian External Auditor ■ Appendix E LISTING OF APPROVED FINANCIAL INSTITUTIONS 1. Banking Services - Wells Fargo Bank, Government Services, Los Angeles, California 2. Custodian Services - Bank of New York, Los Angeles, California 3. Deferred Compensation - International City/County Management Association Retirement Corporation 4. Broker/Dealer Services - Merrill Lynch, Los Angeles, CA Morgan Stanley, Los An eles, California Newport Beach, CA 5. Government Pool - State of California Local Agency Investment Fund City of La Quinta Account La Quinta Redevelopment Agency No Changes to this listing may be made without City Council approval 23 Appendix F BROKER/DEALER QUESTIONNAIRE AND CERTIFICATION 1. Name of Firm: 2. Address: 3. 0 5. Telephone: ( ) ( ) Broker's Representative to the City (attach resume) : Name: Title: Telephone: ( ) Manager/Partner-in-charge (attach resume): Name: Title: Telephone: 6. List all personnel who will be trading with or quoting securities to City employees (attach resume) Name: Title: Telephone: ( ) ( ) 7. Which of the above personnel have read the City's Investment Policy? 8. Which instruments are offered regularly by your local office? (Must equal 100%) % U.S. Treasuries % Repos % BA's % Reverse Repos % Commercial Paper % CMO's % CD's % Derivatives % Mutual Funds % Stocks/Equities % Agencies (specify) : % Other (specify) : 24 9. References -- Please identify your most directly comparable public sector clients in our geographical area. Entity Contact Telephone ( ) Client Since Entity Contact Telephone Client Since 10. Have any of your clients ever sustained a loss on a securities transaction arising from a misunderstanding or misrepresentation of the risk characteristics of the instrument? If so, explain. 12. Has your firm or your local office ever been subject to a regulatory or state/ federal agency investigation for alleged improper, fraudulent, disreputable or unfair activities related to the sale of securities? Have any of your employees been so investigated? If so, explain. Has a client ever claimed in writing that you were responsible for an investment loss? Yes No If yes, please provide action taken Has a client ever claimed in writing that your firm was responsible for an investment loss? Yes No If yes, please provide action taken 25 Do you have any current or pending complaints that are unreported to the NASD? Yes No If yes, please provide action taken Does your firm have any current, or pending complaints that are unreported to the NASD? Yes No If yes, please provide action taken 13. Explain your clearing and safekeeping procedures, custody and delivery process. Who audits these fiduciary responsibilities? Latest Audit Report Date 14. How many and what percentage of your transactions failed. Last month? % $ Last year? % $ 15. Describe the method your firm would use to establish capital trading limits for the City of La Quinta. ffe-1 Is your firm a member in the S.I.P.C. insurance program. Yes If yes, explain primary and excess coverage and carriers. 17. What portfolio information, if any, do you require from your clients? NLV we 18. What reports and transaction confirmations or any other research publications will the City receive? 19. Does your firm offer investment training to your clients? Yes No 20. Does your firm have professional liability insurance. Yes No If yes, please provide the insurance carrier, limits and expiration date. 21. 22. Please list your NASD Registration Number, Do you have any relatives who work at the City of La Quinta? Yes No If yes, Name and Department 23. Do you maintain an office in California. Yes . No 24. Do you maintain an office in La Quinta or Riverside County? Yes No 25. Please enclose the following: X Latest audited financial statements. X Samples of reports, transaction confirmations and any other research/publications the City will receive. X Samples of research reports and/or publications that your firm regularly provides to clients. X Complete schedule of fees and charges for various transactions. 'CERTIFICATION' *CERTIFICATION* I hereby certify that I have personally read the Statement of Investment Policy of the City of La Quinta, and have implemented reasonable procedures and a system of controls designed to preclude imprudent investment activities arising out of transactions conducted between our firm and the City of La Quinta. All sales personnel will be routinely informed of the City's investment objectives, horizons, outlooks, strategies and risk constraints whenever we are so advised by the City. We pledge to exercise due diligence in informing the City of La Quinta of all foreseeable risks associated with financial transactions conducted with our firm. By signing this document the City of La Quinta is authorized to conduct any and all background checks. 27 Under penalties of perjury, the responses to this questionnaire are true and accurate to the best of my knowledge. Broker Date_ Sales Date Representative Manager and/or Title Managing Title Partner* WP Appendix G INVESTMENT POOL QUESTIONNAIRE Note: This Investment Pool Questionnaire was developed by the Government Finance Officers Association (GFOA). Prior to entering a pool, the.following questions and issues should be considered. SECURITIES Government pools may invest in a broader range of securities than your entity invests in. It is important that you are aware of, and are comfortable with, the securities the pool buys. 1. Does the pool provide a written statement of Investment Policy and objectives? 2. Does the statement contain: a. A description of eligible investment instruments? b. The credit standards for investments? c. The allowable maturity range of investments? d. The maximum allowable dollar weighted average portfolio maturity? e. The limits of portfolio concentration permitted for each type of security? f. The policy on reverse repurchase agreements, options, short sales and futures? 3. Are changes in the policies communicated to the pool participants? 4. Does the pool contain only the types of securities that are permitted by your Investment Policy? INTEREST Interest is not reported in a standard format, so it is important that you know how interest is quoted, calculated and distributed so that you can make comparisons with other investment alternatives. Interest Calculations 1. Does the pool disclose the following about yield calculations: a. The methodology used to calculate interest? (Simple maturity, yield to maturity, etc.) b. The frequency of interest payments? c. How interest is paid? (Credited to principal at the end of the month, each quarter; mailed?) d. How are gains/losses reported? Factored monthly or only when realized? 29 REPORTING 1. Is the yield reported to participants of the pool monthly? (If not, how often?) 2. Are expenses of the pool deducted before quoting the yield? 3. Is the yield generally in line with the market yields for securities in which you usually invest? 4. How often does the pool report, and does that report include the market value of securities? SECURITY The following questions are designed to help you safeguard your funds from loss of principal and loss of market value. 1. Does the pool disclose safekeeping practices? 2. Is the pool subject to audit by an independent auditor? 3. Is a copy of the audit report available to participants? 4. Who makes the portfolio decisions? 5. How does the manager monitor the credit risk of the securities in the pool? 6. Is the pool monitored by someone on the board of a separate neutral party external to the investment function to ensure compliance with written policies? 7. Does the pool have specific policies with regards to the various investment vehicles? a. What are the different investment alternatives? b. What are the policies for each type of investment? 8. Does the pool mark the portfolio to its market value? 9. Does the pool disclose the following about how portfolio securities are valued: a. The frequency with which the portfolio3ecurities are valued? b. The method used to value the portfolio (cost, current value, or some other method)? 30 OPERA TIONS The answers to these questions will help you determine whether this pool meets your operational requirements: 1. Does the pool limit eligible participants? 2. What entities are permitted to invest in the pool? 3. Does the pool allow multiple accounts and sub -accounts? 4. Is there a minimum or maximum account size? 5. Does the pool limit the number of transactions each month? What is the number of transactions permitted each month? 6. Is there a limit on transaction amounts for withdrawals and deposits? a. What is the minimum and maximum withdrawal amount permitted? b. What is the minimum and maximum deposit amount permitted? 7. How much notice is required for withdrawals/deposits? 8. What is the cutoff time for deposits and withdrawals? 9. Can withdrawals be denied? 10. Are the funds 100% withdrawable at anytime? 11. What are the procedures for making deposits and withdrawals? a. What is the paperwork required, if any? b. What is the wiring process? 12. Can an account remain open with a zero balance? 13. Are confirmations sent following each transaction? STA TEMENTS It is important for you and the agency's trustee (when applicable), to receive statements monthly so the pool's records of your activity and holding are reconciled by you and your trustee. 31 1. Are statements for each account sent to participants? a. What are the fees? b. How often are they passed? c. How are they paid? d. Are there additional fees for wiring funds (what is the fee)? 2. Are expenses deducted before quoting the yield? QUESTIONS TO CONSIDER FOR BOND PROCEEDS ,x It is important to know (1) whether the pool accepts bond proceeds and (2) whether the pool qualifies with the U.S. Department of the Treasury as an acceptable commingled fund for arbitrage purposes. 1. Does the pool accept bond proceeds subject to arbitrage rebate? 2. Does the pool provide accounting and investment records suitable for proceeds of bond issuance subject to arbitrage rebate? 3. Will the yield calculation reported by the pool be acceptable to the IRS or will it have to be recalculated? 4. Will the pool accept transaction instructions from a trustee? 5. Are you allowed to have separate accounts for each bond issue so that you do not commingle the interest earnings of funds subject to rebate with funds not subject to regulations?' 32 Appendix H GLOSSARY (Adopted from the Municipal Treasurers Association) The purpose of this glossary is to provide the reader of the City of La Quinta investment policies with a better understanding of financial terms used in municipal investing. AGENCIES: Federal agency securities and/or Government -sponsored enterprises. ASKED: The price at which securities are offered. BANKERS' ACCEPTANCE (BA): A draft or bill of exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer. BID: The price offered by a buyer of securities. (When you are selling securities, you ask for a bid.) See Offer. BROKER: A broker brings buyers and sellers together for a commission. CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large -denomination CD's are typically negotiable. COLLATERAL: Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to seourities pledged by a bank to secure deposits of public monies. COMMERCIAL PAPER: Short-term unsecured promissory notes issued by a corporation to raise working capital. These negotiable instruments are purchased at a discount to par value or at par value with interest bearing. Commercial paper is issued by corporations such as General Motors Acceptance Corporation, IBM, Bank America, etc. COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR): The official annual report for the City of La Quinta. It includes five combined statements 33 for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance -related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section. CONDUIT FINANCING: A form of Financing in which a government or a government agency lends its name to a bond issue, although it is acting only as a conduit between a specific project and bond holders. The bond holders can look only to the revenues from the project being financed for repayment and not to the government or agency whose name appears on the bond. COUPON: (a) The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value. (b) A certificate attached to a bond evidencing interest due on a payment date. DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account. DEBENTURE: A bond secured only by the general credit of the issuer. DELIVERY VERSUS PAYMENT: There are two methods of delivery of securities: delivery versus payment and delivery versus receipt. Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities. DERIVATIVES: (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying index or security, and may include a leveraging factor, or (2) financial contracts based upon notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities or commodities). DISCOUNT: The difference between the cost price of a security and its maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount. DISCOUNT SECURITIES: Non -interest bearing money market instruments that are issued a discount and redeemed at maturity for full face value, e.g., U.S. Treasury Bills. DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns. are issued with maturities of less than one year and interest is paid at maturity. 3. FLBs (Federal Land Bank Bonds) - Long-term mortgage credit provided to farmers by Federal Land Banks. These bonds are issued at irregular times for various maturities ranging from a few months to ten years. The minimum denomination is $1,000. They carry semi-annual coupons. Interest is calculated on a 360-day, 30 day month basis. 4. FEDERAL CREDIT AGENCIES: Agencies of the Federal government set up to supply credit to various classes of institutions and individuals, 5. e.g., S&L's, small business firms, students, farmers, farm cooperatives, and exporters. 1. FNMAs (Federal National Mortgage Association) - Used to assist the home mortgage market by purchasing mortgages insured by the Federal Housing Administration and the Farmers Home Administration, as well as those guaranteed by the Veterans Administration. They are issued in various maturities and in minimum denominations of $10,000. Principal and Interest is paid monthly. 2. , FHLBs (Federal Home Loan Bank Notes and Bonds) - Issued by the Federal Home Loan Bank System to help finance the housing industry. The notes and bonds provide liquidity and home mortgage credit to savings and loan associations, mutual savings banks, cooperative banks, insurance companies, and mortgage -lending institutions. They are issued irregularly for various maturities. The minimum denomination is $5,000. The notes 34 FFCBs (Federal Farm Credit Bank) - Debt instruments used to finance the short and intermediate term needs of farmers and the national agricultural industry. They are issued monthly with three- and six-month maturities. The FFCB issues larger issues (one to ten year) on a periodic basis. These issues are highly liquid. FICBs (Federal Intermediate Credit bank Debentures) - Loans to lending institutions used to finance the short-term and intermediate needs of farmers, such as seasonal production. They are usually issued monthly in minimum denominations of $3,000 with a nine -month maturity. Interest is payable at maturity and is calculated on a 360-day, 30-day month basis. 6. FHLMCs (Federal Home Loan Mortgage Corporation) - a government sponsored entity established in 1970 to provide a secondary market for ^ conventional home mortgages. Morgages are purchased solely from the Federal home Loan Bank System member lending institutions whose deposits are insured by agencies of the United States Government. They are issued for various maturities and in minimum denominations of $10,000. Principal and Interest is paid monthly. Other federal agency issues are Small Business Administration notes (SBAs), Government National Mortgage Association notes (GNMAs), Tennessee Valley Authority notes (TVAs), and Student Loan Association notes (SALLIE-MAEs). FEDERAL DEPOSITOR INSURANCE CORPORATION (FDIC): A federal agency that insures bank deposits, currently up to $100,000 per deposit. FEDERAL FUNDS RATE: The rate of interest at which Fed funds are traded. This rate is currently pegged by the Federal Reserve through open -market operations. FEDERAL HOME LOAN BANKS (FHLB): Government sponsored wholesale banks (currently 12 regional banks) which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. The mission of the FHLBs is to liquefy the housing related assets of its members who must purchase stock in their district Bank. FEDERAL OPEN MARKET COMMITTEE (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money. FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven member Board of Governors in Washington, D.C., 12 regional banks and about 5,700 commercial banks that are members of the system. GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA or Ginnie Mae): Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations, 35 and other institutions. Security holder is protected by full faith and credit of the U.S. Government. Ginnie Mae securities are backed by the FHA, VA or FMHM mortgages. The term "passthrough" is often used to describe Ginnie Maes. LAIF (Local Agency Investment Fund) - A special fund in the State Treasury which local agencies may use to deposit funds for investment. There is no minimum investment period and the minimum transaction is $ 5,000, in multiples of $1,000 above that, with a maximum balance of $30,000,000 for any agency. The City is restricted to a maximum of ten transactions per month. It offers high liquidity because deposits can be converted to cash in 24 hours and no interest is lost. All interest is distributed to those agencies participating on. a proportionate share basis determined by the amounts deposited and the length of time they are deposited. Interest is paid quarterly. The State retains an amount for reasonable costs of making the investments, not to exceed one -quarter of one percent of the earnings. LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes. LOCAL GOVERNMENT INVESTMENT POOL (LGIP): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold. MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase --reverse repurchase agreements that establishes each party' s rights in the transactions. A master agreement will often specify, among other things, the right of the buyer -lender to liquidate the underlying securities in the vent of default by the seller -borrower. MATURITY: The date upon which the principal or stated value of an investment becomes due and payable MONEY MARKET: The market in which short- term debt instruments (bills, commercial paper, bander' acceptances, etc.) are issued and traded. OFFER: The price asked by a seller of securities. (When you are buying securities, you ask for an offer.) See Asked and Bid. OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve's most important and most flexible monetary policy tool. PORTFOLIO: Collection of all cash and securities under the direction of the City Treasurer, including Bond Proceeds. PRIMARY DEALER: A group of government securities dealers who submit daily reports of market activity and depositions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) -registered securities broker -dealers, banks and a few unregulated firms. QUALIFIED PUBLIC DEPOSITORIES: A financial institution which does not claim exemption from the payment of any sales or compensating use or ad valorem taxes under the laws of this state, which has segregated for the benefit of the 36 commission eligible collateral having a value of not less than its maximum liability and which has been approved by the Public Deposit Protection Commission to hold public deposits. RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond the current income return. REPURCHASE AGREEMENT (RP OR REPO): A repurchase agreement is a short-term investment transaction. Banks buy temporarily idle funds from a customer by selling U.S. Government or other securities with a contractual agreement to repurchase the same securities on a future date. Repurchase agreements are typically for one to ten days in maturity. The customer receives interest from the bank. The interest rate reflects both the prevailing demand for Federal funds and the maturity of the repo. Some banks will execute repurchase agreements for a minimum of $100,000 to $500,000, but most banks have a minimum of $1,000,000. REVERSE REPURCHASE AGREEMENTS (RRP or RevRepo) - A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security "buyer" in effect lends the "seller" money for the period of the agreement, and the terms of the agreement are structured to compensate him for this. Dealers use RRP extensively to finance their positions. Exception: When the Fed is said to be doing RRP, it is lending money that is increasing bank reserves. SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank's vaults for protection. SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution. SECURITIES & EXCHANGE COMMISSION: Agency created by Congress to protect investors in securities transactions by administering securities legislation. SEC RULE 15C3-1: See Uniform Net Capital Rule. STRUCTURED NOTES: Notes issued by Government Sponsored Enterprises (FHLB, FNMAS, SLMA, etc.) And Corporations which have imbedded options (e.g., call features, step- up coupons, floating rate coupons, derivative - based returns) into their debt structure. Their market performance is impacted by the fluctuation of interest rates, the volatility of the imbedded options and shifts in the Shape of the yield curve. SURPLUS FUNDS: Section 53601 of the California Government Code defines surplus funds as any money not required for immediate necessities of the local agency: The City has defined immediate necessities to be payment due within one week. TREASURY BILLS: A non -interest. bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months or one year. TREASURY BONDS: Long-term coupon -bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of more than 10 years. TREASURY NOTES: Medium -term coupon -bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities from two to 10 years. UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as nonmember broker -dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. 37 Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash. UNIFORM PRUDENT INVESTOR ACT: The State of California has adopted this Act. The Act contains the following sections: duty of care, diversification, review of assets, costs, compliance determinations, delegation of investments, terms of prudent investor rule, and application. YIELD: The rate of annual income return on an investment, expressed as a percentage. (a) INCOME YIELD is obtained by dividing the current dollar income by the current market price for the security. (b) NET YIELD or YIELD TO MATURITY is the current income yield minus any premium above par of plus any discount from par in purchase price, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond. PAGE EXECUTIVE SUMMARY Allow for the City to engage a professional investment portfolio. 10 Increasing GSE levels from $7.5 million per issurer to $10 million 11 Allow the investment of up to $3 million per issurer in Corporate Notes with ratings of "AA or AAA," for up to two years. INVESTMENT ADVISORY BOARD Meeting Date: TITLE: June 9, 2004 Month End Cash Report - May 2004 BACKGROUND: Correspondence & Written Material Item A This cash report is not a complete Treasury Report (exclude petty cash, deferred compensation and fiscal agent balances) but would report in a timely fashion selected cash balances. This report also includes other statistical investment data for the Board to review. RECOMMENDATION: Information item only. C 8 ami co wi M IV M OOpONN �N M Lao ti CD0000$P O �? N O8Gg�C�Oto0cocoNr-$ C O�ti�00000 F-C>MNOOOOCON N Mm�CD��p chm rj pN�m�cnN p O N O AL? EM LO LO M V CO 0 OD �oONN qwcM p 0 0 0 tO 0 OD (0 0) 0 0 coL e- M OOOOpr- f- e-NNI.p t'+/l O O O C C O O v c I� O» N N p "- 0 M — a mNIVtorl- r- act C C ti cn p O M v Q t0 N �O N N O O �0pp 0M 0 v U et LO L ti� m aO m m M MCi w LL N N N 80 M O N e O m U N N ^ N ~ M N !M n � N N N N O O M � N V! G N N OO N OO QO Op0 M M cM CO) CO) O yr coS`tp M p o N N M 0 co M LL V (3) O o M o co O C U� LO M m N e- i _O N 4 M N vil M y la 2 y cO N Y O C � V7 Q N N c in = N � O V ca N 4: C ca c o coo CO p rn a Vl •- m c �o m r. C N c y m t V la o .r E �, �'.' m c. y >.-= M= m v va 3 >,oao > o �' c� o a� cm co w Qa a w tea' ooza LLL'a y '0 E O 7 a \ VJ _ 13 o O E y N w T LO % C ti o CO C4 CON U M p C '0 7 y t� Q N C m y CO C y C "- y d N � V C N C N GQ La w N m p C t`N O S y .0 L O m d Ofo r N V E O ii = C �w c ~ y` do y V) t '0 a m No am m m Oco a� O. COco 2 L V C m �o y ..+ m m N M U y LL 0 M m t mm 0.9 c La t c L U N Lc o� a mm IV N C ma . y N m C N C. C as S -aiso° Ec �j p� N O c La y O V1 C N O g la to L 'C F- 01 C �.c aN Cf � >_ m o m CL C 'pOf V y y C N N >+ fiy, J cm V O C C d m o y Sa LL �0 �c U) ��w FRB: H.15--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Pagel of 4 Federal Reserve Statistical Release HA5 Selected Interest Rates (Daily) Skits to Content Release Date: May 28, 2004 Weekly_.._release_ dates_ and announcements. I Historical.._ data I About Daily update Other formats: Screen reader I ASCII The weekly release is posted on Monday. Daily updates of the weekly release are posted Tuesday through Friday H.15 DAILY UPDATE: WEB RELEASE ONLY For immediate release SELECTED INTEREST RATES May 28, 2004 Yields in percent per annum 2004 2004 2004 2004 May May May May Instruments 24 25 26 27 Federal funds (effective) 1 2 3 1.00 1.00 0.99 1.00 Commercial paper 3 4 5 Nonfinancial 1-month 1.01 1.00 1.00 1.00 2-month 1.09 1.07 3-month Financial 1-month 1.02 1.03 1.02 1.04 2-month 1.11 1.14 1.09 1.17 3-month 1.19 1.22 1.21 1.22 CDs (secondary market) 3 6 1-month 1.06 1.05 1.05 1.07 3-month 1.24 1.25 1.25 1.27 6-month 1.54 1.53 1.53 1.54 Eurodollar deposits (London) 3 7 1-month 1.03 1.03 1.03 1.03 3-month 1.22 1.22 1.23 1.24 6-month 1.52 1.51 1.52 1.51 Bank prime loan 2 3 8 4.00 4.00 4.00 4.00 Discount window primary credit 2 9 2.00 2.00 2.00 2.00 U.S. government securities Treasury bills (secondary market) 3 4 4-week 0.89 0.93 0.92 0.92 3-month 1.06 1.06 1.06 1.04 6-month 1.39 1.38 1.36 1.34 Treasury constant maturities Nominal 10 1-month 0.92 0.95 0.94 0.94 3-month 1.07 1.07 1.08 1.06 6-month 1.41 1.41 1.39 1.37 1-year 1.86 1.84 1.81 1.77 2-year 2.59 2.58 2.52 2.46 3-year 3.17 3.16 3.08 3.02 5-year 3.90 3.89 3.81 3.74 7-year 4.36 4.34 4.27 4.20 10-year 4.75 4.73 4.67 4.60 3 http://www.federalreserve.gov/Releases/H 15/update/ 6/l/2004 FRB: H.15--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 2 of 4 20-year Inflation -indexed 11 5-year 7-year 10-year Treasury long-term average Nominal 12 13 Inflation -indexed 14 Interest rate swaps 15 1-year 2-year 3-year 4-year 5-year 7-year 10-year 30-year Corporate bonds Moody's seasoned Aaa 16 Baa State & local bonds 17 Conventional mortgages 18 See overleaf for footnotes 5.48 5.45 5.41 5.34 1.27 1.29 1.23 1.19 1.71 1.72 1.66 1.62 2.01 2.03 1.99 1.97 5.50 5.47 5.43 5.38 2.37 2.38 2.36 2.32 2.13 2.11 2.09 2.06 3.01 2.98 2.94 2.87 3.62 3.58 3.54 3.46 4.07 4.03 3.99 3.90 4.41 4.37 4.33 4.23 4.86 4.82 4.78 4.69 5.27 5.23 5.19 5.12 5.84 5.82 5.78 5.73 6.06 6.03 6.00 5.93 6.77 6.75 6.72 6.65 5.01 FOOTNOTES 1. The daily effective federal funds rate is a weighted average of rates on brokered trades. 2. Weekly figures are averages of 7 calendar days ending on Wednesday of the current week; monthly figures include each calendar day in the month. 3. Annualized using a 360-day year or bank interest. 4. On a discount basis. 5. Interest rates interpolated from data on certain commercial paper trades settled by The Depository Trust Company. The trades represent sales of commercial paper by dealers or direct issuers to investors (that is, the offer side). The 1-, 2-, and 3-month rates are equivalent to the 30-, 60-, and 90-day dates reported on the Board's Commercial Paper Web page (www.federalreserve.gov/releases/cp). 6. An average of dealer offering rates on nationally traded certificates of deposit. 7. Bid rates for Eurodollar deposits collected around 9:30 a.m. Eastern time. 8. Rate posted by a majority of top 25 (by assets in domestic offices) insured U.S.-chartered commercial banks. Prime is one of several base rates used by banks to price short-term business loans. 9. The rate charged for discounts made and advances extended under the Federal Reserve's primary credit discount window program, which became effective January 9, 2003. This rate replaces that for adjustment credit, which was discontinued after January 8, 2003. For further information, see 4 http://www.federalreserve.gov/Releases/H 15/update/ 6/1 /2004 FRB: H.15--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 3 of 4 www.federalreserve.gov/boarddocs/press/bcreg/2002/200210312/default.htm. The rate reported is that for the Federal Reserve Bank of New York. Historical series for the rate on adjustment credit is available at www.federalreserve.gov/releases/hl5/data.htm. 10. Yields on actively traded non -inflation -index issues adjusted to constant maturities. Source: U.S. Treasury. 11. Yields on Treasury inflation protected securities (TIPS) adjusted to constant maturities. Source: U.S. Treasury. Additional information on both nominal and inflation -indexed yields may be found at www.treas.gov/offices/domestic-finance/debt-management/interest-rate/index.html. 12. Based on the unweighted average of the bid yields for all non -inflation -index Treasury fixed -coupon securities with remaining terms to maturity of 25 years and over. 13. A factor for adjusting the daily long-term average in order to estimate a 30-year rate can be found at www.treas.gov/offices/domestic-finance/debt-management/interest-rate/ltcompositeindex 14. Based on the unweighted average bid yields for all Inflation Protected Securities with remaining terms to maturity of more than 10 years. 15. International Swaps and Derivatives Association (ISDA) mid -market par swap rates. Rates are for a Fixed Rate Payer in return for receiving three month LIBOR, and are based on rates collected at 11:00 a.m. by Garban Intercapital plc and published on Reuters Page ISDAFIXI. Source: Reuters Limited. 16. Moody's Aaa rates through December 6, 2001 are averages of Aaa utility and Aaa industrial bond rates. As of December 7, 2001, these rates are averages of Aaa industrial bonds only. 17. Bond Buyer Index, general obligation, 20 years to maturity, mixed quality; Thursday quotations. 18. Contract interest rates on commitments for fixed-rate first mortgages. Source: FHLMC. DESCRIPTION OF THE TREASURY NOMINAL AND INFLATION -INDEXED CONSTANT MATURITY SERIES Yields on Treasury nominal securities at "constant maturity" are interpolated by the U.S. Treasury from the daily yield curve for non -inflation -indexed Treasury securities. This curve, which relates the yield on a security to its time to maturity, is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market. These market yields are calculated from composites of quotations obtained by the Federal Reserve Bank of New York. The constant maturity yield values are read from the yield curve at fixed maturities, currently 1, 3 and 6 months and 1, 2, 3, 5, 7, 10 and 20 years. This method provides a yield for a 10-year maturity, for example, even if no outstanding security has exactly 10 years remaining to maturity. Similarly, yields on inflation -indexed securities at "constant maturity" are interpolated from the daily yield curve for. Treasury inflation protected securities in the over-the-counter market. The inflation -indexed constant maturity yields are read from this yield curve at fixed maturities, currently 5, 7, and 10 years. Weeklv release dates and announcements I Historical data I About. Daily update Other formats: Screen. reader I ASCII Statistical releases hap://www.federalreserve.gQv/Releases/HI5/update/ 6/1/2004 FRB: H.15--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 4 of 4 Home I Economic research and data Accessibilitv_ I Contact L s Last update: May 28, 2004 6 http://www.federalreserve.gov/Releases/HI 5/update/ 6/1/2004 FRB: H. 1 5--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 1 of 4 Federal Reserve Statistical Release H*15 Selected Interest Rates (Daily) Skip to Content Release Date: May 28, 2004 Weekly._ release. dates.._ and._announcements 1 Historicaldata I About Daily update Other formats: Screen reader I ASCII The weekly release is posted on Monday. Daily updates of the weekly release are posted Tuesday through Friday H.15 DAILY UPDATE: WEB RELEASE ONLY For immediate release SELECTED INTEREST RATES May 28, 2004 Yields in percent per annum Instruments Federal funds (effective) 1 2 3 Commercial paper 3 4 5 Nonfinancial 1-month 2-month 3-month Financial 1-month 2-month 3-month CDs (secondary market) 3 6 1-month 3-month 6-month Eurodollar deposits (London) 3 7 1-month 3-month 6-month Bank prime loan 2 3 8 Discount window primary credit 2 9 U.S. government securities Treasury bills (secondary market) 3 4 4-week 3-month 6-month Treasury constant maturities Nominal 10 1-month 3-month 6-month 1-year 2-year 3-year 5-year 7-year 10-year 2004 2004 2004 2004 May May May May 24 25 26 27 1.00 1.00 0.99 1.00 1.01 1.00 1.00 1.00 1.09 1.07 1.02 1.03 1.02 1.04 1.11 1.14 1.09 1.17 1.19 1.22 1.21 1.22 1.06 1.05 1.05 1.07 1.24 1.25 1.25 1.27 1.54 1.53 1.53 1.54 1.03 1.03 1.03 1.03 1.22 1.22 1.23 1.24 1.52 1.51 1.52 1.51 4.00 4.00 4.00 4.00 2.00 2.00 2.00 2.00 0.89 0.93 0.92 0.92 1.06 1.06 1.06 1.04 1.39 1.38 1.36 1.34 0.92 0.95 0.94 0.94 1.07 1.07 1.08 1.06 1.41 1.41 1.39 1.37 1.86 1.84 1.81 1.77 2.59 2.58 2.52 2.46 3.17 3.16 3.08 3.02 3.90 3.89 3.81 3.74 4.36 4.34 4.27 4.20 4.75 4.73 4.67 4.60 h"://www.federalreserve.gov/Releases/H 15/update/ 6/1/2004 FRB: H. 15 --Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 2 of 4 20-year Inflation -indexed 11 5-year 7-year 10-year Treasury long-term average Nominal 12 13 Inflation -indexed 14 Interest rate swaps 15 1-year 2-year 3-year 4-year 5-year 7-year 10-year 30-year Corporate bonds Moody's seasoned Aaa 16 Baa State & local bonds 17 Conventional mortgages 18 See overleaf for footnotes 5.48 5.45 5.41 5.34 1.27 1.29 1.23 1.19 1.71 1.72 1.66 1.62 2.01 2.03 1.99 1.97 5.50 5.47 5.43 5.38 2.37 2.38 2.36 2.32 2.13 2.11 2.09 2.06 3.01 2.98 2.94 2.87 3.62 3.58 3.54 3.46 4.07 4.03 3.99 3.90 4.41 4.37 4.33 4.23 4.86 4.82 4.78 4.69 5.27 5.23 5.19 5.12 5.84 5.82 5.78 5.73 6.06 6.03 6.00 5.93 6.77 6.75 6.72 6.65 5.01 FOOTNOTES 1. The daily effective federal funds rate is a weighted average of rates on brokered trades. 2. Weekly figures are averages of 7 calendar days ending on Wednesday of the current week; monthly figures include each calendar day in the month. 3. Annualized using a 360-day year or bank interest. 4. On a discount basis. S. Interest rates interpolated from data on certain commercial paper trades settled by The Depository Trust Company. The trades represent sales of commercial paper by dealers or direct issuers to investors (that is, the offer side). The 1-, 2-, and 3-month rates are equivalent to the 30-, 60-, and 90-day dates reported on the Board's Commercial Paper Web page (www.federalreserve.gov/releases/cp). 6. An average of dealer offering rates on nationally traded certificates of deposit. 7. Bid rates for Eurodollar deposits collected around 9:30 a.m. Eastern time. 8. Rate posted by a majority of top 25 (by assets in domestic offices) insured U.S.-chartered commercial banks. Prime is one of several base rates used by banks to price short-term business loans. 9. The rate charged for discounts made and advances extended under the Federal Reserve's primary credit discount window program, which became effective January 9, 2003. This rate replaces that for adjustment credit, which was discontinued after January 8, 2003. For further information, see nttp://www.federalreserve.gov/Releases/Hl 5/update/ 6/1 /2004 FRB: H. I 5--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 3 of 4 www.federalreserve.gov/boarddocs/press/bcreg/2002/200210312/default.htm. The rate reported is that for the Federal Reserve Bank of New York. Historical series for the rate on adjustment credit is available at www.federalreserve.gov/releases/hl5/data.htm. 10. Yields on actively traded non -inflation -index issues adjusted to constant maturities. Source: U.S. Treasury. 11. Yields on Treasury inflation protected securities (TIPS) adjusted to constant maturities. Source: U.S. Treasury. Additional information on both nominal and inflation -indexed yields may be found at www.treas.gov/offices/domestic-finance/debt-management/interest-rate/index.html. 12. Based on the unweighted average of the bid yields for all non -inflation -index Treasury fixed -coupon securities with remaining terms to maturity of 25 years and over. 13. A factor for adjusting the daily long-term average in order to estimate a 30-year rate can be found at www.treas.gov/offices/domestic-finance/debt-management/interest-rate/itcompositeindeN 14. Based on the unweighted average bid yields for all Inflation Protected Securities with remaining terms to maturity of more than 10 years. 15. International Swaps and Derivatives Association (ISDA) mid -market par swap rates. Rates are for a Fixed Rate Payer in return for receiving three month LIBOR, and are based on rates collected at 11:00 a.m. by Garban Intercapital plc and published on Reuters Page ISDAFIXI. Source: Reuters Limited. 16. Moody's Aaa rates through December 6, 2001 are averages of Aaa utility and Aaa industrial bond rates. As of December 7, 2001, these rates are averages of Aaa industrial bonds only. 17. Bond Buyer Index, general obligation, 20 years to maturity, mixed quality; Thursday quotations. 18. Contract interest rates on commitments for fixed-rate first mortgages. Source: FHLMC. DESCRIPTION OF THE TREASURY NOMINAL AND INFLATION -INDEXED CONSTANT MATURITY SERIES Yields on Treasury nominal securities at "constant maturity" are interpolated by the U.S. Treasury from the daily yield curve for non -inflation -indexed Treasury securities. This curve, which relates the yield on a security to its time to maturity, is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market. These market yields are calculated from composites of quotations obtained by the Federal Reserve Bank of New York. The constant maturity yield values are read from the yield curve at fixed maturities, currently 1, 3 and 6 months and 1, 2, 3, 5, 7, 10 and 20 years. This method provides a yield for a 10-year maturity, for example, even if no outstanding security has exactly 10 years remaining to maturity. Similarly, yields on inflation -indexed securities at "constant maturity" are interpolated from the daily yield curve for Treasury inflation protected securities in the over-the-counter market. The inflation -indexed constant maturity yields are read from this yield curve at fixed maturities, currently 5, 7, and 10 years. Weekly release dates and announcements I Historical data I About Daily update Other formats: Screen.reader I ASCII. Statistical releases http://www.federalreserve.gov/Releases/H 15/update/ 6/l /2004 FRB: H.15--Selected Interested Rates, Web -Only Daily Update --May 28, 2004 Page 4 of 4 Home f Econotnic research and data Accessibift I Contact Us Last update: May 28, 2004 ..� 10. http://www.federalreserve.gov/Releases/HI 5/update/ 6/1/2004 FRB:Commercial Paper Rates and Outstandings Page 1 of 3 Federal Reserve Release Commercial Paper Release I About I Outstandings I Historical discount rates I Historical outstandings Data as of May 27, 2004 Commercial Paper Rates and Outstandings Derived from data supplied by The Depository Trust Company Trade data insufficient to support calculation of the 60-day AA nonfinancial and 90-day AA nonfinancial rate(s) for May 27, 2004. Posted May 28, 2004 Discount rates AA AA A2/P2 Term financial nonfinancial nonfinancial 1-day 0.98 11 1.00 1 1.05 7-day 1.01 1.04 1.10 15-day 1.03 1.01 1.11 30-day 1.04 1.00 1.15 11 60-day 1.17 ND 1.24 -]1 190-day 11 1.22 ND 135 Yield curve Morley market basis Financial _ _ _ Nonfinancial .-.__r_. A2/P2 Percent 1 7 15 30 60 90 Days to Maturity http://www.federalreserve.gov/Releases/CP/ 6/l/2004 FRB:Commercial Paper Rates and Outstandings Page 2 of 3 Discount rate spread 2001 2002 2003 Discount rate history Thirty -day commercial gaper (daily) financial -- — — Nonfinancial ........... on 2002 Outstandings Weekly (Wednesday), seasonally adjusted 2003 Basis paints l20 100 80 60 40 20 0 2004 Percent — 15 4 3 2 0 http://www.federalreserve.gov/Releases/CP/ 12 6/1/2004 FRB:Commercial Paper Rates and Outstandings Page 3 of 3 Billions of dollars 1260 1.240 1220 1200 1.180 11,60 1140 2001 23 Billions of dollars zVV Y 10 LIJ X The daily commercial paper release will usually be available before 11:OOam EST. However, the Federal Reserve makes no guarantee regarding the timing of the daily commercial paper release. When the Federal Reserve is closed on a business day, yields for the previous business day will appear in the historical discount rates table. This policy is subject to change at any time without notice. Commercial paper outstanding Commercial paper outstanding,, miscellaneous categories Volume Statistics 2004 :Ql Release I About Outstandin s, I Historical discount rates Historical outstandings Home ( Statistical releases AccessibilityI Contact Us Last update: May 28, 2004 �13 http://www.federalreserve.gov/Releases/CP/ 6/ 1 /2004 Phil Angelides, State Treasurer Inside the State Treasurer's Office Local Agency Investment Fund (LAIF) PMIA Performance Report LAIF Performance Report Quarter Ending 03/31/04 Apportionment Rate: 1.47% Earnings Ratio: .00004028428658015 Fair Value Factor: 1.000754626 PMIA Average Monthly Effective Yields February 2004 1.440% March 2004 1.474% April 2004 1.445% Pooled Money Investment Account Portfolio Composition $60.7 Billion 04/30/04 Loans Treasuries Corporate 8.66% 13.54% Commercial Paper 18.30% Tir Depi 9.2. CD's/BN's 21.28% Igages 1.01 % Agencies 26.08% ■ Treasuries O Mortgages ®Agencies ■ CD's/BN's OTime Deposits ® Bankers Acceptances ■ Repo ■ Commercial Paper Corporate Bonds 0 Loans ■ Reverses 4 c O U a J 0 L 6- .0 to c � 0) 'Op E m a a `) m > � c > m N J m N LQL O Zi c f4 Q W tiff ONN �mco � wo C ON Ot01- d0 pippp OOco �r �)Iz(3i f-M co co MM 0 eN N v L 0)N N Q ~� M F)to- rn-9 000��p V- CO It 0) In N NO CV) M0 N M l to1- tV CA v Q m� aQ �L M N V)_st CO mm (pp m ��> s C� p N In t�l� L U` C4 W C#) d~ Ln U Q N M Net r CA v U toC) OMO OMMg LO M p CO � I COM N lo:q f. 11Mo"10 pp-* - o N N tD M t0 M LO Cf) m e- N et t0 t 3 0 6 N'm-' E x c c m 12 F C C m c c m CL 4)v� 1 c W Qc'; LL CL Q ~`>>> aLm m S 0X Zx c > N N oc m m o m Q a co02 m xx>'em�iS 1 wcnw0 Z r CD coo $ .O c � O c a N Cf fl. V O .� 6 J LL C U rn E E cm o Y co N 0 > c 0Ln C m U. 0) .- c O c) N -w c a C C N :E 29 J 4 U E C c m m. H N pC O O O W m C J N g0 0 8 °� 3 E .� L- _ co > M N 00 O .• N O N N 0LL O a m axi n a a>i O o E QO y c V (D :a Q EL •a -0 N U ma u) zo m oo(0Ln00Ln'00� O 0) i ti M CNMLO CIAO tCONP00V-1�V- r� NN t0 ci E LaZ e~-�NOC~7000Nti��`�' N co r ,D > v r r C O v O E V �4 OGo z 3 m c W } Z F- } m ~ Cl) c w w � Wviw0a¢= �� aYa:0 J w Q O Z= Z W Z N W a V V _ W c QW V�ZD J��d�-Z�Z O x._ wWO_»ODa a:0 Z W 0 DO5owmO_Ua_WZ<WM INVESTMENT ADVISORY BOARD Meeting Date: TITLE: June 9, 2004 Pooled Money Investment Board Report for March 2004 BACKGROUND: Correspondence & Written Material Item B The Pooled Money Investment Board Report for March, 2004 RECOMMENDATION: Receive & File John M. Falcdner, Finance Director Philip Angelides March 2004 STATE OF CALIFORNIA STATE TREASURER'S OFFICE POOLED MONEY INVESTMENT BOARD REPORT March 2004. TABLE OF CONTENTS SUMMARY................................................................. 01 SELECTED INVESTMENT DATA .................................... 02 PORTFOLIO COMPOSITION ........................................ 03 INVESTMENT TRANSACTIONS ..................................... 04 TIME DEPOSITS........................................................ 17 BANK DEMAND DEPOSITS .......................................... 28 POOLED MONEY INVESTMENT BOARD DESIGNATION... 29 POOLED MONEY INVESTMENT ACCOUNT SUMMARY OF INVESTMENT DATA A COMPARISON OF MARCH 2O04 WITH MARCH 2O03 (DOLLARS IN THOUSANDS) MARCH 2004 MARCH 2O03 CHANGE Average Daily Portfolio $ 62,164,802 $ 63,823,686 $-1,658,783 Accrued Earnings $ 66,109 $ 87,028-21,919 Effective Yield 1.474 1.904 -0.43 Average Life -Month End (In Days) 159 161 -2 Total Security Transactions Amount $ 19,768,937 $ 18,233,046 $ +1,525,891 Number 426 397 +29 Total Time Deposit Transactions Amount $ 2,090,700 $ 2,156,000 $ -64,300 Number 138 142 -4 Average Workday Investment Activity $ 993,166 $ 1,019,402 $ -26,237 Prescribed Demand Account Balances For Services $ 1,337,090 $ 1,008,445 $ +328,645 For Uncollected Funds $ 136,419 $ 97,385 +39,034 1 PHILIP ANGELIDES TREASURER STATE OF CALIFORNIA INVESTMENT DIVISION SELECTED INVESTMENT DATA ANALYSIS OF THE POOLED MONEY INVESTMENT ACCOUNT PORTFOLIO (000 OMITTED) TYPE OF SECURITY Government Bills Bonds Notes Strips Total Government Federal Agency Coupons Certificates of Deposit Bank Notes Bankers' Acceptances Repurchases Federal Agency Discount Notes Time Deposits GNMAs Commercial Paper FHLMC Corporate Bonds Pooled Loans GF Loans Reversed Repurchases Total (All Types) INVESTMENT ACTIVITY Pooled Money Other Time Deposits Totals PMIA Monthly Average Effective Yield Year to Date Yield Last Day of Month March 31, 2004 DIFFERENCE IN PERCENT OF PERCENT OF PORTFOLIO FROM AMOUNT PORTFOLIO PRIOR MONTH $ 1,094,783 2.11 -0.11 0 0.00 0.00 6,147,707 11.84 -0.77 0 0.00 0.00 $ 7,242,490 13.95 -0.88 $ 3,915,362 7.54 +0.29 7,935,044 15.29 +1.79 808,635 1.56 -0.13 0 0.00 0.00 0 0.00 -0.18 9,165,817 17.66 +0.33 5,881,295 11.33 +0.49 492 0.00 0.00 8,016,691 15.45 -3.64 3,567 0.01 0.00 1,791,202 3.46 +0.09 6,208,431 11.96 +0.90 928,600 1.79 +0.84 0 0.00 0.00 $ 51,897,626 100.00 MARCH 2O04 NUMBER AMOUNT 426 $ 19,768,937 14 285,852 138 2,090,700 578 $ 22,135,489 1.474 1.564 F FEBRUARY 2004 NUMBER AMOUNT 431 $ 19,802,686 41 848,339 125 2,315,600 597 $ 22,966,625 1.440 1.575 Corpc Bon 3.4E Commercial Paper 15.45% Pooled Money Investment Account Portfolio Composition $51.8 Billion 03/31 /04 Loans Treasuries 13.75% 412 o=oi VG1.JVQ1 W 11.33% CD's/BN's 16.85% 3 tgages 01% Agencies 25.20% 0 Treasuries 13 Mortgages Agencies E CD's/BN's O Time Deposits E9 Bankers Acceptances ■ Repo Commercial Paper ■ Corporate Bonds l Loans ■ Reverses 03101 /04 SALES c/ DISC NOTES FHLB 03/26/04 1.050 25,000 3 2,140.60 1.064 DISC NOTES FNMA 04/21/04 1.050 25,000 3 2,137.89 1.064 DISC NOTES FNMA 05/26/04 1.050- 25,000 3 2,137.89 1.064 DISC NOTES FHLB 05/28/04 1.050 27,323 3 2,333.63 1.064 03/01/04 REDEMPTIONS BN WORLD 1.040% 03/01/04 1.060 50,000 76 111,884.18 1.078 BN WORLD 1.040% 03/01/04 1.060 50,000 76 111,884.18 1.078 BN WORLD 1.040% 03/01/04 1.060 50,000 76 111,884.18 1.078 BN WORLD 1.040% 03/01/04 1.060 50,000 76 111,884.18 1.078 CD NOVA SCOT 1.070% 03/01/04 1.070 50,000 147 218,458.33 1.088 CD NOVA SCOT 1.070% 03/01/04 1.070 50,000 147 218,458.33 1.088 CP CITI GLOBAL 03/01/04 1.000 50,000 6 8,333.33 1.016 CP CITI GLOBAL 03/01/04 1.000 50,000 6 8,333.33 1.016 CP CITI GLOBAL 03/01/04 1.000 50,000 6 8,333.33 1.016 CP GE CO 03/01/04 1.000 50,000 6 8,333.33 1.016 CP GE CO 03/01/04 1.000 50,000 6 8,333.33 1.016 CP GE CO 03/01/04 1.000 50,000 6 8,333.33 1.016 CP GE CO 03/01/04 1.000 50,000 6 8,333.33 1.016 CP DEERE 03/01/04 1.060 25,000 27 19,875.00 1.079 CP CITICORP 03/01/04 1.065 50,000 69 102,062.50 1.085 CP CITICORP 03/01/04 1.065 50,000 69 102,062.50 1.085 CP CITICORP 03/01/04 1.070 50,000 70 104,027.78 1.090 CP CITICORP 03/01/04 1.070 50,000 70 104,027.78 1.090 CP CITICORP 03/01/04 1.070 50,000 70 104,027.78 1.090 CP CITICORP 03/01/04 1.070 50,000 70 104,027.78 1.090 CP GMAC 03/01/04 1.360 30,000 124 140,533.33 1.389 CP CITI GLOBAL 03/01/04. 1.080 50,000 124 186,000.00 1.102 CP CITI GLOBAL 03/01/04 1.080 50,000 124 -186,000.00 1.102 CP CITI GLOBAL 03/01/04 1.080 50,000 124 186,000.00 1.102 CP GMAC 03/01/04 1.360 50,000 124 234,222.22 1.389 CP GMAC 03/01/04 1.360 50,000 124 234,222.22 1.389 CP GECC 03/01/04 1.100 50,000 125 190,972.22 1.123 CP GECC 03/01/04 1.100 50,000 125 190,972.22 1.123 CP GMAC 03/01/04 1.340 50,000 139 258,694.44 1.369 CP GMAC 03/01/04 1.340 50,000 139 258,694.44 1.369 CP GECC 03/01/04 1.070 50,000 151 224,402.78 1.093 CP GECC 03/01/04 1.070 50,000 151 224,402.78 1.093 03/01/04 PURCHASES BN WORLD 1.000% 04/26/04 1.020 50,000 BN WORLD 1.000% 04/26/04 1.020 50,000 CP AMER EXP 03/26/04 1.010 50,000 CP AMER EXP 03/26/04 1.010 50,000 CP AMER EXP 04/01/04 1.010 50,000 CP AMER EXP 04/01/04 1.010 50,000 CP FCAR 04/01/04 1.020 50,000 4 03/01/04 PURCHASES (continued) CP FCAR 04/01/04 1.020 50,000 CP DEERE 04/06/04 1.040 25,000 CP JP MORGAN 05/03/04 1.020 50,000 CP JP MORGAN 05/03/04 1.020 50,000 CP JP MORGAN 05/05/04 1.020 50,000 CP JP MORGAN 05/05/04 1.020 50,000 CP JP MORGAN 05/05/04 1.020 50,000 CP JP MORGAN 05/05/04 1.020 50,000 CP GECC 05/26/04 .1.030 50,000 CP GECC 05/26/04 1.030 50,000 CP CITICORP 05/26/04 1.050 50,000 CP CITICORP 05/26/04 1.050 50,000 CP CITICORP 05/26/04 1.050 50,000 CP CITICORP 05/26/04 1.050 50,000 CP GECC 05/28/04 1.030 50,000 CP GECC 05/28/04 1.030 50,000 03/02/04 REDEMPTIONS CD CIBC 1.010% 03/02/04 1.010 50,000 7 9,819.45 1.027 CD CIBC 1.010% 03/02/04 1.010 50,000 7 9,819.45 1.027 CD CIBC 1.010% 03/02/04 1.010 50,000 7 9,819.45 1.027 CD CIBC 1.010% 03/02/04 1.010 50,000 7 9,819.45 1.027 CP GECC 03/02/04 1.000 50,000 5 6,944.44 1.017 CP GECC 03/02/04 1.000 50,000 5 6,944.44 1.017 CP GECC 03/02/04 1.000 50,000 5 6,944.44 1.017 CP GECC 03/02/04 1.000 50,000 5 6,944.44 1.017 CP W/F 03/02/04 0.999 20,000 6 3,300.00 1.007 CP W/F 03/02/04 0.990 50,000 6 8,250.00 1.007 CP W/F 03/02/04 0.999 50,000 6 8,250.00 1.007 CP W/F 03/02/04 0.999 50,000 6 8,250.00 1.007 CP GE CO 03/02/04 1.000 50,000 6 8,333.33 1.017 CP GE CO 03/02/04 1.000 30,000 6 5,000.00 1.017 CP CITI GLOBAL 03/02/04 1.010 50,000 8 11,222.22 1.027 CP CITI GLOBAL 03/02/04 1.010 50,000 8 11,222.22 1.027 CP CITI GLOBAL 03/02/04 1.010 50,000 8 11,222.22 1.027 CP CITI GLOBAL 03/02/04 1.010 50,000 8 11,222.22 1.027 CP GE CO 03/02/04 1.010 50,000 14 19,638.89 1.027 CP GE CO 03/02/04 1.010 50,000 14 19,638.89 1.027 CP CITI GLOBAL 03/02/04 1.020 50,000 14 19,833.33 1.037 CP CITI GLOBAL 03/02/04 1.020 50,000 14 19,833.33 1.037 DISC NOTES FHLB 03/02/04 0.940 50,000 6 7,833.33 0.956 03/02/04 NO PURCHASES 03/03/04 REDEMPTIONS CP GECC 03/03/04 1.000 50,000 7 9,722.22 1.017 CP GECC 03/03/04 1.000 50,000 7 9,722.22 1.017 CP CITI GLOBAL 03/03/04 1.020 50,000 21 29,750.00 1.038 5 03/03/04 REDEMPTIONS (continued) CID CITI GLOBAL 03/03/04 NO PURCHASES 03/04/04 REDEMPTIONS CID AMER EXP CID AMER EXP CID AMER EXP CID AMER EXP CID AMER EXP CID AMER EXP 03/04/04 PURCHASES CD TORONTO CD TORONTO CD TORONTO CD TORONTO CID DISNEY CID B/A CID B/A CID SAFEWAY CID GECC CID GECC CID CITI GLOBAL CID CITI GLOBAL CID CITI GLOBAL CID CITI GLOBAL 03/06/04 REDEMPTIONS CID CITI GLOBAL 03/06/04 NO PURCHASES 03/08/04 REDEMPTIONS CD CIBC CID COUNTRY CID COUNTRY CID CITICORP CID CITICORP CID GECC CID GECC 03/08/04 NO PURCHASES 03/03/04 1.020 250,000 21 14,875.00 1.038 03/04/04 1.010 50,000 6 8,416.67 1.027 03/04/04 1.010 50,000 6 8,416.67 1.027 03/04/04 1.010 50,000 6 8,416.67 1.027 03/04/04 1.010 50,000 6 8,416.67 1.027 03/04/04 1.000 50,000 7 9,722.22 1.017 03/04/04 1.000 50,000 7 9,722.22 1.017 1.045% 06/16/04 1.040 50,000 1.045% 06/16/04 1.040 50,000 1.045% 06/16/04 1.040 50,000 1.045% 06/16/04 1.040 50,000 04/01/04 1.050 25,000 05/03/04 1.030 7,197 05/03/04 1.030 50,000 05/03/04 1.070 50,000 06/16/04 1.040 20,000 06/16/04 1.040 50,000 06/16/04 1.040 50,000 06/16/04 1.040 50,000 06/16/04 1.040 50,000 06/16/04 1.040 50,000 03/05/04 1.020 50,000 23 32,583.33 1.038 1.010% 03/08/04 1.010 50,000 11 15,430.56 1.027 03/08/04 1.040 35,000 14 14,155.56 1.058 03/08/04 1.040 50,000 14 20,222.22 1.058 03/08/04 1.065 50,000 76 112,416.67 1.085 03/08/04 1.065 50,000 76 112,416.67 1.085 03/08/04 1.110 50,000 122 188,083.33 1.133 03/08/04 1.110 50,000 122 188,083.33 1.133 n 03/09/04 REDEMPTIONS CD FORTIS 1.070% 03/09/04 1.070 50,000 154 228,861.11 1.088 CD FORTIS 1.070% 03/09/04 1.070 50,000 154 228,861.11 1.088 CD WASHINGTON 1.120% 03/09/04 1.120 50,000 155 241,111.11 1.139 CD WASHINGTON 1.120% 03/09/04 1.120 50,000 155 241,111.11 1.139 CP CITI GLOBAL 03/09/04 1.020 50,000 29 41,083.33 1.038 CP CITI GLOBAL 03/09/04 1.020 50,000 29 41,083.33 1.038 CP CITI GLOBAL 03/09/04 1.020 50,000 29 41,083.33 1.038 CP CITI GLOBAL 03/09/04 1.020 50,000 29 41,083.33 1.038 CP GECC 03/09/04 1.070 50,000 78 115,916.67 1.090 CP GECC 03/09/04 1.070 50,000 78 115,916.67 1.090 CP FCAR 03/09/04 1.080 50,000 81 121,500.00 1.101 CID FCAR 03/09/04 1.080 50,000 81 121,500.00 1.101 CID FCAR 03/09/04 1.080 50,000 81 121,500.00 1.101 CP SRAC 03/09/04 1.150 50,000 84 134,166.67 1.172 CP GECC 03/09/04 1.100 50,000 117 178,750.00 1.122 CP GECC 03/09/04 1.100 50,000 117 178,750.00 1.122 CP GECC 03/09/04 1.100 10,000 125 38,194.44 1.123 CP GECC 03/09/04 1.100 50,000 125 190,972.22 1.123. CP GECC 03/09/04 1.100 50,000 125 190,972.22 1.123 CP JP MORGAN 03/09/04 1.080 50,000 132 198,000.00 1.102 CP JP MORGAN 03/09/04 1.080 50,000 132 198,000.00 1.102 CP GMAC 03/09/04 1.340 50,000 155 288,472.22 1.370 03/09/04 PURCHASES CID GMAC 04/28/04 1.250 50,000 CP GMAC 04/28/04 1.250 50,000 CP SRAC 06/16/04 1.060 50,000 CD S-E BANK 1.040% 06/16/04 1.040 50,000 CD S-E BANK 1.040% 06/16/04 1.040 50,000 CD CS/FST BOSTON 1.040% 06/16/04 1.040 50,000 03/10/04 REDEMPTIONS CD W/F 1.020% 03/10/04 1.020 50,000 30 42,500.00 1.037 CD W/F 1.020% 03/10/04 1.020 50,000 30 42,500.00 1.037 CD MONTREAL 1.010% 03/10/04 1.010 50,000 30 42,083.33 1.027 CD MONTREAL 1.010% 03/10/04 1.010 50,000 30 42,083.33 1.027 CP AMER EXP 03/10/04 1.010 50,000 30 42,083.33 1.028 CP AMER EXP 03/10/04 1.010 25,000 30 21,041.67 1.028 CP GECC 03/10/04 1.070 50,000 79 117,402.78 1.090 CP GECC 03/10/04 1.070 50,000 79 117,402.78 1.090 CP GECC 03/10/04 1.100 50,000 118 180,277.78 1.122 CP GECC 03/10/04 1.100 50,000 118 180,277.78 1.122 CP JP MORGAN 03/10/04 1.080 50,000 133 190,500.00 1.102 CP JP MORGAN 03/10/04 1.080 50,000 133 199,500.00 1.102 03/10/04 PURCHASES CD CS/FST BOSTON 1.040% 06/16/04 1.040 25,000 7 03/10/04 PURCHASES (continued) CD CS/FST BOSTON 1.040% 06/16/04 1.040 CD CS/FST BOSTON 1.040% 06/16/04 1.040 CD US BANK 1.020% 06/16/04 1.020 CD US BANK 1.020% 06/16/04 1.020 CD US BANK 1.020% 06/16/04 1.020 CD US BANK 1.020% 06/16/04 1.020 CD DEXIA 1.025% 06/16/04 1.020 CD DEXIA 1.025% 06/16/04 1.020 CD WASHINGTON 1.070% 06/16/04 1.070 CD WASHINGTON 1.070% 06/16/04 1.070 CID AMER EXP 04/09/04 1.010 CID AMER EXP 04/09/04 1.010 CID BARTON 04/12/04 1.020 CID GMAC 04/28/04 1.250 CID GMAC 04/28/04 1.250 CP GMAC 05/05/04 1.250 CID GMAC 05/05/04 1.250 03/11/04 REDEMPTIONS CD MONTREAL 1.010% 03/11/04 1.010 CD MONTREAL 1.010% 03/11/04 1.010 CID COUNTRY 03/11/04 1.050 03/11/04 PURCHASES CID GECC 04/09/04 1.020 CID GECC 04/09/04 1.020 CID FCAR 05/10/04 1.020 CID SAFEWAY 06/09/04 1.070 03/12/04 REDEMPTIONS CID COUNTRY 03/12/04 1.050 03/12/04 NO PURCHASES 03/16/04 REDEMPTIONS CITICORP 03/16/04 PURCHASES CD DEXIA CD DEXIA CID BEAR CID BEAR CID BEAR CID BEAR CID SARA LEE 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 25,000 50,000 50,000 50,000 50,000 50,000 14 19, 638.89 1.027 50,000 14 19, 638.89 1.027 50,000 16 23,333.33 1.068 50,000 50,000 50,000 50,000 25,000 30 21,875.00 1.068 7.125% 03/15/04 5.300 6,750 1068 1,077,380.93 1.025% 06/16/04 1.025 50,000 1.025% 06/16/04 1.025 50,000 03/26/04 1.000 50,000 03/26/04 1.000 50,000 03/26/04 1.000 50,000 03/26/04 1.000 50,000 03/26/04 1.050 50,000 8 5.215 03/16/04 PURCHASES (continued) CP CITI GLOBAL 03/20104 1,010 60,000 CP CITI GLOBAL 03/26/04 1.010 50,000 CP CITI GLOBAL 03/26/04 1.010 50,000 CID GMAC 04/28/04 1.240 50,000 CP GMAC 04/28/04 1.240 50,000 03/16/04 REDEMPTIONS CP JP MORGAN 03/16/04 1.090 5,000 124 18,772.22 1.112 CP JP MORGAN 03/16/04 1.090 50,000 124 187,722.22 1.112 CP JP MORGAN 03/16/04 1.090 50,000 124 187,722.22 1.112 CP JP MORGAN 03/16/04 1.090 50,000 124 187,722.22 1.112 03/16/04 PURCHASES CD US BANK 1.010% 03/26/04 1.010 50,000 CD US BANK 1.010% 03/26/04 1.010 50,000 CD CS/FST BOSTON 1.035% 06/16/04 1.030 50,000 CD CS/FST BOSTON 1.035% 06/16/04 1.030 50,000 CP COUNTRY 03/26/04 1.050 2,460 CP COUNTRY 03/26/04 1.050 50,000 CP GMAC 04/28/04 1.240 50,000 CP GMAC 04/28/04 1.240 50,000 03/17/04 REDEMPTIONS DISC NOTES FNMA 03/17/04 1.085 50,000 142 213,986.11 1.108 DISC NOTES FNMA 03/17/04 1.085 4,072 142 17,427.03 1.108 03/17/04 NO PURCHASES 03/18/04 NO REDEMPTIONS 03/18/04 PURCHASES CP FCAR 06/16/04 1.030 50,000 03/19/04 NO REDEMPTIONS 03/19/04 NO PURCHASES 03/20/04 REDEMPTIONS MTN FMCC 6.125% 03/20/04 5.831 17,000 1031 2,812,003.96 5.829 03/22/04 REDEMPTIONS CP CITI GLOBAL 03/22/04 1.010 50,000 25 35,069.44 1.028 CP CITI GLOBAL 03/22/04 1.010 50,000 25 35,069.44 1.028 CP CITI GLOBAL 03/22/04 1.010 50,000 25 35,069.44 1.028 9 03/22/04 REDEMPTIONS (continued) CP CITI GLOBAL CP COUNTRY CP PREFCO CP PREFCO 03/22/04 PURCHASES CP COUNTRY CP MORG STAN 03/23/04 REDEMPTIONS CP SARA LEE 03/23/04 PURCHASES CD WASHINGTON CD WASHINGTON CP CITI GLOBAL CP CITI GLOBAL 03/24/04 REDEMPTIONS DISC NOTES FNMA DISC NOTES FNMA DISC NOTES FNMA DISC NOTES FNMA 03/24/04 PURCHASES c/ FHLB DISC NOTES FHLB DISC NOTES FHLB DISC NOTES FHLB DISC NOTES FNMA 03/24/04 PURCHASES CP CITI GLOBAL CP CITI GLOBAL CP CITI GLOBAL CP CITI GLOBAL CP CITI GLOBAL CP CITI GLOBAL CP CITI GLOBAL CP CITI GLOBAL CP B/A CP B/A DISC NOTES FNMA DISC NOTES FNMA 03/22/04 1.010 50,000 25 35,069.44 1.028 03/22/04 1.040 20,760 28 16,792.53 1.058 03/22/04 1.030 31,000 28 24,834.44 1.048 03/22/04 1.030 50,000 28 40,055.56 1.048 03/30/04 1.050 27,810 03/30/04 1.010 25,000 03/23/04 1.060 30,000 29 25,616.67 1.060% 06/30/04 1.070 50,000 1.060% 06/30/04 1.070 50,000 06/16/04 1.030 50,000 06/16/04 1.030 50,000 1.079 03/24/04 1.085 15,000 149 67,360.42 1.108 03/24/04 1.085 50,000 149 224,534.72 1.108 03/24/04 1.085 50,000 149 224,534.72 1.108 03/24/04 1.085 50,000 149 224,534.72 1.108 2.875% 02/15/07 1.000 48,840 04/21/04 1.000 50,000 05/26/04 1.000 4,575 05/26/04 1.000 50,000 07/14/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 03/30/04 1.000 50,000 06/16/04 1.030 50,000 06/16/04 1.030 50,000 06/16/04 0.995 50,000 06/16/04 0.995 50,000 10 03/24/04 PURCHASES (continued) DISC NOTES FNMA DISC NOTES FNMA 03/25/04 REDEMPTIONS c/ 06/16/04 0.995 50,000 06/16/04 0.995 50,000 DISC NOTES FHLB 05/26/04 1.000 4,575 1 124.19 1.014 DISC NOTES FHLB 04/21/04 1.000 50,000 1 1,359.11 1.014 DISC NOTES FHLB 05/26/04 1.000 50,000 1 1,357.42 1.014 DISC NOTES FNMA 07/14/04 1.000 50,000 1 1,355.72 1.014 FHLB 2.875% 02/15/07 1.000 48,840 1 1,359.11 1.014 03/26/04 REDEMPTIONS TREAS BILLS 03/25/04 0.990 50,000 177 243,375.00 TREAS BILLS 03/25/04 0.990 50,000 177 243,375.00 03/25/04 PURCHASES BN WORLD 0.990% 05/28/04 1.010 50,000 BN WORLD 0.990% 05/28/04 1.010 50,000 BN WORLD 0.990% 05/28/04 1.010 50,000 BN WORLD 0.990% 05/28/04 1.010 50,000 CD UBS 1.020% 06/16/04 1.020 50,000 CD UBS 1.020% 06/16/04 1.020 50,000 CD DEXIA 1.030% 06/16/04 1.025 50,000 CD DEXIA 1.030% 06/16/04 1.025 50,000 CD CS/FST BOSTON 1.035% 06/16/04 1.035 50,000 CD CS/FST BOSTON 1.035% 06/16/04 1.035 50,000 CD FORTIS 1.030% 06/16/04 1.030 50,000 CD FORTIS 1.030% 06/16/04 1.030 50,000 CD US BANK 1.030% 06/25/04 1.030 10,000 CD W/F 1.010% 06/25/04 1.010 50,000 CD W/F 1.010% 06/25/04 1.010 50,000 CD W/F 1.010% 06/25/04 1.010 50,000 CD W/F 1.010% 06/25/04 1.010 50,000 CD US BANK 1.030% 06/25/04 1.030 50,000 CD US BANK 1.030% 06/25/04 1.030 50,000 CID GECC 05/28/04 1.020 50,000 CID GECC 05/28/04 1.020 50,000 CID GECC 05/28/04 1.020 50,000 CID GECC 05/28/04 1.020 50,000 CID GECC 06/16/04 1.030 50,000 CP GECC 06/16/04 1.030 50,000 CID GECC 06/16/04 1.030 50,000 CID GECC 06/16/04 1.030 50,000 CID FCAR 06/16/04 1.030 50,000 CID FCAR 06/16/04 1.030 50,000 CID FCAR 06/16/04 1.030 50,000 CID B/A 06/16/04 1.030 50,000 CID B/A 06/16/04 1.030 50,000 11 1.011 1.011 03/25/04 PURCHASES (continued) CP B/A 06/16/04 1.030 50,000 CP B/A 06/16/04 1.030 50,000 DISC NOTES FNMA 06/16/04 1.000 40,300 DISC NOTES FNMA 06/16/04 1.000 50,000 DISC NOTES FNMA 06/16/04 1.000 50,000 DISC NOTES FNMA 06/16/04 1.000 50,000 DISC NOTES FNMA 06/16/04 1.000 50,000 DISC NOTES FNMA 06/16/04 1.000 50,000 DISC NOTES FNMA 06/16/04 1.000 50,000 DISC NOTES FNMA 06/23/04 1.000 50,000 DISC NOTES FNMA 06/23/04 1.000 50,000 DISC NOTES FNMA 06/23/04 1.000 50,000 DISC NOTES FNMA 06/23/04 1.000 50,000 03/26/04 REDEMPTIONS BN BANC ONE 1.090% 03/26/04 1.090 50,000 151 228,597.22 1.108 BN BANC ONE 1.090% 03/26/04 1.090 50,000 151 228,597.22 1.108 BN BANC ONE 1.090% 03/26/04 1.090 50,000 151 228,597.22 1.108 BN BANC ONE 1.090% 03/26/04 1.090 50,000 151 228,597.22 1.108 CD US BANK 1.010% 03/26/04 1.010 50,000 10 14,027.78 1.024 CD US BANK 1.010% 03/26/04 1.010 50,000 10 14,027.78 1.024 CD DEXIA 1.015% 03/26/04 1.015 50,000 44 61,417.42 1.022 CD DEXIA 1.015% 03/26/04 1.015 50,000 44 61,417.42 1.022 CD NOVA SCOT 1.100% 03/26/04 1.100 50,000 151 230,694.44 1.118 CD NOVA SCOT 1.100% 03/26/04 1.100 50,000 151 230,694.44 1.118 CD RB SCOT 1.100% 03/26/04 1.100 25,000 154 117,638.89 1.118 CD RB SCOT 1.100% 03/26/04 1.100 50,000 154 235,277.78 1.118 CD NOVA SCOT 1.080% 03/26/04 1.080 50,000 163 244,500.00 1.098 CP COUNTRY 03/26/04 1.050 2,460 10 717.50 1.065 CP COUNTRY 03/26/04 1.050 50,000 10 14,583.33 1.065 CP SARA LEE 03/26/04 1.050 50,000 11 16,041.67 1.064 CP BEAR 03/26/04 1.000 50,000 11 15,277.78 1.014 CP BEAR 03/26/04 1.000 50,000 11 15,277.78 1.014 CP BEAR 03/26/04 1.000 50,000 11 15,277.78 1.014 CP BEAR 03/26/04 1.000 50,000 11 15,277.78 1.014 CP CITI GLOBAL 03/26/04 1.010 50,000 11 15,430.56 1.024 CP CITI GLOBAL 03/26/04 1.010 50,000 11 15,430.56 1.024 CP CITI GLOBAL 03/26/04 1.010 50,000 11 15,430.56 1.024 CP AMER EXP 03/26/04 1.010 50,000 25 35,069.44 1.025 CP AMER EXP 03/26/04 1.010 50,000 25 35,069.44 1.025 CP GMAC 03/26/04 1.220 50,000 28 47,444.44 1.242 CP GMAC 03/26/04 1.220 50,000 28 47,444.44 1.242 CP GMAC 03/26/04 1.220 50,000 28 47,444.44 1.242 CP GMAC 03/26/04 1.220 50,000 28 47,444.44 1.242 CP GE CO 03/26/04 1.030 15,000 32 13,733.33 1.048 CP GE CO 03/26/04 1.030 50,000 32 45,777.78 1.048 CP GE CO 03/26/04 1.030 50,000 32 45,777.78 1.048 CP GE CO 03/26/04 1.030 50,000 32 45,777.78 1.048 CP GMAC 03/26/04 1.240 50,000 36 62,000.00 1.261 12 03/26/04 REDEMPTIONS (continued) CID GE CO 03/26/04 1.030 50,000 42 60,083.33 1.048 CID GE CO 03/26/04 1.030 50,000 42 60,083.33 1.048 CID GE CO 03/26/04 1.030 50,000 42 60,083.33 1.048 CID GE CO 03/26/04 1.030 50,000 42 60,083.33 1.048 CID GMAC 03/26/04 1.300 50,000 74 133,611.11 1.325 CID FCAR 03/26/04 1.090 50,000 107 161,986.11 1.111 CID FCAR 03/26/04 1.090 50,000 107 161,986.11 1.111 CID FCAR 03/26/04 1.090 50,000 107 161,986.11 1.111 CID FCAR 03/26/04 1.090 50,000 107 161,986.11 1.111 CID JP MORGAN 03/26/04 1.080 50,000 126 189,000.00 1.102 CID JP MORGAN 03/26/04 1.080 50,000 126 189,000.00 1.102 CP JP MORGAN 03/26/04 1.080 50,000 126 189,000.00 1.102 DISC NOTES FHLMC 03/26/04 1.060 50,000 123 181,083.34 1.082 DISC NOTES FHLMC 03/26/04 1.060 50,000 123 181,083.34 1.082 DISC NOTES FNMA 03/26/04 1.080 50,000 134 201,000.00 1.102 DISC NOTES FNMA 03/26/04 1.080 50,000 134 201,000.00 1.102 DISC NOTES FNMA 03/26/04 1.080 50,000 134 201,000.00 1.102 DISC NOTES FNMA 03/26/04 1.080 50,000 134 201,000.00 1.102 DISC NOTES FNMA 03/26/04 1.070 50,000 161 239,263.89 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 161 239,263.89 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 DISC NOTES FNMA 03/26/04 1.070 50,000 162 240,750.00 1.093 03/26/04 PURCHASES CID GMAC 06/16/04 1.230 50,000 CID GMAC 06/16/04 1.230 50,000 CID GMAC 06/16/04 1.230 50,000 CID - GMAC 06/16/04 1.230 50,000 03/29/04 NO REDEMPTIONS 03/29/04 PURCHASES c/ DISC NOTES FNMA DISC NOTES FHLB DISC NOTES FHLB 03/29/04 PURCHASES 07/14/04 1.050 50,000 04/23/04 1.050 50,000 04/23/04 1.050 2,316 SBA FR 1.300% 02/25/29 1.300 28,500 CD UBS 1.045% 08/27/04 1.040 50,000 CD UBS 1.045% 08/27/04 1.040 50,000 CID NCAT 03/30/04 1.020 15,000 CID DISNEY 03/30/04 1.050 30,000 13 03/29/04 PURCHASES (continued) CID HOUSEHOLD 03/30/04 1.000 10,000 CID COUNTRY 03/30/04 1.040 46,872 CID COUNTRY 03/30/04 1.040 50,000 CID COUNTRY 03/30/04 1.040 50,000 CID HOUSEHOLD 03/30/04 1.000 50,000 CID HOUSEHOLD 03/30/04 1.000 50,000 CID NCAT 03/30/04 1.020 50,000 CID GMAC 07/01/04 1.230 20,000 CID GMAC 07/01/04 1.230 50,000 CID FCAR 08/20/04 1.050 50,000 CID FCAR 08/20/04 1.050 50,000 CID FCAR 08/20/04 1.050 50,000 CID GECC 08/27/04 1.040 50,000 CID GECC 08/27/04 1.040 50,000 CID GECC 08/27/04 1.040 50,000 03/30/04 REDEMPTIONS c/ DISC NOTES FNMA 07/14/04 1.050 50,000 1 1,423.51 1.065 DISC NOTES FHLB 04/23/04 1.050 50,000 1 1,427.07 1.065 DISC NOTES FHLB 04/23/04 1.050 2,316 1 66.09 1.065 03/30/04 REDEMPTIONS CD W/F 1.020% 03/30/04 1.020 50,000 33 46,750.00 1.037 CD W/F 1.020% 03/30/04 1.020 50,000 33 46,750.00 1.037 CD W/F 1.020% 03/30/04 1.020 50,000 33 46,750.00 1.037 CD W/F 1.020% 03/30/04 1.020 50,000 33 46,750.00 1.037 CID HOUSEHOLD 03/30/04 1.000 10,000 1 277.78 1.014 CID NCAT 03/30/04 1.020 15,000 1 425.00 1.034 CID DISNEY 03/30/04 1.050 30,000 1 875.00 1.065 CID COUNTRY 03/30/04 1.040 46,872 1 1,354.08 1.054 CID NCAT 03/30/04 1.020 50,000 1 1,416.67 1.034 CID COUNTRY 03/30/04 1.040 50,000 1 1,444.44 1.054 CID COUNTRY 03/30/04 1.040 50,000 1 1,444.44 1.054 CID HOUSEHOLD 03/30/04 1.000 50,000 1 1,388.89 1.014 CID HOUSEHOLD 03/30/04 1.000 50,000 1 1,388.89 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID CITI GLOBAL 03/30/04 1.000 50,000 6 8,333.33 1.014 CID MORG STAN 03/30/04 1.010 25,000 8 5,611.11 1.024 CID COUNTRY 03/30/04 1.050 27,810 8 6,489.00 1.065 CID COUNTRY 03/30/04 1.050 50,000 33 48,125.00 1.069 CID W/F 03/30/04 1.020 50,000 75 106,250.00 1.036 CID W/F 03/30/04 1.020 50,000 75 106,250.00 1.036 14 03/30/04 REDEMPTIONS (continued) CID GECC CID GECC 03/30/04 PURCHASES CD SVENSKA DISC NOTES FNMA DISC NOTES FNMA 03/31/04 REDEMPTIONS TREAS NOTES TREAS NOTES TREAS NOTES TREAS NOTES TREAS NOTES TREAS NOTES 03/30/04 1.100 50,000 154 235,277.78 03/30/04 1.100 50,000 154 235,277.78 1.050% 08/27/04 1.050 08/27/04 1.020 08/27/04 1.020 3.625% 03/31 /04 3.517 3.625% 03/31 /04 3.517 3.625% 03/31 /04 3.501 3.625% 03/31 /04 3.501 3.625% 03/31 /04 3.501 3.625% 03/31 /04 3.501 15 50,000 50,000 50,000 50,000 722 3,478, 867.83 50,000 722 3,478,867.83 50,000 726 3,483,051.57 50,000 726 3,483,051.57 50,000 726 3,483,051.57 50,000 726 3,483,051.57 1.124 1.124 3.517 3.517 3.501 3.501 3.501 3.501 a/ The abbreviations indicate the type of security purchased or sold; i.e., (U.S.) Bills, Bonds, Notes, Debentures, Discount Notes and Participation Certificates: Federal National Mortgage Association (FNMA), Farmers Home Administration Notes (FHA), Student Loan Marketing Association (SLMA), Small Business Association (SBA), Negotiable Certificates of Deposit (CD), Negotiable Certificates of Deposit Floating Rate (CD FR), Export Import Notes (EXIM), Bankers Acceptances (BA), Commercial Paper (CP), Government National Mortgage Association (GNMA), Federal Home Loan Bank Notes (FHLB), Federal Land Bank Bonds (FLB), Federal Home Loan Mortgage Corporation Obligation (FHLMC PC) & (FHLMC GMC), Federal Farm Credit Bank Bonds (FFCB), Federal Farm Credit Discount Notes (FFC), Corporate Securities (CB), US Ship Financing Bonds (TITLE XI'S), International Bank of Redevelopment (IBRD), Tennessee Valley Authority (TVA), Medium Term Notes (MTN), Real. Estate Mortgage Investment Conduit (REMIC). b/ Purchase or sold yield based on 360 day calculation for discount obligations and Repurchase Agreements. c/ Repurchase Agreement. d/ Par amount of securities purchased, sold or redeemed. e/ Securities were purchased and sold as of the same date. f/ Repurchase Agreement against Reverse Repurchase Agreement. g/ Outright purchase against Reverse Repurchase Agreement. h/ Security "SWAP" transactions. it Buy back agreement. RRS Reverse Repurchase Agreement. RRP Termination of Reverse Repurchase Agreement. 16 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT ($) DATE ALHAMBRA Bank of East Asia (USA) 11/19/03 1.070 6,000,000.00 05/19/04 Bank of East Asia (USA) 01/14/04 1.020 3,095,000.00 07/14/04 Bank of East Asia (USA) 02/11/04 1.060 3,000,000.00 08/11/04 Omni Bank 10/23/03 1.080 2,000,000.00 04/22/04 Omni Bank 02/13/04 0.980 2,000,000.00 05/14/04 Omni Bank 11/20/03 1.090 2,000,000.00 05/20/04 Omni Bank 02/19/04 0.970 2,000,000.00 05/27/04 Omni Bank 03/03/04 1.000 6,000,000.00 06/02/04 Omni Bank 03/17/04 1.050 2,000,000.00 09/15/04 ARROYO GRANDE Mid -State Bank 10/15/03 1.050 5,000,000.00 04/14/04 Mid -State Bank 11/19/03 1.070 5,000,000.00 05/19/04 Mid -State Bank 12/12/03 1.060 5,0001000.00 06/11/04 Mid -State Bank 01/15/04 1.010 5,000,000.00 07/15/04 Mid -State Bank 02/11/04 1.050 5,000,000.00 08/11/04 Mid -State Bank 03/12/04 1.040 5,000,000.00 09/09/04 BREA Jackson Federal Bank 02/18/04 0.970 10,000,000.00 05/19/04 Pacific Western National Bank 02/04/04 1.030 4,000,000.00 08/04/04 CALABASAS First Bank of Beverly Hills FSB 02/05/04 0.980 10,000,000.00 05/06/04 First Bank of Beverly Hills FSB 12/17/03 1.040 10,000,000.00 06/16/04 First Bank of Beverly Hills FSB 03/04/04 1.070 10,000,000.00 09/02/04 CAMARI LLO First California Bank 12/05/03 1.090 2,000,000.00 06/04/04 First California Bank 01/28/04 1.030 2,000,000.00 07/28/04 First California Bank 01/28/04 1.030 4,000,000.00 07/28/04 First California Bank 03/24/04 1.060 6,000,000.00 09/22/04 CAMERON PARK Western Sierra National Bank 01/14/04 0.990 7,000,000.00 07/14/04 Western Sierra National Bank 02/11/04 1.030 6,000,000.00 08/11/04 17 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT ($) DATE Tri Counties Bank 03/18/04 1.010 20,000,000.00 06/18/04 CITY OF INDUSTRY EverTrust Bank 12/11/03 1.070 6,000,000.00 06/10/04 EverTrust Bank 01/29/04 1.030 6,000,000.00 07/29/04 CONCORD Bank of the West 03/18/04 1.010 82,000,000.00 06/18/04 Bank of the West 01/07/04 0.970 134,000,000.00 04/08/04 Bank of the West 01/28/04 0.950 76,500,000.00 04/29/04 Bank of the West 01/29/04 0.950 100,000,000.00 04/29/04 Bank of the West 02/20/04 0.980 242,000,000.00 05/21/04 DUBLIN Operating Engineers FCU 10/08/03 1.050 5,000,000.00 04/07/04 Operating Engineers FCU 12/12/03 1.040 10,000,000.00 06/11/04 Operating Engineers FCU 02/11/04 1.030 5,000,000.00 08/11/04 EL CENTRO Valley Independent Bank 01/07/04 '1.000 20,000,000.00 04/08/04 Valley Independent Bank 01/16/04 0.960 20,000,000.00 04/16/04 Valley Independent Bank 01/23/04 0.960 32,500,000.00 04/23/04 EL SEGUNDO First Coastal Bank NA 01/22/04 1.020 2,000,000.00 07/21/04 First Coastal Bank NA 03/03/04 1.060 2,000,000.00 09/01/04 Hawthorne Savings FSB 01/07/04 0.970 60,000,000.00 04/08/04 Hawthorne Savings FSB 10/16/03 1.070 35,000,000.00 04/14/04 Hawthorne Savings FSB 11/20/03 1.090 25,000,000.00 05/20/04 Hawthorne Savings FSB 01/07/04 1.080 50,000,000.00 07/07/04 Hawthorne Savings FSB 02/05/04 1.060 15,000,000.00 08/05/04 Xerox Federal Credit Union 11/20/03 1.100 20,000,000.00 05/20/04 Xerox Federal Credit Union 03/04/04 1.080 20,000,000.00 09/02/04 Xerox Federal Credit Union 03/10/04 1.040 7,000,000.00 09/09/04 18 NAME FAIRFIELD Westamerica Bank Westamerica Bank Westamerica Bank FRESNO United Security Bank FULLERTON Fullerton Community Bank Fullerton Community Bank GOLETA Pacific Capital Bank Pacific Capital Bank Pacific Capital Bank Pacific Capital Bank Pacific Capital Bank GRANADA HILLS First State Bank of California First State Bank of California IRVINE Commercial Capital Bank Commercial Capital Bank Commercial Capital Bank Commercial Capital Bank Commercial Capital Bank Commercial Capital Bank Commercial Capital Bank Commercial Capital Bank LA JOLLA Silvergate Bank TIME DEPOSITS DEPOSIT PAR MATURITY DATE YIELD AMOUNT ($) DATE 01 /09/04 0.960 60, 000, 000.00 04/09/04 01/14/04 0.910 30,000,000.00 04/15/04 01 /22/04 0.920 50, 000, 000.00 04/23/04 01 /21 /04 0.950 40,000,000.00 04/21 /04 11/19/03 1.080 9,000,000.00 05/19/04 01 /23/04 1.020 8, 000, 000.00 07/23/04 01/09/04 0.960 23,000,000-00 04/01/04 09/17/03 1.050 25,000,000.00 04/01/04 10/01 /03 1.050 30, 000, 000.00 04/01/04 12/10/03 1.030 85,000,000.00 06/09/04 02/13/04 1.050 61,000,000.00 08/13/04 10/23/03 1.060 3,000,000.00 04/22/04 03/19/04 1.030 2,000,000.00 09/17/04 10/17/03 1.040 10,000,000.00 04/15/04 10/31 /03 1.060 20, 000, 000.00 04/29/04 11/20/03 1.070 20,000,000.00 05/20/04 12/17/03 1.020 10,000,000.00 06/16/04 01 /08/04 1.060 10, 000, 000.00 07/08/04 07/29/04 1.010 10,000,000.00 07/29/04 02/19/04 1.010 15,000,000.00 08/19/04 02/26/04 1.060 14,000,000.00 08/26/04 03/12/04 1.060 5,000,000.00 09/10/04 19 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT ($) DATE LAKEPORT Lake Community Bank 01/14/04 0.990 2,000,000.00 07/14/04 LODI Bank of Lodi 06/17/04 1.020 5,000,000.00 06/17/04 Bank of Lodi 03/24/04 1.080 5,000,000.00 09/22/04 Farmers & Merchant Bk Cen CA 10/10/03 1.050 10,000,000.00 04/08/04 LOS ANGELES Broadway Federal Bank 01/09/04 1.070 2,500,000.00 07/09/04 Broadway Federal Bank 03/12/04 1.050 3,000,000.00 09/10/04 Cathay Bank 01/07/04 0.970 38,000,000.00 04/08/04 Cathay Bank 02/18/04 1.030 15,000,000.00 08/18/04 Cathay Bank 03/03/04 1.050 17,000,000.00 09/01/04 Cathay Bank 03/10/04 1.030 30,000,000.00 09/09/04 Cedars Bank 10/22/03 1.080 4,000,000.00 04/21/04 Cedars Bank 01/07/04 1.080 5,000,000.00 07/07/04 Cedars Bank 02/20/04 1.040 2,000,000.00 08/20/04 Cedars Bank 03/12/04 1.050 4,500,000.00 09/10/04 Center Bank 01/07/04 0.970 10,000,000.00 04/08/04 Center Bank 12/23/03 1.000 5,000,000.00 06/23/04 Center Bank 01/22/04 1.010 5,000,000.00 07/21/04 Center Bank 03/17/04 1.050 40,000,000.00 09/15/04 CHB America Bank 10/15/03 1.030 3,300,000.00 04/14/04 CHB America Bank 11/21/03 1.060 4,000,000.00 05/21/04 CHB America Bank 03/03/04 0.980 2,000,000.00 06/02/04 CHB America Bank 01/15/04 0.990 1,000,000.00 07/15/04 CHB America Bank 03/05/04 1.030 2,000,000.00 09/01/04 CHB America Bank 03/31/04 1.050 3,000,000.00 09/29/04 Eastern International Bank 11/05/03 1.080 900,000.00 05/05/04 Eastern International Bank 12/11/03 1.050 1,000,000.00 06/10/04 Hanmi Bank 01/16/04 0.940 25,000,000.00 04/16/04 Hanmi Bank 02/04/04 0.990 25,000,000.00 05/05/04 Hanmi Bank 03/05/04 1.020 25,000,000.00 06/03/04 Hanmi Bank 03/17/04 1.010 25,000,000.00 06/17/04 Mellon First Business Bank 01/09/04 0.960 50,000,000.00 04/09/04 Mellon First Business Bank 03/18/04 1.010 50,000,000.00 06/18/04 Mirae Bank 04/16/04 0.940 4,000,000.00 04/16/04 Nara Bank, NA 01/07/04 0.970 5,000,000.00 04/08/04 Nara Bank, NA 10/23/03 1.080 10,000,000.00 04/22/04 Nara Bank, NA 01/23/04 0.930 10,000,000.00 04/23/04 20 NAME LOS ANGELES (continued TIME DEPOSITS DEPOSIT PAR MATURITY DATE YIELD AMOUNT ($) DATE Nara Bank, NA 11/14/03 1.110 5,000,000.00 05/13/04 Nara Bank, NA 02/19/04 0.970 5,000,000.00 .05/19/04 Nara Bank, NA 03/12/04 1.010 10,000,000.00 06/11/04 Nara Bank, NA 02/04/04 1.050 10,000,000.00 08/04/04 Pacific Union Bank 10/31/03 1.080 10,000,000.00' 04/29/04 Pacific Union Bank 12/15/03 1.040 20,000,000.00 06/16/04 Pacific Union Bank 01/08/04 1.080 10,000,000.00 07/08/04 Pacific Union Bank 03/04/04 1.070 20,000,000.00 09/02/04 Preferred Bank 02/06/04 0.990 4,000,000.00 05/07/04 Preferred Bank 03/19/04 1.060 31,000,000.00 09/17/04 Sae Han Bank 02/13/04 0.980 2,000,000.00 05/14/04 Sae Han Bank 02/20/04 0.980 12,000,000.00 05/14/04 State Bank of India (California) 11/20/03 1.000 2,000,000.00 05/20/04 State Bank of India (California) 01/07/04 1.090 3,000,000.00 07/07/04 Western Federal Credit Union 10/23/03 1.080 30,000,000.00 04/22/04 Wilshire State Bank 01/08/04 0.970 7,000,000.00 04/09/04 Wilshire State Bank 11/14/03 1.110 2,000,000.00 05/13/04 Wilshire State Bank 11/14/03 1.110 6,000,000.00 05/13/04 Wilshire State Bank 12/15/03 1.040 1,000,000.00 06/17/04 Wilshire State Bank 12/17/03 1.040 2,000,000.00 06/17/04 Wilshire State Bank 12/15/03 1.040 4,000,000.00 06/17/04 Wilshire State Bank 12/17/03 1.040 5,000,000.00 06/17/04 Wilshire State Bank 02/05/04 1.060 8,000,000.00 07/30/04 Wilshire State Bank 02/25/04 1.060 7,000,000.00 08/25/04 Wilshire State Bank 03/05/04 1.070 3,000,000.00 09/03/04 Wilshire State Bank 03/19/04 1.050 8,000,000.00 09/17/04 MERCED County Bank 01/15/04 0.940 10,000,000.00 04/16/04 County Bank 12/03/03 1.100 5,000,000.00 06/02/04 County Bank 03/10/04 1.040 10,000,000.00 09/09/04 MONTEREY PARK Trust Bank FSB 10/01/03 1.080 3,000,000.00 04/01/04 Trust Bank FSB 12/19/03 1.050 2,000,000.00 07/01/04 Trust Bank FSB 01/07/04 1.080 3,000,000.00 07/07/04 NORTH HIGHLANDS Safe Credit Union 01/16/04 0.930 5,000,000.00 04/16/04 21 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT ($) DATE NORTH HIGHLANDS (continued) Safe Credit Union 02/13/04 0.980 20,000,000.00 05/14/04 OAKDALE Oak Valley Community Bank 01/16/04 0.930 2,500,000.00 04/16/04 Oak Valley Community Bank 03/18/04 1.060 3,500,000.00 09/16/04 OAKLAND Metropolitian Bank 10/29/03 1.080 1,000,000.00 04/28/04 Metropolitian Bank 12/04/03 1.100 1,000,000.00 06/03/04 Metropolitian Bank 01/23/04 1.010 1,000,000.00 07/23/04 Metropolitian Bank 02/26/04 1.060 1,000,000.00 08/26/04 Metropolitian Bank 03/24/04 1.050 2,000,000.00 09/22/04 ONTARIO Citizens Business Bank 10/03/03 1.050 25,000,000.00 04/02/04 Citizens Business Bank 11/20/03 1.090 30,000,000.00 05/20/04 Citizens Business Bank 12/05/03 1.080 25,000,000.00 06/04/04 Citizens Business Bank 02/06/04 1.060 30,000,000.00 08/06/04 Citizens Business Bank 03/24/04 1.050 30,000,000.00 09/22/04 PALO ALTO Bank of Petaluma 02/19/04 1.040 3,500,000.00 08/19/04 Bank of Petaluma 03/11/04 1.050 12,000,000.00 09/09/04 Bank of Santa Clara 02/19/04 1.040 20,000,000.00 08/19/04 Bay Bank of Commerce 10/29/03 1.090 5,000,000.00 04/28/04 Coast Commercial Bank 01/14/04 1.030 5,000,000.00 07/14/04 Coast Commercial Bank 02/19/04 1.050 20,000,000.00 08/19/04 Cupertino National Bank 10/29/03 1.090 35,000,000.00 04/28/04 Cupertino National Bank 11/21/03 1.090 20,000,000.00 05/21/04 Cupertino National Bank 01/14/04 1.020 10,000,000.00 07/14/04 Cupertino National Bank 03/11/04 1.050 10,000,000.00 09/09/04 Golden Gate Bank 11 /21 /03 1.110 9,000, 000.00 05/21 /04 Mid -Peninsula Bank 10/29/03 1.080 35,000,000.00 04/28/04 Mid -Peninsula Bank 02/19/04 1.030 5,000,000.00 08/19/04 Mid -Peninsula Bank 03/11/04 1.040 10,000,000.00 09/09/04 Mt. Diablo National Bank 03/11/04 1.050 10,000,000.00 09/09/04 Peninsula Bank of Commerce 02/19/04 1.030 15,000,000.00 08/19/04 San Jose National Bank 10/29/03 1.100 20,000,000.00 04/28/04 22 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT ($) DATE PALO ALTO (continued) San Jose National Bank 11/21/03 1.100 20,000,000.00 05/21/04 PALOS VERDES ESTATES Malaga Bank 11/14/03 1.090 7,000,000.00 05/13/04 Malaga Bank 12/17/03 1.020 4,000,000.00 06/16/04 Malaga Bank 12/17/03 1.020 5,000,000.00 06/16/04 Malaga Bank 02/20/04 1.020 10,000,000.00 08/20/04 Malaga Bank 03/05/04 1.050 4,000,000.00 09/03/04 PASADENA Community Bank 10/10/03 1.050 10,000,000.00 04/08/04 Community Bank 10/15/03 1.050 15,000,000.00 04/14/04 Community Bank 11/06/03 1.090 15,000,000.00 05/06/04 Community Bank 12/17/03 1.040 10,000,000.00 06/16/04 Community Bank 01/09/04 1.070 10,000,000.00 07/09/04 Community Bank 03/17/04 1.050 10,000,000.00 09/15/04 Wescom Credit Union 11/19/03 1.090 10,000,000.00 05/19/04 Wescom Credit Union 03/24/04 1.070 25,000,000.00 09/22/04 PASO ROBLES Hacienda Bank 03/10/04 1.010 1,000,000.00 06/09/04 PLACERVILLE El Dorado Savings Bank 04/10/03 1.280 10,000,000.00 04/01/04 El Dorado Savings Bank 04/30/03 1.310 5,000,000.00 04/30/04 El Dorado Savings Bank 06/10/03 1.100 20,000,000.00 06/04/04 PLEASANTON Valley Community Bank 03/19/04 1.070 6,000,000.00 09/17/04 POMONA PFF Bank and Trust 12/10/03 1.050 20,000,000.00 06/09/04 PFF Bank and Trust 02/27/04 1.070 8,000,000.00 08/27/04 23 ITil-. PORTERVILLE Bank of the Sierra RANCHO SANTA FE La Jolla Bank, FSB La Jolla Bank, FSB La Jolla Bank, FSB La Jolla Bank, FSB La Jolla Bank, FSB REDDING North Valley Bank REDWOOD CITY Provident Central Credit Union ROCKLIN Five Star Bank Five Star Bank RICHMOND Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank Mechanics Bank RIVERSIDE Provident Savings Bank TIME DEPOSITS DEPOSIT PAR MATURITY . DATE YIELD AMOUNT ($) DATE 10/23/03 1.090 10,000,000.00 04/22/04 11/20/03 1.070 25,000,000.00 05/20/04 03/04/04 1.000 10,000,000.00 06/03/04 02/04/04 1.030 25,000,000.00 08/04/04 02/13/04 1.030 15,000,000.00 08/13/04 03/05/04 1.050 10,000,000.00 09/02/04 12/12/03 1.040 3,000,000.00 06/11/04 10/31 /03 1.060 20, 000, 000.00 04/29/04 01/28/04 1.000 2,000,000.00 07/28/04 03/31/04 1.030 2,000,000.00 09/29/04 04/01 /03 1.320 10, 000, 000.00 04/01 /04 04/23/03 1.390 10, 000, 000.00 04/21 /04 06/12/03 1.090 10,000,000.00 06/09/04 07/09/03 1.110 10,000,000.00 07/08/04 08/08/03 1.370 10,000,000.00 08/04/04 09/12/03 1.290 10,000,000.00 09/10/04 10/ 15/03 1.260 10, 000, 000.00 10/15/04 10/31 /03 1.300 10,000,000.00 10/29/04 11 /07/03 1.380 10, 000, 000.00 11 /05/04 03/03/04 1.260 10,000,000.00 03/03/05 03/25/04 1.050 25,000,000.00 09/23/04 24 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT DATE SACRAMENTO American River Bank 10/09/03 1.030 1,500,000.00 04/07/04 American River Bank 12/19/03 1.030 1,000,000.00 06/18/04 American River Bank 01/09/04 1.050 1,000,000.00 07/09/04 American River Bank 01/29/04 1.010 1,500,000.00 07/29/04 American River Bank 02/27/04 1.050 2,000,000.00 08/27/04 American River Bank 03/19/04 1.030 1,250,000.00 09/17/04 American River Bank 03/25/04 1.030 2,000,000.00 09/23/04 Bank of Sacramento 12/19/03 1.050 2,000,000.00 06/18/04 Bank of Sacramento 02/11/04 1.060 1,500,000.00 08/11/04 Bank of Sacramento 03/03/04 1.060 2,000,000.00 09/01/04 Merchants National Bank 10/15/03 1.050 2,000,000.00 04/14/04 Merchants National Bank 01/22/04 1.010 2,000,000.00 07/21/04 River City Bank 10/09/03 1.060 2,000,000.00 04/07/04 River City Bank 01/29/04 0.970 3,000,000.00 04/30/04 River City Bank 02/26/04 1.010 2,000,000.00 05/27/04 U.S. Bank 01/08/04 1.090 100,000,000.00 07/08/04 U.S. Bank 02/04/04 1.050 25,000,000.00 08/04/04 U.S. Bank 02/11/04 1.050 50,000,000.00 08/11/04 U.S. Bank 02/20/04 1.040 50,000,000.00 08/20/04 Union Bank of California 01/16/04 0.940 175,000,000.00 04/16/04 Union Bank of California 02/04/04 0.990 150,000,000.00 05/05/04 Union Bank of California 03/18/04 1.020 150,000,000.00 06/18/04 SAN DIEGO First Future Credit Union 12/03/03 1.090 15,000,000.00 06/02/04 First Future Credit Union 12/17/03 1.040 3,000,000.00 06/16/04 First Future Credit Union 12/17/03 1.040 5,000,000.00 06/16/04 First Future Credit Union 02/27/04 1.070 5,000,000.00 08/27/04 First United Bank 10/17/03 1.070 2,000,000.00 04/15/04 First United Bank 02/13/04 1.060 1,000,000.00 08/13/04 Mission Federal Credit Union 01/15/04 1.020 10,000,000.00 07/15/04 Mission Federal Credit Union 03/03/04 1.060 10,000,000.00 09/01/04 Neighborhood National Bank 02/20/04 1.020 2,000,000.00 08/20/04 North Island Federal Credit Union 01/09/04 0.980 5,000,000.00 04/09/04 SAN FRANCISCO American California Bank 01/08/04 1.090 4,000,000.00 07/08/04 American California Bank 03/05/04 1.080 2,000,000.00 09/03/04 Citibank (West) FSB 01/08/04 1.108 150,000,000.00 07/08/04 Citibank (West) FSB 01/15/04 1.050 100,000,000.00 07/15/04 25 TIME VEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT M DATE SAN FRANCISCO (continued Citibank (West) FSB 01/22/04 1.050 100,000,000.00 07/21/04 Citibank (West) FSB 01/28/04 1.050 25,000,000.00 07/28/04 Oceanic Bank 09/12/03 1.260 4,000,000.00 09/10/04 Trans Pacific National Bank 12/23/03 1.010 1,000,000.00 06/23/04 Trans Pacific National Bank 02/05/04 1.070 1,000,000.00 08/05/04 Trans Pacific National Bank 03/25/04 1.060 1,000,000.00 09/23/04 United Commercial Bank 01/07/04 0.980 40,000,000.00 04/08/04 United Commercial Bank 01/08/04 0.980 55,000,000.00 04/09/04 United Commercial Bank 02/26/04 1.010 20,000,000.00 05/27/04 United Commercial Bank 12/05/03 1.090 25,000,000.00 06/04/04 United Commercial Bank 12/12/03 1.070 25,000,000.00 06/11/04 United Commercial. Bank 01/14/04 1.020 50,000,000.00 07/14/04 United Commercial Bank 01/28/04 1.030 40,000,000.00 07/28/04 United Commercial Bank 03/03/04 1.060 50,000,000.00 09/01/04 United Commercial Bank 03/19/04 1.060 65,000,000.00 09/17/04 SAN DOSE Comerica Bank of California 01/07/04 0.980 134,000,000.00 04/08/04 Comerica Bank of California 01/16/04 0.940 183,000,000.00 04/16/04 Heritage Bank of Commerce 02/11/04 1.060 2,000,000.00 08/11/04 Heritage Bank of Commerce 02/11/04 1.060 2,000,000.00 08/11/04 Meriwest Credit Union 10/17/03 1.090 5,000,000.00 04/14/04 Meriwest Credit Union 10/16/03 1.070 5,000,000.00 04/14/04 Meriwest Credit Union 01/22/04 1.040 5,000,000.00 07/21/04 Meriwest Credit Union 03/17/04 1.080 5,000,000.00 09/15/04 Santa Clara Co. Fed. C.U. 02/06/04 1.000 5,000,000.00 05/07/04 Santa Clara Co. Fed. C.U. 02/06/04 1.080 10,000,000.00 08/06/04 SAN LUIS OBISPO First Bank Of San Luis Obispo 12/05/03 1.090 4,500,000.00 06/04/04 First Bank Of San Luis Obispo 02/11/04 1.060 6,000,000.00 08/11/04 First Bank Of San Luis Obispo 03/17/04 1.060 7,000,000.00 09/15/04 First Bank Of San Luis Obispo 03/26/04 1.050 5,000,000.00 09/24/04 Mission Community Bank 10/08/03 1.080 2,500,000.00 04/07/04 Mission Community Bank 12/11/03 1.080 1,000,000.00 06/10/04 Mission Community Bank 03/04/04 1.080 1,000,000.00 09/02/04 San Luis Trust Bank 03/11/04 0.980 700,000.00 04/21/04 San Luis Trust Bank 10/22/03 1.060 1,000,000.00 04/21/04 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT DATE SAN MARINO East West Federal Bank 11/20/03 1.090 38,000,000.00 05/20/04 East West Federal Bank 01/09/04 1.070 42,000,000.00 07/09/04 East West Federal Bank 02/06/04 1.060 35,000,000.00 08/06/04 East West Federal Bank 03/12/04 1.050 35,000,000.00 09/10/04 SANTA ROSA National Bank of the Redwoods 10/31/03 1.080 5,000,000.00 04/29/04 National Bank of the Redwoods 01/22/04 1.010 10,000,000.00 07/21/04 National Bank of the Redwoods 02/11/04 1.050 5,000,000.00 08/11/04 North Coast Bank 12/16/03 1.040 1,250,000.00 06/17/04 SONORA Central California Bank 03/26/04 1.040 5,000,000.00 09/24/04 STOCKTON Pacific State Bank 10/09/03 1.050 1,000,000.00 04/07/04 Pacific State Bank 01/08/04 1.090 1,000,000.00 07/08/04 Union Safe Deposit Bank 01/15/04 0.940 10,000,000.00 04/16/04 Union Safe Deposit Bank 01/23/04 0.940 15,000,000.00 04/23/04 Union Safe Deposit Bank 02/05/04 0.990 15,000,000.00 05/06/04 Union Safe Deposit Bank 02/13/04 0.990 15,000,000.00 05/14/04 Union Safe Deposit Bank 03/05/04 1.020 15,000,000.00 06/03/04 Union Safe Deposit Bank 03/11/04 1.010 10,000,000.00 06/10/04 Washington Mutual Bank 12/17/03 1.040 45,000,000.00 06/16/04 Washington Mutual Bank 01/22/04 1.010 75,000,000.00 07/21/04 Washington Mutual Bank 02/20/04 1.040 60,000,000.00 08/20/04 TORRANCE China Trust Bank (USA) 01/16/04 0.940 15,000,000.00 04/16/04 China Trust Bank (USA) 01/16/04 0.940 25,000,000.00 04/16/04 China Trust Bank (USA) 01/22/04 0.930 30,000,000.00 04/23/04 China Trust Bank (USA) 02/13/04 0.990 20,000,000.00 05/14/04 China Trust Bank (USA) 03/12/04 1.020 35,000,000.00 06/11/04 TRACY Service 1st Bank 03/17/04 1.030 4,000,000.00 06/17/04 27 TIME DEPOSITS DEPOSIT PAR MATURITY NAME DATE YIELD AMOUNT ($) DATE TUSTIN Sunwest Bank Sunwest Bank Sunwest Bank VACAVILLE Travis Credit Union WHITTIER Quaker City Bank Quaker City Bank Quaker City Bank TOTAL TIME DEPOSITS MARCH 2O04 01/16/04 0.910 6,000,000.00 04/16/04 02/11/04 0.960 7,800,000.00 05/12/04 03/10/04 0.970 1,000,000.00 06/09/04 12/04/03 1.090 40,000,000.00 06/02/04 12/05/03 1.080 25,000,000.00 06/04/04 01/14/04 1.010 24,000,000.00 07/14/04 03/31 /04 1.050 16, 000, 000.00 .09/29/04 6,881,295,000.00 28 BANK DEMAND DEPOSITS March 2004 ($ in thousands) DAILY BALANCES DAY OF BALANCES WARRANTS MONTH PER BANKS OUTSTANDING 1 $ 2,023,886 $ 1,413,382 2 2,281,749 1,730,316 3 2,415,960 1,994,780 4 1,216,201 2,663,337 .6 1,048,644 2,814,395 6 1,048,644 2,814,395 7 1,048,644 2,814,395 8 1,155,891 2,855,192 9 1,510,963 2,628,479 10 1,436,730 2,531,724 11 1,486,528 2,806,347 12 1,456,065 2,856,969 13 1,456,065 2,856,959 14 1,456,065 2,856,959 15 1,331,480 2,801,089 16 1,153,448 2,630,194 17 1,254,168 2,510,211 18 1,309,587 2,722,183 19 1,435,697 2,767,723 20 1,435,591 2,757,723 21 1,435,697 2,767,723 22 1,496,363 2,299,748 23 1,637,918 2,136,948 24 1,691,145 2,108,418 25 1,567,503 2,155,220 26 1,764,907 2,634,817 27 1,754,907 2,634,817 28 1,754,907 2,634,817 29 1,684,468 2,527,642 30 1,260,430 2,894,662 31 2,118,139 2,899,417 AVERAGE DOLLAR DAYS $ 1,616,716 a/ The prescribed bank balance for March was $1,473,509. This consisted of $1,337,090 in compensating balances for services, balances for uncollected funds of $140,307 and a deduction of $3,888 for March delayed deposit credit. 28 DESIGNATION BY POOLED MONEY INVESTMENT BOARD OF TREASURY POOLED MONEY INVESTMENTS AND DEPOSITS No. 1657 in accordance with sections 16480 through 16480.8 of the Government Code, the Pooled Money Investment Board, at its meeting on March 17, 2004, has determined and designated the amount of money available for deposit and investment under said sections. In accordance with sections 16480.1 and 16480.2 of the Government Code, it is the intent that the money available for deposit or investment be deposited in bank accounts and savings and loan associations or invested in securities in such a manner so as to realize the maximum return consistent with safe and prudent treasury management, and the Board does hereby designate the amount of money available for deposit in bank accounts, savings and loan associ- actions, and for investment in securities and the type of such deposits and investments as follows: 1. In accordance with law, for deposit in demand bank accounts as Compensating Balance for Services $1,337,090,000 The active noninterest-bearing bank accounts designation constitutes a calendar month average balance. For purposes of computing the compensating balances, the Treasurer shall exclude from the daily balances any amounts contained therein as a result of nondelivery of securities purchased for "cash" for the Pooled Money Investment Account and shall adjust for`any deposits not credited by the bank as of the date of deposit. The balances in such accounts may fall below the above amount provided that the balances computed by dividing the sum of daily balances of that calendar month by the number of days in the calendar month reasonably approximates that amount. The balances may exceed this amount during heavy collection periods or in anticipation of large impending warrant presentations to the Treasury, but the balances are to be maintained in such a manner as to realize the maximum return consistent with safe and prudent treasury management. 2. In accordance with law, for investment in securities authorized by section 16430, Government Code, or in term interest - bearing deposits in banks and savings and loan associations as follows: Time Deposits in Various Financial Institutions In Securities (sections 16503a Estimated From To Transactions (section 16430)* and 16602)* Total ( 1) 03/15/04 03/19/04 $ 786,300,000 $ 45,651,805,000 $ 5,852,295,000 $ 51,504,100,000 (2) 03/22/04 03/26/04 $ (774,500,000) $ 44,877,305,000 $ 5,852,295,000 $ 50,729,600,000 (3) 03/29/04 04/02/04 $ (2,554,000,000) $ 42,323,305,000 $ 5,852,295,000 $ 48,175,600,000 (4) 04/05/04 04/09/04 $ 605,900,000 $ 42,929,205,000 $ 5,852,295,000 $ 48,781,500,000 (5) 04/12/04 04/16/04 $ 2,191,700,000 $ 45,120,905,000 $ 5,852,295,000 $ 50,973,200,000 (6) 04/19/04 04/23/04 $ 2,584,100,000 $ 47,705,005,000 $ 5,852,295,000 $ 53,557,300,000 From any of the amounts specifically designated above, not more than 30 percent in the aggregate may be invested in prime commercial paper under section 16430(e), Government Code. Additional amounts available in treasury trust account and in the Treasury from time to time, in excess of the amounts and for the same types of investments as specifically designated above. Provided, that the availability of the amounts shown under paragraph 2 is subject to reduction in the amount by which the bank accounts under paragraph 1 would otherwise be reduced below the calendar month average balance of $1,337,090,000. Dated: March 17, 2004 * Government Code POOLED MONEY INVESTMENT BOARD: Signatures on file at STO and SCO Chairperson Member Member BOARD MEMBER ITEMS