Meeting papers

When considering investment options, the investment officer will establish a margin of 10 basis
points in interest rate returns to give preference to those institutions considered to be responsible
investors (e.g. do not invest in fossil fuel companies).

Council also recognises the contributions made within the region and as such, for local community
banks with a physical presence in the region and a Standard and Poor’s Long Term Rating or better,
council will allow limited investments with these entities.

Maturity
The maturity structure of the portfolio will reflect a maximum term to maturity of no longer than 12
months.

Liquidity requirement
Given the nature of the funds invested, no more than 20 per cent of the investment portfolio will be
held in illiquid securities and at least 10 per cent of the portfolio can be called at no cost or will mature
within 0-7 days.

Breaches
Any breach of this policy is to be reported to the Chief Executive Officer and rectified within 24 hours
of the breach occurring.

Where Council holds an investment that is downgraded below the minimum acceptable rating level,
as prescribed under regulation for the investment arrangement, Council shall within 28 days after
the change becomes known to the local government, either obtain Treasurer’s approval for
continuing with the investment arrangement or sell the investment arrangement (including, for
example, withdrawing a deposit).

Where limits for different risk categories or where counterparty limits are breached, the Financial
Services Manager will bring the matter to the attention of the Director Corporate Services with a
recommendation on potential options (e.g. continuing with the investment through until maturity, or
withdrawing a deposit).

Safekeeping and custody
Each transaction will require written confirmation by the broker/dealer/bank. Council will hold security
documents, or alternatively a third-party custodian authorised by the Financial Services Manager
and evidenced by safekeeping receipts may hold security documents.

Criteria of authorised dealers and broker
Council will maintain a list of authorised financial institutions and securities brokers that the
investment officers may deal with. These financial intermediaries must have a minimum long term
rating of at least either A+/A1/A+ from Standard and Poors, Moodys or Fitch IBCA.

All transactions undertaken on behalf of the investment portfolio of Council will be executed either
by Council directly, or through securities brokers registered as Australian Financial Service
Licensees (ASIC) with an established sales presence in Australia, or direct issuers that directly issue
their own securities which are registered on Council’s approved list of brokers/dealers and direct
issuers.


REPORTING
The Financial Services Manager will prepare a monthly report and evaluation of the transactions,
concentrations, performance and compliance of the investment portfolio. The report will include:
•    summary of securities held at the end of the reporting period by counterparty;
•    liquidity of the portfolio as at reporting date;
•     percentage of the portfolio considered ethical investment;


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