2018-07-06 Special Meeting Agenda

SPECIAL MEETING AGENDA    6 JULY 2018




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SPECIAL MEETING AGENDA                                                               6 JULY 2018

 INVESTMENT OF SURPLUS FUNDS POLICY

  Portfolio investment parameters and credit requirements
 The following table shows the credit ratings and counterparty limits for Council:
   Short Term Rating (Standard & Poor’s) or equivalent | Individual            Total Limit
                                                               Counterparty
                                                              Limit
   A1+ - Financial Institutions                                                100%
   A1+ - Bond Mutual Funds

   A2 — Financial Institutions
   A3 — Financial Institutions
 [Unrated                                                    NAN
   QIC / QTC Pooled Cash Management Fund                                       100%

  It is noted that for the purposes of this investment portfolio, the percentage limits apply effective from
 the date of purchase as a percentage of the market value of the portfolio. No more than 20 per cent
 of the portfolio is to be invested in Floating Rate Notes.
 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).
  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 CEO 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 Manager
  Financial Services 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 Manager Financial
  Services and evidenced by safekeeping receipts may hold security documents.

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