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San Leandro Investment Policy Statement Page 6 of 18 <br /> <br /> <br /> <br /> <br /> <br />issuer. Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio <br />may be invested in Commercial Paper if the Agency’s investment assets under management <br />are greater than $100,000,000. <br /> <br />Medium-Term Corporate Notes are corporate bonds and notes of industrial companies, <br />banks, bank holding companies, insurance companies, thrifts, and finance companies with <br />a maximum maturity of five years. Issuers must be corporations organized and operating <br />in the United States or by depository institutions licensed by the United States, any state or <br />operating within the United States. Securities issued by corporations must be rated “A” or <br />better by an NRSRO. Purchases may not exceed 30% of the City’s portfolio with a maximum <br />percentage of 5% per issuer. <br /> <br />Repurchase Agreements are agreements between the City and seller for the City to <br />purchase government securities to be resold back to the seller at a specific date and for a <br />specific amount. The legal maximum maturity on these investments is 360 days; however, <br />repurchase agreements are generally short-term investments. Investments in Repurchase <br />Agreements must be collateralized, with collateral limited to Treasury and Agency securities <br />at 102% of market value of principal and accrued interest; and these investments must be <br />supported by a master repurchase agreement with the bank or dealer. Holdings cannot <br />exceed 20% of the City’s portfolio. <br /> <br />Reverse Repurchase Agreements are a sale of securities by the local agency with a <br />simultaneous agreement for the local agency to repurchase the securities on or before a <br />specified date. Reverse purchase agreements must comply with statutory requirements and <br />are fully collateralized by delivery to a third-party custodian. The maximum term for reverse <br />repurchase agreements shall be 92 days. The proceeds of reverse repurchase transactions <br />must be invested in securities having maturities shorter than or equal to the term of the <br />underlying agreement. Reverse repurchase agreements cannot exceed 20% of the City’s <br />portfolio. <br /> <br />Passbook Savings Accounts or Time Certificates of Deposit are fixed term, non- <br />negotiable investments which are required to be collateralized 110% by eligible pooled <br />U.S. Government Securities. Promissory notes secured by first mortgages or trust deeds <br />used as collateral require a market value of at least 150% of the amount deposited. There <br />are no portfolio limits. <br /> <br />Money Market Mutual Funds consisting of investment securities permitted under <br />Sections 53601 and 53635 of the California Government Code. To be eligible for City <br />investments, companies providing mutual funds shall have either or both of the following: <br /> <br />1. The highest rating provided by not less than two of the three largest nationally <br />recognized statistical-rating services (NSRSO). <br />2. An investment advisor registered with the Securities and Exchange Commission <br />for not less than five years having investment experience in the underlying <br />securities and with assets under management in excess of $500 million. <br /> <br />Holdings cannot exceed 20% of the City’s portfolio.