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City of San Leandro City Council Meeting Date: October 16, 2023 Agenda Number: 5.d. Agenda Section: CONSENT CALENDAR File Number: 23-462 File Type: Staff Report Adopt a Resolution to Accept the 2022-2023 Fourth Quarter City of San Leandro Investment Report SUMMARY AND RECOMMENDATIONS Staff recommends the City Council adopt a resolution accepting the City Investment Report for the quarter ended June 30, 2023. BACKGROUND The purpose of the City of San Leandro Investment Report is to inform the City Council of the City’s investment portfolio status as of the end of the fourth quarter (and fiscal year), June 30, 2023. The City’s Investment Policy Statement requires quarterly reporting on specific investments, amounts invested with approved institutions, and purchase and maturity dates and interest yields. DISCUSSION As of June 30, 2023, the City’s investment portfolio had a market value of $243,375,000, which is $14,363,000 higher than the prior quarter, March 31, 2023. The increase was mainly due to receipt of monthly sales tax revenue during the quarter. Nearly $85,091,000 of the total market value was placed with the Local Agency Investment Fund (LAIF) and bank accounts. A total of $158,283,000 was placed in the Chandler Asset Management portfolio. The rate of return for cash deposits (LAIF and bank balances) at the end of the quarter was 1.51%, while the average book yield for the Chandler managed funds was 2.67%. The cash deposit return was 0.02 percentage points higher than the previous quarter, while the Chandler return was 0.27 percentage points higher. LAIF’s investment (46% of cash deposits) rate reflects a snapshot in time (the quarterly apportionment rate), while Chandler’s reflects the performance of the portfolio over the entire quarter. The City’s investment policy establishes criteria for the standard for portfolio performance. The Chandler managed fund criteria are compared with the ICE Bank of America 1-3-year US Treasury and Agency Index. This index is an unmanaged index tracking performance of direct sovereign debt of the U.S. Government having a maturity of at least one year and less than three years. The benchmark for Average Market Yield for the period ending June 30 is 5.02%. Chandler managed funds yield for the period is 5.07%. Amounts invested with LAIF are liquid; funds can be withdrawn with minimal notice as City operations may require. The rate of return earned by LAIF follows fixed income security rates. Chandler Asset Management manages the balance of the portfolio having a market value of $158,283,000, 65% of the total portfolio. These investments range from one to almost five years to maturity, with the average maturity at 1.96 years (a slightly lower duration than 1.99 years on March 31, 2023). Page 1 City of San Leandro Printed on 12/21/2023