HomeMy WebLinkAboutFY2025 1st Qtr Investment ReportCity of Iowa City
Quarterly
Investment Report
July 1, 2024
to
September 30, 2024
Finance Department
Prepared by:
Emily Droll
Senior Accountant-Revenue
Overview
The City of Iowa City’s investment objectives are safety, liquidity and yield. The primary
objective of the City of Iowa City’s investment activities is the preservation of capital and the
protection of investment principal. The City’s investment portfolio remains sufficiently liquid to
enable the City to meet operating requirements that cash management procedures anticipate.
Investments purchased by the City of Iowa City for the first quarter of this fiscal year had an
average return of 5.019%. The City purchased six new investments in this quarter. The Federal
Funds Rate decreased to 4.83%.
In investing public funds, the City’s cash management portfolio is designed with the objective of
regularly exceeding the average return on the six-month U.S. Treasury Bill. The Treasury Bill is
considered a benchmark for riskless investment transactions and therefore comprises a
minimum standard for the portfolio’s rate of return. Since the city’s investments are mostly
between the six-month and twelve-month range, the yield curve for the twelve-month U.S.
Treasury Bill has been added to the chart. The rolling average return on the six-month U.S.
Treasury Bill for the prior 365 days was 4.38% and the twelve-month return was 4.01%. The
investment program seeks to achieve returns above this threshold, consistent with risk
limitations and prudent investment principles. The rate of return on the City’s entire portfolio for
the quarter was 4.68%.
Investments for this year are $15,237,187 higher than last year. The increase in investments is
due to investing more of the City’s cash on hand as interest rates had been increasing.
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City of Iowa City vs. 6 and 12 Month Treasury Bill
City of Iowa City 6 Month T-bill 12 Month T-bill
Treasury bills and fed funds are competing investments in the money market. The federal funds
rate is highly influential and often has a direct effect on the U.S. economy, because it serves as
a base for interest rates offered by various financial and credit institutions to businesses and
consumers.
The Federal Open Market Committee (FOMC) seeks to achieve maximum employment and
inflation at the rate of 2 percent over the longer run. The Committee has gained greater
confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to
achieving its employment and inflation goals are roughly in balance. The economic outlook is
uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
In light of the progress on inflation and the balance of risks, the Committee decided to lower the
target range for the federal funds rate by 1/2 percentage point to 4-3/4 to 5 percent. In
considering additional adjustments to the target range for the federal funds rate, the Committee
will carefully assess incoming data, the evolving outlook, and the balance of risks. The
Committee will continue reducing its holdings of Treasury securities and agency debt and
agency mortgage-backed securities. The Committee is strongly committed to supporting
maximum employment and returning inflation to its 2 percent objective.
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Federal Funds Rate
9/30/24 9/30/23
Investment Investment Depository
Institution Name Amount Amount Limit
MidwestOne Bank 79,455,802$ 66,296,860$ 150,000,000$
Piper Jaffray & Co.35,999,353$ 58,963,626$ N/A
Iowa Public Agency Investment Trust 32,916,218$ 31,406,500$ N/A
US Bank -$ -$ 65,000,000$
Green State Credit Union 15,000,000$ 15,000,000$ 50,000,000$
Hills Bank & Trust 101,165$ 100,913$ 25,000,000$
Bankers Trust 17,680,643$ 12,725,562$ 50,000,000$
Cedar Rapids Bank and Trust 15,000,000$ -$ 50,000,000$
West Bank 77,115,580$ 73,538,116$ 100,000,000$
Total 273,268,763$ 258,031,576$
City of Iowa City
Investments On Hand
Listing By Institution
MidwestOne Bank
Piper Jaffray & Co.
Iowa Public Agency
Investment Trust
Green State Credit
Union
Hills Bank & Trust
Bankers Trust
Cedar Rapids Bank and TrustWest Bank
City of Iowa City
Investments by Institution
September 30, 2024
9/30/24 9/30/23
Investment Investment
Fund Type Amount Amount
Operating 247,269,410$ 224,032,888$
General Fund Reserve 7,999,353$ 9,998,688$
Equipment Reserve 6,000,000$ 10,000,000$
Health Insurance Reserve 4,000,000$ 6,000,000$
Landfill Replacement Reserve -$ 2,000,000$
Landfill Closure 8,000,000$ 6,000,000$
Water Reserve -$ -$
Total 273,268,763$ 258,031,576$
City of Iowa City
Investments On Hand
Summary By Fund
Operating
General Fund Reserve
Equipment Reserve
Health Insurance
Reserve
Landfill Closure
City of Iowa City
Investments by Fund
September 30, 2024
Fund Investment Purchase Maturity Investment
Institution Type Type Date Date Amount
Investments on Hand at 6/30/24 276,308,972.75$
Purchases
Bankers Trust Operating Money Market 8/31/2024 2,000,000.00
Federal Farm Credit Banks Funding Corp Operating Agency Bond 8/21/2024 8/19/2025 10,000,000.00
GreenState Operating CD 7/31/2024 7/31/2025 5,000,000.00
Midwestone Bank Operating CD 8/23/2024 8/23/2025 5,000,000.00
Midwestone Bank Operating CD 09/16/2024 09/16/2025 5,000,000.00
Midwestone Bank Operating CD 6/28/2024 12/28/2024 5,000,000.00
Midwestone Bank Operating CD 6/28/2024 06/28/2024 5,000,000.00
Interest and Accretion 1,965,898.43
Total Purchases 38,965,898.43
Redemptions
GreenState Operating Time Deposit 7/27/2023 7/29/2024 5,000,000.00
GreenState Operating CD 8/16/2023 8/16/2024 5,000,000.00
GreenState Operating CD 08/16/2023 08/16/2024 5,000,000.00
Midwestone Bank Operating CD 05/03/2024 08/03/2024 10,000,000.00
Midwestone Bank Operating CD 08/23/2023 08/23/2024 5,000,000.00
Midwestone Bank Operating CD 9/14/2023 9/14/2024 5,000,000.00
Federal Home Loan Banks General Fund Reserve Agency Bond 07/22/2021 08/09/2024 2,000,000.00
Midwestone Bank Operating Money Market 07/24/2024 - 5,000,000.00
Expenses 6,108.44
Total Redemptions 42,006,108.44
Investments on Hand at 9/30/24 273,268,762.74$
City of Iowa City
Investment Activity
For The Quarter Ended September 30, 2024
Institution Investment Purchase Maturity Investment
Name Fund Type Date Date Amount
Federal Home Loans Mortgage Co Equipment Replacement Fund Agency Bond 08/19/2020 02/14/2025 2,000,000.00
Federal Farm Credit Banks Funding Corp Equipment Replacement Fund Agency Bond 12/23/2020 12/23/2024 2,000,000.00
Federal Home Loan Banks Equipment Replacement Fund Agency Bond 02/17/2021 02/17/2026 2,000,000.00
Federal Home Loan Banks General Fund Reserve Agency Bond 10/02/2020 09/22/2025 1,999,353.08
Federal Home Loan Banks General Fund Reserve Agency Bond 01/14/2021 01/14/2026 2,000,000.00
Federal Home Loan Banks General Fund Reserve Agency Bond 01/28/2021 01/28/2026 2,000,000.00
Federal Home Loan Banks General Fund Reserve Agency Bond 03/30/2021 03/30/2026 2,000,000.00
Federal Farm Credit Banks Funding Corp Health Insurance Reserve Agency Bond 09/10/2020 09/10/2040 2,000,000.00
Federal Home Loan Banks Health Insurance Reserve Agency Bond 08/23/2021 05/23/2025 2,000,000.00
Federal National Mortgage Association Landfill Closure Fund Agency Bond 12/22/2020 06/22/2029 2,000,000.00
Federal National Mortgage Association Landfill Closure Fund Agency Bond 12/29/2020 12/29/2027 2,000,000.00
Federal Home Loan Banks Landfill Closure Fund Agency Bond 01/29/2021 01/29/2027 2,000,000.00
Federal Home Loan Banks Landfill Closure Fund Agency Bond 01/27/2021 07/27/2026 2,000,000.00
Midwestone Bank Operating Money Mkt --- 09/30/2024 29,455,802.32
Hills Bank Operating Money Mkt --- 09/30/2024 101,165.48
West Bank Operating Money Mkt --- 09/30/2024 77,115,580.41
Bankers Trust Operating Money Mkt --- 09/30/2024 17,680,643.03
IPAIT Operating Money Mkt --- 09/30/2024 22,120,959.74
Cedar Rapids Bank and Trust Company, IA Operating Money Mkt --- 09/30/2024 10,795,258.68
Midwestone Bank Operating CD 10/13/2023 10/13/2024 5,000,000.00
Midwestone Bank Operating CD 01/30/2024 01/30/2025 5,000,000.00
Midwestone Bank Operating CD 04/22/2024 10/22/2024 10,000,000.00
Midwestone Bank Operating CD 04/22/2024 04/22/2025 10,000,000.00
GreenState Operating CD 10/13/2023 10/14/2024 5,000,000.00
Cedar Rapids Bank and Trust Company, IA Operating CD 11/29/2023 11/29/2024 5,000,000.00
Cedar Rapids Bank and Trust Company, IA Operating CD 11/16/2023 11/15/2024 5,000,000.00
Cedar Rapids Bank and Trust Company, IA Operating CD 12/15/2023 11/15/2024 5,000,000.00
GreenState Operating CD 1/24/2024 1/26/2025 5,000,000.00
Federal Farm Credit Banks Funding Corp Operating CD 8/21/2024 8/19/2025 10,000,000.00
GreenState Operating CD 7/31/2024 7/31/2025 5,000,000.00
Midwestone Bank Operating CD 8/23/2024 8/23/2025 5,000,000.00
Midwestone Bank Operating CD 9/16/2024 9/16/2025 5,000,000.00
Midwestone Bank Operating CD 6/28/2024 12/28/2024 5,000,000.00
Midwestone Bank Operating CD 6/28/2024 6/28/2025 5,000,000.00
273,268,762.74$
City of Iowa City
Investments On Hand
September 30, 2024