Item 6b Supp
Annual Treasury and Investment Portfolio Update for 2008 Commission Briefing Presented by Craig Kerr March 5, 2009 BACKGROUND 12/11/2001 Resolution No. 3476 authorized the Port to become its own Treasurer 6/11/2002 Resolution No. 3487 adopted Port Investment Policy 6/25/2002 Through a Competitive Process, Selected Bank of America as the Port's Bank (On-line banking) 7/31/2002 Port Started Operating its Own Treasury 12/12/2006 Adopted Resolution No. 3569 Revising Port Investment Policy 10/23/2007 Adopted Resolution No. 3589 Amending Section 10 ("Diversification") of the Policy 2 INVESTMENT STRATEGY 2.0 Target Duration Plus or Minus 50 Basis Points Do not forecast rates; balance RETURN and RISK over cycles This strategy outperforms the market when rates are falling and underperforms when rates are rising Benchmark Merrill Lynch Treasury/Agency 3 Year Index 3 PORTFOLIO COMPOSITION "HIGH-GRADE" MORTGAGE- REPURCHASE BACKED AGREEMENTS SECURITIES 3% 8% TREASURY BILLS 17% TREASURY FEDERAL NOTES AGENCIES 7% 53% DISCOUNT NOTES 12% 4 INTEREST RATE TRENDS For 2008, Short and Medium Term Rates Fell and Continue to Fall. The Federal Reserve Lowered Short Term Rates in Quarter 1, 2008 and Continued Lowering 7 Times throughout 2008 (4.25% 0.25%) Staff Monitors Market Conditions; but Does Not Time the Market. Short Term Rates Are Expected to Stay at their present low levels and Medium Term Rates will continue Falling for 2009. 5 2008 R ates 5.0 4.5 4.0 3.5 (% ) 3.0 Y ield 2.5 2.0 1.5 1.0 0.5 0.0 Dec-07 J an-08 F eb-08 Mar-08 Apr-08 May-08 J un-08 J ul-08 Aug-08 S ep-08 Oct-08 Nov-08 Dec-08 F ed F unds 2y Tsy 5y Agy 6 Treas ury Yield C urve 5.0 4.5 4.0 3.5 3.0 Y ield 2.5 2.0 1.5 1.0 0.5 Months 0.0 3 24 60 120 180 360 12/31/2007 12/31/2008 7 Actions Taken In Light of Current Financial Environment Enhanced Commercial Paper Monitoring until Maturity in Early 2008 Did not Invest in any New Commercial Paper from Early 2008 Maturities to Date Re-bid an Investment Agreement to make Allowable Securities More Conservative 8 2008 YIELD COMPARISON Benchmark Port's Pool Q1-2008 1.92% 4.69% Q2-2008 2.79% 4.01% Q3-2008 2.42% 3.93% Q4-2008 0.91% 3.51% ANNUAL 2.01% 4.04% 9 PORTFOLIO YIELD 2004 2008 $45,000,000 4.78% $40,000,000 $35,000,000 4.04% $30,000,000 Interest Earnings 3.57% 3.72% $25,000,000 2.64% Yield $20,000,000 $15,000,000 $10,000,000 $5,000,000 $- 2004 2005 2006 2007 2008 Year 10 YIELD DATA Year Benchmark Port's Pool 2002 2.50% 4.45% 2003 1.58% 4.08% 2004 2.50% 2.64% 2005 4.06% 3.57% 2006 5.00% 3.72% 2007 4.33% 4.78% 2008 2.01% 4.04% Seven Years 3.13% 3.90% 11 Port's Investment Portfolio Size Fluctuates Port's investment portfolio 12/31/2008 was $692 Million Over the past 5 years, the size has ranged from $619 million to $926 million Size fluctuations are mostly tied to capital spending: Capital projects reduce the portfolio size Bond issues to fund projects increase the portfolio 12 PORTFOLIO VALUE 2004 -2008 Par Value (000's) 1,000,000 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 Jan-04 Mar-04 May-04 Jul-04 Sep-04 Nov-04 Jan-05 Mar-05 May-05 Jul-05 Sep-05 Nov-05 Jan-06 Mar-06 May-06 Jul-06 Sep-06 Nov-06 Jan-07 Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 13
Limitations of Translatable Documents
PDF files are created with text and images are placed at an exact position on a page of a fixed size.
Web pages are fluid in nature, and the exact positioning of PDF text creates presentation problems.
PDFs that are full page graphics, or scanned pages are generally unable to be made accessible, In these cases, viewing whatever plain text could be extracted is the only alternative.