Exclusive of accrued interest, deposit investments as at December 31, 2019 was comprised of the following:
| Description | Amount | % |
|---|---|---|
| 10 years, 3.25%, matures August 1, 2027 | $8,318,817 | 51.41% |
| 9 years, 4.0%, matures August 3, 2027 | 2,886,000 | 17.84% |
| 9 years, 3.42%, matures August 3, 2027 | 1,100,000 | 6.80% |
| 8 years, 2.60%, matures August 26, 2027 | 3,875,000 | 23.95% |
| Total Deposit Investments | $16,179.817 | 100.00% |
When compared to the original projections made in 2016, the overall fund is tracking nominally below the projected balance of $16,480,632. This is primarily due to the fact, that the first year’s instalment (2016) was placed in short-term investments and spread amongst various institutions. Those investments were disposed of after one year with the balance then combined with the second instalment and placed on a long-term basis at a more attractive rate. The shortfall, which has been declining each year, of $44,480 is expected to be fully recovered through the course of the 10-year investment term as actual yields to maturity are targeted to exceed the projected yields.
As with any investment decision there is a need to balance risk and return. Higher risk (considered institutional or investment vehicle) investments will typically generate higher rates of return. Longer-term investments will also generate a higher return however the ability to access the funds if needed will be limited thereby creating an element of risk. In regards to this particular portfolio, the requirement to be able to access the funds extends beyond 10 years and therefore longer-term investments are considered more appropriate.
City Treasurer’s Statement of Compliance
All investments comprised within the City’s investment portfolio were made in accordance with the investment policies and goals adopted by the municipality. All investments made during the year were in compliance with the minimum credit rating standards as outlined by the Investment Policy.
Per section 3.2.7 of the Investment Policy, the CFO/City Treasurer is authorized to invest above the recommended maximum thresholds for individual institutions and portfolio sector limitations. Occurrences’ must be reported as part of the annual investment report.
During 2019, funds within the City of Windsor General Investment Portfolio were placed with various institutions which utilized the additional institutional room as authorized by section 3.2.7 of the Investment Policy in order to generate higher investment yields.