02-26-2002 PTRC Packet - Laserfiche WebLink

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Risks and Prudence: • This policy recognizes that risk is inherent in the investment world. Investment risks can result from issuer defaults or market price changes. The Minnesota Statutes governing permissible investments is designed to control risk to some degree. The Treasurer is expected to display prudence in the selection of securities, as a way to minimize default risk. No individual transaction shall be undertaken which jeopardizes the total capital position of the overall portfolio. In the event of a default by a specific issuer, the Treasurer shall review, and if appropriate,proceed to liquidate securities having comparable credit risks. Investment officers acting in accordance with written procedures,the investment policy, and appropriate state regulations shall be relieved of personal responsibility for individual credit risk or market price changes,provided that reasonable action is taken to control adverse developments and all reporting requirements as stated herein are complied with. Ethics and Conflict of Interest: Officers and employees involved in the investment process, or in reviewing same, shall refrain from personal activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees, investment officials, City Council and members of the Finance Committee shall disclose to the City Council any material financial interest in brokerage firms or other financial institutions that conduct business with the City, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the City's portfolio. Employees and officers shall subordinate their personal investment transactions to those of the City, particularly with regard to the time of purchases and sales. Delegation of Authority: Authority to manage the City's investment program is derived from M.S. 412.141. (Treasurer's Duties) and M.S. 471.56 (Municipal Funds). Management responsibility for the investment program is hereby delegated to the Treasurer who shall, on behalf of the City Council, establish written procedures for the operation of the investment program consistent with this investment policy. In the absence of the Treasurer, the City staff so designated in the procedure shall exercise the same authority, with the exception of extending maturities. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Treasurer. 2