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selection criteria. A current financial statement of each broker-dealer, institution, consultant • <br /> and/or external money manager which the City is using in execution of this policy must be kept <br /> on file by the Finance Director. Prior to completing an initial transaction with a broker-dealer, the <br /> Finance Director shall provide to the broker-dealer a written statement of investment restrictions <br /> which shall include a provision that all future investments are to be made in accordance with <br /> Minnesota Statutes governing the investment of public funds as well as this statement of <br /> investment policy. The broker-dealer must acknowledge receipt of the statement of investment <br /> restrictions in writing and agree to handle the municipality's account in accordance with these <br /> restrictions. The City may not enter into a transaction with a broker until the broker has provided <br /> this written agreement to the City. <br /> A. Qualified broker-dealers will be those security broker-dealers who maintain an <br /> office in the state and whoa re selected according to credit worthiness and approved <br /> by the Finance Director and the investment advisory committee. Only broker- <br /> dealers who are recognized as "primary dealers" by the Market Reports Division of <br /> the Federal Reserve Bank of New York and/or regional dealers that qualify under <br /> Securities and Exchange Commission Rule 15C=1 (uniform net capital rule) may <br /> be used for City investment placement. <br /> B. Qualified institutions will be those banks, savings banks and saving and loans <br /> institutions which are generally recognized by applicable federal, state and local <br /> statutes as being authorized to receive investments from the City. Approved • <br /> institutions will be those named generally above, whom also meet further selection <br /> criteria developed by the city. Approval is to be determined jointly by the Finance <br /> Director and the investment advisory committee. <br /> C. External consultants may be engaged and used when necessary and prudent to <br /> further a/or enhance the execution of this policy. A consultant is defined for the <br /> purposes of this policy as being an individual or firm having expertise relative to <br /> execution of this policy who may be engaged to serve in and advisory role without <br /> the purpose of receiving investment deposits from the City for the further purpose <br /> of generating a return on the placement. Approval of a consultant must be given <br /> jointly by the Finance Director and the investment advisory committee. No funds <br /> are to be placed directly with a consultant. <br /> D. External money managers may be engaged and used in the execution of this policy <br /> as long as the external money manager(s) is limited to investment activities within <br /> the confines of this policy. An external money manager must maintain appropriate <br /> diversification as noted later in this policy. Any external money manager engaged <br /> by the City will be required to provide an accounting and performance report to <br /> the Finance Director at a frequency not less than quarterly. External money <br /> managers must be approved by the Finance Director and the investment advisory <br /> committee. <br /> • <br /> 6 <br />