Laserfiche WebLink
CITY OF GEM LAKE, MINNESOTA <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />DECEMBER 31, 2014 <br /> <br /> <br /> <br />(24) <br /> <br />NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) <br />B. Investments <br /> <br />The City may also invest idle funds as authorized by Minnesota Statutes as follows: <br /> <br /> Direct obligations or obligations guaranteed by the United States or its agencies. <br /> Shares of investment companies registered under the Federal Investment <br />Company Act of 1940 and received the highest credit rating, are rated in one of <br />the two highest rating categories by a statistical rating agency and all of the <br />investments have a finial maturity of 13 months or less. <br /> General obligations rated “A” or better; revenue obligations rated “AA” or better. <br /> General obligations of the Minnesota Housing Finance Agency rate “A” or better. <br /> Bankers’ acceptances of United States banks eligible for purchase by the <br />Federal Reserve System. <br /> Commercial paper issued by United States banks corporations or their Canadian <br />subsidiaries, of highest quality category by a least two nationally recognized <br />rating agencies, and maturing in 270 days or less. <br /> Guaranteed investment contracts guaranteed by United States commercial <br />banks or domestic branches of foreign banks or United States insurance <br />companies if similar debt obligations of the issuer or the collateral pledged by the <br />issuer is in the top two rating categories. <br /> Repurchase or reverse purchase agreement and securities lending agreements <br />financial institutions qualified as a “depository” by the government entity, with <br />banks that are members of the Federal Reserve System with capitalization <br />exceeding $10,000,000, a primary reporting dealer in U.S. government securities <br />to the Federal Reserve Bank of New York, or certain Minnesota securities <br />broker-dealers. <br /> Any security which is an obligation of a school district with an original maturity not <br />exceeding 13 months and (i) rated in the highest category by a national bond <br />rating service (ii) enrolled in athe cedit enhancement program pursuant to <br />Minnesota Statute §126C.55 <br /> <br />Custodial Credit Risk <br />For an investment, custodial credit risk is the risk that, in the event of failure of the <br />counterparty, the City will not be able to recover the value of its investment or collateral <br />securities that are in the possession of an outside party. The City’s investment policy <br />doesn’t specifically address custodial credit risk.