CRA LA BUI LDING COMMUNITIES

Transcription

1 CRA LA BUI LDING COMMUNITIES 't n oftbe CITY OF LOS ANGELES nt Agency DATE I 12/05/1 1 I I r:- I.,UllE I 1200 West 7tll Street I Suite 500 Los Angeles Californ ia ,( I F Honorable Council of the City of Los Angeles c/o June A. Lagmay, City Clerk 200 North Spring Street City Hall, Room 395 (Mail Stop 160) Los Angeles, CA RE: CRAILA INVESTMENT REPORT- COUNCIL FILE NO Dear Ms. Lagmay: The CRA/LA's Investment Policy, adopted by the CRAILA Board of Commissioners on June 5, 2008, and approved by the City Council on December 12, 2008, requires that quarterly investment reports be su bmitted to the CRA/LA Board of Commissioners and forwarded to the City Clerk for inclusion in Council File No Accordingly, CRA/LA is forward ing herewith a December 'I, 20 11, Report to CRA/LA Board of Commissioners on CRA/LA Investments as of September 30, Kindly place such report in Council File No Thank you for your attention to this matter. Very truly yours, Christine Essel Chief Executive Officer Attachment

2 -5 REPORT TO CRAJLA BOARD OF COMMISSIONERS ON CRA/LA INVESTMENTS AS OF SEPTEMBER 30, 2011 DECEMBER 1, 2011

3 REPORT ON CRA/LA INVESTMENTS AS OF SEPTEMBER 30, PURPOSE To report investment activities as of September 30, 2011, to the CRA/LA Board of Commissioners, in accordance with the CRAILA's Investment Policy. REPORT The CRA/LA's Investment Policy requires that an Investment Report (Attachment A) be submitted quarterly to the CRAILA Board of Commissioners and forwarded to the City Clerk for inclusion in the respective Council File. The stated objectives of the Investment Policy are safety, liquidity and yield. As of September 30, 2011, the investment portfolio totaled $371,046,733 and had an overall yield of 0.34 percent. Invested funds include unexpended bond proceeds, tax increment revenues, loan proceeds, income from lease and loan payments, interest income and other financial resources which are invested prior to their expenditure consistent with the CRA/LA's adopted annual budget. More than ninety-nine percent (99.97%) of the investment portfolio was comprised of: securities issued by various Federal agencies (51.21%), United States Treasury obligations (27.63%), and investments in the Local Agency Investment Fund managed by the State of California Treasurer's Office (21.13%). The balance of the portfolio was invested in Time Certificates of Deposit (.03%). Attachment B depicts the CRA/LA's investment asset allocation as of September 30, The total cash balance on September 30, 2011, was $97,532,214 consisting primarily of monies in the CRAILA's principal disbursement accounts needed to fund outstanding expenditures, funds pledged to repay certain existing obligations, and funds pending reinvestment. The composition of the investment portfolio continues to reflect a defensive and nimble strategy in light of continuing uncertainties in the financial markets. The overall yield on the investment portfolio at quarter end decreased slightly to 0.34 percent from 0.38 percent on June 30, The current low yields are a result of the investment of new funds and proceeds of maturing "higher yielding" investments in the challenging and persistently low interest rate environment where, for example, the September 30, 2011, annualized yields on six-month and one year U.S. Treasury obligations were 0.06 percent and 0.11 percent, respectively. On April 4, 2011, Fitch Ratings affirmed its ratings of "AAA/V1" on CRA/LA's investment portfolio. These are the highest Fitch ratings achievable. According to Fitch, the "AAA" portfolio credit rating "reflects low vulnerability to losses as a result of defaults." The "V1" portfolio volatility rating reflects "the stability of the portfolio's risk profile, as reflected by the short-dated nature of the invested assets, the high allocation to U.S. Treasury and government agency securities, as well as appropriate levels of liquidity relative to expected cash outflows." In accordance with the Investment Policy, the attached Investment Report summarizes the types of investments held in the CRA/LA's investment portfolio; the institutions holding CRA/LA cash/investment deposits; maturity dates; amounts of deposits; current market value of all securities having a maturity date of more than 12 months; the overall yield on the investment portfolio; a discussion of any unusual investment activity or developments during the reporting period; and a summary of the relevant community involvement/reinvestment activities of banks holding CRA/LA funds (Attachment C).

4 REPORT ON CRA/LA INVESTMENTS AS OF SEPTEMBER 30, Christine Essel Chief Executive Officer By: ~ Deputy Chief Executive Officer Attachment A - Investment Report Attachment B - Investment Asset Allocation Chart Attachment C- Banks Holding CRA/LA Cash I Investments

5 Page 1 of 2 THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF LOS ANGELES INVESTMENT REPORT AS OF SEPTEMBER 30, 2011 DIVERSIFICATION OE INVESTMENTS INVESTMENT MATURITY AVERAGE PERCENTAGE OF TYPE AMOUNT VALUE YIELD(%) PORTFOLIO(%) MATURITY DATES Time Certificates of Deposit $ 100,000 $ 101, /29{13 Federal Agencies Federal Farm Credit Banks $ 22,431,506 $ 22,480, Federal Home Loan Banks 63,999,440 64,073, Federal Home Loan Mtge Corp 64,171,422 64,343, i729 Federal National Mtge Assn 39,432,516 39,558, Total Federal Agencies $ 190,034,884 $ 190,454, /20/12-05/10/13 01/03/12-12/16/13 10/ /29/14 12/06/11-09/12/13 U.S. Treasury Bills $ 40,113,490 $ 40,205, U.S. Treasury Notes 62,401 '138 62,825, Iota! Treasuries $ 102,514,628 $ i03,030, /17/11-05/31/12 11/30/11-11/15/13 Local Agency Investment Fund (LAIF) LAIF Regular $ 50,000,000 $ 50,047, LAIF Bond Proceeds 28,397,221 28,424, Total LAIF $ 78,397,221 $ 78,472, /01/11 10/01/11 TOTALS $ 371,046,733 $ 372,058, ATIACHMENT A

6 THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF LOS ANGELES INVESTMENT ASSET ALLOCATION AS OF SEPTEMBER 30, 2011 LAIF* 21.13% U.S. Treasuries 27.63% Other 0.03% Federal Agency Securities 51.21% *local Agency Investment Fund administered by the State of California ATIACHMENT B

7 THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF LOS ANGELES COMMUNITY INVOLVEMENT/REINVESTMENT ACTIVITIES OF BANKS HOLDING CRA/LA CASH AND INVESTMENTS AS OF SEPTEMBER 30,2011 BANK BANCO POPULAR NORTH AMERICA COMMUNITY INVOLVEMENT I REINVESTMENT ACTIVITIES Provided letters of credit for several Spring Street projects; provided financing for development of a supermarket in Pica Union; maintains banking offices in the City Center, Westlake and Wilshire-Koreatown Redevelopment Projects. BANK OF AMERICA Provided loans to the Beacon Street and Exposition/University Park (formerly Hoover) Redevelopment Projects; maintains offices in several redevelopment project areas; a major source of construction financing for low income rental housing and permanent loans to moderate income homebuyers. CATHAY BANK Minority-owned bank that serves Chinatown and other redevelopment project areas. CENTRAL PACIFIC BANK Provided a $5.3 million loan to the CRA/lA to refinance a loan which provided "start-up" funds for thirteen newly adopted redevelopment project areas. Also provided a $6.1 million loan to CRA/LA for the Marlton Square project in the Crenshaw project area. ONEUNITED BANK Minority-owned financial institution serving the Crenshaw area; served as a mortgage originator and servicer for housing units developed in Monterey Hills. An originator and purchaser of mortgages secured by properties in South Los Angeles. UNION BANK WELLS FARGO BANK Maintains offices in the Bunker Hill, City Center, Little Tokyo and Mid-City Recovery Redevelopment Projects; provided a loan for relocation and other activities in the Los Angeles Harbor Redevelopment Project; successor to Bank of California and Union Bank, which merged. Bank of California provided construction financing for redevelopment activity in the Central Business District Historic Core and for affordable housing development in Little Tokyo. Maintains a banking office in the Broadway-Spring Center; purchased CRA/LA's only Marks Foran rehabilitation bond issue; provided a letter of credit which secured certificates of participation issued for Baldwin Hills Crenshaw Plaza Shopping Center; extremely active in financing very low/low income rehabilitation projects; participates in bridge financing on tax credit projects; made loans to Weingart Center Association, a nonprofit organization which provides significant social, physical, and mental health services to the Skid Row community. ATTACHMENT C