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TO: |
Board of Trustees |
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THROUGH: |
Jay Fox, Executive Director |
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FROM: |
Viola Miller, Chief Financial Officer |
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PRESENTER(S): |
Brian Reeves, Associate Chief Financial Officer |
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TITLE:
title
Investment Report - First Quarter 2025
end
AGENDA ITEM TYPE:
Report
RECOMMENDATION:
Informational report for discussion
BACKGROUND:
The Board of Trustees Policy No. 2.1, Financial Management, authorizes the Treasurer to manage the investment of all non-retirement Authority funds in compliance with applicable laws and requires the Chief Financial Officer to prepare and present to the Board a summary of investments, investment activity, and investment performance compared to benchmarks as soon as practical after the end of each calendar quarter. The investment report has been prepared in accordance with the Financial Management Policy and is being presented to the Board.
DISCUSSION:
As of March 31, 2025, the benchmark return (greater of the average return of three-month U.S. Treasury bills or the average return of Federal Funds rate) was 4.33% for the quarter. Investment returns for the State of Utah’s Public Treasurer’s Investment Fund (PTIF) and Zions Corporate Trust was 4.52%, which exceeded the benchmark return. Investment returns for Chandler Asset Management were 4.14% and the overnight account at Zions Bank was 3.80%: these did not exceed the benchmark return.
The blended portfolio return rate for the quarter was 4.29%, which was slightly below the benchmark rate due to long term investment strategy and the increased interest rate environment for the short end of the yield curve.
Note, all returns are reported on an annualized basis.
All investments are in accordance with the Utah State Money Management Act, Section 51, Chapter 7, Utah Code annotated.
ALTERNATIVES:
Utah Transit Authority could increase investments in the Chandler Investment Portfolio and extend the overall duration to potentially seek higher returns. However, that strategy would forego the current advantages of the shorter duration and higher return portfolios like PTIF. Additionally, it would increase the liquidity risk by extending the portfolio duration, which is contrary to the Corporate Policy No. 3.1.4 Investments.
FISCAL IMPACT:
Investment earnings for UTA in the first quarter of 2025 were $4,243,956.
ATTACHMENTS:
Investment Report