Sarasota County Investment Policy 2018

Sarasota County Investment Policy 9 b. NRSRO Rating Categories The intent of the ratings restriction is to quantify credit risk. Accordingly, all securities purchased by the County must meet the ratings requirement as stipulated by the schedule in Section III, A, 1, a, on the date of purchase. In some instances, an issuer may elect not to have a security rated by an NRSRO. If such security is pari passu with a rated security of the same issuer, the non-rated security may be eligible for purchase utilizing the rating of the pari passu security. In the event a security is rated by multiple NRSROs, with one of those ratings below the specified minimum category rating, it shall not be eligible for purchase, if it was most recently rated by that NRSRO at a higher category. The purpose of this restriction is to allow for purchasing securities of issuers with improving credit fundamentals and eliminate issuers from consideration with declining fundamentals. c. Approved Broker/Dealers It is the policy of Sarasota County to purchase securities from those broker/dealers or banks that have been approved by the Comptroller. Approved broker/dealers and banks will be reviewed, on at least an annual basis, to ensure they meet the evaluation criteria. Firms will be selected at the sole discretion of the Comptroller and evaluated based on the following criteria: i. Banks and savings and loan associations must be a Qualified Public Depository, as determined by the State of Florida and as published in the Florida Administrative Weekly. Other financial institutions may be approved if they have a shareholder’s equity of at least $250 million. For a wholly-owned subsidiary, statements of the parent holding company may be accepted to satisfy the equity requirement. ii. Brokers and dealers must be primary government securities dealers as indicated on the Federal Reserve Bank of New York list. Additionally, those broker/dealers who have a contractual relationship, or previous or current satisfactory fiduciary responsibility with the County in some other capacity. iii. Repurchase Agreements will be conducted only with principals and not through third-party brokers acting as agents. Repurchase Agreements will be in the form specified in Section III, A, 8 of this Policy. iv. Completion of the broker/ dealer application/ questionnaire provided by the Comptroller’s Office. The supervising officer of an approved broker/ dealer will be required to submit a certification document. The document will certify that the officer has reviewed and accepted the investment policy and objectives of the County and further agrees to disclose potential conflicts or risks to County funds that might arise out of business transactions between the firm and the Comptroller’s Office or County. All approved broker/ dealers shall agree to undertake reasonable efforts to preclude imprudent transactions involving County funds. The supervising officer shall agree to exercise due diligence in monitoring the activities of other officers and subordinate staff members engaged in dealings with the Comptroller’s Office.