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HomeMy WebLinkAboutFin City Investment Report 2017.03SAN RAFAEL THE CITY WITH A MISSION Agenda Item No: 4.f Meeting Date: May 15, 2017 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: Finance Department Prepared by: Mark Moses Finance Director City Manager Approval: SUBJECT: QUARTERLY INVESTMENT REPORT RECOMMENDATION: ACCEPT INVESTMENT REPORT FOR THE QUARTER ENDING MARCH 31, 2017, AS PRESENTED BACKGROUND: Pursuant to the State of California Government Code Section 53601 and the City's investment policy, last reviewed and approved by Council on June 20, 2016, staff provides the governing body a report on the City's investment activities. The report outlines the investment activity for the preceding quarter. Included on the report are the cost of each investment, the interest rates (yield), maturity dates, and market value. Separate schedules are prepared for both the City and the Successor Agency to San Rafael Redevelopment Agency. The City invests a portion of its pooled funds in the Local Agency Investment Fund (LAIF), a State run investment pool. Beginning in March 2014, the City incorporated an investment strategy that added purchases of securities outside of LAIF with the assistance of its investment advisor, Insight Investment. ANALYSIS: As of March 31, 2017, the primary LAIF account had a balance of $24,021,598. The other LAIF account containing housing funds for future administrative expenses contained $144,787. Portfolio returns on LAIF deposits were 0.78% for the quarter. The remaining investment assets included the $1,520,800 balance of Pt. San Pedro Assessment District bonds, and $23,033,981 in government agency securities and corporate bonds (including T -Note, John Deere Cap. Corp. Apple Inc. IBM Corp. Pepsico Inc., FNMA). The overall portfolio return for the quarter ended March 31, 2017 was 1.03%. The City's Westamerica account had a balance of $10,188,382.45 at quarter end. Exhibit A is composed of two parts the Quarterly Investment Portfolio Report and Historical Activity By Quarter summarizing the City's investments for the quarter ended December 31, 2017 as well as the three monthly investment reports from Insight Investment. FOR CITY CLERK ONLY File No.: 8-18 x 8-9 Council Meeting: 05/15/2017 Disposition: Accepted report SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 FISCAL IMPACT: No financial impact occurs by adopting the report. The City continues to meet the priority principles of investing - safety, liquidity and yield in respective order. The portfolio remains conservatively invested. Sufficient liquidity exists to meet daily operating and capital project requirements for the next six months. Operating funds, as defined for this report, exclude cash held with fiscal agents for the payment of bond principal and interest. OPTIONS/ACTION REQUIRED: The City Council should adopt the report as presented in order to satisfy current State Investment Code requirements and City policy. ATTACHMENT: Insight Statements January through March 2017 Quarterly Investment Portfolio Report Historical Activity by Quarter Report SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3 I CERTIFY THAT ALL INVESTMENTS MADE ARE IN CONFORMANCE WITH THE CITY'S APPROVED INVESTMENT POLICY AND STATE INVESTMENT REGULATIONS. THE CITY HAS SUFFICIENT LIQUIDITY TO MEET ALL OF THE OBLIGATIONS REQUIRED DURING THE NEXT SIX-MONTH PERIOD. MARK MOSES FINANCE DIRECTOR SAN RAFAEL January 2017 3 A BNY MELLON COMPANY'"^ FOR PROFESSIONAL CLIENTS ONLY NOT TO BE DISTRIBUTED TO RETAIL CLIENTS THIS DOCUMENT SHOULD NOT BE REPRODUCED IN ANY FORM WITHOUT PRIOR WRITTEN APPROVAL Insight INVESTMENT Contents Fixed income market review Activity and performance summary Recap of securities held Maturity distribution of securities held Securities held GASB 40 - Deposit and investment risk disclosure 12 Transaction report 15 Additional information 16 FIXED INCOME MARKET REVIEW As of January 31, 2017 Chart 1: US Gross Domestic Product 12/31/2010-12/31/2016 8.0 - 6.0 - 4.0 - 00 C t 2.0 - T 0.0 -2.0 a -4.0 -6.0 - -8.0 Dec -10 Dec -11 Dec -12 Dec -13 Dec -14 Dec -15 Dec -16 Source: Bloomberg Finance LP, December 31, 2016. Chart 2: Treasury Yield Curves 1/31/2016-1/31/2017 3.00% - SAN RAFAEL Economic Indicators and Monetary Policv On January 4th the Federal Open Market Committee (FOMC) released the minutes from its December 14th meeting. The minutes revealed a general theme of uncertainty regarding the impact of fiscal initiatives proposed by the new White House administration. Despite the uncertainty, a message of confidence came through on the improving labor and economic conditions of the country. On January 6th the Bureau of Labor Statistics reported that the US economy added 156,000 jobs in December, less than the forecast of 175,000 new jobs. The national unemployment rate increased 0.1% to 4.7% and the underemployment rate decreased to 9.2% in December from 9.3% in November. Job growth in 2016 averaged 180,000 jobs per month for over 2.1 million jobs added during the year. Average hourly earnings increased 0.4% in December, reaching a cyclical high. Year -over -year, hourly earnings rose 2.9% in December compared to 2.5% in November. The Producer Price Index (PPI) released January 13th advanced 0.3% including food and energy during December, matching what economists expected for price inflation in the month. Year -over -year, the PPI increased 1.6% for both the headline and core levels. The Consumer Price Index (CPI) released on January 18th also rose 0.3% in December including food and energy, in line with expectations, to an annual rate of 2.1 %. Excluding food and energy, CPI increased 0.2% in December to an annual rate of 2.2%. 2.50% The final estimate of US Gross Domestic Product (GDP) for the fourth quarter of 2016 was released on January 27th. The GDP report showed 1.9% growth in the 2.00% - fourth quarter, a decrease of 1.6% from the third quarter GDP of 3.5% (See Chart 00 1). In the final estimate of fourth quarter GDP, personal consumption decreased 0.5% to an annual rate of 2.5% from the third quarter reading of 3.0%. IU 1.50% - Interest Rate Summary 1.00% - 1 /31 /2017 On January 31st the 3 -month US Treasury bill yielded 0.52%, the 6 -month US 0.50% 1/31/2016 Treasury bill yielded 0.63%, the 2 -year US Treasury note yielded 1.21%, the 5 -year US Treasury note yielded 1.91% and the 10 -year US Treasury note yielded 2.45% 0.00% (See Chart 2). 3 m 6 m 1 yr 2 yr 3 yr 4 yr 5 yr 6 yr 7 yr 8 yr 9 yr 10 yr Source: Bloomberg Finance LP, January3l, 2016, January 31, 2017. ACTIVITY AND PERFORMANCE SUMMARY For the period January 1, 2017 - January 31, 2017 Amortized Cost Basis Activitv Summary Opening balance Income received Total receipts Expenses paid Total disbursements Interportfolio transfers Total Interportfolio transfers Realized gain (loss) Total amortization expense Total OID/MKT accretion income Return of capital Closing balance Ending fair value Unrealized gain (loss) Fed Funds Overnight Repo Merrill Lynch 3m US Treas Bill Merrill Lynch 6m US Treas Bill ML 1 Year US Treasury Note ML 2 Year US Treasury Note ML 5 Year US Treasury Note 24,549,737.57 0.23 17, 978.69 0.24 17, 978.69 0.19 0.43 Cash and Cash Equivalents (143.43) Corporate Bonds (143.43) Government Agencies 0.00 Government Bonds 0.00 Municipal/Provincial Bonds (2,531.98) Total 0.00 13,797.91 (4,535.61) 0.00 800.53 1,924.74 0.00 0.00 24,563,837.75 6,653.50 24,502,731.47 0.00 (61,106.28) 29,442.33 Comparative Rates of Return 1%) * Twelve * Six month trailing month trailing 0.42 0.23 0.46 0.24 0.32 0.19 0.43 0.25 0.64 0.36 0.86 0.48 1.37 0.76 * rates reflected are cumulative SAN RAFAEL Detail of Amortized Cost Basis Return Summary of Amortized Cost Basis Return for the Period Interest Accretion Realized Total earned (amortization) gain (loss) income 3.69 0.00 0.00 3.69 7,062.49 (2,531.98) 0.00 4,530.51 13,797.91 (1,459.19) 0.00 12,338.72 1,924.74 256.09 0.00 2,180.83 6,653.50 0.00 0.00 6,653.50 29,442.33 (3,735.08) 0.00 25,707.25 4 Summary of Amortized Cost Basis Return for the Period * One month Total portfolio 0.06 Interest earned 29,442.33 0.05 Accretion (amortization) (3,735.08) 0.04 Realized gain (loss) on sales 0.00 0.05 Total income on portfolio 25,707.25 0.07 Average daily amortized cost 24,553,409.13 0.10 0.16 Period return 1%) 0.10 YTD return (%) 0.10 Weighted average final maturity in days 788 4 ACTIVITY AND PERFORMANCE SUMMARY For the period January 1, 2017 - January 31, 2017 Fair Value Basis Activitv Summary * Twelve Opening balance 24,469,318.11 Income received 17,978.69 month trailing Total receipts 17,978.69 Expenses paid (143.43) 0.42 Total disbursements (143.43) Interportfolio transfers 0.00 0.46 Total Interportfolio transfers 0.00 Unrealized gain (loss) on security movements 0.00 Return of capital 0.00 Change in fair value for the period 15,578.10 Ending fair value 24,502,731.47 Comparative Rates of Return W * rates reflected are cumulative SAN RAFAEL * Twelve * Six * One month Interest month trailing month trailing 24,585,178.05 Fed Funds 0.42 0.23 0.06 Overnight Repo 0.46 0.24 0.05 Merrill Lynch 3m US Treas Bill 0.37 0.20 0.04 Merrill Lynch 6m US Treas Bill 0.66 0.30 0.07 ML 1 Year US Treasury Note 0.70 0.25 0.14 ML US Treasury 1-3 0.40 (0.36) 0.13 ML US Treasury 1-5 0.17 (1.07) 0.17 * rates reflected are cumulative SAN RAFAEL Summary of Fair Value Basis Return for the Period Total portfolio Interest earned Detail of Fair Value Basis Return Change in fair value 15,578.10 Interest Change in Total 24,585,178.05 earned fair value income Cash and Cash Equivalents 3.69 0.00 3.69 Corporate Bonds 7,062.49 3,170.60 10,233.09 Government Agencies 13,797.91 11,157.00 24,954.91 Government Bonds 1,924.74 1,250.50 3,175.24 Municipal/Provincial Bonds 6,653.50 0.00 6,653.50 Total 29,442.33 15,578.10 45,020.43 Summary of Fair Value Basis Return for the Period Total portfolio Interest earned 29,442.33 Change in fair value 15,578.10 Total income on portfolio 45,020.43 Average daily total value * 24,585,178.05 Period return (%) 0.18 YTD return (%) 0.18 Weighted average final maturity in days 788 * Total value equals market value and accrued interest 5 RECAP OF SECURITIES HELD As of January 31, 2017 Portfolio diversification (%) ■ Cash and Cash Equivalents Historical Amortized Fair value Unrealized Weighted Percent Weighted ■ Municipal/Provincial Bonds cost cost 100.00 gain (loss) average of average final portfolio effective maturity (days) duration (years) Cash and Cash Equivalents 84,926.87 84,926.87 84,926.87 0.00 1 0.34 0.00 Corporate Bonds 4,636,411.50 4,574,143.50 4,560,927.10 (13,216.40) 425 18.82 1.14 Government Agencies 15,396,875.03 15,386,122.30 15,337,346.50 (48,775.80) 517 62.51 1.38 Government Bonds 2,992,460.94 2,997,845.08 2,998,731.00 885.92 272 12.15 0.74 Municipal/Provincial Bonds 1,520,800.00 1,520,800.00 1,520,800.00 0.00 5,693 6.17 10.63 24,631,474.34 1 24,563,837.75 24,502,731.47 0. Portfolio diversification (%) ■ Cash and Cash Equivalents 0.34 ■ Corporate Bonds 18.82 ■ Government Agencies 62.51 ■ Government Bonds 12.15 ■ Municipal/Provincial Bonds 6.17 Total 100.00 SAN RAFAEL 6 MATURITY DISTRIBUTION OF SECURITIES HELD As of January 31, 2017 Maturity Under 90 days 90 to 179 days 180 days to 1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years Over 5 years 8.00 E 6.00 E 0 0 4.00 u 0 x 2.00 KIN Historic cost Percent 2,187,036.87 8.88 2,997,309.06 12.17 6,569,781.88 26.67 6,828,927.25 27.72 3,524,489.28 14.31 1,003,130.00 4.07 0.00 0.00 1,520,800.00 6.17 Maturity distribution J C§l �O SAN RAFAEL 7 SECURITIES HELD SAN RAFAEL As of January 31, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Cash and Cash Equivalents Cash and Cash Equivalents 0.000 84,926.87 84,926.87 84,926.87 84,926.87 0.00 0.00 0.00 0.00 0.34 0.00 0.00 0.00 Total Cash and Cash Equivalents 84,926.87 84,926.87 84,926.87Illllllllllllllllll 84,926.87 0.00 0.00 0.00 0.00 0.34 0.00 0.00 0.00 Corporate Bonds 24422ERN1 1.400 03/15/2017 500,000.00 504,785.00 500,299.06 500,270.00 (29.06) 0.00 583.33 2,644.44 2.05 JOHN DEERE CAPITAL CORP 0.00 (199.38) (227.00) 1.4% 15/03/2017 717081 D.19 1.100 05/15/2017 500,000.00 499,595.00 499,950.78 500,099.25 148.47 0.00 458.33 1,161.11 2.03 PFIZER INC 1.1 % 15/05/2017 0.00 14.06 65.00 459200GJ4 5.700 09/14/2017 500,000.00 568,635.00 513,509.88 514,075.50 565.62 0.00 2,375.00 10,845.83 2.31 IBM CORP 5.7% 14/09/2017 09/13/2017 0.00 (1,809.36) (910.50) 94988J5A1 1.650 01/22/2018 500,000.00 501,930.00 500,969.13 500,725.50 (243.63) 4,125.00 687.50 206.25 2.04 WELLS FARGO BANK NA 1.65% 0.00 (82.60) 739.00 22/01/2018 037833AJ9 1.000 05/03/2018 500,000.00 498,090.00 498,926.51 498,316.00 (610.51) 0.00 416.66 1,222.22 2.02 APPLE INC 1%03/05/2018 0.00 71.09 191.00 084670BX5 1.150 08/15/2018 500,000.00 500,355.00 500,271.76 497,706.00 (2,565.76) 0.00 479.17 2,651.39 2.03 BERKSHIRE HATHAWAY INC 0.00 (14.69) 215.50 1.15% 15/08/2018 25468PDD5 1.500 09/17/2018 550,000.00 555,351.50 554,338.85 550,982.85 (3,356.00) 0.00 687.50 3,070.83 2.25 WALT DISNEY COMPANY/THE 0.00 (221.75) (26.40) 1.5% 17/09/2018 91159HHE3 1.950 11/15/2018 500,000.00 509,425.00 507,431.69 503,021.00 (4,410.69) 0.00 812.50 2,058.33 2.07 US BANCORP 1.95% 10/15/2018 0.00 (345.66) 477.00 15/11/2018 (CALLABLE 15/10/18) 8 SECURITIES HELD As of January 31, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Description Call date shares Accrued interest Accretion Change in fair gain received purchased (amortization) value (loss) Corporate Bonds 149121-6R7 1.350 05/18/2019 500,000.00 498,245.00 498,445.84 495,731.00 (2,714.84) 0.00 CATERPILLAR FINL SERVICE 0.00 56.31 2,647.00 1.35% 18/05/2019 Total Corporate Bonds 4,550,000.00 4,636,411.50 4,574,143.50 4,560,927.10 (13,216.40) 4,125.00 0.00 (2,531.98) 3,170.60 Government Agencies 3137EADC0 1.000 03/08/2017 500,000.00 501,500.00 500,053.62 500,255.00 201.38 0.00 FREDDIE MAC 1% 08/03/2017 0.00 (42.33) (145.50) 3135GOZB2 0.750 04/20/2017 500,000.00 496,725.00 499,762.90 500,224.50 461.60 0.00 FANNIE MAE 0.75%20/04/2017 0.00 88.92 30.00 3133EEX62 0.800 06/16/2017 1,000,000.00 999,770.00 999,956.68 1,000,449.00 492.32 0.00 FEDERAL FARM CREDIT BANK 0.00 9.56 150.00 0.8% 16/06/2017 3137EADV8 0.750 07/14/2017 1,000,000.00 998,530.00 999,678.56 1,000,534.00 855.44 3,750.00 FREDDIE MAC 0.75% 0.00 58.80 369.00 14/07/2017 3136GOZH7 1.050 09/05/2017 1,000,000.00 1,005,150.00 1,001,436.12 1,002,150.00 713.88 0.00 FANNIE MAE 1.05%05/09/2017 0.00 (200.39) 470.00 CALLABLE 313380EC7 0.750 09/08/2017 1,000,000.00 998,790.00 999,643.06 1,000,381.00 737.94 0.00 FEDERAL HOME LOAN BANK 0.00 49.12 873.00 0.75% 08/09/2017 3130A51-56 0.900 10/27/2017 1,000,000.00 999,070.00 999,708.90 1,000,930.00 1,221.10 0.00 FEDERAL HOME LOAN BANK 0.00 32.71 870.00 0.9% 27/10/2017 3130A6D87 0.900 11/20/2017 1,000,000.00 1,000,660.00 1,000,236.00 999,920.00 (316.00) 0.00 FEDERAL HOME LOAN BANK 0.00 (24.42) 830.00 0.9% 2011112017 SAN RAFAEL Interest Total earned accrued Port interest cost 562.50 1,368.75 2.02 7,062.49 25,229.15 18.82 416.67 1,986.11 2.04 312.50 1,052.08 2.02 666.67 1,000.00 4.06 625.00 354.17 4.05 875.00 4,258.33 4.08 625.00 2,979.17 4.05 750.00 2,350.00 4.06 750.00 1,775.00 4.06 9 SECURITIES HELD As of January 31, 2017 SAN RAFAEL Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Government Agencies 313378A43 1.375 03/09/2018 1,000,000.00 1,007,970.00 1,003,419.39 1,004,510.00 1,090.61 0.00 1,145.83 5,423.61 4.09 FEDERAL HOME LOAN BANK 0.00 (257.09) 930.00 1.375% 09/03/2018 3133EGFQ3 0.875 09/14/2018 500,000.00 500,497.00 500,359.22 497,763.00 (2,596.22) 0.00 364.58 1,664.93 2.03 FEDERAL FARM CREDIT BANK 0.00 (18.45) 401.00 0.875% 14/09/2018 3133EGM69 1.100 12/05/2018 1,250,000.00 1,247,248.75 1,247,462.44 1,247,300.00 (162.44) 0.00 1,145.83 2,138.89 5.06 FEDERAL FARM CREDIT BANK 0.00 114.48 1,112.50 1.1% 05/12/2018 3135GOH63 1.375 01/28/2019 1,000,000.00 1,012,490.00 1,010,064.89 1,002,640.00 (7,424.89) 6,875.00 1,145.83 114.58 4.11 FANNIE MAE 1.375% 0.00 (420.54) 1,252.00 28/01/2019 3133782M2 1.500 03/08/2019 1,000,000.00 1,014,124.28 1,011,499.68 1,003,032.00 (8,467.68) 0.00 1,250.00 5,958.33 4.12 FEDERAL HOME LOAN BANK 0.00 (455.13) 17.00 1.5% 08/03/2019 3135GOL76 1.075 07/11/2019 600,000.00 599,100.00 599,214.17 594,564.00 (4,650.17) 3,225.00 537.50 358.33 2.43 FANNIE MAE 1.075% 04/11/2017 0.00 26.76 150.00 11 /07/2019 (CALLABLE 11 /04/17) 3133EGSCO 1.000 08/26/2019 1,000,000.00 1,000,610.00 1,000,521.09 987,130.00 (13,391.09) 0.00 833.34 4,305.56 4.06 FEDERAL FARM CREDIT BANK 0.00 (16.88) 1,320.00 1% 26/08/2019 313380FB8 1.375 09/13/2019 1,000,000.00 1,011,510.00 1,010,181.92 997,974.00 (12,207.92) 0.00 1,145.83 5,270.83 4.11 FEDERAL HOME LOAN BANK 0.00 (323.92) 1,348.00 1.375% 13/09/2019 3133ECEY6 1.450 02/11/2020 1,000,000.00 1,003,130.00 1,002,923.66 997,590.00 (5,333.66) 0.00 1,208.33 6,847.22 4.07 FEDERAL FARM CREDIT BANK 0.00 (80.39) 1,180.00 1.45% 11/02/2020 Total Government Agencies 15,350,000.00 15,396,875.03 15,386,122.30 15,337,346.50 (48,775.80) 13,850.00 13,797.91 47,837.14 62.51 Le 0.00 (1,459.19) 11,157.00 10 SECURITIES HELD As of January 31, 2017 SAN RAFAEL Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total % Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Government Bonds 912828WP1 0.875 06/15/2017 500,000.00 499,414.06 499,912.69 500,508.00 595.31 0.00 372.59 564.90 2.03 USA TREASURY 0.875% 0.00 20.05 (78.00) 15/06/2017 912828TM2 0.625 08/31/2017 1,000,000.00 994,921.88 998,827.28 999,688.00 860.72 0.00 535.23 2,641.58 4.04 USA TREASURY 0.625% 0.00 171.49 469.00 31/08/2017 912828G20 0.875 11/15/2017 500,000.00 500,625.00 500,210.28 500,332.00 121.72 0.00 374.65 930.59 2.03 USA TREASURY 0.875% 0.00 (22.63) 312.50 15/11/2017 912828UR9 0.750 02/28/2018 1,000,000.00 997,500.00 998,894.83 998,203.00 (691.83) 0.00 642.27 3,169.89 4.05 USA TREASURY 0.75% 0.00 87.18 547.00 28/02/2018 3,000,000.00 2,992,460.94 2,997,845.08 2,998,731.00 0.00 0.00 256.09 1,250.50 Municipal/Provincial Bonds 888599LS4 5.250 09/02/2032 1,520,800.00 1,520,800.00 1,520,800.00 1,520,800.00 0.00 0.00 PT. SAN ASSESS DISTRICT 0.00 0.00 0.00 5.25% 144A 02/09/2032 SANRAF$01 Total Municipal/Provincial Bonds 1,520,800.00 1,520,800.00 1,520,800.00 1,520,800.00 0.00 0.00 0.00 0.00 0.00 6,653.50 26,614.00 6.17 6,653.50 26,614.00 6.17 III GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE As of January 31, 2017 SAN RAFAEL Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) Federal Home Loan Banks 313380EC7 FEDERAL HOME LOAN 0.750 09/08/2017 AA+ Aaa 1,000,000.00 998,790.00 4.05 1,000,381.00 4.08 0.59 3130A5L56 FEDERAL HOME LOAN 0.900 10/27/2017 AA+ Aaa 1,000,000.00 999,070.00 4.06 1,000,930.00 4.08 0.73 3130A6D87 FEDERAL HOME LOAN 0.900 11/20/2017 AA+ Aaa 1,000,000.00 1,000,660.00 4.06 999,920.00 4.08 0.79 313378A43 FEDERAL HOME LOAN 1.375 03/09/2018 AA+ Aaa 1,000,000.00 1,007,970.00 4.09 1,004,510.00 4.10 1.08 3133782M2 FEDERAL HOME LOAN 1.500 03/08/2019 AA+ Aaa 1,000,000.00 1,014,124.28 4.12 1,003,032.00 4.09 2.05 313380FB8 FEDERAL HOME LOAN 1.375 09/13/2019 AA+ Aaa 1,000,000.00 1,011,510.00 4.11 997,974.00 4.07 2.55 Issuer total 6,000,000.00 6,032,124.28 24.49 6,006,747.00 24.51 1.30 Federal Farm Credit Banks 3133EEX62 FEDERAL FARM CREDIT 0.800 06/16/2017 AA+ Aaa 1,000,000.00 999,770.00 4.06 1,000,449.00 4.08 0.37 3133EGFQ3 FEDERAL FARM CREDIT 0.875 09/14/2018 AA+ Aaa 500,000.00 500,497.00 2.03 497,763.00 2.03 1.60 3133EGM69 FEDERAL FARM CREDIT 1.100 12/05/2018 AA+ Aaa 1,250,000.00 1,247,248.75 5.06 1,247,300.00 5.09 1.82 3133EGSCO FEDERAL FARM CREDIT 1.000 08/26/2019 AA+ Aaa 1,000,000.00 1,000,610.00 4.06 987,130.00 4.03 2.52 3133ECEY6 FEDERAL FARM CREDIT 1.450 02/11/2020 AA+ Aaa 1,000,000.00 1,003,130.00 4.07 997,590.00 4.07 2.94 Issuer total 4,750,000.00 4,751,255.75 19.29 4,730,232.00 19.30 1.88 Federal National Mortgage Association 3135GOZB2 FANNIE MAE 0.75% 0.750 04/20/2017 AA+ Aaa 500,000.00 496,725.00 2.02 500,224.50 2.04 0.21 3136GOZH7 FANNIE MAE 1.05% 1.050 09/05/2017 AA+ Aaa 1,000,000.00 1,005,150.00 4.08 1,002,150.00 4.09 0.59 3135GOH63 FANNIE MAE 1.375% 1.375 01/28/2019 AA+ Aaa 1,000,000.00 1,012,490.00 4.11 1,002,640.00 4.09 1.96 3135GOL76 FANNIE MAE 1.075% 1.075 07/11/2019 04/11/2017 AA+ Aaa 600,000.00 599,100.00 2.43 594,564.00 2.43 2.06 Issuer total 3,100,000.00 3,113,465.00 12.64 3,099,578.50 12.65 1.26 United States Treasury Note/Bond 912828WP1 USA TREASURY 0.875% 0.875 06/15/2017 AA+ Aaa 500,000.00 499,414.06 2.03 500,508.00 2.04 0.37 912828TM2 USA TREASURY 0.625% 0.625 08/31/2017 AA+ Aaa 1,000,000.00 994,921.88 4.04 999,688.00 4.08 0.57 GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE SAN RAFAEL As of January 31, 2017 Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) United States Treasury Note/Bond 912828G20 USA TREASURY 0.875% 0.875 11/15/2017 AA+ Aaa 500,000.00 500,625.00 2.03 500,332.00 2.04 0.78 912828UR9 USA TREASURY 0.75% 0.750 02/28/2018 AA+ Aaa 1,000,000.00 997,500.00 4.05 998,203.00 4.07 1.06 Issuer total 3,000,000.00 2,992,460.94 12.15 2,998,731.00 12.24 0.74 Pt. San Assess District 888599LS4 PT. SAN ASSESS 5.250 09/02/2032 NR NR 1,520,800.00 1,520,800.00 6.17 1,520,800.00 6.21 10.63 Issuer total 1,520,800.00 1,520,800.00 6.17 1,520,800.00 6.21 10.63 Federal Home Loan Mortgage Corp 3137EADCO FREDDIEMAC1% 1.000 03/08/2017 AA+ Aaa 500,000.00 501,500.00 2.04 500,255.00 2.04 0.10 3137EADV8 FREDDIE MAC 0.75% 0.750 07/14/2017 AA+ Aaa 1,000,000.00 998,530.00 4.05 1,000,534.00 4.08 0.44 Issuer total 1,500,000.00 1,500,030.00 6.09 1,500,789.00 6.12 0.33 Walt Disney Co/The 25468PDD5 WALT DISNEY 1.500 09/17/2018 A A2 550,000.00 555,351.50 2.25 550,982.85 2.25 1.59 Issuer total 550,000.00 555,351.50 2.25 550,982.85 2.25 1.59 International Business Machines Corp 4592000J4 IBM CORP 5.7% 5.700 09/14/2017 09/13/2017 AA- Aa3 500,000.00 568,635.00 2.31 514,075.50 2.10 0.60 Issuer total 500,000.00 568,635.00 2.31 514,075.50 2.10 0.60 US Bancorp 91159HHE3 US BANCORP 1.95% 1.950 11/15/2018 10/15/2018 A+ Al 500,000.00 509,425.00 2.07 503,021.00 2.05 1.71 Issuer total 500,000.00 509,425.00 2.07 503,021.00 2.05 1.71 Wells Fargo Bank NA 94988J5A1 WELLS FARGO BANK NA 1.650 01/22/2018 AA- Aa2 500,000.00 501,930.00 2.04 500,725.50 2.04 0.96 Issuer total 500,000.00 501,930.00 2.04 500,725.50 2.04 0.96 13 GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE SAN RAFAEL As of January 31, 2017 Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) John Deere Capital Corp 24422ERN1 JOHN DEERE CAPITAL 1.400 03/15/2017 A A2 500,000.00 504,785.00 2.05 500,270.00 2.04 0.11 Issuer total 500,000.00 504,785.00 2.05 500,270.00 2.04 0.11 Pfizer Inc 717081 DJ9 PFIZER INC 1.1 % 1.100 05/15/2017 AA Al 500,000.00 499,595.00 2.03 500,099.25 2.04 0.28 Issuer total 500,000.00 499,595.00 2.03 500,099.25 2.04 0.28 Apple Inc 037833AJ9 APPLE INC 1%03/05/2018 1.000 05/03/2018 AA+ Aal 500,000.00 498,090.00 2.02 498,316.00 2.03 1.24 Issuer total 500,000.00 498,090.00 2.02 498,316.00 2.03 1.24 Berkshire Hathaway Inc 0846706x5 BERKSHIRE HATHAWAY 1.150 08/15/2018 AA Aa2 500,000.00 500,355.00 2.03 497,706.00 2.03 1.51 Issuer total 500,000.00 500,355.00 2.03 497,706.00 2.03 1.51 Caterpillar Financial Services Corp 14912L6R7 CATERPILLAR FINL 1.350 05/18/2019 A A3 500,000.00 498,245.00 2.02 495,731.00 2.02 2.25 Issuer total 500,000.00 498,245.00 2.02 495,731.00 2.02 2.25 Cash and Cash Equivalents INVESTED CASH 0.000 84,926.87 84,926.87 0.34 84,926.87 0.35 0.00 Issuer total 84,926.87 84,926.87 0.34 84,926.87 0.35 0.00 24,505,726.87 24,631,474.34 100.00 24,502,731.47 100.00 1.82 14 TRANSACTION REPORT For the period January 1, 2017 - January 31, 2017 Trade date Cusip Transaction Sec type Description Maturity Par value or Realized Settle date 0.00 6,875.00 6,875.00 0.00 3.69 shares gain(loss) 01/11/2017 3135GOL76 Income Government Agencies FAN NIEMAE1.075% 07/11/2019 600,000.00 0.00 01/11/2017 01/14/2017 3137EADV8 Income Government Agencies FREDDIE MAC 0.75% 07/14/2017 1,000,000.00 0.00 0111412017 01/22/2017 94988J5A1 Income Corporate Bonds WELLS FARGO BANK NA 1.65% 01/22/2018 500,000.00 0.00 01/22/2017 01/28/2017 3135GOH63 Income Government Agencies FAN NIEMAE1.375% 01/28/2019 1,000,000.00 0.00 01/28/2017 01/31/2017 Income Cash and Cash Equivalents Cash 0.00 0.00 SAN RAFAEL Principal Interest Transaction total 0.00 3,225.00 3,225.00 0.00 3,750.00 3,750.00 0.00 4,125.00 4,125.00 0.00 6,875.00 6,875.00 0.00 3.69 3.69 15 ADDITIONAL INFORMATION As of January 31, 2017 SAN RAFAEL Past performance is not a guide to future performance. The value of investments and any income from them will fluctuate and is not guaranteed (this may partly be due to exchange rate changes) and investors may not get back the amount invested. Transactions in foreign securities may be executed and settled in local markets. Performance comparisons will be affected by changes in interest rates. Investment returns fluctuate due to changes in market conditions. Investment involves risk, including the possible loss of principal. No assurance can be given that the performance objectives of a given strategy will be achieved. The information contained herein is for your reference only and is being provided in response to your specific request and has been obtained from sources believed to be reliable; however, no representation is made regarding its accuracy or completeness. This document must not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or otherwise not permitted. This document should not be duplicated, amended, or forwarded to a third party without consent from Insight. This is a marketing document intended for professional clients only and should not be made available to or relied upon by retail clients Investment advisory services in North America are provided through four different SEC -registered investment advisers using the brand Insight Investment: Cutwater Asset Management Corp. (CAMC), Cutwater Investor Services Corp. (CISC), Insight North America LLC (INA) and Pareto Investment Management Limited (PIML). The North American investment advisers are associated with a broader group of global investment managers that also (individually and collectively) use the corporate brand Insight Investment and may be referred to as Insight, Insight Group or Insight Investment. Both CISC and CAMC are investment advisers registered with the Securities and Exchange Commission (SEC), under the Investment Advisers Act of 1940, as amended. Registration with the SEC does not imply a certain level of skill or training. You may request, without charge, additional information about Insight. Moreover, specific information relating to Insights strategies, including investment advisory fees, may be obtained from CAMCs and CISCs Forms ADV Part 2A, which are available without charge upon request. Where indicated, performance numbers used in the analysis are gross returns. The performance reflects the reinvestment of all dividends and income. CAMC and CISC charge management fees on all portfolios managed and these fees will reduce the returns on the portfolios. For example, assume that $30 million is invested in an account with either CAMC or CISC, and this account achieves a 5.0% annual return compounded monthly, gross of fees, for a period of five years. At the end of five years that account would have grown to $38,500,760 before the deduction of management fees. Assuming management fees of 0.25% per year are deducted monthly from the account, the value at the end of the five year period would be $38,022,447. Actual fees for new accounts are dependent on size and subject to negotiation. CAMCS and CISC's investment advisory fees are discussed in Part 2A of the Firms Form ADV. Unless otherwise stated, the source of information is Insight. Any forecasts or opinions are Insights own at the date of this document (or as otherwise specified) and may change. Material in this publication is for general information only and is not advice, investment advice, or the recommendation of any purchase or sale of any security. Insight makes no implied or expressed recommendations concerning the manner in which an account should or would be handled, as appropriate investment strategies depend upon specific investment guidelines and objectives and should not be construed to be an assurance that any particular security in a strategy will remain in any fund, account, or strategy, or that a previously held security will not be repurchased. It should not be assumed that any of the security transactions or holdings referenced herein have been or will prove to be profitable or that future investment decisions will be profitable or will equal or exceed the past investment performance of the securities listed. For trading activity the Clearing broker will be reflected. In certain cases the Clearing broker will differ from the Executing broker. In calculating ratings distributions and weighted average portfolio quality, Insight assigns U.S Treasury and U.S agency securities a quality rating based on the methodology used within the respective benchmark index. When Moodys, S&P and Fitch rate a security, Bank of America and Merrill Lynch indexes assign a simple weighted average statistic while Barclays indexes assign the median statistic. Insight assigns all other securities the lower of Moodys and S&P ratings. Information about the indices shown here is provided to allow for comparison of the performance of the strategy to that of certain well-known and widely recognized indices. There is no representation that such index is an appropriate benchmark for such comparison. You cannot invest directly in an index and the indices represented do not take into account trading commissions and/or other brokerage or custodial costs. The volatility of the indices may be materially different from that of the strategy. In addition, the strategys holdings may differ substantially from the securities that comprise the indices shown. The BofA Merrill Lynch 3 Mo US T -Bill index is an unmanaged market index of U.S. Treasury securities maturing in 90 days that assumes reinvestment of all income. The BofA Merrill Lynch 6 Mo US T -Bill index measures the performance of Treasury bills with time to maturity of less than 6 months. The BofA Merrill Lynch Current 1 -Year US Treasury Index is a one -security index comprised of the most recently issued 1 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 1 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch Current 3 -Year US Treasury Index is a one -security index comprised of the most recently issued 3 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 3 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch Current 5 -Year US Treasury Index is a one -security index comprised of the most recently issued 5 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 5 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch 1-3 US Year Treasury Index is an unmanaged index that tracks the performance of the direct sovereign debt of the U.S. Government having a maturity of at least one year and less than three years. The BofA Merrill Lynch 1-5 US Year Treasury Index is an unmanaged index that tracks the performance of the direct sovereign debt of the U.S. Government having a maturity of at least one year and less than five years. Insight does not provide tax or legal advice to its clients and all investors are strongly urged to consult their tax and legal advisors regarding any potential strategy or investment. ADDITIONAL INFORMATION As of January 31, 2017 SAN RAFAEL Insight is a group of wholly owned subsidiaries of The Bank of New York Mellon Corporation. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and may also be used as a generic term to reference the Corporation as a whole or its various subsidiaries generally. Products and services may be provided under various brand names and in various countries by subsidiaries, affiliates and joint ventures of The Bank of New York Mellon Corporation where authorized and regulated as required within each jurisdiction. Unless you are notified to the contrary, the products and services mentioned are not insured by the FDIC (or by any governmental entity) and are not guaranteed by or obligations of The Bank of New York Mellon Corporation or any of its affiliates. The Bank of New York Corporation assumes no responsibility for the accuracy or completeness of the above data and disclaims all expressed or implied warranties in connection therewith. © 2017 Insight Investment. All rights reserved. 17 SAN RAFAEL February 2017 3 A BNY MELLON COMPANY'"^ FOR PROFESSIONAL CLIENTS ONLY NOT TO BE DISTRIBUTED TO RETAIL CLIENTS THIS DOCUMENT SHOULD NOT BE REPRODUCED IN ANY FORM WITHOUT PRIOR WRITTEN APPROVAL Insight INVESTMENT Contents Fixed income market review Activity and performance summary Recap of securities held Maturity distribution of securities held Securities held GASB 40 - Deposit and investment risk disclosure 12 Transaction report 15 Additional information 16 FIXED INCOME MARKET REVIEW As of February 28, 2017 Chart 1: US Consumer Price Index: 1/31/2012-1/31/2017 E911C 3.0 - 2.0 U -' 1.0 Aaa 1.0 Jan -12 Jan -13 Jan -14 Jan -15 Jan -16 Jan -17 CPI CPI Ex Food and Energy Source: Bloomberg Finance LP, February 28, 2017. Chart 2: Treasury Yield Curves: 2/29/2016 and 2/28/2017 3.00% - 2.50% 2.00% 00 IU 1.50% U 1.00% 0.50% - / 2/28/2017 2/29/2016 0.00% 3 m 6 m 1 yr 2 yr 3 yr 4 yr 5 yr 6 yr 7 yr 8 yr 9 yr 10 yr Source: Bloomberg Finance LP, February 29, 2016, February 28, 2017. SAN RAFAEL Economic Indicators and Monetary Policv The Federal Open Market Committee (FOMC) concluded a two-day meeting on February 1 St and voted to maintain the current fed funds target of 0.50%- 0.75%. The assessment of economic conditions reflected moderate economic growth and a strengthening labor market, consistent with prior comments by the FOMC. January's employment report was released on February 3'd and showed US employers added 227,000 workers during the month, in excess of market expectations for 180,000 jobs added. The unemployment rate increased to 4.8% from 4.7% in December and the underemployment rate increased 0.2% to 9.4% in January. The labor force participation rate increased 0.2% in January to 62.9%. Average hourly earnings increased just 0.1% in January for 2.5% growth year - over -year, compared to December's revised annual growth rate of 2.8%. The University of Michigan report on consumer confidence was released on February 10th. The preliminary index of sentiment fell to a three-month low of 95.7 compared to expectations for a reading of 98. Respondents indicated they were better off financially than any other time in the last 12 years and expectations for wage gains deteriorated. On February 14th the Producer Price Index (PPI) for January was released, showing a monthly increase of 0.6% and an annual increase of 1.6%. Excluding food and energy, the PPI increased 0.4% in January and 1.2% on a year -over -year basis. The Consumer Price Index (CPI) was released on February 15th. The headline CPI rose 0.6% in January for an annual increase of 2.5%, excluding food and energy the CPI increased 2.3% on a year -over -year basis and 0.3% in January. (See Chart 1.) Energy price increases in January pushed both the CPI and the PPI higher at the headline level. Gas prices rose 7.8% in the CPI and wholesale energy prices increased 4.7% in the PPI, with gas prices surging 12.9%. Retail sales increased more than expected in January, with the February 15th data release showing a monthly gain of 0.4% compared to expectations of 0.1 %. In addition, December retail sales were revised up to 1.0% from the original reading of 0.6% growth. Interest Rate Summary On February 28th the 3 -month US Treasury bill yielded 0.61%, the 6 -month US Treasury bill yielded 0.74%, the 2 -year US Treasury note yielded 1.26%, the 5 - year US Treasury note yielded 1.93% and the 10 -year US Treasury note yielded 2.39% (See Chart 2). ACTIVITY AND PERFORMANCE SUMMARY For the period February 1, 2017 - February 28, 2017 Amortized Cost Basis Activitv Summary Opening balance Income received Total receipts Expenses paid Total disbursements Interportfolio transfers Total Interportfolio transfers Realized gain (loss) Total amortization expense Total OID/MKT accretion income Return of capital Closing balance Ending fair value Unrealized gain (loss) Fed Funds Overnight Repo Merrill Lynch 3m US Treas Bill Merrill Lynch 6m US Treas Bill ML 1 Year US Treasury Note ML 2 Year US Treasury Note ML 5 Year US Treasury Note 24,563,837.75 * Six 22,008.47 month trailing 22,008.47 Realized 0.44 Cash and Cash Equivalents (143.64) Corporate Bonds (143.64) Government Agencies 0.00 Government Bonds 0.00 Municipal/Provincial Bonds 0.26 Total 0.00 0.37 (4,533.42) 0.90 773.53 0.09 0.00 0.81 24,581,942.69 6,209.93 24,520,156.15 0.00 (61,786.54) 26,731.25 Comparative Rates of Return W * Twelve * Six * One month month trailing month trailing Realized 0.44 0.25 0.05 0.47 0.24 0.04 0.34 0.20 0.04 0.44 0.26 0.05 0.66 0.37 0.06 0.90 0.51 0.09 1.42 0.81 0.14 * rates reflected are cumulative SAN RAFAEL Detail of Amortized Cost Basis Return Interest Accretion Realized Total earned (amortization) gain (loss) income 8.47 0.00 0.00 8.47 6,356.25 (2,531.95) 0.00 3,824.30 12,418.13 (1,459.23) 0.00 10,958.90 1,738.47 231.29 0.00 1,969.76 6,209.93 0.00 0.00 6,209.93 26,731.25 (3,759.89) 0.00 22,971.36 Summary of Amortized Cost Basis Return for the Period Total portfolio Interest earned 26,731.25 Accretion (amortization) (3,759.89) Realized gain (loss) on sales 0.00 Total income on portfolio 22,971.36 Average daily amortized cost 24,568,238.29 Period return (%) 0.09 YTD return (%) 0.20 Weighted average final maturity in days 759 ACTIVITY AND PERFORMANCE SUMMARY For the period February 1, 2017 - February 28, 2017 Fair Value Basis Activitv Summary * Twelve Opening balance 24,502,731.47 Income received 22,008.47 month trailing Total receipts 22,008.47 Expenses paid (143.64) 0.44 Total disbursements (143.64) Interportfolio transfers 0.00 0.47 Total Interportfolio transfers 0.00 Unrealized gain (loss) on security movements 0.00 Return of capital 0.00 Change in fair value for the period (4,440.15) Ending fair value 24,520,156.15 Comparative Rates of Return W * rates reflected are cumulative SAN RAFAEL * Twelve * Six * One month Interest month trailing month trailing 24,621,283.63 Fed Funds 0.44 0.25 0.05 Overnight Repo 0.47 0.24 0.04 Merrill Lynch 3m US Treas Bill 0.39 0.22 0.04 Merrill Lynch 6m US Treas Bill 0.68 0.35 0.06 ML 1 Year US Treasury Note 0.74 0.32 0.06 ML US Treasury 1-3 0.39 (0.09) 0.10 ML US Treasury 1-5 0.08 (0.61) 0.15 * rates reflected are cumulative SAN RAFAEL Summary of Fair Value Basis Return for the Period Total portfolio Interest earned Detail of Fair Value Basis Return Change in fair value (4,440.15) Interest Change in Total 24,621,283.63 earned fair value income Cash and Cash Equivalents 8.47 0.00 8.47 Corporate Bonds 6,356.25 (852.65) 5,503.60 Government Agencies 12,418.13 (3,215.50) 9,202.63 Government Bonds 1,738.47 (372.00) 1,366.47 Municipal/Provincial Bonds 6,209.93 0.00 6,209.93 Total 26,731.25 (4,440.15) 22,291.10 Summary of Fair Value Basis Return for the Period Total portfolio Interest earned 26,731.25 Change in fair value (4,440.15) Total income on portfolio 22,291.10 Average daily total value * 24,621,283.63 Period return (%) 0.09 YTD return (%) 0.27 Weighted average final maturity in days 759 * Total value equals market value and accrued interest 5 RECAP OF SECURITIES HELD As of February 28, 2017 Portfolio diversification (%) ■ Cash and Cash Equivalents Historical Amortized Fair value Unrealized Weighted Percent Weighted ■ Municipal/Provincial Bonds cost cost 100.00 gain (loss) average of average final portfolio effective maturity (days) duration (years) Cash and Cash Equivalents 106,791.70 106,791.70 106,791.70 0.00 1 0.43 0.00 Corporate Bonds 4,636,411.50 4,571,611.55 4,560,074.45 (11,537.10) 397 18.81 1.06 Government Agencies 15,396,875.03 15,384,663.07 15,334,131.00 (50,532.07) 489 62.45 1.30 Government Bonds 2,992,460.94 2,998,076.37 2,998,359.00 282.63 244 12.14 0.66 Municipal/Provincial Bonds 1,520,800.00 1,520,800.00 1,520,800.00 0.00 5,665 6.17 10.55 24,653,339.17 1 24,581,942.69 :. Portfolio diversification (%) ■ Cash and Cash Equivalents 0.43 ■ Corporate Bonds 18.81 ■ Government Agencies 62.45 ■ Government Bonds 12.14 ■ Municipal/Provincial Bonds 6.17 Total 100.00 SAN RAFAEL 6 MATURITY DISTRIBUTION OF SECURITIES HELD As of February 28, 2017 Maturity Under 90 days 90 to 179 days 180 days to 1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years Over 5 years 8.00 E 6.00 E 0 0 4.00 u 0 x 2.00 KIN Maturity distribution J C§l �O Historic cost Percent 2,708,496.70 10.99 2,497,714.06 10.13 6,569,781.88 26.65 6,828,927.25 27.70 4,527,619.28 18.37 0.00 0.00 0.00 0.00 1,520,800.00 6.17 --24,653,339.17 100.00 SAN RAFAEL 7 SECURITIES HELD SAN RAFAEL As of February 28, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Cash and Cash Equivalents Cash and Cash Equivalents 0.000 106,791.70 106,791.70 106,791.70 106,791.70 0.00 0.00 0.00 0.00 0.43 0.00 0.00 0.00 Total Cash and Cash Equivalents 106,791.70 106,791.70 106,791.70 * 106,791.70 0.00 0.00 0.00 0.00 0.43 0.00 0.00 0.00 Corporate Bonds 24422ERN1 1.400 03/15/2017 500,000.00 504,785.00 500,099.69 500,053.00 (46.69) 0.00 525.00 3,169.44 2.05 JOHN DEERE CAPITAL CORP 0.00 (199.37) (217.00) 1.4% 15/03/2017 717081 D.19 1.100 05/15/2017 500,000.00 499,595.00 499,964.84 500,153.00 188.16 0.00 412.50 1,573.61 2.03 PFIZER INC 1.1 % 15/05/2017 0.00 14.06 53.75 459200GJ4 5.700 09/14/2017 500,000.00 568,635.00 511,700.52 512,352.50 651.98 0.00 2,137.50 12,983.33 2.31 IBM CORP 5.7% 14/09/2017 09/13/2017 0.00 (1,809.36) (1,723.00) 94988J5A1 1.650 01/22/2018 500,000.00 501,930.00 500,886.53 500,764.00 (122.53) 0.00 618.75 825.00 2.04 WELLS FARGO BANK NA 1.65% 0.00 (82.60) 38.50 22/01/2018 037833AJ9 1.000 05/03/2018 500,000.00 498,090.00 498,997.61 498,471.50 (526.11) 0.00 375.00 1,597.22 2.02 APPLE INC 1%03/05/2018 0.00 71.10 155.50 084670BX5 1.150 08/15/2018 500,000.00 500,355.00 500,257.07 497,543.50 (2,713.57) 2,875.00 431.25 207.64 2.03 BERKSHIRE HATHAWAY INC 0.00 (14.69) (162.50) 1.15% 15/08/2018 25468PDD5 1.500 09/17/2018 550,000.00 555,351.50 554,117.11 551,253.45 (2,863.66) 0.00 618.75 3,689.58 2.25 WALT DISNEY COMPANY/THE 0.00 (221.74) 270.60 1.5% 17/09/2018 91159HHE3 1.950 11/15/2018 500,000.00 509,425.00 507,086.03 503,704.00 (3,382.03) 0.00 731.25 2,789.58 2.07 US BANCORP 1.95% 10/15/2018 0.00 (345.66) 683.00 15/11/2018 (CALLABLE 15/10/18) 8 SECURITIES HELD As of February 28, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Description Call date shares Accrued interest Accretion Change in fair gain received purchased (amortization) value (loss) Corporate Bonds 149121-6R7 1.350 05/18/2019 500,000.00 498,245.00 498,502.15 495,779.50 (2,722.65) 0.00 CATERPILLAR FINL SERVICE 0.00 56.31 48.50 1.35% 18/05/2019 Total Corporate Bonds 4,550,000.00 4,636,411.50 4,571,611.55 4,560,074.45 (11,537.10) 2,875.00 0.00 (2,515) (852.65) Government Agencies 3137EADC0 1.000 03/08/2017 500,000.00 501,500.00 500,011.29 500,050.50 39.21 0.00 FREDDIE MAC 1% 08/03/2017 0.00 (42.33) (204.50) 3135GOZB2 0.750 04/20/2017 500,000.00 496,725.00 499,851.81 500,137.50 285.69 0.00 FANNIE MAE 0.75%20/04/2017 0.00 88.91 (87.00) 3133EEX62 0.800 06/16/2017 1,000,000.00 999,770.00 999,966.23 1,000,325.00 358.77 0.00 FEDERAL FARM CREDIT BANK 0.00 9.55 (124.00) 0.8% 16/06/2017 3137EADV8 0.750 07/14/2017 1,000,000.00 998,530.00 999,737.36 1,000,285.00 547.64 0.00 FREDDIE MAC 0.75% 0.00 58.80 (249.00) 14/07/2017 3136GOZH7 1.050 09/05/2017 1,000,000.00 1,005,150.00 1,001,235.73 1,001,770.00 534.27 0.00 FANNIE MAE 1.05%05/09/2017 0.00 (200.39) (380.00) CALLABLE 313380EC7 0.750 09/08/2017 1,000,000.00 998,790.00 999,692.18 999,930.00 237.82 0.00 FEDERAL HOME LOAN BANK 0.00 49.12 (451.00) 0.75% 08/09/2017 3130A51-56 0.900 10/27/2017 1,000,000.00 999,070.00 999,741.61 1,000,520.00 778.39 0.00 FEDERAL HOME LOAN BANK 0.00 32.71 (410.00) 0.9% 27/10/2017 3130A6D87 0.900 11/20/2017 1,000,000.00 1,000,660.00 1,000,211.59 999,560.00 (651.59) 0.00 FEDERAL HOME LOAN BANK 0.00 (24.41) (360.00) 0.9% 2011112017 SAN RAFAEL Interest Total earned accrued Port interest cost 506.25 1,875.00 2.02 6,356.25 28,710.40 18.81 375.00 2,361.11 2.03 281.25 1,333.33 2.01 600.00 1,600.00 4.06 562.50 916.67 4.05 787.50 5,045.83 4.08 562.50 3,541.67 4.05 675.00 3,025.00 4.05 675.00 2,450.00 4.06 9 SECURITIES HELD As of February 28, 2017 SAN RAFAEL Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Government Agencies 313378A43 1.375 03/09/2018 1,000,000.00 1,007,970.00 1,003,162.29 1,004,180.00 1,017.71 0.00 1,031.25 6,454.86 4.09 FEDERAL HOME LOAN BANK 0.00 (257.10) (330.00) 1.375% 09/03/2018 3133EGFQ3 0.875 09/14/2018 500,000.00 500,497.00 500,340.76 497,714.50 (2,626.26) 0.00 328.13 1,993.06 2.03 FEDERAL FARM CREDIT BANK 0.00 (18.46) (48.50) 0.875% 14/09/2018 3133EGM69 1.100 12/05/2018 1,250,000.00 1,247,248.75 1,247,576.92 1,246,437.50 (1,139.42) 0.00 1,031.25 3,170.14 5.06 FEDERAL FARM CREDIT BANK 0.00 114.48 (862.50) 1.1% 05/12/2018 3135GOH63 1.375 01/28/2019 1,000,000.00 1,012,490.00 1,009,644.35 1,001,852.00 (7,792.35) 0.00 1,031.25 1,145.83 4.11 FANNIE MAE 1.375% 0.00 (420.54) (788.00) 28/01/2019 3133782M2 1.500 03/08/2019 1,000,000.00 1,014,124.28 1,011,044.55 1,003,226.00 (7,818.55) 0.00 1,125.00 7,083.33 4.11 FEDERAL HOME LOAN BANK 0.00 (455.13) 194.00 1.5% 08/03/2019 3135GOL76 1.075 07/11/2019 600,000.00 599,100.00 599,240.93 594,834.00 (4,406.93) 0.00 483.75 842.08 2.43 FANNIE MAE 1.075% 04/11/2017 0.00 26.76 270.00 11 /07/2019 (CALLABLE 11 /04/17) 3133EGSCO 1.000 08/26/2019 1,000,000.00 1,000,610.00 1,000,504.21 987,540.00 (12,964.21) 5,000.00 750.00 55.56 4.06 FEDERAL FARM CREDIT BANK 0.00 (16.88) 410.00 1% 26/08/2019 313380FB8 1.375 09/13/2019 1,000,000.00 1,011,510.00 1,009,858.00 997,959.00 (11,899.00) 0.00 1,031.25 6,302.08 4.10 FEDERAL HOME LOAN BANK 0.00 (323.92) (15.00) 1.375% 13/09/2019 3133ECEY6 1.450 02/11/2020 1,000,000.00 1,003,130.00 1,002,843.26 997,810.00 (5,033.26) 7,250.00 1,087.50 684.72 4.07 FEDERAL FARM CREDIT BANK 0.00 (80.40) 220.00 1.45% 11/02/2020 Total Government Agencies 15,350,000.00 15,396,875.03 15,384,663.07 15,334,131.00 (50,532.07) 12,250.00 12,418.13 48,005.27 62.45 Le 0.00 (1,459.23) (3,215.50) 10 SECURITIES HELD As of February 28, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Description Call date shares Accrued interest Accretion Change in fair gain received 0.00 4.04 338.40 purchased (amortization) value (loss) 4.05 Government Bonds 2,170.43 12.14 6,209.93 32,823.93 912828WP1 0.875 06/15/2017 500,000.00 499,414.06 499,930.80 500,507.50 576.70 0.00 USA TREASURY 0.875% 0.00 18.11 (0.50) 15/06/2017 912828TM2 0.625 08/31/2017 1,000,000.00 994,921.88 998,982.16 999,531.00 548.84 3,125.00 USA TREASURY 0.625% 0.00 154.88 (157.00) 31/08/2017 912828G20 0.875 11/15/2017 500,000.00 500,625.00 500,189.84 500,312.50 122.66 0.00 USA TREASURY 0.875% 0.00 (20.44) (19.50) 15/11/2017 912828UR9 0.750 02/28/2018 1,000,000.00 997,500.00 998,973.57 998,008.00 (965.57) 3,750.00 USA TREASURY 0.75% 0.00 78.74 (195.00) 28/02/2018 Total Government Bonds 3,000,000.00 2,992,460.94 2,998,076.37 2,998,359.00 282.63 6,875.00 0.00 231.29 (372.00) Municipal/Provincial Bonds 888599LS4 5.250 09/02/2032 1,520,800.00 1,520,800.00 1,520,800.00 1,520,800.00 0.00 0.00 PT. SAN ASSESS DISTRICT 0.00 0.00 0.00 5.25% 144A 02/09/2032 SANRAF$01 Total Municipal/Provincial Bonds III SAN RAFAEL Interest Total % earned accrued Port interest cost 336.54 901.44 2.03 483.42 0.00 4.04 338.40 1,268.99 2.03 580.11 0.00 4.05 1,738.47 2,170.43 12.14 6,209.93 32,823.93 6.17 6,209.93 32,823.93 6.17 III GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE As of February 28, 2017 SAN RAFAEL Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) Federal Home Loan Banks 313380EC7 FEDERAL HOME LOAN 0.750 09/08/2017 AA+ Aaa 1,000,000.00 998,790.00 4.05 999,930.00 4.08 0.52 3130A5L56 FEDERAL HOME LOAN 0.900 10/27/2017 AA+ Aaa 1,000,000.00 999,070.00 4.05 1,000,520.00 4.08 0.65 3130A6D87 FEDERAL HOME LOAN 0.900 11/20/2017 AA+ Aaa 1,000,000.00 1,000,660.00 4.06 999,560.00 4.08 0.72 313378A43 FEDERAL HOME LOAN 1.375 03/09/2018 AA+ Aaa 1,000,000.00 1,007,970.00 4.09 1,004,180.00 4.10 1.01 3133782M2 FEDERAL HOME LOAN 1.500 03/08/2019 AA+ Aaa 1,000,000.00 1,014,124.28 4.11 1,003,226.00 4.09 1.97 313380FB8 FEDERAL HOME LOAN 1.375 09/13/2019 AA+ Aaa 1,000,000.00 1,011,510.00 4.10 997,959.00 4.07 2.47 Issuer total 6,000,000.00 6,032,124.28 24.47 6,005,375.00 24.49 1.23 Federal Farm Credit Banks 3133EEX62 FEDERAL FARM CREDIT 0.800 06/16/2017 AA+ Aaa 1,000,000.00 999,770.00 4.06 1,000,325.00 4.08 0.29 3133EGFQ3 FEDERAL FARM CREDIT 0.875 09/14/2018 AA+ Aaa 500,000.00 500,497.00 2.03 497,714.50 2.03 1.52 3133EGM69 FEDERAL FARM CREDIT 1.100 12/05/2018 AA+ Aaa 1,250,000.00 1,247,248.75 5.06 1,246,437.50 5.08 1.74 3133EGSCO FEDERAL FARM CREDIT 1.000 08/26/2019 AA+ Aaa 1,000,000.00 1,000,610.00 4.06 987,540.00 4.03 2.45 3133ECEY6 FEDERAL FARM CREDIT 1.450 02/11/2020 AA+ Aaa 1,000,000.00 1,003,130.00 4.07 997,810.00 4.07 2.88 Issuer total 4,750,000.00 4,751,255.75 19.27 4,729,827.00 19.29 1.80 Federal National Mortgage Association 3135GOZB2 FANNIE MAE 0.75% 0.750 04/20/2017 AA+ Aaa 500,000.00 496,725.00 2.01 500,137.50 2.04 0.14 3136GOZH7 FANNIE MAE 1.05% 1.050 09/05/2017 AA+ Aaa 1,000,000.00 1,005,150.00 4.08 1,001,770.00 4.09 0.51 3135GOH63 FANNIE MAE 1.375% 1.375 01/28/2019 AA+ Aaa 1,000,000.00 1,012,490.00 4.11 1,001,852.00 4.09 1.88 3135GOL76 FANNIE MAE 1.075% 1.075 07/11/2019 04/11/2017 AA+ Aaa 600,000.00 599,100.00 2.43 594,834.00 2.43 2.04 Issuer total 3,100,000.00 3,113,465.00 12.63 3,098,593.50 12.64 1.19 United States Treasury Note/Bond 912828WP1 USA TREASURY 0.875% 0.875 06/15/2017 AA+ Aaa 500,000.00 499,414.06 2.03 500,507.50 2.04 0.29 912828TM2 USA TREASURY 0.625% 0.625 08/31/2017 AA+ Aaa 1,000,000.00 994,921.88 4.04 999,531.00 4.08 0.50 GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE SAN RAFAEL As of February 28, 2017 Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) United States Treasury Note/Bond 912828G20 USA TREASURY 0.875% 0.875 11/15/2017 AA+ Aaa 500,000.00 500,625.00 2.03 500,312.50 2.04 0.70 912828UR9 USA TREASURY 0.75% 0.750 02/28/2018 AA+ Aaa 1,000,000.00 997,500.00 4.05 998,008.00 4.07 0.99 Issuer total 3,000,000.00 2,992,460.94 12.14 2,998,359.00 12.23 0.66 Pt. San Assess District 888599LS4 PT. SAN ASSESS 5.250 09/02/2032 NR NR 1,520,800.00 1,520,800.00 6.17 1,520,800.00 6.20 10.55 Issuer total 1,520,800.00 1,520,800.00 6.17 1,520,800.00 6.20 10.55 Federal Home Loan Mortgage Corp 3137EADCO FREDDIEMAC1% 1.000 03/08/2017 AA+ Aaa 500,000.00 501,500.00 2.03 500,050.50 2.04 0.02 3137EADV8 FREDDIE MAC 0.75% 0.750 07/14/2017 AA+ Aaa 1,000,000.00 998,530.00 4.05 1,000,285.00 4.08 0.37 Issuer total 1,500,000.00 1,500,030.00 6.08 1,500,335.50 6.12 0.25 Walt Disney Co/The 25468PDD5 WALT DISNEY 1.500 09/17/2018 A A2 550,000.00 555,351.50 2.25 551,253.45 2.25 1.52 Issuer total 550,000.00 555,351.50 2.25 551,253.45 2.25 1.52 International Business Machines Corp 4592000J4 IBM CORP 5.7% 5.700 09/14/2017 09/13/2017 AA- Aa3 500,000.00 568,635.00 2.31 512,352.50 2.09 0.52 Issuer total 500,000.00 568,635.00 2.31 512,352.50 2.09 0.52 US Bancorp 91159HHE3 US BANCORP 1.95% 1.950 11/15/2018 10/15/2018 A+ Al 500,000.00 509,425.00 2.07 503,704.00 2.05 1.63 Issuer total 500,000.00 509,425.00 2.07 503,704.00 2.05 1.63 Wells Fargo Bank NA 94988J5A1 WELLS FARGO BANK NA 1.650 01/22/2018 AA- Aa2 500,000.00 501,930.00 2.04 500,764.00 2.04 0.89 Issuer total 500,000.00 501,930.00 2.04 500,764.00 2.04 0.89 13 GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE SAN RAFAEL As of February 28, 2017 Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) Pfizer Inc 717081 DJ9 PFIZER INC 1.1 % 1.100 05/15/2017 AA Al 500,000.00 499,595.00 2.03 500,153.00 2.04 0.20 Issuer total 500,000.00 499,595.00 2.03 500,153.00 2.04 0.20 John Deere Capital Corp 24422ERN1 JOHN DEERE CAPITAL 1.400 03/15/2017 A A2 500,000.00 504,785.00 2.05 500,053.00 2.04 0.04 Issuer total 500,000.00 504,785.00 2.05 500,053.00 2.04 0.04 Apple Inc 037833AJ9 APPLE INC 1%03/05/2018 1.000 05/03/2018 AA+ Aal 500,000.00 498,090.00 2.02 498,471.50 2.03 1.16 Issuer total 500,000.00 498,090.00 2.02 498,471.50 2.03 1.16 Berkshire Hathaway Inc 0846706x5 BERKSHIRE HATHAWAY 1.150 08/15/2018 AA Aa2 500,000.00 500,355.00 2.03 497,543.50 2.03 1.44 Issuer total 500,000.00 500,355.00 2.03 497,543.50 2.03 1.44 Caterpillar Financial Services Corp 14912L6R7 CATERPILLAR FINL 1.350 05/18/2019 A A3 500,000.00 498,245.00 2.02 495,779.50 2.02 2.18 Issuer total 500,000.00 498,245.00 2.02 495,779.50 2.02 2.18 Cash and Cash Equivalents INVESTED CASH 0.000 106,791.70 106,791.70 0.43 106,791.70 0.44 0.00 Issuer total 106,791.70 106,791.70 0.43 106,791.70 0.44 0.00 14 TRANSACTION REPORT For the period February 1, 2017 - February 28, 2017 Trade date Cusip Transaction Sec type Description Maturity Par value or Realized Settle date 0.00 3,125.00 3,125.00 0.00 3,750.00 shares gain(loss) 02/11/2017 3133ECEY6 Income Government Agencies FEDERAL FARM CREDIT BANK 02/11/2020 1,000,000.00 0.00 02/11/2017 02/15/2017 084670BX5 Income Corporate Bonds BERKSHIRE HATHAWAY INC 08/15/2018 500,000.00 0.00 02/15/2017 02/26/2017 3133EGSCO Income Government Agencies FEDERAL FARM CREDIT BANK 08/26/2019 1,000,000.00 0.00 02/26/2017 02/28/2017 912828TM2 Income Government Bonds USA TREASURY 0.625% 08/31/2017 1,000,000.00 0.00 02/28/2017 02/28/2017 912828UR9 Income Government Bonds USA TREASURY 0.75% 02/28/2018 1,000,000.00 0.00 02/28/2017 02/28/2017 Income Cash and Cash Equivalents Cash 0.00 0.00 SAN RAFAEL Principal Interest Transaction total 0.00 7,250.00 7,250.00 0.00 2,875.00 2,875.00 0.00 5,000.00 5,000.00 0.00 3,125.00 3,125.00 0.00 3,750.00 3,750.00 0.00 8.47 8.47 15 ADDITIONAL INFORMATION As of February 28, 2017 SAN RAFAEL Past performance is not a guide to future performance. The value of investments and any income from them will fluctuate and is not guaranteed (this may partly be due to exchange rate changes) and investors may not get back the amount invested. Transactions in foreign securities may be executed and settled in local markets. Performance comparisons will be affected by changes in interest rates. Investment returns fluctuate due to changes in market conditions. Investment involves risk, including the possible loss of principal. No assurance can be given that the performance objectives of a given strategy will be achieved. The information contained herein is for your reference only and is being provided in response to your specific request and has been obtained from sources believed to be reliable; however, no representation is made regarding its accuracy or completeness. This document must not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or otherwise not permitted. This document should not be duplicated, amended, or forwarded to a third party without consent from Insight. This is a marketing document intended for professional clients only and should not be made available to or relied upon by retail clients Investment advisory services in North America are provided through four different SEC -registered investment advisers using the brand Insight Investment: Cutwater Asset Management Corp. (CAMC), Cutwater Investor Services Corp. (CISC), Insight North America LLC (INA) and Pareto Investment Management Limited (PIML). The North American investment advisers are associated with a broader group of global investment managers that also (individually and collectively) use the corporate brand Insight Investment and may be referred to as Insight, Insight Group or Insight Investment. Both CISC and CAMC are investment advisers registered with the Securities and Exchange Commission (SEC), under the Investment Advisers Act of 1940, as amended. Registration with the SEC does not imply a certain level of skill or training. You may request, without charge, additional information about Insight. Moreover, specific information relating to Insights strategies, including investment advisory fees, may be obtained from CAMCs and CISCs Forms ADV Part 2A, which are available without charge upon request. Where indicated, performance numbers used in the analysis are gross returns. The performance reflects the reinvestment of all dividends and income. CAMC and CISC charge management fees on all portfolios managed and these fees will reduce the returns on the portfolios. For example, assume that $30 million is invested in an account with either CAMC or CISC, and this account achieves a 5.0% annual return compounded monthly, gross of fees, for a period of five years. At the end of five years that account would have grown to $38,500,760 before the deduction of management fees. Assuming management fees of 0.25% per year are deducted monthly from the account, the value at the end of the five year period would be $38,022,447. Actual fees for new accounts are dependent on size and subject to negotiation. CAMCS and CISC's investment advisory fees are discussed in Part 2A of the Firms Form ADV. Unless otherwise stated, the source of information is Insight. Any forecasts or opinions are Insights own at the date of this document (or as otherwise specified) and may change. Material in this publication is for general information only and is not advice, investment advice, or the recommendation of any purchase or sale of any security. Insight makes no implied or expressed recommendations concerning the manner in which an account should or would be handled, as appropriate investment strategies depend upon specific investment guidelines and objectives and should not be construed to be an assurance that any particular security in a strategy will remain in any fund, account, or strategy, or that a previously held security will not be repurchased. It should not be assumed that any of the security transactions or holdings referenced herein have been or will prove to be profitable or that future investment decisions will be profitable or will equal or exceed the past investment performance of the securities listed. For trading activity the Clearing broker will be reflected. In certain cases the Clearing broker will differ from the Executing broker. In calculating ratings distributions and weighted average portfolio quality, Insight assigns U.S Treasury and U.S agency securities a quality rating based on the methodology used within the respective benchmark index. When Moodys, S&P and Fitch rate a security, Bank of America and Merrill Lynch indexes assign a simple weighted average statistic while Barclays indexes assign the median statistic. Insight assigns all other securities the lower of Moodys and S&P ratings. Information about the indices shown here is provided to allow for comparison of the performance of the strategy to that of certain well-known and widely recognized indices. There is no representation that such index is an appropriate benchmark for such comparison. You cannot invest directly in an index and the indices represented do not take into account trading commissions and/or other brokerage or custodial costs. The volatility of the indices may be materially different from that of the strategy. In addition, the strategys holdings may differ substantially from the securities that comprise the indices shown. The BofA Merrill Lynch 3 Mo US T -Bill index is an unmanaged market index of U.S. Treasury securities maturing in 90 days that assumes reinvestment of all income. The BofA Merrill Lynch 6 Mo US T -Bill index measures the performance of Treasury bills with time to maturity of less than 6 months. The BofA Merrill Lynch Current 1 -Year US Treasury Index is a one -security index comprised of the most recently issued 1 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 1 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch Current 3 -Year US Treasury Index is a one -security index comprised of the most recently issued 3 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 3 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch Current 5 -Year US Treasury Index is a one -security index comprised of the most recently issued 5 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 5 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch 1-3 US Year Treasury Index is an unmanaged index that tracks the performance of the direct sovereign debt of the U.S. Government having a maturity of at least one year and less than three years. The BofA Merrill Lynch 1-5 US Year Treasury Index is an unmanaged index that tracks the performance of the direct sovereign debt of the U.S. Government having a maturity of at least one year and less than five years. Insight does not provide tax or legal advice to its clients and all investors are strongly urged to consult their tax and legal advisors regarding any potential strategy or investment. ADDITIONAL INFORMATION As of February 28, 2017 SAN RAFAEL Insight is a group of wholly owned subsidiaries of The Bank of New York Mellon Corporation. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and may also be used as a generic term to reference the Corporation as a whole or its various subsidiaries generally. Products and services may be provided under various brand names and in various countries by subsidiaries, affiliates and joint ventures of The Bank of New York Mellon Corporation where authorized and regulated as required within each jurisdiction. Unless you are notified to the contrary, the products and services mentioned are not insured by the FDIC (or by any governmental entity) and are not guaranteed by or obligations of The Bank of New York Mellon Corporation or any of its affiliates. The Bank of New York Corporation assumes no responsibility for the accuracy or completeness of the above data and disclaims all expressed or implied warranties in connection therewith. © 2017 Insight Investment. All rights reserved. 17 SAN RAFAEL March 2017 3 A BNY MELLON COMPANY'"^ FOR PROFESSIONAL CLIENTS ONLY NOT TO BE DISTRIBUTED TO RETAIL CLIENTS THIS DOCUMENT SHOULD NOT BE REPRODUCED IN ANY FORM WITHOUT PRIOR WRITTEN APPROVAL Insight INVESTMENT Contents Fixed income market review Activity and performance summary Recap of securities held Maturity distribution of securities held Securities held GASB 40 - Deposit and investment risk disclosure 12 Securities purchased 15 Securities sold and matured 16 Transaction report 17 Additional information 18 FIXED INCOME MARKET REVIEW As of March 31, 2017 Chart 1: Fed funds target rate: 3/31/2007-3/31/2017 6.00% - 5.00% 4.00% �°�° 3.00% U DID 2.00% 1.00/ - 0.00% Ma 07Mar-08Mar-09Mar-10Mar-11 Mar -1 2Mar-13Mar-1 4Mar-15Mar-1 6Mar-17 Source: Bloomberg Finance LP, March 31, 2017. Chart 2: Treasury yield curve: 3/31/2016 and 3/31/2017 3.00% - 2.50% - (u2.00% 000 1= u 1.50% a 1.00% - 3/31 /2017 0.50% -3/31/2016 0.00% 3 m 6 m 1 yr 2 yr 3 yr 4 yr 5 yr 6 yr 7 yr 8 yr 9 yr 10 yr Source: Bloomberg Finance LP, March 31, 2017. SAN RAFAEL Economic Indicators and Monetary Policv The meeting of the Federal Open Market Committee (FOMC) concluded on March 15 with the anticipated decision to increase the fed funds target rate 25 basis points. The range for the overnight rate is now 0.75% - 1.00%. The FOMC statement retained language indicating future increases in the fed funds target rate would be "gradual'. (See Chart 1). The payroll report released on March 10, showed US employers added 235,000 jobs in February, better than expectations of 200,000 new jobs. January job growth was revised up to 238,000 from the prior release of 227,000 jobs added. The labor force participation rate rose to 63.0% in February from 62.9% in January. The February unemployment rate decreased to 4.7% from 4.8% in January, and the underemployment rate decreased to 9.2% from 9.4%. Average hourly earnings rose by 0.2% in February to a year -over -year rate of 2.8%. Survey expectations were for wage gains of 0.3% in February. Rising energy prices pushed the headline Producer Price Index (PPI) higher in February. The March 14 release showed February PPI including food and energy increased to 2.2% from 1.6% in January. Excluding food and energy, the core PPI increased 0.3% in February to an annual rate of 1.5%. The Consumer Price Index (CPI) released on March 15° increased to 2.7% in February at the headline level from 2.5% in January, and excluding food and energy the core CPI was 2.2% in February. The final estimate of fourth quarter 2016 GDP was released on March 30. Largely in response to stronger consumer spending, fourth quarter GDP was revised upward to 2.1 from the previous estimate of 1.9% growth. Personal consumption was revised to 3.5% growth in the fourth quarter from the previous estimate of 3.0%. For the third quarter of last year, GDP was 3.5% and personal consumption was 3.0%. Interest Rate Summary On March 31 the 3 -month US Treasury bill yielded 0.75%, the 6 -month US Treasury bill yielded 0.90%, the 2 -year US Treasury note yielded 1.26%, the 5 -year US Treasury note yielded 1.92% and the 10 -year US Treasury note yielded 2.39% (See Chart 2). 3 ACTIVITY AND PERFORMANCE SUMMARY For the period March 1, 2017 - March 31, 2017 Amortized Cost Basis Activitv Summary Opening balance Income received Total receipts Participant withdrawals Expenses paid Total disbursements Interportfolio transfers Total Interportfolio transfers Realized gain (loss) Total amortization expense Total OID/MKT accretion income Return of capital Closing balance Ending fair value Unrealized gain (loss) Fed Funds Overnight Repo Merrill Lynch 3m US Treas Bill Merrill Lynch 6m US Treas Bill ML 1 Year US Treasury Note ML 2 Year US Treasury Note ML 5 Year US Treasury Note 24,581,942.69 92,599.26 * Six 92,599.26 month trailing month trailing Cash and Cash Equivalents (39,921.00) Corporate Bonds (143.75) Government Agencies (40,064.75) Government Bonds 0.00 Municipal/Provincial Bonds 0.06 Total 0.00 0.00 (4,594.55) 800.50 0.00 24,630,683.15 24,554,780.99 (75,902.16) Comnarative Rates of Return W * Twelve * Six * One month month trailing month trailing earned 0.48 0.29 0.07 0.49 0.25 0.06 0.37 0.24 0.06 0.48 0.30 0.07 0.69 0.41 0.09 0.93 0.56 0.11 1.47 0.88 0.17 * rates reflected are cumulative SAN RAFAEL Detail of Amortized Cost Basis Return Interest Accretion Realized Total earned (amortization) gain (loss) income 9.99 0.00 0.00 9.99 7,957.65 (2,584.24) 0.00 5,373.41 14,858.27 (1,428.18) 0.00 13,430.09 2,379.45 218.37 0.00 2,597.82 7,097.07 0.00 0.00 7,097.07 32,302.43 (3,794.05) 0.00 28,508.38 Summary of Amortized Cost Basis Return for the Period Total portfolio Interest earned 32,302.43 Accretion (amortization) (3,794.05) Realized gain (loss) on sales 0.00 Total income on portfolio 28,508.38 Average daily amortized cost 24,614,787.06 Period return (%) 0.12 YTD return (%) 0.31 Weighted average final maturity in days 757 ACTIVITY AND PERFORMANCE SUMMARY For the period March 1, 2017 - March 31, 2017 Fair Value Basis Activitv Summary * Twelve Opening balance 24,520,156.15 Income received 92,599.26 month trailing Total receipts 92,599.26 Participant withdrawals (39,921.00) 0.48 Expenses paid (143.75) 0.07 Total disbursements (40,064.75) Interportfolio transfers 0.00 0.06 Total Interportfolio transfers 0.00 Unrealized gain (loss) on security movements 0.00 Return of capital 0.00 Change in fair value for the period (17,909.67) Ending fair value 24,554,780.99 Comparative Rates of Return W * rates reflected are cumulative SAN RAFAEL * Twelve * Six * One month Interest month trailing month trailing 24,617,646.82 Fed Funds 0.48 0.29 0.07 Overnight Repo 0.49 0.25 0.06 Merrill Lynch 3m US Treas Bill 0.36 0.19 0.02 Merrill Lynch 6m US Treas Bill 0.58 0.26 0.00 ML 1 Year US Treasury Note 0.56 0.21 (0.04) ML US Treasury 1-3 0.25 (0.17) 0.03 ML US Treasury 1-5 (0.10) (0.72) 0.05 * rates reflected are cumulative SAN RAFAEL Summary of Fair Value Basis Return for the Period Total portfolio Interest earned Detail of Fair Value Basis Return Change in fair value (17,909.67) Interest Change in Total 24,617,646.82 earned fair value income Cash and Cash Equivalents 9.99 0.00 9.99 Corporate Bonds 7,957.65 (6,050.70) 1,906.95 Government Agencies 14,858.27 (10,453.00) 4,405.27 Government Bonds 2,379.45 (1,405.97) 973.48 Municipal/Provincial Bonds 7,097.07 0.00 7,097.07 Total 32,302.43 (17,909.67) 14,392.76 Summary of Fair Value Basis Return for the Period Total portfolio Interest earned 32,302.43 Change in fair value (17,909.67) Total income on portfolio 14,392.76 Average daily total value * 24,617,646.82 Period return (%) 0.06 YTD return (%) 0.33 Weighted average final maturity in days 757 * Total value equals market value and accrued interest 5 RECAP OF SECURITIES HELD As of March 31, 2017 Portfolio diversification (%) ■ Cash and Cash Equivalents Historical Amortized Fair value Unrealized Weighted Percent Weighted ■ Municipal/Provincial Bonds cost cost 100.00 gain (loss) average of average final portfolio effective maturity (days) duration (years) Cash and Cash Equivalents 152,565.74 152,565.74 152,565.74 0.00 1 0.62 0.00 Corporate Bonds 4,637,156.50 4,574,557.31 4,559,553.75 (15,003.56) 438 18.77 1.17 Government Agencies 14,895,375.03 14,883,234.89 14,823,678.00 (59,556.89) 474 60.31 1.27 Government Bonds 3,493,691.41 3,499,525.21 3,498,183.50 (1,341.71) 296 14.14 0.80 Municipal/Provincial Bonds 1,520,800.00 1,520,800.00 1,520,800.00 0.00 5,634 6.16 10.74 24,699,588.68 24,630,683.15 24,554,780.99 (75,902.16) 757 1 '010111 Portfolio diversification (%) ■ Cash and Cash Equivalents 0.62 ■ Corporate Bonds 18.77 ■ Government Agencies 60.31 ■ Government Bonds 14.14 ■ Municipal/Provincial Bonds 6.16 Total 100.00 SAN RAFAEL 6 MATURITY DISTRIBUTION OF SECURITIES HELD As of March 31, 2017 Maturity Under 90 days 90 to 179 days 180 days to 1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years Over 5 years 8.00 E 6.00 E 0 0 4.00 u 0 x 2.00 KIN Maturity distribution J C§l �O Historic cost 3,247,169.80 4,566,026.88 5,007,755.00 6,343,111.53 4,014,725.47 0.00 0.00 1,520,800.00 Percent 13.15 18.49 20.28 25.68 16.25 0.00 0.00 6.16 SAN RAFAEL 7 SECURITIES HELD SAN RAFAEL As of March 31, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Cash and Cash Equivalents Cash and Cash Equivalents 0.000 152,565.74 152,565.74 152,565.74 152,565.74 0.00 0.00 0.00 0.00 0.62 0.00 0.00 0.00 Total Cash and Cash Equivalents 152,565.74 152,565.74 152,565.74 152,565.74 0.00 0.00 0.00 0.00 0.62 0.00 0.00 JL- 0.00 Corporate Bonds 717081 DJ9 1.100 05/15/2017 500,000.00 499,595.00 499,978.91 499,893.25 (85.66) 0.00 504.17 2,077.78 2.02 PFIZER INC 1.1 % 15/05/2017 0.00 14.07 (259.75) 459200GJ4 5.700 09/14/2017 500,000.00 568,635.00 509,891.16 510,045.50 154.34 14,250.00 2,612.50 1,345.83 2.30 IBM CORP 5.7% 14/09/2017 09/13/2017 0.00 (1,809.36) (2,307.00) 94988J5A1 1.650 01/22/2018 500,000.00 501,930.00 500,803.94 499,721.00 (1,082.94) 0.00 756.25 1,581.25 2.03 WELLS FARGO BANK NA 1.65% 0.00 (82.59) (1,043.00) 22/01/2018 037833AJ9 1.000 05/03/2018 500,000.00 498,090.00 499,068.70 498,488.00 (580.70) 0.00 458.34 2,055.56 2.02 APPLE INC 1%03/05/2018 0.00 71.09 16.50 084670BX5 1.150 08/15/2018 500,000.00 500,355.00 500,242.38 497,484.00 (2,758.38) 0.00 527.08 734.72 2.03 BERKSHIRE HATHAWAY INC 0.00 (14.69) (59.50) 1.15% 15/08/2018 25468PDD5 1.500 09/17/2018 550,000.00 555,351.50 553,895.36 551,149.50 (2,745.86) 4,125.00 756.25 320.83 2.25 WALT DISNEY COMPANY/THE 0.00 (221.75) (103.95) 1.5% 17/09/2018 91159HHE3 1.950 11/15/2018 500,000.00 509,425.00 506,740.37 502,995.00 (3,745.37) 0.00 893.75 3,683.33 2.06 US BANCORP 1.95% 10/15/2018 0.00 (345.66) (709.00) 15/11/2018 (CALLABLE 15/10/18) 713448CK2 2.250 01/07/2019 500,000.00 505,530.00 505,378.03 505,822.00 443.97 0.00 500.00 2,625.00 2.05 PEPSICO INC 2.25% 07/01/2019 12/07/2018 (2,125.00) (151.97) 292.00 (CALLABLE 07/12/18) 8 SECURITIES HELD As of March 31, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Description Call date shares Accrued interest Accretion Change in fair gain received purchased (amortization) value (loss) Corporate Bonds 149121-6R7 1.350 05/18/2019 500,000.00 498,245.00 498,558.46 493,955.50 (4,602.96) 0.00 CATERPILLAR FINL SERVICE 0.00 56.31 (1,824.00) 1.35% 18/05/2019 Total Corporate Bonds 4,550,000.00 4,637,156.50 4,574,557.31 4,559,553.75 (15,003.56) 18,375.00 (2,125.00) (2,484.55) (5,997.70) Government Agencies 3135GOZB2 0.750 04/20/2017 500,000.00 496,725.00 499,940.72 499,989.00 48.28 0.00 FANNIE MAE 0.75%20/04/2017 0.00 88.91 (148.50) 3133EEX62 0.800 06/16/2017 1,000,000.00 999,770.00 999,975.79 999,879.00 (96.79) 0.00 FEDERAL FARM CREDIT BANK 0.00 9.56 (446.00) 0.8% 16/06/2017 3137EADV8 0.750 07/14/2017 1,000,000.00 998,530.00 999,796.16 999,631.00 (165.16) 0.00 FREDDIE MAC 0.75% 0.00 58.80 (654.00) 14/07/2017 3136GOZH7 1.050 09/05/2017 1,000,000.00 1,005,150.00 1,001,035.34 1,000,810.00 (225.34) 5,250.00 FANNIE MAE 1.05%05/09/2017 0.00 (200.39) (960.00) CALLABLE 313380EC7 0.750 09/08/2017 1,000,000.00 998,790.00 999,741.30 999,100.00 (641.30) 3,750.00 FEDERAL HOME LOAN BANK 0.00 49.12 (830.00) 0.75% 08/09/2017 3130A51-56 0.900 10/27/2017 1,000,000.00 999,070.00 999,774.31 999,410.00 (364.31) 0.00 FEDERAL HOME LOAN BANK 0.00 32.70 (1,110.00) 0.9% 27/10/2017 3130A6D87 0.900 11/20/2017 1,000,000.00 1,000,660.00 1,000,187.18 999,300.00 (887.18) 0.00 FEDERAL HOME LOAN BANK 0.00 (24.41) (260.00) 0.9% 2011112017 313378A43 1.375 03/09/2018 1,000,000.00 1,007,970.00 1,002,905.19 1,002,294.00 (611.19) 6,875.00 FEDERAL HOME LOAN BANK 0.00 (257.10) (1,886.00) 1.375% 09/03/2018 SAN RAFAEL Interest Total earned accrued Port interest cost 618.75 2,493.75 2.02 7,627.09 16,918.05 18.77 343.75 1,677.08 2.01 733.33 2,333.33 4.05 687.50 1,604.17 4.04 962.50 758.33 4.07 687.50 479.17 4.04 825.00 3,850.00 4.04 825.00 3,275.00 4.05 1,260.42 840.28 4.08 9 SECURITIES HELD SAN RAFAEL As of March 31, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Government Agencies 3133EGFQ3 0.875 09/14/2018 500,000.00 500,497.00 500,322.31 497,648.00 (2,674.31) 2,187.50 401.04 206.60 2.03 FEDERAL FARM CREDIT BANK 0.00 (18.45) (66.50) 0.875% 14/09/2018 3133EGM69 1.100 12/05/2018 1,250,000.00 1,247,248.75 1,247,691.39 1,246,750.00 (941.39) 0.00 1,260.42 4,430.56 5.05 FEDERAL FARM CREDIT BANK 0.00 114.47 312.50 1.1% 05/12/2018 3135GOH63 1.375 01/28/2019 1,000,000.00 1,012,490.00 1,009,223.82 1,001,140.00 (8,083.82) 0.00 1,260.42 2,406.25 4.10 FANNIE MAE 1.375% 0.00 (420.53) (712.00) 28/01/2019 3133782M2 1.500 03/08/2019 1,000,000.00 1,014,124.28 1,010,589.42 1,002,641.00 (7,948.42) 7,500.00 1,375.00 958.33 4.11 FEDERAL HOME LOAN BANK 0.00 (455.13) (585.00) 1.5% 08/03/2019 3135GOL76 1.075 07/11/2019 600,000.00 599,100.00 599,267.69 594,396.00 (4,871.69) 0.00 591.25 1,433.33 2.43 FANNIE MAE 1.075% 04/11/2017 0.00 26.76 (438.00) 1110712019 (CALLABLE 11/07/17) 3133EGSC0 1.000 08/26/2019 1,000,000.00 1,000,610.00 1,000,487.32 986,250.00 (14,237.32) 0.00 916.66 972.22 4.05 FEDERAL FARM CREDIT BANK 0.00 (16.89) (1,290.00) 1% 26/08/2019 313380FB8 1.375 09/13/2019 1,000,000.00 1,011,510.00 1,009,534.08 996,770.00 (12,764.08) 6,875.00 1,260.42 687.50 4.10 FEDERAL HOME LOAN BANK 0.00 (323.92) (1,189.00) 1.375% 13/09/2019 3133ECEY6 1.450 02/11/2020 1,000,000.00 1,003,130.00 1,002,762.87 997,670.00 (5,092.87) 0.00 1,329.17 2,013.89 4.06 FEDERAL FARM CREDIT BANK 0.00 (80.39) (140.00) 1.45% 11/02/2020 Total Government Agencie 14,850,000.00 14,895,375.03 14,883,234.89 14,823,678.00 (59,556.89) 32,437.50 14,719.38 27,926.04 60.31 0.00 (1,416.89) (10,402.50) 10 SECURITIES HELD SAN RAFAEL As of March 31, 2017 Cusip/ Coupon Maturity/ Par value or Historical cost/ Amortized cost/ Fair value/ Unrealized Interest Interest Total % Description Call date shares Accrued interest Accretion Change in fair gain received earned accrued Port purchased (amortization) value (loss) interest cost Government Bonds 912828WP1 0.875 06/15/2017 500,000.00 499,414.06 499,950.85 500,078.00 127.15 0.00 372.60 1,274.04 2.02 USA TREASURY 0.875% 0.00 20.05 (429.50) 15/06/2017 912828TM2 0.625 08/31/2017 1,000,000.00 994,921.88 999,153.65 998,984.00 (169.65) 0.00 526.50 526.50 4.03 USA TREASURY 0.625% 0.00 171.49 (547.00) 3110812017 912828G20 0.875 11/15/2017 500,000.00 500,625.00 500,167.20 499,765.50 (401.70) 0.00 374.66 1,643.65 2.03 USA TREASURY 0.875% 0.00 (22.64) (547.00) 15/11/2017 912828UR9 0.750 02/28/2018 1,000,000.00 997,500.00 999,060.74 997,188.00 (1,872.74) 0.00 631.79 631.79 4.04 USA TREASURY 0.75% 0.00 87.17 (820.00) 28/02/2018 912828WLO 1.500 05/31/2019 500,000.00 501,230.47 501,192.77 502,168.00 975.23 0.00 473.90 2,493.13 2.03 USA TREASURY 1.5% (2,019.23) (37.70) 937.53 31/05/2019 Total Government Bonds 3,500,000.00 3,493,691.41 3,499,525.21 3,498,183.50 (1,341.71) 0.00 2,379.45 6,569.11 14.14 s Municipal/Provincial Bonds 888599LS4 5.250 09/02/2032 PT. SAN ASSESS DISTRICT 5.25% 144A 02/09/2032 SANRAF$01 Total Municipal/Provincial Bonds (2,019.23) 218.37 (1,405.97) AM 1,520,800.00 1,520,800.00 1,520,800.00 1,520,800.00 0.00 39,921.00 7,097.07 0.00 6.16 0.00 0.00 0.00 1,520,800.00 1,520,800.00 1,520,800. 1,520,800.00 0.00 39,921.00 7,097.07 0.00 6.16 0.00 0.00 0.00 III GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE As of March 31, 2017 SAN RAFAEL Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) Federal Home Loan Banks 313380EC7 FEDERAL HOME LOAN 0.750 09/08/2017 AA+ Aaa 1,000,000.00 998,790.00 4.04 999,100.00 4.07 0.44 3130A5L56 FEDERAL HOME LOAN 0.900 10/27/2017 AA+ Aaa 1,000,000.00 999,070.00 4.04 999,410.00 4.07 0.57 3130A6D87 FEDERAL HOME LOAN 0.900 11/20/2017 AA+ Aaa 1,000,000.00 1,000,660.00 4.05 999,300.00 4.07 0.63 313378A43 FEDERAL HOME LOAN 1.375 03/09/2018 AA+ Aaa 1,000,000.00 1,007,970.00 4.08 1,002,294.00 4.08 0.93 3133782M2 FEDERAL HOME LOAN 1.500 03/08/2019 AA+ Aaa 1,000,000.00 1,014,124.28 4.11 1,002,641.00 4.08 1.90 313380FB8 FEDERAL HOME LOAN 1.375 09/13/2019 AA+ Aaa 1,000,000.00 1,011,510.00 4.10 996,770.00 4.06 2.41 Issuer total 6,000,000.00 6,032,124.28 24.42 5,999,515.00 24.43 1.15 Federal Farm Credit Banks 3133EEX62 FEDERAL FARM CREDIT 0.800 06/16/2017 AA+ Aaa 1,000,000.00 999,770.00 4.05 999,879.00 4.07 0.21 3133EGFQ3 FEDERAL FARM CREDIT 0.875 09/14/2018 AA+ Aaa 500,000.00 500,497.00 2.03 497,648.00 2.03 1.44 3133EGM69 FEDERAL FARM CREDIT 1.100 12/05/2018 AA+ Aaa 1,250,000.00 1,247,248.75 5.05 1,246,750.00 5.08 1.65 3133EGSCO FEDERAL FARM CREDIT 1.000 08/26/2019 AA+ Aaa 1,000,000.00 1,000,610.00 4.05 986,250.00 4.02 2.37 3133ECEY6 FEDERAL FARM CREDIT 1.450 02/11/2020 AA+ Aaa 1,000,000.00 1,003,130.00 4.06 997,670.00 4.06 2.80 Issuer total 4,750,000.00 4,751,255.75 19.24 4,728,197.00 19.26 1.72 United States Treasury Note/Bond 912828WP1 USA TREASURY 0.875% 0.875 06/15/2017 AA+ Aaa 500,000.00 499,414.06 2.02 500,078.00 2.04 0.20 912828TM2 USA TREASURY 0.625% 0.625 08/31/2017 AA+ Aaa 1,000,000.00 994,921.88 4.03 998,984.00 4.07 0.41 912828620 USA TREASURY 0.875% 0.875 11/15/2017 AA+ Aaa 500,000.00 500,625.00 2.03 499,765.50 2.04 0.62 912828UR9 USA TREASURY 0.75% 0.750 02/28/2018 AA+ Aaa 1,000,000.00 997,500.00 4.04 997,188.00 4.06 0.91 912828WLO USA TREASURY 1.5% 1.500 05/31/2019 AA+ Aaa 500,000.00 501,230.47 2.03 502,168.00 2.05 2.12 Issuer total 3,500,000.00 3,493,691.41 14.14 3,498,183.50 14.25 0.80 Federal National Mortgage Association 3135GOZB2 FANNIE MAE 0.75% 0.750 04/20/2017 AA+ Aaa 500,000.00 496,725.00 2.01 499,989.00 2.04 0.05 GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE SAN RAFAEL As of March 31, 2017 Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) Federal National Mortgage Association 3137EADV8 FREDDIE MAC 0.75% 0.750 07/14/2017 3136GOZH7 FANNIE MAE 1.05% 1.050 09/05/2017 AA+ Aaa 1,000,000.00 1,005,150.00 4.07 1,000,810.00 4.08 0.43 3135GOH63 FANNIE MAE 1.375% 1.375 01/28/2019 AA+ Aaa 1,000,000.00 1,012,490.00 4.10 1,001,140.00 4.08 1.80 3135GOL76 FANNIE MAE 1.075% 1.075 07/11/2019 04/11/2017 AA+ Aaa 600,000.00 599,100.00 2.43 594,396.00 2.42 2.01 Issuer total 2.25 551,149.50 2.24 1.44 3,100,000.00 3,113,465.00 12.61 3,096,335.00 12.61 1.12 Pt. San Assess District 888599LS4 PT. SAN ASSESS 5.250 09/02/2032 NR NR 1,520,800.00 1,520,800.00 6.16 1,520,800.00 6.19 10.74 Issuer total 1,520,800.00 1,520,800.00 6.16 1,520,800.00 6.19 10.74 Federal Home Loan Mortgage Corp 3137EADV8 FREDDIE MAC 0.75% 0.750 07/14/2017 AA+ Aaa 1,000,000.00 998,530.00 4.04 999,631.00 4.07 0.28 Issuer total 1,000,000.00 998,530.00 4.04 999,631.00 4.07 0.28 Walt Disney Co/The 25468PDD5 WALT DISNEY 1.500 09/17/2018 A A2 550,000.00 555,351.50 2.25 551,149.50 2.24 1.44 Issuer total 550,000.00 555,351.50 2.25 551,149.50 2.24 1.44 International Business Machines Corp 459200GJ4 IBM CORP 5.7% 5.700 09/14/2017 09/13/2017 AA- Aa3 500,000.00 568,635.00 2.30 510,045.50 2.08 0.45 Issuer total 500,000.00 568,635.00 2.30 510,045.50 2.08 0.45 PepsiCo Inc 713448CK2 PEPSICOINC2.25% 2.250 01/07/2019 12/07/2018 A Al 500,000.00 505,530.00 2.05 505,822.00 2.06 1.68 Issuer total 500,000.00 505,530.00 2.05 505,822.00 2.06 1.68 US Bancorp 91159HHE3 US BANCORP 1.95% 1.950 11/15/2018 10/15/2018 A+ Al 500,000.00 509,425.00 2.06 502,995.00 2.05 1.55 Issuer total 500,000.00 509,425.00 2.06 502,995.00 2.05 1.55 13 GASB 40 - DEPOSIT AND INVESTMENT RISK DISCLOSURE SAN RAFAEL As of March 31, 2017 Cusip Description Coupon Maturity Call date 5&P Moody Par value or Historical % Portfolio Market % Portfolio Effective date rating rating shares cost hist cost value mkt value dur (yrs) Pfizer Inc 717081 DJ9 PFIZER INC 1.1 % 1.100 05/15/2017 AA Al 500,000.00 499,595.00 2.02 499,893.25 2.04 0.12 Issuer total 500,000.00 499,595.00 2.02 499,893.25 2.04 0.12 Wells Fargo Bank NA 94988J5A1 WELLS FARGO BANK NA 1.650 01/22/2018 AA- Aa2 500,000.00 501,930.00 2.03 499,721.00 2.04 0.80 Issuer total 500,000.00 501,930.00 2.03 499,721.00 2.04 0.80 Apple Inc 037833AJ9 APPLE INC 1%03/05/2018 1.000 05/03/2018 AA+ Aal 500,000.00 498,090.00 2.02 498,488.00 2.03 1.07 Issuer total 500,000.00 498,090.00 2.02 498,488.00 2.03 1.07 Berkshire Hathaway Inc 0846706x5 BERKSHIRE HATHAWAY 1.150 08/15/2018 AA Aa2 500,000.00 500,355.00 2.03 497,484.00 2.03 1.36 Issuer total 500,000.00 500,355.00 2.03 497,484.00 2.03 1.36 Caterpillar Financial Services Corp 14912L6R7 CATERPILLAR FINL 1.350 05/18/2019 A A3 500,000.00 498,245.00 2.02 493,955.50 2.01 2.09 Issuer total 500,000.00 498,245.00 2.02 493,955.50 2.01 2.09 Cash and Cash Equivalents INVESTED CASH 0.000 152,565.74 152,565.74 0.62 152,565.74 0.62 0.00 Issuer total 152,565.74 152,565.74 0.62 152,565.74 0.62 0.00 14 SECURITIES PURCHASED For the period March 1, 2017 - March 31, 2017 Cusip / Description / Broker Trade date Settle date Corporate Bonds 713448CK2 03/13/2017 PEPSICO INC 2.25%07/01/2019 (CALLABLE 07/12/18) 03/15/2017 MORGAN STANLEY AND CO., LLC Total Corporate Bonds j Government Bonds 912828W LO 03/06/2017 USA TREASURY 1.5% 31/05/2019 03/08/2017 CREDIT AGRICOLE CIB Total Government Bonds Grand total SAN RAFAEL Coupon Maturity/ Par value or Unit cost Principal Accrued Call date shares cost interest purchased 2.250 01/07/2019 500,000.00 101.11 (505,530.00) (2,125.00) 12/07/2018 500,000.00 (505,530.00) (2,125.00) 1.500 05/31/2019 500,000.00 100.25 (501,230.47) (2,019.23) 500,000.00 (501,230.47) (2,019.23) 15 SECURITIES SOLD AND MATURED SAN RAFAEL For the period March 1, 2017 - March 31, 2017 Cusip/ Trade date Coupon Maturity/ Par value or Historical cost Amortized cost Price Fair value at Realized Accrued Interest Interest Description/ Settle date Call date shares at sale or maturity sale or maturity / gain interest received earned Broker /Accr (amort) Chg.in fair value (loss) sold Corporate Bonds 24422ERN1 03/15/2017 1.400 (500,000.00) 504,785.00 500,000.00 0.00 500,000.00 0.00 0.00 3,500.00 330.56 JOHN DEERE CAPITAL CORP 03/15/2017 (99.69) (53.00) TRANCHE # TR 00373 1.4 DUE 03-15-2017 Total (Corporate Bonds) (500,000.00) 504,785.00 500,000.00 500,000.00 0.00 0.00 3,500.00 330.56 (99.69) (53.00) Government Agencies 3137EADCO 03/08/2017 1.000 FEDERAL HOME LN MTG 03/08/2017 CORP 1 DUE 03-08-2017 Total (Government Agencies) (500,000.00) 501,500.00 500,000.00 (11.29) (500,000.00) 501,500.00 500,000.00 (11.29) 0.00 500,000.00 (50.50) 500,000.00 (50.50) 0.00 0.00 2,500.00 138.89 0.00 0.00 2,500.00 138.89 16 TRANSACTION REPORT SAN RAFAEL For the period March 1, 2017 - March 31, 2017 Trade date Cusip Transaction Sec type Description Maturity Par value or Realized Principal Interest Transaction total Settle date shares gain(loss) 03/05/2017 3136GOZH7 Income Government Agencies FANNIE MAE 1.05% 05/09/2017 09/05/2017 1,000,000.00 0.00 0.00 5,250.00 5,250.00 03/05/2017 03/06/2017 912828WLO Bought Government Bonds USA TREASURY 1.5% 05/31/2019 500,000.00 0.00 (501,230.47) (2,019.23) (503,249.70) 03/08/2017 03/08/2017 3133782M2 Income Government Agencies FEDERAL HOME LOAN BANK 03/08/2019 1,000,000.00 0.00 0.00 7,500.00 7,500.00 03/08/2017 03/08/2017 313380EC7 Income Government Agencies FEDERAL HOME LOAN BANK 09/08/2017 1,000,000.00 0.00 0.00 3,750.00 3,750.00 03/08/2017 03/08/2017 3137EADCO Income Government Agencies FEDERAL HOME LN MTG CORP 03/08/2017 500,000.00 0.00 0.00 2,500.00 2,500.00 03/08/2017 03/08/2017 3137EADCO Capital Change Government Agencies FEDERAL HOME LN MTG CORP 03/08/2017 (500,000.00) 0.00 500,000.00 0.00 500,000.00 03/08/2017 03/09/2017 313378A43 Income Government Agencies FEDERAL HOME LOAN BANK 03/09/2018 1,000,000.00 0.00 0.00 6,875.00 6,875.00 03/09/2017 03/13/2017 313380FB8 Income Government Agencies FEDERAL HOME LOAN BANK 09/13/2019 1,000,000.00 0.00 0.00 6,875.00 6,875.00 03/13/2017 03/13/2017 713448CK2 Bought Corporate Bonds PEPSICO INC 2.25% 07/01/2019 01/07/2019 500,000.00 0.00 (505,530.00) (2,125.00) (507,655.00) 03/15/2017 03/14/2017 3133EGFQ3 Income Government Agencies FEDERAL FARM CREDIT BANK 09/14/2018 500,000.00 0.00 0.00 2,187.50 2,187.50 03/14/2017 03/14/2017 459200GJ4 Income Corporate Bonds IBM CORP 5.7% 14/09/2017 09/14/2017 500,000.00 0.00 0.00 14,250.00 14,250.00 03/14/2017 03/15/2017 24422ERN1 Income Corporate Bonds JOHN DEERE CAPITAL CORP 03/15/2017 500,000.00 0.00 0.00 3,500.00 3,500.00 03/15/2017 03/15/2017 24422ERN1 Capital Change Corporate Bonds JOHN DEERE CAPITAL CORP 03/15/2017 (500,000.00) 0.00 500,000.00 0.00 500,000.00 03/15/2017 03/17/2017 25468PDD5 Income Corporate Bonds WALT DISNEY COMPANY/THE 09/17/2018 550,000.00 0.00 0.00 4,125.00 4,125.00 03/17/2017 03/31/2017 888599LS4 Income Municipal/Provincial Bonds PT. SAN ASSESS DISTRICT 09/02/2032 1,520,800.00 0.00 0.00 39,921.00 39,921.00 03/31/2017 03/31/2017 Income Cash and Cash Equivalents Cash 0.00 0.00 0.00 9.99 9.99 17 ADDITIONAL INFORMATION As of March 31, 2017 SAN RAFAEL Past performance is not a guide to future performance. The value of investments and any income from them will fluctuate and is not guaranteed (this may partly be due to exchange rate changes) and investors may not get back the amount invested. Transactions in foreign securities may be executed and settled in local markets. Performance comparisons will be affected by changes in interest rates. Investment returns fluctuate due to changes in market conditions. Investment involves risk, including the possible loss of principal. No assurance can be given that the performance objectives of a given strategy will be achieved. The information contained herein is for your reference only and is being provided in response to your specific request and has been obtained from sources believed to be reliable; however, no representation is made regarding its accuracy or completeness. This document must not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or otherwise not permitted. This document should not be duplicated, amended, or forwarded to a third party without consent from Insight. This is a marketing document intended for professional clients only and should not be made available to or relied upon by retail clients Investment advisory services in North America are provided through four different SEC -registered investment advisers using the brand Insight Investment: Cutwater Asset Management Corp. (CAMC), Cutwater Investor Services Corp. (CISC), Insight North America LLC (INA) and Pareto Investment Management Limited (PIML). The North American investment advisers are associated with a broader group of global investment managers that also (individually and collectively) use the corporate brand Insight Investment and may be referred to as Insight, Insight Group or Insight Investment. Both CISC and CAMC are investment advisers registered with the Securities and Exchange Commission (SEC), under the Investment Advisers Act of 1940, as amended. Registration with the SEC does not imply a certain level of skill or training. You may request, without charge, additional information about Insight. Moreover, specific information relating to Insights strategies, including investment advisory fees, may be obtained from CAMCs and CISCs Forms ADV Part 2A, which are available without charge upon request. Where indicated, performance numbers used in the analysis are gross returns. The performance reflects the reinvestment of all dividends and income. CAMC and CISC charge management fees on all portfolios managed and these fees will reduce the returns on the portfolios. For example, assume that $30 million is invested in an account with either CAMC or CISC, and this account achieves a 5.0% annual return compounded monthly, gross of fees, for a period of five years. At the end of five years that account would have grown to $38,500,760 before the deduction of management fees. Assuming management fees of 0.25% per year are deducted monthly from the account, the value at the end of the five year period would be $38,022,447. Actual fees for new accounts are dependent on size and subject to negotiation. CAMCS and CISC's investment advisory fees are discussed in Part 2A of the Firms Form ADV. Unless otherwise stated, the source of information is Insight. Any forecasts or opinions are Insights own at the date of this document (or as otherwise specified) and may change. Material in this publication is for general information only and is not advice, investment advice, or the recommendation of any purchase or sale of any security. Insight makes no implied or expressed recommendations concerning the manner in which an account should or would be handled, as appropriate investment strategies depend upon specific investment guidelines and objectives and should not be construed to be an assurance that any particular security in a strategy will remain in any fund, account, or strategy, or that a previously held security will not be repurchased. It should not be assumed that any of the security transactions or holdings referenced herein have been or will prove to be profitable or that future investment decisions will be profitable or will equal or exceed the past investment performance of the securities listed. For trading activity the Clearing broker will be reflected. In certain cases the Clearing broker will differ from the Executing broker. In calculating ratings distributions and weighted average portfolio quality, Insight assigns U.S Treasury and U.S agency securities a quality rating based on the methodology used within the respective benchmark index. When Moodys, S&P and Fitch rate a security, Bank of America and Merrill Lynch indexes assign a simple weighted average statistic while Barclays indexes assign the median statistic. Insight assigns all other securities the lower of Moodys and S&P ratings. Information about the indices shown here is provided to allow for comparison of the performance of the strategy to that of certain well-known and widely recognized indices. There is no representation that such index is an appropriate benchmark for such comparison. You cannot invest directly in an index and the indices represented do not take into account trading commissions and/or other brokerage or custodial costs. The volatility of the indices may be materially different from that of the strategy. In addition, the strategys holdings may differ substantially from the securities that comprise the indices shown. The BofA Merrill Lynch 3 Mo US T -Bill index is an unmanaged market index of U.S. Treasury securities maturing in 90 days that assumes reinvestment of all income. The BofA Merrill Lynch 6 Mo US T -Bill index measures the performance of Treasury bills with time to maturity of less than 6 months. The BofA Merrill Lynch Current 1 -Year US Treasury Index is a one -security index comprised of the most recently issued 1 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 1 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch Current 3 -Year US Treasury Index is a one -security index comprised of the most recently issued 3 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 3 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch Current 5 -Year US Treasury Index is a one -security index comprised of the most recently issued 5 -year US Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 5 -year note must be auctioned on or before the third business day before the last business day of the month. The BofA Merrill Lynch 1-3 US Year Treasury Index is an unmanaged index that tracks the performance of the direct sovereign debt of the U.S. Government having a maturity of at least one year and less than three years. The BofA Merrill Lynch 1-5 US Year Treasury Index is an unmanaged index that tracks the performance of the direct sovereign debt of the U.S. Government having a maturity of at least one year and less than five years. Insight does not provide tax or legal advice to its clients and all investors are strongly urged to consult their tax and legal advisors regarding any potential strategy or investment. ADDITIONAL INFORMATION As of March 31, 2017 SAN RAFAEL Insight is a group of wholly owned subsidiaries of The Bank of New York Mellon Corporation. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and may also be used as a generic term to reference the Corporation as a whole or its various subsidiaries generally. Products and services may be provided under various brand names and in various countries by subsidiaries, affiliates and joint ventures of The Bank of New York Mellon Corporation where authorized and regulated as required within each jurisdiction. Unless you are notified to the contrary, the products and services mentioned are not insured by the FDIC (or by any governmental entity) and are not guaranteed by or obligations of The Bank of New York Mellon Corporation or any of its affiliates. The Bank of New York Corporation assumes no responsibility for the accuracy or completeness of the above data and disclaims all expressed or implied warranties in connection therewith. © 2017 Insight Investment. All rights reserved. 19 City of Rafael Quarterly Investment Portfolio Report March 31, 2017 LAIF $ 24,021,598 99.4% 0.78% LAIF - Housing $ 144,787 0.6% 0.78% Total Internally Managed $ 24,166,385 49.6% Weighted Average Yield 0.78% Days Effective Average Duration - Internal 1 LAIF, 99.4% Weighted Average Maturity - Internal 1 Cash $ 152,566 0.6% 0.00% Treasury Securities $ 3,498,184 14.2% 0.93% Corporate Notes, 18.6% Instrumentality Securities $ 14,823,678 60.4% 0.96% Corporate Notes $ 4,559,554 18.6% 1.26% Municipal $ 1,520,800 6.2% 5.25% Total Externally Managed $ 24,554,781 50.4% Weighted Average Yield 1.27% Years Instrumentality Effective Average Duration - External 1.76 Securities, Weighted Average Maturity - External 2.07 60.4% LAIF Cash Treasury Securities Instrumentality Securities Corporate Notes Municipal Total Portfolio Assets Weighted Average Yield $ 24,166,385 49.6% 0.78% $ 152,566 0.3% 0.00% $ 3,498,184 7.2% 0.93% $ 14,823,678 30.4% 0.96% $ 4,559,554 9.4% 1.26% $ 1,520,800 3.1% 5.25% $ 48,721,166 Effective Average Duration - Total Weighted Average Maturity - Total Based on Market Values 1.03% Years 0.89 1.04 Instrumenta Securities 31% LAIF - Hrnitina_ Cash, 0.6%— Treasury Securities, 14.2% Corporate Notes 9% Treasury Securities Cash 7% 0% Municipal 3% LAIF 50% Exhibit A City of San Rafael Historical Activity -By Quarter March 31, 2017 Internally Managed Assets % Return December 31, 2016 % Return September 30, 2016 % Return % June 30, 2016 % Return March 31, 2016 % Return LAIF $ 24,021,598 99.4% 0.78% $ 15,987,701 99.1% 0.72% $ 24,669,361 99.4% 0.61% $ 23,953,234 99.4% 0.58% $ 28,170,969 99.5% 0.47% LAIF- Housing $ 144,787 0.6% 0.78% $ 144,541 0.9% 0.72% $ 144,126 0.6% 0.61% $ 144,126 0.6% 0.58% $ 143,959 0.5% 0.47% Total Internally Managed $ 24,166,385 49.6% $ 16,132,242 39.7% $ 24,813,487 50.3% $ 24,097,360 51.6% $ 28,314,928 55.6% Weighted Average Yield Effective Average Duration - Internal Weighted Average Maturity- Internal Externally Managed Assets $ 24,166,385 % 0.78% Days 1 1 Return 16,132,242 % 0.72% Days 1 1 Return 50.3% % 0.61% Days 1 1 Return 51.6% % 0.58% Days 1 1 Return 55.6% % 0.47% Days 1 1 Return Cash $ 152,566 0.6% 0.00% $ 67,092 0.3% 0.00% $ 24,880 0.1% 0.00% $ 110,082 0.5% 0.00% $ 73,758 0.3% 0.00% Commercial Paper $ 3,498,184 14.2% 0.93% $ - 0.0% 0.00% $ - 0.0% 0.00% $ 499,703 2.2% 0.82% $ 498,681 2.2% 0.82% Treasury Securities $ 14,823,678 60.4% 0.96% $ 2,997,481 12.2% 0.85% $ 5,254,701 21.4% 0.80% $ 6,261,745 27.7% 0.76% $ 6,255,351 27.7% 0.76% Instrumentality Securities $ 4,559,554 18.6% 1.26% $ 15,326,190 62.6% 0.96% $ 13,150,097 53.6% 0.91% $ 10,634,528 47.0% 0.86% $ 10,622,440 47.0% 0.84% Corporate Notes $ 1,520,800 6.2% 5.25% $ 4,557,757 18.6% 1.18% $ 4,584,779 18.7% 0.87% $ 3,541,815 15.7% 1.07% $ 3,553,197 15.7% 1.07% Municipal $ 24,554,781 50.4% $ 1,520,800 6.2% 5.25% $ 1,520,800 6.2% 5.25% $ 1,582,700 7.0% 5.25% $ 1,582,700 7.0% 5.25% Total Externally Managed $ $ 24,469,318 60.3% $ 24,535,257 49.7% $ 22,630,572 48.4% $ 22,586,127 44.4% Weighted Average Yield Weighted Average Yield 1.03% 1.27% 1.04% 1.25% 0.88% 1.15% 0.86% 1.15% 0.77% 1.14% Years Years Years Years Years Years Years Years Years Years Effective Average Duration - External 0.89 1.76 1.15 1.91 1.43 1.87 1.32 1.66 1.38 1.86 Weighted Average Maturity - External 1.04 2.07 1.36 2.25 1.61 2.22 1.51 2.06 1.55 2.25 LAIF $ 24,166,385 49.6% 0.78% $ 16,132,242 39.7% 0.72% $ 24,813,487 50.3% 0.61% $ 24,097,360 51.6% 0.58% $ 28,314,928 55.6% 0.47% Cash $ 152,566 0.3% 0.00% $ 67,092 0.2% 0.00% $ 24,880 0.1% 0.00% $ 110,082 0.2% 0.00% $ 73,758 0.1% 0.00% Commercial Paper $ 3,498,184 7.2% 0.93% $ - 0.0% 0.00% $ - 0.0% 0.00% $ 499,703 1.1% 0.82% $ 498,681 1.0% 0.82% Treasury Securities $ 14,823,678 30.4% 0.96% $ 2,997,481 7.4% 0.85% $ 5,254,701 10.6% 0.82% $ 6,261,745 13.4% 0.76% $ 6,255,351 12.3% 0.76% Instrumentality Securities $ 4,559,554 9.4% 1.26% $ 15,326,190 37.7% 0.96% $ 13,150,097 26.6% 0.91% $ 10,634,528 22.8% 0.86% $ 10,622,440 20.9% 0.84% Corporate Notes $ 1,520,800 3.1% 5.25% $ 4,557,757 11.2% 1.18% $ 4,584,779 9.3% 0.87% $ 3,541,815 7.6% 1.07% $ 3,553,197 7.0% 1.07% Municipal $ 48,721,166 $ 1,520,800 3.7% 5.25% $ 1,520,800 3.1% 5.25% $ 1,582,700 3.4% 5.25% $ 1,582,700 3.1% 5.25% Total Portfolio Assets $ 40,601,560 $ 49,348,744 $ 46,727,932 $ 50,901,055 Weighted Average Yield 1.03% 1.04% 0.88% 0.86% 0.77% Years Years Years Years Years Effective Average Duration - Total 0.89 1.15 1.43 1.32 1.38 Weighted Average Maturity - Total 1.04 1.36 1.61 1.51 1.55 Performance Recap -The weighted average quarterly portfolio yield decreased slightly from 1.04% to 1.03% during the past quarter. The yield has increased over the past year, from .77% in the quarter ended Mar 31, 2015 to 1.03% in the most recent quarter. -This trend is reflective of the general increase in interest rates that occurred througout the year. -The effective average duration has dropped, from 1.15 to .89 years as the City shortens its investments in preparation for drawing on funds accumulated for the San Rafael Essential Facilities Project. -The total portfolio assets increased by approximately $8 million during the quarter. This is due to the collection of property tax received in late December that were invested in January 2017. W:\Accounting and Budgeting\Finance\Bank Reconciliations\Statements\16-17\March 2017\Quarterly Report combined.xlsx ROUTING SLIP / APPROVAL FORM INSTRUCTIONS: Use this cover sheet with each submittal of a staff report before approval by the City Council. Save staff report (including this cover sheet) along with all related attachments in the Team Drive (T:) --> CITY COUNCIL AGENDA ITEMS 4 AGENDA ITEM APPROVAL PROCESS 4 [DEPT - AGENDA TOPIC] Agenda Item # Date of Meeting: 5/15/2017 From: Mark Moses/Van Bach Department: Finance Date: 5/15/2017 Topic: CITY -QUARTERLY INVESTMENT REPORT Subject: CITY -QUARTERLY INVESTMENT REPORT Type: ❑ Resolution ❑ Ordinance ❑ Professional Services Agreement ❑ Other: APPROVALS ® Finance Director Remarks: Approved ® City Attorney Remarks: LG -Approved 5/5/17. ® Author, review and accept City Attorney / Finance changes Remarks: Approved ® City Manager Remarks: