Decision details

The Committee considered a review of Treasury Management activities in 2014/15.  Management activities were regulated by the CIPFA Code of Practice and it was best practice to review treasury management activities on a regular basis.

The review included:

·  A review of the economic conditions during 2014/15;

·  Borrowing activity;

·  Investment activity; and

·  Actual results measured against 2014/15 Prudential indicators and Treasury Management Indicators

The following summary of treasury management activities in 2014/15 was presented:

·  The council re-financed £573m of short term borrowing as part of the treasury strategy to take advantage of very low interest rates.

·  Total borrowing at 31 March 2015 was £1.036bn, an increase of £220m from the previous year. This was entirely due to the refinancing of the former Waste PFI contract.

·  Overall the average interest rate paid on borrowing was 2.05% per annum.

·  The total return on the investment portfolios for the 2014/15 financial year was 9.32% on an average investment balance of £864.961m.

·  In total, the capital financing charges showed a surplus in-year of £69m.

·  Credit risk was controlled through only dealing with very high quality investment counterparties. The average credit rating throughout the year has been AA, well above the target A+ rating.

·  Liquidity was a priority for the council to ensure day to day obligations can be met. The council held £107m as cash and cash equivalents on 31 March 2015 along with a further £361m in bonds which were  available for sale at current market prices should further liquidity be required.

·  All Treasury Management activities in year complied with the CIPFA Code of Practice and none of the Prudential Indicators had been breached during the financial year 2014/15.

Resolved: That the review of treasury management activities in 2014/15 be noted.