Decision details

A presentation was made to the committee by Mike Jensen, chief investment officer on a review of the county council's treasury management activities during the third quarter of the 2012/13 financial year and included:

-  A review of the economic conditions and the impact on the county council's borrowing and lending activities.

-  Summaries of borrowing and investment transactions.

-  Monitoring of Prudential Indicators

-  An update on the investment in Landsbanki hf.

Details of the treasury management activities were presented at appendix A. This included details of the current investment policy of accessing high credit quality institutions through bond investments. 

It was reported that the investment portfolio had been divided into sub-portfolios to broadly reflect the County Council's overall cash position and profile of when balances were required.  From this position it was possible to provide geographical and financial sector diversity, whilst increasing liquidity and credit quality management. Inflation and interest rate risk could also be managed and there was a possibility of increased investment returns if suitable opportunities arose.

A table outlining the types of financial instruments to be held within these sub-portfolios and how they were accounted for was included at appendix B.

During discussion, the committee queried whether it was proposed to make any changes to the strategy in order to address the council's future capital requirements. The committee was advised that despite a reduction in the council's grant allocation, other streams of funding were expected to be received in the future which would free up revenue constraints. Following further discussion, it was recommended that the County Treasurer be consulted at an early stage where funding was required for substantial capital projects.

Resolved:   i)  That the update on treasury management activities as shown at appendix A and B to the report now presented, be noted.

  ii)  That the County Treasurer be consulted at an early stage where funding is required for substantial capital projects.