Page 445 - FortWorthFY22AdoptedBudget

11. Domestic or international equity and preferred stock mutual funds with a
Morningstar rating of at least two stars if available. If a fund is less than three
years old and lacks a Morningstar rating, that fund may be selected only if it has
been recommended by an investment management firm under contract as
Trustee of the Permanent Fund.

12. US or international stocks.

13. Real assets, including real estate, commodities and real estate investment trusts
(REITS).

14. Alternative Investments to include hedge funds.

15. Corporate and asset backed securities rated A, or better with a stated maturity
not to exceed ten (10) years.

Securities Lending

If the City has an active securities lending agreement, the Permanent Fund securities
may also be lent by Trustee utilizing the City’s agreement as determined by the City
under their written agreement and conditions only.

IX. COLLATERALIZATION

Time and Demand Pledged Collateral
All time and demand deposits placed by the Permanent Fund that exceed the limits of
coverage provided by Federal Deposit Insurance Corporation (FDIC) shall be
transferred to a money market fund or otherwise collateralized in accordance with the
Texas Public Funds Collateral Act with collateral pledged to the Permanent Fund. In
order to anticipate market changes and provide a level of security for all funds,
collateral shall be maintained and monitored by the pledging depository at 102% of
market value of principal and accrued interest on the deposits. The pledging bank shall
monitor and maintain the margins on a daily basis. All collateral shall be subject to
inspection and audit by the City or its internal and external auditors.

Collateral pledged to secure deposits of the Trust Fund assets shall be held by an
independent financial institution outside the holding company of the depository, as
approved by the Trustee, and in accordance with a safekeeping agreement executed
under the terms of the Financial Institutions Resource and Recover Enforcement Act
(FIRREA).

Permanent Fund Owned Collateral Under Repurchase Agreements

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