TRANSMITTAL LETTER FOR BOARD MEETING OF MARCH 4, 2021
COMMITTEE ON FINANCE
Mr. Brian A. Perkovich, Executive Director
Title
Report on the investment interest income during December 2020
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Dear Sir:
Attached is a report of cash investment interest income received by the District for the month of December 2020 and a comparison of income for the same period in 2019.
The District’s inventory of investments at December 31, 2020, consisted of 274 items having a total par value of $642,640,108.46, an average annual yield of 0.430%, and total interest income to maturity of approximately $6.7 million. Inventory figures at the same date in 2019 were 303 items having a total par value of $671,825,524.11, an average annual yield of 1.837%, and total interest income to maturity of approximately $12.4 million.
Interest Forecast for 2021:
On March 23, 2020, the Federal Reserve decided to decrease the target range for the federal funds rate to 0.00% to 0.25%. This decision was based upon the increased risk to economic activity posed by the COVID-19 pandemic. There has been no change in these short-term interest rates since that date. The District expects to earn exceptionally low investment yields in 2021 due to the low federal funds rate.
Respectfully Submitted, Mary Ann Boyle, Treasurer, MAB
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