Written on November 30th, 2009 by ccottrell2 shouts
Other states have had runs of withdrawals from their public investment pools because of worries about their holdings in the mortgage industry but Arizona isn’t in the same boat, state Treasurer Dean Martin said Friday.
Florida suspended investment pool withdrawals because of a run by local governments spooked by downgrades of that state’s extensive mortgage-based holdings. Montana also had a run.
State investment pools are similar to private money-market funds. Cities, counties, school districts and other local entities invest money on a short-term basis in the funds and withdraw cash when needed to make payrolls and pay other operating costs.
Martin said Arizona reviewed its $12 billion state and local government investment pool when he took office in January and is sticking with a course of avoiding risky mortgage-related investments.
“My philosophy is safety first, then liquidity, then yield,” said Martin, a Republican and a former state senator.
Martin said the Treasurer’s Office invests in highly rated mortgage-related products but has never purchased any dependent on sub-prime mortgages for repayment.
In reviewing its mortgage investments, Arizona did find at least one that had a few mortgages that didn’t meet standards for higher-graded investment products, Martin said. Those short-term investments haven’t been renewed, he said.
Also, the Treasurer’s Office started reducing its mortgage-related investments in mid-2006 when Chief Investment Officer Tim White, whom Martin promoted to that position earlier this year, realized that the housing bubble was going to burst, Martin said.
Tom Bellshe, deputy director of the League of Arizona Cities and Towns, expressed confidence in the Arizona investment pool’s status.
“We won’t have the same kind of problems,” said Bellshe. “We feel good about the direction he’s taking us in.”
Arizona law requires the state to take a more conservative approach on investing than some other states and Martin has reviewed and tightened investment practices even further since he took office, Bellshe said.
Of the $12 billion in Arizona’s investment fund, $5.5 billion belongs to the state, $4 billion to local governments and $2.5 billion to the state land trust. Arizona’s public employees’ retirement system has a separate investment fund.
A Montana budget official told lawmakers in that state on Thursday that local governments and school districts this week pulled 27 percent of the $896 million that they had in the state’s short term investment pool.
Also Thursday, a Florida board chaired by Florida Gov. Charlie Christ suspended withdrawals to halt a run which saw local governments pull 40 percent of the assets from a state-operated investment pool.
“As you know, many of these investments are now non-performing and incurring losses for investors,” Martin said Friday in a letter to Arizona investors. “Because we avoided these products, we will not experience any losses associated with them.”
Since word of the two other state’s problems has come out, only two calls have come in from Arizona local government officials “who were just double-checking,” Martin said in an interview. “No panicked phone calls or anybody making major changes.”
By PAUL DAVENPORT, Associated Press Writer
Information from: http://www.aztreasury.gov/media/2007/BusinessWeek-11-07.html, Business Week
Written on November 21st, 2009 by admin2 shouts
Dean Press Conference
The State Treasurer serves as the Chief Financial Officer for the State of Arizona, overseeing approximately $10.3 billion in assets under management. As a statewide constitutional officer, third in line of succession to the Governor, the Treasurer is responsible for the prudent custody and management of your tax dollars.
The State Treasurer is the trustee and manages over $2.2 billion of investments for the Arizona State Land Endowment Trust. There are 13 different investment pools for the endowment; the largest is the Public Common School Fund benefiting education. Millions of dollars each year are distributed directly to classrooms around Arizona as a result of our investments. To read more about how the Treasurer and the State Land Trust help education funding, click here.
The State Treasurer also provides investment services to local governments (counties, cities, towns, etc). Local governments may use the State Treasurer as an investment manager. By pooling their deposits with the State Treasurer, we can earn higher returns for both the State and local governments. We also provide same-day liquidity, and save local governments the cost of operating a duplicate trading room and investment accounting operation. Currently we manage over $4.3 billion for local governments in Arizona.
The Treasurer’s Office has three separate accounting divisions to track deposits, investments, transfers, and distributions. The Treasurer’s office also has audit authority over all state finances. We track over 1,600 separate accounts for deposit, with over 500 accounts that can statutorily earn interest. Every dollar deposited earns investment income; revenue from non-interest earning eligible accounts is deposited in the General Fund. Last year we made and distributed profits of $218.2 million dollars!
The Treasurer’s Office is also the bank for state government. We reconcile approximately one billion dollars of transactions each day (credits and debits). Our office pays all warrants for the State of Arizona, as well as wire transfers. We manage the state’s cash flow and daily forecast future cash needs. We also contract with armored car service to pick up deposits directly from state agencies and branch offices across Arizona so that your tax money is deposited, invested, and earning interest the same day!
We are committed to the implementation of the latest technology, acquiring and retaining the best staff possible to achieve maximum efficiency in our operations and focusing on the protection of taxpayer dollars. Thank you for visiting our website.
Written on November 30th, 2007 by ccottrellno shouts
PHOENIX (AP) — Florida had a run of withdrawals from its public investment pool because of worries about the mortgage industry but Arizona Treasurer Dean Martin says Arizona isn’t in the same boat.
Florida suspended investment pool withdrawals because of a run by local governments spooked by downgrades of that state’s extensive mortgage-based holdings.
Martin said Friday that Arizona reviewed its $12 billion state and local government investment pool when he took office in January and is sticking with a conservative course of avoiding risky mortgage-related investments.
Martin says the Arizona Treasurer’s Office never purchased sub-prime mortgage investment vehicles and didn’t renew a few mortgage-related investments that weren’t as clean as had been advertised.
By PAUL DAVENPORT / Associated Press Writer
Information from: http://www.aztreasury.gov/media/2007/FOX11-11-07.html, Fox11AZ.com
