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Type: FCA Regulation
PART 615 - FUNDING AND FISCAL AFFAIRS, LOAN POLICIES AND OPERATIONS, AND FUNDING OPERATIONS
Subpart E - Investment Management


615.5140 Eligible investments.
(a) You may hold only the following types of investments listed in the Investment Eligibility Criteria Table. These investments must be denominated in United States dollars.
Investment Eligibility Criteria Table

Asset Class
Final Maturity Limit
NRSRO Credit Rating
Other
Requirements
Investment Portfolio Limit
(1) Obligations of the United States
Treasuries
Agency securities (except mortgage securities)
Other obligations fully insured or guaranteed by the United States, its agencies, instrumentalities and corporations
NoneNANoneNone
(2) Municipal Securities
General obligations10 yearsOne of the highest twoNoneNone
Revenue bonds5 yearsHighestAt the time of purchase, you must document that the issue is actively traded in an established secondary market15%
(3) International and Multilateral Development Bank ObligationsNoneNoneThe United States must be a voting shareholderNone
(4) Money Market Instruments
Federal funds1 day or continuously callable up to 100 daysOne of the two highest short-termNoneNone
Negotiable certificates of deposit1 yearOne of the two highest short-termNoneNone
Bankers acceptancesNoneOne of the two highest short-termIssued by a depository institutionNone
Commercial paper270 daysHighest short-termNoneNone
Non-callable Term Federal funds and Eurodollar time
    deposits
100 daysHighest short-termNone20%
Master notes270 daysHighest short-termNone20%
Repurchase agreements collateralized by eligible investments or marketable securities rated in the highest credit rating category by an NRSRO100 daysNANoneNone
(5) Mortgage Securities
Issued or guaranteed by the United StatesNoneNANoneNone
Fannie Mae or Freddie Mac mortgage securitiesNoneNANone50%
Non-Agency securities that comply 15 U.S.C. 77d(5) or 15 U.S.C. 78c(a)(41)NoneHighestNone15%
Commercial mortgage-backed securitiesNoneHighest Security must be backed by a minimum of 100 loans.
Loans from a single mortgagor cannot exceed 5% of the pool
Pool must be geographically diversified pursuant to the board's policy.
(6) Asset-Backed Securities
    secured by:
Credit card receivables
Automobile loans
Home equity loans
Wholesale automobile dealer loans
Student loans
Equipment loans
Manufactured housing loans
NoneHighest5-year WAL for fixed rate or floating rate ABS at their contractual interest rate caps

7-year WAL for floating rate ABS that remain below their contractual interest rate cap
20%
(7) Corporate Debt Securities5 yearsOne of the two highestCannot be convertible to equity securities20%
(8) Diversified Investment Funds
    Shares of an investment company registered under section 8 of the Investment Company Act of 1940
NANAThe portfolio of the investment company must consist solely of eligible investments authorized by 615.5140 and 615.5174.

The investment company’s risk and return objectives and use of derivatives must be consistent with FCA guidance and your investment policies.
None, if your shares in each investment company comprise 10% or less of your portfolio. Otherwise counts toward limit for each type of investment.

(b) Rating of foreign countries. Whenever the obligor or issuer of an eligible investment is located outside the United States, the host country must maintain the highest sovereign rating for political and economic stability by an NRSRO.
(c) Marketable securities. All eligible investments, except money market instruments, must be marketable. An eligible investment is marketable if you can sell it quickly at a price that closely reflects its fair value in an active and universally recognized secondary market.
(d) Obligor limits.
(1) You may not invest more than 20 percent of your total capital in eligible investments issued by any single institution, issuer, or obligor. This obligor limit does not apply to obligations, including mortgage securities, that are issued or guaranteed as to interest and principal by the United States, its agencies, instrumentalities, or corporations.
(2) Obligor limits for your holdings in an investment company. You must count securities that you hold through an investment company towards the obligor limit of this section unless the investment company's holdings of the security of any one issuer do not exceed five (5) percent of the investment company’s total portfolio.
(e) Other investments approved by the FCA. You may purchase and hold other investments that we approve. Your request for our approval must explain the risk characteristics of the investment and your purpose and objectives for making the investment.

[64 FR 28896, May 28, 1999, as amended at 77 FR 66372, Nov. 5, 2012]

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