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ATTACHMENT 2 <br />4 <br />authorized to provide investment services. In addition, a list will also be maintained of <br />approved security broker/dealers selected by credit worthiness, these may include <br />"primary" dealers or regional dealers that qualify under Security & Exchange Commission <br />Rule 15C3-1 (uniform net capital rule). All broker investment transactions require the <br />approval of authorized City staff. No public deposit shall be made except in a qualified <br />public depository as established by state laws, and deposits will be insured by the Federal <br />Deposit Insurance Corporation, or, to the extent the amount exceeds the insured <br />maximum, will be collateralized in accordance with State law. <br />In accordance with Section 53601.5, institutions eligible to transact investment business <br />with the City include: <br />•Institutions licensed by the state as a broker-dealer <br />•Institutions that are members of a federally regulated securities exchange <br />•Primary government dealers as designated by the Federal Reserve Bank and non- <br />primary government dealers <br />•Nationally or state-chartered banks <br />•The Federal Reserve Bank <br />•Direct issuers of securities eligible for purchase <br />All financial institutions and broker/dealers who desire to become qualified bidders for <br />investment transactions must supply the Director of Finance with the following: audited <br />financial statements, completed broker/dealer questionnaire, and certification of having <br />reviewed California Government Code, Section 53600 et seq. and read the City's <br />investment policy. <br />Selection of broker/dealers used by an external investment adviser retained by the City <br />will be at the sole discretion of the adviser. Where possible, transactions with <br />broker/dealers shall be selected on a competitive basis and their bid or offering prices <br />shall be recorded. If there is no other readily available competitive offering, best efforts <br />will be made to document quotations for comparable or alternative securities. When <br />purchasing original issue instrumentality securities, no competitive offerings will be <br />required as all dealers in the selling group offer those securities at the same original issue <br />price. <br />Page 37 of 248