FY 2008 ANNUAL INVESTMENT REPORT MARTHA O. HAYNIE, CPA COUNTY COMPTROLLER

2 Investment Objectives Safety Liquidity Yield

3 Agenda Highlights Benchmarks Portfolio & Fed Rates Treasury Yield Curves Economic Conditions September Turmoil Investment Committee Committee Discussions Recommendations FY 2007 Portfolio Composition FY 2008 Portfolio Composition Current Portfolio Composition

4 Highlights (in millions) Interest earned$46.9$67.2 Effective rate of return3.24%5.07% Average daily balance$1,444$1,325

5 Benchmarks BenchmarkFY 2008VarianceFY 2007Variance Portfolio3.24%5.07% 3-Month Treasury2.18%1.06%4.86%0.21% 6-Month Treasury2.40%0.84%4.96%0.11% Merrill Lynch 0-1 Treasury Index2.50%0.74%4.93%0.14% 1-Year Treasury2.48%0.76%4.86%0.21% 2-Year Treasury2.57%0.67%4.67%0.40% Effective Federal Funds2.93%0.31%5.21%-0.14% Committee Benchmark2.49%0.75%5.00%0.07%

6 Portfolio and Fed Rates

7 Treasury Yield Curves

8 Economic Conditions Declining interest rates Deteriorating housing market Reduced lending Higher energy costs Rising unemployment Crisis in September Federal Reserve lowering interest rates Congress passes $700 billion rescue package Forecasts of negative GDP in 2009 Negative Treasury yields

9 September Turmoil 9/07 – U.S. government seizes control of Fannie Mae and Freddie Mac 9/15 – Lehman Brothers files for bankruptcy 9/15 – Bank of America announces plans to acquire Merrill Lynch 9/16 – Reserve funds break buck 9/16 – AIG rescued by Federal Government 9/25 – Government seizes control of WaMu 9/29 – FDIC brokers Citigroup acquisition of Wachovia (Wachovia later agreed to be acquired by Wells Fargo)

10 Investment Committee Community Volunteers Ed Manning Retired Managing Partner of Ernst and Young, CPA John Cheney, DBA Retired Associate Professor of Finance, University of Central Florida

11 Committee Discussions SBA crisis Analysis of agency issuers Review of the Florida QPD program Evaluation of existing and potential money market mutual funds Conservatorship of Fannie Mae and Freddie Mac Impact of financial crisis

12 Recommendations Sold entire position in SBA Eliminated BAs and CP issued by financial companies Later suspended all CP Curtailed and later suspended agency investments Suspended all CD investments Minimized money market balances Maximized Treasury investments

13 FY 2007 Portfolio Composition

14 FY 2008 Portfolio Composition

15 Current Portfolio Composition

16 FY 2008 ANNUAL INVESTMENT REPORT Interest earned$46.9 million Effective rate of return 3.24% The 2009 effective rate of return?

17 REPORT ONLINE FY 2008 ANNUAL INVESTMENT REPORT