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NOTE 2 — DEPOSITS AND INVESTMENTS (CONTINUED)
<br />B. Deposits
<br />In accordance with applicable Minnesota Statutes, the City maintains deposits at depository banks
<br />authorized by the City Council, including checking accounts and certificates of deposits.
<br />The following is considered the most significant risk associated with deposits:
<br />Custodial credit risk — In the case of deposits, this is the risk that in the event of a bank failure, the
<br />City's deposits may be lost.
<br />Minnesota Statutes require that all deposits be protected by federal deposit insurance, corporate surety
<br />bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not covered
<br />by federal deposit insurance or corporate surety bonds. Authorized collateral includes treasury bills,
<br />notes, and bonds; issues of U.S. government agencies; general obligations rated "A" or better; revenue
<br />obligations rated "AA" or better; irrevocable standard letters of credit issued by the Federal Home Loan
<br />Bank; and certificates of deposit. Minnesota Statutes require that securities pledged as collateral be held
<br />in safekeeping in a restricted account at the Federal Reserve Bank or in an account at a trust department
<br />of a commercial bank or other financial institution that is not owned or controlled by the financial
<br />institution furnishing the collateral. The City has no additional deposit policies addressing custodial
<br />credit risk.
<br />At year end, the carrying amount of the City's deposits was $4,495,778 while the balance on the bank
<br />records was $4,832,071. At December 31, 2012, all deposits were fully covered by federal depository
<br />insurance, surety bonds, or by collateral held by the City's agent in the City's name.
<br />C. Investments
<br />The City has the following investments at year end:
<br />Credit Risk Interest Risk- Maturity Duration in Years
<br />Investment Type
<br />U.S. Treasuries
<br />U.S. Agencies
<br />U.S. Agencies
<br />Municipal Bonds
<br />Municipal Bonds
<br />Negotiable Certificates of Deposit
<br />Investment pools
<br />Federated Treasury Cash Series
<br />Federated Government Reserves
<br />Minnesota Municipal Money
<br />Market
<br />Total Investments
<br />N/A Not Applicable
<br />N/R Not Rated
<br />Rating
<br />N/A
<br />Aaa
<br />AA+
<br />Baa3 -Aaa
<br />A -AAA
<br />Agency
<br />N/A
<br />Moodys
<br />S &P
<br />Moodys
<br />S &P
<br />N/A N/A
<br />Aaa
<br />N/R
<br />Moodys
<br />N/A
<br />N/R N/A
<br />Less Than 1
<br />$ 56,854
<br />161 403,260 1,979,399 4,241,935 227,633
<br />- 1,047,200 - -
<br />5,719,253 3,039,754 1,138,050
<br />846,741 4,675,778 893,111
<br />3,820,644 1,691,789 150,000
<br />843
<br />44,873
<br />11,657,072
<br />lto5 6to10 11to15 >15
<br />$2,951,979 $ 8,364 $ - $ -
<br />Total
<br />$ 3,017,197
<br />6,852,387
<br />1,047,200
<br />9,897,057
<br />6,415,630
<br />5,662,433
<br />843
<br />44,873
<br />11,657,072
<br />$44,594,692
<br />
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