Issue - meetings

To receive a report of the Deputy Leader & Cabinet Member for Finance seeking agreement to proposed changes to the Treasury Strategy.

–  report  of  the  Deputy  Leader  and  Cabinet  Member  for  Finance  and Procurement,Mr Simmondsand theCorporateDirector forFinance,AndyWood)

(1)   Cabinet  received  a  report  seeking  agreement  to  revisions  to  the  Council’s TreasuryStrategy. TheDeputyLeader,Mr Simmonds,introducedthe report.

(2)   Heconfirmedthat theCounty Council hadapproved theTreasuryManagement Strategy in February2014but,owing to thechanging natureofthe economic climate,amendments werenow desirablewhich Cabinetwere authorisedto make.    Thesuggestedchangeshadbeenconsideredby thead-hocall-party group onTreasuryManagementand werein linewith the relevantcode of practice forsuch matters.

(3)   Cabinetheardthatthechangeswere necessaryas aresultofdevelopments sinceFebruary,these were:

i.    Thechanged attitudeofGovernmentsto ‘bailingout’ banksthathad experienced financialdifficultyhad increasedthe levelof riskborne by investors.

ii.       TherequirementoftheStrategythat noonebankbeinvestedin beyond £40  million  was  increasingly  difficult  to  manage  owing  to  the  limited numberofappropriatebanks thathadbeenfurtherreducedby thedown rating of RBSandNatWesttoa level thatwas notacceptableto KCC.  In addition,depositratesremainedpoor atthosebankswith whichKCC couldinvest.

(4)   Finally,Mr Simmondsreported thatwhere successhadbeenachievedin new assetclasses suchas‘covered bonds’ returnswere restricted bythe initial limitationson investmentset out inFebruary.

(5)   HeadofFinancialS  ...  view the full minutes text for item 63