Issue - meetings

This report provides an update on Treasury Management performance for 2008/09, as compared against the budget taken to Council on 21 February 2008.

RESOLVED: (i)         That the 2008/09 performance of the Treasury Management activity, movements on the Venture Fund and the Treasury Management out-turn be noted.

                        (ii)        That the addition of Nationalised Banks to the Investment Credit Criteria Policy, as set out at paragraphs 30 top 38 of the report, be approved.

                        (iii)       That the movements in the Prudential Indicators be noted.

                        (iv)       That the Council’s proactive and prudent management of the Treasury Management portfolio in the light of the Icelandic banking crisis be noted.

REASON:      For information, and to ensure an adequate number of authorised counterparties with whom the Council can invest.

Members considered a report which provided an update on the Treasury Management performance during 2008/09, compared against the budget taken to Full Council on 21 February 2008.

The report summarised the economic environment over the 2008/09 financial year, highlighting the effects of the economic downturn on the budget set in February 2008.  It reviewed treasury management performance in respect of long term borrowing, debt restructure, short term investments, investment credit criteria policy, the post Icelandic Bank collapse, the Venture Fund, the Treasury Management out-turn and the Prudential Indicators.

With regard to the credit criteria policy, it had emerged during the latter part of 2008/09 that the number of authorised counterparties with whom the Council could invest had been greatly reduced due to credit rating changes prompted by the ‘credit crunch’.  In view of this, and the nationalisation of a number of financial institutions following the collapse of Lehman’s and the Icelandic banking systems, approval was sought to include the following nationalised banks in the Council’s credit rating criteria policy:

• Bank of Scotland Plc (including its subsidiaries Lloyds TSB Bank and Cheltenham and Gloucester)
• Royal Bank of Scotland Plc (including its subsidiaries National Westminster Bank, Ulster Bank and ABN AMRO Bank NV)
• Northern Rock Plc

Having noted the comments of the Shadow Executive on this item, it was

RESOLVED: (i)         That the 2008/09 performance of the Treasury Management activity, movements on the Venture Fund and the Treasury Management out-turn be noted.

                        (ii)        That the addition of Nationalised Banks to the Investment Credit Criteria Policy, as set out at paragraphs 30 top 38 of the report, be approved.¹

                        (iii)       That the movements in the Prudential Indicators be noted.

                        (iv)       That the Council’s proactive and prudent management of the Treasury Management portfolio in the light of the Icelandic banking crisis be noted.

REASON:      For information, and to ensure an adequate number of authorised counterparties with whom the Council can invest.