12-31-2011 VNPB Investment Performance ReviewInvestment Advisors
Steven Alexander, CTP, CGFO, Managing Director
David Jang, CTP, Senior Managing Consultant
Gregg Manjerovic, CFA, Portfolio Manager
Rebecca Dole, CTP, Consultant
Jan Anguel, Consultant
Village of North Palm Beach
Investment Performance Review
Quarter Ended December 31, 2011
North Pal
s* 4
PFM Asset Management LLC
300 S. Orange Avenue, Suite 1170 One Keystone Plaza, Suite 300
Orlando, FL 32801 North Front & Market Streets
(407) 648 -2208 Harrisburg, PA 1 71 01 -2044
(407) 648 -1323 fax 717- 232 -2723
717 - 233 -6073 fax
Village of North Palm Beach Investment Report - Quarter Ended December 31, 2011
Table of Contents
Tab I.
Section A Market Review
Tab II.
Section A Quarterly Summary Report
Section B Investment Portfolio & Performance
Section C Asset Allocation Chart as of December 31, 2011
Tab III. December 31, 2011 PFM Month -End Statement
(statements are available online at www.pfm.com)
This material is based on information obtained from sources generally believed to be reliable and available to the public,
however PFM Asset Management LLC cannot guarantee its accuracy, completeness or suitability. This material is for general
information purposes only and is not intended to provide specific advice or recommendation. The information contained in this
report is not an offer to purchase or sell any securities.
Table of Contents Section i
Village of North Palm Beach Investment Report — Quarter Ended December 31, 2011
Summary
• Quarterly returns for fixed income were positive but failed to beat
returns on domestic equities.
• For the quarter, short- to intermediate- duration portfolios with
diversified fixed - income holdings outpaced money market accounts
that avoided European exposure, including Libor -based time
deposits.
• PFM strives to maintain the safety of principal while at the same time
positioning for growth and searching for tactical opportunities to
enhance return.
Economic News
Growth in the U.S. has improved while the uncertainty surrounding
Europe continues. Gross domestic product (GDP) in the U.S. has shown
steady increases over the first three quarters of 2011, coming in at 0.4 %,
1.3% and 1.8 %, respectively. Most projections for fourth - quarter GDP
growth are near 3 %. Although much of the economic expansion can be
attributed to the release of pent -up demand for autos and a restocking of
inventories by businesses, positive signals have emerged, showing more
stabilization and a fundamental strengthening of the domestic economic
recovery.
While signs of tentative recovery are now occurring in the housing
market, there is still a significant amount of foreclosures in the pipeline,
suggesting a higher inventory of unoccupied houses. A massive
downward revision to earlier existing -home sales data showed that the
housing market suffered a larger loss than many previously thought. Sales
from 2007 onward have had significant downward revisions of 14% on
average. Recently, though, there have been positive trends in home sales,
with the October - November average annual rate of home sales up 20%
from the third quarter. In November, existing -home sales rose 4.0 %,
significantly above the consensus of 2.2 %, while new -home sales rose by
1.6% and housing starts increased by 9.3 %.
Indicators are showing improvement in labor market conditions, but
there is still much that needs to be resolved in this arena as well. The
unemployment rate fell to a 21/2-year low of 8.5% in December; however,
much of this outcome has to do with the fact that the labor force
participation rate has reached a two -year low. Market participants
continue to wait for the abatement of excess slack in the labor market.
Results for the Conference Board's Consumer Confidence Survey
reflected an increase in positive sentiment, with the number of
respondents reporting that jobs are currently "hard to get" falling to
41.8 %, the lowest level of the recovery. This development, along with
other strong economic releases in the fourth quarter, led to robust
quarterly performance for U.S. equities. The S &P 500 Index increased
11.8% in the fourth quarter, erasing the losses in the previous two
quarters.
U.S. Treasury Yields — Quarter and Year - over -Year Changes
Date 3-month 1-year 2-year 5-year i i
31- Dec -11 0.01% 0.10% 0.24% 0.83% 1.88% 2.89%
30- Sep-11 0.02% 0.10% 0.24% 0.95% 1.92% 2.91%
Changeover Quarter -0.01% 0.00% 0.00% -0.12% -0.04% -0.02%
31- Dec -10 0.12% 0.26% 0.59% 2.01% 3.29% 4.33%
Change over Year -0.11% -0.16% -0.35% -1.18% -1.41% -1.44%
Source data: Bloomberg
Village of North Palm Beach Investment Report — Quarter Ended December 31, 2011
Interest Rates
U.S. Treasuries fluctuated within a narrow range, finishing the quarter
close to where they began. Short -term rates remained near zero due to
the Federal Reserve's ( Fed's) continued commitment to keep the target
rate between zero and 0.25% until at least mid 2013. Meanwhile,
intermediate- and long -term rates have stabilized due to the offsetting
forces of positive economic data in the U.S., a flight -to- quality reaction to
the European debt crisis and the Fed's Operation Twist program, where
the U.S. central bank purchases longer -dated securities while selling
shorter -dated securities in an effort to keep longer -term interest rates
down.
2 -Year, 5 -Year, and 10 -Year U.S. Treasury Note Yields
December 31, 2010 through December 31, 2011
4.0%
3.5%
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0% +_
Dec 10
Feb 11 Apr 11 Jun 11 Aug 11 Oct 11 Dec 11
2 -Year TSY 5 -Year TSY 10 -Year TSY
Source: Bloomberg
Bond Markets
Although signs point towards a stronger economy in the U.S., continued
uncertainty in the global economic outlook has resulted in investors
becoming more cautious and gravitating towards securities that are
perceived to be less risky. Assets have flowed out of prime money market
funds into government funds on concerns of the funds' potential
exposure to the sovereign debt of struggling European nations.
Treasuries have benefitted from this need for safety, posting positive
performance for the quarter. Treasury yields are still hovering around
their record lows. Agency spreads widened during the fourth quarter,
while corporate spreads tightened. Both sectors offered value for
investors.
15.0%
10.0%
5.0%
0.0%
-5.0%
-10.0%
-15.0%
Total Returns of Various Asset Classes
Quarter ended December 3 9, 2011
11.8%
0 0
2.1% 3.4% . 0 2.4%
0.6% 0.4% 0.3%
■ Quarterly Return
■ Annual Return
-11.7%
S &P500 Index
MSCI
1 -5 Year 1 -5 Year
1 -5 Year Citigroup
Total Return
EAFE
A -AAA Treasury
Federal Euro
(Domestic
Total Return
Corporate Index
Agency Bond Index
Equity)
(International
Index
Index
Equity)
Sources: Bank ofAmerica
Merrill Lynch, Citigroup, Bloomberg
The views expressed within this material constitute the perspective and judgment of PFM Asset Management LLC (PFMAM) at the time of distribution and are subject to change.
Information is obtained from sources generally believed to be reliable and available to the public; however, PFMAM cannot guarantee its accuracy, completeness or suitability. This
material is for general information purposes only and is not intended to provide specific advice or recommendation. The information contained in this report is not an offer to
purchase or sell any securities.
Village of North Palm Beach Investment Report - Quarter Ended December 31, 2011
Quarterly Summary Report
Total Portfolio Value'' December 31,20111 September 30, 2011
Market Value
$8,273,215.37
$8,257,389.21
Fiscal Year 2012
Fiscal Year 2011
Amortized Cost
$8,217,035.94
$8,194,212.86
Fiscal Year Interest Income
Year to Date
Year to Date
Investment Portfolio
Quarterly Return
Annualized
Last
Last
Since Inception
Total Return'2' 4's1''
December 31, 2011
Quarter
12 Months
24 Months
June 30, 2009
Investment Portfolio
0.19%
0.76%
1.43%
1.78%
1.78%
Merrill Lynch 1 -3 Year U.S. Treasury Index
0.20%
0.78%
1.55%
1.95%
1.88%
Quarterly Realized Gain /Loss on Cost
Current Quarter
Previous Quarter
Fiscal Year Realized Gain /Loss on Cost
Current Quarter
Previous Quarter
Effective Duration(Years) °
December 31, 2011
September 30, 2011
Yields
December 31, 2011
September 30, 2011
Investment Portfolio
1.73
1.71
Yield at Market
0.29%
0.34%
Merrill Lynch 1 -3 Year U.S. Treasury Index
1.81
1.81
Yield at Cost
0.81%
0.89%
Portfolio Duration % of Benchmark Duration
95%
95%
1.00%
0.75%
E
a)
0.50%
ry
0.25%
0.00%
0.50
Quarter Total Return Comparison
Quarter Ended 12/31/11
1.00 1.50 2.00 2.50 3.00
Effective Duration (Years)
3.50
3.00%
2.50%
2.00%
1.50%
1.00%
0.50
Total Return Comparison Since Inception as of
Quarter Ended 12/31/11
1.00 1.50 2.00 2.50 3.00
Effective Duration (Years)
e
Notes:
1. In order to comply with GASB accrual accounting reporting requirements.
2. End of quarter trade -date market values of portfolio holdings, including accrued interest.
3. Performance on trade date basis, gross (i.e., before fees), is in accordance with The CFA Institute's Global Investment Performance Standards (GIPS).
4. Merrill Lynch Indices provided by Bloomberg Financial Markets.
5. Quarterly returns are presented on an unannuali -c! basis.
6. Includes money market fund /cash in performance and duration computations.
7. Returns presented for 12 months or longer are presented on an annual basis.
8. Past performance is not indicative of future results.
PFM Asset Management LLC Section A - 1
Current Quarter
Previous Quarter
Fiscal Year 2012
Fiscal Year 2011
Quarterly Interest Income
December 31, 2011
September 30, 2011
Fiscal Year Interest Income
Year to Date
Year to Date
Investment Portfolio
$31,806.54
$17,351.28
Investment Portfolio
$31,806.54
$96,644.68
TD Bank Money Market Fund
1.63
1.17
TD Bank Money Market Fund
1.63
34.78
Total
$31,808.17
$17,352.45
Total
$31,808.17
$96,679.46
Current Quarter
Previous Quarter
Fiscal Year 2012
Fiscal Year 2011
Quarterly Realized Gain /Loss on Cost
December 31, 2011
September 30, 2011
Fiscal Year Realized Gain /Loss on Cost
Year to Date
Year to Date
Investment Portfolio
($1,216.93)
$6,023.12
Investment Portfolio
($1,216.93)
$24,540.42
Notes:
1. In order to comply with GASB accrual accounting reporting requirements.
2. End of quarter trade -date market values of portfolio holdings, including accrued interest.
3. Performance on trade date basis, gross (i.e., before fees), is in accordance with The CFA Institute's Global Investment Performance Standards (GIPS).
4. Merrill Lynch Indices provided by Bloomberg Financial Markets.
5. Quarterly returns are presented on an unannuali -c! basis.
6. Includes money market fund /cash in performance and duration computations.
7. Returns presented for 12 months or longer are presented on an annual basis.
8. Past performance is not indicative of future results.
PFM Asset Management LLC Section A - 1
Village of North Palm Beach
Executive Summary
PORTFOLIO STRATEGY
Investment Report - Quarter Ended December 31, 2011
➢ The Village's Investment Portfolio is of high credit quality and invested in U.S. Treasury, Federal Agency, and U.S.
Government Supported Corporate Notes securities.
➢ For the third quarter in a row, Treasuries outperformed Agencies, while Corporates out - performed both Treasuries and
Agencies for the quarter, reversing a portion of the large sell -off in Third Quarter. In the corporate sector, non - financials
(average rating A -) out - performed financials (average rating A +) for the quarter and the year by a wide margin.
➢ The near -zero net change in yields belies the volatility seen intra - quarter. We used this movement in spreads to take profits
on individual corporate, treasury and agency holdings, and to reset those positions on sell -offs in risky assets. On several
occasions, both agencies and corporate spreads tightened on expectations of a possible solution to the European debt crisis,
only to widen again when various proposals disappointed.
➢ With interest rates falling to historic lows, we maintained a slightly conservative duration posture at around 95% of the
benchmark's duration to retain flexibility. Even though short -term rates have remained near 0% for over three years, the
portfolio earned a total return of 1.43% over the past year.
➢ In an environment of range bound yields, performance can be enhanced by holding longer maturities, which have higher
initial yields and benefit from "roll down." PFM employed this strategy, rolling treasury, agencies, and coporates with shorter
maturities into higher yielding 2 -3 year maturities.
➢ The Fed could well seek to provide further support for the U.S. economy by communicating the intention to maintain its
extraordinarily accommodative monetary policy far into the future, or by establishing specific employment and inflation
hurdles that would have to be breached before it changes its current policy stance. This supports the view that rates will
remain low longer than the market current anticipates.
➢ The yield curve is likely to remain positively sloped, anchored for the foreseeable future by the near -zero federal funds rate.
In this environment, lengthening duration should provide value, although longer duration investments have greater price risk if
interest rates should rise.
➢ Europe remains a highly fluid and problematic situation, as Italy and Spain appear headed for recession. Sovereign credit
ratings are under pressure, and large European banks are being forced to shed assets and raise large amounts of capital. A
clear solution appears elusive. We continue to avoid sensitive issuers and geographical regions.
➢ As always, we strive to maintain the safety of principal while at the same time positioning the Investment Portfolio for growth
and searching for tactical opportunities to enhance return. In these changing times, our strategy will remain flexible and may
change in response to changes in interest rates, economic data, market outlook or specific opportunities that arise.
PFM Asset Management LLC Section B - 1
Village of North Palm Beach Investment Report - Quarter Ended December 31, 2011
Investment Portfolio Composition and Credit Quality Characteristics
Security Type
December 31, 2011
% of Portfolio
September 30, 2011
% of Portfolio
U.S. Treasuries
$5,685,738.12
68.7%
$4,741,652.00
57.4%
Federal Agencies
2,101,504.41
25.4%
2,569,126.28
31.1%
Commercial Paper
0.00
0.0%
0.00
0.0%
Certificates of Deposit
0.00
0.0%
0.00
0.0%
Bankers Acceptances
0.00
0.0%
0.00
0.0%
Repurchase Agreements
0.00
0.0%
0.00
0.0%
Municipal Obligations
0.00
0.0%
0.00
0.0%
Corporate Notes /Bonds
0.00
0.0%
0.00
0.0%
Corporate Notes /Bonds - FDIC Insured
404,157.33
4.9%
907,643.30
11.0%
Mortgage Backed
0.00
0.0%
0.00
0.0%
Money Market Fund /Cash
81,815.51
1.0%
38,967.63
0.5%
Totals
$8,273,215.37
100.0%
$8,257,389.21
100.0%
U.S. Treasuries
69%
Portfolio Composition
as of 12/31/11
Federal Agency
_Obligations
25%
Corporate
Notes /Bonds -
FDIC Insured
5%
9oney Market
Fund /Cash
0.99%
Notes:
1. End of quarter trade -date market values of portfolio holdings, including accrued interest.
2. Credit rating of securities held in portfolio, exclusive of money market fund /LGIP. Standard & Poor's is the source of the credit ratings.
Credit Quality Distribution
as of 12/31/11
AA+
-- __
/100%
1
PFM Asset Management LLC Section B - 2
Village of North Palm Beach
Investment Report - Quarter Ended December 31, 2011
80%
Investment Portfolio Maturity Distribution
Maturity Distribution' December 31, 2011
September 30, 2011
Overnight (Monedy Market Fund)
$81,815.51
$38,967.63
Under 6 Months
404,157.33
0.00
6 - 12 Months
201,948.31
1,440,988.82
1 - 2 Years
5,532,828.75
3,394,318.79
2 - 3 Years
2,052,465.47
3,383,113.97
3 - 4 Years
0.00
0.00
4 - 5 Years
0.00
0.00
5 Years and Over
0.00
0.00
Totals $8,273,215.37 $8,257,389.21
Notes:
1. Callable securities in portfolio are included in the maturity distribution analysis to their stated maturity date, although they may be called prior to maturity.
PFM Asset Management LLC Section B - 3
Portfolio Maturity Distribution'
80%
70%
67%
[]December 31, 2011
■September 30, 2011
60%
0
0
50%
0
41% 41%
40%
0
30%
0
25%
a�
ca
20%
17%
c
a�
10%
o
5 %
d
0%
1 % 0% 0% 2%
0% 0% 0% 0% 0% 0%
Overnight Under 6 Months 6-12 Months 1 - 2 Years 2 - 3 Years
3 - 4 Years 4 - 5 Years 5 Years and Over
Notes:
1. Callable securities in portfolio are included in the maturity distribution analysis to their stated maturity date, although they may be called prior to maturity.
PFM Asset Management LLC Section B - 3
Village of North Palm Beach Investment Report - Quarter Ended December 31, 2011
Investment Portfolio Maturity Distribution versus the Benchmark'
35.0% 1
30.0% -
25.0%
20.0%
x
a 15.0% -
10.0%
5.0%
0.0%
1 L) h0 1�) oo oo '1`' ho Do ho ^`' Qo ^) o0 00
0 Z. o ti. ti ti ti 11V ti 1,1 ^)- ^, ^,- N_ I�K 1:1) -
Years to Maturity
❑ Investment Portfolio ❑Merrill Lynch 1 -3 Year U.S. Treasury Note Index
Notes:
1. Due to the nature of the security, Mortgage- Backed Securities are represented based on their average life maturity rather than their final maturity.
PFM Asset Management LLC Section B - 4
Village of North Palm Beach' Asset Allocation as of December 31, 2011*
Security Type
December 31, 2011
December 31, 2011
Notes Permitted by Policy
Florida SBA Prime Fund and Fund B
786,863.56
3.82%
2 25%
United States Treasury Securities
5,652,065.72
27.44%
100%
United States Government Agency Securities
-
0.00%
100%
Federal Instrumentalities
2, 081, 003.04
10.10%
50%
Certificates of Deposit
-
0.00%
100%
Repurchase Agreements
-
0.00%
0%
Commercial Paper
-
0.00%
0%
Corporate Notes
402,151.67
1.95%
25%
Mortgage - Backed Securities
-
0.00%
0%
Bankers' Acceptances
-
0.00%
0%
Money Market Mutual Funds
1,232,676.74
5.98%
50%
Intergovernmental Investment Pool
-
0.00%
25%
Interest Bearing Checking or Savings Account
10,444,653.33
50.70%
2 100%
Village Managed
$12,382,378.12
60.11%
Notes Permitted by Policy
PFM Managed
$8,217,035.94
39.89%
33%
Total
$20,599,414.06
100.00%
33%
Individual Issuer Breakdown
December 31, 2011
December 31, 2011
Notes Permitted by Policy
Government National Mortgage Association (GNMA)
-
0.00%
100%
US Export-Import Bank (Ex -Im)
-
0.00%
100%
Farmers Home Administration (FMHA)
-
0.00%
100%
Federal Financing Bank
-
0.00%
100%
Federal Housing Administration (FHA)
-
0.00%
100%
General Services Administration
-
0.00%
100%
New Communities Ad Debentures
-
0.00%
100%
US Public Housing Notes & Bonds
-
0.00%
100%
US Dept. of Housing and Urban Development
-
0.00%
100%
Federal Farm Credit Bank(FFCB)
276,744.74
1.34%
10%
Federal Home Loan Bank (FHLB)
560,215.21
2.72%
10%
Federal National Mortgage Association (FNMA)
540,496.98
2.62%
10%
Federal Home Loan Mortgage Corporation (FHLMC)
703,546.11
3.42%
10%
Student Loan Marketing Association (SLMA)
-
0.00%
0%
1. All Assets.
2. These Accounts are managed by the Village.
*PFM managed securities are shown on Amortized Cost plus Accrued Interest basis.
Asset Allocation
as of December 31, 2011
Money Market Mutual
Funds
Corporate Notes 5.98%
1.95
Interest Bearing Checking
Federal Instrumentalities or Savings Account
10.10% . - - - - -- 50.70%
United States Treasury -
Securities Florida SBA Prime Fund
27.44% and Fund B
3.82%
Individual Issuer Breakdown
December 31, 2011
December 31, 2011
Notes Permitted by Policy
CD - BankA
-
0.00%
33%
CD - BankB
-
0.00%
33%
Interest Bearing Checking or Savings Account - Wells Fargo
10,444,653.33
50.70%
2 50%
Interest Bearing Checking or Savings Account - B
-
0.00%
50%
Bank of America Corporate Notes - FDIC insured
402,151.67
1.95%
33%
Corporate Notes B
-
0.00%
33%
Corporate Notes C
-
0.00%
33%
Corporate Notes D
-
0.00%
33%
Corporate Notes E
-
0.00%
33%
Money Market Fund - TD Bank Sweep Account
81,815.51
0.40%
33%
Money Market Fund - Wells Fargo Advantage Fund
1,150,861.23
5.59%
2 33%
Florida Prime
543,249.81
2.64%
25%
SBA Fund B
243,613.75
1.18%
N/A
PFM Asset Management LLC Section C - 1
Add
� -1- -I Customer Service
PO Box 11813
Harrisburg, PA 17108 -1813
ACCOUNT STATEMENT
Client Management Team
Mel Hamilton
Senior Managing Consultant
300 South Orange Avenue, Suite 1170
Orlando, FL 32801
407 -648 -2208
hamiltonm @pfm.com
Steven Alexander, CTP, CGFO
Managing Director
300 South Orange Avenue, Suite 1170
Orlando, FL 32801
407 -648 -2208
alexanders @pfm.com
Gregg Manjerovic, CFA
Senior Portfolio Manager
One Keystone Plaza, Suite 300
Harrisburg, PA 17101
717- 232 -2723
manjerovicg @pfm.com
Rebecca Dole, CTP
Consultant
300 South Orange Street, Suite 1170
Orlando, FL 32801
407 -648 -2208
doler @pfm.com
Contents
Cover /Disclosures
Summary Statement
Individual Accounts
Accounts included in Statement
NORTH PALM BEACH INVESTMENT PORTFOLIO
Online Access www.pfm.com
VILLAGE OF NORTH PALM BEACH
SAMIA JANJUA
501 US HIGHWAY 1
NORTH PALM BEACH, FL 33408
Customer Service 1- 717 - 232 -2723
Mn
WF
Important Disclosures
This statement is for general information purposes only and is not
intended to provide specific advice or recommendations. PFM Asset
Management LLC ( "PFM ") is an investment advisor registered with the
Securities and Exchange Commission, and is required to maintain a
written disclosure statement of our background and business experience.
If you would like to receive a copy of our current disclosure statement,
please contact Service Operations at the address below.
Proxy Voting PFM does not normally receive proxies to vote on behalf of
its clients. However, it does on occasion receive consent requests. In the
event a consent request is received the portfolio manager contacts the
client and then proceeds according to their instructions. PFM's Proxy
Voting Policy is available upon request by contacting Service Operations
at the address below.
Questions About an Account PFM's monthly statement is intended to
detail our investment advisory activity as well as the activity of any
accounts held by clients in pools that are managed by PFM. The custodian
bank maintains the control of assets and executes (i.e., settles) all
investment transactions. The custodian statement is the official record of
security and cash holdings and transactions. PFM recognizes that clients
may use these reports to facilitate record keeping; therefore the custodian
bank statement and the PFM statement should be reconciled and
differences resolved. Many custodians use a settlement date basis which
may result in the need to reconcile due to a timing difference.
Account Control PFM does not have the authority to withdraw funds from
or deposit funds to the custodian. Our clients retain responsibility for their
internal accounting policies; implementing and enforcing internal controls
and generating ledger entries or otherwise recording transactions.
Market Value Generally, PFM's market prices are derived from closing bid
prices as of the last business day of the month as supplied by Interactive
Data, Bloomberg or Telerate. Where prices are not available from
generally recognized sources the securities are priced using a yield -based
matrix system to arrive at an estimated market value. Prices that fall
between data points are interpolated. Non - negotiable FDIC - insured bank
certificates of deposit are priced at par. Although PFM believes the prices
to be reliable, the values of the securities do not always represent the
prices at which the securities could have been bought or sold. Explanation
of the valuation methods for money market and TERM funds is contained
in the appropriate fund information statement.
Amortized Cost The original cost of the principal of the security is
adjusted for the amount of the periodic reduction of any discount or
premium from the purchase date until the date of the report. Discount or
premium with respect to short term securities (those with less than one
year to maturity at time of issuance) is amortized on a straightline basis.
Such discount or premium with respect to longer term securities is
amortized using the constant yield basis.
Important Disclosures
Tax Reporting Cost data and realized gains / losses are provided for
informational purposes only. Please review for accuracy and consult your
tax advisor to determine the tax consequences of your security transactions.
PFM does not report such information to the IRS or other taxing authorities
and is not responsible for the accuracy of such information that may be
required to be reported to federal, state or other taxing authorities.
Financial Situation In order to better serve you, PFM should be promptly
notified of any material change in your investment objective or financial
situation.
Callable Securities Securities subject to redemption prior to maturity may
be redeemed in whole or in part before maturity, which could affect the yield
represented.
Portfolio The securities in this portfolio, including shares of mutual funds,
are not guaranteed or otherwise protected by PFM, the FDIC (except for
certain non - negotiable certificates of deposit) or any government agency.
Investment in securities involves risks, including the possible loss of the
amount invested.
Rating Information provided for ratings is based upon a good faith inquiry of
selected sources, but its accuracy and completeness cannot be guaranteed.
Shares of some money market and TERM funds are marketed through
representatives of PFM's wholly owned subsidiary, PFM Fund Distributors,
Inc. PFM Fund Distributors, Inc. is registered with the SEC as a
broker /dealer and is a member of the Financial Industry Regulatory
Authority ( "FINRA ") and the Municipal Securities Rulemaking Board
( "MSRB "). You may reach the FINRA by calling the FINRA Regulator Public
Disclosure Hotline at 1 -888- 289 -9999 or at the FINRA Regulation Internet
website address www.nasd.com. A brochure describing the FINRA
Regulation Public Disclosure Program is also available from the FINRA
upon request.
Key Terms and Definitions
Dividends on money market funds consist of interest earned, plus any
discount ratably amortized to the date of maturity, plus all realized gains and
losses on the sale of securities prior to maturity, less ratable amortization of
any premium and all accrued expenses to the fund. Dividends are accrued
daily and may be paid either monthly or quarterly. The monthly earnings on
this statement represent the estimated dividend accrued for the month for
any program that distributes earnings on a quarterly basis. There is no
guarantee that the estimated amount will be paid on the actual distribution
date.
Current Yield is the net change, exclusive of capital changes and income
other than investment income, in the value of a hypothetical fund account
with a balance of one share over the seven -day base period including the
statement date, expressed as a percentage of the value of one share
(normally $1.00 per share) at the beginning of the seven -day period. This
resulting net change in account value is then annualized by multiplying it by
365 and dividing the result by 7. The yields quoted should not be considered
a representation of the yield of the fund in the future, since the yield is not
fixed.
Account Statement
For the Month Ending December 31, 2011
Average maturity represents the average maturity of all securities and
investments of a portfolio, determined by multiplying the par or
principal value of each security or investment by its maturity (days or
years), summing the products, and dividing the sum by the total
principal value of the portfolio. The stated maturity date of mortgage
backed or callable securities are used in this statement. However the
actual maturity of these securities could vary depending on the level or
prepayments on the underlying mortgages or whether a callable
security has or is still able to be called.
Monthly distribution yield represents the net change in the value of one
share (normally $1.00 per share) resulting from all dividends declared
during the month by a fund expressed as a percentage of the value of
one share at the beginning of the month. This resulting net change is
then annualized by multiplying it by 365 and dividing it by the number of
calendar days in the month.
YTM at Cost The yield to maturity at cost is the expected rate of return,
based on the original cost, the annual interest receipts, maturity value
and the time period from purchase date to maturity, stated as a
percentage.
YTM at Market The yield to maturity at market is the rate of return,
based on the current market value, the annual interest receipts,
maturity value and the time period from purchase date to maturity,
stated as a percentage.
Managed Account portfolio of investments managed discretely by
PFM according to the client's specific investment policy and
requirements. The investments are directly owned by the client and
held by the client's custodian.
Unsettled Trade A trade which has been executed however the final
consummation of the security transaction and payment has not yet
taken place.
Please review the detail pages of this statement carefully. If you think
your statement is wrong, missing account information, or if you need
more information about a transaction, please contact PFM within 60
days of receipt. If you have other concerns or questions regarding your
account you should contact a member of your client management team
or PFM Service Operations at the address below.
PFM Asset Management LLC
Attn: Service Operations
One Keystone Plaza, Suite 300
N. Front & Market Sts
Harrisburg, PA 17101
.y :
Managed Account Summary Statement For the Month Ending December 31, 2011
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Transaction Summary - Managed Account Cash Transactions Summary - Managed Account
Opening Market Value $8,184,331.27 Maturities /Calls 0.00
Maturities /Calls 0.00 Sale Proceeds 825,280.66
Principal Dispositions (824'178'27) Coupon /Interest Income 7,838.04 Principal Payments 0.00
Principal Acquisitions 817,846.88
Unsettled Trades 0.00 Security Purchases (820,734.99)
Change in Current Value (2,855.68) Net Cash Contribution 0.00 Reconciling Transactions 0.00
Closing Market Value $8,175,144.20
Earnings Reconciliation (Cash Basis) - Managed Account Cash Balance
Interest /Coupons Received 8,940.43 Closing Cash Balance $81,815.51
Less Purchased Interest Related to Interest /Coupons (2,888.11)
Plus Net Realized Gains /Losses (3,296.17)
Total Cash Basis Earnings $2,756.15
Ending Amortized Value of Securities
8,118,964.77
Ending Accrued Interest
16,255.66
Plus Proceeds from Sales
825,280.66
Plus Proceeds of Maturities /Calls /Principal Payments
0.00
Plus Coupons Received
7,838.04
Less Cost of New Purchases
(820,734.99)
Less Beginning Amortized Value of Securities
(8,123,825.27)
Less Beginning Accrued Interest
(15,322.00)
Total Accrual Basis Earnings $8,456.87
�
NI Account 61350001 Page 1
WF PFM Asset Management LLC
=` Nt
Portfolio Summary and Statistics
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Description
Par Value
Market Value
Percent
U.S. Treasury Bond / Note
5,630,000.00
5,677,385.16
69.44
U.S. Government Supported Corporate
400,000.00
402,734.00
4.93
Debt
Federal Agency Bond / Note
2,060,000.00
2,095,025.04
25.63
Managed Account Sub -Total
8,090,000.00
8,175,144.20
100.00%
Accrued Interest
16,255.66
Total Portfolio
8,090,000.00
8,191,399.86
Unsettled Trades
Maturity Distribution
0.00 0.00
0 - 6 Months 6 - 12 Months 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years Over 5 Years
US TSY Bond / Note
69.44%
For the Month Ending December 31, 2011
Fed Agy Bond /
Note
25.63%
JS Govt Supported
Corp Debt
4.93%
Yield to Maturity at Cost 0.81%
Yield to Maturity at Market 0.29%
Duration to Worst 1.73
Weighted Average Days to Maturity 637
A=PFLI` Account 61350001 Page 2
uPFM Asset Management LLC
�ff
W-T Managed Account Issuer Summary
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Issuer
Market Value
of Holdings
Percent
BANK OF AMERICA CORP TLGP
402,734.00
4.93
FANNIE MAE
545,586.30
6.67
FEDERAL FARM CREDIT BANKS
275,869.88
3.37
FEDERAL HOME LOAN BANKS
567,101.66
6.94
FREDDIE MAC
706,467.20
8.64
UNITED STATES TREASURY
5,677,385.16
69.45
Total $8,175,144.20 100.000/0
AA+
100.00%
For the Month Ending December 31, 2011
PFM Asset Management LLC
Account 61350001 Page 3
Managed Account Detail of Securities Held For the Month Ending December 31, 2011
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Security Type/ Description
S &P
Moody's
Trade
Settle
Original
YTM
Accrued
Amortized
Market
Dated Date /Coupon /Maturity
U.S. Treasury :. Note
CUSIP
Par
Rating
Rating
Date
Date
Cost
at Cost
Interest
Cost
Value
US TREASURY NOTES
330,000.00
AA+
Aaa
10/27/11
10/31/11
330,141.80
0.49
351.64
330,133.66
331,366.53
DTD 10/15/20110.500% 10/15/2014
Security Type Sub -Total 5,630,000.00 5,643,068.77 0.68 8,352.96 5,643,712.76 5,677,385.16
Supported U.S. Government . ..
PF'I1, Account 61350001 Page 4
PFM Asset Management LLC
Managed Account Detail of Securities Held For the Month Ending December 31, 2011
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Security Type/ Description S &P Moody's Trade Settle Original YTM Accrued Amortized Market
Dated Date /Coupon /Maturity CUSIP Par Rating Rating Date Date Cost at Cost Interest Cost Value
U.S. Government Supported Corporate Debt
BANK OF AMERICA CORP (FDIC) GLOBAL 400,000.00 AA+ Aaa 12/29/09 12/30/09 405,171.20 1.53 1,423.33 400,728.34 402,734.00
MTN
DTD 01/30/2009 2.100% 04/30/2012
Security Type Sub -Total
Federal Agency :. Note
2,060,000.00
400,000.00
1.03
6,479.37
2,074,523.67
2,095,025.04
405,171.20
1.53
1,423.33
400,728.34
402,734.00
05/20110.750% 09/22/2014
Security Type Sub -Total
2,060,000.00
2,077,998.60
1.03
6,479.37
2,074,523.67
2,095,025.04
Managed Account Sub -Total
8,090,000.00
8,126,238.57
0.81
16,255.66
8,118,964.77
8,175,144.20
Securities Sub -Total
$8,090,000.00
$8,126,238.57
0.81%
$16,255.66
$8,118,964.77
$8,175,144.20
Accrued Interest $16,255.66
Total Investments
$8,191,399.86
PFII. Account 61350001 Page 5
WF PFM Asset Management LLC
� 1FN,
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2011
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Security Type/ Description
Next Call Market
Market
Unreal G/L
Unreal G/L
Duration
YTM
Dated Date /Coupon /Maturity
U.S. Treasury :. Note
CUSIP
Par
Broker
Date Price
Value
On Cost
Amort Cost
to Worst
at Mkt
US TREASURY NOTES
330,000.00
BARCLAYS
100.41
331,366.53
1,224.73
1,232.87
2.77
0.35
DTD 10/15/20110.500% 10/15/2014
Security Type Sub -Total 5,630,000.00 5,677,385.16 34,316.39 33,672.40 1.75 0.24
Supported U.S. Government .. D•.
-%I:- -
�PFNI` Account 61350001 Page 6
PFM Asset Management LLC
PFM'.
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2011
NORTH PALM BEACH INVESTMENT PORTFOLIO 61350001
Security Type/ Description Next Call Market Market Unreal G/L Unreal G/L Duration YTM
Dated Date /Coupon /Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost to Worst at Mkt
Supported U.S. Government .. D•.
BANK OF AMERICA CORP (FDIC) GLOBAL 400,000.00 BARCLAYS 100.68 402,734.00 (2,437.20) 2,005.66 0.33 0.05
MTN
DTD 01/30/2009 2.100% 04/30/2012
Security Type Sub -Total
400,000.00
402,734.00
(2,437.20)
2,005.66
0.33
0.05
Federal Agency :. Note
05/20110.750% 09/22/2014
Security Type Sub -Total
Managed Account Sub -Total
2,060,000.00
8,090,000.00
2,095,025.04 17,026.44
8,175,144.20 48,905.63
20,501.37 1.94 0.45
56,179.43 1.73 0.29
Securities Sub -Total $8,090,000.00 $8,175,144.20 $48,905.63 $56,179.43 1.73 0.29%
Accrued Interest $16,255.66
Total Investments $8,191,399.86
Account 61350001 Page 7
PFM Asset Management LLC
Managed Account Security Transactions & Interest For the Month Ending December 31, 2011
NORTH PALM BEACH INVESTMENT PORTFOLIO - 61350001
Transaction Type Principal Accrued Realized G/L Realized G/L Sale
Trade Settle Security Description CUSIP Par Proceeds Interest Total Cost Amort Cost Method
12/02/11 12/06/11 US TREASURY NOTES
490,000.00 0.00 3,675.00 3,675.00
DTD 12/31/2008 1.500% 12/31/2013
Transaction Type Sub -Total 1,500,000.00 0.00 7,838.04 7,838.04
12/02/11 12/06/11 FFCB BONDS (FLOATING)
490,000.00 493,964.10 1,041.25 495,005.35 (3,577.00) 2,659.60 SPEC LOT
DTD 01/30/2009 2.125% 04/30/2012
Transaction Type Sub -Total 820,000.00 824,178.27 1,102.39 825,280.66 (3,296.17) 2,885.44
Managed Account Sub -Total 6,331.39 6,052.32 12,383.71 (3,296.17) 2,885.44
Total Security Transactions $6,331.39 $6,052.32 $12,383.71 ($3,296.17) $2,885.44
41' Account 61350001 Page 8
PFM Asset Management LLC: