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Chief Financial Officer's (CFO) Report to the Board

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II. Investments Results - Second Quarter 2013

DIF Investment Portfolio

  • On June 30, 2013, the total liquidity (also total market value) of the DIF investment portfolio stood at $34.2 billion, lower than its December 31, 2012, balance of $38.2 billion.  The DIF investment portfolio would have increased by $1.8 billion, primarily due to receipts of receivership dividends and regular quarterly deposit insurance assessments, if it had not been for a partial refund of prepaid assessments in the amount of $5.9 billion in the second quarter.
  • On June 30, 2013, the DIF investment portfolio’s yield was 0.34 percent, down two basis points from its December 31, 2012, yield of 0.36 percent.  During the first half of the year, newly purchased Treasury securities generally had somewhat lower yields than maturing securities, resulting in the modest decrease in portfolio yield.
  • In accordance with the approved second quarter 2013 DIF portfolio investment strategy, staff purchased a total of nine short-maturity conventional Treasury securities and one Treasury Inflation-Protected Security (TIPS).  The ten securities had a total par value of $6.0 billion, a weighted average yield of 0.44 percent, and a weighted average maturity (WAM) of 2.11 years.

DIF Investment Portfolio Total Yield

DIF Investment Portfolio Total Yield (percentage)
  Year-end
Percentage
2008
4.59%
2009 0.49%
2010 0.40%
2011 0.41%
2012 0.36%
Jun-2013 0.34%

The decline in the DIF portfolio 's yield beginning in 2009 reflects: 1) the sale of older, higher-yielding securities to fund significant resolution outlays during the latter half of 2008 and 2009; and 2) beginning in 2010, the reinvestment of newly available funds in short-maturity securities in a historically low yield environment.

 



Last Updated 08/29/2013 dofbusinesscenter@fdic.gov

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