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

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Investment Strategies - Fourth Quarter 2009

Deposit Insurance Fund

Strategy as of 4th Quarter 2009

Invest all proceeds from deposit insurance assessments, Temporary Liquidity Guarantee Program surcharges, maturing securities, coupon and other interest payments, and receivership dividends in overnight investments and/or in short-term Treasury bills in anticipation of using such funds for resolution activities.

Strategy Changes for 1st Quarter 2010

Purchase up to $25 billion (par value) of available-for-sale (AFS) securities with maturity dates between April 1, 2010, and December 31, 2010, subject to the following additional restrictions: no more than $20 billion (par value) of such securities shall have maturity dates beyond June 30, 2010; and no more than $10 billion (par value) of such securities shall have maturity dates beyond September 30, 2010.

Debt Guarantee Program
Other Systemic Risk Reserves

Strategy as of 4th Quarter 2009

For the Debt Guarantee Program portfolio, in anticipation of potentially using these funds on an as needed basis to fund DIF resolutions, all funds will be invested in overnight investments and/or short-term Treasury bills. For the Other Systemic Risk Reserves portfolio, strategically invest all available funds in overnight investments and/or in conventional or callable Treasury securities with effective maturity dates not to exceed December 31, 2012.

Strategy as of 1st Quarter 2010

For the Debt Guarantee Program portfolio, purchase up to $3 billion (par value) of AFS securities with maturity dates between April 1, 2010, and December 31, 2010. For the Other Systemic Risk Reserves portfolio, there is no first quarter 2010 strategy because all of the portfolio's funds were transferred to the DIF portfolio on January 7, 2010 (effective as of December 31, 2009).

National Liquidation Fund

Strategy as of 4th Quarter 2009

Maintain an overnight deposit balance within a target range of $15 million to $25 million.

Strategically invest the remaining funds in the zero- to 12-month maturity sector.

Strategy Changes for 1st Quarter 2010

Maintain an overnight deposit target floor balance within a range of $15 million to $25 million.




Last Updated 04/14/2010 dofbusinesscenter@fdic.gov

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