TREASURER JOSÉ CISNEROS ANNOUNCES $80 MILLION ‘SAFE, SOUND AND LOCAL’ INVESTMENT OPPORTUNITY FOR BANKS, CREDIT UNIONS AND COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS

Thursday, October 05, 2017

Treasurer José Cisneros announced he will make up to $80 million of the County’s Pooled Investment Fund available over the next year for investments in banks, credit unions and community development financial institutions (CDFIs) located in San Francisco that are backed by letters of credit issued by the Federal Home Loan Bank of San Francisco.

“Safe, Sound and Local is a unique opportunity to safely put our City’s money to work in our local economy,” said Treasurer José Cisneros. “This program will provide a stable source of funding for our local credit unions, banks and CDFIs operating in San Francisco so they can continue to provide critical loans that support our City.”

This new offering is modeled after the Time Deposit program of the California State Treasurer’s Office. Investments are backed by a letter of credit guarantee from the Federal Home Loan Bank of San Francisco (FHLBank San Francisco), a cooperative, wholesale bank that helps meet community credit needs by providing readily available, competitively priced credit products and services to member financial institutions through all phases of the economic cycle. FHLBank San Francisco members include commercial banks, credit unions, industrial loan companies, savings institutions, insurance companies, and community development financial institutions headquartered in Arizona, California, and Nevada.

“We are delighted at this opportunity to support our members in making a greater contribution to our hometown. The Treasurer’s Safe, Sound and Local program will ultimately provide credit that enables community lenders to make home mortgage, commercial real estate, small business, and other loans,” says Greg Seibly, President and Chief Executive Officer of the Federal Home Loan Bank of San Francisco.

This new investment offering supplements the Office’s existing Certificates of Deposit Program, whereby the Treasurer invests up to $240,000 in FDIC -insured CDs with firms having at least one branch office within the boundaries of the City and County of San Francisco. Both offerings enable local financial institutions an opportunity to receive substantial deposits through a stable source of funding, and will have the same pricing. By limiting access to institutions that have at least one branch in San Francisco, the increased investments allow for re-investment in the San Francisco communities they serve.

“As long-time participants in the State’s program, we are thrilled to see Treasurer Cisneros launch Safe, Sound and Local, and we plan to participate enthusiastically,” said Ed Obuchowski, CEO and Director, Bank of San Francisco. “We started Bank of San Francisco to identify needs in our community and develop and provide the services necessary to meet those needs. Whether helping with the purchase of a business, growing a nonprofit or taking out a mortgage on a first home, we will be using the City’s dollars to further our mission to enhance the success of our communities.”

The Charter of the City and County of San Francisco makes it the responsibility of the Treasurer to safely invest the City’s cash and have money available to pay the City’s bills while earning a reasonable return. The Treasurer’s Pool (the “Pool”) holds monies received from City departments and external agencies such as the Unified School District and City College. These funds are encumbered for specific purposes, but are invested by the Treasurer until required for use. Investments are made in strict adherence to state law, which places the highest value on the safety of funds, with secondary consideration for security and yield. As of August 31, 2017, the Pooled Fund Portfolio had a balance of $8,201,300,000 in market value.

“We are always looking for prudent investment opportunities for the City and County’s funds that are safe, receive a competitive yield, and meet the liquidity needs of our Pooled Fund participants so that they can fund critical public services,” said Robert Shaw, Chief Investment Officer for the City and County of San Francisco. “With the credit support provided by the Federal Home Loan Bank of San Francisco, these investments can provide an additional source of portfolio diversification for the Pool while continuing to meet all of the requirements of both state and local laws.”

Financial institutions interested in applying should visit http://sftreasurer.org/safe-sound-and-local for more information.

About Treasurer José Cisneros

José Cisneros is the Treasurer for the City and County of San Francisco. As Treasurer, he serves as the City's banker and chief investment officer, managing all tax and revenue collection for San Francisco. Treasurer Cisneros believes that his role of safeguarding the City’s money extends to all San Francisco residents, and continues to expand his role as a financial educator and advocate for low-income San Franciscans through award-winning programs like Kindergarten to College and Bank On San Francisco. Cisneros was a member of the FDIC’s Advisory Committee on Economic Inclusion, served as Vice Chair on the President’s Advisory Council on Financial Capability for Young Americans, and is the Co-Chair of the Cities for Financial Empowerment Coalition.