File #: 12-434    Name: Bank Depository Extension
Type: Resolution Status: Approved
In control: City Council Regular Meeting
On agenda: 6/19/2012 Final action: 6/19/2012
Title: Consider/Discuss/Act on a Resolution to Extend the American National Bank Depository Contract
Attachments: 1. Resolution
Title
Consider/Discuss/Act on a Resolution to Extend the American National Bank Depository Contract
 
Summary
 
MEETING DATE:      June 19, 2012
 
DEPARTMENT:       Finance
 
CONTACT:        Rodney Rhoades, Finance Director
 
RECOMMENDED CITY COUNCIL ACTION:      
·      Adopt the Resolution.
 
ITEM SUMMARY:  
·      The existing three-year depository contract for the custody of City funds with American National Bank (ANB) expires June 30, 2012 and allows for two one-year extensions.
·      Staff is satisfied with American National Bank's performance and recommends an extension of the current contract with mutually agreed upon provisions.
 
BACKGROUND INFORMATION:  
  • Section 105.017 of the Local Government Code states that a municipality may approve, execute, and deliver any depository service contract whose term does not exceed five years.
  • All pertinent requirements comply with Section 110 of the City of McKinney City Charter and Section 105.017 of the Local Government Code.
 
FINANCIAL SUMMARY:  
·      All contract terms remain as stated in the original contract with the exception of :
o      ANB will provide all banking services and safekeeping at no cost in lieu of an average $20 million in Collected Non-Interest Bearing Compensating Balance Accounts
o      City will maintain an investment account not to exceed $20 million at  ANB's Public Fund Money Market Rate plus 25 basis points, with a floor of .30%
 
 
Current Agreement
1 Year Extension
Interest
155 bp above the Federal Rate  (currently 1.81%)
25 bp above ANB's Public Fund MM Rate only on investment account (currently .30%)
Banking Fees
None
None
Safekeeping Fees
None
None
Pledged Securities
$30 million on interest bearing operating accounts
$40 million (50/50 split of non-interest bearing accounts and investment account)
 
BOARD OR COMMISSION RECOMMENDATION:    N/A