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Page 2 of 6 <br /> <br />Local Agency Investment Fund <br />The City's investment in the Local Agency Investment Fund (LAIF) increased to $66.5 million <br />from $56.5 million last quarter ending December 31, 2025. The quarterly LAIF apportionment <br />interest rate was 3.98 percent with an ADM of 261 days. The average monthly effective yield <br />was 3.83 percent in March, 3.87 percent in February, and 3.93 percent in January. The <br />average monthly effective yield for the nine months ended March 31, 2026 is 4.07 percent. <br /> <br />The returns for the two Certificates of Deposit with Fremont Bank and United Business <br />Bank are 3.30 percent and 4.15 percent, respectively. <br /> <br />Asset Composition <br />As of March 31, 2026, approximately 17.5 percent of the total portfolio consisted of Federal <br />Agency Issues, while the LAIF Investment was 25.5 percent of the portfolio. Corporate Notes <br />accounted for 15.4 percent of the portfolio, Treasury Securities 36.6 percent, Government <br />Money Market and Cash 0.2 percent, Supranationals 1.2 percent, Asset-Backed Securities 3.4 <br />percent, and Certificates of Deposit 0.2 percent. <br /> <br />Table 1. Asset Composition <br /> <br />As of March 31, 2026, the entire portfolio, exclusive of CDs and LAIF was held in third-party <br />safekeeping for the benefit of the City of Pleasanton at Bank of New York Mellon. Bank of New <br />York Mellon is a contractual agent for the City. <br /> <br />As of March 31, 2026, all investments in the portfolio are authorized by State of California <br />Government Section 53600 et. Seq. and the City's investment policy. <br /> <br />Economic Update Highlights <br />The following are some highlights from the Economic Update included in the Investment <br />Report prepared by Chandler Asset Management in Attachment 1. <br /> <br />The Federal Reserve has held the funds rate at 3.50–3.75% and is signaling a cautionary <br />stance, keeping open the option of delaying cuts if oil-related inflation proves persistent rather <br />than transitory. As the data flow normalizes, the Chandler team anticipates additional yield <br />curve steepening as the Federal Reserve gradually guides the policy rate toward a more <br />Page 260 of 908