Reso 2014-2242 - Laserfiche WebLink

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2. While Citibank offers a higher interest rate on excess balances, 0.25% versus 0.20% offered by TD Bank, this is only beneficial to the City if it keeps the majority of its excess balances (above balances required to pay fees under the earnings credit arrangements being offered) in a Citibank money market account. The breakeven point in which both banks produce the same net interest earnings (gross interest earnings less bank fees) is at $8.5 million. Finance staff have been investigating other investment vehicles which have the potential to earn more than 0.25 %. This would include a mix of certificates of deposit with short terms (i.e. one year or less), bonds, money market -type funds and additional treasuries in accordance with the City's investment policy. It is the intention of the Finance staff to significantly reduce funds remaining on deposit with our banking institution to enable the City to obtain a higher earnings yield than was offered by any of the institutions responding to the RFP. 3. TD Bank has a local presence in South Florida which includes a local branch in Sunny Isles Beach and a local relationship manager. Citibank does not have a local presence (New York based), the relationship manager we believe we will be dealing with is located in Philadelphia, PA, and the closest branch is in Aventura, FL. Based upon this local presence, we believe the City will have an opportunity to partner with TD Bank in order to create a relationship better suited to its needs. 4. TD Bank has several local municipalities as clients which shows they have experience in understanding our City's operations and its complexities. Citibank was not able to provide any local municipalities as references and based upon conversations with colleagues, they do not have a significant client base of municipal governments. 5. TD Bank has several clients that are using Edmunds MCSJ, the new ERP financial software that the City will be implementing October 1, 2014. They have worked with the software since 1994 and have created standard TD Bank file specifications for exporting to the financial system. 6. When comparing the financial strength of the two institutions, both are very large national institutions with strong financial positions. However, historically, it appears TD operates at a more conservative level. Citibank required a large bailout in 2008 from the federal government. Please let us know if you have any questions.