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CITY OF LITTLE CANADA, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2015 (50) NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED) C. Investments The City has the following investments at year-end: Total Fair Value Less than 1 1-5 More than 5 Rating Agency US Agencies: Federal Home Loan Bank Mtg. Corp. Step Up 464,357$ -$ -$ 464,357$ AA+ Moody's/S&P Federal Farm Credit Bank Bonds 834,760 - - 834,760 AA+ Moody's/S&P Municipal Bonds 344,373 - 344,373 - AA+ Moody's/S&P Municipal Bonds (1)1,530,000 - - 1,530,000 N/A N/A Negotiable Certificates of Deposit 3,996,810 400,922 2,839,521 756,367 N/A N/A Mutual Fund 1,311,567 1,311,567 - - N/A N/A Money Market 2,978,876 2,978,876 - - N/A N/A MN Municipal Money Market (4M)3,216,763 3,216,763 - - N/A N/A 14,677,506$ 7,908,128$ 3,183,894$ 3,585,484$ N/R indicates "not rated" N/A indicates "not applicable" (1) Internal investment in the City of Little Canada Tax Increment Bonds of 2001A, which are not rated. Interest - Risk: Maturity in Years Credit Risk Investments are subject to various risks, the following of which are considered the most significant: Custodial Credit Risk – For investments, this is the risk that in the event of a failure of the counterparty to an investment transaction (typically a broker-dealer) the City would not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The City’s investment policy does not address custodial credit risk. However, investments in securities are held by the City’s broker-dealers of which $1,500,000 is insured through SIPC. The broker-dealers have provided additional protection by providing additional insurance. This insurance is subject to aggregate limits applied to all of the broker-dealer’s accounts.