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Georgetown council approves $2.2 million reinvestment into longer‑term securities
Summary
Council approved a municipal order to reinvest roughly $2.2 million of matured funds through Stockyards Bank into taxable municipal/agency securities with 2–7 year maturities, aiming for higher yields while staff said liquidity would remain available if needed.
Georgetown City Council voted to reinvest about $2.2 million of matured securities held at Stockyards Bank into longer‑term municipal and agency securities during its Nov. 24 meeting.
Stacy, the city's finance staffer, told the council the funds were available because certain investments had matured and the city did not need immediate liquidity from that account. The investment plan calls for buying roughly $250,000 tranches across 2‑ to 7‑year maturities and rests on what staff described as permissible options under KRS 66.48. Owen Armand, an account manager with Stockyards Bank, told the council these agency securities are treated as “risk free spread opportunities to treasuries” and said the targeted yields were in the 4–4.5% range compared with recent treasury yields of roughly 3.4–3.7%.
Council members asked how the reinvestment would affect the city’s reserve policy. Stacy said the proposed purchases would not reduce the city’s minimum fund‑balance calculation and that, if necessary, the securities could be sold in a liquid market, though selling before a coupon date could forgo some accrued interest. The council moved and approved the municipal order by voice vote.
The council packet included sample screenshots of securitizations and a comparison to treasury yields; staff emphasized the purchases would comply with the city’s investment policy and applicable Kentucky revised statutes. The city will execute purchases on the market day with prices and available issues reflecting the market on that date.
