N.J. Admin. Code § 17:4A-13.1

Current through Register Vol. 56, No. 21, November 4, 2024

Section 17:4A-13.1 - Permissible investments

(a) Subject to the limitations in this subchapter, the Board may invest and reinvest the PRFSNJ-managed fund assets in repurchase agreements, provided that:

1. The seller is a bank or trust company or a wholly owned subsidiary of such bank or trust company that:

i. Is headquartered in the United States; and

ii. Is a member of the Federal Reserve System;

2. The seller is a securities broker that:

i. Is headquartered in the United States;

ii. Is registered with the Securities and Exchange Commission; and

iii. Meets the criteria for issuers of commercial paper as specified at N.J.A.C. 17:4A-11;

3. The seller demonstrates the capacity to wire collateral against payment through the Federal Reserve System to a designated custodian bank;

4. The security subject to repurchase is:

i. An obligation of the United States Government;

ii. An obligation of a United States Government agency eligible for investment pursuant to N.J.A.C. 17:4A-5;

iii. A collateralized note or mortgage or mortgage-backed security eligible for investment pursuant to N.J.A.C. 17:4A-8 or 17, respectively; or

iv. A corporate obligation with a credit rating of at least: P-1 or higher by Moody's Investors Service, Inc., A-1 or higher by Standard & Poor's Corporation, and F-1 or higher by Fitch Ratings, except that two of the three ratings is sufficient and one of the three ratings is sufficient if only one rating is available;

5. The maturity of the repurchase agreement shall not exceed 30 days;

6. The market value of the securities delivered pursuant to the repurchase agreement shall be equal to at least 102 percent of the par value of the repurchase agreement; and

7. The securities delivered pursuant to the repurchase agreement shall have a maturity not exceeding 10 years from the date of the repurchase agreement.

(b) Notwithstanding the restrictions in this subchapter, the Board may authorize the purchase of repurchase agreements on a case-by- case basis if the Board determines such purchase to be in the financial best interest of the PFRSNJ and its beneficiaries and is consistent with the Board's fiduciary responsibility.

N.J. Admin. Code § 17:4A-13.1

Adopted by 53 N.J.R. 1147(a), effective 7/6/2021

Recodified from 17:4A-13.2 by 56 N.J.R. 795(a) effective 5/6/2024