investment performance review for the quarter ended

Investment Advisors

One Keystone Plaza, Suite 300North Front & Market Streets

Harrisburg, PA 17101-2044717.232.2723

717.233.6073 fax

PFM Asset Management LLC

300 South Orange AvenueSuite 1170

Orlando, FL 32801407.648.2208

407.648.1323 fax

Investment Performance Review For the Quarter Ended September 30, 2017

Steven Alexander, CTP, CGFO, CPPT, Managing DirectorRobert Cheddar, CFA, Chief Credit Officer, Managing DirectorBarry Baughier, Senior Managing ConsultantRebecca Geyer, CTP, Senior AnalystCody Raulerson, Analyst

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CITY OF ROWLETT, TEXAS

For the Quarter Ended September 30, 2017

Table of Contents


Tab I

Market Update

Tab II

Executive Summary

Pooled Funds

Long Term Pooled Funds

Tab III

Asset Allocation Chart

Important Disclosures

2 of 52

Tab I


3 of 52

QUARTERLY MARKET SUMMARYFor the Quarter Ended September 30, 2017

Fixed Income Management

S U M M A R Y• For the first time since 2007, all 45 national economies in the OECD (Organisation

for Economic Co-operation and Development) are expanding. Against the backdropof historically low interest rates, reasonably favorable economic data, and positiveconsumer, business and investor optimism, the U.S. economy is on track to grow ata modest pace in the range of 2% to 2.5% annually.

• Although a slow rate of inflation remains a conundrum, the Federal Reserve (Fed)is pursuing monetary policy normalization. At its September meeting, the FederalOpen Market Committee (FOMC) announced a tapering of its balance sheetsecurities holdings to begin in October under the terms of the previously releasednormalization principles and plans. In addition, the updated “dot plot” projectionindicated an expectation for one additional rate hike in 2017.

• Slow progress on the policy front in Washington has somewhat temperedinvestors’ earlier exuberance, but markets retain an air of complacency. Numerousgeopolitical risks loom, however, including mounting nuclear tensions with NorthKorea, trade issues related to NAFTA and China, border and immigration issues,ongoing conflicts with Russia, and “Brexit” implementation in the UK.

• U.S. equity markets marched to new heights with the S&P 500 rising 4.5%during the quarter. All three major U.S. indices booked record highs, with thetelecommunications, information technology, and energy sectors in the lead.

E C O N O M I C S N A P S H O T• Second quarter gross domestic product (GDP) accelerated to an annualized

growth rate of 3.1%, up from the prior quarter’s 1.4% pace. Consumer spendingand business investment led the increase. Heavy Gulf Coast damage from recenthurricanes are expected to handicap near-term growth and create “noise” inupcoming economic data, but weather-related impacts are usually transitory.

• The U.S. economy added less than 100,000 jobs per month (on average) in thethird quarter, but the unemployment rate fell to 4.2%, the lowest rate since 2001.Jobless claims spiked following the hurricane disruption, but the uptick is expectedto be temporary. In a positive sign, wage growth rose 2.9% year-over-year throughSeptember, but may also have been distorted by the hurricanes.

• Inflationary pressures remained subdued. The personal consumption expendituresprice index, excluding food and energy (core PCE) rose only 1.3% year-over-yearin August, well short of the Fed’s 2% target, the explanation for which continues toelude Fed officials. Absent evidence that the weakness is permanent, however, theFed’s outlook remains stable.

• On the global front, growth in Europe has picked up, with unemployment in somecountries at record lows, while inflation (outside the UK) remains very muted.

I N T E R E S T R A T E S• Shorter-term Treasury yields (five years and under) rose in the third quarter on

the expectation of further monetary policy tightening. Long-term Treasury yields(10 years and longer) rose just a couple basis points. This continued the trend ofmodest flattening of the Treasury yield curve since the beginning of the year.

• The two-year Treasury yield ended the quarter higher by 11 basis points (bps)(0.11%) to 1.49% -- the highest level since 2008 – while the 10-year Treasury yieldrose only 2 bps (0.02%) over the quarter to close at 2.33%.

• In the money market space, federal debt ceiling concerns resulted in a temporaryinversion of the short-term yield curve. The higher risk associated with Treasuriesmaturing in early October, the expected date for the U.S. Treasury to run out ofborrowing capacity, translated into higher yields for those maturities. But, the yieldcurve quickly normalized after Congress passed an extension to the debt limit untilDecember, along with a hurricane aid package, and a temporary resolution to fundthe government for three months.

• In the short-term credit markets, yields on commercial paper and bank CDs rose inlockstep with expectations about future Fed rate hikes.

S E C T O R P E R F O R M A N C E• U.S Treasury index returns were positive for the third quarter. Flattening of the yield

curve caused longer maturities to outperform shorter ones, as the increase in short-term rates modestly detracted from returns for the quarter.

• Federal agencies outperformed comparable-maturity Treasuries, as the sector’salready-narrow yield spreads tightened even further on the back of limited supplyand persistent investor demand.

• Corporate yield spreads continued tightening, generating outperformance overcomparable-maturity Treasuries for the quarter and even more so year-to-date.Strong earnings growth and balance sheets continue to provide a good foundationfor the sector. Yield spreads are narrow, which limits their upside, but theincremental income on corporates is an important contributor to incremental return.

• After three straight quarters of underperformance, the mortgage backed securities(MBS) sector performed well in the third quarter, outperforming Treasuries andtraditional agencies.

• High quality asset-backed securities (ABS) also performed positively relative toTreasuries. Further spread compression in the ABS sector is likely to be limited,given that current level spreads sit at historic tights.

• Short-term commercial paper and bank CDs continue to offer value relative to bothshort and intermediate-term government securities.


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Economic Snapshot

Labor Market Jun '17 Sep '16

Unemployment Rate Sep'17 4.2% 4.4% 4.9%

Change In Non-Farm Payrolls Sep'17 -33,000 210,000 249,000

Average Hourly Earnings (YoY) Sep'17 2.9% 2.5% 2.7%

Personal Income (YoY) Aug'17 2.8% 2.7% 2.4%

Initial Jobless Claims (week) 10/7/17 243,000 250,000 247,000

Growth

Real GDP (QoQ SAAR) 2017Q2 3.1% 1.2% 2.2%

GDP Personal Consumption (QoQ SAAR) 2017Q2 3.3% 1.9% 3.8%

Retail Sales (YoY) Sep'17 4.4% 3.0% 3.1%

ISM Manufacturing Survey (month) Sep'17 60.8 57.8 51.7

Existing Home Sales SAAR (month) Aug'17 5.35 mil. 5.51 mil. 5.47 mil.

Inflation / Prices

Personal Consumption Expenditures (YoY) Aug'17 1.4% 1.4% 1.4%

Consumer Price Index (YoY) Sep'17 2.2% 1.6% 1.5%

Consumer Price Index Core (YoY) Sep'17 1.7% 1.7% 2.2%

Crude Oil Futures (WTI, per barrel) Sep 30 $51.67 $46.04 $48.24

Gold Futures (oz.) Sep 30 $1,282 $1,242 $1,313

Latest

-150K

0

150K

300K

450K

4%

5%

6%

Sep '14 Mar '15 Sep '15 Mar '16 Sep '16 Mar '17 Sep '17

Unemployment Rate (left) vs. Change in Nonfarm Payrolls (right)Change In Non-Farm Payrolls Unemployment Rate

0%

2%

4%

6%

Jun '14 Dec '14 Jun '15 Dec '15 Jun '16 Dec '16 Jun '17

Real GDP (QoQ)

-1%

0%

1%

2%

3%

Sep '14 Mar '15 Sep '15 Mar '16 Sep '16 Mar '17

Consumer Price IndexCPI (YoY) Core CPI (YoY)

2

2

1

1

1. Data as of First Quarter 2017.2. Data as of Second Quarter 2016.Note: YoY = year-over-year, QoQ = quarter over quarter, SAAR = seasonally adjusted annual rate, WTI = West Texas Intermediate crude oil.Source: Bloomberg.


5 of 52



Source: Bloomberg.

Interest Rate Overview

U.S. Treasury Note Yields U.S. Treasury Yield Curve

U.S. Treasury Yields Yield Curves as of 9/30/17

0%

1%

2%

3%

4%

3-mo

1-yr2-yr3-yr

5-yr

7-yr

10-yr

30-yr

Yiel

d

MaturitySeptember 30, 2017 December 30, 2016 September 30, 2016

Maturity Sep '17 Jun '17Change

over Quarter

Sep '16 Change over Year

3-month 1.05% 1.01% 0.04% 0.28% 0.77%

1-year 1.29% 1.23% 0.06% 0.59% 0.70%

2-year 1.49% 1.38% 0.11% 0.76% 0.73%

5-year 1.94% 1.89% 0.05% 1.15% 0.79%

10-year 2.33% 2.31% 0.02% 1.60% 0.73%

30-year 2.86% 2.84% 0.02% 2.32% 0.54%

0%

1%

2%

3%

4%

5%

3-mo

1-yr2-yr3-yr

5-yr

7-yr

10-yr

25-yr

30-yr

Yiel

d

MaturityU.S. Treasury Federal Agency Industrial Corporates, A Rated

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3/31/17 6/30/17 9/30/17

Yiel

d

2-Year 5-Year 10-Year


6 of 52



Source: BofA Merrill Lynch Indices.

September 30, 2017 Duration Yield 3 Months 1 Year 3 Years

1-3 Year IndicesU.S. Treasury 1.81 1.47% 0.24% 0.24% 0.76%

Federal Agency 1.69 1.55% 0.28% 0.50% 0.91%

U.S. Corporates, A-AAA rated 1.84 1.93% 0.56% 1.43% 1.61%

Agency MBS (0 to 3 years) 2.30 1.94% 0.36% 0.42% 1.32%

Taxable Municipals 1.79 2.12% 1.02% 1.67% 2.13%

1-5 Year IndicesU.S. Treasury 2.61 1.60% 0.29% (0.06%) 1.20%

Federal Agency 2.12 1.63% 0.32% 0.38% 1.21%




Master Indices (Maturities 1 Year or Greater)U.S. Treasury 6.29 1.95% 0.39% (1.74%) 2.19%

Federal Agency 3.87 1.89% 0.51% 0.02% 1.97%




As of 9/30/17 Returns for Periods ended 9/30/17

Returns for periods greater than one year are annualized.


BofA Merrill Lynch Index Returns

7 of 52



D I S C L O S U R E S PFM is the marketing name for a group of affiliated companies providing a range of services. All services are provided through separate agreements with each company. This material is for general information purposes only and is not intended to provide specific advice or a specific recommendation.Investment advisory services are provided by PFM Asset Management LLC which is registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940. The information contained is not an offer to purchase or sell any securities. Additional applicable regulatory information is available upon request.For more information regarding PFM’s services or entities, please visit www.pfm.com.The views expressed within this material constitute the perspective and judgment of PFM Asset Management LLC at the time of distribution and are subject to change. Information is obtained from sources generally believed to be reliable and available to the public; however, PFM Asset Management LLC cannot guarantee its accuracy, completeness, or suitability. This material is for general information purposes only and is not intended to provide specific advice or recommendation. The information contained in this report is not an offer to purchase or sell any securities.

© 2017 PFM Asset Management LLC. Further distribution is not permitted without prior written consent.


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Tab II


9 of 52

CITY OF ROWLETT, TEXAS


Executive Summary


The Portfolios are of high credit quality and invested in U.S. Treasury, federal agency, and commercial paper securities.

At quarter end, the Short Term Portfolio had a yield to maturity at cost 1.55% compared to a yield of 1.02% for TexPool.

The Long Term Fund Portfolio’s quarterly total return performance of 0.25% outperformed the benchmark performance of 0.24% by0.01%. For the last 12 months the Portfolio’s total return performance of 0.34% outperformed the benchmark performance of 0.24%.

After three rate hikes since December 2016, the Federal Reserve (Fed) shifted gears and announced the beginning of their programto reduce the central bank’s enormous balance sheet. The plan is to gradually reduce the Fed's securities holdings by decreasing itsreinvestment of the principal payments on its large holdings of Treasury and agency mortgage-backed securities. This had littleimpact on our strategy as the process was telegraphed well in advance and will be gradual and predictable.

Although low inflation is a conundrum, recent signaling from Fed officials boosted expectations for another rate hike this year, raisingthe market-implied probability of a December hike from 30% mid-Q3 to over 70%.

Strong investor appetite for high-quality bonds generally caused the yield spreads on investment-grade fixed income sectors (relativeto U.S. Treasuries) to tighten over the quarter, resulting in strong relative performance for corporates, mortgage-backed (MBS), asset-backed (ABS), municipal, and supranational securities.

Without a clear trend in the direction of interest rates, we maintained portfolio durations in line with those of benchmarks to minimizereturn volatility.

10 of 52

For the Quarter Ended September, 30, 2017City of Rowlett, Texas Portfolio Statistics

Amortized Cost1,2,3 Amortized Cost1,2,3 Market Value1,2,3 Market Value1,2,3 Duration (Years)Account Name September 30, 2017 June 30, 2017 September 30, 2017 June 30, 2017 September 30, 2017Pooled Funds $1,088,312 $1,097,011 $1,088,019 $1,097,210 0.680 Long Term Pooled Fund 13,236,813 13,255,909 13,180,750 13,202,254 1.780 TexPool 41,969,354.22 33,297,939 41,969,354 33,297,939 0.003 American National Bank of Texas 7,523,928.09 8,713,819 7,523,928 8,713,819 0.003 Total $63,818,408 $56,364,678 $63,762,051 $56,311,222 0.382

Yield to Maturity Yield to Maturity Yield to Maturity Yield to Maturityat Cost4 at Cost4 at Market at Market Duration (Years)

Account Name September 30, 2017 June 30, 2017 September 30, 2017 June 30, 2017 June 30, 2017 Pooled Funds 1.55% 1.35% 1.58% 1.24% 0.200Long Term Pooled Fund 1.24% 1.10% 1.50% 1.37% 1.580TexPool5 1.02% 0.96% 1.02% 0.96% 0.003American National Bank of Texas 0.00% 0.00% 0.00% 0.00% 0.003Weighted Average YTM 0.95% 0.85% 1.01% 0.91% 0.401

Monthly Interest earnings YTD6, 7

October 2016 $3,018 April 2017 $38,458November 2016 ($42,137) May 2017 $40,109December 2016 $20,912 June 2017 $20,307

January 2017 $32,514 July 2017 $55,855February 2017 $32,141 August 2017 $53,007

March 2017 $28,519 September 2017 $13,769

Total Fiscal Year Net Earnings $296,470

Notes:

1. On a trade-date basis, including accrued interest.2. In order to comply with GASB accrual accounting reporting requirements; forward settling trades are included in the monthly balances.

3. Excludes any money market fund/cash balances held in custodian account.4. Past performance is not indicative of future results.

5. TexPool yield is obtained from www.texpool.com.

6. Earnings are calculated on a cash basis and are subject to the receipt of coupon payments, maturities within the portfolio, and money market fund balances.


Summary Portfolio Statistics

11 of 52

For the Quarter Ended September, 30, 2017City of Rowlett, Texas Amortized Cost and Market Value Analysis

6/30/2017 6/30/2017 6/30/2017 9/30/2017 9/30/2017 9/30/2017 CHANGE IN

BANK/MONEY MARKET FUNDS MATURITY ACCRUED AMORTIZED MARKET ACCRUED AMORTIZED MARKET MARKETCUSIP DESCRIPTION PAR COUPON DATE INTEREST COST VALUE INTEREST COST VALUE VALUE

TEXPOOL TEXPOOL $0.00 $33,297,939.14 $33,297,939.14 $0.00 $41,969,354.22 $41,969,354.22 26.04%BANK ACCT AMERICAN NATIONAL BANK OF TEXAS 0.00 8,713,819.18 8,713,819.18 0.00 7,523,928.09 7,523,928.09 -13.66%

$0.00 $42,011,758.32 $42,011,758.32 $0.00 $49,493,282.31 $49,493,282.31 17.81%

TOTAL $0.00 $42,011,758.32 $42,011,758.32 $0.00 $49,493,282.31 $49,493,282.31 17.81%

POOLED FUNDSCOMMERCIAL PAPER06538BWC3 BANK OF TOKYO MITS UFJ LTD COMM PAPER 550,000.00 0.000 09/12/17 0.00 548,460.92 548,599.15 0.00 544,041.66 543,963.20 -0.85%09659BWC0 BNP PARIBARS COMM PAPER 550,000.00 0.000 09/12/17 0.00 548,550.14 548,610.70 0.00 544,270.83 544,055.60 -0.83%

$1,100,000 $0.00 $1,097,011.06 $1,097,209.85 $0.00 $1,088,312.49 $1,088,018.80 -0.84%

TOTAL $1,100,000 $0.00 $1,097,011.06 $1,097,209.85 $0.00 $1,088,312.49 $1,088,018.80 -0.838%

LONG TERM POOLED FUNDCOMMERCIAL PAPER22533UA86 Credit Agricole Commercial Paper 425,000.00 0.000 01/08/18 n/a n/a n/a 0.00 423,433.88 423,453.4346640QD65 JP Morgan Commercial Paper 425,000.00 0.000 04/06/18 n/a n/a n/a 0.00 421,644.39 421,702.43

$850,000 $0 $0 $0 $0 $845,078 $845,156 $0FED AGY BOND/NOTE3137EADZ9 FREDDIE MAC NOTES 500,000 1.125 04/15/19 1,187.50 501,460.00 497,753.50 2,593.75 501,257.60 497,460.50 -0.06%3135G0ZE6 FNMA NOTES 600,000 1.750 06/20/19 320.83 609,052.21 603,939.60 2,945.83 607,911.62 602,664.00 -0.21%3137EAEB1 FHLMC REFERENCE NOTE 600,000 0.875 07/19/19 2,362.50 598,184.49 592,849.80 1,050.00 598,404.04 593,053.80 0.03%3135G0N33 FNMA BENCHMARK NOTE 600,000 0.875 08/02/19 2,172.92 598,071.88 592,786.80 860.42 598,300.88 592,925.40 0.02%3135G0P49 FNMA NOTES 900,000 1.000 08/28/19 3,025.00 898,469.29 891,207.00 825.00 898,645.83 891,181.80 0.00%3130ACE26 FHLB NOTES 1,000,000 n/a n/a n/a 114.58 996,853.22 990,434.00

$4,200,000 $9,068.75 $3,205,237.87 $3,178,536.70 $8,389.58 $4,201,373.19 $4,167,719.50 31.12%US TSY BOND/NOTE912828A34 US TREASURY NOTES 1,450,000 1.250 11/30/2018 1,535.18 1,450,214.35 1,448,074.40 6,091.19 1,450,176.52 1,447,620.55 -0.03%912828G61 US TREASURY NOTES 880,000 1.500 11/30/2019 1,118.03 881,902.05 880,825.44 4,436.07 881,706.96 879,862.72 -0.11%912828J84 US TREASURY NOTES 800,000 1.375 3/31/2020 2,765.03 793,328.55 797,031.20 30.22 793,924.88 796,281.60 -0.09%912828N63 US TREASURY N/B 500,000 1.125 1/15/2019 2,594.96 499,255.94 498,203.00 1,192.26 499,376.32 498,164.00 -0.01%912828SH4 US TREASURY NOTES 1,950,000 1.375 2/28/2019 8,961.79 1,962,614.65 1,950,228.15 2,296.10 1,960,724.45 1,948,705.20 -0.08%912828WD8 US TREASURY NOTES 490,000 1.250 10/31/2018 1,031.93 492,864.70 489,425.72 2,563.18 492,329.27 489,253.73 -0.04%912828WL0 US TREASURY NOTES 435,000 1.500 5/31/2019 552.66 439,747.63 435,968.75 2,192.83 439,129.04 435,408.03 -0.13%912828XM7 US TREASURY NOTES 1,640,000 1.625 7/31/2020 N/A N/A N/A 4,489.95 1,641,313.12 1,640,897.08912828WP1 US TREASURY NOTES N/A 0.875 6/15/2017 0.00 0.00 0.00 N/A N/A N/A912828UU2 US TREASURY NOTES N/A 0.750 3/31/2018 4,713.11 2,495,794.53 2,490,722.50 N/A N/A N/A912828VK3 US TREASURY NOTES N/A 1.375 6/30/2018 37.36 1,002,569.88 1,000,859.00 N/A N/A N/A

$8,145,000.00 $23,310.05 $10,018,292.28 $9,991,338.16 $23,291.80 $8,158,680.56 $8,136,192.91 -18.57%

TOTAL $13,195,000.00 $32,378.80 $13,223,530.15 $13,169,874.86 $31,681.38 $13,205,132.02 $13,149,068.27 -0.158%

TOTAL PORTFOLIO $14,295,000 $32,378.80 $56,332,299.53 $56,278,843.03 $31,681.38 $63,786,726.82 $63,730,369.38 13.24%


Summary Portfolio Amortized Cost and Market Value Analysis

12 of 52

For the Quarter Ended September, 30, 2017City of Rowlett, Texas Composition and Credit Quality Characteristics

Security Type1 September 30, 2017 % of Portfolio June 30, 2017 % of Portfolio

U.S. Treasuries $8,159,485 12.8% $10,014,648 17.8%

Federal Agencies $4,176,109 6.5% 3,187,605 5.7%

Commercial Paper $1,933,175 3.0% 1,097,210 1.9%

Certificates of Deposit $0 0.0% 0 0.0%

Bankers Acceptances $0 0.0% 0 0.0%

Repurchase Agreements $0 0.0% 0 0.0%

Municipal Obligations $0 0.0% 0 0.0%

Corporate Notes/Bonds $0 0.0% 0 0.0%

American National Bank of Texas 7,523,928 11.80% 8,713,819 15.5%

TexPool 41,969,354 65.8% 33,297,939 59.1%

Totals $63,762,051 100.0% $56,311,222 100.0%

Notes:

1. End of quarter trade-date market values of portfolio holdings, including accrued interest.

2. Credit rating of securities held in portfolio, exclusive of money market fund, bank or LGIP. Standard & Poor's is the source of the credit ratings.


Summary Portfolio Composition and Credit Quality Characteristics

U.S. Treasuries

12.80%

Federal Agency

Obligations6.55%

Commercial Paper3.03%

American National Bank

of Texas11.80% TexPool

65.82%

Portfolio Compositionas of 09/30/17

AA+21.93%

A-1 (Short-term)3.44%

TexPool74.63%

Credit Quality Distribution² as of 09/30/17

13 of 52

For the Quarter Ended September, 30, 2017City of Rowlett, Texas Maturity Distribution

Maturity Distribution1 September 30, 2017 June 30, 2017

Overnight (Money Market Fund) $49,493,282 $42,011,758

Under 6 Months 423,453 1,097,210

6 - 12 Months 1,509,721 3,496,332

1 - 2 Years 8,019,048 5,939,778

2 - 3 Years 4,316,546 3,766,144

3 - 4 Years 0 0

4 - 5 Years 0 0

5 Years and Over 0 0

Totals $63,762,051 $56,311,222

Notes:

1. Callable securities in portfolio are included in the maturity distribution analysis to their stated maturity date, although they may be called prior to maturity.


Summary Portfolio Maturity Distribution

77.6%

0.7% 2.4%

12.6%6.8%

0.0% 0.0% 0.0%

74.6%

1.9%6.2%

10.5%6.7%

0.0% 0.0% 0.0%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Overnight Under 6 Months 6 - 12 Months 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years 5 Years and Over

Per

cent

age

of T

otal

Por

tfolio

Portfolio Maturity Distribution¹

September 30, 2017

June 30, 2017

14 of 52

For the Quarter Ended September, 30, 2017City of Rowlett, Texas General Ledger Entries

Earnings Calculation7/31/2017 Market Value Basis Source Document

July Market Value 46,169,692.46 1 Account Summary PageJuly Accrued Interest 33,867.24 2 Account Summary Page

Less (Purchases & Deposits) (5,170,190.02) 3 Security Transactions & InterestLess Purchased Interest (11,852.62) 4 Security Transactions & Interest

Add (Sales, Maturities, Paydowns, Withdrawals) 6,586,927.41 5 Security Transactions & InterestAdd Interest Receipts 45,788.58 6 Security Transactions & Interest

Less June Market Value (47,565,023.85) 7 Account Summary PageLess June Accrued Interest (32,378.80) 8 Account Summary Page

Earnings 56,830.40

Change in Investment Market Value (1,395,331.39) (1 - 7)

Change in Accrued Interest 1,488.44 (2 - 8)

Change in Cash 1,464,513.43 (sum 3 thru 6)

Investment EntriesTo Record Investment Activity Debit Credit Source Document

Cash 1,403,620.11 Security Transactions & InterestInvestments 1,395,331.39 Amortization/Accretion

Investment Income 8,288.72 EarningsTo record investment income/changes

Cash 60,893.32 Security Transactions & InterestAccrued Interest 1,488.44 Accrued Interest Difference

Investment Income 62,381.76 EarningsTo record interest income/changes

Notes:

1. Earnings are calculated using Market Value. This includes unrealized gains and losses, and income.


Summary Portfolio General Ledger Entries1

15 of 52



August Market Value 55,525,025.05 1 Account Summary PageAugust Accrued Interest 27,095.25 2 Account Summary Page

Less (Purchases & Deposits) (16,492,062.72) 3 Security Transactions & InterestLess Purchased Interest - 4 Security Transactions & Interest


Less July Market Value (46,196,718.54) 7 Account Summary PageLess July Accrued Interest (33,867.24) 8 Account Summary Page

Earnings 53,981.44

Change in Investment Market Value 9,328,306.41 (1 - 7)

Change in Accrued Interest (6,771.99) (2 - 8)

Change in Cash (9,261,125.57) (sum 3 thru 6)


Cash 9,316,199.61 Security Transactions & InterestInvestments 9,328,306.41 Amortization/Accretion




Notes:




16 of 52



September Market Value 56,171,653.84 1 Account Summary PageSeptember Accrued Interest 31,681.38 2 Account Summary Page

Less (Purchases & Deposits) (2,753,467.95) 3 Security Transactions & InterestLess Purchased Interest - 4 Security Transactions & Interest


Less August Market Value (55,553,003.74) 7 Account Summary PageLess August Accrued Interest (27,095.25) 8 Account Summary Page

Earnings 14,717.38

Change in Investment Market Value 618,650.10 (1 - 7)

Change in Accrued Interest 4,586.13 (2 - 8)

Change in Cash (602,738.12) (sum 3 thru 6)


Cash 669,206.95 Security Transactions & InterestInvestments 618,650.10 Amortization/Accretion




Notes:




17 of 52

CITY OF ROWLETT POOLED FUNDS


Portfolio Snapshot

Portfolio Statistics

As of September 30, 2017

$1,100,000

$1,088,019

$1,088,019

-

-

Accrued Interest:

Cash:

Par Value:

Total Market Value:

Security Market Value:

$1,088,312

1.58%

1.55%

AAverage Credit: *

Yield at Cost:

Amortized Cost:

Yield at Market:

Effective Duration: 0.68 Years

Duration to Worst: 0.68 Years

Average Maturity: 0.69 Years

Credit Quality (S&P Ratings)

100.0%

A-1

0%

20%

40%

60%

80%

100%

0 - 1 Year 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years > 5 Years

100.0%

0.0% 0.0% 0.0% 0.0% 0.0%

Maturity Distribution

Sector Allocation

100.0%

Commercial

Paper


* An average of each security’s credit rating assigned a numeric value and adjusted for its relative weighting in the portfolio.

Account 75981500

18 of 52



Portfolio Performance

Portfolio Earnings

Quarter-Ended September 30, 2017

Market Value Basis Accrual (Amortized Cost) Basis

Net Purchases/Sales

Change in Value

Interest Earned

$1,097,209.85

($12,529.00)

$3,337.95

$0.00

$3,337.95

$1,088,018.80

$1,097,011.06

($12,529.00)

$3,830.43

$0.00

$3,830.43

$1,088,312.49

Portfolio Earnings

Beginning Value (06/30/2017)

Ending Value (09/30/2017)

PFM Asset Management LLC Account 75981500

19 of 52



Portfolio Composition

Sector Allocation


Market Value ($) % of PortfolioSector

Commercial Paper 1,088,019 100.0%

Total $1,088,019 100.0%

100.0%

Commercial

Paper


Detail may not add to total due to rounding.

Account 75981500

20 of 52




Sector Allocation


Market Value ($)Sector % of Portfolio % of Benchmark

- 100.0% 1,088,019 Commercial Paper

$1,088,019 100.0% 0.0%Total

0%

20%

40%

60%

80%

100%

Commercial Paper

100.0%

0.0%




Account 75981500

21 of 52




Sector Allocation

September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016

% of TotalMV ($MM)Sector % of Total% of Total% of Total MV ($MM)MV ($MM)MV ($MM)

Commercial Paper 1.1 100.0% 1.1 100.0% 1.1 100.0% 1.1 100.0%

$1.1 100.0% $1.1 100.0% $1.1 100.0% $1.1 100.0%Total

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

September 2017 June 2017 March 2017 December 2016

Commercial Paper



Account 75981500

22 of 52






>5

Years

4-5

Years

3-4

Years

2-3

Years

1-2

Years

0-1

YearsYield

at MarketPortfolio/Benchmark

Average

Maturity

CITY OF ROWLETT POOLED FUNDS 1.58% 100.0% 0.0% 0.0% 0.0% 0.0% 0.0%0.69 yrs

0%

20%

40%

60%

80%

100%

0-1 Years 1-2 Years 2-3 Years 3-4 Years 4-5 Years > 5 Years

100.0%

0.0% 0.0% 0.0% 0.0% 0.0%



23 of 52





Duration Distribution

> 5 YEARS4-5 YEARS3-4 YEARS2-3 YEARS1-2 YEARS0-1 YEARSEffective

DurationPortfolio / Benchmark

CITY OF ROWLETT POOLED FUNDS 0.68 100.0% 0.0% 0.0% 0.0% 0.0% 0.0%

0%

20%

40%

60%

80%

100%


100%

0% 0% 0% 0% 0%

Distribution by Effective Duration

0%

20%

40%

60%

80%

100%


100%

0% 0% 0% 0% 0%

Contribution to Portfolio Duration


24 of 52




Credit Quality


S&P Rating Market Value ($) % of Portfolio

100.0%$1,088,019A-1

Totals 100.0%$1,088,019

100.0%

A-1



Account 75981500

25 of 52




Issuer Distribution


Market Value ($) % of PortfolioIssuer

BNP PARIBAS 544,056 50.0%

MITSUBISHI UFJ FINANCIAL GROUP INC 543,963 50.0%

1,088,019 100.0%Grand Total:


26 of 52




Sector/Issuer Distribution


% of SectorSector / Issuer Market Value ($) % of Total Portfolio

Commercial Paper

BNP PARIBAS 50.0% 50.0% 544,056

MITSUBISHI UFJ FINANCIAL GROUP INC 50.0% 50.0% 543,963

100.0% 100.0% 1,088,019 Sector Total

100.0% 1,088,019 Portfolio Total 100.0%


27 of 52



Portfolio Activity

Quarterly Portfolio Transactions

Trade

Date

Settle

Date

Maturity

DatePar ($) CUSIP Security Description

Transact

Amt ($)

Yield

at Market

Realized

G/L (BV)Coupon

BUY

9/12/17 9/13/17 550,000 06538CF89 BANK OF TOKYO MITSUBISHI UFJ LTD COMM PA 6/8/18 543,612.67 1.58%0.00%

9/12/17 9/13/17 550,000 09659CF86 BNP PARIBAS NY BRANCH COMM PAPER 6/8/18 543,858.33 1.52%0.00%

1,100,000 1,087,471.00Total BUY

MATURITY

9/12/17 9/12/17 550,000 09659BWC0 BNP PARIBAS NY BRANCH COMM PAPER 9/12/17 550,000.00 0.00 0.00%

9/12/17 9/12/17 550,000 06538BWC3 BANK OF TOKYO MITSU UFJ LTD COMM PAPER 9/12/17 550,000.00 0.00 0.00%

1,100,000 1,100,000.00 0.00Total MATURITY


28 of 52



Portfolio Activity


Security DescriptionCUSIPPar ($) Settle

Date

Trade

Date

Tran.

Type

Maturity

Date Transact

Amt ($)Yield

Realized

G/L (BV)Coupon

9/12/17 9/12/17 550,000.00 09659BWC0 BNP PARIBAS NY BRANCH COMM PAPERMATURITY 9/12/17 550,000.00 0.00 0.00%

9/12/17 9/12/17 550,000.00 06538BWC3 BANK OF TOKYO MITSU UFJ LTD COMM PAPERMATURITY 9/12/17 550,000.00 0.00 0.00%

9/12/17 9/13/17 550,000.00 06538CF89 BANK OF TOKYO MITSUBISHI UFJ LTD COMM PABUY 6/8/18 (543,612.67) 1.58%0.00%

9/12/17 9/13/17 550,000.00 09659CF86 BNP PARIBAS NY BRANCH COMM PAPERBUY 6/8/18 (543,858.33) 1.52%0.00%

TOTALS 12,529.00 0.00


29 of 52

CITY OF ROWLETT LONG TERM POOLED FUND


Portfolio Snapshot

Portfolio Statistics


$13,195,000

$13,180,750

$13,149,068

$31,681

-

Accrued Interest:

Cash:

Par Value:

Total Market Value:

Security Market Value:

$13,205,132

1.50%

1.24%

AAAverage Credit: *

Yield at Cost:

Amortized Cost:

Yield at Market:

Effective Duration: 1.78 Years

Duration to Worst: 1.78 Years

Average Maturity: 1.81 Years

Credit Quality (S&P Ratings)

6.4%

A-1

93.6%

AA+

0%

10%

20%

30%

40%

50%

60%

70%

0 - 1 Year 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years > 5 Years

6.4%

60.8%

32.8%

0.0% 0.0% 0.0%


Sector Allocation

6.4%

Commercial

Paper

31.7%

Federal

Agency/GSE

61.9%

U.S.

Treasury


* An average of each security’s credit rating assigned a numeric value and adjusted for its relative weighting in the portfolio.

Account 75981504

30 of 52




Portfolio Performance (Total Return)

Effective

DurationPortfolio/Benchmark

Annualized Return

10 Year1 Year 3 Year 5 YearSince Inception

(06/30/06) **

Current

Quarter

CITY OF ROWLETT LONG TERM POOLED FUND 1.78 0.25% 1.71%0.34% 0.76% 0.63% 2.16%

BofA ML 1-3 Year U.S. Treasury Index 1.81 0.24% 1.70%0.24% 0.76% 0.63% 2.20%

Difference 0.10% 0.01% 0.00% 0.00% 0.01% -0.04%

0.0%

0.4%

0.8%

1.2%

1.6%

2.0%

2.4%

Current Quarter 1 Year 3 Year 5 Year 10 Year Since Inception

0.25%0.34%

0.76%0.63%

1.71%

2.16%

0.24% 0.24%

0.76%0.63%

1.70%

2.20%

To

tal R

etu

rn

CITY OF ROWLETT LONG TERM POOLED FUND BofA ML 1-3 Year U.S. Treasury Index


Portfolio performance is gross of fees unless otherwise indicated. **Since Inception performance is not shown for periods less than one year.

Account 75981504

31 of 52





Effective

DurationPortfolio/Benchmark

Annualized Return

06/30/17 12/31/1609/30/17 03/31/17

Quarter Ended

5 Year1 Year 3 Year

CITY OF ROWLETT LONG TERM POOLED FUND 1.78 0.25% 0.34% 0.76% 0.63%0.20% 0.26% -0.36%

BofA ML 1-3 Year U.S. Treasury Index 1.81 0.24% 0.24% 0.76% 0.63%0.17% 0.26% -0.43%

Difference 0.10% 0.01% 0.00% 0.00%0.03% 0.00% 0.07%

-0.6%

-0.4%

-0.2%

0.0%

0.2%

0.4%

0.6%

0.8%

09/30/17 06/30/17 03/31/17 12/31/16 1 Year 3 Year 5 Year

0.25%0.20%

0.26%

-0.36%

0.34%

0.76%

0.63%

0.24%0.17%

0.26%

-0.43%

0.24%

0.76%

0.63%

To

tal R

etu

rn



Portfolio performance is gross of fees unless otherwise indicated.

Account 75981504

32 of 52





06/30/17 12/31/1609/30/17 03/31/17

Quarter Ended Annualized Return

5 Year1 Year 3 YearPortfolio/Benchmark

Effective

Duration

0.34% 0.76% 0.63%0.20% 0.26% -0.36%CITY OF ROWLETT LONG TERM POOLED FUND 0.25%1.78

0.26% 0.68% 0.55%0.18% 0.24% -0.38% Net of Fees ** 0.23%-

0.24% 0.76% 0.63%0.17% 0.26% -0.43%BofA ML 1-3 Year U.S. Treasury Index 0.24%1.81

0.10% 0.01% 0.00% 0.00%0.03% 0.00% 0.07%Difference (Gross)

Difference (Net) -0.01% 0.01% -0.02% 0.05% 0.02% -0.08% -0.08%

-0.6%

-0.4%

-0.2%

0.0%

0.2%

0.4%

0.6%

0.8%

09/30/17 06/30/17 03/31/17 12/31/16 1 Year 3 Year 5 Year

0.25%0.20%

0.26%

-0.36%

0.34%

0.76%

0.63%

0.24%0.17%

0.26%

-0.43%

0.24%

0.76%

0.63%

To

tal

Re

turn



Portfolio performance is gross of fees unless otherwise indicated. ** Fees were calculated based on average assets during the period at the contractual rate.

Account 75981504

33 of 52




Portfolio Earnings

Quarter-Ended September 30, 2017

Market Value Basis Accrual (Amortized Cost) Basis

Net Purchases/Sales

Change in Value

Interest Earned

$13,169,874.86

($12,243.31)

($8,563.28)

$40,989.33

$32,426.05

$13,149,068.27

$13,223,530.15

($12,243.31)

($6,154.82)

$40,989.33

$34,834.51

$13,205,132.02

Portfolio Earnings

Beginning Value (06/30/2017)

Ending Value (09/30/2017)


34 of 52




Sector Allocation


Market Value ($) % of PortfolioSector

U.S. Treasury 8,136,193 61.9%

Federal Agency/GSE 4,167,720 31.7%

Commercial Paper 845,156 6.4%

Total $13,149,068 100.0%

6.4%

Commercial

Paper

31.7%

Federal

Agency/GSE

61.9%

U.S. Treasury



Account 75981504

35 of 52




Sector Allocation


Market Value ($)Sector % of Portfolio % of Benchmark

100.0% 61.9% 8,136,193 U.S. Treasury

- 31.7% 4,167,720 Federal Agency/GSE

- 6.4% 845,156 Commercial Paper

$13,149,068 100.0% 100.0%Total

0%

20%

40%

60%

80%

100%

120%

Commercial Paper Federal Agency/GSE U.S. Treasury

6.4%

31.7%

61.9%

0.0% 0.0%

100.0%




Account 75981504

36 of 52




Sector Allocation

September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016

% of TotalMV ($MM)Sector % of Total% of Total% of Total MV ($MM)MV ($MM)MV ($MM)

U.S. Treasury 8.1 61.9% 10.0 75.9% 10.2 76.3% 10.2 76.3%

Federal Agency/GSE 4.2 31.7% 3.2 24.1% 3.2 23.7% 3.2 23.7%

Commercial Paper 0.8 6.4% 0.0 0.0% 0.0 0.0% 0.0 0.0%

$13.1 100.0% $13.2 100.0% $13.4 100.0% $13.4 100.0%Total

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

September 2017 June 2017 March 2017 December 2016

Commercial Paper

Federal Agency/GSE

U.S. Treasury



Account 75981504

37 of 52






>5

Years

4-5

Years

3-4

Years

2-3

Years

1-2

Years

0-1

YearsYield

at MarketPortfolio/Benchmark

Average

Maturity

CITY OF ROWLETT LONG TERM POOLED FUND 1.50% 6.4% 60.8% 32.8% 0.0% 0.0% 0.0%1.81 yrs

BofA ML 1-3 Year U.S. Treasury Index 1.48% 2.9% 53.9% 43.1% 0.0% 0.0% 0.0%1.93 yrs

0%

10%

20%

30%

40%

50%

60%

70%


6.4%

60.8%

32.8%

0.0% 0.0% 0.0%2.9%

53.9%

43.1%

0.0% 0.0% 0.0%



38 of 52





Duration Distribution

> 5 YEARS4-5 YEARS3-4 YEARS2-3 YEARS1-2 YEARS0-1 YEARSEffective

DurationPortfolio / Benchmark

CITY OF ROWLETT LONG TERM POOLED FUND 1.78 6.4% 60.8% 32.8% 0.0% 0.0% 0.0%

BofA ML 1-3 Year U.S. Treasury Index 1.81 2.9% 54.7% 42.4% 0.0% 0.0% 0.0%

0%

10%

20%

30%

40%

50%

60%

70%


6%

61%

33%

0% 0% 0%3%

55%

42%

0% 0% 0%

Distribution by Effective Duration


BofA ML 1-3 Year U.S. Treasury Index

0%

10%

20%

30%

40%

50%

60%


1%

51%48%

0% 0% 0%2%

44%

55%

0% 0% 0%

Contribution to Portfolio Duration

BofA ML 1-3 Year U.S. Treasury Index



39 of 52




Credit Quality


S&P Rating Market Value ($) % of Portfolio

93.6%$12,303,912AA+

6.4%$845,156A-1

Totals 100.0%$13,149,068

6.4%

A-1

93.6%

AA+



Account 75981504

40 of 52




Issuer Distribution


Market Value ($) % of PortfolioIssuer

UNITED STATES TREASURY 8,136,193 61.9%

FANNIE MAE 2,086,771 15.9%

FREDDIE MAC 1,090,514 8.3%

FEDERAL HOME LOAN BANKS 990,434 7.5%

CREDIT AGRICOLE SA 423,453 3.2%

JP MORGAN CHASE & CO 421,702 3.2%

13,149,068 100.0%Grand Total:


41 of 52




Sector/Issuer Distribution


% of SectorSector / Issuer Market Value ($) % of Total Portfolio

Commercial Paper

CREDIT AGRICOLE SA 3.2% 50.1% 423,453

JP MORGAN CHASE & CO 3.2% 49.9% 421,702

100.0% 6.4% 845,156 Sector Total

Federal Agency/GSE

FANNIE MAE 15.9% 50.1% 2,086,771

FEDERAL HOME LOAN BANKS 7.5% 23.8% 990,434

FREDDIE MAC 8.3% 26.2% 1,090,514

100.0% 31.7% 4,167,720 Sector Total

U.S. Treasury

UNITED STATES TREASURY 61.9% 100.0% 8,136,193

100.0% 61.9% 8,136,193 Sector Total

100.0% 13,149,068 Portfolio Total 100.0%


42 of 52



Portfolio Activity


Trade

Date

Settle

Date

Maturity


Transact

Amt ($)

Yield

at Market

Realized

G/L (BV)Coupon

BUY

7/10/17 7/10/17 425,000 46640QD65 JP MORGAN SECURITIES LLC COMM PAPER 4/6/18 420,155.00 1.54%0.00%

7/10/17 7/11/17 425,000 22533UA86 CREDIT AGRICOLE CIB NY COMM PAPER 1/8/18 422,136.68 1.35%0.00%

7/10/17 7/11/17 1,640,000 912828XM7 US TREASURY NOTES 7/31/20 1,653,262.00 1.60%1.62%

9/7/17 9/8/17 1,000,000 3130ACE26 FHLB NOTES 9/28/20 996,790.00 1.48%1.37%

3,490,000 3,492,343.68Total BUY

INTEREST

7/15/17 7/15/17 500,000 912828N63 US TREASURY N/B 1/15/19 2,812.50 1.12%

7/19/17 7/19/17 600,000 3137EAEB1 FHLMC REFERENCE NOTE 7/19/19 2,625.00 0.87%

7/31/17 7/31/17 1,640,000 912828XM7 US TREASURY NOTES 7/31/20 13,325.00 1.62%

8/2/17 8/2/17 600,000 3135G0N33 FNMA BENCHMARK NOTE 8/2/19 2,625.00 0.87%

8/28/17 8/28/17 900,000 3135G0P49 FNMA NOTES 8/28/19 4,500.00 1.00%

8/31/17 8/31/17 1,950,000 912828SH4 US TREASURY NOTES 2/28/19 13,406.25 1.37%

9/28/17 9/28/17 1,000,000 3130ACE26 FHLB NOTES 9/28/20 763.89 1.37%

9/30/17 9/30/17 800,000 912828J84 US TREASURY NOTES 3/31/20 5,500.00 1.37%

7,990,000 45,557.64Total INTEREST

SELL

7/10/17 7/11/17 2,079,000 912828UU2 US TREASURY NOTES 3/31/18 2,076,361.31 1.22% (3,614.08)0.75%

7/10/17 7/10/17 421,000 912828UU2 US TREASURY NOTES 3/31/18 420,457.03 1.22% (729.29)0.75%

9/11/17 9/12/17 1,000,000 912828VK3 US TREASURY NOTES 6/30/18 1,003,897.76 1.23% (927.32)1.37%


43 of 52



Portfolio Activity

Trade

Date

Settle

Date

Maturity


Transact

Amt ($)

Yield

at Market

Realized

G/L (BV)Coupon

3,500,000 3,500,716.10 -5,270.69Total SELL


44 of 52



Portfolio Activity


Security DescriptionCUSIPPar ($) Settle

Date

Trade

Date

Tran.

Type

Maturity

Date Transact

Amt ($)Yield

Realized

G/L (BV)Coupon

7/10/17 7/10/17 425,000.00 46640QD65 JP MORGAN SECURITIES LLC COMM PAPERBUY 4/6/18 (420,155.00) 1.54%0.00%

7/10/17 7/10/17 421,000.00 912828UU2 US TREASURY NOTESSELL 3/31/18 420,457.03 1.22% (729.29)0.75%

7/10/17 7/11/17 425,000.00 22533UA86 CREDIT AGRICOLE CIB NY COMM PAPERBUY 1/8/18 (422,136.68) 1.35%0.00%

7/10/17 7/11/17 1,640,000.00 912828XM7 US TREASURY NOTESBUY 7/31/20 (1,653,262.00) 1.60%1.62%

7/10/17 7/11/17 2,079,000.00 912828UU2 US TREASURY NOTESSELL 3/31/18 2,076,361.31 1.22% (3,614.08)0.75%

7/15/17 7/15/17 500,000.00 912828N63 US TREASURY N/BINTEREST 1/15/19 2,812.50 1.12%

7/19/17 7/19/17 600,000.00 3137EAEB1 FHLMC REFERENCE NOTEINTEREST 7/19/19 2,625.00 0.87%

7/31/17 7/31/17 1,640,000.00 912828XM7 US TREASURY NOTESINTEREST 7/31/20 13,325.00 1.62%

8/2/17 8/2/17 600,000.00 3135G0N33 FNMA BENCHMARK NOTEINTEREST 8/2/19 2,625.00 0.87%

8/28/17 8/28/17 900,000.00 3135G0P49 FNMA NOTESINTEREST 8/28/19 4,500.00 1.00%

8/31/17 8/31/17 1,950,000.00 912828SH4 US TREASURY NOTESINTEREST 2/28/19 13,406.25 1.37%

9/7/17 9/8/17 1,000,000.00 3130ACE26 FHLB NOTESBUY 9/28/20 (996,790.00) 1.48%1.37%

9/11/17 9/12/17 1,000,000.00 912828VK3 US TREASURY NOTESSELL 6/30/18 1,003,897.76 1.23% (927.32)1.37%

9/28/17 9/28/17 1,000,000.00 3130ACE26 FHLB NOTESINTEREST 9/28/20 763.89 1.37%

9/30/17 9/30/17 800,000.00 912828J84 US TREASURY NOTESINTEREST 3/31/20 5,500.00 1.37%

TOTALS 53,930.06 (5,270.69)


45 of 52

Tab III


46 of 52


CITY OF ROWLETT, TEXAS Asset Allocation

Security Type1Amortized Cost

(Includes Interest)Allocation

Percentage NotesPermitted by Policy

In Compliance

American National Bank of Texas 7,523,928.09 11.79% 100% YESTexPool - Local Government Investment Pool 41,969,354.22 65.76% 100% YESUnited States Treasury Securities 8,181,972.36 12.82% 100% YESUnited States Government Agency Securities - 0.00% 100% YESFederal Instrumentalities 4,209,762.77 6.60% 2 100% YESMortgage-Backed Securities - 0.00% 2 20% YESCertificates of Deposit - 0.00% 20% YESRepurchase Agreements - 0.00% 20% YESCommercial Paper 1,933,390.76 3.03% 25% YESCorporate Notes - 0.00% 0% YESBankers' Acceptances - 0.00% 25% YESState and/or Local Government Debt - 0.00% 25% YESFixed Income Money Market Mutual Funds - 0.00% 50% YESNotes:1. End of month trade-date amortized cost of portfolio holdings, including accrued interest. 2. The combined total of Federal Instrumentalities and Mortgage Backed Securities can not be more than 100%. The combined total as of September 30, 2017 is 6.60%.


American National Bank of

Texas11.79%

TexPool - Local Government

Investment Pool65.76%

United States Treasury Securities

12.82%

Federal Instrumentalities

6.60%

Commercial Paper 3.03%

47 of 52


CITY OF ROWLETT, TEXAS Asset Allocation

Individual Issuer BreakdownAmortized Cost

(Includes Interest)Allocation

Percentage NotesPermitted by Policy

In Compliance

Government National Mortgage Association (GNMA) - 0.00% 40% YESFederal Farm Credit Bank (FFCB) - 0.00% 40% YESFederal Home Loan Bank (FHLB) 996,967.80 1.56% 40% YESFederal National Mortgage Association (FNMA) 2,109,489.58 3.31% 40% YESFederal Home Loan Mortgage Corporation (FHLMC) 1,103,305.39 1.73% 40% YESBank of Tokyo Mitsubishi, Inc. Commercial Paper 544,041.66 0.85% 5% YESBNP Paribas Commercial Paper 544,270.83 0.85% 5% YESCredit Agricole Commercial Paper 423,433.88 0.66% 5% YESJP Morgan Commercial Paper 421,644.39 0.66% 5% YES


48 of 52



Portfolio Activity

IMPORTANT DISCLOSURES

This material is based on information obtained from sources generally believed to be reliable and available to the public; however, PFM Asset Management LLC cannot guarantee its

accuracy, completeness or suitability. This material is for general information purposes only and is not intended to provide specific advice or a specific recommendation. All statements as

to what will or may happen under certain circumstances are based on assumptions, some, but not all of which, are noted in the presentation. Assumptions may or may not be proven

correct as actual events occur, and results may depend on events outside of your or our control. Changes in assumptions may have a material effect on results. Past performance does

not necessarily reflect and is not a guaranty of future results.The information contained in this presentation is not an offer to purchase or sell any securities.

Dime

Ã Market values that include accrued interest are derived from closing bid prices as of the last business day of the month as supplied by Interactive Data, Bloomberg, or Telerate.

Where prices are not available from generally recognized sources, the securities are priced using a yield based matrix system to arrive at an estimated market value.

Ã In accordance with generally accepted accounting principles, information is presented on a trade date basis; forward settling purchases are included in the monthly balances, and

forward settling sales are excluded.

Ã Performance is presented in accordance with the CFA Institute ’s Global Investment Performance Standards (GIPS). Unless otherwise noted, performance is shown gross of fees.

Quarterly returns are presented on an unannualized basis. Returns for periods greater than one year are presented on an annualized basis. Past performance is not indicative of

future returns.

Ã Bank of America/Merrill Lynch Indices provided by Bloomberg Financial Markets.

Ã Money market fund/cash balances are included in performance and duration computations.

Ã Standard & Poorʼs is the source of the credit ratings. Distribution of credit rating is exclusive of money market fund/LGIP holdings.

Ã Callable securities in the portfolio are included in the maturity distribution analysis to their stated maturity date, although, they may be called prior to maturity.

Ã MBS maturities are represented by expected average life.


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Appendix

GLOSSARY

Ã ACCRUED INTEREST: Interest that is due on a bond or other fixed income security since the last interest payment was made.

Ã AGENCIES: Federal agency securities and/or Government-sponsored enterprises.

Ã AMORTIZED COST: The original cost of the principal of the security is adjusted for the amount of the periodic reduction of any discount or premium from the purchase date until

the date of the report. Discount or premium with respect to short-term securities (those with less than one year to maturity at time of issuance) is amortized on a straight line basis.

Such discount or premium with respect to longer-term securities is amortized using the constant yield basis.

Ã BANKERS’ ACCEPTANCE: A draft or bill or exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill as well as the insurer.

Ã COMMERCIAL PAPER: An unsecured obligation issued by a corporation or bank to finance its short-term credit needs, such as accounts receivable and inventory.

Ã CONTRIBUTION TO DURATION: Represents each sector or maturity range ’s relative contribution to the overall duration of the portfolio measured as a percentage weighting. Since

duration is a key measure of interest rate sensitivity, the contribution to duration measures the relative amount or contribution of that sector or maturity range to the total rate

sensitivity of the portfolio.

Ã DURATION TO WORST: A measure of the sensitivity of a security ’s price to a change in interest rates, stated in years, computed from cash flows to the maturity date or to the put

date, whichever results in the highest yield to the investor.

Ã EFFECTIVE DURATION: A measure of the sensitivity of a security’s price to a change in interest rates, stated in years.

Ã EFFECTIVE YIELD: The total yield an investor receives in relation to the nominal yield or coupon of a bond. Effective yield takes into account the power of compounding on

investment returns, while ominal yield does not.

Ã FDIC: Federal Deposit Insurance Corporation. A federal agency that insures bank deposits to a specified amount.

Ã INTEREST RATE: Interest per year divided by principal amount and expressed as a percentage.

Ã MARKET VALUE: The value that would be received or paid for an investment in an orderly transaction between market participants at the measurement date.

Ã MATURITY: The date upon which the principal or stated value of an investment becomes due and payable.

Ã NEGOTIABLE CERTIFICATES OF DEPOSIT: A CD with a very large denomination, usually $1 million or more, that can be traded in secondary markets.

Ã PAR VALUE: The nominal dollar face amount of a security.


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Appendix

GLOSSARY

Ã PASS THROUGH SECURITY: A security representing pooled debt obligations that passes income from debtors to its shareholders. The most common type is the

mortgage-backed security.

Ã REPURCHASE AGREEMENTS: A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date.

Ã SETTLE DATE: The date on which the transaction is settled and monies/securities are exchanged. If the settle date of the transaction (i.e., coupon payments and maturity

proceeds) occurs on a non-business day, the funds are exchanged on the next business day.

Ã TRADE DATE: The date on which the transaction occurred; however, the final consummation of the security transaction and payment has not yet taken place.

Ã UNSETTLED TRADE: A trade which has been executed; however, the final consummation of the security transaction and payment has not yet taken place.

Ã U.S. TREASURY: The department of the U.S. government that issues Treasury securities.

Ã YIELD: The rate of return based on the current market value, the annual interest receipts, maturity value, and the time period remaining until maturity, stated as a percentage on

an annualized basis.

Ã YTM AT COST: The yield to maturity at cost is the expected rate of return based on the original cost, the annual interest receipts, maturity value, and the time period from

purchase date to maturity, stated as a percentage on an annualized basis.

Ã YTM AT MARKET: The yield to maturity at market is the rate of return based on the current market value, the annual interest receipts, maturity value, and the time period

remaining until maturity, stated as a percentage on an annualized basis.


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investment performance review for the quarter ended

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