News

City’s wealth continues to grow

The City of Burnaby earned $38.3 million on its investment portfolio in 2013. That’s up $600,000 over the previous year despite a lower rate of return, 4.64 per cent last year compared to five per cent in 2012.

But it’s a lot better than the Bank of Canada bank rate, which closed at 1.25 per cent at the end of 2013.

In a report to the finance and civic development committee, Denise Jorgenson, Burnaby’s director of finance, said the city’s cash and investments at the end of last year totalled $679,538,076. That money includes restricted funds such as development cost charges and all other reserve funds.

Of that about $558 million is invested in long-term investments like bonds with annual yields of 3-7.35 per cent, while the balance is in shorter term investments like money market funds.

This strategy helps minimize the impact of fluctuations in short-term interest rates, said Jorgenson.

The city also likes to spread its money around as it maintained investment relationships with three banks and more than half a dozen credit unions in British Columbia and Alberta along with the Credit Union Deposit Insurance Corporation in BC and the Credit Union Deposit Guarantee Corporation in Alberta, both provincially legislated insurance companies funded by credit unions.

This diversification as well as what limits the city sets on the amount it can invest with each type of institution is “essential for managing risk and return,” said Jorgenson.

But with the Bank of Canada predicting soft economic growth for 2014 and a continuation of low interest rates, Jorgenson predicts the city’s investments will earn $36.5 in the coming year. Of that, $7 million will go to the city’s operating budget while the rest will be deposited into the reserve funds.

 

We encourage an open exchange of ideas on this story's topic, but we ask you to follow our guidelines for respecting community standards. Personal attacks, inappropriate language, and off-topic comments may be removed, and comment privileges revoked, per our Terms of Use. Please see our FAQ if you have questions or concerns about using Facebook to comment.

You might like ...

Booze coming to B.C. grocery stores in 2015
 
Health minister reverses decision to cancel seniors flu clinics
 
Police say attack near library was targeted
Two survive fiery Surrey crash
 
Election 2014: Sole independent school trustee confident about new board
 
Jim Cuddy riding rails with CP Holiday Train
No raises for council until at least 2013
 
‘Jail time not warranted’ in White Rock sex assault: lawyer
 
Chilliwack hillsides plan takes servicing into account

Community Events, November 2014

Add an Event


Read the latest eEdition

Browse the print edition page by page, including stories and ads.

Nov 14 edition online now. Browse the archives.