The Portfolio Holder for Finance and Resources introduced a report providing an overview of investment activity during 2012/13 as required by the Council’s Financial Procedure Rules.  The report outlined the strategy adopted during the year, showed the position of the investment portfolio at the beginning and end of the year and gave details of how the fund performed in comparison with the previous years and various benchmarks.

The Portfolio Holder for Finance and Resources reported that 2012/13 had been a challenging year in terms of both the economic conditions and the investment environment. Ever since the financial crisis of 2008, the Council had adopted a very cautious investment approach. The consequences had been to restrict the number of counterparties to whom the Council had been prepared to lend and the acceptance of lower rates of return than otherwise could have been achieved.

The Portfolio Holder was pleased to report that the interest budget had been exceeded by approximately £117,000 and that the return on the fund exceeded the recognised benchmarks.

The Chief Finance Officer reported that recovery of the Icelandic investment was on-going and, so far, three dividend payments had been received totalling approximately 50% of the outstanding amount.

The Leader of the Council reported that he had been approached by the manager of the new Sevenoaks branch of Handelsbanken which was offering attractive interest rates.

The Cabinet thanked Officers for exceeding the anticipated return on the Council’s investments.

Public Sector Equality Duty

Members noted that consideration had been given to impacts under the Public Sector Equality Duty.

Resolved: That the Annual Treasury Management Report for 2012/13 be approved.