State Treasurer Milligan reports $13.2M revenue surge amid stagnant interest rates
November 17, 2021 | Arkansas State Treasurer's Office, Arkansas
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The Arkansas Treasurer of State convened a meeting on November 17, 2021, to discuss the financial performance and strategic direction of the state's investment portfolio for the first quarter of fiscal year 2022, which spanned from July 1 to September 30. The meeting began with Treasurer Milligan presenting a report highlighting the portfolio's performance amidst stagnant interest rates and a slight increase in the 10-year treasury yield curve rates.
Treasurer Milligan reported a total revenue of $13,180,000 for Q1, nearly double the earnings from the same period last year. The long-term portfolio generated $12,500,000, a significant increase from $5,750,000 in the previous year. Milligan emphasized the team's efforts in diversifying investments and making calculated decisions to ensure stability, resulting in small but steady gains throughout the fiscal year.
The short-term portfolio, which includes demand and money market accounts, earned approximately $615,000, down from $1,000,000 in the same quarter last year, primarily due to low interest rates. Milligan noted that this trend is expected to continue for the remainder of the fiscal year.
The meeting also included a discussion on the potential impact of the Federal Reserve's bond tapering on the fixed income market, with Milligan expressing optimism about future opportunities for increasing holdings and earnings. The team is closely monitoring inflation trends, which have risen over 5% in the past year, and their potential long-term effects on investment strategies.
Following the treasurer's report, the board unanimously accepted the findings. The agenda then moved to quarterly reports for Q3 of fiscal year 2022, where the chairman motioned that no funds were available for deposit into the state board of finance certificate deposit program, which was also approved.
The meeting concluded with a discussion led by Grant Wallace, Chief Deputy of the Treasurer, regarding the complexities of establishing a total return and benchmark for the treasurer's portfolio. Wallace noted that the office is exploring best practices from other states to enhance performance measurement.
Overall, the meeting underscored the treasurer's commitment to prudent investment strategies and proactive management of the state's financial resources in a challenging economic environment.
Treasurer Milligan reported a total revenue of $13,180,000 for Q1, nearly double the earnings from the same period last year. The long-term portfolio generated $12,500,000, a significant increase from $5,750,000 in the previous year. Milligan emphasized the team's efforts in diversifying investments and making calculated decisions to ensure stability, resulting in small but steady gains throughout the fiscal year.
The short-term portfolio, which includes demand and money market accounts, earned approximately $615,000, down from $1,000,000 in the same quarter last year, primarily due to low interest rates. Milligan noted that this trend is expected to continue for the remainder of the fiscal year.
The meeting also included a discussion on the potential impact of the Federal Reserve's bond tapering on the fixed income market, with Milligan expressing optimism about future opportunities for increasing holdings and earnings. The team is closely monitoring inflation trends, which have risen over 5% in the past year, and their potential long-term effects on investment strategies.
Following the treasurer's report, the board unanimously accepted the findings. The agenda then moved to quarterly reports for Q3 of fiscal year 2022, where the chairman motioned that no funds were available for deposit into the state board of finance certificate deposit program, which was also approved.
The meeting concluded with a discussion led by Grant Wallace, Chief Deputy of the Treasurer, regarding the complexities of establishing a total return and benchmark for the treasurer's portfolio. Wallace noted that the office is exploring best practices from other states to enhance performance measurement.
Overall, the meeting underscored the treasurer's commitment to prudent investment strategies and proactive management of the state's financial resources in a challenging economic environment.
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