Presentation by Mellon Bank on the Custody and Securities Lending Services
Provided to the Permanent School Fund
September 14, 2011
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND: DISCUSSION
STATE BOARD OF EDUCATION: NO ACTION
SUMMARY: This item provides an opportunity for Mellon Bank to review the custody and securities lending services provided to the Permanent School Fund.
BOARD RESPONSE: Based on the information presented, the committee may direct staff as appropriate.
PREVIOUS BOARD ACTION: None.
FUTURE ACTION EXPECTED: None.
BACKGROUND INFORMATION AND SIGNIFICANT ISSUES: At its February 27, 2004 meeting, the board selected Mellon Bank to provide custody and securities lending services. The master trust custodian maintains custody of all securities owned by the Permanent School Fund. The custodian facilitates the operational movement of securities, collects and distributes funds for transactions, collects and remits income, and provides accounting, reporting, and analytical capability for management of the Fund. As securities lending agent for the Fund, the custodian operates a securities lending program in order to earn income for the Permanent School Fund.
FISCAL IMPACT: The distribution of the Permanent School Fund is projected to be $1.9 billion during the 2012-2013 biennium.
PROCEDURAL AND REPORTING IMPLICATIONS: Not applicable.
PUBLIC COMMENTS: None.
OTHER COMMENTS AND RELATED ISSUES: None.
Commissioner of Education
Staff Member Responsible:
Holland Timmins, Executive Administrator
and Chief Investment Officer of the
Texas Permanent School Fund
Information to be provided to committee members at the meeting.