Citizens Finance and Investment Committee Meeting: June 18

On Wednesday, June 18, 2008, Citizens Property Insurance Corporation (“Citizens”) held a Finance and Investment Committee (“Committee”) meeting to receive an update on liquidity financing, give consent regarding the broker-dealer team, and hear the Investment Report.  To view the complete agenda, click here.

The meeting was called to order by Chairman Bruce Douglas.  A quorum of members were not in attendance, however, it was determined that the meeting could commence because the recommendations made by the Committee to the Board of Governors (“Board”) would be advisory in nature only.

Sharon Binnun, Citizens’ Chief Financial Officer (“CFO”), and John Forney from Citizens’ financial investment company, Raymond James, gave the Liquidity Financing Update.  Mr. Forney advised that in addition to the Liquidity Program having been completed, $1.75 billion in pre-event financing has been procured for Citizens’ High-Risk Account (“HRA”), and the $1.75 billion previously held in the fixed-rate capital market has been restructured. 

Citizens currently holds $10 billion of liquidity in its two accounts, bringing its pre-assessment claims paying capacity to over $20 billion.

Ms. Binnun submitted a revised broker-dealer team for the HRA 2008A Liquidity Program (“Program”) for approval.  The Program consists of a fixed-rate short-term bond issuance of $2 billion, to be completed in one or more series.

The Board previously approved the Program and the Senior Managing Underwriter and Co-Manager Teams, and gave authorization for the Chairman to finalize the details, terms and conditions of the bonds.  The Chairman determined two bond issuances should be made:  Series 2008A-1 short-term tax-exempt bonds to mature within three to five years, and Series 2008A-2 liquidity notes to mature in under 13 months. 

Changes since the Board approved the teams include promoting Merrill Lynch from the co-managing to senior managing team to replace UBS, since UBS is no longer in the municipal finance market, and replacing Merrill Lynchs’ resulting vacancy on the co-managing team with Morgan Keegan. 

The Committee voted to recommend Board approval for the amended broker-dealer teams.  To view a copy of the consent agenda, click here. 

Ms. Binnun presented the Investment Report.  As of April 30, 2008, Citizens has approximately $6.2 billion in bond proceeds, operating cash and reserve funds, and approximately $5.6 billion in investments.  To view the Fund Summary Table, click here.  To view the Investment Chart, click here.

The meeting was then adjourned.

Should you have any questions or comments, please do not hesitate to contact Colodny Fass.