Centralized Treasury and Securities Management Division

Collateral Management

The Collateral Management Section is comprised of two units: Pledged Collateral and Safekeeping and Vault Services. The following are the detailed functions of each unit:

Pledged Collateral Unit

The Pledged Collateral Unit administers the clearance and settlement of securities pledged as collateral by California financial institutions to the State for the Time, Demand, and State Agency programs. The unit is responsible for completing a monthly market valuation and calculating the collateral requirement and ensuring sufficient collateral levels are maintained for each participating financial institution. Its responsibility is to assure that all collected funds on deposit are collateralized in accordance with Sections 16520 through 16533 of the Government Code. It clears and settles approximately 10,313 security transaction items annually and has an average monthly balance of approximately $9.5 billion. It maintains accurate financial records and ensures security accountability. There are approximately 1,000 book entry securities at 6 outside depositories totaling $6 billion and 374 physical securities in the Vault totaling $3.9 billion.

Safekeeping and Vault Services Unit

The Safekeeping and Vault Services Unit administers the safekeeping of items in the State Treasurer's Office (STO) Vault, completing approximately 76 transactions annually for 231 items with an average monthly inventory of 3,723 items. This unit safe keeps items that belong to and are received from various state agencies and STO Divisions such as sealed boxes, sealed envelopes and common stock shares. It also maintains accurate financial records and ensures security accountability for all items and securities such as Promissory Notes and Letters of Credit held in the STO Vault that are pledged to or owned by the State of California. It is responsible for the custody and protection of securities and items inside the vault as well as the physical security of the vault. The unit also performs the STO courier duties to deliver and collect warrants, cash, bank receipts, claim schedules, and other financial documents required for day-to-day operation of the State’s Centralized Treasury System.