NYCLASS is a local government investment pool serving New York municipal corporations. NYCLASS has issued the following statement in light of the recent developments regarding Silicon Valley Bank and Signature Bank (collectively, the “failed banks”) and the resulting market uncertainty.

NYCLASS did not have any direct exposure to any failed banks, nor did NYCLASS have financial relationships with any of the failed banks. In fact, all of NYCLASS’s bank exposure is within the FDIC insurance coverage limits and/or fully collateralized. The failed banks generally operated in a different banking sector than traditional banks and, as a result, we believe that, based on credit fundamentals, the risk should not be systemic. The Federal Reserve has created a Bank Term Funding Program to backstop the entirety of the banking system; however, recent market events suggest that investor behavior warrants enhanced due diligence.

NYCLASS’ cash deposits are fully collateralized and maintained with a diverse group of financial institutions. Our disciplined investment process continually evaluates the strength and capitalization of our U.S. money center and regional counterparties, and indicates asset quality is strong, net interest margins are robust, and funding is solid in the fixed-income markets.

NYCLASS does not expect the closure of the failed banks to have any impact on our operations. We will continue to monitor the situation and any impact on NYCLASS or our participants.