N.J. Admin. Code § 17:4A-7.1

Current through Register Vol. 56, No. 23, December 2, 2024

Section 17:4A-7.1 - Permissible investments

(a) Subject to the limitations in this subchapter, the Board may invest and reinvest PFRSNJ-managed fund assets in state, municipal general, and public authority obligations, provided that:

1. The obligor is not in default as to the payment of principal or interest upon any of its outstanding obligations; and

2. The obligations have a credit rating of at least: Baa3 or higher by Moody's Investors Service, Inc., BBB- or higher by Standard & Poor's Corporation, and BBB- or higher by Fitch Ratings, except that two of the three ratings is sufficient and one of the three ratings is sufficient if only one rating is available. If a rating for the obligations has not been obtained from the above services, the obligations may be purchased, if the issuer rating meets the minimum rating criteria. Subsequent to purchase, if ratings fall below the minimum rating for such obligations, the obligations do not have to be sold, and they may be exchanged with obligations with a credit rating lower than the minimum rating if the obligations received in exchange are, on balance, similarly rated.

(b) Investments made pursuant to this subchapter shall comply with Federal arbitrage regulations, if applicable.

(c) Notwithstanding the restrictions at (a) above, the Board may invest and reinvest PFRSNJ-managed fund assets in: state, municipal, and public authority obligations, global debt obligations, collateralized notes and mortgages, international government and agency obligations, non-convertible preferred stock, and mortgage-backed pass-through securities that do not meet the minimum credit ratings set forth in this section and N.J.A.C. 17:4A-6.1, 7.1, 8.1, 9.1, 15.1, and 17.1, respectively; provided, however, the aggregate market value of such investments shall not exceed eight percent of the total PFRSNJ fund assets.

(d) Notwithstanding the restrictions set forth in this subchapter, the Board may authorize the purchase of state, municipal general, and public authority obligations on a case-by-case basis if the Board determines such purchase to be in the financial best interest of the PFRSNJ and its beneficiaries and is consistent with the Board's fiduciary responsibility.

N.J. Admin. Code § 17:4A-7.1

Adopted by 53 N.J.R. 1147(a), effective 7/6/2021

Recodified from 17:4A-7.2 by 56 N.J.R. 795(a) effective 5/6/2024