53 Pa. Stat. § 23607
The board shall designate and choose such bank or banks, trust company or trust companies, in such city, in which the moneys of the fund shall be deposited, and such bank or banks, trust company or trust companies, shall be selected annually after the board shall have received written proposals as to the rate of interest which shall be paid on such deposits, and the bank or banks, trust company or trust companies, offering to pay the highest rate of interest shall be chosen as the depository or depositories of the fund if the board be satisfied of the soundness of such institution or institutions.
The board shall create and establish a sinking fund into which shall be paid all moneys remaining to the credit of the fund and the depositories of the fund on the first day of each year and after all claims and running expenses of the prior year have been paid; and the moneys in the sinking fund shall not be used for any purpose excepting by a two-thirds vote of the board, but the interest accruing on the moneys in such sinking fund may be used for the payment of the necessary expenses for the operation of the fund.
The board may invest the moneys of the fund and of the sinking fund in such State, county, or municipal bonds of the State of Pennsylvania, or in bonds of the United States Government, as they may deem to the best interest of the respective funds. All such investments shall be made in the name of the respective fund. The accounts of the fund shall be audited annually by the city controller, or oftener if the board requests the same to be done, and a copy of the audit furnished to the council of the city.
53 P.S. § 23607