Pasadena’s Bank Holdings: All Secure, Says City’s Finance Director

The City of Pasadena’s bank holdings are secure, according to Finance Director Matthew Hawkesworth.

Hawkesworth’s assessment came after several US and international banks failed in March and liquidity crises erupted at others.

Hawkesworth sent his assessment to City Manager Miguel Márquez on Thursday, April 6.

The City of Pasadena’s main banking relationship is with Bank of America, Hawkesworth wrote, and the City does not have any depository agreements or deposit accounts with SVB, Signature Bank, or First Republic Bank.

But even if the City did, he pointed out, California Government Code requires California banks to collateralize all public fund deposits in excess of the federally insured $250,000 FDIC insurance limit. For that reason, event City amounts in excess of $250,000 were collateralized.

Hawkesworth also noted that Moody’s and S&P, the two prominent credit rating agencies, have placed First Republic Bank, Zions Bank, Western Alliance, Comerica, UMB Financial, and Intrust Financial at a negative watch. 

He wrote that the City of Pasadena has no depository agreements, liquidity facilities, or other relationships with these banks those banks.

The City invests in corporate bonds as part of its investment program and has invested in corporate bonds issued by different banks in its pooled investment portfolio, including a $5 million bond issued by Credit Suisse, which matures in August 2026.

After UBS’s acquisition of Credit Suisse on March 20, Moody’s credit rating agency reaffirmed the bond’s A3 credit rating and assigned the issuer a positive watch for a potential future credit upgrade.

Hawkesworth said the City’s Finance Dept., continuously monitors financial markets, the creditworthiness of the banks and other financial institutions it uses and takes appropriate actions when necessary.