(a) The assets of
the permanent fund may be invested in the following fixed-income investments:
(1) obligations of, or obligations insured by
or guaranteed by, the United States or agencies or instrumentalities of the
United States;
(2) obligations
secured by reserves paid in by the United States or agencies or
instrumentalities of the United States or obligations of corporations in which
the United States is a shareholder or member;
(3) certificates of deposit and term deposits
of United States domestic banks that are members of the Federal Deposit
Insurance Corporation and that may be readily sold in a secondary market at
prices reflecting fair value or that are fully secured at all times as to
payment of principal and interest as described in (b) of this
section;
(4) certificates of
deposit and term deposits of federally chartered savings and loan associations
in the state that are fully secured at all times as to payments of principal
and interest as described in (b) of this section;
(5) certificates of deposit and term deposits
of mutual savings banks in the state that are fully secured at all times as to
payments of principal and interest as described in (b) of this
section;
(6) fixed-term
certificates of indebtedness of federally insured credit unions in the state
that are fully secured at all times as to payments of principal and interest as
described in (b) of this section;
(7) debt instruments that have been issued by
domestic entities and that are rated investment grade, or debt instruments of
comparable quality issued by nondomestic entities;
(8) debt instruments that have been issued by
domestic or nondomestic entities that are rated below investment grade or are
unrated;
(9) short-term
(A) promissory notes that have been issued by
domestic entities and that are rated investment grade; or
(B) promissory notes of comparable quality
issued by nondomestic entities;
(10) short-term promissory notes that have
been issued by domestic or nondomestic entities that are rated below investment
grade or are unrated;
(11) bankers'
acceptances drawn on and accepted by United States banks each of which has a
combined capital and surplus aggregating at least $200,000,000;
(12) repurchase agreements and reverse
repurchase agreements, the securities underlying the agreements being any of
the items listed in (1) - (6) of this subsection;
(13) the portions of business and industrial
loans made under the Rural Development Act of 1972 that are guaranteed by the
Farmers Home Administration;
(14)
the guaranteed portion of Farmers Home Administration loans;
(15) certificates of deposit, term deposits,
or bankers' acceptances, that are issued by a United States or nondomestic bank
or trust company located outside of the United States and are denominated in
United States or nondomestic currency if either
(A) those instruments may be readily sold in
a secondary market at prices reflecting fair value; or
(B) the issuing bank or trust company has
capital, surplus, and retained earnings at the date of issue equaling at least
$500,000,000;
(16)
securities of nondomestic governments and nondomestic government agencies, the
principal of, or interest on, which is payable in either United States dollars
or nondomestic currencies;
(17)
taxable or tax-exempt municipal or state debt instruments whether supported by
revenues, general obligations, or guarantees;
(18) shares in a money market, exchange
traded fund (ETF), or short-term investment fund that has either collateral
securities of a type authorized elsewhere in this section as acceptable
collateral or securities of similar quality to those authorized elsewhere in
this section as acceptable collateral;
(19) fixed-income derivatives, including
forwards, futures, options, collateralized securities, structured notes, and
swaps, including credit default swaps;
(20) debt instruments issued by an investment
entity described in
15 AAC
137.450(a)(1)(B).
(b) Except for investments made
under (a)(15) of this section, certificates of deposit or the equivalent
instruments that are not of a quality that may be readily sold in a secondary
market at prices reflecting fair value must be secured by a pledge as
collateral of
(1) investments authorized for
the permanent fund under (a)(1), (2), or s(4) of this section;
(2) obligations of the State of Alaska or
instrumentalities of the state that are rated at least "A" by a major bond
rating service and have a demonstrated secondary market; or
(3) letters of credit issued by an agency of
or enterprise sponsored by the United States government, including the
Government National Mortgage Association, the Federal National Mortgage
Association, and the Federal Home Loan Mortgage Corporation.
(c) Investments or obligations
pledged as collateral under (b) of this section must have value at least equal
to the face value of the certificates of deposit being secured. The APFC may
require substitution of collateral in order to ensure continued satisfaction of
the requirements set out in (b) of this section.