Appendix 2 TM Prudential Indicators - 30.06.2026

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This appendix reports the Council's treasury management performance for the fourth quarter of 2025/26, measured against benchmarks and the key indicators in the Council's Treasury Management Strategy from February 2025. p2p3

Cash investment balances fell by 74% in one year, from £115.3m to £30.4m at 31 March 2026, while the average investment return over the quarter was 4.19%, which is 0.46 percentage points above the benchmark rate. p4

The report states that the Council is operating within the borrowing limits set in its Treasury Management strategy, with headroom to cover any unforeseen borrowing need from the year's capital programme. p25

Investment risk during the quarter ranged between 0.006% and 0.007%, well within the allowable level of 0.050% set by the Council's investment strategy. p11

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• p2Treasury Management Prudential Indicators – Q4 2025/26
• p3The Chartered Institute of Public Finance and Accountancy published the revised Treasury and Prudential codes in 2021, which now requires quarterly reporting of performance against forward looking prudential indicators. The performance of the Council’s treasury management activity, against benchmarks and the key indicators in the Council’s Treasury Management Strategy, as approved by Full Council at its meeting of 11 February 2025, are set out below. Investments
• p4Cash investment balances as at 31 March 2026 have fallen by 74% in one year, from £115.3m at Q4 2024/25 to £30.4m. The average investment return over Q4 was 4.19% performing above the benchmark rate by 46 basis points (or 0.46 percentage points). Performance has reduced marginally because of maturing investments being placed in a lower interest rate environment and for a shorter duration, due to cashflow.
• p11During Q4 we have monitored the security of the Council’s investments, to assess the risk of those investments losing their value. These risks were assessed using the financial standing of the groups invested in, the length of each investment, and the historic default rates. Our investment strategy sets an allowable risk level of 0.050% (i.e. that there is a 99.95% probability that the Council will get its investments back). The actual indicator ranged between 0.006% and 0.007%, reflecting the high proportion of investments held in highly secure and/or very liquid investments.
• p25The table below shows that the Council is operating within the Operational Boundary and Authorised Borrowing Limits set within the Treasury Management strategy and has sufficient headroom to cover any unforeseen borrowing need arising from the year’s capital programme.