OREANDA-NEWS. S&P Global Ratings today said it assigned its 'AAAf' fund credit quality rating on the TexasTERM Local Government Investment Pool Series EE – 1217. The rating is based on our analysis of the credit quality of the portfolio's eligible investments, the counterparties, and overall management.

The TexasTERM Local Government Investment Pool was created by and for Texas local governments. TexasTERM is a professionally managed series of portfolios that is offered to municipalities, counties, school districts, special districts, and other government entities in the State of Texas. Portfolios under the TexasTERM umbrella have an objective: to provide investors with safety, flexibility, and competitive yields.

TexasTERM's investment objective is to provide an investment that can accommodate preset redemptions occurring anywhere from 60 days to one year from the time of investment, and that will produce the highest earnings consistent with preserving principal and meeting the redemption schedule. The portfolio seeks to assure the return of principal on the planned maturity date, although principal value may fluctuate prior to that date and, therefore, may be greater or less than $1.00 a share.

The portfolio will generally consist of obligations of the U. S. government or its agencies and instrumentalities with a 13-month maximum maturity, certificates of deposit issued by Federal Deposit Insurance Corp.-insured banks, money market mutual funds that observe certain investment restrictions, commercial paper, and repurchase agreements collateralized by U. S. government and agency obligations.

PFM Asset Management LLC is the administrator and investment adviser for the pool. As of June 2016, PFM had approximately $65 billion in assets under management with more than 200 employees. U. S. Bank N. A. serves as the custodian bank for the pool.

The 'AAAf' rating signifies the fund's portfolio holdings should provide extremely strong protection against losses from credit defaults. Our credit quality and volatility ratings are based on our analysis of a fund's eligible portfolio investments and strategy, historical return volatility, and management. The seven-category credit quality rating scale ranges from 'AAAf' (highest level of protection) to 'CCCf' (least protection). The ratings from 'AAAf' to 'CCCf' may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories.

Our analysis seeks to identify risk sources in a managed fund's portfolio and investment strategies and to assess the likelihood of losses from credit defaults in the portfolio. We monitor fixed-income funds monthly to ensure the consistency of the funds' credit quality and volatility profiles with the assigned ratings.