Banking, Cash Management and Investments

The Banking, Cash Management and Investment functions for the State Treasury are located in the Financial Administration Division.

The Cash Management section is responsible for ensuring the availability of cash to meet the State’s overall  financial obligations. To carry out this responsibility, the Treasury Management Branch is assigned the tasks of receiving, safeguarding, investing and disbursing all funds in the State Treasury. The State’s cash position is set each business day to ensure that there is sufficient liquidity to meet all of the state’s various cash needs. Receipts from all state agencies are processed and recorded daily, working with the Department of Accounting and General Services to record transactions into the state’s central accounting system.

All State funds deposited with State-appointed depositories (financial institutions) are deemed, under State law, to be deposited in the State Treasury. To protect the deposits, the funds must be fully collateralized by the depository with securities deposited with the Director of Finance as provided in Section 38-2, Hawai`i Revised Statutes (HRS). All funds that are in excess of immediate needs are invested in the types of investments permitted under Section 36-21, HRS. The Investments section works with authorized brokers and financial institutions to invest excess funds in permitted investments, based on the criteria of safety, liquidity and yield, prioritized in that order, to ensure sufficient funds for payment of State obligations.

In the Department’s continuous effort to maximize investment income, an investment pool program for state agencies was implemented in August 1999. The investment pool program centralizes all phases of the investment process under thedirection of the Department of Budget and Finance,thereby pooling the State’s vast cash resources to enhance investment returns.