Nearly a dozen banks are pitching their services to the Florida State Board of Administration (SBA), the entity that manages assets for the Florida Retirement System.
Reported by the Securities Lending Times:
Multiple banks are competing to provide the State Board of Administration of Florida with prime and collateral management services, it has been revealed.
The State Board of Administration of Florida, which manages the state’s public employees’ retirement savings, has received pitches from CitiGroup, Deutsche Bank, Newedge, Bank of America Merrill Lynch and Pershing for prime services.
State Street, BNY Mellon and CitiGroup have submitted pitches to provide collateral management services following the State Board of Administration of Florida’s request for proposals.
A spokesperson said that a decision on the providers is expected by the end of this week.
An explanation of the services the SBA is seeking, from Pensions & Investments:
Prime services include prime brokerage in short-selling of securities, foreign-exchange prime brokerage, as well as clearing for futures, options and over-the-counter derivatives, including swaps, according to the solicitation.
Collateral management includes margin collateral custody and management services related to prime services.
The SBA manages $180.3 billion in assets.
In the latest vote of non-confidence in a post-Bill Gross PIMCO, the Florida State Board of Administration (SBA), the entity that manages investments for the Florida Retirement Systems, has announced it will drastically cut its investments with PIMCO.
From the New York Times:
The investment body overseeing the state of Florida’s retirement system said Tuesday that it would be sharply curtailing the funds that it has allocated to the shaken bond giant.
In a statement, Dennis Mackee, a spokesman for the $147 billion pension fund, said that $1.9 billion in assets managed by PIMCO as a separate investment account for Florida would be “significantly reduced.”
Mackee also said that Florida’s investment plan would be terminating PIMCO’s Total Return Fund and its Inflation Response Multi-Asset Strategy Fund. Together, the funds managed just over $1 billion for Florida retirees.
Adding insult to injury, Mackee said that this money would be steered toward two funds belonging to PIMCO’s archrival, BlackRock.
Mackee said that Blackrock would also be one of several other money managers receiving the separate account money withdrawn from PIMCO.
As with many state retirement funds, Florida had put PIMCO on its watch list after reports that its two leaders, Bill Gross and Mohamed El-Erian, were feuding.
The Florida Retirement System is one of the largest public pension funds in the United States. It manages $147 billion.