S000000143 Global Custody Services Q and A~1.pdf

# Question Reference Question

General Questions- Technical

Proposal Packet-S000000143 What is the funds fiscal year-end?

General Questions- Technical

Proposal Packet-S000000143

In addition to the information in the RFP, are there any areas of focus that may be of particular concern for your Client, or that have prompted the request for information, that would assist us in customizing our RFP response?

General Questions- Technical

Proposal Packet-S000000143

Technical Proposal Packet-S000000143, Information For

Evaluation-Solution section notes:

?Using this template, Prospective Contractors should include a narrative to address and provide a high-level overview of the solution and/or approach proposed using the requirements outlined in the Solicitation.?

Is there a template you would like us to use as one was not provided?

Accounts and Market Value-

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Please provide a holdings reporting in excel with the following information:

Date (holdings as of)

Account/Fund Name

Number of Shares

Valid Security Identifiers (CUSIP, Sedol)

Security Name

Market Values

Accounts and Market Value-

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Market Value of any bank loan assets and annual transactions

Total number of individual positions held by country.

Accounts and Market Value-

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Please supply a breakdown, by type, of the funds (mutual funds, commingled funds, limited partnerships, hedge funds, etc.)

Please note that we are primarily interested in the total number of fund investments and not in the number of accounts the fund investments are held (if the totals vary).

7 Transactions-S000000143

Please provide the following information:

Number of buy/sell trades per annum, by country held

Number of wires

Number of Derivative transactions (Swaps, Options, Futures)

8 Cash Management-S000000143

What is the estimated average daily cash balance held in the current custodians sweep vehicle?

What type of constant net asset value (CNAV) Money Market

Funds (MMF) are you permitted to invest in?

9 Cash Management-S000000143 Are you allowed to invest in Prime fluctuation net asset value

(FNAV) MMF?s? If yes, is this under consideration?

10 Cash Management-S000000143 Are you comfortable with Bank balance sheet deposits? If yes, what range of rates are you currently receiving?

11 Cash Management-S000000143

For cash that is kept at your Demand Deposit Account (DDA)

Banks, does excess amounts get swept out nightly and invested in MMF?s? If yes, which funds (cusip and/or ticker)?

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Written Questions

State of Arkansas-Arkansas Treasurer of State’s Office

Global Custody Services

12 Cash Management-S000000143

Do you have MMF investment concentration limits? If yes, is it a set dollar amount or a % of the Asset Under Management of a specific fund?

Can you provide a list of MMF?s that you currently invest excess overnight cash in? And can you share your reasoning behind choosing these funds?

13 Cash Management-S000000143

For commercial paper (CP), do you transact directly with a CP trading desk at a specific institution? If yes, who and how many?

Do you use Bloombergs? BOOM for your CP trading activity?

What type of CP are you authorized to buy? Is it rating based or do you underwrite specific names?

14 Cash Management-S000000143 Are you familiar with the FDIC Insured Cash Sweep product?

Would you consider investing in this category?

15 Cash Management-S000000143 Are you familiar with Short Duration Exchange Traded Funds

(ETF)?s? Would you consider investing in this category?

REPO Trading and Related Services-

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Does Arkansas trade repo today?

If yes, does Arkansas invest cash, or raise cash? What collateral types, tenor ? overnight or term, haircuts? How many dealer relationships?

REPO Trading and Related Services-

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Is Arkansas looking to invest cash and buy repo as an investment or is repo a way to raise cash (example: Arkansas raising cash, repo out agency mortgage bond collateral)?

Does Arkansas require the custodian to be a bilateral repo counterparty?

REPO Trading and Related Services-

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Is Arkansas familiar with and trade FICC Sponsored Cleared

Repo ?

If so, is this as a cash or collateral provider?

If not, please note that FICC requires representation that

Arkansas entity is a Qualified Institutional Buyer (QIB) and transacts under NY Law.

If interested in pursuing FICC Repo, is Arkansas a QIB and able to transact under NY Law?

REPO Trading and Related Services-

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What investment options would Arkansas consider for late night investment?

When does Arkansas know their final cash number to be invested?

How stable is that end of day balance ?

Performance Measurement and related services-S000000143

Please indicate if the following services are utilized today or if there is an interest in the following:

Monthly returns

Analytics or look-thru analytics

Custom benchmarks

Monthly Attribution

Universe Comparison (Peer and Manager Universes)

Compliance Monitoring

If yes, daily or monthly?

21 Providing a Price Quote Could you provide the average monthly transaction volumes for this portfolio?

22 Providing a Price Quote

What is the portfolio's target allocation of the Money Market

Funds? Would you consider using a providers proprietary Money

Market Fund?

Section 1.2 Global Custody Provider

RFP document

Could you explain what the live proposal opening? Did this event already occur?

24 Plan volumes and service needs

Please provide an account schematic showing the number of accounts with your current custodian and an indication as to whether they are actively managed (discrete securities) or line items (mutual funds/hedge etc.)

25 Plan volumes and service needs

Please provide an Excel based asset list for each account

(separately managed and single line asset) that includes the asset description, market value in USD and country of settlement

(where the asset is held by the current custodian).

26 Plan volumes and service needs

Please provide annualized trade volumes for the following if applicable for your portfolio:

? # of US equity trades

? # of US corporate bond trades

? # of US Government bond trades

? # of US Agency trades

? # of Non-U.S. trades by country and currency

? # of US single line asset trades by each asset type - MF trades, LP transactions, Hedge Funds, Capital Calls etc

? # Bank loan transactions

? # of third party FX transactions

? # futures/option buy/sells

? # of margin movements

? # of OTC and Exchange traded derivatives buy/sell transactions (separate buy and sell listing)

? # of outgoing wire transfers

27 Plan volumes and service needs Are performance measurement services required and, if so, which services?

28 Plan volumes and service needs Please provide the average balance invested in the STIF offered by the current custodian.

29 RFP, page 9, Section 2.7c.:

Under required services Contractual Settlement is specified.

Given the low rate of fails in U.S. markets will you accept Actual settlement?

30 RFP, page 8, Section 2.5j.:

In regard to your requirement that the Contractor shall have an overnight investment vehicle for all funds remaining in or received by the Office account(s) after 3 p.m. central time each day. Can you advise if a 2 p.m. CT cutoff is acceptable if the 2 p.m. sweeps projected cash (settlements and pending cash disbursements/receipts)?

31 RFP, page 4, Section 4.b.:

Is the Voluntary Product Accessibility Template (VPAT) applicable? If yes, can the Department provide a copy?

RFP, page 11, Section 2.16-

Performance Standards:

Subsection A indicates that State law requires qualifying contracts for services include Performance Standards. Is it required that the contract for these custody services include

Performance Standards? If yes, would custodian be subject to monetary or other penalties if it does not satisfy such standards?

MASTER-Solicitation Terms and

Conditions, page 6, Section 21:

Which of the specific standards within the State?s shared

Technical Architecture Program shall apply to global custody services?

34 Services-Contract, page 4, Item 11:

a. Can the Department provide copies of Executive Order 98-04 and the Regulations pursuant thereto?

b. Is the ?Contract and Grant Disclosure and Certification

Form? (?Form?) the same as the ?Attachment #1-Certification of

Contractor?? If not, can the Department provide a copy of the

Form?

Services-Contract, page 8, Attachment #1-Certification of

Contractor:

Subsection B. requires a ?List of any other contracts or subcontracts Contractor has with any other state government entities?, and other text in that Attachment #1 use lower-case

?state?. Is lower-case ?state? making reference to Arkansas?

36 2.13 Disaster Recovery Plan (E)

We conduct tests for Disaster Recovery at pre-determined schedules during the year. We usually do not perform testing on a one off basis. Please clarify or provide additional color for this request.

37 2.13 Disaster Recovery Plan

Disaster Recovery is proprietary to most financial organizations.

Since Public Fund bids can be subject to FOIA requests and/or

Sunshine Laws, we may offer an alternative such as an information sharing session

38 1.8 Response Documents 3(g)

Internal Policies such as EEOC are proprietary Since Public

Fund bids can be subject to FOIA requests and/or Sunshine

Laws, we may offer an alternative such as an information sharing session or a comfort letter

39 2.11 Audit & Control

Internal Audit Reports and SOC Reports are proprietary. Since

Public Fund bids can be subject to FOIA requests and/or

Sunshine Laws, we may offer an alternative such as an information sharing session where you can view the documents and confirm that the controls are sufficient to satisfy your requirements.

2.13 DISASTER REOVERY &

BUSINESS CONTINUITY 3 (C)

Could you provide an example of what you are currently receiving for this requirement. "The Contractor shall furnish to the Contract Administrator or their designee an electronic daily report delineating the completion of that day?s backup, the status, and catalog of items backed up" We back up our systems but I don't believe I have ever seen a report like this for distribution to a client.

41 Section 2.14 ? Pricing Structure

- Can a Prospective Contractor provide a separate pricing model in addition to the one requested in the MAP Price Sheet document?

Services Contract (SRV-1) Fillable

Form

To what extent the terms included within the SRV-1 form negotiable?

Services Contract (SRV-1) Fillable

Form

Would the Office be willing to accept a Prospective Contractor?s standard custody contract?

Section 2.13 ? Disaster Recovery &

Business Continuity

Would a Prospective Contractor risk disqualification if it did not meet all the stated requirements related to disaster recovery / business continuity?

Section 2.13: Disaster Recovery &

Business Continuity

To what extent would the Office be willing to consider alternative procedures around business recovery?

46 Section 2.5: General Requirements Can the Office please share an updated account schematic?

47 Section 2.5: General Requirements Can the Office please confirm whether accounting services are in scope for this RFP?

48 Section 2.5: General Requirements

Can the Office please provide the following: 1) Expected number of individual accounts, total number of CUSIPs and average

CUSIP per account; 2) A sample settled positions report and account statement report; 3) Average monthly transaction count in 2021 and YTD2022

49 Section 2.5: General Requirements

Does the Office utilize its current custodian?s sweep platform ?

is it active or passive? Can the Office provide average cash balance, currency, investment cutoff time and ticker for current fund(s) it sweeps to?

50 Section 2.5: General Requirements

Does the Office participate in a deposit program with your current custodian? If so, can the Office provide average cash balance and currency? If not, would the Office be open to leaving participating in a deposit program with the new Contractor?

51 Section 2.5: General Requirements For cash movements, what is the Office?s method of instruction

(e.g. SWIFT, Fax)

Answer

30-Jun

The ability to implement on the Arkansas Treasury's requisite timeline.

Prospective Contractors may use the blank page provided as a template to submit their response to the Solution portion.

See , "Attachment A State of Arkansas Investment

Holdings Report 6-30-22 "

The Arkansas Treasury neither holds nor transacts bank loan assets. Please see "Attachment B Permitted

Investments and Restrictions 7-15-22. " All assets are dollar denominated. All Commercial Paper is held in DTC.

See , "Attachment A State of Arkansas Investment

Holdings Report 6-30-22 "

See RFP for trade and wire numbers. See " Attachment B

Permitted Investments and Restrictions 7-15-22. "

Ideally, the daily cash balance should be zero--though there are infrequent exceptions. See , "Attachment B Permitted

Investments and Restrictions 7-15-22."

See, " Attachment B Permitted Investments and

Restrictions 7-15-22. "

No.

No. Our DDA does not have a sweep attached to it.

Excess funds are manually moved to a MMF.

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Written Questions

State of Arkansas-Arkansas Treasurer of State’s Office

Global Custody Services

See "Attachment B Permitted Investments and Restrictions

7-15-22. " Also see, "Attachment C State of Arkansas

Money Market Report 6-30-22"

The Arkansas Treasury utilizes multiple dealers through

Bloomberg BOOM. See, "Attachment B Permitted

Investments and Restrictions 7-15-22. "

Yes, the Arkansas Treasury is familiar with the FDIC

Insured Cash Sweep product. That product is not under consideration at this time.

See, "Attachment B Permitted Investments and

Restrictions 7-15-22 ."

We are not currently trading repurchase agreements at this time.

See, "Attachment B Permitted Investments and

Restrictions 7-15-22 ."

See, "Attachment B Permitted Investments and

Restrictions 7-15-22 ."

Not applicable.

The Arkansas Treasury was not using these products with or through its previous custodian. The Arkansas Treasury is always interested in products that could maximize the services it provides to the citizens of Arkansas. However, those items are not within the scope of this RFP.

Prospective Contractors should utilize the Recommended

Options form to propose services related to the scope of this RFP.

Please see Section 2.1 of the RFP.

The Arkansas Treasury does not have a target allocation for MMFs. The Arkansas Treasury is always interested in products that could maximize the services it provides to the citizens of Arkansas. However, those items are not within the scope of this RFP. Prospective Contractors should utilize the Recommended Options form to propose services related to the scope of this RFP.

The live proposal opening will take place at the Proposal

Opening Date/Time specified on page one of the RFP.

See, "Attachment F Account Schematic "

See, "Attachment A State of Arkansas Investment Holdings

Report 6-30-22 "

See, "Attachment A State of Arkansas Investment Holdings

Report 6-30-222 "

Performance measurement services are not required.

The Arkansas Treasury is always interested in products that could maximize the services it provides to the citizens of Arkansas. However, those items are not within the scope of this RFP. Prospective Contractors should utilize the Recommended Options form to propose services related to the scope of this RFP.

Sweep accounts are used infrequently and only when necessary.

Contractual Settlement is preferred at this time.

No. 2 p.m. is not acceptable.

If required, the VPAT template can be found at https://www.section508.gov/sell/vpat/ .

Performance standards can be negotiated during the

Discussions Phase.

Prospective Contractors should review the policies to determine if their proposal complies with the policies and standards set forth in the Technical Architecture Program.

A copy of the Contract and Grant Disclosure form is posted with the solicitation.

Attachment #1 references lower-case 'state'. Prospective

Contractors can discuss with the State how extensive this response should be during the Discussions Phase.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised .

It is allowable for a Prospective Contractor to submit a separate pricing model. However, only the MAP Price

Sheet will be evaluated for Cost Score.

Per Section 1.10 of the RFP, please include any exceptions to the SRV-1 form on the Exceptions Form.

Per Section 1.10 of the RFP, please include any exceptions to the SRV-1 form on the Exceptions Form. This should include proposing additional language.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised.

Please see Section 2.13 of S000000143 Global Custody

Provider RFP Revised .

See, "Attachment F Account Schematic "

The Arkansas Treasury is always interested in products that could maximize the services it provides to the citizens of Arkansas. However, Accounting Services are not within the scope of this RFP. Prospective Contractors should utilize the Recommended Options form to propose services related to the scope of this RFP.

The Arkansas Treasury currently has 7 subaccounts. See, Attachment D Positions Report , Attachment E Daily

Transactions, and Section 2.1 of the RFP for average transactions.

Yes. However, sweep accounts are only used when necessary. Ideally, the Arkansas Treasury carries zero cash balance. The current custodian's sweep platform is used infrequently.

No. The Arkansas Treasury is always interested in products that could maximize the services it provides to the citizens of Arkansas. However, those services are not within the scope of this RFP. Prospective Contractors should utilize the Recommended Options form to propose services related to the scope of this RFP.

The Arkansas Treasury currently uses wire transactions within the current custodian's proprietary system.