Specifications include, but are not limited to: 1. This Request for Proposal is to provide the ASTO the ability to contract with an external investment management firm for managing two fixed income pools; the investment grade fixed income pool of approximately one hundred nineteen (119) million dollars and the municipal tax free non-AMT pool of approximately four hundred seventy five (475) million dollars. The municipal pool has a finite termination date of October 1st, 2029. 2. This contract may also include contingency planning for the State of Arizona Treasurer’s Office. The contractor may be asked to perform as a back-up to internal managers in the event of an emergency. The contractor may be required to take additional management responsibilities if an emergency should occur and would need to demonstrate the capabilities of managing all the internal funds shown in Exhibit G. 3. Asset Allocations will be determined by ASTO staff from time to time and those allocations to external managers are to be managed to the duration target and credit profile of each pool’s objective and policy. For any investment pool that has an external credit rating, the external managers shall manage assets for that pool in line with the criteria required to maintain the highest credit rating possible for that pool. (Currently Pool 5 is rated AAAf/ S1+ by S & P) 4. Securities purchased by an external fund manager will be required to be held at ASTO’s custodial bank and will be subject to existing securities lending program operated by the custodial bank. 5. Funds managed by external managers should be considered extensions of the internal investment management team and are expected to follow the quarterly investment plans developed by the internal portfolio managers. 6. Any corporate credit exposure for the fixed income funds is limited to a 5% concentration limit per corporate name per pool assets. 7. Daily market values, holding reports and compliance of external managers will be provided by ASTO custodial bank as well as monthly performance of accounts. Manager performance will be measured against the benchmarks established for each investment pool. 8. External managers are expected to meet at least quarterly with the Investment Risk Management Committee and annually with the Board of Investment.
