PBGC awards $61.8M contract to Pacific Investment Management for investment banking services
Contract Overview
Contract Amount: $61,794,812 ($61.8M)
Contractor: Pacific Investment Management Company LLC
Awarding Agency: Pension Benefit Guaranty Corporation
Start Date: 2008-10-01
End Date: 2016-03-31
Contract Duration: 2,738 days
Daily Burn Rate: $22.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: CFO/CID
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005
Plain-Language Summary
Pension Benefit Guaranty Corporation obligated $61.8 million to PACIFIC INVESTMENT MANAGEMENT COMPANY LLC for work described as: CFO/CID Key points: 1. Contract awarded for investment banking and securities dealing services. 2. Significant contract value of $61.8 million over its duration. 3. Full and open competition was utilized for this award. 4. The contract spans nearly 8 years, indicating long-term service needs.
Value Assessment
Rating: fair
The contract value of $61.8 million over 2738 days suggests a substantial investment in financial services. Benchmarking against similar contracts for investment banking services is difficult without more specific service details, but the duration and value indicate a significant engagement.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically promotes competitive pricing. The fixed-price nature of the contract further supports price discovery and cost control for the agency.
Taxpayer Impact: Taxpayer funds are utilized for this contract, with the expectation of efficient management of pension fund investments to protect beneficiaries.
Public Impact
Ensures professional management of pension fund assets. Supports the financial stability of retirement benefits for plan participants. Potential for optimized investment returns to bolster the PBGC's financial health.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration may lead to price escalation if not managed.
- Dependence on a single firm for critical investment services.
- Potential for market volatility impacting investment performance.
Positive Signals
- Utilized full and open competition.
- Firm fixed-price contract type.
- Awarded to a reputable investment management company.
Sector Analysis
This contract falls under financial services, specifically investment banking and securities dealing, supporting the Pension Benefit Guaranty Corporation's mission. Spending in this sector is crucial for managing financial assets and ensuring long-term solvency.
Small Business Impact
The data indicates this contract was not awarded to small businesses, as the 'sb' field is false. The focus was on securing specialized investment management services from a larger, established firm.
Oversight & Accountability
The Pension Benefit Guaranty Corporation is responsible for overseeing this contract. The long duration and significant value necessitate robust oversight to ensure performance and adherence to fiduciary responsibilities.
Related Government Programs
- Investment Banking and Securities Dealing
- Pension Benefit Guaranty Corporation Contracting
- Pension Benefit Guaranty Corporation Programs
Risk Flags
- Long-term contract duration.
- Sole reliance on one firm for critical services.
- Market volatility impacting investment performance.
- Potential for conflicts of interest in investment banking.
Tags
investment-banking-and-securities-dealin, pension-benefit-guaranty-corporation, dc, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Pension Benefit Guaranty Corporation awarded $61.8 million to PACIFIC INVESTMENT MANAGEMENT COMPANY LLC. CFO/CID
Who is the contractor on this award?
The obligated recipient is PACIFIC INVESTMENT MANAGEMENT COMPANY LLC.
Which agency awarded this contract?
Awarding agency: Pension Benefit Guaranty Corporation (Pension Benefit Guaranty Corporation).
What is the total obligated amount?
The obligated amount is $61.8 million.
What is the period of performance?
Start: 2008-10-01. End: 2016-03-31.
What specific investment strategies and performance metrics are stipulated in the contract to ensure optimal value for the PBGC?
The contract likely outlines specific investment mandates, risk tolerance levels, and performance benchmarks. Detailed reporting requirements would allow the PBGC to monitor the effectiveness of Pacific Investment Management's strategies and ensure they align with the agency's fiduciary duties and financial goals for pension fund assets.
How does the PBGC mitigate the risk associated with relying on a single firm for critical investment banking services over an extended period?
Mitigation strategies may include rigorous performance reviews, clear termination clauses, and diversification of investment management responsibilities if feasible. The PBGC would also likely maintain internal expertise to oversee the contractor's activities and ensure compliance with regulations and best practices in financial management.
What is the expected impact of this contract on the long-term financial health and solvency of the PBGC?
The contract aims to enhance the PBGC's financial health by leveraging expert investment management to generate returns that support its obligations. Effective management of pension assets can improve the agency's solvency ratio, ensuring it can meet its guarantee commitments to participants in failed pension plans.
Industry Classification
NAICS: Finance and Insurance › Securities and Commodity Contracts Intermediation and Brokerage › Investment Banking and Securities Dealing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 6
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Aviva Towarzystwo Ubezpieczen NA Zycie S a (UEI: 320311889)
Address: 2301 HURON ST, BELLINGHAM, WA, 98229
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $62,011,203
Exercised Options: $62,011,203
Current Obligation: $61,794,812
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2008-10-01
Current End Date: 2016-03-31
Potential End Date: 2016-03-31 00:00:00
Last Modified: 2016-09-16
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