At its September 11, 2012, regular meeting, the Board of Education requested that staff research potential ways to expand and diversify the banking services of Guilford County Schools (GCS) and to consider qualifications and requests from any bank that would be interested.

A Request for Qualifications (RFQ) for Investment Services was issued by GCS on October 26, 2012. The purpose of the open-ended RFQ is to build an active list of qualified firms who are capable of providing GCS investment options in compliance with N.C. G.S. § 115C-443. These firms will be eligible to participate in a bidding process for investments when funds become available.

Firms qualify for inclusion on the active list based on the following:

1.The firm’s understanding of the products and services required;

2.The firm’s background and related experience;

3.The firm’s acceptance of the terms of the contractual agreement included in the RFQ; and

4.The firm’s compliance with the following minimum requirements:

a.Authorization to do business within the State of North Carolina;

b.FDIC (Federal Deposit Insurance Corporation)-insured institution;

c.Pooling method of deposit collateralization;

d.Licensed within the State of North Carolina to sell investment products such as those required by GCS;

e.Possess such other licenses and/or registrations necessary to operate its business;

f.Current financial strength (credit) rating of A or better from A. M. Best Company (comparable ratings from Moody’s, Standard and Poor’s, or other national rating service will be acceptable).

The RFQ was submitted via e-mail to the following twenty financial institutions:

*merged with Capital Bank

Advertisements were placed in the News & Record, the High Point Enterprise, the Carolina Peacemaker and posted on the GCS website.

An Invitation to Bid (ITB) on the investment of $2 million accompanied the RFQ. This amount was selected as significant enough to generate interest from local financial institutions without creating a hardship on the district’s cash flow. Firms wishing to qualify for consideration in the investment of the $2 million were to submit all RFQ required documentation along with Bid Response Forms to the GCS interim purchasing officer’s office no later than 2:00 PM, EST, on Tuesday, November 13, 2012.

The purchasing office received six (6) responses prior to the deadline. Four responses were from financial institutions declining participation at this time (BB&T, Bank of Oak Ridge, First Citizens, Mechanics and Farmers). The response from American Bank & Trust was incomplete. Bank of America Merrill Lynch (BAML) submitted the only response qualified for consideration.

Review of BAML’s bid reflects the following:

Given that GCS earned .482% in October 2012 on funds invested in the Short Term Investment Fund (STIF) with the NC State Treasurer, staff will continue investing all funds not required for daily operations in the STIF account.