Today the NCUA responded to a Feb. 24 Freedom of Information Act (FOIA) request from the Credit Union Times that asked how much the agency paid the private Newport Beach, Calif.-based PIMCO for its analysis, where the funds came from, and the rationale for assessing credit unions the cost.
According to NCUA Staff Attorney Linda K. Dent, the NCUA entered into an agreement with PIMCO on January 29, 2009 to prepare a written report evaluating a portfolio of debt securities at the rate of .0001 of the par value of the portfolios reviewed.
"PIMCO analyzed thousands of complex structured credit securities held across the credit union system with a par value of more than 45 billion dollars. The cost for the report is $4,500,000," Dent said.
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She did not specify if future PIMCO valuations, which NCUA Executive Director said the agency might request, would result in an additional $4.5 million invoice.
The PIMCO deal represents 2.5% of the NCUA's $178 million 2009 budget.
According to a Nov. 20, 2008 release, the NCUA's 2009 budget is 12% higher than last year. Specifically, the travel budget increased 34%, and contracted services increased 29%.
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