1. INTRODUCTIONThe U.S. Small Business Administration (SBA) Office of Credit Risk Management (OCRM) is responsible for overseeing lenders that participate in the 7(a) and 504 SBA loan guaranty programs. OCRM?s mission is to maximize the efficiency of SBA?s lending programs by effectively managing program credit risk, monitoring lender performance, and enforcing lending program requirements. One of the tools used by OCRM to carry out its mission is the Loan and Lender Monitoring System (L/LMS). The purpose of L/LMS is to identify, measure, and manage risk in 7(a) and 504 programs. It does this specifically by developing predictive ratings that allow SBA to improve the performance of the two programs using risk management principles. The system analyzes SBA loan data, Dun & Bradstreet business data, and data provided by subcontractors, including consumer credit bureau information and business credit scores. It uses a commercially available suite of scorecards to produce business credit scores that predict the likelihood of an SBA loan becoming severely delinquent over the next 18 to 24 months. It also contains trend databases that provide historical data on each loan level. Part of the L/LMS provides lender risk rating scoring. It assigns each lender a composite rating based on certain portfolio performance factors. SBA lenders would have access to their own ratings through SBA's Lender Portal. 2. OBJECTIVE As part of SBA?s continued loan portfolio credit risk management and lender oversight efforts, the Agency will obtain credit risk management support and program management support. SBA is seeking to apply credit risk prediction and evaluation to its 7(a) and 504 loan portfolios. The objective of this Sources Sought Notice is to seek information about small businesses that are capable of providing the services. Please note that this is a market survey for informational purposes only and is not a Solicitation. There is no solicitation document available at this time; no contract will be awarded based on this announcement; and no reimbursement will be made for costs associated with responding to this announcement. All responses must be submitted via e-mail in accordance with the instructions that follow. 3. REQUIREMENTS The vendor shall provide a Credit Risk Predictive System consisting of multiple predictive scoring models at the loan level for SBA 7(a) and 504 portfolios to generate validated quarterly credit scores for each SBA 7(a) and 504 active loans and include both commercial and personal credit, to the extent available, within the credit scoring model(s). The scoring models within the System shall utilize a state-of-the-art, commercially available off-the-shelf product that represents a nationally recognized commercial scoring product using nationwide credit data. The purpose of having the models is to utilize the credit scores and such portfolio performance variables that, in combination, provide a highly predictive likelihood of purchase (by SBA) on active 7(a) and 504 loans guaranteed by the Agency within a reasonable period of time and to be indicative on each portfolio?s trend development. The vendor shall compile the information generated by the Credit Risk Predictive System, including but not limited to credit scores, borrowers? consumer and corporate information together with the SBA mainframe loan information into a data warehouse, maintained and hosted by the vendor. This data will be accessed by utilizing a front-end software application provided by the vendor. The vendor shall provide a Lender Risk Rating System consisting of multiple predictive scoring models. The System shall assign a rating score, on a scale of 1 to 5 for each SBA lender [consisting of 7(a) participating lenders and 504 Certified Development Companies (CDC)], with an SBA active portfolio, on a quarterly basis. A rating of 1 would indicate strong portfolio performance, least risk, and the least degree of SBA management oversight needed (relative to other Lenders in their peer group), while a rating of 5 would indicate a weak portfolio performance, highest risk, and therefore, the highest degree of SBA management oversight. The vendor shall create and host a database called the Lender Information Portal (Portal). The database will contain SBA participant lenders? portfolio performance ratios, average loan credit scores, cumulative cash flow information, peer group performance, overall portfolio performance, lenders? risk ratings and any additional data as directed by SBA. The database shall have a user friendly web-based application, available online to participating 7(a), 504 lenders and SBA staff. The vendor shall conduct the portfolio analysis on the SBA?s 7(a) and 504 programs on a monthly, quarterly, and annual basis. The result of the analysis shall be compiled into various reports. Finally, in addition to the monthly, quarterly, and annual portfolio analysis and reporting, the vendor shall conduct ad hoc analysis and reporting at the request of SBA. 4. INSTRUCTIONS Responses to this announcement must provide detailed, concise information about the experience in providing services similar to those described above, within the past five (5) years. Information shall include the contract number, dollar value, period of performance, current status, performance measurements (planned vs. actual) and current Government point of contact information including name, address, telephone number, and e-mail address. In addition, the response must state small business size status (small; 8(a); small disadvantaged; HUBZone, service disabled, veteran owned, etc.). The response should not exceed five (5) pages. Responses must be submitted electronically to [email protected] no later than January 3, 2008.

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