Federal Deposit Insurance Corporation, 550 17th Street, NW, Washington, DC 20429

B -- ECONOMETRIC MODELS Contact Point, Larry Guthrie, Sr. Contract Specialist, 202-942-3255. The FDIC is seeking sources to indicate interest in providing services which will improve the FDIC's capability to evaluate the effect of changing economic conditions on bank performance. This includes economic conditions at the local, regional, national, and international level. THIS IS NOT A REQUEST FOR COMPETITIVE PROPOSALS. The purpose of this notice is to develop a list of qualified firms who can provide this service. Organizations are invited to submit a conceptual approach to accomplish FDIC's goals and complete information discussing the following qualifications and experiences: (1.) Experience in the use of economics and financial market data in developing econometric models. The contractor must demonstrate experience in using economic and financial market data in evaluating the performance of industries and/or individual firms operating in international, national, regional or local markets. Such experience would include the use of econometric techniques to estimate reliable statistical relationships between industry or individual firm performance and economic and financial market data. (2.) Knowledge of data sources. The contractor must demonstrate detailed knowledge of the sources, uses, and limitations of statistical data on economic and financial market activity in the international arena, states, metropolitan areas, and counties of the United States. (3.) Ability to handle large-scale projects. The contractor must demonstrate an ability to handle large-scale projects effectively and to deliver work product on a timely basis. (4.) Specific information on how this requirement can be satisfied. The contractor must outline key issues for consideration and a conceptual approach. Background: In carrying out its mission, the Federal Deposit Insurance Corporation (FDIC) seeks continually to improve its ability to assess the impact of external developments on bank performance, evaluate the risk exposure of individual and groups of banks, identify potential problem banks, and anticipate bank failures. To this end, the FDIC has developed and made use of econometric models that utilize institution-specific financial report data, examination ratings of individual banks, and (to a limited extent) national economic data. At this time, the FDIC seeks to improve the effectiveness of these models through the development of an approach that utilizes international, national, and regional economic and financial market data. This approach would recognize that individual banks serve markets that vary greatly in geographic scope, with many small banks serving highly localized markets and some large banks operating on a broader regional or even national basis. This approach would also recognize that the data requirements for reliable statistical models might vary for different groups of banks; local economic data might have the greatest explanatory power for the performance of many small banks, while broader regional, national, or international economic data might be appropriate for some large banks. Requirements: In order to accomplish this goal, the contractor would be expected either: (1) to develop; or (2) to assist the FDIC in developing, a new statistical model(s) using international, national and regional economic and financial market data which substantially improve on the capabilities of the FDIC's existing models to identify reliable statistical relationships between economic variable and bank performance. The specific role of the contractor would be determined by the FDIC and would depend in large part on the particular experience and capabilities of the contractor. In either case, the contractor would be expected to prepare and submit for FDIC approval a detailed project plan for development of the new model(s). The statistics utilized in the development of the new model(s) would include existing FDIC data on banking performance and structure. They would also include national and regional economic and financial market data currently available at the FDIC. As agreed to by the contractor and the FDIC, these data might be supplemented by additional economic and financial data not now available at the FDIC. Responses are required on or before November 18, 1996. Firms responding to this announcement which fail to provide the required information may not be considered for inclusion into any resulting source list. Facsimile and telephone responses will not be accepted. (304)

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