Solution en matière de capital économique

REQUEST FOR PROPOSALS – TE25-LA-004 Economic Capital (ECAP) Solution RFP

ABOUT FCC

FCC is proud to be 100% invested in Canadian agriculture and food. Our employees are committed to the long-standing success of those who produce and process Canadian food. FCC provides flexible financing and capital solutions, while creating value through data, knowledge, relationships and expertise. FCC offers a complement of financial and non-financial products and services designed to support the complex and evolving needs of the industry. As a commercial Crown corporation, FCC is a stable partner that reinvests profits back into the industry and communities it serves. For more information, visit fcc.ca.

RFP CONTACT

Lisa Achtemichuk
Procurement and Vendor Manager
Farm Credit Canada
i••••••••@•••.ca

RFP SCOPE

FCC is Canada’s leading agriculture lender, with a healthy portfolio of more than $61 billion. As it relates to this RFP, the key aspect of FCC’s business is offering financing products to individuals and companies in agriculture related industries in Canada. Lending products include standard loans with variable or fixed interest rates and many term, amortization, and payment frequency options. At September 30, 2025, FCC’s loans receivable accounted for approximately $58 billion of its $61 billion in total assets.

FCC is essentially a mono-line company that is almost entirely exposed to the Canadian agriculture, agribusiness, and agri-food industries. Although FCC is diversified among sectors within agriculture and across geographies in Canada, it tends to have more risk concentration than other financial institutions that can diversify across industry, countries, and lines of business. As such, FCC’s current credit risk economic capital requirements are heavily influenced by the asset and factor correlations that exist within the loan book.

Resiliency and long-term viability are key themes in FCC’s strategy. A critical way in which these values are reflected is through long-term safe and sound financial and capital management. In particular, FCC’s Internal Capital Adequacy Assessment Process (ICAAP) ensures that FCC remains financially prudent while deploying capital in an impactful way. FCC’s ICAAP is consistent with the Office of the Superintendent of Financial Institutions (OSFI) guidelines, which align Canadian banking regulations with the Basel framework.

As part of its ICAAP, FCC determines the amount of capital required to fund its strategic plans while maintaining an appropriate capital position sufficient to withstand economic downturn with periods of extended loss. Estimating capital requirements involves quantifying the material risks faced by FCC through economic capital (ECAP) modeling, a stress testing program, and other industry accepted approaches.

Credit risk economic capital is the single largest risk category facing FCC (from a capital perspective) and is currently measured as the capital required to withstand unexpected losses at a 99.93% confidence level over a one-year time horizon based. The unexpected losses are based on the loss frequency (probability of default (PD)) and loss severity (exposure at default (EAD) and loss given default (LGD)) of FCC’s loan portfolio. The key inputs mentioned above (PD, EAD, and LGD), along with portfolio concentration factors (i.e. asset/factor correlations) are estimated by FCC and provided to a third-party system to calculate the credit risk ECAP requirements.

Aside from ensuring an appropriate amount of capital is held, FCC uses economic capital to perform scenario analysis to inform exposure thresholds for certain segments of the portfolio. In addition, economic capital is a critical component in how the organization measures and plans to meet its performance objectives (e.g. return on equity, risk-adjusted return on capital). A key way of integrating this capital planning into business operations is through calculating a capital charge for loan pricing purposes. Economic capital, particularly for credit risk, is attributed at the loan level to inform these pricing considerations.

The level of scrutiny regarding FCC’s capital deployment is increasing due to recent changes to its strategy, risk appetite, and guidance from the government. Therefore, there is more visibility and importance on FCC’s credit risk economic capital modeling.

For further details, refer to the RFP and Appendix A (RFP Schedule, Evaluation Process, Scope and Proposal Instructions) documents that are uploaded to MERX.

RFP PARTICULARS

All conditions for Proponent participation are included in the RFP documents.
Duration of Contract: Up to 10 years
Estimated Quantity of Goods or Services:  Not applicable
Timeframe of Delivery of Goods or Services: Not applicable

RFP SCHEDULE

RFP Release Date:  March 2, 2026
Proponent Questions Accepted Until:  March 10, 2026, 2:00 PM
FCC Response to Proponent Questions Delivered Before:  March 23, 2026 5:00 PM
RFP Closing Date/Time: April 2, 2026 2:00 PM

NOTE: All times are CST – Saskatchewan. The above dates are subject to change at the sole discretion of FCC. Any changes to the RFP Schedule will be communicated to all Proponents via amendment on MERX.

RFP PROCESS CONSIDERATIONS

This opportunity is covered under the provisions of Chapter 5 (Government Procurement) of the Canadian Free Trade Agreement (CFTA) and Chapter 19 (Government Procurement) of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA).
FCC is subject to the Official Languages Act (Canada). Proponents may choose to respond to this RFP in their official language of choice (English or French).
This opportunity notice references a non-binding, competitive RFP, and is not a call for tenders. FCC is not obligated to proceed with the Work described in the RFP Scope, and may cancel the RFP at any time. FCC’s procurement process allows for consecutive or concurrent negotiations between FCC and one (1) or multiple Proponents, prior to awarding a Contract.

MERX ELECTRONIC BIDDING SYSTEM

This Request for Proposals (RFP), including any attachments and amendments to such RFP, is available for download by the Proponent on MERX. MERX is a Canadian Public Tenders electronic bidding system accessible at https://www.merx.com. It is the sole responsibility of the Proponent to ensure its compatibility with MERX.
Proponent proposals MUST be submitted electronically through MERX, preferably in a PDF or MS Word file, prior to the RFP Closing Date/Time specified in the RFP. Proposals submitted in other formats, by other methods or through any other means, or after the RFP Closing Date/Time specified in the RFP, may be rejected by FCC.

PRIORITY OF DOCUMENTS

In the event there are any discrepancies between this opportunity notice and the information on the MERX website proper, thisBidding and Documents are available on http://www.merx.com. Fees may apply; See https://www.merx.com/public/pricing for more information.