Investment of NLC surplus funds (r5.3bn) – 5-Year mandate for fsps and banks

Enquiries

• Contact: Lucky (name not fully specified)
• Email: [email protected]
• Telephone: +27(12)432 1300
• Info Centre: 086 00 65383
• Website: www.nlcsa.org.za
• Address: National Lotteries Commission, P.O Box 1556, Brooklyn Square 0083, Pretoria

Submission address: e-tender portal (https://www.etenders.gov.za/)

Submission method: e-tender portal only (https://www.etenders.gov.za/). Email and physical submissions will NOT be accepted.

• Closing time: 06 November 2026 at 11:00 (Standard South African Time). Late submissions will not be accepted.
• Bid format: PDF, protected from modifications, deletions or additions.
• Financial/pricing information must be in a separate folder from the Technical/Functional Response.
• Submissions must be clearly marked with the bidder's name, tender number (NLC2026-009) and tender title.
• The NLC is not responsible for submission failures due to power cuts, poor network coverage, load shedding, or inability to use the e-tender portal.
• Returnable documents (all must be completed and signed):
• SBD 1 (Invitation to Bid): bidder and contact details, signed as the offer cover page.
• SBD 4 (Declaration of Interest): discloses whether any director or shareholder is employed by the state or connected to anyone at the NLC; failure to declare honestly leads to disqualification.
• SBD 9 (Certificate of Independent Bid Determination): certifies the price was set independently, with no collusion.
• Pricing schedule (Annexure A): priced offer.
• Proof of CSD registration (CSD registration report).
• B-BBEE certificate or affidavit (consolidated certificate/affidavit for a JV).
• Signed JV agreement (if applicable).
• Valid FSCA FSP licence (Category II) or proof of bank registration.
• Proof of insurance: Fidelity, Professional Indemnity, Cyber Security, Directors and Officers Liability.
• Company resolution proving the signatory's authority.
• Bids must be submitted in English.
• No services may be rendered before an official NLC Purchase Order is received.

Staged evaluation: Stage 1 Tender Closing and Opening; Stage 2 Administrative Compliance; Stage 3 Mandatory Compliance; Stage 4 Technical Evaluation; Stage 5 Due Diligence; Stage 6 Contract and Award.

• Stage 2 (Administrative): all returnable documents completed and returned, bid signed by authorised person, priced offer included, CSD registration, B-BBEE certificate/affidavit.
• Stage 3 (Mandatory): JV agreement (if applicable), SBD 4, FSCA Category II FSP licence or bank registration, proof of insurance (Fidelity, Professional Indemnity, Cyber, Directors & Officers). Failure to comply leads to disqualification.
• Stage 4 (Technical): rating scale 0–5. Categories and weightings:
• Company Experience: 30% (Liquidity Portfolio Experience 10%, Key Personnel 10%, Organizational Capacity 10%)
• Financial Stability & Regulatory Compliance: 25% (Financial Stability Indicators 15%, Regulatory Compliance 10%)
• Investment Proposal: 30% (Investment Approach & Methodology 15%, Liquidity Management and Access to Funds 15%)
• Proposed Return (Yield) Evaluation: 15% (Net Yield Over 3-Month ZARONIA 10%, Stress-Tested Return ±200bps 5%)
• Minimum qualifying score: 70% (70/100). Only bidders scoring at least 70 proceed to pricing and specific goals.
• Pricing and specific goals: 80/20 preference point system. Price points: 80; specific goals points: 20; total: 100.
• Specific goals points (evidence required: CSD report, B-BBEE certificate/affidavit, or doctor's letter where applicable):
• Black owned: 100% = 8 points; 51%–99% = 4 points; less than 51% = 0 points.
• Black women owned: 100% = 4 points; 30%–99% = 2 points; less than 30% = 0 points.
• Black youth owned: 100% = 4 points; 30%–99% = 2 points; less than 30% = 0 points.
• Owners with disability: 20% or more = 4 points; more than 10% but less than 20% = 2 points; less than 10% = 0 points.
• Failure to submit required evidence for specific goals scores zero for those points.
• Stage 5: NLC may conduct due diligence (site visits, additional information) before award or during contract.
• Stage 6: negotiation and best and final offers may be requested.

The NLC requires the appointment of a service provider (Financial Services Provider or locally registered Bank) to invest approximately R5.3 billion in surplus funds for a period of five years.

• Investment objectives: capital preservation, liquidity to meet operational requirements (approximately R250 million monthly), and yield enhancement within prudent risk management.
• The investment mandate prioritises capital preservation and liquidity over yield.
• The NLC may appoint multiple service providers and may reallocate funds between them.
• No single counterparty may be allocated more than 25% of total invested funds unless approved by the Accounting Authority.
• Permissible instruments: short-term deposits (call, money market), fixed-term deposits (NCDs, fixed deposits), government instruments (Treasury bills, RSA bonds), collective investments (money market or fixed-income funds with daily liquidity and capital preservation objectives).
• Prohibited instruments: derivatives, structured products, credit-linked notes, capital-guaranteed equity-linked notes, equities, offshore instruments, any instrument exposing the NLC to potential capital loss.
• Counterparty credit ratings: minimum long-term BBB- (S&P/Fitch) or Baa3 (Moody's); minimum short-term A-3 (S&P), F3 (Fitch) or P-3 (Moody's). Long-term ratings must be investment grade.
• Funds must be ring-fenced and segregated in the name of the NLC.
• Bidders must notify the NLC immediately of any regulatory action, downgrade, capital adequacy deterioration, or liquidity stress event.
• Bidders must disclose their Business Continuity Plan and Cybersecurity Framework.
• Deliverables: market research reports, implementation of investment strategy, regular performance updates, project inception/progress/close-out reports, monthly risk management reports.
• Contract duration: 5 years, effective from appointment date, SLA signing, or as directed by the NLC.

The bidder must disclose their Business Continuity Plan and Cybersecurity Framework. The bidder should demonstrate the establishment and adequacy of Professional Indemnity insurance cover, Directors and Officers Liability insurance cover, Cyber security insurance cover, and Fidelity Insurance cover.

Pricing must be quoted in South African Rand (ZAR), inclusive of all fees, charges and costs payable by the NLC, including VAT where applicable.

• Pricing basis: hypothetical portfolio of R1,000,000,000; evaluation period 12 months; average portfolio balance R1,000,000,000.
• The R250 million operational liquidity requirement is not included in the pricing hypothesis.
• No performance fee unless specifically disclosed.
• All fees, charges, commissions, spreads and other costs must be disclosed.
• Pricing schedule (Annexure A) includes separate sections for asset managers and banks, covering management fees, custody fees, transaction costs, settlement costs, underlying fund fees, performance fees, reporting fees, early withdrawal costs, and other charges.
• Bidders must confirm that the prices represent all costs and that no additional fees will be imposed without NLC's written approval.
• Financial stability evaluation requires audited financial statements for the last three years, statement of AUM (asset managers) or total assets/AUC/AUA (banks), and cash ratio.
• Regulatory compliance evaluation requires latest Capital Adequacy Return (asset managers) or Basel III disclosures showing CAR and LCR (banks).

CSD registration: mandatory. Bidders must be registered on the Central Supplier Database (www.csd.gov.za) and provide their CSD registration number and report. The NLC may not award business to unregistered bidders. Only foreign suppliers with no local registered entity are exempt.

• Tax compliance: bidders must ensure their tax matters are compliant.
• B-BBEE: a valid B-BBEE certificate or affidavit (in terms of the codes of good practice) must be submitted. Consolidated certificate/affidavit required for a JV.
• FSCA: asset managers must hold a valid Category II FSP licence authorising discretionary investment management services. Banks must provide proof of registration under the Banks Act.
• Insurance: proof of valid Fidelity, Professional Indemnity, Cyber Security, and Directors and Officers Liability insurance cover.
• COIDA: bidders warrant that all employees (including subcontractors) are covered under the Compensation for Occupational Injuries and Diseases Act; proof of registration and good standing may be requested.
• POPIA: bidders must consent to processing of personal information for procurement purposes (SCM Consent Request Form).
• Bids must be submitted in English.
• Bidders must not make any news releases concerning the RFP without NLC consent.
• Collusion with other bidders leads to automatic disqualification and restriction from doing business with organs of state.