CREDIT RISK

Basel II regulatory capital guidelines have spurred the development of credit scoring and probability of default modeling among banks around the world. Their objectives are to establish credit risk control processes that increase the sensitivity of banking reserves to credit risk, and to enhance risk management systems and processes.

The InforSense Credit Risk solution enables banks to build a risk data infrastructure to store and collect data, check data quality, create and validate risk models, apply the models to risk based assets, and generate standard reports for regulatory authorities. The solution includes technology, methodology, and training consultation services to bank customers. InforSense also works with worldwide risk solution provider partners to deliver comprehensive credit risk Basel II solutions to customers.

Benefits include:

• Integration of data from different operational resources to collect all of the required data that underpins the credit risk scoring
• Quality control procedures to ensure the validity of the data for further processing
• Construction and validation of risk models
• Scoring processes to calculate the IRB metrics
  • Probability of Default (PD)
  • Exposure at Default (EAD)
  • Loss Given Default (LGD)
  • Expected Losses (EL)
• Reporting of Risk-Weighted Assets at multiple levels of a financial organization to provide scorecards and dashboards to Senior Management and operational risk controllers

InforSense offers a user-friendly workflow-based model development environment and a set of predefined workflow templates to guide credit risk model creation, tuning and validation processes. The platform supports flexible data manipulation, data statistics, data mining and reporting functions, and the credit analytic applications developed within InforSense can be easily shared, reviewed and used by credit analysts and officers. The credit rating system can also be embedded in other application systems at commercial banks.

In addition, InforSense provides a metadata dictionary to help customers starting data collection planning, or to map the existing data warehouse to credit risk data inventory. With InforSense, banks can keep tabs on what data is needed, where to collect it, and how to maintain it, in accordance with Basel II guidelines.