Consumer Credit Models
Manage exposures to underlying credit and economic cycles, effectively reducing exposure to risk, addressing regulatory requirements, and improving economic return.
Moody's Analytics enables you to identify and understand the most predictive drivers of your consumer lending portfolio, allowing you to manage risk and opportunities confidently. Our Solutions account for origination and vintage quality, lifecycle component and prevailing economic conditions. They are fully documented, back-tested and leverage state-of-the-art modeling and analytical expertise from our experienced analysts.
Expert Consumer Credit Modeling Solutions
Portfolio Analyzer Solution: Robust impairment solution for forecasting probabilities of default (PD), loss given default (LGD), and prepayments for all retail credit lending portfolios. Learn More.
- Estimate PDs, LGDs and prepayments under stressed scenarios.
- Assess future credit loss, capital estimates, and VaR contribution.
- Analyze loans and future originations, vintages and credit scores.
- Devise pricing and screening borrowers' risk levels at origination.
- Detect deterioration early with robust monitoring features.
Moody's CreditCycle™ Solution: Ready-made cohort models built from 100% of monthly Equifax consumer credit file, enabling your team to quickly assess the performance of your portfolio relative to industry trends.
- Use volume and performance by line of business, geography, vintage, and credit score.
- Easily implement and benchmark portfolios at lower operational costs.
- Use as a benchmark or challenger model.
- Quickly test the severity of custom scenarios on portfolio performance.
- Fully documented, transparent and back-tested methodology.
Moody's CreditCycle™ Custom Solution: Custom-built cohort or loan-level models tailored to your unique business, exposures, and footprint, enabling your team to leverage Moody’s Analytics consultative services to the fullest extent.
- Expert model building, support, and accurate interpretation of results.
- Models adjusted to your data realities: loan-level, aggregate or hybrid.
- Analyze the effects of lifecycle component, origination condition, and economic events.
- Use as a champion or challenger model, for loss mitigation, planning, and stress testing.
- Evaluate how different conditions impact performance using alternative scenarios.
- Fully documented, transparent and back-tested methodology.
Applications
- Profit and loss forecasting
- Scenario and simulation analysis
- Regulatory stress-testing
- Sensitivity analysis
- Benchmarking
- Investing
- Strategic planning
Key Features
- Coverage of all consumer lending product lines.
- Integrated macro and regional economic data.
- Monthly updated forecasts and scenarios.
- Expanded regulatory scenarios (CCAR, PRA etc.)
- Fully documented and transparent methodology.
- Detailed model validation documents.
- Flexible and secure data entry/updating and exporting.
- Easily integrated with portfolio management tools.
- User-friendly web-based interface.
- Access to economists and risk practitioners.
- In person events and timely webinars.
