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Andrew Jennings
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To some degree, we're living in a world where we are cursed with our own success. Financial institutions have seen tremendous benefits from analytics, and as a result, they are using predictive models on an increasingly broader scale, to measure capital reserve requirements and manage complex customer decisions. But as... Continue reading
Posted 3 days ago at Banking Analytics Blog
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I’ve been blogging about customer centricity success stories, and today, I’ll share the fourth FICO case study in my series, a client which I’ll call Bank D. This global leader in credit cards wanted to demonstrate its commitment to protecting customer information and assets from fraud, and its use of... Continue reading
Posted Jul 31, 2014 at Banking Analytics Blog
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Recently on the blog, I shared stories of two FICO clients (Bank A and Bank B) that are successfully overcoming challenges to advance customer centricity goals. Today I’ll share the story of a third client, which I'll refer to as Bank C. Bank C, like many others in its markets,... Continue reading
Posted Jul 24, 2014 at Banking Analytics Blog
There is a lot of media interest in our latest quarterly survey of North American bank risk officers! In this short video clip, TheStreet recaps our survey results and talks about a possible real estate bubble. Our survey found lenders in both the U.S. and Canada are concerned that home... Continue reading
Posted Jul 11, 2014 at Banking Analytics Blog
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The latest installment of our quarterly survey of risk managers at U.S. and Canadian banks shows real concern about a possible re-inflation of the real estate bubble. In the survey, 56% of respondents directly involved in mortgage lending expressed moderate to heavy concern that “an unsustainable real estate bubble is... Continue reading
Posted Jul 8, 2014 at Banking Analytics Blog
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I’ve been blogging about FICO clients that are succeeding in their journeys toward customer centricity. Today I’ll share the story of the second client, which I'll refer to as Bank B. Having attained the #2 market share position in a maturing growth market, the bank needed a way to keep... Continue reading
Posted Jun 30, 2014 at Banking Analytics Blog
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In my last post, I mentioned four FICO clients that have taken significant steps toward their customer centricity goals. Doing right by customers—not only in terms of conduct but in more sensible and tailored allocation of products and limits, and better communication—is leading to improvements in such key performance indicators... Continue reading
Posted Jun 18, 2014 at Banking Analytics Blog
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There’s a good deal of consensus around the idea that retail banks need to become more customer-centric. It’s a key topic with nearly every company I’ve met with and nearly every industry forum I’ve attended over the past few years. Publications by Gartner, McKinsey & Company, Ernst & Young, PricewaterhouseCoopers,... Continue reading
Posted Jun 10, 2014 at Banking Analytics Blog
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As I continue digging through the results of our most recent quarterly survey of North American bank risk officers, I keep coming back to one clear and seemingly troubling trend – our survey respondents think consumer loan delinquencies are going to rise. Is that a good thing or a bad... Continue reading
Posted May 12, 2014 at Banking Analytics Blog
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Cars, diamonds, gold, stock, art, baseball cards – which collateral holds most sway with bankers when it comes to approving a consumer loan? We included this somewhat unusual question in the latest installment of our quarterly survey of North American risk managers. We asked bank risk officers which type of... Continue reading
Posted Apr 16, 2014 at Banking Analytics Blog
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For the first time in a long time, I sense a bit of pessimism creeping into our quarterly North American risk survey results. In the latest survey of U.S. and Canadian bank risk professionals, expectations for delinquencies on credit cards and auto loans, as well as total delinquencies on all... Continue reading
Posted Apr 8, 2014 at Banking Analytics Blog
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I'm just back from participating in a Chicago roundtable discussion on “Attracting and Developing Talent in Data and Analytics.” The event was run by the Executive Club of Chicago, and brought together 150 CIO/CMO level attendees across a broad spectrum of industry and academic institutions. I joined panelists Tom O'Toole... Continue reading
Posted Mar 19, 2014 at Banking Analytics Blog
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As FICO's chief analytics officer, I regularly meet with our banking clients all over the world. Rarely have I seen as stark a difference in regional risk management priorities as I see today when I compare banks in Europe and North America to banks in developing countries throughout Asia. Europe... Continue reading
Posted Mar 10, 2014 at Banking Analytics Blog
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There is a saying in Bali: the cure for anything is saltwater—sweat, tears or the sea. This analogy seemed fitting at our recent APAC CRO forum, as I discussed key issues with Asia’s leading chief risk officers at a resort that overlooked the inviting Java Sea. At a panel discussion... Continue reading
Posted Feb 4, 2014 at Banking Analytics Blog
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In my last post, I discussed how our latest quarterly North American risk survey indicates consumer re-leveraging is picking up. That same survey also found that small business lending appears to be on a healthy trajectory. In our survey of bank risk officers in the U.S. and Canada, 67% of... Continue reading
Posted Jan 24, 2014 at Banking Analytics Blog
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Our latest quarterly survey of bank risk officers in North America always seems to offer a few interesting nuggets. Two results in this quarter’s survey that caught my attention were: Expectations for delinquencies on auto loans hitting their highest level since Q4 2012; 34% of respondents expected delinquencies on auto... Continue reading
Posted Jan 14, 2014 at Banking Analytics Blog
It’s been quite a year in banking analytics – regulatory challenges, growth opportunities, new fraud threats, and the surge of mobile as the hot channel for customer engagement. I expect 2014 to bring even more change. Based on my conversations with clients over the past few weeks, I’ve put together... Continue reading
Posted Dec 23, 2013 at Banking Analytics Blog
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If you’re a banker, that’s what your colleagues think. Our latest quarterly survey of US and Canadian bank risk professionals finds that they expect consumers to spend more and borrow more over the next six months. Our survey results are always fascinating to me because the consensus thinking of bankers... Continue reading
Posted Oct 9, 2013 at Banking Analytics Blog
With the 2013 INFORMS Annual Meeting now in full swing, I’d like to congratulate my colleague Gerald Fahner for being named a semifinalist for the INFORMS Innovation Award. His submission—titled “Imposing Domain Expertise on Algorithmic Learning to Construct Highly Predictive and Palatable Scorecards”—discusses an exciting new analytic approach that balances... Continue reading
Posted Oct 7, 2013 at Banking Analytics Blog
The race to deploy Big Data analytics – in banking and elsewhere – is creating a talent gap for qualified data scientists. Gartner estimates Big Data will generate six million U.S. jobs over the next three years (CNNMoney). However, McKinsey & Company predicts there won’t be enough qualified people to... Continue reading
Posted Jul 26, 2013 at Banking Analytics Blog
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To operate in a customer-centric manner, businesses must be able to respond to customer actions as they take place. In many situations, data analysis and data-driven decisioning must occur in real time or near real time, based at least partly on the stream of data coming in from mobile phones,... Continue reading
Posted Jul 12, 2013 at Banking Analytics Blog
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We just wrapped up our latest quarterly survey of U.S. bank risk professionals. As a first in our survey’s three-year history, respondents are expecting something of an equilibrium in the consumer “credit gap” – 60% expect the amount of credit requested by consumers and the amount of credit extended by... Continue reading
Posted Jul 9, 2013 at Banking Analytics Blog
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The promise of Big Data looms large as banking institutions worldwide launch major customer centricity initiatives. Today we have the means to capture and analyze much bigger quantities of data than ever before, and to make meaningful connections between different types of it. We can analyze data in-stream for real-time... Continue reading
Posted Jun 13, 2013 at Banking Analytics Blog
Since the global recession, regulators worldwide have become increasingly concerned about the soundness of decision making and capital adequacy within financial services. As a result, they are taking an even closer look at how financial institutions manage risk and use scoring models. To address this greater regulatory scrutiny of model... Continue reading
Posted May 23, 2013 at Banking Analytics Blog
Financial institutions have had a difficult time adapting to the latest regulatory guidance regarding model validation and management. But making the right improvements can also translate into better analytic performance and risk management. To both comply and compete, it's critical to build an organizational policy for comprehensive model and credit... Continue reading
Posted May 16, 2013 at Banking Analytics Blog