Retail lending risk related scenario generation

Data processing: financial – business practice – management – or co – Automated electrical financial or business practice or... – Finance

Reexamination Certificate

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C705S035000, C705S038000, C705S037000

Reexamination Certificate

active

07469227

ABSTRACT:
Generation of risk-related retail lending portfolio scenarios is disclosed. A selected functional form is used to decompose vintage performance data into a maturation component, an exogenous component and vintage calibration parameters for the portfolio. Known exogenous drivers are extracted from the exogenous component to create a residual exogenous component. Monthly changes in the residual exogenous component are computed, and the distribution of monthly changes in the residual exogenous component is measured. This information is used to generate a number of random potential future scenarios for the residual exogenous component and, ultimately, for the generation of a number of forecasts for key portfolio drivers.

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