Approach
Our approach is to strike the balance between good model governance and business value add.
To achieve this our typical approach is as follows:
Discovery
- Understand your requirements, including regulatory, audit remediations, business pressures and business aspirations
- Understand your governance framework and how the models need to be approved (what is the model approval process)
- What data will be available for modelling
Design and specification
- Outline and get approval for the proposed approach. This often includes a discussion of alternate methods, including their relative strengths and weaknesses to enable managers to better apply judgement in model selection
- Once an approach has been agreed, specify the calculations, deliverables and project plan.
- If required, we can also assist with model monitoring solutions, including visualisations.
Build
- We typically profile the data first to ensure that it is suitable for modelling and reconciles to source systems
- We then build the models and playback interim progress to your management team to obtain buy-in as we progress
- Once built, the models are presented with appropriate validations to management for approval
- If required, additional sensitivities are run, and the model is refined
- Finally, the models are documented, and training is provided to your internal team to ensure that they can run the model in future
Validation
- As part of the build process, we will prepare pre-agreed model validations such as statistical goodness-of-fit measures and backtesting
- If you have a second-line model validation function, then we are happy by mutual agreement to assist with the validation process including answering questions as they arise
- We are also happy to assist with audit and regulatory support
With our expertise, you can identify and manage credit risks more effectively, enabling you to achieve your business goals while maintaining a strong credit portfolio.
Contact us today to learn more about how we can help you achieve success.
Contact Us