Fair lending compliance : intelligence and implications for credit risk management

FAIR LENDING COMPLIANCE......Page 6
0470167769......Page 1
CONTENTS......Page 8
FOREWORD......Page 12
PREFACE......Page 16
ORGANIZATION OF TOPICS......Page 18
WHO CAN BENEFIT FROM THIS BOOK......Page 19
ACKNOWLEDGMENTS......Page 20
CHAPTER 1: CREIDT ACCESS AND CREDIT RISK......Page 24
ENTERPRISE RISK MANAGEMENT......Page 25
LAWS AND REGULATIONS......Page 27
CHANGING MARKETS......Page 29
PREPARE FOR THE CHALLENGES......Page 31
RETURN ON COMPLIANCE......Page 37
Appendix 1A......Page 40
Appendix 1B......Page 41
ROLE OF DATA IN FAIR LENDING COMPLIANCE INTELLIGENCE......Page 46
SAMPLING......Page 52
TYPES OF STATISTICAL ANALYSIS......Page 58
COMPLIANCE SELF-TESTING STRATEGY MATRIX......Page 59
CREDIT RISK MANAGEMENT SELF-TESTING STRATEGY MATRIX......Page 61
MATCHING APPROPRIATE STATISTICAL METHODS TO REGULATORY EXAMINATION FACTORS......Page 65
CASE FOR A SYSTEMATIC APPROACH......Page 66
SUMMARY......Page 67
Appendix 2A......Page 69
UNIVERSAL PERFORMANCE INDICATOR......Page 74
DEFINE DISPARITY......Page 76
DERIVE INDICES......Page 81
GENERATE UNIVERSAL PERFORMANCE INDICATOR......Page 88
PERFORMANCE MONITORING......Page 98
SUMMARY......Page 103
Appendix 3A......Page 106
CHAPTER 4: LOAN PRICING ANALYSIS......Page 108
UNDERSTANDING LOAN PRICING MODELS......Page 110
SYSTEMATIC PRICING ANALYSIS PROCESS......Page 114
OVERAGE/UNDERAGE ANALYSIS......Page 135
OVERAGE/UNDERAGE MONITORING OVERVIEW......Page 146
SUMMARY......Page 148
Appendix 4A......Page 149
Appendix 4B......Page 156
Appendix 4C......Page 160
Appendix 4D......Page 162
Appendix 4E......Page 165
CHAPTER 5: REGRESSION ANALYSIS FOR COMPIANCE TESTING......Page 170
TRADITIONAL MAIN-EFFECTS REGRESSION MODEL APPROACH......Page 171
DYNAMIC CONDITIONAL PROCESS......Page 174
DCP MODELING FRAMEWORK......Page 177
DCP APPLICATION: A SIMULATION......Page 191
SUMMARY......Page 203
Appendix 5A......Page 204
CHAPTER 6: ALTERNATIVE CREDIT RISK MODELS......Page 206
CREDIT UNDERWRITING AND PRICING......Page 207
OVERVIEW OF CREDIT RISK MODELS......Page 208
HYBRID SYSTEM CONSTRUCTION......Page 224
HYBRID SYSTEM MAINTENANCE......Page 239
HYBRID UNDERWRITING MODELS WITH TRADITIONAL CREDIT INFORMATION......Page 245
HYBRID UNDERWRITING MODELS WITH NONTRADITIONAL CREDIT INFORMATION......Page 257
HYBRID MODELS AND OVERRIDE ANALYSIS......Page 260
SUMMARY......Page 271
Appendix 6A......Page 273
Appendix 6B......Page 277
Appendix 6C......Page 278
Appendix 6D......Page 288
SEGMENTATION SCHEMES SUPPORTING INTEGRATED VIEWS......Page 290
PROPOSED SEGMENTATION APPROACH......Page 292
APPLICATIONS......Page 298
SUMMARY......Page 320
Appendix 7A......Page 321
Appendix 7B......Page 324
MODEL VALIDATION FOR RISK AND COMPLIANCE INTELLIGENCE......Page 328
TYPICAL MODEL VALIDATION PROCESS, METHODS, METRICS, AND COMPONENTS......Page 330
AN INTEGRATED MODEL VALIDATION APPROACH......Page 340
CLOSING OBSERVATIONS......Page 367
INDEX......Page 370