ICICI Bank implements Fair Isaac's retail credit risk analytics
27 June 2006 | 2402 views | 0
Source: Fair Isaac
Fair Isaac Corporation (NYSE:FIC), the leading provider of analytics and decision management technology, announced today that Mumbai, India-based ICICI Bank has become the first financial institution in Asia to implement Fair Isaac's Strategy Science to enhance business performance in its retail credit portfolio.
Strategy Science is Fair Isaac's proprietary methodology for determining optimal decision strategies by using advanced analysis capabilities. India's second-largest bank and largest retail credit provider will apply Strategy Science for Acquisitions to take a more precise, data-guided approach to its origination strategy design, enabling the lender to substantially grow its retail credit portfolio while keeping losses under control at target levels.
"ICICI Bank is truly breaking new ground by becoming the first financial services provider in Asia to implement Fair Isaac's market-proven strategy optimization methodology," said Chisoo Lyons, vice president of Analytics at Fair Isaac. "Strategy Science will play a key role in giving the bank a sustainable competitive edge, meeting the rapidly growing consumer demand for credit and helping shape the future of how customer decisions are made throughout India and other emerging markets in Asia."
By expanding the application of analytics beyond predictions to making optimal decisions under a complex set of constraints, Strategy Science will help ICICI Bank quickly design, test and refine individual account strategies. With Strategy Science, strategic options are clearly and concisely defined and openly identified. As a result, ICICI's portfolio managers can fully understand how their choice of a particular strategy will play out against the business objective they seek to optimize. For example, the bank will be able to hold losses from non-performing assets to well below average industry levels. By using Strategy Science, ICICI Bank can experiment with any number of "what if" scenarios before settling on precisely the right strategy to meet its growth objectives.
"Making smarter decisions for each new and existing customer are among the most significant challenges we face as we rapidly expand our retail credit portfolio," said Madhivanan Balakrishnan, General Manager, Retail Assets Product Group at ICICI Bank. "That is why we turned again to Fair Isaac for its industry-leading analytics and decision management solutions. Strategy Science allows us to be substantially more informed and precise when it comes to developing more profitable decision strategies that both match our needs for growth of our business while reducing our exposure to risk."
India, as the world's second most populous nation and Asia's third largest economy, continues to be one of the fastest-growing credit markets in the world. The country's credit card market has been growing at more than 30 percent annually. The middle class in India has been estimated at between 150 and 200 million households, fueling a boom in consumer credit.
Fair Isaac has been working with ICICI Bank since 2000 to help implement best practice credit and risk management techniques. The bank currently deploys Fair Isaac custom application scorecards and TRIAD adaptive control system to manage risk in its credit card portfolio.