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6. August 2014

FICO Releases FICO Score Economic Calibration Service 2 to Improve Loss Forecasting and Capital Allocation Decisions

6. August 2014

Lenders can make better capital allocation decisions under different economic conditions by understanding the resulting impact on consumer credit risk

SAN JOSE, Calif.—August 6, 2014—To help lenders predict future consumer risk under a variety of economic scenarios, FICO (NYSE:FICO), a leading predictive analytics and decision management software company, today announced the release of FICO® Score Economic Calibration Service 2. This service forecasts how credit risk levels at each FICO Score range would change under different economic scenarios, and can help financial institutions stress-test their credit portfolios with loss forecasting models while coordinating capital allocation. The FICO Score Economic Calibration Service combines FICO’s patented methodology with Moody’s Analytics’ expanded and regionalized forecasts of economic data under the Federal Reserve’s Comprehensive Capital Analysis and Review (CCAR) and Dodd-Frank Act Stress Test (DFAST) scenarios and Corelogic’s Home Price Index (HPI).

The Economic Calibration Service 2 provides a forward-looking estimate of consumer repayment risk across the full range of the FICO® Score, based on multiple economic scenarios. By using the service, lenders can understand how repayment risk for consumers would change under varied economic conditions. The newest release of the service captures the most recent consumer credit behavior following the economic downturn by leveraging credit data through April 2014.

"The FICO Score Economic Calibration Service supports a bank's strategic capital planning decisions and can be implemented at both a portfolio level and individual account level," said Jim Wehmann, executive vice president, Scores at FICO. "This service can help lenders easily and confidently comply with CCAR/DFAST reporting requirements."

The Economic Calibration Service incorporates Moody's Analytics projections for more than 1.800 economic variables at the national and regional level, including labor market trends, interest rates, GDP, consumer leverage and house price indexes. FICO derives an empirical relationship between the default rates observed at different score ranges and historical changes in economic conditions, to project an expected probability of default ratio under those economic conditions.

"We are excited to work with FICO to help financial institutions link macroeconomic scenarios directly to credit risk," says Cris deRitis, senior director at Moody's Analytics. "By using our advanced scenario forecasting techniques and extensive macro database, we were able to expand the Fed's scenarios and provide banks with a complete set of economic scenarios. The regional data leveraged by FICO can help banks to more accurately model and forecast potential losses from future changes in the economy."

For more information on ECS go to http://www.fico.com/en/products/fico-score-economic-calibration-service/ and for Moody’s Analytics forecast scenarios visit www.economy.com/ccar.

Über FICO
FICO (NYSE: FICO) ist ein führender Anbieter von Predictive Analytics und Softwarelösungen für Entscheidungsmanagement, das Unternehmen in über 90 Ländern dabei unterstützt, bessere Entscheidungen zu treffen, um Wachstum, Profitabilität und Kundenzufriedenheit zu steigern. Der zukunftsweisende Einsatz von Big Data und mathematischen Algorithmen zur Erstellung von Prognosen zum Kundenverhalten hat ganze Branchen grundlegend gewandelt. Die Analytics-Softwarelösungen und -Tools von FICO werden in den verschiedensten Branchen verwendet, um Risiken und Betrugsfälle zu verringern, profitablere Kundenbeziehungen aufzubauen, Abläufe zu optimieren und strenge regulatorische Vorgaben zu erfüllen. Many of our products reach industry-wide adoption. These include the FICO® Score, the standard measure of consumer credit risk in the United States. FICO-Lösungen integrieren Open-Source-Standards und Cloud Computing, um so maximale Flexibilität und schnelle Bereitstellung zu ermöglichen und Kosten zu reduzieren. Das Unternehmen hilft Millionen von Menschen dabei, ihren persönlichen Kreditstatus zu verwalten. FICO: Make every decision count™. Learn more at www.fico.com.

For FICO news and media resources, visit www.fico.com/news.

FICO and “Make every decision count” are trademarks or registered trademarks of Fair Isaac Corporation in the United States and in other countries.

Newsroom-Kontakte

Greg Jawski
Amerika

greg.jawski@porternovelli.com
+1 212-601-8248

Darcy Sullivan
Europa, Naher Osten und Afrika

dsullivan@fico.com
+44 (0) 209-940-8719

Saxon Shirley
Asien-Pazifik

saxonshirley@fico.com
+65 6422-7795

Marisa Arribas
Lateinamerika

marisaarribas@fico.com
+1 786 482 7231

Camila Placa
Brasilien

camilaplaca@fico.com
+55 11 5189-8258