Related papers: Identification of Credit Risk Based on Cluster Ana…

A major challenge in consumer credit risk portfolio management is to classify households according to their risk profile. In order to build such risk profiles it is necessary to employ an approach that analyses data systematically in order…

In this paper, we investigate the credit risk in the loan portfolio of banks following different business models. We develop a data-driven methodology for identifying the business models of the 365 largest European banks that is suitable…

The data mining technique of time series clustering is well established in many fields. However, as an unsupervised learning method, it requires making choices that are nontrivially influenced by the nature of the data involved. The aim of…

Credit risk assessment is a crucial aspect of financial decision-making, enabling institutions to predict the likelihood of default and make informed lending decisions. Two prominent methodologies in credit risk modeling are logistic…

Credit risk scorecards are logistic regression models, fitted to large and complex data sets, employed by the financial industry to model the probability of default of a potential customer. In order to ensure that a scorecard remains a…

As it is known in the finance risk and macroeconomics literature, risk-sharing in large portfolios may increase the probability of creation of default clusters and of systemic risk. We review recent developments on mathematical and…

For more than a half-century, credit risk management has used credit scoring models in each of its well-defined stages to manage credit risk. Application scoring is used to decide whether to grant a credit or not, while behavioral scoring…

Credit scoring is a rapidly expanding analytical technique used by banks and other financial institutions. Academic studies on credit scoring provide a range of classification techniques used to differentiate between good and bad borrowers.…

We consider the problem of the statistical uncertainty of the correlation matrix in the optimization of a financial portfolio. We show that the use of clustering algorithms can improve the reliability of the portfolio in terms of the ratio…

The rise of digital payments has accelerated the need for intelligent and scalable systems to detect fraud. This research presents an end-to-end, feature-rich machine learning framework for detecting credit card transaction anomalies and…

Machine learning plays an essential role in preventing financial losses in the banking industry. Perhaps the most pertinent prediction task that can result in billions of dollars in losses each year is the assessment of credit risk (i.e.,…

With the increase of credit card usage, the volume of credit card misuse also has significantly increased. As a result, financial organizations are working hard on developing and deploying credit card fraud detection methods, in order to…

Financial inclusion ensures that individuals have access to financial products and services that meet their needs. As a key contributing factor to economic growth and investment opportunity, financial inclusion increases consumer spending…

This paper introduces a credit risk rating model for credit risk assessment in quantitative finance, aiming to categorize borrowers based on their behavioral data. The model is trained on data from Experian, a widely recognized credit…

In this article we propose a novel measure of systemic risk in the context of financial networks. To this aim, we provide a definition of systemic risk which is based on the structure, developed at different levels, of clustered neighbours…

Machine learning has opened up new tools for financial fraud detection. Using a sample of annotated transactions, a machine learning classification algorithm learns to detect frauds. With growing credit card transaction volumes and rising…

Measuring graph clustering quality remains an open problem. To address it, we introduce quality measures based on comparisons of intra- and inter-cluster densities, an accompanying statistical test of the significance of their differences…

Insider threats represent one of the most critical challenges in modern cybersecurity. These threats arise from individuals within an organization who misuse their legitimate access to harm the organization's assets, data, or operations.…

Cluster analysis is a popular unsupervised learning tool used in many disciplines to identify heterogeneous sub-populations within a sample. However, validating cluster analysis results and determining the number of clusters in a data set…

The use of credit cards has recently increased, creating an essential need for credit card assessment methods to minimize potential risks. This study investigates the utilization of machine learning (ML) models for credit card default…