Risk and Regulatory Insights: Reconciling Default Concepts for Risk Management Analytics

Various regulatory, accounting and portfolio management exercises require different credit loss estimates. This has created confusion in the industry over what measures of default to apply and how to produce them, resulting in the proliferation of multiple credit analytic tools within firms. This profoundly affects risk management activities as it has become more difficult to reconcile default estimates and communicate outcomes to decision makers. read more

Risk and Regulatory Insights: The Quest for Integrated Risk Analytics

Financial risk management has witnessed a revolution in advanced analytics over the last 20 years. New analytic techniques combined with quantum leaps in computing power provide risk managers with an array of tools to better measure and manage risks of various types. Integrating analytic capabilities offers great potential for risk managers and their firms; however, it remains an elusive goal for much of the financial industry. read more

Stress Test Case Study: Leveraging JWL for Stress Testing Project for a Medium-Size U.S. Commercial Bank

Regulators had identified weakness in the bank’s risk management processes for analyzing the impact of stress economic scenarios on its consumer risk exposures. The bank needed to accelerate its stress testing capabilities beyond its in house capabilities by leveraging the Javelin Whole Loan (JWL) Platform for analyzing various stress scenario impacts. read more

Loan Loss Reserving Case Study: Large Community Bank Leverages JWL for Loan Loss Reserve Process

A large community bank wanted to migrate away from a roll rate methodology that was subject to more manual error and not easy to run each quarter to a more analytical and efficient approach. The bank did not have much modeling expertise so the enhanced methodology needed to be easily integrated into existing risk management workflow. Five Bridges approached the client about using the Javelin Whole Loan(JWL) analytics platform for its easily adapted and streamlined UI. read more

Stress Testing Case Study: Medium-Sized Commercial Bank Leverages JSP for Its Stress Testing Exercises

A commercial bank lacked the analytic infrastructure to conduct stress tests on its consumer and commercial structured loan securities portfolios. Regulatory reviews had identified weaknesses in the current processes’ ability to directly incorporate multiple user-defined stress and scenario tests into their process. read more

Stress Test Case Study: Stress Testing for a Medium-Size U.S. Commercial Bank

Regulators had identified weakness in the bank’s risk management processes for analyzing the impact of stress economic scenarios on its consumer risk exposures. The bank needed to accelerate its stress testing capabilities beyond its in house capabilities by leveraging the Javelin Whole Loan (JWL) Platform for analyzing various stress scenario impacts. read more

Loan Loss Reserving Case Study: Large Community Bank Leverages Javelin Whole Loan (JWL) Platform for Loan Loss Reserve Process

A large community bank wants to migrate away from a roll rate methodology that was subject to more manual error and not easy to run each quarter to a more analytic approach leveraging JWL for its consumer loan portfolio loan loss reserve and provisioning process. The bank does not have much modeling expertise so the enhanced methodology must be able to be used by existing risk management staff. read more

Model Validation Case Study: Regional Bank Leverages Javelin Whole Loan (JWL) Platform for Model Validation Exercise

A regional bank’s model validation process has come under regulatory scrutiny for lacking an analytic framework for testing their consumer loan models on a consistent basis. The bank determined that it could leverage Five Bridges’ whole loan analytics by using JWL to test their model’s performance over a battery of statistical tests trained on different samples. read more

CECL Impact Analysis Case Study: Understanding the Potential Impacts from CECL Implementation for a Large U.S. Commercial Bank

The bank’s board of directors recently made a request of the risk management team to conduct a side-by-side assessment between the bank’s current reserving methodology and the current exposure credit loss (CECL) methodology the bank will need to implement in the future. The incurred loss approach used at the bank to be GAAP compliant does not incorporate any forward-looking estimates of credit losses as required under the CECL framework, hence the bank was searching for a capability that could be used to compare both reserving approaches against the bank’s loan portfolio. read more