Metcombank accelerated processes of underwriting using the solution of SAS

On December 4, 2014 Metcombank constructed the credit pipeline based on SAS Real-Time Decision Management (SAS RTDM) thanks to what it began to make quicker decisions on credit requests and minimized the probability of operational errors.

Choosing a Solution

The decision on need to create the automated scoring system was made by the management of Metcombank in 2012. By then the bank came to considerable volumes of crediting and issued about i800 one million a month. At the same time for consideration of the credit request 4-5 hours left on average that for express crediting there is a lot of. To develop further, it was necessary or to increase the staff of underwriters, or to automate technology processes. The bank went on the second way.

Project Progress

Process of implementation of the credit pipeline was separated into several stages. First of all, biographical scoring for decrease in social and demographic risks and classification of borrowers was started. Within this task the data mart was developed and 2 models of biographical scoring for car loans are started. The functionality of credit scoring was implemented by product-based SAS Credit Scoring for Banking, SAS RTDM and SAS Model Manager.

At the second stage of system implementation based on credit scoring a number of auxiliary solutions which allow to use systems capabilities of credit scoring more widely is implemented, raising at the same time quality of the made decisions on credit scoring and improving informational content of results, noted in SAS. In general within the second stage of the project the following functionality is implemented: initial check of presence of the client at stop-lists that lowered load of underwriters at decision making in the manual mode; data validation of the client on compliance to requirements of bank (preskoring) — in this block is implemented check of income of the borrower on compliance to the internal reference book of income of individuals and check of cost of the vehicle (for unofficial dealers); integration with 4 external bureau of credit histories (BCH) on sending and obtaining answers on credit history and scoring point of BKI; consolidation of these credit stories (CS) on the client — in addition to consolidation of credit history of the borrower from 2 BKI, in this block is implemented consolidation behavioural scoring points of BKI; identification of the facts of fraud on internal data on a certain bank to rules which confirm a possibility of fraud according to the credit request (antifraud); search of the connected requests of the client and identification of changes in data of the request — this block was necessary for tracking of the connected borrowers and application of rules of an antifraud; determination of strategy of verification on the basis of the carried-out inspections and calculations (considering results of biographical and behavioural scoring, a contribution and the dealer's type, the amount of the repaid obligations to the required credit, a system classifies the borrower and helps to define what inspections the underwriter for acceptance of the final decision should carry out); calculation of additional modular indicators for software Underwriter; integration with the Underwriter system.

Result

After the successful end of these works a system was transferred to trial operation. After transfer of all regional bank departments on the new scheme of underwriting — since February, 2014 — all credit requests undergo processing in SAS RTDM.

In November, 2014 in Metcombank the next stage of development of the credit pipeline based on SAS RTDM was completed. Automatic requests to base of mortgage cars of NBKI are added to a system. In January, 2015 it is going to add requests to the system of counteraction to fraud National Hunter (experimental design bureau).

In SAS companies, average time of consideration of the request in bank it was reduced from 4-5 to 1.5 o'clock. At the same time the quantity of man-hours of underwriters decreased by 30%, and the number of addresses of borrowers grew almost by a third.

Development Plans

In the long term, due to acceleration of decision making and complex assessment of borrowers using a system based on SAS RTDM, Metcombank intends to optimize credit risk management.

"When choosing the supplier of the solution for us the flexibility of a product, a possibility of setup of business rules, ease of integration with external data sources, work with scoring models and popularity of a brand were the defining factors. Taking into account these criteria the majority of votes on tender committee typed the offer of SAS company" — Vitaly Kostyukevich, the head of department of risk control of retail lending of Metcombank told.

"SAS RTDM implementation project in Metcombank began during rapid growth of business of bank. Now, during economic downturn, the solution remains relevant as helps bank to hold the acceptable level of credit risk at decrease in resources consumptions on underwriting. For the last year the quality of borrowers strongly decreased, and for banks it became even more important to consider all risks and opportunities at issuance of credit, to weigh everything pros and cons. At the same time decisions need still to be made quickly not to miss the reliable borrower. To us it is valuable that the solution of SAS was selected as the universal platform which can help bank both with growth maintenance, and with quality management of the loan portfolio" — Valery Pankratov, the CEO of SAS Russia/CIS noted.

"In two months after the beginning of the project a system at us earned in the industrial mode for scoring of borrowers. Then we step by step connected external sources and implemented all other options of check" — Vitaly Kostyukevich explained.

"Now we develop functionality a fraud scoring on the basis of already developed internal regulations" — Vitaly Kostyukevich adds.

Representatives of the company integrator reported TAdviser.