More consumers nearing perfect FICO® Scores, but are scores improving?

My colleagues in FICO Labs monitor FICO® Scores and how they move over time. In our most recent review, we continue to see the effects of consumers’ scores moving up AND down. At the high end of the score distribution, the number of consumers in the 800-850 range is at...

Twin Themes for Bank Strategies in 2012

 In a new article in Global Banking and Finance Review titled “European Credit: More Trouble Ahead,” FICO’s managing director for EMEA, Mike Gordon, discusses our most recent European Credit Risk Outlook. This report by FICO and Efma has been discussed in this blog by my colleague Daniel Melo, but...

Big Data Changes the Analytics Paradigm

Big Data is a hot topic today that stems back to the early days of high-performance computing and parallel computing, which I worked on during my time in theoretical physics at Duke and Los Alamos. These days, Big Data tools facilitate the ease in applying these concepts. Interestingly, much of...

Mobile Opens the Door for Better Fraud Detection

Mobile banking services will become increasingly important to consumers, as more and more adopt smartphones and use them to stay in touch with their personal financial pictures. My colleague Paul Swyny recently blogged about the growing opportunity to leverage mobile communications in banking. In particular, we're finding the mobile channel...

FICO® Scores and inquiries—the facts

There always seems to be a lot of interest in how the FICO® Score is impacted when a consumer applies for credit. In truth, these credit inquiries account for a relatively small percent of the score (less than 10%, in fact). Because of ongoing interest, let’s walk through some interesting...

European Credit Risk Report Signals Recession (CNBC Video)

On CNBC Squawk Box Europe, EMEA Managing Director Mike Gordon discusses FICO's latest European credit risk survey. The survey shows that nearly eight out of ten European risk managers believe Europe will plunge back into recession this year. If you're unable to view the CNBC video above, view it here.

The Profitability Paradox

In the middle of a recession — or what seems like one — you get what I call the profitability paradox. Simply put, banks don’t want to lend to customers who want credit, even though these tend to be the most profitable customers. How does this work? If a customer...

Innovations in collections analytics

At a recent collections and recovery webinar that I co-presented, I polled attendees to find out what area they felt could be improved to drive the biggest C&R gains. An overwhelming 50% said it was technology. Process also emerged as a key theme, coming in second at 18.2%. These results...

Colombian banking: potential and peculiarities

Cards International recently published a country survey of Colombia and its potential for banking growth. They note that banks are profitable there and have low levels of non-performing loans. The banking industry appears to be poised for expansion in a market where only 57.6% of the 45 million people have...

Strategic Defaults Not Going Away Anytime Soon

I’ve been blogging about results from our latest quarterly survey of US bank risk officers – specifically how they expect loan delinquencies to drop and credit availability to expand. Today, I’ll focus on survey results from the housing sector. Notably, nearly 2/3 of respondents think strategic defaults will be as...

European Credit Delinquencies Will Rise Further

The need for small business credit is making headlines in many European countries, with politicians often railing against banks for “withholding” credit. Anyone wondering why banks are being conservative with their lending should review the latest European Credit Risk Outlook released by FICO and Efma. According to more than 100...

Bankers getting ready to loosen the purse strings

In my last post, I discussed the optimism of US bankers regarding loan delinquencies in our latest quarterly risk survey. On another positive note, survey respondents also indicated that access to credit was likely to improve. When asked about credit availability over the next six months, the majority of respondents...

The Buzz on Customer Centricity

My recent conversations with banking professionals in Asia Pacific has made one thing very clear: customer-centricity is all the buzz nearly in every conversation. Every bank is trying their best to attract customers by putting their best foot forward. Despite gloomy news on the economic horizon, particularly in Europe, the...

Optimism grows among US lenders

Are US bankers embracing the economic recovery? According to our latest quarterly survey of 200+ US risk officers, it certainly looks that way. This sentiment is in sharp contrast to the grim forecast expressed in our recent survey of European risk managers. The US survey showed that risk managers expect...

More bad news for Europe’s small businesses seeking credit

Small business lending has been a focus for most European nations, looking to increase economic growth and cut unemployment. The going hasn’t been easy, and it’s not going to get easier. Results of FICO and Efma’s latest European Credit Risk Outlook, which surveyed more than 100 credit risk management professionals...