Are you in compliance?

If you rely on scorecard(s) to help make credit decisions, according to OCC Bulletin 97-24, you must also:

• Understand credit scoring models thoroughly; 

• Validate or re-validate the credit scoring models’ performance regularly;
   
• Review tracking reports, including the performance of overrides; 

• Take appropriate action when the models’ performance deteriorates; and, 

• Satisfy all fair lending regulations.

At Cypress, we not only aid in implementing a strategy that helps ensure compliance, we can also help you understand whether your scorecards are delivering the benefits you expect.

Our Credit Scoring Validation service focuses on educating your team on origination scorecard validation concepts, including discussion of approach, tracking, and when to re-validate to ensure regulatory compliance. It also includes training on how to track scorecard performance and note shifts in your customer population that could indicate a reduction in scorecard effectiveness.

Once we understand your goals, our conclusions may include a change to your existing score cut-off, or a recommendation to procure a more robust model or models from one of our analytics partners.

With a more robust model, you’ll have:

• The confidence to make more automated decisions 

• Higher approval rates and lower corresponding loan losses 

• The ability to grow your origination shop without adding costly staff

• Improved loan reserve predictability

As a result, your institution will benefit from a more marketable portfolio.