Credit Scorecard Validation

Available from Cypress Software Systems LP

In examination guidance on credit scoring models, OCC Bulletin 97-24 states, “bank management must ensure that credit scoring models are used appropriately.” And to ensure “appropriate” usage, bank management must:
» Understand credit scoring models thoroughly
» Validate or revalidate the credit scoring models’ performance regularly
» Review tracking reports, including the performance of overrides
» Take appropriate action when the credit scoring models’ performance deteriorates
» Ensure credit scoring model compliance with fair lending regulations

But even when you have a scorecard deployed and you’re using it to make decisions – or it’s at least a major factor in your decision-making process – are you assured of being in compliance at your next examination?

At Cypress, we can aid in implementing a strategy that makes compliance a certainty. Perhaps even more importantly, we can help you understand whether your scorecards are performing as you expect.

The Credit Scoring Validation service from Cypress focuses on educating your team on origination scorecard validation concepts, including discussion of approach, tracking, and when to revalidate to ensure regulatory compliance.

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.

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