The New Lending System - Putting common sense into compliance and risk assessment

SAS has been conducting research on analytic frameworks that combine expert judgment with best science. We have observed that effective integration of comprehensive views, especially customer-centric ones, with financial performance and the evolving economic and market realities, offers significant competitive advantages.

SAS has actually pioneered a new lending system that, compared with today’s typical loan underwriting systems, is:

1) simpler, yet more accurate,
2) thorough, yet concise,
3) becomes more, not less, predictive over time, and
4) is statistical in nature, yet is transparent and passes various tests of reason by simple inspection.

Moreover, these advances in loan underwriting approaches have the implications for the entire lending value chain.

CCAF (pronounced See-Caf) is short for Comprehensive Credit Assessment Framework. It is a new lending system that affords many benefits, in addition to those stated above, when compared with more traditional loan underwriting systems. Additional benefits include:

ease of understanding
stresses loan affordability
adaptibility and ease of updating
ability to be effectively monitored
is based on proven lending principles
provides adequate controls to limit risk
affords early warning in advance of performance declines

For those who want to learn more, just click on the links in this post to download a copy of the CCAF white paper or to obtain a copy of our book that describes the new lending system. Please share your comments on either, or on this or past blog content. I want to hear your opinions!