Experian (Costa Mesa, Calif). and New York-based Moody's Analytics, a subsidiary of Moody's Corp. , announced a strategic alliance that will bring financial institutions products for managing consumer loan portfolios. As the first effort out of this alliance, Experian and Moody's Analytics are announcing Moody's CreditCycle Plus, which is designed to enhance strategic and tactical planning by providing advanced loss-forecasting and stress-testing capabilities.
According to Gary Kearns, president of Experian Decision Analytics, "By bringing Experian's credit risk modeling and analytics expertise, consumer credit insights and extensive data assets together with Moody's Analytics' consumer credit forecasting and macro and regional economic expertise, we can offer sophisticated loss-forecasting and stress-testing tools. These tools can help organizations respond to and manage market volatility, address high-risk segments within an existing portfolio and maximize strategic growth through advanced asset class selection," he said in a press release.
Moody's CreditCycle Plus will allow financial institutions to access Experian's consumer loan data and integrate it with Moody's Analytics' macroeconomic data to analyze the future performance of their own portfolio under a variety of economic scenarios. Moody's CreditCycle Plus adds Experian's proprietary benchmarking service and data, providing financial institutions with forecasting and insight into the lending practices of their peers.
"The tough economic environment has highlighted the need for financial institutions to systematically assess and quantify how their lending decisions, as well as economic conditions, will impact bottom-line performance," said Paul Getman, executive director of Moody's Analytics, in a press release. "Accurate assessment of the probability of default, and its associated losses, is critical to the effective allocation of risk, assessment of liquidity and capital requirements, identification of hidden risks in the portfolio and strategic planning for future growth. The combined power of Experian and Moody's Analytics will allow us to deliver robust products which address this market need."