Absa Bank, one of Africa`s largest financial services institutions, has selected PIC Solutions to perform a vintage analysis of its mortgage loan accounts.
Vintage analysis is a reporting technique which compares the cumulative delinquency rates of accounts opened in different periods at the same billing period. This analysis is used to detect trends, analyse the risk levels of the bank and compare the rate of delinquency for different mortgage loan accounts. The outcome of the vintage analysis will determine what changes need to be made to the initial application acceptance policy.
This type of analysis is undertaken to provide a view of the lifecycle effect, the new account effect and the portfolio effect. The lifecycle effect shows the cumulative delinquency rate for groups of accounts and is used to determine if risk has increased or decreased. The new account effect compares the delinquency between groups of loans in the first or second months after initial take-on. The portfolio effect investigates conditions that may have affected delinquency across the entire portfolio such as economic changes or collections practices.
Gavin Muller, Head of Credit Risk Intelligence at Absa Bank, states: "Vintage analysis is an excellent tool to discover trends in our mortgage loan accounts. By observing the impact of interest rates, economic changes and our collections practices, we can adjust our credit policies to ensure that we offer our clients the best possible service. We are excited about the outcome of this analysis, as it affects our new account policies and will also ensure that Absa maintains its position as a market leader."
David Lewis, Director of Consulting at PIC Solutions, adds: "We are delighted that Absa Bank has chosen PIC Solutions to provide a vintage analysis of their mortgage loan accounts. This analysis is important as it ensures that Absa can maximise the benefits of its financial services marketing strategies."
Share
PIC Solutions provides customer management solutions to a wide range of blue-chip organisations. We are experts in the fields of credit, risk and marketing and have an established track record of success powered by solutions.
Our ongoing commitment is to enable clients to optimise the credit lifecycle of your business.
Editorial contacts