Credit Risk Management

Credit risk management system

IMPLEMENTATION OF A CREDIT RISK MANAGEMENT SYSTEM

We help banks and financial institutions identify, measure, control and reduce credit risk and maintain financial stability by implementing comprehensive credit risk management solutions

Why implement a credit risk
management system

  • Crises in the global economy and constant changes in market conditions push risk management requirements higher every year. The National Bank pays close attention to new risk assessment methods and is adopting global banking supervision practices: SREP, AQR, stress testing and expert judgement.

    Banks and financial institutions therefore need new technology solutions that identify, assess, mitigate and monitor risks automatically and ensure compliance with regulatory requirements.
  • Comprehensive solutions for managing the risk of an individual borrower, the risk of the loan portfolio and operational risk keep the balance between risk and results, ensure compliance with the law and preserve the stability and resilience of the organization.

The Prime Source risk management system

Prime Source implements comprehensive risk management solutions based on its own developments. We offer an end-to-end approach, from designing the risk management methodology to implementing automated solutions.

In our work we rely not only on IT infrastructure but also on our own experience: real cases and models proven in practice across more than 30 projects.

Our team members bring experience and knowledge gained over many years at major financial institutions — Forte Bank, ATF Bank, Eurasian Bank and Nadra Bank (Ukraine).

  • 11 11 successful implementations at second-tier banks and at government and quasi-government organizations
  • 10 Every one of our risk management specialists has more than 10 years of experience
  • 4 Experience automating 4 models: KPMG, Ernst and Young and Deloitte under IFRS 9 and the requirements of the National Bank of Kazakhstan
  • 100 Our clients have cut the time spent calculating provisions by a factor of 100

  • Risk management for the individual borrower

    • Credit process • Credit offer formats • Risk opinion formats • Rating and scoring systems • Limit control • Monitoring process

  • Loan portfolio risk management

    • Reporting formats • Setting and monitoring limits • Monitoring of overdue payments • Loan portfolio stress testing • Borrower watch list process

What the client gains from automation

  • 1 Process optimization

    Less manual work and higher staff productivity thanks to optimized risk monitoring technology

  • 2 Fewer errors

    Lower probability of errors by bank employees

  • 3 Faster decisions

    Faster decision-making and a higher quality customer base

  • 4 Scalability

    Customer risk management across the entire bank

  • 5 Objective service

    Consistent and fair treatment of customers

  • 6 Higher profit

    Higher profitability thanks to well-grounded pricing decisions

  • 7 Lower expenses

    Lower costs thanks to efficient use of human resources

  • 8 Lower share of problem debt

    A smaller share of non-performing debt

  • 9 Applying the credit policy

    Effective application and management of the credit policy

  • 10 Lower operating costs

    Higher efficiency and lower operating costs thanks to optimized processes

  • 11 Faster processes

    Less paperwork and faster processes

  • 12 Fast data collection

    Less time spent collecting information the organization already holds

The Prime Source team helped us build a platform that lets us analyze risks across different parameters and models, so we can make decisions to reduce risk and take preventive action

Why Kazakhstan's top 10 banks
choose Prime Source solutions

  • Products by foreign
    developers
  • Hard to tailor to a specific client
    Off-the-shelf offerings from large companies are harder to customize, configure and adapt to the reality of a particular customer, because they use closed source code and/or are tuned to a specific market
  • Costly implementation
    Solutions from large, well-known international players are usually more expensive and take more time. Additional products and licenses have to be purchased
  • Slow feedback
    Because of the time difference with foreign support teams, a fast answer to a request is not always possible
  • Product by
    Prime Source
  • Easily tailored to any client
    We use a flexible modular architecture so that every customer can choose the implementation option that suits them. We work with open source code
  • Cost-efficient implementation and maintenance
    We use our own developments, so our solutions are more affordable, faster and more effective. No additional modules or licenses are required. Once our system is implemented, you can maintain it yourself
  • Available 24/7
    Our clients receive a response within minutes

Advantages of the risk management system

  • Time and resource savings The system reduces the time and resources spent on risk management thanks to fully automated monitoring and assessment and automated measures to eliminate risk and damage
  • Adaptability and easy configuration The platform complies with international and national regulatory requirements. The solution is configured flexibly and quickly to match internal needs, changing market conditions and legal requirements

PRIME SOURCE CAPABILITIES IN RISK MANAGEMENT

We help manage borrower risk: we organize credit processes, prepare credit offers, configure rating and scoring systems, control limits and run borrower monitoring processes, including the watch list.

Building a credit factory

We implement a solution for automating retail and corporate lending processes quickly and cost-effectively, based on our own developments created together with international experts.

The lending automation system collects credit applications from various channels: the web, points of sale and mobile devices.

The solution verifies the customer's identity and contact details, assesses creditworthiness automatically or manually, prepares and stores documents electronically, transfers funds to the customer or counterparty, and receives and tracks payments. The system supports the customer throughout the entire loan lifecycle.

  • Cost efficiency

    Fast, cost-efficient module-by-module implementation based on our own developments, with no extra payments for licenses and software

  • Efficiency

    Automated data processing cuts application review time several times over

  • Open source code

    The system can be enhanced in-house to handle non-standard tasks

A UNIQUE LOAN LOSS PROVISIONING SYSTEM

We implement our own analytical system that calculates provisions automatically in accordance with IFRS 9. This unique solution, developed by our team, is used by 10 banks in Kazakhstan.

The system performs complex mathematical calculations automatically and offers a wide range of tools for configuring different provisioning methodologies. This makes it possible to assess the impact on capital correctly, save employees' time and ensure compliance with regulatory requirements.

  • Cost efficiency

    Fast, cost-efficient implementation based on our own developments, with no extra payments for licenses and software

  • Efficiency

    Integration with external systems for data upload makes processing the information for provision calculation fast and efficient

  • Flexibility

    The solution supports an unlimited number of calculation methodologies. Classification and provisioning parameters — portfolios, groups and so on — are also easy to change.

IMPLEMENTATION OF A RATING SYSTEM

We implement our own system for assigning ratings based on financial statements and a company's qualitative characteristics. Convenient tools let you configure the parameters and rating models yourself.

The solution supports high-quality customer selection, continuous borrower monitoring and prompt lending decisions.

  • Cost efficiency

    Fast, cost-efficient implementation based on our own developments, with no extra payments for licenses and software

  • Objectivity

    Comprehensive analysis across a wide range of configurable parameters lets the solution assess customers consistently and objectively

  • Flexibility

    The solution allows classification parameters and rating models to be configured to individual needs

IMPLEMENTATION OF SCORING SYSTEMS

We implement our own scoring system built on IBM products, the best in global practice. The solution consists of ready-made modules for configuring and applying risk scoring models specific to a particular organization. IBM SPSS Modeler covers every data operation, from the initial assessment of data quality to obtaining and evaluating scoring results.


  • Reliability

    IBM is one of the world's leading providers of IT solutions. Its products have proven to be the most reliable and effective on the market for intelligent technologies.


  • Cost efficiency

    We are an IBM Platinum Business Partner, which means we offer our clients the best implementation terms and provide highly qualified service.

  • Loan portfolio risk

    We prepare reports and automate their generation, configure the bank's limits, monitor overdue payments, run loan portfolio stress tests and build borrower watch list processes.

PORTFOLIO STRESS TESTING

We help manage, track and apply stress testing scenarios. We develop what-if models to analyze the portfolio's sensitivity to risk and to plan capital. We make the entire stress testing process transparent.

We continuously develop and refine performance models to cover every likely scenario.

  • Cost savings

    Fast implementation and launch of the model based on our own developments within a single, simplified platform

  • Consistent management

    Defining scenarios and feeding modelling results into balance sheets, financial statements and capital plans

  • Continuous updates

    Regular updating and development of performance models and refinement of stress testing scenarios

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