Models and Scoring

When used properly, credit scoring models are effective risk management tools. National banks can use credit scoring models to:

• Control risk selection,
• Manage credit losses,
• Evaluate new loan programs,
• Improve loan approval processing time,
• Ensure that existing credit criteria are sound and consistently applied,
• Improve compliance with the Equal Credit Opportunity Act and the Fair Housing Act, and
• Improve profitability

Follow the links on this page to regulatory resources related to credit models and scoring.

References

OCC=Bulletin

Credit Scoring Models: Examination Guidance (OCC Bulletin 97-24, May 1997), Guidance
Informs national banks of the OCC's concerns about proper use of credit scoring models

Risk Modeling, Model Validation (OCC 2000-16, May 2000)
Provides guidance for mitigating potential risks arising from reliance on computer-based financial models that are improperly validated or tested