Moody's CreditCycle™



Manage exposures to underlying credit and economic cycles, effectively reducing exposure to risk, addressing regulatory requirements, and improving economic return.

Moody's CreditCycle™ Suite enables you to identify and understand the most predictive drivers of risk, whether internal or external. You can test how different scenarios, such as your lending standards, business strategy, or economic events affect your retail portfolio. 

Our consumer credit models account for origination and vintage quality, lifecycle component and prevailing economic conditions. They are fully documented and back-tested, and leverage state-of-the-art modeling and analytical expertise from nearly 80 economists.


Moody’s CreditCycle™ Suite

Moody’s CreditCycle Suite encompasses three solutions tailored meet your unique requirements and portfolio characteristics. Each solution facilitates insight into primary drivers of portfolio performance, allowing you to manage risk and opportunities confidently at lower operational costs.

1. Moody’s CreditCycle™ Solution for Custom Models
Custom-built cohort or loan-level models tailored to your unique business, exposures, and footprint, enabling your team to leverage Moody’s Analytics consultative services to the fullest extent.

  • Expert model building, support, and accurate interpretation of results.
  • Models adjusted to your data realities: loan-level, aggregate or hybrid.
  • Analyze the effects of lifecycle component, origination condition, and economic events.
  • Use as a champion or challenger model, for loss mitigation, planning, and stress testing.
  • Evaluate how different conditions impact performance using alternative scenarios.
  • Fully documented, transparent and back-tested methodology.

2. Moody’s CreditCycle™ Solution for Automated Modeling
Calibrated cohort or loan-level models backed by our robust modeling engine, enabling your team to modify, segment, forecast losses, and stress test portfolios with the push of a button.

  • Quickly build models and forecast using automated variable selection procedures.
  • Forecast various measures using econometrically meaningful segmentation.
  • Leverage Moody’s CreditCycle visualization and delivery tools.
  • Use as a challenger model, for strategic planning, scenario and credit policy analysis.
  • Evaluate how different conditions impact performance using alternative scenarios.
  • Fully documented, transparent and back-tested methodology.

3. Moody’s CreditCycle™ Solution for Benchmarking
Ready-made cohort models built from 100% of monthly Equifax consumer credit file, enabling your team to quickly benchmark the sensitivity of your portfolio to industry trends and conduct regulatory dry-runs.

  • Estimate your losses within relative range to the Fed’s results.
  • Use volume and performance by line of business, geography, vintage, and credit score.
  • Easily implement and benchmark portfolios at lower operational costs.
  • Use as a benchmark or challenger model.
  • Quickly test the severity of custom scenarios on portfolio performance.
  • Fully documented, transparent and back-tested methodology.

Key Features

  • Integrated Economic Data: Leverage up-to-date data and monthly updated forecasts that reflect the latest economic conditions.
  • Consistent Set of Scenarios: Incorporate monthly updated scenarios (standard, regulatory or idiosyncratic) for 50+ countries including the U.S. and all its state and metropolitan areas.
  • Trusted Expertise: Leverage more than 20 years of economic and consumer credit forecasting and modeling expertise.
  • Transparent Methodology: Access model validation documents to fully understand the underlying assumptions and for better interaction with regulators.

Who Benefits From the Moody's CreditCycle™ Suite?

Retail lenders can make extensive use of Moody's CreditCycle™ service both within individual retail units and at their corporate levels. Typical users include loss-forecasting teams, consumer loan portfolio managers, credit officers, risk managers, regulatory and compliance officers, collection departments and ABS and RMBS investors.

Applications

  • Profit & loss forecasting
  • Scenario & simulation analysis
  • Regulatory stress-testing
  • Sensitivity analysis
  • Benchmarking
  • Investing
  • Strategic planning

Solution Highlights

  • User-friendly web-based interface, with multiple ways to visualize data.
  • Flexible and secure data entry, updating and exporting environment.
  • Easily integrated with portfolio management tools.
  • Access to our experienced economists and risk practitioners.
  • In person events and timely webinars.