The AI platform enabled CIMB to develop machine learning credit models for its retail portfolio, which strengthened the Bank’s credit risk modelling and retail underwriting capabilities across unsecured loan products. This led to improved quality of loan screening, resulting in reduction of credit loss.
The fully automated AI platform leveraged CIMB’s wealth of traditional and alternative data to develop machine learning credit models for the bank’s retail portfolio. With the sharper models, the bank is able to reduce credit loss by improving the default probability estimation for retail loan applications.
The collaboration commenced work in mid-2020 to structure the use case and connect historical and real-time data. AI models were subsequently built based on these use cases and data, with the solution deployed into production by end-2020. Within six months of the AI platform going live, CIMB observed multiple benefits, including lower expected losses and higher returns against capital in its retail loans segment.
The newly developed AI models were rigorously tested and validated before being utilised in production for decision-making. These models were also compared to traditional models across a set of three loan products, where the new AI models demonstrated significantly improved accuracy.
Vera Handajani, Group Chief Risk Officer, CIMB Group said, “Our new credit risk platform, driven by innovative use of AI, has reduced the cost of processing loan applications and is expected to reduce our credit loss by improved default probability estimation for retail loans. Within six months, we were already able to see tangible results and savings from this AI-driven approach, building on our momentum as we scale digital transformation across the organisation. This is in line with our focus on digitising for value under our Forward23+ strategic plan.
Simon Brender, Regional Vice President Asia, DataRobot said, “As competition between regional, global financial institutions and fintech intensifies across the region, AI is becoming critical for financial services institutions operating in the region to stay ahead of the competition. CIMB is leading the way in harnessing the power of AI to reduce risk, and we are proud the noteworthy results of our collaboration have been recognised by this prestigious award from The Asset.”
The Asset Triple A Digital Awards recognise financial institutions and technology firms that have excelled in innovation and have developed a unique digital experience for customers across the Asia-Pacific and the Middle East. The Asset Triple A Awards have been built upon a stringent methodology and a rigorous approach to selecting the winners. The awards are adjudicated by The Asset’s board of editors, who collectively have several decades’ worth of experience evaluating industry awards in the Asia-Pacific and the Middle East.
DataRobot AI Cloud is the next generation of AI. DataRobot’s AI Cloud vision is to bring together all data types, all users, and all environments to deliver critical business insights for every organization. DataRobot is trusted by global customers across industries and verticals, including a third of the Fortune 50. For more information, visit http://www.datarobot.com/.
CIMB is one of ASEAN’s leading banking groups and Malaysia’s second largest financial services provider, by assets. Listed on Bursa Malaysia via CIMB Group Holdings Berhad, it had a market capitalisation of approximately RM55.3 billion as at 31 December 2021. It offers consumer banking, commercial banking, wholesale banking, transaction banking, Islamic banking and asset management products and services. Headquartered in Kuala Lumpur, the Group is present in all 10 ASEAN nations (Malaysia, Indonesia, Singapore, Thailand, Cambodia, Brunei, Vietnam, Myanmar, Laos and Philippines). Beyond ASEAN, the Group has market presence in China, Hong Kong, India, South Korea, the US and UK.
CIMB has one of the most extensive retail branch networks in ASEAN with 630 branches and around 33,000 employees as at 31 December 2021. CIMB’s investment banking arm is one of the largest Asia Pacific-based investment banks, which together with its award-winning treasury & markets and corporate banking units comprise the Group’s leading wholesale banking franchise. CIMB is also the 92.5% shareholder of Bank CIMB Niaga in Indonesia, and 94.8% shareholder of CIMB Thai in Thailand.
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