SAS® helps CIMB Bank grow with less risk

CIMB Group is Malaysia’s second-largest financial services provider and one of Southeast Asia’s leading universal banking groups, with a presence in nine countries. CIMB Bank, the commercial banking arm of CIMB Group, has a network of 366 branches and over 2,100 self-service terminals nationwide. The result of a merger between Bumiputra-Commerce Bank and Southern Bank in 2006, CIMB Bank offers conventional and Islamic consumer banking, wealth management, insurance and unit trust products.

With expeditious growth came the need to upgrade its credit risk scorecards capability. CIMB Bank appointed SAS to enhance its internal risk scorecard development capability for a quicker rollout of new credit risk scorecards. During the initial stages of the merger, the bank needed to integrate all the customer data in a standardized format. Existing credit scorecards were to be recalibrated to better measure and rank credit to help fuel business growth. The scorecard modeling process also had to be simplified to allow experts, such as business analysts, to do reports without requesting help from the IT department. The bank wanted scorecard modelers to have more time to focus on creating models that help it grow and stay profitable.

In the initial stage, CIMB Bank successfully used SAS Credit Scoring for both credit application scorecard development and the retail loan market. The bank wanted to take its analytical ability further by developing behavior scorecards and establishing an enterprisewide risk data mart that gathers customer data in one location.

The first successful step was incorporating all data into the enterprisewide risk data mart. The move enabled risk analysts to retrieve a composite view of a customer’s details that included demographic information, account activities and collection data from all the applications across the bank via a single SAS platform. Analysts no longer need to search different databases to pull together information.

“Data standardization allows consistent interpretation by business analysts,’’ says Lian Kim Khoo, Head of Basel II Implementation at CIMB Group. The single repository not only supports risk management analysis, but it also helps the bank migrate to the internal-ratings-based (IRB) approach for full compliance with Basel II.

CIMB Bank is particularly pleased with the flexibility it is able to gain from using SAS in-house rather than outsourcing its risk scorecard development.

“The SAS solution helps CIMB boost our internal scorecard risk development capability. This is crucial as our internal team understands the business better and can build scorecards that are reflective of our business compared to an external vendor,” Khoo says.

Using SAS technology has enabled CIMB Bank to develop its scorecards within a shorter time frame. “By selecting SAS, we have helped to train and retain top risk specialists because SAS provides a better platform to hone and optimize analytics skills,” added Khoo.

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