FILE PHOTO: Skyscrapers in The City of London financial district are seen at sunrise in London, Britain, September 14, 2020. REUTERS/Hannah McKay/File Photo
The once-in-a-lifetime mix of economic shutdowns, unprecedented government support and an uncertain path to recovery have upended old risk models, based on historical data, necessitating a more dynamic, forward-looking way of analysing lending risk. The searches involve pouring over anonymised data and are a way of surveying overall risk rather than individual customer habits.
“This time there is economic volatility beyond what we have ever seen, there is unprecedented government support, and to try and model it all with 100% accuracy is impossible,” said Matt Waymark, director of finance at NatWest Group. “We’ve seen very little so far in terms of actual defaults, whereas the models would’ve predicted a big hit following the recent economic dip, so the question is whether government support schemes are merely delaying the problem or actually mitigating it,” Waymark said.
Lawrence
Lawrence Banks will need the best minds in financial alchemy if their 'profits' are not to dwindle.
Lawrence off topic, Bank and Monument looks more like Tokyo , not London!
Lawrence 💰 ⚽️
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