Altair Monarch Exercise 11 - Credit Risk Model Data Prep

Baba_Majekodunmi_703
Baba_Majekodunmi_703
Altair Employee
edited September 2023 in Altair RapidMiner

Exercise Files

You can download all Monarch exercise files here: Monarch Sample Files for Exercises

  • Credit Background.pdf
  • Credit Delinquency.pdf
  • Credit Reference.accdb
  • Credit Values.xlsx

 

Exercise Overview

You are a Credit Analyst and you need to prepare data that will be useful for developing a Credit Risk Model, used to manage lending risk in a financial institution. Using the Data Prep Studio You'll need to prepare data by acquiring it from a variety of data sources (pdf, Access, Excel) that consist of customer demographics, account balance information, and additional reference information. Fortunately, there is a unique identifier across the files so you should be able to join the data with ease.

Once the data is combined and prepared, you will export the data and share it with your colleagues in the Modeling team that will use a Statistical Modeling tool of choice (like Altair Knowledge Studio) to develop the Credit Risk Model.

Before sharing the final prepared data you decide to answer the following questions that you believe will provide helpful insights for your colleagues who will be developing the credit risk model:

Step 1: Combine data from multiple files to build the credit risk file.

Step 2: Answer the following questions/perform the following tasks:

  1. What is the average Initial Score for the pool of applicants?
  2. What is the average Recommended Line for the pool of applicants?
  3. Create a Summary of Initial Score, and Recommended Line, by Loan Officer (Agent ID)
  4. Create a Calculated Field called "Avg Balance Segment" by Segmenting 'Avg Monthly Balance' into 4 Segments;
    1. Less than or Equal to 0
    2. 0-100
    3. 101-500
    4. 501-1,000
    5. 1,000+
  5. Create a Summary by the newly created "Avg Balance Segment" by Count of Records, Sum of Avg Monthly Balance, Sum of Profit, and Sum of Amount Lost.

 

Exercise Answer

Not sure you got the correct answer? No problem. Watch the video below for a demonstration of this exercise from start to finish.


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