A Suitable Strategy in Allocating Financial Resources to Customer in Banking Industry

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Motedayen, Mohammad Mahdi | 2010

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Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 40671 (01)
University: Sharif University of Technology
Department: Industrial Engineering
Advisor(s): Mahlooji, Hashem
Abstract:
Nowadays, credit risk is recognized as the most significant factor of bankruptcy in banking industry. Incorrect selection and unsuitable appropriation of financial resources to customers cause this risk. On the other hand, the detection of company operating and financial difficulties is a subject which has been fundamentally discussed in financial ratio analysis. As a result, this study tries to analyze existence and relationship between financial ratios of recipients and their reimbursement ability by evaluation of their conditions in awarding them credit. Furthermore, according to the credit risk context, some of financial ratios are selected and their values are obtained as the input variables. Then, by applying logit regression and decision tree, two models are presented to evaluate customers for awarding credit.
Keywords:
Decision Making Tree ; Banking ; Credit Risk ; Logit Model ; Regression Analysis ; Customer Relationship Management

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