The scope of this study is to investigate the capability of AI methods to accurately detect and predict credit risks based on retail borrowers' features. The comparison of logistic regression, decision tree, and random forest showed that machine learning methods are able to predict credit defaults of individuals more accurately than the logit model. Furthermore, it was demonstrated how random forest and decision tree models were more sensitive in detecting default borrowers.
| ISBN: | 9783658401795 |
| Publication date: | 8th December 2022 |
| Author: | Bohdan Popovych |
| Publisher: | Springer Gabler an imprint of Springer-Verlag Berlin and Heidelberg GmbH & Co. KG |
| Format: | Paperback |
| Pagination: | 83 pages |
| Series: | BestMasters |
| Genres: |
Finance and the finance industry |