Author: Li-May Chew

Best Practices
April, 2011  -  Doc # FIN227279
Number of Pages: 22
Number of Figures: 8

This IDC Financial Insights report examines Taiwan's Taishin International Bank's (Taishin's) "analytics-based profit-driven" strategy to reach optimal retail banking decisions through solid data analysis, predictive models, and optimization tools. A distinctive feature of this profit-driven strategy is its ability to balance the marketing- and risk-driven approach to pursue optimal profit by looking into both the risk and the revenue dimensions.

This report discusses Taishin's business need to embrace advanced predictive technologies and its management's implementation challenges and successes. Li-May Chew, CFA and associate research director, IDC Financial Insights Asia/Pacific Financial Advisory Service, comments, "The aftermath of the global upheaval resulted in financial institutions striving to implement a better way to pursue revenue expansion without compromising on their risk management strategies."

"Realizing that neither a revenue-driven nor a risk-driven approach were optimal, Taishin found a middle ground to manage its retail business by embracing an analytics-based profit-driven approach. Evidence of the benefits from developing a suite of state-of-the-art predictive models and integrating the risk with marketing dimensions to pursue optimal profit has been apparent, with the bank registering one of the lowest nonperforming loans in Taiwan of 0.33% even while coverage ratios improved to one of the highest."

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