This paper provides an overview of the 2014 validation for the VantageScore 3.0 model and details model performance on consumer credit data from the June 2011-June 2013 time period. It demonstrates that the VantageScore 3.0 model remains highly accurate, consistent, and stable across all major credit categories, and when examined geographically.
In 2011, in response to the banking industry’s increasing reliance on modeling and analytics to drive decision-making, the Office of the Comptroller of the Currency (OCC) expanded long-standing guidelines titled “Supervisory Guidance on Model Risk Management.” The guidelines provide an invaluable road map that allows lenders to develop a robust model validation philosophy and function within their institution. To assist lenders in this effort and to provide model transparency, VantageScore Solutions annually conducts validations on all of its models and releases the results publicly. (See also: 2014 validations for the VantageScore 1.0 and VantageScore 2.0 models.)