#USA #Woburn #Empyrean Solutions #Model IQ #Behavioral Modeling

Empyrean Solutions Launches Model IQ™: A New Era in Behavioral Modeling for Financial Institutions

In a significant development for financial institutions, Empyrean Solutions has officially launched its latest product, Model IQ™. This innovative behavioral modeling solution aims to revolutionize how banks and credit unions analyze customer behavior to predict defensible cash flows. Historically, forecasting cash flows has relied heavily on data from one-time studies or opaque methodologies, often leading to inaccuracies and inefficiencies. Model IQ is set to change this narrative by providing a transparent and institution-specific approach.

The primary feature that differentiates Model IQ is its ability to utilize a bank's own historical data to generate insights into customer behavior. As Chris Maclin, CEO of Empyrean Solutions, succinctly stated, "Behavior, not balances, drives risk." This statement underscores the fundamental principle that understanding customer behavior is critical in managing financial risks effectively. With Model IQ, finance and risk teams are better equipped to adapt to shifting market conditions, armed with models that are not only easy to understand but also defendable to stakeholders such as boards and auditors.

How Model IQ Works

Model IQ introduces several sophisticated features designed to streamline the modeling process and enhance the accuracy of predictions. The solution replaces traditional models with dynamic behavioral assumptions that can evolve over time, integrating seamlessly into the financial and risk planning platforms already in use by institutions.

Core Components of Model IQ

Model IQ consists of three essential modules:

1. Deposit IQ: This module focuses on empirical modeling of both non-maturity and term deposit behaviors. It examines factors such as betas, decay rates, and stability, alongside conducting unique analyses to differentiate between genuine growth in funding and internal balance shifts.

2. Loan IQ: This component allows for in-depth modeling of loan prepayments at the instrument level. Users can customize segmentation and choose from various methodologies for robust forecasting, stress testing, and scenario analysis.

3. Credit IQ: The final module aids institutions in modeling credit loss and recovery assumptions. Institutions can utilize peer data or their specific historical data to support various methodologies like net charge-off rates and point-in-time loss forecasts.

These modules are designed to work in tandem, creating a cohesive structure that empowers institutions to respond to market changes rapidly. By utilizing Model IQ, financial organizations can significantly reduce the time taken to adapt their models from months to mere hours, while retaining full governance and ownership of their assumptions.

An Empowering Tool for Financial Institutions

What sets Model IQ apart is its user-friendliness and the complete transparency it offers to financial institutions. The guided workflows, automated calibration, and built-in documentation provide a centralized library of models, with clear audit trails. This robust framework allows users to replace manual data exports and reconciliation processes, paving the way for operational efficiency.

Empyrean Solutions is particularly focused on meeting the needs of community and regional financial institutions, which often require tailored solutions that adhere to their unique operational frameworks. By providing tools that facilitate a deep understanding of customer behavior, Model IQ empowers financial teams to make more informed decisions.

A Bright Future for Behavioral Analysis

As financial institutions continue to navigate complexities in risk management, strategic planning, and profitability, Model IQ serves as a beacon of innovation. It exemplifies Empyrean Solutions’ commitment to enhancing financial confidence and operational success among its clients, which range in size from under $500 million to over $200 billion in assets. The future of financial management is here, and with it, comes the promise of more accurate predictions and enhanced strategic planning capabilities.

For those interested in learning more about Model IQ or scheduling a demonstration, information is readily available at Empyrean Solutions’ website. This revolutionary tool is set to redefine how financial institutions approach risk and performance management, ensuring they remain at the forefront of the industry.

About Empyrean Solutions

Founded by industry veterans with significant experience, Empyrean Solutions stands out as a leader in the provision of financial risk and performance management software. Their cloud-based technology facilitates robust financial navigation, enabling institutions of all sizes to serve their communities effectively and with confidence.