War Leaves an Enduring Legacy in Combatants’ Lives

The memory of combat experience endures in World War II veterans. As veterans age, traumatic memory that previously may have been suppressed in the busyness of family and everyday life can re-emerge. Combat stress may affect not only the veterans, but also those people closely associated with them. Interviews were conducted with World War II veteran aircrew, wives, children, grandchildren, siblings, and friends to examine the impact of combat experience on the veterans and the family across the life course from the perspectives of the various participants. The combat experience significantly affected the life course of most.     

A Discrete Variable Chain Graph for Applicants for Credit

A bank offering unsecured personal loans may be interested in several related outcome variables, including defaulting on the repayments, early repayment or failing to take up an offered loan. Current predictive models used by banks typically consider such variables individually. However, the fact that they are related to each other, and to many interrelated potential predictor variables, suggests that graphical models may provide an attractive alternative solution. We developed such a model for a data set of 15 variables measured on a set of 14 000 applications for unsecured personal loans. The resulting global model of behaviour enabled us to identify several previously unsuspected relationships of considerable interest to the bank. For example, we discovered important but obscure relationships between taking out insurance, prior delinquency with a credit card and delinquency with the loan.     

Defining attributes for scorecard construction in credit scoring

In many domains, simple forms of classification rules are needed because of requirements such as ease of use. A particularly simple form splits each variable into just a few categories, assigns weights to the categories, sums the weights for a new object to be classified, and produces a classification by comparing the score with a threshold. Such instruments are often called scorecards. We describe a way to find the best partition of each variable using a simulated annealing strategy. We present theoretical and empirical comparisons of two such additive models, one based on weights of evidence and another based on logistic regression.     

A rich opportunity

Certain sectors are well known for employing large numbers of statisticians, points out David Hand. These include the pharmaceutical sector, medical research and government. Less well known, however, is that the personal . Financial services sector also requires large numbers of numerate people, and that statisticians, with their understanding of risk and uncertainty and their ability to extract information from large quantities of data, are in particular demand.     

On Loss Distributions from Installment-Repaid Loans

The banks have been accumulating huge data bases for many years and are increasingly turning to statistics to provide insight into customer behaviour, among other things. Credit risk is an important issue and certain stochastic models have been developed in recent years to describe and predict loan default. Two of the major models currently used in the industry are considered here, and various ways of extending their application to the case where a loan is repaid in installments are explored. The aspect of interest is the probability distribution of the total loss due to repayment default at some time. Thus, the loss distribution is determined by the distribution of times to default, here regarded as a discrete-time survival distribution. In particular, the probabilities of large losses are to be assessed for insurance purposes.