Capital One

1
Capital Ones Statistical Problems

• Our top ten list
• August, 2006

Bill Kahn Chief Scoring Officer bill.kahn_at_capitalo
ne.com
2
Overview

• What Capital One Does
• How We Do It
• What We Need

3
What Capital One Does
Diversified consumer finance

• Geography
• US
• Canada
• UK
• Spain
• Italy

• Lifestage
• Acquisition
• Underwriting
• Account management
• Collections

• Products
• Card
• Auto
• Medical
• Home
• IL
• SB
• Banking

4
How We Do It Quantitative Continuous
LearningQCL
5
What We Need (Statistically speaking)
10 Rejection Inference 9 Valuation 8
Complex models 7. Adverse Action 6
Database design 5. Advanced curve fitting
4 Loss Function Optimization 3 DOE 2
Secure data sharing 1 Great people
6
Summary

• Capital loans money
• To individuals who competitors misprice
• And we could make good use of more advanced
  statistical technology
• 10 Rejection Inference
• 9 Valuation
• 8 Complex models
• 7 Adverse Action
• 6 Database design
• 5 Advanced curve fitting
• 4 Loss function optimization
• 3 DOE
• 2 Secure data sharing
• 1 Great people

7
QA