Dubai Islamic Bank to implement Moody's Analytics' credit risk scoring tool

This partnership emphasizes Moody's Analytics' leadership in the Middle East as the pre-eminent provider of credit risk management systems to financial institutions. Dubai Islamic Bank's decision supports its strategy to strengthen its credit risk assessment processes and equip its credit risk teams with "best-of-breed" solutions.

Dubai Islamic Bank decided on Moody's Analytics after an exhaustive evaluation of various solution providers.

"We assessed the vendors not only in terms of their technical skills and solution technology, but also their relevant experience, knowledge of the industry and Basel II related practices. We used a leading Consulting firm to help us prepare a comprehensive evaluation process as part of our Basel II gap analysis," explains Syed Munawar, Head of Credit Policy & Portfolio Risk Management at Dubai Islamic Bank.

Moody's RiskAnalyst is a robust, enterprise-wide credit risk management system that collects, analyzes and stores financial and non-financial information - providing a complete solution for managing and analyzing risk for firms of all sizes. RiskAnalyst's "open" architecture allows for quick and seamless integration with other applications and data.

RiskAnalyst is powered by a centralized database that brings together the inputs required for an internal rating system. These inputs can be used to enable model development and evaluation.

Dubai Islamic Bank will use RiskAnalyst to assess the bank's credit relationships with its clients in order to facilitate the credit underwriting process and consistently monitor the status of their portfolio. The tool will be used for all institutions in the Corporate, Contracting, SME and Commercial Real Estate sectors. The solution also includes the development of an internal rating model for unrated financial institutions.

"A reliable risk rating methodology will not only build confidence in the credit initation process, but also provide greater speed, accuracy and consistency across our enterprise," adds Syed Munawar.

"It is essential for the Bank to acquire this tool now in the context of achieving Basel II compliance under the IRB approach in 2011 as it will allow us to present a statistically validated model with adequate data within the regulator's timeline," says Fahad Bin Fahad, CRO at Dubai Islamic Bank.

"Moody's Analytics is very pleased to enter into this agreement with Dubai Islamic Bank as it underscores our commitment to serving the Middle East. We already provide risk management solutions to most key players in the market, and Dubai Islamic Bank is an important addition,"

says Wael Jadallah, Director at Moody's Analytics' office at the DIFC.