Talk:Probability of default

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Major changes required to page[edit]

I personally do not like this page at all. After a brief definition, it goes on to say how PD is calculated - even in my brief experience of two years, I have seen at least six to seven ways of estimating PD in retail banking alone. Over the next few days, I will be modifying this page to follow the rough format below -

1. Definition 2. What is TTC and PIT PD? In detail with examples. 3. Some popular methods mentioned in the literature which have been used to estimate PD.

I am not sure of the utility of the last section - Expected Default Frequency - and am going to remove it, and can probably link to it somewhere.

Let me know if any of you object.

Anindya m 1982 (talk) 06:00, 5 January 2012 (UTC)[reply]

FICO scores not a PD measure[edit]

FICO scores aggregate various factors, but PD is not a primary factor. The article doesn't cite any references for a FICO/PD relationship. I understand the FICO score to be measuring how much unusued credit line a person has, and how reliable recent debts have been handled, not any sense of PD in terms of net worth, "moral character", or current personal situations. PD is only weakly related, in the sense that an overextended consumer is necessarily going to have a higher PD. So the article shouldn't be equating FICO with PD. Richard J Kinch (talk) 13:32, 28 August 2019 (UTC)[reply]