A multi-objective approach for the prediction of loan defaults

Credit institutions are seldom faced with problems dealing with single objectives. Often, decisions involving optimizing two or more competing goals simultaneously need to be made, and conventional optimization routines and models are incapable of handling the problems. This study applies Fuzzy dominance based Simplex Genetic Algorithm (a multi-objective evolutionary optimization algorithm) in generating decision rules for predicting loan default in a typical credit institution. Categories and Subject Descriptors I.2.8 [Artificial Intelligence]: Problem Solving, Control Methods and Search – graph and tree search strategies, heuristic methods. General Terms Algorithms, Theory. Keywords Multi-objective optimization, Fuzzy Inference, Loan default, Prediction.

• Type: Conference
• Year: 2007
• Where: GECCO
• Authors: Oluwarotimi Odeh, Praveen Koduru, Sanjoy Das, Allen M. Featherstone, Stephen Welch
• Keywords: Conventional Optimization Routines, Credit Institution, GECCO 2007, Loan Default