Magazine article American Banker

HNC Pushes Neural Network Loan System

Magazine article American Banker

HNC Pushes Neural Network Loan System

Article excerpt

The national rollout of a popular neural network-based product has signaled an expanding role for artificial intelligence technology within the financial industry.

HNC Software Inc. has started a greater market push for its Automated Real Estate Analysis System, also known as AREAS, which gauges the current market value of residential property using neural network modeling and advanced statistics.

Neural networks are computer systems programmed to "think" like the human brain, discerning complex patterns and relationships among hundreds or thousands of examples that are fed into their memory.

Neural networks have received a fair amount of use .in the credit card arena. For example, the nation's four fastest-growing credit card issuers. all employ HNC's Falcon product to help detect fraud.

But the expansion of this technology into the more staid banking business segment of lending gives neural networks substantial credibility in the industry, identifying them more as workable tools than as flashy, high-tech contraptions.

"For whatever reason, artificial intelligence has been knocking at their [real estate bankers'] doors for five to 10 years now," said Michael Jackman, vice president for lender systems at HNC. "Now, they're finally beginning to welcome it with open arms."

Indeed, AREAS has already been around for several months, although not in its current form.

The national rollout also marks the release of the 3.0 version of the software, which has evolved largely from testing at Household International during the past year. …

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