scholarly journals Forecasting Bank Failure with Machine Learning Models: A study on Turkish Banks

2021 ◽  
Vol 3 (2) ◽  
pp. 51-59
Author(s):  
Safa SEN ◽  
Sara Almeida de Figueiredo

Forecasting bank failures has been an essential study in the literature due to their significant impact on the economic prosperity of a country. Acting as an intermediary player, banks channel funds from those with surplus capital to those who require capital to carry out their economic activities. Therefore, it is essential to generate early warning systems that could warn banks and stakeholders in case of financial turbulence. In this paper, three machine learning models named as GLMBoost, XGBoost, and SMO were used to forecast bank failures. We used commercial bank failure data of Turkey between 1997 and 2001, where we have 17 failed and 20 healthy banks. Our results show that the Sequential Minimal Optimization and GLMBoost provide the same performance when classifying failed banks, while GLMBoost performs better in AUC and SMO when considering total classification success. Lastly, XGBoost, one of the most recent and robust classification models, surprisingly underperformed in all three metrics we used in research.

2021 ◽  
Vol 3 (2) ◽  
pp. 43-50
Author(s):  
Safa SEN ◽  
Sara Almeida de Figueiredo

Predicting bank failures has been an essential subject in literature due to the significance of the banks for the economic prosperity of a country. Acting as an intermediary player of the economy, banks channel funds between creditors and debtors. In that matter, banks are considered the backbone of the economies; hence, it is important to create early warning systems that identify insolvent banks from solvent ones. Thus, Insolvent banks can apply for assistance and avoid bankruptcy in financially turbulent times. In this paper, we will focus on two different machine learning disciplines: Boosting and Cost-Sensitive methods to predict bank failures. Boosting methods are widely used in the literature due to their better prediction capability. However, Cost-Sensitive Forest is relatively new to the literature and originally invented to solve imbalance problems in software defect detection. Our results show that comparing to the boosting methods, Cost-Sensitive Forest particularly classifies failed banks more accurately. Thus, we suggest using the Cost-Sensitive Forest when predicting bank failures with imbalanced datasets.


2020 ◽  
Author(s):  
Sankavi Muralitharan ◽  
Walter Nelson ◽  
Shuang Di ◽  
Michael McGillion ◽  
PJ Devereaux ◽  
...  

BACKGROUND Timely identification of patients at a high risk of clinical deterioration is key to prioritizing care, allocating resources effectively and preventing adverse outcomes. Vital signs-based aggregate-weighted Early Warning Systems are commonly used to predict the risk of outcomes related to cardiorespiratory instability and sepsis, which are strong predictors of poor outcomes and mortality. Machine learning models, which can incorporate trends and capture relationships among parameters that aggregate-weighted models cannot, have recently been showing promising results. OBJECTIVE To identify, summarize, and evaluate the available research, current state of utility and challenges with machine learning based early warning systems using vital signs to predict the risk of physiological deterioration in acutely ill patients, across acute and ambulatory care settings. METHODS PubMed, CINAHL, Cochrane Library, Web of Science, Embase, and Google Scholar were searched for peer-reviewed, original studies with keywords related to “vital signs”, “clinical deterioration”, and “machine learning”. Included studies used patient vital signs along with demographics and described a machine learning model for predicting an outcome in acute and ambulatory care settings. Data were extracted following PRISMA, TRIPOD, and Cochrane Collaboration guidelines. RESULTS 24 peer-reviewed studies were identified for inclusion from 417 articles. 23 studies were retrospective, while 1 was prospective in nature. Care settings included general wards, ICUs, emergency departments, step-down units, medical assessment units, post-anesthetic wards, and home care. Machine learning models including logistic regression, tree-based methods, kernel-based methods and neural networks were most commonly used to predict the risk of deterioration. The area under the curve for models ranged from 0.57 to 0.97. CONCLUSIONS In studies that compared performance, reported results suggest that machine learning based early warning systems can achieve greater accuracy than aggregate weighted early warning systems but several areas for further research were identified. While these models have the potential to provide clinical decision support, there is a need for standardized outcome measures to allow for rigorous evaluation of performance across models. Further research needs to address the interpretability of model outputs by clinicians, clinical efficacy of these systems through prospective study design, and their potential impact in different clinical settings. CLINICALTRIAL


2020 ◽  
Vol 2 (1) ◽  
pp. 3-6
Author(s):  
Eric Holloway

Imagination Sampling is the usage of a person as an oracle for generating or improving machine learning models. Previous work demonstrated a general system for using Imagination Sampling for obtaining multibox models. Here, the possibility of importing such models as the starting point for further automatic enhancement is explored.


2021 ◽  
Author(s):  
Norberto Sánchez-Cruz ◽  
Jose L. Medina-Franco

<p>Epigenetic targets are a significant focus for drug discovery research, as demonstrated by the eight approved epigenetic drugs for treatment of cancer and the increasing availability of chemogenomic data related to epigenetics. This data represents a large amount of structure-activity relationships that has not been exploited thus far for the development of predictive models to support medicinal chemistry efforts. Herein, we report the first large-scale study of 26318 compounds with a quantitative measure of biological activity for 55 protein targets with epigenetic activity. Through a systematic comparison of machine learning models trained on molecular fingerprints of different design, we built predictive models with high accuracy for the epigenetic target profiling of small molecules. The models were thoroughly validated showing mean precisions up to 0.952 for the epigenetic target prediction task. Our results indicate that the herein reported models have considerable potential to identify small molecules with epigenetic activity. Therefore, our results were implemented as freely accessible and easy-to-use web application.</p>


2020 ◽  
Author(s):  
Shreya Reddy ◽  
Lisa Ewen ◽  
Pankti Patel ◽  
Prerak Patel ◽  
Ankit Kundal ◽  
...  

<p>As bots become more prevalent and smarter in the modern age of the internet, it becomes ever more important that they be identified and removed. Recent research has dictated that machine learning methods are accurate and the gold standard of bot identification on social media. Unfortunately, machine learning models do not come without their negative aspects such as lengthy training times, difficult feature selection, and overwhelming pre-processing tasks. To overcome these difficulties, we are proposing a blockchain framework for bot identification. At the current time, it is unknown how this method will perform, but it serves to prove the existence of an overwhelming gap of research under this area.<i></i></p>


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