HOW TO SUCCEED IN TIMES OF risk

KNOW WHAT YOU’RE missing

Do I understand the credit and collateral risk drivers and composition of my portfolios? Can I properly assess the value and risk potential of distressed loans? What happens to my capital position if my Balance Sheet composition or broader market deteriorates even further? Do I have the capability to estimate loss reserves adequately? Am I comfortable answering all of the regulators questions? KNOW WHAT YOU’RE missing

Primatics Financial’s Evolv Risk platform has the tools to answer your key risk questions—so you can make business decisions that lead beyond survival, to success. KNOW WHAT YOU’RE missing

KNOW YOU NEED answers

Evolv Risk is ideal for: banks mortgage insurers securities investors hedge funds and private equity firms KNOW YOU NEED answers

Use Evolv Risk to: balance the risk and rewards for valuing acquired and existing consumer and commercial loans determine securities investors alternative pricing determine risk management and segmentation strategies for best execution purposes KNOW YOU NEED answers

ASK THE HARD questions

How do I generate cash flows on a toxic portfolio? 1 Evolv Risk is integrated with complex credit, prepayment and roll rate models using monte-carlo simulations and recent performance for cash flow generation and model based valuation. ASK THE HARD questions

How is the performance of the portfolio affected over time? 2 Evolv Risk creates comparative and trending reports that provide deeper insights you need. The continuous assessment of your expectations of performance to actual is critical for success. ASK THE HARD questions

How can I identify toxic loans for modifications? 3 Evolv Risk uses models that identify loans on the verge of delinquency and default, giving you an opportunity to modify them and reduce chances of foreclosure or decline in ROI. ASK THE HARD questions

How did the portfolio get where it is? 4 Evolv Risk conducts thorough portfolio inspection, providing a comprehensive view of causes and effects. ASK THE HARD questions How prepared is my organization for the portfolio risk? 5 Evolv Risk can run a variety of execution scenarios to approximate both losses and associated capital requirements.

What would happen if HPI falls drastically, etc.? 6 Evolv Risk performs scenario analysis to stress your assumptions, giving you an informed look into the future. ASK THE HARD questions

GET INFORMATION YOU need IN A FORMAT YOU CAN use

Meet the Challenges of Distressed Portfolios Evolv Risk: GET INFORMATION YOU need IN A FORMAT YOU CAN use Is market tested with a variety of distressed consumer portfolios. Processes complex cashflow schedules, including support for negative amortizing products with payment recasts.

Meet the Challenges of Distressed Portfolios Evolv Risk: GET INFORMATION YOU need IN A FORMAT YOU CAN use Utilizes three home price indices: Case-Shiller, OFHEO and National Association of Realtors. Incorporates credit, prepayment and loss curve models. Applies custom index-rate forecasts.

Meet the Challenges of Distressed Portfolios Evolv Risk: GET INFORMATION YOU need IN A FORMAT YOU CAN use Supports a broad range of loan products, including fixed-rate, hybrid ARM, interest-only, option ARM, balloon, construction, and home equity line of credit. Is integrated with proprietary and user based roll rate models for enhanced risk assessment and reporting

Generate Customized Analysis and Reports Evolv Risk: GET INFORMATION YOU need IN A FORMAT YOU CAN use Enables you to define scenarios and models, adjust HPI and rate forecasts, navigate cash flows, and inspect loan- level scenario outcome. Generates web-based displays of information, with dynamic drill-down capabilities.

Generate Customized Analysis and Reports Evolv Risk: GET INFORMATION YOU need IN A FORMAT YOU CAN use Provides dashboard snapshots of results for management review. Easily integrates with data repositories and export capabilities.

TARGET KEY PROCESS issues

Now you can quickly and decisively target the key issues your organization faces around credit and interest rate risk for both residential and commercial loan portfolios. TARGET KEY PROCESS issues

Challenges Managing complex data rules to transform source system data into model-ready data can be an arduous and frustrating task. Maintenance of rules often requires complex system enhancements. Managing audit and controls around data is inefficient and impractical. TARGET KEY PROCESS issues The Evolv Risk Solution: Proprietary Loan Data Import Rule Engine

Your Advantages The Excel-style interface easily transforms source data into model- ready data. Embedded validation rules are maintained by the user, with no system enhancement required. Complete audit and controls work with original and transformed source data. TARGET KEY PROCESS issues

Challenges Inflexible platforms do not allow you to plug in custom programmatic or non- programmatic models. Internal limitations, such as hardware cost or maintenance, constrain performance. TARGET KEY PROCESS issues The Evolv Risk Solution: Loan Risk Model Rule Engine, Cloud Computing, open interface architecture

Your Advantages Built-in support for non-programmatic models lets you define your own models in an Excel- type interface, and even upload programmatic models directly into the system. An on-demand computing environment means you pay hardware costs only for usage. The cost-effective approach is also highly secure. Your data is processed and destroyed, never stored. TARGET KEY PROCESS issues

Challenges Reports are canned and not ad-hoc. It can be difficult to drill down into problem areas for more detail. TARGET KEY PROCESS issues The Evolv Risk Solution: Loan Analytics and Reporting Tool

Your Advantages Embedded OLAP (online analytical processing) functionality delivers vital flexibility. Drill-down capabilities provide the level of insight you need. TARGET KEY PROCESS issues

USE WHAT works

1 Get Lowest Level Data Asset Detail Deal Info Tranche Info Historical Payment Information USE WHAT works

2 Determine Market Assumptions Interest Rate Projections HPI Projections (National, State or MSA Level) Foreclosure Timelines Organize Assumptions into Scenarios (Likely vs. Toxic) USE WHAT works

3 Generate Future Cashflows Scheduled Cash Flows Unscheduled Prepayments Defaults / Recoveries Deterministic vs. Stochastic Scenarios Roll Rate migration matrices USE WHAT works

4 Generate Risk Metrics / Intrinsic Value Conditional Default Rates (CDR) Loss Severity Rates (LSR) Loss Coverage Multiple Unrealized Loss % USE WHAT works

5 Roll Up Metrics to Holding Level CDR / LSR at the Tranche Level Account for Credit Protection USE WHAT works

6 Perform Stress Test / Drill-down Analysis Results Across Vintage, Products, MSA, FICO, Issuer, etc. Run Detailed Analytics on Specific Sub-Set Loan Level Cash Flows and Fair Value USE WHAT works

MODEL WITH confidence

Supported Products Adjustable Rate Products Option ARMs Home Equity Lines of Credit Support for both first and second Liens Support for Prime, Sub Prime, ALT-A Construction Mortgages MODEL WITH confidence

Key Model Drivers FICO Equity in the House Coupon (Refi Incentive) Market Loan to Value (Adjusted for HPI changes) Product Type, Seasonality, and more MODEL WITH confidence

Roll Rate Matrices Develop cohort curve estimations by delinquency buckets Track historical and current loan status transitions Record and track Charge-off information Generate loan loss estimations MODEL WITH confidence

TAKE CHARGE OF success Evolv Risk—the first and only web-based risk management platform—delivers the flexibility and computing power of an enterprise analysis solution at an impressive cost savings.