A Corporate Credit Rating Model Using Support Vector Domain Combined with Fuzzy Clustering Algorithm

Abstract

Corporate credit‐rating prediction using statistical and artificial intelligence techniques has received considerable attentions in the literature. Different from the thoughts of various techniques for adopting support vector machines as binary classifiers originally, a new method, based on support vector domain combined with fuzzy clustering algorithm for multiclassification, is proposed in the paper to accomplish corporate credit rating. By data preprocessing using fuzzy clustering algorithm, only the boundary data points are selected as training samples to accomplish support vector domain specification to reduce computational cost and also achieve better performance. To validate the proposed methodology, real‐world cases are used for experiments, with results compared with conventional multiclassification support vector machine approaches and other artificial intelligence techniques. The results show that the proposed model improves the performance of corporate credit‐rating with less computational consumption.