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Chapter 25
Novita Ikasari
Curtin University, Australia & University of Indonesia, Indonesia
Fedja Hadzic
Curtin University, Australia
Tharam S. Dillon
Curtin University, Australia
Incorporating Qualitative
Information for Credit Risk
Assessment through Frequent
Subtree Mining for XML
ABSTRACT
Credit risk assessment has been one of the most appealing topics in banking and fnance studies, at-
tracting both scholars’ and practitioners’ attention for some time. Following the success of the Grameen
Bank, works on credit risk, in particular for Small Medium Enterprises (SMEs), have become essential.
The distinctive character of SMEs requires a method that takes into account quantitative and qualitative
information for loan granting decision purposes. In this chapter, we frst provide a survey of existing
credit risk assessment methods, which shows a current gap in the existing research in regards to taking
qualitative information into account during the data mining process. To address this shortcoming, we
propose a framework that utilizes an XML-based template to capture both qualitative and quantitative
information in this domain. By representing this information in a domain-oriented way, the potential
knowledge that can be discovered for evidence-based decision support will be maximized. An XML
document can be efectively represented as a rooted ordered labelled tree and a number of tree mining
methods exist that enable the efcient discovery of associations among tree-structured data objects, tak-
ing both the content and structure into account. The guidelines for correct and efective application of
such methods are provided in order to gain detailed insight into the information governing the decision
making process. We have obtained a number of textual reports from the banks regarding the information
DOI: 10.4018/978-1-4666-3886-0.ch025