Modeling Financial Risk in Telecommunication Field

Natalia V. Kuznietsova, Petro I. Bidyuk


Background. The telecommunication field in Ukraine is dynamically developing continuously renewing its proposals for the market and consumer requirements. That is why a timely estimation of financial risks and optimization of financial expenses regarding development of new components and possible losses of clients is especially urgent problem today.

Objective. The aim of the paper is to suggest an approach for estimation of financial risks and forecasting of the client loss and optimal service time utilization based on intellectual data analysis and behavior models.

Methods. To determine the probability of customer loss the neural networks theory, gradient busting, random forest and logistic regression are used. The survival analysis models for possible client transition time to another company are developed.

Results. The best model for forecasting the clients intending for transition to another telecommunication company turned out to be the one based on gradient busting.

Conclusions. It was shown that timely estimation of financial losses, provoked by possible loss of clients, is an urgent task for intellectual data analysis. A perspective approach for optimization of the company financial resources is determining the time period related to possible loss of clients.


Telecommunication company; Financial risks; Survival models; Gradient busting; Neural network; Logistic regression


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