• Asia pacific journal of information systems
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• v.19 no.2
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• pp.157-178
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• 2009

Corporate credit rating is a very important factor in the market for corporate debt. Information concerning corporate operations is often disseminated to market participants through the changes in credit ratings that are published by professional rating agencies, such as Standard and Poor's (S&P) and Moody's Investor Service. Since these agencies generally require a large fee for the service, and the periodically provided ratings sometimes do not reflect the default risk of the company at the time, it may be advantageous for bond-market participants to be able to classify credit ratings before the agencies actually publish them. As a result, it is very important for companies (especially, financial companies) to develop a proper model of credit rating. From a technical perspective, the credit rating constitutes a typical, multiclass, classification problem because rating agencies generally have ten or more categories of ratings. For example, S&P's ratings range from AAA for the highest-quality bonds to D for the lowest-quality bonds. The professional rating agencies emphasize the importance of analysts' subjective judgments in the determination of credit ratings. However, in practice, a mathematical model that uses the financial variables of companies plays an important role in determining credit ratings, since it is convenient to apply and cost efficient. These financial variables include the ratios that represent a company's leverage status, liquidity status, and profitability status. Several statistical and artificial intelligence (AI) techniques have been applied as tools for predicting credit ratings. Among them, artificial neural networks are most prevalent in the area of finance because of their broad applicability to many business problems and their preeminent ability to adapt. However, artificial neural networks also have many defects, including the difficulty in determining the values of the control parameters and the number of processing elements in the layer as well as the risk of over-fitting. Of late, because of their robustness and high accuracy, support vector machines (SVMs) have become popular as a solution for problems with generating accurate prediction. An SVM's solution may be globally optimal because SVMs seek to minimize structural risk. On the other hand, artificial neural network models may tend to find locally optimal solutions because they seek to minimize empirical risk. In addition, no parameters need to be tuned in SVMs, barring the upper bound for non-separable cases in linear SVMs. Since SVMs were originally devised for binary classification, however they are not intrinsically geared for multiclass classifications as in credit ratings. Thus, researchers have tried to extend the original SVM to multiclass classification. Hitherto, a variety of techniques to extend standard SVMs to multiclass SVMs (MSVMs) has been proposed in the literature Only a few types of MSVM are, however, tested using prior studies that apply MSVMs to credit ratings studies. In this study, we examined six different techniques of MSVMs: (1) One-Against-One, (2) One-Against-AIL (3) DAGSVM, (4) ECOC, (5) Method of Weston and Watkins, and (6) Method of Crammer and Singer. In addition, we examined the prediction accuracy of some modified version of conventional MSVM techniques. To find the most appropriate technique of MSVMs for corporate bond rating, we applied all the techniques of MSVMs to a real-world case of credit rating in Korea. The best application is in corporate bond rating, which is the most frequently studied area of credit rating for specific debt issues or other financial obligations. For our study the research data were collected from National Information and Credit Evaluation, Inc., a major bond-rating company in Korea. The data set is comprised of the bond-ratings for the year 2002 and various financial variables for 1,295 companies from the manufacturing industry in Korea. We compared the results of these techniques with one another, and with those of traditional methods for credit ratings, such as multiple discriminant analysis (MDA), multinomial logistic regression (MLOGIT), and artificial neural networks (ANNs). As a result, we found that DAGSVM with an ordered list was the best approach for the prediction of bond rating. In addition, we found that the modified version of ECOC approach can yield higher prediction accuracy for the cases showing clear patterns.

• Journal of Intelligence and Information Systems
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• v.18 no.1
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• pp.125-141
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• 2012

These days, the malicious attacks and hacks on the networked systems are dramatically increasing, and the patterns of them are changing rapidly. Consequently, it becomes more important to appropriately handle these malicious attacks and hacks, and there exist sufficient interests and demand in effective network security systems just like intrusion detection systems. Intrusion detection systems are the network security systems for detecting, identifying and responding to unauthorized or abnormal activities appropriately. Conventional intrusion detection systems have generally been designed using the experts' implicit knowledge on the network intrusions or the hackers' abnormal behaviors. However, they cannot handle new or unknown patterns of the network attacks, although they perform very well under the normal situation. As a result, recent studies on intrusion detection systems use artificial intelligence techniques, which can proactively respond to the unknown threats. For a long time, researchers have adopted and tested various kinds of artificial intelligence techniques such as artificial neural networks, decision trees, and support vector machines to detect intrusions on the network. However, most of them have just applied these techniques singularly, even though combining the techniques may lead to better detection. With this reason, we propose a new integrated model for intrusion detection. Our model is designed to combine prediction results of four different binary classification models-logistic regression (LOGIT), decision trees (DT), artificial neural networks (ANN), and support vector machines (SVM), which may be complementary to each other. As a tool for finding optimal combining weights, genetic algorithms (GA) are used. Our proposed model is designed to be built in two steps. At the first step, the optimal integration model whose prediction error (i.e. erroneous classification rate) is the least is generated. After that, in the second step, it explores the optimal classification threshold for determining intrusions, which minimizes the total misclassification cost. To calculate the total misclassification cost of intrusion detection system, we need to understand its asymmetric error cost scheme. Generally, there are two common forms of errors in intrusion detection. The first error type is the False-Positive Error (FPE). In the case of FPE, the wrong judgment on it may result in the unnecessary fixation. The second error type is the False-Negative Error (FNE) that mainly misjudges the malware of the program as normal. Compared to FPE, FNE is more fatal. Thus, total misclassification cost is more affected by FNE rather than FPE. To validate the practical applicability of our model, we applied it to the real-world dataset for network intrusion detection. The experimental dataset was collected from the IDS sensor of an official institution in Korea from January to June 2010. We collected 15,000 log data in total, and selected 10,000 samples from them by using random sampling method. Also, we compared the results from our model with the results from single techniques to confirm the superiority of the proposed model. LOGIT and DT was experimented using PASW Statistics v18.0, and ANN was experimented using Neuroshell R4.0. For SVM, LIBSVM v2.90-a freeware for training SVM classifier-was used. Empirical results showed that our proposed model based on GA outperformed all the other comparative models in detecting network intrusions from the accuracy perspective. They also showed that the proposed model outperformed all the other comparative models in the total misclassification cost perspective. Consequently, it is expected that our study may contribute to build cost-effective intelligent intrusion detection systems.

• Journal of Intelligence and Information Systems
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• v.27 no.1
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• pp.23-46
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• 2021

Collaborative filtering, which is often used in personalization recommendations, is recognized as a very useful technique to find similar customers and recommend products to them based on their purchase history. However, the traditional collaborative filtering technique has raised the question of having difficulty calculating the similarity for new customers or products due to the method of calculating similaritiesbased on direct connections and common features among customers. For this reason, a hybrid technique was designed to use content-based filtering techniques together. On the one hand, efforts have been made to solve these problems by applying the structural characteristics of social networks. This applies a method of indirectly calculating similarities through their similar customers placed between them. This means creating a customer's network based on purchasing data and calculating the similarity between the two based on the features of the network that indirectly connects the two customers within this network. Such similarity can be used as a measure to predict whether the target customer accepts recommendations. The centrality metrics of networks can be utilized for the calculation of these similarities. Different centrality metrics have important implications in that they may have different effects on recommended performance. In this study, furthermore, the effect of these centrality metrics on the performance of recommendation may vary depending on recommender algorithms. In addition, recommendation techniques using network analysis can be expected to contribute to increasing recommendation performance even if they apply not only to new customers or products but also to entire customers or products. By considering a customer's purchase of an item as a link generated between the customer and the item on the network, the prediction of user acceptance of recommendation is solved as a prediction of whether a new link will be created between them. As the classification models fit the purpose of solving the binary problem of whether the link is engaged or not, decision tree, k-nearest neighbors (KNN), logistic regression, artificial neural network, and support vector machine (SVM) are selected in the research. The data for performance evaluation used order data collected from an online shopping mall over four years and two months. Among them, the previous three years and eight months constitute social networks composed of and the experiment was conducted by organizing the data collected into the social network. The next four months' records were used to train and evaluate recommender models. Experiments with the centrality metrics applied to each model show that the recommendation acceptance rates of the centrality metrics are different for each algorithm at a meaningful level. In this work, we analyzed only four commonly used centrality metrics: degree centrality, betweenness centrality, closeness centrality, and eigenvector centrality. Eigenvector centrality records the lowest performance in all models except support vector machines. Closeness centrality and betweenness centrality show similar performance across all models. Degree centrality ranking moderate across overall models while betweenness centrality always ranking higher than degree centrality. Finally, closeness centrality is characterized by distinct differences in performance according to the model. It ranks first in logistic regression, artificial neural network, and decision tree withnumerically high performance. However, it only records very low rankings in support vector machine and K-neighborhood with low-performance levels. As the experiment results reveal, in a classification model, network centrality metrics over a subnetwork that connects the two nodes can effectively predict the connectivity between two nodes in a social network. Furthermore, each metric has a different performance depending on the classification model type. This result implies that choosing appropriate metrics for each algorithm can lead to achieving higher recommendation performance. In general, betweenness centrality can guarantee a high level of performance in any model. It would be possible to consider the introduction of proximity centrality to obtain higher performance for certain models.

• Journal of Broadcast Engineering
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• v.19 no.5
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• pp.578-589
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• 2014

Window image is displayed through a monitor screen when we execute the application programs on the computer. This includes webpage, video player and a number of applications. The webpage delivers a variety of information by various types in comparison with other application. Unlike a natural image captured from a camera, the window image like a webpage includes diverse components such as text, logo, icon, subimage and so on. Each component delivers various types of information to users. However, the components with different characteristic need to be divided locally, because text and image are served by various type. In this paper, we divide window images into many sub blocks, and classify each divided region into background, text and subimage. The detected subimages can be applied into 2D-to-3D conversion, image retrieval, image browsing and so forth. There are many subimage classification methods. In this paper, we utilize AdaBoost for verifying that the machine learning-based algorithm can be efficient for subimage detection. In the experiment, we showed that the subimage detection ratio is 93.4 % and false alarm is 13 %.

• Journal of the Korea Institute of Information Security & Cryptology
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• v.30 no.4
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• pp.617-629
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• 2020

In order to overcome the limitations of the rule-based intrusion detection system due to changes in Internet computing environments, the emergence of new services, and creativity of attackers, network anomaly detection (NAD) using machine learning and deep learning technologies has received much attention. Most of these existing machine learning and deep learning technologies for NAD use supervised learning methods to learn a set of training data set labeled 'normal' and 'attack'. This paper presents the feasibility of the unsupervised learning AutoEncoder(AE) to NAD from data sets collecting of secured network traffic without labeled responses. To verify the performance of the proposed AE mode, we present the experimental results in terms of accuracy, precision, recall, f1-score, and ROC AUC value on the NSL-KDD training and test data sets. In particular, we model a reference AE through the deep analysis of diverse AEs varying hyper-parameters such as the number of layers as well as considering the regularization and denoising effects. The reference model shows the f1-scores 90.4% and 89% of binary classification on the KDDTest+ and KDDTest-21 test data sets based on the threshold of the 82-th percentile of the AE reconstruction error of the training data set.

• The Journal of the Korea Contents Association
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• v.18 no.8
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• pp.525-535
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• 2018

If the frequency of a particular class is excessively higher than the frequency of other classes in the classification problem, data imbalance problems occur, which make machine learning distorted. Corporate bankruptcy prediction often suffers from data imbalance problems since the ratio of insolvent companies is generally very low, whereas the ratio of solvent companies is very high. To mitigate these problems, it is required to apply a proper sampling technique. Until now, oversampling techniques which adjust the class distribution of a data set by sampling minor class with replacement have popularly been used. However, they are a risk of overfitting. Under this background, this study proposes ROSE(Random Over Sampling Examples) technique which is proposed by Menardi and Torelli in 2014 for the effective corporate bankruptcy prediction. The ROSE technique creates new learning samples by synthesizing the samples for learning, so it leads to better prediction accuracy of the classifiers while avoiding the risk of overfitting. Specifically, our study proposes to combine the ROSE method with SVM(support vector machine), which is known as the best binary classifier. We applied the proposed method to a real-world bankruptcy prediction case of a Korean major bank, and compared its performance with other sampling techniques. Experimental results showed that ROSE contributed to the improvement of the prediction accuracy of SVM in bankruptcy prediction compared to other techniques, with statistical significance. These results shed a light on the fact that ROSE can be a good alternative for resolving data imbalance problems of the prediction problems in social science area other than bankruptcy prediction.

• Journal of KIISE
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• v.41 no.9
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• pp.666-673
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• 2014

This paper proposes a scalable face recognition method for unconstrained face databases, and shows a simple experimental result. Existing face recognition research usually has focused on improving the recognition rate in a constrained environment where illumination, face alignment, facial expression, and background is controlled. Therefore, it cannot be applied in unconstrained face databases. The proposed system is face feature extraction algorithm for unconstrained face recognition. First of all, we extract the area that represent the important features(landmarks) in the face, like the eyes, nose, and mouth. Each landmark is represented by a high-dimensional LBP(Local Binary Pattern) histogram feature vector. The multi-scale LBP histogram vector corresponding to a single landmark, becomes a low-dimensional face feature vector through the feature reduction process, PCA(Principal Component Analysis) and LDA(Linear Discriminant Analysis). We use the Rank acquisition method and Precision at k(p@k) performance verification method for verifying the face recognition performance of the low-dimensional face feature by the proposed algorithm. To generate the experimental results of face recognition we used the FERET, LFW and PubFig83 database. The face recognition system using the proposed algorithm showed a better classification performance over the existing methods.

• Korean Journal of Social Welfare
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• v.68 no.2
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• pp.213-232
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• 2016

The purpose of this study is to explore the stress profile that adolescent perceives by using Latent Profile Analysis (LPA), and to examine the effect of characteristics variable per groups that appeared in profile. By using the cross-section data of 'A survey on the human right of Korean children and adolescent in 2013' issued by National Youth Policy Institute, the LPA concerning the stress type was conducted and surveyed 9,521 adolescents from fourth grade in elementary school to seniors in high school nationwide. The result of this study shows that two class types were selected according to the goodness-of-fit index and latent class classification rate. Type 1 is named low-risk group as they show low level, whereas type 2 is named relative risk group as they show high level. In order to predict the characteristics of adolescent stress, the study conducted Binary Logistic Regression analysis on the basis of low-risk group. There is higher probability to belong to relative risk group, the more they are female students than male students, the less their subjective health condition and happiness, the more runaway experience, the less school grades and the less economic affluence in their household. The implication of this research, its limitation and direction of follow-up research were suggested.

• Journal of Navigation and Port Research
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• v.41 no.6
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• pp.445-450
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• 2017

It is necessary to set a route to reflect the traffic flow for the safety of the traffic vessels. This ongoing analysis is needed to ensure that the vessels comply with a route. The purpose of this study is to discover the problems of the recommended route vicinity for Wando Harbor and suggest an improvement plan. We used a support vector machine based on the ship's trajectory to establish an efficient route center line. Since the vessels should navigate to the starboard side, with reference to the center line of the recommended route, the trajectories of the vessels were divided into two clusters. The support vector machine is being used in many fields such as pattern recognition, and it is effective for this binary classification. As a result of this study, about 79.5 % of the merchant eastbound ships in a 2.4 NM distance to Jangjuk Sudo did not observe the recommended route, so the risk of collision always existed. The contraflow traffic rate of the route of the eastbound ships decreased from 79.5 % to 30.9 % when the recommended route was reset about 300 meters to the north, from its present position. The support vector machine applied in this study is expected to be applicable, to effectively set the route center line because the ship trajectories can be classified into two clusters.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.16 no.2
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• pp.1414-1419
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• 2015

A method for detecting a skin region on the image is generally used to detect the color information. However, If saturation lowered, skin detection is difficult because hue information of the pixels is lost. So in this paper, we propose a method of correcting color of lower saturation of skin region images by the lighting. Color correction process of this method is saturation image acquisition and low-saturation region classification, segmentation, and the saturation of the split in the low saturation region extraction and color values, the color correction sequence. This method extracts the low saturation regions in the image and extract the color and saturation in the region and the surrounding region to produce a color similar to the original color. Therefore, the method of extracting the low saturation region should be correctly preceding. Because more accurate segmentation in the process of obtaining a low saturation regions, we use a multi-threshold method proposed Otsu in Hue values of the HSV color space, and create a binary image. Our experimental results for 170 portrait images show a possibility that the proposed method could be used efficiently preprocessing of skin color detection method, because the detection result of proposed method is 5.8% higher than not used it.