Thanks to a unique collaboration between the private sector and the world of academia, students in the professional applied and computational math (PACM) graduate program are mastering the application of complex mathematical principles.
For example, on Wednesday, April 11, students taking Markov Chain Models in Credit Risk Management (ACM 653) will present their class projects to faculty from the Mathematics Department, management from M&T, and other members of the advisory board for the PACM program. The course is taught by Matthew Nagowski, a vice president at M&T Bank and quantitative modeling manager in their Treasury Division.
A Markov chain is a mathematical concept that consists of a finite number of states and some known probabilities. Nagowski has a great deal of experience in applying that concept in the financial sector.
"In the PACM program, we take advantage of the valuable experience that industry leaders can bring to our students," explained Joaquin Carbonara, professor of mathematics and coordinator of the PACM program. "PACM merges industry and academia by combining the talent and experience from industry with the academic rigor provided by our faculty."
Nagowski and others from M&T became involved with the PACM program when the applied math faculty invited them to give a presentation on the role of applied mathematics in banking and finance. Thanks to flexibility built into the 30-credit-hour PACM program, experts such as Nagowski can serve as adjunct faculty members for one-credit, five-week courses that focus on a specialty.
"Finance and banking requires more than just accounting," said Nagowski. "Mathematical modeling plays a crucial role in the decisions that all financial institutions make—from whether or not to extend credit to a borrower and figuring out how to best charge our customers to understanding the interest rate sensitivity of our deposits and the stability of our funding sources. Applied mathematicians and statisticians are essential to the industry, and will only be more so in the future."
Other specialized courses include Empirical Model Building, Eigenvalue Problems, and Logistic Regression. "The five-week, 1-credit-hour classes enable the program to be nimble and responsive to industry’s demands," said Carbonara. The courses demand extensive prerequisites, including, in one case, linear algebra; statistics I and II; introduction to programming; and, preferably, intermediate microeconomics and intermediate macroeconomics.
The PACM program is recognized as a professional science master’s (PSM) degree by the Council of Graduate Schools. The Alfred P. Sloan Foundation funded the development of the program, and funds for tuition and stipends are available on a competitive basis from the National Science Foundation for full-time students.
PSM programs prepare students to pursue scientific and mathematics careers in the business sector as scientists, mathematicians, and managers. In addition to providing in-depth exposure to the application of complex scientific and/or mathematics principles, graduates have studied project management, business communication, and operations management.
"We are very excited to offer this program to the Western New York area at a time when so many opportunities for applied mathematicians are becoming available," said Carbonara. "Thanks to computer technology, businesses have almost unlimited data available to them. Applied mathematicians enable businesses to make use of the data."
