You are part of a team of analysts who have been given the task of analysing a
process for handling mortgage approvals at a bank. Because of possible change in the
market, the company estimates a raise by a factor 2 of the number of arriving
mortgage requests.
The mortgage lending office of the bank currently processes 3000 loan applications
per year. It takes about 2 weeks to process an application.
a. On average, how many loan applications are in status “under processing” at a
given point in time?
b. How many loan applications would be handled at a given point in time if the
number of mortgage requests doubles as expected, assuming it still takes on
average 2 weeks to process an application?
Your team conducted an initial series of meetings in order to understand the existing
process. The meetings involved several loan officers, loan office assistants, a loan risk
manager, and the mortgage loan manager (who is responsible for the administration of
the bank's mortgage lending unit). From this workshop, you obtained the following
list of “most important” activities in the process, which are roughly listed in the order
they occur (but some activities may be done in parallel):
• Collect information about customer in own IT systems and if it is a new
customer, create the customer record and enter the required information
• Contact the land registry by letter or phone to check existing ownership in the
land and wait for their reply by letter, which could take about a week.
• Collect information about the house; the taxable value, the location, the urban
planning for the location, etc. This is done at the local authorities office.
• Check user in the country’s bad payment register, which is accessed through a
web browser
• Make risk analysis of mortgage request based on customer profile and
information about the house
• Send rejection of request if user is in bad payment register or risk is too high.
• Manager has to handle request if risk is high
• Create the loan in the IT systems
• Transfer money to customer
• Send confirmation letter to customer
process for handling mortgage approvals at a bank. Because of possible change in the
market, the company estimates a raise by a factor 2 of the number of arriving
mortgage requests.
The mortgage lending office of the bank currently processes 3000 loan applications
per year. It takes about 2 weeks to process an application.
a. On average, how many loan applications are in status “under processing” at a
given point in time?
b. How many loan applications would be handled at a given point in time if the
number of mortgage requests doubles as expected, assuming it still takes on
average 2 weeks to process an application?
Your team conducted an initial series of meetings in order to understand the existing
process. The meetings involved several loan officers, loan office assistants, a loan risk
manager, and the mortgage loan manager (who is responsible for the administration of
the bank's mortgage lending unit). From this workshop, you obtained the following
list of “most important” activities in the process, which are roughly listed in the order
they occur (but some activities may be done in parallel):
• Collect information about customer in own IT systems and if it is a new
customer, create the customer record and enter the required information
• Contact the land registry by letter or phone to check existing ownership in the
land and wait for their reply by letter, which could take about a week.
• Collect information about the house; the taxable value, the location, the urban
planning for the location, etc. This is done at the local authorities office.
• Check user in the country’s bad payment register, which is accessed through a
web browser
• Make risk analysis of mortgage request based on customer profile and
information about the house
• Send rejection of request if user is in bad payment register or risk is too high.
• Manager has to handle request if risk is high
• Create the loan in the IT systems
• Transfer money to customer
• Send confirmation letter to customer
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