An Analysis of the Turn-Around Time in Processing of Simple and Complex Auto Loans of Bank Xyz

Analysis and evaluation stage is a single channel, interest rate multi channel, loan terms single channel, and final issuing a multichannel. (Exhibit A)The current structure of the analysis and evaluation stage does not maximize staff time effectively and as a consequence creates a bottleneck in the process. With the single channel structure loan applications are unevenly distributed among teams and create higher idle time for teams with less volume of loan applications to process. Utilization among regions varies greatly between 73% - 95%. The following observation of the current structure was achieved using the MMK model (See exhibit B):

Furthermore, the need to recall certain customers increased the overall process duration. As a result, many potentially qualified customers are lost due to self-withdrawal. Second, we’ve concluded the underwriting process is the bottleneck of the entire operation. Currently, it takes an average of 40.5 minutes per application to be put through. By comparing the inflow and outflow numbers, the yield/throughput results to .33. Two factors contribute to the low yield rate. 1) As mentioned earlier, 14.6 of the 100 inputted applicants withdrew their applications due to the process duration. 2) Of the remaining applications, 52 of the 100 inputted applicants were rejected because they were not qualified. Lastly, looking into the quality assessment procedure, no additional work value is added to the application. However, accurate information is vital before the application is passed through. The two associates in this step create a supply constraint for the overall process. This is evident in that the implied utilization measures 1.08, meaning the two associates cannot complete all tasks.

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Where relevant to the reasonableness of the significant assumptions used by management or the appropriate application of the applicable financial reporting framework, management's intent to carry out specific courses of action and its ability to do so.

Problem 2.4: Consider the sample from a bank database shown in Figure 2.14; it was selected randomly from a larger database to be the training set. Personal Loan indicates whether a solicitation for a personal loan was accepted and is the response variable. A campaign is planned for a similar solicitation in the future, and the bank is looking for a model that will identify likely responders. Examine the data carefully and indicate what your next step would be.

AJ DAVIS is a department store chain, which has many credit customers. A sample of 50 credit customers is selected with data collected on location, income, credit balance, number of people and years lived in the house

Where π1 and π2 are prior probabilities of good and bad credit populations, Q (2∣1) and Q (1∣2) compute the probability of making Type I errors, i.e., a customer with good credit is misclassified as a customer with bad credit, and Type II errors, i.e., a customer with bad credit is misclassified as a customer with good credit, and A (2∣1) as well as A (1∣2) are the corresponding misclassification costs of Type I and Type II errors.

You are the HR manager for an upscale retail store which sells clothing, shoes, handbags, and other accessories. Due to the economic downturn, the company has experienced a significant reduction in earnings, resulting in the layoff of a number of retail sales associates. Business seems to be rebounding, but you are concerned about the performance of the retail sales

upon in advance by management and key personnel of the steps that will be taken to help the

The four perspectives in a balanced scorecard are, financial perspective, internal business process perspective, customer perspective, and learning and growth perspective. In the financial perspective area of Quicken Loans starts with them being a for-profit organization. In the financial perspective one of the main interests is shareholders interest. When looking at the shareholder’s interest there are two different categories they look at, revenue growth and productivity objective. To grow revenue of Quicken Loans they would have to work on developing new revenue sources by tapping into different markets. Along with that they should also be improving current profitability by increasing their profits from their current clients. On the other side, there is productivity objectives which are completed by the employees. This area of the financial perspective focuses on decreasing costs and resource optimization.

6. Based on findings from questions 1-5 we can conclude that the relationship between credit balance and size is linear with positive correlation. That is model is useful for predicting the credit balance using the variable size as a independent variable.

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Lending evaluations by Santander are based on credit background of the person (or company) who wants borrow. Through the development of a credit-approval system, Santander Consumer Finance increased an understanding into these clients on an online database which allowed for the use of real time analysis in determining interest rates for the business interactions.

Peter Nicholson wishes to convert the factory in the north east to production of the electric taxi. Using data in Appendix C, Table 1, calculate payback period and the average rate of return.

1.) Selected option should lead to a reduction in working capital requirement and reduce short term debt in the process.