AMP Bank Case Study

Improving Customer Service through Process Change

Content

Topic 1 Topic 2 Topic 3

AMP Bank Key Metrics & the Challenge Focus and Changes Implemented

Topic 4
Topic 5

Key Changes
Questions

Page 2

AMP Bank Overview

AMP Bank (established in 1998) is a fully owned subsidiary of AMP Ltd. Branchless bank with a core focus on Australian residential mortgages and deposits. Mortgage distribution is through financial planners, mortgage brokers, and direct sales. AMP Bank is an integral part of AMP Groups wider business leveraging its economies of scale. Securitisation of residential mortgages has been integral to AMP Banks capital, liquidity and funding management. The Banks strategy has been modified to accommodate the difficulties in the securitisation market. AMP Bank manages $12b of total assets with more than 100,000 customers

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AMP Bank Mortgage Growth

$1,1b

Mortgage growth

$334m

$220m

2009
Page 4 |

2010

2011

Market Performance has Driven Volatility

Home loan outstandings

AMP v Market, indexed to Dec 2006
170 160 150

Total market

Mortgage performance has led and lagged market, and is related to funding opportunities Daily home loan application volatility during growth periods is up to 50% This required the construction of an appropriate and cost effective operational model

Index value

140 130 120 110 100 90 80

AMP

Aug-07

Aug-08

Aug-09

Aug-10

Dec-06

Dec-07

Dec-08

Dec-09

Dec-10

Aug-11

Source: APRA monthly ADI reporting, indexed to value of 100 at December 2006

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Dec-11

Apr-07

Apr-08

Apr-09

Apr-10

Apr-11

Key Metrics & the Challenge

Key Metrics
1 Application to Condition Turnaround Times

December, 2010
4 days for clean 10 days for others

Application to Formal Turnaround Times

13 days for clean 18 days for others

3 4 5

Average Speed of Answer Solicitor Reworks Throughout

71 seconds 11.2% 0.46 decisions per hour

14.57 decisions per FTE

6 7 8 Handoffs Training Engagement 19 per application 118% of budget 52%

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Changes Implemented

1. 2. 3.

Customer centric approach to processing mortgage applications. Improved communication to Distributors Segregated staff into logical process steps and then introduced cross skilling. Reduced duplication between a Customer Service Officer and Credit, and rationalise the notes required for internal assessment Reduced internal hand-offs. Centralised function for Brokers Calls.

4.

5. 6.

7.

Provided internal reporting to reduce the RMI (request for more information) rate.

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Key Changes

Key Metrics
1 Application to Condition Turnaround Times

December, 2010
4 days for clean 10 days for others

December, 2011
2 days for clean 9 days for others 8 days for clean 14 days for others 36 seconds 3.3% 0.84 decisions per hour

Application to Formal Turnaround Times

13 days for clean 18 days for others

3 4 5

Average Speed of Answer Solicitor Reworks Throughout

71 seconds 11.2% 0.46 decisions per hour

14.57 decisions per FTE

6 7 8 Handoffs Training Engagement 19 per application 118% of budget 52%

26.77 decisions per FTE

12 per application 516% of budget 72%

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Questions

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