COMSATS Institute of Information Technology

COMSATS Institute of Information Technology, Lahore

Allied Bank of Pakistan, Multan Cantt. Branch, Multan

Advisor
Madam Sarosh Haneef

Presented by
Muhammad Asad Amin CIIT/FA05-MBA-007/LHR

COMSATS INSTITUTE OF INFORMATION TECHNOLOGY, JINNAH CAMPUS DEFENCE ROAD OFF RAIWIND ROAD, LAHORE

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COMSATS Institute of Information Technology, Lahore

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DEDICATION
I dedicate my efforts to my parents who pray for me every minute, my brothers who guide me at every step of my life, my classmates and my group fellows who stand by me whenever I need them and to all those who help and encourage me whenever I find hurdles in my life.

COMSATS Institute of Information Technology, Lahore

ACKNOWLEDGEMENT I offer my humblest thanks to ALMIGHTY ALLAH, The most Beneficent and the Most Considerate and the entire source of all knowledge and wisdom. I thank ALMIGHTY, ALLAH, who gave me the aptitude to do this project efficiently and successfully . I faced a lot of difficulties during this period of developing internship report. But Allah gave me a lot of patience and due to the continuous encouragement of my teachers and other people concerned, I was able to complete this work. I offer my humblest respects to the HOLY PROPHET HAZRAT MUHAMMAD (Peace Be upon Him) who is, forever a torch of guidance and knowledge for humankind as a whole. It’s not very easy for me to find the right words to express my gratefulness to our praiseworthy advisor Madam Sarosh Haneef, her enthusiastic interest, in time and useful suggestions, continuous encouragement, vivacious supervision and kind behavior throughout my internship period.

Apart from my respectable advisor, there are many other people who have been very helpful to me right from the beginning .I’d like to mention Mr. Akhlaq Ahmad Siddiqui, Manager ABL Multan Cantt., Mr. Abdul Sattar, Head of Online Section ABL Multan Cantt, Mr. Aziz Ahmad Khan, AVP at ABL Regional Office Multan, Mr. Zia, EVP at ABL Regional Office Multan. I also pay my regard to all others whose names can not be included due to the scarcity of space and time. At the end I’d like to thank Mr. Muhammad Shakeel Asghar, my class fellow and my internship colleague as well, whose company was a cause of support and motivation, because without naming him this acknowledgement will be incomplete.

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TABLE of CONTENTS
Executive Summary Vision, Mission and Core Values History of Allied Bank of Pakistan Board of Directors Organizational Structure Competitive Strategy Business Process Analysis Learning as an Internee New Knowledge Acquired Problems Encountered How Experience Impacts My Career SWOT Analysis Recommendations
02 03 04 08 09 10 13 24 26 32 33 34 41

Executive Summary
My Internship at Allied Bank Limited Multan Cantt Branch started on July 20, 2006 and completed on August 30, 2006. During my stay at the bank I learnt a lot as the practical COMSATS Institute of Information Technology, Lahore 3

knowledge of the banking sector is concerned. I was rotated in different departments including clearing, online transfer, and customers’ services foreign exchange and advances departments. I learnt the basics of operations performed in each department. I undertook some assignments that helped me apply the learnt techniques. I faced some problems during this course, but I got full attention from the concerned persons and they always encouraged me for asking any kind of question that rose during the course of my work. I have been sending the reports of my progress on weekly basis to my internship advisor. On the last day, the manager gave his comments and evaluation of my work on the prescribed form provided by the institute and also certificate of internship.

Vision, Mission & Values
Vision • To become a dynamic and efficient bank providing integrated solutions

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In order to be the first choice bank for the customers. Values • • • • Integrity Excellence in service High performance Innovation and growth

Mission • • To provide value added services to our customers To provide high tech innovative solutions to meet customers requirements. • To create sustainable value through growth, efficiency and diversity for all stakeholders • To provide a challenging work environment and reward dedicated team members according to their abilities and performance • To play a proactive role in contributing towards the society

History of Allied Bank of Pakistan
ABL was established in Lahore before independence in 1942 Allied Bank Limited is one of the largest banks in Pakistan with more than 700 Branches connected to an online

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network. In August 2004 the Bank was restructured and the ownership was transferred to Ibrahim Group. Overview Allied Bank is the first Muslim bank to have been established on the territory that became Pakistan. The bank has seen many phases of changes since it came into being. Established in December 1918 with the name “Australasia Bank” at Lahore with a paidup share capital of Rs. 0.12 million under the Chairmanship of Khawaja Bashir Bux, the Bank had attracted deposits equivalent to Rs. 0.431 million in its first eighteen months of business. Total assets then amounted to Rs. 0.572 million. Today Allied Bank's paid up Capital & Reserves amount to Rs. 10.5 billion, deposits exceed Rs. 143 billion and total assets equal Rs. 170 billion. The Allied Bank's story is one of dedication, commitment to professionalism, adaptation to changing environment resulting into all round growth and stability, envied by many.

The Pre Freedom History In the early 1940s the Muslim community was beginning to realize the need for the active participation in the field of trade and industry. The Hindus had since the late 1880s established a commanding presence in industry, trade and commerce in the undivided Sub-continent. Banking, in particular, was an exclusive enclave of the Hindus and it was widely believed, and wrongly so, that Muslims were temperamentally unsuited for this profession. It was particularly a hard thing to swallow for Khawaka Bashir Bux to hear that “Muslims could not be successful bankers”. He decided to respond to the challenge and took lead in establishing this first Muslim bank on the soil of Punjab that was to become Pakistan in December 1918; by the name of Australasia Bank Limited.

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The initial equity of the Bank amounted to Rs 0.12 million, which was raised to Rs 0.5 million by the end of first full year of operation, and by the end of 30th June 1947 capital increased to Rs. 0.673 million and deposits raised to Rs 7.728 million. Australasia Bank Australasia Bank was the only fully functional Muslim Bank on Pakistan territory on August 14, 1947.It was severely hit by the riots in East Punjab. The bank was identified with the Pakistan Movement. At the time of independence all the branches in India, (Amritsar, Batala, Jalandhar, Ludhaina, Delhi and Agra) were closed down. New Branches were opened in Karachi, Rawalpindi, Peshawar, Sialkot, Sargodha, Jhang, Gujranwala and Kasur. Later its network spread to Multan & Quetta. The Bank financed trade in cloth and food grains and thus played an important role in maintaining consumer supplies during riot affected early months of 1948. Despite the difficult conditions prevailing and the substantial set back in the Bank’s business in India, Australasia Bank made a profit of Rs 50,000 during 1947-48. By the end of 1970 it had 101 branches. Unfortunately it lost 51 branches in the separation of East Pakistan. The bank did well despite losing lot of its assets. By the end of 1973 the bank had 186 branches in West Pakistan. Allied Bank (1974 to 1991) In 1974, the Board of Directors of Australasia Bank was dissolved and with the union of Lahore Commercial Bank and Sarhad Bank it was renamed as Allied Bank. The first year was highly successful one: profit exceeded the Rs 10 million mark; deposits rose by over 50 percent and approached Rs 1460 million. Investments rose by 72 percent and advances exceeded Rs 1080 million for the first time in bank history. 116 new branches were opened during 1974 and the Bank started participation in the spot procurement agriculture program of the Government. Those seventeen years of the Bank saw a rapid growth. Branches increased from 353 in 1974 to 748 in 1991.

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Deposits rose from Rs 1.46 billion, and Advances and investments from Rs 1.34 billion to Rs 22 billion during this period. It also opened three branches in UK. Allied Bank (1991 to 2004) As a result of privatization in September 1991, Allied Bank entered in a new phase of its history, as the world’s first bank to be owned and managed by its employees. In 1993 the “First Allied Bank Modaraba (FABM)” was floated. After privatization, Allied Bank registered an unprecedented growth to become one of the premier financial institutions of Pakistan. Allied Bank’s capital and reserves were Rs. 1.525 (Billion), assets amounted to Rs. 87.536 (Billion) and deposits were Rs 76.038 (Billion). Allied Bank enjoyed an enviable position in the financial sector of Pakistan and was recognized as one of the best amongst the major banks of the country. In August 2004 as a result of capital reconstruction, the Bank’s ownership was transferred to a consortium comprising Ibrahim Leasing Limited and Ibrahim Group. Today the Bank stands on a solid foundation of over 88 years of its existence having a strong equity, assets and deposits base offering universal banking services with higher focus on retail banking. The bank has the largest network of online branches in Pakistan and offers various technology-based products and services to its diversified clientele through its network of more than 700 branches. 2005 to Onward In May 2005 Ibrahim Leasing Limited (ILL) was amalgamated and vested in Allied Bank Limited. ILL shareholders were issued ABL shares in lieu of the ILL shares held by them. Application for the listing of ABL shares in all the Stock Exchange Companies of Pakistan was made. ABL was formally listed and trading of the shares of the Bank commenced W.E.F. the following dates.

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Islamabad Stock Exchange Lahore Stock Exchange Karachi, Stock Exchange free will.

8th August 2005 10th August 2005 17th August 2005

Now all shareholders of Allied Bank Limited can trade in the shares of the Bank at their

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BOARD OF DIRECTORS
Mr. Mohammad Naeem Mukhtar Chairman

Mr. Sheikh Mukhtar Ahmed Director

Mr. Mohammad Waseem Mukhtar Director

Mr. Sheikh Jalees Ahmed Mrs. Director

Nazrat

Bashir

Government Nominee Director

Mr.

Abdul

Aziz

Khan

Mr.

Farrakh

Qayyum

Director

Government Nominee Director

Mr. President & CEO

Khalid CHAIRMAN

A.

Sherwani

CHIEF EXECUTIVE OFFICER (CEO)/PRESIDENT

Organizational Chart
SENIOR EXECUTIVE VICE PRESIDENT (SEVP)

COMSATS Institute of Information Technology, Lahore SENIOR VICE PRESIDENT (SVP)

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EXECUTIVE VICE PRESIDENT (EVP)

ASSISTANT VICE PRESIDENT (AVP)

OFFICERS GROUP (OG1, OG2, OG3)

SUPPORTING STAFF

COMPETITIVE STRATEGY
Allied Bank strongly believes that the customers can be attained and retained only by providing them the services they want. Allied bank’s competitive strategies are focused on making their existing customers loyal because they believe that it is their existing COMSATS Institute of Information Technology, Lahore 11

customers who attract new customers. Allied Bank uses KYC (Know your customer) forms to have complete acquaintance with their new customers. TARGET MARKET Allied Bank’s main focus is not on the retail banking but on the corporate banking rather. In the retail banking they target salaried individuals, housewives, retired individuals and anyone who has the potential of providing legal deposits to the bank. Corporate customers being the main target of the bank get handsome packages of loan and other financial services. The bank’s main source of revenue earning is also the corporate sector customers. VARIETY in PRODUCTS Allied bank has skillfully crafted their products to use them as their core competencies and also as their tools for competitive strategy. The products include Agricultural Finance, Import Export Business/Trade Finance, Running Finance, and Demand Finance. These products serve multiple purposes to bank. SERVICES as COMPETITIVE TOOLS Same is the case with the services offered by Allied Bank. Services are the main tool through which the bank acquires new customers and retain them. These services are not merely ment to earn profit, but also to keep pace with the changing needs of the customers and modern day’s banking trends. These services include Home Remittances, Remittances, Hajj Services, Utility Bills, Lockers and Commodity Operations. Along with these core services provided by the bank, online banking and Internet banking serve as supplementary services. These products and services are mainly directed towards customer satisfaction and ABL uses it for the customer satisfaction as their competitive strategy. Some of the many benefits availed by the customers are mentioned as follow in bank’s own style.

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ONLINE FACILITY Now the bank gives you the absolute convenience of instant access to a host of banking facilities and personalized services 24 hours a day, 7 days a week, 365 days a year. Simplify the way you bank and experience a higher level of convenience. ONLINE FEATURES By Allied bank Online you can; 1Check your account balances 2Transfer funds between your own accounts and to a third party account 3You can use your card for loan account payments 4Check transaction history of your accounts 5Get your account statement through fax 6Receive information on various Allied bank products and services 7Find out status of your card or loan application 8Request balance or reference certificate 9Get currency exchange rates 10Issue stop payment instructions 11Report loss of your cheque book 12Request change in address and telephone numbers CONVENIENCE Why visit the bank when you can better use your precious time to meet other commitments? With ONLINE, our special discounted charges also offer you substantial savings. Give yourself the advantage of breakthrough innovation and cutting edge and get time on your side.

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TOLL FREE NUMBER Connect to Allied bank ONLINE by dialing from anywhere within Pakistan. Your call costs you nothing because it is toll free. This just goes to show that we at Allied bank always put your interests first. Dial now to discover just how Allied bank can make you’re banking experience even more enjoyable and rewarding. By offering all of the above ABL makes its way through the tough competition of the day. This helps the bank to keep pace with growing needs of its customers and anticipate their future needs and manage them accordingly in time thus to make sure that the quality is not compromised and the customers get what they want

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Business Process Analysis
PRODUCTS OF Allied bank Allied bank offers a wide range of products geared towards the customers. The following products are available for customers: • • • • • • • • Rupees Deposit Accounts Foreign Currency Accounts Allied Cash+ Card Online Banking Internet Banking Credit Card Advances/Financing Services

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ACCOUNTS
RUPEES DEPOSIT ACCOUNT The following accounts are the parts of rupee deposits accounts: • • • • Current Account Saving Account Allied Term Deposit Account Allied Monthly Income Scheme

CURRENT ACCOUNT Allied Bank offers Current Account facility for individuals as well as for institutions and commercial customers. There are free services for the depositors who maintain minimum balance of Rs. 0.1 (M) in previous month. BENEFITS • • • Free Online Transactions Free issuance of Payment Orders Free issuance of Demand Drafts

SAVING ACCOUNT Allied Bank offers PLS Savings Account facility to its customers with the following attractive features. • • Attractive return up to 5.00% per annum No service charges on active accounts 16

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Complementary ATM cards

For depositors maintaining a minimum balance of Rs. 0.5 (M) in the previous month. BENEFITS • • • • Free Online Transactions Free issuance of Payment Orders Free issuance of Demand Drafts Free Issuance of Deposit at Call Receipts

ALLIED TERM DEPOSIT ACCOUNT Allied Term Deposit Account is a profit bearing checking account with the payment of profit on a fixed term basis. The estimated rate of profit is given below. Rs 0.5(M) to less than Rs 1 (M) Rs 1 (M) to less than Rs 5 (M) Rs 5(M) & above SALIENT FEATURES • • • The applicable profit rate would be based on slab of amounts maintained on average term basis There is no restriction for maintenance of any minimum balance in the account Individuals, Companies, Schools, Hospitals, Charitable Organization etc, are free to open their account in this scheme 6.50% 7.50% 8.00%

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ALLIED MONTHLY INCOME SCHEME Allied Monthly Income Scheme is a unique product with attractive returns. It provides an opportunity for a regular monthly income. The period of deposit under this scheme is 3 years. • • • • • Minimum Amount Profit Projected profit rates 10.20% per annum Eligibility Period All individuals & institutions other than Financial Institutions 3 years Rs 100,000 (with increments of Rs 10,000/-) Payable on monthly basis Rs 850 per month on a deposit of Rs 100,000/- @

SPECIAL BENEFITS The Scheme Provides The Following Special Benefits: • • • • • Complementary ATM card for depositor and spouse Profit to be credited in the depositor’s PLS saving A/C and can be withdrawn through ATM free of charge Complementary credit card with approved credit limit Free transfer of monthly profit to any branch of ABL all over the Pakistan Loan facility against deposit

ADDITIONAL BENEFITS for DEPOSITORS of Rs 0.5 (MILLION) & ABOVE • • • • Free online transaction Free Issuance of Pay Orders Free Issuance of Demand Drafts Free Issuance of Deposit at Call Receipts

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Allied Cash+ CARD Allied Bank ATM Card, also referred to as "Allied Cash+", can also be used as a debit card at merchant locations/service outlets having ORIX POS Terminals and displaying the ORIX logo. ONLINE BANKING Allied Online is a unique service offering by Allied Bank Limited. Through Allied Online, your account is available to you from any of our branch countrywide. No matter where you are in the country and in which branch your account is maintained, you can have your cheque encashed at any of our over 735 branches located in 250 cities. Similarly account-to-account Funds Transfer facility is also available for instant remittance. Other services available to accountholders are Balance Enquiry and Account Statement at remote branches. Allied Online provides a secure, efficient and convenient facility for making payments to beneficiary accounts from any of our branches countrywide. Corporate customers requiring funds collection or disbursement facility can use it for cash management services. INTERNET BANKING Banking at consumer fingertips! Allied Direct Internet Banking offers the customers convenience to manage and control his banking and finances - when he wants, where he wants! It's Simple, Convenient, Secure and Faster. So, just by clicking one can enjoy this facility. Features of Allied Direct • Simple and Convenient Easier navigation and help provided at every step, so the customers can have most out of this service. With Allied Direct convenience is just a click away.

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Secure and Faster Secured & encrypted with latest tools and technologies, Allied Direct is the choice for secure and fast Internet Banking.

24x7 Access The customers now have access to your account 24 hours a day, 7 days a eek. They can transfer funds or even pay bills even if it's a holiday.

To use Allied Direct Internet Banking, consumers should be a registered Allied Bank Account holder with a valid ATM Card. If some one does not have an account, he may visit any of the nearest branch and open his account and obtain an ATM Card. Our friendly branch staff will help him open his account quickly. CREDIT CARDS The customer can now become the holder of a true Credit Card here in Pakistan. Allied Bank under license from Master Card International, U.S.A issues it's Master Card to anyone meeting the eligibility criteria. With the Allied Bank - Master Card the consumers will be assured of a service meeting the highest international standards maintained by Master Card. THE NEW ALLIED BANK-MASTER CARD Allied Bank is of the view that the time has come to bring about a radical change in the Pakistani credit card industry. Being a successful individual, customer deserves a life unrestricted by cash limitations, he deserves a reliable credit line, deserves the best. Luxury, status, prestige and convenience await him with the Allied Bank-MasterCard - at no extra cost. That’s why the Allied Bank-MasterCard is now available for customers – with a set of unique features, a simple application procedure and the fastest processing time! Accepted at 16,000+ establishments in Pakistan and over 17 million retailers across the world, the Allied Bank-Master Card is the ticket to financial independence.

ADVANCES/CREDIT DEPARTMENT

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SEASONAL FINANCE Seasonal Finance facility is allowed against pledge of produced Crops harvested in that particular crop season. The delivery of pledged stocks/goods is made against appropriate cash payment. AGRICULTURAL FINANCE Bank under Agricultural Financing Scheme envisaged by the State Bank Of Pakistan extends short, medium and long term, farm and non-farm credits. The farm credits are extended for production (inputs) and development purposes. Non-farm credits are allowed for livestock (goats, sheep and cattle), poultry, factory including social forestry and fisheries (inland and marine excluding deep sea fishing). TRADE FINANCE Allied Bank provides highly efficient trade finance services for import/export business to his clients through large number of authorized branches where trained and motivated staff is available to handle the business on behalf of customer. RUNNING FINANCE It is a short-term loan allowed by the bank for a period of one year. The running finance account can be operated on daily basis. The mark-up is recovered on the products of daily outstanding balance. The running finance is suitable for meeting day-to-day financial needs of the business DEMAND FINANCE It is disbursed in lump sum or in accordance with the agreed disbursement schedule and it is repayable as per the agreed installments, which could be monthly, quarterly, biannual or annual.

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CORPORATE FINANCE Allied Bank Limited commenced lease operations upon amalgamation with Ibrahim Leasing Limited. Facilities include leasing for machinery, commercial vehicles and equipments. The Bank provides lease facilities for balancing, modernization, replacement and expansion schemes to corporate and commercial clients in all industrial enterprises. Leasing is a popular mode of financing due to its distinctive features like tax shield, preserve working capital, easy documentation and less processing time. Lease applications are entertained at all Bank branches in Pakistan.

SERVICES
Any one can rely on Allied banks friendly staff that is eager to assist their customers as best as possible. Allied Bank offers the following services to its customers: Remittances • • • • • • • Hajj Services Utility Bills Lockers Remittances 1-Link ATM Business Account Foreign Currency Account

UTILITY BILLS All branches of the Bank collect utility bills of electricity, gas and telephones. For convenience of the customers, the branches collect Utility Bills during banking hours and also in the evening banking on all working days. Bills can be paid through Cash or

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Cheques. Consumers may drop bills with crossed Cheques into a drop box available at the branches under "Cheque Drop-in" system. Utility Bill payment facility – can also be availed through any of the ATMs without having to wait in long queues outside the branch. REMITTANCES Allied Bank can transfer funds to the remote part of the country for payment/credit to the customer himself or a third party, through Telegram/Telex/Tele fax for payment/credit on the same/next day. Telegraphic transfers can also be made abroad in Foreign Currency

HAJJ SERVICES The Bank serves the intending pilgrims by helping them in performing this religious obligation. The bank provides the forms and other related services. However, the terms and conditions for accepting the Hajj forms from intending pilgrims are in accordance with the Hajj Policy announced by the government, each year. Hajj applications are available with all branches during Hajj season, immediately after the Government of Pakistan announces the Hajj policy LOCKERS Allied Bank Lockers are available in three different sizes Small, Medium and Large on a yearly fee. Locker holders need not have an account in the Bank. SET-UP of ATM Allied Bank has vast network of ATM's presently consisting of 100 ATM's installed in over 40 cities which is undergoing expansion.

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In addition, Allied Bank has a member of 1-LINK ATM sharing switch comprising of over 600 ATM's nationwide. Consequently, the Bank's ATM cardholders can avail services of Allied Bank's own or 1-LINK ATM's. LINK NETWORK In continuation of ALL TIME BANKING services, with the country wide network of 735 branches, ABL has enhanced ATM services by joining the "1-Link Switch" which has following member Banks: • • • • • • • • • • • • ABN Amro Bank Allied Bank Bank Alfalah Habib Bank Limited Askari Bank Bank Al Habib National Bank PICIC Commercial Bank Union Bank United Bank Soneri Bank Meezan Bank

The cardholders of our bank will thus be able to access member banks ATMs for balance inquiry and cash withdrawal simultaneously. The cardholder's member banks will access our bank ATMs.

BUSINESS ACCOUNT
It’s the easiest current account, which gives the facility to businessman to have transaction there where his business takes him. Business Account presents you the COMSATS Institute of Information Technology, Lahore 24

safe way to transact amount because of which the businessman have no problem to take cash and travelers cheques with him. EASY TO DEPOSIT AND WITHDRAW Because of online real time technology all over Pakistan, the clients can easily deposit or withdraw money from any of the branch of ABL. PAY ORDER AND DEMAND DRAFT In Pakistan where ever the customer is, business account holder can easily get the pay order and demand draft from any of the Allied Bank branch.

CLEARING PROCEDURE Because of online real time technology cheques process, and funds transfer work so fast that it never happened before. ACCOUNT INFORMATION Wherever the customer is in Pakistan, he can get any information about his account. The information may be about accounts balance and account statements. FOREIGN CURRENCY ACCOUNTS Allied bank deals in following foreign currencies. • • • US Dollars Great Britain Pound Euro

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Japanese Yen

Learning as an internee
DUTIES and ACCOMPLISHMENTS My duties at the bank during my internship were of the diversified nature. I was rotated in the different departments of the bank. I was also assigned with some responsibilities of the minor level. They gave me some assignments as well to give me the true exposure of practical work environment. So my duties can be categorized department wise as under: CLEARING DEPARTMENT In this department I spent about 3-4 days. I observed the procedure carried down here. Based on my observation and briefing from the staff I was asked to prepare advices for collection of demand draft amount, Outward Bill for Collection (OBC), fill in the deposit slips presented by the customers, enter the proceedings in concerned registers.

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ONLINE FACILITY PROVIDER DEPARTMENT Online banking is a wide spreading concept in banking sector. This department mainly performs the basic operation of fund transfer and other functions facilitating the transfer and enquiries. I observed the basics of the department. I didn’t have the opportunity to seek the details because the online department is a sensitive area and also electronic based. I prepared online transfer slips foe the customers. I also informed the customers of their account balance, account status and about other queries available online.

CUSTOMER CARE DEPARTMENT This department serves as the front representative of the bank. Multiple tasks are executed in this department. I was asked to observe different complaints received by the bank by its customers. I maintained the sundry account register, suspense account register. I put the applications received for the ATM cards in the register. I also had to maintain the register maintained to record the receipt of new account opening forms along with the register kept for recording those ATM cards, which have been delivered. FOREIGN EXCHANGE DEPARTMENT This is the department with a very vast scope and a variety of dimensions. There, I had to maintain the record of some Letters of Credit (LCs). I was liable for making drafts of outgoing SWIFT messages. I also made the entries of incoming SWIFT messages in the register. I was asked to enter the particulars of I-form (Import form) and E-form (Export form) in their respective registers. COMSATS Institute of Information Technology, Lahore 27

ADVANCES AND CREDIT DEPARTMENT In this department I was given some files to study, which were about the applications of credit to be approved. The person in charge of there briefed me about the term and conditions on which the bank accepts or rejects an application foe the credit. In this department, like the online department, I didn’t have an opportunity to practically handle the work due to the sensitive nature of the work. DIVERSE DUTIES Apart from the duties mentioned above, I had to perform some other duties as well. The prominent amongst them is called “Calling” in the banking jargon. It’s manual checking of the record produced by the computer pertaining encashment, transfer and collection of cheques and other instruments like deposit slips and online slips. I had to work with the person responsible of keeping the record of DD payable. I was assigned with the duty of keeping the record of DD payable of a given period.

NEW KNOWLEDGE ACQUIRED
CHEQUE BOOK ISSUING PROCESS If some one opens a new account and become the client of the Allied bank of certain branch then he gets the requisition slip on which cheque book is issued Normally people use two types of accounts 1Current Account 2Profit and loss account or PLS Account 3Term Deposit Account • • • Current account cheque book has 50 leaves and it cost RS.100 Profit and loss account or PLS account cheque book has 25 leaves and it cost RS.125 Term deposit account cheque book has also 25 leaves and it also cost RS.50 28

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In every cheque book there is also a requisition slip available for the purpose of reissue of a cheque book, if the first cheque book has no more leaves. There is written the title of account holder, his account number, the stamp of Allied bank and the signatures of the authorized person on every page of cheque book and also on the requisition slip. CLEARING AND COLLECTION There are two types of clearing/collection cheques 1Inward clearing/collection 2Outward clearing/collection

OBCs
CLEARING CHEQUES This department receives the cheques and other negotiable instruments drawn on local branches of other banks. NIFT has a clearing house, in which cheques and other negotiable instruments are brought by each local bank representative and the claims of each bank on other is offset and a settlement is made by the payment of difference. Clearing system is helpful for both the customers and bank in saving money, time and labour. PROCEDURES The cheques and drafts come to branch from different banks. They enter the particulars of the cheques on a register. After this process the balance with total drafts and total amount are given to the representative. ABL works under the rules and regulations prescribed byf State Bank of Pakistan (SBP) and has an account with SBP. The clearinghouse of SBP (NIFT), through whom branches forward/receive-clearing cheques along with a schedule conducts clearing. The clerk of forwarding branch

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prepares the schedule and vouchers of all the clearing cheques, which he receives by the clerk on that day and sends these cheques to the checking officer. Checking officer passes these cheques and vouchers by his initials, endorsement stamp and branch special crossing stamp. Clerk posts the contra entries of these vouchers in the clearing register. Representatives’ banks collect these cheques. Next day at 8:30 A.M. representatives of all local banks and foreign banks exchange their cheques, which are drawn on their banks. The clearinghouse debits/credits the payee/receipt branch with the total amount of the cheques paid on their behalf. The settlement of book entries e.g., if ABL is to give Rs. 2 Million to UBL and UBL has to give Rs.1 million to ABL then ABL will draw a cheque of 1 Million in favour of UBL. SBP will debit this amount from ABL account and credit of UBL account. In this way mutual cross debiting and crediting in the books of SBP settle obligation of banks. PAK ACCOUNT All the inter-bank adjustments will be affected through head office account called Pak account. It will be essential for the branch to advise pak account of each transaction so that they may also pass the necessary entries in their books. The NIFT will send a consolidated debit/credit advice to the branches in respect of clearing cheques delivered to or received from the branches. The amount of the advice will agree with the total amount appearing in the schedule of cheque delivered/received. The head office will similarly send advice to the branches of the returns, if any. Copies of all advices will be sent to the head office. INTER-BRANCH CLEARING AND COLLECTION Branch receives the cheques and other negotiable instrument drawn on other branches of the same bank. Main branch of ABL handles the transfer and delivery of cheques. The same clearing cheque procedure will be adopted in the transfer deliveries except in case when the facility of SBP is not availed. In case of cheques drawn on one branch

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and collected by an other branch for the credit of its constituents, the branch delivering the cheques will send a consolidated debit advice. If any cheque is returned unpaid, a credit advice will be sent to the branch returning the cheque. COLLECTION CHEQUES OR OBCs The collection cheques/OBCs are the cheques, which we have cleared for our customers when some of our customers receive the cheque that is of some other city. These types of cheques are known as collection cheques or the other name we gave them is OBC PROCEDURE OF COLLECTION On the cheque there is written that the person to whom it may concern can cash it from the certain branch of the bank in favour of which it’s drawn. The customer presents the cheque to his branch, which send a document called “OBC” to the bank that has to make the payment. The clearing department of the receiving bank follows a prescribed procedure and credits the amount to sending bank through a central account maintained by each bank with SBP. ABL sends the cheque to it’s own branch if available for collection from the payer’s bank otherwise the OBC is directly sent to other bank. MAINTAINING REGISTER for OBCs We have a register in which we have the serial no for OBCs with other details like amount, date, sending and receiving branches’ codes. Every OBC is entered in that register on daily basis. If OBC is not cleared due to what ever fault, we take it back as a return but after that we call the concerned person and we also write name of the person.

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ACCOUNT OPENING I learnt how to open a new account. The person willing to open an account has to complete the account opening forms, which has several particulars pertaining to personal information of the person. The bank makes sure that all the information provided by the person is authentic. Along with the information given by the person himself, bank requires introduction of an already existing account holder of the same bank but preferably of the same branch. The bank also requires account no. and copy of the introducer’s NIC. Bank also requires a copy of the NIC from account opening person. He will also have to provide two samples of his specimen signatures for any withdrawal of amount. In case of illiterate person, he will provide the bank with his left thumb impression along with two photographs. In case of a Pardah Observing lady, the bank prefers not to open an account but if so, it will require her to provide impressions of her both thumbs. After all this formality, the bank after a few days sends a letter of thanks to the address of the person disclosed in the AOF. When the letter is received, the person may come to bank and collect his cheque book.

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The bank also informs its head office about the new accounts and also charges nominal amount at first time. MATTER of ZAKAAT The deductions of Zakaat from the account of Muslims are made on the 1st Ramadan according to the Islamic rate. But the people who do not want the bank to deduct Zakaat and want to disburse it at their own, they have to provide an affidavit on a prescribed format provided by the bank.

ONLINE TRANSFER The department providing online facility to the customers, I liked the most. I learnt different procedures regarding this department. I learnt the process of online transfer. The whole this process need is filling of a slip, and cheque or cash. In the slip the name of remote branch and account number of the remote person must be entered. If the person is not an account holder of the bank then he has to attach his NIC copy with the slip for his identification. The person availing this facility submits the cash on the cash counter and then gives the slip to the host person at the department, who then enters the data in the computer. In this way the money is transferred to an account through PAK account, which is the central account of the bank and all the inter branch transactions has to go through this process. LEARNINGS in FOREIGN EXCHANGE and ADVANCES DEPARTMENT As an internee I learnt many things some of which I have described above. The remaining few include the processes involved in the foreign exchange and advances department. Now a day, both of these departments are considered to be the backbone of any bank. Foreign exchange department brings foreign reserves. Mostly import and export business takes place through foreign exchange department.

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Advances/Credit department is equally important. This department gives the bank a real business. The bank gives money to the borrowers on interest and earns a lot in this way. The bank lends money against some guarantee or pledges some property for this purpose. So that in case the customer cannot pay back money, the bank can meet over come its expenditures.

PROBLEMS ENCOUNTERED
NEW ENVIRONMENT Initially I had difficult time in mixing with organization members and felt uncomfortable in that new place with new people. However, after some time, I became a part of it just like everyone else and felt completely comfortable. The other major problem was the hectic routine of the bank. It made me uneasy at first but with the passage of time I became used it. I had to face a great difficulty in understanding bank’s terminology by the knowledgeable guidance of the staff I was able to overcome the problem to a satisfactory level. The real problem I faced in the bank was the difference between what I had learnt from the books and what was being practiced. Practical application of the theories learnt during academic sessions was a great challenge, which I overcame by the cooperation of the staff.

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HOW EXPERIENCE IMPACTS MY CAREER
My internship experience has given me a realistic preview of practical life. Now I feel that I am better prepared to enter the world of professional work. I have come to know and been appreciated by a number of professionals who are lending their services to the banking sector for more than a decade. I feel honored that I have worked with such experienced professionals. I must admit that such interaction in this respectable professional community will help me in seeking out good job opportunities in the near future. Each task I performed was a different experience in itself. By the end of it, I must say I realize my potentials, I have realized that practical life is not so easy after all, it takes a lot of hard work and devotion, and not to forget time. And I now know that if I want I can make things possible, and I also know how good it feels to having accomplished something and being appreciated for it. I definitely have learnt things, which will impact my career and my character. The overall experience of my internship was very good; I have learnt the sense of responsibility in its literal meaning. I am now capable of dealing with different sort of customers, and how to be patient while doing so. Besides this I also gained knowledge about banking which I previously lacked and many more products being offered by the bank. So in a nutshell, this internship gave me the experience, which would no doubt boost my confidence to work in future.

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SWOT Analysis
SWOT is the abbreviation of four words these are “S” stands for strength “W” stand for weaknesses “O” stands for opportunities and “T” stand for threats. Strength and weaknesses are the internal factors of the organization and these are also known as the micro factors but the opportunities and threats are the external factors and these are known as the macro factors. Micro factors are the controllable factors but the macro factors are uncontrollable. Whenever the organizations come into a form, they have to know about their strength and weaknesses. Then they have to find out their opportunities and then they come to know about their threats but according to the latest theory the word SWOT is know as WOTS. According to this theory, first of all the organizations know their weaknesses, then they get knowledge of their opportunities that they have in the particular sector and then they have come to know about their competitors and at the last they think about their strengths. The easiest way to know about any organization is the SWOT analysis. So to reveal the hidden factors I did a SWOT analysis of the Allied bank. It is not the SWOT analysis of ABL as a whole but only of the branch where I worked. Many aspects are same almost in every branch of the Allied bank.

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STRENGTHS
LARGE NUMBER OF BRANCHES Allied bank has maximum number of branches in all over Pakistan. It has more than 735 branches connected to each other through an online network and most of the branches are working at the main business points. VARIETY in PRODUCTS Allied Bank has many products for almost all type of customers. So, it depends on the customer that which product he likes and in which sector he wants to invest depending on whether a person is salaried one or a businessman. It also gives the companies the facilities of collection accounts. ATM and Credit cards, online transfer, DD, TT, Rupee Traveler cheques are the main products available for customers. ONLINE FACILITY Allied bank is providing the facility of online banking. This facility allows a customer to send or deposit money through cash or a cheques to an account of any other branch of ABL. It also gives the facility of balance inquiry and cash with drawl from a certain account of any other branch of ABL through cheques. SECURE BANKING The online banking feature provides less chances of fraud. Because whenever some transactions take place, they can be checked any time and their receipts are receipts COMSATS Institute of Information Technology, Lahore 37

are given to the customers. Moreover, to prevent illegal acts, the person who transfers any amount submits his copy of NIC to the bank.

LOCKERS FACILITY Many banks provide the facility of lockers but not in their all branches but Allied bank is the only bank that provides the lockers facility to their customers at their all branches. CUSTOMER CARE CENTER Allied bank has customer care center for its customers. They have toll free numbers on which customers can dial and they have not to pay any thing for it. This center also provides the facility to the customers on spot and helps them whatever the matter is. FOREIGN EXCHANGE Allied bank provides the facility of foreign exchange to its customer. The customers may also open their accounts in foreign currency. The bank provides the facility of letter of credit and other export/import facilities to its customers. The customers may get the facility of money exchange on the current rates. To get the latest rates, the head office provides them with the fax facility of daily rates of foreign currency.

SAME ACCOUNT NUMBER FACILITY At Allied bank the customers the person who has more than one account can have the facility of the same account number only the suffix is changed. This facility provides the customer with easy remembering of the account number.

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PAID LEAVES For employees the relaxation is that the employees may get the 36 medical leaves and 1-month vacation in one year with their pay in case of some emergency. SECURE ENVIRONMENT Cameras are installed in all the branches of the bank to ensure security of its customers and employees. Also security guards are available through out the day. Cameras are installed in front of the cash counters. These cameras are switched on all the time. The branch manager can see all the activities while sitting in his office on a display monitor. If some thing goes wrong then the manager can buzz the security alarm immediately. ACCOUNT OPENING an EASY PROCESS At Allied bank it’s very easy to open an account just an introducer and a copy of NIC is required. Customer just needs to fill up account opening forms and can enjoy the facilities of any type of account the want. This is the strength of Allied bank facilitates all of its customers. EMPLOYEES’ REPLACEMENT In every branch of Allied bank the back up of every employee is there in case of emergency if some officer is not available at the bank, some other person will back him up. That person is always well familiar with the responsibilities of that officer. LOW RATE OF INTEREST Allied bank offers loans to its customers on very low rates. This thing invites the customers to do a business with ABL.

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SUPPORTIVE ENVIRONMENT The staff of the ABL is very much cooperative. This thing enhances its performance very much by facilitating its customers and also by helping colleagues and sharing workload.

WEAKNESSES
INCENTIVE SYSTEM Most of the staff in the Allied Bank is not completely satisfied with the inducements. This dissatisfaction sometimes leads to less motivated employees in banking which in turn can effect its business efficiency. Moreover, permanent staff is not given any performance related incentives. As a result of this, an inefficient manager or employee is earning the same as an efficient employee who is the real asset for the organization INCREMENT IN WORKFORCE’S PAY The other main weakness of the Allied bank is that there are mostly no annual increments to their employees’ salary. This thing leads to the dissatisfaction of employees. LATE PROMOTIONS The other thing that for the employee’s point of view is a weakness in Allied bank is that the employees are promoted after a big period against the schedules specified by the bank. LOW PRODUCT CREDIBILITY Allied Bank has still not got the edge where the consumers become loyal to its products and services. Mostly customers become its customers out of no reason than request from a personal banker. And talking about consumer banking, though credit cards COMSATS Institute of Information Technology, Lahore 40

awareness in our middle class society has gradually improved but not up to the point where they can compare the features that one Bank is offering and other is not. Truth must be said, most customers do not even know the points behind the term “interest free days”. The point is, consumers do not know of the product being offered so how can they rely on the product.

OPPORTUNITIES
The Allied Bank is having a great opportunity to emerge as the best bank of the country by giving best possible services to its customers. The banking sector is improving day by day and consumer banking is making great revolutions in the banking sector. Allied Bank is still working in the corporate sector and it’s missing a big market share of consumer banking. If it enters this market then this bank can become the biggest and the most efficient bank of Pakistan.

THREATS
COMPETITORS Allied Bank has the threats from their competitors in the banking sector, from the Govt. policies and from the current economic conditions of the country: The main competitors in the banking sector are the Bank-Alfalah, Faysal Bank, Muslim Commercial Bank, Prime Commercial Bank etc Due to the tough competition the bank is forced to sanction the loans at the reduced rates and other services at minimized cost This reduces the profit margin which is a big hurdle in the way of innovation and extended customer services. GOVERNMENT POLICIES Other threat which ABL: faces is the policies of the government. Tax charged on the income of banking companies is much higher than on the income of other companies. The strict regulations issued by the central bank, revenue authorities and other COMSATS Institute of Information Technology, Lahore 41

concerned authorities are also a big threat to the bank. The Govt. revises the tax policies on continuous basis, which often are not in the interest of the industry including the banking sector.

POLITICAL CIRCUMSTANCES Political conditions in Pakistan have been unstable since a very long period. Continuous changes of regimes in the political affairs are great threat towards the healthy growth of the whole industry. TRADE and INDUSTRY CONDITIONS Sudden rise and fall in the trade and industry conditions and stock exchange business of the country also adversely affect the growth of banking sector. Unemployment, unfavorable balance of trade, decreased per capita income; inflation and deflation, recession and boom are the source to the handicapped progress of banking sector. POLICIES of ABL Another threat to the bank’s progress is its own policy. Bank is not concentrating on improving its overall process. There is still lack of highly qualified staff in the bank. And the employees are given promotions on reference basis, which causes frustration among employees and overall graph of the performance comes down. So ABL should reconsider their policies so that the bank may remain in the race.

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RECOMMENDATINOS and SUGGESTIONS
During my stay at ABL, I tried to observe the environment profoundly. I found some problems that were creating problems in achieving targets and objectives • The bank is still depending on manual work to a great deal which causes slow performance and increases the chances of mistakes. It advantage over its competitors. • Approach towards employees is still bureaucratic and a lot is to be done in this regard. Late promotions, shortage of training and development facilities, favoritism in appraisals and lack of sufficient incentives are some problems that are arising dissatisfaction among employees. Due to this overall performance of the bank also decreases. • Outlook of the branch I worked for was not good enough. The bank working beside this branch was attracting more customers due to this factor also. In the new era this feature counts a lot to any organization. So the administration of the bank should think on this aspect also and make these conditions better. should convert their system to an automated one to better achieve its targets and also to take the

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