INTERNSHIP REPORT

well done keep it up good effort

BANK ALFALAH LIMITED

Student Name Student ID MBA (Finance) Session Date of preparation

VIRTUAL UNIVERSITY OF PAKISTAN (IIIT GUJRANWALA CAMPUS)

DEDICATION

This project is dedicated to my parents, love of whom has been a constant source of motivation for me.

ACKOWLEDGEMENT

First of all I t!ank Alla! Almig!t" for t!e #lessings !e !as #estowed upon me$ I would like to t!ank m" BI%&%'I(A& AND S)I*I+,A& )A*-N+S wit!out w!om I./e not #een w!at I.m$ I would like to t!ank Mr$ ,mair (Dean) and Mr$ Far!an (our coordinator) of interns!ip program for guiding me in preparation of t!is report$ I am grateful to t!e Mr$ S!eik! Masood -la!ee (Branc! Manager) of Bank Alfala!0 Mr$ Malik 1a/aid (Manager %perations) and t!e entire operations Department 2 Miss Maria 3!an ((*%) of Bank Alfala! for !elping and guiding me in a relentless manner during m" interns!ip at Bank Alfala!$ I also t!ankful to Miss Saira (Manager +rade) 2 Mr$ 4ama"oun *asool Mal!ee (Manager (redit)0 Miss 4ina also gi/e a greater knowledge a#out accounts department0 so I am also t!ankful to !er0 I am t!ankful to all t!ose indi/iduals w!o contri#uted for t!e completion of t!is pro5ect$

EXECUTIVE SUMMARY
Being a student of #usiness administration0 it.s /er" muc! necessar" to get t!e practical e7perience of an organi8ation and see t!e implementation of all t!at we !a/e studied in t!eor"$ 9!en I stepped in Alfala! to !a/e m" realit" #ite0 I wasn.t #lind of w!at I am going to !a/e$ I./e !eard man" people sa"ing t!at t!ese course #ooks contradict wit! t!e real scenario #ut I didn.t find an" gaps$ +!e organi8ation0 its procedures0 its processes0 t!e s"stem0 e/er"t!ing was predicta#l" sound$ +!e onl" enigma was t!e :people;0 as #ooks can.t pro/ide t!e e7pertise needed to deal wit! t!em0 its life t!at does< In )akistan0 t!e integration of t!e Banking and Finance Sector wit! t!e international finance communit" is a !ig! priorit" of t!e 'o/ernment to attract foreign in/estments in t!e de/elopment of t!e countr"=s econom"$ Interns!ip is in fact a glimpse of 5o# world and off course practical and professional life$ Interns!ip at Bank Alfala! pro/ided me an opportunit" to e7plore practical work in lig!t of w!at I !a/e studied during MBA$ M" SI> week working at Bank Alfala! &imited0 Main '+ *oad Branc!0 and 'u5ranwala was full of learning regarding /arious aspects of #anking$ +!is report contains practical knowledge0 w!ic! I gained during m" interns!ip$ Bank Alfala! limited is one of t!e largest pri/ate #anks in )akistan0 and due to #ank.s mo/ement on its pat! of strategic e7cellence wit! a special focus on ser/ice and /alue en!ancement it !as a /er" #rig!t future a!ead$ During past few "ears t!e positi/e and d"namic interpla" of political and economic factors translated into !ig!er performance for t!e Bank$ 9orking at BAN3 A&FA&A4 &IMI+-D is reall" a /er" toug! 5o#$ But t!e working en/ironment BAN3 A&FA&A4 &IMI+-D is mar/elous$ BAN3 A&FA&A4 &IMI+-D is a perfect e7ample of a moderni8ed #ank w!ere great emp!asis lies on ac!ie/ing customer satisfaction$ Moreo/er0 BAN3 A&FA&A4 &IMI+-D is a growing organi8ation and w!en organi8ation grows0 its emplo"ees also grow$ All t!e information in t!is report is #ased upon m" o#ser/ation0 inter/iews and practical in/ol/ement in different tasks during m" interns!ip at Bank M" report is di/ided in ? sections$ +!e first one contains t!e introduction of #ank and BA&$ BA& is a #ig name in t!e world of #anking$ It.s a real BI' +4IN' as it !as its @

network spread countr" wide and internationall" of course$ Its 26? #ranc!es in 6? cities sa" it all< +!e second portion is all a#out m" e7perience at BA& i$e$ w!at I learnt t!ere$ M" e7perience at Alfala! was like a slice of a surprise cake0 e/er" #ite of w!ic! was !a/ing somet!ing new to taste$ And I en5o"ed e/er" #ite of it$ It was an entirel" new e7perience0 it was lifeA and I won.t #e wrong if I sa" it was an e7perience of a life time$ I worked in AB( opening and Foreign +rade and spend m" ma7imum time in e7ports$ I also worked in credit department 2 learn a lot$ I also worked in accounts department for one week$ +!e reason #e!ind it was t!e rus! of internees0 lack of time at emplo"ee.s end and m" own temperament$ I also work for audit preparation for one week$ +!e t!ird portion contains t!e financial anal"sis of BA& w!ere I./e anal"8ed t!e working of Bank Alfala! &imited regarding cas! flow ratios0 liCuid ratios0 marketD#ased ratios and special #ank ratios etc$ +!e o/erall sol/enc" of #ank is good$ +!e fourt! portion is a#out t!e financial anal"sis from w!ere #ank generate mone" for financing and accounting s"stem of t!e organi8ation$ I also mention t!e S9%+ anal"sis of t!e #ank Alfala! limited$ At t!e end I gi/e some suggestions for furt!er impro/ement$

TABLE OF CONTENTS +I+&D-DI(A+I%N A(3N%9&-D'-M-N+ ->-(,+IF- S,MMA*G +AB&- %F (%N+-N+S S-(+I%N HI IN+*%D,(+I%N +% BAN3 A&FA&A4 &IMI+-D H$ %*'ANIJA+I%N.S B,SIN-SS S-(+%* H$H%F-*FI-9 %F BAN3 A&FA&A4 &IMI+-D H$2$ 4IS+%*G %F +4- %*'ANIJ+I%N H$2$E$ NA+,*- %F +4- %*'ANIJA+I%N H$K$ B,SIN-SS F%&,MH$?$ S-*FI(-SB)*%D,(+S H$?$H$ 4%M- FINAN(H$?$2$ (A* &%ANS H$5$ (*-DI+ (A*DSI H$ $ BAN3 A&FA&A4.S D-BI+ (A*DI H$6$ +G)-S %F A((%,N+ %FF-*-D BG +4A+ BAN3 H$@$ M%N-G'*AM H$E$ (%M)-+I+%*S H$HL$ %*'ANIJA+I%NA& S+*,(+,*- %F BA& H$HL$H$ N,MB-* %F -M)&%G--S H$HL$K$ IN+*%D,(+I%N %F A&& +4- D-)A*+M-N+S H$HL$?$ (%MM-N+S %N +4- %*'ANIJA+I%NA& S+*,(+,*-I H$HH$ IN+*%D,(+I%N %F BAN3 A&FA&A4 &IMI+-D ',1*AN9A&A 2$ +*AININ' )*%'*AMI 2$H$ MA((%,N+ %)-NIN' 2$2$H%)-*A+I%NS D-)A*+M-N+ A+ ',1*AN9A&A B*AN(4I 2$2$2$ MANA'-M-N+ A+ %)-*A+I%NS D-)A*+M-N+ 2$2$K$ A((%,N+ %)-NIN' D-)A*+M-N+ 2 (4-N,- B%%3 ISS,AN(- 2 &%(3-*S 2$K$ )*%(-D,*- %F A((%,N+ %)-NIN' 2$?$ A((%,N+ (&%SIN' 2$?$?$ S+%) )AGM-N+ 2$?$5$ (4-N,- B%%3S *-(IFIN' 2 ISS,AN(2$?$ $ IN (AS- %F (4-N,- B%%3 &%S+ 2$?$6$ MAN,A& (4-N,-S 2$?$@$ *-(-IF- +4- (4-N,- B%%3 BG %+4-* )-*S%N %N B-4A&F %F A((%,N+ 4%&D-* 2$?$E$ A(+IFA+I%N %F D%*MAN+ A((%,N+ 2$?$HL$ (4AN'- %F ADD*-SS 2 +-&-)4%N2$?$HH$ (4-N,- FI&&IN' Page # ! "#$ %#&
'(# ' '' ') ')#'" '" '$ '%#)" '%#'* '*#)( )(#)) )) ))#)! )" )$ )% )* )*#)& )& (# ' )#'() #%' ! ! "#%' !&#") ")#"" ""#"$ "% "*#"& $( $(#$ $ #$! $!#$" $$

HL

2$5$ M%N-G '*AM 2$ $ &%(3-*S 2$6$ A((%,N+S D-)A*+M-N+ 2$@$ (*-DI+ D-)A*+M-N+ 2$E$ +*AD- D-)A*+-MN+ 2$E$H?$ +AS3S +4A+ I )-*F%*M-D 2$HL$ FINAN(- D-)A*+M-N+ K$ FINAN(IA& ANA&GSIS K$?$ (A&(,&A+I%NS %F S)-(IA&IJ-D *A+I%S K$5$ (A&(,&A+I%NS F%* &-F-*A'- *A+I%S K$ $ MA*3-+ ANA&GSIS K$6$ (AS4 F&%9 ANA&GSIS K$@$ A(+IFI+G *A+I% K$E$ )*%FI+ABI&I+G *A+I% K$HL$H 4%*IJAN+A& ANA&GSIS K$HL$2 '*A)4I(A& *-)*-S-N+A+I%N %F F-*+I(A& ANA&GSIS K$HH$ F,+,*- )*%S)-(+S %F +4- %*'ANIJA+I%N K$H2$ (%M)A*IS%N 9I+4 (%M)-+I+%*S ?$ S9%+ ANA&GSIS 5$ *-(%MM-NDA+I%N $ (%N(&,SI%N BIB&I%'*A)4G '&%SSA*G )-*S%NA& INF%*MA+I%N

$%#$* $&#%' %)#%$ %%#*& &(#&% &* ''(#''! '( #'!) '("#'(& ''"#')( ')'#')! ')(#')) ')"#')& ' (#' ) ' #' % '!(#'!$ '!$ '!% '!*#'"' '")#'" '"! '"" '"$#'"% '"*

HH

H2

H$ BRIEF INTRODUCTION OF THE ORGANI+ATION,S BUSINESS SECTOR). I/012345062/ 27 8a/96/g :e5021 6: /20 3e:5168e3. . T1a36/g a/3 :a;e: It includes fi7ed income0 eCuit" foreign e7c!ange0 commodities0 credit0 funding0 own position securities0 lending and repos0 #rokerage de#t and prime #rokerage$ Re0a6; 8a/96/g It includes lending and deposits0 #anking ser/ices0 trust and estates0 pri/ate lending and deposits0 #anking ser/ice0 trust and estate in/estment ad/ice0 merc!antB commercialB corporate cards and pri/ate la#els and retails$ C2<<e156a; 8a/96/g (ommercial #anking include pro5ect finance0 corporate finance0 real estate0 e7port finance0 trade finance0 factoring0 leasing0 lending0 guarantees0 #ills of e7c!ange and deposits$ C21=21a0e 76/a/5e (orporate #anking includes ser/ices pro/ided in connection wit! mergers and acCuisition0 placements$ SUBSIDIARIES OF BANK ALFALAH LIMITEDunderwriting0 pri/ati8ation0 securiti8ation0 researc!0 de#ts (go/ernment0 !ig! "ield)0 eCuit"0 s"ndication0 I)% and secondar" pri/ate

HK

AL-BADER INTERNATIONAL DEVELOPMENT CO.

'.'OVERVIEW OF BANK ALFALAH LIMITED-

)ri/ate +"pe Founded 4eadCuarters 3e" people Industr" )roducts *e/enue 9e#site 3S-I &S-I 3arac!i )rincipal %ffice0 3arac!i )akistan 4$-$ S!eik! 4amdan Bin Mu#arak Al Na!a"an ((!airman) Banking (apital Markets &oans0 credit card0 sa/ings0 consumer #anking etc$ )3* www$#ankalfala!$com

'.)BRIEF HISTORYBa/9 A;7a;a> L6<60e3 is located in 3arac!i0 Sind!0 )akistan$ Bank Alfala! was H?

incorporated on 1une 2H0 HEE6 as a pu#lic limited compan" under t!e (ompanies %rdinance HE@?$ Its #anking operations commenced from No/em#er H0 HEE6$ +!e #ank is engaged in commercial #anking and related ser/ices as defined in t!e Banking companies ordinance0 HE 2$ Strengt!ened wit! t!e #anking of t!e A#u D!a#i 'roup and dri/en #" t!e strategic goals set out #" its #oard of management0 t!e Bank !as in/ested in re/olutionar" tec!nolog" to !a/e an e7tensi/e range of products and ser/ices$ +!is facilitates #ank.s commitment to a culture of inno/ation and seeks out s"nergies wit! clients and ser/ice pro/iders to ensure uninterrupted ser/ices to its customers$ Bank percei/es t!e reCuirements of its customers and matc!es t!em wit! Cualit" products and ser/ice solutions$ During t!e past fi/e "ears0 #ank !as emerged as one of t!e foremost financial institution in t!e region endea/oring to meet t!e needs of tomorrow toda"$ '.).'. H6:021? 27 8a/9 A;7a;a> ;6<60e3Bank Alfala! !as gone t!roug! different p!ases o/er t!e "ears$ Its name !as #een c!anged in t!e following seCuence$ Bank of credit and commerce and international (B((I)AAAAAAHE62 4a#i# (redit and e7c!ange #ankAAAAAAAAAAAAAAAHEE2 Bank Alfala!AAAAAAAAAAAAAAAAAAAAAA$$HEE6

'.).). I/012345062/ 27 BCCIBank Alfala! limited was #eing formed after going t!roug! different c!anges$ At first t!e #ank Alfala! limited was working t!e name of #ank of credit and commerce international (B((I)$ B((I was incorporated in &u7em#urg on Septem#er 2H0 HE62$ At t!at time it=s paid up capital was ,S O 2L50 million$ B" earl" HE6K B((I !as esta#lis!ed its first ? #ranc!es in t!ree countries$ o &u7em#urg o ,Ao ,3 9it! t!e passage of time t!e #ranc! network of #ank Alfala! limited was e7pand rapidl" in different region of t!e world i$e$ far east0 Africa0 -urope and western and &atin America$ H5

'.). . B1a/5>e: 27 BCCI 6/ Pa96:0a/+!ere were t!ree #ranc!es of B((I in )akistan$ +!ese were o 3arac!i o &a!ore o *awalpindi +!e &a!ore #ranc! was opened on H5t! Decem#er HE6@$ +!is #ranc! was opened at t!at time w!en some ot!er international #anks like citi #ank0 #ank of America and American e7press etc$ were alread" working$ But wit!in a few "ears t!is #ranc! crossed mostl" all t!e ot!er #anks in case of deposits0 ad/ances0 imports 2 e7ports dealings$ '.).!. L6@463a062/ 27 BCCIB((I was closed on 1ul" 50 HEEH$ At t!at time B((I was opening almost E countries in t!e world$ It !ad K operating #ranc!es in )akistan$ 9!en financial aut!orities launc!ed a coordinated swoop0 it was supposed to #e t!e #iggest international fraud stor" in !istor"$ '.).". I/521=21a062/ 27 Ha868 51e360 A eB5>a/ge 8a/9In 1ul" HEEH0 t!e #ranc!es of B((I in )akistan at t!at time were taken o/er #" +!e Ministr" of Finance and SB)$ All t!ree #ranc!es were under 4a#i# Bank &imited after /aluation of its assets for H5 million dollars$ It worked wit! 4a#i# Bank &imited as a su#sidiar" for around a#out HL mont!s from H? Marc! HEE2 to KHst %cto#er HEE2 '.).$. P16Ca06Da062/ 27 Ha868 51e360 A eB5>a/ge 8a/94$($-$B was pri/ati8ed on 1ul" 60 HEE6$ 6LP s!ares and management was taken o/er #" A#u D!a#i #ased AlDNa"!an consortium$ +!is consortium consists of foreign in/estors of ,A- and !ig!l" professional )akistani #ankers$ +!e #ank was sold for *s$ KE per s!are for 6LP s!ares$ +!e go/ernment decides to sell HLP s!ares to emplo"ees and rest of t!e s!ares was pri/ati8ed t!roug! t!e stock e7c!ange$ '.).%. E<e1ge/5e 27 8a/9 A;7a;a>Following t!e pri/ati8ation in 1ul" HEE60 4a#i# credit and e7c!ange #ank assumed t!e new identit" of #ank Alfala! on Fe#ruar" 250 HEE@$ It is now A#u D!a#i #ased #ank as t!e famil" of S!eik! Na!a"an Mu#arik alDNa!a"an purc!ased 6LP of its s!ares$ Bank Alfala! &imited was launc!ed on 1une 2H0 HEE6 as a pu#lic limited compan" under t!e (ompanies %rdinance HE@?$ +!e #ank commenced its operations on No/em#er H0

HEE6$ +!e #ank introduced commercial #anking and related ser/ices as defined in t!e Banking (ompan"=s ordinance0 HE 2$ After a few "ears0 t!e #ank introduced its new identit" of 4$($-$B after t!e pri/ati8ation in HEE6$ +!e management of t!e #ank !ad implemented strategies and policies so t!e #ank would #ecome a ma5or pla"er in t!e market$ 9it! a partners!ip wit! t!e A#u D!a#i 'roup t!e position of t!e #ank #ecame stronger w!ic! allowed t!e #ank to in/est more in re/olutionar" tec!nolog" to increase its range of products and ser/ices$ '.).*. Ba/g;a3e:>I Bank Alfala! took o/er S!amil #ank of Ba!rain and renamed it to #ank Alfala! in 2LL5 %n t!e H t! of Ma"0 2LL5 Bank Alfala! formall" took o/er t!e Banglades! operations of S!amil Bank of Ba!rain for ,S OH6$@@ million and renamed it to Bank Alfala!$ +!is was t!e first #ranc! of t!e #ank outside )akistan$ (urrentl" t!ere are t!ree #ranc!es of t!e #ank in t!e countr"0 two #eing in D!aka and t!e ot!er #eing in (!ittagong$ Na041e 27 21ga/6Da062/Bank Alfala! &imited is a pri/ate #ank in )akistan owned #" t!e A#u D!a#i 'roup$ Bank Alfala! was incorporated on 1une 2H0 HEE6 as a pu#lic limited compan" under t!e (ompanies %rdinance HE@?$ Its #anking operations commenced from No/em#er H0 HEE6$ +!e #ank is engaged in commercial #anking and related ser/ices as defined in t!e Banking companies ordinance0 HE 2$ After a few "ears0 t!e #ank introduced its new identit" of 4$($-$B after t!e pri/ati8ation in HEE6$ +!e management of t!e #ank !ad implemented strategies and policies so t!e #ank would #ecome a ma5or pla"er in t!e market$ 9it! a partners!ip wit! t!e A#u D!a#i 'roup t!e position of t!e #ank #ecame stronger w!ic! allowed t!e #ank to in/est more in re/olutionar" tec!nolog" to increase its range of products and ser/ices$ +!e #ank is currentl" operating t!roug! more t!an 26? #ranc!es domesticall" and an international presence in Afg!anistan0 Banglades! and Ba!rain0 wit! t!e registered office at B$A$Building0 I$I$(!undrigar0 3arac!i$ Some of t!e main #ranc!es are located in all of t!e ma5or cities includingI &a!ore0 3asur0 Islama#ad0 'awadar0 )es!awar0 Faisala#ad0 Nuetta0 D$I$3!an0 *awalpindi0 Sargod!a0 Sukkur0 Sialkot0 Multan0 Murree0 Attock District0 'u5ranwala0 )irma!al etc$

H6

H@

'. . BUSINESS (VOLUME)+!e directors of Bank Alfala! &td !a/e su#scri#ed to rig!t s!ares in accordance wit! t!eir entitlement on t!e #asis of a num#er of s!ares !eld #" t!em and so far deposited *s 6L@$LE6 million in t!e #ank.s account$ According to a communiCue dispatc!ed to 3S- on 9ednesda"0 t!e" included 4amadan Bin Mu#arak Al Na!a"an0 A#dulla! Naseer 4awaileel0 A#dulla! 3!alif Al Mutawa0 and 3!alid Mana Saeed Al %tai#a0 Ikram ulD Ma5eed Saigol0 Nadeem IC#al S!eik! and Sira5uddin A8i8$ It ma" #e noted t!at t!e #oard of directors of Bank AlDFala! in a meeting !eld in A#u D!a#i0 ,A- on Decem#er H50 2LL@ appro/ed t!e issue of 5L percent rig!t s!ares (one s!are for e/er" two s!ares) at a face /alue of *s HL per s!are to en!ance its paid up capital$ Bank Alfala! &imited0 t!roug! its su#sidiaries0 pro/ides retail and commercial #anking0 and corporate finance products and ser/ices in )akistan0 t!e Asia )acific0 and t!e Middle -ast$ +!e compan".s retail #anking products and ser/ices include retail lending and deposits0 pri/ate lending and deposits0 trust and estates in/estment ad/ice0 merc!antBcommercialBcorporate cards0 and pri/ate la#elsQ commercial #anking products and ser/ices include pro5ect finance0 corporate finance0 real estate0 e7port finance0 trade finance0 factoring0 leasing0 lending0 guarantees0 #ills of e7c!ange0 and /arious deposit productsQ and corporate finance products and ser/ices include ser/ices in connection wit! merge$ Bank Alfala! &td$ reported earnings results for t!e "ear ended Decem#er KH0 2LL@$ For t!e period0 t!e profit #efore ta7ation declined to )3* H$6E? #illion as compared to )3* ?$5K5 #illion earned in t!e corresponding period in 2LL6$ +!e profit after ta7ation declined to )3* H$KLH #illion in t!e period under re/iew against )3* K$HKL #illion earned in t!e same period a "ear #ack$ +!e #ank earning per s!ares declined to )3* H$ K against )3* K$E2 recorded in 2LL6$ +!e #ank=s markDupBreturnBinterest earnings increased to )3* KH$L? #illion against )3* 25$6@K #illion$ +!e #ank=s total nonDmarkDupBinterest income declined to )3* 5$2?5 #illion against )3* $LK@ #illion$ ReCe/4e Ne0 6/52<e R)3* 25$6@K Billion R)3* K$HKL Billion

HE

'.!. S-*FI(-SB)*%D,(+S %FF-*-D BG BAN3 A&FA&A4 &IMI+-DI Bank Alfala! &imited0 t!roug! its su#sidiaries0 pro/ides retail and commercial #anking0 and corporate finance products and ser/ices in )akistan0 t!e Asia )acific0 and t!e Middle -ast$ +!e compan".s retail #anking products and ser/ices include retail lending and deposits0 pri/ate lending and deposits0 trust and estates in/estment ad/ice0 merc!antBcommercialBcorporate cards0 and pri/ate la#elsQ commercial #anking products and ser/ices include pro5ect finance0 corporate finance0 real estate0 e7port finance0 trade finance0 factoring0 leasing0 lending0 guarantees0 #ills of e7c!ange0 and /arious deposit productsQ and corporate finance products and ser/ices include ser/ices in connection wit! mergers and acCuisition0 underwriting0 pri/ati8ation0 securiti8ation0 researc!0 go/ernment and !ig! "ield de#ts0 eCuit"0 s"ndication0 I)%0 and secondar" pri/ate placements$ It also operates as an in/estment ad/isorBfund manager0 as well as floats and manages openDended and closedDended funds$ +!e compan".s products and ser/ices also include deposit accounts0 lockers0 remittance0 and !ilalBde#it cardsQ structured finance0 trade finance0 lease finance0 small and medium enterprise finance0 and agriculture financeQ credit cards0 !ome loans0 and autoB/e!icle loansQ and mone" market0 fore7 market0 correspondent #anking0 nostro account0 consumer #anking0 and !ome remittance products and ser/ices$ As of Decem#er KH0 2LL@0 it operated a network of 26? #ranc!es$ '.!.'. HOME FINANCEFollowing products in t!e 4ome &oan are offered #" Bank Alfala!$ '.!.'.'. PRODUCTS '.!.'.). H2<e P415>a:e9it! t!is facilit"0 customer no longer need to 5ust dream a#out t!e !ome !e wants for !imself and !is famil" $Bank Alfala! will pro/ide customer up to @LP of t!e purc!ase price of t!e propert" (w!ic!e/er is less)0 so t!at customer can reali8e !is dream and enter t!e realit" of owning a !ome$ )a"ment period ranges from K to 2L "ears$ '.!.'. . H2<e C2/:01450If customer !as a plot and need finance to construct a !ome0 w!ic! e7cites e/er"one in "our famil"< No pro#lem$ Bank Alfala! will pro/ide customer HLLP of t!e estimated /alue of constructed propert" to ena#le !im to sa" goodD#"e to rent fore/er< -/en if customer don=t !a/e a plot0 Bank Alfala! will pro/ide customer up to LP of t!e /alue of

2L

t!e plot t!at customer !as selected to purc!ase< )a"ment period ranges from K to 2L "ears$ '.!.'.!. Ba;a/5e T1a/:7e1 Fa56;60?(ustomer.s e7isting installment on a !ome finance lea/e customer wit! not!ing to spend$ (ustomer need not worr" an" more #ecause Bank Alfala! !as genuinel" low rates and pa"ment options t!at could lea/e more funds wit! customer eac! mont!$ 9it! Bank Alfala!.s B+F0 repa"ing !ome finance will not make customer #reak into a sweet< +ransfer up to HLL P of t!e e7isting finance$ (ustomer can stretc! repa"ment period for up to 2L "ears$ '.!.'.". H2<e Re/2Ca062/ If "our customer alread" own a !ome0 #ut need e7tra space for a growing famil" or want to see some rooms get a new look$ Simpl" appl" for financing of up to *s$ K$5L million or ?LP of t!e sur/e"ed /alue of "our !ome and get "ourself t!e e7tra space$ Gou can stretc! "our pa"ments for up to HL "ears$ 4ome Start +!e crown 5ewel of 4ome Finance Sc!eme0 t!e golden opportunit" for someone starting a career to #u" an alread" constructed !ousing unit so earl" in life< Bank Alfala! offers a moratorium of up to K "ears in principal pa"ments0 for a financing of up to 2L "ears$ (ustomer ser/ices onl" t!e markDup element initiall"0 and principal repa"ment starts after t!e end of moratorium period$ H2<e S0a10 is speciall" designed for "oung people to own a !ome of t!eir own$ '.!.). CAR LOANS%#5ecti/e +!e main o#5ecti/e of t!e car finance department is to finance all t!e cars manufactured or assem#led in )akistan and imported cars at a /er" reasona#le markup$ '.!.).'. Be/e760: a/3 Fea041e: Nuickest processing No !idden c!arges Minimum down pa"ment (omplete repa"ment at an" point of time Balance transfer facilit" SB+FT for e7isting as well as new clients from ot!er 2H

Banks +enure period ranging from H to 5 "ears$ Financing of all #rand new locall" assem#led /e!icles and used cars$ Financing limit ranging #Bw *s$ 2LL0LLLBD to *s$ 2LLL0LLLBD for #rand new cars

'.!.).). C21=21a0e A I/36C634a; Ca1 Lea:6/gBA&.s recentl" introduced car leasing facilit" for indi/iduals and corporate sector !as set new dimensions for t!e product$ Now customers are pro/ided wit! t!e option of eit!er to get t!e /e!icle leased or financed$ '.!.). .I/:41a/5e *enowned and relia#le Insurance companies are offering t!e competiti/e rates of Insurance0 per "ear insurance premium in ad/ance Sat t!e time of down pa"mentT and remaining in t!e su#seCuent eCual mont!l" installment$ '.!.).!. P125e::6/g Fee (N2/ Re74/3a8;e)For financing upto *s$ For financing upto *s$ For financing upto *s$ For financing o/er *s$ '.!.).". Ma19#4= Ra0e:H Gear 3IB%* U 2P for salaried person H Gear 3IB%* U KP for Business )eople B SelfDemplo"ed and %/erseas )akistani (#ot! salaried and selfDemplo"ed) ' Yea1 o Salaried '!.((E per Annum H$LLM 2$5LM 5$LLM 5$LLM 5LLL HL0LLL H205LL H50LLL

o SelfDemplo"ed )rofessionals 2 Businessmen and %/erseas )akistani (#ot! salaried and selfDemplo"ed) '".((E )er Annum

+!ese are indicati/e rates re/iewed mont!l"

'.!.).$. La0e Pa?<e/0 C>a1ge:-

22

*s$ 5LLBD per late pa"ment

'.!.).%. P1e=a?<e/0 C>a1ge:: Nill if repaid t!roug! own sources0 ot!erwise 5P penalt" of t!e outstanding amount$ No c!arges are applied on #alloonB#ullet pa"ments for reducing "our loan amount

'.!.).*. D254<e/0a062/ C>a1ge:- At actual0 including stamp dut" c!arges for legal documentation0 onDsite inspection during construction0 law"er.s fee and c!arge registration fee0 as ad/ised #" t!e rele/ant personsB agencies$ VAll Cuoted rates are su#5ect to c!ange in response to SB) B Market factors$ 4owe/er0 we will notif" our customers of eac! rate c!ange$ '.". CREDIT CARDSBank Alfala! (redit (ard is "our partner e/er"w!ere and is glo#all" accepted and welcomed at locations displa"ing t!e FISA logo$ It is accepted at nearl" 2E million locations in more t!an H5L countries around t!e glo#e and o/er 220LLL Bank Alfala!.s esta#lis!ments in )akistan$ Alfala! FISA lets "ou pa" for s!opping0 tra/el0 entertainment0 meals and muc! more$ (ard mem#ers are facilitated t!roug! a num#er of promotions from time to time$ In addition0 t!ere are a num#er of strategic #usiness partners!ips wit! leading local and international #rands for purc!ase of !ome appliances at e7citing StepDBGDStep (SBS) mont!l" installment plan wit! free !ome deli/er" at lowest interest rates$ Salient features areI o No 1oining B Annual B *enewal fee o -lectricit"0 Sui 'as0 )+(& and 9arid #ills pa"ment t!roug! 2? !our (all (enter and Auto De#it instructions o SMS for card usage0 mini statement0 pa"ment receipt confirmation0 etc$ o (as! wit!drawal at all H&IN3 A+Ms o Special offer on 9arid post paid connections '.".'. ReC2;C6/g C1e360

2K

9it! Alfala! Fisa a customer !as t!e option of pa"ing onl" 5P (minimum *s$ 5LLBD) of !is outstanding #alance #" t!e pa"ment due date$ Ser/ice c!arges at t!e rate of 2$25P per mont! will #e le/ied on t!e #alance unpaid and carried forward$ +!ese c!arges are calculated on a dail" #asis from t!e transaction date for all cas! and retail transactions$ +!e following mont!0 customer !as t!e option of eit!er t!e full amount pa"ment or if !e wis!es0 pa" onl" t!e minimum amount due and re/ol/e again$ '.".'. F1ee S4==;e<e/0a1? Ca13: Bank Alfala! gi/es up to si7 supplementar" cards for t!e spouse0 c!ildren0 parents and si#lings of t!e card!older$ All t!e persons !a/ing supplementar" cards can use t!e card up to t!e limit of t!e original card!older$ '.".). +e12 L2:: L6a86;60? If t!e card is lost or stolen0 and t!e card!older notifies t!e #ank immediatel" after suc! e/ent0 t!en t!e #ank will #e responsi#le for an" misuse of t!at card$ '.". . A;; B6;;6/g 6/ Pa9 R4=ee: 9!et!er t!e customer makes transactions in Dollars or an" ot!er currenc"0 for !is con/enience0 all !is #illing will #e in )A3 *upees$ '.".!. C2<=1e>e/:6Ce T1aCe; P120e5062/ Alfala! FISA offers a compre!ensi/e co/er up to *s$ 6$L Million on Alfala! FISA 'old (ard in case of an accident0 w!ile tra/eling on an" common carrier$ It is applica#le onl" if t!e tickets are c!arged t!roug! Alfala! FISA card$ All transactions will appear under a separate !eading stated as :(redit (o/er )remium$; Gou will #e c!arged ?5 paisa.s per *s$ HLL of "our statement #alance eac! mont!$ '.".". Lega;606e: +!e rig!ts and o#ligations of an" card mem#er su#scri#ing to Alfala! (redit (o/er will #e go/erned #" t!e definitions0 terms and conditions gi/en on t!e #ack of t!is form$ B" /irtue of (redit (o/er0 Bank Alfala! aims to offer t!roug! an insurance compan" of its c!oice0 certain protection to t!ose card mem#ers w!o are su#scri#ing to (redit (o/er in t!e e/ent of deat!0 prolonged illness0 permanent0 temporar" or total disa#ilit"$ Followings are the credit cards offered by bank Alfalah limited: '.".$. P;a06/4< Ca13 It is accepted at nearl" 2E million locations in more t!an H5L countries around t!e glo#e

2?

and at o/er 220LLL esta#lis!ments in )akistan$ T60a/64< +itanium Master(ard is "our partner e/er"w!ere and is glo#all" accepted and welcomed at locations displa"ing t!e Master(ard logo$ '.".%. G2;3 A S6;Ce1 A perfect card com#ination for all segments of salaried 2 professional indi/iduals$ '.".*. Y24/g P127e::62/a; +!is (ard is for "ou0 if "ou areI W a 'raduate W !as 5ust started "our (areer '.".&. W2<e/ EB5;4:6Ce Now for t!e first time in )akistan0 Bank Alfala! !as introduced a credit card e7clusi/el" for women$ +!is card !as its uniCue features$ '.".'(. S043e/0 Ca13 For t!e first time in )akistan0 Bank Alfala! introduces a credit card for Students$ '.".''. S4==;e<e/0a1? Ca13 Now "ou can gi/e Free Supplementar" (ards to an"one "ou care for '.".'). V6:a M6/6 Fisa Mini is a practical and con/enient part of "our e/er"da" life D w!et!er "ou go for s!opping0 dine out0 #u" grocer"0 want to go for !olida"s$ '.$. BANK ALFALAH,S DEBIT CARDAlfala! 4ilal (ard is t!e re/olutionar"0 newDage form of cas! t!at pro/ides "ou greater freedom0 securit" and con/enience0 com#ined wit! t!e wide reac! of Fisa Network$ +!is single card #rings 5ust a#out e/er"t!ing wit!in "our reac!$ Now0 "ou can use "our Alfala! 4ilal (ard for all "our financial needs around t!e world0 round t!e clock0 w!ere/er Fisa cards are accepted0 locall" and internationall"$ +!e Alfala! 4ilal(ard is an International Fisa De#it (ard w!ic! gi/es "ou an unlimited access to "our current B sa/ings account wit! a simple swipe0 at millions of retail s!ops and A+Ms0 worldwide$ '.%. TYPES OF ACCOUNT OFFERED BY THAT BANK For an" t"pe of transaction and for a/ailing an" t"pe of credit facilit" t!e Hst and most important step for customer is t!at !eBs!e must #e account!older of #ank$ So !e must

25

open !isB!er account in t!e #ank and t!en !e can proceed furt!er$ %n t!e #asis of nature of account %n t!e #asis of functionalit" %n #asis of currenc"

'.%.'. O/ T>e Ba:6: O7 Na041e- +!ese accounts are furt!er di/ided into t!ree main categories0 w!ic! are as followsI 1.7.1.1. Saving Account: Sa/ing accounts are t!ose accounts in w!ic! t!e #ank gi/es t!e customers profit on t!eir deposits$ Bank also deducts 8akat on t!is account$ For opening t!e sa/ing account t!e customer.s initial deposit must not #e less t!an *s$ 5LLL$ +!e special code is assign to t!is account is L2$ +!is account is also furt!er di/ided into K categories Sa/ing account )rofit and loss account *o"al profit account

'.%.). C411e/0 A5524/0- (urrent accounts are t!ose accounts in w!ic! we gi/e no profit to customer on t!eir deposits$ Bank also deducts no 8akat on t!is account$ For appending t!e current account t!e customer.s initial deposit must not less t!en *s$HL0 LLL$ +!e special code is assign to t!is account is ('. '.%. . Te1< De=2:60 A5524/0: In t!is account t!e customer gets its amount fi7ed for a specified period of time$ Bank adds interest in t!is account and t!e customer is not allowed to wit!draw t!e mone" #efore t!e e7pir" of t!e tenure$ %n t!e #asis of functionalit": +!is account is also di/ided into t!ree categories$ +!ese are as follows$ '.%.!. B4:6/e:: A5524/0: +!is account is related to t!e #usiness communit"$ +!is account is also furt!er su#di/ided into t!ree categories$ Sole proprietor account )artners!ip account &imited (ompan" account

'.%.". Pe1:2/a; A5524/0- +!e accounts related to persons ot!er t!an companied and partners!ip firms are called personal accounts$ +!ese are furt!er su#di/ided into t!ree 2

categoriesI )ersonal account 1oint account

'.%.$. O/ T>e Ba:6: O7 C411e/5?- +!is account is also di/ided into two categories$ +!ese are as followsI &ocal (urrenc" account Foreign (urrenc" Account

'.%.%. L25a; C411e/5? a5524/0+!e account dealing wit! t!e local currenc" is called local currenc" account$ F21e6g/ C411e/5? A5524/0+!e account dealing wit! t!e foreign currenc" is called foreign currenc" account$ +!is account is furt!er su#di/ided into following$ ,SD -uro 1)G

'.%.*. A;7a;a> K67a?a0 A5524/0+!is account is for indi/idualB5oint customers onl"$ %t!er customers like companies0 corporate etc are not eligi#le for opening of t!is account$ Minimum #alance reCuirement for opening t!is account is *s$ HL0LLLBD wit! a ma7imum of *s$H0 LLL0LLLBD

26

'.*. MONEYGRAM-

'.*.'. FEATURES
Bank Alfala! limited0 in colla#oration wit! M2/e? G1a<0 offers remittance ser/ice to )akistan$ Mone" 'ram is personDtoDperson mone" transfer ser/ice t!at allows consumers to recei/e mone" in 5ust a few minutes$ '.*.). SECURE AND RELIABLE An e7tensi/e network of Cualit" agents linked #" computer0 transfer customer.s mone" safel" and ensures t!at it is !andled wit! care and wit!out dela"$ +!ousands of people alread" use t!e Mone" 'ram ser/ice all o/er t!e world$ It is trusted for its relia#ilit" and securit"$ '.*. . CONVENIENT AND FAST Mone" 'ram is a/aila#le in o/er H5? countries and in more t!an ?L0LLL locations worldwide$ 9it! Mone" 'ram customer.s mone" is transferred immediatel" and usuall" arri/es at t!e recei/ing end wit!in HL minutes w!ile ot!er ser/ices can take da"s or weeks$ +!ere are no complicated procedures and customers do not need a #ank account or a credit card$ +!e recei/er is !anded t!e cas! immediatel"$
'.*.!. FREE MESSAGE SERVICE (FOR SENDERS)

+!ere is also an added personal touc!D"ou can recei/e a HL word message from t!e sender wit! e/er" transaction at no e7tra cost$
'.*.". WAY TO RECEIVE MONEY

'.*.$. T2 1e5e6Ce <2/e?-nsure t!at t!e sender !as gi/en "ou t!e Mone" 'ram reference num#er$ 'o to an" Bank Alfala! aut!ori8ed #ranc!0 taking some form of identification (e$g$ passport) wit! "ou$ )ro/ide t!e reference num#er and complete a simple form$ (ustomer will #e gi/en t!e mone" immediatel"0 in "our local currenc"$ '.*.%. MONEY GRAM AT BAL GRW At Bank Alfala! 'u5ranwala Mr$ Faisal is t!e Inc!arge of Mone" gram$

2@

'.&. COMPETITORS+!e ma5or competitors of #ank Alfala! are Allied #ank ,nion #ank Standard c!arter M(B

%&&"((((( N4<8e1 27 :>a1e >2;3e1: '% !

2E

'.'(. ORGANI+ATIONAL STRUCTURE OF BAL GUJRANWALA BRANCHB1a/5> Ma/age1 S!eik! Masood -la!ee

C1e360 Ma/age1 Mr$ 4ama"oun *asool Mal!ee

O=e1a062/: Ma/ge1 Mr$ Malik 1a/aid

T1a3e Ma/age1 Miss Saira (!ud!ar"

H2<e L2a/ Mr$ Faisal Mr$ S!a!id

O7765e1 Mr$ Asim Me!mood

Ag16#C1e360 Mr$ S!a!8ad Naseem

Re<600a/5e Mr$ Namar

A5524/0: Mr$ Faisal Miss 4ina

C2/:4<e1 Ba/96/g S!a!8ad A!mad M$Asif B!atti

IT 27765e1 Mr$ Adnan Munir

SME Mr$ ,sman Mr$ Mu!ammad Ali

Ca:> De=a10<e/0 9aseem Butt Irfan A!mad Amir Asg!er Amam Adil M$ Daud M$ *i8wan

CRO Miss Maria 3!an

Re041/ A g4a1a/0ee: ,sman Anwer

KL

'.'(.'. NUMBER OF EMPLOYEES+!e #ank Alfala! as e/er"#od" knows is well known #anking organi8ation t!e" !a/e currentl" 605@? emplo"ees all o/er t!e )akistan and t!e num#ers of emplo"ees working in Bank Alfala! 'u5ranwala Branc! are ?5$ '.'(.). MAIN OFFICES '.'(. . INTRODUCTION OF ALL THE DEPARTMENTS At #ank Alfala! '$+ road Branc! following are t!e departments O=e1a062/: o -$g$ Deposits0 *emittances0 Foreign +rade0 &ockers0 account opening0 c!eCue #ooks issuance0 accounts$ C2/:4<e1 De=a10<e/0 o -$g$ (redit (ards0 Auto &oans0 4ome &oans0 (onsumer Dura#les$ E;e5012/65 8a/96/g o -$g$ )!one Banking0 A+M=s0 online #anking$ T1a3e De=a10<e/0 o -$g$ S!ortBlong +erm Finance0 +rade Finance0 Structured Finance$ T1ea:41? A 6/Ce:0<e/0 o -$g$ Mone" Market0 Fore7 Market0 In/estments0 'o/t$ Securities0 (orrespondent detail reCuired o o '.'(.!. COMMENTS ON THE ORGANI+ATIONAL STRUCTUREManagement must !a/e to adopt some administrati/e st"le to get all t!e acti/ities to #e done effecti/el" and efficientl"$ As far as t!e management st"les at #ank Alfala! 'u5ranwala #ranc!0 is concerned0 t!ere is some centrali8ation and decentrali8ation to some e7tent0 #ut most centrali8ed Administrati/e st"le of #ranc! manger Mr$ Masood -la!ee is aut!oritati/e$ 4is aut!oritati/e st"le is t!e reCuirement of administration$ For t!e implementation of #anking$

KH

strategies and getting all t!e acti/ities to #e done properl" wit! an organi8ed en/ironment0 unit" of command is t!e reCuirement of t!e time$ But t!e scenario is different in case of departmental !eads$ In cas! and credit department0 powers are delegated at low le/els$ -mplo"ees are allowed to organi8ed and take necessar" actions to accomplis! t!eir work properl"$ +!e organi8ational structure of BA& is (entrali8ed e/er" t!ing is appro/ed from t!e !ead office t!e" follows t!e polic" of t!eir !ead department w!ic! is in 3arac!i and t!e" follows all t!e polic" w!ic! t!e" send t!em t!at BA& is working successfull" emplo"ees are /er" satisfied and customers get lower difficulties of an" fraud #ecause of centrali8ation$ -mplo"ees directl" reported to manager and t!en manager send t!eir pro#lems to t!e !ead office and t!e" tr" t!eir le/el #est in sol/ing t!e matter$ Bank Alfala!=s management #elie/es in de/eloping t!e potential of t!e #ank=s emplo"ees to t!e fullest e7tent$ +raining 2 de/elopment centre of t!e #ank is !oused in custom #uilt0 state of t!e art facilit" on t!e ?t! floor of t!e !ead office #uilding at 3arac!i$ +!e centre is responsi#le for pro/iding multiDle/el !ig! Cualit" training programs to all staff mem#ers in t!e following areasI o (onsumer #anking operations o (redit marketing 2 credit proposals o (redit administrationBdocumentation o +rade finance operations o Marketing 2 selling skills o (ustomer ser/ice skills o )erformance appraisal skills o +ime management 2 personal effecti/eness It is o#ligator" for eac! staff mem#er of t!e #ank to attend at least one training programmes$ 9!ene/er t!e training department is una#le to pro/ide focused training for certain groups of staff0 reputa#le e7ternal training pro/iders are in/ited to fill t!e gap$

K2

'.''. INTRODUCTION OF BANK ALFALAH LIMITED GUJRANWALAI !a/e done m" interns!ip in BAN3 A&FA&A4 &IMI+-D main '$+$ *oad #ranc! 'u5ranwala$ +!e interns!ip pro/ided me great opportunit" to eCuip m"self wit! knowledge0 tec!niCues0 application and tools used in an organi8ation$ I was /er" muc! e7cited #ecause working at Alfala! was m" dream$ +!e second portion is all a#out m" e7perience at BA& i$e$ w!at I learnt t!ere$ M" e7perience at Alfala! was like a slice of a surprise cake0 e/er" #ite of w!ic! was !a/ing somet!ing new to taste$ And I en5o"ed e/er" #ite of it$ It was an entirel" new e7perience0 it was lifeA and I won.t #e wrong if I sa" it was an e7perience of a life time< Bank Alfala! limited is pro/iding successful #anking ser/ices in man" cities0 so 'u5ranwala cit" is one of t!em$ Falid cit" markets !a/e t!eir unusual importance regarding import #usiness$ +!e" are known as #usiness and commercial !u# of 'u5ranwala$ Ma5or commodities and industrial raw materials are #eing imported in t!ese markets$ Ma5or industrials are routing prefer to route t!eir #usiness t!roug! t!e #anks situated in t!ese areas$ +!ese markets are !ig!l" profita#le and important for #anking sector$ BAN3 A&FA&A4 &IMI+-D ma5or competitors0 ,nion #ank and Askari commercial #ank earned !uge profits in t!is area$ +!erefore0 to capture t!is #usiness and to target t!is /er" important segment0 #ank Alfala! launc!ed its #ranc! in Decem#er 220 2LL20 wit! a #rig!t and clear /ision of customer ser/ice$ In t!e #eginning t!ere were some pro#lems as t!e citi8ens were afraid of depositing t!eir mone" in t!is #ank$ +!e emplo"ees of t!e #ank worked /er" !ard to increase t!e #usiness of t!e #ank in 'u5ranwala$ It was due to t!eir firm determination and !ard work t!at t!is #ranc! of 'u5ranwala working successfull"$ Now in 'u5ranwala BAN3 A&FA&A4 &IMI+-D is making greater profit from rest of t!e #anks$ Bank Alfala! '$+ *oad #ranc! !as t!e importance of #ack#one for BAN3 A&FA&A4 &IMI+-D$ It !as second /olume of foreign trade #usiness and !as led to !uge profits0 5ust wit! in ? or 5 "ears$ During m" interns!ip of weeks at #ank Alfala! I anal"8e t!at t!e emplo"ees are /er" !ardworking and tr" to gi/e #est le/el ser/ices to t!e customers0 customer satisfaction is more /alua#le t!ing for t!em$ -ntire team of Bank Alfala! 'u5ranwala were /er"

KK

cooperati/e and e/er" time read" to sol/e m" pro#lems in case of an" pro#lem$ During m" interns!ip I work in account opening department and c!eCue #ook recei/ing and issuance t!ere I got a lot of e7perience !ow to deal wit! customers$ I got a lot of confidence from t!is sort of en/ironment of #ank Alfala! limited0 so t!is #ranc! is working well #ut due to economic crises it goes down from pre/ious "ears #ut emplo"ees are /er" !ard working and from t!eir firm determination Bank Alfala! will #ecome market leader again in 'u5ranwala$ '.''.'. S0a106/g Da0e 27 <? I/0e1/:>6= a0 Ba/9 A;7a;a> L6<60e3I did si7 weeks Interns!ip at BA&0 so I start m" interns!ip on Ma" HE0 2LLE and ended on 1une KL0 2LLE '.''.). De=a10<e/0: 27 Ba/9 A;7a;a> F>e1e I g20 01a6/6/g A 341a062/It was /er" s!orter time for learning #ut I tr" to m" le/el #est to learn #ut I touc!ed almost t!e main departments of #ank Alfala! 'u5ranwala #ranc!$ I start m" interns!ip from accounting opening0 c!eCue #ook 2 lockers department and !ere I spend 2 weeks of m" interns!ip account opening department is more interested for me$ I also got knowledge of !ow to fill different c!eCue and slips I also got knowledge a#out mone" gram$ After t!at in t!ird week I rotate from account opening to Accounts department !ere I got little #it knowledge a#out accounts #ecause all officers were #us" #ecause of t!eir audit preparations and t!e closing of 1une so0 I got little #it knowledge a#out accounts$ +!en fourt! week I spend one week in credit department !ere I got t!e knowledge of all t!e reCuirements and documents of gi/ing loan$ +!e policies of central #ranc! of #ank Alfala! limited$ +!en t!e fift! week I got t!e knowledge of trade fiancX department and I onl" touc!ed e7port related working and acti/ities$ Si7 week m" last week of interns!ip I spend m" all time in closing t!e accounts its audit working so operations manager gi/e me t!e task of filing t!e accounts and close t!e accounts0 attac! all customers reCuests attac! wit! t!eir account foams$

K?

K5

). TRAINING PROGRAMGWORK DONE BY MEH I reported at Bank Alfala! &imited ('$+ *oad 'u5ranwala) on Ma? '&I )((&$ Mr$ S!eik! Masood -la!ee0 t!e Branc! Manager at t!at #ranc! of Bank Alfala! welcomed me and inCuired a#out m" educational status$ 4e t!en directed me to see Mr$ Malik 1a/ed0 Manager %perations and also t!e interns!ip Inc!arge at t!at #ranc! of Bank Alfala!$ 4e introduced me a#out t!e interns!ip program at Bank Alfala!$ Mr$ Malik 1a/ed0 Manager %perations guided me a#out t!e #anking operations and asked me a#out m" intentions for t!e interns!ip program$ &ater I was instructed to start m" interns!ip from Account opening 2 c!eCue Book issuance0 so t!at I mig!t understand t!e #asic #anking operations$ Miss$ Maria 3!an0 (ustomer *elations officer0 was assigned t!e task of guiding me a#out working of department$ In t!is report0 m" endea/or !as #een to stipulate m" e7periences and o#ser/ations0 during m" interns!ip in Bank Alfala! '$+ *oad0 w!ic! would alwa"s #e memora#le for me$ ).'. HOPERATIONS DEPARTMENT HIERARCHYH
M*$ MA&I3 1AF-D (MANA'-* %)-*A+I%NS)

M*$ FAISA& (A((%N+S D-)+) MISS$ 4INA

MA*IA 34AN A((%,N+ %)-NIN'0 (4-N,- B%%3S

I*FAN (D IN(4A*'(AS4 D-)A*+M-N+

MIAN FAISA& (M%N-G '*AM0 A+M (A*DS0 &%(3-*)

M*$ ADNAN (I+ D-)A*+M-N+)

NAMA* ADNAN0 *AS4ID0 &%(A& +*ASA(+I%NS)

M*$ ASIF B4A+I (%N&IN+*ANSA(+I%NS)

).).'OPERATIONS DEPARTMENT AT GUJRANWALA BRANCH%perations department deals wit! different field of acti/ities dealing wit! accounts of customers0 pro/ides mone" gram facilit"0 locker facilit" and A+M cards0 online transitions0 accounts0 cas! dealing ser/ices$ ).).). MANAGEMENT AT OPERATIONS DEPARTMENTMr$ Malik 1a/ed is t!e operation manger and Mr$ Faisal0 Miss Maria 3!an assists !im in K6

t!e work$ Mr$ Faisal is t!e Inc!arge of Accounts department0 Miss$ 4ina assists !im$ Miss Maria 3!an is t!e Inc!arge of account opening 2 c!eCue Book issuance department$ Mr$ Irfan is t!e Inc!arge of cas! department$ Mr$ Faisal !andles t!e ser/ices of mone" gram$ Mr$ Asif B!ati !andles online transactions$ Mr$ Adnan deals wit! I+ related ser/ices0 Mr$ Adnan0 *as!id and Mr$ Namar deals wit! local transactions$ ).). . ACCOUNT OPENING DEPARTMENT A CHEJUE BOOK ISSUANCE A LOCKERSI spend considera#le time in performing t!e 5o# of Account opening 2 c!eCue Book issuance coordinator 2 lockers$ In account opening department I learned a#out 4ow to deal wit! new customers$ 3inds of accounts offered #" Bank Alfala! &imited$ 9!at are t!e reCuirements for opening an account$ +!e persons w!o are eligi#le to open an account$ )rocedure of closing an account$ Details a#out loose t!e c!eCue$ Details a#out loose c!eCue #ook$ 4ow to acti/ate dormant account of customer$ )rocedure for online an account$ Stop pa"ment on customer reCuest$ (!ange t!e address of customers$ Deal wit! t!e Cueries and pro#lems of e7isting customers$ )roper maintenance of reCuisite documents in files and pouc!es$ Arrange t!e pre/ious files for A,DI+$ )ro/iding account information$ know a#out "our customers (3G(=S)

I worked wit! Miss Maria 3!an in t!is department$ S!e was often #us" dealing wit! customers as in t!is department lots of customers use to come dail"$ But still s!e told me a lot a#out account opening procedure$ S!e also #riefed me !ow to use #ank smart in account opening department$ S!e use to #e /er" polite wit! customers as !er 5o# reCuires t!is$ S!e use to mange relations!ips wit! customers #" pro/iding t!em #etter ser/ices$

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+!erefore customers are pleased$ In t!is department I worked 2 weeks0 at m" first da" Miss Maria told me a#out w!at are t!e reCuirements for open an account0 !ow man" kinds of accounts are t!ere$ At m" first week I understand t!e #asic steps of account opening procedure$ S!e also told me read t!e ot!er forms like closing of an account0 w!at is dormant account0 !ow to acti/ate t!e dormant account0 !ow to issue c!eCue #ook to t!e customers0 !ow to deal wit! new customers0 etc$ S!e told me all t!e t!ings /er" #riefl"0 after t!at s!e ask me to c!eCue t!e forms of different customers 2 if t!ere is somet!ing miss t!en write down it on t!e form$ +!en s!e said me deal wit! a customer w!" s!e comesY I ask w!" "ou come s!e told me I want to open an account$ +!en I told !er a#out #asic #anking account$ ).). .'. BASIC BANKING ACCOUNTBasic #anking account #asicall" open for !ouse wife 2 for salaried person0 HLLL initial deposit is needed for t!is account$ In t!is ma7imum 2 deposits 2 2 wit!drawals t!roug! c!eCue are allowed$ Free de#it card can #e used to wit!draw cas! t!ere is no limit for A+M wit!drawals$ I told !er w!at documents are reCuired for t!is accounts$ +wo clear copies of computeri8ed national identit" card (card !olders signatures0 name0 card num#er and p!oto s!ould #e clear)$ Introducer (#ank Alfala!=s account !older !a/ing good reputation) NI( No$ of ne7t of kin (prefera#l" of #lood relation of customer) In case of !ouse wife account t!ere is need for !er !us#ands source of income pro/e$ (ustomer=s ser/ice cardBappointment letterBsalar" slip or an" ot!er documentar" e/idence of ser/ice0 including0 #ut not limited to a certificate from t!e emplo"er$ If customer signs in language ot!er t!an -nglis!0 an understanding is reCuired on stamp paper wort! *s$ HLL containing te7t of #anks prescri#ed format$ Signatures of customer s!ould matc! wit! t!at of computeri8ed national identit" card0 if not t!en a separate undertaking will #e o#tained on #anks prescri#es format and t!e same will #e aut!enticated #" introducer$ See anne ure anne ure

KE

 +wo passport si8e p!otograp!s reCuired if customer=s signatures are s!ak"$ ?L

 If customers signs in a s!ak" st"le or affi7 t!um# impression0 a separate indemnit" will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" t!e introducer$ In case national identit" card ((NI() does not contain a p!otograp!0 t!en in addition to (NI(0 an" ot!er document suc! as Dri/ing &icense etc t!at contains a p!otograp! is reCuired$ if customer does not !a/e an" ot!er /alid document w!ic! #ears p!otograp!0 t!en following documents will #e o#tainedI o A passport si8e p!otograp! dul" attested will #e o#tainedI o A cop" of (NI( dul" attested #" ga8etted officerBNa8im$ o A confirmation in writing to t!e effect t!at t!e indi/idual !a/e no ot!er document #earing p!otograp!$ After t!at I ga/e t!e #asic #anking (BBA) form0 and take signs from !er on t!e form and attac! all reCuired documents$ And also introduce !er wit! #ranc! manger Mr$ S!eik! Masood -la!ee w!o ok=s !er form after taking inter/iew from !er$ In account opening work was done on routinel" #asis e/er" da" "ou open accounts and gi/e c!eCue #ooks to t!e customers$ In account opening tasks was performed on routinel" #asis$ I also learned a#out ot!er t"pes of accounts at #ank Alfala! 'u5ranwala #ranc!$ Following are t!e accounts w!ic! I opened at t!is department$ ).). .). BUSINESS INDIVIDUALS ACCOUNTI +!is account is for #usiness indi/idual and firms$ &ike #usiness !as t!ree t"pes so same as t!is account can also #e opened #" Sole proprietors0 partners 2 companies$ So it is of K t"pes Sole proprietors!ip Account )artners!ip Account &imited compan" Account ).). .!. REJUIREMENTS FOR SOLE PROPRIETORSHIP ACCOUNT Attested cop" of NI( (New) of proprietor$ Declaration of proprtiors!ip on letter !ead$ Attested cop" of N+N certificate$ Business stamp s!ould #e affi7ed on e/er" signature$ Ne7t of kin of proprietor$

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 (NI( num#er of ne7t of 3in$ Signature of proprietor s!ould matc! wit! t!at of computeri8ed national identit" card0 if not t!en a separate undertaking will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" introducer$ Bank *eferences$ Accounts statements$ If proprietor signs in language ot!er t!an -nglis!0 an undertaking is reCuired on stamp paper wort! *s$ HLL containing te7t of #anks prescri#ed format$ If customers signs in a s!ak" st"le or affi7 t!um# impression0 a separate indemnit" will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" t!e introducer$ In case national identit" card ((NI() does not contain a p!otograp!0 t!en in addition to (NI(0 an" ot!er document suc! as Dri/ing &icense etc t!at contains a p!otograp! is reCuired$ if customer does not !a/e an" ot!er /alid document w!ic! #ears p!otograp!0 t!en following documents will #e o#tainedI o A passport si8e p!otograp! dul" attested will #e o#tainedI o A cop" of (NI( dul" attested #" ga8etted officerBNa8im$ o A confirmation in writing to t!e effect t!at t!e indi/idual !a/e no ot!er document #earing p!otograp!$ ).). .". REJUIREMENTS FOR PARTNERSHIP ACCOUNT Attested copies of NI(s (New) of all partners$ (ertified true cop" of partners!ip Deed (on stamp paper wort! *s$ 5LL)$ DDpartners!ip Deed s!ould #e attested #" Notar" pu#lic$ (op" of N+N certificate of firms as well as all partners$ )artners!ip Mandate (Banks )rescri#ed Format)$

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*eCuest &etter on firm=s letter !ead mentioning t!e personBpersons aut!ori8ed to operate t!e account$ Firms s!ould #e affi7 on e/er" signature$ All partners s!ould sign on #anks prescri#ed format for partners!ip in t!eir

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indi/idual capacit" (i$e$ Firms stamp s!ould not #e affi7ed wit! signatures on mandate)$ Signature of all applicants s!ould matc! wit! t!at of computeri8ed national identit" card0 if not t!en a separate undertaking will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" introducer$ )!otocop" of certificate of registration issued #" registrar of firms (onl" in case registered firms)$ (opies of mem#ers!ip certificates from concerned trade organi8ation0 if an"$ (opies of importBe7port registration if an" (onl" for trading firms)$ Balance s!eet (optional)$ Banks *eferences$ If an" partner signs in language ot!er t!an -nglis!0 an undertaking is reCuired on stamp paper wort! *s$ HLL containing te7t of #anks prescri#ed format$ +wo passport si8e p!otograp!s reCuired if signatures of an" partner are s!ak"$ If customers signs in a s!ak" st"le or affi7 t!um# impression0 a separate indemnit" will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" t!e introducer$ In case national identit" card ((NI() does not contain a p!otograp!0 t!en in addition to (NI(0 an" ot!er document suc! as Dri/ing &icense etc t!at contains a p!otograp! is reCuired$ if customer does not !a/e an" ot!er /alid document w!ic! #ears p!otograp!0 t!en following documents will #e o#tainedI o A passport si8e p!otograp! dul" attested will #e o#tainedI o A cop" of (NI( dul" attested #" ga8etted officerBNa8im$ o A confirmation in writing to t!e effect t!at t!e indi/idual !a/e no ot!er document #earing p!otograp!$ ).). .$. REJUIREMENTS FOR LIMITED COMPANY ACCOUNT Memorandum 2 Article of association$ DAttested #" S-()$ D(ompan" seal s!ould #e affi7 on #ot! memorandum 2 article of association$ Attested p!oto state cop" of certificate of incorporation$ (Attested #" S-())$

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 Attested p!oto cop" of latest =form AD2E=$ (Attested #" S-())$ &ist of Directors on compan"=s letter !ead$ Dunder signed #" t!e c!airman 2 sectar" of t!e compan"$ (op" of Board *esolution regarding account opening$ Dunder signed #" t!e c!airman 2 sectar" of t!e compan"$ Dcompan" seal s!ould #e affi7ed on *esolution$ Attested copies of NI(s (New) of all Directors$ (op" of Board *esolution (Banks prescri#ed form)$ Attested cop" of N+N certificate of compan" as well as all Directors$ Attested cop" of certificate of commencement of #usiness (in case of pu#lic limited compan" onl")$ *u##er stamp s!ould #e affi7ed on e/er" signature e7cept #anks prescri#ed resolution$ Signature of all applicants s!ould matc! wit! t!at of computeri8ed national identit" card0 if not t!en a separate undertaking will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" introducer$ Balance s!eet$ Banks *eferences$ If an" of directorsBaut!ori8ed signator" signs in language ot!er t!an -nglis!0 an undertaking is reCuired on stamp paper wort! *s$ HLL containing te7t of #anks prescri#ed format$ +wo passport si8e p!otograp!s reCuired if signatures of an" partner are s!ak"$ If customers signs in a s!ak" st"le or affi7 t!um# impression0 a separate indemnit" will #e o#tained on #anks prescri#ed format and t!e same will #e aut!enticated #" t!e introducer$ In case national identit" card ((NI() does not contain a p!otograp!0 t!en in addition to (NI(0 an" ot!er document suc! as Dri/ing &icense etc t!at contains a p!otograp! is reCuired$ if customer does not !a/e an" ot!er /alid document w!ic! #ears p!otograp!0 t!en following documents will #e o#tainedI o A passport si8e p!otograp! dul" attested will #e o#tainedI o A cop" of (NI( dul" attested #" ga8etted officerBNa8im$

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o A confirmation in writing to t!e effect t!at t!e indi/idual !a/e no ot!er document #earing p!otograp!$ ).). .%. REJUIREMENTS FOR CLUBSI SOCITIES AND ASSOSIATIONS ACCOUNTS (ertificate copies of a$ (ertificate of registration$ #$ B"DlawsBrules 2 regulations$ *egulation of t!e go/erning #od"Be7ecuti/e committee for opening of account aut!ori8ing t!e person (s) to operate t!e account$ An undertaking signed #" all t!e aut!ori8ed persons on #e!alf of t!e institution mentioning t!at w!en an" c!ange takes place in t!e persons aut!ori8ed to operate on t!e account0 t!e #anker will #e informed immediatel"$ (opies of (NI( of all mem#ers signing t!e Account %pening Form$ &ist of mem#ers of go/erning #od"Be7ecuti/e committee on letter !ead$ *u##er Stamp$ ).). .*. REJUIREMENTS FOR AGENTS ACCOUNTS (ertificate copies of power of Attorne" Attested cop" of NI( of t!e agent$ ).). .&. CNIC VERIFICATIONNAD*A /erification must attac! wit! t!e form as a pro/e eit!er t!is customer w!o want to open an account is )akistani or not$

?6

).).!. TYPES OF ACCOUNTS AT BAL GUJRANWALABA& opens t!e following accountsQ (urrent account (#ot! in foreign and local currenc") Sa/ing account (#ot! in foreign and local currenc") *o"al profit account (in )ak$ *s$)

).).!.'. CURRENT ACCOUNT -/er" #ank maintains t!e current account wit! its customersQ :A current account is running account w!ic! is continuousl" in operation #" t!e customer on all working da"s of t!e #ank;$ +!e customer wit!draws mone" from current account wit!out prior notice to t!e #ank$ In s!ort0 in current account0 t!e #anker incurs an o#ligation to !onors all t!e c!eCues drawn #" t!e customer so long as t!ere is enoug! mone" to credit of t!e client$ ).).!.). I/0e1e:0 2/ 5411e/0 a5524/0 +!e #anks don.t usuall" pa" an" interest on current account in local as well as foreign currenc"$ +!e amount can #e wit!drawn at an" time0 so t!e #ank can.t compl" t!ese funds due to fear of wit!drawal$ ).).!. . W>2 a1e 6/0e1e:0e3 6/ 2=e/6/g 5411e/0 a5524/0K +!e current account is operated #" traders0 #usiness companies0 institutions0 pu#lic #odies0 industrialists w!o 9is! to !a/e working capital in t!eir custod" &ike to recei/e and make pa"ments t!roug! c!eCues Are interested in keeping t!eir mone" liCuid and safe ,tili8e t!e agenc" ser/ices of t!e #ank freCuentl" ).).!.!. A3Ca/0age: 27 >aC6/g 5411e/0 a5524/0 +!e customer gets t!e following ad/antages on #e!alf of current accountQ +!e #ank collects properl" endorsed c!eCues on #e!alf of current account !olders +!e #ank ma" allow t!e facilit" of o/erdraft on prior arrangements to t!e trustwort!" customers$ &oans and ad/ances ma" #e sanctioned to t!e creditwort!" clients wit! ease$ %n line facilit" alternati/e of cas! transaction is also pro/ided to customers !a/ing min$ #alance of *s$5LL0 LLLBD in t!eir current account$

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).).!.". I/606a; 3e=2:60 +!e minimum initial deposit for current account in local currenc" in *s$HLLL0 w!ere as for maintain current account min$*s 5LLL is mustQ ot!erwise t!e #ank will take *s$2LL for not maintains account properl"$ Initial deposit in foreign currenc" current account is ,SO or ,3 pound 5LL$ Summing up0 t!e current account doesn.t earn #ut ser/es t!e cause of industr" trade and commerce$ ).).!.$SAVING ACCOUNT Sa/ing deposit account is an ideal account for t!ose w!o !a/e mone" to sa/e #ut cannot profita#l" in/est it an"w!ere else0 as amount is too small$ Sa/ing deposit is an important source of fund for commercial #anks$ It is opened to encourage t!rift among t!e persons of small means$ Sa/ing account is opened #ot! in local and foreign currenc"$ ).).!.%. W60>31aFa; 27 a<24/0 +!e depositors are normall" allowed to draw a limited amount of mone" onl" twice a week$ If a customer wants to wit!draw a large sum of mone"0 !e t!en !as to gi/e a prior notice of 6 to H5 da"s in writing to t!e #ank$ +!e #ank can safel" in/est t!e deposits of sa/ing account0 as it knows t!at onl" t!e customer wit!draws a small percentage of t!is account$ ).).!.*. I/0e1e:0 2/ :aC6/g a5524/0 %n )ak$ *s$ Account t!e #ank usuall" pa"s interest according to prescri#ed rates #" t!e central #ank$ +!is amount is credited to t!e customer.s account after e/er" mont!s$ +!e rate doesn.t remain t!e same #ut fluctuates due to man" reasons e$g$ conditions of t!e #ank0 #ank.s total deposit.s position0 inflationar" and deflationar" powers in t!e econom" etc$ +!e rate of interest on foreign account is as followsQ ,SO sa/ing account (new) ,3 pound sa/ing account (new) 2$25P 2$LLP

9!ile interest rate on t!e old foreign currenc" accounts is H$LLP #ot! for initial deposit0 w!ile in foreign currenc" account t!e minimum amount is 5LLO$

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).).!.&. ROYAL PROFIT ACCOUNT *o"al profit account is 5ust like t!e sa/ing account wit! t!e following ma5or differencesQ +!e ro"al profit account is opened onl" in local currenc"$ Minimum #alance for opening ro"al profit account is *s$25LLLB$ *ate of profit is !ig!er$ Following are t!e accounts w!ic! are mostl" open at 'u5ranwala #ranc! #ut during m" interns!ip most of sa/ing accounts closed #ecause on customer demand and current accounts #ecause nill #alance in t!eir accounts$

5L

). . PROCEDURE OF ACCOUNT OPENING ). .'. STEP '#REASON TO OPEN THE ALC9!en a person approac!es t!e #ank to get an AB( opened in !isB!er name wit! a reCuest0 t!e first step is :knowing t!e reason; i$e$ w!" does !eBs!e want to open t!e AB($ ). .). STEP II#THE ACCOUNT OPENING FORM+!e person w!o is desirous of opening on account wit! t!e #ank !as to fill in :+!e Account %pening Form;$ +!e client must #ring !is own original National Identit" (ard$ 4e is gi/en an account opening form to fill in$ If !eBs!e wants to open a (urrent0 Foreign currenc" or )&S AB(0 t!en !eBs!e !a/e to fill a form according to t!e account$ An" person0 firm a #od" corporate t!at can enter into contract can open an account wit! t!e #ank$ ). . . STEP III#COMPLETION OF THE FORM+!e applicant must fill in t!e form properl"$ +!ere s!ould #e no o/erwriting or cutting$ 4e !as to write !is name0 address0 contact num#er and t!e amount !e !as to deposit at t!e time of opening an account$ For )&S account t!e limit of initial deposit is *s$5LL$ for current account t!e limit of initial deposit is *s$ HLLLL and for foreign currenc" accounts t!e limit of initial deposit is ,s$2LLO and 2LL )ounds$ +!e applicant !as to declare in t!e form t!at !eBs!e s!all compl" wit! t!e #ank rules0 w!ic! are enforced from time to time for t!e conduct of t!e account$ %ne signature of t!e person is taken on t!e face of t!e form and one is taken on t!e #ackside$ +!ese signatures s!ould #e usual signatures and !e would operate t!e account wit! t!em in future$ ). .!. STEP IV#INTRODUCTION+!e prospecti/e customer is to pro/ide !is introduction to t!e #ank eit!er from t!e old customer of t!e #ank or from t!e person known to t!e #ank$ +!e introducer or reference /erifies t!e integrit"0 c!aracter0 !onest" and good will of t!e intending customer on t!e application form$ +!e signatures of t!e introducer must #e present on t!e form ot!erwise t!e form will #e considered as incomplete$ ). .". STEP V# SPECIMEN SIGNATURE CARD+!e signatures of t!e client are o#tained on a Specimen Signature (ard$ +!ese cards are o#tained in duplicate wit! two signatures on eac! card from t!e customer$ +!ese 5H

Specimen Signature (ards (SS(s) are t!en scanned in t!e computer$ -/er" time a c!eCue is recei/ed for a pa"ment from t!e client0 t!e signature on t!e c!eCue are /erified #" comparing t!em wit! t!e S$S$ (ard$ see anne ure

). .$. STEP VI#ACCOUNT NUMBER9!en all t!e formalities are completed t!en t!e final appro/al of account !as to #e taken from t!e Branc! Manager$ After o#taining appro/al of t!e #ranc! manager an account num#er is allotted to t!e customer all t!e information is entered into t!e computer$ +!en t!at account num#er is printed on t!e c!eCue#ook0 S$S$cards and account opening form$ ). .%. STEP VII# ISSUANCE OF A CHEJUEBOOK%nce a person !as opened t!e account0 t!e ne7t important p!ase is :acCuiring t!e c!eCue #ook;$ For t!is0 t!e #ank issues !im a :reCuisition slip; on w!ic! t!e AB( !older mentions !is AB( title0 AB( num#er0 t"pe of account0 t!e num#er of pages needed in t!e c!eCue #ook along wit! !is signatures$ +!e account num#er and t!e name of t!e client0 from t!e reCuisition slips0 are t!en -D mailed to t!e 4ead %ffice 3arac!i$ It.s to #e mailed on Frida"s Z #efore H2IKLpm0 on Saturda"s Z #efore H2ILLpm0 and0 on t!e rest of t!e da"s Z #efore HIKLpm$ Bank recei/es

52

t!e reCuired c!eCue #ooks t!e /er" ne7t da" it makes t!e reCuest (normall")$ %n receipt of c!eCue #ooks from 4%0 t!e designated officer immediatel" sends a confirmation s!eet #ack to 4%0 t!roug! -Dmail0 on w!ic! t!e names and num#ers of all sent c!eCue#ook are mentioned$ +!e officer t!en issues c!eCue#ook to customers0 taking t!eir signs on anot!er cop" of t!at /er" s!eet (sent to 4%) against t!eir names and stamp t!e signs :/erified;$ +!is s!eet is kept in t!e folder named :reCuest for c!eCue#ook;$ Anot!er cop" (w!ic! is t!e Krd use of t!is s!eet) is kept for /ouc!er records i$e$ t!e c!eCue #ook c!arges$ +!e c!eCue #ook can #e of pages containing t!e num#ersI HL0 25 and 5L$ +!ere.s a reCuisition slip in e/er" new c!eCue #ook to reCuest t!e ne7t one$ Bank c!arges *s$ 5 per leaf and /ouc!ers are prepared w!ere :c!eCue#ook.s c!arge recorded ((r); wit! t!e rate :5Vtotal num#er of lea/esVtotal #ooks; and :customer aBc (Dr); wit! t!e rate :5Vtotal num#er of leafs;$ And0 :stationar" securit" AB( (Dr); and :stationar" pa"a#le ((r); wit! t!e ratio of 2$KL$ Bank takes its s!are at ratio of 2$6L$ +!e e7pir" period of a c!eCue #ook is K mont!s$ A person can sign t!e records and take awa" !isB!er c!eCue #ook$ But if t!e entitled customer is una#le to recei/e t!e c!eCue#ook.s !imB!erself0 !eBs!e can aut!ori8e some#od" else to recei/e t!e c!eCue #ook on !isB!er #e!alf$ In t!is case0 Aut!orit" letter0 Krd B aut!ori8ed person.s (NI(0 along wit! :/eris"s; (w!ic! is cop" of Krd person.s NI( from NAD*A) cop" and reCuisition slip are taken$ +o make t!e transaction safer0 :c!eCue #ook deli/er" of AB(; intimation or t!e :acknowledgement letter; is also issued t!at.s signed and returned to #ank #" t!e entitled customerBaccount !older to acknowledge receipt$ ). .*. STEP VIII (A) # ENTRY OF A CHEJUEBOOKBefore issuance of a c!eCue#ook0 t!e emplo"ee performs certain functions$ +!e" includeI Stamping e/er" leaf wit! specific AB( num#er$ -nters it in t!e c!eCue#ook issue register$ (!eck w!et!er or not a senior officer /erifies t!e signatures0 if no t!en first !e gets t!em /erified$ After entr" in t!e manual register0 t!e emplo"ee issues t!e c!eCue#ook to t!e AB( !older after !isB!er signature on t!e register$

5K

). .&. STEP VIII (B) # THE ONLINE RECORD%nce a c!eCue#ook.s issued t!e officer immediatel" !as to get t!e c!eCue#ook.s serial num#er entered into t!e s"stem$ %t!erwise t!e customers won.t #e a#le to get t!e c!eCue cas!ed$ Software0 named :#ank smart;0 is #eing used to keep t!e record of customer.s transactions. ). .'(. STEP IX# FILLING OF ACCOUNT OPENING FORMSFor current and sa/ing account0 separate files are maintained in w!ic! t!e forms are pasted in numerical order and kept under lock and ke" in fireproof steel or safe$ +!is is #ecause t!ese forms are t!e #asic documents of t!e contract wit! t!e customer$ ). .''. STEP IX# MAINTAINING THE COMPUTER RECORDAfter opening of account0 e/er" information regarding t!e account is entered into t!e computer$ (urrentl"0 a program named [Bank smart. is #eing used for t!is purpose$ *ecord of all t!e transactions regarding t!e account of a customer is kept updated in t!e computer$ 2.3.12. KNOW YOUR CUSTOMER FORMAlong wit! an account opening form an officer also fills a Cuestionnaire form known as !"now #our $ustomer Form%(3G()$ In t!is form some additional information a#out t!e customer is recorded$ +!is form is an e/ident and s!ows t!at t!e accountDopening officer !as personall" met t!e client$ 3G( is anot!er form same as account opening form #ut it contains few more details w!ic! !elp t!e #ank to know its customer$ +!at is w!" it is known as 3now Gour (ustomer form$ +!is is t!e form pro/es t!at t!e documents and details gi/en #" t!e customer are /erifies and correct$ After /erif"ing t!e details like mont!l" income0 address0 line of #usiness0 telep!one num#er and t!e ot!er details t!e #ank allows t!e customer to #e a part of #ank$ ).!. ACCOUNT CLOSING).!.'. TF2 0?=e: 27 a5524/0 5;2:6/g %wn customer reCuest Due to Nill #alance

A customer comes and told I want to close m" account so I ga/e !im account closing form and told !im reCuirements for closing an account gi/e 2 ask w!" "ou want to close

5?

"our account0 !e ask me I !a/e no need to continue t!e account$ +!ere are no c!arges in some conditions w!en a customer wants to close t!eir account$ See anne ure

55

After filling t!e form I told !im confirms t!e form from Mr$ Malik 1a/ed w!o is t!e operations manager and !e !as t!e aut!orit" to close or acti/ate t!e account or stop t!e pa"ment$ After t!at Mr$ Malik took inter/iew from t!e customer 2 closes t!eir account$ ).!.). PROCEDURE FOR CLOSING AN ACCOUNT\+!e procedure followed for t!e purpose of closure of an account is descri#ed in t!e following steps$ +!e customer w!o wis!es to close an account first !as gi/en an application0 dul" signed on t!e preDprinted application of t!e #ank$ +!e client !as to attac! t!is application wit! t!e lia#ilit" form (e7plained #elow)$ +!e customer can also gi/e an application on plain paper0 #ut correct signatures are /er" necessar"$ +!en it !as to #e made sure t!at if t!e account to #e closed is a sa/ing or foreign currenc" account t!en t!e account #alance #efore closing s!ould #e 8ero$ In case of t!ese t"pes of accounts t!e #ank does not take an" closing c!arges$ If a client wis!es to close a current account t!en t!e #ank c!arges *s$ H5L0 so at t!e time of closing t!e #alance s!ould #e *s$ H5L$ Along wit! t!e application to close t!e account customer=s c!eCue #ook is also recei/ed from !im and t!en it is destro"ed in order to pre/ent an" misuse in t!e future$ A lia#ilit" form is filled and sent to t!e +rade Finance Department and credit Department in order to c!eck t!at t!e customer does not owe t!e #ank a single penn" in an" regard$ A de#it /ouc!er and a credit /ouc!er are also attac!ed to t!e lia#ilit" form$ 9!en #ot! of t!ese departments appro/e t!at t!e customer does not owe an" mone" to t!e #ank and t!e form is returned to t!e account opening department0 t!en original account opening form pasted in t!e ledger w!en t!e account was opened is marked =account closed= along wit! t!e date on w!ic! it is marked$ %ne t!ing !as to #e taken into immediate consideration t!at t!e account num#er allotted to t!e client (w!o !as to close !is account)0 after closure of t!e account #ecomes unless and is not allotted to an" one in t!e future$ After appro/al of t!e lia#ilit" form0 it is sent to eit!er t!e foreign currenc" department or t!e cas! department0 as t!e case ma" #e so t!at t!e officer w!o scanned it in t!e first place could return t!e specimen signature card to t!e accountDopening department$

%nce t!e S$S$ (ard is recei/ed #ack from t!e concerned official t!en t!e lia#ilit" form0 t!e client=s application along wit! t!e specimen signature card is passed in t!e ledger rig!t along side t!e original account opening form$ +!e form !as to #e pasted wit! t!e original account opening form e/en if t!e account was opened a decade ago$ In t!e computer as well all t!e entries and records related to t!at particular account are permanentl" deleted #" using t!e =close account= option$ ).!. . IMPORTANT DOCUMENTS USEDLIABILITY FORM+!is particular form is used w!en an account is to #e closed$ +!e staff of account opening department0 after filling in t!e name and account num#er of t!e client forwards t!is form to t!e credit department and t!e trade finance department w!o upon receipt of suc! lia#ilit" form make reCuired securit" so as to c!eck w!et!er or not t!e customer owes some mone" to t!e #ank or not$ ).!.!. STOP PAYMENTI also learned !ow to stop t!e pa"ment on customer=s reCuest$ %ne ID card cop" is reCuired from t!e customer 2 and attac! t!e stamp of original seeing on ID card$ +!e c!arge of stop pa"ment of one c!eCue is *s$ 2LL$ w!ole c!eCue #ook stop pa"ment is 55L

56

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).!.". CHEJUE BOOKS RECIVING A ISSUANCEAfter opening an AB( wit! t!e #ank0 t!e AB( !older once makes a reCuest in t!e name of #ank for t!e issuance of a c!eCue #ook$ +!e AB( !older mentions title of AB(0 AB( num#er0 sign it properl" and mentions t!e no of lea/es !eBs!e reCuires$ Normall" BA& issues a c!eCues #ook !a/ing at least 25 or 5L lea/es$ -/er" c!eCues #ook also contains one leaf t!at is used for anot!er of a c!eCues #ook$ It was routine work at account opening department t!at customer ga/e reCuest t!at is known as c!eCue #ook reCuisition slip for new c!eCue #ooks$ See anne ure

9!en customer gi/e reCuest for new c!eCue #ook it is Cualit" of #ank Alfala! customer get c!eCue #ook from ne7t da"0 t!at issues from !ead office t!at is in 3arac!i$ After collecting t!e c!eCue #ook slips all reCuests mail to main office #efore 2 o clock0 and enters t!e information in s"stem$ It was an important task at account opening department t!at was issue c!eCues #ook to customers on t!eir reCuest$ It was /er" sensi#le 2 responsi#le task at t!at department0 #ecause t!eir ma" #e conduct different kinds of frauds due to irresponsi#ilit"$

5E

).!.$. IN CASE OF CHEJUE BOOK LOST+!ere was man" cases regarding c!eCues #ooks lost of customers0 in case of c!eCues #ook lost of a customer following procedure must #e followed #" a customer0 Inform to t!e Account opening Inc!arge0 M" c!eCue #ook was lost 2 #ring a police report of c!eCues #ook lost$ %ne ID card cop" is also attac!ed wit! t!e report and IND-MI+G *-N,-S+$ See anne ure

).!.%. MANUAL CHEJUESA manual (!eCues #ook is issued to t!e customer !isB!er reCuest of 25 lea/es$ After issuing t!e new c!eCues #ook to t!e customer it was enter in t!e register as a record$ +!e c!arges of stop all c!eCues #ook is *s$5LL 2 for stoppage of single c!eCue is *s$2LL$ in case of lost of single c!eCue t!e following procedure is follow0 Inform to t!e Inc!arge ID card cop" Stop pa"ment reCuest In case of loss of a c!eCue0 to stop a c!eCue from encas!ment0 t!e rules sa" t!e following 2.!.%.'. (N2 :=e56765 213e1) (ustomer !as to come personall" wit! an application to pre/ent t!e c!eCue from encas!ment *s$ 2HL0 per complaint of a c!eCue *s$ 52L0 on loss of complete c!eCue #ook0 after filing an *A)A+$

).!.%.). O7 1e@46:6062/ :;6=In t!is case t!e rules sa" t!e followingI Indemnities for *eCuisition slip loss$ Indemnit" is and undertakingBreCuest in case of loss of reCuisition slip t!at is resulted in issuance of Form B$ Application to issue Form B for *s$ HL5$ Issuance of Form B (reCuisition slip)

).!.*. RECEIVE THE CHEJUE BOOK BY OTHER PERSON ON BEHALF OF ACCOUNT HOLDERIf a customer was /er" #us" and don.t !a/e time to recei/e c!eCues #ook so !eBs!e gi/e aut!orit" to gi/e c!eCue #ook to t!is person$ See anne ure

ACKNOWLEDGEMENT-

9!en a person want to recei/e c!eCues #ook on #e!alf of account !older0 t!en t!at ?

person acknowledge0 t!at I recei/e c!eCues #ook on #e!alf of account !older$ ).!.&. ACTIVATION OF DORMANT ACCOUNTW>a0 6: 321<a/0 a5524/0K A dormant account is t!at if a customer cant doing t!e transaction in last mont!s0 or if a customer not !a/e enoug! amount in !isB!er account t!at account #ecomes t!e dormant account$ &n m" interns!ip period it was routine work to acti/ate so man" dormant accounts$ (ustomer ID card is must to acti/ate t!e account on reCuest$ It is necessar" a customer must come for acti/ation wit! amount according to t!e reCuirement of t!at account$

).!.'(. CHANGE OF ADDRESS A TELEPHONEIf a customer wants to c!ange t!e address or telep!one t!en first of all fill t!is 2 attac! t!e cop" of !isB!er ID card. See anne ure +!is 2 attac! t!e cop" of !isB!er ID card. See anne ure

).!.''. CHEJUE FILLING It was anot!er dut" I !a/e e/er done during m" interns!ip period$ +o fill a c!eCue reCuires full attention on w!at "ou are writing$ +!e account !olders w!o are illiterate and ne/er know !ow to fill t!e c!eCue ask for !elp from t!e customer ser/ice officer$ 9!ile filling a c!eCue on #e!alf of customers I must !ad to c!eck t!e following t!ingsI H$ Date of wit!drawing amount 2$ 9riting e7act amount K$ No cutting and o/er writing ?$ Signatures or t!um# impressions on rig!t place 5$ (NI( num#er must #e mentioned in t!e #ack side of c!eCue $ 9!o is t!e #earer ).!.'). PERSONAL EXPERIENCE OF FILLING CHEJUES 9!ile filling t!e contents of c!eCue I was /er" attenti/e a#out w!at I am writing on t!e c!eCue$ It s!ould #e written wit! proper attention t!at w!at is t!e date and w!at amount t!e customer wants to wit!draw$ Because #" increasing or decreasing t!e num#er of 8ero in t!e amount column t!e amount can #e totall" c!anged and t!e customer will !a/e to #ear t!e pro#lem$ It sometimes !appened wit! me t!at I filled t!e c!eCue wrongl" t!en m" in c!arge instructed me to cut t!e written word and take sign of t!e customer in cutting place$ M" wa" of writing amount is like ]^^^^^^BD0 and also I used to write t!e num#ers /er" close to eac! ot!er so t!at t!e person w!o came to wit!draw t!e amount could not add an" ot!er num#er$ So it was a simple task #ut reCuires proper attention of t!e person$

).". M2/e? G1a<I also work for few da"s Mone" 'ram$ Mr$ Faisal0 Inc!arge of Mone" 'ram0 welcomed me in !is department$ For !is0 I would 5ust sa"0 t!at I did not find suc! a !elpful and cooperati/e person in m" career$ In t!at0 I worked for few da"s of m" interns!ip program$ %ne ma5or difference t!at I o#ser/ed in t!is department and ot!er departments was t!e difference in t!e nature of work$ 4ere0 I !a/e tried to descri#e m" e7perience and o#ser/ation0 Mone" 'ram department$ ).".'. F61:0 27 a;; F>a0 6: <2/e? g1a<K Mone" gram is software0 t!roug! w!ic! we get foreign remittances wit!out an" Account _0 onl" 5ust know t!e #asic information from customer w!o wants to deposit mone" P125e341e Name of t!e sender ID card cop" of t!e recei/er *ecei/er 2 sender (ontact num#ers (urrenc" Date and time

All t!ese information must #e fulfilled$

6L

6H

).$. LOCKERS+o keep t!e /alua#les safe0 BA& also pro/ides t!e &%(3-*S facilit" to its AB( !oldersAso0 it needs no special /erification and documentation procedures$ It is important to first time c!eck #" t!e officer of lockers w!at customer put in locker$ If customer !as no account at BA& t!en it must pro/ide ID card cop" wit! attested B form$ +!ese lockers are in /arious si8es and definitel" on /arious rates$ ).$.'. SI+ES AND RATES OF LOCKERS&ockers are a/aila#le in t!e following rates and si8esI SMA&& Z *s$ HLLL per "ear

M-DI,M Z *s$ H5LL per "ear &A*'- Z *s$ 25LL per "ear

Bank deducts 5P Federal -7cise Dut" (F-D) on t!is amount$ ).$.). MAINTAINING THE LOCKERS+!e locker maintenance in/ol/es t!ree ma5or issuesI &ocker Map +!at presents t!e position of eac! locker$ &ocker (ontrol &ist )resents0 w!ic! locker !as #een issued to w!om and against w!ic! ke"$ &ocker )osition It makes t!e furt!er issuance of lockers easier #" demonstrating t!e issued and remaining num#ers and t"pes of lockers$ ).$. . DOCUMENTS REJUIRED *eCuest Form SS card &ocker Form 62

ID card of customer +!e customer first contacts t!e official locker operator$ Signs on locker attendance register 'ets to !isB!er own locker after !a/ing t!at 4-AFG door opened$ +!e #ank ke" along wit! t!e customer ke" is used to open t!e locker$ Meanw!ile0 t!e officer lea/es t!e room$ +!e customer operates t!e locker and t!en locks it wit! !isB!er own ke" alone$

).$.!. OPERATING THE LOCKERS-

).$.". LOSS OF KEYSIf a person loses !isB!er ke"s0 w!ic! results in #reaking t!e lockers0 #ank fines !im *s$ HLLL and all t!e #reaking c!arges are to #e #orne #" t!e customer !imself$ ).$.%. INSURANCE&ockers are insured upto L$25 million$ ).$.*. LOCKER SI+ES #" #" H2 H2 #" H2

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).%. ACCOUNTS DEPARTMENTAfter account opening department I rotate towards t!e account department Mr$ Faisal is t!e !ead of t!e accounts department in t!is department I 5ust touc! t!e procedure of t!e accounts #ecause of t!e closing reports and t!e" must #e complete t!em #efore t!eir audit0 Miss 4ina assist me little #it working of t!is department$ +o do work in t!is department it reCuired a lot of time #ut I !ad s!orter time so I learn little #it$ First da" w!en I mo/e towards t!is department Mr$ Faisal and Miss 4ina welcomed me and told me a#out t!e dail" task of accounts department0 and gi/e me acti/it" of affairs to c!eck and marked t!e amounts of eac! department to know t!e dail" working of t!e w!ole #ranc!$ S!e also told me a#out w!at statements s!e makes at t!e end of t!e eac! mont!Q s!e makes t!e following ratio for #ank$ But s!e doesn.t tell me a#out !ow to calculate t!em #ecause s!e said t!ese ratios are calculated in our #anks software named as Bank Alfala! SMA*+$ So internees are not allowed to use it s!e also told me t!at we must #e report in e/er" morning t!e dail" position of t!e #ranc! to t!e centrali8ed$ ).%.'. M2/0> e/3 S0a0e<e/0: Assets 2 lia#ilities %t!er assets 2 lia#ilities *ate of return Deposit a#out K million Nualit" assurance #alancing Mandator" lea/es report Mont!l" performance re/iew report

During m" interns!ip in accounts department I learn following t!ings not in detail #ut followings are according to m" learning$ +!e accounts department deals wit! /arious routine acti/ities for t!e #ank$ +!e main acti/ities performed #" it are Budgeting *eporting Maintenance 2 depreciation of fi7ed assets

65

Miscellaneous function

).%.). BUDGETING Accounts department of a #ank Alfala!0 for a makes #udget for t!e #ranc!$ )rocedure +!e #udget is #ased on forecasting t!roug! past performance$ ).%.).'. P125e341e First of all0 t!e" re/iew w!at its sources of funds are and w!ere it can utili8e t!ese fundsY +!e main sources of t!e #ank Alfala! are deposits0 securities issued #" t!e #ank0 #orrowing from ot!er #anks0 #orrowing from SB)0 #ank.s paidDup capital0 its reser/e fund0 profit generated #" t!e #ank$ +!e #ank ma" emplo" t!ese funds in lending to ot!ers at a !ig! rate of markDup$ In/estment in securities0 placement in interD#ank markets etc$ It also takes into account t!e income from ot!er sources0 cost of funds0 administrati/e e7penses0 and utilities e7penses$ +!en t!e #udget is su#mitted to t!e !ead office for recommendation and modification$ Mont!l" #udget meeting is !eld #" #ranc! managers to anal"8e t!e mont!l" performance$ Budget and actual performances are emplo"ed and /ariance is computed for anal"sis$ Fariance can #e negati/e or positi/e$ Fariance does not mean t!at it will !a/e positi/e effect on t!e o/erall profita#ilit" e$g$ positi/e increase in deposits is not alwa"s coupled wit! positi/e increase in ad/ances$ +!e management will t!en dri/e t!e reasons for t!e /ariance and take remedial measures to ac!ie/e t!e targets$ ).%. . REPORTING +!e accounts department in t!e form of reports clu#s and details of /arious departments toget!er0 -ac! and e/er" minute detail is pro/ided in weekl"0 mont!l" and annual reports$ +!e reports are su#mitted to !ead office0 SB) and to t!e go/ernment$ ).%. .'. K6/3: 27 Re=210: Following reports are prepared #" t!e accounts department on dail" #asis$ Statement of affairs 6

Income 2 e7penditure New F(G report *o"al profit report Su#sidiar" statement (urrenc" wise deposits report Stationar" reports

Following are t!e reports t!at are prepared on t!e #asis of reports granted from mainframe$ +!ese are /er" important for proper anal"sis and feed#ack$ ).%. .). Da6;? a3Ca/5e a/3 3e=2:60 =2:6062/ Dail" e7c!ange position Dail" fund management

).%. . . Ma6/0a6/6/g 27 76Be3 a::e0: A 0>e61 De=1e56a062/ Accounts department maintains t!e record of all t!e assets and c!arges depreciation on t!em$ Department prepares asset purc!ase report and asset sale report after e/er" mont!s t!at !elps in c!anging t!e depreciation$ It is calculated on mont!l" #asis and c!arged "earl"$ Bank Alfala! does not onl" depreciate t!e e7isting assets #ut also t!e assets #ut also t!e assets transferred in and transferred out$ ).%. .!. M6:5e;;a/e24: 74/5062/+!e accounts department also performs some ot!er miscellaneous functionsI Dail" acti/it" c!ecking *econciliation statements (losing entries Foreign e7c!ange forward transaction

).%. .". Da6;? A506C60? C>e596/g +!e accounts department t!e /ouc!ers wit! dail" acti/it" report generated #" t!e computer$ +!e /ouc!ers are t!en sorted out into #undles according to t!eir categories and comparing wit! t!e acti/it" report c!ecks t!e posting of transaction$ ).%. .$. Re52/56;6a062/ :0a0e<e/0:+!e #ank prepares reconciliation statement wit! !ead office and SB)$ ).%. .%. Hea3 27765e

66

*econciliation wit! !ead office is done in reconciliation department$ +!e #ranc!es sent out t!e !ead office$ +!e" c!eck t!e posting of all t!e entries if outstanding0 w!ic! !as not #een posted #" #ranc! or !ead office$ +!e reconciliation is carried out in t!e !ead office and accounts department !andles Cuarries$ ).%. .*. S0a0e Ba/9 27 Pa96:0a/ +!e SB) keeps t!e record of e/er" sc!eduled #ank$ +!e #ank statements and statements of SB) are reconciled on dail" #asis$ *econciliation is #asicall" setting of outstanding entries$ +!e reconciliation statement contains two sides$ %ne contains entries originated from #ank #ut not responded #" SB) and on t!e ot!er side entries originated #" SB) #ut not responded #" #ank$ ).%. .&. C;2:6/g E/016e:Accounts department also passes t!e closing entries on mont!l"0 ).%. .'(. F21e6g/ EB5>a/ge F21Fa13 T1a/:a5062/ In t!e past0 t!e #anks !as to keep t!eir foreign e7c!ange wit! SB) on t!e agreement t!at SB) will purc!ase t!e foreign e7c!ange on #ook rate and c!arge a fee for co/ering t!e risk$ +!is w!ole transaction was known as foreign transaction$ Now t!is facilit" is not a/aila#le$ +o #ank on new accounts0 #ut t!e" can a/ail it #" renewing t!eir limit on old accounts wit! SB)$ 9e can sa" t!at t!e accounts department !olds a sort of internal c!eck on t!e #ranc! relating to its income and e7penditures$ mont!l" and "earl" #ases to calculate t!e profit and anal"8e t!e o/erall performance for a certain period$

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).*. CREDIT DEPARTMENTAfter accounts department I spend m" fort! week in credits department Mr$ 4ama"oun *asool Mal!ee is t!e !ead of t!e (AD department credit administration department$ In credit department Mr$ ,sman and Mr$ Mu!ammad Ali deals wit! SM-.s and corporate department Mr$ Faisal deals wit! !ome loan and also assists Mu!ammad Ali$ Mr$ ,sman Anwer deals wit! mont!l" return and 'uarantees$ Mr$ S!a!8ad Naseem deals wit! Agri finance0 so m" mail focus on SM-s Mr$ Mal!ee !elps me a lot and told all t!e answers of m" Cuestion and also !elps in m" learning$ +!e credit department pla"s a ke" role in a #ank it earns considerate income in form of mark up on its ad/ances en5o"ed in t!is department /er" well$ +!e credit department !as #een su#Ddi/ided into two sections (redit Marketing (redit administration 2 Monitoring

).*.'. CREDIT MARKETING(redit marketing is t!e most important department of t!e #ank t!at actuall" finds t!e wa"s to utili8e t!e deposit t!at are #eneficial for t!e #ank and generate income for t!e #ank$ +!e credit marketing department consists of two sections SM-.s (orporate

).*.'.'. SME `small and medium enterprisea In t!is section0 we grant t!e loan to t!e small #usinesses0 w!ic! fall in t!e categor" of SM-$ According to )rudential *egulations of SM-I SM- means an entit"0 ideall" not pu#lic limited compan"0 w!ic! does not emplo" more t!an 25L persons (if it is manufacturing B ser/ices concern) and 5L persons (if it is trading concern) and also fulfills t!e following criteria of eit!er [a. and [c. or. #. and [c. as rele/antI a' b' c' A trading service concern with total assets at cost A manufacturing concern with total assets at cost Any concern ,trading, service or manufacturing' e cluding land and building upto (s. )* million. e cluding land and building upto (S +** million.

@L

with net sales not e ceeding (s. -** million as per latest financial statements. d) An individual, if he or she meets the above criteria, can also be categori.ed as an S/0.1 4ere t!e sale or turno/er is normall" up to t!ree million and t!e num#er of emplo"ees is fift" for ser/ice organi8ation and 25L for manufacturing organi8ation$ ).*.'.). CORPORATE +!e corporate section gi/es loan to industries and different companies according to wort! of t!e compan"$ ).*.'. . LOAN LIMIT Branc! is allowed to e7tend t!e credit from minimum of 5LL0LLL to ma7imum of 50LLL0LLL$ +!e Area office can e7tend t!e limit up to HL0LLL0LLL and a#o/e t!is limit t!e #ranc! !as to get appro/al from 4ead %ffice$ ).*.'.!. WORKING OF CREDIT MARKETING
CREDIT LINES

+!e #ank offers following credit lines to its wort!" customer$ Funded Facilit" Non Funded Facilit"

).*.'.". FUNDED FACILITY Funded lines are t!ose in w!ic! #ank directl" issues cas! to its customers and it consist of t!e following linesI (urrent Finance B*unning Finance ((F) +erm Finance &ocal Bill )urc!ase Foreign Bill )urc!ase Finance against Foreign Bills(FAFB) Finance against )acking (redit I0 II (FA)() Finance against Imported Merc!andise (FIM) Finance against +rust *eceipts (FA+*) (+F)

).*.'.$. NON#FUNDED FACILITY

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NonDFunded lines are t!ose in w!ic! #ank does not gi/e cas! to its customers0 rat!er it gi/es guarantee to t!e creditors of its customers$ +!ese lines consist of t!e followingI &etter of (redit `t!at can #e ,sance or Sig!t &etter of guarantee

).*.'.%. PRINCIPLE OF LENDING 3now "our customer )urpose of facilit" )rofita#ilit" Sources of repa"ments Securit"( (ollateral)

).*.'.*. GOLDEN PRINCIPLE OF LENDING +!e following points are considering t!e 'olden )rinciples for lendingI S!ort term loan Secured SelfD&iCuidation

).*.'.&. DOCUMENTS REJUIRED ).*.'.&.'. FOR SOLE PROPRIETOR AND PARTNERSHIP BBFS (Borrower.s Basic Facts S!eet) (op" of ID card )artners!ip deed (ollateral Documents +a7 *eturn Bank Statement for t!e last si7 mont!s

).*.'.&.). FOR THE COMPANY BORROWER In addition to a#o/e document t!e following documents are reCuired$ Memorandum of Association Article of Association Form 2E @2

I+ Form KL Faluation of propert" #eing offered as collateral (ollateral documents *eCuest letter )re/iousl" owned propert" to assess net wort!

).*.'.'(. TYPE OF BORROWERS ).*.'.''. INDIVIDUALS It consists of t!e followingI -7isting account !older Staff mem#ers (lose relati/es of t!e staff mem#ers -mplo"ee of ot!er #anks Sole proprietor s!ip )artner s!ip &imited compan" (lu#s and association Federal0 pro/isional and local go/t$ #odies +raders (ontractors and construction companies +ransport0 storage0 ware!ousing )ropert" dealers

).*.'.'). BUSINESS ACCOUNT

).*.'.' . OTHERS

).*.'.'!. INTERNAL DOCUMENTS It is also t!e responsi#ilit" of t!e credit marketing department to searc! for t!e potential customers #" /isiting t!e #usiness institutions and t!e indi/idual #usiness people$ 9!en a customer applies for credit0 t!e credit marketing department /erifies !is credit wort!iness0 ensures t!at all t!e reCuired documents are pro/ided0 and after #eing satisfied0 it refers t!e case to t!e #ranc! credit committee for appro/al$ Also t!e department prepares t!e case !istor" and t!e reCuired internal documents of t!e applicant$

@K

).*.'.'". CREDIT LINE PROPOSAL In t!is document t!e department mentions all t!e important information a#out t!e client and prepares t!e proposal for t!e loan$ (&) !as @ Sections (ustomer information )roposal Securities Brief customer profile Financial #riefs Account (onduct Attac!ments *ational 5ustification and consideration

).*.'.'$. TYPES OF PROPOSAL +!ere are t!ree t"pes of proposalsI NeF 4ere t!e client applies for loan for t!e first time$ ReC6:62/ In t!is t"pe of )roposal t!e client reCuests t!e #ank t!at !e wants to make certain c!anges in t!e credit limit$ Re/eFa; In t!is t!e client reCuest for t!e same limit after e7piring t!e date of pre/ious one In case of limit c!ange or amount c!ange t!e e7pir" date is c!anged #ut in case of markup c!ange t!e e7pir" date doesn.t c!ange$ ).*.'.'%. CATEGORI+ATION OF SECURITY (ategor" A in/ol/es tangi#le and releasa#le securit" (lien)$ 9!ereas0 (ategor" B in/ol/es non tangi#le and reali8a#le securit" (personal guarantee0 corporate guarantee) ).*.'.'*. COMPOSITE CREDIT LINE APPRAISAL In t!is regard0 t!e #ank c!ecks t!e credit wort!iness of t!e #orrower and anal"8es t!e #orrower on different aspects0 gi/es different rating to eac! and on t!e #asis of rating gi/es recommendations to t!e aut!orit"$ It consists of following sectionsI 'rade *isk inde7 le/el @?

(ondition +rends Aggregate score

G1a3e D In t!is section0 we gi/e different grades to different credit limits$ R6:9 I/3eB LeCe; D In t!is section0 we assign different points associated wit! different le/el of risk e$g$ H to lowest risk and HL to !ig!est one$ C2/36062/ D In t!is section0 we mention w!at is t!e condition of t!e #usiness on t!e #asis of different factors e$g$ e7cellent to t!e strong condition and poor to weakest condition$ T1e/3: D In t!is section0 we tell a#out t!e financial position of t!e firm$ Agg1ega0e S521e D %n t!e #asis of a#o/e we gi/e aggregate score to t!e different #orrowers$ SCORE ?H and a#o/e KH to ?L 2H to KL 2L and #elow CONDITION `@LPand a#o/ea ` LP to 6EPa `?HP to 5EPa `?L and #elowa Strong 'ood Fair )oor

So0 in t!is wa" we recommend t!e aut!orit" eit!er to accept or re5ect t!e proposal$ ).*.'.'&. APPRAISAL OF CREDIT PROPOSAL +!e constitution of #orrower and !is nationalit" +!e liCuidit" and relia#ilit" of t!e #orrower 4istor" of #orrower relations!ip wit! t!e #ank Status report from t!e #orrower pre/ious Bot!er #anks Management structure of t!e #orrower Nature of t!e #usiness +!e #orrower financial position Financial anal"sis Feasi#ilit" anal"sis )ro5ect anal"sis +!e profita#ilit" transaction wit! t!e #ank

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*epa"ment a#ilit" +!e securit" offered Documentation for considering credit facilit" Fisit report Status report ((IB report) (redit line proposal ((&)) Financial statements Stock inspection report (redit file Among all t!eses document t!e most important is t!e (IB report t!at s!ow t!e actual wort! and past loan data of customer$ (IB ((redit Information Bureau) depicts t!e followingI

%utstanding lia#ilit" (funded or non funded) %/erdue *eco/er" during t!e mont! Amount under litigation 9rite offs Num#er f time resc!eduling %utstanding lia#ilities (post dueEL da"s due K L da"s)

).*.'.)(. DURATION BASED CLASSIFICATION OF LOANS (redit loan can #e classified as$ S>210 Te1< D (o/ering a period of one "ear$ Me364< Te1< D (o/ering a period of two to t!ree "ears$ L2/g Te1< D (o/ering a period of more t!an t!ree "ears$ ).*.'.)'. MONITORING Monitoring is reCuired on t!e loan issued #" t!e #ank and it is different for long term and s!ort term mostl" it is of two t"pes0 monitoring #" means of practical /isit and #" means of anal"ses of financial statement$ 4ere in !ead office0 sanctioning of #ig loan are made as #ranc!es !a/e limited power to issue loan$ ).*.'.)). SECURITIES LCOLLATERAL

PRIME COLLATERAL It is consist of liCuid securities t!at can #e pledged or mortgage$ ).*.'.) . SECONDARY COLLATERAL +!ese securities are readil" con/erti#le to cas! t!at s!ould of more t!an adeCuate margin full" under #ank control !a/ing !ig! /alue t!at can wit! stand t!e /olatile market condition$ ).*.'.)!. TANGIBLE COLLATERAL +!e a/aila#ilit" of tangi#le collateral wit! necessar" margin and fair degree of marketa#ilit" under forced sale situation$ ).*.'.)". ATTRIBUTES OF GOOD TANGIBLE SECURITY Marketa#ilit" -as" assessment of /alue Sta#ilit" of /alue Ascertainment of titleBeas" transfera#ilit" of title Gield

Moreo/er0 following t!ings need to #e o#ser/edI ).*.'.)$. MANAGEMENT Management s!ould !a/e skill0 /ast e7perience and strong succession0 a#le to adapt c!ange$ ).*.'.)%. MARKET POSITION It s!ould #e market leader wit! t!e clear competiti/e edge$ ).*.'.)*. INDUSTRY BUSINESS SEGMENT CONDITION +raditionall" sta#le and esta#lis! industr" wit! strong future and growt! ).*.'.)&. CONDUCT OF OBLIGOR -7cellent Bcommitment are met in due time wit! e7ception$ ).*.'. (. DEFAULTERS Defaulters can #e of two t"pesI ).*.'. '. WILLFUL DEFAULTERS )eople deli#eratel" pledge securities w!ose /alues on documents are far more t!an t!eir actual wort!$ So w!en t!e person defaults0 #ank !as to face t!is fraudulent act and to #ear t!e loss$ @6 potential$ aggressi/e and

).*.'. ). RANDOM DEFAULTERS +!ese defaults are due to t!e situational factors$ An" accident can result in suc! default$ +o a/oid t!e losses from suc! defaults #ank make sure t!at it must !a/e eCual amount of #orrower assets so t!at it can reco/er its amount$ +o make t!is possi#le #ank usuall" go for pledges0 personal guarantee0 !"pot!ecation (c!arge on ot!er asset) and mortgage of propert"$ %nce t!e #orrower defaults !e will not #e granted loan again$ Bank will file a suit and to reco/er amount from t!e #orrower #ank can offer resc!eduling in t!e form t!at onl" t!e principal s!ould #e returned to t!e #ank in specific time period$ ).*.). CREDIT ADMINISTRATION DEPARTMENT (CAD) +!e c!airman of t!e Bank in !is re/iew for 2LLH annual report defines t!e credit polic" of Bank asI :(%NS-*FA+IF- G-+ DGNAMI( (*-DI+ )%&I(G; ).*.).'. OBJECTIVE +!e o/erall o#5ecti/e of t!e department is to pro/ide independent assurance to #ranc! management and !ead office credit monitoring di/ision t!at lending acti/ities are properl" controlled and monitored$ ).*.).). FUNCTIONS Documentation &odgment of documents and cas! collateral *eim#ursement audit certificate &imit input in #ank smart )ost dis#ursement monitoring Monitoring of irregular dou#tful and #ad de#ts *eporting

4ere it is necessar" t!at we must !a/e an o/er/iew of at least t!e most important documents t!at are rele/ant to t!is department$ ).*.).!. DOCUMENTATION Sanction Ad/ice Facilit" %ffer &etter 'eneral documentation

@@

Standard c!arge documents &egal document pertain to properties (as! collateral (!arge wit! S-() %t!er securities Insurance co/ers 'uarantees

).*.).". SANCTION ADVICE A t"pe of document in w!ic! t!e senior officer of #ank discuss all t!e confidential terms 2 condition t!at t!e demanded facilit" s!ould #e pro/ided or not$ ).*.).$. FACILITY OFFER LETTER 9!en it is decided t!at loan s!ould pro/ided to #orrower t!an #ranc! makes facilit" offer letter w!ic! e7plains t"pe of facilit" to #e pro/ided 2 document reCuired from #orrower according$ ).*.).%. GENERAL DOCUMENTS After facilit" offer letter general document are c!ecked t!ese document consist of (omplete account opening form Facilit" reCuest letter BBFS (IB (redit opinion Searc! report Audited Bunedited financial Borrower.s profile (!ecklist of state #ank regulation Board resolution to #orrow Memorandum and article of association

At t!is stage all t!e past records are c!ecked 2 /erified to ensure t!at past record of t!e #orrower matc!es wit! data pro/ided in reCuest letter$ +!e most important document0 w!ic! is c!ecked0 is (IB report$ In t!is report all t!e past loan of #orrower are s!owed

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and t!eir repa"ment record is also mentioned$ +!e compan" polices are also collected and t!eir aim is c!ecked t!at w!et!er t!e compan" is working in t!e same direction w!ic! it !as mentioned$ ).*.).*. STANDARD CHARGE DOCUMENT (F ((urrent Finance) +F (+erm Finance) FA)(I (Finance against )acking (redit) FAFB (Finance against Foreign Bill) &B) (&ocal Bill )urc!ase) FB) (Foreign Bill )urc!ase) S&A (Sig!t &etter %f (redit) ,&( (,sance &etter %f (redit) FIM (Finance against Import) FA+* (Finance against +rust *eceipt) ).*.).&. GUARANTEE LEGAL DOCUMENT PERTAINING TO PROPERTIES +itle deeds (op" of record of rig!ts (op" of mutation N-( )+I Aks S!a5ra Site plan Faluation Site /isit report )ower of attorne" Agreement to create mortgage +oken mortgage )re dis#ursement law"ers opinion )erfection certificate of law"er

EL

+!ese all documents are taken from #orrower 2 #ank make a file of t!ese documents$ +!ese documents are /er" important #ecause if at an" time in future #ank !as to take legal action against #orrower t!en #ank is well aware t!at w!o are t!e owners or partners of t!e compan"0 w!ic! propert" is mortgaged and t!ese all t!e t!ings are pro/ided to #ank own law"er w!ic! finall" decided t!at is e/er"t!ing rig!t and !e make a certificate or #orrower can #ring t!is certificate !imself from t!e recommended law"er of #ank$ ).*.).'(. GUARANTEES )ersonal guarantees of #orrower )ersonal guarantees of mortgagors (ounter guarantees (ross corporate guarantees 'uarantees are most important t!ing #ecause in t!is document it is written t!at w!o is responsi#le in case of default$ )ersonal 'uarantees are considered most important #ecause it mentions t!at t!e guarantor !as lia#ilit" to pa" #ank.s mone"$

EH

E2

).&. TRADE DEPARTEMNTAfter working in credit department for one week0 I was ad/ised #" Mr$Malik 1a/ed0 Manager %perations0 t!at I s!ould mo/e on to +rade Finance department$ I was muc! pleased to !ear t!is as I !ad a great desire to work and learn somet!ing regarding foreign trade operations$ So0 I was sent to Miss$ Saira (!ud!ar"0 Inc!arge trade finance$ Mr$ Asim assists Miss Saira #ot! were /er" kind persons and told me a lot a#out -7ports$ Alt!oug! H 2 !alf week period was /er" small to get knowledge of w!ole t!is department #ut still t!e" e7plained me e/er"t!ing t!at t!e" can in t!is s!ort span of time$

).&.'HT1a3e F6/a/5e DEPARTMENT HIERARCHYH

Miss SAI*A (4A,DA*G T1a3e Ma/age1

T1a3e O7765e Mr$ Asim Miss Saira is t!e !ead of t!is department and c!ecks t!e acti/ities of t!e import 2 e7port departments$ ).&.). EXPORT OPERATIONSDuring t!e one week in trade finance department0 I was muc! desirous to know t!at !ow t!e e7port transactions are carried out t!roug! #ank$ +!e e7port transactions in BA& '$+ *oad were not of suc! e7tensi/e nature as imports due t!at specific area$ ).&. . CONDITIONS FOR EXPORTER: +!ere are certain conditions t!at a person must fulfill to #ecome an e7porter$ H) 2) +!e person must #e an account !older of BA&$ No one can e7port an" commodit" until and unless !eBs!e is a )akistani and !as a /alid e7port registration wit! t!e -)B (-7port )romotion Bureau)$ K) +!e person must process a /alid mem#ers!ip certificate of +rade EK

%rgani8ation0 licensed and recogni8ed #" Federal 'o/ernment like a (!am#er of (ommerce$ ?) 5) +!e person must possess a /alid N+N (National +a7 No$) certificate$ A person cannot e7port an" good unless !e files a Form - (- stands for e7ports) wit! !is application to t!e #ank$ +!e form - must #e filled in writing and all specifications stipulated on t!e form0 must #e met$ ) +!e person must !a/e t!e Sales +a7 *egistration (ertificate$ ).&.!. COMPLETE EXPORT CYCLE +!e process of e7port starts wit! t!e receipt of t!e letter of credit (or contract) #" t!e #ank$ +!e issuing #ank sends t!e &B( to BA& '$+ *oad t!roug! t!e ad/ising #ank$ ,pon receipt of &B(0 an intimation letter is prepared and is sent to t!e #eneficiar" of t!e &B(0 ad/ising !im t!at !is document !as reac!ed BA& and !e s!ould collect t!em immediatel"$ An -Dform is necessar" for e7ports out of t!e countr"$ It is a part of e7c!ange control mec!anism of t!e State Bank of )akistan$ 9!en an e7porter recei/es an &B(0 t!e ne7t 5o# is to get an -Dform from t!e #ank$ +!e -Dform is a Cuadruplicate and contains t!e following information$ +!e (ommodit" +!e Cuantit" +!e price +!e port of s!ipment +!e port of destination +erms of s!ipment After getting t!e -Dform /erified from #ank0 t!e e7porter starts preparing for !is s!ipment$ As t!e #anks onl" deal in documents0 so in order to recei/e t!e pa"ment for !is good to #e e7ported0 t!e e7porter !as to send certain documents to t!e &B( issuing #ank /ia negotiating #ank$ +!ese documents !a/e alread" #een discussed in import section$ A /er" important step in t!e e7port process is to scrutini8e t!e documents0 #efore sending t!em to t!e issuing #ank$ It reCuires utmost care and attention of t!e #ank officer$ 9!en t!e documents are presented in t!e #ank0 t!e" are alwa"s scrutini8ed

E?

and t!e" must #e in accordance wit! t!e reCuirements stipulated on t!e &B($ An" de/iation could result in re5ecting t!e documents #" t!e importer0 !ence causing loss to t!e e7porter or e/en to t!e #ank if t!e documents are to #e negotiated$ Bank Alfala! pro/ides a platform to en!ance foreign trade in )akistan$ No one can den" t!e important role Foreign +rade pla"s in progress of an" econom"$ +!is foreign trade can #e in two formsI eit!er EB=210: (sending "our goods out) or I<=210: (#u"ing goods from a foreign land)$ I would first t!roug! lig!t on -7ports #" descri#ing t!e /arious met!ods used #" t!e #ank$ In e7ports0 #ank Alfala! pro/ides its customers wit! 2 different wa"s$ +!ose are H$ FDB( 2$ Ad/ance )a"ment &et me e7plain eac! one0 according to m" understanding$ ).&.". FDBC M FOREIGN DOCUMENTARY BILL FOR COLLECTIONIf a personBcompan" in )akistan wants to do #usiness wit! a compan" in ,3 #" suppl"ing its products against mone" t!roug! t!is mode0 it.ll come to t!e #ank to get an -DF%*M (e7port form)$ +!e reCuirements for -Dform issuance areI AB( in t!e name of firm NI( (!am#er mem#ers!ip (if an") N+N

+!en t!e part" transfers its goods to ,3 t!roug! s!ip or air and will come to t!e #ank wit! t!e following documentsI In/oice (containing t!e amount of goods s!ipped) S!ipping #ill Bill of &ading (non negotia#le) Bill of -7c!ange )acking list (containing t!e list of goods s!ipped)

+!e #ank attac!es t!e (o/er &etter wit! t!ese documents and transfers t!e (AD (cas! against documents) reCuest to t!e importer.s #ank0 w!o after taking t!e cas! from importer against t!ese documents (t!at are used #" importer to get !old on t!e goods s!ipped) sends it #ack to BA& t!roug! N%S+*% #ank$ N%S+*% #ank is t!e one t!at E5

knows #ot! parties and is !a/ing AB( of #ot!$ Bank uses software named S9IF+ t!at gi/es message w!ene/er a pa"ment comes in N%S+*%$ Message is actuall" an :information; t!at.s pro/ided #" 4% (!ead office)$ 'u5ranwala #ranc! is !a/ing a code of LL5K in S9IF+$ 9!ene/er a message is recei/ed containing e7port receipt wit! code LL5K0 t!e acti/it" of N%S+*% is downloaded t!roug! t!e software NAS (N%S+*% acti/it" s"stem) t!at contains all t!e operations and acti/ities of N%S+*% in /arious countries and places wit! lots of ot!er #anks and #ranc!es$ +!us0 acti/it" can #e rig!tl" called as :conformation; of t!e information$ +!e directed officer0 w!o.s Miss Saira0 does t!is process and !ig!lig!ts t!e (ustomer reference Date )a"ment Details Matc! wit! t!at of t!e message$

+!is is t!e #rief process$ +!e detail is mentioned #elow under t!e specific !eads$ ).&.$. E#FORM ISSUANCE%n reCuest0 #" part"0 to issue t!e -Dform0 #ank does t!e followingI Ferif" t!e signs on reCuest letter wit! stamp Note down AB( num#er from t!e letter Stamp and write initials representing t!e sign /erification on reCuest 9rite down t!e issuance on register named -Dform issuance to keep t!e record$ %n t!e reCuest0 -Dform num#er and date is mentioned$ Issues four paged -Dform wit! stamp on it$ (ustomer keeps t!e original (for customer) and t!e Cuadruplicate (for custom) cop" and returns to #ank t!e triplicate (SB).s cop") and duplicate (#ank.s cop") one$ ).&.%. E#FORM CERTIFICATION%n issuance of -Dform0 certification is done in two wa"s$ If it.s F%B (freig!t on #oard Z importer will pa" t!e freig!t) t!en onl" :aut!orit" certificate; would #e filled0 sa"ing t!at we aut!ori8e t!is person to recei/e BB&$ If it.s (IF (cost insurance freig!t Z we pa" for it)0 we issue certificate sa"ing t!at t!is transaction is not F%B #ased0 wit! a reCuest to issue BB& and an N%($ E

In #ot! cases0 we stamp t!e eDform and make entr" (w!ic! is incomplete at t!e time of issuance) on certification register$ ).&.*. MAINTAINING CUSTOMER FILE9!en documents come for (AD0 t!e documents for #ank record (ot!er t!an t!ose t!at are sent to t!e importer) are punc!ed in a separate file carr"ing t!e name of firm$ +!en t!e file is assigned wit! a num#er e$g$ FDB(B'9&BEL$ %n t!e front0 t!e ,SD amount of consignment sent is also mentioned$ A lia#ilit" is also #ooked on t!e same file on t!e #asis of t!at da".s rate (taken from 4%) in )ak *upee (rounded /alue)0 t!at will simpl" #e re/ersed t!e da" pa"ment is recei/ed$ +!is is done to #ind t!e customer$ In t!is file0 t!e list of t!e documents kept is as underI (o/ering letter of firm 2 )acking lists and in/oices H cop" of BB& (non negotia#le) H s!ipping #ill (cop") 2 eDforms (t!at are returned #" t!e customer) H p!otocop" of /ouc!er (of lia#ilit" #ooked in t!e name of part") H p!otocop" of co/er letter to foreign #ank H p!otocop" of B%H p!otocop" of original BB& (on t!e original BB&0 officer endorses t!at t!e s!ipment is in t!e order of foreign #ank and t!e cop" of t!is endorsed BB& is attac!ed in #ank.s file) D4& receipt (courier) +!e front of t!e file is stamped wit! Date of certificationAAA (+aken from -Dform) Date of s!ipmentAAAA$ (+aken from BB& i$e$ #oardingBs!ipment date) Date of lodgmentAAA$$ (+!e date on w!ic! doc are recei/edI current) Date of reali8ationAAA$$ (%n receipt of pa"ment) ).&.&. ON REALI+ATION OF EXPORT PAYMENT%n reali8ation of pa"ment in FDB(0 we do t!e followingI

E6

*e/erse t!e lia#ilit" in /ouc!er Make entr" in FDB( register Make entr" in -Dform certification register Make entr" in reali8ation register %n receipt of pa"ment0 a file is opened (sa" wit! t!e num#er 2L) in t!e following formI ADFB2LBL6 +!is file will containI o Message and acti/it" o (op" of Blotter and /ouc!ers If0 t!is w!ole pa"ment is #eing wit!drawn t!roug! t!e eDform0 we.ll endorse and place all t!e documents in t!is /er" file and not ot!erwise$

).&.'(. FILE MAINTENANCE-

%n wit!drawal of 5LLL0 t!e file code would #eI ADFB2LABL6

And t!e documents pro/ided #" t!e customer would #e punc!ed in it$ +!e documents includeI o o o o o descri#ed ne7t$ %n wit!drawal of ne7t amount0 w!ic! if is 5LLL0 file ADFB2LBBL6 would #e t!e last file and if it.s lesser t!en file 2L(0 2LD and so on would come into e7istence$ Again t!e documents to #e attac!ed would #e t!e 2 -Dforms and t!e ot!er pre/iousl" (customer pro/ided) and ne7t (#ank arranged) mentioned documents$ ).&.''. EXPIRY OF PAYMENT(op" of s!ipping #ill (op" of BB& In/oice (o/ering &etter from t!e part" +wo eDforms

+!is file.s not complete "et$ A few more documents are to #e placed in it0 w!ic! will #e

E@

Ad/ance pa"ment0 if not used0 gets e7pired after a "ear$ +o use t!is e7pired amount0 special permission is to #e soug!t from SB)$ Now0 a Cuestion arises0 t!at if ad/ance pa"ment is credited to part".s account and it uses it for t!ings ot!er t!an e7port and doesn.t e7port an"t!ing to t!e foreign part"0 w!at t!en is to #e doneY +!e answer is0 a person !as to #e mad to do it0 #ecause !e.s pa"ing all t!e duties to t!e #ank$ If !e does it0 t!en #ank after a "ear will seek permission from SB) to let !im do t!e s!ipment now from !is own mone" against t!at pa"ment$ And if !e.s not willing to do t!e s!ipment at all0 !e.ll lose !is credi#ilit" wit! t!e #anks$ Bank doesn.t lose an"t!ing in Ad/ance )a"ment$ ).&.'). E#FORM SUBMISSION-Dform.s triplicate cop" along wit! t!e original in/oice pro/ided #" t!e part" and t!e cop" of ad/ance pa"ment /ouc!er from return will #e su#mitted to SB) on mont! end$ ).&.' . RETURN%n mont! end0 return is to #e sent to SB)0 illustrating t!e progress and performance of t!e #ank in t!at w!ole mont!$ %n receipt of ad/ance pa"ment0 A ad/ance pa"ment /ouc!er is filled wit! t!e total amount$ If an" amount is used0 t!is /ouc!er is endorsed from t!e #ack$ And if t!e amount is used after sending t!at mont!.s return0 t!e endorsement is made on t!e #ack of t!e cop" of t!at /ouc!er maintained in t!e *eturn *egister0 w!ic! are kept mont! wise$ +!is return is sent to SB) along wit! t!e following documentsI M F%*M The charges that foreign bank has deducted from the payment are enlisted on it. FDB( -DForm Foreign (urrenc" Details Mone" 'ram

-ac! department pro/ides its details w!ic! are com#ining sent to SB) in t!e form of return$ ).&.'!. TASKS THAT I PERFORMED-

EE

In e7ports0 I understood t!e w!ole process w!ile watc!ing Ma.am doing all t!e steps$ t!e tasks t!at I performed wereI 'ot documents p!otocopied 'ot documents (#lotter0 /ouc!er0 -)*() signed 'ot /ouc!ers stamped$ (alculated of 9$4$+a7$ Searc!ed *eturn0 Ad/ance pa"ment0 FDB(0 -Dform certification and ot!er reCuired registers and source0 9$4$+ and reference files$ (ompiled 9$4$+a7 files$ Arranged and completed FDB( and ADF pa"ment files$ -ndorsed ADF pa"ment /ouc!ers and -Dforms$ 'ot DD num#er from Mr$ Namar downstairs$

HLL

).'(. ORGANI+ATIONAL STRUCTURE OF FINANCE DEPARTMENT OF BAL GUJRANWALA BRANCH-

C1e360 Ma/age1 Mr$ 4ama"oun *asool Mal!ee

SME Mr$ ,sman Mr$ Mu!ammad Ali

H2<e L2a/ Mr$ Faisal Mr$ S!a!id

Re041/ A g4a1a/0ee: ,sman Anwer

Ag16#C1e360 Mr$ S!a!8ad Naseem

).'(.'. N4<8e1 27 e<=;2?ee: F2196/g 6/ 0>e 76/a/5e 3e=a10<e/0+!ere are t!e emplo"ees working in t!e finance department of BA& 'u5ranwala$ Mr$ 4ama"oun *asool Mal!ee is t!e !ead of t!e department and c!eck all t!e acti/ities performed #" t!eir su#ordinate.s w!ole team are responsi#le$ +!e" 5ust forward t!e case to centrali8e and if centrali8e gi/e appro/al t!en t!e" pro/ide finance to t!e customers$ ).'(.). F6/a/5e A a5524/06/g 2=e1a062/:Finance and accounting departments are interlinked wit! eac! ot!er finance department makes financing decision first confirm from accounting acti/ities t!en pro/ide finance to t!e customers eit!er finance is a/aila#le or not$ Finance department easil" makes t!e decision on #e!alf of t!e calculation of t!e accounting s"stem of t!e organi8ation$ +!e accounting operation includes t!e #anks accounts maintained wit! ot!er #anks0 t!e updated status of t!e customer0 e7ecution of standing instructions0 discounting #ills of e7c!ange0 pa"ment and collation on #e!alf of customers0 customers accounts maintenance0 collection of #ills of e7c!ange #" #ank0 t!e collections of #ills including utilit" #ills$ Accounts department also passes t!e closing entries on mont!l"0 mont!l" and "earl" #ases to calculate t!e profit and anal"8e t!e o/erall performance for a certain

HLH

period$ +!e accounting s"stem of t!e BA& deals wit! /arious routine acti/ities for t!e #ank$ Fiscal "ear of #ank starts from 1anuar" and ends on Decem#er$ ).'(.!. F4/5062/: 27 0>e F6/a/5e De=a10<e/0 A5524/06/g S?:0e< 27 0>e BAL+!e accounting s"stem of t!e #ank is well mange t!e" !a/e t!e accounting software in t!eir BA& smart software t!ere is no manual work reCuired all accounting ledger generals are computeri8ed$ +!eir accounting s"stem is #ased on cas! and accrual #asis t!e" make dail" reports for t!e record keeping and make anal"sis and decision on t!at #asis$ +!e" c!eck t!e dail" acti/it" w!ic! is generated automaticall" from t!e s"stem t!e dail" transactions report$ A De#it /alue will alwa"s #e recorded on t!e de#it side left !and side of a nominal ledger account and t!e credit /alue will #e recorded on t!e credit side rig!t !and side of a nominal ledger account$ A ledger !as #ot! a De#it left side and a (redit rig!t side$ If t!e /alues on t!e de#it side are greater t!an t!e /alue of t!e credit side of t!e nominal ledger t!en t!at ledger is said to !a/e a de#it #alance$ +!e accounts department t!e /ouc!ers wit! dail" acti/it" report generated #" t!e computer$ +!e /ouc!ers are t!en sorted out into #undles according to t!eir categories and comparing wit! t!e acti/it" report c!ecks t!e posting of transaction$ Accounting operations pro/ides decision makers wit! sufficient rele/ant information to make prudent and intelligent decisions regarding #ank.s #usiness$ From t!is s"stem we easil" calculate t!e assets and lia#ilities of #ank0 cas! inflow and outflow all acti/ities done in t!e accounting s"stem of t!e BA&$ F6/a/5e :?:0e< 27 0>e 21ga/6Da062/+!e financing s"stem of t!e BA& is centrali8ed all t!e decisions regarding financing is taken #" !ead office$ In t!is #ranc! t!e" onl" inform t!e customers a#out t!e procedure and polic" regarding financing acti/ities$ Financing #" BA& include SM-0 4ome loans0 credit cards0 agriDfinace0 leasing0 #ank guarantees etc$ +!e Financing polic" of #ank is t!e com#ination of certain glo#all" and locall" accepted time standards and ot!er d"namic factors dictated #" realities in e/erDc!allenging market and industr"$ +!e e7tension of a financing facilit" s!ould add /alue to t!e #ank.s assets; s!ould #e #orne #" t!e #ankers$ For t!is purpose t!e #ank takes special care for 5udging t!e A#ilit" to repa"

HL2

9illingness to pa"

+!e de/elopment of #ank #" earning income in t!e form of markDup0 de/elopment of w!ole econom" #" financing t!e de/elopment pro5ects #ot! in pri/ate and pu#lic sector and !elp in accelerating t!e rate of growt!$ +!is department facilitates t!e trade acti/ities #ot! inside and outside t!e countr" ).'(.". U:e 27 e;e5012/65 3a0a 6/ 3e56:62/ <a96/g+!e accounting s"stem of t!e BA& is pro/ide electronic data all t!e dail" acti/ities report generated t!roug! electronic s"stems0 w!ole organi8ation is electronic #ase if t!e send or recei/e an" file t!e" use email s"stem fa7 s"stem$ +!e file generated #" s"stem is !elpful in making #udgeting financing make t!e anal"sis current deposits situation of t!e #ranc! t!e profit of t!e #ranc! all electronic data is !elpful in decision making0 #ecause electronic s"stem of #ank generate accurate and timel" information for furt!er decision making$ Banks Smart Software is /er" !elpful in making decisions$ ).'(.$. M286;6Da062/ 27 74/3:Bank Alfala! mo#ili8e its funds in financing to SM-.s0 pro/ide !ome loans w!o !a/e no residential facilit" #ank Alfala! gi/e t!en t!e facilit" to take mone" and #uild new !ome or reno/ation purposes0 it also pro/ide finance to Agri sector also pro/ide Agri eCuipments or mac!iner" to t!e former$ It also facilitates t!e customers t!roug! leasing$ +!roug! financing t!e" c!arge interest from customers t!at is called markup rate it is t!e profit of t!e #ank$ ).'(.%. Ge/e1a062/ 27 74/3:BA& generate its funds t!roug! t!e following acti/ities from consumer #anking like deposits0 profit from in/estments0 t!roug! offering s!are and #onds0 t!roug! markup$ Sa/ings and loan associations0 w!ic! are state institutions0 pro/ide !omeD#uilding loans to t!eir mem#ers out of funds o#tained from sa/ings deposits and from t!e sale of s!ares to mem#ers$ Finance companies make small loans wit! funds o#tained from in/ested capital0 surplus0 and #orrowings$ (redit unions0 w!ic! are institutions owned cooperati/el" #" groups of persons !a/ing a common #usiness0 fraternal0 or ot!er interest0 make small loans to t!eir mem#ers out of funds deri/ed from t!e sale of s!ares to mem#ers$

HLK

).'(.*. S2415e: 27 74/3 Deposits From financial institutions incase of an" s!aring From t!eir su#sidiar" companies &easing 'uarantees &B(s (redit card interest Markup on different funding

).'(.&. A;;25a062/ 27 F4/3:+!ese decisions of allocation of funds are taken #" !ead office #ecause it.s t!e risk" task so t!e main office takes decisions regarding t!is matter #ut t!e SB) polic" t!at it takes KLP reser/es from e/er" #ank for an" assistance or for furt!er in/estment of t!e #ank$ Description of allocation of funds in different departments was reCuired$

HL?

HL5

HL

). FINANCIAL ANALYSIS-

HL6

HL@

HLE

HHL

HHH

HH2

RATIO ANALYSIS .!. CALCULATIONS OF SPECIALI+ED RATIOSCONCERNED YEARS- 2LL 0 2LL60 2LL@ Ra062: Ea1/6/g a::e0: 02 020a; a::e0: Re041/ 2/ ea1/6/g a::e0: Ne0 <a1g6/ 02 ea1/6/g a::e0: L2a/ ;2:: C2Ce1age 1a062 De=2:60 06<e 5a=60a; L2a/: 02 3e=2:60 Ea1/6/g a::e0: 02 020a; a::e0:For u!a: -arning assets Ea1/6/g a::e0: 02 020a; a::e0: ] +otal Assets (alculation of earning assets missingYYYYY Ra062 Ea1/6/g a::e0: 02 020a; a::e0: COMMENTS +!is ratio s!ows t!at #ank management does not efficientl" uses t!e #ank assets to generate profit$ +!e earning assets of Ba/9 A;7a;a> L6<60e3 are decreasing0 w!ic! is #ecause of t!e c!ange in in/estment pattern of Ba/9 A;7a;a> L6<60e3. Alt!oug! t!e earning assets of Ba/9 A;7a;a> L6<60e3 !a/e increased as compared to #ot! pre/ious "ear #" "et lesser t!an increase in total assets$ +!e #ank !as used muc! amount to in/est HHK )(($ )((% ]2KH ELH?LB265 @55 ]2@H52KK5KBK2@@E5H5 ?H N*!E 2 ]*"."E )((* ]2EK5?LE5LBK?@EEL6 ? ]*!.'E V HLL )(($ @?P L$6 P 2$56P H$26P 22$ P L$ 2 )((% @5$5P H$HHP K$25P HE$ P HE$@P $2 )((* @?$HP L$HLP K $5P L$H@P 2L$5P L$ ? C>a/ge ,nfa/ora#le ,nfa/ora#le Fa/ora#le ,nfa/ora#le Fa/ora#le ,nfa/ora#le

in operating fi7ed asset0 w!ic! are not included in earning assets$ Re041/ 2/ Ea1/6/g A::e0:For u!a: Net profit after ta7 Re041/ 2/ ea1/6/g a::e0: ] -arning assets V HLL

Ra062 Re041/ 2/ ea1/6/g a::e0: COMMENTS

)(($ )((% ]H6 2 EHB2KH ELH?L ]KHKL22EB2@H52KK5KV VHLL N(.%$ HLL ]'.''

)((* ]HKLHKLHB2EK5?LE5LV HLL ](.'(

+!is ratio is a profita#ilit" measure t!at s!ows t!e strengt! of a #ank$ +!e calculation of t!e concerned ratio indicates t!at t!e earning of Ba/9 A;7a;a> L6<60e3 !as decreased in t!e current "ear as compared to t!e pre/ious "ear$ +!is ma" #e due to mismanagement of t!e #ank resources$ +!e net profit of t!e #ank !as decrease0 w!ereas t!e earning assets of t!e #ank !a/e increased$ +!is is due to c!ange in t!e in/estment pattern of t!e #ank$

Ne0 Ma1g6/ 02 Ea1/6/g A::e0:For u!a: Net Margin Net margin to earning assets ] -arning assets V HLL

HH?

Ra062 Ne0 Ma1g6/ 02 Ea1/6/g A::e0: COMMENTS-

)(($ )((% ]5E5@5@?B2KH ELH?L ]EH 2EL@B2@H52KK5KV VHLL N)."% HLL ] .)"

)((* ]HL6H5K@EB2EK5?LE5L VHLL ] $."

+!is ratio is most important in measuring t!e #ank profita#ilit" #ecause it represents t!e a#ilit" of t!e management to control t!e spread #etween interest income and interest e7pense$ Alt!oug! t!e calculations s!ow fa/ora#le result of Bank Alfala! &imited as compared to t!e pre/ious "ear "et t!e #ank !as not properl" controlled t!e spread of e7penses o/er income$ It s!ows t!at alt!oug! t!e #ank !as increased its profita#ilit" #ut t!e earning assets are not t!e Cualit" assets #ecause of !ig!er increase in interest e7pense as compared to interest income$ L2a/ L2:: C2Ce1age Ra062For u!a: )re ta7 profit U pro/ision against nonDperforming loans &oan loss (o/erage ratio ] Net c!arges off U pro/ision against nonDperforming loans Ra062 L2a/ L2:: C2Ce1age Ra062 )(($ ]25 5E?5UEH 2EL@B H5K6UEH 2EL@ ]HH62@@5KBEH ???5 N'.)% )((% ]?5K5552U2K6L@ B5@? ?U2K6L@ ]?662 K@B2?2EKL N'&.$ N(.'* COMMENTS+!is ratio is also t!e profita#ilit" measure of t!e #ank$ It !elps in determining t!e asset )((* ]H6E?62LU2LK5EE6B2@ 2E@U2LK5EE6 ] * (%'%L)($!)&"

HH5

Cualit" and le/el of protection of loans$ +!is is a measure of protection to t!e depositors a#out t!e co/erage of loan loss$ +!e loan loss co/erage of Ba/9 A;7a;a> L6<60e3 s!ows lesser results as compare to t!e pre/ious "ears #ecause t!e pro/ision against nonD performing loans increased$ Bad de#ts !a/e also increased w!ic! s!ow a negati/e aspect of t!e #ank #ecause it can affect t!e profita#ilit" of t!e #ank$

De=2:60 T6<e Ca=60a;For u!a: Deposits De=2:60: 06<e 5a=60a; ] (apital Ra062 De=2:60 T6<e Ca=60a; COMMENTS+!is is a ke" ratio to determine t!e #ank credit rating$ 4ig!er deposits s!ow t!e a/aila#ilit" of more amounts for ad/ances0 w!ic! is t!e ma5or operation of commercial #anks$ +!e !ig!er deposits of Bank Alfala! &imited in t!e current "ear indicate t!at t!e #ank !as more mone" to ad/ance w!ic! will affect t!e profita#ilit" of t!e #ank in a positi/e wa"$ Increase in deposits will definitel" impro/e t!e credit rating of Ba/9 A;7a;a> L6<60e3$ But on t!e ot!er !and t!e capital also increased w!ic! gi/es a negati/e answer to t!e ratio$ HH )(($ )((% ]2KE5LEKEHBHL562 L ]26KH6K@?HBHK6 5 ])).$ ]'&.* 6K )((* ]KLL6K2@5@BH? L@52K ])(."

L2a/: 02 De=2:60 Ra062For u!a: Ad/ances L2a/: 02 3e=2:60 ] Deposits Ra062 L2a/: 02 3e=2:60 )(($ ]H?EEEEK25B 2KE5LEKEH ]L$ 2 times COMMENTS+!is ratio is a t"pe of de#t co/erage ratio and it measures t!e position of t!e #ank wit! regard to taking risks$ In speciali8ed anal"sis of Ba/9 A;7a;a> L6<60e3 it is o#ser/ed t!at de#t co/erage of #ank is decrease in 2LL@$ +!e decrease in loans s!ows t!at t!e #ank deposits are not utili8ed more properl"$ +!e profita#ilit" of t!e #ank directl" depends on t!e loans B Ad/ances$ )((% ]H6HHE@EE2B26KH6K@? H ]$.)$ 06<e: ]L$ ? times )((* ]HE2 6HH EBKLL6K2@5 @

.". Ca;54;a062/: 721 LeCe1age Ra062:*atios in/ol/ed in t!e anal"sis are De#t ratio -Cuit" ratio De#t to eCuit" ratio +otal eCuit" Sales to Fi7ed Assets *atio De#t to +angi#le net wort! *atio Fi7ed Assets to -Cuit" *atio +otal (apitali8ation *atio

HH6

ITEMS INVOLVED -arning #efore interest and ta7es Interest &ease pa"ment )referred di/idend +otal de#ts +otal assets +otal eCuit" +angi#le de#ts +angi#le net wort!

C2/5e1/e3 Yea1: 2LL 0 2LL60 2LL@ De80 Ra062For u!a: +otal de#ts De80 1a062 ] +otal assets VHLL

HH@

Ra062

)(($ ]2 K0??K05E B 2650 @505?HVHLL

)((% ]KH2 65KL@B K2@@E5H52VHLL N&"E

)((* ]KKHE? L25B K?@EEL6 ?VHLL N&".'E

De80 1a062 ] &"."E

E@460? Ra062For u!a: Tota! "#uit$ a ount i% incorr"ct.

+otal -Cuit" E@460? Ra062 N +otal Assets Ra062 )(($ ]HL562 L5B 265 @55?HVHLL E@460? 1a062 ] .*E De80 02 E@460? Ra062For u!a: +otal De#ts E@460? Ra062 N +otal -Cuit" OHLL N"E N"E )((% ]HK6 )((* ]H? L@52KB K?@EEL6 ?VHLL OHLL

6KB

K2@@E5H52VHLL

HHE

Ra062

)(($ ]2 K0??K05E B HL562 L5VHLL

)((% ]KH2 65KL@B HK6 6KVHLL

)((* ]KKHE? L25B H? L@52KVHLL N))%).)E

De80 02 E@460? Ra062 ] )!&'.%E De80 02 Ta/g68;e /e0 F210> Ra062For u!a: N))%'.)E

+otal De#ts De80 02 Ta/g68;e /e0 F210> Ra062 N OHLL +angi#le net wort! Ta/g68;e /e0 F210> N -Cuit" Z All intangi#le assets 2LL ] HL562 L5DK@EL ]HL5KK EE 2LL6] HK6 2LL@] 6K DHH 6 ] HK ?EEE6

H? L@52KD2H6EKH] H?KEL5E2

Ra062 De80 02 Ta/g68;e /e0 F210> Ra062

)(($ ]2 K0??K05E B HL5KK EEVHLL ] )"((.&E

)((% ]KH2 65KL@B HK ?EEE6VHLL N))&(.$E

)((* ]KKHE? L25B H? L@52KVHLL N))%).)E

H2L

Sa;e: 02 F6Be3 A::e0: Ra062For u!a:

Net sales Sa;e: 02 FBe3 A:e:0: R062 N OHLL Net fi7ed assets

Ra062 Sa;e: 02 F6Be3 A::e0: Ra062

)(($ ]5E5@5@?B HL5L2EELVHLL ] "$.%E

)((% ]EH 2EL@B HHE22K2?VHLL N%$.*E

)((* ]HL6H5K@EB HK66K2EKVHLL N%%.%E

F6Be3 A::e0: 02 E@460? Ra062For u!a:

Fi7ed Assets Sa;e: 02 FBe3 A:e:0: R062 N -Cuit" OHLL

H2H

Ra062 F6Be3 A::e0: 02 E@460? Ra062

)(($ ]HL5L2EELB HL562 L5VHLL ] &&. E

)((% ]HHE22K2?B HK6 6KVHLL

)((* ]HK66K2EKB H? L@52KVHLL N&!.)E

N*$.$E

H22

COMMENTS In consideration to t!e longDterm de#ts pa"ing a#ilit" of A;7a;a> Ba/9 L03 in t!e "ear 2LL 0 2LL60 2LL@0 it is o#ser/ed t!at t!e sol/enc" of t!e #usiness is towards t!e owner$ +!e results of t!e calculations s!ow t!at t!e A;7a;a> Ba/9 L03 is in normal position as comparati/e "ears$ In t!is "ear0 t!e #ank assets and eCuit" !a/e increased wit! a !ig!er percentage as compare to t!e pre/ious "ears #ut total de#ts also increase in 2LL@ slig!tl" w!ic! s!ows t!at t!e #ank is now not in good position as compared to pa" its longDterm de#ts$ -Cuit" of t!e #ank !as increased and Asset !as increased w!ic! s!ows t!at t!e #ank is in a good position to pa" its longDterm de#ts$ Alt!oug!0 t!e de#ts of t!e #ank are also increasing0 #ut t!e percentage of increment in assets are more t!an de#ts$ From calculation of ratios s!ow t!at #ank are in struggling to ac!ie/e its pre/ious a image for t!e prospecti/e in/estors to in/est t!eir mone" in t!e #ank$ It also s!ows t!at t!e #ank !as a#ilit" to pa" its de#t easil" w!ic! is due$ +!e increase in eCuit" is also due to t!e increase in reser/es and net earnings of t!e #ank$ But as on one side if it is fa/ora#le for t!e #ank on t!e ot!er side it is also unfa/ora#le #ecause w!en t!e sol/enc" of t!e compan" is fa/ora#le toward t!e owner so it means t!at t!e eCuit" of t!e compan" is contri#uting more t!an ot!er items$ Due to increase in eCuit"0 t!e compan" !as to face t!e ta7 wit! a !ig! percentage$

H2K

.$. Ma19e0 A/a;?:6:&"'inition Market Anal"sis considers t!e current market position of an" organi8ation$ -speciall" of t!ose in/estors w!o want to in/est in stock of %rgani8ation and gain a long term #enefits$ +!is anal"sis pro/ides facilit" to t!e in/estors to make.s t!eir in/estment decisions on t!e #asis of following ratiosI

(alculations for Market Anal"sis

*atios in/ol/ed in t!e anal"sis are -)S (-A*NIN' )-* S4A*-) B%%3 FA&,- )-* S4A*DIFID-ND )AG%,+ *A+I% )-*(-N+A'- %F *-+AIN-D -A*NIN'

ITEMS INVOLVED 0arning before interest and ta es &nterest /arket price per share 0arning per share 2umber of shares outstanding 3ividend per share Total e4uity

EPS (ea1/6/g =e1 :>a1e)Net earning or Net income -)S ]

H2?

No of s!ares outstanding Net income amount is incorrect Ra062 )(($ ]H6 2 EHB 5LLLLL ] .") )((% ]KHKL22EB6EE5LL N .&' )((* ]HKLHKLHB6EE5LL N'.$)

Ea1/6/g Pe1 S>a1e PLE Ra062For u!a:

Market price per s!are )B- *atio] -arning per s!are Ra062 )(($ ]K@$5B K$52 ] '(.& )((% ]?L$@BK$EH N'(.! )((* ]55$?BH$ 2 N !.'

P165e Ea1/6/g Ra062

B229 Va;4e =e1 S>a1eFor u!a: +otal -Cuit" Z preferred stock B229 Va;4e Pe1 S>a1e ] No of s!ares outstanding Ra062 B229 Va;4e )(($ ]HL562 L5B 5LLLLL )((% ]HK6 )((* ]H? L@52KB6EE5LL

6KB6EE5LL

H25

Pe1 S>a1e

] )'.'

N'%.)

N'*.)

D6C63e/3 =a?240 1a062For u!a: Di/idend per s!are D6C63e/3 Pa?240 Ra062 ] -arning per s!are Ra062 D6C63e/3 Pa?240 Ra062 D6C63e/3 Y6e;3 Ra062For u!a: D6C63e/3 Y6e;3 ] Di/idend per s!are Market /alue per s!are Ra062 D6C63e/3 Y6e;3 1a062 )(($ ]LBK@$5 ]( )((% ]LB?L$@ N( )((* ]E65LLLB55$? N'%"&&.) )(($ ]LBK$52 ]( )((% ]LBK$EH N( )((* ]E65LLLBH$ 2 N$('*"'.*

Pe15e/0age 27 Ea1/6/g Re0a6/e3 1a062For u!a: Pe15e/0age 27 ea1/6/g 1e0a6/e3N +otal IncomeD Di/idend VHLL +otal Income Ra062 Pe15e/0age 27 Ea1/6/g Re0a6/e3 1a062 H2 ]HLLP N'((E )(($ ]H6 2 EHDLBH6 2 EH )((% ]KHKL22EDLBKHKL22E )((* ]HKLHKLHD LH@5H$@B HKLHKLH ]" .%E

COMMENTS +!e market anal"sis of #ank Alfala! s!ows t!at t!e #ank !as not performed well in t!e market e/en t!oug! t!e net earnings !a/e increased #ut still -arning per S!are !as declined to onl" H$ 2 from K$EH$ It s!ows a decline of profit of s!are w!ic! can discourage t!e in/estors to in/est in t!e #ank$ +!e #ook /alue of t!e #ank is far lower t!an its market /alue$ But t!e market anal"sts do not rel" more on #ook /alue #ecause it is #ased upon !istorical cost$ 9!en market /alue is #elow #ook /alue0 in/estors /iew t!e compan" as lacking potential$ A market /alue a#o/e #ook /alue indicates t!at in/estors /iew t!e compan" as !a/ing enoug! potential to wort! more t!an t!e unreco/ered cost$ 9!en in/estors are pessimistic a#out t!e prospects for stocks0 t!e stocks will sell #elow #ook /alue$ %n t!e ot!er !and0 w!en in/estors are optimistic a#out stock prospects0 t!e stock will sell a#o/e #ook /alue$ Book /alue per s!are !as increase slig!tl" as compared to t!e pre/ious "ear t!is is #ecause t!e eCuit" !as increased #ut t!e s!ares !a/e increased w!ic! resulted in t!e decline of #ook /alue$ +!is also s!ows a negati/e picture of t!e #ank$ In t!e "ear 2LL@ t!e di/idend pa"out ratio also increases and t!e management !as decided to gi/e di/idend in t!at "ear$ It is positi/e for t!e #ank on one side t!at t!en in/ertors ma" #e willing after c!ange and in/est in BA&$ Most firms !esitate to decrease di/idends since t!is tends to !a/e ad/erse effects on t!e market price of t!e compan".s stock$ No rule of t!um# e7ists for a correct pa"out ratio$ Some stock !olders prefer !ig! di/idendsQ ot!ers prefer to !a/e t!e firm rein/est t!e earnings in !opes of !ig!er capital gains$ +!e increase in t!e percentage of retained earnings could gi/e a negati/e influence to t!e in/estors$ But still t!e in/estor will #e waiting to see t!e furt!er results$ It is due to t!e reason t!at t!e in/estor would #e interested to in/est in t!e #usiness in order to get more di/idends$ But wit! t!is decrease in t!e retention ratio t!e potential in/estor will not remain an" more interested in t!e #usiness #ecause in/estor reCuires return and if !e don.t get t!at !e will not in/est in t!at firm$ .%. Ca:> 7;2F A/a;?:6:-

H26

+!e statement allows t!e preparer to use t!e concept of cas! t!at included not onl" cas! itself #ut also s!ortDterm !ig! liCuid in/estments$ It contains t!ree important t!ings t!ese areI (as! flow from %perating Acti/ities$ (as! flow from Financing Acti/ities$ (as! flow from In/esting Acti/ities$

O=e1a06/g Ca:> =e1 S>a1e Ra062For u!a: O=e1a06/g Ca:> =e1 S>a1e N %perating (as!^^^^^^ No of s!ares %utstanding

Ra062 O=e1a06/g Ca:> =e1 S>a1e

)(($ ]6@52K 2B5LLLLL N'".%

)((% ]KE ?5K25B6EE5LL N!&."

)((* ]2?EE L B6EE5LL N .')

O=e1a06/g Ca:> 02 T20a; De80: Ra062For u!a: O=e1a06/g Ca:> 02 T20a; De80: N %perating (as!VHLL +otal De#ts Ra062 O=e1a06/g )(($ )((% ]6@52K 2B2 K0??K05E ]KE ?5K25BKH2 65KL@ VHLL VHLL )((* ]2?EE L BKKHE? L25V HLL

H2@

Ca:> 02 T20a; De80: Ra062

N)&.*"E

N').$%E

N(.%"E

O=e1a06/g Ca:> 02 Ca:> D6C63e/3 Ra062For u!a: O=e1a06/g Ca:> 02 5a:> 36C63e/3 N %perating (as!VHLL

Cash dividend
Ra062 O=e1a06/g Ca:> 02 Ca:> D6C63e/3 Ra062 )(($ ]6@52K 2BLVHLL N( )((% ]KE ?5K25BLVHLL N( )((* ]2?EE L B ( LH@5H$@)VHLL N(!'". )E

H2E

COMMENTS In consideration to t!e a#ilit" of t!e #ank to use t!e cas! t!at includes not onl" cas! itself #ut also ot!er s!ort term !ig!l" liCuid instruments !as negati/e impact on t!e #usiness$ All t!e measurements taken are unfa/ora#le to t!e #ank$ +!e operating cas! of t!e #ank !as decreased in t!e current "ear w!ic! is t!e ma5or reason for t!e unfa/ora#le results of cas! flow anal"sis$ It s!ows t!at t!e operating cas! is insignificant in relation to total de#ts0 w!ic! s!ow t!e Ba/9 A;7a;a> is not a#le to co/er its total de#ts against t!e "earl" cas! flow$ +!e negati/e results s!ow t!e ina#ilit" of t!e management to co/er t!e total de#ts wit! t!e a/aila#le cas! of t!e #ank$ %perating cas! per s!are !as t!e negati/e indication for s!ort term w!ic! indicates t!at t!e #ank cannot make capital e7penditure decisions properl" and will pa" lesser di/idends in t!e concerned "ear$ +!e Bank is0 t!us0 not in a #etter position to pa" its oneD"ear cas! di/idend$ %/erall cas! flow anal"sis s!ows t!at t!e net cas! flow of t!e Ba/9 A;7a;a> from its operating acti/ities would not attract t!e prospecti/e in/estors to make t!eir in/estments in t!e concerned #usiness$ .*. A506C60? Ra062C411e/0 Ra062For u!a: Wor(ing o' curr"nt a%%"t% an) curr"nt !ia*i!iti"% C411e/0 Ra062 N Ra062 C411e/0 Ra062 current Assets^^ (urrent lia#ilities )(($ )((% ]5KL?6E 5BHH?@52 5 ]5H2 EH65B25K @E?L N!.$' N).() )((* ]565@K@@6@BH6H?225 N ." i%%ing+++,

W2196/g Ca=60a; Ra062HKL

For u!a: W2196/g Ca=60a; Ra062 N C411e/0 A::e0: M C411e/0 L6a86;606e: Ra062 W2196/g Ca=60a; Ra062 )(($ ]5KL?6E 5D HH?@52 5 N!'"$)%(( N)"&(() " N"%!')!$" )((% ]5H2 EH65D25K @E?L )((* ]565@K@@6@DH6H?225

A5524/0: Re5e6Ca8;e T41/2Ce1 Ra062For u!a: A5524/0: 1e5e6Ca8;e 041/2Ce1 N Net Sales^^^^^^^^^^^^^^ A/erage 'oss *ecei/a#le.s Ra062 A5524/0: Re5e6Ca8;e T41/2Ce1 Ra062 )(($ ]5E5@5@?BHK??KH $5 N(.(! N(.(" )((% )((* 6 ]EH 2EL@BH L5EEH5@$5 ]HL6H5K@EBH@HEK5L@L $5 N(.("

A5524/0: Re5e6Ca8;e T41/2Ce1 6/ Da?:For u!a: A5524/0: 1e5e6Ca8;e 041/2Ce1 6/ 3a?:NA/erage 'ross recei/a#les Net salesBK 5

HKH

Ra062 A5524/0: Re5e6Ca8;e T41/2Ce1 6/ Da?:

)(($ ]HK??KH @?BK 5 N(.($

6$5B5E5@5

)((% )((* ]H L5EEH5@$5BEH 2EL@ ]H@HEK5L@L$5 BK 5 N(.( BHL6H5K@EBK 5 N(.(!

T20a; A::e0: T41/2Ce1 Ra062For u!a: T20a; a::e0: 041/2Ce1N Ra062 T20a; A::e0: T41/2Ce1 Ra062 COMMENTS From t!e a#o/e anal"sis it is o#ser/e #ed t!at t!e current assets of BA& are increase as compare to its lia#ilities it means BA& !as more current assets to pa"s its current lia#ilities as compare to pre/ious "ears$ +otal assets turno/er measures t!e acti/it" of t!e assets and t!e a#ilit" of t!e firm to generate sales t!roug! t!e use of t!e assets$ +!e total assets turno/er of #ank is increasing w!ic! is a fa/ora#le for #ank Alfala! limited$ Bank Alfala! currentl" generates more sales #" introducing new products and increase more assets to pa" its lia#ilities$ +!e recei/a#le of t!e #ank Alfala! limited in current "ear is constant w!ic! s!ows t!at t!e #ank is reco/ering its recei/a#les constantl" as compared to t!e pre/ious "ear t!at is fa/ora#le for t!e #ank$ .&. P12760a86;60? Ra062)(($ ]5E5@5@?BH22?HE?5 N(.!* Net sales^^^^^^ A/erage +otal Assets )((% ]EH 2EL@BKH 2HE@?? N(.()* )((* ]HL6H5K@EBH6L??6KE N(.$)

HK2

Ne0 P12760 Ma1g6/ Ra062For u!a: Ne0 P12760 <a1g6/N Net Income Net sales Ra062 Ne0 P12760 Ma1g6/ Ra062 )(($ ]H6 2 EHB5E5@5@? N(.)& )((% ]KHKL22EBEH 2EL@ N(. ! )((* ]HKLHKLHBHL6H5K@E N(.')

Re041/ 2/ A::e0: Ra062For u!a: Re041/ 2/ a::e0:N Ra062 Re041/ 2/ A::e0: Ra062 Net income^^^^^^^ A/erage total assets )(($ ]H6 2 EHBH22?HE?5 N(.'! )((% ]KHKL22EBKH 2HE@?? N&.*& )((* ]HKLHKLHBH6L??6KE N(.(%$

D4P2/0 Re041/ 2/ A::e0: Ra062For u!a: D4P2/0 1e041/ 2/ a::e0:N Net profit margin V +otal assets turno/er Ra062 D4P2/0 1e041/ 2/ a::e0: )(($ ]L$2EV(.!* N(.' &) )((% ]L$K?VL$L2@ N(.((& )((* ]L$H2VL$ 2 N(.(%!!

HKK

O=e1a06/g I/52<e Ma1g6/ Ra062For u!a: O=e1a06/g 6/52<e <a1g6/N %perating income Net Sales Ra062 O=e1a06/g I/52<e Ma1g6/ Ra062 Re041/ 2/ O=e1a06/g A::e0: Ra062For u!a: Re041/ 2/ 2=e1a06/g a::e0:N %perating income )(($ ]6@52K 2B5E5@5@? N'. ' )((% ]KE ?5K25BEH 2EL@ N!. ) )((* ]2?EE L BHL6H5K@E N(.)

A/erage operating assets Ra062 Re041/ 2/ O=e1a06/g A::e0: Ra062 O=e1a06/g A::e0: T41/2Ce1 Ra062For u!a: O=e1a06/g a::e0 041/2Ce1N Net sales^^^^^^^^^^^^ A/erage operating asset Ra062 O=e1a06/g A::e0: )(($ ]5E5@5@?BHL5L2EEL N(."$ )((% ]EH 2EL@BHK66K2EK N(.$$ )((* ]HL6H5K@EBHHE22K2? N*.&* )(($ ]6@52K 2BHL5L2EEL N(.%! )((% ]KE ?5K25BHK66K2EK N).*% )((* ]2?EE L BHHE22K2? N(.)(

HK?

T41/2Ce1 Ra062

G12:: P12760 Ma1g6/ Ra062For u!a: G12:: =12760 <a1g6/N 'ross profit Net Sales Ra062 G12:: P12760 Ma1g6/ Ra062 COMMENTS In consideration to t!e a#ilit" of t!e #ank to generate its profi#ilit" return on assets measures t!e firm.s a#ilit" to utili8e its assets to create profit #" comparing t!e profits wit! t!e assets t!at generate t!e profits$ +!e decreasing return on assets in 2LL@ "ear s!ow t!at t!e #ank.s a#ilit" to utili8e its a/erage operating assets$ +!e gross profit ratio of #ank Alfala! also decreases$ )(($ ]525EK56B5E5@5@? N(.** )((% ] 6@ HE6BEH 2EL@ N%.!( )((* ]6H62LK2BHL6H5K@E N(.$$

HK5

.'(. TREND ANALYSIS OF BANK ALFALAH It s!ows t!e trend o/er a period of time$ It includesI Speed of t!e trend Direction of t!e trend Nature of t!e trend

+wo t"pes of trend anal"sis t!ese areI 1. 4ori8ontal anal"sis 2. Fertical anal"sis .'(.'. HORI+ONTAL ANALYSIS OF BALANCE SHEET OF BALHORI+ONTAL ANALYSIS OF TOTAL ASSETS A: A0 ' De5e<8e1I )(($ M )((* ITEMS (as! and #alance wit! treasur" #anks Balances wit! ot!er #anks In/estments Financings %perating Fi7ed Assets %t!er Assets +otal Assets HLL HLL HL $6 HHE$K H5E$5 H2 $5 2E$65P HK$25P HLL HLL HLL 26$6 H5 $ HH?$H 2 $ HK?$? H2@$? K $6P H6$2P 2@$?P HLL H?? H E K?$5P UFUFUFUFFa/ora#le Fa/ora#le Fa/ora#le Fa/ora#le UFFa/ora#le )(($ HLL )((% HL )((* HH6$K ACe1age 5>a/ge @$ 5P D61e5062/ Na041e 27 T1e/3

UFUF-

Fa/ora#le Fa/ora#le

HORI+ONTAL ANALYSIS OF TOTAL LIABILITES HK

ITEMS Bills )a"a#le B2112F6/g: 712< 20>e1 52<<e156a; 8a/9: De=2:60: a/3 O0>e1 A5524/0: O0>e1 L6a86;60? T20a; ;6a86;606e:

)(($ HLL HLL

)((% HKK$@ 252$E

)((* HHH$ H K$L

ACe1age 5>a/ge 5$@P KH$5P

D61e5062/

Na041e 27 T1e/3

UF-

,nfa/ora#le

UF-

,nfa/ora#le

HLL

HH?$L

H25$5

H2$65P UFFa/ora#le

HLL HLL

HKL$? HH@$

H5?$5 H2 $L

26$25P HKP

UFUF-

,nfa/ora#le ,nfa/ora#le

HORI+ONTAL ANALYSIS OF EJUITY A: A0 ' De5e<8e1I )(($ M )((* I0e<: S>a1e 5a=60a; Ca=60a; Re:e1Ce: T20a; E@460? )(($ )((% )((* ACg. C>a/ge HLL HLL HLL HKL HK@$L HKL$2 H5E$E HH5$H HK@$H 2E$E5 H5$HP HE$L5P UFUFUFD61e5062/ Na041e 27 01e/3 Fa/ora#le Fa/ora#le Fa/ora#le

COMMENTSIn consideration to t!e !ori8ontal anal"sis of #alance s!eet of Bank Alfala! &imited0 it is o#ser/ed t!at t!e #ank !as positi/e impacts$ +!e cas! and #alance wit! ot!er #ank is increasing w!ic! is fa/ora#le for t!e #ank 2 also0 t!e in/estment of t!e #ank is increasing w!ic! is positi/e for t!e #usiness$ If t!e an" #anks in/estment increases its

HK6

means in/estments it en!ances t!e profita#ilit" t!at will increase t!e good will of t!e #ank towards t!e current as well as t!e prospecti/e in/estors$ More and more in/estors will attract towards t!e #ank due to its increasing profits in order to earn !ig!er gains$ %n t!e ot!er !and0 t!e #orrowing of t!e #ank !as #een increasing w!ic! is negati/e for t!e #ank$ +!e #ank !as increased its de#t #urden w!ic! will affect t!e sol/enc" of t!e #usiness$ Also0 t!e periodic interest pa"ments of t!e #ank will increase and t!e #ank !as to #ear !ig! interest e7pense w!ic! will also affect t!e profita#ilit" of t!e #ank$ +!e #ank s!ould decrease its de#t #urden to pa" off its de#t in order to increase its sol/enc" as well as to decrease t!e interest e7pense$ +!e s!are capital of t!e #ank also increases during t!ese "ears w!ic! are positi/e for t!e #ank$ Its means t!e claims of t!e outsiders !a/e decrease in t!e #usiness w!ic! is positi/e towards t!e owner of t!e #ank$ +!e #ank !as to t!e more profit for distri#ution profit among t!e stock!olders and t!e owners also en5o" more profit$ HORI+ONTAL ANALYSIS OF INCOME STATEMENT A: A0 ' De5e<8e1I )(($ M )((* I0e<: I/0e1e:0 ea1/e3 I/0e1e:0 eB=e/:e: I/0e1e:0 6/52<e P12C6:62/ aga6/:0 ;2a/: A a3Ca/5e: Ne0 6/0e1e:0 6/52<e a70e1 =12C6:62/: FeeI 52<<6::62/ a/3 8129e1age 6/52<e HLL HK?$ H?L$ 2L$KP UFFa/ora#le HLL H2E$L HK $K H@$H5P UFFa/ora#le )(($ HLL HLL HLL )((% H2H$ HLE$H H5K$6 )((* H? $5 HKK$? H6E$@ ACg. C>a/ge 2K$25P H $6P KE$EP D61e5062/ UFUFUFNa041e 27 01e/3 Fa/ora#le ,nfa/ora#le Fa/ora#le

HLL

DKKE$@

D2EH$@

5K5$6P

UF-

,nfa/ora#le

HK@

D6C63e/3 I/52<e I/52<e 712< 3ea;6/g 6/ 721e6g/ 5411e/5? O0>e1 6/52<e T20a; /2/ <a194= 6/52<e A3<6/6:01a062/ eB=e/:e: O0>e1 5>a1ge: T20a; /2/ 6/0e1e:0 eB=e/:e: P12760 Be721e TaBa062/ TaBa062/ P12760 a70e1 0aBa062/ COMMENTS-

HLL

H6K$L

@L?$@

K52$?P

UF-

Fa/ora#le

HLL

H22$

2K $K

@$H5P

UF-

Fa/ora#le

HLL HLL

H22$? H@6$2

H?@$H H 2$

25$5?P KH$KP

UFUF-

Fa/ora#le Fa/ora#le

HLL HLL

HL?$@ 22$L

H6@$2 2@K$?

KE$H DH@K$?

UFDF-

Fa/ora#le Fa/ora#le

HLL

H?L

H6E$?

KE$6

UF-

,nfa/ora#le

HLL HLL HLL

H6 $6 K 2$ H66$5

E$E HLL$H 6K$@

DH5$L5 DHEE$E D2 $2

DFDFDF-

,nfa/ora#le Fa/ora#le ,nfa/ora#le

In consideration to t!e !ori8ontal anal"sis of t!e income statement of Bank Alfala! &imited0 it is o#ser/ed t!at t!e #ank !as negati/e impacts o/er t!e past K "ears$ +!e increase in interest e7pense is one of t!e reasons for t!e unfa/ora#le result$ +!e increase in de#t !as caused increase in t!e interest e7pense$ Alt!oug! t!e interest e7pense of t!e #ank Alfala! limited !as increased #ut t!e increase in interest income is more t!an t!e increase in interest e7pense w!ic! is also fa/ora#le for t!e #ank$ +!e administration e7penses of t!e #ank Alfala! limited !a/e also increased w!ic! cause t!e decrease in profita#ilit" of t!e #ank$ +!e increase in administration e7penses s!ow t!at t!e management of t!e #ank is not properl" utili8ing its resources and putting t!em into work$ +!e management s!ould utili8e t!e #ank resources properl" in order to reduce

HKE

its e7penses w!ic! will en!ance t!e profita#ilit" of t!e #ank in t!e future$ +!e profita#ilit" of t!e #ank !as #een decreasing w!ic! is unfa/ora#le for #ank Alfala! limited 2 it will decrease t!e confidence of t!e current in/estors as well as prospecti/e in/estors will not in/est in t!e #ank Alfala! limited$ +!e decrease in profita#ilit" is also fa/ora#le for t!e #ank Alfala! limited #ecause it will decrease t!e ta7 e7pense of t!e #ank$

H?L

VERTICAL ANALYSIS VERTICAL ANALYSIS OF INCOME STATEMENT A: A0 ' De5e<8e1I )(($ M )((* I0e<: I/0e1e:0 eB=e/:e3 Le::- interest e7pense Net Spread %t!er -7penses )rofit Before +a7ation )rofit After +a7ation )(($ )((% )((* ACg. C>a/ge HLL 6H$HP ? P HLL ?$?P K5$ P HLL 5$?P K?$ P K?$5P 5$6@P H$5@P DDDDDDD $$.&E *.%E '.*E ''.%E .$(E DFUFU FDFU FDFD61e5062/ Na041e 27 01e/3 Fa/ora#le Fa/ora#le Fa/ora#le Fa/ora#le Fa/ora#le Fa/ora#le

2@$EP K2$HP H2$HP H6$5P K$6EP 5$?5P

VERTICAL ANALYSIS OF BALANCE SHEET VERTICAL ANALYSIS OF BALANCE SHEET (ASSETS) A: A0 ' De5e<8e1I )(($ M )((* I0e<: (as! Balances wit! #anks &ending financial institutions In/estments Ad/ances fi7ed assets %t!er assets T20a; A::e0: )(($ )((% )((* ACg. D61e5062/ UFUFNa041e 27 01e/3 Fa/ora#le Fa/ora#le C>a/ge E$K P E$?6 $H@P 5$?5

HL$HP @$E5P

ot!er ?$ HP 5$5@P to ?$5HP H$L?P 2L$?P 5?$?P K$@LP 2$H@P '((E 2 $EP 52$LEP K$ 2P H$@2P '((E

L$E5P 2$H 2?$6P 52$LP K$E?P 2$@6P '((E 2? 52$@K K$5? 2$2E

UFUFUFUFUF-

Fa/ora#le Fa/ora#le Fa/ora#le Fa/ora#le Fa/ora#le

H?H

VERTICAL ANALYSIS OF BALANCE SHEET (LIABILITIES) AS AT ' DECEMBERI )(($I )((%I )((* I0e<: +otal &ia#ilities +otal -Cuit" T20a; L6a86;606e: A E@460? )(($ )((% )((* ACg. C>a/ge E $H?P K$@ P E5$6@P E5$6@P E5$EP ?$22P ?$22P $H5P UFU FD61e5062/ Na041e 27 01e/3 ,nfa/ora#le Fa/ora#le

'((

'((

'((

H?2

.'(.). GRAPHICAL REPRESENTATION OF VERTICAL ANALYSIS

INTREST EXPENSE

65.4

71.1 2006 2007 2008

64.4

NET SPREAD

34.6 46 2006 2007 2008

35.6

H?K

OTHER EXPENSES

28.9 34.5 2006 2007 2008

32.1

PROFIT AFTER TAXATION

1.58 3.79 2006 2007 2008

5.45

H??

PROFIT BEFORE TAXATION

5.78 12.1 2006 2007 2008

17.5

CASH

9.36

10.1 2006 2007 2008

8.95

H?5

BALANCES WITH OTHER BANK

4.61 6.18 2006 2007 2008

5.58

LENDING TO FINANCIAL INSTITUTIONS

0.95

1.04

2006 2007 2008 4.51

H?

INVESTMENTS

24.7

20.4 2006 2007 2008

26.9

ADVANCES

52

54.4 2006 2007 2008

52.09

H?6

FIXED ASSESTS

3.94

3.8 2006 2007 2008

3.62

OTHER ASSESTS

2.18 2.87 2006 2007 2008

1.82

H?@

TOTAL LIABITIES

95.78

96.14 2006 2007 2008

95.78

TOTAL EQUITY

4.22

3.86 2006 2007 2008

4.22

H?E

.''. FUTURE PROSPECTS OF THE ORGANI+ATION+!e future of t!e industr" portends prosperit" for BA&0 wit! ma5or restructuring taking place in t!e econom"0 and t!e increasing concentration of a few large institutions !as propelled BA& to focus on strategic e7cellence$ +!e en/ironment not onl" instills in t!e entire BA& team a sense of !eig!tened competition #ut also t!e relentless pursuit of rising a#o/e t!e fierce c!allenges t!e industr" !as to offer$ In /iew of t!e a#o/e we !a/e come up wit! product de/elopment and ser/ice and Cualit" assurance departments to identif" t!e gaps in t!e market0 profita#l" fulfill t!em #" de/eloping premium products and offering t!em to our customers t!roug! our counters coupled wit! ser/ice #e"ond distinction$ BA&.s management is increasingl" focusing on t!e ser/ice Cualit" aspect to increase retention rate t!roug! organi8ed programmes as t!e 'old Standard Ser/ice$ +!e program !as met spirited response and is #eing implemented to increase efficienc" le/els internall" and e7ternall"$ .'). INDUSTRY ANALYSIS WITH OTHER ORGANI+TIONBA& is a large con/entional #ank in )akistan from last "ears its position goes down #ut not t!at muc! as compare to its competitors$ BA& onl" one #ranc! earns !uge profit e/er" "ear #ut like A&&I-D BAN3 t!e" !a/e num#er of #ranc!es #ut t!at are not eCual in profit generation as BA&$ BA& pro/ide inno/ati/e ser/ices and products to t!eir customers #ut like A&&I-D BAN3 t!e" pro/ide small range of products and facilities to t!eir customers$ BA&.s team.s firm determination is /er" strong and t!e" are lia#le to t!eir #ank too muc! and #ank gi/es t!em incenti/e in large amount and t!e" are satisfied$ &ast "ear t!e 'u5ranwala #ranc! earns K #illions profits0 and t!e" also pro/ide trade facilities to t!eir customers #ut most of t!e #anks are not pro/ided suc! kinds of facilities to t!eir customers$ From anal"sis it is pro/ed t!at #ank !as a lot of assets to pa" its lia#ilities as compare to its competitors$ -conomic factors effect on t!e profita#ilit" of t!e BA& #ut not t!at muc!$ &ike t!e recent merger of t!e K #anks and t!e" #ecome t!e SI&3 BAN3$ BA& will ac!ie/e its pre/ious well known status easil" soon$

H5L

!. SWOT ANALYSIS
STRENGTHS Bank Alfala! is considered to #e a /er" sound #ank in t!e financial circles a #ank0 w!ere t!e customers can safel" keep t!eir mone" as long as t!e" want$ I am pointing some of t!e ma5or strengt!s of t!e #ankI COMPASSIONATE CUSTOMER SERVICE +!e officers of BA& are considered as one of t!e most a#le professionals in t!e #anking world (some #elong to B((I)$ 4owe/er0 t!e" !a/e added some local fla/or in accordance wit! t!eir targeted segmented$ -speciall"0 in '$+ *oad Branc!0 I o#ser/ed t!at t!e" interact wit! t!eir clients as if t!e" are t!eir personal friends and discuss a#out t!eir pro#lems as t!eir own$ GOODWILL A TRUST As a result of t!e compassionate and personali8ed ser/ices of t!e officers0 t!e clients. perception for BA& is /er" !ig!$ +!e" !a/e trust and feel t!emsel/es to #e secure w!ile dealing wit! BA&$ t!e #ank !as efficient and Cualified management$ +!e management !as a keen o#ser/ation on future aspects w!ic! pla" a ke" role in #ank success$ LOCATION Bank Alfala! !as opened all its #ranc!es at commercial areas so t!at t!e customers or clients face no pro#lems in reac!ing to t!e #ank$ For e7ample0 '$+ *oad #ranc! for #eing situated in #usiness and commercial !u# of 'u5ranwala !as second largest /olume in trade finance$ FOREIGN TRADE BUSINESS +!e #ank is focusing on +rade Finance it s!ows a great significance to t!e de/elopment and maintenance of !ealt!" correspondent relations!ips wit! ot!er #anks and financial institutions$ +owards t!is pursuit0 BA& !as de/eloped e7cellent #usiness relations wit! foreign #anks0 w!ose support in terms of lines of credit e7tended to t!e #ank0 !as ena#led it to !andle t!e e/erDgrowing trade /olumes$ WIDE BRANCH NETWORK Bank Alfala!.s o#5ecti/e !as #een to e7pand its #ranc! network to meet clients. needs$ It

H5H

is !eartening to note t!at in 5ust fi/e "ears0 w!ic! is considered t!e infanc" stage in t!e industr"0 t!e #ank !as increased t!e #ranc! network from 26?$ And0 due to t!e growing #usiness reCuirements0 t!ere are furt!er more proposed #ranc!es in different cities$ +!e e7pansion program is strategicall" important to increase customer #ase and to approac! different customer segments$ *ecentl" one more new #ranc! open in 'u5ranwala$ THE COMPUTERI+ED SYSTEM BA& !as got a relia#le and eas" to use internal computer s"stem$ -/er" information regarding t!e transactions in customers. deposits !as #een computeri8ed$ [Bank e7cel is #eing practiced for t!is purpose #ut now0 a new program named [Bank smart is functioning /er" efficientl" and accuratel"$ TREND SETTER Bank Alfala! is a trend setter and alwa"s goes to e7plore t!e risk" market$ +!is !elps t!e #ank to meet new c!allenges in order to compete in t!e #anking sector of t!e countr" and also to attract more customers #ot! wit! in and outside t!e countr"$ WEAKNESSES )erfection is onl" t!e claim of Alla! Almig!t"$ No ot!er #eing li/ing or dead can sa" t!is for itself$ Similarl"0 Bank Alfala! also !as some s!ortcomings t!at need to #e mentionedI ADVERTISEMENT I0 6: a;1ea3? 326/g <45> a3Ce106:e<e/0 BA& !as formuli8ed a lot of products and ser/ices for its customers0 e/en more t!an ot!er commercial #anks0 #ut an" ad/ertisement on electronic media !as not #een seen$ Since0 BA&.s ma5or competitor ,nion Bank &imited !as started large media campaign0 so keeping in /iew t!ese t!reatsQ Bank Alfala! s!ould emp!asi8e more on its ad/ertisement$ PROBLEMS OF EMPLOYEES I o#ser/ed during m" interns!ip t!at some of t!e emplo"ees were #urdened wit! o/er work$ So I t!ink t!at t!e work s!ould #e distri#uted according to t!eir post and capa#ilities$ WORK LOAD I o#ser/ed t!at t!e emplo"ees of BA& facing !ea/" load of work and t!e" go #ack !ome

H52

@ or E )$m$ it.s not good for t!e !ealt! of emplo"ees and for personal life also$ LACK OF INCENTIVES +!e #ank lack incenti/es to moti/ate t!e emplo"ees$ Due to t!is reason t!ere is a !ig! emplo"ee turno/er rate$ +!e emplo"ees of !ig!er ranks are gi/en incenti/es in t!e form of #onuses #ut t!e emplo"ees of lower rank are totall" ignored$ LACK OF COMMUNICATION +!ere is lack of upward communication$ Also t!ere are #arriers in !ori8ontal communication due to lot of professional 5ealous"$ NO HUMAN RESOURCE DEPARTMENT In t!is #ranc! no specific !uman resource department for t!e !iring and firing of emplo"ees and for t!e satisfaction of emplo"ees OPPORTUNITIES Bank Alfala! !as grown up its #usiness wit! a /er" !ig! pace and it !as got tremendous popularit"0 e/en wit! in a /er" s!ort span of time$ +!ere are man" opportunities for t!e #ank and #" a/ailing t!at it can stand amongst t!e top foreign #anks$ INFORMATION TECHNOLOGY All t!e opportunities of t!e 2Hst centur" are to #e a/ailed in t!e information tec!nolog"$ Information tec!nolog" is t!e future of t!is d"namic world$ +!erefore BA& s!ould emp!asi8e muc! on I+0 especiall" on -DBanking$ Bank can design a uni/ersal account like ot!er foreign #anks0 to en!ance online facilities$ EXTENSION OF BRANCH NETWORK Bank Alfala!.s growing #usiness reCuires an e7tensi/e #ranc! network$ +!ere are great opportunities for BA& for t!e e7pansion of its #usiness$ GROWTH IN DEPOSITS BA& !as introduced a num#er of financial sc!emes including special [*o"al Accounts.$ +!ese accounts !a/e t!eir uniCue features (discussed earlier)$ During t!e last t!ree "ears0 BA&.s deposits !a/e #een increasing b KLP0 w!ic! is a /er" !ealt!" sign$ +!erefore0 wit! t!e commencement of new sc!emes t!ere can e/en #e a greater increase in its deposits$ THREATS ECONOMIC CONDITIONS

H5K

Despite t!e difficult circumstances t!at confronted t!e #anking sector in particular and t!e countr" in general0 Bank Alfala! !as #een still !ig!l" profita#le$ But0 t!e facts can.t #e denied and t!ere mig!t #e an ad/erse impact of suc! situation$ COMPETITORS Bank Alfala! is facing a strong competition #" its ma5or competitors0 [,nion Bank. and [Askari (ommercial Bank.$ Business of t!ese #anks is also growing wit! /er" !ig! pace$ +!e S9%+ anal"sis of t!e #ank signifies t!at its strengt!s o/ercome its weaknesses and its opportunities are more t!an its t!reats$ +!is is a positi/e sign for an" organi8ation$

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5$RECOMMENDATIONS

I spent si7 weeks of m" interns!ip in BA& '$+ *oad Branc!0 'u5ranwala$ During t!ese si7 weeks0 I felt m"self to #e a part of BA&$ -/en0 t!is was m" first e7perience of working in a #anking organi8ation0 #ut I learned a lot from t!is e7perience$ Based on m" e7perience 2 o#ser/ation regarding t!e operations and policies of Bank Alfala!0 I !a/e tried to stipulate some recommendations for furt!er impro/ement$ MARKETING BA& !as formuli8ed a lot of products and ser/ices for its customers0 e/en more t!an ot!er commercial #anks0 #ut an" ad/ertisement on electronic media !as not #een seen$ So0 I t!ink t!at t!ere s!ould #e a proper marketing department and ad/ertisement e7penditures of t!e #ank s!ould also #e increased to impro/e its /isi#ilit" and to pu#lici8e its financial sc!emes$ ENHANCED COMPUTER NETWORK +!e #ank s!ould emp!asi8e muc! on computer tec!nolog"$ &ike ot!er #anks0 BA& s!ould en!ance its onDline ser/ices$ Bank0 also s!ould concentrate on -D#anking and use of A+M$ Moreo/er0 #ank s!ould also emp!asi8e on en!ancing its we#site information$ %ne draw#ack t!at I o#ser/ed in '$+ *oad Branc! was manual preparation of negotia#le instruments like )%0 DD etc$ Due to growing #usiness reCuirements of concerned #ranc!0 it s!ould #e pro/ided more facilities$ EXPANSION IN BRANCH NETWORK Bank Alfala!.s #usiness !as grown wit! a tremendous pace$ +!ere !a/e #een considera#le profits 5ust wit! in a s!ort span of time$ +!erefore0 due to t!e e7panding #usiness reCuirements0 BA& s!ould e7pand its #ranc! network to capture ot!er #usiness markets$ TRAINING FACILITIES AND SEMINARS 4uman resource constitutes t!e most /alua#le asset for an organi8ation$ +o impro/e t!e professional skills and Cualit"0 BA& !as started si7Dmont!s compre!ensi/e training program t!at is reall" a commenda#le step taken #" BA&$ Bank0 apart from t!is program0 conduct some training programs for e7isting emplo"ees to impro/e t!eir proficienc"$ Also0 Bank Alfala! s!ould arrange some seminars to make its /isions and o#5ecti/es0 H55

clear to e/er" one$ EJUAL STATUS OF BRANCHES %ne ma5or 2 alarming draw#ack t!at I o#ser/ed in '$+ *oad$ Branc!0 is t!e inferiorit" comple7 faced #" some emplo"ees$ BA& '$+ *oad Branc!0 for #eing situated in #usiness and commercial !u#0 !as its unusual importance and !as !uge foreign trade #usiness$ But I o#ser/ed some emplo"ees to #e t!e /ictim of comple7$ So0 to a/oid suc! discrepancies0 seminars s!ould conduct to signif" t!e importance of eac! #ranc!$ EXPANSION A RECRUITMENT IN G.T ROAD BRANCH BA& '$+ *oad$ Branc! !as !uge #usiness /olume0 w!ereas t!e staff is not enoug! to meet t!ese reCuirements$ I found t!at some emplo"ees were #urdened wit! o/erwork0 e/en some clients. complaint for t!e slow ser/ice$ +!erefore0 more staff s!ould #e recruited$ Also0 t!ere s!ould #e an e7pansion in t!e area of #ranc! to meet t!e reCuirements of growing #usiness transaction$

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$ CONCLUSION +!e time duration of m" interns!ip was of si7 weeks$ I !a/e learnt a lot a#out t!e #anking functions$ Bank Alfala! is pla"ing a ke" role in t!e #anking sector in )akistan$ It was esta#lis!ed in HEE@ and de/eloped /er" effecti/e growt! strategies$ As a result of t!is t!e #ank progressed so well t!at in t!e s!ort time of si7 "ears it !as #ecome one of t!e leading #anks in )akistan$ Its profita#ilit" !as increased a#out 65P as compared to t!e pre/ious "ear$ As mentioned in its mission statement t!at it pro/ides inno/ati/e products and ser/ices to its customers$ +!is makes t!is #ank different from ot!er #anks$ Bank strateg" is to ma7imi8e t!e s"nergies of #ranc! network t!oug! an optimal allocation of financial0 !uman and ot!er recourses in order to meet t!e d"namic c!allenges of present financial en/ironment$ +!e recruitment and training policies of t!e #ank are according to t!e latest reCuirements so t!e emplo"ees are moti/ated and work efficientl" and effecti/el"$ But t!e incenti/e s"stem is weak and t!is is t!e main reason w!ic! makes t!e emplo"ees at lower le/el less moti/ated t!an t!e emplo"ees of t!e !ig!er le/el$ +!e #ank s!ould make its policies #" considering t!e present conditions of t!e #anking sector in order to compete in toda".s world$

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BIBLIOGRAPHY
All t!e information mentioned in t!is report is gat!ered from t!e following sources$ o We8:60e: www$#ankalfala!$com$ www$google$com www$wikipedia$com www$#usinessrecorder$com www$in/estopedia $com www$pakistaneconomist$com www$#usinessrecorder$com www$kse$com$pk o O0>e1 :2415e: ANNUAL REPORT BANK ALFALAH LIMITED ()(($I )((%I )((*) EMPLOYEES AT BANK ALFALAH o Ma/4a;: Branc! Manger Mr$ S!eik! Masood -la!ee B" miss Maria 3!an ((*%) BG Miss Saira (!ud!ar" (+rade Manger) BG Miss 4ina (Accounts %fficer) BG Mr$4am"oun Masood Mal!ee o B229 Financial Statement Anal"sis BY- C>a1;e: H. G68:2/ 6t! -dition

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GLOSSARY
B4:6/e:: A5524/0 +!is account is related to t!e #usiness communit"$ C411e/0 a5524/0 (urrent accounts are t!ose accounts in w!ic! we gi/e no profit to customer on t!eir deposits$ De7e11e3 TaBa062/ Sum set aside for ta7 in t!e Financial Statements t!at will #ecome pa"a#le in a financial "ear ot!er t!an t!e current financial "ear$ EB=210 -7port is t!e actual s!ipment0 transfer0 or transmission of items out of a countr"Q a transfer of good or tec!nolog" wit! knowledge or intent t!at t!e goods or tec!nolog" s!ipped0 transferred0 or transmitted to an aut!ori8ed recipientQ or t!e transfer of goods or information in a countr" to an em#ass" or consulate of a foreign$ M2/e? g1a< Mone" 'ram0 offers remittance ser/ice to )akistan$ Mone" 'ram is personDtoDperson mone" transfer ser/ice t!at allows consumers to recei/e mone" in 5ust a few minutes$ Ma19e0 Ca=60a;6Da062/ Num#er of ordinar" s!ares in issue multiplied #" t!e market /alue of s!are as at t!e "ear end$ Ne0 D6C63e/3: Di/idend net of wit!!olding ta7 Ne0 I/0e1e:0 I/52<e +!e difference #etween w!at a #anks earns on assets suc! as loans and securities and w!at it pa"s on lia#ilities suc! as deposits0 refinance funds and interD#ank #orrowings$ N2/ Pe1721<6/g L2a/: A loan placed on cas! #asis (i$e$ Interest Income is onl" recogni8ed w!en cas! is recei/ed) #ecause in t!e opinion of management0 t!ere is reasona#le dou#t regarding t!e collect a#ilit" of principal or interest$ &oans are automaticall" placed on cas! #asis w!en a pa"ment is K mont!s past due$ All loans are classified as nonperforming w!en a

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pa"ment is K mont!s in arrears$ O/;6/e 8a/96/g Nuantum of settlement wit!in different #ranc!es is apprecia#le #ecause of updating dail" record$ P165e Ea1/6/g: Ra062 (PLE Ra062) Market price of a s!are di/ided #" earnings per s!are$ Re041/ 2/ ACe1age A::e0: )rofit after ta7 di/ided #" t!e a/erage assets$ Re=415>a:e Ag1ee<e/0 (ontract to sell and su#seCuentl" repurc!ase securities at a specified date and price$ Re041/ 2/ aCe1age E@460? Net profit for t!e "ear0 less preference s!are di/idends if an"0 e7pressed as a percentage of a/erage ordinar" s!are!olders. eCuit"$ ReCe/4e Re:e1Ce *eser/es set aside for future distri#ution and in/estment$ SaC6/g a5524/0 Sa/ing accounts are t!ose accounts in w!ic! t!e #ank gi/es t!e customers profit on t!eir deposits$ S>a1e>2;3e1:, F4/3: +otal of Issued and full" paid s!are capital and capital and re/enue reser/es$ Te1< 3e=2:60 a5524/0 In t!is account t!e customer gets its amount fi7ed for a specified period of time$

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PERSONAL INFORMATION

Sttudent Name Student ID Student (ontact Num#er

Student Address

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