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TABLE OF CONTENTS
Objectives of Studying the Organization........................................................................................................................5

Brief History of United Bank Limited............................................................................................................................6

Nature of United Bank Limited......................................................................................................................................8

Business Volume of United Bank Limited.....................................................................................................................9

Branch Network of United Bank Limited.....................................................................................................................10

Number of Employees of United Bank Limited...........................................................................................................11

Product Lines................................................................................................................................................................13

1. Deposits...........................................................................................................................................................13

a) UBL Business Partner.................................................................................................................................14

b) Rupee Transactional Account.....................................................................................................................15

c) UBL Basic Banking Account- BBA...........................................................................................................16

d) UBL Uniflex Account.................................................................................................................................17

e) UBL Unisaver Account...............................................................................................................................18

f) UBL E- Transaction Account......................................................................................................................19

g) Certificate of Deposit (COD)......................................................................................................................19

h) Regular Term Deposits Receipts.................................................................................................................20

i) Foreign Currency Savings...........................................................................................................................21

j) Foreign Currency Term Deposits Receipts.................................................................................................22

2. Advances (Cards & Loans)..............................................................................................................................23

a) UBL Credit Card - Chip Credit Card..........................................................................................................23

b) UBL Wiz - Pakistan’s First Prepaid Visa debit Card..................................................................................26

c) UBL Wallet - Visa ATM Debit Card..........................................................................................................26

d) UBL Address - Home Loan Facility...........................................................................................................28

e) UBL Businessline - Business Financing Loan............................................................................................31

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f) UBL Cashline - Running Finance Facility..................................................................................................32

g) UBL Drive - Auto Loan..............................................................................................................................34

h) UBL Agricultural&nbspLoan.....................................................................................................................35

i) UBL Small Business - SME Loan...............................................................................................................36

3. Remittances.....................................................................................................................................................37

a) Demand Drafts............................................................................................................................................37

b) Travelers Cheques.......................................................................................................................................37

c) Letter Of Credit...........................................................................................................................................38

d) Foreign Remittances....................................................................................................................................38

e) Swift System...............................................................................................................................................39

f) Mail Transfer...............................................................................................................................................39

g) Telegraphic Transfer...................................................................................................................................40

h) Pay Order.....................................................................................................................................................40

4. Miscellaneous..................................................................................................................................................40

a) UBL Tezraftaar...........................................................................................................................................40

b) UBL Tezraftaar Cash..................................................................................................................................41

c) Hamrah........................................................................................................................................................41

d) UBL Net Banking........................................................................................................................................42

e) UBL E-Statement........................................................................................................................................42

Organizational Structure of United Bank limited.........................................................................................................44

Organizational (Management) levels at UBL...............................................................................................................45

Top Managers...........................................................................................................................................................45

Middle Managers......................................................................................................................................................46

First Line Managers or Lower Level Management..................................................................................................46

Non Managerial Employees......................................................................................................................................46

Hierarchy of United Bank Limited...............................................................................................................................47

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Organization Structure of the Branch...........................................................................................................................48

a) Centralized Decision Making..........................................................................................................................48

b) Downward Communication.............................................................................................................................49

c) Chain of Command..........................................................................................................................................49

d) Authority and Responsibility...........................................................................................................................50

e) Delegation........................................................................................................................................................50

Departments of the Branch...........................................................................................................................................51

1. Clearing House Department............................................................................................................................51

2. Remittance Department...................................................................................................................................55

3. Account Opening Department.........................................................................................................................58

4. Cash Department.............................................................................................................................................59

5. Deposits Department.......................................................................................................................................61

6. Advances Department......................................................................................................................................61

7. Computer Department.....................................................................................................................................63

a) Online branches...........................................................................................................................................63

b) Batch Branches............................................................................................................................................63

c) Manual Branches.........................................................................................................................................63

8. Pension Disbursement Department.................................................................................................................65

9. Accounts Department......................................................................................................................................65

Structure of Branch’s Accounts Department................................................................................................................68

Bank Accounting Operations........................................................................................................................................71

Role Of CFO (Chief Financial Officer)........................................................................................................................73

Use of Electronic Data in Decision Making.................................................................................................................77

Information System Resources of UBL....................................................................................................................78

a) People Resources.........................................................................................................................................78

b) Hardware Resources....................................................................................................................................78
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c) Software Resources.....................................................................................................................................79

d) Data Resources............................................................................................................................................79

e) Network Resources.....................................................................................................................................79

Sources of Funds...........................................................................................................................................................80

Generation of funds......................................................................................................................................................81

Allocation of Funds......................................................................................................................................................82

Critical Analysis (Theory vs Practical).........................................................................................................................83

Balance Sheet................................................................................................................................................................84

Income Statement.........................................................................................................................................................85

Financial Statements Analysis......................................................................................................................................87

Ratio Analysis...........................................................................................................................................................88

Horizontal Analysis..................................................................................................................................................89

Horizontal Analysis of Balance Sheet......................................................................................................................90

Horizontal Analysis of Income Statement................................................................................................................91

Vertical Analysis.......................................................................................................................................................92

Vertical Analysis of Balance Sheet..........................................................................................................................93

Vertical Analysis of Income Statement....................................................................................................................94

Bank Analysis with reference to commercial Banks listed on stock exchange............................................................95

Future Prospects of United Bank Limited....................................................................................................................98

Short falls/ Weaknesses of United Bank Limited.........................................................................................................99

Conclusions.................................................................................................................................................................100

Recommendations.......................................................................................................................................................101

References...................................................................................................................................................................102
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OBJECTIVES OF STUDYING THE ORGANIZATION

The primary purpose of this study is to fulfillment of the requirements for the degree of MBA
(Banking & Finance).For this connection each student of this particular course is required to
undertake training in a relevant organization selected by them, for a period of 6-8 weeks.
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The secondary purpose of this internship is to understand how the theoretical knowledge can be
applied to the practical situations and examine an organization’s financial issues and identify its
opportunities/ problems and also suggest corrective measures. This internship is also very
necessary to gain confidence and become aware of the mechanism of an organization. As an
internee I want to achieve following objectives during my internship and organization study:

1. To familiarize with a business organization.

2. To familiarize with the different departments in the organization and their functioning.
3. To enable myself to understand how the key business process are carried out in
organization.
4. To understand how information is used in an organization for decision making at various
levels.
5. To relate theory with practice.
6. I was also keen to gain professional experience in an actual testing environment.
7. I want to develop my skills in the application of theory to practical work situations.
8. To develop my attitude conducive to effective interpersonal relationships.
9. To acquire good work habits and sense of responsibility.
10. To enhance my learning experience by application of fundamental concepts previously
learned.

11. To observe, analyze and interpret the relevant data competently and in a useful manner.

12. To develop my interpersonal communication.

13. I want to enhance my knowledge of the discipline of banking administration.

BRIEF HISTORY OF UNITED BANK LIMITED

History of banking in Pakistan stands with partition. At the time of independence there were 487
offices of schedules banks in territories now consisting Pakistan. But after the announcement of
independence plan, the banking services in Pakistan was seriously suffered the banks transferred
their registered offices from Pakistan to India. So, by 30th June 1948, the number of office
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schedule banks in Pakistan declined from 487 to 195. In June 1959, Mr. Agha Hassan Abedi
decided to open a bank different from other to provide modern banking facilities to trade and
industry and to promote the habit of saving among common people. Necessary formalities have
been compiled for registration certificate to perform business to STATE A\BANK OF
PAKISTAN for permission. After all these formalities on 7 th November 1959, UBL came in to
existence as a schedule bank. Head office was established in New Jubilee Insurance House;
I.I.CHUNDRIGAR ROAD KARACHI. It was registered as Joint Stock Company. The bank
was incorporated with an authorized capital of Rs.20million, which was later rose up to
Rs.96million.

Mr.I.ICHUNDRIGAR was its chairman who died in December 1960 and was replaced by
Mr.Habib-I-Rehmat. Mian Shafique Saigul was its managing director who was replaced by
Mr.Agha Hassan Abedi in 1962, after nationalized MrA.K Yousaf was appointed as managing
director for a short while and later on designated as president; he was replaced by Mr.Aia-ud-din
in on 1st January 1997.Progress of this estimated institute could be measured in terms of deposits
and number of branches opened. UBL have been ranked as number three banks in Pakistan in
terms of deposits and branches.1

In 1963 first overseas branch was opened in London, in 1966 two branches in Bradford and
Birmingham were also opened in 1967 Dubai and Abu Dhabi branches were opened. More
important thing is that UBL is pioneer in computerization of banking. Its larger branches are
fully computerized. Saving and current deposit art computerized in almost all branches. Now
UBL is on the road of growth with reference to market share and network.

Consensus on the origination of word “Bank” is not yet reached at. Some author’s opinion is that
this word is derived from the words “Bancus” or “Banque”, which mean a bench and they further
relate banking business inception to Jews in Lombardy. Other authorities state that the word
“Bank” is derived form the German word “Back” which means “Joint Stock fund” and later on

1
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due to German occupation of Italy, this word was Italianated into “Bank. Authors quote
Babylonians (few quotes Chinese) who developed banking system as early as 2000. B.C1

UBL is one of the largest commercial banks in Pakistan having more than 1,000 branches inside
the country. Its 15 branches outside the country are in the United States of America, Qatar, UAE,
Bahrain, and Republic of Yemen. It also has representative offices in Teheran, Iran, and Almaty,
Kazakhstan. Agha Hasan Abedi founded the bank in 1959. In 1971 the Government of Pakistan
nationalized it. In 2002, the Government of Pakistan sold it in an open auction to a consortium of
Abu Dhabi Group and Best way Group. Since its privatization the bank has been successfully
turned around and remains a robust and strong performer in all major segments of its operations.

NATURE OF UNITED BANK LIMITED

The Bank was incorporated in Pakistan and is engaged in commercial banking and related
services. The Bank is listed on all the three stock exchanges of Pakistan. The Bank operates 1078
branches inside Pakistan including the Karachi Export Processing Zone branch and 17 branches
outside Pakistan. The domestic branch network includes 5 Islamic Banking Branches.
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The Bank’s principal activities are to provide commercial banking and other financial services.
The Bank offers personal banking, cash management, retail loans and other financial services.
These services include deposits, savings/current bank account, vehicle loans, personal loans,
retail trade finance, global banking, lending to priority sector and small scale sector, foreign
exchange and export finance, corporate loans and equipment loans.

UBL is a commercial bank, which transacts the business of banking in accordance withthe
provisions of BCO, 1962. Section 7 of the Act authorizes banks to engage in the prescribed form
of business. In the light of this section UBL’s functions can be categorized as under:
 Agency services
 General Utility Services
 Underwriting of loans raised by the Government or public bodies and trading by
corporations etc.
 Providing specialized services to customers, and
 Hajj-related services

BUSINESS VOLUME OF UNITED BANK LIMITED

Rupees in
Millions          
Year   2004 2005 2006 2007 2008
Total Assets 553,231,467 577,719,114 645,132,711 762,193,593 817,758,326
Deposits   465,571,717 463,426,602 501,872,243 591,907,435 624,939,016
Advances 220,794,075 268,838,779 316,110,406 340,677,100 412,986,865
Reserves   10,813,914 13,536,041 13,879,260 15,772,124 19,941,047
Investments 149,350,096 156,985,686 139,946,995 210,787,868 170,822,491
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Horizontal
    Analysis (%)    
Total Assets 100 104 117 138 148
Deposits   100 100 108 127 134
Advances 100 122 143 154 187
Reserves   100 125 128 146 184
Investments 100 105 94 141 114

BRANCH NETWORK OF UNITED BANK LIMITED

UBL has a large network of branches, which extends to the remotest areas of the country. In
December 1983, there were 1623 branches whereas in 1974 it had only 1238 branches and in
2009 these figures show total number of1112 Domestic and 17 overseas Branches.UBL has been
very active in increasing its overseas branches network. The first foreign branches were
established in London in 1963. Now UBL has branches in Bahrain, Qatar, Saudi Arabia, United
Arab Emirates, Yemen Arab Republic, UK Switzerland, Egypt, Oman and The United States.
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These branches are playing a significant role in channeling home remittances and foreign trade
of Pakistan.
SUBSIDIARIES
UBL has four subsidiaries, namely:
 United National Bank Limited (UNB), UK
 United Bank AG (Zurich), Switzerland
 United Executers and trustees Company Limited
 United Bank Financial Services (Private) Limited

NUMBER OF EMPLOYEES OF UNITED BANK LIMITED

Permanent       9520
Temporary/ On Contractual basis   12
Bank's own staff strength at the end of the year 9532
Outsourced       5522
Total Staff Strength     15054
An employee may be defined as: "A person in the service of another under any contract of hire,
express or implied, oral or written, where the employer has the power or right to control and
direct the employee in the material details of how the work is to be performed." 1An employee
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contributes labor and expertise to an endeavor. Employees perform the discrete activity of
economic production. Of the three factors of production, employees usually provide the
labour.Specifically, an employee is any person hired by an employer to do a specific "job". In
most modern economies, the term employee refers to a specific defined relationship between an
individual and a corporation, which differs from those of customer, or client.The relationship
between National Bank of Pakistan and its employees is usually handled through the Human
Resource Management & Administration Group & Employees benefit disbursement & trustee
division. These groups handle the incorporation of new hires, and the disbursement of any
benefits which the employee may be entitled, or any grievances that employee may have.

There are differing classifications of workers withinUnited Bank Limited, these are:

Permanent
Temporary / On Contractual
Outsourced

The Employees of United Bank Limited are organizing into trade unions, which represent most
of the available work force in United Bank Limited. These trade Unions utilize their
representative power to collectively bargain with the management of bank in order to advance
concerns and demands of their membership.

PRODUCT LINES
The most precise definition of product is anything capable of satisfying needs, including tangible
items, services and ideas. In marketing,a product is anything that can be offered to a market that
might satisfy a want or need.2 Since 1575, the word "product" has referred to anything produced.
Since 1695, the word has referred to "thing or things produced”. The economic or commercial
meaning of product was first used by political economist Adam Smith.In general usage, product
may refer to a single item or unit, a group of equivalent products, a grouping of goods or
services, or an industrial classification for the goods or services. The consumer banking products
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include personal accounts, credit cards, loans, investment products, treasury products and many
more. The National Bank of Pakistan offering for sale several related products individually,
which is commonly known as product lining. A product line is defined as “A group of products
that are closely related because they function in a similar manner, are sold to the same customer
groups, are marketed through same types of outlets, or fall within the given price ranges”. 3The
followings are the main consumer banking products of UBL.

1. DEPOSITS
Our mission is to serve all your corporate needs and ensure your full satisfaction through product
innovation, personalized banking, and top notch service.
The CBG department of UBL defines corporate banking in Pakistan. Amongst the local banks
UBL CBG is the pioneer in providing innovative solutions to its diversified and satisfied
customer base. UBL CBG is considered to be a major player in the financial market of Pakistan.
The Corporate Banking Group focuses on attracting and servicing large portfolio customers. Our
forte is providing exemplary customer service using the "Single Window" concept and product
superiority. The Relationship Management team manned by highly qualified individuals from the
industry has steadily expanded our customer base and continues to enhance our cordial relations
with our esteemed clients.
Despite the sluggish economic growth in recent years, UBL outperformed all the other local
banks in the corporate banking sector primarily due to CBG's emphasis on establishing and
enhancing relationships with foreign/local blue chip and middle market customer’s thereby
capturing significant market share.
UBL's appetite for large exposures coupled with dedicated Structured Finance Unit, and an
innovative team of professionals having extensive experience of Corporate Banking gives it the
right platform to succeed in todays competitive and a demanding environment.
The success of CBG has been established from the fact that UBL received the 'No.1 Euro money
2000' Best Local Bank award and recognized it to have out performed all other banks. In year
2000, UBL was also voted as the best Corporate Bank by the customers of a major foreign bank
in a survey. Aggressive marketing combined with professionalism has led to an increase in
UBL's market share with top corporate customers and in some cases replacing Foreign Banks.
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Presently, its portfolio includes the quality names in the country, which were initially confined to
foreign banks only.
A) UBL BUSINESS PARTNER
The UBL business Partner account allow users to Access their account from over 921 online
branches in over more than 400 cities all across Pakistan for unlimited online transactions. With
UBL Business Partner, customer’s account moves with them. Wherever they go, the Bank will
follow. It has following features:

o Instant Cash Deposits & Withdrawals

o Country Wide Instant Funds Transfer

o Issuance of Pay Order, Demand Draft & Telegraphic Transfer

o Instant Cheque Clearance for all UBL Cheques

o Speedy clearing and collection of any non UBL cheque in any Online UBL
branch

o Statement of Account Issuance / Balance Inquiry / Stop Payment of

o Rupee Deposits & Withdrawals (both cheque & cash)

o Issuance of Pay Order, Demand Draft & Telegraphic Transfer
o Locker Access
o Foreign Currency Cash Deposits & Withdrawals
o Foreign Currency Traveler’s Cheque/Demand Draft
o Utility Bills Payment
o Consumer Loans / Credit Card Payment
o Statement of Account Issuance & Balance Inquiry
o Issuance of Hamrah Rupee Traveler’s Cheques4

B) RUPEE TRANSACTIONAL ACCOUNT

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If you choose to keep a deposit in a secured savings account which also gives an attractive rate of
return, then UBL’s PLS Savings Account will serve all your financial needs. By keeping your
deposits in UBL’s PLS Savings Account you can also avail the following services:

Special features are:

o No limitation on withdrawals
o Share of profit is credited on half-yearly basis
o Profit is calculated on monthly balance
o UBL offers free accidental and permanent disability insurance to individual and
joint account holders

Access your account from more than 921 online branches in 400 cities and towns across
Pakistan. Our network is growing at an amazing pace and now you can avail services like:

o Issuance of Pay Order, Demand Draft, Money Transfer & Telegraphic Transfer
o Country Wide Instant Funds Transfer
o Country Wide Instant Deposit / Withdrawal (both Cash & Cheque)
o Issuance of Statement of Account/ Balance Inquiry
o Stop Payment of Cheque
o Speedy OBC process for cheques of other banks within & inter city
o Now customers can deposit all UBL and non UBL cheques in any online UBL
branch for clearing / collection.5

C) UBL BASIC BANKING ACCOUNT- BBA

To accommodate the banking needs of low income groups, United Bank Limited is pleased to
launch the UBL Basic Banking Account Scheme (UBL BBA) from February 25, 2006 across its
branch network all over Pakistan. This is primarily aimed toward helping the low income group
to benefit from the banking services without having the pressure to maintain specific balance
amount with the banks. Find below basic product features of the Product:

Special features are:

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o The minimum initial deposit at the time of account opening is to be Rs. 1000/-.
o Basic Banking Account will be a current account.
o There is no minimum balance penalty on UBL BBA accounts, however all
accounts having nil balance for a continuous six month period shall be closed.
o All Business Partner waivers allowed if minimum balance requirement condition
as per SOC is met by the account holder.
o Maximum of two deposit and two withdrawals (cash or clearing) per month are
allowed free of charge. However, any transaction (cash or clearing) after those
mentioned above will be charged a flat fee of Rs. 50/-, in addition to the regular
charges of services as per SOC. This charge will be system generated end of day,
once the customer exhausts his free transaction limits.
o BBA customers will be allowed unlimited free ATM withdrawals from UBL’s
own ATMs. However, withdrawals from other banks’ ATMs will be charged as
per the existing SOC (currently Rs. 15/- per transaction). Annual fees including
issuance and renewal of ATM card will be charged as per existing SOC.
o All other banking services provided will be charged as per the prevailing SOC.
o The statement of account will be issued once a year for UBL BBA customers in
June. Issuance of duplicate statement will entail a charge of Rs. 50/- as per SOC.
o Like the regular Current accounts, UBL BBA will also be Zakat Exempt accounts.

Any existing customer wanting to convert his/her checking account into Basic Banking
Account can do so by giving a written application to the Branch Manager upon which existing
account will be closed and a new UBL BBA account will be opened and a new account number
will be provided to the customer after due account opening procedures, including submission of
CNIC, if not provided earlier. The deposit in the previous account will be transferred to the
newly opened UBL BBA. Charges for closing any existing account shall be recovered as per
SOCs.6

D) UBL UNIFLEX ACCOUNT

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UBL has introduced a new checking account ideal for small investors, traders, businessmen and
customers from middle income group.They can now afford an amazing rate of return plus value
added benefits only available from the UBL UniFlex PLS Savings Account.

o Amazing rate of return

o Convenience of a cheque book
o Power of Wallet VISA ATM / Debit Card
o Online Banking Facility

T ERMS & C ONDITIONS

o All individual and joint account holders and sole proprietorships are eligible for the UBL
UniFlex Account (scheme); Corporations and partnerships are ineligible for the scheme.
o Only one UBL UniFlex account per Computerized National Identity Card (CNIC) shall
be allowed to be opened in UBL, regardless of the branch; no doubling shall be allowed
even as joint account or sole proprietor.
o The Bank shall determine from time to time the rate of interest/return/profit payable on
the account/deposit in accordance with the prevailing profit and loss sharing rules and
regulations of the State Bank of Pakistan and the policies of the Bank which are subject
to change from time to time and the account holder/depositor agrees to accept such rate
of interests/return/profit at the time such change was made.
o Interest/return/profit shall be accrued monthly, based on minimum balance touched
during the month, and disbursed six monthly directly into the UniFlex account.
o The UBL UniFlex account cannot be overdrawn.
o Accounts that are closed in the middle of a month will not be eligible for any
interest/return/profit for the broken period of that month.
o Wallet VISA card is optional; charges as per Schedule of Bank Charges (SOC). (Please
apply on the regular Account Opening Form)
o Regular checkbooks shall be provided as per Schedule of Bank Charges (SOC).
o Customer can conduct a maximum of three free of cost withdrawal transactions in a
calendar month (inclusive of all instruments). These withdrawals include but not limited
to Net banking, cash withdrawal by ATM, cash withdrawal over the counter, Inter Bank
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Funds Transfer (IBFT), clearing, collection, Online banking, Tez Raftaar, Tez Ibex,
MT/DD/TT/PO/Online (UniRemote), RTC, etc. The Bank will charge a sum of Rs. 100/-
per transaction for any withdrawal above the threshold of three debit transactions in one
calendar month. However, there is no limit for credit transactions in a month.
o All single debit incidents to an account will be considered as separate transactions except
deductions by the bank for charging service fee, Withholding Tax and Zakat deductions.
o All transactions, including the three withdrawals allowed will be charged as per the
Schedule of Bank Charges (SOC).
o The UniFlex Account Holder shall be required to maintain the minimum balance
requirement of Rs. 10,000/- during each calendar month. Service charges where the
average balance during the month is less than Rs.10,000/- shall be applied as per the
Schedule of Bank Charges (SOC).7

E) UBL UNISAVER ACCOUNT

UBL UniSaver Account is an innovative way of serving your banking needs. Be it trade,
business or personal finance, the UBL UniSaver allows you maximum flexibility, yet gives you
optimum returns.

Special Features are:

o Innovative and flexible checking account

o Attractive rates of return
o Profit is calculated on monthly average balance
o Profit payment is on six monthly basis
o Higher returns on higher balances
o Backed by the bank awarded AAA Credit Rating

F) UBL E- TRANSACTION ACCOUNT

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When it comes to electronic financial services www.ubl.com.pk is Pakistan’s favorite Internet

destination and why not!. With years of experience in innovation United Bank offers a wide
spectrum of world-class of electronic services and banking products for trailblazers like you.

o Save Money!
o Save upto Rs. 2400/- with your eTransaction Package which includes
o A branch Account with all features of a current account (including checkbook, Visa
ATM/Debit Card, etc.)
o Free Premium Internet Banking Access -- Save up to Rs. 1200/year in subscription fees
o Free Premium Mobile Banking Access -- Save up to Rs. 1200/year in subscription fees 8

G) CERTIFICATE OF DEPOSIT (COD)

Now you can earn a higher income on your surplus cash by investing it in Certificate of Deposit
which helps you earn extra income with your hard earned money, while providing absolute trust
and security.

Two Types of Profit Payment Options:

o Profit Payment at Maturity

o Monthly Profit Payment

o Stable & High Rate of Return:

o Avail one of the best and most stable rates of return by investing in CODs.
o Wide Choice in Tenor of Deposit: 3 month to 10 Years!
o You have the convenience of investing your money for the duration of your choice:
anywhere from 3 months to 10 years.

S ECURITY
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UBL understands the value of your hard earned money and continues to deliver on the promise
of safety and security. UBL's A+ credit rating by PACRA ensures a secured investment for your
money.

E ASY A VAILABLE F INANCING

You can take a loan against CODs for both your short and long term financing needs. You can
avail financing up to 90% of your deposit at a very nominal cost, allowing you to earn high
profits and still have the liquidity to meet your financial needs.

E ASY A VAILABILITY
UBL Profit CODs are available across the nation at 921 online branches in more than 400 cities
across Pakistan. Simply walk into your nearest online UBL branch and make a smart investment
through Certificate of Deposit (COD).

F REE I NSURANCE C OVERAGE

All COD customers shall also be eligible for the UBL Accidental Death and Permanent
Disability scheme.9

H) REGULAR TERM DEPOSITS RECEIPTS

If you wish to make a secured long term investment, UBL’s Term Deposit Receipt is the smart
choice, just make an investment and see your deposit grow over time. By investing in UBL Term
Deposit Receipts:

o You get an attractive rate of return.

o Your profit is paid monthly on a floating rate based on money market conditions.
o You have the flexibility to choose from a wide range of tenors.
o You can avail the Rollover or Renewed option at any time before encashment
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o You can get your TDR en-cashed at any time before maturity period.
o Avail different attractive rates depending on the tenor you choose.
o Get the pleasure of availing the best rates of return in the market.
o Avail the services and facility of 9 - 5 non stop full service banking in all UBL
branches (over 1000) across the country.
o UBL offers free accidental and permanent disability insurance to individual and
joint account holders10

I) FOREIGN CURRENCY SAVINGS

If you wish to maintain a secured foreign currency savings account then UBL is the safest and
most secure investment. By opening a UBL foreign currency savings account:

Special features are:

o Choose from different range of currencies i.e. US Dollars, British Pounds, and
Euros etc.
o There are no cash handling (Cash Deposit & Cash Withdrawals) charges from the
customers.
o Avail different attractive rates depending on the currency you choose.
o Get the pleasure of availing the best rates of return in the market.
o Unlimited withdrawals and deposits, making it easier for you to fulfill your
routine business needs.
o Avail the services and facility of 9 - 5 non stop full service banking in all foreign
currency handling branches such as foreign currency traveler cheque and demand
draft issuance against cash and foreign currency cash deposits and withdrawals
o You can withdraw funds in either foreign currency or in Pakistan Rupees,
whatever your requirement may be.
o UBL offers the widest reach across the country with an increasing number of
more than 350 foreign currency dealing branches.
o You get to take your profit home every six months.
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o Zakat exempted
o UBL offers free accidental and permanent disability insurance to individual and
joint account11

J) FOREIGN CURRENCY TERM DEPOSITS RECEIPTS

If you wish to make a secured long term foreign currency investment, UBL’s Foreign Currency
Term Deposit Receipt is a smart choice, just make an investment and see your deposit grow over
time.

o Choose from different range of currencies i.e. US Dollars, British Pounds, and Euros etc.
o Term deposits in foreign currency are offered for the following periods of maturity with
variable rates of return:
 Three Months
 Six Months
 Twelve Months
o There are no cash handling (Cash Deposit & Cash Withdrawals) charges from the
customers.
o Avail different attractive rates depending on the currency you choose.
o Get the pleasure of availing the best rates of return in the market.
o Flexible options of rollover or renew the TDR at the time of encashment.
o Avail the services and facility of 9 - 5 non stop full service banking in all foreign
currency handling branches.
o UBL offers the widest reach across the country with an increasing number of
more than 350 foreign currency dealing branches.
o You can withdraw funds in either foreign currency or in Pakistan Rupees,
whatever your requirement may be.
 Zakat exempted
 For all FCY Term Deposits, fixed rate of return on booking month's rate.
 Special Rates available from for USD 500,000 and above or equivalent.
 P a g e | 23

 UBL offers free accidental and permanent disability insurance to

individual and joint account holders12

2. ADVANCES (CARDS & LOANS)

You as an individual can gain and benefit the most through UBL Consumer Banking. In UBL
you get friendly, efficient and attentive personalized banking services - a unique banking
relationship experienced by each UBL client. You can utilize the following services
A) UBL CREDIT CARD - CHIP CREDIT CARD
Welcome to the world of UBL Credit Cards, the most exciting and vibrant credit card brand in
Pakistan. We offer you a range of innovative and exciting cards that is not only powered by the
security of chip but also enable you to personalize it any way you want. In order to get more
information on our credit cards range, click on the following cards: 13

UBL CREDIT CARD ….. MAZAY MEIN RAHO!

Welcome to the world of UBL Credit Cards. Pakistan’s 1st Chip Credit Card that guarantees you
both enjoyment and high value. It assures you global acceptability in more than 22 million
establishments worldwide in 130 countries and in more than 12, 000 outlets within Pakistan.

CHIP based credit cards have globally proven to be the most secure way of conducting credit
card transactions. This unique high tech CHIP guarantees your financial security .

G ALLERIA - P ICTURE C ARD

Your choices say a lot about your personality. Shouldn't your Credit Card!

Being different was never so easy! Now UBL Credit Card gives you the flexibility to make a
statement by letting you design your credit card in almost any manner you want. Galleria, by
UBL Cards is Pakistan’s first picture credit card that gives you freedom of choice and expression
 P a g e | 24

as you can now customize it with your favorite image and make your credit card as unique as
you are.

Express your individuality. Add a personal touch. Keep a loved one close to your heart. Or
simply make a statement.

Personalize your card with a picture of your choice on it. Choose whatever you think defines you
or represents your personality, your passions, your style or your likes. Perhaps you could put up
pictures of yourself, your loved ones or anything you please. It’s entirely up to you. For the first
time ever in Pakistan, a card that lets you express your true self.

The process is simple, the options are many, and the result is uniquely you.

For Existing UBL Credit Card Member (Basic or Supplementary)

If you are an existing UBL Credit Card Member and you need to convert your UBL Credit Card
to UBL Galleria Picture Card, simply click on the link 'UBL Credit Card Member' and design
your Galleria Picture Card.

If you are a Basic card member, download and fill the card conversion form. In case you are
uploading picture for the Supplementary Card Application, download and fill the Supplementary
Form. Drop your Conversion From or Supplementary Form in the drop box placed at UBL
Branch near you to process your Galleria Picture Card Application. You can also obtain the
application forms from UBL Branches and Customer Service Centers.

For New Galleria Picture Card Member (Basic or Supplementary)

If you are applying for UBL Galleria Picture Basic Card, contact our sales representative to fill
the Galleria Application Form. After filling out the Galleria Application Form for Basic card,
keep the App-Track No. with you which will be required for uploading the picture for Galleria
Basic Card.

If you are applying for UBL Galleria Picture Supplementary Card, visit our branch or contact our
sales representative to fill the Supplementary Card Application Form. After filling the Galleria
 P a g e | 25

Application Form for Supplementary Card, keep the Application Reference Number with you
which will be required for uploading the picture for Galleria Supplementary Card.

After submitting your Galleria application form(s), you can then upload your picture using the
link 'New Galleria Application'.

Pakistan’s First Auto Credit Card!!

Constantly worried about fuel prices and maintenance cost of your car?

The UBL Credit Cards team now brings Pakistan’s 1st Auto Credit Card - UBL PSO Auto Credit
Card. Keeping in mind the success story of our standard UBL Card, with annual fee wavier and
free liters of fuel as reward against spend, we are introducing a complete auto card solution with
PSO with high value incentives and discounts on fuel and other automobile related products.

This card is clearly aimed at offering a value-for-money proposition, with a touch of both
incentive and functional appeal as well as a clear objective of making UBL PSO Auto Credit
Card, a truly preferred card in the market.

Positioned as Pakistan’s First Auto Credit Card, it will offer 5% Free Fuel on PSO stations* and
1% on non PSO outlets. Card members can also avail various exciting discounts and benefits
given below:

o Free Accidental Insurance.

o Discount on Avis Rent-a-Car services.
o Discount on PSO lubricants (DEO and Carient).
o Discount on tracking devices from C-Track.
o Special offers at authorized 3S dealers of Honda, Suzuki and Toyota.
o Discounted rates on car insurance from TDI.
o Discount on installation of CNG Kit.
o Discounted Rent-A-Car traveling.
o Discounted car accessories.
o Discounts on tyres and stereo systems.
 P a g e | 26

With so many features and benefits under its belt, UBL PSO Auto Credit Card is, without a
doubt, a "MUST HAVE" for everyone!!

B) UBL WIZ - PAKISTAN’S FIRST PREPAID VISA DEBIT CARD

UBL Wiz is Pakistan’s first ever Prepaid VISA Debit Card that provides the convenience,
security and benefits of an ATM and Debit Card, locally and internationally.

More than just an ATM card, you can use your UBL Wiz everywhere VISA cards are accepted.
Whether you are using it online, paying for petrol, shopping or dining, you are accessing money
directly from your prepaid card, without having to visit the bank.14

C) UBL WALLET - VISA ATM DEBIT CARD

Introducing the new UBL Wallet Card, now with the International power of UBL Wallet, now
with the power and international acceptance of VISA! Your Wallet VISA ATM & Debit Card
has all the convenience and security you desire and the quality you deserve. This Wallet holds all
the cash in your bank account.

o Available to All UBL Account Holders

o UBL offers ATM and Debit Card facility to all account holders at all UBL
branches anywhere in Pakistan, regardless of whether their branch is online or
offline.

o Nine Supplementary Cards

o UBL Wallet VISA also gives you the facility of having up to 9 supplementary
cards issued against one primary card. All supplementary cardholders will be able
to conduct ATM/Debit transactions within the limits of the primary card account.

o 24 x 7 Toll-Free Contact Center

 P a g e | 27

o UBL's dedicated staff is at your service 24 hours a day, 7 days a week. You can
call our contact center at 111-825-888 (UAN), or you can simply pick up the
telephone placed next to all UBL ATMs and be instantly connected to our
customer service representative via a hotline facility.

UBL W ALLET Y OUR ATM C ARD

UBL already has its own network of 409 ATMs in 86 cities, which continues to expand by the
day. Moreover, UBL Wallet is now part of the 1 Link and VISA networks. These allow you to
use your UBL Wallet VISA across Pakistan at more than 925 ATMs displaying the 1 Link logos
and at more than 1 Million ATMs in 150 countries. It is also acceptable on the MNET network
of ATMs in Pakistan. Your Wallet VISA Card will also be acceptable on all local VISA certified
machines displaying the VISA Plus sign.

UBL W ALLET Y OUR D EBIT C ARD

With UBL Wallet VISA as your debit card, you can shop all you want, eat all you can or fill up
your car tank without carrying any cash. Simply use your UBL Wallet VISA for direct debit
from your bank account, along with the convenience of using signature based verification instead
of a PIN (Personal Identification Number).

The debit card facility is being offered in association with the Orix and VISA networks, which
means that you can use your UBL Wallet VISA to conduct a debit transaction at any outlet in
Pakistan that displays the ORIX or VISA logos.

The Orix network offers connectivity at more than 5,000 outlets across the country, whereas your
UBL Wallet VISA card is also acceptable at 22 million VISA merchant locations, local and
international.

Funds Transfer:

UBL Wallet VISA allows three kinds of instant funds transfer through UBL ATMs from your
UBL account:

a. Into any of your UBL account.

 P a g e | 28

b. Into any other UBL account.

c. Into any other participating 1 Link bank (through the new UBL
Inter Bank Funds Transfer facility)

On confirmation, the amount from the cardholder account is instantly transferred to the
beneficiary account.

o UBL ATMs Accept All VISA Cards

o In addition to the launch of the Internationally VISA powered UBL Wallet card,
we are also proud to announce that our 200 plus UBL ATMs are now VISA
certified and are geared up to accept all International VISA Debit and Credit
cards.

D) UBL ADDRESS - HOME LOAN FACILITY

Owning a house of your very own is a cherished dream. A lot of planning and hard work is
involved in making this dream come true. That is why, at UBL we aim to make your decision
easier, by offering you the right ingredients that can help you realize your dream with absolute
convenience.

UBL Address empowers you to become the proud owner of a home by offering a variety of
product and pricing options that are flexible yet affordable. So choose the best product option
and pricing to suit your needs. All product options are amortized and range over a tenor of 3 - 20
years.

B UYING A H OME
Why rent when you can buy? Buying a home of your choice has never been so easy. With a
maximum financing limit of 70% you can easily buy a house or apartment that best fits your
requirements. So go ahead and start the search for your dream home because with easy and
affordable installments you need not think of renting a house when you’ve got UBL Address.

B UILDING A H OME
 P a g e | 29

Have you ever settled for anything less than perfect? There’s nothing like building your perfect
home, your way. With every detail in place like the elegant French windows or the perfectly
manicured lush green lawn, just the way you’ve always imagined. By chalking out well planned
fund tranches at each phase of the building process, UBL Address brings you your dream house
one step closer.

L AND P LUS C ONSTRUCTION

What do you do with an empty piece of land? Construct your dream house with all the aesthetic
details you’ve ever wished for. UBL Address helps you through every stage of construction by
providing you with well planned out fund tranches so that you can better manage your
construction.

F LOATING R ATE
In this option, you get a fixed rate for a period of 12 months, which gets re-priced annually.
(Upward or downward, only to the extent of Kibor).

Eligibility Criteria

o Minimum monthly income: Rs.50,000

o Age: 23 to 65 years
o Resident Pakistani
o Self-employed businessman/professional or salaried individual
o Minimum loan size: Rs. 500,000

Documentation Requirements

o Copy Of NIC
o Two recent Photographs each of primary as well as co-borrowers
o Signed Lou (Letter of Understanding), which states the applicable rate at the time
of booking of loan.
 P a g e | 30

o General Income Documents for Salaried and SEB/SEP are given below. However,
your exact Documentation Requirement as per your specific Segment &
Profession will be communicated to you by our respective ROs.
o Employment Certificate confirming last 12 months work experience
o Tax Document for the past 24 months
o Current Salary Slip
o Bank Statement for the last 12 months
o Last 3 years Tax Assessment Order or Registered Partnership Deed
o Bank Statement for the last 12 months
o Salary Slip/Salary Certificate
o Other Documents are required to substantiate the length of business

M ARKUP R ATES
Both Floating and Adjustable Rate Options are available. The Floating Rate Option is subject to
annual revision from the time of loan booking. Any change in the mark up rate may be either
upward or downward revision (if required) after every twelve (12) months from the date of the
booking of the loan(upward or downward only to the extent of Kibor).

Markup rates are calculated on the basis of the prevailing one year Karachi Inter-Bank Offered
Rate (KIBOR*) which is taken as the base rate. A margin that varies from one pricing option to
another is charged over and above the base rate, the details of which are as follows:

o Salaried KIBOR + 3.5% = Applicable Markup Rate

o SEB/SEP KIBOR + 4.5% = Applicable Markup Rate

The applicable markup rate will be the rate prevailing at the month of booking. This will be
communicated to the applicant through the Repayment Schedule -

To know more about the applicable rates for various pricing options, please call UBL Phone
Banking at 111-825-888.
 P a g e | 31

* KIBOR is defined as the average rate “ask side” for one year tenure as published on Reuters
Page KIBOR or as published by Financial Market Association of Pakistan in case Reuters Page
in unavailable.1516

E) UBL BUSINESSLINE - BUSINESS FINANCING LOAN

UBL business line is a complete solution to all your Business Financing needs. With UBL
Business Financing facility, you can now take your business to greater and newer heights, and
achieve the level of success that you truly deserve.UBL business line is a running Finance
facility that not only provides funds for growth but also enables you to capitalize on profitable
opportunities.

With UBL Business line, now you will surely say: “Ab Hui … Kamiyaabi Meri Manzill”.

FEATURES:
Utilize up to Rs.10 million:

Now, UBL Business line credit line is here to solve all your cash flow problems. You can utilize
up to Rs.10 million with the help of which you can now focus on your business expansion and
growth.

LTV as high as 70%:

UBL Business line offers you the facility of availing a financing of up to 70 % of your property
value. Now that you can avail a higher amount against your assets, you can plan your growth and
expansion exactly the way you want to. In addition financing is offered to customers that are
already availing a similar facility from any other bank.

M ARK UP ON UTILIZED AMOUNT ONLY :

With UBL Business line, now you no more need to pay for the entire credit line that you own.
Business line gives you the facility to pay mark up only on the amount that you utilize.

F ASTER P ROCESSING :
 P a g e | 32

After completion of your documentation requirements, UBL Business line promises you a very
smooth and fast processing, hence saving you time and frustration.

W IDE A CCESSIBILITY :
UBL Business line’s availability in major cities like Karachi, Lahore, Faisalabad, Islamabad &
Rawalpindi, is complimented by UBL s countrywide branch network enabling our customer to
access his account, and deposit or withdraw cash, no matter where he stands within the country.

C OMPETITIVE R ATES :
At UBL, you come first, which is exactly the reason why we offer our customer such competitive
rates that would facilitate him in leveraging his skills to the maximum and in bringing about the
success that he deserves.

ELIGIBILITY CRITERION:
If you fall in the following criteria, then UBL Business line is just the right choice for you:

o Minimum monthly income: Rs. 50,000

o Age: 25 – 55
o Resident: Pakistani.
o Self Employed Professional / Self Employed Businessman.17

F) UBL CASHLINE - RUNNING FINANCE FACILITY

UBL Cashline is a flexible loan that provides you cash up to Rs.500,000 without any security
requirements. It empowers you to take control of your finances. UBL Cashline is aimed to make
your life easier…ZINADGEE ASAAN. Whether you are a salaried individual or a businessman,
UBL Cashline takes care of your cash requirements.
 P a g e | 33

Cash line offers you:

F LEXIBILITY
 No fixed monthly installment.
 Principal repayment at your convenience.
 No prepayment penalty.
 Markup only on utilized amount.
 Worry free payment of bills, shopping, child’s education, short-term
business needs or just about any thing you can think of!

E MPOWERMENT
 For the first time in Pakistan, you can now control your markup. Enjoy
lower markup on higher utilization of funds.
 Markup calculated on daily outstanding balance.
 Continuous line of credit.

C ONVENIENCE
 Instant access to cash through the entire UBL network. You will be given
a cheque book and an ATM/Debit Visa Card which you can use at
900,000 ATMs and 22 million outlets worldwide.
 Unsecured /clean lending, no collateral required.
 UBL Netbanking
 All UBL Cashline customers are automatically registered on UBL
netbanking and can avail numerous netbanking features such as:
 Bill Payment
 Funds transfer
 Account update
 Statement of accounts18

G) UBL DRIVE - AUTO LOAN

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UBL Drive is a unique auto financing product which offers you features, options and flexibility
unmatched by any other bank, because at UBL, You come first.

N EW C AR F INANCING
UBL Drive allows you to drive away in your own car by making a down payment of just 15%
and to top that with low monthly installments.

U SED C AR F INANCING
With UBL Drive you can buy your favorite used car (up to 5 years old) at the most affordable
rates.

C AR R EPLACEMENT P LAN
Drive’s Car Replacement Plan is the slogan name for a premier auto financing product.
Customers who intend to avail loan facility from UBL Drive under this variant can readily have
their existing cars replaced after a year of financing.

P RODUCT F EATURES

 Free Tracking Device

 Option will be provided to the customers on affordable rates. this will be done in
collaboration with the insurance companies on our panel.
 Free Life Insurance Coverage
 Includes accidental death coverage and medical reimbursement to the customers in case
of any unforeseen circumstances.
 Zero Pre-Payment Penalty
 No penalty will be charged from the customer if the loan is been paid off after a year.
 A unique concept whereby which payment breaks will be given to the customers on
occasions such as Eid etc. Payment Holidays will be given once a year to the customers.
 Whereby which the customer will be provided the flexibility to change the loan tenor, opt
for partial payment of the outstanding principal amount.19
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H) UBL AGRICULTURAL &NBSPLOAN

AGRICULTURAL PRODUCTS
 Farm Loans
 Production Loan

Financing is available for Major and Minor crops across Pakistan. Main purpose of financing is
to facilitate farmers to purchase Agri Inputs such as Seeds, Fertilizers, Pesticides, Sprayers, hired
labor etc.

NIACF (R EVOLVING C REDIT S CHEME )

 Loan Tenure 3 years
 Documentation once for 3 years.
 Cleanup once a year
 Option for the farmer to use limit as per requirement
 Markup is charged on amount used or withdrawn
 Minimum Amount PKR 30,000
 Maximum Amount as per requirement of the farmer

NIADF (D EMAND F INANCE P RODUCTION )

 Loan Tenure 3 months to 1 year
 18 months for Sugar cane only
 Lump sum disbursement of the limit for a specified period.
 Repayment of loan in bullet payment on maturity (Principal and markup).
 Minimum Amount PKR 30,000
 Maximum Amount as per requirement of Farmer
 Development Loan
 Land Development, Equipments and Machinery
 Financing for Land Improvement, Water course improvement, Tube wells, Lift pumps,
Deep turbine pumps, Cotton pickers, Godown, Cold Storage, Harvester, Thresher, etc

T RACTOR & V EHICLE F INANCE

 P a g e | 36

To purchase Tractors, Delivery Vans, Mini Trucks, Motor Cycle and other vehicles used for
marketing Agri Products

N ON F ARM L OANS

L IVESTOCK F INANCING
Dairy Farming, Meat Farming, Fattening of Animals, Rearing of Animals, Construction of
Sheds, Milk storage tanks, acquire and establish modern and efficient livestock facilities.

P OULTRY F INANCING
Poultry Farm structure and equipments, Hatchery farm structure and equipments, Feed Mills,
Purchase of Chicks, Feed, Medicines, Storage tanks, Cold storage, Construction of shed, etc.

F ISHERIES F INANCING
Fish seed, Fish feed, Manuring, Construction of pond, Curing and Dying by fishermen, etc.20

I) UBL SMALL BUSINESS - SME LOAN

Under the Small Business Scheme, UBL is providing loans on easy terms to those who wish to
set up their own small-scale business. This scheme is aimed at spreading prosperity in the
country by reducing unemployment.

As more and more people start their own industrial units, the country will move steadily towards
economic self-reliance.21

3. REMITTANCES
A) DEMAND DRAFTS
Drafts drawn by one branch on another branch or on the Head Office of same bank or vice versa,
are not cheques or bills, as these have no distinct drawer and drawee. Section 85-A reads:
 P a g e | 37

“ Where any draft, that is, an order to pay money, drawn by one office of bank upon another
office of the same bank for a sum of money payable to order on demand, purports to be issued by
or on behalf of the payee, the bank is discharged by payment in due course”.

Banker’s drafts payable to order on demand are within the protection of Sections 10 and 131-A
of the Negotiable Instruments Act. However, if a demand draft drawn on a bank by its own
branch bears a forged endorsement, the person in possession of it cannot compel that bank to pay
it. As far as possible the banker’s draft should be crossed and it should never be drawn payable
to bearer.

When a person requires a draft he should be asked to complete the prescribed application form in
which he should state the amount of the draft, the name of the payee, and the place of payment.
This application form should be signed by the purchaser or by those persons who have been duly
authorized to act on his behalf. When a customer requests his banker to provide him with a
banker’s draft, the amount of which is to be debited to his account, he should enclose with his
written request a cheque covering the amount of the required draft and other charges etc. payable
to banker.22

The United Bank Limited provides demand drafts at very reasonable rates with safety, speedy
and reliable way to transfer money. Any person whether an account holder of the bank or not,
can purchase a Demand Draft form a bank.

B) TRAVELERS CHEQUES
They are generally issued for the convenience of person travelling abroad, but some Pakistani
banks issue them in Pakistan currency also for use within the country as well. Before issuing, the
bankers receive an amount equal to the face value of the cheques, and also charge a small
commission. The travelers’ cheques are for fixed amount and are treated as Order cheques
payable only to the purchaser whose specimen signature appears on each traveler’s cheque itself.
Foreign currency travelers cheques are issued and encashed in accordance with the provisions of
the Exchange Control Regulation Act, 1947. While making payment, the paying banker must
insist that the holder signs in his presence.23
 P a g e | 38

The United Bank Limited provides their services for traveler’s cheque at very reasonable and
competitive rates.

C) LETTER OF CREDIT
Letters of credit are very useful instruments in facilitating commercial relations between
businessmen at various places. Letter of credit state the limit of the credit and the time during
which it is held at the disposal of the grantee, but they are neither negotiable nor transferable.
Letter of credit may be revocable. There are many kinds of letter of credit such as Revolving
credit, Back to Back credit, Claused credit etc.24UBL is committed to offering its business
customers the widest range of options in the area of money transfer.  If you are a commercial
enterprise then our Letter of Credit service is just what you are looking for. With competitive
rates, security, and ease of transaction, UBL Letters of Credit are the best way to do your
business transactions.

D) FOREIGN REMITTANCES
To facilitate its customers in the area of Home Remittances, United Bank Limited has taken a
number of measures to:

Increase home remittances through the banking system.

Meet the SBP directives/instructions for timely and prompt delivery of remittances to the
beneficiaries.

The new features of UBL foreign remittances include:

The existing system of home remittances has been revised/significantly improved and
well-trained field functionaries are posted to provide efficient and reliable home
remittance services to nonresident Pakistanis.
Zero Tariffs: UBL is providing home remittance services without any charges.
Strict monitoring of the system is done to ensure the highest possible security.
Special courier services are hired for expeditious delivery of home remittances to the
beneficiaries.
 P a g e | 39

E) SWIFT SYSTEM
The SWIFT system (Society for Worldwide Inter bank Financial Telecommunication) has been
introduced for speedy services in the area of home remittances. The system has built-in features
of computerized test keys, which eliminates the manual application of tests that often cause delay
in the payment of home remittances. Using the UBL network of branches, we can safely and
speedily transfer money for our business and personal needs.

F) MAIL TRANSFER
A Mail Transfer is a form of remittance in which the amount remitted by a customer or a non-
customer is directly credited to the account of the beneficiary with another branch.Move your
money safely and quickly using UBL Mail Transfer service.  And UBL also offer the most
competitive rates in the market. They charges Rs 50/- exchange rate and RS 75/- postage charges
on issuing mail transfer.When the money is not required immediately, the remittances can also
be made by mail transfer (MT). Here the selling office of the bank sends instructions in writing
by mail to the paying bank for the payment of a specified amount of money. Debiting to the
buyer’s account at the selling office and crediting to the recipient’s account at the paying bank
make the payment under this transfer. UBL taxes mail charges from the applicant where no
excise duty is charged. Postage charges on mail transfer are actual minimum Rs. 40/- if sent by
registered post locally Rs.40/- if sent by registered post inland on party’s request.

G) TELEGRAPHIC TRANSFER
Telegraphic Transfer is a form of remittance, which is advised by telegram, telex or fax
machines. The fundamental principles of such transfer are otherwise identical with the Mail
Transfer.It is the message, which is sent from one branch to another on the order of payer to
payee through wire. It is one of the quickest means to transfer fund through the use of
telex/fax/internet or cable. Payment to the beneficiary is affected directly by the drawee office
upon identification or through credit into beneficiary’s bank account. As such remitting office is
not required to issue any instrument payment to the remitter for delivery to the beneficiary.
 P a g e | 40

H) PAY ORDER
NBP provides another reason to transfer your money using our facilities.  UBL pay orders are a
secure and easy way to move your money from one place to another.  And, as usual, UBL
charges for this service are extremely competitive. The charges of UBL are very low all over the
Pakistan. It charges Rs 50/- for UBL account holders on issuing one payment order,and charges
Rs 100/- for NBP non-account holders on issuing one payment order. It charges Rs 25/- for
students on payment of fees of educational institutions. If some one want a duplicate of payment
order they charges Rs 100/- for UBL account holders and Rs 150/- for non account holders.

4. MISCELLANEOUS
A) UBL TEZRAFTAAR
UBL offers the most efficient and free remittance service to beneficiaries in Pakistan. With our
large network of branches, we are poised to offer you service almost at your door step.

UBL remittance service, TezRaftaar offers all overseas Pakistanis the fastest and the most
convenient delivery of their money to their beneficiaries in Pakistan. Best of all, TezRaftaar is
completely cost free and is available at all UBL Overseas branch network in the Middle East,
UK and US. This facility is also available at UBL’s correspondents (Banks/ Money Transfer
Cos) in Australia, Canada, Denmark, UK, USA, UAE, Saudi Arabia, Kuwait, Bahrain, Oman,
Qatar, Malaysia and Europe as per list available at Remitter Locator. 25

B) UBL TEZRAFTAAR CASH

TezRaftaar Cash is a new hassle-free home remittance delivery service, primarily to facilitate
Pakistanis living abroad in sending money to their loved ones in minutes in Pakistan.

Money can now be INSTANTLY received through any branch of UBL in Pakistan. The remitter
can send the money either from any overseas UBL branch or through authorized Correspondent
Banks, Money Transfer Companies or Exchange Companies. The beneficiary, in turn, can obtain
cash up to Rs.500, 000/- over the counter.

Countries where the service is already available are Australia, Canada, Denmark, UK, USA,
UAE, Saudi Arabia, Kuwait, Bahrain, Oman, Qatar and Malaysia and Europe as per Locator list.
 P a g e | 41

The service is fast, dependable and hassle-free and the beneficiary does not need to have an
account at UBL. All that is required is a Remittance Reference Number and the beneficiary’s
original CNIC.

UBL TezRaftaar Cash Salient Features:

 Receiver’s account in UBL is not required

 Instant cash over the counter payment of up to Rs. 500,000/- can be made to the
beneficiary at any UBL online branch
 Fast, dependable and hassle-free funds transfer
 SMS alert for beneficiary 26

C) HAMRAH
UBL has always been at the forefront in identifying and meeting the financial needs of its
valued customers. UBL was the pioneer in introducing Rupee Travellers Cheque facility in
Pakistan, as early as 1971. In continuation of the same tradition, UBL in the shape of "Hamrah"
Rupee Travellers Cheque enhances this facility for the convenience of its valued customers by
offering denominations up to Rs. 10,000

UBL "Hamrah" has been designed keeping in mind, both convenience and security - be it
business, property, trade or personal needs. "Hamrah" Rupee Traveller Cheques are the ideal and
safest way of carrying cash when travelling anywhere in Pakistan.Hamrah RTC's are now
accepted at more than 2000 places such as hotels, shops, real estate agents, jewelers, car dealers,
etc. and of course at all our UBL branches.

S ALIENT F EATURES

o Absolutely FREE - No Bank Commission, No Excise Duty:

o Whatever the value of "Hamrah" purchased, no Bank Commission or Excise Duty
will be charged
o Denominations:
o Available in denominations of Rs. 10,000 and Rs. 5,000 27
 P a g e | 42

D) UBL NET BANKING

UBL net banking is an Internet Banking portal offering a simple, convenient and secure method
of accessing bank accounts on the Internet. It's never been so easy to access and manage your
finances in a secure, real-time, online environment; Anywhere, Anytime.

Using UBL net banking, the customers have access to their bank accounts 24 hours a day, 7 days
a week and can keep a close eye on their account balances, print account statements, pay bills,
transfer funds, track purchases and schedule their recurring payments at the touch of a button and
much more.28

E) UBL E-STATEMENT
UBL is pleased to announce the launch of the UBL e-statement facility which makes it easier for
you to get your statement of accounts and automated transactional debit/ credit alerts right into
your inbox. Available for all Rupee and Foreign Currency Account holders, you now do not have
to wait for six months to receive a paper based statement of your account any more. All you need
to do is tell us the frequency of statements you require and we will ensure that it reaches your
inbox

Absolutely free of cost: you don’t need to pay any additional cost in order to get benefit from this
facility. UBL believes in providing value-added service to customers and all you need to get
started is your email address! Accessible when you need it: UBL e-statement provides you a
highly convenient facility to receive your statement anytime and anywhere in the world!29
 P a g e | 43

ORGANIZATIONAL STRUCTURE OF UNITED BANK LIMITED

 P a g e | 44

ORGANIZATIONAL (MANAGEMENT) LEVELS AT UBL

Successful and profitable banking management deepens upon two principal factors:

a) The manner in which the function of banking, that is, the acquiring of deposits, the
investing or converting such deposits into earning assets, and the servicing of each
deposits, are performed.

b) The degree to which officers and employees contribute their talents to the progress and
welfare of the bank in discharging duties and responsibilities.

Management is a distinct process consisting of activities of planning, organizing, actuating and

controlling performed to determine and accomplish stated objectives with the use of human
being and other resources.30The management has two types i.e..,

a) Centralized (Centralized Management tends to concentrate decision making at the top of

the organization)
 P a g e | 45

b) Decentralized (Decentralized disperses decision making and authority throughout and

further down the organizational hierarchy)

National Bank of Pakistan has a centralized type of management because all the decisions are
taken by the top management. The National Bank of Pakistan has four types of management
levels which are as fallows:

TOP MANAGERS
Top managers are responsible for making organization-wide decisions and establishing the plans
and goals that affect the entire organization. These individuals typically have titles such as
executive vice president, president, managing director, chief operating officer, chief executive
officer or chairman of the board. The NBP have its top management in their head office at
Karachi. They are responsible for making the plans and establishing goals the run their business
smoothly all over Pakistan & around the globe. Among seven member of group Chief Executive
is called the president. The bank has directors for superintendence and direction of its business.
The Government appoints six directors as members and one president. These members are also
responsible for making the policy of the bank.

MIDDLE MANAGERS
Middle managers include all levels of management between the first line level and the top level
of the organization. These managers manage the work of first line managers and may have titles
such as department head, project leader, plant manager or division manager.31 NBP divided his
management into various regions such as Rawalpindi region, Gujranwala region etc. In NBP,
regional management falls under this category. They are responsible for the planning,
organizing, leading and controlling of the resources and staff of the whole region.

FIRST LINE MANAGERS OR LOWER LEVEL MANAGEMENT

First level managers are the lowest level of management and manage the work of non-managerial
individuals who are involved with the production or creation of the organizations products. The
 P a g e | 46

branch managers of NBP fall under this category. These managers are responsible for planning,
organizing, leading and controlling the staff and all affairs of the branch.

NON MANAGERIAL EMPLOYEES

Non managerial employees are not concerned with any decision making. They are normally
specialized in their work. The nature of their job is repetitive & clerical as they do same work
again & again. The non managerial employees of NBP consist of OG-II, OG III and clerical
staff.

HIERARCHY OF UNITED BANK LIMITED

The Hierarchy (An arrangement of objects, people, elements, values, grades, orders, classes etc.,
any system of persons or things ranked one above another) of National Bank of Pakistan is
shown as Annexed III at the end of this report. The hierarchy may include:

Categorization of a group of people according to ability or status.

A body of clergy organized into successive ranks or grades with each level subordinate to
the one above.
A series in which each element is graded or ranked
A body of officials disposed organically in ranks and orders each subordinate to the one
above it; a body of ecclesiastical rulers.
An organization with few things, or one thing, at the top and with several things below
each other thing.

The President of National Bank of Pakistan is ranked Top at the hierarchy. The other six
directors of National Bank of Pakistan are ranked second in the hierarchy. The Provisional,
Regional & Zonal chiefs are ranked 3rd, 4th& 5th respectively. The vice President & assistant vice
 P a g e | 47

Presidents of National Bank of Pakistan are ranked 6 th& 7th respectively. The Officers Grade I, II
& III are ranked 8th at the hierarchy of National Bank of Pakistan. The lower level of National
Bank of Pakistan is consist of Clerical & non- clerical staff.

ORGANIZATION STRUCTURE OF THE BRANCH

A well-developed and properly coordinate structure is an important requirement for the success
of any organization. It provides the basic framework within which functions and procedures are
performed. Any organization needs a structure, which provides a framework for successful
operations. The operation of an organization involves a number of activities, which are related to
decision making, and communication of these decisions. These activities must be well
coordinated so that the goals of the organization are achieved successfully.

The organization chart & Organogram of National Bank of Pakistan Rawat Branch is shown on
Annexed IV & Annexed V at the end of this report. This chart defines the line of authority in the
branch and its departments. It is a sort of visual presentation of the organizational structure. It
specifies the duties and responsibilities of the personnel or staff of the branch.The purpose of an
organizational structure is to help in creating an environment for human performance. Although
the structure must define the task to be done, the rules so established must also be designed in the
light of abilities and motivation of the human recourse available. By analyzing the organization
structure of the branch following elements can be found in the structure.
 P a g e | 48

A) CENTRALIZED DECISION MAKING

The Branch Manager of National Bank of Pakistan is responsible for all the affairs of the Bank.
All the decisions relating to Branch are made by him and the subordinates have to obey these
decisions. All the employees of the Bank are report directly to the Branch Manager. The branch
has two operation Managers. Operation Manager I controls Clearing house & Remittance
Department and Operation Manager II controls Deposits, Advance & Branch accounts
department. Both of them are report directly to the Manager regarding affairs of their
departments. The Chief Accountant controls Accounts department & is report directly to branch
Manager. The branch also has two cashiers responsible for cash & Pension disbursement
department reports directly to branch Manger. The BBO (Branch Back Office System) Operator
controls computer department of the branch and is report directly to Operation Manager I and
Branch Manager.

B) DOWNWARD COMMUNICATION

Communication is the process by which information is exchanged and understood by two or

more people, usually with the interest to motivate or influence the behavior of others in the
organization. Downward communication is the message and information sent from top
management to subordinates in a downward direction. The same pattern is followed at National
Bank of Pakistan Rawat branch, the Manager of the branch sent orders, information & messages
to following subordinates

Operation Manager I
Operation Manager II
BBO ( Branch Back Office System) Operator
Chief Accountant
Cashier I
Cashier II
Clerk I
 P a g e | 49

Clerk II
Non Clerical Staff

C) CHAIN OF COMMAND

The chain of command is an unbroken line of authority that links all persons in an organization
and shows who reports to whom. By analyzing the organizational structure of the National Bank
of Pakistan Rawat branch it can be found that there is a scalar principle followed with in the
branch because each and every employee of the branch knows to whom they can report. The
authority and responsibility for different tasks and duties are different, as well as every one
knows the successive levels of management all the way to the top.

D) AUTHORITY AND RESPONSIBILITY

The chain of command illustrates the authority structure of National Bank of Pakistan Rawat
Branch. Authority is the formal and legitimate right of the manger to make decisions, issues
orders and allocates resources to achieve organizational desired outcomes. By analyzing the
chain of command of NBP, one can come to the conclusion that, as there is scalar pattern
followed at the organizational setup of NBP, therefore it is implied that everyone in his position
knows that what is one’s authority and what is the responsibility and the authority it allocated.

E) DELEGATION

Delegation is the process, which managers use to transfer the authority and responsibility to
position below in the hierarchy. Most organizations today encourage managers to delegate
authority to the lowest possible level to provide maximum flexibility to meet customer needs and
adapts to the environment. At National Bank of Pakistan Rawat branch Operation Managers have
some authority & responsibility relating to affairs of the Branch.
 P a g e | 50

DEPARTMENTS OF THE BRANCH

Banking procedures are divided between various departments. Different departments do their
jobs in occurrence with the bank policies. In National Bank of Pakistan each branch is divided
into various departments depending on their size and volume of business. Head of department
manages each department & officials of the branch follow procedures. The departments working
within National Bank of Pakistan Rawat branch are as under:
1. Clearing House Department
2. Remittance Department
3. Computer Department
4. Deposits Department
5. Advances Department
6. Account Opening Department
7. Accounts Department
8. Cash Department
9. Pension Disbursement Department

1. CLEARING HOUSE DEPARTMENT

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As part of their daily business activity, banks receive cheques and other financial instruments
from their customers drawn on other banks, to be collected and credited to their accounts.
Similarly, banks receive cheques/instruments from other banks, deposited by customers of the
banks drawn on the customers of the drawee banks. Therefore, the banks act as Collecting Banks
when they send cheques/instruments for collection and as paying Banks, when they receive
cheques/instruments for collection from other banks. Since each bank receive and sends
cheques/instruments for collection to and from an number of banks, the process of settlement
would clearly be very cumbersome and time consuming if every cheques/instrument had to be
sent by the collection bank to each of the drawee banks or branch upon which different collection
items are drawn and to individually pay the proceeds to each of the bank sending
cheques/instrument in for collection. Therefore, the banks have evolved what is called the
Bankers Clearing arrangement.

The Clearing System enables cheques to be paid or cleared centrally and settlement made for
receivables and payables between the banks. The SBP co-ordinates clearing activity through its
offices, called the Clearing Houses, set up in big cities and towns. Where SBP does not maintain
its own office, some other bank, usually National Bank of Pakistan (NBP) performs this
function. But the clearing house facility is available only for cheques/instruments drawn on
banks situated within the same city/clearing house area.

W ORKING OF THE C LEARING P ROCESS

Under the clearing arrangements, the State Bank of Pakistan (SBP) offers a Clearing House or a
centralized exchange facility, which works on the following general lines:

All the banks operating in a city who are members of the Clearing House maintain an
account with the SBP’s Clearing House.
Every day representatives of all the banks in every city meet the Clearing House, first
meeting in the morning, at an appointed time, for the purpose of depositing their own
customers , cheques/instruments to be collected from other banks and receiving
cheques/instrument drawn on their account holders from the others banks.
 P a g e | 52

At the Clearing House accounts of all the banks are debited by the total amount of
cheques/instruments drawn on their customer’s accounts and credited with the amount of
their customer’s cheques/instruments drawn on other banks, as per the list of cheques
submitted by each bank.
The cheques/instruments received, also called Inward Clearing, and are taking back by
each bank to its bank/branch. The amounts of each cheques/instrument is debited or
recovered from each drawee customers’ account and credited to the Clearing House
account. Similarly, against the amount credited by the Clearing House as Outward
Clearing, the appropriate customers’ accounts are credited and clearing House account is
debited.
Any cheques/instruments received by a bank that cannot be paid, due to insufficient
balance in its customer’s account or for any other reason, are returned back to the
Clearing House and a credit is claimed and obtained there against.

R ULES & R EGULATIONS OF C LEARING H OUSE

Timing:(Monday to Saturday)
i. 1st Clearing at 10:00 a.m.

ii. 2nd Clearing at 2.30 p.m.

Each bank will send competent representative to exchange the cheques.

Each bank is required to insure that all cheques and other negotiable instruments are
properly stamped and suitably discharged
An objection memo must accompany each and every cheque when return unpaid duly
initialed.
Each bank is required to maintain sufficient funds in the principal account with SBP to
meet the payment obligations.
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The State Bank of Pakistan debit the account of each member of the clearinghouse with
the proportionate working expenses incurred on the operation of clearing house. These
expenses are very nominal.

O UTWARD C LEARING AT THE B RANCH

The following points are to be taken into consideration while an instrument is accepted at the
counter to be presented in outward clearing:

The name of the branch appears on its face where it is drawn o.

It should not stale or post dated or without date.
Amount in words and figures does not differ.
Signature of the drawer appears on the face of the instrument.
Instrument is not mutilated.
There should be no material alteration, if so, it should be properly authenticated.
If order instrument suitably indorsed and the last endorsee’s account being credited.
Endorsement is in accordance with the crossing if any.
The amount of the instrument is same as mentioned on the paying-in-slip and
counterfoil.
The title of the account on the paying-in-slip is that of payee or endorsee (with the
exception of bearer cheque).
If an instrument received other than National Bank of Pakistan then special crossing
stamp is affixed across the face of the instrument. Clearing stamp is affixed on the
face of the instruments, paying-in-slip and counterfoil (The stamp is affixed in such a
manner that half appears on counterfoil and paying-in-slip). The instrument is
suitably discharged, where a bearer cheque does not require any discharge and also an
instrument in favor a bank not need be discharged.

The instrument along with pay-in-slip is retained while the counterfoil is given to the customer
duly signed. Then the following steps are to be taken:

1. The particulars of the instrument and the pay-in-slip or credit voucher are entered in the
outward clearing register.
 P a g e | 54

2. Serial no is given to each voucher.

3. The register is balanced; the credit vouchers are balanced from the instruments and are
released to the respective departments against acknowledgement in the register.

4. The instruments are arranged bank wise.

5. The schedules are prepared in triplicate, two copies which are attached with the relevant
instrument and the third is kept as office copy.

6. The house page is prepared from schedules in triplicate.

7. The schedules and house pages are signed by the house in charge with branch stamp.

8. The grand total of the house page is taken and agreed with that of the outward clearing
register.

9. The instrument along with duplicate schedule and house page are sent to the main office.

10. The entry of the instrument returned unpaid is made in Cheques returned Register. If the
instrument is not to be presented again in clearing then a covering memo is prepared. The
covering memo along with returned instrument and objection memo is sent to the
customer who sent the same to his account.

I NWARD C LEARING OF THE B RANCH

1. The particulars of the instruments are compared with the list.

2. The instruments are detached and sort out department wise.

3. The entry is made in the inward clearing register (serial no. Instrument no. Account No)

4. The instruments are sent top the respective departments

5. The instruments are scrutinized in each respect before honoring the same.

S PECIAL C LEARING
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In addition to the normal clearing function at Clearing house it is mutually agreed to hold an
extra clearing at the clearing house on the particular day and time which is known as “special
clearing” it is arranged due to the rush of work arising out of say, more Holidays declared by the
Central Govt. at a time, but normally special clearing is held on last working day of half yearly
and yearly closing i.e. 30th June and 31st Dec. every year.

2. REMITTANCE DEPARTMENT
The Remittance department deals with the transfer of money from one place to another. Funds
transfer facility or remittance of funds is on of the key functions of the banks all over the world.
Remittances through banking channels save time, costs less and eliminate the risks involved in
physical transportation of money from one place to another. National Bank of Pakistan transfers
money in the following ways.

Pay Order
Demand Draft
Mail Transfer
Telegraphic Transfer
Pay Slip
Call Deposit Receipt
Letter of Credit
Traveler’s Cheque

The Job responsibilities & requirements of remittance department include:

Responsible for money transfers, issuance of pay-orders & drafts, collection items,
maintenance of cheque books & ATM cards and all other counter specific products and
services
Ensure highest level of customer service in a professional and competent manner
Must ensure that the activities are carried out strictly in accordance with the laid down
procedures/processes, and SBP/Compliance guidelines
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Responsible for Cash, Clearing, Inland remittances including Demand Drafts and Pay
Orders
Ensure high standards of customer services within the assigned turn around time
Ensure compliance with SBP's regulations and internal controls
handling cash, clearing, local remittances, and other related activities at branch level

P ARTIES INVOLVED IN R EMITTANCES

There are four parties involved in Remittance, which are

Remitter
Remittee
Issuing Bank
paying Bank

R EMITTER
One who initiates, or requests for a remittance. The remitter comes to the issuing or originating
branch, asks for a remittance to be made, and deposits the money to be remitted. The bank
charges him a commission for this service. He may or may not be the branch’s customer.

R EMITTEE
A Remittee is also called the beneficiary, or the payee. The person in whose name the remittance
is made. A Remittee is also the one who receive the payment.

I SSUING B ANK
The bank that sends or affects the remittance through demand drafts, telegraphic transfers, Mail
Transfers, Pay order etc

P AYING B ANK
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Paying Bank also knows as the drawee branch, the branch on which the instrument is drawn. It
has to make the payment (usually located in a different city or country).

K INDS OF R EMITTANCES
Transfer within the branch
Transfer from one branch to another
Transfer from one bank to another bank in the same city
Transfers from one bank to another bank in two cities.

3. ACCOUNT OPENING DEPARTMENT

The opening of an account is the establishment of banker-customer relationship. This department
performs the duty of opening accounts for customers. It also issues checkbooks to customers. A
person who wishes to open an account with the bank has to fill an account opening form
obtained from any branch of National Bank of Pakistan. The bank officer tactfully obtains
information about character, integrity, responsibility, occupation and the nature of business of
the perspective customer.Any individual, who has attained the age of majority and is of sound
mind can open and maintain his/her account. Two or more individuals may open an account
jointly. Similarly, business organizations such as sole proprietary concerns, partnership firms,
and limited liability companies as well as non-profit organizations like clubs, trusts, societies,
associations and NGO’s etc, may open their accounts. The documents required for National
Bank of Pakistan’s Account opening are showed as Annexed VII at the end of this report.

The following requirements are necessary for opening an account.

Identification of the new customer.

Ascertaining the genuineness of the stated occupation business of the customer.
Determining the correct residential and permanent address.
Completion of all relevant columns of the Account opening form.
Proper completion of documentation.
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F UNCTIONS OF A CCOUNT O PENING D EPARTMENT

Providing account opening form according to the customer's requirements,
Guide the customer about the requirements of the account opening and form filling,
Check the forms whether they are correctly completed or not,
Preparing checklist,
Stamping on the form,
Maintaining account opening register,
Pasting of forms in register after release from general banking in charge,
Issuance of cheque books,
Issuance of accounts maintenance certificate,
Closure of account
Verification of signature in case of cheque presented before releasing of account opening
from SS card is not yet scanned

4. CASH DEPARTMENT
All physical movement of cash in the bank is made through the cash department. As bank is
borrowing and lending institution, therefore cash is the top most priority of Bank. Another aspect
is that cash department is for the security purpose, security in a sense that there should be no
embezzlement of funds or in money leaded to bank by any party or person. The efficiency of
bank is also related to this department the more efficient the bank is the stronger and busy is the
cash department. Cash department perform following functions

Cash department owes its important to the fact that it is a major point of contract between the
bank and the customer, the bank’s most valued relationships. This department is the showcase of
the bank and conveys the first impressions about the bank’s commitment to professionalism in its
systems and procedures and to courteous and efficient customer service.

Normally cash department performs following functions

Collection of funds
Acceptance of deposits
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Collection of utility bills

Payment of checks
Remittances
Act according to any standing instructions
Transfer of funds from one account to another
Verification of signatures
Posting
Handling of Prize bond

The two main activities of cash department are as fallows:

D EPOSIT C ASH I N C USTOMER ’ S A CCOUNT

When the customer want to deposit amount in his account at opening of account or after that then
he has to fill a deposit slip that shows the amount and the account in which the cash will be
deposited. Then teller will receive amount and credit the customer’s account that shows increase
in customer’s bank account.

M AKE P AYMENTS F ROM C USTOMER ’ S A CCOUNT

When the customer draws a cheque on the bank to pay a certain amount then BBO Operator will
debit the customer’s account that shows reduction in his account balance.

C HEQUE ENCASHMENT PROCEDURE

R ECEIVING O F C HEQUES
The cash is paid against the cheques of the client. The following points are important.
Cheque is drawn on same branch
Cheque is not post dated.
Amount in words and figure are same.
It should be bearer cheques so the word bearer should not cross.

V ERIFICATION OF S IGNATURE
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After receiving the cheques the cheques the operation manager verify the signature of the
account holder and the signature on the cheques. If the signature is not same it is returned back
otherwise forward to BBO Operator for posting.

C OMPUTER T ERMINAL P ROCESS

The cheque is received in computer terminal, where BBO operator checks the balance of the
account holder. The BBO operator also sees the stop payment instructions, whether received
from account holder or not. After considering these points BBO Operator post the cheque in
BBO (Branch back office system) and forward to operation manager.

P AYMENT O F C ASH
After posting the cheque the operation manager cancelled the cheque and returned back to
cashier. The cashier enters the cheque in cash paid registered and pays against the second
signature of receiver on the back of the cheque.

5. DEPOSITS DEPARTMENT
The primary function of National Bank of Pakistan is to accept and receive surplus money from
the people, which they willingly deposit with the Bank. Like all other Banks, National Bank of
Pakistan also take incitation to attract as much depositor’s as it can. The deposit department
accepts/collects deposit from accountholders.

The National Bank of Pakistan offer different deposit schemes to its customers, which includes
the following:

Current Deposits
PLS Saving Deposits
Fixed Deposit Account ( Time Deposits)
Foreign Currency Account
NBP Premium Aamdani
Foreign Currency Account
National Income Daily Account (NIDA)
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6. ADVANCES DEPARTMENT
The bank is profit seeking institution. It attracts surplus balance from the customer at low rate of
interest and makes advances at a higher rate of interest to the individuals and business firms.
Credit extensions are the most important activity of all the financial institutions, because it is the
main source of earnings. Advances department is one of the most sensitive and important
department of the bank. The major portion of the profit is usually earned through this
department. The job of this department is to make proposals about the loans; the credit
management division of head office directly controls all the advances.

The advances Department receive application from intending borrowers. After receiving
application the advance department processes it further. After analyzing and detailed
investigation, they decide whether to approve the loan or not. Some loan approvals are made by
the Manager of the branch within his powers as prescribed by the bank’s higher authorities,
while some loan applications are submit to higher authorities for their approval. Some advances
are of the following nature

Loan against Gold

Agriculture advance to farmers
Medium term advance for working capital
Long term advance for setting industry
Short term advance to businessman

The National Bank of Pakistan offer following products (Advances) to its customers

NBP Saibaan
NBP Advance Salary
NBP Cash & Gold
Students Loan Scheme
NBP Karobar

The Advances department deals in following transactions:

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1. Preparation and submission of proposals of Running finance, Cash finance, Demand

finance, Export finance, Staff finance, Finance against imported merchandise etc for
sanction of finance limit from the hire authority.
2. Preparation and posting of vouchering of all type of finance.
3. Accruals & recovering of Markup on finances on periodical basis.
4. Approval of transfer of funds through DD-TT, PO, MT, IBCO etc to various branches by
debiting the limits.
5. Preparation of weekly, monthly, quarterly, and annually statement to the hire authority.
6. Transfer of funds from one account to another account of the party taking the authority
letter.
7. Preparation of advances record.
8. Timely submission of returns/reports, daily, weekly, monthly & quarterly.
9. Checking of computer outputs of the department on daily basis.
10. Balancing of all financing heads.

7. COMPUTER DEPARTMENT
This department is playing a very important role in making the banking procedures faster and
helping the bank for providing better services to its customers. The National Bank of Pakistan
has three types of branches in all over Pakistan, these included

A) ONLINE BRANCHES
The branches, which are directly, link with central computer AS-400, through wide area
networking through fiber optics. These branches have dumb terminal directly linked with central
computer.

B) BATCH BRANCHES
The branches where all transactions are carried out with the computer base system but these
branches are not connected to the central computer with wide area net working. Batch branches
are using three type of system, Branch Back Office (BBO) based on FoxPro, Branch Automated
System based (BAS) on UNIX, Branch Integrated System (BIS) based on FoxPro in Karachi
mostly branches are facing this problem. BAS was establish in the beginning while BBO is
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currently implemented now efforts are under way to convert all branches into Electronic Banking
System (EBS) which is used by online branches as this system does not require a person to
remain sitting till the branch closed its daily operation but the system automatically close it self
when the branch timing is over. The database in head office is also based on this system.

C) MANUAL BRANCHES
The branches where all transactions are carried out manually and records are maintained on
registers usually stored in big wardrobes. Manual branches reports Regional head office
regarding their daily transactions. In Regional head office through On Line, terminal data goes to
head office central computer; Except for branches those are On Line as they transfer there daily
data directly through there own terminal. As day-to-day, activities of all branches are recorded in
a central computer.

E VENING DATA RECEIVING CENTER

Data form batch branches reach the main branch in floppy diskettes while form manual branches
it is in form of hard copy. Data comprises of transactions in profit loss account, current account,
advances etc termed as “Daily Transaction Report”. Clerk in charge register all diskettes and
manual in registers called “job booking register” one for each of two type of data. These floppies
and manual are bring in by riders. There are fourteen riders in total who bring information form
all branches located in Karachi region.

D ATA ENTRY D EPARTMENT

The next task after receiving the data is to enter that data in to a computer. The floppy disk is
directly inserted in the computer. The program in used is based on “COBOL” language. This
program is designed in away that it demand “Hash Value” value before opening the floppy for
further action this value serve the purpose of password or pin code send by the branch on
entering that value the data enter in to the computer. This computer is attached with the terminal
of central computer. The operator of that terminal takes the data from the computer and
converted it in to a text file through that terminal the data finally goes to the central computer.
 P a g e | 64

D EFECTS AND E RROR H ANDLING

Errors of different origin occur when the data goes to central computer. Sometime retrieving data
from the system (BAS, BBO, and BIS), other than used in HO (EBS) also caused errors. Other
errors include Unmatched (This error occurs when document no matched with the previous one
exists), no master (when opening of new account is not mentioned), Date in Valid, duplicate
cheques (this error occur when the last objection is not removed). These and other such errors are
seen by the person in charge. In the end of day print out of the data enter in central computer is
taken. AnyIncomplete information for any branch and any information require by that particular
branch is sent to that branch. More over material is used to make a WST which is sent to State
Bank of Pakistan.

8. PENSION DISBURSEMENT DEPARTMENT

The National Bank of Pakistan was Pakistan’s leading institution which performs the function of
pension payments or disbursements to pensioners. The pension disbursement department is
responsible for making pension payments to Government Pensioners. The person who wants to
receive his/her pension from National Bank of Pakistan can open an account with any branch of
National Bank of Pakistan. The bank performs this function through Demand Draft Purchase or
simply called DD Purchase. This department performs following functions:

Making Pension Payments

Opening of Account of Pensioner
Entry of amount paid to pensioner in Government Pensioners Register
Verifications of Signatures of Pensioners
Making Demand Draft Purchase Register

9. ACCOUNTS DEPARTMENT
Accounts Department of the bank can be considered the most important department. This
department is basically concerned with processes and activities of recovering, sorting,
summarizing and reporting data resulting from the whole day transactions of all the departments.
Actually the process of this activity starts from the preparation of all the required vouchers by
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different related departments. When these vouchers are prepared, these are posted into respective
computer terminals by the relevant departments. Before merging, a batch list is printed out by
Computer Department and duly checked by the respective departments. After this, merging stage
comes, after which a proof list is printed out. This is the stage, where Accounts Department
starts performing its function. Proof list is checked by the Accounts Department. The account
department prepare following vouchers and reports
Monthly Profit & Loss account- F48
General Ledger
General Ledger- Abstract
Check Book Issue Register
Western Union payments Register
Demand Notices
Miscellaneous Book
Bank Transfer scroll
Posting NBP Advance Salary
Daily Statement- F21
General Ledger- Head wise
Hash Value Register
End of Day register
Posting National Income Daily Account (NIDA)
Monthly return register
Charges A/c register
P-L-S Profit list
Weekly Telegram
Mail Transfer Register
Government Scroll
Provident file
Government Scroll Debit & Credit
Transfer Responding Advice Dispatched Register-F15
Cash Remittance IN
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Cash Remittance OUT

NBP General Account
Utilities register
Statement of affairs
Closing entries
Daily activity checking
Minor expense recording
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STRUCTURE OF BRANCH’S ACCOUNTS DEPARTMENT

The structure of National Bank of Pakistan’s Accounts department is shown as Annexed VI at
the end of this report. The Accounts department of the branch is controlled by the Chief
Accountant under direct supervision of Branch Manager. The Branch has one cashier & two
clerks for assistance and help of Chief Accountant. The BBO (Branch Back Office system)
Operator has also assist Chief Accountant in various tasks.

The head of branch’s Accounts department is called Chief Accountant, who performs his
functions under direct supervision of Branch Manager. The Chief Accountant is responsible for
the central accounting records and controls over all financial transactions of the Branch. He also
directs a wide variety of accounting activities and meets important deadlines& analyzes and
interprets accounting data of the branch. The other responsibilities of Chief Accountant include:

Plans and directs the activities of Cashier, BBO Operator and clerical employees of the
branch engaged in the maintenance of a variety of accounting records.
Directs and participates in the development and revision of procedures in order to meet
requirements of law, provide services to Branch Manager, improve efficiency in branch
activities, and coordinate branch activities with those of other departments.
Directs and reviews the preparation of periodic and special financial statements, reports,
projections, and recommendations, on which important administrative decisions are
based.
Directs and reviews the study of new and revised laws, rules, and programs affecting the
central accounting system and records and installs or recommends changes as
appropriate.
Designing and operating a system to capture, record, process, and store all relevant
documents and information about the financial activities of the branch.
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Ensuring the integrity and reliability of the information system, and preventing fraud
from inside and outside the branch.
Preparing financial statements that are reported to Regional Management of National
Bank of Pakistan.
Preparing financial statements and accounting reports for distribution to the
branchManager for their planning, control, and decision-making needs.
The Chief Accountant with the help of branch’s clerical staff is preparing following
reports:
o Monthly Profit & Loss account- F48
o Daily Statement- F21
o General Ledger
o General Ledger Abstract
o General Ledger head wise
o Bank transfer Scroll
o Posting NBP Advance Salary
o Misc Book
o Posting National Income Daily Account (NIDA)
o Monthly return file
o Charger List
o PLS Profit list
o Weekly Telegram
o Government Scroll
o Government Scroll Dr & Cr
o Transfer Responding Advice Dispatched Register- F15
o Cash Remittance In
o Cash Remittance Out
o NBP General Account
o Clearing register
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o Debit & Credit supplementary

Debit supplementary is used for debit voucher and credit supplementary is used for credit
voucher books and register maintained by bank are as fallows

General ledger included:

Statement of daily affairs

Cash book or cash cum day book
Transfer book
Income & expenditure ledger

Income& expenditure includes:

1. Discount
2. Service charges
3. Commission from utility services
4. Salaries allowances & provident fund
5. Rent taxes insurance lighting
6. Profit paid on deposits and borrowings
7. Auditor’s fee & legal charges
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BANK ACCOUNTING OPERATIONS

The National Bank of Pakistan’s accounting consists in making computerized, written and
permanent records of every transaction. For Computerized recording of transactions the bank
used software called BBO (Branch Back Office). BBO enable Bank to record a variety of
transactions. The most common part of BBO which is operating by the BBO Operator is
Individual Ledgers. Individual Ledgers are the accounts in which accounts with depositors are
kept.They are kept so that the balance of each depositor's account may at any time be readily
seen, and they should be frequently balanced to verify their correctness. The three column form
of individual ledger is used because it has a column for checks paid or other debit entries, one for
deposits or other items credited, and a third for showing the balance after each entry or the day's
entries are made in the account.The BBO enlist Chart of Accounts of the Bank shown in
Annexed VIII. All the accounts shown in Annexed are opened and managed through BBO. All
the Remittances of the bank are recorded managed and control through BBO. The “End of the
Day” report is also generated through BBO.

The most important record keeping and report generated by Bank’s Accounts Department is
Statement of the Bank.The statement of the bank shows the general, or control, accounts of the
bank, and the various books of the bank show the detail of these items. It would not be
impossible, but it would be entirely impractical, to enter every figure directly on the statement of
condition. Instead of total deposits, the balance of each depositor would appear opposite his
name. On the other side, instead of loans and discounts, there would be an itemized list of the
loans with the names of the borrowers.The first principle in bank accounting, as in all other
bookkeeping, is that for every debit there must be a credit, and vice-versa. In accordance with
this fundamental theory the books are maintained. With respect to the statement, every Rupee of
liabilities is accounted for by another Rupee of resources. Similarly each accounts at the end of
the day for each item of cash is balanced.Each bank employee has had the experience of
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remaining at his desk until a late hour at night checking up his day's work searching for a
difference of a few cents. Often they become embittered at what seems to them a tyranny when
the small sum of money involved is considered. The reason they must settle, however, is not on
account of the possible loss of ten cents, but because the most important principle in bank
accounting is involved. "Accuracy first" is a motto that should be framed, figuratively at least,
upon the wall of every banking room.

The books used by National Bank of Pakistan are of various kinds and their purpose is indicated
by name. A ledger is a book used to keep a record of balances. To "post" means to enter in the
proper columns either the debits or credits on the ledger, and the difference between them
represents the balance either due by or to the bank. Another important book which is used by the
National Bank of Pakistan is journal, a book in which daily transactions are listed in regular
order as to accounts, and the total debit or credit is then posted on the ledgers. All other books,
cards and sheets used by bank of whatever nature is a part or subdivisions of these books. Often
they become known among the clerks by some other name descriptive of their general
appearance. For instance, the general ledger scratcher in one bank is known as the "red book,"
while the collection scratcher is the "black book."

The records made by one clerk upon one set of booksgo to check the records of another clerk
upon a different set of books. For instance, the paying teller and the receiving teller will each
keep a record of checks cashed or deposited payable within the bank. The debit postings of the
individual bookkeeper would agree with the teller's figures. Skillful accounting lies in making
the fullest possible use of original entries, at the same time having a check on all figures to guard
against either error or fraud.

Every transaction ultimately affects the bank's statement of condition by debit or credit. For
example, a deposit of Rs.1000 is made, consisting of Rs.200 cash and checks as follows: Rs.200
on the bank itself and Rs. 600 payable in another city. At the end of the day (assuming this to be
the only deposit), on the liabilities side there is an increase of Rs 800 all of which appears in the
item "deposits" being the total Rs.1000, less the check for Rs 200 which is charged to the
account of the drawer. On the resource side, then, a corresponding increase of Rs.800 and this is
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made up by an increase in the cash of Rs 200 and an increase of Rs.600 in the item "due from
banks." Or a transaction may appear on one side of the statement only. The bank has sold Rs.5,
000.00 of the bonds it owns.

ROLE OF CFO (CHIEF FINANCIAL OFFICER)

The performance of any organization is reflected by the financial statements, any ambiguityif
remains there, makes the reflection of the performance doubtful. Therefore, the role of CFO
becomes very important as he controls the reflection of performance, which is reported to
different authorities and the organization is assessed by them, and they must perform their job
with professional competency and integrity, so that the financial statements give credible
information to its users. The code of corporate governance provides the guidelines and
opportunity to do this.

The Chief Financial Officers of United Bank Limited used to perform several tasks which were
preparing accounts, preparing budgets, operational reporting and interpreting, evaluating
operating results, preparing income tax returns, establishing internal control procedures to safe-
guard the companies assets.

Due to increased governance requirement there arises a need to empower the chief accountant
and to make him responsible by requiring him to sign the accounts. There comes the code of
corporate governance, which makes the chief accountant powerful and more responsible. With
the new role, Chief Accountant becomes Chief Financial Officer (CFO). The appointment,
removal and remuneration terms and conditions of employment of the chief financial officer of a
listed company shell are determined by the Chief Executive Officer with the approval of the
Board of Directors.

Q UALIFICATION R EQUIREMENT
The qualification requirement is defined under the code of corporate governance that is the
person appointed as the Chief Financial Officer must be

Member of recognized body of professional accountants or

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A graduate from a recognized university or equivalent, having at least 5 years experience

in handling financial and corporate affairs of a listed company.

R ESPONSIBILITIES OF CFO
The new responsibilities apply to all Chief Financial Officers of Listed Companies, Insurance
Companies, Banks and DFIs. Mostly the CFO presents the financial position relating to the
period which has been over, and the period which has to come that is the financial position
attained and the financial projection i.e. where the organization will be.

R ESPONSIBILITIES TOWARDS B OARD OF D IRECTORS

The Chief Financial Officer is required to furnish necessary and classified information to the
board of directors along with his analysis and suggestions as the Chief Financial Officer attends
the board meetings, any issue with financial implications is being discussed, the person likely to
be most in command of these implication is on the spot and immediately available for questions.

In order to strengthen and formalize corporate decision-making process, significant issues are
required to be placed for the information, consideration and decision of the boards of directors by
the CFO. These are:

Annual business planes, cash flow projection, forecasts and long term planes.
Budgets include capital, manpower and overhead budgets along with variance
analyses.
Quarterly operating results of the company as a whole and in terms of its operating
divisions or business segments.
Details of joint ventures or collaboration agreements or agreements with distributors,
agents, etc.
Default in payment of principal and/or interest, including penalties on late payments
and other dues, to a creditor, bank or financial institution, or default in payment of
public deposit.
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Failure to recover material amounts of loans, advances, and deposits made by the
company, including trade debts and inter-corporate finances.
Significant public or product liability claims likely to be made against the company,
including any adverse judgment or order made on the conduct of the company.

R ESPONSIBILITIES TOWARDS S HAREHOLDERS

The Chief Financial Officer is required to provide all the necessary data to be presented in the
“Director’s Report”. For this purpose Chief Financial Officer must ensure the following.

The financial statement, prepared by the management of company, present fairly its states
of affairs, the results of its operation, cash flows and changes in equities.
Proper books of accounts of the company have been maintained
Appropriate accounting policies have been consistently applied in preparation in financial
statements and accounting estimates are based on reasonable and prudent judgment.
International accounting standards, as applicable in Pakistan, have been followed in
preparation of financial statements and any departure there from has been adequately
disclosed.
The system of internal control is sound in design and has been effectively implemented
and monitored.
There are no significant doubts upon the companies’ ability to continue as going concern.
There has been no material departure from the best practice of corporate governance as
detailed in the listing regulations.

I NTERNAL AND E XTERNAL R EPORTING

Chief Financial Officer now has extensive responsibilities for internal and external reporting. All
the information required for decision-making by the Board of Directors and Chief Executive is
processed and furnished by the Chief Financial Officer. Apart from this, external reporting
requirement is fulfilled by Chief Financial Officer, the accounts and financial statements are
signed by the Chief Financial Officer before they are sent to concerned authorities.CCG requires
that the listed companies submit their quarterly accounts to the shareholders within one month of
the close of the first and third quarter of year of account. The CCG does not prescribe the time
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for submitting half yearly accounts to the shareholders. Here we can refer to section 245 of
companies’ ordinance 1984 for this purpose, which requires half yearly accounts to be submitted
within two months of the close of first half. The CCG requires a limited review of half yearly
accounts by external auditor.Annual audited accounts are now required to be submitted within
four months of the close of financial year.

The Securities and Exchange Commission of Pakistan is exercising strict vigilance to ensure
compliance of 4th and 5th schedule of the Companies Ordinance, 1984 and timely submission of
accounts by companies. It has recently imposed penalties on Directors of nine listed companies
who failed to prepare and circulate the quarterly accounts. Furthermore, fines have been imposed
on chief executives.
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USE OF ELECTRONIC DATA IN DECISION MAKING

The technological development in the field of information systems make it possible for
management to use electronic data in decision making. An understanding of the effective and
responsible use and management of information systems and technologies is important for
managers, business professionals, and other knowledge workers in today’s internetworked
enterprises. Information systems play a vital role in the e-business and e-commerce operations,
enterprise collaboration and management, and strategic success of businesses that must operate
in an internetworked global environment. Thus, the field of information systems has become a
major functional area of business administration. The management of a business can use
information systems in their decision making process. Before proceeds it’s important to discuss
precisely about decision making.

Decision making can be regarded as an outcome of mental processes leading to the selection of a
course of action among several alternatives. Every decision making process produces a final
choice.32 The output can be an action or an opinion of choice.A significant part of decision
making skills is in knowing and practicing good decision making techniques. One of the most
practical decision making techniques can be summarized in following simple decision making
steps:

1. Identify the purpose of your decision. What is exactly the problem to be solved? Why it
should be solved?
2. Gather information. What factors does the problem involve?
3. Identify the principles to judge the alternatives. What standards and judgment criteria
should the solution meet?
4. Brainstorm and list different possible choices. Generate ideas for possible solutions.
See more on extending your options for your decisions on my brainstorming tips page.
5. Evaluate each choice in terms of its consequences. Use your standards and judgment
criteria to determine the cons and pros of each alternative.
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6. Determine the best alternative. This is much easier after you go through the above
preparation steps.
7. Put the decision into action. Transform your decision into specific plan of action steps.
Execute your plan.
8. Evaluate the outcome of your decision and action steps. What lessons can be learnt?
This is an important step for further development of your decision making skills and
judgment.

The decision making of Management of National Bank of Pakistan rely on information system
resources which includes people and a variety of hardware, software, data, and communications
network technologies as resources to collect, transform, and disseminate information in Bank.

INFORMATION SYSTEM RESOURCES OF UBL

A) PEOPLE RESOURCES
People are required for the operation of all information systems. These people resources include
end users and Information system Specialists. The Management and employees of National Bank
of Pakistan are end users and Knowledge workers of information system. These are the
employees of the Bank who spend most of their time communicating and collaborating in teams
and workgroups and creating, using and distributing information.

The Information systems Specialist are people who develop and operate information systems.
They include System analysts, software developers, system operators, and other managerial,
technical, and clerical IS personnel of National Bank of Pakistan. The system analysts of
National Bank of Pakistan design information systems of the Bank based on the information
requirements of the end users. The software developers create computer programs based on the
specification of system analysts of National Bank of Pakistan.

B) HARDWARE RESOURCES
The Hardware resources of National Bank of Pakistan include all physical devices and materials
used in information processing. Specifically, it includes not only machines, such as computers
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and other equipments, but also all data media, that is, tangible objects on which data are
recorded, from sheets of paper to magnetic or optical disks.

C) SOFTWARE RESOURCES
The software resources of National Bank of Pakistan include all sets of information processing
instructions. It also includes sets of operating instructions called programs, which direct and
control computer hardware. The followings are the examples of National Bank of Pakistan’s
software resources:

System Software:The National Bank of Pakistan uses Windows Operating Systems for
controls and supports the operations of a computer system.
Application Software: These are the programs that direct processing for a particular use
of computers by employees of the Bank. Bank uses BBO system, Microsoft Office suit as
application software.

D) DATA RESOURCES
The data resources of National Bank of Pakistan are typically organized, stored, and accessed by
a variety of data resource management technologies. The data about Branch transactions is
accumulated, processed, and stored in a BBO system that can be accessed by Manager for an
analysis and decision making.

E) NETWORK RESOURCES
The network resources of National Bank of Pakistan include:

Communication Media: The Bank’s communication media include cellular and

landline.
Network Support: The Bank uses hardware, software, and data technologies which are
needed to support the operation and use of a communication network. The Bank uses
communication processers such as Modems and internetwork processors, and
communication control software such as network operating systems and Internet Browser
packages (Opera).
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SOURCES OF FUNDS
Rupees in
Millions          
Year   2004 2005 2006 2007 2008
Share Capital 4,924,106 5,908,927 7,090,712 8,154,319 8,969,751
10,813,91 13,536,04 13,879,26 15,772,12 19,941,04
Reserves   4 1 0 4 7
11,084,79 11,704,07 10,886,06 40,458,92
Borrowings 0 8,756,847 9 3 6
465,571,7 463,426,6 501,872,2 591,907,4 624,939,0
Deposits 17 02 43 35 16
23,068,31 24,974,45 26,596,30 30,869,15 39,656,83
Other Liabilities 4 0 0 4 1
      Horizontal Analysis (%)  
Share Capital 100 120 144 166 182
Reserves   100 125 128 146 184
Borrowings 100 79 106 98 365
Deposits   100 100 108 127 134
Other
Liabilities   100 108 115 134 172
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GENERATION OF FUNDS
Rupees in
Millions              
Year   2004 2005 2006 2007 2008
20,947,33 33,692,66 44,100,93 50,569,48 60,942,79
Markup/return/interest earned   3 5 4 1 8
14,387,93 23,370,89 30,153,71 33,629,47 37,058,03
Net markup/interest income   5 7 6 0 0
12,639,77 21,146,97 27,782,17 28,906,73 26,087,21
Net markup/interest income after provisions 0 0 0 5 6
12,162,89 13,544,84 16,415,86
Total non-markup/ Interest income 8,304,716 9,392,351 2 5 2
20,944,48 30,539,32 39,945,06 42,451,58 42,503,07
Total income ( Interest + non-Interest) 6 1 2 0 8
PROFIT BEFORE 11,977,60 19,056,02 26,310,57 28,060,50 23,000,99
TAXATION   1 8 7 1 8
          Horizontal Analysis (%)  
Markup/return/interest earned   100 161 211 241 291
Net markup/interest income   100 162 210 234 258
Net markup/interest income after provisions 100 167 220 229 206
Total non-markup/ Interest income 100 113 146 163 198
Total income ( Interest + non-Interest) 100 146 191 203 203
PROFIT BEFORE
TAXATION   100 159 220 234 192
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ALLOCATION OF FUNDS
Rupees in
Millions              
Year       2004 2005 2006 2007 2008
Lending’s to Financial Institutions 10,511,322 16,282,942 23,012,732 21,464,600 17,128,032
149,350,09 156,985,68 139,946,99 210,787,86 170,822,49
Investments 6 6 5 8 1
220,794,07 268,838,77 316,110,40 340,677,10 412,986,86
Advances     5 9 6 0 5
Operating Fixed Assets   9,202,969 9,454,365 9,681,974 25,922,979 24,217,655
Other Assets     19,141,569 23,941,056 37,113,698 30,994,965 44,550,347
          Horizontal Analysis (%)  
Lending’s to Financial Institutions 100 155 219 204 163
Investments     100 105 94 141 114
Advances   100 122 143 154 187
Operating Fixed Assets   100 103 105 282 263
Other Assets     100 125 194 162 233
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CRITICAL ANALYSIS (THEORY VS PRACTICAL)

During Internship it was my prime objective to furnish my knowledge (Theory) to various
practical situations. The practical work presents an analytical problem while relating theory with
practice. As a result, analysis of practical versus theory requires a distinct approach. This part of
report is the essence of the internship, as this will help to better understand the working
environment of the bank by finding the relationship between what is written in the books and
what is actually going on in fields. The theory written in the books in cases is not implemented
as it is. In some cases theory is implemented with a little modification but in other cases theory
has nothing to do with practice.

In accounting, banks don’t prepare worksheet, but part of worksheet is prepared like trial
balance. The securities for the loans are handled in the same way as theory says like mortgage,
pledge, hypothecation, advances against insurance policies or liquidation procedure is the same.
There is some difference lies in types of loans in bank that is theory talks about four or five types
of loans that is cash finance, overdraft, loans etc., but in practice there are some more types used
by bank like running finance, demand finance etc. All other concepts of remittances, bills,
foreign exchange deposits, letters of credit are in accordance with theory almost.A bank's
balance sheet is different from that of a typical company. You won't find inventory, accounts
receivable, or accounts payable. Instead, under assets, you'll see mostly loans and investments,
and on the liabilities side, you'll see deposits and borrowings.

C ONCLUSION
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To me, Theory gives the direction to understand the processes and the terminologies going
across the World using best business practices in a broader view covering each and every aspect
of possible business scenarios. On the contrary practical life is specific, enclosed in a jar.

BALANCE SHEET
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INCOME STATEMENT

Income Statement as on 31st Dec.

  2004 2005 2006 2007 2008

Markup/ return/interest earned 5620203 2078646 3312516 3369266

0 0 5 44100934

Markup/return/ interest expensed 2434459 6185580 1207710 1032176

0 8 13947218

Net markup/interest income 3185744 1460088 2104806 4401443

0 0 3 58048152

Different Provisions          

Provision against non-performing loans and advances-net 370208 1289820 1867140 2446739 3075723

Provision for diminution in the value of investments 2165 113220 73680 245881 709461

Bad debts written off directly 351 1441320 2206140 2306930 528425

Total Provision 372724 2844360 4146960 4999550 4313609

Net markup/interest income after provisions 2813020 1175652 1690110 3901488

0 0 3 53734543

NON MARK-UP/INTEREST INCOME          

Fee, commission and brokerage income 4280504 5465880 6267420 2492660

4 66144628

Dividend income 4280504 5465880 6267420 1718478 2891755

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Income from dealing in foreign currencies 4280504 5465880 6267420 1205632

8 1333840

Other income including gain on sale of securities, 4280504 5465880 6267420 1365757
1 1169515

Total non mark-up/interest income 1993503 3362004 4197078 5235898

6 0 0 1 71539738

2274805 4537656 5887188 9137386

Total Revenue 6 0 0 4 53734543

NON MARK-UP/ INTEREST EXPENSES          

Administrative expenses 2677635 8457780 1146366 1122178

0 9 13443441

Other provisions/ write off 450000 337500 222960 17283 168027

Other charges 1700 25628 7080 63206 208327

Total non- markup/ interest expenses 1139370 1130227

3129335 8820908 0 8 13819795

PROFIT BEFORE TAXATION 1961872 3655565 4747818 8007158

1 2 0 6 39914748

Taxation          

For the year –Current 586159 1356000 1524000 7154002 8695598

-Deferred 3663 80160 44520 1098709 530652

For prior year –Current 30000 2969580 1344000 291291 61981

Total TAXATION 619822 4405740 2912520 8544002 9288231

Net Profit After Tax 1899889 3214991 4456566 7152758

9 2 0 4 30626517
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FINANCIAL STATEMENTS ANALYSIS

Financial analysis is a process which involves reclassification and summarization of information
through the establishment of ratios and trends.Financial statement analysis is the process of
examining relationships among financial statement elements and making comparisons with
relevant information. It is a valuable tool used by investors and creditors, financial analysts, and
others in their decision-making processes related to stocks, bonds, and other financial
instruments. The goal in analyzing financial statements is to assess past performance and current
financial position and to make predictions about the future performance of a company. Investors
who buy stock are primarily interested in a company's profitability and their prospects for
earning a return on their investment by receiving dividends and/or increasing the market value of
their stock holdings. Creditors and investors who buy debt securities, such as bonds, are more
interested in liquidity and solvency: the company's short-and long-run ability to pay its debts.
Financial analysts, who frequently specialize in following certain industries, routinely assess the
profitability, liquidity, and solvency of companies in order to make recommendations about the
purchase or sale of securities, such as stocks and bonds.

The analysis of financial statement refers to the examination of the statements for the purpose of
acquiring additional information regarding the activities of the business. The users of the
financial information often find analysis desirable for the interpretation of the firm’s activities.
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The overall objective of financial statement analysis is the examination of a firm’s financial
position and returns in relation to risk. This must be done with a view to forecasting the firm’s
future prospective.

Analysts can obtain useful information by comparing a company's most recent financial
statements with its results in previous years and with the results of other companies in the same
industry. Three primary types of financial statement analysis are commonly known as horizontal
analysis, vertical analysis, and ratio analysis.

RATIO ANALYSIS
Ratio analysis enables the analyst to compare items on a single financial statement or to examine
the relationships between items on two financial statements. After calculating ratios for each
year's financial data, the analyst can then examine trends for the company across years. Since
ratios adjust for size, using this analytical tool facilitates intercompany as well as intercompany
comparisons. Ratios are often classified using the following terms: profitability ratios (also
known as operating ratios), liquidity ratios, and solvency ratios. Profitability ratios are gauges of
the company's operating success for a given period of time. Liquidity ratios are measures of the
short-term ability of the company to pay its debts when they come due and to meet unexpected
needs for cash. Solvency ratios indicate the ability of the company to meet its long-term
obligations on a continuing basis and thus to survive over a long period of time. Financial ratios
allow for comparison:

Between companies
Between industries
Between different time periods for one company
Between a single company and its industry average
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HORIZONTAL ANALYSIS
This technique is also known as comparative analysis.It is conducted by setting consecutive
balance sheet, income statement or statement of cash flow side-by-side and reviewing changes in
individual categories on a year-to-year or multiyear basis. The most important item revealed by
comparative financial statement analysis is trend. A comparison of statements over several years
reveals direction, speed and extent of a trend(s). The horizontal financial statements analysis is
done by restating amount of each item or group of items as a percentage.Such percentages are
calculated by selecting a base year and assign a weight of 100 to the amount of each item in the
base year statement. Thereafter, the amounts of similar items or groups of items in prior or
subsequent financial statements are expressed as a percentage of the base year amount. The
resulting figures are called index numbers or trend ratios.

Formula = Current Year amount / Base Year amount * 100

Horizontal analysis, whilst simple to execute and useful to a certain extent, has its limitations.
These limitations include:

Being highly dependent on the selection of base year and the period under examination in
the financial model.
Horizontal analysis provides little insight into why the trend occurred in a financial
model.
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Horizontal analysis does not provide insight into whether the trend in the financial model
results was superior/inferior to some benchmark.

Horizontal analysis does not address the challenge of negative numbers.

HORIZONTAL ANALYSIS OF BALANCE SHEET

Horizontal Analysis
          (%)  
ASSETS     2004 2005 2006 2007 2008
Cash     100 75 83 100 113
Balances with other banks 100 62 82 75 77
Lending’s to fin. institutions 100 155 219 204 163
Investments   100 105 94 141 114
Advances   100 122 143 154 187
Operating fixed assets 100 103 105 282 263
Other assets   100 125 194 162 233
Total
Assets 100 104 117 138 148
LIABILITIES   2004 2005 2006 2007 2008
Share Capital   100 120 144 166 182
Reserves   100 125 128 146 184
Unappropriated profit 100 182 350 495 573
Surplus On Reval. of assets 100 179 135 221 99
Bills payable   100 24 147 98 142
Borrowings   100 79 106 98 365
Deposits and other accounts 100 100 108 127 134
Liabilities against assets 100 97 78 197 148
subject to finance lease          
Deferred tax liabilities net 100 15291 8179 17467 Nil
Other liabilities   100 108 115 134 172
Total Liabilities   100 104 117 138 133
 P a g e | 90

HORIZONTAL ANALYSIS OF INCOME STATEMENT

2004 2005 2006 2007 2008
Markup/return/interest earned 100 161 211 241 291
Markup/return/interest expensed 100 157 213 258 364
Net markup/interest income 100 162 210 234 258
Provisions against non-performing advances 100 161 203 312 699
provision for/(reversal of) diminution in the value    
of investments 100 -132 -382 -22 201
provision against off balance sheet obligations 100 Nil Nil Nil 28
bad debts written off directly 100 70 16 122 Nil
100 127 136 270 628
Net markup/interest income after provisions 100 167 220 229 206
NON MARKUP/ INTEREST INCOME
Fee, Commission & brokerage income 100 97 121 133 155
Dividend income 100 135 227 256 226
Income form dealing in foreign currencies 100 119 132 103 393
Gain on sale & redemption of securities-net 100 2,872 2,459 4,924 831
Investments classified as held for trading Nil Nil Nil Nil Nil
Other income 100 20 72 17 142
Total non-markup/ Interest income 100 113 146 163 198
Total income ( Interest + non-Interest) 100 146 191 203 203
NON MARKUP/ INTERSET EXPENSES
Administration expenses 100 126 151 160 205
Other provisions written off 100 615 -54 521 2,318
Other charges 100 763 2,515 207 7,042
Total non markup/ Interest expenses 100 129 153 161 219
PROFIT BEFORE TAXATION 100 159 220 234 192
Taxatio
n Current 100 145 176 168 238
 P a g e | 91

Prior years 100 -130 63 46 Nil

Deferre
d 100 -1,852 -394 -2,058 26,831
100 110 161 156 130
PROFIT AFTER TAXATION 100 205 275 307 250
Unappropriated Profit brought forward 100 155 329 544 769
Transfer from surplus on revaluation of fixed    
assets on account of incremental depreciation 100 95 90 86 287
Profit available for appropriation 100 181 300 422 502

VERTICAL ANALYSIS
When using vertical analysis, the analyst calculates each item on a single financial statement as a
percentage of a total. The term vertical analysis applies because each year's figures are listed
vertically on a financial statement. The total used by the analyst on the income statement is net
sales revenue, while on the balance sheet it is total assets. This approach to financial statement
analysis, also known as component percentages, produces common-size financial statements.
Common-size balance sheets and income statements can be more easily compared, whether
across the years for a single company or across different companies.

Vertical analysis is a technique for identifying relationship between items in the same financial
statement by expressing all amounts as the percentage of the total amount taken as 100. In a
balance sheet, for example, cash and other assets are shown as a percentage of the total assets
and, in an income statement, each expense is shown as a percentage of the sales revenue.

In Vertical analysis, various components of the financial statements are standardized by

expressing them as a percentage of some bases.

Examples of common-sized statements include:

Components of the balance sheet expressed as a percentage of total assets

Components of the income statement expressed as a percentage of sales or revenue
 P a g e | 92

VERTICAL ANALYSIS OF BALANCE SHEET

          Vertical Analysis (%)  
ASSET
S     2004 2005 2006 2007 2008
Cash     17.07 12.32 12.19 12.45 13.02
Balances with other banks 9.00 5.37 6.30 4.92 4.69
Lending’s to fin. institutions 1.90 2.82 3.57 2.82 2.09
Investments   27.00 27.17 21.69 27.66 20.88
Advances   39.91 46.53 49.00 44.70 50.50
Operating fixed assets 1.66 1.64 1.50 3.40 2.96
Other assets   3.46 4.14 5.75 4.07 5.45
Total     100 100 100 100 100
LIABILITIES   2004 2005 2006 2007 2008
Share Capital   0.89 1.02 1.10 1.07 1.09
Reserves   1.95 2.34 2.15 2.07 2.43
Unappropriated profit 1.66 2.89 4.97 5.95 6.41
Surplus On Reval.of assets 3.86 6.61 4.48 6.18 2.57
Bills payable   1.30 0.30 1.64 0.93 1.25
Borrowings   2.00 1.52 1.81 1.43 4.94
Deposits and other accounts 84.15 80.22 77.79 77.66 76.42
Liabilities against assets 0.0031 0.0029 0.0021 0.0044 0.0030
subject to finance lease          
Deferred tax liabilities net 0.01 0.77 0.37 0.67 Nil
Other liabilities   4.17 4.32 4.12 4.05 4.85
Total     100 100 100 100 100
 P a g e | 93

VERTICAL ANALYSIS OF INCOME STATEMENT

2004 2005 2006 2007 2008
Markup/return/interest earned 100 110 110 119 143
Markup/return/interest expensed 31 34 35 40 56
Net markup/interest income 69 77 75 79 87
Provisions against non-performing advances 7 8 8 11 25
provision for/(reversal of) diminution in the value    
of investments 1 -1 -2 0 1
provision against off balance sheet obligations 0 Nil Nil Nil 0
bad debts written off directly 0 0 0 0 Nil
8 7 6 11 26
Net markup/interest income after provisions 60 69 70 68 61
NON MARKUP/ INTEREST INCOME
Fee, Commission & brokerage income 24 16 15 16 19
Dividend income 6 6 7 8 7
Income form dealing in foreign currencies 5 4 3 2 9
Gain on sale & redemption of securities-net 0 4 3 6 1
Investments classified as held for trading Nil 0 0 0 0
Other income 4 1 2 0 3
Total non-markup/ Interest income 40 31 30 32 39
Total income ( Interest + non-Interest) 100 100 100 100 100
NON MARKUP/ INTERSET EXPENSES
Administration expenses 42 37 34 33 43
Other provisions written off 0 2 0 1 5
Other charges 0 0 1 0 1
Total non markup/ Interest expenses 43 38 34 34 46
PROFIT BEFORE TAXATION 57 62 66 66 54
Taxatio
n Current 24 23 22 20 28
Prior years 4 -4 1 1 Nil
 P a g e | 94

Deferre
d 0 1 0 1 -10
28 21 23 21 18
PROFIT AFTER TAXATION 30 42 43 45 36
Unappropriated Profit brought forward 28 30 48 76 107
Transfer from surplus on revaluation of fixed    
assets on account of incremental depreciation 0 0 0 0 0
Profit available for appropriation 58 72 91 120 143

BANK ANALYSIS WITH REFERENCE TO COMMERCIAL

BANKS LISTED ON STOCK EXCHANGE
Financial Position of Commercial
      Banks      
        Registered in Pakistan        
Name
of         As of June 2008        
Paid Reserve Asset Deposit Advance Earning
Commercial up s s s s Profit s Branch Credit
Capita (Rs. (Rs. (Rs. After Per Networ
Bank   l Bn) Bn) Bn) (Rs. Bn) Tax share k Rating
(Rs. (Rs.
    Bn)         Bn) (Rs) (Nos)  
Habib Bank 7.59 23.6 735.71 584.85 411.36 7.5 9.75 1400 AA+
NBP   8.97 18.54 788.12 621.53 173.42 8.1 9.03 1249 AAA
Allied Bank 6.46 5.48 344.7 293.97 168.45 2.51 3.88 757 AA
MCB   6.28 35.88 450.34 350.72 228.98 7.68 12.22 1038 AA+
United Bank 10.12 12.82 576.02 465.54 328.55 5.59 5.53 1100 AA+
First Women 0.28 0.22 8.04 6.4 3.09 0.05 1.67 38 BBB+
Bank of Punjab 5.29 7.43 217.85 180.82 142.85 -2.63 -4.97 272 AA-
Soneri Bank 4.11 1.88 81.61 64.73 45.83 0.47 1.13 90 AA-
Askari Bank 4.06 7.59 194.21 153.32 114.04 0.05 1.01 155 AA
Bank Al- Habib 4.79 2.8 167.36 136.75 93.25 1.25 2.61 203 AA
Bank of Khyber 4 1.34 34.43 24.4 11.14 0.11 0.27 34 BBB+
Bank Al- Falah 8 2.95 333.02 287.77 180.02 1.69 2.12 231 AA
Saudi Pak 5 0.22 50.83 42.35 27.62 -0.81 -1.54 55 A-
Faysal Bank 5.3 3.57 137.31 99.61 87.61 0.75 1.41 111 AA
KASB Bank 4.02 0.17 53.66 44.33 32.65 0.08 0.39 41 A
 P a g e | 95

Meezan Bank 4.54 0.81 71.74 57.84 38.3 0.44 0.98 111 A+
-
NIB Bank 28.44 8.46 177.98 112.12 85.43 -0.73 0.23 240 AA
Myban
k   4.24 0.41 45.47 31.96 23.03 0.43 1.02 69 A
-
Atlas Bank 5.01 0.52 30.7 22.18 17.5 -0.2 -0.39 31 A
Standard
Chartered 38.72 1.95 276.38 173.81 126.27 1.31 0.34 176 AA+
JS
Bank   5.11 0.01 24.16 14.08 9.57 0.16 -0.31 11 A-
Habib
Metropolitan 6.02 6.7 192.45 128.97 101.22 1.57 2.6 100 AA+

A stock exchange is a corporation or mutual organization which provides "trading" facilities for
stock brokers and traders, to trade stocks and other securities.The securities traded on a stock
exchange include: shares issued by companies, unit trusts and other pooled investment products
and bonds. To be able to trade a security on a certain stock exchange, it has to be listed there.
The initial offering of stocks and bonds to investors is by definition done in the primary market
and subsequent trading is done in the secondary market. In Pakistan securities are traded on three
stock exchanges which are Karachi stock exchange, Lahore stock exchange and Islamabad stock
exchange.

The financial position of commercial banks registered on stock exchanges in Pakistan, are shown
in preceding page in terms of their:

Paid-up Capital
Reserves
Assets
Deposits
Advances
Profit after tax
Earnings per share
Credit rating
 P a g e | 96

The best way to analyze these commercial banks is to analyze their credit ratings. The National
Bank of Pakistan enjoys the highest credit rating amongst Pakistani banks; JCR- VIS Credit
rating Co. Limited awarded highest standalone credit rating of AAA to NBP. The JCRVIS Credit
rating Co. comments about NBP say a lot about the bank:33
“The organization has been able to strategically manage and build on its competitive advantages
whichhas translated into the strong and well managed improvement in profitability trend
observed over the lastfew years, a substantial balance sheet of sound asset quality, and strong
liquidity and capitalizationlevels”
NBP’s key strength remains its extensive outreach and a low cost, stable deposit base. Deposits
are also guaranteed by the Government of Pakistan under the Banking Nationalization Act, 1974.
There have also been significant improvements in the management practices of the bank and a
focus on enhancement of systems and controls. In this regard the management has entered into
an agreement for the acquisition of a core banking software which is likely to be implemented
over the next few years.
JCR-VIS believes that the current economic situation puts certain leading industrial sectors and
the general consumer under financial stress. Therefore, the second half of 2008 and 2009 are
likely to be challenging for the banking sector as a whole, in terms of maintaining growth, asset
quality and profitability.34
The JCR-VIS Rating Process include following steps:35

1. Signs agreement for an initial rating

2. Submits preliminary information materials
3. Conducts a preliminary study
4. Submits a detailed questionnaire to the issuer/client
5. Provides detailed information in response to detailed questionnaire
6. Conducts pre due diligence meeting analysis
7. Conducts due diligence meetings
8. Conducts post due diligence analysis
9. Brief for internal rating committee meetings is prepared
10. Sub Committee recommends preliminary/initial rating
 P a g e | 97

11. Rating Committee decides the preliminary/initial rating

12. Discusses the rating rationales and rating issues with client
13. Notifies issuer of the preliminary/initial rating, deliberates on appeals by client, if any
14. Consents to release of preliminary/initial rating to the public in case of non-mandatory
ratings
15. Releases the preliminary/initial rating to the press

FUTURE PROSPECTS OF UNITED BANK LIMITED

UBL expects its strong customer focus to drive the Bank’s future business strategy. On the
domestic front, the Bank has already launched its consumer banking business. Increased
investment is targeted in developing human resources, infrastructure and internal systems to
support the aggressive consumer initiative and exploration of new avenues of revenue
generation. The first step under this initiative is the launch of the Bank’s ATM / Debit Card,
branded as UBL Wallet. Furthermore, UBL has introduced a full suite of innovative consumer
finance products designed to capture a significant share of the local consumer financing market
and tap into the current growth in demand for such financing.
 P a g e | 98

SHORT FALLS/ WEAKNESSES OF UNITED BANK LIMITED

 P a g e | 99

CONCLUSIONS
 P a g e | 100

RECOMMENDATIONS
 P a g e | 101

REFERENCES
1

1
S A Haq. (1998) Practice & Law of Banking in Pakistan (6th Ed.)
1

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Principles of marketing 8 ED by Kotler & Armstrong G7

https://www.ubl.com.pk/retail/deposits/business_partner/
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6

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7

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13
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14

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15

16

https://www.ubl.com.pk/retail/loans/address/
17

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18

https://www.ubl.com.pk/retail/loans/cashline/
19

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20

https://www.ubl.com.pk/retail/agricultural/
21

https://www.ubl.com.pk/retail/small_business/
22

Practice & Law of Banking in Pakistan by Dr. Asrar H. Siddiqui 7th ed page no 221

23

Practice & Law of Banking in Pakistan by Dr. Asrar H. Siddiqui 7th ed page no 228

24

Practice & Law of Banking in Pakistan by Dr. Asrar H. Siddiqui 7th ed page no 228

25

https://www.ubl.com.pk/remittances/tezraftaar/default.asp
26

https://www.ubl.com.pk/remittances/tezraftaar/tezraftaarcash.asp
27

https://www.ubl.com.pk/services/hamrah/
28

https://www.ubl.com.pk/services/net_banking/
29

https://www.ubl.com.pk/services/ubl_estatement/
30

Terry and Franklin Principles of Management

31

Management 7 Ed Robbins & coulter

32

Human error by James Reason

33

NBP Annual Report 2007

34

http://www.jcrvis.com.pk

35

http://www.jcrvis.com.pk/ratingscale/rating_process.htm