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Internship Report on Faysal Bank Ltd.

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Definition Of Bank:
There are different definitions of banks according to the function performed with it.
Some of them are:

According to Mr. Crowther:

He defines bank as;

“A bank is a firm which collects money from those who have spare. It lends money to
those who require it.”

According to Mr. Parking:

He defines bank as;

“A bank is a firm that takes deposits from households and firms and makes loans to
other households and firms"

According to www.dictionary.com:

The definition given in this site is:

“A business establishment in which money is kept for saving or commercial purposes


or is invested, supplied for loans, or exchanged”

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Kinds of Bank:
Every bank has different features. On the basis of functions, spheres of activities,
ownership, domicile, etc, the banks are classified into various types, which are:
• Classification on the basis of Functions.
• Classification on the basis of Ownership.
• Classification on the basis of domicile.
• Classification as Scheduled bank and Non-scheduled bank.

Classification on the basis of Function:

On the basis of function, we can classify banks are in the following ways:
• Central Bank
• Commercial Banks
• Exchange Banks
• Saving Banks
• Agricultural Banks

Classification on the basis of Ownership:


On the basis of Ownership, we can classify banks are in the following ways:
• Public sector banks.
• Private sector banks.
• Cooperative banks.

Classification on the basis of Domicile:


On the basis of Ownership, we can classify banks are in the following ways
• Domestic Banks.
• Foreign Banks

Classification as a scheduled &Non-scheduled bank:


On the basis of Ownership, we can classify banks are in the following ways
• Scheduled Banks.
• Non-scheduled Banks.

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LIST OF BANKS OPERATING IN PAKISTAN


NATIONALIZED COMMERCIAL BANKS
First Women Bank, Limited
Habib Bank Limited
National Bank of Pakistan
United Bank Limited

DE-NATIONALIZED COMMERCIAL BANKS


Allied Bank of Pakistan Ltd
Muslim Commercial Bank Ltd

SPEICALIZED SCHEDULED BANKS


Agricultural Development Bank of Pakistan

Federal Bank for Co-operatives

Industrial Development Bank of Pakistan


Punjab Provincial Co-operative Bank Ltd

PRIVATE SCHDEULED BANKS


Askari Commercial Bank Ltd
Bank Alfalah Limited
Bank Al-Habib Limited
Bolan Bank Limited
Faysal Bank Limited
Meezan Bank Limited
Metropolitan Bank Limited
PICIC Commercial Bank Ltd
Platinum Commercial Bank Ltd
Prime Commercial Bank Ltd
Soneri Bank Limited
Union Bank Limited

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PROVINCIAL BANKS
The Bank of Khyber
The Bank of Punjab

MICRO-FINANCE BANKS
The First Micro Finance Bank Limited

FOREIGN BANKS
ABN Amro Bank N.V.
Al-Baraka Islamic Bank B.S.C.(E.C.)
American Express Bank Limited
Bank of Cylon
Credit Agricole Indosuez
Citibank N.A.
Deutsche Bank AG
Doha Bank
Habib Bank A.G. Zurich
International Finance Investment & Commerce bank Limited (IFIC)
Mashraq Bank psc
Oman International Bank S.O.A.G.
Rupali Bank Limited
Standard Chartered Bank
Standard Chartered Grindlays Bank Limited
The Bank of Tokyo-Mitsubishi Limited
The Hong Kong and Shanghai Banking Corporation Limited

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Vision & Mission of FBL

Vision

"To be the bank of first choice with the highest ethical


principles as our guiding force"

Mission

"To excel in providing innovative, value –based banking


solution to meet the changing needs of customers and
future strengthen our image of trust and reliability"

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Introduction of FBL:
Faysal Bank started operations in Pakistan in 1987, first as a branch set-up of Faysal
Islamic Bank of Bahrain and then in 1995 as a locally incorporated Pakistani bank
under the present name of Faysal Bank Limited. On January 1, 2002, Al Faysal
Investment Bank Limited, another group entity in Pakistan, merged into Faysal Bank
Limited which resulted in a larger, stronger and much more versatile institution. In
fact it has the highest share capital amongst private banks in Pakistan and is amongst
the largest in terms of equity.

Faysal Bank Limited is a full service banking institution offering consumer, corporate
and investment banking facilities to its customers. The Bank’s widespread and
growing network of branches in the four provinces of the country and Azad Kashmir,
together with its corporate offices in major cities, provides efficient services in an
effective manner.

The strength and stability of Faysal Bank Limited is evident through the Credit Rating
assigned by JCR-VIS Credit Rating Company Limited of “AA” (Double A) for long
to medium term and “A-1+” (A One Plus) for short term.

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Objectives

• To offer the market banking products and services which are needed,
convenient, marketable and Shariah complaint.
• To grow as an institution with prudent growth and profitability in view.
• To build relationships based on trust and mutual benefit with customers and
shareholders.
• To maintain a highly efficient and motivated employees base.
• To continue being socially conscious organization.

Strategic Planning

• Expanding our channels of distribution


• Delivering banking products and services with efficiency and effectively.
• Introducing technological and procedural efficiencies into all aspects of our
business.
• Striking the right balance between risks and rewards.
• Providing growth and developing opportunities to employees of the bank.

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Our values:

Integrity:
We will hold fast to the highest standards of ethical conduct to meet our commitment
to our customers, employees and shareholders above all, we will hold true to our
personal commitment and conviction to the truth.

Corporate Governance:
Our goal is to respond to a rapidly changing business environment t in a timely
manner, to improve corporate citizenship and transparency by reinforcing our ethical
standards and building a relationship of trust with customers and stakeholders.

Corporate Social Responsibility:


We believe that the highest standards of engagement must not only be with our
stakeholders, employees or customers but also within the community in which we
work and live. We abide by the laws of Pakistan in which we do business, we strive to
be a good corporate citizen and take full responsibility of all our actions.

Responsible Communication:
We commit to creating a dignified workplace based on honest, open and respectfully
communication. We first listen with the intent to understand and then communicate
ideas, results and information forthrightly.

Excellence:
We are committed to the highest level of personal and professional excellence and
operate with a goal of continuous improvement.

Teamwork:
As a team, we play to win from the smallest unit to the enterprise as a whole .We
achieve far more as a team than as individuals.

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Respect:
We appreciate our diversity and believe that respect-for our employees, customers,
stakeholders and all those with whom we interact is an essential element of all
positive and productive business relationship. We treat everyone as we wish to be
treated, with dignity and respect.

Quality Service:
The moment of truth is impact through every employee's interaction. The essence of
quality service is embodied through every interaction that we have, within ourselves
and with our customers.

Awards & Rewards:

• During the year Faysal bank was placed in the top 25 performing companies
by the Karachi Stock Exchange (KSE) for the year 2003. This was a singular
honor, as Faysal bank was the first event scheduled bank to have relevant
this award.
• Also during year the annual report of Faysal 0bank for the year 2003 won
the third prize in "the best Corporate Report" contest in the services sector ,
a competition jointly instituted by the institute if Chartered Accountants of
Pakistan and institute of cost and management accountants of Pakistan.
• The annual report of Faysal bank for 2006 won the first price in the Best
Corporate Rewards organized by a joint committee reviews annual reports of
all listed companies with a view to rewarding the best in terms of quality of
presentation and financial disclosures.
• Faysal bank was also awarded "Certificate of Excellence" in commercial
banking category by Management Association of Pakistan (MAP). MAP
instituted this award in 1982 with the sole aim to recognize and honor
companies showing outstanding performance and demonstrating progressive
& enlightened management practices. This award denotes the excellence of
Bank's Management and its corporate Governance Policies.

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Holding Company of FBL:


Ithmaar Bank B.S.C, an investment Bank listed in Bahrain is the ultimate holding
company of Faysal Bank; DMI group continues to be a major shareholder of Ithmaar
Bank B.S.C with 42% stake.

Subsidiary Company of FBL:


Faysal Bank has one subsidiary Faysal Management Services (Pvt.) Limited (FMSL)
with 60% holding. Till last year Fayzan Manufacturing Modarabe (FMM) managed
by FMSL was also a subsidiary, However on competing its term FMM was liquidated
during the year. All winding up formalities have been completed except for issuance
of winding up certificate by Registrar Modarabe
Due to winding up of Modarabe, FMSL is now expected to launch another venture in
near future. Last year FMSL had earned dividend income of Rs. 56.88 million and
management fee of Rs. 2.7 million from FMM. FMSL declared dividend of Rs. 40.95
million during the year.

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Corporate Information

Board of directors:

H, R.H Prince Mohamed Al Faysal Al Sau Chairman


Zhid H.Rawashdeh Chairman
Khalid S. Trimzey President
Graham Roderick Walker Director
Mohammad A. Rehman Bucheerei Director
Tariq Ibal Khan Director
Sanaullah Qureshi Director
Shahid Ahmed Director

Audit Committee:
Tariq Iqbal Khan Chairman
Graham Roderick Walker Member
Sanaullah Qureshi Member

Southern Region Management:

Ahmed Hemani Regional Head


Masood Jaffri Area Manager
Riaz Ul Hassan Area Manager

Central Region Management:


Bashir A.Shaikh General Manager
Muhammad Idrees Area Manager
Afzal Haq Area manger
Mirza Shauq Hussain Area Manager

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Northern Region Management:

Sharif Khawar Regional Head


Umer Kitchlew Head of Corporate Banking
Syed Mustafa Aftab Shah Area Manager

Head Office Management:


Khalid S. Trimzey
Ahmed Kamran
Taimur Afzal
Mohammad Iqbal
Shahid Waqar Mehmood
Iqbal Ahmed Zuberi
Sohail Nawaz
Arif Hassan Khan
Seemin Shafi
Parwaz Ahmed
Irfaunddin
Irfan A. Khan
Samih Khan
Mustafa Hamdani
Jamil Irshad
Khwaja Jamil Shah
Ali Raza

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Bank's Performance in View of Directors of FBL:


By the grace of GOD, your bank continued to exhibit strong performance in 2007.
Bank's strategy and its execution were aptly tuned to positively respond to the
challenges of the operating environment. The bank made commendable progress to
firmly establish its leadership in the market in all areas including business, operations,
risk management and corporate governance.
On the business front, we continued to outpace the market growth in both deposits and
advances. Deposits increased to PKR 102 billion, 37% against the market growth of
18% (Deposits growth is impressive, though in line with the changing industry trends,
a portion of the incremental deposits pertain to whole-sale price sensitive deposits).
Advances increased to PKR 87 billion, 17% against industry growth of 10%. As credit
off take slowed in response to the restrictive monetary stance of SBP, we focused on
innovation and service delivery to attain growth and increase in our market share. On
the Corporate and investment banking side, we successfully undertook syndicated
transactions worth PKR 91 billion in high growth segment such as physical
infrastructure, steel, Power & services. We also archived targeted growth in SME.
As a part of our strategy, this year we focused on Agri finance. Our approach to this
area is comprehensive covering all faces of Agri financing. The bank has also
launched an impressive print and electronic c media. We continued to expand our
population coverage and have reenergized our services suit through rationalizing, re-
branding (with added features) and introducing products. During the year we
increased our network by 30 modern and customer centric branches and 6 services
center .We also increased our ATM network to 81 by adding another 31 time cash
deposits facility as well. We introduced "Faysal Moavin" checking account, and "FCY
saving plus account". Our current account "Faysal Sahulat" and term deposits "Faysal
Izafa" were also relaunched with added features to become integral part of our
deposits product portfolio.
VISA debit card, and have thus become one of the few banks offering plastic with
international acceptability. Market has given a very positive response to these
initiatives.

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Technology is a key element of our strategy .During the year we successfully


completed migration to SYMBOLS, which commenced in 2005. The bank is in the
final stages of implementation of Oracle Financial. This enhanced technology
platform allows the bank to centralize many processing functions giving cost
efficiency and control effectively. It has also allowed implementation of reliable
Business Continuity and Recovery plans (DRP)
We believe "Service Quality" is the most important competitive edge in our business.
Keeping this in mind, we had declared 2007 as the "Year of Service Excellence". In
this regard : a service enhancement plan was developed and implemented ,a service
manual was developed and disseminated across the staff, complaint management
process was revamped ,24/7 call center was established and frequency of service
monitoring related activities has been increased significantly.

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ORGANIZATIONAL STRUCTURE

FBL is successfully meeting all its objective software programs that are installed for
each department that has increased their efficiency and they can take any information
which is no time from any of their branches/clients are getting quick response due to
their efficient network and staff members.

This branch is very well managed and staff is working devote and work for his/her
personal work they are committed and loyal to their work everyone is ready to
perform other work, if he or she is not there, to prevent customers from suffering the
absence of an employee the other one perform his/her duty with whole heartedly.

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Organizational Structure Of
Rahim Yar Khan Branch

Manager

Agri
Department

Operation
Manager

Locker Advance Accoun Clearin


Cash
s s t g

Bills &
Dispers
Remitt
ement
ances

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Layout of Departments in Rahim Yar Khan Branch

Ground Floor

Operation
Manager Locker &
Cash
Western Union
Department
Department

Accoun
t
Openin
g
Depart Agricul
ment ture
Depart
ment

Stairs
Entrance

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First Floor

Housing Personnel Disperseme Advances H.R & IT


Departme Loan nt Cad Departmen
nt Departmen Departmen t

Auto
Financi
ng
Dep't.

Auto
I.T
Financi
Room
ng
Dep't.

Auto
Financi
ng
Dep't.

Manager's Room Conference


Room

Sta
irs

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Products & Services Of FBL

1) Demand Deposit 4) Fund Based Loan

• Current Account Running Finance


• Saving Account Cash Finance
• Fixed Account Staff Finance
• Call Deposit Receipt Faysal Personal Finance
Agri. Finance
2) Time Deposit

5) Non-Fund Based Loan

• PLS saving Deposit Letter of Credit(LC)


• Faysal Moavin Savings Account Letter of Guarantee(LG)
• Faysal Savings
• Rozana Munafa Plus 6) Miscellaneous Products
• Faysal Izafa Pay Order
• Faysal Mahfooz Sarmaya Deposit Slip
• Faysal Saving Plus
• Faysal Premium
3) Lockers

• Small Size Lockers


• Medium Size Lockers
• Large Size Lockers

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DEPARTMENTS OF FBL

Following are the Departments of FBL:

1) General Banking

a) Account Opening
b) Bills And Remittances
c) Deposit Department
d) Cash Department

2) Credits and Advances Department

3) Agri. Department

4) Western Union & Locker Service Department

5) Housing Department

6) Auto Department

7) Cad Department

8) Dispersement Department

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Account Opening Department:


Account opening is the first step in business of banking to create the relation of public
with bank as a customer. Now customer becomes creditor of bank. It is most
important department of bank and bank officers must take special care before opening
the account.

Account Of General Customers


• Illiterate person account
• Joint Account

Accounts Of Special Customer


• Proprietor Ship Account
• Partnership Accounts
• Limited Company’s Account
• Agent’s Account
• Clubs, Societies /Association Accounts Trusts Local Bodies Etc.

Account opening procedure


The general procedure of all account's opening is same but the document required to
open the account is different according to type of account.
The branch manager is responsible to handle job of account opening but in some
cases, it is assigned to other responsible officers. Information at the time of opening of
account, the bank officer must assure that customer has the following characteristics:
• The customer must have the age of majority, it means he must be the age of 18
according to law.
• The customer must be of sound mind.
• The customer must not be insolvent and bankrupt. .

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Also the bank officer must take proper information from the customer about his
Means, line and place of business.

Account Opening Form (AOF)


The bank officer must assure that the customer fills each and every column of account
opening form correctly with all necessary details. The specific information about the
business or occupation of the customer is recorded in the form. It is preferred that the
customer in the presence of introducer fills account opening form.

Introduction of Accounts
It is a most important column of AOF. Without the proper introduction, the new
account cannot be opened. The bank officer consider following precaution in this
respect.
• The introducer should come with the prospective customer to the bank, so there
will be no doubt about the identity of customer.
• If the introducer does not come then bank officer must take extreme care about
his signature verification.
• The staff member can become introducer if they personally known to the
prospective customer.

National Identity Card


The bank officer check that number of national identity card is correctly recorded in
the AOF and a copy of national identity card is kept in record by the bank.

Specimen Signature Card (SS Card)


The bank officer takes signature of customer on AOF and specimen signature card.

NADRA Verification:
Verification of customer ID card is also necessary from NADRA. NADRA also
provide there software to FBL that they personally take verification in Bank.

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Indemnity Form:
If the customers signature are shaky than he will also sign the indemnity form in
which he mentioned that Bank is not responsible for any obligation about his
signature.

KYC (Know Your Customer) Form:


In this form bank write all information about customer e.g. title of account, Account
number, business detail etc.

Visa Debit Card Application Form:


If customer also wants to gain facility of Debit Card or ATM card than this
application form is also filled by customer. After filling this application by customer
this application is forward to head office, than head office sends the ATM card.

Two Photographs of customer:


With form two photographs of customer is also attach with form if the customer is
illiterate and use thumb impression instead of signature, if the signature are in English
or Urdu than photographs are not required.

Letter of Thanks

A letter of thanks is sent to customer through mail to verify his address. If the address
is not sending his address than bank quickly take action and can close the account.

Individual Accounts

Individual accounts are classified as:


a. Accounts of illiterate ladies and gentlemen
b. Joint Accounts

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Documents required to open individual account are:


a. Account Opening form (AOF)
b. Specimen Signature Card
c. Copy of NIC

Accounts of illiterate ladies and gentlemen:


In case of illiterate ladies and gentlemen, three photographs are required. Two is
pasted on AOF and other is pasted n SS card. Instead of signature, left-hand thumb
impressions are obtained on specimen signature card from gents and right hand thumb
impression from ladies.
At the encashment of Cheque, these customers are advised to attend bank personally
and put their thumb impression on the Cheque. If the cheque is presented through
clearing then it will also only pay to the customer.

Joint Accounts

• The bank will fulfill the stop payment instruction of any cheque lodged by any
member of joint account but removal of these instruction must be signed by all
the member
• If any member dies then there will be no transaction in the account and balance
in the account will be paid according to instruction recorded at the account
opening form.
• The member of joint account can delegate authority to any third party to operate
the account. All the members Sign such mandate but it will be cancelled if any
of the member dies or insolvent.

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Account of Special Customers:


Partnership Firm Account

The documents required for these accounts are:

• Account Opening Form


• SS Card
• Copy of NIC of all Partners
• Copy of registration certificate
• Copy of partnership Deed
The partnership accounts are opened under the following conditions:

• Partnership firms can open only current account due to business concern.
• All partners must sign the account opening form.
• Account is opened with the name of Company
• When them changes are taking place in the firm structure or if the firm is
declared as insolvent then transaction in the account will be stopped. In case of
insolvency, the personal accounts of partner will also become inoperative.

Joint Stock Company Account

Joint Stock companies include:

Private Limited Companies


The companies whose share capital is not offered to the general public instead the
offer is restricted to particular class of society or within the family members called
private limited. These companies are not listed in stock exchange and are not
transferable.

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Public Limited Companies


Promoters and general public contribute the share capital of these companies. These
companies are listed in stock exchange and their shares are transferable and brought
and soled freely in stock exchange.

The document required for these accounts are:

• Account Opening Form


• SS Card
• Up to date Memorandum Article of Association
• Certificate of incorporation.
• Certificate to commence business.
• Resolution of board passed under company seal to open account.
• NIC
• Passport of all the directors authorized signatures.
• List of directors authorized signature

The specific conditions to open the account of Joint Stock Company are:

♦ Introduction is not required for these accounts because companies are legal
entities Death, retirement or dismissal of any director does not effect operation
on the account.
♦ However, death, retirement or dismissal of the directors authorized to operate
upon the accounts temporarily put embargo on operations of the account. In
such cases, fresh resolution authorizing another person to operate upon the
account is to be called for from the company.
♦ The Cheques signed by the directors before their death retirement or dismissal
will be considered as valid instrument.
♦ The operation on the account will be stopped when company terminates its
career.

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Accounts of Clubs & Societies


These are non-trading/non-profit organizations and are formed for the promotion of
culture, education, recreation activities and charitable purpose etc.
Account opening procedure is same as mentioned before.

Title of the Account

Account must be opened in the name of the organization .

The document required for these accounts are:

♦ Copy of Bye-laws/regulations
♦ List of members of managing/Executive committee
♦ Copy of certificate of registration (if registered)
♦ Copies of NICs of the members of executive committee

Issuance of Cheque Book

The customer fills the Requisition slip for issuance of cheque books along with the
AOF. The requisition slip is duly signed then bank officer enters cheque book series
on it. The officers enter the series of cheque book in register in a sequence .The Bank
issue 25, 50, 100 leaves cheque books.
On 25 leaves cheque book charges are 200 Rs.
On 50 leaves cheque book charges are 400 Rs.
On 100 leaves cheque book charges are 800 Rs.
When cheque book issue than bank take signature on cheque book register and also on
requisition form.

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Maintenance of Account:
If amount in account is less than 10000 than 50 Rs. Per month will be deduct as a
maintenance charges

Inactive Account

If there is no transaction in any account within 6 months then account will become
inactive. Now the account will be active only by crediting some amount. Basically
account is deactivating for the verification of customer.

Closing of Account

If the customer wants to close the account then he will fill the closing application form
along with unused cheque book in the bank. The bank will pay remaining balance to
account holder.

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Locker Service Department:


Basically locker shall be rented out to most valued customers of the branch .The terms
and conditions are mentioned on the form which is used for providing the services of
lockers.

Renting Of Lockers:
♦ On grant of the locker to the customer, the relationship between the bank and
the customers is that of Licenser & Licensee, where the bank shall be the
licensor and the customer is the licensee.
♦ Locker may be hired in joint names. However, lockers in joint names shall be
rented only when both or all the customers sign the application form.
♦ All record of the lockers is recorded in the "locker recorded register"

Operation on Lockers:
♦ The access to lockers is allowed during working hours i.e. from 9 am to 5pm.
♦ The signature of the licensee shall be verified from the specimen signature card
or from computer system.
♦ One key of locker is under the custody of Bank and the other key is operated by

customer .The locker cannot be opened unless both keys are not used.
♦ In case of termination of the contract, the licensee will be required to surrender

the original keys of the locker.


♦ Two or more than two persons can also operate the locker.

♦ Account of licensee is necessary in Bank.

Size of Lockers:
Size Height Width Depth
Small 4 1/2" 7" 22"
Medium 4 1/2" 14" 22"
Large 9" 14" 22"

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Charges of Lockers:
♦ In FBL total lockers are 144
♦ Small are 54
♦ Medium are 72
♦ Large are 18
♦ The key charges of all types of lockers either small, medium or large lockers
1500.
♦ Small Locker 1200 Rent /year + 1500 key charges
♦ Medium Locker 1700 rent/year +1500 key charges
♦ Large Locker 3500 rent/year +1500 key charges

Insurance of Lockers:
♦ Insurance of Small Lockers 500000 Rs.
♦ Insurance of Medium Lockers 800000 Rs.
♦ Insurance of Large Lockers 1000000 Rs.

It is necessary for a customer that never put things whose worth in aggregate is more
than the insurance of locker

Lost Of Keys:
Of the keys are lost than its charges are 4500/locker small, medium or large locker.
Actual charges of keys are 1500 but if the keys are lost than locker is repaired and
new keys are used.

If the Owner is dying:


If the person who operates locker is die than its relatives consult the court and locker
is broken under the custody of court, than all things which are found in lockers are
sold and the amount is divided in relatives.
If the person is mentioned the name in his life that who will operate the locker after
his death "Power Of Attorney" than that person will be the owner of that locker.

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Why Break the Locker:


When Bank come to know that in locker there can be illegal or dangerous things than
Bank can break the locker.
If the customer not pay all its dues or rent of locker than locker can also break. Before
breaking the locker Bank send three notifications with the gap of one week to
customer about his dues and finally add is published in any well known newspaper if
the customer not pay his dues than locker is broken.
Locker is broken under the custody of three Bank Officers and make list of all things
which are founded in locker and officers signature the list.

Repairment of Lockers:
Bank has contract with Abdullah & Sons Company for repairing of lockers .They
charge 4500 per locker Repairment. Company is situated in Gujran wala. Locker is
repair every time when customer terminates the locker.

Termination of Locker:
When customers want to terminate the locker than both keys are broken and lock is
also broken and locker is again repair for the new customer.

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Western Union Department:


Basically Western union department provide service for receiving of money from
different countries. Through western union you can only receive money but cannot
send the money to other country .The main advantage of western union is that it is not
necessary that the person who is going to receiving money has account in bank .He
can receive money without account because the money is not transfer in account .The
customer directly receive the money from bank. Mostly the amounts are in the form of
PKR, Dollar Euro and in Pond.

Charges:
On 15000 100 Rs.
Above 15000 400 Rs

Advantage:
The main advantage of western union is that account is not necessary of the person
who is going to receiving money.

Disadvantage:
The disadvantage of western union is that the money which is received through
western union is never recorded in bank so; this money is not accepted in legal affairs.
Because this money has no proof that from where it is earned so, it is not accepted.
Through western union you can only receive money but you cannot send the money to
any other country.

Alternative:
To overcome the disadvantage of western union, FBL provide the facility of Bank to
Bank transferring of money. The money is transfer from FBL to foreign bank. The
charges are 15$ per transaction.
The money is transfer through NOSTRO bank.

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Documents required for western union:


♦ Western union form
♦ CNIC copy

Process of western union:


The person who is going to transfer money he had swift code which is issued by the
foreign bank from where he is going to transfer money. The person already mentions
the name to whom he transfers the money. When he transfers the money in FBL then
that person came with its ID card and after verification he can receive money.

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Cash Department:
Cash department is the most important because it is point of contact between the bank
and the customer. The FBL provides efficient and personalized services to their
customer. This department creates the impression of bank commitment of
professionalism in its system and procedure. So the staff of cash department is well
equipped and trained not only in technical handing of cash but also in the art of
customer.

Functions of Cash Department

It includes:
♦ Receiving cash from the customer.
♦ Making payment to the customers against their Cheques or other payment
instruments.
♦ Handling cash withdrawal and deposit into the bank account with state bank of
Pakistan and with other branches of bank.
♦ Ensuring proper storage safety and security of he cash in cash.
♦ Ensuring proper cash management and sorting out of issue able cash.
♦ Maintaining daily cash position in SYMBOL system.
♦ Transfer of Cheques from one account to another.

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Cash department has two counters,

♦ Cash Receipt Counter


♦ Cash Payment Counter

Cash Receipt Counter


If the customer wants to deposit in his account then he fills the deposits slip. In
deposit slip, the customer writes his account title, account no, the amount in figures &
words, particulars mention the mode of deposit either cash or cheque and sign it. The
customer makes the payment to cashier along with the deposit slip.
The cashier checks the details of deposit slip and The officer credits the customer
account with the same amount and sign on the deposits slip .But if deposits is in form
of Cheques then he makes a deposit slip of the same amount which is written on
cheque and also write the name of branch ,bank name and cheque no.. He posts the
transfer stamp and sign on deposit slip and cheque is transfer in customer account.
Finally customer copy is returned to customer as receipt.
This department of bank deals in operation, relating to cash A/C. i.e. cash receipt, cash
deposit, sale and purchase of prize bond.

Cash Payment Counter


When the customer present the cheque to withdraw the money the cashier check its
date, amount in figure, signature and either it is f FBL ,RYK branch or any other
branch or it is of RYK branch of other bank. If it is of FBL, RYK branch with right
date then cashier enter into cash payment book and transfer to the officer. The officer
feed the account number to check that demanded amount is available in his account. If
amount is available then he verifies his signature from SS card already feed in
computer.

The officer passes the cheque and debits the customer account with the same amount
and posts the stamp of transfer on it. Then cashier makes the payment to the customer
and writes the detail of notes at the back of cheque to maintain daily cash position.

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The cheque can be returned to the customer due to following reason:


♦ If the cheque is post dated; i.e. some future date is written on it.
♦ If the date is of 6 months back.
♦ If the amount in figure and words is different.
♦ If any cutting is made on the cheque.
♦ If the cheque is of other branch of FBL then it will send to bill department. And
if the cheque is of RYK branch of other bank then it will send to clearing
department.

If one account holder wants to transfer some amount from one account to another,
then he will give the cheque favoring the other account holder and also fill the deposit
slip. The cashier after checking the details and enter in the register transfer to the
officer. The officer transfers the mentioned amount from one account to another.

Bills & Remittance Department

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Remittance department plays an important role in transfer of funds from one place to
another. Faysal bank provides this service to their customer, as will as general clients.
Different instruments are use to remit the money.

The following different instruments are used to remit the funds in FBL.
♦ Demand Draft
♦ Pay Order
♦ Call Deposit Receipt

Demand Draft:
Demand draft is used to transfer amount from one city to other city where there is no
branch of FBL than demand draft is used. When there is no branch of FBL than in that
city there will be another bank which provides agency services to that bank. Habib
bank provides agency service to FBL e.g. in khanpur there is no branch of FBL than
DD will pay to Habib bank. But now a day FBL not issue demand draft.

Pay Order
Pay order is issued for payment in the same city because it is issued form one branch
can only be payable form the same branch.. Through pay order customer can transfer
money from one branch to another branch. FBL charge no 75 Rs. Per pay order. In
starting of Faysal Bank pay order is only payable in that branch from where it is
issued but now a day it is pay able in any branch of FBL in Pakistan.

Difference between Pay order & DD:


The main difference between DD and Pay order is that pay order is payable with in
city and DD is payable outside the city. Pay order is payable in only that branch from
where it is issued while DD is payable in any branch of FBL.

Call Deposit Receipt (CDR):


It is also called pay slip and it is used for security purpose. If any person makes
contract with Govt. for a specific purpose e.g. for construction of roads than he makes

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CDR. Bank Dr the account of client and Cr the CDR if road is damage before time.
But if road is not damage till contract than bank refund the money.

Clearing Department:

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All the cheque and negotiable instrument, which are drawn or received from other
bank, are processed and subsequently settle by the clearing department.
For a bank, following are the requirements of being a member of clearing house:
♦ It must be scheduled bank i.e. it is registered
♦ It must have account with State Bank of Pakistan
♦ Sufficient balance should be in his account
Normally clearing is carried out in SBP, but in the city where there is no branch of
SBP than National Bank work as subsidiary of SBP.
Types of Clearing:
There are two types of clearing
♦ Inward Clearing
♦ Outward Clearing
In inward clearing the Cheques of other banks comes in Faysal Bank while in outward
clearing the Cheques of Faysal Bank goes to other banks. All clearing is carried out in
NBP in Rahim Yar Khan.

Process of Clearing:
At 10 am authorized representatives of all the banks of the city get together in SBP or
NBP for 1st clearing, where exchange of Cheques take place, here 1st clearing ends.
Representative of FBL takes the FBL cheques these cheques are entered in the inward
clearing register and than delivered to respective branches of FBL. And the cheques of
other banks are gives to other banks. At 4 pm all the representatives again get
together and exchange of cheques take place. There is no physically or receipt of cash
takes place, actually every clearing house agent has account with SBP which is
debited or credited.

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Credit Department:
Credit department is one of the most important departments of the bank. Assets are
resources of any organization and “Advances” are most valuable asset of the bank.
Credit department takes money from depositors at certain rates and utilizes these
funds by extending loans at specified rate to the creditors. The difference between
these two rates is the profit of bank. So it is major source of profit. The credit
decisions are carefully analyzed because advances create risks for the bank.
When the requested amount exceeds the credit limit of level then case is sent to upper
level. All the loans sanctioned at branch level must be approved by area office.

Functions of Credit Department


Credit department performs two basic functions:
1. Credit Administration

2. Credit Appraisal

Credit Policies of FBL


♦ Follow the Prudential regulations and other SBP directions.
♦ Follow the principles of good lending.
♦ Avoid concentration of credit in one particular sector.
♦ Concentrate mainly on short-term self-liquidating advances e.g. export bills
advances of maturity of one year.
♦ Encourage trade financing.
♦ Monitor credit on a regular and on going basis.
♦ Review credit facilities at least once every year.
♦ Advances not to exceed 70%.
♦ 30% will be margin

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Principles of Good Lending
Before the issuing of any loan, five principles of good lending must be
considered.

♦ Safety
♦ Suitability
♦ Liquidity
♦ Disposal
♦ Remuneration

Safety
The bank can reduce the risk by this principle. Always extend the loans against pledge
of liquidity security and only those persons that have ability to repay

Suitability
Always extend loans to most suitable sector and growing industries and business.

Liquidity
It is the most important principle. Collection of credit is most crucial so bank always
pledge those securities, which are most liquid and can be en-cashed within one
accounting period. And earnings are available to repay the credit.

Disposal
After portfolio analysis, loans should be extended to different sector and not to one
sector to maintain balance growth of economy.

Remuneration
Lending must be generating profit; that is ultimate goal of lending.

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Risk Analysis
The high risk gives the high return. Bank analyzes their risk on advances by applying the five C’s.
♦ Character
♦ Capacity
♦ Cash
♦ Collateral
♦ Condition

Character
The moral and social character of individual is analyzed. The individual should not be
involved in any illegal and unethical business. Past payment history is analyzed that
should always pay his obligation in time.

Capacity
Credit officer analyzes the capacity of borrower to take loan and ability to repay the
requested credit. The credit officer decides by the calculation of liquidity of company
and debt ratio.

Cash
Cash is considered to analyze the ability of repayment. These must be regular and
proper cash flows because they provide liquidity to refund the loan.

Collateral
Bank always secures their loans with collateral. Collateral is security that applicant
provide against the loan. It is important because it builds stake of creditor and if the
applicant defaults then bank will adjust his loan and mark up by it.

Condition
Different conditions are considered by the bank to minimize the risk. These conditions
relate to industry and country economic condition.

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Mark Up on the Loan

Rate of mark up depends upon three elements:

♦ Volume of loan
♦ Time period
♦ Liquidity

So the rate of mark up is varied in every case. Mark up is calculated at daily basis but
it is charged at the end of the month. When the customer pay mark up then credit
officer debit the customer account and credit to bank income.
Types of Loans:

Faysal Bank provides two types of loan that are:


1. Fund Based Loan
2. Non Fund Based Loan
Fund Based Loan
In this type of finance, bank actually deploys its funds and mark up is charged on it.
ACBL provide the following types of fund-based loan

Running Finance
It is also called “over draft” because bank provides an extra credit limit to customer.
Running finance is a secured loan because bank provides extra credit limit against
some security. The customer can avail this credit limit at any time of the maturity
time period; which is normally one year. But if the conduct of customer is satisfactory
and customer can avail this facility to the extended period, then this limit is roll over
to next year.
The cheque book is issued and customer is flexible to draw with in the drawing
power. The customer is allowed to withdraw the defined extra credit limit or a portion
of it. The customer has free will to debit or credit his account again and again up to
specified time period of maturity, so it is called running finance. Rate of mark up
varies in every case. Mark up is calculated at daily basis.

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Cash Finance
Cash finance is like a running finance but it is extended against the pledged security
like inventory, stock or land and 30% cash margin is also charged. The pledged stock
is also insured from any insurance company and the customer also pays all the
insurance and any other security expenses. If customer wants to draw stock then he
will deposit amount equal to the stock and bank will issue delivery order in favor of
customer.

Term Finance
In the finance, replacement schedule of loan is mentioned along with loan amount,
time period and mark up rate. Term finance has minimum time period 7 days to 5
year. Mark up rate varies according to nature of offered security and time period but
now a day it exists between 10% to 15 % . Replacement schedule contains monthly
installment in which amount of markup and principle is mentioned after deduction of
all taxes etc (Saving account, Faysal Moavin) and also on yearly basis (Faysal Izafa).
This type of finance is profitable for the bank because it generates regular income for
bank. It is also profitable for customers for customers because of high interest.

If the customers want to withdraw money than .5% plenty is charged on the principle
amount which is remaining in fixed deposit account.

Staff Finance
This facility is provided for the staff of FBL. The purpose is welfare of the employees.
SBP specify the credit limit for the staff of bank. The mark up rate is less than
commercial rate. The term & condition of staff finance are same as of term finance.

Personal Finance:
Personal loan is unsecured for bank because no security is pledged in this situation.
Only take 6 security Cheques. Range is from 1 lack to 5 lack .It is only for salaried
and business persons. This department is much sensitive because recovery of loan is
difficult. The target of this department is 1.5 million if they fulfill this target than
employees get salary + bonus. In personal loan two types of loan are included

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♦ Secured loan
♦ Un-secured loan
The range of unsecured loan is from one lack to 5 lack .In this loan no
security is pledged so unsecured. Mark-up is also high. Mark –up varies
according to situation.
While in secured loan security is necessary and loan limit is above to 5
lacks.

Documents required:

For Salaried Person:


♦ Applicant's CNIC Copy
♦ One photograph Fresh
♦ Two References CNIC Copy
♦ Current Deposit slip
♦ One year bank statement
♦ Two utility bills
♦ CIB (Credit Information Burro)

For Business Person:


♦ CNIC Copy
♦ One Photograph Fresh
♦ Two reference CNIC Copy
♦ Two Letter head
♦ Business Proof
♦ One year Bank statement
♦ Two Utility Bills
♦ CIB(Credit Information Burro)

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Non Fund Based Finance


In this finance, no cash is involved. It is only a commitment. It is an obligation of
bank and if the customer declares default then bank is liable to make payment. The
bank charges commission in these finances in respect of markup. This facility is
provided against the cash margin and mortgage of property because bank has risk in
this type of finances.

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Housing Finance Department


Faysal Housing Finance gives you so much more than great financing rates - Whether
you want to build a new home or are in a hurry to move into a ready built house or
Just want to renovate your existing home or even transfer your existing expensive
mortgage finance balance. Faysal bank offer the following housing finance facility
♦ Buy a Home
♦ Build a House
♦ Home Renovation
♦ Balance Transfer Facility

Features:
♦ Flexible repayment options
♦ Option to partially or fully terminate the facility.
♦ Financing tenor up to 20 years
♦ Fast processing.
♦ Minimum processing charges
♦ Financing available up to 80% of the market value of the property.

Eligibility:
♦ A Pakistani Resident and National holding the New Computerized Identity
Card (NADRA)
♦ Aged between 25 to 60 years if you are a salaried person and of 65 years if
you are in business
♦ In continuous employment for 3 years
♦ In business with at least 3 years of business or professional experience
♦ Earning a net monthly income of Rs.30, 000/- or more [spouse’s income can
also be combined with yours].

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In housing finance security which is pledged should never commercial property. If the
limit is less than 4 million than only FBL will involve in financing but if limit increase
than 4 million than Regional office also involve in processing of finance.
The range of financing is from 1 million to 25 million, only one million approval is
taking without hesitation but if limit is more than 1 million than Regional office will
round-off the limit.
Debt burden from stat bank is 50% but stat bank also gives permission of 40% debt
burden but in this situation 10% deviations will also take.
In housing finance bank always take two values
♦ Net value
♦ For sale value
But if the limit is less than 4 million than only one value taking by bank that is Net
value but if the limit is more than 4 million than two values will be taking by bank.
These valuations are taking by private companies which are made for valuation
purpose. When FBL wants to take valuation than Head office will tell that which
company will take value of property.
Following Companies are used for valuation purpose:
♦ ASREM
♦ EPI
♦ ICIL
♦ Haseeb Association
♦ Sama association
Insurance of housing finance is very low, only one Rs. Behind 1000 Rs.
Only Buy a home is unsecured for bank because no property is pledged in this
situation. For example if a customer wants to buy a home and he is a salaried person
and have no thing as a security than this type of finance totally based on trust.

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Auto Department:
Faysal Car Finance is the most flexible product designed to meet customer needs.

Features:
♦ Car financing for locally manufactured new and used cars and imported cars.
♦ Car Financing up to five years
♦ Down payment only 20% of the car value
♦ Minimum documentation charges.
♦ Fast processing.
♦ Option to prematurely terminate the facility.

Eligibility:
Now you can swiftly, easily and cost effectively own a car if you are:

♦ A Pakistani National holding the New Computerized Identity Card


(NADRA)
♦ Minimum 20 years of age at the time of financing.
♦ A Businessman or Self-Employed with a minimum of one year experience
in the same business and profession.
♦ A Salaried person with at least two years employment history.

Limitations:
Faysal bank not lease cars to judges, lawyers, army, police .

Mostly prefer the salaried persons rather than landlord.

Insurance Company ADAM G and EFU


Insurance 5%
Lease term 3, 4 and 5 years
Internal rate of return 18.5%
Down payment 20% of asset value
Soft ware use Symbol and Lims
Debt burden should less than 33%

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FBL gives car on financing and also on leasing .In financing the ownership is of
customer while in leasing the ownership is of bank and after all payments of
installment and markup the ownership is transfer to customer.

Mark-up
FBL charge 18.5% mark up on auto financing, from 18.5% the 10.3% given to SBP
and remaining is the profit of FBL. But for contractor employees the mark up rate is
16% while for permanent employees the mark up is less than the actual mark up. Now
a days the KAIBR rate is 10.3% while few months before it was 15.49%.It is changed
after 3 months ,6 months etc but for banks it is always less good because in this
situation the profit of bank is high.

Insurance:
Faysal Bank charge 5% insurance from customer, from 5% insurance companies
charge 3.5% while 1.5% is the benefit of Faysal bank. Faysal bank use ADAM G
and EFU Companies for insurance.
Down Payment:
Down payment should at least 20% of the value of asset or car. The down payment
can be 15% but in this situation special approval is necessary from manager and
from regional office.

Process of car financing:


Faysal bank provide auto financing facility to
• Business person
• Salary person
• Agri. person
But bank mostly prefer the business and salaried persons rather than Agri. Persons.
The documents charge different to different customers. Following documents are
necessary for all types of customers

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1st Step:

Documents from customer:


• 2 photographs
• Photocopy of NIC
• Photocopy of NIC of two references
• Photocopy of utility bills
• Bank statement of one year verified by bank official
• Business proof / Salary slip
But if the customer is landlord than also required the photocopy of land
documents.

Application Form:
Application form is also filled by customer, in application form bank write all
detail of car or auto which the customer required. For example color, model, with
tracker or with out tracker etc.

Tracker:
Tracker is used to find out the car that car is at which place. Tracker insurance is
4.5% from Tracker Company but Faysal bank charge 5%, its mean .5% is the
profit of bank.

Bank statement:
It is necessary for customer that to submit bank statement to bank. Bank statement
provides information about the income of customer. The income of customer
should 50000 Rs. Per month or the income should 3 times greater than installment.
It is used to check that either customer in future can pay the principle and markup
or not. If the customer pays late than 100 Rs. Per day is plenty to customer.

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Documents from Bank:


Some documents are also required from bank for the approval of leasing of car. The
documents are following

CIB (credit information burro) report:


It is issued by stat bank of Pakistan to cheque the reliability of customer. It is issued
on the request of Faysal bank. In CIB report history of credit is mentioned that
customer either pay its previous loans or not. Also mentioned that from which bank
takes loan and how much etc.

Data Check:
In it also mentioned the detail of loan history. For example fro which type of loan he
is applied and how much, and if he applied than he take advantage of it or not.

Address Verification:
Address is also verified by bank from ASREM Company; Address of references is
also verified. ASREM take charges of 2000 Rs. Bank personally cannot verify the
address; it is mentioned by the head office or regional office that from which company
take verification. In every case different companies are used for verification but
mostly ASREM is used for this purpose.

NTN (National Tax Certificate):


This document is used to check that either customer pay tax or not, If the customer not
pay tax than the bank hesitate to leasing o financing of autos.

Application Profile:
On application form complete information about applicant is mentioned.

2nd Step:

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After completing all documents which is charged from bank and customer, the file is
firstly approved by BCC (Branch Credit Committee). After approval of BCC than file
send to regional office which is in Multan, in starting the regional office was in
Lahore but now in Multan. After the approval of regional office the file send to Head
office.
3rd Step:
When file is approved from head office than they disperses to Faysal bank. In Faysal
bank the file is gives to credit department who checks the file, if file is complete from
every aspect than credit department put stamp of approval and loan number is issued
to customer. After issuing loan number the customer can lease the car.

Before leasing the car bank firstly take signature from customer on "Customer
Agreement" in which write all term and conditions are mentioned about usage of auto,
For example if customer gives auto to another person without informing the bank than
Toyota
Altis Automatic 1.8 PETROL 1,445,000
Altis Manual 1.8 PETROL 1,355,000
Camry 2006 Automatic Transmission 3,099,000
Corolla 2.0D SE 1,235,000
Corolla 2.OD 1,114,000
Corolla 2.OD Saloon 1,405,000
Corolla GLI 1,040,000
Corolla XLI 950,000
Hilux S/C 210,000
Hilux S/C D/Spec 2,700,000

bank can take back the car and plenty will be 75000 Rs. on customer .After paying the
amount customer can get the car. Car financing is secured for bank while unsecured
for customer.

Prices of Different Cars:

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Agri .Department:
Faysal Bank offers specialized products for the agricultural sector. Its branches
located in agricultural areas of Pakistan are all equipped to help the local farmers
improve their yield and methods of farming by offering timely and affordable modes
of financing to suit their needs.
Faysal Bank provide two types of Agri. Loan
• Developing loan
• Production loan

Developing loan:
Developing loan is for long term for the purpose of development of land, for example
loan for tractors, treasures and machinery use in land for the purpose of development
of land. Developing loan further classified into
• Form Loan
• Non- Form loan
Form loan is for forms for example tractor and machines use in fields. While Non-
form loan is for dairy, poultry form, fishing, and shading and for buying animals.

Production Loan:
Production loan is issued for the inputs of fields. For example for seeds, fertilizers and
labors etc. It also has two types
• Form Loan
• Non- Form Loan
Form loan is used fro the inputs used in fields for example seeds, fertilizers, water
expenses etc .While Non-form loan is used for the feed of animals for example Oil
cakes ,green food etc

Mark-up
Mark-up is 18.5%, 14.5% is charged by KIBER and remaining 4% is charged by FBL.
The 4% markup can be changed by FBL according to its requirements but KIBER
markup remains same for all banks.

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Security:
As a security bank accept the land, gold, heavy and valuable machinery and tractor etc

Down payment:
• The down payment of tube well is 10%
• For Dairy and Poultry form is 20%
• For seeds, fertilizers etc is no down payment

Documents required from customer:

Agri. Base book


In this book all detail of land is mentioned and also all detail of cultivated area.

Mutation
In it mentioned that land is either buy by customer or it is transfered from forefathers

Jama Bandi
In this document there is mentioned the area of actual land

Quotation
It is in that situation when loan is for tractors etc. In it customer write that from which
Company he want to purchase tractor and which model etc.

Feasibility Report
If the customer want to open a peltry form than in it mentioned all detail of expanses.

Title Deed
In title deed ownership is mentioned that who is the owner of this land.
After completing all these documents the file is send to Customer Service Officer who
verifies the NIC from NADRA. Than the account of customer is opened.

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Documents Charged from Bank:
Credit proposal
In credit proposal three things are consider by bank
• Recommendations from bank
• Processing from higher officer
• Approval
In recommendations from bank, the bank mentioned all details of proposal that either
customer is applied first time for loan or not.

Repayment Schedule:
Production loan is for short term and the customer pay after one year, while
development loan is from 1 year to 5 year. Markup is paid after six months.

Former Credit assessment Report:


In credit assessment report bank check the debt burden that either customer can its
principle and markup or not. And also mentioned the personal information for
example complete information about land of customer. Information about crops that
which crops are growing, information about irrigation system and total worth of asset
is also find
Total Worth = Total asset – Total Liabilities

Visit Report:
In visit report ACO (Agri Credit Officer) physically visit the land to check that land
physically exists or not.
Guaranty Report:
In it all data and information of guarantor is mentioned

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CIB (credit information burro) report:
It is issued by stat bank of Pakistan to cheque the reliability of customer. It is issued
on the request of Faysal bank. In CIB report history of credit is mentioned that
customer either pay its previous loans or not. Also mentioned that from which bank
takes loan and how much etc.

Facility Letter:
In facility letter all term and conditions are mentioned.

After completing these entire documents the file is send to head office for approval.
ACO check the file and if any document is missing than that document is attach and
file again send for approval, if no obligation is from head office than ACO transfer the
file to Cad department where client number and loan number is issued.
After issuing the loan number the customer can withdraw the money from his account.

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Internet Banking

Faysal bank always provides most modern services to its customers. To provide
information about the structure of bank, its network, about its product & services,
about the bank performance, FBL design an innovative website for its inspiring
relationship on Internet.

FBL website address: www.faysalbank.com.pk

All the branches of FBL are connected through Internet. And customer can
mail to any branch about his inquires and problems. FBL will response to customer
problems and inquires through Internet.

Products & Services of Faysal Bank:

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We are a progressive bank striving to offer innovative products, easy accessibility,
quality service & convenience to our customers. We offer customized financing
solutions with flexible criteria and convenient loan tenures. You can avail car, home
and personal loans through our various branches. We also offer a host of Corporate &
Investment Banking Services to our clients, which include financial and corporate
advisory services, along with a wide array of tools to help them achieve their goals.

Products Services
• Deposit account Pocket Mate Visa Debit Card
• Faysal Saving account Transfer of Funds
• Rozana Munafa account Safe Deposit Lockers
• Basic Banking account Non- stop Banking
• Faysal Moavin
• Faysal Premium
• Faysal Izafa
• Mahfooz Sarmaya
• FCY Saving Plus

Consumer Loans
• Faysal Finance
• Car Finance
• House Finance

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Products of Faysal Bank:


Current account
Basic Banking Account
Faysal Bank has introduced the Basic Banking Account (BBA) to cater the needs of
low income groups having the following features.

Features:
• Account can be opened with Rs. 5000/.
• No requirement for maintaining a minimum balance.
• Free of charge statement of account for customers once a year. In case more
statements are required than standard charges would be applicable.
• Free ATM transactions on Faysal Bank ATM machines. However charges
would apply on non Faysal Bank ATM machines.

Saving Account:
Faysal Savings is specially designed to cater to your hard earned savings.

Features:
• Account can be opened with an initial deposit of Rs. 10,000/.
• No restriction on the number of transactions.
• Profit is calculated on monthly average balance.
• Profit payment on six monthly bases.
• Access to account through on-line banking at all Faysal Bank branches across
Pakistan.

Faysal Moavin Saving Account:


Faysal Moavin is a Savings account made for genuine individual savers like you.
Faysal Moavin offers the perfect combination of savings account matched with the
flexibility of a current account.

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Features:
• No minimum balance requirement.
• No restriction on the number of transactions.
• Profit is calculated on monthly average balance.
• Profit payment on monthly basis.
• Access to account through on-line banking at all Faysal Bank branches across
the country.
• Easy access through cheque book an ATM/Debit card. The ATM/Debit card
can be used at over 2000 ATMs in the country.

Faysal Premium:
Faysal Premium is a savings account specially designed for high value deposits with
attractive profit rates having the following features.

Features:
• Account can be opened with an initial deposit of Rs. 5 million
• Profit is calculated on monthly average balance.
• Profit payment on monthly basis.
• Access to account through on-line banking at all Faysal Bank branches across
Pakistan.

Faysal Sahulat:
Faysal Sahulat is a transactional account specially designed for individuals or business
customers who want instant access to their funds with no restrictions on the number of
transaction.

Features:
• Account can be opened with an initial deposit of Rs. 5,000.
• Unlimited transaction facilities.
• On maintaining an average balance of Rs. 300,000 following additional
facilities are provided.
• Unlimited cash deposit facility
• One small locker and one ATM free.

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• 365 Pay orders, 365 Demand Drafts, 365 cheque leaves per year free.
• Access to account through on-line banking at all Faysal Bank branches across
Pakistan.

Rozana Munafa Plus:


To provide the best possible returns for individual, corporate and business customers,
the Rozana Munafa plus Account offers you the opportunity to earn profit every day
and get your profit every month.

Features:
• Account can be opened with an initial deposit of Rs. 100,000/ for
individuals and Rs. 500,000/ for corporate customers.
• Profit is calculated on monthly average balance.
• Profit payment on monthly basis.
• Access to account through on-line banking at all Faysal Bank branches across
Pakistan.

Faysal Mahfooz Sarmaya:


Faysal Bank endeavors to build and strengthen customer relationships by providing
innovative banking products and services. To provide convenience and value to
customers with foreign currency related needs, Faysal Bank’s Mahfooz Sarmaya
foreign currency account offers attractive features:

Features:
• Account can be opened in three major international currencies: US Dollars,
Pound Sterling and Euro.
• Minimum balance for opening Mahfooz Sarmaya Foreign Currency Account is
1000 units of the currency in which the account is opened.
• Account can be opened in any of the following types:
o Savings Account
o Term Deposit Account
• Current Account
• With Mahfooz Sarmaya Account, you automatically qualify for special rates for
car and home financing.

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FCY Saving Plus:


FCY Saving Plus is a new foreign currency savings account with attractive profit rates
where customers get their profit on a monthly basis.

Features:
• Account can be opened in US Dollars, Pound Sterling and Euro currency.
• Minimum balance for opening FCY Saving Plus is 500 units of the currency.
• Profit is calculated on monthly average balance.
• Profit is disbursed on monthly basis.

Term Deposit:
Faysal Izafa:
Every customer’s financial needs are different. As a result, the Faysal Izafa Term
Deposit is designed to provide individuals and corporate customers an opportunity to
grow their money securely and earn attractive profits.

Features:
• Account can be opened with an investment as low as Rs. 25,000/.
• Annual and monthly option available.
• Financing facility of up to 90% of invested amount.
• No annual fee for the ATM/ Debit card for the entire tenure.
• First cheque book on investment of Rs. 300,000/ or more.

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Services of Faysal Bank Ltd:


Combining the wide acceptability of a credit card and the thoughtful prudence of an
ATM card, Faysal Bank PocketMate is the most convenient way to carry cash. No
more fear of overspending. No more searching for the nearest ATM. PocketMate Visa
Debit Card provides you with the freedom of world wide acceptability at over 27
million merchant outlets as an ATM card operative at all ATMs in Pakistan plus at
over 1 Million ATMs worldwide bearing VISA logo.

Debit Card vs. Credit Card:


Better Control on Expenses
PocketMate Visa Debit Card gives customer a much better control over their finances.
In credit cards, there is a risk of spending more than the repayment capacity. There are
no such issues with PocketMate as the amount is directly debited from the bank
account and there are no chances of overspending. All PocketMate transactions are
subject to authorization, which means whenever you do a transaction the status of
your account is checked. Thus you eliminate the risk of spending the money you don't
have you yourself control your account.

No monthly installments
Since with PocketMate you are using your own funds there is no risk of over spending
nor any worries to pay monthly bill on time.

No Minimum Income Requirement


Unlike Credit Cards, the PocketMate is easy to obtain. There is no preset income
requirement to enjoy the benefits of this fast, convenient and safe debit card. All you
need to do is open and maintain an account with any of the branches of Faysal Bank.

Product Features
Worldwide Acceptance
Travel the world and enjoy the freedom of using your PocketMate Visa Debit Card. It
gives you access to over 27 million shops and 1 million Visa ATMs all over the
world, giving you the freedom of payment anywhere in the world.

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Countrywide Acceptance
Your PocketMate Visa Debit Card is accepted at over 40,000 merchant establishments
in Pakistan i.e. restaurants, department stores, grocery stores, petrol pumps, etc.
Besides, you can use it conveniently at more than 2,000 ATMs all over Pakistan.

Maximum Security
The PocketMate Visa Debit Card contains additional security features, it can only be
used ‘Electronically’, which means lesser probability of fraudulent attempts on the
card.

Easy Traveling
Your PocketMate Visa Debit Card saves from carrying cash or writing cheques. It
means customers no longer have to stock up on traveler’s cheques or cash when they
travel.

24-Hour Customer Service


Our 24-Hours Customer Service is there to help you with your requests. Our well-
trained and qualified Customer Service team will assist you in answering your queries,
registering and resolving your complaints, reporting a lost or stolen card and
activating your card.

Lost Card Protection


Card is safer than cash! Feel safe even in the event of losing your card!! All you need
to do is to call our 24-hour Customer Care, and a new card would be issued to you
within a week. You are protected from any financial liability arising from any
purchase transaction made on your lost card after it has been reported lost.

How to Apply
Existing Faysal Bank Debit Card holders have to fill a simple application form to
obtain PocketMate. Existing account holders not possessing any card presently can
also apply for PocketMate by submitting the application form.

To be a part of PocketMate family, one must have a current or saving account at


Faysal Bank.

Delivery of PocketMate

Your PocketMate will be delivered to your branch within 5-7 days of your application
submission.

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Summarized Performance

Faysal Bank
Summarized Balance Sheet of 5 years
Years 2007 2006 2005 2004 2003
Assets:
Cash 6872032 7207998 6696726 5048395 2866278
Balance with other Banks 3708451 2883040 2045887 3564030 648660
Lending to Fin. Institutions 7078102 4608205 10742841 4417378 872132
Investment net of provision 31553108 22525358 23887864 11502805 11218501
Loans and advances 87346401 74468644 62035978 51373254 29626223
Other Assets 2204368 1537764 2371825 1473952 1183315
Operating Fixed Assets 2514959 2239392 2882441 1158407 1030352
Differed Tax Assets _ _ _ _ 160936
Total Assets 141277421 115470401 110663582 78538221 47606397

Liabilities:
Bills Payable 2406927 4516125 1193309 905637 430862
Borrowings from Fin. Institutions 9995855 14965037 15295730 8478048 6529810
Deposits and Other Accounts 102067422 74413641 74595564 56460329 31332172
Sub-ordinated loans 1000000 _ _ _
Liabilities against assets subject to
financial lease 7827 14664 122549 18434 16404
Deffered tax liability 2691466 1839860 1269113 166442 _
Other Liabilities 6951421 5924440 3527023 2294899 1318437
Total Liabilities 125120918 101673767 96003288 68323789 39627685
Net Assets 16156503 13796634 14660294 10214432 7978712
Share Holders Equity
Share Capital 5296445 4237157 3684484 2912635 2647850
Capital Reserve 3567033 3079527 2516211 2259101 2115989
Unappropriated Profit & Reserves 1481668 1815643 1938651 1079492 846016
Total Equity of the Bank 10345146 9132327 8139346 6251228 5609855
Surplus on Revaluation of Assets 5811357 4664307 6520948 3963204 2368857
Total Share Holders Equity 16156503 13796634 14660294 10214432 7978712
Total Liabilities And Equity 141277421 115470401 110663562 78971348 47606397

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Faysal Bank
Vertical Analysis of Balance Sheet
2007 2006 2005 2004 2003
Assets
Cash An Balance With Treasury
Banks 4.86% 6.24% 6.05% 6.39% 6.02%
Balance With Other Banks 2.62% 2.49% 1.84% 4.51% 1.36%
Lending To Financial Institutions 5.01% 3.99% 9.70% 5.59% 1.83%
Investment 22.33% 19.50% 21.58% 14.94% 23.56%
Advances 61.82% 64.49% 56.05% 63.63% 62.23%
Operating Fixed Assets 1.78% 1.93% 2.60% 3.00% 2.48%
Deferred Tax Assets-Net 0.00% 0.00% 0.00% 0.00% 0.33%
Other Assets 1.56% 1.33% 2.14% 1.92% 2.16%
Total Assets 100% 100% 100% 100% 100%
Liabilities
Bill Payable 1.70% 3.91% 1.07% 1.14% 0.90%
Borrowing From Financial
Institutions 7.07% 12.96% 13.82% 10.73% 13.71%
Deposits And Other Accounts 72.11% 64.25% 67.40% 71.49% 65.81%
Sub-Ordinate Loans 0.70% 0.00% 0.00% 0.00% 0.00%
Liabilities Against Assets
Subject To Finance Lease 0.00% 0.01% 0.11% 0.02% 0.03%
Deferred Tax Liabilities-Net 1.90% 1.59% 1.14% 0.21% 0.00%
Other Liabilities 4.92% 5.13% 3.18% 2.90% 2.76%
Total Liabilities 88.43% 87.86% 86.75% 86.51% 83.24%
Share Capital 3.74% 3.66% 3.32% 3.68% 5.56%
Reserves 2.52% 2.66% 2.27% 2.86% 4.44%
Inappropriate Profit 1.06% 1.64% 1.75% 1.36% 1.77%
Minority Interest 0.05% 0.08% 0.00% 0.00% 0.00%
Surplus On Revaluation Of
Assets 4.11% 4.03% 5.55% 5.01% 4.97%
Total Liabilities And Equity 100% 100% 100% 100% 100%

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Faysal Bank Ltd


Horizontal Analysis of Balance sheet
Years 2007 2006 2005 2004 2003
Assets
Cash An Balance With Treasury
Banks 239.75% 251.47% 233.63% 176.13% 100%
Balance With Other Banks 571.71% 444.46% 315.40% 549.44% 100%
Lending To Financial 1231.79
Institutions 811.58% 528.38% % 506.50% 100%
Investment 281.26% 200.78% 212.93% 105.18% 100%
Advances 294.82% 251.36% 209.39% 169.62% 100%
Operating Fixed Assets 212.53% 189.24% 243.59% 200.23% 100%
Deferred Tax Assets-Net 0.00% 0.00% 0.00% 0.00% 100%
Other Assets 213.94% 149.24% 230.19% 147.29% 100%
Total Assets 296.76% 242.55% 232.45% 165.88% 100%
Liabilities
1048.15
Bill Payable 558.62% % 276.95% 210.19% 100%
Borrowing From Financial
Institutions 153.08% 229.18% 234.24% 129.83% 100%
Deposits And Other Accounts 325.15% 236.79% 238.08% 180.19% 100%
Sub-Ordinate Loans
Liabilities Against Assets
Subject To Finance Lease 47.71% 89.39% 747.06% 112.37% 100%
1106.48
Deferred Tax Liabilities-Net 1617.36% % 762.49% 100.00%
Other Liabilities 527.27% 449.37% 267.51% 174.06% 100 %
Total Liabilities 315.26% 256.02% 242.26% 172.41% 100%
Share Capital 200.02% 160.02% 139.15% 110.00% 100%
Reserves 168.57% 145.53% 118.91% 106.76% 100%
Unappropriated Profit 177.89% 224.29% 229.15% 127.59% 100%
Minority Interest 78.12% 100.00%
Surplus On Revaluation Of
Assets 245.32% 196.90% 259.55% 167.30% 100%
Total Liabilities And Equity 296.76% 242.55% 232.45% 165.88% 100%

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Faysal Bank Ltd


Summarized Income Statement Of 5 years
Years 2007 2006 2005 2004 2003

Mark Up / Interest Income 11610781 9728046 6319498 2753451 2074611


Fee, Commission And Brokerage
Income 743913 603667 581854 397064 251189
Divided Income 1221217 1249522 721804 697499 763697
Income After Dealing In Foreign
Currencies 313597 120992 95451 162444 107473
Other Income 43821 447708 -1024 5050 2554
Total Income: 13933329 12149935 7717583 4015508 3199524
Less: Mark Up / Interest
Expenses 7459392 6089255 3309989 1118118 946485
Gross Profit 6473937 6060680 4407594 2897390 2253039
Less: OPERATING EXPENSES
Administrative Expenses 2799747 1866584 1428830 1134672 834754
Provision Against Non Performing
Loans 1797432 517027 -19026 51609 208097
Bad Debts Written Off Directly - 67 1118 141
Other Provisions / Write Offs 6061 - - 1742
Other Charges 9855 32857 2220 1150 11935
Total Operating Expenses 4613095 2416535 1412024 2377098 1056669
Profit Before Tax 2697827 3870340 4018476 2207470 2745272
Less: Tax 425719 1053768 902338 454000 593928
Profit After Tax 2272108 2816572 3116138 1753470 2151344

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Faysal Bank Ltd


Vertical analysis of Income statement
Years 2007 2006 2005 2004 2003
100.00 100.00 100.00 100.00 100.00
Mark Up / Interest Income
Fee, Commission And 6.41 6.21 9.21 14.42 12.11
Brokerage Income
10.52 12.84 11.42 25.33 36.81
Divided Income
Income After Dealing In 2.70 1.24 1.51 5.90 5.18
Foreign Currencies
0.38 4.60 -0.02 0.18 0.12
Other Income
120.00 124.90 122.12 145.84 154.22
Total Income:
Less: Mark Up / Interest 64.25 62.59 52.38 40.61 45.62
Expenses
55.76 62.30 69.75 105.23 108.60
Gross Profit
Less: OPERATING
EXPENSES
24.11 19.19 22.61 41.21 40.24
Administrative Expenses
Provision Against Non 15.48 5.31 -0.30 1.87 10.03
Performing Loans
Bad Debts Written Off 0.00 0.00 0.00 0.04 0.01
Directly
Other Provisions / Write 0.05 0.00 0.00 0.00 0.08
Offs
0.08 0.34 0.04 0.04 0.58
Other Charges
39.73 24.84 22.34 86.33 50.93
Total Operating Expenses
23.24 39.79 63.59 80.17 132.33
Profit Before Tax
3.67 10.83 14.28 16.49 28.63
Less: Tax
19.57 28.95 49.31 63.68 103.70
Profit After Tax

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Faysal Bank Ltd


Horizontal analysis of Income statement
Years 2007 2006 2005 2004 2003
559.66 468.91 304.61 132.72 100
Mark Up / Interest Income
Fee, Commission And 296.16 240.32 231.64 158.07 100
Brokerage Income
159.91 163.61 94.51 91.33 100
Divided Income
Income After Dealing In 291.79 112.58 88.81 151.15 100
Foreign Currencies
1715.78 17529.68 -40.09 197.73 100
Other Income
435.48 379.74 241.21 125.50 100
Total Income:
Less: Mark Up / Interest 788.12 643.35 349.71 118.13 100
Expenses
287.34 269.00 195.63 128.60 100
Gross Profit
Less: OPERATING
EXPENSES
335.40 223.61 171.17 135.93 100
Administrative Expenses
Provision Against Non 863.75 248.45 -9.14 24.80 100
Performing Loans
Bad Debts Written Off 0.00 47.52 0.00 792.91 100
Directly
Other Provisions / Write 347.93 0.00 0.00 0.00 100
Offs
82.57 275.30 18.60 9.64 100
Other Charges
436.57 228.69 133.63 224.96 100
Total Operating Expenses
98.27 140.98 146.38 80.41 100
Profit Before Tax
71.68 177.42 151.93 76.44 100
Less: Tax
105.61 130.92 144.85 81.51 100
Profit After Tax

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Short Term Liquidity Analysis:


Current Ratio
Current ratio =Current Assets/Current liabilities

Year 2003 2004 2005 2006 2007


Current ratio 1.49 1.588 1.48 1.75 2.08

Current Ratio

2.5
2
1.5
Current Ratio
1
0.5
0
2003 2004 2005 2006 2007
Years

Interpretation:
Current ratio is used to assess the short term debt paying ability of the firm. FBL in
starting was not good in paying its short term debt but now in 2007 it is very good in
short term paying ability .Its reason is FBL now have much focus on deposits and
reserves, now they can pay its liabilities immediately.

Quick Acid Test Ratio


Acid-test ratio =Current assets – Inventory/Current liabilities

Year 2003 2004 2005 2006 2007


Quick acid
test ratio 1.35 1.48 1.37 1.75 2.0

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Quick Acid Test Ratio

2.5
2
1.5 Quick Acid Test
1 Ratio
0.5
0
2003 2004 2005 2006 2007
Years

Interpretation:
Acid test ratio is useful in measuring the liquidity position of the firm. It is more
liquid ratio than current ratio. Here the result of current ratio and Acid test ratio is
almost same because the reason is that FBL has no inventory so, the result of both
ratios are same.

Cash Ratio
Cash ratio =Cash Equivalents + Marketable Securities/Current liabilities

Year 2003 2004 2005 2006 2007


Cash Ratio 0.113 0.178 0.121 0.161 0.163

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Cash Ratio

0.2
0.15
0.1 Cash Ratio
0.05
0
2003 2004 2005 2006 2007
Years

Interpretation:
The cash ratio indicates the immediate liquidity of the firm. A high cash ratio
indicates that the firm is not using its cash in a better way. While the cash ratio which
is too low could indicate an immediate problem with paying bills. The cash ratio of
FBL in 2006 and in 2007 is remain stable.

Working Capital
Working capital= Current asset – Current liabilities

Year 2003 2004 2005 2006 2007


Working 7030864
capital(Rs) 15253891 28367022 35327904 47500530 6

Working Capital

80000000
60000000
40000000 Working Capital
20000000
0
2003 2004 2005 2006 2007
Years

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Interpretation:
It is also used to indicate the short term solvency of the business. The higher the ratio
the better the position of company in debt paying. The working capital ratio of FBL is
sharply increases every year from 2003 to 2007 because its liabilities are decreases.

Profitability Analysis Ratio:

Net Profit Margin


Net profit margin = Net profit / Total income

Year 2003 2004 2005 2006 2007

NPM (%)
23.13% 35.70% 35.08% 23.79% 9.15%

Net Profit Margin

40.00%
30.00%
20.00% Net Profit Margin
10.00%
0.00%
2003 2004 2005 2006 2007
years

Interpretation:
This ratio is used to measure the profit return on sales. It is used to measure net
income generated by each rupee of sale. The higher the ratio the better the company in
profitability. The ratio of FBL is going to decrease from 2005 to 2007; this thing
indicates that FBL is not in position in profitability.

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Operating Profit Margin
Operating profit margin =Operating income/ Net sales

Year 2003 2004 2005 2006 2007


Operating
profit
margin 123% 70.35% 52.15% 42.97% 37.70%

Operating Profit Margin

150%

100% Operating Profit


50% Margin

0%
2003 2004 2005 2006 2007
Years

Interpretation:
Operating profit is "pure" because they measure only the profit earned on operations.
The Operating Profit Margin is going to decrease every year from 2003 to 2007
because of increase in expenses, this thing is not better for FBL.

Return on Average Asset


Return on average assets = Net operating income/ Total assets

Year 2003 2004 2005 2006 2007

ROA (%)
5.11% 2.78% 3.25% 2.5% 1.77%

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Return on Assets

6.00%

4.00%
Return on
2.00% Assets

0.00%
2003 2004 2005 2006 2007
year

Interpretation:
It is also called firms return on investment (ROI). It measures the overall effectiveness
of management in generating profit with its available assets. Higher this ration better
is company, but FBL ROA show decreasing trend expect of 2003. This show that FBL
is not in good in profitability.

Return on Equity
Return on equity (ROE) = Net Income/ Average stockholder’s equity

Year 2003 2004 2005 2006 2007

ROE (%)
44.22% 29.57% 42.74% 32.67% 23.33%

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Return on total Equity

60.00%
40.00% Return on total
20.00% Equity

0.00%
2003 2004 2005 2006 2007
Years

Interpretation:

It measures the overall effectiveness of management in generating profit with its


Shareholder’s equity. Shareholders of the bank may be interested in this ratio as to
check the firm’s effectiveness in using the capital provided by them. This ratio
measure both common and preferred shareholders. Higher this ratio, more effective
the firm is .Return on total asset ratio of FBL shows decreasing trend.

Return on Common Equity


Return on common equity = Net income/ Average total asset

Year 2003 2004 2005 2006 2007


Return on
common
equity 44.22% 29.57% 42.74% 32.67% 23.33%

Return on Common Equity

60.00%
40.00% Return on
20.00% Common Equity

0.00%
2003 2004 2005 2006 2007
Years

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Interpretation:
It measures the return only to the common shareholders.
The Return on equity of FBL is decreasing in 2006 and in 2007. Its mean that the
profit by using common equity is decreasing.

Long term Solvency Ratio:


Debt Ratio
Debt Ratio = Total Liabilities/Total Assets

Year 2003 2004 2005 2006 2007


Debt Ratio
(%) 83.24% 86.57% 86.75% 88.05% 88.56%

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Debt Ratio

90.00%
88.00%

debt ratio
86.00%
Debt Ratio
84.00%
82.00%
80.00%
2003 2004 2005 2006 2007
ye a r

Interpretation:
The debt ratio indicates the percentage of assets financed by creditors, and how well
creditors are protected in case of solvency. The lower the ratio the better the company
position in long term liability. Here the debt ratio of FBL is going to increase from
2003 to 2007, so, this thing is not better for FBL.

Debt to Equity Ratio


Debt equity ratio =Total liabilities/Shareholders Equity

Year 2003 2004 2005 2006 2007


Debt to
Equity ratio 706% 117.9% 109% 108.9% 119.6%

D ebt To E quity R atio

800%
600%
debt to equity

D ebt To E quity
400%
R atio
200%
0%
200 32004200520062007
ye a r

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Interpretation:
It also tells that creditors are protected in case of insolvency. The lower the ratio the
better the company's debt position. Debt/Equity Ratio indicate the outsider's portion of
equity. The outsider's proportion in total equity is decreasing each year in previous 5
years but it is still very bad for FBL because its proportion is so high.

Analysis for the Investor:


Earnings per Share
Earning per share (EPS) = Net Income/ Weighted average no of shares outstanding

Year 2003 2004 2005 2006 2007

EPS 8.12 6.02 8.33 6.65 4.29

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EPS(Rs)

10
8
6
EPS(Rs)
4
2
0
2003 2004 2005 2006 2007
Years

Interpretation:
It represents the number of rupee earned on behalf of each outstanding share of
common stock. The graph shows the decreasing trend in 2006 and in 2007 while in
2005 the ratio is high but after that decreases.

Price Earning Ratio


Price earning ratio = Market price of common stock per share/ Earning per share.

Year 2003 2004 2005 2006 2007

P/E (%)
4.43% 7.23% 8.89% 9.10% 15.35%

Price Earning Ratio

20.00%
15.00%
Price Earning
10.00%
Ratio
5.00%
0.00%
2003 2004 2005 2006 2007
Years

Interpretation:

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It measures the amount investors willing to pay for each rupee of the firm’s
earning. It also shows the degree of confidence of investors on firm. Higher this ratio
higher is the investor’s confidence. Here this ratio indicates the increasing trend from
2003 to 2007 and its better for company.

Dividend Payout Ratio


Dividend payout =Dividend per Common share/Diluted earning per share

Year 2003 2004 2005 2006 2007


Dividend
payout ratio 55.42% 74.75% 42.01% 75.19% 58.27%

Dividend Payout Ratio

80.00%
60.00%
Dividend Payout
40.00%
Ratio
20.00%
0.00%
2003 2004 2005 2006 2007
Years

Interpretation:
This ratio indicates that from earnings what percent of it given to outsiders inform of
dividends. Here it shows that from 100 Rs earnings a big portion of it is given to
outsiders. This thing FBL is very attractive for investors.

Dividend Yield
Dividend Yield =Dividend per common share/ Market price per common share

Year 2003 2004 2005 2006 2007


Dividend
yield ratio
(%) 12.50% 10.34% 4.72% 8.26% 3.79%

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Dividend Yield 12.50%

15.00%
10.00% Dividend Yield
5.00% 12.50%

0.00%
2003 2004 2005 2006
Years

Interpretation:
This ratio indicates that from investment how much dividend is generated. The higher
the ratio the better the position of company. Here the ratio has decreasing trend from
2003 to 2007 and it is very disappointed for investors.

Book Value per Share (Rs)


Total stockholder equity –preferred stock equity/ No. of common shares outstanding

Year 2003 2004 2005 2006 2007


Book value
per
share(Rs) 21.19 21.46 22.02 21.55 19.53

Book Value Per Share(Rs)

23
22
21 Book Value Per
20 Share(Rs)
19
18
2003 2004 2005 2006 2007
Years

Interpretation:

It indicates the amount of stockholders equity that relates to each share of outstanding
common stock. It also compare with market price per share. If book value is less than

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market price per share its mean it is overprice share bur if book value is high than
market value per share than it is under price.

SWOT ANALYSIS
Strengths

• FBL has strong background because it is backup by sheikh of Saudi Arabic.


• FBL has much focus on personal marketing for this purpose they send letters to
every client whenever they launch any new product or service.
• The software which is used in FBL is managed in Singapore.
• Its deposits are 48 cruor in Rahim Yar Khan branch , it is on second in R.Y.K
• The bank has established a good branch network within a short span of time.
• FBL has a countrywide network of online branch banking business and ATM’s
in all major cities of the country.
• Bank has well-developed intra-net and inter-net communication network.

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• FBL offer Pocket mate card which is acceptable worldwide at more than 10
lack ATM machines.
• During the year Faysal bank was placed in the top 25 performing companies by
the Karachi Stock Exchange (KSE) for the year 2003.
• The annual report of Faysal bank for 2006 won the first price in the Best
Corporate Rewards

Weaknesses:
The H.R department is not well establish in RYK branch

• There is only one branch in RYK City that’s why there is a heavy burden of
work on the employees.
• Bank has no adequate number of branches as compared to its competitors like
Askari Bank etc.
• To improve the services and to handle the problem of customers, the bank has
no customer complaint department.
• In case of any problem in the online system Bank has no IT qualified employee
in RYK branch.
• The procedure and documentation for loaning is very difficult.
• No job security is there for the employees, and no union exits to secure them.

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• As every person in the bank has his/her own computer in the branch but he or
she are not well equipped with the knowledge of using the computer efficiently.
• Bank has no grievance-handling department for the internal problems of the
employees.
• Due to lack of computer specialist at branch level it has to take assistance from
the head office so in case they waste their lot of time.

Opportunities

• FBL can introduce special schemes of lending for potential small industries.
• Increase the capacity of branch instead of going towards overstaffing.
• Bank has no foreign branches so it should open its branches outside the country
• FBL has applied for a license for separate "Islamic banking branches"
• Barclays' which is an American bank wants to takeover FBL, in this situation
there overall system become international.

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Threats

• SBP levy heavy penalties on bank in case of violating the prudential regulations
especially in case of advances.
• Now the other players of banking are also providing the modern technology
based services like online and Internet banking facility so there is no more
competitive advantage in this area
• The bank stop it's working in case of system failure or in load shading.
• Responding to the SBP's l regulations management takes too much care while
granting loans.
• Because of takeover of Barclays it is a big threat that the top management will
totally change.
• Because the takeover of Barclays new and strike rules and regulations will
impose on employees.

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SUGGESTIONS
• The bank should improve and increase its branch network in Pakistan as well as
in foreign countries.
• Training of the staff should be carried on regular basis in the field of banking
and operating computers.
• Bank should establish a separate marketing department in each branch.
• Although bank has agency relations with the foreign banks but it should open
its foreign branches to compete with the competitors.
• Time period of the loan procedure should be reduced.
• Special awards should be given to hardworking employees to perform extra
• New staff should hire for Agri. Department.
• The Bank should focus on long term debt paying ability
• The management should try to create more understanding between different
departments to increase their productivity
• The top management should create those policies through which they can
protect the Bank if the Barclays takeover it
• There should decentralization decision making

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• The manger should recruits right person for right job
• The manager should hire multi skilled workers to get economy of scale
• The Bank should offer Credit Card to its customers

CONCLUSION

After the completion of my overall analysis and studies of Faysal Bank Ltd
performance and banking system, I come to the conclusion:
Faysal Bank won many awards because of its best performance. It is the second best
Bank Rahim Yar Khan city because of its services and deposits. Currently its deposits
are 49 cruor. The salaries of employees are very attractive as compare to other Banks.
The deposits of Bank are going to increase very sharply in 2007, but there long term
debt paying ability is not good. The software (Symbls) which is used by Bank is
attached with Singapore so, it is international software.
The one big opportunity for Bank is that the in future there are much chances that an
Americans Bank "Barclays" takeover the Faysal Bank. If the Barclays takeover the
Faysal Bank than this thing will be very beneficial for Faysal Bank.
The location and layout of Faysal Bank is up to the mark but it needs more new
technology to compete its competitors (Bank Alfalah).
At the end I can says that the Faysal Bank plays an important role in Rahim Yar Khan
where there is much need of commercial Banks, Faysal Bank plays its role very well
to gain economy of scale.

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Future Out Look


(According to President of Faysal Bank)

Pakistan remains one of the future prospects of our business. This coupled with SBP
initiated conductive regulatory environment has created a host of opportunities going
forward. Foreign investors and reputed global institutions have also expressed their
confidence in the market by making an entry in the country's banking sector .Given
the commitment of its sponsors, infrastructure, technology platform and franchise
value. FBL is very well positioned to capitalize on these opportunities. In 2008 there
focus on prudent growth, cost efficiencies, effective controls, continued investment in
technology & infrastructure.
Our operating plan envisages expansion in branch network by another 24 branches, 4
sub-branches and 5 sales & service centers. We have also applied for license for
dedicated Islamic branches. These initiatives would give us access to bigger customer
segment and will add convenience to our customer's experiences.

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