PREFACE

In order to be able to cope with the changing environment, it is

necessary to some practical experience, as the student of Finance we
have to pass through a series of various managerial techniques. During
this practical course we are provided with an oppor tunity to learn that
how the theoretical knowledge can be implemented in practical
ground. Banking plays an important role in the commercial economic
development of the country.
Now a day’s banks are using different modern technologies, which
influence the managerial activities, that’s why I decided to do my
internship training in the Faysal Bank in the preparation of this report
I had tried my best to provide the all possible information, about the
operations function & the task of FBL, on the brief & com prehensive
form. It also includes a brief department worked during internship. I
have also tied my best to use simple & easy words & languages. Then
internship report ends with some recommendations after identification
of some problems observed during the course of internship.
 Acknowledgement:

In the name of Allah who is most beneficent and merciful, who has
enabled me to do this entailing hard work. It is pleasure and honorable
act for me to write this internship report on Faysal Bank Limi ted
Nawan sahr Multan branch. I am pleased to acknowledge the help
which I received to write this report. I would like to thank Sir Taimur
Arif for giving us the opportunity for doing this internship. This work
helped us to apply the theoretical concepts a nd learn the practical
aspects of a bank. I would also like to thank Sir Muhammad Naveed
Akhtar for her valuable guidance and help throughout this period. I
would like to thank, Unit Head of Faysal Bank, Nawan Sahr Branch
who allowed me to work with their team. I am most humbly thankful
to all the employees of Faysal Bank, Nawan Sahr Branch and
especially to these personalities

Taimur Arif (Head CBSME)

Muhammad Naveed Akhtar (Regional Head CBSME)
 Table of Contents

• Introduction /Background

• Organizational structure / Hierarchy

• Product and Services

• PESTL Analysis

• SWOT Analysis

• Financial Statement Analysis

• Horizontal Analysis

• Vertical Analysis

• Ratio Analysis

• Personal Experience

• Conclusion

• Suggestions & Recommendation

• Bibliography
 History of Faysal bank:

Faysal Bank is a bank based in Pakistan. Faysal Bank Limited (FBL)

was incorporated in Pakistan on October 3, 1994, as a public limited
company under the Companies Ordinance, 1984. Currently, the Bank
shares are listed on Pakistan stock Exchange limited. Bank is engaged
in Corporate, Commercial, Retail and Islamic Banking activities. The
Registered office of bank is located at Faysal house, ST -02, Shahra-e-
Faisal, and Karachi. Based on the financial statement of Bank for th e
year ended December 31, 2016 the Pakistan Credit Rating Agency
Limited (PACRA) and JCR-VIS Credit Rating Company Limited have
determined the Bank’s long-term rating as „AA‟ and short term rating
as „A1 +‟ with “Stable” outlook. FBL‟s footprint now spreads over
more than 355 branches in over 100 cities, with combined business
assets of over PKR 444,465Million, further strengthening its balance
sheet and placing it amongst the top ten banks in Pakistan.
According to the Pakistan credit Rating Agency Limited and th e JCR-
VIS Credit Rating Company Limited, the bank has a long term credit
rating of "AA" and a short term credit rating of "A1+". With assets
exceeding 444,465 billion rupees, it is one of the largest banks in the
country and has shares listed on the Pakist an stock Exchange.
Vision statement
Excellence in all that we do
Mission statement
Achieve leadership in providing financial services in chosen markets through
innovation.
 Values of Faysal bank:-
Integrity:
We are recognized by our reliability, credibility and character.
We believe in ethical, honorable, time -proven principles of
uprightness.
We stand for and abide by honesty, truth and transparency.
Our Integrity: Our Identity.
Respect:

We hold our customers, investors and regulators in high esteem.

We uphold our customer's rights to demand efficient service.
We appreciate and respect our profession and, above all, our bank.
Our Respect: Our Duty.
Teamwork:
We function as a team. Within functions, we cooperate.
Between functions, we collaborate.
Together, we aim for excellence and leadership in our chosen markets.
Our Team: Our Asset.
Professionalism:

We are proficient and efficient in all that we do.

We provide banking services knowledgeably and skillfully.
We uphold regulatory obligations
Our Professionalism: Our Competence
Passion:

We bring zeal and enthusiasm for banking to work.

We are excited to provide customers with the best or the best -suited.
We go the extra mile in legitimate, acceptable ways.
Our Passion: Our Worth.
Responsiveness:

We are receptive to the need for change and improvement.

We are proactive and anticipate our customers‟ needs and wants.
Our Responsiveness: Our Disting uisher.
Innovation

We pioneer novel and more efficient ways to deliver solutions.

We are dedicated to a culture of improvement and modernization.
We stand for originality, in thought, in action and in belief.
Our Innovation: Our Strength.

Compassion

Our concern for our colleagues, our customers, our communities, and
our country sets us apart.
To each other, we are a family.
For each other, we are a meaningful source of shared humanity.
Our Compassion: Our Gift.
 Board of Directors
Mr. Farooq Rahmatullah Chairman of the board

Mr. Ahmed Abdulrahim Mohamed Abdulla Bucheery Vice Chairman

Mr. Mr. Yousaf Hussain President&CEO

Mian Muhammad Younis Director

Mr. Imtiaz Ahmad Pervez Director

Mr. Juma Hasan Ali Abul Director

Mr. Abdullah Ebrahim Mohamed AlQasimi Director

Mr.Abdulla Abdul-Aziz Ali Taleb Director

Board Audit & Corporate Governance Committee

Mian Muhammad Younis Chairman

Mr.Ahmed Abdulrahim Mohammed Abdulla Bucheery Member

Mr. Juma Hasan Ali Abul Member

Board Risk Management Committee

Mr.Imtiaz Ahmad Pervez Chairman

Mr. Abdullah Ebrahim Mohamed AlQasimi

Mr.Abdulla Abdul-Aziz Ali Taleb

Recruitment, Nomination and Remuneration Committee

INF Mr. Ahmed Abdulrahim Mohamed Abdulla Bucheery ORMATION

F, 2015 Mr. Juma Hasan Ali Abul

Mian Muhammad Younis

Mr.Farooq Rahmatullah Khan

CBSME Hierarchy:

Group Head
Retail Banking

Country Head
CBSME

Head
CBSME Central

Regional Head
CBSME

Unit Head
CBSME

Relationship Relationship Relationship

Manager Manager Manager
 Credit Administration Department (CAD)

Credit means belief or trust. “The quality of being credible or

trustworthy”. Another words we can define credit as “trust in one’s
integrity in money matters and one’s ability to meet payment when
due”.
The earning of FBL is chiefly derived from interest charge and
discounts. This department is the revenue generating department.
Credit department basically has three segments.
 Credit marketing department
 Credit administration department
 Trade finance services department
Credit and advance department deals with extending loans (credit
facility) to customers. State Bank of Pakistan (SBP) has prescribed
regulations which are called “PRUDENTIAL REGULATIONS”. Every
bank has to follow these regulations. If any bank violates the
regulations it should be liable for penalties under the core spirit of
SBP PR(S).
The Faysal Bank limited credit is extended on the basis of these rules
and regulations. These regulations describe the term and conditions
under which you can extend loans t o the borrower and to what extent.
 CREDIT FACILITIES

At FBL there are following types of credit facilities

 Corporate and Commercial Products
 Long term exposure
To cater to long term finance requirements of a customer, the
bank offers array of long term facilities. These facilities
typically stretch beyond a period of 12 months. Maximum tenors
for long term exposure are typically 5 years, but can go to a
maximum of 10 years
 TFC / Sukuk
The term finance certificate is debt instrument issued by
corporate entities and financial institutions for the purpose to
raise funds in the form of redeemable capital. These are fixed
tenure capital market instruments classified under fixed income
securities. TFCs can be issued as fixed or floating rate
instrument and may have call or put option.
Sukuk Bonds are widely known as an Islamic or Sharia’h
compliant bonds that are asset -backed Sukuk offers investors
fixed return on their investment. The return on such assets takes
the form of rent, and is evenly spread over the rental period.
Sukuk securities are structured to comply with the Islamic law
and its investments principles, which prohibit the charging, or
paying of interest.
 Short term exposure
Short Term Finance (STF)
The short term loans are facilities having original maturity of
less than one year are used by the businesses to finance their
working capital requirements. These short term loans are
intended to cover seasonal business needs, to finance inventory
and account receivable build up through the operating cycle.

Overdraft / Running Finance (RF)

Running finance is a kind of short term exposure provided to a

customer allowing withdrawals from their current accounts in
excess of credit balance, maintained by them with the bank.

Pledge Financing

The pledge financing facility involves disbursement of funds to

the customers against delivery of goods to the bank. The goods
are held as a security and are placed under the custody of Bank`s
 approved Mucaddum. Pledge finance, while technically straight
forward can become complicated for commodities unknown to
bank.

Supply Chain Finance

Supply chain finance entails providing a finance facility based

on the support of an entity in the supply chain of the obligor (for
example distributor getting access to a finance facility based on
the support of manufacturer)
Commodity Finance
Finance against Packing and Credit (FAPC)
FAPC is taken for the preparation of consignment. It has two forms.
 Pre shipment
 Post shipment
Pre Shipment
Pre-shipment loans are export related working capital financing.
Post Shipment
Post shipment financing is essentially the receivable financing to the
exporters till the period he is out of cash after the shipment.
Finance against Imported Merchandise (FIM)
This facility is allowed against the commodities imported from other
countries usually through letter of credit. Sometime importer does not
have enough amounts for paying the imported merchandise therefore.
He requests to the bank to pay all dues to the ex porter against the
security of imported merchandise. Bank pays the amount and releases
the goods, when the importer pays off its liability partially / fully.

Finance against Trust Receipt (FATR)

Finance is extended upon the trust receipt signed by borrowe r.
Importer has to import the product. There are three conditions.
 Pay money and get thing
 Get fine facility
Trust receipt is given to the bank by the customer. The customer in
turn commits that I will pay on such and such date. Banks pays all
taxes and gets merchandise and then gives it to client. Bank do
charges markup against such financing. FATR is for specific period of
time. If client do not pay with in specified time, then bank charges
higher per day markup.

FE 25 Import Financing

It is import related financing by providing foreign currency loan

(FE25) to settle LC of the customer. In such finance facility loan is
secured by collateral other than the imported merchandise or
documents (such as mortgage and hypothecation of assets etc. Tenor
of this type of financing can vary, but is usually 180 days .
 Trade Facilities
LCs (inland/foreign)

A letter of credit is a document issued by the bank on behalf of

customer, authorizing a beneficiary to draw a draft (or sometimes
without requirement of draft), which will be honored on presentation
by the bank if drawn in accordance with terms and conditions
specified in the letter of credit.
 Sight L/C
 Usance L/C

Sight L/C
In case of L/C-Sight, the underlying draft is drawn at sight and
relevant documents are held by the Bank as security, until the same
are retired by the applicant.

Usance L/C
Usance LCs is typically higher risk facilities and should be offered on
selective basis, as the bank loses control over the goods imported. It
Extends time period (typically 60, 90, 120 days) to importing bank for
payment. After specified time period importer have to pay.

Bank Guarantee
Letter of guarantee “L/G”. Bank gives guarantee in the behalf of
person that I will pay in case of default.
Its main purpose is to stream line the working of CAD to moderate the
chances of losses arising from incomplete security and documents
covering advances.
 Other Credit Facilities

Funded Facilities
Fund based facilities are the conventional credit facilities like c all
lending or certificate of deposits. Investment in TFCs. Besides these
activities, the bank also extends running finance and term finance
facilities to nonbank financial institutions. These are the facilities in
which there is direct involvement of cash fund.

Non-Funded Facilities
Non-fund based facilities are generally extended to financial
institution for trade finance and bank guarantee business.

 Retail Products

Retail products characteristics and risk exposures are determined by

their individual product manual which is amended with time to time in
light of internal market and regulatory factors. These products are
typically term products.

Auto Finance
It is installment based loan extended to individuals as well as
corporate / SME Clients for the purchase of new / used vehicle(s). The
loan tenure for new vehicle is up to 7years, while for used vehicles
total age of vehicle cannot exceed 7 years.

Housing Finance

The Housing finance facility entails financing residential properties in

form of detached or semi-detached or an apartment for individuals.
Housing Finance is available for:
I. Buy a Land plus construction
II. Home Renovation
III. Build a House
IV. Buy a Home
The maximum tenure under this facility is 20 years (usually15
PEST ANALYSIS:

A examine of the outside macro environment in which the firm operate

be able to expressed in the subsequent factors;

1. Political factors

2. Economic factors

3. Social factors
4. Technological factors

Political Factors:

Political factors also remain in the attention during the year. Although
the political situation is liable to remain unstable for a while we
suppose law and order situation is the most significant medium of i ts
power on the economic activity. Political factors might also contain
goods & services which the government desires to give or be provided
(merit goods) & those that the government does not want to be
provided. Privatizing, deregulation and focus on fore ign investment is
the main pillar of economic policies of all the most important party.
70

Economic Factors:

Economy of nation is directly influence on any financial institute.

Economic indicator includes GDP, inflation, balance of payment, debt
of the government. Pakistan’s economy has observer the most
complicated era after posting six successive years of healt hy financial
development. When planning for international marketing this is true
you require seeming at:

 Interest rates.
 The stage of inflation Employment stage per capita.
 Long-term forecast for the economy (GDP) per capita, & so on.

Social Factors:

Social factors similar to values, demographic characteristics such as

age, gender etc. are also disturbing FBL as well as the bank division.
For the reason that of these morals some professional don’t desire to
connect banking section, & some people don’t r emain their funds in
the banks, for the reason is that of religious believes. FBL has
misplaced many clients because of this reason due to move from
Conventional banking to Islamic banking.

Technological Factors:

The bank sustained its strategy of improv ement technology to

assemble up the challenge of up to date banking. With the successful
accomplishment of new central database system bank is in the last
stages of accomplishment of prediction Financials that will give it
important MIS flexibility, easine ss of process & superior interior
controls. As the new technologies introduced Faysal bank implement
those technologies in their operations. On line banking and ATM‟s are
also launched in the Faysal bank. Due to this the Faysal bank grabs the
customers of other banks.

SWOT Analysis

Strengths
 Diversified portfolio of both Islamic and Conventional product
  Established brand name.
 Strong technological based support system
 Growing network of Islamic and conventional branches to cater
to needs of all clients.(75 Islamic branches opened in 2016)
Weaknesses
 Mid Tier Bank in comparison to industry leaders (MCB, UBL)
 Low marketing presence (TVS, Print Media etc) as compared to
other banks.
 Relatively High ratio of non -performing loans as compared to
other banks.
Opportunities
 Conversion from conventional to Islamic banking. The same
would allow bank to target both client types by providing one
window solution
 New product developments can take place.
 FBL can do research and development by the market potentia l
share projection of new products and analysis before launching
in selected sample can enhance success of product

Threats
 Uncertainty in the minds of bank employees/customers during
the conversion phase.
 Already established Islamic Banks in the market. I t will be
difficult for the bank to tap their market share.
 Arrival of new competitor in the market is major threat for FBL
 Credit portfolio expansion in FBL is very slow which could
result in opportunity loss to other competitors
 Moving of key employees to other banks