ACKNOWLEDGMENT

Over and above everything else, I offer my humblest thanks to the ALMIGHTY
ALLAH for bestowing upon me the sense of inquiry and requisite potential for diligence to
successfully accomplish this piece of project. My special praise to the Holy Prophet
Muhammad (Peace be upon him) who is forever a source of guidance for humanity as a
whole.
I wish to express my deepest and heartiest gratitude and profound regard to my
Supervisor Umar Ali Khan Associate Professor for his keen interest, sympathetic help,
valuable suggestions which he extended to me during my internship report.
Lastly, I would like to mention that all this has only been done by the grace of Almighty
Allah and with the support of my very kind and loving parents, who have always been
remembering me in their prayers and encouraging me to be a true Muslim as well as to
achieve excellence in academic education which is the building block of my future life.

I must acknowledge the assistance provided by the staff of the bank, which has
generously allowed me to make use of all books and other material available with them.

TABLE OF CONTENTS

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ACKNOWLEDGMENT............................................................................................................1
EXECUTIVE SUMMARY........................................................................................................4
INTRODUCTION TO THE REPORT......................................................................................5
1.1 BACKGROUND OF THE STUDY.................................................................................5
1.2 PURPOSE OF STUDY....................................................................................................5
1.3 SCOPE OF WORK...........................................................................................................5
1.4 RESEARCH METHODOLOGY.....................................................................................5
1.5 SCHEME OF THE REPORT.............................................................................................
CHAPTER 1.............................................................................................................................7
EVOLUTION OF BANKING...................................................................................................7
1.1 INTRODUCTION............................................................................................................7
1.2 MAJOR FUNCTIONS OF COMMERCIAL BANKS....................................................8
1.3 BANKING IN THE WORLD'S ECONOMY................................................................10
1.4 ROLE OF COMMERCIAL BANKS IN THE ECONOMIC DEVELOPMENT OF
PAKISTAN...........................................................................................................................11
1.5 HISTORICAL BACKGROUND OF UNITED BANK LIMITED................................13
1.6 BOARD of Directors......................................................................................................14
1.7 APPRECIABLE START FOLLOWED BY RECORD PERFORMANCE.................15
1.8 CUSTOMER ORIENTED APPROACH.......................................................................16
1.9 BRANCH EXPANSION STRATEGY.........................................................................18
1.10 STRUCTURE OF UBL................................................................................................20
1.11 HUMAN RESOURCE MANAGEMENT....................................................................22
CHAPTER 2...........................................................................................................................26
WHAT I LERNED AT UBL...................................................................................................26
2.1 DEPOSIT DEPARTMENT............................................................................................26
RULES OF OPENING AN ACCOUNT..............................................................................27
2.2 CASH DEPARTMENT..................................................................................................28
2.3. REMITTANCES DEPARTMENTS.............................................................................29
2.4 ACCOUNTS DEPARTMENT.......................................................................................33

CHAPTER 3...........................................................................................................................34
ANALYSIS

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 3.1 ANALYSIS OF ORGANIZATIONS STRUCTURE.................................................34
3.2 PROBLEMS OF DEPARTMENTS ...................................................................................35
3.3 FINANCIAL ANALYSIS...........................................................................................36
BALANCE SHEET ………………………………………………………………… 43
INCOME STATEMENT ………………………………………………………… 44
SWOT ANALYSIS.............................................................................................................45
STRENGTH......................................................................................................................45
WEAKNESS.....................................................................................................................45
OPPORTUNITIES............................................................................................................46
THREATS.........................................................................................................................46
RECOMMENDATION.........................................................................................................47
REFERENCES ........................................................................................................................51

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 EXECUTIVE SUMMARY

Now a day's strong and efficient capital and financial institutions are the basics
requirements of each and every country. No country can be considered strong, without
having strong capital and financial institutions and markets. One of the components of
these financial institutions is the banks. No one can deny the role, which the banks are
playing, in the economic development of a country.
In Pakistan's banking sector, UBL is one of the leading commercial bank.
Very renowned bankers such as, Chundrigar and Agha Hassan Abidi established UBL,
in 1959. From the very beginning UBL was showing very good performance, but in
1974 after the nationalization of commercial banks, the bank has received some very
severe financial shocks. The shocks received in 1995 were so severe that SBP had to
assume the 'control of the bank, in order to save it from bankruptcy. But after taking
over the management of the UBL, by the new set-up under the leadership of Zubair
Soomro, the bank was successful, in rebuilding its devastated image. The new
management started new schemes and injected new concepts, in order to improve its
services to the clients. Now the bank is in very good financial position and also has gained,
it’s lost Goodwill.
The two months internship in UBL gave a good deal of the practical
experience about the bank, its personnel and various services it offers, to the clients.
Although, two months duration for studying organization by no means is enough, but tried
my best to cover all the areas of the bank in the report.
This report highlights the operations and functions of bank. Banks acts as
agents to their customer; in return they get reward for their services. Banks
play,important role in the development of a society. A strong economy must have a
good banking system.

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 INTRODUCTION TO THE REPORT

1.1 BACKGROUND OF THE STUDY

This study is carried out to familiarize the students with the working of an institution and

the environment of that institution to produce a comprehensive report on it. The study

undertaken is conducted, in United Bank Limited Peshawar City Branch as a financial

institution.

Analysis is done from its financial tool and its operational aspects, while recommendations

are given, to cover those loopholes, which exist in the operations of United Bank.

1.2 PURPOSE OF STUDY

The study has been conducted as a compulsory requirement of BBA (Hons) t hat

institution and to put the theoretical concept into practice. The internship report comprised

of analysis and recommendations, which are the basic purpose of this entire study, as it

enable us to become aware other performance as well as, the various functions of the

organization, which will benefit us in performance of the job later on.

1.3 SCOPE OF WORK

The main focus of internship is on the studying of the overall operations of United Bank

generally. It has been studied and critically analyzed the various operations of United Bank.

Recommendations are suggested, which may be helpful for the management of United

Bank for improving their performance.

1.4 RESEARCH METHODOLOGY

The main purpose of internship at United Bank Ltd was to explain the working and

services of these newly incorporated banks.

The methodology, which adopted to collect data in this research project, based on both

primary as well as secondary sources.

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1.4.1 Primary Source

I Personal observation.

II Briefing with various heads in the Branch

III Interviews and discussion with the staff members:

1.4.2 Secondary Source

I Annual Reports.

II. Half yearly report.

III Manuals.

IV. Circulars and Memorandums..

V. Brochures.

VI. Newspapers.

VII Websites.

VIII. References Books.

1.4.3 Limitations

One-month internship is very limited for a complete observation of an institution.

ii. Most of data is of confidential nature.

iii. Due to the bank busy schedule, complete information was difficult to get.

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 CHAPTER 1
EVOLUTION OF BANKING

2.1 INTRODUCTION
The word bank is derived; from Latin word Bancus or Banque which means, a bench. The

explanation of this origin is attributed to the fact, that the Jews in Lombardy transected the

business of money exchange on benches, in the market place. When the business failed the

people destroy the bench.

Incidentally the word bankrupt is said to have been evolve from practice.

The opponents of this opinion argue that if it was so, then how is it that the Italian

moneychangers were never called Banchierei in the middle Ages.

Other authorities hold the opinion that Bank is derived from, German word Back which

mean, joint stock fund. Later on, when the Germans occupied major Italy of the back resized

into Bank.

2.2 IMPORTANCE OF BANKING

Bank is the essential' constituent of the business. It ensures the prompt and smooth running

of trade network. The better network of banks dots the landscape of modern economy

for the country. Apart from safeguarding people's money, it gives push to all sectors of

economy. The importance of commercial banks can be illustrated by a brief

Explanation of their major functions. A bank is defined as:

"An institution for the collection of funds from the community and credit to its

customers by way of advance against goods or securities or by discounting bills for their

useful purposes ".

An organization, usually a corporation, chartered by a state or federal government,

which does most or all of the following: receives demand deposits and time deposits,

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honors instruments drawn on them, and pays interest on them; discounts notes,

makes loans, and invests in securities; collects checks, drafts, and notes; certifies

depositor's checks; and issues crafts and cashier's checks.The importance of commercial

banks can be illustrated by a brief explanation of their major functions.

2.3 MAJOR FUNCTIONS OF COMMERCIAL BANKS

2.3.1 CREATING MONEY

Commercial banks have the ability to create and to utilize the money. Lending and

investing activities of commercial banks in cooperation with central bank accomplish this. If

bank credits were not available, the expansion of our productive facilities would have been

severely limited.

The increase in supply of money causes inflation and decrease in supply than the rate of

production of goods causes deflation and both have bad effects on the economy. The

purpose of central bank is to provide stable rates and maximum employment, for this

purpose the commercial banks are used as conduit through which money supply is

controlled.

2.3.2 PAYMENT MECHANISM

Providing for payment mechanism or the transfer of, funds is one of the important

functions performed by commercial banks and it is increasingly important as greater reliance

is placed on the use of checks and credit cards.

2.3.3 POOLING OF SAVINGS

Commercial banks provide facilities for pooling of savings and making them available

for economically and socially desirable purposes. The saver is rewarded by the payment

of interest on his saving which are safe and in a highly liquid form. These pooled funds

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are made available to businessmen who may use them for the expansion of their

productive capacity and consumers for such items as housing and consumer goods.

2.3.4 EXTENSION OF CREDIT

The primary function of commercial banks is the extension of credits to worthy

borrowers. In making credit available, commercial banks are rendering a great social

service through their actions, production is increased, capital investments are expanded and

higher standard of living is realized.Bank loans enable the farmers to purchase seeds,

fertilizers and enable the Manufacturer to purchase raw material and machinery

facilitates the employment of labor.And production of goods demanded by the industry,

government and consumers. It also enables government to ruin activities smoothly by

getting temporary Funds by purchasing bonds.

2.3.5 Facilities for Financing of Foreign Trade

Although, foreign trade is basically the same as domestic trade, some differences

necessitate international banking services provided by commercial banks. These

differences arise because of the existence of national monetary system, unfamiliarity with

the financial ability of the buyers and sellers in foreign countries.

The purchaser may encounter a situation where the foreign seller is not willing to place

the goods on ship and wait for payment to arrive in the next mail. The transaction might

he handled more satisfactorily through the issuance of commercial letter of credit (L.C) .

This protects both the purchaser and seller.

2.3.6 UTILIZATION OF RESOURCES

In the new era, It is through the agency of banks that people can make savings and then these

savings automatically now into the channels, which are productive, both or saver and

investor. The banks deposit the people's money, which ensures the economic

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development by mobilizing the financial resources of the community and making them

possible to now in desired channels.

2.3.7 CAPITAL FORMATION

Capital formation results, when some proportion of society's present income is saved and

invested in order to increase materials as well as humane capital.

The importance of capital formation can be seen from the following;

a. It helps in breaking through the vicious circle of poverty.

b. The Capital formation increases the stock of material and humane capital.

c. It increases theinvestment in various sectors of economy.

d. Leads to expansion of both national and international markets.

e. It helps in building import substitution industry.

2.4 BANKING IN THE WORLD'S ECONOMY

The world economy has witnessed in recent years a phenomenal growth in

financialtransactions surpassing that of transactions on goods and services. It has been

estimated that transaction operations on financial assets are ten to fifteen times those goods

and services. Financial flows are likely to continue to grow at a faster pace than output.

Thebanking system happens to be at the center of this increase in financial transaction. It has

a leading role not only in financing products trade but also relatively in new areas such as

financing of project companies and states.

The solidity of the world banking system depends on the solidity and stability of national

economics. Economic growth will naturally have a positive influence on the performance of

banking system. Conversely, recession and inflation would affect this performance

negatively.

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In the 1990s cross-country financial flows became a considerable mainstay of the world

economy. This situation owes much to four major developments;

1. Changes in the regulatory environment. These changes have permitted domestic markets

to compete with international markets.

2.Technological change especially the advances in computer and telecommunication

technologies. It has speeded up theimplementation of transactions, reduced costs and

expansion of international financial market.

3. Financial innovation. This has been motivated by the drive to avoid regulatory constraints.

4. Growth diversity.In financial system it needs greater flexibility or responsiveness to change

need and environment.

2.5 ROLE OF COMMERCIAL BANKS IN THE ECONOMIC DEVELOPMENT OF

PAKISTAN
Banks play an important role in the economic development of a country. The banking system

is unorganized and inefficient; it creates adjustments and impediments in the process of

development. In Pakistan, the banking system is very well organized. The State Bank of

Pakistan established on July 1, 1949 stands at the apex and is RESPONSIBLE for the

operation of the banking system in Pakistan. The other banks, the banking structure in

Pakistan, are playingan active role in the economic development of the country.

The role of commercial banks in the growth and development of sound and healthy

economy of the country is briefly discussed as under;

2.5.1 MOBILIZATION OF SAVINGS

The commercial banks like National Bank of Pakistan, Habib Bank, Allied Bank, United

Bank and Muslim Commercial Banks have opened up branches in urban and rural areas to

mobilize savings of people.

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2.5.2 FINANCING DEVELOPMENT PROJECTS

The banks and other development finance institutions like IDBP, ADBP, PICIC etc

advance short and medium term loans for financing of the development projects both in

the private and public sector and thus help in accelerating the rate of economic

development in the country.

2.5.3 FACILITATING TRADE ACTIVITIES

The credit institutions collect the savings of the people and make them available for

facilitating trade activities, both inside and outside the country.

2.5.5 HELPING SBP IN ACHIEVING MONETARY POLICIES

The Commercial Banks under the supervision and guidance of the State Bank of Pakistan

help in implementing and achieving the objectives of the monetary policy, which vary from

time to time.

2.5.6 ASSISTING IN DEVELOPMENT

The commercial banks arc profit-seeking enterprises. In order to maximize the profits, they

have to maximize the loans. An organized banking system keeps a balance between liquidity

and profitability and thus assists in the planned development of the economy.

2.5.7 PROVISION OF AGENCY SERVICES

The commercial banks provide agency services to the clients. They collect dividends and

pay interest and premium on behalf of the clients. They keep their customer’s valuable in

safe custody. They help in the mobility of capital and thus stimulate capital formation in

the country.

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2.5.8 MAKING CAPITAL AVAILABLE FOR INVESTMENT

The organized banking system helps in directing physical resources into productive

channels. It also keeps a balance between the availability and requirements of the capital in

the country.

2.5.9 LESS RELIANCE ON FOREIGN CAPITAL

A planned banking system by launching a vigorous campaign of mobilizing idle savings in

the country can meet the capital development requirements from within the country. The

country thus has to rely less on foreign capital in financing the development projects.

2.5. 10 PROFIT SHARING SCHEME

The commercial banks receive surplus balances of households in business and pay

interest on the deposits of the clients. The banks have now introduced interest free

banking in Pakistan. The Depositors, instead of having a fixed rate on the deposits, will

share the profit and loss of the banks. The profit and loss sharing (PLS) arrangement,

which is an alternative to interest under Islamic Economic System, is now operating in-

Pakistan.

2.6 HISTORICAL BACKGROUND OF UNITED BANK LIMITED

On July 1 st,1948 State Bank of Pakistan started functioning as central bank of Pakistan. As

there were 198 offices of scheduled banks in the newly born country, State bank of Pakistan

faced urgent task of creating a national banking system. But it was only in 1959 when

greatest banker of all times Mr. Agha Hassan Abedi transformed this idea into reality.

United bank limited was established on 24 thJuly 1959. Its first branch was inaugurated

on November 07, 1959 at Chundrigar roads then known was as Macleod Road. The

authorized capital was Rs. 10,000,000 divided into 1, 000, 00 shares of its, 10/-each.

The 1st board of directors had following members:

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1 Mr. Ismail Ibrahim chundrigar Chairman

2 Mr. Mohammad Shafiq Saigol M.D

3 Mr. Mohammad Rafiq Saigol Director

4 Mr. Mohammad Bashir Saigol Director

5 Mr. A.Razzaq Dada Director

6 Mr. Mian M.Yahya Director

7 Mr. Saeed Saigol Director

8 Mr. Agha Hassan Abedi Director and GM

Mr. Ibrahim Chundrigar died in 1960 and was replaced by Mr. Habih

Rahmatullah. Mr. Shafiq Saigol.Retired in 1962 and Agha Hassan Abedi took charge as

Managing Director. After the nationalization, of all commercial banks in January 1974,

all the 14 units of commercial banks were merged into 5 units. Commerce Bank Limited and

United Bank were merged with UBL.

Mr. Mushtaq Ahmad Khan Yousafi became 1 St president of UBL.

2.7 BOARD OF DIRECTORS

In present time the board of directors and management of UBL is shown below.

His Highness Sheikh Nahayan Mabarak Al Nahayan.

CHAIRMAN

Sir Mohammed Anwar Pervez,

DEPUTY CHAIRMAN

Mr. Atif R. Bokhari

PRESIDENT & CEO

Mr. Omar Ziad Jaafar Al Askari

DIRECTOR

Mr. Zameer Mohammed Choudrey

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DIRECTOR

Mr. Seerat Asghar

Director

Mr Muhammad Sami Saeed

DIRECTOR

Mr. Amin Uddin

DIRECTOR

Mr. Arshad Ahmad Mir

DIRECTOR

Mr. Aqeel Ahmed Nasir

SEVP/Company Secretary & Chief Legal Counsel

Mr. Rayomond Kotwal

Chief Financial Officer

Now the UBI, has been privatized and its 51% shares have purchased by investors i.e. the best

way group UK and Abu Dhabi Consortium electing Sheikhs Nahyati al Muharik as Chairman

of UBL and Sir Anwar Pervez as Vice Chairman, who have retained Mr. Ansar Zahir

Khan as president andCEO of United Bank Limitedin order to continue the policies of

dynamism and therefore, UBL has geared itself to provide the services which the customers in

the modern day banking expect from a bank.

The purpose of the bank for which it was established is to serve the society. It also

requires staff with skills, experience and resources. There have been a lot of changes in its

structure, functions and service which it provides. These changes show the changing

requirements of the economy to meet the needs of changing economy.

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2.8 APPRECIABLE START FOLLOWED BY RECORD PERFORMANCE
The results of the early years of the banks operation showed good start, which was

appreciated by the people. It set record of rapid growth in Pakistan banking history this

happened in short of time.

Instead of intense competition, UBL got good image and substantial market share and also

built relationship in the market. As early as 1997, UBL became the second large bank

in the country.

2.9 CUSTOMER ORIENTED APPROACH

UBL adopted the market-oriented approach, which appealed to the customers. UBL's

dynamic, radical and personalized style of banking is different from the conventional

business patterns of the period. Infact every feature and aspect of the UBL's behavior

reflected and highlighted those differences most significantly, the commitment to serve

Customers.

UBL CORPORATE BANKING

UBL's mission is to serve all corporate needs of its customers and ensure full satisfaction

through product innovation, personalized banking through relationship banking, best

customer service and key contracts.

INVESTMENT BANKING

UBL, provide innovative and unique advice to customers in meeting challenges in an ever changing

market. A healthy mixture of structuring, advisory and project finance businesses deals in

either leading or participating in TFC'S.

UBL TREASURY

This department provides response to customer needs for the next millennium and to provide

treasury services with reorganized dealing room. It interacts with the market and deals with

core treasury products in money market and foreign exchange.

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ENHANCED MANAGERIAL ABILITIES

In Pakistan the concept o f professional management had not yet developed. But UBL was

considered to be the pioneer in this regard in a sense that this bank from the very first day

employed skill and professional management, which had ability to take quick decisions and

flexibility to cope up with changing business and economic conditions.

FLEXIBLE BUSINESS STYLE

UBL business approach was flexible which means that it changed its style according to the

market conditions and was appealing to the customers. UBL's approach was dynamic and

personalized which made it distinguished from other banks of the era. UBL's every

feature and aspect of behavior reflected this flexible approach throughout its banking

practices.

BETTER WORKING CONDITIONS

From the very first UBL has provided its employees a better working environment, salary

structure and facilities. It has created such relaxed environment for its employees in the

presence of whom employees can polish their skills and abilities. This is reflected in the air-

conditioned office branches, modern equipment and furniture and other facilities.

The obligation to give all the employees an equal chance to be succeeded has been one of

the most fundamental and challenging responsibilities of the bank.

INPLUGING IN HEALTHY COMPETITION

When UBL entered in the banking field, a new era of banking began and this era was the

phase of competition banking. Clients were attracted towards those banks which use to

provide better and quicker banking services. Keeping in view this approach UBL made a lot of

changes and adopted a modern strategy to provide attractive services to the customers.

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The competition involved in by UBL wits not only legitimize but also vital for the industry. It

consists of a wide and increasing range of services which were provided speedily, efficiently

and with due courtesy.

INFORMATION AND TECHNOLOGY

UBL took lead in introducing computers in banking operations in Pakistan. The first

computer was installed in 1996 and in 1968 UBL, installed the most modern computers of that

time in the important cities of the country.

UBL also provides cash management services to the financial institutions through its

information and technology centers very successfully.

The introduction of e-mail, creation of bank's own website, global fax service and

recently online banking is the beginning, of new era in the UBL banking services nationally

and globally.

HIGH GROWTH IN ASSETS

UBL has more growth in assets than scheduled bank. Overall, the assets of UBL

increased at an annual rate of 26.49 percent, which compares favorably with growth of

18.66 percent in the assets of all the nationalized commercial banks (NCB's) for the same

period. Now total assets of UBL have increased to Rs. 191, 822 million in 2002 and currently

managing assets of Rs. 29 billion (as of July 10, 2012),

2.10 BRANCH EXPANSION STRATEGY

After the commencement of business, by the end of June, eight branches had been

opened. The management decided to broaden the geographical coverage. Therefore

besides the cities, the bank spread out the branches into small towns and the far-flung less

developed and unbaked area, to fulfill its social responsibility. The branches in the small

towns and villages have been of vital help to the small industrialists and businessmen,

industrial workers, farmers, craftsmen and other persons of limited means the bank had

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extended its network to 916 by end of December 1973. At the present number of branches is

1000 in 2003.

RO LE IN THE FIELD OF SPORTS

UBL considers sports an investment in the long term progress of the society and in

this direction UBL established sports club in 1975, which was later developed into a

full-fledged division to supervise the sports activities. UBL sponsored cricket and

hockeytournaments, i.e. UBL GOLD CUP cricket tournament in 1976 and UBL GOLD

CUP hockey tournament in 1982, 1983, 1984, and 1986. UBL organized all these

tournaments very successfully.

INTERNATIONAL OPERATIONS

UBL took a basic decision to make its present felt internationally and to cater to the needs

of importers and exporters as well as its share in the international market and foreign trade.

OVERSEAS BRANCHES

In 1963 UBL opened its first branch in London UK which is the most important center of the

international finance and trade. The UK operations of UBL were closed during the year 2002

and along with the branches of national bank of Pakistan, a new bank namely Pakistan

international bank has been incorporated in UK with 55% share holding of UBL.In Oman the

share holding in commercial bank of Oman was withdrawn. However an exchange company

namely Oman United Exchange Company, formed in 1983.

GLOBAL APPROACH

The UBL global network with its strategically located overseas branches and affiliates,

covering almost all major financial markets of the world is well positioned to act as a

correspondent bank for Pakistani and foreign banks for processing; and settlements of

various currency transactions, UBL's strategy is to reach customers in various diversified

markets across the globe and in this regard bank is progressing fast in the arena of cross

Page | 19
border ventures with an appetite for commercial and country risks. In order to meet the

International standard of banking UBL is the first Pakistani to shift its international division

from Karachi to Dubai.

SUBSIDIARIES:

At present the UBL and its subsidiaries are:

United Bank Limited Holding Company

Pakistan International Bank Joint Venture

Oman United Exchange Company Joint Venture

United Bank AG-Zurich Subsidiary Company

United Assets Management Co. Ltd. Subsidiary Company

United Executors & Trustees Co. Ltd. Subsidiary Company

United Bank Financial Services (Pvt.) Ltd Subsidiary Company

KEEPING PACE WITH 21STCENTURY

UBL has stepped into the 21 st century with confidence. UBL stood firm to provide the

services, which the customers in the modern day expect front a bank. UBL is planning to

play its dynamic role in the overall development of the country. Now UBL is equipped with

the latest technologies and has professional experience to face the future with determination

and confidence. UBL has high aims and sense of direction in order to serve the country

with zeal, devotion and enthusiasm.

ISLAMIC BANKING DIVISION

After the Supreme Court decision on Riba, UBL undertook groundwork to implement

Islamic banking. A division was created which, in addition to conducting research also

works closely with the commission for transactions of financial system.

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2.11 STRUCTURE OF UBL

As stated before, a Board of Directors consisting of one President, 4 directors from UBL,

one from Pakistan Banking Council, one from Ministry of Finance and an additional one

who is the secretary of the board manages United Bank Limited. Hence the board of

directors is an 8-member team, which manages the overall operations of the bank.

Under the board of directors there is executives committee consisting of 7 members

including the president/chairman and the Secretary of UBL. These members of the

Executive Committee, except Secretary, are in-charge of many divisions. These

members are all Senior Executive Vice Presidents (SEVP). There are 20 divisions, which

have their own heads who arc Senior Executive Vice Presidents (SEVP), Executive Vice

Presidents (SVP) or Senior Vice Presidents (SVP). The SVEP of inter national division

manages the overseas filed operations of the 26 UBL branches located in 10 different

countries.

UBL ORGANIZATIONAL CHART

Chairman

Deputy Chairman

Board of Director

Executive committee

Managing Director

SEVP
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 EVP

VP

Office Grade - I

Page | 22
 2.12 HUMAN RESOURCE MANAGEMENT

Human
Non-clerical staffresources Clerical
are the staff
most importantOfficer
assetsGrade-II
of the organization. Human resource
Officer Grade-III

management is the management of personnel in an organization and is concerned with the

creation of harmonious working relationship among its participants and bringing about their

utmost individual development. HRM not only describes how to manage people, but also

recruits the ways to improve the quantity of services and increase efficiency of the employees.

The importance of HRM department cannot be ignored in any organization. United Bank Ltd

has also separate HRM department, which looks after its personnel requirements & pays

attention to their personal as well as career development.

HUMAN RESOURCE POLICIES

Every organization has its own Human resource policy. The basic fact lying under such

policies is to develop such working conditions and creating employment opportunities, which

could foster a great sense of, unity among employees and protect the common interest of all

parties.

According to UBL personnel policy procedure manual it covers,

 Man Power planning.

 Role of personnel division at the Head office.

 Analysis and Job specification.

 Recruitment & selection.

 Promotion, Transfer, Demotion & Retirement.

 Resignation

 Management by objective, Performance Standard, Assessments and appraisals

 Training Plans & development.

 Salary & Wages.

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  Personnel records and statistics.

 Industrial Relations.

 Compliance management.

 Work conditions.

 Transportation.

 Medical schemes.

 Tax liability.

 Temporary Recruitment.

 Internal communication & staff welfare.

 Delegation of authority & power of attorney.

 Foreign posting international assignments.

RECRUITMENT AND SELECTION

In United Bank Ltd. Employees are recruited by personnel division in accordance with the

bank policy. United Bank Ltd uses two different methods to meet its personnel needs.

Direct Appointments

Promotion

Direct appointments are usually made in upper levels of hierarchy like in the case of

appointing directors & presidents. The employees are also recruited through discrete

selection procedure. The "promotion is an upward movement or advancement of an

employee in an organization to another job. It involves increase in salary grade status

&responsibilities". As there is ban on all fresh appointment, so to meet its personnel

requirements vacant posts in United Bank Ltd. through recruitment on contract basis and

promotion of existing employees.

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TRAINING AND DEVELOPMENT

"Training is a planned program undertaken to enhance employee knowledge, skills, attitude,

and social behavior that will improve the ability to perform the job."

United Bank Ltd. has its training and development centers at all major cities of the country

Various on the job training, off the job training, pre-service training, in service training and

development programs are consistently carried out by the bank, preparing its employees to

meet the challenges of changing competitive environment.

The bank provides six months on job training to newly recruited employees. On completion of

their training they are posted at different branches. United Bank Ltd. also undertakes

workshops and development programs to improve the professional capabilities of its staff

for e.g. one such workshop organized was "managing for high performance focusing on

the objective". However, to manage the change process & encourage teambuilding

"Different field officers development programs are conducted at different training center". The

focus of these courses is on personal development communication &negotiation skill and

customer care.

PERFORMANCE APPRAISALS

The process of evaluating the performance of employees with the objectives of improving

job performance is covered in performance appraisals. The information generated during

appraisal can be used as a basis for measures to improve job satisfaction, career

planning, manpower, planning, training act as a basis for deciding level of pay. Performance

of employees in big organization is evaluated on very scientific & objective basis. This

system should be uniform for all thereby ensuring a trust and confidence, but usually these rules

are not followed.

• Achievements of the desired goals.

• Quality of work produced.

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• The workload handled.

• To work in an effective and efficient manner.

• To achieve the goals through the economic use of limited resources.

Salaries

Almost in every bank the employees are offered an attractive salary. This is one of the

main factors for which an individual is interested to join an organization; pay of

employees should be well enough to at least fulfill basic needs, which should ensure a

decent standard of living. The salary package in United Bank Ltd. was not sufficient to

attract employees but recently the salaries of employees at different hierarchical positions

have been increased.

Page | 26
 CHAPTER 2
WHAT I LERNED AT UBL

Since the beginning of the 20 thcentury, the concept of Departmentation in every field of

business has increased tremendously. It is division of work under various specialized units.

The primary role of a department is to contribute in every possible way to achieve the

organizational objectives through its specialized tasks. Bank being a sensitive organization,

the concept of Departmentation is much important here.

2.1 DEPOSIT DEPARTMENT

This is the most important function performed by any commercial bank. It is to accept

money deposits from public, which provide the basic core of all the resources available to

a bank. It accepts surplus money deposits from individuals, firms and public institutions.

In order to attract these funds it has introduced a number of savings and investment

schemes. These schemes may suit to the needs and tastes of a large body of depositors.

There is said, "Deposits are necessary for making the branches and assets are necessary for

making banks".

2.1.1 FUNCTIONS OF DEPOSITS DEPARTMENT

Provide guidance to the persons wishing to open an account by assisting of account opening

form and SS (specimen signature) card.

To maintain opened and closed register accounts.

To Dispatching letters if needed to inform them e.g. letter of thanks to the

Introducer and new account holder.

Deposit section also maintains ledger, balance it and also prepare Enquirer memos.

Posting of vouchers and Cheques in computer and maintain the records in form of

printouts.

Cancellation of Cheques.

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Issuance of cheque book.

Calculation of product.

Sorting is also done of accounts if dormant and inoperative accounts and also for the

recovery of incidental charges.

It also deals in deduction and refund cases of Zakat.

Maintenance and handling of various deposits schemes e.g. IS saving, current account.

Charring out the standing instructions and maintain the records of deposit department.

Making stop payment of cheques and noting. Cautions regarding death/ insolvency/

insanity of account holder.

Transfer and closing of accounts.

Keeping the records of debit/credit balance confirmations and statement of account.

Also provide confidential inquiries to other banks government departments and other

agencies.

TYPES OF ACCOUNTS

The deposit department contains the accounts of three major types.

Current Account

Saving Account

Fix Deposit Account

RULES OF OPENING AN ACCOUNT

Introduction of Account

Introducer signature and introducer is genuine.

The introducer is genuine to the bank. Introducer also knows the account holder whose

account he introduced.

Action must be obtained from a respectable party and the bank must know them. In this

regard the banker must know to them. In this regard the banker must satisfy himself.

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SAFEGUARD AGAINST INTRODUCTION

Avoid establishing contractual relationship with a fraudulent person.

Statutory protection under section 131 of negotiable instruments Act 1881 as collecting

agent.

Helpful in recovery of unintended overdrawn amount in the account due to wrong postings.

PROCEDURES AND PERSECUTIONS OF CD/PLS ACCOUNTS

Completion of account opening form and specimen signature card by the customer.

Clear-cut operational instructions must be obtained in the handwriting of the account holder.

Deposit in charge check the account opening form and verify the signature of the

introducer.

Photocopy of national identity card must be obtained along with the other documents.

Approval of manager is sought.

Account number is allotted tram account opened and closed register.

Entry in ledger and reference book is done.

The cash department's main function is receipt and payments. All those transactions,

which are held on the counter on cash basis lies under the cash department.

2.2 CASH DEPARTMENT

The cash department’s main function is receipt and payments. All those transactions which

are held on the counter on cash basis lies under the cash department.

2.2.1 RECEIPT

The customersdeposit in their account though a deposit slip. The deposit slip contains the

account number and title of account. The amount in figure and words are also written on

both sides of the slip. The customer deposits the amount to the cashier, which is dully

signed by the cashier and an officer; the amount is thus credited to the account holder.

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2.2.2 PAYMENTS

The amount of money is repaid to the customer though cheque.

"Cheque is a bill of exchange drawn on a specified banker and not expressed to be

payable otherwise than on demand".

2.3. REMITTANCES DEPARTMENTS

United Bank Limited also facilitates customers to send or transfer money loan one place to

another. Bank uses the flowing modes of remittances. An inland remittance means a

transfer of money payable at a certain place within the country. Inland remittances can be

classified as in the following:

Within locality

Outside locality

2.3.1. WITHIN LOCALITY

When a branch situated in Peshawar is required to send drafts of any branch/branches

situated in the same city, the process is known as within locality. For example, the United

Bank Ltd. University Branch is known as local or within locality for branches in Peshawar.

2.3.2 OUTSIDE LOCALITY

Outside locality is an important type of inland remittance. Outside locality means transfer of

money payable outside the city. For example United Bunk Ltd, University Branch sends my

draft to a branch situated at Muzaffarabad (AX) it is commonly done through the following

three means:

i) Telegraph Transfer T.T.

ii) Mail Transfer M.T.

iii) Demand Draft D. D.

2.3.4 DEMAND DRAFT

A bank draft is an order by one branch of bank to another branch of the same bank to pay a

certain sum of money on demand to the person named there in according to section 85- A

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of negotiable instruments Acts 1881, a demand draft a written order to pay money

drawn by one officer of a bank upon other officer of same bank, for sum of money

payable to or another officer of the same bank, for a sum of money payable to or to the

order of specified person on demand.

The bank issues this instrument by charging a specified amount of commission along with

government duties. The payment of draft cannot be stopped and hence it can easily used in

settlement of debts. The issuing bank also sends an advice to the paying hank. Rank also

applies secret code or test so that paying bank can test its accuracy. A demand draft can

be issued both against.

a. Cash

b. Cheque

Payment of DD

Demand draft can be paid though

• Cash

• Cash transfer

• Clearing

• Transfer delivery

Pay Slips

Pay slip is used to pay off the routine expenditure of the branch. The issuing bank is to

pay the amount. The bank also distributes house rent to employees and interest on fix

deposits through pay slip.

Pay Order

The pay orderis all instrument issued by a bank promises to pay a certain sum of money to the

payee. This instrument is used locally and issuing hank is the paying bank. Customer used it

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during shopping and setting off debts. Customer fills the application and bank received

charges and government duties.

Mail Transfer

This instrument is used on request of person to transfer this amount of money to the other

branch of same bank. The other branch may be in or out of the city. The customer might

pay cash or debit its amount for transfer purpose. Application form is filled on which all

the details mention. The Bank receives nominal charges.

Telegraphic Transfer

This instrument is the fastest node of transfer of money from one place to another. The

bank charges very high charges but the amount is transferred within a few hours. The

bank makes a telephone call and the original advice is sent later on. But on the receipt of

telegraphic transfer 'front the issuing branch.

• The telegram is decoded

• Testis agreed

• If test is agreed then it signaled by two officers Entry is made in TT payable register.

Rupee Travel Cheques

Rupee travelcheques is an instrument used to facilitate customers, not to carry huge

money but instead carry with them rupee travel cheque. The rupee travel cheque cannot be

theft and there is no risk of lost on it. The instrument can be cashed anywhere in

Pakistan and any branch of UBL. The maker of instrument signed on RTC at one corner and

to en cash it he has-to put another signature at the other corner. Thus it is very much safe

and is much more successful in ordinary business transaction. The name is used by

UBL is Hamrah Rupee Travel Cheque.

Page | 32
RTCs are not issued against thumb impression. These are only issued to the purchasers who

can sign his/her firm handwriting. RTCs arc also not issued to (lie minors or in same

persons.

Foreign Demand Drafts

Foreign demand draft against Pak Rupees is prohibited in. accordance the exchange

restrictions. However it is allowed in certain cases.

FEE or any other any foreign remittances can be made from foreign currency accounts

except against deposits in foreign currency accounts in the form of currency notes, which

is required by SBP to keep for at least 10 days. Howe ever in case of emergency banks

can entertain the request of customer against levy of service charges Rs.20 in addition to

the usual commission.

The authorized dealers are allowed to issue FDDS for the following against the surrender of

Pak Rupees.

• Examination The

• Subscription of magazine

• Membership fee for any international organization.

For a remittances purpose form is to be submitted to the SBP by the authorized Dealer.

The purchaser should complete this form, which contain the flowing information.

National identity card number

Income tax number

Purpose of remittance

Currency

Favoring

Page | 33
Foreign Currency Traveler's Cheques

Traveler's cheques are international cheques, which are issued by well know institutions

like American express, Thomas C6ok & Co, Barclays bank etc. and may be purchase

from any bank who keep their stock on the bases of well reputation. Normally all the

banks, make payment of these cheques to the travelers throughout the world and them

claim its payment form the issuing institution.

They are also available in specified denominations in foreign currency such as US

Dollars, Canadian Dollars, French Frances, German Mark, Japanese Yen, Pound Sterling and

Swiss Francs. These cheques are universally acceptable abroad, and the principle

hotels, railroads, airline's steamships lines, and merchant accept as freely as cash.

2.4 ACCOUNTS DEPARTMENT

This is the most important department in the bank. The bank daily transactions arc

recorded in computers, nowadays, so the functions of this department are to get a

summary for all the transactions. The credit and debit vouchers are arranged and saved for

the record purpose. It also indicates, the head office entries as clearing, transfer delivery

etc. At the weekend it has to prepare on H.O. extract, which is to send to head office for

reconciliation. The month ends will summaries all the monthly statements and profit and loss

is determined. Thus this department will create a link between head office and branch

office and above all maintains disc of all the transaction of current day at home so that in

any mishap the customer's benefit is saved.

a) The functions of the banks are as follows.

b) Maintenance of the book of the accounts of head office.

c) Salary disbursement and investment of staff.

d) Arrangement of stationary for bank.

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 CHAPTER 3
CRITICAL ANALYSIS

3.1 ANALYSIS OF ORGANIZATION'S STRUCTURE

In UBL the overall organization structure is tall to which upper management is not easily

accessible to lower level management. This problem arises because of the large number of

impediments in the tall organization structure; another flaw of this organization structure is

that flow of communication as restricted between upper and lower level of management

leading to message distortion, which ultimately affects the entire productivity and efficiency

of organization. Nowadays the trend is such that national and multinational organizations are

trying to reduce the layers of management so that communication flow is effective and

problems of organizations can easily be disused between top and lower management and so

can be solved quickly.

UBL has 1000 branches, which arc spread over the cities and towns of the country. These all

branches work with regional offices under control of head office. All this process is

controlled with centralization and Authority having a broad span of control. All the

executives of UBL including SEVP, EVP, SVY, VP and operations manager are delegated

with certain amount of authority. However, top management is involved in some decisions

making, which arc of little importance and in some cases of high importance as well. In

some cases branch manager also does not have authority like approving of loans.

There is no formal control and discipline system in all the branches. Any employee can go

outside at any time.

The division of workload is not equal among the employees. If an employee is absent from

his job then other employee has to do his job as well his colleague job, this all creates

hostility and discomfort among the staff.

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No coordination can be seen among employees and different divisions of UBL same are the

case with top management and lower management.

There is no specification of jobs and tasks of employees in UBL. No one is accurately

specific about his/her job. It all effects efficiency of organization.

The authority is highly centralized. If the branch manager wants to take a decision as for

example approving of higher authorities, which sit in the head office, so decision process

becomes victim of impediments.

3.2 PROBLEMS OF DEPARTMENTS

At different levels UBL uses different basis of Departmentation. Basis of Departmentation at

higher level is functional. In functional following problems were found.

3.2.1 COORDINATION OF PROBLEMS

Functional department has caused the lack of coordination between functions of different

departments.

3.2.2 SLOW RESPONSE OF CUSTOMER

Due to such Departmentation the bank is very slow to respond quickly to customer's demand

or needs because if a customer needs something his or her need passes through different

departments so it takes a long way. For example if one have fast cash from foreign country,

first he have to call Karachi to confirm that the money is transferred or not than he have to

come to bank and have to wait for hours to receive his/her remittance.

3.2.3 POSSESSION OF SOLE RESPONSIBLITY LIES WITH BOSS

The president undertakes the critical decision leading to success of failure of organization.

So in this regard he is responsible for the success or failure the bank.

3.2.4 LACK OF PROPERLY DEFINED FUNCTIONS

This Departmentation has created such a system in which functions are not properly defined.

So naturally the system’s unclear functions are not properly defined. So naturally the system

Page | 36
is distorted and confusion and conflict exist among the employees within the organization

because everyone in the organization has his/her narrow point.

3.3 FINANCIAL ANALYSIS

Financial analysis (also referred to as financial statement analysis or accounting analysis)

refers to an assessment of the viability, stability and profitability of a business, sub-business

or project. It is performed by professionals who prepare reports using ratios that make use of

information taken from financial statements and other reports. These reports are usually

presented to top management as one of their bases in making business decisions. Based on

these reports, management may:

Continue or discontinue its main operation or part of its business;

Make or purchase certain materials in the manufacture of its product;

Acquire or rent/lease certain machineries and equipment in the production of its goods;

Issue stocks or negotiate for a bank loan to increase its working capital;

Make decisions regarding investing or lending capital;

Purposes of Financial Analysis

Profitability –

Its ability to earn income and sustain growth in both short-term and long-term. A company's

degree of profitability is usually based on the income statement, which reports on the

company's results of operations;

Solvency –

its ability to pay its obligation to creditors and other third parties in the long-term;

Liquidity –

its ability to maintain positive cash flow, while satisfying immediate obligations;

Stability-

Page | 37
the firm's ability to remain in business in the long run, without having to sustain significant

losses in the conduct of its business. Assessing a company's stability requires the use of the

income statement and the balance sheet, as well as other financial and non-financial

indicators.

UNITED BANK OF PAKISTAN THREE YEARS PERFORMANCE

Rupees in ‘000’

Item 2019(Rs) 2018(Rs) 2017 (Rs)

Cash And balances 115,442,360 115,827,868 106,503,756

Balances with other banks 30,389,664 28,405,564 38,344,608

Lending to financial institution 23,025,156 19,587,176 17,128,032

Advances-net 477,506,564 475,243,431 412,986,865

Investments-net 301,323,804 217,642,822 170,822,491

Deferred tax assets 6,952,666 3,062,271 3,204,572

Other assets-net 53,496,240 59,666,438 44,550,347

Profit After Tax 17,563214 19,033,773 17,022,346

Earning Per Share 17.23 23.34 24.01

Return on Assets 4.23% 4.40% 4.0%

Number of Branches 1,266 1,261 1,250

Number of Employees 16457 15,204 14,079

RATIO ANALYSIS
A tool used by individuals to conduct a quantitative analysis of information in a company's

financial statements. Ratios are calculated from current year numbers and are then compared

to previous years, other companies, the industry, or even the economy to judge the

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performance of the company. Ratio analysis is predominately used by proponents of

fundamental analysis.

LIQUIDITY RATIO

Cash Ratio

This ratio shows that the cash is enough for payment of current liabilities or not. “This ration

is obtained by dividing cash by current liabilities / liabilities, as show below.”

Cash Ratio = Cash / Current Liabilities

Years Cash / Current liability Cash Ratio

2019 115442360 / 860262110 0.1341

2018 115827868 / 783406761 0.1478

2017 106503756 /675642277 0.1576

Current Ratio

Current ratio, expresses a company's ability to repay short-term creditors out of its total

current assets. The current ratio is the result of dividing the total of current assets (incl.

stocks) by short-term borrowings. It shows the number of times short-term liabilities are

covered by current assets. If the value is greater than 1.00, it means fully covered.

The formula is as follow…

Current Ratio = Current Assets / Current Liabilities

Years Current Assets / Current Liabilities Current Ratio

2019 115442360/ 860262110 1.16

2018 115827868 / 783406761 1.14

2017 105603756 /675642277 1.15

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Interpretation

The Current ratio for the 2018 is just in line with 2019, it shows that 1 rupee of

Current liability is has 1.15 rupee of current assets. But in 2017 it is going to decrease to 1.10

it shows that mostly receivables are not collected. It is because of written off loan in 2017

that is approximately 2481.70 million.

Earning Per Share Ratio

A company's profit divided by its number of common outstanding shares. If a company

earning $2 million in one year had 2 million common shares of stock outstanding, its EPS

would be $1 per share. In calculating EPS, the company often uses a weighted average of

shares outstanding over the reporting term.

The formula is as follow.

EPR = Net income/ outstanding number of shares

Years Net income/ outstanding number of shares EPS

2019 17,563,214/1,345,463 13.05

2018 17,561,846/1,345,463 13.05

2017 15,458,590/1,076,370 14.36

Interpretation

The Earning Per Share for the financial years 2019 is 13.05 then it is going With Almost

Same Rate 13.05 in 2018, but in 2019 Its Increases at 1.31 Rate To 14.36.

Return on Assets

The Return On Asser Percentage Shows How A profitable A company asset are in generating

Revenue

Fromula For Return on asset is

Return On Asset = (Net profit/ Total assets) *100

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Years (Net profit/ Total assets) *100 Return On Asset

2019 17,563,214/1,035,024,680*100 1.69%

2018 17,561,846/944,582,762*100 1.85%

2017 44,100,934 / 316,110,406 1.89%

Interpretation

Return On Asset ratio is 1.89% in the Year of 2017 Which Is higher Form the Next Year like

in 2018 . In 2012 its 1.85% . in in the year of 2019 its 1.69% Which Is Lowest In these three

Years.

Total Assets Turn Over Ratio

The asset turnover ratio calculates the total revenue for every dollar of assets a company

owns. To calculate asset turnover, take the total revenue and divide it by the average assets

for the period studied

Asset Turnover = Total Revenue /Average Assets for Period

Years Total Revenue / Average Assets for Period TATO Ratio

2019 60933234 / 413,076,390 0.081

2018 51,147,457/ 340,677,100 0.071

2017 36,435,929/ 316,110,406 0.073

Interpretation

The Total assets turn over ratio is decreasing rate from 2018 to 2019 and then in 2017 it is

going to increase which is a good sign for NBP.

Fixed Assets Turn Over ratio

The fixed asset turnover ratio measures the company's effectiveness in generating sales from

its investments in plant, property, and equipment. It is especially important for a

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manufacturing firm that uses a lot of plant and equipment in its operations to calculate its

fixed asset turnover ratio.

The formula show as is follow.

Fixed Asset Turn Over Ratio = Interest Earned / Fixed Assets

Years Interest Earned / Fixed Assets F.A.T.O Ratio

2019 60,942,798 / 71,972,574 0.84

2018 50,569,481 / 56,917944 0.88

2017 44,100,934 / 36,795,672 0.07

Interpretation

The three years comparison of fixed assets turn over ratio for United Bank shows that the

ratio has increased for the year 2018 to 2019 and then in 2017 it decreases in the total amount

of markup slash interest earned and increased in fixed asset has brought this ratio down.

Return on Assets

This ratio shows the efficiency of organization that how efficiently utilizes their assets. This

ratio relates profits to assets. It is calculated as:

ROA = Profit after Tax / Total Assets

Years Profit after Tax / Total Assets ROA Ratio

2019 17,563,214/1,035,024,680*100 1.69%

2018 17,561,846/944,582,762*100 1.85%

2017 15,458,590/817,758,326*100 1.89%

Interpretation

The Return on assets ratio of United Bank is good in 2011 but then it is decline in the 2012

and so on decreasing in the 2013 which is 1.69% may be due to excessive prepayment.

Page | 42
 BALANCE SHEET FOR THE YEAR ENDED DEC, 2017, 2018, 2019

2017 2018 2019

Rupees in ‘000’ Rupees in ‘000’ Rupees in ‘000’
Assets

46,310,478 55,487,664 56,533,134 Cash and balances with treasury banks

35,965,048 27,020,704 39,307,321 Balances with other banks

6,550,128 1,628,130 6,193,787 Lending to financial institutions

119,587,476 177,942,251 138,145,692 Investments

349,432,685 382,172,734 456,355,507 Advances

21,535,471 27,346,111 14,751,252 Operating fixed assets

11,954,876 13,780,555 35,419,252 Other assets

2,725,486 6,613,372 11,22,444 Deferred tax assets

594,061,648 691,991,521 712,409,137 Total Assets

Liabilities

9,507,637 15,418,230 9,944,257 Bills Payable

56,392,270 58,994,609 46,844,990 Borrowings from financial institutions

459,140,198 531,298,127 597,090,545 Deposits and other accounts

- 3,100,000 3,954,925 Sub-ordinated loans

15, 578,177 19,943,126 24,913,236 Other liabilities

540,618,282 628,754,092 673,798,121 Total Liabilities

Represented By

6,900,000 6,900,000 7,590,000 Share capital

17, 802, 584 19, 821,455 24,243,254 Reserves

20,475,080 28,341,670 39,447,648 Inappropriate profit

53,443,366 63,237,429 75,180,436 Total Equity

594,061,648 691,991,521 712,409,137 Total Liability & Equity

Page | 43
 INCOME STATEMENT FOR THE YEAR ENDED DEC, 2017, 2018, 2019

2019 2018 2017

Rupees in‘000’ Rupees in ‘000’ Rupees in‘000’

Mark-up/Return/interest earned 63,305,033 50,481,021 43,685,740

Less: Mark-up/Return/interest expensed 26,525,556 19,153,957 13,204,037

Net Mark-up/Interest income 36,779,477 31,327,064 30,481,703

Provision against non-performing loans and advances 6,904,919 8,238,227 2,863,207
Reversal Provisions against off – balance sheet obligations 372,598 (54,626) (45,438)

Bad debts written off directly 1,909,887 (84,310) (13,697)

Net Mark-up/Interest Income after provisions 27,592,073 23,227,773 27,677,631

Add :Non Mark-up/Interest Income

Fee, commission and brokerage income 4,518,408 3,420,051 3,931,710

Income Gain on Investment 2,369,233 2,472,663 1,219,623

Income from dealing in foreign currencies 2,374,318 1,487,374 1,102,358

Other income 3,116,522 2,643,076 2,235,805

Total non-mark-up/interest income 16,378,811 10,023,164 8,489,496

43,970,884 33,250,937 36,167,127

Less : Non Mark-up/Interest Expenses

Administrative expenses 21,348,016 18,297,279 17,149,232

Other provisions/write offs 200,163 (276,111) 122,510

Other charges 64,751 85,152 54,898

Profit before taxation (EBT) 22,034,379 15,144, 617 18,840,487

Taxation:

- Current 8,661,150 7,220,717 7,144,846

- Prior years 233,100 1,668,562 (39,067)

- Deferred (2,473,891) (3,828,699) (965,607)

Profit After Taxation (EBIT) 15,614,020 10, 084,037 12,700,315

Source: Annual Report Habib Bank ltd. for the year ended 2019

Page | 44
SWOT ANALYSIS

STRENGTH
1. First bank to start Islamic banking in Pakistan.

2. Provincial government backing and confidence of people due to government bank.

3. It has modern technology and resources.

4. Staff has combination of young and rich in experience and working skill.

5. Officer attractive schemes and ,more saving for customer from time to time.

6. UBL has market confidence in providing products and services to the customers

over the year.

7. UBL has the ability to cope with pressure of competition.

8. Bank has the good with of the people and it is also an assets to it.

9. Bank’s management has the motivation to make it best bank of the country.

WEAKNESS
1. Employees are lacking motivation. Bank is not limits and thus reducing the

efficiency.

2. Communication gap between different levels of management.

3. The lower level management lacks clear direction and is not having the managerial

depth.

4. Lack of experienced commercial bankers in the top management positions

5. Lack of modern banking approaches like ATM and commerce on line banking.

6. Marketing skills of the bank are good but they have little presence at different

media.

7. Low salary structure as compare to competitors.

8. Not in the position to compete with other banks.

Page | 45
9. Lack of highly trained resource staff. Increasing trend of bad loans.

10. Lack of modern technology.

OPPORTUNITIES

1. Opportunity to open branches in northern areas specially Timergara etc because

there is 100% current deposit.

2. Extending banking hours and providing more branches facilities to customers.

3. All branches are computerized therefore no difficulty

in thinking it into on line banking.

4. Bank should take interest in the new market segments like IT business, software

business etc.

5. A new serves to its product line.

6. Increasing credit facilities to lower income groups, thus reducing the risk of loss and

also improving the image of the bank.

THREATS

1. Political, economical situation of the country. Reduction in the business activities in

the country.
2. Deteriorating confidence of people in bank uncertainties of the investors.
3. Modern technology used by other commercial banks.
4. Starting Islamic banking is threats for BoK because if it is flop it will be a big loss
for BoK.
5. Increasing number of private/foreign banks in the country.
6. Reducing the rates of savings in different segments of people.
7. Global technological advancement.
8. Bank Alfalah and other commercial banks is the biggest threat for BoK.
9. Qualified staff working in other banks.

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 RECOMMENDATION
In this Chapter recommendations are given for improvement of the bank from organizational

and marketing perspective, these recommendations can contribute towards the improvement

in performance of United Bank limited the following course of action is suggested to enhance

further improvement in the working of the UBL's HRM and marketing strategies & policies

and some improvements in its credit department.

HUMAN RESOURCE MANAGEMENT OF UBL

Motivators should be used to overcome the problem of limited internal transfer, limited job

rotation and downsizing which result into disinterest in work, uncertainty among

employees. The Bank should concentrate. On motivators like recognition, responsibility,

advancement growth, and opportunities for achievement,

COMPUTER TRAINING:

The Bank should provide computer training to their employees sothat at least they should

become aware of operating system Ms-Office, Internet and e-mail usage and relevant

accounting software's.

EDUCATION LEVEL FOR NEW RECRUITMENT'S:

The education standard for new recruitment should be master degree like MBA & M.COM

etc. This willenable United Bank Ltd. to Work in competitive banking business

environment.

MANAGER'S FRIENDLY ATTITUDE:

The manager should have friendly attitude to subordinates and his friendly attitude will

overcome the tense working environment.

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JOB CUTS:

In order to privatize UBL a lot of downsizing has already been done. . The privatization of

UBL has also led to uncertainty among employees regarding the fate of their jobs and any

further job cuts will result to hate and hostility from the rest of the employees in the shape of

strikes by UBL Employee Union.

POWER SHOULD BE GIVEN TO HRD:

The HR division should be given actual power in matter rotating to recruitment and selection

of new employees and other then this promotion and appraisal of employees should rest

purely with the HR department.

PERFORMANCE SHOULD BE REWARDED:

Good performance and efforts should be rewarded equitably so as to encourage initiative and

enhance motivation level of employees. This will help in building team, which is totally

motivated..

BETTER JOB EVALUATION:

The pay for each job should be based upon the time worth or value of job.

REFRESHER COURSES:

The Human of the Bank should frequently conduct meaningful refresher courses Resource

Division, seminars and workshops with a view to improve the knowledge of the staff. Due to

strict competition and technological developments, the banking business is experiencing

speedy changes therefore; the HRD should have arrangements for staff training's to coup with

the new changes that may become threats for the interests of the Bank.

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FRINGE BENEFITS:

UBL should provide a competitive fringe benefits package to their employees.

EMPLOYEES COUNSELING:

Counseling is an effective approach in reducing conflicts, tensions and work place

apprehensions. The manager should try to advice and counsel the subordinates and

help them in solving their problems.

MARKETING

Regarding the marketing strategies and policies of UBL; it is suggested that: -

MARKETING AT DESK:

UBL should improve there: public relation skills', and start marketing provision service at

desk. They are the first line of personals, in direct contact with the general public so they

must be capable enough to turn a prospective customer into a full tie customer.

MARKETING DEPARTMENTS AT HUB BRANCHES

There should be a separate marketing department in each Hub branch, which could easily

implement the marketing policy of Head office. This will help not only in increasing the

market share, but also help in identifying prospective customers.

INTEGRATED MARKETING APPROACH

Integrated marketing approach means that all the departments of a branch need to be involve

in marketing, marketing should not only be the job of marketing personnel but every person

of the bank should struggle for the image building of the hank and this thin; is , much more

needed in case of banking sector.

CUSTOMERS RELATIONS DEPARTMENT

United Bank Ltd should develop a separate customer relations department. This will

help the bank to know about the customer's needs, satisfaction and suggestions.

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ADVERTISEMENT

United Bank Ltd. should do the promotional activities like reminder advertisement. In this "Push

Button" world everyone seems to be quite busy, so UBL should adopt such marketing and

advertisement policy to promote their services using electronic Media-Advertisement plays the

character of soul in promoting an organization, its products and services. In order to magnetize

customers to the bank, UBL should develop a long term and reasonable plans for the

advertisement of its services.

PROMOTION OF LENDING FACILITIES

Lending is the major source of the revenue of a bank. One major drawback seen in this area is

that the bank doesn't promote its lending facilities, as a result no one know what the bank is

offering for the borrowers. Along the promotion for collection of deposits, UBL should also

promote its lending and credit services through marketing activities and for this they should

take help of media.

EMPLOYEES' TRAINING FOR MARKETING

It's the era of specialization, the employees of UBL being specialists in other areas of

banking, should also be given necessary training for marketing. This will help in integrating

the marketing activities of the bank and will help in image building of the bank.

CUSTOMER ORIENTATION

The bank should make its level best and do hard work to provide customers a quality and

timely services. The bank' should respect their customers.

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 REFERENCES

1. www.google.com

2. brushers and pamphlets

3. Balance Sheet of UBL (Dec, 31, 2019)

4. (On-line) Available http://WWW.UBL.Com

5. Schedule of Bank Charges 2019-20.

6. Account Opening Form of UBL.

7. Annual Report of UBL

8. www.ublfirst.com

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