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Internship Report on Shakarganj Sugar Mill Ltd.

In The Name Of ALLAH The Most Beneficent, The Most Merciful


University of education Lahore (Multan campus)
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Submitted To: Mam Maria Kanwal Submitted by: Muhammad Asif Noor MBA (Finance) Roll No: Session : 5127 2010-2012

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Department Of Management Sciences University Of Education, Lahore (Multan campus)

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University of education Lahore (Multan campus)


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Internship report on Shakarganj Sugar Mill Ltd

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Submitted by Ailiya Rizvi

Supervisor Miss Tallat Shahid

Registrar Shaista vine

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DECLARATION
An Internship report submitted to the department of Management sciences, University of Education Lahore (Multan campus) in partial fulfillment of the requirement for the degree of MBA.

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Dedication
I dedicate my report to my parents who really help me in the completion of such a lengthy and complicated project.

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ACKNOWLEDGEMENT: I offer my humblest thank to Allah and Hazrat Muhammad (PBUH) from the deep of my heart that always provide me guidance and blessings which are uncountable. This task was assigned to me by MBA (Finance) and I complete this task with my full concentration and devotion. I have completed this repot with the help and support of many people who encourage and guide me in completion of my task. I most courteously acknowledge the great support and help Mr. Muhammad Asif AVP Finance, Imran Ahmed sahib Incharged credit officer. I also acknowledge M. Taqi sahib Incharge Accounts. I greatly thank full to all these people who guided me at every step and provide me help in completion of my task. I am highly indebted to my course instructors who provided not only an opportunity to learn about practical work and its implementation but also guide me through email for its completion. I am very great full to my Teachers who always helped me. I am also thankful to my beloved parents and all those people who support and guide me in the completion of my report. THANKS

Preface
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The main purpose of the internship is to fulfill the academic requirements of my study. It encourages learning with emphasis on assigned projects. Besides this, the other purpose is to give a comprehensive review of Shakarganj Sugar Mill Ltd. Jhang. The most important point in an Internship Program is that the student should spend their time in a true manner and with the spirit to learn practical orientation of theoretical study framework. This report is about my internship that I have undergone at Shakarganj Sugar Mill Ltd. jhang from 5th April 2012 to 15 May 2012 .During my internship I am able to learn practical aspect of business, and get good working experience.

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Executive summary
My internship duration in Shakarganj Sugar Mill Ltd. was 05.04.2012 to 15.05.2012. I did work in Agricultural and Rural Business Division Lahore. I had worked in Finance and IT department. In my report i describe my all information about my work in Shakarganj Sugar Mill Ltd. It was incorporated in Pakistan on 1967, as public limited. Currently it has 226 branches and 4,393 employees. Shakarganj Sugar Mill Ltd. Deals with all kinds of banking like corporate and investment banking, consumer banking services and Islamic banking etc. During working in MIS of Shakarganj Sugar Mill Ltd. I performed many task and assignments which include maintenance of record related to insurance of crops, assets financed and life assurance of borrowers availing agriculture loans etc. and assist in insurance proposals. I also consolidate and compile various statement / periodical reports for the review of Management and State Bank of Pakistan. I also learn about the statements of farm and non farm sectors and consolidation of data regarding these statements. I also discuss in my report products and service, business volume, competitors, ratio analysis and future aspects of Shakarganj Sugar Mill Ltd. I have learned many things during my internship program which enable me to mange my work properly and gave me confidence in decision making. In my opinion Shakarganj Sugar `Mill Ltd. Perform its task very well and satisfy there employees and customers with full responsibility.

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Table of contents
Chapter

Topic INTRODUCTION History & Background Business Philosophy Vision Statement/ Mission statement Market Standing MANAGEMENT SYSTEM Organizational Chart Corporate Profile Management Hierarchy Policy Formation process Managerial Policies MARKETING MIX Product Price Place Promotion Publicity FIANANCIAL STATEMENT ANALYSIS Trend/ horizontal analysis Vertical Analysis Financial Ratio Analysis SWOT ANALYSIS Strength Weakness Opportunity Threat

Pg no

11 14 17 19

21 25 29 32
36 45 56 63 67 73 86 97 101 102 103

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TRAINING PROGRAMME Divisional or Departmental detail Activities of intern Projects assignments completed PROBLEMS AND RECOMMENDATIONS CONCLUSION List of annexure

105 156 157 159

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INTRODUCTION SECTOR:

OF

ORGANIZATIONS

BUSINESS

We, at Shakarganj, have served the local community since our founding in 1967 and through our Social Action Programme; we improve the lives of the rural population by connecting and empowering resources. We are not merely serving the underprivileged, but are responsible corporate citizen at all times by acting as a unifying and multiplying force. Through our funding programmes, we seek to create lasting, meaningful solutions rather than short-lived approaches to community problems. Through strategic planning and community involvement, our core values have been specifically articulated. These core values are the centre of our organization as we seek to serve the local community to the best of our ability. Our SML team is directly involved in carrying out charitable activities and adds new causes on a quarterly basis to expand the programmed. Shakarganj is focused on developing five key areas: educated youth, empowered women, a healthy population, a culturally rich environment and a better community. For the efforts undertaken towards the community, Shakarganj received the 2008 Intel-AIM Corporate Social Responsibility Award and was the first Pakistani company to receive this prestigious distinction.

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OVERVIEW OF THE ORGANIZATION: Brief History: Shakarganj Mills Limited was incorporated in Pakistan in 1967 as a Public Limited Company and is listed on all three stock exchanges of Pakistan. Shakarganj is a leading manufacturer of food products, industrial ethanol and particle board as well as textiles. We transform renewable crops such as sugarcane and cotton into value added products comprising refined sugar, textiles, industrial grade ethanol and building materials in addition to generating electricity from biogas. The Company has two manufacturing facilities in Jhang District. Our registered office is in Lahore. Shakarganj Mills, through its interest in Shakarganj Food Products Limited, is also active in production of dairy and fruit products.

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c. Business volume: 2009 Assets Advances Deposits Capital Profit 182,171,885 100,780,162 143,306,707 3,006,499 2,681,012 Liabilities 165,905,898 2010 206,191,138 193,219,775 128,818,242 167,676,572 4,058,774 386,225 2011 254,327,446 239,378,374 135,034,499 205,970,227 5,073,467 1,107,793

d. Product
Product lines (product and services of the organization) A product Shakarganj Sugar Mill Ltd. Ltd includes all those services which customer normally required for effectively managing his business. Shakarganj Sugar Mill Ltd. Ltd offers the following services to its customers.

Mahana Bachat Account Roshan Mustaqbil Deposit Deposit Multiplier Account Personal Finance Islamic banking services Agricultural finance solution Corporate & investment banking

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Mortgage Finance Debit/Visa Card International banking services

ASKARI MAHANA BACHAT ACCOUNT: (1 + 3 YEAR TENURE)


Multiples of 25,000 should be deposited. Earn Mark up of 11.1% p.a on investment of Rs.100, 000 for every month. Earn mark up of 12% p.a on investment of every Rs. 100,000/- for every month. Askari Mahana Bachat Account is a Term Deposit facility available to individual customer with the option of 1 and 3 Years tenure. The deposits are

ROSHAN MUSTAQBIL ACCOUNT


Shakarganj Sugar Mill Ltd. has launched the Askari Roshan Mustaqbil Deposit, a saving plan specially designed for individual investors who wish to invest now for a regular return at a later stage while keeping their principal amount. With Askari Roshan Mustaqbil Deposit, you can double your investment in a time period of ten years. Invest now in the form of monthly deposits for five years and get paid back the same amount for the next five years while receiving your principal amount in full at the end of the tenure.

DEPOSIT MULTIPLIER ACCOUNT


Value of initial investment of Rs. 100,000/- will increase to Rs.

265,000/- at maturity This account is for individual investors whose purpose is long term savings with high returns. With a tenure of 10 Years and a competitive rate of return on maturity this account is ideal for investors who wish to start saving for their future today.

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Personal Finance
One can avail unlimited opportunities through Shakarganj Sugar Mill Ltd. s Personal Finance. With unmatched financing features in terms of loan amount, payback period and most affordable monthly installments, Shakarganj Sugar Mill Ltd. s Personal Finance makes sure that you get the most out of your loan.

Islamic Banking services


Islamic Banking was launched under the brand 'Askari Islamic Banking', by opening 6 dedicated Islamic Banking branches in major cities of the country. Further expansion is planned with improved capabilities for offering products conforming to the Shariah principles. There are following Islamic banking services: Islamic Corporate Banking Islamic Investment Banking Islamic Trade Finance Islamic General Banking Islamic Consumer Banking

Agricultural Finance Solutions

Kissan Ever Green Finance Kissan Tractor Finance Kissan Transport Finance Kissan Aabpashi Finance

Kissan ever green Finance


Shakarganj Sugar Mill Ltd. has launched this program with the sole motive to provide dignity, prosperity and freedom to the tiller of the land.

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Corporate & investment Banking


Corporate Banking Division Term Loans Fund transfers/Remittances Project Finance

PRODUCTS OF Shakarganj Sugar Mill Ltd. There are following features of this account: DEMAND DEPOSIT
Current Account
Call Deposit Receipt

IMPORT RELATED FINANCE


Payment Against document

Finance Against imported Merchandise Finance against Trust receipt

TIME DEPOSIT PLS saving Deposit FINANCE


Askari special Deposit account

EXPORT

RELATED

Askari FISDA Account


Askari FAIDA Account Finance

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Value Plus Saving Deposit

Notice Deposit
Askari Advantage Demand draft

Term Deposit
Telegraphic transfer Pay order

Online banking
Foreign TT Travelers cheque Askari master credit card Askari debit card

Lockers Small Size Lockers Internet banking Medium Size Lockers Large size lockers Fund Based Loan
Running Finance Cash Finance Term Finance Staff Finance Askari Personal Finance Trade Finance

Non-Fund Based Loan


Letter of Credit (LC) Letter of Guarantee (LG)

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GENERAL BANKING DEPARTMENT

Account opening Remittance Department Cash Department Clearing Department PRIVILEGE BANKING DEPARTMENT

Online banking Lockers

FOREIGN EXCHANGE DEPARTMENT

Import Department Export Department Foreign Currency Department

CREDIT DEPARTMENTs ACCOUNTS DEPARTMENT IT DEPARTMENT

COMPETITORS
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Sugar industry is growing much fast. So Shakarganj Sugar Mill Ltd. is facing a lot of competition in the market. There are following competitors:

Kashmire Sugar Mill Facto Sugar Mill Indus Sugar Mill Prime Commercial bank The bank of Punjab Bank Al-Habib Ltd My bank Ltd Silk Bank Ltd NIB Ltd Allied Bank Ltd Faysal Bank Ltd National Bank of Pakistan Meezan Bank Limited MCB Bank Limited NIB Bank Limited United United Bank Limited Habib Bank Limited House Building Finance Corporation Khushhali Bank Limited

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2.ORGANIZATIONAL STRUCTURE:
HIERARCHY AT THE Jhang BRANCH

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. BRANCH MANAGER

FOREIGN EXCHANGE\T RADE DEPT ` CLEARING

CREDIT DEPT

CASH DEPARTMENT REMITT ANCES

CUSTOMER SERVICE

INCHARGE GENERAL

BANKING

ACCOUNT OPENING

NON-CLERICAL STAFF

Introduction of Departments: GENERAL BANKING DEPARTMENT GENERAL BANKING DEPARTMENT


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

TYPES OF ACCOUNTS

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The customer can open his bank account in order to deposit or withdraw amount. The bank offers different types of accounts which are as follow:
Current account Saving account Askari special deposit account (ASDA) Basic banking account (BBA)

ACCOUNT OF GENERAL CUSTOMERS


Minor account Illiterate person account Individual account Joint Account

ACCOUNTS OF SPECIAL CUSTOMER

Sole Proprietorship Account Partnership Account Limited Companys Account Agents Account Joint Stock Company Account Agency Account Clubs, Societies /Association Accounts Trusts

Local Bodies Etc.


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Executors & Administrators Account

CURRENT ACCOUNT (CD)


The current account is also called CD account and the Code used for this account is 0110.Current account can be opened by an individual, jointly, and also by the company. The initial deposit in order to open this account is Rs.5000.The account holder does not bear any loss and no profit is given on this account. There are three options which are given to customer like

SAVING ACCOUNT
The saving account is also called PLS account. The saving account can also be opened individually, jointly, and by company but mostly this account was opened by individual and jointly. This account can be opened with the minimum deposit of Rs.100 Profit was given on this account is semiannually and the profit rate is 5%. The profit was automatically adjusted by the electronic data division (EDD) on the amount of deposit. The code which is used for this account is 01100.

The things which are required in order to open this account are
Computerized national identity card (CNIC) Letter from the company where the person is currently working In case of thumb sign also require passport size photographs Source of income Number of dependents National tax number (NTN)

The state bank of Pakistan gives facility to different people by giving different feature in current account like introduce BASIC BANKING ACCOUNT BBA.

BASIC BANKING ACCOUNT (BBA)

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The basic banking account is also called BBA account and the code which is used for this account is 01021. This account can be opened individually or jointly. This account was mostly opened by the Pensioner Lower income people House wife Students Salaried person

Maximum two deposits and two withdraw can be made by the account holder in a month. The bank does not deduct any extra charges even if the amount is less than Rs.5000, but if the transaction exceeds its limit than the bank charge Rs.25 for every transaction. This account can be opened with the minimum deposit of Rs.1000. No profit was given on this account.

ASKARI SPECIAL DEPOSIT ACCOUNT (ASDA)


The Askari special deposit account is also called ASDA. This account can also be opened individually, jointly, and by the company. The code which is used account is for this account is 01165.The account was offered specially by the bank by its name and the features that it maintains which are: The account holder can only share the profit not the loss. There is no limit on the transactions The profit was given at the rate of 5% on monthly basis. It can be opened with minimum deposit of Rs.10, 000 but profit was given on the amount exceeding Rs.50, 000.

ACCOUNT OPENING REQUIREMENTS


FOR PROPRETORY COMPANY

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copy of CNIC

original letter head and rubber stamp of proprietor NTN no FOR PARTNERSHIP COMPANY copy of CNIC of all partners Resolution on original letter head of company & rubber stamp of partner on which operation of account clearly mention. Partnership deed dully attested by company registrar/notary public Registration certificate if required Introduction PUBLIC & PRIVATE COMPANY Copy of CNIC of all directors & authorized signatories attested by company Sectary Resolution of board of directors on original letter head of company with rubber stamp & embossed common seal of company in which operation of account clearly mentioned. Memorandum & Articles Of Association attested by SECP FORM 29 attested by SECP certificate of incorporation/ commencement of business attested by SECP List of directors on companys letter head Company embossed common seal on AOF

ACCOUNT OPENING PROCEDURE


The general procedure of account opening is same but the document required to open the account is different according to type of account. Information at the time of opening of account, the bank officer must assure that customer has the following characteristics:

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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. The customer must not be debarred under any law from entering into any contract. 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.

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. Introducer having doubtful dealing with the bank should be discreetly declined. Current account holders can be introducer of both types of deposits but saving bank account holder cannot be the introducer of current account holder. But in exceptional cases they can introduce when saving account holder maintain substantial balance and they are old and operative accounts.

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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. Latterly, this card is scanned in the computer and whenever customer makes any transaction in this account then his signature is verified by it.

UNDERTAKING FORMS
There is different type of undertaking which are taken by the bank at the time of opening the account, two of them are: Sign differ form Vernacular form

SIGN DIFFER FORM


This form was filled by the client at the time of opening the account, if the initial which was made on the computerized identity card is different from the one which is made on the account opening form. This is actually the declaration which is given by the client that the client used different signature for operating account from the one that was made on CNIC.

VERNACULAR FORM
This form was filled by the customer, if the client used the thumb impression in order to operate account and also in case if the initials was shaky, mean there is slightly difference every time in signature. This is also the sort of undertaking which was taken by the bank in order to protect itself. It was clearly mentioned on this that in such cases if any fraud occurs than banker is not responsible for this.

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LETTER OF THANKS After the opening of account, the bank sends this letter to the account holder address. There are different purpose of this letter, some of them are To create goodwill To make sure that all the problems are solved efficiently and effectively the most basic purpose is to verify the account holder address, the bank send this letter to the account holder address and if the result was not accurate the letter was again received by the bank and then again verify the address from the account holder and again send till that the account holder not receive that letter. The bank is not issued the cheque book till the address was not verified.

HIGH RISK ACCOUNT


There are some accounts which are declared by the bank as high risk account, mean in this account there are more chances of fraud etc. These accounts are needed to be monitored very closely. High risk account includes:

Lawyers account Real estate account Politicians Staff of Shakarganj Sugar Mill Ltd. Staff of money exchanger Beaurocates

ISSUANCE OF CHEQUE BOOK The customer fills the Form A 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 officer enters the issuance of cheque book in register. To minimize the misappropriation bank stamps the account number on each leaf of cheque book. Bank Charges Rs.2 per leaf. ACBL issue 25 t0 100 leaves cheque

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books. If cheque book is lost then customer fill the From B for resonance of cheque book. Bank Charge Rs.100 for resonance. ACCOUNTS NOT IN USE

INOPERATIVE ACCOUNTS Accounts which are not in use for 1 year are considered as inoperative accounts

DORMANT ACCOUNTS
Accounts which are not in use for 6 months are considered as dormant accounts 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.

CLOSURE OF ACCOUNT
In order to close the account, the account holder needs to fulfill the form by the name of closure of account. With this form the client also need to give back his cheque book that he holds due to his account. After collecting the cheque book and verifying all the things, the bank cancel the cheque numbers and close the customer account on his request. The bank will charge Rs.100 for closure and remaining balance in the applicants account will be paid to account holder.

REMITTANCE DEPARTMENT
The remittance department deals with the transfer of money from one place to another. This department deals with the local currency transfer only. Shakarganj Sugar Mill Ltd. Ltd provides these services to both customers & non-customers

Functions
Managing issuance of demand drafts

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Pay orders Travelers cheque Mail transfer Managing Call deposit receipts CDR Intercity clearing Outward bills for collection (OBC) Credit card advance Cancellation of pay order & demand draft

INSTRUMENTS OF THE REMITTANCES DEPARTMENTS


DEMAND DRAFT A demand draft is an instrument, which is drawn by one bank upon another bank for a specific sum of money payable on demand. It is made by the bank and given to the purchaser against cash or cheque. If two banks are involved, then one bank sends a DD to another bank. But in customer - Bank case the customer sends his DD to the receiver. PAY ORDER Pay order issued from one branch only be payable from the same branch. It is normally issued for payment in the same city.

Fill the application form. Issue pay order after recovering cheques. Do necessary vouchering. Make entry in PO issue register.

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All pay order shall be crossed" payees account only". AMOUNT Up to 1million Above 1million INTERCITY CLEARING CHARGES Rs.65 (for admission fee Rs.25) Nil

In intercity clearing, clearing between cities are done. For example in Lahore, branch of Shakarganj Sugar Mill Ltd. exists, ASKARI branch Jhang sends the cheque through NIFT to main branch which will further sends to Shakarganj Sugar Mill Ltd. Karachi branch for clearing and at the same process they send back the advice. If it returns, Rs.65 will be charged. OUTWARD BILLS FOR COLLECTION If in any city, Askari branch doesnt exist, then we stamp OBC and directly send it to that banks branch for clearing.

CALL DEPOST RECEIPT

CDRs are used for the purpose of tendor notice, zakat deduction, taking part in the bidding, for getting Govt. tendor in favor of customer name. In this process, payment is secured and if approved then lodged in clearing.

For participating in the bidding process, deposit Rs. 5,000 . TRAVELERS CHEQUES
Askari travelers cheques are a valuable financial service of ACBL. They are issued to settle all your business transaction and customer can travel without any pocket load. It is safest substitute for cash, easily refundable in case of theft and loss. Shakarganj Sugar Mill Ltd. issues the traveler cheques denomination of Rs. 10,000.

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Askari traveler cheques are issued against cash cheque or debit to customer account. It is issued on purchase agreement form and 3 copies are prepared. One is sent to head office, the second one for record of bank and third one for the custom. No service charges are taken on it. Any branch of ABL can make payment of Askari traveler cheque. It can be drawn by another bank through collection. It can be encased form the issuing branch but not on issuing date. If these cheques are enchased within seven days then customer will receive 0.2% commission.

CASH DEPARTMENT
All physical movement of cash in the bank is made through the cash department. Normally cash department performs following functions:

Bank collects payment of cheques on behalf of its customer within city.

Receipts Payments Act according to any standing instructions Transfer of funds from one account to another Handling of ATM Verification of signatures Posting Handling of prize bonds. CLEARING DEPARTMENT

FUNCTIONS
Accepting transfer delivery and clearing cheques. Arranging receipt of cheques payment. Posting of clearing cheques in the system Maintaining register for inward and outward clearing cheques Prepare the return summary Charges for returns

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Amount collections on drawn checks for members and sub-members of local clearing house

INWARD CLEARING
Cheques and other negotiable instruments (PO, CDR, dividend warrants etc.) drawn on Shakarganj Sugar Mill Ltd. Ltd Church Road branch, Jhang, sent by other banks, constitute the inward clearing of Shakarganj Sugar Mill Ltd. Ltd.

Other points to remember in inward clearing:


We are paying amount of cheque Customers Account will be debited In case of return charges will be Rs. 250

sOUTWARD CLEARING When Cheques are drawn upon other banks of the same city (as Jhang) are presented in Shakarganj Sugar Mill Ltd. to deposit them in the respective payees accounts, these instruments are lodged in outward clearing of Shakarganj Sugar Mill Ltd. . Other points to remember in outward clearing:
We receive payment of cheque Customer account will be credited In case of return charges will be Rs. 50. Return memo will be attached with cheque. PREVILDGE BANKING DEPARTMENT ONLINE BANKING Online banking means that if a person is sitting in one city like Jhang can easily transfer/deposit and withdraw his fund from any other branch of Shakarganj

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Sugar Mill Ltd. in any city or location. For this purpose the person needs to complete the online funds transfer slip, which includes the information of that person and the account to which the transaction is made. If the funds are transfer with in a city no extra charges are made but in case of out of city some charges are applied like

Case
Cash deposit Cash withdraw Funds transfer 320 120 185

Charges (Rs.)

LOCKERS
Shakarganj Sugar Mill Ltd. Ltd offers locker facility to its customers. The application form was filled by the customer as well as specimen signature card (S.S) need to be filled. While fulfilling the form, there are three options regarding the operating of locker, these are Anyone can operate Jointly Either or survivor

In order to get a locker the bank gives two options


On Rent Purchase

Rent
If the person wants to get an account on rent the security fees which need to be deposited is Rs.1175 which is refundable. The monthly charges for different lockers are mentioned below

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Size
Small Medium Large

charges (Rs.)
1300 1800 3200

PURCHASE
If the person want to purchase the locker than the annual charges for different lockers are mentioned below

Size
Small Medium Large

charges (Rs.)
25,000 30,000 45,000

LETTER OF CREDIT (L/C) Letter of credit is a commitment by the buyer bank to make the payment to the exporter bank that it assumes the responsibility of payment if the goods are according to terms & conditions. PARTIES INVOLVED
Importer/buyer/opener Exporter/seller/beneficiary Importer bank/ issuing banks Exporter bank/advising bank/negotiating bank

TYPES OF L/C
IRREVOCABLE L/C Under this L/C, amendments or cancellation of lc can be done with the mutual consent of all the parties involved. CONFIRMED L/C

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A letter which is confirmed by the exporter bank, where it takes the liability of making the payment without consulting the importer bank. SIGHT L/C In this type of L/C, on spot payment is made as the importer bank receives the bill of lading from the exporter. USANCE L/C In this L/C, time period is involved. The importer bank will make payment at defined days after the shipment. The shipment period may be 60, 90 or 120 days.

PERFORMA INVOICE
It is the document which is sent by the exporter to the importer about the description of the goods like quality, quantity and price of goods.

INDENT FORM
The agent (for e.g., USA parent company and its agent in PAKISTAN) authorizes on behalf of its parent company that the goods have been received.

IB8
Its the application of irrevocable l/c. its the legal document which contains terms & conditions of the opening of L/C. It contains the details of country of origin. Amount, date of initiation, date of expiry and the name of the insurance company. Bath parties signed on it.

TRANSPORTATION DOCUMENT There are four types of documents.


Bill of lading Airway bill

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Truck receipt Rail receipt

FORMAT OF L/C
Instruction Mode of transmission Name & address of applicant and beneficiary Total amount with destination Advising bank Partial shipment allowed/ not allowed Transshipment allowed/ not allowed Latest shipment date and expiry date

Place of shipment Destination Tenor Description of goods (ref. Performa invoice/ indent form) Documents required Commercial invoice Certifying country of origin Mode of transmission by sea/air

Marine insurance company Cover note, date of expiry

Packing list required Any additional condition HS code Time allowed for preparation of documents

Instructions regarding bank charges by opener/beneficiary Signature of customer

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% margin Approval of manager Account no. of customer/ phone no. Signature of witnesses Reimbursing bank/ negotiating bank/advising bank Details of charges Signature at the start and at the end

CREDIT DEPARTMENT Credit department performs two basic functions:


Credit Administration Credit Appraisal

CREDIT ADMINISTRATION
The credit department takes the decision about credit sanction after the risk analysis and collects the extended loans at the maturity of loan.

CREDIT APPRAISAL
The credit department reviews their credit policies and all credit proposals. Also credit officer report all the data of his activities to credit division Karachi. Credit division reviews their policies after every six month in the light of this data and also sends the data to State Bank of Pakistan (SBP) to review its policies.

Askari Commercial Bank provides two types of loan that are:


A. Funded Facility Non Funded Facility FUNDED FACILITY

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.

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Running finance Cash finance Term finance Staff finance Trade finance Finance against packing credit Post Shipment Finances I. RUNNING FINANCE It is used to meet the running requirement of the capital. Its the short term finance normally used for a period 1 year in which payment is made at the end of the period. In running finance, Bank transfers a particular amount of loan in customers account from where he withdraws the amount as needed. Markup is charged only on the amount withdrawn not on the whole amount of loan.R.F is used for the purpose of A/R, purchase of raw material, Salaries payable, utility bills payable, Administration expenses, Maintenance, Packaging etc. II. CASH FINANCE

Cash finance is like a running finance but it is extended against the pledged security like inventory or stock and 25% 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. Mark up is charged over the full loan amount and for whole time period of maturity.

III.

TERM FINANCE

The finance in which Mark up is charged on the overall amount of loan whether utilized or not. Its a long term finance normally used for a period of 35yrs.Personal guarantee is required in it. Loan will be issued to the person having 25,000 or above salary. Installment basis pay back.

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CATEGORIES OF TERM FINANCE

Financing Leasing FINANCING


Title/ownership with the customer Bank will pay the amount to customer and customer will purchase the machinery

LEASING
Ownership/ title with the bank. Bank will purchase the car 20% markup charged on the principle amount. Bank-customer account no. required. Tax benefit to customer

IV.

STAFF FINANCE

This facility is provided for the staff of ABL. 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. Trade finance is provided for short time period so it is most suitable for bank. These generate more income for the bank due to greater revolution of money.

V.

TRADE FINANCE
Import related finance

Trade finance is of money. Trade finances are of two types:

Export related finance IMPORT RELATED FINANCE

There are three types of import related finance

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Payment against document Finance against imported merchandize Finance against trust receipt PAYMENT AGAINST DOCUMENT (PAD)

When the bank receives bill of lading and other commercial document from the exporter then bank will pay to reimbursing bank of exporter. If the customer will not receive the document within 7 days then bank issue a letter to the importer and now letter of credit (LC) is converted into absolute liability. The bank gives the credit period to the importer to make the payment which is 90 or 120 days. And now bank will charge the mark up and import service charges from the importer. The reimbursing bank will send all the documents to ACBL and not directly to the importer. FINANCE AGAINST IMPORTED MERCHANDIZE (FIM)

When the importer has no funds to import merchandize then he request the bank letter of credit along with the finance. In PDA the bank is only responsible to make payment but in FIM bank makes payment from its own funds these types of finances have specified rate of mark up and time period. All the value-added expenses like excise duty, port charges etc are charged by the customer as cash security margin.

Finance Against Packing Credit


Finance against packing credit is extended for the preparation of goods when the exporter has confirmed letter of credit from the importer. To improve the economy of Pakistan and to improve the export, SBP introduce special export finance schemes to the exporter at cheaper mark up rate and also offer export rebates. It is of two types:

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B. NON-FUNDED FACILITY

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.

Letter Of Guarantee (LG) Letter Of Credit (LC) LETTER OF GUARANTEE (LG)

Letter of guarantee is contingency liabilities of bank because the funds are not actually involved in it. So they are classified as off balance sheet items. Letter of guaranty is mostly given in case of contract. 25% cash margin is charged and also some collateral is taken. Three beneficiaries of this non-fund based finance are: Government Financial Institutions Others

ACCOUNTS DEPARTMENT ACCOUNTS OFFICER: MR. TAQI FUNCTIONS


Daily activity checking Physical checking of cheques and deposit slips Reconciliation of cheques with ledger Preparation of statement of affairs Weekly schedule program Budget

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IT DEPARTMENT INCHARGE OFFICER: MR. Rao Mujahid FUNCTIONS Managing day to day cash transaction in computer Maintaining customers accounts in computer Receiving all mails from Head Office Fax Keeping ATM in working condition Printing daily reports Receiving IBCA

DETAIL DESCRIPTION OF THE SKILLS ACQUIRED DURING INTERNSHIP


In Shakarganj Sugar Mill Ltd. , working as an internee, I learn much which make me confident to work in any other place as a professional. I started with the accounts department. Mr. Barak Ullah was the in charge officer. He guided me about the functions performed in accounts.

DEPARTMENT NAME: ACCOUNTS


I learnt about how to differentiate among cheques. He assigned me the duty of sorting out of all types of cheques in descending order. I made separate head of current deposits (CDR), saving account (PLS), Askari Special account (ASDA), basic banking account (BBA), Value Plus and Foreign Currency (FCY) according to their account codes and then arranged them in descending order. He gave me an M.O (Main Office) sheet that includes all entries related to head office or inter branch transfer (IBT). All amounts in a specific ledger of specific account should

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be known to accounts in charge. Some amounts in transfer section relates to IBT so they are checked in M.O sheet. Account codes are as follows: Current A/c Saving A/c BBA A/c ASDA Value Plus FCY 01010 01100 01021 01165 01032 0213

Example ACCOUNT NUMBER: 0089-01-165-0001-3

0089 01 165 0001

= = = =

Branch Code Currency Code Asda Account Account Number of the Asda Account Holder

There are three modes of posting in ledger balance MODES OF POSTING Cash Clearing Transfer

Cash includes ATM entries and cheques in cash payments. Clearing includes cheques that branch received from NIFT. Transfer includes transfer of amount from one branch to another or inters branch transfer.

ACCCOUNT OPENING DEPARTMENT


In the Account Opening Department, MR. TAQI was the in charge. Firstly, I have gone through different types of the accounts and the operation of different accounts. I have opened accounts of so many people myself. There are different requirements for different account. I perform following activities:

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Providing account opening form according to the customers requirements (single, joint, partnership etc) Guide the customer about the requirements of the account opening and form filling, Check the forms whether they are correctly completed or not, Preparing checklist and Stamping on the form, Maintaining account opening register, To get the Verification of signature in case of cheque presented before releasing of account opening from SS card is not yet scanned.

REMITTANCE SECTION
This section deals with the transfer of money from one branch to another. Nearly
six to ten draft issued daily from this department. Here I knew how the amount transfers and what the procedure is.

I helped the supervisor in following activities:


Collection of remittances forms Guiding the customers Filling the forms. I was not allowed to do the signatures for final clearance of the instruments. I was also shown the online transfer of credit from one account to another account REMITTANCE FORM CONTAINS THE FOLLOWING INFORMATION Date Amount of PO/DD both in words and figures Name of beneficiary Name of city where this PO/DD will be issued and payable

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Signature and address of applicant

In the remittance section I learn how to issue Demand draft and Pay orders.

DEMAND DRAFT
DD is a written order given by the branch of the bank on behalf of the customer to other branch of the same bank to pay the certain amount to the customer. It is issued outside the local city.

PROCEDURE OF ISSUANCE OF DD
A printed application form is provided for filling in completely and signing by the applicant. After depositing an amount of draft and commission of the bank, duly completed and signed by two authorized officers, then it is handed over the applicant and credit order is dispatched to drawee branch.

PAY ORDER
For this kind of remittance the payer must have the account in the issuing bank. Pay order are more liquid as compared to cheques because cheques may be dishonored while PO cant be dishonored. It is issued within the city.

PROCEDURE FOR ISSUANCE


The party who requires a pay order will get a printed application from the bank. He will fill it and deposits the amount and commission

CLEARING SECTION
In Shakarganj Sugar Mill Ltd. Mr. Burhan Niaz was in charge of that section. I learn following activities while working in that section. When cheque or other instrument is drawn on Shakarganj Sugar Mill Ltd. which is of the other bank, it

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comes in the clearing department. Points to remember while checking a cheque for clearing: Date Amount in words & Figure Clearing stamp with todays date Payees account credited stamp Within city cheque

REASONS FOR REJECTING A CHEQUE The following can be the reasons for returning a cheque:
1) Effects not yet clear: please present again. 2) Not arrange for. 3) Payees endorsement required. 4) Payees endorsement irregular. 5) Refer to drawer. 6) Drawers signature differs. 7) Payees endorsement requires banks guarantee. 8) Alternation requires full signature 9) Cheque is post-dated/stale/ mutilate.(wear and tear) 10)Amount in words and figure differs. 11) Cross cheque must be presented through a bank. 12)Payment stops by the drawer. 13) Payees separate discharge to the bank required. 14) Payees discharge on revenue stamps requires. 15) Not drawn on us. 16) Account close. 17)Insufficient balance

CLEARING STAMPS
Clearing stamp

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It has two parts one is crossing part and other is clearing part Crossing part shows that cheque is the ownership of bank. Clearing part shows that everything is clear and bank has collected payment on behalf of customer Payees A/c Credited This stamp will be stamped on individuals and companies accounts only but if cheque is in the favor of some bank like Shakarganj Sugar Mill Ltd. then stamp will be of cash received. I entered the amount, account no. and Drawers bank in Outward return register and to get the signatures of the customer at the time he collects his cheque from the bank.

CUSTOMER DEALING SECTION


In customer dealing section, my duty was to help in issuing cheque book, ATM cards, lockers, bank statements and TDR to the customer.

CHEQUE BOOK PROCEDURE


The cheque book was issued after the opening of account on the request of customer. The request for cheque book goes to Karachi office after that they issue that book by the name and account number of the account holder. This process almost takes 3 to 4 working days. The request for the cheque book was uploaded online by the bank on NATIONAL INSTITUTIONAL FACILITATION TECHNOLOGIES (NIFT). Procedure of issuing check book is as follows: Form A required Requisition slip required Form B required

Form A
This form is used when first time new check book is issued

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REQUISITION SLIP This slip is required for issuing check book, for those who already used the cheque book now it is lost or finished.

FORM B
In the case when old cheque book or requisition slip is lost then form B is used to issue new cheque book. It is treated as security stationary.

ATM CARD PROCEDURE


After the opening of the bank account, if the person requires the ATM/Debit card then again he needs to fulfill the application for ATM card. After the completion of that form that application was send by bank to Islamabad for approval and for the issuance of debit card. This procedure almost takes from 10 to 15 working days. The amount limit which a person can withdraw each day through debit card is not more than Rs.25000. The annual charges the bank deducts for CLASSIC card is Rs.500 and for GOLD card is Rs.750.

BANK STATEMENT
If a person needs to get the bank statement of his account again for this purpose he needs to complete the request form. The application for statement should be submitted at least 1 day before, in some cases the bank also accommodate their client on urgent basis and print their statement at the same time. The bank statement contains all the details of the account holder which shows the amount and all the details when and where transaction is made.

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If the third party want to receive a bank statement on account of a person who actually hold the account than the third party need to come along with the authority letter issued by the account holder, in which the account holder mention the name of third party with his CNIC number, in order to receive the bank statement.

ASKARI MAHANA BACHAT ACCOUNT (AMBA)


It is also called ASKARI MAHANA BACHAT ACCOUNT (AMBA). In this the account holder can deposit their amount for the fixed period of time. In AMBA,

the profit is given on monthly basis on the basis of amount deposited. For AMBA you must need to have an account with the Shakarganj Sugar Mill Ltd. . In AMBA the bank give two options to the account holder Deposit their amount for 1 year Deposit their amount for 3 years

The amount through which this account can be opened is


Minimum Maximum Rs.50,000 Rs.10,000,000

In this one term is used which is called Rollover, it means if the person tick the option of rollover while opening the AMBA than after the completion of one year the same process will carry on instead of closing that account. Two computerized generated receipt is printed, the very next day after opening the AMBA, one is given to account holder and the second one is maintained by the bank. This receipt is demanded by the bank at the time of closing the AMBA.

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TDR
In TDRs, the profit rate is negotiated that is decided between the manager of the branch and the valued customer. It is given for 1 month, 3 month, and 6 month and so on, the rate was decided on basis of number of days.

LOCKERS
First of all the application form is filled by the customer as well as specimen signature card (S.S). While fulfilling the form, there are three options regarding the operating of locker, these are Anyone can operate Jointly Either or survivor

Any one
In this option if there are more than one person who hold the locker, than any one of them can operate the locker, not all the members are need to be there for the operating of locker.

Jointly
In this option if there is more than one person who holds the locker, than all the members need to come to operate the locker, no individual person can operate the locker.

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Either or survivor
In this option if there is more than one person who holds the locker, and any one of them died than the others have the authority to operate the locker.

. COMMENTS ON THE ORGANIZATION STRUCTRE:


Shakarganj Sugar Mill Ltd. has a good structure and it fulfill the requirements of the organization. It seeks to maintain high standards of services and ethics. Askari treats its employees equally and employee also carries out their responsibilities in a professional way. Shakarganj Sugar Mill Ltd. achieve sustain growth and profitability in all area of the business. It also optimizes use of technology to strengthen the bank structure. It provides strategic solution to strength and weak areas.

9. PLAN OF INTERNSHIP PROGRAM:

a. Brief Introduction of branch: I did my internship in Agriculture and Rural Business Division (ARBD).this department gain strength with improved and efficient delivery and control mechanism for meeting increase demand for credit by customer in easy, accessible and affordable manner. The innovative product for this segment is best rated in the market. This department also achieved further refinement in back office processing including credit initiation, operation, and risk management, in line with the business dynamic and regulatory framework. ARBD remains proactively engaged with its stockholders for aggregation of services and improving and improving life standards of farmers through its distribution network, currently extended to 89 branches in the country.

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Some of the milestones achieved by ARDB during the year include: Won first position in diversification of credit products from MINFAL (GOP) Received certificate of appreciation from SBP regarding development of SBP Crop Loan Insurance Framework. Contributed in developing SBP guidelines for Islamic agriculture financing, livestock financing, small farmer group financing. Coordinated with Federal Government for the development of Shaheed Benazir Bhutto Card, Asian Development Bank funded agribusiness development & diversification project.

Starting and ending date of internship:

March 16, 2012 to April 06, 2012.

Name of department and duration of training:

I got training in MIS & Insurance Departments and duration of my training is 3 month. TRAINING PROGRAM
LEARNING AS A STUDENT INTERN There are following learning points for me in the bank.

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First week Duties


In my first week in Askari Commercial Bank commercial bank, they assigned me work in Account Opening Department.Mr Bilal Mehmood trained me very nicely and I learned lot of things in this department. He told me different accounts names and their codes. How to open the account. New Computerized national identity card is must for opening of new account. For current account 10,000 and for saving 5,000 are required. What are the necessary requirements of different accounts to be opened? Other activities are How to fill the deposit Slip if anyone wants to transfer cash in the account or online transfer How to fill the different accounts Form How to fill the voucher for issuing of the Cheque Book for the first time How to fill the requisition slip for the second time issuance How to issue the Cheque Book How to enter it in the register What are the procedures for the ATM card

Accomplishments
I m fully trained in this job how to open the different accounts ,how to issue the cheque book and enter it in the register and how to transfer the amount through cash or cheque to an account and how to issue a Debit Card.

Second Week
In the Second Week they assigned me work in Clearing Department .Miss Asia Batool trained me very nicely and I learned lot of things in this department.

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Duties
There are two types of clearing. 1. I/W (Inward clearing) 2. O/W (Outward clearing) In this week I entered the cheques lodged for inward clearing in clearing register as their cheque number account holder name cheque amount and bank name amount to be paid. Secondly in this week I prepared (O/W) clearing for next day. Same as entered cheque number account holder name amount and Bank name. In this week I also entered cheque return in cheque return register and put cheque return slip on cheque.

Accomplishments
I am full trained now in this particular job. How to fill cheque return slip? How to enter in I/W, O/W clearing register.

Third Week Duties


In third week I perform following tasks relating to the banking system. 1. IBC (Inter bills clearing) 2. OBC In this week I worked for IBC (Inter bills clearing). IBC mean cheques lodged for clearing From other city. I entered these cheques in IBC register if it is ABL cheque then Miss Asia Batool cleared or return this cheque and if it is cheque of other bank then it is again entered in O/W clearing registered and lodged next day for clearing. Secondly in this week I prepared OBC, filling of OBC slip as cheque number their amount OBC number and branch name.

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Accomplishments
In this week I repeatedly performed this job and now I am fully trained in this job.

Fourth Week
In Fourth week they assign me work for Remittances Demand draft and Pay order preparation.

Duties
Demand draft is for payment outside of city and pay order for local payment. It is a secure source of payment. There are no charges for Pay order while other banks charge for this service so it is an advantage going to Shakarganj Sugar Mill Ltd. Ltd to attract customers.

Accomplishments
In this week I repeatedly perform the jobs and I am fully trained in such type of operations i.e. to make the DD, Pay order and mark the Charges if Customer is not account holder of the Bank then 255 Rs commission of the Bank.

Fifth Week Duties


In this week I worked in Accounts and Cash Department. In fifth week they assign me work in cash department. In cash department I learned about Receipts and Payments and about how to receipt cash and how to enter it in computer. In Accounts Department how to sort the Vouchers and preparation of Salaries

Accomplishments
I am fully trained in this job i.e. to check that all the vouchers are scrutinized and matched with the activity

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Sixth Week Duties


In Sixth Week I worked in Foreign Exchange and in Credit Department. They told me brief introduction about import and Export. Necessary Requirement about the Letter of Credit .What Documents are required for Import and Export Secondly in this week I learned about Advances from credit manager Mr. Ateeq. What are requirements for loan? It is a procedure that takes many days

Accomplishments:
I in this week I m fully Trained in these jobs

11. Structure of Finance Department


Departmental Hierarchy

FIRST LEVEL

Senior Agricultural credit officer

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OG1

Second Level

Agricultural credit officer

OG2

Third Level

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Field Credit Officer III

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Structure and functions of Accounts/Finance Department:

Director Finance
Chief Financial Officer

Manager Audit AM Audit Executive Audit

Manager Finance AM Finance Executive Finance

Manager Credit AM Credit Executive Credit

Finance and Accounts Operations: The three core functions of the Finance Department are to: provide strategic financial support for business and operational planning provide day-to-day financial services to the University, its departments, students

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meet external and internal financial reporting requirements. In addition, we maintain the University's risk register and manage its insurance arrangements.

12.Functions of Finance Department


Accounting system of the organization:

1.Fully Computer Based Accounting system


2.Reliable Electronic data is used in decision making. 3.Generation of funds from Sales of Shares and Fixed Deposits from Customers. 4.High rate of Interest on Loan and Different Services good Sources of funds. 5.Allocation of funds by providing Financial Services. 6.Double Entry Book keeping System 7.Foolproof

Finance system of the Shakarganj Sugar Mill Ltd. :


Based upon borrowing

Based upon lending.

Use of electronic data in decision making:


Fully Computer Based Accounting system Reliable Electronic data is used indecision making.

Mobilization of funds: 1. Advertisements 2. Sales Promotion Generation of funds 1. Sales of Shares


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2. Fixed Deposits from Customers


SOURCE OF FUNDS:
The bank finance policy is acquiring funds from the following sources: Deposits of account holders. Interest on advances and loans granted to the borrowers. Income and commission from the services provided by the bank. Bank opens various types of accounts for its customers Services are provided for earning.

Interest income and commission bank providing the services to its customer. Fixed Deposits from Customer. Sales of Shares.

USE OF FUNDS:
After the acquisition of the funds their acquisition becomes necessary. The bank seeks the best way for making investment to get more profit with the maximum security. The bank has an investment portfolio in which it allocate its funds for crediting to borrowers, investment in the stock market, investment in the real estate property etc. for the allocation of funds a bank has to follow some banking policies and the prudential regulations of SBP these are: A bank has to maintain liquidity with state bank of Pakistan, i.e. 25 %of its total deposits. A bank cannot invest all of its funds otherwise it will be difficult to meet urgent needs.

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A substantial part of funds is received from interest on loans and advances. Before granting a loan the bank analyzes and observes the borrower and conduct a complete ratio analysis. Bank prepares credit line for this purpose the major thing is granting an advance is the security offered by the borrower and its actual market value.

Allocation of funds 1. Lending to Financial Institutions 2. Lending people on interest E.g. Loans, Car Finance, House Finance.

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14.SWOT ANALYSIS:

SWOT Analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective.

SWOT (Strength, Weaknesses, Opportunities & Threats) analysis of ACBL is described below: Strength:

Shakarganj Sugar Mill Ltd. Ltd has got a well-developed on-line system in most of its branches. Remittance Department is working very efficiently in transferring the funds of people due to this system.

The bank has also started ATM facility in most of its branches. 24-hour banking is new trend in Pakistan and Shakarganj Sugar Mill Ltd. Ltd has also taken apart in this trend.

One distinctive feature of the bank is that it is the only bank working for the welfare of army officers, which was established by Army Welfare Trust.

The productivity of the bank is very good. Bank is providing a high quality service to its customers.

Shakarganj Sugar Mill Ltd. Ltd have strength that most of the imports & exports which are done in Jhang are handle by Shakarganj Sugar Mill Ltd. Ltd Jhang.

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ABL has a well-knitted and adequately equipped branch networking system that efficiently covers both the domestic and international markets.

Etical concern and public image. Strong Customer relationship management Vast & Integrated Network. The bank has the largest ATM Network cross the country. The customers of ACBL withdraw access their funds any time at all the ATM Sites with ASKCASH Logo.

Weaknesses:

Shakarganj Sugar Mill Ltd. Ltd has lesser number of branches as compared to many other branches. Due to this problem, army officers can not avail the benefits of their own bank.

The human resource department is not performing the function of selection and recruitment very effectively. Selection process is not on merit due to which competent persons cannot be selected.

Bank is not introducing new products and new saying schemes. Bank should boost the product development and increase the range of facilities offered for customers.

Bank is weak in its credit management. Bank should lend to very sound parties and increase its payment rate.

Low number of branches. Lack of sound corporate culture. Low market value of the banks stock.

ABL has lesser number of branches as compared to many other branches. Due to this problem, army officers can not avail the benefits of their own bank.

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Bank is weak in its credit management. Bank should lend to very sound parties and increase its payment rate.

Opportunities:

Govt. is taking very bold steps to promote IT in Pakistan. Shakarganj Sugar Mill Ltd. Ltd has an opportunity to improve in technology.

Stock exchange is very volatile and takes immediate effect. So, in the time of crises, conservative investors return to saving deposits.

Shakarganj Sugar Mill Ltd. Ltd is surrounded by many competitors. It has an opportunity to do aggressive marketing to increase its business.

Entering new market segments. Customer feed back on different products and accounts has really improved the bank performance and encouraged the atmosphere for other future policies.

ABL also has an opportunity to expend its new technological advancement like, Tele banking and Internet banking facilities in order to serve the customers more efficiently.

A large amount of foreign investment is attracted

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Sharp increase in export/import Govt. is taking very bold steps to promote IT in Pakistan. ABL has an opportunity to improve in technology. Stock exchange is very volatile and takes immediate effect. So, in the time of crises, conservative investors return to saving deposits. ABL is surrounded by many competitors. It has an opportunity to do aggressive marketing to increase its business and attract higher customers.

Threats:

Shakarganj Sugar Mill Ltd. Ltd has many competitors, which are continuously increasing its products and marketing aggressively. It may cause its customers to shift to competitors.

Increase in competition due to increasing number of foreign banks offering highly specialized and attractive services.

Growing global technological advancements and adaptation of modern style of management in banking sector. Extensive promotional campaigns run by competitors. ABL is giving higher rate of return to their clients on various certificates like, Defense saving certificate etc. Being a private commercial bank it should earn more than that of nationalized banks.

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High employee turnover High charges Less attractive rate of return Stiff competition Some other banks have competent taskforce, which is also a threat for ABL. Because human resource is the most valuable resource. Pakistan India relations often create a war danger. This chance of war may cause army officer and their families to increase the frequency of withdrawals, which would decrease deposits.
nk Ltd. Because human resource is the most valuable resource.

Pakistan India relations often create a war danger. This chance of war may cause army officer and their families to increase the frequency of withdrawals, which would decrease deposits.

In Multan Imports & Exports business are done on seasonal basis. Which effect the whole business of ACBL Multan

Conclusion:
The Shakarganj Sugar Mill Ltd. showed good and marked performance during year 2011. During this year bank showed excellent improvement over the previous year although nonconductive business conditions prevalent most of 2011. The bank was able to wisely manage the risk and returns although credit demand and continued stress on banking margins. Also Shakarganj Sugar Mill Ltd. is able to drive significant gains through active management of money market, equity and debt management portfolios. Key elements of strategies of Shakarganj Sugar Mill Ltd. are consolidation of business and operations. During 2011 greater focus on strengthening policies, workflows, process and controls. A technology transformation show that the bank has embarked upon is an advance and vast

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stage of implementation. In near future benefits are expected in the form of improvement in service quality, customer offering, internal controls that will further reinforce the bank capabilities and readiness for future challenges. Financially operating profit of the bank is almost same level of the last year. Share holders funds and earning per share are increased during this year. The bank capital adequacy ratio stood at a comfortable level. Islamic banking operation of the banks are now become the top players and it is sure that Islamic Banking will continue to maintain its rate of growth. The agricultural and rural department gain great significance by facilitating farmers with finance. So I conclude that Shakarganj Sugar Mill Ltd. has a good and successful present and future which assures that shareholders maximization of wealth.

RECOMMENDATIONS
A department should be established that collects feed backs of the Charges should be decrease in providing services to the customer that will Marketing departments efforts to market and introduce its product should There should be proper training for the new employees. Job rotation from one job to another is a big hurdle in the way of getting

customers and as well as general public. result into the increase in the customers. be improved.

experience. Employees have known how about how to work but not master in one work. Employees are not satisfied with their jobs. The bank should take steps to minimize it through different incentives for the employees.

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The bank may choose to make its existing products distinctive or to

introduce new products. It is often easier to benefit from adverse changes made by other banks than to attract customers by innovations. Efficiency in services should be improved to serve and prevent customers from waiting for too long e.g. by increasing the number of qualified workers or increase in computers in the bank.

New machinery should be purchased in order to increase the efficiency and lower

the maintenance cost. Standardized machinery is also recommended ( personal computers)

Emphasizing on excellent services to its customers such as standardized products

and timely fulfillment without distraction.

Adapt to the rapid, social, economic and technological changes.

Hiring of well-trained / experienced staff will add in the efficiency of the facility.

In the banking sector, marketing is considered to be of significant importance while going into the international market. Some of the marketing promotion activities may include: Emphasis on image development and acquaintance across individual private sector. Use of catalog marketing techniques. Establishment of website that would be user friendly for marketing.

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ORGANOGRAM BOARD OF DIRECTORS Executive Committee President and Chief Executive Corp. Banking & Fin. Inst. Group International Treasury Corporate and Merchant Banking Operating and credit group Credit Electronic Technology Systems and Operations Data Reporting Legal Affairs
campus)
79

Internal Audit

Regions Rawalpi ndi/Isla mabad North Lahore East South I South II West

Retail Banking Group Asset Products Investment products

Credit Cards Planning and Corporate affairs Human Resource Finance

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Functions of Shakarganj Sugar Mill Ltd. Ltd:


ACBL is a commercial bank, which transacts the business of banking in accordance with the provisions of BCO, 1962. Section 7 of the Act authorizes banks to engage in the prescribed form of business. In the light of this section ACBLs functions can be categorized as under: Agency services. General utility services.

Underwriting of loans raised by the government Providing specialized services to customers

Accepting deposits

Mission Statement: As it is said that an organizations culture, products, services, employees, their attitude, philosophy, self-concept, markets and environment throws light on the corporate mission, so one of the business executives at the bank, based on his personal observation and judgment, carved the following mission of The Askari Commercial Bank Limited as

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The mission statement of the bank is: To be the leading private sector bank in Pakistan with an international presence,
delivering quality services through innovative technology and effective resource management in a modern and progressive organization culture of meritocracy, maintaining high ethical and professional standards, while providing enhanced value to all their stakeholders, and contributing to society

Core Values:
We understand that our commitment to satisfy customers needs must be fulfilled within a professional and ethical framework. We subscribe to a culture of high ethical standards, based on the development of right attitudes. We believe in our 'core values' as the essential and enduring tenets of our organization - the very small set of guiding principles that have a profound impact on how everyone in the organization thinks and acts. They have an intrinsic value for us and bear significant importance to all our employees. They are the few extremely powerful guiding principles; the soul of the organization - the values that guide all our actions.

The intrinsic values, which are the corner stones of our corporate behavior, are: Commitment Integrity Fairness Team-work Service

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Vision: To be the Bank of first choice CORPORATE PHILOSOPHY :


From knowing our customers requirements to understanding employee needs, from utilizing modern technology to making responsible social contributions, from enhancing stake-holders value to practising corporate ethics.... We are continuously and consistently striving to address newer challenges with a single motivation: the power to inspire and be inspired

OBJECTIVES:
Deliver solutions that meet customer financial needs. Build and sustain a high performance culture. Build trusted relationships with all stakeholders. Build and manage the Banks portfolio of business to achieve strong and Sustainable shareholder return. Create and leverage strategic assets and capabilities for competitive advantage. To facilitate the bank with modern banking technique To accelerate commercial activities and capture large market share.

Code of Business Principles:


Our Code of Business Principles is to: Deliver solutions that meet customers financial needs Build and sustain a high performance culture Build trusted relationships with all stakeholders Build and manage the Banks portfolio of businesses to achieve strong and sustainable shareholder returns Create and leverage strategic assets and capabilities for competitive advantage

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Corporate Objectives:
To achieve sustained growth and profitability in all areas of business. To build and sustain a high performance culture, with a continuous improvement focus. To develop a customerservice oriented culture with special emphasis on customer care and convenience. To build an enabling environment, where employees are motivated to contribute to their full potential. To effectively manage and mitigate all kinds of risks inherent in the banking business. To optimize use of technology to ensure costeffective operations, strengthening of controls, efficient management information system, enhanced delivery capability, and high service standards.

To manage the Banks portfolio of businesses to achieve strong and sustainable shareholder returns and to continuously build shareholder value. To deliver timely solutions that best meets the customers financial needs. To explore new avenues for growth and profitability.

Strategic Planning:
To comprehensively plan for the future to ensure sustained growth and profitability. To facilitate alignment of the Vision, Mission, Corporate Objectives with the business. To provide strategic initiatives and solutions for projects, products, policies and Procedures.

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To provide strategic solutions to strengthen weak areas and to counter threats to profits.

To identify strategic initiatives and opportunities for profit. To create and leverage strategic assets and capabilities for competitive advantage.

Code of Ethics and Conduct:


Shakarganj Sugar Mill Ltd. seeks to maintain high standards of service and ethics enabling it to be perceived as impartial, ethical and independent. In addition to the general guidelines, the Following are the salient features of The Banks code of ethics and conduct. Presence of a corporate culture that seeks to create an environment where all employees are treated equitably and with respect. Employees must carry out their responsibilities in a professional manner at all times. They must act in a prudent manner and must avoid situations that could reflect unfavorably on themselves, the Bank or its customers Employees must commit to the continued development of the service culture in which the Bank consistently seeks to exceed customers expectations. Fairness, Truthfulness and Transparency govern our customer relationships in determining the transactional terms, conditions, rights and obligations.

Employees must safeguard confidential information which may come to their possession during the discharge of their responsibilities. Respect for customers confidential matters, merits the same care as does the protection of the Banks Own affairs or other interests.

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Employees must ensure that know your customer principles are adhered to by obtaining sufficient information about the customers to reasonably satisfy ourselves as to their reputation, standing and the nature of their business activities.

Employees must avoid circumstances in which their personal interest conflicts, or may appear to conflict, with the interest of the Bank or its customers. Employees must never use their position in the Bank to obtain personal advantage or gain.

Employees must not enter into an agreement, understanding or arrangement with any competitor with respect to pricing of services, profit rates and / or marketing policies, which may adversely affect the Banks business.

Employees must not accept gifts, business entertainment or other benefits from a customer or a supplier / vendor, which appear or may appear to compromise commercial or business relationship.

Employees must remain alert and vigilant with respect to frauds, thefts or illegal activities committed within the Bank premises.

Market standing of Shakarganj Sugar Mill Ltd. :


ACBL have A1+, the highest possible credit rating, for short term obligations, and their long term rating stands at AA+ by PACRA (Pakistan credit rating agency). The rating specifies a very high credit quality and very strong capacity for timely payment of financial commitments. Definitions by Pakistan Credit Rating Agency Limited (PACRA): AA Very high credit quality. AA ratings denote a very low expectation of credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

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Obligations supported by the highest capacity for timely repayment.

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ORGANIZATIONAL STRUCTURE Board of Directors Lt. Gen. Waseem Ahmed Ashraf Lt. Gen. (R) Zarrar Azim Committee Mr. Shaharyar Ahmad Executive Brig (R) Muhammad Shiraz Baig Brig (R) Asmat Ullah Khan Niazi Mr. Muhammad Najam Ali Mr. Muhammad Afzal Munif Mr. Tariq lqbal Khan Company Secretary Mr. Saleem Anwar Audit Committee Brig (R) Asmat Ullah Khan Niazi
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Chairman Executive

Chairman

President & Chief Director Director Director Director Director (NIT Nominee)

Chairman

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Brig (R) Muhammad Shiraz Baig Mr. Kashif Mateen Ansari Auditors A.F.Ferguson & Co. Legal Advisors Rizvi, Isa, Afridi & Angell Shariah advisor Dr. Muhammad Tahir Mansoori

Member

Member

Chartered Accountants

MANAGEMENT MAIN OFFICES Registered \Head Office AWT Plaza, the MALL P.O. BOX. NO: 1080 Rawalpindi: 46000
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Pakistan. Tel: 92-51-9063000 Fax: 92-51-9272455 E-mail:Webmaster@Askaribank.com.pk Registrar\share transfer office THK Associate (PVT) Limited Ground Floor. State Life Building 3 Dr.Ziauddin Ahmad Road, Karachi 75530 P.O. box 8533, Karachi. Wholesale Bank Branch, Bahrain

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ORGANOGRAM BOARD OF DIRECTORS Executive Committee President and Chief Executive Corp. Banking & Fin. Inst. Group International Treasury Corporate and Merchant Banking Operating and credit group Credit Electronic Technology Systems and Operations Data Reporting Legal Affairs Retail Banking Group Asset Products Investment products Internal Audit

Regions Rawalpi ndi/Isla mabad North Lahore East South I South II

Credit Cards Planning and Corporate affairs Human Resource Finance

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HIERARCHY AT THE TOWNSHIP BRANCH

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BRANCH BRANCH MANAGER MANAGER

FOREIGN FOREIGN EXCHANGE\T EXCHANGE\T RADE DEPT RADE DEPT OPERATIONS OPERATIONS MANAGER MANAGER CUSTOMER CUSTOMER SERVICE SERVICE CLEARING CLEARING

CREDIT CREDIT DEPT DEPT CASH CASH DEPARTMENT DEPARTMENT NT NT REMITT REMITT ANCES ANCES

INCHARGE GENERAL INCHARGE GENERAL BANKING

BANKING

ACCOUNT ACCOUNT OPENING OPENING

NON-CLERICAL STAFF NON-CLERICAL STAFF

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FUNCTIONS OF ACBL There are following functions that Shakarganj Sugar Mill Ltd. performs:
Acceptance of deposits Advancing of loans Agency services General utility services Investment Overdraft facility Transfer of money Creation of credit Facilitates foreign trade Executor of the standing orders Acting as a trust

Chapter: 2
MANAGEMENT SYSTEM Organizational Chart
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Corporate Profile Management Hierarchy Policy Formation process Managerial Policies

Organizational Chart

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Corporate Profile:
Board of directors
Lt. Gen. Javed Zia Chairman Lt. Gen. (R) Imtiaz Hussain Maj. Gen. (R) Saeed Ahmed Khan Mr. Zafar Alam Khan Sumbal Mr. Muhammad Riyazul Haque Mr. Shahid Mahmud Mr. Ali Noormahomed Rattansey, FCA Dr. Bashir Ahmad Khan Mr. Tariq Iqbal Khan, FCA Mr. M. R. Mehkari

Audit Commit
Dr. Bashir Ahmad Khan Chairman Mr. Ali Noormahomed Rattansey, FCA
Mr. Tariq Iqbal Khan, FCA

Company secretary
Mr. M. A. Ghazali Marghoob, FCA

Chief financial officer:


Mr. Saleem Anwar, FCA.

Auditors:
AF. Ferguson & Co Chartered Accountants

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Rizvi, Isa, Afridi & Angell

Shariah advisors
Dr. Muhammad Tahir Mansoori Legal Advisors

Corporate Information

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Lt. Gen. Imtiaz Hussain (HIM)


Chairman

Lt. Gen. (R) Zarrar Azim

Chairman Executive Committee

President

Mr. Shaharyar Ahmad

& Chief Executive

Brig (R) Muhammad Shiraz Baig


Director

Brig (R) Asmat Ullah Khan Niazi


Director

Brig (R) Muhammad Bashir Baz


Director

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Director

Mahmood Chaudhari

Audit Committee

Brig (R) Asmat Ullah Khan Niazi Chairman Brig (R) Muhammad Shiraz Baig Member Mr. Kashif Mateen Ansari Auditors Member

A.F.Ferguson & Co.

Chartered Accountants

Legal Advisors Rizvi, Isa, Afridi & Angell


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Executive Profiles Mr. Agha Ali Imam:


Senior Executive Vice President
Mr Imam is Group Head Of Consumer Banking Group. He oversees all aspects of the Bank's Consumer Business including industry leading sales production team and over Rs 12,000,000,000 consumer servicing portfolio.

Mr Imam joined Consumer Banking in 2002 where he led the organic growth of the Division and the successful integration of Retail Banking. He also engineered numerous successful growth and operational efficiency initiatives that resulted in notable Improvement in loan processing time, deeper mortgage product penetration among Retail Bank and commercial customers and a significant increase in market share.

M.R Mehkari:
Senior Executive Vice President

Suhail Ahmad Rizvi:


Executive Vice President
Mr. Rizvi is a graduate of F. C. College, Lahore and did his masters in Business Administration (MBA) from University of Sterling Scotland, U.K. He has attended a Number of courses in Credits, Foreign Trade and Correspondent Banking locally and abroad

Mr. Nazimuddin A. Chaturbhai:


Senior Executive Vice President

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Mr. Nazim started his career almost 40 years back with UBL Karachi, relocating to UBL Abu Dhabi in 1972. Prior to joining Shakarganj Sugar Mill Ltd. , he was associated with United Arab Bank, Abu Dhabi & Dubai (affiliated with Societe Generale France). He worked with First International Investment Bank (managed by Amercian Express Bank). He performed at senior positions and was responsible for Funds Mobilization, Business Development, Liquidity Management and Credit OperationAcademically he is Masters in Business Administration from CUC, USA and qualified DAIBP and IBL-I, UK. His schooling was nursed from Saint Patricks High SchooHe had attended number of local and foreign, Seminars, Sessions, and Courses on Bank Operations, Economics, Leadership and Change Management..

Malik Asad Ali:


Noon, Executive Vice President Mr. Asad Ali Noon joined Shakarganj Sugar Mill Ltd. in July 2006 as Executive Vice President / Regional General Manager for Rawalpindi/Islamabad. Presently he is working as Regional General Manager for North Region. Mr. Noon started his professional career in 1979 with BCCI as Manager Operations in an Offshore Banking Branch after attending extensive Training at their Head Office at London City. Later on, his services were utilized at various International Positions by BCCI. In 1992, he joined Prime Commercial Bank Limited and served as Incharge / Group Vice President. Prior to joining Shakarganj Sugar Mill Ltd. , he has also served American Express Bank & Union Bank at senior level positions.

Mr. Tahir Aziz:


Executive Vice President

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Mr. Tahir Aziz joined Shakarganj Sugar Mill Ltd. in 2005 and is currently holds overall responsibility for the Bank's Corporate & Investment Banking Group - that provides all requisite products and services to the Bank's corporate & institutional clients. Prior to joining Shakarganj Sugar Mill Ltd. , Mr. Aziz was working at Union Bank, as Head of Investment Banking, where he was responsible for successfully setting up investment banking as a new business for the bank. Prior to that Mr. Aziz was wit ANZ Banking Group, where he worked on a number of large ticket-transactions spanning the power, telecom, infrastructure, textiles, refining sector etc. Mr. Aziz was also a member of the Risk Integration team that consisted of 5-memebrs selected from the ANZ Banking Group worldwide, to develop proprietary risk models to be used in the bank globally for its Project Finance and other large-ticket corporate loans. Mr. Aziz holds an MBA from the Lahore University of Management Sciences and a Bachelors' in Computer Science and Physics from Grinnell College, USA.

Organizational Hierarchy President (CEO)

Senior Executive Vice President

Executive Vice President

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Vice President

Assistant Vice President

Branch Manager

Assistant Manager

Operations Manager

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Officers Grade I, II, III

Cashier Typist & Clerks Assistant

Clerical Staff

Non-Clerical Staff

Guards &

Managerial Policies:
A. Financial policies B. Procurement policies C. Marketing policies D. Promotional policies E. Lending policies F. Personal policies

FINANCIAL POLICIES
The financial policies of any bank are the most important policies through which the whole banking activity is conducted. These policies are primarily conducted on: Source of funds Use of funds

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The bank finance policy is acquiring funds from the following sources: Deposits of account holders. Interest on advances and loans granted to the borrowers. Income and commission from the services provided by the bank.

Bank opens various types of accounts for its customers Services are provided for earning.

Interest income and commission bank providing the services to its customer.

USE OF FUNDS:
After the acquisition of the funds their acquisition becomes necessary. The bank seeks the best way for making investment to get more profit with the maximum security. The bank has an investment portfolio in which it allocate its funds for crediting to borrowers, investment in the stock market, investment in the real estate property etc. for the allocation of funds a bank has to follow some banking policies and the prudential regulations of SBP these are: A bank has to maintain liquidity with state bank of Pakistan, i.e. 25 %of its total deposits. A bank cannot invest all of its funds otherwise it will be difficult to meet urgent needs. A substantial part of funds is received from interest on loans and advances. Before granting a loan the bank analyzes and observes the borrower and conduct a complete ratio analysis. Bank prepares credit line for this purpose the major thing is granting an advance is the security offered by the borrower and its actual market value.

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Procurement policies are more concerned with manufacturing organizations. In bank industry that is service industry procurement means the procurement of funds from various sources such as deposits. It involves attracting and holding the funds of the depositors. After the acquisition of funds, the bank invest the acquire funds. One alternative is to lend its money and earned interest markup or invest in govt. securities etc. as already mentioned in the above paragraph the major sources of funds for a bank are the deposit of the general and the other sources of income includes interest or markup charges received for various services offered by the bank to its clients. A bank tries to attract maximum no. Of accounts so that it can increase its deposits and these lending ability. In order to get maximum no. of accounts the staff of the bank must

be efficient as compared to the other banks and the manager of the branch must take personal interest in attracting deposits. Good quality of the service is the key to success.

MARKETING POLICIES
Marketing policies are also one of the most important policies because they are related to the growth of the organization. Marketing for a bank would mean:

1. Creation of new product and services. 2. The bank marketing must be consumer oriented. Following are the marketing policies of the ACBL. a. Keeping the track of latest development in the world and incorporating the latest and most modern equipment to make the banking procedures simple and easy for the customers. b. Development of products for the customers.

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c. Giving good services and maintaining good relations with the customers. These policies can be implemented by providing the right product and service to the customer at the right place, at the right time, at the right price. It is necessary for the managers to keep in touch with consumers, observe their needs and develop products, which meet their needs.

PROMOTIONAL POLICIES
Public relation and advertising has assumed a great importance in the modern banking business. As for as promotional activities are concerned, the main objective of the bank is to inform the existing clients and other people about its new products or change in the existing services. ACBL establishes its purpose through:

1. Direct contact with customers. 2. Relation with business organizations. 3. Community relations.

LENDING POLICIES
Every bank has its own lending policies except for those, which are common for all the banks, i.e. the policies, which are imposed on all the commercial banks by the SBP, are known as prudential regulations. The lending policies of ACBL are as follows:

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1. The bank only invests in those sound and viable projects, which have good rate of return. 2. Bank prefers to advance loan to their account holders. 3. Loan is given to reliable person only. 4. No political loan is sanctioned by bank.

5.

Any account holder can apply for running finance or demand finance. The manger appraises the past record of account holder and his credit worthiness. If he finds any thing wrong he can refuse to sanction the amount.

6.

The bank while taking security prefers govt. Securities to shares.

7. It also advances working capital loans.

PERSONAL POLICIES
Personal policies have an important role in the success of an any organization. ACBL have its proper personal policies. Good personal policies motivate the employees towards hardworking. Following are the main personal policies of ACBL: 1. Selection of employees on merit 2. Selection of capable employees. 3. Attractive salary package for motivation of employees. 4. To train and develop the future management of the bank. 5. Every employee must have certain set of clearly defined duties 6. Effective communication at al levels of the organization.

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Chapter: 3
MARKETING MIX
Product Price Place Promotion Publicity
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COMPANY MARKETING MIX


The concept of marketing mix is very important in the business literature. Marketing mix is a combination of a number of marketing elements according to a market situation. If a business enterprise rationally blends the elements of marketing into a program of mix, then it competes, stays and earns profit in the market. In case, the integration of the various elements of marketing is defective, the firm cannot fight out its rivals in the market and ultimately suffers losses.

Marketing mix is defined as: The set of controllable tactical marketing tools that the firm

blends to produce in response to wants in the target market.


The various elements of marketing mix are as follows; Products Price Place Promotion Marketers use numerous tools to elicit desired responses from their target market. These tools constitute a market mix. Four Ps Product Price Place Promotion Four Cs Customer needs and wants Cost to the customers Convenience Communication

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Now let us discuss the marketing mix of ASKARI COMMERCIAL BANK

LIMITED.
While successfully penetrating the key domestic markets through strategic expansion and business diversification, we remain alive to the challenges emanating from the developments in the global financial markets; the opportunities and threats engendered by greater deregulation, and increased customer expectations. These provide us the impetus to make the best use of available resources, including modern technology, to meet the challenges ahead. Historically, Askaris core marketing focus for its asset base has been the middle and upper middle business houses (including wholesales and manufacturers) operating in the large urban centers of Pakistan, which are primarily oriented towards foreign trade. This segment contributes significant revenues to the Bank. The liability side remains focused on the middle and upper middle class, retired and serving government and armed forces personnel, and mid size business houses. Benefiting from the banks growing balance sheet size, this division is now gaining momentum and our long term aim is to develop it into an independent strategic business unit (SBU). This would enable the bank to acquire, develop and retain specialized abilities, and enhance our focus on serving the emerging needs of the corporate clients. With the branch network of 46 and further expected increase of 18 during 2003, the ATMs facility and Internet Banking. Shakarganj Sugar Mill Ltd. s reach is ever increasing. In recognition of this reach, we set up Retail Banking Group in July 2000, dedicated to serving the urban consumer market. Askari is committed to aggressively market this segment. The strategy is to provide our customers with a banker of innovative products to meet their varying needs. In view of the fast changing market conditions and the narrowing of traditional lucrative margins on loans, Shakarganj Sugar Mill Ltd. revamping of the now commits itself to seek out new opportunities and make its existing operations more efficient. This is evident from

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Treasury that is being geared to provide innovative products and efficient services to our clients. In the process, we hope to improve overall margins on the surplus liquidity available with the Treasury. Despite the falling interest rates, which compelled people to divert their investments to the share market and property, our deposits increased from PKR 41 billion in 2001? Our operating Profit (before provisions) for the year, stood at PKR 1,595 million as at December 31, 2002, while the figure for last year was PKR 1,291 million. Although the interest margins were greatly squeezed during the year 2002, especially in the second half, we succeeded in compensating for the reduced margins by a substantial increase in volumes. The Board and Management are steering towards contemporary management design. This is evident from the conception of the new division for Planning and Corporate Affairs. The division was set up to play a proactive role in pursuing corporate and organizational development, giving strategic direction to the bank and looking out for new growth avenues. Askari is one of the first Pakistani banks to develop such a dedicated function with a high focus on the future. During the first quarter of 2003, the bank plans to operationally an Offshore Banking Unit (OBU) in Bahrain. In the near future, Shakarganj Sugar Mill Ltd. also plans to launch some new consumer products, developed and designed by its Retail Banking Group. This will include debit cards, prepaid cards and electronic billing systems. The bank plans to enhance its ATMs and Internet banking services with new features like inter branch funds transfer, and the payment of utility bills. We plan to setup a Call Center and Date Warehouse to enhance the timeliness and quality of our services. Enhancements are also planned for the banking software so that funtions like Trade Finance, SWIFT messages, and credit approvals can be integrated into the core banking system. The bank is also in the process of obtaining a new IT system for its Treasury.

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Realizing that Assets make things possible, people make things happen. Askari plans to reemphasize its focus on its human resource. The bank will try to build the organization from within, giving special emphasis on the quality of its human resource. Our emphasis on technology is evident from the products that we are developing. We understand and are committed to enhancing our technology not just to keep abreast with the modern developments but also to retain our position as leaders in this field Our motivation is driven by one single factor Providing customer satisfaction

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PRODUCTS
Shakarganj Sugar Mill Ltd. presents you an entire range of products... whether you are looking for high returns on your deposits, lockers for your valuables, liquidity for your business needs, loans to meet an emergency cash need, or financing for the purchase of an automobile, we have the solutions to your questions. Policies Regarding Product Intangibility, inseparability and high perish ability are a significant product planning challenge in service marketing. So to overcome these challenges the service industry has to adopt various strategies. We would discuss these strategies in context of ACBL.

ACBL emphasis is on the benefit the service offers rather than on the service
itself. For example the e-statement service emphasis is on the customers convenience, easiness and advantage than on the service itself.

For product promotion the use of visualization technique,


association, physical presentation and documentation are used. On every brochure of ACBL product one sees an image. For example the High Yield saving account brochure shows an image of wheat plant. What does it reflects or communicates with the customer? It instantly gives the idea That something very rewarding, giving higher returns, a worthy investment etc. so the customer mind instantly visualizes, associates the service with something physical. In relation to product feature the banks emphasis is on building up an effective brand image. In includes the whole theme more than just the brand name. Uses of distinctive color schemes, tangible objects, slogans etc are being used.

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Due to intangibility of products and in the absence of physical features the bank has to emphasize on differentiation of their offering.

Consumer banking service: 1. Shakarganj Sugar Mill Ltd. s Personal Finance


One can avail unlimited opportunities through Shakarganj Sugar Mill Ltd. s Personal Finance. With unmatched financing features in terms of loan amount, payback period and most affordable monthly installments, Shakarganj Sugar Mill Ltd. s Personal Finance makes sure that you get the most out of your loan. No matter what your need is, Shakarganj Sugar Mill Ltd. has more ways to serve you then ever before.

Features:
Loan amount from Rs.50,000 to 500,000 Repayment period from 1 to 5 years Fixed monthly repayment Low rates that never change No pre-payment penalties Shortest processing time Funds may be obtained at any ACBL branch

And certainly unmatched service quality When you are working towards your financial goals, how you borrow can be just as important as how you invest. The right borrowing options can improve your savings, your cash flow and your ability to take advantage of personal or business opportunities.

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Eligibility to Apply:
Your age is between 21 and 57* You have a verifiable minimum gross monthly income of Rs. 15,000.

Salaried:
Minimum length of confirmed service with present employer is at least six months with a total length of at least one year service.

2. Askari Car Financing


Askari Commercial Bank Limited offers the most convenient and affordable vehiclefinancing scheme, which provides our valuable customers an opportunity to own a brand new vehicle of their choice. Askaris "No eligibility" clause automatically qualifies a person to own a latest car of their choice. With minimum down payment, lowest insurance rates and widest range of available car makes and models, Askari offers the best value to you.

SHAKARGANJ SUGAR MILL LTD. 'S Cash Management Services "Askari


Cash Management Services" aimed at effectively managing the

accounts receivable portfolio of medium and large corporate entities. While this service will help the corporate entities improve their liquidity, due to our welldiversified branch network. The service primarily aims at providing clearing, collection and cash/transfer facility to corporations, under one resource center, which will handle the

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Process through the branches and provide adequate reporting to the corporate clients, on various aspects of their accounts receivable portfolio, every month. As the product can be tailor made for National and Multinational companies. The transaction process flows, operational methodologies and service pricing varies from customer to customer, with marginal modifications, depending upon volumes and nature of transactions involved.

3. Shakarganj Sugar Mill Ltd. 's Value Plus


Shakarganj Sugar Mill Ltd. leads the way, yet again ...... with the introduction of

Shakarganj Sugar Mill Ltd. 's Value Plus, rupee deposit account, which promises greater financial freedom and security, in an unmatched way. Invest as little as Rs.10,000/- in a value plus savings deposit and you are entitled to earn monthly returns, while still enjoying the flexibility of a normal checking account.

Advantages:
Partial liquidity offer on all time deposits Monthly return 24hours world-wide protection plan ASKCARD (Debit Card) & Our unmatched service quality

4.Partial Liquidity Offer:


Offering you a truly exciting opportunity to make your investments break new grounds for you. All you have to do is to invest a minimum deposit of Rs.25,000/-, in a value plus time deposit for a choice tenure i.e. 3 months,6 months or 1 year. The investment will be held in blocks of Rs. 25,000/each. In case you wish to partially withdraw some amount from your total investment, you have the flexibility of encasing

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The blocks that you want, without touching the remaining investment. The unencashed blocks will continue at the same maturity and return.....and yet you don't lose the share of profit on the encased blocks. Upon maturity you have the freedom of either booking your time deposit for tenure of your choice, or let the bank roll it over automatically for a like period.

24 hours worldwide protection:


A unique partnership between Shakarganj Sugar Mill Ltd. and New Hampshire Insurance Company (American International Group, Pakistan) brings global accidental protection for your entire family. At home or at work, your Shakarganj Sugar Mill Ltd. 's Value Plus account is there to take care of you ...round the clock ...providing insurance cover of up to 4 times* the average balance in your account .This is a choice enrolment plan with an automatic monthly premium deduction facility at a price so low ... you can't even imagine i.e. only Rs. 20/- per month..... .....that's what we call relationship banking!

5. Askari Mahana Bachat Account (1 + 3 Years Term)


Earn Rs. 842/- per month on investment of every Rs. 100,000/- for one year!" Earn Rs. 917/- per month on investment of every Rs. 100,000/for three years! Askari Mahana Bachat Account is a Term Deposit facility available to individual customer with the option of 1 and 3 Years tenure. It has been designed keeping in view savings needs of individual investors who dont want to block their funds for longer terms, with a competitive rate of return paid monthly on the 1st of every month. A financing facility up to 90% will be available for customers if required.

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6. Askari Roshan Mustaqbil Deposit:


Shakarganj Sugar Mill Ltd. has launched the Askari Roshan Mustaqbil Deposit, a saving plan specially designed for individual investors who wish to invest now for a regular return at a later stage while keeping their principal amount intact. With Askari Roshan Mustaqbil Deposit you can double your investment in a time period of ten years. Invest now in the form of monthly deposits for five years and get paid back the same amount for the next five years while receiving your principal amount in full at the end of the tenure.

7. Askari Deposit Multiplier Account: Value of initial investment of Rs. 100,000/- will increase to Rs. 265,000/- at maturity! Aim higher with your investments with Askari Deposit Multiplier account. This account is for individual investors whose purpose is long term savings with high returns. With a tenure of 10 Years and a competitive rate of return on maturity this account is ideal for investors who wish to start saving for their future today.

9. ASKARI CARD:
Shakarganj Sugar Mill Ltd. is committed to provide you innovative and competitive solutions to your banking needs in a more efficient and personalized manner. Your Bank enjoys a strategic competitive advantage over all Domestic players by virtue of its leadership, large network and Technological advancement. In line with our tradition of innovation, Shakarganj Sugar Mill Ltd. takes pride in announcing launch of Shakarganj Sugar Mill Ltd. 's Debit Card.

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Askari Debit Card means freedom, comfort, convenience and security, so that you can have retail transactions with complete peace of mind. Askari Debit Card is your new shopping companion which enhances your quality of life by letting you do shopping, dine at restaurants, pay your utility bills, transfer funds, withdraw and deposit cash through ATM anywhere, anytime.

Travelers Cheques
Shakarganj Sugar Mill Ltd. Limited has always remained at forefront in introducing innovative and unique products in banking sector. Our financial instruments provide greater financial freedom and security in an unmatched way to our valued customers. Shakarganj Sugar Mill Ltd. offers you its "Rupee Travelers Cheques" eliminating all financial risks while traveling. So avoid risk of carrying cash through Shakarganj Sugar Mill Ltd. 's Rupee Traveler Cheque

Business Finance:
In pursuance of the National objectives to revive the economy of the country, ACBL is providing loans to small and medium size business enterprises under Shakarganj Sugar Mill Ltd. 's Business Finance Scheme. Our goal is to offer a loan, which enables business community to receive the financing required by them based on their cash flows. Our valued customers can enjoy the convenience of getting financing on attractive terms with the minimum processing turnaround time.

Mortgage Finance
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Askari "Mortgage Finance" offers the convenience of owning a house of choice, while living in it at its rental value. The installment plan has carefully designed to suit both the budget & accommodation requirements. It has been designed for enhancing financing facility initially for employees of corporate companies for purchase/ construction/ renovation of house.

Askari Deposit Multiplier Account


Value of initial investment of Rs. 100,000/- will increase to Rs. 265,000/- at maturity! Aim higher with your investments with Askari Deposit Multiplier account. This account is for individual investors whose purpose is long term savings with high returns. With a tenure of 10 Years and a competitive rate of return on maturity this account is ideal for investors who wish to start saving for their future today.

Islamic banking services:


Islamic Banking was launched under the brand 'Askari Islamic Banking', by opening 6 dedicated Islamic Banking branches in major cities of the country. Further expansion is planned with improved capabilities for offering products conforming to the Shariah principles.

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Askari Islamic Banking opens the doors for Halal banking solutions. Our objective is to put in place an efficient banking system supportive to economic justice and welfare of society in line with Shariah standards. A comprehensive range of Islamic Banking products and services is being offered, in order to meet customer's demand of Shariah Compliant Banking, in the following areas: Islamic Corporate Banking Islamic Investment Banking Islamic Trade Finance Islamic General Banking Islamic Consumer Banking

Islamic Banking products have been approved by the Bank's Shariah Advisor. As per Shariah requirements, funds and products of Islamic Banking are managed separately from the Conventional Banking side. All funds obtained, invested and shared in Halal modes & investments, under supervision of the Shariah Advisor.

Agriculture Finance Solutions


The role of agriculture in Pakistan economy is of pivotal nature. Due to diverse geographical and climatic conditions the country has tremendous potential for growth and development in agriculture. However, adequate and

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timely financial assistance to the farmers will improve production potential of agriculture sector in the country. The modern concept of agricultural credit envisages establishment of an efficient institutional credit system to serve as a package of credit, supplies and knowledge for the overall strength of the farmers who at present suffer from low productivity and financial insecurity. A successful credit evaluation system, therefore, should have the basic ingredients to provide adequate amount at the right time and in the right form to help farmers in making a productive use of loan funds.

ASKARI KISSAN AGRICULTURE FINANCE PROGRAM


The Askari Kissan Agri Finance Program (AKAFP) has been designed to meet ON FARM / OFF FARM credit requirements of farmers on the most convenient, flexible, easy terms and conditions. The program features: A broad array of credit lines designed to meet farming requirements. Repay and borrow at your convenience on revolving credit basis at lowest mark-up rates renewal able after three years. Convenient repayment terms based on cash flow abilities. Availability of leased Tractors / Transport without Land / Collateral. No Hidden Cost. Availability of interest free package for inputs and tractors etc. No Pre-adjustment penalties. Earn prompt payment Bonuses and reduce financial costs

.Insurance covers of leased assets, animals, crops and life assurance of borrowers.

The services related to agriculture financing are: kissan tractor finance kissan ever green fianc

kissan aabpaashi finance

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kissan livestock development finance kissan farm mechanization finance kissan farm transport finance

PRICE
Pricing Policies
At Askari Commercial Bank Limited the pricing strategies applicable are:

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One price strategy Flexible price strategy For Priority Customers many of the charges are waived in order to facilitate them and provide them with high-class services.

The bank staffs in higher posts are also in a position to waive some charges
in order to oblige their customers. So the pricing strategies are adaptable and stern depending upon the type of the customer.

The Bank offers deposits at competitive prices.


Pricing is one of the four Ps of the marketing mix. The other three aspects are product, promotion, and place. Price is the only revenue generating element amongst the 4ps, the Rest being cost centers. Askari commercial bank use different price strategy for different products and service To achieve the organization financial goals for each product it use different strategy When any new product is lunched by the Askari commercial bank the top management Of the organization must the see the marketing objective before selecting a suitable Price for a product, the marketer is needed to review the company's objectives. The More clearer the company's objectives the more easily to set a price

Following are the possible pricing objectives Survival Maximum current profit, Maximum market share, Maximum market skimming,

Product quality leadership.

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When the management set its marketing objective its position in the market and the Product nature where it is an innovative product and creates monopoly in the market When the top management set its pricing objective then stage of setting the price of the Product come Following are the steps in setting price for a product: Selecting the pricing objectives; Determining the consumers' demand; Estimating costs; Analyzing the competitors' costs, prices and offers;

Selecting a pricing method

Selecting the final price

ACBL see the nature of product and charge price according to product if the product Is innovative it charge higher margin before lunching the new product the top Management must see and analyze the demand of product and estimate its costs Analyzing completion cost price and offer and then chooses a pricing strategy according To company objective Askari commercial bank has different product and services Each is based on its own target market and expectation toward the customer price is only Key which generate the revenue for the organization to achieve its financial objective And the success and failure of product and service is depend on the price strategy the

Detail of some product and service and their marketing strategy is given below:

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Product & Service Strategy


Kissan Tractor Finance Electronic Bill Payment Services Cost-plus pricing Market-oriented pricing

Detail
Price = Cost of Production + Margin of Profit. Setting a price based upon analysis and Research compiled from the targeted market. Also with the cost price Charge different price for civilian customer and army customer Askari commercial bank offer a range of product line for former such like Kissan Ever Green Finance,Kissan Tractor Finance, Kissan Aabpashi Finance Premium pricing is the practice of keeping the price of a product or service artificially high in order to encourage favorable perceptions among buyers Pricing method whereby the selling price of a product is calculated to produce a particular rate of return on investment for a specific volume of production Charge the price accoding to competitor Price strategy Charge the price according to competitor Price strategy

Personnel finance

Price discrimination Product line pricing

Agriculture Finance

Deposit Multiplier Account

Premium pricing

Askari Rupee traveler cheque

Target pricing

Askari car Finance

Competition based pricing Competition based pricing

Islamic Banking

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The detail of product and service and their pricing strategy is given below which is Based on company financial objective:

SAFE DEPOSIT LOCKERS


Fee for safe deposit lockers (to be recovered in advance or at the commencement of the period yearly/half yearly/quarterly as the case may be)


. .

Small Medium Large

Rs. 1,200 p.a. Rs. 1,700 p.a. Rs. 3,000 p.a

Extra Large XL (16x 16) Rs. 3,750 p.a Extra Large XXL(16x31) Rs. 6,000 p.a

Charge price according to usage or service

UTILITY BILLS (PTCL, WAPDA, SNGPL)


A. Service Charges RS 8 Rupees payable by utilities companies Charge a fix fee for every customer

AGRICULTURE BANKING
Processing Fee for following Finances: 1% of the sanctioned facility amount Askari Kissan Evergreen Finance.

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Askari Kissan Tractor Finance. Askari Kissan Farm Mechanization. Askari Kissan Livestock Development Finance Askari Kissan Aabpashi Finance Askari Kissan Transport Finance Askari Kissan Green House & Tunnel Finance Askari Kissan Farm Storage Finance Askari Kissan Model Dairy Finance Askari Kissan Gold Fish Finance. Askari Kissan White Pearl Finance Askari Kissan Murghban Finance Askari Kissan Gulban Finance Askari Kissan Samar Bahisht Finance Asan Mali Sahulat.

Service charges on delayed payment of markup/Installment of TF/rollover of revolving credit facilities.

overdue by 31 days to 60 days overdue by 61 days to 90 days overdue (past) 90 days (whichever is higher)

Rs. 500/- (flat) Rs. 1,000/- (flat) Rs. 1,500/- or Rs. 0.46/1000 on daily product

Transfer of Facility (on request within the bank) Rs. 1,000/- (flat)

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Amendments in terms of approval

Rs. 500/- (flat)

Provide a range of product and service to former and provide different loans for Agriculture

Retail banking:
Personal Finance
a. Processing fee for civilians i) Clean - 1.20% of loan amount min. Rs.2, 750/(Including legal & documentation charges) ii) Secured 1.20% of loan amount max. Up to Rs.5, 500/(Legal & documentation charges at actual) b. Processing fee for Armed Forces personnel i) Clean - 1.20% of loan amount min. Rs.1, 800/(Including legal & documentation charges) ii) Secured - 1.20% of loan amount max. Up to Rs.5, 500/(Legal & documentation charges at actual)

Smart Cash
a. Processing Fee i) Clean - 1.20% of loan amount min. Rs.3, 500/(Including legal & documentation charges) ii) Secured - 1.20% of loan amount max. Up to Rs.5, 500/(Legal & documentation charges at actual)

Mortgage Finance
a. Processing Fee Rs.5, 500/- (Flat) b. Legal/documentation/valuation/income Estimation charges at actual

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c. Enhancement Charges Rs.5, 500/- (Flat) d. Late Payment Charges Rs.600/- per installment f. Premature Termination Charges a) In case of early settlement by the borrower charges will be Applicable in the following manner i) 1stYear: Unto 6% on outstanding balance ii) 2ndYear: Up to 5% on outstanding balance iii) 3rdYear onwards: Up to 4% on outstanding balance. b) Up to 10% of the outstanding balance, in case of balance Transferred to other bank, irrespective of the time period Balloon Payment allowed up to a maximum of 20% of The outstanding balance in a year Additional balloon Payment be up to 5.5% charges on the amount being paid g. Balloon Payment Rs.250/- per cheque

Business Finance
Processing Fee Rs.5, 500/- (Flat) Legal/documentation/valuation/income Estimation charges at actual Renewal Fee Rs.5, 500/- (Flat) Enhancement Charges Rs.5, 500/- (Flat) Cheque Return Charges Rs. 600/- (per cheque) Late Payment Charges 21% of the overdue am Premature Termination Charges Up to 6% of the limit.

Auto Finance
a. Processing Fee Rs.5, 000/- (Rs.2, 200/- non-refundable) b. Legal/documentation/valuation/income Estimation charges at actual

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c. Premature Termination Charges Up to 6.5% of the outstanding loan amount d. Balloon Payment 15% of the outstanding balance in a year subject to 3.25% Charges on the amount being paid (balloon payment amount) e. Cheque Return Charges Rs.600/f. Late Payment Charges Rs.600/The price is based on competitor price and price include margin + cost

Place

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Main offices

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Address : SHAKARGANJ SUGAR MILL LTD. RAWALPINDI City: Rawalpindi Manager: 9063200 / 9273178 PABX #: 9063158 E-Mail: b0001@askaribank.com.pk

LIMITED AWT PLAZA BRANCH North 9063198 / 9273177 9273175 / 9273180 / 9273181

Region : Manager (Ops) : Fax No: Tlx:

AWT PLAZA BRANCH, Rawalpindi

Branch Code :

0001

Address : City: Manager: PABX #: E-Mail:

Saima Trade Tower I.I.Chundrigar Road Br,karachi Karachi Region : South 0333-2335404 Manager (Ops) : 0321-3077975 021-2630731 Fax No: 021-2631176 b0002@askaribank.com.pk Tlx:

M.A. Jinnah Road,Quetta Main, Quetta Branch Code : 0003 Address : M.A.Jinnah Road Main Br, Karachi, Karachi Branch Code :0002 City: Quetta Region : South Manager: 081-2833333 Manager (Ops) : 081-3836051 PABX #: 081-2843751-4 Fax No: 081-2845602 E-Mail: b0003@askaribank.com.pk Tlx:

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PESHAWAR CANTT, Peshawar Branch Code : 0004 Address : FAKHR-E-ALAM ROAD PESHAWAR CANTT City: Peshawar Region : North Manager: 091-5271653 Manager (Ops) : 091-5279683 PABX #: 091-9212433-6 Fax No: 091-5276391 E-Mail: b0004@askaribank.com.pk Tlx:

Main / SAT Branch, Lahore Branch Code : 0006 Address : 7-A, Shahrah-e-Aiwan-e-Tijarat City: Lahore Region : Central Manager: 042-9203081 Manager (Ops) : 042-9203633 PABX #: 042-9203673-7 Fax No: 042-9203351 E-Mail: b0006@askaribank.com.pk Tlx:

Jinnah Avenue Branch, Islamabad Branch Code : 0008 Address : 24-D, Rasheed Plaza, Jinnah Avenue, Blue Area, P.O. Box 1499 City: Islamabad Region : North Manager: (051) 2871144 Manager (Ops) : (051) 2271801 PABX #: (051) 2271794-6 Fax No: (051) 2271797 E-Mail: b0008@askaribank.com.pk Tlx: 54683 ASKRI

PK
University Road Branch, Faisalabad Branch Code : 0009 Address : University Road Faisalabad City: Faisalabad Region : Central Manager: 041-9201001,0333-6509781 Manager (Ops) : 041-9201003,0333PABX #: E-Mail: 9201008-11 b0009@askaribank.com.pk Fax No: Tlx: 6664285 041-9201006

Gujranwala Branch, Gujranwala

Branch Code :

0012

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Address : City: Manager: PABX #: E-Mail:

Opposite General Bus Stand G.T Road Gujranwala Gujranwala Region : Central 055-9200857 Manager (Ops) : 055-9200859 055-9200855-56 Fax No: 055-9200858 b0012@askaribank.com.pk TX:

Abdali Road Multan, Multan Address : 64-A, Abdali Road City: Multan Manager: 061-9201399 PABX #: 061-9201391-4 E-Mail: b0013@askaribank.com.pk

Branch Code : Region : Manager (Ops) : Fax No: TX:

0013

Central 061-9201388 061-9201395

Bahawalpur, Bahawalpur

Branch Code :

0025

Promotion
Promotion is a form of corporate communication that uses various methods to reach a targeted audience with a certain message in order to achieve specific organizational objectives. Nearly all organizations, whether for-profit or not-for-profit, in all types of industries, must engage in some form of promotion. Under the concept of Integrated Marketing Communication ACBL attempt to develop a unified promotional strategy

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involving the coordination of many different types of promotional techniques. and, in most cases, to remain a loyal long-term customer. The purpose and objectives for marketing promotions of ACBL may include the Following: Build Awareness Create Interest Provide information Stimulate Demand. Reinforce the Brand

The

objective of promotion strategy is to getting customers to buy an organizations product

Promotional Strategies use by ACBL

Advertising
The main source is used by ACBL is advertisement it involves non-personal, mostly paid promotions often using mass media outlets to deliver the marketers message. While historically advertising has involved one-way communication with little feedback opportunity for the customer experiencing the advertisement, the advent of computer technology and, in particular, the Internet has increased the options that allow customers to provide quick feedback. Advertising in News Papers and Television is used as a marketing tool by ACBL However it is often used when a new product is introduced.

Bill Board:
Another source used by ACBL to convey message is billboard the main areas of urban era near the school/college airport and high traffic areas the bill board are placed to convey message.

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Broachers:
The Bank publishes various brochures for the general guidance of the customers. These include the Schedule of Bank Charges, VISA Card Information, and Savings & Term Deposit Information etc.

Personal Selling:
Personal selling is also a norm at the Bank. The branch has well learned sales executives i.e., Business alumnae. Personal selling is used both for attracting individual and corporate clients.

Internet
Askari commercial bank use internet as a promotion tool to convey the message to the target audience all the information related to product and service and the organization is available on the internet

Social marketing
ACBL has made generous contribution in the area of sport culture poverty woman & child care health & medical science human development and scientific research ACBL sponsored international squash tournaments were professional from all over the world participated Askari commercial has also sponsored other sports tournament include Golf at both amateur and professional level the bank has also contribute toward awareness program for AIDS water conservation and blindness and has promoted the country 's cause on international forum by cosponsoring the first interactive encyclopedia of Pakistan.

Public Relations
The most popular tool use by the banker and manger to increase their deposit crate awareness and loyalty public relation s also tool of promotion.

Publicity:
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This type of promotion uses third-party sources, and particularly the news media, to offer a favorable mention of the marketers company or product without direct payment to the publisher of the information. For example media cover any Tournament that is sponsored by ACBL.

Chapter: 4
FIANANCIAL STATEMENT ANALYSIS
Trend/ horizontal analysis Vertical Analysis Financial Ratio Analysis
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FIANANCIAL STATEMENT ANALYSIS Financial Analysis


Financial Analysis refers to the assessment of a business to deal with the planning, budgeting, monitoring, forecasting, and improving of all financial details within an organization. Three most common methods used for financial analysis are.

Trend/ horizontal analysis Vertical Analysis Financial Ratio Analysis

Horizontal analysis:
A procedure in fundamental analysis in which an analyst compares ratios or line items in a company's financial statements over a certain period of time. The analyst will use his or her discretion when choosing a particular timeline; however, the decision is often based on the investing time horizon under consideration.

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The process of dividing each expense item of a given year by the same expense item in the base year. It allows assessment of changes in the relative importance of expense item over time and the behavior of expense items as sales change

Balance sheet:
A financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time. These three balance sheet segments give investors an idea as to what the company owns and owes, as well as the amount invested by the shareholders.

The balance sheet must follow the following formula: Assets = Liabilities + Shareholders' Equity

Income Statement
A financial statement that measures a company's financial performance over a specific accounting period. Financial performance is assessed by giving a summary of how the business incurs its revenues and expenses through both operating and non-operating activities. It also shows the net profit or loss incurred over a specific accounting period, typically over a fiscal quarter or year. Also known as the "profit and loss statement" or "statement of revenue and expense".

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BALANCE SHEET Rupees in million 2011


Assets Cash and balances with treasury banks Balance with other banks Lending to other financial institutions investments advances Operating fix assets Deferred tax assets Other assets Total assets Liabilities Bills payable Borrowings Deposits and other accounts Subordinate loans Liabilities against assets subjects to finance lease Deferred tax liabilities Other liabilities Total liabilities Net assets Share capital Reserves Unappropriated profit 26168 6235 1592 133757 150711 9349 _ 15945 343757 2756 17273 291503 6990 _ 83 7374 325980 17776 7070 8136 1302 22565 3785 9172 102,260 152784 9988 _ 14190 314744 3090 25,555 255,937 5993 _ 86 8,081 298,740 16004 6427 7,691 702 19,386 8,364 4,614 67,046 135,034 9,845 _ 10,036 254,327 2,945 19,300 205,970 5,995 _ 334 4,833 239,378 14,949 5,073 7183 886

2010

2009

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Total Surplus on revaluation of assets net of tax Total capital Total liabilities and capital

16509 1267 17776 343756

14,821 1184 16004 314744

13,143 1,806 14,949 254,327

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Horizontal Analysis:

2008 vs 2009

2009 vs 2010 16% -55% 99% 53% 13% 8% 34% 24% 5% 32% 24% 0% -74% 67% 25% 7% 27% 6% -16% 13 % -34% 7% 9%

2010 vs 2011 16 65% -83% 31% -1% -6% 12% 9% -11% -32% 14% 17% -3% -9% 9% 11% 10% 6% 86% 11% 7% 11% 9%

Assets
Cash and balances with treasury banks Balance with other banks Lending to other financial institutions investments advances Operating fix assets Deferred tax assets Other assets Total assets

21% 111% 3% 88% 5% 19% 12% 23% 14% 27% 23% 100% 2471% 2% 24% 15% 25% -6% 187% 9% 93% 15% 23%

Liabilities
Bills payable Borrowings Deposits and other accounts Subordinate loans Liabilities against assets subjects to finance lease Deferred tax liabilities Other liabilities Total liabilities Net assets Share capital Reserves Unappropriate profit Total Surplus on revaluation of assets net of tax Total capital Total liabilities and capital

Interpretation:
From the analysis above we have seen that total assets of sari bank has been decreased from 2007-2009.the main reason for this increase is that bank investment increase in 2009

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with a large amount i-e 88%.another reason for increase in assets of bank is the large amount of balances of other banks. When we make a look on liabilities section of bank we have analyzed that the banks liabilities have been increased in 2009 as compared to 2007 and 2008.which means that a large amount of debts have been taken by a bank in this year. Now move to equity section from the analysis of banks capital we came to know that the total capital of bank has been increased in 2009 than in previous years which is a favorable point for bank. Hence the overall trend of the banks financial position that we have analyzed from horizontal analysis is that. Banks total assets have been increased with a minimum amount from 2007-2009 Banks investment shows a large amount of increase the main reason for this change is its less lending to financial institutions and large amount of balances of other banks The total liabilities of bank also decreased which is not a favorable point but it may be due to change in governmental policies or government regulations, countrys economic position and many other factors.

The capital of bank also shows a good point of banks financial position.

Income statement
2009 2010 2011

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Markup / return interest Gain on sale of investments/ net earned144 13,554 Markup revaluation of (2) Unrealized gain on / return / interest expensed investments classified as held for trading 9,033 Net markup / interest income net Provision against nonperforming 2,324 404 Other income loans and/advances 2,555 Total nonmarkup interest income 431 Impairment loss on AFS
8,672

22,587

27,329 213 17,937 (0) 9,392 2319 376 2800 9128 383

32766 307 22700 10067 1630 340 2903 122 44 8639 87 8726 35 2413 1831 833 8236 (48) 785 1194 1628 289 772

investment Non markup/interest expenses: Provision for impairment in the Administrative expenses Other charges of investments value Total nonmarkup / written off directly Bad debts interest expenses Profit before taxation Taxation current Net markup /interest income prior years after provisions Non markup/interest income deferred Fee, commission and brokerage Profit after taxation income Basic / diluted earnings per share Dividend income Rupees Income from dealing in foreign currencies

77 6,996 34 7,030 1,642 2,915 562 6,118 120 (147) 534 1,308 1,108 2.18 163 538

7813297 42 7855 66 1273 3064 330 6,328 0 330 1271 943 210 731

Horizontal Analysis:
2009 vs campus)
147

2010 vs

2011 vs

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2008
Markup / return / interest earned Markup / return / interest expensed Net markup / interest income Provision against nonperforming loans and advances Impairment loss on AFS investment Provision for impairment in the value of investments Bad debts written off directly Net markup /interest income after provisions Non markup/interest income: Fee, commission and brokerage income Dividend income Income from dealing in foreign currencies Gain on sale of investments net Unrealized gain on revaluation of investments classified as held for trading net Other income Total nonmarkup / interest income Non markup/interest expenses Administrative expenses Other charges Total nonmarkup / interest expenses Profit before taxation Taxation current prior years deferred 23% 27% 17% -39% 100% 15015% -100% -28% 67%

2009
21 32 4 0 -11 286 -20 5 3

2010
20 27 7 -30 -68 -85 -47 -40 30

4% -6% -38% 289% -109% 18% -6% 36% 18% 213% 19% 256% 3138% -340 -237 611 187

-3 29 36 48 -82 -7 10 5 12 24 12 -22 -41 -100 -100 -38 -15

-6 38 6 45

Profit after taxation Basic / diluted earnings per share Rupees

Interpretation:
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Net income of Shakarganj Sugar Mill Ltd. has been increased with a large amount in 2009 as compared to 2007 and 2008.the main reason for this increase is:

Net mark up interest income is increased in2009 because of loans and advances taken by a bank in 2009 decreases with large amount. Another reason for this increase is increases in net mark up interest earned by a bank.

Total non mark up interest income has been decreases in 2009.it were a large amount in 2007 and 2008 which was not a favorable point.

Expenses done by a bank in these three years shows that in 2009 bank has done low expenses due to which its income increased. We have seen a decrease in banks administration expenses. Hence the horizontal analysis of Shakarganj Sugar Mill Ltd. shows that companys financial position was much better n 2009 as compared to 2007 and 2008.

Vertical analysis:
Technique for identifying relationship between items in the same financial statement by expressing all amounts as the percentage of the total amount taken as 100. In a balance sheet, for example, cash and other assets are shown as a percentage of the total assets and, in an income statement, each expense is shown as a percentage of the sales revenue. Financial statements using this technique are called common size financial statements dividing each expense item in the income statement of a given year by net sales to identify expense items that rise more quickly or more slowly than a change in sales. For example, an analyst may study a firms balance sheet to compare the level of current assets with the

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level of current liabilities in order to measure liquidity. Analyst often studies a firms income statement to compare net income with total sales.

Example:.
In balance sheet all accounts of assets section will be divided by total assets while in liabilities and owners equity sectional accounts will be divided by total liabilities and equity. In income statement the horizontal analysis will be done by dividing all accounts by mark up interest/return earned.

Vertical analysis Balance sheet:


2007 vs 2006 2008 vs 2007 2009 vs 2008

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Assets
Cash and balances with treasury banks Balance with other banks Lending to other financial institutions investments advances Operating fix assets Deferred tax assets Other assets Total assets

7% 2% 8% 22% 55% 3% 3% 100%

8% 2% 2% 17% 63% 4% 4% 100% 1% 8% 87% 2% -

8% 3% 2% 26% 53% 4% 4% 100% 1% 8% 86% 3% -

Liabilities
2% Bills payable Borrowings 10% Deposits and other accounts 84% Subordinate loans 2% Liabilities against assets subjects to finance lease Deferred tax liabilities

Other liabilities Total liabilities Net assets Share capital Reserves inappropriate profit Total Surplus on revaluation of assets net of tax Total capital Total liabilities and capital

2% 100% 7% 25% 57% 17% 99% 1% 100%

2% 100% 7% 32% 59% 2% 93% 7% 100%

2% 100% 6% 34% 48% 6% 88% 12% 1005

Interpretation:

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From the analysis of balance sheet, we have concluded that the total assets grew by 7% contributed by 42% increase in cash balances, 3% increase in investments and 13% in advances. The investments in 'held for trading' rose by 69% which was added to the investments growth while nominal increases were observed in investments in 'held to maturity' and 'available for sale'.

Vertical Analysis: Income statement


2007 vs 2006 2008 vs 2007 2009 vs 2008

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Markup / return / interest earned Markup / return / interest expensed Net markup / interest income Provision against nonperforming loans and advances Impairment loss on AFS investment Provision for impairment in the value of investments Bad debts written off directly

100% 57% 43% 26% 26%

100% 58% 42% 21% 1% 22% 20%

100% 60% 40% 10% 2% 13% 27%

Net markup /interest income after provisions Non markup/interest income Fee, commission and brokerage income Dividend income Income from dealing in foreign currencies Gain on sale of investments net Unrealized gain on revaluation of investments classified as held for trading net Other income Total nonmarkup / interest income

17%

7.1% 0.9% 4.3% 15.6% -

6.8% 0.9% 4.7% 0.1%

5.8% 0.7% 2.4% 0.6% -

2.2% 30% 47%

1.9% 15% 35%

1.8% 11% 38%

Non markup/interest expenses: Administrative expenses Other charges Total nonmarkup / interest expenses Profit before taxation Taxation current prior years

32% 0.1% 32% 15% 1% -2% -2%

32% 0.1% 32% 3% 1%

31% 0.2% 31% 7% 2.5% 0.5% -0.7%

deferred University of education Lahore (Multan -3% 0% 2.0% campus) 18% 2% 4.9% Profit after taxation 153 Basic / diluted earnings per share Rupees

Interpretation:
On the total mark up interest earned, the lager part is contributed by mark up interest expense in 2009 i.e. 60%

Profit after taxation is lower in 2009 as compared to other two years, because of more expenses and payment of taxes by a bank in this year.

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Ratio analysis:
The ratio analysis and industry analysis tools below are very useful for individuals to instantly assess a company or industry by making two basic types of comparisons. First, the analyst can compare a present ratio with past (or expected) ratios for the organization to determine if there has been an improvement or deterioration or no change over time. Second, the ratios of one organization may be compared with similar organizations or with industry averages at the same point in time. This is a type of "benchmarking" so that one may determine whether the organization is "average" in performance or doing better or worse than others. For the professional, conducting such in-depth analyses is critical, allowing an analyst to make an informed business or investment decision.

Ratio analysis measures:

Liquidity Profitability Degree of Indebt ness

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Liquidity:
Current Ratio = Current Assets / Current Liabilities

2009 Current assets Current liabilities 109256/ 234211

2008 197227/ 188449

2007 176636/ 166275

0.46

1.04

1.06

90 80 70 60 50 40 30 20 10 0

current assets current liabilities

2007 2008 2009

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Analysis:
Current ratio should not be less than 2. This indicates that the current assets are twice than current liabilities. Care should be taken that current assets are not unduly inflated by over valuation Here in this case the current ratio of Shakarganj Sugar Mill Ltd. is lesser in 2007 as compared to 2008 and 2009 which is not a good sign and shows poor liquidity position of the bank

Working Capital Current assets

= 2009 109256 234211 -124955

Current Assets Current Liabilities. 2008 197227 188449 8778 2007 176636 166275 10361

Current liabilities

90 80 70 60 50 40 30 20 10 0

current asstes current liabilitis

2007

2008

2009

Analysis:

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Working capital is greater in 2007 because of lesser liabilities of bank as compared in 2009 and 2008.in 2009 the working capital of bank is negative which means banks assets are less than liabilities.

Times Interest Earned = Earning Before Tax / Interest Exp


2009 Earning Before Tax / 1642/ Interest Exp 7030 0.233 2008 461/ 5,916 0.077 2007 2300 / 4,802 0.478

90 80 70 60 50 40 30 20 10 0

earning before interset interest expense

2007

2008

2009

Analysis:

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This ratio indicates the payment of interest by the bank. From the above analysis this ratio has been decreasing from 2007-2009. In 2007 company is paying its interest payments on time but in the next two years this ratio starts falling..

Debt Ratio =
total Debt / Total Asset

total Debt / Total Asset 2009


21663 / 254327 0.084

2008
18,186 / 206,191 0.085

2007
20,550 / 182,172 0.112

90 80 70 60 50 40 30 20 10 0

total debt total asset

2007

2008

2009

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Analysis:
Debt ratio means how much debt company has been taken from its total assets. The ratio has been decreased from 2007-2009 which means bank total debt has been decreased due to which the amount of ratio has been decreases which is favorable for bank.

Debt Equity Ratio

= 2009

Total Debt / Total Equity 2008


18,186/ 12,035 1.51

2007
20,550 12,100 1.69 /

Total Debt / Total Equity

21663/ 13143
1.64

90 80 70 60 50 40 30 20 10 0

total debt total equity

2007

2008

2009

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Analysis:
This ratio is also decreasing from 2007-2009 which means the portion of equity financing of banks total debt has been fallen in these three years.

Return on Assets =
Operating Income / Average Total Assets

Operating Income / Average Total Assets 2009


7689432 254327 0.032

2008
/ 2,531,035/ 206,191 0.012

2007
8,370,382 182,172 0.045 /

90 80 70 60 50 40 30 20 10 0

operating income average total assets

2007

2008

2009

Analysis:
This ratio shows that the return is lesser in 2008 as compared to return on assets in the year 2007 (gradual increase). Although interest and discount on loans which is the major source of revenue for bank, but cost on deposits and borrowings which is the major

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expenditure of bank has increased more in 2007 than in 2008. Another reason of decrease in return is the decrease in lending rate and increase in financial cost. But again we have seen a small increase in this ration in 2009.

Net Profit Margin:

Formula: (Profit After Tax / Mark Up interest expense) X 100

100 80 60 Profit After Tax / 40 20 Mark Up

2009
1108/ 13629
2008

2008
386 / 10651

2007
profit 2681/ after tax m arkup interst expense

interest

6458

0 expense 2007

2009

0.081

0.036

0.415

Analysis:
Calculation made on the base of data available shows that profit earning after taxes in 2007 is greater than 2008 and 2009 years. Here in this ratio we see that the ratio has

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decreased not only by the single factor but also due to increase in interest. So, both these factors has resulted an decrease of the return. But overall profitability of bank is decreasing that is not a good performance point.

Earning Per Share:


Formula:

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(Profit After Tax / Total No. Of Equity Share)


2009 2008
Profit After Tax

3000 2500 2000

2007

Profit After Tax 1500


1000

1108 Of
2008

386 507
2007

2681 405

Total 500 No. Shares Ratios

508

Total No. Of Outstanding Equity Shares

0 Outstanding Equity 2009

2.18

0.76

6.61

Analysis:
This ratio is also decreasing from 2007 to 2009. It is not good from shareholder and investors perspective.

Cost of Borrowing:
Formula: (Mark up paid / Deposits) X 100
2009 2008 2007

Mark Up/interest expense Deposits Ratio

13629

10651

8686

205970 0.066

167677 0.635

143037 0.060

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campus)

250000 200000 150000 100000 50000 0 2009 2008 2007 Mark Up/interest expense Deposits

Analysis: Calculation made on the base of data available shows that cost of borrowing is
increasing from 2007-2009, which is a healthy sign for the bank..

Administrative Expenses To Deposit Ratio:


Formula: (Admin. Expenses / Deposits) X 100
2009 2008 2007

Admin. Expenses Deposits Ratio

6996 205970 0.033

5904 167677 0.035

4790 143037 0.033

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250000 200000 150000 100000 50000 0 2009 2008 2007 Adm in. Expenses Deposits

Analysis:
This ratio shows the cost incurred to manage and collect the deposits. The lower the ratio will be better for business. In our analysis there is only a minor change in the amount of ratios during 2007-2009.

Cash to Deposits Ratio:


Formula: (Cash / Deposits) X 100
2009 Cash Deposits Ratio 19386 205970 0.094 2008 16030 167677 0.095 2007 13356 143037 0.093

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250000 200000 150000 100000 50000 0 2009 2008 2007 Cash Deposits

Analysis:
This ratio shows that how much is available to

meet the demand liabilities of the depositors. The bank should

have reasonable cash balance to meet the customer requirements against their deposits in the bank. In this case bank ratio was greater in 2008 as compared to 2007 and 2009 which is not a good sign from the bank point of view.

Chapter: 5
SWOT ANALYSIS
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Strength Weakness Opportunity Threat

SWOT ANALYSIS
An analysis indicating towards the organizations strengths, weaknesses, opportunities and threat is termed as SWOT Analysis. Such an analysis is very important for the management in retaining the strength, overcoming the weaknesses, capitalizing over the emerging market opportunities, and carving ways to successfully tackle with the threats and ultimately converting them in the strengths for the organization. During six weeks of my stay at Askari Commercial Bank, I have come across the following SWOT analysis of the bank.

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STRENGTHS Leading private sector bank:


Askari commercial bank is the leading private sector bank in the banking network in Pakistan with many of them online branches in major cities of the country.

Automatic operations:
The operations performed by the bank are highly automated that result in assurance for the customers that their transactions are completed reliably, efficiently and securely.

Full day banking:


One can avail the benefit of the services provided at the bank till 5:00 P.m. which is highly useful for those customers who find it difficult to leave their officers in the morning...

ATM network:
The bank has the largest ATM Network cross the country. The customers of ACBL withdraw access their funds any time at all the ATM Sites with ASKCASH Logo.

Customized solutions:
The management of the bank believes in customer focused banking rather than the product oriented banking. The products and services designed by the bank are specifically tailored to the individual needs of its customers.

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Customer oriented banking:


The priority banking centers of the bank offer an unmatched where the customer receives highly privileged services in a highly elegant environment. It gives the chance of experiencing new standards in banking. Designed specially for those who appreciate only the finest things in life, Priority Banking offers the very highest levels of personalized banking to match customers unique status.

Electronic banking:
The revolution in the banking in the form of electronic banking operations have opened avenues of excellent, efficient and quick services saving the time and costs of the customers and fortunately ACBL is among those few banks who are already reaping the benefits of electronic transactions.

Electronic funds transfer:


ACBL management is quite prepared to adopt the latest advancements in technology resulting in revolution in the banking operations such as check clearing process, computer based teller equipment, automatic teller machines, and electronic funds transfers among the others.

Phone banking:
Phone banking service is very attractive for those classes of customers who dont have time to personally come to the bank i.e. banking on the phone line thus saving the precious time of the customers

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Ethical concerns and public image:


The organizations showing concern for the people, ethics, and environment enjoy good public reputation and are able to reap the benefits in the long run. ACBL management is quite sensitive to this issue.

WEAKNESSES
In my opinions these are the points that might be detrimental to the efficiency and profitability of the bank.

Not highly automated:


The bank has still some of the traditional ways of operations in this advanced technological environment.

Manual book keeping:


Although the bank has computerized accounting system but, still the bankers use to make their entries in the accounting register.

Low job satisfaction:


Understanding and the effective management of the human resources is the most difficult challenge faced not only by the bank but by all the organizations. Even though the people have been sacrificed in the new organizational developments, it is becoming clear that the true lasting competitive advantage comes through human resources and how they are Managed. ACBL seems to not focusing on this highly critical issue as the job satisfaction level of the employees working at ACBL, was quite low.

Lack of specialization:
This famous and useful concept given by Adam Smith in 1776 seems to be missing in the bank. The employees are constantly rotated from one job to another job of totally different characteristic in the view of giving them the know-how of the working in all the

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departments. But I think this is not a very good tactics used by the management. Otherwise the situation might be like this Jack of all and master of none.

Centralization:
There is a high degree of centralization in the bank. Almost all the decision-making is in the hands of the upper management. But centralization is effective up to a certain level otherwise it becomes inefficient and at times costly too. I personally observed that delay occurred in the operations of the employees only due to the fact that they had not got any instructions from the head office.

Lack of training facilities:


Presently there is no specific training program arranged for the new recruiters. They have to learn based on their observations and also their mistakes. It takes a bit time for the fresh one to learn the banking the result is huge amount of blunders, mistakes etc. resulting in monetary and non-monetary losses for the bank. There is pressure not only on the new learner but also on the person placed upon with this responsibility.

OPPORTUNITIES
Apart from the ones discussed in External Factors Evaluation Matrix, the bank is facing the following threats and opportunities currently:

Promote Islamic Banking:


Askari commercial Bank promote Islamic banking in all the branches only a few branches this service is available these are positive external environmental factors effecting the organization.

A large amount of foreign investment is attracted:

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A large amount of foreign investment is attracted to expand their business world wide It is external opportunity for Askari commercial bank to avail it and take a competitive edge and create a strong identity world wide

Steady increase in Customer Deposits:


It is opportunity for Askari commercial bank to steady increase customer deposit by adopting new marketing and promotion scheme and lunch new scheme for their customer

Open branches in rural Areas:


It is opportunity for Askari commercial bank to expand their business in rural areas and met unmet segment in geographical areas and promote their business.

Technological improvements:
It is the opportunity for Shakarganj Sugar Mill Ltd. limited to make technical improvement in their operation and adopt new technologies of business and make their whole operation automatic it is convince for both customer and organization to save their time

Use of ATM as a Credit Card:


It can be an opportunity for ACBL to introduce ATM also as a credit card which will invite a different segment and which will improve profitability. They can also cut costs in this way.

THREATS High Employees Turnover:

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As discussed above, the job satisfaction level of the employee is very low resulting in high turnover, which is bad for any organization as there are huge monetary and non-monetary costs involved in the fresh recruitments.

High charges:
The schedules of charges indicate that the fees charged by the bank on the various services it provides are extremely high. It may result in decrease in the number of its exiting customers. Further more, this could be very alarming situation for the bank in case some of the competitors grasped the opportunity and lowered its rates. The result would be either the lost of market share or decrease in the charges resulting in lowering the banks income.

Less attractive rate of return:


Commercial banks face considerable competition in attracting deposits from individuals or small investors. In contrast, the Govt. of Pakistan national saving scheme offers attractive rates of return (approx. 16 to 18 percent annually) on 10-15 year fixed accounts, which banks find difficult to match.

Stiff Competition:
SCB is currently facing strict competition from the foreign banks especially the American who banks enjoy a good market position. Collectively U.S. banks hold approximately 9 Percent of all commercial banks' assets. At present, three American banks are operating in Pakistan: American Express Bank; Bank of America and Citibank.

Less Experienced Staff:


Owing to huge turnover of the employees, the no. of experienced and well trained staff is very low. Majority of the staff working in the bank branches is quite young and inexperienced. If the bank failed to bring down its high employees turnover, then it would be lacking the most important resources of any organization i.e. the experienced staff.

Legal regulation:
Legal regulation is serious threat for organization because

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Government change their policies and put different kind of taxes and regulation on the Organization top management always keeps the eye on moving trend of government

High rate of inflation:


Higher rate of inflation is a threat for Askari Commercial bank the prices of the product and services up and up and unemployment Is increasing very rapidly bank should adopt flexible policies to give relief their Customer

High charges:
The schedules of charges indicate that the fees charged by the bank on The various services it provides are extremely high. It may result in decrease in the Number of its exiting customers. Further more, this could be very alarming situation For the bank in case some of the competitors grasped the opportunity and lowered its Rates. The result would be either the lost of market share or decrease in the charges Resulting in lowering the banks income.

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Chapter: 6
TRAINING PROGRAMME
Divisional or Departmental detail Activities of intern Projects assignments completed

DEPARTMENTS
The Askari Commercial bank has following department: Account Opening department Cash Department ATM Department

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Account Department Remittance Department Clearing Department Foreign Trade Department Credit Department Credit Card Department

ACCOUNT OPENING DEPARTMENT


Borrowing funds from different sources has become an essential feature of today's business enterprises. But in the case of a bank borrowing funds from outside parties is all the more vital because the entire banking system is based on it. The borrowed capital of a bank is much greater their own capital. Banks borrowing is mostly in the form of deposits. These deposits are lent out to different parties. Such deposit creation is done through opening an account in the Bank. In ACBL Lahore Mr. Asaad Bhutta is operating the account opening department along with performing some auxiliary functions of Check Book Issuing.

TYPES OF ACCOUNTS
In ACBL, there are the following types of accounts: Current account. Saving Account. Askari Special Deposit Account. Term Deposit. Basic Banking Account Ever Green Account

CURRENT ACCOUNT
In current account there is no interest on it. It is for only transaction purposes. They are paid on demand. When a banker accepts a demand deposit, he incurs the obligation of the

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paying all cheques drawn against him to the extended of the balance in the account. As there is no profit paid on this account it is also called chequing account because cheques can be drawn on it. Current account is mostly opened for business.

DEPOSIT SCHEMES PLS SAVING DEPOSITS

RATE OF RETURN 2.50%

MINIMUM BALANCE UPTO--24,999

PAYMENT OF RETURN 6MONTHLY

PRODUCT BASE MINIMUM MONTHLY BALANCE Rs.10,000

Following is a brief description of the current account

SAVING ACCOUNT
The purpose of this account is to induce the habit of saving individuals in the neighborhood. The profit is on the basis of 8.5% per 6 month. The minimum deposit for opening the account is Rs.100/-. Though individuals open such accounts for saving purpose, persons belonging to Armed forces and different military institutions are free to use this account on current basis.

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Following is a brief description of Saving Account

DEPOSIT SCHEMES PLS SAVING DEPOSITS

RATE OF RETURN 2.50% 3.00% 3.50% 4.00%

MINIMUM BALANCE UPTO--24,999 25000TO 99,999 100,000 TO 999,999 1,000,000 --------

PAYMENT OF RETURN 6MONTHLY

PRODUCT BASE MINIMUM MONTHLY BALANCE Rs.10,000

ASKARI SPECIAL DEPOSIT ACCOUNT


ASDA account is an interest bearing current account interest is paid. The payment of return is monthly, where as the rate of return with aspect to the amount of minimum deposit clear from deposit schedules in following table). It is also chequing account because cheques can be drawn on it. It is necessary for this account that the client must maintain a minimum balance of Rs. 50,000 at the end of the month. Thats why it is similar to current account. It is mostly opened by Business but individuals to open this account. Its code is 165.

TERM DEPOSITS
A term deposit is a deposit that is made for a certain periods of time at the end of the specific period. The customer is allowed to with draw the principle amount.

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ACBLs Term deposits are of types clear in the deposit scheme in the table). One of them is "Askari" Advantage one month. The rate of return on this account is 9.75%. The term deposit account vary one month to 5 years and the min balance requirement is Rs.5000/for all following accounts The amount of profit is given to depositors in three ways: By cash By sending a bank Draft to depositors Home address or Officers or whichever is specified as mailing Address.

The amount is credited in any one of the checking Accounts of the depositor

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RATE OF MINIMUM DEPOSIT SCHEMES PLS TERM DEPOSIT 1 MONTH 2 MONTHS 3 MONTHS 6 MONTHS 1 YEAR 2YEARS 3 YEARS 4% 4.5% 5% 5.5% 6% 7% 8% 5,000 5,000 5,000 5,000 5,000 5,000 5,000

PAYMENT RETURN MATURITY MATURITY MATURITY MATURITY SIX MONTHS SIX MONTHS SIX MONTHS SIX

PRODUCT BASE

RETURN BALANCE OF

DAILY DAILY DAILY DAILY DAILY DAILY DAILY DAILY

5 YEARS

9%

5,000

MONTHS

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Basic Banking Account


This account is only for Salaried Persons.Account is opened just for 1000 rupees. In one month any person can withdraw upto two times through cheque and through ATM at any time .Its code is 021.

Ever Green Account


This Account is for those people who want to borrow Agri Loan. Its code is 025.

ACCOUNT OPENING PROCEDURE


For the accounts (C/A, ASDA, SAVING), there are different types of account holders are required for all these types of account holders. The operation /procedure requirement that is needed for " Individual Account " differ greatly from " Joint account " proprietorship "Partner ship , "Limited Company" And "Club society or Association as explained below.

INDIVIDUAL'S ACCOUNT
When a single man or women opens an account in his/her own name and has the right to operate it is called individual Account.

DOCUMENTATION REQUIREMENT
For literate person copy of National Identity Card is required as a primary requirement. For illiterate person and Veiled Women, along with the copy of National Identity Card requirement he or she must come in person for opening the account.

OPERATION
The person place a "Check Mark " in the type of account and type of operation required

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He/She fills in part-I of the form , a fix his /her either two or four similar signature (or thumb expression in the signature space) and get it introduced and signed by a person who already has an account with the bank and write his account number in the specific rows in a specific space. The person fills in "next of Kin " position where he/she father, mother, husband/wife or any other relative's name, his /her address, phone no and affix his/her signature to certify this requirement. This requirement is needed because in his/her absence bank can have correspondence with the specific person. The person put her /his signature (" or thumb expression) on the signature Specimen Card (SS CARD) similar in the area on the form. One the back of S.S Card mailing address, telephone no, Person to contact and introducer space is filled in. These entire requirements are necessary for future The person deposits the initial amount for opening account on to the cash counter. The person put his signature on form -A (check book requisition) on two places in "authorized signature" and fills in the "Title of Account space by writing his name. If the person put his signature in Urdu or any language other than English, he signed a "Vernacular form" where under take that affixed signature are original and his own signature and two postal size photos are needed. The next day is the opening of account.

JOINT ACCOUNT
When two or more persons, neither partners, nor trustees, open an in their name is called joint Account. Husband and wife or two persons of same sex can open joint account.

DOCUMENTATION
For joint account copy of National Identity Card of all the persons is obtained other things remaining same as in individuals account.

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OPERATION
The person checks the type of amount and type of operation required in the respective box on the form. The persons fill in the Part-I and part-II in the form.

Signature of both persons is obtained on the form in the area specified for signature and S.S. Card.

In the title of account space names of all the persons are mentioned.

Accounts holder specified in the form that they will operate the form singly or jointly.

PROPRIETORSHIP ACCOUNT
When an owner of a firm operating singly, opens an account in his firm name, this account is called a proprietorship account the proper himself liable for all his acts.

DOCUMENTATION REQUIRED
For this kind of account, an application for opening the account on the firm letter -pad (having the firm name) is required along with the N-I-C- Card of proprietor.

OPERATION
All operation remains the same except that the firm name is written in the "Title of the Account area and signature of the proprietor are affixed in the S.S. Card and the area specified for signatures on the form.

PARTNER SHIP ACCOUNT


The account is opened in the firm name and all partner designate one two persons to act on behalf of the partner ship firmer all acts on behalf of firm. The partners in the partnership firm are liable for the acts of the firm jointly and severely. Every partner has in a firm has an implied authority bind his co. partners by drawing and enclosed cheques.

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DOCUMENTATIONS
Copy of C. N.I. C of all partners Application to open the account on the firm letter pad. Partner ship deed in case registered partnership firm. Letter showing the implied Authority of one or more partners to act on behalf of the firm. In case of non -registered partnership firm, understanding on behalf of the firm to remain liable for all acts of the firm. Name, address of all partners is written on the pad.

OPERATION
All other requirement remain same except that the form is dully signed by all partners cards are signed by all those partners who will act on behalf of the firm and along filling part-I , Part-Iv is also filled.

LIMITED COMPANY ACCOUNT


This account is for limited companies. In order to facilitate their transaction with outside parties, bank provides many facilities.

DOCUMENTATION REQUIRED
Memorandum of Association. Articles of the Association Resolution of the Board of Director. Certificate of Incorporation. Certificate of commencement of business C-N-I-C

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OPERATION
The persons authorized in the Resolution of the Board of Directors put their signatures on S.S Cards. Next of kin "requirement "is not need in case of a Limited Company. After completing each and every formality, introducer signature is verified by S.S card and is stamped "Verified" customer signatures are admitted by stamping "Admitting" near signature and again signatures on S.S card are admitted in the same way. The same process of verification and admission of the signatures is repeated on Form-A and next of Kin area. After completing each and every formality, Accountant is open in the computer by writing name, address, A/C Number etc.

LETTER OF THANKS
At the start of the letter 2nd day, ACBL issues letter of thanks to "Account opener" and Account Introducer for the trust the have on ACBL.

OTHER RESPONSIBILITIES CHECK BOOK ISSUING


Check books are issued only for checking account such as current Account, saving Account and ASDA Account. They are not issued for other fixed and term deposits because of their Long term Accounts nature.

ISSUING PROCEDURE
Signatures on cheque book requisition are verified by matching with signatures on SS. Cheque book leaves number, account number, account holders name are mentioned in the cheque- book is made by mentioning the and the total of sum of excise duty and provincial tax. The name of A/c holder and date of cheque book issuance is written on cheque book requisition the account-opening officer puts his initials on requisition leave.

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A/c number is stamped over the leaves of cheque book and finally authorized person affix his signature over the debit voucher and he voucher is attached from the cheque book and is handed over to the customer.

RECEIVING INWARD CHEQUES


Another responsibility and function of account Opening Department is to receive Inward cheques for collection of other Banks as well as of ACBL. Then these cheques are sent to clearing official who clears these checks at SBP from other banks.

ACCOUNT CLOSING
Account is closed on the written request of the customer ACBL debits Rs. 100/- as charges for closing the customer account from that account. The account holder with draws the amount by writing a cheque and just leaves Rs. 100/- in his account. But to surrender the cheque book yet if some leaves are yet to be write to the bank as a necessary requirements for closing the account.

PROCEDURE
The customer for individuals account write an application to the manager of the bank an a simple paper about the closing of his account with the bank (In case of proprietor ship partnership and limited company account the application should be written an firm or company letter head) The individual or in case of other type- proprietor firm and company surrender the cheque book to the bank.

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The cheque book is then torn from one side and is attached with the application. In case of Ltd. Company account resolution of the board of directors is also obtained to attach it with the application. The account opening form of the account holder is taken from the account-opening file, and the application, cheque book, and resolution of board of directors in case of limited company account are attached with the form. Lastly, it is written in Red Ink on the form that account closed and Date of account closing.

ATM- CARDS DEPARTMENT


This department deals in issuing ATM-Card, term deposits Mr. Waseem deals this department. ATM CARD ATM Cards are only issued to Account Holder

ISSUING PROCEDURE
The person, first open the account within the blank.

Then he fills the ATM application form in which name of account holder, Fathers name account number and C.N.I.Card number are mentioned. A copy of C.N.I.C is also attached with the application form.

After completing this process, the application package is sent to head office ACBL head office takes a period of 2-3 weeks for preparing and processing of ATM cards. First, list of card holder is issued and then after 15 days cards are send to ACBLs issuing branch. The card and list are not sent simultaneously in order to avoid any mishandling. ACBL takes Rs. 200/- per year as charges for a card

TERM DEPOSIT
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Any person can open a term deposit. He needs not have an account in the bank.

PROCEDURE
The customer comes to the bank and specifies the number of days for which he wants to Deposit hid money in term deposit. The credit voucher is made for the amount of cash to be deposited. The presence of account is not necessary.

The term deposit form is then filled by the officer. The date of opening, the period, the name of the customer, the signature etc is all written on the form.

The term deposit Receipt is filed according. All the requirements are carried out, the signature of the customer and the authorized officer, the stamp of the bank etc. The term deposit Receipt is then given to the customer. The number of the term deposit form and term deposit is noted receipt is then given to the customer. The number of the term deposit form and term deposit receipt is noted in the term deposit Register. After completion of the form, it is posted in the term deposit file. A 0.2% tax on the provincial amount is taken while issuing the receipt. A credit voucher made and the amount is credited to the tax on TD.

CASH DEPARTMENT
Cash department of Bank Alfalah works under the operation department. This department is given the complete responsibility of cash, as result of transaction in touch local and foreign currencies. It is also responsible for the book keeping of these transactions and the safe custody of cash.

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This department performs the main function. Cash receipts Cash payments

Cash Receipts
In cash department depositors use deposit slip for depositing the amount into their accounts. The officer checks if the deposit slip is properly filled up containing title of account, A/C number, date and amount in words and figures. Detail on both counter file and cash receipt voucher should be the same. Cash receiving officer, after twice counted and matched with the deposit slips will handover cash to the customer. The cash details are written on the back of the deposit slip and are also entered in cash receiving register. Cash received stamp is affixed on the face of the deposit slip along with the signature of the cash receiving officer.

CASH PAYMENTS
First the cheque is presented by the customer or holder to cash payment officer. He confirms that it is drawn on the same branch and the particulars of cheque are properly filled in. one signature of the holder is taken on the back of the cheque. Cheque is handed over to the officer cash department for scrutiny where officer checks the date, amount in words and amount in figures, payees name, crossing if any, account number, cheque serial number, any material alterations / endorsements and signature of the customer. Account is debited and then the officer cancels cheque. It is posted in the system and posting stamp and number is affixed on it. Cheque is handed over to the cash payment officer for payment. One more signature on that back of the cheque is taken from the holder to match with the first one, and then cash is paid to the cash detail is written on the back of the cheque. Cash paid stamp is affixed on the face of the cheque. Entry is passed in the cash payment register and system.

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ACCOUNTS DEPARTMENT
Accounts department is a department which deals and checks all the activity of all the department .It also deals in expression of finance of the bank. Salary payment is also one function of the bank.

CHECKING BANKS DAILY ACTIVITY


Accounts department deals and checks the entire working of the Branch; all the vouchers that have been posted at the computer are scrutinized in accounts department. The End of Day i.e. computer print is also received from the computer. The next day the activity is separated some statements from the End of Day. Then next day activity separated some statements from the End of Day. The vouchers are sorted out head wise. The vouchers are matched with the entries in the statements. Any abnormality if occurs, is immediately dealt with. All the vouchers and instruction are checked individually against the computer printouts. After checking they are signed by Mr. Naeem Shahzad and the internal auditor Mr. Shafiq.

OTHER ACTIVITIES
Preparation of daily bank positions statement Payment of salaries Preparation of the statements Depreciation calculation

REMITTANCES DEPARTMENT
Remittance department provides services to the customer of the bank. The main function of this department is transfer of fund

Instruments of bills and remittance department


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The instruments that are handled in the B & R department are as follows: Demand Draft.

Travelers Cheque

Telegraphic transfer. Mail transfer. Pay order. OBC. IBC.

DEMAND DRAFT
A demand draft is an instrument, which is drawn by one bank upon another bank for a specific sum of money payable on demand. It is made by the bank and given to the purchaser against cash or cheque. If two banks are involved, then one banks sends a DD to another bank. But in customer - Bank case the customer sends his DD to the receiver.

ISSUANCE PROCEDURE
A demand draft application (Annexure--) to given to the customer, he fills in a relevant information and signs it. The Officer in charge then checks the information form. The charges such as commission, excise duty, postage is charged as per effective schedule of charges. Tax is exempted if he is taxpayer & knows his No. In case of cash deposit the cashier counts the amounts & signs the DD application and enters it in the register. The cash received equals the amount of remittance & the cheques there on. Then the officer of the bills & remittance department signs it and operation manager counter signs it.

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The entry is made in the DD issuing register. It is given to the customer. The vouchers and the DD form given for posting at the computer. The DD advises are printed at the computer and mailed to the respective branch. NOTE On the contra, when a DD is received i.e. a customer comes to us with the DD, the procedure is as follows.

The DD credit advice is received through mail. The Nos are checked & signatures are verified.

An entry is made on the DD payable register, and the vouchers are made.

the Branch DD payable computer.

Dr Cr

The DD credit is attached with the vouchers and given for the posting at the When DD is received, the test Nos are checked, and the payment is made.

The vouchers are given for posting. And the entry that was made in register is closed. I.e. DD payable is Nil.

Travelers Cheque
The range of our products and value added services enhances with introduction of Rupee Travellers Cheques (RTCs) launched in March 2002. In spite of our constraint on issuing higher denomination of RTCs against restrictions imposed by the Central Bank

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of Pakistan we have been striving to attain our shares with sizeable portfolio. Total volume handled by the department during the year 2004 is Rs. 798 Million. The safe way to carry cash.....another Valuable Financial Service Going places? Don't leave home without the convenience of Askari Travellers Cheques in your pocket. Available in the denomination of Rs.10, 000/-, it's light, safe and ideal for all travel purposes. Welcome to another valuable financial solution from your trusted bank.

Free Issuance
You don't have to pay any service charges for purchasing Askari Travelers Cheques. You can buy these either against cash or debit to your personal account. Simply visit any of our branches located all over Pakistan and enjoy the privileges of buying Askari Travelers Cheques

Earn 0.10% encashment Commission


This matchless feature lets you experience yet another innovative customer care solution. You will receive 0.10% commission whenever the traveler cheque is encased after 30 days of holding.

Enjoy Added Safety & Security


With our state-of-.the-art in-built security features you can be rest assured that this is the best way to make and accept payments. High security lithography, ultra violet printing, special thread, anti scanner pyramid design and unique micro lines, all done and printed in UK gives you the comfort of dealing in the most safest substitute for cash, easily refundable in case of loss and theft.

TELEGRAPHIC TRANSFER
A telegraphic transfer is a fastest & safest way to transfer money. The message is fixed.

ISSUANCE
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The request for maintenance through T.T is taken on the standard printed form. The customer fills it & signs it.

The Head & remittance department checks it, the charges such as commission, tax, telex as per effective schedule and signs it.

If he fills the tax exemption from then no tax is levied. Then a neat T.T is made on the white slip. There are 3 copies. The original faxed to the Branch, one to the Head Office and one is kept as record. The entry is made in the TT issuing register. The following vouchers are posted.

Commission Charges Fax charges

Cr Cr

W.H. Tax.

Cr

When commission bill is received, it is attached to the T.T office copy in the file.

PAYMENTS
When a T.T arrives, the test numbers are checked and the signatures are verified. The entry is done in the T.T pay able register. The following vouchers are prepared & given for posting.

Head Office T.T Pay able T.T Payable. party A./C.

Dr Cr Dr Cr

If there is no a/c then the T.T receipt needs revenue stamps and then the payment is made. The T.T receipt is strictly non negotiable.

PAYORDER
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It is a cheque drawn by a bank on itself. Pay order is an instrument in which the parties are involved the purchase, the bank and the receiver. It can he purchased by any customer. It is usually made by govt. Bodies. A single bank is included in this case.

ISSUANCE
The standard form is given to the customer; he fills in the detail and signs it. The concerned staff checks the form. Charges as per effective schedule are applied. The cash of the pay order is received. A cost memo is signed, stamped and handed over to the applicant as a receipt. Then the pay order receipt is filled accordingly. Counter foil is also filled. An entry is made in the pay order issued register. Then the authorized office after checking the pay order signs it. The pay order is then handed over to the application after obtaining his signature on the P.O form. A voucher is also made and posted at the computer Cr bills payable account P.O issued.

PAYMENT
On representation of the pay two authorized officers of the branch sign order receipt the receipt. The P.O entry is made in the P.O issued register. Then the amount is credited to the account of the customer or paid in cash. The P.O is posted at the computer.

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PAY SLIP
It is an instrument used by the bank s for its payment. The slips are issued to the employees of the banks their bills & invoices. The bills are transferred payments. In this case only one bank is involved .He is the issuer as well as the payer. Procedure prescribed for P.O for issuance and payment is followed for payment is followed for pay slips with the following expectations. Pay slips are issued by the bank for the settlements of this own payment. No excise duty is applicable on P.S.

ISSUANCE A credit voucher is sent from the accounts dept. to the b debt. According to the b debt. The P.S books is taken out & filled according to the credit voucher. It is entered in the P.S./P.O register. It is signed by, an authorized officer, Operational Manager Mr. Abdul Jabbar Qureshi. The pay slips is handed to the customer. A voucher made and posted payment. The P.S. is received on the counter, clearing or transfer. On receiving the P.S. if it is transferred in the P.S. register. The payment is made and the P.O. is posted at the computer. Dr. Bills payable P.S. issued. If Askari branch is in that city, the OBC forwarding schedule in sent to that Askari Branch. Otherwise it is addressed to the particular Branch to whom the cheque belongs.

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OUTWARD BILLS FOR COLLECTION


The bills, which are sent to their cities banks for the local clearing in that city, are called outward bills for collection.

PROCEDURE
The cheques that are banks in other cities are separated. They are entered in the OBC register, the number is written on the stamps. The OBC forwarding schedules are prepared for the different branches. The respective cheques are attached with the schedule. Two authorized officers sign the schedule. The office copy is filled and the original schedule is mailed. On clearance the respective banks send back the OBCS along with IBCA. Inter branch credit advice. The OBC no are checked for the OBC register and the received any entry is made. Charges i.e. commission charges and postages charges are deducted from the A/C. Vouchers of following entries are made.

Party A/C Commission Charges Postage charges

Dr Cr Cr

At the end of the day the contra vouchers are.

OBC collection OBC lodged OBC collection

Dr Cr Dr

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OBC lodged

Cr

INWARD BILLS FOR COLLECTION


The bills are received from other banks out of city for the local clearing are called inward bill for collection.

PROCEDURE
The OBC of the other branches will be the IBCs of this branch. So an OBC forwarding schedule is received by mail. The cheques are entered in the IBC register. The IBC numbers are allotted to them. The cheques are lodged for clearing. After realization, an IBCA is prepared and mailed to the branch. At the end of the day two contra vouchers are made & posted. IBC collection IBC logged IBC Collection IBC lodged Dr. Cr Dr Cr

OTHER FUNCTIONS
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BALANCING THE REGISTER


At the end of the day, all the registers are balanced with the computer balances. The heads and checked are as follows. DD payable IBC collection. MT payable. OBC lodged. OBC Collection. TT payable. IBC lodged. Bills payable. P.S. issued. Bills payable P.O. issued. If the payables are not cleared for a lot of days, a reminder is sent to the respective branches.

CLEARING DEPARTMENT
The process by which cheque exchanged between the collecting and paying bank and the ensuing financial settlement is called clearing. This facility is provided by the state bank of Pakistan for offsetting of cross obligations between the different banks. Clearing is of two types. 1) 2) Inward clearing Outward clearing

Inward Clearing
When cheque drafts, etc, of our branch presented to us for clearing by the SBP. Cheque to be honoured by bank.

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Outward Clearing
The cheque of other banks, which the account holder deposit in their accounts is, sends For collection. CLEARING PROCESS (INWARD/OUTWARD) Here the local cheques are received that are drawn on BAL. All the cheques are received on one counter along with the paying slips duly filled in properly containing particulars of cheque and account holder. Counter folio of paying slip is handed over to the customer by putting stamp for cheque received for collection for Bank Alfalah on it duly signed by officer. These cheques are scrutinized and cheques for local clearing are separated from OBCs. These are then entered in clearing register and cheques for collecting are entered in OBC register and handed over the bills department of collection. Clearing officer checks and verifies title of all the cheques deposited by the customer to confirm the good title of the cheques. Cheques are scrutinized properly and paying slips are separated from cheques. Special crossing, endorsement and clearing stamps are affixed on the cheques. Cheques of each bank are sorted and arranged branch wise. All the cheques are then entered into the clearing system of bank. Print out of the clearing is taken and details are attached. With the cheques of each bank. Details of these banks are then entered into the clearing schedule containing number of cheques presented and their total amount against the name of each bank. Then total number of cheques presented to all banks and their total amount is written on the foot of that schedule, which is tallied with the clearing register. Next morning, these cheques are delivered to the respective banks in clearing house of SBP between 9:00 to 9:30 AM. In the same manner, other banks present their clearing drawn on Bank Alfalah. Total number of cheques and their amount delivered to other banks are received from them are written on the clearing house schedule and handed over to the officer clearing house SBP. Cheques / DD received in clearing are given to the officer cash department of the branch for their repayment. After I proper scrutiny of cheques, verification of signatures and confirmation of balance in the account, officer cash department pays these cheque by canceling and posting them in the system.

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If any cheque is not passed due to insufficient balance or any other reason, officer cash department returns the same cheque by attaching a cheque return memo containing reason for return. This cheque is entered into the cheque returned register and bank charges are deducted according to the schedule of charges. Second clearing is called at 2:30 PM to check the fate of the cheques presented to other banks in the morning. If any cheque is to return, that is delivered to the same bank in second clearing. In the same manner, if any cheque presented by Bank Alfalah in first clearing is returned, they receive it and once again give schedule of clearing figure to the officer-clearing house SBP containing number of cheques and their amount delivered and received unpaid.

FOREIGN TRADE DEPTARTMENT

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Nature has distributed its wealth un-evenly. Some countries are rich in human resources other have mineral wealth in abundance and yet other have arable land and favorable climate conditions for agricultural production. This un-even distribution of resources basically determines the productive efficiencies of different countries. This is the point where different countries come together to exchange their competencies and efficiencies. The countries, which lack in any of the resource, start importing those resources from the country that is having excess of it. In this way the trade starts between different countries.

Benefits of Foreign Trade:


Following are the main benefits of foreign trade. It enables the country to use its resources most profitably and efficiently. A wide scope is available for a country for its surplus production. International competition compels countries to produce quality products at competitive costs. A country can earn foreign exchange by selling its products in the international market.

Trade Finance Services of ACBL.


With its presence in most export-oriented cities in the country, the volume of trade finance business ACBL is one of the highest in Pakistan. That is why most of the companies prefer banking with us. To support the growth of our business partners' ventures, we offer them a wide range of services: Documentary Collection Import Letter of Credit Export Letter of Credit Guarantees Bill Discounting

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Pre-shipment and Post-shipment Financing. Foreign Exchange Department works like the general bank departments with the difference that it deals in foreign currency. This department deals with the following: Import Export Foreign Currency Accounts Foreign Remittance Submission of Monthly Reports to SBP

IMPORT
The international trade transaction, in which one country buys goods from other country, is called import. The import trade in Pakistan is governed by import and export Act of 1950. Previously, the regulating body of imports was controller of Import and Export. But this function has been shifted to Export Promotion Bureau. Foreign Exchange Departments of all banks are restricted to word under the rules and regulations of government.

Import License and Registration:


The individuals and firms who desire to import goods from the foreign countries are required to obtain import license. Import licenses are a type of artificial restraint on the import trade of a country. To acquire import license, the importer has to submit applications to the licensing authority. The importers can only get their merchandize cleared from the custom authorities if they have the import license duly issued in their names. The import licenses issued by the Import Trade Controller are required to be registered with the State Bank of Pakistan.

Contract of sale:
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After getting the license, the importer then negotiates with the exporter. When they reach to an agreement on all terms of sale, they sign a contract. Thus contract includes all information of terms and condition of sale.

Letter of credit:
Foreign trade payment problems are mainly solved by a letter of credit. A letter of credit is issued by the importers bank. If guarantees payment to the exporter up to specified amount of money provided the terms and conditions laid down the L/C are fulfilled. A letter of credit is a commitment on the part of buyers bank to pay or accept draft drawn upon it, provided drafts do not exceed a specified amount. A letter of credit thus is a

Written undertaking by an importers bank to exporters bank. That it will pay or accept draft drawn upon it up to a stated amount with a specified
time.

The payment will only be made to the exporter if he compliers with the terms of
credit.

Parties to a letter of credit:


There are four parties involved in letter of credit.

Account party: The buyer or the importer on whose account and request the
letter of credit is opened is known as account party or opener.

Issuing bank: The bank which issues or opens a letter of credit at the request of
importer is called issuing bank.

Exporter or seller: The seller or the party in whose favour L/C is drawn is the
exporter. He is also called beneficiary.

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Negotiating bank: The paying bank in the exporters country, on which the
draft is drawn, is called negotiating bank or paying bank.

Opening of letter of credit:


The main steps involved in the opening of the letter of creditor as follows:

Application for letter of credit:


The importer will request his own bank or any other bank, which deals in foreign trade transactions to issue a letter of credit in favour of the exporter. He will prepare an application on the prescribed form available from the bank. The information, which are supplied in the application are based on the contract of sale and include only the important feature of contract, such as value of merchandise, port of shipment, documents to be presented, port of unloading, brief description of goods, import license etc.

Scrutiny of application:
Before issuing a letter of credit, the bank will scrutinize whether the importer is of good financial standing, possesses the import license issued by import control. Authorities, the amount available covers the letter of credit applied for, market demand of goods, collateral offered to cover the credit etc

Cash margin:
The bank asks the importer to deposit cash or securities with the bank. The proper margin of cash or securities to be deposited is decided by the bank depending upon the credit worthiness of the importer.

Issuance of the letter of credit:


The importer bank after being fully satisfied will issue a letter of credit in favor of the exporter. The L/C may be sent directly to the exporter or the advising bank in the exporters country. In such a case, the advising bank will inform the exporter about opening a letter of credit.

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Shipment of goods:
When the exporter receives L/C, he examines it to ensure that it conforms to the terms of contract of sales. He then shifts the goods and presents all required documents along with the bill to negotiating bank.

Role of negotiating bank:


The negotiating bank after receiving all the documents and the bill from the exporter will scrutinize them whether these conform to the terms of letter of credit. If the documents of title accompanying the bill are in order, these will be sent to the importers bank for payment.

Liability of the issuing bank:


On receipt of documents and the bill, the issuing bank will examine them. If the documents on the face appear to be in order, the payment would be released by the bank. In case any defect is found in the documents and the draft is honored by the issuing bank the importer can claim damages on the issuing bank. The issuing bank is only accountable for the completeness of documents, not to see whether goods conform to the contract of sale.

Payment by importer to the bank:


First the importer pays all his obligations the bank then bank releases the documents. In case of sight draft, the importers bank pays the amount on the same day charging the importing customers account. In case of a time draft, the importer discharges his obligations to the accepting bank on or before the maturity date of acceptance. The accepting bank will then release all the shipping documents to the importer.

Payment to the exporter:


The exporter can obtain payment from the negotiating bank by discounting the draft (L/C) immediately after shipping the goods and obtaining shipping documents.

EXPORT SECTION
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The international trade transaction in which one country sells its goods to other country is called Export. The controlling body of export in Pakistan is Export Promotion Bureau, it gives different incentives to the businessmen for enhancing the exports and reducing the Balance of payment deficit. It restricts the export of some goods and reinforces export of other. Export section is another section of Trade Services Department. If any person wants to sell his or her products in the foreign countries, he can do all that with the help of export section of the bank. This department is responsible for the export procedures and Documentation. This department handles export documents complying with rules and regulations prescribed by the State Bank of Pakistan. These rules and regulations are briefly described as under. He must all in to sale contract with the importer. He must be having account with the bank. He must have registered himself with CCI&E. He must have export license from EPB. He must have income tax certificate that would be only for export purpose. He is not allowed to export to those countries for which Govt. has restrictions for foreign trade. Full value of goods exported from Pakistan must be declared to custom authorities.

Documents Required For Exports

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Normally following documents are required by the importer that the exporter must submit to the negotiating bank with the shipment documents.

1. Invoices:
The invoice form is needed along with the export documents which are sent to the importers bank. In the invoice form different information is provided regarding the goods to be shipped. It contains the amount, rate, and weight, description, sending and receiving parties names. 2.

Bank Covering Letter

This covering letter is very important letter with the export documents, which are sent to the importers bank. The exporters bank provides this letter. It contains all the information about parties names and addresses, amount, tenor, date, goods, enclosures and terms & conditions. 3. Shipping

Documents

The shipping document includes the buyers and buyers bank addresses, amount, tenor, shipping source and destination. 4.

Bill of Exchange

The bill of exchange is the negotiable instrument for the payments. This is also very important to attach with. 5.

Packing List

The packing list is also attached with the documents of export, which contains the information about the packing of goods being exported. 6.

Bill of Lading

The shipping company issues bill of lading. It means that the goods have been shipped and that goods are in the custody of the master of the ship. In the bill of lading all Information regarding the goods shipped is give. It also indicates that payment has been paid.

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7.

Insurance

The insurance of the goods sent for exports should also be maintained and attached with the other documents. 8.

Letter of Credit

The letter of credit issued by the importers bank is also sent to the importers bank after the review and acceptance. 9.

Export Form

This is just like the import form. It is issued by the exporters bank, which contains the information about goods, quality, invoices, port, consignee, tenor, consignor and mode of shipment.

Foreign bill purchased (FBP):


Following requirements must be fulfilled before the purchase of Foreign Export Bills. Exporter should be account holder of the bank. Bank issues the Form-E. Form-E should be filled correctly and then bank authenticates the E-Form. Exporter goes to the custom authorities for custom clearance. Shipping Company issues Bill of Lading or Airway Bill. Exporter should bring other documents like certificates of Origin, commercial invoice, packing list etc. Bank scrutinizes the documents. After fulfilling these requirements, bank purchases the export bill and makes payment for the value of goods in Pak Rupee to the Exporter.

Lodgement:
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Lodgement means making the payment to exporter by bank against the purchase of bill. Two types of rates are used in evaluating the amount:

OD Buying rate/At sight rate:


It is the rate of export bill, payment of which is to be received within 12 days from the date of lodgement.

Usance rate:
It is the rate payment of which is to be made at a future date, normally within 30, 60, 90, 120, 150, or 180 days.

Realization:
Realization means receiving the payment from the foreign bank for the export of goods.

Other activities:
In addition to Export and Import, there are also other activities performed in Foreign Exchange Department.

1.

Foreign currency accounts:


A depositor can open account in US Dollar, Pond, Japanese Yen and Euro with nominated branches. For opening of account a Form is provided to the person/party, introduction of the new account holder or by the Officer of the Bank. Procedure of opening foreign currency accounts is same as other accounts. No Zakat is deducted on these accounts, no income tax deductions, no wealth tax deduction will be there, these incentives reinforce and motivate the people to invest in foreign currency accounts rather to keep foreign currency idle.

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Bank also operates in Foreign Currency accounts. In accordance with instructions of SBP, foreign currency accounts are opened in these currencies: US Dollar, Pond, Japanese Yen, and Euro. Funds are transferred abroad by Foreign Telegraphic Transfer Swift MT-100 is used for this transfer. Askari Commercial Bank has its agency arrangements in those countries, where its own branches are not established. Its agency arrangements with City Bank, American Express, ABN Amro, Standard Chartered Bank. Submission of monthly returns: It includes reporting of Form-M and Form-E to SBP. Reporting of Form-E: Every Exporter is required to submit a declaration of custom authorities for goods exported. This declaration is submitted on prescribed Form-E in quadruplicate, which is certified by authorized dealer. Four copies of Form-E are maintained. Form-E is reported to SBP at the end of the month, in which the amount is realized. There is a prescribed Performa used for the reporting of Form-E. It includes the reporting period, currency, Serial No. of Form-E, amount, Code No. of country and commodity.

Reporting of Form-M:
Every foreign bank deducts some charges form the value of goods. It is for miscellaneous purposes like foreign bank charges or foreign agent commission. Form-M is used to declare this outflow of foreign currency. At the end of the month of realization of the amount, Form-M is reported. It includes the list of Serial No. amount and purposes of every Form-M.

REFINANCING SECTION
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Refinancing is the credit facility for the exporters provided by the Govt. at lower rate of interest, just to boost the exports in the country. It was started in early 70s. The interest rates are always changing in this facility. The state bank of Pakistan charges 8% and then bank will charge 10% from the customers. For banks this is free source of income because in this way fund of banks are not used. Refinancing is further divided into two parts. Finance against Packing Credit (FAPC). Finance against Foreign Bills (FAFB). 1. FAPC

Loan

This loan is on the basis of export contract. The shipment amount should be equal to the loan amount. It is approved within 48 hours or otherwise disapproved. If approved, the amount is credited in the account of the party. This is also called pre-shipment loan.

2. FAFB Loan
This loan is under L.C. It involves the bank risk line because of the transactions between the banks. This loan is given against security and this is called post-shipment loan.

CREDIT DEPARTMENT
Credit department is also one of the most important departments of the bank. It is called the mind of the bank. This department controls the affairs of bank related with the finances or loans. The credit department of Emirates Bank International also performs the functions relating to the credit administration and credit accounts. It performs following functions.

Products & Services of Credit Dept


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Our Credit and Marketing Department aims at providing complete financial solutions for its customers. Skilled professionals deliver contemporary corporate banking services in a personal manner. Committed to maintaining stable and long term relationships with our customers, Askari Commercial Bank combines personalized services with technological capabilities to deliver sophisticated banking solutions. Products and Services offered include: Trade finance Short Term Working Capital Finance Local Currency Syndication Finance (Foreign Currency Syndication can also be arranged) Medium Term /Long Term Finance Term Finance Certificates Offshore Loans Advisory Role (Balance Sheet Restructuring).

OBJECTIVES OF LENDING
In the modern economics, more than 90% business concern raises their funds from various financial institutions to meet their multifold transaction. Actually it very difficult for the modern businessman to run his business on a huge scale solely. He has to float his shares to the public or knock the doors of financial institutions, for example the banks. The most easy way to make fund available to seek assistance by such agencies including banks which have got surplus funds and will come to the assistance of producing units, distributing units and exchanging units. In this way of lending, the banks earn the profits in term of interest and mark-up.

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Selection of Borrowers
The selection of a reasonable and trustworthy borrower is complicated and at the same time very sensitive task which requires decision-making power from the bank employees. In the words of the manager of a branch of Askari Commercial Bank. Good selection of borrowers does the half task in the profit of the Bank. So banks do not throw the money away but every application is tested carefully before being sanctioned. It is the policy of Shakarganj Sugar Mill Ltd. to provide a outline to all of its branches and on the basis on those requirements the bank select the borrower. Following are the main points, which are considered before lending. 1.

Character

The bank inquires the character of the borrower in every aspect. Because this is the right way to judge his dealing and business tactics. When the bank get sure that this person has good relationship with us and in the business market, they give him the facility of credit. 2.

Capacity

This factor is related with the ability of the borrower to manage his business successfully. So this is checked that either they have necessary management, accounting and technical skills and the degree of experience in the particular line of business for which the finance is required. This ability of the customer can be judge from the trading results, turnover ratios, and collection of receivables and management of accounts payables. 3.

Capital

The proportions of the borrowers own resources to the account of finance requested are the next point to receive the branch managers attention. This is checked that both the amount of loan required by the person is equal to his resources available in his business and will he be able to cover them out of his resources.

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4.

Cash Flows
The source of repayment should be ascertained at the beginning. For this purpose the

financial worth of the customer is checked that either he is able to repay the loan by the sale of his inventory or from realization of the accounts receivables, then the loan is sanctioned. 5.

Collaterals
Security is to be correctly looked upon as the second source of repayment. As we

have discussed that this is one of the most critical decisions for the credit management to sanction the loan thats why they require any collateral by the customer for the security of the loan. In case the borrower is unable to pay his debts then the amount can be recovered by selling the collaterals.

6.

Purpose

Another important factor, which is taken into the consideration by the bank, is that for what purpose the loan is being sanctioned. If the customer wants to get the loan for business purpose then he is given the preference over when he wants to get loan for personal use. 7.

Period

It is the policy of every lender that first the period of the loan is decided. Normally the short-term loans are preferred to be sanctioned because of the lesser risks available. ACBL Bank has its own policy of lending. It only sanction the loans for short term period not for the long term period, normally these are less than or equal to one year.

CLASSIFICATION OF ADVANCES
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The loans and advances given by the bank are classified into two parts. Unsecured or Clean Advances. Secured Advances.

1.

Unsecured or Clean Advances

An unsecured advance is made against the personal reputation of the borrower with the bank. Normally these advances are given to the regular customers of the bank and have maintained a good dealing with the bank for many years. The policy of Askari Commercial Bank is to avoid such clean advances because of the unsecured nature. If the party is unable to repay the loan then it becomes very difficult for the bank to collect the loan. Thats why the bank uses this policy just to give this type of loan only to the exceptional customers.

2.

Secured Advances

The word security means any thing given to protect the repayment of an advance. This is the policy of every financial institution to provide the secured loans to the customers. So secured loans are those, which are backed by the tangible security. A tangible is that which has a physical existence for example Land and Building. Stocks. Share certificates NIT Units. Security of Cash in his Account.

TYPES OF ADVANCES
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ACBL normally classify the advances into the following three major types. Agricultural Advances. Commercial Advances. Industrial Advances.

1.

Agricultural Advances Farm Credit

Agricultural advances are available for each of the following spouse. 2.

These credits are provided for purchase of inputs development of agricultural land. Following are two main classes of farm credit. 3.

Production Finance Development Finance

This loan is provided to farmers for purchase of inputs like seeds, fertilizers and pesticides. 4.

This loan is provided for the development of agricultural land like purchase of tractors, for tube well and for watercourse improvements etc. The basic purpose of these is to boost up the small agricultural industry to provide the opportunities of earning in agricultural sector.

Non Farm Credit


Following is the different type of small agriculture industry for which this loan is granted. Live Stock. Fish Form Dairy Form. Forestry. Sericulture 2.

Commercial Advances
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These are the advances which are given to the small business men, who want to start the business on a small scale. Such loans or advances are not of large amounts but of small amounts. 3.

Industrial Advances
These advances are sanctioned to the industrial persons. The industrialists who

are running their businesses on a large scale can get the facility of these advances. These advances are in large amounts required for the import and exports of the goods and services. These advances are given on the credibility of the parties.

Credit Administration
When some one wants to obtain the loan and his loan is approved, the work of credit administrator starts. He prepares the documentations relating to the advances of the account holders and makes the further processing. He also prepares all the related reporting and then sends it to the head office. He also maintains the documents, which are required by the state bank of Pakistan. The filing of all the legal cases is also maintained by the credit administration. After that the officers maintain the credit accounts and ledgers of the customers.

CREDIT CARD DEPARTMENT


Miss Ayesha Imtiaz deals this department. He told me that the bank is authorized to issue the credit card of two companies, which are under bank of America. Master Card Visa Card

ISSUING CHARGES
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When the card is given to cardholder, there are certain fee charges to by the bank, which is different for different cards.

. ISSUING PROCEDURE
Credit card is issued to three types of parties. Professional (Govt & private officers) Business man Landlord.

PROFESSIONALS
For professionals bank require Authorized letter from the concerned organization in which he works. This letter shows all particulars about the person, on the basis of these particulars; bank open on account and some feasible amount is required.

BUSINESS MAN
In the case of businessman bank need Balance sheet of businessman. Type of business. Turnover of 5 years. And then when it is sured that the business has the ability to cover the expenses of credit card and to pay it at any time, the bank issues the credit card.

Land Lord
In the case, the person is totally new, and the bank doesnt know anything about him. For this bank need an account having the amount over and above the credit card limit of that

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credit card. Usually, there is more chance of default in this case; so, the bank avoids issuing credit card to that person.

PAYMENT PROCEDURE
The cardholder should have to pay all the amounts what he has consumed. But in order to facilitate the cardholder, 5% is the minimum limit that the bank requires and that should be paid monthly. If you paid only 5% then 2% interests will be charged on remaining amount and it is added into the next month payments. If that 5% is not paid then Rs. 100 are the additional charges charged to the next month payment apart form the 2% interest.

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Problems faced by branch


During my internship at this particular branch of ACBL, there are following problems I have found which are directly affect on efficiency and performance of the bank. There problems are also called as an internal problems. So these are discussing below 1. Lack

of communication among the employees


They do not share the

During the period of my internship I found this problem as a biggest problem that, they are not very effective in communication between themselves. experience with each other and do not care the other employee. If one employee has a problem, then he asked to other, but he does not give clear solution to that problems. They are shows the facial expressions against each other.They are talk against each other in front of me. So finally it is very needy for a public services organization to keep atmosphere friendly among the management and employees.

2. Low Efficiency of employees


Efficiency of employees is also low at this branch. For example Mr. Assad Bhutta manager has 3 years experience at ACBL but he is not professional. Where he assign the result is zero. During my internship no body was satisfied from his performance. Sometimes he has done wrongly postings.

3. Lack of computing skills:


Computing skills are also low, some executive are very efficient in computing skills but some are not totally aware from this system. For example ATM machine at this branch is only handled to Mr. Naeem Shehzad manager. When operation manager is on leave branch faces problems about ATM machine.

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4. Misuse

of resources

Resource are very needy, so there must be avoid to misuse the resources but in this branch it is reverse case, there is very wrong use of the resources, employees does not take care of resources and not used them in right direction. For example every person misuse telephone service even guards they use it for personal matters.

CONCLUSION
I observed the Askari Commercial bank a financially sound bank. Its profits are increasingly year-by-year. Its staff is very good and sincere with the bank. A Sheikh has made significant progress in building and strengthening both the corporate and retail banking sectors in Pakistan. Askari Commercial Bank views specialization and service excellence as the cornerstone of its strategy. The people at bank realize that innovation; creativity, reliability, customized, services and their execution are they key ingredients for their future growth. Revenues from these activities have started yielding dividends and they expect significant growth. They are aware that they have stepped into the 21st century and they must meet its challenges by acquiring the highest level of the technology. They will thus be accelerating their technological advance to enable them to distribute their products and services through most efficient and high tech means. They say that they will continue to invest in the modern tools and substantial allocation to resources will be made to achieve this objective during the current year. Online banking have been started and the introduction of ATM at strategic locations have been firmed up.

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RECOMMENDATIONS
This is the fact that in this universe nothing is perfect. In every field of life there are some pluses and minuses. But the best institutions are those, which learn from the changing environment and competition. So it is necessary for them to keep them update with the changing environment. Although Shakarganj Sugar Mill Ltd. Ltd Church Road Jhang Branch is one of the good branch but there are few points that should be improved for more perfection. Marketing department is very active but the feedback or the follow up of the customers should be improved.

As every thing is computerized in Shakarganj Sugar Mill Ltd. Ltd Jhang, the persons should be properly trained in the computer systems. As we have discussed that this is one of the busy branches in Jhang market, its building is not as per the requirements of the branch. So the building should be further expanded and there should be more space for the sitting arrangements of the customers.

The ATM service should be provided 24 hours. Because customers feel upset when most of the times the machine is out of order. The staff should be decreased in Foreign exchange Dept.., Credit dept. because the building under operation is in adequate for such a large staff. Under no circumstances cheque book should be given to the customer if the account formalities are incomplete

Cheques, which are drawn on Shakarganj Sugar Mill Ltd. Ltd Jhang Branch and returned unpaid in clearing, are not reflected in the statement of account of the

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Customers. This cheque must be reflected in the accounts so that credibility of the customers may be assessed. Audit should be held internally, rather there should be an audit department in the branches to make audit on daily basis. This can become so, helpful as a different banks are having this department of their own

. When giving the loan, the Bank must carefully analyze the past six months transaction history of the borrower. This will help in the judgment of the dealing behavior and financial status of the client. In most cases, this thing is not properly done and this is the major reason for the default of many clients.

The Bank should try to give more loans to the small borrowers as the past history shows that most of the loans given to the corporate borrowers have converted into bad debts

Evening banking should also be started in this branch.

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References:
Web Sites:
Askaricards.com/default.asp Dawn.com Pakistaneconomist.com Sbp.org.pk/index.asp En.wikipedia.org/w/index.php

www.askaribank.com/index.php www.sbp.org.net.pk
scribd.com

http : / /www.askar ibank.com.pk/Reports /Askar i


%20Financia l s%202008.pdf

Books
Financial Statement Analysis (Charles H. Gibson)

HR & Personnel Management


(Werther)

Annual report of Shakarganj Sugar Mill Ltd. ltd.

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Annexure
Account opening form Deposit slips OBC Bundle cover Brochures Vouchers

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