Internship Report 2009
Table of Contents
PREFACE
2
ACKNOWLEDGMENT
3
BANKING SYSTEM TODAY
4
CHAPTER 1 THE ORGANIZATION
5
HISTORY AND BACKGROUND:
GENERAL PROFILE OF THE ALLIED BANK LIMITED:
PRODUCTS:
ORGANOGRAM OF ALLIED BANK:
BRANCH NETWORK:
CREDIT RATING:
VARIOUS BANK DEPARTMENTS:
APPRAISALS AND PROBLEMS AT ABL:
6
10
15
36
39
40
43
56
CHAPTER 2 ANALYSIS
57
SWOT ANALYSIS
FINANCIAL ANALYSIS:
FUTURE OUTLOOK:
58
61
64
CHAPTER 3 INTERNSHIP ACTIVITIES
65
WEEKLY ACTIVITIES:
MANAGEMENT STYLE
WORKING ENVIRONMENT:
66
101
101
CHAPTER 4 SUMMARY & RECOMMENDATIONS
102
OVERALL SUMMARY:
RECOMMENDATION FOR
RECOMMENDATION FOR
103
104
105
THE
THE
ORGANIZATION:
IBIT:
ANNEXURE:
106
Annexure:
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Internship Report 2009
PREFACE
The report is specially meant for the students of
MBIT. It is concerned to a brief study of operations,
functions, tasks and services of Allied Bank of
Pakistan.
Banking play very important role in the commerce
and economic development of a country. Now-adays
banks
are
using
different
modern
technologies, which influence the managerial
activities, that’s why I decided to do my internship
training in the bank.
In preparation of this report I have tried my best to
provide all possible information about the
operations, functions, tasks and the corporate
information of Allied Bank of Pakistan in brief and
comprehensive form.
Then
internship
report
ends
with
some
recommendation after identification of problems
that I observed during the course of my internship
training.
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Acknowledgment
“To Him belongs the dimension of the Heavens and the Earth, it is He who
gives life and death and He has power over all things.”
(Al-Quran)
All acclamations are to Allah, the most Merciful and Compassionate, who has
empowered and enabled me to accomplish this task successfully.
After that I submit my earnest thank to my affectionate parents, who pray for
my success and always been a source of encouragement for me. Secondly, I am
grateful to my prestigious institute that made this learning opportunity a part
of my education, especially I would like to thank my Professors as the
knowledge imparted by them enable me to gain knowledge and learning
exposure of the organization in the best way.
Also I express my appreciation to all staff members of Allied Bank of Pakistan
who are very cooperative guided me a lot and also I express my greatest
gratitude to my kindhearted supervisor Mr. Asif Incharge of reporting fraud,
forgery and dacoity, Miss Syeda Ana Mehdi Credit Analyst and the wing head
Mr. Syed Mujtaba Gillani.
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BANKING SYSTEM TODAY
The banking business as we know it today is
composed of three separate and distinctive
principal functions these are:
• The acquiring of funds to invest and advances
•
The investing of such funds and advances
(loans) in bonds
•
The servicing of such funds, such as providing
of checking, saving facilities and the collection
of draft, notes and cheques
These functions while deferring in detail of operations follow the
same principles established hundreds of year ago by money lenders
and exchangers.
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Chapter 1 the Organization
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HISTORY AND BACKGROUND:
Allied Bank was the first Muslim bank that has been established in Pakistan in December 1942 as
the Australasia Bank in Lahore with a paid-up share capital of Rs. 0.12 million under the
Chairmanship of Khawaja Bashir Bux, the Bank attracted deposits equivalent to Rs. 0.431 million
in its first eighteen months of business.
At the time, the Bank’s total assets amounted to Rs. 0.572 million. Today, Allied Bank's paid up
Capital & Reserves amount to Rs. 10.5 billion, deposits exceed Rs. 143 billion and total assets
equal Rs. 170 billion.
The Bank’s journey has been about dedication, commitment,
professionalism and adapting to environmental changes, leading to its
immense growth and stability.
A view of Khawaja Bashir Bux's Residence that was the first branch of
Australasia Bank came into existence. It is these factors that have made it
a Bank the rest look up to.
THE PRE-INDIPENDENCE HISTORY (1942-1947):
In the early 1940s, the Muslim community was beginning to realize the need for its active
participation in the fields of trade and industry. Since the late 1880s, Hindus had established a
commanding presence in the areas of industry, trade and commerce and were especially
dominating in the Sub-continent area. Banking, in particular, was the exclusive forte of Hindus and
it was popularly and wrongly believed that Muslims were temperamentally unsuited for this
profession.
It was particularly upsetting for Khawaja Bashir Bux to hear that:
“Muslims could not be successful bankers”.
He decided to step-up to that challenge and took the lead in establishing this first Muslim bank by
the name Australasia Bank Limited in Punjab, which was to become Pakistan in December 1942.
The initial equity of the Bank amounted to Rs 0.12 million, which was raised to Rs. 0.5 million by
the end of the first year of operation, and by the end of 30th June 1947 capital increased to Rs.
0.673 million and deposits raised to Rs 7.728 million.
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AUSTRALASIA BANK (1947-1974):
A view of the building in Lahore that once housed the Australasia
Bank branch, Australasia Bank was the only fully operational Muslim
bank in Pakistan on August 14th, 1947.
However, it was severely hit by the riots in East Punjab. The Bank was
identified with the Pakistan Movement. At the time of independence
all the branches in India, (Amritsar, Batala, Jalandhar, Ludhiana, Delhi and Angra (Agra)) were
closed down. New branches were opened in Karachi, Rawalpindi, Peshawar, Sialkot, Sargodha,
Jhang, Gujranwala and Kasur. Later, the network spread to Multan and Quetta as well.
The Bank financed trade in cloth and food grains thus, played an important role in maintaining
consumer supplies during the early months of 1948 affected by riots. Despite the difficult
conditions prevailing and the substantial set back in the Bank’s business in India, Australasia Bank
made a profit of Rs. 50,000 during 1947-48.
By the end of 1970 it had 101 branches. Unfortunately, it lost 51 branches in the separation of East
Pakistan. But the Bank did well despite losing a lot of its assets and by the end of 1973 had 186
branches in West Pakistan.
ALLIED BANK (1974-1991):
In 1974, the Board of Directors of Australasia Bank was dissolved and was renamed Allied Bank
after the amalgamation of four banks. The first year was highly successful; profit exceeded Rs. 10
million, deposits rose by over 50 percent and approached Rs. 1460 million. Investments rose by 72
percent and advances exceeded Rs. 1080 million for the first time in the banking history. 116 new
branches were opened during 1974 and the Bank started participating in the Government’s spot
procurement agriculture program. Those seventeen years saw a rapid growth for the Bank.
Branches increased from 353 in 1974 to 748 in 1991. Deposits rose from Rs. 1.46 billion, and
Advances & Investments from Rs. 1.34 billion to Rs. 22 billion during this period. It also opened
three branches in the U.K.
ALLIED BANK- A New Beginning:
In November/December 1990, the government announced its commitments to the rapid
privatization of the banking sector. Allied Bank’s management under the leadership of Mr. Khalid
Latif decided to react positively to the challenge. In September 1991, Allied Bank Limited entered
in the new era of its history a world’s first bank to be owned and managed by its employees. The
850 executives and 7200 staff members spread over 800 branches throughout the Pakistan
established in high degree of cooperation and family feelings.
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ALLIED BANK (1991-2004):
As a result of privatization in September 1991, Allied Bank entered a new phase, and became the
world’s first bank to be owned and managed by its employees. In 1993 the “First Allied Bank
Modaraba” (FABM) was floated. After privatization, Allied Bank became one of the premier
financial institutions of Pakistan.
Allied Bank’s capital and reserves were Rs. 1.525 billion; its assets amounted to Rs. 87.536 billion
and deposits to Rs. 76.038 billion. Allied Bank enjoyed an enviable position in Pakistan’s financial
sector and was recognized as one of the best amongst the major banks of the country.
In August 2004, as a result of capital reconstruction, the Bank’s ownership was transferred to a
consortium comprising Ibrahim Leasing Limited and Ibrahim Group.
Today, the Bank stands on a solid foundation built over 63 years of hard work and dedication,
giving it a strong equity, an asset and deposit base and the ability to offer customers universal
banking services with more focus on retail banking. The Bank has the largest network of online
branches in Pakistan and offers various technology-based products and services to its diverse
clientele through its network of more than 700 branches.
ALLIED BANK (2005 to date):
In May 2005, Ibrahim Leasing Limited dissolved and the company was vested into Allied Bank
Limited. ALL the shareholders were issued ABL shares instead of the all shares held by them. An
application for the listing of ABL shares in all the Stock Exchange Companies of Pakistan was
made; ABL was formally listed and the Bank’s share trading began on the following dates i.e.
Islamabad Stock Exchange August 8, 2005, Lahore Stock Exchange August 10, 2005 and Karachi
Stock Exchange August 17, 2005.
Today, all Allied Bank Limited shareholders can trade in the Bank’s shares at their will and the
Bank stands on a solid foundation of over 63 years of its existence having a strong equity, assets
and deposits base offering universal banking services with higher focus on retail banking.
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IBRAHUM GROUP ASSUMES CONTROL OF ABL:
Ibrahim Group, through its different companies and sponsors owns more than 75% of Allied Bank.
The Group apart from interest in financial sector is engaged in manufacturing of yarn and polyester
staple fiber, trading and power generation.
The consortium of Ibrahim Leasing Limited And Ibrahim Group, which has injected Rs. 14.2
billion into capital of Allied Bank of Pakistan for acquiring its 325 million additional shares, today
assumed the control of the bank. The Governor, State Bank Of Pakistan, Dr. Ishrat Hussain handed
over the relevant documents to Mr. Mohummad Naeem Mukhtar, Authorized Attorney of the
consortium at a simple ceremony held at SBP, Karachi. Among those who present at the ceremony
were Deputy Governor, Mr. Tawfiq A. Hussain and senior officials of the State Bank of Pakistan,
representatives of the Allied Bank and the consortium. Speaking on the occasion, the State Bank
Governor has termed the successful reconstruction of ABL as beneficial both for the organization
as well as for banking industry. He expressed the hope that the transfer of the management of ABL
to a strategic investor will turnaround the bank and usher in a new era of growth and stability in the
banking sector. He stressed upon the new Board of the Bank to run it professionally, prudently and
with the highest standards of corporate governance. It may be recalled that the auction of 325
million additional shares as a part of reconstruction of Allied Bank of Pakistan was held under the
chairmanship of the deputy Governor, State Bank of Pakistan, Mr. Tawfiq A. Hussain at Islamabad
on 23rd July, 2004. In the auction, the consortium of Ibrahim Leasing Limited And Ibrahim Group
were the successful bidder as they offered the highest bid of Rs. 14.2 billion for acquiring these
additional shares, which constitutes 75.35% of the revised capital of ABL. The Federal
Government approved the scheme for reconstruction of ABL, under section 47 of the Banking
Companies Ordinance 1962 on July 24, 2004.
After the approval of scheme by the Federal Government, the State Bank issued the Letter of
Acceptance (LOA) to the consortium of Ibrahim Leasing Limited And Ibrahim Group on July 26,
2004 in terms of which the full payment of Rs. 14.2 billion was made on August 19, 2004. On
receipt of full payment by the Allied Bank of Pakistan Limited and verification of the sources of
funds by the State Bank of Pakistan, the control of the Bank was handed over to consortium of
Ibrahim Leasing Limited And Ibrahim Group.
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General Profile of the Allied Bank Limited:
Allied Bank Limited operates by the following Vision, Mission & Values:
VISION:
To become a dynamic and efficient bank providing integrated solutions and
the first choice of bank for all customers.
MISSION:
•
To provide value-added services to our customers
•
To provide high-tech innovative solutions to meet customer requirements
•
To create sustainable value through growth, efficiency and diversity for all
stakeholders
•
To provide a challenging work environment, and reward dedicated team members
•
To play a proactive role in contributing towards the society
CORE VALUES:
The core values of Allied Bank are these:
•
•
•
•
Integrity
Excellence in Service
High Performance
Innovation and Growth
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OBJECTIVES:
Allied Bank has following objectives:
•
Prime focus to earn profit by providing values to its customers
•
To provide superior services to its customers
•
To provide assistance in the development of the commerce and trade industry
•
Focus on blending skills and experience towards creating an enabling
environment
•
Core focus is to inculcate a culture of collaboration intended to deliver world
class customer service
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BOARD OF DIRECTORS:
“The people who draw the picture of the organization on the broader canvas of
strategy and planning, the pioneers of prosperity and world of wisdom that paves
the path to long term success”
Mr. Mohammad Naeem Mukhtar
Mr. Mohammad Aftab Manzoor
Mr. Khalid A. Sherwani
Mr. Pervaiz Iqbal Butt
Mr. Mohammad Waseem Mukhtar
Mr. Farrakh Qayyum
Mr. Sheikh Mukhtar Ahmed
Mr. Abdul Aziz Khan
Mr. Tasneem M. Noorani
Mr. Sheikh Jalees Ahmed
Mrs. Nazrat Bashir
Mr. Mubashir A. Akhtar
Chairman
(CEO)
President & (CEO)
Director
Director
Director
Director
Director
Director
Director
Director
Director
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EXECUTIVE COMMITTEE:
Mr. Khalid A. Sherwani
President & (CEO)
Mr. M. Naveed Masud
Senior Executive Vice President
Mr. Akhter Ali Khan
Head Credit
Mr. Tahir Saeed Effendi
Head I.T & Financial Officer
Mr. Mohammad Yaqoob
Head Islamic Banking & Planning Div
Mr. Masud A. Sidique
Head Human Resource
Mr. Anwar Zaki
Head Treasury
Mr. Khalid Mehboob
Head Business Promotion
Mr. Sayed Mujtaba Gillani
Head Special Vigilance Unit
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THE MANAGEMENT:
“The brilliants whose passion is dedicated to discover newer ways to make
the organization goals reality”
Mr. Asim Tufail
(Group Chief, Consumer & Personal Banking)
Mr. Fareed Vardag
(Chief Risk Officer)
Mr. Iqbal Zaidi
(Group Chief, Compliance)
Mr. Mohammad Abbas Sheikh
(Group Chief, Special Assets Management)
Mr. Mohammad Aftab Manzoor
(Chief Executive Officer)
Mr. Muhammad Jawaid Iqbal
(Group Chief, Corporate & Investment Banking)
Mr. Muhammad Yaseen
(Group Chief, Treasury)
Mr. Mujahid Ali
(Group Chief, Information Technology)
Mr. Shafique Ahmed Uqaili
(Group Chief, Human Resources)
Mr. Khawaja Mohammad Almas
(Head, Core Banking Projects)
Mr. Tahir Hassan Qureshi
(Chief Financial Officer)
Mr. Tariq Mehmood
(Group Chief, Operations)
Mr. Waheed ur Rehman
(Company Secretary)
Mr. Zia Ijaz
(Group Chief, Commercial & Retail Banking)
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PRODUCTS:
In line with the Bank’s aim to provide a host of products and services to its customers,
substantial ground work has been done to establish a strong consumer banking business.
Furthermore, to achieve this objective, professionals from across the industry have been
recruited into areas of product development, sales, credit policy, research, consumer
analytics, call centers and service quality departments.
Phone Banking:
Allied Bank is focused on delivering exceptional services to its
customers that would strengthen the relationship and build Loyalty. To make banking
experience quick, efficient, secure and easy, Allied Bank of Pakistan now offer its customers
24/7 Phone Banking Services.
Allied Phone Banking provides its customers immense comfort!
In addition, Allied customers can also avail a host of services through automated Allied
Phone Banking (IVR/Self Service Banking) that lets them use their telephone keypad to
inquire about their financial balance/transactions.
Allied Phone Banking Services:
Dial - 0800-22522 to get absolute Banking freedom
Branch Banking:
1. Inquiry
•
•
•
A/C balance
Statement details
Product information
2. Transactions
•
•
•
•
•
Cheque book request
TPIN issuance & re-issuance
ATM PIN issuance & re-issuance
PO/DD & Bank certificate
Funds transfer
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Credit Cards:
1. Inquiry
•
•
•
•
Card balance
Statement details
Product information
Application status
1. Transactions
•
•
•
•
•
Card activation
Card lost/stolen
Card replacement
Credit Card bill payment
Insurances
Internet Banking:
Banking at your fingertips
Allied Direct Internet Banking offers convenience to its customers to manage and control
their banking and finances - when they want to, where they want to! So, just get clicking.
Allied Direct Internet Banking is;
•
•
•
Simple and Convenient
Secure and Faster
24X7 Account Access
Online Banking:
Allied Online Banking is a unique service being offering from
Allied Bank. Through this service, account in Allied Bank is available to customers from
any of abl branches countrywide.
No matter where customers are in the country and whichever branch their account is
maintained at, customer can have their cheque cashed at any of abl 757 online branches
located in 250 cities.
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Customers can also use the service, from any branch, to deposit cash for instant credit into
their account or any other account in Allied Bank. Similarly, the account-to-account Funds
Transfer facility is also available for instant remittance.
Customers’ cheque drawn from a remote branch for credit into a beneficiary’s account or
encashment of a specified amount can also be presented by a third person at any branch.
What’s more, making a Balance Inquiry and getting an Account Statement are additional
services available to Account holders from remote branches.
Allied Online provides a secure, efficient and convenient facility for making payments to
beneficiary accounts from any of abl branches countrywide. Corporate customers requiring
fund collection or a disbursement facility can use it for cash management services.
Allied ATM Networks:
Allied Bank has a vast network of over 460 ATMs installed in
over 130 cities, which continues to grow at a rapid pace.
1 Link Network:
Additionally, Allied Bank is a member of the ‘1-LINK ATM sharing switch’
comprising of over 2,000 ATMs nationwide, therefore, giving its Allied
Cash+Shop Visa Debit Card holders access to even more ATMs across the
country.
The "1-Link Switch" has the following Bank members:
•
•
•
ABN Amro Bank KASB Bank
Limited
Al Baraka Islamic Bank
Meezan Bank Limited
Allied Bank Limited
National Bank of Pakistan
Askari Commercial Bank Limited
NIB Bank Limited
Atlas Bank Limited
•
PICIC Commercial Bank Limited
•
•
•
•
Bank AL Habib Limited
Soneri Bank Limited
Bank Alfalah Limited
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Standard Chartered Bank Pakistan
Limited
Bankislami Pakistan Limited
Union Bank Limited
Crescent Commercial Bank Limited
United Bank Limited
Dubai Islamic Bank Pakistan Limited
MyBank Limited
Emirates Global Islamic Bank
Limited
Tameer Micro Finance Bank Limited
Faysal Bank Limited
Habib Bank Limited
First Dawood Islamic Bank Limited
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All ATMs
connected
with the"1Link Switch"
will show its
Logo.
Bank:
Muslim Commercial Bank
City:
Select City
Branch:
Select Branch
Address:
M NET Network:
The Allied Cash+Shop Visa Debit Card can also be used at
M Net ATMs, for cash withdrawal.
The "M Net Switch" has the following Bank members:
•
•
•
•
•
•
•
•
•
•
JS Bank (American Express Bank)
Bank of Khyber
Bank of Punjab
Citibank
First Women Bank Limited
Habib Metropolitan Bank
HSBC Bank
Muslim Commercial Bank
Saudi Pak Commercial Bank
Prime Commercial Bank
ORIX POS Network:
City:
KARACHI
Merchandiser:
Address:
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Corporate Leasing:
Allied Bank started lease operations when it integrated with
Ibrahim Leasing Limited. Facilities include leases for machinery,
commercial vehicles and equipments. The Bank provides lease
facilities to corporate and commercial clients in all industrial
enterprises for balancing, modernization, replacement and
expansion schemes.
Leasing is a popular mode of financing because of its distinctive features like tax
shield, preserve working capital, easy documentation and less processing time.
Lease applications are processed at all Bank branches in Pakistan.
Unclaimed Deposits:
If the account is dormant or not operated for 5 years then these are called unclaimed
deposits and all unclaimed deposits are surrendered to the State Bank of Pakistan. In
accordance with the Banking Companies Ordinance, 1962, Section 31, the Bank is
liable to surrender to S.B.P, all unclaimed deposits and instruments which have not
been operated/collected by the account holders/beneficiaries for last 10 years.
All such customers/beneficiaries are requested to contact the concerned branch to reactivate their accounts/collect the instruments, failing which, the bank will be
compelled to classify the same "UNCLAIMED" and surrender to SBP.
Deposit Accounts:
Allied Bank of Pakistan provides different nature of
deposit accounts to its customers.
•
•
•
•
•
•
•
•
•
•
•
•
PLS Account
Current Account
Allied Basic Banking Account
Foreign Currency Deposit
Monthly Profit Plus
Rewarding Term Deposit
Behtar Munafa Account
Behtar Munafa Term Deposit
Allied Munafa Account
Allied Bachat Scheme
Allied e-Savers Accounts
Allied Business Account
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PLS Account:
Allied Bank offers the PLS Savings Account facility to its customers with the
following attractive features:
•
Attractive return of up to 5.00% per annum
•
Free Online Transactions, DD/TT/PO for depositors maintaining an average
monthly balance of Rs. 2.500 (M) & above.
•
Free issuance of cheaque book at the time of account opening
Current Account:
•
Allied Bank offers the Current Account facility for individuals as well as for
institutions and commercial customers.
•
There are free Online Transactions, DD/TT/PO for depositors maintaining an
average monthly balance of Rs. 0.5 (M) & above.
•
•
Free issuance of cheaque book at the time of account opening
Allied Basic Banking Account:
In order to provide basic banking facilities to its lower-middle class customers, Allied
Bank has introduced the “Allied Basic Banking Account” (ABBA).
•
•
•
•
•
•
Account can be opened with an initial deposit of Rs 1,000/=
It is a non-remunerative account with a no minimum balance requirement.
The Statement of Account is issued on a yearly basis.
The account will be closed automatically if the balance remains “zero” for one
year.
No service charges on the account for a maximum of 2-withdrawals and 2deposits during a calendar month. Additional transactions will be subject to a
service charge as per the Bank’s Schedule of Charges for every
withdrawal/deposit.
Unlimited withdrawals from ATMs.
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Foreign Currency Deposits:
Allied Bank offers the facility of opening Current, Savings and Term deposit
Accounts. Foreign Currency accounts can be opened in US Dollar, Pound Sterling,
Euro, and Japanese Yen at designated branches.
Monthly Profit Plus:
Saving has now become all the more appealing with our Monthly Profit plus Scheme,
which earns you monthly profits on investments. The scheme is designed for a period
of 1 Year
Tenure
1 Year
with
the
Profit Rate
10.00% p.a.
following
Profit Payment
Rs.833 * per month
profit rates:
Approximate monthly returns calculated on the investment of Rs.100, 000
* Withholding tax, Zakat or other Government Levies are applicable separately
Salient Features:
•
•
•
•
•
Account Type: Term Deposit
Term Period: 1 year
Profit: Payable on monthly basis
Minimum Deposit Amount: Rs.25,000
Eligibility: Individuals & Institutions (other than financial institutions)
Additional Benefits:
•
•
•
•
•
Cheaquing Account for monthly profit credit
24 hour phone banking service
Free internet banking facility
SMS transaction alerts
Allied Cash + Shop Visa Debit Card
Rewarding Term Deposit:
•
•
A term deposit scheme which gives a high rate of return and the flexibility of
various tenure.
Investment can be made with the minimum of PKR 25,000 only.
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Rate of Profit:
D
1
3
ep
M
M
Rs.
7.0
9.0
os
on
on
25,
0%
0%
it Salient Features: th
th
00
A
s
0
m • Account Type: Term Deposit
&
ou • Term Period: 1-12 months
Ab
nt • Investment: Rs. 25,000 & above
ov
e • Profit: Payable on maturity
• Eligibility: Individuals & Institutions
6
M
9.5
on
0%
th
s
12
M
10.
on
50
th
%
s
Allied Advance Profit scheme:
In keeping with our objective to bring you new and innovative services and banking
products, we now introduce Allied Advance Profit Scheme that gives the entire profit
upfront.
Product Specifications:
Minimum Investment Required – Rs.25, 000
Investment Terms:
•
•
18 months
Auto roll-over (optional)
Profit Payment:
Profit of Rs.13, 500* will be immediately credited in the customer’s current account.
*on an investment of Rs.100, 000
Tax/Zakat will be applicable as per rules
Additional Features & Benefits
•
•
•
•
•
Current account for regular banking needs
Allied Cash+Shop Visa Debit Card
Financing facility of upto 80% on investment
Free internet banking facility
24-hour phone banking service
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Behtar Munafa Account:
If customer wants a chequing account that earns it attractive returns, paid on monthly
Upto Rs.5,000,000
Rs.5,000,001 to Rs.25,000,000
Rs.25,000,001 to Rs.50,000,000
Rs.50,000,001 to Rs.100,000,000
Rs.100,000,001 to Rs.250,000,000
Rs.250,000,001 to Rs.500,000,000
Rs.500,000,001 & above
5.00%
6.00%
7.00%
8.50%
9.25%
10.00%
10.50%
basis, then this is the account for such customer.
Rate of Profit:
Salient Features:
•
Account Type: Chequing Account
•
Investment: Up to Rs.5,000,000 & above
•
Profit: Payable on monthly basis
•
Highest Profit: Up to 10.50% p.a
•
Eligibility: Individuals, and institutions
Behtar Munafe Term Deposit:
If customer wants to fix its money now to secure the future, this is the product for
customer.
BEHTAR MUNAFA TERM
DEPOSITS (3739):
Upto Rs. 5,000,000
Rs.5,000,001 to Rs.25,000,000
Rs.25,000,001 to
Rs.50,000,000
Rs. 50,000,001to Rs.
100,000,000
Rs.100,000,001& Above
1
Month
6.00%
6.50%
7.00%
3
Months
8.00%
8.50%
9.00%
6 Months
1 Year
8.50%
9.00%
9.50%
9.50%
10.00%
10.50%
7.50%
9.50%
10.00%
10.75%
8.00%
10.00%
10.50%
11.00%
Rate of Profit:
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Rate of Profit:
•
•
•
•
•
Account Type: Fixed Term Deposit
Investment: Up to Rs.5,000,000 & above
Profit: Payable on maturity
Highest Profit: Up to 11% p.a.
Eligibility: Individuals, and institutions
Allied Munafa Account (AMA):
Salient Features:
•
The applicable profit rate will be based on the amount maintained in the
account on an average monthly basis and the return will also be credited to the
account on a monthly basis.
•
Individuals, Firms, Companies, Schools, Hospitals, Charitable Organizations,
etc., are welcome to open their account in this scheme.
Allied Bachat Scheme:
Allied Bachat Scheme is a PLS Term Deposit Scheme based deposit scheme
whereby customer can double your investment in just 7.5 years.
•
•
•
•
•
Maturity Period: 7.5 years
Minimum Deposit: Rs. 50,000/- with multiples of Rs.
10,000/Expected rate of Profit: The deposit amount will be
doubled in 7.5
Eligibility: All individuals and institutions
Free Internet Banking facility
Allied e-Savers Accounts:
Saving has never been so flexible!
The Allied e-Savers Account is a unique savings plan where customer can earn
returns as high as 7.5% with the convenience of 4 withdrawals a month!
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Salient Features:
•
•
•
•
Investment: Rs. 10,000 to Rs. 500,000
Profit: payable on Half Yearly basis.
Expected Profit Rate: Up to 7.50% p.a.
Eligibility: Individuals
Allied Business Account:
Allied Bank offers banking experience beyond expectations!
Allied Business Account is a non-profit current account with countless benefits and
services. If customers are a businessman, trader or an individual, Allied Business
Account is an ideal proposition for such customers.
Rs. 500,000/- and
above
Features & Benefits
Online/Manual
Remittances
Outward Cheque
Return
Issuance of
DD/TT/PO/OBC
/Expression Collection
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Free
Free
Free
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SME:
The Commercial and Retail Banking Group (CRBG) caters to the needs of commercial
entities and small and medium enterprises. A dedicated team of Relationship Managers first
identifies the specific needs of each customer segment, then designs and delivers a facility
package, which is in conjunction with those needs, and provides customers the full support
and opportunity to take advantage of the various business prospects available in the market.
Following are the main credit facilities ABL offer:
RF/CF:
These are short term credit facilities (maturity of up to one year) lent to customers to meet
their day-to-day business/working capital requirements and finance their inventories,
receivables, etc.
Generally, in addition to collateral security, these facilities also entail security in the form of
hypothecation of stocks and receivable/pledge of stocks.
Export Refinance Facility:
This is mainly the same as RF/CF, but as per the Terms and Conditions set by SBP, is meant
exclusively for exporters. Under the Export Refinance Part I Scheme, both pre-shipment and
post-shipment financing facility is available.
Foreign Bill Purchase/Bill Discounting Facility:
This loan/facility is provided to exporters against their export bills under LC and a contract to
facilitate their cash flow, while they are waiting receipt of their payments.
LC (Sight /Usance):
This facility allows importers to import goods and machinery.
FIM/FATR:
These facilities allow customers to finance imported goods against Pledge & Trust Receipts,
backed by collaterals.
Demand Finance Facility:
This is a medium/long term credit facility available to establish new projects for BMR and
capacity expansion with a repayment term of more than one year, which can be paid back in
installments. This facility meets clients’ long term needs such as, financing factory
constructions or machinery expenses.
Demand Finance Long Term Loans:
The demand finance long term loan is approved for a period of 3-5 years. The loan is
specifically for fixed asset financing with maximum grace period of upto 12 months from
first draw-down.
Inland LC (Sight/Usance):
This facility allows customers to purchase commodities within the country.
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Letter of Guarantee (LG):
On behalf of the customers, the Bank issues a guarantee in favor of the beneficiary, against
the performance of a particular job/contract, within a particular time.
Import Export:
Allied Bank provides highly efficient trade finance services for import/export businesses
through a large number of authorized branches where trained and motivated staff is available
to handle the business on the customer’s behalf.
Cash/ Liquid Financing:
The product is aimed at providing prompt financial services (fund based and non fund based)
to SME sectors. The cash/liquid collateral financing program is aimed to be the cheapest
source of funds available to the SME sector.
Vendor Financing:
The product is aimed at vendors of large corporate entities whereby the corporate entity has
an agreement with the vendor to provide specific quantities of certain goods in a specific
period of time. ABL whould finance such vendors in order to promote their production
capabilities.
Agriculture Finance:
The Bank, under the Agricultural Financing Scheme, as decided by the State Bank Of
Pakistan, extends short, medium and long term, farm and non-farm credits. The farm credits
are extended for production (inputs) and development purposes. Non-farm credits are allowed
for livestock (goats, sheep, cattle), poultry and factories including social forestry and fisheries
(inland and marine, excluding deep sea fishing). Details are as follows:
Farm Loans:
•
Production Loans:
1. Inputs like seeds, fertilizers, pesticides, weedicides, herbicides, labour charges, water
charges, vegetables, floriculture, etc.
2. Working capital finance to meet various farming expenses.
•
Development Loans
1. Improvement of agricultural land, orchards, etc.
2. Construction of Godowns
3. Tractors, Machinery & other equipments
4. Tube wells
5. Farm Transportation, etc
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•
Non-Farm Loans
1. Livestock
2. Poultry
3. Fisheries
4. Forestry
•
Agriculture Revolving Credit Scheme
1. Loan Tenure: 3 Years (Clean up once a year)
2. One time documentation for 3 years
3. Loan limit will be based on the Indicative per Acre limit prescribed by SBP
•
Development Loans/Finances (Term Loans)
1. Loan Tenure: up to 5 years
2. Repayment: Monthly/Quarterly/Bi-Annual
3. Criteria Selection:
a)
b)
c)
d)
e)
f)
g)
•
Amount of Finance
a)
b)
c)
d)
•
Should be a Pakistani & have a CNIC.
Preferably is an account holder with ABL.
Have a permanent residence and be a self-cultivator.
Not be a defaulter of any other Financial Institution/Clear ECIB.
Be reputable in the business
Have ‘Repayment Capacity’
Be able to produce proper securities
Value of agricultural land/Pass Book
80% of PIU or 50% of last 3 years’ average Sale Price or Market Value
50% of Residential/Commercial property in municipal limit.
90% of DSCs/SSCs/TDR/SNDR
Insurance
Insurance facility is available for all Farm and Non Farm Loans except orchards. Insurance
premium amount of subsistence holding farmers availing loans for following 5 major crops
will be reimbursed by the Government of Pakistan.
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1)
2)
3)
4)
5)
Wheat
Rice / Paddy
Cotton
Sugar Cane
Maize
Utility Bill:
Customers can pay their utility bills (e.g. electricity, gas, telephone) at any of the Bank’s
branches. For further convenience, bills are collected on all working days during normal
banking hours and also at certain times during the evening. Bills can be paid with cash or
cheaque, plus customers can even drop crossed cheaque in drop-boxes available at all
branches.
Furthermore, customers can also pay their bills using any of the Bank’s ATMs or via Internet
Banking for SSGC and SNGP bills.
LOCKERS:
Allied Bank Lockers are available, at an annual fee, in four different sizes - small,
medium, large and extra large. Locker holders are not required to have an account with the
Bank.
S. #
Locker Size
1.
2.
3.
4.
Small
Medium
Large
Extra Large
Annual Locker
Rent (Current)
Rs.1,500/Rs.2,000/Rs.4,000/Rs.5,000/-
Maximum Loss
Coverage / Limit
Rs.500,000/Rs.1,000,000/Rs.1,500,000/Rs.2,000,000/-
Hajj Services:
The Hajj Service is available to all pilgrims. The forms and other related services are
provided by the Bank. Hajj applications are available with all branches during Hajj season,
immediately after the Hajj policy is announced by the Government of Pakistan.
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Allied Visa Credit Card:
In order to cater to growing financial needs of customers ABL is proud to introduce Allied
Visa Credit Card with the Lowest Service Charge ever! So now customers can save money
where it counts and spend lavishly at favorite places with greater flexibility, convenience and
most important-Affordability!
With Allied Visa Credit Card customer can enjoy a variety of state-of-the-art features and
unmatched value by spending at over 49,000 merchants across Pakistan and 27 million
merchant outlets worldwide! And what more, customer can also use your credit card at over
1 million ATMs internationally!
Allied Visa Gold Credit Card:
With Allied Visa Gold Credit Card every Pakistani can now enjoy the benefits of a Gold
Card internationally with unmatched savings greater flexibility, convenience and security.
Features:
•
Buy Now, Pay Later:
With Allied Visa Gold Credit Card, free credit period allows customers to pay for purchases
up to 50 days after the date of purchase.
•
Flexible Repayment:
When paying credit card bill, Allied Visa Gold Credit Card gives the option to either pay the
entire amount according to the statement or a minimum of 5% of total outstanding balance.
•
Cash Advance Facility:
As an Allied Visa Gold Credit Card member, customers are entitled up to 75% of available
credit limit in cash.
•
Allied Easy Installments (AEI):
The Allied Easy Installments (AEI) plan provides customers with the facility to pay
outstanding card balance in equal and affordable monthly installments spread over 3, 6, 12,
18, 24, 30 or 36 months.
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•
Supplementary Cards:
Want to share the benefits of Allied Visa Gold Credit Card with others? Now customer can!
Treat up to two people with supplementary credit cards and pass on the many privileges of
Allied Visa Gold Credit Card to the chosen friends and family members.
•
Balance Transfer Facility:
In case customers have outstanding balances on other cards, consolidate these onto the Allied
Visa Gold Credit Card with the lowest BTF rate and save more on the outstanding payments
than ever before.
•
Credit Protection Plus:
With Credit Protection Plus, Allied Visa Gold Credit Card provides payment cover against:
1.
2.
3.
4.
Death, due to accident or sickness
Permanent and Total Disability, due to sickness or accident
Temporary Total Disability, due to sickness or accident
Terminal Illness
•
Zero Loss Liability:
The Allied Visa Gold Credit Card’s Zero Loss Liability feature protects its customers from
paying for any unauthorized transactions on their Card in the event that it is lost or stolen.
•
Free CIP Lounge Access:
As an Allied Visa Gold Credit Cardholder, its customers are eligible to avail the free lounge
facility at Quaid-e-Azam International Airport, Karachi and enjoy a variety of
complimentary features.
Also feel free to plug in your laptop and mobile phone into the charging facilities provided or
browse the internet or send and receive faxes while you wait.
Visa Platinum Credit Card:
With Allied Visa Platinum Credit Card customer can enjoy exceptional benefits and a host of
local and international benefits like never before!
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Features:
With Allied Visa Platinum Credit Card, customers can enjoy these facilities:
•
•
•
•
Visa Platinum Golf
Visa Platinum Dining
Visa Experiential Travel
Priority Pass Airport Lounge Program
• Platinum Life Platinum
Life is a unique platform that showcases exclusive programs and events specially designed
for Visa Platinum Credit Cardholders. With Allied Visa Platinum Credit Card, customers are
eligible to join this exclusive platform and avail many exciting services like Platinum Club,
Platinum Dining, Platinum Golf, Experiential Travel and much more.
• Visa Platinum Club
As a member of the Visa Platinum Club, you are part of an internationally reputed rewards
program that provides an unmatched quality of services and customized luxuries to all Allied
Visa Platinum Credit Cardholders.
• Visa Platinum Websites
The Visa Platinum websites have been designed to ensure that Visa Platinum Cardholders
around the Asia-Pacific region are up-to-date with the latest product offerings and benefits.
The sites also include additional features like:
•
•
•
•
The latest information on Visa Platinum regional programs, such as the Visa
Platinum Club, Visa Platinum Dining, Visa Platinum Golf, Holidays and Visa
Platinum Experiential Travel Facilities.
The latest information on local country promotions and events.
Online applications such as Concierge Online.
A directory of toll-free numbers for reaching the VPCC from all key global
destinations.
Allied Cash+Shop Visa Debit Card :
Features:
•
Get Cash:
Life is always on the move, now your bank account is too.
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By using Allied Cash+Shop Visa Debit Card to withdraw cash directly from bank account
from over 3,500 ATMs in Pakistan - including Allied Bank's largest network of ATMs - and
over 1 million ATMs worldwide
• Stay Alert
Now, be more secure and keep better track of spending. With Allied Cash+Shop Visa Debit
Card,customers can get SMS alerts when they make transactions on their Card.
•
Shop Anywhere
Use the Visa power of your Allied Cash+Shop Visa Debit Card to shop at over 49,000
retailers in Pakistan and over 27 million retailers internationally.
•
•
•
•
•
Dine Out
Enjoy Traveling
Get Groceries
Have Fun
Fuel Up
Cash Management:
ABL’s cash management team offers a full range of transactional banking services, from
collections to cross-border payments, from customized services to comprehensive industry
expertise. Having the largest real-time online branch network in Pakistan, combined with a
host of value-added services, ABL is uniquely positioned to meet the demanding
requirements of global corporate, public sector enterprises and top-tier domestic companies.
With its collaborative approach to building and implementing solutions, ABL is committed to
giving its customers the best service possible.
Home Remittances:
Allied Bank has rolled out its state-of-the-art ‘e-Remittance’ services to facilitate
international remittances sent to Pakistan by overseas Pakistanis.
ABL has been significantly important in originating home remittances to Pakistan, and is
continuously working to develop innovative ideas for maximizing its reach to all Pakistanis
living abroad. We have identified several strategic partners in the main overseas markets, and
will be providing a fully automated, end-to-end solution for non-resident Pakistanis.
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ABL’s real-time online branch network – one of the largest networks in Pakistan, consists of
over 760 branches in 350 cities, and provides domestic distribution of remittances to
customers receiving money in Pakistan.
A host of top international banks, exchange houses and funds transfer companies from across
the world, including the Middle East, Europe, Asia-Pacific and North America, have been
involved to make this a quality service. By implementing a fully automated, straight-through
processing facility, we are in a position to activate an innovative set of remittance products.
A host of options is available to non-resident Pakistanis under this service, including direct
credit to account, cash payment over the counter and issuance of the Allied Express cheque, a
payment instrument that can be honored across the entire ABL network of branches.
CIBG
(Corporate Investment Banking Group)
Corporate Banking
-
Project Finance
Long Term Financing
Short Term Financing
Trade Finance
Investment Banking
- Project Finance
- Syndication
- Advisory
Financial Institution
- Cash Management
- Home Remittances
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Organogram of Allied Bank:
Central Departmentalization
Credit Section
Group
Corporate
Banking Group
Credit
Administration
Group
Foreign Trade
Group
Human Resource
Group
Accounts Group
Finance Group
Information
Technology
Group
Branches
Operations Group
Investment
&
Treasury Group
Internal Division
Group
Audit &
Inspection Group
Administration
Group
Agricultural
Group
Special Asset
Management
Group
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Organogram of SVU
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Organogram of RMG
Hierarchy of Authorities of Allied Bank Limited
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BRANCH NETWORK:
Allied Bank has 885 nationwide branches of
which approximately 67% i.e. 573 are located in
large metropolitan area, namely Karachi,
Islamabad, Faisalabad, Lahore, Multan,
Peshawar and Hyderabad. The network of 855
branches enables the bank to generate a
substantial and stable deposit base, provide a
wide range of banking products and other
financial services and diversify lending risks
geographically, as well as on the basis of credit
and customer type.
Allied Bank divided into four Centers i.e. North,
Central-I, Central- II and South. These Centers
have the regions and the regions further have the
sub branches of Allied Bank Limited. The detail
is given there:
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CREDIT RATING:
Allied Bank’s credit rating has been maintained to ‘AA’ for
long term, by the Pakistan Credit Rating Agency
(PACRA), the leading credit rating agency in the country
and AA donates a very low expectation of credit risk,
indicates very strong capacity for timely payment of financial
commitments and not significantly vulnerable to foreseeable
events.
The short term rating was also maintained at ‘A1+’, which is the uppermost possible rating
under this category and represents highest capacity for timely repayment.
CORPORATE GOVERNANCE RATING:
Corporate Governance Rating (CGR) is meant to indicate the relative level to which an
organization accepts and follows the codes and guidelines of corporate governance practices.
In this context, JCR-VIS Credit Rating Company Limited had assigned a corporate
governance rating of ‘CGR-8’ to your bank during the last year, which denotes ‘high level of
corporate governance’ and is only two notches away from the highest level of CGR.
CGR is arrived at after evaluating key governance elements of the rated enterprise, which
include regulatory compliance, ownership structure, composition and operations of the board
of directors and executive management, self-regulation, financial transparency and
relationship with stakeholders. Rating for the current year is under process.
Term Finance Certificate (TFC) - 1st issue:
In July 2008, JCR-VIS Credit Rating Company upgraded the rating assigned to Allied
Bank’s TFC to ‘AA-’ from ‘A+’ earlier, with stable outlook.
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Deal of the Year Award 2008 by ‘The
Banker’ – UK:
Allied Bank has been awarded the Deal of
Year Award 2008 for Pakistan by The
Banker magazine - United Kingdom. This was awarded in
recognition of Balance Sheet Restructuring & Debt Reprofiling of Maple Leaf Cement Factory Limited for Rs.13
billion which was the largest ever financing extended to
cement company in Pakistan. As the sole financial advisor
lead arranger, Allied Bank was involved in a well-engineered
structure and a timely execution that made the transaction a
The
and
success.
Allied Bank has been declared BANK OF THE YEAR 2006:
Allied Bank has been declared BANK OF THE YEAR 2006 by UK renowned financial
magazine The Banker published by Financial Times Business Limited. This is considered to
be the most prestigious award in the world of finance. The award is given by the The Banker
annually to one high performer Bank in each country based on key performance indicators.
The Bank of the Year 2006 Award was presented to Mr. Khalid A. Sherwani, President of the
Bank during a ceremony held at London, UK on November 30, 2006.
Corporate Finance House of the Year 2007:
It feels pleased to apprise that Allied Bank of Pakistan has been awarded ‘Corporate Finance
House of the Year (Banks)’ for the second consecutive year. CFA Association of Pakistan, a
member society of CFA Institute – USA, conferred the award on Allied Bank based on the
highest value and number of corporate finance concluded during July 2006 –December 2007.
Corporate Report Award & Certificate:
During the year, Annual Report of Allied Bank of Pakistan for the year 2007 won the first
prize for “the Best Corporate Report” for the financial sector category, awarded jointly by the
Institute of the Chartered Accountants of Pakistan and Institute of Cost and Management
Accountants of Pakistan. The Annual Report for the year 2007 was also awarded ‘Certificate
of Merit’ by the South Asian Federation Accountants (SAFA), an apex body of the SAARC
countries.
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Top 1000 Banks of the World – Ranking:
Allied Bank of Pakistan has been ranked among the top 1000 banks of the world by UK’s
‘The Banker’, published by Financial Times London. The categories and ranking are as
follows:
Rank Categories
Rank
Performance based
Profit on average capital (ROE)
Return on assets (ROA)
Real profit growth
31st
130th
206th
Soundness based
Capital assets ratio
517th
Size based
Assets
846th
Overall world ranking
969th
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VARIOUS BANK DEPARTMENTS:
Allied Bank of Pakistan distributed its functions into various groups these are as follows:
Audit & Inspection Group:
Vision:
To transform internal audit function of Allied Bank Limited in to an IT enabled risk based
audit and management consultancy function providing value added services and management
consultancy to the board and senior management.
Mission:
Our mission is to provide an independent, objective assurance and consulting services to
management designed to add value and improve operations of the bank, dedicated to
providing assistance to the management in effectively and efficiently accomplishing its
objectives by bringing a systematic, disciplined approach to evaluate and improve the
effectiveness of risk management, control, and governance processes.
Terms of Reference:
One of the prime responsibilities is the satisfactory implementation of the internal control
over financial reporting. The committee also determines appropriate measures to safeguard
bank’s assets, ensures consistency of accounting policies, reviews financial statements and
recommends appointment of and coordinates with external auditors.
The committee is also responsible to ascertain the internal control system including financial
and operational controls, ensuring adequate and effective accounting and reporting structure,
determining and monitoring compliance with the best practices of the corporate governance.
Implementation of the management testing plan, assessing the testing results and advising
appropriate corrective action is also a major responsibility of Audit Committee.
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Risk Management Group:
Goals:
The goals of RMG are to understand the risk profile of each business area, to propose risk
policies, risk measurement methodologies, and risk limits in order to aggregate and control
credit, market and operational risks across the Bank. In pursuance of these goals, RMG has
taken up the challenge of building an effective Risk Architecture.
Terms of Reference:
The primary functions of Risk Management Committee (RMC) is the monitoring of
management’s adherence to prudent and sound risk policies, assessing the ever changing risk
profile and providing risk appetite to the business units.
It also ensures development of risk management principles to build stakeholders confidence,
safeguard and enhance reputation. The committee approves risk limits for Credit, market and
operational risks, Credit approval grid and proposals regarding rescheduling/write-offs and
filling of recovery suits. Overseeing of certain management committees and groups is also
undertaken by the RMC.
The Committee also monitors the initiatives and expenses pertaining to Basel II and up
gradation of Risk Management Systems.
Structure of RMG:
Risk management functions have been segregated by business specialization i.e. Credit Risk,
Operational Risk, Market Risk, Credit Administration, Risk Architecture and Risk Analytics.
Risk Analytics:
Risk Analytics is an integral part of the credit process. The objective of Risk Analytics is to
limit portfolio concentrations, reduce volatility, achieve optimum earnings and create
shareholder value. It also incorporates portfolio strategy and planning. The Risk Analytics is
a relatively new concept in Pakistan, and the function at ABL has started managing portfolio
risk through launch and usage of risk rating model, design and launch of a new Credit
Application Package, that ensures a risk-based approach to credit presentations and allows
pursuing systematic data gathering with a view to migrating to advanced approaches.
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Credit Administration:
Credit Administration’s role is to minimize losses that could arise due to security and
documentation deficiencies. The Credit Administration unit constantly monitors the security
and documentation risks inherent in the exiting credit portfolio. This function operates
through eight regional departments located all over the country.
All these functions are operating in tandem to improve and maintain the health of the lending
portfolio and keeping aggregate risk within the Bank’s overall risk taking capacity.
Credit Risk:
Credit Risk Management at ABL is divided in to two branches;
1. Corporate & Financial Institutions Risk
2. Commercial & Retail Risk
This function ensures that the risk exposures undertaken match the risk appetite of the Bank,
and that proper credit approval procedure are adhered to. Identification and Monitoring of
problematic exposures and to take proactive measures to minimize the financial loss to the
bank is also a responsibility of this function.
Market Risk:
Market Risk is defined as any fluctuation in value of the portfolio resulting from changes in
market price and market parameters, such as interest rates, exchange rates and share prices.
The Bank intends to build an effective Market Risk Management unit to independently
identify measure, monitor and control the potential losses that may arise from the Bank’s
activities in financial market.
Operational Risk:
It includes risks that primarily arise from internal processes of the Bank. Operational Risk
Management unit is developing an effective system for identification of critical risk areas,
and developing processes/controls to mitigate these risks.
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Commercial & Retail Banking Group:
All the regional heads of Allied Bank reports the Commercial and Retail Banking Groups,
The hierarchy of the Allied Bank is as follows:
ONE GROUP CHIEF OF CRBG
FOUR GROUP HEAD
(Central-I, Central-II, South and North)
TWENTY REGIONAL HEAD
BRANCH MANAGERS
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Operation Group:
Operations Group, apart from re-engineering the existing procedures to ensure safe and
smooth conduct of Banks operational activities also focuses on supporting the field offices in
pursuit of their business objectives and goals while maintaining adequate controls from a risk
perspective.
Group also assisted in launching of a variety of value added services facilitating bank’s
account holders/customers by offering them a wider product range and efficient delivery.
Operations Group is divided into the following five areas.
1. Alternative Delivery Channels provides innovative and value added I.T. based solutions
to the Bank’s clients.
2. Branch Operations supports the field functionaries through procedural manuals, branches
rationalization, fully automated inter branch & nostro accounts reconciliations. It also
provides support Hajj & Zakat matters. During 2005, it has developed a number of new
procedural manuals including ATM, Allied Online, Remittances, and Cash & Teller etc.
3. Treasury Operations supports Treasury front office in settlement of its trading/investment
activities in Foreign Exchange, Money Market and Stock Market besides providing
operational support in cash management to the branches and other business areas of the
Bank.
4. Establishment caters to the Bank’s requirements for printed stationary, operating and
fixed assets, insurance and security arrangements at the central office level.
5. Engineering is responsible for the purchase of new properties and construction/renovation
of the existing/newly hired premises.
Information Technology Group:
The Allied Bank Ltd has a separate Group for Information Technology which looks after the
entire bank’s automation. The bank’s major achievement in automation is that 100%
branches are computerized and inter-connected and these branches offer the customers full
range of online banking services. The bank also offers most of the currently sought after
technology based products including Internet Banking.
The IT Group is presently structured in three areas namely
1.
2.
3.
4.
Core Banking T24
Software Services
Office Automation / Technical Services
Operations
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But with the launch of the Core Banking project driven from Head Office at Lahore, the IT
Group will be re-structured very shortly.
A complete revamping of the IT Group is underway to cater to the expansion of activities
within the IT Group and to create capacity for the Core Banking Project. Moreover, the IT
Group will extend its support to the newly created Regional Offices as well. The new IT
Organization is expected to grow both vertically and horizontally and a substantial number of
new hiring will take place to fill the gaps within the new organization chart.
Human Capital Group:
The group defines the organizational structure and functional responsibilities of each group.
It approves staff strength, key appointments, salary revisions, bonuses and any special
allowances. It nominates the management personnel on the boards of other companies /
subsidiaries. It also recommends amendments in Human Resources Policy to the Board.
Besides monitoring performance of Human Resources Group, the committee also oversees
certain H.R. related management committees.
Corporate & investment Banking Group:
The Corporate Investment Banking Group (CIBG) holds the Bank’s loan portfolio and enjoys
a leading position in corporate lending in the country. It offers a wide range of financial
services to medium and large sized public and private sector entities. These services include,
providing and arranging tenured financing, corporate advisory, underwriting, cash
management, trade products, corporate finance products and customer services on all bank
related matters.
ABL – C&IBG was established in 2005 and focuses on the Investment Banking market.
It has the highest number of Successful Arrangement and Participation in Key Privatization
& Acquisition Financing Transactions achieved by any Investment Banking Group in
Pakistan.
C&IBG – Ranges of Services:
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Finance Group:
Finance Group plays a central role in strategic decision making, transparent financial
reporting and enhancing the economic value of the Bank. It also provides support to the
business groups in performance analysis and launching new products and initiatives.
Finance Group has three major areas:
-
Planning and MIS arm of the Finance Group translates financial and operational data
into strategic information for an efficient and effective decision making.
-
Financial and Regulatory Reporting arm of the Finance Group provides timely,
relevant and reliable information to the shareholders, regulators and other
stakeholders while following the statutory requirements and international best
practices.
-
Taxation wing of the Finance Group manages the Bank wide tax matters and
endeavors to bring tax efficiency while complying with the tax laws.
Corporate Affair Group:
Corporate Affairs Group is responsible for compliance of all legal and statutory corporate
requirements under Corporate and Banking laws and Regulations. Besides arranging Board of
Directors and Shareholders’ meetings, it co-ordinates meetings of the Strategic Planning &
Monitoring Committee of the Board,and Management Committee.
The corporate group has two wings:
CORPORATE AFFAIRS WING:
1. To deal corporate matters with Security and Exchange Commission of Pakistan,
Company Registration Office Lahore, Stock Exchanges and State Bank of Pakistan.
2. To arrange meetings of the Board of Directors and preparation of the Agenda for such
meetings.
3. To assist Company Secretary in all Corporate and Board Affairs.
4. To assist Company Secretary in implementation of the decision of the Board.
5. To obtain approvals through circulation on emergent proposals from the Directors.
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6. To obtain approvals through circulation on the cases from the Board of Directors,
Strategic Planning & Monitoring Committee.
7. To maintain record of Board of Directors, S. P. & M. C. Other Committees along with
former Executive Board.
8. To arrange meetings of the Management Committee and prepare agenda for such
meetings.
9. To affix company seal on Powers of Attorney, Shares and other documents as & when
required and keeping its record.
10. To keep liaison with Govt. nominee and non-employee Directors of the Bank.
11. To assist Group Chief in carrying out different assignments entrusted by the
President.
12. To provide information to Credit Rating Agency and co-ordinate with them in the
process of Entity Rating.
13. To co-ordinate with Share Wing and Finance Group for arranging AGM/Extra
Ordinary General meetings.
14. To provide information’s to external Auditors and SBP Auditors.
SHARES WING:
Shares Wing a part of Corporate Affairs manages shareholders’ matters and co-ordinates with
the Shares Registrar for the transfer and issue of Bank’s shares.
1. To supervise Government Compensation Bonds.
2. To make correspondence relating to ABL Shares with Employees / Legal Wing /
Registrar / shareholders.
3. To make arrangements for floatation of shares & TFCs and payment of dividend on
behalf of public limited companies.
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SAM Group:
The Special Asset Management Group further grouped into three wings namely:
1. Legal Affairs Wing
2. Special Vigilance Wing
3. Corporate & Commercial Wing
LEGAL AFFAIRS:
The personnel engage with Legal Affairs is responsible for monitoring of all legal matters
pertaining to the bank, covering functions of rendering opinions of applicable laws, to deal
with special tasks and assignments , advice on legal issues relating to operational matters,
legal compliances and to ensure remedial and litigation management.
This diligently provide counseling on all legal matters including suits filed, executions of
decrees & criminal complaints etc;. It coordinates with the advocates on Bank’s panel;
ascertain their enlistment and selection of appropriate lawyers in complicated legal cases
which is one of its core responsibilities.
Through its law officers, following objectives are achieved.
FUNCTIONAL RESPONSIBILITIES
1. To render legal advices and guidance sought by the branches in matters of legal
significance and involvement.
2. To provide assistance to the branches/offices in filing of suits, Execution application
and in other Legal matters.
3. Follow-up of all the pending Suits, Decreed cases and Executions.
4. To impart legal opinion on documents viz. Succession Certificates, Bond of
Indemnity, Staff & Executives H.B. Finance cases etc.
5. To prepare and submit all statements in respect of Suits Decreed and Executions filed
by or against the Bank for submission to concerned quarters as per proforma A to I
attached.
6. To attend all legal matters and provide assistance to the Group at Central Office,
Karachi.
7. To process proposals for enlistment of Advocates on Bank’s panel, duly
recommended by the Field Offices.
8. To maintain record pertaining to under Suit /Decreed/Execution Cases and submission
of returns to SBP on fortnightly/monthly/half yearly/yearly basis..
9. To scrutinize documents and to impart legal opinion on various property/charge,
documents, agreement..
10. Examination of Lease Agreement, Bank Guarantee and Bid Bonds.
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CORPORATE & COMMERCIAL WING OF SAM:
In order to pursue the strategic goals, following five units are instrumental which perform
various functions to achieve tactical and operational goals.
PROCESSING UNIT:
Each Area Manager of Processing Unit will attend the cases of NPL A/Cs of respective area
in line with Bank’s approved strategy.
The Area Manager will process the proposals of settlements, rescheduling / restructuring,
with or without financial relief in shape of waiver/write-off received through SAM Branches
of respective area and put up the proposals with proper Analysis keeping in view the
prudential regulations, financial aspects of defaulting borrowers and others facts about the
proposal.
The Area Manager will handle the proposals in respect of incentives to the staff on account of
Cash Recovery in terms of Bank’s Policy and put up the proposals with their Analysis.
The Area Manager examines the proposals received from SAM Branches for grant of
permission of publications, approval for sale/disposal of mortgaged/pledged assets,
deployment of security guards and formation of sale Committee where-ever required, and
submits office notes for approval of valuation and legal and misc. expenses.
The Area Managers will closely monitor and make follow up with Field Offices /SAM
Branches asking for implementation in respect of cases settled/approved by competent
authority
The Area Manager will prepare the cases in respect willful defaulters to be submitted to SBP
for issuance of 7 days notice to the borrowers/guarantors/mortgagors by the Governor, SBP,
under NAB ordinance 199.
The Area Managers will co-ordinate with Risk Management Group with regard to
implementation of BASLE II accord as per SBP directives.
The Area Manager has to make liaison with the Risk Management Group with regard to
classification of accounts and to deal with the matters relating to placement/deletion of names
of defaulters on Exit Control List (ECL), and correspondence thereon with SBP/Ministry of
Interior, Islamabad.
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DATA PROCESSING / MIS & SBP REPORTING UNIT:
The Area Manager of this Unit collects data from SAM Branches; consolidate the same for
onward submission to SBP and Management for its review as part of Management
Information system. The other functions of this Unit comprise of:1. Maintenance of data of the Classified NPL accounts.
2. Consolidation of fortnightly Performance of Recovery Position of all SAM Branches
for perusal of line authority.
3. Preparation of periodical Recovery Position for submission to SBP through Finance
Group.
4. Preparation of Information memorandum related to NPLs as desired by line authority.
NAB AFFAIRS UNIT:
The Area Manager of this Unit handles with all the matters relating to, NAB in connection
with Non Performing Loans. The other functions of this unit are summarized as follows:•
Collection, consolidation and submission of information under section 19 of NAB
Ordinance to NAB Islamabad, NAB Cell at SBP and NAB offices in Provincial
Headquarters, and maintenance of record thereof.
WRITE-OFFS & PROVISIONS UNIT:
The Area Manager of this Unit maintains the provisions held against classified accounts in
close co-ordination with RMG & Finance Group. The other functions of the unit are
summarized as follows:1. To process the request of SAM Branches for issuance credit advice against the
approved write-off loans.
2. Maintenance of proper record of all the written-off /waiver cases of the bank.
3. Providing record/files of write-off/waiver proposals approved at different levels, for
external as well as internal auditor and coordinate with them and participate in
meeting with regard to disagreed cases of write-off/waiver with BID, SBP.
4. Submission of periodical consolidated statements of write-off/waiver to SBP, Finance
Group as well as to Risk Management Group.
5. Preparation of Information Memorandum for line authority in respect of written
off/waiver cases for their review.
6. Provide necessary data to Finance Group in respect of borrowers where write – off
implemented for publications in the annual reports.
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BUDGET & ADMIN UNIT:
The Area Manager of this unit deals with operating expenses budget of 05 SAM Branches as
well as SAM Group.
The Units further deals with HR related activities of employees posted in SAM Branches as
well as in SAM Group.
Special Vigilance Wing:
Operational Risk is gaining importance in the banking industry in the wake of increasing
complexity of operations and the risks involved therein. The incidents of internal and external
frauds and forgeries are included in list of the operational risk events that have the potential
to result in substantial losses. Keeping in view the size, sophistication, nature and complexity
of operations of bank, Allied Bank of Pakistan opened a separate wing for it.
In view of the importance of frauds prevention/mitigation strategy in overall operational risk
framework and to improve the mechanism for active supervisory response, the Allied bank
has formulated the revised reporting requirement on frauds/forgeries/dacoities cases, which is
submitted to State Bank of Pakistan on quarterly bases.
Creation of Special Vigilance Unit (SVU) at Strategic Asset Management Group
The competent authority has approved and created “Special Vigilance Unit (SVU)”
previously known as “Control Unit” to monitor the Operational Loss cases of Frauds,
Forgeries and Dacoities set up at Strategic Asset Management Group SAM Group, Central
Office Karachi in January 01, 2008 in the light of decision of audit committee taken in its
43rd meeting held on October 10, 2007, to make pursuance of the cases of Frauds, Forgeries
and Dacoities.
Transfer of Special Vigilance Unit (SVU) from Karachi to Lahore:
Audit committee again decided in its 46th meeting held on July 04, 2008 that the function of
reporting of frauds, forgeries and dacoity presently being done by the Audit and Credit Risk
Review Group (ACCRG) may be transferred to Strategic Asset Management Group SAMG
effective from August 01, 2008, excepting the functions of investigations which will remain
with Audit and Inspection Group (AIG).
With the approval of competent authority, the Special Vigilance Unit (SVU) now located at
Strategic Asset Management Group (SAMG), Lahore.
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Scope of the unit, its TOR, Organogram, Staff requirements and Reporting structure was
approved by the competent authorities.
Scope of the Unit:
1. The unit will monitor all the cases of ‘Frauds’ committed by the staff exclusively or in
collusion with other where bank sustain operational losses.
2. To monitor all the cases of ‘Dacoities’ occurred at the branches/offices, carrying loss
of cash and other valuable of banks.
3. To pursue with law enforcing agencies for expeditious disposal of the cases of
Frauds/Docoities against the culprits.
4. To settle the claims with insurance co. in respect of operational losses on account of
frauds and dacoities.
5. Frauds and Forgeries reporting to the management or State Bank of Pakistan.
Term of Reference:
On receipt of initial reports about the incidents of Frauds, Forgeries and Dacoities, “Special
Vigilance Unit (SVU)” will undertake the following actions:
1. To liaison with Audit and Inspection Group (AIG) to ascertain the modus
operandi/quantum of loss and tentative names of responsible persons.
2. To visit the branch/office where incident took place, for personal verification of the
facts.
3. To make efforts for the catch hold of the culprits and to ensure that the losses are
made good by recovering the cash/valuables from them.
4. In case of no instant recovery to keep lien on the assets held by the culprits and their
associates and to execute the agreements etc.
5. To acquire the services of suitable lawyers and to coordinate for lodgment of FIR and
taking other legal steps.
6. To obtain and provide details about incident/loss and arrange lodgment of proper
claims with concerned insurance co. in case of Allied Bank Limited it is EFU.
7. To refer the cases of delinquent staff to Human Resource Group (HRG),
recommending suitable actions in accordance with rules and regulations.
8. To liaison with agencies like Police/FIA/NAB for recovery of accounts, finalization
of cases and submission of challans at concerned courts and pursue the cases.
9. Submission of Quarterly statement of Frauds/Forgeries/Dacoities on the prescribed
format to the Operational Risk Unit, Banking Surveillance Department of State Bank
of Pakistan within 15 days of close of quarter.
10. Maintenance of database of operational losses of frauds, forgeries and dacoities and
its reporting to the Operational Risk- RMG.
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11.
Appraisals and Problems at ABL:
Employees at ABL facing these problems i.e.:
Fewer Incentives:
In back offices as compared to the branches the incentives are very less given to the
employees and this arises the dissatisfaction among them.
Work Burden:
In back offices the staff is very few as compared to the work load so the few employees
bearing the more work burden and this create discomfort in them.
No Job Rotation:
Most of the employees stick to the one job for long periods and having no grip on all the
operations.
Still Manual Work:
In the some offices and wings of ABL the employees still depend on manual work which
causes slow performance.
Favoritism:
The most discouraging thing in ABL is that the promotions of employees are very late and
mostly based on favoritism.
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Chapter 2 Analysis
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SWOT Analysis
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Strengths:
1. Brand name: earned a reputation for extending quality services.
2. Allied Bank Limited was the first Muslim bank to be established in Pakistan.
3. Allied Bank Limited proudly extends its ovation over the nationwide or
internationally by opening new and more branches to facilitate the customers and
having more than 850 branches in Pakistan.
4. Allied Bank has become the first bank to participate in the Sustainability Finance
Facility of the IFC’s Global Trade Finance Programme. IFC is a member of the World
Bank Group.
5. The bank is passionate about high performance, innovation and delivering value to its
customers.
6. With a vision to make ABL one of the most technologically advanced organization in
the country with ability to provide real time services to its client the BOD embarked
to implement state of the art Core Banking Solution TEMENOS at ABL, that is
working in more than 500 locations worldwide.
7. ABL has opened the Management Development Center MDC that caters to the
growing needs of ABL staff through computerized training workshops and seminars.
8. Training needs analysis to be conducted on annual bases to identify training gaps.
9. ABL has the large network of ATM throughout the nation.
10. ABL do the time to time monitoring over its different wings and groups to increase
efficiency.
11. The Bank has the most experienced and the least experienced staff, which is a good
combination of experienced heads and exuberance of youth.
12. Successfully launching new Product Lines.
13. With the objective of achieving decentralization and cutting down expenses, the
decision making has been reduced from two to four tiers. 68 controlling offices,
comprising of 4 provincial, 18 circle and 46 zonal offices have been consolidated into
16 regional offices.
14. A centralized Special Asset Management Division has been established for
expeditious recovery and settlement of non-performing loans.
15. ABL offers the privilege of using thousands of ATMs of all banks without the extra
charge of Rs 15 to its customers.
16. At ABL the customers who have more than one account can have the facility of the
same account number only the suffix is changed for the easy remembrance.
17. For employees entertainment and relaxation, ABL gives the facility that the
employees may get the 36 medical leaves and 1-month vacation in one year with their
pay.
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Weaknesses:
1.
2.
3.
4.
5.
6.
ABL did not introduce any Islamic product.
The controls of Heads are not effective.
In spite of the presence of technology many jobs are done manually.
ABL is not enhancing the new obligors.
Fewer incentives in back office as compared to the branches.
ABL credit group do not sanction the loan to the lawyers, politicians and the female
having no blood relative.
7. In back offices the employees are less so it creates more work burden on the existing
one.
Opportunities:
1. The policies of the new government to uplift the economy and pursue financial sector
reforms are expected to yield positive results in the banking industry of the country.
The ABL is well praised to avail promising opportunities.
2. As a result of different steps taken by the government regarding the betterment of the
economy, small borrowers are attracted to get the financing and start business. So, the
ABL has an opportunity to attract the customers by giving them more attracted
schemes.
3. They have wide area network in all over the Pakistan, if ABL can made it possible the
fast delivery of funds from abroad through online banking, it can cover the major
market of Pakistan which still is capturing by “Hundi”.
Threats:
1. The biggest threat in the banking sector is the continuous downfall of the country
economy since the last few years.
2. Other treat which ABL faces is the policies of the Government; tax charged on the
income of banking co. is much than the income of other companies.
3. Sudden rise and fall in the trade and industry conditions and stock exchange business
of the country also adversely affect the growth of banking sector.
4. As the situation of Frontier Province of Pakistan is not sound and ratio of dacoity
cases in branches is high so it is the big threat to the Bank.
5. The default ratio of customers who are availing the credit facilities from the ABL is
very high due to the economic recession in Pakistan.
6. Also the threat of new entrants exists there.
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Financial
Analysis:
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Vertical & Horizontal Analysis:
Vertical Analysis
2004
2005
2006
2007
9.5%
5.8%
26.2%
52.6%
2.4%
3.6%
100.0%
2008
7.0%
4.3%
22.5%
58.1%
3.0%
5.0%
100.0%
9.5%
13.1%
34.7%
34.6%
2.2%
5.9%
100.0%
8.0%
10.4%
37.0%
38.4%
1.6%
4.6%
100.0%
9.4%
3.0%
23.3%
57.7%
2.5%
4.1%
100.0%
9.8%
7.6%
18.6%
57.2%
2.6%
4.3%
100.0%
December 31
Assets
Cash and balances with treasury and other banks
Lending to financial institutions
Investments - net
Advances - net
Operating Fixed assets
Other assets
Total assets - net of provisions
2003
Liabilities
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Customer deposits
Inter bank borrowings
Bills payable
Other liabilities
Sub-ordinate loans
Total Liabilities
Share capital
Reserves
Un - appropriated profit / (loss)
Equity - Tier I
Surplus on revaluation of assets
Total Equity
97.2%
2.3%
1.5%
2.4%
0.0%
103.4%
0.9%
7.3%
-5.5%
-4.1%
0.8%
-3.4%
81.6%
8.1%
1.6%
2.1%
0.0%
93.4%
2.8%
3.0%
-4.1%
6.1%
0.5%
6.6%
83.8%
5.0%
1.3%
2.3%
0.0%
92.4%
2.3%
2.4%
1.4%
6.7%
0.8%
7.6%
81.7%
7.3%
0.9%
2.0%
1.0%
93.0%
1.8%
1.9%
2.2%
6.4%
0.6%
7.0%
82.5%
7.2%
1.1%
2.3%
0.8%
93.8%
1.7%
1.6%
2.2%
5.8%
0.5%
6.2%
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81.1%
7.6%
0.8%
3.7%
0.7%
93.9%
1.8%
1.6%
2.3%
5.7%
0.4%
6.1%
283.4%
608.0%
1040.5%
131.5%
427.3%
173.3%
562.5%
Horizontal Analysis
Assets
Cash and balances with treasury and other banks
Lending to financial institutions
Investments - net
Advances - net
Operating Fixed assets
Other assets
Total assets - net of provisions
Liabilities
Customer deposits
Inter bank borrowings
Bills payable
Other liabilities
Sub-ordinated loans
Total Liabilities
Share capital
Reserves
Un - appropriated profit / (loss)
Equity - Tier I
Surplus on revaluation of assets
Total Equity
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
110.0%
105.3%
140.7%
146.3%
98.3%
101.6%
131.8%
160.9%
37.6%
110.3%
273.5%
181.8%
113.6%
163.9%
220.8%
124.0%
115.3%
354.2%
248.3%
155.2%
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214.5%
271.4%
119.9%
206.1%
414.2%
290.8%
163.3%
272.4%
229.8%
102.8%
202.9%
523.8%
428.9%
264.4%
312.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
110.7%
470.5%
143.0%
113.1%
119.1%
414.3%
2035.7%
-97.3%
194.0%
90.3%
258.0%
141.3%
363.8%
138.1%
157.7%
146.5%
422.2%
1020.6%
42.1%
265.2%
182.8%
366.1%
180.4%
690.9%
128.5%
180.6%
192.9%
422.2%
1099.4%
86.4%
333.3%
163.0%
445.0%
231.1%
860.7%
197.1%
258.6%
247.1%
506.6%
1084.6%
107.4%
378.1%
164.3%
500.1%
260.4%
1042.5%
166.6%
480.5%
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Financial Ratios:
2004
2007
2008
Rs. in Millions
December 31
CASH FLOW STATEMENT - SUMMARY
Cash Flow from Operating Activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities
Cash & Cash equivalent at the Beginning of the Year
Effect of Exchange Rate changes on Cash & Cash equivalent
Cash & Cash equivalent at the End of the Year
FINANCIAL RATIOS
Return on equity (ROE)
Return on assets (ROA)
Profit before tax ratio (Profit before tax / Gross Income)
Gross spread ratio
Return on capital employed (ROCE)
Advances to deposits ratio (ADR) - Gross
Advances to deposits ratio (ADR) - Net
Income to expense ratio
Cost to revenue ratio
Growth in gross income
Growth in net profit after tax
Total assets to shareholders’ funds
Intermediation cost ratio
NPL ratio
Net infection ratio
Weighted average cost of debt
Capital adequacy ratio (CAR)*
SHARE INFORMATION
Cash dividend per share
Proposed bonus issue per share
Dividend yield (based on cash dividend)
Dividend payout ratio (Total payout)
Earnings Per Share (EPS) **
Price earnings ratio *** (PE x)
Market value per share - highest / lowest during the year
Book value per share
OTHER INFORMATION
Non - performing loans (NPLs)
Imports and Exports business
Number of employees
Number of branches
2003
Restated
2006
8,253
(8,512)
(12)
10,803
58
10,590
4,523
(17,183)
14,176
10,483
109
12,107
(5,893)
11,664
12,129
(21)
17,877
9,328
(4,241)
1,403
17,753
124
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24,368
46,350
(38,461)
(1,904)
24,303
65
30,353
564
(3,544)
(1,755)
29,842
511
25,618
%
%
%
%
%
%
%
Times
%
%
%
Times
%
%
%
%
%
0.34%
16%
77%
44%
36%
1.4
69.5%
14%
136%
(24.1)
3.8%
35.7%
20.93%
3.54%
-12.33%
8%
0.14%
8%
85%
8%
55%
47%
1.5
66.5%
4%
-50%
16.4
3.4%
22.0%
8.28%
2.45%
16.64%
28%
1.78%
49%
80%
28%
74%
69%
2.30
43.5%
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58%
1511%
14.9
3.0%
10.6%
3.64%
6.78%
12.17%
30%
1.98%
52%
61%
26%
74%
70%
2.43
41.1%
31%
42%
15.5
2.9%
6.91%
1.96%
9.09%
12.80%
24%
1.42%
40%
52%
21%
68%
64%
2.43
41.1%
17%
-7%
17.4
2.6%
6.36%
0.74%
9.96%
10.26%
21%
1.21%
34%
46%
19%
75%
72%
2.16
46.2%
21%
2%
17.6
3.0%
6.16%
1.46%
11.50%
10.90%
Rs.
Rs.
%
%
Rs.
Times
Rs.
Rs.
1.27
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(37.4)
0.43
23.3
2.50
2.9%
36%
4.78
12.6
86.5
32.4
2.50
2.00
2.7%
46%
6.80
9.5
93.5
39.4
3.00
2.50
2.00
1.00
2.3%
8.0%
66%
54%
6.31
6.43
17.2
4.9
130.2
31.3
36.9
34.6
Rs. in millions
Rs. in millions
Nos.
Nos.
17,833
56,868
6,859
752
15,383
72,765
6,768
735
12,699
96,072
6,909
741
10,479
113,571
7,139
742
11,355
13,772
150,698
194,186
8, 181
8,325
757
766
2005
Future Outlook:
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The global financial crisis has its effects trickling down to the banking system. The
financial sector is facing its lows but still on its comparative basis its better than other
neighboring countries owing to regulations and role of SBP to take timely corrective
measures. Measures include relaxation of CRR and SLR in phases.
The banking sector’s spread continues its rising trends after witnessing a dip to the level
of 6.78% in June 2008 that has been taken as an after effect of minimum profit payment
of 5% on saving accounts. The profits shows that long term investment in Pakistani
banking system will be lucrative, as the asset quality is quite satisfactory.
Challenges faced by the economy in general and banking sector in particular, include
restrained liquidity, slowdown of economic activities and high inflation. Despite of these
issues, ABL has been able to maintain its profitability and equipped to face challenges
with its dynamic management and trained workforce.
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Chapter 3 Internship Activities
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Weekly Activities:
First week:
In the first week of my internship training I have worked on the process flow chart of fraud,
forgery and dacoity. I have learnt how the reporting procedure of frauds, forgeries and
dacoities has done? The process flow chart of reporting of any incident about frauds and
dacoits in Allied Bank of Pakistan is here:
a. Cases of frauds/forgery and gross negligence in CRBG or CIBG branches:
Detection of incident
Immediate intimation to GCA and CRRG
by the line management compulsorily within 1 working day
from the occurrence /detection of the incident
Finalization of detailed audit report on
the incident by Audit and CRRG
Audit Report/findings to be sent to the
legal cell of SAMG by A&CRRG
Legal Cell of SAMG to draft the Charge Sheet,
to be vetted by the lawyer and sent it to the
respective Regional Head CRBG with three working days
The alleged employee shall have seven
days to respond to the Charge Sheet
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Internship Report 2009
Reply received from alleged employee on
Charge Sheet, to be forwarded by the
Regional Head CRBG directly to the enquiry
committee within two working days with copies to SAMG
Enquiry committee to conduct an enquiry
within 1 week of the receipt of charge sheet
from alleged employee through the
Regional Head CRBG
The Central Administration Action Committee
to meet on the First and Third Wednesday
of each month, review the case, takes the
decision within 2 weeks of report enquiry
Punishment is communicated & verdict
implemented within 1 working day of the
decision of The Central Administration
Action Committee
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2nd week:
Reporting Structure Of Fraud, Forgery & Dacoity:
➢ Whenever an incident of fraud forgery and dacoity takes place the concerned Regional Head/
Head Branch Operations or Group Head or Regional Operation Manager will immediately give
such information to the Head of “Special Vigilance Unit (SVU)”.
➢ After getting the documented information SVU makes the “Office Note” of the whole incident
and mail one copy to the SP&MC, Group Chief SAM, Group Chief CBRG, regional head and the
branch as well. During the first week of my internship training I have write 7 Office Notes after
reviewing the audit report and the document that send the concerned branch. One of the Office
Notes that I made is scanned here and also attached in annexure.
OFFICE NOTE:
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Internship Report 2009
➢ Also SVU immediately issue the emergency report of the incident to Management and State
Bank of Pakistan SBP in specific terms and conditions within the duration of 72 hours otherwise
State Bank of Pakistan will Charge the Penalty to the bank.
➢ The concerned Regional Head/ Head Branch Operations or Group Head or Regional Operation
Manager after that submit the FIR to the SVU.
➢ Audit and Inspection Group (AIG) will immediately be contacted to depute a team to make a
thorough probe and to submit the investigation to SVU.
➢ SVU immediately report the Insurance Co. i.e. EFU for the claim.
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➢ Insurance co. (EFU) then appoints a surveyors and report it to SVU. Surveyors should submit the
survey report with policy documents within period of 60 days.
➢ The following documents are required for the survey to the surveyors:
1.
2.
3.
4.
5.
6.
7.
8.
Log Book (one month record)
Cashier’s daily memo book
Cashier’s daily cash position
Copy of all cheques/credit slips/withdrawal of log book
Detailed statement of happening by the branch manager
Attested copy of FIR.
Policy Progress Report
Claim from duly filled in, signed and stamped
➢ After the survey report of surveyor Chief Manager of the concerned branch submits the Police
Progress Report to the surveyor so that insurance claim will be finalize.
➢ During this process of Final Police Progress report SVU requested to release 80% of insurance
claim under banker’s blanket insurance policy and 20% after the submission of Final Police
Progress Report to the surveyor. Insurance co. (EFU) deducts the charges of insurance policy i.e.
Rs.50, 000 and bank transfer this loss or write off this amount to the “Expense Account” to
balance the figure of “Suspense Account”.
Claim Lodged
Less: Policy Deductible
Net Loss
Less: 80% received & reimbursed to bank
Balance 20% receivable
Rs.
8,001,200
50,000
7,951,200
6,360,960
1,590,240
➢ Then enclose the Final Police Report and request to insurance co. (EFU) to disbursement of
insurance claim under banker’s blanket insurance policy that is remaining 20%.
➢ SVU issued “Legal Letter of Subrogation” to insurance co. and granting permission that all rights
title and interests transferred to the insurance co. in the said cash that it shall now the property of
insurance co. and bank have no right on it that police did not recover and has not found yet. The
scanned copy of “Legal Letter of Subrogation” is here also attached in the annexure.
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Internship Report 2009
➢ In the case if no amount is recovered under the banker’s blanket insurance policy then at Allied
Bank certain powers are defined who have rights to write off the lost/unrecovered amount
involved in cases related to inter branch, other assets, fraud and forgeries, looting/theft of cash.
These powers are delegated to the followings:
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Internship Report 2009
Approving Authority
Group Chief Operations, Group Chief Risk Management
Group Chief, Operations with the President
Strategic Planning and Monitoring Committee (SP&MC)
Commercial Retail Banking Group (CRBG)
Board of Directors (BOD)
Powers
Rs.
500,000
Rs.
1,500,000
Rs.
5,000,000
Rs.
300,000
Rs.
500,000
➢ Such report will immediately be put up before senior Management in order to proceeds with
suggested actions.
➢ SVU will liaison with the concerned branch/office controlling tiers and the external agencies, for
lodgment of proper repots/complaints as per law and to effectively monitor the legal action as
well as the task of recovery and to submit the progress report.
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3rd Week:
All banks/DFIs are advised to submit a quarterly statement of frauds/forgeries/dacoities on the revised
format, within 15 days of the close of each calendar quarter along with a soft copy to the Banking
Supervision Department.
The quarterly report includes all actual as well as attempted fraud cases even if the bank may not have
sustained any monetary loss. Therefore, cases where bank recovers the entire amount involved and does
not suffer any loss must also be reported to SBP.
Furthermore, banks/DFIs l separately report to this Department all material incidents of
frauds/forgeries/dacoities etc. of Rs. one million and above on urgent basis as under:a) Preliminary report within 2 working days of the occurrence of such incident by mentioning the date of
the incident and other information about the case as available at the time of such reporting; and
b) Detailed report within 15 days of the occurrence of such incident on the format.
I prepared the quarterly report of Fraud, Forgeries and Dacoites of Allied Bank of Pakistan that submitted
to the State Bank of Pakistan for the 2nd Quarter of 2009 that is ended at June 30, 2009. The report was
submitted on July 17, 2009 to the State Bank of Pakistan.
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Internship Report 2009
ANNEXURE “A” (FORM-I)
ANNEXURE "A" (Form-I)
ALLIED BANK LIMITED,
Special Vigilance Unit, SAM Group
HEAD OFFICE, LAHORE
SUMMARY POSITION OF CASES OF FRAUDS /FORGERIES /DACOITIES FOR THE QUARTER ENDED
30.06.2009
1
Cases Detected prior to the
quarter under report which
were still outstanding at the
beginning of this quarter (
including those closed during
the quarter)
a
b
c
d
e
f
g
h
i
0
No of cases
Total amount originally
involved
Adjustment to amount
involved during the quarter***
Total recoveries prior to the
quarter under report from old
cases
Recoveries made during this
quarter from cases
outstanding prior to the
quarter
Insurance
Other sources
Progressive Total Recovery
(1d+1e)
Total amount still recoverable
(1b+1c-1f)
Provision held against (1g)
above
Provision held against (1g)
above during the quarter
Expected Recovery from
Insurance
Other sources
1) Serious
frauds
cases 10
(M) and
above*
2. Medium
severity
cases 110(M)*
3) Low
severity
cases
below
1( M)*
All No
progress
cases **
Total
(1+2+3)
11
23
28
23
62
795.906
84.285
11.363
758.488
891.554
0.000
0.000
0.000
0.000
58.574
25.218
4.438
2.032
88.230
0.000
0.000
2.507
0.350
0.312
0.435
2.819
0.785
2.819
0.785
91.834
58.574
28.075
5.185
5.636
737.332
56.210
6.178
752.852
400.427
0.000
43.113
10.546
5.334
0.321
446.388
10.986
10.867
302.423
415.959
39.345
19.722
3.903
3.022
317.758
438.698
345.671
438.703
-
799.720
448.874
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Internship Report 2009
2
All Cases Detected during the quarter
under report (Whether detected and closed
in the same quarter)
a
b
c
No of cases
Total amount originally involved
Total Recoveries made, from any source
against the cases detected during the
quarter under report
1)
Serious
frauds
cases
(10M and
above*
0
0.000
2. Medium
severity
cases 1-10
(M)*
0
0.000
3) Low
severity
cases
below 1
(M)*
7
1.210
All No
progress
cases **
Total
(1+2+3)
0
0
7
1.210
Insurance
0.000
0.000
0.000
0.000
0.000
Other sources
21.382
0.000
1.210
0.000
22.592
d Total amount still recoverable ( 2b-2c)
-21.382
0.000
0.000
0.000
-21.382
ANNEXURE
"A" (Form-I)
e Provision made against (2d) above
0.000
0.000
0.000
0.000
0.000
ALLIED
BANK
LIMITED,
f Expected recovery from:
Special Vigilance Unit, SAM Group
Insurance
0.000
0.000
0.000
0
0.000
HEAD OFFICE, LAHORE
Other sources
18.950
0.000
0.000
0.000
18.950
SUMMARY POSITION OF CASES OF FRAUDS /FORGERIES /DACOITIES FOR THE QUARTER ENDED
30.06.2009
ANNEXURE “A” (FORM-I)
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Internship Report 2009
ANNEXURE “A” (FORM-I)
All cases closed during quarter under
report
a
All No
progress
cases **
Total
(1+2+3)
c
d
e
Insurance
Other sources
Total recoveries (3c+3d)
0.000
0.000
0.000
0.937
0.750
11.400
0.000
1.210
1.929
0.573
1.71
12.613
0.937
1.960
13.329
f
g
h
Total amount recoverable before closure
of cases ( 3b-3e)
Write off against provision
Direct write off
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0
0.000
0.000
0.000
2. Medium
severity
cases 1-10
(M)*
3) Low
severity
cases
below 1
(M)*
All No
progress
cases **
Total
(1+2+3)
Cases outstanding at the end of quarter
under report
a
4
3) Low
severity
cases
(below 1
M)*
2) Medium
severity
cases 1-10
(M)*
No of cases
Total amount originally involved ( after
all adjustments to original amounts)
Total recoveries prior to the current
quarter
Recovery during the current quarter from:
b
3
1)
Serious
frauds
cases (10
M and
above)*
0
b
No of cases (1a+2a-3a) 1
Total amount originally involved ( 1b+1c+2b3b)²
5
9
14
14
0.000
11.400
1.929
12.613
13.329
0.000
9.713
0.719
10.33
10.432
1)
Serious
frauds
cases
10(M) and
above)*
11
18
26
9
55
795.906
72.885
10.644
745.875
879.435
c
Total cumulative recoveries including this
quarter recoveries (1f+2c-3e)³
79.956
16.675
4.466
-6.977
101.097
d
Total amount recoverable (4b-4c)
715.950
56.210
6.178
752.852
778.338
e
Provision held against 4d above (1h+1i+2e-3g) 4
400.427
53.659
5.655
446.388
459.741
f
Expected recovery from:
Insurance
302.423
39.345
3.903
317.758
345.671
Other sources
434.909
19.722
3.022
438.698
457.653
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Internship Report 2009
Annexure “A” (Form II)
DETAILS OF ACTUAL/ATTEMPTED FRAUD, FORGERY AND DACOITY CASES OUTSTANDING
DURING THE QUARTER ENDED 31.03.2009
Fraud classification (Enter Code)
S
#
Fraud
Identificatio
n Number
1
2
1
0501430100
1
2
0501300000
1
Name
of
Branch
&
Provinc
e
3
Khori
Garden
Branch
merged
with
Jodia
Bazar
Branch,
Karachi
Sindh
Kaghzi
Bazar
Branch
merged
with
Bomba
y Bazar
Branch,
Karachi
/ Sindh
Natur
e
Individu
al
Involved
Amoun
t
Involve
d
Is it an
Emergenc
y
Reported
Fraud
Case
4
6
7
8
9
10
03'
02'
01'
Old case
19.09.01 to
25.09.01
25.10.01
09'
03'
01'
Old case
2000 to
2002
26.09.02
Date of
Commitme
nt of Fraud
Date of
Detectio
n
Total
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Internship Report 2009
S
pecial Vigilance Unit
Annexure “A” (Form II)
DETAILS OF ACTUAL/ATTEMPTED FRAUD, FORGERY AND DACOITY CASES OUTSTANDING
DURING THE QUARTER ENDED 31.03.2009
Recovery from other
sources
(customer/Staff
/Services provider)
Origina
l
Amoun
t
Involve
d
Adjustme
nt before
Current
Quarter
Adjustme
nt during
Current
Quarter
A(1)
A(2)
A(3)
12
13
14
15
25.10.01
30.06.02
12.353
0.000
0.000
23.04.03
30.06.04
19.530
0.000
31.883
0.000
Date of
Completio
n of
Investigati
on
Date of
Reporti
ng to
SBP
11
TOTAL
Total
Amoun
t
Involve
d
Previous
Recover
y
Current
Recover
y
Recover
y from
Insuran
ce
(Total)
R1
R2
R3
17
18
19
12.353
0.647
0.000
9.365
0.000
19.530
0.000
0.000
0.000
0.000
31.883
0.647
0.000
9.365
A=A1+
A2+A3
16
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Internship Report 2009
Special
Vigilance Unit
Allied Bank
SAM
Group, Lahore
Ph:0
425941270
Annexure “A” (Form II)
DETAILS OF ACTUAL/ATTEMPTED FRAUD, FORGERY AND DACOITY CASES OUTSTANDING
DURING THE QUARTER ENDED 31.03.2009
Rs. IN MILLION
Progr
essive
Total
Recov
ery
R=R1+
R2+R3
20
Direct
Writeoff
Writeoff
again
st
Provi
sion
Total
Write-off
amount
Net
Amount
Outstan
ding
(W1)
(W2)
W=W1+
W2
O=A-RW
22
23
24
25
10.012
0.000
0.000
0.000
2.341
0.000
0.000
0.000
0.000
10.012
0.000
0.000
0.000
Expected
Recovery
through
Insurance
26
Expected
Recovery
through
other
sources
27
Provisio
n before
Current
Quarter
Provisi
on
during
Current
Quarter
Net
Amou
nt
(X)
(Y)
W(X+Y)
28
29
30
2.341
0.000
0.000
0.000
19.530
0.000
Case
pending in
the Court
of
Law.
Regional
Settlemen
t
Committe
e
has
deferred
the case
till Court's
decision.
19.530
0.000
0.000
0.000
21.871
0.000
21.871
0.000
0.000
0.000
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Internship Report 2009
Spec
ial Vigilance Unit
SA
M Group, Lahore
Allied Bank
Ph:0425941270
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Internship Report 2009
Annexure “A” (Form III)
PROGRESS OF OUTSTANDING FRAUDS, FORGERIES & DACOITIES CASES
DETECTED / REPORTED IN PRIOR QUARTERS
(Serious ( 10 M & above), Medium Severity Cases (1 M & above)
Fraud Identification No 05027906001
Pending with
Court /Police.
Insurance Claim
Lodged
Status
Action against the
staff if any.
Is there any progress on case
in the quarter, if no, then why.
If progress was made then
present position of the case.
NAB
M/s. Adamjee Insurance company Ltd., declined the bank claim.
However, negotiation with officials of Adamjee Insurance
Company is under way for reconsideration of bank claim.
Mr. Muhammad Shoaib, Cashier, dismissed from bank's services.
Mrs. Saira Ali OG-III, dismissed from bank's services.
Mr. Atta ur Rehman, OG-III, dismissed from bank's services.
Mr. Faisal Riaz OG-II, dismissed from bank's services.
Mr. Munir Ahmed Awan OG-II, dismissed from bank's services.
Mr. Yasir Mehmood OG-II, letter of reprimand issued.
Yes there is progress.
Negotiations with the top management of M/s Adamjee Insurance
Company are under way for reconsideration of bank insurance
claim.
The bank has taken up the matter with NAB for declaring the
culprit as proclaimed offender.
Claim of the few claimants has been settled.
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Internship Report 2009
ALLIED BANK LIMITED
DETAILS OF ACTUAL /ATTEMPTED FRAUDS / FORGERIES/ DACOITIES CASES SERIOUS &
MEDIUM SEVERITY CASES DETECTED /REPORTED DURING THE CURRENT QUARTER
Fraud Identification Code. 05024909001
FIELD
DESCRIPTION
Detail of staff at fault
(Name & NIC)
Ms. Seher Rana (MG-11 Holder of master Key of Locker) found negligence.
CNIC #36302-8410863-8
Modus Operandi of case
Reason for the time lag,
if any, i.e. not reported
the case in the quarter
in which case was
detected & reasons if the
investigation not
completed within 30
days of detection
Pending with Court /
Police
Stat
us
Insurance Claim
lodged
Action against the
staff if any
Any other
Mr. Syed Haider Chiragh Kazmi maintaining PLS/B visited the
branch on 26-04-09 operated the locker #245 and reportedly
placed gold ornaments there in. On 18-04-09 Mr. Murad
Kazmi S/o Syed Haider Chiragh Kazmi (additional authority)
operated locker # 245 Mrs Seher Rana, Officer arranged
operation of locker. After operating it, he left the branch
without informing to the staff. Later
on, he came back with his father. Both disclosed that the
gold ornaments weighing about 45 tolas amounting to
Rs.1.100(M) were not available in their locker #245. The
locker was got operated again in the presence of Manager/
Locker In-charge and found empty.
In time reporting to SBP
----Insurance claim lodged.
Under process.
---
Steps taken to avoid such
incidents in future
All the concerned staff of the branch has been advised to ensure enforcement
of the Bank’s laid down system/procedures in letter and sprit regarding
operation of lockers under their jurisdiction in order to avoid recurrence of
such instance in future.
Points for consideration of
SBP, if any.
----
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Internship Report 2009
Annexure “A” (Form IV)
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Internship Report 2009
Annexure “A” Form “V”
Special Vigilance Unit
SAM Group, Lahore
DETAILS OF ACTUAL/ATTEMPTED FRAUDS/FORGERIES/DACOITIES CASES
DETECTED/REPORTED
DURING THE CURRENT QUARTER ENDED 30.06.2009 (LOW SEVERITY CASES
BELOW RS.1.000 (M)
Fraud Classification (Enter Code)
Date of
Commitment
Date of
Detection
(6)
Nature
&
Branc
h
Busines
s Line
Individu
al
Involved
Amount
Involve
d
(1)
(2)
(3)
(4)
(5)
01 &
Shers
hah,
Karac
hi.
B-05
01
03
00-03-2009
Reason
for
the
time tag if
any
i.e.
not
reporting
the case
in
the
quarter in
which
it
was
detected
(7)
07-04-2009 In time
reporting
to SBP
Modus
Operandi
Staff
Involved
(Name &
CNIC)
(8)
(9)
Pocketing in
Utility bills
collection by
Tousif
Khan/Teller
Tousif
Khan/Tell
er
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Internship Report 2009
Annexure “A” Form “V”
Special Vigilance Unit
SAM Group, Lahore
DETAILS OF ACTUAL/ATTEMPTED FRAUDS/FORGERIES/DACOITIES CASES
DETECTED/REPORTED
DURING THE CURRENT QUARTER ENDED 30.06.2009 (LOW SEVERITY CASES
BELOW RS.1.000 (M)
Amount
Involve
d
(10)
0.429
(M)
Pendin
g with
Court /
Police
(11)
---
Insuran
ce
claim
lodged
(12)
---
Action
against
staff if
any
(13)
Enquiry
against
the
delinquent
staff is
under
process.
From
Insuranc
e Co.
(14)
----
From
other
sourc
es
(15)
0.429
(M)
Amount
outstandi
ng
(16)
---
Prov
ision
mad
e
(17)
---
Net
Amou
nt
(18)
Steps taken to
avoid such
incidents in
future
(19)
-----
Institute of Business & Information Technology
All branches have
been advised to
ensure bank’s laid
down procedure /
systems for the
collection of
utility bills.
Internship Report 2009
STAFF DATA
Annexure A (Form VI)
(Convicted or Acquitted During the Current Quarter Under Report)
Fraud Identification Number:
05016108001
Field.
Description.
Name of Branch.
Hyderi Market Branch, Karachi
Amount Originally Involved.
Rs.86.691(M)
Name of Staff.
Mr. Muhammad Aslam Khan
Father's Name.
Muhammad Ibrahim Khan
42101-9396910-5
CNIC No.
Designation/Grade.
MG-08/Manager
Nature of appointment.
(Permanent/Contract etc.)
Permanent
Period of Service.
26 Years
Action taken along-with the
date to take effect from.
Dismissed from bank’s service vide
letter No.CO/HRG/CAAC/09/ 1868
dated 31.01.2009
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Internship Report 2009
5th Week:
During the 5th week of my internship training in Allied Bank of Pakistan, the task of maintain
complete and comprehensive database of all the pending and withdrawal cases of frauds,
forgeries and dacoity since 2005 to till date is assigned to me and I have completed that
project within one week successfully.
6th Week:
During the 6th week of my internship training I have prepared the report of detailed insurance
claim lodged how much rejected from them, overall position of insurance claims and the
detail of the settled claims some of them is mentioned there.
ALLIED BANK LIMITED
SPECIAL VIGILANCE UNIT, SAM GROUP, LAHORE
DETAIL OF INSURANCE CLAIMS WHICH HAVE BEEN REJECTED BY ADAMJEE INSURANCE CO DURING THE YEAR 2009.
Sr
No
Branch
Name
Amount
Involved
Amount of
Claim
Declined
Loss No
1
Napier Road,
Lahore
45.000
45.000
05/C/367/002643/12/2003
2
The Mall,
Murree
56.869
56.869
05/C/367/002860/06/2006
Total
102.486
102.486
Reasons
Gross negligence at the part
of branch does not cover any
clause of the insurance policy.
However, insurance company
offered to pay Rs. 22.500 (M)
to Group Chief SAM during
the meeting dated 24.05.2006
held at Adamjee House,
Karachi, which was declined
by
the
then
Bank’s
Management
as
they
demanded 100% claim of loss
amount.
The claim rejected due to
violation of bank staff’s
rotation policy.
Gross negligence at the part
of CRBG, Islamabad by
instructing
Mr.
Yasir
Mahmood, the new Manager
to take charge and issue a
relieving letter to the culprit
Manager, Mr. Muneer Ahmed
Awan without verifying the
records despite the lapse of
two weeks.
Institute of Business & Information Technology
Internship Report 2009
OVERALL POSITION OF INSURANCE CLAIMS UP TO 31-07-2009
SETTLED CLAIMS WITH M/S EFU GENERAL INSURANCE COMPANY
Natu
re of
incid
ent
No.
of
Settl
ed
Clai
ms
Amou
nt
Invol
ved
Cash
Recove
ry
(Culpr
its)
Amou
nt
Receiv
ed
from
Insura
nce
Co. up
to 3112-08
1
Dacoi
ty
Fraud
&
Forge
ry
Total
:-
2
3
22.94
2
4
5
15
Amou
nt
Recei
ved
from
Ins.
Co.
01-0109
to
31-0709
6
100%
Claim
Amou
nt
Receiv
ed
from
Insura
nce
Co.
7
Rs. in Million.
O/S
Policy
Total
Amount Deducti (4+7+8
to be
ble
+9)
Written Amoun
-off as
t
Policy
Alread
Deducti y
ble.
Writte
n-off
8
9
10
1.200
15.011
4.981
19.992
0.650
1.100
22.942
03
4.576
0.000
1.560
2.416
3.976
0.600
0.000
4.576
18
27.51
8
1.200
16.571
7.397
23.968
1.250
1.100
27.518
OUTSTANDING INSURANCE CLAIMS WITH M/S EFU GENERAL INSRUANCE
COMPANY
Rs. In Million
Nature of Incident No. of Claims Claim
Amount
Dacoity
02
2.695
Fraud & Forgery
14
350.322
Total:-
16
353.017
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Internship Report 2009
DECLINED CLAIMS BY M/S EFU GENERAL INSURANCE COMPANY
Nature of Incident
No. of
Claims
Looting cases in Kohat/ Mingora Branches under
Terrorism/Operation
Fraud & Forgery Cases:
Total:-
Loss
Amount
06
70.821
06
14.318
12
85.139
LONG OUTSTANDING CLAIMS WITH M/S ADAMJEE INSURANCE COMPANY
Nature of Incident
No. of Claims Claim Amount
Dacoity
01
0.466
Fraud & Forgery Cases:
08
73.679
Total:-
09
74.145
DECLINED CLAIMS BY M/S ADAMJEE INSURANCE COMPANY
Nature of Incident
No. of Claims Claim Amount
Dacoity
00
0.000
Fraud & Forgery Cases:
03
102.486
Total:-
03
102.486
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Internship Report 2009
Special Vigilance Unit, SAM Group, Lahore
DETAIL OF 100% SETTLEMENT OF INSURANCE CLAIMS DURING THE YEAR 2009 WITH M/S EFU GENERAL
INSURANCE COMPANY IN RESPECT OF DACOITY CASES
Sr
.
N
o
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Date of
claim
lodged
Amount
involve
d in
Dacoity
/ Claim
Lodged
Cash
Recover
y
(Culprits
)
Metrovill,
Karachi
02.08.200
7
3.343
0.000
Hassan
Abdal
Azizabad,
Karachi
Kashmir
Road,
Lahore
Nazimabad,
Karachi
06.09.200
7
22.09.200
7
1.471
0.000
2.543
0.000
0.600
0.000
1.698
0.000
2.050
0.600
Name of
Branch.
Pattoki
Khadimaba
d, Mir Pur,
(A.K)
Public
School,
Haydrabad
Survey
Centre,
Karachi
Hafizabad
Road,
Gujranwala
D.C. Road
Gujranwala
Regency
Apartment,
Karachi
Sanda
Road,
Lahore
Kotri
Baba-eUrdu,
Karachi
Total:-
11.12.200
7
16.11.200
7
26.11.200
7
31.12.200
7
Amount
receive
d from
M/s
EFU Up
to 3112-2008
Amount
Receive
d from
M/s EFU
from 0101-2009
to 31-072009
2.654
0.664
1.157
0.289
1.980
0.538
0.460
0.115
1.339
0.334
1.120
0.280
0.658
100%
Claim
Amount
Receive
d from
M/s EFU
O/S
Amount
to be
written
off as
Policy
Deductibl
e
3.318
0.000
1.446
0.025
0.000
2.518
0.025
0.000
0.575
0.000
0.025
1.673
0.000
1.400
0.050
0.633
0.000
0.025
0.798
0.000
0.250
1.632
0.000
0.250
Amount
Already
Writtenoff as
Policy
Deductibl
e
0.025
0.025
0
0.000
0.507
31.03.200
8
1.048
10.04.200
8
1.882
13.06.200
8
2.912
20.06.200
8
25.06.200
8
2.067
0.000
0.445
0.000
25.07.200
8
0.427
0.000
16.09.200
8
04.11.200
8
0.762
0.000
1.036
0.000
22.942
1.200
0.126
0.000
0.638
0.160
0.000
1.306
0.326
0.600
2.062
0.250
0.000
1.650
0.412
1.454
0.363
0.156
1.817
0.000
0.250
0.195
0.250
0.000
0.177
0.250
0.000
0.737
0.025
0.000
1.011
0.025
0.000
19.992
0.650
1.100
0.039
0.000
0.177
0.590
0.147
0.000
1.011
15.011
4.981
Institute of Business & Information Technology
Internship Report 2009
7th & 8th Week:
The last two weeks of my internship training I have worked in Regional Commercial &
Retail Risk Group as a Credit Analyst. During these days I have learnt how to analyze the
credit proposal and on what ground the credit lines and loan sanction to an obligor. What are
the criteria and documents necessary and how these are analyzed.
The process of sanctioning a loan in Allied Bank Limited is as follows:
Concerned Branch Initiate Credit Application (CA)
Send it to
Regional Head of the Concerned Branch
According to the Exposure Limit Send to the 5 levels of CRR
Levels Analyze the Queries & Approve for the Sanction
Send Copies to
Regional Head Credit Administration Dept
Concerned Branch
Issue
BFL
Send to CAD
Issue DAC
Sanction
(Bank Facility Letter)
Customer/Obligor
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Internship Report 2009
Credit Approval Matrix:
The credit approval matrix detailed herein is devided into two sections.
1. Approval Grid- defines the maximum approval authority assigned to six levels of
authority in the bank on a per party and group basis.
1. Per Party Limit- further divided into inner limits for lending against Agri Finance,
Security Types S1, S2, S3.
1. Approval Parameters-illustrate various terms and conditions applicable on different
lending products.
Credit Approvable Process Workflow:
Approval Grid
Leve
ls
I
II
Members
III
IV
BM/CM +RH RCRR
RH CRBG+ Manager RCRR
Manager RCRR+Head Asset
Marketing
Group Head CRBG
V
GC CIBG
VI
President
Security Type
S1
S2
S3
10
0
0
25
10
0
Agri
Financ
e
0.5
5
Per
Part
y
10
25
Grou
p
10
25
100
50
50
50
100
100
200 100 100
100
200
200
100 100 100
0
0
0
1000 1000 3000
All amounts exceeding level V as per
Prudential Regulations
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Internship Report 2009
Credit Approval Parameter Process Workflow:
Approval Parameter
A. Term Loan &
Agriculture Finance
Term Loan
(Exceeding One Year)
Maximum Tenor for
Term Loan
Maximum Tenor for
Agri Finance
B. Watch List &
NPLs
Approval of watch list
with or without
Rescheduling/Restruc
turing
Approval of NPLs
without
Rescheduling/Restruc
turing
Approval of NPLs with
Rescheduling/Restruc
turing
C. Guarantees
Guarantees
Level I
Level
III
Level
IV
Level
V
Level
VI
Allowed
Allowe
d
Allowe
d
Allowe
d
0 2Yr
3yr
5yr
8yr
Any
3yr
5yr
5yr
8yr
Any
Level II
100% Against
Security Type
0 S1
3yr
50 >50
>50
Allowe
10 d
Allowe
d
Please refer to the
policy
100%
Cash
Margin/li
en on
ABL
Deposits
a) upto Rs
25M against
100% Cash
Margin/lien on
ABL Deposits
b) upto Rs
10M against
25% Casah
Margin on ABL
Deposits and
balances
against
security type
Allowed
Allowe
d
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Allowe
d
Allowe
d
Internship Report 2009
S1 or Parri
passu
Mortgage on
Land & Bld.
Maximum Tenor for
Guarantees
3yr
3yr
5yr
Financial Guarantees
Back to Back
Guarantees
against Exposure
Continuing
Guarantees
D. Letter of
Credits
Letter of Credits
Allowed
100%
Cash
Margin
100%
Cash
Margin/li
en on
ABL
Deposits
Usance LC:
Allowed
a) upto Rs 25
M against
100% Cash
Margin b) upto
Rs 10 M
against 25%
cash Margin
on ABL
Deposits &
balances
against
security type
S1 or Parri
Passu
Mortgage on
5yr
Allowe
d
8yr
Allowe
d
Any
Allowe
d
Allowe
d
Agains
t
Securi
ty
Type
S1
Allowe
d
Agains
t
Securi
ty
Type
S1
Allowe
d
Agains
t
Securit
y Type
S1,S2,
S3
Allowe
d
Allowe
d
Allowe
d
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Internship Report 2009
land & Bld
LC for import of
new machinary &
Perishable items
E. Leasing
Leasing
Min Cash Margin
Against Leasing
Max Leasing
Tenor for
Vehicles
Max Leasing
Tenor for
Machinery
F. Others
New Customer
exposure
Startup Venture
Underwritting
Commitments
Interbank
Treasury Lines
Investment in
TFCs
Lending Against
Shares
100% Against
Security Type
S1
Allowed
Allowe
d
Allowe
d
Allowe
d
Allowed
Allowe
d
Allowe
d
Allowe
d
15%
10%
5%
5%
3yr
Allowed
Security
type S1
Allowed
Security type
S2
Allowed
Security
type S3
5yr
5yr
>5yr
5yr
5yr
>5yr
Allowe
d
Allowe
d
Allowe
d
Allowe
d
Allowe
d
Allowe
d
Allowe
d
Allowe
d
To be approved by the Treasury jointly with level
Allowe
d
Allowe Allowe
d
d
Clean Lending
Security Description:
S1
1
2
3
Cash/Near Cash
100% Cash Margin
Lien over Deposit
Lien over Registered Govt Securities
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VI
Allowe
d
Allowe
d
Allowe
d
Internship Report 2009
S2
S3
4
Pledge /Lien over FEBCs/Bearer/Registered US $ Bonds issued
by Govt of Pakistan
5
Mortgage of Rural Property through pledge of agri pass book
6
7
joint registration of vehicles
Mortgage of urban Property
1
Pledge/Fixed Assets
Pledge of goods imported under Sight LC issued by Abl
2
Pledge of locally produced agricultural commodities
3
4
Parri Passu Mortgage on Land And Building
Lien over Deposit with a minimum rating of B
1
2
Fixed Assets/Current Assets/Shares/TFCs
Parri passu charge on current assets
Parri passu hypo charge on plan & machinery
3
pledge of stocks imported under non ABL LC/finished goods
4
5
6
7
Parri Passu Mortgage on Land & Building
Shares & Closed Ended Mutual Funds
Term Finance Certificates
Pledge on locally produced goods
Borrowers Evaluation (Pre-Sanction Stage):
1. Objectives of Analyzing the Information:
•
•
•
•
•
To determine the strong points
To reveal the weaknesses
To learn about operations peculiarities of the business firms
To determine crucial/vital factors for the continuing success of borrower’s
business
To determine as to whether the prospective borrower can timely repay the
requested finance from the stated sources of funds without
financial/operational difficulties
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Internship Report 2009
Getting complete information about a tentative borrower is possible through random
collection of information from different resources and clubbing them together to understand
their business position on the following points.
•
•
•
•
•
Financial position
Method of operation
Management policies
Future plans
Product quality
As a credit analyst the following documents are essentially analyzed or to keep in view for
sanctioning the credit:
1. Credit Application
I.
Exposure Summary:
The exposure summary contains the following information about obligor:
1. Credit Application (CA) type- it may be annual, interim, initial & classified.
2. Credit Application (CA) No.
3. Date of Review
4. Obligor Name
5. Extending Unit
6. Control Unit
7. Signature and Stamp of Concerned BM/CM/RM/GRM
8. Information about exposure limit- how much the obligor is already requiring
and also his proposed limit with increment or decrement
9. Exposure summary whether it is “Fund Base: or “ Non Fund Base”
10. Obligor risk rating internal or external
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Internship Report 2009
11. Obligor classified exposure if it is in
•
•
•
•
Watch List- the amount is overdue more than 30 days ,
Substandard- the amount is overdue more than 90 days,
Doubtful- the amount is overdue more than 180days &
Loss- the amount is overdue more than 365days
1. Stability criteria whether the obligor previously breach or violate any essential
requirement e.g. Prudential regulation breach, Covenant violation
2. TER Temporary Extension Request
3. Approved by the Manager RCRR and recommended by RH-CRBG
I.
Sanction Advice:
The Sanction Advice contains the following information about obligor:
1. National Tax No. of obligor
2. Industry type
3. Industry Code
4. Business Segment- whether SME, Commercial
5. Legal entity i.e. Sole Proprietor, Partnership, Co.
6. Total Asset of Obligor and the Turnover
7. Type of Credit Facility, the Obligor is obtaining previously and extending as well
8. Pricing according to SBP and Bank Policies-Floor Pricing i.e. KIBOR three
month average +Spreads fixed by SBP
9. Margins
10. Personal Guarantees
11. Securities detail whether same or changed
12. Charge on Securities, Margin on Securities, Collaterals and its For Sale Value &
Market Value
13. Covenants
I.
Group Facility Summary:
If the Obligor is not individual then Group Facility Summary is required.
II.
Basic Information Report (BIR):
The Basic Information Report (BIR) contains the following information about
obligor:
1. Obligor Name, Address & Tel. No.
2. Date of establishment of business
3. Background of obligor’s business and product details
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Internship Report 2009
•
•
•
•
•
•
•
I.
Shareholding Status- Business directors name, Shareholding whether
100% or not and Net Worth
Management- Name, Position, Tel. Nos. Remark (Age, Experience,
Qualification, and Association with the Co.)
Bank Lines- from which the obligor obtaining the credit lines.
Credit Checking from CIB- Status whether clean, overdue, default
Market Checking- At least 3 checking from the market ( from
Buyers/Suppliers/Competitors) should be made
Classification History
External Rating- ( Long term/Short term)
Credit Memorandum:
The Credit Memorandum contains the following information about obligor:
1. Purpose- describe the purpose of the proposed facility
2. Special Approvals- Provide comments for each “Stability Criterion Exceptions”
checked off on the front page of CA
3. Ways Out Analysis- Indicate for each facility, the primary, secondary way out.
4. Three year exposure Trend
5. Industry Analysis
6. Management Analysis- Provide an assessment of the integrity of the borrowers
7. Financial Analysis-Balance Sheet, P&L Account, Statement of Sources (Fund
Flow Statement), Notes on Accounts and Auditor Certificate
8. Risk Factors- Business Risk, Financial Risk, Management Risk, Security Risk,
Account Performance Risk, Environmental & Social Risk and Disaster Risk
9. Relationship Strategy- In view of the risks discussed above provide a relationship
strategy (Grow, Maintain, Reduce, Exit) for the obligor.
1. Borrower’s Basic Fact Sheet (BBFC) on approved pattern/ specimen duly filled in all
respect, duly signed & stamped by the obligor & BM
2. Form 151- Loan Application Form
3. Security Compliance Certificate SCC- confirming the security/ documentation status
for the existing approved facilities.
4. Copy of DAC in case of previous sanction
5. Latest Balance Sheet duly signed by obligor i.e. proprietor/Counter signed by CA/
duly audited as per requirements along with cash flow statements
6. Spread Sheet in case of exposure exceeding Rs. 10 M- to inculcate the practice of
determining the Short term working capital requirement and long term repayment
capacity through financial projection and cash flow analysis
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Internship Report 2009
7. Projected Balance Sheet
8. Previous/ Other Bank Report from whom the credit lines availed
9. Occupancy status of collateral security i.e. self occupied/ rental/ state commercial/
residential/industrial
10. Mark up payment history
11. Extracts from inspection & compliance
12. Ensure compliance of convent imposed in last year approval
13. Copy of Last Sanction
14. Ensure all columns of CA are filled in completely and correctly on proper prescribed
formats of the bank. All pages of CA must be signed/ initialed by the BM.
15. Ensure Principal/collateral securities meet marginal requirements.
16. Forced Sale Vale Certificate signed by RH showing occupancy status of
property/location/i.e. industrial/commercial/residential as well as approved map held
or not. Ensure that Forced Sale Vale Certificate should not later than 3 years
17. Ensure stock report held and outstanding reported therein tally with statement of A/C
and meet marginal requirements.
18. Statement of Account for last one year and ensure satisfactory turnover.
19. Ensure personal guarantees are recommended of all concerned i.e.
proprietor/partner/directors/owner of the properties/holder of liquid securities etc.
20. Photocopies of Title Documents i.e. Title Deeds, NEC, Valuation Report, Legal
opinion, Revenue Record, Excise & Taxation record in case of fresh proposals.
21. Ensure that valuation of properties is made from the short listed panel of PBA
(Pakistan Banking Association) Evaluators in case of limits exceeding Rs.5 (M).
22. Date of Valuation-Ensure that valuation of Properties should not later than 3 years.
23. Prudential Compliance Check list must be compliance for SME, LC, Agri R8 and for
corporate R3
24. In case party is also dealing with other banks ensure copies of other banks ensure
copies of Other Bank Sanctions/Statement of A/C
25. Copy of account opening form in case of fresh proposals
26. Net Worth statements of obligor/partners/directors
27. EE Statement for borrowing in case of exporters, issued by SBP on yearly bases and
this statement reports all exports of the particular obligor was carried out through
which bank.
28. Confirm age of obligor is not more than 65 years in case of SME
29. Fresh Search Report in case of limited companies
30. Ensure the registration of charge over the Current/Fixed Assets of the Limited Co.
Call copy of Form No. 10 or 16 i.e. Registration of Charge over the Current/Fixed
Assets of the Limited Co.
31. Account Profitability Report when the limit is > 10 M- issued by the branch shows the
previous credit lines avail by the obligor, the outstanding behavior and calculated
yield.
32. Performa invoice in case of import
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33. Form 29 i.e. Board resolution of limited co.
34. PDO Post Due Obligation of the obligor
35. Undertaking or confirmation for proper utilization of loan from obligor
36. Form 20 i.e. List of Directors of private limited co.
37. Clean up of facilities- an important element of credit initiation is proper structuring
of credit facilities so as to minimize the risk associated with lending. This structuring
of facilities in terms of amount, tenor and underlying security requires a thorough
analysis of obligor’s WCR and an understanding of CCC of Co. firm. A clean up is
considered to have taken up place when the outstanding finance has been fully
adjusted repaid for a period of min 2 consecutive working days.
Credit Analysis for Sanctioning Loan to Agriculture Sector:
Furthermore the documents for sanctioning the loan for agriculture required are:
1. Zarai Pass Book- Evidence of Title
2. Latest copy of Khasara Gardawri( to check applicant is self cultivator or not)
3. Fard Jama Bandi
4. Total cultivated land (owned+ rented)
5. Lease Agreements
Limit of Agri Credit Initiation to Obligor:
Loan Entitlement
1. Valuation:
Market Value of cultivated land *50%---------------------- Maximum
Limit
2. Production Unit (PIU):
Production Unit *Per Unit Price------------------------------ Minimum
Limit
3. Owned & Leased Land:
Total Area Cultivated * As Per Circular Production Crop Price/Acre
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Internship Report 2009
Financial Analysis for Sanctioning Loan:
1.
2.
3.
4.
5.
6.
7.
8.
Equity of the Business of obligor
Past year Sales And Turnover
Current Ratio
Quick Ratio
Leverage Ratios
Cash Conversion Cycle
Work Capital Requirement = (Cost of Sales/365)*CCC
Already available WCR = Current Asset-Current Liabilities (if it is more than the
WCR then may be more enhancement is rejected)
9. Cash Flow Statement
10. Entitlement = 4* Equity
Collateral Acceptable by ABL:
Generally the following are the types of collateral acceptable by ABL are:
1. Mortgage of Land & Building:
Credit facilities against mortgage of land & building may be granted as per the
margins specified by the bank, on the forced sale value of the property
determined by PBA approved valuation firm, subject to the following
condition:
1. Max tenor of up to 7 year
2. Max grace period of up to 12 months from the date of first drawn- down.
3. The collateral must be easily realizable and must have an independent
approach and right of way.
2. Hypothecation of Stocks, Plant & Machinery:
Credit facilities against hypothecation of stock may be granted as per the
margins specified by the bank subject to the following condition:
1. Max tenor of 1 years
2. No grace period is allowed
3. Asset coverage to be monitored via monthly stock report by the borrower
showing the position of stock on month end.
4. Hypothecation to be provided on present and future stock.
5. Semiannual stock inspection is conducted
6. Annual clean up requirement may be imposed where deemed necessary
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Credit facilities against hypothecation of Plant & Machinery may be granted
as per the margins specified by the bank subject to the following condition:
1. Max tenor of up to 7 year
2. Max grace period of up to 12 months from the date of first drawn- down.
3. Hypothecation to be provided on present and future Plant & Machinery.
3. Pledge of Stocks, Raw Material & Finished Goods:
Credit facilities against pledge of readily marketable stocks, raw material and
finished goods may be granted as per margin requirements specified by the
bank subject to the following condition:
1. Max tenor of 6 to 11 months depending upon the asset conversion of the
borrower.
2. PBA approved macadam to take charge of the pledged stock and keep it
under lock & key.
3. Macadam to submit monthly stock position report.
4. clean up requirement may be imposed where deemed necessary
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Internship Report 2009
Management Style:
In Allied Bank of Pakistan, the Managers are promoting the “Open Door Banking”. They
used to interact with their subordinates and workers on time to time basis this is the main
reason the managers at ABL know the problems that their employees are facing and this time
to time interaction has created a healthy environment among the staff and their managers and
this monitoring increase the efficiency at ABL.
In ABL the managers having the control over the staff members and employees and having
the check over the tasks of employees that they are performing even on daily basis.
Although the environment is very learning but also in some wings and groups of ABL the
management approach towards their employees is still bureaucratic. Some most experienced
managers are hesitant to adopt the learning and open door banking.
Working Environment:
Allied Bank boasts of a work culture, which displays respect for all walks of life and different
ways of thinking.
Everyone at Allied Bank has a common corporate vision and values. However, all employees
are encouraged to grow as individuals and collaborate in teams.
Increments, bonuses and promotions are based solely on individual skills, qualities, abilities
and attitude. It is our aim to provide innumerable opportunities for all those employees who
show aptitude and the will to keep learning.
Training programmes, both local and foreign, are also considered important for employee
growth.
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Internship Report 2009
Chapter 4 Summary & Recommendations
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Internship Report 2009
Overall Summary:
At present there is no such organization in the world that is free from problems and
challenges. Every concern has to strive and struggle a lot to be more profitable and to get
more competitive edge.
The management of ABL is taking strategic steps to enable the bank to emerge as a strong
and progressive institution.
It is continuing to make efforts to refine its products and
operations to make them more compatible. New deposit schemes have been introduced and
an action plan to maintain revenue growth in future.
During my internship I have learned many new things in spite of the knowledge gained at
university and also came to conclusion that education alone is not enough, practical training
in every field is crucial to become a successful manager.
The bank has great image due to the trust but it needs to use it effectively to increase market
share. Also the flaws in branch operations such as misallocation of resources should be
rectified.
As the business and economic conditions remain uncertain, ABL continues to develop the
new products like it has been doing in past.
Institute of Business & Information Technology
Internship Report 2009
Recommendation for the Organization:
While doing my internship training of 8 weeks in Allied Bank of Pakistan, I have
analyzed some problem in the Bank. Keeping in views those problems followings are my
recommendations:
1. The bank has a lot of financing schemes but there are little advertisements of these
schemes so ABL should more advertise its schemes.
2. Most of the bank employees are stick to one seat only, which result that they become
master of one particular job and lose their grip on other banking operations. So all
employees should have regular job rotation.
3. Some of the talented employees should be sent to other countries for their advance
trainings.
4. In back offices the employees are still depend on manual work which causes slow
performance. It should convert their system to an automated one.
5. ABL should promote the paperless banking.
6. In some groups or wings, approach towards employees is still bureaucratic, late
promotion, favoritism in appraisals and lack of sufficient incentives are some
problems arising dissatisfaction so the employees should be promoted on fair policies
to increase more satisfaction among them.
7. ABL should introduce the Islamic products because it has the potential market.
Institute of Business & Information Technology
Internship Report 2009
Recommendation for the IBIT:
While studying in IBIT, I have analyzed some problem. Keeping in views those problems
followings are my recommendations:
1. The management of this prestigious institute should introduce the training
programmes among the departments i.e. IAS & IBA same as the UMT does with the
IBA for the promotion of students.
2. This institute also should organize the seminars with the cooperation of industries like
with Chamber of Commerce and Supply Chain Group of Pakistan that assist its
students and the market will knows its students.
3. The institute also should arrange the field tours for its students to enhance and give
the market exposures.
Institute of Business & Information Technology
Internship Report 2009
Annexure:
Institute of Business & Information Technology