Internship Report 2010

CIITLahore

Allied bank Limited Awan town, Multan road Lahore.

SUBMITTED TO: Sir. Adeel Tariq (Lecturer) SUBMITTED BY: Syed Salman Naseer BBA- sp07-071 SUBMITION DATE: 27TH MAY 2010

COMSATS Institute of Information Technology Defence road off Raiwind road, Lahore.

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Table of Contents
EXECUTIVE SUMMARY----------------------------------------------------------------------------------------------3 EVOLUTTION OF BANK--------- -----------------------------------------------------------------------------------4 VISION AND MISSION-----------------------------------------------------------------------------------------------5 CHAPTER 1:___________________________________________________________________________________________________ ORGANIZATION PROFILE History of ABL----------------------------------------------------------------------------------------------6 Objective---------------------------------------------------------------------------------------------------10 Operation Divisions ------------------------------------------------------------------------------------10 Organizational structure------------------------------------------------------------------------------12 Functional Hierarchy-----------------------------------------------------------------------------------13 Board of Directors --------------------------------------------------------------------------------------14 P Products & Services ---------------------------------------------------------------------------------15 Departments of branch --------------------------------------------------------------------------------19 CHAPTER 2:___________________________________________________________________________________________________ Competitive Strategies---------------------------------------------------------------------------------25 SWOT Analysis-------------------------------------------------------------------------------------------28 B Business Process Analysis----------------------------------------------------------------------------31 CHAPTER 3:___________________________________________________________________________________________________ MY DUTIES & ACOMPLISHMENTS -------------------------------------------------------------------32 How experience effects on career-------------------------------------------------------------------33 PROBLEMS-------------------------------------------------------------------------------------------------34 RECOMMENDATIONS------------------------------------------------------------------------------------35 BIBLIOGRAPHY-------------------------------------------------------------------------------------------38 BUSINESS JARGONS--------------------------------------------------------------------------------------38

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Executive Summary My Internship at Allied Bank Limited Awan town, Multan road, Lahore. I started on july 19 2010 and completed on 10th august 2010. During my stay at the bank I learnt a lot as the practical knowledge of the banking sector is concerned. I was rotated in different departments including clearing, account opening, and customers services foreign exchange and advances departments. I learnt the basics of operations performed in each department.

I undertook some assignments that helped me apply the learnt techniques. I faced some problems during this course, but I got full attention from the concerned persons and they always encouraged me for asking any kind of question that rose during the course of my work. On the last day, the manager gave his comments and evaluation of my work on the prescribed form provided by the institute and also certificate of internship.

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EVOLUTION OF BANKS There are different opinions that how the word Bank originated. Some of the authors opinion that this word is derived from the word Bancus or Banque, which means a bench. The explanation of this origin is attributed to the fact that the Jews in Lombard transacted the business of money exchange on benches in the market place; and when the business failed, the people destroyed the bench. Incidentally the word Bankrupts said to have evolved from this practice. Some of the authors are of opinion that the word Bank is derived from the German word back, which means joint stock fund. Later on when the German occupied major part of the Italy the word Back was italicized into Back. Definitions of Bank "A financial institution, which deals with money and credit. It accepts Deposits from individuals, firms and companies at a lower rate of Interest and gives at higher rate of interest to those who need them. A financial establishment which uses money deposited by customers for investment, pays it out when required, makes loan at interest, exchanges currency, etc. J.W Gilbert in his principles and practice banking defines a banker in these words: A banker is dealer in capital or more properly, a dealer in money. He is intermediate party between the borrower and the lender. He borrows of one and lends to another.

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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 Integrity Excellence in Service High Performance Innovation and Growth 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 Page 5

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HISTORY of ABL Established in December 1942 as the Australasia Bank at Lahore with a paid-up share capital of PKR 0.12 million under the Chairmanship of Khawaja Bashir Bux, and his business associates, including Abdul Rahman Malik who was amongst the original Board of Directors, the bank had attracted deposits, equivalent to PKR 0.431 million in its first eighteen months of business. Total assets then amounted to PKR 0.572 million. Today Allied Bank's paid up Capital & Reserves amount to Rs. 10.5 billion, deposit exceeded Rs. 143 billion and total assets equal Rs. 170 billion. The Allied Bank's story is one of dedication, commitment to professionalism, adaptation to changing environmental challenges resulting into all round growth and stability, envied and aspired by many.

1942 - 1947: Pre Independence

In the early 1940s the Muslim community was beginning to realize the need for the active participation in the field of trade and industry. The Hindus had since the late 1880s established a commanding presence in these areas and industry, trade and commerce in the undivided Sub-continent was completely dominated by them. Banking, in particular, was an exclusive enclave of the Hindus and it was widely believed, and wrongly so, that Muslims were temperamentally unsuited for this profession. It was particularly galling for Khawaja Bashir Bux and Abdul Rahman Malik to hear the gibe that Muslims could not be successful bankers. They decided to respond to the challenge and took lead in establishing this first Muslim bank on the soil of Punjab that was to become Pakistan in December 1942; by the name of Australasia Bank Limited. The initial equity of the Bank amounted to Rs 0.12 million, which was raised to Rs 0.5 million by the end of first full 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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1947 to 1974: Australasia Bank

Australasia Bank was the only fully functional Muslim Bank on Pakistan territory on August the 14th, 1947. It had been 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, Ludhaina, Delhi and Angra (Agra)) were closed down. New Branches were opened in Karachi, Rawalpindi, Peshawar, Sialkot, Sargodha, Jhang, Gujranwala and Kasur. Later it network spread to Multan & Quetta. The Bank financed trade in cloth and food grains and thus played an important role in maintaining consumer supplies during riot affected early months of 1948. Despite the difficult conditions prevailing and the substantial set back in the Banks 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 which became Bengladesh. The bank did well in despite losing lot of its assets. By the end of 1973 the bank had 186 branches in West Pakistan.

1974 to 1991: Allied Bank

In 1974, the Board of Directors of Australasia Bank was dissolved and the bank was renamed as Allied Bank. The first year was highly successful one: profit exceeded the Rs 10 million mark; 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 bank history. 116 new branches were opened during 1974 and the Bank started participation in the spot procurement agriculture program of the Government. Those seventeen years of the Bank saw a rapid growth. Branches increased from 353 in 1974 to 748 in 1991. Deposits rose from Rs 1.46 billion, and Advances and investments from Rs 1.34 billion to Rs 22 billion during this period. It also opened three branches in the UK.

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ESOP Revolution (Employee stock ownership plan)

Under the philosophy of ESOP ownership of an enterprise is transferred to its employees who are in an advantageous position in running the enterprise. The added advantage of ESOP that it strengthens the workers stake in the free enterprise system, in job securities, better profitability & unique corporate culture symbolizing family feelings & professional fraternity. September 10,1991 is the historical date as on this date the bank became the countrys 1st bank to be reconstituted as an institution jointly owned by its employees through the unique concept of Employees Stock Ownership plan [ESOP] developed by the Allied Management Group headed by Mr. Khalid Latif enabled the bank staff to react creatively to the privatization challenge. More that 7500 staff members acquired a share in the bank . The articulation of the ESOP is a landmark in the financial history of Pakistan-indeed of the entire world .It is a practical step ensuring an increase in workers participation and in productivity a means for enhancing an equitable redistribution of financial assets & an effective strategy for achieving the cherished goal of national selfreliance.

1991 to 2004: Privatization

As a result of privatization in September 1991, Allied Bank entered in a new phase of its history, as the worlds first bank to be owned and managed by its employees. In 1993 the First Allied Bank Modaraba (FABM) was floated. After privatization, Allied Bank registered an unprecedented growth to become one of the premier financial institutions of Pakistan. Allied Banks capital and reserves were Rs. 1.525 (Billion) and assets amounted to Rs. 87.536 (Billion) and deposits were Rs. 76.038 (Billion). Allied Bank enjoyed an enviable position in the financial sector of Pakistan 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 Banks ownership was transferred to a consortium comprising Ibrahim Leasing Limited and Ibrahim Group. Page 8

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Today the Bank stands on a solid foundation of over 63 years of its existence having a strfong equity, assets and deposits base offering universal banking services with higher focus on retail banking. The bank has the largest network of on-line branches in Pakistan and offers various technology based products and services to its diversified clientele through its network of more than 700 branches.

2005:
In May 2005 Ibrahim Leasing Limited was amalgamated by transfer to and vested in with and into Allied Bank Limited. ILL shareholders were issued ABL shares in lieu of the ILL shares held by them. Application for the listing of ABL shares in all the Stock Exchange Companies of Pakistan was made. ABL was formally listed and trading of the shares of the Bank commenced on the following dates. Islamabad Stock Exchange - 8th August 2005 Lahore Stock Exchange - 10th August 2005 Karachi Stock Exchange - 17th August 2005

2007:
Mohammad Aftab Manzoor has taken charge as CEO and President of the Bank on August 13 2007. He is an ex-president of MCB Bank Ltd.

Today
Today, with its existence of over 60 years, the Bank has built itself a foundation with a strong equity, assets and deposit base. It offers universal banking services, while placing major emphasis on retail banking. The Bank also has the largest network of over 700 online branches in Pakistan and offers various technology-based products and services to its diverse clientele

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IMPORTANT STATISTICS ABOUT ABL

Total customers Employees Total branches Utility booths Airport booths 4,605,000 6,747 735 34 1

MAIN OBJECTIVE
The main objective of the bank is to accept deposits and provide loans to its customers and also to be more efficient in providing services. The bank maintained its commitment to most efficient and personalized services to its customers. Allied Bank of Pakistan introduces many remunerative schemes for its depositors and introduce computer services for the first time in the banking history of Pakistan. Allied bank gives advances to small, medium and Big industries, commercial establishment, agriculture, construction companies and other needy persons. Allied bank collects electricity gas and telephone bills from public and over hundred branches of Allied Bank Ltd. deal in foreign exchange were facilities are given to financial and commercial so its ultimate objective is to receive funds from the depositors and provides loans\credit facilities to different sector including trade, industry and agriculture in its most branches. OPERATIONAL DIVISION Allied Bank has been divided into 16 regions, each under the control of a regional General Manger (RGM). The RGM is not any fixed designation in the organizational hierarchy. The person appointed for its position can be a SEVP and EVP. Page 10

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Region Abbottabad Bahawalpur Faisalabad Gujranwala Hyderabad Islamabad Karachi Lahore Mardan Mirpur (AJK) Multan Peshawar Quetta Sargodha Sialkot Sukkar

Email coablatd@brain.net.pk ro_bahawalpur@ikr.abl.com.pk ablcircle@fds.comsats.net.pk ro_gujranwala@lhr.abl.com.pk ro_hyderabad@abl.com.pk ro_Islamabad@isb.abl.com.pk ro_karachi@abl.com.pk ro_lahore@lhr.abl.com.pk allieds@brain.net.pk ro_Mirpurak@isb.abl.com.pk ro_multani@lhr.abl.com.pk ro_peshwar@isb.abl.com.pk ro_quetta@abl.com.pk ro_surgodha@lhr.abl.com.pk ro_sialkot@lhr.abl.com.pk ro_sukkir@abl.com.pk

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Internship Report 2010 ORGANIZATIONAL STRUCTURE MANAGEMENT HIERARCHY The management hierarchy represents the different positions and designations in the hierarchy of the ABL. However, this is not the reporting hierarchy but merely represents the positions and grades on the basis of seniority and grades. CHAIRMAN

CHIEF EXECUTIVE OFFICER (CEO)/PRESIDENT SENIOR EXECUTIVE VICE PRESIDENT (SEVP)

SENIOR VICE PRESIDENT (SVP)

EXECUTIVE VICE PRESIDENT (EVP)

ASSISTANT VICE PRESIDENT (AVP)

OFFICERS GROUP (OG1, OG2, OG3)

SUPPORTING STAFF

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FUNCTIONAL HIERARCHY
The functional hierarchy represents the reporting order in the hierarchy of ABL. This is the overall hierarchy of allied bank..

President and CEO

Group chief

Group head

Regional head

staff

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BOARD OF DIRECTORS Names Mohammad Naeem Mukhtar Mohammad Waseem Mukhtar Sheikh Mukhtar Ahmed Abdul Aziz Khan Sheikh Jalees Ahmed Mubashir A. Akhtar Pervaiz Iqbal Butt Khalid A. Sherwani Muhammad Raffat Designation Chairman Director Director Director Director Director Director Chief Executive Officer Company Secretary

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PRODUCTS & SERVICES In line with the Banks 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. Some products are as follow: i. Allied Visa Gold Credit Card

Welcome to the world of privileges, benefits and savings with your Allied Visa Credit Card. In order to cater to your growing financial needs we are proud to introduce Allied Visa Credit Card with The Lowest Service Charge ever! So now you can save money where it counts and spend lavishly at your favorite places with greater flexibility, convenience and most important-Affordability. With your Allied Visa Credit Card you 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, you can also use your credit card at over 1 million ATMs internationally!

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Internship Report 2010 ii. Allied Cash+Shop Visa Debit Card

You are always on the move, now your bank account is too. You can use your Allied Cash+Shop Visa Debit Card to withdraw cash directly from your bank account from over 3,500 ATMs in Pakistan - including Allied Bank's largest network of ATMs - and over 1 million ATMs worldwide. 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. iii. Internet Banking

Banking is now at your fingertips! Allied Direct Internet Banking offers you the convenience to manage and control your banking and finances - when you want, where you want! It's Simple, Convenient, Secure and Faster. So, just get clicking.

iv.

Online Banking

Allied Online Banking is a unique service being offering from Allied Bank. Through this service, your account in Allied Bank is available to you from any of our branches countrywide. v. 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

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vi.

ATM Network

Allied Bank has a vast network of over 538 ATMs installed in over 130 cities, which continues to grow at a rapid pace. vii. PLS Account

Allied Bank offers the PLS Savings Account facility to its customers with the following attractive features. viii. Attractive return of up to 5.00% per annum Free Cash Deposit / Withdrawal / account to account transfer within city. Free Online Transactions, DD/TT/PO for depositors maintaining an average monthly balance of Rs. 2.500 (M) & above. Free issuance of cheque book at the time of account opening. 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. ix. Agriculture Finance

The Bank, under the guidelines of the State Bank of Pakistan, extends short, medium and long term Agriculture credit facilities to farming community of Pakistan on easy terms to increase the credit flow to Farm and Non-Farm segments of Agriculture sector. x. Utility Bill

Customers can pay their utility bills (e.g. electricity, gas, telephone) at any of the Banks branches. Bills can be paid with cash or cheque, plus customers can even drop crossed Page 17

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cheques in drop-boxes available at all branches. Furthermore, customers can also pay their bills using any of the Banks ATMs or via Internet Banking for SSGC and SNGP bills. xi. 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. # 1. 2. 3. 4. Locker Size 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/-

xii.

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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DEPARTMENTS OF ALLIED BANK The work of allied bank can be divided into following depertments General Banking Department Accounts Department Remittance Department Clearing Department Credit Department (Advances) Foreign Exchange Department Accounts Department In this department I have observed and learned following things. Accounts department is a department which deals and checks all the activity of all the department .It also deals in expression of finance of the bank. Usually accounts are maintained in two ways: Journal system Voucher system Journal system is adopted by some commercial industrial institutions. In journal system entries are reported in journal books and then posted to ledger. Voucher system is used for every transaction. Voucher has to e prepared either in cash or in transfer or in clearing, the sheet upon which these vouchers are summarized transactions-wise and consolidated into a figure is called supplementary. Types of supplementary Debit supplementary Credit supplementary Debit supplementary is used for debit voucher and credit supplementary is used for credit voucher books and registered maintained by bank as follows. Page 19

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General ledger statement of daily affairs Cash book or cash sum day book Transfer book Income and expenditure etc Checking Banks Daily Activity (Calling) Accounts department deals and checks the entire working of the Branch; all the vouchers that have been posted at the computer are scrutinized in accounts department. The End of Day i.e. computer print is also received from the computer. The next day the activity is separated some statements from the End of Day. The vouchers are sorted out head wise. The vouchers are matched with the entries in the statements. Any abnormality if occurs, is immediately dealt with. All the vouchers and instruction are checked individually are checked individually against the computer printouts. Remittance Department In this department I have observed and learned following things. The remittance can be made through the following mode of transference. Transfer of money or equivalent to money from one branch to another branch of the same bank is called remittance. Now it is become easier and safer method both for the client and banker to transfer their money from one branch to another within the city and outside the city. Originating Branch It is the branch, which receive the instrument for remittance. Responding Branch The branch which is receives the instrument for remittance.

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Types of Remittance Remittance is classified into following four types. Inward Remittance Outward Remittance Inland Remittance Foreign Remittance Inward Remittance The branch receives the instrument directly from the customer or from the originating branch, and is responsible to pay to part is called inward remittance. Outward Remittance The branch, which issues or sold the instrument to the responding branch is, called outward Inland Remittance Transfer of money from one branch to another branch of the same bank within the same country is called inland remittance. In this case both originating branch and responding branch will be situated in the same country. Foreign Remittance Transfer of money from one country to another country is called foreign remittance. In such case may be originating or responding branch will be out of the country, and mostly conversion of foreign currency is involved. Demand Draft (DD) Telegraphic Transfer (TT) Payment Order (PO) remittance.

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Clearing Department In this department I have observed and learned following things. The bank is a member of the clearing house and receives Cheque, demand drafts and other negotiable instruments for presentation of its payment by the branch of a drawee bank located within the city other then ABL. The proceeds of the clearing facility is available on all working days. Whether the clearing facility is not available or the drawee institution in not the member clearing house the bank receives cheques, demand draft or other negotiable instruments for collection and upon receipt of payment from the drawee the same is credited into the account of the customer. Clearing may be outward or inward Inward clearing Outward clearing (a) Inward clearing Cheques of our branch that are deposited at other banks are brought to us by NIFT. This is called inward clearing. In inward clearing we DEBIT a/c of our a/c holder and CREDIT other branch. (b) Outward clearing In outward clearing cheque of other banks are presented in our branch. 3 stamps are stamped in these cheques. Clearing stamp Crossing stamp Payees a/c credited stamp Transfer delivery The clearing between the ABLs own branches within one city is called transfer delivery. During this clearing Pak account is not involved. In ABL it is done twice in a week. The bank charger no commission from its customers for this transfer delivery.

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Credit Department (Advances) In this department I have observed and learned following things. Main working of Advances department is to provide loan to corporate client in form of clean advances, against promissory notes, as well as secured against tangible and intangible securities. The banker prefers such securities that do not run the risk of general depreciation due to market fluctuations. This main job of this department is to maintain the credit limit of client, offer loan, approve loans and like other work related to corporate loan. Types of Advances Demand Finance Scheme introduced by State Bank of Pakistan for exporter of carpet, surgical instruments, at zero percent rate of interest. While banks provides at concessional rate of interest. Loan Ordinary (demand finance to students) Qurz-e-Husana Scheme loans are allowed to the students. Teachers without any interest or markup with the recommendation of the MPA or MNA. Loans for purchasing vehicles Loan equivalent to months salary.

Foreign Exchange Department In this department I have observed and learned following things. International trade is growing and with the development of international trade it has become more imperative. For countries to devote more and more attention to the complicated mechanism of foreign exchange. It is more important in case of developing countries. It is need of time that a country should conserve its foreign exchange resources.

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Internship Report 2010 Meaning of Foreign Exchange The foreign Exchange term refers to the principles that determine the rate of exchange. It covers following three senses: The mechanism or system by which international obligations or indebtedness are fulfilled. The currency of one country is exchanged for that of another. The principles on which the people of the world settle their debts to one another.

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CHAPTER:2 COMPETITIVE STRATEGY Allied Bank strongly believes that the customers can be attained and retained only by providing them the services they want. Allied banks competitive strategies are focused on making their existing customers loyal because they believe that it is their existing customers who attract new customers. Allied Bank uses KYC (Know your customer) forms to have complete acquaintance with their new customers. TARGET MARKET Allied Banks main focus is not on the retail banking but on the corporate banking rather. In the retail banking they target salaried individuals, housewives, retired individuals and anyone who has the potential of providing legal deposits to the bank. Corporate customers being the main target of the bank get handsome packages of loan and other financial services. The banks main source of revenue earning is also the corporate sector customers. VARIETY in PRODUCTS Allied bank has skillfully crafted their products to use them as their core competencies and also as their tools for competitive strategy. The products include Agricultural Finance, Import Export Business/Trade Finance, Running Finance, and Demand Finance. These products serve multiple purposes to bank.

SERVICES as COMPETITIVE TOOLS Same is the case with the services offered by Allied Bank. Services are the main tool through which the bank acquires new customers and retain them. These services are not merely ment to earn profit, but also to keep pace with the changing needs of the customers and modern days banking trends. These services include Home Remittances, Remittances, Hajj Services, Utility Bills, Lockers and Commodity

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Internship Report 2010 Operations. Along with these core services provided by the bank, online banking and Internet banking serve as supplementary services. These products and services are mainly directed towards customer satisfaction and ABL uses it for the customer satisfaction as their competitive strategy. Some of the many benefits availed by the customers are mentioned as follow in banks own style. ONLINE FACILITY Now the bank gives you the absolute convenience of instant access to a host of banking facilities and personalized services 24 hours a day, 7 days a week, 365 days a year. Simplify the way you bank and experience a higher level of convenience ONLINE FEATURES By Allied bank Online you can; 1 Check your account balances 2 Transfer funds between your own accounts and to a third party account 3 You can use your card for loan account payments 4 Check transaction history of your accounts 5 Get your account statement through fax 6 Receive information on various Allied bank products and services 7 Find out status of your card or loan application 8 Request balance or reference certificate 9 Get currency exchange rates 10 Issue stop payment instructions 11 Report loss of your cheque book 12 Request change in address and telephone numbers. CONVENIENCE Why visit the bank when you can better use your precious time to meet other commitments? With ONLINE, our special discounted charges also offer you substantial savings.

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Internship Report 2010 Give yourself the advantage of breakthrough innovation and cutting edge and get time on your side TOLL FREE NUMBER Connect to Allied bank ONLINE by dialing from anywhere within Pakistan. Your call costs you nothing because it is toll free. This just goes to show that we at Allied bank always put your interests first. Dial now to discover just how Allied bank can make youre banking experience even more enjoyable and rewarding. By offering all of the above ABL makes its way through the tough competition of the day. This helps the bank to keep pace with growing needs of its customers and anticipate their future needs and manage them accordingly in time thus to make sure that the quality is not compromised and the customers get what they want .

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Internship Report 2010 SWOT ANALYSIS

Strengths The Allied Bank Limited has a large network of branches. There are more than 700 branches in Pakistan and all branches having online banking system. The Allied Bank Limited has computerized banking system. To train its employees Allied Bank Limited has training centre. There are different training sessions held for new and old employees. The Allied Bank Limited provides the online banking facility to its customers. Strong financial backing The keeping of a good and modest environment during business hours A good system of communication flow is there. The bank has a good team of customer relation managers and customer relation officers to help the people. Highly experienced staff right from the banks incorporation. Internal services easements and timely review of employees performance. Providing the secure, safe and reliable services to the customers. Weakness Some of the threats that needs to be noticed, that are

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There is need to enhance the3 product line. Turn over rate of employees is increasing, as they are not satisfied with the pay structure. Complex decision making. Non merit based hiring. Poor maintenance of internal equipments. Offline problems in branch network. There is lack of proper advertising like sponsoring of any festival or any event. Staff is not available according to needs.

Opportunities The Management team comprises of highly qualified professionals sharing a strong commitment to the bank. The bank brings together sponsors including highly respected multinational financial institutions and multilateral Banking institutions. Each and every transaction of the Bank is monitored by its highly specialized personnels. The external factor that is helpful to achieving the objective of the organization. In simple words, opportunities means, the favorable chances in the external environment due to which organization achieve growth & enhancement. The No. of salaried persons is increasing with the economy structure of the country. This creates opportunity in consumer financing. As economy is growing, there is more investment demand in Pakistan. Banks have opportunity to enhance their business. Imports and exports of the country are increasing. With the threat of WTO SME, require more funds to enhance their infrastructure to improve the quality. Banks are the source of these funding. Stronger and deeper relationships with existing and potential customers. Attractive rates of return. Page 29

Internship Report 2010 The role of personal bankers and relationship managers may increase its market share. Highly motivated and committed staff towards the bank and towards the management policies. More innovative products and services. New industrial markets. International operations. Introduction of new quality services.

Threats Some of the threats that needs to be noticed, that are: The State Bank of Pakistan often imposes various restrictions on banks. Therefore none of bank is independent in policy making and can launch any new product without the permission of the SBP. Influence of Political factors. Foreign banks may increase marketing support and aggressive sales drive. Introduction of the same kind of products by private banks with online platform. The employee turnover can create a serious problem for the bank. Regulations relevant to Islamic banking. Higher limit for account opening and profit earning.

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Financial Analysis
The Objectives of Financial Statement Analysis The overall objective of financial statement analysis is the examination of a firms financial position and returns in relation to risk. This must be done with a view to forecasting the firms future prospective. For the purpose of understanding, the following financial statements will be used. BALANCE SHEET AS AT 31ST DECEMBER (Rupees in 000)

2008

2009

ASSETS: Cash and Balances with treasury Banks Balances with other banks Lendings to financial institutions Investments-gross Advances Other assets Operating fixed assets Deferred Tax assets Total Assets LIABILITIES: Bills payable
2,952,490 3,162,429 23,653,754 2,097,611 15,793,183 82,449,475 213,020,108 17,388,612 11,150,129 1,031,049 366,583,921 26,435,683 1,280,591 28,122,932 94,673,100 237,382,522 17,986,438 12,459,586 --------------418,340,852

Borrowings from financial institutions

27,778,151

39,818,532

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Deposits and Other accounts Subordinated Loans Liabilities against assets subject to finance lease Other liabilities Deferred Tax liabilities Total Liabilities Net Assets Represented By: Share Capital Reserves Unappropriated Profit Surplus on revaluation of assets - net of tax
6,463,644 5,804,776 8,475,791 7,110,008 6,582,845 12,164,662 297,474,543 2,498,000 -------13,644,838 -------344,348,022 22,235,899 328,872,559 5,497,000 -------11,067,164 3374 388,421,058 29,919,794

20,744,211 1,491,688

25,857,515 4,062,279 29,919,794

Total Equity

22,235,899

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Internship Report 2010 PROFIT AND LOSS ACCOUNT For 31 December (Rupees in 000)
2008 30,594,020 17,262,519 13,331,501 1,372,155 1,840,249 2,736 ------3,215,140 10,116,361 2,314,930 1,426,378 958,964 150,537 3,201 59,934 ,913,944 15,030,305 2009 41,144,667 22,421,218 18,723,449 3,162,963 1,067,608 ---280,595 -----4,511,166 14,212,283 2,800,306 1,378,919 761,934 1,101,477 (365) 35,986 6,078,257 20,290,540

Markup/ return/interest earned Markup/return/ interest expensed Net markup/interest income Provision against non-performing loans and advances-net Provision for diminution in the value of investments Bad debts written off directly Provision against lending to financial istitution Net markup/interest income after provisions NON MARK-UP/INTEREST INCOME Fee, commission and brokerage income Dividend income Income from dealing in foreign currencies Gain on sale of securities Unrealized loss on revaluation of investments Other income Total non mark-up/interest income classified as held for trading - net Non mark-up/ interest expenses Administrative expenses (Reversal) / Provision against other assets - net (Reversal) / Provision against off-balance sheet Worker welfare fund Other charges Total non- markup/ interest expenses PROFIT BEFORE TAXATION Taxation Current Prior years deferred Profit after taxation Unappropriated profit brought forward Transfer from surplus on revaluation of fixed assets - net of tax Profit available for appropriation Earnings per share - Basic and Diluted (in Rupees)

9,517,584 214,284 190,824 125,060 265,817 8,973,383 6,056,922 1,830,073 -----132,988 1,963,061 4,093,861 6,973,327 17,541 11,084,729 5.76

8,177,398 (56,431) (25,353) 215,741 67,377 9,718,918 10,571,622 3,551,493 ----(129,181) 3,422,312 7,149,310 8,475,791 32,360 15,657,461 10.06

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Business process

New cases received

MIS entry

Checking or verification

Office note

Signature by head

Dispatch entry

Dispatched

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DUTIES & ACCOMPLISHMENTS During my internship in ABL I worked in Remittances, Advances, Foreign Exchange and Account opening department and I successfully completed all the task/duties that were assigned to me. The duties that I performed and the thing I learned are given as follows: Learned basic operations of remittance department Learned how to make entries and vouchers for PO and DD Observed other operations e.g. PO (Pay Order), DD (Demand Draft) Learned bank charges for PO, DD Learned how to make entries and vouchers Made Debit vouchers against the PO & DD charges Made Credit vouchers (contra) against the PO & DD charges Learned basics of clearing process. Studied few chapters of Foreign Exchange Manual Worked on the seat of A/C Opening/Check Collection/Lockers I learned and performed the following activities: o Opened three accounts o Issued check books o Received Check Book Issuance Requisition Opened new accounts Issued check books Made Vouchers Page 35

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Sorted Foreign Currency Signature Verification Cards Complince Report Sorting Dposit slips. How Experience Affects On My Career In my opinion, experience put a very strong impact upon my career. Before doing internship, I had no knowledge regarding the practical work. Until my internship, I had only experienced theoretical things and not gone through a major practical experience. However, while working in Allied Bank Limited I have gained self-confidence and a thorough and sound approach regarding coordinating work activities, improving work relations with colleagues and a firm grip of the various stages of business processes in an organization. I have this firm belief now that whenever I will search for an employment, I would be very much able to select the options that are best suited to me according to my personality, attitude and area of specialization, after working with Allied Bank Limited. I would definitely not feel like a fish out of water while working as a professional in any organization; be it a bank, a company, NGO etc. Besides if, one has an internship experience with a competitive and a strong and stable organization; it creates a good impact on your Curriculum Vitae too. Internship has taught me the value of time. During the period I spent at ABL Ive come to realize that sometimes only a matter of seconds could bring a steady and drastic decline in the profit and goodwill of an organization. Therefore, I would say I have become more time conscious now; that in itself is a very positive change. I have also learned an ample degree of organizational politics and its effects on the working environment, work relations and work activities of the employees. The only way to survive in an organization is to exhibit a positive and learning attitude as it helps a lot in achieving the maximum and the best for yourself and the organization.

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PROBLEMS IN ABL Following are the identified problems that I have observed in ABL. System Breakdowns The internal computer system is quite slow and often gets hanged up. The Bank software Symbols has been newly introduced and is incurring some problems. Most of the time system gets offline from the head office and customers have to wait in queues. Another technological problem is related to ATM machines. Most of the time customers come into the branch and complaint about ATM machines. Employee Related Issues Employees at ABL are less motivated. One reason behind this behavior is the workload that is enforced on the employees. Another reason is that referrals are given preference at ABL and referrals are given frequent job rotation, job enrichment and promotions. This kind of unjust has decreased the morale of other employees. According to the observation, employees are not well trained and have low technological how know. Employees are not given proper training and development to perform their jobs efficiently. Refresher Courses for the staff are most important in any international organization. Alt the employees should have these courses according to their requirement. Foreign experts can also be called for this purpose. Low Promotional Activities ABL advertises rarely and its promotional activities are relatively low from the other competing banks. ABL has few billboards around the city and few electronic ads. Working environment, equipment, furniture and staff dressing should be according to the modern banking style.

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Internship Report 2010 RECOMMENDATIONS From the financial data it can be easily judged that Allied Bank is performing well. Its deposits are growing day-by-day and so its profitability. The controlling body is responsible for the productive performance of the Bank. As an Internee my recommendations according to the problems are: Proper Distribution of Workload Workload should be divided into employees like no one feels the workload. All the employees must have an equal workload so everyone will feel comfortable and will be motivated. Provide Friendly and Stress Free Environment A friendly, stress free and flexible environment should be provided to employees to make them work in relaxed environment. In this sense employees will be happy and will deal customers with utmost care and empathy. Reduce Technological Breakdowns They should focus on proper maintenance so that technological breakdowns and other related problems would be reduced. Rewards and Promotions Every employee should be given rewards according to his performance and bank should take some action regarding referrals who does not perform their jobs as they should be. In this way, referrals will also start working and employees will feel an environment that is full of justice. Advertisement and Promotion Bank needs to advertise aggressively to express its hidden strengths to the customers. ABL can get more competitive position in market through advertising because there is direct relationship between sales and advertising.

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Team Work ABL should form teams of employees and should operationally management by objective technique. In team, employees will be able to achieve complex tasks efficiently in less time. Some other recommendations are: A big portion of the home remittance is sent by Pakistan working capital through Allied Express. As we know a big portion of this amount is wasted purchasing of luxuries. The people motivated to save money by offering the deposit through various investment schemes. The rate of profit should increase 1% or 2% than other banks and it would be profitable step for bank. Allied Bank Limited provides loan to the customers for agriculture sector in the Agri finance for different field as poultry farming, dairy farming and for crops. They make loans by pledging land and other reserves. But a person who has not land of their requirement cant take loans, so they should design such policies so that the small farmer can take loans. There is a criticism on the banking management that the salaries of the employees are decreasing in every succeeding year. And I think this will shake the confidence and working habit of the employees. The Alied Bank Limited should design policies to attract the industrial sector and there should be front desk for the industrial sector. Most of the bank employees, are sticking to one seat only with the result that they become master of one particular job and loose their grip on other banking operation. In my opinion all the employees should have regular job experience all out-look towards banking. The promotion policy should be adjusted. Especially the policies for Agriculture sector should be favorable for the middle level farmer.

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Internship Report 2010 The Allied Bank Limited various products, but it is not following a reasonable strategy for promotion of product for its product. They should adopt proper marketing planning and strategies for promotion as other banks follow Every year some of the employees should be sent for training to other countries and employees from other branches should be brought here. Some more reading material should be provided. The purpose should be to educate the employees with the advance studies in their field. The employee should be provided the opportunities to attend and participate in seminars and lectures on banking. I observed that many efficient employees are leaving from the Bank because of job dissatisfaction. Bank should provide them job satisfaction and also give incentives that they will remain in the Bank Bank should give some more incentive to its employees in order to remove the conflict between lower and higher officers and should try to improve the working condition of the bank. As such system should be designed that every employee who has some problems with his officers can communicate it to the higher management and some steps must be taken to improve that. Recruitments should be strictly on merit basis and induction should be after proper and extensive training. Young, qualified and energetic staff should replace old and lazy staff. Foreign branches should be opened in order to capture the international market and to earn international repute for the bank. Bank should adopt the global organizational banking structure to meet the international standards of banking sector.The employee should to provide proper benefit to the workers.

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Internship Report 2010 BIBLOGRAPHY

Website of State Bank of Pakistan. http://www.sbp.gov.pk Website of Allied Bank Limited. http://www.abl.com

BUSINESS JARGONS DD (Demand Draft) DDP (Demand Draft Purchase) TT

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