Course Booklet - Branch Services Officers

Branch Services Officers
Branch Management Development Program

Course Booklet 1
UBL’s Branch Management Development Program (BMDP)
UBL Learning and Talent Management Division have launched the competency-based Branch Management Development
Program (BMDP). BMDP is a very well structured, comprehensive and state of the art certification solution across the UBL
branch network. Subject matter experts (internal and external) in collaboration with the Learning and Talent
Management Division have worked on the development of contents, slide decks, and manuals. Certification will be co-
branded by UBL and IBP.
The Institute of Bankers Pakistan (IBP) is the premier training institute of the banking industry in Pakistan. Established in
1951 with the intent of providing a skilled workforce to the banking and finance industry to cater for its ever-evolving
needs, the Institute has since been actively engaged in setting standards, training and certifications to enhance the
quality of human resources available to banks in Pakistan.
This certification program will cover the following UBL branch network position.
Branch Banking District Manager (DM) Branch Manager (BM) Relationship Manager (RM) Greeter
Operations District Operations Branch Operations Customer Services Representative Branch Services Branch Services
Manager (DCSM) Manager (CSOM) (Operations Officer) Supervisor (CT) Officer (UT)
These certifications are linked with individual career progression and will formulate the basis for promotions and
movement into more responsible roles.
All certifications are assessment based. BMDP specific information can be acquired through IBP help desk at 111-427-477
during the office hours.
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Contents
1. Customer Service Essentials
2. Interpersonal Skills
3. Personal Grooming
4. Account Opening and Operations
5. Cash Handling/ Clean Note Policy
6. Compliance/ Internal Control
7. UBL Specific – Products
8. UBL Specific – Values
9. Service Quality – Branch Role in Handling
Customer Grievances
10. Service Quality – Mystery Shopping
Program Topline Results
11. Code of Conduct/ COE
12. KYC/ CDD and AML/CFT
13. FOREX
14. FATCA
15. CRS
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1. Customer Service Essentials
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Objectives
After participating in the course, learners will be able to:
1. explain the reasons for caring for customers;

2. define who the customers of an organization are;
3. apply some techniques to serve customers better.
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Importance of Customers
C – cost of the paycheque we receive

U – ultimate bloodline of the business
S – sensitive treatment he/she needs
T – treated courteously and promptly
O – origin of the existence of our work
M – member of commodity of prospective customers
E – expects his needs to be satisfied
R – remember his experience in our branches
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Know who are your Customers?
Customers are people who need your assistance. They are not an
interruption to your job, they are the reason you have a job.
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Internal Customers
Internal customers are those who work within the organization

and use one another’s departments’ products or services as
part of the supply chain, to serve external customers.
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External Customers
External customers of an organization are the ones outside the

organization, whom the organization serves.
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Good Customer Service
Good customer service is taking that extra step to help without

being asked! It’s all about attitude and skills.
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Advantages of Good Customer Service
1) It retains the customer

Naturally, when the customer is happy with your service, he will stick back with
your brand and will not shift to competitors. This in itself is a big plus point for the
company as customer retention is far cheaper then customer acquisition.
2) Gets you more references
When you give good customer service, your customers talk about you to others. They
tend to do so even more when they have been receiving good quality service over a
period of time. These references mean money to your business. The more the
references, the more customers acquired without spending a dime.
3) Creates word of mouth
I once traveled to Singapore through a travel operator. I was so impressed with that guy,
that till date i would have given him references of at least 10 tours. These 10 customers
will surely refer him to their friends, and so the word of mouth has traveled a long way
from a single customer. The word of mouth may travel to many people, but everyone will
not be a customer.
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4) Increases profitability
When your service is good, and the word of mouth and references are good, you will
acquire new customers at a fraction of the cost you were supposed to. A normal business
spends a lot in advertising, promotions and whatnot to get customers to walk in to their
doors. But with good customer service, all that is being done by your existing customers.
This ensures fantastic profitability as you are getting maximum returns on the investment
already done.
5) Gives you and your employees confidence

When a customer praises your business, it also boosts your employee morale. Naturally,
over a period of time, your confidence rises on your business and you now know that
giving good customer service is the key to build confidence in your employees, who will
be empowered enough to keep their customers happy. Ultimately, your own internal
customers are also happy.
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6) More Effective Workforce

With your employees motivated, with your insight into the customer mindset and what
makes the customer happy, and with the positive and happy customers, the overall
business becomes a holistic marketing scenario; wherein everyone is doing their part for
ultimate customer satisfaction. This is the best thing you want to achieve as an
organization, because even the smallest employee understands the role he plays in
customer satisfaction.

7)Competitive advantage
your customer service and the manpower that you employ for service can become
your competitive advantage. If your employees themselves are building relationships
with customers, then they will not allow a competitor to enter or place toehold. Hence,
your business becomes sustainable and competitive and difficult to beat.
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Qualities Required for Good Customer Service
• Know about your organization

• Know about the product or service
• Learn the technical parts of the job
• Communicate well
• Be consistent
• Be organized
• Manage time
• Be patient
• Be assertive
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Do’s of Customer Service
• Smile and greet a customer

• Welcome the customer by name, if possible
• Maintain eye contact
• Listen carefully to what the customer says
• Show courtesy and respect
• Be enthusiastic
• Be careful of your speech and tonality
• Offer alternatives
• Ask questions
• If you can’t help, find someone who can
• Never argue
• Always make sure the customer leaves the bank satisfied and informed
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Don’ts of Customer Service
• Ignore them
• Lie to them
• Fail to deliver on promise
• Be rude to them
• Poor follow-up
• Incompetent staff – lack of product knowledge or process
• Treating them as if they are wrong
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Communication is a 2-way Process
Communication skills involve: sender
• Listening to others (Receiving) message

• Asserting/ Expressing (Sending) receiver
sender
Barriers
receiver
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Communicating with Customers
Greeting Customers
The purpose is to create and maintain a welcoming environment - how can this be
achieved?
• Be attentive, acknowledge a person as soon as they appear, even if you’re busy
• SMILE!
• Establish eye contact
• Tell them your name
• Ask how you can help
• Give the customer your full attention
• Be polite and courteous……………
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Establishing Rapport
What does good rapport feel like?

Practice greeting someone
• Make the customer feel comfortable

• Make the customer feel important and valued
• Use empathy
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Find out how You can Help
• How can you find out what people want?

• If you can’t help, what should you do?
• Offer alternatives if possible
• If they have to wait, how would you handle it?
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Telephone Skills
• Know how to use the phones

• Speak clearly and slowly
• Smile (you can hear it in your voice!)
• State your name and bank
• Write down the caller’s name and use it
• Don’t say rude things while someone’s on hold
• If they’re explaining something use words to show you’re listening (umm, yes …)
• Have pad and pencil ready to take notes or messages (check spelling and message
content)
• Don’t eat or drink while on the phone
• Do not put customers on long holds un-necessarily
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Written Communication
• Respond business email quickly

• Write clearly and concisely
• Refer to the customer’s letter, date and query
• Be friendly without being too informal
• Check your spelling and grammar
• Make sure you’ve answered their query or request or explained why you can’t
• Be timely or apologize for any delay in replying
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Making a Good First Impression
First impressions count and will affect the interaction. People make
judgements in the first 30 seconds.
Golden Rule – You only have one chance to make a first impression!
• Be confident
• know your organization and the services you provide
• Maintain Confidentiality
• Follow up (don’t just say you’ll do something… do it)
• Strengthen the customer’s commitment to your organization
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Communicating with Un-satisfied Customers
• Label the behavior, not the customer

• Listen carefully without interrupting so you understand the problem
• Empathize in a broad way
• Stay calm and remain polite
• Don’t get defensive
• Don’t take it personal
• Discuss alternatives
• Take responsibility for what you CAN do
• Don’t escalate the problem
• Propose an action plan and follow it
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The Role of Managers
• Hiring and training employees

• Setting policies and procedures
• Calm the frustrated customers
• Check the branch
• Team Building
• Delivery Metrics
• Strategies, Planning and Documentation
• Innovation and Customer Engagement
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Hiring and Training Employees
It is the responsibility of the customer service manager to hire a team of dedicated and committed employees who
have the desire to take care of customers' issues. Because many customer service jobs are entry-level, it is the
manager's job to ensure new employees receive thorough training as to how to deal with frustrated customers and
resolve their problems.
Setting policies and procedures
A customer service manager may also be called on to help with other relevant activities. This may include controlling
expenses and increasing revenue. He or she may also be asked to help set up policies and procedures, especially
concerning customer service plans. By establishing policies and procedures that handle those issues, the company can
demonstrate its commitment to providing excellent service to customers.
Calm the frustrated customers

When an employee is helping a customer and the customer is not satisfied, he or she may request a manager. There are
other times that an employee is not able to help or calm a customer, and the employee may ask the manager to step in
and help with the customer's problem. In either situation, a customer service manager must be able to listen to the
customer, calm the customer down, and create a reasonable solution that will create a satisfied customer
Check the branch

A manager should take a round and check the surroundings of the branch and ensure the environment of the branch is
comfortable and welcoming. There is proper seating and water arrangements for the visitors.
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Team Building
The duties of a Customer Service Manager primarily lie in creating a team of individuals committed to the task of
great customer service. This will include providing the necessary training to each individual in the team,
understanding their strengths and weaknesses and continuously striving to eliminate barriers that bring down the
quality of customer service.
Delivery Metrics
It is also very vital that a manager is able to reduce the cost invested into the support process. For this cause, one
has to actively monitor the help desk metrics on a weekly basis to track the areas that are slow or weak, discuss with
the concerned employees to outline the reason for the same and do the needful to rectify the issues at the earliest.
Strategies, Planning and Documentation

The responsibilities of a Customer Service Manager entails building strategies and planning for all kinds of request
types and volumes and train the team to be always prepared for emergencies. There should be a comprehensive
record of all the tickets, discussions with customers, critical issues and reports such that they will always help with
future issues.
Innovation and Customer Engagement

Customer Service Manager’s focus should be on driving innovation, enhancing the support both in terms of voice
calls and emails and make it an enriching experience for both the employees as well as the customers.
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Conclusion
Customer care has to have its roots in a

company’s culture and corporate beliefs. It
cannot be added on to a business as an
afterthought.
Andrew Brown (1989) Customer Care Management
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2. Interpersonal Skills
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Introduction
Interpersonal skills are the skills we use every day when we communicate and interact
with other people, both individually and in groups. People with strong interpersonal
skills are often more successful in both their professional and personal lives.
Interpersonal skills include a wide variety of skills, though many are centered around
communication, such as listening, questioning and understanding body language. They
also include the skills and attributes associated with emotional intelligence, or being
able to understand and manage your own and others’ emotions.
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Knowing Yourself
"To know thyself is the beginning of wisdom.“
Why you might want to know your own nature?
Happiness: You will be happier when you can express who you are. Expressing your desires,
moreover, will make it more likely that you get what you want.
Less inner conflict: When your outside actions are in accordance with your inside feelings and
values, you will experience less inner conflict.
Better decision making: When you know yourself, you are able to make better choices about
everything, from small decisions like which sweater you’ll buy to big decisions like which partner
you’ll spend your life with. You'll have guidelines you can apply to solve life’s varied problems.
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Interpersonal Skills
• Self control: When you know yourself, you understand what motivates you to resist bad habits
and develop good ones. You'll have the insight to know which values and goals activate your
willpower.
• Resistance to social pressure: When you are grounded in your values and preferences, you are
less likely to say “yes” when you want to say “no.”
• Tolerance and understanding of others: Your awareness of your own foibles and struggles can
help you empathize with others.
• Vitality and pleasure: Being who you truly are helps you feel more alive and makes your
experience of life richer, larger, and more exciting.
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Create a Culture of Trust and Respect
Recognize excellence.
Do you recognize a job well done immediately after it happens? Neuroscience proves that public recognition has the
largest effect on trust when it occurs immediately after an employee meets a goal. Public recognition inspires others
to try harder as well.
Induce "challenge stress."

Moderate stress caused by difficult but attainable goals releases oxytocin and adrenocorticotropic. This chemical
change results in greater focus and deeper collaboration. Challenges must be follow the SMART model: Specific,
Measurable, Attainable, Realistic, and Time-Sensitive with a deadline.
Empower employees to choose their work patterns and habits.

Autonomy over work conditions communicates to employees that their leadership trusts them.
Give employees a voice in their own job design.

Employees welcome the opportunity to have input into the projects they work on, who they work with, and how they
work. This freedom allows them to select projects that most closely align with their strongest skillsets and
professional passions.
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Create a Culture of Trust and Respect
Communicate often.
Thorough and frequent communication is one of the easiest ways to gain employee loyalty and trust.
Intentionally build relationships.

A study has found that having a best friend at work significantly increases workplace engagement. The study revealed
that those that felt they had friends at work were 43% more likely to report having received recognition for their work.
Facilitate whole-person growth.

Employers who recognize that employees are multi-dimensional and are interested in comprehensive personal and
professional development beyond technical development will have a competitive advantage over those that don't.
Show vulnerability.
The organizations with the highest trust recognize that asking for help is a two-way street. The most emotionally
connected leaders let their employees know that they need their help to build the best organizations possible.
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The Art of Saying No
What’s so hard about saying no? Well, to start with, it can hurt, anger or disappoint
the person you’re saying “no” to, and that’s not usually a fun task.
Second, if you hope to work with that person in the future, you’ll want to continue
to have a good relationship with that person, and saying “no” in the wrong way can
jeopardize that.
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• Value your time. Know your commitments, and how valuable your precious time is. Then, when someone
asks you to dedicate some of your time to a new commitment, you’ll know that you simply cannot do it.
And tell them that: “I just can’t right now … my plate is overloaded as it is.”
• Know your priorities. Even if you do have some extra time (which for many of us is rare), is this new
commitment really the way you want to spend that time?
• Practice saying no. Practice makes perfect. Saying “no” as often as you can is a great way to get better at it
and more comfortable with saying the word. And sometimes, repeating the word is the only way to get a
message through to extremely persistent people. When they keep insisting, just keep saying no.
Eventually, they’ll get the message.
• Don’t apologize. A common way to start out is “I’m sorry but …” as people think that it sounds more
polite. While politeness is important, apologizing just makes it sound weaker. You need to be firm, and
unapologetic about guarding your time.
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• Stop being nice. Again, it’s important to be polite, but being nice by saying yes all the time only hurts you. When
you make it easy for people to grab your time (or money), they will continue to do it. Show them that your time is
well guarded by being firm and turning down as many requests (that are not on your top priority list) as possible.
• Say no to your boss. Sometimes we feel that we have to say yes to our boss — they’re our boss, right? And if we
say “no” then we look like we can’t handle the work — at least, that’s the common reasoning. But in fact, it’s the
opposite — explain to your boss that by taking on too many commitments, you are weakening your productivity
and jeopardizing your existing commitments. If your boss insists that you take on the project, go over your project
or task list and ask him/her to re-prioritize, explaining that there’s only so much you can take on at one time.
• Maybe later. If this is an option that you’d like to keep open, instead of just shutting the door on the person, it’s
often better to just say, “This sounds like an interesting opportunity, but I just don’t have the time at the moment.
Perhaps you could check back with me in [give a time frame].” Next time, when they check back with you, you
might have some free time on your hands.
• It’s not you, it’s me. Often the person or project is a good one, but it’s just not right for you, at least not at this
time. Simply say so — you can compliment the idea, the project, the person, the organization … but say that it’s
not the right fit, or it’s not what you’re looking for at this time.
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Creating Empathy
Empathy represents the ability to understand someone else’s thoughts and

feelings. In other words: compassion. Listening to your coworkers and taking their
concerns into consideration.
Being empathetic in the workplace provides meaningful, concrete returns.

Connecting coworkers helps sustain thriving company that’s built for the long
term.
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Creating Empathy
1. Rethink How You Listen

When your coworkers come to you with questions and concerns, how well are you listening?
Here’s some food for thought: most employees don’t actually listen to what their colleagues have to say.
Actively listening to your coworkers requires effort, plain and simple. As a support-based employee, each
email or face-to-face conversation with your colleagues deserves your full attention. Understand that
your time spent in the workplace is just as valuable as theirs is and better listening means solving their
problems in a timely manner.
2. Master the Art of Asking Questions

Exercising empathy for coworkers means not only being a good listener but also asking the right
questions to get to the root of your colleagues’ problems.
When you ask thoughtful questions of your coworkers, you’re basically saying, “Okay, I hear you. What
can I do to help? How are we going to take care of this?”
Questions asked of your employees should be specific rather a blanket, one-size-fits-all response.
Workers deserve to have their concerns heard and understood.
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Creating Empathy
3. Walk in Your Coworkers’ Shoes

This means approaching your coworkers’ concerns with an open mind. Don’t forget the roles and responsibilities
in your office that are worlds away from your own. Unless you’ve shadowed your coworkers or have worked in
their position, you may have little to no grasp on what their day-to-day duties look like in action. The average
week for someone in the marketing or accounting department may very well look like night and day versus IT or
HR.
4. Avoid Making Assumptions

On a related note, give your coworkers the benefit of the doubt before passing judgment on their behavior in
the office.
Let’s say a new hire is having trouble adhering to a particular policy. You could assume that they’re being
negligent or otherwise aloof, but chances are they’re simply adjusting to a new way of thinking. Both adopting
and breaking away from workplace rituals takes time and you should respect that.
Workplace stress comes in all shapes and sizes. Practicing patience with your coworkers is key to demonstrating
empathy in the workplace.
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Creating Empathy
5. Learn How to Prioritize Problems

When it comes to giving your coworkers a hand, not all problems are created equal.
Again, empathy requires you truly listen to your employees and their concerns. Taking a blanket “first come, first
served” approach to problem-solving isn’t exactly compassionate or personal.
6. Don’t Keep Your Coworkers at Arm’s Length

Supporting your coworkers means more than responding to emails and service requests. Positive workplace
relationships make empathy much easier as you get to know your coworkers as people rather than email addresses
or departments.
Although you don’t need to be best friends with everyone in the office, taking some interest in your coworkers
beyond a professional capacity is a major plus.
Chat it up in the breakroom from time to time. Take those team-building exercises seriously. Employees are much
more likely to work smoothly with a friendly face versus someone that’s cold.
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Creating Empathy
7. Remember That People Have Feelings

When we’re laser-focused on profits or productivity, it’s easy to lose sight of how your coworkers feel.
Seriously, though: don’t forget that your coworkers are people, too. Criticism and condescending comments
shouldn’t be your go-to reaction when working with even the most difficult coworkers. Despite our frustrations and
faults, we’re all in this together.
8. Accept That Empathy Doesn’t Happen Overnight

Learning how to develop empathy skills such as patience, keen listening, and asking thoughtful questions takes
time. The more you interact and become comfortable with your team, the easier it becomes to show them
compassion.
Don’t let one bad experience or toxic coworker wreck your otherwise positive outlook, either. Consistently showing
up and responding to coworkers’ concerns will ultimately lead to empathy, influence and respect. Once you’ve
kindled positive relationships with your coworkers, everyone else in the office will be more likely to return the
favor.
The end result? A connected, compassionate workplace.
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Influential Negotiation
A good set of influence skills belongs in the toolkit of every negotiator. Having them will provide you with a conscious method for
shaping agreements to meet all parties needs.
1) Choose Good Questions To Ask
Good negotiators seem to ask a lot of questions and are very concerned about understanding exactly what it is you are trying to
achieve from the negotiation. Finding good questions to ask about a customer’s needs is the only way you will be able to find out in a
negotiation what exactly is important to them and what benefits they are truly looking for.
2) Patience
Good negotiators are very patient. They concentrate first on getting agreement on all the parts of the contract that the two parties
have in common before they go on seeking for amicable ways to settle the other issues. They also take the time to prepare good
questions to ask to get clarity and understanding on each point as they go along, so that there is no confusion later.
3) Preparation Is Key
Preparation accounts for 90% of negotiating success. The more and better prepared you are prior to a negotiation, the more likely it is
that the outcome of the negotiation will be satisfactory for all parties involved. Preparation requires you do two things. First get all
the information that you can about the upcoming negotiation. Second, think the negotiation through carefully, from beginning to end,
and be fully prepared for any eventuality.
The first kind of information you need is about the product or service, and the person with whom you will be negotiating. You obtain
this information by choosing good questions to ask that are well thought out. In this sense, information becomes a form of power, and
the power is always on the side of the person with the best information.
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The Power of Positive Language
Positive language will enable you to control or frame your communication. Using positive, declarative language and
power words will overcome negative and ‘toxic’ language.
Some examples of positive declarations that have been converted out of negative words are:
• Negative response: “No, the project won’t run at a loss.”

Positive response: “The project is still scheduled to run on time and on budget.”
• Negative response: “It won’t have a detrimental impact on the environment…”

Positive response: “The environmental impact will be minimal [zero?].”
• Negative response: “That’s wrong. We didn’t pay less than the amount claimed.”
Positive response: “If you check the facts, you’ll find we paid the full amount.”
• Negative response: “We didn’t do that”

Positive response: “Here’s what we actually did.”
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Positive Words to Use
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Tips to be Positive
Practice these simple exercises and suggestions to keep your thoughts on the positive side.
• Only use positive words when talking: If you’re constantly telling yourself “I can’t” you may convince
yourself that’s the truth. Replace these negative words with positive ones instead. Tell yourself you will do
your best or that you will try your hardest instead.
• Push out all feelings that aren’t positive: Don’t let negative thoughts and feelings overwhelm you when
you’re feeling down. Even if it’s only for a few hours a day, push your negativity aside and only focus on the
good things in your life.
• Use words that evoke strength and success: Try filling your thoughts with words that make you feel strong,
happy and in control of your life. Make a concentrated effort to focus on these words rather than those
that make you feel like you are failing or incompetent.
• Practice positive affirmation: One of the most popular positive thinking exercises is positive affirmation.
This means you repeat a positive phrase to yourself on a regular basis like “I deserve to be happy” or “I am
worthy of love”. Believing that these things are true, and reminding yourself of it can help give you a more
positive outlook on life.
• Believe you will succeed: There is nothing like believing in yourself to create a successful reality. Give
yourself the benefit of the doubt and believe that you will succeed at fulfilling your goals.
• Analyze what went wrong: Thinking positively doesn’t mean denying that there is anything wrong. Instead,
give yourself some time to think about the things that led up to your current situation so you can avoid
future mistakes and look toward a more positive tomorrow. 46
Tips to be Positive
• Give yourself credit. Often when we feel frustrated or upset we only concentrate on the bad things or
the mistakes we’ve made instead of giving ourselves credit for what we do right. Allow yourself to feel
confident about the things you have accomplished, even if you’ve messed up in other areas.
• Learn from the past. The past is behind you and no matter how badly things went there is nothing
you can do to change them. Whenever you feel negative thoughts about the past come up, replace
them with positive thoughts about the future.
• Think of it as an opportunity. Sometimes even the seemingly negative things in our lives present us
with opportunities we wouldn’t have been strong enough to pursue otherwise.
• Come up with ideas of how to turn negative thoughts into positive ones. If you find yourself
thinking you should have done this or that differently, try changing your thoughts around. Instead give
yourself credit for what you did do, remember that you are not perfect or that you can do better next
time.
• List the reasons you will get what you want. If you are having trouble believing that you’ll get that big
promotion or that your book will get published try sitting down and coming up with a list of reasons
that you will get what you want rather than focusing on the reasons you might not.
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Being Positive at Work
• Be constructive. Giving yourself cruel and unwarranted criticisms will not only put you in a bad mood it surely won’t
help you improve either. Be constructive in your criticisms of yourself so you can grow and learn.
• Visualize a successful outcome. Sometimes it can be helpful to picture yourself completing a project successfully or
getting the promotion you desire. This can encourage you and make you feel better about the situation.
• Sit up straight. Slouching down in your chair isn’t going to make you feel any better about anything that’s bothering
you. Sit up straight in your chair and see if it improves your thinking.
• Surround yourself with positive images. Make your desk your own private happy getaway. Put up pictures of things
that make you happy or that remind you of your goals to create a calming and positive environment.
• Relax and let things happen. Sometimes the best way to deal with problems is to relax and let them take their
course. Things can often appear to be a bigger deal than they really are and reminding yourself of this can help you
to relax and not feel so stresses.
• See it from another point of view. Change your pattern of thought by trying to see things from another point of
view, whether it’s your coworkers, your bosses or just someone impartial. It can help you see where you went wrong
and understand why others might be upset.
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Being Positive at Work
• Keep track of your thoughts. When you catch yourself thinking negative thoughts, try jotting them down.
You may find a pattern and figure out some ways to reverse how you’re seeing yourself or negative
situations.
• Avoid negative coworkers. Nothing can ruin a positive attitude like coworkers who bring out the negatives in
everything. Avoid talking to those you know will only make you feel worse.
• Truly believe you are the best at your job. If you’re constantly looking for failures in your work and put on a
sour attitude you’re much more likely to actually be putting in a poor performance. If you think that you’re
good at your job you’re much more likely to put in the effort and performance that will make you good.
• Look for opportunity. In every failure there’s an opportunity to improve. Spend time thinking of ways you
can turn your setbacks at work into ways you can get ahead in the future.
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3. Personal Grooming
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IMPRESSIONS
You never get a second chance to make a positive first

impression.
Last impression is the lasting impression.
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Show confidence in your body language
Your body language speaks volumes. It can help you or it can hinder you. When you’re nervous, it
shows in the way you’re standing or what you’re doing with your hands. The same goes for when
you’re confident. Standing tall and making eye contact shows confidence.
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Greetings
Showing confidence when you greet someone for the first time gives a good first impression. You should
always do five things when meeting someone
- look them in the eye
- give a firm handshake
- greet them by name,
- say your own name slowly and clearly
- smile.
These will show the other person that you are positive and confident. Show the other person that the
meeting is important to you by thanking them for meeting with you and by always having a positive
attitude.
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Be aware of the way you speak
Speak clearly and with an even tone. You don’t want to be too loud or too quiet, as you could come across as
dominating or shy. We all have little language quirks, from regional slang to overusing filler words. Pay close
attention to the way you speak, as these things can make a negative first impression. Slang in general should
be avoided in professional settings when you’re dealing with someone in a position above yours. It’s fine
among colleagues and in more relaxed settings like an office party or out of office retreat.
Using filler words such as ‘um’ or ‘so’ or filling in gaps with ‘like’ or ‘you know’ will make you seem less
knowledgeable.
54
Put your phone away
Being on your phone equals rudeness in most professional settings. It indicates that you don’t care about
what’s currently happening and you aren’t fully committed or engaged. It doesn’t matter if you’re the
world’s best multi-tasker and being on your phone truly doesn’t take away your ability to listen when
someone’s talking. It comes across as rude and instantly creates a negative first impression.
Unless you need your phone to demonstrate something, it should not be in your hand.
55
Dress to impress
The way you present yourself starts with your clothing. Know the appropriate way to dress so you won’t be
underdressed or overdressed. If you’re going for a job interview, think about the type of company you’re interviewing
with. Startups usually have a more relaxed dress code, while corporate jobs usually require business casual. If you’re
not sure, business casual is always an appropriate choice.
You don’t have to spend a lot of money or go out and buy an entirely new wardrobe. What’s important is that your
clothes fit well and aren’t wrinkled. Invest in a work-appropriate bag or backpack as well. As for shoes, they simply
need to be professional. A good rule of thumb is no open-toed shoes, sleeveless dresses, or clothes that are baggy.
When in doubt, go with a pair of black pants and a blouse paired with conservative shoes and a simple bag.
We will discuss dress-up etiquettes in the coming slides.
56
Most important of all, be on time
This is simply good behavior and is non-negotiable. Do not be late! Being late always equals a bad first impression and is
one of the hardest mistakes to recover from. When in doubt, show up early. Being early can also help you relax and get
yourself in a good, positive frame of mind. If you’re rushing to get someplace, that’s what will be on your mind, and you
won’t be able to dedicate 100% of your energy to staying focused and confident, speaking with authority, and nailing
your first impression.
Think about a situation where you reach office late and a group of frustrated customers are waiting for you for long to
discuss their complaints!!!
57
Who will get hired by a Bank?
Dressing appropriately is very important in first impressions. Appropriate dress shows that you respect your
business and your customers. If you look successful and confident, then others will have more confidence in
you as well. Showing up to a meeting poorly groomed shows the other person that you do not care enough
about the meeting to bother making an effort. When you are dressed properly, there is also nothing to
distract others from your message.
58
What is Packaging?
“Packaging is engineering your image.” It includes:

Grooming
Wardrobe
Behavior
Body Language
Your Environment
59
Do I need Packaging?
How do you see yourself?

• Define how you are looking right now?
• Do you see what you were expecting?
How do people see you?

• Find out how someone else sees you as compared to how you see yourself.
Shouldn’t you package yourself as who you want to be?
60
Expected Standard Behavior
Respect Hierarchy
Employees should respect the hierarchies and the chain of command. Employees jumping ranks and reporting to
whomever they feel is unacceptable. Actions such as these demonstrate indifference and disrespect toward the
standing of higher ranked individuals. Implementation then becomes challenged because all in control do not have the
specific new information necessary. Disregard for the chain of command destroys the organization and inhibits proper
management skills from being implemented.
Show Loyalty
Just because an employee has been at the job for a long time doesn’t mean that employee is loyal, nor is an employee
who does everything her manager asks. Loyal employees are invested in the company and in their roles, regardless of
how long they’ve been at the company or how amenable they are to management requests. They feel like their work
means something and is important, and they believe in the company’s mission and vision. It shows in their everyday
work, and sometimes they will challenge management when they feel their integrity or the company’s is at stake.
Maintain Confidentiality
Customer confidentiality means keeping information about people who use your products and services private. When a
customer patronizes a business, he may have to give information such as his name, address or financial accounts.
Keeping customer records confidential establishes trust between the business and the client. Certain types of customer
information should always be protected, especially social security numbers and credit or checking account numbers.
61
Expected Standard Behavior
Acting Honorably
Respecting the customer is really just treating them the way you would like to be treated. Greet them, listen to them
help them!
Handle Complaints Promptly

Complaints happen every day. When a customer complains, it is usually for a good reason or genuine concern. They
usually have made a purchase that did not meet their expectation—a product, service, or maybe a combination of the
two. We must take care of the customer by listening to the complaint, and resolving it, to ensure a happy customer.
Fewer than half of unhappy customers will bring a complaint to your attention. Those who never say anything will tell
an average of 11 other people about their bad experience. It is important that we recognize complaints as
opportunities, so we can sway these averages, one resolved complaint at a time.
62
Why Personal Grooming is Important?
• Employees are expected at all times to present a professional, business like image to
customers, prospects and the public.
• A dress code is extremely important for maintaining the organization’s public image
and for promoting a productive work environment.
• Dress and personal appearance of the employees is a direct reflection on the identity
and image of the organization and plays a significant role in its success.
63
Dressing Guidelines
Male
• Suit: If dark, the shirt should be of either light color, thin stripes and not too broad
lines and the color of stripes should be also not clashing with the color of the suits.
• Shirts: Plain colored or light thin stripes/checks.
• Ties: Matching Conservative (Not Too Flashy of flowery)
• Trousers: Dark Navy Blue/Grey/Black. Lighter shades of the brown, blue & green.
• Shoes: Black/Brown – Comfortable & Clean. Avoid open toed shoes or sandals.
64
Dressing Guidelines
Female
• Shalwar/Kamiz: As per season but not hampering the workflow. No lose or baggy shirts,
or shirts with dropped corners or fancy cuts
• Wear low, conservative heels one can comfortably walk in. Do not wear casual slides or
high heels…court shoes are the best!
65
Dressing Guidelines - Suit
If the suit is dark, then the shirt should be

of light color. If you are wearing striped
shirt, the stripes should be fine or thin, not
too broad and the color of stripes should
not clash with that of the suit.
66
Dressing Guidelines - Shirt
 Plain color or thin stripes or checks.
 Avoid wearing dark shades at work

or patterned/flowery shirts.
 Should be wrinkle free.
67
68
Avoid wearing these colors
69
Dressing Guidelines – Ties
 Not too flashy
 Matching Conservative
 Well knotted
70
71
Dressing Guidelines – Trousers
 Dark Shades: Navy blue, grey and black
 Light Shades: Brown, blue and green
 Should be wrinkle-free
72
Dressing Guidelines – Trousers
73
Avoid wearing
74
Dressing Guidelines – Shoes
 Black/Brown: Comfortable and Clean.
 Avoid Sandals or open toed shoes.
75
Dressing Guidelines – Shoes
Avoid wearing
76
Socks
Should be black, grey, white Avoid wearing
77
Hair
Should be well combed Avoid
78
Dressing Guidelines – Females
 Shalwar/Kamiz or suit
 Well ironed, neat and clean
79
Dressing Guidelines – Hair (Females)
 Hair style should be simple
 Hair should be tied at the back in a bun or a neat pony.
80
Dressing Guidelines – Shoes (Females)
 Avoid High Heels
 Avoid flashy colors and sandals

with stones and flowers.
 Shoes should be in neutral colors,

with a back strap.
81
Dressing Guidelines – Jewelry
 For men - Restricted only to a ring and a watch.
 No earring, bracelet or chain.
 For women – avoid wearing large and dangling

jewellery like earrings, necklace, bangles and
anklets. Simple ear studs, rings, bracelet and watch
are acceptable.
82
Business Attire
 What you wear reflects your

personality and shows respect for the
person you are interacting with or the
organization you are working with.
 On casual days wear smart casual.
83
Hygiene
 Body Odor
 Dental Care
 Feet and Underarms
84
Important Points (for males)
• Shave Regularly - Facial hair/beard neatly trimmed.

• Use mint or mouth freshener during a break.
• Hair: Neat & tidy - Not too oily – Gel can be used.
• Dress watch, cufflinks be used.
• Do not use deodorant/perfume with very strong fragrance.
85
Important Points (for females)
• Use mint or mouth freshener during a break.

• Hair: Neat & tidy - Not too oily
• Make up should not be very loud– Keep a natural look.
• Hair should not be loose and all over the place but rather
styled or worn swept up
86
Dining Etiquettes
 Business Lunch is more for

networking and less for eating.
 Place napkin on your lap and do
not wipe your face or nose with it..
 Start eating when everyone else
starts eating.
 Form a line in a BUFFET. Do not cut
lines.
 Don’t eat like its your last meal.
 Do not make munching sounds
while eating.
87
Time Management and Office Environment
 Time is precious, time is money.

 Be punctual for office and for
meetings.
 Prioritize your work on the basis of
importance and deadlines.
 Keep your work area neat and
clean and your desk organized.
 Use shared spaces properly.
88
Things to avoid
 Pan, gutka, gum

 Inappropriate gestures (yawning,
stretching)
 Playing with mobile phone
 Talking/laughing loudly
 Staring at people
 Interrupting other people while they are
talking
89
Introducing Yourself
 Stand when you meet someone for the

first time.
 Maintain eye contact.
 Smile.
 Shake hand with a soft but firm grip
 A nod or verbal greeting
 Say your name clearly.
90
Greetings
Exchange Business Cards with both hands.
91
Introducing Someone Else
 First, state the name of the person being

introduced to. This is the ‘higher-ranking’ person.
 Second, say “I would like to introduce” or, “please
meet” or, “this is,” etc.
 Third, state the name of the person being
introduced. This is the ‘lower-ranking’ person.
 Finally, offer some details about each, as
appropriate. As I wrote in a previous article, add a
snippet of information about a topic of common
interest between the two parties. Do not
elaborate. This will help them connect and pursue
a conversation.
92
Types of handshakes that people commonly do
Handshake with both hands
93
The Topper
94
The Pull-In
95
The Finger Squeeze
96
The Bone Crusher
97
The Proper Handshake
• Firm, but not bone-crushing

• Lasts about 3 seconds
• May be "pumped" once or twice
from the elbow
• Is released after the shake, even if
the introduction continues
• Includes good eye contact with the
other person
• Wipe your hand if wet due to sweat
98
Cultural Differences
• Shaking hands may seem like a perfectly normal way of greeting a business
contact. Not necessarily, though. What happens if the other person doesn’t offer
their hand? Or if you’re a woman in a conservative Muslim culture? Or if your
counterpart is greeting you with a bow?
• Master the handshake specific to the country you are visiting. In Muslim areas,
touch your left hand to your chest as you shake hands, as a sign of additional
deference.
• Do not try to shake a woman’s hand unless she extends hers.
99
Speaking with Confidence
Slow down
The most common mistake people make that prevents them from speaking with confidence is speaking too quickly.
When a person speaks quickly it often gives the impression that he’s nervous, insecure, or lacks self-control. It’s crucial
then to practice speaking at a slower, more relaxed pace. Speaking in a calm, deliberate manner shows confidence –
even dominance.
When to start speaking

A similar mistake people make is that they rush into speaking. During a conversation a person may start talking the
same moment (or even moments before) the other person finishes speaking. Jumping in and talking immediately like
this can make a person look a little too eager.
Eliminate filler words

Filler words (words as “umm”, “uhh””, “like…”, etc.) are used to take up space while a person tries to figure out what to
say next. But using them just makes a person look uncertain of what he’s saying. So if you want to sound more
confident when speaking, eliminate these filler words completely.
Don’t just be loud

People sometimes confuse speaking with confidence as speaking loudly. While speaking loud enough to be heard is
important, what matters even more that volume is your pitch and cadence (cadence is basically the rhythm of your
voice). Maintaining a low, steady tone of voice is a surefire way to sound more confident.
100
Speaking with Confidence
Speaking without tension
That low, dominant tone that makes you sound confident comes about naturally when you release the tension in your
voice. The muscles in your shoulders, neck, jaw and throat all affect your voice tone so you want to relax those muscles
when speaking. To get those muscles relaxed here’s an exercise you can try: Start by taking a slow, deep breath. As you
exhale make a noise that’s half yawn/half sigh and soften any tension you feel in your jaw, throat, neck and shoulders.
This exercise will help you become aware of the existing tension in your voice so that you’ll be able to relax that tension
when speaking.
The importance of breathe

Taking slow, steady, deep breaths as you speak will ensure you have a slow, steady, deep voice. The key to obtaining this
kind of breath is to make sure that you’re not just breathing into your chest but instead are breathing deep into your
belly.
Stay present
A lot of the problems mentioned above – speaking too quickly, tightening your voice, breathing into the chest instead of
the belly – come about when we lose presence. It’s when we get so wrapped up in what we should say next (or what
people might think of us) that these bad habits take hold. To prevent this, stay aware of the sound of your voice when
you speak. This will keep you grounded so those nasty habits won’t come creeping in unnoticed.
101
The Art of Giving Compliments
Abraham Lincoln once said,
“Everybody likes a compliment.”
102
The Art of Giving Compliments
As you can see, giving a compliment is a win-win situation for everyone. If you want to
master the art of giving a compliment, you need to remember these key points:
• Be Specific.
• Be Genuine.
• Keep It Unique.
• Keep It Short And Sweet.
• Be Timely.
• Be Sincere.
• Don't compare.
• Don’t Expect Anything In Return.
• Finish With A Question.
103
Receiving Compliments
• Smile
• Say Thank You
• Never try to shrug off a compliment or disagree with the person who is trying to
compliment you
104
4. Account Opening and Operations
105
Learning Objectives
• Explain the concept, objectives and importance of KYC/CDD

• Explain the KYC/CDD process in detail
• Apply KYC/CDD for different types of customers
• Identify and approach potential customers for cross-selling
• Explain the regulatory requirements of account opening and
operations
106
Account Opening
The banker-customer relationship and the importance of the account opening.

• Account opening is the first step to enter into the customer- banker
relationship. Individual savers, investors, businessmen, corporations and
other institutions use bank accounts to secure their savings, money, meet
daily cash needs and earn profit. It is a critical stage wherein financial
institutions can use customer information for business development, risks
mitigation and regulatory requirements compliance.
107
Functions of Branch Banking Operations
1. Account Opening – KYC & AML

2. Cash Operations
3. Remittances & Fund Transfers
4. Clearing
5. Online Banking
6. M.I.S – Reporting and Reconciliation
7. Liaise with Head office, Zonal office, Internal & external auditors
8. Branch targets
108
Benefits of Account Opening - Customers
• Safety First: With your money in a bank , it won’t get lost or stolen. It’s also safe in an
emergency like an earthquake, a flood or a fire.
• Convenience: With Online Bill Pay, it’s easy to transfer your money electronically to the
people you need to pay. There’s no need to carry too much cash, and you can track your
expenses on the computer to keep you on your budget.
• Cheaper Money: When you open a bank account, you get access to bank services for
reduced costs, or even for free. Having a relationship with a bank means that you can save
money on fees and other loans.
• Out of Sight, Out of Mind: Direct deposit your paychecks in a bank instead of carrying
around a bunch of bills and you’ll be less tempted to spend your money on things you don’t
need. In these times, we all need a little help controlling our spending habits!
109
State Bank Circular
State Bank of Pakistan Debars from levying any

service charges for opening & maintenance of
savings accounts
110
Why Central Bank want people to open accounts
• It will provide access to documentation
• It will help in taxation purpose
• To reduce dependency on aid, remittance.
111
Types of Accounts
• Savings
• Current or Demand deposits
• Time/Term Deposit
• Basic Banking Account
• Trust/Club/Society Accounts
• Pension account
112
Savings Account
• Savings Account are meant for saving purposes.

• Saving means setting aside some amount of money
for future use
• Profit is paid on the balance maintained as per PLS
rules of the bank
113
Current Account
• Account from which any part of the balance may

be withdrawn on demand.
• These accounts are generally for business purposes
and can be overdrawn on arrangement with the
bank
• Zakat is not deducted on current accounts
114
Term Deposit Accounts
• Term deposit are those deposits that are repayable

after a determined future date.
• Such deposit transactions may be for a period
ranging from 1 month, 3 months, 6 months, 1 year
and onwards.
115
Basic Banking Accounts (BBA)
• BBA accounts were introduced by SBP , with special features to facilitate low income
people in Pakistan.
• Prior to the introduction of BBA accounts the banks used to collect service charges from
all the customers who failed to maintain a minimum balance.
• Initial deposit of Rs. 1000/-
• No profit is paid in this account
• No minimum balance required and no service charges to be paid
• If account remains NIL for continuous six months, the bank has the right to close it
• Maximum two deposits and two cheque withdrawals are allowed free of charges in one
month
• Unlimited free of charge ATM withdrawals
• A regular banking account can be converted to BBA on customer request
116
Cash Management Account
• Cash Management account is a banking service

provided to the high profile business customers
through which they can speedily obtain funds from
their collection accounts to the main accounts
117
Collection Accounts
• Collection Accounts are opened for collection of funds at the request of

the business customers, charitable institutions and the institutions of the
government
• A main account is opened in any branch of the bank.
• In lieu of this main account collection accounts are opened in other
branches where funds are transferred to main account as per
instruction/arrangement.
• Example PTCL , KESC , SSGC, Wapda etc
118
Share Subscription Account
• When a public limited company floats its shares for

subscription, it has to open accounts in the banks
that are called “Bankers to the issue”
• These banks authorize their branches to collect
shares application from public
• This is ultimately transferred to a main account of the
bank on the closing date of subscription.
119
Nature of Accounts
Individual Partnership Minor Account
Inactive
Unclaimed Account Deceased Account
Account(Dormant)
Miscellaneous
Blocked Account
Account
120
Individual Account
• Who may open an account?

• Contract Act – Adult, Sane
• Who is incapable to open an account - insolvent or
insane
• Minor Accounts?
• Formalities for opening of an account?
• Introduction’ no more compulsory but identity, integrity,
reliability, not non-existent; bona fides
• SBP’s instructions for “Know Your Customer”;
121
Joint Account
The opening of joint account includes the following;
1. Two (2) or more persons.

2. Singly or jointly operated.
3. All holders must sign the application.
4. Obtain the original CNICs.
5. Photo copy & attest.
6. Assign account number.
122
Joint Stock Companies
Limited Companies – A company may be

a) A company limited by shares or
b) A company limited by guarantee (e.g. IBP)
c) A single member company
d) A private limited company
e) A public limited company
123
Minor’s Account
• A minor is a person who has not completed the age of 18 years.

• In case a guardian of his person or property is appointed by the court before he
completes 18 years, the age of minority is extended up to 21 years
• A minor is not competent to enter into a contract
• Agreement with minor can not be ratified even on attaining majority
• Two types of Accounts may be opened for minors:

• Opened and operated independently (Self)
• Opened and operated by the guardian
• Opened & Operated by Minor
• Minor must be at least ten years of age.
• Must be capable of signing in firm hand.
• Parent must give approval as well as introduction.
• Minors will not be allowed to issue cheques to third party.
124
Minor’s Account
Following are some of the important points regarding minor’s account :
• Misrepresentation of age – No estoppels against him and the contract is

void.
• Money lent to a minor can not be recovered.
• Minor can repudiate his promise.
• No charge can exist on his securities/properties.
• Minor can recover a security which he had earlier pledged for any loan.
125
Inactive Account (Dormant)
• No operation within 6 months

• All entries are restricted other than computer
governed and bank charges
• Joint cancellation/Supervision
• Re-activated after meeting with customer giving valid
reason and confirmation of identity
126
Unclaimed Account
• As per SBP directives any account having no operation for more than 10
years will be categorized as unclaimed account
• Intimation made to customer 6 months before
• Balance transfer to SBP through head office
• When approached by the customer for payment, after proper scrutiny
and identification claim is lodged with SBP
• Payments to customer after receipts of balances from SBP
• List of unclaimed A/c to be placed on the notice board
127
Deceased Account
The account may be treated as deceased soon the intimation/notice received

regarding death of the customer. The contractual relationship ends after intimation.
Balance encircled and remarks made (No operations, the customer reported dead).
For settlement legal heirs advised to submit documents as per law/bank policy.
Payment made as per policy after approval from competent authority.
• Notice of customers death

• Intimation by legal heirs
• Contractual relationship
• Approval of competent authority/Opinion of Law/legal division
• Documentation, death and succession certificates obtained
• In proprietorship and partnership, death of any one person/partner dissolves the
firm.
128
Blocked Account
The accounts which are blocked as per directives of State bank/order of the
court or respective bank policy. No operation will be allowed until fulfillment of
the conditions leading to the blockage of account.
May be blocked
• Due to court order
• Due to regulatory directives of SBP
• Due to suspicious transaction blocked by compliance
• Transaction restricted temporarily (non submission of documents for account

opening form/Non verification of CNIC)
• Operation permitted after proper clearance
• Security/Margin Deposit
129
Miscellaneous Accounts
• When the title of account and the account number is

missing or does not tally. It will be categorized as
miscellaneous account.
• Payment will be made to the customer after receiving
request and matching counterfoil with original
voucher.
• Flood, Earthquake, Natural Calamities etc
• Welfare/Zakat Account
130
CDD, EDD and Market Intel
• Market Intel is essential to ensure that the proper

CDD and EDD process has been completed.
• Market Intel is research typically conducted by the

banker to collect relevant information about the
concerned party.
131
Types of Market Information
Market Check/Rapport Check:

Refers to the type of information where we identify and determine the concerned party’s
(consumer/corporate) market credibility, assess relationship with stake holders, verification
of documents, verification of business assets, and overall reputation in the market.
Financial information:
Refers to the type of information where we determine the financial stability of the
party(ies) which includes business sales turnover, bank balances, income, receivables,
payables, assets and sources of funds.
Credit Information:
Refers to the type of information where you try to determine credit history which includes
any overdues, current exposure both fund and non-fund based, number of times of
restructuring, Write offs and amount under litigation of party (ies) involved in a suspicious
transaction.
132
Importance/Usefulness
Informed Decision-making
Identification of unusual activity and/or red flags
Identification of undisclosed information
Confirmation of the disclosed information
Identification of any loopholes in the processes
133
Resource Networks
• Resource network is an interconnected group of

available friends, peers, agencies, help desks,
information bureaus and associations which provide
information about entities, consumers, sectors,
industries they deal with in order to facilitate all stake
holders.
• Larger is better - Keep it growing
134
Examples of resource networks
• Public agencies • Private agencies

• NADRA • Data check (Pvt.)
• eCIB Limited
• SMEDA • ICIL/ PakBizInfo
• APTMA • Credit Chex (Pvt.)
• Limited
FBR
• JCR-VIS (VIS)
• TDAP
• PACRA
• OCAC
• Registrar
135
The do’s and the don’ts
Dos
 Clear understanding of what information is required.
 Create a plan to gather the data.
 Compile relevant documents. Don’t waste time on
additional but irrelevant documents.
Don’ts
 Never share any information gathered with any unrelated
party.
 The customer should be oblivious to the research process.
136
Account Opening Process
Centralized
Operations
Documentation • Final scrutiny of
documents
• Get required • Open account
documents • Send the cheque
• Initial scrutiny book and ATM at
• CDD
Initial meeting customer address
• Walk-in customer
• Sales call
137
Account Opening Process
The account opening process and the three major steps:

- Initial Meeting: It is the first step. This step may be initiated if the customer walks into
the bank to acquire their services. The other alternate starting point could be that the
bank staff has made a sales call and the customer has agreed to enter the relationship.
- Documentation: The meeting is followed by the acquisition of required documents (as
per bank policy and regulations of the central bank) and initial scrutiny of the same. In
addition, the customer due diligence (knowing the customer) process is initiated at this
step.
- Documents collected from the customer and the CDD/KYC documentation is then sent
to the centralized operations for further processing. After due processing, the account
is opened and the customer and his/her branch is notified. The cheque book and the
ATM are sent out to the customer’s address. Some banks do not send cheque books or
ATM cards to the customer. Instead, the customer must always collect these in person.
Some banks follow this for the first cheque book only.
138
CDD/KYC – The Concept
The CDD/KYC concept is to conduct proper customer due diligence

- To know who you are dealing with
- To identify risk associated with the customer
- To verify the sources of funds
- To check market rapport
- Answer the following questions:
- Do you know who you are dealing with?
- Do you know what your customer’s circumstances/business/activities are?
- What is your customer’s net worth, income, business turnover ?
- For how long is your customer in the business? Is he well known around the market?
- What type of reputation does your customer has?
- Can your customer be engaged in money laundering?
139
CDD/KYC
Regulatory Requirement
CDD/KYC is a regulatory requirement. This means that all banks have to build this process into their systems and ensure
compliance with the same.
Operational challenge
Conducting proper CDD is a very big operational challenge for banks. There are multiple reasons for the same. The first
and foremost reason is that with the speed with which operations are conducted, it is difficult to spend enough time
with each customer. A single meeting with the customer is not enough to determine all details.
Is it simple enough to know a customer in a short meeting? The answer is NO!
Criticality of CDD/KYC
It is extremely critical for financial institutions to “know their customers”. They must conduct due diligence before they
enter into any customer-banker relationship. Absence of CDD/KYC would result in fraudulent activity and money
laundering.
Documentation of transactions
CDD/KYC also includes documentation of transactions that a customer conducts with a bank. Although this will be
discussed in more detailed on further slides, the introduction to the need for transaction documentation to identify and
monitor early warning signals.
140
CDD/KYC – A tool to combat money laundering
Money Laundering is the process of disguising illegal sources of money so that it looks like it
came from legal sources. Regardless of the difficulty in measurement, the amount of money
laundered each year is in the billions (US dollars) and poses a significant policy concern for
governments. As a result, governments and international bodies have undertaken efforts to
deter, prevent and apprehend money launderers. Financial institutions have likewise
undertaken efforts to prevent and detect transactions involving dirty money, both as a result of
government requirements and to avoid the reputational risk involved.
KYC is also an effective tool for anti money laundering.

- It helps in making proper account profiling and indentifying the breaches at early stages
- Its helps in identifying unusual activity in the account which does not match with the
customer profile
- A branch should monitor suspicious transactions done in any accounts.
- Based on the customer’s account utilization, they are assigned different risk level/categories.
141
Importance of CDD/KYC
• Risks that can be mitigated

• Reputational
• Operational
• Legal
• Financial
• Concentration
• Regulatory
142
Benefits of an effective CDD/KYC policy
The benefits of an effective CDD/KYC policy for a bank or financial institution are:
• KYC helps us judge the actual profile of the customer. This process helps judge if the customer is
suspicious or not.
• KYC helps detect suspicious activity in a timely manner if we know the customer belongs to a certain risk
level where there are chances of money laundering or if he/she is going against the profile mentioned in
KYC.
• Ensures banking laws are in compliance and as per the policies and regulations.
• Effective KYC policy will lead to a clean and safe banking practice. Everything remains under control if
KYC profiles are in order and periodic reviews are conducted.
• An effective KYC reduces the risk of fraudulent activities. Hence the bank and its reputation stay safe
guard and this increases the credibility of the bank resulting in increase in customer flow and profits.
• Effective KYC reduces the risk of loosing bank’s assets, as it will save customers from incidents of money
laundering and fraudulent activity.
• Minimizes the risk that the bank will be used for illicit activities
• Reduce the risk of losing bank’s assets
• Protects the bank’s reputation
143
5. Cash Handling/ Clean Note Policy
144
The Competencies Needed to be a Bank Teller
The key competencies of a Bank teller can be divided into three sections:
• social intelligence,
• cognitive abilities, and
• potential job performance.
Social Intelligence
• Agreeableness Tellers regularly interact with people – both customers as well as co-workers. As a representative of
the bank, it’s important for tellers to be pleasant, tactful, and caring.
• Communication skills – When interacting with customers, it’s of utmost importance to listen closely and carefully. In
addition to making your customers feel that they are cared for, listening to your customers will also help you to
understand their needs. You should also know how to converse with customers – addressing the customer and
establishing rapport, maintaining pleasant conversation and coping with difficult situations such as unreasonable
requests or interactions with angry customers.
• Confidentiality – Respect your customer’s privacy and make sure that sensitive information remains confidential.
• Empathy - Understand your customer's feelings and his or her situation.
• Teamwork – Tellers function as part of a team. Be helpful, cooperative, and remember that the way you do your job
affects your teammates.
• Working under a supervisor – It’s important to build a good relationship with your supervisor and to have his or her
support. Ask your supervisor for advice and also make suggestions, with regard to whatever the situation may be. Be
sure to be a respectful and loyal employee and team member. 145
Cognitive Abilities
• Judgment – Tellers often face conflicts which require them to prioritize and make decisions.
• Decision making – When facing such conflicts or helping customers with problems, tellers need to
analyze the issue at hand and find solutions that address the customer’s needs while adhering to the
bank’s policies.
• Accuracy and attention to details – The teller’s job requires precision, thoroughness, and accuracy
in order to avoid errors.
• Be alert - Tellers must be alert and attentive to any suspicious signs indicating fraud.
• Work habits – Since efficiency and punctuality are vital for being a good teller, it’s important to work
in an organized and orderly manner and to maintain an organized work environment.
• Working quickly – Since customers appreciate short waiting times, tellers need to efficiently balance
thoroughness, precision, and working swiftly.
146
Potential Job Performance

• Conscientiousness – Have the desire to be a good, hard-working employee. Be thorough when you take action and
make sure customers understand the information which tellers provide to them.
• Follow procedures –Financial institutions, such as banks, have many regulations and procedures. It is crucial to be
familiar with these regulations and procedures and how to properly maintain them. This includes knowing which
rules are strict and which are flexible. An irregular situation may arise and you may want to ask your supervisor to
make an exception for the customer in question.
• Loyalty to the bank – Being a representative of the bank, thus, maintaining customer satisfaction as well as the
bank’s interests is essential.
• Stress tolerance – A bank can sometimes be a stressful environment. When faced with a long line or a difficult
customer, it is important to maintain a high level of professionalism and remain calm. When working with
customers or co-workers, be able to take criticism and learn from it.
• Openness to new experiences – Be creative, flexible, and able adapt to a constantly evolving environment.
• Be proactive – Go the extra mile. When coping with a problem, find creative solutions and be sure to follow up on
the problem.
• Be a salesperson – As a teller, it is part of the job to sell services that the bank provides. The best way to do this is
to address the customer's needs – offer the customer a service that will solve a problem or inconvenience or will
simply make banking easier according to each customer's individual needs.
• Be knowledgeable – Become an expert in the banking field: be familiar with the bank’s services and procedures.
This will save a teller’s time, enabling to better answer questions, and avoid making mistakes.
147
Clean Note Policy
Banking Policy & Regulations Department of State Bank of Pakistan in January 2010 issues a circular
stating Clean Note Policy to the banks of Pakistan. The key focus of the policy is to overcome the
problems relating to collection, sorting and replacement of soiled notes and to provide better services
to general public.
As per the policy all bank are to ensure the following;
a. Branches have been preparing and maintaining the prescribed statement of daily closing cash balances.
b. Branches have been maintaining minimum One day’s fresh / re-issuable balance in accordance with the
average daily cash payment requirements except of the branches which are exempted from this condition:
• Branches making an average daily payment of less than Rs. 0.50 million.
• Branches having immediate access to re-issuable good quality currency notes such as withdrawal facility
from the large branch of the same bank in the same city, SBP BSC local Offices / NBP Chests.
c. Branches have been properly sorting Bank Note packets / bundles into issuable/ nonissuable as per SBP BSC
standards and no instances have been observed where nonissuable notes / packets are being put into
circulation by the branches.
148
Clean Note Policy
d. Branches have been making arrangements for on spot sorting of bank notes over the counter, in case where
average daily payment is exceeding Rs. 1.50 million.
e. Branches have been affixing Sorted stamps on packets of issuable / non-issuable bank notes of either
description “ISSUABLE” or “SOILED”.
f. Branches have been accepting small denomination bank notes of Rs. 5/-, Rs. 10/- & Rs. 20/- as well as cut /
soiled / mutilated and defective currency notes of all denominations.
g. Branches have been removing staple pins from re-issuable packets of all denominations.
h. Branches have been banding packets of all denomination Bank Notes.
i. Branches have been following the procedure for issuance of fresh currency to general public / stakeholders, as
issued by SBP BSC (Bank).
j. Branches have been maintaining sufficient stock of coins of Re 1, Rs 2 and Rs.5/- denominations.
k. Branches have been accepting coins and are providing notes-coins exchange facility.
l. There are no forged notes in branch balances or ATM.
m. Branches have not been repeating the irregularities pointed out in the previous report.
n. Branches have not been using strong room / vault for other purposes like record room, kitchen, stationery store
etc.
149
Category of Currency Notes
Fresh Notes:
Currency notes that are issues for the first time after receipt form Pakistan Security Printing Press.
Reissuable Notes:
Currency notes in good physical condition and free from any defect like alteration, cut, mismatch etc. being
issued after sorting as good quality reissuable notes.
Soiled Notes:
Currency notes which become dirty and limp due to excessive use are defined as Soiled notes. Double
number note cut into two pieces either horizontally or vertically but on which both the number are intact is
now being treated as soiled notes.
Clear Payable Defective Notes:
Partially cut, damaged or slightly burnt notes provided 3/4th portion thereof be intactare classified as clear
payable notes.
Mutilated and Claim Notes:
The notes which are oily, torn into many pieces, disfigured, burnt, washed, eaten by white ants etc. are
classified as claim notes that can be tendered at all field offices of SBP BSC and commercial bank branches
to obtain exchange value.
150
Counterfeit Notes
A counterfeit is an imitation that is made with intent to dishonestly represent

its content or original.
The word counterfeit most frequently describes forged money or document.
Counterfeit money is currency that is produced without the legal sanction of

the state or government.
151
How to spot Counterfeit Currency
 Look at the note.

 Feel the note .
 Look at the print.
 Feel the print
 Endeavour to tear the note.
 Hold the note up to the light
 Use magnifying glass.
 Use ultra-violet lamp.
152
Tools for Counterfeit Detection
 Ultraviolet Lamps
 Counterfeit Detecting Machines
 Magnifiers
Most effective tool to recognize a genuine Currency Note is
 Your Finger’s tips
153
Classification of Security Features
OVERT (open): Features for PUBLIC.

Recognizable by general public with no special knowledge.
SEMI-COVERT: Features for CASHIER and other Bank staff.

Recognizable by trained staff with the use of simple equipment like Ultra Violet lamp or
magnifying lens.
COVERT/FORENSIC : Features for LABORATORY and AGENCIES.

Features recognized by highly trained experts using special equipments like Microscope,
Spectroscope, special frequency UV lamps and chemicals. Machine readable features are also
included in this category.
154
10 Rupee Note
Rs. 10 Denomination
Size 65 x 115 mm
Color Green
Issue Date 27-05-2006
Back Vignette Gate of Khyber
155
20 Rupee Note
Rs. 20 Denomination
Size 65 x 123 mm
Color Orange Green
Back Vignette Moen Jo Daro
156
50 Rupee Note
Rs. 50 Denomination
Size 65 x 131 mm
Color Purple
Back Vignette Karakoram Peak
157
100 Rupee Note
Rs. 100 Denomination
Size 65 x 139 mm
Color Red
Back Vignette Ziarat Residency
158
500 Rupee Note
Rs. 500 Denomination
Size 65 x 147 mm
Color Green
Back Vignette Badshahi Mosque Lahore
159
1000 Rupee Note
Rs. 1,000 Denomination
Size 65 x 155 mm
Color Dark Blue
Back Vignette Islamia College Peshawar
160
5000 Rupee Note
Rs. 5,000 Denomination
Size 65 x 163 mm
Color Mustard

Shah Faisal Mosque
Back Vignette
Islamabad
161
Procedure for Cash Payment
PROCEDURE:
• Customer / Bearer
• Signature on reverse of cheque
• Scrutiny of the cheque
• Cheque of illiterate person
• Call back
• Verification of signature
• Teller’s limit
• Defacing cheque
• 2nd signature
• Denomination & stamping
162
SBP Penalties on CPC / Branches
Description Penalty per Penalty per Unit in RS.

Instance
Issuance of Unauthenticated and 100,000/- NA
Unprocessed banknotes to public.
Packets and bundles are not prepared / NA
packed as per requisite specification. 20,000/-
The Vault does not have insurance 10,000/- NA

cover in line with value of cash held.
The entire CPC / Sorting area is not The Entire CPC / Sorting
covered by high resolution CCTV 20,000/- area is not covered by high
cameras. resolution CCTV cameras.
Recording of CCTV camera is not NA 10,000/- Per day.
available for three months.
163
Penalties on Cash Management
Nature of Violation Scale of Penalties

For not maintaining statement of daily closing Rs.5,000/- per instance plus Rs.500/- per
cash balance day the default continue
Maintenance of minimum One Day’s fresh re- Rs.5,000/- per instance plus Rs.500/- per
issueable balance in average daily cash day during which the default continue
payment requirements
For Not properly sorting Bank Note Rs.5,000/- per instance plus Rs.500/- per
Packets/Bundle-issuable/Non-issueable packet of un-sorted / non-issue able
condition over the payment counter currency notes of any denomination,
164
Penalties on Cash Management
Nature of Violation Scale of Penalties

For Spot sorting of bank notes over the counter Rs.5,000/- per instance.
in case where average daily payment is
exceeding Rs.1.50 million.
For not affixing “SORTED” stamps on packet of Rs.500/- per packet of any
bank notes. denomination if caught during on site
examination.
For not accepting small denomination bank Rs.10,000/- per case with evidence.
notes of Rs.5/-,10/-& 20/- as well as
cut / Soiled / Mutilated & defective.
For not removing the Staple Pins from packet of Rs.500/- per packet.
all denomination bank notes and not properly
banding.
165
How to avoid penalties
 State bank of Pakistan accounts department circulars no. 1 and 02 dated the 5th
march 2004 should be thoroughly studied.
 The instructions laid down should be followed in letter and spirit
 The copies of above circulars have been sent to all the banks
 Have a clear concept of the categories of notes.
166
Frequent Irregularities causing Penalties
 Soiled / defective notes were found mixed with the issuable notes meant for issuance
to public.
 Some packets were seen affixed -sorted stamp but soiled / defective were found
therein.
 Branches were meeting cash requirements by pushing back unsorted notes received
over the counter.
167
National Prize Bonds - Sale / Purchase
• Branches are required to maintain denomination wise register of National Prize Bonds.
• National Prize Bonds are sold to customers against cash / cheque (drawn on the same
branch or remote branch).
• The CT / Teller counts cash or scrutinizes cheque for its:
• Validity (Stale/post dated).
• Amount in words / figures agree.
• Cheque is bearer and does not bear any endorsement
• Cheque is not mutilated
• Alteration/addition/cutting, if any, is confirmed by customer
• The CT/ Teller confirms title of account (if mentioned on Cheque) & number and posts
debit in the system against balance available in the relevant account. Detail of NPBs
denomination issued is mentioned on the reverse of the cheque.
• All the transactions will be posted/supervised instantly
168
6. Compliance/ Internal Control
169
Learning Objectives
• Explain the concept and scope of compliance

• Differentiate between compliance, audit and internal control
• Discuss the importance, process and scope of regulatory compliance
• Explain the internal control techniques of that help avoid compliance lapses at
the branch level
• List the types of common exceptions that occur at bank branches
• Explain the process of reporting and resolution of common exceptions at
branches
170
Compliance
171
Compliance
Compliance means conforming with stated requirements. At an organizational level, it

is achieved through management processes which identify the applicable
requirements (defined for example in laws, regulations, contracts, strategies and
policies), assess the state of compliance, assess the risks and potential costs of non-
compliance against the projected expenses to achieve compliance, and hence
prioritize, fund and initiate any corrective actions deemed necessary.
In general, compliance means conforming to a rule, such as a specification, policy,

standard or law. Regulatory compliance describes the goal that corporations or public
agencies aspire to in their efforts to ensure that personnel are aware of and take
steps to comply with relevant laws and regulations.
Due to the increasing number of regulations and need for operational transparency,
organizations are increasingly adopting the use of consolidated and harmonized sets
of compliance controls. This approach is used to ensure that all necessary governance
requirements can be met without the unnecessary duplication of effort and activity
from resources.
172
Compliance
• Conforming with stated requirements

• At the organizational level, it is achieved through
• Identification of applicable requirements
• Assessment of the state of compliance
• Assessment of risks/costs of non-compliance
• Taking corrective actions (as required)
173
Scope of compliance
• Compliance with the internal policies and guidelines including (but

not limited to)
• Service Quality Standards
• Operational Standards
• Workplace Requirements and Standards
• Compliance with the regulatory requirements

• Central Bank Regulations
• Central Bank Notifications, Circulars, Manuals
• BASEL
174
Scope of compliance
a) Compliance with the internal policies and guidelines. This includes

(and is not limited to)
1.Service Quality Standards – All banks have a minimum set of service
standards that they must follow
2.Operational Standards – All transactions have specific process flows that must
be followed to the letter
3.Workplace Requirements and Standards – All organizations including banks
have workplace requirements and standards which must be diligently
followed by all employees. This includes the elements of presentable
personality, work ethics, efficiency, reliability and work ownership among
other items.
175
Scope of compliance
b) Compliance with the regulatory requirements. This includes

1.Central Bank Regulations – The central bank (SBP) has released prudential
regulations related to commercial, corporate, consumer banking, etc. All
regulations must be followed in letter and spirit.
2.Central Bank Notifications, Circulars and Manuals – The central bank (SBP)
also releases notifications and circulars occasionally which must be followed
by the banks and financial institutions. In addition, the SBP has also made
manuals available for the banks to be used when designing the process flows.
3.BASEL Accords – Basel I, II and III banking supervision accords.
176
Internal Control
Internal control is the systems, policies, procedures, and processes

effected by the board of directors, management, and other personnel
to safeguard bank assets, limit or control risks, and achieve a bank’s
objectives.
177
Internal Control – Benefits
• Effective controls are the foundation of sound banking

• Protection of the organization's resources, both physical and intangible.
• Timely feedback on the achievement of operational or strategic goals
• Compliance with laws and regulations.
• Plays an important role in preventing and detecting fraud and protecting the
organization's resources, both physical and intangible.
• Reliability of financial reporting, timely feedback on the achievement of
operational or strategic goals, and compliance with laws and regulations.
178
Internal Audit
Internal audit provides “an objective, independent review

of bank activities, internal controls, and management
information systems to help the board and management
monitor and evaluate internal control adequacy and
effectiveness”.
179
Controls, Compliance and Audit
Audit
• Audit
Compliance Department
• Central Bank
• Compliance (SBP)
Department
Controls
• Control
Department
180
• Controls, compliance and audit functions go hand-in-hand.
• The controls department/unit sets up the controls for all processes and
transactions at the bank. This is carried out to ensure that the processes or
transactions do not have any loopholes available in them. In addition, the
controls are set as prescribed by the central bank (which are again based on best
practices which have emerged out of the different banks and based on
experience of the bankers locally and globally).
181
• The compliance function ensures compliance with all requirements – internal and
regulatory. The compliance function issues guidelines for ensuring that all
internal requirements (which mean the standards and controls set for processes,
transactions, functions) are met. It allows issues guidelines for ensuring that the
regulatory requirements are also met. Compliance also performs monitoring
function.
182
• Audits are carried out by the bank’s internal department as well as

the central bank. The bank’s internal audit verifies and validates that
all branches have in actual complied with requirements given to them
and have not conducted any processes or transactions that are in
breach of the guidelines.
• In addition, the SBP (central bank) also sends its auditors to banks to
ensure compliance with the regulations and guidelines as set by
them.
183
Responsibility of Control and Compliance
• Higher Management is responsible to communicate and

provide proper training to branch staff
• Managers must always ensure that proper control processes
are in place
• Staff should be made accountable for any negligence
• Staff should always carry out proper due diligence before
executing any transaction
184
Strengthening Control and Compliance
• The staff must commit to the policies, procedures and

processes
• All policies, procedures and processes must be owned in
letter and spirit
• The manager must set the tone for follow-up
• Staff training and orientation is of utmost importance to
ensure compliance as well as strong controls
185
Ten Things to Strengthen Internal Controls
1. Ensure duties are segregated

2. Develop adequate physical control of assets
3. Identify risks in the organization
4. Correct Errors Promptly
5. Perform Reconciliations Regularly
6. Develop Written Policies and Procedures
7. Review and Approve Processes
8. Maintain Adequate Supporting Documentation
9. Provide Adequate Training to Staff
10.Perform a Self-Evaluation of Internal Control
186
Regulatory Framework
• Banking Companies Ordinance 1962

• Prudential Regulations
• Foreign Exchange Manual
Regulatory •
•
Anti-Money Laundering Act
Payment System and Electronic Funds Transfer Act
Framewor •
•
•
Securities and Exchange Commission (SECP)
NAB Ordinance
k
Anti-terrorist Act 1997
• Anti-narcotics Act
• Income Tax Ordinance
• FIA
• FI Ordinance
187
Prudential Regulations
Corporate
/ Consumer SME Branchless
Agriculture
Commercia Banking Banking Banking
l Banking
General
Risk Management Exposure Financing Policy CDD
Regulations
Documentation
Credit Cards
Corporate and Limits Branch Banking
Guarantees
Governance Models
Auto Loans Farm Credit
CDD and Anti-
Loan facilities Risk Management
money laundering Loans for Purchase
Housing Finance
of Machinery
Customer
Classification and Financing for
Operations Personal Loans Protection and
provisioning livestock Awareness
188
Importance of Prudential Regulations
Pakistan banking industry has been growing exceptionally. Resultantly, the
dynamics of banking have been changing. There was a need for guidelines for
banks to limit their exposure, promote good governance, lay a strong
foundation of banking system in the country were a few objectives of
introducing the Prudential Regulations.
Objectives, role and importance:

-In order to promote good governance
-Reduce risk taking
-Supervise the conduct of banks
-To ensure the safety of depositors' funds
-Stability of the financial system
-Creating healthy lending and borrowing culture
-Protection of depositors and share holders’ interest
-Growth of banking sector 189
Common SBP Exceptions at Branches - Cash
• Not maintaining SBP’s Cash Position.
• Fate of Excess / Short Cash was not decided as per the bank’s policy.
• “Sorted” stamps not affixed on reissuable currency notes.
• Cash in vault exceeded insurance limit and excess cash insurance not arranged.
• Small denomination currency notes not accepted by the branch.
• High denomination currency notes not accepted by the branch.
• Fresh currency not issued by the branch at the time of Eid.
• Record of Fresh Currency issuance not maintained.
• Daily balancing of ATM Cash not done.
• Differences in ATM Daily Cash Position not reconciled.
• Customers whose accounts were debited but cash was not disbursed by ATM due to
any reasons, was not timely credited.
• Excess / Short cash in ATM not timely dealt with. 190
Common SBP Exceptions at Branches - Cash (Cont.)
• Proper lightening arrangement and hotline not provided in ATM

areas.
• ATM Retained card log / record not maintained. Cards not timely
submitted to relevant departments and institutions.
• Prize Bond are accepted (where accepted) here not displayed.
• Senior Citizen Counter / Preferred not designated.
191
Common SBP Exceptions at Branches - Account Opening
• Account Opening Documentation as per PR – R1 not

obtained:
• Individual:
• CNIC not obtained.
• In case CNIC does not contain photograph, other valid documents not
obtained.
• In case of salaried person, attested copy of service card or any other
evidence of service not obtained.
• In case of illiterate person, passport size photograph and left and right
thumb impressions not obtained on S.S. Card.
• In case of other individuals, proper source of income not obtained.
(Source of income of husband, in case of wife, Source of income of
Father / Brother / Relative in case of student account, appropriate source
of income, in case of land owners and etc.
192
• Partnership:
• Attested photocopy of CNIC of one of the or all partners not
obtained.
• Attested copy of Partnership Deed not obtained.
• Attested copy of Registration Certificate not obtained (in case of
unregistered, the fact not mentioned on AOF).
• Authority Letter in favour of person operating the account not
obtained.
193
• Joint Stock Companies:

• Board Resolution not obtained.
• Memorandum or/and Article of Association not obtained.
• Certificate of incorporation.
• Certificate of Commencement of Business not obtained.
• Attest photocopy of identity documents of all Board of
Directors.
• Form 29 not obtained.
194
• Clubs, Societies, Associations:

• Certified copies of By Laws or certificate of registration not
obtained.
• Resolution of the governing body authorizing individual(s) to
operate accounts in the branch not obtained.
• An undertaking from all authorized persons that in case of any
changes in authorized personnel, the same will be timely intimated
to the bank.
• Agents Accounts:
• Certified copy of Power of Attorney.
• Attested photocopy of the Agent.
195
• Trust Accounts:
• Attested Photocopy of certificate of registration not obtained.
• Attested photocopy of identity documents not obtained.
• Certified Copy of “investment of trust” not obtained.
• Executors and Administrators:
• Attested photocopy of administrators not obtained.
• Certified copy of letter of administration or probate not obtained.
196
• Government Accounts opened in the name of the personal names of government

employees.
• Special resolution or authority from concerned administrative department not
obtained.
• KYC Form not obtained / not found.
• Serious Discrepancies were noted in Account Opening Documentation and
operations was allowed.
• CNIC was not verified from NADRA before account opening.
• Account Opening Form was missing in the branch or centralized operations.
• Accounts were misclassified at the time of opening.
• Inward Clearing facilities were allowed for photo account holders.
• Letter of thanks not issued to the account holder.
• Miscellaneous irregularities were noted in Zakat Opening forms.
197
Common SBP Exceptions at Branches – Account Maintenance – KYC
• KYC form not obtained / found in record from the customer.

• Unusual and suspicious transactions were allowed in customer’s
account without obtaining and confirming rationale.
• KYC of the customer not maintained where actual turnover exceeded
the agreed turnover with the customer.
• Incorrect information fed in KYC form. Account conduct does not
match the KYC.
198
Common SBP Exceptions at Branches – Account Maintenance
• Dormant account not identified / marked dormant as per the bank’s

approved policies.
• Unclaimed Deposits (Dormant Accounts / Instruments where no
transaction occurred for 10 years) not/wrongly handed over to the SBP.
• Dormant Accounts reactivated without the consent of account holder.
• Half yearly account statements not dispatched / within time.
• Service Charges were recovered from Student, Widow, Pensioner, Semi-
Government and Government Bodies.
• Service charges recovered from dormant accounts.
• Accounts were frozen/blocked without any instruction.
• Zero Accounts closed without any intimation.
199
Common SBP Exceptions at Branches – Cheque book
• Chequebook issued without requisition.

• Chequebook issued to unauthorized personnel.
• Authorized walkin customer / person, not properly verified.
• Stop Payment on cheque(s) was marked without
authorization.
200
Common SBP Exceptions at Branches – Clearing Department
• Cheques returned in Inward clearing without providing (specific)

reason.
• Cheques were sent in clearing / collection without proper scrutiny.
Which resulted in unnecessary delays.
• Cheque Return register not maintained.
201
Common SBP Exceptions at Branches – Locker Maintenance
• Insurance for lockers not obtained.

• Insurance limit for valuables in lockers not communicated to the
customers.
• Inoperative locker holders whose rent was overdue since long, were
not contacted.
• Operation register not maintained.
• Account Opening formalities for locker holders who do not hold an
account in the bank, were not carried out.
• “Lockers Available here” not mentioned.
• Using locker room as cash vault or vouchers.
• Minimum safety guidelines not fulfilled.
202
Common SBP Exceptions at Branches – Remittance
• Instruments were issued on the basis of cash to walk in customers,

without obtaining KYC information / conducting proper due-diligence.
• Due diligence for both local and foreign remittances above the
threshold prescribed in Bank’s Policy, was not obtained.
• Bank effected unauthorized foreign remittance.
• Foreign Remittance not/timely reported to SBP. (Monthly /
Transaction to Transaction basis)
203
Common SBP Exceptions at Branches – Credit
• SME/Commercial/Corporate accounts misclassified.

• Irregularities noted in BBFS, Loan Application Forms and other associated documents.
• CIB not obtained. Irregular defaults in CIB were not investigated.
• Annual Financial Statements not obtained as per the prescribed limit in Prudential
Regulation.
• Clean Credit Facilities above the amount allowed by the PR allowed.
• Exposure of the party exceeded the prescribed limit laid down in PR.
• Stock Reports not / irregularly obtained.
• Correct / e-CIB information not provided to State Bank of Pakistan.
• Conditions mentioned in bank’s own sanction advices, manuals not adhered to.
(Servicing of Mark up, facility type, security type and etc.)
• Expired facilities were renewed with significant delay.
204
Exception Report – Tool for Transaction Monitoring
 What is an exception report?

 Contains transactions deemed irregular or suspicious based on certain
parameters
 What is the usefulness?

 Allows the bank staff to monitor transactions effectively and
efficiently
 All transactions cannot be monitored daily, however, this report
identifies possible unusual activities
205
Exception Report
Banks should have in place a system of generation of exception reports at
branches or at the central office to examine accounts based on certain
threshold limits.
Accounts classified as suspicious:

• Required to be put on enhanced monitoring.
• Accounts should be classified as high risk
206
Branch Internal Control
• Bank’s senior management must ensure that all relevant

regulations are being incorporated in the banks internal
policies.
• Banks internal control policy should be articulated to
staff.
207
7. UBL Specific - Products
208
Customer Journey
UBL Drive
Table of Content
• Dream Car
• Why UBL?
• OUR USP?
• Target Audience
• Features and Options
• Customer Engagement Cycle
• Market Competitors
• Price Offering
• Insurance/Tracker Facilities
• Criteria Setting
• Documentation Required 210

Dream Car
211
Slide No 3
Why “UBL” Should be
“Bank of Choice”
212
Slide No 4
One of the Largest Large Number of Car Top Tracker
Number of Branch Dealers Companies
Network
Segment/Risk based Half Processing Fee on Quicker Turn Around

policies for different Time
segments Repeat Sales
213
Slide No 5
Customers Priority = Hassel Free Process + Fastest Delivery
214
Slide No 6
Target Audience
Salaried Individual Agriculturist
Rental Income
Remittance Customer
215
Slide No 7
Features & Options
Financing also
available in UAE
Financing Available
Both Imported and Local
216
Slide No 8
Customer Engagement Cycle
Customer will
Branch staff will
provide with the
Customer visit the guide the customer
required filled
branch for Auto for application
application form
Loan details solicitation and
along with the set of
required documents
required documents
217
Slide No 10
SPU will make SPU will conduct

Files will be then sure to maintain vigilance against
sent to SPU the file policy checklist
irrespective of and will log
(Sales Processing Unit) decision on the application in the
file system
218
Slide No 11
Complete cases will be EAMVU (External Upon Approval, the CIU

forwarded to Consumer Ops Agency Management
by SPU for DE and then the with assign limit as per
same will be forwarded to Verification Unit) will the policy to the
Credit Initiation Unit (“CIU”) receive the request for customer and update the
and CIU will verify data entry physical verifications LOS. Rejected cases are
through data check, ECIB and forwarded to RRU
Income calculation, DB, and updates the LOS
verisys and sys checks System (Rejection Review Unit)
219
Slide No 12
Upon receiving the down

Sales team will inform the
payment, CIU will verify the
customer about a limit sanction
payment, book the loan on
and equity amount (down
system and payment is
payment, 1st year insurance,
forwarded to respective
etc.)
manufacture or dealer.
220
Slide No 13
Market Scan
Eligibility Criteria HBL Alfalah DIB UBL

Mark Up Fixed 1 year - 18.5% N/A NA ETB - 20%
2-7 years – 19% NTB: 21%
Mark up Floating 16.50% K+ 3.5% – 5% K+4% - 8% ETB: K+6%
NTB: K+7%
Minimum Age 21 years 21 years 21 years 21 years
Financing Limit Upto 5 Mn Upto 6 Mn 100k to 5Mn 250K to 6 Mn
Equity ratio Max 85% 80% 85% Max 80%
Processing Free 7.5k 8k - 8.5k
221
Slide No 15
Price Offerings
SALARIED/SEB/SEP
Criteria Existing (ETB) New To Bank (NTB)
FLOATING RATE
Normal 1 Yr KIBOR + 6% 1 yr KIBOR + 7%
Deviation 1 Yr KIBOR + 8% 1 Yr KIBOR + 9%
FIXED RATE
Tenor 1-3 Yr 4-7 Yr 1-3 Yr 4-7 Yr
Normal 20% 21% 21% 22%
Deviation 21% 22% 22% 23%
222
Slide No 16
Insurance Companies
Security General Insurance 223

Slide No 17
Policy Requirement
Salaried SEB/SEP
Criteria New To Bank Existing
New To Bank (NTB)* Existing (ETB)**
(NTB)* (ETB)**
Age Criteria 21 to 60 Years 22 to 65 Years
Permanent and
Job Status Permanent Only Not Applicable
Contractual both
Monthly Income
Salaried Permanent
Contractual
Employees 35,000 35,000 50,000
Government Staff
Armed Forces
Length Of Employment
Salaried Permanent 12 months 6 Months
Contractual 6 months 3 months
Government 02 Years 01 year
12 months 6 months
Servants
Armed Forces 12 months NA
224
Slide No 18
Policy Requirement
Income Range Debt Burden Ratio (DBR)
Medium Auto (UBL & Industry) 40%
(50k to 75k) Total Aggregate 50%
High Auto (UBL & Industry) 45%
(> Rs 75k) Total Aggregate 50%
Salaried SEB/SEP
Criteria
NTB* ETB** NTB* Existing (ETB)**
New Car (Local): 20%
New Vehicle (imported): 40%
Down Payment
Used car (Local): 25%
Second Vehicle: 5% additional equity
Loan Tenure 1 - 7 Years
Processing Fee Rs 8,500/-, For Used Car: Rs 8,500 + Rs 5,000/- Appraisal Charges
First Car: 5 Million
Financing Limit
Second Car: 6 Million
High Equity Contribution 40% and above equity contribution (not be marked as Deviation)
*Relationship with UBL is less than one year
**Relationship with UBL equal to or more than one year
*** Floating rate is revised annually
225
Slide No 19
Documentation Requirement
Documents Salaried & SEB/SEP
Duly Filled And Signed Application Form
Bank Calculation Sheet

Provided/Sales KFS (Key Fact Statement)
Tool Kit Sign Mis-Match (SMM)Form
Advance Payment Undertaking ( Only for POA Cases)
Registration Retrieval Letter
Copy Of Valid Computerized National Identity Card
1 Year Bank Statement + Bank Letter OR Proprietor Letter OR Business Proof
2 Fresh Passport Size Photo
Collect from
Customer End 3 Latest Salary Slips Required
Current Paid Utility Bill Copy If House No Is Not Available In His Residence Address
Any Other Documents if Required By CIU
Slide No 20
Documentation Requirement
Stage 2 documents
Insurance Certificate
Purchase Order Copy
Spare Key
Copy of Invoice
DAF (Delivery Acceptance Form)
Tracker Certificate
Copy of CNIC
227
Slide No 21
Turn Around Time
Process Estimated TAT

Total Application Process 15 days
EAMVU 3 days
Discrepancy Resolution 5 days
Suspicious cases investigation 5 days additional
228
Slide No 22
• Personal Loan In Action – Pictorial View Table of Content
• Product Summary
• Why you need it?
• Target Market
• Product Feature
• Cost & Other Details
• Approved Regions
• Eligibility Criteria
• Documentation
• Sales Commission Structure
• Process Flow
• Competition Scan 230

Personal Loan in Action – Pictorial View
Product Summary
Introduction:
“From quality education to a grand wedding, whatever
your goal is, UBL CashPlus helps you fulfill your financial
obligations, allowing you to borrow with ease”.
UBL CashPlus is an installment based credit facility which

can be used for multiple reasons listed below:
Child
Wedding Refurbishing
Education
Emergency
Medical
Vacation Situations,
Treatment
etc.
Why you need it?
Target Customer Market
• Existing
• Salaried
CashPlus • All UBL
customer where
customers who
salary disbursed Permanent staff.
have completed
in UBL Account.
1 year of loan.
Existing
Salary Transfer
CashPlus UBL Staff.
Customer.
Customers.
Product Feature
Processing Fee
• UBL CashPlus processing fee will only be applicable on loan approval.
Hassle Free Payment
• Customer installment will be auto debit from his salary account. Which
reduces the risk of getting late payment charges and enable customer to
maintain clean history.
Life insurance
• Complementary Life insurance is also provided to the UBL CashPlus

customers. (If in case of customer death his/her family is not liable to pay the
outstanding loan amount)
235
Key Product Structures
Everything you need to know to sell your Product
• Perform number of
• Pay back in easy banking transactions
• Efficient and quick • Fixed rate for the
monthly installments over the phone and get
turnaround time to customer to avoid any personalized service for
ranging from 1 years to meet your needs and extra or hidden
5 years. anything you need to
expectations. charges. know about UBL
products and services
24 Hours
Customer Fast & Quick Affordable
Customer
Convenience Processing Pricing
Services
Cost & Other Details
Loan Type Need Based Unsecured Loan
Processing Fees PKR 3,500 + FED or 1% of the loan amount (whichever is higher)
Markup Fixed 31%
Auto-Debit Facility Available
Life Insurance Available (Complementary)
Re-Payment Option Equal Monthly Installment
Late Fee PKR 1,000/- + FED (will be recovered from the next Month’s Installment)
Partial Payoff option

5% of the amount being reduced from outstanding principal
Fee
Early Settlement Facility 5% of outstanding principle loan amount
Turn Around Time 10 Business Days (Subject to no discrepancy)

237
Approved Regions
Permanent Salaried individuals / Govt. Employees / Armed Forces Male or Female
whose salaries are being credited in UBL can avail UBL CashPlus.
UBL is offering its CashPlus facility across Pakistan in following Clusters / Regions:
North Central North Central South South
• Islamabad • Lahore East • Multan • Karachi

• Rawalpindi • Lahore • Sahiwal South
• Mardan West • Bahawalpur • Karachi
• Peshawar • Sargodha North
• Azad • Gujranwala • Hyderabad
Kashmir • Sialkot • Sukkur
(Mirpur) • Faisalabad
• Jhelum
238
Eligibility Criteria
Parameters Criteria
Age Criteria 21 to 60 Years
Employment Status Permanent Staff Having Salary Relationship With UBL
Listed Companies / Govt. Servants /

Armed Forces
PKR 20,000/- (Internal Salary Transferred into UBL, CASH Salary
Monthly Net Income
Un-Approved Companies Not Acceptable)
UBL Staff
Listed Companies / Govt. Servants /
Armed Forces
Length of Employment 12 Months (Including Existing Employment)
Un-Approved Companies
UBL Staff
Single Unsecured 25%-40%
DBR
Aggregate Unsecured 30%-45%
* CashPlus policy Not Applicable on SEB / SEP

Documentation
SPU & Sales Checklist
SPU & Underwriting Checklist
Letter Of Undertaking (CF-1)
Bank Undertaking From Employer (only on non-approved)
Provided/Sales
Tool Kit SMM (Sign Mismatch) Form
Schedule Of Charges (SOC)
Key Product Fact Sheet (Summary Box)
Legal Document (LD)
Auto Debit Form
Last 06 months Bank Statement
Collect from 1 Current Salary Slip
Customer End (*3 Latest Salary Slips Required If Variance In Salary)
Current Paid Utility Bill Copy If House # is not available in his residence address
Any Other Documents Required By CU
Sales Commission Structure
The following commission structure is proposed for UBL CashPlus
based on industry comp scan:.
Monthly Booking Volume Commission Percentage
Up to Rs 499,999 0.25%
500,000 to 999,999 0.38%
1 Mn to Rs 2.99 Mn 0.55%
.
3 Mn to 4.99 Mn 0.80%
5.00 Mn and above 1.00%
Processing Officer will get Rs 50 on each booked cased

Processing officer will get Rs 100 on be ach booked case, if case
processed as clean
241
Process Flow
Customer will provide

Branch staff will guide
Customer visit the with the required filled
the customer for
branch for product application form along
application solicitation
details with the set of required
and required documents
documents
242
Process Flow
SPU will extract details &

conduct vigilance against COPS will receive
policy checklist and forward applications and DE Officer
Files will be then sent to SPU applications to Consumer will capture application in
Operations for Data Entry. LOS.
243
Process Flow
Complete cases will be

forwarded to Consumer
Underwriting (“CU”) and they EMAVU will forward physical Upon Approval, the CU with
will verify data entry through verifications (if any as per assign limit as per the policy to
application. Also check data policy) and updates the LOS the customer. Discrepant cases
check, ECIB and Income System will be forwarded to RRU.
calculation, DB, verisys and sys
checks
244
Process Flow
After disbursement of the loan

RRU will contact customer or
on symbols COPS will print
sales to resolve discrepancies
welcome letter and repayment
in 5 working days (maximum).
schedule.
245
Competition Scan
Features
Charged on PKR 3,000/- or 1%

Processing Fees PKR 3,000/- PKR 2,500/- PKR 5,000/-
approvals only whichever is higher
Markup Rate 27% 29.99% 29% 27 - 36% 28.88%

PKR 25,000/-
PKR 25,000/- PKR 30,000/-
(salaried)
(salaried) (salaried)
PKR 20,000/- PKR 12,000/-
Income Criteria (salaried credit in (salaried credit in
UBL only) HBL only) PKR 50,000/- (self- PKR 50,000/- (self-
No for Self-
employed/businessma employed/businessma
Employee
n) n)
Loan Duration 1 - 5 Yrs. 1 - 5 Yrs. 1 - 5 Yrs. 1 - 5 Yrs. 1 - 5 Yrs.
PKR 25,000/- to 2 PKR 30,000/- to 2 PKR 50,000/- to 2

Limit PKR 2 Mln PKR 2 Mln
Mln Mln Mln
Age 21- 60 Yrs. 21 – 61 Yrs. 21 – 60 Yrs. 21 – 60 Yrs. 21 – 65 Yrs.

UBL Assure Finance
247
Table of Content
• Secure Your Car
• Product Feature
• Target Market
• Coverage Under Insurance
• What’s In It For You
• Who can Apply & Other Details
• Documents
• Process Flow
• Sample Calculator
248
Unique Preposition
Product Feature
• Personal Loan offering for customers at 0% markup. Variant of current Personal Loan product.
0% Mark-up
rate
• Auto Loan insurance premium for customers will be funded by the bank – enabling our customers to pay the total auto insurance
10 monthly amount in equal 10 monthly installments
instalments
• The insurance company (UBL insurer) will in return provide protection i.e. underwrite the risk, set-off claims and principle
Protection protection through the unearned portion of the insurance premium at all times.
for Vehicle
• The product will be offered to all existing and new to bank UBL customers.
All UBL
Customers
• First of its kind Personal Loan in the Pakistan market (Progressive and Innovative)
Personal
Loan
250
We Can Secure Your Car
251
Target Market
Cars currently
uninsured due to New cars sold on
premium un- cash.
affordability.
Cars completing
Used cars sold on
their financing and
cash
leased tenor
Cars owned by
corporate Cars owned by UBL
employees Staff
252
Coverage Under Insurance
Theft
Own Damage
Partial Loss
Third party
liability
Total loss due

to accident
253
What’s In It For You
Assure Finance
First of its Offered to all
Personal 10 equal
kind Personal type of
Loan offering installment 10% Down Faster
Loan in the customers
at 0% for insurance payment Processing
Pakistan i.e. Salaried
markup. premium
market & SEB/SEP
254
Who Can Apply
Particulars Details
Min Monthly Income PKR. 15,000
Salaried – Currently in Job

Length of Employment Self Employed – 12 months in business tenor
Self Employed : Income and Telephonic Verification of office.

Verification Salaried : Income (where salary credit b/st not verified) and
Telephonic Verification of office.
Debt Burden 50%

COST & OTHER
DETAILS
Processing Fee Rs 1,500 + FED
Tenure 10 months
Min & Max Financing 5,000 to 150,000
Late Fee Rs 500 + FED
Down Payment 10% of the premium amount
255
Insurance Rate 3.75% (Above 900 CC) & 4.75% (Below 900 CC)
Documentation

SPU & Sales Checklist
Bank SPU & Underwriting Checklist
Provided/Sales SMM (Sign Mismatch) Form
Tool Kit
Schedule Of Charges (SOC)
Key Product Fact Sheet (Summary Box)
Legal Document (LD)
Income Documents -> Salaried
• Salary Slip / Salary Certificate
Collect from • Bank Statement (where salary is being credited)
Customer End Income Documents -> Self Employed - SEB/SEP
• Current one year bank statement in personal or business name
Current Paid Utility Bill Copy If House # is not available in his residence address
Any Other Documents Required By CU
Process Flow
Customer will
Branch staff will
provide with the
Customer visit the guide the customer
required filled
branch for product for application
application form
details solicitation and
along with the set of
required documents
required documents
257
Process Flow
SPU will extract details

& conduct vigilance
against policy checklist COPS will receive
Files will be then sent to and forward applications applications and DE
SPU to Consumer Operations Officer will capture
for Data Entry. application in LOS.
258
Process Flow
Complete cases will be

forwarded to Consumer EMAVU will forward Upon Approval, the CU
Underwriting (“CU”) and physical verifications with assign limit as per
they will verify data entry the policy to the
through application. Also (if any as per policy) customer. Discrepant
check data check, ECIB and updates the LOS cases will be forwarded
and Income calculation, System to RRU.
DB, verisys and sys checks
259
Process Flow
After disbursement of RRU will contact

the loan on symbols customer or sales to
COPS will print resolve discrepancies in
welcome letter and 5 working days
repayment schedule. (maximum).
260
Car Make Honda
Car Model Civic
Assure Finance Calculator

Manufacture Year
Horse Power
Sample Calculator
2016
1300 CC
Car Price Rs 1,300,000
Vehicle Details
Car Make Honda
Car Model Civic
Manufacture Year 2016 Insurance Rate% 4.25%
Horse Power 1300 CC Insurance Amount Rs 55,250
Car Price Rs 1,300,000 Down Payment Rs 5,525
Finance Amount Rs 49,725
Insurance Details Monthly Installment Rs 4,972.5
Insurance Rate% 4.25%
Insurance Amount Rs 55,250
Down Payment Rs 5,525 Tentative Repayment Schedule
Finance Amount Rs 49,725 Installment Amount Outstanding Balance
Monthly Installment Rs 4,972.5
Finance Amount Rs 49,725
1st Month Rs 4,972.5 Rs 44,753
Installment Amount Outstanding Balance 2nd Month Rs 4,972.5 Rs 39,780
3rd Month Rs 4,972.5 Rs 34,808
4th Month Rs 4,972.5 Rs 29,835
5th Month Rs 4,972.5 Rs 24,863
6th Month Rs 4,972.5 Rs 19,890
7th Month Rs 4,972.5 Rs 14,918
8th Month Rs 4,972.5 Rs 9,945
9th Month Rs 4,972.5 Rs 4,973
10th Month Rs 4,972.5 Rs 0 261
Credit Cards
262
Content
• Vision & Mission
• Background
• Credit Card Life Cycle
• Product Bifurcation
• Credit Card Eligibility Criteria
• Spending Reward points
• Value Added Features
• LIP Portfolio
• SOC Jul – Dec 2019
• FAQs
263
Vision & Mission
UBL Credit Cards
• Vision
To lead the future of plastic Money in Pakistan
• Mission Statement
Aspire to possess because of Chip, Value for Money, Product Innovation,

Comfort, Convenience and Status Symbol, hence leading the future of plastic
money in Pakistan
264
Background
UBL Credit Cards
• First EMV Chip Credit Card in Pakistan

• Launched in 2005
• Around 80,000 cards in force
• Partnered with VISA
• Card Variants: Silver - Gold –Platinum
• Unique Reward Options - Road miles – Classic Rewards –Airmiles (Only for
Platinum customers)
265
Credit Card Life Cycle
Card
Acquisition
/ Renewal
Card
Revolve 90-120 days to get Delivery
first spend on Credit
Card post booking
Card
Spend
Activation
266
266
Product Bifurcation
Card Products
267
Platinum Credit Card
UBL Platinum Credit Card
• Privileges beyond Silver/Gold VISA Credit Cards

• Top tier product
• Target Market -high end customers
• Higher credit limit – (PKR 450K-PKR 2 million)
• Services unmatched Triple Rewards
• Free access to Shapes Health Club
• Visa Offers
• Air miles Rewards (redemption for free Air Ticket)
• Priority Pass
• Free Accidental Insurance
• Free CIP & UBL lounge access
268
Classic Credit Card
Classic Credit Card
• Pakistan’s First Chip Credit Card

• Card Limit (Silver: 10,000 – 124,999 / Gold 125,000 - 399,999)
• Guaranteeing : Enjoyment - High value
• Around 80,000 cards in the market
• VISA -Global acceptability:

-More than 22 million establishments worldwide in 130 countries .
-More than 12, 000 outlets within Pakistan.
• CHIP based Credit Cards

-Most secure way of conducting credit card transactions
-High tech CHIP guarantees Security
269
PSO Credit Card
UBL PSO Credit Card
• 5% fuel back on transactions at PSO stations
• 1% fuel back on transactions at non PSO outlets
• Annual Fee Waiver on spend for silver and gold cards
• Free Accidental insurance
270
Galleria Credit Card
UBL Galleria Credit Cards
• Launched in May 2007
• First Chip picture card of South Asia
• Pakistan’s first picture credit card
271
Eligibility Criteria - Salaried Individuals / Card Limits
Basic Criteria UBL HBL SCB BAFL FBL
Tier I: KHI, Lhr, Isb/Rwp
All cities except Quetta
Tier II: FSD, Guj, Slk, Mtn All cities where Tier I & Tier II
Allowed Cities region & few cities of
Tier III: Grt, Bhwl, MAK, Psh,
Tier I Cities
branches exists Cities
KPK
Hyd
Silver 10k - 124k 20k - 149k 25K-149K 25k - 124k 25k - 124k
Gold 125k - 399k 150k - 499k 150K-299K 125k - 499k 125k - 499k
Credit Limit Platinum 400k + 500k + 300k + 400k + 400k +
Titanium N/A N/A 150k - 125k - 2000k 125k - 2000k

Age Limit 21 - 60 21 - 60 21 - 60 21 - 60 21-65
Minimum Income Rs.20K Rs. 15K Rs. 50K Rs. 25K Rs. 30K
Unsecured DBR 20% 30% 8-12 multiples 45% -
Debt Burden DBR 50% 50% 50% 50% 50%
Salaried Length of Current 3 months 1 months N/A 3 months N/A
employment
Total 12 months N/A 6 months 12 months 6 months
NTB Mandatory Mandatory Mandatory Mandatory Mandatory
Physical
Verifications Existing Mandatory No / RC waiver Case to Case Basis No No
272
272
Eligibility Criteria – Self Employed Individuals
Basic Criteria UBL HBL SCB BAFL FBL
Age Limit 21 - 65 21 - 65 21 - 65 21 - 70 21-65
Minimum Income Rs. 100K Rs. 25K Rs. 70K Rs. 50K Rs. 30K
Unsecured DBR 20% 30% 8-12 multiples 45% -
Debt Burden DBR 50% 50% 50% 50% 50%
Length of Current 12 months N/A N/A N/A N/A

Business 12 months SEP
Total 24 months 24 months 24 months 12 months
24 months SEB
Self
NTB Mandatory Mandatory Mandatory Mandatory Mandatory
Employed Physical
Verifications Existing Mandatory No / RC waiver Case to Case Basis No No
Sum of credit
3 highest and 3 3 highest and 3 3 highest and 3
Income Calculation transactions in last 12 3 highest and 3 lowest
lowest balances in lowest balances in lowest balances in
Method months with industry balances in last 6 months
last 6 months last 6 months last 6 months
margins
Dips Allowed 3 3 3 3 3
Tenure 36 months 6 months 6 months 6 months 6 months

Bank
Statement Allowed Allowed Allowed Allowed Allowed
Personal
273
273
Reward Programs
Points Worth in Reward Redemption Redemption
Rewards Program Points Accumulation
Earned Rupees Catalogue Option Request
Classic Rewards 1 point for Rs. 50/- 100 30 No Cash Back Call Center
Slab Wise
Road Miles Starting From 5k spend
100 100 No Cash Back & PSO Call Center & PSO
UBL 5% PSO outlets & 250 250
PSO Auto Cards 1% Non PSO outlets 50 50
No Cash Back & PSO Call Center & PSO
Local: 1 point for Rs. 50/- 100 30

Airmiles Int’l: 3 points for Rs. 50/- 300 90 No Against Air Travel Call Center
Normal Rewards 1 point for Rs. 25/- 200 50 Yes Catalogue & Vouchers Call Center
Cash back 3% Green 150 150
HBL Fuel Card Rewards Cash back 6% Gold 300 300 No Cash Back Auto adjusted in Bill
Local: 1 point for Rs. 25/- 200 50

Airmiles Int’l: 5 points for Rs. 25/- 1000 250
Yes Catalogue & Vouchers Call Center
Local: 1 point for Rs. 125/- 40
Platinum Card Int’l: 2 points for Rs. 125/- 80 Variable No Emirates Website Ticket purchase at
(Emirates) Emirates Local: 2 point for Rs. 125/- 80 Emirates
SCB Emirates Int’l: 4 points for Rs. 125/- 160
Local: 1 point for Rs. 100/- 50
Platinum Card Int’l: 2 points for Rs. 100/- 100
Variable No Emirates Website
Ticket purchase at
(Emirates Infinite) Emirates Local: 2 point for Rs. 100/- 100 Emirates
Emirates Int’l: 4 points for Rs. 100/- 200
BAFL Orbit Rewards 1 point for Rs. 200/- (Local) 25 75 Yes Catalogue & Vouchers Call Center/E-Banking
1 point for Rs. 200/- (Int’l) 50 150
274
Credit Card Reward Points - Yayvo
UBL introduced a new and exciting reward scheme with TCS Yayvo to boost our brand image and customer loyalty.
UBL Credit card customers now have the unique option to redeem their reward points to purchase products in full or partially through TCS Yayvo offers a wide
range of discounted deals on Apparels, Electronics, Home Supplies, Computing, Fitness, Books, Grocery and much more .
 This reward scheme is applicable on all UBL Credit Cards.

 Points can be redeemed from any reward profile i.e. Classic, Airmiles, PSO
Road miles & PSO Auto
 This only applies to purchases made from yayvo website with UBL Credit
Cards only.
 Customer should be advised to redeem points after 7 days as after this
customer cannot return product.
275
275
Value Added Features
• Credit Guardian
• Balance Transfer
• Utility Bill Payment Service
• Free CIP Lounge Access(only for Gold cards)
• Free fuel & Accidental Insurance
• Cash Advance
• Cash on Phone
• Direct Debit Facility
• Net Banking
• Lite Installment Plan
• 24 x 7 Contact Center (111-825-888)
276
UBL LIP Portfolio
277
277
UBL LIP Program
278
278
UBL Other Promotions
279
279
Credit Card – SOC (Jul – Dec 2019)
280
Credit Cards - FAQs
• How do I activate my card?

Upon receiving your card, kindly call up our Call Center at 111-825-888 to get your card activated. Once that is
done you can start using your card instantly.
• Where can I use my UBL Credit Card?
UBL Credit Card is accepted wherever the Visa logo is displayed at over 29 million locations in 210 countries
around the world along with 50,000 merchants in Pakistan.
• How would I know the amount that I have to pay?
Every month you will receive your credit card statement mentioning the total outstanding payable. Don't forget
to check the following heads:
– Current Balance
– Minimum Payment Amount
– Payment Due Date
– In addition, you can call UBL Contact Centre at 111-825-888 to enquire about your outstanding balance
payable.
• What if I pay the Minimum Payment Amount or any amount less than the full amount
(current balance)?
A Service Fee as per the prevailing Schedule of Charges will be levied if you pay the Minimum Payment Amount
or any amount less than the full payment but more than or equal to the minimum payment by the payment
due date. For retail transactions which can be covered by the payment, Service Fee is charged from the
transaction date to the payment posting date. On retail transactions which are not covered by the payment,
Service Fee is charged from the transaction date to the date the next Statement of Account is generated.
281
Credit Cards - FAQs
• What if, for any reason, I do not pay the Minimum Payment Amount or the Current
Balance by the Payment Due Date?
Service Fee will be charged as per the prevailing Schedule of Charges on each retail transaction from the
transaction date to the statement generation date. Late Fee will be charged as per the prevailing
Schedule of Charges. Your credit card account will be blocked effective next statement date if minimum
payment is not received.
• What if I make full payment?
For all retail transactions, if full payment is received within the payment due date then no Service Fee is
charged.
• Can I use my UBL Credit Card for Internet shopping?
Yes you can use your credit card for online shopping. Only for online VBV merchants you need to activate your
VBV services by calling UBL Contact Center at 111-825-888.
• How should I handle a change in my address?
You can inform us of your new mailing address by simply calling UBL Contact Center at 111-825-888. You can
also request for the change by sending a written request to the UBL Card Center.
UBL Card Center 2nd Floor, UBL Warehouse Building, Plot # 1 & 2 "C" Group, Mai Kolachi Road, Karachi -
Pakistan.
• What should I do if I encounter problems with my card account?
If at any time you face any problem regarding your card account, call our 24-hour UBL Contact Center at 111-
825-888 for immediate assistance. You can direct your written queries to the following address:
UBL Card Center 2nd Floor, UBL Warehouse Building, Plot # 1 & 2 "C" Group, Mai Kolachi Road, Karachi -
Pakistan.
282
Credit Cards - FAQs
• How do I get my limit enhanced?

You can apply for a limit enhancement on your credit card. Send a written request or filled out Limit Enhancement Request
available on our website along with your income documents (bank statement / salary slip / salary certificate) and CNIC copy to
the following address:
UBL Card Center 2nd Floor, UBL Warehouse Building, Plot # 1 & 2 "C" Group, Mai Kolachi Road, Karachi - Pakistan
UBL reserves the right to approve/reject your credit enhancement.
• What is an Over Limit Fee?

Your expenditure on your credit card must remain within the credit limit assigned to you. In case you exceed
your credit limit, an Over Limit Fee as per the prevailing Schedule of Charges will be charged each time you
exceed your credit limit.
• How do I know my credit limit?
Your credit limit appears on your monthly credit card billing statement which also states your current
outstanding balance and remaining available limit. In addition, you can call UBL Contact Centre at 111-825-
888 to enquire about your Credit Limit.
• How do I know my cash withdrawal limit?
Your Cash Withdrawal limit appears on your monthly credit card billing statement. In addition, you can call
UBL Contact Centre at 111-825-888 to enquire about your Credit Limit.
• How much is my available credit limit?
You can call UBL Contact Centre at 111-825-888 to enquire about your Available Credit Limit.
• How much is my available cash limit?
You can call UBL Contact Centre at 111-825-888 to enquire about your Available Cash Limit. 283
Credit Cards - FAQs
• Do I have to clear my entire outstanding balance at the end of each month?

You have the option of paying the entire availed amount or paying as low as 5% of your outstanding balance
or PKR 200/, whichever is higher.
• How can I make payments if I am abroad?
If you are outside Pakistan, we recommend that you make a telegraphic transfer (charges applicable as per
the Schedule of Charges) through a local bank in Pakistani Rupees. You may also take advantage of the Auto
Debit facility, which would be a safer and faster way of making payments towards your UBL Credit Card.
• How many Visits are Free on UBL Platinum Credit Card for Primary & Supplementary
Card Member
Total number of free visits in a month would be 8 for both Primary & Supplementary combined.
The charges (Rs.1,200/-) would be applicable from the 9th visit onwards in a month if the total spending is
less than Rs.50,000 in a month.
If the combined account level spending is Rs.50,000 or more than 8 additional visits would be given free.
After that every extra visit will be charged accordingly.
284
UBL DIGITAL BANKING
BETTER | FASTER | EASIER
28
5
WE LIVE IN AN
ATTENTION ECONOMY
Why the need for digital transformation?
Banks across the globe are increasingly adopting digital Digital impacts an organization in numerous ways
strategies to transform channels, products, processes
and back end systems to:
Emerging
technologies
• Remain relevant in the market
• Achieve higher level of
customer experience
• Acquire new segments

• Lower cost base New
New
channels for
business Organization
sales &
models
marketing
• Attain internal operating
efficiency - Better, Faster & Easier
• Be anytime and any where
New ways of
working
The real impact of digital innovation is in transforming people, creating a new kind of user –
“the connected consumer”; we need to rethink the way we conduct our business to understand
and meet their evolving needs.
28 287
7 Source: Based on in depth analysis of 32 global case studies, research papers by Big 4 consulting firms & IBM study.
Changing Global Trends
New tech-enabled innovations have major implications for the The global banking industry continues to invest in front end digital
financial services and payments industry in mature and developing capabilities, as well as data and analytics to engage and convert
countries. customers.
Top 6 global trends affecting banking Top 3 banking investment areas in 2017
Gen Z Rising:
Customers, especially younger generation, are increasingly
relying on technology to manage their daily lives. Visiting a bank
branch is incomprehensible.
Customer journeys /
Mobile First:
Globally, customers are looking to handle banking functions
54% experience
transformation
online and on mobile, whenever and wherever they are.
User Experience:
Banks that deliver excellent digital experiences are retaining
their current customers and attracting new business
opportunities.
Fintech & Bank Fusion:
Banks have infrastructure, industry knowledge, brand reputation
Using big data,
advanced analytics & 53%
& customer bases. Fintechs contribute expertise in disruptive cognitive computing
technologies and the agility to innovate. Successful partnerships
are winning!
Payment Everywhere:
Increasingly mobile is being used to accept & make payments. 9
out of 10 purchases made in a record $25B Single Day sales
recently by Ali Baba were on mobile.
45%
Network Effect:
Collaboration is bigger and bolder than ever before. Between
Improving multi-
banks, with technology partners and payment schemes; a new channel delivery
eco-system is being created.
288 28
Source: “Consumer Payments Pulse Survey”, Accenture; “The Digital Transformation of customer services”, Deloitte; “The Financial Brand”
8
Millennials Vs. GEN Z
Millennials GEN Z
Born: 1981-1996 Born: 1997-2006

Face2Face Public Digital Only Private
Age: 19-34 Age: 10-18
Tech savvy
Tech savvy Formal On-Demand
Independent Collaborative 5 screens at
2 screens a day Education Learning
once
Communicate
Communication Optimistic with Pictures & Job Hopping
Realistic Role Hopping
with text Videos
5
Three approaches being followed for the transformation journey
Old Architecture
Front end only Wrap & Digitalize Go digital native

New Architecture
Front end
Integration
Core Processing
Low Level of Transformation High
A hybrid approach is to fix the A radical approach is to

The simplest is to front end while gradually replacing “go digital native,”
digitize the front end only.legacy infrastructure and creating a fully digital
integrating the middle and back bank from the ground up.
office.
290
Source: “Bank to the future”, pwc
29
1
Mashreq Bank
Mashreq Bank has repositioned itself as a new full-service digital bank, to cater to the day-to-day financial
needs of a world on the move.
 Business Architecture: Neo is a full-service digital bank with a strong suite of Retail Banking products, designed with an aim to embed
banking into the daily life of customers without pursuing them to visit bank’s branches. Neo has stood out with its intuitive and personalized
user interface that will transform daily banking transactions experience for the fast-evolving customers.
 Value: Mashreq Neo enables customers to open an account instantly via the mobile App or Web Site, receive debit or credit card and cheque
book within 24 hours. With the advent of new technology solutions for payments, Mashreq Neo offers the most comprehensive set of payment
capabilities, including Samsung Pay wallet, International bill payment to over 100 countries, Cardless cash from ATMs, Mobile-to-Mobile
transfers, remittances, trading of stocks and gold locally and globally.
 How it transformed the business: With the launch of Neo, Mashreq Bank has entered a
new era in the digitization of retail banking with an aim to provide seamless, convenient,
secured and cost effective banking services, compared to traditional branch banking. The
platform is scalable and flexible to add more exciting features and cutting edge digital
technologies making Mashreq be the best way to bank with.
 Outcome: Neo, being the first digital bank in the GCC region, has enabled Mashreq Bank
to continue focusing on providing innovative products and services in order to meet the
evolving demands of next generation customers and maintain its leadership position in the
market.
 Differentiating Factors: Intuitive and personalized design. Instant account opening,

Innovative payment solutions (Mashreq Pay Wallet, NFC and Plastic Cards). Cross border
Remittance and Trading options. Rewards setting as per customer’s lifestyle.
 Key Takeaways for UBL: ‘Mobile First’ strategy, Independent and dedicated setup.
292
Population Landscape - Pakistan
Eligible: 0.6M (0.5%)

• Banked: 0.48
Privileged
• Other formal: 0.02
Total Population: 207M (Upper)
• Excluded: 0.10
• Rural: 64 % - Urban: 36% Eligible: 7.3M (6%)
Elite Mid
• Male: 51 % - Female: 49% dle
(Upper
• Banked: 5.0
Middle)
• Excluded: 1.8
Eligble for Banking (CNIC Holders) Eligible: 5.2M (3.5%)
Hard-C • Banked: 3.1
• Banked: 22M (18%) Middle ore • Other formal: 0.4
(Mid
• Other Formal: 15M (12%) Middle dle
)
• Excluded: 1.7
• Excluded: 85M (70%) Eligible: 10.3M (9%)
Fledgi • Banked: 4.1
Total: 122M ng Middle • Other formal: 1.1
Class • Excluded: 5.1
(Lowe
r Midd
le) Eligible: 19.2M (16%)
• SIMs Issued: 143M
• Banked: 4.8
• Smart Phones: 103M • Other formal: 1.9
Climbe
• 3G / 4G SIMs: 49M (Upper rs • Excluded: 12.5
Lower) Eligible: 28.0M (23%)
• Banked: 2.8
Aspira
nts • Excluded: 21.8
(Midd
le Eligible: 51.0M (42%)
Lower
)
• Banked: 1.5
Vulner • Excluded: 42.3
able
(Lower
Lower)
9
Source: SBP, PBS, PTA and PIDE (Socio Economic Category is based on Purchasing Power Parity)
UBL is uniquely positioned to cater for all the 7 distinct customer segments
Our competition today

Our Competition – Different at Every Front
Privileged Class
Privileged
(Upper)
Elite Mid
(Upper dle
Middle)
Middle Class
24M
Hard-C eligible population
ore Middle
(Middle (53% banked)
Middle
)
Fledgin
g Mid
dle C
(Lowe
r Midd lass
le)
122M
Climbers eligible population
Climbe (3% digital
(Upper rs
Lower) penetration)
98M
Aspira eligible population
(M nts
iddle L (9% banked)
ower)
Vulnerable & Aspirants

Vulner
able
(Lower
Lower)
Eligible Population = Unique CNIC holders
294
Source: SBP, PBS, PTA and PIDE (Customer segmentation is based on Purchasing Power Parity)
We must take a focused approach to identify the opportunities that deliver the greatest impact
to current and future customers
Evaluation of key digital opportunities
Next Three Top Four
Potential Opportunities for
Opportunities UBL Digital
R2 R4
R1
5 R12
R8 R6 R7
R10
Value to Customer
4
R11 R5
R9
3
R3
R13
2 3 4 5
Value for the Bank (Opportunity Size & Ease of Implementation)
R1 Self Service on-boarding R6 Informed Lending R11 Partnerships with high foot-traffi c to increase reach
R2 Payment Network R7 Targeted Saving Schemes R12 Offer POS/Acquiring services to retail businesses
R3 Next Generation Retail Branch R8 Open Platform for Micro-lending R13 Cross sell non-banking products
R4 Digital Wallets R9 Wealth Management
R5 Capturing Remittance R10 Loyalty Programs
295
Three categories have been identified as top priority for us based on value to customer, size
of opportunity & ease of implementation
Top opportunities
 Set of omnichannel products and services that provide consistent experiences across both physical and
digital banking channels and allow customers the flexibility to bank when, where, and how they so choose
according to their own personal needs.
 Size of opportunity: Increasing the existing customer base by 16M (including 14M wallets) in 5 years by
Self service digital focusing on customer self on-boarding, enabling self service of basic day to day banking needs through
banking automation improving overall experience & freeing up bank’s staff time for more complex tasks. A
(Acquisition /
Onboarding) potential revenue up side of Rs 13B over the next 5 years.
 Complete suite of digital payments to allow customers to initiate or receive payments without recourse
to the bank branch and enable tech based evolving solutions on multiple devices as per customer’s needs.
 Size of opportunity: Reducing the weighted average cost per transaction from Rs 56 in 2017 to Rs 45 in
Payments 2020 by focusing on P2P, P2B and P2G payment streams contributing to a potential cost saving of Rs
2.8B p.a in 3 years time.
 Real time, self serve, multi channel care that provides transparent and simple ways of interacting with
the bank at customer’s own convenience & at his own device. Focusing on loyalty management for the
customer improving stickiness as well as attracting new because of differentiated offering.
 Size of opportunity: Reducing the current customer attrition rate of 25% down to 14% by 2022 retaining
Customer Care over half a million satisfied customers giving a potential revenue up side of Rs 1.3B & a cost save in the
(Loyalty)
form of reduction in contact center agents by 30%.
296
UBL Omni – Strategy 2019
Optimize Costs
Q2 2019 – Q4 2019
Drive Account
Usage
Q4 2018 – Q4 2019
Focus on KPIs &

Gain Market
Share
2018-2019
Achieve Scale
2018-2019
297 29
7
Our digital channels strategy – Cost efficient Omni channel experience
298
YTD Digital Roadmaps Status (2018)
Done In Progress Customer Self-Care Digital On Boarding Payments
DOB: restrict launch location Signup: call back to

& email mandatory correct email & cell
Signup with Secret DOB: Tablet

Signup on iOS Beta Live Hybrid 2FA - SBP Code Initiated
Feb Mar Apr May Jun Jul Aug Sep
2018 2018
Face ID on iPhoneX Tablet Auto populate Digital Secure AOF
Tax Payment Digital on
App
School fee (Beacon House Pay to CNIC
and City) on Digital App
UX/UI Improvements
Digital App Analytics engine & Notification Centre
299
Digital Key Performance Indicators (2018)
Digital
KPI 2017 2018 Growth
Digital Penetration (Net-Banking & App)
Total Registered Customers 390,000 487,645 25%
Total Active Customers (1 login in 30 Days) 73,000 174,288 139%
Total Transacting Customers (1 transaction in 30 Days) 41,400 107,624 160%
Transactions (App & Netbanking)
Utility Bills (Volume Million) 0.45 0.71 58%
Mobile Vouchers + Topup (Volume Million) 0.58 1.36 134%
IBFT (Volume Million) 0.71 1.37 93%
Tablet On-boarding (No of Accounts) 13,307 70,102 426.8%
Omni
KPI 2017 2018 Growth
Active Agents 17,579 22,000 25%
Transaction Throughput
Domestic Remittance (Value Billion) 23 31 33%
Utility Bill Payment (Volume Million) 27.1 36 34%
IBFT (Value Billion) 2.1 6 205%
FT to UBL (Value Billion) 1.6 5 194%
Market Share
Domestic Remittance 15% 16% 1%
Utility Bill Payment 21% 26% 5%
Cash Management 38% 40% 2%
Agents 9% 10% 1%
Accounts 9% 8% -1%
300
UBL DIGITAL BANKING
BETTER | FASTER | EASIER
30
1
Project Kickoff - London Studio – May ‘17
302
We visited the Dubai studio
303
We Identified the Space
304
Which we’re designing with a local architect
305
Development of UBL’s Digital Studio, “Level 3”, has been initiated
306
Development of Digital Lab
307
Inauguration and Go Live of UBL Digital Lab – December’2017
308
Design Thinking Workshops
2309 30
9
31
0
Operating Model
Empathize Ideate
Define Prototype
Test
26 31
1
Build experiences incrementally and get to market quickly
Hybrid Hybrid + Digital

Digital + assisted Multichannel Full self service
27 31
2
Our transformation framework
Onboarding
JOURNEYS
Employee banking
Marketing
ENVISIONING
Capabilities
28 31
3
Reinventing Onboarding
It starts with
customer research – Jun’17

314
Reinventing Onboarding
10 30+branch visits
days
70+customer interviews
3,000 50+staff interviews
km
5competitor interviews
315
Digital Account Opening
31 31
6
UBL SE Products
317
Key Features Description
Product Business Mortgage Finance (Karobar Loan)
Eligibility criteria • Experience: 3 Years in respective business
• Age 21-65 Years (for Sole Proprietor)
Financing amount PKR 30 Mn or as defined in SME SBP PR whichever is less
Mark-up KIBOR + spread
Collateral • Mortgage of residential / commercial / industrial
property. 3rd party collateral is also acceptable
Loan Tenor • Running Finance: Revolving line
• Term Finance: Max 5 to 8 Years
Main Features Type of Credit Facilities: Running Finance / Term Finance
Letter of Credit / Letter of Guarantee / Export Refinance
(Part-I & Part-II) / Import related facilities (FIM, FTR)
Type of Entities:
• SME - Proprietor / Partnership / Limited Companies
Product Commercial Vehicle Financing for Business segment (LCV)
Financing amount New Vehicle: PKR 5 Mn
Used Vehicle: PKR 2.5 Mn
or as defined in SME SBP PR whichever is less
Mark-up KIBOR + spread (NTB/ETB & with/without deviation)
Collateral Vehicle in the name of borrower with HPA in favour of UBL
Loan Tenor 5 Years
Main Features Type of Credit Facility: Term Finance
Type of Entities: SME – Sole Proprietor / Self-Employed
Type of Vehicles: Light Commercial Vehicle, Pick-up, Mini
Trucks, etc.
Down Payment: New 20% and Used 30%
Product Liquid Securities (Sahulat Loan)
Eligibility criteria • Experience: 6 Months in respective field
Max Financing As per exposure defined in SME SBP PR
Mark-up • KIBOR + spread (depend upon financing amount)
• Deposit + spread
Collateral Liquid Securities i.e. Certificate of Investment, Deposit,
selected National Saving Schemes, etc.
• Term Finance: Max 5 Years
Type of Entities:
Product Cotton Ginning – Seasonal
Eligibility criteria • Cotton Ginners with or without Oil Expeller unit
• Minimum Four saw gins
• 3 Years experience in respective business
Financing amount SE PKR 25 Mn & ME PKR 200 as per SBP PR
Commercial as per Policy
Collateral • Pledge of raw (phutti) & finished stocks (bales)
• Mortgage of Cotton Ginning Mill / residential /
commercial / industrial property
Loan Tenor • Max 1 Year
Main Features Type of facilities: Seasonal Cash Finance / RF
Availability Period: Jul till Mar and Expiry in Jun
Type of Entities: Proprietor / Partnership / Ltd Companies
Product Rice Husking – Seasonal
Eligibility criteria • Minimum 2 Tons Paddy per hour
• 3 Years experience in Rice Husking business
Mark-up KIBOR + Spread
Collateral • Pledge of raw (paddy) & finished stocks (rice)
• Mortgage of Rice Husking Mill / residential /
commercial / industrial property
Loan Tenor • Max 11 Months
Availability Period: Sep till Mar and Expiry in Jul
Product Wheat Financing for Flour Mills – Seasonal
Eligibility criteria • Minimum Eight Roller bodies
• 3 Years experience in Flour Mills business
Mark-up KIBOR + Spread
Collateral • Pledge of wheat
• Mortgage of Flour Mill / residential / commercial /
industrial property
Loan Tenor • Max 1 Year
Availability Period: Apr till Sep and Expiry in Mar
Product Smart Cash
Eligibility criteria • Experience: 6 Months in respective business
Max Financing As per exposure defined in SME SBP PR
Mark-up KIBOR + spread (depend upon financing amount)
Collateral Selected UBL Mutual Funds
• Term Finance: Max 5 Years
Type of Entities:
• Margin 15% - 40% (depend upon collateral type)
Product Prime Minister’s Youth Business Loans (PMYBL)
Eligibility criteria Resident Pakistani - Age between 21-45 years
For Small Enterprise only (as per SBP PR)
Financing Max PKR 2.0 Mn
Mark-up 6%
Collateral • Guarantor’s Guarantee of High Net-worth / Govt.
permanent employee BPS-15 or above
• Mortgage of residential / commercial property of owned
or 3rd party
• Selected Liquid Securities
• Light Commercial Vehicle in the name of borrower with
HPA in favour of UBL + Guarantor’s Guarantee
Term Loan Tenor • Max 8 years (including 1 year grace period)
Product Fleet Financing
Financing amount SE PKR 25 Mn & ME/Commercial PKR 200 as per SBP PR
whichever is less
Mark-up KIBOR + spread (NTB/ETB & type of entity)
Collateral • Term: Vehicle in the name of borrower with HPA in favour of
UBL
• Lease: Vehicle in the name of UBL
Loan Tenor Max 5 Years
Main Features Type of Credit Facilities: Term Finance & Lease Finance
Type of Vehicles: Light & Heavy duty Trucks, Pick-up,
Buses, Cars etc.
Min. Equity: New 10% to 20% & Used 20% to 25%
Product BG Discounting
Eligibility criteria • Dealer of Pesticide / Fertilizer
Financing amount 90% of BG face value or as per exposure defined in SME
SBP PR whichever is less
Collateral Assignment of proceeds against BG in favour of UBL
Loan Tenor • 180 days
Main Features Type of Credit Facility: Discounting
Purpose:
• Guarantee discounting facility for distributor / dealer /
supplier of Pesticides & Fertilizers
Type of Entities:
Title: Bancassurance Products
328
EFU Products
Better Life Better Life Child Better Life Marriage Better Life Better Life
Plan Name Savings Plan Education Plan Plan Retirement Plan Shaheen Plan
Unit-Linked Unit-Linked Unit-Linked Unit-Linked

Unit-Linked Whole Endowment/
Endowment Plan/ Endowment Plan/ Endowment Plan/ of Life Plan/ Regular Regular Premium/
Plan Type Regular Premium Regular Premium Regular Premium
Premium Plan Single/ Joint life
Plan Plan Plan Plan
Plan Entry Age 18 – 65 years 18 – 65 years 18 – 65 years 18 – 65 years 18 – 65 years
Plan Expiry Age 75 years 75 years 75 years 75 years 75 years
Term 10 – 40 Years 10 – 25 Years 10 – 25 Years Open Ended Plan 10 – (75 - Age )
A: Rs. 15,000/- A: Rs. 15,000/- A: Rs. 15,000/- A: Rs. 15,000/-

Premium Mode & S: Rs. 7,500/- S: Rs. 7,500/- S: Rs. 7,500/- S: Rs. 7,500/-
Minimum Premium A: Rs. 250,000/-
Q: Rs. 3,750/- Q: Rs. 3,750/- Q: Rs. 3,750/- Q: Rs. 3,750/-
Amount M: Rs. 1,250/- M: Rs. 1,250/- M: Rs. 1,250/- M: Rs. 1,250/-
329
EFU Products
Better Life Better Life Child Better Life Marriage Better Life Better Life
Benefits Savings Plan Education Plan Plan Retirement Plan Shaheen Plan
Continuation Benefit: Continuation Benefit:

Plan continues even Plan continues even
Sum Assured or
Cash Value, after death of Policy after death of Policy Sum Assured or Sum Assured or
Death Benefit Owner/ Parent Owner/ Parent Cash Value, Cash Value,
whichever is
Remaining Premiums Remaining Premiums whichever is higher whichever is higher
higher paid by company till paid by company till
Maturity Maturity
Maturity Benefit Cash Value Cash Value Cash Value Cash Value Cash Value
Death Benefit Formula Premium x Term Continuation Continuation Min 5; Max 75 Min 5 Max 75
330
EFU Products
Better Life Better Life Child Better Life Better Life Retirement Better Life
Benefits Savings Plan Education Plan Marriage Plan Plan Shaheen Plan
1. Accidental 1. Continuation
Death & Benefit 1. Continuation 1. Accidental Death &
Built In Disability Benefit
2. Waiver of Disability Benefit + • Joint Life Option Available
Benefit(s) Benefit + Premium (WOP) 2. Waiver of
2. Waiver of Premium (WOP)
Premium
Single Life:
1. Accidental Death and
1. Waiver of Disability Benefit OR
Premium Accidental Death &
1. Additional Term
Assurance 1. Income 1. Income 2. Additional Term Disability Benefit +
Assurance 2. Waiver of Premium
Additional 2. Family Income Benefit. Benefit. 3. Family Income 3. Additional Term Assurance
Benefits Benefit 2. Indexation 2. Indexation
3. Life care Benefit 3. F.A.P 3. F.A.P Benefit 4. Family Income Benefit
4. Life Care Benefit+ 5. Life Care Benefit +
4. F.A.P 5. Indexation 6. Hospital Care Benefit
6. F.A.P 7. Medical Recovery Benefit
8. Indexation
9. F.A.P
331
JLI Products
Better Life Better Life Child Better Life Better Life Better Life
Benefits Savings Plan Education Plan Marriage Plan Retirement Plan Parbat Plan
Unit-Linked Unit-Linked Unit-Linked Unit-Linked Unit-Linked

Endowment Plan/ Endowment Plan/ Endowment Plan/ Endowment Plan/ Endowment/ Regular
Plan Type Regular Premium Regular Premium Regular Premium Regular Premium Premium/ Single/
Plan Plan Plan Plan Joint life Plan
Plan Entry Age 18 – 65 years 18 – 50 years 18 – 65 years 18 – 65 years 18 – 65 years
Plan Expiry Age 75 years 75 years 75 years 75 years 75 years
Term 10 – 57 years 10 – 25 years 10 – 25 years 10 – 57 years 10 – 57 years
A: Rs. 15,000/- A: Rs. 15,000/- A: Rs. 15,000/- A: Rs. 15,000/-

Premium Mode & S: Rs. 7,500/- S: Rs. 7,500/- S: Rs. 7,500/- S: Rs. 7,500/-
Minimum Premium Q: Rs. 3,750/- Q: Rs. 3,750/- Q: Rs. 3,750/- Q: Rs. 3,750/- A: Rs. 250,000/-
Amount M: Rs. 1,250/- M: Rs. 1,250/- M: Rs. 1,250/- M: Rs. 1,250/-
332
JLI Products
Sum Assured or Sum Assured plus Sum Assured plus

Cash Value, (Return of Premium or (Return of Premium Sum Assured or Cash Sum Assured or Cash
Death Benefit Value, whichever is Value, whichever is
whichever is Cash Value, whichever or Cash Value,
higher is higher) whichever is higher) higher higher
Maturity Benefit Cash Value Cash Value Cash Value Cash Value Cash Value
Cover Multiple 05-254 10 05 05-254 05 - 254
333
JLI Products
1. Critical Illness (CI) Single Life:

2. Permanent Total 1. Critical Illness (CI) 1. Critical Illness (CI)
1. Family Income 1. Family Income
Optional Riders Disability (PTD) Benefit (FIB) Benefit (FIB) 2. Family Income 2. Permanent Total Disability
3. Family Income Benefit (FIB) (PTD)
Benefit (FIB) 3. Family Income Benefit (FIB)
Single Life:
1. Accidental Death (AD)
1. Accidental Death 2. Accidental Death &
(AD) Dismemberment (ADD)
2. Accidental Death 3. Waiver of Premium (WOP)
1. Child Education 1. Child Marriage 1. Accidental Death
Additional & Dismemberment Benefit (CEB) Benefit (CMB) (AD) 4. Hospitalization Cash Rider
(ADD) (HCR)
Riders 2. Waiver of 2. Waiver of 2. Waiver of
3. Waiver of Premium (WOP) Premium (WOP) Premium (WOP) Joint Life:
Premium (WOP) 1. Accidental Death (AD)
4. Hospitalization 2. Accidental Death &
Cash Rider (HCR) Dismemberment (ADD)
3. Hospitalization Cash Rider
(HCR)
334
UBL
AMEEN
PRODUCTS
CONTENTS
Current/Qard Based /Non-Remunerative
Ameen Mukammal Current Account (AMCA) - Local Currency

Ameen Current Account (ACA) - Foreign Currency
Ameen Asaan Current Account
Saving/Mudarabah/Demand Deposit/Remunerative Account

Ameen Saving Account (ASA) - Local Currency
Ameen Business Account (ABA) - Local Currency
Ameen Monthly Saving Account
Ameen Daily Munafa Account (ADMA) - Local Currency
Ameen Minor Saving Account (AMISA) - Local Currency
Ameen Premium Account (APA) - Local Currency
Ameen Asaan Saving Account
Ameen Financial Institution Deposit Account (AFIDA) - Local Currency
Term Deposit/Mudarabah/Time Deposit/Fixed Deposit/Remunerative Account

Ameen Certificate of Islamic Investment (ACOII) - Local Currency
Ameen Premium Certificate (APC) - Local Currency
336
CURRENT ACCOUNT
Qard Based.
Bank is liable to pay money back on

demand to depositor.
Bank can use these funds for investment
and other purposes.
Bank does not invest depositor’s money

in Non-Shariah compliant business/
activities.
337
AMEEN MUKAMMAL CURRENT ACCOUNT (AMCA) -
LOCAL CURRENCY
Nature Checking Account for individual &

Corporate customers
Underlying Islamic Mode Qard
Initial Deposit PKR 100/-
Number Of Transactions Unlimited
Minimum Balance Requirement No
ATM/VISA Debit Card Available
SMS Alerts Available
E-statement Facility Free
Net Banking Facility Available
Access To Your Funds Through online network of over
1,350+ UBL branches and 10,000+ ATMs across
Pakistan
Call Center Facility 24/7 Available
Full Service (Within Bank Timing) Non Stop 338
AMEEN CURRENT ACCOUNT (ACA)
FOREIGN CURRENCY
Nature Checking Account for individual &

Corporate customers
Acceptable Currency US Dollar, British Pound, Euro, Japanese Yen, UAE
Dirham and Saudi Riyal
Access To Your Funds Online transfers/remittances through a network of UBL’s

branches dealing in Foreign Currency across Pakistan
Full Service (Within Bank Timing) Non Stop
339
AMEEN ASAAN CURRENT ACCOUNT - LOCAL CURRENCY
Target Common People with low income
Account Opening Form One Pager
Documents Identity documents

Computerized/Smart National Identity Card (CNIC/SNIC)
National Identity Card for Overseas Pakistanis (NICOP)
Pakistan Origin Card (POC)
Alien Registration Card (ARC) issued by National Aliens
Registration Authority (NARA)
Passport
Pension Book
Declaration within AOF
W8 & W9 Form for FATCA compliant
Common Reporting Standard(CRS)
Account Opening Point Instant account opening process will be followed after
ensuring AOF & documents formalities are completed
340
AMEEN ASAAN CURRENT ACCOUNT (AACA)
FREE OF COST SERVICES
ARE AVAILABLE ACROSS
THE BOARD
FREE Inter Branch Online FREE Duplicate Account Statement

Transactions – Country Wide FREE UBL Go Green SMS Alert
FREE Cancellation of CC / CBC
FREE Debit / ATM Card (Issuance & FREE Clean Bill For Collection / Intercity Clearing
Annual Charges) FREE Duplicate Cashier’s Cheque / CBC
FREE Issuance of Cashiers Cheque / CBC

FREE Cheque Return Unpaid From Payee’s
FREE Cheque Book Account in Outward Clearing
FREE Over the Counter

Cash Deposit
341
AMEEN ASAAN CURRENT ACCOUNT

Acceptable Currency PKR
Number Of Transactions i)Total Debit per Month: Rs. 500,000/-
ii)Total Credit Balance Limit: Rs.
500,000/-
Pakistan
342
SAVINGS ACCOUNT
Mudarabah basis.
Special kind of partnership where the Capital Investment is made from one
partner and Work Expertise comes from other partner.
Hence Investor is called “Rabb-ul-Maal” and the working partner is called

“Mudarib” while investment is called “Ras-ul-Maal”.
Mudarabah has two types.
343
DISTRIBUTION OF PROFIT & LOSS
Parties have to agree on a definite proportion of the actual profit to which

each one of them is entitled.
They share profit at any ratio. Some incentives may be given to Mudarib.
In case of loss, All loss will be borne by “Rabb-ul-Maal” and Mudarib’s

share of profit will not be given to Mudarib.
The Mudarib & Rabb-ul-Maal cannot allocate a lump sum amount of profit
for any party nor can they determine the share of any party at a specific
rate tied up with the capital.
344
DISTRIBUTION OF PROFIT & LOSS
EXAMPLE
If the capital is Rs.100,000/-, they cannot agree on a condition that Rs.10,000 out
of the profit shall be the share of the Mudarib nor can they say that 20% of the
capital shall be given to Rabb-ul-Maal. However they can agree that 40% of the
actual profit shall go to the Mudarib and 60% to the Rabb-ul-Maal or vice versa.
345
MUDARABAH CUM MUSHARKAH
As bank deploys its own equity in depositors funds with the express
permission of Rabb-ul-Maal, hence the transaction becomes mudarabah
cum musharkah.
EXAMPLE:
A gave to B Rs. 100,000/- in a contract of Mudarabah. B added Rs.
50,000/- from his own pocket with the permission of A. This type of
partnership will be treated as a Mudarabah cum Musharakah.
346
AMEEN SAVING ACCOUNT (ASA) - LOCAL CURRENCY
Mudarabah based. It gives transactional flexibility.

Number of Transactions Unlimited
Profit Payout Frequency Six-Monthly
Profit Calculation Average Monthly balance
E-statement Facility Free
Net Banking Facility & SMS Alerts Available
Access To Your Funds Through online network of over 1,350+ UBL
branches and 10,000+ ATMs across Pakistan
347
AMEEN BUSINESS ACCOUNT (ABA) - LOCAL CURRENCY
Mudarabah based account aims at providing a Shariah Compliant tool to
individuals and corporate customers.

Profit Payout Frequency Six-Monthly
Profit Calculation Nominal profit calculated on daily average
balance
Access To Your Funds Through online network of over 1,350+ UBL
branches and 10,000+ ATMs across Pakistan
348
AMEEN BUSINESS ACCOUNT (ABA) - LOCAL CURRENCY
• Inter Branch Online Transaction - Country wide

• ATM/VISA Debit Card (Issuance & Annual Charges)
• Cheque Book Issuance
• Issuance /Cancellation of Cashier’s Cheque / CBC
• Over the Counter Cash Deposit
• Cheque Return Unpaid from Payee’s Account in Outward Clearing
• Clean Bill for Collection /Intercity Clearing
• UBL Go Green SMS Alerts
• Duplicate Cashier’s Cheque / CBC
• Duplicate Account Statement
• E-statement Facility
•All Government taxes and levies for services offered, whether free or charged as per
Schedule of Charges, will be recovered from the account holders.
349
1) Review of Daily Average Balance on Monthly basis.
2) In the event of losses, the account holder will bear the loss, while profit will be distributed
as per agreed ratio.
350
AMEEN MONTHLY SAVING ACCOUNT
A tier based saving account where the rate of return increases in each
progressive tier i.e. larger deposits fall into higher tiers with greater returns.


Profit Payout Frequency Monthly profit payment
Profit Calculation Tiered profit structure. Profit is

calculated on the basis of monthly average balance in a
calendar month

Pakistan

351
AMEEN MONTHLY SAVING ACCOUNT
A tier based saving account where the rate of return increases in each progressive
tier i.e. larger deposits fall into higher tiers with greater returns.
E-Statement facility Free
Net Banking facility Available
352
AMEEN DAILY MUNAFA ACCOUNT (ADMA) - LOCAL CURRENCY
Nature Checking account with higher return on daily product basis

Number of Transactions Unlimited
Profit Calculation Tiered profit structure with the association of daily day end
balance. Profit is calculated on daily product basis
Access To Your Funds Through online network of over 1,350+ UBL branches and 10,000+
ATMs across Pakistan
353
AMEEN DAILY MUNAFA ACCOUNT (ADMA) - LOCAL CURRENCY
354
AMEEN MINOR SAVING ACCOUNT (AMISA) - LOCAL CURRENCY
Ameen Minor Saving Account is designed specifically for junior/children under the
age of 18 years with exciting packages in accordance the rules of Mudarabah.


Profit Calculation Profit is calculated on monthly average balance
Exciting Packages Available
355
AMEEN MINOR SAVING ACCOUNT (AMISA) - LOCAL CURRENCY

Access To Your Funds Through online network of over 1,350+
UBL branches and 10,000+ ATMs across Pakistan
356
AMEEN PREMIUM ACCOUNT (APA) - LOCAL CURRENCY
Ameen Premium is a wide range tier based saving account where the
expected rate of return increases in each progressive tier i.e. larger deposits
fall into higher tiers with greater returns. Ideal for customers looking at
transactional flexibility with higher rates.

Profit Calculation Expected high rate of return with a wide range of tiers.
Profit is calculated on the Monthly Average balance
357
AMEEN PREMIUM ACCOUNT (APA) - LOCAL CURRENCY


Pakistan
In the event of losses, the account holder will bear the loss, while profit will
be distributed as per agreed ratio.
358
AMEEN FINANCIAL INSTITUTION DEPOSIT ACCOUNT (AFIDA) -
LOCAL CURRENCY
Ameen FI Deposit is a wide range tier based saving account where the
expected rate of return increases in each progressive tier i.e. larger deposits
fall into higher tiers with greater returns.

Profit Calculation Expected high rate of return with a wide
range of tiers. Profit is calculated on the basis of monthly average
balance in a calendar month

359
AMEEN FINANCIAL INSTITUTION DEPOSIT ACCOUNT
(AFIDA) - LOCAL CURRENCY
In the event of losses, the account holder will bear the loss, while profit
will be distributed as per agreed ratio.
360
AMEEN ASAAN SAVING ACCOUNT (AASA)
Ameen Asaan Saving Account is based on Mudarabah.

Profit is calculated on monthly average balance & paid half yearly.
Following free of cost services are available.
FREE Inter Branch Online Transactions – Country Wide

FREE Debit / ATM Card (Issuance & Annual Charges)
FREE Cheque Book
FREE Over the Counter Cash Deposit

FREE Cheque Return Unpaid From Payee’s Account in Outward Clearing
FREE Clean Bill For Collection / Intercity Clearing
FREE Duplicate Cashier’s Cheque / CBC
FREE Duplicate Account Statement

FREE UBL Go Green SMS Alert
361
AMEEN ASAAN SAVING ACCOUNT
Targeted at common people with low income unbanked / under-banked.
Underlying Islamic Mode Mudarabah

Acceptable Currency PKR
Number Of Transactions i)Total Debit per Month: Rs. 500,000/-
ii)Total Credit Balance Limit: Rs.
500,000/-
Pakistan

362
Term/Fixed/Time Deposits
The Certificate of Islamic Investment (COII) is a

Mudarabah-based deposit product through
which depositors can invest their savings for
periods ranging from 1 month to 10 years and
earn Halal profit on a periodic basis.
363
AMEEN CERTIFICATE OF ISLAMIC INVESTMENT (ACOII)- LOCAL CURRENCY
It is a fixed deposit certificate with three profit payment options
Profit at Maturity
Minimum amount to purchase a certificate PKR 10,000/-
Tenure 1 month to 6 months & 1 year to 10 years
Profit Bi-annually (July and January)
Tenure 1 to 10 years respectively
Profit Monthly (1st working day of the month)*
Tenure 1 to 10 years
Profit Quarterly (January and March)
Tenure 1 to 10 years
364
AMEEN CERTIFICATE OF ISLAMIC INVESTMENT (ACOII) - LOCAL CURRENCY
Premature encashment facility Available

Renewal option Available
Profit Payout Frequency 4 Different Options Available
Profit Calculation Profit is calculated on fixed amount

placed at the time of booking
Invested amount and Profit Available

credited to checking account
on Maturity and is available
through ATM and Net Banking
For other profit frequencies, Available

profit amount credited to
checking account is available
In the event of losses, the account holder will bear the loss, while profit will be distributed as
per agreed ratio.
365
AMEEN PREMIUM CERTIFICATE (APC) - LOCAL CURRENCY
Specially designed for those investment account holders who are willing to get
high return on their investments with multiple benefits.
Premature encashment facility Available

Renewal option Available
Profit Payout Frequency 1 month, 3 months, 6 months, 1year
and 1 year with monthly profit payout
Profit Calculation Profit is calculated on fixed amount
placed at the time of booking
Minimum amount to purchase a PKR 5,000,000/-
certificate
Invested amount and Profit credited to Available
checking account on Maturity and is
available through ATM and Net Banking
For other profit frequencies, profit amount Available
credited to checking account is available
In the event of losses, the account holder will bear the loss, while profit will
be distributed as per agreed ratio.
366
FREE OF COST SERVICES ARE AVAILABLE
Following free of cost services are available on all accounts except ACOIIs & APC.
FREE Inter Branch Online Transactions – Country Wide

FREE Debit / ATM Card (Issuance & Annual Charges)
FREE Cheque Book
FREE Over the Counter Cash Deposit

FREE Cheque Return Unpaid From Payee’s Account in Outward Clearing
FREE Clean Bill For Collection / Intercity Clearing
FREE Duplicate Cashier’s Cheque / CBC
FREE Duplicate Account Statement
FREE UBL Go Green SMS Alert

367
368
8. UBL Specific – Values
369
UBL Specific – Values
Refer below link for the course details:

https://eilm.org.pk/ubl
• Courses > UBL Specific > UBL – Values
370
9. Service Quality – Branch Role in
Handling Customer Grievances
371
WHAT IS CUSTOMER?
Any legal entity or person who has availed or is intending

to avail any product/ service from the banks/DFIs.
Dec-2018 Service Quality Slide 372 of 10

SIGNIFICANCE OF CUSTOMER SERVICES
Product Customer Service

WHAT IS COMPLAINT?
Any written or verbal expression of dissatisfaction from a person alleging financial loss
or inconvenience due to provision of or failure to provide product or services by the
bank or any third party with whom the bank has outsourcing arrangements

CAUSES OF COMPLAINTS
Delay in Service
Non-compliance of Lack of Product

Policy & Procedure Knowledge
Miscommunication System Handling
Unprofessional Behavior
Unpleasant
Environment

CHANNEL OF COMPLAINTS
Call
Letter
Regulator
Social Fax
Media
email
Branch
Website

COMPLAINT HANDLING MECHANISM – LOGIN
Customer
Branch Contact Center
Written complaint
to be emailed at
supervisor.cc@ubl.
Solution Available? Logged in System
com.pk
Yes No
Take written complaint / Detailed Doc

Inform Customer
assist complaint channels
COMPLAINT HANDLING MECHANISM – RESOLUTION
Review Complaint
Complaint Resolved Require Feedback
TAT: 24 Hours
Email to Branch / Department

Inform Resolution
If a customer is not satisfied with the bank No Response

stance against his complaint, branch staff will
inform him that he may approach to Banking
Mohtasib Pakistan (BMP)
Escalation till President
REQUIRED FROM BRANCH – ENHANCING CUSTOMER EXPERIENCE
Assisting
Customers

REQUIRED FROM BRANCH – HANDLING UNDELIVERED CONSIGNMENTS
When a consignment is returned Branch will call customer to visit branch

from customer address
Upon customer visit to the branch

credentials to be updated via CIF
Branch will convince customer for change
of address and subscribe for e-statement
OVERARCHING PRINCIPLES – IMPORTANCE OF
COMPLAINTS
BC & CPD Circular No. 1 of 2016 was issued on “Consumer Grievances Handling
Mechanism (CGHM)” on February 29, 2016.
Value customer Customer Fair and efficient

experience satisfaction resolution
Consumer Grievances Handling

Mechanism (CGHM)
Procedure Translate Help SBP to

awareness & customer focus on policy
compliance experience related issues
Mar-2018 Service Quality Slide 381 of 18

COMPLAINTS
Understanding Importance
Low Profits

COMPLAINTS
Role of Board & Senior Management
Management’s view
• Complaints 1. Fair
• Resolution
2. Unbiased
3. Prompt Resolution
Continuous Improvement
• Products
• Services
• Processes
ports •
ic Re Delivery Channels
iod
Mar-2018
Per Service Quality Slide 383 of 18
OVERARCHING PRINCIPLES – FAIR TREATMENT
Impartiality
in listening to
complaints
Efficient Complaint
Resolution
Bringing in
Synergies Monitoring Resolutions
COMPLAINT HANDLING MECHANISM
Structure Policy & Process Logging and Interim Final

Procedure visibility and acknowledging Reply Reply
accessibility complaint
Complaint Handling Mechanism
Dealing with Record Categorization Disclosure Information Reporting Monitoring

Vulnerable keeping and analysis of in annual system to SBP
Person complaint data accounts

1. Structure
Separate SQ
Function
CMU to be a part
of SQ
SQ Head reporting to
Senior Management

2. Policies & Procedure
Process
Roles &
Responsibilities
Analysis
Corrective Measures

3. Process Visibility & Accessibility
UBL BMP

4. Complaint logging & Acknowledgement
Complaint recording in CMS
Provision of Complaint Number
Acknowledgement in 48 hours
Complaint Resolution Bank

Process Timelines Contact
Number

5. Interim Response
Time:
11th Day
Response:
• Scrutiny Required
• Expected
Resolution Time

6. Escalation Procedure
Complaint
Phone HOD Senior President

Banker Management

7. Final Response
Nature:
• 7 working days not exceeding
more than 15 working days
• Fraud Related, 30 working days
• Visa/Master, 120 to 180 Days as
per association rules
Reply:
• Reason of denial
• Alternate grievance redressal forum

8. Information System
Centralized End-to-End Permanent Analysis

Data Base Information Record
9. Dealing with Vulnerable Person

Physically
Pensioners Handicapped
Illiterate
Senior
Citizens
Extra Understanding Resolution

Care Capacity at Branch

10. Record Keeping
Prudential Regulation:
10 Years
CCTV Recording:
• Circumstantial
Evidence: 2 Months
• Court: Final Decision

11. Disclosure in Annual Accounts

Brief Commentary on complaints to be added in Annual Accounts

12. Reporting to SBP
Quarterly reporting of
Complaint Handling to
State Bank of Pakistan in the
format provided by them in
circular

13. Monitoring - Complaint Handling Mechanism
Back

10. Service Quality – Mystery Shopping
Program Topline Results
OBJECTIVE
Improve overall Customer

Services at UBL branches
1 2
Evaluate front-line To benchmark existing
customer services against service levels with
own standards competition banks
Mar - 2019 Service Quality Slide 400 of 10

VISIT METHODOLOGY
Shoppers make Project Manager

Trained mystery The entire Videos are passed
observations and makes final checks
shoppers visit experience is through stringent
interact with to the reports and
designated Bank’s recorded using quality checks to
branch staff based videos and final
branches posing as hidden audio/video meet quality
on an agreed report is submitted
customers equipment standards
format to UBL
• Video Mystery Shopping visits made to UBL branches only
• For Competition banks, non-video Mystery Shopping visits were conducted

MYSTERY SHOPPING PROGRAM (MSP) – 2018 BRANCH BANKING REGULAR
SAMPLE & RATING CRITERIA BRANCH BANKING REGULAR

REGION UBL BRANCHES
Azad Kashmir 25
Bahawalpur 15
Faisalabad 24
Gujranwala 26
Hyderabad 8
Islamabad 33
Jhelum 26
Karachi Central 30
Karachi North 31
Karachi South 32
Lahore East 34
Lahore West 37
Mardan 12
Multan 32
Peshawar 24
Quetta 8
Rawalpindi 34
Sahiwal 18
Sargodha 14
Sialkot 15
Sukkur 5
Total 483

MYSTERY SHOPPING PROGRAM (MSP) – 2018 BRANCH BANKING REGULAR
Note: All scores are in percentage
2018
Branches : 483
Performance Criteria 2018 Outstanding = +90% & above Good = +80% - +89% Average = +71% - +79% Fail = Below +70%

MYSTERY SHOPPING PROGRAM (MSP) – 2018 BRANCH BANKING LOUNGES
SAMPLE & RATING CRITERIA BRANCH BANKING LOUNGES

REGION UBL LOUNGES
Bahawalpur 2
Gujranwala 1
Islamabad 1
Karachi North 1
Karachi South 3
Lahore East 1
Multan 1
Peshawar 1
Quetta 1
Rawalpindi 2
Sialkot 1
Sukkur 1
Total 16

MYSTERY SHOPPING PROGRAM (MSP) – 2018 BRANCH BANKING LOUNGES
2018
Lounges : 16
Performance Criteria 2018 Outstanding = 95% & above Good = 85% - 94% Average = 76% - 84% Fail = Below 76%

MYSTERY SHOPPING PROGRAM (MSP) – 2018 BRANCH BANKING AMEEN
SAMPLE & RATING CRITERIA BRANCH BANKING AMEEN

REGION UBL BRANCHES
Azad Kashmir 1
Bahawalpur 1
Faisalabad 2
Gujranwala 2
Hyderabad 2
Islamabad 8
Karachi Central 7
Karachi North 5
Karachi South 5
Lahore East 8
Lahore West 5
Mardan 2
Multan 2
Peshawar 8
Quetta 2
Rawalpindi 2
Sahiwal 2
Sargodha 2
Sialkot 2
Sukkur 1
Total 69

MYSTERY SHOPPING PROGRAM (VMSP) – 2018 BRANCH BANKING AMEEN
2018
Branches : 69
Note:
• MSP for Branch Banking Ameen was conducted for the first time in 2018.
Performance Criteria 2018 Outstanding = +90% & above Good = +80% - +89% Average = +71% - +79% Fail = Below +70%

11. Code of Conduct/ COE
Code of Conduct/ COE
Dear Colleagues,

UBL Code of Conduct spells out what is expected from every member of the UBL family. This Code of Conduct serves to define the
behavioral framework for our conduct at work. It describes how we put our values of Customer First, Honesty of Purpose, Teamwork,
Excellence and Meritocracy into practice. The Code defines expectations from employees towards all stakeholders and provides guidance
for employees and everyone who works on our behalf.

Our reputation is integral to our success and reputation comes from our actions on a continuous basis. Our performance in conducting the
Bank’s business in a manner that is consistent with the principles contained in the Code enables us to keep and enhance that reputation.

At UBL we recognize that each one of us is individually responsible for making sure that we conduct ourselves in a manner that is in full
compliance with the laws, regulations and guidelines that govern our industry.

To be a truly successful organization, we therefore must act in a manner that reflects the Values outlined in the Code of Conduct. You are
requested to read carefully, and understand clearly, the UBL Code of Conduct and return its acceptance to HR confirming its receipt,
understanding and acceptance.

In this regard I personally acknowledge that I have received a copy of the UBL Code of Conduct and declare that I have read, understood
and accepted the contents stated therein and shall abide by these to the best of my abilities.

Sima Kamil

President
1. Each United Bank employee must:
1.1 Avoid any conflict (or even the perception of a potential conflict) between his or her personal, social, financial or
political interests and the advancement of the Bank’s business interests or the interests of its customers.
1.2 Always act on behalf of the Bank in ways that enhances the Bank’s reputation, integrity and its brand name.
2. Conflict of interest:
Following are a few areas where the involvement / engagement of the employee shall be considered as misconduct
and liable for disciplinary action:
2.1 An employee with financial authority favors Vendor “X” because;
(a) The employee is a part owner of Vendor “X”;

(b) A relative of the employee works for Vendor “X”; or
(c) The employee has accepted an offer from Vendor “X” of special discounts for personal purchases.
2.2 An employee uses his / her UBL stationery to market a family member’s or friend’s business, or to
raise money for a political candidate. UBL stationery should be used for official / business communication only.
2.3 An employee participates in reviewing and approving an application for a loan from a corporation in which they
hold a post of a director.
2.4 An employee discloses proprietary UBL information (e.g. forms, procedures, data) by writing an article or book
that personally profits or furthers his / her career, without taking prior permission from the relevant authority.
2.5 An employee involved in non-preservation / sharing of passwords & security aspects of Bank’s systems which may
or may not result in any financial loss to the Bank.
3. Gifts & Entertainment (Customers & Third Parties):
3.1 Roles and responsibilities:
Staff – All staff must ensure that they follow the policy and the procedure of the Bank in true letter and spirit. Staff
must not engage in behavior aimed at circumventing the system and controls in place, for example, splitting
expenditures into multiple small claims. Each staff is responsible for obtaining the requisite approvals for gifts and
entertainment as per the laid down procedure.
Line Managers – responsible for upholding these procedures in true letter and spirit, and must undertake reasonable
measures to oversee compliance of the same by their staff, while simultaneously reinforcing the requirements of the
defined procedures.
3.2 Prohibitions:
• Giving gifts to staff is strictly prohibited at all levels, i.e. staff cannot give gift(s) to their supervisors, colleagues,
sub-ordinate or any other staff member.
• Giving or receiving gift in the form of cash of any amount is strictly prohibited.
• Under no circumstances should any gift be accepted from current or potential vendors / suppliers either by the
employee or by any immediate member of the employee’s family.
• An employee must refrain from giving a gift to a customer or a government official which may be interpreted as
consideration for a business / official / personal favor.
• While reimbursing expenses, the amount should only be credited to the salary account of the staff who paid the
bill at the time of incurring gift or entertainment expense. In cases where payment needs to be directly to vendor,
then it should either be credited to vendor’s account if maintained with the UBL or Cashier Cheque to be issued
in favor of vendor. In any circumstances, routing of the same through cash or any other accounts, e.g. relatives,
coordinators or third party accounts is strictly prohibited and will be construed as breach of the procedures.
• Masking of expenses, e.g. manipulating the nature of an expense or splitting expenditure into multiple small
claims is strictly prohibited.
For clarification, the detailed procedure and process outlined in the Standard Operating Procedures disseminated vide
Misc. Circular # 5994 dated October 06, 2017 shall be refer.
3.3 Breaches:
All staff must ensure that prudence is exercised at all levels in true letter and spirit to safeguard the interest of the
Bank and its staff. Anyone found deviating from approved procedure shall be held accountable as per Bank’s policy.
4. Harming United Bank’s reputation:

Following are few instances which are considered harmful to the reputation of the Bank. All employees are advised to
refrain from such situations:
4.1 An employee borrows money from, or in any way places himself under pecuniary obligation either to a broker, a
money lender, a subordinate employee of UBL, any firm or persons having dealings with UBL.
4.2 An employee buys or sells stocks, commodities, foreign exchange or securities of any description without funds
to meet the full cost thereof.
4.3 An employee arranges for a UBL customer to be granted preferential treatment as a vendor. (A Chinese wall
should be maintained that precludes even the act of customer status to be known to those making decisions with
respect to vendors).
4.4 An employee involved in propagating defamatory statements on social media with respect to country of
placement.
5. Employee participation in Political Organization & Prohibition of outside pressure: As per guidelines of the State
Bank of Pakistan, all UBL employees are required to strictly adhere to and comply with UBL Policy Manual Chapter
“Accountability & Discipline” covering Bank’s policy on employees’ participation in political organizations and
prohibition of outside pressure. The relevant clauses are reproduced below for immediate reference:
5.1 Participation in Political Organizations:
a) No employee shall be a member of a political party, take part in, subscribe in aid of, or assist in any way, any
political movement in Pakistan or relating to the affairs of Pakistan.
b) No employee shall permit any dependent person to take part in, or in any way assist, any movement or activity
which is, or tends directly or indirectly to be, subversive of Government as by law established in Pakistan.
c) No employee shall canvass or take part in any election to a legislative body, whether in Pakistan or elsewhere. An
employee who is qualified to vote at such election may exercise the right to vote, but if he/she does so, he/she shall
maintain secrecy of his/her ballot.
d) An employee who addresses electors or in any other manner publicly announces himself/herself or allows
him/her to be announced as a candidate or prospective candidate for election to a legislative body shall be deemed
to take part in an election to such body.
e) The provisions of this rule shall, mutatis mutandis, apply to election to local bodies, save in respect of employees
permitted by or under any law, to be candidates at such elections.
5.2 Prohibition to bring outside pressure etc.:

Bringing or attempting to bring political or other outside pressure/influence directly or indirectly to bear on the
authorities/superior officers or indulge in derogatory pamphleteering, contribute articles, or write letters to the
newspapers, anonymously or in his/her own name with an intent to induce the authority/superior officers or to act in
a manner inconsistent with policies, procedures, rules & regulations, in respect of any matter relating to the
appointment, promotion, transfer, punishment, retirement or for any other condition of service of employment.

All employees should carefully read and understand its implications, as intentional or un-intentional violation may
attract strict Disciplinary Action that could result in termination of service, and or reporting of such misconduct to Law
Enforcement Agencies (LEAs).
6. Fair Treatment of Customers (FTC)
6.1 Fair Treatment of Customers (FTC) is a regulatory approach that seeks to ensure that specific, clearly articulated
fairness outcomes for financial services customers are demonstrably delivered. The Bank has developed its
“Consumer Protection Framework 2015”. The purpose of the framework is to ensure:
a. Fair Treatment of all customers across the Bank and in all its dealings including Business Strategies, Product
Design, Financial Promotional Sales, Complaints handling and Customer services.
b. Enable customers to make informed decisions.
c. Improve customers’ confidence in the Bank.
d. Make customers aware of their rights.
e. Enable customers to share their grievances.
6.2 The Six Fairness outcomes:
The FTC fairness outcomes, positioned from the perspective of the customer, are as follows:
a. Customers are confident that they are dealing with a bank where fair treatment of customers is central
to the bank’s culture.
b. Products and services marketed and sold are designed to meet the needs of identified customer
groups and are suitable for customers according to their risk profile.
c. Customers are given clear information and are kept appropriately informed before, during and after
the time of contracting.
d. Where customers receive advice, the advice is suitable and takes account of their risk profile.
e. Customers are provided with products that perform as the bank has led them to expect, and the
associated service is both of an acceptable standard and what they have been led to expect.
f. Customers have access to channels for lodging complaints.
Fairness outcomes are to be delivered throughout the product life cycle. Delivery of these outcomes will ensure
the supply of appropriate financial products and services to customers and enhanced transparency and
discipline, resulting in improved customer confidence. All employees should carefully read and understand the
Consumer Protection Framework 2015 and refer in day -to-day work.
7. Money Laundering (ML) and Financing of Terrorism (FT)
An employee will be guilty of offence if, found involved in ML / FT activities in violation of regulatory instructions /
policies issued from time to time.
8. Confidential information:
8.1 Confidential information concerning a customer or a supplier must never be disclosed to a third party except
pursuant to applicable laws or regulations, or a court order or other legal process, or after the informed
consent of the customer or supplier in writing.
8.2 Bank employees are strictly prohibited from disclosing the fact to the customer or any other quarter that a
suspicious transaction or related information is being or has been reported to any authority, except if required
by law.
8.3 Likewise, proprietary UBL information (confidential information about UBL’s business or business development
plans, products and services, marketing methods, technology or systems) must never be disclosed to a third
party except pursuant to a statute or regulation, or a valid court order.
8.4 For these purposes, “confidential information” is non-public information about UBL or a customer or supplier
that would be useful to a competitor or important to an investor in deciding whether to purchase, hold or sell
any shares of a customer or supplier of UBL, as applicable.
9. Insider trading:
9.1 As per securities laws, the communication by an “insider” of purchase or sale of a security while in possession
of “material non-public information” is illegal and a crime and is subject to substantial fines, damages,
imprisonment and other proceedings. “Insiders” include employee’s relatives and others who have access to
employee. Any use by the “insider” of this information for trading securities or by disclosure by way of “tips”
to third parties is dubbed as “insider trading”.
9.2 All employees who fall under the category of “insider” or have access to “material non -public information”
should refrain to disclose such information to anyone outside the Bank.
10. Customers, Vendors and Counterparties:
In order to safeguard UBL’s reputation for integrity, it is not only necessary for employees to discipline their own
actions, it is also necessary to be aware of the character and actions of customers, vendors, and counterparties.
Care must be exercised in selecting those with whom we deal, and each UBL line of business must have processes
in place for checking on the credit and character of customers, vendors and counterparties.
11. Personal investment policy:

11.1 The CEO or executives (executives means an employee whose annual basic salary in a financial year i.e. July
– June is equals to or exceeds PKR 1,500,000 or equivalent in local currency) of the Bank or their spouse(s) /
minor children intending to sell or purchase UBL shares (directly or indirectly) shall notify this fact within
two (2) working days, in writing, to the Company Secretary, in line with the Personal investment policy,
contained in the Compliance manual.
11.2 Similarly, all employees who fall in the above mentioned category shall refrain from buying / selling of UBL
shares (directly or indirectly) during the “closed period”, announced by the bank from time to time.
12. Offences:
An employee will be guilty of an offence, if they without lawful authority involve themselves in any act mentioned
below but not limited to:

12.1 An employee issuing an incorrect account statement, salary certificate or any other information for any
customer or staff member.

12.2 An employee issuing a nonexistent or fake receipt for reimbursement of any expenses whereby the expenses
are inflated. Additionally pocketing of any difference between salaries claimed for driver, guard etc., and
what is actually paid to them is also considered a misdeclaration.
12.3 Solicits or accepts any advantage as an inducement or reward for doing or intending to commit any act in
relation to UBL’s affairs or business.
12.4 Shows or intends to show favor or disfavor to any person in relation to UBL’s affairs or business.
12.5 Offer any advantage to anyone as an inducement or reward for or otherwise.
12.6 Intends to deceive UBL by using any receipt, account or other document which is false or erroneous or
defective in any way, and which to his / her knowledge is intended to mislead UBL.
13. Fraud, theft or illegal activities:
13.1 Employees should be alert and vigilant with respect to frauds, thefts or illegal activities committed within the
offices. If any such activity comes to the attention of an employee, the employee must immediately report
the same to the Manager / Group Head and to the relevant Area Compliance Officer, or UBL’s Head of
Compliance & Control Assurance who will arrange for appropriate follow-up action to be taken. Failure to
report any such activity promptly will be subject to disciplinary action.
14.
Other Corporate ethical principles:
Below are some important corporate ethical principles and requirements to which employees of United Bank must
adhere to:

14.1 An employee must seek approval from President / CEO before becoming officially involved with any outside
corporation or other organization as director, trustee, officer or advisor.

14.2 An employee must obtain the consent of his / her supervisor and Group Executive – Human Resources
before submitting a literary work for publication or making a public speech. Generally, approval will be
granted if the writing or speech does not hinder legitimate UBL Business interests and does not involve the
disclosure of confidential UBL information.

14.3 UBL’s internal ethical standards are the result of shared moral convictions. Rationale like “everyone in the
market does it” or “our competitors do it” cannot be considered as permission to deviate from our
standards.

14.4 Compliance with laws, regulations and ethical standards is an important element of your obligations as an
employee of UBL to our customers, our shareholders, the general public and other staff. It is a part of an
employee’s corporate social responsibility to take compliance seriously. Each employee of the Bank should
think of compliance as a personal responsibility and should be expected to be held accountable for all
compliance related activities.
15. Punishments:
15.1 When an employee of UBL commits a breach of the policies, and does something detrimental to the
interest of UBL, he / she may be subject to immediate termination by invoking the appropriate clause of the
appointment letter or liable to disciplinary action in accordance with UBL’s disciplinary policy.
15.2 UBL management, in its sole discretion, shall determine what act or omission constitutes misconduct,
breach of trust or negligence of duty and its consequences with respect to any employee.
16. Declaration:
16.1 That I have not been declared as a defaulter in payment of any financial obligation / loans to a banking
company, a financial institution or a non -banking financial institution. I have never been declared as a
defaulter by regulator nor is my name reported as defaulter on credit bureau report of any regulator.
I hereby authorize the Bank to check my credit bureau report as and when required.
16.2 That I have not been convicted by any court of law and have never been declared incompetent by any
regulator to perform a specific job / function.
16.3 That in case of any default in any of my financial obligations towards UBL on consumer products / staff loans
being offered / sanctioned by UBL, the Bank will have all the rights to recover the said staff loans / consumer
products liabilities, if any, from me as may deem fit and proper with or without intervention of the court of
law and the Bank, may in order to recover the same, have the right to adjust the said loan from my salary,
block the entire salary or offset my outstanding against UBL, at the time of separation of services, by offsetting
my Provident Fund, Gratuity Fund or any other receivables.
16.4 That in case of my adjustment / off setting against my outstanding staff loans / consumer liabilities, if any,
from my salary, Provident Fund or Gratuity Fund or any other receivables, I and / or any member of my family
shall not raise a claim or file any litigation against UBL, for that matter.
16.5 That while I am currently in the employment of UBL, I will not engage in any other outside employment
including during the period of Leave Preparatory to Retirement (LPR).
16.6 In line with Para 14.1, I confirm that I will not participate in public affairs, or carry out part time job /
directorship without prior approval from President & CEO and obtaining a “No Objection Certificate” from
Human Resources. If so, I shall notify the same in writing to the Company Secretary.
16.7 I further declare that I will ensure in case of any change in my status as given at the time of signing the COC, I
will in a timely manner notify Human Resources of any changes in information / details, provided in the
acceptance such as relative hires during the year, holding other positions or change in contact details.
16.8 To the best of my knowledge, information and belief, I hereby declare that as of date I do not have to report
any matter in terms of Bank’s Whistle Blowing Policy. I further declare that I will report the matter as and
when, it comes into my knowledge or through information or to my belief.
16.9 I will not undertake part-time job / business for any organization or accept fee thereof;
16.10 I will not work in any honorary capacity without approval of the Management.
16.11 I will not hold the office of Director in any form or manner, including independent Director without the prior
approval of Management.
16.12 Family business: I will not engage or invest in any commercial business, either on my own account or my
family (spouse and children) or as an agent for another or others.
16.13 Family business: I will not create financial (or otherwise) any interest, make investment, buy shares, or indulge
in any kind of family (spouse & children) business.
16.14 Family business: I will declare any immediate family (spouse & children) member holding a position with any
entity including but not limited to Vendor & Supplier doing or seeking business with the Bank.
16.15 Family business: I will declare my family (spouse and children’s) business if any.
PLEASE NOTE THAT IF AN EMPLOYEE IS FOUND GUILTY OF VIOLATION OF ANY OF THE ABOVE UBL’s CODE OF
CONDUCT & ETHICAL STANDARD, COMPLIANCE STANDARDS, REGULATIONS AND LAWS OF THE COUNTRY, HE /
SHE WILL BE DEALT WITH ACCORDING TO THE DISCIPLINARY RULES & REGULATIONS.
EMPLOYEES ARE ADVISED TO FOLLOW THE ABOVE ETHICAL AND COMPLIANCE STANDARDS IN THEIR DAY TO
DAY ACTIVITIES AND MUST CONSULT THEIR LINE MANAGERS IN CASE OF CLARIFICATIONS, IF REQUIRED.
IN CASE OF ANY CHANGE IN STATUS AS DECLARED IN THE COC DURING THE YEAR, EMPLOYEES SHALL BE
DIRECTLY RESPONSIBLE TO INFORM HUMAN RESOURCES IN WRITING OF THE RELEVANT CHANGE IN STATUS
I.E. RELATIVE HIRING, HOLDING ANY OTHER POSITION(S) BESIDES UBL AND ANY CHANGE IN CONTACT
DETAILS.
• CODE OF CONDUCT AND ETHICAL STANDARDS 2018 ACCEPTANCE
 I hereby declare that currently I have the following relatives working in UBL or UBL Subsidiaries (Domestic
& International), or deployed at UBL through a 3rd party. Relatives include the employees’ real and
step parents, brothers, sisters, spouse(s), children, nephews & nieces (children of brothers & sisters),
Aunts & Uncles (Brothers & sisters of the employees’ parents and their respective spouses), first cousins
(children of Aunts & Uncles), parents in law, brothers & sisters in law (due to marriage)”.
Details of relatives working in UBL or its subsidiaries:
Name Emp. No:

Department Relationship:
Name Emp. No:
Department Relationship:
(*) Please fill “None” in case no relatives are currently working with UBL or its subsidiaries and the same shall
be updated subsequently as and when required. Continue overleaf, if required.
• Details of family (spouse & children) business
Company Name:
Position:
Since (date)
Name of family member & relationship
Company Name:
Position:
Since (date)
Name of family member & relationship
(*) Please fill “None” in case no family member is currently involved in any business and the same shall be updated
subsequently as and when required. Continue overleaf, if required.
• In compliance with the “Other Corporate Ethical Policies” I hereby declare that with the prior approval I am
currently holding following position(s) outside UBL:
Company Name:
Position:
Since (date)
HR approval (date)
Company Name:
Position:
Since (date)
HR approval (date)
(*) Please fill “None” in case not holding any position outside UBL. Continue overleaf, if required.
Employee Signature
My updated contact details are as under: (Mandatory to complete)
I hereby acknowledge that I have received a copy of the UBL’s Code of Conduct and Ethical Standards 2018 and declare that I
have read and clearly understood the conditions and declarations stated herein and will abide by them. I also acknowledge
that I am responsible to inform HR immediately of any change during the year in the information given above.
Emp. No. _____________Name of Employee: _______________________________________________
Grade _________CNIC No._________________________________________________ (copy attached)
Signature: ____________________________ Dated: __________________________

Form reviewed and verified by (to be filled by line manager)
12. KYC/ CDD and AML/ CFT
E Learning Pack 2018-Understanding AML/CFT
Framework from Local & International Perspective-
Compliance Group UBL
448
What is (KYC) Know Your Customer ?
- KYC means “Know Your Customer”.
- It is a process by which banks obtain information about the identity and
address of the customers
- This process helps to ensure that banks services are not misused for any kind
of illicit activity related to money laundering or terrorist financing
- The KYC procedure is to be completed by the banks while opening and
maintaining accounts or banking relation ships with various type of
customers
Why do Banks do (KYC) Know Your Customer ?
- Know your customer (KYC) policy for the any bank is an important step to
prevent identity theft, financial fraud, money laundering and terrorist
financing
- The objective of KYC is to enable banks to know and understand their

customers better and help them manage their risks prudently
449
How we do KYC ?
Following are some of the KYC Principles which can be used in order to assess
customer while opening or maintaining any banking relationship with him;
- Obtain and confirm details of the customer's identity

- Obtain and verify the customer's temporary address, workplace address,
permanent address etc.
- Obtain and verify the details of customer's business /employment
- True copy of relevant documents/records/details that needs to be obtained
from various types of individual/ non-individual customers
- To obtained purpose of account
- Obtain visit reports/call reports, financials of the customer, Passbook records,
unwrapping documents in case of legal persons to identify ultimate
beneficial ownership of the customer
- Obtain volume of expected turnover in the account
- To ascertained economic activity of the customer, Is that legitimate?
- To obtained Source of funds, are they clean?
450
What is Money Laundering?
• Money laundering' is the name given to the process by which illegally obtained funds are
given the appearance of having been legitimately obtained.
• A process by which the proceeds derived from illegal activities are concealed or disguised and
made to appear legitimate.
• Simply Money laundering is the conversion of dirty money into clean money.
A Typical Money Laundering Scheme

Placement: The monies are placed into the financial system or retail economy or are smuggled out of
the country. The aims of the launderer are to remove the cash from the location of acquisition so as to
avoid detection from the authorities and to then transform it into other asset forms; for example:
travellers cheques, postal orders, etc.
Layering: This is the first attempt at concealment or disguise of the source of the ownership of the
funds by creating complex layers of financial transactions designed to disguise the audit trail and
provide anonymity.
Integration: It is this stage at which the money is integrated into the legitimate economic and financial
system and is assimilated with all other assets in the system. Integration of the "cleaned" money into
the economy is accomplished by the launderer making it appear to have been legally earned.
451
Three stages of “Terrorism Financing”
2.Dissemination is moving the
1.Collection 3. Usage is Otherwise knows as
funds to disguise their origin.
“point of use” the funds get to
Both legitimate and illegal Ownership of funds separated
the point at which it is used to
funds are collected and from the source of funding
aid individual terrorist and
injected into financial system through multiple transfers
terrorist activities
within and across jurisdiction
452
International AML/CFT Regimes & their Brief Orientations
United Nations Office on Drugs and Crime (UNODC) & it’s Role
UNODC is a global leader in the fight against illicit drugs and international crime which
was established in 1997. Three pillars of the UNODC work programme are; Field-
based technical cooperation to enhance the capacity of member states , research and
analytical work, development of domestic legislation on drugs, crime and terrorist
Egmont Group of Financial Intelligence Units & It’s Role
The Egmont Group is a united body of 152 Financial Intelligence Units (FIUs). The
Egmont Group provides a platform for the secure exchange of expertise and financial
intelligence to combat money laundering and terrorist financing (ML/TF).
Financial Action Task Force (FATF) & It’s Role
The Financial Action Task Force (FATF) is an inter-governmental policymaking body. The
objectives of the FATF are to set standards and promote effective implementation of legal,
regulatory and operational measures for combating ML/TF. It was formed in 1989 & issued
40 recommendations to fight money laundering and terrorist financing since then
Office of Foreign Assets Control (OFAC)
The Office of Foreign Assets Control (OFAC) of the US Department of the treasury
administers and enforces economic and trade sanctions based on US foreign policy and
national security goals against targeted foreign countries and regimes, terrorists,
international narcotics traffickers, 453
Major Local Laws and Regulation dealing with AML/CFT Regime :
In Pakistan prevailing laws and regulations that dealt with AML/CFT regarding Banks/FI are but not
limited to the following :
– AML Act, 2010
– AML /CFT Regulations
– AML/CFT Guidelines
SBP PRs, AML Act and National Accountability Ordinance, Anti Terrorist Act 1998 and other laws not
only apply to criminals but also to banks and its employees. Both the employee and the financial
institution could be subject to penalties for any violations.
AML ACT 2010 – Protection

Financial Institutions and their officers are not liable to any civil, criminal or disciplinary proceedings against them for furnishing information under this Act
Currency Transaction Report

All single cash transactions amounting to Rs 2 million & above are reported within seven days of transaction
Suspicious Transaction Report
Suspicious transactions are reported within seven days of forming a suspicion
454
AML ACT 2010 – Offence of Money Laundering
A person shall be guilty of offence of money laundering, if he;
• Acquires, converts, possesses, uses or transfers property, knowing or having reason to believe that
such property is proceeds of crime
• Conceals or disguises the true nature, origin, location, disposition, movement or ownership of
property, knowing or having reason to believe that such property is a proceeds of crime
• Holds or possesses on behalf of any other person any property knowing or having reason to believe
that such property is proceeds of crime
• Participates in associates, conspires to commit attempts to commit, aid, abets, facilitates or counsels
the commission of the acts.
Punishment for money laundering

- Whoever commits the offence of money laundering shall be punishable with rigorous
imprisonment for a term which shall not be less than one year but may extend to ten
years
- Shall also be liable to fine which may extend to one million rupees
- Shall also be liable to forfeiture of property involved in money laundering or property
of corresponding value
- Provided that the aforesaid fine may extend to five million rupees in case of a
company and every director, officer or employee of the company found guilty under
this section shall also be punishable
455
Being UBL’s Employee what is my Responsibility?
Employees who have Employees must recognize that

Employees must be contact with customers certain clients pose a higher risk to
aware of AML/CFT have a high degree of the institution and perform
policy, procedures, so responsibility for ensuring enhanced due diligence on these
that he/she can that they do not willingly or clients along with enhanced
exercise the same unwillingly assist / advise in monitoring of transactions
with letter and spirit 1 structuring a transaction in
a way to avoid their
reporting or record keeping Any employee who suspects
requirements money laundering or terrorist
financing should immediately refer
the matter to compliance
department
456
AML /CFT Regulations for Banks & DFIs
Regulation 1- Customer Due Diligence (CDD)
Regulation 2- Correspondent Banking
Regulation 3- Wire Transfers/Fund Transfers
Regulation 4- Reporting of Transactions (STRs/CTRs)
Regulation 5- Record Keeping
Regulation 6- Internal Controls, Policies, Compliance, Audit & Training
R-1 CUSTOMER DUE DILIGENCE (CDD)

Banks shall apply CDD measures when establishing business relationship ,dealing with occasional customers/ walk-in
customers , situations/ scenarios when there is suspicion of money laundering/financing of terrorism, regardless of
threshold.
Customer due diligence in broader term includes;
• Identifying and verifying customer’s identity

• Identifying beneficial owner who is not the customer & verifying his identity
• In case of a legal person, trust or similar legal arrangement, understand the ownership and control
structure of the person, trust or arrangement
…..To be cont
457
To be Cont…
• Understanding and obtaining information on the purpose and intended nature of the business relationship
• Monitoring of accounts/transactions on ongoing basis to ensure that
 transactions are consistent with bank’s knowledge of the customer, their business and risk profile &
source of funds
 updating records and data/ information to take prompt action when there is material departure from
usual and expected activity through regular matching with information already available with bank
Risk levels Low Medium High

Frequency Three years Two years One years from the
of Review from the from the account opening or
account account last review
opening or last opening or
review last review
- Normal Customer Due Diligence (CDD) process would be used for accounts categorized as Medium or Low Risk
- Enhanced Due Diligence (EDD)process would be followed for accounts categorized as High Risk.
Note : In case of joint accounts, CDD measures on all of the joint account holders shall be performed as if each of them were individual
customers of the bank
458
R1 – Customer Due Diligence
 Each Bank must have a KYC/CDD/CDD Policy
 Minimum set of documents for Establishing Business relationships
 Identification & Verification of Identity of Natural persons/Beneficial Owner
 Information on Purpose and Intended Nature of Business Relations
 CDD measures for Walk-in customers
 On going due diligence and updating customer’s information
 When have doubts about the reliability or adequacy of previously obtained customer data
 Risk categorization and enhanced diligence for high risk accounts
 For Govt. accounts, Special resolution/ authority from the concerned administrative
department duly endorsed by the Ministry of Finance
 CDD to be established /performed for all the Joint Account Holders
 Prohibition of personal accounts for business purposes
 Prohibition of anonymous accounts or accounts of fictitious persons
 Politically Exposed Persons (PEPs)
 NGOs/NPOs/ Charities’ accounts
 Asset Side Customers **
459
R-1 CUSTOMER DUE DILIGENCE (CDD)-SPECIAL SCENARIOS
NGOs/NPOs/ Charities’ accounts
 Banks should conduct enhanced due diligence (including obtaining senior management approval- not less than EVP)
while establishing relationship with NGOs /NPOs and Charities to ensure that these accounts are used for legitimate
purposes and transactions are commensurate with the stated objectives and purposes
 The accounts should be opened in the name of title given in entity’s constituent documents
 Individuals who are authorized to operate these accounts and members of their governing body should also be
subject to comprehensive CDD
 As per internal circular, branches are also required to obtain CG clearance before opening of account
 Personal accounts shall not be allowed to be used for charity purposes/collection of donations.
Government Accounts, autonomous entities , armed forces including their allied offices
 Government accounts shall not be opened In the personal names of the government official(s)
 Government account which is to be operated by an officer of the Federal/ Provincial/ Local Government in his/her
official capacity, shall be opened only On production of a special resolution/authority from the concerned
administrative department Duly endorsed by the Ministry of Finance or Finance Department of the concerned
Government in case of autonomous entities and Armed Forces including their allied offices;
In case of autonomous entities and Armed Forces including their allied offices;
Banks/ may open bank accounts on the basis of special resolution/authority from the concerned administrative
department or highest executive committee/management committee of that entity duly endorsed by their respective
unit of finance
 In case of PEP, prior name clearance through World Check from CCG should be obtained whereas approval for
account opening/ relationship is to be obtained from respective business head (not less than the rank of EVP)
(For details refer CG’s Circular No 351)
460
Prohibition of personal accounts for business purposes
Banks shall not allow personal accounts to be used for business purposes however business transactions in
personal account may be permitted by linking it with account/business turnover, additionally;
 Documented attempts(letters to customer) will be made to persuade customers ( sole proprietors and self
employed professionals) having actual monthly business related credit turnover PKR 5 million & above in
his/her “Personal Account” for consecutive three months to open a separate account in the name of
business.
 In case customer does not open a separate account for routing business transactions personal accounts
will be categorized “Individual-Business account”.
 Prescribed customer’s declaration form is required to obtained minimum once a year for such accounts in
addition to EDD/CDD measures. Declaration form may also be required whenever there is a change in
customer’s profile .
Ref: Operations Circular# 456
461
CDD Measures for Occasional Customers/ Walk-in Customers
Obtain Copy of CNIC from Occasional Customers/walk-in customers when
 Conducting Cash transactions above Rs.0.5m (As per bank procedure CNIC is required for all cases irrespective of
amount).
 Conducting online transactions by occasional customers/walk-in-customers (except deposits through Cash Deposit
Machines or cash collection/management services).
 If transaction exceeds Rs.100,000 the name and CNIC No. shall be captured in system and made accessible along
with transaction details at beneficiary’s branch.
 Issuing remittance instruments e.g. POs, DDs, CCs etc. (As per bank policy, no walk-in customer can have an
instrument issued above Rs.0.25M in a day)
Remember Where CDD Measures are Not Completed?

In case banks are not able to satisfactorily complete required CDD measures;
 Account shall not be opened or any services provided
 If CDD of an existing customer is found unsatisfactory, the relationship should be treated as high risk
 Reporting of suspicious transaction be considered as per law and circumstances of the case
462
Beneficial Owner – Identification and Verification
Reasonable measures shall be taken to obtain information to identify and verify the identities
of the beneficial owner(s) in relation to a customer, using the relevant information or data
obtained from a reliable source.
Where the customer is not a natural person, the banks / DFIs shall:
 Take reasonable measures to understand the nature of the customer’s business and its
ownership and control structure for obtaining information.
 Determine the natural persons who ultimately own or control the customer.
Abbreviated name or title

In case of an account/relationship of an entity with abbreviated name or title, the Banks/DFIs
shall satisfy itself that the subject name / title is in accordance with the constituent document
of the customer entity. Any account / relationship shall not be allowed in abbreviated name in
cases where entity has its complete name (non-abbreviated) in their constituent documents.
463
Do’s and Dont’s-During Due Diligence and Transaction monitoring Process
S/N Do’s Don’ts
1 Verify the nature of business/SOF/occupation in Give response to clear the outstanding alerts/ queries
comparison with the turnover of an account before without conducting due diligence or based on
update the same in KYC info or responding TMU inadequate knowledge about customer business/
alerts source of funds
2 Provide specific reason for high debit / credit Provide incomplete / vague/general /self assumed
turnover in an account reason for high debit / credit turnover
3 Assess the customer to identify source of wealth Update turnover without assurance or based on
and related turnover of an account which should transactions history to dispose off Dash Board alerts
commensurate with legitimate profile of the unless there is plausible reason
customer
4 Provide detailed and fresh information about Avoid using the statement "Already mentioned in KYC"
customer and respective transaction activity or using general/identical/old KYC information
5 Be reasonably assured before getting comfortable Do not give positive confirmation without assurance
for no red flag/ suspicioun
6 Be inquisitive regarding large cash & heavy Do not provide stereotype information for every type
transactions in accordance with customer KYC of customer
7 Purpose of each transaction should be clear & Do not mention provide standalone information such
Specific as Personal/Savings/investments .etc
464
Do’s and Dont’s-During Due Diligence and Transaction monitoring Process
S/N Do’s Don’ts
8 Actual turnover in account exceeds the reasonable Do not update unusually increased expected turn
expected turnover should only be documented in the over without proper rationale and legitimate
KYC section after probing and proper rationale reason/evidence
9 Always try to know & provide ,nature & purpose of Avoid giving one word statement as Investment /
Inward / outward remittance with extra care - property / incomplete / non-conclusive reply
Relationship between remitter and beneficiary is also
very significant
10 Due care should be given if remittance is involving any Don’t just reply as satisfied / self-assumed
high risk country responses / short-answered responses
11 Be always concerned about the evidence of Don’t ignore the significance of evidence of
transaction; always try to obtain evidence of Transaction
transactions or at least view the evidence to satisfy
yourselves regarding transaction genuineness
12 Be questioning with objectivity when counterparties Don’t ignore the significance of counterparty
are not related to customer’s stated KYC account relations
profile/business nature
13 Make sure that all type of transactions are compliant Do not look over the transactions with “NO RISK”
of banking rules/regulations/policy and procedure
465
R2 – Correspondent Banking
 Gather sufficient information about their correspondent banks to understand fully

the nature of their business activities , KYC policy, management & ownership,
jurisdiction , ML and detection measures , purpose of account, etc .
 Establish correspondent relationships with those foreign banks that have effective
customer acceptance/KYC/CDD/AML policies and are effectively supervised by the
relevant regulatory authorities
 Assess the respondent bank in the context of sanctions/embargoes and Advisories
about risks
 Be careful of off-Shore and shell banks
 Attention to be given when continuing relationships with correspondent banks
located in jurisdictions that have poor KYC/CDD standards and payable-through-
accounts
With reference to procedural manual-AML/CFT, FIG approval is required prior opening of

accounts of exchange company , NBFI and schedule bank.
466
R3 – WIRE TRANSFERS/ FUND TRANSFERS
Responsibility of the Ordering Institution
Bank as ordering institution (whether domestic Bank shall include the following information in
or cross border wire transfer and regardless of the message or payment instruction which
threshold) shall; should accompany or remain with the wire
transfer throughout the payment chain:
• Identify and verify the originator
• Obtain details of beneficial owner(s) of funds •The name of the originator This Regulation is not
• Record adequate details of the wire transfer •The originator’s account number (or unique applicable on Domestic Funds
so as to permit its reconstruction reference number assigned by the ordering
• The date of the wire transfer institution where no account number exists) Transfer transactions
• The type and amount of currency involved •The originator’s address, CNIC/passport conducted through
• The value date number ATM, internet Banking & RTGS
• The purpose and details of the wire transfer
• Beneficiary and the beneficiary institution
• Relationship between originator and
beneficiary, as applicable etc
Responsibility of the Beneficiary Institution Responsibility of the

Intermediary Institution
• Beneficiary institution shall adopt risk-based internal policies procedures and
controls for identifying and handling in-coming wire transfers that are not
accompanied by complete originator information
A bank that is an intermediary
• The incomplete originator information may be considered as a factor in institution shall, in passing onward
assessing whether the transaction is suspicious and whether it merits the message or payment
reporting to FMU or termination thereof is necessary instruction, maintain all the
required originator information
• Banks shall remain cautious when entering into relationship or transactions with the wire transfer
with institutions which do not comply with the standard requirements set out
for wire transfers by limiting or even terminating business relationship
467
R4-REPORTING OF TRANSACTIONS (STRs/CTRs)
 Banks shall pay special attention to all complex, unusually large transactions, and all unusual
patterns of transactions, which have no apparent economic or visible lawful purpose.
 Banks, without disclosing the contents of STRs, shall intimate to State Bank of Pakistan on bi-
annual basis the number of STRs reported to FMU.
 The employees of the banks are strictly prohibited to disclose the fact to the customer or any
other quarter that a suspicious transaction or related information is being or has been
reported to any authority, except if required by law. This should made part of Code of Ethics
to be signed by employees and Directors of the bank.
 In case where Banks form a suspicion of money laundering / terrorist financing or any other
criminal activity, and they reasonably believe that performing the CDD process will tip-off the
customer, they may not to pursue the CDD process, and instead file a STR with FMU
 Banks/DFIs shall place adequate number of analysts for monitoring and reporting purpose.
Moreover, steps should be taken by banks/DFIs to develop knowledge and skills of their staff
and utilize technology solutions required for effective monitoring and reporting of suspicious
transactions. **
468
R5-RECORD KEEPING
 Banks shall maintain all necessary records on transactions, both domestic and
international, including the results of any analysis undertaken for a minimum period of
ten years from completion of the transaction
 The transactions records may be maintained in paper or electronic form or on microfilm,

provided it is admissible as evidence in a court of law
 The records of identification data obtained through CDD process like copies of
identification documents, account opening forms, KYC forms, verification documents and
other documents along with records of account files and business correspondence, shall
be maintained for a minimum period of ten years after the business relationship is ended
 Banks shall, however, retain those records for longer period where transactions,
customers or accounts involve litigation or it is required by court or other competent
authority
 Banks shall satisfy, on timely basis, any enquiry or order from the relevant competent
authorities including law enforcement agencies and FMU for supply of information and
records as per law
469
R6-INTERNAL CONTROLS, POLICIES, COMPLIANCE, AUDIT AND TRAINING
Bank’s own AML/CFT policies, procedures & controls
 Formulation of AML/CFT policy/procedures duly approved by Board of Directors
 The policies, procedures and controls shall include, amongst other things, CDD measures,
record retention, correspondent banking, handling wire transfers, risk assessment
procedures, the detection of unusual and/or suspicious transactions and the obligation to
report suspicious transaction etc.
Compliance
 Banks/ DFIs shall incorporate procedures to record and maintain data of account opening
cases rejected by compliance or central account opening units, the cases where
customers’ risk ratings recommended by business units were challenged or revised, and
the cases where accounts were closed based on ML/TF risks. **
 Banks/ DFIs shall Include compliance and AML/ CFT related responsibilities in Key
Performance Indicators (KPIs) of responsible staff down the line, in order to strengthen
the compliance/ AML/CFT function. Moreover, ML/ TF risks should be included in KPIs of
officer(s) responsible for Enterprise Risk Management and Operational Risk Management
functions;
470
Compliance….To be continued
 Banks/ DFIs shall not assign unrealistic business targets and conflicting roles to their
employees. Appropriate strategies may be devised to ensure provision of safe and smooth
banking services;
 Banks/ DFIs shall regularly assess working strength of the compliance function and all its sub-
divisions and deficiency if any, observed should be addressed on priority basis.
Audit
Banks shall maintain an independent audit function in line with Code of Corporate
Governance that is adequately resourced and able to regularly assess the effectiveness of the
bank’s internal policies, procedures and controls, and its compliance with regulatory requirements
Employee Due Diligence

The Banks/ DFIs shall develop and implement a comprehensive employee due diligence
policy and procedure to be implemented/ carried out at the time of hiring all employees
permanent, contractual, or through outsourcing. This shall include but not limited to
verification of antecedents and screening procedures to verify that person being inducted/
hired has a clean history
471
Compliance….To be continued
 Banks/ DFIs shall not assign unrealistic business targets and conflicting roles to their
employees. Appropriate strategies may be devised to ensure provision of safe and
smooth banking services; and
 Banks/ DFIs shall regularly assess working strength of the compliance function and all its
sub-divisions and deficiency if any, observed should be addressed on priority basis.
Training
 Banks/ DFIs shall chalk out and implement suitable training program for relevant
employees on annual basis, in order to effectively implement the regulatory
requirements and banks’/DFIs’ own policies and procedures relating to AML/ CFT
 It is also important to test the capability and knowledge of the relevant staff on periodic
basis. The online trainings and AML/CFT Tests of varying nature are available in the
market offering opportunity for Banks/DFIs to equip their staff with relevant skills as per
respective roles and responsibilities within the institution
472
AML/CFT Guidelines on Risk Based Approach for Banks & DFI’s(SBP)
Banks/DFIs may conduct their internal money laundering and financing of terrorism risk
assessments (for their customers, products & services, transactions channels and geographic areas)
with the purpose to develop their own policies and procedures, in order to identify, assess, manage
and mitigate related risks on ongoing basis.
Customers(High risk factors) Products and Geography or Locations(High risk

Delivery Channels(High risk factors)
factors)
- Non-resident customers - Non-face-to-face -The jurisdictions which

- Customers with links to offshore tax business have been identified for
havens relationships or inadequate AML/CFT
- Customers in high-value items etc Transactions measures by FATF or called for by
- There is a doubt about the veracity or - Cash intensive or FATF for taking
adequacy of available identification other forms of counter-measures
data on the customer anonymous - Countries or geographic
- High net worth customers Transactions areas identified by credible sources
with no clearly identifiable - Private banking as providing
source of income Relationships funding or support for
- Payment received terrorism activities
from unknown or
un-associated third
parties
473
Examples or Characteristics of Suspicious Transactions (Red Alerts)
Transactions which do not make economic sense or inconsistent with

customer’s business or profile
Transactions involving large amounts of cash
Transactions involving locations of concern & wire transfers
Transactions involving unidentified parties
Other suspicious accounts or customers
474
Generators of Criminal Wealth-Money laundering/ Terrorist Financing typologies
Illegal Arm Sales Facilitating illegal immigration
Gun Crimes (Terrorizing) Embezzlement/Frauds

Tax evasion Counterfeiting (including printing of fictitious
currency notes)
Bribery & Corruption Terrorist Activities
Smuggling (including Nukes) Kidnapping for ransom
Drug Trafficking/Human trafficking Trade-based ML/FT- under & over invoicing etc.
Gaming activities (casinos, horse racing, internet Inside trading facilitating

gambling etc.
Use of shell companies/corporations Abuse of NPOs & NGOs
Hawala / Hundi Business Kidnapping for ransom
475
Learning Objective-As a good bank what is our key regulatory & legal obligations ?
 Know our client( KYC)

 Perform appropriate risk-based due diligence on our clients
 Monitor client activity to identify suspicious activities
 Report suspicious activities to the relevant authorities
 Avoid dealing with terrorists and terrorist’s funds
 Abide by laws and regulations
 Educate our staff to enable them to identify suspicious activities and report appropriately
Thank you…….Happy Learning!!
476
13. Foreign Exchange – Regulatory Compliance
477
What is FX Regime?
478
Basic Laws/ Rules
• FERA, 1947.
• FEM 2019.
• FEC.FE Circular No. 08 of 2015.html
• Code.1
• Code.2
• Code.3
• Code.5
• Code. 7
479
Basic Terminology
• Inward Remittances.
• The term 'inward remittance" means purchase of foreign currencies in whatever form and
includes not only remittances by M.T., T.T., draft etc., but also purchase of travellers cheques,
drafts under travellers letters of credit, bills of exchange, currency notes and coins etc. Debit
to banks' non-resident Rupee accounts also constitutes an inward remittance.
480
Basic Terminology
• Inward Remittance – No Restrictions.

• There is no restriction on receipt of remittances from abroad either in foreign currency or by
debit to non-resident Rupee accounts of banks' overseas branches or correspondents.
Authorized Dealers may freely purchase T.Ts, M.Ts, drafts, bills etc., expressed and payable in
foreign currencies or drawn in Rupees on banks' non-resident Rupee accounts. There is also
no objection to their obtaining reimbursement in foreign currency from their overseas
branches and correspondents in respect of Rupee bills and drafts which are purchased by
them under letters of credit opened by non-resident banks or under other arrangements.
481
Basic Terminology
• Outward Remittances.
• The term "outward remittance" means sale of foreign exchange in any form and includes not
only remittances by T.Ts, M.Ts, drafts etc., but also sale of travellers cheques, travellers letters
of credit, foreign currency notes and coins etc. Outward remittance can be made either by
sale of foreign exchange or by credit to non-resident Rupee account of banks' overseas
branches or correspondents. Authorized Dealers may sell foreign exchange for approved
transactions only in accordance with the prescribed procedure.
482
Basic Terminology
• Prescribed Application Forms.

• Form 'I‘ (V-32)
• Form 'T-1‘ (V-68)
• Form 'M‘ (V-7)
483
Mode of Remittances
• Nostro/Vostro.
• Money Transfer.
• Telegraphic Transfer.
• Traveler cheques.
• Credit to non-resident Rupee account of banks' overseas
branches or correspondents.
484
Remittances for Medical Treatment and Studies Abroad
• Remittances for Medical Treatment abroad

• US$ 50,000/- or equivalent in other foreign currencies.
• Medical treatment of resident Pakistanis only.
• Remittances should be sent directly to the account of concerned reputable
foreign Hospital via SWIFT, telegraphic transfer or demand draft.
• V-72 (revised) duly filled in by the patient/next of kin/sponsor.
• Invoice/estimate of the foreign hospital.
• A ‘self-declaration’ from the patient, his/her next of kin or from sponsor
declaring amount of foreign exchange essentially required for treatment
abroad.
• Form. M.
• Purpose Code (1061).
• Swift Message.
485
• Remittances for Medical Treatment abroad

• US$ 5,000/- each to the patient and one attendant which
should be duly endorsed on his/her/their passport(s).
486
• Remittances for Studies abroad

• Accredited and recognized foreign institutions/universities.
• US$ 70,000/- or equivalent in other foreign currencies per
student per calendar year on account of
application/processing charges, tuition fee, living expenses .
• Application/processing charges for admission.
• Students are required to remit application/processing
charges for admission in the foreign educational institutions,
Authorized Dealers may make such remittances to the
concerned foreign educational institution on production of
documentary evidence to the satisfaction of the bank
showing the amount of application/processing charges.
• There is no restriction on the number of institutions to which
a student can apply for admission. 487
• Remittance of tuition fee, living expenses etc.

• Tuition fee, living expenses and other dues (health, insurance, union,
sports, library fees etc.) on behalf of students desirous of studying
abroad who have got admission in a foreign educational institution on
the basis of the following documents:
• Application Form (revised V-82) duly filled in by the student/
parent/guardian.
• Copies of Computerized National Identity Card (CNIC)/Form ‘B’ of the
student and CNIC of the parent/guardian.
• Copy of passport of the student.
• Letter of admission from foreign educational institution.
• Letter/Cost Sheet from foreign educational institution showing break-up
of expenses.
• Form M.
• Purpose Code (1071). 488
• Remittances to the foreign educational institution or the

student.
• Dues, including Tuition Fee, payable to the foreign educational
institution should be remitted directly to the account of the
educational institution via SWIFT, telegraphic transfer or
demand draft and not remitted/released to the student.
• living or miscellaneous expenses as indicated by the respective
foreign institution/ university, if not being remitted to the
institution, can, however, be sent to the student himself via
SWIFT, telegraphic transfer or demand draft.
489
• Initial cash foreign exchange requirements

• In order to meet the initial expenses related to
boarding/lodging and/or other requirements of the student,
Authorized Dealers can release cash foreign exchange
equivalent to US$ 5,000/- to the student which should be
endorsed on his/her passport.
490
• In case of foreign exchange requirements for medical treatment and

studies abroad in excess of the above limits, the concerned
Authorized Dealer will forward the case to the Director, Foreign
Exchange Operations Department, SBP-BSC, Head Office, Karachi
along with justification and documentary evidence for consideration
491
Release of Foreign Exchange by Authorized Dealers for
foreign travel.
• Sale of Foreign Exchange to Pakistan nationals resident in

Pakistan for travel to countries other than India (Stands
deleted vide FE 03/2005), Bangladesh and Afghanistan.
• Pakistan nationals resident in Pakistan.
• U.S. $50/- per day per person.
• Maximum of US$2,100 per calendar year.
• Children below the age of 2 years are entitled to 10%.
• Over 2 years of age but below 12 years are entitled 50%.
• The PTEQ for the period of stay abroad as may be declared
by the applicant on ‘T-1 (V-68)’ form subject to the
prescribed maximum ceiling.
492
foreign travel.
• PTEQ in full at one time or in installments with date, month and year
of issue.
• In cases where passport is presented within one year of its issue and
it bears the endorsement that the holder thereof has previously
traveled abroad on another passport which has been cancelled and
returned, the Authorized Dealers should invariably call for the
previous passport in order to determine the entitlement of PTEQ.
• In case the endorsement shows that the previous passport had been
retained by the authorities after cancellation, Authorized Dealers
may issue foreign exchange on the basis of the written affirmation
by the person concerned about the foreign exchange drawn by him
since 1st January of the relevant calendar year to date.
493
foreign travel.
• Private Travel Exchange Quota can also be released against

one way ticket.
• Prescribed documents .
• Passport
• National Identity Card
• Ticket
• T-1 form duly completed.
• Visa in case of travel by land route.
494
foreign travel.
• Authorized Dealers will keep Photostat copies of the

following documents in their record and present the same to
the Inspection Teams of the State Bank.
• Pages 1, 2 and 3 with inside title page and that page of the
passport on which endorsement of release of foreign
exchange is made
• First coupon of air/steamer ticket
• Visa
495
Private travel by Government Servants, employees of
Semi-Government Institutions/autonomous bodies and
nationalized/taken over institutions/bank
• Foreign exchange released on submission of relevant

order of the competent authority sanctioning leave
ex-Pakistan, in addition to other prescribed
documents.
• Before releasing PTEQ in such cases Authorized
Dealers should ensure that it is clearly indicated in the
Leave Order that the traveler has not been allowed to
draw leave salary / pension in foreign exchange.
496
Restriction as to re-issue of unspent amount of ‘PTEQ’
surrendered to an Authorized Dealer.
• Unspent amount of foreign exchange brought back by a traveler out of the 'PTEQ' drawn by
him and surrendered to an Authorized Dealer can be re-issued to him for subsequent travel
abroad within the approved limits.
497
Travel by journalists/participation in international
conferences/ seminars/ games/ meetings and sports events
etc. in private capacity.
• To attend international conferences, symposia, seminars, meetings etc., in their private
capacity and journalists travelling abroad to cover journalists events etc., will be allowed
foreign exchange by the SBP-BSC (Bank) at the rate of US$60/- per head per day subject to a
maximum of US$1,000/- per head for countries other than India, Bangladesh and
Afghanistan.
• In case of India and Bangladesh foreign exchange will be allowed by the State Bank at the rate
of US$40 per day subject to a maximum of US$600/-.
498
Sale of foreign exchange for Professional Training
• Authorized Dealers may release foreign exchange on

the following scales to persons sponsored by their
respective institutions/organizations in the private
sector for professional training abroad on submission
of the prescribed Application Form (V-70) by the
employing institutions/organizations:
• For the first four weeks
• For Periods extending beyond four weeks.
• For Countries other than India.
• For India.
499
Sale of foreign exchange for Professional Training
• Top level Executives like General Managers, Chief Accountants, Chief

Engineers, Directors, etc.
• Daily Allowance as per scale set out in (V-71).
• US$ 1200 P.M (1st 4 weeks).
• US$ 500 P.M (beyond 4 weeks).
• Junior Executives.
• US$1200 P.M (1st 4 weeks).
• US$ 250 P.M (beyond 4 weeks).
500
Foreign exchange for Tabligh
• Release of foreign exchange over and above the private travel exchange quota (PTEQ) for
Tabligh requires State Bank's prior approval.
501
Release of Exchange for Miscellaneous purpose
• Authorized Dealers may release US$ 50 per head for meeting

incidental expenses to the travelers of the following categories,
proceeding to countries other than India, Bangladesh and Afghanistan
on submission of passport and ticket. This will be in addition to any
other purchase of foreign exchange admissible to them except Private
Travel Exchange Quota.
502
Exchange Quota to Government/Semi-Government
Employees going on Delegations, Duty, Posting, Leave,
Retirement and Training.
• Government/Semi-Government employees will be entitled to draw exchange at the
prescribed rate of daily allowance which has been fixed by the Government for the actual
period they remain abroad on official duty.
• In addition, an exchange quota of US$100/- per person will be allowed on private account, if
so requested by the person concerned provided he has not been allowed to draw his salary
abroad.
• Persons who are eligible to draw leave salary/pension in foreign exchange may, while
proceeding abroad on leave or after retirement, either draw the private travel quota or leave
salary/pension as admissible under Government rules.
503
Migration.
• Persons proceeding on migration abroad will be allowed by the State Bank a foreign exchange
quota of US$50/- per head against sponsored migration visa and US$500/- per family against
non-sponsored visa.
• Migrants to USA/Canada against non-sponsored visa will be allowed a compulsory minimum
quota of US$260/- per family. They may at their option also obtain additional exchange quota
up to US$500/- inclusive of the compulsory quota.
• Application for the purpose should be made on the prescribed form (V-73).
504
Business Travels Abroad.
• Persons proceeding abroad on business visits are allowed exchange facility at the rate of
US$300/- per day subject to a maximum of US$9000/- per person for countries other than
India and Afghanistan. For India business travel quota is allowed @ US $40/- per day subject
to a maximum of US$1,200 /- per person.
505
Booking of passage/release of exchange for business visits
abroad on the basis of Certificates of Trade Organizations.
• Airlines/Shipping Companies/Travel Agents and Authorized Dealers may issue tickets and
release foreign exchange at the rate specified in the previous slide without prior approval of
the State Bank in accordance with the following instructions in cases where business visit to
countries other than Afghanistan is recommended by the Federation of Chamber of
Commerce and Industry or by a Chamber of Commerce/Trade Organization listed in V-73.
506
Booking of passage/release of exchange for business visits
abroad on the basis of Certificates of Trade Organizations.
• Persons desirous of proceeding abroad on business visits under the above scheme should fill
in Form "T-2" (Appendix V-75) in triplicate and submit it to one of the Organizations
mentioned in the list for certification. Two copies of Form "T-2" will be returned to the
applicants after certification and the third copy retained by the Chamber of Commerce/Trade
Organization for their own record.
507
Booking of passage/Release of foreign exchange to representatives of
Consultancy/ Constructions companies and firms.
• Authorized Dealers may release foreign exchange at the rates specified in BTEQ without prior
approval of the State Bank to the representatives of Consultancy/Construction
firms/companies whose Bid Bonds/Performance Bonds have been accepted by foreign
beneficiaries.
• For this purpose, such persons/firms, if they are not members of any Chamber of Commerce
and Industry or Trade Organization, will be required to fill in Form 'T-2' in triplicate and
submit it to TDAP for certification.
• However, in case the Consultancy /Construction firm/company is a public sector company,
passage/exchange facility will be available only with the prior approval of State Bank of
Pakistan.
508
Release of Exchange to Pakistani exporters for participation
in International Trade Fairs/Exhibitions in Private Capacity
• Category ‘A’ where sample goods are taken for display
• Remittance of space rent direct to Fair/Exhibition authorities against their debit note and
undertaking from the exporter's firm/company on the form appearing at V-76. Remittance
will be reported on Form 'M'.
• Release of exchange for construction of pavilion against estimate subject to rendition of
account for expenses incurred and undertaking on the form appearing at V-76. Remittance
will be reported on Form 'M'.
509
Release of Exchange to Pakistani exporters for participation in
International Trade Fairs/Exhibitions in Private Capacity
• Release of exchange will be reported on T-1 Form under this authority.

• Payment for the cost of ticket and foreign exchange to be released for payment of rent for
stalls, booking of space, construction of pavilion, advance deposits etc. and for the expenses
of the representative of the firm/company participating in international trade fairs /
exhibitions will be received by the Airlines/Travel Agents/Shipping Companies and Authorized
Dealers through cheques drawn on the bank account of the firm/company concerned.
510
• Category 'B' - Trade Fairs/Exhibitions organized by the Chambers of Commerce and Industries
(of Pakistan) or where exporter is participating in individual capacity where goods are taken
for sale under Form 'E' procedure.
• Remittance of Advance space rent by the Chamber of Commerce and Industry direct to Fair
authorities against Debit Note supported by (a) list of participating members with their share
of space rent and (b) undertaking in (V-76) from each member participating in the fair.
Remittance will be reported to State Bank on Form 'M'.
• Certification of Form 'E' on self consignment basis or otherwise as recommended by the
organizing Chamber of Commerce and Industry.
• Issue of an authority letter to airline/travel agent for the issue of ticket to and from the
country where the Fair is being held, for not more than two persons of the participating firm
on whose behalf Form 'E' has already been certified, on (V-77).This authority letter will be
retained by the airline for submission through passage statements.
511
• Release of foreign exchange for Duty/Sales tax to the participating

members on repatriable basis as per undertaking furnished on Form (
V-76). This will be reported on T-1 Form along with Business Travel Quota.
• Release of foreign exchange to the representative(s) of the participating
firm/Pavilion Officer(s) on production of return air tickets purchased
against Authorized Dealer's authority mentioned in preceding sub-
paragraphs (iii) and (iv), at a rate not exceeding the Business Travel Quota
for the number of days of the Fair plus 7 days extra for setting up stall and
winding up of affairs but not exceeding 30 days. This will be reported on
T-1 Form under this authority.
• Issue of authority letter for re-import of unsold goods exported under
Form 'E' procedure as per preceding sub-paragraph (ii) on freight-to-pay
basis. Original will be retained by the airline/shipping company and photo-
copy will be produced to Customs for release of the goods.
512
Release of Exchange to Pakistani exporters for participation
in International Trade Fairs/Exhibitions in Private Capacity
• Authorized Dealers should carefully note that in case of failure of the

participants to submit evidence of having brought back the sample
goods taken for display or encashment certificate of the samples sold
and for failure to repatriate the foreign exchange released for space
rent/duty etc., along with the sale proceeds (Category B) the
Authorized Dealers will report the matter to the area office of the
Exchange Policy Department of the State Bank for suitable action.
• The Authorized Dealers will also report the outstanding sale proceeds
including the amount released on account of space rent/duty etc. in
their monthly overdue statement prescribed in V-20 of the Manual
with specific remarks "Exhibition case".
513
Business Travel abroad with SBP approval
• Persons desirous of proceeding abroad on business visits are free to approach the State Bank
for approval of passage facility and release of exchange for such visits.
• Applications for this purpose should be made to the State Bank on Form "T" (V-78).
• At the time of forwarding such applications duly completed, Authorized Dealers should
ensure that the requisite documents including a Confidential Report on the financial standing
of the party are enclosed with the application.
514
Blanket permission for business travel abroad to exporters of Commodities, services etc.
• State Bank also issues blanket permission for purchase of ticket and release of foreign
exchange for business travel abroad to exporters of commodities, services etc. whose export
earnings during the preceding calendar year or the year immediately preceding the month of
the application are Rs 2.5 million or more in the case of exporters of commodities and Rs 0.25
million or more in the case of exporters of services like Indenting/Recruiting Agents,
Construction Companies, Trade Marks and Patent Attorneys etc.
• Request for issue of blanket permission should be made to the State Bank on Form "BT" (V-79
) in duplicate. Names of the Directors/Executives/Officials who would undertake business
travel on behalf of the applicant firm against the blanket permission will be specified in the
application. Not more than 3 persons can be nominated at a time for this purpose.
515
Combination of two exchange facilities.
• Authorized Dealers should not release foreign exchange for two

different purposes at a time. In other words combination of two
exchange facilities is not allowed.
516
Conversion of Unspent Balance of Rupees by Foreign Nationals.
• Authorized Dealers may allow conversion into foreign exchange of the unspent amount,
without any limit, left with the foreign tourists out of proceeds of foreign exchange encashed
by them in Pakistan with an Authorized Dealer.
• Re-conversion facility will be provided on production of encashment certificate (V-9) by the
foreign tourist or on the basis of endorsement recorded on his passport by an Authorized
Dealer at the time of purchase of foreign exchange. The relative encashment certificate or
copy of the relevant pages of passport shall be submitted to the State Bank along with the
monthly returns.
517
Endorsement on Passports and Tickets.
• The amount of exchange sold by the Authorized Dealers together with the date on which the
sale is made must be recorded on the traveler’s passport under the stamp and signature of
the Authorized Dealer at the time the sale is made.
• The endorsement should be made on the special pages provided for the purpose.
• The exchange issued should also be endorsed on the first page of ticket jacket as also back
side of the passengers’ coupon and a hole punched in the upper right hand corner of the
passengers air/steamer ticket.
• Authorized Dealers should not sell any exchange unless a person holds a ticket for departure
on a definite date and that such a date is not later than two weeks from the date on which
the exchange is issued.
• No exchange should be sold against tickets which do not specify the date of departure
provided that these instructions do not apply if a person is travelling by land route where only
the passport will be endorsed.
518
Form in which Exchange may be issued.
• The release of admissible Private Travel Exchange Quota to the travelers proceeding abroad in
the shape of foreign currency notes will be restricted to US$100 only. The balance amount of
admissible quota will be released in the shape of travelers cheques duly branded with rubber
stamp as stipulated in the preceding sub-para. (FE-22 of 2002)
519
Surrender by Travelers of Unspent Foreign Exchange.
• Attention of the all persons granted foreign exchange for travel abroad should be drawn by
the Authorized Dealer to sub section (3) of Section 4 of the Act.
• No person who acquires foreign exchange for travel can use it for a purpose other than for
his living or travelling expenses in the country for which exchange is issued.
• In the case of special allotment made by the State Bank, the exchange can be utilised only for
the purpose for which it is sanctioned.
• All unspent amounts of foreign exchange should be sold to an Authorized Dealer by the
traveler immediately on his return to Pakistan.
• If so desired by the person concerned, the amount of foreign exchange thus surrendered may
be endorsed on his/her passport.
520
Exchange for Hajj
• The Government of Pakistan announces each year the scale on which

foreign exchange will be released to intending pilgrims to Saudi
Arabia. Foreign exchange may be released by the designated
Authorized Dealers to intending pilgrims in the form and on the
scales and in accordance with the special instructions and conditions
laid down by the Government for different categories of pilgrims .
521
Remittances for maintenance expenses of the families of
Pakistanis living abroad temporarily.
• State Bank considers requests for allowing remittances in foreign
exchange on account of living expenses of families of Pakistani nationals
living abroad temporarily for some genuine personal reasons may submit
the following documents :-
• Application from Pakistan national resident in Pakistan indicating the
purpose for which the family went abroad and the reason for its
continued residence abroad and the probable period of stay abroad.
• A certificate from Pakistan Embassy/High Commission in the concerned
country confirming the reason of stay abroad of the family, expected
period of stay, the number of persons in the family and the amount
required per month for maintenance. The certificate should confirm that
the concerned persons hold Pakistani passports
522
(Added vided vide FE-03/ 2002 and amended vide FE
22/2002)
• ‘Authorized Dealers may issue foreign currency travellers’ cheques to foreign nationals and
Pakistani nationals (residents and non-residents) up to the limit prescribed under Para 10(f)
Chapter XVIII of the Foreign Exchange Manual (Eighth Edition) against surrendering of an
equivalent amount of foreign exchange in cash’.
523
Operating Expenses of Pakistani Shipping
Companies/Airlines.
• Pakistani shipping companies and airlines are required to submit to S.D. W. D. a monthly
statement of their earnings and expenditure at foreign ports in the prescribed forms (V-50 and
V-51) supported by passage/ freight manifest for receipts and by vouchers in respect of
payments at sdsa@sbp.org.pk by 18th of the following month.
• They can make disbursements in respect of approved transactions only out of their receipts at
foreign ports and they are under obligation to regularly repatriate the excess collections, if any,
to Pakistan and attach the bank encashment certificates with the statement.
• In case the collections fall short of the disbursements, the shipping companies/airlines should
make an application to the State Bank for remittance of the deficit or for meeting bonafide
individual items of disbursements like crew wages, bunkering charges, port dues, food charges
etc.
• Applications for repair of ships/aircrafts and purchase of durable stores other than food
provisions should, however, be routed through the Ministry of Communications in the case of
shipping companies and the Ministry of Defence in the case of airlines.
524
Charter of Foreign Ships and Aircrafts
• Ship owners, charterers and operators and/or owners, charterers, and operators of all floating
crafts including tugs, dredgers, survey vessels and other specialized crafts may open and
operate foreign currency accounts in Pakistan.
• These accounts for both receipts and payments of foreign exchange. Such foreign currency
account holders may retain their surplus earnings in these accounts and shall surrender the
same within three months of closing of the financial year. Foreign partners in Pakistan based
Joint Venture companies may receive their share of profits after tax. Operation of such
account will be subject to the following conditions:
1. Cash deposits and cash withdrawals from these Accounts will not be permitted.
2. All reporting requirements that are applicable for existing Foreign Currency Accounts
maintained by the Shipping Companies abroad would also be applicable to those special
Foreign Currency Accounts.
3. All withdrawals in Pak Rupees will be at Interbank Rate.
525
Remittance of Freight Charges by Freight Forwarder/ Consolidators

•Authorized Dealers are allowed to remit on a monthly basis, the surplus freight by the Freight Forwarder/
Consolidators, after verification of documentary evidence in support of the remittance subject to the
following on monthly basis:
•Clients letter, indicating purpose of remittance, particulars of the beneficiary and beneficiary’s bank
•Agency Agreement with counterpart abroad (Annually)
•NTN and PIFFA Membership Certificates (Annually)
•Certificate from a practicing Chartered Accountancy firm to the effect that the amount of remittance applied
for has been verified with reference to authenticated copies of prepaid Master Airway Bill / Master Bill of
Lading with the related House Airway Bill / House Bill of Lading, cargo manifests and billed invoices from
counterparts abroad, and had been found correct.
•M - Form
•Statement of Freight Collected and/or Payable Abroad Against Shipments Made During the Month (Annexure
– I)
•Statement of Freight Payable against Imports on Consolidated Basis by Air/ Sea during the month (Annexure
- II)
•Monthly Statement of Air/Sea Cargo Consolidation (Annexure – III)
526
Remittances on account of lease rentals by the Airlines
incorporated in Pakistan
• Authorized Dealers can make remittances on account of lease rentals by the Airlines
incorporated in Pakistan upto the guaranteed hours.
• Amount exceeds the guaranteed hours, ADs would refer the case to the Director, FEOD, SBP
Banking Services Corporation for necessary approval by submitting the following documents:
• Attested copy of valid agreement.
• Original invoices
• An audited statement showing the opening balance, earning, expenditure and net amount
(surplus/deficit).”
527
Remittance of Royalty/Franchise and Technical Fees
• Royalty and Technical Fee in the Manufacturing Sector defined as

under:-
• Definition of Royalty: Royalty is a fee paid by a local firm to the
foreign collaborator in consideration of “License to use the foreign
manufacturers’ patent/brand name for marketing the product(s).”
• Definition of Technical Fee: It is a fee paid by the local firm to the
foreign collaborator.
528
Royalty/Franchise/Technical Fee or Service Charges in Agriculture,
Social, Infrastructure and Service Sector including international
food Chains
• The initial lump sum fee payable to the foreign investor/the party
providing technical expertise and/or allowing use of their brand name,
should not exceed US$ 100,000/- irrespective of the number of outlets
under one franchise.
• A maximum of 5% remittance of net sales (excluding sales tax) in the
food sector may be allowed as Franchise Fee only for those items, which
are core items of the franchise and are the specialties of the trade name.
• The payment of such fees will be allowed on monthly basis. No item will
be eligible for twice payment of Royalty/Franchise Fee. In other words,
the payment of Royalty/Franchise Fee shall not be admissible for those
items whose franchise is not held by the food chains and/or which are
sold under some other brand name e.g. soft drinks etc.
• Initial period 5 years beyond SBP approval.
529
Royalty/Franchise/Technical Fee or Service Charges in Agriculture, Social,
Infrastructure and Service Sector including international food Chains
• Designate any of the Authorized Dealers.

• Agreement will be registered with SBP within 30 days ( V-52).
• SBP acknowledged agreement.
• Remittances made on (V-53 triplicate+ SBP registration+ Tax).
• Reporting to EPD.
• Authorized Dealers will maintain company-wise record of remittances allowed by
them on the above account so as to facilitate inspection by the State Bank’s
Inspection Teams.
530
The remittance of Royalty/Franchise and Technical Fee or Commission/Service Charges for the financial
sector
• The application along with attested copy of the agreement and other relevant
information/documents in respect of branded financial products/services within the area of
authorized business, would be processed and approved by the FEOD , on a case to case basis.
• The one time lump sum upfront Royalty/Technical Fee/Franchise Fee should not exceed
US$500,000/-. This would be allowed from the inter-bank market.
• Continuing royalty payments, service/technical charges/commission or handling charges/any
other directly related charges not exceeding 0.25% in aggregate of customers’ billing net of
taxes/surcharges would be allowed which would either be recovered from the customers or met
through the financial institution’s own resources. No foreign exchange would be provided/
utilized for this purpose from the inter-bank market.
• Permission for standby LC/guarantee, if required, would be granted on the merit of each case.”
531
Technical Services and Consultancy Agreements and Engagement of Foreign
Technicians.
• Foreign experts/technicians may be employed by the local firms in private sector without
requiring approval by any Government agency for rendering such technical services as
supervision of installation, commissioning of plant and training of personnel.
• Authorized Dealers may accordingly allow remittances for engagement of foreign
experts/technicians to foreign firms or establish letters of credit available for payment of such
charges on production of beneficiary’s service invoices/bills duly certified by the employers in
Pakistan. While reporting to the State Bank the remittances effected under this facility in the
monthly foreign exchange returns, the Authorized Dealers will attach the following
documents with relative Form ‘M’:-
532
Technical Services and Consultancy Agreements and Engagement of Foreign Technicians.
• Foreign experts/technicians may be employed by the local firms in private sector without
requiring approval by any Government agency for rendering such technical services as
supervision of installation, commissioning of plant and training of personnel.
• Allow remittances for such charges on production of beneficiary’s service invoices/bills duly
certified by the employers in Pakistan.
• While reporting to the SBP the remittances effected under this facility in the monthly foreign
exchange returns, the A.Ds will attach the following documents with relative Form ‘M’:-
(a) Copy of the service agreement entered into with the foreign firms.
(b) Beneficiary’s service invoices/bills duly certified by the employers in Pakistan.
(c) Authorized Dealers to ensure that income tax has been correctly deducted from the
amount payable to the foreign beneficiaries and paid to the income tax authorities or
exemption certificate from the income tax authorities is called and recorded.
533
Remittances by Information Technology Sector.
• Authorized Dealers are hereby granted general permission to release foreign exchange up to a
maximum of US$ 100,000/- or equivalent in other currencies per invoice for private sector
companies incorporated in Pakistan, for payments on account of utilization of Information
Technology services, after satisfying themselves with the genuineness and bonafides of the
requests through invoices, Government approvals/NOCs/licensing or certifications wherever
so required as per the instructions in Foreign Exchange Manual, and after deducting all
applicable taxes.
534
Remittances by Information Technology Sector.
List of eligible items:-

i) Satellite Transponder charges.
ii) International Bandwidth charges.
iii) International Internet service charges.
iv) International Private Line charges.
v) Software licence/maintenance & support fees for proprietary/ specialized
software.
vi) Subscriptions/payments for access to foreign electronic media & databases.
• The above remittances required a bank designated by FEOD.
535
Remittance of Profits by Foreign Banks/Companies.
• Approved by SBP subject to:-

a) Audited Balance Sheet and Profit & Loss Account of the branch(es) in Pakistan.
b) Tax provision made during the year for (a) the current year and (b) for the prior years along
with its computation.
c) A certificate from the auditors in Pakistan that tax provision made in the accounts is
sufficient to meet all tax liabilities in Pakistan, or copies of final assessment orders and forms
duly certified by the Income Tax Department.
d) Assessment orders for the previous years, if not submitted earlier to the State Bank.
e) Certificate from the auditors showing the liability for staff gratuity as at the close of
accounts and provision made there-against. If no provision has been made, reasons thereof.
536
Remittance of Profits by Foreign Banks/Companies.
f) Details of other/miscellaneous income.

g) Amount charged/claimed on account of Head Office expenses for the current year (if not
separately shown in the accounts) and the basis of its calculation along with Head Office
expenses claimed/allowed by the Income Tax Authorities for the preceding 3 years.
h) Provision made in the current year for classified assets.
i) Confirmation to the effect that the amount provided for classified assets is not less than the
amount required to be provided on the basis of the Prudential Regulations of the State Bank.
j) Item-wise details of un-realized/accrued income credited to Profit & Loss Account for the year
and in the previous year.
k) Item-wise details of un-realized/accrued income of the previous years realized in the current
year.
537
Payment of Dividend to Non-Resident Shareholders.
• Allow remittance of dividends to non-resident shareholders without the prior approval of the
State Bank.
• Designate an Authorized Dealer through whom it proposes to remit dividends to its non-
resident shareholders otherwise SBP approval require.
• Each company which wants to avail of the facility of making remittance of dividends without
the prior approval of the State Bank, should advise the Joint Director (Investment Division),
Exchange Policy Department, State Bank of Pakistan, Karachi the name of its bankers through
whom it would like to make remittance. On receipt of nomination of a bank from the
company, the State Bank will authorize the bank concerned to effect remittance of dividends,
whether interim or final, to the non-resident shareholders of the company without its prior
approval.
538
Payment of Dividend to Non-Resident Shareholders.
Before remittance of dividends, A. D. must ensure:

a) that the shares are held by the non-residents (other than Indian nationals) under the
specific and/or general permission of the State Bank and are registered at their foreign
addresses,
b) that the shares in question were not acquired by the non-residents on the basis of their
undertaking that they will not claim remittance of dividend and,
c) that the application for remittance of dividend is net of Pakistan tax liability. Authorized
Dealers must also ensure that the auditor’s certificate to this effect on the application is from
a well-known firm of auditors.
539
Foreign Articles in Pakistani Newspapers and Magazines.
• Allow remittances at actual, without prior approval of the State Bank, in respect of articles
contributed by non-resident foreigners for publication in Pakistani Newspapers or Magazines,
provided a demand note from the non-resident contributors is produced by the publishers of
the article to the Authorized Dealers while applying for remittance.
• Advance remittance may also be allowed subject to the applicant’s undertaking to submit the
requisite documents in due course.
540
Advertisements in Newspapers and Magazines abroad.
• Allow remittances for advertisement charges payable to newspapers, magazines, etc., abroad
without the prior approval of the State Bank on production and examination of the following
documents:-
(i) Form ‘M’ signed by the applicant.
(ii) Invoice/Bill etc., of the beneficiary in original.
(iii)Undertaking from the applicant concerned that he will produce relevant clippings from the
newspaper/magazine to them within a period not exceeding three months. These clippings
will be retained by the Authorized Dealers for inspection by State Bank’s Inspectors.
541
Bank Charges and Sundries.
• Authorized Dealers may, without prior approval of the State Bank, effect remittances to their
foreign correspondents etc., to cover payments due to them on account of bank charges, cost
of cables and other incidental charges arising in the normal course of authorized business
other than imports. All such remittances should be reported to the State Bank on Form ‘M’.
• In cases where bank charges relating to exports are paid by the Authorized Dealers to their
foreign correspondents by deduction from the amount of the export bills, they should report
the full amount of the export bill as “Purchase” and simultaneously report the deduction as
“Sale”.
542
Purchase of Tender Forms from abroad.
• Authorized Dealers may allow remittances on account of fees for tender forms payable to
Government/Semi-Government agencies or a private company or a firm abroad without the
prior approval of the State Bank on receipt and examination of the following documents:
i) Form ‘M’ duly filled in and signed by the applicant.
ii) Newspaper clipping/Pakistan/Foreign Embassy’s letter or other supporting documents
evidencing floatation of tenders and the cost of tender documents.
543
Registration of Patents and Trade Marks in Foreign
Countries.
• Authorized Dealers may allow remittances covering fees etc., for registration of patents and
trademarks in foreign countries by firms/companies etc., in Pakistan without prior approval of
the State Bank on receipt and examination of the following documents:
a) Form ‘M’ duly signed by the applicant.
b) Debit Notes of the patent attorney/solicitors etc., for the fees for registration of
patent/trade mark.
c) Undertaking from the remitter to produce within one month from the date of remittance
evidence to the effect that the patent/trade mark has been registered abroad.
544
Registration of Exporters of Pharmaceutical products in Foreign
Countries.
• Allow remittances of registration fees by exporters of pharmaceutical

products in Pakistan for their registration with the Ministry of Health
of a foreign country, without the prior approval of the State Bank, on
production of the following documents:
a) Form ‘M’ duly signed by the applicant.
b) Evidence from the Ministry of Health of the foreign country
concerned demanding payment of registration fee.
c) Undertaking from the remitter to produce within 1½ month from
the date of remittance, evidence to the effect that the applicant has
been registered with the Ministry of Health of the foreign country
concerned.
545
Transfer of Assets-Foreign Nationals retiring form Pakistan.
• Should be referred to the State Bank in the prescribed form (Appendix V-62) along with
Form 'M‘ and other prescribed documents.
546
Sale of imported vehicles.
• Remittance of sale proceed of imported vehicles of Foreign

Diplomatic Missions, Diplomatic Officers, privileged persons/
organizations, foreign nationals/contractors/ firms etc., doing
business or employed in Pakistan, which have been imported into
Pakistan for official or personal use, subject to State Bank approval.
547
Legacies and other Distributions of Assets from the Estate
of Deceased Persons.
• Applications covering remittance of legacies and other distributions

from estates of deceased persons due to beneficiaries resident
outside Pakistan should be referred to the State Bank for
consideration.
548
Family Remittance Facilities.
• Foreign nationals, who are resident in and have income in Pakistan,

are permitted to make remittances to the country of their domicile
out of their current savings, to cover their commitments for family
maintenance, insurance premia, educational expenses of their
children, legal charges, mortgage payments, loan, interest etc.
• Such remittances can be made to the extent of the difference
between the net income of the applicant and his estimated expenses
in Pakistan, as declared by him in the prescribed application form.
• This facility is, however, not available to Indian and Afghan nationals
and foreign-born wives of Pakistan nationals.
549
Issue of Permits.
• Permits for monthly remittances may be issued by the Authorized Dealers, without the prior
approval of the State Bank, to foreign nationals other than those who are:
• a) Self-employed, or
• b) employed in Merchant Navy, or
• c) of Indo-Pak origin.
• Permits will be issued on receipt of declaration from foreign nationals in the prescribed form (
Appendix V-63) in duplicate and subject to fulfillment of the prescribed conditions.
550
Family Remittance Facilities-Self-employed Foreign
Nationals.
• In the case of self-employed foreign nationals e.g., doctors, lawyers,

architects, consultants etc., remittance permit will be issued by the
FEOD( V-63).
551
Subscription to Foreign Magazines, Periodicals etc. and Purchase of Books of a Learned or
Technical Nature.
• Allow remittances, without prior approval of the State Bank, for subscription to foreign
magazines, periodicals, newspapers etc., and for purchase of books of learned and technical
nature as per ceiling prescribed in the Import Policy.
552
Remittances by Book-sellers/Subscription Agencies on account of
Subscription to Foreign Journals and Magazines etc.
• Authorized Dealers may allow remittances by book-sellers/subscription agencies on account
of subscriptions collected by them from their individual customers for subscription to foreign
newspapers/journals/magazines and import of books of technical and learned nature.
553
Membership Fees of Educational, Technical, Professional & Scientific Institutions.
• Authorized Dealers may approve applications on Form 'M' covering subscriptions or

membership fees at actuals to bonafide scientific, technical, professional and educational
institutions abroad. The applications should contain the following particulars:
• (i) Name and address of the institution.
• (ii) Amount of subscription payable.
• (iii) Period for which subscription is valid.
• Remittances should be made directly in the name of the scientific, technical, professional and
educational institutions abroad.
• This will also be available to institutions/professional bodies in Pakistan with international
affiliations.
554
Membership Fees of Bonafide Social Clubs etc.
• No foreign exchange will be made available for this purpose.
555
Correspondence Courses.
• Authorized Dealers may approve remittances for payment of fee for correspondence courses
in actuarial science and for those other courses which prepare students for examinations
conducted in Pakistan by professional institutions of repute abroad like ICWA etc.
• Applications for the purpose should be made on Form 'M' duly supported by a declaration in
the prescribed form (Appendix V-65) and the demand note received from abroad.
556
Method of Reporting the Remittances allowed by
Authorized Dealers under the above Authority.
• Authorized Dealers will bunch Forms 'M' under each category separately
along with the prescribed supporting documents in each case on the
basis of which the remittances in question have been effected.
• Each bunch of Forms 'M' with the relative documents must have a
covering statement in duplicate as per proforma given below:-
• Covering Statement in respect of Remittances allowed during the
month..…...…….......…… for ………...............….
• Sl.
No.
• Name of the remitter.
• Name & address of beneficiary.
• Amount remitted in foreign exchange.
• Equivalent in Rupees. 557
14. Foreign Account Tax Compliance Act (FATCA)
558
Course Objective
 The aim of this module is to bring awareness in UBL staff about FATCA requirements
 To familiarize staff with FATCA and its implication
 Advise staff for their roles and responsibilities with regards to Due Diligence requirements
 Identification of US Persons based on US Indicia/(evidence)
 Remediation Process
 Dealing with Recalcitrant Customers
559
Orientation to FATCA
The Foreign Account Tax Compliance The act obliged Financial Institutions/Banks
FATCA is intended to prevent
Act (FATCA) is a U.S. efforts to improve to enter into an agreement with the Internal
"U.S. persons" from evading
tax compliance involving foreign Revenue Service(IRS)(a US tax authority) and
U.S. tax using financial
financial assets and offshore accounts. report all their US clients.
accounts held outside of the
Legislation signed into law on March UBL is registered with IRS as a Participating
United States.
18, 2010 Bank.
All new customers will have to be

on-boarded as per FATCA
All existing accounts to be searched to
requirements. It means that their
establish FATCA status of the customer.
FATCA status need to be determine
at the time of opening account.
FATCA Compliance:
• Identify US Person (account holder, joint account holder, mandate holder or beneficial owner, substantial US owners i.e.
more than 10% in voting and value of shares collectively or singly);
• Complete documentation and inform Compliance Group HO; and
• Do not help customers to avoid FATCA requirements.
560
Key Terms
Internal Revenue Service (IRS)

The Internal Revenue Service (IRS) is the U.S. government agency responsible for tax collection and tax law enforcement.
Participating FI
As per FATCA requirements Banks/FI that has agreed to comply with requirements of an FI agreement. All Pakistani banks, including
UBL, are Participating FIs in terms of SBP directives. An IGA (Intergovernmental Agreement) will be signed in future.
Financial Account
Any depository or custodial account or equity/debt interest in a financial institution/banks.
New account (For FATCA purpose)

• Individual or Sole Proprietorship Accounts opened on or after July 1, 2014. Legislation effective from 30 th June 2014.
• Entity accounts opened on or after Jan 1, 2015
Financial Institution (FI)
Any entity that (i) accepts deposits in the ordinary course of a banking or similar business; (ii) holds as a substantial portion of its
business financial assets for the account of others; or (iii) is engaged (or holding itself out as being engaged) primarily in the business
of investing, reinvesting, or trading in securities, partnership interests, commodities or any interest (including a futures or forward
contract or option) in such securities, partnership interests, or commodities.
Indicia
A U.S. legal term meaning indication. In the context of FATCA, indicia refer to evidence or indications that an account holder might be a
U.S. person. 561
Key Terms
U.S. Indicia
U.S. citizen or resident;
A U.S. place of birth;
A current U.S. residence address or U.S. mailing address;
A current U.S. telephone number
Standing instructions to pay amounts from the account to an account maintained in the United States;
A current power of attorney or signatory authority granted to a person with a U.S. address; or
 An “in-care-of” address or a “hold mail” address that is the sole address the FFI/bank has identified for the account holder.
Potential US person
Potential US Person is an individual having account with documentation containing any US Indicia which indicates that person might
have a link to US. In this scenario, additional documents (US Tax Forms) must be obtained from customer.
U.S. person
1. US Citizens (including dual citizen)
2. US residents
3. US Green Card holders
U.S. account
U.S. Account is any financial account maintained by a bank that is held by one or more U.S. persons, U.S. entities or Passive NFFEs
with a U.S. substantial owner. 562
Key Terms
Recalcitrant account holder

Any account holder that fails to comply with requests by the Participating Financial Institution (PFI)/bank for the documentation or
information that is required for determining the status of such account as a U.S. account or other than a U.S. account or if foreign law
would prevent reporting by the PFI on information with respect to such account, the account holder fails to provide a valid and
effective waiver of such law to permit such reporting.
Beneficial Owner (BO)
The person who is the owner of the income for tax purposes and who beneficially owns that income. Thus, a person receiving income
in a capacity as a nominee, agent or custodian for another person is not the beneficial owner of the income. Next of Kin should not be
considered as Beneficial Owner (BO).
Active NFFE
The term 'Active NFFE' generally refers to an entity that operates an active trade or business other than that of a financial business.
Less than 50 percent of its gross income for the preceding calendar year is passive income and less than 50 percent of the assets held
by the NFE produced or held for the production of passive income.
Pre-existing account (For FATCA Purpose)
•Individual or Sole Proprietorship Accounts held as on 30 th June 2014
• Entity accounts held as on 31st December 2014
563
FATCA Requirements for Individual or Sole Proprietorship Customer
Form W9 is mandatory to be obtained from customer if:

• Customer holds U.S. Permanent Resident Card (Green Card);
• Customer`s current country of residence is United States; or
• Customer is a U.S. National.
Form W8-BEN is acceptable if:

• Customer has withheld/(withdraw) the U.S. nationality or residency. In this case, along with W8-BEN form, it is
mandatory to obtain Certificate of loss of nationality i.e. DS-4083 or Certificate of loss of residency i.e.
I-4097(whichever is applicable) from customer.
• In the case where customer has provided U.S. address or contact number and claimed that he is not a U.S.
Person, he should submit W8-BEN form along with the documentary evidence i.e. Government issued identity
document evidencing non-US nationality (for e.g. CNIC etc.).
The above information must be screened for each holder of an account in-case of Joint Account, beneficial owner if
other than the customer and mandate holder of an account.
If customer refuses to provide required document or information, as per approved FATCA Policy,
NO relationship will be initiated with that customer.
564
FATCA Requirements for Non-Individual Customer
Financial Institutions Account

If customer is a ‘Financial Institution’, (Bank/NBFC/DFI/Leasing Companies/ Modaraba Companies) at the time of
account opening, completely filled, signed and dated W8-BEN-E Form must be obtained from customer along with
AOF and other required documents.
If customer refuses to provide required document/information or is a Non-Participating FI as per provided W8-BEN-

E Form, NO relationship will be initiated with that customer as per FATCA policy.
Non-Financial Entity (NFE) Account

If customer is not a Financial Institution, branch staff to ensure that ‘FATCA Form for NFE’ and other required
documents (as mentioned in the form) must be obtained by the customer. Branch should also ensure that all
documents and forms must be correctly filled, signed and dated by customer and submitted to the branch along with
AOF.
Branch to ensure following:
• If an entity is a publicly listed Company or an affiliate of a publicly listed Company, name of Exchange on which the
company is listed must be provided.
• If an entity is one of the following, provided documentary evidence should support the claimed status.
o Government owned;
o A tax exempt Retirement Fund or Trust; or
o A tax exempt Not for Profit entity (Charity) 565
FATCA Requirements for Non-Individual Customer –
Contd.
• If an entity or a parent company is incorporated in United States, completely filled, signed and dated W9 Form
must be submitted at branch by the customer.
• If an entity is a ‘Passive Entity’, completely filled, signed and dated W8-BEN-E Form must be submitted at branch
by the customer. Following information should be provided on W8-BEN-E Form by Passive Entity:
• Part I;
• Part XXVI;
• Part XXIX (if there is substantial U.S. owner or, if applicable, controlling U.S. person) ; and
• Part XXX (where applicable).
For the purpose of due diligence, branch staff should match the information provided in Part XXVI with the
identification document submitted regarding Owners/Shareholders for their association with United States. If
information mismatches, customer should be asked to provide correct details.
If customer refuses to provide required documents or information, as per approved FATCA Policy, NO relationship
will be initiated with that customer.
566
Remediation Process
 Existing customer who is not a US Person, becomes a US Person due to changes in his/her KYC
 The customer does not have any US Indicia is now identified as US person
 Customer has changed his/her KYC details due to which he is now identified as a US Person or a Non US
Person having US Indicia
Required Action by Branch in above cases:
 Branch Managers / RMs are responsible for the collection of required documentation from the customer.
 Based on the revised documentation, status should be updated in system as applicable.
567
Recalcitrant Customer
 Fails to comply with request by the Bank for the documentation or information necessary to determine US or non
US status.
 Fails to provide correct name and Taxpayer Identification Number (TIN) combination upon request when the
FFI/bank has received notice from the IRS that the name and Taxpayer Identification Number(TIN) combination for
the account holder is incorrect.
 As a matter of Policy, the Bank will not deal with any recalcitrant customer who does not wish to comply with the
published FATCA regulations and the defined FATCA procedures of the Bank.
568
Implications of FATCA Non-Compliance
 Reputational damage;
 Loss of customers;
 Loss of correspondent relationships; and
 Financial losses in the form of 30% with-holding tax on the US-based source income.
569
15. Common Reporting Standards (CRS)
570
What Is Common Reporting Standard (CRS)
• In September 2016, Pakistan signed the Multilateral Convention on Mutual Administrative Assistance
in Tax Matters and become 104th signatory to the Convention. The Convention provides for the
automatic exchange of information under the State’s own systems through standardized formats under
the corresponding agreements with other jurisdictions. The Federal Board of Revenue (FBR) has
subsequently undertaken a Pilot Project on Automatic Exchange of Information (AEOI) in collaboration
with different stakeholders.

• The Federal Board of Revenue (FBR) has notified the same vide S.R.O 166 (I)/2017 dated March 15,
2017. With this Pakistan has adopted the global Standard for Automatic Exchange of Financial Account
Information in Tax Matters commonly known as the Common Reporting Standard (CRS) as developed
by Organization for Economic Cooperation and Development (OECD).
571
Why CRS Is Required To Be Implemented?
 As mentioned, Pakistan has signed an agreement and became 104th signatory to provide information
related to tax matters.
 Under CRS regulation, Banks in Pakistan are required to provide account details of customers’
including tax information to FBR within the defined timelines.
 For the purpose, due diligence of new accounts as well as for high value pre-existing accounts to be
started from 01st July 2017.
572
Timelines For Implementation
Following are the timelines set for the implementation of Common Reporting Standards (CRS)
Requirement Timeline
Commencement of due diligence for “New Accounts” opened on or after 01.07.2017. 01-Jul-17
Complete Due Diligence for “Pre‐Existing High‐Value Individual Accounts”. 31-Dec-17
CRS reporting to FBR for the period ended 31st December 2017 for New Accounts and for Pre-
31-May-18
Existing Individual High Value Accounts.
Exchange of information by FBR to the Reportable jurisdictions related to New Accounts and Pre-
30-Sep-18
Existing High Value Accounts.
Complete due diligence for low value accounts and Entity Accounts. 31-Dec-18
CRS reporting to FBR for Pre-Existing low value individual accounts and Pre-existing Entity accounts. 31-May-19
Exchange of information by FBR to the Reportable jurisdictions related to Pre-Existing low value
30-Sep-19
individual accounts and Pre-existing Entity accounts.
573
What Is Due Diligence Process ?
Due Diligence Process
Pre-Existing
Accounts (On All New Accounts
aggregate basis)
Individual Individual
Entity Accounts Entity Accounts
Accounts Accounts
High Value
$250,000 &
Accounts
Above
Above $1 Million
Low Value
Accounts
$1 Million &
Below
574
What Branches Need to do for Due Diligence?
At The Time Of New Account Opening:
 To obtain a Self-Certification Form, from all individual and non-individual customers.

 To obtain correct information from customer.
 To obtain correct TIN (tax related number)
 To obtain correct tax residency on Self Certification Form.
 May obtain Documentary Evidence for validating tax number and tax residency of all individual and
non individual customers.
 Ensure to mark correct form of Entity. (Financial/Non Financial Entity)
 Ensure to mark correct form of Non-Financial Entity (NFE)( Active/Passive)
 Ensure to obtain Self Certification Form from Controlling person(s) of Passive NFE.
 Ensure that customer sign the Self Certification Form.
575
Due Diligence
As per the guidelines received from Federal Board of Revenue (FBR) and State Bank of Pakistan, Banks are
required to implement Common Reporting Standard starting from 01st July 2017. The exercise is divided
into two main categories i.e.
• New accounts (opened on or after 01 July 2017) which includes Individuals and Entity accounts.
• Pre-Existing accounts (opened on or before 30 June 2017) which includes;
 High Value Individual accounts i.e. aggregate balance above $1 Million

 Low Value Individual accounts i.e. aggregate balance $1 Million and below
 Entity accounts
 All customers having tax residence other than Pakistan and USA (covered under FATCA
regime) are reportable.
576
Due Diligence for New Individual Accounts:
 At the time of account opening, Self-certification to be obtained for Account Holder’s residence(s) for
tax purposes including any documentation collected pursuant to AML/KYC procedures.
 Branches may obtain Tax Identification Number (TIN) on self certification where customer confirms tax
residency along with documentary evidence.
 If branch understands that customer-provided information on self-certification is incorrect or

unreliable, branch must obtain a valid self-certification that establishes the residence(s) for tax
purposes with documentary evidence.
577
Due Diligence for New Entity Accounts
 At the time of account opening, Self-Certification to be obtained for Account Holder’s residence(s) for
tax purposes including any documentation collected pursuant to AML/KYC Procedures.
 Customer to confirm that the entity is a Financial entity or Non Financial Entity.
 If entity is a Non Financial entity, branch to confirm that the entity is an “Active” or “Passive” Non-
Financial Entity (NFE).”
 In case of Passive NFE, Branch to identify the “Controlling Persons” of the entity and obtain Self-
Certification of the Controlling Person(s).
 If the Entity certifies that it has no residence for tax purposes, the Reporting Financial Institution may
rely on the address of the principal office of the Entity to determine the residence of the Account
Holder.
 Branch to ensure that the Self-Certification provided by the customer is reliable and is backed by valid
documentary evidence.
578
Due Diligence For Pre-existing Individual Accounts
Banks are required to review accounts by distinguish between Higher and Lower Value Accounts based on the
defined threshold:
Enhanced Review Procedures for High Value Accounts.
1. Electronic Record Search. The Bank must review electronically searchable data maintained for any of the
indicia
2. Paper Record Search. If the Bank`s electronically searchable databases include fields for, and capture all of
the information described in, then a further paper record search is not required.
If the electronic databases do not capture all of this information, then with respect to a High Value Account,
the bank must also review the current customer master file and, to the extent, following documents
associated with the account and obtained by the bank within the last five years for the indicia.
3- Once accounts are scrutinized through Electronic / Paper record search and no tax residency is identified
yet, Branches are required to contact the customers and obtain self-certification for the confirmation of Tax
Residency. Information should be updated in the system accordingly.
4- If no response is received and there is only “hold mail instruction” or “in care of address” then the account
is to be marked as “Undocumented” account.
579
The Indicia For Electronic Record Search
a) Identification of the Account Holder as a resident of a Reportable Jurisdiction.

b) Current mailing or residence address (including a post office box) in a Reportable Jurisdiction.
c) One or more telephone numbers of Reportable Jurisdiction.
d) Standing instructions to transfer funds to an account maintained in a Reportable Jurisdiction.
e) Currently effective power of attorney or signatory authority granted to a person with an address in a
Reportable Jurisdiction; or
f) a “hold mail” instruction or “in-care-of” address.
Effect of Finding Indicia
 If none of the indicia are discovered in the enhanced review of High Value Accounts, then further
action is not required until there is a change in circumstances that results in one or more indicia being
associated with the account.
 If any of the indicia are discovered in the enhanced review of High Value Accounts, or if there is a
subsequent change in circumstances, then the Reporting Financial Institution must treat the account
as a Reportable Account.
580
Enhanced Review Procedures for Low Value Accounts
Lower Value Accounts. The following procedures apply with respect to Lower Value Accounts:
1. Residence Address. If the Bank has in its records a current residence address for the individual Account Holder
based on Documentary Evidence, the Reporting Financial Institution may treat the individual Account Holder as
being a resident for tax purposes of the jurisdiction in which the address is located for purposes of determining
whether such individual Account Holder is a Reportable Person.
2. Electronic Record Search. If the Bank does not rely on a current residence address for the individual Account
Holder based on Documentary Evidence, the Reporting Financial Institution must review electronically searchable
data.
3. Undocumented Accounts: If the paper search fails to establish an indicium and the attempt to obtain the self-
certification or Documentary Evidence is not successful, the Reporting Financial Institution must report the
account as an undocumented account.
4. A self-certification (and/or documentary evidence) would be needed in case of conflicting indicia, in the absence
of which reporting would be done to all reportable jurisdictions for which indicia have been found.
5. Relationship Manager Inquiry for Actual Knowledge.

In addition to the electronic and paper record searches described above, the Bank must treat as a Reportable
Account any High Value Account assigned to a relationship manager (including any Financial Accounts aggregated
with that High Value Account) if the relationship manager has actual knowledge that the Account Holder is a
581
Reportable Person.
For Pre-Existing Entity Accounts
For Pre-Existing Entity Accounts, financial institutions are required to determine:
 Whether the Entity itself is a Reportable entity, which can generally be done on the basis of available
information (AML/KYC Procedures) and if not, a self-certification would be needed; and
 whether the Entity is a Passive NFE and, if so, the residency of Controlling Persons is required to
know. Passive assessment can be made on the basis of available information, and a self-certification
is required. A threshold may be used for Preexisting Entity Accounts on aggregate balance i.e. below
USD 250,000 (or local currency equivalent)which are not subject to review.
582
Defined Terms
The following terms have the meanings set forth below:

Terms Definition
Custodial or depository institution, Banks, Investment entity or specified insurance
Financial Institution company
Depository Institution any Entity that accepts deposits (Like UBL)
Pre-existing Account an account opened on or before 30-06-2017
New Account an account opened on or after 01-07-2017
Lower Value Account a Pre-existing Individual Account with an aggregate balance USD 1,000,000 and below
High Value Account a Pre-existing Individual Account with an aggregate balance Above USD 1,000,000
any natural person that holds directly or indirectly more than 25 percent of the shares
or voting rights of an Entity as a beneficial owner.
Controlling Persons If no such person exists, then any natural person that otherwise exercises control over
the management of the Entity (e.g., the senior managing official of the company).
NFE Non-Financial Entity

FE Financial Entity
under same common control. Control includes direct or indirect ownership of more
Related Entity than 50%. 583
Defined Terms

Terms Definition
Active NFE essentially excludes Entities that primarily receive passive income or
primarily hold amounts of assets that produce passive income (such as dividends,
interest, rents etc.), and includes;
Active Non-Financial Entity - Publically traded Entities (and Entities related to them),
(Active NFE) - Government Entities,
- International Organization,
- Central Banks,
- any organization wholly owned by these entities
Passive Non Financial Passive NFE is the one where 50% or more income is derived from passive
Entities (Passive NFE) income/non-core activities(outside of normal activities or operations). (dividends,
interest, rents etc.)
Passive Income Income derived from non core activities. (interest income,
dividends, rental income, any other income other than main business activity.)
TIN Taxpayer Identification Number, National Tax No.(NTN) or any form of tax identification
number
CRS stands for Common Reporting Standard 584
Defined Terms

Terms Definition
includes any of the following:
i. a certificate of tax issued by an authorized government body.(NTN, TIN, etc.)

ii. with respect to an individual, any valid identification issued by an authorized
government body ( CNIC, Passport, NICOP etc.)
Documentary Evidence iii. with respect to an Entity, any official documentation issued by an authorized
government body in which the Entity was incorporated or organized.
iv. any audited financial statement, third-party credit report, or securities regulator’s
report etc.
585
Thank You
586

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Branch Services Officers

Branch Management Development Program

After participating in the course, learners will be able to:

1. explain the reasons for caring for customers;

C – cost of the paycheque we receive

Internal customers are those who work within the organization

External customers of an organization are the ones outside the

Good customer service is taking that extra step to help without

1) It retains the customer

5) Gives you and your employees confidence

6) More Effective Workforce

• Know about your organization

• Smile and greet a customer

Communication skills involve: sender

• Listening to others (Receiving) message

What does good rapport feel like?

• Make the customer feel comfortable

Find out how You can Help

• How can you find out what people want?

• Know how to use the phones

• Respond business email quickly

• Label the behavior, not the customer

• Hiring and training employees

Calm the frustrated customers

Check the branch

Strategies, Planning and Documentation

Innovation and Customer Engagement

Customer care has to have its roots in a

"To know thyself is the beginning of wisdom.“

Why you might want to know your own nature?

Induce "challenge stress."

Empower employees to choose their work patterns and habits.

Give employees a voice in their own job design.

Intentionally build relationships.

Facilitate whole-person growth.

Empathy represents the ability to understand someone else’s thoughts and

Being empathetic in the workplace provides meaningful, concrete returns.

1. Rethink How You Listen

2. Master the Art of Asking Questions

3. Walk in Your Coworkers’ Shoes

4. Avoid Making Assumptions

5. Learn How to Prioritize Problems

6. Don’t Keep Your Coworkers at Arm’s Length

7. Remember That People Have Feelings

8. Accept That Empathy Doesn’t Happen Overnight

• Negative response: “No, the project won’t run at a loss.”

• Negative response: “It won’t have a detrimental impact on the environment…”

• Negative response: “We didn’t do that”

You never get a second chance to make a positive first

Last impression is the lasting impression.

We will discuss dress-up etiquettes in the coming slides.

“Packaging is engineering your image.” It includes:

How do you see yourself?

How do people see you?

Shouldn’t you package yourself as who you want to be?

Handle Complaints Promptly

• Shirts: Plain colored or light thin stripes/checks.

• Ties: Matching Conservative (Not Too Flashy of flowery)

If the suit is dark, then the shirt should be

 Plain color or thin stripes or checks.

 Avoid wearing dark shades at work

 Should be wrinkle free.

 Not too flashy