Habib Bank Limited
Habib Bank Limited
Habib Bank Limited
On
HABIB BANK LTD
PREEDY GATE BANNU
NWFP
Submitted By:,
Submitted To:,
SIR, AMIR RASHEED
(Assistant Professor CIIT, Lahore)
1
Department of
BUSINESS ADMINISTRATION
COMSATS INSTITUTE OF SCIENCE AND
TECHNOLOGY
(LAHORE CAMPUS)
2
Dedication
I dedicated this
efforts to my
Parents & Teachers
who Guide
&
Encourage me
during the course
3
Of My Studies and
preparation Of this
Report.
Pr eface
Every student of Master in Business Administration at COMSATS INSTITUTE OF
SCIENCE AND TECHNOLOGY has an essential requirement to do Six weeks
internship in any of the well reputed organization. The purpose of this program is to
acquaint the students with practical applications of theoretical concepts taught to them
during conduct of their MBA program.
The internship in HABIB BANK is personally arranged by my own resources and the
department gave me a letter for getting this internship.
Really, it was a nice opportunity to have a close comparison of theoretical concept in
practical field, involving the use of primary and secondary data. All the efforts on the
way are summarized in shape of this Internship Report. This Report may depict
deficiencies on my part but still it is an output of a student’ efforts, for which I beg
pardon.
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The out put of my analysis is summarized in a shape of Internship the contents of the
report
Shows the detail of sequence of these. The report is concluded with problem and
suggestions.
I have no wards to express my gratitude to the chairman management sciences and
my advisor Assistant Professor, Sir, AMIR RASHEED for their intellectual guidance
without which it could have been rather difficult for me to complete this report.
ACKNOWLEDGEMENT
No one can say that I am perfect everyone should admit that
without the help of ALLAH and His people a man cant get anything
so I bow my head before almighty Allah with gratitude. I am also
very much thankful and presents salute to many individuals who
have helped me in shaping this report .I am also very much
thankful to lot of former fellows and contemporary colleagues who
took the time and trouble during the last few days to speak to me
a b o u t t h e w a y t h i s t e x t c o u l d b e f u r t h e r i m p r o v e d . First of all this report
owes it originated to the valuable assistance of our learned & honorable teacher Sir
AMIR RASHEED whose able guidance and encouraging attitude throughout has been
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a source of inspirations for us. Without his kind attitude patronage, we would have
never accomplished this task.
I am also thankful to the the staff Habib Bank Ltd especially to Sir NASEEB ZAMAM
(Administrative officer) who provide me an opportunity to work in friendly environment.
I am also very much thankful to Sir IRFAN (Cash Officer) and Sir Muhammad Ali
(Advances In-charge).
It has been an honor and pleasure to work with:
M r. M . N a w a z ( A c c o u n t a n t )
Executive Summary :
As we all know very well that time and tide wait for none.So,
because of this rapid change in time and era we have to cope with
it.During this era I got an opportunity of getting practical knowledge
about the Banking system in Pakistan.So to quench the thirst of
practical exposure and for getting the basic knowledge about Bank
I joind HBL Preedy Gate Bannu.During six week in HBL i gather all
necessary information about HBL.
Efforts have been made to compile this report in such a way that
activates its salient features not only for students but also for the
layman. I have divided this report into different Chapters.
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Chapter is about the branch where I worked and watch different
function which I learnd in HBL Preedy Gate Bannu.
CONTENTS
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Saving and Profit and loss Accounts
Time/Fixed Account
5. LOANS & ADVANCES 45 to 47
Finance for Working
Capital
Trade Finance
Facilities
Finance for Capital
Investment
General Products
Other Products and
Services
Investment Assistant (IA)
6. New Knowledge Acquired 48 to 49
Knowledge About the Clearing Section
Knowledge About Remittances
Knowledge About Account Section:
Knowledge about cheques
Filling of Cheques
Mutual transfer of cheques
7. Swot Analysis 50 to 54
Strength
Weaknesses.
Opportunities
Threats
8. PROBLUMS I SOUGHT AND 55 to 57
RECOMENDATION
Problems
Strong Recommendations
GLOSSARY 58
. BIBLIOGRAPHY 59
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CHAPTER # 1
INTRODUCTION
Meaning of Bank
The word “bank” has been derived from the French word “banque” or bancus which
means bench, office or institution for the keeping, lending and exchanging of money.
Some authorities have the opinion that “Bank” is derived from the “Germen” word back
which to the meaning of “joint stock fund”. The bank is a financial institution that
borrows money from one party and lends to the other party (Government, individual,
business) and the difference between borrowing and lending make profit for the bank.
Bank borrows and lends money on interest basis. Banks are classified according to
their sphere of activity; the main types of banks are as under.
Commercial banks
Industrial banks.
Agricultural banks.
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Saving banks.
Exchange banks.
Central banks.
Cooperative banks
COMMERCIAL BANK
History of bank is very old, the history of bank is traced to as early as 2000 B.C. The
priest in Greece used to keep money and valuable of the people in temples. Its origin
is also traced to early goldsmiths. They used to keep strong safe, for storing the
money and other valuable of the people. People with surplus money deposited with
them. The first stage in the development of banking was the acceptance of deposits
from people.
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Later on goldsmiths began to issue receipts for the money deposited with them to
settle transactions. These receipts were used in payment of debt and acceptable to
all. This was the second stage towards the development of banking.
When goldsmiths realized that they had surplus money therefore they intended to lend
some portion of money to he nearly traders and merchants who constantly requested
for loans This business was quiet profitable and they instead of charging interest from
depositors began to give interest on the money deposited with them to attract more
people this was the third stage towards the development of banking.
They also planned to allow the customers to withdraw in excess of the amount
deposited to meet the customer’s needs. This facility is called overdraft and they used
to keep some portion of money for this purpose. After some time there was then
started too much confusion in the banking system and they were not able to
Meet the demands of customers. This failure on the part of money lender
to return money caused distress among the people.
To overcome this problem people felt that their must be a bank which control the
banking activities of different lending organization. As a result of conference held in
1548 at Nuremberg. The decision was taken in favour of establishing a bank that
regulates the banking activities.
The first bank was found in Geneva in 1587. Later on many other banks were
established will the same objective.
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branches has enabled HBL to provide comprehensive services that meet customer
needs. This has ensured thriving client relationships that form the backbone of the
Bank's operation.
Today, HBL plays a central role in Pakistan's financial and economic development. It
has come a long way from its modest beginnings in Mumby on August 25,1941 when
it commenced operations with a fixed capital of 25,000 rupees.
Impressed by its initial performance, Quaid-e-Azam Mohammed Ali Jinnah asked the
Bank to move its operations to Karachi after the creation of Pakistan. HBL established
itself in the Quaid's city on August 7,1948 and became a symbol of
pride and progress for the people of Pakistan.
Habib Bank has been a pioneer in providing innovative banking services. These have
included the installation of the first mainframe computer in Pakistan followed by the
first ATM and more recently, internet banking facilities in all our 1425 domestic
branches.
The Bank's towering presence in Pakistan's financial and commercial life has
remained unchanged over the decades. The strength of its brand and image is
symbolized by its prominent Head Office building that has dominated Karachi's skyline
for35Years.
We continue to build on our track record and in our quest for excellence we strive to
meet the needs of both our customers and our employees. At Habib Bank we aim to
ensure customer satisfaction by providing high quality banking services. This is made
possible by the professionalism of our employees all of whom are provided with the
requisite training and opportunities to enable them to realize their full potential.
GOALS OF HBL:
1 To mobilize private savings and public funds for diverting the same into
productive channels and ensure their availability.
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active participation of private and public sector in the province.
3 Create a diversified and sound portfolio for utilization of idle funds and their
investment in the existing and new ventures especially in the pioneering of
high-techs agro-based export oriented and engineering project to ensure
maximum returns.
4 Participative and seek the share of the country in the capital market of
Pakistan by way of subscription through locally peopled resources in the
leading stock exchange of the country and eventually paying the way for
establishing a stock market in the province.
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1. This Branch was established on May 10,1952 to facilitate two giant Business
community and inhabitant of HBL (BANNU) Branch ,besides providing series of
general banking to the citizens and nearby areas. Currently it an on-line bank.
2. BASIC FUNCTIONS
• Accepting of deposits:
• Advancing of loans:
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• Act as a referee
• Financing of Foreign Exchange
• Preparation of feasibility reports for small industrial units
• Collection of fees and money for people proceeding on “Haj” providing pilgrimage
services
• Acts as Income Tax adviser
Manager
Operation Manager
2. Deposit section.
3. Clearing section.
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4. Remittance section.
5. Accounts section.
There are certain formalities which are to be observed for opening of a current
or saving account with a Bank. These formalities in brief are as under
i. FORMAL APPLICATION:
The bank before opening, and account obtains introduction of the customer
from old customer, responsible person etc.
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IV. MINIMUM INITIAL DEPOSIT:-
In Pakistan the current account can be opened with a minimum of Rs. 500/-
and PLS Saving Account with a minimum of Rs 100/- These amounts are also the
minimum balances to be maintained by the account holders with the Bank.
V. OPERATING THE ACCOUNT.
ii. Cheque Book and pass book with a view to operate it.
i. Send the pass book for making entries and also periodically check up them.
ii. He should also see that the entries are initialed by the accountant.
iii. The customer should verify the entries with own books of account.
iv. In order to safe guard the secrecy of the account; the customer should receive
the pass book in closed cover.
B. WITH-DRAWL.
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C. INTEREST.
Every account is made up half yearly to 30th June 31st December, and the
interest calculated as above is added to the balance of each account as on these
dates.
D. TRANSFER OF AN ACCOUNT.
E. CLOSING OF AN ACCOUNT:
A depositor willing to do, his account must present his pass book in order that
with drawls and the amount of interest due on the account is entered therein and final
balance stuck. This balance is then paid to the depositor and his receipt is taken, the
pass book is canceled, unused cheque forms on hand are also surrendered at the
same time.
F. SECRECY:
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The secrecy of depositor’s account is the. Responsibility of every official
engaged in the Bank service.
When money is sent by post for deposit, the pass book and a letter starting the
amount of the deposit and the number of the account accompany it.
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H. TYPES OF BANK ACCOUNT.
i. Saving account
The account can be operated by depositing a minimum cash of Rs. 5/-. Small
percentage of interest is allowed on the balance of this account.
The current account is that one which the customer draws his daily cheques
and is normally operated by the Business-men. It can be operated by minimum
amount of Rs. 500/- Any number of cheque amounting undue minimum balance limit
can be issued by the account holder for withdrawal or for payment. No interest is
allowed on this account.
A joint account occurs when two or more than two customers have one
account. The parties to a joint account are considered in law as they are one person.
The holder of account can withdraw up to Rs. 15,000/- per month is eight
withdrawals, in case of higher withdrawal, seven day prior notice is necessary. This
account is operated under interest free system.
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v. FIXED DEPOSIT ACCOUNT.
At the time of operating on account the Bank issues deposit certificates for the
period and amount. The account holder can not withdraw his amount before the
specified period, but the same Bank will allow loan against that certificate. Bank is
liable to give interest on this account on maturity date.
2. DEPOSITS SECTION:
There are two types of deposits i.e. current and saving. There are different
forms present in the section of or deposits.
In the above mentioned forms, the bank makes an agreement with his
customers.
3. CLEARING SECTION.
Every Bank performs the paying and receiving functions. Cheques are
collected which are drawn up to Banks for customers. Similarly the cheques drawn on
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different Banks and deposited by Banks own customers for collection within the city is
know as clearing The functions of receiving and paying is mostly done through the
clearing house. A clearing house can be defined as "AA place where that
representatives of all Bank get together to settle the receipts and payment of cheques
drawn on each other" Clearing House provides the facility which can hardly be
dispensed with especially, in case of crossed cheques.
i Outward clearing
ii Inward clearing.
i. OUTWARD CLEARING:
It includes those cheques and other instruments which are sent by the Bank to
the Banks for payment on behalf of its own clients. Cheques are sent to clearing
house thorough local main branch.
A delivery message from the local main branch comes to every branch at a fixed time
to pick its outward clearing or outward returns as the case maybe.
e. Jotting of all the schedules are taken in the clearing House statement. Amount
of the cheques in written in the "Delivered" and to pay column.
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f. After balancing the outward clearing, the pay in slips are released to C.D.
department.
The cheques drawn are called inward clearing drawn on Habib Bank through its
representatives.
on the Bank presented by other Banks for payment It includes those cheques and
other instruments of Pakistan branches which other Banks present at the clearing
house.
b. The amount's of all the instruments are jotted down and totaled. If should be
equal to the amount mentioned in schedule from the local main branch.
e. If there is any return, that is deducted from the total and IBCO prepared for the
remaining amount.
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1. TRANSFER CHEQUES.
These are the cheques which are collected and paid by same branch of HBL
For example Mr. Ali is a customer of HBL of CITY branch and draws a cheque in favor
of Mr. Hussain who is also the customer of the same branch.
The cheques which are collected and paid by two different branches of a Bank
situated in the same city. For example a person draws a cheque on N.B.P. main
branch, D.I.Khan in favor of another person who maintains an account with N.B.P.
Rakh Mandra branch, D.I.Khan.
3. CLEARING CHEQUES.
When the payee/endorse and the drawer of cheque maintains account with
different Banks, the collection Bank in any one of the following methods:-
a. It can collect cash by sending its representative with the cheques to each of the
paying Banks. It is not so much appropriate.
a. To accept transfer, transfer delivery and clearing cheques from the customer of
the branch and to arrange for their collection.
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b. To arrange payment of cheques drawn on the branch and gives for collection to
any other branch of H.B.L. or any other member or such member of local
clearing house.
The customers are provided with the copes of pay In-slip, whenever the
customer wants to deposit any cheque, he fills in the pay in slip himself and hands it
over the counter along with the instrument.
4. REMITTANCE SECTION
I. Inland remittance.
1. INLAND REMITTANCE.
a. Within locality.
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a. WITHIN LOCALITY
b. OUTSIDE LOCALITY.
i. TELEGRAPHIC TRANSFER
In telegraphic transfer, the Bank takes commission and telegram charges from
the sender. A receipt is issued to the sender for the value received.
The Bank itself transfer the funds to the drawee branch though a coded
message in telegram, confirmatory of which is also sent through routine date
mentioning all details. All bank Branches have been provided with their code books
name Bank Keys Code Book where from the coded message is agreed by the drawee
branch. T.T. can be sent open, which may be paid in cash in drawee branch, or may
be direct y creditable to relevant account.
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ii MAIL TRANSFER (M.T.)
The Money can be remitted through this means also. In this case the payable
amount at the drawee branch can only be transferred to an account; amount can not
be paid in cash. Other procedure is same as T. deposit of money at sending branch.
Difference is only of postage and. telegram charges. The M.T. which in its self is an
advice also is sent by registered post, while T.T. is sent through telegram.
5. ACCOUNT SECTION.
Every Business organization deals in money matters. Bank also deals in money
and more over since the money belong to the depositors therefore, it is of utmost
importance to keep systematic and correct record.
Further-more, the Banks are commercial institutions and its main objective is to
earn profit, therefore, then record of all incomes and expenditures are kept correct and
systematically.
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The Branches of Bank perform their daily routine work and deal in money that
belongs to depositors. Here account department hold great importance in banking,
because it keeps all the accounting records properly.
ACCOUNTS TERMS.
The account department maintains all the accounting records properly there
are certain accounting terms which are defined into the following
1. ACCOUNT
2. VOUCHERS
3. GENERAL LEDGER.
Main ledger is a book, where various accounts of different type are kept.
Generally this book is in bended form containing several sheets for several accounts.
4. SUBSIDIARY LEDGER.
Where a main head has got different sub-head of it: subsidiary leader are
maintained. These subsidiary ledgers are maintained from the main ledger.
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BOOKS AND STATIONERY.
b. Abstract book.
d. Register of vouchers
e. Transfer book.
h. Supplementary sheets.
i. Different vouchers.
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During the course of daily business of the branch, a number of cheques are
presented by customer for cash payment, though transfer, delivery and clearing
cheques at the counter. Also a number of new accounts are opened and cash is
deposited by the customers. A number of new vouchers are passed by the branch by
debiting, one account and crediting another account.
So in order to ensure that during the day all the transactions have properly been
recorded and they are complete in all respects and are recorded in proper books by
the branch this recording is done on daily basis and maintained by account section.
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1. BALANCING AND MAINTAINING OF BOOKS.
Balancing the cash book means that all the transactions have properly been
recorded and there is no mistake in any of these vouchers.
iv. Agreement of total of the summary, with the total of transfer book.
2. PREPARATION OF STATEMENTS.
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CHAPTER# 3
Commercial Banking
Corporate Banking
Investment Banking
Retail Banking
Islamic Banking
COMMERCIAL BANKING
They not only knew the market but were also familiar with the shortcomings of
HBL. Under the new set-up, they were able to address these shortcomings and began
to target HBL’s customer base. With the inception of an alternative, HBL customers
started migrating to the newly established banks this causing the erosion of HBL’s
market share.
During FY-2000 HBL’s management decided to address this issue. Hence forth,
Commercial Banking was created to focus on the business needs of the middle
market customers. On November 1, 2000 Commercial Banking came into being. At
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present, 18 Commercial Centers and Sub-Centers functioning, located at Karachi,
Lahore, Faisalabad, Sialkot and Gujranwala.
Goals
The Goals of setting-up Commercial Banking was two-fold:
The strategy adopted to achieve the above objective was to position Commercial
Banking segment as the “Trade Finance Bank” for its customers. The rationale behind
this strategic decision was to capitalize on the existing marketing knowledge & strong
contacts with the middle market customers, who were loyal to the HBL brand.
o DA (Unseen)
o DP (Sight)
Successful achievement of the strategy entailed addressing the following key issues:
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Developing a sales culture so that business was aggressively
sought
Marketing; and
Operations
Trade
o Credit
o Trade Services
o Computer literacy
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Impact of the steps
The decision to setup Commercial Banking has been fruitful. This is evident from the
following results:
Our strategy has allowed us to achieve our first objective; the trend of
erosion in our market share has been reversed. We now would be looking
at regaining our market share.
Commercial Banking is making headway with improvement not only in terms of the
business figures but also in its ambiance. Renovation of is being carried out in order to
give a professional look to all the Commercial Banking Centers.
Corporate Banking
Corporate Banking is recognized as a market leader due to its unique ability to meet
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the entire spectrum of a customer’s banking requirements. HBL’s large equity base
allows to meet the financing needs of the largest corporate and it’s
large network and specialized teams are able to deliver and provide
customized solutions. The Group
has increasingly focused on providing value addition services to the customers, e.g.
payroll and cash management services. The Bank has become a leader in cash
management services by leveraging its large domestic branch network and now
provides such services to a range of large and medium sized corporations, including
the Pakistani units of some Fortune 500.companies.
The Group also strives to stay ahead of the market by anticipating customer
requirements. We strongly believe in relationship banking, which is essential for us to
remain responsive to our customers. We also remain focused on improving
productivity and ensuring the quality of our risk management.
In 2003, Corporate Banking Group continued to expand the scale of its activities, with
a substantial increase in new customers, revenue and profitability.
Investment Banking
Retail Banking
The Retail Banking network, with 1425 branches, is the core strength of Habib Bank.
Its extensive reach in all geographic locations – urban and rural – throughout the
country provides access to over 5 Million customers across all sectors of the
economy. The network provides HBL with the largest diversified low cost deposit base
of any bank in Pakistan, and forms the basis for many of its other business lines:
corporate and investment banking and treasury activities.
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Retail Banking Group (RBG) has two principal areas of activity;
HBL is the only major bank to have a very dedicated group to serve the Small &
Medium Enterprises (SME) sector. HBA believes that the SME sector can be an
engine of growth for the economy and represents an area of opportunity for the Bank.
CBG was therefore established in late 2000 to provide banking services and credit on
a structured and systemized basis. It now covers 25 branches in the six major
industrial cities of Pakistan. The Group now works closely with its customers, which
cover all segments of the economy including the textile sector, vendors and suppliers
to structure the finances and improve their capabilities. We have been very
encouraged by the outcome that reaffirms its belief in the potential of this sector.
With its extensive branch network and large customer base, HBL has an important
role to play in the development of this sector of the economy in which it expects
substantial growth in the next five years. HBL has moved aggressively and has
already introduced three major products;
• Personal Loans,
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• Car Financing
• Consumer Durable Financing
in association with major suppliers of consumer products. These have been well
received and volumes have been building up steadily. It is the
intention of HBL to be a leader in consumer financing. Plans are also
underway to develop mortgage
While HBL continue to develop its products, we recognize that quality of customer
service will become an even greater differentiating factor in the market. HBL have
taken a number of initiatives in this area; investing in technology, training and
upgrading of its branches. Extended banking hours and better facilities for utility bill
payments have been made available.
In 2002, HBL launched real time inter-city banking, internet banking for 500,000
customers and PC banking for its corporate and commercial banking customers. HBL
ATM network has expanded and its usage is also growing rapidly.
A Debit Card program has also been introduced which will be available in over 1,000
point of sale terminals within the country.
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Inward remittances from overseas Pakistanis provide an immeasurable support to the
economy. Owing to our unique combination of the largest domestic and international
networks, we process the highest volume of overseas remittances into Pakistan. We
recognize that speed and efficient processing is the requirement of remitters and to
meet these needs, we have put in place our FAST Transfer service and our fully
automated processing center in Karachi ensures that all
remittances are delivered within 24 hours in urban areas and 48 hours
in rural areas.
ISLAMIC BANKING
The Bank of Khyber has taken the first step towards Islamic banking and for this
purpose an Islamic banking division has been established to complete the necessary
regulatory and operational formalities thereby paving the way for commencement of
Islamic Banking in its specialized branches.
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HBL believes in serving the nation and building the country strong. We are always at
the forefront to support noble causes and promote the social & cultural activities in the
country. The Public Relation Division of HBL sponsors various social, cultural and
sports events to generate healthy activities in the society. It also organizes religious
programs to uphold the religious tradition of our people. The Division represents the
bank at important forums to exchange views on national &
international issues with various organizations to boost the
intellectual activities.
The Commercial Banking at Habib Bank Limited focuses on small and medium sized
businesses. This segment is the traditional stronghold of HBL with proven expertise
and market knowledge.
Units dedicated to service small and medium sized business are located at Karachi,
Lahore, Faisalabad, Gujranwalla and Sialkot. Each unit has Relationship managers
with in-depth knowledge of the market. These relationship managers assist existing
and potential customers with their financial needs.
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CHAPTER # 4
BANK DEPOSITS
Deposits are to the bank as a backbone is to the body of a man. They are the
lifeblood of the bank. HABIB BANK LIMITED and all other commercial banks perform
the function of deposit accepting from the general public by offering suitable rates of
interest on them, or on simply a promise to repay on demand.
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2. ACCOUNT OPENING FORM AND SPECIMEN SIGNATURE CARD:
Now the person is provided with an application form known as Account Opening
Form.
This form contains: -
i. Title of account
ii. Address
iii. I.D.Card number
iv.Telepnone.No.
(Office and Residence)
v. Introductory reference (all above mentioned particulars of introducer )
vi. Signatures of the applicant
vii. Amount deposited
viii. Check book series No.
In addition to this the customer is required to attach a copy of National Identity Card
with the form.
Speciman signature card:
Specimen of signatures will be obtained from depositor at the time of opening his
account. A specially designed card is used for this purpose; the card must be
countersigned by an official of the bank not below the rank of an officer.
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A special cheque book register is kept to enter the name of the person having cheque
book.
PASSBOOK is another important type of book handed over to the customer as he
opens the account with the bank. The with drawl and deposit of money is recorded
date wise in this book.
5. RECORDING IN TO GENERAL LEDGER:
The concerned officer records the name and amount deposited with the
bank in to general ledger. Separate ledgers are maintained for different
types of accounts e.g.
CURRENT ACCOUNTS:
A bank account which may be used to lodge payments or to withdraw money on
demand.
Its main purpose is to serve the businessman. Form number F-53 is provided to the
person to open the account. It is a statutory requirement to maintain current account.
Its main features are: -
1. Minimum amount for opening this account is Rs.500
2. Any person can open the account with the bank
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3. According to inter banks agreement interest is not paid on current account.
4. Bank act as custodian of money
5. Over draft facility is provided to the customers
6. Customer can withdraw money through cheque supplied by bank
Total depositors in current account in HABIB BANK LIMITED (PARADI GATE
BRANCH) up to 15-07-2006were 847000 approximately and the number of
current accounts are 44 .
To provide interest free banking facilities in Pakistan, this type of account was
introduced in January 1982.The main features of this account are: -
1. Instead of having fixed return in the form of interest the deposited money will be
shared in profit and loss of the bank.
2. One can open the account by depositing minimum Rs.100
3. Withdrawal is allowed 8 times in the month total not exceeding Rs.15000.
4. To withdraw a large amount a notice of 7 days to the bank is necessary.
5. There is not any kind of interest is provided on money deposited.
6. Rate of profit is declared at the close of each half-year.
Total deposits in PLS account in HABIB BANK LIMITED (PARADI GATE BRANCH)
up to 15-07-2006were 26633000 approximately a number of accounts are 713.
This account is the major source of funds for the banks. This account is best for
people who have surplus money and don’t need such funds in nearer future.
The money is deposited for a fixed period of time. Main features of this account are: -
1. Fixed amount deposited for fixed period.
2. Amount of profit can be obtained after each six months.
3. Higher will be the time period, higher will be the rate of profit.
4. A receipt is used for the amount deposited called fixed deposit receipt.
5. Period of deposit can vary from 3 months to 5 years.
The amount can be withdrawn before maturity after surrendering interest.
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The number of term/ fixed deposit account up to 15-08-2005 were 93 and their
deposits 9853000.
Total loans accounts in this branch = 182 and advances in these loan accounts = Rs
14030000/
CHAPTER # 5
The Commercial Banking at Habib Bank Limited focuses on small and medium sized
businesses. This segment is the traditional stronghold of HBL with proven expertise
and market knowledge.
Units dedicated to service small and medium sized business are located at Karachi,
Lahore, Faisalabad, Gujranwalla and Sialkot. Each unit has Relationship managers
46
with in-depth knowledge of the market. These relationship managers assist existing
and potential customers with their financial needs.
Export Finance:
o Foreign Currency Export Finance: Dollar financing for pre & post
shipment requirements (FCEF)
o Foreign Bills Purchase: for financing of export bills (FBP)
Import Finance:
General Products:
Commercial Day to day banking: There are a wide range of accounts and
services to help you manage your money. We offer:
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o Current Accounts: Non-interest bearing account for your daily banking
needs.
Investment Assistant has been created specifically to assist expatriate Pakistanis who
are interested in investing in Pakistan. Using Commercial Banking as a platform, we
will be providing information of legislative, regulatory and financial nature to
prospective investors to help them setup their businesses in Pakistan.
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Chapter#6
e of All MIGHTY ALLAH I did a lot of hard and able to learn every
section of the Bank .I utilize all my bookish knowledge to get this
practical knowledge.
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As the area where I did my internship ,the people are not well
educated that is why whenever a person will come for opening
an account than the manager referred that man towards me.
Than I guide that man and the form of opening an account will be
Filled by me and all the legal requirement are completed by me.
In past the Habib Bank use and the old type of firm but now it
Is using a new firm of opening an account. There were five sign
Are required on old type of firm but now the new firm require
Only one side. Whenever adperson goes to open an
account than
He need a person for introduction who has an account in that
Branch os the Bank.
CLEARING SECTION:
I also work in clearing section during my work I learned how to
collect the different cheques of different Banks. then I learned how these cheques of
different Banks mutually transfer. For mutual transfer everyday a meeting is held in
NBP main branch bannu. The representative of UBL, ABL, BANK AL FALAH, BANK
OF KHYBER, HBL was participating and thus mutual transfer of cheques were held.
NAEEM sahib was the in charge of this section .he gave me a lot of attention.
REMITANCES SECTION
I also worked in remittances section .in remittances section I learned how to transform
the money from one place to another place. In this section I learned ,
1: DEMAND DRAFT.
2: TELEGRAPHIC TRANSFOR.
3: ON LINE TRANSFOR.
On each transaction there is commission charged to the sender.
The commission of(D.D) is Rs; 130.
This charges is on the (D.D) up to 4lakh.
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The commission of (T.T) is Rs175.
The commission of (O.T)is Rs 200.
Chapter # 7
SWOT Analysis
The acronym SWOT stands for a firm’s internal Strengths and Weaknesses and its
external Opportunities and Threats. The purpose of such analysis is to build on
company’s strengths in order to exploit opportunities and counter threats and to
correct company’s weaknesses. SWOT analysis is based on the assumption that if
managers carefully review such strengths, weaknesses, opportunities, and threats, a
useful strategy for ensuring organizational success will become evident1.
1
Samuel, C. C. (1989). 4th edition, Principles of Modern Management. Massachusetts:
Wm. C. Brown Publishers. p.143
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Strengths and weaknesses typically relate to the internal environment of an
organization, whereas opportunities and threats are brought about by the external
environment of an organization. In the following section, both internal and external
analyses of HABIB BANK IMITED are outlined:
7.1.1 Strengths
Strength can be defined as an area where a company is best at doing
something or a feature that puts the company at an advantage in comparison
to its competitors. MCB enjoys the following strengths:
i. HABIB BANK is a well established bank enjoying long history of over 65
years of experience and profitable operation.
ii. HBL was the first privatized bank that gives it an edge over other
nationalized banks as it can develop any strategy consistent with the
demand of market and free from any political or bureaucratic influence.
iii. HBL is the largest private bank in Pakistan now and people trust is very
high.
iv. It has the largest branch network among private banks of Pakistan.
v. HBL is the market leader in introduction of e-banking and it has the largest
ATM network in the country.
vi. The Bank’s Rupee Traveler Cheques have been market leaders for the
past six years.
vii. HBL was rated the best domestic bank for two consecutive years of 2000
and 2001 by Euro money, a leading international publication.
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viii. HBL has forged strategic alliances with international banks for expanding
its network further, both locally and internationally.
ix. HBL has the ability to bring innovative products and services like
personalized service, electronic funds Transfer, sophisticated financial
products such as electronic banking, auto-teller machines and evening
banking.
x. HBL has been very effective in controlling costs as it successfully
restructured itself after its privatization. During this process more than
1,600 employees were relieved under a golden handshake scheme and
110 branches were closed.
xi. Excellent branches appearance gives an edge
to HBL over other banks. The branches are well furnished
even in less developed areas where other banks’
branches give a poor view.
7.1.2 Weaknesses
A weakness is defined as an area in an organization where the organization is
not as good at doing something as its competitors or a thing which an
organization lacks thus putting the organization at disadvantage in comparison
to its competitors. Based on the above definition, MCB has the following
weaknesses.
iv. Employees at branch level are not properly motivated to work by heart. They
take the all routine activities as a boring job.
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v. Most of the employees lack managerial training as they are not properly
educated. Due to seniority, they have moved up on the hierarchy line to Grade-
I, II or III positions having hardly bachelor degrees. This type of senior staff
cannot apply the modern and innovative techniques of management in decision
making.
7.2.1 Opportunities
An opportunity can be defined as a change in external environment which if
properly exploited with the organizational strengths will result in enhanced
sales, market share, or income. Using its strengths, MCB can avail the
following opportunities:
i. HBL may enhance its Rupee Travelers Cheques (RTCs) sales by searching for
new market niches.
ii. It can introduce debit card system or may convert the existing ATM cards into a
complete debit card.
iii. New products like personal loans, mortgage and auto leasing and cash
management which diversify credit risk and add to revenue generating
products, are currently provided in big cities like Lahore, Islamabad, Karachi,
and Rawalpindi, these products may be tested for success in other small areas
of PAKISTAN in different provinces.
iv. Developing network for electronic transaction require huge investment which
can’t be made all at once, there exists an opportunity for HBL to enter into
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agreement with other banks to use each other’s ATMs which will result in an
increased convenience to HBL customers and customers of other banks.
v. As all around the world remittances of money are strictly monitored so as the
money remitted may not fall in hands of so-called terrorists. for that all
conventional money laundering through Hundies have been stopped, there is
an opportunity for HBL to extend its branch network to various countries
emphasizing mainly on introducing electronic fund transfer facilities.
7.2.2 Threats
Threat can be defined as a change in external environment which if not met
with proper strategies will result in loss of revenues, market
share, or income. In the context of MCB’s external environment,
the following potential threats exist:
i. The Rupee Travelers Cheque (RTC) sales volumes may be affected on
account of regulatory restriction imposed by SBP on issuance of large value
denominations.
ii. The frequent reduction on 6-month and 12-month Treasury Bills discount
rates by SBP may create pressure on the banks profitability.
iii. The low discount rates are also negatively influencing the advances rates
which may affect the banks profits from the other side.
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through them. Major portion of the trade financing is for importers to
establish letters of credi
Chapter # 8
PROBLEMS I SOUGHT
During my Six weeks stay in (HBL Preedy Gate Branch Bannu) I found
various problems, which I think, so should be resolved for the better
functioning of the Bank. Some of these problems are of such nature that
their solution will help the Bank and its workers in cooping in this complex
world of globalization.
1) There is a lack of on-line information in the Bank about the changes taking
place in the world of Banking.
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3) Educated staff is there but they are not specialized in their respective field’s
e.g. accounting, finance and depositing etc.
7) After entering into Bank premises a customer wants to see and meet manager
himself, (because of not having a separate room for him) which some time
causes inconvenience for the manager.
8) Only one computer is available there, which is insufficient for the modernized
functioning of the day.
10) Messengers in the Bank are not quick in obeying the orders of the
manager.
Recommendation I Propose
1) I will give following suggestions for the better function of the Bank:
3) The daily newspapers and journals should be provided to the employees and
customers visiting there.
6) The Bank management should be very careful while granting the loans.
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8) Personal credit worthiness must be carefully scrutinized public relation desk
should be established in each and every branch for guidance as well as
redresses of grievance of customers at the spot.
11) New talent / professionals should be hired to coupe with the competitive
demand in the industry.
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GLOSSARY
A/C: account
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P.L.S: Proft and Loss Account
Dr: debit
Cr: Credit
BIBLIOGRAPHY
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6- Meenia, S.A Money Banking and Financial Market 3rd edition (Oxford
University Press Karachi 1984).
7- Mishkin, Frederic S. money banking se financial markets,3rd edition
(Hourper Collins New York 1992).
8- Saeed, Khawaja Amjad, financial institution in Pakistan. 1st edition (Royal Book
Co.,karachi.l985).
9- Siddqi, Asrar H. Practice and law of banking in Pakistan.(Royal Book Co.
Karachi 1993).
10- Singh Karam Sc Tanna. Suresh, Bankers Student Text (Hutchinson, London,
1989).
11- Sinkey Joseph F. Commercial Bank Financial management 2nd Edition.
(Macmillan Publishing Co.New York 1986).
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