final Report

Executive Summary

Bank Alfalah was incorporated in 1997 and was privatized by the Government of

Pakistan. The Abu Dhabi Group bought the majority shares of the bank and so

got the rights to control the bank’s operations. Since the privatization of the bank,

Bank Alfalah has implement different policies to make it one of the best banks of

Pakistan, which included introducing new products and services and increase its

operations by opening new branches in Pakistan. Bank Alfalah is dealing in

Foreign Currency Accounts, Foreign Remittances and Foreign Bills for

Collection, imports and Export. But the Branch in which I worked it deals in

Pakistani rupee transaction in foreign currency was not the practice of this

branch. I did my 8 weeks internship at Bank Alfalah Islamic Banking Group,

Kotabdul Malik Branch. This branch is established in 2008 and major in

Operations. I worked there in Account opening department and remittances

department. I also Spent some of my time at Clearing Department and

understood the procedure of Islamic Banking. The over all experience at the

bank was good. Infact the maximum Customer of the branch were Individuals

and businesses entities. Most of the businesses have their Salary accounts and

saving accounts there. As the branch has been established in an Industrial Area

so many of the Employer Companies are enjoying the services of the bank.

During my internship Program, I found that due to the effective customer service

and proper Guidance the number of customer are increasing day by day. The

competitors of BAFL are also in aggressive position. The Economic and Political

conditions of the country are very disturbing; the high inflation and law and order

situation affects every business including Alfalah. Bank Alfalah has seen a rapid

growth in its activities by introducing a range of products and services and

showing its presence in the country by opening new branches and in future

should keep this momentum and always strive to become the best.

THE CARING BANK

Company Background

Bank Alfalah Limited (“BAL”) is a private bank in Pakistan owned by the Abu

Dhabi Group. Bank Alfalah was incorporated on June 21, 1997 as a public limited

company under the Companies Ordinance 1984. Bank Alfalah is registered at

both Karachi and Lahore Stock Exchange with a ticker name of “BAFL”. Its

banking operations commenced from November 1, 1997. The bank is engaged in

commercial banking and related services as defined in the Banking companies

ordinance, 1962, with the registered office at B.A.Building, I.I.Chundrigar Road,

Karachi.

Since its inception, as the new identity of H.C.E.B (Habib Credit and Exchange

Bank Limited) after the privatization in 1997, the management of the bank started

implementing strategies and policies to carve a distinct position for the bank in

the market place.

This was further strengthened with a partnership with the Abu Dhabi Group which

owns 70% of Bank Alfalah shares. This allowed the bank to invest more in

revolutionary technology to increase its range of products and services,

perceiving the requirements of their customers and matching them with quality

products and service solutions.

Bank Alfalah has gone through different phases over the years. Its name and

been changed in the following sequence.

Bank of Credit and Commerce and International (BCCI)—1972

Habib Credit and Exchange Bank—1992

Bank Alfalah—1997

Bank of Credit & Commerce International (BCCI) was a Pakistan based bank,

established by Mr. Agha Hassan Abdi from UBL, in association with U.A.E and

Europe. BCCI has its branches in 74 different countries of the world. It had its 3

branches in Pakistan, Karachi, Lahore and Rawalpindi.

THE CARING BANK

The Lahore branch was opened on 15th December1978. This branch was

opened at that time when some other international banks like Citi Bank, Bank of

America, and American Express etc. were already working.

But within a few years this branch crossed mostly all the other banks in case of

deposits, advances, imports and exports dealings, guarantees, traveler‘s cheque

sales etc. In 1991, the BCCI was banned, when it was accused by European

countries that the bank was involved in some illegal operations with Gulf

countries. The major reason behind European accusation was that BCCI was of

Islamic mode. Therefore, the bank was closed due to international pressure.

In July 1991, the branches of BCCI in Pakistan at that time were taken over by

The Ministry of Finance and SBP. All three branches were given under Habib

Bank Limited.

After valuation of its assets for 15 million dollars, which were named as Habib

Credit and Exchange Bank (HCEB) and these were working as subsidiary of

Habib Bank Limited.

Following the privatization in 1997, Habib credit and Exchange Bank assumed

the new identity of Bank Alfalah on June 21st, 1997 as a public limited company

under the Companies Ordinance 1984. Its banking operations commenced from

November 1st, 1997. The bank is engaged in commercial banking and related

services as defined in the Banking companies ordinance, 1962.

The bank is currently operating through 282 branches. This includes 48 Islamic

banking branches and 7 foreign branches in Bangladesh, two in Afghanistan and

one offshore banking unit in Bahrain with the registered office at B.A.Building,

I.I.Chundrigar, Karachi. The bank is listed on the Karachi and Lahore Stock

Exchange with a ticker name of “BAL”.

PACRA, a premier rating agency of the country, has rated the bank

For long term „ AA‟ (double A)

For short term A1+ (A one plus)

THE CARING BANK

Introduction

Central Background Information

Banking is one of the most sensitive businesses all over the world. Banks play an

important role in the economy and are considered as the backbone of an

economy in every country and Pakistan is no exemption. Banks are custodian to

the assets of the general masses. The banking sector plays a significant role in a

contemporary world of money and economy. It influences and facilitates many

different but integrated economic activities like resources mobilization, poverty

elimination, production and distribution of public finance.

Pakistan has a well-developed banking system, which consists of a wide variety

of institutions ranging from a central bank to commercial banks and to

specialized agencies to cater for special requirements of specific sectors. The

country started without any worthwhile banking network in 1947 but witnessed

phenomenal growth in decades to come. By 1970, it had acquired a flourishing

banking sector. Nationalization of banks in the seventies was a major upset to

domestic banking industry of

the country, which changed the whole complexion of the banking industry. With

irrational decision at the top, all the commercial banks were made subservient to

the political leadership and the bureaucracy. The commercial banks thus lost

their assets management equilibrium, initiative and growth momentum. They

ceased to be a business concern and became big bureaucracies.

Today, the banking sector is providing financial solutions to the masses

and is growing and becoming a solid partner in the development of the

Pakistani economy, this growth potential has seen different acquisitions in

the banking sector, with the Standard Chartered and Union Bank being the

most prominent.

THE CARING BANK

Islamic Banking

History

The history of Islamic banking from its recorded inception is less than 40 years

old. From a humble beginning in a small village in Egypt in the late 60’s, it has

spread to the four corners of the world. By normal standards in a time span that

is less than half a century it could have hardly been expected to establish

foothold in Muslim world, let alone make its presence felt in Muslim-minority

countries. Yet such has been its phenomenal rate of growth that not only is it

taking firm roots in its homestead, but is also attracting genuine interest among

the standard bearers of conventional banking and in swathes of land where

Muslims are a small minority only.

Still there is much ground left to cover. In Pakistan, Islamic Banking is less than

3% of the Banking sector. Even in the Gulf states, where it has a larger footprint,

in no single country is the volume of Islamic banking more than a third of the

entire sector.

Many blame Islamic Banking small share against conventional banking to a

smaller portfolio of products. A standard complaint against Islamic banks is that

they do not have the same variety of financial instruments as found in

conventional banking. Though valid to an extent, this popular jeremiad needs to

be seen in the perspective of Islamic Banking brief history against more than two

centuries of conventional banking adopted in full force across the globe, its

competition against an entrenched system of banking and the constraints within

which it must operate.

Notwithstanding, Islamic banking is still growing at more than twice the growth

rate of conventional banking worldwide, and while it may not have the latter’s

plethora of financial products, its repertoire of Islamic financial products is

steadily increasing.

THE CARING BANK

Riba

It has been argued in vain for long in some circles that the prohibition in Islam is

that of excessive interest only. Or that it is the interest on consumptive loans that

has been forbidden and as

such loans extended for commercial purposes are entitled to an excess over the

principal amount lent. Such tendentious arguing fails to give due understanding

to verses 278 and 279 of Surah Al-Baqarah (quoted below).

“O ye who believe! Be afraid of Allah and give up what remains (due to you)

from Riba (usury) (from now onwards) if you are (really) believers! 2:278

And if you do not do it, take notice of war from Allah and His Messenger!

But if you repent, you shall have your capital sums 2:279

However, this does not mean that Islam prohibits any gain on principal sums. In

Islam, profit is the recognized reward for capital. When capital employed in

permissible business yields profit that “excess over capital” becomes the rightful

and just claim of the owner of the capital. As a corollary, the risk of loss also rests

exclusively with the capital and no other factor of production is expected to incur

it.

Basic Islamic Instrument

Musharakah

Musharakah is one of the two ideal modes of Islamic financing. The other one

being Mudarabah. Musharakah is a contractual relationship formed through

mutual consent of the parties for sharing of profits and losses in a joint venture.

THE CARING BANK

Mudarabah

Like Musharakah, Mudarabah is also a form of partnership. Whereas all partners

in Musharakah contribute capital, under Mudarabah partnership is formed

between provider of capital and provider of expertise or human resource.

Proportions for sharing profit are decided upfront. Losses are incurred solely by

the partner contributing capital.

Murabaha

Murabaha is a non-participatory mode of Islamic financing where the bank sells

the asset required by its client to the client on cost-plus basis. The asset is first

purchased by the bank and the bank incurs

he risk of any loss or damage to the asset as long as the asset remains under its

ownership.

Ijarah

Under this facility a client may take on rent, property, vehicle or any other real

asset belonging to the bank. The bank transfers the right of use of the asset to

the client, while retaining the ownership of the asset. The client pays periodic rent

to the bank for the use of the asset.

Salam

Salam is a contract of advanced payment against deferred delivery of goods.

Goods paid for in advance by the buyer are delivered by the seller after an

interval of time.

Istisna

Manufacture of a specific product against precise specifications by a

manufacturer for delivery to buyer. It is necessary that the price of the product

and product specifications are fully agreed upon by the manufacturer and the

buyer, and that the material required for manufacture is arranged by the

manufacturer.

THE CARING BANK

Bank Alfalah Islamic

Company Information

Great journeys begin with but a single step and mighty oaks are born out of

humble seedlings. Bank Alfalah – Islamic Banking Division (BAL-IBD) – presently

a division of Bank Alfalah Limited – is gearing up to become a separate, full-

fledged Islamic Banking entity. BAL-IBD offers to its customers a broad range of

Islamic products under personal, consumer and corporate banking modes. The

array of Islamic instruments at the disposal of BAL-IBD is equipped to provide

efficient and satisfying solutions to our customers’ needs. Our Islamic products

are Shariah-compliant carrying the seal of approval of the Centre of Islamic

Economics, an institution vested with powers to attest authenticity and legitimacy

of Islamic banking products in Pakistan.

BAL-IBD has entered into a Shariah Consultancy agreement with the Centre of

Islamic Economics, Karachi, which is a noted and well-known seat of learning for

Shariah scholars and a prominent institution dealing in Shariah Advisory

services. Besides assisting in advancement of the Division’s product portfolio, the

Centre also stamps approval of the Division’s conduct of business following

periodic audits. These audits are in addition to those carried out by the State

Bank of Pakistan and the internal audits undertaken by the Division itself.

Performance

Bank Alfalah’s Islamic Banking Division (BAL-IBD) started operations in 2003

and at its yearend reflected a modest capital base of Rs 100 million and deposits

totaling Rs 113.7m.

By following yearend, BAL-IBD’s equity had risen more than 4 times to Rs 569m

and the balance sheet footing had swelled to Rs 7,799 million. Deposit size had

grown from less than Rs 114m to over Rs 7,229 million. The pace of frenetic,

triple digit growth was continued over the next twelve months as equity more

than doubled to Rs 1,278 million from Rs 569m.

THE CARING BANK

Assets also recorded a more than 100% growth, climbing to Rs 15,634 million

from Rs 7,799 million. Deposits alone failed to double – rising to Rs 12,476m

from Rs 6,548 million – yet managing a healthy 90% increase. Financial results

as of June 30, 2006, reflect growth but at more modest pace.

Total balance sheet size fell shy of Rs 18 billion – Rs 17,970m vs Rs 15,634m –

and deposits climbed to Rs 14,111 million, rising Rs 1,635 million in six month’s

period. Income for the 6-month period was Rs 111.23 million.

Bank Alfalah Islami overall structure is in the following way.

Personal Banking

Personal Accounts

Bank Alfalah – Islamic Banking Division (BAL-IBD) offers Current, Savings and

Term Deposit facilities to its customers seeking personal banking relationships

with the following features:

Facility Minimum

balance

Profit Zakat deductions

Current deposit PKR 10,000/= Nil Not applicable

Musharakah

Savings

deposit

PKR 5,000/= Tiered structure, 6

monthly pay-out

Applicable

Musharakah

Term deposit

PKR 50,000/= Tiered structure, 6

monthly pay-out

Applicable

All profits subject to 10% withholding tax

On-line cash deposit facility at all branches of Bank Alfalah

On-line transfer facility between all branches of BAL-IBD

THE CARING BANK

Remittances

Foreign and local remittances are both available. Foreign remittances are

available in the following currencies: US dollars, Pound Sterling and Euro.

Locker services

Locker services are offered at select branches. Lockers are available in three

sizes – small, medium and large. Annual charges for the lockers are as follows:

Small Rs 1,000/-

Medium Rs 2,000/-

Large Rs 3,000/-

Lockers are available to account holders and carry an insurance value of

Rs .250, 000/-

Corporate Banking

Murabaha Finance

Types

o Local purchases: For purchase of locally available goods

o Imported goods/commodities/assets

Mode of repayment

o Immediately in cash

o On a mutually agreed future date

o Spot Murabaha (Import)

o Deferred Sale Murabaha

THE CARING BANK

Trade Finance

Imports

o Letter of Credits

o Import Murabaha Finance

o Full range of services related to imports e.g. Contract registration,

Import bills for collection, Shipping Guarantees and Advance

payments against imports.

Exports

o Export Murabaha Finance

o SBP Islamic Export Finance Scheme

o Other export related services e.g. Collection of export bills,

Negotiation under Sight LCs, Advising/Confirmation/Transfer of

Letter of Credits opened by other bank.

Bank Guarantees

A host of Guarantee types are offered by BAL-IBD including performance,

financial and payment guarantees. BAL-IBD also issues guarantees securing

financing facilities to be availed from Islamic Banks and/or Conventional Banks’

under Islamic modes of financing.

Consumer Banking

Alfalah Musharaka Homes

Alfalah Hilal Card

Alfalah Car Ijarah

THE CARING BANK

Islamic Financing Is Asset-Based Financing

A key feature of Islamic banking is that unlike conventional banks which deal

primarily in money and financial securities, Islamic financing is related to an asset

that is a feature of the transaction, and quite often the principal feature itself.

From this springs an important distinguishing feature of Islam

wherein Islamic financing is always based on illiquid assets that have intrinsic

value. Profit to Islamic financing is generated through bonafide sale of these

assets.

Conventional banking, on the other hand, is free of such limitations. It lends

money and makes its earnings through this act of lending. Its earnings are

unconcerned with the economic fate of its lending.

Branch Network

Alfalah bank Islami has 13 branches in Lahore, 14 in Karachi, 3 in Islamabad ,3

in Rawalpindi.2 in multan.1 in Peshawar,4 in Faislabad along with these Islamic

bank is working in Total 24 cities of Pakistan.

The Head Branch is in at Uni Tower, I. I. Chundrigar Road, Karachi.

I completed my Internship at Bank Alfalah Islami Kotabdul Malik Branch

Sheikhupura. This single branch is in operation in this city.

THE CARING BANK

THE CARING BANK

V I S I O N

“To be the premier

Organizations operating locally

and internationally that provided

the complete range of financial services

to all segments under one roof”

THE CARING BANK

MISSION

“To develop and deliver the most innovative products, manage

customers experience, deliver quality service that contributes to

brand strength, establishes a competitive advantage and enhances

profitability, thus providing value to the stakeholders of the bank

Chief Executive Officer

Co-Chairman Central Management Committee

Group Heads

Regional Managers

Area Managers

Branch Manager

Operations Managers

Organizational Hierarchy

Fig.1

THE CARING BANK

A general hierarchy of bank which is showing about the main authorities of Bank

Alfalah Limited who are controlling its management in Pakistan. Bank’s

management is divided into different groups, regions and areas. Co-chairman is

providing supervision to group heads that are responsible for controlling the

affairs of different groups.

Board of Directors

The board of directors has the authority in guiding Bank affairs and in making

general policies. Some directors are the personnel of the Bank Alfalah Limited

follows.

H.E. Sheikh Hamdan Bin

Mubarak AlNahayan

Chairman

Mr. Mohammad Saleem

Akhtar


Mr. Abdulla Nasser

Hawalileel Al-Mansoori

Mr. Abdulla Khalil Al Mutawa

Mr. Ikram Ul-Majeed

Sehgal

Mr.Khalid Mana Saeed Mr. Nadeem Iqbal Sheikh

THE CARING BANK

Management

Board Advisory Committee

Mr. Abdulla Khalil Al Mutawa Director

Mr. Khalid Mana Saeed Al Otaiba Director

Mr. Bashir A. Tahir Member

Mr. Ganpat Singhvi Member

Mr. M. Iftikhar Shabbir Secretary

Board Audit Committee

Mr. Abdulla Khalil Al Mutawa Director

Mr. Khalid Mana Saeed Al Otaiba Director

Mr. Bashir A. Tahir Member

Mr. Ganpat Singhvi Member

Mr. M. Iqbal Saifi Secretary

Auditors

KPMG Taseer Hadi & Co.,

Chartered Accountants

Registered / Head Office

B. A. Building

I. I. Chundrigar Road

Karachi.

THE CARING BANK

Chain Of Command

Fig.2

THE CARING BANK


Executive Incharge

Strategic Planning & Global

Marketing

Executive Incharge

International &Treasury Division

Executive Incharge

Human Resources Division

Executive Incharge

IT Division

Executive Incharge

Credit Division

Executive Incharge

System & Operation Division.

Executive Incharge

Establishment & Administration

Executive Incharge

Credit Monitoring Division

Executive Incharge

Business Development Division

S.A.M./ Car Finance/ Leasing

Executive Incharge

Legal Affairs Division.

Executive Incharge

Audit & Inspection Division

Executive Incharge

Finance Division

Executive Incharge

Corporate Banking,

SME Financing & Home Loans

Executive Incharge

Islamic Banking Division

Now 13byears after being incorporated, Bank Alfalah has emerged as one of the

foremost financial institution in the region, endeavoring to meet the needs of

tomorrow today, operating through more than 200 branches in 74 cities nation

wide, with total employees exceeding 7000. Bank Alfalah also expanded its

network internationally by opening branches in Afghanistan, Bangladesh and

Bahrain to further improve its image as a premier banking institution.

Celebrating 10 Years of Bank Alfalah

Fig.3

THE CARING BANK

About the Bank

A. Human Resource Planning

B. Policies

C. Core Values

D. Communication

E. Marketing

F.Managerial Practices

Human Resource Planning in Bank Alfalah

Human Resource Planning is the process of assuring that right type of people

with right capabilities are available when required. HRD of Bank Alfalah has to

care all the important activities. It is engaged in the process of hiring, firing,

training, development and all other related activities. HRD is also engaged in

process of designing and evaluating the jobs and determining a pay structure for

the jobs.

Terms of Employment

The following are the four categories

1 Regular (M.T.Os, C.R.Os)

2 Contractual (B.D.Os)

3 Temporary

4 Casual

Job Analysis and Design

In the job analysis, HRD of BAL plays the key role in the job identification,

respective duties and responsibilities. They systematically collect, evaluate, and

organize the information about jobs. Basically job analysis is review of job from

which they analyze the performance of employee and on the basis of this

performance they give rewards and benefits.

THE CARING BANK

Job Analysis

Job Description Job Specification

Fig.4

Job Description

In BAL, virtually against every job, job description is prepared. The main features

of job description are

1 To whom the employee is responsible.

2 What are the Job Grade, title, and location of the job.

3 Job Summary and duties. It briefly describes which are the duties of the

employees, their responsibilities and brief introduction of the job.

4 Working conditions.

Job Design

As we know that jobs are more than a collection of tasks recorded on a job

description. While designing the job, HR Department specify the work activities of

the individual. However designing the job in the Banking sector is a complex

function because of variety of factors that enter into arriving at the ultimate job

structure

Once the job analysis exercise has been practiced successfully, and job

description for each job is prepared, then HRD’s job does not end. It starts from

this activity and engage in estimating the demand and supply of human

resources.

THE CARING BANK

Recruitment

Recruitment is basically attracting the employees and encouraging them to apply

for the job. Human resource department is responsible for the recruiting process.

First of all they analyze that it is essential to do recruitment or there is alternative

to recruitment. i.e. contracting

Methods used or internal recruitment

For internal recruitment they use to inform their employees that there is any job

exists and also use job bidding which help the employees to apply for a vacant

job who think that they have enough capabilities for doing the job. Then after

internal methods they will go for external recruitment.

Method used or external recruitment

Most important source of their external recruitment for the purpose of filling low

level jobs are advertisements and fresh students from universities. On the other

hand for management and executive level they recruit the experience people.

Selection

In BAL, the selection process is a series of steps through which applicants pass.

The process starts from the review of applications and resumes, then after

analyzing the resumes they take the preliminary interview as the next step to find

out that whether this employee have potential or not according to the related job.

Then there are tests for employees. After the tests there are detail interviews for

the employees. These interviews are structured and there are group interviews

for the employees. After the interviews Successful candidates are selected.

Orientation

Once the selection process is completed, new employees are oriented in order to

become productive contributors. Orientation improves the rate at which the

employees are able to perform their job.

THE CARING BANK

Training and Development

The Bank continues to follow its strategy of hiring batches of young and energetic

Management Trainees who are sent to Training and Development Center for

training in all areas of banking. Training of the seventh batch is expected to

commence in May 2005. At the same time, short courses are continually

conducted for other team members to not only enhance their skill level but also

increase their performance potential.

Career Development

Bank Alfalah is committed to the personal welfare and professional development

of all its employees. The management realizes that proper career development is

essential, not only for a more productive and satisfied work force but also for a

excellent corporate culture.

Career planning is very important aspect for development of the employees. By

career planning employee's career goals are set and to achieve them. The bank

feels the responsibility to develop the careers of their employees so that they

would be able to get themselves high and high in corporate hierarchy. Then the

principle aim of career development programs is to help employees, analyze their

abilities and interests to better match personal needs for growth and

development with the needs of the organization.

Performance Appraisal

Performance appraisal is the process of reviewing the individual performance.

First of all, bank set some standards for different level of employees and direct to

their employees to do work according to these standards and evaluating their

performance.

Period

In BAL performance appraisals are usually prepared after every six months,

performances of every employee is to be reviewed and on the basis of these

performances compensations and benefits are determined.

THE CARING BANK

Performance Appraisal methods

Which are being used in Bank are

1 Essay about employee performance description

2 Work standard

Policies of Bank Alfalah Limited

Alfalah Bank since its establishment has been providing excellent services all

because of the strengthened policies and strategies set out by its Broad

and Management. These police cover all grounds of good banking, following is

the road map to their success

1. Customer satisfaction will always remain the number one benchmark; the

aim is to maximize value for clients by offering high quality financial

solutions that best meet their current needs and long-term goals.

2. Bank is continuously looking for expansion in terms of deposits so highly

dedicated Business developments Officers (B.D.Os) are being hired.

3. To maintain sufficient resources over a long period of time and utilize them

in productive way. This can be done through Liquidity Management and

Credit Risk Management.

4. To promote strong and ethical business practices in the industry by

focusing more on effective collaboration with stakeholders.

5. The corporate policy focuses on striking the optimum balance in

organizational workflows and processes

6. Bank Alfalah is committed to the personal welfare and professional

development of all team members and sharing expertise and operational

excellence across the groups.

7. The Bank is fully aware that branch network has direct impact on the

business so; an intensive branch network will be established all around

the Country.

THE CARING BANK

Core Values of Bank Alfalah

Bank Alfalah is firmly grounded with a corporate philosophy that

incorporates five solid values, which each individual associated with the

bank. These Values and Business Principles provide the framework within

which they carry out their operations abides by.

1.Humility

Bank encourages a culture of mutual respect and treat both for team

members and customers with humility and care.

2.Integrity

Integrity means a synergic approach towards abiding the core values.

United with the force of shared values and integrity, Bank Alfalah form a

network of a well-integrated team.

3.Team Work

Bank Alfalah team strives to become a cohesive and unified force, to offer

you, the customer, a level of service beyond one’s expectations. This

force is derived from participative and collective endeavors, a common set

of goals and a spirit to share the glory and the strength to face failures

together. The entire department heads work with their subordinates as

team members they provide them help and guide them to achieve their

goals.

4. Culture of Innovation

The Bank aim to be proactively responsive to new ideas, and to respect

and reward the agents, leaders and creators of change.

THE CARING BANK

Communication

The Communication in the branch is quite simple; the chief managers take

circulars from the Area Office viva Head Office and inform others in the branch

through a formal meeting, while the top management uses newspapers,

circulars, and weekly magazines, annual reports for downward communication.

The Branch manager can also inform top management about any query or

problem and in the same way subordinates can talk about anything that is

troubling them.

Marketing

No business activity can be planned without objectives therefore every company

has its own marketing objectives like, to achieve maximum market share, to

achieve desired volume and gain maximum profit.

In order to achieve such marketing objectives each organization has its own

ways and tactics. These ways and tactics help in achieving the pre-determined

goals of the organization.

Competitive Strategy of Bank Alfalah

The strategy used by the management to position BAL in such a way that it will

have distinctive advantage over its competitors.

Cost Leadership

Bank Alfalah adopted the strategy to be the cheapest services provider

(the cheapest rates for the services of Remittance, foreign trade etc), and

the lowest interest rates for their products.

Differentiation

The strategy an organization follows when it wants to be unique among its

competitors with unique products and value added services.

THE CARING BANK

Target Market

The target market, of Bank Alfalah Limited, is not only the conventional

consumers but the corporate sector as well.

Unique products and services

Bank Alfalah plans to introduce innovative and flexible financial products

and services.

Lowest Rates

The rates will be surely charged less then the completing products of other

banks e.g. UBL car financing.

Managerial Practices

Aggressive Banking

Bank alfalah expanding their network of Islamic Banking. Bank Al Baraka has

been serving the Islamic banking sector since 10 years and they have only 5

braches in Pakistan. On the other hand bank Alfalah has established 20

branches in a year.

Motivation

Bank Alfalah motivating their employees by giving them comprehensive benefits

and professional environment within the organization, which enhances the

performance of the employees. Bank motivates their employees by giving 3

bonuses in a year.

Benefits

Monitory Benefits

Monitory benefits are given to the employees on the basis of their performance

like salary rise, cash prize.

THE CARING BANK

Grade Promotion

Bank also provides benefit to their employees in the form of grade promotion.

Grade promotion motivates the employee to do their work efficiently and

effectively.

Abroad Posting

Bank benefit their employees by sending them on overseas posting where they

can enhance their professional skills and get handsome financial benefits in

terms of salary or fridge benefits.

Controlling

Bank has proper setup of controlling the day to day transactions and operational

affairs. Bank controls the operations through a proper check and balance system

and properly monitor the daily work.

Internal Control Unit

Bank has an Internal Control Unit that monitors the daily transactions within the

organization and keeps informing the management about the rules and policies

violation. Internal control unit has a proper check and balance on operations and

other bank departments.

Internal Audit

Internal audit is a tool to have a proper check on daily working in a bank. Internal

auditor has to point out the discrepancies found during audit. Internal auditors

hand over the audit report to the audit chief and he hand over that to the

management. Management overlook all the discrepancies and try to reduce the

violation and also took the necessary actions. Internal audit conducted in a bank

twice a year.

THE CARING BANK

External Audit

External auditors are the representatives of state bank of Pakistan. State bank

assigned them to audit the banks the find out the lapses or discrepancies

according to the rules and regulations of state bank of Pakistan. State bank

imposed penalty on bank if they found any discrepancies related to banking

practices or procedures. External auditor hand over the audit report to state bank

of Pakistan and SBP handover the report to the management along with the debit

advice in form of penalty and management overlook the discrepancies and take

necessary actions. External audit conducted once in a year. Bank Al Falah has a

Chartered Accountant Company on his panel who prepare and overview the

financial reports of the bank.

Customer Problems

It seems that the priority is given to the corporate customers in Bank Al Falah as

the individuals from middle class have to remind the management of certain

branch to do the needful for them. Customer is the king and customer always

right. Bank is earning profit from the customers. Bank should have a proper

relationship with corporate as well as individual customers. It is recommended

that the management should stress on having satisfactory relationship with

individual customers because they can also provide the revenue in term of profit.

Structure of the Organization

BAL is highly centralized and partially decentralized organization. All the

decisions are made by Board of directors, Members of Executive Committee and

Divisional Heads of the Bank Alfalah Limited. This centralized structure helps

them to make big decisions, while decentralized structure provides authority to

Area Mangers and Branch Managers to make any decision regarding their fields

of interest. Following is the structure of Bank Alfalah Limited:

THE CARING BANK

Kind of Organization

Bank Alfalah is a Public Limited Company, and provides financial services to

customers. It is all and all a customer-oriented organization. The banking

solutions are not only for the conventional consumer but also for the demanding

needs of the corporate sector.

Social Commitment

The Public Relation Division of BAL maintains effective rapport with the general

public by communicating the policies and schemes of the bank through press

and electronic media. Besides maintaining close relationship with journalists &

advertising agencies, the Division also receives the visiting dignitaries and

delegations from abroad.

BAL believes in serving the nation and building the country strong. BAL is always

at the forefront to support noble causes and promote the social & cultural

activities in the country. The Public Relation Division of BAL 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 the people.

Mechanics of generating Profits

The mechanics of generating profits is the BAL’s valuable services e.g. Foreign

trade, Remittance, BTF and comprehensive and diversified products e.g. Auto

Finance, Home loan, Visa Card etc.

Morale of the Employees

The employees at ALFALAH BANK are self-motivated and the reason for their

such kind of motivation is the working environment which has to be conductive

for efficiency.

The morale of workers in Alfalah Bank is very high and this high morale is as a

result of keen interest and careful supervision of the top management. It is all

because of the healthy environment provided at all branches of the Bank and

very kind and neat relationship among the employees, and very satisfactory

compensation and benefit system.

THE CARING BANK

Employment Opportunities for new People

Bank Alfalah is creating opportunities for the new people as Bank Alfalah is the

fastest growing bank of Pakistan with the network of more than 200 branches,

covering 70 cities and all the employees are Pakistani. Bank follows a strategy of

optimum financial and quality human resource allocation in order to enhance the

performance. BAL is continually endeavors to hire numbers of undergraduates,

graduates and professionals.

Career Development

Bank Alfalah is an organization that provides opportunities for its staff to have a

challenging and rewarding long-term career. To this end the Human Resource

Department (HRD) encourages and motivates its employees to excel in the

responsibility that they have in the organization. BAL believes that creativity and

innovation comes from talent, knowledge and experience and it is endeavours to

provide and maintain an environment which not only nourishes these strengths

but also provides opportunities for the staff to have a career which has

multidimensional growth opportunities.

The overall direction of HRD has been towards nurturing the strengths of the

human capital to its maximum with a defining principal to help create a

progressive environment During 2004, workshops, skill development clinics and

seminars in the disciplines of Service & Attitude, Market Research & Selling,

Management & Communication, Credit & Finance, I.T. & e-Banking, Treasury &

Trade Finance, Global/ Domestic Banking Operations and on other diverse

subjects were conducted.

THE CARING BANK

Internal Structure of Bank

THE CARING BANK

Branch ManagerMr.Zahid Hameed

Operations Manager Mr.Tuheed Mumtaz

Relationship

ManagerMs.Ruba

ta Nadeem

BDOMurtaza

Ul Hassan

Remittence

Dpartment

Clearing OfficerMr.Imran Malik

Cash Room InchargeMr.Shoaib

Document

Incharge

Mr.Farhan

Other Staff

Guards,Teaboy,

Rider ,Sweeper

Description of various departments and Sections

Customer Relationship

Account Opening Department

This department is responsible for opening, closing of an account, issuance of

cheque books, handling customer request, dealing with the customer and

explains them the different type of accounts and their benefits for them. This

department has vary important position in operations because this is the first

impression of bank for customers.

The main document in this department is, of course, the Account Opening Form

(AOF) also known as relationship contract.

Procedure of Opening an Account

1. Completion of the Form

a. Basic customer information

i. Customer name

ii. Father name

iii. Mother maiden name

iv. CNIC number

v. National Tax number

vi. Current house no

vii. Permanent house number:

viii. Contac numbers

ix. Profession

x. Employer details

THE CARING BANK

b. Specimen Signature Card (S. S. Card)

c. Cheque book requisition

d. Operating instruction

e. Type of account

f. Currency for account

g. In case of death how will operate the account

h. Agreement on terms and conditions

i. Online account

2. Allotment of Account Number

3. Letter of thanks sent to customer

4. Issuance Of A Cheque book

5. Entry Of A cheque book

6. Acknowledgement of letter of thanks

7. Filling Of Account Opening Forms

8. Filling of Request

9. Maintaining the Computer Record

Accounts opening department is one of the departments that come under the

retail/general banking facilities provided by Bank Alfalah.

Major Deposit Account Products

The Alfalah Islamic Banking Kotabdul Malik branch is dealing in major deposit

product as follows

Current Account

Current Accounts are non-profit bearing accounts that have a minimum account

opening requirement of Rs.10.000.No Zakat is deducted on the account balance.

Furthermore all current account holders receive a Hilal card and there are no

restrictions on the number of withdrawals or deposits made to and from the

account. Sometimes upon instructions salary Account of an Individual require

initial deposit Rs.500

THE CARING BANK

Basic Banking Account (BBA)

Basic Banking Account was introduced by banks on an order by the State Bank

of Pakistan and is current in nature. There is no minimum balance requirement

for BBA, however initial deposit must be Rs 1000. Maximum two withdrawals and

deposits are allowed by cheque, while there is no restriction on ATM withdrawals.

Saving Accounts

1. Alfalah Musharka Saving Account

Musharka saving account is more suitable for individuals who wish to earn profit

on their savings and investment normally. Musharka saving Account offers

monthly Profit

Distribution and Profit calculation is on monthly average balance Bank Alfalah

Islamic is providing great flexibility these accounts because there are three type

of accounts offer under this category suiting almost every individual how wish to

invest and want to get better earning on his saving.

The Latest profit rates are shown as

Table.1

Amount-PKR July-2010

Minimum 0 to 9,999 5.03%

Maximum 100 Million & above 8.01%

In between these variable rates are available

THE CARING BANK

2. Falah Mahana Amdani Account

This account can starts from minimum Rs 10,000 and maximum you can invest

five million rupees. The benefit of this account is that you can withdraw your

money you don’t need to fix your amount for specific period of time. The profit is

paid on monthly basis on the minimum balance you maintain in that month.

Table 2

Amount-PKR July -10

10,000 to 15,000,000 9.03%

3. Falah Classic Saving Account

This account can starts from minimum Rs 10,000 and maximum no limit. This

account is the conventional saving account. Benefit of this account is that you

can withdraw your money you don’t need to fix your amount for specific period of

time. Profit is distributed bi-annually and profit calculation on monthly minimum

balance.

Table.3

Amount-PKR July-10

10,000 and above 5.06%

4. Falah Premium Saving Account

This account can starts from minimum Rs.100 maximum Rs.50, 000,000. This

account offers monthly profit distribution and profit is calculated on Daily balance.

Table.4

Amount-PKR July-10

Min 100 to 999,999 5.07%

Max 50,000,000 to 99,999,999 5.75%

THE CARING BANK

Term Deposit

Classic Saving

Mahana Amdani

Musharaka Saving Account

5. Term Deposit

In order to earn profit the client is required to keep his/her deposits with the bank

for some time. This period can be 7 days, 30 days, 3 month, 6 month, 1 year, 2

year and 3 years and 5 years. The profit rate starts from5.06% to 11.05%

depending on time span but the profit rate keep on changing on monthly basis.

The minimum limit for these accounts is Rs1,00,000 and maximum no limit.

Fig.6

THE CARING BANK

6. Royal Profit Account

Royal profit accounts are opened with a minimum balance requirement of Rs

50,000. The basic aim of this account is that the higher the balance the higher

the return, as profit is credited on a monthly basis. The profit paid to account

holders is as follows:

Profits paid on Royal Profit Account

Table.5

Amount Profit pa.

From Rs.50,000 to 999,999 2.50%

From Rs.1,000,000 to 4,999,999 3.50%

Rs.5,000,000 and above Negotiable

Internal Codes for Some Accounts

Table.6

Account Type Code

Current Account 020*****

FMA Account 359*****

Saving Account 036*****

Different Type of Accounts and Document Requirement

THE CARING BANK

Current Account

1. Sign on account opening form (AOF).

2. Sign on CNIC Verification.

3. Sign on CNIC Undertaking (if AOF sign differ from CNIC sign).

4. ‘Signature admitted’ stamp on SS card (Once for each person, e.g. incase

of joint account, admit both persons signatures separately).

5. ‘Signature admitted’ stamp on Rules and Regulations

6. ‘Signature verified’ stamp everywhere else on customer signature.

7. Attach Income Proof.

8. Attach Copy of Letter of Thanks to Customer + Introducer with TCS

Receipt with AOF.

9. Attach know your customer (KYC) form.

Saving Account

1. Everything under Current Account + Profit Sheet signed.

(Refer Table 7)

Company Account

1. Same as Current Account for stamping etc, but more documents are

obtained. As mentioned in table 2.

2. Separate KYC for company (KYC Format for Companies), and separate

KYC’s for People involved (KYC Format for Individuals), e.g. in a

partnership account with two partners, three KYC’s will be attached, one

for company and two for the partners.

(Refer Table 8)

THE CARING BANK

Minor Account

(Customer under 18 years of Age)

1. Get Form-B.

2. Get ID card of Guardian.

3. Get Income Proof of Guardian.

4. Get Signatures of guardian as per procedure for account opening.

Photo Account

(Sign weak, or in Weak Urdu)

1. Get Weak Signature indemnity signed.

2. Get Vernacular form signed (in case of Sign in Urdu).

3. Affix “Signed in Our Presence” Stamp.

4. Get two photos (One on SS Card, One on AOF).

5. Affix Photo Admitted Stamp on photos and sign twice.

6. Affix “All cheques to be signed in presence of bank officers” stamp

(Once on SS Card, once on AOF).

7. Can’t give and take mandate of account.

Thumb Impression /Parda Nashen ID card

1. Get two photos attested by town Nazim /Gazetted officer.

2. Get two CNIC attested by town Nazim/Gazetted officer.

3. Indemnity signed that I don’t have any other proof that this is my picture.

Online Account

All accounts are marked online except for FCY accounts. If you fill in the AOF.

Housewife Account

There is no need for any income proof, but if heavy transactions are to be carried

out, then get the source of income, i.e. husbands salary proof, proof of selling

land/property etc.

Student Account

Get Student ID card (Valid), fee challan /receipt etc.

THE CARING BANK

Table.7

Check List for Opening an Account

Sole Proprietor Partnership Company

1. NIC 1. NIC of all Partners 1. Copy of Certificate of

Incorporation (Attested by

Company Secretary)

2. Proprietor

Declaration /

Undertaking (Bank’s

Format ON

LETTERHEAD)

2. Account Opening Request

ON LETTERHEAD + Account

Opening Form to be signed by

all partners

2. NIC copies of all directors

(Attested by Company Secretary)

3. Company stamp 3. Partnership Mandate form to

be signed by all partners

(Bank’s Format)

3. Memorandum AND Articles of

Association (Attested by Company

Secretary)

4. NTN 4. Partnership Deed (on

stamp paper) ATTESTED BY

NP + Signed by ALL Partners

4. Copy of Board Resolution with

Company Seal (Bank’s

Format ON LETTERHEAD)5. Company stamp (with

Company’s name and Partner)

5. List of Directors on letter head

(Attested by Company Secretary)6. Registration Certificate

(Form C) incase of Registered

Partnership

6. Latest copy of Form - 29

(Attested by Company Secretary)

7. NTN 7. Signing authority on letter head

with A/c opening request

8. Company Stamp 9. A/c Opening form to be signed

by All Directors 10. NTN

NTN is must in all company accounts.

THE CARING BANK

Table.8

Stamp Specimen

Fig.7

Fig 7

Requests

Cheque Book Issuance

1. Get sign on Requisition (Front and Bank) and verify them.

2. Enter in the purchase order slip as mention below.

3. Deduct Charges (Rs. 5 per leaf) for example 25 leaves cheque book.

THE CARING BANK

Company Name

Proprietor

Company Name

Partner

Check list for Opening Accounts (Individuals)

Salaried Business Landlord

1. CNIC 1. CNIC 1. CNIC

2. Employment

Certificate/Sala

ry Slip/

Appointment

Letter

2. Letterhead + Stamp

OR

NTN in Business Name

+ Visiting Card

OR

Partnership Deed

2. NTN

OR

Fard Name

Dr. Customers Account 125

Cr. Cheque Book Charges Recovered 125

4. Send this Po to operation Manager after reviewing.

5. Operation Manager or Branch Manager will send the requisition .on the

said email address till 3Pm.

6. Next day till 11Am cheque books will receive.

7. Get customer’s signature on slips and send list of cheque books to the

vendor, and verify sign from the SS card.

8. Sign and write date in the slip next to customer’s sign.

9. Enter series in system against that customer from Account Operation.

10.Get authorized from Manager Operation.

Cheque Book Third Party Delivery

1. Sign on requisition for third party authority OR get thirds party authority

signed.

2. Take ID card of Third Person (Bearer).

3. Get CNIC verification request from the Bearer and print out Verisys.

4. Get Bearer sign on authority/requisition and on Cheque Book Register.

5. Send third party letter to customer, attach copy with requisition.

6. Get written acknowledgement on the letter before activating the cheque

book (or via phone in special cases).

7. File another copy of the third party letter in the Third Party Letters file.

(This copy is with the TCS Receipt).

Lost Cheque Book

1. Stop payment on lost cheque.

2. Manager Operation will issue FORM B + Indemnity.

THE CARING BANK

3. Issue cheque book against form B after verifying signs of the customer

and the guarantor. Cheque book issued on form B charges are Rs. 500.

Change of Address

1. Sign on Request (Verify Sign, Affix Received Stamp).

2. Change in System.

3. Print out changes, debit invoice attach with request.

4. Get authorized and send change of address letter to customer.

5. Attach copy of the letter with TCS receipt with the request and file with

AOF.

Third Party Mandate

Third party mandate is an authority that the account holder gives to a third party

to sign on his/her behalf. It is not given to everyone, the Manager Operation

needs to approve the operation.

1. Get third party mandate signed by the customer and the third party.

2. Get CNIC’s of both the customer and the third party.

3. Get Verisys.

4. Get the third party mandate approved by both the Branch Manager and

the Manager Operation.

Stop Payment

If a customer looses their cheque book, then that customer will have to come to

the bank and firstly report the loss and then stop payment, by telling the series of

cheque he has lost. By stopping payment, the customer is guaranteed that no

THE CARING BANK

illegal payment is made from their account. The process for stopping payment,

after the customer tells that he has lost is cheque book is that he fills a ‘Form B’,

which is same as a cheque book requisition form and an indemnity form, stating

no responsibility on behalf of the bank if any illegal payment is made before the

time of announcing a cheque book lost.


2. Mark stop payment in System (Record Received and Marked Time on

Request).

3. Deduct charges, attach debit invoice with request (Rs. 200 per cheque +

FED, Rs. 500 Max for full cheque book +FED).

Dr. Customers Account 220

Cr. Service Charges Recovered 200

Cr. FED on Others 20

4. Attach Stop payment register with request.

5. Send Stop payment Letter to customer, attach copy with request (along

with TCS Receipt).

6. Enter in Stop payment register (current / saving).

7. File in Stop payment file. (Current / saving).

Sign Change Request


2. Get ID card from customer.

3. Get new SS Card sign.

THE CARING BANK

4. Delete old sign in system.

5. Get new sign authorized and uploaded in system.

6. Attach request with AOF with cancel old SS card..

7. Mention date of change of signature on SS card.(W.e.f)

Dormant/Inactive Account


2. Get ID Card.

3. Unmark in system.

4. Attach Print out with request.

5. Get authorized.

6. File with Manager Operation.

Statement issuance

1. Sign on Request (Verify Sign, Affix Received Stamp)

2. Give statement to customer.

3. Deduct Charges by.

Dr. Customer A/c Rs. 55

Cr. Service Charges Recovered Rs. 50

Cr. FED on Others Rs. 5

4. After deducting charges, file request in the Statements file.

Bank Statement and Bank Balance

A bank statement tells the whole activity of a bank account over a period of time.

Customers often come and want their bank statements and have to fill a form,

THE CARING BANK

relating to the time period for which the bank statement is needed. As part of my

internship, I was to assist the customer to fill the ‘Bank

Statement Form’ and printed statement is given through the banks software.

Often customers want to know their accounts balance over the phone and thus I

had to tell them their account balances using the banks information system “Bank

Smart”

Zakat Exemption Request

Zakat is deducted on Pak Rupees Saving Accounts and on TDR’s. If a customer

does not want to pay Zakat he has to

1. Give a ZAKAT DECLERATION on Rs. 20 Stamp Paper.

2. Verify Sign of customer on the declaration and affix Received Stamp.

3. Make changes in system (Marking customer’s Fiqah under ‘Zakat’).

4. Enter in Zakat Register

Non Muslims are also marked under ‘Zakat’ in Account Maintenance. There

Verisys should show their Religion as Non-Muslim.

Clearing Department

Inward clearing

THE CARING BANK

In inward clearing cheques of our customer which are presented in any other

local or out of station bank for payment are come back to the bank to honor.

These cheques are received through NIFT (National Institute of Facilitation

Technology). These cheques are examine date, amount in figure and words,

signature of customer and stamps. If all above mentioned particulars are in order

then check customer account to inquire about sufficiency of balance to pay. If

balance is sufficient then cheque is cleared and payment is made. In case of

local Bank Alfalah Islamic or conventional branch the credit is given through

IBCA(Inter Branch Credit Advise). In case of local bank other than the bank

Alfalah the credit first given to the Main office of Bank Alfalah Islamic, SBP have

all banks main offices accounts, then transfer the fund to the respective branch

main office and their main office give credit to the respective branch.

Stamps by Bank Alfalah Islamic

One stamp that is signature verification.

Stamps by sending bank

Three stamps used by the sending bank

Special Crossing

Banker Discharge stamp at the back+ Signature of authorize officer.

Clearing stamp(Date must be that at which cheque is presented)

Return of the Cheque

Cheque can be returned on following basis,

THE CARING BANK

Amount in figure and words not matched.

Signatures differ.

Pre dated check.

Date of presentation of check expired.

Insufficient balance.

Mutilated cheque.

Stop payment by customer.

Diseased account.

Wrong stamps..

Wrong date on stamp.

Dormant account.

Outward Clearing

In outward clearing the cheques of the banks other than the bank Alfalah

presented by the customer on Bank Alfalah counter. Out ward clearing is of two

types

Local Outward clearing

In local outward clearing the cheques of the local banks other than the bank

Alfalah presented by the customer on Bank Alfalah counter. Clearing department

sent these cheques through NIFT to the respective local branches. After

stamping and entering in their register. NIFT deliver the cheque to their

respective local branch. That cheque become inward clearing for that bank and

repeats the process as mentioned before in inward clearing and give credit to its

Main office, SBP have all banks main office accounts, then transfer the fund to

the respective branch main office and their main office gives credit to the

respective Bank Alfalah branch.

Stamps on the cheque by Bank Alfalah Islamic In local out ward clearing

Three stamps are used

THE CARING BANK

Special Crossing

Banker Discharge stamp at the back+ Signature of authorize officer.

Clearing stamp (Date must be that at which cheque is presented).

Out of station Clearing

There are two ways of out of station clearing, these are

Inter city

In out of station clearing outward clearing the cheques of the out of station

clearing banks other than the bank Alfalah presented by the customer on Bank

Alfalah counter. Clearing department sent these cheques through NIFT to the

respective out of station clearing branches. After stamping and entering in their

register. NIFT deliver the cheque to their respective local NIFT of that city. That

local NIFT deliver the cheque to their respective local branch. That cheque

become inward clearing for that bank and repeats the process as mentioned

before in inward clearing and give credit to its local Main office of that city, SBP

local have all banks main office accounts, SBP of that city transfer the credit to its

branch of that city in which Bank Alfalah Islamic branch need the credit then

transfer the fund to the respective branch main office and their main office give

credit to the respective Bank Alfalah branch.

This method is not used quite often because the status of the cheque can not be

determined. Usually prefer Outward bills for clearing. If cheque is send in this

type of clearing, nothing mentioned in effects of that account, it takes 4-5 working

days to clear the cheque. Clearing charges are 0.15% of the amount of that

cheque + Rs.150 courier charges.

Stamps on the cheque by Bank Alfalah Islamic In intercity out ward

clearing

THE CARING BANK

Four stamps are used

Special Crossing

Payees Account will be credited on realization + Signature of authorize

officer.

Clearing stamp(Date must be that at which cheque is presented).

Intercity clearing.

Outward Bills for clearing (OBC)

Another way of out of station clearing is outward bills for clearing. In this type of

clearing out of station cheque are received, sent to the respective city Bank

Alfalah Islamic branch after stamping and giving number. Those cheques

become local outward clearing for that city Bank Alfalah Islamic branch. That

branch clear that cheque as mentioned before in local out ward clearing. When

that cheque is realized the credit given back to the branch who send it for

clearing through OBC. This credit transfer is given through IBCA.

If Bank Alfalah Islamic Don’t have branch in that city, cheques are sent to Bank

Alfalah Limited conventional branch. If conventional branch is also not there the

directly sent to the respective bank’s branch. In that case the credit can’t transfer

through IBCA which uses only for Bank Alfalah. Then the

Bank Alfalah Islamic request that bank to make the demand draft in favor of their

branch for realization of that cheque.

This method is used quite often because the status of the cheque can determine.

If cheque is send in this type of clearing, it will mentioned in effects of that

account, it takes 4-5 working days to clear the cheque. Clearing charges are

0.15% of the amount of that cheque + Rs.150 courier charges. NIFT is not used

in this type of clearing.

Stamps on the cheque by Bank Alfalah Islamic In intercity out ward

clearing

THE CARING BANK

Four stamps are used

Special Crossing

Payees Account will be credited on realization + Signature of authorize

officer.

OBC stamp with number..

Remittance Department

Cheque

Whenever a cheque is presented at the counter the cashier after a clear

supervision make payments and he finds any ambiguity he returned the cheque

unpaid. The bearer of the cheque sign the cheque in front and twice at back of

the cheque.

Instrument used for transfer of money

Pay order: Used to transfer money within the city

Demand Draft: Used to transfer money outside the city

Pay Order

“Pay Order is a negotiable instrument made by the bank, on account of a

customer, to pay on order the specified amount to the directed person (payee)”.

Pay Orders are used to make guaranteed payment or to guarantee transfer of

money, most importantly with in the same city. Pay Order is always drawn on the

bank that has issued it. Rs 105 are charged for each pay order.

Explanation

THE CARING BANK

When a person requires a Pay Order, he is asked to complete the prescribed

application form in which the amount of pay order is to be stated. Certain amount

of commission and advance tax is charged on issuance of pay order. After

having the total amount deposited in the bank (in cash or through cheque, in

case of account holder), pay order is issued in favor of the payee

Like cheques, when pay orders issued by Bank Alfalah Limited, are presented in

other banks to get them deposited in the payee’s accounts, they constitute the

outward clearing for those banks and inward clearing for Bank Alfalah Limited

The officer checks all the details in the application, makes out the charges for the

transfer that the customer will pay and then make the pay order for the customer

and pass the following entry

Customer A/c

Pay order payable

When the customer in favor of whom the pay order was made gives the pay

order to his branch, the entries passed are

Pay order payable

Customer A/c

Demand Draft

“A Demand Draft is a negotiable instrument issued by the bank, on account of a

person, and drawn on its own branch in a specific city or on the branch of

another bank in that city (in case bank doesn’t have any branch there),

requesting it to pay the specified amount to the person named on it”.

Demand Drafts are used to make guaranteed payment or to guaranteed

transfer of money, most importantly out of the city. Demand Drafts are always

made for out of the city payments. Or transfer.

Explanation

THE CARING BANK

Suppose a customer requests to provide him a DD made on his account for a

particular city like Karachi. Then, after having the total amount (including

commission and advance tax) to be deposited with application form, demand

draft is issued in favor of the specified person in Karachi (supposed) and is

drawn on Bank Alfalah Limited, Karachi Branch. So, when this demand draft is

presented by payee in any bank, it constitutes the inward clearing of Bank Alfalah

Limited, Karachi Branch.

There are two types of situations for transfer of money through demand drafts

Outward DD’s

When a customer comes to Bank Alfalah to make a DD to transfer money

outside the city is known as outward DD. The customer will fill the details in a

DD application form, and will attach a cheque or pay cash as he wish.

Then the officer will check all the details and make a demand draft for the

customer and pass the following entries:

For Cheque: For Cash:

Customer A/C Sundry A/c

Head Office Head Office

THE CARING BANK

Inward DD’s

This is the procedure adopted when the issuing branch sends copy of the

instrument as an advice. When the bank receives the advice, the officer will pass

the following entries

Head Office A/c

DD Payable A/c

When the customer comes with the DD to get his payment, the following entries

are passed:

DD Payable A/c

Cash

If that customer is a Bank Alfalah account holder then the following entries are

passed

DD Payable A/c

Customer Account

Call Deposit Receipt (CDR)

Bank Alfalah Limited also issues Call Deposit Receipts (CDR).

“It is an instrument issued by the bank on account of a customer & in favor of a

person, to pay the specified amount”.

CDR’s are issued to make payments, especially when a company goes for some

tenders or for purchase of government securities. The bank enjoys the benefit of

keeping funds deposited until the payment is not made. During this time, the

bank uses the deposit and earns income on that.

THE CARING BANK

Cancellation of PO.DD or CDR

After issuance of Pay Order, Demand Draft or Call Deposit Receipt by BAL-IBD,

if any one of these has to be cancelled by the customer, it is returned in the bank.

For cancellation original document must be presented. These instruments can

only be cancel by the instrument issuing branch. For CDR the organization for

which it is made must stamp it on back side to release the payment. Then, after

deducting the cancellation charges of Rs.100, the remaining (net) amount is paid

to the customer through Cash Payment Voucher.

Inter Branch Transfer

In inter branch transfer the customer request through an application to transfer

the cash from one account to another account like city school maintains the

salaries account in Bank Alfalah Islamic it can request the bank to transfer

amount from salary account to different staff members account.

Online Transfer

In online transfer first of all your account should be online. All Bank Alfalah

Islamic and Bank Alfalah Conventional branches are online and they are

connected. When the customer request the online transfer there is a module in

Bank Smart Software they open that module and hit that account in which online

transaction needed. They can only debit and credit that account , Signature can

also verified for that account. But details of that account only have by the

branches that maintain that particular account. It will take 5-10 minutes for online

transaction depends on network. Flat rate of Rs. 105 is charged per transaction.

THE CARING BANK

Product and Services

The branch is dealing in the following Riba free consumer products

Alfalah Musharaka Homes

Alfalah Car Ijarah

Alfalah Hilal Card

Alfalah Musharka Homes

With Alfalah Musharaka homes, you can participate with Bank Alfalah-Islamic

Banking Division (BAL-IBD) in joint ownership of property where BAL-IBD invests

a certain amount, usually up to 80% of the

property value. Through monthly payments – a

composite of rent for use of property and

purchase of BAL-IBDs’ Musharaka shares/units

in the property – to BAL-IBD you will be able to

increase your stake in the property every month.

Fig 8

The rental component will be readjusted every month to reflect your growing

share of ownership in the property. Following purchase of all Musharaka units

initially owned by BAL-IBD you shall become the sole owner of the house 8with a

free Title to the property.

THE CARING BANK

The Alfalah Musharaka Homes product can be used in multiple situations,

giving you pure Islamic solutions for your desired objectives.

Purchase an already constructed house (Alfalah Buyer).

Purchase a plot and subsequently construct upon it (Alfalah Builder).

Renovate, extend, restore and enhance your already owned housing unit

(Alfalah Renovation.).

Transfer your existing exposure of housing finance facility from another

financial institution to our Riba-free facility.

You have the option to choose tenures for the purchase of units from

between 3 to 20 years* * 3 to 7 years in case of renovation.

Alfalah Car Ijarah

A Shariah compliant car-leasing scheme

with added features such as

No upfront registration charges

No upfront insurance premium

No rentals before delivery of car.

The facility applies to all locally-assembled

new cars

Fig.9

Up to Rs 4 million. Used cars not older than three years can also be

considered.

Bank contributes up to 70% and 30% by the customer.

THE CARING BANK

Alfalah Hilal Card

Carry your bank account in your wallet with

Alfalah HilalCard Bank Alfalah Islamic

Banking Division (IBD) offers Alfalah HilalCard

to its customers for a conscious free spending

in a modernized form of currency that

provides you with a wide range of accessibility

using VISA’s worldwide network.

Fig 10

Alfalah HilalCard can be utilized for all your financial needs around the world,

round the

clock, wherever VISA cards are accepted locally and Internationally, giving you a

more secure and convenient mode of payment.

The Alfalah HilalCard is an International VISA Debit card which gives you an

unlimited access to your current/savings (musharka) account with a simple

swipe, at more than 1 million ATMs and 27 million outlets around the world.

The reasons that make Alfalah HilalCard different from others:

HILAL CARD IS A BUY NOW, PAY NOW OPTION.

4 No monthly repayment

4 No interest charges

4 Backed by a customer maintained current/savings (Musharaka) account

4 Your limit is your balance

HilalCard can be used electronically at any retail outlet or ATM that

accepts any VISA cards.

THE CARING BANK

Features

24/7 ATm cash withdrawl facility for customer of

BAL/IBG customers-Rs50 k per day

Other 1 link bank Customer

VISA international users

Balance Inquiry

Mini account Statement

Fast cash

Pin Change

Funds transfer on ATMs-Rs 50 k per day

Utility Bills payment for

Electricity

Gas Bills

Mobile Phone Bill Payment

BAL credit card Bill payment on ATM

Cash –Deposit function on selective BAL ATMs

Money Gram

Money gram is an international cash transfer facility. Through this

facility funds can be send any part of the world to beneficiaries in

Pakistan and can be received in any of the Money Gram

authorized BAL branches.

MG is strictly a person to person transfer of cash

Bank Alfalah limited, in collaboration with MoneyGram, offers remittance service

to Pakistan. MoneyGram is person to person money transfer service that allows

consumers to receive money in just few minutes.

THE CARING BANK

Secure and reliable

An extensive network of quality agents, linked by computer, will transfer your

money safely and ensure that it is handled with

care and without delay. Thousands of people already use the MoneyGram

service all over the world.

Locker Service

Locker service is provided by the bank to its account holders of the following

nature

1. Small

2. Medium

3. Large

This service is categories as on the basis of the value as shown in the table

Locker Value/Rs Charges p.a

Small 5 00k Rs 1000

Medium 750 k RS 2000

Large 1000k Rs 3000

Table.9

THE CARING BANK

Financial Analysis

Profitability Ratios

The continued viability of any bank depends on its ability to earn an appropriate

return on its assets and capital. Good earning performance enables a bank to

fund its operations, remain competitive in the market and increase or decrease in

market funds.

1. Return on Capital Funds

Formula = Net mark up Received

Capital Funds)

2009 = 6835605 = 34.57%

19770260

2008 = 6928926 = 50.03%

13766673

2008 20090

10

20

30

40

50

60

percentage

percentage

chart.1

THE CARING BANK

Interpretation

This ratio relates the net profits to the amount of capital funds that have been

employed in making that profit.

The above given ratios suggest that the profitability of the bank has decreased

last year indicating less profitable operations of the bank.This ratio shows a weak

financial position of the bank.

2. Return on Assets

Formula = Net income after taxes

Total Assets

2009 = 897035 = 0.23%

389070055

2008 = 1301301 = 0.37%

348990764

2009 20080

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

percentage

Chart.2

THE CARING BANK

Interpretation

This ratio indicates the profit earned by the bank on the resources employed. As

far as BAL is concerned, we observe an decrease in the utilization of the

resources. It has decreased to 0.23 % in the year 2009 from 0.34 % in the year

2008; the reason behind the slight decrease in the profit may be due to the lack

of efforts by the management.

3. Return on Deposits

Formula = Net income before taxes

Total Deposits

2009 = 1016316 = 0.312%

324759752

2008 = 1794720 = 0.59%

300732858

2008 20090

0.1

0.2

0.3

0.4

0.5

0.6

0.7

percentage

percentage

Chart.3

THE CARING BANK

Interpretation

Interpret This ratio indicates to what extent deposits which represent funds

mobilization on the part of the bank contribute towards income generation.

Although the other ratios regarding the profitability are showing satisfactory

position of the bank but still bank need to increase its utilization of resources in

order to increase its profitability because the banks have to pay heavy taxes on

their profit and this ratio is indicating that bank’s income is decreasing.

4. Income to Expense Ratio

Formula = Income

Expense

2008 20090

10

20

30

40

50

60

percentage

percentage

Chart.4

Interpretation

THE CARING BANK

2009 = 4071527 = 37%

11001542

2008 = 3543357 = 35.58%

9957130

This ratio signifies the proportion of the expenses that are causing to generate

income The ratios calculated above gives a clear picture of the bank’s

operations. This ratio is increasing from year 2008 to 2009 With respect to the

banking expansions this ratio is showing a very good picture as we know the

expansions required lot of expansions, although the operating expenses of the

bank are increasing but their proportion of increase is not alarming.

In short, the bank in an attempt to maintain at a good level of liquidity, has a low

level of profitability but there is a continuous push in the profits and there are

chances that the bank will reach at a point of high liquidity and profitability.

Liquidity Ratio

Liquidity can be defined as

“The bank’s ability not only to meet possible deposit withdrawals but also to

provide for the legitimate needs of the economy as well”

5. Advances to Deposit Ratio

Formula = Advances

Total Deposits

2009 = 188042438 = 57.9%

3542759752

2008 = 191790988 = 63.7%

300732858

THE CARING BANK

2008 200934.5

35

35.5

36

36.5

37

37.5

percentage

percentage

Chart.5

Interpretation

It demonstrate the degree to which bank has already used up its available

resources to accommodate the credit needs of its customers.

This ratio, a comparison of funds generation and its funds mobilization, indicates

the total loans sanctioned by the bank in relation to total amount of money

deposited with the bank stands at 57.9%compared with the last year figure of

63.7%. This shows that the bank has less potential to advance additional loans.

Total loan able funds roughly measured by the deposits are sufficient to enable

the bank to make additional loans without recourse to more or less continuous

borrowing.

6. Deposit to Total Asset Ratio

THE CARING BANK

Formula = Investment

Total Assets

2008 200919

20

21

22

23

24

25

26

percentage

percentage

Chart.6

Interpretation

is an indication of BAL’s funds management policies. The funds allocation to the

financial institutions has increased to a great extent despite the fact that still it

holds a small proportion relevant to the total resources raised by the bank. It is a

positive indicator in the sense that the financing to the banks are the most secure

ways of lending. Considering the economic conditions of the country, it seems to

be the best alternative available to the bank.

7. Debt Ratio

Formula = Total Liabilities

THE CARING BANK

2009 = 99159957 = 25.4 %

389070055

2008 = 75973238 = 21.7%

348990764

Total Asset

2009 = 366936635 = 0.94%

389070055

2008 = 331946025 = 0.95%

348990764

2008 20090.934

0.936

0.938

0.94

0.942

0.944

0.946

0.948

0.95

0.952

percentage

percentage

Chart.7

Interpretation

It shows the relationship between total assets and liabilities. Debt ratio is

decreasing with the passage of time which is good for bank.

8. Capital Adequacy Ratio

THE CARING BANK

Formula = Capital Funds

Total Assets

2007 = 12099 = 6.64%

182172

2006 = 9619 = 5.79%

166033

2008 20095.2

5.4

5.6

5.8

6

6.2

6.4

6.6

6.8

percentage

percentage

Chart.8

Interpretation

This ratio indicates the extent of the funds employed by the bank in the total

resources as shown in the balance sheet. This ratio has been increased with a

good margin.

9. Capital Funds to Risk Assets Ratio

THE CARING BANK

Formula = Capital Fund

Risk Assets

2009 = 19770260 = 10.5%

188042438

2008 = 13766673 = 7.1%

191790988

2008 20090

2

4

6

8

10

12

percentage

percentage

Chart.9

Interpretation

This ratio takes into account the difference between cash and marketable

securities & other kind of assets. Cash & marketable securities, which are risk

less items, are excluded to find out the true picture of the capital adequacy. In

case of BAL the ratio is increasing.

Concluding Remarks

THE CARING BANK

1) Total income of bank is increasing which shows its good position

2) Operating expenses have increased due to formation of new branches

3) Net income before tax and provision has increased and after tax has

decreased due to tax provision increase including operating expense and

interest expense more interest.

4) Investments and deposits show a very good sign because they are

increasing with a large proportion

5) Shareholder equity is also increasing with a high proportion.

6) A total asset shows a better position of the Organization.

THE CARING BANK

SWOT Analysis

SWOT is stands for strengths, weaknesses, opportunities and threats. SWOT

analysis is a careful evaluation of an organization’s internal strengths and

weaknesses as well as its environmental opportunities and threats. In SWOT

analysis the best strategies accomplish an organization’s mission by exploiting

an organization’s opportunities and strengths while neutralizing its threats and

avoiding its weakness. During my internship I also observe these factors of bank

and made a conclusion which is as follows:

Strengths

Bank Alfalah Image

Bank Alfalah is a reputable financial organization and is well known all over the

Pakistan. Perception is of producing a high quality services. Since, inception of

Bank Alfalah, it has moved rapidly in expanding branch network and deposit

base, along with making profitable advances and increasing the range of

products and services bank have made a break-through in providing premier

services at an affordable cost to our customers.

Bank Alfalah has been awarded an AA- (double A minus) and an A1+ (A one

plus) in the long and short term respectively by the PACRA. These rating denote

very high credit quality and very low expectation of credit risk.

The main source of a financial institution is public savings in this regard public

confidence plays a vital role. So, the confidences of customers are the main

strength of Bank Alfalah.

In order to maintain an effective communication of information regarding the

need of valued clients bank has designed its website to be as user-friendly as

possible.

THE CARING BANK

This facilitates to pursue the path of excellence and customer satisfaction

through delivering higher quality of services, thereby adding synergy to our

existing management expertise, financial strength and profitability. Hence, it’s a

channel of communication for the delivery of quality products and services that

enhance value to our stakeholders.

Customer Care

The Bank not only provides high quality services but it also look for the comfort

and convenience of the clients, BAL always preferred their customers.

Market Share

BAL has covered much of the potential market and the net profit is increasing

years after years. Deposits and advances have sufficiently increased.

Large number of diversify Products

This is also its main strength as it has diversified in many products in its not only

in its conventional but also in Islamic banking

such as:

1 Debit card/Alfalah Hilal card

2 Visa Card

3 Car Financing/Cra Ijarah

4 Home Financing?Musharaka Home

5 Money Grams

6 Import and Export Facility

7 Agriculture Financing

Islamic Banking

Bank Alfalah IBG bank is the reknown bank in Islamic banking sector.

Following the Islamic mode of businesses or Riba free banking It’s

banking network in Pakistan with many of them online branches in major

cities of the country Lahore, Karachi, Gujranwala, Faisalabad, Islamabad,

Peshawar and Rawalpindi.

THE CARING BANK

Automatic Operations

The operations performed by the bank are highly automated that result in

assurance for the customers that their transactions are completed reliably,

efficiently and securely.

Full Day Banking

One can avail the benefit of the services provided at the bank till 6:00 P.m. which

is highly useful for those customers who find it difficult to leave their officers in

the morning..

ATM Network

The bank has the largest ATM Network cross the country. The customers of BAL

withdraw access their funds any time at all the ATM Sites .

Customer Oriented Network

The priority banking centers of the bank offer an unmatched where the customer

receives highly privileged services in a highly elegant environment. It gives the

chance of experiencing new standards in banking. Designed specially for those

who appreciate only the finest things in life,Priority Banking offers the very

highest levels of personalized banking to match customer’s unique status.

Electronic Banking

The revolution in the banking in the form of electronic banking operations have

opened avenues of excellent, efficient and quick services saving the time and

costs of the customers and fortunately BAL is among those few banks who are

already reaping the benefits of electronic transactions.

Electronic Fund Transfer

BAL management is quite prepared to adopt the latest advancements in

technology resulting in revolution in the banking operations such as check

clearing process, computer based teller equipment, automatic teller machines,

and electronic funds transfers among the others.

THE CARING BANK

Branch Network

It is the greatest strength of the Bank. With the expansion of bank branches all

over the cities in Pakistan has increased its market share and No. of customer.

The branch network is according to the target market and the people look very

satisfied with the banking system and their progress too.

Sound Marketing

Skillful marketing of the products is being achieving countrywide goals of Bank

Alfalah Limited.

Phone Banking

Every account holder can confirm its balance on Phone and may ask for any

query. There are also 24 hours help lines for customers

Weaknesses

As per Bank policy, advertising and publicity is not extensively emphasized.

Through advertisement customers could be kept abreast with the products and

services.

The main focus of Bank is major cities of Pakistan. It is direly needed to extend

its network and people should be educated about the functioning of bank. Since,

Bank Alfalah has strong set up in UAE and Middle East, therefore, specifically

those areas of Pakistan should be targeted where large number of people is

working abroad. Hence, bank could avail an excellent deposit rate by using its

annual budget specified for network extension. Hence it weakens its progress.

THE CARING BANK

Short Term Approach and Risk-aversive

Bank Alfalah always introduce new product to compete in the market but does

not take initiative, which shows that BAL plans in Short terms . Critics says that

BAL has become risk aversive.

Low Job Satisfaction

Understanding and the effective management of the human resources is the

most difficult challenge faced not only by the bank but by all the organizations.

Even though the people have been sacrificed in the new organizational

developments, it is becoming clear that the true lasting competitive advantage

comes through human resources and how they are managed.BAL seems to not

focusing

on this highly critical issue as the job satisfaction level of the employees working

at BAL, was quite low.

Lack of Specialization

This famous and useful concept given by Adam Smith in 1776 seems to be

missing in the bank. The employees are constantly rotated from one job to

another job of totally different characteristic in the view of giving them the know-

how of the working in all the departments. But I think this is not a very good

tactics used by the management. Otherwise the situation might be like this ‘Jack

of all and master of none.’

Centralization

There is a high degree of centralization in the bank. Almost all the decision-

making is in the hands of the upper management. But centralization is effective

up to a certain level otherwise it becomes inefficient and at times costly too. I

personally observed that delay occurred in the operations of the employees only

due to the fact that they had not got any instructions from the head office.

THE CARING BANK

Opportunities

The life cycle of an organization is comprised of threats as well as opportunities.

If we say, today the rates of challenges are too high but simultaneously the rate

of opportunities is also high. It is mandatory to try to make progress with

consistency as well as to adapt changes with the needs of time, in order to cope

up with both conditions.

In the prevailing scenario, Bank Alfalah could penetrate further and could capture

various corporate customers in addition to the retail customers by expanding

their network.

In addition to the excellent routine banking, it has earned a good name by

offering special products like car financing, home financing and credit card. So,

the penetration of these products could enhance the market share.

In the rapidly growing industry of Pakistan, launching of another SBU, Alwarid

Mobile will be an excellent addition towards the credibility as well as

enhancement of Bank Alfalah’s market share.

Bank Alfalah has launched another division known as Islamic Banking. This

new aspect will also attract a large number of people, who don’t want to deal with

interest bearing banking. Hence, it’s a new opportunity where competitors are

limited.

Diversification

They may enter in new business or any other consumer-durable product in order

to promote their name, by introducing Loan for the students, small businesses,

and handicraft industry.

THE CARING BANK

These are positive external environmental factors effecting the organization.

1) It deals in bulk business.

2) A large amount of foreign investment is attracted.

3) Strong potential for growth

4) Steady increase in Customer Deposits

5) Overseas Operations

6) Branches In Remote Areas

7) Islamic Banking

8) Sharp increase in imports and exports

9) Attractive rate of return

Threats

While doing business, threats are part of the game. Especially, in this era, most

of the financial institutions are working as Private Limited Company and facing or

have a fear of threat from their competitor as well as new entrants.

In order to maintain as well as to enhance the market share, banks always try to

introduce new schemes / packages. Hence, the environment is very much

innovative and adaptive to the needs of customers.

Though Bank Alfalah has a strong footing and maintain a good number of loyal

customer, still bank has threats in various sectors:

a. In Car Financing MCB & UBL are threats however, the expected

car financing of ABN Ambro could also be a threat for Bank Alfalah.

b. In Home Financing Union Bank or to some extent NBP are

threats.

c. In credit cards, Bank Alfalah captured the market share of Citi

Bank and Standard Chartered Bank. Till yet the bank has no

prominent threat. But, the launch of Askari Bank Master Card and

Union Bank Card might be threat after some time.

THE CARING BANK

State Bank Regulation

As the Bank introduces unique products so they face problem if State Bank Of

Pakistan employ taxes on them which force them to increase the rate of Interest.

Competitors

The Bank focuses to compete all the Banks operating in Pakistan, whether

national or multinational. The major threats of Bank Alfalah Limited are Al Faysal

Bank, Bank Al Habib, Askari Commercial Bank. Union Bank Limited, Standard

Chartered Bank.

High Employees Turnover

As discussed above, the job satisfaction level of the employee is very low

resulting in high turnover, which is bad for any organization as there are huge

monetary and non-monetary costs involved in the fresh recruitments

THE CARING BANK

SKILLS ACQUIRED

8 week internship at Alfalah bank will surely impact my career in a positive way.

Many things I have learnt there .I have come to know that how to deal with the

customer at bank and how to facilitate with the basic information. During this time

period I this training made me capable of opening an account and what are the

in formations required from customer.KYC(know Your Capital) is the considered

very important in banking. I also came to know how clearing department works

and which are the parties involved in it what is the procedure of clearing for

inward and outward clearing.

I am pleased to have an a good working experience in remittance department.

There was very strict rule and regulation to be followed in this department in

connection to the cash room.

Working in this department provide me additional information about DD (Demand

Draft), PO (Pay Order) and CDR(Call Deposit Receipt). I learnt

What is demand draft, pay orders how it is prepared and which parties are

involved in it? I am now quiet familiar with the clearing procedure for OBC and

the internal transfer at bank.

In short this whole was a good experience at the Bank because this was a

challenging environment for every one who was working there.

THE CARING BANK

Conclusion

The whole experience of internship was very good. I enjoyed my stay at the

bank. The staff and overall environment of bank is very supporting. Though I am

a commerce student and in the beginning I was unsure about my decision of

selecting a bank for internship. This was because I feared the lack of knowledge

of many of the finance related terms and jargons which will be used in my new

working place. But the employees and their proper guidance aided me in

understanding the operations and functions well.

The 8 weeks spent at Bank Alfalah Limited IBG Kotabdul Malik branch, no doubt

a source of immense learning for me. This practical training program did not only

help me acquire loads of knowledge about the predominant functions performed

by banking companies, but also imparted a lot of training as regards the set of

behavioral traits which distinguish a particular person from the rest of the lot in a

professional environment.

At this point it certainly is significant to write a word of gratitude for the

University’s administration, which makes it sure, that all the students get an

exposure to practical life in relatively well-reputed organizations.

I must share the fact that writing this internship report was an evenly memorable

experience as actually ‘doing’ the internship. I truly hope that this report also

certifies the fact that all of my worthy teachers performed their duties of academic

guidance and moral mentoring with utmost efficiency and effectiveness.

It seems that the priority is given to the corporate customers in Bank Al Falah as

the individuals from middle class have to remind the management of certain

branch to do the needful for them. Customer is the king and customer always

right. Bank is earning profit from the customers. Bank should have a proper

relationship with corporate as well as individual customers. It is recommended

that the management should stress on having satisfactory relationship with

individual customers because they can also provide the revenue in term of profit.

THE CARING BANK

Recommendation

Alfalah bank IBG is a very good organization. It has earned repute for good

public dealing and also with the business point of view. Here the customers do

not feel any difficulty dealing with the bank due to the hard working staff. In spite

of this effective and efficient behavior exhibited by the bank, there always exists

a room for improvement. I have some suggestions, which can help bank in

further escalating its status as a serving organization. Following are various types

of recommendations for Bank Alfalah and by following these recommendations

this banking company can achieve batter performance in all aspects considered

necessary for competing in insurance market.

1. Bank Alfalah Limited should provide greater facilities to its employees, and

give them bonuses for their hard work.

2. The pay should revise after two year.

3. Bank short give longer lasting impact of caring banking over the clients by

providing them extra care.

4. Bank Alfalah should look for more market in corporate sector

Job Rotation

There should be job rotation for the employees working in the banking either in

the same department or in some other departments.

Banking Professionals

The company should hire banking professionals having experience in their

respective fields that will boost the performance of the company as currently

MBAs are produced for this field so they should be hired for enhancing the

performance of company.

THE CARING BANK

Attract Customers

The banking company should offer such policies which would attract customers

which are denied by other banking in the market.

BAL is totally centralized bank. In order to improve the working condition of the

branches, modern techniques of decentralization must be adopted. Some of the

authority must be delegated to the lower management and the staff, up to some

extent. This will improve the confidence of the employees, their working

performance and may result in quick and prompt attenuation paid to the

customers.

Control and Expansion

Expenditures must be in control, which currently are very high

Canteen for Employees

Because full day banking system is followed in Alfalah , employees have to stay

in bank for long durations of time. They already have no proper lunch break

timings. Bank must be very careful that in striving to facilitate its customers, it

must not risk the satisfaction level of its employees. They must be provided with

all basic requirements, one among which is the in-house canteen from where

they can get the food whenever they feel like having it.

Socializing

The most important recommendation is that the branch should have more of

social parties and evenings where the employers are invited so that this becomes

a source of motivation. Because working the entire time makes one socially dull.

Also this will aid the employees to develop a family culture and more association

with their working place. Thus together they will be able to out perform the

existing competition in current scenario of banking sector.

THE CARING BANK

Bibliography

www.bankalfalah.com 20.07.2010 to 25.07.2010 8.00 pm

www.bankalfalahIslami.com 08.08.2010 to 12 .08.2010 9.00pm

www.google.com 25.08.2010 7.00pm

Annual Report 2008 & 2009(Audited by A.F.Ferguson & co. Chartered

accountant Karachi Dated March16,2010)

Banking Circulars

Financial Reporting &Analysis, 10th Edition By Charles H.Gibson

(Business School Edition Printed Access Card)- (Apr 27, 2006)

THE CARING BANK

http://www.amazon.com/Financial-Reporting-Analysis-Accounting-Information/dp/0324657420/ref=sr_1_2?s=books&ie=UTF8&qid=1283938068&sr=1-2

http://www.google.com/

http://www.bankalfalahIslami.com/

http://www.bankalfalah.com/

Appendix

THE CARING BANK

final Report

Documents

Transcript of final Report