Download - 49158690 Askari Bank Report Original

Internship Report of Askari Bank Ltd.

INTERNSHIP REPORT ONASKARI COMMERCIAL BANK LIMITED

Syeda Mariam Nida

Submitted in partial fulfillment of the requirementsfor the degree of Master / Bachelor of Business

Administration

At

National University of Modern LanguagesIslamabad, Pakistan

June 2010

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© Copyright by Syeda Mariam Nida, 2010

DEDICATION

"I owe immense sense of gratitude to my beloved Parents & family members

who not only support me financially throughout my career and also gave

confidence to me. I also dedicate the project to my teachers and friends who

remained the source of encouragement throughout.

At the last very humbly raising my hands to pray for success in world, good

health and long life of my parents and teachers whose encouragement and

prayers enable me to complete my studies".

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ACKNOWLEDGEMENT

By the Grace of Almighty Allah, the most Merciful, the most Beneficial, I'm

today submitting my internship report; I have the pearls of my eyes to

admire the blessings of the compassionate, omnipotent, the Merciful and

the beneficent Allah who is the entire source of knowledge and wisdom.

Further more, I would like to acknowledge the help on this as well as many

other writing projects over the years that I received from my teachers who

taught me over the whole of my course in this university. Second, 1 want to

give special thanks to two of my teachers who specially helped me in making

this project i-e Madam Hina Shahab. Next, I would like to acknowledge the

interaction that I have had with my colleagues, Sir Abid, Sir Sajjad Haider, Sir

Rizwan Malik, Miss Uzma, Sir Aftab Iqbal, and Sir Tahir Jamil during my

internship in the Askari Commercial Bank (G.T Road Branch, Kharian.) and

helped me to learn a lot. In particular I would like to acknowledge the total

support and standards of excellence provided by my teachers and long time

Management Sciences staff. I can never forget the education,

encouragement, and scholarly values that I received from all the teachers

when starting out in my academic career. Over the course, I would have

been very lucky to have been associated with excellent management

students; I would like to thank them all for teaching me as much as I have

learned from them.

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EXECUTIVE SUMMARY

The banking structure in Pakistan comprises of the following types. State

Bank of Pakistan, Commercial Bank of Pakistan; Exchange Banks, Saving

banks, Cooperative banks, specialized , credit institutions. The state bank of

Pakistan is the Central bank of the country and was established on July 01,

1948. The network of bank branches now covers a very large segment of

national economy. The State Bank of Pakistan issues the shares of these

periodically. Bank employees and other common peoples can also purchase

these shares and earn profit.

This internship report is based on the job, which I did in Askari Commercial

Bank as Internee in the Different departments from June 9th 2008 to July

26th 2008.

In remittance department like any other bank NBP also have instruments for

transferring of money, Telegraphic Transfer, Mail Transfer, cash department

both deposits and withdrawals go side by side. This department works under

the accounts department and deals with cash deposits and payments. This

department maintains the following sheets, books, and ledger of account

cash received voucher sheet.

Cash paid voucher sheet, Paying-in-slip, Cheque Book, Cash balance book.

Bank provides this facility to the people who need advance money to meet

their requirement. Party dealing with other banks financial condition of

borrower business and as a first step credit proposal is being made.

Demand Finance, Cash Finance, Foreign bills purchased. Finance against

imported goods, Finance against foreign bills, Export Refinance Part I (Pre

Shipment) & others. In foreign exchange, ACBL is dealing Foreign Currency

Accounts, Foreign Remittances, and Foreign Bills for Collection, Imports &

Exports. Letter of credit facility is being provided by ACBL in foreign

exchange.

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SWOT & PEST Analysis prepared primarily for decision-making. They play a

dominant role in setting the framework of managerial decisions.

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TABLE OF CONTENTS

Title page

Approval Page

Dedication

Acknowledgement

Executive Summary

Table of Contents

Chapter-1 Introduction

1.1 Definition and purpose of Bank 09

1.2 History of Askari Commercial Bank 09

1.3 Vision statement 10

1.4 Mission Statement 10

1.5 Goals of Askari Commercial Bank 11

1.6 Objectives of Askari Commercial Bank

11

1.7 Organization Structure 11

1.8 Level of Customer service, Rating & Achievements

12

Chapter-2 Product & Services of Askari Commercial Bank

2.1 Products 15

2.1.1 Deposits 15

2.1.1 (a) Local currency deposits 15

2.1.2 Advances 16

2.3 Products

16

2.3.1 Ask card

16

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2.3.2 Ask power

16

2.3.3 Ask Smart Cash

17

2.3.4 Askari Master Card

17

2.3.5 Askari Traveler's Cheques

18

2.4 Services 18

2.4.1 Foreign Remittances 18

2.4.2 Telegraphic Transfer 19

2.4.3 Demand draft & Pay Order 19

2.4.4 Mail Transfer 19

2.4.5 Bank Draft 20

2.4.6 Letter of Credit 20

2.4.7 Askari Commercial Bank ATM 20

Chapter - 3 Departmentalization

3.1 Cash Department 24

3.2 Clearing Department 26

3.3 Advances Department 27

3.4 Foreign Exchange Department 28

3.5 Deposit Department 30

Chapter No-4 ACBL SWOT Analysis

4,1 Strengths 35

4.2 Weaknesses 36

4.3 Opportunities 36

4.4 Threats 37

Chapter-5 PEST Analysis of ACBL

5.1 Political & Legal Environment 40

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5.2 Economic Trends 41

5.3 Socio Cultural Environment 41

5.4 Technological efforts 42

Chapter-6 Human Resource Analysis of ACBL

6.1 Recruitment and Selection 45

6.2 Training and Development 46

6.3 Performance and Evaluation 47

6.4 Compensation 48

Chapter – 7 Internship Experience

7. Introduction

1st week 50

2nd week 51

3rd week 51

4th week 51

5th week 51

6th week 52

Experience and Learning 52

7.1 Worked In Different Department

52

Dynamic and Advanced Approach 52

Customer Orientations and Personalized Service

52

Professional Style of Management 53

Healthy, Competitive Working Environment

53

Modern Banking Policies 53

7.2 Negative Dimensions of Experience and Learning 53

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Chapter-8 Conclusion and Recommendation

8.1 Recommendations 56

8.2 Conclusion 57

8.3 References 59

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CHAPTER 1

ORGANIZATION OVERVIEW

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Introduction of Askari Commercial Bank Limited- ACBL

1.1 Definition and purpose of Banks

Banking is the business of providing financial services to consumers and

businesses. The basic services a bank provides are checking accounts, which

can be used like money to make payments and purchase goods and

services; savings accounts and time deposits that can be used to save

money for future use; loans that consumers and businesses can use to

purchase goods and services; and basic cash management services such as

check cashing and foreign currency exchange. A broader definition of a bank

is

"Any financial institution that receives, collects, transfers, pays,

exchanges, lends, invests, or safeguards money for its customers."

Banking services serve two primary purposes:

First, by supplying customers with the basic mediums-of-exchange (cash,

checking accounts, and credit cards), banks play a key role in the way goods

and services are purchased. Without these familiar methods of payment,

goods could only be exchanged by barter, which is extremely time-

consuming and inefficient.

Second, by accepting money deposits from savers and then lending the

money to borrowers, banks encourage the flow of money to productive use

and investments. This in turn allows the economy to grow by letting people

to purchase cars or houses, and businesses to expand and build the new

factories that the economy needs in order to produce more goods and

services. Enabling the flow of money from savers to investors is called

financial intermediation and this is what banks are established for.

1.2 History of Askari Commercial Bank

The banking sector has witnessed a dramatic change during the last ten

years with the

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development ofAskari Bank, which is not only redefining priorities and focus

of the banks, but also threatening the domination of traditional players.

Askari Bank Limited (ACBL) works as a Unit of Army Welfare Trust was

established for the Welfare of Army Officials. The office of Army Welfare

Trust is situated at AWT Plaza, Rawalpindi. AWT offers the "AWT Saving

Scheme" to the army officials only. AWT has itsunits as under:

Askari Associates

Askari Leasing

Askari General

Private Business

Textile Mills

Cement Industry

Askari Commercial Bank

The story begins with the incorporation of Askari Commercial Bank limited in

Pakistan on October 09, 1991, Askari Bank Commenced (begin) to operations

in April 1992, as a public limited company. The bank is listed on the Karachi,

Lahore and Islamabad Stock Exchanges and the initial public offering was

over subscribed by 16 times.

While capturing the target market share amongst the view banks, Askari has

provided

good value to its shareholders. Its share price has remained approximately

12% higher than the average share price of quoted banks during the last

four years.

Askari Bank has expanded into a nation wide presence of 140+ Branches,

and an Offshore Banking Unit in Bahrain. A shared network of over 800

online ATMs covering all major cities in Pakistan supports the delivery

channels for customer service. As on December 31, 2004, (he Bank had

equity ofRs. 6.016 billion and total assets ofRs. 107.168 billion, with over

475,000 banking customers, serviced by a total staff of 2,118.

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Askari Bank is the only bank with its operational head office in the twin cities

of Rawalpindi-Islamabad, which have relatively limited opportunities as

compared to Karachi and Lahore. This created its own challenges and

opportunities, and forced as to evolve an outward-looking strategy in terms

of Askari market emphasis. As a result, Askari developed a geographically

diversified assets base instead of a concentration and heavy reliance on

business in the major commercial centers of Karachi and Lahore, where most

other banks have their operational Head offices.

1.3 Vision Statement

"To be the Leading Bank in the Region"

1.4 Mission Statement

"To be the leading private sector bank in Pakistan with an international

presence, delivering quality service through innovative technology and

effective human resource management in a modem and progressive

organizational culture of meritocracy, maintaining high ethical and

professional standards, while providing enhanced value to all our

stakeholders, and contributing to society".

1.5 Core Values / Strategic Goals of ACBL

Commitment:

To deliver quality services through innovative technology and effective

resource management.

Integrity:

To create relationship with the customers based on trust, and to be a reliable

organization for the customers.

Fairness:

To be fair with the customers, to make fair dealings, and to create fair

relation, and to be fair the job.

Team Work:

To work with the organization and to achieve the goal by mutual efforts.

1.6 Objectives of Askari Commercial Bank

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The following are the outlined objectives of the Askari bank limited.

• To build & sustain a high performance culture, with a continuous

improvement

focus.

• To develop a customer-service oriented culture with special emphasis on

customer care and convenience.

• To build an enabling environment, where employees are motivated to

contribute to their full potential.

• To effectively manage and mitigate all kinds of risks inherent in the

banking

business.

• To maximize use of technology to ensure cost-effective operations,

efficient management information system, enhanced delivery capability and

high service standards.

• To manage the bank's portfolio of businesses to achieve strong. and

sustainable shareholder returns and to continuously build shareholder value.

1.7 Organizational Structure

Organizations cannot function without proper arrangements for its specific

tasks and duties. For this purpose organizations are divided into

departments. "The process of grouping jobs according to some logical

arrangements" is called departmentalization. The basis of

departmentalization is commonly product, customers, function and location.

Askari Bank has done its departmentalization forming a matrix structure.

Following are the main divisions of the organization.

1.7.1 Organizational Chart;

Organizational chart shows the linkage of employee to employee infect it

covers every single individual who is working in one specific organization for

common goal. Organizational chart of Askari bank shows the step by step

relation from president to senior vise president then in branch hierarchy it

shows the step bye step relation from vise president to peon.

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Organizational is shown in appendix.

Army welfare trust was established mainly for the welfare of

army officials.

The office of army welfare trust is situated at AWT PLAZA

Rawalpindi.

AWT offers the "AWT Saving Scheme" to the army officials only.

AWT has further as units.

1. Askari Associates

2. Askari Leasing

3. Askari General Insurance

4. Private Businesses

a) Textile Mill

b) Cement Industry

c) Petroleum

5. Askari Commercial

Askari Association deals with the share holding.

Askari General Insurance & Askari Leasing are registered at stock

exchange.

Cement Industry, Firstly produced "Nizam Cement".

Recently AWT invested their capital with Mobil named as "Askari

Mobil.

1.8 Level of Customer Service, Rating & Achievements

• Customer Services:

Knowing your customer and their needs is the key to any business and

success. Their

products and services are structured to touch and improve the quality of

lives of all

segments of society. It's their constant endeavor to provide the most

efficient and

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personalized service to customers.

Their products are as diverse as their market segments. They have

structured and syndicated financing arrangements working capital finance,

Balancing Modernization-Replacement (BMR) facilities, financing of

international trade, customer credit, small business loans, ' credit cards and

investment products for the individual saver.

Askari Bank is proud of the pioneering role in providing the most modern

technological 'service to its customer based, which today exceeds 350,000

relationships.

• Credit Rating:

During the year, the Pakistan Credit Rating Agency (PACRA) maintained both

our long term and shot term ratings at 'AA' and 'A+', respectively (the late

being the highest possible in this category). These ratings signify a very high

credit quality and very strong capacity for timely payment of financial

commitments.

• Awards & Achievements :

Over the years, ACBL have received several awards for the quality of our

banking service to individuals and corporate. ACBL have been declared "The

Best Bank in Pakistan" by the Global Finance magazine for the years 2001

& 2002. Also, ACBL have been given the "Best Consumer Internet Bank"

award for Pakistan by the same magazine for the year 2002. In 1994,1996

and 1997, ACBL received Euro money and Asia money awards. Askari has

A1+ rating for short-term obligations - the highest possible for the category,

while the long-term rating stands at AA. Askari Bank won the prestigious

"Best Presented Annual Accounts" awards for 2000 and 2001 from the

Institute of Chartered Accountants of Pakistan and the Institute of

Cost and Management Accountants of Pakistan, for the services sector.

For the past four years, ABL have received prizes from the South Asian

Federation of Accountants for "The Best Presented Annual Accounts"

for the financial sector, in the ASSRC region.

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Over the years, Askari Bank has proved its strength as a leading banking

sector entity, by achieving the following firsts in Pakistani banking.

First Pakistani Bank to offer on-line real time banking on a

countrywide basis.

First Bank with a nation-wide ATM network

First Bank to offer Internet Banking Services

First Bank to offer E-Commerce

solutions

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CHAPTER 2

PRODUCTS & SERVICES

OF ASKARI BANK

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Products and Services:

The product & services of Askari commercial bank limited are developed

keeping in view the customers needs & wants, & the expectation that the

customer attaches with its financial institutions.

A product ACBL includes all those services which customer normally required

for effectively managing his business.

ACBL offers the following financial services to its customers.

1) Deposits

2) Advances

3) Products

4) International banking services

2.1.1 Deposits

One of the basic functions of commercial banking is to receive deposits.

ACBL accepts

deposits in both local & foreign currency

2.1.1 (a) Local currency deposits:

Current Account

PLS Saving Account

Term Deposit

Notice Deposit

Askari Faida Account

Askari Special Deposit Account

Value Plus Saving Account

Askari Advantage

Askari Faida Account

Installment account

Compound advantages

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2.1.2 Advances:

Advances are major sources of earning of income for commercial banks.

Banks attracts surplus balances from the customers at low interest rates &

makes advances at higher interest rates to the individuals or business firms,

ACBL offer these facilities in two forms:

Funded facilities

Non-Funded facilities

2.3 Products;

1. Personal finance

2 Mortgage finance

p. Business finance

4, Askcar (car finance)

5. Askcard

6. Value plus

7. Traveler cheques

8. Askpower

2.3.1 ASKCARD:

"ASKCARD" is an Askari Bank's Debit Card. ASKCARD has been introduced as

a shopping companion. It lets the customer do shopping, dine at restaurants,

pay their utility bills, transfer funds, withdraw and deposit cash through ATM

anywhere, anytime.

2.3.2 ASKPOWER:

ASKPOWER is the name for Askari Bank's Pre-paid Card. Although, it is a

"stored value" card, but unlike an ATM or debit card, ASKPOWER is not

connected to any account. It is an instant cash card that can be used at any

ACBL ATM or other ATMs carrying 1-Link symbol, 1-Net Banking and at all

designated Point of Sale terminals. The card offers remarkable convenience

for:

• Everyday purchases

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• Payment of bills

•Safe alternative for carrying cash during traveling, special occasions, and

emergency back up.

• Easy transfer of money from one ASKPOWER card to other ASKPOWER

card.

• The ideal accessory for students

• As a pre-paid card, ASKPOWER has its own built-in spending limit; the

customer

can set how much money is loaded to it and how frequently it is topped up.

• Money can be conveniently loaded to any card either by depositing cash

at any ACBL Branch or through the ATM

• I-Net Banking from another ASKPOWER Card.

Key Features:

• Issued to ACBL / Non-ACBL customers.(NIC Card holders)

• Minimum Issuance Limit: Rs. 500/-.

• 100% customer acceptance.

• Card can be reloaded anytime.

• Transfer of money from one card to another card.

• Payment of Utility Bills through ATMs and Internet.

• Instant access to money; 24 hours a day, 7 days a week.

• Easy cash withdrawal through ACBL ATMs or ATMs carrying 1-Link or Orix

Leasing network symbol.

• Fast, private, safe and secure option for cash transfers.

• Replacement of card in case of loss, theft, damaged or defective card.

2.3.3ASK SMART CASH

This personal line of credit is set up with a specified credit limit agreed upon

by customer and ACBL.

• The customer can withdraw cash from his credit line as and when they

require.

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• The markup is charged only on the utilized amount and for the number of

days the credit is used.

• The markup is lower than a credit card.

• Personal loan and balance transfer facility.

• Finance Amount up to Rs 1 Million revolving credit line

2.3.4 ASKARI MASTER CARD:

The distinguishing characteristics are:

• No joining fee

• Worldwide acceptability:

This card is acceptable all over the world. It provides services at thousands

of locations in Pakistan and over 14 million establishments all over the

world. The customer can receive their monthly billing in Pak Rs, regardless

of the currency of purchase.

• Traveling safety net

In case the travel tickets are purchased on Askari master card, they are

automatically covered under the travel insurance plan for up to Rs.8 million

on a gold card and Rs.4 million on silver card.

2,3,5 ASKARI TRAVELER'S CHEQUES:

Askari Bank's Travelers Cheques are available in the denomination of

Rs.l0,000/-.the

distinguishing feature of these travelers cheques are:

Light and safe

No service charges for purchasing Askari traveler's cheques. They can

be brought against cash or debit to the personal account of the

customers

The customers are charged only 0.10% commission whenever the

traveler cheque is encashed after 30 days of holding

• High security lithograph

• Ultra violet printing \

• Special thread

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• Anti scanner pyramid design

• Unique micro lines

• Easily refundable in case of loss and theft

2.4 Services of Askari Commercial Bank

2.4.1 Foreign Remittances:

Remittance department performs the function of remitting funds i.e. to

transfer funds for customers from one location to another. The transfer of

funds may be from one branch to another or from one bank to another

Remittances mean "the transfer of money or fund from one place to another

place through bank". It may be "inland remittance" or "Remittance" Inland

remittance may be classified as:

1) Within locality.

2) Outside locality.

Within Locality:

When a branch situated in Islamabad is required to send the draft to any

other branch

situated in the same locality, the process will say to be within locality. I.e.

ACB main branch Islamabad, send any draft to ACB Apara branch, this is

known as within locality.

2.4.2 Telegraphic

Transfer:

Telegraphic transfer is an important mode of remittance. It is the quickest

mean of transferring the funds from one place to another place by the use of

telephone or

telegraphic.

Now a day, new technology is used for this purpose i.e. fax, e-mail. The big

traders and

businessman use this method of remittance in this method of remittance the

purchaser is not responsible for the dispatch.

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How One Can Apply:

The purchaser fills an application form in which he mentioned the sum of

(T.T) name of payee, accounts number of payee and place of payment etc.

The purchaser signs the application form and the bank charge the

commission for this purpose.

2.4.3 Demand Draft & Pay Order:

For safe, speedy, and reliable way to transfer money, ACB Demand Drafts

and pay orders are available for customers at very reasonable rates. Any

person whether an account holder of the bank or not, can purchase a

Demand Draft from a bank branch. A demand draft is an order drawn by a

bank on its branch or on another bank in a different place requiring the later

to pay on demand the sum of money specified in the draft. Pay order is just

like demand draft except the pay order is made for local transfer of money

whereas demand draft is meant for remittances of funds from one city to

another.

2.4.4 Mail Transfer:

Mail transfer draft is one of the bank modes of remittance. Mail transfer is

issued by one branch of bank to another branch of the same bank by

instructing to branch to pay the other branch by issuing mail transfer

receipts.

In M.T the purchaser is not responsible for dispatch, but the bank will be

responsible for dispatch.

How to Apply:

The purchaser fills application forms, which includes the amount of M.T name

of payee, account number of payee, name of the bank branch. Place of

payment and signature of purchaser. Bank charges the commission for this

service.

2.4.5 Bank Draft:

Bank draft is the most important type of remittance. Draft is an instrument

issued by a bank.

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Draft is issued by one branch to another branch out of the city. The

difference branches of same bank can issue the bank draft to each other and

it is also called the banker cheques i.e. the main branch of ACB in Islamabad

issued the draft to the ACBL Daska.

2.4.6 Letters of Credit

ACBL is committed do offering its business customers the widest range of

options in the area of money transfer. If you are a commercial enterprise

then our letter of Credit service is just what you are looking for. With

competitive rates, security, and ease of transaction, ACBL Letters of Credit

are the best way to do your business transactions.

2.4.7 ATM;

Automated Teller Machine is a hi-teq. Invention in the field of the banking, it

facilitate that a depositor can withdraw money at any time without the need

of banking personnel. We can also deposit money with the help of this

machine. But it is not so much practiced here because of sonic drawbacks.

In these terms and conditions, "Cardholder" means the individual to whom

the ATM Card is issued, "Bank" means Askari Commercial Bank Limited and

"Bank Account" means the account of the Cardholder maintained with the

Bank.

1. The issue of ATM card (ASKCARD) entitles the Cardholder to avail the

facilities

of the Bank's Automated Teller Machines (ATMs) also referred to as

machines.

2. It is a condition of issue and use of the Card that the Cardholder

maintains a Current or PLS-SB Account with the Bank at one of its

branches in Pakistan. In the event of the stopped for any reason,

whatsoever the Card shall immediately be returned to the Bank by the

cardholder and its validity shall cease to have any effect on the date of

such closure of A\C henceforth.

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3. The card shall remain the property of the Bank at all times. The bank

may, at its sole discretion and without prior notice, cancel or refuse to

re-issue or renew the card or suspend its use for the time being and

call for its return at any time, in which case the Cardholder shall

immediately return the Card to the Bank.

4. The cardholder shall be responsible for the payment of any taxes,

duties, levies, which may be attracted, to payments related to the

issuance and use of the card by the cardholder.

5. The cardholder undertakes not to disclose his/her Personal

Identification Number (PIN) to any other person. In the event of the PIN

becoming known to someone other than the cardholder, that person

may be treated by the Bank as an acting agent of the cardholder. The

Cardholder indemnifies the bank against all losses or damages which

may occur as a result of the PIN becoming known to anyone else from

any source whatsoever.

6. The bank shall not be responsible for any loss or damage arising

directly or indirectly from any malfunction of the Card or ATM or any

technical or non-technical defect or breakdown of the machine and/or

any part thereof or the temporary non-availability of case in such

machines.

7. Except as otherwise prescribed by law, ACBL shall have no

responsibility or liability for any act or omission or inability to perform

any of its obligations hereunder which results from any cause beyond

ACBL's control.

8. The Cardholder agrees to accept that any cash or instrument(s)

delivered through ATM with the use of Card shall be, for the all the

purposes, at the entire risk and sole responsibility of the Cardholder.

The bank would hence be assuming no responsibility whatsoever in

this behalf. The Cardholder understands and accepts that the crediting

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of account, as specified on the frontal side of the envelope, designed

for the purpose, will be subject to:

I. In the case of Cash Delivery: Upon physical checking and verification of

the currency note(s) that would be found contained in the envelope,

and confirmation of the correctness of the particulars mentioned on

envelope.

II. In the case of Delivering the Instrument(s): Upon checking and

confirmation of the correctness of the particulars of instrument(s) that

would be found contained in the envelope and after its clearance

and/or realization of its proceeds through lodgments in collection as

per procedure.

III. The physical checking and verification of cash so delivered shall be

carried out by the Bank through its two officials, whose count, checking

and findings will be accepted by the Cardholder as correct and final.

The Cardholder also expressly

waives its rights to, in any way, question or challenge the same.

IV. The amount stated on the ATM screen or on the printed transaction

record/slip shall not for any purpose whatsoever be takes as conclusive

of the status of the

Cardholder's account with the bank.

V. The Cardholder further undertakes to accept full responsibility for all

transactions made by the use of the Card whether or not made with

his/her knowledge/authority or consent and he/she shall accept the

Bank's record of transactions as binding for all purposes.

VI. The Cardholder shall take every possible due and proper care to

prevent the Card from being lost, mislaid or stolen and shall not pass

the Card to any other person. He shall notify the Bank immediately if

the Card is lost, mislaid or stolen or if it comes into the hands of a third

party.

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CHAPTER 3

DEPARTMENTALIZATION

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The Askari Commercial Bank is having more than thousand branches in the

country. Main branch of Askari Commercial Bank in Daska deals with

following departments.

3.1 Cash Department

3.2 Clearance Department

3.3 Advance Department

3.4 Remittance Department

3.5 Foreign Exchange Department

3.6 Deposit Department

3.1 CASH DEPARTMENT

Cash department performs the following functions

3.1.1 Receipt

The money, which either comes or goes out from the bank, its record should

be kept. Cash department performs this function. The deposits of all

customers of the bank are controlled by means of ledger accounts. Every

customer has its own ledger account and has separate ledger cards.

3.1.2

Payments

It is a banker's primary contract to repay money received for this customer's

account usually by honoring his cheques.

3.1.3 Cheques and their Payment

The Negotiable Instruments Act, 1881

"Cheque is a bill of exchange drawn on a specified banker and not

expressed to be payable otherwise than on demand".

Since a Cheque has been declared to be a bill of exchange, it must have all

its characteristics as mentioned in Section 5 of the Negotiable Instruments

Act, 1881. Therefore, one can say that a Cheque can be defined as an:

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"An unconditional order in writing drawn on a specified banker, signed by the

drawer,

requiring the banker to pay on demand a sum certain in money to, or to the

order of, a specified person or to the bearer, and which does not order any

act to be done in addition to the payment of money".

3.1.4 The Requisites of Cheque

There is no prescribed form of words or design of a Cheque, but in order to

fulfill the requirements mentioned in Section 6 above the Cheque must have

the following.

a) It should be in writing

b) The unconditional order

c) Drawn on specific banker only

d) Payment on Demand

e) Sum Certain in money

3.1.5 Parties to Cheque

The normal Cheque is one in which there is a drawer, a drawee banker and a

payee, or no payee but bearer,

3.1.6 Types of Cheques

Bankers in Pakistan deal with three types of cheques

a) Bearer Cheques

Bearer cheques are cashable at the counter of the bank. These can also be

collected through clearing.

b) 0rder Cheque

These types of cheques are also cashable on the counter but its holder must

satisfy the banker that he is the proper man to collect the payment of the

cheque and he has to show his identification. It can also be collected through

clearing.

c) Crossed Cheque

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These cheques are not payable in cash at the counters of a banker. It can

only be credited to the payee's account. If there are two persons having

accounts at the same bank, one of the account holder issues a cross-Cheque

in favour of the other account holder. Then the cheque will be credited to the

account of the person to whom the cheque was issued and debited from the

account of the person who has actually issued the cheque.

3.1.7 Payment of Cheques

It is a banker's primary contract to repay money received for his customer's

account usually by honouring his cheques. Payment of money deposited by

the customer is one of the root functions of banking. The acid test of banking

is the receipt of money etc. from the depositors, and repayment to them.

This paying function is one, which is the distinguishing mark of a banker and

differentiates him from other institutions, which receive money from the

public. However the bankers' legal protection is only when payment is in

'Due Course'. The payment in due course means payment in accordance with

the apparent tenor of the instrument, in good faith and without negligence to

any person in possession thereof under circumstances, which do not afford a

reasonable ground of believing that he is not entitled to receive payment of

the amount therein mentioned. It is a contractual obligation of a banker to

honor his customer's cheques if the following essentials are fulfilled.

3.2 Clearing Department

In clearing department, clearinghouse is a device, which enables banker to

settle check and other instruments, drawn on each other.

Askari Commercial Bank Limited is the member of SBP Clearing House and

receives checks The easy, safe and most efficient way is to offset the

reciprocal claims against the other and receive only the net amount owned

by them. This facility of net inter bank payment is provided by the

clearinghouse. The representatives of the local commercial banks meet at a

fixed time on all the business days of the week. The meeting is held in the

office of the bank that officially performs the duties of clearinghouse. The

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representatives of the commercial banks deliver the cheques payable at

other local banks and receive the cheques drawn on their bank. The cheques

are then sorted according to 'he bank on which they are drawn. A summary

sheet is prepared which shows the names of the banks, the total number of

cheques delivered and received by them. Totals are also made of all the

cheques presented by or to each bank. The difference between the total

represents the amount to be paid by a particular bank and the amount to be

received by it. Each bank then receives the net amount due to it or pays the

net amount owed by it.

3.2.1 In-Word Clearing Books

The bank uses this book for the purpose of recording all the cheques that are

being received by the bank in the first clearing. All details of the cheques are

recorded in this book.

3.2.2 Out-Word Clearing Books

The bank uses outward clearing register for the purpose of recording all the

details of the cheques that the bank has delivered to other banks.

3.3 Advances Department

The Credit Management Division of Head Office directly controls all the

advances. As we known bank is a profit seeking institution. It attracts surplus

balances from the customers at low rate of interest and makes advances at a

higher rate of interest to the individuals and business firms. Credit

extensions are the most important activity of all financial institutions,

because it is the main source of earning. However, at the same time, it is a

very risky task and the risk cannot be completely eliminated but could be

minimized largely with certain techniques.

3.3.1 Procedure of Advances:

Following are the steps regarding the sanction of advantages:

I. First the application comes in the branch.

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II. After filling up the application the signature of the party has to be

confirming from their deposits or accounts they have.

III. After that proposal of advances is consider which includes all

particulars about the party such as their name, business, how much

advance they need? Why? Securities, margin etc.

IV. Now this proposal of advance is forward to H.O., which scrutinize

proposal, and if the request is legal then H.O. make it approved for

further processing otherwise cancel the proposal.

V. After the approval the H.O. set some conditions regarding advance.

3.3.2 Credit Worthiness

The following five C's are pillars of credits management for determination of

credit worthiness of a borrower.

3.3.2.1 Character

The expected borrower must be selected as a 'good citizen' in all respects.

Banker's opinion regarding the character may be establishing on the basis of

following source of information:

a) Past credit history showing willingness and ability to pay.

b) Character reference forms other valued customers.

c) Market reputation

3.3.2.2 Capacity

The ascertaining of the capacity of the borrower to repay its obligation

carries a great importance to a banker. Following are three sources of loan

repayments.

3.3.2.3 Capital

What is the volume of the wealth put into business by proprietor or partner

of shareholders in case of limited companies? What is the ability of these

entrepreneurs to meet up emergency losses?

3.3.2.4 Collateral

Securities may be in the name of borrowers or in the name of third parties.

Usually securities against which the finance as allowed are called "Primary"

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whether in the name of borrower or third partners that are offered by the

borrower in addition to primary security/securities are called collateral

securities.

3.3.2.5 Conditions

Terms and conditions must be properly assessed before allowing any finance

and especially in case where the transactions involve more than one country

like opening of letter of credits or issuance of letter of guarantees.

3.4 Foreign Exchange Department

Askari Commercial Bank is providing services of foreign currencies through

foreign exchange department. Foreign exchange department in all

prominent branches like city branch, Airport branch, Chamber of Commerce

branch and many others branches engaged in foreign exchange demand

draft and other negotiable instruments for the presentation of its payment

and also provides excellent services for clearing checks and other inter bank

obligations between the banks.

In this way different banks get checks drawn by the customers on one

another. So, to off set the inter-bank claims 14 branches of SBP are providing

clearing facility for scheduled of banks whose accounts and services are

maintained with it. It is easier for member banks to adjust their claims

against each other in the books of the state bank. services. Foreign

exchange services includes accepting deposits, issuing foreign currency

travelers cheque, providing imports/exports services, foreign currency

remittance, foreign exchange bearer certificates.

3.4.1 LETTER OF CREDIT

Letter of Credit is very useful instruments in facilitating commercial relations

between businesses at various places in the world. Letter of credit state the

limit of credit and the time during which it id held at the disposal of grantee

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but they are neither negotiable nor transferable. Before issuing the letter of

credit the bank demands the following documents:

1. Invoice

2. Purchase Order

3. Import/export license

4. Installation/operating /maintenance manual.

5. Insurance

3.4.2 Documentary Letter of Credit

Parties to a letter of credit:

1. Applicant/Importer

2. Issuing Bank

3. Advising Bank

4. Confirming Bank (if any)

3.4.3 Mechanism of Letter of Credit

Importer and Exporter enter into a contract through Performa invoice to

export and import goods from one country to another. They agree to certain

terms to be incorporated in the letter of credit. Importer applies to his band

of opening of LC, and hence after is called opener or applicant.

After going through their internal procedure, importer's bank opens a Letter

of Credit, in favors of the exporter, who shall, hence after be called as

beneficiary. Opening bank sends letter of credit their correspondent bank in

beneficiary's country for advising to beneficiary such bank is called Advising

Bank. Advising bank, after establishing its authenticity, forwards the letter of

credit to beneficiary under their covering letter. On receipt of letter of credit

the beneficiary ships the goods and prepares documents in terms of the LC

for submission to bank nominated in the LC, as negotiating bank. Beneficiary

submits documents for negotiation to negotiating bank.

Negotiating bank after having determined that documents are strictly in

terms of LC negotiates the documents. (Negotiation means giving value of

documents to beneficiary). On negotiation the negotiating bank claims

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reimbursement from the bank mentioned in the LC as reimbursing bank and

forwards negotiated documents to opening bank. Opening bank on receipt of

documents, examines the documents to ascertain that these conform to

terms of the LC. If found in order, documents are lodged and presented to

opener for payment Opener makes payment for the documents and gets the

documents from opening bank duly endorsed in his favors, for release of

goods.

3,5 DEPOSIT DEPARTMENT

It controls the following activities:

a) A/C opening.

b) Issuance of cheque book.

c) Current a/c

3.5.1 Account opening

The opening of an account is the establishment of banker customer

relationship. Before a banker opens a new account, the banker should

determine the prospective customer's integrity, respectability, occupation

and the nature of business by the introductory references given at the lime

of account opening. Preliminary investigation is necessary because of the

following reasons.

I. Avoiding frauds

II. Safe guard against unintended over draft

III. Negligence

IV. Inquiries about clients.

There are certain formalities, which are to be observed for opening an

account with a bank.

• Formal Application

• Introduction

• Specimen Signature

• Minimum Initial Deposit

• Operating the Account

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1. Pay-In-Slip Book

2. Pass Book

3. Issuing Cheque Book

3.5.2 Qualification of Customer

The relation of the banker and the customer is purely a contractual one,

however, he must have the following basic qualifications.

Type of Accounts:

Current Account.

Saving Account.

Askari Special Deposit Account.

Askari Bachat Certificate.

Notice Deposit.

Term Deposit.

Current account:

In current account there is no interest on it. It is for only transaction

purposes. They are paid on demand. When a banker accepts a demand

deposit, he incurs the obligation of the paying all cheques drawn against him

to the extent of the balance in the account. As there is no profit paid on this

account it is also called chequing account because cheques can be drawn on

it. Current account is mostly opened for business.

Saving account:

The purpose of this account is to induce the habit of saving individuals in the

neighborhood. The profit is PLS saving and ASDA Accounts in ACBL are

chequing accounts paid on the basis of profit and loss sharing at the rate of

8.5% six monthly. The minimum deposit for opening the account is Rs.100/-

Askari special deposit accountant (ASDA ACCOUNT):

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ASDA account is an interest bearing current account interest is paid on it at

the rate of

8.00%. The payment of return is monthly, where as the rate of return with

aspect to the amount of minimum deposit clear from deposit schedules in

annexure. It is also chequing account because cheques can be drawn on it. It

is necessary for this account that the client must maintain a minimum

balance of Rs.0.05 million at the end of the month, no interest is paid. That’s

why it is similar to current account.

Asian Bachat Certificate:

ACB's are long term fixed deposit for 3 and 5 years. These are not term

deposits because payment of return is on monthly basis rather than on

maturity of deposits. The minimum balance requirement is Rs.25000/- and

maximum balance requirement is Rs.1.0 million. If ACB is for 3 years, the

rate of return for 3 years is 12%; if ACB is for 5 years the rate of return is

13.00%. Because in such account the balance is kept for either '3' or '5'

years within the bank no cheque is drawn on it. That's why it is not a

chequing account, but only payment of return is made monthly.

Notice deposits:

Notice deposits are kind of fixed deposits. The minimum balance

requirement for opening the account is Rs.5000/- and payment is drawn on

maturity of the specific period. Notice deposit is of the two kinds:

One for which a prior notice of 30 days and above is required from the

customer before with drawing deposited amount and for which rate of

return is 8%

Second for whom a prior notice of 30 days and above is required from

the customer before with drawing the deposited amount and for which

rate of return is 10%.

Term deposits:

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A term deposit is a deposit that is made for a certain periods of time. At the

end of the specific period, the customer is allowed to with draw the principle

amount.

ACBL term deposits are of types clear in the deposit scheme in the

Annexure. One of them is "Askari" Advantage one month. The rate oftetum

on this account is 12.0% for 4 years. The term deposit account varies from

one month to 5 years, and the minimum balance requirement is Rs.5000/-.

3.5.4 Issuing of Cheque Book:

This department cheque books to account holders. Requirements for

issuing cheque book

a) The account holder must sign the requisition slip

b) Entry should be made in the cheque book issuing book

3.5.5 Current account

These are payable to the customer whenever they are demanded. When

a banker accepts demand deposit, he incurs the obligation of paying all

cheques etc. drawn against him to the extent of the balance in the

account. Because of their nature, these deposits are treated as current

liabilities by the banks. Bankers in Pakistan do not allow any profit on

these deposits, and customers are required to maintain a minimum

balance, failing which incidental charges are deducted from such

accounts. This is because the depositors may withdraw Current Account

at any time, and as such the bank is not entirely free to employ such

deposits.

3.5.6 Saving account

Savings Deposits account can be opened with very small amount of

money, and the depositor is issued a cheque book for withdrawals. Profit

is paid at a flexible rate calculated on six-month is under the Interest-Free

Banking System. There is no restriction on the withdrawals from the sit

accounts but the amount of money withdrawn is deleted from the amount

to be taken for calculation of products for assessment of profit to be paid

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to the account holder. It discourages necessary withdrawals from the

deposits.

3,5,7 Cheque cancellation:

This department can cancel a cheque on the basis of;

a) Post dated cheque

b) Stale cheque

c) Warn out cheque

d) Wrong sign etc

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CHAPTER 4

ACBL SWOT ANALYSIS

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SWOT is an acronym for an organization’s strengths, weaknesses,

opportunities and threats. A SWOT analysis consists of sizing up a firm’s

internal strengths and weaknesses and its external opportunities and threats

in order to get an overview of the organizations strategies and its

environment. The basic purpose of such an analysis is to develop strategies

along with exploiting opportunities and strengths and neutralizing threats

and removing weaknesses.

The SWOT analysis ofACBL as follows:

4.1 STRENGTHS:

4.1.1 E. 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 |aid fortunately

ACBL is among those few banks who are already reaping the benefits of

electronic transactions.

4.1.2 Askari Atm:

The bank has the largest ATM Network across the country. Customers of

ASKARI BANK. can withdraw and access their accounts at any time

through ATM Sites with one link.

4.1.3 Customer Centered Banking:

The priority banking centres are established in every branch of the bank,

where customers receives highly privileged services in a highly elegant

environment. It gives the chance of experiencing new standards in banking.

Priority Banking offers the very highest levels of penalized banking to match

customer's unique status.

4.1.4 Automatic Operations:

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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.

4.1.5 Tele Phone Banking:

Phone banking service is very attractive for those classes of customers who

don't have time to personally come to the bank i.e. banking on the phone

line thus saving the precious time of the customers.

4.1.6 Eight Hours Banking:

One can avail the benefit of the services provided at the bank till 5:00 P.m.

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

officers in the morning.

4.2 WEAKNESSES:

In my opinions these, are the points that might be detrimental to the

efficiency and

profitability of the bank.

4,2.1 Manual Banking:

Although the bank has computerized accounting system but, still the bankers

use to make their entries in the accounting register

4.2.2-Generalizaiton:

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

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

another job for the sake of having the complete know-how of 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 an4

master of none.

4.2.3-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

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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,

4.2.4 Less Training Facilities:

Presently there is no specific training given to the newly hired employees.

Only on the [job training is given to the new employee.

4.2.5 Not Highly Automated:

The bank has still some of the traditional ways of operations in this advanced

technological environment.

4.3 OPPORTUNITIES;

Apart from the ones discussed in External Factors Evaluation Matrix, the

bank is facing the following threats and opportunities currently:

These are positive external environmental factors effecting the

organization.

1. 1 Army accounts: Generally army persons prefer Askari bank. ,

2. Two more branches in remote areas: The bank can work for formers

more.

3. Islamic Banking: Bank can work more in Islamic banking b/c peoples

want Islamic

banking.

4. It deals in bulk business: The bank can work for big business men

more.

5. Sharp increase in imports and exports: The banks have to improve its

letter of credit facility.

6. Technology development and innovation.

7. Business and product development.

8. An unfulfilled customer need.

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9. Arrival of new technologies.

10. Well established position with a well defined market niche.

4.4 Threats

4.4.1 Reduction in Private Credit Investment

The challenges to corporate business in year 2009 were manifold, including

reduction in

private credit investment as a result of slowing down of economy as well as

rising interest rates. The credit investment as a result of slowing down of

economy as well as rising interest rates. The increasing pressure on the

textile industry reduced the lending to this sector. In addition the bank's

corporate loans yields also faced pressure as substitute form of funding

sources are available in the market in form of Islamic financing, mutual

funds, issuance of debt instruments like TFCs and Bonds and the Capital

markets.

4.4.2 Emergence of New Competitors

The bank is facing threats with the emergence of new competitors especially

in terms of foreign banks. These foreign banks are equipped with heavy

financial power with excellent and innovative ways of promoting and

performing their services. The bank has to take initiative in this regard or will

find itself far back in competition.

4,4.3 Political Pressure by ElectedGovernment

The ongoing shift in power in political arena in the country effects the

performance of the (bank has to forward loans to politically powerful persons

which create a sense of insecurity and demoralization in the customer as

well as employees.

4.4.4 Downsizing

The bank is currently acting upon the policy of downsizing which threaten

the environment of the bank Employees feel insecurity in doing their jobs

and work, hence affecting the overall performance of employees negatively.

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4.4.5 Customers Complaints

There exists no regular and specific system of the removal of customer

complaints. Now a day a need for total customer satisfaction is emerging and

in their demanding consequences customer's complaints are ignored.

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CHAPTER 5

ACBL PEST ANALYSIS

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A broad view of market is important when management is interested in

introducing better services for customers. Rapid technological change, global

competition and the diversity of buyers preferences in many markets require

the constant attention of the market vouchers to identify promises business

opportunities, see the shifting requirements of the buyers, evaluate changes

in competitors positioning and guide the choice of which buyers to target

and classify them according to respective segments. Identification of

external and macro factors that influence buyers and thus change the size

and composition of market overtime involves initially building customer

profiles. These influences include:

1. Political and legal environment

2. Economic trends

3. Socio cultural environment

4. Technological factors

5.1.1-Political and Legal Environment:

Political factors include government regulations and legal issues and define both formal and

informal rules under which the firm must operate. Banks are strongly affected by the

political and legal considerations. Current political situation of Pakistan is not

very encouraging. No one can make plane long term objectives or goals in

Pakistan because of political destabilization in Pakistan. Because of political

destabilization many foreign and local investors are not showing their

interest regarding investment in Pakistan. This environment is composed of

regulatory agencies and government law that influence and limit various

organizations and individuals. Some of main political factors which effects

banking sector in Pakistan.

Tax policy

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Employment laws

Environmental regulations

Trade restrictions and tariffs

Political stability

5.1.2-Business legislation has following main purposes:

• To protect banking companies from unfair competition.

•To protect consumers from unfair business practices adopted by banking

companies

• To protect the interest of the society from unbridled business behavior.

5.2 Economic Trends:

The World Bank considers Pakistan a low-income country. GDP is around $166 billion at the

official exchange rate. The population numbered some 167 million in 2008 with a 1.81% growth

rate. No more than 55.0% of adults are literate, and life expectancy is about 64 years. In FY

2008-2009, the GDP growth rate was 3.7%, and unemployment was estimated at 14%. Year-

over-year consumer price inflation averaged 13.6% in 2009. Main inflation drivers include food

and utility prices, the Pakistani rupee’s depreciation versus the U.S. dollar, and higher

international commodity prices. Low levels of spending in the social services and high

population growth have contributed to persistent poverty and unequal income distribution.

Pakistan's extreme poverty and underdevelopment are key concerns, especially in rural areas.

The country’s economy remains vulnerable to internal and external shocks due to internal

security concerns and the global financial crises. According to banking market it

requires better consumer market in volume along with higher borrowing

power. The available borrowing power depends on

Consumer income

Saving rates

Consumption patrons

Rates of interest

Budget deficit

Exchange rates

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Cost of living

Inflation

5.3 Socio-Cultural Environment:

Social factors include the demographic and cultural aspects of the external macroenvironment.

These factors affect customer needs and the size of potential markets. Trends in social factors

affect the demand for a company's products and how that company operates. For example, an

aging population may imply a smaller and less-willing workforce (thus increasing the cost of

labor). Furthermore, companies may change various management strategies to adapt to these

social trends (such as recruiting older workers). A society is shaped by beliefs, norms and

values. People in a society consciously and unconsciously interact with:

Themselves

Others

Organization

Society

Nature

Following are the main factors. Which arise because of change in socio-

cultural environment?

Consciousness about services

Concern for environment

Improved customer relation

Health consciousness

Population growth rate

Age distribution

Career attitudes

Emphasis on safety

5.4 Technological Factors:

Forces of technological advancement- have played the most dramatic role in shaping the lives of

people. The rate of change of technology has greatly affected the rate of growth of economy.

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New technology is creating deep rooted affects which could be observed in long run. The

improvement techniques involved in on line banking. Technological factors can lower barriers to

entry, reduce minimum efficient production levels, and influence outsourcing decisions. Some

technological factors include:

R&D activity

Automation

Technology incentives

Rate of technological change

In brief PEST analysis affects the overall banking companies and provides us

the information about the external macro condition.

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CHAPTER 6

HUMAN RESOURCE ANALYSIS OF ASKARI COMMERCIAL BANK

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6.1 Human Resource Analysis:

Human resource analysis of ACBL is mainly depends on the following four categories.

1. Recruitment and Selection

2. Training and Development

3. Performance and Evaluation

4. Compensation

6.1.1 Recruitment and Selection

Recruitment, assessment and selection are the three key steps for hiring employees. Of these, recruitment

and selection are typically the most challenging for employers. The keys to finding the right candidates at

the right time and hiring them are being strategic and thinking about the organization's future.

ACBL follows two methods for recruitment.

6.1.2 External Recruitment

ACBL develop relationships with guidance and career counselors at colleges and universities and

ask for help in recruiting for open positions. Reach out to professional organizations that are in

line with the organization's mission, and ask to them to list open positions in their newsletters

and emails to members. ACBL consider working with a recruitment firm in this method of

recruitment, especially when the position is at a higher level or requires a specific skill or type of

experience.

6.1.3 Internal Recruitment

ACBL also use this type of method of recruitment for hiring potential employees. In this method

ACBL focuses on skills and experience an applicant must possess. Post an open position

internally ACBL assess qualified candidates within the organization. Consider interns,

volunteers, temporary workers or consultants who may have been working in a similar capacity

to the open position.

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6.1.3 Selection Methods

Once the applicant pool has been narrowed and candidates have been assessed, it's time to make

a selection decision. ACBL think long-term. Is the applicant qualified for the present job as well

as future positions? Look for a candidate with solid experience and new ideas and a fresh

perspective. Weigh his or her willingness to learn. Also, no matter the industry, market

conditions inevitably will change ACBL selects someone who not only can adapt, but also can

flourish under those conditions. ACBL never discount candidates who are making career

changes. For example, someone with five years of corporate-sector experience can bring a

strategic view to a nonprofit organization, while someone from a nonprofit who has made the

most with limited resources can bring a fresh approach to a corporation. ACBL consider other

needs such as diversity, and to follow the guidelines of the Equal Employment Opportunity

Commission.

6.2.1 Training and Development

In general, education is 'mind preparation' and is carried out remote from the actual work area,

training is the systematic development of the attitude, knowledge, skill pattern required by a

person to perform a given task or job adequately and development is 'the growth of the

individual in terms of ability, understanding and awareness.

ACBL fuscous these points regarding Training and Development:

Develop workers to undertake higher-grade tasks.

Provide the conventional training of new and young workers.

Raise efficiency and standards of performance.

Meet legislative requirements e.g. health and safety.

Transfer learning from observation of trained workers.

Receiving coaching from seniors.

Learning via involvement in research, report writing and visiting other works or

organizations.

Lectures and talks by senior or specialist managers.

Discussion group (conference and meeting) activities.

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Briefing by senior staffs.

Role-playing exercises and simulation of actual conditions.

Video and computer teaching activities.

Case studies (and discussion) tests, quizzes, panel 'games', group forums, observation

exercises and inspection and reporting techniques.

Evaluation of the effectiveness of training is done to ensure that it is cost effective, to identify

needs to modify or extend what is being provided, to reveal new needs and redefine priorities

and most of all to ensure that the objectives of the training are being met.

The latter may not be easy to ascertain where results cannot be measured mathematically. In the

case of attitude and behavioral changes sought, leadership abilities, drive and ambition fostered,

etc., achievement is a matter of the judgment of senior staffs. Exact validation might be

impossible but unless on the whole the judgments are favorable the cooperation of managers in

identifying needs, releasing personnel and assisting in training ventures will cease.

In making their judgments senior managers will question whether the efforts expended have

produced:

More effective, efficient, flexible employees.

Faster results in making newcomers knowledgeable and effective than would follow from

experience.

More effective or efficient use of machinery, equipment and work procedures.

Fewer accidents both personal and to property;

Improvements in the qualifications of staff and their ability to take on tougher roles.

Better employee loyalty to the organization with more willingness to innovate and accept

change.

6.3.1 Performance Evaluation

In ACBL Performance appraisal defined as a structured formal interaction between a subordinate and supervisor, that usually takes the form of a periodic interview (annual or semi-annual), in which the work performance of the subordinate is examined and discussed, with a view to identifying weaknesses and strengths as well as opportunities for improvement and skills development.

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In ACBL appraisal results are used, either directly or indirectly, to help determine reward outcomes. That is, the appraisal results are used to identify the better performing employees who should get the majority of available merit pay increases, bonuses, and promotions.By the same token, appraisal results are used to identify the poorer performers who may require some form of counseling, or in extreme cases, demotion, dismissal or decreases in pay. (Organizations need to be aware of laws in their country that might restrict their capacity to dismiss employees or decrease pay.)Whether this is an appropriate use of performance appraisal - the assignment and justification of rewards and penalties - is a very uncertain and contentious matter.

6.4.1 Compensation

In ACBL Compensation includes topics in regard to wage and/or salary programs and structures,

for example, salary ranges for job descriptions, merit-based programs, bonus-based programs,

commission-based programs, etc. (Also see the Related Info (including Benefits). Compensation

is payment to an employee in return for their contribution to the ACBL, that is, for doing their

job. ACBL associate compensation/pay ranges with job descriptions in the organization. The

ranges include the minimum and the maximum amount of money that can be earned per year in

that role. Employees have certain monies withheld from their payroll checks, usually including

federal income tax, state income tax, FICA (social security) contributions, and employee

contributions to the costs of certain benefits.

Professional, management and other types of skilled jobs are classified as exempt. Exempt jobs

get a salary, that is, a fixed amount of money , usually a fixed amount per month. It's not

uncommon for exempt positions to receive higher compensation and benefits than non-exempt

jobs, although non-exempt jobs often can make more money than exempt jobs simply by

working more hours. Unskilled or entry-level jobs are usually classified as non-exempt. Non-

exempt jobs usually get a wage. Non-exempt jobs also get paid over-time, that is, extra pay for

hours worked or on certain days of the week or on holidays.

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CHAPTER 7

INTERNSHIP EXPERIENCE

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Analysis

It is handling government federal and private operation as well. This bank is

providing many facilities like submission of utility bills, salary accounts,

current accounts, different kind of loan schemes, overdraft facilities and so

on.

Other than these benefits it has some weaknesses as well. This bank is not

customer oriented especially pensioners really suffer during getting pension.

There is no proper guidelines and information for customers. They have to do

wait for a long for completion of their desired work. Work load is too high

whereas staff is very low. ATM facility is not available in this respective

branch. ACBL is suffering from low customer orientation and this is a big

marketing threat for it. In this way this can be loose those customers which

have current accounts. Career opportunities are very low; compensation

plans are not well planned.

Employees want more salary and benefits and they are ready to switch their

jobs this can increase ratio of turnover. Jobs are not granted on the basis of

merit.

Introduction:

During my internship I was involved in the following departments.

1 Costumer Service

2 Agri Finance

3 Account Opening

4 Personal Finance

5 Information Technology

6 Credit Card

7 Remittances

1st Week:

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In the first week they gave me detail information about whole organization

and respective branch in which I was working. They gave me detail

introduction about working of ACBL.

Scroll sheets: In 1st week I have made scroll sheets of utility bills, traffic

challans.

One copy of scroll sheet is sent to respective organization e.g.; WAPDA,

PTCL and

so on and one copy is kept by bank as a record.

Manual record keeping of new open Accounts: In 1st week I have also

done manual record keeping of new accounts, in which name of customer,

form and account no and date on which account is to be opened is written

off.

2nd Week:

Voucher making: In 2" week I have learnt that how to make vouchers of

scrolls of utility bills and traffic challans as well. Original copy of branch is

sent to respective institute and copy of it is kept by bank.

Issuance of cheque books: In 2" week I also issue cheque books to old

customers and j new as well. I also receive requisition for cheque book from

very new customers.

Entry of pensioners: In 2nd week I learnt how to keep monthly record of

pensioners and how to give monthly, bimonthly, semiannually and yearly

pensions.

3rd week:

Customer dealing: In 3rd week, I have performed as a front desk person. I

have learnt that how to deal different kind of customer and how to fulfill their

requirements and how to give their desired and relevant information. This

practice increases my patience and high level of control on my emotions; it

enhances my communication skills as well.

Account Opening: In 31 week I came to know about that how a person will

be able to

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open an account. I issues 70 account opening form in a day and guide all

customer one by one and tell them requirements to fill and submit a form.

Within week I receive back these forms and after making necessary

requirements I finalize these forms.

Computerized record keeping: In ^ week, I have also done computerized

record keeping of new opening accounts. I also learnt that how to check the

balance of old and new accounts as well.

4TllWeek:

Token Issue: In the start of 4th week I have worked in cash department and

leamt to issue token to the customers who want to withdraw cash. I also

cash their cheques and give them their desired amount.

5th Week:

Vouchers of un-issued cheques: When cheques are rejected due to certain

reasons these cheques are returned back to their respective departments.

One voucher is made for this purpose on which name of cheque holder and

account no and amount which is to be drawn is written on the back side of

voucher is prepared and sent.

In the last of 5th week I issue forms of different services which are offered by

Askari Bank. I provide all information regarding specific service to customers.

These services include:

1 ACBL rozgar scheme

2 ACBL advance salary scheme

3 ACBL gold scheme

6th Week:

Review of Marketing Practices: In last week I review Marketing practices

of ACBL. That on which basis Marketing is hired and compensated.

Prepare medical forms for each employee: In last week I prepare

medical form of each employee and its family member. I make report of their

last month's visit to doctor and sent it into head office.

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Procedure of Transfer: I have also learnt that how employees are transferred

from one branch to another. I review and finalize their papers of transfer.

Every employee is transferred right after 3 years.

EXPERIENCE AND LEARNINGS

The six weeks long internship at Askari Bank of Pakistan Main Branch Daska

has been a sufficient duration to personally observe and experience the

working and analyze certain factors related to the environment of all the

Departments in the Branch.

7.1 Worked In Different Department:

Dynamic and Advanced Approach

The Bank employed skilled and professional approach to management, which

took a series of successive measures to make the people of Pakistan

banking, and saving-minded. The dynamic approach and personalized

service met the expectations of the customers.

Customer Orientations and Personalized Service

The banker customer relationship attained a new dimension courtesy the

politeness and efficiency of professionally trained staff and fair induction

policies of its Human Resource Department.Convenience of the customers

has been the sole criterion of this relationship. The introduction of different

schemes, good atmosphere, proper guidance and team effort have proven to

be the catalyst in not only improving the financial standing of the bank but

has also been the source of the prestige it holds today.

Professional Style of Management

Although the concept of professional management is still in its transition

stage in Pakistan Askari Bank from the very first day employed skilled and

professional management, which had the capacity to take quick, decisions,

and respond to the changing business conditions.

Healthy, Competitive Working Environment

The obligation to give all its employees an equal chance to succeed has been

one of the most fundamental and challenging responsibilities of the bank. It

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has always provided its employees the scope within which to make the most

of their abilities. In Askari Bank survival, growth and expansion demand

full use of one's own talent and ability. Such a competitive environment was

instrumental in introducing professionalism, which in the ultimate analysis

transformed the entire outlook of the industry.

Modern Banking Policies

With the entry of Askari Bank and a new era, banking underwent a complete

metamorphosis. When Askari Bank challenged the major banks of the time

due to quality services they began to evaluate their policies and were

surprised to find that they had a lot to change. Before long, they began to

change and adopt a more modem and relevant strategy.

7.2 Negative Dimensions of Experience and Learning

• Departmental Problems at the Branch

The following are some of the problems and shortcomings that were

inevitably prominent.

• Deposits Department

In order to save time the addresses filled in the required section of the

account opening forms are filled without confirming that they are

appropriate for using for correspondence purposes in case of any

notifications to be sent to the customers. The present format of the

account opening forms seems more complicated to the lesser-educated

customer and hence he takes it away to be filled with somebody's help,

but unfortunately, rarely comes back.

• Bills and Clearing Departments

The carelessness of the officers at times result in delay of collection, as

the original advice is lost in post and proper filing of the copy is not

done. The same officer of the branch does the posting of the bills and

cheques, clearing and collection that result in unnecessary delay. The

procedure of applying tests is not know to all the officers as it is

practiced by only one of them and hence it causes delay when it is

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applied by the others in case the said officer is absent. The test

application officer works manually and there is no other person to assist

him that results in spending most of the time in applying these.

• Cash Department

Rare instances of fake currency notes result in loss to the branch and the

cashier who accepted them, that affects their work negatively. Manual

counting system by the cashiers is a very time consuming exercise,

especially if there is a rush of customers.

• Advances Department

The filing and record maintenance of the credit related documents is

not done‘‘Efficiently due to lack of computer skills of the related

officers. Lack of infrastructure for carrying out computerized/ automatic

financial analysis of the borrowers' businesses is another shortfall of

this Department.

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CHAPTER 8

CONCLUSION AND RECOMMENDATION

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8.1 Recommendations

These are some recommendations & suggestions, which I think will be

helpful in enhancing the image and performance of ACBL.

People working in the planning department, should not only be

qualified but also experienced and familiar with the working of the

bank.

Scheme should be launching only on the basis of the research work

and should be discussed before they are made available to the

customer.

The entire economics scenario should be taken into consideration. The

minimum amount of deposit should be increased, in this way ACB will

have safer depositors, who will deposit large amount with the bank and

will also reduce the number of depositors so that bank can provide

better services to its existing clients.

Both corporate banking and retail banking should be combined to

reduce costs. There should be combination between FORIX and retail

banking so that those customers, who have defaulted once, are not

allowed loan from the bank again.

Every branch should be made into separate unit and should be

evaluated individually, this way ACB would know in which areas,

localities, function it is not working up to the standard and give the

management a chance to investigate and improve the functions the

function for the particular branch.

There is and immediate need to make a new recruitment policy so that

the bank can get properly trained employees who are suited for the

vacant positions. Political interface especially in recruiting should be

tolerated. Because under the present circumstances of the bank,

educated and skilled people are just what the doctor ordered to

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improve the performance of the bank. After all it is the employees who

make or break an organization.

Performance appraisal should be done on a semi-annual basis rather

than an annual basis.

In this way the employees will be realize his or her short coming and

put in more effort.

Promotions should not only done the basis of seniority but rather

performance and the time period spent in a certain position should

also be considered furthermore, position blockage should be

eradicated.

It is recommended that ACB should train its first line and middle line

managers so that they are able to build good relations with

customers.

When I examined the annual report of ACB, their fixed assets were

very small in number most of their offices in different cities are on rent.

So they have to pay heavy rent, which decreases their profit. ACB

should try to buy their own buildings or even it can give it to rent to

other companies like "State Life" Head Office of ACB is also in State

Life Building.

There is no marketing department is should be created in order to cope with future.

In ancient days the security of money and money management requirements emerge, the

situation for the bank to be established for offering banking function to public and

especially to business person. 17th and 18th centuries are witnessed centuries during

which banks than were privately owned and were involved in financing activities for

merchants, bills collection on behalf of clients.

Feeling the importance of banks in economy of the nation most state government started

to govern banking and started their interface in this sector so that all financial activities

may be monitored. There are various types of banks as per their specialized field of

operation.

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8.2 Conclusion:

Askari bank limited was established as a semi public commercial bank on

November 8, 1949. The primary objective of the setting of the bank was

to purchase jute form the growers in the former East Pakistan in the

country. The bank provides all types of banking services to the

government and private sectors. The overseas branches under a trust

deed the bank also provides services as trustee to national investment

trust including sage custody of securities on behalf of nit in consideration

for annual service charge and commission.

Askari bank limited is placing high priority on automation and it

development. The bank is shifting its focus from routine personnel

administration to human resources development, with due emphasis

being placed on the optional utilization of existing human resources.

Motivating pay structures and performance based on incentives were also

introduced enhance the productivity of employees. Additionally, objective

appraisal system is being instituted to facilities transparent ratings /

promotion. Askari bank limited is working on the restructuring program to

make the bank more attractive with the eventual aim of privatization as

the largest bank in the country with a customer base of 8.5 million. The

key components of the restructuring programmers are reduction-

operating cost; increased in earnings decrease in non-performing loans,

and effective use of information technology.

Askari bank limited brought a great revolution on our banking system by

introducing new products, adopting all the new methods and technologies

requited for an international bank. Askari bank limited is desired to play a

vital role in the development of Pakistan in the 21st century. Its

management and workers must accept the competition and challenge of

the new millennium through innovative policies products and untiring

application.

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8.3 REFERENCES

URL:http://www.angelfire.com/ia/yasir710/history/history.html/

online

URL:

http://www.pakistaneconomist.com/issuel999/issue49/f&m.htm/onl

ine

URL: http://en.wikipedia.org/wiki/State_Bank_of_Pakistan/online

URL:

http://en.wikipedia.org/wiki/IndustrialJDevelopmentJBank/online

URL: http://en.wikipedia.org/wiki/AskariJBank/online

URL: http://en.wikipedia.org/wiki/MCB_Bank_Liniited/online

URL:http://en.wikipedia.org/wiki/Bank_Of_Punjab/online

URL: http://www.highbeam.com/doc/lGl-9265528.html/online

URL:

http://en.wikipedia.org/wiki/Govemor_of_State_Bank_of_Pakistan/o

nline

Askari Commercial Bank, Annual report 2008/online

http://askaribank.com. pk/index.php?id=156/online

Askari Commercial Bank Limited, organgram, departments,

website/online

www.askaribank.com.pk/online

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