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Contents
1. ACKNOWLEDGEMENT 2.SPECIAL THANKS 3.THE BANK OF PUNJAB: 3.1 VISION: 3.2 MISSION: 3.3 CORE VALUES: 3.4 HISTORY: 3.5 INTRODUCTION: 3.6 EXECUTIVE SUMMARY: ....................................................................................... 5 ....................................................................................... 6 ....................................................................................... 7 ....................................................................................... 7 ....................................................................................... 7 ....................................................................................... 7 .................................................................................................................... 8 ......................................................................................................... 8 ......................................................................................................... 8
3.7 AWARDS & ACHIEVEMENTS: ...................................................................................................... 9 4. BOP ISLAMIC BANKING BRANCH KARKHANO, PESHAWAR: ................................. 10
4.3. ACCOUNT OPENING PROCEDURES: ......................................................................................... 12 4.3.1. ACCOUNT OPENING FORM: ..................................................................................... 12 .......................... 12
4.3.2. COMPLETION & SUBMISSION OF ACCOUNT OPENING FORM: 4.3.3. 4.3.4. 4.3.5. 4.3.6. 4.3.7. 4.3.8. 4.4 4.5. 4.6. 4.7 4.8. 4.9 4.10 5. 5.1. 5.2. 5.3. 5.4. 5.5. SIGNATURE SPECIMEN CARD:
..................................................................................... 12
CUSTOMER VISIT REPORT / KNOW YOUR CUSTOMER /ENHANCED DUE DILIGENCE FORM: . 13 COMPUTERISED VERIFICATION: ..................................................................................... 13
ALLOTMENT OF ACCOUNT NUMBER:................................................................................ 14 ISSUANCE OF LETTER OF THANKS: ..................................................................................... 14 ISSUANCE OF CHEAQUE BOOK: .......................................................................................... 14 ISSUANCE OF ATM CARD / PIN CODE: ............................................................................... 14 RETURN OF PIN CODE:...................................................................................................... 14 DISPOSAL / DESTRUCTION OF ATM CARD: ........................................................................... 15 CHEAQUE BOOK CHARGES: ................................................................................................ 15 ATM CHARGES: CLEARINGS: OUTWARD CLEARING: INWARD CLEARING: ....................................................................................................... 15 ..................................................................................... 16 ..................................................................................... 16 ..................................................................................... 16 ......................... 16
NIFT ( NATIONAL INSTITUTIONAL FACILITATION TECHNOLOGIES ): INTER- CITY CLEARING: IBC ( INTER BANK CLEARING ):
..................................................................................... 16 ..................................................................................... 17 2
5.6. OBC ( OUTER BANK CLEARING ): 5.7. SAME-DAY CLEARING: 6. 6.1. 6.2. 6.3. 6.4. 6.5. 6.6. 6.7. 6.8. 6.9. DEFINITIONS: ACCOUNT: ACCOUNT OPENING FORM: BUSINESS : CUSTOMER : HIBA :
INVESTMENT RISK RESERVE (IRR): ..................................................................................... 18 LOSS / NET LOSS : MUDARABA MUDARIB ..................................................................................... 18 ..................................................................................... 18 ..................................................................................... 18 ..................................................................................... 18 ..................................................................................... 18 ............................................................ 19
6.12. PROFIT EQUALIZATION RESERVES ( PER ): 6.13. PROFIT / NET PROFIT: 6.14. RAB-UL-MAL: 6.15. SBP: 7. 7.1. 7.2. 7.3. 7.4. 7.5. 7.6. 7.7. 8. 8.1. 8.2. 8.3. 8.4. 9. 9.1 9.2. 9.3.
ISLAMIC PROFIT & LOSS ACCOUNT : MINOR ACCOUNT : PHOTO ACCOUNT: JOINT ACCOUNTS : DORMANT ACCOUNT : CLOSING OF ACCOUNT : PEST ANALYSIS: POLITICAL: ECONOMICAL: SOCIAL : TECHNOLOGICAL : SWOT ANALYSIS: STRENGTH : WEAKNESS : OPPORTUNITIES :
..................................................................................... 20 ..................................................................................... 20 ..................................................................................... 21 ..................................................................................... 21 ..................................................................................... 21 ..................................................................................... 22 ..................................................................................... 22 ..................................................................................... 22 ..................................................................................... 22 ..................................................................................... 23 ..................................................................................... 23 ..................................................................................... 23 ..................................................................................... 23 ..................................................................................... 24
1. ACKNOWLEDGEMENT
I would like thank my parents, teachers, fellows, managers, and all others who directly or indirectly assisted me in accomplishing this knowledgeable and learnable academic internship.
2. SPECIAL THANKS
With due respect, I would like to thank the following staff members whose kind supervision and humble mentoring made it possible to accomplish my internship purposefully:
3.2 MISSION:
To exceed the expectation of our stakeholders by leveraging our relationship with the Government of Punjab and delivering a complete range of professional solutions with a focus on program driven products and services in the agriculture and middle tier markets through a motivated team.
Our Customers:
Profitablility:
For the prosperity of our stakeholders that allows us to constantly invest, improve and succeed.
Excellence:
In everything we do.
Integrity:
Respect:
3.4 HISTORY:
The Bank of Punjab started functioning with the inauguration of its first branch of 7-Egerton Road, Lahore on November 15, 1989. The founder of the bank Mr. Nawaz Sharif performed the inauguration. The Bank of Punjab is working as a scheduled bank with its about 500 branches (round figure) in all major cities of the country. The bank provides all types of banking services such as Deposit in Local currency, Client Deposits in Foreign currency, Remittances and Advances to businesses, trade, industry and agriculture. The Bank of Punjab has entered into a new era of science to the nation under the experienced and professional hands of its management. The Bank of Punjab has played a vital role in the national economy through mobilization of untapped local resources, promoting savings and providing funds for investments. The Bank of Punjab has the privilege to discharge its responsibilities towards national prosperity and progress. Within the couple of years of its scheduling, the bank has not only carved out for itself prominent niche in the mainstream banking of the country but in certain areas it has the distinction of taking the lead. In short span of time the Bank has been able to evolve a distinct corporate culture through of its owned-based policies, which are realistic and are on highly professional footings.
3.5 INTRODUCTION:
The bank of Punjab (BOP) established in 1989 and got the status of scheduled bank in 1994. The bank of Punjab offer number of products in their customer. There are more than 500 branches of BOP in the whole country including conventional and Islamic banking branches. Functionally the bank of Punjab is divided in the division and the each division is headed by the general managers. The government of the Punjab holds the majority of the shares in BOP. It is doing business in commercial banking and the retail banking. Corporate banking treasury and investment and trade finance. The shares of BOP are traded in all three stock Exchanges of the Pakistan.
3.6
EXECUTIVE SUMMARY:
As the bank is mostly owned by the government of Punjab, therefore it is directly being governed by the government of Punjab. A President is being appointed by the provincial government. A Deputy President is there to assist the President. Apart from this there are certain group heads in the management hierarchy of the bank. Head Islamic Banking Division, Group Head Retail Banking, Group Head Human Resources, Group Head
Administrative Support, Group Head Special Projects & Legal, Group Head Commercial Banking, Group Head Retail Finance etc. are few prominent top management of the bank. Also there is a panel of Board of Directors for any legislation or other decisive and administrative prospects and perspectives of the organization.
The Central Board of Revenue presented "Excellence Award" to the Bank of Punjab in recognition of the contribution made by the bank towards Government exchequer.
In recognition of Bank's contribution in development and growth of agricultural sector, the Bank honoured with "Top Bank for Agriculture Loans" and "Best Bank Crop Insurance" under 3rd Kissan Time Awards year 2006.
Annual Report of the Bank for the year 2005 won 5th position for "The Best Corporate Report Award" for the financial sector, adjudicated jointly by the Institute of Chartered Accountants of Pakistan and the Institute of Cost and Management Accountants of Pakistan.
The Bank was awarded Best Bank Award under 15th Bolan Excellence Awards distributed in 2006.
ACHIEVEMENT AWARD
The Lahore Chamber of Commerce & Industry (LCCI) awarded the Bank "LCCI Achievement Award" 2006.
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FINANCING PLANS
N/A
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4.3.4.
CUSTOMER VISIT REPORT / KNOW YOUR CUSTOMER / ENHANCED DUE DILIGENCE FORM:
This is the most essential and delicate report that has to be maintained by either the manager or the designated officer about each and every customer who is opening an account with the bank. The officer will have to visit the business or office address of the customer that he / she have mentioned in the Account Opening Form. Officer will be completing a few formalities in order to verify that nothing in being wrongly stated by the client in the form and all that he / she have stated are being verifiable and true. This form has to be signed and completed by the banking officer, and then it has to be sent to the concerned Regional Head / Chief / Manager for final approval and remarks.
4.3.5.
COMPUTERISED VERIFICATION:
The customer's identity and all criminal / defaulter record is being verified through online verification system. An online database is being provided by NADRA to the bank to verify each customer's identification online. The concerned banking officer performs this job. Also the officer finds and ensures that the customer is not wanted by the Govt. in any case through NAB/OFAC verification system available with the concerned officer.
4.3.6.
After all the formalities are being completed, and receiving of the authorization from the Head / Chief / Manager, all the documents / forms / verifications are being organized and stapled in sequence with the Account Opening Form for final review and authorization from the Branch Manager & Manager Operations. In case of any shortage or incompletion of any record, the form is directed to the concerned officer for completion.
4.3.7.
After successful completion, verification, review and authorization, finally the customer qualifies to open an account in the bank. The concerned officer uploads the data into electronic form available to him / her in the Bank's Operating System. The officer uploads all the data mentioned in the Account Opening Form to the system.
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4.3.8.
After being uploaded and final supervision by the Operation Manager, the system authenticates and allots an account number to the customer against his account opening request. Now he / she can operate the account.
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customer holds an account. The banking officer thus informs and hand it over to the customer when he / she walks in.
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5. CLEARINGS:
If a customer receives a cross cheaque from an account holder of another bank / branch, and this customer of ours produce the cheaque to our branch with the purpose to deposit it in his / her account or vice versa. Then in such case this cheque is to be sent by post to the concerned bank branch for clearance purpose. Once the cheaque is sent and then received back, the amount is transferred to the depositors account. This service is carried out through an institution named as NIFT. It has certain charges mentioned in the schedule of charges. There are two types of clearings:
The concerned clearing banking officer has to enclose each and every such cheaque in its respective envelope.
6. DEFINITIONS:
6.1. ACCOUNT:
It means basic banking, savings or current (Pakistani Rupee or foreign currency) account(s) maintained by the customer with the Bank.
6.3. BUSINESS :
It means business, transactions and products approved by the Shariah Advisor, for the purpose of making investments from funds available in the pool(s).
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6.4. CUSTOMER :
It means any individual person, firm, company or any other association or organization, maintaining an account with the Bank, and includes (where appropriate) any person authorized by the customer to give instructions on customers behalf in relation to customers account.
6.5. HIBA :
It means a part of profit that is due to the Bank, which the Bank may relinquish, on the date of distribution, in favor of depositors.
6.8. MUDARABA
It means a form of partnership where one party provides the funds while the other provides expertise and management. Any profits accrued are shared between the two parties on a pre-agreed basis, while loss is borne by the provider of the capital.
6.9. MUDARIB
It means the party in a Mudaraba agreement that provides the expertise and management for managing the funds of the person who provides the funds.
6.10. MUSHARAKA
It means a relationship established under a contract by the mutual consent of the parties for sharing of profits and losses in the joint business. It is an agreement under which the Bank provides funds which are mixed with the funds of the business enterprise and others. All providers of capital are entitled to participate in management, but not necessarily required to do so. The profit is distributed among the partners in pre-agreed ratios, while the loss is borne by each partner strictly in proportion to respective capital contributions.
6.11. PIN
It means Personal Identification Number initially assigned by the Bank at the time of issuance of ATM Card and includes such other code as may be subsequently adopted by the customer for accessing the Banks ATM Services.
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6.14. RAB-UL-MAL:
It means the party in a Mudaraba agreement that provides the funds and accordingly shares the accrued profit with the Mudarib on a pre-agreed basis and solely bears the loss (if any) faced by the Mudaraba.
6.15. SBP:
It means the State Bank of Pakistan, established under the State Bank of Pakistan Act, 1956, and includes it successors in- interest.
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7.3.
MINOR ACCOUNT :
Deposit may be accepted from minors provided the account is opened and operated through a guardian. The Account thus opened is operated upon by the guardian even if the minor attains the age of majority. The necessary consent to this effect is obtained at the time of opening of the account.
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8. PEST ANALYSIS:
During my internship tenure, I found few external and internal factors that are or are going to effects the business operations of BOP Karkhano Branch. Those are dicussed and analyzed in this analysis as follows:
8.1. POLITICAL:
The Bank of Punjab is owned by the Govt. of Punjab as they holds most of its shares. This a surety factor for the investors / depositors available around the bank. But unfortunately, the branch is still not been given complete product line as it is still passing through its inauguration stages. Politically, The bank of Khyber holds most of the market here in Khyber Pakhtunkhwa because it is owned by the local government. To beat this edge, the BOP Karkhano branch has to be given most of the product line to compete in local market.
8.2. ECONOMICAL:
In banking perspective, I would analyze the economical aspect of the branch in terms of deposits and business made by it. Considering its deposits, number of accounts, market share and inauguration period, it is performing good. As compared to other branches of The Bank of Punjab in the region, it has got up with a boom. The branch is competing in market already saturated by a number of banks operating since a couple of years in the region. The customers has to go through tough screening instructions framed by the top management of the bank besides those incorporated by SBP. Therefore, the branch has potentially secured customers in all aspects.
8.3. SOCIAL :
Socially The Bank of Punjab has certain excellence. It has represented and assisted the Govt. of Punjab in all kinds of initiatives in the last decade. It has relieved farmers by issuing low interest agricultural loans. It has been a pioneer investor in Govt. of Punjab's youth initiatives. It has been sponsoring certain national, international and provincial events. But as far as its cross provincial projects are concerned, it does not have remarkable history though. Therefore, socially the branches of BOP do not have a competitive edge in KPK region. This factor do not dominates the market as other banks are having.
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8.4. TECHNOLOGICAL :
Technologically, the bank is dominating in certain sectors while in others it is lacking behind. One of its edges is that, the bank is completely centralized. All of the cheaque clearings, online transfers are performed through centralized networks. The software thus used in its internal is based upon DOS technology. It is quite outdated in the market. Banks are having customized user friendly software for their operations. Although it has been modified time to time but still it needs to be replaced because banking has gone modernized and due to the non-availability of certain options and automation it is affecting the operational efficiency of the staff within the branch.
9. SWOT ANALYSIS:
Following are the conclusions based upon experiences and learning during the internship. SWOT analysis is used to analyze the strengths, weaknesses, opportunities and threats to the bank in existing market. These are discussed as below:
9.1
STRENGTH :
Strength of the branch in Karkhano Market region is that it is an Islamic Banking Branch. The region mostly occupies business men belonging from traditional Islamic families. One may found them mostly interested in Shariah permitted dealings. Therefore, the BOP Karkhano holds an important factor to attract their customer. Those who are interested in Interest / profit / Riba free investments could be brought in and served accordingly.
9.2. WEAKNESS :
The branch is operating with a very few number of products. for most of the services the customers are either referred to any other branch of BOP in the region or they returns back taking away their investments. This is for sure baldy affecting the branch's market share. Its product line should be increased to attract all kinds of customers. Moreover the non-availability of ATM machine is also a negative element in the marketing of the branch. Still phone banking and e-banking service is not made available to the customers while the competitors are running even SMS alerts in the same scenario. Therefore, it is adding to the weakness of the branch specifically and ultimately to the Bank of Punjab.
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9.3. OPPORTUNITIES :
Lots of opportunities exist in the market for the Bank of Punjab in general and BOP karkhano in particular. Since the market is near to the industrial state of Peshawar, and the branch is located in an international trading market. Therefore traders and merchants from all over the country including Punjab trades from here. If the higher authorities provide a vast product line to the branch, they can introduce themselves to the potentially eligible customers who are trading from Punjab to KPK. They will have the surety that it is the bank of their province, they can easily transfer funds through Intercity, Online transfers and even through Inter-Bank clearings easily and swiftly from / to Punjab to their vendors / dealers / merchants. Providing the customers an e-banking, phone banking and SMS alert service will also be in favor of the bank. Also an ATM machine can bring on the customers of such banks who are not having an ATM machine at their branch. This can help increase walk-in customers for opening an account.
9.4. THREATS :
Dealing with outdated software, limited products, rare services, certain taxes and charges that other banks do not collect nowadays in order to facilitate their customers are real threats for the Bank of Punjab in today modernized banking culture. Today's customer is in search of better service, fast response at cheap expenses from his / her own pocket. Therefore, it has to be planned to subsidize the customer to the most possible way. Moreover, the competitors are in the market with such a product line that has supplementary for each and every kind of product. Once a customer gets in, he / she can never step out without satisfaction from the product line. Therefore, BOP karkhano should be given an identical product line to penetrate with in the market.
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10.
COMPETITORS:
The Bank of Punjab, Islamic Banking Branch Karkhano has got to deal with a lot of competitors in its market. It has got certain emerging banks of the country who are making far more market share not only in this region but also all over Pakistan due to their enhanced product line, excellent customer oriented policies and market forecasting abilities. The eminent competitors are : Bank Alfalah Limited. UBL Ameen (Islamic banking Branch). Bank Al-Habib. MCB (Islamic Banking Branch). JS Bank. The Bank of Khyber.
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REFERENCES / BIBLIOGRAPHY:
Mr. Imran Mobeen Shinwari. - Regarding Islamic Finaning / Banking. Branch Manager, BOP Karkhano Peshawar. Miss. Asma Usman. - Regarding Branch Operations / Terms / Procedures. Branch Operations Manager, BOP Karkhano Peshawar. Mr. Wajahat Hussain Kakar. - Regarding Operations / Clearings / Reportings. Officer Grade-II, BOP Karkhano Peshawar. Mr. Sahibzada Jamshid Noor. - Regarding Operations / Vouchers / Administration / Filings / Recordings / IT affairs. Officer Grade-II, BOP Karkhano Peshawar. Mr. Arshad Khan. - Regarding IT / Account Pre-requisites / Customer Service. Business Development Officer, BOP Karkhano Peshawar. Mr. Imran Khan. -Regarding Customer Services / Forms completion. Business Development Officer, BOP Karkhano Peshawar. Mr. Humayun Shehzad. - Regarding Cash matters. Cash Incharge / Officer Grade-III, BOP Karkhano Peshawar. Mr. Sabir Ali. - Regarding Cash matters. Cash Officer, BOP Karkhano Peshawar.
THE END
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