CHAPTER # 1

INTRODUCTION
INTRODUCTION OF BANK OF KHYBER
The Bank of Khyber was established through an Act of KPK
Assembly called, The BoK Act, 1991, passed in June 1991 the bank was formally launched
on November 01, 1991.
The Bank of Khyber initially started as a provincial Bank and later declared as Scheduled
Commercial Bank by SBP in September, 1994.The initial paid up capital of the Bank was Rs.
153 million, which has now been raised to Rs. 1 billion.
SCHEDULED BANK STATUS
Since 1994 the Bank of Khyber has come under the regulatory framework of SBP, and
operates as Scheduled Bank at the National level.
While compliance with requirements and other regulatory restrictions had a negative impact
on Banks profitability in 1995,
However the ensuring growth in business expanded the profits of the bank reaching Rs 85
million in the year 1997.
BRANCH NETWORK
At the end of the year 2014, the Bank was operating with 116 branches. The Bank
received approval from the State Bank of Pakistan for the opening of 14 new branches in the
year 2015, now there are 130 branches all over the country with 65 Conventional and 65
Islamic Banking branches. Through this network, the Bank is able to offer wide range of
products and services to its valuable customers.
PURPOSE OF STUDY
The purpose of the study is to know the practical implementation of the theoretical
knowledge, in an organization. The study on the bank of Khyber was carried out to find the
answers to the shortcomings that were observed during the internship. Based on the analysis
and findings some recommendations are presented to the management for improvement of its

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operations. Apart from this, the internship report is an important and compulsory requirement
for the Bachelor of Business Administration Degree.
SCOPE OF WORK
The internship was done at Bank of Khyber, Batkhela branch. The main emphases of
this study is on the working operations of accounts, cash, clearing, credit, IT and remittance
sections and the financial analysis of the Bank of Khyber, Batkhela branch, KPK

METHODOLOGY OF THE STUDY

The data information for the internship report was gathered through different sources
i.e. primary as well as secondary; a detail of these is given below:
PRIMARY DATA
The interviews, discussions with management and staff members, briefings given by
mangers, questionnaire filled by the staff and my personal observation during the internship
were the sources of primary data.
SECONDARY DATA
The broachers, manuals, annual reports of the Bank of Khyber other booklets of The
Bank of Khyber about the rules and procedures, journals, information on the website of The
Bank of Khyber were the sources of secondary data.

BANKING
A bank is an Institution, which deals in money. Broadly speaking, Banker draws
surplus money from the people who are not using it at the time and lend to those who are in a
position to use it for productive purposes.
BANKING SECTOR IN PAKISTAN
The money market structure in Pakistan comprises the following: 1) SBP 2)
Commercial Banks 3) Exchange banks 4) Cooperative Banks 5) Cooperative Credit Banks 6)
Saving Banks 7) Specialized Credit Institution.
BANKING SECTOR IN KPK
There are about 22 Pakistani Scheduled banks operating in the KPK having 1147
branches. In addition 3 foreign scheduled banks with a total of 3 branches are also operating
in the province. Historically banks in the KPK have been able to mobilize substantial
amounts of the total deposits of the country. However their share of investment in the
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province has not been within the province has also increased creating a demand for banking
services. A large expatriate community from KPK residing overseas especially in the Middle
East are also offering opportunities to banks operating in the province.

MISSION STATEMENT
The Bank of Khyber being an organization has mission. The mission, documented in
the mission statement is as follows:
To increase shareholders value and provide excellent service and innovative products
to customers through effective corporate governance, friendly work environment, and
contributing towards an equitable socioeconomic growth.

MAIN OBJECTIVES OF THE BANK

The BoK was established to:

Meet demand of the business community to have a Bank with its Head Office in the
Province.

Have accessibility of local businessmen to senior management of the Bank for prompt
credit decision making thereby accelerating investment in KPK.

Have maximum utilization of funds raised in the Province for economic development
of KPK.

To mobiles private savings and public funds for diverting the same into productive
channels and ensure their availability.

To promote industrial agricultural and sonic economic processes through the active
participation of private and public sector in the province.

Help under developed areas and create employment opportunities, especially in the
rural areas of the province. Further, to guide and assist the people of KPK serving
overseas to effectively and profitably invest their foreign savings in the province as
well as in other parts of Pakistan.

Participate and seek of the province in the capital market of Pakistan by way of subscription
through locally pooled resources in the leading stock exchanges of the country and
eventually paving the way for establishing a stock market in the province.

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 One of the purposes behind the establishment of BoK was to fulfill the demand of the
business community of KPK, and to have a commercial bank its head office in the province
to serve more effectively the people of the province.

PRODUCTS OF BOK
Current Deposit Account (Rupees)
The BOK current deposit account allows the facility of unlimited
Withdrawals up to the extent of the Balance in account. There will be no tax deducted on the
funds that someone chooses to keep in these accounts.
Saving deposit account (rupees)
The BOK saving deposit account allows the facility of multiple withdrawals up to the
Credit Balance, while accruing profit on deposits.
Term deposit account (rupees)
The BOK Term Deposit Account offers the dual benefit of attractive returns with
highly liquidity. There is option to take profit monthly, quarterly, bi-annually, annually or at
maturity. Profit is accrued on a daily Balance basis. There is no penalty for premature
encasement. However, in case of an early encasement the rate of the previous tender will be
applied.
Call deposit receipts (CDRS)
This is a receipt by the bank, at the instructions of the depositor, confirming that the
amount of the SDR is held by the bank to be paid whenever called upon to do so by the
beneficiary named in the CDR.
ATM services
In order to keep pace with advancements in the field of technology, BOK has joined
the electronic platform of M-Net switch. This will facilitate consumers by providing them
access to their funds through the existing ATM network of the country. In BOK Batkhela
branch ATM was installed in March 2014 to facilitate their customers.
Western Union
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Through western union people send their money from one country to another country.
BOK Batkhela branch also has the facility of western union.
Following requirements are necessary for western union.
The receiver of the money must have the photocopy of his/her original computerized
National I.D card.
The MTCN (Money transfer control number).
Express money Placid Express and Malik Exchange
BOK has also provided the facility of Express money, Placid Express and Malik
Exchange through which money is transferred from one country to another. All other
requirements are same as that of western union. There are no charges on western union,
Malik Exchange and express money. The bank provided this facility free of cost because
money transferred from other countries increases foreign reserves of the country it offers the
dual benefit of attractive returns with highly liquidity. There is option to take profit monthly,
quarterly, bi-annually, annually or at maturity. Profit is accrued on a daily Balance basis.
There is no penalty for premature encasement. However, in case of an early encasement the
rate of the previous tender will be applied. The option of partial liquidity is allowed i.e.
withdrawal to a certain percentage from the fixed deposit without disturbing the remaining
deposit.

COMPETITORS OF BOK

The Bank of Punjab

Allied Bank Limited

Bank Al Falah

Askari Bank

Faisal Bank

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CHAPTER # 2

ADMINISTRATIVE AND FUNCTIONAL

SETUP OF BOK
ORGANIZATIONAL STRUCTURE OF BANK OF KHYBER
The Bank of Khyber is one of the modern organizations, it being managed by a
competent staff. It is a centralized organization and the authority flows from up to bottom.
All the available information about the organizations management and structured are given
in this chapter. Based on BoK Act, the general superintendence and direction of the affairs
and business of the bank has been entrusted to the Board of Directors (BOD). The Board of
five directors comprising four directors nominated by the government of KPK.
BOKS BOARD OF DIRECTORS
According to the Bok Act, the Board of directors comprises of nine as follows:

Four directors nominated by the govt.

One director nominated by the Foreign Equity Holder

Three directors elected by the shareholders

The managing Director shall be the ninth director

MANAGEMENT
The day to day operations of the bank are run by a capable team led by Mr. Basher
Ahmad who is a competent, well qualified and highly respected banker. He has served with
the World Bank and as Federal Secretary to the government of Pakistan. He has also served
as the managing Director of PICIC, IDBP, NIT and chairman, ADBP during his career. He
holds a degree in economics from the London school of Economics. Over the past few years,
Mr. Basher Ahmad has gathered a team of professionals and well qualified senior executives
of the bank.

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EMPLOYEES
The bank currently employs 351 regular officers in various cadres of the bank. They
include 2 Ph.D., 181 post graduates including 75 MBAs/M.com, 93 M.A/M.Sc, 13 LLB from
foreign and local universities and 169 graduates. Regular Clerical/ Non-Clerical Cadre do not
exist in the Bank. The bank provides them with on the job training, as well as exposure to
advance courses and seminars conducted by the institute of Banker in Pakistan and other
professional institutes.

HEAD OFFICE
Bank of Khyber has its Head Office. It is situated in cantt. This office is equipped
with latest scientific tool. It has internet software. It provides all the important information.
Head office has two divisions; as given below:
The banking division
Administrative division
These are further classified for the purpose of administrative convenience. There are also
other 2 independent departments.
Long term projects
Audit department
Long term projects handles the invest proposals of huge industrial projects whereas audit
department is meant to have an internal control:
DIFFERENT DEPARTMENT IN HEAD OFFICE
1. Branch operation department
2. Micro business and Rural development
3. Investment
4. Personnel and establishment
5. Accounts and treasury
6. Monitoring and recovery
7. Long term projects
8. Computer
9. Foreign exchange
10. Public relation
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11. Credit
12. RRMC/RC
13. International banking

DEPARTMENTS
1. BRANCH OPERATION
The branch operation department has direct control on operation of branches. It handles
all these issue that are directly related to the operation of branches e.g.

Handles and legal issues

Budget projection

Test key

2. MICRO-BUSINESS AND RURAL DEVOLOPEMENT

This department deal specially with the due of cotton industry and small businesses,
the aim of establishment this department was to fulfill the finance need of small businesses in
KPK. This department also provides loans to women development and rural area.
3. INVESTMENT
This is a relatively new establishment department. The purpose is to pinpoint the
invest opportunity and to develop investment programs. This department also forecast threat
associated with this opportunity and gives expertise.
4. PERSONNEL AND ESTABLISHMENT DIVISION
i) Personnel.
ii) Establishment
Human are the backbone of organization. Its success is largely dependent on its personnel.
The personnel department handle all the issue related to its employee it handle from recruit to
promotion from ACR preparation to punishment and incentives etc.
In order to develop its talented employee personnel section in collaboration with M/S
department which was establishment recently aims at providing, preserving and enhancing

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new as well as existing employee competence in their jobs through improving their
knowledge, skill, abilities and other characteristics by providing them training opportunity.
ACCOUNT AND TREASURY
This department keeps entire record relating to accounts. This department as its name
signifies is responsible for handling the account of cash of bank of Khyber.
This department is further divided into two departments
ACCOUNT DEPARTMENT
Account department is responsible for repairing quarterly income statement, cash
flow statement and Balance statement.
TREASURY DEPARTMENT
Treasury department is responsible for managing funds and to avoiding chance of
misuse of funds.
MONITORING AND RECOVERY
In strict sense this department is legal hand of bank of Khyber. This department
negotiates all the debts and if its efforts go in vain then they file litigation. This department
provides full assistance to branches in enforcement of actual recoveries of debt through legal
process. They trace borrowers and their assets and servicing of summons.
LONG TERM PROJECTS
This department is concerned with primarily with long term projects. This duty is to
identify those long term project that will add significantly to development and progress of
KPK in particular and Pakistan in general.
COMPUTER DEPARTMENT
No modern organization can be visional without computer. This department is
responsible for computerization of various branches of Bank of Khyber. This department has
developed network software internet for the Head office etc.
FOREIGN EXCHANGE
This department is responsible for
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Maintaining FCA

Dealing in telegraph drafts in foreign currencies

Facilities of imports and exports to client

PUBLIC RELATION
This department suggests how to improves relation with the public, how to attract
customers and how to enhance people to invest in bank.
CREDIT DEPARTMENT
Credit division is for large loan sanction. This department handles the request and
proposal of borrowers. This department is responsible for handling the lending activities of
the bank. It provides accounts the terms and conditions to clients. It is responsibility of this
department to accept or reject a proposal.
RRMC/RC

Recovery of stuck off loans.

Negotiate with customer.

Banking court.

Mortgages.

HUMAN RESOURCE DIVISION

Human resource division (HRD) plays a vital role in carving the present and future
image of an organization by managing employees in the most beneficial and effective
manner, the functional arena of HRD consists of recruitment, training, performance
appraisals, planning and career development and above all grooming of staff to adhere to
office ethics and social norms. At BOK, they believe that manpower is the most important
and precious asset. The HRD tries to create an environment of mutual trust and dignity and
trying hard to pursuit the expression: We rather than I so as to ensure best positive results.
It is playing a proactive role in capacity building, experience sharing, strengthening analytical
and policymaking, skill up-graduation to help the staff in their endeavors to make BoK
competitive, dynamic and one of the best banks in the country.
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HRD provides on the job as well as off-site training to the staff in diverse areas of banking
and management. The training relies on both external courses at institutes of repute in the
country and internally arranged courses. The management is very cautious about the training
needs of the staff and every year a handsome budget is allocated for this purpose, our policy
is to provide every employee at least one opportunity to attend training program in each
calendar year.
In addition to above, BoK acknowledges professional acumen, experience and expertise of its
staff through regular financial benefits in the shape of competitive salaries, cash awards,
promotions, academic, sponsorships and other incentives so as to boost their morale for
greater input towards betterment of the bank.5
HRD department includes:
1. Personnel and Establishment department
2. Public Relation department
3. Stationary department
ESTABLISHMENT SECTION
Establishment is another major section in P& E department; this section is responsible for the
following activities;

Establishment of new Branches.

Maintenance of existing Branches.

PROCEDURE OF ESTABLISHING NEW BRANCH

1. The management committee decides whether a new branch should be established or not
keeping in view the available development funds.
2.Establishment section assigned the responsibility to pre pare the survey report for the
establishment of new branch such as bank name, number of branches capital structure, total
deposits, liquidity position, etc. the part two contain details about new branch, information
regarding the following items.

Name of the proposed branch.

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Location of the proposed branch or other arrangements.

Means of communications available at the proposed location.

Confirmation of the branch location that whether it falls within the municipal town
area.

Names, location and distance of nearest other banks branches.

Population of the area.

The volume and value of agricultural mineral, industrial production, import and
export of area of branch operations.

Detail of exiting schemes for agriculture mineral or industrial development and their
probable effect on the volume and volume and value of present production, import
and exports.

Estimate income which the branch exports to earn within three years of its operations,
details of sources such as interest return on advances, communion, funds, placed with
head office.

Estimating the recurring expenditure for the proposed branch profit/loss anticipated.

The survey officer submits with the survey reports with SBP. SBP makes the final
decision of granting license for.

Once license is granted by SBP, establishment of new branch, which involves some of
the following:

Legal contract with the owner of proposed branch building, if any prior arrangements
have been for the location of new branch.

Purchasing, leasing of necessary equipments (such as computers, fax machines, safes,

lockers) through bidding for new branch.

Insurance of branch equipment with the approved insurance Companies.

MAINTENANCE OF EXISTING BRANCHES

The Maintenance involves all sort of expenditures which are incurred either for the
repair of capital assets or for conditions to available capital assets, within the exiting branches
and banks residences the establishment section premium on issues capital to the concerned
branch, establishment section also handles the vehicles payment of token face and
replacement of any part of the vehicles, office equipment.

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FUNCTIONS OF ESTABLISHMENT DEPARTMENT

1. Acquisition, Disposal/ replacement of fixed Assets, including vehicles.
2. Maintenance, up-keep of equipment/ renovation of fixed Assets.
3. Routine visits to Branches, HO Department regarding supervision of maintenance and
branch requirements.
4. Negotiation, liaison with suppliers, contractors, Architects and Landlords (lesser).
5. Arrangement of premises for branches, HO and execution of lease agreements.
6. Inviting of tenders/ quotations for such job/works/goods.
7. Preparation of approval/ sanction notes.
8. Obtaining approval from P& W committees for such works/goods.
9. Processing/ payments of bills, pertaining to such works/ jobs/ procurements.
10. Preparation of capital budget of the bank.
12. Supervision of Administrative matters and general
Condition/ cleanliness of branches.
13. Liaison with branches regarding up-keep, maintenance,
Acquisition of such assets & general condition of
Branches.
14. Security arrangement i.e. provision of security Guards,
Burglar Alarm System etc. to Head office and branches.
FUNCTIONS OF PERSONNEL DEPARTEMENT
1. They are engage in Personnel policy and Recruitment Planning.
2. They are concern with promotion and transfers of the employees.
3. Give loans, Medical leaves and Disciplinary actions to the employees.
4. They give training to the employees.
5. They are engage in Human resource Development, Job Rotation, Training, Career
Development, Employee Relation, Health Fitness Program
6. They arrange board meeting in the organization.
7. They also deal internees.
8. They forecast future needs and human resource planning.
9. They give salaries to the employees.
10. They are engage in screening and selection of employees.
11. It also gives Post Retirement Benefits to the employees of the bank.
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FUNCTIONS OF PUBLIC DEPARTMENT

1. Design & launch publicity of the bank of Khyber.
2. Arrange high level meetings with Governor/ chief minister/ provincial & federal
Ministers arrange high-level Government officials.
3. Accompany the managing director at the meetings as principal staff officer.
4. Generate English bulletin on political/ cultural/ social economic news.
5. Conduct protocol duties with the visiting dignitaries, delegations & other luminaries.
6. Prepare press release in English & Urdu.
7. Keep close liaison with all Pakistani political/social leaders.
8. Keep

liaison

with

all

the

international

organizations

like

UNHCR/ICRC/UNOCHA/Afghan commissioner ate, KPK, Peshawar too coordinate

in relation to issue of BOK.
9. Keep close contract with local industrialists, businessmen & Sarhad
10. Chamber of commerce & industry for promoting mutual trade relations.

FUNCTIONS OF STATIONERY DEPARTMENT

1. Administration and overall supervision of the department as In charge of the
Department.
2. Putting notes for seeking prior administrative approvals for procurement of printed
and security stationery from purchase committee and after approval; order are placed
to printer. After receipt of respective consignments; payment notes are submitted to
purchase committee.
3. Correspondence with HO/Branches/Departments.
4. Being the Secretary of Stationary Committee, meeting of the committee are arranged
for making decision with regard to introduction of new items; amendments of existing
forms and pads with consultation and consent of members of committee.
5. Rectification of audit objections and removal of any complaint of the
Branch/Department in respect of supply of items at the stationery required.
6. Any other matter which management wants to discuss in respect of supply of printed
and security stationery items.

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CHAPTER 3

BANK OF KHYBER (BATKHELA BRANCH)

Introduction of the Branch
BOK Batkhela branch is one of the important branches of BOK. Because it is one of the
commercial places, it performs all the functions of the commercial bank, from deposits to
advances, remittances etc. The Batkhela branch of BOK is widely acclaimed as the busiest
branch in the region. The site of the branch is very suitable. New Building of the branch is
big enough to accommodate the staff and clients comfortably. The staff of the bank is so
active to deal the clients.
Departments of BOK Batkhela
1. Accounts Department
2. Cash Department
3. Credit Department
4. IT Department
5. Clearing Department
6. Remittances

Departments in which I worked during my internship

The departments in which I worked are,
Accounts Department
This department coordinates all the banking activities there by keeping track of each
activity in a sequential manner and provides up-to-date data. The accounts department is also
responsible for proper accounting of assets and liabilities of the branch. This department is
the backbone of the entire banking system. All the banking activities are placed through this
channel. The main functions of this department are:

Maintenance of books of accounts.

Preparation and disbursement of salaries of banks staff

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Maintenance of superannuating funds and investment of the staff

Dealing with the disposal of commercial and external audit Reports.

Preparation of budget and other financial statements

Supervisors name: M. Asif Nisar
Job title: Account Officer
Cash Department:
Cash department owes its importance to the fact that it is a major point of contract
between the bank and the customer, the banks most valued relationships. This department is
the showcase of the bank and conveys the first impressions about the banks commitment to
professionalism in its system and procedures and to courteous and efficient customer service.
This department performs the function of receipts and payments. Efficient cash management
is needed to execute payments, collect receivables and maintain liquidity.
All the activities of the cash department are divided into two i.e. Cash Collection and Cash
Payment.
Supervisors name: Fazal Hadi and Ubaid khan
Job title: CD Incharge
Remittances Department
Funds transfer facility or remittances of funds are one of the functions of the banks all
over the world. Remittances through banking channels save
Time, costs less and eliminate the risks involved in physical; transportation of money from
one place to another.
Types of Remittances
Remittances can broadly be classified as outward and inward remittances.
Outward Remittance
When a bank / branch instruct another bank/branch to affect a remittance or payment, it is
said to be affecting an outward remittance.
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Inward Remittance
When a bank/branch is itself affecting a payment/ disbursement at the instructions of
another bank/branch, it is said to be handling an inward remittance.
Modes of Remittances
Different modes and means of remittance are discussed below. BOK transfers money in
the following ways:
1.

Demand draft (DD)

2.

Telegraphic transfer (TT)

3.

Mail transfer (MT)

4.

Pay order (P/O)

Supervisors name: M. Salman and M. Anees Gull
Job Title: Remittance Officer
Credit Department
The bank is profit- seeking organization. It attracts surplus balance from the customer at
low rate of interest and makes advances at a higher rate of interest to the individual and
business firms. Credit and extensions are
The most important activity of all the financial institutions, because it is the main source of
the earning. Credit department is one of the most sensitive and important department of BOK.
About 75% of the profit is usually earned through this department. The job of this department
is to make proposals about the loans; the credit management division of HO directly controls
all the advances.
Supervisors name: Suhail khan
Job Title: Credit Officer
IT Department
The BOK has appointed some qualified software and hardware engineers in IT
department. The senior most is deputed as In-charge of the IT department. Software
engineers/programmers are not only responsible for application development in BOK and to
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fulfill requirements of the bank, but also act like trouble shooters, whereas, installation of the
hardware in the branch set up is the responsibility of hardware engineers. In each Branch,
they have assigned a systems administrator to look after jobs related to the computing system.
Supervisors name: Ali Gohar
Job Title: System Administration

TASK WHICH I PERFORM DURING MY INTERNSHIP

Tasks that I have performed during internship are:
Account-opening
Accounts opening department is one of the departments that come under the retail/general
banking facilities provided by Bank of Khyber. Some of the major deposit Accounts opened
by Bank of Khyber are as follows:
Current Account
Current Accounts are non-interest bearing accounts that have a minimum account opening
Requirement of Rs 10,000. No zakat is deducted on the accounts balance. Furthermore all
current account holders receive a Hilal debit card and there are no restriction on the number
of withdraws or deposits made to and from the account.
Profit& Loss Saving Account
Profit& Loss saving accounts can be opened with a minimum balance requirement of Rs
5,000 and profit is credited on a half yearly basis. There are no restrictions on the number of
deposits and withdrawal made to and from the account and all account holders receive.
Basic Requirements for Account Opening
The basic requirements to open an account for individuals/self-employed are as follows:

CNIC

Source of income (salary slip etc)

Company letterhead or authorization (as required)

The basic requirement to open an account for a partnership

Partnership Deed
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Partners CNIC

Company Letterhead
The basic requirement to open an account for companies:

Memorandum of Association

Article of Association

Directors CNIC

Company Letterhead
Cheque book issuance
It is issued to those customers whose accounts are operated by the
Concern bank. I have also learned to make Cheque book request by
Filling its different contents like serial number, date, account number, account type and
account title. I also issued cheque books to customers as well. Then I used to record its entry
in the register and signatures were taken from customer as a proof. Record had been entered
on separate pages for current and savings account.
Credit Department
In my internship, I have also worked in credit department where I seek what kind of loans
BOK provides to its customers

1.

Types of customers to whom it provides loans

2.

Criteria for providing credit

3.

Interest rate

4.

Procedure for verifications of customers

5.

Duration of loans granted

6.

Procedure in case the customer defaults

Clearing
I got the experience to know about the cheque clearance process. My clearing department
officer told me the procedure of both the inward and outward clearing, software used and role
of NIFT. I used to fill these cheques by filling its contents. In this regard, I have also learned
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about techniques to check the scrutiny of check by checking name, date and sign and also
came to know that three stamps are needed for it; clearing stamp, cross stamp and
endorsement stamp.
I was advised by my sir Mr. Sami Ullah to be remained alert about the fake cheques,
giving some instructions for the careful examination of cheques like signature verification
from specimen card. For the time of receiving cheques I had to consider the following
instruction,
1.

Date of the cheque mean post/ out dated cheque must not be received.

2.

Amount in figure or wording must be same.

3.

Signature must be authorized.

4.

If cheque amount in above of 100,000 than supervision must be necessary.

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CHAPTER # 4

ANALYSIS
ADMINISTRATIVE ANALYSIS
1. SPACES SHORTAGE
It is observed that branches suffer from space shortage. The seating arrangement is
not sufficient as compared to the number of employees and customer.
2. CENTRALIZATION
BoK has a centralized structure. There is no delegation of authority to the lower
management/staff. In order to improve the performance of the staff and to build their
confidence, some authority must be delegated to the lower management.
3. LACK OF SPECIALIZD TRAINING
In BoK training is provided on basis of generalization rather than specialization. After
completion of training he/she is inducted into a specific field. Due to lack of knowledge he or
she faces difficulty to perform the assigned job.
4. NEGLIGENCE OF RULES AND REGULATIONS
It has been noted that the Banks officers usually neglect the rules and

regulations

either intentionally or unintentionally, because these have not properly communicated to

them. Their prompt communication must be ensured and the employees must be informed
about the penalties in cases of negligence.
5. POOR JOB ROTATION
Branch officers are not properly rotated. It is noted that an experience banker from
Deposit section doesnt know about the work of remittance department. So they must be
rotated in all the departments of the banking order to get familiar with the working of
different department in order to have a knowhow of the whole system.
6. IMPROPER DISTRIBUTION OF DUTIES
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In BoK there is improper distribution of duties and responsibilities. It is being

observed that sometimes an officer of the same grades may less or more responsibility than
another officer of this grade.
7. WORKING SETUP
It is observed that there are some deficiencies in the branch setup, which creates extra
disturbance, and excessive movement, which in turn affect the efficiency of employees and
thus that of the whole organization also.

POLITICAL ANALYSIS
INTERNAL POLITICAL ENVIRONMENT
1. In personnel and establishment is no systematic reward that result is lower employee
motivation. Due to which the experience project officers frequently leave personnel and
establishment. This result in constant shortage of project officer.
2. There is a very weak coordination among employee of personnel and establishment. It
serve as factor toward is efficiency of which on it.
3. There is no political pressure for strong coordination between different institutions so as to
lower the cost of employees.
4. There is lot of political interference in the recruitment system of the bank that results in
inefficient management which in the long run results eventually in bad portfolio.
5. Having 51% share of Bank of Khyber provincial government always interfere in regular
operation of bank which has strong impact on efficiency of bank.

SWOT ANALYSIS
SWOT is an acronym for Strength, Weaknesses, Opportunities and Threats. SWOT
analysis is a careful evaluation of an organizations internal strengths, weaknesses as well as
its environmental/external opportunities and threats.
Strategies for SWOT Analysis

Exploiting opportunities and strengths.

Neutralizing its threats

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Avoiding its weaknesses.

SWOT analysis is based on the assumption that if management is careful then it

ensures organizational success. SWOT analysis is an important tool in analyzing the overall
situation in which organization is conducting its business affairs; each issue remains relevant
and useful of corporate strategy formulation.

SWOT ANALYSIS OF BANK OF KHYBER

STRENGTH
1. First bank to start Islamic banking in Pakistan.
2. Provincial government backing and confidence of people due to government bank.
3. It has modern technology and resources.
4. Staff has combination of young and rich in experience and working skill.
5. Officer attractive schemes and, more save for customer from time to time.
6. The Bank of Khyber has market confidence in providing products and services to the
customers over the year.
7. Bank of Khyber has the ability to cope with pressure of competition.
8. Bank has the good with of the people and it is also an asset to it.
9. Banks management has the motivation to make it best bank of the country.
WEAKNESS
1. Employees are lacking motivation. Bank is not limits and thus reducing the efficiency.
2. Communication gap between different levels of management.
3. The lower level management lacks clear direction and is not having the managerial
depth.
4. Lack of experienced commercial bankers in the top management positions
5. Lack of modern banking approaches like ATM and commerce on line banking.
6. Marketing skills of the bank are good but they have little presence at different media.
7. Low salary structure as compare to competitors.
8. Not in the position to compete with other banks.
9. Lack of highly trained resource staff. Increasing trend of bad loans.
10. Lack of modern technology.
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OPPORTUNITIES
1. Opportunity to open branches in northern areas specially

because there is 100%

current deposit.
2. All branches are computerized therefore no difficulty
In thinking it into on line banking.
3. Bank should take interest in the new market segments like IT business, software
business etc.
4. A new serves to its product line.
5. Increasing credit facilities to lower income groups, thus reducing the risk of loss and
also improving the image of the bank.
6. To open a branch in Afghanistan.
THREATS
1. Political, economical situation of the country. Reduction in the business activities in
the country.
2. Deteriorating confidence of people in bank uncertainties of the investors.
3. Modern technology used by other commercial banks.
4. Starting Islamic banking is threats for BoK because if it is flop it will be a big loss for
BoK.
5. Increasing number of private/foreign banks in the country.
6. Reducing the rates of savings in different segments of people.
7. Global technological advancement.
8. Bank Alfalah and other commercial banks is the biggest threat for BoK.
9. Qualified staff working in other banks.
For SWOT analysis we can conclude that the management of the bank should adopt
systematic planning for the bank growth, talking with them all management levels of the
banks, discover new segments of the customers, offering schemes for its customers.
Similarly Bank of Khyber has to focus on potential customers and give proper attention to
every customer and their need then it will become one of the leading and comprehensive
banks.

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Emphasis on present customers by giving them personal Services and targeting the
private potential customers instead of Government deposits at high interest rates. Creeping
trend of non-performing loans.

CHAPTER # 5

RECOMMENDATION
The following findings and recommendations are based on personal observations and
analysis. The given recommendations will help to cope the problems being faced by the bank
and will enhance the efficiency and performance of the bank of Khyber.
1. SPACE SHORTAGE
During my internship in Batkhela Branch I observed that there is shortage of space at
branch. There is no proper and easy seating arrangement for the customers. To overcome this

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problem, the bank either may hire the adjacent building or simply can shift to some other
place.
2. BETTER TRAINING PROGRAMS
It has been noticed that the training program of BoK is not adequate. Special
marketing training should be given to employees for motivating customers. The training
program of bank should include scientific techniques to improve decision making and
interpersonal as well as individual needs of an employee.
3. DECENTRALIZATION
Some authority and responsibility should be delegated to the lower grade staff as well
so that they should also consider themselves important and responsible. This will also be
motivating factor for them and results in greater efficiency.
4. PROPER CHECKING
There is no proper checking system on the entrance of bank. For safety purposes,
there should more security measures, besides special checking instruments at the main
entrance.
5. BETTER COMMUNICAION
The management of BoK should concentrate on improving upward communication so
as to have better feedback system involvement in the bank operation.
6. MERITORIOUS RECRUITMENT
Appointment in the bank should be strictly on merit basis with no other favor given to
any candidates.
In the BoK connection play an important role in recruitment decisions. Recruitment
should be based on relevant qualification and experience particularly in the field of business
administration, financial management, and computerization and marketing expert through
competition, which will ultimately attract better competent employees in the bank.
7. MARKETING VISITS
A very useful mode of conduct is personal market visit. Such visits should be properly
planned with regularly.
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8. TRAINING ACADEMY
The BoK does not have its own training academy. The training to newly recruited
employees is given in the training academies of other banks. Similar is the case for existing
employees. To fulfill the requirements of training of the new and existing employees to
receive training of the peculiar and specify working functioning of the BoK.
9. SHORTAGE OF EMPLOYEES
Shortage of employees increases the workload on existing employees and ultimately
reduces the output and motivation level of employees. To overcome this problem job
description should be revised and grouped together in order to create new jobs.
Recruitment should be done in order to fill up these new vacancies. In this way the
workload on employees will be reduced, operations will be stream lined and employees will
feel comfortable in performing their duties more effectively.
10. FRIENDLIER ENVIRONMENT
Friendlier environment should be created because it will help to gain the interest of
employees in work. Noise in the office should be reduced because it has unfavorable impact
on the working environment. Separate place or section should be created for each separate
task and more space should be provided. It would also be of greater help in establishment of
friendly environment.
11. ENHANCED CUSTOMER SERVICES
Constant improvement in customer services are needed in todays competitive
environment. Personalized banking should be introduced to attract more customers. Equal
respect should be given to all customers.
12. INTERNATIONAL BANKING
BoK should expand its branches, not only in Pakistan but also outside the country
now.
13. LATEST COMPUTER EQUIPMENTS
Latest software should be introduced in the bank so that the data processing speed of
the computer can be enhanced.
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14. CUSTOMER CARE COUNTER

Customers satisfaction is the key to success. They need proper attention. The Head
office is understaffed and employees are over loaded, it creates more problems for them when
customers disturb and interrupt them while working. Therefore, for the benefit of customers
and smooth working of bank, there should be a customer care counter to guide and help the
customers.

CHAPTER # 6

CONCLUSION
Based on the findings and recommendation made in the previous chapter of the report, the
action plan for scholarship programs to enhance the education and skill of the deserving
employees is given here as under:REASONS
1. The BoK has about 400 employees and most of them are simple graduates.
2. Persons holding degrees of foreign universities are not keen and willing to join the BoK.
They are always trying to join the multinational companies or foreign banks.
REMEDIES
The following remedies are suggested to cope with the situation.

The BoK should stress on education and experience.

The BoK should constantly give incentives and opportunities to its employees to
enhance and improve their education profile.

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For this purpose the best option, which the BoK can avail, is to started scholarship
program for its employees to study in countrys best universities or aboard to get degree of
MBA or MBA- banking and finance and PhD etc.

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BIBLIOGRAPHY

The Bank of Khyber, personal and Administration Department Manual,

2000.

The Bank of Khyber, Recruitment policy 2000.

The Bank of Khyber, Information Memorandum 1998

NWFP Act No. XIV. (1991)

Koontz, Harold. (1993) Management in Global Perspective; New York;

McGraw Hills, Inc., 10th Edition,

Personal working during internship period.

http://www.bok.com.pk/

http://www.wikipedia.com/

Consulate General of Switzerland, (2011), Pakistan Banking sector, Karachi

Bank

of

Khyber

information

memorandum.

(2009).

Information

Memorandum Peshawar

Bank of Khyber (2009). Annual Report. Peshawar

Bank of Khyber (2010). Annual Report. Peshawar

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