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Branch Banking Concept

Branch is considered as one of the most important channel of the bank and is generally the most preferred channel from the customer's point of view. The branch is referred to as the face of the bank since the customer can visit personally and meet and interact with the branch officials and avail the various services offered by the bank. In reality, the branch is the sales and service channel of a bank and the branch employees are generally responsible for both sales and service of bank's products. Sales in terms of branch banking could be of any of the bank's deposits, products, gold, retail or other investment products of other approved organizations, such as life insurance, general insurance, and mutual fund. The most common examples of deposit products of a bank are savings bank account, current accounts, fixed deposit accounts, and recurring deposit accounts. The customers or the prospects desiring to open any of these accounts have to fill an Account Opening Form [AOF] and submit the specified documents in order to meet the Know Your Customer [KYC] guidelines issued by the Reserve Bank of India [RBI] The examples of a bank's asset products include personal loan, home loan, car loan, and credit card. When a customer approaches the branch for any of the loan products of the bank, the branch employee takes down the contact details of the customer and the record of the lead generated are kept with the bank for follow up action. Sometimes, such leads are escalated to outsourced agencies, such as Direct Sales Agent [DSA] or Direct Marketing Agent [DMA] of the bank. These agencies, in turn, get in touch with the customers for obtaining the necessary documents. The credit decision whether to sanction or not the various loans to the customers is taken by the bank officials in the credit sanctioning department of the bank. In most of the banks, the front office activities that involve customer interaction are handled at the branches, for instance, cash receipts and payments, issue of DD or lockers. The back office activities, such as clearing and account opening may be centralized at a different location away from the branch. Activities like clearing centralize payments of drafts and other instruments, which are related to the local area, may be grouped in to one centre. Certain other activities that are common across centres may be performed at another place for the purpose of achieving efficiency of operation and controlling costs. Services provided at the branches Several services are offered to customers by the bank branches. The following list only covers the main services offered by most of the branches:

Account opening Cash receipts Cash payments Cheque book issue Stop payment of cheques Closure of fixed deposits and premature withdrawals Issue of DDs and banker's cheque Safe deposit lockers Foreign exchange services Gold retail DeMat services Acceptance of clearing cheques Deliverables, such as cheque books, debit cards, PINs and passwords Acceptance of queries and complaints

Investment services Standing instructions Retail loan products

Despite the emergence of several other delivery channels external to the bank, branch banking still remains its utility. This might be due to the advantage of the location of branches enjoyed by the customer. Also, in the current state of development the alternate channels have limited service capabilities which make a branch an extremely useful service and delivery outlet. A branch is capable of handling diverse requirements of a customer in addition to projecting the human feeling arising out of the personal relationship with the branch officials.

Role of Commercial Banks in International Business

Commercial banks facilitate global business by enabling the reliable movement of money. conceptual international business/customer service image by Stasys Eidiejus from Fotolia.com Commercial banks do not create money--they are simply the intermediaries that move money from the capital markets to businesses and institutions. Banks get their money through business checking or deposit accounts, service fees and by issuing certificates of deposit (CD) and banker's acceptances--money market instruments that are collateralized by letters of credit (LOC) used in trade finance--and commercial paper. Commercial banks offer services such as trade finance, project finance, payroll, foreign exchange transactions and trading, lock boxes for collecting payments and general corporate finance.

Significance
Without commercial banks, the international finance and import-export industry would not exist. Commercial banks make possible the reliable transfer of funds and translation of business practices between different countries and different customs all over the world. The global nature of commercial banking also makes possible the distribution of valuable economic and business information among customers and the capital markets of all countries. Commercial banking also serves as a worldwide barometer of economic health and business trends.

Foreign Branch Banking


Some small commercial banks limit their reach to the local business community; but as business has gone global, so have commercial banks. Large banks such as Citigroup, Bank of America and Chase are retail (consumer) banks that also maintain full commercial banking activities in the United States with branches in many countries. These larger banks may act as affiliates of smaller banks that do not have branch presences in

other countries. Through foreign branch banking, U.S. based multinational companies can consolidate their financial business at a single bank that handles their trade finance, currency transactions, project loans, payroll, cash management investments and deposit accounts throughout the world. Commercial banks also arrange deals between their customers globally, including strategic partnerships and project fulfillment agreements.

Trade Finance
Commercial banks doing international business are also called merchant banks because they finance trade between companies and customers located in different countries. This is done by issuing LOCs that indicate the customer has deposited the full amount due on an order with a company located in a different country. The seller company can then feel assured of being paid if it ships goods to its offshore customer. The LOC may also be used by the company to guarantee a manufacturer's loan, allowing it to finance the manufacture of the goods to be delivered. Without LOCs, companies would face considerable expense in investigating their foreign customers to make sure they are legitimate and creditworthy, and complying with laws and regulations of the different countries in which they do business.

Foreign Exchange
In order to facilitate international trade and development, commercial banks convert and trade foreign currencies. When a company is doing business in another country it may be paid in the currency of that country. While some of these revenues will be used to pay workers in that country and for administrative expense such as office rent, utilities and supplies, the company may need to purchase goods from a neighboring country in that country's currency, or convert cash to its native currency for return to the home office.

Corporate Finance
Companies always need to borrow money to cover purchases of raw materials, machinery parts, inventory and/or payroll. Banks with overseas branches or affiliates can simplify the process of corporate finance throughout a company's organization by consolidating the transaction procedures, reporting and record keeping. It is much easier for a company manager to do business in her own language with a banker located nearby who handles her global business finance needs than it would be for her to develop banking relationships in every country where she does business. Her international commercial bank can also provide referrals to professional service firms in other countries, as well as arrange introductions to other companies appropriate as customers or for strategic partnerships.

Miscellaneous Banking Services


Corporate checking accounts, currency specific credit cards and lock boxes are also offered by commercial banking to help make foreign trade possible for a company. Lock boxes are particularly helpful for collecting payments from overseas customers and reporting receipts daily for cash management purposes. Currencyspecific credit cards are also important in eliminating the cost of cross currency purchasing, which normally is done at expensive valuation levels

State Bank of Pakistan

History
Before independence on 14 August 1947, during British colonial regime the Reserve Bank of India was the central bank for both India and Pakistan. On 30 December 1948 the British Government's commission distributed the Reserve Bank of India's reserves between Pakistan and India -30 percent (750 M gold) for Pakistan and 70 percent for India.

The losses incurred in the transition to independence were taken from Pakistan's share (a total of 230 million). In May, 1948 Muhammad Ali Jinnah (Founder of Pakistan) took steps to establish the State Bank of Pakistan immediately. These were implemented in June 1948, and the State Bank of Pakistan commenced operation on July 1, 1948

Muhammad Ali Jinnah, the founder of Pakistan, making a speech at the opening of the State Bank of Pakistan. Under the State Bank of Pakistan Order 1948, the state bank of Pakistan was charged with the duty to "regulate the issue of bank notes and keeping of reserves with a view to securing monetary stability in Pakistan and generally to operate the currency and credit system of the country to its advantage". A large section of the state bank's duties were widened when the State Bank of Pakistan Act 1956 was introduced. It required the state bank to "regulate the monetary and credit system of Pakistan and to foster its growth in the best national interest with a view to securing monetary stability and fuller utilisation of the countrys productive resources". In February 1994, the State Bank was given full autonomy, during the financial sector reforms. On January 21, 1997, this autonomy was further strengthened when the government issued three Amendment Ordinances (which were approved by the Parliament in May 1997). Those included were the State Bank of Pakistan Act, 1956, Banking Companies Ordinance, 1962 and Banks Nationalisation Act, 1974. These changes gave full and exclusive authority to the State Bank to regulate the banking sector, to conduct an independent monetary policy and to set limit on government borrowings from the State Bank of Pakistan. The amendments to the Banks Nationalisation Act brought the end of the Pakistan Banking Council (an institution established to look after the affairs of NCBs) and allowed the jobs of the council to be appointed to the Chief Executives, Boards of the Nationalised Commercial Banks (NCBs) and Development Finance Institutions (DFIs). The State Bank having a role in their appointment and removal. The amendments also increased the autonomy and accountability of the chief executives, the Boards of Directors of banks and DFIs. The State Bank of Pakistan also performs both the traditional and developmental functions to achieve macroeconomic goals. The traditional functions, may be classified into two groups: 1. The primary functions including issue of notes, regulation and supervision of the financial system, bankers bank, lender of the last resort, banker to Government, and conduct of monetary policy. 2. The secondary functions including the agency functions like management of public debt, management of foreign exchange, etc., and other functions like advising the government on policy matters and maintaining close relationships with international financial institutions. The non-traditional or promotional functions, performed by the State Bank include development of financial framework, institutionalisation of savings and investment, provision of training facilities to bankers, and provision of credit to priority sectors. The State Bank also has been playing an active part in the process of islamisation of the banking system.

List of banks in Pakistan


From Wikipedia, the free encyclopedia Jump to: navigation, search The following is the list of banks in Pakistan. State Bank of Pakistan

Contents
[hide]

1 Nationalized scheduled banks 2 Specialized banks 3 Card Issuers 4 Development financial institutions 5 Commercial banks 6 Investment banks 7 Discount and guarantee houses 8 Housing finance companies 9 Micro finance banks 10 Islamic banks 11 Upcoming or transaction in process 12 Notes 13 See also 14 External links

[edit] Nationalized scheduled banks


The Bank Of Khyber[1] The Bank of Punjab[2] Sindh Bank[3]

[edit] Specialized banks


Arslaan Bank Limited Ayub Bank Limited Industrial Development Bank[4] Karakorum co-operative bank LTD Punjab Provincial Cooperative Bank[5] SME Bank[6] Zarai Taraqiati Bank Limited[7]

[edit] Card Issuers


Allied Bank Limited[8] Askari Bank Limited[9] Bank Alfalah Limited[10] Bank AL Habib[11] Barclays Bank Pakistan[12] Citibank Pakistan[13]

Faysal Bank Limited[14] First Women Bank Habib Bank Limited[15] Habib Metropolitan Bank Habib Bank AG Zurich HSBC Pakistan JS Bank MCB Bank Limited[16] MyBank NIB Bank Pakistan Royal Bank of Scotland Pakistan Standard Chartered Bank Pakistan[17] Silk Bank Limited (Formerly Saudi Pak Commercial Bank Ltd) Soneri Bank Summit Bank Limited (formerly known as Arif Habib Bank)[18] United Bank Limited[19]

[edit] Development financial institutions


House Building Finance Corporation, Karachi Investment Corporation of Pakistan, Karachi National Savings center, Islamabad Pak Brunei Investment Company Limited, Karachi [1] Pak China Investment Company Limited, Islamabad Pak Iran Joint Investment Company Limited, Karachi Pak Kuwait Investment Company Limited, Karachi Pak Libya Holding Company Limited, Karachi Pak-Oman Investment Company Limited, Karachi Saudi Pak Industrial and Agricultural Investment Company Limited, Islamabad

[edit] Commercial banks


This section may require cleanup to meet Wikipedia's quality standards. (Consider using more specific cleanup instructions.) Please help improve this section if you can. The talk page may contain suggestions. (November 2010)

Allied Bank Limited Askari Bank Bank Alfalah Bank AL Habib Barclays Bank Pakistan CitiBank Pakistan Faysal Bank First Women Bank Habib Bank Limited Habib Metropolitan Bank Habib Bank AG Zurich HSBC Pakistan JS Bank KASB Bank Ltd MCB Bank Limited MyBank National bank of Pakistan NIB Bank Pakistan

Royal Bank of Scotland Pakistan Standard Chartered Bank Pakistan Silkbank Limited (Formerly Saudi Pak Commercial Bank Ltd) Soneri Bank Summit Bank (formerly known as Arif Habib Bank)[20] United Bank Limited

[edit] Investment banks


This section may require cleanup to meet Wikipedia's quality standards. (Consider using more specific cleanup instructions.) Please help improve this section if you can. The talk page may contain suggestions. (June 2007)

Al towfeek Investment Bank Limited AMZ Securities Atlas Investment Bank Limited BMA Capital Management Limited Escorts Investment Bank Limited First Investment Bank Limited Invest Capital Investment Bank Limited JS Investment Bank Limited Orix Leasing (Pakistan) Limited Trust Investment Bank Limited

[edit] Discount and guarantee houses


First Credit & Discount Corp Limited National Discounting Services Limited Speedway Fordmetall (Pakistan) Limited

[edit] Housing finance companies


Asian Housing Finance Limited Citibank Housing Finance Company Limited House Building Finance Corporation International Housing Finance Limited Pak Libya Mortgages

[edit] Micro finance banks


The First Micro Finance Bank Limited Karakuram Bank Kashf Microfinance Bank Limited Khushali Bank Limited Network Micro Finance Bank NRSP Micro Finance Bank Limited Pak Oman Micro Finance Bank Rozgar Micro Finance Bank, Karachi Tameer Microfinance Bank Limited

[edit] Islamic banks

AlBaraka Islamic Bank (Merged into Al Baraka Bank (Pakistan) Limited[21]) BankIslami Pakistan Limited Burj Bank Dubai Islamic Bank Pakistan limited Emirates Global Islamic Bank Limited (Merged into Al Baraka Bank (Pakistan) Limited[22]) Meezan Bank Limited-Premier Islamic Bank In Pakistan

[edit] Upcoming or transaction in process


Al barka islamic bank, Dubai will acquire Emirates Global Islamic Bank, Pakistan Faysal Bank has signed sale agreement with The Royal Bank of Scotland - Pakistan .The Royal Bank of Scotland - Pakistan [2] Qatar Islamic Bank is looking to expand its operation in Pakistan in the cities of Karachi, Lahore and Islamabad.

[edit] Notes
1. ^ The Bank Of Khyber 2. ^ The Bank of Punjab 3. ^ Sindh Bank 4. ^ Industrial Development Bank of Pakistan 5. ^ Punjab Provincial Cooperative Bank 6. ^ SME Bank 7. ^ Zarai Taraqiati Bank Limited 8. ^ Allied Bank Limited 9. ^ Askari Commercial Bank 10. ^ Bank Alfalah 11. ^ Bank AL Habib 12. ^ Barclays Bank Pakistan 13. ^ Citibank Pakistan 14. ^ Faysal Bank 15. ^ Habib Bank Limited 16. ^ MCB Bank Limited 17. ^ Standard Chartered Bank Pakistan 18. ^ Summit Bank 19. ^ United Bank Limited 20. ^ Credit Card Issuers in Pakistan 21. ^ http://www.albaraka.com.pk/press-releases/2010/oct/30/press.php 22. ^ http://www.albaraka.com.pk/press-releases/2010/oct/30/press.php Bank Islami is acquiring emirates global islamic bank , it has submitted its papers to SECP for finalizing.

[edit] See also


Economy of Pakistan Index of the Karachi Stock Exchange Islamic banking

[edit] External links


Banks in Pakistan Banks in Pakistan database Banks in Pakistan with products they offer

Pakistani Banks Silkbank Limited State Bank of Pakistan The Pakistan Credit Rating Agency Limited