Professional Documents
Culture Documents
Internship Report
ACKNOWLEDGEMENT
No one can say that I am perfect, everyone should admit that without the help
of ALLAH and His people a man cant get anything so I bow my head before almighty
Allah with gratitude. I am also very much thankful and presents salute to many
individuals who have helped me in shaping this report .I am also very much thankful
to lot of former fellows and contemporary colleagues who took the time and trouble
during the last few days to speak to me about the way this text could be further
improved. I have no words to express my gratitude to my advisor BZU Business
Administration for intellectual guidance without which it could have been rather
difficult for me to complete this report.
I am also very thankful to the staff LESCO (Lahore Electric Supply Company
Limited) Office Of Chief Financial Officer and especially to every Department where I
worked who provided me an opportunity to work in friendly environment.
Table of Contents
No.
Description
Page No.
Internship Report
01
Executive Summary
03
02
Evolution of Banking
04
03
05 to 09
10 to 19
SWOT Analysis
20
06
Operations of HBL
25 to 57
58 to 64
63 to 73
09
Recommendations
74
10
76 to 80
executive summary
Every student of Master in Business Administration at COMSATS Institute of
Information Technology has an essential requirement to do Six to Eight weeks
internship in any of the well reputed organization. The purpose of this program is to
acquaint the students with practical applications of theoretical concepts taught to
them during conduct of their MBA program. The internship in Habib Bank was
arranged by the job placement cell of the institute. Really, it was a nice opportunity to
have a close comparison of theoretical concept in practical field, involving the use of
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primary and secondary data. All the efforts on the way are summarized in shape of
this Internship Report. Report starts with the topic evolution of banking. The word
'Bank' is said to have been derived from the words Bancus or Banque or Bank. This
history of banking is traced to as early as 2000 B.C. Talking about commercial
banking in Pakistan It was very difficult for Pakistan to build up its own Banking
system immediately after independence without sufficient resources. By 30th June
1948 the number of schedule banks in Pakistan declined from mere scratch. Today
there are more than 7000 branches of commercial banks along with an established
network of supplementary financial institutions. All this development in the banking
sector is the result of untiring efforts of six decades. HBL was the first commercial
bank to be established in Pakistan in 1947. Over the years, HBL has grown its
branch network and become the largest private sector bank with over 1,450
branches across the country and a customer base exceeding five million
relationships.
On December 29, 2003 Pakistan's Privatization Commission announced that
the Government of Pakistan had formally granted the Aga Khan Fund for Economic
Development (AKFED) rights to 51% of the shareholding in HBL, against an
investment of PKR 22.409 billion (USD 389 million). This report contains information
about HBLs board of directors, management, mission, vision and values. HBLs
operations are discussed in light of its working department in the branches like cash,
clearing, foreign exchange and accounts department and also in light of its services
and products which it is offering to customers weather they are individual, business,
corporate or agriculture field related customers. HBL is currently offering phone
banking, internet banking and various cash management services for the facilitation
of its customers. HBLs car to car loan has its own uniqueness in Pakistans banking
sector. HBLs branch network is extended all over the Pakistan which has its
competitive edge over all other private sector banks in Pakistan.
During the time of my internship in Habib Bank Jinnah Chowk branch Sahiwal
I got the chance to work in all the departments of HBL working there. Duties and
learning in each department is given in this report. Talking about financial
performance of the bank in 2008 all the financial indicators are showing positive
results when the financial performance of the bank in 2008 is compared with
financial performance of 2007. During 2008 HBL also won some awards. At the end
of this report I have given my suggestion for the improvement of the bank.
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Evolution of banking
The word 'Bank' is said to have been derived from the words Bancus or
Banque or Bank. This history of banking is traced to as early as 2000 B.C. The
priests in Greece used to keep money and valuables of the people in temples. These
priests thus acted as financial agents. The origin of banking is also traced to early
goldsmiths. They used to keep strong safes for storing the money and valuables of
the people. The persons who had surplus money found it safe and convenient of
deposit their valuables with them. The first stage in the development of modern
banking, thus, was the accepting of deposits of cash from those persons who had
surplus money with them.
The goldsmiths used to issue receipts for the money deposited with them.
These receipts began to pass from hand to hand in settlement of transactions
because people had confidence in the integrity and solvency of goldsmiths. When it
was found that these receipts were fully accepted in payment of debts; then the
receipts were drawn in such a way that it entitled any holder to claim the specified
amount of money from goldsmiths. A depositor who is to make the payments may
now get the money in cash from goldsmiths or pay over the receipt to the creditor.
These receipts were the earlier bank notes. The second stage in the development of
banking thus was the issue of bank notes.
The goldsmiths soon discovered that all the people who had deposited money
with them do not come to withdraw their funds in cash. They found that only a few
persons presented the receipts for encashment during a given period of time. They
also found that most of the money deposited with them was lying idle. At the same
time; they found that they were being constantly requested for loan on good security.
They thought it profitable to lend at least some of the money deposited with them to
the needy persons. This proved quite a profitable business for the_ goldsmiths. They
instead of charging safe keeping charges from the depositors began to give them
interest on the money deposited with them. This was the third stage in the
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development of banking.
COMMERCIAL BANKING IN
PAKISTAN
It was very difficult for Pakistan to build up its own Banking system
immediately after independence without sufficient resources. Following the
announcement of the partition plan in June 1947 there was a haste movement on the
parts of banks to transfer their funds and accounts across the borders. The banks
having their registered offices in Pakistan were transferred to India. In an effort to
bring about the collapse of the new state by the persecuting an international policy of
withdrawal, the Indian bank offices closed quickly. Those banks, which stayed, were
considering the winding up of their business. By 30th June 1948 the number of
schedule banks in Pakistan declined from mere scratch.
Today there are more than 7000 branches of commercial banks along with an
established network of supplementary financial institutions. All this development in
the banking sector is the result of untiring efforts of four decades.
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studying the growth of this sector we can divide it into three stages, which are as
follows:
a)
Pre-Nationalization Era
b)
Nationalization Era
c)
At the time of partition there were 631 bank branches in area which came
under Pakistani control. But due to blood shed and violence at large scale, mostly
branches were closed and the disparity can be assessed from the fact that on July
1948 there were 195 branches with deposits of Rs.88 crore (880 million) only. Also a
factor lagging in Pakistani industry was a central bank of its own, by that time
Reserve Bank of India was acting as central bank for both countries and same
currency notes were used in both territories. But Reserve Bank of India was biased
and Set down Pakistan on many occasions such as the issue of funds transfer etc.
In this period drastic steps were taken in government sector for the
improvement of overall position. The private sector also responded to these changes
and some very positive changes were observed. Some of the steps taken by the
government in this regard were as under:
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NO. OF BRANCHES
DEPOSITS
(Rs in Million)
HBL
667
6,160
NBP
579
5,660
UBL
497
5,670
MCB
506
1,640
ABL
145
570
B) NATIONALIZATION PERIOD
On January 01, 1974 all Pakistani banks were nationalized through
Nationalization Act 1974. Under this law all Pakistani banks became a public
property. All small banks were merged in bigger banks to create 5 major Pakistani
banks Pakistani banks. These banks were to control by Pakistan Banking Council.
There are still controversies about this act of government as whether it contributed in
success of failure of banks. However the major changes after nationalization were as
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follows:
However the effect of expansion was enormous and it can also be depicted
with the help of table 2 which shows the deposit & branch positions of different
nationalized banks.
C)
No. of Branches
HBL
1926
153,431
NBP
1448
128,679
UBL
1684
87,482
MCB
1288
50,013
ABL
750
33,757
TOTAL
7096
453,362
institutes. Some was also suggested in banking sector. For this purpose,
amendments were made to Nationalization Act 1974 and two nationalized banks
were privatized. Along with this a permission to open banks in private sector was
also granted. The rules regarding establishment of new banks and for incoming
foreign banks were also relaxed.
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expanding its presence in principal international markets including the UK, UAE,
South and Central Asia, Africa and the Far East. Key areas of operations encompass
product offerings and services in Retail Banking. HBL has the largest Corporate
Banking portfolio in Pakistan with an active Investment Banking arm. SME and
Agriculture lending programmes and banking services are offered in urban and rural
centers. In the UK and GCC, HBL focuses on trade finance and remittances for the
South Asian Diaspora in addition to basic banking facilities. HBL has always been a
bank and a brand for the masses, with a history that is inextricably linked with the
history of Pakistan itself. As it continues to grow, both locally and abroad, it strives to
embody its brand personality: honest, approachable, and inclusive. HBL is currently
rated AA+ (Long term) and A1+ (Short term)*. It is the first Pakistani bank to raise
Tier II Capital from external sources.
It was
established with a paid up capital of Rs. 2.5 million. At an early stage, the number of
its branches was only 12.
HBL established operations in Pakistan in 1947 and moved its head office to
Karachi. Our first international branch was established in Colombo, Sri Lanka in
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1951 and Habib Bank Plaza was built in 1972 to commemorate the banks 25th
Anniversary. With a domestic market share of over 40%, HBL was nationalized in
1974 and it continued to dominate the commercial banking sector with a major
market share in inward foreign remittances (55%) and loans to small industries,
traders and farmers. International operations were expanded to include the USA,
Singapore, Oman, Belgium, Seychelles and Maldives and the Netherlands.
Mission
To make our customers prosper, our staff excel and create value for shareholders.
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Values
Our values are the fundamental principles that define our culture and are brought to
life in our attitude and behaviors. It is these values that make us unique and
unmistakable. Our values are defined below:
Excellence
This is at the core of everything we do. The markets in which we operate are
becoming increasingly competitive, giving our customers an abundance of choice.
Only through being the very best in terms of the service we offer, our products and
premises - can we hope to be successful and grow.
Integrity
We are the leading bank in Pakistan and our success depends upon trust. Our
customers - and society in general expect us to possess and steadfastly adhere to
high moral principles and professional standards.
Customer Focus
We understand fully the needs of our customers and adapt our products and
services to meet these. We always strive to put the satisfaction of our customers
first.
Meritocracy
We believe in giving opportunities and advantages to our employees on the basis of
their ability. We believe in rewarding achievement and in providing first-class career
opportunities for all.
Progressiveness
We believe in the advancement of society through the adoption of enlightened
working practices, innovative new products and processes and a spirit of enterprise.
Board of Directors
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NAME
DESIGNATION
CHAIRMAN
R. Zakir Mahmood
Mushtaq Malik
DIRECTOR
Ahmed Jawad
DIRECTOR
Yasin Malik
DIRECTOR
Moez Jamal
DIRECTOR
MANAGEMENT
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Management Hierarchy
PRESIDENT
BOARD OF DIRECTOR
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REGIONAL CHIEF
ZONAL CHIEF
BRANCH MANAGERS
DESIGNATIONS
President
Senior Executive Vice President (SEVP)
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Corporate Information
Head Office
HBL Plaza
I. I. Chundrigar Road
Karachi-75650, Pakistan.
Tel : +92 (21) 2418000 [50 lines]
Fax : +92 (21) 9217511
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Registered Office
4th Floor, Habib Bank Tower
Jinnah Avenue
Islamabad, Pakistan.
Tel: +92 (51) 2872203
Fax: +92 (51) 2872205
Registrars
THK Associates (Pvt.) Ltd.
Ground Floor, State Life Bldg No. 3
Dr. Ziauddin Ahmed Road
Karachi, Pakistan.
Tel: +92 (21) 111-000-322
Websites
Corporate website:
www.hbl.com
Treasury website:
www.hblgtr.com.pk
Ebank (internet banking):
www.hblebank.com
Auditors
KPMG Taseer Hadi & Co.
Chartered Accountants
Global location
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Global locations
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Swot analysis
Strengths
Strength can be defined as an area where a company is best at doing
something or a feature that puts the company at an advantage in comparison to its
competitors. HBL enjoys the following strengths:
HABIB BANK is a well established bank enjoying long history of over 65 years
of experience and profitable operation.
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HBL is the largest private bank in Pakistan now and people trust is very high.
It has the largest branch network among private banks of Pakistan.
HBL has been very effective in controlling costs as it successfully restructured
itself after its privatization. During this process more than 1,600 employees
were relieved under a golden handshake scheme and 110 branches were
closed.
Excellent branches appearance gives an edge to HBL over other banks. The
branches are well furnished even in less developed areas where other banks
branches give a poor view.
HBL has the ability to bring innovative products and services like personalized
service, electronic funds Transfer, sophisticated financial products such as
electronic banking, auto-teller machines and evening banking.
The Banks Rupee Traveler Cheques have been market leaders for the past
six years.
HBLs car to car financing scheme is unique in auto loan segment.
Habib bank is an internationally recognized name in banking services and
products.
HBL has forged strategic alliances with international banks for expanding its
network further, both locally and internationally.
Weaknesses
A weakness is defined as an area in an organization where the organization is not as
good at doing something as its competitors or a thing which an organization lacks
thus putting the organization at disadvantage in comparison to its competitors.
Based on the above definition, HBL has the following weaknesses.
Lack of communication between bank and customers about terms and
condition of products and services. Like centralization of cheque book issuing
process.
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Employees at branch level are not properly motivated to work by heart. They
take the all routine activities as a boring job.
Most of the employees lack managerial training as they are not properly
educated. Due to seniority, they have moved up on the hierarchy line to
Grade-I, II or III positions having hardly bachelor degrees. This type of senior
staff cannot apply the modern and innovative techniques of management in
decision making.
Mission of HBL is not well defined.
Though HBL is second largest bank in Pakistan, yet the fact remains that it is
not market leader as NBP. Its total assets are always less than NBP total
assets.
Now as it is a privatize bank that is why GOVERNAMENT support to HBL
decreased as it was in past
Opportunities
An opportunity can be defined as a change in external environment which if properly
exploited with the organizational strengths will result in enhanced sales, market
share, or income. Using its strengths, HBL can avail the following opportunities.
Opportunities require explanation therefore I have used headings instead of arrows
E-Banking
Generally speaking, three factors, quickness, easiness and cheapness have become
the catchwords for the competitiveness and usefulness of all the business
operations. Particularly it is commonplace today to say that banking is undergoing a
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radical transformation. The symptoms are new products, new players, new channels
etc. This transformation is taking place across all sectors of the banking industry.
That is why Habib bank urgently needs to improve their ability, to think strategically
about IT investments. Only those banks that use their technology resources
effectively have the opportunity to secure real competitive advantage in this fastchanging industry through real product or service differentiation.
High mark up rates
Of late markup rates have increased considerably. Present rates are 4% above
KIBOR i.e. 16% appx. High markup rate has decreased the interest of people in
loaning from from banks. Habib bank can increase its income by offering loan at
lower interest rate than other banks.
ONLINE BANKING
It is doing banking transactions through our home P.C. The banks that do business
through net have Websites. The customer clicks into the Website and gets the
history of the bank. Then he can demand the necessary application form through the
net. He fills in the form and passes it on to the bank. The Online banking is fast
gaining ground in Pakistan. Some software companies are also offering networkbanking facilities. So Habib bank should focus heavily on providing online banking
faculties to its customers. Currently it is doing the same.
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markets, railway stations etc, and can well be linked to the main computer. It allows
customers to transact with the bank 24 hours a day and 365 days a year. They allow
the customers to transfer money to and from accounts to view account information,
to receive cash. It can also be used to deposit cheques and cash into the
accounts. No bank in Pakistan is offering this service currently. So an opportunity
exists for Habib bank to differentiate.
Rate of return
The range and choice of products available & offered by the commercial banks is
limited. Rates of Return / Profits on Deposits are so low and unattractive that very
limited options are available to the depositors. They do not match the current rate of
inflation. HBL differentiate and increase its deposit by offering attractive rate of
return on deposits.
Threats
Threat can be defined as a change in external environment which if not met with
proper strategies will result in loss of revenues, market share, or income. In the
context of HBLs external environment, the following potential threats exist:
Other private commercial bank with sound profitability is also a threat to HBL
e.g. UBL, Alfalah, MCB etc
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Operations of HBL
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Various departments are working in all the branches of Habib bank to facilitate the
customers. Following are the banking departments functioning in HBL Jinnah Chowk
branch Sahiwal.
1.
2.
Cash department.
3.
Credit department.
4.
Lockers department.
5.
6.
7.
I.T department.
Accounts opening
department
Basic function of the accounts department is to open new account and facilitate the
customer for the account opening purpose. There are certain formalities which are to
be observed for opening of an account with a Bank. These formalities in brief are as
under:
FORMAL APPLICATION:
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Types of accounts:
Individual accounts:
Individual accounts are the most common personal investment accounts. Opened by
single person.
JOIN ACCOUNT:
A joint account occurs when two or more than two customers have one account. The
parties to a joint account are considered in law as they are one person.
Business accounts:
Business accounts can be opened by institutions, companies, partnerships, trusts
and non-profit organizations. Following documents are required.
Cheque Book
A chequebook contains a number of cheques, which is given to a customer upon
written request and after marking the payment for the chequebook. It enables a
customer to make withdrawal from his account or make payment to various parties
by issue of cheques.
GROUNDS FOR CLOSING THE CUSTOMERS ACCOUNT:
The banker may close the account of the customer due to following reasons:
i. Notice by a Customer
ii. Death of a Customer
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Cash department
ash Department is very sensitive and risky part of the bank. Very
causations and competent personnel are needed for the Job. HBL has
really such a diligent staff with appreciable competencies and will to do
work. Main function of cash department is to deal with cash payment and cash
receipts.
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The customer fills the pay slip. The cashier receives the pay slip and cash. He
counts the cash and makes the detail of the notes at the back of the pay slip. Then
he compares the detail with amount written on slip and signs the pay Slip. Then he
credits the entries in the computer by serial No, account type, Account number and
amount. Puts the stamp of the cash Received on the payment slip. The first portion
is for bank record while other one is given to the customer.
CREDIT DEPARTMENT
1. Introduction
2. Securities.
3. Types of credits
INTRODUCTION
The function of credit department is to lend money in the form of clean advances,
against promissory notes, as well as secured advances against tangible and
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marketable securities. The bankers prefer such securities that do not run the risk of
general depreciation due to market fluctuations.
Common Securities for the bankers advances are as under:SECURITIES
1. Guarantees
When an application for advance cannot offer any tangible security, the banker may
rely on personal guarantees to protect himself against loss on advances or overdraft
to the applicant.
2. Mortgage
A mortgage is the transfer of an interest in specific immovable property for the
purpose of security the payment of money advanced or to be advanced by way of
loan, and existing or future debt, or the performance of an engagement which may
rise to a pecuniary liability. The transfer is called a mortgagor, the transferee a
mortgage.
3. Hypothecation
When property in the shape of goods is charged as security for a loan form the bank
the ownership and possession is left with the borrower, the goods are said to be
Hypothecated The essence of hypothecation is that neither the property in the goods
not the possession of them are possession is left with the borrower, the goods are
said to be Hypothecated the essence of hypothecation is that neither the property in
the goods not the possession of them are possessed by the lender, but the security
is granted by means of letter of hypothecation, which usually provides for a bankers
charge on the hypothecation goods.
4. Pledge
In a pledge the ownership remains with pledge, but the pledge has the exclusive
possession of property until the advance is repaid in full. While in case of the default
the pledge has the power of sale after giving due notice.
5. Promissory Note
Sometimes promissory note is also accepted as a security, "A promissory note is an
instruments in writing containing an unconditional undertaking signed by the maker,
to pay on demand or at a fixed or determinable future time a certain sum of money
only, to or to the order of certain persons, or to the bearer or the instrument." A
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promissory note is incomplete until has been delivered to payee or the bearer.
Moreover, the sum promised in a promissory note may be made by two or more
makers who may be liable there on jointly and severally.
TYPES OF ADVANCES
The advances which are given by Habib Bank Limited are as under:1. DEMAND FINANCE (Ordinary Loan)
Demand Finances are those advances which are allowed in lump sum for a fixed
period and are repayable lump sum or gradually in installments.
TYPES OF ADVANCES
a. Demand Finance (Packing Credit)
Scheme introduced by State Bank of Pakistan for exporter of carpet, surgical
instruments, at zero percent rate of interest. While banks provides at
concessional rate of interest.
b. Loan ordinary (Demand Finance to Students)
Qarz-e-Hasana Scheme Loans are allowed to the students, teachers without
any interest or mark up with the recommendations of the MPA or MNA.
c. Demand Finance (Staff)
Loans are offered to the staff of the following four categories.
i. House Building Loans against mortgage of property.
ii. Loan for purchasing vehicles.
iii. Loan equivalent to months salary.
2. RUNNING FINANCE (Overdraft)
Running finance (old name overdrafts) are advances, which are generally, given to
meet temporary requirements of the customers. A good customer use the banks
running finance limit as a mean of protecting his credit in the market and as a line of
security defense to meet his commitments.
TYPES OF RUNNING FINANCE
I. Unsecured
Under such type of overdraft the bank pay upon the personal security of the
customers mentioned on the customers account.
II. Secured
Under this type of overdraft the bank allows his customer to withdraw more
than his deposits after giving security against the amount overdrawn.
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Agricultural inputs
Tube wells
Live Stock Framing
Land improvement
5. INDUSTRIAL LOANS
Besides the short-term loans which play a part in working capital medium and longterm loans are also given to industrial sector for purchase of machinery and other
capital nature goods.
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Transfer Deliver cheques are those cheques, which are collected and paid by
two different branches of a bank, situated in the same city.
c. Clearing Cheques
Clearing cheques are those cheques in which the payee (Person who deposit
cheques for collection) and the drawer of a cheque maintain the account with
different banks.
These clearing instruments are handed over to NIFT after posting necessary
stamps and checking them for any errors. Then further process of clearing is carried
on the behalf of NIFT.
Forex Department
International trade is growing and with the development of international trade
it has become more imperative. For countries to devote more and more attention to
the complicated mechanism of Foreign Exchange. It is more important in case of
developing countries. It is need of time, that a country should conserve its foreign
exchange resources.
MEANING OF FOREIGN EXCHANGE
The foreign exchange term refers to the principles that determine the rate of
exchange. It covers following three senses:
i. The mechanism or system by which international obligations or indebtedness
are fulfilled.
ii. The currency of one country is exchanged for that of another.
iii. The principles on which the people of world settle their debts to one another.
Letter of Credit:
It is a negotiable instrument through which the bank of the exporter deals with bank
of the importer through the guarantee of a bank. There are different parties involved
in the L/C, e-g importer, exporter, importer bank, exporter bank, and advisory bank.
LC involves banking channels in foreign trade to mitigate risk.
The procedure of opening of an L/C is as follow
The first thing is the Performa invoice. The Performa invoice is a document
(say a clip), which is, sends by the exporter to the importer and includes the
information like. Descriptions of goods, what type of goods you are needed
and what are the quality, rate and originating country etc.
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Before to open a L/C the bank also consider that the goods which the importer
is importing is allowed by govt. of Pakistan or not. Because the importer is not
allowed to import that goods which are prohibited by the Govt. of Pakistan.
The importer is asked to show the membership certificate of any chamber of
commerce and industry affiliated with the Pakistan federation of chamber of
commerce and industry.
Fill the import form of the govt. of Pakistan, which is the proof of this that there
is no objection on the goods, which the customer is importing.
What type of goods you are needed and what are the quality, rate and
originating country etc.
Necessary Documents required for L/C:
NTN
Tax Authority registration certificate
Chamber of Associations trade certificate
Type of Business
NIC
Margin
Registration No.
Application for L/C
On providing these documents the importer will be given the L/C form named as
IB-8.
Contents of IB 8
1. Request for LC
2. Rate
3. Importer and Exporters particulars
4. Amount
5. Terms
6. Partial Shipment (Allowed, not allowed)
7. Transshipment (Allowed, Not Allowed)
8. Port of Loading and destination
9. Payment Mode
I. Sight
On seeing the documents the importer has to pay.
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Retail Banking
For
Individual Customers
Deposit Accounts
Current Accounts
Make unlimited transactions while maintaining a low minimum balance every month.
HBL is currently offering three types of accounts in current account category. Their
detail and name is as under.
1. HBL BusinessValueAccount
2. Current Account
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HBL BusinessValueAccount
Unique transactional account for Businessmen
Up to 5.35%* profit per annum
Profit calculated daily, paid every quarter
Minimum balance of Rs. 20,000
HBL DebitCard and Inter Branch Transaction System (IBTS) facilities
Up to 10 Bankers Cheques free (at minimum balance of Rs. 500,000)
Funds transfer to any bank through HBL PhoneBanking
Current Account
Minimum balance of Rs. 5,000
Unlimited transactions
Non-profit bearing
HBL DebitCard and Inter Branch Transaction System (IBTS) facilities
Funds transfer to any bank through HBL PhoneBanking
Savings accounts
Avail the flexibility of making transactions while earning profit on daily/monthly basis.
HBL is currently offering five types of accounts in savings account category. Their
detail and name is as under.
1. HBL Value Account
2. PLS-Savings Account
3. Remittance Munafa Plus Savings Account
4. Daily Munafa Account
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PLS-Savings Account
5.06% profit per annum*
Profit paid bi-annually
HBL DebitCard and Inter Branch Transaction System (IBTS) facilities
Funds transfer to any bank through HBL PhoneBanking
Minimum balance of Rs. 20,000
Unlimited transactions
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Terms Accounts
Invest your savings in HBL term deposits for a fixed duration and earn profit while
keeping your savings secure. HBL is currently offering one type of account in terms
account category. Their detail and name is as under.
1. HBL Advantage Account
Profit at maturity
7.50%*
8.00%*
11.00%*
13.00&*
14.00%*
17.00%*
FC-SB
Savings Account offered in 3 currencies, USD (US dollar), EUR (Euros) and
GBP (UK pound)
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*NOTE: All the rate and terms and condition are revised by HBL after every six
months periods. These rates are only applicable for period 01.07.09 to 31.12.09.
Further detail of terms and conditions about profit and rates is given in annex B.
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Features
Choice of used, new local/imported and reconditioned imported car.
Repayment options ranging Upto 7 years.
Upto 85% of financing for the car of your choice.
Insurance at all times for complete peace of mind and security.
Round the clock support available through HBL PhoneBanking; you can place
your requests and queries, track the status of your repayment/loan account
and avail other value-added services through HBL PhoneBanking.
Eligibility Criteria
How to apply
Just visit any HBL branch or Habib Bank Auto Finance Centre for details and
application.
Submit complete set of application without any charges to the branch or the
Auto Center.
Sign the necessary documents on approval of the application
Payment is released within 24 hours of the submission of post-dated cheques
and initial payment after approval of the request.
Documentation
Salaried Individuals
Complete Application Form
Salary Certificate / Most recent Salary Slip
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Features
Pay only for what you use
When customer lease a car under HBL CarToCar, he only pay for that part of the
cars value that he use during the lease term. The cars residual value (forecasted for
the end of the specific lease term) is agreed with him at the start of the lease term.
This amount is deducted from the car price thus lowering the finance amount. This
finance amount is based only on a part of the cars value and not the full value of the
car. Therefore, HBL CarToCar offers very low installments as compared to any
conventional financing.
Upgrade of lifestyle
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HBL gives customer the guarantee that if he wishes to return the car to HBL at the
end of the lease term, he will not have to pay off the cars residual value. Instead,
HBL will directly settle this outstanding liability for customer under the buy back
guarantee. Hence, he can upgrade to a new car as frequently as two years without
any complication and hassle.
Affordability
With HBL CarToCar, customer only has to pay the difference between the car price
and the pre-agreed residual value to the bank. As a result, the monthly installment
may even be 40% to 50% less than that of conventional financing.
Flexibility
HBL CarToCar offers customers several choices at the end of the lease term:
Upgrade - Simply return the car to HBL and drive a new one home
Walk away - Return the car to HBL and end the lease
Buy - Keep the same car. Just make a one-time settlement of the cars residual
value to HBL or pay the same in easy installments over a specified extended period
of time
Sell - Enjoy the gain from selling off the car at a higher price in the market than
what you ay HBL as the residual value
Eligibility Criteria
Documentation
Salaried Individuals
Complete Application Form
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By the help of HBL credit card customer enters into the world of convenience and
flexibility. Accepted at over 29 million merchants worldwide, HBL Credit Card makes
shopping fun and paying simple. So that a customer can make the most of his
shopping experience.
Benefits
Buy now, pay later
Buy what customer want, when he want and pay for it later. A credit card statement
will be sent to him every month with details of all his purchases. He will have 21
credit free days to make the payment from the statement date. Customer should pay
at least 3 days in advance if he makes your payment by cheques to allow enough
time for clearance.
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A customer can pay the entire or as little as 5% of the outstanding balance in his
statement. The unpaid amount will be transferred to his next months statement
along with applicable services charges.
Cash advance
Customer can go to any specified HBL branch and withdraw cash at the counter. He
can also go to any 1Link ATM in Pakistan and more than 1,000,000 ATMs worldwide
displaying the Visa/Plus logo. Withdraw cash up to the available cash advance limit
on his HBL Credit Card for a charge applicable from the withdrawal date.
Balance transfer facility
Card holder can pay off balances he owes to other banks through his HBL Credit
Card at a lower service charge.
Security
Card holder cannot lose cash if he doesnt carry it! In the event that his card gets
stolen/lost, he should call HBL PhoneBanking to have his card blocked immediately.
Features
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No Interest
HBL Visa Debit Card is the perfect way of paying for purchases as it gives access to
the exact amount of money a customer needed, as and when he needs it. There is
no interest or credit on payments because he spends from the money available in his
personal HBL Account.
Ease & Security
HBL Visa Debit Card offers ease and convenience because card holder doesnt have
to visit an ATM to withdraw cash. Paying with the HBL Debit card is safe because it
eliminates the need to carry cash. A single swipe automatically debits the exact
purchase amount from his personal HBL account.
Spending Limits
The daily spending limit at shops and outlets on HBL Visa Debit Card is Rs. 100,000.
(These figures are subject to the balance available in account).
Free Account Statement
HBL cardholders receive a free monthly account statement for their Debit Card and
ATM transactions to help them keep track of their spending.
International Recognition & Acceptability
HBL Visa Debit Card is accepted at over 20 million Visa merchants worldwide,
including over 10,000 merchants in Pakistan. As an ATM card it is accepted at more
than 1,000 1-Link & M-Net ATMs in Pakistan and 864,000 Visa ATMs worldwide. No
matter where card holder is, with the HBL Visa Debit Card, HBL is always with him.
No Liability
In case of a lost or stolen card, card holders are protected against fraudulent
transactions made on their card after they report the incident.
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With the rising cost of living, it is becoming increasingly difficult to make expensive
purchases or meet unexpected expenses. HBL is helping customer finance them
with Habib Bank personal Loans (old name flexi loan). Customer may avail a
personal loan of up to SIX TIMES of his net take-home salary subject to a maximum
of Rs.300,000/- provided he work for an organization approved by HBL.
Features
Flexible tenure: 12, 24, 36,48 or 60 months
No processing fee
Repayment through easy and affordable monthly installments from salary.
Credit Life & Disability Insurance
Repayment through easy and affordable monthly installments
You determine the need, we help you finance
Option of add up replacement for existing customer.
Minimum salary Rs. 12000
No salary limit for existing customers.
23% or 21% rate for existing users instead of 25%
T-PIN Generation
Customers TPIN (Telephone Personal Identification Number) is generated the first
time he calls and he can use it as your password for verification purposes, selfservice banking through IVR and additional services through HBLs PhoneBanking
Officers. Customer can change his TPIN anytime he like.
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HBL PhoneBanking services for HBL CarToCar and Car Loan customers
HBL CarToCar and HBL CarLoan customers can enjoy the following services
through HBL PhoneBanking:
Balance Inquiry
Last 5-10 Transactions
Statement Generation (Email and Fax)
Account Maintenance
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Hbl bancassurance
HBL and New Jubilee Life Insurance Company Limited (NJLI) introduce Amaan
(Retirement Plan) and Tabeer (Child Education & Marriage). These products have
been designed keeping HBLs customer base as the focus and will provide life
insurance along with an investment option.
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Lockers
Lockers are available in many of the HBL branches in different sizes like small,
medium and large; some branches also have extra large and cubical lockers. Except
rural areas because of security reasons.
Charges
Key deposit
Annual rent
(refundable)
Rs.
SMALL
2500
2750
MEDIUM
3000
3850
LARGE
4000
6050
Size
Key deposit is refundable at the time handing over the locker to bank. For the staff of
HBL key deposit is not required and also the annual rent is very low for them.
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Services
HBL provides the following services to meet customers funding requirements:
Working Capital Finance, including Overdraft, FE Loans, etc.
Pre and Post Shipment Export Financing (PKR and USD based)
Import Financing (PKR and USD based)
LMM Funding
Receivable Discounting
Islamic Banking facilities
Cash Management Services
Trade Services including Letter of Credit, Letter of Guarantee and Standby
Letter of Credit, etc.
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HBLs Commercial Banking Group targets medium sized companies with a turnover
of at least PKR 50 million. Its business units are located in Karachi, Lahore,
Faisalabad, Sialkot, Gujranwala and Peshawar. Each unit is dedicated to service
business clusters located within these cities. They have the ability and the resources
to meet the needs of customers business with their pro-active, responsive and
experienced Relationship Managers who are committed to understanding customers
business.
Services
HBL offers financing for the following:
Working Capital
Procurement of Inventory
Receivables
Procurement of Machinery
Expansion of production facilities
Import of raw materials
Exports
Guarantees
3.Saddar, Karachi
11.S.I.T.E. Karachi
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HBL ZaraiBanking facilities are spread across the country and provide financing
through more than 800 of their branches. HBLs presence in all agriculture belts of
the country ensures easy access to farmers in rural areas. HBL ZaraiBanking
provides loans to small-scale land owning farmers as well as large institutionalized
and alliance based finance, enhancing agricultural harvest and, in turn, economic
output of the country.
Products
HBL ZaraiBanking enables farmers to invest in premier quality seeds, fertilizers,
pesticides, agricultural implements and non-farm setups through its various product
programs.
Crop Inputs
Crop specific finance for purchase of Agriculture inputs such as seed, fertilizer,
pesticide and other related inputs.
Farm Implements
Finance available for purchase of farm implements & machinery like combined
harvester, sprayers, ploughs, tube wells and other crop-related tools/implements.
Tractors/Agricultural Vehicles
Finance available to individual farmers, self-employed tractor operators, providing
the option to select vehicles from a range of different manufacturers.
Livestock
Finance available for feed, medicines, raw material, raising charges and other
related activities.
Poultry
Finance
available
for
all
poultry
related
activities
including
poultry
farm
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Finance available for inland fish farms as well as deep-sea fishing. This includes
procurement of boat, fish locating equipment, nets & ropes, ice maker, fish farm
water solution, hatchery construction/equipment, purchase of medicines / feed and
other related activities.
Group Lending
Joint finance facility for a group of farmers with small land holdings for working
capital requirement.
NOTE: These finances may be availed under Demand Finance or Running Finance
categories. Demand Finance is usually available for short term financing needs while
Running Finance is available on the basis of revolving limit.
Islamic banking
Islamic Banking is a growing market segment that offers attractive opportunities to
potential and existing customers. At HBL, Islamic Banking offers Shariah compliant
products and services to meet the short and long term requirements of business,
trade and industry.
Shariah Compliance
HBLs Islamic Banking products are in strict compliance with the tenets of Shariah
and bear Shariah Compliance Certification from an independent Shariah Advisor.
Their Shariah Advisor has in depth experience in Shariah rulings (Fatawa) and
teachings at different forums with qualifications of Dars-e-Nizami, M.A and L.L.B.
HBL also have a Shariah Scholar, as member of their Shariah Supervisory
Committee to ensure a sound Shariah Compliance mechanism, giving prompt
responses to customers needs and access to Shariah knowledge.
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Diminishing Musharaka
Medium to long term facility for vehicles, plant and machinery on joint ownership
basis.
Murabaha
Local and Import facilities for purchase of raw materials, semi finished and finished
goods, stores or spares.
Trade Services
Letter of Credit Facility, Collection of Foreign Bills, Collection of Local Bills, Letter of
Guarantees.
Customers are welcome to visit their Islamic Banking branch for the following
services:
Branch
Address
Finlay House
Ground Floor
I.I Chundrigar Road
Karachi
Contact details:
021-32429304, 32429431&32
Fax
021-32429307
E-mail
hbl.5000@hbl.com
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Learning as an intern
As every body knows that "Knowledge without practice is sterile "In order to give
vent to this idea an Internship program of six to eight weeks has been arranged in
different esteemed organizations during M.B.A. In this regard on 15th of June 2009, I
was asked by Mr. Mirza Saeed (HR officer in HBL regional office Sahiwal) to go to
Habib Bank Jinnah Chowk branch to start an internship of seven weeks there.
During this period I got a chance to work and learn in following departments of the
bank:
Foreign exchange department
Bills clearing department
Credit department
I.T department
Cash department
Accounts, ATM and Lockers department
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and payment on maturity date. Opening and negotiation both are centralized process
in Habib bank therefore approval from head office is required.
Negotiation of L.C. Bank starts negotiation of letter of credit (which would be
already opened by importers bank) after the application from seller (exporter).
Before sending the documents for payment to importer bank negotiator bank must
ensure that the entire document mentioned in Claus 46A of the L.C are attached and
complete.
During the week I also worked on Remittances application. An applicant who wants
to transfer funds abroad must have a foreign currency account in the bank. Because
State Bank of Pakistan only allow account to account transfer of funds abroad
through banks. And I came to know about the process and information required to fill
the form. I also came know about the process of issuing foreign currency accounts
cheque book to customers.
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from the book in which all the signatures of authorized persons of HBL are given with
their specific code. And I also worked on OBC (Outward bank collection) forwarding
schedule. I came to know the process of sending cheques or other clearing
instruments for clearance to zonal branch of another region.
Filling vouchers
Assigning OBC numbers
Making entries in OBC register
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work on computer software that the HBL is using, how to view account information,
checking balances and updating the information.
(3) Due to my familiarity with their computer software I was given another task of
updating account information on their computer system MISYS. Like account
holders name, address, CNIC number etc. In case of any problem I was consulting it
with Mr. Asif Iqbal. This task gave me more chances to learn about the computer
system of HBL and also I can proudly say that I have my own share of working in
computerizing HBLs record.
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Financial performance
Financial Statements
Ratio analysis
The financial results for the first quarter of 2009
Financial highlights 2008
Achievements
HBL - 'The Best Emerging Market Bank in Pakistan'
2008 HBL - 'Most innovative Global Trade Finance' award
2008 - 'Best bank In Pakistan' Award
2008 HBL Milestones - 'Buzziest Brands' Awards
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2008
2007
15,614,020
10,084,037
75,180,436
63,237,429
20.76
15.94
Interpretation:
The past two years data shows an improvement in the return on equity which is a
positive sign. The Bank should have to continue its policies. By observing the
audited account I found that this improvement is due to increase in the Net profit
which is good sign.
2007
15,614,020
10,084,037
757,928,389
691,991,521
2.06
1.45
Return on Assets
Net Profit after tax X 100
Total Assets
Net Profit after tax
Total Assets
Return on Assets
Interpretation:
Return on assets ratio shows an improving trend. This ratio shows that the both the
Net profit and Total Assets has improved in 2008 than 2007. But net profit has
increased more rapidly.
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2007
456,355,507
382,172,734
757,928,389
691,991,521
60.21
55.22
Interpretation:
Loan to Asset Ratio is showing increasing trend in 2008. This is because advances
are increasing more rapidly than assets of the bank.
2008
2007
Net profit
15,614,020
10,084,037
Interest Income
43,970,884
33,250,937
35.50
30.32
Net profit /
Interest Income X 100
Interpretation:
Net profit Ratio is giving upward trend. This trend is observed due to increase in Net
profit but on the other hand the expenses decreases which shows an efficient
management.
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2007
456,355,507
382,172,734
597,090,545
531,298,127
76.43
71.93
Loan to Deposit
Loans/Deposits*100
Advances
Deposits
Interpretation:
Loans to deposit ratio show an increasing trend in 2008 as compare to 2007. This
trend is observed as the advances and deposits both are increasing but advances
are increasing more rapidly than deposits.
3,384,623
45,063
3,339,560
4.40
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Financial highlights
2008
In the following diagram HBLs balance sheets and income statements items for
2008 are compared with the items of 2007 and percentage growth is also calculated.
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Achievements
HBL - 'The Best Emerging Market Bank in Pakistan'
HBL has been selected as The Best Emerging Market Bank in Pakistan by Global
Finance Magazine.
Global Finance magazine has named the Best Emerging Market Banks in Asia in
an exclusive survey to be published in the May 2009 issue. Global Finance editors
with input from industry analysts, corporate executives and banking consultants
selected the best emerging market bank in the region and in 20 countries. Global
Finance reports on the international finance sector, covering topics such as
corporate finance, joint ventures and M&A, country profiles, capital markets, investor
relations, currencies, banking, risk management, custody, direct investment, and
money management. The magazine also holds several awards ceremonies
throughout the year to recognize the winning financial institutions and companies.
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Recommendations
As we seen from the previous analysis of the financial statements I have realized
that that Habib Bank is performing very well since its inception. It is quite difficult to
give suggestion to improve the banking conditions Habib Bank Limited. As we know
that nothing is perfect, there is always a room for improvement, so I will recommend
following suggestions for HBL:
Employees Training programmes must be introduced on continuous
basis so that Employees have understanding with the latest
developments especially with the customers.
Bank should introduced incentive plans for employees on regular basis
so that if employees may work whole heartedly for the welfare of their
organization. While giving incentives qualification, work, experience,
hard work and such other factors must be considered.
Mismanagement of resources must be avoided as much as possible as
it decreases profit but also discourage hard worker and honest
employees.
Fresh graduates must be recruited. As the combination of Experienced
and fresh can produce better results and it will improve the efficiency of
management.
Habib Bank is going towards mobile banking but the problem is that a
common client has no idea of its usage due to lack of marketing. I
think that a proper marketing programme must be launched for clients
awareness.
Banks different schemes must be conveyed to the targeted customers
so that to have a reasonable share in market.
Bank should help the society by providing interest free loans to the
Talented Students.
Online Banking should be introduced in all the branches.
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Glossary
CIIT:
D.D:
Demand Draft
A/C:
account
O.B:
Other Bank
O.B.C
P.L.S:
Dr:
debit
Cr:
Credit
C.A:
Current Account
F.L:
Flexi loan
L.G:
Letter of Guarantee
D.F:
Demand Finance
L.C:
Letter of Credit
R.F:
Running Finance
F.A.P.C:
HBL
ABL
MCB
NBP
UBL
NIFT
(pvt) LTD.
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Bibliography
Material on these books, articles and websites has helped me a lot in preparation
this report
Books
HBL Corporate Profile 2008
HBL Annual Reports 2008 and 2009 first Quarter
Websites
www.hbl.com
www.habibbankltd.com
www.hblasset.com
www.investopedia.com/articles/07/banking.asp
wiki.answers.com/Q/Evolution_of_banking
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Index
Annex A:
INTERNTSHIP CERTIFICATE
Annex B:
INDICATIVE RATES
Annex C:
ACCOUNT OPENING FORM
Annex D:
REMITTANCES APPLICATION
Annex E:
DEBIT CARD APPLICATION FORM
Annex F:
DEPOSIT SLIP