2009

FAYSAL BANK LIMITED

Internship Report

Zainab Ali Air University 2/12/2009

Faysal Bank Ltd

Internship Report

Zainab Ali

Faysal Bank Ltd

TABLE OF CONTENTS Acknowledgement ........................................................................................................................................ 5 Executive Summary .......................................................................................................................................6 Organization Overview.................................................................................................................................8 Values, Strategy and the Energized Identity ..................................................................................... 10 Board of Directors and Senior Management .................................................................................... 12 Products and Services................................................................................................................................ 14 Purpose/Objective of Internship ....17 Account Opening ..19 Cash Management 21 Clearing 22 Appendix A ..25

ACKNOWLEDGEMENT
I have many people to thank for making the internship period at FBL an extremely productive and enlightening experience while allowing me to apply my abilities in the best manner possible and providing me with an excellent working environment. I am especially grateful to Mr Shah Hussain, Mr Farhan Chishti, Mr Wasey Ullah Khan, Mr Haseeb Muhammad, Mr Raza Zaidi and Ms Anny Sadaqat. It has been a pleasure working under their guidance and tutelage.

EXECUTIVE SUMMARY
This report is the crux of my work experience as an intern at FBL from 20 th July, 2009 to 29th August, 2009. The internship encompassed basic banking functions including account opening, clearing, ATM operations, customer services etc. The experienced equipped me with basic knowledge with special emphasis on account opening, clearing and customer relations.

INTRODUCTION
Snapshot of Faysal Bank Ltd

ORGANIZATION OVERVIEW
Faysal Bank initiated operations in Pakistan in 1987, first as a branch setup of Faysal Islamic Bank of Bahrain. In 1995 it was locally incorporated as Faysal Bank Limited. Faysal Bank Ltd merged with Al Faysal Investment Bank Ltd in January 2002 resulting in a larger institution providing a diverse range of banking solutions to consumers and corporations. Faysal Bank Ltd has a branch network of over 130 branches across the four provinces of Pakistan and Azad Kashmir. Its corporate offices are present in major cities with its head office located at Shahrah-e-Faisal, Karachi. Faysal Bank has been given a credit rating of AA (double A) by JCR-VIS and PACRA for medium to long term and A-1+ (A One Plus) for the short term by the same. AA credit rating signifies high credit quality, strong protection factors and risk that is modest depending on the changing economic conditions. A-1+ denotes high certainty of timely payment, outstanding short term liquidity and safety is just a notch below Govt of Pakistans short term obligations. Ithmaar Bank B.S.C an investment bank listed in Bahrain holds 66.9% shares of FBL. Ithmaar Bank B.S.C. is licensed by the Central Bank of Bahrain and listed on the Bahrain Stock Exchange (ITHMR). It has a paid-up capital of US$360 million, total equity of US$1.1 billion and is a full investment bank with its direct business covering the Middle East and North Africa (MENA) region, as well as South Asia, Asia-Pacific and Europe. Besides holding significant investments in the

banking, financial services and real estate sectors in different markets, the main activities of the Bank include underwriting (equity and other financings), private equity (structuring, participation and portfolio
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management), Islamic financing,

private banking, and advisory services covering project financing, investments, capital markets and mergers & acquisitions. General public, NIT and other

Pakistani institutions hold remaining shares of FBL.

VALUES, STRATEGY AND THE ENERGIZED IDENTITY

FBLs brand new vision and mission are as follows; Vision: Excellence in all that we do. Mission: Achieve leadership in providing financial services in chosen markets through innovation. Faysal Bank Ltd is realigning three core areas; products and services offered by the bank, the processes adopted to deliver these products and services to consumers and the technology updates required to produce the capability for delivering them. The banks image was refreshed in 2008 to bring in a contemporary look reflecting banking in the modern era. The logo has retained the original colors of blue and grey and the octogram. These elements denote what the bank stands for; integrity, respect and professionalism. The visual in the octogram now reads Faysal to bring more relevance to the logo. The typeface in which the banks name is written has been changed to give it a more modern day look. Threshold Values: Integrity Teamwork Respect Professionalism

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Differentiator Values: Passion Responsiveness Innovation Compassion

FBL through its new vision and mission and set of values differentiates itself from competitors by striving to provide customer centric and innovative services. In fact innovation is FBLs strength and the bank is committed to anticipating customer needs and acting on a proactive basis rather than a reactive one. In 2008 FBL went from being organized regionally to one organized on a functional basis. The new functional structure supports the long term business objectives. It clarifies roles and responsibilities empowering mangers in a way that has never done before. A Strategic Development function has been developed that would guide the bank towards realization of its objectives. Other structural initiatives include instituting the Compliance Committee, setting up the Special Assets Management and Fraud Investigation units.

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BOARD OF DIRECTORS AND SENIOR MANAGEMENT

Board of Directors:
Farooq Rahmatullah Mohammad A. Rahman Bucheerel Mohamed A.R Husain Naved a. Khan Syed Naseem Ahmed Tariq Iqbal Khan Graham Roderick Walker Shahid Ahmed Director Director Director President and CEO Chairman Director Director Director

Board of Directors Committees:

Audit Committee Recruitment, Nomination and Remuneration Committee Board Risk Management Committee

Management Team:
Naved A. Khan Nauman Ansari Syed Majid Ali President and CEO Head of Corporate/Investment Banking Chief Financial Officer
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Bashir A. Shaikh Aarij Ali Mehreen Amin Taimur Afzal Nasir Islam Ahmed Kamran Masroor Ahmed Qureishi

Advisor on Special Assets/Acting Head of Risk Head of Strategic Development Head of Human Resources Head of Retail Banking Head of Compliance Head of Services Head of Treasury

Internal Committees:
MANCOM ALCO IT Steering Committee Investment Committee Compliance Committee

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PRODUCTS AND SERVICES

Faysal Bank Ltd is a commercial bank providing customers the following products and services in the Consumer, Corporate and Investment banking sectors;

Products:
Faysal Savings Account Faysal Sahulat Current Account Rozana Munafa Plus Account Basic Banking Account Muavin Savings Account Faysal Premium Faysal Izafa Term Deposit Faysal Mehfooz Sarmaya FCY Saving Plus Faysal Personal Finance Faysal Car Finance Faysal Home Finance Corporate Financing SME Financing Trade Financing Treasury and Capital Financing Investment Banking Agricultural Financing Cash Management

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Services:
Pocketmate Visa Debit Card Travelers Cheques Transfer of Funds Safe Deposit Lockers Non Stop Banking

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INTERNSHIP ACTIVITY REPORT

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PURPOSE/OBJECTIVE
Internship is usually a compulsory part of the scheme of studies and a

requirement for graduation in any field of study. The justification behind this policy is to help students apply theoretical concepts in the practical world where eventually they are destined to work. An internship experience not only tests the textbook knowledge gained from the study of different courses during a 4 year graduate program but also familiarizes the student with the inner workings of an organization and the prevalent corporate culture. Air University Islamabad in its BBA Honors Program makes it mandatory for students to gain internship experience usually in the summer after their 6 th semester of studies. The experience can hence form a solid foundation for further specialized study in the 7th and 8th semesters. The universitys placement division facilitates students in this regard and guides them when they are applying for internships in different organizations. Students most often join banks,

telecommunication companies, government organizations and other private setups. The internship usually spans a period of 6 weeks. As a student of Business Administration, I have had the opportunity of studying a diverse range of courses from Project Management to Operations Management, from Strategic Marketing to Consumer Behavior, from Human Resource

Management to Business Research Methods, from Financial Accounting to Business Finance and Commercial Banking. When provided with an opportunity to work as an intern at Faysal Bank Ltd I realized that it was time to apply what I had learned in the Commercial Banking course in a practical way. Working at Faysal Bank Ltd was an opportunity to gain valuable experience in an industry which is at its peak and experiencing a boom in Pakistan. Indeed there are now a

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countless number of banks operating in Pakistan catering to the increasing needs of consumers, large corporations, SMEs and the agricultural industry. My six week internship was based in the F-10 Branch of FBL. Being one of the busiest branches in Islamabad meant that there was a lot to learn and absorb. Every new customer posed a new issue for the employees who are dedicated individuals striving to provide prompt, innovative and reliable services. My time at FBL involved working in both Operations and Customer Relations. The banks operations are broadly broken down into the following divisions which will be further elaborated upon in the following chapters ; Account Opening Cash Management Clearing Remittance ATM operations

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ACCOUNT OPENING
The types of accounts are; Deposit accounts PLS Savings account Current Account Basic Banking Account Term Deposit Receipts (TDR) and Call Deposit Receipts (CDR) Foreign Currency Accounts

Nature of accounts; Individual account Sole Proprietorship account Joint account Partnership account Limited Companies account Local Bodies account Accounts of Executors and Administrators Account of a minor Account of Illiterate persons Account of Pardah observing ladies Account of consumers having shaky signature or signatures in Non Roman script Dormant account Accounts with balance short of minimum balance requirement Attached account/Account under Garnishee Orders/Under Lien account Blocked account Staff account
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Dividend account Account of diplomatic mission/Foreign embassies Private Non-resident Rupee account

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CASH MANAGEMENT
The objectives of Cash Management Unit (CMU) at Faysal Bank Ltd are as follows; To solicit cheap liquidity Activation of dormant accounts Enhance fee based income To add value to the cash flows of corporate clients by providing

innovative financial solutions where the bank and consumers both become partners in business. To cater to the cash management needs of existing clients and explore new markets for Banks products and services through constant innovation and engineering. Increase product base of the bank. Educate consumers and branches about efficient use of resources. Manager Operations. MANAGER OPERATIONS: Responsible for ensuring processing of transactions through coordination with Branches/Customers and ensuring compliance to agreements with customers in respect of products and services contracted. PRODUCTS AND SERVICES: Direct deposit Direct collection Indirect collection Direct debit Account Statement

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CLEARING
Clearing items are routed through NIFT by all banks in Pakistan. OUTWARD CLEARING: Counter folio pay in slip signed by an authorized officer of the branch bearing a clearance stamp should be returned to the customer for his record. Specified crossing and clearance stamp of FBL, also bearing Branch name, should be placed on the cheque. On the back of the Payee account cheque, Branch places stamp Payee Account Credited and sign by the authorized officer. After the scrutiny cheques and pay in slips will be separated, the

concerned staff will take jotting of cheques and pay in slips separately to ensure that the total of all cheques received for clearing agrees to the total of deposit slips/vouchers. Entries will be made in the Clearing House register. In case of discrepancy, the matter should be referred to the departmental Head who will take immediate steps to locate the difference. Separate clearing schedules as per for each bank/branch will be made and attached with the cheques. Jotting of schedules will be gtaken to ensure that the total reconciles with the clearing house register. Credit vouchers are processed in the system against the respective

accounts. Accounting entries are reflected on for information. Cheques sent in outward clearing when not passed by the drawee bank due to different reasons are returned back along with the return memo showing reason.

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Cheque returns are recorded in the cheque return register showing full particulars of the cheque along with the reason for return. Vouchers are passed to reverse the respective credit entry, passed in the morning and entered into the system. Client may be intimated accordingly and returned cheque should be handed over to the client under proper

acknowledgement in the register. INWARD CLEARING: These services are offered as follows: Cheques/instruments of different banks drawn on the branches of FBL are received at the concerned branches along with the schedules of other banks. Jottings of cheques and schedule are taken separately. Both jottings must tally. The officer handling/processing the inward clearing should

ensure that all cheques received bear proper clearing stamp. If for any reason cheques received in inward clearing are not honored, they will be returned with the memo showing the reason for the same. No entry/voucher will be passed in drawee branch. It is entered in outward clearing return register as the amount of IBDA issued by the main branch relating to each branch is arrived at after deducting the cheque returned by the branches. The designated officer will verify the signatures on the cheques as per signature verification limits and will also scrutinize these cheques for correctness of date/amount in words and figures etc. The incoming cheques/instruments shall be posted to the respective

accounts as per accounting entries. Cheques not paid due to insufficient balance or for any other reason will be returned to the concerned banks along with a return memo duly signed by an authorized officer.
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SAME DAY CLEARING: These services are offered as follows; Same day clearing is restricted to instruments valued at Rs 500,000/- and above, and received by 10:00 am. Same day clearing is subject to relevant charges. The depositor must make specific request to the branch for same day clearing. Same day clearing is restricted to the designated branches only, which will ensure that the timings in this respect are strictly followed.

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APPENDIX A

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