Credit Operations

1-Pre-Sanctioned (Approval) Procedures

Application for credit facilities from customer Request in writing indicating the amount of financing required, its purpose and the duration of the facility. Understanding the financial requirements of the borrower, as to adequacy of the amount, feasibility and other sources of finance Credit Appraisal It is the process by which the bank assesses the credit worthiness of the borrower. It revolves around character, collateral and capacity. Credit Investigation Report Banks own records. Other banks credit reports and information from credit rating agencies such as eCIB of state bank of Pakistan. Market Reputation

Conti
Borrowers basic fact sheet
Financial statement analysis

Interviews with the customers and visits to his place of

business.

2-Post Approval Procedures

Maintaining the record Keeping the proper record of all limits sanctioned and maintaining customer files for all borrowers Securities securities offered by the customer have been received by the bank in the form of: shares, deposits certificates and bonds etc.
Taking possession of the stock pledged of taking stock reports for stocks hypothecated. Mortgaging the landed property.

Conti..
Securities Valuation To check and monitor the value of goods pledged or in cases where the security valuation is subject to wide fluctuations such as shares. Executing Charge Documents pertaining to: Type of customer Type of advances account Security offered Completing other legal formalities, for example registration of charges in case of advances to limited companies.

3-Monitoring and follow up the credit Account

Ensuring that all the terms and conditions against which the credit is granted of complied with all the times. Periodic review of operations in accounts with: Follow up of repayment schedules Observing the extend of limits availed and portion of unutilized limits Monitor large withdrawals and deposits in the accounts to determine utilization of funds.

SWOT Analysis
Strength: Strength of the bank is that it provides loan to those customers who have already in relationship with the bank. Relationship may be the customer has already accounted with the bank. The second strength of the Bank Al Habib credit department is they provides loan which is 100% secured.

Weaknesses: Bank al Habib credit department weaknesses are the bank is not taking risk and is not market driven. As we see that in banking sector there is too much competition, and this bank is too much conservative. So be market oriented bank should take greater risk and should set it target market

Conclusion
Our visit to Bank Al Habib has provided some practical information. All the process which we have studied in the class, bank was following it. We met with bank al habib credit officer Majid Khan. He guided us in a very polite manner. Bank al habib loan is totally secured loan which they are providing to borrowers. Bank Al Habib is very efficient in its functioning they claim that they have zero non-performing loans. Bank is following conservative loan approach to make the corporate level financing and it is secured with 100% collateral further bank makes loaning to only its existing account holders.