EXECUTIVE SUMMARY

Bank plays very important role in the economy of any nation. The economic health of any country
can be checked by having a look at its banking sector. Also the banks mobilize the savings of the
people in to other projects, thus such series of further investment brings boom to the economy and
open more jobs. Askari bank establishment in Pakistan gave banking sector a new horizon. This
report is “Brief analysis of Askari Bank Limited” And our research objective is to share our
practical experience of professional life. Askari bank Established in 1991 it began its operations
in 1992 and offers a wide portfolio of services while maintaining a close link with the Armed
forces of Pakistan as it is currently owned by the Fauji Foundation and was previously owned by
the Army Welfare Trust. Askari commercial bank limited continues to scale new heights in all
areas of its operations. The safety and security of depositor’s funds, high productivity and optimum
use of technology are the hallmarks of its corporate strength.

This report starts with an introduction and from there on follows the pattern that was kindly
provided to us by our honorable institute covering the objectives, the operational details and lastly,
what I learned as an internee at Askari Bank Limited. Every internee rotated in different
departments. I got training in clearing department, accounts department, accounts opening
department and remittance department. A main portion of the report consists of my findings and
task that I have performed during my Internship and also I have observed the working of the other
people in the bank also mentioned in this report. I have done work in various departments of the
Askari bank and learn about the activities which are performed in these departments. Last portion
of my report is consist on ratio analysis, SWOT analysis, conclusion and recommendation. After
true finding, core result, I have also suggested some necessary recommendation according to my
observation. I had a great experience to learn about this new banking system and the future of this
banking is seemed to be very strong in coming years due to its increasing trend.

My report is based on my learning experiences at Askari Bank Limited and how this experience
has boosted professionalism and understanding in me. The internship program provides me the
great opportunity of being exposed to actual business, dealing, and opportunity of professional
insight which help me in future.

Pg. 1
CHAPTER # 1
INTRODUCTION
 History background
 Business philosophy
 Vision and mission statement
 Market standing

Pg. 2
1.1 HISTORY AND BACKGROUND OF ASKARI BANK
Askari Bank Ltd. (formerly Askari Commercial Bank) is a commercial and retail bank in Pakistan
and is owned by Army Welfare Trust. Askari Bank Limited (the Bank) is a Pakistan-based holding
company. The Bank is a commercial bank engaged in the business of banking. The Bank's
segments include Corporate financing, which includes corporate and investment banking
activities, such as mergers and acquisition, underwriting, privatization, securitization and
secondary private placements; Trading and Sales, which includes its treasury and money market
activities; Retail banking, which provides services to small borrowers and include loans, deposits
and other transactions with retail customers, and credit card business; Commercial Banking, which
provides services related to project finance, export finance, trade finance, leasing, lending,
guarantees, bills of exchange and deposits from corporate customers; Payment and settlement,
which includes income from payments and collections, funds transfer, clearing and settlement, and
Agency services, which includes income from rent of lockers provided to customers.

It was founded on October 9, 1991, as a Public Limited Company. On June 21, 2013 the bank
was acquired by Fauji Group. The Bank is listed on the Pakistan Stock Exchange (PSX) and was
also listed on the stock exchanges of Karachi, Lahore and Islamabad before their merger to form
the single unified Pakistan Stock Exchange (PSX). The Bank obtained business commencement
certificate on February 23rd 1992 and started operations from April 1st 1992.Army Welfare
Trust directly and indirectly holds a significant portion of the Bank's share capital at the period
end.

AKBL was founded by the Army Welfare Trust which is a charitable organization formed to cater
to the needs of widows and orphans of Army personnel. The AWT was assisted by two overseas
Pakistanis, who hold a significant stake in the bank’s equity

Askari Commercial Bank is a Scheduled Commercial Bank and is principally engaged in the
business of Banking as defined by the Banking Companies Ordinance 1962. The bank is listed on
the Karachi, Islamabad and Lahore Stock Exchange. AKBL is the only bank with its operational
Head Office in the twin cities of Rawalpindi-Islamabad,

Pg. 3
The Bank’s constitution requires the chairman to be the Adjutant General of the Pakistan Army.
Besides the chairman, the 12 directors also include the MD of the AWT (Ex-Army), four other
retired senior army officers and two overseas sponsors. Army appointed directors do not influence
the daily operations of the bank as their presence is intended to provide a general policy
framework. The remaining top management of the bank is sourced out from other Pakistani and
foreign banks operating in the country.

Askari Bank is the only bank with its operational head office in the twin cities of Rawalpindi-
Islamabad, which have relatively limited opportunities as compared to Karachi and Lahore. This
created its own challenges and opportunities, and forced as to evolve an outward-looking strategy
in terms of Askari market emphasis. As a result, Askari developed a geographically diversified
assets base instead of a concentration and heavy reliance on business in the major commercial
centers of Karachi and Lahore, where most other banks have their operational Head offices.

Bank connected online customers supported with network of ATMs. Over the years, Askari Bank
has proven its strength as leading banking sector entity with ever-increasing commitments to its
customers, through strategic investment in electronic technology. Askari Bank achieved the
following firsts in Pakistani Banking.

1. The first Pakistani Bank to offer online real-time banking on country wide basis.
2. The first Pakistani bank with nation-wide network of ATMs.
3. The first bank in Pakistan, foreign or local, to introduce internet banking in the country.
4. The first bank in Pakistan, together with ABN-Amro bank, to develop inter-bank switch
for the ATMs.

AWARDS AND ACHIEVEMNTS:

 The Asian Banker awarded twice as “Best Retail Bank in Pakistan” in 2004 and 2005.
 Askari Bank also has been given the “Best Consumer Internet Bank” award by Global
Finance magazine for the years 2002 and 2003.

Pg. 4
  Askari bank has been given the “1st Consumer Choice Award” 2004 for the commercial
banking category by the consumer association of Pakistan.
 The bank has also received the “Corporate Excellence Award” for the financial sector
from the Management Association of Pakistan (MAP) for the years 2002, 2003 and 2004.
 “The Best Annual Report Award for the year 2012 – 2nd Runner-up“ by ICAP & ICMAP
 “The Best Annual Report Award for the year 2011“ by ICAP & ICMAP
 “Best Presented Annual Report Award and SAARC Anniversary Awards for
Corporate Governance Disclosures 2011” by South Asian Federation of Accountants
 “The Best Bank in Pakistan” by Global Finance magazine – 2001 and 2002
 “Euro money and Asia money Awards” – 1994, 1996 and 1997
 “Best Presented Annual Accounts” by (ICAP) and (ICAMP) – 2000, 2001 and 2002
 “The Best Presented Annual Accounts” by South Asian Federation of Accountants
(SAFA), in the SAARC region
 “The Best Consumer Banking Award 2006” by the Consumer Association of Pakistan
– 2007
 “The Best Retail Banking Award 2008” by Pakistan Guarantee Export Corporation Ltd
– 2008

 “Best Corporate Report Award for the year 2008″ by ICAP & ICMAP – 2008

 “The Best Annual Report Award for the year 2010″ by ICAP & ICMAP

 “The Best Presented Accounts Award 2010 – 2nd Runner Up-Joint” by South Asian
Federation of Accountants

1.2 BUSINESS PHILOSOPHY:

There are business philosophy of AKBL:

Our Customers:

Knowing our customer and their needs is the key to our business success. Our products and
services are as diverse as our market segments. Our client relationship managers are well equipped

Pg. 5
and well trained to provide the most efficient and personalized service to the customers. Askari
bank is proud of its pioneering role in providing the most modern and technologically advanced
services.

Our investors:

AKBL believe that the bottom line of any business is creating shareholder value. To gain their
trust and confidence, AKBL believe in providing our investors timely, regular and reliable
information on our activities, structure, financial situation and performance.

Our Regulators:

AKBL firmly believe in regulatory discipline and harmony of our corporate objectives with
regulatory framework. Our business methodologies are designed to ensure compliance with the
directives of all our regulators.

Our Employees:

AKBL strongly believe that the interests of the Bank and the employees are inseparable. AKBL
try to create a “we” culture where there is mutual trust and respect of each other. Askari bank
encourage ownership behavior so that everyone feels responsible for the performance and
reputation of the Bank. AKBL are committed to develop and enhance each employee’s skills and
capabilities through extensive in-house and external training programs and job rotations. In order
to ensure meritocracy, our appraisal system is purely performance based.

OUR COMMUNITIES:

AKBL fully recognize our corporate social responsibility and our contributions to different areas
of the social sector are aimed to help improve the quality of life in our Country.

CODE OF BUSINESS PRINCIPLES:

 Deliver solutions that meet customer’s financial need.
 Build and sustain a high performance culture.
 Build trusted relationships with all shareholders.

Pg. 6
  Build and manage the bank’s portfolio of businesses to achieve strong and sustainable
shareholder returns.
 Create and leverage strategic assets and capabilities for competitive advantage.

CORPORATE OBJECTIVES OF AKBL

 It will endure to provide its customers with as many creative financial services and
products, as is required. As today customer demands a package of services suited to his
particular business, Askari plans to develop different and new products to cater to the
customer's demand. Askari bank has the strength to be a market leader.
 To achieve sustained growth and profitability in all areas of business.
 To build and sustain a high performance culture, with a continuous improvement focus.
 To develop a customer service oriented culture with special emphasis on customer care and
convenience.
 To build an enabling environment, where employees are motivated to contribute to their
full potential.
 To maximize use of technology to ensure cost effective operations, efficient management
information system, enhanced delivery capability and high service standards.
 To manage the Bank’s portfolio of businesses to achieve strong and sustainable shareholder
returns and to continuously build shareholder value.
 To deliver timely solutions that best meet the customers‟ financial needs.
 Askari is committed to its identity of “security & trust” and will endure to uphold this
image at all the times.

1.3 VISION & MISSION STATEMENT

VISION
“To be the bank of first choice in the region.”

Pg. 7
 MISSION STATEMENT
“To be the leading private sector bank in Pakistan with an international presence,
delivering quality service through innovative technology and effective human resource
management in a modern and progressive organizational culture of meritocracy,
maintaining high ethical and professional standards, while providing enhanced value to all
our stake-holders, and contributing to society.”

CORE VALUES:
AKBL focuses its operations on the core values that it terms as:

1. Commitment:

Passionate about our customer’s success and delighting them with the quality of our service

2. Integrity:

A distinctive investment, delivering outstanding performance, return and value.

3. Fairness:

Exemplary compliance, governess and business ethics.

4. Teamwork:

Caring for our people and helping them to grow.

5. Service:

Dedication towards social developments and improvements in quality of life.

The vision statements and mission statements and the core values are relayed to every new
individual that joins the organization and it is made sure that they comply by them no matter
whatever the situation and never forget these because the customer is the primary focus.

Pg. 8
1.4 MARKET STANDING:

JCR-VIS Credit Rating Co. Ltd. (JCR-VIS), approved by Securities & Exchange Commission of
Pakistan and State Bank of Pakistan, is operating as a ‘Full Service’ rating agency providing
independent rating services in Pakistan. JCR-VIS is a joint venture between Japan Credit Rating
Agency, Ltd. (JCR) - Japan's premier rating agency, Vital Information Services (Pvt.) Limited
(VIS) – Pakistan’s only independent financial research organization, Karachi Stock Exchange and
Islamabad Stock Exchange.

As per the technical agreement with JCR, JCR-VIS may seek JCR’s assistance on any conceptual
and methodology related matter. However, JCR is not represented on the rating committee and
JCR-VIS does not seek JCR’s opinion on individual ratings.

In January 2001 JCR and VIS entered into a Joint Venture Agreement whereby JCR acquired
15% share in DCR-VIS Credit Rating Co. Ltd. of Pakistan. As a result of this agreement, the name
of the company changed from DCR-VIS Credit Rating Co. Ltd. to JCR-VIS Credit Rating Co. Ltd.
(JCR-VIS). The DCR-VIS Credit Rating Co. Ltd. was incorporated in 1997 as a joint venture
between VIS, Pakistan Stock Exchange Limited (PSX), ISE Towers RIET Management Company
Ltd (ISE) and Duff & Phelps Credit Rating Co. (DCR). Subsequent to DCR’s merger with Fitch
IBCA, DCR sold its interests in DCR-VIS to VIS.

The ratings assigned by JCR-VIS to AKBL is AA- and the Askari bank is stable and reaffirmed.
The ratings assigned to AKBL take into account its association with Fauji Foundation, a large
conglomerate operating across diversified sectors of the country. Pursuing an aggressive branch
expansion plan, the bank aims to increase its footprint to 500 locations by end-FY16. To protect
profitability in low interest rate regime, the bank plans to increase financing in high yielding assets
and pursue aggressive growth in low cost deposits. Moreover, profitability may get impetus from
provisioning reversal in case of already classified accounts.

In line with banking sector trends, AKBL’s asset deployment strategy remained conservative with
focus on maintaining credit quality of the advances portfolio. Within corporate portfolio, focus
remained on mid-tier corporate customers to manage overall yields on the portfolio. Asset quality
Pg. 9
indicators have exhibited improvement in line with growth in lending portfolio. Changes in
distribution strategy are expected to facilitate growth in consumer assets; maintaining a check on
the related asset quality indicators will remain important.

Overall liquidity profile of the bank remains strong underpinned by largely maintained liquid
assets in relation to total deposits and borrowings, improved granularity of deposits and higher
share of CASA in deposit base. Core earning depicted healthy growth during the outgoing year on
account of volumetric growth in earning assets while lower cost of funds positively reflected on
the spreads of the institution. Capitalization indicators of the bank were largely sustained. Net
NPLs to Tier-1 capital improved on a timeline basis however continue to be higher in comparison
to most of the peer banks. Increase in tier-1 equity may be warranted to ease pressure on
capitalization indicators as regulatory requirements increase. Moreover, higher profit retention will
assist the bank in facilitation of future growth in advances portfolio as PIBs and interest rate
scenario reverse.

Pg. 10
CHAPTER # 2
MANAGEMENT SYSTEM
 Organizational chart
 Corporate profile
 Management hierarchy
 Policy formation process
 Managerial policies
 Credit rating

Pg. 11
2.1. ORGANIZATIONAL CHART:

BOARD DIRECTORS

BOARD AUDIT & BOARD HUMAN

COMPLIANCE RESOURCE
BOARD RISK BOARD INFORMATION
MANAGEMENT TECHNOLOGY
COMMITTEE OMMITTEE

PRESIDENT& CHEIF EXECUTIVE

GROUP HEAD- CORPORATE

GLOBAL TREASURER
& INVESTMENT BANKING

GROUP HEAD - CHIEF FINANCIAL

OPERATIONS OFFICER

GROUP HEADE- BRANCH COUNTRY HEAD-

BANKING ISLAMIC BANKING

CHIEF INTERNAL CHIEF INFROMATION

OFFICER OFFICER

COUNTRY HEAD- COUNTRY HEAD- RISK

COMPLIANCE DATA MANAGEMENT

COUNTRY HEAD- HUMAN COUNTRY HEAD- CREDIT

RESOURCE

COMPANY SECRETARY

Pg. 12
 ORGANIZATIONAL STRUCTURE

BRANCH
OPERATION MANAGER
MANAGER
CREDIT
OFFICER

A/C & IT
DEPARTMENT

OPERATION
INCHARGE

ACCOUNT
OPENING

CD
INCHARGE

BDO F.T. OFFICER

CLEARING
OFFICERS
OFFICER

Pg. 13
2.2. CORPORATE PROFILE:

BOARD OF DIRECTORS

Lt Gen Syed Tariq Nadeem Gilani, HI (M) (Retd) (Non-Executive Director)

Chairman - Non-Executive Director

Lt Gen Shafqaat Ahmed, HI (M) (Retd)

Lt Gen Javed Iqbal, HI (M) (Retd)

Dr. Nadeem Inayat

Mr. Kamal A. Chinoy

Justice (R) Sarmad Jalal Osmany

Syed Ahmed Iqbal Ashraf

Mr. Mushtaq Malik

Syed M. Husaini (Executive Director)

BOARD COMMITTEES

AUDIT

Syed Ahmed Iqbal Ashraf - Chairman

Mr. Qaiser Javed

Dr. Nadeem Inayat

Mr. Manzoor Ahmed

HUMAN RESOURCE & REMUNERATION

Lt Gen Shafqaat Ahmed, HI (M) (Retd) - Chairman

Dr. Nadeem Inayat

Pg. 14
Syed Ahmed Iqbal Ashraf

Mr. Mushtaq Malik

RISK MANAGEMENT

Mr. Manzoor Ahmed - Chairman

Mr. Qaiser Javed

Justice (Retd) Sarmad Jalal Osmany

Syed M. Husaini

SHARIAH BOARD

Mufti Muhammad Zahid - Chairman

Mufti Ismatullah - Member

Dr. Muhammad Tahir Mansoori - Resident Shariah Board Member

AUDITORS

M/s A. F. Ferguson & Co. Chartered Accountants

LEGAL ADVISORS

M/s RIAA, Barker Gillette

Advocates & Corporate Counsellors

COMPANY SECRETARY

Mr. Umar Shahzad

REGISTERED OFFICE

AWT Plaza, the Mall, P. O. Box No. 1084 Rawalpindi - 46000, Pakistan

Tel: (92 51) 8092624

UAN: (92 51) 111 000 787, Fax: (92 51) 2857448

Email: ir@askaribank.com.pk

Pg. 15
WEBSITE

www.akbl.com.pk

2.3. MANAGEMENT HIERARCHY:

PRESIDENT

SENIOR EXECUTIVE VICE

PRESIDENT

SENIOR VICE PRESIDENT

VICE PRESIDENT

ASSISTANT VICE
PRESIDENT

GRADE - I

GRADE - II

GRADE - III

ASSISTANT, CASHIER ETC

NON CLERICAL STAFF

Pg. 16
2.4. POLICY FORMATION PROCESS:

Executive Summary

Define the Features

Do the virtual testing

Remove flaws (if any)

Approved by board of directors

This is the chart of policy formation process. In this chart, this show the process of policy
formation, how the bank policies can be made. The first step is executive summary, bank define
new policy in summary form. Then second step is define the features, bank define the features of
policy and also tell that why this policy is necessary for the bank. The third step is do the virtual
testing, bank test policy to see the results of the policy. AKBL see that this policy is give the right
results that want, is this working well according to the need. The fourth step is remove flaws, in
this step if policy have any flaws then AKBL remove these flaws. These flaws are not necessary
in the policy. Then last step is approved by board of directors, AKBL approved policy from board

Pg. 17
of directors. The board of directors saw every clause and result that bank achieve through this
policy. When AKBL get approval from board of directors then introduce this policy in a bank.

2.5. MANAGERIAL POLICY:

There are some managerial policies of AKBL:

1. Financial policies
2. Procurement policies
3. Marketing policies
4. Promotional policies
5. Lending policies
6. Personal policies

FINANCIAL POLICIES

The financial policies of any bank are the most important policies through which the whole
banking activity is conducted. These policies are primarily conducted on:

 Source of funds
 Use of funds

SOURCE OF FUNDS

The bank finance policy is acquiring funds from the following sources:

 Deposits of account holders.

 Interest on advances and loans granted to the borrowers.
 Income and commission from the services provided by the bank.
 Bank open various types of accounts for its customers Services are provided for earning.
 Interest income and commission bank providing the services to its customer.

Pg. 18
USE OF FUNDS

After the acquisition of the funds their acquisition become necessary. The bank seeks the best way
for making investment to get more profit with the maximum security. The bank has an investment
portfolio in which it allocate its funds for crediting to borrowers, investment in the stock market,
investment in the real estate property etc. for allocation of funds a bank has to follow some banking
policies and the prudential regulations of SBP these are: A bank has to maintain a liquidity with
central bank, i.e. 25 %of its total deposits. A bank cannot invest all of its funds otherwise it will
be difficult to meet urgent needs. A substantial part of funds is received from interest on loans and
advances. Before granting a loan the bank analyze and observe the borrower and conduct a
complete ratio analysis. Bank prepare credit line for this purpose the major thing is granting an
advance is the security offered by the borrower and its actual market value.

PROCUREMENT POLICIES

Procurement policies are more concerned with manufacturing organizations. In bank industry that
is service industry procurement means the procurement of funds from various sources such as
deposits. It involves attracting and holding the funds of the depositors. After the acquisition of
funds, the bank invest the acquire funds. One alternative is to lend its money and earned interest
markup or invest in govt. securities etc. as already mentioned in the above paragraph the major
sources of funds for a bank are the deposit of the general and the other sources of income includes
interest or markup charges received for various services offered by the bank to its clients. A bank
tries to attract maximum no. Of accounts so that it can increase its deposits and these lending
ability. In order to get maximum no. of accounts the staff of the bank must be efficient as compared
to the other banks and the manager of the branch must take personal interest in attracting deposits.
Good quality of the service is the key to success.

Pg. 19
MARKETING POLICIES

Marketing policies are also one of the most important policies because they are related to the
growth of the organization. Marketing for a bank would mean:

1. Creation of new product and services.

2. The bank marketing must be consumer oriented.

Following are the marketing policies of the AKBL.

 Keeping the track of latest development in the world and incorporating the latest and most
modern equipment to make the banking procedures simple and easy for the customers.
 Development of products for the customers.
 Giving good services and maintaining good relations with the customers.

These policies can be implemented by providing the right product and service to the customer at
the right place, at the right time, at the right price. It is necessary for the managers to keep in touch
with consumers, observe their needs and develop products, which meet their needs.

PROMOTIONAL POLICIES

Public relation and advertising has assumed a great importance in the modern banking business.
As for as promotional activities are concerned, the main objective of the bank is to inform the
existing clients and other people about its new products or change in the existing services. AKBL
establishes its purpose through:

1. Direct contact with customers.

2. Relation with business organizations.
3. Community relations.

Pg. 20
LENDING POLICIES

Every bank has its own lending policies except for those, which are common for all the banks, i.e.
the policies, which are imposed on all the commercial banks by the SBP, are known as prudential
regulations. The lending policies of AKBL are as follows:

1. The bank only invests in those sound and viable projects, which have good rate of return.
2. Bank prefers to advance loan to their account holders.
3. Loan is given to reliable person only.
4. No political loan is sanctioned by bank.5.
5. Any account holder can apply for running finance or demand finance. The manger apprises
the past record of accountholder and his credit worthiness. If he finds anything wrong he
can refuse to sanction the amount.6.
6. The bank while taking security prefers govt. Securities toshares.7.
7. It also advances working capital loans.

PERSONAL POLICIES

Personal policies have an important role in the success of any organization. AKBL have its proper
personal policies. Good personal policies motivate the employees towards hardworking. Following
are the main personal policies of AKBL:

1. Selection of employees on merit.

2. Selection of capable employees.
3. Attractive salary package for motivation of employees.
4. To train and develop the future management of the bank.
5. Every employee must have certain set of clearly defined duties.
6. Effective communication at all levels of the organization.

Pg. 21
 2.6. CREDIT RATING:

The credit rating is assigned by PACRA. The Pakistan Credit Rating Agency (PACRA) as given
in Annual Report 2017 maintained both AKBL long term and short term ratings at “AA” and
“A1+”. The rating specifies a very high credit quality and very strong capacity for timely payment
of financial commitments.

The rating reflect relative positioning of bank, driven by AKBL strong ownership structure
whereby Fauji Foundation Group – an established business conglomerate with strong financial
muscle – holds majority stake. The bank has continued the growth trajectory in 2016, more aligned
with the industry trend. The cost of funding has been rationalized due to healthy growth in low
cost deposits wherein, added granularity has reduced concentration level. Volumetric increases in
earning assets.

Pg. 22
CHAPTER # 3
MARKETING MIX
 Product
 Price
 Place
 Promotion
 Publicity

MARKETING MIX

Pg. 23
Most companies use the term marketing mix to describe the combination of elements that they use
to achieve goals for selling and promoting their products and services. When the company decides
which elements it will use, it calls that particular marketing mix its marketing strategy.

The major marketing management decisions can be classified in one of the following four
categories:

 Product => physical item/service provided by bank

 Price => commission received

 Place (distribution)=> placement of product/service

 Promotion => means of spreading the words about the product/service

These variables are known as the marketing mix or the 4 P's of marketing. They are the variables
that marketing managers can control in order to best satisfy customers in the target market.

Pg. 24
 3.1. PRODUCT:

Askari bank offer two types of product.

1. Deposit products
2. Consumer products

DEPOSIT PRODUCTS:

Firstly, discuss the deposit products of AKBL.

1. Askari Bachat Account

2. Value Plus Current Account
3. Askari Assan Account
4. Current Deposit Account
5. Basic Bank Account
6. Askari Special Deposit Account
7. Profit Loss Sharing (PLS) Saving Account
8. Askari Little Champs Account
9. Askari Waqaar Account
10. Rupee Traveler Cheques

1. ASKARI BACHAT ACCOUNT

Askari Mahana Bachat Account is a term deposit product for individual and corporate customers
with a medium term investment appetite. It offers individual customers the option of investing for
one and two years tenures, while corporate customers can invest for two years. It is designed to
cater to the saving needs of customers who want profit on a monthly basis with the option of
availing financing facility of up to 90% of the principal amount.

Balance Requirement: Minimum balance of Rs. 50,000/- with no upper limit

Tenure: 1 year, 2 years

Pg. 25
Profit Payment: Monthly 1st of every month

Expected Rate of Return: 6.50% per annum 7.10% per annum

Financing Limits: Up to 90% of the principal amount

Free Facilities: – Visa Debit Card (For CASA account)

 No issuance fee
 SMS alerts on ATM cash withdrawal and Internet Banking transaction

– Insurance Coverage

ATM cash withdrawal insurance coverage up to daily cash withdrawal limit of the debit card from
Askari Bank ATMs.

24 hours world-wide Accidental Death & Permanent Disability insurance coverage to Debit Card.

 Online fund transfer facility

 Internet banking facility
 Issuance of cheque books
 Duplicate account statements
 Pay orders / Demand draft

2. VALUE PLUS CURRENT ACCOUNT

Askari Value plus Current Account offers financial freedom and security with unmatched
flexibility. Customers (individuals) can open this account to avail the benefits of free life insurance
coverage of up to Rs.2 Million, debit card with two supplementary cards, I-Net facility, SMS alerts,
issuance of cheque books and bankers’ cheques – all with no minimum balance requirements.
Value plus Current (Business Account) is specially designed to cater to the diversified needs of
business community.

Features Details
Opening Balance Requirements: None

Pg. 26
 Minimum Monthly Average Balance None
Requirements:
Free Facilities Issuance of Pay Orders / Demand Drafts
1. Allocation of Lockers (subject to availability)
refundable key deposit required as per SOC
2. Issuance of duplicate account statements
Issuance of Visa Debit Card (annual and
replacement fee would apply)

ATM Cash Withdrawal Insurance coverage up

to daily cash withdrawal limit of the debit card
from Askari Bank ATMs

24 hours world-wide “Accidental Death &

Permanent Disability” insurance coverage to
Debit Card / Visa Debit Card holders. Rs.
500,000/- and Rs. 700,000/- for Classic and
Gold Visa Debit Cards respectively

On-line fund transfer facility

Internet Banking facility

SMS Alerts on Visa Debit Card, Internet

Banking and Call Center transactions.

Issuance of Cheque Books

3. ASKARI ASAAN ACCOUNT

Askari Bank offers Asaan Account to unbanked / under-banked individuals. The facility is
available in current and savings account categories. As per the name of this product, its hassle-free
account opening and operating procedure helps the lower income groups to fulfill their banking
requirements with ease and comfort.

Pg. 27
FEATURES:

1. Offered in current & savings account 2. SMS Alerts, E-statements, I-Net

categories in Pak Rupee banking and Mobile Banking is
provided.

3. Account opening with Rs.100/- 4. Transaction limit is Rs.500, 000/- for

total credit balance and total debit per
month.

5. No minimum balance requirement 6. Cross border (outward) transactions

shall not be allowed except in case of
international transactions carried out
through debit cards.

7. Bi-annual account statement 8. Customers can place their funds in

Bank’s prescribed TDR products.
However, the maximum credit balance
limit will be inclusive of funds placed
in TDRs.

9. No service charges for account opening 10. Free PayPak Debit Card issuance
& closing (subsequent charges apply as per the
prevailing Schedule of Charges)

4. CURRENT DEPOSIT ACCOUNT (CDA)

CDAs can be opened by individuals (either singly or jointly), proprietorship concerns, partnership
firms, public and private limited companies (including guarantee limited & single member
companies) government organizations, corporations, clubs, societies, associations,
NGOs/NPOs/charitable organizations etc. It can be opened in Pak rupees as well as in foreign
currencies.

Pg. 28
 Features (Pak rupee account) Features (foreign currency account)

 Minimum account opening deposit of  Can be opened in USD, GBP, EUR,

Rs.5,000 JPY & AED

 No minimum balance requirement  Minimum account opening deposit of

US$500 or equivalent

 Visa Debit card& I-Net banking  Account closing charges apply as per
Schedule of Charges

5. BASIC BANKING ACCOUNT (BBA)

A BBA specifically caters to the banking needs of students, pensioners and salary account of
individuals with low incomes. BBA can be opened in Pak rupees only.

Eligibility

A BBA can be opened by individuals belonging to the following categories:

 Low income salaried individuals

 Pensioners
 Students

FEATURES

1. Minimum account opening deposit of 2. Two free cheque withdrawals per

Rs.1, 000. month.

3. No minimum balance requirement. 4. BBA customers are facilitated and

However, BBA which remains open encouraged to convert their account to
with zero balance for a period of six Askari AAsan Account or regular
consecutive months will be closed. current/savings account

5. No maintenance fee 6. Unlimited free ATM withdrawals

Pg. 29
 7. Two free over-the-counter deposit 8. Annual statements of account
transactions per month

6. ASKARI SPECIAL DEPOSIT ACCOUNT (ASDA)

ASDA is well suited to the requirements of customers who require undertaking frequent deposit
and withdrawal transactions in their accounts.

Eligibility

ASDA can be opened by individuals (either singly or jointly), proprietorship concerns, partnership
firms, public and private limited companies (including guarantee limited & single member
companies), government organizations, corporations, clubs, societies, associations,
NGOs/NPOs/charitable organizations etc.

FEATURES

1. No minimum opening balance 2. No minimum balance maintenance

requirement requirement

3. Profit calculated on the average 4. Profit payments are subject to

monthly balance of the account and deduction of withholding tax as per
credited to the account on the first of government rules
every calendar month

7. PROFIT AND LOSS SHARING (PLS) SAVINGS ACCOUNT

PLS savings account is characterized by the fact that profit is payable on monthly average credit
balance held in the account.

Eligibility

PLS savings accounts can be opened by individuals (either singly or jointly), proprietorship
concerns, partnership firms, public and private limited companies (including guarantee limited &

Pg. 30
single member companies) government organizations, corporations, clubs, societies, associations,
NGOs/NPOs/charitable organizations etc.

Features (Pak rupee account)

 Account opening deposit of Rs.100. However, there is no account opening deposit

requirement for customers falling under following categories:
 Mustahkeen of Zakat
 Students
 Government employees or those employed by semi-government institutions, and recipients
of family pension/benevolent fund grant etc., for opening accounts for salary and pension
purpose.
 Visa Debit card
 I-Net banking
 Profit paid on a biannual basis based on the average monthly balance of the account
 Profit payments are subject to deduction of withholding tax as per government rules.

Features (foreign currency account)

 Opened in USD, GBP, EUR, JPY & AED

 Minimum account opening deposit of US$500 or equivalent
 Not subject to deduction of Zakat
 Profit payments are subject to deduction of withholding tax as per government rules.

8. ASKARI LITTLE CHAMPS ACCOUNT

Askari Little Champs Account is designed specifically for minors (individuals below the age of 18
years). It introduces the concept of saving to the children and helps them understand the value of
money at an early age. The account offers two variants i.e. current and savings accounts. Little
Champs Account comes with a money box as a welcome gift, along with a Visa Debit Card and
cheque book. It offers high returns, free education insurance plan and surprise gifts on birthday.

Pg. 31
Avail the Perks

 Minimum initial deposit of Rs.100

 Free first cheque book
 Free debit card (annual/replacement fees apply). This debit card has the following limits:
 Daily funds Transfer Limit: Rs.100,000
 Daily ATM Withdrawal Limit: Rs.25,000
 Daily POS Limit: Rs.50,000
 SMS alert service
 I.net banking services
 Free education insurance plan – Rs.5, 000 per month for 5 years on savings account &
Rs.10,000 per month for 5 years on current account in case of death of guardian

You’re Education, Our Priority

By becoming a Little Champ, the children automatically get registered for free education insurance
plan, so that the studies are taken care of even in hard times.

Little Champs Free Education Insurance offers Rs.5, 000 per month for 5 years on a savings
account and Rs.10, 000 per month for 5 years on a current account, in case of guardian’s death.

9. ASKARI WAQAAR ACCOUNT

Askari Waqaar Account caters to the banking needs of senior citizens (55 years and above) looking
for monthly profits, high returns and short term investment opportunities. Askari Waqaar Account
offers two variants; Term deposit (one year) and Savings account. The customer has the option to
choose any or both of these variants.

 High returns
 Offered in Savings/Term Deposit categories
 Profit paid on monthly basis
 Free first debit card

Pg. 32
  Free first cheque book

Features Savings Term Deposit

Tenure - 1 year

Minimum Age to qualify 55 years 55 years

Profit Calculation Monthly Average Balance -

Profit Payment frequency Monthly Monthly

Debit Card & Cheque Book Free for the first time Free for the first time – for
(subsequent annual and linked account (subsequent
replacement charges will annual and replacement
apply) charges will apply)

10.RUPEE TRAVELER CHEQUES

Askari Bank offers its customers the widely accepted Rupee Traveler Cheque, which eliminates
all financial risks while travelling. It is a safe and secure way to make payments.

Features Details

Eligibility: Any literate individual customer (account is

not mandatory)

Denominations: Rs. 10,000/-

Validity: Until encashed

Processing 1. Issuance
 Desirous customer will submit the
application form (duly filled/signed) at
any branch of Askari Bank Limited.

Pg. 33
  After verification, branch will forward
the form to the Investment Products
Unit (IPU)
 IPU will keep the record of the
customer and system will
automatically update that customer’s
transaction.
2. Encashment
 Original purchaser will approach the
nearest branch
 Purchaser will sign RTC on the face
and branch will verify his signatures
with the signature mentioned on CNIC
before encashment of the same

Charges:  Refund processing charges are Rs.

1,000/- and issuance/encashment are
free

Commission:  Rs. 30 per RTC on holding the same for

30 days or more

Withholding Tax  0.3% on Issuance & Encashment in

excess of Rs. 50,000/-

CONSUMER PRODUCTS:

Now discuss the consumer products that are provided by AKBL:

1. ASK4CAR
2. Personal Finance
3. Master Credit Card

Pg. 34
 4. Askari World MasterCard Credit Card
5. Mortgage Finance

1. ASK4CAR

Askari Ask4Car is an auto financing product for new, used and imported vehicles. It offers
competitive mark-up, flexible repayment plan and quick processing without any hidden costs. The
product is offered to the customers for a maximum tenure of 7 years.

Features Details

Product Type: Financing for new, used and imported

vehicles

Charges: As per prevailing “Schedule of Bank

Charges“

Insurance: Built in Insurance & Tracker

Equity Requirement:  New vehicles: minimum 20%

 Imported vehicles: minimum 30% of
the FSV of the vehicle
 Used vehicles: minimum 30% of the
FSV

Co-borrower: Parents, spouse and son can be considered as

Electronics Credit Information Bureau
(ECIB) & Debt Burden Ratio (DBR):
co-borrower. Brother/ sister can be considered
if other options are not available and provided
they are employed/self-employed
 Mandatory for all applicants including co-
borrowers

Pg. 35
  Debt burden inclusive of all existing and
proposed liabilities shall not exceed 50%
of net disposable income

2. PERSONAL FINANCE

With unmatched financing features in terms of loan amount, payback period and easy monthly
installments, Askari Bank’s Personal Finance makes sure that customers get the most out of their
loans. The product tenure ranges from 1 – 5 years and is designed primarily for salaried individuals

Features Details
Loan Amount:  Minimum: Rs. 50,000/-

 Maximum: Upton Rs. 2,000,000/- (subject to

terms & conditions)

Age: 21 – 60 years (maturity of loan at 60 years)

Tenure:
Electronics Credit Information Bureau
(ECIB) & Debit Burden Ratio (DBR):
Processing/Others Charges:
21 – 65 years, SEP/SEB/Pensioners (maturity
of loan at 65 years)
1 – 5 years
Mandatory for all applicants. Debt burden
inclusive of all existing and proposed
liabilities shall not exceed 50% of net
disposable income
As per prevailing “Schedule of Bank Charges

Askari bank provide different services to fulfill their customer need. They provide their services
with an ease and convenience to the customer. Now discuss the services that Askari bank provide
to customer.

Pg. 36
 3. MASTER CREDIT CARD

Askari Bank offers a competitive suite of Classic, Gold, Corporate and Platinum Master Credit
Cards that provide superior services, travel privileges, exciting discounts, and online payment
facility along with reward points and transactional alerts through SMS as an enhanced security
feature. The option for Flexible Credit Plans (FCP), Extended Payment Plan (EPP) and Balance
Transfer is also available to customers at discounted mark-up rates.

4. ASKARI WORLD MASTERCARD CREDIT CARD

AKBL is known as an initiative-taking institute and keeping alive the old tradition, AKBL has
again come up with the unique product introduction in the local card market. AKBL is the first
bank in Pakistan to launch “Askari WORLD MasterCard Credit Card” under the umbrella of
MasterCard. This high-class card is designed to let AKBL cardholders experience a higher level
of convenience, security, control and privileges with a suite of premier benefits.

World MasterCard is a unique and profiled credit card, which allows ultimate and marvelous
benefits to its cardholders across the globe, primarily high profiled customers, i.e. CEOs, MDs and
Corporate Executives. It is an exceptional experience that opens the doors to an array of valuable
offers, upgrades, distinctive deals and preferred access of high lifestyle and amazing deals on
international travel.

 Travel In Style with Askari World MasterCard

 Luxurious Shopping Experience with Askari World MasterCard

 Peaceful Travel Experience with Askari World MasterCard

5. MORTGAGE FINANCE

Build a Home:

This type of loan is extended to customers who already own a piece of land and need funds to meet
cost of constructing of house on that land. The disbursement of this loan is made in tranches during

Pg. 37
the construction phase depending upon the Bills of Quantity (BOQ) submitted by the customer
duly verified by Bank’s approved valuation agency.

Buy a Home:

As the name suggests, this type of loan is meant for the purchase of an already constructed house.

Buy a Plot and Construct:

This loan type is extended for the customers who want to buy a plot and construct a house on that
plot.

Renovation:

This loan is offered to customers who already own a house and require funds for
renovation/improvement. Disbursement will be made in two tranches only after customer has
provided BOQ duly verified by Bank’s approved valuation agency.

Balance transfer facility:

This kind of loan is offered to existing borrowers of other institutions, who may want to switch
over to Askari Bank Limited because of service, pricing or relationship reasons. The Mortgage
loan with the other financial institute should be with positive credit history. Balance transfer
facility is strictly not allowed for properties that are still under construction.

CORPORATE BANKING

Corporate Banking works on a long-term relationship based business model to provide a single
point within the Bank or meeting all business requirements of its corporate and institutional
customers, including public sector enterprises, with the primary objective of enhancing customer
service. Dedicated relationship managers for each of our corporate client ensure customer
satisfaction, which remains top priority.

Our products offer various solutions for short-term and long-term financing, which cater to
working capital, local/foreign trade, strategic expansions, capital markets, syndications, project
finance underwriting and financial advisory. The Group develops carefully cultured solutions for

Pg. 38
Corporates and PSEs, and assures customer satisfaction through an efficient long-term relationship
based business model. Our three dedicated Regional Corporate Centers facilitate our corporate
clientele in a professional and effective manner.

Our relationship oriented outlook focuses upon providing a complete array of tailored financing
solutions, that are practical and cost effective, some of which include:

 Working Capital Facilities

 Term Loans
 Structured Trade Finance Facilities (Long & Short Term)
 Letters of Guarantee
 Letters of Credit
 Export Financing

INVESTMENT BANKING
Investment Banking Division (IBD) focuses on origination and execution of a range of financial
advisory and capital raising services to corporate and institutional clients besides actively
managing the Bank’s proprietary investments in the local equity and debt markets.

Whether a company is seeking to access the local or cross border syndications and debt capital
markets, project financing needs, advisory services related to M&A or the local equity capital
markets for raising capital, Askari Bank’s Investment Banking is well positioned to provide due
assistance. We create and tailor the right structured solutions for the customers’ needs in order to
enhance businesses wealth and market competitiveness.

ISLAMIC BANKING
Askari Bank Limited opened its doors for Shariah compliant banking solutions in the year 2006
by establishing a dedicated Islamic Banking Services Division (IBSD). In a short period of time,
Askari Ikhlas Islamic Banking has grown considerably, and now provides a comprehensive range
of products and services in personal banking, corporate banking, Islamic treasury, trade services

Pg. 39
and Banca-Takaful solutions. Our objective is to put in place an efficient banking system
supportive to economic justice and welfare of society in line with the Shariah principles.

Askari Ikhlas Islamic Banking serves the banking needs of the valued customers through its 94
dedicated Islamic Banking branches (including 3 sub-branches) in the major cities of the country.
The Bank, under its new sponsors and the new management is actively pursuing the growth of
Shariah compliant banking in Pakistan.

Compliance with the principles of Shariah is the cornerstone of our operations. We are driven by
values, embedded in the ethics of Islamic society, established over 1400 years ago. Our ability to
offer a wide array of products and services is a testament to the capacity of Islamic finance to serve
all banking needs of the customers. All our products are developed under the guidance of our
Shariah Board, comprising renowned Shariah Scholars namely, Mufti Muhammad Zahid, Mufti
Ismatullah and Dr. Muhammad Tahir Mansoori.

Our customers enjoy the freedom to choose from a wide array of deposit product menu that offer
flexible term deposit schemes, current accounts and savings accounts. On the consumer banking
front, Askari Ijarah Bis Sayyarah allows the customers to drive a car of their choice, while the
Askari Home Musharakah allows the customers to own a home. Our continuous efforts to provide
a diversified range of Shariah compliant, innovative financial products and solutions to the
corporate/commercial clients continue to win us new relationships.

Askari Ikhlas Islamic Banking is creating a niche through its services, reliability, strength of the
management, and most importantly, its strong sponsors.

AGRICULTURE BANKING

The role of agriculture in Pakistan economy is of a pivotal nature. Due to diverse geographical and
climatic conditions, the country has tremendous potential for agricultural growth and development.
Askari Bank’s Agriculture and Rural Business Division (ARBD) has gained further strength with
improved and efficient delivery and control mechanism for meeting an increased demand for credit
by the farmers in an easy, accessible and affordable manner. With an innovative product range,

Pg. 40
rated best in the market, the Bank continues to surpass its allocated targets for agriculture
financing.

While focusing on business development, this unit also achieved further refinement in back-office
processing, including credit initiation, operations, risk management, in line with the business
dynamics and regulatory framework. ARBD has extended to 89 branches across the country, and
remains proactively engaged with its stakeholders for the aggregation of services and improving
life standard of farmers through its distribution network.

These products that are given by AKBL:

1. Ask Sona Card

2. Askari Kissan Evergreen Finance
3. Askari Kissan Tractor Finance
4. Askari Kissan Livestock Development Finance
5. Askari Kissan Mechanization Finance
6. Askari Kissan Aabpashi Finance

SERVICES:

Now, discuss services that provided by AKBL:

1. Askari Visa Debit Card

2. PayPak Debit Card
3. Automated Teller Machine
4. E- Statement
5. SMS Alert Facility
6. Internet Banking
7. Mobile Banking
8. Union Pay Debit Card
9. Bancassurance
10. Askari Education And Marriage Plan
11. Askari Retirement Plan

Pg. 41
 12. Askari Savings And Life Protection Plan

 ASKARI VISA DEBIT CARD

Customers can manage account, withdraw cash, make purchases and transfer funds through Askari
Visa Debit Card, which offers the convenience of a credit card without the hassle of monthly bills
and interest charges. There are no minimum balance requirements for the issuance or retention of
the VISA Debit Card.

Visa debit card is available in:

 Classic
 Gold

Eligibility:

 Having Pak Rupee checking account under the category of Current, Saving, ASDA, Value
Plus Accounts (Current & Saving) Basic Banking Account and Smart Cash etc., with credit
balance and ‘normal’ status, may apply
 Joint account holders, with the authority to operate the account singly, may be issued
supplementary cards. The supplementary card may be issued to only those joint account
holders who can operate the account singly with either or survivor option
 A customer/staff is allowed to retain as many cards as number of accounts and is allowed
to link multiple accounts with single debit card
 Multiple accounts of same customer, maintained at different branches of Askari Bank, may
also be linked with single VISA Debit Card. If the customer has an account with other
branches, the application receiving branch must verify & confirm the following either
through online system or from the concerned branches.

 PAYPAK DEBIT CARD:

Askari Bank has joined hands with 1Link to enable greater financial inclusion across Pakistan!

Pg. 42
Askari Bank is the first bank to introduce PayPak – Pakistan’s first domestic payment scheme
powered by 1LINK (Guarantee) Limited. This payment solution provides access to all ATMs
across Pakistan so that everyone can fulfill their day-to-day banking needs through this low-cost
and efficient service.

Askari Bank currently provides the following PayPak cards:

Askari PayPak Classic Card

Askari PayPak Gold Card

 AUTOMATED TELLER MACHINE (ATM)

Askari Bank is a member of two electronic ATM inter-bank connectivity platforms i.e., MNET
and 1-link. Through this shared network of more than 11,000 online ATMs, including more than
500 Askari Bank ATMs, AKBL provide services in all major cities of Pakistan.

 E-STATEMENT

The e-Statement facility allows you to keep a close eye on your bank account transactions by
receiving your electronic statement directly into your inbox. All you need is a personal email
address to which your e-Statement will be sent. You can view and print your statement right from
your computer.

Key Features

 e-Statement in pdf format on your given email address

 Receive e-Statement on daily/weekly/monthly/quarterly/semiannual basis (for corporate

customers)

 Receive e-Statement on monthly/quarterly/semiannual basis (for individual customers)

 Free of cost

 Fast, secure and right in your registered email address inbox

Pg. 43
  SMS ALERT FACILITY
Askari Bank SMS Alerts Facility helps you to keep track of your Banking transactions 24/7. By
subscribing the service, you can receive real time SMS alerts for transactions conducted on your
accounts.

Eligibility Criteria

 Active account

 Pakistani Mobile number registered in your name

Key Features

You can register for more than one account or product and an applicable fee per month will be
charged for each account as per prevailing Bank Schedule of Charges.

Secure: SMS Alerts Facility is secure as you will receive alerts on your registered mobile number
which you provide when applying for the facility.

 INTERNET (I.NET) BANKING

Askari Bank’s I-Net banking assures convenient banking from the comfort of your home as
customers are no longer required to wait in long and worrisome queues for a financial transaction,
balance inquiry, statement of accounts, funds transfer, utility bill payment, etc. In addition to these
services, I-Net banking also offers:

 Online Banker’s Cheques delivery at your doorstep

 Online Investment in Mutual Funds managed by Askari Investment Management Limited
(a wholly owned subsidiary)
 Online Insurance premium payment of EFU & JLI
 Online payment for the purchase of Shaheen Airline Tickets • Online LUMS fee payment.

Pg. 44
  MOBILE BANKING
Askari mobile banking solution provides customers with convenient access to their accounts from
their mobile phones, anytime, anywhere. Banking has never been easier than with Askari Mobile
Banking solutions that provide customers with convenient access to their accounts from their
mobile phones, anytime, anywhere.

AKBL offer three types of mobile banking solutions to customers:

 Askari Lite Mobile Banking – browser based solution

 Askari USSD Mobile Banking – available to all mutual customers of Askari Bank and
Ufone
 Askari Mobile Application – for Android, IOS and Windows

 UNION PAY DEBIT CARD

Askari Bank proudly introduces Pakistan’s first EMV & NFC enabled Union Pay Debit Card.

Askari Union Pay Debit Card provides enhanced security with EMV and the convenience of NFC
which enables you to make quick payments directly from your bank account. This card has the
acceptance in more than 162 countries over millions of ATMs and merchants for retail and cash
withdrawal transactions, and is ideal to carry while travelling abroad or domestically.

Askari Union Pay Debit Card is available in the following categories:

 Union Pay Classic Debit Card

 Union Pay Gold Debit Card

Features:

 Worldwide ATM cash withdrawal & balance inquiry

 Worldwide POS transactions

 Enhanced security through EMV chip

 Convenient & quick payments through NFC technology

Pg. 45
  BANCASSURANCE
The Bank offers innovative insurance solutions by fusing together banking, wealth management
and insurance products. In partnership with EFU Life Assurance Limited and Jubilee Life
Insurance Company Limited (JLI), the Bank offers its customers with value-added life insurance
and wealth management products tailored to suit their long term financial requirements and
protection plans.

 ASKARI EDUCATION AND MARRIAGE PLAN

Cost of living is increasing at an exponential pace, and it’s hard to imagine how much would be
needed, when you have to incur expenses on your children’s higher education and marriage. Askari
Bank, in participation with EFU Life, brings Education and Marriage Plan that would help you
secure the financial future of your children. The plan provides a disciplined way of accumulating
an endowment fund that could be used at a later date for a particular purpose, be it to pay for your
children’s college or university fee, or to meet their marriage expenses.

The plan not only provides high value savings, but also guarantees life assurance protection along
with the flexibility to customize the benefits according to individual requirements.

 ASKARI RETIREMENT PLAN

There is no better time than today to plan for retirement. A sound retirement savings plan is
essential for your future financial security, and to enjoy your retirement days to the maximum.
Askari Retirement Plan is an effective financial toll to maintain a decent standard of living upon
retirement. The contributions to this plan are accumulated to build up substantial capital, which is
utilized to provide pension payment to the policyholder from the age of 60 years onwards. The
plan can be tailored to one’s needs by adding a range of protection benefits.

Pg. 46
  ASKARI SAVINGS AND LIFE PROTECTION PLAN
Askari Bank in collaboration with EFU Life brings a high value Savings and Life Protection Plan
that enables you to reach your financial goals in life with added benefit of comprehensive life
insurance coverage. Whether it is for your children’s education or marriage, buying a house,
ensuring regular income after retirement, a trip overseas, or any other vital need, the large
accumulated funds would help you attain your goals. The plan can also be customized to meet
specific needs of the individuals.

3.2. PRICE:

“Market value, or agreed exchange value, that will purchase a definite quantity, weight, or other
measure of a good or service.”

Products prices of AKBL are determined by:

1) SBP

2) Head Office, Rawalpindi

The markup or price paid for services mainly includes:

 Long term loans

 Short term loans
 Letter of credit
 Guarantees
 Bill discounting
 Remittances
 Lockers
 Bank drafts
 Appraisal fee
 Bank commission

Pg. 47
 PRODUCTS CHARGES

Letter of credit (import) Minimum Rs. 2,000/-

Letter of credit (export) Rs. 1,000 for customers

Rs. 2,000/- for non-customers

Issuance of demand draft Rs. 200/- for account holder

Rs. 1,500/- for non- account holder

Cancellation of demand draft Rs. 300/-

Issuance of duplicate demand draft Rs. 600/-

Cancellation of pay order Rs. 100/- for account holder

Rs. 300/- for non- account holder

Issuance of Banker’s Cheque NIL for current account holders

Cancellation of Banker’s Cheque Rs. 200/- for account holders

Rs. 500/- for non-account holders

Duplicate Issuance Banker’s Cheque Rs. 500/- for account holders

Rs. 800/- for non-account holders

Issuance of Banker’s Cheque Through I- Net Banking Rs. 500/- per instrument

LOCKERS: Rs. 3,000/- p.a. or Nil on refundable

security deposit of Rs. 30,000/-
Small

Medium Rs. 3,500/- p.a. or Nil on refundable

security deposit of Rs. 40,000/-

Large Rs. 5,000/- p.a. or Nil on refundable

security deposit of Rs. 50,000/-

Pg. 48
 Extra Large XL Rs 8,000 /- p.a. or Nil on refundable
security deposit of Rs. 60,000/-

Extra Large XXL Rs.10,000/- p.a. or Nil on refundable

security deposit of Rs. 85,000/-

Visa debit card

a) Classic Rs. 1,000/-

b) Gold Rs. 1,200/-

Union pay chip debit card

a) classic Rs. 750/-

b) gold Rs. 1,000/-

PayPak debit card

a) silver Rs. 500/-

b) gold Rs. 500/-

3.3. PLACE:

Marketing tool is placement, which includes the various activities a bank undertakes to make
product and services easily accessible or available to customers. AKBL has opened almost all its
branches at Commercial areas or near to commercial areas so that the customers and clients face
no problems in reaching to the bank

PUNJAB Sahiwal 1 Battagram 1

Attock 4 Sargodha 4 D.I. Khan 1

Bahawalnagar 1 Sheikhupura 2 Haripur 2

Pg. 49
Bahawalpur 4 Sialkot 7 Kohat 1

Burewala 1 Toba Tek Singh 2 Mansehra 1

Chakwal 2 Vehari 2 Mardan 1

Chiniot 1 TOTAL = 158 Nowshera 2

Dera Gazi Khan 2 SINDH Peshawar 8

Faisalabad 7 Ghotki 3 Swat 1

Gujranwala 6 Hyderabad 3 TOTAL = 21

Gujarat 5 Jacobobad 1 BALOCHISTAN

Hafizabad 1 Jamshoro 1 Gwadar 1

Jhang 1 Karachi 73 Jaffarabad 1

Jhelum1 Kashmore 1 Qila Abdullah 1

Kasur 1 Khairpur 2 Quetta 10

Khanewal 1 Larkana 1 TOTAL = 13

Kharian 2 Mirpurkhas 1 Islamabad capital

Khushab 1 Shikarpur 1 Territory 29

Lahore 44 Nawabshah 2 Azad jamu & Kashmir

Layyah 1 Sukkur 1 Mirpur 5

Mundi Bahauddin 1 Rawalpindi 39 Muzafarabad 1

Mianwali 2 Sahiwal 1 TOTAL = 6

Multan 6 Tando Allahyar 1 GILGIT- BALTISTAN

Okara 3 TOTAL = 91 Gilgit 2

Rahim Yar Khan 3 KHYBER Skardu 1

PAKHTUNKHAWA

Pg. 50
Rawalpindi 39 Abbottabad 3 TOTAL = 3

Total branches
Sub – branches
= 321

3.4. PROMOTION

Promotion is one of the four elements of marketing mix (product, price, promotion, distribution).
“It is the communication link between sellers and buyers for the purpose of influencing, informing,
or persuading a potential buyer's purchasing decision.”

The following are two types of Promotion:

ABOVE THE LINE PROMOTION:

Promotion in the media (e.g. TV, radio, newspapers, Internet, Mobile Phones, and, historically,
illustrated songs) in which the advertiser pays an advertising agency to place the ad.

BELOW THE LINE PROMOTION:

All other promotion. Much of this is intended to be subtle enough for the consumer to be unaware
that promotion is taking place. E.g. sponsorship, product placement, endorsements, sales
promotion, merchandising, direct mail, personal selling, public relations, trade shows

Askari bank does its promotion through following ways:

1. Brochures

2. Billboards

3. Ad in the newspaper

4. Direct marketing

5. Public relations

Pg. 51
ADVERTISING
The main source is used by AKBL is advertisement it involves non-personal, mostly paid
promotions often using mass media to deliver the message.

While historically advertising has involved one way – communication with little feedback
opportunity for the customer experiencing the advertisement, the advent of computer technology
and in particular, the internet has increased the option that allow customers to provide quick
feedback. Advertising by newspaper and television is used as a marketing tool by AKBL. However
it is often used when a new product is introduced.

BILL BOARD
Another source is used by AKBL to convey message through bill board. The main areas of urban
era near the school/college, airport and high traffic areas the bill board are placed to convey
message.

BROUCHERS

The bank publishes various brouchers for the general guidance of the customers. These includes
the schedule of charges, VISA card information and savings & term deposits information etc.

PUBLIC RELATION
The most popular tool use by the banker and manager to increase their deposit through loyalty
with customers. AKBL develop loyal relationship with public.

DIRECT MARKETING

AKBL use direct marketing to promote products. The marketing employees visits different places
like universities, colleges, offices etc. and tell about the products the AKBL offer and tells the
benefits if the open account in AKBL.

Pg. 52
 1.1. PUBLICITY

This type of promotion uses third party sources, and particularly the news media, to offer a
favorable mention of the marketer’s company or product without direct payment to the publisher
of the information. For example, media cover any tournament that is sponsored by AKBL.

These are some advertisements that is sponsored by AKBL:

The AKBL made advertisement that is sponsored by bank. In this advertisement the bank give
tribute to our army who sacrifice their life to save our country from enemies. One person visit all
places Pakistan and also shows that the beauty of Pakistan.

In another advertisement of AKBL, this advertisement is about the care finance. In this, the AKBL
give opportunity for everyone to have own car because the bank provide ASK4CAR Auto
Finance for everyone. AKBL provide auto finance with low mark up and down payment and
financing for 1 to 7 years. Through this advertisement people can attract towards and they take
ASK4CAR Auto Finance.

One more advertisement that is made by AKBL. In this, the AKBL introduce Askari Mortgage
Finance. The AKBL gives the opportunity for everyone to buy house and for this bank provide
Askari Mortgage Finance.

Pg. 53
CHAPTER # 4
FINANCIAL STATEMENT
ANALYSIS
 Horizontal Analysis
 Vertical Analysis
 Financial Ratio Analysis

Pg. 54
 ASKARI BANK

BALANCE SHEET

AT THE END OF DEC 31, 2015, 16, 17

Particulars 2015 2016 2017

Rs. In Million Rs. In Million Rs. In Million

Cash and balances with treasury bank 29,685 42,568 44,239

Balances with other banks 8,296 548 3,194

Lending to financial institutions 813 6,837 2,250

Investment 26,8021 295,846 314,957

Advances 199,931 235,164 258,693

Operating fixed assets 9,230 11,020 10,729

Assets held for sale - 262 81

Deferred tax assets - - 100

Other assets 19,891 21,597 22,465

TOTAL ASSETS 53,5867 619,139 656,708

LIABILITIES

Bills payable 6,095 8,580 10,769

Borrowings 57,323 89,262 71,587

Deposits and other accounts 433,172 472,811 525,808

Sub- ordinated loans 4,997 4,995 4,993

Deferred tax liabilities 96 526 -

Pg. 55
Other liabilities 7,330 10,388 11,115

TOTAL LIABILITIES 50,9014 58,6562 62,4273

NET ASSETS 26,853 32,577 32,435

REPRESENTED BY

Share capital 12,603 12,603 12,603

Reserves 6,446 8,671 12,139

Un- appropriate profit/ loss 2,763 4,084 2,659

SHAREHOLDER’S EQUITY 21,812 25,358 27,401

Surplus on revaluation of assets – net 5,041 7,219 5,035

of tax

LIABILITY &SHAREHOLDER’S 26,853 32,577 32,435

EQUITY

Pg. 56
 ASKARI BANK

PROFIT / LOSS STATEMENT

AS ON DEC 31, 2015, 16 & 17

2015 2016 2017

Rs. IN Rs. IN Rs. IN

MILLION MILLION MILLION

Markup/return/interest earned 36,592 35,512 36,267

Markup/return/interest 21,690 20,497 20,072

expense

Net markup/ interest income 14,902 15,016 16,195

Provision against non- 316 (729) (1190)

performing loan advances

Impairment loss on available for 217 23 30

sale investment

Provision of diminution in the 346 48 109

value of investment

Bad debts written off directly - - -

879 (659) (1051)

Net markup/ interest income 14,023 15,674 17,246

after provision

Non markup/ interest income

Fee commission, brokerage 1,732 2,156 2,707

income

Dividend income 303 305 303

Pg. 57
Income for dealing in foreign 835 640 843
currencies

Gain on sale of investment 3,246 3,527 2,063

Other income 573 479 347

Total markup/ interest income 6,689 7,106 6,263

2,0712 2,2781 2,3509

Non-markup/ interest expenses

Administrative expenses 12,014 14,079 14,949

Other provision written off 50 3 22

Other charges 217 222 194

Total non- markup/ interest 12,281 14,304 15,165

expense

Profit/ loss before taxation 8,432 8,477 8,492

Taxation- current (2,230) (2,129) (2,266)

- Prior year (416) (266) (243)

- Deferred (642) (861) (715)

(3,388) (3,256) (3,224)

Profit/ loss after taxation 5,043 5,221 5,268

Pg. 58
 4.1. HORIZONTAL ANALYSIS:

Horizontal analysis = current year – previous year/ previous year

ASKARI BANK

BALANCE SHEET

AT THE END OF DEC, 2015, 16 &17

HORIZONTAL ANALYSIS OF 2015, 16 & 17

Particulars 2015 & 2014 2016 & 2015 2017 & 2016

(%) (%) (%)

Cash and balances with treasury bank 55% 43% 3.92%

Balances with other banks 17% (30%) (45.3%)

Lending to financial institutions (76%) 741% (67.0%)

Investment 23% 10.3% 6.45%

Advances 17% 17.6% 10.0%

Operating fixed assets 11% 18.7% (2.63%)

Assets held for sale - - -

Deferred tax assets - - -

Other assets (3%) 9% 4.02%

TOTAL ASSETS 20% 15.5% 6.06%

LIABILITIES

Pg. 59
Bills payable (11%) 40.7% 25.5%

Borrowings 317% 55.7% (19.8%)

Deposits and other accounts 12% 9% 11.2%

Sub- ordinated loans (37%) (0.04%) (0.04%)

Deferred tax liabilities - 446% 100%

Other liabilities 2% 42% 7%

TOTAL LIABILITIES 20% 15.7% 6.4%

NET ASSETS 13% 21.3% (0.43%)

REPRESENTED BY

Share capital 0% 0% 0%

Reserves 34% 35% 37%

Un- appropriate profit/ loss 48% 48.7% (35%)

SHAREHOLDER’S EQUITY 13% 16% 8%

Surplus on revaluation of assets – net 14% 43% (30.2%)

of tax

LIABILITY & SHAREHOLDER’S 13% 21.3% (0.43%)

EQUITY

Pg. 60
Horizontal Analysis:

INTERPRETATION OF BALANCE SHEET

CASH AND BALANCES WITH TREASURY BANK

The commercial banks to maintain a certain percentage of their deposits with state bank of Pakistan
in cash. Cash and balances with treasury banks shows that cash reserves are dramatically decreased
by 3.92% in 2017. In 2015, the cash reserves are 55% and in 2016 reserves decreased by 43%. The
bank show that the cash reserves decreasing over time. High reserves show better liquidity of bank
so cash reserves should be increased. But Askari bank’s reserves decreased and this is unfavorable
situation for bank.

BALANCES WITH OTHER BANKS

Bank keep balances with other banks to secure their liquidity and avoid any shortage of ready cash
a steady rising trend is desirable. For maintaining high liquidity the commercial bank must keep
reserves with other banks if the bank not do this then the liquidity of bank are decreasing. In 2017,
the liquidity is decreased by 45.3%. In 2015, the liquidity is 17% and in 2016, the liquidity is
decreased by 30%. In this, Askari bank’s liquidity is decreasing over time and this is unfavorable
condition for bank. Askari bank doesn’t hold good balance standings with other banks and these
balances are inconsistent over time.

LENDING TO FINANCIAL INSTITUTIONS

Lending to financial institutions has decreased significantly by 67% in 2017. In 2015, the lending
to financial institutions 76% and this shows the unfavorable results but in 2016 the bank has
dramatically increase their lending to financial institution by 741% but now again lending to
financial institutions decreased. In 2016, the Askari bank show positive results and then the bank
again show negative results. You can see that amount of call money lending and repurchase
agreement lending has decreased significantly there is by decreasing the total amount of lending
to financial institutions. The lending to financial institutions show decreasing trend over time.

Pg. 61
INVESTMENTS
Another the main use of fund is to invest in certain securities. The amount of investment has
decreased by 6.45% in 2017. In 2015, the amount of investment is 23% but in 2016 they decreased
by 10.3%. AKBL show that amount of investment is decreasing over time. AKBL also show that
the Askari bank doesn’t invest money in business and securities. If the bank invest money in
business and in securities the bank earn high return but Askari bank not invest money that’s why
the investment is decreasing over time and this situation is unfavorable for the bank.

ADVANCES
Advances represents lending to general public. Bank can accept deposits and lend to general
public. An increase is desirable as it is the main source of earning. Advances are increased by
17.6% in 2016. In 2015, the advances are 17% but in 2017 the advances are decreased by 10%.
The bank doesn’t give more advances to general public. That’s why this is unfavorable situation
for bank. Bank advances are decreased in 2017.

OPERATING FIXED ASSETS

Asset acquired for or used in the income generating operations of the business and various fixed,
long-term assets. The operating fixed assets are increased by 18.7% in 2016 as compared to 2015
is 11% and in 2017 is 2.63%. Operating fixed assets of AKBL shows negative amount in 2017. It
means that the amount of total assets held by banks are increasing. The bank hold more amount in
cash.

LIABILITIES AND EQUITY

BORROWING

Borrowings decreased by 19.8% in 2017. In 2015, the borrowings are 317% and in 2016 the
borrowings are 55.7%. The bank’s borrowings are decreasing over time. This condition is
favorable for bank because if the borrowings are greater than they also pay interest on this amount.
But now bank has less borrowings this means that bank not pay interest and this is the positive
trend for bank.

Pg. 62
Bills PAYABLE:
Bills payable is the money a bank borrow, mainly on short term basis and owes to other banks.
The bills payable of the bank are -11% in 2016 which increased by 40.7% which again decreased
by 25.5% in 2017.

ASKARI BANK

PROFIT / LOSS STATEMENT

AS ON DEC 31, 2015, 16 & 17

HORIZONTAL ANALYSIS OF 2015, 16 & 17

2015 & 2014 2016 & 2015 2017 & 2016

(%) (%) (%)

Markup/return/interest earned 6% (3%) 2%

Markup/return/interest (4%) (5.5%) (2%)

expense

Net markup/ interest income 25% 1% 9%

Provision against non- 480% (331%) 63%

performing loan advances

Impairment loss on available for 5% (89%) 30%

sale investment

Provision of diminution in the 75% (86%) 127%

value of investment

Bad debts written off directly - - -

Pg. 63
 173% (175%) 59%

Net markup/ interest income 21% 12% 10%

after provision

Non markup/ interest income

Fee commission, brokerage 21% 24% 26%

income

Dividend income (13%) 1% (1%)

Income for dealing in foreign (15%) (23%) 38%

currencies

Gain on sale of investment 80% 9% (42%)

Other income (23%) (16%) (28%)

Total markup/ interest income 23% 6% (12%)

22% 10% 3%

Non-markup/ interest expenses

Administrative expenses 9% 17% 6%

Other provision written off 6% (94%) 633%

Other charges 72% 2% (13%)

Total non- markup/ interest 11% 16% 6%

expense

Profit/ loss before taxation 46% 1% 0.17%

Taxation- current 130% (9%) 6%

- Prior year - (36%) (9%)

Pg. 64
 - Deferred (15%) 34% (16.9%)

92% (4%) (1%)

Profit/ loss after taxation 26% 4% 1%

Horizontal Analysis:

INTERPRETATION OF INCOME STATEMENT

NET MARKUP/INTEREST INCOME AFTER PROVISION

Net markup/interest income after provision is calculated by revenue earned – expenses. The net
markup/interest income is decreasing it means that the bank revenue is decreasing and expenses
are increasing. Net Markup/interest income is decreasing over time showing that interest earned is
less in 2017 is 10% when compared with 2015 and 2016. This is unfavorable situation for bank.
Because they show negative results of the company. If the bank shows that the bank interest
income is increased this is the positive results for bank. But the AKBL shows that interest income
is decreased.

NON-MARKUP/INTEREST INCOME
Total non-markup/interest income has decreased by 3% in 2017 if compared with 2015 and 2016.
The total markup interest income shows a negative result as it is decreasing over year. In 2015, the
total markup interest income is increased by 22% and in 2016 the income is decreased by 10%. In
2015, the markup interest income shows positive result but currently year the markup interest
income is decreased. The growth of non-markup/interest income is unstable.

DIVIDEND INCOME

Distribution of earnings to shareholders that may be in the form of cash, stock, or property. Mutual
fund dividends are paid out of income. The dividend income is very unstable. In 2017, the dividend
income decreased by 1% which is unfavorable for bank. AKBL can see that dividend income is
decreased in 2015 is 13% and in 2016 the dividend income is increased by 1% but then dropped

Pg. 65
again in 2017. Bank must take suitable measures to make investment at right places that yield high
dividends.

NON-MARKUP/ INTEREST EXPENSE

Non markup/interest expenses are decreasing over time. In 2017, the interest expense has
decreased by 6%. In 2015, the interest expense is less as compared to 2016. In 2016 the interest
expense is 16% and then interest expense is decreased. This is a favorable situation for bank that
they control their expenses and they minimize their expense. This is a positive trend for bank.

PROFIT AND LOSS AFTER TAXATION

This shows that the how much bank earn income after paying tax. The bank’s profit and loss after
taxation is high this means that bank earn high income but if not this means that bank not earn high
income. The Askari bank’s income is decreasing over time. The income is 26% in 2015, in 2016
the income is 4% and in 2017 the income is decreased by 1%. This shows that AKBL’s income
decreasing consistently and this is unfavorable for bank. Askari bank need to increase their income
by minimizing their expenses and increase their revenue.

CONCLUSION

The analysis of Askari bank reveals that performance of bank has improved but the bank need
more concentration to improve performance for upcoming years. The net markup/interest income
after provision and non-markup/interest income is decreased. Dividend and profit &loss after
taxation is also decreased but the Askari bank has less expenses the bank work well and minimize
their expenses. But the bank needs to improve overall performance by minimizing their expenses
and increase their revenue through this the bank earn high income or profit.

Pg. 66
 4.2. VERTICAL ANALYSIS:

ASKARI BANK

BALANCE SHEET

AT THE END OF DEC, 2015, 16 &17

VERTICAL ANALYSIS OF 2015, 16 & 17

Particulars 2015 2016 2017

(%) (%) (%)

Cash and balances with treasury bank 6% 7% 7%

Balances with other banks 2% 1% 0%

Lending to financial institutions 0% 1% 0%

Investment 50% 48% 48%

Advances 37% 38% 39%

Operating fixed assets 2% 2% 2%

Assets held for sale - 0% 0%

Deferred tax assets - 0% 0%

Other assets 4% 3% 3%

TOTAL ASSETS 100% 100% 100%

LIABILITIES -

Bills payable 1% 1% 2%

Borrowings 11% 14% 11%

Pg. 67
Deposits and other accounts 81% 75% 79%

Sub- ordinated loans 1% 1% 1%

Deferred tax liabilities - 0% 0%

Other liabilities 1% 2% 2%

TOTAL LIABILITIES 95% 95% 95%

NET ASSETS 5% 5% 5%

REPRESENTED BY

Share capital 2% 2% 2%

Reserves 1% 1% 2%

Un- appropriate profit/ loss 1% 1% 0%

SHAREHOLDER’S EQUITY 4% 4% 4%

Surplus on revaluation of assets – net 1% 1% 1%

of tax

LIABILITY & SHAREHOLDER’S 5% 5% 5%

EQUITY

Pg. 68
Vertical Analysis:

INTERPRETATION OF BALANCE SHEET

ASSETS:

INVESTMENTS:

Investment constitute 50% of total assets in 2015 but this is decreased in 2017 is 48%. This is
decreased by 2%. This is unfavorable for bank. They also show that the Askari bank doesn’t invest
money in business and securities. The bank not earn sufficient returns from investment. The bank
need to invest money in securities and earn high return and that earning returns help to maximizing
bank’s income.

ADVANCES:
Advances constitute 39% of total assets in 2017. In 2015, advances are 37% and 2016 advances
increased by 38%. Advances have increased over time that is favorable situation for bank. It means
that bank lend money to general public and they earn interest and through this the bank’s income
is also increasing. Because bank’s interest rates are attractive.

CASH AND BALANCES WITH TREASURER BANKS:

Cash and balances with treasury bank constitute 7% of total assets in 2017 which was 6% in 2015
and 7% in 2016. The proportion of cash reserves is increasing over time and this is favorable
situation for the liquidity of bank. High reserves show better liquidity of bank and cash reserves
should be increased.

LIABILITIES & EQUITY:

BORROWINGS

The borrowing of bank constitute 11% of total financing in 2015 and 14% in 2016. The borrowings
are increased in 2015 but in 2017 the borrowing is decreased. This is positive impact on bank
because the bank has not to pay interest on borrowings. If the bank borrow money then they also

Pg. 69
pay interest on this amount. But Askari bank not borrow much money from other financial
institutions it means that bank not pay interest.

DEPOSITS AND OTHER ACCOUNTS

Deposits and other accounts constitute 81% of total financing in 2015. But this is decreased 75%
in 2016 and in 2017 the deposits again increased by 79% and this is negative impact on bank
because the bank has to pay interest on these deposits.

SHARE CAPITAL

There is no increase or decrease in share capital in 2015, 2016 and 2017. The share capital of the
banks should be increased by increasing its earning as whether bank has maintained its stability
still in order to grow bank should increase share capital. It evidences that the proportion of share
capital is consistent because the share capital of Askari bank is stable.

ASKARI BANK

PROFIT / LOSS STATEMENT

AS ON DEC 31, 2015, 16 & 17

VERTICAL ANALYSIS OF 2015, 16 & 17

2015 2016 2017

(%) (%) (%)

Markup/return/interest earned 100% 100% 100%

Markup/return/interest 59% 57.7% 55.4%

expense

Net markup/ interest income 41% 42.3% 44.6%

Pg. 70
Provision against non- 0.86% 2.05% 3.28%
performing loan advances

Impairment loss on available for 0.59% 0.06% 0.08%

sale investment

Provision of diminution in the 0.94% 0.13% 0.30%

value of investment

Bad debts written off directly - - -

2.4% 1.86% 2.89%

Net markup/ interest income 38.3% 44.1% 47.5%

after provision

Non markup/ interest income

Fee commission, brokerage 4.7% 6.07% 7.46%

income

Dividend income 0.82% 0.85% 0.83%

Income for dealing in foreign 2.28% 1.80% 2.32%

currencies

Gain on sale of investment 8.87% 9.93% 5.68%

Other income 1.56% 1.34% 0.95%

Total markup/ interest income 18.2% 20% 17.2%

56.6% 64.1% 64.8%

Non-markup/ interest expenses

Pg. 71
 Administrative expenses 32.8% 39.6% 41.2%

Other provision written off 0.13% 0.84% 0.06%

Other charges 0.59% 0.62% 0.53%

Total non- markup/ interest 33.56% 40.2% 41.8%

expense

Profit/ loss before taxation 23.0% 23.8% 23.4%

Taxation- current 6.09% 5.99% 6.24%

- Prior year 1.13% 0.74% 0.67%

- Deferred 1.75% 2.42% 1.97%

9.25% 9.16% 8.88%

Profit/ loss after taxation 13.7% 14.7% 14.5%

Vertical Analysis:

INTERPRETATION OF INCOME STATEMENT

MARKUP/RETURN/INTEREST EXPENSED

The markup/return/interest expensed constitute 55.4% of markup/return/interest earned in 2017

which was 57.7% in 2016 and 59% in 2015. AKBL can notice that this proportion is decreased.
The markup return decreased over time and this is favorable situation for profitability of bank. The
Askari bank is minimize their expenses but it constitute the largest portion in total earnings which
is not good.

NET MARKUP/INTEREST INCOME AFTER PROVISION

The markup/interest income after provision has increased in 2017 is 47.5% of the
markup/return/interest earned. In 2015, the markup after provision is 44.1% and in 2015 is 38.3%.

Pg. 72
As the proportion of net markup/interest income 47.5% of the total interest/markup/return earned.
This shows that the markup/interest income after provision has increased over time. This is
favorable for bank because bank earn more profit.

NON MARKUP/INTEREST INCOME

The largest portion of non-markup/interest income in 2015 is 20% of the markup/return/interest

earned. In 2014, non-markup/interest income is 18.2% and in 2017 is 17.2%. In 2015 the non-
markup/interest income has increased but in 2017 this is decreased and this is unfavorable as to
the profitability of bank. AKBL can notice that proportion of non-markup interest income in the
total earnings of bank is decreasing over time. The bank needs to raise their income and reduce
their expenses.

NON MARKUP/INTEREST EXPENSE

AKBL can see that non markup interest expenses are increasing over time with a proportion of
41.8% in 2017 of markup/return/interest earned. This is unfavorable for bank. Because Askari
bank has contain a large portion of expenses in the income. Every year bank expenses increasing
and the income is decreasing. Bank should take measures to minimize these expenses. Through
this way the bank earn more income than expenses.

CONCLUSION

The vertical analysis of Askari bank reveals that the performance of the bank is not satisfactory
although it has earned profit in 2017 but the performance isn’t consistent. If the bank income
decrease and expenses increase every year it might not be the bank of first choice to lend or invest
from the view point of creditors or investors. Now bank needs to take step toward increase income.
Bank needs to minimize expenses to raise income. The Askari bank profit contained small portion
in revenue earned because the expenses are greater.

Pg. 73
 4.3. RATIO ANALYSIS:

1. TOTAL ASSET TURNOVER:

TOTAL ASSET TURNOVER = MARKUP INTEREST EARNED

TOTAL ASSETS

Total Asset Turnover (2015) = 36,592

535,867
= 0.06

Total Asset Turnover (2016) = 35,512

619,139
= 0.05

Toal Asset Turnover (2017) = 36,267

656,708
= 0.05
2015 2016 2017
Total Asset Turnover 0.06 0.05 0.05

Interpretation:

The asset turnover ratio measures how efficiently a company is using assets to generate sales.
Therefore, a higher ratio is favorable, as it indicates a more efficient use of assets. Conversely, a
lower ratio indicates that the company is not using assets as efficiently as it might. This can be due
to excess production capacity, poor collection methods, or poor inventory management. The bank
ratio shows that turnover is high in 2015 and they decrease in 2016 but they show consistency in

Pg. 74
2017. In 2015, the bank utilize its assets efficiently and this is favorable as compared to 2016 and
2017. Now the bank need to utilize its assets efficiently to generate sales.

TOTAL ASSET TURNOVER

0.07
0.06
0.05
0.04
0.03
0.02
0.01
0
2015 2016 2017
TOTAL ASSET TURNOVER

2. DEBT RATIO:

DEBT RATIO = TOTAL LIABILITIES

TOTAL ASSETS

Debt Ratio (2015) = 509,014

535,867
= 0.949 OR 94.9%

Debt Ratio (2016) = 586,562

619,139
= 0.947 OR 94.7%

Pg. 75
Debt Ratio (2017) = 624,273
656,708
= 0.95 OR 95%
2015 2016 2017
Debt Ratio 94.9% 94.7% 95%

Interpretation:

It shows how much the company relies on debt to finance assets. The debt ratio gives users a quick
measure of the amount of debt that the company has on its balance sheets compared to its assets.
The higher the ratio, the greater the risk associated with the firm's operation. A low debt ratio
indicates conservative financing with an opportunity to borrow in the future at no significant
risk. The Askari bank has slightly change in debt ratio. In 2015, the debt ratio is 94.9%, in 2016
the ratio is slightly decreased by 94.7% and in 2017, the ratio has again increased by 95%. In 2017,
this shows that greater risk associated with bank operations and it has more financial leverage as
compared to 2015 and 2016.

DEBT RATIO
95.10%
95.00%
94.90%
94.80%
94.70%
94.60%
94.50%
2015 2016 2017
DEBT RATIO

Pg. 76
 3. SPREAD RATIO

SPREAD RATIO = NET MARKUP/INTEREST INCOME

* 100
MARKUP/INTEREST EARNED

Spread Ratio (2015) = 14,902

36,592
= 41%

Spread Ratio (2016) = 15,016

35,512
= 42%

Spread Ratio (2017) = 16,195

36,267
= 45%

2015 2016 2017

Spread Ratio 41% 42% 45%

Interpretation:
The larger a bank's interest rate spread, the more it earns and the more it is therefore worth. When
interest rates change, however, the interest a bank receives on its assets and pays on its liabilities
fluctuates and can decrease income. The bank spread is a percentage that tells someone how much
money the bank earns versus how much it gives out. The spread ratio of Askari Bank is increasing
over time. In 2015, the spread ratio is 41%, in 2016 the ratio is increased by 42% and in 2017 the
ratio is increased by 45%. This shows that the spread ratio has increased but this means that the

Pg. 77
bank has unable to reduce deposits rates proportionately that’s why spread ratio start moving up.
Higher spread ratio means higher profitability because deposits rates are high.

SPREAD RATIO
46%
45%
44%
43%
42%
41%
40%
39%
2015 2016 2017
SPREAD RATIO

4. NET INTEREST MARGIN RATIO

NET INTEREST MARGIN RATIO = Total Interest Income – Total Interest Expense

Total Assets
Net Interest Margin Ratio (2015) = 36,592 – 21,690
535,867
= 2.78%

Net Interest Margin Ratio (2016) = 35,512 – 20,497

619,139
= 2.41%

Pg. 78
Net Interest Margin Ratio (2017) = 36,267 – 20,072
656,708
= 2.47%

2015 2016 2017

Net Interest Margin 2.78% 2.41% 2.47%
Ratio

Interpretation
Net interest margin formula is a measure of how well investment strategy is executed. If the NIM
is less, there is a room for improvement and if the NIM is well on target, then maybe the investor
may continue with the same sort of investments. The Askari bank has slightly change in interest
margin ratio. In 2015, the interest margin ratio is 2.78%, in 2016 the ratio is decreased by 2.41%
and in 2017, the ratio has again increased by 2.47%. In 2017, this shows that the bank made good
investment decisions this year and used its resources effectively to earn a high return.

NET INTEREST MARGIN RATIO

2.90%
2.80%
2.70%
2.60%
2.50%
2.40%
2.30%
2.20%
2015 2016 2017
NET INTEREST MARGIN RATIO

Pg. 79
 5. RETURN ON ASSETS

RETURN ON ASSETS = Net Profit after Tax

Total Assets

Return on assets (2015) = 5,043

535,867
= 0.94%

Return on Assets (2016) = 5,221

619,139
= 0.84%

Return on Assets (2017) = 5,268

656,708
= 0.80%

2015 2016 2017

Return on Assets 0.94% 0.84% 0.80%
Interpretation:
Just like other variations of rate of return, the higher the return on assets the better. A high return
on assets means than the business was able to utilize its resources well in generating income. It is
also noteworthy to mention that this ratio removes the effect of company size. Return on assets of
Askari bank has decreasing over time. In 2015, the ROA is 0.94% that is high as compared to 2016
and 2017. In 2016, the ROA is decreased by 0.84% and in 2017, the ROA is decreased by 0.80%.
This means that the bank does not utilize its assets efficiently that’s why the return on is decreased
over time and they not earn return.

Pg. 80
 RETURN ON ASSETS
1.00%

0.95%

0.90%

0.85%

0.80%

0.75%

0.70%
2015 2016 2017
RETURN ON ASSETS

6. RETURN ON EQUITY

RETURN ON ASSETS = Net Profit after Tax

Total Shareholder’s Equity

Return on Equity (2015) = 5,043

21,812
= 23%
Return on Equity (2016) = 5,221
25,358
= 20.58%

Return on Equity (2017) = 5,268

27,401
= 19.22%

Pg. 81
 2015 2016 2017
Return on Equity 23% 20.58% 19.22%

Interpretation:
A high return on assets shows than the business was able to successfully utilize the resources
provided by its equity investors and the company’s accumulated profits in generating income. The
return on equity has decreased over time. In 2015, the return is high that is 23% but in 2015 the
return is decreased by 20.58% and in 2017 the return is decreased by 19.22%. In 2015, the bank
uses investments to generate earnings but in 2016 and 2017 the bank not used investments well
that’s why they not generate much earnings as compared to 2015.

RETURN ON EQUITY
24%
23%
22%
21%
20%
19%
18%
17%
2015 2016 2017
RETURN ON EQUITY

7. INTEREST RATIO

INTEREST RATIO = Interest Paid

Interest Earned

Pg. 82
Interest Ratio (2015) = 21,690
36,592
= 59.27%
Interest Ratio (2016) = 20,497
35,512
= 57.71%

Interest Ratio (2017) = 20,072

36,267
= 55.34%

2015 2016 2017

Interest Ratio 59.27% 57.71% 55.34%

Interpretation:
The interest ratio is decreasing over time. In 2015, the ratio is 59.27%, in 2016 the ratio is
decreased by 57.71% and in 2017 the ratio is decreased by 55.34%. This means that the lower the
ratio the less the bank is burdened by debt expenses and this is a good sign for bank that debt
expense is reduced every year.

INTEREST RATIO
60.00%
59.00%
58.00%
57.00%
56.00%
55.00%
54.00%
53.00%
2015 2016 2017
INTEREST RATIO

Pg. 83
 8. ADMINISTRATIVE EXPENSE TO PROFIT BEFORE TAX

ADMINISTRATIVE EXPENSE TO PROFIT BEFORE TAX = Administrative Expense

Profit before Tax
Administrative Expense to Profit before Tax (2015) = 12,014
8,432
= 1.44

Administrative Expense to Profit before Tax (2016) = 14,079

8,477
= 1.66

Administrative Expense to Profit before Tax (2017) = 14,949

8,492
= 1.76

2015 2016 2017

Administrative 1.44 1.66 1.76
expense to profit
before tax

Interpretation:
The administrative expense to profit before tax is increasing over time. In 2015, the ratio is 1.44,
in 2016 the ratio is increased by 1.66 and in 2017 the ratio is increased by 1.76. The ratio is increase
this means that the expenses are high in 2017 that’s why the profit is decreased because when
expenses are high the profit is decreased. This is unfavorable situation for bank. The bank need to
reduce their expenses.

Pg. 84
 ADMINISTRATIVE EXPENSE TO PROFIT BEFORE
TAX
2
1.5
1
0.5
0
2015 2016 2017
ADMINISTRATIVE EXPENSE TO PROFIT BEFORE TAX

9. CAPITAL RATIO

CAPITAL RATIO = Total Shareholder’s Equity

Total Assets

Capital Ratio (2015) = 21,812

535,867
= 4.07%

Capital Ratio (2016) = 25,358

619,139
=4.09%

Capital Ratio (2017) = 27,401

656,708
= 4.17%

Pg. 85
 2015 2016 2017
Capital Ratio 4.07% 4.09% 4.17%

Interpretation:
The capital ratio measures the ability of a financial institution to meet its obligations by comparing
its capital to its assets. When this ratio is high, it indicates that a financial institution has an
adequate amount of capital to deal with unexpected losses. When the ratio is low, an entity is at a
higher risk of failure. Capital ratio is slightly increasing over time. In 2015, the capital ratio is
4.07%, in 2016 the ratio is increased by 4.09% and in 2017 the ratio is increased by 4.17%. This
is favorable situation for bank because capital ratio is increased and they indicate that bank has
adequate amount of capital to deal with unexpected losses.

CAPITAL RATIO
4.18%
4.16%
4.14%
4.12%
4.10%
4.08%
4.06%
4.04%
4.02%
2015 2016 2017
CAPITAL RATIO

10.GROSS ADVANCES TO DEPOSITS

GROSS ADVANCES TO DEPOSITS = Gross Advances

Deposits

Pg. 86
Gross Advances to Deposits (2015) = 199,931
433,172
= 46.15%

Gross Advances to Deposits (2016) = 235,164

472,811
= 49.7%

Gross Advances to Deposits (2017) = 258,693

525,808
= 49.19%

2015 2016 2017

Gross Advances to 46.15% 49.7% 49.19%
Deposits

Interpretations:
The loan to deposit ratio can be used by investors to determine the financial institutions short term
viability. The loan to deposit ratio may be used to ensure that any money needed is immediately
available. If the ratio is lower than one, the bank relied on its own deposits to make loans to its
customers, without any outside borrowing. The gross advances to deposits is high in 2016 as
compared to 2015 and 2017. In 2015 the advances to deposits is 46.15%, in 2016 the ratio is
increased by 49.7% and in 2017 the ratio is again slightly decreased by 49.19%. When ratio is high
this means that the bank may not have enough liquidity to cover unforeseen funds requirements.

Pg. 87
 GROSS ADVANCES TO DEPOSITS
50.00%
49.00%
48.00%
47.00%
46.00%
45.00%
44.00%
2015 2016 2017
GROSS ADVANCES TO DEPOSITS

11.EARNINGS PER SHARE

EARNINGS PER SHARE= Profit after Taxation

No. Of Ordinary Shares

Earnings per Share (2015) = 4,902,661

1,260,260
= 3.89

Earnings per Share (2016) = 5,226,947

1,260,260
= 4.14

Earnings per Share (2017) = 5,121,686

1,260,260
= 4.06

Pg. 88
 2015 2016 2017
Earnings per Share 3.89 4.14 4.06

Interpretation:
The shares are normally purchased to earn dividend or sell them at a higher price in future. The
higher the EPS figure, the better it is. A higher EPS is the sign of higher earnings. The earning per
share of Askari bank is high in year 2016 as compared to 2015 and 2017. In 2015, the EPS is 3.89,
in 2016 the EPS is increased by 4.14 and in 2017 the EPS is decreased by 4.06 but there is slightly
change between 2016 and 2017. This means that the bank earn high amount in 2016 on behalf of
each outstanding shares of common stock.

EARNINGS PER SHARE

4.2
4.15
4.1
4.05
4
3.95
3.9
3.85
3.8
3.75
2015 2016 2017
EARNINGS PER SHARE

12.CASH & CASH EQUIVALENT TO TOTAL ASSETS

Cash & Cash Equivalent = Cash & Balance with Treasury Bank + Balance with other bank
Total Assets

Cash & Cash Equivalent (2015) = 29,685 + 8,296

535,867

Pg. 89
 = 7.08%

Cash & Cash Equivalent (2016) = 42,568 + 5,846

619,139
= 7.81%

Cash & Cash Equivalent (2017) = 44,239 + 3,194

656,708
= 7.22%

2015 2016 2017

Cash & Cash 7.08% 7.81% 7.22%
Equivalent to total
assets

Interpretation:
The value of a company's assets that are cash or can be converted into cash immediately. Cash and
cash equivalents are the most liquid assets. It means the bank show the liquidity of bank. The cash
& cash equivalent to total assets are high in 2016 is 7.81%. In 2015, the ratio is 7.08% and in 2017
the ratio is 7.22% which shows that ratio increase in 2016 but the ratio again decreased in 2017.
This is unfavorable situation in 2017. In 2016, it show good liquidity as compared to 2015 and
2017.

Pg. 90
 CASH & CASH EQUIVALENT
8.00%
7.80%
7.60%
7.40%
7.20%
7.00%
6.80%
6.60%
2015 2016 2017
CASH & CASH EQUIVALENT

13.TOTAL DEPOSITS TO TOTAL EQUITY

Total Deposits to Total Equity = Total Deposits

Total Equity

Total Deposits to Total Equity (2015) = 433,172

21,812
= 19.85
Total Deposits to Total Equity (2016) = 472,811
25,358
= 18.6
Total Deposits to Total Equity (2017) = 525,808
27,401
= 19.18

2015 2016 2017

Total Deposits to 19.85 18.64 19.81
Total Equity

Pg. 91
Interpretation:
Total deposits to total equity ratio is increase in 2015 as compared to 2015 and 2016. In 2015 the
ratio is 19.85 which is decreased by 18.64 in 2016 and in 2017 it shows that the ratio is again
increased by 19.81.

TOTAL DEPOSITS TO TOTAL EQUITY

20

19.5

19

18.5

18
2015 2016 2017
TOTAL DEPOSITS TO TOTAL EQUITY

CONCLUSION:
The analysis of Askari bank reveals that performance of bank has improved but the bank need
more concentration to improve performance for upcoming years. The net markup/interest income
after provision and non-markup/interest income is decreased. Dividend and profit &loss after
taxation is also decreased but the Askari bank has less expenses the bank work well and minimize
their expenses. But the bank needs to improve overall performance by minimizing their expenses
and increase their revenue through this the bank earn high income or profit.

In horizontal analysis, Cash and balances with treasury banks is decreased 3.92% in 2017. Askari
bank’s reserves decreased. Balance with other bank 2017, the liquidity is decreased by -45.3%. In
2015, the liquidity is 17% and in 2016, the liquidity is decreased by -30%. Askari bank doesn’t
hold good balance standings with other banks and these balances are inconsistent over time. In
2017 the advances are 10%. The bank doesn’t give more advances to general public. In 2017,
borrowings are 19.8% which is less in 2017. Bank has less borrowings this means that bank not
pay interest.

Pg. 92
The vertical analysis of Askari bank reveals that the performance of the bank is not satisfactory
although it has earned profit in 2017 but the performance isn’t consistent. If the bank income
decrease and expenses increase every year it might not be the bank of first choice to lend or invest
from the view point of creditors or investors. Now bank needs to take step toward increase income.
Bank needs to minimize expenses to raise income. The Askari bank profit contained small portion
in revenue earned because the expenses are greater.

In ratio analysis, bank need to utilize its assets efficiently to generate sales. In 2017, this shows
that greater risk associated with bank operations and it has more financial leverage. In 2017, spread
ratio is high this means higher profitability because deposits rates are high. In 2017, this shows
that the bank made good investment decisions this year and used its resources effectively to earn
a high return. The bank does not utilize its assets efficiently that’s why the return is decreased.
Bank has less investment and bank also have high administrative expenses. Capital ratio is high
this means the bank has adequate amount of capital to deal with unexpected losses.

AKBL needs to improve her performance and the bank also need to efficiently utilize its assets to
generate sales. Bank needs to minimize expenses and maximize their earnings or revenue. Bank
performance is improve but more improvement needed.

Pg. 93
CHAPTER # 5
SWOT ANALYSIS
 Strength
 Weakness
 Opportunities
 Threats

Pg. 94
 SWOT ANALYSIS
SWOT analysis is one of the most expedient technique or tool used in the Strategic Management
process for conducting the situation analysis of an organization. The proper analysis of the firm is
given in the form of Strengths, Weaknesses, Opportunities and Threats (SWOT) the company
presently facing or can be forecasted for the future. It is a common approach to make assessments
in terms of internal and external environment of the organization, and to formulate strategies
analyzing its internal strengths and weakness, external opportunities and threats, coming up is the
SWOT analysis for the AKBL. Such an analysis is very important for the management in retaining
the strength, overcoming the weaknesses, capitalizing over the emerging market opportunities, and
carving ways to successfully tackle with the threats and ultimately converting them in the strengths
for the organization.

5.1. STRENGTHS

1. COMPUTERIZATION

The main strength of AKBL Limited is that all of its branches are fully computerized and the have
latest software’s available to keep the records of their customers account and other important
information up-to-date. It reduces manual work and provides good customer services.

2. CUSTOMER’S FEEDBACK

Customers are allowed to give suggestions regarding banking services. If there is any complaint
by the customer the bank authorities investigates the reasons for complaint. Complaint monitoring
system is excellent at AKBL that shows bank values more to its customers.

3. ATM FACILITY

The bank has also started ATM facility in most of its branches. 24-hour banking is new trend in
Pakistan and AKBL has also taken apart in this trend. Askari Bank Limited has one of the largest
ATM networks in the country and records show that it is very rare that an ATM at Askari Bank
suffers from a problem like a down link or out of cash because prompt management by the
managers ensures that such lapses do not occur in the first place. This is also a source of

Pg. 95
revenue for Askari Bank as clients of other bank use ATM’s of Askari Bank due to their
superior quality and strategic positioning thus becoming a source of revenue

4. TRANSFERRING FUNDS

AKBL has got a well-developed on-line system in most of its branches. Remittance Department is
working very efficiently in transferring the funds of people due to this system. AKBL management
is quite prepared to adopt the latest advancements in technology resulting in revolution in the
banking operations such as check clearing process, computer based teller equipment, automatic
teller machines, and electronic funds transfers among the others

5. INTERNET BANKING

AKBL is the first bank to introduce I-banking which provides convenience to customers by
enabling them to gain access to their account and carry out any transaction sitting at home. Internet
banking operations have opened avenues of excellent, efficient and quick services saving the time
and costs of the customers and fortunately.

6. WORLDWIDE MASTER CARD

The AKBL ATMS Master Card has become a global service furthering the convenience to the
customers. Traveling customers can access their accounts from a large number of internationally
deployed ATMs and point of sale unit.

7. ETHICAL CONCERNS AND PUBLIC IMAGE:

Askari Bank shows deep ethical concerns and makes sure as to negate any feeling of hatred both
inside and outside the organization. The organizations showing concern for the people, ethics, and
environment enjoy good public reputation and are able to reap the benefits in the long run. AKBL
management is quite sensitive to this issue.

8. TAILORED SOLUTIONS:

The management at Askari Bank believes in the customer and not so much in the product and are
always more than willing to alter or tailor their products to suit the needs of the customer.

Pg. 96
 9. INFORMATION SYSTEM

Askari Bank has also invested heavily in information technology resources, which has now
allowed bank to develop one of the most comprehensive and advanced system available. With the
help of this system Askari bank has now achieved an “online” status via real time facilities and
features available through nationwide network. With the team of highly qualified professionals,
Askari Bank is able to use its real time system resources to provide customers with comprehensive
account of their transaction on a daily basis. AKBL is one of those few banks who are reaping the
benefits of electronic transaction.

10. TRANSPIRANCY OF ACCOUNTS

AKBL has won several national awards in recognition to the transparency with which it presents
its annual reports. The annual financial statement are prepared by the bank in accordance with the
international accounting standard and are also published quarterly and half yearly accounts to
provide information to their stakeholders for taking well informed decisions.

11. PHONE BANKING SERVICE

In order to save their customers time, AKBL provides the good Phone banking service that is very
attractive especially for those customers who don’t have time to personally visit to the bank. Phone
banking service is very attractive for those classes of customers who don’t have time to personally
come to the bank i.e. banking on the phone line thus saving the precious time of the customers.

12. CUSTOMER ORIENTED BANKING

AKBL’s vision is “to be the bank of first choice”. In order to achieve its vision, AKBL offers the
very highest levels of personalized banking to match customer’s unique status. The priority
banking centers of the bank offer an unmatched where the customer receives highly privileged
services in a highly elegant environment. It gives the chance of experiencing new standards in
banking. Designed especially for those who appreciate only the finest things in life

Pg. 97
 5.2. WEAKNESSES

1. LACK OF TECHNICAL TRAINING

Although the staff in charge of handling technical operations is highly trained, technical knowhow
in lower levels is still not that much, the bank needs to make arrangements in order to promote this
in the lower level.

2. TRADITIONAL WAYS OF RECORDING TRANSACTIONS

The bank has still some of the traditional ways of operations in this advanced technological
environment. AKBL has use computerized accounting system but, still the bankers use to make
their entries in the accounting register also. For example account opening registers, manual
checking of vouchers.

3. LACK OF PROPER EQUIPMENT AND PROCEDURES

No availability of sophisticated equipment’s in branches and lengthy credit processing and

documentation procedures. The bank not upgrade equipment. Bank has long procedure for loans
or cars. Bank needs to upgrade equipment or documentation procedure should be need to short.

4. LACK OF TRAINING FACILITIES

For the new recruits there is no specific training program or facility and most of them are
straightaway sent to the branches where they learn about the operations by actually doing them
which sounds fine on paper but in reality it amounts for a lot of errors which cost customers plus
they take a lot of time to pick the normal pace of work.

5. JOB ROTOTATION

The employees of AKBL are constantly subjected to job rotation. It keeps back from gaining
complete know-how about a particular department. The employees of AKBL not gaining proper
information about particular department because the employees rotate in every department. When
employees starting learn about the particular department the bank rotate employee in another
department.

Pg. 98
 6. MANUAL RECORDS:

Despite having a state of the art computerized management system the staff still relies on
traditional hand written book keeping along with electronic entries with the excuse that electronic
systems are not always reliable and this activity of theirs wastes time.

7. CENTRALIZED MANAGEMENT PRACTICES

The management system in AKBL is quite centralized leaving all the decision-making activities
to the upper management only. Employee empowerment is also over looked due to such
management policy. I personally observed that delay occurred in the operations of the employees
only due to the fact that they had not got any instructions from the head office

8. LOW JOB SATISFACTION

Understanding and the effective of the human resources is the most difficult challenge faced not
only by the bank but management by all the organizations. Even though the people have been
sacrificed in the new organizational developments, it is becoming clear that the true lasting
competitive advantage comes through human resources and how they are managed. AKBL seems
to not focusing on this highly critical issue as the job satisfaction level of the employees working
at AKBL, was quite low.

5.3. OPPORTUNITIES

1. ISLAMIC BANKING:

Islamic banking is a rising field in the Pakistani banking industry with nearly all the banks
competing in this section and Askari has only a few branches to cater those needs so they first of
all need to step up their attention in the Islamic banking sector.

2. RURAL AREAS:

Rural areas present a golden opportunity for any bank in Pakistan because development is taking
place at a high rate and soon the areas which were once neglected will present golden business

Pg. 99
opportunities. AKBL provide services in rural areas because largest population of Pakistan live in
rural areas and the services of bank is not available there.

3. TECHNOLOGICAL UPGRADES:

Even though it is a costly fixed expenditure still a lot of banks are moving towards technological
upgrades and for a bank with this large a customer base technological upgrades can only be but
profitable. Now people are well educated and know about the latest technology. Bank should
upgrade technology according to the environment or needs.

4. NEW MODES OF BANKING SERVICES

Askari Bank is now looking into new ways of providing banking services to its customers. New
concept of mobile banking has been introduced by the bank, which will prove to be remarkable
success in the field of consumer banking.

5. INCREASING CUSTOMER DEPOSITS

It is opportunity for Askari commercial bank to steady increase customer deposit by adopting new
marketing and promotion scheme and lunch new scheme for their customer deposits. With the
customer base increasing at a steady rate the deposits are also slowly climbing so there is a good
chance for investment by the bank because some of their customers like those from the Armed
forces are guaranteed and are a source of huge deposit base.

6. FOREIGN INVESTMENT

Due to efficient and experienced management group, AKBL can also improve well and expend its
foreign operation successfully. It is external opportunity for Askari commercial bank to avail it
and take a competitive edge and create a strong identity worldwide.

7. OPPORTUNITIES IN LOAN BUSINESS

Askari bank is an active player in the loan business. Its strength in loaning stems from its ability
to forge strong relationships not only with borrowers but also with bank investors. Bank can
capture more markets by introducing new products for business community, as it is the only group,
which can contribute towards increasing the assets of the bank.

Pg. 100
 8. E-BANKING

AKBL should emphasize on E - Banking. In which Bank can design a universal account like other
foreign banks, to enhance online facilities. AKBL needs to use E-banking. Online transfer of funds
in sitting at home facility should be provided to customers. Banks needs to efficiently used E-
banking and provide convenience to the customers.

9. EXPANSION OPPURTUNITIES

AKBL growing business requires further expansion of branch network which would, in return,
open great opportunities for AKBL for the expansion of its business. AKBL can also extend its
network in other countries. Increasing the product range to fulfill customer requirements and ATM
network, ABL can expand its 24 hours cash facilities to other cities of the country in order to meet
growing market demand. AKBL as a largest Pvt. Bank can also increase its market share by
producing good, market oriented and customer needs satisfying products.

10. TARGETTING THE COMPUTER LITERATE SEGMENT

Now computer literacy rate is increasing and its really big opportunity for Askari Bank that when
public will have more knowledge about computers than they will be more attractive to the
innovative products of Askari bank.

5.4. THREATS

1. HIGH COMMISSIONS

The commissions and charges by the bank for some of the facilities are alarmingly high this is a
very serious situation for the bank as those customers can be snatched by the other banks then. The
AKBL charge high commission that the service or product provide. That’s why people acquire
other banks and pay low commission on the same services or products.

Pg. 101
 2. HIGH TURNOVER

Turnover is a little high in Askari Bank and in my understanding it is not due to the remuneration
policies but the high level of centralization which provides little or no space for the self-motivated
personnel. As soon as they get a better opportunity, they switch.

3. INFLATION

In our county, the rate of inflation is increasing along with the unemployment. So due to increase
in price of the products, the savings of the nation is decreasing with passage of time. So it is threat
for the banking sector. In the future, the deposits of the bank will decrease if the same situation
occurs every time.

4. COMPETITION BY LOCAL BANKS

As the AKBL leading in the domestic commercial banking sector in Pakistan, as such there are no
close competitors of AKBL but every commercial bank is the competitor for each other. But
mainly these are Habib Bank Limited, Bank Al-Falah, MCB etc. they are threats for ABL. At any
time they can capture the clients of ABL by providing any benefit more than that.

5. LEGAL REGULATION

Frequent change in government policies creates new challenges for the top management. AKBL
also faces such threats particularly when policies regarding taxation are subjected to changes. It is
always threat for commercial banks. Because SBP is the role authority of Government, which
monitors all commercial banks affairs, whenever it feels any regulation, it imposes without
consideration of commercial banks plans etc.

6. LOW ATTRACTION FOR INVESTORS

As the banking procedures are complicated that is why general public takes interest into other
options of investments like in shares of companies and in Term Finance Certificates. Being a
commercial bank, AKBL faces considerable competition in attracting deposits from individuals or
small investors.

Pg. 102
 7. LOWER RATES OF RETURN

The rates of return offered by Askari Bank are not that high and as a result they have a hard time
convincing customers to invest in the bank primarily due to this reason. This situation become a
big threat for AKBL. Because bank offer low rate of return that’s why people invest their money
in other banks or businesses.

8. LEGAL REGULATION

Frequent change in government policies creates new challenges for the top management. AKBL
also faces such threats particularly when policies regarding taxation are subjected to changes. It is
always threat for commercial banks. Because SBP is the role authority of Government, which
monitors all commercial banks affairs, whenever it feels any regulation, it imposes without
consideration of commercial banks plans etc.

9. LESS EXPERIENCED STAFF

AKBL is short of experienced and well trained staff owing to high turnover. Majority of the
staff working in the bank branches is quite young and inexperienced. If the bank fails to bring
down its high employee’s turnover, then it would be lacking the most important resources of any
organization i.e. the experienced staff.

10. ECONOMIC ENVIRONMENT

Economic environment is a major threat for AKBL. For example, in 2015 recession shakes every
sector of economy, bank sector is one of them. GDP growth and poverty alleviation in a different
economic environment with continued international sanctions.

11. POLITICAL PRESSURE BY ELECTED GOVERNMENT

The ongoing shift in power in political arena in the country effects the performance of the (bank
has to forward loans to politically powerful persons which create a sense of insecurity and
demoralization in the customer as well as employees

Pg. 103
CHAPTER # 6
TRAINING PROGRAM
 Divisional or departmental detail
 Activities of intern

Pg. 104
6.1. DIVISIONAL OR DEPARTMENTAL DETAIL

Working of the Bank divided between various departments. Different departments do their jobs in
occurrence with the bank policies. In AKBL each branch is divided into various departments. Head
of department manages each department & officials of the branch follow procedures. The working
of the Department within branch is as:

1. Account Opening Department

2. Remittances Department
3. Cash Department
4. Clearing Department
5. Accounts Department

1. ACCOUNT OPENING DEPARTMENT

Banker customer relationship starts from opening an account when a person opens an account with
a bank the banker customer relationship is established. This Department is intended to help
customers to open an account and to guide customers about different types of accounts being
offered by the bank and help them to choose a suitable account to open. From filling form till
receiving an account number and receiving checkbook or ATM card is the responsibility of this
department to facilitate customers in all manners. It is advisable that a banker should not open new
accounts of unknown person unless banker obtains as much information as possible about the
character and integrity of the person his name, address and the person.

Customer is a source of fresh deposits therefore is welcomed by the banker. References are
demanded for the following reasons:

 Precaution to avoid fraud

 Safeguard against unintentional overdraft
 Inquiries about customer
 Proof of reasonable care and enquiry

Pg. 105
No bank can run its operations without deposits. Channelizing funds from the savers to ultimate
users is the main function of commercial bank. Bank borrows in form of deposits the borrowed
capital of a bank is greater than their own capital. Deposit creation is done by opening an account
in bank. Two broad categories of deposits are Demand Deposits and time deposits. There are
different categories of deposits current deposit, value plus current deposit, call deposit, PLs saving
account, Askari special deposit account, value plus, and Askari basic banking account.

FUNCTIONS OF ACCOUNT OPENING DEPARTMENT

There are the functions of account opening department.

 Providing account opening form according to the customer’s requirements

 Guide the customer about the requirements of the account opening and form filling
 Check the forms whether they are correctly completed or not
 Preparing checklist
 Stamping on the form
 Maintaining account opening register
 Pasting of forms in register after release from general banking in charge
 Issuance of cheque books
 Issuance of accounts maintenance certificate
 Closure of account in case of customer want.
 Verification of signature in case of cheque presented before releasing of account opening
from SS card is not yet scanned.

ACCOUNT OPENING PROCEDURE:

Opening of bank account is the primary step to a relationship between the bank and the customer.
As the opening of a bank account by a person makes him a customer of the bank, the account
opening process must not be considered just a formality. Knowing the customer should be the
objective of the banker and customer due diligence must be done prior to establishment of the
relationship. The basic documents to be obtained at the time of opening of account are:

 Account opening form

Pg. 106
  National identity card
 Specimen signature card
 Additional documents depending on the constitution of the account

Know Your Customer (KYC):

While opening accounts of customers, all reasonable efforts must make to

determine the true identity of the customer and the sources & utilizations of funds. To have a
uniform procedure for customer due diligence, a Know Your Customer (KYC) has been introduced
which is to be completed by the account opening officer/ operations manager/ branch manager.
During the course of meetings with the customer to complete the account opening formalities, they
should be asked about the type of the transactions for which the bank account would be used and
any information gathered must be recorded on the KYC Form. Any further information felt
necessary and obtained during conversation with the customer should be recorded on the KYC
Form and placed on record.

Informal Session with the Customer:

An informal session with the customer should be arranged to assess and ascertain
his/her credibility. While having a face to face interactive session with the customer, following
points must be borne in mind, so that at the time of filling the KYC form, comments column would
contain all the required and necessary information.

For A Salaried Person:

This is list of documents that require in account opening for salaried person:

 Name of employer
 Designation of the customer
 Approximate salary
 Area of residence
 Residence status whether owned, rented etc.
 Expected inflow/ transfer of funds in the account
 Overall background

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  Source of funds
 Any other information

For Self-Employed:

This is list of documents that require in account opening for self-employed:

 Name of the concern

 Constitution of the concern
 Field of operation
 Nature of transactions
 Expected inflow/ transfer of funds in the account
 Source of funds
 Legitimacy of the business
 Accounts with details of facilities with other banks
 Area of residence
 Residence status whether owned, rented etc.
 Overall background
 Any other information

For An Organization:
This is list of documents that require in account opening for an organization:

 Check all necessary documentation as mentioned in the manual has been obtained and all
necessary formalities of account opening have been completed.
 Obtain brief profile of the partners, directors etc. to ascertain their credibility.
 Take adequate measures to obtain all relevant information i.e. independent verification of
the partners, directors etc. and the organization.
 Obtain a report from the customer’s other/ previous bankers
 Clearly understand the pattern of transactions to be conducted by the organization.

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  Make possible efforts to gather information relating to the customer’s source of wealth to
ensure that business is transacted only with customers of repute involved in legitimate
business activities.
 Account opening officer/ manager operations/ branch manager should personally meet the
key individuals of the organization and conduct their due diligence.

Account Opening Form:

A senior officer should be designated by the branch manager to handle the account opening
function. Prior to opening of the account, the account opening form and all the related documents
must be scrutinized and approved by the branch manager personally. It must be ensured that all
columns of the account opening form are correctly & properly filled and the customer has read &
understood Rules & Regulations for conduct of accounts that are printed on the reverse of the
account opening form. No column of the form should be left blank and columns not applicable to
a particular customer should be marked so to guard against unauthorized additions. Following
guidelines must be followed in this regard:

 Title of account must be in block letters and it should corroborate the name on the National
Identity Card/Passport.
 The type of account i.e. Current, PLS or Term must be clearly mentioned.
 The status of the account holder i.e. Resident or Non-Resident must be specifically marked.
 The currency in which the account is to be opened must be specified.
 Full name of the customer along with the father’s/ husband’s name, NIC number/ Passport
number, place of birth, NTN, occupation & occupational details including occupational
address (the occupation must be clearly and specifically defined, vague terms such as
business, trading, service etc. are insufficient, the extract nature of the occupation or the
place of employment must be ascertained and recorded) personal communication details &
details of Next of Kin, as applicable must be recorded.
 Instructions for deductions of Zakat must also be noted on the AOF.
 Any other instructions such as holding of mail etc. must also be mentioned on the AOF.

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  Terms of operation of the account whether singly, jointly, by either or survivor or jointly
by any of the authorized signatories of the account must also be noted.

REGULATION:

State Bank of Pakistan Regulation M-1 of Prudential Regulations for Corporate/ Commercial
Banking relates to Account Opening and thus it has been made an integral part of the this Manual
as Annexure ‘IV’.

STATUS OF CUSTOMER

RESIDENT:
A resident would mean any person residing in Pakistan and holding a Pakistani
Nationality or an expatriate having a valid permit for residing in Pakistan or an employee of a
consulate of a Foreign Country or firms which are incorporated abroad but operate in Pakistan or
a Judicial Entity licensed to operate in Pakistan.

NON-RESIDENT:

Individual firms and companies resident in countries outside Pakistan are designated
as Non-Resident. All Pakistani Nationals and persons domiciled in Pakistan except persons
holding office in the service of Pakistan who go out of Pakistan for any purpose viz., employment,
study, business, pleasure etc. are treated as Non-Resident for so long as they remain outside
Pakistan and all such accounts are regarded as accounts of countries in which the account holder
is residing. Non-Resident accounts can be categorized as follows:

• Pakistani nationals permanently residing and domiciled abroad

• Pakistani nationals who are abroad for short visits

• Foreign nationals residing abroad

• Foreign nationals ordinarily residing in Pakistan but gone abroad for short visits.

Where an account of a resident is held jointly with a Non-Resident, it shall be treated as a Non-
Resident Account.

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DOCUMENTS REQUIRES
I practically saw all the necessary documents which are required for opening of Account.

Individual Account:

There are the list of documents that require in individual account:

 Copy of CNIC/NICOP/POC
 Any job /business proof (if applicable)
 Attested copy of service card should be obtained in case of salaried person.
 For illiterate person his\her photograph and thumb impressions on the specimen signature
card must be obtained.

Students Account

All the documents which are necessary for the Individual Account that are same for the students
Account but a little bit documents are different that are:

 Student’s ID card
 Copy of the B form
 And copy of the Guardian

For Limited Company Account

This is list of documents that require in account opening for limited company:

 Copy of Certificate of Incorporation

 Memorandum & Articles of Association
 Board Resolution
 Latest copy of Certified Form-29
 List of Directors
 Copies of CNICs of all Directors Certificate of Commencement of Business (for Public
Ltd co).

Partnership Account

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This is list of documents that require in account opening for partnership account:

 Partnership Deed (certified copy)

 Letter of Authority & Mandate
 Copies of CNICs of all partners
 Account Opening Request.
 Proprietorship account
 Copy of CNIC.
 Copy of NTN Certificate
 Account opening Request & Proprietorship Letter

Club / Society / Association and Trust Account

This is list of documents that require in account opening for club/ society/ association and trust
account:

 Copy of Rules / By-laws

 Copy of Registration (if applicable)
 List of Executive Members / Management committee/ Management Board etc.
 Certified copy of Resolution CNICs of all members of Management Body

Issuance of Cheque Book:

Customer requires a cheque book after opening an account to conduct operations. To have cheque
book customers shall apply for it.

Reissuance of cheque book:

When two or three leaves are left then customers can demand for a new cheque book. Customer’s
fills a slip which is attached with existing cheque book and receives a new cheque book from
banker in two to three days.

Loss of cheque book:

In case customer has lost his or her cheque book then customer should stop payment first step
should best of payment of all cheques. Next step should be issuance of a new cheque book

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HOW TO CLOSE AN ACCOUNT

The customer can close the account. The customer is required to submit an application for closing
the account. Then the account is closed out and his balances paid to him after deducting the Closing
charges i.e. Rs.200 and the applications filed in Account closing file. Cheques book is returned
back to bank and the officer cancel and the remaining cheques in cheques book.

2. REMITTANCE DEPARTMENT

Transfer of funds from one place to another place can be done through mail transfer, instrument
transfer and electronic transfer. This department provides services to the customers of the bank.
Transfer funds are main function of this department. Instruments handled by this department are
demand draft, telegraphic transfer, mail transfer, pay order, pay slip. Remittance can be made
through mail transfer, electronic transfer and instrument transfer.

DEMAND DRAFT:

Demand Draft (DD) and Pay Orders (PO) are issued to customer on request by bank. Demand
Draft is issued by one branch and paid by the other branch of the same bank or different bank. The
stock of Demand Draft and Pay Order is being supplied from head office must be recorded in
stationary register and kept in locker. Draft book and pay order book in use should be kept in
locker overnight. At the end of day issued DD and PO should be verified with register that all
entries have been made and in the next morning officer must check the DD and PO with reference
to the previous day last leaf.

PROCEDURE:

 Before issuing demand draft the officer must ensure that that the amount and service
charges for are received.
 Application form is given to the customer to fill it and sign it.
 Officer of remittance department checks the information and sign it. Cashier checks the
amount and service charges.

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  Entry is made in DD register and instrument is given to customer.
 Posting of DD and vouchers is made into system advises are printed and mailed to the
concerned branch
 If any concession is allowed as army officers do not have to pay any charges then
commission is not collected.
 Finally entry is made in register as DD payable Nil.

When DD is received payment is made an entry of Branch Dr. and DD payable Cr. is made.

Unclaimed DD:
Amount of unclaimed DD is transferred to head office as a bank draft is valid for six months from
the date of issuance.

Cancellation of Demand Draft:

Purchaser of demand draft can request to cancel it in such case charges should be deducted and
payment of DD should be stopped.

Safeguards to be followed:

Safeguards should be followed while writing the amount in figures or words no gap should be left
between the words. Notion (/-) should be used at the end of amount. There should be no alteration
or overwriting if any should be attested with signature of customer. Instrument should be crossed.
Reverse carbon must be attached.

PAY ORDER:

Pay order issued by one branch is payable from the same branch. It is used for the payment within
city. It is like banker’s cheque payable locally. Procedure of its issuance is:

 Get the application form from remittance officer.

 Fill the form, sign it and attach necessary documents.
 Charges are applied then cost memo is signed and given to customer
 Entry is made in pay order register and a voucher is made and posted on computer finally
customers account is credited or cash is paid.

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  Should be crossed “payee’s account only” with stamp.

In case of Payment

PAY IN SLIP:

This instrument is used by bank for its payment. No other bank is involved. Branch is itself issuer
and payer. No excise duty is charged and procedure of issuance and payment is same as pay order.

TELEGRAPHIC TRANSFER:

In telegraphic transfer request is received from customer to make telegraphic transfer by account
debit or by receiving cash. It is the fastest way of transferring money.

Issuance:
Request is taken on a printed form and is given to customer to fill it and sign it. Then a neat TT is
made with three copies of it one for branch second for Head office and original is faxed to
respective branch and charges are received.

Received:

When a TT is received then test numbers and signatures should be checked. Entry in TT payable
register is made and recorded into system as Head Office Dr. TT payable Cr. and TT payable Dr.
Customer Account Cr.

F.D.D and F.T.T is used to conduct foreign remittances. Foreign Exchange department of Askari
bank limited is equipped to deal with such needs of customers.

MAIL TRANSFER:

When a customer requests the bank to transfer his money from this bank to any other bank or the
branch of the same bank in the city/ outside the city or outside the country, the first thing he has to
do is to fill an application form in which he states that I want to transfer the money from this bank
to another bank. If the customer is the account holder of bank, then the bank will debit his account.
The concerned office will fill the different forms to make the mail transfer complete. Three forms
used for this purpose are listed below:

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  Debit voucher
 Credit voucher
 Mail transfer register

If the customer is not the account holder of bank, then firstly he has to deposit the money and then
the above said procedure will be adopted to transfer his money.

3. CLEARING DEPARTMENT:

Clearing department is concerned with a system by which banks exchange cheques and other
negotiable instrument drawn on each other within a specific area and secure payment for their
clients through the clearing house at specified time. The word clearing has been derived from the
word “Clear” and is defined as “ a system by which banks exchange cheques and other negotiable
instruments drawn on each other within a specific area and thereby secure payment for their clients
through the Clearinghouse At specified time” in an efficient way”.

 Since clearing does not involve any cash etc. and all the transaction take place through
book entries, the number of transaction can be unlimited.
 No cash is needed as such the risk of robbery, embezzlements and pilferage are totally
eliminated.
 As major payments are made through clearing, the banks came manage cash payments at
the counters with a minimum amount of cash in vaults.
 A lot of time, cost and labor are saved.
 Since it provides an extra service to the customer of banks without any service charges or
costs, more and more people are inclined and attracted towards banking.

CLEARING HOUSE

It is a place where representatives of all banks sit together and interchange their claims against
each other with the help of controlling staff of State Bank of Pakistan and where there is no branch

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of State Bank of Pakistan the designated branch of National. Bank of Pakistan act as controlling
member instead of State Bank of Pakistan.

Through NIFT clearing is made either Intercity or within city clearing lets understand what NIFT
is and how it is working:

NIFT - National Institutional Facilitation Technologies NIFT

National Institutional Facilitation Technologies (Pvt.). Ltd. was incorporated in September 1995
as joint venture between a consortium of six banks and entrepreneurs from the private sector. All
commercial banks and all of their branches in major cities avail NIFT’s services. As of May 2009,
40 commercial banks and their 5571 branches in 185 major cities, 20 data centers utilize NIFT’s
services.

NIFT has setup elaborate data centers geared to provide automated services for document
processing particularly in the payment arena. Modern image based facilities have been established
at Karachi, Lahore, Islamabad, Peshawar, Rawalpindi, Hyderabad, Multan, Faisalabad, Quetta,
D.I.Khan, Sialkot, Gujranwala, Sukkur, Bahawalpur, Muzafarabad, Jhelum, Abbottabad, Mirpur,
Sahiwal and Sargodha. The services include cheques clearing, reconciliation, ‘return’ (unpaid)
cheques processing, same day clearing (express – 2 hrs. clearing service), intercity clearing and
inter branch & interbank settlement. Services are provided at individual branch level to over 5571
branches in 184 major cities and smaller cities.

NIFT Rider

NIFT riders come in a bank (Branch) twice in a day for inward and out ward clearing Cheques &
instruments for collection and delivery at specified time.

MEMBERSHIP CEASES

 It ceases to be a scheduled Bank.

 It is not able to meet its liabilities.

State Bank of Pakistan or Central Govt. prohibits it to receive fresh deposits.

TIMING:

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(Monday through Friday)

i. 1st Clearing at 10:00 a.m.

ii. ii. 2nd Clearing at 3:30 p.m.
Each bank will send competent representative to exchange the cheques.

OUTWARD CLEARING AT THE BRANCH:

The following points are to be taken into consideration while an instrument is accepted at the
counter to be presented in outward clearing:

i. The name of the branch appears on its face where it is drawn.

ii. It should be stale or postdated or without date.
iii. Amount in words and figures does not differ.
iv. Signature of the drawer appears on the face of the instrument.
v. Instrument is not mutilated.
vi. There should be no material alteration, if so, it should be properly authenticated.
vii. If order instrument suitably indorsed and the last endorsee’s account being credited.
viii. Endorsement is in accordance with the crossing if any.
ix. The amount of the instrument is same as mentioned on the paying-in-slip and
counterfoil.
x. The title of the account on the paying-in-slip is that of payee or endorsee.

If an instrument is in order than bank special crossing stamp is affixed across the face of the
instrument. Clearing stamp is affixed on the face of the instruments, paying-in-slip and counterfoil.
The stamp is affixed in such a manner that half appears on counterfoil and paying-in-slip. The
instrument is suitably discharged, where a bearer cheque does not require any discharge and also
an instrument in favor a bank not need be discharged.

The instrument along with pay-in-slip is retained while the counterfoil is given to the customer
duly signed. Then the following steps are to be taken:

i. The particulars of the instrument and the pay-in-slip entered in the outward clearing
register.

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 ii. Serial no. Is given to each instrument.
iii. The register is balanced; a regular report is generated after entering clearing
instruments in the software. Balance of report compare with manual register balance to
avoid omission.
iv. Then a particular voucher is filled with total amount of Clearing.
v. All instruments with grand sum voucher put into a bag.
vi. NIFT rider come and takes bag for out ward clearing.
vii. For inward clearing bag reached at morning in the branch.

However the amount is kept in float till final status of various instruments is known from
respective paying banks in second dealing.

The entry of the instrument returned unpaid is made in Cheques returned Register. If the
instrument is not to be presented again in clearing then a covering memo is prepared. The covering
memo along with returned instrument and objection memo is sent to the customer who sent the
same to his account.

INWARD CLEARING OF THE BRANCH:

1. The particulars of the instruments are compared with the list.

2. The instruments are detached and check the corresponding account if balance is available
then Debit the account.
3. Floating status is now realized at corresponding branch which send instrument for clearing.
4. Crossing stamps, clearing stamps and endorsement are checked.
5. Crossing stamp other than collecting bank is cancelled. Cheques& instruments are posted
to the debit of respective accounts.
6. Any instruments returned un-paid shall be returned in the second session of the
clearinghouse i.e. 2nd clearing.
7. Cheques & instruments if un-paid are returned along with return memo.
8. IBCA’s for net amount is sent to the main branch

Inward Cheques Returned Unpaid:

These are the cheque returned unpaid by AKBL in inward clearing due to some objections.

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Out Ward Cheques Retained Unpaid:
These are the cheques retained unpaid to AKBL which were lodged by other Bank because of
some objection e.g. Insufficient balance.

SPECIAL CLEARING:

In addition to the normal clearing function at Clearing house it is mutually agreed to hold an extra
clearing at the clearing house on the particular day and time which is known as “special clearing”
it is arranged due to the rush of work arising out of say, more Holidays declared by the Central
Govt. at a time, but normally special clearing is held on last working day of our half yearly and
yearly closing i.e. 30th June and 31st Dec. every year.

4. ACCOUNTS DEPARTMENT:

Accounts department is a department which deals with all the activities of all the departments of
bank. Daily transactions are recorded on computer its function is to get summary of all credit and
debit transactions and vouchers for record purposes. It deals and checks all the working of bank
such as checking bank’s daily activity, preparation of statements, and calculation of depreciation,
reconciliation and salaries payment. All vouchers are scrutinized at the end of day and computer
prints are received. Next day activity is separated vouchers are sorted out head wise and matched
with entries in subsidiary ledger and immediately deal with abnormalities if any. Also maintains
books of accounts of head office and arrangement of stationary for bank. Do pre audit checking
also deals with external audit reports and state bank of Pakistan instructions.

Activity Checking:

 Checks all the debit and credit transactions and vouchers of the branch and in case of errors
send them back to concerned department for correction.
 Maintenance of Budget and stationary:

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  Maintain the record of daily expenses of bank. If expenses are not routine then approve
those expenses from head office. Stationary record is maintained with consumed stationary
and left over.

Statement of Condition:

Prepares statement of condition on daily basis and files it. Some other tasks performed by this
department are:

 Calculation of Depreciation.
 Approval of medical allowance from head office to facilitate employees and their families.
 Reconcile discrepancies.
 Correction of accounts according to auditor’s instructions.
 Salaries payment to staff

5. CASH DEPARTMENT:

Physical movement of cash in bank is made through cash department. Cash department performs
the functions of receipts which include cash deposit by customers, payments against cheques, act
according to standing instructions, and transfer funds from one account to another, verifications of
signature, posting, ATM handling and handling of prize bonds. All banks are required to follow
the instructions of state bank of Pakistan regarding cash management such as branches are required
to prepare on daily basis a statement of closing cash balances. Branches are required to maintain
minimum surplus cash balance on daily basis. Special teams of state bank will pay surprise visit
to the branches to examine the quality of currency being issued by the banks

The main function of this system is Receipts & payments to the customers, on behalf of their
account, through Cheques or any other negotiable instruments. All those transactions, which are
held on the counter on cash basis lies under the cash department. The cash system mainly deals
with following areas:

 Receipts

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  Payments

The cheque can be returned to the customer due to following reason:

 If the cheque is postdated; i.e. some future date is written on it.

 If the date is of 6 months back.
 If the amount in figure and words is different.
 If any cutting is made on the cheque.
 If the cheque is of other branch of AKBL then it will send to bill department. And if the
cheque is of BWP branch of other bank then it will send to clearing department.

Transfer of Cheques
If one account holder wants to transfer some amount from one account to another, then he will
give the cheque favoring the other account holder and also fill the pay in slip. The cashier after
checking the details and enter in the register transfer to the officer. The officer transfers the
mentioned amount from one account to another.

Calculation of Ending Cash Balance

 The official time for receiving deposits and payments is till 5 pm. However some important
customers is accommodated afterwards.
 The cash in hand is counted. It contains the cash at the counter and cash in the strong room.
 The opening balance is taken i.e. ending balance of previous day
 The receipts are added
 The payments are deducted
 This daily cash position is written down on daily cash position book.

6.2. ACTIVITIES OF INTERN:

Starting and ending dates of my internship

Starting date: 31-07-2018

Ending date: 17-09-2018

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 During my internship I was involved in different departments.

I. Account opening department

II. Remittance department
III. Clearing department
IV. Accounts department

1ST WEEK:

I started my internship with the introduction of bank employees and with the bank departments.
They gave information about bank that how they work, what is the function of AKBL and how did
perform this function efficiently. I learn that what the purpose of the bank is. I also learn basic
things of the bank.

I assist MR. Raza who is the incharge of account opening. He told me about the AKBL’s product.
What type of service the bank provide to customers. What type document require to open any kind
of account. I performed these operations:

 Customer dealing to attract them through providing the information related to the bank and
accounts.
 Filling the forms for opening the accounts (Individual Account).
 The S.S card and the application form is verified and the verification stamp is imposed on
it.
 Record the account open into their specific register.
 Fill vouchers for cheque book issuance.
 Issue cheque books to customers
 Maintain the record of cheque books in register
 I also fill the CDR’s form and record in register.
 Fill deposit slips

2ND WEEK:

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In 2nd week, I assist MR. Zohaib Ahmad who is the incharge of clearing. He told me about
clearing. Types of clearing and how to process the clearing operation in bank.

Two types of clearing

1. Inward clearing
2. Outward clearing

When AKBL receive inward clearing AKBL have to debit customer account and when AKBL
receive outward clearing AKBL have to send it to relevant bank for payment.

I performed these operations.

 Record the inward clearing cheques in clearing register with cheque number, bank name
and accountholder name.
 Record outward clearing cheques and cheque returns in clearing register with cheque
number, bank name and account holder name.
 Attached deposit slips with clearing cheques.
 Record the amount clearing cheques on computer
 Three Stamps imposed on clearing cheques are clearing stamp, signature verified and UV
scanned.
 After these procedure the cheques sent to NIFT.

NIFT verify these cheques if they verify then they sent to their banks if not then the cheques return
tithe bank. I also learn about intercity cheques.

3RD WEEK:

In 3rd week, I assist MR. Zohaib he told me about different instruments and which should be used
according to customer’s requirement and how to fill these instruments.

 A pay order is a mode of payment that is to be cleared in the very specific branch of the
bank that issued it.
 Demand draft is a mode of payment that gets cleared in any branch of the issuing branch.

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  I filled the pay order forms. And I also fill vouchers and imposing stamps on it.
 Work on register entering the payment of Pay order.
 Supervisor told about the method of filling the form of demand drafts
 Payment of Demand Draft and pay order after checking that it will be paid or not and take
signature of the customers.

4TH WEEK:

In 4th week, I assist MR. Faisal Saeed who is the incharge of accounts he told me about that
accounts play a major role in bank. Accounts department is very important in maintenance of
financial records and he check the financial performance.

I performed these operations:

 The daily activity is that to check debit and credit vouchers.

 Maintain the register of vouchers.
 Filing the documents.
 How to check statements of customers.

5TH WEEK:

In 5th week, I again worked under the Mr. Raza Asif who is the incharge of account opening. And
branch manager give me a task to call customer’s and inform her that your cheque books and ATM
cards delivered in bank and now you receive your cheque books and ATM card from bank. And I
also worked in different department like account department, clearing department.

6th week:

In 6th week, I am doing same work in different departments but in this week I am sitting on the
seat of CSO. I have filling deposits slips when customers are coming for withdraw and deposit
money. And deal with different customers and this thing will gave me confidence that how you
deal with customers efficiently.

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CHAPTER # 7
PROBLEMS AND
RECOMMENDATIONS
 Problems

 Recommendations

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 7.1. PROBLEMS:

1. I have found that all employees do not guide internees. The employees not tell about the
functions and how perform. Internees have no permission to use systems of AKBL. That’s
why the internees not get full information and not learn that how work practically.
2. Understanding and the effective management of the human resources is the most difficult
challenge faced not only by the bank but by all the organizations. Even though the people
have been sacrificed in the new organizational developments, it is becoming clear that the
true lasting competitive advantage comes through human resources and how they are
managed. AKBL seems to not focusing on this highly critical issue as the job satisfaction
level of the employees working at AKBL, was quite low.
3. The employees are constantly rotated from one job to another job of totally different
characteristic in the view of giving them the know-how of the working in all the
departments. But I think this is not a very good tactics used by the management. Otherwise
the situation might be like this ‘Jack of all and master of none.’
4. There is a high degree of centralization in the bank. Almost all the decision-making is in
the hands of the upper management. But centralization is effective up to a certain level
otherwise it becomes inefficient and at times costly too. I personally observed that delay
occurred in the operations of the employees only due to the fact that they had not got any
instructions from the head office.
5. During my internship at Askari bank limited I feel branch was lacking of some facilities
like limited employees, advanced technology, sometimes the cheque books and ATM’s
late delivered.
6. Employees and staffs are not fully trained and even they don’t know properly about the
software’s and the technology the bank used. There is no formal training sessions and
nobody can help new employees in their work.
7. Bonuses and incentives not provided by banks to the employees if they achieve goal. When
the employees not get bonuses or incentives as the result of hard working, in the next time,
the employees not work and feel work as burden. That’s why banks performance goes
down.

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8. There is limited employee and work burden is high that’s why the employee not perform
well. In AKBL, the employees perform different functions at a time. Account opening
incharge handle account opening, CDR’s and E-Statements at a time. Bank needs to hire
new employees.
9. The bank not effectively used electronic media for promoting the products of Askari bank.
The bank need to use different sources for advertisement like social media, electronic
media.

7.2. RECOMMENDATIONS:

1. There is a need for expansion of the working area especially in the finance department as
the work load is increasing and new recruitments are compulsory. Because work load are
increased and employees not perform well.
2. Askari bank’s management needs to provide up to date facility each branch. The AKBL
needs to check that every bank have up to date facility or not.
3. The employees should be given more incentives and Rewards for their good performances.
If the bank give bonuses or rewards then employees motivate and perform well in market.
4. There should always be innovation in any business to flourish and there is a lot more to
explore in the banking sector and its always first come first served. The bank needs to
introduce new products and services according the customer need.
5. The fresh hiring should be made permanent so that they are secured of their future. Further
the allowances and perquisites attached with the permanent jobs will also increase the
motivation level of the employees.
6. The bank should place emphasis on the organization of effective training and development
programs for its new as well as existing employees so that these are gradually updated
regarding the recent developments in the field of banking. The present conventional and
orthodox training programs need to be made more comprehensive and reinforce with
inclusion of computer training process

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7. The current bank system used by the bank is very slow in processing so my view is that the
bank should try to adopt some other but more effective form of technology in order to
provide comfort to the customers as well as the staff.
8. To improve the services and to remove the problems of customer by making a spread
customer complaint department. AKBL needs to introduce new department or a complaint
box. If any customer have any problem regarding AKBL service or products then they
complaint about this.
9. HR department is very important in bank because HR department motivate employees to
work efficiently and bank provide promotion for these types of employees who work
efficiently. The importance of manpower cannot be denied in any organization. In case of
banks it is the most valuable asset, because the bank is most sensitive organization and to
be in harmony with this sensitivity, need for proper human resource is felt badly.
10. Delegating powers to the department in-charges up to the possible extent will most
certainly reduce the workload on the managers and they would be able to perform well by
taking quick remedial actions where necessary. Besides, the spare time will be spent
dealing with matters of more important nature.
11. Banks should confirm that the provided figures by borrowing organizations are fairly
audited and that the auditors are on the approved list of the bank and they have clear opinion
about the affairs of company and nothing has been made secret.
12. A large number of industrial units and projects became sick because of poor management.
When a business become sick or fails it is unable to return the loans, it has taken, and as a
result such loans become bad debts, to avoid this, it is the responsibility of AKBL, to ensure
that the company to which loan is sanctioned enjoys good management skills and
reputation.
13. Branch manager and employees need to provide proper guidance to internees. Some
manager and employees not give information about anything and they are busy in their
work.
14. AKBL needs to launch new effective advertisements and bank advertise in electronic or
social media. New advertising campaigns should be launched especially in the electronic
advertisement areas.

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CONCLUSION

Bank performance is good as look its age because it has to cover long distance to become first
choice for customer in the banking sector. During policy formation must keep in mind that how
customer will involve with the policy and what kind of benefits and problems have to be faced by
the customer through this policy.

Overall bank performance is good but the bank also need to improve in different sectors like
marketing, foreign trade etc. New products & Services will have to be introduced in the bank by
analyzing the customer needs and market demands which will build the image among the
customers. The bank needs to adopt different technology to gain competitive advantage and the
advantage used efficiently to earn or maximize profit. If the bank gain competitive advantage then
the bank has lot of potential to become a leader in the banking sector.

Banking sector has adopted new techniques with the passage of time in order to compete in this
world. AKBL is one such bank that is successfully operating in its field. A system of regional
management is in place to ensure the improvement in productivity. They are alive to the
expectations of the customers. It is moving towards its goals. It has won many awards in the
banking world. It achieves its target and playing active role in social sector as well. It is
successfully creating the relationship with the nation. To capture more market share bank has to
be introducing new facilitation plan for the customer satisfaction. Hire more employees to work
effectively. The performance of the bank is improving with the time. Its profitability has shown
improvement over years, but still it requires improvement in profitability, infrastructure and
technology. The bank aims at a prosperous future by “inspiring relationship” and work for the
betterment.

REFERENCES

https://www.slideshare.net

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https://www.scribd.com

http://akbl.com.pk/

http://akbl.com.pk/wp-content/uploads/2018/03/Askari-Bank-Annual-Report-2017-Final.pdf

https://en.wikipedia.org/wiki/File:Askari_Bank_logo.svg

http://docshare.tips/internship-report-on-askari-bank-limited

https://vdocuments.site/internship-report-on-askari-bank

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CHAPTER # 8
LIST OF ANNEXURE

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