MBA INTERNSHIP REPORT ON

SONERI BANK
SPECIALIZATION IN HRM

Submitted by Muhammad Ehsan Roll No. J5697279 House No. 1646 Raffi Road, Lalkurti (Tariq Abad) Rawalpindi

Department of Business Administration Allama Iqbal Open University Islamabad

Table of Contents
SUBMITTED BY ...............................................................................................................................................................1 MUHAMMAD EHSAN.......................................................................................................................................................1 ROLL NO. J5697279.....................................................................................................................................................1 HOUSE NO. 1646 RAFFI ROAD, LALKURTI (TARIQ ABAD).................................................................................................1 RAWALPINDI..................................................................................................................................................................1 TABLE OF CONTENTS....................................................................................................................................................2 ACKNOWLEDGEMENT..................................................................................................................................................2

PREFACE

Getting practical knowledge in one of the major aims of MBA program. Department of Business Administration Allama Iqbal Open University, Islamabad has followed policy of assigning different practical assignments to its students so a touch of real working environment can be given to the students apart from classroom studies to widen their perspective. This internship report consists of two findings to work in the different departments of bank and gathered useful information from different sources.

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ACKNOWLEDGEMENT
All prays goes to Allah almighty. To write an acknowledgement after the completion of an enormous task as always been more enormous than the task itself. But with the firm determination and noble passion of hard working, nothing remains difficult. I am grateful to our honorable Chairman who assigned me this report, which would be very helpful for my future in practical life. I gain a lot from this interesting earning job. I want to thank all those personalities, who have been a source of guidance during the Internship. I acknowledge them with thanks for their help. My deep gratitude also goes to Soneri Bank Limited management. Qamar Azeem M. Ikram Zaffar Iqbal (SEVP) (Branch Manager) (Operations Manager/AVP)

Needless to say that all shortcoming of this report will remain my responsibility.

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EXECUTIVE SUMMARY

The banking structure in Pakistan comprises of the following types, State Bank of Pakistan, Commercial bank of Pakistan, Exchange Bank, Saving Bank, cooperative banks, specialized credit institutions. SONERI BANK LIMITED Incorporated on September 28, 1991 the first branch of Bank formally opened doors for operations in Lahore on April 16, 1992 followed by Karachi Branch on May 09, 1992. The bank now operates with 118 branches spread all over Pakistan including the Northern Areas of the country where no other private bank has ventured so far. Expansion of branches is based on a policy of maintaining a balance between the urban and rural areas with a view to offering services even in the remote areas of Pakistan. In six week internship program, I have worked in different departments like General banking, trade department and credits department. I have learned about the banking from experienced managers running these departments. This report contains the information about SBL that I have gathered during my six weeks internship period. This report basically deals in General banking, trade and credits where I worked. The bank is using SWIFT for transfer of information about imports and exports. SBL basically cover three departments like General Banking Department, Trade department and credit department. To open an account the customer has to meet Operations Managers with an introducer. The introducer must have an account in bank, or introducer might be the employee of the bank. Soneri bank strictly followed the account opening procedure. The bank cant open an account of customer before the verifications comes from NADRA. SBL has different types of account like, Basic Banking A/C. Current account, PLS and Soneri PLS A/C. They store all the information of their customers in data base. After entering data, they assigned customer an ID is known as Customer Relationship Management ID. He told me with the help of this ID their different branches can easily get information about customer account.

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In clearing and remittances section they have very efficient system. They clear the cheque through NIFT (National Institute of Facilitation Technology) where SBP exits. In remittances they told me about T.T D.D. and pay orders. Now people prefer D.D instead of T.T. D.D is a banker instrument and draft used for outside the city. It is valid for six month. Bank use pay order, when the payment is to be made with in a city. In corporate finance the bank deals only worthy enough industries. In consumer finance bank management always try to satisfy them. Bank offer different products for its customers like Ghar Finance Car Finance Generator Finance Soneri personal finance

At the end of this report, on the basis of my observations during internship, financial analysis and SWOT analysis of SBL is provided. Suggestions are also recommended as per learning from analysis. This report will provide better and comprehensive learning about Soneri Bank Limited

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HISTORY OF BANK SONERI BANK LIMITED Incorporated on September 28, 1991 the first branch of Bank formally opened doors for operations in Lahore on April 16, 1992 followed by Karachi Branch on May 09, 1992. The bank now operates with 118 branches spread all over Pakistan including the Northern Areas of the country where no other private bank has ventured so far. Expansion of branches is based on a policy of maintaining a balance between the urban and rural areas with a view to offering services even in the remote areas of Pakistan. Pleasant and sophisticated atmosphere has been provided in the branches which are all fully air-conditioned and computerized. The bank is looking forward to attain growth through activating the areas of SMEs and Agriculture credits. The Pakistan Credit rating Agency Limited (PACRA) has maintained banks credit rating at AA- for long term and A1+ for the short term and A+ for the Term Finance. Certificates reflecting banks well maintained risk profile with preserved sound asset quality. We take this opportunity to thank the Ministry of Finance and State bank of Pakistan their continued support and guidance. Soneri bank Limited is engaged in banking service, and operate more than 118 braches including four Islamic Banking Branches in Pakistan. The bank operates in four segment corporate finance, trading and sales, retail banking and commercial banking. Corporate finance includes syndicated financing and services provided in connection with mergers and acquisitions, underwriting, privatization, securitizations, debt, equity, syndication, Initial public offers (IPO) and secondary private placement. Trading and sale segment includes fixed income, equity, foreign exchange, commodities, credit, funding, own position securities, brokerage debt and prime brokerage. Retail banking segment includes retail lending and deposit, banking services, private lending and deposit, trust and estates investment advice and merchant/ commercial/ corporate cards. Commercial banking includes project finance, real estate, export finance, trade finance, factoring and leasing. The essence of our business philosophy is to cater to the banking requirements of small & medium sized entrepreneurs, providing them qualitative & competitive services with emphasis on encouraging exports. Nearly forty percent of our credit portfolio is related to export financing and credit decisions are taken within 48 hours that is why we say. Date of Establishment: September 28, 1991 Chairman Mr. Alauddin Feerasta Representative Officer Tasaduq Gardezi

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HEAD OFFICE: 87, Shahrah-e-Quaid-e- Azam, P.O. Box No# 49, Lahore Tel +92426368142 Fax+9242-6368138 Swift: SONEPKKALHR email. main.lahore@soneribank.com CENTRAL OFFICE 5th Floor, Al-Rahim Tower, I.I. Chundrigar Road, P.O.Box 5856, Karachi Tel: 021.2439562-67 Swift: SONEPKAXXX e-mail: info@soneribank.com

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Main branches in the different cities of the Pakistan

Region Lahore Karachi Faisalabad Peshawar Faisalabad Mirpur (Azad Kashmir) Quetta Islamabad Gujranwala Sialkot Rawalpindi Wizirabad Sheikhupura Hyderabad Multan Gilgit Sahiwal Skardu Hunza Lodhran Rahim Yar Khan Bahawalpur Gwadar Abotabad Okara Sargodha Hub chowki Golarchi Bohara Gujar Khan Jehlum Khanewal Booni Burewala Jati Town Hafizabad Number of Branches 23 43 2 2 1 2 2 3 1 1 2 1 1 5 3 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

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Nature of the Organization

Soneri Bank Limited offers a range of business for their customers; Retail Banking Corporate Banking

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RETAIL BANKING Refers to banking in which individual customers use local branches of larger commercial banks for their financial activities. Banking institutions execute transactions directly with consumers, rather than corporations or other banks. Services offered include; o Savings and checking accounts o Mortgages o Personal loans o Issuance of debit/credit cards o Certificates of deposit (CDs

CORPORATE BANKING Corporate Banking offers tailor made products / solutions as required by corporate customers which includes: o Funded facilities, ranging from short to medium and long term lending. o Trade related financing. o All sorts of non-funded facilities / services which include Cash receipts / payments, Remittances, Collections, guarantees, letter of credit etc. o Customized products / solutions. SBL covers cash management, foreign exchange, business-to-business payments, trust, custody, commercial lending, trade finance, and other corporate banking issues.

UNIQUE FEATURE Soneri Bank offered the following Unique services to their customers which are given below: Full range of corporate and retail banking services with special emphasis to provide qualitative and competitive services to small and medium entrepreneurs. Highly professional and efficient treasury operations and a world wide network of correspondents. A complete range of products for trade Finance, one of their core banking activities. Funds transfer services through On-Line banking and the bank own ATMs network, cheque-free banking and Soneri VISA Debit cards are just a few of their value added services.

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A wide range of attractive saving schemes to suit all segments of investors, Consumer finance Schemes and Islamic Banking products catering to the needs of a variety of consumers.

Future products include unique Investment plans under Banc assurance business in collaboration with M/s. New jubilee Life Insurance Company

BUSINESS VOLUME

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VISION STATEMENT
To provide quality services to its customers through adoption of best practices and full exploitation of I.T advancement, culminating at a leading position amongst its peer banks

Stronger banking relationships, increasing customer confidence

MISSION STATEMENT
To develop Soneri bank Limited into an aggressive and dynamic financial institution having the capabilities to provide personalized service to the customers with cutting edge technology and a wide range of products, and during the process to ensure maximum return on assets with ultimate goal of serving the economy and society. We have more time for you

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BOARD OF DIRECTORS Chairman Mr. Alauddin Feerasta Chief Executive Officer Mr. Safarali K .Lakhani Directors Mr. Noor Feerasta Mr. Inam Elahi Mr. S. Ali Zafar Mr. Abdul Hayee Mr. Shahid Anwar (NIT Nominee) Mr. Manzoor Ahmad (NIT Nominee) Audit Committee Mr. Nooruddin Feerasat( Chairman) Mr. S. Ali Zafar(Member) Mr. Shahid Anwar (Member) Mr. Abdul Hayee (Member/ Secretary) Company Secretary Mr. Abdul Hayee Legal Advisor Manan Associates, Advocates Auditors A.F Ferguson & Co. (Chartered Accountant)

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DEPARTMENTS OF SBL
General Banking Trade Department Credit Department

Introductions of the departments in which I worked as Internee In my first week in SBL, the branch manager Mr. Ikram assigned me to learn the basic banking concept. For this purpose he directed me to meet with the Operations Manager, Mr. Zaffar Iqbal (AVP). He is very cooperative kind of person. He told me about the rules and regulation that must be me followed by me and asked me to join Mr. Tasaduq Gardezi A/C opening (Officer). Account opening is a part of GENERAL BANKING. GENERAL BANKING Accounts Department Clearing Department Remittances Department Cash Department

General banking is divided in to four sections Account Opening Cash Clearing Remittances

ACCOUNT OPENING TYPES OF ACCOUNT OPENING FORM There are types of account opening form
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For single, sole proprietorship & joint personal For partnership, limited Company, trust, clubs etc.

BASIC REQIRMENTS FOR OPENING AN ACCOUNT FOR SINGLE, SOLE PROPRIETORSHIP & JOINT PERSONAL

CNIC photocopy. Introducer must have an account in the same branch. KYC. NTN certificate (for Sole Proprietorship) World Check. Letter Head in case of sole proprietorship

Note: The account of person will opened after receiving verification from NADRA. FOR PARTNERSHIP, LIMITED COMPANY, TRUST, CLUBS ETC FOR PARTNERSHIP Attested photocopy of CNIC of all partners Attested photocopy of partnership deed duly signed by all partners. Attested photocopy of registration of firm with registrar of firms. In case of partnership unregistered the fact should be mention in account opening form. Authority letter, in original, in favor of the person authorized to operate on the account of the firm. KYC. NTN certificate World Check.

TYPES OF ACCOUNTS Soneri bank is dealing in different types of account.

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Basic Banking A/C Current A/C PLS Saving Soneri Saving Fixed/ Term deposit A/C

BASIC BANKING ACCOUNT This is account is for salaried person account. Normally different companies, Schools, Colleges opened their employees account in this account. BENEFITS OF BASIC BAKING ACCOUNT ARE GIVEN BELOW: No Zakat deduction No service charges Soneri debit card

CURRENT ACCOUNT Current is a non profit account flexible account with a great convenience for individuals (in single or joints names), minors (to be operated by the guardian), charitable institutions, autonomous corporations, limited companies, firms, associations, educational institutions etc. Current account may be opened with any amount. SALIENT FEATURES Minimum Rs 10,000 required opening an account. Service charges will be deducted.

SONERI SAVING ACCOUNT Soneri savings account provides an opportunity to small and medium income group people, with an attractive return. SALIENT FEATURES Minimum Rs 5,000 required opening an account. No minimum charges.
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Zakat will be deducted. Up to Rs 100, 00 Expected profit 5% P.A. Soneri debit and credit card. Chequing Account facility with no limit on a number of transactions. Free Cash Deposit and Withdrawal facilities through your bank branch. Free clearing facility to deposit cheques of other banks within the city. Online Funds Transfer through Cheques to any account across Pakistan through your bank branch. Online Cash Deposit, Withdrawal and Funds Transfer through cheques from any of our branch across Pakistan.

PROFIT & LOSS SAVINGS ACCOUNT PLS saving Bank Account is a simple, straight forward saving bank Account with a great convenience for individuals (in a single or joint names) minors( to be printed by the guardians) charitable institutions, provident fund and other funds of benevolent nature local bodies, autonomous corporations, limited companies, firms associations, educational institutions, etc. the account may be opened with any amount; however accounts with balance below Rs.5000- on any day shall be subjected as per their schedule of charge in force. The PLS Savings Account entitle Account Holder to avail amazing facilities such as: Chequing Account facility with no limit on a number of transactions. Free Cash Deposit and Withdrawal facilities through your bank branch. Free clearing facility to deposit cheques of other banks within the city. Online Funds Transfer through Cheques to any account across Pakistan through your bank branch. Online Cash Deposit, Withdrawal and Funds Transfer through cheques from any of our branch across Pakistan. Remittance facilities such as Payment Orders, Demand Draft, Telegraphic Transfers and Free Rupee Travelers Cheques through your bank branch. Standing Orders facilities.

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(CRM ID) In (CRM) fill all the information of customer in their data base. After entering data, they assigned customer an ID is known as Customer Relationship Management ID. With the help of this ID their different branches can easily get information about customer account. CLEARING In clearing some important terminologies come, these are given below. and this is second most important part of general banking. Banker cheques Types of clearing IBDA OBC IBC NIFT Standing Instruction Daily Fund Transferring

BANKER CHEQUES In this cheque all the expenses of the bank are recorded on daily bases. Expenses like OCS charges TCS charges Stationary Classic water Utility Bills Generator Diesel

These expenses recorded in banker cheque. STANDING INSTRUCTION

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Standing instructions are given by the customer to the banker. In this cash will be transfer to second partys account according to the instruction given by the customer. Example If Customer instructs the bank if his children fee voucher comes, bank has authority to take these vouchers and pass the transaction, or any utility bills of customer etc. DAILY FUND TRANSFERRING In daily fund transferring the bank transfer the funds to customers main account where he wants. Example Uniliver has an account in different cities, like (Karachi, Multan, Lahore, Islamabad, and Faisalabad) .The Accounts manager of the company instruct the bank that banks should transfer their fund to their main account in Karachi. So HQ-Soneri Bank instruct their branches that they should transfer the funds of Uniliver to companys main account in Karachi. TYPES OF CLEARING There are three types of clearing. Normal clearing Special clearing Intercity clearing

NORMAL CLEARING Normal clearing is further divided into two types. Internal cheque External cheque

Internal Cheques:

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Internal cheques are given by the customer of the same branch. The clearing Department check the status of the account if the status of account would be OK, then they credited the account of the second party and Debited the account of their customer. External Cheques: External cheque comes from different bank to Soneri bank but from the same city. Theses cheques are delivered by NIFT. Clearing department check the status of the account. If the status of the account is ok, then they pass the transaction. In case of not they return the cheque to NIFT. Special Clearing NIFT delivered these cheques to bank and instruct the bank to transfer the amount to respected account. Bank is liable to pass the transaction according to the instruction given by the customer. Charges of special clearing are Rs.500. These charges charge by NIFT. And bank debited these charges from customer accounts. Inter Bank Debit Adjustment (IBDA) In IBDA always Head Office has right to debit the account of its branches. If there are some mutual expenses. So Head office sends IDBA note to its branch that they have debited their account. For example

Soneri Islamabad had sent request for UPS. Soneri Head Quarter has purchased the UPS on the behalf of Islamabad branch, and debited the account of Islamabad Branch with that amount.

UAN: Soneri has the UAN all over the country. The bill of UAN comes to HQ- Karachi. So HQ debited the account of all braches account according to their usage.

Outward Bills for Collection (OBC) OBC send by one bank to another bank, where State Bank is not exists. If a Soneri Bank customer received a cheque by a party of HBL- DG-Khan. Soneri Bank Multan sends OBC to HBL-(DGKhan) for clearing. If HBL (DG-Khan) clear the cheque they send clearing notice to Soneri Bank, then Soneri bank credited the account of customer.
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Inward Bills for Collection (IBC) IBC send by one bank to another bank, where State Bank is not exists. If one bank sends OBC to other bank, for other bank OBC would be IBC. If Soneri Bank Vehari received a cheque of Askari Bank Rawalpindi. They send the cheque to SBL-Mux, then Islamabad branch send the cheque in normal clearing to Askari Commercial Bank Rawalpindi. If ACB clear the cheque, then Soneri Bank send notice to Vehari Branch for clearing through DAK, and credited the account of customer. REALIZATION AND UN-REALIZATION There are three steps in realization of cheque in clearing. Shadow Realized Unrealized

SHADOW It just a record till the cheque is not clear. REALIZED Bank realized entry when it received a notice of clearing from other bank. UNREALIZED In case if cheque is not clear, then we unrealized the cheque and removed from the shadow REMITTANCES NEGOTIABLE INSTRUMENTS Cheque Draft on Demand Pay orders ATM Cards

Draft on Demand

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One party is not certain about other party. Then they requested for D.D instead of cheque. D.D minimizes the risk. D.D is the bankers instrument; bank issued the draft after verifying the status of account of party who is making this note in the favor of other party. After issuing the draft now its banks responsibility to pay the cash to the party. NOTE:

Draft used for outside the city Its validity six month.

PAY ORDER If one party is not certain about other then they requested for pay order instead of cheque. Pay order minimize the risk. Pay order is the banks instrument; bank issued the pay order after checking the status of account of party who is making this note in the favor of other party. After issuing the pay order now its bank responsibility to pay the cash to party. Pay order used within the city Its validity for six month.

ATM & CREDIT Cards Soneri Banking Card offers convenient and 24-Hours-a-day, 365 days a year access to ATMs across the country. When traveling within Pakistan, use the Card at Soneri Banks own network of ATMs and hundred of ATMs displaying either the 1-link or M-Net symbols. ELIGIBILITY: You can also apply for a Debit Card services. If you are having Soneri Banking Card, if you are maintaining a Soneri Bank PKR Current or Savings account Single or Joint account with either signatory authorized to operate the account, a further supplementary card can also be issued to the second account holder. All Soneri Banking Card holders use debit card facility. ATM ACCESS ACROSS ALL OVER PAKISTAN: Now cash withdrawals and Balance Inquiry services are available by any of the ATM in Pakistan. VALUABLE SERVICES: AT ALL ATMs Cash Withdrawal:
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You can withdraw cash from your account(s) up to Rs.25,000 per day in multiples of Rs.500, and Rs.1,000 currency notes. Balance Enquiry: You can see the available balance in your account displayed on the screen or obtain a printed advice AT SONERI BANK ATMS: Fast Cash: You can withdraw up to Rs.1000, 3000, 5000, 7000 and 10000 cash from your account(s). Mini-Statement: The ATM shall provide you with an instant mini-statement of your ATM linked accounts (declared by you on the application) listing 10 last transactions in the account(s). Request for Cheque Book: Request for fresh cheque book may be made through the ATM. The Cheque book may be collected from your branch after 3 working days against surrender of duly signed cheque book Requisition slip. Request for Statement of Account: Request for a detailed statement is processed at the push of a button. Requested statement shall be dispatched by your branch at your Registered Address within 4 working days. Pin Change: You may change the Personal Identification Number (PIN) through the own ATMs any number of times. Smart Option: Fund transfer Utility bill payments

Fund Transfer facility:

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You have the power to transfer money from your account to any account of Soneri Bank anywhere in Pakistan. CASH DEPARTMENT The following books are maintained in the cash department.

Receiving cashier books Token Book Paying cashier Book Scroll Books Cash Balance Book.

When cash is received in counter, it is entered in the Scroll book and cash receiving cashier book. At the close of the day these are balanced with each other. When cheque or any negotiable instrument is presented at counter for payment, its entered in the token book and token is issued to the customer. The token and cashier make entry in the payment book and after that payment is made to the payee. At the closing of the day, the token book and paying cashier book is balanced. The consolidated figure of receipt and payments of cash is entered in the balance book and drawn closing balance of cash. Opening Balance + Receipt Payments= Closing Balance This is very important department because cash is the most liquid asset and mostly frauds are made in this department, therefore , extra care sis taken in this department and no body is allowed to entered or leave the area freely. Mostly, cash area is grilled and its door is under the supervision of the head of that department. Officer checks the books maintained in this department. SUNDRY DEBTOR Sundry debtor is also known as suspense account. Bank maintains this account to meet the cash in emergency. Like if employee needs salary in advance due to some problem. Bank will advance him cash. But bank will deduct this amount at the time of paying salary to him.

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Some important point for SD At the month debit side must be equal to credit side. At the start of next month debit side and credit would be equal to zero. Any expense like TADA, and new branches expenses can be adjusted in this account.

TRADE DEPARTMENT Imports Exports

TRADE Trade department is further divided into two sections. Exports Imports

EXPORTS What is Letter of credit? Letter of Credit: Letters of credit are used primarily in international trade transactions of significant value, for deals between a supplier in one country and a customer in another. The parties to a letter of credit are usually a beneficiary who is to receive the money, the issuing bank of whom the applicant is a client, and the advising bank of whom the beneficiary is a client. Almost all letters of credit are irrevocable, i.e., cannot be amended or canceled without prior agreement of the beneficiary, the issuing bank and the confirming bank, if any. STEPS INVOLVED IN OPENING L/C There are following steps are involved in L/C After a contract is concluded between buyer and seller, buyer's bank supplies a letter of credit to seller. Seller consigns the goods to a carrier in exchange for a bill of lading.
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Seller provides bill of lading to bank in exchange for payment. Seller's bank exchanges bill of lading for payment from buyer's bank. Buyer's bank exchanges bill of lading for payment from buyer.

Buyer provides bill of lading to carrier and takes delivery of goods.

TYPES OF LETTER OF CREDIT There are two types of letter of credit that are given below. Revocable Letter Of Credit Irrevocable letter of credit

Revocable Letter of Credit L/C A revocable letter of credit may be revoked or modified for any reason, at any time by the issuing bank without notification. It is rarely used in international trade and not considered satisfactory for the exporters but has an advantage over that of the importers and the issuing bank. It should be indicated in LC that the credit is revocable. If there is no such indication the credit will be deemed as irrevocable. IRREVOCABLE LETTER OF CREDIT L/C: In this case it is not possible to revoke or amended a credit without the agreement of the issuing bank, the confirming bank, and the beneficiary. Form an exporters point of view it is believed to be more beneficial. An irrevocable letter of credit from the issuing bank insures the beneficiary that if the required documents are presented and the terms and conditions are complied with, payment will be made. Form-E It describes the details of the goods to be exported, the importers particulars, the amount of foreign currency payments and the details of the importer as well. Government has provided facility to exporter in taking Form-E from any bank and can present it to any bank for negotiation. Exporter proceeds realization certificates, SBP gives rebate to exporter against exporter after realization, it is paid according to commodity wise and bill wise. Claim period: 1 year Following steps are involved in Form-E.
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Firstly bank requested his customer to fill all the documents. After completing the documents send to Custom for clearing, and received custom clearing certificate

Then send the shipment to port. Lastly bank will send all the documents to issuing bank.

NOTE: Bank deals only in documents. Bank is not responsible for any damage. 100% margin required for opening L/C. with passage of if party developed understanding with bank. Then bank would give some kind of relaxation in Cash margin.

TYPES OF EXPORT Foreign Bill Purchase "An instant financial solution for exporters with payment on L/C, D/A, basis" To obtain a production continuity and to maximize every sources, Exporters should make the best of our Foreign Bill Purchase in FBP bank provide finances to exporter for given time period FORMAT OF (FBP) Tax1% Currier charges.1000 Export Development S (EDS) (FOB X 0.25) Invoice Freight = EDS: National bank collects the EDS tax and transfer to the government. HEDS80 FOREIGN DOCUMENT BILL FOR COLLECTION (FDBC) Foreign documents bills for collection. In this type of export, exporter bank charge commission to its client. In FDBC bank wont provide any kind of financing.
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(FOB* 0.25%)

Format of (FDBC) Tax1% Commission.. 0.1% Currier charges...1000 HEDS.80 EDS...........Invoice Fright= FOB FOB*0.25%................................................................FOB 0.25% HEDS: HEDS stands for Handling of export Development Supply. TYPES OF EXPORTS FINANCES There are two types of export finances. Pre-shipment Finances Post- Shipment Finances

PRE-SHIPMENT FINANCES Pre Shipment Finance is issued by a financial institution when the seller wants the payment of the goods before shipment. The main objective behind preshipment finance or pre export finance is to enable exporter to: Procure raw materials. Carry out manufacturing process. Provide a secure warehouse for goods and raw materials. Process and pack the goods. Ship the goods to the buyers. Meet other financial cost of the business.

The pre-shipment finance is further divided in to two types. FAPC

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PSL

FINANCE AGAINST PACKING CREDIT (FAPC) When customer facing financial problem, while delivering the goods to importer. Like packing expense and shipment charges. Then exporter requested his bank for (FAPC). Bank credited the account of his customer. When his bank received cash from importers bank. Exporter bank will deducted the FAPC and the rest of the amount will be credited to his account. PRE- SHIPMENT LOAN (PSL) Authorized dealers are permitted to extend Preshipment Credit in Foreign Currency (PCFC) with an objective of making the credit available to the exporters at internationally competitive price. Following advantages and important points of (PSL) This is considered as an added advantage under which credit is provided in foreign currency in order to facilitate the purchase of raw material after fulfilling the basic export orders. The rate of interest on PCFC is linked to London Interbank Offered Rate (LIBOR). According to guidelines, the final cost of exporter must not exceed 0.75% over 6 month LIBOR, excluding the tax. The exporter has freedom to avail PCFC in convertible currencies like USD, Pound, Sterling, Euro, Yen etc. However, the risk associated with the cross currency truncation is that of the exporter. POST- SHIPMENT FINANCES Post Shipment Finance is a kind of loan provided by a financial institution (Soneri Bank) to an exporter or seller against a shipment that has already been made. This type of export finance is granted from the date of extending the credit after shipment of the goods to the realization date of the exporter proceeds. Exporters dont wait for the importer to deposit the funds.

TYPES OF POST SHIPMENT FINANCES

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Foreign Bill Purchase (FBP) Finance Against Foreign Bill (FAFB) Foreign Bill Discounted (FBD)

FOREIGN BILL PURCHASE (FBP) After shipment exporter present all shipping document to authorized dealer (bank) and get finance. The bank will credited the account of his customer. When payment will received by importers bank, bank will adjust the account of customer and credit the bank account. FINANCE AGAINST FOREIGN BILL Bills can only be sent on collection basis, if the bills drawn under LC have some discrepancies. Sometimes exporter requests the bill to be sent on the collection basis, anticipating the strengthening of foreign currency. Banks may allow advance against these collection bills to an exporter with a concessional rates of interest depending upon the transit period. The transit period is from the date of acceptance of the export documents at the banks branch for collection and not from the date of advance. IMPORTS Imports start with Letter of credit. Information in L/C The name of the local company, which is importing the goods. The name of foreign company, which is exporting the goods. The details of goods to be transacted including the amount, quantity mode of packing etc. The total amount of L/C The numbers of the days fro which L/C is valid. The name of the bank, who is regulating all these dealing. The name of the carrier which will be used for the shipment of the goods t the importers. The bill of shipment number.
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Parties Involved In a Letter Of Credit There are normally six parties involved in L/C.

Buyer (known as importer or consignee) Buyers bank (known as opening or paying bank) Sellers bank ( known as advising bank or negotiating bank) Carrier (known as shipping company) Insurance company.

OPENING OF L/C For opening of L/C following documents are required by the bank. Application or bond Order or invoice or indent. Insurance Liability endorsement of customer Irrevocable documentary credit(LC)

An L.C is issued after opening of letter of credit it is sent to exporters bank. LC OPENING CHARGES: When an LC is opened, the bank collect certain charges from importer, these are; Commission postage charges telex charges

SWIFT It is network among all banks. No other institute can get involved in it. The swift system has been introduce speedy service in the area of home remittances. The system has built-in features of computerized test keys, which eliminate the manual application of test that often causes delay in the payments of home remittances. Swift is operational at Habib bank of Pakistan wit a universal

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access number SONEPKKAMTN. All Soneri branches and overseas correspondents are drawing remittances through SWIFT. DISCREPANCIES When issuing bank received document from advising bank. If bank found any discrepancies bank will inform his customer. If importer claim any objection, then issuing bank inform advising bank about discrepancies. TYPES OF IMPORT FINANCES

Finance Against Imported Merchandise (FIM) Inward foreign Bills.

FINANCE AGAINST IMPORTED MERCHANDISE (FIM) When customer facing financial problem, while lading the goods from port. Then importer requested his bank for (FIM). Bank credited the account of his customer. But pledge the merchandise as security. Bank charge the following charges to his customer. Commission FED. Markup

Bank charged commission 1%. Markup on the basis of number of days he used that amount CREDITS DEPARTMENT Consumer Finance Corporate Finance Agriculture Finance

CREDITS

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Soneri bank has divided their finance department into three sections, Finance officer told me about the types of finances. He said there are different types of financing. But Soneri has dealing in two types. There are two types of finances which are given below. Consumer finance Corporate finance Small And Medium Enterprises Agriculture Credits

CONSUMER FINANCE They give finance to their loyal customer. Who have good transaction record, and where the risk chances are less. Their mission is we have more time for you The consumer finance has different types of products. There products are given below.

Soneri car finance Soneri ghar finance Soneri personal finance Soneri generator finance

SONERI CAR FINANCE Purpose of Finance Purchase of brand new: Sanctioned finance must be utilized for brand new cars. No finance will be available for used or reconditioned cars. Un-registered cars for private use. Un-registered light commercial vehicles for private use.

Eligible Borrowers: Salaried person and the person who has well past record with bank can avail this opportunity. In case of salaried person he must be a permanent employee with minimum two years continued employment with present job employer. And employer must be financial institution, MNCs and Public limited company.
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Eligible borrowers are: Salaried Persons Self Employed Professionals Business Persons

Financing Amount

For Cars upto 2000 CC: Exceeding 2000 CC:

Rs. 1.0 Million For Cars Rs. 2.0 Million

Down Payment

On finance upto Rs. 1.0 M: On finance over Rs. 1.0 M:

Minimum 15% of the vehicle price. Minimum 20% of the vehicle price.

Tenure Maximum repayment period is 5 years Mark-up Rate ** 1 year KIBOR + 3% p.a., to be revised on each anniversary of finance. SONERI GHAR FINANCE Purpose Purchase / Construction of Property for self-occupancy. Extension / Renovation on self occupied residential Property.

Product Categories Purchase of pre-constructed Residential Property. Construction of residential property on self owned plot of land. Extension / Renovation on self owned & occupied property. Balance Transfer Facility (BTF) for any of the above finance.

Eligible Borrowers
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Salaried Persons Self Employed Professionals Business Persons

Financing Amount

Purchase Construction Extension / Renovation Balance Transfer Facility

Rs.Up to 10 Million Rs.Up to 10 Million Rs.Up to 03 Million Rs.Up to 10 Million

Tenure

Purchase Construction Extension / Renovation Balance Transfer Facility finance)

Up to 20 Years Up to 20 Years Up to 07 Years Up to 20 Years (Calculated from the date of original

Mark-up Rates** 1 Year KIBOR + 2% p.a., to be revised on each anniversary of finance.

Processing Fee Rs. 2500/- or 0.50% of the finance amount whichever is higher (refundable where case is not approved). GENERATOR FINANCING Purpose of Financing For purchase of brand new Electric Power Generator to be installed at residential / commercial / industrial property owned by the borrower. Eligible Borrowers Salaried Persons Self Employed Professionals
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Business Persons

Financing Amount

Minimum Amount of Finance: Maximum Amount of Finance:

Rs. 0.1 Million upto Rs. 1.0 Million

Down Payment A minimum of 20% of price of the Generator (as per Quotation / Invoice) being financed shall be paid by the borrower Tenure Maximum repayment period is 3 years Mark-up Rate ** 1 Year KIBOR + 3% p.a., to be revised on each anniversary of finance. Processing Fee Rs. 2000/- per approved application.

Service Length Minimum 1 year of confirmed service with present employer in case of Salaried Person CORPORATE FINANCE Mr. Junaid in dealing in corporate finance, and he is also Incharge of credits department. MAIN PRODUCTS The main corporate finance products are, General financing facilities Import Financing Facility Exports financing facility.

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GENERAL FINANCING FACILITY General financing is further divided into four types, these are given below. Temporary Running Finance Running Finance Cash Finance Term Finance Demand Finance

Temporary Finance: Customer who maintains satisfactorily conducted account may at their specific request. Bank accommodated to temporarily their current account to meet unexpected and urgent financing requirement. Running Finance Running finance is nothing but the finance offerings by financial institutions against mortgages. It works under the working capital finance. Specifically, the running finance is a credit facility established for a specific time limit at variable interest rates. Cash Finance Cash finance is a term that means that the goods are pledged or released to the borrower against the cash payments only. While the running finance is offered by the financial companies against the mortgages. It usually comes under the heading of the working capital finance. Import financing Facility Import financing is further divided into two types, these are given below. Inward foreign Bills Finance against Imported Merchandise (FIM)

Export financing Facility Export financing is further divided into two types, these are given below. Pre-shipment Loan (PSL)
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Post-shipment Loan Finance against Packing Credit(FAPC)

SMALL AND MEDIUM ENTERPRISES (SMEs) Soneri Bank Limited, arguably at the forefront of commercial excellence, has strengthened its product profile by introducing the following cost effective innovative tailor made small and medium enterprises (SMEs) financing options on flexible terms to its most discerning customers need. The Market segment for this business is primarily SMEs and the bank stands committed to contribute in the process of national development with an explicit focus in providing quality finance solutions. MAIN PRODUCTS OF SMES FINANCING There are three types or products that they offered to their customers. SONERI SARMAYA SCHEME SONERI AASAN SCHEME SONERI TEJARAT SCHEME

WHO can avail this facility Individuals Proprietorship Partnerships Limited Companies

Salient Features of SBLs SMEs Products Competitive Rates, Tailor made need based products, quick processing time, Cash flow-based Lending and Flexible repayment periods. AGRICULTURE FINANCE Following agriculture finance facilities are provided by Soneri Bank Limited at its selected branches. PRODUCTION LOANS:
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Production loans are offered to meet the input and other working capital requirements for farming, orchards and nursery, tunnel farming, storage of raw material, transportation marketing grading and packing etc., by farmers. Note: Financing facilities for all other purposes as detailed in SBPs list of eligible items for Agricultural Credit are also available. DEVELOPMENT LOAN Development loans are offered for the purchase of tractors, trolley, thrashers, ploughs, cultivators, laser levelers, combine harvesters, processing machinery, transport for delivery of dairy, poultry, fisheries. Installation of tube-wells, turbine, land leveling, soil improvement, land reclamation, seed processing units and for godowns, silos and cold storages. LIVE STOCK To meet the fixed cost and working capital requirements for cattle farming, cattle feed units, dairy farming, poultry farming; poultry feed units and fish farming. REPAYMENT PERIOD Principal amount of Finance plus mark-up thereon is repayable depending upon nature of business ranging from one to five years. Revolving facility is also available under specific terms. MARK-UP RATE:

All Type of Agriculture Loans upto Rs. 100,000/- 6M Kibor + 2% Production Loan under Revolving Credit Scheme: 6M Kibor + 3%

Distribution of Credit: SBP has advised diversification of credit as under. 70% of credit should go to small land holders. 20% of credit should go to economic land holders. 10% of credit should go to above economic land holders. Finance can be provided to all categories of farmers owner/tenants), who are genuine growers and are able to provide proper securities/sureties etc. Indicative per acre limit of different crops is as under

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1. 2. 3. 4. 5.

Cotton Wheat Sugar Cane Paddy Other Crops

21,000 16,000 16,000 19000 As per actual cost

TYPES OF AGRICULTURE CREDITS There are two types of agriculture credits Production finance Development Finance

DEVELOPMENT FINANCE Development finance for farm and non farm credit are divided into three categories. 1. Short Term 2. Medium Term 3. Long Term Short Term: Short term finance usually allowed for working capital requirement. Medium Term: Medium term is needed for purchase of livestock and implements etc. Long Term: Long term finance are needed for purchase of tractors, agricultural machinery etc. Poultry, dairy, fish farms are lucrative investment areas. SECURITIES/COLLATERALS Mainly Agriculture Finance is provided against following securities. Creation of bank charge on agri land through pass book system. Lien on deposit. Pledge of gold/gold ornaments, silver/silver ornaments on weight/valuation certificate from banks approved Goldsmith.
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DUTIES ACCOMPLISHMENT During my six week internship, I fulfilled my assigned duties with integrity. I fulfilled all my duties on time. At the accomplishment of each duty, my work was appraised by the Branch manager. The duties that I have accomplished during the internship period are given below.

Opening new account of individuals customers Checking the balance of remittances ledgers. Passing the entries of daily fund transfers In clearing department, I checked the cheque of different banks and of the customers. Passing entries of Utilities bills in credit or debit memo. In trade department I have checked the L/C. In credits, I checked the procedure of loan sanction.

Well management allowed as working on those areas where the chances of errors are less. During my internship, Ive found that in banking sector concentration and consistency is of utmost importance. Your little mistake can create big problem.

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SONERI BANK MARKETING STRATEGY

SEGMENTATION Market segmentation is a concept in economics and marketing. A market segment is a sub-set of a market made up of people or organizations with one or more characteristics that cause them to demand similar product and/or services based on qualities of those products such as price or function. A true market segment meets all of the following criteria: it is distinct from other segments (different segments have different needs), it is homogeneous within the segment (exhibits common needs); it responds similarly to a market stimulus, and it can be reached by a market intervention. The term is also used when consumers with identical product and/or service needs are divided up into groups so they can be charged different amounts for the services. The people in a given segment are supposed to be similar in terms of criteria by which they are segmented and different from other segments in terms of these criteria. These can be broadly viewed as 'positive' and 'negative' applications of the same idea, splitting up the market into smaller groups. Examples:

Gender Price Interests Based on three basis: Demographic. Psychographic. Behavioral Style Demographic: Income. Occupation. Family Lifecycle. Psychographic: Life Style. Social class
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 Behavioral: Benefits. Services. Quality. Convenience. TARGET MARKET: Soneri Bank target market consists of individual clients as well as a number of business organizations. Due to different market segments, Soneri Bank different branches have their target markets. To capture the import business in Pakistan, the targeted segments is valid markets known as business & commercial hub of Pakistan. Due to specialized services provided by SONERI BANK, and its highly competitive foreign exchange rates, most of the major importers in this area deal with SONERI BANK. Examples include; Mughal Steel and International, New Shalimar Steel, Vellcone International, Rana Brothers etc. As far as the individual clients are concerned, the targeted segment is posh areas like DHA. POSITIONING: The distinguish place of product/service in target customer mind. SONERI BANK positioned itself as caring bank and customized banking. When customer thinks about Soneri Bank the following points come in his mind. Consumer banking. Easy approach to all departments. Felling of self respect. Relatedness. Fulfill of there dreams like (build own home, buy personal cars, etc). Guaranteed profit. Security.

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All these thinks are in the customer mind. Due to Soneri Bank aggressive growth when ever customer think about banking sector the first bank comes in mind that would be Soneri Bank. Soneri Bank positioned also as a fats growing .where there is a new town there would be the a branch of Soneri Bank provide maximum products/services under one roof .

Unique Positing: Positing mean image of service/Product in customer mind it can be created by various attributes or qualities of product /service. SONERI BANK positioned itself by a unique way that It is in the customer mind that: SONERI BANK is aggressive growing bank New town opened Soneri Bank reach there first SONERI BANK Spreads its branches at Tehsel Level in Pakistan POPS POP is associations that is not unique to the brand but is shared with others is strong, favorable and unique brand association. Points of Parity of the brand: Commercial Bank. Consumer Banking. Corporate Banking. PODs Pods are strong, favorable and unique brand association. These are attributes or benefit that consumer strongly associate with the brand, evaluate it, and believe that they could not find it in competitive brand. Pods of the brand: Brand Elements. Highest no. of branches among foreign banks. Huge Expansion Plan.
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 Pioneer in Customized banking. Areas of improvement in there positioning strategy: HR department Employment Motivation Proper Division of work Foreign Countries Research and Development

How these brands working on the IMC (Integrated Marketing communication) to build brand equity. Advertising: It is a non personal presentation in paid form to introduce a product or service idea They use the following tools for advertising. TVC SONERI BANK uses more TVC as compared to its competitors. They choose those channels for advertisement where its target customers exist. They mostly choose those spots for TVC at peak hours in between the News. And special in the cricket matches. The TV channels it chooses for advertise are Sports channels like Ten Sports, and others like PTV, GEO, ATV, ARY, etc. News Paper SONERI BANK uses leading newspapers that are read by the business class and the family heads. They mostly gave there advertisement mostly on Jung, Dawn, The News, The Nation, etc. Journals SONERI BANK used these journals to promote their name, DAWN, STAR, SPORTS. Magazines SONERI BANK used these magazines to promote there activities.

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Sponsorships Event Sponsor Sports Sponsor Sports Sponsor :( Where there is Sports, there is Soneri Bank) In the arena of sports, Soneri Bank is actively involved in sponsoring events. Sports today not only represent healthy and clean way of life, it is big business in its own right. The sponsoring events Sponsored by the Soneri Bank range from Cricket Golf, Squash, Polo, and Volley Soneri Bank, to Hockey. SONERI BANK uses attractive slogans to prominent Some famous Events are. Event Sponsor Social Events SONERI BANK encourages extra-curricular activities and social events that allows employee to have a social exchange outside the working environment. In this employee are encouraged to bring there family members along, giving them a chance to fell a part of SONERI BANK family network social events like; Picnics Barbeques Sports Cultural Tours

Actually they are creating a reference group (a group to which attached persons feel internal recognition by telling others about that group) and doing the marketing in terms of Word of mouth (The marketing that spread from one person to others in the circle of its family, friends, relatives, neighbors etc).some famous events are Whaga Border Trip 2006 Lahore Basant Trip 2007 Source of Brand Equity:
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Brand equity is willingness for someone to continue to purchase your brand about my product of Bank Soneri Bank. We discuss how our products attained the sources of brand Equity. Authenticity SONERI BANK is providing best services to its customers. it is there service of quality that with in nine years of there working they become the largest branch holder with in private banks. It represents there progress. Consistency SONERI BANK improving its products/services with the passage of time. They provide all the customized products/services that are needed by the low/medium level income. All Types of banking are available in all the branches. They did not give any chance to his competitor to over come there weakness. Reassurance SONERI BANK always created a true faith among their customers by giving different fatalities to there customers (WOL, WARID post paid connections).and making good relation ship by sponsoring different events (Basant Mela, Jashan-e-Baharian), social gathering, fairs on different occasions collection for earth quake victims, etc Differentiation The unique point that make different SONERI BANK from other banks is that they use penetrating marketing strategy instead of skimming, they focused on that segment which is mostly ignored by others banks. They provide all the banking facilities (car, credit cards, debit cards, TM cards, Home loans, Agriculture loans, study loans, etc) to a normal income person now layman can enjoy all the facilities that he only desires. They become so popular in banking sector that the really proof there slogan Caring Bank. The most prominent point is that there name is spreading through word of mouth. So they needed less advertisement as compared to other banks. Transformation of Experience Levels of Brand Awareness and Image Brand Awareness:
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Brand awareness is related to strength of brand node or trace in memory, as reflected by consumer ability to identify the brand under different conditions. It is necessary but not always sufficient in building brand equity. Consequences of Awareness: Learning: Soneri Bank created his node as a caring bank providing all the facilities to those segments where the people see dreams but not able to fulfill them Soneri Bank made them. Consideration: How SONERI BANK positioned in the consideration set of the people. The SONERI BANK makes it easy to get all those things which people required in easy manner. Like his different products and Services to the consumers if you want a car you simply go and fulfill the formality and get it at the same time rather you have to passed a long procedures. In his recently add. SONERI BANK show its all offers in appearing through one window. This makes the SONERI BANK in the consideration set of consumer mind. Choice: Choice advantage is depending upon on two things. Purchase Motivation. Purchase ability. In the motivation field we persuade or give an emotional touch with the consumers. SONERI BANK gave this touch with his different slogans and campaigns. In credits cards they use the slogans I m the person with all solutions in Sports they use where there is sports there is Soneri Bank. Recently the collect the funds for the earth victims. On the other hand purchase ability towards SONERI BANK products/services emphases on the peoples who have lack of knowledge about the product/services that was created through the promotional campaigns .advertisements in those channel where the target user are interested like during sports(cricket, golf, etc). How to build brand awareness: Brand Image:
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Brand image is created in the mind of consumers by a specific quality, slogan or brand name so that SONERI BANK created high image like SONERI BANK is the first time use penetration marketing strategy. He focused laymen as well as the upper class. A slogan that was used by SONERI BANK is Caring Bank that became so effective that it create a word of mouth for SONERI BANK. Using affiliate marketing programmer (WOL,Warid, McDonalds) Introduced the Islamic banking In Pakistan

Identification: SONERI BANK attained this level by recognition through his Slogan Caring Bank .it focused on the layman needs and fulfill it by presenting approachable schemes of products/services. Brand meaning: SONERI BANK created his meaning by presenting its valuable Products/services and covers the customer perception. Customer responses: Customers response about the SONERI BANK is resulted in increased the no of branches rapidly so that feelings of people about SONERI BANK become strong and strong with his efficiency.

Brand Salience: Brand Performance Brand Imagery Brand Judgment Brand Feelings Brand Resonance

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ANALYSIS Financial Analysis SWOT Analysis PEST

FINANCIAL ANALYSIS RATIO ANALYSIS Ratio analysis is an important and age-old technique of financial analysis. Ratios are important and helpful in the reference that: These simplify the comprehension of financial statement and tell the whole story of changes in the financial conditions of the business. These provide data for inter-firm comparison. The ratios highlight the factors associated with successful and unsuccessful firms, also reveal strong and weak firms. These help in planning and forecasting these can assist management in its basic functions of forecasting, planning, coordination and control. These help in investment decision in case of investor and lending decision in case of Bankers etc. However the ratios are only indicator, they cannot be taken as final regarding good or bad financial position of the business other things have also to be taken. Gross Spread Ratio = Net markup income Gross Mark UP income 2009 37.64% 2008 30.88% 2007 31.93% 2006 35.28%

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40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2009 2008 2007 2006 GS Ratio

Gross spread ratio shows the relationship between, Gross interest income and interest income earned, according to financial analyst this ratio should be higher, in the last five years no clear trend is showing, from 2005 to 2007 it decreased, but in 2008 Gross spread ratio increased.

Current Ratio Current Ratio = Current Assets Current Liabilities 2008 3.7 2.8 2007 2.72 2006

2009 2.53

4 3.5 3 2.5 2 1.5 1 0.5 0 2009 2008 2007 2006

Current Ratio

Current ratio show the ability of any firm to pay its short term obligation, Thumb rule says current ratio should be 2 or near the 2. , In Soneri bank current ratio was always more than 2 in the last five years which is quite satisfactory.
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Working Capital Working Capital= current asset current liability 2009 2008 2007 2006 16,704,790 23,862,664 20,998,670 17,735,785

25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 2009 2008 2007 2006 working Capital

Working capital is the difference between the current assets and current liabilities, higher the working capital better an organization can meet its day to day expenses, unfortunately in our case of Soneri bank working capital is showing a decreasing trend which is not a good sign.

Fixed Asset Turnover = Sales Fixed Assets 2009 0.14 2008 0.14 0.14 2007 2006 0.16

0.16 0.155 0.15 0.145 0.14 0.135 0.13 2009 2008 2007 2006 fixed Asset Turnover

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Fixed Asset turnover shows how much revenue has been generated against the fixed assets in the last time fixed asset turnover was same which was o.14 although it was low yet there was no increasing or decreasing trend.

Total Asset Turnover = sales/Total Assets 2009 2008 0.09 0.081

0.09 0.08 0.07 0.06 0.05 0.04 0.03 0.02 0.01 0 2009 2008

2007 0.078

2006 0.058

TAT

2007

2006

Total asset turn over shows the revenue generated against the total asset. Although the ratio of TAT is low but fortunately there was an increasing trend in the last five years

Debt Ratio= Total Liabilities Total Asset 2009 91.20 2008 91.40 2007 92.06 2006 93.09

93.5 93 92.5 92 91.5 91 90.5 90 2009 2008 2007 2006 Debt Ratio

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Debt ratio shows, the % of debt in total assets, if this ratio is lower means debts are lesser and interest expenses will also low and the profit will be higher, But in our case of Soneri bank Debt ratio is in higher 90s which mean debts are very Debt/Equity Ratio = Total Liabilities Shareholder Equity 2009 12.18% 2008 23.56% 2007 26.17% 2006 38.03%

40 35 30 25 20 15 10 5 0 2009 2008 2007 2006 Debt to equity

Debt to Equity shows the structure of capital, what % each component has in the total capital.

Times interest Earned Ratio = EBIT/Interest expenses 2009 1.49

3 2.5 2 1.5 1 0.5 0 2009 2008 2007 2006 TIE Ratio

2008 2.14

2007 2.39

2006 2.75

TI

E shows how many times is the earning before interest and taxes when compared with
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interest expenses, for financial stability this ratio should be higher which means interest are lower, in the last five years TIE ratio is having a decreasing trend which is not a good sign.

Net Profit Margin = Net Income Total interest income

40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2009 2008 2007 2006 NP Ratio

NP margin of Soneri bank has been decreasing in the last five years which is an alarming sign for administration, when we see in the last five years NP ratio has persistently decreased. Return on Total Assets (ROA) = Net Income Total Assets

2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 2009 2008 2007 2006 ROA Ratio

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Return on Equity (ROE) = Net Income Stock Holders Equity

2009 13.40%

2008 22.33%

2007 25.81%

2006 31.89%

35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2009 2008 2007 2006 ROE

Return on asset and return on Equities shows what you have earned when it speaks out in terms of total asset and total equities, as I is discussed above profits have been decreasing since last five years so as the return on assets and return on equities also has decreased which is not very attractive for investors

Earning Per Share = Earning available for common stock No of Shares of Common Stock Outstanding.

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2009 1.70 2.43

2008 3.29

2007 3.08

2006

3.5 3 2.5 2 1.5 1 0.5 0 2009 2008 2007 2006 EPS

Earning per share shows what you have earned in your each share pf investment, likewise other profitability ratios which have decreasing trend in the last five years, earning per share also having a decreasing trend and not very attractive for investors.

Advances to Total Deposits = Advances Deposits 2009 0.77 2008 0.66 2007 0.66 2006 0.67

3.5 3 2.5 2 1.5 1 0.5 0 2009 2008 2007 2006 EPS

Return on Deposits = Net Income Total deposits

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2009 2008 1.54% 2.45%

2007 1.85%

2006 1.933%

2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 2009 2008 2007 2006 ROD

Advances and deposits are prime components of financial statements of banking industry organizations because mainly there trading is commonly depend on these items so these both ratios are very important

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PEST ANALYSIS
(Political Environmental Social & Technological) Political: Political factors influencing the bank performance. We have seen, 10 yrs back the banking sector in Pakistan was flourishing, and the reason was political stability. Now the banking sector is declining not able to meet the required requirements by SBP. The reason is political instability. Particularly, agriculture people get benefits due to relations with politicians. Such people get loan and job on references. Economical: Population of Pakistan is very rich as compared to other countries. So economical factors are good for banking sectors. Soneri Bank always looking forward to cater their customer by its attractive offers like Basic Banking A/C for salaried persons. SBL has mission that we have more tome for you Social Factors Social and cultural factors are affecting the bank. Majority of the population is un-educated and unaware of the benefits of banking sectors. They have low saving and want to keep money with them. Technological factors: Technologically, SBL is strong and this element strengthens to SBL. Online banking advances and any transactions bank has speedy network. The reason of their speedy network they have limited operations. Their first priority is customer satisfaction. For this they have established ITDepartment in every branch to cater network problems. SWOT ANALYSIS There are following strength weakness opportunity and threats for SBL. STRENGTH: Since, inception of SBL, it has moved rapidly in expanding branch network and deposit bases along with profitable advances and increasing the products and services. SBL is serving particular certain community like (Agha Khanis). They are considering being their loyal customer. Agha Khan Hospital, Agha Khan Laborites and Agha Khan Medical College, All they have an account with SBL. Agha Khan is a Big name. The Pakistan Credit rating Agency Limited (PACRA) has maintained banks credit rating. SBL has been awarded an AA- for long term and A1+ for the short term and A+ for the Term Finance. Certificates reflecting banks well maintained risk profile with preserved sound asset quality. In order to maintain an effective communication of information regarding the need of valued client bank has designed its website to be user friendly as possible, SBL collaborate with different cellular companies to provide bank statement on their customerscell phone. Loyal workforce and satisfied Customers. WEAKNESS:
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As per bank policy, advertising and publicity is not extensively emphasized. Through advertisement customers could be kept abreast with the product and services. The main focus of SBL is major cities of Pakistan. Its direly needed to extend its network and people should be educated about the functioning of bank. Poor employee development and promotion. During the training the trainer couldnt gave them proper information. So the trainee faces problem. Defensive approach in lending. No branches of Soneri bank are in any other country. So the bank has to incur additional cost for correspondent banking.

OPPORTUNITY: The life cycle of an organization is comprised of threats as well as opportunities. If we say, today the rates of challenges are too high but simultaneously the rate of opportunity is also too high. It is obligatory to try to make progress with consistency as well as to adapt changes with the need of time, in order to cope up with both conditions. In the prevailing scenario, SBL should penetrate further and capture various corporate customer as well as retail customer by expanding their network. In addition to the excellent routine banking, it has earned a good name by offering special products like Soneri car finance, ghar finance and personal finance. So the penetration of these products could enhance the market share. SBL has launched another division know as Islamic Banking. This new aspect will also attract a large number of people, who dont want to deal with interest bearing bank. If SBL focusing on advertisement it would be good for organization, because promotions makes people know about the products of SBL. Management should also open new branches is rural areas to capture market share. SBL can enjoy handsome return its funding base by investing in capital markets in the foreign countries. If management of SBL giving facility of night banking to its customer. I think it would also attract the other bank customers. THREATS While doing business, threats are part of business. Especially, in this era, most of the financial institutions are working as Private Limited Company and facing or have a fear of threat from their competitor as well as new entrants. In order to maintain as well as enhance the market share , SBL always try to introduce new schemes /packages like Soneri generator finance etc In our country, the rate of inflation is increasing along with unemployment. So due to increase in price of the products, the saving of the people is decreasing with passage of time. So it is threat for banking sector. In future the deposits of the bank will decreases. The number of banks in Pakistan increasing with passage of time. Foreign bank like to open their branches in Pakistan. So it would be threat for SBL. SBL has also threat with different bank who are offering the same product like o Home finance o Car Finance o Self Finance o Education Loan
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So management may face problem. Uncertainty in political and economical environment. Mergers and Acquisitions are other threat to bank. Impact of Privatization.

CONCLUSION OF SWOT ANALYSIS Since SBL has decent strengths and opportunities in the market, its market share is increasing and it is expanding its branches rapidly. So I concluded that SBL is adopting and implementing on Growth Strategy.

SUGGESTIONS
If I was the manager of SBL. There are following suggestions for SBL. The life cycle of an organization is comprised of threats as well as opportunities. If we say, today the rates of challenges are too high but simultaneously the rate of opportunity is also too high. It is obligatory to try to make progress with consistency as well as to adapt changes with the need of time, in order to cope up with both conditions. In the prevailing scenario, SBL should penetrate further and capture various corporate customer as well as retail customer by expanding their network. In addition to the excellent routine banking, it has earned a good name by offering special products like Soneri car finance, ghar finance and personal finance. So the penetration of these products could enhance the market share. SBL has launched another division know as Islamic Banking. This new aspect will also attract a large number of people, who dont want to deal with interest bearing bank. If SBL focusing on advertisement it would be good for organization, because promotions makes people know about the products of SBL. Management should also open new branches is rural areas to capture market share. SBL can enjoy handsome return its funding base by investing in capital markets in the foreign countries. If management of SBL giving facility of night banking to its customer. I think it would also attract the other bank customers. Well at the same time SBL has some threats with different product line of their competitors. Now what they have to do? They just reduce their mark up rate as compare to their competitors. By doing this they may capture big market share. In long run it would also beneficial for the bank. They must focus on their own Marketing team, rather than outsourcing, their own Marketing team launches new ads. Management should give their customer good mark up rate.

CONCLUSION
Soneri bank Limited is engaged in banking service, and operate more than 118 braches including four Islamic Banking Branches in Pakistan. The bank operates in four segment corporate finance, trading and sales, retail banking and commercial banking.
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Within the span of 18 years, SBL has become the one of the largest private bank in the country. There are about 112 correspondent banks in 31 countries of the world. Its capital and reserves level is increasing day-by-day. Their main objective is to provide professional, personalized and efficient service to the clients at all the times. SBL is always looking forward to provide new and better services than their competitors. To develop Soneri bank Limited into an aggressive and dynamic financial institution having the capabilities to provide personalized service to the customers with cutting edge technology and a wide range of products, and during the process to ensure maximum return on assets with ultimate goal of serving the economy and society.

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REFERRENCES

www.soneribank.com www.sbp.org.pk www.wikipedia.org www.ibp.org.pk www.ezinearticles.com www.pacra.com/

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