Vision

“To become a dynamic and efficient bank providing integrated solutions

In order to be the first choice bank for the customers.”

Mission

• To provide value added services to our customers.

• To provide high tech innovative solutions to meet customers
requirements.
• To create sustainable value through growth, efficiency and diversity
for all stakeholders.
• To provide a challenging work environment and reward dedicated
team members according to their abilities and performance.
• To play a proactive role in contributing towards the society.

Values

• Integrity
• Excellence in service
• High performance
• Innovation and growth

1
 History of ABL

Allied Bank is the first Muslim bank, to have been established in December
1942 as the Australasia Bank at Lahore with a paid-up share capital of Rs. 0.12 million
under the Chairmanship of Khawaja Bashir Bux, the Bank had attracted deposits,
equivalent to Rs. 0.431 million in its first eighteen months of business. The Allied
Bank's story is one of dedication, commitment to professionalism, adaptation to
changing environmental challenges resulting into all round growth and stability, envied
and aspired by many.
In 1947, when Bank was in growing age, it had to undergo a shocking event which
divided Asian sub-continent into two independent states namely Pakistan and India.
Allied Bank, being the only Muslim Bank on the soil of Pakistan, lost over 50% of its
operations and assets which were on the soil of India. So in 1947 all the branches in
India were closed down .

The management undauntedly faced the multiple challenges resulting from huge human
and financial losses on the one hand and the task of providing the newly emerged
nation with efficient and effective payment system and banking facilities to all sectors
of economy .
In 1971, the Bank lost more than half of its assets and network due to crises. The Bank
not only survived this serious crisis but also regained its financial strength maintaining
the growth rates in key performance indicators.

In 1974, the Board of Directors of Australasia Bank was dissolved and the bank was
renamed as Allied Bank. The first year was highly successful one: 116 new branches
were opened during 1974 and the Bank started participation in the spot procurement
agriculture program of the Government. Those seventeen years of the Bank saw a rapid
growth.

2
In 1991 the branches increased from 353 in 1974 to 748 in 1991. In September 1991 the
Government divested portion of its shareholding and handed over the control and
management of the Bank to its employees. The financial health of the Bank deteriorated
during employees’ management compelling SBP to remove the employee directors by
its nominees in August, 2000.

During 2004, as advised by the Privatization Commission, the State Bank of Pakistan
(SBP) undertook reconstruction of the Bank’s capital whereby the Ibrahim Group, as a
result of bidding process, took over control of the Bank by virtue of acquiring 325
million shares of the Bank, representing 75.35% of the enhanced share capital. The
Bank is now well positioned to expand, grow and diversify its portfolio of products and
services.
In May 2005 Ibrahim Leasing Limited was amalgamated by transfer to and vested in
with and into Allied Bank Limited. ILL shareholders were issued ABL shares in lieu of
the ILL shares held by them. ABL was formally listed and trading of the shares of the
Bank commenced w.e.f. the following dates.

Islamabad Stock Exchange 8th August 2005

Lahore Stock Exchange 10th August 2005
Karachi Stock Exchange 17th August 2005

Now all shareholders of Allied Bank Limited can trade in the shares of the Bank at their
free will.

3
Corporate information:

Board of Directors
Mohammad Naeem Mukhtar (Chairman)
Sheikh Mukhtar Ahmad (Director)
Mohammad Waseem Mukhtar (Director)
Abdul Aziz Khan (Director)
Sheikh Jalees Ahmed (Director)
Nazrat Bashir (Director)
Farrakh Qayyum (Director)
Tasneem M. Noorani (Director)
Mubashir A. Akhtar (Director)
Kamal Monnoo (Director)
Khalid A. Sherwani (President / CEO)
Audit Committee
Farrakh Qayyum (Chairman)
Mohammad Naeem Mukhtar (Member)
Abdul Aziz Khan (Member)
Company Secretary
Zia Ijaz
Auditors
M. Yousuf Adil Saleem & Co.
Chartered Accountants
Ford Rhodes Sidat Hyder & Co.
Chartered Accountants
Legal Adviser
Haidermota & Co.
Barristers at Law and Co

4
Central Office
Bath Island, Khayaban-e-Iqbal, Main Clifton Road,
Karachi – 75600
Phone: 111-110-110
Head Office/Registered Office
8-Kashmir/Egerton Road, Lahore
Phone: 6360073

Organ gram

5
 Products and Services:

Following is the brief information about its Products & Services that ABL provides to
its customers. First of all we will discuss about its Products shortly. ABL is providing
these
Products:-
• Accounts
• Alternative delivery Channels
• Consumer Product
• Lending Products
• Corporate Leasing

• Accounts
1. Rupee Deposit Account
Rupees Deposit Accounts can be opened with a nominal amount and
furthermore, there are no limits on the maximum balance. Allied Bank pays
the most competitive rates of profit on PLS Savings Account. Funds can be
deposited into this account through cash, cheques and other financial
instruments drawn on any bank or any other branch of Allied Bank. A
deposit receipt is issued when funds are lodged in PLS Special Notice
Deposits or PLS Term Deposits. The longer the period of holding the
receipt, the higher the rate of return. Allied Bank also issues Deposit at Call
receipt to the customers. The beneficiary of the Deposit at Call receipt may
be the depositor himself or a third party. The Deposit at Call suitable for
making down payment, security deposits, etc. The Deposit at Call receipt is
paid on demand.

6
 2. Foreign Currency Accounts
Allied Bank offers the highest rate of return on Foreign Currency Deposits
in the Country. Accounts can be opened in US Dollar, Pound Sterling, Euro,
and Japanese Yen at designated branches. All Pakistani nationals residing in
Pakistan and outside Pakistan can also open Foreign Currency Accounts.
Resident Firms, Companies including Investment Banks can open accounts.

3. Allied Basic Banking Account

In order to provide basic banking facilities to low income people in
Pakistan, Allied Bank has introduced “Allied Basic Banking Account”
(ABBA).This account can be opened with an initial deposit of Rs 1000/=.
The account is a non_ remunerative account with no minimum balance
requirement. The account will be closed automatically if the balance
remains “zero” continuously for one year. The statement of the account will
be issued on yearly basis. There are no service charges on the said account
for a maximum 2-withdrawals and 2 deposits during a calendar month.
Additional transactions will be subject to a service charge as per Bank’s
schedule of charges for every withdrawal/deposit, while there is no limit for
free of charge withdrawals from ATM.

1. Alternative Delivery Channels

1. Allied Cash + Card

Allied Bank ATM Card, also referred to as "AlliedCash+", can also be used
as a debit card at merchant locations/service outlets having ORIX POS

7
Terminals and displaying the ORIX logo. To obtain your AlliedCash+ card,
just open your account with any branch of Allied Bank.

2. Online Banking
Allied Online is a unique service offering from Allied Bank Limited.
Through Allied Online, your account in Allied Bank is available to you from
any of our branches country-wide.

3. Internet Banking
Banking at your fingertips! Allied Direct Internet Banking offers you the
convenience to manage and control your banking and finances - when you
want, where you want to! It's Simple, Convenient, Secure and Faster. So,
just get clicking.

4. Helpline
Since the launching of Allied Cash+ Debit Card on January 27th 2003,
Allied Bank embarked on the path of value added consumer products.
Customer related services were being provided through our ATM-Wing
situated at Central Office Karachi.
As the numbers of AlliedCash+ Card increased, so did the services related
inquiries, complaints and requests from our customer. Hence, to facilitate
and to offer Quality Service to our customer, Allied Bank decided to
provide Toll Free Number Customer Services through 0800-22522.

8
2. Consumer Products

Master Card
You can now become the holder of a true Credit Card here in Pakistan.
Allied Bank under license from Master Card International, U.S.A issues it's
Master Card to anyone meeting the eligibility criteria. With the Allied Bank
Master Card you will be assured of a service meeting the highest
international standards maintained by Master Card.

3. Lending Products

1. Seasonal Finance
Seasonal Finance facility is allowed against pledge of produce of Cash
Crops harvested in that particular crop season. The delivery of pledged
stocks/goods is made against appropriate cash payment.
2. Import Export Business
Allied Bank provides highly efficient trade finance services for
import/export business for our clients/customers through large number
of authorized branches where trained and motivated staff is available to
handle the business on behalf of customer.
3. Running Finance
It is a short term loan allowed by the bank for a period of one year. The
running finance account can be operated and daily sale proceeds can be
deposited into the account.

9
 • Corporate leasing
Allied Bank Limited commenced lease operations upon amalgamation with
Ibrahim Leasing Limited. Facilities include leasing for machinery, commercial
vehicles, vehicles and equipments. The Bank provides lease facilities for
balancing, modernization, replacement and expansion schemes to corporate and
commercial clients in all industrial enterprises.

Services:
1. Home Remittances
The Bank having a network of 735 branches all over Pakistan, undertakes to
provide safe and instant payment of remittance from expatriates, routed
through designated foreign exchange companies and correspondent banks
with whom special arrangements have been made in this regard. Through
the Allied Express Service, Allied Bank ensures that beneficiaries' Accounts
in Allied bank branches are credited with in 48 hours of receiving home
remittance information from overseas.

2. Remittances
Allied Bank can transfer funds to the remotest part of the country for
payment/credit to the customer himself or a third party, through
Telegram/Telex/Telefax for payment/credit on the same/next day.
Telegraphic transfers can also be made abroad in Foreign Currency.
Carrying cash to strange alien location can prove to be risky as a single
incident can render one without monetary backup of any sort. Hence
travelers’ cheques are introduced by banks in order to protect against any
contingency.

10
3. Hajj Services
The Bank serves the intending pilgrims by helping them in performing this
religious obligation. The Hajj forms and other related services are provided
by the bank. However, the terms and conditions for accepting the Hajj forms
from intending pilgrims are in accordance with the Hajj Policy announced
by the government, each year. Hajj applications are available with all
branches.
During Hajj season, immediately after the Hajj policy is announced by the
Government of Pakistan.

4. Utility Bills
All branches of the Bank collect utility bills of electricity, gas and
telephones. For convenience of the customers, Utility Bills are collected by
the branches during banking hours and also in the evening-banking on all
working days. Bills can be paid through Cash or Cheques. Consumers may
drop bills with crossed Cheques into a drop box available at the branches
under "Cheque Drop-in" system.
Utility Bill payment facility - Pay your telephone, electricity, and gas utility
bills on any of our ATMs without having to wait in long queues outside
your branch.

5. Lockers
Allied Bank Lockers are available in three different sizes Small, Medium
and Large on a yearly fee. Locker holders need not have an account in the
Bank.

11
6. Commodity Operation

It is a Cash Credit Financing to Government Department for procurement

of various commodities, as per allocation of the limits by SBP on
Government of Pakistan Guarantee.

12
ATM Network

1) 1 Link Network
2) M Net Network
3) Online Branch Network

1) 1 Link Network
In continuation of ALL TIME BANKING services, with the country wide network
of 735 branches, we are pleased to announce that ABL has enhanced ATM services
by joining the "1-Link Switch" which has members of the Banks that are included in
the 1 Link Network .

2) M Net Network
The Allied Bank Allied Cash + card could be used in an M_Net .In Pakistan ,the
M_Net ATMfacilities can be availed at any of banks and locations that are included
in M Network .

3) Online Banking Network

ABL also provide its customer the Online banking facilities.

13
Hierarchy of ABL Satellite Town
Branch ,Gujranwala .

14
 Sir Naveed Sheikh Manager
Sir Hafiz Waheed Officer Grade 2
Miss Naghamana Officer Grade 3
Sir Shahid Cashier

Functions Performed by these employees are

Manager
In ABL the main functions performed by the manager are account opening ,lockers
operations , provide the service of providing credit to the different parties and also issue
the letter of guarantee in the favor of the institution on the demand of the customer ..

Officer Grade 2
This employees is performing the functions of online transactions ,filling of demand
draft ,Call at deposit receipt ,payment orders ,all types of slips filling .

Officer Grade 3
This employee is performing the functions of clearing ,inter city clearing ,OBC,IBC
and posting of all the transactions .

Cashier
Cashier is performing the functions of collecting the bills ,deposit the cash and the
deposit of the cheques of different banks .

15
Practical Exposure in Different departments of
ABL

Clearing Department

Customer Service
Bank Main Department
Cash Department
Departments
Credit Department

General Department

16
Clearing Department

17
In this department I have learnt about the clearing ,intercity clearing ,OBC.I have also
learnt about the procedure of sending and receiving of the clearing as well as the
important documents required for these functions .

In clearing department I have learnt that an employee is performing the following

functions

Clearing
• Inter City Clearing
• OBC ( Outward Bills Collection )
• IBC(Inward Bills Collection )

Definition of Clearing
“It mean ABL bank has received the cheques of different banks for deposit
from its account holders . These account holders have received these
cheques from different parties with whom they are dealing .These parties
have accounts in different banks . These cheques are sent to those banks
where different parties have accounts, to check whether those parties have
sufficient balance in their account or not.If the parties have the sufficient
balance in their account the relevant banks pass the cheques by sending
the advice that is the proof that cheques have been passed (Parties have
the sufficient balance in their accounts ).The whole process is called
clearing “.

18
 Types of Clearing
• Local clearing
• Intercity clearing
• OBC(Outward Bills Collection)
• IBC(Inward Bills Collection)

1) Local Clearing
In Clearing the cheques are sent for clearing in those cities that are under
the district of Gujranwala .

Local clearing is divided into two parts

• When bank sends cheques for clearing
• When bank receives cheques for clearing

a) Procedure when bank sends cheques for clearing

Enter all the cheques in the clearing register that are received by
bank from its account holders (customers) and send the cheques
for clearing .These cheques have been written in the clearing register
in this manner.(Account number of the accountholder ,Bank name ,
Cheque no. amount. And sum up all the amount of the cheques that are
sent for clearing.
b) Procedure when clearing is received
WhenABL bank receives the cheques for clearing first of all it checks the
accounts of the account holders. If they have the sufficient balance in their
respective account ,then ABL bank will pass the cheques and make
an advice.Otherwisethe bank will return the cheques and also intimate the

19
 reason of return through “memo” document.

Documents required when clearing sends

When all the cheques are enter in the clearing register ,next step is filling the
following documents in sequence wise

a) Document Bundle Cover : Clearing

b) Summary /Delivery Receipt
c) Add list
a) Document Bundle Cover : Clearing
The important information that are required for filling the document bundle
cover: clearing are date ,Stamp of the branch ,no of the instruments (how
many instruments sent for clearing ,Total amount in Rs ,authorized
signature of one officer is also required.

b) Summary /Delivery Receipt

Next step is also filling the Summary Delivery Receipt in
which :Dare ,total clearing instruments no ,stamp of the
branch ,one additional thing that is required in this delivery receipt
is seal number .

c) Add list
If the number of the instruments that are sent for clearing is
more than one than add list is made .
In Add list amount of all the instruments are written down
and add all these amount of instruments and also write their
total answer .
Stamps required for clearing

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 Stamps required for clearing are Branch Stamp , Clearing Stamp, On the
back of the cheque Payee’s account will be credited stamp is required .

2) Inter city Clearing

The procedure of the intercity is same as the local clearing .

Definition
“It mean that customers who have accounts in ABL are dealing with
different parties .Sometimes these parties belongs to other cities and
these cities are not under the district of Gujranwala. So these cheques
are send to other cities banks (or cities that are not under the district
of Gujranwala)for clearing .It is known as Intercity Clearing .”

Documents required when intercity clearing sends

Documents required for intercity clearing is same as documents required
for the clearing .

Stamps required for the Intercity clearing

Following are the stamps required for the clearing
• Branch stamp
• Clearing Stamp
• Inter City Branch
• On the back of the cheque payee’s account will be credited
stamp is required.

21
3) OBC (Outward bills collection )

Definition of OBC
“There are some areas in Pakistan where Nift is not providing its fast
service so the cheques are sent through courier for clearing in that
areas ”

OBC is divided into two parts

a) When OBC is sent for clearing

b) When OBC is received for clearing

a) When OBC is sent for clearing

When the OBC is sent for the clearing first of all the cheques are
entered in the OBC register.Then the other instruments are maintain.
These instruments are mentioned below

b) When OBC is receives

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Documents required when the OBC sends for clearing
When the OBC is sent for clearing these instruments are required :
Inter Branch cleaning Bills Schedule ,the Debit and the Credit voucher .

Details of the documents

Inter Branch Clean Bills Schedule

In Inter Branch Clean Bills Schedule :stamp of the branch ,date , address of the
ABL branch where OBC sent ,amount in rupees are mentioned .In special
instructions portion bill no cheque no drawee (name of the bank) and the amount
in Rs is also mentioned .

Debit voucher
In Debit voucher the OBC charges are mentioned .
The minimum charges of OBC is Rs 50
Sometimes it depends upon the amount
For example if the amount of the OBC is Rs 100,000 OBC charges will
be deducted in this way.
100,000*.20/100=200

23
 This amount is transferred to the bank’s income account commission
Rs 75(postage charges) is also transferred to the bank’s income
account postage .So the total income of the bank from OBC is
Commission + Postage
Rs200+ Rs75=Rs275

So the Dr voucher is filled in this manner Dr transfer to the customer

account who wants to send the OBC .Contra to the Bank’s income
account . This method of deducting the charges are applied when OBC
is passed .When OBC is returned then Rs 275 are deducted.

Credit Voucher
Two Credit vouchers are maintained
In first credit voucher
Rs 200 is Cr Bank’s commission account and in contra account
account no of the customer is mentioned.

In second voucher
Rs 75 is Cr Bank’s postage account and in contra account
account no of the customer is mentioned .

Cheques Return
Sometimes the chequesthat are send for clearing are not passed due to many reasons .

24
These are the reasons

Reasons of Return of cheques

Some times the cheques that are sent for local clearing or intercity
are returned (these cheques are not passed ).

Insufficient balance
If the balance is insufficient in drawee’s account, then the
cheque is returned .

Payment stopped by the drawer

Sometimes the drawer stops the payment due to many reasons
so the cheques are not passed .

Incomplete
Sometimes the customers don’t not fulfill all the requirement
and the things are incomplete so the cheques are not passed.

Drawer’s signature differs

The signatures are verified by the customer service manager
very carefully .Sometimes the signatures of the party do not
match with its original signature re .For this reason the cheques
are returned.

Alteration in date /figures/words requires full signature

Sometimes there is alteration in date due to this reason the
cheques are returned .

25
Postdated
If the date that is mentioned on the cheque is one day after,
the cheque will not be not passed .

Amount in words and figure differs

If the amount in words and figures are not same then the
cheque is also returned .

Cheque should not contain extraneous matter

Only fulfil the requirements that are demanded in filling the
cheques. Do not mention any sort of unnecessary things.

Revenue stamp required

If the cheques are not properly stamped.

Acceptor/Drawer deceased
If the drawer is deceased the cheques are returned .

Clearing stamp required

If the clearing stamp is missing the cheques are returned .

• Account closed
If the account of the drawer is closed then the cheques are not
passed .

26
 • Crossed to two banks
If the cheques are crossed by two banks then the cheques are no passed

Procedure of Returning the Cheques

Some documents are required for this purpose

Memorandum
• Add list
• Bundle cover : Clearing Return

a) Memorandum
Memorandum is also known as “ memo”. In this document first of all
branch stamp ,date .Cheque no of the return instrument ,account number
of the customer ,amount in ruppees ,reasons for return are also required .

b) Add list
If the cheques that are returned are more than one than add list is
made in which amount of the return cheques and their total amount is
mentioned .If there is only one cheque for return then add list is
not made .

Next instrument is divided into two categories

Bundle cover : Clearing Return

If the intercity is returned then Bundle Cover : Clearing Return (
pink color ) is required

27
Bundle Cover : Inter city Clearing Return
If the clearing is returned then the Bundle cover : Intercity Clearing

return (green color) is required .In this document date , Branch stamp ,
no of instruments returned ,total amount of returned instruments in
Rs is mentioned ,authorized signature of one officer is also required .
Staple all these instruments with the cheque that is returned.

28
Customer Service
Department

29
In Customer Service Department I have learnt that an employee is performing the
following main functions

• Slips Filling
• Online transaction services
• Filling of Call at deposit receipt and demand drafts
• Supervision
• Other important services provided by this department

1) Slips Filling
Some customers have current accounts in the bank and they want to deposit
cash or cheque in their accounts. For this purpose they fill the
current account deposit slips.

a) Current Account Deposit Slip

For filling current account deposit slip

• Date ,Month, Year is mentioned .
• Account number of the customer .
• Title of account(name of customer )
• Total amount in Rs .
• Amount in rupees (words ) is also mentioned .
• In the portion of Particulars
Cash has been written if the customers want to deposit cash .
If the customers want to deposit the cheque in that case
bank name , cheque number of the bank are also written.

30
 filling the counter slip in the same manner.

b) PLS Saving Account Deposit slip

Some customers have saving accounts in the bank and they want
to deposit cash or cheque in their accounts. So they fill the PLS
Savings Account Deposit slip. This slip is filled in the same
manner as current account deposit slip is filled.

2) Online Transaction Services

Sometimes the customers want to send the amount to their parties account which
are in different cities through very fast service known as Online Service
(computerize system ) .For this purpose the remote branch code is very necessary
where the amount isto be sent. The thing that is much important is that the remote
branch where the amount is sent should also be ABL branch . The amount can’t
be transferred to other banks through Online Services.

For Online Transaction Services online inter branch transaction

slip is filled
Information required for filling the online inter branch transaction slip

 Applicant name is required

It mean the name of the customer who wants to transfer the amount
through online .

 ID card number
The ID card number of the customer is also required who wants to

31
 transfer the amount .

 Remote Title
In this head mention the name of the party(or firm) whose account
has been credited .Remote account number is also required for online
transaction.

 Remote Branch
The branch where the customer wants to transfer the amount and also
mention the code of that branch, total amount in words as well as in
figures are also mentioned.

Types of Instruments
There are three types of instruments issued by the bank on the demand of the
customers.
• Demand Draft
• Call at deposit receipt
• Payment Order

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a) Demand Draft

Definition

“Demand draft means the instrument that the bank has issued to the
customer on their demand for out of city. “

Documents required for Demand Draft

i. Demand draft slip

ii. Demand draft block
iii. Demand draft register

i) Information required for filling the Demand Draft Slip

First step is to fill the demand draft slip in which
o DD number
o Total amount of the draft
o In whose favor
o Branch address as well as code is also mentioned .

ii) Information Required for Filling the Demand Draft Block

o Total amount in words (rupees )
o Total amount in Rs(figures)

33
 o Mention the name of the party in whose favor the draft is filled.
o Name and branch( code) of the city where draft is sent .

For example if the customer is filling the draft in favor of a

party which is in Lahore , the bank mentions the address of its branch

which is in Lahore and also mentions its code. Both these documents
are signed by two authorized officers of the bank.

iii) Demand Draft Register

All the particulars about the draft must also be entered in the Demand
Draft Register for banks own record .

b) Call at Deposit Receipt

Definition

“Call at deposit receipt is also an instrument which is issued by the bank

on the demand of the customer for within city “.

Documents required for Call at deposit receipt

i. Credit transfer voucher
ii. Call at deposit receipt block
iii. Call and deposit register

i) Credit transfer voucher

For the call at deposit receipt first of all credit transfer voucher is
maintained in which amount of the CDR,as well as the CDR number
and mention the name of the party in whose favor the CDR is

34
 maintained .

ii) Information required for the Call at Deposit Receipt block

Date
o Amount in words
o Amount in Rs (figures)
o Name of the person in whose favor the CDR is being issued .
o Name of the customer on whose account the CDR is being issued.

iii) Call at deposit receipt Register

All the particulars about the Call at deposit must also be entered in the
Call at deposit receipt Register for banks own record .

Payment order

35
 Other services provided by this department
The customer service manager does majority of his work on the
computer .On the computer screen some important heads are defined .
Basically these heads are the important functions performed by the
manager.Specific Number is assigned to these important functions .

1) Account Inquiry
2) Cash Transactions
3) Transfer transaction (XFR)
4) Account Statement
5) Supervision
6) Customer Status

When manager wants to enter any of the above- mentioned head he only
enters the number .

1) Account inquiry

If the account holder wants to know about the total balance in his/her
account, customer service manager tells him/her about the total
balance, after checking from the computer .By entering the account
number of the account holder .The screen will display the

36
  Name of the account holder .
 Status of the accountholder(active or inactive).
 Total balance of the account holder
 Cheque books leaves

It is important to tell the total balance to that customer who hold the
account and not to disclose this information to any other person because
this information is very confidential.

2) Cash Transaction
All the cash transactions are done under this head .For example When
the customer deposits the cash in his account ,first of all the posting
is done and the posting department marks the document number and the
supervision number on the voucher .The customer service manager
enters the document number in the computer. The computer will display
the account number and name of the person and customer service
manage will credit his account with the amount that is mentioned on
the voucher .Then computer will inquire you about the supervision
number .The manager enters the supervision number. After entering the
supervision number the computer will again inquire about another
formality .The manager enters “y” (yes) and thus the process of cash
transaction is complete.

3) Transfer transaction(XFR)
When the customer service manager has done the transfer transactions
on the demand of the customer then he uses this head known as tranfer
transaction (XFR).

37
4) Customer Account Statement
Sometimes the customer wants to know about the overall information
about his/her account datewise.For this purpose they want the account
statement of their account to know about how many amount they have

withdrawn the manager enter the date from the account and how many
amount they have deposited in their account.
The manager enters the date (from which ) the customer wants to get
the statement and enters his account number .It is obligatory for the
bank to provide the account statement to the customer after every
six months .
But if the customer wants this statement before six months
the bank will charge Rs 50 .This amount is sent to the bank income account .

5) Supervision
For supervision the customer service manager enter the document
number then the computer will display the name ,aaccount no of the
account holder. Then the Cr the account of the account holder then
manager enter the supervision number then the supervision is done.

6) Status Classification

Status classification of customer account

Active Status
The manager also tell the accountholder about their current
status .Sometimes the status of the accountholder is active. It
means that the customer is dealing with the bank and doing

38
 transactions regularly .

Dormant Account
Sometimes the status of the account-holder is inactive it
means the customer is not dealing with the bank for last six
months. So the customer account is “dormant or inactive
account “

Dr &Cr block
Sometimes the customer intimates the banker to block
his(Dr/Cr) .Sometimes the customer has lost his cheque and
he fears that somebody may get his cheque passed
illegally .For this purpose Dr block is used .

Deceased Account
If the banker gets information about the death of a person
who has an account in the bank, such account is called
deceased account .

39
40
Cash Department

41
Although all the departments of the bank are important but this
department of the bank is very important .The customers and other
public are linked with this department .In this department I have learnt about
following main functions :

a) Bill collection
b) Passing of cheques
c) Debit and Credit Register maintenance

a) Bills Collection
Although all the departments of the bank are important but this
department of the bank is very integral. The customers and other
public are linked with this department because this department collect
consumer bills .

Role of Cashier in collecting bills

I have learnt the cashier collect the bills from the customer and carefully
checks the due date of the bill and the amount of the bill..If the bills are
collected on due date then well and good If the cashier collects the bills
after due date then the cashier is fined.
The amount of the bills is entered in the register .The amount
of the bills is also entered in the computer . The amount that is
entered in the register must match with the amount that is entered
in the computer.

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b) Passing Of Cheques
If the customers wants his cheque to be enchased pass .The cashier
enters the account number of the customer and Dr the number of the
cheque, he also verifies the signature of the customer . If the signature
of customer is verified and there is sufficient balance in the account
then the cheque is passed and the customer collect the amount (cash)
that is written on the cheque .
If the customer wants to deposit cash in his account then she/he first of all fills
the slip and signs on the slip . The authorized officer verifies customer ‘s
signatures and also signs on the slip . Then the cashier collects the amount from
the customer and Cr the customer’s account .

c) Payment and Receipt Register

In the (Dr) payment register the cashier writes the amounts of those cheques
that are enchased by the customers, account number and the cheque number .
In the receipt register the cashier writes all the amounts that are deposited by the
customers .He adds all this amount in the previous cash in hand and deducts
today’s payment Then he will get the final amount , if this amount is greater
than Rs 500000 then the branch send this amount to its main branch otherwise it
retain it .

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General Bank Department

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Account opening is the first step in the banking .From this step the relationship between
the banker and the customer is continue .It’s the responsibility of the customer to
provide the correct information to the banker for the opening of the account .Otherwise
it create the problem for the banker .But there are some formalities in the opening of the
account because some necessary documents are required to fill for the opening of the
account .
I have learnt about these documents and learnt what necessary information the bank
will require to fill it.

Documents required for the opening of the account

a) Account Opening Application

b) Know your customer(KYC)
c) Specimen Signature Card

a) Account Opening Application

In this application following important things are mention.
a) Branch
In this head ,branch address and its code is mentioned .

b) Date
Date is also mentioned when the customer opened the account ..

c) Type of Account

Type of the account is mentioned which the customer wants to open

either he wants to open the current account , saving account , term account
or other type of account .

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d) Particulars of Account
In this head mention the
Title of account
It means to mention the name of the customer who wants to open the
account .

Initial Deposit
In this head mention the initial amount which the customer wants to
deposit in his account .

NIC/passport No
In this head mention the NIC /Passport No of the customer which is
necessary .

Occupation /Business
Mention the business or profession of the customer who wants to
open the account .

• Residential Address .
Mention the complete address of the customer .

National Tax No
If the customer has the national tax no also mention it.

• Contact No

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 Mention the new customer’s telephone number(office &residence ) ,
mobile number and email address .

e) In Case of Minor

Mention the date of birth of the minor .His/Her date of attaining

maturity is also mentioned .Name of the guardian is mentioned .

f) Operating Instructions

In this head mention the instructions about the account operation .

If the customer wants to open the account singly then he/she will choose
the option the account singly .In this case mention that single person will
operate the account .If the joint account will open then in this case
mention the option either or survivor .

g) Zakat deduction
If the customer wants to pay the zakat then choose the option “yes”.
If the customer want that the zakat should not deducated from his/her
account then an affidavit /declaration will be submitted to
the manager.

h) Address of contact person /Next of kin

Name and address and telephone number of the kin is
required .

i) Special instructions
If the customer wants to mention the special instructions about the
account operation and other things then fill this head .

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j) Other bank services to be used

If the customer wants to use other services of the bank mention

them.

k) Introducer
In this head the information about the introducer is required .Introducer is
the person who introduces the new customer .It is necessary for the introducer
that he has the account in that bank.

l) Nature of account
Nature of the account is mentioned Following are the nature of
accounts.
• Individual
• Partnership (registered/unregistered)
• Autonomous Bodies
• Joint Stock Company (public/private)
• Non trading organization /clubs /Associations
• Others .
The customer will choose any one from the above mentioned options .

m) Personal information
In this head the personal information of the customer is mentioned.
Name of the persons (if more than one) are mentioned who are authorized
to operate the account .
.
Cheque book issued head is not filled because the cheque books are provided
to the customer after one week.

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b) Know your customer document
This document is also necessary for the opening of account .This document is
divide into three sections .

 Section A
 Section B
Section C

A section

a) Account Number
In this head mention the account number of the customer.

b) Title of Account
Mention here the name and CNIC .

c) Addresses
In this head the complete residential address of the customer is
mentioned .Contact no is mentioned in the telephones and the
emails head .

d) Purpose of opening the account

In this head purpose of opening the account is also mentioned
 Personal Saving
 Business
 Others (Specify)

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e) Occupation
In this head mention the occupation of the person .

f) Source of Income
In this head mention the source of income of the customer
 Salary
 Family Business
 Investments
 Rentals
 Agriculture
 Professional
 Inheritance and others .
The customer will choose any one option according to his/her source of
income

g) Monthly Income
In this head four options are given ,the customer will select any one
option according to his /her income .

Section B
In this section mention the nature of the business /profession in detail .
Mention the geographical areas of the business

Section C
Mention the major transaction of the customer .Some options are given
the customer will choose any one

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 Cash
 Online
 Clearing
 D.D.issuance

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Lockers

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Lockers means the safe that are provided to the customers to keep their jewellery
,important documents in this safe .I have learnt about the types ,its initial deposits and
the important documents required for the lockers .
Allied Bank Lockers are available in three different sizes Small, medium
and large on a yearly fee. Locker holders need not have an account in the bank.

Types Of Lockers
There are three types of lockers

 Small
 Medium
 Large

a) Small lockers

If the customer has a small locker in ABL bank .He has to pay
Rs 1500 as annual fee .The customer has to deposit Rs 3000 as
security in addition.

b) Medium Lockers
If the customer has a medium size locker ,he has to pay Rs 2000
as annual rent .The customer has to deposit Rs 3000 as security in
addition.

c) Large Lockers
If the customer wants to rent a large size locker,he has to payRs
4000 as annual rent . .The customer has to deposit Rs 4000 as security
in addition.

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If the customer loses the key of the locker then he/she has to pay
Rs 2000 minimum. The depositors of current and saving accounts
will be entitled one rent free locker as detailed below .
 Balance of Rs 1000(M) or above one small locker free
 Balance of Rs 2500(M)or above medium locker free
 Balance of Rs 5000 (M) or above one large locker free

Documents required for the Lockers

a) Memorandum of Letting of Safe

b) Letter of Continuity
c) Form No 337

a) Memorandum of Letting of Safe

In this document the Company’s safe no is mentioned
Class of the lockers are also mentioned
o C for small lockers
o Bfor medium lockers
o A for Large lockers
Name of the lessee is also mentioned.

b) Letter of Continuity
Date ,annual rent in words and in figures are mentioned in this
document.

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c) Form No 337
In this form the important information required is Name of the lessee ,locker No
class ,key no special instructions if any will be mentioned ,signature of the bank
officer is also required for this document .

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Credit Department

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Credit department is providing the credit to the parties. This department providing the
credit only for the business purpose .The parties who want to expand their business as
well as to purchase the heavy machinery for their business the bank will provide them
the credit .
The parties will pay the principal amount as well as the markup to the bank
.Sometimes the bank will also provide the credit against the mortgage or the pledge of
the assets(stocks) .After visiting this department I have full knowledge of credit
documents .

Documents required for the credit

• Exposure Summary
• Sanction Advice
• Group Facility Summary
• Basic Information Report
• Credit Memorandum
• Account profitiability Report
• Copy of account opening form
• Copy of last sanction advice and subsequent amendment ,if any
• Form 151_R Loan Application
Basic fact sheet
• Resolution of Board of directors in case of LTD.CO
• Memorandum &Articles of association in case of LTD.CO
• Balance sheet along with noted of auditors
• Cash flow statement
• Audit Report &compliance there to
• Valuation report not older then three years
• Forced sale value certificate

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 • Stock report
• Legal opinion
• Other property documents
• Detail of security
• Assets declaration form of borrower
• Account statement

1) Small Exposures (Credit Application)

In this document the important information required is mentioned below

a) Exposure Summary
b) Obligor Tenor Profile (Rs million)
c) Stability Criteria

a) Exposure Summary
This head is again subdivided in to the following parts

1) Date of review
It means the date when the party wants to get the credit.

2) Next expiry date

It means the expiry date of the current credit facility
of the party.

3) Date of last Annual approval

It means the date of approval of the last credit
facility (Previous credit facility approval date) .

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 4) Last expiry date
Mention the expiry date of last credit facility.

5) Extending unit & control unit

Mention the name of the unit(institution) which provides the credit
facility to the party as well as the control unit.

6) Group
Mention the name of the group who wants to get the
credit from the bank .

7) CM
Also mention the name of the manager who provides the credit
facility to the party.

8) Obligor Relationship Since

Mention the duration of the relationship of the bank with the obligor .
For how any months and years the banker has the relationship with
the obligor.

b) Obligor Tenor profile (Rs million)

In the next category of this document the following things are
mentioned .
1) Obligor Name
In this head mentioned the name of the party (obligor ) who wants
to get the credit facility .

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 2) Obligor Tenor Profile
In this head mentioned the duration of the obligor .Either he wants
to get the credit for 1 year ,2 years,2_3years,3_5years or more
than 5 years .

3) Obligor Classified Exposure (RsMillion)

In this head mentioned the obligor status .It is further classified
into four types .

a) W.list
It means the obligor is under observation .He is not
financially strong.

b) SS(Sub Standard)
It means that the obligor business is not good , business is
sustaining loss.

c) DF(Doubtful)
The bank has doubt that the obligor is not in the position
to pay the principal amount as well as the markup .

d) Loss
The obligor is sustaining heavy loss .

c) Stability Criteria

In this head mention the party reputation .Whether they fulfilled

their terms and conditions ,agreements or breached the agreements.

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2) Sanction Advice
When the manager has done all the formalities of collecting and
filling the credit documents the manager then sends the credit
proposal to the Credit Administration Department(CAD) .This
department sends all these documents to the regional head office of
the branch .This regional head office then sends all these documents
to the Credit Relationship(CRR), the head of this group overviews the
credit documents of the obligor carefully to analyze either this
party has the potential to repay the principal amount as well as the
mark up and also analyzes about the goodwill of the obligor and its
business .If all the things are fulfilled and fine then this group
passes the credit proposal of the obligor and intimates the regional
head of the bank .This department further intimates the Credit
Administration Department , which will also make the advice
known as the sanction advice .This advice is also the important
document of the credit proposal.
Important things mentioned in this document are
a) Obligor Name
In this head mentioned the name of the obligor e.g XYZ Flour Mills .

b) Business segment

In this head mentioned the segment of the business e.g SME.

c) Extending unit
Mentioned the name of the bank who provide the credit facility to the obligor .

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d) NTN

Mentioned the National Tax Number of the obligor (if any).

e) Industry type
Mention the industry type of the obligor business e.g flour mills
tobacco products, textile industry).

f) Legal Entity
It means the entity of the business (partnership ,sole
trader ,company )

g) Expiry date of the credit.

Mention the expiry date of the credit facility .For example if the
party gets the loan on 4thApril ,2007 .and the expiry of the credit is
31stMarch,2008 .

h) Facility
It mean the obligor will pay the mark up from the running finance of
the business .

i) Existing
It indicates the total amount of the credit that the obligor gets from
the bank .e.g Rs3000000, etc.

j) Proposed
It indicates the proposed amount of the credit .

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k) Net inc/dec
Here mention the increase /decrease in the existing and the proposed
amounts.

l) Days Overdue
Here mention how many days the obligor has delayed the amount of credit.

m) Security Description
In this head mention the security offered by the party.
For example if the party gets the credit against the hypothetication of
stocks ,and/or the mortgage of the property .

i) Hypothetication of stocks
In this head the bank will calculate how much
stocks the party will have for getting the loan .The ratio of the stock
75% the bank will retain 25%stock will retain the party. Suppose the
party gets the credit of Rs 3000000.Calculate in this way

75/100*3000000+3000000=5250000.
This value of stock will be kept by the party in their go down
against the credit .
ii) Property as Collateral
For the collateral of the property calculate in this way

25/100*3000000+3000000=375000

This value of the property will be kept by the bank as a colleteral.

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 The important information about the property is also mentioned .
For example its marlas,where the property is situated, who owns
the property,who evaluated the value of the property ,date of
inspection of property, market value ,forced value of property is
also required .

3) Group Facility Summary

In this document mention the obligor name ,obligor code,

extending unit, industry type, proposed ,existing limits, fund based
expiry date of the credit

4) Basic Information Sheet

In this head mention the personal information of the obligor .e.g

Name,Adress&Tel# Date of Busines Legal Obligor Date of

Establishme s Entity Relationshi review
nt Segmen p Since
t
XYZ Mills Ratta 01.02.1999 SME Partnershi 18.10.1999 14.04.0
Road,GRW.055_39456 p 7
78

Also mention the obligor’s main products information ,its production

capacity, machinery make, model ,capacity utilization ,reputation and
quality of products.

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Products Flour ,Maida ,Suji
Production Capacity 1250Bags per 24 Hours
Machinery Make &Model Local imported
Capacity Utilization 100%
Reputation and Quality of Products They enjoy good market reputation and
believe to deal in quality products
Who are the key suppliers of the Food department &farmers are the main
company ‘s raw material suppliers.

Mention the name of the shareholders their net worth

b) Share holders/partners

Director/Partner’s Shareholding Guarantor Net Shareholders(Other

Name % (Y/N) Worth than Directors)
ABC 33.33% Y 26.863(M) None
DEF 33.33% Y 8.334(M) None
GHI 33.33% Y 10.344(M) None
Total 100 Y

c) Management

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Name of the Parners
In this head mentioned the name of the partners who owned the
business.
Position
Mention the position of the partners .
Contact No
Mentioned the mobile no ,and other contact no of the partners .
o Remarks (Age Experience ,Qualification)
Mentioned the age as well as the experience of all the
partners. These information is also mentioned in this document .

d) Marketing reputation
In this head mentioned the name of the persons who knows the party
and dealing with the parties and ask their comments about the obligor .

S.# Name Relationship Remarks

with obligor
Person Company/bank
1 SFS Company Competitor Very Good Market Reputation
2 MSF Supplier Farmer Very Good Market Reputation
3 BSD Dealer Friend Very Good Market Reputation

5) Credit Memorandum

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 a) Purpose
In this head mentioned the purpose of the proposed facilities .
Discuss the structure of the purposed facilities in relation to the
obligor’s need. To meet with increasing financial needs of working
capital fo smooth running and further promotion of business .

b) Ways Out Analysis

In this head indicate ,for each facility ,the primary and secondary
(if applicable) way out .For example

Facility Ways out Ways out Comments

Primary Secondary
Running finance Realization / Realization The obligor is running a
Deposit of of sale good remunerative and
sale proceeds proceeds of progressive business and
of mortgage partners possess sound
hypothecation property financial means
stocks

c) Three years exposure trend

Mentioned how many total exposure to the obligor has changed
over the last 3 years .

d) Management Assessment
Provide the information who make the decision about the firms .

e) Financial Indicators

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 Provide the financial indicators of the company .

f) Account profitability Report

In this document the obligor provide the account profitability report
of the business .And this report is audited by the CA of the obligor
business .

g) Copy of account opening form

The copy of account opening form is also required to get the credit
facility from the bank .That shows that the obligor is the account
holder of the bank .

h) Copy of last sanction advice and subsequent amendments

In this document the obligor also provide the copy of last sanction
advice to the banker .

i) Application form #151-R

In this document the obligor writes the application to the manager
of the bank to get the credit facility .In this document mention all
information relating to the business e.g name of the business its
establishment date account number , national tax number and
all other information.

Other detail of this document

 Existing Facilities from the ABL is also mentioned

In this head mentioned the name of the branch ,amount of

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 the credit ,date of expiry .

Facilities enjoyed by sister concerns Form ABL

In this head mentioned the name of the branch as well as
the name of the concern ,amount of limit ,date of expiry
particulars of securities with present value ,overdues .

 Limit requested for fresh sanction /renewal /enhancement

In this head mentioned the existing amount of the credit ,
particulars of securities offered with present value and
encumbrances if any .

Name of the guarantors

Name of the guarantors are also mentioned .

 Details of immovable and moveable properties owned by the

borrowers /Guarantors
Also mentioned the detail of borrower moveable, immoveable
properties.

Business Committed
In this head mentioned the exports ,Imports, Collection remittances.

10) Borrower’s Basic Fact Sheet

In this document mentioned the address of the business place ,detail of the

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 directors name of the partners ,contact number of the partners ,shareholding
amount %of shareholding ,exective director /partners ,name addresses ,
phone# and other important information is required .

11) Resolution of board of directors in case of LTD Co

In case of company the board of directors resolution is also
mentioned .

12) Memorandum &Articles of Association in case of LTD Co

In case of company the memorandum & articles in
is also mentioned.

13) Balance sheet along its noted of auditors

In this document mentioned the balance sheet of the business noted
of auditors.

14) Cash flow statement

In this mentioned about the cash statement of the business .

15) CIB report no older than three months

In this head mentioned the CIB report no older than three months .

16) Audit report and its compliance there to

Provide the banker audit report and its compliance there to.

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17) Valuation report not older than three years
Valuation report of the property is also mentioned that is not older
than three years.

18) Forced sale value certificate

Forced sale value certificate is also provide to the banker .

19) Legal opinion

Legal opinion about the property and other assets of the
business is required .

20) Other property documents as per legal opinion in case of fresh

property
Other property documents are also required .

21) Detail of security

Detail of the security is also required .

22) Assets declaration form of borrower

Net worth of the borrower’s are also mentioned on individual
basis.

23) Account Statement

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Account statement of the business is also mentioned.

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SWOT ANALYSIS

74
 Internal Analysis

Weaknesses
Strengths

Opportunities Threats

External Analysis

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 Strengths of ABL
• Fast Service

• Providing the staff comfortable environment

• Experienced Staff

• Satisfied their customers .

Weaknesses of ABL

• Not very qualified staff

• Shortage of Staff
• Not providing good quality computers to their staff

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Opportunities of ABL

• ABL availing the opportunity of lunching new schemes

• Providing good return on the principal amount
• ABL branch getting the first position in collecting deposits

Threats of ABL
• Other banks providing good quality computers to their staff that is threat for
the ABL.
• Other banks have no shortage of staff and they provide fast service to their
customers as compared to ABL

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Financial ANALYSIS

79
Ratios specific for bank

The year under consideration of 2005 and 2006.The ratios explain under this section are

as followings

• Earning assets to total assets

• Return on earning assets

• Net margin to earning assets

• Loans loss coverage

• Loan to deposits

• Deposit time capital

Earning assets to total assets

Year under consideration 2005 vs. 2006

Items include

 Balance with other banks,

 Lending to financial institutions,

 Investment,

 Advance,

 Other assets,

 Operating fixed assets,

• Deferred assets.

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 This ratio explains who will a bank put its assets into work. Normally higher

performance bank have high ratio and vice versa.

Earning assets to total assets = Earning assets / total assets

2006 2005 %change

84% 86% No change

Comments
The bank most important assets are earning assets (lending to other institution, loans,
investments) etc. bank efficiency depends upon the worth & volume of the earning in
total assets. This ratio shows the performance of the bank that shows how well bank
puts its assets to earn high rate of profit. The result of this ratio shows the same results
in both years .their is a slide difference that is negligible. Only the balance to other
banks decreases with percentage of 48 % as compare the 2005 and 2006. All other
earning assets increase that is the
• Lending to financial institutions increase by 229.73%
• Investments increase by 4.5%
• Advances increase by 29%
• Total assets increase by 30.8%
Those show the performance of the bank .the bank utilizes their assets in proper
way and earning the profit. Because the only the minimum variation in the ratio.

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Return on earning assets

Year under consideration 2005 vs. 2006

Items include

• Balance with other banks

• Lending to financial institutions,

• Investment

• Advance

• Net profit before tax

• It is the measure of profitability of any bank and quality of earning assets.

Return on earning assets = Net income before tax/earning assets

2006 2005 %change

3.1% 2.9% +ve

Comment

This ratio explains the control of management over the spread of interest income to
interest expenses. Higher ratio in 2006 indicates the controllability of management over
the interest income. In 2006 interest income is higher then 2005.
It is also the measure of profitability of any bank and quality of earning assets. The
ratio is higher in 2006 as compare to 2005. That increase occur due to major change in
markup that is 33% and the mark up increase because the advance of the bank increase
that is 29%.that show the bank have the more earning assets and the more earning
assets show the more profitability of the bank.

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Net margin to earning assets

Year under consideration 2005 vs. 2006

Items include

• Balance with other banks

• Lending to financial institutions,

• Investment

• Advance

• Net margin

This ratio also related to profitability and also shows the control of bank over the

spread of interest income to interest expense.

Net margin to earning assets =net margin / earning Assets

2006 2005 %change

3.376% 1.843% +ve

Comments
This ratio explains the profitability pattern of the bank because the major earning of
bank and the expanse both are the mark up. The results of the 2006 shows that bank
properly control the spread of its revenue to its expense. The interest earned increase in
2005 33.35 % that show the bank performing the good as compare to 2005.that also
show the bank gives more loans that are recovered with interest .the interest expense
also increase in 2006 with 235.51%.but it have no more effect because the earning of
the bank is also increase as compare to the expense.
Loans loss coverage

Year under -consideration 2005 vs. 2006

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Items include

• Provision against loans and advances

• Bad debts written off directly

• Pre tax income

.This ratio explain the capacity of the bank to cover its loan loss through its yearly
income higher the ratio better the result. This also explains the level of protection of all
depositors.
Who are involved in funds of bank or prospectively wants to involve in the funds of
bank. If we have more then one ratio answer it shows we can recover over net charges
off
• Quality of loan
• Efficiency of management
Loans loss coverage = Pre tax income/net charges off

2006 2005 %change

925.80% 841.53% +ve

Comments

The ratio provides the security to the deposit about the coverage of loss. Higher the

ratio indicates the better management of the bank and vice versa. Analysis of this ratio

show the bank is secure the bad debts of the bank is very low as compare to 2005.The

% age decrease in the bad debts is 14.9% that show the performance of the bank that

84
they have the good dealing with customer and reduce the bad debts that is plus point for

bank. And the income before tax is increase in 2006 as compare to the 2005 that is

37.75%.that all figure show the good performance of the bank.

Loan to deposits

Year under consideration 2005 vs. 2006

Items included

• Lending to financial institutions

• Advances

• Deposits and other accounts

Loan to deposits = Advances / deposits

2006 2005 %change

69% 72% +ve

Comments
This ratio related to assets to liability ratio because the major assets of the bank
involved in loans and major liability in deposits. Higher the answer shows the bank
strength against the risk.

The ratio is higher in 2006 as compare to 2005.this ratio act as the debt to coverage

ratio so when we see in this context then it is not good because some time it is difficult

85
to cover the debts and that is converting into bad debts that are risk deal. But when we

deal in context of debt to equity then it is good for the bank because more loans show

that bank earned more returns.

The percentage change increase in 2006 in advances is 29 %.That show the bank

earned more return because the bad debts also decrease in 2005 with %age change of

15% that show the good performance of the bank. The advance also increase with %

age change of 29%.that show the people have the trust on bank to deposit the money in

this bank.

Deposit time capital

Year under consideration 2005 vs. 2006

Items included

• Deposits

• Equity

Deposit time capital = deposit / equity

2006 2005 %change

1269% 1242% +ve

Comments

This ratio is act as debt to equity ratio. That has their own prospectus as they are high or

low. Because if the equity is high that show that have greater margin of safety. And

when a deposit (debts) high that shows that provides the high margin of return. This

86
ratio is increase in 2006 as compare to 2005. we also take the percentage change in the

deposits and equity then that show that they both have the increase trend in 2006 as

compare to 2005.in deposit the %age increase is 27%.that show that have the more

return because when they invest that money in other financial institution then that give

more return and when see the equity then that also have increase trend that with %age

change is 25.67%.that show the bank have more margin of safety in 2006 as compare

to 2005.but when see the over all ratio trend the equity is more in 2006 as 2005.

. It show the capital structuring of bank high deposit

ratio in 2006 reflect more strength than 2005. High equity indicate margin of safety
available to the investor.

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