Bank Management Final Project Submitted to: Prof.

Tehseen Submitted By: Somia Ibrahim l1f08bbam2039 Saira Javed Umair Tariq l1f08bbam2132 l1f08bbam0163

Date of Submission: 19th Jan, 2012

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Vision
To be a world class bank dedicated to excellence, and to surpass the highest expectations of our customers and all other stakeholders

Mission
Set the highest industry standard for quality, across all areas of operation, on a sustained basis Optimize people, processes and technology to deliver the best possible financial solution to our customers Become the most sought after investment, and Be recognized as the employer of choice

History of United Bank Limited (UBL)

The history of UBL can be divided into four main Phases 1. Formulation 2. Nationalization 3. Privatization 4. Today

1. Formulation
In June 1957, Mr. Agha Hassan Abidi decided to open a Bank different from others, to provide modern facilities to trade and industry and to promote thrift and habit of saving amount common there by stimulating the economy as a whole. Necessary formalities completed for obtaining registration certificate from State Bank of Pakistan to perform business activities. After passing through all these formalities on 7th November, 1959 United Bank Ltd came into existence as a Schedule bank. The Head office of the Bank
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was established in the New Jubilee Insurance House, 1.1 Chandrigar Road Karachi. It was registered as a joint stock company. The bank was incorporated with an Authorized Capital of Rs 20,000,000 and issued and subscribed and paid up capital of RS 10, 00,000. Saigol family owned it and Agha Hassan Abedi was its first managing Director. It had posted a profit of 0.7 million in its first year of operation with just eight branches at Karachi.

2. Nationalization
As a policy of nationalization, fourteen commercial banks were merged into five big banks. So consequently on 21st December 1974 Commerce Bank and Union bank was merged with the UBL. Mr.Mushtaq Ahmed khan Yousafi took over the charge of UBL. Now, there are six directors, a secretary and a president.

3. Privatization of UBL
UBL was the largest privatization attempted by the government of Pakistan, launched in June 2001, with 21 interested parties. It was impacted by the adverse developments of the September 11; 2001and was finally concluded in October 2002, which left stage only three bidders. The consortium comprising Best way Group (BG), out of the UK and Abu Dhabi Group (ADG) from the UAE were finally the winners at is cord price. Sale proceed was Rs 12350 million. This signaled the strong confidence reposed by these investor groups, in the improved governance of the country, the economic potential, the banking opportunity and the existing management of the bank.

4. UBL today
Today the bank has taken progressive step. Change the loge The United Bank Limited (UBL) management has launched its new corporate identity and changed its 44 year-old-logo following its privatization. UBL online
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Now access your account from 71 cities across Pakistan. Our network is growing at an amazing pace and now you can avail services like cash withdrawal, payments, deposit, stop payment, acquisition of account statement and many more from more than 350 online branches. Business Partner9-5 Non-Stop Banking Banking at your own convenience has been made possible. UBL now offers 9-5 NonStop Banking service at more than 450 branches across Pakistan. Countrywide Instant Cheque Clearance Submit a cheque in Karachi and get it cleared in Peshawar It begun with a vision, a vision of unparallel progress and unmatched excellence true to the spirit of the era! November 7th 1959, Pakistan witnessed an event that would change the way we banked forever. It was not just the inauguration of UBLs first branch at I.I. Chundrigar; it was also the birth of the culture of service, a culture of innovation and a culture of financial excellence! By June 1960, shortly after six months of opening its doors to the public, UBL had branches in:

Karachi Dacca Lahore Lyallpur Chittagong and Narayanganj

In 1963, UBL became the first bank in Pakistan to have a branch overseas- on William Street in London, United Kingdom. True to our promise of providing service and care beyond the ordinary to our customers, UBL and You have had a history. The first saving scheme for school going children was launched as early as 1960 or the formation of Pakistans first Staff College of employees in 1964, UBL, through the motivation of its staff and the trust of its customers, continued to grow at a spectacular pace. In 1967,
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UBL had hit the dawn on information in terms of technology, by introducing computer banking to Pakistan and in 1971, UBL once again paved the way by launching 3 online branches in Karachi. The newly formed state of Pakistan was witnessing the boom of industries and commerce cannoned by a bank that believed in the potential growth of Pakistan. Small wonder then, by 1978, UBL had a pledged economic department, had acquired two international banks. UBL also launched supervised credit and small loan schemes for small to medium sized firms as well as agriculture and had made for itself, a strong international presence for we had branches in 4 continents. Throughout its history, UBL has kept pace with- and often exceeded the changing needs of changing times. Keeping the tradition of innovation alive, UBL introduced Pakistans first credit card, the UNICARD in 70s and left its mark by launching the Pak Rupees traveler cheques in 1971. Staying true to its roots, UBL was also the first bank to have an Islamic banking division and the first to introduce e-banking facilities at Hajj. In the 1990s the government of Pakistan decided to change the face of banking by creating a blueprint to privatize UBL. At this point, financial experts were called on board to set the bank back on course, and with implementation of relevant changes, the government privatized the bank in the year 2002 Best way and Al Ayaan collaborated, forming the cornerstone for the UBL of tomorrow. Today, UBL opens its eyes to a new vision every day, a vision of resurgent excellence and renewed commitment to our customers. 52 years into our glorious history UBL is now part of one of the worlds largest financial services groups. Our deposit product portfolio offers an eclectic mix for all types of financial requirements. Whether you are an individual interested in opening a savings account, or a businessman wanting to maintain a foreign currency account, or a small business with a requirement of a business account for your daily transactions, our deposit products offer you the range you require. Check out our extensive deposit products and services and find one especially suited to your needs.

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INTRODUCTION:

Over 380 billion assets Over 1100 branches in Pakistan and 15 overseas branches UBL has one of the largest and strongest balance sheets amongst banks in Pakistan

Merger of treasury and capital markets Best domestic provider of FX services The narrowest bid/ask spreads and the fastest quotes It started trading currency option in 2005 It acquired the status of authorized dealer (ADD) Over 1100 online branches in Pakistan as well as in overseas

Networking:
UBL has a total of 1,059 branches (including 15 overseas branches) of which 640 branches have on-line connectivity (FY05: 496) with the head-office through an ISDN or satellite connection while the remaining are still to be brought on-line. Out of the total off-line branches there are at least 211 branches in the far-flung areas of the country (FATA, parts of Kashmir) which are not automated. Critical information from these offices is physically delivered to a nearby located main branch. International networking of UBL includes the following countries having international branches subsidiaries and representative offices: 1. Aden Branch 2. USA New York Branch 3. OBU EPZ EPZ Branch (Karachi)

4. IRAN 5. KAZAKHSTAN
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6. CHINA 7. SWITZERLAND United Bank AG (Zurich)

8. UK United National Bank Limited

9. OMAN I. II. III. IV. V. Ruwi Branch Salalah Branch Sohar Branch Ghoubra Branch Industrial Area Salalah Branch

10. UAE I. II. III. IV. V. VI. VII. VIII. Deira Branch Bur Dubai Branch Al-Barsha Sheikh Zayed Road Branch Sharjah Branch Khalifa Main Branch Sheikh Hamdan Road Branch Musaffah Branch Al-Ain Branch

11. BAHRAIN I. II. III. Manama Branch Seef Branch Muharraq Branch

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12. QATAR I. II. Corniche Main Branch Salwa Road Branch

13. YEMEN I. II. Sana'a Branch Hodeidah Branch

Financial Highlights of UBL (2009-2010):

UBL achieved a profit after tax of Rs 11.2 billion which is 21% higher than the corresponding period last year and translates into earnings per share of Rs 9.12 (2009: Rs 7.51). On a consolidated basis, UBL achieved a profit after tax of Rs 11 billion, an increase of 16% over 2009.

Despite the challenging economic environment, UBL has achieved a profit before tax of Rs 17.7 billion. This is 26% higher than last year as a result of continued improvement in operating efficiency and margins. Provisions for the year declined substantially due to the Bank's prudent approach given the difficult credit environment whilst the NPL formation has also reduced year on year.

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Net interest income before provisions increased to Rs 34.1 billion, 4% higher than last year. The Bank's low cost deposit efforts resulted in an 80 bps reduction in the cost of deposits over last year. However, the yield on earning assets declined as average 6M KIBOR was 39 bps lower in 2010 compared to 2009. Consequently, net interest margin increased from 6.9% in 2009 to 7.1% in 2010.

Types of loans and volume of bank loans:

UBL offers the following loan facilities including:

Business Financing loan Running Financing Facility Auto Loans Small Loans Personal Loans Home Loans Farm Loans Production Loans Development Loans Tractor and Vehicle Finance Non-Farm Loans:
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Livestock Financing Fisheries Financing

Business line Business Financing Loan

With UBL Business Financing facility, you can now take your business to greater and newer heights, and achieve the level of success that you truly deserve

Cash line Running Financing Facility

UBL Cash line is aimed to make your life easierZINADGEE ASAAN. Whether you are a salaried individual or a businessman

Drive Auto Loan

UBL Drive is a unique auto financing product which offers you features, options and flexibility unmatched by any other bank, because at UBL, You come first

Silah Mila
UBL has designed a campaign for the first time in Pakistan to acknowledge and reward customers who have shown excellent performance in their loan repayments with other banks

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SMALL LOANS
Under the Small Business Scheme, UBL is providing loans on easy terms to those who wish to set up their own small-scale business. This scheme is aimed at spreading prosperity in the country by reducing unemployment. As more and more people start their own industrial units, the country will move steadily towards economic self-reliance.

Personal Loan
Higher loan amounts (Up to 20 multiples of salary) Convenient repayment schedules (Up to 48 months loan tenor) Competitive interest rates

Mortgages Baitna Home Loans

Financing of up to AED six million Repayment period of up to 25 years Salary transfer not mandatory

Home Loan Facility

UBL Address empowers you to become the proud owner of a home by offering a variety of product and pricing options that are flexible yet affordable.

Production Loan
Financing is available for Major and Minor crops across Pakistan. Main purpose of financing is to facilitate farmers to purchase Agricultural Inputs such as Seeds, Fertilizers, Pesticides, Sprayers, hired labor etc.

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Development Loan Land Development, Equipments and Machinery

Financing for Land Improvement, Water course improvement, Tube wells, Lift pumps, Deep turbine pumps, Cotton pickers, Go down, Cold Storage, Harvester, Thresher, etc Loan Tenure 1 to 5 years Lump sum disbursement of the limit for a specified period. Repayment in installments (Principal with markup). Repayment mode monthly, quarterly and half yearly Minimum Amount PKR 30,000 Maximum Amount as per requirement of Farmer

Tractor & Vehicle Finance

To purchase Tractors, Delivery Vans, Mini Trucks, Motor Cycle and other vehicles used for marketing Agric Products Loan Tenure 1 to 3 years for Motor Cycle 1 to 7 years for Tractor 1 to 5 years for other 4 wheel vehicles Lump sum disbursement of the limit for a specified period. Repayment in installments (Principal with markup). Repayment mode monthly, quarterly and half yearly Minimum Amount PKR 100,000 Maximum Amount PKR 1,500,000

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Non Farm Loans

Livestock Financing
Dairy Farming, Meat Farming, Fattening of Animals, Rearing of Animals, Construction of Sheds, Milk storage tanks, acquire and establish modern and efficient livestock facilities. Loan Tenure 1 to 5 years Monthly / Quarterly repayment mode for Dairy Farmers Monthly / Quarterly / Half Yearly repayment mode for Meat Farmers Minimum Amount PKR 50,000 Maximum Amount as per requirement

Poultry Farm structure and equipments, Hatchery farm structure and equipments, Feed Mills, Purchase of Chicks, Feed, Medicines, Storage tanks, Cold storage, Construction of shed, etc. Loan Tenure 1 to 5 years Monthly / Quarterly repayment mode for all loans Minimum Amount PKR 50,000 Maximum Amount as per requirement

Fisheries Financing
Fish seed, Fish feed, Manufacturing, Construction of pond, Curing and Dying by fishermen, etc.

Terms & conditions

Clean CIB
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1 to 3 years for Motor Cycle Markup payment frequency quarterly / half yearly for working capital loan Installment repayment frequency monthly / quarterly / half yearly / yearly for Term finance loans Minimum landholding 10 acres for Tractor Financing Equity for Tractor 10% Equity for 4 wheelers except Tractor is 25%

Volume of UBL Loans:

LIABILITIES Bills Payable Borrowings Deposits and Other Accounts Sub-Ordinated Loans Other Liabilities 2010 5045815 45104849 550645767 11985748 17587735 2009 5147259 35144823 492036103 11989800 14461725

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The table shows the UBL borrowings from SBP:

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Investments:
The United Bank has done investments in following areas: For 2010 In held for securities the total investment done by UBL is almost 16629658000 rupees which includes market treasury bills, Pakistan Investment Bonds, Ordinary shares of listed companies, Foreign securities, term finance certificates, Govt. of Pakistan-Eurobonds, Units of mutual funds and Sukuk Bonds.

For 2010 available for sale securities the total investment done by UBL is almost 109960827000 rupees and in held to maturity securities the bank has done total investment of almost 10346585000 rupees. In associates 7666215000 rupees investment has been done in the year of 2010 including United Growth and Income Fund, UBL liquidity plus fund, United composite Islamic Fund, United Islamic Income Fund, United Stock Advantage Fund, UBL Participation Protected Plan, UBL capital protected fund-II, UBL savings income fund, UBL Islamic retirement savings fund, UBL retirement savings fund, UBL insurers limited and Oman united exchange company, Muscat. Hence the total investment by the UBL in 2010 is approximately of 231717214000 after minimizing the deficits.

External Rating of Bank:

Karachi, June 28, 2011: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the entity ratings of United Bank Limited (UBL) at 'AA+/A-1+' (Double A Plus/A-One Plus). Ratings of the four outstanding subordinated debt instruments, TFC1, TFC-2, TFC-3 and TFC-4, issued by UBL have also been reaffirmed at 'AA' (Double A). Outlook on the assigned ratings is 'Stable'. Whereas, Capital Intelligence (CI), the international credit rating agency, has reaffirmed UBLs Foreign Currency longterm rating at B, while its Foreign Currency shortterm rating has been

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upgraded from C to B in line with CIs sovereign ratings action on Pakistan. In addition, the Banks Financial Strength rating has been reaffirmed at BB+, with the Outlook upgraded from Negative to Stable based on the Banks strong performance in 2009 and the first half of 2010.

Detail of Major Assets & Liabilities of Bank:

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The table below shows the credit rating of private banks:

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Types of Deposits & Volume of deposits as Capital Debt:

United Bank Limited deposit product portfolio offers an eclectic mix for all types of financial requirements. Whether you are an individual interested in opening a savings account, or a businessman wanting to maintain a foreign currency account, or a small business with a requirement of a business account for your daily transactions, our deposit products offer you the range you require. Followings are the deposits that UBL offers:
1) 2) 3) 4) 5) 6) 7) 8) 9) 10) 11) 12)

UBL Business Partner UBL Business Partner Plus Rupee Transactional Account UBL UniFlex UBL Unisaver Certificate of Deposit Foreign Currency Savings Foreign Currency Term Deposits Receipts Regular Term Deposits Receipts Special Notice Deposits Receipts UBL Basic Banking Account UBL First Minor Savings Account

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Capital debt of UBL:

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Investment:
Investments of the united bank limited, other than investments in associates are classified as held for trading, held-to-maturity and available for sale.

Held for trading:

These are securities which are either acquired for generating a profit from short-term fluctuations in market prices, interest rate movements, and dealers margin or are securities included in a portfolio in which a pattern of short-term profit taking exists.

Held to maturity:
These are securities with fixed or determinable payments and fixed maturity in respect of which the Group has the positive intent and ability to hold to maturity.

Available for sale:

These are investments, other than those in associates that do not fall under the held for trading or held to maturity categories.

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