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FINANCIAL INSTITUTIONS
IN
PAKISTAN
1FINANCIAL INSTITUTIONS IN PAKISTAN
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Finance
•Money used by a company, provided by
shareholders or by Loans.
•Money resources of state, company or person.
•The provision of Money when and where
required.
•The art and science of managing money.
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FINANCIAL INSTITUTIONS IN PAKISTAN 3
What is Market?
It is an institution through which buyers and
sellers meet to exchange goods, services, andproductive resources.
Types of MarketsThere are essentially three types of markets
within the global economic system.
1-The factor markets allocate factors of production (land, labor, skills, capital) and
distribute income (wages, rent) to the owners of
productive resources.
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2-Consuming units use most of their income
from factor markets to purchase goods and
services in the product markets.
3-The financial markets channel savings to
those individuals and institutions needing morefunds for spending than are provided by their
current incomes.
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Financial Asset
A claim against the income or wealth of abusiness firm, household, or unit of government
usually represented by a certificate, receipt,
computer record file, or other legal document,and usually created by or related to the lending
of money.
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How Financial Assets Are Born
To acquire assets, households and businessfirms may use current income and
accumulated savings – internal financing.
An economic unit may also raise funds by
issuing financial liabilities (debt) or stock
(equities), provided that a buyer can be found – external financing.
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What is Money?
All financial assets are valued in terms of money, and flows of funds between lenders
and borrowers occur through the medium of
money.
Money itself is a financial asset, because all
forms of money in use today are claimsagainst some public or private institution.
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The Functions of Money
Money serves as a standard of value (or unit of
account ) for all goods and services.
Money serves as a medium of exchange, such
that buyers and sellers no longer need to havean exact coincidence of wants in terms of
quality, quantity, time, and location.
Money serves as a store of value – a reserve of
future purchasing power. However, the value
of money can experience marked fluctuations.8FINANCIAL INSTITUTIONS IN PAKISTAN
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Money functions as the only perfectly liquid
asset in the financial system. It exhibits price
stability, ready marketability, and reversibility.
Different Kinds of Financial Assets
Accepted in payment for purchases of goods
and services is money. Currency and checking
accounts are forms of money. 9FINANCIAL INSTITUTIONS IN PAKISTAN
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Equities represent ownership shares in a
business firm and are claims against the firm’s
profits and against proceeds from the sale of its assets. Common stock and preferred stock
are equities.
Debt securities entitle their holders to apriority claim over the holders of equities tothe assets and income of an economic unit.They can be negotiable or nonnegotiable.Examples include bonds, notes, accountspayable, and savings deposits.
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Derivatives have a market value that is tied toor influenced by the value or return on afinancial asset. Examples include futurescontracts, options, and swaps.
FINANCIAL MARKETS FOR INVESTORS
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What is investment ?
Why invest ?
Where invest ?An Introduction to Financial Market
Types of Financial Market
What is Investment ?
Money we earn is partly spent and rest saved for
meeting future expenses. Instead of keeping thesavings idle we like to use savings in order to
get return on it in the future. This is called
Investment. 12FINANCIAL INSTITUTIONS IN PAKISTAN
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Why Invest ?
Earn Return on idle resources
Generate sum of money for specified goal inlife
Make provision for uncertain future
To meet the cost of inflation. An Introduction to Financial Market
In economics, a financial market is a mechanism
that allows people to easily buy & sell (trade)financial securities (such as stocks & bonds etc
), commodities (such as precious metals or
agricultural goods etc). 13FINANCIAL INSTITUTIONS IN PAKISTAN
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Types of Financial Market
Financial Market
Capitalmarket
Commodity Market
Money Market
DerivativesMarket
InsuranceMarket
ForeignExchange
Market
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Options for Retail Investor
Equity
DebtMutual Funds
Fixed Deposits with Banks
National Saving SchemesGold
Real Estate
Insurance
Commodity Foreign Exchange etc
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Equity Shares
• It commonly referred to as ordinary share
represents the form of fractional ownership ina business venture.
•
Equity shareholders have the right to getdividends as declared.
DEBT•
This instrument represents contract whereby oneparty lend money to another on pre-determined
terms with regards to rate and periodicity of interest,
repayment of principle amount by the borrower to
the lender.For exam le: COD, Bonds, TFC etc 16FINANCIAL INSTITUTIONS IN PAKISTAN
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Mutual Fund
A Mutual fund is a collective investment
vehicle that pools together investor money.This collective pool of money is invested in
accordance to stated objective.
Mutual Funds are :
A large pool of resources
Managed by professionalsDiversified investment for lower risk & better
return
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Fixed Deposits with Banks
It allows an investor to deposit a lump sum of
money for a fixed period ranging from a fewweeks to a few year and earn a pre-determined
rate of interest.
Guaranteed Returns depends upon term.Safe and Secured Investments
National Savings Schemes• National Savings Certificate
• National Savings Deposits
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GOLDPhysical Gold in the form of bars and coins
Gold accounts in banks where units in the gold a/c in
the banks are backed up by physical gold held in the
bank and bank gives assurance that the investor can
convert the gold back to cash anytime.
Real Estate InvestmentFinancial instrument that invests primarily in the real
estate such as offices, apartments, shopping centres,
hotels etc.Tend to pay high returns( often as high as 10%)
Attractive investment opportunity when the stock
market is falling.
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Insurance
A promise of compensation for specific
potential future losses in exchange for aperiodic payment. Now it is considered as a
investment tool also:
Traditional PlansCommodity
• Investment in sugar, cotton, rice, fertilizers,
wheat etcForeign Exchange
Investment in foreign currencies
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Conclusion
Investors looks at superior returns and measuredrisk therefore he has to select a dynamically
balanced asset allocation mix consisting of the
different investment options available in theFinancial Market.
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Financial Institutions
Financial institutions permit the flow of fundsbetween borrowers and lenders by facilitating
financial transactions
Institutions may be categorised by differences
in the sources and uses of funds
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C i f i i i i
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Categories of Financial Institutions
Depository financial institutionsInvestment banks and merchant banks
(money market corporations)
Contractual savings institutionsFinance companies
Unit trust
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Depository financial institutions
Attract savings from depositors and investors toprovide loan facilities to borrowers
Commercial banks
Building societiesCredit unions
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Investment Banks and Merchant Banks
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Investment Banks and Merchant Banks(money market corporations)
Mainly provide off-balance-sheet (OBS)transactions to corporations and government
Advice on mergers and acquisitions,
portfolio restructuring, finance and risk management
Provide some funding
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FINANCIAL INSTITUTIONS IN PAKISTAN
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FINANCIAL INSTITUTIONS IN PAKISTAN
PUBLIC SECTOR BANKS
FIRST WOMEN BANK LIMITEDTHE BANK OF KHYBER
NATIONAL BANK OF PAKISTAN
THE BANK OF PUNJAB
THE SINDH BANKTHE BANK OF SINDH
ISLAMIC BANKS
BANKISLAMI PAKISTAN LIMITED ALBARAKA BANK (PAKISTAN) LIMITEDBURJ ISLAMIC BANK LIMITEDMEEZAN BANK LIMITED
DUBAI ISLAMIC BANK PAKISTAN LIMITED 28FINANCIAL INSTITUTIONS IN PAKISTAN
PRIVATE BANKS
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PRIVATE BANKS
SAMBA BANK LIMITED
JS BANK LIMITED
ALLIED BANK LIMITEDKASB BANK LIMITED
SUMMIT BANK LIMITED
MCB BANK LIMITED
ASKARI BANK LIMITEDMYBANK LIMITED
ATLAS BANK LIMITED
NIB BANK LIMITED
BANK ALFALAH LIMITED
SILK BANK LIMITED
BANK AL HABIB LIMITED
SONERI BANK LIMITED
THE ROYAL BANK OF SCOTLAND LIMITED
STANDARD CHARTERED BANK (PAKISTAN) LIMITED 29FINANCIAL INSTITUTIONS IN PAKISTAN
FAYSAL BANK LIMITED
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FAYSAL BANK LIMITED
UNITED BANK LIMITED
HABIB BANK LIMITED
HABIB METROPOLITAN BANK LIMITED
FOREIGN BANKS
THE BANK OF TOKYO-MITSUBISHI UFJ LIMITED - PAKISTAN
OPERATIONSCITIBANK N.A. - PAKISTAN OPERATIONS
HSBC BANK MIDDLE EAST LIMITED – PAKISTAN
DEUTSCHE BANK AG - PAKISTAN OPERATIONS
BARCLAYS BANK PLC
OMAN INTERNATIONAL BANK S.A.O.G – PAKISTAN
OPERATIONS
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DEVELOPMENT FINANCIAL INSTITUTIONS
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DEVELOPMENT FINANCIAL INSTITUTIONS
HOUSE BUILDING FINANCE CORPORATION
PAKISTAN KUWAIT INVESTMENT COMPANY LIMITED
PAK BRUNEI INVESTMENT COMPANY LIMITEDPAK OMAN INVESTMENT COMPANY LIMITED
PAK IRAN JOINT INVESTMENT COMPANY
SAUDI PAK INDUSTRIAL & AGRICULTURAL INVESTMENT
COMPANY LIMITEDPAK LIBYA HOLDING COMPANY LIMITED
PAK-CHINA INVESTMENT COMPANY LIMITED
PAK BRUNEI INVESTMENT COMPANY LIMITED
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SPECIALIZED BANKS
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SPECIALIZED BANKS
INDUSTRIAL DEVELOPMENT BANK OF PAKISTAN
THE PUNJAB PROVINCIAL COOPERATIVE BANK LTD
SME BANK LIMITEDZARAI TARAQIATI BANK LIMITED
ARSLAAN BANK LIMITED
MICRO FINANCE BANKS / INSTITUTIONS
NRSP Micro Finance Bank Limited
The First Micro Finance Bank Limited
Khushali Bank Limited
Karakuram Bank
Network Micro Finance Bank
Pak Oman Micro Finance Bank
Rozgar Micro Finance Bank, Karachi
Tameer Microfinance Bank Limited
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Pakistan Investment banks
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Pakistan Investment banks
1. BMA Capital Management Limited
2. Invest Capital Investment Bank Limited
3. AMZ Securities
4. Orix Leasing (Pakistan) Limited5. Trust Investment Bank Limited
6. JS Investment Bank Limited
7. Atlas Investment Bank Limited
Discount and Guarantee Houses
1. First Credit & Discount Corp Limited
2. National Discounting Services Limited
3. Speedway Fordmetall (Pakistan) Limited
Pakistan Housing Finance Companies
1. Asian Housing Finance Limited
2. Citibank Housing Finance Company Limited
3. House Building Finance Corporation
4. International Housing Finance Limited 33FINANCIAL INSTITUTIONS IN PAKISTAN
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http://www.pakistaneconomist.com/database2/pakbanks.asp
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p p p p
http://www.viewsbuzz.com/list-of-all-banks-in-pakistan-commercial-national-investment-saving-
islamic-banks/
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