Final Project Report

ZARAI TARAQIATI BANK LTD.

Submitted to:

Prof. Farooq

Submitted by:

Arslan Ahmad

Reg#:

V1F15MCOM0003

MCOM: 2105-2017

 

ACKNOWLEDGEMENT

Every project big or small is successful largely due to the effort of a number of wonderful people who have always given their valuable advice or lent a helping hand. We sincerely appreciate the inspiration; support and guidance of all those people who have been instrumental in making this project complete.

At this juncture we feel deeply honored in expressing our sincere thanks to our great teacher Prof. Farooq for making the resources available at right time and providing valuable insights leading to the successful completion of our project.

I am the student of University of Central Punjab, Lahore, we are extremely grateful to Zarai Taraqiati Bank for the confidence bestowed in us and entrusting our project report.

Last but not the least we place a deep sense of gratitude to our family members and our friends who have been constant source of inspiration during the preparation of this project work.

Contents

1. Introduction

History

Reasons to change ADBP to ZTBL

Mission

Vision

Objectives

Head office

Branches

Board of Directors

2. Infrastructure of ZTBL

(i) Board of Committees

Audit Committee

Human Resource Management (HRM) Committee

Risk Management Committee

Information Technology (IT) Committee

(ii) Management Committee

Assets Liabilities Management Committee

Executive Coordination Committee

Organizational Structure

Shareholding

ZTBL staff college

Vision

Mission

Functions

Approaches of Training

Subsidiary (KSSL)

Audit Department

(i) Pre Audit

(ii) Post Audit

Contents

3. Products & Services of ZTBL

(i) Treasury

Scope and objectives of treasury

Investments as per investment policy

(ii) Deposit schemes

(iii) Loan schemes

Types of loans

Production scheme

Supervised agriculture scheme

Zarkhaiz (one window scheme)

Sada Bahar scheme

Tea financing scheme

Crop Maximization project

Development loan scheme

Types of security

Payments period

Recovery procedure

Other schemes

(iv) Hajj Scheme

(v) Locker Facility

Contents

4. Analysis

(A) SWOT analysis

Strengths

Weaknesses

Opportunities

Threats

(B) PEST analysis

Political

Economic

Social

Technological

(C) Financial analysis

5. Annual Report

6. Findings and Recommendations

7. Conclusion

1. Introduction: The Zarai Taraqiati Bank Limited (ZTBL) (formerly known as Agricultural

Development Bank of Pakistan) is the largest public sector financial development institution

in Pakistan. Authorized capital of ZTBL is Rs.25, 000,000,000/- divided into 2,500,000,000

ordinary shares of Rs.10 each. Paid up capital of ZTBL are 12,522,440,670/-. The bank

serves around half a million clients annually and has over one million accumulated account

holders and a wide network of 32 Zonal Offices, 9 Audit Zones and 408 branches in Pakistan.

The total number of employees is 5,326, while 982 employees is provided by the KSSL. The

ZTBL make investment in some listed companies such as Nestle Milk pak Limited, Uqab

Breeding Farm Limited, Mubarik Dairies Limited & Dadabohy Agriculture Leasing Limited

in order to generate profit.

History: Pakistan is basically an agricultural country, and finance has been needed for its rapid

development. With a view to meet this basic need the Agricultural Development Finance

Corporation was set-up in 1951, and was entrusted with the task of providing financial

facilities for the development of agriculture including:

Forestry

Fishery

Animal Husbandry

Poultry

Dairy Farming

Later on the Agricultural Development Bank of Pakistan was also established in

September 1957, under the Agricultural Development Bank Act. The Bank is to provide

credit in cash or in kind, warehousing and storage facilities to agriculturists, cooperative

societies and other bodies, of which the majority of members are agriculturists. As the

functions of the Agricultural Development Finance Corporation and Agricultural

Development Bank were similar and since both were working with

capital provided by the Government, they were merged into one organization known as

Agricultural Development Bank of Pakistan on February 18. 1961. The Agricultural

Development Bank of Pakistan is a banking company for the purpose of the Banking

Companies Ordinance and the State Bank of Pakistan Act. Zarai Taraqiati Bank Limited

(ZTBL) erstwhile Agricultural

DevelopmentBank of Pakistan (ADBP)is the premier financial institution geared towards the

development of agriculture sector through provision of financial services and technical

knowhow. The restructuring of former ADBP is being carried out with the aim:

To uplift the agriculture and rural sector by raising farm productivity.

Streamlining the institutional credit.

Increasing income generating capacity of the farming community.

ZTBL was incorporated as a Public Limited Company on 14th December,

2002through repeal of ADB Ordinance of 1961.

The new corporate structure redefines the bank's status as a Public LimitedCompany

registered under Companies Ordinance'1984with an independent Board of Directors which

aims at ensuring good:

Governance,

Autonomy,

Delivering high quality

Reason to Change ADBP to ZTBL: The restructuring of the former ADBP is being carried out with the aim to uplift the

agriculture and rural sector by raising farm productivity, streamlining the institutional credit

and increasing the income generating capacity of the farming community.

Mission:

To play effective role in the promotion of economic growth, by enhancing

theavailability of credit to the agriculture sector, through reliable access to sustainablefinanci

ng,special lending programs,technicalassistance, and otherproducts& services,and to promote 

career development opportunities for increasing professionalism and technical proficiencies

of employees.

Vision:  Dedicated to serve the needs of the farming community, by delivering

financial products and technical services on a competitive and sustainable basis, in a

convenient, efficient and professional manner, leading to success of the Bank and

the farmers.

Objectives:

Develop and operate as a financially and operationally sustainable R.F.I of the

country.

Assist rural community, particularly the small farmers, in raising their productivity

and income levels through timely delivery of credit, advisory and ancillary services.

Build ZTBL's image as a proactive, client friendly, financially & operationally

sustainable with indigenous product deployment.

Establish and provide backward and forward linkages to strengthen agri. value added

commodity chains.

Engage in public - private and wholesale - retail partnership to deepen outreach and

reduce operating cost.

To function as a rural commercial bank to mobilize rural capital formation and to

commercialize the agri. sector by delivering the true value of credit to the client.

Provide a wide range of risk insurance products to its clients.

Open up its venues of operation to Domestic & International Banking Industry to

avail comparative advantages.

Head Office:

Head office of ZTBL is located at Islamabad.

Board of Directors:

Mr. Mehboob Hussain (Seceratory)Mr. Asif Sharif

(Director)Mr. Asif Sharif (Director)

Mr. Saeed Ahmed Director)

Mr. Abdul Bari (Director)

Mr. Majyd Aziz (Director)

Mr. Mohsin Aziz (Director)

2. Infrastructure of ZTBL: The overall management, functions, meetings of the ZTBL is control by two committees

known as “Board & Management Committees”. The sub-committees of these two committees

are explaining as under;

(i) Board   Committees:

Audit Committee:

Mr. Zia ul Mustafa Awan (Director)

This committee has one chairman, four members that are the directors of the ZTBL and one

secretary from the Audit Department. The designation of secretary is the “Chief Internal

Auditor” of Audit Department.

Human Resource Management (HRM) Committee:

This committee has one chairman & president of the ZTBL, four members that are the

directors of the ZTBL and one secretary from the HRM Department. The designation

of secretary is the “Head” of the HRM Department.

Risk Management Committee:

This committee has one chairman & three members that are the directors of the ZTBL. But

one member designation is the risk manager. But in risk management committee, the

company secretary act as member and secretary as well.

Information Technology (IT) Committee:

This committee has one convener & two members that are the directors of the ZTBL. One

member is from IT Department & his designation is the Chief information officer. While one

secretary (Head) of IT Department.

(ii) Management   Committees:

Assets Liabilities Management Committees:

This committee has one convener (CEO) & three members. The designation of the first

member is the SEVP of Operation Department. The designation of the second member is the

risk manager. But the third member (Chief Financial Officer) acts as member and secretary as

well.

Executive Coordination Committee:

This committee has one

convener (CEO), one secretary (Compliance Officer) & three members. Thedesignation of

the first member is the SEVP. The designation of the second member is the EVP. The

designation of third member is the risk manager.

Organization   Structure   of   ZTBL: The general direction and superintendence of the affairs of the bank are entrusted to a

12 members Board of Directors consisting of a chairman appointed by the Federal

Government, the Federal Government officers from the Ministries of Finance and Food and

Agriculture. There are four officers of the four Provincial Governments and one non official

nominated by each province. One member on this board represents the State Bank of Pakistan

also. In ZTBL, the president supervises and directs the senior executive who supervises and

directs the senior vice president, and senior vice president control voice president, who

control Assistant vice president, who finally supervise officers. The management hierarchy of

bank is as follows;

Board of Directors

President

Committees of ZTBL

Shareholding of Zarai Taraqiati Bank Limited (as on 31.12.2012)

SR. NO. NAMES OF SHARE HOLDERS NO. OF SHARES AMOUNT (Rs).01 Government of Pakistan 1,251,189,067 12,511,890,67002 Government of Punjab 292,340 2,923,40003 Government of Sindh 125,545 1,255,45004 Government of KPK 71,740 717,40005 Government of Balochistan 37,875 378,75006 Government of Erstwhile East Pakistan 527,500 5,275,000

Total:- 1,252,244,067 12,522,440,670

ZTBL Staff College: Vision

Develop core and general competencies at different tiers of management, improve the

training infra-structure and develop the Staff College as Model Banking Training Institute of

the country. 

Objectives

(i) To unleash the hidden potential of the employees.

(ii) To identify and build right set of competencies in employees to optimize their

performance

Management Committees

Board Committees

Executive Coordination Committee

Assets Liabilities

ManagementCommittee

Audit Committee

HRM Committee

Risk Management

Committee

Information Technology Committee

(iii) To provide equal learning and development opportunities to employees across

the bank by enhancing their understanding of new Financial & Commercial products,

regulatory requirements and technological innovations for achieving future

organizational goals.

Functions

(i) Identify, develop and impart best possible training & development innovative

solutions.

(ii) Assess training & development needs of all employees in the Organization.

(iii) Ensure that the Bank possess trainers who are adequately trained to design,

deliver in accordance with the training & development programs.

(iv)Establish an environment for trainees conducive to learning.

(v) Liaise with all major training agencies, trainers & vendors to the Bank’s advantage.

(vi)Overall responsibility of implementation of HR policies and programs in areas of

training, development and career planning.

(vii) Obtain feedback on various HR policies, procedures and programs to

recommend improvements.

(viii) Evaluate, propose nominations for overseas training programs through

International Banking Institutes.

(ix)Plan, arrange and conduct induction courses for new inductees, at all levels.

(x) Arrange internships for students of HEC recognized Universities, in the field and at

Head Office.

(xi)Process and finalize Employees Education requests to encourage the Employee’s to

improve their academic / professional qualification not only for their career growth

but also to prepare the Human Resource of the bank to meet the future challenges on

self sustainable basis

Approaches of Training:

(i) Overview of subject presented by the Speaker/ Resource Person

(ii) Group discussions

(iii) Multimedia

(iv)Computer Lab Practices

(v) Case Studies

Subsidiary (KSSL): The ZTBL has one subsidiary which is known as the “Kissan Support

Services Limited”.  It was incorporated as owned subsidiary of the ZTBL thatfunction

independently effective from 1st January 2006. The KSSL is a separate and distinct legal

entity that is controlled by the ZTBL. The KSSL has an authorized capital of Rs.100 million.

Its aim is to provide a support to the management of the ZTBL such as to focus on core

banking business and assign non-core activities. The KSSL operates under the Memorandum

and Article of Association. 

Services:

Kissan Support Services Limited provides the following services to the Bank:

Sports:

ZTBL has been involved in different games activities and tournaments at national level. Being its noncore activity, the Bank handed over this responsibility to KSSL. To carry out sports activities, KSSL has developed sports department whose duty is to arrange

participation of ZTBL teams of cricket (men & women), Shooting Ball, Squash (Men

& women), Football, Tennis (men & women) and Golf at national level tournaments

organized by PCB and different Sports Federations of Pakistan. 

KSSL sports department also arranges Inter Regional/Inter Department competitions

to promote sports and recreational activities for Bank employees. Training camps are also

arranged for the players in order to keep them fit, physically as well as mentally.

Security Services:

Providing security services to ZTBL is a non core activity of the Bank which is given

to KSSL. To execute this responsibility, KSSL has its Security Department whose

responsibility is to undertake security measures for the protection of ZTBL’s assets,

employees and material. This department also maintains effective liaison system with Zonal

Offices, Staff, Customers, Government & Intelligence Agencies, and other Regulatory

Bodies. Physical monitoring by patrolling and check system, CCTV link up system, and

control room system are also developed by the Security Department of KSSL in order to

provide full proof security to the Bank.

Provision of man power:

Providing security services to ZTBL is a non core activity of the Bank which is given

to KSSL. To execute this responsibility, KSSL has its Security Department whose

responsibility is to undertake security measures for the protection of ZTBL’s assets,

employees and material. This department also maintains effective liaison system with Zonal

Offices, Staff, Customers, Government & Intelligence Agencies, and other Regulatory

Bodies. Physical monitoring by patrolling and check system, CCTV link up system, and

control room system are also developed by the Security Department of KSSL in order to

provide full proof security to the Bank.

Administrative Services:

Some of the administrative services were also handed over to KSSL by the Bank as its

noncore activities. These services include:

Provision of Janitorial Services to ZTBL building.

Photocopying services.

Provision of uniforms/liveries to Naib Qasids and Drivers.

Maintenance of security equipments.

Taking care of no profit no loss bases café for ZTBL and KSSL employees.

Sr. NO.

Categories of Employees Provided by KSSL

No. of Employees

01 Darban and armed Guards 526

02 Drivers 291

03 Naib Qasids 25

04 Mali 25

05 Typists, Assistants and senior assistants. 41

06 Security supervisors 03

07 Sweepers 07

08 Players 20

09 Others 15

Total 982

Audit Department:

(i) Pre Audit:

Ensure availability of sanction of the Competent Authority.

Ensure all government, regulatory and statutory requirements are being fulfilled.

Ensure all BOD decisions are being followed while making payments.

Ensure Competence vis-à-vis Financial Power of Approving Authority.

Check Budget availability of the concerned GL Head.

Check completeness of documentation and verification of arithmetic accuracy.

Check Procedural Compliance.

Perform any other assignment as & when assigned.

(ii) Post Audit:

Review compliance with all the policies and procedures in place.

To know all the relevant instruction applicable on KSSL.

Report results and make recommendations to the management whenever necessary.

Follow up on the process of implementation of the recommendations.

Ensure that all internal control procedures are effectively enforced.

Ensure proper vouching/book keeping is maintained. Ensure booking of transactions

in proper GL Heads and availability of supporting documents.

Ensure that the payments are made as sanctioned by the Competent Authority and

pre-audited.

3. Products and Services of ZTBL:

(i) Treasury:

The Treasury Division of ZTBL was formally established on May 08, 2012 after the

approval of Board of Directors (BOD). To run treasury operations on professional grounds,

BOD also approved Treasury Investment Policy, Treasury Manual, and Contingency Plan

and Brokerage lines. It has been ensured that Treasury Division (TD) will strictly work under

approved policies and guidelines for BOD and will operate within pre-specified line and

limits. It is responsibility of each member of treasury division to ensure compliance of terms

and conditions laid down in this policy documents according to his/her role and as defined in

Treasury Manual and their specific job description. All funds available to TD will be utilized

optimally, timely and in a professional manner. Any exception may be granted based on its

rationale and justification and prior approval from ALCO. 

The objectives of the above policy documents are to define the minimum standards

and controls that need to be complied to cover risks while placing, investing or borrowing

funds. These risks relate to interest rate risk, market risk, exposure risk, and liquidity and

delivery risks. Therefore, it is an area where significant control and review measures need to

be adopted by concerned departments/division specifically and by ALCO in general.

Scope & Objectives of Treasury Division :

The Scope and objectives of Treasury Division covers all the Treasury & Investment

related activities within ZTBL; whereas the main objectives are as under:

(i) To maintain sufficient liquidity for the bank to honor its commitments as they fall

due.

(ii) To maximize overall return on managed assets.

(iii) To manage liquidity, utilizing excess funds efficiently and arrange/borrow in

case of anticipated shortfall

(iv)To keep ZTBLs funding cost as low as possible.

(v) ZTBLs ability to withstand immediate liquidity shocks or longer term liquidity

management problems depend on its capacity to make rapid decisions using factual

data and take timely actions to bridge the funding gap.

(vi)To establish appropriate early warning signals that will help in identification of the

liquidity problems.

(vii) To maintain liquidity in accordance with regulatory requirements.

Investments as per investment policy:

(i) Government Securities which includes Treasury Bills (T-bills), Pakistan Investment

Bonds (PIB) and GoP Ijara Sukuk.

(ii) TDRs

(iii) Certificate of Investments

(iv)To keep ZTBL's funding cost as low as possible.

(v) Certificate of Musharika/Modaraba

(vi)Term Finance Certificates (TFCs)

(vii) Corporate Sukuk

(viii) Mutual Funds Investments

(ix)Equity Investment

(x) Money market activities, Reverse Repo/ Repo/Clean/Call etc

(ii) Deposit Schemes:

Current Account

PSL- saving Account

Business Deposit Account (Special Account A/C)

Rozana Bachat Account (Special Account A/C)

Basic Banking Account

PSL- Term Deposit

Zarai Munafa Term Deposit Certificate (ZMTDC)

MINFA Revolving Fund Deposit A/C (MRFDA)

MINFA Special Saving Deposit A/C (MSSDA)

Types of Deposits Rate of Return Terms & Conditions

CURRENT A/C NIL

1. Initial deposit is Rs.200/- 

2. Un-remunerative charges

@ Rs.50/- pm shall be

deducted on half yearly basis. 

3. Non Remunerative

Account.

4. No limit of transactions.

PLS-SAVING A/C (Regular

Saving A/c)

7% pa

1. No initial deposit.

2. Max. 8 debit transactions

during the month are allowed

for calculation of profit.

3. Profit shall be calculated on

the basis of average balance

during the month.

4. Profit shall be credited to

a/c on half yearly basis.

BUSINESS DEPOSIT A/C

(Special deposit A/C)

7% pa

1. Initial deposit is

Rs.10,000/- 

2. Profit shall be calculated on

the basis of daily product. 

3. No limit of withdrawals. 

4. Profit shall be credited into

account on half yearly basis.

ROZANABACHAT A/C

(Special deposit A/C)

7% to 8% pa (slabs from

Rs.10000/- to Rs.10 million )

BASIC BANKING A/C NIL

1. Min. initial balance is

Rs.1000/- 

2. It is non-remunerative a/c. 

3. Max. two deposit & two

chequing withdrawals during

a month are free of charge

4. If balance remains NIL, for

continuous period of 6 Month

such account will be closed.

PLS-TERM DEPOSIT ( slab

rates per circular )

7% TO 8% (terms 3 months

to 60 months & above)

1. Min. initial balance is

Rs.1000/-. 

2. Minimum holding is 3

months. 

3. PLS saving a/c rate shall be

applied in case of premature

encashment & after

maturity. 

4. Request of roll over shall be

made in sufficient time before

its maturity otherwise it will

be transferred to TDR

Matured a/c

1. Initial deposit if 0.100

million. 

2. Scheme is restricted for

Bank employees & their

ZARAI MUNAFA TERM

DEPOSIT CERTIFICATE

(ZMTDC)

8% relatives. 

3. Profit shall be paid at

maturity. 

4. Premature encashment OR

after maturity PLS-Saving a/c

rate shall be applied.

5. Deposit of this scheme shall

not fall into the ambit of ROs

performances.

MUSTAQBIL MEHFOOZ

A/C

8%

1. Short term deposit scheme

for a fixed period of 3 and 6

months. 

2. Min. deposit is Rs.50,000/-. 

3. In case of premature

encashment OR after

maturity PLS-saving a/c rate

shall be applied.

ZARAI TERM DEPOSIT

CERTIFICATE (ZTDC)

7.60 % pa(Irrespective of

premature period)

1. Minimum deposit is

Rs.25,000/- 

2. Scheme is for a fixed period

of 3 years. 

3. Minimum holding is 3

months 

4. If depositor maintains

Rs.2,00,000/- , he will be

eligible to get agri. Loan from

ZTBL without any appraisal

fee.

MINFA REVOLVING FUND

DEPOSIT A/C. (MRFDA) 7.5% pa

1. Minimum deposit is

Rs.500/- 

2. Introduced for village

organizations only.

MINFA SPECIAL SAVING

DEPOSIT A/C (MSSDA) 7.5% pa

1. Minimum deposit is

Rs.500/- 

2. Introduced for village

organizations only.

(iii) Loan Schemes: Zarai Taraqiati Bank Limited (ZTBL) is a specialized bank providing

agricultural credit in rural areas of the country. Pakistan is an agricultural country and near

about 60% of its population is working directly or indirectly related to agriculture industry.

But instead of being an agricultural country Pakistan is still not gaining benefits from

this sector which it can gain. Some time we even does not able to fulfill our food requirement

and sometime we have bumper crop but does not have facilities to store them properly, in this

way we are wasting our resources. To gain benefit from agriculture sector it is required to be

modernized to increase the per acre production and also to build ware houses to store. The

main hindrance in the modernization

of agriculture is the unavailability of finance. The other financial institutions feel reluctant in

giving finance to farmers due to high level of risk in the production of this field. To facilitate

farmers and to help in modernization of agriculture sector the government has established

this bank which is contributing its part in achieving government objective from many

decades. ZTBL is offering a blend of products to fulfill the need of different types of

customers.

Types of Loans

1. Short   Term   Loans:

Short term loans are loans for shorter period of less than a year. It includes, crop prod

uction working capital loans recoverable in lump sum commencing after theharvest/

marketing of respective crops and within maximum period of 12 months.

2. Medium Term   Loans:

Medium term loans are for a period of more than a year but less than 5 years. In

includes, dairy farming and livestock etc. The installments of these loans are usually paid

able in quarterly or half yearly basis.

3. Long   Term   Loans:

Long term loans are for a period of more than 5 years. These are development loans which

require large amount and also need some time to show its result in the shape

of better production. It includes loans for tractor, agricultural machinery, poultry farming, go

downs and orchard in yearly/half yearly installments within maximum period of 8 years.

Production Scheme:

The examples of production loan items are given below:

1. Seeds, fertilizers and fuel

2. 2.Pesticides, insecticides and herbicides manual sprayers

3. Poultry feed, chicks and medicines

4. Hire charges of farm power 

5. Water charges and electric charges for tube well

6. Production loan for growth of mushroom

7. Hired labor, water rates & fuel wood for tobacco curing.

Supervised agriculture scheme:

Under this scheme agriculture loans are given for short, medium and long term loans

up to Rs. 1.00 million per borrower/per case.

The loans are sanctioned for In Fats, livestock, orchard, tractor, agricultural machinery, tube

well and irrigation facilities etc. under the scheme besides provision of credit, information are

provided to the farmers for planning the farm, production, guidance for implementation of the

scheme, marketing and repayment of loans.

Zarkhaiz (one window operation):

For timely and conveniently provision of credit to purchase inputs,loans are provided 

to the borrowers under One Window Operationbeing conducted twice a week during Rabi an

d Kharif seasons.Applications processed on the same day whereas sanction payments are

made within three days at Branch. For Rabi Crops one window operation from October to

January and for Kharif Crops from April to

September each year which is extendable as per requirement of popular area.

Sada Bahar scheme:

For providing timely input loans for crops and working capital forpoultry and fishery etc,

the Bank has launched a Sada Bahar Scheme. Assessment for inputs requirements for the

whole year is made at the time of first application.  The amount so assessed is treated as

Revolving Limit provided it is within the security limit. The Managers are authorized to

sanction such loan limits up to Rs.O.500 million. Scheme’s main features are as under:

• Revolving Credit Limit is fixed to cater production credit andancillary requirements of the

farmers during one year period.

• The documentation once completed remains applicable for three

years with yearly cleanup/renewal without any further documents.

• The borrowers can draw the credit in lump sum or in installments according to

his requirement.

• Like-wise he can repay in lump sum or in installments during the year when his cash

position allows him.

• Pass Book containing transactions in his SBS Account is supplied to every borrower free of

cost.

Tea financing scheme:

In order to increase the tea cultivation in District Mansehra, Swat,Mutta, Shangla par and Dir

in Malak and Division, tea financing

schemehas been introduced which would not only save the hard earnedforeign exchange but 

would also help improve the socio-economiccondition of the inhabitants of the area. The

salient futures of the scheme are given as under:

• Maximum Credit Ceiling of Rs.60, 000/- per acre has been fixed.

• Farmers owing land up to five acres are eligible to avail loans.

• Credit will be given in 3 installments: first year Rs.30,

000/-,2nd year Rs.15,000/- 3rd year Rs.15,000/- provided thedisbursed loan is used properly.

• The credit would be repayable within 1 year with 6 years

grace period with prescribed markup of 9% per annum.Rebate of 1 % will be allowed

in mark-up on timely repayment and proper utilization of the loan.

Crop maximization project:

Ministry of Food, Agriculture and Livestock (MINF AL), Government of Pakistan

had launched Crop Maximization Project in 109 villages in

various districts throughout the country to increase the productivity/yield of crops. Under the

project MINFAL had to provide funds of Rs, 299.893 million to ZTBL for disbursing loans

to the project farmers for purchase of inputs. Initially funds of Rs.468 Million had been

received by the Bank for the purpose. These funds were to be revolved for meeting input

credit needs in the project village’s till 30th June, 2014 after which Bank had to return the

principal amount to MINFAL. Accordingly Credit needs of the project farmers are being met

by respective ZTBL branches through Village Organizations formed for the purpose. Duly

the currency of the project Bank is authorized to charge 4% per annum mark-up on loans to

project growers to meet its operational cost, however in case of default Bank’s normal rate of

return i.e. 9% p will be applicable.

Development Loan Scheme:

The loans for purchase of items like farm machinery, tractors, irrigation, land

development, orchard, green houses, dairy, poultry, fishery, livestock, farming…..etc

are recoverable up to one to eight years.

Per Acre Credit Limits

Major Crops

Wheat 16,000

Paddy (Rice) 19,000

Sugar Cane 30,000Cotton 21,000

Maize 20,000

Minor Crops

Overall Credit Limit per Borrower Rs. 1.000 Million

Sada Bahar Scheme Rs. 0.500 Million

Potato 36,000 Bajra 11,000

Tobacco 29,000 Jawar 11,000

Mustard Mug 11,000 Gram 12,000

Tomato 19,000 Guar 3,000

Mash 3,000 Caster Oil 6,000

Lentil 11,000 Barley 9,000

Groundnut 14,000 Berceme 49,00

Sunflower 15000 Janter 4,000

Soya Bean 12,000 Garlic 26,000

Canola 13,000 Turmeric 25,000

Rape Seed 11,000 Ginger 30,000

Till (sesame) 12,500 Lacern & Shaftal 45,00

Sugar Beet 12,000

Types of Security Immovable Property

Agricultural Land

• Under Pass Book System 80%

• Outside Pass Book System 70%

• Under Alienability Certificate 66%

• Commercial/Industrial Land under Pass Book 80%

Outside Passbook System

• Urban Residential/Commercial Plots in all localities outside Pass Book 75%

• Alienability Certificate 66%

• Residential/Commercial Buildings 70%

• Lease holds rights of a leased land of CDA/KDA with 99 years lease70%

Moveable Property and Guarantees

1. Unconditional Bank guarantee from scheduled Banks

Up to maximum amount of an un-conditional Bank guarantee after keeping sufficient margin

for un-paid mark-up, cost, charges and expenses.

2. Guarantee issued by Central or Provincial Government

Full amount of loan and other charges are guaranteed.

3. Government securities

85% of face value or market values whichever is less.

4. Defense Savings & FEB Certificates

75% of value of certificates presented as security.

5. Fix Term Deposits Recipients

85% of face value of deposits receipts.

6. NIT Units

80% of the face value or market values whichever is less.

7. Life Insurance policies 

85% of surrender value

8. Pledge of Potatoes/Seed Potatoes price or market value whichever is less

Up to 75% of Govt. support.

Personal Surety

Against a bond with two sureties under General Credit and one surety in

Special Schemes up to Rs.25,000/- or Up to 50% of appraised value of properties of sureties

Repayments Period

Sr. No. Types of Loans Recovery Period

1. Short term loansCrop production working capital loans recoverable lump sum commencing after the harvest/marketing of respective crops and within maximum period of 12 months.

2. Medium term loans Dairy farming and livestock etc. In yearly/ half yearly/monthly installments and within a period of 5years.

3. Long term loans Tractor, agricultural machinery, poultry farming go downs and orchards in yearly/ half yearly installments within maximum period of 8 years and above.

Recovery Procedure a) Recovery Schedule

• Recovery schedule in each loan case as per terms of sanction

of loan is fixed and communicated to the borrowers afterdisbursement of loan.

• In case of default or failure in repayment of any installment ondue date the mark-

up shall continue to be charged and lastinstallment due to this may differ from the amount of 

installments fixed at the time of disbursement.

b) Issuance of Notices

• Demand notice is issued before the due date of every installment.

• A Legal Notice is issued one month after the due date informing the borrower that if the

amount is not repaid within next one month, further legal action will be taken to recover the

dues.

c) Legal Action

• Legal action can be initiated against the defaulter if loan is not repaid even after expiry of

legal Notice period.

• Where the court in bank's favor has decreed a case, account isto be settled by recovery of

amount from the auction of them or tagged property.

• The bank may purchase the mortgaged property if

consideredfeasible to dispose it off later on through auction or in any manner deemed fit for

getting the best price.

• The bank may dispose of the mortgaged properties of defaulters for satisfaction of its dues

without intervention of courts

underFinancial Institutions (Recovery of Finances) Ordinance2001.Rescheduling of Loan

Repayment Facility.

d) Rescheduling of Loan Repayment Facility 

• ZTBL allows rescheduling of repayment of installments to itsborrowers in order to maintain

credit discipline and to

mitigatetheir genuine problems in real hardship cases and in areasdeclared as calamity hit by t

he respective ProvincialGovernments

• The Rescheduling facility is to be considered by bank on case to-case basis and is to be

allowed on borrower's request only.

• The relaxation in recovery period shall not be allowed beyond one year in any case.

• The borrowers shall have to execute a supplementary loanagreement on Non Judicial

• Stamp Paper of appropriate value to give legal cover to extended period.

• The borrowers shall have to pay the return for the extended period.

e) Down Payment for Rescheduling of Loans

Rescheduling Number

Rate of down payment as against due

installments to the rescheduled

1st 10%

2nd 20%

3rd 30%

Other Schemes:

(iv) Hajj Applications:

(v) Locker Facility: Zarai Taraqiati Bank Ltd. apart from its core functional activity marked with country

based agri-business, has started to serve its valued customers by offering lockers facility.

Initially, this facility is being offered at following 12 branches:

S.No Name of Branch Phone No. Address

1 H.O Branch Islamabad 051-9252782 Head Office Building, 1 Faisal Avenue Zero Point Islamabad

2 Islamabad Branch 051-9252022 Block-7/F, ZTBL Officer Colony G-7/2, Islamabad

3  Lahore Branch 042-7353380 47-C, Sharah-e-Quaid-e-Azam, Lahore

4 Peshawar Branch 091-2262279 Chughalpura, GT Road Reshawar

5 Gujranwala Branch 055-9200206 D.C Road, Gujranwala

6 Faisalabad Branch 041-9210008 Opposite Punjab Medical College, Faisalabad

7 Multan Branch 061-9200509 61-A Abdali Road, Multan

8 Sahiwal Branch 040-9200424 915-D Block Farid Town Sahiwal

9 Sargodha Branch 048-9230491 Katchery Road, Sargodha

10 Khan Pur Katora Branch

068-5573079 Model Town- Near Paradise Cinema Khan Pur Katora (RYK)

11 Shafi Court Branch 021-99206006 Shafi Court Building Mere weather Road Karachi South

12 Main Branch Gulshan-e-Johar

021-34613618 St 4/3-A Block No.1 KDA Scheme-36 Gulistan- e -Jauhar Karachi

Following are the approved rates for rent of lockers and key deposits against which lockers will be allocated:

Type Specification Rent Per Annum Rent after one month from due date Key Deposit

Small 6-1/2"x4-1/2"x23"

Rs.1,200/- Rs.1,500/- Rs. 5,000/-

Medium 13-1/2"x4-1/2"x23"

Rs.1,800/- Rs.2,250/- Rs. 10,000/-

Large 13-1/2"x8-1/2"x23"

Rs.2,500/- Rs.3,125/- Rs. 15,000/-

Break Opening charges is Rs. 1500/- or Actual which-ever is higher

4. Analysis Introduction:

The analysis is a tool, which is used for checking the overall performance of any

organization. It is not only used on national level but also on international level for the

purpose of  checking internal and external factors that influence the organization, positively

or negatively and leads the organization towards failure to success.

There are various analyses, such as the SWOT and PEST.

(A) SWOT   Analysis: The word “SWOT” is abbreviated to strengths, weakness, opportunities and threats

while analysis is a tool, which is used for checking the overall performance of any

organization. The SWOT analysis is strategic  tool used to evaluate the

overall organization’s strengths, weakness, opportunities & threats and involves specifying

the objective of the organization and identifying the internal and external factors that are

favorable and unfavorable to achieve that objective.

The SWOT analysis is designed to lead an organization from failure to success.

Finally, we do the strength & opportunities because it is helpful while we avoid the

weaknesses and threats which are harmful for organization, which is shown in below figure.

Threats

Weaknesses

Opportunities

Strengths

Harmful

External

Threats

HelpfulInternal

Threats

1. Strengths: Strengths are the attributes of the organization which are helpful in achieving the

objective. In other words, strengths mean, the activities that an organization does well

favorable chances or positive factors in the internal environment due to which organization

achieve the objective. The strengths of the ZTBL are given as under;

(i) Strong   Supervision   and   Management:

The supervision and management of the ZTBL is very strong such as step by step,

effective and efficient that leads the bank toward failure to success.

(ii) Provide   many   Facilities for Employees:

ZTBL provides the facility of health, safety and employee relations & training for the

purpose of maintaining the employees.

(iii) Employee’s   Traits:

All staff members are well mannered in attitude, communications & following the ethics.

(iv) Risk   Management:

  The risk management of the ZTBL is still in the process of restructuring and efforts

have been put in place to adequately equip the risk management function with credit review,

credit risk rating and value at risk models. Pakistan is an agriculture country with major

portion of its economy dependent on agricultural sector. ZTBL recognizes this responsibility

and thus also caters to agriculture sector which promises high returns.

(v) Expansion of ZTBL:

ThreatsOpportunities

External

Threats

The ZTBL is expanding day by day because customer accepts it. Its network expanded to

406 branches and 32 zonal offices in the Pakistan, which will attract large number of

customers.

(vi) The   Elevator   and   Cameras   Systems:

In the age of globalization, the elevator makes it possible to save time. While the cameras

in ZTBL, make the employees to stress on their work which is assigned or given.

2. Weakness:  The attributes of the organization which are harmful in achieving the objective are

calledweaknesses. In other words, weakness means, the activities that anorganization lakes or 

unfavorable chances or negative factors in the internalenvironment due to which organization

do not achieve the objective. The weakness of the ZTBL is given as under;

(i) Understaffing:

The total number of employees is 5,326 in the ZTBL Head office. In age of technology

and globalization, the understaffing may cause unnecessary work burden on employees

decreasing their efficiency.

(ii) Lack of Refreshment Courses:

Although the ZTBL has its own Training and Development Canter

but it needs to give refreshment courses to its employees more frequently so that they can

explore new dimensions and conquer worlds.

(iii) Seniority Based Promotion:

Promotion in the ZTBL is purely on seniority basis rather than on performance. This

really de-motivates the employees because they know that it doesn’t matter whether they

perform well or bad.

(iv) Lake of Job Rotation:

Most of the employees work in a particular department and they specialize only in one

department. In case of absence of one employee, any other employee cannot perform this

work. In this way bank not only loses the business but also results in dissatisfaction of the

customer.

(v) Shortage of skillful Labor:

The shortage of skillful labor or manpower leads the organization from success to failure.

Because in the ZTBL, there are many contract and temporary based employees that has lake

of managerial& financial skills.

(vi) Lake of Qualification:

The employees working on the same position may have different degrees like B.Sc., B.A.

… etc which devaluate the students of MBA, BBA, and other well qualified staff.

So there is a lack of professional

staff in different departments and lack of theoretical knowledge of the employees as well.

(vii) The Rate of Absenteeism and Turnover:

The absenteeism & turnover rate is too high that it results the conflicts in the

organization.

3. Opportunities:   The attributes of the organization which are helpful in achieving the objective are

called opportunities. In other words, opportunities means, the activities that an

organization does well or favorable chances or positive factors in the external environment

due to which organization achieve the objective. The opportunities of the ZTBL are given as

under;

(i)  Proper Utilization of Recourses:

The Organization is made up three types of recourses, such as human, physical &

financial resources which come from external environment. However, in the age of

globalization for achieving growth, the competent, skillful and the English speaking

employees are one of the requirements of the organization.

(ii) Increasing Extensive Advertisements:

The ZTBL can increase the extensive advertisements of new products, services,

vacancies, in order to increase customers & heir competent employees from external

environment.

(iii) Mobile Credit:

The ZTBL can start mobile credit which is the best way to effectively utilize its present

resources to gain a competitive edge.

(iv) Increasing the Amount of Loans and Capital:

The ZTBL increases the amount of loan for their customers, which is five lacks, in

order to attract the large number of customers. The ZTBL issue a large amount of capital to

agriculture sector, in order to, utilize its resources more efficiently and to earn more profit.

(v) Creating Public Relations:

The ZTBL also, involves in creating public relations that will increase the image and

profitability of the bank. Often, public relations are conducted through the media that is,

newspapers, television, magazines, internet….etc that’s attract a large number of customers.

4. Threats:   The attributes of the organization which are harmful in achieving the objective are

called threats. In other words, threats means, the activities that an organization lakes or

negative factors in the external environment due to which organization do not achieve the

objective. The threats of the ZTBL are given as under;

(i) Avoid Discrimination:

The ZTBL can avoid discrimination because it is harmful for the bank in achieving its

objective. The bank can hire the employees from external environment. The right person is

for right for job will leads the organization towards failure to success.

(ii) Avoid Illegal Activities:

The employees of the ZTBL can avoid the illegal activities in external environment

that will reduce the reputation and image of the ZTBL.

(iii) Internet Banking:

It is the main problem that was found to be a lack of trust in the new banking channel

by customer. However, effective complaint management

can increase customer’s loyalty and trust in Internet Banking. 

However, “Crises Management Plan” has been developed which is under review by

the senior management. The objective of this plan is to have clear guidelines and

communication in the event of any crises occurrence, which may threaten the safety of its

staff, the security of its assets, the continuity of its operation and the reputation of the ZTBL.

PEST Analysis:

1. Political analysis:Despite all international and public perceptions today, Pakistan is a functioning

democracy and gradually there is a change in complexion and composition

legislatures with more educated people and women entering into politics. Similarly it

helps in developing best strategies to implement that can support the revival of bank

industry. Like in the era of nationalization bank had to suffer as other industry that is

why the impact is still found in the performance of this industry.

2. Economic analysis:Although banking sector development is important at early stages of economic

growth, general liberalization presuming a homogeneous bank role may not

necessarily promote growth. The estimated cost structure indicated that state-owned

commercial banks are large enough, while development financial institutions and

private banks can expect to obtain cost saving advantages by expending their

operations. Since scope economies are significant, portfolio diversification generally

increases bank profit. In addition, private bank are the most efficient, followed by

foreign and private banks. Public banks are the least efficient.

3. Social analysis:Banks have always been helpful for the people in improvement of living condition of

poor people in various forms like giving loans for starting business or directly providing them

the instruments that could enhance their living conditions. Similarly ZTBL always tried to

provide loans to the needy people on soft terms and also helped to eradicate unemployment

by providing job opportunities.

4. Technological analysis: There is inadequate communication infrastructure.

Smaller and lowest computer facilities.

Inadequate IT training.

There must be an efficient IT department.

(C) Financial analysis:

Financial Analysis is the most important analysis which is conducted to check the

financial position of any organization. The brief financial analysis of Zarai Taraqiati Bank

limited.

Zarai Taraqiati Bank Unconsolidated Condensed Interm Statement

Financial Position as at 31 March 2014.

Un-Audited

31st March 2014

Audited

31st March 2013

Total Assets 142,615,634 148,448,277

Total Liabilities 109,435,609 115,965,018

Net Assets 33,180,025 32,483,259

Zarai Taraqiati Bank Unconsolidated Condensed Interm Profit and Loss Account for Three Months Period Ended 31st March 2014

March 31st 2014 March 31st 2013

Total Profit 265,083 269,833

Quarter Ended

Zarai Taraqiati Bank Unconsolidated Condensed Interm Statement of Comprehensive Income for Three Months Period

Ended 31st March 2014

March 31st 2014 March 31st 2013

Total Comprehensive Income 696,766 511,178

Zarai Taraqiati Bank Unconsolidated Condensed Interm Cash Flow Statement for Three Months Period Ended 31st March 2014

March 31st 2014 March 31st 2013

Cash Flow from Operating Activities (6,971,265) (1,701,444)

Cash Flow from Investing Activities 1,782,548 (5,553,041)

Cash Flow from Financing Activities 7,553,037 5,270,582

6. FINDINGS & RECOMENDTIONS

A single visit of a single branch of an organization can never provide all the

information about that organization. So we have found only some of the problems which

have been pointed out. We have also recommended some possible solutions of these

problems. The finding and recommendation for ZTBL are given as under;

Findings:

I. The employees working on the same position may have different degrees like B.Sc., B.A.

… etc which devaluate the students of MBA, BBA, and other highly qualified staff. So there

is a lack of professional staff in different departments.

II. There is no job rotation for employees which create job burning.

Quarter Ended

III. The absenteeism & turnover rate of the employees is too high that’s results the

misunderstanding and conflicts in the bank.

IV. In the ZTBL, there is problem is understaffing of employees. The total number of

employees is 5,326 in the ZTBL Head Office. In age of technology and globalization, the

understaffing may cause unnecessary work burden on employees decreasing their efficiency.

CONSLUSION:During our assignment on ZTBL, we found that ZTBL has high level of

professionalism and challenging environment and its culture is friendly. ZTBL seems Top

Agriculture Financing in the future as indicated by the financial indicators. It keeps energy

and potential to serve the deserving clients in all over the world. The bank has set itself a

vision to be a world-class bank.

This can only be achieved with dedication and a passion to excel in every activity.

The bank is really working well and contributing a valuable part in the economy of Pakistan

through tax, giving loan to government, giving loans to the businesses for their survival and

expansion, generating a well skilled human resource and employment etc. We have learnt a

lot during this assignment.

Recommendations

ZTBL should improve the Management system. They should be employee and

customer oriented. They have to introduce the dress coat into the organization. Loaning

procedure should be easier and convenient to the customers and easy processing system.

They should adopt the new agriculture technology for the high level production to increase

the GDP level of the country. ZTBL has to play vital role for introducing new energies to

overcome the problems of the fuel and bio gas. Political involvement should be eliminated so

that they can take good decision and actions for the better disbursement. Marketing

department should play vital role for introducing new products. They should also play role

for advertise their products and features and functions of the products. ZTBL Head Office has

to update the annual reports and manuals annually. They should hire the employee on the

merit basis. Their employees should have knowledge about their organization and about its

department where they are working. Employees should be qualified and productive.