INTERNSHIP REPORT ONHABIB BANK LIMITEDG.T. ROAD BRANCH GUJRAT

MBA(finance)UNIVERSITY OF GUJRATSCIENCE COLLEGE EVENING CAMPUS

INTERNSHIP REPORT ON HABIB BANK LIMITED G.T. ROAD BRANCH GUJRAT

Internship Report submitted to the Department of Administrative BusinessIn Partial Fulfillment of the Requirements for the Degree ofMaster of Business Administration

ACKNOWLEDGEMENTAll praises and thanks for Almighty Allah who is entire source of knowledge and wisdom to mankind. Who gave me the strength, patience, courage and enthusiasm needed to write and complete this report, then to my friends who assisted me in this effort and we worked daylong to accomplish this assignment and to my parents who supported me financially and encouraged me morally.I worked in the different department of the Habib Bank Limited branch G.T. Road Gujrat of Pakistan for the aim to get the practical knowledge. The employees of the HBL are very cooperative who provide me all the necessary information required to me for the completion of the report.It was pleasure for me to be sent to the HBL branch G.T. Road Gujrat. I am very thankful to the honorable internship incharge. It was a very healthy activity for me.The preparation of this report was a massive undertaking but the highly competent and experienced bankers of HBL branch G.T. Road Gujrat. Provided me with all assistance, information, advice and suggestions that I needed which contributed essentially to this report.

Executive Summary:This report is for academic purpose. In this report I have mentioned the history, role of organization in Pakistan, network, working of different departments, particular information regarding the HBL branch Gujrat, organizational structure, polices, strategies, SWOT analysis, PEST analysis, Ratio analysis of HBL, and different problems of HBL and recommendations. For this report I gather information from Branch Manager and also searched at internet and collect information about organization.Every student of Master in Business Administration at University of Gujrat has a necessary requirement to do Six to Eight weeks internship in any of the well reputed organization. The purpose of this program is to acquaint the students with practical applications of theoretical concepts taught to them during conduct of their MBA program. Really, it was a nice opportunity to have a close comparison of theoretical concept in practical field, involving the use of primary and secondary data. All the efforts on the way are summarized in shape of this Internship Report. This report has different chapters and each chapter contains information regarding the particular area. Not only is the introduction of internship report given but the introduction of HBL.The word 'Bank' is said to have been derived from the words Bancus or Banque or Bank. HBL was the first commercial bank to be established in Pakistan in 1947. Over the years, HBL has grown its branch network and become the largest private sector bank with over 1,450 branches across the country and a customer base exceeding five million relationships. HBLs branch network is extended all over the Pakistan which has its competitive edge over all other private sector banks in Pakistan. At the end of this report I have given my suggestion for the improvement of the bank.

Table of Contents1INTRODUCTION TO THE REPORT91.0Background of this study:91.1The purpose of this study:101.2Scope of the study:101.3Objective of the study:101.4Methodology of the study:111.5Organization:111.6 Summary:122INTRODUCTION TO HBL132.1Overall respective sectors in Pakistan:132.2Role of the organization in Pakistan:142.3 Overall organization and functions of org in Pakistan15HBLs Vision, Mission and Values:15ORGANIZATIONAL LEVEL172.4 STRUCTURE & FUNCTIONS OF HBL18OBJECTIVES OF HABIB BANK LTD.19SERVICES OFFERED BY HBL:202.5Organization office in which you are working:202.6Summary213Introduction of HBL My Branch 1449:223.1HISTORY AND BACKGROUNG:233.1.2 Relationship of head office to the branch offices:243.1.3 Number of departments25REVIEW OF VARIOUS DEPARTMENTS OF HBL:25Managerial Department for Development of Business25Credit Department:26Information Technology Department26Operations Department:27Finance Department32Administration Department32Account opening department:33Cash department:35Bill clearing department:35Foreign department:36Fixed Deposits Department363.1.4 Offices or field offices373.2Current staff383.2.1Current staff of branch according to qualification and experience383.3 Critical analysis of the branch393.3.1 Communication system393.6 Summary404Introduction of Polices and Strategies of HBL:424.1 policies424.2 STRATEGIES:43Summary:465Introduction of Specialization Area:475.1. SWOT ANALYSIS OF HBL47Strengths48Weaknesses49Opportunities50Threats515.2PESTL ANALYSIS AND ENVIRONMENTAL SCAN52POLITICAL ENVIRONMENT53ECONOMIC TRENDS53SOCIO-CULTURAL ENVIRONMENT54TECHNOLOGICAL FACTORS55LEGAL ENVIRONMENT565.3 Ratio Analysis of the HBL:575.4 Summary:616CONCLUSION & RECOMMENDATIONS637References66

CHAPTER no.1

INTRODUCTION TO THE REPORT

Chapter one is about the introduction to the report. Every student of Master in Business Administration at University Of Gujrat has an essential requirement to do Six weeks internship in any of the well reputed organization.This is an essential requirement of our university. Work done in organization is written in as a comprehensive report. Internship report is submitted to our designated teachers. Internship helps us to enhance our abilities in order to understand the real world organizations and their workings. I did my internship in Habib Bank Limited Gujrat.In this chapter brief background of the report is given. The scope, objectives and purpose of collectively in HBL has been given in chapter one. The methodology used to data collect is described in this chapter. The introduction of the specific organization I have chosen for internship is also included in chapter one.0. Background of this study:

Internship during Masters in Business Administration is the requirement of University Of Gujrat. So I have selected Habib Bank Limited for internship. Gujrat branch of Habib Bank was located G.T ROAD BR. GUJRAT. There are many other banks in my town but I prefer to join HBL as I got inspiration from their efficient services provided to their customers. Their customers appreciate their service thats why I want to know the key elements of their success and excited to join HBL. The purpose of this study:

The purpose of this study is to inform the students with practical applications of theoretical concepts taught to them during conduct of their MBA program. The internship in HABIB BANK is personally arranged by my own resources and the department gave me a letter for getting this internship.This study helps us to understand the real working environment in organizations. This study improves our report writing skills and helps us to sharp our learning skills and improve our observation.Scope of the study:

Really, it was a nice opportunity to have a close comparison of theoretical concept in practical field, involving the use of primary and secondary data. All the efforts on the way are summarized in shape of this Internship Report. This Report may describe deficiencies on my part but still it is an output of a students efforts, for which I beg excuse. In this practice data of statistical was also collected and data of analytical was gathered along with its limitations.Objective of the study:

The main objectives to study in HBL were: To gain knowledge about the professional environment of the bank. To enhance my observation. To know how the banking system runs today. To be able to move in professional organizations. To implement the theoretical knowledge at real work place. To learn more from the experiences of senior managers. To know how to deal with the customers. To know the importance of having professional attitude at work place. To change my thinking about the easiness of job. To know that sharp memory and more responsiveness towards work would increase the interest in work. To learn more about banking sector as this sector is in boom now days. To cope out the rapidly changing environment. To know about the effective and efficient service to their customers. To know about the technology utilized in the banks. Methodology of the study:

For the completion of my report both primary and secondary data was utilized. Methodologies used were both:I. Primary Data: Personal observations Discussion with Bank PersonnelII. Secondary Data: Annual reports Journals Newspapers Reports Internet

Organization:

I have selected Habib Bank Limited for internship. Gujrat branch of Habib Bank was the organizations where I have spend 6 weeks as an internee. To complete my internship at Habib Bank Limited was my top priority as it was an honor for me to join HBL. The value of HBL is very good and people have a good image of HBL in their minds. Customers have satisfactory services getting from bank and feel proud of being the customer of HBL. Thats why I have also satisfactory period spend at HBL. They not only care for their customers but workers and internees as well.1.6 Summary:

This is the first chapter of the report containing the detail introduction of the report. This chapter starts from the introduction. Then contains data about the background of the report. In this chapter study purpose is also depicted. Objectives and scope of internship at HBL are discussed in detail in this chapter. Data collected from primary and secondary sources are mentioned in methodology section of the report. Then the description of organization I have chosen for internship is made. Now it is the end of chapter one on the summary. Thus chapter one is all about the complete introduction to internship report.

CHAPTER no.2INTRODUCTION TO HBL

Chapter two is about the introduction to the organization. In this chapter the overall banking system is depicted. This chapter contains information about what is the current banking situation in Pakistan. How many banks are working in Pakistan and how the banks work in Pakistan. Then the role of specific bank (Habib Bank Limited) is depicted in detail. The overall introduction of organization is also included in this chapter. What are the different functions of the organization are also included in this chapter. Like all other banks, HBL also has its own objectives which are also the part of this chapter. Then the specific organization in which I did my internship is also included. At the end of the report the summary of the whole chapter is written.Overall respective sectors in Pakistan:

The Banking sector is an integral part of the countrys financial services industry. The sector witnessed a phenomenal growth in 2001-03 where deposits rose by almost 100%. There are 39 scheduled banks (including 11 foreign banks) operating in Pakistan. Competition is relatively high, especially after the challenging capital adequacy benchmarks set by the State Bank of Pakistan to nourish a stable banking system. Attracting foreign investment and winning profitable customers are the only options left to banks for survival. Opportunities for foreign banks, especially in consumer and retail

banking, are greater than ever before. In the financial year of 2004-05, the banking sector experienced growth rates of 21% and 36% in its deposit and advances portfolio respectively, which in turn, has increased the banks stability as compared to the preceding year .A significant shift of focus from industrial lending to consumer products has allowed the banks to enjoy enormous spreads. However, the manufacturing sector is still enjoying the highest share in credit facilities extended by the banking industry.Banks are financial intermediaries. Financial Sector in Pakistan possesses a wide spectrum of financial institutions. Commercial banks, specialized banks, national savings schemes, insurance companies, development finance institutions, investment banks, stock exchanges, corporate brokerage houses, leasing companies, discount houses, micro-finance institutions and Islamic banks. They offer a whole range of products and services both on the assets and liabilities side. Financial deepening has intensified during the last several years but the commercial banks are by far the predominant players accounting for 90 percent of the total financial assets of the system.Role of the organization in Pakistan:

HBL was the first commercial bank to be established in Pakistan in 1947. Over the years, HBL over 1,455 branches across the country and a customer base exceeding five million relationships. With a presence in 26 countries, subsidiaries in Hong Kong and the UK, affiliates in Nepal, Nigeria, Kenya and Kyrgyzstan and representative offices in Iran and China, HBL is also the largest domestic multinational. The Bank is expanding its has grown its branch network and become the largest private sector presence in principal international markets including the UK, UAE, South and Central Asia, Africa and the Far East. Key areas of operations encompass product offerings and

services in Retail Banking. HBL has the largest Corporate Banking portfolio in Pakistan with an active Investment Banking arm. In the UK and GCC, HBL focuses on trade finance and remittances for the South Asian Diaspora in addition to basic banking facilities. HBL has always been a bank and a brand for the masses, with a history that is inextricably linked with the history of Pakistan itself. As it continues to grow, both locally and abroad, it strives to embody its brand personality: honest, approachable, and inclusive. 2.3 Overall organization and functions of org in Pakistan

HBL has its own identity in the field of banking. HBL has gained name at national and international level. HBL has following distinct Vision, Mission and Values: HBLs Vision, Mission and Values:

OUR BRAND

Our brand identity is the outward expression of what we stand for as an organization. This is summarized in our vision, mission and is supported by our values.VisionEnabling people to advance with confidence and success.MissionTo make our customers prosper, our staff excel and create value for shareholders.

SYMBOL OF HBLSymbol depictsBismillah ============Islamic Culture and ValuesSword ============== PowerLion================ As a symbol of strengthValuesOur values are the fundamental principles that define our culture and are brought to life in our attitude and behaviors. It is these values that make us unique and unmistakable. Our values are defined below:ExcellenceThis is at the core of everything we do. The markets in which we operate are becoming increasingly competitive, giving our customers an abundance of choice. Only through being the very best in terms of the service we offer, our products and premises - can we hope to be successful and grow.IntegrityWe are the leading bank in Pakistan and our success depends upon trust. Our customers - and society in general expect us to possess and steadfastly adhere to high moral principles and professional standards.

Customer FocusWe understand fully the needs of our customers and adapt our products and services to meet these. We always strive to put the satisfaction of our customers first.MeritocracyWe believe in giving opportunities and advantages to our employees on the basis of their ability. We believe in rewarding achievement and in providing first-class career opportunities for all.ProgressivenessWe believe in the advancement of society through the adoption of enlightened working practices, innovative new products and processes and a spirit of enterprise.MANAGEMENT SYSTEM:In HBL there is an open management system.An open management system is one that is influenced by and is continually interacting with its environment.ORGANIZATIONAL LEVELTOP MANAGEMENT President Senior Executive Vice PresidentMIDDLE MANAGEMENT Executive Vice President Senior Vice President Vice PresidentLOWER LEVEL MANAGEMENT Assistant Vice President OfficersROLES PERFORMED BY DIFFERENT LEVEL OF TOP LEVEL MANAGEMENT To make day to day decisions to run the organization to make more profit. To implement policies approved by board of directors. To recommend different products / changes in policies / procedure for approval.MIDDLE LEVEL MANAGEMENT To perform departmental activities. To supervise activities & direct the organizational source toward, achievement of organizational goals. To supervise operational activities of branches. Monitoring / marketing the productsLOWER LEVEL MANAGEMENT To render services to customers. To sell product to the customers.

2.4 STRUCTURE & FUNCTIONS OF HBLThe main Functions of HBL are: Collecting cheques and bills exchange from its customers. Collecting interest due, divided pensions and other sums to customers. Transfer of money from place to place. Acting as an executor, trustee or attorney for the customers. Providing safe custody and facilities to keep jewelry, documents or securities. Issuing of travelers chafes to give credit facilities to travel. Issuing of letter of credit to facilitate imports and exports. Accepting bills of exchange on behalf of customers. Purchasing shares for the customers. Undertaking foreign exchange business. Furnishing trade information and tending advice to customers.OBJECTIVES OF HABIB BANK LTD.The main objectives of HBL are: Personalized banking system. To earn profit for bank itself and maximize the shareholders wealth. To provide solution for multiple requirements of clients of diverse financial nature. Domestic saving. To cope out the rapidly changing environment. To matching with the changing trends of modern day financial market. Fully modern and atomized services to their customers. Acceleration in the commercial activities and capture the large market shares. The credit requirements of different sectors. Offer credit to the agriculture sector at a lower rate. Effective and efficient service among the competitor. The international trade. The banking services to urban and rural area Uplift the bank in banking as superior and best banking. Serve commerce and trade community. To provide financial opportunity to people. Honest and ethical conduct, including ethical handling of actual or apparent conflicts of interest between personal and professional relationship. To help in development and industrialization of the country.SERVICES OFFERED BY HBL:Our brand identity is the outward expression of what we stand for as an organization. This is summarized in our vision, mission and is supported by our values. Commercial Banking Corporate Banking Investment Banking Global Treasury Islamic Banking Cash Management Asset Management Zarai Banking

0. Organization office in which you are working:

HBL has many branches in Pakistan and across the world as well. But I have chosen the HBL Gujrat branch. Many branches of HBL in Gujrat. I completed my internship in HBL branch.This branch is located on the G.T. Road BR. Gujrat. This is located on such a place where people can go easily and not face any difficulty in reaching there to get the banking services. The place where HBL is working is good for transport facility. Every type of transport has an easy access to this location thus increasing the value of this branch.Internee Work:I have spend in HBL branch 6 weeks. 1 week for products information, 2 week for account opening, 1 week for clearing dept., 1 week for cash dept. and 1 week for remittance. My timetable in Ramadan 8 to 1:45 and in normal day 9 to 5. Starting & ending date my internship is 5th july to 19th august 2013.Summary

This chapter is about the introduction to Habib Bank Limited. First of all there is a complete introduction of overall banking sector in Pakistan. The current banking situation is described in this chapter. Banking is an important sector of economy. Banks work as an intermediary and contribute much to the prosperity in overall economy. After describing the banking sector the role of Habib Bank Limited is also mentioned. It is not easy to describe the role of such a large organization in some pages. But I tried to summarize all of the roles in this report. Organizations perform many functions, which are derived from the Vision, Mission and core Values of the Organization. Thats why the Brand name, Vision, Mission of HBL is also included. The details of functions performed by HBL are also the part of the chapter. The objectives of organization are also included. HBL offer many services to its customers. The services offered by organization are included in this chapter. Above all is the detail of overall banking system and over all structure of HBL. At the end the HBL branch in which I have completed my internship is introduced. HBL branch of Gujrat is my designated organization in which I have completed my internship. Thus chapter two is all about the complete introduction of the organization.CHAPTER no.3Introduction of HBL My Branch 1449:

Chapter three is about the introduction to the Habib Bank Limited. In this chapter the overall working of HBL is described. This chapter contains information about the brief history of the organization. When the bank was established and who starts it. HBL branch G.T. Road Gujrat is established 19 august 1975. No of account is 2484 and base is 380,399. Banks have a proper communication system through which the head office communicate to the branch offices. The details of communication system followed by head office are included in chapter three.HBL branch of G.T. Road BR. Gujrat has many departments. In this branch manager, operational manager, assistant manager, cash officer, cashier. Staff of the branch, their qualifications and experiences is also the part of the chapter. Branch also has training programs, and details about them are included in it. Responsibilities of the employees are also written.

HISTORY AND BACKGROUNG:Habib Bank Limited was established by Mr. Ismail Habib (Late) on August 25, 1942 at Bombay, on the desire of Quaid-e-Azam Muhammad Ali Jinnah, father of the nation. It was the first Muslim Bank of the sub-continent. It was established with a paid up capital of Rs. 2.5 million. At an early stage, the number of its branches was only 12. HBL established operations in Pakistan in 1947 and moved its head office to Karachi. At the time of independence, the areas which now constitute Pakistan were producing only agricultural products raw material for indo-Pak subcontinent. Partially no industries were there to process the raw material; therefore the raw material was exported from Pakistan. There were 19 Non-Indian foreign Banks which were engaged in the export of crops from Pakistan with only two Pakistani Banks i.e. HBL and the Australia Bank. The circumstances were completely un-certain. The confidence of the people had been shaken by the un-friendly environment and till the time peace had not been restored, people would naturally have been interested in other Things. The nation was quite young with extreme scarcity of resources and these definitely added to the difficulties of the govt., to run its own Banking system immediately.Our first international branch was established in Colombo, Sri Lanka in 1951 and Habib Bank Plaza was built in 1972 to commemorate the banks 25th Anniversary. With a domestic market share of over 40%, HBL was nationalized in 1974 and it continued to dominate the commercial banking sector with a major market share in inward foreign remittances (55%) and loans to small industries, traders and farmers. International operations were expanded to include the USA, Singapore, Oman, Belgium, Seychelles and Maldives and the Netherlands.

Privatization of Habib bank:On December 29, 2003 Pakistan's Privatization Commission announced that the Government of Pakistan had formally granted the Aga Khan Fund for Economic Development (AKFED) rights to 51% of the shareholding in HBL, against an investment of PKR 22.409 billion (USD 389 million). On February 26, 2004, management control was handed over to AKFED. The Board of Directors was reconstituted to have four AKFED nominees, including the Chairman and the President/CEO and three Government of Pakistan nominees.

3.1.2 Relationship of head office to the branch offices:

HBL has its head office in the Karachi. HBL has a very quick network communication system through which the head office sends its messages to the branches. If head office has an instruction or any kind of information first head office sends the e-mail to all the Branches and later hard copy was also send to the each Branch.Habib Bank has the Anti money laddering department in his head office. This department checks all the abnormal (which not occur on daily basis) transactions and asks the subsequent Branch to give the information of that transactions and check whether this transactions was actually occur or not. Furthermore this department makes the Balance sheet on daily basis and if any mistake occurs in the accounts then it will be corrected in the beginning that way banks saved from any serious damage.Audit team comes from the head office on the annually and semi annually basis to check the accounts. Audit team may also come at any time in the Banks to check that whether the staff maintaining the customer record on daily basis or not. 3.1.3 Number of departments REVIEW OF VARIOUS DEPARTMENTS OF HBL: Various departments are working in all the branches of Habib bank to facilitate the customers.Followings are the main departments of HBL: Managerial Department for Development of Business Credit Department I.T Department Manager Operations Departmenti. Deposit departmentii. Recovery Operation Departmentiii. Finance Departmentiv. Internal Auditv. Administration Departmentvi. Account opening department.vii. Cash departmentviii. Lockers department.ix. Bill clearing department.x. Foreign exchange department.xi. Information Technology Departmentxii. Fixed Deposits DepartmentManagerial Department for Development of BusinessThis is the important department of HBL. This department is established to facilitate the customers of the bank. Branch Manager is responsible for the smooth working of this department. He alone makes his customers loyal with the bank. He not only cares for the existing customers but also try to generate new references to the bank. Branch Manager tries not only to sustain the relationship of customers to the bank but also tries hard to strong the relationship of customers to the bank. Branch Manager looking for presents customers and also tries to take care of future or expected customers of the bank. Thus, as this department is directly related to make the customer bank relationship stronger so it is the most important department of the bank and branch manger directly deals with customers to make them loyal with the bank.Credit Department:The function of credit department is to lend money in the form of clean advances, against promissory notes, as well as secured advances against tangible and marketable securities. The bankers prefer such securities that do not run the risk of general depreciation due to market fluctuations.Loans are offered to the staff of the following four categories. House Building Loans against mortgage of property. Loan for purchasing vehicles.The Credit Department is responsible for advancing loans to the customers. The loans are mainly categorized in two types as given below:i. Lending Products: To advance loans to labour intensive enterprisesii. Banking Products: Advances to general account holders.Loans are provided to support the business community. Loan is given not only to the business sector but other customers are also facilitating by loans granted by this department.Information Technology Department All the information can be shared mutually by the virtue of software called MYSIS. This information system connects all branches in Pakistan with each other through intranet. The banking and treasury transactions are also made through this system and could be accessed anywhere in all over the Pakistan.Software used by HBLHBL is enjoying the competitive advantage of vast operational area. There are two types of branches come under HBL network. One type is the online branches whereas other type is batch branches (offline branches). So obviously HBL uses two types of different software. All batch branches use SIMEX software whereas online branches use MYSIS.MISYSMISYS (online) perform two type of system Cashier systemThis system use only cash transaction like cash withdraw, deposited, Remittance, Accounts opening, LFT etc. Equation systemClearing inward or out ward, special or intercity clearing, supervision

Operations Department:The other important department is the operations department. Remittance officer is also in this department so increases the value of this department. Thus there are many operations which fall under this department. Due to increasing the number of operations under this department, the department is getting most importance. The operational departments fall under this head is as follows:Deposit department:

Deposit department is also an important department. Banks basic purpose is to get the deposit. The facilities provided to the customers to attract more and more deposits are of different types. These are as follows:Current Accounts

Make unlimited transactions while maintaining a low minimum balance every month. HBL is currently offering three types of accounts in current account category. Their detail and name is as under.i. HBL Business Value Accountii. Current Accountiii. Basic Banking Account (BBA)

HBL Business Value Account Unique transactional account for Businessmen Up to 5.35%* profit per annum Profit calculated daily, paid every quarter No minimum balance requirement HBL Debit Card and Inter Branch Transaction System (IBTS) facilities Up to 10 Bankers Cheques free (at minimum balance of Rs. 500,000) Funds transfer to any bank through HBL Phone Banking Current Account

Minimum balance of Rs. 5,000 Unlimited transactions Non-profit bearing HBL Debit Card and Inter Branch Transaction System (IBTS) facilities Funds transfer to any bank through HBL Phone Banking

Basic Banking Account (BBA) Can be opened with only Rs. 1,000 No minimum balance requirement Up to 2 withdrawal and 2 deposit transactions free every month Unlimited withdrawals through HBL Debit Card Non-profit bearing

Savings accounts

Avail the flexibility of making transactions while earning profit on daily/monthly basis. HBL is currently offering five types of accounts in savings account category. Their detail and name is as under.i) HBL Value Accountii) PLS-Savings Accountiii) Remittance Munafa Plus Savings Accountiv) Daily Munafa Accountv) Daily Progressive AccountHBL Value Account 7.19%* profit per annum Profit calculated monthly, paid every quarter Deposit ranges from Rs. 10,000 to Rs. 1,000,000 Two withdrawals free every monthPLS-Savings Account 5.06% profit per annum* Profit paid bi-annually HBL Debit Card and Inter Branch Transaction System (IBTS) facilities Funds transfer to any bank through HBL Phone Banking Minimum balance of Rs. 20,000 Unlimited transactionsRemittance Munafa Plus Savings Account Special account for receiving foreign remittances 5.12%* profit per annum Profit paid every month Minimum balance of Rs. 20,0003.1.1.5 Daily Munafa Account Profit calculated daily, paid every month Up to 8.84% profit per annum* HBL Debit Card and Inter Branch Transaction System (IBTS) facilities Funds transfer to any bank through HBL Phone Banking Minimum balance of Rs. 20,000

0. Daily Progressive Account

Unique transactional account for Institutions Profit calculated daily, paid every month 0. Up to 11.57% profit per annum*

Inter Branch Transaction System (IBTS) facility Funds transfer to any bank through HBL Phone Banking Minimum balance of Rs. 20,000Terms Accounts

Invest your savings in HBL term deposits for a fixed duration and earn profit while keeping your savings secure. HBL is currently offering one type of account in terms account category. Their detail and name is as under.

TermProfit per annum*

1 Year

10.25%

3 Year

11.00%

5 Year

10.87%

10 Year

10.24%

1. HBL Advantage AccountHBL Advantage Account Multiple options for tenure and profit payout Loan facility up to 90% of investment Minimum investment of Rs. 25,000 Withdrawal at end of fixed term

0. Foreign Currency Accounts

HBL offers Foreign Currency Accounts in multiple currencies as savings and term accounts. Their detail is as under.FC-SB Savings Account offered in 3 currencies, USD (US dollar), EUR (Euros) and GBP (UK pound) Tiered product, with rates depending on choice of currency To earn profit, minimum balance in USD, EUR and GBP is 1,000 Interest is payable on a quarterly basisHYFFD (High Yield Foreign Currency Fixed Deposit)

Available in 1 month, 2 month, 3 month, 6 month and 12 Month in USD, EUR and GBP Tiered product, with rates depending on choice of currency and term Profit paid on maturity only. No interim interest is payable.NOTE:All the rate and terms and condition are revised by HBL after every six months periods. Recovery Operations DepartmentThe main function of this department is to recover the debts of the bank. In the previous political government huge amount of loans were granted on political grounds which are mostly bad debts. This department is trying to recover those old and new debts.Finance DepartmentThe Finance Department is further divided into two departments:i. Treasury: It is Karachi based and deals in money marketii. Accounts: It deals in accounting functions and preparations of different statements.Internal Audit This Div. works under the Board of Directors. It has a President who is CIA qualified. Its function is to observe the internal control. The audit is conducted quarterly. The audit teams inspect every branch of the bank. Surprise visits are also conducted by the auditors.Administration Department All the matters of administrative nature are being dealt in this department. This includes: transfers, posting, promotion orders, leave orders, approvals etc.Account opening department:Basic function of the accounts department is to open new account and facilitate the customer for the account opening purpose. There are certain formalities which are to be observed for opening of an account with a Bank. These formalities in brief are as under:Documents require for opening an account: Copy of CNIC Service certificate or student card. Utility bill Provisional receipt KYC (Know Your Customer) Pictures of account holderAllotment of Account NumberAfter going through the procedure above mentioned an account number is given to the customer. One thing is very important for understanding that even going through the above mentioned procedure successfully, it does guarantee the opening of account. After allotment of account number it remains block for two days as the verification process is in process in these two days. This is why account is inactive for its first two days.Specialty of Account NumberFourteen digits account number is allotted to the HBL account holder. The first four digits are code of HBL branch where account is going to be opened, afterward eight digits are customer account serial number and last two digits indicates type of account. For example 0396 75001089 01 Branch Code Account Serial # Type of account

Posting the account on the system:After that officer has to post the new account on computer system for further processing. During the process customer id and account number is generated. New account remains active for one day after that it is blocked by the head office until CNIC of the customer is verified from NADRA.Cheque book issuing: After the CNIC verification account opening officer has to issue a cheque book to customer so that he can be able to make withdrawal from his account. Now a day in Habib bank cheque book issuing process is centralized that take 06 days to complete.

Types of accounts:Individual accounts: Individual accounts are the most common personal investment accounts. Opened by single person.Joint accounts:A joint account occurs when two or more than two customers have one account. The parties to a joint account are considered in law as they are one person.Business accounts:Business accounts can be opened by institutions, companies, partnerships, trusts and non-profit organizations. Following documents are required.

GROUNDS FOR CLOSING THE CUSTOMERS ACCOUNT: The banker may close the account of the customer due to following reasons: Notice by a Customer Death of a Customer Customers Insanity By order of courtCash department:Cash Department is very sensitive and risky part of the bank. Very causations and competent personnel are needed for the Job. HBL has really such a diligent staff with appreciable competencies and will to do work. Main function of cash department is to deal with cash payment and cash receipts. Bill clearing department: Every bank acts in two way i.e. Paying Bank Collecting Bank Here in theory no legal obligation on a banker to collect cheques, drawn up to other banks for a customer. It is, however, an important function of crossed cheques. A large part of this work is carried out through the N.I.F.T.NIFT- National Institutional Facilitation Technologies (Pvt.) Limited: NIFT is a joint venture between a consortium of six major banks and private sector. It is responsible for the establishment and management of automated clearinghouse facilities in Pakistan. NIFT is proactively involved in the modernization of payment systems in Pakistan.

FUNCTION OF CLEARING DEPARTMENT: The following are the main functions of clearing department. To accept transfer deliveries and clearing cheques from the customer of the branch and to arrange for their collection. To arrange the payment of cheque drawn on the branch and given for collection to any other branch of Habib Bank of Pakistan or any other members, or sub-members of the local clearing area.. To collect amounts of cheques drawn on members, sub-members of the local clearing house, sent for collection by those Habib Bank Limited, branches which are not represented a the local clearing area. Foreign department: International trade is growing and with the development of international trade it has become more imperative. For countries to devote more and more attention to the complicated mechanism of Foreign Exchange. It is more important in case of developing countries. It is need of time, that a country should conserve its foreign exchange resources. Issuing foreign exchange accounts cheques books: Another function of foreign exchange department in Wah cantt branch is to issue foreign exchange accounts cheques books to customers on request. This process is not yet centralized. Cheque book is issued within 15 minute of receiving request from customers after making necessary register entries and posting stamps on it.Fixed Deposits DepartmentFixed deposits are those which can be withdrawn only after the maturity period. In this type of deposits the Bank allows high rates of interest depending on the time period of deposits. The shorter the period of deposits, the less will be the interest and vice versa3.1.4 Offices or field officesOffices mean the Head office which is situated in Habib Bank Plaza, Karachi, Pakistan. HBL is the largest bank in Pakistan. Field offices mean the Branches. HBL has the largest domestic branch network in Pakistan. The bank has a network of over 1450 branches in Pakistan and 55 branches worldwide in 26 countries. It has a domestic market share of over 40%. It continues to dominate the commercial banking sector with a major market share in inward foreign remittances (55%) and loans to small industries, traders and farmers.HBL works in domestic as well as international arena. Domestic branches 1450 International branches 55 Subsidiary branches 8 Affiliate branches 119 Representative offices 2Offices in 26 countries across 5 continents.HBL 1450 branches are spread from one end of the country to its last frontiers in the north, east, west and south thus contributing to the overall well being of the communities they serve. Their presence in the country diverse urban regions as well as in the rural areas, including far flung locations of the country. Often classified as in accessible areas, creates opportunities for HBL to provide financial services that compliment business of varying sizes and complenites.

0. Current staff

The current staff of HBL branch G.T. Road Gujrat has experience and cooperatively. The branch manager is Asif Imran, operational manager is Sara Bano, assistant manager is Mirza Tanveer Baig, cash officer Ayesha and cashier is M. Asif. All staff are very good and cooperative.

2. Current staff of branch according to qualification and experience

HBL branch G.T. Road Gujrat has the 8 staff members. Which are as follows:NameDesignationQualificationExperience

Mr. Asif ImranBranch ManagerB.com30 Years

Mrs. Sara BanoOperational Manager

MBA Finance 3 Years

Mr. Mirza Tanveer Baig Assistant Manager

Graduate 32 years

Mrs. AyeshaCash OfficerMBA Finance ( continue)3 Years

Mr. M. AsifCashier

Matric30 Years

3.3 Critical analysis of the branchI have worked in HBL branch G.T. Road Gujrat. The working environment of this branch is very well and good. Manager has good cooperative and good relations with his workers. All the employees or workers are highly motivated. Salaries of employees or workers are very satisfactory and they are willing to utilize their energies to the high performance of their branch. Workers gain respect from their manager, coworkers, customers and public as well.It is also necessary to hire experts to increase the morale of the workers. There should be some sort of healthy activities through which workers can feel easy and get relaxation.

3.3.1 Communication systemCommunication:Communication is the process of sharing information with other individuals. Information, as used here, is any thought or idea that managers desire to share with other individuals. This technique is important for any manager to be successful.HBL used both the upward and downward communication.

Interpersonal Communication: -The communication activities of Managers generally involve interpersonal communication sharing information with other members. In HBL, the information is usually share by writing and sending memos and letters.

Types of Interpersonal communication: -There are two types of interpersonal communication Verbal communication Non verbal communicationVerbal Communication:Verbal communication is the sharing of information through words either written has spoken.Nonverbal Communication:Nonverbal communication is the sharing of information without using words. Like gestures vocal tones and facial expressions. Interpersonal communication in HBL Organizational communication is directly relates to the goal functions, and structure of human organizations. Organizational success is determined by the effectiveness of organizational communication.3.6 SummaryThis is the end of chapter three. In this chapter the complete introduction of the HBL branch G.T. Road Gujrat has given. Chapter three is all about how the branch is working. In this chapter it is described that how the head office communicates to the branches. What are the communication channels in branch itself. Details of different departments working in branch are also given. Details of offices and field offices are also given. Other head contains data regarding the current staff of HBL. Details of qualifications and experience of employees is also given. Training of employees, their workload, salary structure, promotion system, incentive and motivation of employees is also discussed in detail. Responsibility of employees is also its part. Communication is also the part of the system. Morale of employees is necessary to increase. Physical facilities have their necessary to describe. Then performance and output is measured not only in terms of customer satisfaction but also in terms of account holders, their deposit and budget as well. Budget is the important part of the branch so discussed here. At the end precise summary of the chapter is given.

Chapter no. 4 Introduction of Polices and Strategies of HBL:This is the important chapter of this report. This chapter contains the policies of HBL. Polices of any organization play an important role in the development of that organization. As polices show the direction of work down in the organization so polices are the important part of the success or failure of that organization. As I have worked in the HBL so here I discuss the different polices of HBL. As polices are the ways through which the organization get success so the organizations do not usually tell polices of the organization to outsiders. Due to the most important part of organization polices should be made stabled and should be persistent. This chapter is about polices of HBL. As described earlier that polices should be appropriate and should be understandable to all employees so these play an important role in the organization. Not only polices but the strategies are also important to the bank. As strategies are also important so these should be also clearly defined to those who are working to implement the strategies to in order to apply polices.4.1 policiesAs described in the introduction of this chapter that polices is the important part of any organization. Polices kept to be secret and the information regarding the polices are not fully disclosed to any outsider. However in this head, I tried to show the procedure adopted to make the policy, means how polices are made and what polices are made in HBL.PURPOSE OF HBL WHEN DEVELOP PLANSIn HBL both the purposes of planning has been used: PROTECTIVE purpose of planning is to minimize risk by reducing the uncertainties surrounding business condition. AFFIRMATIVE purpose is to increase the degree of organizational success.According to demographically / political / economic and social sector. Plans by seeing the external factors EXTERNAL FACTORS include political, social, demographic, consumer, economic, state bank policies and rules effect the bank e.g; increase in cash equidty badly effect bank.PLANNING TOOLS USED BY HBL Planning tools are techniques mangers can use to help develop plans.HBL is using a FORECASTING, TIME SERIES ANALYSIS METHOD tools when develop plans:FORECASTING is a planning tool used to predict future environment happenings that will influence the operation of the organization. It includes political economical condition, consumer income forecasts than we plan.TIME SERIES ANALYSIS METHOD is to predict future sales levels by analyzing the historical relationship in an organization between sales and time.4.2 STRATEGIES:Strategy refers to a plan of action designed to achieve a particular goal. Strategies are the ways through which polices and goals of the organization is met. So it should also be an important consideration to make the strategies achievable. Followings are the different strategies which are important. Another important point is this as there is not fully disclosed information regarding HBL strategies so the described strategies may not be as much realistic as that might be in reality.

IMPLEMENTATION OF STRATEGY IN HBLStrategy implemented in HBL in the following manner.STEP1: Review organizational objectives HBLs objective is to make other customer prosper and to create value for their stakeholders.STEP2: Set worker objectives To earn profit for the organization STEP3: Monitor progress Less complaints Timely service is provided Monthly revenue and costSTEP4: Evaluate performance Performance efficiency achieving his goals / targets. His performance is appraised with regard to the targets allocate to staff.STEP5: Give rewards Promotion Special salary increase Cash price

SCOPE OF DECISIONHBL makes both narrow-scope and broad-scope research and development decisions. They can take feedback, circulation of questionnaire for important decision from top to lower level. Scope of decision depends on the level of management. Higher the level, higher will be the scope.STEPS TAKING BY ORGANIZATION WHEN MAKING DECISIONSTEP1: Identify an existing problem Complaints customer service cash counter They delay the cash Notes are not clean Not behave wellSTEP2: List possible alternatives for solving the problem Change the cash counter staff or being replaced with new hire staff who are better in education, manner, and dress Warning to customer staff Transfer the counter staff to other branch / from present assignment to non-counter assignment.STEP3: Select the most beneficial of these alternativesOption 1 is bestSTEP4: Implement the selected alternatives The counter staff is being replaced with fresh hires.STEP5: Gather feedback Less complaintsAs the polices made are properly implemented in HBL so the bank enjoys the benefit of implementing and making the polices. All the employees put full effort to achieve the polices at the right time. The overall efforts of the employees are contributed to achieve the goals of HBL. So the proper efforts of the employees are contributed very much. Thus goals of HBL are easily achieved. Summary: This is the end of chapter four. In this chapter the overall polices of the HBL has given. As throughout in this chapter the importance of polices has described so this chapter is containing important information about the different polices of HBL.Not only polices are important but the efforts to implement that polices are also important. Polices should be successful if the ways to achieve that polices should be effective. Polices should be successful only if the appropriate methods are adopted to achieve that polices. As it is described earlier that polices are the competitive edge of any organization in order to get success so the bank also keep its polices very secret. Due to the limitations imposed by the secrecy of the polices I am not better able to describe the entire banks in detail.This chapter is important regarding to data described in this chapter. The success of the polices is also described in this chapter. How much the polices are successfully implemented is also the part of this chapter. So this chapter is all about containing the important information.

Chapter no. 5Introduction of Specialization Area:This is chapter five. In this chapter HBL is taken in the broader field. In the previous chapters yet the entire workings are described. But in this chapter I try to cover the broader areas. Not only internal conditions are important for the bank to survive but also the external environment also plays important role to survive. Due to the very importance of external environment, external factors are also discussed in this chapter.First of all the SWOT ANALYSIS of HBL is made. The strengths of HBL are also the part of this chapter as well as the weaknesses of HBL is also described. All the opportunities and threats in external environment are also discussed in detail. As there is not only a single business exists in the world which has only the strength and opportunities so the weaknesses and threats of HBL are also discussed. Then the PESTL analysis of HBL is also made. Political, Economic, Social and Technological factors affecting the HBL are also discussed. Ratios are also important to show the financial position of the bank. That is why the ratios are also discussed in this chapter. At the end the summary of the chapter is given.5.1. SWOT ANALYSIS OF HBLSWOT stands for Strength, Weakness, Opportunities and Threats. Strength and weakness are the internal factors and opportunities and threats are the external factors. HBL is considered to be a very sound bank in the financial circles. This is the bank where customers can safely keep their money as long as they want.

In SWOT analysis the best strategies accomplish in organizations mission by: Exploiting opportunities and strengths. Neutralizing its threats and Avoiding its weaknesses.Following is a list of SWOT of HBL

Strengths The officers of HBL are considered as one of the most able professionals in the banking world. I observed that HBL employees (except annoyed ones) interact with their clients as if they are their personal friends and discuss about their problems as their own. HBL has got a reliable and easy to use internal computer system. HBL maintained its data properly. HBL has very good security system. HBL is the larger commercial bank in Pakistan with the network of over 1450 domestic and international branches. HABIB BANK is a well established bank enjoying long history of over 65 years of experience and profitable operation. HBL is the largest private bank in Pakistan now and people trust is very high. HBLs car to car financing scheme is unique in auto loan segment. Habib bank is an internationally recognized name in banking services and products. HBL has forged strategic alliances with international banks for expanding its network further, both locally and internationally. It has the largest branch network among private banks of Pakistan Being the pioneer of banking in Pakistan, HBL is the oldest and is the richest in experience. A skill or capability that enables HBL to conceive and implement its strategies. HBL has opened all its branches at commercial areas so that the customers or clients face no problems in reaching to the bank. The band is always on the look to improve its services both to the domestic as well as overseas customers. Human resources development and introduction of new technology towards modern banking. 24 hours cash access and safe payment products for high value transaction. Having potential to encounter the competitive environment in the market. Customer enjoys the services at the residential localities. HBL enjoys deep relations with all most all industries in Pakistan

Weaknesses There is week communication system in overall HBL as well as inside branches. Highest number of branches effecting the proper maintenance and difficulty in providing same working environment at the each branch. Poorer system of recovery of the system is a threat to bankruptcy. Lack of customer feedback. Low job satisfaction. Poor ATMs Service. In consistency in efficiency and working atmosphere due to the largest of branches. Sense of insecurity in the employees serving at low profitable branches due to the downsizing. Females feel uneasy in an environment among the male workers. Victim of political, legal and socio-cultural pressures. Lack of professionalism in the branch employees mostly. Lack of communication between bank and customers about terms and condition of products and services. Like centralization of cheque book issuing process. Employees at branch level are not properly motivated to work by heart. They take the all routine activities as a boring job. Now as it is a privatize bank that is why GOVERNAMENT support to HBL decreased as it was in past Mission of HBL is not well defined. Opportunities Huge untapped market potential in consumer banking as well as Islamic Banking Opportunity for developing value added services combined with corporate banking relationships, cash management services to large and medium sized corporate clients. Growing policies of government on business and commerce sector provide HBL opportunities to take advantages of these policies to meet efficiently with the business people to solve their problems with the instant cash and financing facilities. Government is supporting very bold steps of bringing and promoting IT in Pakistan. HBL has an opportunity to improve in technology. Large international network which principally focuses on trade finance with Pakistan can be utilized to tap trade activities in other markets. In addition, services such as cross border / offshore financing for corporate customers can be enhanced. Customer feedback on different products and accounts has really improved the bank performance and encourage the atmosphere for other future policies. HBL also has an opportunity to expand its new technological advancement more effectively like; phone-banking and internet banking facilities in order to serve the customer more efficiently, specially E-banking facility is also a new opportunity which is a flourishing business in foreign countries and can also be here, if HBL takes the initiatives. Further reduction in intermediation costs possible, with improving technology. Due to efficient and veteran management group, HBL can also improve and expand its foreign operation successfully. Habib Bank Limited provides opportunity to utilize its skills and efficiencies in leasing business.

Threats Prevailing circumstances increases the difficulties the organizations achieving high performance. Consolidation in the banking sector resulting in increased competition. Shortage of trained and specialized staff at lower executive and officer levels the threat of inconsistency and government policy regarding to business and economics sectors, specially political and regional situation which makes the environment uncertain. Growing global technological advancement. Strict regulation by government over credit facilities to the customers as well as to meet the prudential. Loss of confidence of overseas customers due to freezing of accounts. Facing more competition by foreign banks in the market. Foreign banks are flourishing in field of consumer financing. Also the increasing operation of private banks. Highly attractive and advance services by foreign banks to their customers. For the last of 2 to 3 years, Pakistan is facing economic and political instability which is a big threat. Foreign banks are flourishing in field of consumer financing. Afghan war and Iraq war has a deep effect on the economy of Pakistan, which has affected HBL. Increased regulations from State Bank of Pakistan may affect its business.

0. PESTL ANALYSIS AND ENVIRONMENTAL SCANA broad view of market is important when management is interested in introducing better services for customers. Rapid technological change, global competition and the diversity of buyers preferences in many markets require the constant attention of the market vouchers to identify promises business opportunities, see the shifting requirements of the buyers, evaluate changes in competitors positioning and guide the choice of which buyers to target and classify them according to respective segments.ENVIRONMENTAL ANALYSIS:Environmental Analysis is the study of the organizational environment to pinpoint environmental factors that can significantly influence organizational operation. HBL has environmental analysis and acts accordingly by pinpointing factors and to counter the same timely.

PESTL ANALYSISIdentification of external and macro factors that influence buyers and thus change the size and composition of market overtime involves initially building customer profiles. These influences include:

Political environment Economic trends Social environment Technological factors Legal environmentPOLITICAL ENVIRONMENTPolitical component is that part of general environment which is related to Government affairs. Government policies may influence the organization and it has vital impact thereon. In 1974, banks including HBL and other important big industries/factories in the country were nationalized as a Government policy. The charter of political parties on coming into powers may influence about a particular industry /organization. The form of Government whether it is a military or democratic. Other countries economic, political and military aids depend upon the form of the government which also influence its industry, social sector institution and financial institutions as well and rating of banks may be downgrade or otherwise. In international markets, foreign banks may refuse acceptance of Pakistani Banks letters of credit (LCs) opened for import of goods. Banks are strongly affected by the political and legal considerations. This environment is composed of regulatory agencies and government law that influence and limit various organizations and individuals. Mostly these laws create new opportunities for business.

ECONOMIC TRENDSIt indicates how resources are being distributed and used within the environment. How the particular community is producing, distributing and using various goods and services.Keeping in view economic resources possessing by the population, HBL targets the customers by introducing various products to attract them. HBL introduced Auto Loan/Flexi, Loan/Life Style/Visa card/debit card/value account to sell them same. The consumers are using the banks products. While selling goods, the wages of the employees, inflation, the tax paid, and the cost of material is kept in mind to determine and what price product/service should be sold in the target market. It is very important for an organizations success to have thorough economic analysis of the environment to design the products and services otherwise an organization may not be able in achieving its results/goals.

A banking market requires better consumer market in volume along with higher borrowing power. The available borrowing power depends on: Consumer income Saving rates Consumption patrons Rates of interest Budget deficit Exchange rates Cost of living Inflation SOCIO-CULTURAL ENVIRONMENTA society is shaped by beliefs, norms and values. People in a society consciously and unconsciously interact with: Themselves Others Organization Society Nature Following are the main factors. Which arise because of change in socio-cultural environment? Consciousness about services Concern for environment Improved customer relation The social component shows the characteristics of the society in which organization exists. There are two important features of the society are Demographics and Social Values.Demographics are the statistical characteristics of a population. It shows the changes in numbers of population and income distribution among the various population segments. Such changes influence the reception of the good and services with the organizations environment. The study of demographics characteristics of population may help the organization in formulating its strategy to compete in the market. HBL as its strategy, targets the consumers (low /middle /high income) by introducing the products. For example, it targets the middle income consumer by introducing consumer products like Flexi loan/Visa Card and Balance Transfer Facility (BTF) and house loan/car loan products were introduced for high income consumers. Social Values are the relative degrees of worth society places on the manner in whi8ch it exists and functions. Social values of the society influence the organization in tailoring its products and services to the consumers. Keeping in view social values in Pakistan society, HBL has strategic planning in introducing the products /procedures. TECHNOLOGICAL FACTORSNew approaches/procedures/technology is used in producing goods and services to compete with the other organizations in the market.HBL has purchased software called as MISYS from a Singapore firm. In 2005, it installed the system in one branch in Karachi and in its Singapore Branch. After its successful launching, it has now installed MISYS in about 300 branches in domestic and overseas branches. Real time banking is now ensured in HBL. By completion of installation process, remaining branches will also be on line banking leading to paperless banking. The customer may transfer their funds from one account to another account within or outside country within few seconds of time. HBL has planned to shift all the 1443 (Nov.2007) branches on MISYS by end of 2008. HBL is the first bank in Pakistan, which has acquired this system to cater its needs. It will also help in reducing staff strength significantly due to elimination of manual work. Due to introduction of MISYS, HBL had to change its existing accounting and procedure system to acquaint with the new system.Forces of technological advancement have played the most dramatic role in shaping the lives of people. The rate of change of technology has greatly affected the rate of growth of economy. New technology is creating deep rooted affects which could be observed in long run. The improvement techniques involved in on line banking. In brief PEST analysis affects the overall banking companies and provides us the information about the external macro condition.

LEGAL ENVIRONMENTThe legal component is that part of general environment which contains passed legislation. It influences the organization. Violation of laws may lead to imposition of penalty to the organization. The banks in Pakistan have to perform their functions in line with SBP directives (regulators), Security & Exchange Commission of Pakistan (SECP), Banking Recovery Ordinance ( 2001) for recovery of loans, BASEL -I & BASELII with regard to Anti Money Laundering (AML) & Terrorist Financing to meet international community obligation and to observe the United Nations directives on freezing of assets of a country or person. Country laws with regard to maintenance of secrecy of information about the customers. In 1974, Nationalization Act was passed and banks and numbers of industries were nationalized and now the same are being privatized. All the nationalized banks except NBP have been privatized through Privatization Commission o f Pakistan. Health and Safety Act aims at ensuring health and safe workplace for the workers.Business legislation has following main purposes To protect banking companies from unfair competition. To protect consumers from unfair business practices adopted by banking companies To protect the interest of the society from unbridled business behavior.Banks are strongly affected by the political and legal considerations. This environment is composed of regulatory agencies and government law that influence and limit various organizations and individuals. Mostly these laws create new opportunities for business. 5.3 Ratio Analysis of the HBL:An index that relates two accounting numbers and is obtained by dividing one number by otherRatio Analysis is an important and age-old technique of financial analysis. It simplifies the comprehension of financial statements. Ratios tell the whole story of changes in the financial condition of business. It provides data for inter firm comparison. Ratios highlight the factors associated with successful and unsuccessful firm. They also reveal strong firms and weak firms, over- valued and undervalued firms. It helps in Planning and forecasting. Ratios can assist management, in its basic functions of forecasting, planning, co-ordination, control and communication.Ratio analysis also makes possible comparison of the performance of different divisions of the firm. The ratios are helpful in decision about their efficiency of otherwise in the past and likely performance in future. Ratios also help in Investment decisions in the investors and lending decisions in the case of bankers etc.Following are the main types of ratios that I am going to calculate in this report to compare and highlight the financial performance of Habib bank in 2008 with 2007. Return on Equity Return on Assets ratio Net Profit Ratio Loan to DepositReturn on Equity Ratio:Return on Equity Ratio20082007

Net Profit after tax X 100Owner Equity

Net Profit after tax15,614,02010,084,037

Owner Equity75,180,43663,237,429

Return on equity20.7615.94

Interpretation:HBL keeps on improving the financial position of the bank. HBL is in leading position to introduce new services to the customers. The above ratios shows that the bank is in good position in 2007 and not only maintain its position but also improve the financial position in 2008 which is a very good sign.The past two years data shows an improvement in the return on equity which is a positive sign. The Bank should have to continue its policies. By observing the audited account I found that this improvement is due to increase in the Net profit which is good sign.Return on Assets Ratio:Return on Assets20082007

Net Profit after tax X 100Total Assets

Net Profit after tax15,614,02010,084,037

Total Assets757,928,389691,991,521

Return on Assets2.061.45

Interpretation:The above ratio is the return on asset ratio. Return on asset is an important ratio. In 2007 this ratio is very good but HBL keeps on improving this ratio in next year as well. There is a huge difference of ratios from the year 2007 to 2008 which shows the commitment of employees towards their work and the loyalty of customers to the bank.Return on assets ratio shows an improving trend. This ratio shows that the both the Net profit and Total Assets has improved in 2008 than 2007. But net profit has increased more rapidly.

Loan to Assets ratio:

Loan to Assets ratio

20082007

Loans Assets

Advances456,355,507382,172,734

Assets757,928,389691,991,521

Loan to Assets ratio60.2155.22

Interpretation:Deposits are also the important asset of the bank. Banks try hard to increase the deposits of the customers. This fact is shown by the above ratios as is increased by 2008 FROM 2007. Loan to Asset Ratio is showing increasing trend in 2008. This is because advances are increasing more rapidly than assets of the bank.

Net Profit Ratio:Net Profit Ratio20082007

Net profit /Interest Income X 100

Net profit15,614,02010,084,037

Interest Income43,970,88433,250,937

Net profit ratio35.5030.32

Interpretation:Above is the net profit ratio. This ratio shows that profit of the bank is increasing or not. As the ratio is increasing from 2007 to 2008 so it showing a good sign. Net profit Ratio is giving upward trend. This trend is observed due to increase in Net profit but on the other hand the expenses decreases which shows an efficient management.

Loan to Deposit Ratio:Loan to Deposit2008 2007

Loans/Deposits*100

Advances456,355,507 382,172,734

Deposits597,090,545 531,298,127

Loan to deposit ratio76.43 71.93

Interpretation:It is also an important ratio. This ratio shows how much the customers are showing the trust on the bank and deposit their balance in HBL. Loans to deposit ratio shows an increasing trend in 2008 as compare to 2007. This trend is observed as the advances and deposits both are increasing but advances are increasing more rapidly than deposits.

5.4 Summary: This is the end of chapter five. In this chapter the important internal and external factors are discussed which can affect the working of HBL. The other factors that can affect the working of bank are necessary to know. SWOT analysis is also important as it shows the strength and weaknesses of the bank and internal and external factors such as opportunities and threats. SWOT analysis shows the important information as it shows how much and what areas are currently covered by the bank and what are the potential areas where the bank can do more.As this chapter contains all such important information so it should add more to realize where the work is being done and where the work should be improved.Not only the SWOT analysis is considered the important analysis but other analyses are also important as the PEST analysis. In this chapter I fully try to cover all those points clearly which comes under this head. People are also interested to invest their incomes in such institutions which have strong financial positions and are necessarily important to consider when making investment. So ratios are also discussed in this chapter and important interpretation of ratios is also made. At the end summary of the chapter is given.

Chapter no. 6CONCLUSION & RECOMMENDATIONS

1. E _StatementThe account statement of customer must mail him after 15 days.2. Transaction through mobile serviceCustomers must provide the facility to make transaction through mobile. By doing this customers can save time and also transportation expense.3. Update customers after every transactionAfter every transaction customers must inform that their transaction has been taken place.4. Marketing developmentNew technologies must adopt to facilitate the customers.5. Cyber warfareCyber warfare must adopt to prevent electronic attacks to save important documents and bank privacy. 6. High Risk in Internet BankingAs there is no proper cell is established throughout the country. It is difficult to handle incase of cyber crime. The customers feel less protection in this regard.Other recommendations are as follows: There should be authority in every region which ensures efficient flow of communication and its understanding. HBL should immediately take brave steps towards the welfare of experienced Habibians. In this regard NBP has set best example. The management should try to decrease job insecurity among the employees. Training program should be started for internees and newly appointed Employees. The bank charges high service charges as compared to the other banks, so these should be lowered down. Surveys must be conducted regarding customer satisfaction level and all employees of this dept. should look forward to getting feedback whenever possible. Adding of value added features that offer competitive advantage is also a means of avoiding customer dissatisfaction.PROBLEMS I SOUGHTDuring my internship in HBL, I found many problems, which should be resolved for the better function of HBL. The problems I have observed are as follows:These problems are:There is lack of bringing change in HBL as the changes are taken place in overall world of banking.Criticism on HBL1. Wastage of TimeEmployees waste their time by using old version softwares and thus not fully skilled.

2. Low SpeedWorking and service providing speed is very low.3. Marketing speedService is not door to door, you have to met people personally.4. Low awarenessPeople and customers do not have awareness about new banking system because they do not provide proper information about bank and online servicesCONCLUSIONTo sum up, internship is like The First Flight for a young business graduate who is to enter his professional life very soon. It provides a gateway to youngsters and an insight of corporate world. It helps them in the orientation phase of their first job as well and if we talk about internship decision in banking sector.HBL is clearly the first choice of everyone who believes in qualitative approach of banking an environment of highly responsible people. Bank is enjoying a healthy market share and taste of good status in terms of its operative features and customer support. HBL is clearly the best bank operating in Pakistan. Corporate and commercial functions are distinguished features of HBL experiencing a good reputation and reasonable mark up with respect to prevailing market mark up with assurance of satisfaction and support. HBL has more customers as compare to other banks, if they given proper attention to every customer then in few years it will be the leading bank of the country.

Chapter no. 7Referenceswww.google.comwww.hbl.comHBL Annual Report 2007Direct Interaction and Learning from: Branch Manager (Asif Imran) Operation Manager (Sara Bano) Assistant Manager (Mirza Tanveer Baig) Cash Officer ( Ayesha)

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