INTERNSHIP REPORT ON

UNITED BANK LIMITED PAKISTSAN

ZIA SATTAR M.COM ROLL NO: 148 Session 2009-2011

Bahauddin Zakariya University, Multan

PREFACE
In Masters of COMMERCE, Internship Program is an important part to give students an opportunity to have experience of practical field. Unless and until the students experience the novelty of practical work, their knowledge of what they study in theoretical courses remains incomplete. The most important point in an Internship Program is that the student should spend their time in a true manner and with the spirit to learn practical orientation of theoretical study framework.

This internship report is on my six weeks practical training at United Bank Limited ADDA KATTIANWALI BRANCH(1434). In this internship report I have tried to give details about the United Band Limited, working and the functions of different departments of the bank.

ACKNOWLEDGEMENT
All praises to almighty Allah and our holy prophet Muhammad PBUH who gave me the courage and patience for completion of this final report. I wish to acknowledge my gratitude to my inspiring Teachers for their endless their persistence, support and encouragement, and for providing me a lifetime opportunity to work with UNITED BANK LIMITED. I am also very thankful to UBL MANAGER and the operations Manager Mr.Waqas who gave me opportunity to work with experienced persons in their organization. I am also thankful to my parents, family and friends that continually offered encouraging support

ZIA SATTAR M.COM (Accounting)

HISTORY OF BANKING
Bank is a pipeline through which currency moves into and out of circulation. Bank accepts deposits and repays cash to its customers on their demand. The Bank borrows money at a lesser rate of interest and lends it to the borrowers at a higher rate. It is thus a profit-lending concern. Bank cannot lend all the money that has been deposited with it. It has to keep a certain portion of the total deposits in cash with them in order to meet the cash requirements of the individuals and business concern.

BANKING HISTORY
Word Bank is said to be derived from the words Banc us or Banque or Bank. The history of banking is traced to as early as 2000 BC. The priests in Greece used to keep money and valuables of the people in temples. These priests thus acted as financial agents. The origin of banking is also traced to early goldsmiths. They used to keep strong safes for storing the money and valuables of the people. The persons who had surplus money found it safe and convenient to deposit their valuables with them. The FIRST STAGE in the development of modern banking, thus, was the accepting of deposits of cash from those persons who had surplus money with them. The goldsmiths used to issue receipts for the money deposited with them. These receipts began to pass from hand to hand in settlement of transactions because people had confidence in the integrity and solvency of goldsmiths. When it was found that these receipts were drawn in such a way that it entitles any holder to claim the specified amount of money from goldsmiths. A depositor who is to make the payments may now get the money in cash from goldsmiths or pay over the receipt to the creditor. These receipts were the earlier bank notes. The SECOND STAGE in development of banking thus was the issue of bank notes. The goldsmiths soon discovered that all the people who had deposited money with them did not come to withdraw their funds in cash. They found that only a few persons presented the receipt for encashment during a given period of time. They also found that most of the money deposited with was lying idle. At the same time, they found that they were being constantly requested for loan on good security. They thought it profitable to

lend at least some of the money deposited with them too the needy persons. This proved quite a profitable business for the goldsmiths. They instead of charging interest from the depositors began to give them interest on the money deposited with them. This was the THIRD STAGE, in the development of banking. By experience the banks came to know that they could keep a small proportion of the total deposits for meeting the demands of customers for cash and the rest they could easily lend. They allowed the depositors to draw over and above the money actually standing to their credit. In Economics terminology we can say that they allowed the overdraft facilities to their depositors. This was the FOURTH STAGE, in development of banking. When every bank issues receipts and most of them allowed the overdraft facilities, there was then too much confusion in the banking system. The banks in order to earn profits could not keep adequate reserves for meeting the demands of the customers for cash. The failures on the part of the bankers to return money caused widespread distress among the peoples. In order to create confidence among the people, steps were taken to regulate the banking organization. A conference was held in Nuremberg in 1548. It was decided that a bank should be set up by the state, which should streamline the banking organization and technique. The first central bank was formed inGeneva in 1578. Bank of England was established in 1694. The responsibility of issuing of notes is now entrusted to a central bank of each country.

COMMERCIAL BANKING INPAKISTAN:

At
the time of partition total number of Banks were 38 only. Out of these Banks the Pakistani Banks were only 2 , Indian Banks 29 & Exchange Banks were 7. The total of deposits of Pakistani Banks was Rs.880 Million. & advances were Rs: 198 Million.. According to banking companies ordinance Banks are the companies, which transacts the business of Banking in Pakistan. Commercial Banks have constituted the most important [part of the intuitional credit in the economy of Pakistan. Being the largest source of credits, BankingIndustry is a pivot of whole the economic activities in Pakistan. Section 37(2A) of State Bank of Pakistan Act 1965 lays down that the Banks must have paid-up capital & reserve of not less then Rs: 5 Lac & fulfilling certain other requirements for declaring as Scheduled Bank.

At the time of independence Bank services was badly affected. But with the passage of time these are improving. The government of Pakistan nationalized all Banks in early 1974. This act was done to minimize control of few hands over banking. But this step was proved e futile for the

Banking in Pakistan. So the Govt. had to revise its decision in1990. Two Banks (Allied Bank Of Pakistan Limited & Muslim commercial Bank Of PakistanLimited have been denationalized. Since then Banks were working well. Now slogan of the Banks is to serve their customers in the best possible manner. Professor Berton: Banks are the guardian & distributor of money . Similarly we can say that it is a pipeline thorough which currency moves into & outside the circle. Banks accept deposited of money and repay it on demand. Bank borrows money at lesser rate of interest & lends it at higher rate of interest. In this way Banks earn money. Bank do not lend all money they collect, they keep certain portion of it as reserve to meet the uncertain demand of the custom FUNCTIONS OF A COMMERCIAL BANK In general terms the functions of a commercial bank can be classified under the following main heads. 1. ACCEPTING DEPOSITS Some people have an excess money and they want to deposits it to some honest man or an institution which can give them some profit. So the first function of commercial bank is to receive deposit there are three types of deposits.

1.1 Demand Deposits or Current Deposits Some people deposit their excess money in the current accounts and they can withdraw their money deposited in this account at any time during the banking hours, so bank is not ready to give interest on it 1.2 Fixed Deposits These deposits are fixed for a particular period. Commercial banks also pay an interest on these accounts. An important thing related to it is the varying interest rates for the different period deposits. Interest rate increases with the increase in the fixed deposit period. 1.3 Saving Deposits To create the habit of savings, bank accepts the saving deposits and pays an interest on these deposits. And this rate of interest is greater than the demand deposits. 2. ADVANCING LOANS Bank also advances the loans to the merchants and charges the interest. It is the major source of its income. It also issues the loan for short term, medium term and for long term. And bank receives the higher interest from the borrower for the long term loans offered. 3. DISCOUNTING OF BILL Commercial banks also discount the bills and facilitate the business; for example one businessman purchases anything from another person and promises to pay after one month. The seller will write a bill to the buyer and there will be an order that after one month the buyer will pay the amount to the seller. Buyer will sign on the bill. In other words buyer will accept the responsibility of that amount. If seller is in need of money, he will take it to the bank and will receive the money by discounting the bills. The commercial bank also may rediscount it from the central bank.

4. CHEAP MEDIUM OF EXCHANGE By issuing cheques and drafts bank provides cheap, medium of exchange. 5. TRANSFER OF MONEY The commercial bank is very helpful in transferring the money from one place to another by issuing the drafts. This is very popular concept in the modern world and widely used in the business community. 6. CUSTODIAN OF PRECIOUS ARTICLES Banks also provide lockers for the safety of precious articles. So now everyone can secure his precious metals like gold, silver, etc., and bank charges a very nominal charge for this facility. 7. AGENCY SERVICES Commercial Banks also perform the duty of an agent. It collects and pays on the behalf of the customers. 8. INVESTMENT On behalf of the customers all the banks also make an investment in different companies and industries. And banks receive nominal charge from the customers. 9. CREATION OF CREDIT

It also creates and extends the volume of credit. 10. FACILITATING TRADE ACTIVITIES

It also provides the finance to the foreign trade. Letter of credits are issued by the commercial banks for the foreign payments. 11. PURCHASE AND SALE OF SECURITIES

The commercial bank purchases and sells the securities, for itself and sometimes on the behalf of the costumes. 12. ACTING AS A TRUSTEE If a client directs his bank to act as a trustee in the administration of a business, the bank performs this responsibility.

ROLL OF COMMERCIAL BANK DEVELOPMENT OF PAKISTAN:

IN

THE

ECONOMY

Banks play an important role in the economic development of country. If our Banking system is not in accordance to the economic requirement then how it can play a vital role in our developments. The State Bank of Pakistan is at the apex and all the commercial Banks have to follow the rules of State Bank of Pakistan. Role of the banking sector can be judged by the following facts: SAVING MOBILIZATION: The commercial Banks namely United Bank Limited Pakistan, Habib Bank Ltd, Allied Bank Of Pakistan Ltd. & National Bank has opened Branches in urban areas & rural areas to mobilize savings of people.

FINACCING OF DEVELOPMENT PROJECTS: Banks & other financial institutions like ADBP, IDBP, and PICIC etc. Advances short & medium terms loans for financing of the development projects both in the private & public sectors .So they helping to accelerate the rate of progress (Economic) in the country. ENHANCING TRADE ACTIVITIES:

The credit institutions collect the savings of people & make them available for facilitating the trade activities both inside & outside the country. CREATING CLIMATE FOR CAPITAL FORMATION: A developed baking system stimulates the growth of economy by creating favorable climate for capital formation in the Country.

HELP OF STATE BANK OF PAKISTAN IN ACHIEVING MONETARY PUBLISHES:

Commercial Banks under the supervision & guidance of the S.B.P help in implementing & achieving the objective of monetary policy, which vary from time to time. ASSISST IN PLANNED DEVELOPMENT: Commercial Banks are profit-seeking enterprises. In order to maximize profit they have the incentive from S.B.P to maximize the limit of finance. An organized Banking system keeps balance between the liquidity * profitability, thus assists in the planed development of the Country. PROFIT SHARING SCHEME: Commercial Banks receive surplus balance of the households and business & pay interest on the deposit of client. The depositors instead of having a fixed return on the deposit will share in the profit & loss of the Bank. The profit & loss scheme arrangement is the alternative to interest, under an Islamic economic system, which is since on the experimental basis in Pakistan.

INTRODUCTION OF UNITED BANK LIMITED

United Bank Limited was established on 7 November 1959. The first president of the UBL was Mr. I. I. Chundrigar. Most of the branches of Union Bank Ltd. were merged into UBL to work as UBLs subsidiary .The head office was at Dhaka. UBL is one of the largest nationalized banks in the country. With almost forty years of good standing to its valued clients, it has stood the test of time, producing assets of over Rs. 101 billion. UBLs deposits, being guaranteed by the Government of Pakistan, are 100% secure. UBL has assets of over Rs. 140 billion, capital and reserves of over Rs. 3.2 billion and a solid track record of 43 years, in addition to the convenience of over 1400 branches serving throughout the country and also at several overseas locations. UBL, with an integrated network of 1400 branches domestically, with 19 overseas locations, gives direct access to a comprehensive range of better banking facilities to help its customers monitor their business internationally.

Some Key Information about the UBL Date Established President Branches (as on Jun 2002) Employees (as on Jun 2002) November 7, 1959 Mr. Amar Zafar Khan 1419: 1400 domestic, 19 overseas branches 14000 Employees

REORGANIZATION OF DOMESTIC OPERATION In 1986, the organizational structure of domestic operations of the bank was reformed and decentralized on the basis of provinces. As a result provincial headquarters were established at Karachi, Lahore, Peshawar and Quetta in order to meet the needs of sanctioning loans and other facilities to the trade, industry and agriculture of each province. Azad Kashmir was serrated from NWFP and made separate region. The quantum of work immensely increased due to the growth of economic activities and phase of industrialization and other change in Punjab and Sind. It was also considered necessary to improve the quality of advances and to expedite the recovery process of the loans and advances. Beside above the economic condition of the country also changed due to privatization policy, establishment of a number of new private banks as well as expansion for operations by the foreign trade and banks in major cities. For above changes, high power committees constituted by the Govt., which recommended structural, and other reforms, the details of which are received from Pakistan banking council are follows: FORMATION OF REGIONAL HEADQUARTERS The provincial chiefs of Punjab, Sind, NWFP, and Baluchistan are ceased to function and in their place nine regional chief executives started functioning in the nine major cities. The new segmentation of UBLs branches on the basis of regions can be looked from the following:

PROVINCE WISE REGION ALLOCATION

Province/Area Sind Do Punjab Do Do Do NWFP Baluchistan Azad Kashmir Region Name Karachi Hyderabad Lahore Faisalabad Multan Islamabad Peshawar Quetta MuzafarAbad

Domestic Network of Multan Region

Multan Region Head Office Multan Bahawalpur Dera Ghazi Khan Rahim Yar Khan Sahiwal Vehari

225Branches 1 48 38 36 32 38 32

COMMUNITY SERVICES UBL is committed to the welfare of Pakistan. It lends to farmers for the purchase of tractors, superior quality seed and fertilizers. UBL further fosters the individual welfare and well being of the common man by lending house building finance and loans to set up small businesses. UBL has played a leading role in the dissemination of Computer Technology in Pakistan and is dedicated to the promotion of sports. Agricultural Loans Small Business Scheme UBL Computer Training Institute Staff Colleges of UBL UBL Sports Complex AGRICULTURAL LOANS UBLs agricultural loans on easy terms and conditions to small-scale land owning farmers boost the countrys economy and yield greener harvests. UBLenables farmers to buy good quality seeds, fertilizers, pesticides and agricultural implements. SMALL BUSINESS SCHEME Under the Small Business Scheme, UBL is providing loans on easy terms to those who wish to set up their own small-scale business. This scheme is aimed at spreading prosperity in the country by reducing unemployment. As more and more people start their own industrial units, the country will move steadily towards economic self-reliance.

UBL COMPUTER TRAINING INSTITUTE UBL is a pioneer in the computerization of banking in Pakistan, and now plays a leading role in the dissemination of Computer Technology in Pakistan and is proud to be a part of the Governments Computer Literacy Program aimed at preparing the younger generation to meet the challenges of tomorrow. UBL, the leading user of Computer Technology in the Banking Sector has set up most modern facilities at Muzaffarabad, Azad Kashmir, and Sheikhupura for imparting training to the educated youth under the Governments Computer Literacy Program. These centers are equipped with state of the art hardware and audio-visual aids and are manned by experienced professionals. STAFF COLLEGES OF UBL The UBL has three staff colleges, which are generating banking trained personnel. These colleges are at Karachi, Lahore and Rawalpindi, established in 1964, 1978 and 1977 respectively. These staff colleges are providing facilities of training to the employees of the bank so as to meeting the growing need of the banking field and coping with the changing environment of the country. UBL SPORTS COMPLEX In addition to providing professional banking services, the bank continued to play an important role in the promotion of sports in the country. Towards this end, the bank has already constructed a big sports complex in Karachi, where all types of facilities for sports like cricket, hockey and flood light courts for tennis and basketball have been provided.

CONSUMER BANKING UTILITY BILL COLLECTION UBL has over 1300 branches collecting electricity, gas, telephone and WASA, and other utility bills like demand notice for telephone connection during business hours. Almost all the branches have special utility bills collection counters with sun-shelters and drinking water. Separate booths for utility bill collection are available at all major cities for the convenience of the public. Branches in all major cities have electronic bill collection machines. And now-adays UBL management is trying to launch on-line banking system in all over the Pakistan. For this purpose some of the branches have been equipped with this on-line facility. For the customers convenience, UBL accepts cheques for payment of utility bills. DISH, TV LICENSE FEE COLLECTION UBL is one of the main collecting agents of PTV collection fee for issuance of licenses/renewal of licenses at its authorized branches all over the country. PLS - SAVING ACCOUNT UBL offers PLS Savings Account that can be opened with an initial deposit of Rs. 10,000. The share of profit is credited half-yearly to the PLS Saving accounts and is calculated on monthly balance. Depositors can withdraw their savings by presenting cheques at the particular branch of UBL during banking hours. But under the new private management each saving account holder can withdraw his amount in a week.

PLS UNI-SAVER ACCOUNTS PLS UNI - SAVER accounts are Special PLS - saving account with several built-in special features and benefits for the depositors. Profit is calculated on a daily product basis: PLS - TERM DEPOSITS UBL offers the following most attractive and highly profitable deposit schemes to suit the customers requirements. Deposits are fully secure and you earn high profits. Deposit period along with Indicative profit rates are shown below:

Declaration of Rates of Profits on PLS Term Rates in 2003 after Privatization

Period 3 months 5 Years

Profit Rate 2.90% 3.90%

PRODUCTS AND SERVICES

The bank provides its customer various products & services, to cater their need of investments and other social or business requirements. These Product & Services offered by the bank are as follows:

UNIZAR
Following type of UNIZER accounts are available:

CURRENT SAVINGS SPECIAL NOTICE TERM DEPOSIT ACCOUNTS

Deposits can be maintained in US$, and other currencies like Yen. Your UNIZAR account is: Freely convertible. Easily transferable. Free from all exchange control regulations. Worldwide access with the flexibility to operate internationally with real convenience. Take advantage of the appreciation of foreign currency. Withdrawal of funds without any restrictions. Free from all exchange control restrictions. The declared rates of profit on UNIZAR deposits for disbursement for the half year 30-06-2000 is as follows:

SMALL BUSINESS SCHEME

Under the Small Business Scheme, UBL is providing loans on easy terms to those who wish to set up their own small-scale business. This scheme is aimed at spreading prosperity in the country by reducing unemployment. As more and more people start their own industrial units, the country will move steadily towards economic self-reliance. The tax descriptions on the UNIZAR account: Tax Type Income fax Wealth tax With-holding tax Zakat deduction % Nil Nil Nil Nil

The customers can open a UNIZAR account with foreign currency notes or a foreign remittance in the form of: Drafts, Cheques, Money orders, Mail transfers, Telegraphic Transfers, Travelers Cheques, F.E.B.Cs. D.B.Cs., subject to rules.

UNICARD
UNICARD is valid throughout Pakistan and is accepted by: Airlines prestigious hotels Hospitals large super markets Petrol stations prestigious stores

 Restaurants Supermarkets With UNICARD there is no hassle of paying bills and counting cash. Just sign the bills and take your leave.

UBL is the pioneer in introducing Credit Card Culture in Pakistan. The UNICARD is like passport to carefree enjoyment. UNICARD saves money of the holder: the holder of the UNICARD have a record of all the expenditures.

UNICASH
UBL offers you a self-service banking facility called UNICASH. You can obtain UNICASH cards and use the Automated Teller Machines, which are installed, at convenient locations called Cash points. You can avail the following self-service banking facilities Balance Inquiry Mini Statement Cash Withdrawal Confidential Personal Identification Number (PIN) ensures that only the holder can use your ATM Card. The PIN protects against misuse in case of card is lost. Customers can change their PENT anytime they want. Customers can specify flexible weekly withdrawal limits. Customer can withdraw your weekly limit in one go, or in multiple

installments. Customers can use UNICASH Cards at UBL Cash-points located in the following cities:

City Islamabad

Cash Points 7

Rawalpindi

Karachi

UAE

Bahrain 3

RUPEE TRAVELLER CHEQUE

UBL offers the facility of the Rupees Traveler Cheque. UBL Rupee Travelers Cheques are the ideal and safest way of carrying cash when traveling anywhere in Pakistan.

Used for conducting day- to-day business. No commission is charged from the purchaser. No excise duty on purchase. Easy to obtain and encash from all designated 350 branches of UBL. Acceptable all over Pakistan. Good until used and have unlimited life. Easily transferable like an order cheque.

DEPOSIT DEPARTMENT
Deposits act as a backbone of bank. It is the lifeblood of every bank. These deposits are source of generating incomes for the bank and for the general public to meet the financial needs. The supply of money in circulation is also affected by the amount of loans and advances issued by the bank. The primary economic function of the commercial bank is to receive the surplus saving money from the general public, individuals, firm, institutions, public houses and companies and to pay the cheques drawn upon the bank. The bank accepts the deposits at a low rate of interest and lends it at higher rate of interest, the difference between the lending and accepting rate is the Source of income for the bank. Keeping in view the above factors UBL offers the following types of accounts: 1) Current Account 2) Saving Account 3) Fixed Account The classification of the deposits in to current, saving and fixed accounts is mainly on the basis of duration and purpose for which the account is maintained at a bank CURRENT ACCOUNT Current account is running account because, customer can withdraw deposited amount at any time, whenever he feels need. The customer can withdraw without any prior notice to the bank. The bank has to pay the cheque provided within the limits of the account balance. The main thing is that bank does not pay any kind of interest on current account. The bank cannot invest the deposited amount under current account heading, because of the fear of withdrawal. Bank has to keep with it a higher reserve ratio to meet the needs of the current account holders.

SAVING ACCOUNT Saving Account is an important source of funds for the bank. The purpose of this account is to attract the small saving of the general public. Normally workers, schoolboys and employees of the organizations use the saving account facility. UBL also provides this facility to the general public against a certain rate of interest. The new name of this account is now a day is PLS-Saving Account. If a customer wants to withdraw a large sum of money (above 15000), he will have to give a notice of 7 to 14 days in writing to the bank. Saving account deposits provide a chance to the bank to invest safely, because customer can withdraw small amount of balance. FIXED OR TERM DEPOSITS Fixed or Time deposits accounts are the major source of the capital for investment for the bank and cannot be withdrawn as in case of the current account. The amount deposited can be received back after a certain specified period of time. The rate of interest paid on fixed Deposits is normally higher than saving Deposits. The rate of interest also varies due to time period. After the expiry of the period the customer presents the receipt to bank and received the amount in cash or bank added in the customer accounts as agreed between bank and customer. OPENING OF THE NEW ACCOUNT A customer can open the following three types of accounts: 1) PLS-Saving Account 2) Current Account 3) Fixed Account

1) Opening of saving Account Saving account is also divided into two types further, I. II. Individual saving account Joint Saving Account I. Opening of Individual Saving Account An individual person can open this type of account. UBL has defined the following procedures for the opening of individual saving account: Signature specimen card, the bank to get authorized signature of the customer as specimen for avoiding any future discrepancy gives Customer. Account opening form, when a customer comes to open the new account in the branch he is given a printed form, to be filled by him. Account opening form consists of full name, address, and date of birth, occupation, telephone number, and N.I.D. card number. Guaranteed by the existing account holder, when the new account holder fulfills all the requirements then he is asked to give some existing account holder guarantee, so that in future the new account holder may not fraud with the bank. II. Opening of Joint Saving Account: Opening procedure for the joint saving is same as in case of individual saving account. Just the difference is in the account opening form. Signature specimen card is also used for the same purpose as for the individual saving account, to avoid future discrepancy. Account opening form, joint saving opening from has same information more than one time because more than one person fills this form to open the account. Briefly is that no one/single person can open this account, as a result it is called joint saving account. Rules and Conditions for Saving Account: The account opening person knows the rules and conditions. This account can be opened only with initially Rs. 100 not less than this amount. 1) PLS- Saving account may be opened by/in the name of individual or jointly, or by charitable institutions or provident funds or other funds, associations, societies and firms or clubs.

2) For opening of this account application has to submit on the prescribed form by the bank. 3) Customers can deposit money in his account by using pay-in-slip. 4) Customer must check the signature of two officer of the bank on the deposit slip. 5) Withdrawal, depositor cant withdraw more than his balance or one quarter. At least 7 days notice must be given to bank for withdrawal purposes. 6) Bank cant responsible for a cheque, which has been paid prior to receipt of written instructions from the drawer countermanding payment. 7) The bank will take care to see that credit and debit entries are correctly adjusted, but if any mistake is by the depositor/withdrawer than bank will not responsible for the loss. 8) If the account is closed the unused cheques must be returned to the bank for the cancellation and the balance amount, if any must be withdrawn. 9) The profit or loss on the balance due at the time of death will be paid when bank will declare its profit/loss for the half year. 10) Death of account holder, in absence of any instructions the credit balance outstanding in any joint account in the name of two or more persons will be payable to the survivors. 11) The bank to the account holders will supply statement of account every quarter. 12) Amendments of rules, the bank have a right to amend, alter or add to any of these rules with or without notice to the account holders. 2). Opening Of Current account A person, businessman and organization can open the following types of current account. I. II. III. IV. Joint Current Account Individual Current Accounts Sole proprietorship Current Account Partnership Current Account

I.

Joint Current Account

More than one person can open joint current account. Minimum balance of this account is Rs.l0, 000 approx. If a joint holder dies then bank holds the account and refers case to the court. Account opening form, this application form is divided into two sides and both sides have same information which are details of signatory (A, B), name, occupation, nationality, place and date of birth, national identity card number, business address, employer no. Etc.

II.

Individual Current Account

Only one person can open individual current account. Minimum balance in this case is 2500, if the balance in the account is less than this limit than bank sends a statement to account holder to maintain the minimum balance. For withdrawal, checkbook is issued and used no other instrument is used or accepted by the bank. Procedure for opening this account is also same as in PLS-Saving account just the difference is in opening form information, required by the bank.

III.

Sole Proprietorship Current Account

In sole proprietorship organization a person invests his capital and devotes full time to his business. Sole proprietor opens this account. Minimum balance that required in this account is Rs. 1000. All the profit paid on balance will go to the sole proprietor only. The account opening form of this account is different than others because this form is filled in the name of the organization. The name of proprietor. Place and Date of birth, Nationality, Passport number and National Identity Card number, have to mention on this form.

Documents Required Following documents certified copies are required with the application: a) Most recent set of Account b) Current Municipal Licensee c) Commercial Registration Certificate. IV. Partnership Current Account Partnership current account can be opened with the name of Partnership Company. Before opening of partnership account shareholders has to decide that how many partners have right to sign on cheque. The procedure is same for opening such account; the difference is in the account opening form. Account opening form shows the name in full, nature of business, principal place of business, address, location, and telephone number, telex number. After that this form is divided into four sides with the name of A.B.C.D. and showing the same information mentioned earlier Rules and Conditions 1) Bank can close /down any account at any time upon 48 hours write notice, after the opening of the account. 2) The account number should be mentioned on all correspondence with the bank when deposits or withdrawals are made. 3) 4) 5) The account holder must maintain the minimum balance requirement that is Rs: 1000. After six-month bank refuse the payment of the cheques (post dated cheques). Bank will not make payment if cheque is made unauthorized.

6) Account holder who is unable to sign, he will affix his left-hand thumb. 7) The cheque amount should not exceed to balance of account. 8) Any person opening a current account is deemed to have read, understood and bound by the bank rules and conditions of current account.

ACCOUNTS DEPARTMENT
It is said that accounts department is the backbone of the bank. It plays a vital role in performing different banking functions. The accounts department at UBL Hussain Agahi branch is performing its function manually. Different books of accounts relating with other departments are maintained here. With the help of these books of accounts, accountant prepares monthly, quarterly, semi-annually and yearly financial statements. The working in accounts department mainly depends upon voucher system. For each and every transaction-taking place in the bank vouchers are prepared and through these voucher contra entries are passed under different heads. FUNCTIONS OF ACCOUNTS DEPARTMENT The accounts department performs the following functions: (a) (b) (c) (d) To prepare and maintain the vouchers. To maintain and update the ledgers for term deposits. To update general ledger. To prepare different periods statements. Vouchers Each and every transaction in the bank is made through vouchers; the final place is accounts department for recording these vouchers. Officer in the accounts departments arranges these vouchers according to heads of accounts. These vouchers are of two types: 1. Debit Vouchers 2. Credit Vouchers

These two vouchers are again classified into three following types of vouchers:

I. II. III.

Cash Voucher Clearing Voucher Transfer Voucher

All the daily transaction in cash, transfer and clearing is done through these vouchers. A sheet is prepared on which all the vouchers, passed during any one working day are consolidated and summarized. This sheet is called supplementary sheet. It provides help in preparing Cash Book. There are two types of supplementary sheets: Debit Supplementary Sheet: In which all debit Cash Voucher, Clearing Voucher, Transfer Voucher are included. Credit Supplementary Sheet: In which all credit Cash Voucher, Clearing Voucher, Transfer Voucher are included. Cash Book It is maintained to keep the record of daily receipts and daily paid vouchers. Cashbook is consisted on the opening balance and the closing balance of the day. For correct balance of the cash book there is a need to arrange all the vouchers. Ledger For Term Deposits One of the functions of accounts department is to maintain and update the term deposit ledgers and books manually. Term deposit receipt or TDR ledger is updated after every month for estimation of profit on customer accounts. Accountant has to prepare different ledger for all schemes of term deposit. With the help of TDR the accountant prepares provisional ledger/Summary ledger and also statement of provisional expenses. The profit after every six-month will be the expense of the branch.

Updating General Ledger When vouchers are recorded in cashbook then the balance of each head of account is posted to its ledger account. There are two main heads of the general ledgers, Income account & Expenditure account. All the accounts fall under one of these two main heads. Separate ledger register is maintained for every head of account. In UBL all the daily transactions in deposits, cash, clearing, transfer remittance, foreign exchange; advances are performed through these daily ledgers. Accounts department Maintains and prepares the following ledgers and books of accounts: I. Daily General Ledger Expenses II. Daily General Ledger Incomes/Receipts III. Monthly General Ledger Assets IV. Monthly General Ledger Liability V. Daily General Ledger Zonal Expenses VI. Daily General Ledger Inspection expenses. VII. Daily General Ledger Regional Expenses VIII. Daily General Ledger Audit Expenses The format of the entire above ledger is approximately same. General ledger tells about A/C No., description, previous Balance, Dr. Amount, Cr. amount and running balance. Preparation of Different Statements Accounts department prepares these statements, a) Statement of Affairs b) Statement of provisional Income c) Statement of provisional Expenses d) Statement of Head office A/C e) Balance confirmation Book/Report f) Transfer Book

Statement of affairs is prepared yearly, consisting on the details about assets and liabilities of the branch. This statement provides assistance in budgeting about branch.

Statement of provisional Income and expense is prepared monthly. Statement of account and balance confirmation is sent to accounts holders.

LOCKERS UBL is also providing lockers facilities to its customers. The account department also maintains the record about lockers. The basic purpose of locker is to provide safe custody to clients valuable ornaments, jewelry or documents. Almost in all branches, Lockers are available in different sizes at different rates. For availing this opportunity, customer has to open his account in the same branch/bank. Locker Operating Procedure: Bank provides an application form to the applicant who needs to operate a locker in the branch. This application form contains all rules and regulation regarding to obtain a locker. Specimen signature card is also filled in signed by the applicant. Bank assigns a password to their customer for secrecy. Each locker has duplicate keys. One (master) key is kept by the bank, and the other by the customer. In case of opening any locker, first of all master key is applied and then the customer key. If the locker has been obtained jointly then at the time of the opening, the person signed the application form, should be presented there otherwise, the bank will not allow to operate the locker. Bank officer has to maintain the following register for record keeping purposes of locker. I. II. III. Locker Register Operation Register Key Deposit Register

Safe deposit locker fee is recovered in advance or at the start of the year, half-year or quarterly.

Types of Locker There are basically three types of locker at UBL that are as under:

TYPES OF LOCKERS

RATES OF LOCKERS Per Annum

Small Medium Large

Rs. 1200 Rs. 1800 Rs. 3000

The key deposit fee is Rs. 600. Per locker and it is refundable at the time of closing an account the breaking charges are Rs. 500 per locker and it is also refundable at the time of closing of account, provided there is no breaking

BILLING COLLECTION
This department basically deals in bills, which come in bank for collection. The bills are cheques, call deposit, drafts and pay order. These bills are from outstation branches of UBL or of other banks. This department provides services to customers at low charges to get their amounts from the nearest branch. HEADS OF BILLS There are two main heads of the bills i.e. Outward Bills For Collection (OBC) Inward Bill For Collection (IBC) Outward Bills for Collection Bills department receives cheques or other kinds of bills from its clients. The condition under Outward Bills for Collection is that the customer must have his account in the branch. This branch forwards the cheque with schedule or covering letter to that branch on which bill is drawn. The checking officer of bills department will cross the cheque with special bank stamp before forwarding the cheque to the other branch.

Outward bills for collection register Outward bills for collection register is maintained in order to deep the records of all bills for outward collections. This register is updated two times, first at time of receiving the OBCs and secondly at the time when confirmation advice is received from the other branch, either the cheque will be paid or not by the other bank branch. After confirmation of the amount, confirmation advice is transferred to the sender branch. After confirmation of the amount and bills, the account of the customer is credited against reasonable charges, which is income for the bank.

Inwards Bill for Collection These bills come to branch for payments so branch has to verify these cheques, pay orders, drafts and call deposits etc. The party account must be opened in that branch which sends it to paying branch .The responsibility under IBCs of the branch is to verify all the bills within three days, and should send the bank advice to the originating branch. Inward bills for collection register Inward bills for collection register are maintained for future record purposes. Care is made while posting the amount of bills in the register. Each bill is assigned a number according to the register series. Every year the number starts from one and continues for the whole year and next year again from one and so on.

REMITTANCES DEPARTMENT
Transfer of money or equivalent to money from one branch to another branch of the same bank is called remittance. Now it has become an easier and safer method both for the client and banker to transfer their money from one branch to another within the city or Outside City. PARTIES INVOLVED In case of remittances normally two banks are involved, are as under: Originating Bank Branch It is the branch, which issued the instrument for remittance. Responding Bank Branch The branch that receives the instruments for remittances, also known as drawees branch: TYPES OF REMITTANCE Remittances are classified into the following two types: 1) 2) Inland Remittance Foreign Remittance

1) Inland remittances It is a transfer of money from one branch to another branch of the same bank within the same country. In this case both the parties will be of the same country and same bank. MODE OF REMITTANCES United bank limited, uses following types for transfers of money: 1) 2) 3) 4) Demand Draft (DD) Pay Order (PO) Mail Transfer (MT) Telegraphic Transfer (TT)

MONEY GRAM
Time is Money, so dont keep your family waiting

Money gram service is a person-to-person international money transfer service that allows consumers to send/receive money around the world in minutes, with no bank account required.

FEATURES OF MONEY GRAM

FAST With money gram your money can be transferred from almost any country in the world because it is a reliable and trusted way to send/receive money worldwide. SAFE The money gram service is used around the world because it is a reliable and trusted way to send/receive money worldwide. CONVENIENT More than 50,000 MoneyGram agent locations in more than 150 countries; computer networked to ensure that your money is transferred within minutes. Easy: (How to Receive your transfer) 1- Sender abroad goes to nearest MoneyGram representative, fills out a form, hands in the amount he wishes to send and the send (service) fee**, and shows an I.D. 2- Upon completing the transaction, sender will be given a transaction reference number. 3- Sender calls the receiver and informs him of the transaction reference number and the amount of money sent. 4- Receiver can go to any MoneyGram representative, show an I.D, fills out a simple form mentioning senders name and amount expected. 5- Receiving agent hands over the money to receiver.

NOTE: Currency exchange rate set by Money Gram or its representatives will be applied

SWOT ANALYSIS
STRENGTH
UBL has got a well reputed on line system in most of its branches. Remittance department is working very efficiently in transferring the funds to peoples due to this system The bank also has started ATM facility in most of the branches 24 hours banking is now the trend in Pakistan. Bank is providing quick credit services to all the customers at all branches. Because the credit manager cooperates with the borrowers while making a loan request to the bank.

WEAKNESSES
The human resource department is not performing well in the organization. Selection process is not done on the merit due to which many competent persons cant get job in UBL. Bank is not introducing new products these days, so bank should boost the product development and increase the range of facilities offered for customers. And the rates of interest on its various products have been reduced. Privatization has adversely affected the morale of the employees because they will not be able to get the expected fringe benefits, so it may lead to job stress.

OPPORTUNITIES
Government is taking very bold steps to promote IT in Pakistan UBL has an opportunity to improve in IT stock exchange is very volatile and takes immediate effect so in times of crises conservative investors turns to saving deposits. UBL is surrounded by many competitors it has an opportunity to aggressive marketing to increase its business.

THREATS
UBL has many competitors who are continuously increasing their products and marketing aggressively it may cause its customer to shift to its competitors. a. Financial Analysis 1. Ratio Analysis a) Liquidity Ratios Liquidity ratios measure a firms ability to meet its current obligations. These include: Current Ratio = Current Assets / Current Liabilities This ratio indicates the firms ability to pay its short term liabilities by those assets expected to be converted to cash in the near future. Current assets normally include cash, marketable securities, accounts receivables, prepaid expenses and inventories. Current liabilities consist of accounts payable, short-term notes payable, accrued taxes, and other accrued expenses.

Year Current Assets Current Liabilities Current ratio

2007

2008

2009 362,079,596 558156110 0.06

308,271,290 378,293,973 483713620 554222342 0.64 0.68

(Rupees in 000)

Ratio 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2007 2008 2009 Ratio

Interpretation: Standard ratio for current ratio is 2:1. In all the year current ratio is unsatisfactory. It means that UBL has not made sufficient investment in current assets. The reason behind that UBL business is based on large size of deposits so its current liabilities has more than larger than current assets. Acid Test Ratio = Liquid or Quick assets /current liabilities Liquid assets = cash and marketable securities Year
Liquid assets Current liabilities

2007 57,622,360 483713620 0.12

2008 50,143,570 554222342 0.09

2009 61,252,772 558156110 0.11

Acid Test Ratio

Ratio 0.14 0.12 0.1 0.08 0.06 0.04 0.02 0 2007 2008 2009 Ratio

Interpretation: Standard ratio for Acid Test Ratio is 1:1. All the years Acid Test Ratio is unsatisfactory and below standard or Normal ratio from 1:1.

Sales to Working Capital: Sales to Working Capital = Sales / Working Capital Sales to working capital give an indication of the turnover in working capital per year. A low working capital indicates an unprofitable use of working capital. Year Sales Working Capital Sales to Working Capital
Ratio 0 2007 -0.05 -0.1 -0.15 Ratio -0.2 -0.25 -0.3 -0.35

2007 41,962,131 -175442330 -0.24

2008 53,097,381 -175928329 -0.30

2009 61,495,472 -196076514 -0.31

2008

2009

Interpretation: Because of inappropriate use of working capital sales figure gives the negative ratio. In recent year there is a net loss. Working capital= Current assets Current Liabilities Positive working capital means that the company is able to pay off its short-term liabilities.
Working capital is also called net working capital.

Working Capital: Working Capital = Current Assets Current Liabilities It is the difference between current assets and current liabilities. It is used to measure a company's efficiency and its short-term financial health. Working capital is also called net
working capital.

Year Current Assets Current Liabilities

Working Capital

2007 308,271,290 483713620 -175442330

2008 378,293,973 554222342 -175928369

2009 362,079,596
558156110

-196076514

Ratio -170000000 2007 -175000000 -180000000 -185000000 -190000000 -195000000 -200000000 Ratio

2008

2009

Interpretation: In all consecutive years from 2007 to 2009, UBL has Negative working capital it means that a company currently is unable to meet its short-term liabilities with its current assets. b) Leverage Ratios: Leverage means operating a business with borrowed money. It is a combination of assets, debt, equity, and interest payments. These ratios are used to understand a company's ability to meet it long term financial obligations.Leverage ratios measure the degree of protection of suppliers of long term funds. These include: Time Interest Earned:
Time Interest Earned Ratio = EBIT / Interest Charges

EBIT stands for Earning before interest and tax. The interest coverage ratio tells us how many times the company can cover its interest charges from its EBIT.The ratio is designed to understand the amount of interest due as a function of companys earnings before interest and taxes (EBIT). This ratio measures the extent to which operating profit can decline before the firm is unable to meet its annual interest cost/expense. Year EBIT Interest Charges EBIT ratio 2007 1379 Nil 1379 2008 1405 Nil 1405 2009 -14392 Nil -14392

Ratio 4000 2000 0 2007 -2000 -4000 -6000 -8000 -10000 -12000 -14000 -16000 Ratio 2008 2009

Interpretation: As the UBL uses no debt in its capital structure so the EBIT ratio is hundred percent for the years 2007, 08 but in 2009 UBL has to face an impairment loss on revaluation of assets. Fixed Charge Coverage Ratio: Fixed Charge Coverage Ratio: = Net Operating Income / Total Debt The ratio shows the capacity of a firm to meet its total debt (Short and long term debts) by its operating income/profit.

Year Total debt

Fixed Charge Coverage R
Ratio 0.35 0.3 0.25 0.2 0.15 0.1 0.05 0 2007 2008 2009

2007 65487949 0.21

2008 14,052,051 56743538 0.25

2009 14,392,181 49158077 0.29

Net Operating Income 13,796,269

Ratio

Interpretation:

This ratio is a good sign for the bank. Because in incoming year from 2007 to 2009, it shows the strong capacity of a bank to meet its total debt (Short and long term debts) by its operating income/profit. Debt Ratio: Debt Ratio = Total Debt / Total Assets The ratio of total debt to total assets, generally called the debt ratio, measures the percentage of funds provided by the creditors. The higher the ratio, the more leverage the company is using and the more risk it is assuming.Low leverage means low risk for the Bank.

Year Total debt Total Assets Debt Ratio

2007 65487949 546,795,871 0.12

2008 56743538 620,240,530 0.09

2009 49158077 640,449,529 0.08

Ratio 0.14 0.12 0.1 0.08 0.06 0.04 0.02 0 2007 2008 2009 Ratio

Interpretation: After calculating debt ratio, it came to know that this company is low leveraged .Because incoming years leverage is coming to fall. Debt to Equity Ratio: Debt to Equity Ratio = Long term debt / Total Equity First of all I want to define the sources of capital which are two in numbers. 1. Equity 2. Debt

Generally this ratio describes the capital structures of the company. It provides detail around the amount of leverage (liabilities assumed) that a company has in relation to the money provided by shareholders. The debt to equity ratio gives the proportion of company assets that are financed by debt versus equity. A high debt to equity ratio implies that the company has been aggressively financing its activities through debt and therefore must pay interest on this financing. Year Total debt Total Equity Debt To Equity Ratio 2007 65487949 36,399,410 1.79 2008 56743538 45,076,576 1.26 2009 49158077 55,914,736 0.88

Ratio 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2007 2008 2009 Ratio

Interpretation: Total debt = Short term borrowing + Long term debt. Total equity = Share capital +Reserve +Unappropriated profit. In the year 2007 and 2008 total debts are exceeds than the total equity so it leads to high leverage. But in the year of 2009 UBL is not leveraged one. Debt to Tangible Net worth Ratio:

Year Total debt Net worth Debt To Net Worth Ratio

2007 65487949 47890938 1.79

2008 56743538 49395663 1.26

2009 49158077 67318363 0.88

Ratio 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2007 2008 2009 Ratio

Interpretation: In the year of 2007 ratio is at maximum point whereas in the year of 2009 it is satisfactory which is 0.88. Current Worth / Net worth Ratio: Current Worth to Net worth Ratio= Current Worth / Net worth Ratio I calculate current worth and net worth by using this following formula: Current Worth = Total Current Assets Total Current Liabilities Net Worth = Total Assets - Total Liabilities Year Current Worth Net Worth Current to Net worth Ratio
Ratio 0 2007 -0.5 -1 -1.5 -2 -2.5 -3 -3.5 -4 Ratio

2007
-175442330

2008 -175928369 49395663 -3.56

2009 -196076514 67318363 -2.91

47890938 -3.66

2008

2009

Interpretation: The ratio gives negative values because its current assets are not sufficient to meet its current liabilities. In recent year 2009 instead of improving the ratio is unsatisfactory which a bad sign is. Total Capitalization Ratio: Total Capitalization Ratio = Long-term debt / long-term debt + shareholders' equity

This ratio is used to measure the debt component of a company's capital structure, or capitalization (i.e., the sum of long-term debt liabilities and shareholders' equity) to support a company's operations and growth. Year
Long Term debt Long term debt + Equity Capitalization Ratio

2007 3261 36402671 8

2008 1978 45078554 4

2009 611 55915347 1

worth Ratio
Ratio 9 8 7 6 5 4 3 2 1 0 2007 2008 2009 Ratio

Interpretation: After calculating the ratio, it came to know that UBL uses little long term debt in its capital structure. Fixed Asset Ratio / Equity Ratio: To calculate this ratio two ratios are required. One is Fixed Asset Ratio which is calculated as the following formula: (1) Fixed Assets Ratio= Net Fixed Assets/Long term funds This ratio establishes the relationship between long term funds and fixed assets.Since financial management advocates that fixed assets should be purchased out of long term funds only. Long term fund = Equity + Long term Debts Year
Net Fixed Assets

2007 308,271,290 36402671 8.47

2008 19,926,915 45078554 0.44

2009 23,734,082 55915347 0.42

Long term funds

Fixed Assets Ratio

Ratio 9 8 7 6 5 4 3 2 1 0 2007 2008 2009 Ratio

Interpretation: After calculated the ratio it is clear that in the year of 2009, Long term funds are enough to purchase the long term or fixed assets. (2) Equity Ratio: Equity Ratio = Equity/Total assets Equity ratio is also called shareholders equity to total equity/net worth to total assets/ and also called Proprietors ratio.

Year Equity Total assets Equity Ratio

2007 36,399,410 546,795,871 0.07 Times

2008 45,076,576 620,240,530 0.07 Times

2009 55,914,736 640,449,529 0.09 Times

Ratio 0.1 0.09 0.08 0.07 0.06 0.05 0.04 0.03 0.02 0.01 0 2007 2008 2009 Ratio

Interpretation: The amount which is calculated through this Ratio shows the equity of the Bank. It means remaining funds have been supplied by the outsiders. Now combining the ratios from 2007 to 2009. Fixed Asset Ratio / Equity Ratio for 2007= 8.47/0.07 =121 Fixed Asset Ratio / Equity Ratio for 2008= 0.44/0.07 = 6.23 Fixed Asset Ratio / Equity Ratio for 2009= 0.42/0.09 =4.67 Long term Assets versus Long term Debt Long term Assets versus Long term Debt= Long Term Assets/ Long Term Debts Year Long Term Assets Long term debt L.T Assets /L.T Debts worth Ratio
Ratio 100000 90000 80000 70000 60000 50000 40000 30000 20000 10000 0 2007 2008 2009 Ratio

2007 308,271,290 3261 94532

2008 19,926,915 1978 10074

2009 23,734,082 611 38844

Interpretation:

Long term assts are in greater proportion than long term debts. Result is that the assets are being financed by equity rather than long term debts. It is a good sign for the Bank. c) Profitability Ratios: Profitability ratios measure the earning ability of a firm. These ratios examine the profit made by the firm and compare these figures with the size of the firm, the assets employed by the firm or its level of sales. The long-term profitability of a company is vital for both the survivability of the company as well as the benefit received by shareholders. These ratios are used to measure of corporate profitability and financial performance. Now I want to analyze the profitability ratios which are as follows: Net Profit Margin: Net Profit margin = Net Profit / Sales x 100 Actually Net Profit Margin gives the net profit that the business is earning per dollar of sales.This margin indicates the profit after all the costs have been incurred it shows that what percentage (%) of turnover is represented by the net profit. An increase in the ratios indicates that a firm is producing higher net profit of sales than before. In fact, Net Profit is Net Profit after Interest and Tax.

Year Net Profit Sales Net Profit Margin

2007 9,237,015 41,962,131 22%

2008 8,445,251 53,097,381 16%

2009 9,487,952 61,495,472 15%

Ratio 25% 20% 15% Ratio 10% 5% 0% 2007

2008

2009

Interpretation:

Result is that the Net Profit Margin was 22% in the 2007, decrease to 16% in 2008 and then decrease to 15% in 2009.It is a not a good sign.Because it leads to decrease continuously. Return on Assets: Return on Assets (ROA) = Profit after Taxation / Average Total Assets *100 Profit after taxation is generally called Net Profit/Income, which is calculated after including interest and tax in Operating Profit. If ROA is above the rate that the company borrows at then the project should be accepted, If ROA is below the rate that the company borrows at then the project should be rejected.

Year Net Profit Average total assets

ROA

2007 9,237,015 273397935.5 3.38%

2008 8,445,251 310120265 2.72%

2009 9,487,952 320224764.5 2.96%

Ratio 4.00% 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 2007 2008 2009 Ratio

Interpretation: Return on assets decreased in 2008 and 2009 and it is maximum in year of 2009. Return on asset has been gradually decreased so investment in fixed assets is not appropriate in 2008 and 2009. In the year of 2009 it gives some increment than the year of 2008.In the year of 2007 ROA gives maximum value. DuPont Return on Assets: DuPont Return on Assets = Profit after taxation/Total Assets x 100

Year Net Profit Total assets Dupont ROA

Ratio 1.80% 1.60% 1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% 2007 2008

2007 9,237,015 546,795,871 1.69%

2008 8,445,251 620,240,530 1.36%

2009 9,487,952 640,449,529 1.48%

Ratio

2009

Interpretation: Calculated ratio is satisfactory in the year of 2007 but decreases in 2008 and also comes down than the previous year in year of 2009.It is not a good sign for the bank. Operating Income Margin: Operating Income Margin = Operating Income / Net Sales*100 Operating income is called operating profit which is calculated after subtracting the selling and administrative expenses from Gross profit/Income.

Year Operating Income Net Sales

Operating Income Margin

2007 13,796,269 41,962,131 32.88%

2008 14,052,051 53,097,381 26.46%

2009 14,392,181 61,495,472 23.40%

Ratio 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2007 2008 2009 Ratio

Interpretation: Operating income margin is decreased in three consecutive years, from 2007 to 2009.So it is a bad sign for the Bank. Maximum value which is satisfactory is in the year of 2007, but in incoming years it is going on decrease. Operating Assets Turnover: Operating Assets Turnover = Operating Assets/ Net Sales Operating Assets are assets in which include, Cash and balances with treasury banks, Balances with other banks & Operating fixed assets. Year Operating Assets Net Sales
Operating Assets Turnover Margin
Ratio 2.5 2 1.5 Ratio 1 0.5 0 2007

2007 87644926 41,962,13 1 2.08

2008 84610791 53,097,381 1.59

2009 99036844 61,495,472 1.61

2008

2009

Interpretation: UBL has few sales than its competitors and made investment in fixed assets rather than current assets. In the year of 2007 calculated value is satisfactory. But in incoming years it will be on decreasing. Return on Operating Assets: Return on Operating Assets = Profit after Taxation/ Operating assets*100

Year

2007 9,237,015 19,040,39 0 48.51%

2008 8,445,251 19,926,915 42.38%

2009 9,487,952 23,734,082 39.98%

Net Profit

Operating assets
Return on Operating Assets

Ratio 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% 2007 Ratio

2008

2009

Interpretation: After calculating the Return on Operating Assets it is crystal clear that value is decreasing in the years to come. In this scenario maximum value is in the year of 2007 but in incoming years it is on decreasing. Sales to Fixed Assets: Sales to Fixed Assets = Net Sales / Fixed Assets This ratio indicates that how much sales are contributed by investment in fixed Assets.

Year Sales Fixed Assets Sales to Fixed Assets

2007 41,962,131 19,040,390 2.20Times

2008 53,097,381 19,926,915 2.66Times

2009 61,495,472 23,734,082 2.59Times

Ratio 3 2.5 2 1.5 1 0.5 0 2007 Ratio

2008

2009

Interpretation: It is clear that Sales are increasing in comparison with investment in fixed assets in 2007.In the year of 2008 maximum value which is satisfactory for the Bank. Return on Investment: Return on Investment = Net profit before interest and tax/Capital employed*100 In the ratio capital employed is calculated with the help of following formula: Capital employed = Fixed Assets+ (Current Assets Current Liabilities) Working capital Year 2007 2008 14,052,051 -156001414 -9% 2009 14,392,181 -172342432 -8.35%

Net profit before I &T 13,796,269 T Capital employed -156401940

ROI

-8.82%

Ratio -8.30% 2007 -8.40% -8.50% -8.60% -8.70% -8.80% -8.90% -9.00% -9.10% Ratio

2008

2009

Interpretation: It is also called Overall Profitability Ratio. It indicates the percentage of return on the total capital employed in the business.It is clear that in the consecutive three years return on capital gives negative figure which is not a good sign.

Analysis, Suggestions & Recommendations

During my internship at the UBL I find out week areas that require improvements for long-term benefit of the organization. These suggestions and recommendation are as follows: 1. Computerization

IT has changed the old method of making business. So, compuretization in UBL is become the basic need. Though UBL has the computer system yet the system has not totally shifted on computer. Manual procedure is still there, Hence computer facility is not fully availed and many branches are working without computer and computer system, it should be fully availed and system should be fully computerized. Compuretization will save to much timewhich is wasted due to manual procedures. 2. E-Commerce

This world is now called a globle world becaused it is connected through computer network. In todays networked world e-commerce is getting importance day by day. All the leading banks of the world are adopting the concept of online banking and they are providing better services to their customers through the Internet.

3.

Performance Appraisal & Compensation

Employee appraisal is an major part good and effective HRM. It consist of systematic evaluation of an individual with respect to his personal traits and characteristics, his on job performance and his potential for development. In Unite Bank Limited there is no appraisal system exists. No relationship has so far been established between appraisal and staff motivation. No weight is assigned to appraisal in making decisions on promotions, postings, etc.. 4. Product Marketing This is age of competition and every organization is facing hard competition from not only domestic organization but also from the international organizations due to globalization. Due to this competition the marketing department plays a vital role in the success of the organization. UBL should have a strong marketing department like many other private banks have, for the publicity of their products and make well inform the customers all the services provided by the bank and to conduct detailed market researches to find out new opportunities, needs of the customers and make comprehensive plans to capitalize those opportunities. 5. Appearance Physical appearance of the location and inside the building also matters. It helps a lot to attract the customer. Some branches of UBL are very attractive but all the branches should be well dressed 6. Refresher Training Courses

There should be proper staff training refresher courses programs to train the employees latest tool and techniques of the banking. They should be given be given computer training.