Bank Al-falah

Bank Alfalah limited is a private bank owned by the Abu Dhabi Group. The Abu Dhabi Group is
led by Sheikh Nahayan Mubarak Al Nahayan a senior member of the Abu Dhabi Ruling Family.
Bank Alfalah was incorporated under companies ordinance 1984 on June 21, 1992. Bank started
its operation on November 1, 1992. Bank Alfalah is providing services related to commercial
banking as defined in the Banking ordinance of 1962.
H.H Sheikh Hamdan Bin Mubarak Al Nahayan is the chairman of bank. Bank has its head office
in Karachi and regional offices in Lahore, Karachi and Rawalpindi. Bank Alfalah is the sixth
largest bank in Pakistan with 471 branches across 163 cities in Pakistan (as on December 1,
2012). The bank also operates in Afghanistan, Bangladesh, Bahrain and a representative office in
the UAE.
The bank provides services to consumers, corporations and governments through a wide range of
products and services i.e. corporate and investment banking, consumer banking and credit,
securities brokerage, SME, agri-finance, Islamic and asset financing.
http://www.bankalfalah.com/
http://en.wikipedia.org/wiki/Bank_Alfalah

Analysis of last 3 years data

1,000,000
900,000

870,715

800,000

789,857

700,000 684,880
600,000
500,000
Deposits(Million Rs)

400,000
300,000
200,000
100,000
0
40148

40513

40878

During
December 2009 to December 2011 there has been a constant increase in amount
deposited in banks. This indicates a growth in the banking sector of Pakistan.

(Statistical survey Baking Chapter)

During December 2009 to December 2011 there has been a constant increase in the
amount of money in circulation. This is one of the reasons for inflation.

1,800,000
1,600,000

1,595,122

1,694,829

1,400,000 1,368,144
1,200,000
1,000,000
Currency in
Circulation(Million Rs)

800,000
600,000
400,000
200,000
0
40148

40513

40878

(Statistical survey Money chapter)

Since the fourth quarter of 2010 to the fourth quarter of 2012, the number of E-banking
transaction is increasing. This shows the increasing acceptance of E-Banking.
80,000

74,562

70,000
60,000
50,000

66,189
53,367

40,000

Number of E-Banking
Transactions

30,000
20,000
10,000
0
Q4 2010

Q42011

Q4 2012

(Statistical survey Baking Chapter)

Deposits created by business are increasing which shows the growth of business in
Pakistan.

60,000.00
50,000.00

48,270.10

40,000.00
34,567.10

30,000.00
20,000.00

Business
Deposits(Million
Rupees)

16,540.40

10,000.00
0.00
40148

40513

40878

(Statistical survey Baking Chapter)

Increase in the number of fixed deposit accounts is a positive sign for the banking sector.
Because the amount banks can invest for longer term is increasing.
350,000
300,000

298,969

282,222

250,000
200,000 203,360
Fixed Deposits
Accounts(5 years and
above)

150,000
100,000
50,000
0
40148

40513

40878

(Statistical survey Baking Chapter)

480,000.00
460,000.00
440,000.00
420,000.00

Advances to
government(Million
Rupees)

400,000.00
380,000.00
360,000.00
40330

40695

41061

Increase

in

the amount owed to banks by the federal government is an evidence of the risk adverse
nature of the banks. This is also shows that banks are not reluctant to deal with
government.

(Statistical survey Baking Chapter)

Growth in the amount invested in national saving schemes is not good for banks because
the amount banks can invest and earn returns is used for national saving schemes.

250,000.00
224,767.70

234,943.70

200,000.00

188,357.10

150,000.00

224,767.70 234,943.70
188,357.10

100,000.00

National Saving
Schemes(Million
Rupees)

50,000.00
0.00
2009-10

2010-11

2011-12

(Statistical survey Baking Chapter)

Increase in the number of personal accounts is a positive sign for the growth of banking
sector. Because it shows the growing habit of saving by people and banks would use
these saving for their investment purposes.

32,000.00
31,331.60

31,000.00
30,000.00

29,572.50

29,000.00
28,000.00

Number of Personal
Accounts

27,000.00 27,044.00
26,000.00
25,000.00
24,000.00
40148

40513

40878

(Statistical survey Baking Chapter)

Increase in the number of Call deposit accounts is not a good sign for the banks because
an increase in the call deposit account means banks should have large amount of money
in reserve to pay to account holders when they come to withdraw amounts.
170,000
166,181

165,000
160,000
155,000
150,000

151,069

Call Deposit Account

151,503

145,000
140,000
40148

40513

40878

(Statistical survey Baking Chapter)

DEEP-LIST Analysis
Demographics
Pakistan has population of 18 million. 43.4 % of the total population is under 15 years and
53.09% is between the ages of 15-64 years. Male population is 52.03 % and female population is
47.97%.
Literacy rate among male is 54.81% and 32.02% among females.18.30 % of population is under
primary.17% of population is Matric qualified and 1.58% is MA/MS qualified.
96.28 % of the total population is Muslim and remaining population comprises of Christian,
Hindu and Qadiani.
Punjabi, Sindhi, pushton, Balochi, Urdu speaking and Saraiki are different ethnic groups in
Pakistan.
Six million Pakistanis live in other countries; they send their remittances by using the services
provided by banks.
http://www.census.gov.pk/Statistics.php

Economic
In current budget sales tax has been increased from 16% to 17%.During last five years Average
inflation has been 13%. Pakistan has trade deficit of 16.7 billion. In 2012 GDP was 231.2 billion
USD with an annual increase of 4.2%.Currently Pakistan has budget deficit of Rs 1,046.22
billion (4.4 per cent of the GDP).

110.0
105.5

105.0
100.0
96.5

95.0
90.0

88.3

89.8

Exchange rate of $

85.0
80.0
75.0
40148

40513

40848

41518

Value
rupee is constantly decreasing currently US dollar is being sold for PKR 105.5.

of

Pakistani

Foreign direct investment is increasing in the country. This is positive sign for the growth of
economy and industry.

FDI(million US $)
140
120
100 96.4
80

125.4
111.7

60
40
20
0
40148

40513

40817

(Statistical survey selected indicators chapter)

During 2012-013 there has been investment of 314.2 million $ in the financial Sector of
Pakistan.

300

275.1

250
201.7

200
150

131.8

FBR Tax Collection

( Billion Rs)

100
50
0
40148

40513

40695

FBRs tax collection is

increasing every year which means increase in taxes.

Figures of FDI and tax collection taken Statistical bulletin of 2012, Chapter of
Selected economic Indicators.

http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/17-May2013/budget-deficit-soars-to-over-rs-1-046b
http://www.pakboi.gov.pk/index.php?option=com_content&view=article&id=180&Itemid=137

Environment or Ecological
Environment is the most neglected aspects in Pakistan. Industries throw their industrial waste in
rivers and canals; emit dangerous gases through their chimneys without any watchdog to stop
them. All big and small cities lack proper drainage system which eventually leads to throw the
waste of whole city into canal or river passing nearby.
According to The Express Tribune, 20.024 million tons of solid waste is generated every year in
Pakistan which is growing at 1.8% annually. There is not any landfill or disposal site to deal with

this huge quantity of waste material even in big cities like Lahore and Karachi. open dumping
and open burning is being practised which leads to dangers for health of human and all other
living species.
http://tribune.com.pk/story/381697/the-cost-of-inefficient-solid-waste-management/
According to the Environment chapter of the Economic Survey of Pakistan 89% of total
population has access to clean drinking water. There is only one federal air pollution monitoring
station, 5environmental protection tribunals, 7 fixed air quality monitoring stations, 3 mobile air
quality monitoring stations and only 5 analytical laboratories. (Pakistan Economic Survey 201213)
Recent year flood brought huge loss of $1.91 billion to agriculture sector of Pakistan and 183
human lives. Banks can turn this catastrophe into an opportunity by offering farmers and others
insurance policies to compensate the losses sustained through flood and other catastrophe. But
this catastrophe can be source of loss to the infrastructure of banks.
http://www.businessinsurance.com/article/20130830/NEWS09/130839992

Political and Legal

Political environment in Pakistan is unstable. Since its inception in 1947, it has faced martial law
four times. Political elite of Pakistan appoint people of their choice on all major designations by
ignoring the merit. Political parties belong to families, where one generation after the other from
the same family governs the political party.
Every passing day brings changes to government regulations; law and policies. People in
government are often found to be involved in corruption. Ruling elite of country is tax evader.
Ministers get loan from banks and then dont pay back. Famous Punjab Bank financial scam is
one example.
Pakistan is facing terrorist activities since it became an ally to NATO force for war on terror.
Pakistan has lost 49000 human lives as yet, 15681 are army personnel among these 49000
casualties. 5152 persons have injured so far. The $ value of losses suffered by Pakistan is 100
billion.

http://www.thenews.com.pk/Todays-News-13-23252-Pakistan-suffered-$100-bn-losses-in-waron-terror
http://tribune.com.pk/story/527016/pakistani-victims-war-on-terror-toll-put-at-49000/

Social
Pakistan is a Muslim country. People follow the teachings of religion in their day to day life e.g.
Pakistanis strictly follow the concept of lawful food (Halal). Ladies cover their head, veil their
faces and are not free to work.
Pakistanis have a collective life style, ones parents and even grand parents live together in one
home. People celebrate many festivals, some festivals are religious and others part of the culture.
Muslims have been living with people of other religions for centuries in subcontinent; therefore,
Muslims of Pakistan have adopted traditions of other religions too.
Marriages in Pakistan are mostly decided by parents. People spend heavy amount on marriages
to meet the requirements of large feasts and dowry. Tradition of dowry is common among people
regardless of rich and poor. Poor people cannot heavy expenses of marriage. Therefore, banks
can take it as an opportunity by offering schemes, where people save for the marriage of their
children.
Leisure activities of the Youth of Pakistan are transforming. These are shifting from physical
activities to online world i.e. social media, heavy usage of cell phones etc.
http://tribune.com.pk/story/527016/pakistani-victims-war-on-terror-toll-put-at-49000/
http://www.defence.pk/forums/economy-development/265557-pakistan-suffered-100-bn-losseswar-terror.html

Technology
Technology is one of the most crucial variables which determines the success of failure of any
bank. Technology helps banks to provide services to their customers round the clock. This is the
era of E-Banking and Mobile Banking. These two new types of banking options are possible
only because of the technological elements.

Technology is helping both the customers and the banks by allowing them to do their transaction
at any time and any place through internet. This is saves the time and effort of both the banks and
customers because customers dont have to visit the bank and involve the employees of the bank.
Therefore, the efforts and time of both ends are saved which can be utilized in other tasks.
But all this technology oriented banking is not drawback free. It has its own shortcomings too.
Accounts can be hacked and heavy can be done to the bank and the customers.
Any failure to keep pace with technological advancement means compromise over the efficiency
and eventually profits.

Opportunities and Threats

Opportunities
General environment is creating following opportunities for banks.

96.28 % of total population is Muslim. This creates an opportunity for the riba-free

services.
43.4 % of the total population is under 15 years. This segment can be targeted by offering

saving schemes for their future.

47.97% of female population in a male dominant society creates an opportunity which

can be targeted by offering empowerment oriented programs.

Increase in FDI.
Banks can offer insurance program to compensate the loss of catastrophe e.g. flood and

earthquake.
Banks can offer saving package for marriage expenses.
Over the last three years number of E-banking transactions has increased therefore, banks

can offer more e-banking services.

Increase in the number of fixed deposit accounts over the last 3 years creates an

opportunity for banks to invest more in long term projects.

Increase in business deposits over the last 3 years creates opportunity for banks to offer

more services to business community.

Technological advancements
Over sees population

Threats

Increasing inflation
Increasing Taxes
Natural Catastrophes
Terrorist activities
Increasing interments in national saving schemes
Increasing Value of dollar
Ever changing legal regulations
Increase in call deposits
Political scams like Punjab Bank scandal
Technological problems e.g. hacking.

Bibliography
http://www.bankalfalah.com/
http://en.wikipedia.org/wiki/Bank_Alfalah
http://www.census.gov.pk/Statistics.php
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/17-May2013/budget-deficit-soars-to-over-rs-1-046b
http://www.pakboi.gov.pk/index.php?option=com_content&view=article&id=180&Itemid=137
http://tribune.com.pk/story/381697/the-cost-of-inefficient-solid-waste-management/

http://www.businessinsurance.com/article/20130830/NEWS09/130839992

http://tribune.com.pk/story/527016/pakistani-victims-war-on-terror-toll-put-at-49000/
http://www.defence.pk/forums/economy-development/265557-pakistan-suffered-100-bn-losseswar-terror.html
http://www.thenews.com.pk/Todays-News-13-23252-Pakistan-suffered-$100-bn-losses-in-waron-terror
http://tribune.com.pk/story/527016/pakistani-victims-war-on-terror-toll-put-at-49000/