Internship Report

Bank Alfalah Limited

CHAPTER I
BANK ALFALAH LIMITED
1.1 HISTORY OF THE BANK ALFALAH
This bank on June 21st 1992 was incorporated as a public limited company under the
companys ordinance 1984. November 1st 1997 was the day when it's banking operations
commenced. Bank Alfalah deals in commercial banking and other services associated
with it as defined in the Banking Companys ordinance 1962. The bank has almost 336
branches in more than 100 cities all across Pakistan. In addition to that it has branches in
Bahrain, Bangladesh and Afghanistan. The registered office is at B.A. Building I.I
Chandrigar Road Karachi. Since 1997 the management of the bank has implemented new
strategies and policies to give the bank a distinct position in the market place. Bank
Alfalah is owned by the Abu Dhabi Group. The management of the bank has invested a
huge amount of money in new and revolutionary technologies to provide its customers
with an extensive range of excellent products and quality services. The management of
the bank is committed to strengthen its bond of trust with its customers and provide them
with uninterrupted services. The management of the bank strives to serve its customers
with the products and services according to their requirements. During the last five years
Bank Alfalah has emerged as one of the foremost financial institutions in the country.
There is an interesting attribute of bank Alfalah which is its Islamic banking branches
through out the country. Thus in addition to that conventional banking practices if offers
Islamic banking branches to its customers. Hence Bank Alfalah has two types of branches
in Pakistan:
1-

Conventional Banking Branches

2-

Islamic Branches

The privatization in July 1997, Habib credit and Exchange Band assumed the new
identity of Bank Alfalah on February 25, 1998. It is now Abu Dhabi based bank as the
family of Sheikh Nahayan Mubarik Al-Nahayan purchased 70% of its shares and 30%
shares remained with Habib Bank on behalf of Government of Pakistan. Charged with the
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strength of Abu Dhabi consortium, and under the leadership of His Highness Sheikh
Nahayan Mubarik Al-Nahayan, Minister of Higher Education and Scientific Research,
Government of Abu Dhabi, and a prominent member of Royal Family, the bank is
energized with the vision, envisaging the development of various sectors in Pakistan.
Since the inception of Bank Alfalah, by the grace of the Almighty, we have moved
rapidly in expanding our branch network and deposit base, along with making profitable
advances and increasing the range of products and services. We have made a breakthrough in providing premier services at an affordable cost to our customers. Keeping in
view our valued clients and the need for constant and effective communication of
information, we have designed this website to be as user-friendly as possible. As we
pursue the path of excellence, customer satisfaction remains our priority. It is only when
we know our customers better, can we deliver a higher quality of services, thereby adding
synergy to our existing management expertise, financial strength and profitability.
1.2 INTRODUCTION OF THE BANK ALFALAH
The bank has already made significant contribution in building and strengthening
both corporate and retail banks sector in Pakistan. Assessment of the needs and wants of
customer is an ongoing process at Bank Alfalah, which help to centennially develop new
products of services. Designing the product portfolio in response to royal patriot, royal
custodial, Alfalah car finance, Alfalah rupee traveler cheque and home loans are prime
example of quality innovation providing timely banking opportunities to customer. To
continuously offer courteous, professional and advanced banking going through training
programs with focus to information technology has recently rejuvenated solution the
team of bank.
With their key indicators of progress a steady soaring to new heights, the bank is
committed to dedicate all its energies, resources and time to bring higher value and
satisfaction to their customers and employees.

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Bank Alfalah Limited

Vision
To be the premier organizations operating locally and internationally that provided the
complete range of financial services to all segments under one roof
Mission
To develop and deliver the most innovative products, manage customers experience,
deliver quality service that contributes to brand strength, establishes a competitive
advantage and enhances profitability, thus providing value to the stakeholders of the
bank

Type of Ownership
Its a private limited under the Banking companies ordinance 1984
Sector of Company
Bank Alfalah is a Public Listed Company Our brand identity is the outward

expression of what we stand for as an organization.

Their Products are

Alfalah Car financing

Bank Alfalah home loan
Credit Cards
Agri-Finance

Designing its portfolio bank is committed to develop products that give more value to
its customers in both the sectors in corporate and consumer need.

Branches & Various Operations

As stated earlier there are two types of branches working in Pakistan. There are

total of 336 branches of this bank in the country. Among them there are 256 conventional
branches and 80 Islamic branches. Following is the complete list of its working branches
according to the Bank Alfalah Audited Report of the year 2010.

Table 1.2.1 Conventional Branches (Non-Islamic)

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City

Bank Alfalah Limited

No of Branches

City

No of Branches

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Bank Alfalah Limited

Karachi

55

Kasur

Hyderbad

Sarghoda

Sukkur

Chak 111SB

Gawadar

Gugrat

Jacobabad

Mardan

MirpurKhas

Bahawalpur

Larkana

Dina

Lahore

43

Khanewal

Manshehra

Jahanian

Bannu

Pir Mahal

Chitral

Depal Pur

Gojra

Narowal

Muridke

Lora Lai

Jaranwala

Bhakkar

Bahawalnagar

Kamoke

Islamabad

14

Chinnot

Fatehjang

Daska

Taxila

Hafizabad

Wah Cantt

Muzaffargarh

Hangu

Khanpur

Multan

Chichawatni

Sailkot

Arifwala

RY Khan

Chenabnagar

Gugranwala

Haveliah

Dharki

Lala Musa

Ahmed Pur

Rawat

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Bank Alfalah Limited

Table 1.2.2 Islamic Branches:

City

No of Branches

City

No of Branches

Karachi

18

Gugrat

Lahore

19

Dhudial

Islamabad

Pindi Ghaip

Rawalpindi

HasanAbdal

Faisalabad

Bewal

Sargodha

JalalPurJatta

Gugranwala

Khushab

Multan

Sangla Hill

Peshawar

SarariAlamgir

Sialkot

Quetta

RY Khan

Hyderabad

Kot Addu

Shah Kot

Sukkar

Kamalia

Mailsee

Mumtazabad

Vehari

Bahawalpur

Kabirwala

Abbotabad

DI Khan

Various Operations
Bank Alfalah limited is as banking company which performed the different types
of business activates as defined in the banking companies ordinance 1962. The bank is
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Bank Alfalah Limited

also listed at Karachi Stock Exchange and Lahore Stock Exchange. Mainly its keeps the
deposits of the peoples and provides the loans and also performs the below mentioned
business activities;

It keeps the deposits of the people and provides lockers and agency

services.
It provides short terms loans to industry, agriculture and construction.
It also deals import and export trade.
Selling and purchasing of Prize bonds.
Collection of all types of utilities bills.

Continuously offer courteous, professional and advanced banking going through

training programs with focus to information technology has recently rejuvenated solution
the team of bank. With their key indicators of progress a steady soaring to new heights,
the bank is committed to dedicate all its energies, resources and time to bring higher
value and satisfaction to their customers and employers.

Customers of the Bank Alfalah

Bank Alfalah almost has all market Customers like

Individuals
Business Persons
Corporate customer
Companies/Firms & Educational Institutions.

President

1.3 ORGANIZATION CHART

Chief Operating officer

Country Risk Manager Executive

Head of Country operations
Vice President

Executive
Vice President

Chartered
Accountant
16

Information
Department

Corporate
Heads

Branch
Manager

Branch
Managers

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Bank Alfalah Limited

Figure 1.3.1

1.3.2 Branch Hierarchy

Branch Manager

Operations Manager

Accounts Deptt
(Financials & Account
Opening)

CD Incharge

Operations
Department

Remmitance Deptt &

Cash Deptt

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Bank Alfalah Limited

Figure 1.3.2.1

As in most organizations, the total employees of the Bank are categorized as:

Top Management
Middle Management
Front-Line Management
Operatives

The top management is responsible for making organization wide decisions and
establishing the politics and strategies that effect the entire organization. The level
between the supervisory level and the top level of the organization. Operatives describe
those organizational members who work directly on a job or a task and have no
subordinates. Key area of responsibility of all the executives is different from their job
description.
1.4 FUNCTIONS PERFORMED BY THE DEPARTMENTS
Bank Alfalah has a number of departments in a branch however it is possible that
a specific department may not be present/ offering its servicing in a branch. For example
credit card department may not be present in a branch.
Account Opening Department
This Department is responsible for the opening and closing of all sorts of bank
accounts. This department mainly comes under the general banking facilities being
provided by the bank. The process of opening an account starts by filling out a form and
submitting your CNIC. The form demands to input information like the person's name,
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Bank Alfalah Limited

DOB, address etc. A person can fill the form according to the type of account he wishes
to open at the bank. Alfalah generally offers three types of accounts which are:
123-

Accounts for Individuals

Accounts for Partnerships
Accounts for Companies

Remittances Department
Remittance means the transfer of funds from one account to another or from one city
to another city. All banks charge a fee on such transfers and so it is a source of income for
the banks. The instruments which are used for transferring money are:
1234-

Pay Order
Demand Draft
Money Gram
Call Deposit Receipt

Operations Department
In the clearing department the transferring of funds is done. The transfer of
money/ funds may take between the same banks or between different banks. Clearing is
done for cross cheques in the following two ways:
Inward Clearing
The inward clearing takes place when Bank Alfalah's account holder draws a
cheque in favour of a non Alfalah's customer. The cheque is sent to the NIFT for clearing
purpose.
Outward Clearing
These are the cheques from other banks (other than Alfalah) that are in favour of
Bank Alfalah's customer. The cheque is sent to the NIFT for clearing purpose.
1.5 CRITICAL ANALYSIS OF THE BANK ALFALAH

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Bank Alfalah Limited

1.5.1 Financial Analysis

The analysis has got significant importance in the analysis of Financial. We have
discussed that these ratios disclose the financial position of business, how business is
being run how funds are arranged/ managed what is the past history / trend of firm and
what is expected in the future. All such factors are disclosed by the comparative study of
Financial Ratios. For the sake of discussion and knowledge I now discuss hereunder the
important Ratios that are important from the view point of Loan Proposal Scrutinizing
Officer i.e. analyst.
Table 1.1 Total Debt, Total Equity, Total Assets, Net Profit
Year

2012

2013

2014

Total Debt
Total Equity
Total Assets

457044400
25501657
536567969

525525770
28265616
611427624

605963224
37823827
743128293

Net Profit After Tax

4556121

4675950

5640851

Table 1.2 Return on Assets

Formula

2012

2013

2014

Net Profit after

8.4%

7.6%

7.5%

tax/Total assets

The return on assets percentage shows how profitable a company's assets are in
generating revenue. Above percentage of ROA tells you what the company can do with
what it has.
Table 1.3 Return on Equity
Formula

2012

2013

2014

Net Profit after tax/Total

17.86%

16.54%

14.91%

shareholder equity

ROE shows how well a company uses investment funds to generate earnings growth.
This ratio decreases in 2014 as compare to 2013. Decreases in 2014 it shows investor gets
low return on his investment than the previous year.
Table 1.4 Debt to Equity Ratio
Formula

2012

2013

2014

Total debt/total equity

17.92

18.59

16.02

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This ratio indicates how much debt a company is using to finance its assets relative to the
amount of value represented in shareholders equity.

Table 1.5 Total Debt to Total Assets

Formula

2012

2013

2014

Total debt/Total assets

0.85

0.86

0.81

This ratio shows us how much proportion of the assets financed by the debt. 0.81
proportion of Bank Alfalaf assets financed by debt.
1.5.2 MARKETING STRATEGIES
Bank Alfalah is famous because of its good strategies of marketing it continually
doo research to know the needs of the customers & planning different strategies to satisfy
& entertain customers queries. They have BDOs ( Business Development Officers ) in
their all branches who have liaisons with different people who can give them huge
amount of deposits BDOs working on this task to market Alfalahs name & catch the
good customers.
1.5.3 MAJOR COMPETITORS OF THE BANK ALFALAH
Since 2000 there has been a mushroom growth of the banks. A lot of well reputed
foreign banks have opened their branches in Pakistan as well. One way to look at the
competitors of Bank Alfalah is to consult the Banking Statistics of Pakistan report by the
State Bank of Pakistan. Following statistics are taken from the latest report of year 2010
published by the State Bank.

Habib Bank Ltd

UBL
MCB
Allied Bank Ltd
Standard Charterd
Askari Bank Ltd
Bank Al Habib
Meezan Bank
Faysal Bank Ltd
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Bank Alfalah Limited

According to this latest available information from the State Bank's report it is
clear that National Bank leads the market both in terms of assets and net profit for the
year 2010 with Habib Bank following closely behind. Bank Alfalah holds 6th position as
far as the assets are concerned. It has passed Standard Charted and has close competition
with Allied Bank. However it is note able that its profits are less as compared to other
banks and there is a reason that why they are less. Abu Dhabi group has heavily invested
in the Telecommunication sector of Pakistan. Warid Telecom and Wateen telecom are the
owned by the Abu Dhabi Group. Now these two sister companies are not making the
expected profits. Thus money is taken from the profit of Bank Alfalah. If measures are
taken in the sister companies to reduce the losses then the profits of Alfalah will
definitely rise. Also note able that NIB bank was the only one to face financial loses in
the year 2010.
1.5.4 SUCCESS & FAILURE OF BANK ALFALAH PRODUCTS
In my internship period I have always seen Alfalahs all products are on good
scale customers are satisfied with products offerings & using the services with
satisfaction.
1.5.5 MAJOR HR POLICIES & PRACTICES AT BANK ALFALAH LIMITED
The policies and practices involved in carrying out the People or Human
Resource aspects of a management position, including recruiting, screening, training,
rewarding, and appraising
The concepts and techniques need to carry out the people or personal aspects of
management job are:

Conducting job analyses (determining the nature of each employees job)

Planning labor needs and recruiting job candidates
Selecting job candidates
Orienting and training new employees
Managing wages and salaries (compensating employees)
Providing incentives and benefits
Appraising performance
Communicating (interviewing, counseling, disciplining)
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Training and developing managers

Building employee commitment

Human Resource Department-Hierarchy

Following are the responsibilities of HR Officer in Bank Alfalah:

Recruitment And Selection Section

Policy Making section
Retention Program
Improve Working Relation Of Employees
HRM Management Responding To Changing Environment:
Bank Alfalahs HRM Management is responding to changing environment by
Follow Customers Needs
Adopt Continuous Changes
Decentralized Organization

Performance Appraisal System

The performances of employees are appraised yearly at Alfalah Bank. The
Appraisal Methods at Bank Alfalah are
Self Appraisal Method

Ratting
Evaluation
Problems during Appraisal
Unfair Assessment (Bias)

Behavior Appraisal
In this service oriented industry behavior is as important as performance on job.
To manage behaviors and appraise company has devised a managing behavior system to
evaluate their core values. Each employee in such a system is rated against the behavior
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performance achieved, against the required benchmark applicable, depending on the Job
Grade.
1.5.6 COMPETITIVE ANALYSIS OF THE COMPANY (SWOT ANALYSIS)
1.5.6.1 Strengths

Bank has a belief in warm welcome with its great customer service
Alfalah is Backed by strong Abu Dhabi Consortium
Manager has good coordination with staff members.
Environment is friendly.
Products are excellent
Expansion is consistent
Modernized banking (online + Internet)
Fully computerized system even they are now improving it day by day.

1.5.6.2 Weaknesses

Mixed Culture
Staff is lesser.
Employees are strongly dissatisfied from their remuneration system.

1.5.6.3 Opportunities

Information Technology.
Internet and mobile banking
Establishing Foreign Branches
Local Setup Expand

1.5.6.4 Threats

Competition by the settled bank like MCB and others.

There is a possibility that in future the customers are too many to be handled

by the so small number of the employees.

Governmental policies may pose unpleasant role.
Global issues like America war and terrorism.
Employees less loyalty with Alfalah because of employees dissatisfaction.

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Bank Alfalah Limited

CHAPTER II
INTERNSHIP ACTIVITIES
2.1 DEPARTMENT OF BANK ALFALAH IBG CANTT, LHR
Functioning of Bank Alfalah is divided into following departments
1. Operations Department
2. Account Opening Department
3. Remittance Department
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2.1.1 OPERATIONS DEPARTMENT LAYOUT

Operations department of the Bank Alfalah Limited is responsible for the overall
operations of the bank. Mr. Usman (Ops Manager) is responsible for all function under
operation department.
The detail of those departments, which are controlled under this department, is as under.
1. Clearing
2. Remittances
2.1.2 DESIGNATION OF SUPERVISOR
My Supervisor names are
Mr. Alam is CD Incharge (Cash Department Incharge)
Mr. Usman (Operations Manager)
Mr. Mubashir (Relationship Manager)
2.1.3

QUALITY CONTROL MEASURES

Bank Alfalah views specialization and service excellence as the cornerstone of its

strategy. The people of bank innovation, creativity, reliability, customized services and
their execution are the key ingredients for their future growth. Based on this approach,
their Treasury Division and the Structured Finance Unit have been geared to provide
specialized services to the corporate customers. Revenues from these activities have
started yielding dividends and they expect significant growth in these areas in the coming
years.
They are aware that they have stepped into the 21st century and they must meet
its challenges by acquiring the highest levels of Technology. They will thus be
accelerating their enable them distribute their products and services through most
efficient and high-tech means. They say that they will invest in the modern tools and
substantial allocation of resources will be made to achieve this objective during the
current year. Their program to launch real time on line Banking Services and
introduction of ATMs at strategic locations have been firmed up and it will be fully
operational during the year 2001. Their focus would be to constantly seek out growth
opportunities through increased quality assets and by offering a wider range of products
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and services to their esteemed customers. There are significant growth opportunities for
BANK ALFALAH and they are confident in their ability to grasp them. They are
committed to enhancing the shareholders value and look forward with greater optimism
to a prosperous future for BANK ALFALAH. Based on the profit of Rs.354 million, the
Board has proposed that a cash dividend at a rate of Rs. 2.00 per share i.e. 20% of share
capital be distributed among the shareholders.
2.1.4

DEPARTMENT SYSTEM
HRM managers at Bank Alfalah are performing a great job as far it is concerned

motivating them and looking after them. Along with the other managers and employees
Department managers are also doing a great job in achieving company goals and
objectives. There is a very calm and friendly atmosphere at Bank Alfalah because of the
HRM department and their policies for keeping their employees happy, productive and
efficient.
2.1.5

WAGES/INCENTIVE PATTERNS

Pay Plans:
Pay plans Alfalah are establish on the basis of job ratings. All jobs are ranked
from top to bottom, on the bases of compensable factor. Employee with higher rank gets
highest pay and incentives.

Compensation Plans for Employees:

In Bank Alfalah, compensation plan for employees includes:

Basic Salary
Bonuses
Medical Facilities
Allowances
Incentive Plans:
In Bank Alfalah, incentive are provided to
Managers and Executives
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Bank Alfalah Limited

Middle and Lower Level Employees

Employee Benefit & Services

The employee benefits & services provided by Bank Alfalah are

Health & Life Insurance
Paid Annual Vacations, Leaves, Holidays
Health Insurance Of Parents
Pension & Provident Fund
Discount On Company Products
Annual Bonuses
Educational Plans
Social Events
Customized Services
Creative, Learning & Healthy Environment
Highly Qualified, Experienced & Committed Staff

2.1.6 ACTIVITIES PERFORMED IN DEPARTMENTS

2.1.6.1 Account Opening Department
It is most important department of bank and its major source of income for bank.
Mr. Mubashir & Miss Amber deal in this department. Following procedure is adopted for
this purpose.
Procedure of Account Opening
It is very simple and quick procedure. A person who wants to open an account
must have the introduction of banks staff. The customer is required to fill an account
opening form. Then signatures of the introduce are verified from S.S. Card (signature
specimen) before opening account. AOF is very standard and up to the mark which
contains almost whole information about customers. Customer is guide to fill all columns
of AOF. All formalities and requirements are completed and verified, and all supportive
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documents are taken and checked according to the nature of account. If any formality is
remaining incomplete, cheque book is not issued until it is fulfilled. Account number is
allotted to the customer and all particular such as nature of account, opening date, initial
deposit, title of accounts are written in register. Account is opened in the system (Bank
Excel) by putting all the particulars of the customers in the system. S.S. cards are handed
over to in charge of operations department for record and verification. The letter of
thanks is sent to customer for confirmation of address and other particulars of customers
and one copy is attached to AOF. After complete procedures finally the manager of bank
signs the AOF and these forms are filed in a proper sequence.
They also have to give identity letter

NIC copies

Income proof

Visiting Card

NTN (National Tax Number)

2.1.6.2 Types of Accounts

Individual Account
Any individual or proprietor of business can open an individual account at BAF.
PLS (Profit and Loss Sharing) saving accounts can be opened with the minimum balance
Rs. 1000/- with expected profit rate is 9%. Following requirements has to be fulfilled for
this account.

Signature of customer on back of AOF.

Mention next of kin (nominee)
Name and A/C # of introducer.
Verified sign of introducer.
Customer signature admitted by officer.
N.I.C photocopy attached.
Letter of thanks.
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Joint Account
When different people want to or need to share a single account it is called joint
account. The names of persons are written on the title of A/C and on S.S. card. Single
person cannot open joint A/C. Both persons have to sign on cheque. When two or more
person neither partner nor trustee open account in their name is joint account.
Requirements

Sign of both customers on back of AOF

Sign on joint A/C # mandate
Name and A/C # of introducer
NIC copies of both members.

Business Accounts
When the owner of the firm operating singly, open an in his term name.

Sole Proprietor Account

This account is for those person who has his own business and he must be the
solely owner of the business.
Requirements

Companies stamp
Declaration of proportion companies letterhead.
Sign on AOF.
NIC copy
Verified signature of introducer.
Sole proprietorship declaration

Partnership Account
Account title will be the name of the partnership firm.
Requirements

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Sign of customers on back of AOF.

NIC copies of partners
Partnership deed (certified copy) duly attested by notary republic.
Partnership mandate (prescribed format)
Companies rubber stamp

The A/C is opened in the firm name and all partners designate one or two persons to act
behalf of the partnership firm all acts of the firm jointly and severely.
Limited Company

Private Limited
Public Limited

Private Limited Requirements

Restrain on companies letterhead dully attested by chairman.

Sing of all directors on back of AOF.
NIC copies of all directors.
List of directors on companies letterhead.
List of memorandum and article of association.
Copy of board resolution.
Latest form 29 (if director is to be changed or in case of his death, this kind of
form is filled, it includes information that a new director has how much number of

shares with him.

Companys rubber stamp.
Director should attest copy of certificate of incorporation; co register an office
stamp should be affix.

Public Limited Requirements

Certificate of commencement of business

Same as home documents.
Club / Society / Association
These concerns are non-trading in nature. They have their own rules and
regulation and their affairs are mentioned by the committee called as a governing

body or managing committee.

Stamp of directors
NIC copies
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Certified copy of resolution

Memorandum and article of association
List of heads on companies letterhead.
Bank account opened in their name with BAL.
Name of person to be specified for the operation in account.
The manner in which the account shall be operated.
Letter of registration.

2.1.6.4 Cheque Book Issuance

When the account is opened, then the customer is given a cheque book to sign
upon and to cash money. It proceeded as under.
Procedure
All the account opening formalities must be completed before issuance of cheque
book. Particulars of the cheque book requisition should be completed containing title of
account, account number, type of currency, number of leaves and signature to the
customer. Signatures of the customer are verified on the requisition.
If customer is unable to collect his cheque book, then he can give authority to the
third person to collect his cheque book on his behalf by signing on the back of the
requisition, in such case, the particulars of the third person are required like name of the
person NIC number and signature of that person on requisition and cheque book issuance
register. Cheque book is taken out from the safe / locker. It is assured that series of the
cheque book. Particulars are entered in the cheque book issuance register. Account
number is stamped on very leave of the cheque book and those leaves are counted. Name
of account holder is written on the cover of the cheque book. And requisition on the
cheque book for further issuance is properly filled, stamped and signed by officer of the
bank. Cheque book is delivered to the customer and his signature on the cheque book
issuance register. Cheque book serial number entered.
Bank Alfalah issues the following cheque books.

Saving account-25 leaves

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Current account 50 to 100 leaves

Foreign currency 10 leaves

Loose cheque is also issued in some cases. Number of leaves can be increased on the
request up to 100 leaves.

2.1.6.5 Closing of Account

When a customer wants to close an account he has to given a hand written
application to the head of the operations department to close his account plus remaining
leaves of cheque book. The manager first verifies the sign of account holder, and then
closing is done from the registers on the computer where the account was opened. In the
file of the account holder his account opening form is crossed. For this closing a fee of
Rs. 200/- is charge in BAF.
2.1.6.6 Clearing Department
Before discussing it is necessary to know what is clearing. The process by which
cheque exchanged between the collecting and paying bank and the ensuing financial
settlement is called clearing. This facility is provided by the state bank of Pakistan for
offsetting of cross obligations between the different banks. Clearing is of two types.

Inward clearing
Outward clearing

Inward Clearing
Inward clearing cheques are the cheques drawn by the bank/branch customers on
their account in favour of other parties.
Outward Clearing

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When a particular branch receives instruments drawn on the other bank within the
clearing zone and sends those instruments for collection through the clearing arrangement
(NIFT) is considered as Outward Clearing for that particular branch.

2.1.6.7 Remittance Department

The need of remittance is commonly felt in todays business. A major function of any
bank is to transfer of funds from one place to another. Bank Alfalah uses the following
modes of transfer of funds.

Demand draft (DD)

Pay order (PO)
Call deposits

It is instrument, which is used to transfer amount from one city to another city it can
be made on cash as well as on cheque. If it is made through cheque that it is necessary
that person must be A/c account holder while in case of cash any person can make. The
demand draft is secured mode of payment. It consists of three copies.

Original copy, which is given to account holder.

DD advice is sent to the central branch.
Third copy is for reconciliation. Its photocopy is kept with us (bank) while
original is sent to head office for reconciliation.

Procedure
The client who wants to transfer his funds form one city to another fills a form
requesting the bank to prepare a DD. DD application form contains columns requiring
information for the preparations of DD e.g.

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Beneficiary name
Applicants name
Address
Amount to be sent etc.

Bank deducts some charges against DD. These charges include commission tax
provincial tax etc. Tax is deducted 0.3% while PT charges are 0.50 paisa. If customer is
taxpayer than advance tax is exempt provided that he submits the tax exemption
certificate.

Procedure for Foreign Demand Draft Issuance

Application form is given to the customer to fill the same. Two signatures are
taken on the form, one for request and other for receiving the instrument. All the
particulars of application form are checked and bank commission is charged, which is
US$ 5/- for each amount of FDD. Cheque is received from the customer for total amount
of FDD plus bank commission. Cheque and application form is then given to the officer
cash department for the payment cheque.
After proper scrutiny, officer cash department posts the cheque and signs the
application form, to assure that payment is received. Then cheque and application form is
given to the Incharge. Remittances, who will enter all the particulars of the application in
the FDD issuance register. If the customer wants to pay cash, the customer on cash
counter deposits it. Cash receiving officer receives cash on the application form along
with the bank charges. Application form is then given to the remittances in charge for the
issuance of the instrument. A control number is allotted to the instrument form FD
registers. Instrument is complete by putting all the particulars in it and signed by two
attorney holders. Instruments are then handed over to the customers. FDD advice is sent
to the responding foreign bank / paying bank where they are maintaining dollar account
through registered mail. Exchange transaction credit advice (ETCA) is sent to eh Head
office fore the reimbursement. Copies of the FDD and ETCA are kept in the record of the
bank.
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Collection
All the cheques under collection are called cheques under collection in Bank Alfalah
Limited. There are two types of bills for collection:

Outward Bills for Collection

Inward Bills for Collection

Outwards Bills for Collection (OBC)

All the cheques are received on one counter along with paying slips duly filled in
properly containing particulars of cheques and account holder. Counter folio of paying
slip is handed over to ht customer by putting stamp for cheque received for collection
for Bank Alfalah on it duly signed by officer. These cheques are scrutinized and cheques
for local clearing are separated from OBCs. Cheques for local clearing are entered in
clearing register, whereas cheques for collection are entered in OBC register and handed
over to the bills department for collection. OBC number is allotted to the cheque from
OBC register. Special crossing and bank endorsement stamps are affixed on the cheque.
OBC schedule is attached with the cheque and dispatched to the main branch of that city
for collection. If they do not have any branch in that city, then cheque will be sent to the
collecting agent of Bank Alfalah for then cheque can be sent directly to the drawing
branch, instructions are given on the OBC schedule for the payment of that cheque.
Inward Bills for Collection
If any other bank sends a cheque of bank Alfalah limited, it is inward bill for
recollection. Bank Alfalah remits money after checking the balance of the customer
account. The process collection starts when the cheques of bank Alfalah ltd are received
from other banks. Then these cheques are sent to the head office Karachi, which sends the
cheques to SBP for clearing and get the confirmation of cheque and credit advice. Main
activity of clearing is performed by head office, which contacts other banks through SBP
Pay Order

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Written order which is issued and received to the save book or drawn or payable
on same branch. Application form is given to the customer to fill. Two signatures are
taken on the form one for request and other for receiving the instrument. All the
particulars of application form are checked and bank commission charges and with
holding tax are written on the top of the applicant form. If the customer is maintaining his
account with the branch he can give cheque for total amount of instrument plus bank
charges. Cheque and application form is then given to the officer cash department for the
payment post the cheque and signs the application form in token of payment received. If
the customer wants to pay cash, cash is deposited by the customer on cash counter cash
receiving officer receives, cash on the application form along with the bank charges and
withholding tax.
Call Deposit
When the party wants to give payment from itself to another party then it makes
call deposit. The bank keeps it with itself unless it does not receive instructions from
other bank. Normally it is made on cash and goes in party account.
2.1.7 COMPARISON BETWEEN THEORY & PRACTICES
There is a huge difference between theory & practices when I start my internship
then with starting work I observed that its like totally different things I felt that I have
learned just types of different things & when I performed procedures for everything that
is different so there should be some practical exercises included in the course works so
students may have a closer look in practices before going into practical life.

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CHAPTER III
INTERNSHIP ASSESMENT & RECOMMENDATIONS
3.1 MAJOR RESPONSIBILITIES UNDERTAKEN DURING INTERNSHIP

Filling account opening forms

Filling different documents at the time of opening account
Filling deposit slips
Maintain record of all the ATMs and Cheque Book received
Maintaining record of all Inward and Outward Mails in register
Checking the vouchers
Guide customers for their concerns about remittance
I guided many customers for filling account opening form

3.2 SKILLS & QUALIFICATION ACQUIRED FOR INTERNSHIP

He / She should be a Graduate

No Age limit
Not be a Minor Person
Sound Mind
Confident & Punctual

3.3 IMPACT OF INTERNSHIP ON FUTURE CAREER PATH

As you prepare for your future career, there are many things you can do to set
yourself up for success earn good grades, get involved and most importantly, find an
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internship. There are many huge benefits to taking on an internship during college and/or
post-college. Here are some to keep in mind:
Growing Your Network Networking is still king in the job search, and internships
give you exposure to professionals who can speak to your skills and you can add to your
growing network. You never know, your hard work could impress your supervisor
enough to recommend you for an open opportunity either within the organization or
another organization.
Resume Experience and Interview Talking Points In todays job market, entrylevel no longer means you dont need to have experience. In fact, if you want a chance at
standing out from the crowd, you absolutely need to have an internship or two under your
belt. Having internship experience on your resume will help better qualify you for a
position, catch a hiring managers eye and give you substantial things to talk about during
your interview.
Many industries have different career paths you can choose to go down. Sure, you
can learn about your different options, but how will you know what is best for you?
Internships give you the freedom to try different career paths without being completely
tied to them for an extended period of time. This is invaluable for every professional,
learning about future options and searching for his/her dream job. Arming yourself with
internship experience can make a ton of difference not only in your job search, but your
future career.
3.4 GENERAL OBSERVATIONS ABOUT THE BANK
I observed the bank Alfalah a financially sound bank. Its profits are increasingly
year-by-year. Its staff is very good and sincere with the bank. Bank Alfalah under the
leadership of Sheik Nahayan Mabarak Al-Nahayan has made significant progress in
building and strengthening both the corporate and retail banking sectors in Pakistan. The
bank attained number 2 positions in terms of its balance sheet size amongst the private
banks in Pakistan in 2000.

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Bank Alfalah views specialization and service excellence as the cornerstone of its
strategy. The people at bank realize that innovation; creativity, reliability, customized,
services and their execution are they key ingredients for their future growth. Revenues
from these activities have started yielding dividends and they expect significant growth.
They are aware that they have stepped into the 21st century and they must meet its
challenges by acquiring the highest level of the technology. They will thus be
accelerating their technological advance to enable them to distribute their products and
services through most efficient and high tech means. They say that they will continue to
invest in the modern tools and substantial allocation to resources will be made to achieve
this objective during the current year. Online banking have been started and the
introduction of ATM at strategic locations have been firmed up and it will be fully
operations during the June 2001.
3.5 RECOMMENDATIONS FOR BANK ALFALAH
1. This is a routine practice that in order to give personalized services to the
customer, bank staff tries to fill all the columns of AOF with their own
handwriting, which is wrong. AOF must be filled in by the customers. Bankers
should avoid filling in the AOF because it can create problem if the address, title
of account or any other information provided by the customer has not been
written properly. Customer may be affected or he may claim that this information
was not provided by him, but if AOF is filled by the customer then banker cannot
be held responsible for any incorrect information provided by the customer.
2. Cheque book should not given to the customer if the account formalities are
incomplete.
3. Audit should be held internally. Rather there should be an Audit Department in
the branch to make audit on daily basis. This can become as helpful as different
banks are having this department of their own.
4. The internal computer system is quite slow and often gets hanged up. Most of the
time system gets offline from the head office and customers have to wait in
queues. So they should properly check it.

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5. Bank Alfalahs employees are not getting raise in their salaries, bonus or other
financial benefits .
6. The top management and the Board of Directors must find a solution towards this
problem. Because if this continues it will cause dissatisfaction among the
employees. They will either leave the organization or will not work with the same
level of commitment. Bank Alfalah is in no position to face this loss. The top
management has to find ways to solve this problem soon and at the same time
what they can do is take some load off the employees temporality so that they
dont get over stressed.
7. Another technological problem is related to ATM machines. Most of the time
customers come into the branch and complaint about ATM machines. They
should fix the problem.
8. The bank has to increase its advertising of products and services.
3.6 RECOMMENDATIONS FOR COLLEGE
PGC should start some practical exercise in the college premises like class
activities specially planned for banking processes
Many internees dont learn anything because they have not good options of a
good bank so college should seriously take steps to check & balance on this may be it
possible by weekly interviews by students so college may get know that students are
learning & working in real times or not.
3.7 RECOMMENDATIONS FOR FUTURE INTERNS

Internship is a training activity so first of all I would say that an internee

should take it serous like his or her own job.

An internee should adopt professionalism there.
He or she should behave their like a real professional employee ready to learn

and perform every activity which managers direct.

Show your passion to learn and curiosity in everything, every document,

every activity you see and observe.

An internee should spent full working hours at the respective organization

trying to learn all work done from start of the day till end.
Should show responsibility in every task assigned by any manager or
particular employee.
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REFERENCES

Annual Report of Bank Alfalah Limited 2014,2013

Annual Report of Bank Alfalah Limited 2012,2011
www.bankalfalah.com

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