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Prepared by:
Class: B. Com
Session: 2016-2018
DEPARTMENT OF COMMERCE
It is certified that the Internship Report has been successful completed by the students
under my supervision. It is also certified that the Report meets all criteria and standards laid
Class: B. Com.
Session: 2016-2018
Signature:
Date:
DEDICATED TO
I am very thankful to Allah Al-Mighty for enabling me to carry out this successful report and
also to Faculty of Institute, who has aided me and given me enough skill and knowledge to
reach this level of being able to write my own project.
This report is basically on the observation and practical vision, which I have experienced during
my internship in the Bank Alfalah Limited. It was a very good experience. It was a great chance
for me to see the application of theoretical concepts, which I learnt through books and my
teachers. During training, many times I faced great difficulties to understand the new terms on
the relevant subjects but with the grace of God I applied my full knowledge, which I had
obtained from my teachers and thus became able to understand the function of the whole
institution successfully. The cooperation of the concerned staff of the Bank Alfalah Limited of
Pakistan with the internees was very appreciable. However, while preparing this report I have
avoided using the technical terms, which are not understandable for a layman, and the efforts
Wajid Ali
Executive summary
I was lucky enough to avail this chance of doing an internship at Bank Alfalah Ltd D- Ground
branch. This duration of internship was 2 months. During the training I was introduced to the
functioning of different departments operating in the branch. This report discusses the overview
of my internship organization. It illustrates the history of Bank Alfalah, detailed information
about the bank's accounts, clearing department, remittances etc. It contains the information that I
was able to gather and understand regarding the activities of the bank.
I have discussed all the departments and learning that I have got there. During this internship I
got a chance to get an idea about the practical working of different departments. In account
opening department I have learnt about the different types of accounts as well as account opening
procedure. In clearing department I got the knowledge about different types of clearing. In
remittance department I learned about different types of remittance.
I apply the class room learning in bank which shows the application of bookish concept in
practical work. I have also identified the problems that are faced by the branch. Then I have
given some suggestion and recommendations to improve the overall working of the bank. This
report is prepared in simple and understandable format so, that ordinary person can also take
benefit from this report. This report will provide a better and brief learning about Bank Alfalah
Limited.
Table of Contents
Bank Alfalah Limited is a private bank in Pakistan owned by the Abu Dhabi Group. Bank
Alfalah is the 5th largest bank of Pakistan with 648 branches in Pakistan with an international
presence in Afghanistan, Bangladesh, Bahrain and a representative office in the UAE.
Bank Alfalah was incorporated on June 21, 1997 as a public limited company under the
Companies Ordinance 1984. Its banking operations commenced from November 1, 1997. The
bank is engaged in commercial banking and related services as defined in the Banking companies
ordinance, 1962.
History
Bank Alfalah Limited was launched on June 21, 1997 as a public limited company under the
Companies Ordinance 1984. The bank commenced its operations on November 1, 1997. The
bank introduced commercial banking and related services as defined in the Banking companies
ordinance, 1962. The Bank is owned and operated by the Abu Dhabi Group. The International
Finance Corporation (IFC) of the World Bank partnered with the Bank in 2014, and holds a 15
percent stake in Bank Alfalah.
The Bank provides financial solutions to consumers, corporations, institutions and governments
through a broad spectrum of products and services, including corporate and investment banking,
consumer banking and credit, securities brokerage, commercial, SME, agri-finance, Islamic and
asset financing.
The roots of the bank go back to the Bank of Credit and Commerce International (BCCI), which
was taken over by State Bank of Pakistan and nationalized to safeguard the consumer interests,
under a new identity of HCEB or 'Habib Credit and Exchange Bank'. In 1997, the bank was
privatized and taken over by 'Abu Dhabi Group' of UAE, with a new identity of 'Bank Alfalah
Limited'. The management of the bank had implemented strategies and policies so the bank
would become a major player in the market. With a partnership with the Abu Dhabi Group the
position of the bank became stronger which allowed the bank to invest more in technology to
increase its range of products and services
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Type Private
(Chairman)
Website www.bankalfalah.com
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Chairman’s Message
Starting off with just a handful of branches in 1997, today Bank Alfalah operates steadfastly with
a vast footprint in order to provide creative, customized financial solutions to over 1 million
consumers, corporations, institutions and governments. Our top most priority is to meet the
changing financial needs of our diverse range of customers – our service philosophy entails the
fact that our success will follow if our clients are served well. We remain committed to this goal
and hence continually seek to introduce customized financial solutions in Pakistan and beyond.
I am confident that Bank Alfalah will remain at the forefront of the evolving financial services
landscape in Pakistan in order to serve our clients even better. With the support of all our
stakeholders, we hope to promote a workplace environment where we take responsibility for our
actions and promote respect, inclusiveness and uncompromised integrity – most importantly,
create a Company which can survive through good times and bad.
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Vision Statement of Bank Alfalah
“To inspire and empower people to do things differently, and shape their own
path in life and business”.
Mission statement
We look at the market with fresh eyes to find new opportunities, seek new ways
of enabling our customers to succeed and advance the world of finance
Values
We always put the customer and their needs front and Centre.
We do all we can to understand and anticipate what will help our customers find
their own way and achieve their ambitions.
We do things differently, challenging the status quo to find new and better ways to
move ourselves and our customers forward.
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Objectives
The Bank’s Balance Sheet indicated a growth of 21 percent, with total assets reported at Rs.
902,608 million at year end 2015. The Bank’s profit before taxation for the year increased by 48
percent to Rs. 12,604 million as compared to Rs. 8,514 million last year. The Bank has solidified
its position by actively building a portfolio of high yielding assets, as is evident from the growth
in the balance sheet, while maintaining core deposits and careful monitoring of its borrowing
position. Basic earnings per share were reported at Rs. 4.73. The Bank managed to increase its
deposit base by 6 percent to Rs. 640,189 million. Net Advances have grown by
13 percent to Rs. 327,298 million at 31 December 2015 as compared to Rs. 290,597 million
recorded at last year end. At the year end, our Gross advances to deposits ratio stands at 54
percent. Net Investments level has increased by 22 percent to Rs. 397,097 million.
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Financial Highlights
Bank Alfalah has grown 51.84% in its total assets and 101.35% in its equity. The Bank netted
record pretax profit of Rs. 3.506 billion, a 291.85% increase over the corresponding period last
year (2004), which includes capital gains on Federal Government securities of Rs. 2.19 billion.
The deposits of the Bank rose to Rs. 76.7 billion which is 48.4% higher than corresponding
period last year (2004) and indicative of increasing customers’ confidence in your Bank, because
of its superior services and healthy practices.
The Loans and Advances figure stood at Rs. 50.37 billion, an increase of approximately 71%
over the last financial year (2004). This portfolio has been supplemented keeping the Bank’s
stringent and prudent policies in view.
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Branches Network
The network of bank Alfalah consists of 101 branches all the country-wide Details:
Karachi 18
Lahore 13
Peshawar 2
Rawalpindi 2
Faisalabad 2
Multan 5
Bhawalpur 1
Gujranwala 1
Gujrat 1
Hyderabad 1
Islamabad 1
Jehlum 1
Mardan 1
Mianchannu 1
Mengora (Sawat) 1
Quetta 1
Rahim Yar Khan 1
Sahiwal 1
Sargodha 1
Sheikhupura 1
Sialkot 1
Sakhar 1
Wah Cantt. 1
Gawader 1
Dera Ghazi Khan 1
Page8
Credit Portfolio
A depressive interest rate environment has spurred the competition for scarce banking assets in
local financial industry. While Bank Alfalah remains a key player in the market, however, it
treads with caution so that the quality of its credit portfolio is not compromised.
The Bank has employed a proactive approach in the form of a well-designed and transparent
credit approval process. This process benefits from an inherent system of checks and balances at
each level.
Bank Alfalah offers high quality service to its foreign trade clients. Customers are assured of
efficiency and timeliness when dealing with their overseas counterparts. Our clients enjoy the
benefit of our well integrated global correspondent-banking network giving them greater global
reach. This comprises more than 200 financial institutions all over the world signifying the
favorable reputation that Bank Alfalah enjoys globally as a stable and responsible banking
institution.
During the year, the foreign trade volume of the Bank has recorded an impressive growth and it
has reached to the level of 8% of total foreign trade of the country. The imports figure of Rs.
46.81 billion and exports figure of Rs. 44.27 billion represented an increase of 38% and 34%
respectively over the last year figures.
The Bank has also been fairly active in the inter-bank market and enjoyed substantial lines of
credit. The Treasury Division added significant profitability to the Bank through its intuitively
priced transactions and proactive strategies for both investment and realization of capital gains.
Page9
Credit Rating
Despite the political and economic uncertainties, Bank Alfalah was able to maintain its
impressive credit ratings of AA- and A1+ in the long and short term respectively. These ratings
are indicative of a very high credit quality and low potential for credit risk. These ratings have
been assigned by the PACRA, the leading credit rating agency of Pakistan. These ratings have
been awarded on the basis of a steady improvement in organizational performance, augmentation
in equity base and increased sponsor backing.
Development of professional skills and knowledge of the employees is essential for the efficient
functioning of any organization. At Bank Alfalah appropriately designed policies and practices
have been instituted to achieve this strategic objective.
Philosophy
Excellence in service
Quality performance
Product innovations
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Core Values
“Our support always remains at the forefront – from rehabilitation and conservation of historical
buildings and from education to sports. We, as corporate citizens, are involved in social uplift,
welfare, culture and sporting activities across the country”.
Alfalah’s Auditing
The auditing procedures are used to check and verify performances and targets of all the staff, at
branch level, at higher level, and also to see the target levels and benchmarks that we are
supposed to achieve from our sales etc because of our customers. We use them for compliance
and verification. They are used especially for risk management. The procedures are set keeping
in mind the SBP regulations. But the proper auditing we carry out is through budgeting, through
the budgets we check how we are performing especially from top down level.
Key Initiatives
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Financial Statements
Page12
Page13
Bank’s Performance
The Bank’s performance for 2017 remained impressive as we closed the year delivering sound
financial results. The margins of the banking sector continued to remain under pressure all
through the year owing to the consistently low interest rate regime.
Amidst this backdrop, the Bank’s Net Interest Margins have indicated an improvement year on
year, which reflects on a well thought out, focused and prudent ALM strategy.
Financial Position
*Current year figures do not include one overseas set up (held for sale) whereas prior year figures include the same.
Page14
Financial Performance
Page15
Page16
Financial Statement
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Products and services of Bank Alfalah
Credit ratings
PACRA, a premier rating agency of the country, has rated the Bank ‘AA’ (double
A) Entity Rating for the Long-term and A1+ (A one plus) for the Short-term, and the Outlook
for the Bank as per the latest rating report has been improved to Positive from Stable previously.
These ratings denote a very low expectation of credit risk, strong capacity for timely payment of
financial commitments in the long term and the highest capacity for timely repayment in the
short term, respectively. The unsecured subordinated debt (Term Finance Certificates) of the
Bank has been awarded a credit rating of AA- (double A minus).
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Features
Bank Alfalah Limited is an established bank. It has some special features with the help of those it
is growing rapidly.
As the work environment plays a great role in this competition age, so the bank has good work
environment. All the people work with cooperation; managers are so kind that each problem can
be discussed with them.
EFFICIENCY
Employees at Bank Alfalah are quite efficient. They work more than their working hours and it
is all according to their will. It also shows their loyalty, commitment to organization.
CUSTOMER SERVICES
All the customers are entertained individually. Same kind of behavior and attention is given to all
the customers.
Getting ideas for improvement from customer side is a new idea and that is working very well in
Bank Alfalah Ltd. All the customers are asked to fill a suggestion form and the standards of the
bank are improved through them.
EMPLOYEE BENEFITS
Employees are given the benefits like bonus, gratuity funds, loans, increments, house rent,
medical and conveyance allowances.
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COMPUTERIZED WORKING ENVIRONMENT
In bank, all the work is done remotely. All the entries are made using the systems which are
internally and externally integrated. This increases efficiency of the bank.
ATM
Bank Alfalah through its commitment to provide superior and improved services to its valued
customers, has unveiled a nationwide network of ATMs. For customer convenience, customers
now have access to instantaneous cash availability, 24 hours a day, 7 days a week.
ATM network is geared up to exploit the latest technology, and is equipped to meet the highest
standards of security and efficiency. With new ATM card you can now:
Withdraw Cash
Use our convenient, user-friendly fast cash option
Make a Balance Inquiry.
Get an instant printout of your account balances
Get a printout of your last transactions (Mini-statement) on the spot.
Change your PIN (Personal Identification Number).
Bank Alfalah is pleased to introduce 27 state of the art ATMs, deployed at the most convenient
and accessible locations. Bank Alfalah is a founder member of the 1-Link Switch, thus making a
countrywide network of ATMs available.
An extensive network of quality agents, linked by computer, will transfer your money safely and
ensure that it is handled with care and without delay. Thousands of people already use the
MoneyGram service all over the world. It is trusted for its reliability and security.
MoneyGram is available in over 154 countries and in more than 40,000 locations worldwide.
With Money Gram your money is transferred immediately and usually arrives at the receiving
Page29
end within 10 minutes while other services can take days or weeks. There are no complicated
procedures and you do not need a bank account or a credit card.
There is also an added personal touch-you can receive a 10 word message from the sender with
every transaction at no extra cost.
CREDIT CARDS
Bank Alfalah Visa Credit Card was launched in Pakistan in February 2003 and is now the market
leader. Visa Debit cards, satisfying a much larger customer base in comparison to any other
issuer in Pakistan. With an extensive network of above 200 branches in all major cities, Bank
Alfalah has catered to a huge untapped potential market and the product positioning of “FREE
FOREVER” ensures no annual fee to be charged to the cardholder forever. Numerous facilities
are being offered on their cards including 24 hours utility bills payments, exciting Rewards
program, Platinum cards for high net worth customers, SMS Alerts facility for each transaction,
payment or any other activity on credit cards and unique Insurance Plans for Children Education
and Life Insurance. An instant installment plan is also incorporated in the acquiring business,
whereby Bank Alfalah cardholders can convert any transaction conducted at Bank Alfalah
merchants to easy installments of 3 to 36 months at the time of transaction. Recently the cards
business has also been expanded to Afghanistan being the first issuer there and this trend of
expansion to other countries will continue in many countries to make Bank Alfalah the first
Pakistani bank to issue cards worldwide.
Bank Alfalah Limited offering credit cards with minimum markup and in wide variety in market.
Markup rate that is charge is 2.50% after the 51 days of transaction. Bank Alfalah offering
various varieties of cards:
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Balance transfer facility-Smart settlements
Offering an easy and convenient way to settle unsettled credit card payments on all existing
credit cards in Pakistan. Avail this facility at as low as 1.5%.
Now you can avail cash advance facility up to 75% of your available credit limit. Enjoy the
benefits of this exclusive offer on your Bank Alfalah credit card.
Now you can convert any transaction, amount of Rs. 3000 and above to a step-by-step monthly
installment payment plan. It gives you the flexibility to convert your large payments into small
equal monthly installments.
Offering the facility to acquire free supplementary cards for your family members. Avail this
card without any extra cost.
Fortunes
Offering an amazing rewards program that let you earn points every time you use Alfalah Visa
card. Redeem the earned points anytime for fabulous gifts of your choice.
Discounts
Offering discounts at wide range of outlets, selected especially to much your taste. You can avail
matchless discounts each time you charge your card at these outlets.
Insurance Cover
Offering card members a range of features design to protect you and your family from the
setbacks of life, at very affordable rates.
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Bank Alfalah UNIQUE BENEFITS
This facility is specially designed for Bank Alfalah account holders. It gives the option of
making minimum or full payments through Bank Alfalah Savings / Current Pak Rupee account
specified on Alfalah VISA monthly statement.
Alfalah VISA offers card members a new and powerful protection against the uncertainties of
life. In the unfortunate even of prolonged illness, disability or death, it’s reassuring to know that
with Alfalah Credit Cover you have no cause to worry about your monthly credit card
repayments. Alfalah Credit Cover has a range of features designed to protect you and your
family from the setbacks of life, at rates that are affordable.
DOCUMENTS REQUIRED
Eligibility Criteria
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For Self Employed Applicants
Additional Requirements
Partnership deed & personal account statements of partners (if any) for last six months.
Bank letters / certificate confirming Proprietorship (in case of Proprietorship).
Memorandum / Articles of Association / Form A (in case of private limited company).
Recognized professional degree / membership certificate to professional associations (in
case of professionals).
ALFALAH CAR
It’s a scheme that enables one to own his desired car at easily affordable and flexible installments
with a minimum down payment and insurance.
Quickest processing
No hidden charges
Minimum down payment
Complete repayment at any point of time
Balance transfer facility {BTF} for existing as well as new clients from other Banks
Tenor period ranging from 1 to 5 years.
Financing of all brand new locally assembled vehicles.
Financing limit ranging b/w Rs. 200,000/- to Rs. 2000,000/-
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CORPORATE & INDIVIDUAL CAR LEASING
We commenced car financing in the year July 2000 We feel immense pride that our car financing
has redefined operating standards. This certainly reaffirms our stance on giving clients maximum
value for their money. Considering this product as the most lucrative mode of lending, and in
view of its feasibility in the near future, BAL offers the most competitive mark- up rates in the
market and provides a chance to the innumerable customers to make their dreams materialized
through buying of their desired vehicles. The product has facilitated in creating strong brand
recognition for BAL in the market. Car Financing has not only become a star product of BAL,
but has also provided an impetus for successful launch of other consumer products.
BAL is offering financing facility not only for the brand new vehicles but also caters to those
customers who wish to opt for used vehicles. Quick processing and turnaround time, competitive
mark up rates; affordable installment plans are the key features of the product. When BAL
entered the arena of Car Financing, there were only a few players (including the leasing
companies and banks).With growing consumer awareness and declining interest rate scenario,
several banks entered this nascent area. This scenario gave substantial boost to the overall car
sales, which in turn proved to be highly beneficial to the local car manufacturers. Car Financing,
on the one hand provided an opportunity for the financing institutions to increase their spreads,
while on the other hand facilitated in expanding their consumer base with small per client
exposure. The increasing competition demanded constant increase in the distribution channels, as
well as the work force, coupled with offering market driven interest rates for this product. Today
as we look back towards the milestones achieved, we are filled with immense satisfaction, to
have come such a long way since inception of the car finance business. With the expansion of
BAL branches in all big and small cities of Pakistan, the product portfolio has reciprocally
expanded in response to our client’s needs. The bank aims to invariably improve its existing
standards by adopting innovative measures and exploring new perspectives for both products and
customer care. This customer focused banking strategy has enabled Bank Alfalah to evolve as a
single source financial service provider of Corporate and retail banking services.
BAL car comprises a dedicated team of professionals, equipped with sound business acumen and
diversified experiences in their respective fields of operations. Our notion is to serve the quality
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through customized and comprehensive offers for our customers. We have offered a wide range
of banking products which are strategically planned and designed to suit our customer’s needs.
This notion has given us strength to face the future challenges. The array of products continues
to satisfy the banking requirements of our customers. BAL is well positioned to capture
impending opportunities for growth. BAL’s intellectual leadership and outstanding management
values have given its marketing team a good momentum to perform. We are confident of our
untiring abilities to continue delivering profitable growth. With a focused and efficient platform
we expect nothing less of ourselves and offer nothing less to our clients.
Now you are provided with the option of either to get the vehicle leased or financed.
INSURANCE
Renowned and reliable Insurance companies are offering the competitive rates of Insurance. Pay
year insurance premium in advance (at the time of down payment) and remaining in the
subsequent equal monthly installment.
Offering lowest rate of markup of 12, 12.5%, {per annum}, BAL has captivated a major market
share and so is the plan for future.
REPAYMENTS
Easily affordable installments on monthly basis in the form of postdated cheques will set you
free of depositing your rental cheques every month.
SECURITY
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YOU CAN ACT AS A CO BORROWER
Acting as a co borrower, will enables your family members {spouse, children- 18 year and
above} to avail the financing facility and can get the car registered in their names as well.
ELIGIBILITY CRITERIA
Yes you get a car loan form bank Alfalah to purchase a brand new car if you are:
Pakistani National Identity Card holder.
Over 20 years of age (Maximum 60 years in case of salaried and 62 in case of a
business person at the time of maturity of the loan).
Salaried, Businessman or self employed.
Application form
Copy of national Identity card
Copy of Driving License (optional)
N.T.N. Certificate
Copy of current utilities bill of residence
Bank account statement for last six months from the date of application
Signature verification fro duly verified by t he banker
An Assets & liabilities statement (where bank‘s financing exceeds Rs. 5 Lac.)
CIB report required (where bank‘s financing exceeds Rs. 5 Lac.)
Basic Borrower Fact Sheet
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Additional requirement for self employed professionals
Certificate from employer showing permanent employment for the last 2 years
Original salary certificate
Take home salary three times of proposed installment
Income of spouse can also be clubbed
If leasing Auto then the Asset will be on the bank name for minimum 2 years and if Financing
Auto or home it will be the honor’s name. Things which are required for car financing:-
If a person is a businessman then his/her visiting card or company letter head is required.
If salaried person needs a car, then his/her certificate of employer is required and his/her
salary slips. When the bank gives the car to their customers, then they take cheque from
them which are known as posted cheque, cheque should be present on every 5th of every
month. Car will not be given to a person who is at the age of sixty. It can be on his son’s
name.
Cheque returned or rejected auto Rs.500/- pay service charges.
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Penalty on late payment Rs.100 per day or maximum of Rs.1,000 per month installment.
Posted Cheque
If the time period of a car is three years which means 12 x 3. It means the customer will
present 36 cheques.
State bank has given this access to all the banks and they know that the customer had
taken a loan from any other bank or not and this access software is known as ECIB
(Electronic Credit Information Beauro). From this software every bank can cheque the
financial status of every customer.
HOME FINANCING
The Bank Alfalah Home Finance product continues to be the market leader in Pakistan, having
the largest disbursed and outstanding portfolio among all the commercial banks operating in
Pakistan. At present BAL Home Finance product offers the following five (5) variants to its
customers:
Home Buyer (for purchase of already constructed Bungalow/ Apartment/ Town House
etc.)
Home Construct (for construction of Bungalow/Town House etc, and for purchase of a
residential plot for subsequent construction.)
Home Improver (renovation/improvement of existing property)
Home Balance Transfer Facility (transfer of existing financing availed from other banks
to BAL)
Home Start (purchase of an already constructed financing unit with a moratorium of up
to 3 years in principal payments). This is principally aimed at young professionals.
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Our growth is steady, and in line with the market trend, which is that of caution in lending to
customers with even a slightly reduced repayment capacity. However, the focus has increased on
attracting overseas expatriates as our customers, with very good results.
During the last quarter BAL kept its position as a major mortgage financier, in spite of
aggressive competitive posturing by other major banks. Home Finance facility is being provided
to the customers in 16 cities viz Karachi, Lahore, Rawalpindi/Islamabad, Faisalabad, Multan,
Peshawar, Sargodha, Gujranwala, Sialkot, Quetta, Hyderabad, Bahawalpur, Abbottabad, Wah
Cantt, & Rahim Yar Khan etc.
Bank Alfalah has deployed all available resources to ensure that its portfolio remains adequately
protected from sudden reversals. With restrictions on upper cap gone, Bank Alfalah has already
started booking large ticket loans besides ensuring proper measures in place to counter changing
conditions.
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If you require a financing of at least Rs: 500,000/- or more (maximum
Rs: 7,500,000/-)
If you have been a Bank Alfalah borrower for past one year with clean
payment record.
You may apply for Bank Alfalah’s Home Finance for minimum period of 3 years and a
maximum period of 20 years (subject to your age).
DOCUMENTS CHECKLIST
The following documents are required to be submitted by an applicant with the completed
application.
Copy of NIC.
Copies of last Salary / Pay Slip duly attested by the HR department.
Salary Certificate (original) from the employer, showing the gross salary and deductions.
Employment verification form from the employer.
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Analysis of Departments
MARKETING DEPARTMENT
Location survey
Merchant profile
Relationship with other banks
Installation of POS at different merchant locations.
FINANCE DEPARTMENT
This department includes settlement of all payments relating to cardholders, Merchants, Treasury
department, Reconciliation settlements and preparation of financial accounts. There are three
sections under finance department:
This includes dealing with vendor payments, bills paid by cardholders, cash withdrawal of
cardholders and salary payments.
Settlements
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This includes General Ledger and all debit and credit charges to cardholders.
Reconciliation/ Rectification
IT DEPARTMENT
This department includes credit card software support and maintenance, in-house programming
and development and in-house technical support.
OPERATIONS DEPARTMENT
CASH DEPARTMENT
Receipts:
In this, the depositor’s slip is credited and posted in the concerned accounts.
Payments:
In this the cheque is handed over to the cash payment officer for payment.
CLEARING DEPARTMENT
Inward Clearing:
This includes the cheques to be honored by bank. The SBP clears the cheque draft.
Outward Clearing:In this the cheque of other banks sends for the collection.
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ACCOUNTS DEPARTMENT
This department is concerned with revenues, expenses, assets and liabilities. In this all the
vouchers posted during the same day are sent to the accounts department the next day.
REMITTANCE DEPARTMENT
Bank Alfalah uses several modes for transfer of funds. These are Demand Draft, Telegraphic
Transfer, Pay order, Call Deposit, Pay slip, Money gram.
CREDIT DEPARTMENT
This includes credit marketing department, credit administration department, and trade finance
service department. The department deals with extending the loans under the SBP regulations.
Credit risk management involves new accounts, customer reassessment unit, verifications,
collections and recovery. This includes area wise verification and also physical certification,
legal notices and suits.
In case of vehicle, a due date diary is to maintained for lodgment of PDCs. If any cheque is
returned unpaid then immediate telephonic contact with the borrower is done. In case contact is
not established with the borrower then a notice with seven days grace period is served. If there is
no response from the borrower within 60 days then repossession of the vehicle is done. Insurance
is monitored on monthly basis.
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Bank Alfalah SWOT ANALYSIS
During the internship of eight weeks of mine in Bank Alfalah Limited, Credit Card Centre
Lahore, I am going for SWOT Analysis.
Strength
Weakness
Customers are not properly guided to get the benefit of BAL facility.
Opportunities
Banking industry is one of the most growing sectors in Pakistan. So Bank Alfalah should
be continually expanding its network of branches.
Muslims are more consciously differentiate the Islamic-base banking from interest-base
banking. That is why there is large caution of expansion.
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Mobile banking should be started to compete in market.
Establishing foreign branches.
All products of Consumer Financing that include home financing, car financing, home
appliances products and others should be introduce to all the branches in the cities of
Pakistan.
Threats
Banks in Pakistan those having large networks of hundred branches like MCB, HBL etc.
are the great threats for Bank Alfalah Limited. Large networks can play the important
role in banking business. BAL having small network of 95 branches compare to other key
players in industry.
Many other banks are now involving themselves in consumer financing at competitive
rate. This is one of the biggest threats for BAL consumer financing products.
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Overview of different departments and working as internee
I worked in different departments during this two month period of internship. I was not given
access to the cash department but I was taught about the working of cash department that’s why I
included the functioning of cash department.
There is a contractual relationship between “a Bank” and “a Client” and opening of an account
with the bank is the first step of this contract. BAL chooses its clients very carefully as it
believes that good clientele is at the heart of good business. Before opening an account the bank
make an inquiry about customer’s identity, address and source of his income etc. This process is
called “know your customers” also known as “customers due diligence”. Enhanced due
diligence (Edd) is the next step of this process which includes an ongoing verification and
updating customers records if necessary.
Copy of CNIC as well as Source of income (pay slip, business proof) should be obtained
for customers due diligence (kyc)
Filling of account opening form
Two signature specimen card (SSC).
One form signed by the customer that his or her sign is other than English.
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If customer’s signature is different from that of CNIC then one form is signed for undertaking
that his or her sign is different from CNIC.
Complete form is send to the head office if there is any mistake the head office show discrepancy
in through mail. The bank Alfalah has centralized system. That’s why it is also shown to the area
manager and also to the branch manager. If all the documents are correct then firstly the letter of
thanks is send at customer’s address and then after the six days the cheque book is received by
the branch and the customer come with the letter of thanks and take his or her check book. The
bank takes sign at the first page of check for record.
The documents provided by the account opener are verified by the department head. In Bank
Alfalah this verification is done by the cash and deposit department head. The signatures are also
verified and a signature card is maintained for the purpose of future verification if required. The
account is then entered into the bank's system and processed for getting the account number and
the customer number.
After opening of account a letter of thanks is sent by head office at customer’s address. This
letter of thanks customer brings at bank and hand over to account opening in charge and cheque
book is issued to customer.
In case of any alteration the account opening officer is required to update the customer’s
account. The updating is required in the following cases
Change of address
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Addition of signatories and attorneys Change in
signatures
Account Closing
It is the second function of this department. For closing an account the customer is required to
The account opening officer gets an annexure (given on next page) approved by all the
departments and then closes the account. This is a sort of clearance from all the departments. The
cheque book is then destroyed. Account closed log file is printed in order to complete the process
of closing an account. In the end the account opening form is filed in the closed accounts file.
Types of accounts
Easy access to funds through cheque book and VISA Debit/ATM Card that can be used globally
at over 30 million outlets and at more than 2 million ATMs.
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Alfalah kamyab karobar account
Free (Issuance & Annual Fee) Alfalah Debit Card (Visa) accepted at over 30 million outlets and
2 million ATMs worldwide
Free online transaction (including funds transfer, cash withdrawals & deposits) within Bank
Alfalah branches nationwide
Saving account
Open with an initial deposit of Rs 100 only No monthly minimum balance requirement Profit is
calculated on the average balance Profit is paid semi-annually
Amount can be placed for 1 month, 3 months, 6 months, 1 year, 2 years, 3 years, 4 years and 5
years.
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Remittance Department
Remittance means the transfer of funds form one account to another or one city to other city.
Instruments which are used for transfer of money are
Demand Draft
Pay order
These are also called banker’s cheques or bank draft and cannot be bounced. A banker's cheque
is a cheque provided to a customer of a bank or acquired from a bank for remittance purposes.
A normal cheque represents an instruction to transfer a sum of money from the drawer's account
to the payee's account. However, it is impossible to predict when the cheque will be deposited
after it is drawn. Because the funds represented by a cheque are not transferred until the cheque
is deposited and cleared, it is possible the drawer's account may not have sufficient funds to
honor the cheque when the transfer finally occurs. This dishonored or 'bounced' cheque is now
worthless and the payee receives no money, which is why cheques are less secure than cash.
By contrast, when an individual requests a banker's draft they must immediately transfer the
amount of the draft from their own account to the bank's account. Because the funds of a
banker's draft have already been transferred they are proven to be available, the draft will be
honored
Demand Draft
It’s a negotiable instrument. DD is used to transfer money by an individual from one city to
another person in a different city. A draft is a Cheque drawn by a bank on its own branch or any
other branch of another bank at a different place requesting it to pay on demand a specified
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amount of money which is already received to the person named on it.DD cannot be issued
within the same city. DD (Demand Draft) open on customer demand, when someone wants to
pay another person out of city but there must be Bank Alfalah Branch where DD can be drawn.
Branch is liable to pay where it is drawn.
Pay order
Pay order is an instrument used to make payment within the same city. A person may want to
submit a pay order when he or she wants to pay someone or a company without the use of a
personal check. A pay order is sometimes more reliable than a personal check because it is nearly
always negotiable by the payer, the third party and the bank. It is used for local transfer of money
from one person to another person. Pay order are more liquid as compared to cheques because
cheques may be dishonored while PO can’t be. General concept about Pay order is that it is used
when pay within the city. It is crossed by default. It’s non-negotiable instrument.
Clearing department
In clearing the customer who is maintaining the account in Bank Alfalah can present the cheque
of any other bank like the customer presenting the cheques of MCB Satellite town branch. So
instead of going to the MCB satellite town branch the customer presents it to the Bank Alfalah ,
CSO put the stamps on the cheque enter it into the record put the scroll number then send it into
the clearing, then this cheque goes to the MCB, if all obligations are fulfilled like balance,
signature all are clear then MCB clear the cheque and send through the clearing to Bank Alfalah
where staff gives the credit to the customer and if cheque is returned because of any reason like
signatures are not correct or if there is no balance then customer is charged Rs 200. The
procedure of clearing is facilitated by NIFT (national institution of facilitation technologies).
Clearing procedure require 1 day for completion.
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NIFT: It is an institute which performs activities for clearing and collections. This is institute
created by the government. The branch of NIFT is situating at high street Sahiwal. All the
external functions of clearing are carried by NIFT (National Institute of Facilitation Technology)
while the internal operations are performed by clearing department. NIFT is providing
tremendous facilitation having error rate of 0.3%. It is just like any courier service which takes
the cheques of other banks and delivers the cheques of that branch to it.
Types of Clearing
a. Inward Clearing
b. Outward Clearing
c. Intercity Clearing
d. Same Day Clearing
Inward Clearing
Inward clearing means cheques received by the bank from other banks. For example Cheques
and other negotiable instruments which are drawn on bank Alfalah, sent by other banks,
constitute the inward clearing of Bank Alfalah. After having all the necessary stamps and dates
of cheques confirmed, the concerned drawer’s accounts are debited in Bank Alfalah limited.
Outward Clearing
Outward clearing means the cheques sent for collection .When cheques and other negotiable
instruments drawn upon other banks like UBL Bank, MCB, or ABL are presented in Bank
Alfalah to deposit them in the respective payee’s accounts, these instruments are lodged in
outward clearing of Bank Alfalah.
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Consideration for inward and outward clearing process
Following things must be checked for inward clearing and must be ensured to prevent return
during outward clearing process:
The name of the branch appears on its face where it is drawn. Amount
in words and figures should not differ.
If order instrument suitably endorsed and the last endorsee’s account being credited.
Intercity clearing
Intercity clearing includes those cheques that are drawn on the bank Alfalah branches from
different cities of the country. Inward clearing that is outside the city is called intercity inward
clearing. Outward clearing that is outside the city is called intercity outward clearing.
Clearing of cheques which occurs in one day is called same day clearing. Presentation and
clearing of cheques is carried out in the same day. But there is a condition under which a
customer can use the facility of same day clearing and that is, cheque should be more than
Rs.100,000 otherwise a person can’t use the facility of same day clearing.
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Cash department
Cash department of work operated under operations department. This department is given the
complete responsibility of cash. It is also responsible for the book keeping of these transactions
and the safe custody of cash. All counters are dealing at the same time in deposits, withdraw and
online transaction processes. This department performs the main function.
Cash receipts
Cash payments
Cash Receipts
In cash department, depositors use deposit slip for depositing the amount into their accounts. The
officer checks if the deposit slip is properly filled up containing title of account, A/C number
date and amount in words and figures. Cash is received by cash receiving officer, twice counted
and matched with the deposit slip. The cash details are written on the deposit slip and are also
entered in computer software called “Temenos”.
Cash received stamp is affixed on the face of the deposit slip along with the signature of the cash
receiving officer. Deposit slip is forward to the officer in the cash department. Again proper
scrutiny is made by the officer cash department both on cash receipt and Temenos software.
Officer cash department sign the deposit slip and finally approved the transaction on Temenos.
Deposit slip is credited and posted in the concerned accounted in the system.
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Cash Payments of Cheque
All three counters deal with cash payments. The process for payment of cheques local and
foreign currency is same. First the cheque is presented by the customer or holder to cash payment
officer. He confirms that it is drawn on the same branch and the particulars of cheque are
properly filled in. Two signatures of the holder are taken on the back of the cheque. Officer
checks the date, amount in words and amount in figures, payee’s name, crossing if any, account
number, cheque serial number, any material alterations / endorsements and signature of the
customer. Account is debited in Temenos and then cheque is cancelled by the officer. It is posted
in the system and posting stamp and number is affixed on it. At the end officer hands over cash
to client.
In this section I am going to summarize the learning during the period of internship.
Account opening department: I have learnt about the working of different department. I have
learnt the account opening procedure. I have known the purpose of customers due diligence. I got
knowledge about types of accounts, benefits of each of these accounts and the balance
requirement for each type of account. Branch offers different types of accounts to its customers.
Remittance department: I have learnt the functions of remittance department, need for
remittance and different types of remittances, pay order and demand draft etc. I was taught the
difference between pay order and demand draft. I have also known that banker’s cheques are
different from normal cheques. These are safer than normal cheques and are used for legal
payment such as payment of property.
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Clearing Department: I learnt the working of clearing department. When cheques of different
banks are presented in bank Alfalah then clearing department performs the internal functions of
clearing. Different stamps (clearing stamp, special crossing, payee account credited) are posted
on the cheque which is to be sent for clearing. I got knowledge about different types of clearing
such as inward clearing, outward clearing, intercity clearing and same day clearing.
Cash Department: I was taught the functions of cash department. Cash department performs the
function of cash receipt and payment of cheques. I filled the cash and cheque deposit slips which
are used for depositing cash and cheques. I filled online cash and cheque transfer slips which are
used when amount is to be sent from one account to other account.
I have also seen the application of bookish concepts in bank Alfalah, detail of which is given
below.
I have done the two months internship in BAL branch during this period I have learned many
new things and also seen the applicability of the bookish concept and terminology in the bank. I
have seen how the class room learning can be applied to the particle work.
Business communication helps in dealing with the customers to satisfy them and heading their
complaints.
Subject of management help me to learn about the culture of the bank management style and
decision making rules.
Subject of money and banking helps me to learn a lot of things about the bank such as types of
cheques, bouncing of cheques, types of customer and form of money.
Economics helps me to learn about the interest rate and government regulations about the banks.
Subject of organizational behavior helps to see the organizational ethics and how to behave with
the employees and customers in ethical manner.
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OBSERVATION & CONCLUSION
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.
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. Phone
Banking and credit card have been introduced in many cities.
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RECOMMENDATIONS
During my internship I found some of the faults and lack of some of the facilities in bank’s
operations. Here are some of the suggestions which I recommend to the Bank Alfalah.
The advertising of bank and bank’s products is not so much good and exposed to people. So,
Bank should hire some of the skilled marketers who can design creative and attractive
advertisements and advertising campaigns by using all possible Medias to make every person
aware of the bank’s updates about old and new products and services.
Training sessions of bank employees of all over the country are conducted by bank at Head
Office Karachi which is very expensive for the bank to bear the accommodation and meal
charges of the employees. So bank should expand and establish some more training centers in
other cities of the country in order to reduce these expenses.
The top management should immediately start thinking in terms of rotating the employees in
various departments, as this transforms work force into human capital, if a particular individual
keeps on employing his\her efforts in one sphere of banking it would not only create a sense of
monotony, but also not help improving the skills of Bank Alfalah Limited employees
Bank should go for external recruitment. Bank should give chance to fresh applicants so that they
come up with new ideas and trainings.
Foreign branch network should be increased in order to capture profits from all over the world.
Recruitments should be strictly on merit basis and induction should be after proper and extensive
training. Old and lazy staff should be replaced by young, qualified and energetic staff.
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The bank Alfalah has centralized system. Decision making should not be centralized but the low
level employees should also take part in the decisions so that they also feel the proper members
of the branch.
Bank should give some more incentive to its employees in order to remove the conflict between
lower and higher officers and should try to improve the working condition of the bank.
Employees should not be overloaded with work, this helps in relaxation of employees and will
increase job satisfaction of employees which is in best interest of the bank
Schedule should be arranged for the internees in whom they know about their working and the
requirement.
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REFERENCES
https://www.bankalfalah.com/
https://en.wikipedia.org/wiki/Bank_Alfalah
https://profit.pakistantoday.com.pk/2018/04/24/bank-alfalah-denies-its-up-for-sale-profit-
stands-by-its-story/
http://www.sbp.org.pk/publications/anu_stats/index.htm
https://www.bankalfalah.com/financial-reports/annual-report-2017/
http://www.sbp.org.pk/stats/Balance/2017/BankAlFalahLtd.pdf
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