INTERNSHIP REPORT

INTERNSHIP REPORT2013

M.B.A (Finance 3.5 years)

Internship report on The Bank of Punjab submitted to the department of the Assistant Director of Academic for the requirement for the degree of Master of Business Administration August 22, 2013

DedicationI would like to dedicate my this effort, which are m y first step towards my practical career, to my Parents, all Teachers, all Friends, all beloved peoples and who contribute to expand my knowledge, to understand this world for recognizing Allah Almighty.

Acknowledgement

First of all I like to express my thanks and gratitude to Allah Almighty, He give me strength to complete this task of internship report.My 6 weeks internship o the Bank of Punjab management system has become the latest topic for me and I completely accomplish my task individually with the help of my father, So I wish to give credit to all my colleagues, supervisor and contributors to enhance my experience bout the practical training in the Bank of Punjab.

Contents:Chapter one:Introduction------------------------------------------------------------------------------81.0 Background of study-------------------------------------------------------------81.1 Purpose-----------------------------------------------------------------------------91.2 Scope-----------------------------------------------------------------------------101.3 Objectives-------------------------------------------------------------------------101.4 Methodology----------------------------------------------------------------------111.5 Organization----------------------------------------------------------------------101.6 Summary---------------------------------------------------------------------------11Chapter two:Introduction----------------------------------------------------------------------------112.1 Overall respective sector in Pakistan--------------------------------------------112.2 Role of the organization in Pakistan--------------------------------------------112.3 Overall Organization and function of the org in Pakistan---------------12-172.4 Organization office in which you are working--------------------------------172.5 Summary----------------------------------------------------------------------17Chapter Three: OrganizationIntroduction--------------------------------------------------------------------------183.1 Brief history of the organization---------------------------------------------18-213.1.2 Relationship of head office to the branch offices-------------------------213.1.3 Number of departments--------------------------------------------------213.2 Current staff----------------------------------------------------------------------303.2.1 Current staff of the branch according to qualification and experience313.2.2 Training received by no. of people or no. of employee--------------------31

3.2.3 Workload (it is based on no. of hours worked) -----------------------------323.2.4 Salary structure------------------------------------------------------------323.2.5 Promotion system---------------------------------------------------------323.2.6 Incentives and motivation-------------------------------------------------333.3 Critical analysis of the branch----------------------------------------------333.3.1 Communication system----------------------------------------------------343.3.2 Hiring system-----------------------------------------------------------------353.3.3 Morale of staff-----------------------------------------------------------------353.3.4 Physical facilities-----------------------------------------------------------------353.4 Performance---------------------------------------------------------------------363.5 Summary------------------------------------------------------------------------------37Chapter Four:Introduction--------------------------------------------------------------------384.1 Policies--------------------------------------------------------------------384.2 Strategies----------------------------------------------------------------------394.3 Successes------------------------------------------------------------------------404.4 Summary------------------------------------------------------------------------41Chapter Five:Introduction------------------------------------------------------------------------415.1 SWOT---------------------------------------------------------------------------415.2 PEST analysis---------------------------------------------------------------------445.3 Summary--------------------------------------------------------------------------45Recommendations------------------------------------------------------------------45Conclusion---------------------------------------------------------------------------47References---------------------------------------------------------------------------48

Chapter # 1Introduction:This is the first chapter of my internship report. This chapter include background of my study, Scope, Purpose of internship, Objective, methodology which I used to collect information, organization in which I done our internship is BOP (The Bank of Punjab Established in Pakistan on 15 Nov 1989, in pursuance of The Bank of Punjab Act 1989and was given the status of scheduled in 1994), and the last summary of this chapter. The background of my study include inspirational factors due to which I selected BOP, in scope the learning in functional departments, purpose is to meet the requirements of degree, organization tells about the history and methodology shows the methods of data collection for report. I explained all these elements in detail. At the end the summary of this chapter is given.1.0 Back Ground of study:The economic growth of a country, among many other factors, depends mainly on the strength of the financial institution operating in a country. The banking sector is one of the example of financial institution which can play a very vital role in development of the overall economy of a country.Banking sector has now become a very challenging field with the advent of modern technology and increased competition.For internship my selected bank was THE BANK OF PUNJAB in short known as BOP in banking sector.Established in Pakistan on 15 Nov 1989, in pursuance of The Bank of Punjab Act 1989 and was given the status of scheduled bank in 1994.The Bank of Punjab is working as a commercial bank with its network of 2/2 (2007) branches at all major business centers in the country and strength of employees are 2373 employees. Branches of this bank are increasing all over the country at a gradual speed, which shoes that customers are placing confidence and satisfaction in the services of BOP. In fact, it has made wonderful advancement in a very short time as compared to other bands in Pakistan. From the financial point of view, as I am student of MBA, financial position of bank is very strong. Market value of its shares is showing increasing trend, price earning ration and other ratios are showing favorable position of the bank so I decided to choose BOP for my important and compulsory internship in final semester.1.1Purpose: One of the major aims of internship to make student under all those concepts that we learn in university are almost same to the practical working in any organization. Interaction of students with the working environment of organization and make student to a good observer, communicator, build confidence and face different sort of challenges but more focused on the bases of PR more chances of progress no matter which ever field you chose for you career.1.2Scope of Work: Banking sector owes a pivotal importance in the economy of any country through its vibrant functions. This is the deep-seated motivator that geared up me to join any bank for internship. Moreover, the practice and familiarity learned during this tenure would also attest very helpful and alleviating in the awaiting proficient life. There are different department in bank like Cash department Credit department Remittance department Foreign exchange departmentIn practice I cannot covered all areas of banking system but cover Account opening Account closing Financing1.3Objective: Internship provides us practical learning along with our bookish knowledge that we got from the university. Internship polishes our skills. Concepts become clearer and we will feel the difference between our past learning and this practical work. Increase in the confidence level and our mental approach become extensive. Dynamic thinking becomes part of our daily life during this period of internship period and that reflect changes in our life as well. Think out of the box more we have question answerer section our mental approach become versatile.1.4Methodology of the student:The data collected for the first time is called primary data which was through InterviewsThe senior and the experienced staff at the branch level were interviewed to know their views about the different problems faced by them in their routine duties. Observation:Begin an internee, different methods, procedures, rules and regulations used by the staff members while working their routine jobs were observed.1.4.2 Secondary Data:The data, which has gone through mathematical and statistical techniques after its collection, is called secondary data. The main sources of secondary data are different publications of BOP. These include annual repots, manuals, newsletters, website of BOP and brochures etc.Organization:The Bank of Punjab Established in Pakistan on 15 Now 1989, in pursuance of The Bank of Punjab A ct 1989 and was given the status of scheduled banks in 1994.The Bank of Punjab is working as a scheduled commercial bank with its network of 282 (2007) branches at all major business centers in the country and strength of employees are 2373 employees. Branches of this bank are increasing all over the country at a gradual speed, which shows that customers are placing confidence and satisfaction in the services of BOP. In fact, it has made wonderful advancement in a very short time as compared to other banks in Pakistan.From the financial point of view, as I am student of MBA, financial position of bank is very strong Market value of its shares is showing increasing trend, price earning ratio and other ratios are showing favorable position of the bank so I decided to choose BOP for my important and compulsory internship in the semester. 1.5Summary:The summary of this chapter included all the basics details of The Bank of Punjab that are discussed in the chapter. This is the end of chapter one which contained the introduction of my internship report in the Bank of Punjab the Kutachary Road Branch, Gujart has given. In this chapter it is described the inspirational factors due to which I selected bank of Punjab. Scope of my study are also given. The brief history of organization as well as the purpose of internship is also mentioned in this chapter. The summary of this chapter included all the basics of Bank of Punjab that are discussed in the chapter. Chapter # 2Introduction:This is the second chapter of the report. In this chapter also different aspects of my study are mentioned in detail. In this chapter the focus of my study is on overall respective sector in Pakistan, role of the organization that lays a vital role in the economy of Pakistan, organization overall functions that are performed by organization. And the organization office in which I has done my intership. I explained all these elements in detail. At the end the summary of this chapter is given.2.1 Overall Respective sector in Pakistan:Pakistan is having a very developed banking system in south Asia. Pakistans banking sector is developing at a very fast pace and banking sectors contribution is increasing toward the development of economy. The Bank of Punjab is also one of the most popular banks in Pakistan In fact, it has made wonderful advancement in a very short tiem as compared to other banks in Pakistan.2.2 Role of the Organization:Perform proactive and pivotal role in economic progress and prosperity through reengineered operations and innovative financial products. Objective:To exceed the expectation of our stakeholders by leveraging our relationship with the Govt. of Punjab and delivering a complete range of professional solutions with a focus on program driven products and services in the agriculture and middle tier through a motivated team. Market Positioning:The Bank of Punjab is increasing all over the country at a gradual speed, which shoes that customers are placing confidence and satisfaction in the services of BOP. In fact, it has made wonderful advancement in a very short time as compared to other banks in Pakistan.Market value of its shares is showing increasing trend, price earnings ratio and other ratio are showing favorable position of the bank.2.3 Overall organization and functions of organization in Pakistan:2.3.1 Consumer products1. Saving account2. Current of demand accounts3. Fixed account Saving account (PLS)These types of accounts are designed to encourage the saving habit of the customer and lead to long team or invest relationship. Bank saving account in the nature of deposit accounts and are not normally available for drawings. The cash reserve ratio is typically low then the current account because the withdrawals against eh account are very low. CURRENT OF DEMAND ACCOUNTThese are those deposits, which can be drawn by the depositor at any time by representing a cheque to the bank. People deposit their money in this account they gave a ready command on their account in developed countries of world, a very significant part of money is kept under current ot demand account. The operating cost for the handling of this type of account is very regular. FIXED OR TERMS ACCOUNTFixed accounts those which are deposited for a fixed period of time and repayable after the expiry of stipulated time to the customer. Those people who have surplus funds and what to have investment deposit the amount in the fixed account.The rate of this type of deposits is higher the saving bank accounts. The cash reserve against this deposit are very low because there no fear of with draw of a month before the stipulated of time.2.3.2 FINANCE PRODUTS1. Agriculture schemes2. Business promotion finance schemesAgriculture SchemesThere are many agriculture promotion schemes provided by BOP. Kissan dost agriculture finance scheme Kissan dost tractor finance support scheme Kissan dost mechanization support scheme Kissan dost farm transport schemeSuch type of schemes provides framers a real plate from to accelerate. Some facilities given by kissan dost. Agricultural finance scheme are: PurposeProvision of financial facility for purchase of inputs (seed, fertilizer, pesticides, fungicides etc) AmountMaximum of Rs.500000 according to per acre limit of the crop. SecurityCharge on agriculture land through agriculture pass book. InsuranceThe borrower will have to arrange life assurance under the Banks charges. Mark-up9% mark-up per annum. Business Promotion Finance Schemes BOP car loan BOP house loan BOP assaish loan BOP house loan for federal Govt

BOP CAR LOANBOP car loan is a demand financing facility to purchase brand new locally manufactured/assembled cars for personal use. All must have the holding of NIC. BOP Aasaish loanBOP asaish loan is demand finance facility for purchase of consumer durable goods like tv, refrigerators, mobile, microwave oven, fans, audio/video system etc with no down payment, in addition with the free home delivery.2.2.3 SERVICESThese are the services of provided by the BOP. ATM facility Letter of credit Pay order On-line banking E-banking Debit card Consumer financing Agriculture financing Corporate financing Commission financing Commission free remittance Demand draft Collection of utility Lockers facility Automated teller machine(ATM)Through the ATMs customers have access to the various service such as withdrawal, balance enquiry and mini statement? Cash withdrawal limit is up to Rs.20,000 per day. Annual charges of ATM is Rs.250/- per card. It is one of the utility seavices that BOP provides to their customers for keeping jeweler, important documents and other valuable. Demand DraftsBOP provides safe, speedy and reliable way to transfer money at very reasonable rates. Any person whether an account holder of the bank or not can purchase a Demand draft from a bank branch. Letters of CreditBOP is offering its business customers the widest of option in area of money transfer. BOPs letter of credit is the best way to do the business transaction. Pay OrderBOP provides transfer of money using different facilities. Its pay order is a secure and easy way to move the money from one place to another. The charges for this service are extremely competitive. Mail TransferMoves money safely and quickly from BOP mail transfer service. The rates for this service is quiet impressive as compare to the market. Short Tern InvestmentBOP offers excellent rates of profit on all its short tern investment accounts. The packages are starting from 3 months. BOPs rates of profit are extremely attractive, along with the security and service only BOP can provide. Agricultural FinanceIt help farmers utilize funds efficiently to further develop and achieve better production.

2.3.4 FUNCTIONS OF THE Account/Finance Functions of finance departmentThe management of BOP comprises of two ie chairmans secretariat & president secretariat. Chairmans secretariat deals with finance division. Mr. Nadeem Amir is general manger of finance division of mentioned secretariat. The financial analyst related to BOP mattes of chairmans secretariat is Mr. Masroor Zaigham Use of electronic data in decision makingElectronic data gives exact values and figures which top level management required. Because of electronic data they came across to know those minute things which impact a lot on final place. Electronic data make management able to take decision at any point of time. Sources of funds trendThe major sources of funds are: Public SourceAs the largest regional bank Pakistan according to asset base with specialized in agriculture has a large deposits 80% from the rural areas of the Punjab. Money MarketFigurative expression for the informal network of dealers and investors over which short-term debt securities are purchased and sold. Corporate treasuries and Government InstitutionsCorporate sector one of the major sources of funds in all types of banking. All major organization, financial institution and government & private organization are the major sources of the funds e.g WAPDA.Allocation of Funds trendBOPs funds are allocated to the following departments. The banks major focus is no short term financing. Major allocation of funds is on these divisions. Long Term FinancingLong term financing includes tenure more than one year. Short term financingShort term financing includes tenure more than one year.From the above it is further sub distributed to1. Agriculture financing2. Consumer financing3. Corporate financing Agriculture financingThe bank provides adequate and timely financial assistance to the farmers to improve production potential of agriculture sector. Insurance of leased assets, animal, crops and life assurance of borrowers are all source of money for the bank. E-BankingThe bank has a centralized database that is web-enable. All the services that the bank has permitted on the internet are displayed in menu.

Utility billsThe bank also makes possible the payment of electricity, gas and telephone bills for its customers charging some commission on each payment. LockersCommission charged on lockers provided by bank for customers, is also a source of inflow for the bank. Consumer financingPersonal financing, mortgage finance, business finance, smart cash, auto financing and travelers cheques are all source for the bank. Agriculture financingThe bank provides adequate and timely financial assistance to the farmers to improve production potential of agriculture sector.

2.4 Organization Office which you are workingFor internship my selected bank was THE BANK OF PUNJAB in short as BOP and branch location is G.T road Sarai Alamgir and branch code is 0189.2.5 SummaryThe summary of this chapter include the details regarding functioning process of organization. Chapter two is the all about how the organization is working. In this chapter it is described that how organization plays an important role in the national economy by providing facilities to the valuable customers. Details about overall respective sector in Pakistan are also mentioned.

Chapter # 3IntroductionThis is the third chapter of my internship report This chapter is related to organization and its analysis. This chapter the focus of my study is on the history and nature of organization and also its relevant information, the data is related to that branch in which I have done work. There are four departments cash department, remittance, foreign exchange and credit department. This chapter includes history of organization, relationship of head office to branch office, number of departments offices, current staff their qualification, training. Workload, salary structure, promotion, communication and hiring system, morale of staff, critical analysis, physical facilities, performance I discussed all these elements in detail. At the end the summary of this chapter is given.3.1 Brief History of OrganizationPakistan came into being on 14th August, 1947; sufficient banking services were available in the areas foaming Pakistan. Out of the total branches of the nearly 3,500 in the undivided India, as many as about 1,500 branches were existing in these areas.It was agreed between the two countries that reserve bank of India shall continue to function in the Pakistan territory until 30th September 1948 and that India notes would continue to be legal tender at Pakistan until 30th September 1948. Unfortunately, relationship between the two countries became most strained immediately after independence; banking was mostly in the lands of Hindus who immediately started transferring their offices and assets into India. As a result most of the banks Pakistan were closed down and even those which were open were not doing any effective business.The number of banking office in Pakistan came down to about 200 on 30th June 1948. Branches of some European banks were also functioning in a limited manner, financing in export of crops and their was limited to about 20.It was only Habib bank, which transferred its office from Bombay to Karachi Austral.Nationalization of BanksThe principle of nationalization of banks is to stream line the operation of commercial banks in such away that it may be conductive to the development activities in process in the country.Since the commercial bank were owned controlled by big business groups of the century it was feared that these banks would not maintain uniformity in their operational and would be instrumental to inflationary pressure. However, the considerations behind nationalization are:

To form uniformity in the policy of the commercial banks so they may serve the best national interest. To make the operation of commercial banks highly sensitive and responsive to the policy of the government relation to financial matters. To make the credit policy of the commercial banks more purpose full and effective in the development of economic sectors of the country. It acts as an agent of the state Bank of Pakistan. To make the best use of the funds available at the disposal of these banks for the economic development of the country. To eliminate unhealthy and uneconomic competition among commercial banks. To development strong money banks market in the country so that the value of currency may be maintained at stable level both in national facilities to exporter and agriculturists which have not been satisfactory in the past years.

History & Nature of BOPThe bank of Punjab was established in 1989 and was given the status of scheduled bank in 1994. The bank of Punjab is working as a scheduled commercial bank with a network of almost 280 branches total over major locations in the Punjab. The bank provides all types of banking services such as Deposits Local Currency and client foreign currency, remittances, and advances to business, trade, industry and agriculture.

Vision StatementTo be a customer focused bank with services excellenceMission StatementTo exceed the expectation of our stakeholders by leveraging our relationship with the government of Punjab and delivering a complete range of professional solutions with a focus on program driven products and services in the agriculture and middle tire markets through a motivated team.Value of the bank CustomersAs our first priority ProfitabilityFor the prosperity of our stakeholdersThat allows us to constantly invest,Improve and succeed. Corporate social responsibility To enrich the lives of community where we live.Relationship of head office to the branch officeThe management of the head office has deep relationship to its branch offices to check the performance. The Head Offices management also has check and balance on the branch offices to achieve their desires goals.3.1.3 Number of departmentsBOP is one of the largest private banks of Pakistan. It offers a well-organized structure of specialized services distributed among its various departments. This departmental segregation provides BOP with more proper and professional approach and efficient means of performing each service. Departmentalization makes the services more proficient and specialized procedures for every job are used.Each branch is divided into the following departments:1. Cash department2. Remittance department

3. Foreign exchange department

4. Credit department

Cash DepartmentThe main function of this department is Payments and receipts. It collects and pays money to the customers, on behalf of their account, through cheques or any other negotiable instruments. There are three main functions of the cash department:1. Payment2. Clearing3. Receipts PaymentThe cash department issues payments on request. The checks are received by the department and after their clearance cash is issued to the check-holder.The payment deals with that customer who withdraws money through cheques or any other negotiable instruments. The cashier keeps the record of all payments in the register book. At the end the payment and receipt cashier checks the balance and count the cash. They verify that both register cash and the in hand are balance. ClearingAnother main aspect in the clearance of checks. It includes verification of proper data, amount, endorsements, such as issue stamp, clearing stamp and back-side stamp, and signature. After proper verification of checks the payments are issued. At the issuance of cash the cash is debited in the clients account. ReceiptsIt is responsible for taking cash deposits from its clients who want to store or invest their surplus reserves. In the receipt section, the cashier receives money from the customers on behalf of any individual of the company. Most of the receipt goes through the accounts of the BOP. The cash receipts are done in two forms:1. Collection of money from customers in their accounts2. Collection of utility bills Collection of money from the customer in accountsThe cash is received from the customers in their accounts. At the time of cash receipt, the clients accounts are credited.Every account holder can deposit money in his account at any time in working hour of the bank, they deposit the money through the bank receive voucher, which is of specific nature i.e. it may be PLS, current or MBLS etc. So the cashier deposits the money that is received. He keeps in record the voucher no, amounts, a/c no etc and then presents to the computer department for posting. CollectionofutilitiesbillsBOP also offers the facility of payment of utility bills. The customer can deposit electricity, gas, and telephone bills through the bank. The bills are received, stamped and kept in record. Then it is posted in the corresponding accounts of the bank in which the money is deposited. It also provides this convenience to private companies as well. Private companies also deposit their bills in the BOP accounts, which are similarly receive, kept in record and deposited in the corresponding accounts. Remittance DepartmentRemittance department is related to funds transferring. There are two main kinds of remittances in which this department deals. These are:1. Foreign remittances2. Local remittances Foreign remittancesForeign remittances include foreign demand drafts, foreign telegraphic transfers, and online transaction. Local remittancesLocal remittances include pay order, demand drafts, telegraphic transfer; rupee travelers check and mail transfer. All these remittances can be categorized into four main kinds:1. Demand Draft2. Pay Order3. Telegraphic Transfer4. Mail Transfer Demand DraftDemand Draft is, as its name implies, payable on demand. Demand draft is used for the transfer of money from one city to another city. This is issued by one branch and payable at other branch of same bank of other banks branch e.g. Demand Draft issued by BOP payable by NBP. Cancellation of DDOn receiving the application for cancellation along with original DD, the signature of the applicant is verified. This signature should tally with the signature on DD application form. Then cancellation is marked in DD issued register and the drawee branch is informed about cancellation. Pay OrdersPay order is a kind of instrument issued and paid in the same branch.Procedure of Issuance of Pay order:The client fills the remittances application form and checks on the pay order item. Then a pay order is issued to him after receiving chargers. All pay orders are crossed i.e. Payees account only. Pay order can only by cancel by the beneficiary. Telegraphic TransferTelegraphic transfer is used usually when the money is needed to be sent abroad. It is a facility provided by the bank through which a customer can send or transfer any amount immediately. The person who wants to transfer the funds may not have the account in the bank. The customer fills an application form called the Application for Remittance. He mentions the name of the bank to which he wants to transfer the funds and the name of the payee, his account number, and his own address etc. The bank charges for this special facility to the person who is the funds.There are two kinds of telegraphic transfer:1. Ordinary Telegraphic Transfer2. Telegraphic Transfer Ordinary Telegraphic Transfer reaches to its destination after two days after it is dispatched. For ordinary TT only two vouchers are prepared: Commission Voucher Postage Voucher Telegraphic Transfer reaches to its payee immediately because the payee branch is informed immediately through telephone and fax. For this, three vouchers are prepare: Commission Postage Telephone charges Foreign Exchange DepartmentThe clearing and cash departments deal in Pak Rupees. Foreign exchange department is related to foreign currency accounts maintenance. It uses the same procedures as cash and clearing departments but all the transactions are done in foreign currency. Foreign transfer of money (FTT) is also used to transfer money in Pakistani Rupee to any other currency, such as US dollars.In foreign exchange department, the major things to be dealt with are:1. Foreign Currencies Deposits2. Foreign Trade3. Foreign Exchange Rate4. RemittancesThe foreign exchange department deals with the foreign currency accounts. It deals in following main foreign currencies:1. US Dollar2. UK pound 3. Euro4. AUDFor Account opening minimum balance for each of these currencies is 500 in the respective currency. The accounts in which foreign currency accounts can be opened are PLS, Current Account and Fixed Account etc. These accounts are opened in the currencies other than Pakistani currency.Kinds of Foreign Exchange TransactionThe foreign exchange transactions are usually put into four categories: Current transactions Capital transactions ST financial transactions Working balancesCurrent Transactions As regards the current transactions, they are further divided in to clauses.Visible Trade:Visible trade is based on the import and export of physical goods known as merchandise.Invisible Trade:The invisible trade has no direct relation with import and export of physical goods. It is the payment made to or received from the foreigners for the shipping, banking, insurance services received or provided to tem. Interest on capital, dividend or remittance of profits, etc.; from one country to another also fall in the category of invisible trade.Capital TransactionsCapital transactions are different from financial transactions. When country grants aid or gives long-term loans or invests employing foreign exchange in another country, a capital transaction is then said to have operated.Short term financial TransactionIf the citizens of one country, due to political or economic reasons, transfer their foreign exchange resources to another country for a short period, it is then said to be a short-term financial transaction of foreign exchange.Working balanceThe commercial banks sometimes keep their working balances in foreign currencies in other countries for earning higher profits or due to the fear of devaluation in the home currency or unfavorable political conditions in the home country. In all such cases, the demand for and supply of foreign exchange is affected.ImportsImports mean bringing commodity into Pakistan from outside, by sea, land or area. In import LC play an active role for settlement of payments in international trade service offered by bank to its customer. The gap between import and export bills partially covered by regulations, controls and measures covered by SBP and partly by international credit aid, loan agencies. SBP controls the import by imposing cash margin restrictions on import of general item from time to time. To restrict to only genuine requirement and to discourage import of non-commercial and luxury items. Credit DepartmentCredit department basically provides two types facilities. Criteria for Granting loans AdvancesThe criteria that a banker measures for the advances are as follow. The person is of sound mind. He himself is interesting in the loan. The customer has good character, he has capital, and he has the capacity to pay back. He has good condition of business. He never became default of any bank. The sector in which he is investing is productive. That sector is important according to nation. The remuneration on the loan is good. There is dispersal in the sectors of investment. The loans are structured on the basis of underlying project characteristics and cash flows of the business. Credit proposalsWhen a customer comes with a request for credit, the credit officer in consultation checks whether it will be feasible to grant credit to that particular customer or not. After the bank decides to extend the credit facility to a customer a credit proposal is executed on the prescribed forms published by the bank. The initiating officer should submit a Credit Proposal one month prior to its expiry date. The General Managers office must also ensure that all the basic requirements are complete before processing the proposal any further. The basic requirements of Credit proposal are: Analysis of latest financial statement and comparison of borrowers present status with his historical performance (3 Years). Explanation of any significant variation should be obtained. Also last annual are being observed. Past approval conditions are being observed. Past performance of the customer in repayments/meeting his obligation. Comments on:a) Changes in security position (If any).b) Management.c) Future prospects (For the next year). Return /Income of the corporation. Bank checking from other lending banks (Every 3 years). Full complained of SBP Prudential Regulations. Latest SBP-CIB report to be attached. If there are any company/group over dues, there must be fully explained. Also the banks action plan is view of overdue to be given. If group account exists, the entire individual Credit Proposals to have the same expiry date. In such a case Credit Proposal for each individual account to be attached with a group summary sheet.

Procedure for submitting Detailed credit ProposalThe customer fills a prescribed form named Credit Proposal.For short-term accommodation not exceeding period of 90 days form title Short Credit Proposal is submitted.For considering the proposal the following points must keep in mind by the bank: The type of facility, its opening terms & conditions and mode of repayments. Rates of Mark-up, Charges, Commission, Percentage of Margin. Security position should be clearly defined. i.e. Security & types of charges over the same in the banks favor and value of security (Stating basis of estimation).Manager/Chief Manager must also consider the following factors to motivate his decision to recommend the credit. Customers background, financial standing & Integrity. Profitability & value of the account. Quantum of business, as banks share, if other banks are involved. Nature/Value of security easily realizable & adequate to fully cover all facilities afforded. Careful examination of the following aspects. Dormancy, if any, in the financing. Proper spread of bill draws. Bill dishonored/Overdue for payment. Critical appraisal of the customers audited/un-audited accounts.\ Strict conformity with all SBP exchanges control. Examine any facility, which is un-usual. Credit Approval ProcessAs per loan amount and discretionary powers the case is forwarded if the limit amount is in discretionary powers manager of chief manager the sanction advice is issued in the branch. The discretionary powers are kept confidential to outsiders. The chain of authority of approve a loan is as follows Branch manager Chief manager Regional manager General manager SEVP corporate Area credit executive President

Credit Proposal Scrutiny ChecklistIt includes the following: Name of the Customer Expiry Date Routing Sheet Basic Information Record attached (For limit excess of Rs.0.5 Million) Latest Call Report attached Latest audited financial analysis (Latest financial reports attached) Credit risk checklist attached

3.1.4 Main OfficesHead office and the main branch of BOP is in Gulberg 3, Lahore & Egerton, Lahore Respectively.The Bank has been divided into seven regionsEach consisting a number of branches. Lahore Region Faisalabad Region Gujranwala Region Rawalpindi Region Karachi/Quetta Region Multan Region Peshawar Region3.2 Current StaffThere are 8 employees both managerial. and non-managerial work in the organization.

Name Designation

Sami UllahNazAwanManager

Arshad JanOPS Manager

M farhan JaffarBanking Officer

Munir AhmadCash officer

Zaheer Abbas B.D.O

Niaz AhmadDay & Night duty guard

Wahid Hussain ShahDay Duty Guard

M Ilyas Messenger

3.2.1 Current Staff of Branch according to qualificationNameDesignationQualification

Sami UllahNazAwanManagerM.sc

Arshad JanOPS ManagerMBA

M FarhanJaffarBanking OfficerB.Com, ACMA part2

Munir AhmadCash OfficerB.Com

Zaheer AbbasB.D.OB.Com

Niaz AhmadNight & Duty GuardMiddle

Wahid Huassain ShahDay Duty GuardMiddle

M IlyasMessengerMatric

3.2.2 Training received by no. of employeesI received training Arshad Jan Operation manager inSarai Alamgir branch of the Bank of Punjab.3.2.3 Workload (No. of hours worked)

9 am to 5 pm business working hoursNon Stop Banking9.00am to 5.30 pm business working hoursIn Friday the timing of bank are:9 am to 5.00 pm business working hours1.0 pm to 2.30, Juma Prayer Break.

3.2.4 Salary StructureNameDesignationQualificationSalary

Sami UllahNazAwanManagerM.Sc60,000

Arshad JanOPS ManagerMBA 50,000

M FarhanJaffarBanking OfficerB.Com ACMA part 240,000

Munir AhmadCash OfficerB.Sc30,000

Zaheer AbbasB.D.OB.Com20,000

Niaz AhmadNight & Day Duty GuardMiddle10,000

Wahid Hussain ShahDay Duty GuardMiddle17,000

M IlyasMessengerMatric12,000

3.2.5 Promotion systemPromotion based on performance and services of employees, otherwise they have also a chance to get promotion after 3 years according to the policies of head office.OFFICERS.Normally promotion is done on seniority basis. A promotion is due after a person has completed three years in the same grade.CLERICAL AND NON CLERICAL STAFF.Its on the basis of their length of service and the written tests and qualifications.QUALIFICATIONLENGTH OF SERVICEMatriculate.Six years service.Intermediate.Four years service.Graduate.Two years service.More over interviews and tests also contribute in promotion.3.2.6 Incentives and MotivationThe bank provides the incentives in the form of health and loan facilities and also motivate their employees through bonuses and increase in their salaries and sometimes provides rewards on the basis of their performance.3.3Critical AnalysisThis part of reports is the essence of the internship, as this will help other students to better understand the working environment of the bank by finding the relationship between what is written in the books and what is actually going on in fields. The theory written in the books in cases is not implemented as it is. In some cases theory is implemented with a little modification but in other cases theory has nothing to do with practice.In accounting, banks dont prepare worksheet, but part of worksheet is prepared like trial balance, but little differences, theory and practice has substantial relationship. The securities for the loans are handled in the same way as theory says like mortgage, pledge, hypothecation, advances against insurance polices or liquidation procedure is the same. The difference is there in the case of loans. Theory talks about four or five terms of loans that is cash finance, overdraft, loans etc. but in practice there are some more terms used like running finance, demand finance etc. All other concepts of remittances, bills, foreign exchange deposits, letters of credit are in accordance with theory almost. So for a internee it is more important to learn new things which he/she has never heard about in his/her course book.To me, Theory gives you the direction to understand the process and the terminologies going across the World using best business practices in a broader view covering each and every aspect of possible business scenarios. On the contrary practical life is specific, enclosed in a jar. In practical professionalism and firms environment is each and every thing. Professional life only builds on the knowledge based on books even thought it may only use 1% of the theoretical knowledge. Computer systemThe system has not totally shifted on computer. Manual procedure is still there hence computer facility is not fully availed. There should be a system at each counter for quick processing.

Right person for right jobDuring my internship I have observed the person who has came as customer Relationship Officer was acting as Cashier. It should not be like this. The person should be posted according to his qualification, profession skills and experience. Customer problemPeople have to wait for en-cashing their cheques for about 10-20 minutes, which is not good for the reputation of bank; the delay is due to manual work. Therefore I suggest that computers and other electronic machines should be installed in bank so that time could be saved. Deficiency in managementI felt at some places the BOP need to have employees, because a lot of work is to be done by a single employee that will result in work overload and employee might not perform his/her job with full devotion.1.3.1 Communication systemCommunication Department of the Bank of the Punjab is more effective with in and out of the organization. He prepares the new Deposit Schemes of the Bank and makes the marketing strategies of these products. Then communicates these plans to all the braches of the bank. He is being assisted by Corporate Head and Corporate Head is being assisted by Regional Head. The Bank of Punjab, consumers are treated very well. They are of the opinion that customers must be satisfied with the services provided by the Bank. All of the Branches try to make sure that customers are satisfied with services being provided by the Bank.

1.3.2Hiring systemCentral office at Karachi is dealing with the appointments to different officers posts. And the central office also fills other executive posts. For certain posts the executives also have right to appoint the qualified persons. But the main criteria of appointment are by test and interviews.BOP has a criteria already prepared for the appointments of employees. The criteria involve: Academic work Extra curricular activities Working experience.

The candidates must be the citizens of Pakistan and the state of Jammu and Kashmir should not be more than 25 and less than 18. However in certain cases the age can be relaxed. Normally the citizen for under developed areas of Pakistan has the age relaxation. The executives also have the power to employ an over age person etc.3.3.3 Morale of staffGood relationship among staff member leads to the peak performances in any organization. I observed that the staff relationship was normal other wise but some time I noticed that there exists little conformity among the staff members. The morale of staff is high incasing of dealing with co-workers, with customers, subordinates and also with other branch members and head office. They can also improve the morale of staff by giving bonuses and other benefits.3.3.4 Physical FacilitiesBank provides the facilities to their employees. In jalalpurjattan branch there is separate room for branch manager and also a big hall in which separate cabins for each worker like cashier, operation manager etc. There is facility of kitchen for staff refreshment and lounge for visitors. The facility fo electricity, water etc is also available in the branch.3.4 Performance Customer focusOver the years BOP has developed strong relationships with its customers by understanding their needs and treating them with respect, dignity and importance. The driving force behind its commitment and services is its focus on customers, ensuring that it not only meets, but exceeds their expectations. Quest for QualityBOP strives to achieve excellence by ensuring that every moment of out times is spent in adding value, making sure that we do things rights, first time, and every time. With this quest for quality, BOP has always taken initiatives in bringing banking into a new arena; from cash to the convenience of plastic; from branch banking to internet banking and from face-to-face customer interaction to online accessibility. Employees RespectBOP encourages diversity and treats each of our employees with fairness. BOP gives constructive feedback for their continuous development and seeks suggestions from all employees for further improvement. The bank ensures that quality performance is acknowledged and rewarded and exercise utmost responsibility in decision-making with regards to our employees. Team Based ApproachBOP believes in achieving its Mission and Vision by working together as a combined group. BOP treats its employees as its internal customers and ensures that the requirements of internal customer focus are always met. Equipped with in-depth product knowledge, and recognizing the strengths in each individual, the bank strives for optimum-results from our co-workers and bringing out peak Performances by working towards common goals and objectives in todays dynamic banking environment. Good Corporate CitizenshipBOP seeks to continuously improve the quality of life in our communities. The bank realizes that it has a responsibility to the society in which it operates and it seeks ways of playing a positive role for the betterment of the community at large for a progressive environment, better living and a brighter future.3.5SummaryThe end of the chapter there is a complete introduction of the Bank of Punjab Kutachary Road Branch has given. Chapter three is all about how the branch is working. In this chapter it is described that how the head office communicates to the branches. What are the communication channels in branch itself? Details of different departments working in branch are also given. Details of offices and field offices are also given. Other head contains data regarding the current staff of BOP. Details of qualifications and experience of employees is also given. Training of employees, their workload, salary structure, promotion system, incentive and motivation of employees is also the part of the system. Morale of employees is necessary to increase. Physical facilities have their necessary to describe. Then performance and output is measured not only in terms of customer satisfaction but also in terms of account holders, employees, etc

Chapter#4IntroductionThis chapter is related to organization rules and regulations which are adopted by its branches in order to meet the desired goals. Branch office use the policies made by head office and set strategies on the base of these policies and get success through this strategies. This chapter includes Policies, strategies, and successes. I discussed all these elements in detail. At the end the summary of this chapter is given.4.1 PoliciesThe function of board in making policies are: Policy formation. Management of bank. (All branches) Statement of ethics and business practices. Corporate strategy. Others functions. POLICY FORMATION:For policy formation, directors meet once a month. In the meeting policies of the last month are usually discussed. If there is a need of review, then the directors have he right to do that, but collectively. MANAGEMENT OF BANK:In this the board discussion about the management of all the branches, performance of the managers of each branch is discussed individually. On the basis of the performance, it is decided whether a branch manager deserves a reward of his performance or he must be punished because of his negligence.Different departments in The Bank of Punjab perform different functions. There are department lie shares; customer, credit and they have their respective functions.Administration department only interferes at the time where there is a problem about the staff. In the branches, every manager has a direct link with his sub-ordinates. The branch manager assigns employees of the bank a particular job. Usually there is job rotation is avoiding the difficulties at the time of absence of any employee. The Board of directors or higher management sets goals to the managers or middle and lower level of management. The task specifies not only what is to be done, but also how it is to be done and exact time allowed of doing it. The board consisting of ten directors and a managing director interviews managers and upper level management. STATEMENT OF ETHICS AND BUSINESS PRACTICES:Statement of ethics and business practices is prepared and circulated annually by the board of directions in order to establish a standard of conduct for directors and employees, which statement shall be signed by each director and employee in acknowledgement of his understanding and acceptance of standard of conduct.4.2Strategies CORPORATE STRATEGY:The board of directors adopt a vision/mission statement and overall corporate strategy for the listed company and also formulate significant policies, having regard to the level of materiality, as may be determined it. OTHER FUNCTIONS: The board of directors also performs the following important function: Risk management Human resource management including preparation of a succession plan Procurement oft goods services Marketing Determination of terms of credit and discount to customers Write-off of bad/doubtful debts, advances and receivables Acquisition/disposal of fixed assets Investment Determination and delegation of financial powers Health, safety and environment Borrowings of money and the amount in excess of which borrowing shall be sanctioned by a general meeting of shareholders Donations, charities, contributions and other payments of a similar nature.SuccessTo be competitive the Bank has further reinforced its position in the Consumer Banking arena by streamlining and re-launching the consumer financing products and introducing more convenience based solutions. With the re-launch of auto finance and house finance products, the Bank pushed the products with full thrust. The Bank also launched a running finance facility against mortgage of property.Technology continued to play an important role in improving and expanding product offerings. The Bank introduced more IT based products to cater to the changing lifestyles and needs of the customers. BOPs operations continued to be streamlined with focus on rationalization of expenses, re-alignment of back-end processing to increase productivity, enhancement of customer service standards, process efficiency and controls. The Banks has taken the lead in introducing the innovative concept of centralizing Trade Services in the country by providing centralized foreign trade services to branches with a view to improve efficiency, expertise and reduce delivery cost.Management of Human Resources has been one of our core focus areas. BOP is committed towards attracting, retaining and motivating outstanding people. Challenge for BOP is to provide an environment in which employees can better realize their potential. The Bank introduced reward for performance where high potential officers were identified and rewarded accordingly. In view of the competitive environment, the Bank is focusing on performance and introducing a more robust performance management system. BOP is also strongly committed to training its staff at all levels.4.4 SummaryThe summary of the chapter includes following details about policies, strategies, successes and introduction. What are the policies of organization which are adopted by branch in order to set strategies and to meet desired objectives mentioned in this chapter details about the successes achieved by organization by implementing strategies are also mentioned.Chapter # 5INTRODUCTIONThis is the fifth and last chapter of my internship report. In this chapter the focus of my study is on the different types of analysis. This chapter includes SWOT analysis and PEST analysis. SWOT analysis that stands for strengths, weaknesses, opportunities, ad threats. SWOT analysis is careful evaluation of an organizations internal strengths and weakness as well as its environment opportunities and threats.PEST analysis stands for Political, Economic, Social, and Technological analysis and describes a framework of macro-environmental factors used in the environmental scanning component of strategic management. I explained these two types o f analysis in detail. At the end the summary of this chapter is given.5.1Swot AnalysisSWOT analysis is an acronym that stands for strengths, weakness, opportunities, and threats SWOT analysis is careful evaluation of an organizations internal strengths and weakness as well as its environment opportunities and threats.SWOT analysis is a situational which includes strengths, weaknesses, opportunities and threats that affect organizational performance. The overall evaluation of a company strengths, weaknesses, opportunities and threats is called SWOT analysis.In SWOT analysis the best strategies accomplish an organizations mission by: Exploiting an organizations opportunities and strength. Neutralizing it threats. Avoiding or correcting its weakness.SWOT analysis is one of the most important steps in formulating strategy using the organization mission as a context; managers assess internal strengths distinctive competencies and weakness and external opportunities and threats. The goal is to then develop good strategies and exploit opportunities and strengths neutralize threats and avoid weaknesses.5.1.1 STRENGTH The Bank officers of BOP are considered as one of the most able professionals in the banking world. In my observation that they interact with their clients as if they are their personal friends and discuss about their problems as their own. As a result of the compassionate and personalized services of the officers, the clients perception for BOP is very high. They have trust and feel themselves to be secure while dealing with BOP. BOP has got a reliable and easy to use internal computer system. Every information regarding the transactions in customers deposits has been computerized. Data are properly maintained. Good security system. Not excellent but good facilities are given to employees.5.1.2 WEAKNESSES Lack of proper internal controls is one of the major weaknesses of BOP. It is also pointed by the auditor in his review. BOP has formulized a lot of products and services for its customers, even more than other commercial banks, but any advertisement on electronic media has not been seen. I observed during my internship that some of the employees were burdened with over work. So I think that the work should be distributed according to their post and capabilities. Biased selection of employees.5.1.3 OPPORTUNITIES Satisfy dynamic consumer needs, BOP has made significant in roads in its entire service spectrum. A lot of products have been introduced especially in Retail Banking (Agriculture side) and people are increasingly becoming loyal to the bank and because of feasible transactions. Optimum pricing and branding strategies of the bank are helping to make customer feel secure and convenient. All the opportunities of the 21st century are to be availed in the information technology.Information technology is the future of this dynamic world. Therefore BOP should emphasize much on IT, especially on E-Banking. Bank can design a universal account like other foreign banks, to enhance online facilities. BOP has introduced a number of financial schemes including special Deposit Account. These accounts have their unique features. During the last three years, BOP deposits have been increasing @ 40%, which is a very healthy sign. Therefore, with the commencement of new schemes there can even be a greater increase in its deposits.5.1.4 THREATS Despite the difficult circumstances that confronted the banking sector in particular and the country in general, BOP has been still highly profitable. But, the facts cant be denied and there might be an adverse impact of such situation. BOP is facing a strong competition by its competitors, Business of all these Banks are growing at very high pace.

5.2Pest analysisPolitical/Legal EnvironmentThe political environment for BOP has been very conducive so far. But as it is clear that the political instability affects the operations of any institution so it also has an effect on the working of BOP.The September 11 attacks and frequent terrorism in Pakistan are major reasons of the political instability in the country. The Afghan war and Pakistan being the front line state, has lessened foreign investments and remittances.Economic EnvironmentThe economic situation in Pakistan is not so good and mostly there is depression in the economy. High inflationary rates and international reversionary trends have shown a negative impact on our economy. These things make the investor more reluctant in investing his money.Social EnvironmentPeople usually dont have the right information about the products and services that the banks are offering them. Secondly there is a culture of distrust between the borrower and the lender, people hesitate to deal with the banks due to their complicated and lengthy procedures, also due to the fear of higher interest rated. BOP has been successful in maintaining its goodwill in the society.Technological Environment As the world is coming closer and closer day-by-day, new and innovative technologies are being introduced in the market. The educated customers of the 21st century are more aware of their needs as they were some years back. Keeping these things in mind, BOP has always worked and is still working to enhance its technology in order to provide its customers a better service to its customers. M-NET and online banking services are the examples of the policies of BOP made for the customer service.

5.3SummaryThe summary of this chapter includes details regarding analysis of organization. This is the end of chapter five. In this chapter SWOT and pest analysis are mentioned. SWOT analysis that stands for strengths, weakness, opportunities, and threats SWOT analysis is careful evaluation of an organizations internal strengths and weakness as well as its environment opportunities and threats PEST analysis stands for Political, Economic, Social, and Technological analysis and describes a framework of macro-environmental factors used in the environmental scanningcomponent of strategic management all these are mentioned in detail in above chapter.Chapter # 6RecommendationsAfter doing a deep study I am able to recommend so following are my recommendation: ATM machine must be installed so that increases the income of branch. Improvement in the salary package On the bases of performance reward should be assigned. Lack of staff there are only two employees in cash counter so it must be four person to proper handling of cash because of heavy rush for the payment of utility bill and salary so two employee must handle utility bills. Third on receives receipts and forth employee performs all the payments. In this way easily manage all tasks of cash. To retain customer, bank should adopt competitive rates for its services. Branch should focus on the consumer banking as will because its a good source of income to branch. Transfer is not properly carried out. Some of the employees are continually serving at the same post. They are simply rotated at the same branch. Therefore it is recommended that evenly rotation of every employee should take place after every three years in different braches of the bank. BOP should start its operation in credit card. These cards are very helpful for the ordinary customer in general and the business people in particular. To make it mores secure and to eliminate the misuse of it, the management is required to keep proper security against the card. There should be an information desk to provide the information and to receive the complaints of the customer in the bank. There is no complaint box available in the branch and not any person appointed to hear the complaints. Every person cannot go to the manager for the complaint because most of the people are hesitant. So I suggest management to install a complaint box in the branch, and recruit a special person for that guidance of the customer when they are unable to manage some difficulties in banking matters. BOP staff lacks professionalism. They lack the necessary training to do the job efficiently and properly. Although staff colleges are in all major cities of the Punjab but they are not performing well. For this purpose these staff colleges should be reorganized and their syllabus should be made in such a way which can help the employee understand the ever-changing global economic scenario.Banking council of Pakistan should also initiate some programs to equip the staff with much needed professional training.

ConclusionsFinally I conclude that due to the cooperation of all branch members I have been able to learn many new things related to banking sector, I was able to run the day end successfully at the end of each day, plus arranging all the vouchers, maintaining record of branch, filling account opening form of customers and handle other tasks as well.By analysis the financial statements of the bank, I came across to know that it is one of the most growing banks in the subcontinent. Now they should carry on with the present management which too k it from one of the ordinary bank to this level. No doubt professionalism and internal controls of the bank are one of the major issues which may results some major losses to the bank Bias in hirings and between colleagues should be remove.THE BANK OF PUNJAB is a good Organization in the way that any body can join it for his/her long-term career. Overall working environment is comfortable. Management is very strong and above that its a government bank.

References Sami UllahNazAwan Branch ManagerArshad Operational Manger Munir Ahmad Cash Officer

www.google.comhttp://www.bop.com.pk/Financial/AnnualAccount.aspxwww.sbp.com.pkwww.bop.com.pkhttp://www.antiessays.com/free-essays/74909.html

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