Internship Report on UBL

SECTION 1

PIONEER OF BANKING

Banking starts after the innovation of coin. So, the pioneer of banking is goldsmith. History of banking is traced to 2000 B.C in Greece. So, Priests and goldsmiths acted as financial agents by keeping money and valuables of people in temples in strong safes. Thus the first stage in the development of modern banking was accepting of deposits of cash from those who had surplus money with them.

 

CONCEPT AND MEANING OF BANKING

It has not so far been decided as the how word "Bank" originated. Some authors opine that this word is derived from the words "Brancus" or "Branque' which mean a branch. The explanation of this origin is attributed to the fact that the Jews in Lombardy transacted and business of money exchange on branches in the market place, and the business failed; the people destroyed the "Banco".

Other authorities hold the opinion that the word "Bank" is derived from the German word "Back" which means, "Joint stock fund".Later on, when the German word "Back" was initiated in the "Bank".

 

ACCORDING TO GILBERTS

"A banker is dealer in money."

 

BANKING COMPANIES ORDINANCE 1962

"Banking means the accepting for the purpose of lending or investing of deposits of money from the public repayable in demand of otherwise and withdrawable by cheques, draft order or otherwise."

 

 

 

EARLY GROWTH & DEVELOPMENT OF BANKING

Importance of money as a medium of exchange and necessity of controlling it was realized since primitive as human society "Babylonian" were the first to develop banking system as early as 2000 B.C. During the middle of 12th century banking spread in different European countries particularly in Italy and the bank of Barcelona" in 1407, "Bank of Geneva" in 1409, "Bank of England" was founded in England in 1694. All these were public banks and their principle functions were dealing with foreign exchange.

Technically speaking, financial institutions (Banks) are the commercial banks. Commercial banks have been called the department stores of financial institutions, which instead of specializing in one area offer services in many areas. Such as borrowing, raising, are taking up of money, and lending or advancing of money either upon or without security the drawing making, excepting discounting, buying, selling, collection and dealing in bills of exchange, promissory notes, drafts, scripts, and other instruments and securities whether transferable or negotiable or not the granting and issuing of letters of credits, traveler's Cheque and circular notes, selling of foreign exchange including

foreign bank notes, the acquiring, holding, issuing of commission, under writing and dealing in stock, funds, shares debentures, bonds , obligation securities and investments of all kinds the negotiating of loans and advances the providing of safe deposit vaults the collecting and transmitting of money and securities, carrying own and transacting every kinks of guarantee and indemnity business.

 

OVERALL BANKING SECTOR IN PAKISTAN

At the time of independence, the area which now make Pakistan were producing only food, grain and agriculture raw material for Indo-Pakistan Sub-continent. There were practically no industries and whatever raw material was produced was being exported from Pakistan. However, commercial banking facilities were provided fairly well here. There were 487 offices of scheduled banks in Pakistan.

 

 

As Pakistan was the new country having fewer resources, it was very difficult for it to run its own banking system immediately. Therefore, in accordance with the provision of

Indian independence Act of 1947 an expert committee was appointed to study the issue. The committee recommended that The
Reserve Bank of India should continue to function in Pakistan until 30th September 1948.So, that the problem of time and demand liability, coinage, currencies, exchange etc., be settled between India and Pakistan. By 30th June 1948, the number of offices of scheduled banks in Pakistan decreased from 487 to 195.In order to broaden the scope of banking system in Pakistan. State Bank also allowed sponsoring the establishment of specialized credit institutions in the fields of agriculture and industry. At the end of June 1958, after ten years of the establishment of SBP, the number of branches of Pakistani Banks increased from 195 to 307.

The following figures reflect the rapid development of banking system in Pakistan from 1948 to 1958:

	1948	1958	% Increase
Bank Deposits	880 Million	2,390 Million	172%
Bank Credit	190 Million	1,223 Million	544%

 

During the five years 1960-65, the number of scheduled bank branches increased from 430 to 1591. Two new banks were added to the list of scheduled banks. These were commerce bank and standard bank. A significant change in Pakistan banking system took place when government of Pakistan nationalized all commercial banks incorporated in Pakistan on 1st January 1974. There were 22 scheduled banks and 3,525 branches at the end of December 1973.

The nationalization of the banks in Pakistan has announced a new era of development and progress. The commercial banks were nationalized in January 1974, under the Banks nationalization Act 1974. The nationalized banks included Habib Bank, United Bank, Allied Bank, Muslim Commercial Band and National Bank. Besides these Nationalized Commercial Banks (NCB), there are some other Foreign Commercial Banks in the private sector operating in Pakistan like City Bank, ANZA Grind lays Bank etc. These Foreign Banks are the administrative control of State Bank.

 

The Federal Government also setup the Pakistan Banking Council (PBC) on 2 March 1974 under the Bank Nationalization Act of 1974. It reports directly to the Ministry of finance and provides support and advice to the State Bank, its responsibilities include:

Evaluate performance of NCBs according tot the criteria laid down by the PBC and Socio economic objectives set by SBP.

1. 
   
   Policy Guidelines to NCBs.

1. 
   
   Policy recommendation to the Federal Government.
2. 
   
   Appointment of senior staff and training within the NCBs.
3. 
   
   Annual inspection of NCBs.
4. 
   
   Grand approval to NCBs to write off loans exceeding Rs.25, 000,000/

After the nationalization of banking, the Interest Free Banking system is introduced in Pakistan with effect from January 1981. The essential principle of Islamic banking is profit and loss sharing (PLS) and the banks started bearing (NIB) Finance.

The banks are categorizes in the below case.

DESCRIPTION	NO. OF BANKS
Nationalized commercial banks	3
Privatized commercial banks	18
Public sector specialized banks	4
Foreign banks	21
Total schedule banks	46

   

Other Categories

1. 11 Development Financial Institutes.
   
2. 16 Investment Banks.
   
3. 21 Leasing & Modaraba companies.
   

 

SECTION 2

UNITED BANK LIMITED

UBL has assets of over Rs. 380 billion and a solid track record of forty seven years. In addition to the convenience with over 1400 domestic branches all over Pakistan and 19 overseas branches UBL is one of the largest banks in Pakistan.

BOARD OF DIRECTORS

Shaikh Nahayan Mubarak Al Nahayan

Chairman

Sir Muhammad Anwer Pervaz, OBE

Deputy Chairman

Mr. Omer Z. Al Askari

Director

Mr.Zameer Muhammad Choudrey

Director

Mr. Ahmad Waqar

Director

Dr. Ashfaque Hasan Khan

Director

Mr. Abdul Rauf Malik

Director

Mr. Asif R. Bokhari

Pressident and CEO

 

 

 

 

 

 

 

AUDIT COMMITTEE

Mr. Zameer Muhammad Choudrey

Chairman

Mr. Omer Z. Al Askari

Mr.Abdul Rauf Malik

Members

Mr. Aqeel Ahmad Nasir

Secretary

 

SHARE REGISTRAR

M/s. THK Associates (pvt) Limited.

Ground Floor, State Life Building No. 3.

Dr. Ziauddin Ahmad Road, Karachi, Pakistan.

 

AUDITORS

A.F. Ferguson & Company

Chartered Accountants

KPMG Taseer Hadi & Company

Chartered Accountants

BRANCHES

1056 Domestic, 15 Overseas Branches

 

HEAD OFFICE

State Life Insurance Corp. Building #1,

I.I. Chundrigar Road, Karachi, Pakistan

P.O. Box No.: 4306

Phone: (92-21) 111-825-111

Gram: "UNITED"

Fax: (92-21) 2413492

 

BRIEF HISTORY OF UBL

Saigol group established UBL on November 07, 1959 and Agha Hassan was the founder as well as its first president. The establishment of UBL brings new banking era in Pakistan. From its starting days, UBL has been playing a major role in promoting banking in Pakistan. Its excellent banking style bring revolution in this sector and the financial results started growing. As a result in few years UBL broke all the pervious growth records. In 1974 with all other banks, the government nationalized UBL. Since then it has been serving, as government owned bank. UBL has always endeavored to give the most efficient services to its clients. It was due to the appreciation of its services by its clients that the UBL grew rapidly and became the second giant Pakistani bank in 1977. It regained its second position by a wide margin in July 1983, but in the years after 1983, bank had changed its approach by increasing its staff and branches to gain an edge over competitors. As a consequence of this strategy, the performance of bank effected badly and the bank suffered some serious problems, e.g., overstaffing, high operating expenses lack of control over resources, default of loans, etc.

 

To stabilize the situation, Zubair I. Soomro took over the charge of UBL as president in July 1997. During this assignment as UBL's president, he played a pivotal role in turning bank around and made it able to start operating profits. He has also taken step toward right sizing of employees and shut down of non-profitable branches. Therefore, we can say alterations dovetail into the remarkable come bank of UBL.

After some time in the year 2002 brought new challenges and achievements for the UBL, dominated by the events like privatization. According to which on 19 Oct, 2002, the government of Pakistan sold 51% of its share. Two companies consortium of Abu Dhabi group (UAE) and Best Way Group bought the major portions of the UBL.

 

 

MISSION

"UBL Bank's team of committed professionals is dedicated to maintaining long term customer relationships through outstanding service and convenience."

 

VISION

UBL is "A World Class Bank Where You Come First"

 

VALUES

 

1. 
   
   Innovation and growth
   
2. 
   
   Social responsibility
   
3. 
   
   Integrity
   
4. 
   
   Excellence In service
   
5. 
   
   Teamwork
   
6. 
   
   Customer focus
   
7. 
   
   Trust
   

MANAGEMENT HIERARCHY

UBL divided its management into three basic levels 1. Top Management 2. Middle Level Management 3. Lower Level Management which is explain into the following ground.

 

SECTION 3

PRODUCTS AND SERVICES

Almost all the commercial banks, operarating in Pakistan provide the same products and services at different methodologies and different customer attraction but some banks have different products and services.

UBL has taken progressive steps and has introduced innovative products and services to provide you a variety of banking and financing services.

 

1. 
   
   REMITTANCES
   
2. 
   
   loans
   
3. 
   
   UBL WALLET
   
4. 
   
   UBL E-STATEMENT
   
5. 
   
   deposits
   
6. 
   
   ublameen

 

1. REMITTANCES

UBL remittance products are designed to give maximum flexibility.

The following are the remittances products and services.

 

1.1. TezRaftaar

Free Doorstep Remittances within the country or from abroad, UBL offers the most efficient and price competitive service. With our large network of branches, we are poised to offer you service almost at your door step.

UBL's new remittance service, TezRaftaar offers all overseas Pakistanis the fastest and the most convenient delivery of their money to their beneficiaries in Pakistan. Best of all,

TezRaftaar is completely cost free and is available at all UBL branches along the Bank's Network in the Middle East, UK and US.

 

1.1.1. Check out it's great benefits

1. 
   
   Fastest delivery to given address in Pakistan.
2. 
   

   Doorstep delivery by authorized courier or credited to the recipient's account.
   

3. 
   
   Free of charge transfer service.
4. 
   

   Open to all including those who are not UBL account holders.
   

5. 
   

   Complete reliability of transaction.
   

6. 
   
   Make delivery within 24 hours, may be slightly longer for remote areas.

 

1.2. Hamrah

UBL Now Offering Denominations up to Rs. 10,000. UBL has always been at the forefront in identifying and meeting the financial needs of its valued customers. UBL was the pioneer in introducing Rupee Travellers Cheque facility in Pakistan, as early as 1971. In continuation of the same tradition, UBL in the shape of "Hamrah" Rupee Travellers Cheque enhances this facility for the convenience of its valued customers by offering denominations up to Rs. 10,000. UBL "Hamrah" has been designed keeping in mind, both convenience and security. For business, property, trade or personal needs. "Hamrah" Rupee Traveller Cheques are the ideal and safest way of carrying cash when travelling anywhere in Pakistan. Hamrah RTC's are now accepted at more than 2000 places such as hotels, shops, real estate agents, jewelers, car dealers, etc and of course at all our UBL branches. UBL has a 24-Hours customer help-line, providing its customers with round the clocktele- erification of "HAMRAH" traveler's cheques.

Salient Features

Absolutely free, no bank commission, no excise duty, whatever the value of "Hamrah" purchased, no bank commission or excise duty will be charged.

Denominations   

Available in denominations of Rs. 10,000 and Rs. 5,000.

 

Easily transferable and encashable

At any of the large network of designated UBL Branches, countrywide. Transferable/encashable through a single signature.

 

Available to all

Holding an account with UBL not mandatory for availing this facility.

 

Ease of immediate assistance in case of loss or theft

Just dial "Hamrah" Hotline UAN for assistance 111-111-825 or contact nearest designated UBL Branch.

 

Special facility of refund

Indicate choice of designated UBL Branch for refund which will be within days only. Most convenient while in transit anywhere in Pakistan

 

Valid until encashed

Use them for a week, month or even years depending on when there's a need for encashment.

 

Exclusive security

Secured with specially "Coded" printing and "rain bow effect" for added security.

1.3. UBL Click N Remit

For US residents, UBL offers added flexibility through UBL Click N Remit. An innovative online remittance service. Sending money from US to Pakistan is just a click away.

 

 

 

 

 

2. LOANS

SMALL BUSINESS SCHEME

UBL MONEY

UBL CASHLINE

AGRICULTURAL LOANS

UBL ADDRESS

UBL DRIVE

 

1. SMALL BUSINESS SCHEME

Under the Small Business Scheme, UBL is providing loans on easy terms to those who wish to set up their own small-scale business. This scheme is aimed at spreading prosperity in the country by reducing unemployment.

As more and more people start their own industrial units, the country will move steadily towards economic self-reliance.

 

2. UBL MONEY

UBL Money, the Personal Installment Loan from UBL provides with power, control, convenience and the flexibility to manage the financial requirements and realize dreams.

UBL Money is a fixed installment loan. It gives access to funds starting from Rs. 50,000/- up to a maximum of Rs. 500,000/- without any collateral. UBL Money provides the flexibility to manage monthly installments according to income stream. Selection made any tenor from 1 to 5 years in the multiple of 6 months. UBL money will be delivered to desired in the quickest possible time.

 

1. 
   
   Zero-prepayment penalty option
2. 
   
   Complimentary Credit Insurance
3. 
   
   Competitive mark up

 

 

 

Uses of UBL Money

1. 
   
   Pay off credit card balance
2. 
   
   Finance child's education
3. 
   
   Buy home accessories
4. 
   
   Finance vacations
5. 
   
   Buy anything that wish

 

3. UBL CASHLINE    

UBL introduces Cashline the most flexible loan, providing up to Rs. 500,000/-

 

3.1 FLEXIBLE

UBL Cashline is truly the most flexible loan that gives the freedom to turn dreams into reality today. Unlike ordinary personal loans, UBL Cashline has No Pre-payment Penalty.

 

3.2 FACILITIES

1. 
   
   UBL Cashline can pay bills on behalf of customers.
2. 
   
   UBL Cashline can buy appliances for customers.
3. 
   
   In short UBL Cashline can fly customers.
   

 

3.3 CONVENIENT

UBL Cashline gives the convenience of access to cash through multiple options 24 hours a day, truly setting you free.

 

3.4 Cheque Book

Use UBL Cashline cheques at any online branch throughout the UBL network. Customers can enjoy the convenience of walking into any UBL online branch across Pakistan and use Cashline account with ease.

 

 

 

3.5 ATM/Debit Card

UBL Cashline comes with an ATM/Debit card so that customers have instant access to cash 24 hours a day, 7 days a week.

 

3.6 Online Bill Payments

Pay Bills online to a growing list of billers. UBL Cashline offers the convenience to pay Mobilink Indigo, Paktel & Instaphone Bills online.

 

3.7 Balance Transfer Facility

Customers will have convenience at their own fingertips with UBL Cashline. Customer can now transfer outstanding debts to UBL Cashline through a simple Cashline cheque in favor of any other institution, thus paying off your debts at a lower mark up.

 

4. AGRICULTURAL LOANS

UBL's agricultural loans on easy terms and conditions to small scale land owning farmers boost the country's economy and yield greener harvests. UBL enables farmers to buy good quality seeds, fertilizers, pesticides and agricultural implements. Through the Government's Loan Schemes for Haris, UBL lets your crops prosper and your dreams materialize, making Pakistan's economy stronger.

 

5. UBL ADDRESS

Everyone always dreamt of having a permanent address. Now UBL turns the dreams into reality with UBL Address. The unique offering that makes the owner of home while remaining within limited income. UBL Address understands customer home financing needs and offers a variety of fixed, floating & adjustable rate options.

 

5.1 Floating Rate

In this option, customers get a fixed rate for a period of 12 months, that gets re-priced annually. Adjustable rate, mark-up rate will be fixed for a period of 3, 5 years, and will be adjustable after the fixed rate period.

 

6. UBL DRIVE

UBL Drive is a unique auto financing product which offers the features, options and flexibility unmatched by any other bank. UBL Drive allows customers to drive away in your own car by making a down payment of just 10% and to top that with low monthly installments.

With UBL Drive customers can buy favorite used car (up to 5 years old) at the most affordable rates. UBL Drive is not just a car loan; it's a financing facility that gives cash on car, everyone can get up to 75% of your car value. Drive in with your car and drive out with cash. UBL Drive is the quick and hassle free route to the car of choices. Offering first time in Pakistan, No down payment and processing charges till your application is approved. After approval, you can take your Purchase Order to any of our authorized dealers, pay the total cash outlay amount and simply drive away with your preferred car.

 

ONLINE BANKING

With UBL's state of the art online banking, you can access your account from more than 350 branches located in 71 cities across Pakistan. Your account gets to travel with you and can be accessed throughout Pakistan, be it Karachi, Kotli Main, Nalka Kohla or Mandara. Now UBL enables you to do all the following transactions in minutes through designated online branches. Salient features of online banking are:

 

1. 
   
   Cash Deposit
2. 
   
   Cheque Encashment
3. 
   
   Stop Payment
4. 
   
   Account Statement
5. 
   
   Funds Transfer

 

 

 

 

UBL WALLET

UBL introducing the Wallet Card, now with the International power of UBL wallet. Now with the power and international acceptance of VISA, Wallet VISA ATM & Debit Card has all the convenience and security to desire and the quality to deserve. This Wallet holds all the cash in bank account.

 

Available to All UBL Account Holders

UBL offers ATM and Debit Card facility to all account holders at all UBL branches anywhere in Pakistan, regardless of whether their branch is online or offline.

 

UBL Wallet Your ATM Card

UBL already has its own network of 214 ATMs in 60 cities, which continues to expand by the day. Moreover, UBL Wallet is now part of the 1 Link and VISA networks. These allow you to use your UBL Wallet VISA across Pakistan at more than 925 ATMs.

 

Displaying the 1 Link logo and at more than 900,000 ATMs in 150 countries. It is also acceptable on the network of ATMs in Pakistan. Your Wallet visa card will also be acceptable on all local VISA certified machines displaying the visa Plus sign. With UBL wallet visa as debit card, you can shop all you want, eat all you can or fill up your car tank without carrying any cash. Simply use your UBL Wallet visa for direct debit from your bank account, along with the convenience of using signature based verification instead of a pin(Personal Identification Number).

 

UBL INTER BANK FUNDS TRANSFER

UBL Inter Bank Funds Transfer instantly transfers funds through UBL ATMs.

UBL launches its Inter Bank Funds Transfer facility, another proud addition to our wide array of convenient and cutting edge services for our wallet card holders, and gives yet another convincing reason for our customers to have a wallet ATM / debit card.

 

 

The UBL Inter Bank Funds Transfer (IBFT) Service is being offered through the wide network of UBL ATMs to enable transfer of funds between participating 1 link member banks, and all participating bank ATM / debit card holders shall be eligible for the service.

 

UBL E-STATEMENT

UBL brings a simple solution to all problems by introducing the UBL e-statements facility. UBL is pleased to announce the launch of the UBL e-statement facility which makes it easier to get statement of accounts and automated transactional debit/ credit alerts right into your inbox.Available for all Rupee and Foreign Currency Account holders. Now do not have to wait for six months to receive a paper based statement of account any more. Absolutely free of cost: you don't need to pay any additional cost in order to get benefit from this facility. UBL believes in providing value-added service to customers.

Receive bill statements according to needs: UBL e-statement can be delivered to you in the following frequencies;

 

1. 
   
   Daily
2. 
   
   Weekly
3. 
   
   Monthly
4. 
   
   Quarterly
5. 
   
   Semi annually

 

Automated transactional debit/ credit alerts: whenever there is an activity in account, an email shall be sent with the complete transaction details.

 

UTILITY BILLS COLLECTION

1. 
   
   UBL has over 1000 branches collecting electricity, gas,
   telephone and
   other utility bills during business hours.
   

 

1. 
   
   Special bills collection counter in every bank.
   
2. 
   
   Separate booths for utility bill collection are available at all
   major cities
   for the convenience of the public.
   
3. 
   
   Branches in all major cities have electronic bill collection machines.
4. 
   
   For your convenience, UBL accepts cheques for payment of utility bills.
5. 
   
   Drop box facility.

LOCKER FACILITY

UBL provides locker facilities to its valued customers at very reasonable charges.

 

HAJ AND UMRA SERVICES

According to Policy for Hajj 1424 Hijri (2004 A.D.) Sponsorship Scheme has been merged into the Regular Scheme. Intending Hajjis in this Scheme can operate for government accommodation or for private accommodation. All the pilgrims under Regular Scheme will deposit full amount of Hajj dues in Pak Rupees along with the Hajj

 

Applications Forms. This year 120,000 pilgrims will be allowed to perform Hajj under Regular Hajj Scheme.

UNI-REMOTE

Uni remote system is designed to perform transactions between any two UBL Branches over WAN (Wide Area Network) with the assurance that the information will be secured by taking security measures like VPN, encryption etc. Uniremote is not in direct access of the customer but it is the system between branches where they can make online transactions with each other on behalf of UBL customer. All UBL online branches on WAN will handle the Uniremote operations. Customers can make transaction from any of the selected online branch in any city.  

 

Transactions of staff members and few internal transactions are being done to test the robustness of the system. This system is integrated with Unibank. Transactions / facilities presently permitted in Uniremote are as follows: 

1. 
   
   Cash Deposit.
2. 
   
   Cheque Encashment.
3. 
   
   Stop Payment.
4. 
   
   Account Statement.
5. 
   
   Funds Transfer (Account to account / IBCA).

 

System architecture

Uniremote system is integrated with Unibank but its architecture is flexible enough to function as a stand-alone system. Uniremote system architecture comprises of three main components, which are as follows:

1. 
   
   Uniremote Cell / Controller: Controller of the system at all level.
2. 
   
   Local Branch: Any branch initiating transaction will be called Local Branch.
3. 
   
   Remote Branch:
   A branch on which the transaction is targeted is called Remote branch. A Remote branch could be an online Branch or an offline spoke (only credit transactions in offline branches).

 

Reports

Following are the main reports to be generated from the Uniremote system.

1. 
   

   Non Uniremote Customer list.
   

2. 
   
   Inward Transactions.
3. 
   
   Outward transactions.
4. 
   
   Inward stop payment.
5. 
   
   Outward stop Payment.
6. 
   
   Uniremote Customer Advices.
7. 
   
   Account statement.

 

Email

Confirmation email is generated by the Uniremote Controller, which is addressed to the remote branch (AOM) and contains details of all inward transactions. This must be counter checked against the actual transactions on Uniremote.

 

Transactions

Transactions are handled through one-window operation of Uniremote system. Tellers login in to Uniremote system and make the transaction and on other hand supervisor supervise the transaction before expiry of time limit (15 minutes).Below is the transaction matrix showing the transaction types allowed for different categories of Uniremote branches:

 

Service Point	Online Hub	Online Spoke	Offline Spoke
Online Hub	ALL	ALL	Deposits/Statement
Online Spoke	ALL	ALL	Deposits/Statement
Offline Spoke	No	No	No

An offline Spoke can remit funds using Uniremote through its online Hub

 

DEPOSITS

1. UNISAVER

UBL Unisaver account is an innovative way of serving the banking needs. Be it trade, business or personal finance, the UBL Unisaver allows maximum flexibility.

Special Features

1. 
   
   Daily Profits on daily balance.
2. 
   
   Higher returns on higher balances.
3. 
   
   Attractive rate of return.
4. 
   
   Backed by the bank awarded AAA Credit Rating.

 

2. SPECIAL NOTICE DEPOSIT

In park funds for a short term period than UBL offers Special Notice Deposit Receipts (SNDR). By parking funds in SNDR:

1. 
   
   UBL an attractive rate of return.
2. 
   
   Profit is credited to account every six months.
3. 
   
   Sake a secure investment.
4. 
   
   Option to park your funds for both 7 days and 30 days.

 

3. PLS SAVING ACCOUNT

First choose to keep a deposit in a secured savings account which also gives an attractive rate of return then UBL's pls savings Account will serve all your financial needs. By keeping deposits in UBL's pls savings provided the following services: 350 online branches In 71 cities now access account from 71 cities across Pakistan. Network is growing at an amazing pace and now avail services like cash withdrawal, payments, deposit, stop payment, acquisition of account statement and many more from more than 350 online branches.

4. FC TERM DEPOSIT

UBL provided a secured long term foreign currency investment, UBL's foreign currency term deposit receipt is a smart choice, just make an investment and see deposit grow over time by investing in UBL TDR's.

5. UBL UniFlex

UBL launch of the new UBL Uniflex PLS savings account. UBL has introduced a new checking account ideal for small investors, traders, businessmen and customers from middle income group. They can now afford an amazing rate of return plus value added benefits only available from the UBL Uniflex PLS Savings Account.

1. 
   
   Amazing rate of return.
2. 
   
   Convenience of a cheque book.
3. 
   
   Power of wallet visa ATM / debit card.
4. 
   
   Online banking facility.

 

6. TERM DEPOSIT

If you wish to make a secured long term investment, UBL's term deposit receipt is the smart choice, just make an investment and see deposit grow over time. By investing in UBL TDR's:

7. FC SAVINGS

If you wish to maintain a secured foreign currency savings account then UBL is the safest bet. By opening a UBL foreign currency savings account.

 

UBL INSURERS LIMITED

UBL Insurers Limited is a company owned by United Bank Limited (UBL) and its sponsors, Abu Dhabi and Bestway Group, set up as a strategic initiative for UBL market leadership. UBL Insurers seeks to bring banking and insurance together in offering comprehensive financial solutions for the first time in Pakistan, to better serve the existing customers of UBL as well as to bring in new business.

UBL Insurers Limited is an incorporated insurance company registered as an insurer with the Securities and Exchange Commission of Pakistan. UBL Insurers has emphasized the hiring of top of the line experienced underwriters to provide a solid operational framework to the company, as the marketing / sales arm heavily relies on the technical support of the experienced underwriters and effectively serve and attract the larger client base.

 

UBL AMEEN

UBL was awarded the Islamic banking branch license by the State Bank of Pakistan on December 16, 2006.UBL introduced the "Ameen", UBL's Islamic banking initiative and opening of our first flagship branch, located at M. A. Jinnah Road, Karachi.

UBL Ameen will offer a range of Riba-free and Shariah compliant banking products to a wider and increasingly aware customer base in the country. Following a two pronged strategy, the bank will reach out to customers through dedicated UBL Ameen Islamic banking branches as well as specialist Islamic banking counters at select UBL branches.

The launch of Ameen Islamic Banking is a significant milestone for the bank as well as a major move forward for Islamic banking in Pakistan. In view of UBL's standing as one of the largest local banks in the country, with a network of over 1000 branches and a customer base of over 2.8 million.

For its part, UBL has invested substantial resources towards the launch of Ameen Islamic banking products and has brought in its fold the best Shariah Advisory, in terms of expertise as well as experience. UBL Ameen Islamic banking products will progressively

cater to the needs of customers in the corporate, commercial and agricultural sectors as well as provide finance to SMEs and individual clients, of a standard exceeding any other bank in the country.Islamic Banking represents a great opportunity for people in Pakistan. A growing number of customers today are looking for Riba-free and Shariah-compliant banking solutions.

UBL FUND MANGER

UBL Fund Managers Ltd. previously known as the United Asset Management Company Ltd. was established in 2001. The company is a wholly owned subsidiary of United Bank Limited making it the first Asset Management Company to be launched by a bank in Pakistan. UBL Fund Managers Ltd. acquired the license to undertake asset management and investment advisory services from the Securities & Exchange Commission of Pakistan (SECP) in 2002. UBL Fund Managers (Ltd) was the first asset management company in Pakistan to voluntary undergo a rating of its own for the Funds being managed by it.. This signifies a team of qualified personnel and the management's initiatives to streamline operations. UBL Fund Managers (Ltd) works in collaboration with a large network bank which makes the task of reaching out to much easier and faster. UBL Fund Managers (Ltd) currently manages funds worth over Rs. 9 billion and out of approximately 30 Asset Management Companies in Pakistan, ranks among the top five in terms of Assets under Management (AUM). Performance and achievements in the past year are an indication of determination to become the leading asset management firm in the country. We have endeavored to give value to our investors by offering features like no load, fast redemption, nationwide free phone facility, etc. Intentions are there to offer more of such facilities. UBL Fund Managers (Ltd) is currently managing four open-end mutual funds.

 

 

UBL FUNDMANGER
PRODUCTS

UMF	United Money Market Fund.
UGIF	United Growth & Income Fund.
KIBOR	Karachi Inter bank Offer Rate - UMF: Monthly; UGIF: Average of 1 and 3 year.
PKRV	Pakistan Revaluation Rate - UMF: 16-30 Days; UGIF: 2 years.

 

UBL TREARURY

At UBL Treasury & Capital Markets (TCM), UBL nurtures a culture of delighting the customer with a complete focus on customer needs for their financial solutions. Recently TCM team's customer centric approach got a well deserved recognition when UBL was voted best in the following categories in an Asia Pacific survey of corporates and institutions by Asia money.

The UBL TCM has developed a reputation as a proven market leader in converting innovative ideas into profitable ventures for the bank and for its customers. TCM, in the last few years, has developed core competencies in the newly evolved areas of derivatives and structured solutions. Today the UBL TCM is a frontrunner in providing UBL TCM is a market maker in both the domestic money market as well as the foreign exchange market. Being one of 11 primary dealers (PD), UBL has one of the largest and strongest balance sheets amongst banks in Pakistan.

UBL was the first local bank to establish a Corporate Treasury team in the Treasury dealing room. The Global Corporate Treasury Business is responsible for sales of all structured and derivative products for UBL. The bank's trade volumes and revenues have grown significantly since the introduction of the Corporate Treasury business.

 

 

 

 

 

SECTION 4

WORK DONE & DEPARTMENT

At my first day in immamia caloni ubl branch, Lahore the bank manager, Mr. Muhammad Nawaz has introduced me with different persons and department of the bank. After that I have personally visit every department one by one and observe what is happening there. All the officials have co operate me very much and provide me information, which I needed.

 

DEPARTMENTATION

"Departmentation refers to the formal structure of an organization composed of various departments and managerial positions and their relationship to each other". Departmentation results from the division of work and the desire to obtain the organization units of measurable size and to utilize the managerial ability.

There are many departments in the banks and it is not impossible to work in all departments. during my two month internship I work in general banking like deposit department and remittances department but in spite of these departments I had also understand the working of the other departments As far as the UBL Imamia colony branch is concerned, it has divided its activities on the basis of different functions into following departments.

 

1. 
   
   DEPOSITS DEPARTMENT
   

2.    REMITTANCES DEPARTMENT

3.    BILLS DEPARTMENT

4.    CLEARING DEPARTMENT

5.    CASH CELL

6. ADVANCES DEPARTMENT

7.    FOREIGN-EXCHANGE DEPARTMENT

   
 

 

1. DEPOSIT DEPARTMENT

Banking is a service industry. The life-blood of banking is deposit without which no bank can function and earn profits. Therefore, one of the important duties of the sales staff is to sell bank liability products particularly low cost deposit i-e PLS-SB
and CD Accounts in the market.

1. 
   
   To increases the deposits of branch following efforts are made:
2. 
   
   Efficient prompts and personalized service.
3. 
   
   Personal contacts with present and prospective customer.
4. 
   
   Publicity campaigns through newspapers, electronic media and others.
5. 
   
   Deposit mobilization campaigns.
6. 
   
   Incentives/rewards for both operations and Sales Staff.
7. 
   
   New remunerative Schemes/products.

 

 

 

Function of deposit department

Providing guidance to a prospect wishing to open an account assisting them in filling forms, SS cards, cheque requisition slip and completion of their formalities. The new a/c holder is opening and operation of various types of account. Maintenance of account opened and closed register and SP/CD Reference books.

1. 
   
   Maintenance of CD/SB/NICF ledgers.
2. 
   
   Posting of cheques and vouchers.
3. 
   
   Balancing of ledgers.
4. 
   
   Applying profit/loss to PLS-SB a/cs.
5. 
   
   Marking stop payment of Cheques.
6. 
   
   Preparation of inquiry memos.
7. 
   
   Preparation, dispatch and keeping records of debit/credit balance confirmation letters on closing.
8. 
   
   Preparation, dispatch and keeping records of debit/credit balance confirmation letters on closing.

 

 

 

DEPOSIT DEPARTMENT

 

 

 

ACCOUNT OPENING CHEQUE BOOK ISSUING

DEPARTMENMT DEPARTMENT

 

 

ACCOUNT OPENING

The following types of accounts are opened by the bank:

 

1. Current Account

These accounts are opened with a minimum amount of 5000. The Bank allows no interest. The funds held in the account are payable on demand without any restriction on withdrawals. The bank normally open current account for the business need of the funds. Under this category following types of accounts are opened.

Proprietorship

This type of account are opened for business concern laying an individual as theirs sole proprietor.

Partnership

This type of account is opened for business concern having a number of partners. While opening this account care is taken to obtain the partnership deeds along with their specific instructions with regard to the operation of accounts.

A partner of firm may expel the other partners in operating the accont jointly. A letter of partnership is also obtained from all the partners so as to make them severally or jointly responsible for any liability of the concern to Bank.

 

 

Joint Stock Company

This type of account is opened for public limited company. The following documents are invariably obtained for opening the accounts.

 

1. 
   
   Memorandum and Article of Association.
2. 
   
   Certificate of incorporation.
3. 
   
   Resolution from the Board of Directors for opening the account.
4. 
   
   List of Board of Directors.
5. 
   
   Certificates of Commencement of business.

 

Societies/Club/Association

This type of account is opened for clubs, societies and association. For opening such account it is necessary to obtain copy of Bye-laws.

1. 
   
   Profit/Loss Saving Account
2. 
   
   Individual Account
3. 
   
   Joint Stock Account
4. 
   
   Checking Account
5. 
   
   Non-Checking Account
6. 
   
   PLS term Deposit

Such accounts are opened for identified period with nominal rate of mark up. For the withdrawal of these account advance notice is required. In the first category 7 days notice is required for withdrawal of investment.     In the second category advance notice of 30 days is required for withdrawal and the percentage profit for the above mention types of account. If that as may be announced by Government Annually. Acceptance of deposits on profit and loss sharing basis. In order to achieve its objectives of signalization of the banking system in the country, the Government has decided as and initial steps to authorize the banks to accept saving deposits and term deposits on profit and loss sharing basis while the existing interest base structures of deposits will remain in vogue for sometimes. These deposits will be invested in non-interested activities.

Necessary modifications have been made in the existing rule and procedure governing the above accidents that these confirm to requirement of PLS based operation. A separate counter shall be opened in each branch for accepting deposits on profit & loss sharing basis.

 

ACCOUNT CLOSING

1. 
   
   The request for closing of account is obtained in writing.
2. 
   
   Signatures of account holder are verified.

1. 
   
   Ledger keeper with his initials writes the outstanding balance in the account on the letter.
2. 
   
   The letter is forwarded to the Manager for his approval.
   1. 
      
      The Manager gives his approval and also writes the incidental charges to be recovered from the accounts holder i.e. Rs 5 in C.D and Rs 2 PLS Account.
   2. 
      
      The unused cheques leaves are destroyed, serial number of which is already mentioned on the letter.
   3. 
      
      The S.S Card is taken out and is cancelled by affixing account closed stamp
   4. 
      
      The entry is made in account opened and closed register in red ink.

 

Dormant accounts

Current accounts not operated for 6 months and saving account not operated for three years, shall be classified and in-operative accounts.

Unclaimed deposits accounts

Bank Drafts, T.Ts, Payment Orders and M.T outstanding for 3 years should be transferred to unclaimed deposit accounts to be opened in current ledger for this purpose.

Procedure for opening an account

The opening of an account is the establishment of customer-banker relationship. By opening an account at a bank a person becomes a 'customer' of the bank.

When a customer wants to open an account, he comes to the bank; the bank officer gives him an account opening form. The customer fills the account opening form.

The previously used Account Opening Form for Current, Profit & Loss sharing systems and TDRs etc; have now been consolidated into Account Opening Form. The contents of the account opening forms are as under:

 

1. 
   
   Account Number and Date.
2. 
   
   Name of the Branch.
3. 
   
   Type of Account.
4. 
   
   Nature of Account.
5. 
   
   Currency.
6. 
   
   Particulars of Deposit.
7. 
   
   Particulars of Account.
8. 
   
   Operational Instructions.
9. 
   
   Special Instructions.
10. 
    
    Zakat Deduction.
11. 
    
    Details of other Bank Accounts.
12. 
    
    Personal Information. ( phone number, email, mobile number etc)
13. 
    
    Initial amount he want to deposit.
14. 
    
    Name of other person to whom bank can contact when the person will not available.
15. 
    
    Introducer.
16. 
    
    Authorized Signature.

Before providing the AOF the banker make a preliminary introduction of the customer and know the reason for opening the account. After that banker gets Copy of ID card and also check the original ID card. If the customer can make signature then there is no need to obtain the Pictures of the Customer but if the customer is Illiterate or there is no flow in the signature then the banker obtain two photo copies one is pasted over the Account opening form and other is pasted over the Specimen signature card. After that the person is asked to verify the signature of introducer, bank official make verification and put his initial over the AOF. After that new Account number is allotted and registered in the Account opening register.

The customer fills the pay in slip and deposit the amount in his account. Now pass book issued to customer due to introduction of Computer in the UBL branches.

One official then send letter of acknowledgment (letter of thanks to customer. It is a mode of verification the customer address. Cheque book only issue when the customer brings this letter).

When the customer brings the letter, he fills the Cheque book requisition slip and the chequebook is issued to him.

 

CHEQUE BOOK ISSUING DEPARTMENT

A. TYPES OF CHEQUES

There are two types of Cheques.

1. 
   
   Open Cheques
   
2. 
   
   Cross Cheques
   

 

1. Open cheques

Open cheques are those which are payable at the counter of the bank. There are two types of open Cheques: Bearer Cheques Drawer order the bank to make payment to the person who hold the Cheque Order Cheques Drawer order the bank to make payment to a specified person whose name is mentioned in the cheque. The bank pay only when it satisfied about the identity of payee.

2. Cross cheque

A cheque with two small parallel lines is a crossed cheque. You cannot encash such a cheque across the counter. It will only be credited to a bank account. Such a cheque has to go through clearing.

Kinds of crossing

There are two types of Crossing.

2.1    General Crossing

The drawing up of two simple parallel transverse lines on the face of the cheque at the top left hand corner with or without the words & co, not negotiable or Account Payee only in know as general crossing.

2.2 Special Crossing

A cheque deems to be crossed especially when it bears across its face the name of the banker either with or without the words not negotiable. In case of special crossing the payment can only be made to the bank named therein the cheque.

Objective of Crossing

1. 
   

   It prevent the payment of the cheque to a wrongful holder.
   

2. 
   

   It ensures safe payment to the concerned party.
   

3. 
   

   It is a guard against any cheating or theft.
   

B. ENDORSEMENT……..?

"The writing of a person's name either on the back or the face of instrument followed by one's signature for the purpose of negotiation is called endorsement". Suppose you receive a crossed personal cheque. You can deposit this cheque into your bank and receive payment in 2-3 days. What if you needed the money urgently? If the cheque is simply crossed, you can endorse the cheque to a friend. The friend can give you cash against the cheque. He / she will then deposit the cheque into their account. The bearer cheque merely endorsed by delivery to another person.

1. 
   
   Chequebook issuing by "cheque book requisition" against charges of Rs.30\-.
2. 
   
   Authorized officer takes the signature of client on the requisition.
3. 
   
   Signature is the referred to Remittance department to verify the signature of the client.
4. 
   
   Then pass the entry in the register and take the signature of the client in the register.
5. 
   
   Put it into system.
6. 
   
   Ticking of amounts and account No. by matching with depositing slip and those cheques which were cashed in the branch.
7. 
   
   Maintenance of the register of "Stock of stationary (such as cheque books, pay orders, demand drafts, RTCs form, TTs forms, stamps on hand it's a name of document, letter of continuity which is required in advance department).
   

2. REMITTANCE DEPARTMENT

Remittance function involves mobilization of money from one place to another. Remittance department only provides its services for out station mobilization of money and deals with documents i.e., demand draft, telegraphic transfer and rupee traveler's cheque.

 

Remittance department deals in following instruments.

1. 
   
   Demand Draft (DD)
2. 
   
   Pay Order (PO)
3. 
   
   Telegraphic Transfer (TT)
4. 
   
   Mail Transfer (MT)
5. 
   
   Pay Slip (PS)
6. 
   
   Rupee Traveler Cheque (RTC)

 

DEMAND DRAFT

1. 
   
   Demand draft is a written order, drawn by one branch of a bank upon another branch of the same bank, or upon another bank under special arrangements to pay a certain sum of money to or to the order of a specified person.
   
2. 
   
   Demand draft is a negotiable instrument.
3. 
   
   Demand draft is neither issued payable to bearer nor drawn on branches situated within the same city.
4. 
   
   It is to be insured that the purchaser of Demand Draft is able to at least sign his name.

Thumb impression is not to be accepted on DD. A person unable to sign and not having an account may be advised to apply for DD through a literate person to sign on his behalf. To avoid complications DD are not to be issued to Minors.

The followings are the parties to a Draft.

1. Purchases: Is a person, firm, company or local authority.
   
2. Issuing or Drawing Branch:     Which issues a draft on another branch.
   
3. Drawee Branch: Is one on which a draft is drawn.
   
4. Payee:    Is a person named in the Demand Draft to whom or to whose order the money is directed to be paid.
   

Issuance of demand draft

1. 
   
   On DD application form branch code Hub and Spoke Branch.
2. 
   
   Commission and other charges will be recovered with normal procedure.
3. 
   
   Attorney Officers will sign instrument.
4. 
   
   Name of Drawee (spoke) branch and Hub Branch will be written on instrument.
5. 
   
   Deliver instrument to purchaser against acknowledgement.
6. 
   
   DD application form along with all vouchers of the day will be sent to Hub branch.
7. 
   
   Address of the remitter account number must invariably be written on the back of the DD application form.
8. 
   
   Hub branch receipt of vouchers (DD Application).
9. 
   
   Post in the system.
10. 
    
    System will generate IBCA.
11. 
    
    Dispatch to Hub branch drawee spoke branch.

Encashment of demand draft

1. 
   
   Presentation of DD at Spoke Drawee branch.
   
2. 
   
   Counter (cash payment).
3. 
   
   Crediting in the account.
4. 
   
   Through clearing/Transfer Delivery.

PAY ORDER

• 
  
  The Remittances Department on request of the customer/noncustomer issues payment Order when he deposits amount in bank.
• 
  
  Since payment through a cheque is doubtful, pay order is generally acceptable be the Government/private Institutions. Some time parties also prefer to make payment through pay order, as they have an acknowledgement (proof) of payment.

Issuance of pay order

1. 
   
   Pay order Application Form is filled up and signed by the purchaser.
   
2. 
   
   Amount of pay order plus Commission, Excise Duty is deposited with cash department or cheque or party debit voucher debits party account (as the case may be).
   
3. 
   
   Pay order instrument is prepared a signed by two authorized officers.
   
4. 
   
   Particulars are recorded in any order issued register. It is handover to the purchaser against acknowledgement ("payees account only" crossing stamp is affixed on the face).
   

 

Payment of pay order

Pay order is presented for payment in Clearing or transfer delivery. In rare case it may be presented for cash payment on counter if it was issued uncrossed (open).

Genuineness of pay order is ascertained; date paid is marked in pay order issued register.

MAIL TRANSFER

Transfer of funds from one branch to another branch of the same bank within or outside the city or upon other bank under special arrangement for the payment to the beneficiary through Mail/ Courier services is called MAIL TRANSFER.

1. 
   
   Mail transfer is not negotiable.
2. 
   
   The funds remitted by Mail transfer are not payable to bearer.
3. 
   
   Like TT, funds can be remitted by MT for the credit of the payee's account or the payee / beneficiary can be advised to receive the amount from the drawee branch either on cash on proper identification.

PAY SLIP

Mostly the branch expenses and refunds are made through Pay Slip. It is legal receipt (non-transferable subject to stamp duty).

Issuance of pay slip

Pay Slip is issued for making payment of branch expenses such as:

1. 
   
   Payment of profit on PLS/TDS-NDR.
2. 
   
   Refund of Demand.
3. 
   
   Draft Cancelled.
4. 
   
   Payment of Subscriptions, newspapers.
5. 
   
   Payment of Petty stationery.
6. 
   
   Payment of repairs & renovations etc.
7. 
   
   For the above purpose Pay Slip is issued by debit to expenditure account.
8. 
   
   Disbursement of House Building Loan/Motor Cycle Loan of staff concern is some time also effected through pay slip.
9. 
   
   When Pay slips issued, particulars such as name of the payee, pay slip number, date issued (date issued is not written on Pay slips) are recorded in pay slip issued register.
   

 

 

Payment of pay slip

1. 
   
   Pay Slip may be presented on counter for cash payment (or can be deposited in account).
2. 
   
   Genuineness of the pay slip is ascertained; date paid is noted on he face of pay slip and is marked in pay slip issued register.

RUPESS TRAVELLERS CHEQUE

This Facility is basically for the businessmen. Through this facility they can easily keep a huge amount of money with safety.

Issuance of rupee traveler cheque

1. 
   
   Customer approaches the Teller for purchase of Rupees Traveler Cheques.
2. 
   
   Teller fills form TC 10 and asks customer to sign.
3. 
   
   Teller calculates withholding tax and receives cash from the customer.
4. 
   
   "Cash Received" stamp with date is affixed on form and writes denomination.
5. 
   
   Teller enters detail in cash receipt register.
6. 
   
   The Remittances Department on request of the customer/non customer issues payment order when he deposit amount in the bank.
7. 
   
   Since payment through a cheque is doubtful; pay order is generally acceptable by the Government/Private Institutions. Sometime parties also prefer to make payment through pay order, as they have an acknowledgement (proof) of payment.
8. 
   
   Payment telephone bills of bank, clearing adjustment, disbursement of finance, Income Tax etc. are also made through pay order.
9. 
   
   Name of the person is not mentioned after the works "PAY TO THE ORDER OF. However signature of the purchaser is required at the place specified (lower left corner).
10. 
    
    While issuing RTCs the issuing officer should ensure having signed the RTCs. with P.A number.
11. 
    
    Enter the serial number and particulars of RTCs in RTC issued/Stock register TC-30.
12. 
    
    Hand over RTCs along with copy of TC-10 to the purchaser.
13. 
    
    Dispatch the IBCA (COPY B) of TC-10 to RTC department Karachi.
14. 
    
    Stock of RTCs must be checked and balanced with TC-30 register.

ADVANTAGES OF RTC

1. 
   
   No bank commission.
2. 
   
   Secure-refundable in case of their loss.
3. 
   
   Nation-wide network for convenient encasement.
4. 
   
   Non Necessary to maintain an account with UBL.
5. 
   
   Easily transferable by one signature only.

TELEGRAPHIC TRANSFER

1. 
   
   Transfer of funds from one branch to another branch of the same bank or upon other bank under special arrangements for the payment to the beneficiary through Telegram / Telex / Fax is called a Telegraphic Transfer (TT).
2. 
   
   Telegraphic Transfer is not negotiable.
3. 
   
   Telegraphic Transfer of funds to a branch situated with in same city should not be affected.
4. 
   
   Remittance can be made for credit of the account of the payee / beneficiary if maintaining account with the drawee branch or may be paid in cash if the customer wants to send amount through TT then he will provide information of the beneficiary like ID card number, name. Then bank will make a credit advice and send it to branch on which it should be drawn .Now the beneficiary will go to that branch and show his ID card number and other information and bank will make TTR and customer will get that amount from cash department.

 

The followings are the parties to a TT

1. 
   
   Applicant: A person, firm, company, or local authority etc who desire to remit funds from one branch to another branch.
2. 
   
   Remitting or drawing branch:     Which remits the funds on another branch.
3. 
   
   Drawee branch: On which TT is issued.
4. 
   
   Beneficiary / payee: The person named in the TT whom the money is payable.

 

 

Precautions for Issuance of TT

1. 
   
   Full name of payee / beneficiary or account number should be mentioned in the application form along with his address.
2. 
   
   Instruction regarding mode of payment should be obtained i.e. whether the amount of TT is credited to the payees account or beneficiary should be advised to receive the amount of the TT from a drawee branch either in cash on proper identification.
   

3. BILLS DEPARTMENT

Ordinary bill is a document giving the relevant details of similar goods sold. But in banking by bill, we mean the bill of exchange and other similar instrument received for collection .The collection of cheques and bills on behalf of the customer is an important product of almost every modern bank, which can hardly be dispensed with because of the following reasons.

FUCTION OF BILLS DEPARTMENT

A) OUT WARD BILLS FOR COLLECTION

1. 
   
   Bills/Cheques drawn on and sent to our branches.
2. 
   
   Bills/Cheques drawn on the other banks collected through our branches.
3. 
   
   Bills/Cheques drawn on other banked collected directly through them.

Procedure for outward bill of collection

The details of the instrument realized as well as those retuned unpaid is then recorded in the OBC (LOCAL) register against the respective entry, and proceeds less collection charges shall be credited to the respective customer account. Unpaid returned cheques and other instruments shall then be returned to the customer as per normal procedure and collection charges shall debited to the respective account.

Procedure of balancing OBC ledge will remain same as at present.

B) INWARD BILLS FOR COLLECTION

1. 
   
   Bills/Cheques Received from our branches located and drawn on us.
2. 
   
   Bills/Cheques received from our branches drawn on other banks.
3. 
   
   Bills/Cheques received directly from other banks.
4. 
   
   Bills/Cheques received from parties such as post parcels.

 

Procedure for inward bills of collection

Instrument such as Cheques, Drafts, Dividend Warrants are not accepted for collection when received directly from parties because we do not get protection under Sec.131 of the Negotiable Act-1881, which states,

Subject to the provision of this Act relating to cheques crossed "Account Payee" Where a banker in good faith and without negligence receive payment for a customer of a cheque crossed generally or specifically to himself, and the customer has no title or effective title their to, the banker shall not insure any liability to the true owner of the cheque by reasons of only having received such payments."

In order to avail protection under this section, the banker should fulfill the following condition.

1. 
   
   He should have collected for his customer.
2. 
   
   He should have collected a crossed cheque, whether crossed generally or specially to himself.
3. 
   
   He should have done so in good faith and negligence.
4. 
   
   Since we do not collect it for our customer, therefore, we do not have protection under section 131.

On receipt of the instrument along with the forwarding schedule from our branches or other banks we proceed as follows.

Realization / Return o f OBC

Receipt of IBCA from APC-OH

1. 
   
   Upon Receipt of a sealed envelop from three APVC through courier service, the contents are checked.
2. 
   
   OBC realized scroll OBC 140 attached to IBCA.
3. 
   
   Returned unpaid OBC Cheques /other instrument.
4. 
   
   IBCA for the total amount of Cheques / other instrument / Letters and other document etc.
5. 
   
   To ensure and check unpaid instrument are tallied with OBC 140.
6. 
   
   Note date of payment in OBC Register and pass necessary accounting entries.
7. 
   
   Mark date of payment and and affix paid stamp on OBC 010.
8. 
   
   The amount of returned unpaid cheques etc and the amount shown are then tallied with the amount shown in the summary of the OBC-140 (Total Returned Unpaid) and total paid and realized.

 

4. CLEARING DEPARTMENT

CLEARING

Clearing is a system by which banks exchange cheques and other negotiable instruments, drawn on each other, within a specified area, and secure payment for their clients through clearing house specified time by book entries.

 

TWO TYPES OF CLEARING

a) Inward clearing b) outward clearing

 

a) Inward clearing

1. 
   
   The satellite branches will handle all collection items.
2. 
   
   The satellite branch will ensure the validity of cheque, signature verification amount in words and figures and stop payment instruction etc.
3. 
   
   In case the drawee satellite of same central is away from central even then the cheque should be sent to satellite branch, other banks will automatically be forwarding the Cheques to satellite branch by referring to the printed name of satellite branch.
4. 
   
   The drawee satellite branch will control / Mark the balance in the blue ledger and will forward collection cheque together with collection schedule (source DD issuance document), for posting at central branch and for issuance of down on collection schedule for posting at central branch and for issuance of IBCA.DD will be issued by the satellite branch of which will be noted down on collection schedule.

Procedure of the inward clearing

1. 
   
   The payee branch shall receive the incoming clearing scrolls and the cheque and immediately post the transaction in the respective account provided sufficient balance is available.
2. 
   
   Payee branch shall prepare an IBCA drawn on the main branch showing the number of instrument and amount received in incoming clearing, the number and the amount of instrument unpaid as well as the net amount.
3. 
   
   NIFT courier shall collect this packet. The IBCA is delivered to main clearing branch by NIFT courier.

    Returns

1. 
   
   The
   presenting branch shall receive the outgoing clearing unpaid returned scroll and instruments and immediately reverse the transaction in the respective account.
   
2. 
   
   Presenting branch shall respond the IBCA received from the main branch (prepared by NIFT) showing the number of instrument returned unpaid as well as the net amount.

b) OUTWARD CLEARING

1. 
   
   In outward clearing branch acts as collecting banker.
2. 
   
   Branch deposits are increased when clearing is realized.

Outward clearing at main branch

1. 
   
   Instrument with two copies of branch house page and branch schedule is received.
2. 
   
   Branch wise entry is made in house register, regarding name of branch and total number and amount of cheques received.
3. 
   
   Simple credit HO voucher for the branch concerned is prepared and is kept along with original house page for the time being.
4. 
   
   Instruments are sorted out bank wise.
5. 
   
   Main schedule is pre pared in duplicate.
6. 
   
   Main house page is prepared in duplicate and its amount is tallied with amount of house register.
7. 
   
   The main house page, main schedule and one copy of branch house page and branch schedule along with instruments are sent to clearing house, while duplicate copies of main scheduled and house page are kept as office.

 

 

Outward clearing at SBP/NBP

1. 
   
   The representative of banks exchanges cheques.
2. 
   
   Total amount and number of instrument received from other banks entered in clearing house book against house book against each bank.
3. 
   
   Declaration forms are completed and submitted to the controlling staff of clearing house.
4. 
   
   Clearing House Register is completed from declaration forms.
5. 
   
   Debit and Credit side of register, If equals the clearing house book is supposed to be balanced.
6. 
   
   Entries are made in the ledger maintained by the supervisor of clearing house of SBP / NBP.
7. 
   
   Clearing now received, in exchange of our outward clearing shall be called as sour inward clearing.

5. CASH DEPARTMENT

The following books are maintained in the Cash Department.

1. Receiving Cashier Book
   
2. Paying Cashier Book
   
3. Token Book
   
4. Book
   
5. Cash balance Book
   

When cash is received in counter. It is entered in the Scroll Book and Receiving Cashier Book. At the close of the day, these are balanced with each other.

When the cheque or any negotiable instrument is presented at counter for payment. It is entered in the token book and token is issued to the customer. The token and the Cashier make entry in the paying book and payment is made to payee. At the close of day, the Token Book and paying Cashier Book is balanced.

The consolidated figure of receipt and payment of cash is entered in the cash balance book and drawn closing balance of cash.


Opening balance of Cash + Receipts – payments  Closing Balance.

This is very important department. An officer check all the books maintained in this department.

Cash department prepares the utility bills sheets, which are sent by the bank to WAPDA, Sui Gas Department, and PTCL etc for their respective bills.

 

6. ADVANCES DEPARTMENT

TypeS of Advances

1. 
   
   UBL advances the following types of advances
2. 
   
   Running Finance (Overdraft)
3. 
   
   Cash Finance (Cash Credit)
4. 
   
   Demand Finance (Loan)
5. 
   
   Discounting the Bills of Exchange

 

TYPES OF SECURITIES

The following are the types of securities are generally accepter for advances.

Banker' Lien

A lien is the right to retain property in its possession till its (banker's) dues are cleared. Lien gives a person only a right to retain the possession of the goods and not the power to sell.

Guarantee

When an application for advances can not offer any tangible security, the banker may rely on personal guarantee to protect himself against loss on advances or overdraft to the applicant.

Mortgage

A mortgage is the transfer of an interest in a specific immovable property for the purpose of securing the money advanced by way of loan, an existing or future debt. The person in whose interest the property is transferred is known as "Mortgagee". The person who transfers an interest in property against a debt is called" mortgagor".

Hypothecation

Hypothecation is defined as" a legal transaction whereby goods may be made available as security for a debt without transferring property or the possession to the lender".

 

 

Hypothecation is very risky on two main grounds. One, as the goods are in the possession of the owner, the borrower may take out the goods without informing the bank. Secondly, the bank does not have a legal claim as it does not have a valid charge over the goods.

Pledge

A pledge is a contract whereby a good is deposited with the lender as security for repayment of the loan. The delivery of goods may be made by transferring the goods from the owner's go down to a banker's go down or the keys of the owner's go down be handed over to the lender. The delivery of documents of title relating to goods also creates a valid pledge. The person delivering the goods as security is called "pledger" and the person to whom the goods is delivered is known as "pledgee".

DEFERAL OF SECURITY/SUPPORT DOCUMENTAION

It is UBL's policy to disburse the approved credit facilities after perfection of the security/support documentation. Therefore, deferral of credit documents will generally be discouraged. There may however, be genuine situations where deferral of credit documents be necessary for disbursal of approved credit facilities on exceptional basis for selected customers. The deferrals will be kept at the minimum and will initially be allowed based on tenor may be allowed based on justifiable grounds. The maximum tenor for all deferrals will not exceed 90 days.

The following guidelines will be observed for allowing deferrals

1. 
   
   The customer has proven positive for track recede
   
2. 
   
   The customer has undertaken in writing to regularize the deferred document within the stipulated time.
   
3. 
   
   The bank is not exposed to a pecuniary risk on account of the proposed deferral.
   
4. 
   
   Completion of deferred documentation is certain and.
   
5. 
   
   The deferral does not violate any of the regulatory requirements.
   

TYPES OF DEFERRED DOCUMENT

A) ANCILLARY DOCUMENT

The ancillary is supportive in nature for determination of bank's legal position. This document will be deferred only when the client has executed basic security/support documentation and has completed all the pre-requisites while deferral is required for completion of procedural formalities by the concerned authorities. In such cases the bank retains an irrevocable right/authority to collect the deferred documents in due course.

B) PRIME DOCUMENTS

The prime documents are conclusive in nature and are therefore crucial for establishing Bank's right and/or claims. These documents evidence disbursal of facilities and creation of the relative securities.

The prime documents may include:

• 
  
  Mortgage/Title Deeds.
• 
  
  Documents for filing of charges.
• 
  
  Board resolution for borrowing etc.
  

 

BENCHMARK

RISK PROFILE RANGE	RISK RATING
91—100	1
81—90	2
71—80	3
61—70	4
51—60	5
45—50	6
41—44	7
35—40	8
25—34	9
Up to 25	10

 

1. 
   
   100% cash collateral in the currency of obligation will be risk rated "1".
2. 
   
   100% cash collateral in the currency other than the currency of obligation will be risk rated "2".

RISK RATING vs. CLASSIFICAION

RISK RATING	CATEGORY OF CLASSIFICATION
1—4	Current
5	Watch list.
6—7	OAEM-"A".
8	Substandard-"2".
9	Doubtful-"3".
10	Loss"4".

 

The proposed Risk Rating Criteria is a radically new concept for UBL and will take sometime for our RMs to understand, conceptualize and implement. However, initially CBG will implement the risk rating criteria on the basis of benchmark of risk profile for each risk rating recommended above. At a latter date, this criterion will be introduced for CB.

PRODUCTS UNDER THE ADVANCES

For the present UBL is offering amount amongst other the following major products.

1. 
   
   Policy Credits.
2. 
   
   Short term credit Facilities.
3. 
   
   Term Loans.
4. 
   
   Syndications.
5. 
   
   Project Financing.
6. 
   
   Guarantees and Bonds.
7. 
   
   Documentary Letter of Credit.

7. FOREIGN EXCHANGE DEPARTMENT

Foreign exchange department carries out international banking under SBP regulations. The main functions of this department include opening of foreign currency account in four currencies i.e., DM, UK Pound, $ and Japanese Yen, sales and purchases of foreign currency, issuing of foreign currency traveler's cheques, FTT, FMT, and FDD.

 

 

 

 

 

SECTION 5

FINANACIAL ANALYSIS

 

Financial Overview

The Bank achieved a profit before tax of Rs. 10.5 billion for the first nine months of 2006, which represents a 62% growth from the same period last year. Net income at Rs. 6.9 billion is up 82% against the same period last year, with Earnings per Share at Rs. 10.67 (September 2005 Rs. 5.87). Net markup/ interest income after provisions came in at Rs 13.4 billion compared to Rs. 8.9 billion for the same period last year owing to an increase in volumes and improved spreads on advances. Non-funded income increased by 37% to Rs. 4.6 billion, with commission income on consumer loans, fee income on collection of utility bills and increase in dividend income being the main contributors.

Administration expenses showed a 35 % increase over the same period last year. The main reasons for this are: a) an increase in staff to support the growth in the international franchise and consumer business, b) higher variable costs linked to the consumer business including commissions, promotions and loyalty programs and c) investment in employee retention and motivation programs. However, for the quarter ended September '06 compared to that ended in June '06, administration expenses have remained flat. Total assets grew by Rs. 41 billion in the last nine months at Rs. 388 billion, with gross advances increasing by 14% to Rs. 250 billion and deposits by 7% to Rs. 308 billion.

Economic Review

The economic performance in the first quarter of FY07 remained mixed. While food inflation hovered around the 11% mark, other inflation indicators: fuel, transport and housing depicted a downward trend bringing the core inflation for September at around 6.2%. Consequently the Consumer Price Index is expected to come down from 8% in FY06 to 7% by June 2007. The trade deficit for the first quarter, however, came in at USD 3.2B (up 32% above the same period last year) owing to import growth of 13% far outstripping the 3% growth in exports. However, with the tapering off in oil prices, the

 

 

Import growth for the next three quarters is expected to slowdown leading to a trade deficit estimate of USD 12-13B for FY 07. SBP continued tightening monetary policy with a 50bp increase in the discount rate to 9.5%. This coupled with the increase in the Statutory Liquidity Requirement (SLR) from 15% to 18% and frequent open market operations resulted in decelerating the growth in money supply M2. Private credit off-take for FY06 came in at Rs. 401B down from Rs. 428B in FY 05. However, keeping the GDP growth objective in mind, analysts are not predicting a further increase in interest rates going further.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

UNITED BANK LIMITED

PROFIT AND LOSS ACCOUNT HORIZANTAL ANALYSIS

(Rupees in Thousands)

 

as on sept30,as on sept 30,Increase/20062005DecreaseMark-up/return/interest earned23,763,16713,848,7179,914,45071.6Mark-up/return/interest expensed(8,525,032)(3,988,874)4,536,158113.7Net Mark-up/return/interest income15,238,1359,859,8435,378,29254.5Total Provision(1,805,604)(969,554)836,05086Net Mark-up/return/interest income after provisions13,432,5318,890,2894,542,24251non-mark-up/return/interest incomeTotal non-mark-up/return/interest income4,649,7443,404,545124519936.5Total Income (funded non funded)18,082,27512,294,834578744147Total non-mark-up/return/interest expenses(7,595,173)(5,831,092)176408130profit/(loss) before taxation10,487,1026,463,742402336062Total Taxation(3,580,473)(2,665,799)91467434profit/(loss) after taxation6,906,6293,797,943310868681.9Unappropriated profit brought forward7,350,8133,274,4394076374124Transfer from surplus on revaluation of fixed assets70,84170,6112300.33Profit before appropriation14,328,2837,142,9937185290100.6AppropriationTransfer to Statutory reserve(1,381,327)(759,500)62182781.9Final cash dividend for year 2004-2005 declared to this year.(1,295,000)(777,000)51800067Transfer to reserve forissurof bonus shares(1,295,000) ---00Less total appropriation(3,971,327)(1,536,500)2434827158.5Unappropriated profit carried forward10,356,9565,606,493475046385Basic earnings/(loss) per share10.675.874.882













UNITED BANK LIMITED
PROFIT AND LOSS ACCOUNT VERTICAL ANALYSIS
(Rupees in Thousands




as on sept30,as on sept 30,20062005%Mark-up/return/interest earned23,763,16713,848,717100100Mark-up/return/interest expensed(8,525,032)(3,988,874)35.928.8Net Mark-up/return/interest income15,238,1359,859,8436471.2Total Provision(1,805,604)(969,554)7.67Net Mark-up/return/interest income after provisions13,432,5318,890,28956.564.2non-mark-up/return/interest incomeTotal non-mark-up/return/interest income4,649,7443,404,54519.624.6Total Income (funded non funded)18,082,27512,294,83476.188.8Total non-mark-up/return/interest expenses(7,595,173)(5,831,092)3242profit/(loss) before taxation10,487,1026,463,7424446.7Total Taxation(3,580,473)(2,665,799)15.119.2profit/(loss) after taxation6,906,6293,797,94329.127Unappropriated profit brought forward7,350,8133,274,4393123.6Transfer from surplus on revaluation of fixed assets70,84170,6110.30.5Profit before appropriation14,328,2837,142,99360.351.6AppropriationTransfer to Statutory reserve(1,381,327)(759,500)5.85.5Final cash dividend for year 2004-2005 declared to this year.(1,295,000)(777,000)5.45.6Transfer to reserve for issue of bonus shares(1,295,000) ---5.40Less total appropriation(3,971,327)(1,536,500)16.711.1Unappropriated profit carried forward10,356,9565,606,49343.640.5











UNITED BANK LIMITED
BALANCE SHEET VERTICAL ANALYSIS
(Rupees in Thousands)





ASSETS20062005%%Cash and balances with treasury banks414220773406267910.79.8Balances with other banks10692714127292072.753.67Lending to financial institutions27410031178675527.065.15Investments568725026302694414.718.2Total Advances23530102020481047060.659 Total other assets1066051778297702.72.3Operating fixed assets494394044493241.31.3Deferred tax assets87459622730550.230.7Total Assets388177397347048951100100LIABILITIESBills payable551272341599641.41.2Borrowings from financial institutions309901152179048086.3Deposits and other accounts3080649632892262997983Sub-ordinated loan549834439991921.41.2Other liabilities1104107862047462.81.8Total 361107223325380681Share capital647500051800001.71.5Reserves7708561622546121.8Unappropriated Profit1035695673508132.72Surplus/(deficit) on revaluation of assets252956729119960.70.84TOTAL EQUITY388177397347048951100100













UNITED BANK LIMITED
BALANCE SHEET VERTICAL ANALYSIS
INCREASE (DECREASE)
(Rupees in Thousands)



ASSETS%%Inc/dec %Cash and balances with treasury banks10.79.80.9Balances with other banks2.753.670.92Lending to financial institutions7.065.151.91Investments14.718.23.5Total Advances60.6591.6Total other assets2.72.30.4Total Assets1001000LIABILITIESBills payable1.41.20.2Borrowings from financial institutions86.31.7Deposits and other accounts79834Sub-ordinated loan1.41.20.2Other liabilities2.81.81Share capital1.71.50.2Reserves21.80.2Unappropriated profit2.720.7Surplus/(deficit) on revaluation of assets0.70.840.14Total assets1001000















UNITED BANK LIMITED
BALANCE SHEET HORIZANTAL ANALYSIS
(Rupees in Thousands)





Increase20062005(Decrease)%ASSETSCash and balances with treasury banks41,422,07734,062,6797,359,39821.6Balances with other banks10,692,71412,729,207(2,036,493)(16)Lending to financial institutions27,410,03117,867,5529,542,47953Investments56,872,50263,026,944(6,154,442)(9.8)Total Advances235,301,020204,810,47030,490,55014.9Total other assets10,660,5177,829,7702,830,74736Operating fixed assets4,943,9404,449,324494,16611Deferred tax assets874,5962,273,055(1,398,459)(61.5)Total Assets388,177,397347,048,95141,128,44611.9LIABILITIESBills payable5,512,7234,159,9641,352,75932.5Borrowings from financial institutions30,990,11521,790,480919963542Deposits and other accounts308,064,963289,226,29918,838,6646.5Sub-ordinated loan5,498,3443,999,1921,499,15237.5Other liabilities11,041,0786,204,7464,836,33278Total 361,107,223325,380,68135,726,54211Net Assets27,070,17421,668,270540190425REPRESENTED BYShare capital6,475,0005,180,0001,295,00025Reserves7,708,5616,225,4611,483,10023.8Unappropriated Profit10,356,9567,350,8133,006,14340.9Surplus/(deficit) on revaluation of assets2,529,5672,911,996(382,429)(13)TOTAL NET ASSETS27,070,17421,668,2705,401,90425

Ratio analysis
There are many different ways in which we can determine the financial standing an position of any concern, however the most efficient and widely used method for this is the ratio analysis. This analysis can be derived either from the balance sheet or from income statement.

significance
The significance of this analysis varies according to the type of the analysis done.The nature of the business in respect of the particular group to whose needs the analysis taken into consideration. For example the creditors of the company have special interest in profitability of the company to pay current obligation and thus requiring information concerning the relation of current assets to current liabilities. Stockholder both present and future are concerned with the dividends that the company declares and the period after which is done so and earning per share that will form the basis for the declaration and payment of dividend. On the other hand the management is concerned with the liquidity of the company and also about the future of the business.
INTERESTED PARTIES:
Shareholders

1. 
   
   Creditors
   
2. 
   
   Management
   
3. 
   
   Present and prospective shareholders
   
4. 
   
   Government
   

 

Types of ratio analysis

Ratio analysis is not merely the application of a formula to financial data to calculate a given ratio. More important is the interpretation of ratio then calculation of value.

Two types of ratio comparison can be made

1. 
   
   Cross sectional analysis
   
2. 
   
   Time-Series Analysis
   

 

1. Cross Sectional analysis

Under this ratio entity financial ratio are compared with the ratio of other entity at the same point in time. For example if we calculate ratio of UBL then we compare it other banks financial ratios then it is called Cross Sectional Analysis.

 

2. Time Series Analysis

When we compare current financial year ratios with the past yarer it is called Time-Series analysis. Here we want to know that either this year ratio has been improved or decreased.

There are two types of Time-Series analysis

1. 
   
   Horizontal analysis
   
2. 
   
   Vertical analysis
   

 

To analyze the performance of UBL, the ratios have been divided into the following Category:

1. 
   
   Liquidity ratios
   
2. 
   
   Leverage(debt) ratio
   
3. 
   
   Bank affairs (activity) ratios
   
4. 
   
   Profitability ratios
   

 

A) LIQUIDITY RATIOS (SOLVENCY RATIOS)

These are the ratios, which measures the short-term solvency or financial position of a company.

1. 
   
   Current Ratio
   
   = Current Assets / Current Liabilities
   
   
    

   2006 2005 Current Assets 52114791 46791886 Current liabilities 36502838 25950444 Ratio 1.43 1.8

   CONTENTS
   

   Current assets
   Current assets		2006	2005
   Cash and balances with treasury banks		41,422,077	34,062,679
   Balances with other banks		10,692,714	12,729,207
   Total		52,11,4791	46,791,886

   
    

   Current liabilities
   Current liabilities		2006	2005
   Bills payable		5,512,723	4,159,964
   Borrowings from financial institutions		30,990,115	21,790,480
   Total		36,502,838	25,950,444

   
    
   
    
   
    
   
    
   
    
   interpretation   
   
   Current ratio tells the company ability to meets its current obligation with its current assets
   
   Despite of huge losses in the past UBL has not satisfactory current ratio 1.43 in 2006 and 1.8 in 2005. The standard current ratio is considered 2:1; UBL current ratio is less then standard and also decreased from 2005.
   
   
   
   2. Working Capital
   
   
   = Current assets - Current liabilities
   
   
   

   		2006	2005
   Current Assets		52,114,791	46,791,886
   Less Current Liabilities		36,502,838	25,950,444
   Working Capital		15,611,953	20,841,442

   
   
   
    
   
    
   interpretation
   
   The bank working capital ratio is unfavorable. It has decrease in the current year.
   
   Net working Capital is the safety cushion to creditors. Higher the net working capital greater the company creditors satisfied.
   
   
    
   
    

   B) LEVERAGE (DEBT) RATIO
   

   The ratios that show the extent to which the firm is financed by debt.
   
   
   
    
   
    
   
    
   
   
   
   
   
   
   
   
    

   1. Debt to total assets ratio:
   

   = Total liabilities less subordinated loans / Total Assets
   
   
   
   

   2006 2005 Liabilities less subordinated loan   321,381,489 355,608,879 Total Assets 388,177,397 347,048,951 Debt Equity Ratio 0.92 0.93

   Sub ordinate loan represent loan from directors and other internal loans
   
   
    
   CONTENTS
   
   Total liabilities less subordinated loan
   
   Total assets
   
   
    
   Total liabilities less subordinated loan
   

   2006 2005 Liabilities 361,107,223 325,380,681 Less Subordinated Loans 5,498,344 3,999,192 Total 355,608,879 321,381,489

                               
   
   
    
   
    
   interpretation   
   
   
    
   From the above ratio in 2006 92 percent of the firms assets are financed with debt of various types, and the remaining 8 percent of the financing comes from shareholders equity. Here in the year 2006 debt to total assets ratio has decrease. Ratio tells that to meet 92% liabilities UBL have 100% Assets in 2006.
   
   
    
   1. Debt to equity ratio
      
   = Total Debt / Shareholders equity
   
   
    
   
   
   

   2006 2005 Total debt 355,608,879 321,381,489 Shareholders equity 24,540,517 18,756,274 Ratio 14 17

   
   
   
   INERPRETATION
   
   This ratio tells that creditors are providing Rs.14 of financing for each Rs.1 being provided by shareholders in 2006.from the creditor's point of view this is not suitable because the creditors are providing much against the shareholders. Creditors generally like this ratio to be low. The lower the ratio, the higher the level of the firms financing that is being provided by shareholders.
   
   3. Long term debt to total capitalization
   
   = long term debt / capitalization
   
   
   
   
   

   	2006	2005
   Long term debt	324,604,385	299,430,237
   Total capitalization	349,144,902	318,186,511
   Ratio %	93	94

   
   
   
    
   CONTENTS
   
   
   

   	2006	2005
   Deposits and other a/c	308,064,963	289,226,299
   Sub ordinate loan	5,498,344	3,999,192
   Others liabilities	11,041,078	6,204,746
   Long term debt	324,604,385	299,430,237

   INERPRETATION
   
   
   
   In this ratio total capitalization represents all long term debt and shareholders equity. This measure tell that the relative importance of long term debt to the capital structure (long term financing) of the bank. This ratio in 2006 has decreased from 2005 which is favorable.
   
   C) Activity ratio
   
   Ratios that measure how effectively the firm is using its assets.
   
   1. 
      
      Total assets turnover
      
   = Interest earned / Total assets
   
   
    

   2006 2005 Interest earned 23,763,167 13,848,717 Total assets 388,177,397 347,048,951 Ratio % 8 4

   
    
   
    
   INTERPRETATION
   
   The relationship of total revenue to total assets is known as the total assets turnover, or capital turnover, ratio. This ratio tells that what is gross earning on total assets. There is only 8 percent gross earning on the 100 percent assets in 2006.but UBL has improved the percentage from 2005 to 2006.
   
   
    
   2. Total advance to total deposit:
   
        = Total Advances / Total Deposits
   
   
   20062005Total Advances235,301,020204,810,470Total Deposits308,064,963289,226,299Ratio %7670.9
   
   interpretation   
   This ratio tells how much bank has given advances from its deposits. This ratio tells that bank utilize only 76 percent advances from 100 percent deposits. But this ratio has increases in 2006 from 2005.
   
   D) pROFITABILITY RATIO
   An indication of good financial health and how effectively the firm is being managed is the company's ability to earn a satisfactory profit and return on investment.
   1. Return on investment (assets)
   = Net profit (Loss) after Tax / Total assets
   
   
   2006
   2005
   
   Net Profit( Loss)After Tax
   6,906,629
   3,797,943
   
   Divided by Total Assets
   388,177,397
   347,048,951
   
   Ratio %
   0.018
   0.011
   
   
   INTERPRETATION
   This ratio tells that the return on the total assets, in 2005 only 0.011 percent return on investment but in 2006 this percentage increase to 0.018 percent.
   
   2. Return on equity
   = Profit after taxation / Shareholders equity
   
   
   2006
   2005
   
   Profit after taxation
   6,906,629
   3,797,943
   
   Shareholders equity
   24,540,517
   18,756,274
   
   Ratio %
   28
   20
   
   
   
   INTERPRETATION
   This ratio tells the earning power on shareholders book value investment and is frequently used in comparing two or more firms (banks).a higher return on equity often reflects the firm's acceptance of strong investment opportunists and effective expense management. In 2005 the ratio was 20 percent and now in 2006 this 28 percent, which has increased.
   3. Earning per share:
   = Net profit after tax / Number of Ordinary Shares
   
   
   2006
   2005
   
   Profit after taxation
   6,906,629
   3,797,943
   
   No. of shares
   647,500
   647,500
   
   Earning per share
   10.67
   5.87
   
   interpretation
   The Bank's earning per share (EPS) is generally of interest to present or perspective shareholders and management. It represents the amount earned on behalf of each outstanding share of common stock. The Earning per share of UBL has improved slightly.
   
   
   
   
   Book value per share
    
   = Net assets / No. of shares
   
   
    

   2006 2005 Net assets 27,070,174 21,668,270 No. of shares 647,500 647,500 Book value 42 34

   interpretation
   
   Book value per share represents the net assets available to shareholders after paying all liabilities current or fixed.
   
   Book value per share also improve greatly in year sept 2006. The main reason is that there was much increase in net assets so when net assets increase book value of share also improve.
   
   
    
   5. rate of return on loans
   
   = Interest earned / Advances
   
   
    

   2006 2005 Interest earned 23,763,167 13,848,717 advances 235,301,020 204,810,470 Ratio % 10 7

   
    
   SECTION 6
   
   
   

• 
  
  SWOT ANALYSISANALYSIS
  
• 
  
  KEY AREAS OF UNITED BANK LIMITED
  
• 
  
  RECOMMENDATIONS AND CONCLUSION
  
  
   

  SWOT ANALYSIS
  

OF UNITED BANK LIMITED

SWOT an acronym that stands for strengths, weaknesses, opportunities and threats. SWOT analysis a careful evaluation of an organization's internal strengths, weaknesses as well as its environmental opportunities and threats. In SWOT analysis the best strategies accomplish in organization's mission by:

1. 
   
   Exploiting opportunities and strengths.
2. 
   
   Neutralizing its threats and
3. 
   
   Avoiding its weaknesses.

Following is a list of SWOT of United Bank Limited.

 

ORGANIZATIONAL STRENGTHS

A skill or capability that enables an organization to conceive and implement its strategies.

The United Bank Limited (UBL) has become the first bank in Pakistan and South Asia to adopt and implement Visa's EMV (Europay-MasterCard-Visa) chip-card programme for its forthcoming credit cards launch.

1. 
   
   The EMV is the global standard for chip-based payment transactions and is the future of payments.
2. 
   
   More equity due to privatization.
3. UBL & Ufone signed an agreement to formalize an upcoming marketing initiative for UBL credit card customers in a ceremony held in Karachi. As part of this strategic alliance, UBL customers will have the facility to avail Ufone special packages with International Roaming, GPRS, and MMS including security deposit waivers.
   
4. 
   
   UBL is the 2nd largest commercial bank in Pakistan with the network of over 1350 domestic branches and 55 international branches.
5. 
   
   Being the pioneer of banking in Pakistan, UBL is one of the oldest banks and is the richest in experience.
6. 
   
   UBL focuses on consumer banking by lucrative schemes, products and services suiting best to the wants and demands of the customers.
7. 
   
   The bank is always on the look to improve its services both to the domestic as well as overseas customers.
8. 
   
   Human resource development and introduction of new technology towards modern banking.
9. 
   
   24 hours cash access and safe payment products for high value transaction.
10. 
    
    UBL instant financing products for customers wanting instant loan facilities UBL branches.
11. 
    
    Having potential to encounter the competitive environment in the market.
12. 
    
    Customer enjoys the services at the residential localities.

 

WEAKNESSES

A skill in capability that does not enable an organization to choose and implement strategies that supports its mission.

1. 
   
   Slow down in advances growth in the short term as UBL focuses on quality customers in the markets.
2. 
   
   Extremely burden on employees due to work pressure.
3. 
   
   No coordination among the employees.
4. 
   
   Discrimination in services to customers with large and small accounts.
5. 
   
   Inconsistency in efficiency and working atmosphere due to the largest of branches.
6. 
   
   Sense of insecurity in the employees serving at low profitable branches due to the right sizing.
7. 
   
   Females feel uneasy in an environment among the male workers.
8. 
   
   Victim of political, legal and socio-cultural pressures.
   

 

OPPURTUNITIES

In area that, if exploited, may generate high performance.

1. 
   
   In opportunity exist, in form of opening of ladies banking section within the branch, which is entirely a new idea and it will attract customer.
2. 
   
   Growing policies of government on business and commerce sector provide UBL opportunities to take advantages of these policies to meet efficiently with the business people to solve their problems with the instant cash and financing facilities.
3. 
   
   Customer feedback on different products and accounts has really improved the bank performance and encourage the atmosphere for other future policies.     
4. 
   
   UBL also has an opportunity to expand its new technological advancement like, uni remote bank and internet banking facilities in order to serve the customers more efficiently.
5. 
   
   E-banking facility is also a new opportunity which is a flourishing business in foreign countries and can also be here, if UBL takes the initiatives.
6. 
   
   Due to efficient and veteran management group, UBL can also improve well and expand its foreign operation successfully.
7. 
   
   UBL provide opportunity to utilize its skills and efficiencies in leasing business.

 

THREATS

An area in the environment that increases the difficulties the organization's achieving high performance.

1. 
   
   Facing more competition by foreign banks in the market.
2. 
   
   Highly attractive and advance services by foreign banks to their customers.
3. 
   
   The threat of inconsistency and government policy regarding to business and economics sectors, specially political and regional situation which make the environment uncertain.
4. 
   
   Growing global technological advancement.
5. 
   
   Strict regulation by government over credit facilities to the customers as well as to meet the prudential.
6. 
   
   Loss of confidence of overseas customers due to freezing of accounts.

 

From SWOT analysis we can conclude that the management of the bank should adopt systematic planning for the bank growth, introduced new schemes UBL has more customers as compare to other banks, if they given proper attention to every customer then if in few years it will be the leading bank of the country.

 

ANALYSIS KEY AREAS

OF UNITED BANK LIMITED

PLANING

We have stepped into the new millennium, which will be the era of many economic technological, social and political changes globally; therefore it will be almost impossible for an organization to survive without planning its feature. Keeping in view these facts United Bank is fully committed to plan all its activities for the progress in such a dynamic and threatened changing environment. In designing an environment, for effective performance of individual working together in-groups, the most important task is to see the purpose; objectives and methods of attaining them are clearly understood. Planning can be classified into purpose, objective policy procedures and budgets. Each of these is explained below.

 

PURPOSE

Purpose is the Mission of an organization for which it exists and the reason why it should compete in certain sector or industry. Within this mission or purpose, the organization address itself to what it intend to accomplish both in the short and long run. Mission is a very broad statement of organizational direction. Keeping in view the importance of purpose, United Bank Limited also has its own purpose. Its main purpose is to provide quality services to its customers keeping in mind the ethical and international standard in mind.

 

OBJECTIVE

Corporate mission determines the parameters of specific objectives to be defined by the top management. Objectives are the end towards which an activity is aimed. These are the results to be achieved. Objectives state what is to be accomplished, by when and should be quantified if possible. These do not represent the point of planning but the end towards which all other managerial functions are aimed.

As far as United Bank is concerned, it has its own clear set of objectives that are clearly known to all employees. Apart from the broad statement of mission stated as earning profit other objectives include.

1. 
   
   To provide quality service to the customer.
2. 
   
   To quick disposal of credit.
3. 
   
   To efficient operations of the officers.
4. 
   
   To establish better co-operating.
5. 
   
   To expand the market share and growth.
6. 
   
   To contribute to the socio-economy development of Pakistan.

 

POLICIES

Policies are general guidelines for decision-making process throughout the organization.

Policies define an area within which a decision is to be made and ensures the decision will be consistent with and contribute to an objective. Policies help decide issues before they become problems; makes it unnecessary to analyze the same situation every time it comes up and unify other plans.

Keeping in view the importance of policies the upper management of United Bank engineered their own set of policies ranging from managerial, marketing and operational policies. These policies are known to each and every employee of United Bank but these are often implied. Polices and many of them do not exist in written form. Which some times create ambiguity for the employees.

 

PROCEDURES

Procedures are the plans, which establish a required set of method of handling future activities. They are guides to actions rather than to thinking. Procedures define the manner in which certain activities must be handled and accomplished.

United Bank has its own procedures for handling and accomplishing certain tasks like the operational procedures regarding day to day banking.

 

BUDGETS

Budget is a statement of expected results expressed in numerical terms. Budgets bring precision in planning. It also serves a control device for evaluating enterprise operations. In a broad sense a budget is a tool which managers use to translate future plans into quantitative terms.

Budget being the essential part of planning process is also prepared at United Bank. And different amount of resources is allocated for different uses.

 

 

RECOMMENDATIONS AND CONCLUSION

RECOMMENDATIONS

Branch Premises

Branch working environment should be improve and renovated with latest furniture and interior decoration. External look of the branch is not seemed to be attractive so it should be clean and well designed. Sufficient seating arrangements for customer is not available here, so sufficient service area and seating arrangements must be provided for customers.

Lengthy Procedure

The book keeping system and filling system of the bank is so lengthy and time taking. So staff's document processing time, should be reduced to improve working efficiency through proper training.

To Be Conscientious

It is usually observed that staff members waste lot of valuable time while performing their duties. During my training period, I feel that all staff members make a lot of unnecessary telephone calls to their relatives while dealing with their customers. In this way they not only waste a very precious time of their customers, but also waste the wealth of the country. So I feel that staff members are very irresponsible in performing their duties. So, staff member should be conscientious.

Work equality

The work has not been arranged between the employees of United Bank Circular Road Branch Lahore in an organized manner due to which some employees are working in a great pressurize environment while others enjoy setting idle. If the work is distributed equally then there will be relax environment and the employees will be fully satisfied.

Coordination between the employees

There is no coordination between the employees. Every one is in hurry to finish his work and go to home. They do not have positive response for each other.

Decentralization

A decentralized pattern of authority distribution should be followed at the bank. And employees should be given a due consideration while making decision which can affect the employees at lower levels.

 

Delegation of Authority

As mentioned before that upper management does not have full confidence in the employees working at lower level. Sufficient authority should be delegated to the officers working at lower levels.    

 

Market Visit

A very useful mode of contacts is through personal marketing visits. Such visits have other important by products, such as information about customers financial and business positions about the market reputation creation a feeling of importance in the minds of customers. Such visits should be properly arranged with regularity and consistency.

 

Job Rotation

A job rotation program should be followed for the individuals at the bank in order to keep them motivated and energetic so that doing the same job for years may not bore them.

 

Introduction of Modern Forecasting Techniques

Modern forecasting techniques should be adopted in order to meet the dynamic and competing business environment.

 

Friendlier Environment

Customer friendly environment should be maintained at the bank, in order to attract more clients.

 

Better Communication

A proper upward communication pattern should also be encouraged at the bank, which
would help the bank's top management to the actual happenings in the bank at lower levels in the bank.

 

 

 

 

 

Other Suggestions

1. New blood should be injected and young professionals should be recruited on merit to induce enthusiasm in the bank. Customers should be focus of all activities to boost up the business.
   
2. New marketing strategies should be developed to attract new customers.
   
3. Maximum automated machines should be used.
   
4. Security should be strengthening to minimize the chances of "deceits".
   
5. The workers should be given a sense of teamwork and the manager should be trained to manage the team as good leader.
   
6. There should be a proper check on staff member so that they become punctual and conscientious.
   
7. Business promotional activities should be increased to enhance the business.
   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONCLUSION

During my two month internship in 2008, I observed many things at the United Bank such as its working procedures, policies, and many other aspects of practical nature of a big organization like United Bank. On the basis of all these observations, I have come to the conclusion that the banking field is more competitive and dynamic now a day. There are a lot of financial institutions working side by side. In this competitive environment the bank must have to use more innovative and creative ideas so that to attract customer. Taking care of these things the UBL have started Uni-remote computerized system through which one can send money from one place to another in no time. Which is a good step towards its improvement.

Today UBL is opening its eyes to a dynamic new vision that will take banking to new heights and make UBL a world class bank. UBL is the reshaping bank and investing in state of the art technology to give innovative products and services.

UBL is now working as a private bank. Its equity position is very strong and it can compete its competitor in every aspect of banking. United Bank is one of the oldest and more settled bank of Pakistan in fact it remained in business of financial services for many years. During its course of history United Bank contributed a lot in the development and fostering the growth of economy in the country.

Despite all these facts there are some areas, which needs to be improved, like it should focus on its organization structure, Equal distribution of work should be done and bring professional people to all of its branches in order to meet the requirements of a new era and to fulfill the needs of 21st
century.

 

 

 

 

 

 

 

BIBLOGRAPHY

1. 
   
   www.ubl.com.pk
2. 
   
   www.ibp.com.pk
3. 
   
   "Banking Manual – United Bank Limited", 1986.
4. 
   
   Prof. M. Saeed Nasir, "Banking Currency and Finance" Ilmi Book House, Lahore, 1997,
5. 
   
   Three Quarter Report, September 2007.
6. 
   
   Organization chart of UBL is reproduced from UBL "Annual Report".
7. 
   
   An interview with the Manager UBL Circular Road Branch, Lahore, Dated august 2008.
8. 
   
   Israr, H. Siddiqi, "Practice & Law of Banking in Pakistan" 5^th Ed, Royal Book Co., Karachi, 1993.
9. 
   
   Larson, Dermitt D, "Fundamental Accounting principles" 12thg ed, Richard D. Irwin, Inc, Boston, 1990,