internship report on Bank of khyber

7/23/2019 internship report on Bank of khyber

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CHAPTER # 1

INTRODUCTION

INTRODUCTION OF BANK OF KHYBER

The Bank of Khyber was established through an Act of KPK

Assembly called, “The BoK Act, 1991, “passed in une 1991 the bank was formally launched

on !o"ember #1, 1991$

The Bank of Khyber initially started as a pro"incial Bank and later declared as %cheduled

&ommercial Bank by %BP in %eptember, 199'$The initial paid up capital of the Bank was (s$

1)* million, which has now been raised to (s$ 1 billion$

SCHEDULED BANK STATUS

%ince 199' the Bank of Khyber has come under the regulatory framework of %BP, and

operates as %cheduled Bank at the !ational le"el$

+hile compliance with reuirements and other regulatory restrictions had a negati"e impacton Bank-s profitability in 199),

.owe"er the ensuring growth in business e/panded the profits of the bank reaching (s 0)

million in the year 199$

BRANCH NETWORK

At the end of the year 2#1', the Bank was operating with 113 branches$ The Bank

recei"ed appro"al from the %tate Bank of Pakistan for the opening of 1' new branches in the

year 2#1), now there are 1*# branches all o"er the country with 3) &on"entional and 3)

4slamic Banking branches$ Through this network, the Bank is able to offer wide range of

products and ser"ices to its "aluable customers$

PURPOSE OF STUDY

The purpose of the study is to know the practical implementation of the theoretical

knowledge, in an organi5ation$ The study on the bank of Khyber was carried out to find the

answers to the shortcomings that were obser"ed during the internship$ Based on the analysis

and findings some recommendations are presented to the management for impro"ement of its

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operations$ Apart from this, the internship report is an important and compulsory reuirement

for the Bachelor of Business Administration 7egree$

SCOPE OF WORK

The internship was done at Bank of Khyber, Batkhela branch$ The main emphases of

this study is on the working operations of accounts, cash, clearing, credit, 4T and remittance

sections and the financial analysis of the Bank of Khyber, Batkhela branch, KPK

METHODOLOGY OF THE STUDY

The data information for the internship report was gathered through different sources

i$e$ primary as well as secondary8 a detail of these is gi"en below

PRIMARY DATA

The inter"iews, discussions with management and staff members, briefings gi"en by

mangers, uestionnaire filled by the staff and my personal obser"ation during the internship

were the sources of primary data$

SECONDARY DATA

The broachers, manuals, annual reports of the Bank of Khyber other booklets of The

Bank of Khyber about the rules and procedures, :ournals, information on the website of The

Bank of Khyber were the sources of secondary data$

BANKING

A bank is an 4nstitution, which deals in money$ Broadly speaking, Banker draws

surplus money from the people who are not using it at the time and lend to those who are in a

position to use it for producti"e purposes$

BANKING SECTOR IN PAKISTAN

The money market structure in Pakistan comprises the following 1; %BP 2;

&ommercial Banks *; </change banks '; &ooperati"e Banks ); &ooperati"e &redit Banks 3;

%a"ing Banks ; %peciali5ed &redit 4nstitution$

BANKING SECTOR IN KPK

There are about 22 Pakistani %cheduled banks operating in the KPK ha"ing 11'

branches$ 4n addition * foreign scheduled banks with a total of * branches are also operating

in the pro"ince$ .istorically banks in the KPK ha"e been able to mobili5e substantial

amounts of the total deposits of the country$ .owe"er their share of in"estment in the

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pro"ince has not been within the pro"ince has also increased creating a demand for banking

ser"ices$ A large e/patriate community from KPK residing o"erseas especially in the =iddle

<ast are also offering opportunities to banks operating in the pro"ince$

MISSION STATEMENT

The Bank of Khyber being an organi5ation has mission$ The mission, documented in

the mission statement is as follows

“To increae !are!o"er$ %a"&e an 'ro%ie e(ce""en) er%ice an inno%a)i%e 'ro&c)

)o c&)o*er )!ro&+! e,,ec)i%e cor'ora)e +o%ernance- ,rien". /or0 en%iron*en)- an

con)ri&)in+ )o/ar an e2&i)a"e ocioecono*ic +ro/)!3>

MAIN OB4ECTI5ES OF THE BANK

The BoK was established to

• =eet demand of the business community to ha"e a Bank with its .ead ?ffice in the

Pro"ince$

• .a"e accessibility of local businessmen to senior management of the Bank for prompt

credit decision making thereby accelerating in"estment in KPK$• .a"e ma/imum utili5ation of funds raised in the Pro"ince for economic de"elopment

of KPK$

• To mobiles pri"ate sa"ings and public funds for di"erting the same into producti"e

channels and ensure their a"ailability$

• To promote industrial agricultural and sonic economic processes through the acti"e

participation of pri"ate and public sector in the pro"ince$

• .elp under de"eloped areas and create employment opportunities, especially in the

rural areas of the pro"ince$ @urther, to guide and assist the people of KPK ser"ing

o"erseas to effecti"ely and profitably in"est their foreign sa"ings in the pro"ince as

well as in other parts of Pakistan$

• Participate and seek of the pro"ince in the capital market of Pakistan by way of subscription

through locally pooled resources in the leading stock e/changes of the country and

e"entually pa"ing the way for establishing a stock market in the pro"ince$

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• ?ne of the purposes behind the establishment of BoK was to fulfill the demand of the

business community of KPK, and to ha"e a commercial bank its head office in the pro"ince

to ser"e more effecti"ely the people of the pro"ince$

PRODUCTS OF BOK

C&rren) De'oi) Acco&n) 6R&'ee7

The B?K current deposit account allows the facility of unlimited

+ithdrawals up to the e/tent of the Balance in account$ There will be no ta/ deducted on the

funds that someone chooses to keep in these accounts$

Sa%in+ e'oi) acco&n) 6r&'ee7The B?K sa"ing deposit account allows the facility of multiple withdrawals up to the

&redit Balance, while accruing profit on deposits$

Ter* e'oi) acco&n) 6r&'ee7

The B?K Term 7eposit Account offers the dual benefit of attracti"e returns with

highly liuidity$ There is option to take profit monthly, uarterly, biannually, annually or at

maturity$ Profit is accrued on a daily Balance basis$ There is no penalty for premature

encasement$ .owe"er, in case of an early encasement the rate of the pre"ious tender will be

applied$

Ca"" e'oi) recei') 6CDR$S7

This is a receipt by the bank, at the instructions of the depositor, confirming that the

amount of the %7( is held by the bank to be paid whene"er called upon to do so by the

beneficiary named in the &7($

ATM er%ice

4n order to keep pace with ad"ancements in the field of technology, B?K has :oined

the electronic platform of =!et switch$ This will facilitate consumers by pro"iding them

access to their funds through the e/isting AT= network of the country$ 4n B?K Batkhela

branch AT= was installed in =arch 2#1' to facilitate their customers$

We)ern Union

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Through western union people send their money from one country to another country$

B?K Batkhela branch also has the facility of western union$

@ollowing reuirements are necessary for western union$

The recei"er of the money must ha"e the photocopy of hisher original computeri5ed

!ational 4$7 card$

The =T&! C=oney transfer control number;$

E('re *one. P"aci E('re an Ma"i0 E(c!an+e

B?K has also pro"ided the facility of </press money, Placid </press and =alik

</change through which money is transferred from one country to another$ All other

reuirements are same as that of western union$ There are no charges on western union,

=alik </change and e/press money$ The bank pro"ided this facility free of cost because

money transferred from other countries increases foreign reser"es of the country it offers the

dual benefit of attracti"e returns with highly liuidity$ There is option to take profit monthly,

uarterly, biannually, annually or at maturity$ Profit is accrued on a daily Balance basis$

There is no penalty for premature encasement$ .owe"er, in case of an early encasement the

rate of the pre"ious tender will be applied$ The option of partial liuidity is allowed i$e$

withdrawal to a certain percentage from the fi/ed deposit without disturbing the remaining

deposit$

COMPETITORS OF BOK

• The Bank of Pun:ab

• Allied Bank Dimited

• Bank Al @alah

• Askari Bank

• @aisal Bank

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CHAPTER # 8

ADMINISTRATI5E AND FUNCTIONAL

SETUP OF BOK

ORGANI9ATIONAL STRUCTURE OF BANK OF KHYBER

The Bank of Khyber is one of the modern organi5ations, it being managed by a

competent staff$ 4t is a centrali5ed organi5ation and the authority flows from up to bottom$

All the a"ailable information about the organi5ation-s management and structured are gi"en

in this chapter$ Based on BoK Act, the general superintendence and direction of the affairs

and business of the bank has been entrusted to the Board of 7irectors CB?7;$ The Board of

fi"e directors comprising four directors nominated by the go"ernment of KPK$

BOK$S BOARD OF DIRECTORS

According to the Bok Act, the Board of directors comprises of nine as follows

• @our directors nominated by the go"t$

• ?ne director nominated by the @oreign <uity .older

• Three directors elected by the shareholders

• The managing 7irector shall be the ninth director

MANAGEMENT

The day to day operations of the bank are run by a capable team led by =r$ Basher

Ahmad who is a competent, well ualified and highly respected banker$ .e has ser"ed with

the +orld Bank and as @ederal %ecretary to the go"ernment of Pakistan$ .e has also ser"ed

as the managing 7irector of P4&4&, 47BP, !4T and chairman, A7BP during his career$ .e

holds a degree in economics from the Dondon school of <conomics$ ?"er the past few years,

=r$ Basher Ahmad has gathered a team of professionals and well ualified senior e/ecuti"es

of the bank$

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EMPLOYEES

The bank currently employs *)1 regular officers in "arious cadres of the bank$ They

include 2 Ph$7$, 101 post graduates including ) =BAs=$com, 9* =$A=$%c, 1* DDB from

foreign and local uni"ersities and 139 graduates$ (egular &lerical !on&lerical &adre do not

e/ist in the Bank$ The bank pro"ides them with on the :ob training, as well as e/posure to

ad"ance courses and seminars conducted by the institute of Banker in Pakistan and other

professional institutes$

HEAD OFFICE

Bank of Khyber has its .ead ?ffice$ 4t is situated in cantt$ This office is euipped

with latest scientific tool$ 4t has internet software$ 4t pro"ides all the important information$

.ead office has two di"isions8 as gi"en below

The banking di"ision

Administrati"e di"ision

These are further classified for the purpose of administrati"e con"enience$ There are also

other 2 independent departments$

Dong term pro:ects

Audit department

Dong term pro:ects handles the in"est proposals of huge industrial pro:ects whereas audit

department is meant to ha"e an internal control

DIFFERENT DEPARTMENT IN HEAD OFFICE

1$ Branch operation department

2$ =icro business and (ural de"elopment

*$ 4n"estment

'$ Personnel and establishment

)$ Accounts and treasury

3$ =onitoring and reco"ery

$ Dong term pro:ects

0$ &omputer

9$ @oreign e/change

1#$ Public relation

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11$ &redit

12$ ((=&(&

1*$ 4nternational banking

DEPARTMENTS

13 BRANCH OPERATION

The branch operation department has direct control on operation of branches$ 4t handles

all these issue that are directly related to the operation of branches e$g$

• .andles and legal issues

•Budget pro:ection

• Test key

83 MICRO:BUSINESS AND RURAL DE5OLOPEMENT

This department deal specially with the due of cotton industry and small businesses,

the aim of establishment this department was to fulfill the finance need of small businesses in

KPK$ This department also pro"ides loans to women de"elopment and rural area$

;3 IN5ESTMENT

This is a relati"ely new establishment department$ The purpose is to pinpoint the

in"est opportunity and to de"elop in"estment programs$ This department also forecast threat

associated with this opportunity and gi"es e/pertise$

<3 PERSONNEL AND ESTABLISHMENT DI5ISION

i; Personnel$

ii; <stablishment

.uman are the backbone of organi5ation$ 4ts success is largely dependent on its personnel$

The personnel department handle all the issue related to its employee it handle from recruit to

promotion from A&( preparation to punishment and incenti"es etc$

4n order to de"elop its talented employee personnel section in collaboration with =%

department which was establishment recently aims at pro"iding, preser"ing and enhancing

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new as well as e/isting employee competence in their :obs through impro"ing their

knowledge, skill, abilities and other characteristics by pro"iding them training opportunity$

ACCOUNT AND TREASURY

This department keeps entire record relating to accounts$ This department as its name

signifies is responsible for handling the account of cash of bank of Khyber$

This department is further di"ided into two departments

ACCOUNT DEPARTMENT

Account department is responsible for repairing uarterly income statement, cash

flow statement and Balance statement$

TREASURY DEPARTMENT

Treasury department is responsible for managing funds and to a"oiding chance of

misuse of funds$

MONITORING AND RECO5ERY

4n strict sense this department is legal hand of bank of Khyber$ This department

negotiates all the debts and if its efforts go in "ain then they file litigation$ This department

pro"ides full assistance to branches in enforcement of actual reco"eries of debt through legal

process$ They trace borrowers and their assets and ser"icing of summons$

LONG TERM PRO4ECTS

This department is concerned with primarily with long term pro:ects$ This duty is to

identify those long term pro:ect that will add significantly to de"elopment and progress of

KPK in particular and Pakistan in general$

COMPUTER DEPARTMENT

!o modern organi5ation can be "isional without computer$ This department is

responsible for computeri5ation of "arious branches of Bank of Khyber$ This department has

de"eloped network software “internet> for the .ead office etc$

FOREIGN E=CHANGE

This department is responsible for

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• =aintaining @&A

• 7ealing in telegraph drafts in foreign currencies

• @acilities of imports and e/ports to client

PUBLIC RELATION

This department suggests how to impro"es relation with the public, how to attract

customers and how to enhance people to in"est in bank$

CREDIT DEPARTMENT

&redit di"ision is for large loan sanction$ This department handles the reuest and

proposal of borrowers$ This department is responsible for handling the lending acti"ities of

the bank$ 4t pro"ides accounts the terms and conditions to clients$ 4t is responsibility of this

department to accept or re:ect a proposal$

RRMC>RC

• (eco"ery of stuck off loans$

• !egotiate with customer$

• Banking court$

• =ortgages$

HUMAN RESOURCE DI5ISION

.uman resource di"ision C.(7; plays a "ital role in car"ing the present and future

image of an organi5ation by managing employees in the most beneficial and effecti"e

manner, the functional arena of .(7 consists of recruitment, training, performance

appraisals, planning and career de"elopment and abo"e all grooming of staff to adhere to

office ethics and social norms$ At B?K, they belie"e that manpower is the most important

and precious asset$ The .(7 tries to create an en"ironment of mutual trust and dignity and

trying hard to pursuit the e/pression “+e rather than 4> so as to ensure best positi"e results$

4t is playing a proacti"e role in capacity building, e/perience sharing, strengthening analytical

and policymaking, skill upgraduation to help the staff in their endea"ors to make BoK

competiti"e, dynamic and one of the best banks in the country$

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.(7 pro"ides on the :ob as well as offsite training to the staff in di"erse areas of banking

and management$ The training relies on both e/ternal courses at institutes of repute in the

country and internally arranged courses$ The management is "ery cautious about the training

needs of the staff and e"ery year a handsome budget is allocated for this purpose, our policy

is to pro"ide e"ery employee at least one opportunity to attend training program in each

calendar year$

4n addition to abo"e, BoK acknowledges professional acumen, e/perience and e/pertise of its

staff through regular financial benefits in the shape of competiti"e salaries, cash awards,

promotions, academic, sponsorships and other incenti"es so as to boost their morale for

greater input towards betterment of the bank$)

.(7 department includes

1$ Personnel and <stablishment department

2$ Public (elation department

*$ %tationary department

ESTABLISHMENT SECTION

<stablishment is another ma:or section in PE < department8 this section is responsible for the

following acti"ities8

• <stablishment of new Branches$

• =aintenance of e/isting Branches$

PROCEDURE OF ESTABLISHING NEW BRANCH

1$ The management committee decides whether a new branch should be established or not

keeping in "iew the a"ailable de"elopment funds$

2$<stablishment section assigned the responsibility to pre pare the sur"ey report for the

establishment of new branch such as bank name, number of branches capital structure, total

deposits, liuidity position, etc$ the part two contain details about new branch, information

regarding the following items$

• !ame of the proposed branch$

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• Docation of the proposed branch or other arrangements$

• =eans of communications a"ailable at the proposed location$

• &onfirmation of the branch location that whether it falls within the municipal town

area$

• !ames, location and distance of nearest other bank-s branches$

• Population of the area$

• The "olume and "alue of agricultural mineral, industrial production, import and

e/port of area of branch operations$

• 7etail of e/iting schemes for agriculture mineral or industrial de"elopment and their

probable effect on the "olume and "olume and "alue of present production, import

and e/ports$

• <stimate income which the branch e/ports to earn within three years of its operations,

details of sources such as interest return on ad"ances, communion, funds, placed with

head office$

• <stimating the recurring e/penditure for the proposed branch profitloss anticipated$

• The sur"ey officer submits with the sur"ey reports with %BP$ %BP makes the final

decision of granting license for$

• ?nce license is granted by %BP, establishment of new branch, which in"ol"es some of

the following

• Degal contract with the owner of proposed branch building, if any prior arrangements

ha"e been for the location of new branch$

• Purchasing, leasing of necessary euipments Csuch as computers, fa/ machines, safes,

lockers; through bidding for new branch$

• 4nsurance of branch euipment with the appro"ed insurance &ompanies$

MAINTENANCE OF E=ISTING BRANCHES

The =aintenance in"ol"es all sort of e/penditures which are incurred either for the

repair of capital assets or for conditions to a"ailable capital assets, within the e/iting branches

and bank-s residences the establishment section premium on issues capital to the concerned

branch, establishment section also handles the "ehicles payment of token face and

replacement of any part of the "ehicles, office euipment$

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FUNCTIONS OF ESTABLISHMENT DEPARTMENT

1$ Acuisition, 7isposal replacement of fi/ed Assets, including "ehicles$

2$ =aintenance, upkeep of euipment reno"ation of fi/ed Assets$

*$ (outine "isits to Branches, .? 7epartment regarding super"ision of maintenance and

branch reuirements$

'$ !egotiation, liaison with suppliers, contractors, Architects and Dandlords Clesser;$

)$ Arrangement of premises for branches, .? and e/ecution of lease agreements$

3$ 4n"iting of tenders uotations for such :obworksgoods$

$ Preparation of appro"al sanction notes$

0$ ?btaining appro"al from PE + committees for such worksgoods$

9$ Processing payments of bills, pertaining to such works :obs procurements$

1#$ Preparation of capital budget of the bank$

12$ %uper"ision of Administrati"e matters and general

&ondition cleanliness of branches$

1*$ Diaison with branches regarding upkeep, maintenance,

Acuisition of such assets E general condition of

Branches$

1'$ %ecurity arrangement i$e$ pro"ision of security Fuards,Burglar Alarm %ystem etc$ to .ead office and branches$

FUNCTIONS OF PERSONNEL DEPARTEMENT

1$ They are engage in Personnel policy and (ecruitment Planning$

2$ They are concern with promotion and transfers of the employees$

*$ Fi"e loans, =edical lea"es and 7isciplinary actions to the employees$

'$ They gi"e training to the employees$

)$ They are engage in .uman resource 7e"elopment, ob (otation, Training, &areer

7e"elopment, <mployee (elation, .ealth @itness Program

3$ They arrange board meeting in the organi5ation$

$ They also deal internees$

0$ They forecast future needs and human resource planning$

9$ They gi"e salaries to the employees$

1#$ They are engage in screening and selection of employees$

11$ 4t also gi"es Post (etirement Benefits to the employees of the bank$

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FUNCTIONS OF PUBLIC DEPARTMENT

1$ 7esign E launch publicity of the bank of Khyber$

2$ Arrange high le"el meetings with Fo"ernor chief minister pro"incial E federal

=inisters arrange highle"el Fo"ernment officials$

*$ Accompany the managing director at the meetings as principal staff officer$

'$ Fenerate <nglish bulletin on political cultural social economic news$

)$ &onduct protocol duties with the "isiting dignitaries, delegations E other luminaries$

3$ Prepare press release in <nglish E Grdu$

$ Keep close liaison with all Pakistani politicalsocial leaders$

0$ Keep liaison with all the international organi5ations like

G!.&(4&(&G!?&.AAfghan commissioner ate, KPK, Peshawar too coordinate

in relation to issue of B?K$

9$ Keep close contract with local industrialists, businessmen E %arhad

1#$ &hamber of commerce E industry for promoting mutual trade relations$

FUNCTIONS OF STATIONERY DEPARTMENT

1$ Administration and o"erall super"ision of the department as 4n charge of the

7epartment$

2$ Putting notes for seeking prior administrati"e appro"als for procurement of printed

and security stationery from purchase committee and after appro"al8 order are placed

to printer$ After receipt of respecti"e consignments8 payment notes are submitted to

purchase committee$

*$ &orrespondence with .?Branches7epartments$

'$ Being the %ecretary of %tationary &ommittee, meeting of the committee are arranged

for making decision with regard to introduction of new items8 amendments of e/isting

forms and pads with consultation and consent of members of committee$

)$ (ectification of audit ob:ections and remo"al of any complaint of the

Branch7epartment in respect of supply of items at the stationery reuired$

3$ Any other matter which management wants to discuss in respect of supply of printed

and security stationery items$

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CHAPTER ;

BANK OF KHYBER 6BATKHELA BRANCH7

In)ro&c)ion o, )!e Branc!

B?K Batkhela branch is one of the important branches of B?K$ Because it is one of the

commercial places, it performs all the functions of the commercial bank, from deposits to

ad"ances, remittances etc$ The Batkhela branch of B?K is widely acclaimed as the busiest

branch in the region$ The site of the branch is "ery suitable$ !ew Building of the branch is

big enough to accommodate the staff and clients comfortably$ The staff of the bank is so

acti"e to deal the clients$

De'ar)*en) o, BOK Ba)0!e"a

1$ Accounts 7epartment

2$ &ash 7epartment

*$ &redit 7epartment

'$ 4T 7epartment

)$ &learing 7epartment

3$ (emittances

De'ar)*en) in /!ic! I /or0e &rin+ *. in)ern!i'

The departments in which 4 worked are,

Acco&n) De'ar)*en)

This department coordinates all the banking acti"ities there by keeping track of each

acti"ity in a seuential manner and pro"ides uptodate data$ The accounts department is also

responsible for proper accounting of assets and liabilities of the branch$ This department is

the backbone of the entire banking system$ All the banking acti"ities are placed through this

channel$ The main functions of this department are

• =aintenance of books of accounts$

• Preparation and disbursement of salaries of bank-s staff

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• =aintenance of superannuating funds and in"estment of the staff

• 7ealing with the disposal of commercial and e/ternal audit (eports$

• Preparation of budget and other financial statements

S&'er%ior$ na*e? M3 Ai, Niar

4o )i)"e? Acco&n) O,,icer

Ca! De'ar)*en)?

&ash department owes its importance to the fact that it is a ma:or point of contract

between the bank and the customer, the bank-s most "alued relationships$ This department is

the showcase of the bank and con"eys the first impressions about the bank-s commitment to

professionalism in its system and procedures and to courteous and efficient customer ser"ice$

This department performs the function of receipts and payments$ <fficient cash management

is needed to e/ecute payments, collect recei"ables and maintain liuidity$

All the acti"ities of the cash department are di"ided into two i$e$ &ash &ollection and &ash

Payment$

S&'er%ior$ na*e? Fa@a" Hai an Uai 0!an

4o )i)"e? CD Inc!ar+e

Re*i))ance De'ar)*en)

@unds transfer facility or remittances of funds are one of the functions of the banks all

o"er the world$ (emittances through banking channels sa"e

Time, costs less and eliminate the risks in"ol"ed in physical8 transportation of money from

one place to another$

T.'e o, Re*i))ance

(emittances can broadly be classified as outward and inward remittances$

O&)/ar Re*i))ance

+hen a bank branch instruct another bankbranch to affect a remittance or payment, it is

said to be affecting an outward remittance$

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In/ar Re*i))ance

+hen a bankbranch is itself affecting a payment disbursement at the instructions of

another bankbranch, it is said to be handling an inward remittance$

Moe o, Re*i))ance

7ifferent modes and means of remittance are discussed below$ B?K transfers money in

the following ways

1$ 7emand draft C77;

2$ Telegraphic transfer CTT;

*$ =ail transfer C=T;

'$ Pay order CP?;

S&'er%ior$ na*e? M3 Sa"*an an M3 Anee G&""

4o Ti)"e? Re*i))ance O,,icer

Crei) De'ar)*en)

The bank is profit seeking organi5ation$ 4t attracts surplus balance from the customer at

low rate of interest and makes ad"ances at a higher rate of interest to the indi"idual and

business firms$ &redit and e/tensions are

The most important acti"ity of all the financial institutions, because it is the main source of

the earning$ &redit department is one of the most sensiti"e and important department of B?K$

About )H of the profit is usually earned through this department$ The :ob of this department

is to make proposals about the loans8 the credit management di"ision of .? directly controls

all the ad"ances$

S&'er%ior$ na*e? S&!ai" 0!an

4o Ti)"e? Crei) O,,icer

IT De'ar)*en)

The B?K has appointed some ualified software and hardware engineers in 4T

department$ The senior most is deputed as “4ncharge> of the 4T department$ %oftware

engineersprogrammers are not only responsible for application de"elopment in B?K and to

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fulfill reuirements of the bank, but also act like trouble shooters, whereas, installation of the

hardware in the branch set up is the responsibility of hardware engineers$ 4n each Branch,

they ha"e assigned a systems administrator to look after :obs related to the computing system$

S&'er%ior$ na*e? A"i Go!ar

4o Ti)"e? S.)e* A*ini)ra)ion

TASK WHICH I PERFORM DURING MY INTERNSHIP

Tasks that 4 ha"e performed during internship are

Acco&n):o'enin+

Accounts opening department is one of the departments that come under the retailgeneral

banking facilities pro"ided by Bank of Khyber$ %ome of the ma:or deposit Accounts opened

by Bank of Khyber are as follows

C&rren) Acco&n)

&urrent Accounts are noninterest bearing accounts that ha"e a minimum account opening

(euirement of (s 1#,###$ !o 5akat is deducted on the accounts balance$ @urthermore all

current account holders recei"e a .ilal debit card and there are no restriction on the number

of withdraws or deposits made to and from the account$

Pro,i) Lo Sa%in+ Acco&n)

ProfitE Doss sa"ing accounts can be opened with a minimum balance reuirement of (s

),### and profit is credited on a half yearly basis$ There are no restrictions on the number of

deposits and withdrawal made to and from the account and all account holders recei"e$

Baic Re2&ire*en) ,or Acco&n) O'enin+

The basic reuirements to open an account for indi"idualsselfemployed are as follows

I &!4&

I %ource of income Csalary slip etc;

I &ompany letterhead or authori5ation Cas reuired;

I

The basic reuirement to open an account for a partnership

I Partnership 7eed

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I Partners &!4&

I &ompany Detterhead

The basic reuirement to open an account for companies

I =emorandum of Association

I Article of Association

I 7irectors &!4&

I &ompany Detterhead

C!e2&e oo0 i&ance

4t is issued to those customers whose accounts are operated by the

&oncern bank$ 4 ha"e also learned to make &heue book reuest by

@illing its different contents like serial number, date, account number, account type and

account title$ 4 also issued cheue books to customers as well$ Then 4 used to record its entry

in the register and signatures were taken from customer as a proof$ (ecord had been entered

on separate pages for current and sa"ings account$

Crei) De'ar)*en)

4n my internship, 4 ha"e also worked in credit department where 4 seek what kind of loans

B?K pro"ides to its customers

1$ Types of customers to whom it pro"ides loans

2$ &riteria for pro"iding credit

*$ 4nterest rate

'$ Procedure for "erifications of customers

)$ 7uration of loans granted

3$ Procedure in case the customer defaults

C"earin+

4 got the e/perience to know about the cheue clearance process$ =y clearing department

officer told me the procedure of both the inward and outward clearing, software used and role

of !4@T$ 4 used to fill these cheues by filling its contents$ 4n this regard, 4 ha"e also learned

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about techniues to check the scrutiny of check by checking name, date and sign and also

came to know that three stamps are needed for it8 clearing stamp, cross stamp and

endorsement stamp$

4 was ad"ised by my sir =r$ %ami Gllah to be remained alert about the fake cheues,

gi"ing some instructions for the careful e/amination of cheues like signature "erification

from specimen card$ @or the time of recei"ing cheues 4 had to consider the following

instruction,

1$ 7ate of the cheue mean post out dated cheue must not be recei"ed$

2$ Amount in figure or wording must be same$

*$ %ignature must be authori5ed$

'$ 4f cheue amount in abo"e of 1##,### than super"ision must be necessary$

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CHAPTER # <

ANALYSIS

ADMINISTRATI5E ANALYSIS

13 SPACES SHORTAGE

4t is obser"ed that branches suffer from space shortage$ The seating arrangement is

not sufficient as compared to the number of employees and customer$

83 CENTRALI9ATION

BoK has a centrali5ed structure$ There is no delegation of authority to the lower

managementstaff$ 4n order to impro"e the performance of the staff and to build their

confidence, some authority must be delegated to the lower management$

;3 LACK OF SPECIALI9D TRAINING

4n BoK training is pro"ided on basis of generali5ation rather than speciali5ation$ After

completion of training heshe is inducted into a specific field$ 7ue to lack of knowledge he or she faces difficulty to perform the assigned :ob$

<3 NEGLIGENCE OF RULES AND REGULATIONS

4t has been noted that the Bank-s officers usually neglect the rules and regulations

either intentionally or unintentionally, because these ha"e not properly communicated to

them$ Their prompt communication must be ensured and the employees must be informed

about the penalties in cases of negligence$

3 POOR 4OB ROTATION

Branch officers are not properly rotated$ 4t is noted that an e/perience banker from

7eposit section doesn-t know about the work of remittance department$ %o they must be

rotated in all the departments of the banking order to get familiar with the working of

different department in order to ha"e a knowhow of the whole system$

3 IMPROPER DISTRIBUTION OF DUTIES

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4n BoK there is improper distribution of duties and responsibilities$ 4t is being

obser"ed that sometimes an officer of the same grades may less or more responsibility than

another officer of this grade$

3 WORKING SETUP

4t is obser"ed that there are some deficiencies in the branch setup, which creates e/tra

disturbance, and e/cessi"e mo"ement, which in turn affect the efficiency of employees and

thus that of the whole organi5ation also$

POLITICAL ANALYSIS

INTERNAL POLITICAL EN5IRONMENT

1$ 4n personnel and establishment is no systematic reward that result is lower employee

moti"ation$ 7ue to which the e/perience pro:ect officers freuently lea"e personnel and

establishment$ This result in constant shortage of pro:ect officer$

2$ There is a "ery weak coordination among employee of personnel and establishment$ 4t

ser"e as factor toward is efficiency of which on it$

*$ There is no political pressure for strong coordination between different institutions so as to

lower the cost of employees$

'$ There is lot of political interference in the recruitment system of the bank that results in

inefficient management which in the long run results e"entually in bad portfolio$

)$ .a"ing )1H share of Bank of Khyber pro"incial go"ernment always interfere in regular

operation of bank which has strong impact on efficiency of bank$

SWOT ANALYSIS

%+?T is an acronym for %trength, +eaknesses, ?pportunities and Threats$ %+?T

analysis is a careful e"aluation of an organi5ation-s internal strengths, weaknesses as well as

its en"ironmentale/ternal opportunities and threats$

S)ra)e+ie ,or SWOT Ana".i

• </ploiting opportunities and strengths$

• !eutrali5ing its threats

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• A"oiding its weaknesses$

%+?T analysis is based on the assumption that if management is careful then it

ensures organi5ational success$ %+?T analysis is an important tool in analy5ing the o"erall

situation in which organi5ation is conducting its business affairs8 each issue remains rele"ant

and useful of corporate strategy formulation$

SWOT ANALYSIS OF BANK OF KHYBER

STRENGTH

1$ @irst bank to start 4slamic banking in Pakistan$

2$ Pro"incial go"ernment backing and confidence of people due to go"ernment bank$

*$ 4t has modern technology and resources$

'$ %taff has combination of young and rich in e/perience and working skill$

)$ ?fficer attracti"e schemes and, more sa"e for customer from time to time$

3$ The Bank of Khyber has market confidence in pro"iding products and ser"ices to the

customers o"er the year$

$ Bank of Khyber has the ability to cope with pressure of competition$0$ Bank has the good with of the people and it is also an asset to it$

9$ Bank-s management has the moti"ation to make it best bank of the country$

WEAKNESS

1$ <mployees are lacking moti"ation$ Bank is not limits and thus reducing the efficiency$

2$ &ommunication gap between different le"els of management$

*$ The lower le"el management lacks clear direction and is not ha"ing the managerial

depth$

'$ Dack of e/perienced commercial bankers in the top management positions

)$ Dack of modern banking approaches like AT= and commerce on line banking$

3$ =arketing skills of the bank are good but they ha"e little presence at different media$

$ Dow salary structure as compare to competitors$

0$ !ot in the position to compete with other banks$

9$ Dack of highly trained resource staff$ 4ncreasing trend of bad loans$

1#$ Dack of modern technology$

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OPPORTUNITIES

1$ ?pportunity to open branches in northern areas specially because there is 1##H

current deposit$

2$ All branches are computeri5ed therefore no difficulty

4n thinking it into on line banking$

*$ Bank should take interest in the new market segments like 4T business, software

business etc$

'$ A new ser"es to its product line$

)$ 4ncreasing credit facilities to lower income groups, thus reducing the risk of loss and

also impro"ing the image of the bank$

3$ To open a branch in Afghanistan$

THREATS

1$ Political, economical situation of the country$ (eduction in the business acti"ities in

the country$

2$ 7eteriorating confidence of people in bank uncertainties of the in"estors$

*$ =odern technology used by other commercial banks$

'$ %tarting 4slamic banking is threats for BoK because if it is flop it will be a big loss for

BoK$

)$ 4ncreasing number of pri"ateforeign banks in the country$

3$ (educing the rates of sa"ings in different segments of people$

$ Flobal technological ad"ancement$

0$ Bank Alfalah and other commercial banks is the biggest threat for BoK$

9$ Jualified staff working in other banks$

@or “%+?T> analysis we can conclude that the management of the bank should adopt

systematic planning for the bank growth, talking with them all management le"els of the

banks, disco"er new segments of the customers, offering schemes for its customers$

%imilarly Bank of Khyber has to focus on potential customers and gi"e proper attention to

e"ery customer and their need then it will become one of the leading and comprehensi"e

banks$

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<mphasis on present customers by gi"ing them personal %er"ices and targeting the

pri"ate potential customers instead of Fo"ernment deposits at high interest rates$ &reeping

trend of nonperforming loans$

CHAPTER #

RECOMMENDATION

The following findings and recommendations are based on personal obser"ations and

analysis$ The gi"en recommendations will help to cope the problems being faced by the bank

and will enhance the efficiency and performance of the bank of Khyber$

13 SPACE SHORTAGE

7uring my internship in Batkhela Branch 4 obser"ed that there is shortage of space at

branch$ There is no proper and easy seating arrangement for the customers$ To o"ercome this

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problem, the bank either may hire the ad:acent building or simply can shift to some other

place$

83 BETTER TRAINING PROGRAMS

4t has been noticed that the training program of BoK is not adeuate$ %pecial

marketing training should be gi"en to employees for moti"ating customers$ The training

program of bank should include scientific techniues to impro"e decision making and

interpersonal as well as indi"idual needs of an employee$

;3 DECENTRALI9ATION

%ome authority and responsibility should be delegated to the lower grade staff as well

so that they should also consider themsel"es important and responsible$ This will also be

moti"ating factor for them and results in greater efficiency$

<3 PROPER CHECKING

There is no proper checking system on the entrance of bank$ @or safety purposes,

there should more security measures, besides special checking instruments at the main

entrance$

3 BETTER COMMUNICAION

The management of BoK should concentrate on impro"ing upward communication so

as to ha"e better feedback system in"ol"ement in the bank operation$

3 MERITORIOUS RECRUITMENT

Appointment in the bank should be strictly on merit basis with no other fa"or gi"en to

any candidates$

4n the BoK connection play an important role in recruitment decisions$ (ecruitment

should be based on rele"ant ualification and e/perience particularly in the field of business

administration, financial management, and computeri5ation and marketing e/pert through

competition, which will ultimately attract better competent employees in the bank$

3 MARKETING 5ISITS

A "ery useful mode of conduct is personal market "isit$ %uch "isits should be properly

planned with regularly$

23 6 P a g e



3 TRAINING ACADEMY

The BoK does not ha"e its own training academy$ The training to newly recruited

employees is gi"en in the training academies of other banks$ %imilar is the case for e/isting

employees$ To fulfill the reuirements of training of the new and e/isting employees to

recei"e training of the peculiar and specify working functioning of the BoK$

3 SHORTAGE OF EMPLOYEES

%hortage of employees increases the workload on e/isting employees and ultimately

reduces the output and moti"ation le"el of employees$ To o"ercome this problem :ob

description should be re"ised and grouped together in order to create new :obs$

(ecruitment should be done in order to fill up these new "acancies$ 4n this way the

workload on employees will be reduced, operations will be stream lined and employees will

feel comfortable in performing their duties more effecti"ely$

13 FRIENDLIER EN5IRONMENT

@riendlier en"ironment should be created because it will help to gain the interest of

employees in work$ !oise in the office should be reduced because it has unfa"orable impact

on the working en"ironment$ %eparate place or section should be created for each separate

task and more space should be pro"ided$ 4t would also be of greater help in establishment of

friendly en"ironment$

113 ENHANCED CUSTOMER SER5ICES

&onstant impro"ement in customer ser"ices are needed in today-s competiti"e

en"ironment$ Personali5ed banking should be introduced to attract more customers$ <ual

respect should be gi"en to all customers$

183 INTERNATIONAL BANKING

BoK should e/pand its branches, not only in Pakistan but also outside the country

now$

1;3 LATEST COMPUTER EUIPMENTS

Datest software should be introduced in the bank so that the data processing speed of

the computer can be enhanced$

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1<3 CUSTOMER CARE COUNTER

&ustomer-s satisfaction is the key to success$ They need proper attention$ The .ead

office is understaffed and employees are o"er loaded, it creates more problems for them when

customers disturb and interrupt them while working$ Therefore, for the benefit of customers

and smooth working of bank, there should be a customer care counter to guide and help the

customers$

CHAPTER #

CONCLUSION

Based on the findings and recommendation made in the pre"ious chapter of the report, the

action plan for scholarship programs to enhance the education and skill of the deser"ing

employees is gi"en here as under

REASONS

1$ The BoK has about '## employees and most of them are simple graduates$

2$ Persons holding degrees of foreign uni"ersities are not keen and willing to :oin the BoK$

They are always trying to :oin the multinational companies or foreign banks$

REMEDIES

The following remedies are suggested to cope with the situation$

• The BoK should stress on education and e/perience$

• The BoK should constantly gi"e incenti"es and opportunities to its employees to

enhance and impro"e their education profile$

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@or this purpose the best option, which the BoK can a"ail, is to started scholarship

program for its employees to study in country-s best uni"ersities or aboard to get degree of

=BA or =BA banking and finance and Ph7 etc$

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BIBLIOGRAPHY

•The Bank of Khyber, personal and Administration 7epartment =anual,

2###$

• The Bank of Khyber, (ecruitment policy 2###$

• The Bank of Khyber, 4nformation =emorandum 1990

• !+@P Act !o$ 4L$ C1991;

• Koont5, .arold$ C199*; =anagement in Flobal Perspecti"e8 !ew Mork8

=cFraw .ills, 4nc$, 1#th <dition,

• Personal working during internship period$

• httpwww$bok$com$pk

• httpwww$wikipedia$com

• &onsulate Feneral of %wit5erland, C2#11;, Pakistan Banking sector, Karachi

• Bank of Khyber information memorandum$ C2##9;$ 4nformation

=emorandum Peshawar

•

Bank of Khyber C2##9;$ Annual (eport$ Peshawar • Bank of Khyber C2#1#;$ Annual (eport$ Peshawar

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http://www.bok.com.pk/

http://www.bok.com.pk/



Documents

internship report on Bank of khyber