Dedication
At first dedicating this work to Allah Almighty, without His mercy and sympathy I was not able to accomplish this work .Allah Almighty gave me power and confidence to done my internship and also holy prophet Hazarat Muhammad (Peace Be upon Him) who is a light for humanity.
I also dedicated this work to my dear parents, teachers and the treasure of my life, my friends with deepest gratitude whose and prayers have always been a source of strength for me.
ACKNOWLEDGEMENT
All praise to Almighty Allah, the most merciful and compassionate, who give me skills and abilities to complete this report successfully. I am grateful to my parents who are always been a source of encouragement for me throughout my life and from start to the end of this report
I am thankful to all my staff members of Allied Bank Of Pakistan Limited corporate branch Multan. I found every one very co-operative and helpful for providing me the Theoretical as well as practical knowledge about the function and operation of the bank.
I am also thankful to those who provide me their precious time and helped me to understand the processes, policies, procedures and operations practically and thus help me in conducting this internship report.
PREFACE
The requirement of internship for BS Accounting and Finance is met by professional program by involving a combination of theoretical education and practical training. It gives student with skill, knowledge and professional values, sufficient for performing as qualified professional and to continue to grow in their career through an unending process of learning.
In this concern I was given an opportunity to have 8 weeks internship in “Allied Bank Limited Corporate branch, Multan”. During my whole time I worked in different departments of the bank and was thoroughly briefed about the procedure and working by cordial senior staff. My report is all based on what I have learnt there. I hope that my report will give you good overlook of all the service related matters.
Executive summary
Table of contents
Introduction
Allied bank limited was the first bank to be established in Pakistan. The Bank started out in Lahore by the name Australasia Bank before independence in 1942; and became Allied Bank of Pakistan in 1974.
In August 2004, because of capital reconstruction, the Bank’s ownership was transferred to a consortium comprising Ibrahim Group; therefore, it was renamed as Allied Bank Limited in 2005.
Today, with its existence of over 75 years, the Bank has built itself a foundation with a strong equity, assets and deposit base. It offers universal banking services, while placing major emphasis on retail banking. The Bank has a large network of over 1250 online branches and ATMs in Pakistan and offers various technology-based products and services to its diverse clientele
Allied Bank Limited operates by the following Vision, Mission and Values:
Vision
To become a dynamic and efficient bank providing integrated solutions in order to be the first choice bank for the customers.
Mission
To provide value-added services to our customers.
To provide high-tech innovative solutions to meet customers’ requirements.
To create sustainable value through growth, efficiency and diversity for all stakeholders.
To provide a challenging work environment and reward dedicated team members according to their abilities and performance.
To play a proactive role in contributing towards the society.
Core Values
Integrity
Excellence in Service
High Performance
Innovation and Grow
Bank’s organogram
Products and services
ABL facilitates its customers by providing different types of services of deposits, advances,foreign exchange and other general services. Here is the list of services provided by bank:
Current account
This account is suitable for customers looking for a simple bank account for day to day transactions. With Allied Bank’s Current Account, you get all the usual advantages and features of a regular current account for all your daily transactions, frequent payments and flow of funds.
PSl saving account
With Profit & Loss Sharing (PLS) – Saving Account, you get all the checking account features with a steady profit rate to grow your savings.
Allied basic banking account
This account is suitable for customers looking to avoid minimum balance requirements and operate a simple bank account for limited set of transactions.
Khanum asaan account
Exclusively personalized account for WOMEN.
Women in the role of entrepreneur, doctor, teacher, engineer, housewife etc. have significant goals and challenges for accessing financial services. Khanum Asaan Account provides an exclusive and priority access to financial services and empowering women to take better care of their investments. The account will provide a complete solution for banking and lifestyle needs to female segment.
Allied Asaan account
Now you can open a bank account with a deposit of Rs. 100/- only.Opening a bank account is not an arduous task anymore. Allied Asaan Account is convenient and accessible to individuals who want to open account. These individuals may belong to any walk of life and will experience finest banking services at Allied Bank.
Allied Asaan Account has been designed in a way to attract those segments of the community that are unprivileged and un-educated which may include freelancers, students, housewives, farmers, laborers, pensioners, etc. All it requires is a valid CNIC/ SNIC and deposit of Rs.100/- to open an Allied Asaan Account.
Allied easy current account
Allied Easy Current Account is a recently-launched current account tailored to meet banking needs of every individual, requiring No Service Charges on Minimum Balance Requirement.
Allied rising star
It is a savings account for youngsters below 18 years of age. It can help you save your pocket money and earn daily profit. So, if you’re below 18 years of age, you can open your very own Allied Rising Star – Youth’s 1st Bank Account and have all the fun that goes with it!
Allied express account
Get your loved ones to open an Allied Express account You can now receive foreign remittances, with complete peace of mind. Just intimate your account number to your overseas relatives and friends, enabling them to remit directly into your current account.Allied Express Account is an easy and hassle free account for the Home Remittance Benefices .This account provides you relief in receiving your money without having to go to the bank’s branch.
Allied term plus deposit
Our Allied Term Plus Deposits reward customers with a guaranteed, highly competitive profit rate for putting their money away for a fixed amount of time.
Allied business account
With Allied Business Account, the Bank offers you ease, flexibility, and a whole range of free benefits specially tailored to match all needs of your growing business. And there is no minimum balance requirement for operating this particular account either.
Platinum rewarding profit account
If you have higher balances to maintain and wish to earn higher profit rates with full access to your funds, Platinum Rewarding Profit Account is best suited to your needs.
Allied direct-internet banking
Online offering that give you the freedom to do the banking when and where you want.
Allied internet banking offers you the convenience to manage and control your banking and finace,when you want to,where you want to.it’s simple and convenient,secure and faster.
Allied SMS banking
Allied sms banking puts your finance as close as your mobile phone.now all your financial transactions can be executed by sending an sms to allied Bank’s short code 9080using any mobile phone without requiring internet or GPS.
Allied digital lockers
Allied Digital Lockers have been equipped with multi-layered verification process for customer security. Digital Lockers allow customers to access their lockers without assistance of bank staff with complete privacy and convenience.
Introduction to the department
ABL corporate branch Multan
Branch code (393)
Address: Abdali road Multan
I did my internship of eight weeks in Allied bank, corporate branch Multan from 5th June 2017 to 31st July 2017 in the field of corporate banking.
Corporate banking is custom-tailored financing and banking services for corporations. Corporate banking is typically offered by commercial banks, and entails all the services that can be extended on a financial level to corporate entities to ease day-to-day operations. The products they offer include treasury services, loans and credit, trade finance (such as letters of credit), and employer services (such as payroll).I selected this branch because I was of the view that I can find more learning opportunities in main branch as compared to other branches.
In the same branch different departments of ABL are working. So I got the opportunity to know briefly about three departments.
Operation department
Trade department
Credit department
Operation department
The banking operations department manages financial and administrative duties.It also oversees and supervises all services and operations of the bank. Moreover, it is responsible for the safekeeping of money and facilitation of the bank’s activities, by ensuring that all functions proceed smoothly.
An operations department is responsible for running business successfully.
The operation banking department perform the functions of account opening, deposits of check, demand draft(DD), pay order(P/O), clearing, telegraphic transfer, collection of bills etc.
Credit department
The main function of the credit department is to lend money. In the lending process, selection of borrower is the most crucial and vital job for a banker. Before a customer enjoys credit facilities it is important that the applicant should qualify for five Cs.
The five Cs are:
• Character – Intention to pay back the loan
• Capacity – Borrower’s competence in terms of utilizing the fund profitably and generate income
• Capital – Financial strength to cover the risk
• Conditions – General business condition between two parties
• Collateral – Implies additional securities
In addition, objectives of the credit department are managing credit exposure of the bank, maintaining credit risk, compliance of Central Bank Ltd, recovering or collecting dues of retail loans or advances.
Types of loan
In the corporate branch of ABL the different types of loans are given to the customers.
Short term
Medium term
Long term
Money market loan(MML)
Finance on import merchandise(FIM)
Payment against documents(PAD)
Short term loan
There are two types of loan in it
Running finance
Cash financing
Short term loan is for one or less than 1 year. In running and cash financing the customer can take the loan on daily basis and can be adjust when the payment is made by the customer. The markup is charged until the loan is paid.
The difference between running ad cash financing is that security is pledged against cash financing and hypothecation of documents against running finance
Hypothecation: in the case of hypothecation the bank takes the documents of the goods or securities. Both the ownership and physical possession remain with the borrower.
Pledge: In this matter the borrower surrenders the physical possession of the goods, under effective control of the bank. The ownership of the goods however, remains with the borrower.
Medium term loan
This type of loan is for three to five years
Long term loan
This type of loan is for five to ten years
Security is mortgage against the medium and long term loan.
Money market loan
Money market loan is also the short term loan like running and cash financing but the difference is that there is no daily basis transactions are involved.im MML the customer can take the loan one time and disburse it when the time comes. The period is from one week to three months. Basically it gives benefit to both the customer and bank. Its markup is less as compared to other type of loans and the benefit to the bank is that the bank knows that how much markup will earn.
Finance on import merchandise
This is a short term loan extended to an importer for the retirement of the LC at Sight against pledge of imported merchandise. The validity of this finance is capped maximum up to 180 days and the customer is at a liberty, either to adjust it in lump sum or in tranches, within the validity of the finance period. The PAD is got adjusted through FIM and imported merchandise is stored in a warehouse under the custodianship of bank’s appointed guards. The customer deposits the required or desired amount at the bank’s counter and obtains delivery order of pledged goods there-against.
For example: suppose the customer is not able to pay for his order so the bank will pay through FIM. When the goods arrive at the port, the possession will be of the bank. Firstly the customer will pay back the loan and then the goods will come in the possession of customer.
Payment against document(PAD)
An arrangement under which an exporter instructs the presenting bank to hand over shipping and title documents to the importer only if the importer fully pays the accompanying bill of exchange or draft. Also called cash against documents.
When the letter of credit is issued the documents against the loan is kept as a security by the bank. When the stock comes at the port the customer take the documents back and put the stock as the security for the loan.so the PAD convert into the FIM.
Trade department
The trade department protects consumers from unsafe and poor quality products and creates favorable conditions for exchange of goods.
Allied bank, with its variety of export products and expertise, can help customers mitigate risks involved in export transactions, which in turn, will help their export business flourish. We offer a wide range of import products delivered by our expert trade team who ensures quick and efficient processing of transactions.
Trade services
Trade Finance
Allied Bank provides highly efficient trade finance services for import/export businesses through a large number of authorized branches where trained and motivated staff is available to handle the business on the customer’s behalf
Finance/credit facility
These are short term credit facilities (maturity of up to one year) lent to customers to meet their day-to-day business/working capital requirements and finance their inventories, receivables, etc.
Generally, in addition to collateral security, these facilities also entail security in the form of hypothecation of stocks and receivable/pledge of stocks.
Foreign bill purchase
This loan/facility is provided to exporters against their export bills under LC and a contract to facilitate their cash flow, while they are waiting receipt of their payments.
Guarantees
On behalf of the customers, the Bank issues a guarantee in favor of the beneficiary, against the performance of a particular job/contract, within a particular time.
Application of Classroom Concepts
During my internship period, I got the chance to see the application of many concepts which I have studied during my academic period. I am glad that I have seen the practical use of multiple financial instruments which were previously only studied theoretically.
These are the some procedures and instruments which were used in ABL to manage the financial and accounting Data.
Clearing process
Pay order
Demand draft
Letter of credit
Clearing process
Check clearing is the process of moving funds from one account to another. … It simply means that the checks, once deposited into the bank, need to be transferred to the clearing system, which then communicates with the other banks that the checks are from.
