Acknowledgement

First and foremost we thank Allah who guided us through the way and endowed us with
enough health and knowledge to complete this research. Without His mercy indeed, we
would not have been able to complete this report.
Secondly we would like to extend our heartfelt gratitude to our instructor Sir.
IshfaqAhmad for his help and motivation. He remained a great source of support and
encouragement throughout this research.

Executive Summary
Pakistan after getting its independence, did not inherit a strong banking industry and
since then saw a number of events in the industry, like the nationalization of banks in the
1970s. However today, the banking industry of Pakistan has been growing over the past
few years, mainly because of the consistent policies implemented by the Government of
Pakistan, including the privatization of banks in Pakistan. Also the State Bank of
Pakistans monetary policy has been very friendly toward the banking industry.
There is a number different banks established in Pakistan, including local incorporated
commercial banks, foreign incorporated commercial banks, development financial
institutions, investment banks, discount & guarantee houses, housing finance companies,
venture capital companies, micro finance banks and Islamic banks.
Samba Bank Limited is a Pakistan-based banking company engaged in commercial
banking and related services. The Bank operates 28 branches inside Pakistan. It operates
through four segments: Corporate banking, Trading and sales, Retail banking and
Commercial banking. The Corporate banking segment includes services provided in
connection with mergers and acquisition, underwriting, privatization, securitization,
research, debts and equity syndication, IPO and secondary private placements. The
Trading and sales segment includes fixed income on debt securities, equity, foreign
exchanges, commodities, credit and funding, among others. The Retail banking segment
includes retail/consumer lending and deposits, banking services, trusts and estates,
private lending and deposit and banking service, among others. The Commercial banking
segment includes project finance, real estate, export finance, trade finance, factoring,
leasing, lending, guarantees, bills of exchange and deposits.
I did my internship at Samba Bank limited and worked in account opening, operations,
accounts, and car finance and credits department.

The work that I did in these departments included making proposals for loans, filling car
financing forms, collecting cheques, filling account opening forms, activity checking and
making a borrowers basic fact sheet.
Some of the problems found in the working of Samba Bank limited include less training
of the employees, incentive schemes and product innovation, less staff and long working
hours.
Some of the recommendations include workshops for employees, job rotation, teams
work to find innovative products and scholarship programs for employees.
Lastly Samba Bank limited has seen a rapid growth in its activities by introducing a range
of products and services and showing its presence in the country by opening new
branches and in future should keep this momentum and always strive to become the best.

Table of Contents
3

EXECUTIVE SUMMARY........................................................................................................... 2
INTRODUCTION........................................................................................................................ 6
ORIGIN OF TERM BANK............................................................................................................6
IMPORTANCE OF BANKING............................................................................................................6
HISTORY OF BANKING IN PAKISTAN.............................................................................................7
COMPANY BACKGROUND..............................................................................................................8
PEER ANALYSIS............................................................................................................................10
ORGANIZATIONAL STRUCTURE........................................................................................ 11
PRODUCTS & SERVICES....................................................................................................... 12
INTERNSHIP DURATION & RATIONALE FOR SELECTION......................................... 21
DETAILS OF TRAINING.................................................................................................................22
PURPOSE OF CREDITS..................................................................................................................24
4. OPERATIONS DEPARTMENT..................................................................................................31
SWOT ANALYSIS..................................................................................................................... 34
OPPORTUNITIES...........................................................................................................................34
THREATS......................................................................................................................................35
STRENGTHS..................................................................................................................................37
WEAKNESSES...............................................................................................................................40
MAIN PROBLEMS.................................................................................................................... 42
CONCLUSION........................................................................................................................... 44
RECOMMENDATIONS............................................................................................................ 46
REFERENCES........................................................................................................................... 49

INTRODUCTION

Origin of Term Bank

It has not so far been decided as to how the word Bank originated. Some authors opine
that this word is derived from the words Bancus or Banque which mean a bench. Other
authorities hold the opinion that the word Bank is derived from the German word
Back, which means joint stock fund. It is therefore, not possible to decide as to which
of the opinion is correct, for no record is available to ascertain the validity of any of the
opinions
"A financial institution, deals with money and credit. It accepts Deposits from
individuals, firms and companies at a lower rate of Interest and gives at higher rate of
interest to those who need them.
A financial establishment which uses money deposited by customers for investment,
pays it out when required, makes loan at interest, exchanges currency, etc.

Importance of Banking.
Banks play very important role in the economic life of a nation. The growth of the
economy is dependent upon the soundness of its banking system. Although banks so not
create new wealth but borrow, exchange and consume. These make generation of wealth.
In this way they become most effective partners in the development of that country. To
encourage the habit of saving and to mobilize these savings is its basic purpose. Banks
deposit surplus from the public and then advances the surpluses in the form of loans to
the industrialists, agriculturists, businessmen and unemployed people under different
schemes so that they setup their own business. Thus banks help in capital formation
if there are no banks, and then there would be concentration of wealth in few hands great
portion of wealth of a country would be idle. In the fewer developing countries rate of
saving is very low and due to this rate of investment and rate of growth is very low. We
can take hank just like a heart in the economic structure and capital provided by it is like
blood in it. As long as the blood is in circulation, the organs will remain sound and
healthy. If the blood is not provided to any organ then the organ would become useless.
So if the finance is not provided to agriculture sector or to industrial sector, it wills he
destroyed.
5

Loan facility provided by bank works as an incentive to the producer to increase

production. Banks provide transfer of payment facility, which is cheaper, quicker and
safe. Many difficulties in the international payment have been overcome and volume of
transactions has been increased. These facilities are very much helpful for the
development of trade and commerce.

History of Banking in Pakistan

The partition plan was announced on June 3, 1947 and August 15, 1949 was fixed as the
date on which independence was to take effect. It was decided that the Reserve bank of
India should continue to function in the dominion of Pakistan until September 30, 1948
due to administrative and technical difficulties involved in immediately establishing and
operating a Central Bank. At the time of partition, total number of banks in Pakistan were
38 out of these the commercial banks in Pakistan were 2, which were Habib Bank
Limited and Australia Bank of India. The total deposits in Pakistani banks stood at
Rs.880 million whereas the advances were Rs.198 million.
The Governor General of Pakistan, Muhammad Ali Jinnah issued the order for the
establishment of State Bank of Pakistan on 1st of July 1948. In 1949, National Bank of
Pakistan was established. It started with six offices in former East Pakistan. There were
14 Pakistani scheduled commercial banks operating in the country on December 1973.
The Pakistan Banking Council prepared banks amalgamation schemes in 1974 for
amalgamation of smaller banks with the five bigger banks of the country. These five
banks are as under:
1. National Bank of Pakistan
2. Habib Bank Limited
3. United Bank Limited
4. Muslim Commercial Bank Limited
5. Allied Bank Limited
In early 90s after the failure of nationalization policy, Government went for privatization
of financial institution. In last ten to fifteen years banking sector in Pakistan has shown
tremendous growth. Due to its remarkable growth, banking sector of Pakistan has become

very attractive for foreign investors. Many investors have already invested and still many
more to come.

Company Background
Samba Financial Group (formerly known as The Saudi American Bank), is a large
banking firm in Saudi Arabia. The combined institution had 66 branches in the Kingdom.
Its international operations consist of a branch each in London, Qatar and Dubai, as well
as a subsidiary that has 28 branches across major cities in Pakistan. Samba, or The Saudi
American Bank as it was once known, was established on February 12, 1980 with the
takeover of Citibank branches in Jeddah and Riyadh in accordance with a Saudi
notification program that forced all foreign banks to convert their branches to affiliates
with Saudi nationals acquiring at least 60% ownership. Citigroup entered a Technical
Management Agreement under which it agreed to manage the new bank. The former
Prime Minister of Pakistan, Shaukat Aziz, was the Managing Director of the bank in the
1990s.
First National City Bank (Citibank) opened its Jeddah branch in 1955, and its Riyadh
branch in 1966. Citibank created SAMBA, in which it took a 40% share, to take over its
branches in Saudi Arabia, pursuant to a Royal Decree on February 12, 1980. In 1985
SAMBA opened a branch in Istanbul that it closed after 1994, and at one point
maintained a subsidiary in Geneva and a representative office in Beirut. In the late 1980s
SAMBA opened a branch in London.
In July 1999 SAMBA merged with United Saudi Bank by an exchange of shares, to form
one of the largest banks in the Middle East. Before the merger Citibank owned 30 % of
SAMBA, having sold a 10% tranche to two public agencies in 1991. After the merger
Citibank was still the largest shareholder with 23 %of the shares. Kingdom Holding
Company (owned by Prince Al-Waleed bin Talal) also had a large share ownership
deriving from his ownership in United Saudi Bank.
SAMBA was always the acronym for the Saudi American Bank but the name was
changed to Samba Financial Group permanently in 2003 and all references to Saudi
7

American Bank were removed. This name change followed Citibank's decision to pull
out of Saudi Arabia and sell its by then 20% stake to the General Organisation for Social
Insurance. Officially, this was done due to the anticipated relaxation of laws governing
foreign banks' operations in the Kingdom. Some speculate that this was due to rising antiAmerican sentiment in Saudi Arabia. This has become more evident after the change of
the Saudi British Bankname as well to SABB in 2006. Nevertheless SABB is still
an HSBC partnership and they have changed their artwork and colors from Green and
White to the HSBC logo.
In March 2007, Samba Financial Group acquired 68% of Crescent Commercial Bank
Limited (CCBL) in Pakistan. CCBL, established in 2002, was formerly known as
Mashreq Bank Pakistan Limited, which in turn was the result of the merger in 2003 of
Crescent Investment Bank Limited and the Pakistan branches of Mashreq Bank psc.
In 2008, Samba opened a branch in Dubai. In February 2011 Samba Financial Group
entered into a Joint Venture in the United States and formed Samba Financial Group USA
to market a Private Lending and Private Investment Division. In August 2011, Samba
made the list of top ten safest banks 2011 in the Middle East ranked at number four.
Samba Bank Limited is a Pakistan-based banking company engaged in commercial
banking and related services. The Bank operates 28 branches inside Pakistan. It operates
through four segments: Corporate banking, Trading and sales, Retail banking and
Commercial banking. The Corporate banking segment includes services provided in
connection with mergers and acquisition, underwriting, privatization, securitization,
research, debts and equity syndication, IPO and secondary private placements. The
Trading and sales segment includes fixed income on debt securities, equity, foreign
exchanges, commodities, credit and funding, among others. The Retail banking segment
includes retail/consumer lending and deposits, banking services, trusts and estates,
private lending and deposit and banking service, among others. The Commercial banking
segment includes project finance, real estate, export finance, trade finance, factoring,
leasing, lending, guarantees, bills of exchange and deposits.

Peer Analysis
Company

Revenue

Net

income Market

Employees

KASB Bank Limited

Silkbank Ltd
JS Bank Limited
Samba Bank Limited
The Bank of Punjab

(TTM)
5.62bn
7.57bn
6.98bn
3.10bn
24.30bn

(TTM)
-1.47bn
-905.69m
405.38m
99.02m
2.34bn

cap
3.55bn
6.22bn
6.43bn
7.31bn
10.22bn

1.27k
1.26k
1.24k
450
3.69k

(Pakistan)
Soneri Bank Limited
Faysal Bank Limited
Askari Bank Ltd.
NIB Bank Ltd

13.85bn
27.68bn
29.01bn
13.42bn

902.55m
1.60bn
-3.93bn
1.77bn

15.71bn
16.80bn
23.39bn
25.24bn

2.64k
3.46k
4.36k
2.48k

ORGANIZATIONAL STRUCTURE
President (CEO)

Chief Operating Officer

Group Head
Regional Manager

Area Manager

Branch Manager
Operation Manager

Officers

Non-Clerical Staff

PRODUCTS & SERVICES

With the mission to provide all-encompassing banking services to the customers, Samba
bank Limited has a uniquely defined menu of financial products. Currently it is one of the
most comprehensive portfolios of personalized financial solutions that are customtailored to serve the requirements not only of conventional customers but also fulfill the
needs of the corporate sector:
Current Accounts
Samba Bank Limited's current account gives you easy & nonstop access to your money
with unmatched features. A worry-free account with low monthly balance requirement,
plus great features like Online Banking, ATM facility, etc. With Samba Current Account
10

you surely are going to find the checking account that makes your life easier and fits your
lifestyle.

Samba Sehel Current Account

Small surprises that make a big difference. Introducing Samba Sehel, a Current Account
that caters to your unique needs. Samba Sehel Current Account offers you a variety of
benefits absolutely free based on your monthly average balance. For new and exciting
features, please see the details below: you can choose to maintain Rs. 100,000, Rs.
500,000 or above.
Basic Banking Account (BBA)
If you only write a few checks a month or keep a small checking balance, a Basic
Banking Checking account is right for you.
Minimum initial deposit of Rs. 1000
Non-remunerative local currency current account
No limit on minimum balance, however the BBA account
is nil for a continuous six

will be closed if the balance

month period

Maximum two deposit and two withdrawal transaction allowed free of charge through
checks (cash/clearing)

per month.

Unlimited free of charge cash withdrawals only from Samba ATMs.

Yearly statement of account
Regular full service banking accounts / services are subject to charges / fees as per the bank's
current Schedule of Charges. Existing customers availing regular / full services banking may
convert into a BBA facility.
Samba Saving Accounts
A saving account is a simple, yet essential resource in managing your money. With Samba
Bank Limited, you can enjoy our flexible savings account to help your money grow.

11

Samba NRP-Accou
Samba Non-Resident Pakistani Account
One banking relationship to take care of all your financial needs. Now all you need is one
account to take care of all your financial needs even when you are far from home; the Samba
NRP Account from Samba Bank Limited in Pakistan.
With a Samba NRP Account, you can open an account at any Samba Bank Limited (SBL)
branch in Pakistan and perform banking transactions wherever you are - in Pakistan or in the
U.A.E.
Send money home to your loved ones in Pakistan
Book term deposits
Transfer money and pay utility bills in Pakistan
Issue pay orders or give standing instructions for regular payments in Pakistan, and

much

more.

Samba Inter Bank Funds Transfer

No more queues. No more banking hours. Now you can transfer funds up to Rs. 250,000
per day from your nearest Samba ATM to accounts at any 1 Link member bank or pay
loan installments, bills and other fees. The beneficiary can access the transferred funds
from any ATM displaying the 1 Link logo.
Benefits of Samba Inter Bank Funds Transfer
Send & receive money instantly.
Fast, Convenient, Simple.
24-Hour service through ATMs.
Secure (no cash, no cheques).
12

Samba Internet Banking

Samba Internet Banking Services, with no closing hours and no boundaries, is the
revolutionary banking technology which gives you access to your banking needs globally.
Just get on the Internet, anytime, anywhere and access your Samba Bank Account and
avail the following services.
Order a cheque book.
View, print or download up-to the-minute information about your account.
Account to account funds transfer (within relationship)
Account to account funds transfer (across accounts)
Lost & Stolen ATM Card blocking and replacement
Book a Term Deposit and inquire about applicable rates.
Subscribe/Unsubscribe to Samba SMS Alerts
Utility Bill Payments (KESC, LESCO, GEPCO, SNGPL, SSGC, Ufone Postpaid &
Prepaid, Warid Postpaid & Prepaid and Telenor Postpaid & Prepaid)
Change your Samba Internet banking password/PIN.
Inquire about exchange rates.
Samba Phone Banking
Samba Phone Banking gives you direct access to your account without physically visiting
the branch. Our customer service representatives aim to provide you with immediate
banking support and solutions. Samba Bank limited through its advanced technology also
offers one of the best financial solutions available in the market today.
To exceed the growing expectations and deliver a delightful banking experience, in a
highly competitive and dynamic business environment, Samba Phone Banking provides
immediate support with value added services as detailed below:

13

General banking information

ATM & Bank locations
Bank product information
Bank charges information
Account opening procedure & documentation
Bank account balance inquiry
Monthly installment & payment due date of Personal Loan
Outstanding balance and pay-off inquiry for Personal Loan
Samba ATM
The Samba ATM Card is easy to use, completely reliable and convenient. Imagine the
convenience of accessing your account and most of your personal banking without
having to regularly visit your branch. Samba Bank Limited is proud to offer this service
to its valued customers.
Allows you to access your funds 24/7 through any ATM in Pakistan including ATM's of
other banks and Cirrus and Maestro enabled ATMs globally.
Allows you to withdraw upto Rs. 50,000 cash daily.
Account to account funds transfer (within relationship)
Payment of utility bills (KESC, LESCO,GEPCO,SNGPL,SSGC, Ufone Postpaid &
Prepaid, Warid Postpaid & Prepaid and Telenor Postpaid and Prepaid)
Balance Inquiry and Mini Statement
Account to account funds transfer (across accounts)
Time Deposit Inquiry
Cheque book request
Speed Cash Now
Receive Cash from Saudi Arabiain seconds!
SpeedCash Now offers the facility to receive cash from family and friends through Saudi
Arabia's premier bankfast, free and conveniently!

14

Receive cash or get fund directly credited into your

Free of Charge for remitter and beneficiary, on

Samba Bank Accounts

transactions equal and above USD

100.
Easy to send cash from Saudi Arabia, easy to receive it

in Pakistan

Attractive exchange rates

To send cash, the remitter can simply visit any Samba SpeedCash Center in Saudi
Arabia
Samba Break-Free is a finance facility that lets you enjoy up to 95% against
your Savings and Time Deposit that you can use at any time, while your
deposit stays intact and continues to grow.
What's more
1. The facility is available on both Rupee and Foreign currency, Savings
and Time Deposits
2. Financing up to:
95% against Rupee Deposits
87% against Foreign Currency Deposits.
3. Fast processing with easy documentation
4. Minimal mark-up rate charged only on the amount used (not on the
entire sanctioned amount) and only for the period used.
5. Transparent pricing with no hidden charges
6. Easy and convenient payments on quarterly basis.

Pricing
Mark-Up: 3-Months KIBOR + 3.5% Spread (fixed margin)
The total mark-up charged will be on floating basis at 3 months KIBOR plus
Spread (fixed margin). In-case of first mark-up period, the 3 months KIBOR
will be used as of the date of application, however for all subsequent mark-up
15

periods, 3 months KIBOR of the last working day immediately before the last
mark-up due date will be used (i.e. last working day of March, June,
September & December). The Bank shall revise the pricing in accordance
with the change in 3 months KIBOR on quarterly basis, based on calendar
quarter.
Zero processing Fees.
ATM & Cash Insurance
You can now enjoy protection through insurance cover up to Rs.25,000
against unfortunate events like armed hold-up or forced snatching of cash.
Benefits:
ATM & Cash Insurance covers you at:
Any ATM across Pakistan (Samba Bank ATM or any other local bank ATM)
when

using Samba Bank's ATM Card.

Any Samba Bank ATM when using any other local bank's ATM/Debit
Card.
Counter of any Samba Bank branch.
All these benefits are available at a very low monthly premium of
Rs.250/- only.
Business Insurance
You can now enjoy insurance cover against unfortunate events like:
1. Fire and Lightning
2. Burglary
3. Riots and strikes
4. Act of terrorism
5. Natural disaster, etc.

16

Business Insurance provides coverage for:

Premises and structure
Contents and safe
Facial signage
Equipment
Samba Bank Limited is acting as a distributor of Business Insurance on
behalf of New Jubilee Insurance Company Ltd. and is not and shall not be
held responsible in any manner whatsoever to any person, including but not
limited to, the insured Customer(s), beneficiary (ies) or any third party.
New Jubilee Insurance Company Limited is the underwriter and provider of
this insurance cover and shall be responsible for settlement of claims to the
insured Customer(s) or beneficiary (ies).

Secure Future Plan

Secure Future Plan is a flexible life insurance plan specially designed for customers of
Samba Bank Limited. Secure Future Plan enables you to plan for long-term financial
requirements like children education, marriage, etc. It also protects your family from
future uncertainties.

Benefits:
1. Your savings are invested in the fund of your choice managed by NJI Lifes investment
experts, who ensure that your savings are optimized and well managed.
2. If you continue your plan for a period of more than 4 years, you will be entitled to
Continuity Bonus, whereby your investment will grow at a faster pace.
3. Option to invest your extra savings and top up your investments at any time during the
term of your policy.
4. Option to withdraw your funds (either fully or partially) after the completion of two
17

policy years.
5. Select your own life insurance amount, which will be paid to your family or loved ones
in case your (God forbid) death.
Retirement Plan
Retirement is that phase of life where one leaves all his troubles aside and takes time out
to relax and ponder over the achievements he has made over a lifetime. Retirement plan
enables you to plan for long-term financial requirements, and also protects your family
from future uncertainties.
Benefits:
1. Your savings are invested in the fund of your choice managed by NJI Life investment
experts, who ensure that your savings are optimized and well managed.
2. If you continue your plan for a period of more than 4 years, you will be entitled to
Continuity Bonus, whereby your investment will grow at a faster pace.
3. Option to invest your extra savings and top up your investments at any time during the
term of your policy.
4. Option to withdraw your funds (either fully or partially) after the completion of
two policy years.
5. Assures your family or loved ones a guaranteed level of life insurance protection while
you save for your retirement
Home Insurance
Home Insurance protects your home against unexpected damage caused by mishaps
from:
1. Fire
2. Lightning
3. Rains, storm or flood
4. Earthquake
5. Riots & strikes
18

6. Smoke
7. Theft or burglary etc.
Customer can select from any of the following 3 plans, which are not only flexible to
your needs, but affordable as well.
Home Insurance Plans
(In Rs.)
Home Structure
Household Structure
Jewellery
Cash at Home
Total Coverage
Annual Premium(Rs.)

Silver
500,000
125,000
70,000
5,000
700,000
2,500

Gold
1,000,000
500,000
290,000
10,000
1,800,000
7,500

Platinum
1,500,000
1,000,000
470,000
30,000
3,000,000
13,500

19

INTERNSHIP DURATION & RATIONALE FOR

SELECTION
I did internship from samba Bank to fulfill my degree requirements. During my
internship i worked in various departments of the bank. I have interest to join banking
industry after doing my degree and the reason for joining Samba Bank was that it is
among those few banks which performed remarkably well in less time and grabbed the
market share with their products, services and different banking experience. They
encourage young minds to come and work with them. It was a good experience from
learning and working point of view. The working environment of the bank is also good
and appreciating. It is one of the very few organizations who have special internee
programs. The employees of the bank are really cooperative and help a lot in providing
knowledge and expertise to the new entrants and internees I have worked in various
departments and gained knowledge not only about Samba Bank Limited but also about
rules and prudential of State Bank of Pakistan and competitor banks. Another reason for
selecting Bank was that they keep a complete record of the performance of the internees
and offer jobs to those after the completion of their degrees who performed well.
Working here will help me in working in any other organization as grooming and
learning here was really good and practical Moreover working environment, ambiance
within branch, appreciation by management, different products and services and
competition among the internees in the branch made me to join Samba Bank Limited for
internship.

20

Details of Training
The departments that I worked during this time are as follows:
Accounts Opening
Operations(remittances/moneygram)
Credits
Car Financing
1. Account Opening
Account opening department is one of the most important departments of a bank. It is
known as Gateway to the bank as anyone (any individual, partnership firm or
JSC) who wants to initiate relations or to avail the services of bank has to open an
account. This is why it is known as gateway to the bank. For opening of account a form is
given which includes all necessary requirements needed for further process.
This form also includes term and conditions of account holders and all details of bank
and customer relationship. (Annexure)Before opening an account there are certain
requirements.
Requirement for Account Opening
There are different accounts that can be opened with a bank. These are
Current Account
Savings Account
Basic Banking Account
Opening of an Account
When all requirements are fulfilled by the applicant, the procedure of account opening
starts. To open an account of any type, bank officer has to go through five different
windows of MYSIS than the account holder information is sent for verification.
21

1) ANC stands for Add New Customer

2) CIM stands for Customer Additional Information Maintenance
3) CAA stands for Customer Account Address
4) OCA stands for Open Customer New Account
5) ZYC stands for Know Your Customer
Allotment of Account Number
After going through the procedure above mentioned an account number is given to the
customer. One thing is very important for understanding that even going through the
above mentioned procedure successfully, it does guarantee the opening of account. After
allotment of account number it remains block for two days as the verification process is
in process in these two days. This is why account is inactive for its first two days.
Specialty of Account Number
Fourteen digits account number is allotted to the HBL account holder. The first four digits
are code of samba branch where account is going to be opened, afterward eight digits are
customer account serial number and last two digits indicates type of account. For
example
1416

75000254

Branch Code Account Serial

03

Type of account

22

2. Car Financing
While serving in car finance department i had to know the necessary documents required
to get a car and had to guide the customers accordingly while meeting them face to face,
phone calls etc. Also I had to tell customers about the tenure of finance, minimum down
payment, insurance companies details, prematurity charges, dealer, payment etc.
Procedure for Car Financing
The procedure for car financing starts when a customer comes and asks for a plan for a
specified car. When he receives this plan, he will fill an application form for a car
financing, stating the car he wants to finance, its color, personal details and two
references. They also pay a processing fee which is nonrefundable. The bank then
conducts a verification of the two references,. A Verisys is also conducted on the
applicants CNIC and a Customer Credit Information Report is taken from the CIB.
After the verification process is completed, a Credit Line Proposal (CLP) is generated by
Samba Bank Branch, to be sent to the Area Office for a final approval with all other
documents as well. The final authority of passing the application remains with the Area
Office.
After the Area Office approves the application, the customer will make the down
payment, give the bank postdated cheques and sign a legal document with the bank.
When this process is complete, a quotation is sent to the car dealer for the specified car,
insurance documents are sent to the specified insurer. Later on the car is registered with
the Excise and Taxation Officer and is given a number.
When all this process is complete, the key to the car is handed over to the customer with
all documents relating to the car. When the tenure for the car financing is completed, the
bank issues a NOC to the customer.

23

As part of my internship I also had to complete the final legal document signed by the
customer, by writing in detail about the car, the financing period and witnesses pertaining
to the agreement etc.
3. The Credits Department
The sum of money that a bank makes available to client in excess of any deposit. Credit
means belief or trust. The quality of being credible or trustworthy. Another words we
can define credit as trust in ones integrity in money matters and ones ability to meet
payment when due.
Purpose of Credits
Earnings of a bank are dependent on CREDITS, because:

A bank receives (borrows) deposits. It pays cost on these deposits.

On the other hand bank lends the deposits to borrowers and charges interest on the
lending. This function is performed by CREDITS in any bank

Importance of Credits
CREDITS are the most important department of a bank. Performance of all other
departments is dependent upon Credits. It attracts corporate accounts, as a company
prefers to do import and export business from the banks from where it is availing limit
(credit) facilities.
Risks involved in Lending

24

Though lending is main source of earnings for any bank but it is risky as well. Whenever
money is advanced to any customer there is always a risk involved of default. To
minimize the risk involved BAL gives loans to credible customers.
Sub Division of Credits
CREDITS are further sub divided into two sections:

Credits Marketing

Credits Administration

The above-mentioned two sections perform the overall activities of credits. Role of each
section is discussed below:
Credits Marketing
Marketing personnel is responsible for attracting customers to bank for advancement of
loan facilities. They must have complete information of trends in the industry. However
several precautions are followed to give loans to only credible customers, as the aim of
bank is to recover the money at time and through earnings of the client and through
liquidation of securities.
Bank Alfalah Ltd. always prefers to give loans to credible customers. For this BAL
requires information about:
Basic Cs of a Credit:
Character
Who is the borrower (company)? What is its reputation for honesty, integrity and
willingness to pay?
Capacity
25

How is the business managed? What are its strength weaknesses? What is the business
capacity to generate the funds to repay?
Capital
How solid are its financial and human resources? Are financial resources matched with
adequate human resources?
Conditions
What is the condition of company within the economic cycle? Will the economic and
business conditions impact the borrowers ability to repay?
Collateral
What is the real liquidation value of the collateral? If the creditor is forced to use thee
collateral as payment, what value will be realized at liquidation?
Carelessness
While evaluating, disbursing and monitoring of the credit, professional standards and
tools are not exercised.
Complacence
When the information and data base on which decisions are to be made, are accepted
without any critical evaluation
Connivance
While certain adverse aspects observed in the operating performance, financial position,
debt servicing, etc. are not accounted for which tacit understanding of favoring the client.
Concealment
When certain important facts are deliberately and willfully conceal from the management
which could have undermined security, credit recovery and bilateral relationship with
borrower.
Collusion
When a bank officer and borrower willfully join their hands for achieving some ulterior
motives
Corruption
When official matters are dealt with for financial and non- financial benefits at the cost
of the lender

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Credit Administration
It is the second section of CREDITS. It performs very important functions for the bank.
After the approval of CREDIT LINE PROPOSAL, it comes to Administration section.
The Administration decides the terms and conditions regarding securities offered against
the facility given to a client. It is a highly responsible task because in case of default
liquidation of securities is an important source for bank for recovery of loan amount.
Other important functions such as adjustment of loans are also handled by administration
section.
Credit Line Proposal (CLP):
A CLP contains and takes into consideration following information:

Types of Proposal:
o New
o Renewal
o Revision
o Single transaction

Names of owners and their shareholding

Nature of business

Existing and proposed limit for funded and non-funded facility

Group Exposure for both funded and non-funded facility

Purpose of each facility and Repayment

Security both existing and proposed

27

Customer Profile:

LEGAL STATUS: It specifies legal status such as:

o Individual
o Proprietor
o Partnership
o Limited liability company

Date if Incorporation

Date of Account opening and Account Number

History of Relationships with Bank

History of Borrowing Relationship

Information of whether account opening formalities are complete or not

Line of Business/Main Products:

Following information is required in this regard

Sales break-up in various cities

Market share

Competitive brands

Industry Profile and Market Position

Summary of key Financials:

It includes following ratios:

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Sales/Revenue, Net Profit

Total Assets, Liabilities

Working Capital, Current Ratio

Paid-up Capital, Reserves, Net Worth

ROE, Debt-to-Equity Ratio

Days Receivables, Days Payables, Days Inventory

Guide Line Of Credit Policy

Total outstanding financing facilities by banking company to single person shall
not at any point of time exceed 30% of banks unimpaired capital.
No banking company shall make loans or advances against the security of its own
shares.
No banking company shall grant unsecured loans / advances on the guarantee of,
o Any of its directors.
o Family member of director
o Any private company in which banking company is interested.
In arriving at exposure per person weight age of 50% shall be given to
o Documentary credit opened by bank.
o Guarantees/bonds other than repayment guarantees.
In arriving at per party exposure 90% of
o Deposit of party with bank under lien.
o Face value of FIBs lodged by the party as collateral.
o Pak rupee equivalent of face value of special US Dollar bonds converted
at official rate, lodged by the party as collateral shall be deducted.
Aggregate exposure of bank against all its clean facility shall not at any point
exceed the amount of banks capital and general reserve.
Advances given to the employees of bank in accordance with their entitlement.

29

 While granting any accommodation, bank shall ensure the total accommodation
availed by any borrower from banks / financial institution does not exceed 10
tines of the capital and reserve of the borrower.
A borrower who is prepared to inject fresh equity irrespective of the fact that its
equity is negative is eligible to obtain finance from bank to the extent of 10 times
fresh injected equity.
No banking company allow financing facilities whether fund based / non funded
against the shares of companies which are not in central depository system.

My experience at the Credit Department:

Corporate credits was the second last department in which I was been rotated. The most
important department in any bank is considered to be the Credits department. This is, in
my opinion, is also true due to some reasons. Firstly the reason being that in credits
department, the decision-making skills of a person are explored. When you need to make
a decision regarding the credit proposal after due verification, this will give a little stress
to your mind either to sanction the financing or not?
Credits involve very technological procedures and also a lot of exciting activities
because each case varies from the other one. You never become unenthusiastic because
you get an opportunity to walk around new bits and pieces every time.
In this department I worked under the supervision of Credits Officer. He was also very
supportive to me. He taught me the credit line proposal from the first step till the end of
its filling process. In the nutshell, the credits department contributed a lot towards my
decision-making and learning skills.

4. Operations Department
As in clearing, accounts and remittances department has very less work to done so they
30

are combined in single department here in Samba Bank Limited. This department is
collectively called Operations department and 2 people work over here. Procedure of
clearing a cheques.

Checking of cheques

Inward and outward clearing

Within bank transfer

Different reason of returning a cheques

Types of clearing stamps

I learned weekly, monthly, bi-annually, annually and quarterly reports that are sent to
main branch and head office and even to SBP. Most of these are prepared by system
automatically. Two main functions performed by this department are daily activity
checking, report generation. Main reports prepared are;

Daily Advance And Deposit Position

Daily Exchange Position

Daily Fund Management

Closing Reports

Monthly Budget Review Report

Monthly Monitory Statement

Monthly Performance Review Report

In remittances I gained knowledge about inward clearing and outward clearing.

She told me about following things;

Demand draft (D.D)

Pay order (P.O)

Local remittances and outgoing remittances

Schedule of bank charges for remittance

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5. Cash Transfers
The cash transfers in the transact department are responsible with the cash deposits and
withdraws made by Samba Bank account holders. There are two types of cash withdraws
and deposits.
As part of my internship, I was responsible to collect cheques from the customers that
they deposited, put the official stamps on the different kinds of cheques, register the
return cheques in a register and make OBC schedules. payment of markup, due dates,
acceptance of proposals

32

SWOT ANALYSIS

Opportunities
The opportunities on which Samba bank can capitalize upon are delineated as under.
1)

Extension of Local Branch Network

One of the biggest opportunities for Samba bank limited is to extend its branch network
in Pakistan. The essential pre-requisites for a vast branch network are all there; sponsors
have the money, managerial expertise are available, and last but not the least any bank
with Bank Alfalah Limited written in blue at its front is accepted in the market.
2)

Establishing Foreign Branch Network

Going global could have been termed as a fad a few years ago, but now for those business
organizations that want to survive and thrive globalization has become the order of the
day. In order to increase the bottom line figure, it really is crucial. But the senior
management would start implementing this course of action once they feel that they have
got a strong hold in Pakistan.
3)

Capitalizing On Information Technology

The information revolution has certainly made its inroads in almost all human functions.
If Bank Alfalah Limiteds senior management and the IT division make a concerted effort
to make best possible use of this miracle of human mind it would enable Bank Alfalah
Limited to harness unexplored benefits of immense magnitude.

33

4)

Unexplored Market of Multinational Corporations

Unfortunately in spite of unprecedented image building efforts, Bank Alfalah Limited

still is an unattractive bank for big multi nationals functioning in Pakistan. If the
management is able to develop a strong relationship with such MNCs then it would open
doors of huge and unimaginable opportunities for Bank Alfalah Limited. If even a single
MNC becomes a corporate client of Bank Alfalah Limited i.e. it deposits its revenue with
Bank Alfalah Limited, pays its salaries through Bank Alfalah Limited, does trade dealings
through Bank Alfalah Limited, and avails credit facilities offered by Bank Alfalah
Limited, it would make a world of difference to Bank Alfalah Limited.

5)

Customers are more willing

Muslims are more consciously differentiate the Islamic-base banking from interest-base
banking. That is why there is large caution of expansion.

Threats
The predominant threats Samba Bank limited is facing at the moment are discussed in the
following lines.
1)

Private Sector Banks

Samba Bank Limited is at present facing really tough competition from not only the first
line international banks (ABN AMRO, Standard Chartered, Citi Bank) but is also having
a neck to neck race with other privatized banks such as Askari Commercial Bank
Limited, Union Bank, Prime Commercial Bank, Faysal Bank Limited, Bank Al-Habib
Ltd etc. All the new schemes launched by these banks and their plans to expand branch
networks are a real threats.

34

2)

New Trade Polices

Introduction of new trade policies and laws are also been a source of threats to the
organization due to the imposition of new rules and terrifies, previous maintained
regulations have to be amended.
3)

Network Expansion By Foreign Banks

Foreign banks have a lot of plus points as compared to Pakistani banks (state owned and
private); they have better products, better and personalized service, desirable interest
rates, foreign branch network, but they definitely lack in local branch network (in
Pakistan). Literary no foreign bank has been able to expand its network to far-fetched
places of Pakistan. Pakistani banks (private banks in general and state owned banks in
particular) are spread all over Pakistan. This is an intangible asset for Pakistani banks.
But if any of the foreign banks expands it network, backed by their traditional powerful
service, then it might prove to be the start of downfall for Samba Bank Limited, unless
and until Samba Bank Limited raises its level of service and product feasibility to the
international standards.
4)

If Pakistani Banks (Especially State Owned Banks), Backed By Huge

Network Improve the Service They Give And Their Employee Skill Set
State owned banks like National Bank of Pakistan and Habib Bank Limited have huge
networks, they have the experience, but the only set back they have is below par service
and lack of motivation amongst the employees. If their corporate strategy is altered, and
the managerial policy is revitalized, enabling them to improve upon the service they give
and enabling them to convert their work force into human capital then such financial
institutions backed up by their huge networks pose a potential threat to Samba Bank
Limited. So, Samba Bank Limited should endeavor to expand their branch network as
efficiently as possible and as soon as possible.

35

5)

Terrorist Image of the Country

After the 9 / 11 incident every kind of transaction that uses to take place with the outside
world has assumed a different mode. The trade finance transactions are the bread and
butter for the commercial bank, were also hampered by that terrorist attack on 11 th of
September i.e. the magnitude of orders the exporters were receiving decreased by a great
deal, but as far as our image in the international community is concerned there is still a
considerable room for improvement. If this situation further aggravates rather than
improving, the trade finance business would really be hampered, and one of the major
earning avenues for Samba Bank Limited will lose its footings. This fact poses a real
threat to the sanctity of Samba Bank Limited.
6)

Inconsistency in Government Policies

This is a phenomenon that could hamper smooth functioning of any organization working
in a particular country. Any drastic change in either the economic policies like increase in
taxation rates, or any change in the foreign policy, which could hurt Pakistans image
could also shake the investor confidence and also could lead to a decrease in the repute of
the entire banking sector of Pakistan.

Strengths
The predominant strengths of Samba Bank Limited are
1)

Humble Management

The senior management of Samba Bank Limited is considerably humble. Their humility
is an integral part of the organizational culture of the bank. The modern management
techniques have discarded the bureaucratic style of management in which employees
were treated as servants if not as slaves. In the contemporary business world employees
are said to be the biggest and the most crucial assets of a business concern, specifically if
36

we are talking about a service industry and this is precisely the management policy
Samba Bank Limited follows. The humility of the management serves as a big morale
booster and encouragement catalyst for all employees in general and new inductees in
particular.
2)

Kaizan

Kaizan is a process of continuous improvement in production and every aspect of value

added (Japanese). In a very short time span the management of Samba Bank Limited has
been able to develop its image in a very effective and efficient manner. Through the
laborious efforts of the top management and the employees, the entire organization as a
whole has been able to continuously add its prestige as a reliable, service oriented, and
flourishing financial institution. When we compare the image of Samba Bank Limited at
its inception with its present image we find an even greater difference. This fact proves
the thesis that there has been continuous value addition. The number of individuals and
corporate entities that feel comfortable while dealing with Bank Alfalah Limited is
increasing on a daily basis.
3)

Vastly Experienced Management

The people who occupy the top positions in Samba Bank Limited hierarchy are certainly
no mugs at what they do. Rather they are as capable and as competent as they come.
Their superior management skills certainly do create a synergistic effect when coupled
with the enormous amount of trust sponsors have put in the management. One of the most
evident proofs of above average management expertise are the deposit portfolio growth,
profitability growth, and branch network growth figures shown under the previous
heading.
4)

Highly Trained Human Resource Department; Transformation Of Work

Force Into Human Capital

One of the most significant catalysts, management of BAL had incorporated---and it still
is incorporating---in the organization, when H.C.E.B was transformed into Samba Bank
Limited, was induction of young and energetic business graduates. This was done in

37

order to achieve quite a few objectives; one was to raise the overall skill level of the work
force so that service provision could be improved and the second objective was to reduce
the average age of Samba Bank Limited employees so that an overall sense of change is
trickled down to the grass root level of the organization. Samba Bank Limited has an
excellent selection / recruitment and training program which are undertaken at its
Training and Development Center, Human Resource Division Karachi.
5)

Superior Consumer Finance

In contemporary banking consumer finance has assumed immense significance, as it is

that department of a commercial bank whose personnel directly and extensively deal with
the client body. One of the most predominant sub departments of consumer finance is
Samba Car Finance. The customer interface is greater in the consumer finance
department, and the diligent staff of Samba Bank Limited enriched with its superior
service and relationship skills attracts / persuades these clients to develop relationship
with Samba Bank Limited in the arena of corporate banking as well. Thus a strong
consumer finance department really helps the bank to expand its corporate banking
business.
6)

Crucial Location Of Branches

All the branches of Samba Bank Limited are located at extremely crucial and vital
locations, which is indeed a very significant factor towards earning more profit.
Moreover all of the branches are very well furnished which is an integral characteristic of
a good bank in this age of consumerism.

38

Weaknesses
The chief weaknesses are enlisted as under
1)

Small Size

Samba Bank Limited is small in size; there is no doubt about this fact. Although, as I
mentioned in the strengths section, the branch network is expanding at a phenomenal rate
but still the size is not big enough as compared to some of the big banks present in the
market. Samba Bank Limited has 28 branches in the whole of Pakistan. A huge branch
network is always an invaluable asset for any bank. Customers simply love it when they
could see another branch of their own bank at every turn they take. Extensive branch
network might reduce per branch profit but it is very likely to raise the overall profit
figure for the entire organization as a whole.
2)

Lack of Research Cell

There should be a research cell in the bank, which should be engaged in gathering the
information about the present actions of its competitors
3)

Uneven treatment with customers

Customers having accounts with small amounts are not given same services and dealing
given to those with high accounts.
4)

Skill Set Of Employees Is Not Up To The Mark As There Is No Job Rotation

The contemporary banking all over the world has taken a unique turn i.e. they have made
job rotation an integral part of their management philosophy. Job rotation adds value to
every single employee, as he is able to perform a variety of jobs related to banking
profession. Moreover job rotation increases the human capital pool of the organization as
everyone is trained in more than one sphere of banking. Samba Bank Limited completely
lacks this.

39

5)

Foreign Banks Still Are A Little More Prestigious

Although Samba Bank Limited is continuously adding to its prestige, but still it cannot be
rated as a bank with the same repute as International Banks functioning in Pakistan, for
instance ABN AMRO Bank, Citi Bank and Standard Chartered Grindlays. Banks function
as custodian of peoples possessions, act as their agents, represent clients in trade
dealings outside the country, and give different types of guarantees and in all of these
transactions repute plays a central role. And when it comes to repute foreign banks have a
little more of it as compared to Samba Bank Limited.
6)

No Advertising in Electronic Media

Samba Bank Limited does embark upon occasional sales promotion activities, it also
gives advertisements in the print media, but it has never flashed an advertisement on the
television screen, which is said to be the strongest of all Medias. Some other commercial
banks are really capitalizing on the power of this media; examples are Askari commercial
bank, Muslim commercial bank, Habib Bank Limited etc.

40

Main Problems
The main vision Samba Bank Limited is to become a premier banking institution in not
only Pakistan but also abroad. In achieving this mission, Samba Bank Limited has been
successful by increasing its revenues, deposit base and branches in Pakistan. Although
there are no major problems at Samba Bank Limited, some of the problems observed are
as follows:
Technological Advancements
Samba Bank Limited has equipped its branches with all major IT tools being used in the
industry like ATMs, fax machines, photocopiers, printers, latest computers and a good
connectivity architecture, however it has been observed that when customer traffic is
high, there are many failures seen in the different devices used by Samba Bank Limited,
especially its connectivity architecture and remains offline with the main server, that
creates problems for the customers.
Job Advancements
There is no job advancements procedure for lower staff members or junior executives that
have joined recently at Samba Bank Limited. The main problem that was observed was
that the lower staff should be trained about the operations of the bank and also the junior
executives should be given promotions by defining the criterias like performance etc.
Working Hours
Samba Bank Limited although providing the customer service in better way but there is a
lot of work to do in a routine banking to the employees due to which they work for long
time. Management should gave relaxation to the employees by hiring new professionals
and reduce the working hours.
Lack of Employees in some Departments
Although Samba Bank Limited is a very good employer of talented professionals at
different branches, however, it was observed that there were some departments in the
bank that lacked the number of professionals in it that resulted in efficiencies in that
department.

41

New Products Introduction

Samba Bank Limited has a wide variety of financial products to cater to the needs of its
competitors; nonetheless the main problem seen is that it is not introducing innovative
products like other banks in Pakistan, for example Standard Chartered Bank introduced a
self-depositing machine, a machine that can be used by consumers to deposit money at
any time of the day.
Facilities at Branch
Providing amenities like a separate room for prayers because currently the employees
pray in the conference room of the branch. Also separate rooms should be made for the
account department for sorting of vouchers as it is also done in the conference room.
Incentive Schemes
There are no incentive schemes for employees of Samba Bank Limited like scholarship
schemes for employees that want to pursue higher education. Samba Bank Limited
although gives a number of incentives to its employees, like personal loans at nominal
markup but they are only provided to employees that are in higher ranks.

42

CONCLUSION
The economy of the country is booming and with the investment favorable policies and
their smooth implementation, the role of banks in todays economy have become an
important one.
The banking industry is also reaping the fruits of this economic boom by growing rapidly
over the past few years. There are a number of mergers happening in the economy with
foreign investments coming into the banking sector.
It has been years since the establishment of Samba Bank Limited, and since its
establishment it has aimed to become the leading bank of Pakistan by that provides
outstanding services to its customers.
The bank has seen phenomenal growth in the past few years by opening more branches in
the country, increasing the deposit base, while also increasing the assets and profits of the
bank.
The services that Samba Bank Limited provides have a great market penetration not only
because of their features but also the profit and markup rates that they charge. Also the
products that Samba Bank Limited provides cater to sector of the economy.
The top management of the bank is always developing strategies that cope with
unexpected challenges to deliver products and services more efficiently.
Furthermore, as the bank is growing, the number of employees at Samba Bank Limited
are increasing, which shows that Samba Bank Limited is being considered as a an
employer, that provides its employees with a challenging environment to work in, where
they can harness their full potential and shows confidence as an employer by the
employees of the bank.

43

Lastly to become the leading bank of Pakistan, Samba Bank Limited has to benchmark its
services to its major competitors in the industry or the market leader in the industry and
provide a continuous mean of improvement in its existing products and services, while
introducing new ones to the industry.

44

RECOMMENDATIONS
Some of the recommendations that I would recommend to some of the problems
discussed in the above section, that might increase the efficiency of both the operations
and employees of Samba Bank Limited are as follows
Technological Advancements
Samba Bank Limited should develop a modern connectivity architecture to effectively
maintain an online connection of the branch with other branches and also the ATM link,
which may include using modern technologies like fiber cables, routers etc. Also backup
links should also be developed,
Also a proper IT department should be established in all branches, with professional
having the knowledge to maintain a secured connection with other banks. Also scheduled
backups of data should be done with in the bank.
Workshops and Counseling
Work shop programs should be conducted in every city, rather than just two centers, for
all Samba Bank Limited employees. These workshops should relate to all aspects of
banking and may also be conducted with other banks as a joint program.
Also as parts of the human resource training, counseling programs should be started for
junior executives or new entrants into the bank, introducing them to their prospects in this
industry.
The lower staff employed Samba Bank Limited should also be given a chance to succeed
in life by training them in different simple jobs at the bank, which may include sorting of
cheques, phone banking etc
Incentives
Incentive schemes should be developed for the employees that can help motivate them,
which might include:

45

 Personal loans and car financing facilities for all ranks of employees.
Scholarship programs for all employees.
Introducing employee awards at branch and regional levels.
Job rotation programs to enhance the skills of employees.
Business Development Department
Business Development Department should be developed in all branches as in the past , so
that they can actively find prospect customers to take up products from Samba Bank
Limited and keep good relationship with the customers and keep good name of bank in
the market.
Innovative Products
New and innovative products should be introduced by Samba Bank Limited, like other
bank such as Citibank and Standard Chartered Bank develops for their customer. For this
purpose, special teams should be developed that include professional from all
departments of the banks to come with ideas. This process will increase the number of
ideas generated and even produce innovative products for the bank that might give them
the edge.
Placements of Employees
There are some departments in the bank that do not have enough employees, while some
have more than needed. All this creates inefficiencies and so the operations manager
should look at the department of the branch and see where inefficiencies lie, in
consultation of with the heads of the departments and hire individuals where there are
less employees or rotate employees from other departments.
Amenities in Branch
There should be a prayer room developed in all branches as many employees want to
pray, but do not have the proper place to do it. Also work like sorting, which takes up a
lot of space should be done in a separate place and amenities like television and internet
connection should be placed in the common room, so as to give employees a relaxing
environment when they have a break
Increments and Promotions

46

Samba Bank Limited has not been good in providing increments and promotions to its
staff members for the past three years due to which it has also lost some of his hard
working employees. The top management should look in to this matter seriously as
banks employees are its main strength and due to their hard work it has achieved such a
good position in the market.

47

REFERENCES
Samba Bank Limited( http://pak.samba.com/english/index_01_01_en.html )
Dawn News (www.dawnnews.com.pk)
Wikipedia (www.wikipedia.com)
State Bank of Pakistan (www.sbp.org.pk)
Annual Report Samba Bank Limited 2013
Managers Today

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49