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PROJECT
TOPIC: AL-BARAKA Islamic bank limited
Objective of Study
The purpose of the study is to work in a real life situation and to
apply management skills. In this context its objectives are:
To review the Banking environment of Al Baraka Islamic
Bank (AIB).
To analyze different working areas associated with Bank.
To analyze the strengths and weaknesses of the Bank and
its Banking Practices.
To suggest possible solution in front of Bank Management in
order to devise their Practices in a better way.
To analyze banking operations i.e. operational analysis,
financial analysis etc,
To do practical work in field and apply the knowledge of
classroom lectures to the real life situations,
To suggest concrete and feasible recommendations.
Scheme of Study
This internship report is divided into five chapters the detail of
which is given below
Includes objectives, limitations, merits, methodology, and
scheme of study.
Includes background and history of banking in Pakistan,
Historical background of AIB Branch, Abbottabad,
Organizational Structure, roles, functions and branches.
Is about the Financial Position and Products and services
provided by Al Baraka Islamic Bank (AIB)
Describes financial, SWOT analysis and findings of the study
INTRODUCTION
Like many other subjects and social sciences no any precise
definition can be given for the study of banking also keeping
in view the particular function of banking. It is clear that
there is a big difference in functions performed by old
institutions and modern baking. But the basic idea is same
banking has now become a multi-service organization with
wider scope and area of its influence .Mr. Gilbert says bank
is dealer in capital or more peculiarly in money. He is an
intermediate party between borrower and lender. The
definition lay down in the banking companies Act 1962 is
"Bankers means a person, transacting the business of
accepting for the purpose of landing or investment, of
deposits of money from public, repayable on demand or
otherwise and withdraw able by cheque, grafts or orders or
otherwise and includes any "Post office saving Bank".
In view of the above definitions, in simple words a bank can
be defined as an institution dealing in money, accepting
deposits and advances loans.
BANKING IN PAKISTAN
Banking industry in Pakistan has passed through various
transitional phases. The State Bank of Pakistan regulates the
banking sector, consisting of the commercial banks, along
with all NBFIs, except for the leasing companies. The IMF
experts in their reports said that banking industry has
developed to cater to the local needs of the financial sector
as well as it is highly competitive to serve the customers
globally. In the past it never attracted the customers, as the
interest rates were higher as compared to other countries in
the region. Taxes were all time high. Recoveries were hardly
Present Status
Currently the authorized capital of Al Baraka Islamic is US $ 1.5
billion, while the total equity amounts to about US $ 1.5 billion.
The Group has a wide geographical presence in the form of
Subsidiary banking units in, which in turn provide their services
through more than branches. Currently there are 496 employees
working at different branches of Al Baraka Islamic at Pakistan.
Credit Rating
JCR-VIS Credit Rating Company Ltd. has reaffirmed the medium
long term rating of Al-Baraka Islamic Bank BSC - Pakistan
Branches at A ( single A) with a stable outlook, the shot term
rating is A-1 (Single A-one).
Auditors
Ford Rhodes sidat Hyder & Co., Chartered Accountants, being
eligible, have offered themselves to act as auditors of the Bank
for the year ending December 31, 2016
AUDIT
COMMITTEE
SHARIAH BOARD
COUNTRY
MANAGER
REGIONAL
MANAGER
BRANCH
MANAGER
Regional
Manager
SOUTH
HJJ
Chief
financiof
Head
al
Officer
Head
of HR
COUNTRY
MANAGER
Regional
Manager
Central
Head
of
Audit
Head of
IT
Regional chief
Branch Manager
Regional
Manager
North
Head of
Treasury
Our Vision
To be a leading and a diversified International Islamic Bank,
Offering a wide range of Quality Products and Services and
forming strategic alliances for a Competitive Edge.
Mission Statement
We strive to be a Premier Regional Islamic Bank, Dedicated to the
Economic and Social Development of our target market,
Maximizing our Clients and Shareholders Value And focusing on
the Human Resource Development In an environment of
Creativity and Innovation.
Corporate Profile
The Corporate Profile provides a comprehensive summary of the
organization. The Profile contains the following information:
% Earned Growth
% Profit Rate (ROE)
Beginning of the Year Book Value o Earnings
12 Month Earnings per Share
Annual percentage Change o Dividends
% Payout Ratio
12 Month Dividends per Share
Proprietary Wright Quality Rating
Departmentalization
The Al-Baraka Islamic Bank has number of interrelated
departments that works together to achieve the specific goals
and objectives of the organization. The AIB has built a
hierarchical system that includes the sub departments. The
AIBs exiting system includes following departments.
Cash department
Deposits department
Clearing department
Advances department
Remittances department
Government department
Demand Draft
Letters of Credit (L/C)
Letter of Guarantee
Travelers Cheque
Pay order
Foreign Remittance Islamic Export Financing
Foreign Currency Accounts
Current Account
Saving Account
online Banking
ATM Network
Lockers Al Baraka Islamic Bank
Utility Bills
STRENGTHS
Commitment to Islamic Shariah Striving to develop and an
integrated Islamic Financial System . Compliance with the
rules and principles of Islamic Shariah is the core of the
banking and financial activities of the Bank. To this end,
Albaraka has successfully sought the advice and expertise of
Islamic scholars acclaimed for their knowledge and piety
from all over the Islamic world to guide its path and monitor
its performance. The Banks activities and operations are
regularly scrutinized by its Shariah Advisory Board.
Experienced and Qualified Staff During the research it has
been observed that the staff/personnel of the organization is
qualified and experienced. Many of the bank officials have
got advance knowledge and experience in the fields of
management, banking law and practice.
Good PR with Customers The relationship of the manager
and the other staff of the organization is really good with the
customers, which results in good will and loyalty of the
customers towards the organization.
Good Managerial Skills The managers are fully aware of the
recent managerial concepts and are able to deal with any
type of scenario.
Job Satisfaction at All Levels
Job satisfaction is one of the important factors for the
employees to be motivated. The people in the organization
under consideration were found highly satisfied with there
jobs.
Quarterly Performance Appraisal Performance appraisal is
the way by which one can evaluate the employees
performance; it results in the enhancement of the
organizations overall performance. The performance
WEAKNESSES
Less internal recruitment for new posts -It has been found
that in the organization under consideration, if new
vacancies are allocated there is a trend of external
recruitment, which results in the dissatisfaction of the
current employees.
OPPORTUNITIES
More qualified people in the market Due to the increase of
interest of people in business field, many business
institutions have been established, which produces a good
lot of qualified and competent business professionals. So,
the organization under consideration can hire more qualified
people from market.
Effective utilization of internal human resources People
working in the organization get use to the norms and values
of the organization, so these expirees can be utilized with in
the organization whenever required.
Training can enhance the employees skills. Training and
development is one of the important function of human
resource management. If the staff of the organization are
properly trained and developed they will add to the value of
the organization.
THREATS
Increase in Competition-The increasing competition in local
as well as national and multinational level also lower down
the profitability of the bank and compelling the bank to use a
large amount of funds to meet out competition.
Recommendations
As I have spent two months in AIB Abbottabad Branch for the
Internship purpose. During this period I have tried my best to
observe the banking environment in the AIB. I have observed a lot
of strengths and weaknesses in the branch. On the basis of this
observation I have come up with certain recommendations
particularly related to the AIB, Abbottabad Branch but generally
can be applicable to the whole banking system of Pakistan
including all other branches of Al Baraka Islamic Bank for
improvement. These recommendations will help to cope with the
problems being faced by the Bank and will enhance the efficiency
and performance of the AIB in particular and all the banking
sector of the country in general.
References
Al-Baraka Islamic Bank (2009), Annual report 2008, Lahore.
DeCenzo D.A & Robbins S.P (2004); Fundamentals of Human
Resource Management,8th ed. John Wiley & Sons .
Hussain, S; Rana, K & Shabbir, A (1991); Banking Currency and
Finance, Lahore: Ilmi Kutab Khana.
Waleed (2010); Interview with Mr. Waleed, Manager Operations,
Al-Baraka Islamic Bank, Abbottabad, 11 March, 2010
Tariq Mahmood (2010); interview with Mr. Tariq Mahmood, Branch
Manager AIB, Abbotabad branch, 15March,2010.
Tamuja Agarwala (2008); Strategic Human Resource Management,
7th ed. Oxford University Press, New Delhi, India .
www.ibp.org.pk (Accessed date 03-06-2010)
www.albaraka.com.pk (Accessed date 15-06-2010)
www.abg.bh/English/home2.html (Accessed date 20-06-2010)