Habib Bank Ltd. Internship Report, 2010 Executive Summary Department of Management Sciences demands every student of BBA/MBA program to go a procedure of 4 to 6 weeks internship course and to present the report based on the observations and work done during the training practice. It is actually the appraisal of any organization currently running its business, having its competitors. It is also meant for discovering the weaknesses and shortcomings and then giving the suggestions for perfection. I have fulfilled my eight weeks internship at Habib Bank Limited, The Islamia University Branch Bahawalpur and tried my level best to achieve something sensibly from this opportunity. In my internship I opened many accounts of the customers; most of them were the employees of The Islamia University. I also did a lot of work on the pension and salary days. As there is a bunch of crowd on these days so I helped the staff of the bank by filling out the pension forms and then recording the entries in the register of the Pension Records. In this way we winded up the work quickly and in less time. 1
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Habib Bank Ltd. Internship Report, 2010
Executive Summary
Department of Management Sciences demands every student of BBA/MBA program to
go a procedure of 4 to 6 weeks internship course and to present the report based on the
observations and work done during the training practice. It is actually the appraisal of any
organization currently running its business, having its competitors. It is also meant for
discovering the weaknesses and shortcomings and then giving the suggestions for
perfection.
I have fulfilled my eight weeks internship at Habib Bank Limited, The Islamia University
Branch Bahawalpur and tried my level best to achieve something sensibly from this
opportunity.
In my internship I opened many accounts of the customers; most of them were the
employees of The Islamia University. I also did a lot of work on the pension and salary
days. As there is a bunch of crowd on these days so I helped the staff of the bank by
filling out the pension forms and then recording the entries in the register of the Pension
Records. In this way we winded up the work quickly and in less time.
Department of Management Sciences demands every student of BBA/MBA program to
go a procedure of 4 to 6 weeks internship course and to present the report based on the
observations and work done during the training practice. It is actually the appraisal of any
organization currently running its business, having its competitors. It is also meant for
discovering the weaknesses and shortcomings and then giving the suggestions for
perfection.
1
Habib Bank Ltd. Internship Report, 2010
I have fulfilled my eight weeks internship at Habib Bank Limited, The Islamia University
Branch Bahawalpur and tried my level best to achieve something sensibly from this
opportunity.
This internship report starts from the introduction on word ‘BANKING’ and then history of
Habib Bank Limited of Pakistan i.e. how it helped the nation and country in any way.
Bank mission and vision statement shows that it focuses on overall performance of bank
and quality of service and products.
The main objective of the bank is to realize the real importance of its customers and is
profit-oriented.
A bank performs basic functions that are:
Accept money as deposit
Investing deposits to earn profit
Miscellaneous functions
Each branch of the bank is divided into different
sections on the basis of these basic functions.
Deposit Section opens different accounts of
clients and maintains record of money deposits from
2
Habib Bank Ltd. Internship Report, 2010
the customer and credited it into his account. It also maintains record of payment to the
customer when he presents cheque.
Remittance and Collection Section deals with customers who want to transfer or
collect their money from other city.
Clearance Department deals with the clearance of cheques of other banks and also
the cheques can be cleared at any branch of bank.
I have also given the SWOT Analysis of HBL which shows that the bank as many
Strengths and Weaknesses and also with many Opportunities there are numerous
Threats as well.
After this I have suggested and recommended how bank can improve its working and
flourish.
I also faced some challenges and problems before, during and after my internship in the
bank which I have added in the report
In the end I have given conclusion of the entire report.
3
Habib Bank Ltd. Internship Report, 2010
IINTRODUCTIONNTRODUCTION OFOF O ORGANIZATIONRGANIZATION
4
Habib Bank Ltd. Internship Report, 2010
What is Bank?
“Bank is an institution which revives money from one party and lends to
another party.”
There are different views about origin of the word “Bank”. According to some people the
word “Bank” is derived from the world “Bancus” which means a “Bench”. They argue their
point by this transacted their business of money exchange on the benches. If the
business of any businessman failed, his bench was destroyed by the people. Due to this
practice the word “Bankrupt” was also used.
On the other hand some people say that the world “Bank” is derived from German time
the word “Bank” was replaced by the word “Bank” which is called “Banco” in Italian
language.
5
Habib Bank Ltd. Internship Report, 2010
The bank can be defined as a “financial institution that borrows money from one
party and lends to the other party (Government, individual, business) and the
difference between borrowing and lending make profit for the bank.”
In Simple words we can also say that bank is a pipeline through which money moves into
and out of circulation. Bank accepts deposits and repays cash to its customers on
demand. The bank borrows money at a lesser rate of interest and lends it to the borrower
at a higher rate.
The history of banking evolution is very interesting. In the early ages human like and
wealth was not secure. Due to fear of loot-mar and theft people buried their wealth under
land but this method was not satisfied. People started to search the custodians of wealth.
The evolution of banking started and it has crossed the many stages.
Why Bank is important?
Bank plays a significant part in the economic existence of nation. The growth of economy
is strongly related to the reliability of its banking system. Although banks create no new
money but they borrow, exchange and use wealth. In this way they become very valuable
partners in the process of economic development.
6
Habib Bank Ltd. Internship Report, 2010
The fundamental role of bank is to persuade the habit of savings among the people and
to activate these savings for investment purposes. Banks serve in capital formation.
If there are no banks then there would be concentration of capital in few hands and the
great fraction of capital of the country would remain inactive.
Loan facility provided by the bank works as an encouragement to the produce to increase
production. Banks offer transfer of payment facility, which is cheaper, quicker and safe.
These facilities are very much accommodating for the development of commerce and
trade.
Types of Banks
Banks are classified according to their field of activity; the main types of banks are as
under.
Commercial banks
Industrial banks.
Agricultural banks
7
Habib Bank Ltd. Internship Report, 2010
Saving banks.
Exchange banks.
Central banks
Cooperative bank
Commercial Bank
Commercial bank is occupied in performing the routine duties of banking business. Such
bank collects the money from the people (as borrowing) and extends the same money as
a loan for development purposes.
C o m m e r c i a l b a n k s a r e h a v i n g p r o f i t e a r n i n g c o n c e r n s . T h e y r e c e i v e d e p o s i t s a n d a d v a n c e l o a n s t o t h e b o r r o w e r s . T h e y g r e a t l y h e l p i n f i n a n c i n g f o r i n t e r n a l a n d e x t e r n a l t r a d e o f t h e c o u n t r y
So we can say that commercial banks are companies “which transact business of
banking in Pakistan”. Commercial banks have constituted the most important source of
8
Habib Bank Ltd. Internship Report, 2010
institutional credit in the economy of Pakistan. E x a m p l e o f c o m m e r c i a l b a n k s
i n P a k i s t a n i s H B L , U B L e t c .
F u n c t i o n s o f C o m m e r c i a l B a n k s :
T o d a y t h e r e a r e m o r e t h a n 7 0 0 0 b r a n c h e s o f c o m m e r c i a l b a n k s a l o n g w i t h a n e s t a b l i s h e d n e t w o r k o f s u p p l e m e n t a r y f i n a n c i a l i n s t i t u t i o n s .
T h e f u n c t i o n o f a m o d e r n c o m m e r c i a l b a n k c a n b e d i v i d e d u n d e r f o u r h e a d i n g s a s :
A c c e p t a n c e o f d e p o s i t s
A d v a n c e m e n t o f l o a n s
A g e n c y s e r v i c e
G e n e r a l u t i l i t y S e r v i c e
History of banking in Pakistan
At the time of independence, there were 487 offices of scheduled banks in the territories
now constituting Pakistan. Following the announcement of independence plan in June
1947, the Hindus residing in the territories now comprising Pakistan started transferring
their registered offices in Pakistan, transferred them to India in order to bring a collapse of
the new state. By 30th June 1948, the number of offices of scheduled banks in Pakistan
declined from 487 to only 195.
9
Habib Bank Ltd. Internship Report, 2010
BANKING IN PAKISTAN
Pakistan has indeed unique banking
history commencing as were from
scratch at the time of Pakistan of this
subcontinent. However it soon comes
over its extra ordinary banking
problems and by grace of Allah we
have a stable banking sector.
10
Habib Bank Ltd. Internship Report, 2010
H ISTORY OF HABIB BANK L IMITED
11
Habib Bank Ltd. Internship Report, 2010
Habib Bank Limited
Habib Bank Limited commonly referred to as "HBL" and head-quartered in Habib Bank
Plaza, Karachi, Pakistan, is the largest bank in Pakistan. The bank has a network of over
1450 branches in Pakistan and 55 branches worldwide. It has a domestic market share of
over 40%. It continues to dominate the commercial banking sector with a major market
share in inward foreign remittances (55%) and loans to small industries, traders and
farmers.
Mohammed Ali Jinnah, Pakistan's founding father, realized
the importance of financial intermediation while he was
campaigning for the creation of a separate homeland for the
Muslims of India. He persuaded the Habib family to establish
a commercial bank that could serve the Indian Muslim community. His initiative resulted
in the creation of Habib Bank in 1941, with HO in Bombay (now Mumbai), and fixed
capital of 25,000 rupees. The bank played an important role in mobilizing funds from the
Muslim community to finance the All-India Muslim League's campaign for the
establishment of Pakistan. Habib Bank also played an important role in channeling relief
funds to Muslims hurt in the communal riots and violence that preceded the departure of
the British from India.
After Pakistan was born in 1947, Habib Bank, at the urging of Governor-General Jinnah,
moved its headquarters to Karachi, Pakistan's first capital. This gave Karachi its first
commercial bank of the newly formed Pakistan. The Habib family owned and managed
the bank until the Pakistan government nationalized it on 1 January 1974.
12
Habib Bank Ltd. Internship Report, 2010
HBL’s first international branch was established in Colombo, Sri Lanka in 1951 and Habib
Bank Plaza was built in 1972 to commemorate the bank’s 25th Anniversary.
On June 13, 2002 Pakistan’s Privatization Commission announced that the Government
of Pakistan had formally granted the Agha Khan Fund for Economic Development
(AKFED) rights to 51% of the shareholding in HBL, against an investment of PKR 22.409
billion (USD 389 million). On February 26, 204, management control was handed over to
AKFED. The Board of Directors was reconstituted to have four AKFED nominees,
including the Chairman and the President/CEO and three Government of Pakistan
nominees.
It was HBL that introduced products such as Credit Cards, ATMs, Travelers Cheques,
etc., to the Pakistani market. Today, Habib Bank is truly the bank of the people, providing
its customers convenience and satisfaction all over the world. HBL plays a central role in
Pakistan's financial and economic development.
Habib Bank Plaza, the tallest building in Pakistan, is the proud symbol of HBL’s
leadership in Pakistan’s corporate arena.
Habib Bank offers the basic range of banking services to its customers, to include
Commercial, Corporate, Investment, and Retail Banking, Treasury, and Islamic Banking.
It has more than 1489 branches all over Pakistan and presence in 26 countries across
five continents. With a revamped customer oriented philosophy, we are pursuing new
avenues of leadership through innovation, as it gear up to face the challenges of the new
millennium.
13
Habib Bank Ltd. Internship Report, 2010
VISION, MISSION & VALUES
14
Habib Bank Ltd. Internship Report, 2010
Vision of HBLVision of HBL
“Enabling people to progress with a confidence and success.”“Enabling people to progress with a confidence and success.”
15
Habib Bank Ltd. Internship Report, 2010
Mission of HBLMission of HBL
“To be recognized as the leading financial institution of Pakistan and a
vibrant international bank in the promising markets, providing our customers
with a best set of original products and services, and granting superior
values to our stakeholders – shareholders, customers and employees.”
16
Habib Bank Ltd. Internship Report, 2010
Core Values
HBL is absolutely trapped with a business philosophy that incorporate five concrete
values which each individual associated with the bank abides by. Our values are the
fundamental principles that define our culture and are brought to in our life in our attitudes
and behavior. It is our values that make us unique and unmistakable. Our values are
defined below:
1) Excellence
This is at the core of everything we do. The markets in which we operate are becoming
increasingly competitive, giving our customers an abundance of choice. Only through
being the very best - in terms of the service we offer, our products and premises - can we
hope to be successful and grow.
2) Integrity
For us, integrity means a synergic approach towards abiding our core values. United with
the force of shared values and integrity, we form a network of a well-integrated team.
3) Meritocracy
At every level, from selection to advancement, we have designed a consistent system of
human resource practices, based on objective criteria throughout all the layers of the
organization. HBL is therefore, able to achieve a specific level of performance at every
layer of the organization.
17
Habib Bank Ltd. Internship Report, 2010
4) Customer Focus
We understand fully the needs of our customers and adapt our products and services to
meet those. We always strive to put the satisfaction of our customers first.
5) Progressiveness
We believe in the advancement of society through the adoption of enlightened working
practices, innovative new products and processes, and a spirit of enterprise.
Objectives
The bank’s main aim is to provide better and efficient services to its domestic and
efficient customers and overseas customer regarding the need for improving the financial
performance of the company.
Next are some of the main objectives of HBL.
• To get profit for the Bank itself and maximize its shareholder’s value.
• To offer solutions for multiple requirements of clients of assorted financial nature.
• To cope with the changing trends of the modern day financial market.
• To be a diversified bank by offering all basic consumer services along with specialized
services
• Honest and ethical conduct, including ethical handling of actual or apparent conflicts of
interest between personal and professional relationship.
• To provide employment opportunities to people.
• To help in development and industrialization of the country
18
Habib Bank Ltd. Internship Report, 2010
ORGANIZATION STRUCTURE
19
Habib Bank Ltd. Internship Report, 2010
Domestic Structure
With a domestic system of 1408 trade branches and 17 business branches which are well
located in all cities and towns of the country, the bank provides the entire banking
services counting consumer and corporate finances, leasing, investment and money
market transactions etc.
International Structure
Through its 15 overseas offices including branches, locally included subsidiaries and joint
ventures, the bank has international presence in 26 countries encompassing the United
Kingdom, Continental Europe, the Middle East, Southeast and Far East Asia, Africa,
Australia, and the United States. Besides providing banking services to the emigrants
Pakistanis, these offices also help out in developing linkages between Pakistan and the
international financial set-up.
Operational Structure
HBL is among the principal commercial bank of Pakistan. It accounts for a considerable
share (40%) of the entire commercial banking market in Pakistan with a set-up of 1,705
domestic branches; 55 overseas branches in 26 countries extend over Europe, the
Middle East, Far East, Asia, Africa and the United States; 3 HBL wholly owned