Presentation 1 of e Banking

8/3/2019 Presentation 1 of e Banking

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Group members

yALI HARIS

yZUHAIB IJAZ


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NIBy NIB bank is the 7th largest bank in Pakistanbranch wise, NIB bank provides

services to more than 675,000 customers through a wide branch networkof223branches. It is one ofthe fastest growingbanks in Pakistan

y NIB started as NDLC(National Development Leasing Corporation )-IFIC Bankwhich was incorporated in March 2003, as a public limited company

y Started operations in October 2003 with paid up capital ofRs. 1.2bn withamalgamationofNDLC and ofIFICs Pakistanoperations and theirassets &Liabilities, and subsequentlythose ofCredit Agricole Indosuez Pakistan inApril 2004

y Temasek Holdings acquired 25% shareholding in NIB in March 2005 throughBugis Investments which was enhanced toover 70% in June 2005

y NIB bank is the 7th largest bank in Pakistanbranch wise, NIB bank providesservices to more than 675,000 customers through a wide branch networkof223branches. It is one ofthe fastest growingbanks in Pakistan

y NIB started as NDLC(National Development Leasing Corporation )-IFIC Bankwhich was incorporated in March 2003, as a public limited company

y Started operations in October 2003 with paid up capital ofRs. 1.2bn withamalgamationofNDLC and ofIFICs Pakistanoperations and theirassets &Liabilities, and subsequentlythose ofCredit Agricole Indosuez Pakistan inApril 2004

y Temasek Holdings acquired 25% shareholding in NIB in March 2005 throughBugis Investments which was enhanced toover 70% in June 2005


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y NIB has grownrapidlyfrom 2 branches in 2003 toaround 240 postmerger in the first quarterof2008, with acorresponding increase in itsdeposits and assets base

y NIBvision is torankamongst top 5 banks in Pakistan. Therefore itacquired majorityshares ofPICIC on June 28 2007, which gave controlofits subsidiaries (acommercial bank PCBL, anasset managementcompany- PICIC AMC and PICIC Insurance). NIB also has ashareholding in NAFA, anasset management company, along withNational BankofPakistanand Fullerton Asset Management Company

y Legal mergerofPICIC & PCBL into NIB took place on 31st December07, once all regulatoryapprovals were obtained. Numberofbranchesthen increased from 45 to 240


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y Post merger NIB total assets increased to Rs. 176.6 bn as of31stDecember 2007, further increasing to Rs 180 bn as of31st September08. Present paid up capital ofRs. 40.4 bn is highest amongst banks inPakistano NIB is now the 7th largest bank in Pakistan in terms of

branch network. Temasek Holdingremains the largest singleshareholder with approximately74% shareholding

y NIB has almost 4900 employees.NIB business units include:

y Small Medium Enterprises and Commercial Banking Group

y Corporate and Investment Banking Group / Financial Institutionsy Consumerand Small Enterprise Groupy Treasury


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Quality for NIB banky NIB Bank is an exemplary provider to business and

industry offering high quality expertise and servicealong with innovative Banking solutions, which inturns supports economic development.

y At NIB Bank, wevalue our Human Capital and ensure thatemployees in everyfunctional areaofthe bank have therequired skills & competencies to deliver the business

proposition toourcustomers.y NIB provides a work environment which is inclusive and

supportive, where staffis highlyvalued and feel motivated,based onfairness, equityand business needs.


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External ApproachIfwe talkabout the external approach NIB bank isfocused on,

y External CustomersyValued product and services

y Customerretention

y Increased customerbase

y Profitabilityand growth


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Internal Approach

y Talkingabout the internal approach adopted bythebank NIB is focused on,

y Bank its people and processesy Efficiencyand effectiveness inall aspects

y Profitabilityand growth


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Electronic Banking in NIB

y Electronicbanking, alsoknownas electronicfund transfer

(EFT), uses computerand electronic technologyas asubstitute forchecks and other paper transactions. EFTsare initiated through devices like cards orcodes that letyou, or thoseyouauthorize, accessyouraccount.


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ALTERNATE DELIVERY CHANNEL:

y Automated Teller Machines or 24-hour Tellers are electronic terminals thatletyoubankalmost anytime. To withdraw cash, make deposits, or transferfunds betweenaccounts,yougenerallyinsert an ATM card and enteryour PIN.


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y Pay-by-Phone Systems letyoucallyourfinancial institution withinstructions to paycertainbills or to transferfunds betweenaccounts.You must have anagreement with the institution to make such

transfers.


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y Personal Computer Banking letsyou handle manybankingtransactionsviayour personal computer. For instance,you mayuse

yourcomputer toviewyouraccount balance, request transfers between

accounts, and paybills electronically.


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y Debit Card Purchase Transactions letyou make purchases with adebit card, which also maybeyour ATM card. This could occurata store orbusiness, on the Internet oronline, orbyphone. While

the process is fast and easy, a debit card purchase transfersmoney fairlyquickly fromyourbankaccount to thecompanys account. So its important thatyou have funds inyouraccount tocoveryour purchase.

y Direct Deposit letsyouauthorize specific deposits, such as

paychecks and Social Securitychecks, toyouraccount onaregularbasis. Youalso maypre-authorize direct withdrawals sothat recurringbills, such as insurance premiums, mortgages, andutilitybills, are paid automatically.


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Why e banking?y E-Banking services are aligned well with the banks

goal to enhance its business relationship with clients

and maintainfinancial stabilitythrough operationalefficiencyand cost effectiveness.

y It wants togive its clients options for self-servicechannels because these are cost-efficient to the bank.

Cost-efficiency, in turn, allows the bank tooffer theirclients the best products and services


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BENEFITS OF INTERNET BANKING

TO BANKy Cost Savings

y Electronic processing dramaticallyreduces the cost per transaction. Theaverage transactioncost at afull service bank is more as compared totransactionat an ATM and transactionat web is much less. electronicbill

presentment costs 40% less than paper delivery.

Loyal Customers

y NIB bank is moving tooffera huboffinancial services includingbillpresentment and payment, financial planning, estate planning, insurance,loans, and brokerage services. . The idea is that bycreatinga more loyalcustomer who depends onabankfor manyfinancial services


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Internet Profit Generationy E-commerce, when properlyintegrated into existing

bankingoperations, can lead to substantial cost savings

and higher profitability. banks are able toretaincustomersmore effectivelywhenoffering services that arevalue-added.High-Profit Customers

y Bankgenerate 50% more revenue than the average

customer; hold 20% higherbalances;use 50% moreproducts, and theirattritionrate is 50% ofthe overallattritionrate. Furthermore, onaverage, it costs 14% less toservice these customers as compared tobricks-and-mortarcustomers.


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CRITICAL SUCCESS FACTORy WEBSITE DEVELOPMENT:

Tocreate a positive experience, agreat deal ofplanning, resources and expertiseinvested in the development and ongoing maintenance ofwebsites byNIB. NIBwebsite manage all the aspects that customers would expect from the buying

process inanon-web environment.


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Channel Integration

y Services distributionchannels for NIB has evolved overa long time driven primarilybyneed, changes inregulations, market environment and technological advances. banksneed to invest inaconsistent and seamless customer experience across all channels,which requires integrationofreal-time cross-channel communications. Usage ofthe

major deliverychannels is split and changes with time.


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Managing Relationships with

Customers:y Managers responsible for managingrelationships with

customers. Some people need extracounselingbefore

buyinganonline product due to their inabilitytounderstand complexfinancial products or technology.This should be available byin the form ofcustomerservices over the phone.


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Winning Customer Trust

y One ofthe biggest obstacle in the growth ofe-commerce is the lackoftrust manypeople feel when

theyconduct transactions online. Developingatrustworthyonline brand is a strategicas well as amanagerial challenge.


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Human Resources Management

y Humanresources management is akeyfactorofin the

success in e-banking. Ebanking HRrequires special skillsbecause HRfunctions such as (HR) planning,jobanalysisandjob design, recruitment and selection,job progression,appraisal process, training, and compensation would bedifferent thanforother traditional business areas.

Project Management:y A project mayinvolve anumberofsteps such as feasibility

study, determinationofobjectives, planning, executionaswell as end ofproject evaluation.


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Core Banking Application Of NIB:y for IBM servers supportinga T24 implementation has gone

through at NIB Bank. Branch rollout for more than 244branches ofNIB Bankall over Pakistan. Rollout was

conducted forretail bankingat branch level, trade financeat hub level and credit operations at head office level.y TEMENOS T24 is the most technicallyadvanced banking

system available today.y T24 is built onopenarchitecture, offers low cost of

ownership and uses established standards such as HTTP,XML and J2EE.

y The designofT24 offers multiple application serversupport offering horizontal scalabilityand supporting hugenumbers ofusers with true non-stop resilience.


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Functionality

y T24 provides a solid foundationforbanks to managecustomers, processes, risks and monitorongoingactivities,as well as specialised line ofbusiness functionality, which

provides the full range ofbanking services.y Retail Bankingy CRMy Multi-channely Cash transactionsy Paymentsy Credity Depositsy Loan simulation


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y Private Wealth Management

y Portfolio Management

y

Valuationsy Compliance

y Relationship Management

y Order Management

y Products & Instrumentsy Backoffice Support

y Operational Service


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y Corporate Banking

y Paymentsy Cash managementy

Commercial Lendingand Syndicated Lendingy Trade financey Internet banking

y TreasuryOperations

y Forexy

Moneymarkety Securities and reposy FRAs and swapsy Nostro recs and confirmation matchingy Futures and options


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SWOT ANALYSISy In its qualityassurance cell, the bank maintains acheckand balance on

methods ofsales distribution, new business ideas and strategicoptions, such asenteringanew market or launchinganew product in its product line, changingits suppliers and outsourcing its services.

y STRENGTHSy Promoting savings and investment Byprovidingcheaper loans and giving high

interest on savingaccounts.y Theyhave computerized system, and online banking.y Automated systems made NIB bank torise with the pressure ofrising

competition.y The employers at NIB are offered reasonable monetarybenefits. Normallytwo

bonuses are given Eid ul Fitarand Eid ul Azha.y NIB bank has well established website and is up to date about the bank.y The openingofseveral new flagship branches along with arefurbishment

programme canbe seenas anattempt torefocus oncustomer demands forastrong presence


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y WEAKNESSy Centralized organizational structure.y Branch area isverysmall with respect to hired staff.y Though NIB Bank installed computeryet the system has not totally

shifted oncomputer. Manual procedure is still there hence computerfacilityis not fullyavailed. It should be fullyavailed and system shouldbe fullycomputerized.

y A lot ofproductive time is wasted bythe staffinunproductive pursuitsand teaand lunch breaks are gotvoluntarilyextended and the timespent incorridors, courtyards, depends on the staffwill. This tendency

oflate must be eliminated which reflect adverselyon the image oftheinstitutionand has posed a serious problem.y People have to wait forre-cashing theircheques forabout 10 to 12

minutes, which is not good for the reputationofbank.


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y OPPURTUNITIESy Large market potential.y Favorable demographicchanges in society.y Increase credit facilities to lower level income and also to SME,s.y The banks strategyis toofferafull portfolioofservices nationwide,

providinga wide range ofcross-sellingopportunities.y Since the Bank has an extensive networks ofbranches so ifthe bank

canbe able tocomputerize all ofits branches then it canbe able tocapture the market more efficiently

y The bank has alreadya huge amount ofcustomers byprovidingbetterand better services to their existingcustomers, but word ofmouth canalsobe helpful in increasing the numberofcustomers to have acompetitive advantage over its growingnumberofcompetitors.


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y THREATSy Huge competition with local and foreignbanksy Rapid technological advancements has become challenge for

NIB Bank Ltdy Due to increasingnumberofforeignbanks in Pakistan which

offeraveryattractive package for their employees theverykeyemployees ofthe bankare more likelytoresign which is averymajor threat.

y Not all branches are computerized neither providing ATM

services and noonline bankingand the customers demand forthese services is increasing daybydayso Bank shouldcomputerize all its branches.

y At some places, the NIB Bank Limited is over-employed. whichis causingover expenditure


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Conclusion

y In everyindustry, E-commerce is revolutionizing thewaybusiness is conducted. New business models are

replacingoutdated ones and organizations arerethinkingbusiness process designs and customerrelationship management strategies. NIB Bankinherits strongorganizational culture havingvalues forleaders and as well as for employees and customersand the organizationbehavior is up to the markforanycompanybeing in Pakistan.


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Recommendationsy NIB Bank should offer trainingand development sessions forundergraduates;

this will help NIB Bank infuture while recruiting employees.

y NIB should introduce Dress-Down dayi.e. employees should be given

permission to wear dresses other thanformal dresses oncertain days soas tomake them relaxed while work.

y Customerretention: Customerretention is one ofthe main priorities forbankstoday. With the entryofnew players and multiple channels, customers havebecome more discerningand less 'loyal' tobanks.

y Inorder to implement total qualitymanagement, bankneed torespect a

cultural change in direction, set the strategyand give employees achance tolookat things differently.

y Reorganizing products and services according tocustomerrequirements


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Presentation 1 of e Banking

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