EXECUTIVE SUMMARY

According to our internship program, I completed my six weeks internship at Soneri Bank Limited, Thokar Niaz Baig LHR Branch. Soneri Bank Limited is playing an important role in the financial and economic development of Pakistan. The banking structure in Pakistan comprises of the following types, State Bank of Pakistan, Commercial Bank of Pakistan; Exchange Banks, Saving banks, Cooperative banks, specialized credit institutions. The state bank of Pakistan is the Central bank of the country and was established on July 01, 1948. The network of bank branches now covers a very large segment of national economy. The State Bank of Pakistan issues the shares of these periodically. Bank employees and other common peoples can also purchase these shares and earn profit. I have given the working of each and every department in which I worked and learned during my internship.

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ACKNOWLEDGEMENT
In the name of ALLAH, the most Beneficial and the most Merciful, HE is the one who gave me courage and made me the super creature with great knowledge and able me to accomplish this work. Success is hard to achieve and I thanks to Allah Almighty for giving me valor to finish this internship report successfully. The internship has given me an opportunity to learn a lot about practical life and this will be memorable for me in the whole future academic and professional life. I hope that this experience will h elp me throughout my life. I pay special gratitude to my internship teacher sir Saleem Anjum who led me through this task whenever I needed his guidance. Hope for his guidance for the future projects as well. I express my fondest affection for my parents who prayed for my success and encouraged me. I appreciate and acknowledge the patience, understanding and love provided by them. It is of course the reward of their good wishes and kind blessings. The acknowledgement will remain incomplete without special thanks to my co-interns for their excellent cooperation and nice companionship during the internship. I am indebted to all the staff of Soneri Bank Limited, Thokar Niaz Baig Branch LHR who appreciated all my work, supervised me, provided their assistance to me when I needed and inculcated their knowledge in me. Without their cooperation, I would never have been able to complete this Internship contentedly and with pleasure.

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INTRODUCTION
A bank is a financial institution which deals with money and credit. It accepts deposits from individuals, firms, and companies at a lower rate of interest and gives at a higher rate of interest to those who apply for loan. The difference between the terms at which it borrows and those at which it lends from the source of its profit, it is also called the spread. A bank, thus, is a profit earning institute. Any bank that performs this functioning is called the commercial bank.

A bank is a firm which collects money from those who have it spare. It lends money to those who require it.

Soneri Bank Limited was formally incorporated on September 28, 1991. The first Branch commenced operations in Lahore on April 16, 1992, followed by the launch of Karachi's first Branch on May 09, 1992. The bank currently operates 186 branches, spread all over Pakistan including the Northern Areas of the country. The banks expansion policy is based on the principle of maintaining a balance between the urban and rural areas. Soneri Bank Limited is one of the fastest growing financial institutions of Pakistan. Bank continues to build a track in its quest for excellence. Soneri Bank Limited continually endeavors to develop a wider spectrum of innovative financial products based on consumer needs. The aim is to ensure customer satisfaction by providing high quality banking products and services. This is made possible by the professionalism of employees, all of whom are provided with the requisite training and opportunities to enable them to realize their full potential.

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Contents
EXECUTIVE SUMMARY ............................................................................................................................1 ACKNOWLEDGEMENT .2 INTRODUCTION ..........................................................................................................................................3 TABLE OF CONTENT .4 PROFILE OF THE BANKING INDUSTRY .................................................................................................6 PROFILE OF THE COMPANY ....................................................................................................................7 THE MANAGEMENT: ..............................................................................................................................8 VISION STATEMENT OF THE COMPANY ............................................................................................10 MISSION STATEMENT OF THE COMPANY..........................................................................................10 POLICIES OF SONERI BANK LIMITED: .............................................................................................11 CORE VALUES OF SONERI BANK LIMITED: ...................................................................................12 COMPETITIVE STRATEGY OF SNBL: ................................................................................................13 HIERARCHY MANAGEMENT OF THE COMPANY ..........................................................................15 HUMAN RESOURCE POLICIES OF THE COMPANY .......................................................................16 MARKETING STRATEGIES OF THE COMPANY ..............................................................................17 INFORMATION TECHNOLOGY ..........................................................................................................18 INDUSTRY BUSINESS PROCESS ............................................................................................................21 BANKING BUSINESS PROCESS ..........................................................................................................21 BUILDING A BETTER BANKING BUSINESS PROCESS ..................................................................21 BUILD INTELLIGENCE AND AGILITY INTO PROCESS WITH PEGA BPM .................................21 COMPANY BUSINESS PROCESS ............................................................................................................24 COMPANY DEPARTMENTAL FUNCTIONS ..........................................................................................24 GENERAL BANKING ............................................................................................................................24 CLEARING ..............................................................................................................................................25 REMITTANCE .......................................................................................................................................27 DEMAND DRAFT ...............................................................................................................................27 PAY ORDER ........................................................................................................................................29 MAIL TRANSFER ...............................................................................................................................30 RECEIPTS AND PAYMENTS ....................................................................................................................32 7. STOP PAYMENT .................................................................................................................................33

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ACCOUNT OPENING DEPARTMENT .................................................................................................33 ACCOUNT OPENING...............................................................................................................................34 Salaried Individuals ................................................................................................................................36 Self-Employed/Business men ...............................................................................................................36 Sole proprietorship .................................................................................................................................36 Minor Account ..........................................................................................................................................36 Limited Company ...................................................................................................................................36 Clubs/Societies/Associations ................................................................................................................37 Trusts ........................................................................................................................................................37 LETTER OF THANKS ............................................................................................................................39 SCRUTINY OF CHEQUES .........................................................................................................................39 POSTING OF CHEQUES/OTHER INSTRUMENTS AND FIXATION OF STAMP AS PER NATURE OF PAYMENT .........................................................................................................................................40 CUSTOMER SERVICE: ........................................................................................................................41 TYPES OF ACCOUNTS ..........................................................................................................................42 FOREIGN TRADE ...................................................................................................................................48 EXPORT REFINANCE SCHEME ..........................................................................................................56 CREDITS AND CREDIT ADMINISTRATION DEPARTMENT .............................................................60 Features of credit department ...............................................................................................................61 STEPS INVOLVED IN PREPARATION OF CREDIT LINE PROPOSAL ...........................................63 FOREIGN CURRENCY ACCOUNTS DEPARTMENT ........................................................................65 FOREIGN REMITTANCES..............................................................................................................65 SWOT ANALYSIS OF BANKING INDUSTRY ........................................................................................68 STRENGTHS: ..........................................................................................................................................68 WEAKNESSES: .......................................................................................................................................68 OPPORTUNITIES:...................................................................................................................................69 THREATS: ...............................................................................................................................................70 SWOT ANALYSIS OF COMPANY ...........................................................................................................70 IDENTIFICATION OF PLAUSIBLE PROBLEMS ....................................................................................75 RECOMMENDATIONS FOR THE COMPANY .......................................................................................76 CONCLUSION .............................................................................................................................................78

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APPENDICES ..............................................................................................................................................80

PROFILE OF THE BANKING INDUSTRY

In the banking industry, office and administrative support workers constitute 2 out of 3 jobs; tellers account for about 3 out of 10 jobs. Many job opportunities are expected for tellers and other office and administrative support workers, because these occupations are large and have high turnover. Many management positions are filled by promoting experienced, technically skilled professional personnel. Banks safeguard money and valuables and provide loans, credit, and payment services, such as checking accounts, money orders, and cashiers checks. Banks also may offer investment and insurance products, which they were once prohibited from selling. Banks also may offer investment and insurance products, which they were once prohibited from selling. As a variety of models for cooperation and integration among finance industries have emerged, some of the traditional distinctions between banks, insurance companies, and securities firms have diminished. In spite of these changes, banks continue to maintain and perform their primary roleaccepting deposits and lending funds from these deposits. Banking is comprised of two parts: Monetary AuthoritiesCentral Bank, and Credit Intermediation and Related Activities. The former includes the bank establishments of the U.S. Federal Reserve System that manage the Nations money supply and international reserves, hold reserve deposits of other domestic banks and the central banks of other countries, and issue the currency we use. The establishments in the credit intermediation and related services industry provide banking services to the general public. They securely save the money of depositors, provide checking services, and lend the funds raised from depositors to consumers and businesses for mortgages, investment loans, and lines of credit. There are several types of banks, which differ in the number of services they provide and the clientele they serve. Although some of the differences between these types of banks have lessened as they have begun to expand the range of products and services they offer, there are still key distinguishing traits. Commercial banks, which dominate this industry, offer a full range of services for individuals, businesses, and governments. These banks come in a wide range of sizes, Internship Report Page 6

from large global banks to regional and community banks. Global banks are involved in international lending and foreign currency trading, in addition to the more typical banking services. Regional banks have numerous branches and automated teller machine (ATM) locations throughout a multi-state area that provide banking services to individuals. Banks have become more oriented toward marketing and sales. As a result, employees need to know about all types of products and services offered by banks. Community banks are based locally and offer more personal attention, which many individuals and small businesses prefer. In recent years, online

Bankswhich provide all services entirely over the Internethave entered the market, with some success. However, many traditional banks have also expanded to offer online banking, and some formerly Internet-only banks are opting to open branches. Savings banks and savings and loan associations, sometimes called thrift institutions, are the second largest group of depository institutions. They were first established as community-based institutions to finance mortgages for people to buy homes and still cater mostly to the savings and lending needs of individuals. Credit unions are another kind of depository institution. Most credit unions are formed by people with a common bond, such as those who work for the same company or belong to the same labor union or church. Members pool their savings and, when they need money, they may borrow from the credit union, often at a lower interest rate than that demanded by other financial institutions.

PROFILE OF THE COMPANY

Soneri Bank Limited (the Bank) is engaged in banking services. The Bank operates in four segments. Corporate banking includes syndicated financing and services provided in connection with mergers and acquisition, underwriting, privatization, securitization, research, debts, equity, syndication, initial public offering (IPO) and secondary private placements. Trading and sales includes fixed income, equity, foreign exchanges, commodities, credit, funding, own position securities, lending and repos, brokerage debt and prime brokerage. Retail banking includes retail lending and deposits, banking services, trust and estates, private lending and deposits, banking service, trust and estates investment advice, merchant / commercial / corporate cards and private labels and retail. Commercial banking includes project finance, real estate, export finance, trade finance, factoring, leasing, lending, guarantees, bills of exchange and deposits. As of December 31, 2010, it operated 184 branches. Internship Report Page 7

THE SPONSERS:
The Sponsor Directors are from M/s. Rupali Polyester Limited who enjoy excellent reputation in the country both professionally and financially and who have invested over Rs.10 billion i.e. U.S.$. 200 million approximately in various industrial & commercial projects of the country.

THE
Financial Highlights (Rs. in Millions) . Share-Holders Equity Deposits Financing to Customers Investments Total Assets Pre-Tax Profit Import & Export Business Break-up Value of Share (Face Value Rs.10/= each No. of Accounts 95,687 75,115 1999 1,103 12,262 7,797 7,116 17,730 382 31,574 22.01 1998 970 11,040 6,631 6,142 14,860 335 24,112 Rs.19.36

Pay out to share-holders has been 1993 1994 1995 1996 1997 1998 1999 10 Percent Right Shares 15 Percent Bonus Shares 15 Percent Cash Dividend 17.5 Percent Cash Dividend 20 Percent Bonus Shares 10 Percent Interim Bonus Shares 10 Percent Final Cash Dividend 25 Percent Bonus Shares

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THE MANAGEMENT: The President & Chief Executive of the Bank Mr. Safar Ali K Lakhani, a carrier banker with experience spread over a period of more than 35 years, has had extensive exposures to domestic and international banking both at home and abroad. He has a team of professional and experienced bankers to assist him. SERVICES: Soneri Bank offers a full range of Corporate, Treasury, and Retail Banking Services with emphasis on Trade-related services to importers and exporters. The essence of business philosophy is to cater to the banking requirements of small & medium sized entrepreneurs, providing them qualitative & competitive services. Emphasis is on encouraging exports and major portion of the advances portfolio of the bank is related to export financing Mindful of the requirements of automation the bank has started Soneri Tele-Banking Service & in the first phase installed two ATMs at important locations in Karachi while the work for connecting the branches on line for customers convenience is being actively pursued. INTERNATIONAL RELATIONS: The extensive correspondent network in just eight years of operations and the excellent relations maintained have proved valuable in bank's efforts in conducting international banking business. The bank was able to handle trade finance business of over Rs. 31 billion in 1999. (approx. U.S.$. 600 million) HUMAN RESOURCE DEVELOPMENT AND TRAINNING PROGRAM: Great emphasis is laid on the development of human resources. The bank regularly sends officers and executives to attend Banking Seminars both inside the country and abroad. Foundation courses for the new entrants in banking are a continuing feature in our academy. Because the soneri bank provides its employees chances of further training according to its plans and policies after selection and recruitment.

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VISION STATEMENT OF THE COMPANY

To provide visionary services and dynamic banking solutions to cater the needs of all our stakeholders.

MISSION STATEMENT OF THE COMPANY

To develop Soneri bank into an aggressive and dynamic financial institution having the capabilities to provide personalized services to customers with cutting edge technology and a wide range of products, and during the process to ensure maximum return on assets with ultimate goal of serving the economy and society

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OBJECTIVES OF SONERI BANK LIMITED: SNBL as being privately owned, the primary objective is maximum net profit, growth of business and to capture maximum potential market. The operating results of SNBL shows an impressive improvement compared to the last financial year and the improving return on assets indicate the increasing operational and administrative efficiency, just because SNBL is continually achieving its objectives. These objectives are: To get maximum net profit by keeping and maintaining different kinds of institutional and individual account. Optimize utilizations of assets. To meet customer satisfaction and get maximum potential from the Market. To develop a wider spectrum of innovative financial products based on the consumer needs. Provide convenience to its clients. Products must get considerable success in the market. Well-integrated branch network that offers greater potential for servicing a larger client based through high value products. Consumer durable financing. Long term planning.

POLICIES OF SONERI BANK LIMITED: SNBL since its establishment has been providing excellent services all because of the strengthened policies and strategies set out by its Broad and Management, these policies cover all grounds of good banking, following is the road map to their success: Customer satisfaction will always remain the number one benchmark; the aim is to maximize value for clients by offering high quality financial solutions that best meet their current needs and long-term goals. Bank is continuously looking for expansion in terms of deposits so highly dedicated Business development Officers (B.D.Os) is being hired. To maintain sufficient resources over a long period of time and utilize them in productive way. This can be done through Liquidity Management and Credit Risk Management. Page 11

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To promote strong and ethical business practices in the industry by focusing more on effective collaboration with stakeholders. The corporate policy focuses on striking the optimum balance in organizational workflows and processes. The policies include; employ and retain an unparalleled workforce of highly motivated, energetic, well-trained and productive employees, and offer them an inspiring work environment, competitive salaries, excellent benefits and caring leadership. SNBL is committed to the personal welfare and professional development of all team members and sharing expertise and operational excellence across the groups. The Bank is fully aware that branch network has direct impact on the business so; an intensive branch network will be established all around the Country.

CORE VALUES OF SONERI BANK LIMITED:

SNBL is firmly grounded with a corporate philosophy that incorporates five solid values, which each individual associated with the bank. These values and business principles provide the framework within which they carry out their operations, abides by:

HUMALITY:
Bank encourages a culture of mutual respect and treats team members and customers both with humility and care.

INTEGRITY:
Integrity means a synergic approach towards abiding the core values. United with the force of shared values and integrity, SNBL forms a network of a well-integrated team.

MERITOCRACY: At every level, from selection to advancement, Soneri has designed a consistent system of human resource practices, based on objective criteria throughout all the layers of the organization. Bank is, therefore, able to achieve a specific level of performance at every layer of the organization.

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 TEAM WORK:
SNBL team strives to become a cohesive and unified force, to offer you, the customer, and a level of service beyond ones expectations. This force is derived from participative and collective endeavors, a common set of goals and a spirit to share the glory and the strength to face failures together. The entire department heads work with their subordinates as team members they provide them help and guide them to achieve their goals.

CULTURE OF INNOVATION:
The Bank aims to be proactively responsive to new ideas, and to respect and reward the agents, leaders and creators of change.

COMPETITIVE STRATEGY OF SNBL:

The strategy used by the management to position SNBL in such a way that it will have distinctive advantage over its competitors.

COST LEADERSHIP:

SNBL adopted the strategy to be the cheapest services provider (the cheapest rates for the services of Remittance, foreign trade etc), and the lowest interest rates for their products. DIFFERENTIATION:

The strategy an organization follows when it wants to be unique among its competitors with unique products and value added services. TARGET MARKET:

The target market, of SNBL, is not only the conventional consumers but the corporate sector as well.

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UNIQUE PRODUCTS AND SERVICES:

SNBL plans to introduce innovative and flexible financial products and services.

LOWEST RATES:

The rates will be surely charged less than the competing products of other banks.

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HIERARCHY MANAGEMENT OF THE COMPANY

President

Board of Director

Member Executive Board

Regional Chief

Zonal Chief

Branch Manager

Officer Grade I

Officer Grade II

Cashier

Clerks

Peon

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HUMAN RESOURCE POLICIES OF THE COMPANY

People oriented Deployment, Promotion and selection policies: Bank has formulated and put in place well documented and comprehensive deployment, promotion and selection policies oriented towards identifying the best talent and providing opportunities for fast-track growth and development. Some of the prominent HR policies put in place are HR Resourcing policy Promotion policy for officers Transfer policy for officers Promotion policies for clerical and subordinate cadre Overseas selection policy Talent identification & Grooming programs

Various programs are being run by the Bank for grooming of officers in specialized areas of Credit, Forex, Treasury / Dealing, Wealth Management, for grooming of Branch heads, etc. HRNes (Human Resource Network for Employee Services) "HRNes" covers the entire gamut of human resources management function in the Bank currently being performed and also includes many new sub-functions. It comprises of four broad modules encompassing different functions.

Grooming and etiquettes programs: Grooming and etiquettes programs are being conducted for front-line employees and also for employees selected for overseas posting in order to improve their service levels and qualitative interaction with customers and various stakeholders better. SEED (Self efficiency and effectiveness development) programmed being run for frontline staff of the Bank in order to improve their service skills and servicing efficiency. Internship Report Page 16

MARKETING STRATEGIES OF THE COMPANY

Bank is amongst first in the industry to complete an all-inclusive rebranding exercise wherein various novel customer centric initiatives were undertaken along with the change of logo. The initiatives include setting up of specialized Branches and Retail Loan Factories/ SME Loan Factories with an assembly line approach of processing loans for speedy disbursal of loans. The major ongoing initiatives of the Bank are detailed below: Business Process Reengineering (BPR): Bank had initiated a major Business Process Reengineering to give a big boost to sales growth by enhancing customer satisfaction and by making possible alternate channel migration thus reinventing itself to challenges of the 21st century. People Initiatives: Bank is endowed with a competent and motivated employee base which is engaged in handling the extensive business operations of the Bank across the globe. Strategic HR interventions like, according cross border and cross cultural work exposure to its managers, hiring diverse functional specialists to support line functionaries and complementing the technical competencies of its people by imparting conceptual, managerial and leadership skills, gave the Bank competitive advantage. People initiatives were blended with IR initiatives to create an effectively harmonious workplace, where everyone prospered. New Technology Platform: Bank has made substantial progress in its end-to-end business and IT strategy project covering the Banks domestic, overseas and subsidiary operations. All Branches, Extension Counters in Pakistan, overseas business and five sponsored Regional Rural Banks are on the Core Banking Solution (CBS) platform. Bank has been providing to its customers Internet Banking, viz., Online and other facilities such as online payment of direct and indirect taxes and certain State Government taxes, utility bills, rail tickets, online shopping, donation to temples and institutional fee payment. Bank has a wide network of ATMs across the country and has also launched mobile ATMs in select cities. Initiatives have been taken to provide corporate customers with facilities like direct salary upload, trade finance and State Tax payments etc. Bank has introduced Mobile banking. Internship Report Page 17

Marketing Initiatives: Ever since its reinforced by alternate delivery channels such as internet banking, ATMs, mobile banking etc. and robust delivery outfits like Retail Loan Factories, SME Loan Factories, and City Sales Office etc. Banks constant endeavor to strengthen its branch/ATM network combined with well-informed staff offering personalized service at its various touch points have enhanced customer interactions and satisfaction. Thus the Bank has firmly positioned itself as a technologically advanced customer-centric bank. The Future: Revolutionary and discontinuous changes in the operating environment are stark reminders that business success is 'impermanent'. Bank has achieved substantial progress in technology and is continuously integrating multiple platforms of technology to generate synergies. Bank continuously attempts to adapt to the dynamic economic environment while engaging in long term relationships to provide superior customer service. Banks constant endeavor to delight its customers, which is built on its strong fundamentals will make it stronger, more resilient and enable to achieve its vision of to be the Most Admired Bank.

INFORMATION TECHNOLOGY The importance of information technology can hardly be denied in modern businesses, because in the last two centuries IT has had dramatic impacts in almost every aspect of an organization. It is argued that IT is much more different and pervasive than the earlier technologies, particularly in terms of reducing cost of power and processing capabilities and in making an organization a successful unit in a true sense. Information technology is revolutionizing not only the internal environment of an organization, but also having long lasting impacts on the external environment of an organization. In this modern era more and more organization are diverting towards GLOBALIZATION, and the only thing that could give them stand in this change and challenging environment is the recognition of fact, that they have to keep abreast with all these changing technologies. Recognizing the Internship Report Page 18

dynamic nature of information technology SNBL is restructuring its banking infrastructure through I.T to achieve dramatic improvements in terms of:

Increased efficiency & effectiveness Reduced need for people to perform repetitive work Higher level jobs requiring training and development

To keep abreast with changing technologies the bank is relying heavily on the extensive usage of computing resources and technologies. The networking system is one of these facilities that is connecting not only the internal structure of a bank, but also linking different branches nationally as well as internationally. In specific terms, the bank is using network environment for these reasons: Hardware Sharing Data and Information Sharing Software Sharing Facilitated Communications

DEFICIENCIES IN INFORMATION TECHNOLOGY: No doubt, banks Information system is meeting almost all the requirements of the bank, but it is suffering from some serious deficiencies that can cause great havoc to the sensitive business of banking. These problems are: Performance of control functions by non-qualified operators. Control functions are not being separated and rotated on regular basis where the situation warrants so. Network control software is not restricting the operator access from performing certain unauthorized tasks. Network control software is not maintaining the Audit Trail of operators activities. Network standards and protocols are not documented and made available to the operator. Network access by the security engineers is not closely monitored and reviewed to detect any unauthorized access. Page 19

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Data encryption no doubt used by the bank but not up to that extent where it should be.

RISK OF THESE DEFICIENCIES: Loss of data and program integrity through unauthorized changes. Lack of current data protection through inability to maintain version control. Virus infection. Violation of software licenses because of unlicensed and excessive numbers of software copies. Impersonation or masquerading Internal users sniffing and spooning. Destruction of logging and auditing data.

Now in the next section, I am going to give insight to different cells of SNBL ThokarNiazBaig Branch, Lahore in which I have stayed during my internship.

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INDUSTRY BUSINESS PROCESS

BANKING BUSINESS PROCESS Banks are highly focused on business process improvement. Existing processes and services need to be documented with a focus on identifying commonalities, redundancies and interdependencies. The inefficiencies need to be moved, which will drive out cost and improve agility. Process then need to be modeled and simulated. Doing this will provide the foundation for business and IT transformation. Leading banks use business analytics to predict and prevent credit frauds, saving millions. Retailers use business analytics to predict the best location for store and how to stock them. Pharmaceutical firms use it to get life- saving drugs to market more quickly. Even sports teams are getting in on the action, using business analytics to determine both game strategy and optimal ticket prices.

BUILDING A BETTER BANKING BUSINESS PROCESS Todays retail and wholesale banks face unprecedented operational pressures that test the efficiency, effectiveness, and agility of their business processes. The typical banking business process often fails the test, struggling to adapt to shifting marketplace demands and regulatory requirements. Lending institutions of all stripes are looking to build a better banking business process, intelligent enough to successfully balance business objectives with customers desires, and agile enough to keep pace with a dynamic operational environment.

BUILD INTELLIGENCE AND AGILITY INTO PROCESS WITH PEGA BPM For more than 25 years, major financial institutions have relied on Pegasystems to help them adapt to a changing marketplace. The recognized leader in business process management, Pega systems delivers financial services solutions that enable domestic and global banks to reach new levels of customer satisfaction, operational excellence, and business agility. Pega BPM is distinguished by powerful and flexible business rules capabilities that support the creation of highly intelligent business processes; and by revolutionary automated programming technology

that enables business users to drive banking business process change with minimal involvement from over-stretched IT staff. With Pega financial services software, you can build a better banking business process in key areas such as:

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New business acquisition and on-boarding By putting the power of banking business process creation and modification in the hands of business users, Pega BPM enables you to rapidly roll out promotions or enter new markets. Pega BPM also helps you to evaluate and optimize campaigns, and to develop more effective and efficient on-boarding processes.

Intelligent automation With Pega BPM, you can quickly and easily automate banking business processes and tasks to eliminate manual handling and reduce costs and errors.

Customer relationship management Pega BPM helps you to deliver superior customer service levels while maximizing per-customer profitability. For example, with a combination of point-of-interaction process automation and decision-making support for agents, Pega banking contact center solutions dramatically increase first-contact resolution rates.

Risk, fraud, and compliance Pega banking business process solutions can help your institution gain the agility you need to successfully comply with regulations, mitigate risk, and stop fraud. Process automation ensures consist compliance with regulations and corporate policy, while advanced analytics help detect early signs of fraud or excessive portfolio risk. Pega BPM also generates comprehensive audit trails and supports specialized compliance reporting

BANKING Retail banking customers expect more personal and relevant communications from financial institutions that recognize their unique needs. They want each interaction to be timely and efficient. Banks that deliver a personalized experience will not only retain current customers longer, but also will maximize the potential long-term value of these customers. Select your business challenge:
Reduce Costs Grow Revenue Retain Profitable Customers Shorten Processing Time Ensure Brand Consistency

Whether youre banking globally or regionally, the document processing represents a major opportunity to reduce costs. How? By streamlining basic banking processes like account opening, Internship Report Page 22

mortgage and loan processing, and broad-scale document printing. REDUCES COST we help financial institutions improve and streamline processes that impact clients, client-facing staff and revenues. By reducing the time and expense required to onboard a client as well as the costs around equipment, supplies, service and power consumption we can help banks operate more efficiently. 1. Minimize or eliminate the need to courier documents between locations for processing. Digitization and electronic transfer of documents dramatically reduce the need for manual intervention in client account opening, residential mortgage processing, equity credit lines and personal loans. By drastically reducing paper, well help you remove process steps, better serve your clients and manage your bottom line. 2. Know the true cost of your print infrastructure. Whether its your corporate office, branch or back-office customer service and operations environment, we can manage all of your office devicesprinters, copiers, fax machines and scannersregardless of manufacturer or model. We also manage the supplies, maintenance, support and training that go along with them. Based on your specific requirements, we design the optimal document output environment for you. This helps you boost productivity and reduce costs by as much as 30% over time. 3. Reduce cost and waste stemming from preprinted inventories and obsolete collateral. By optimizing your centralized operations, we can deliver highly flexible, customized solutions. We can help manage your internal and outsourced document production -- like pitch books, client presentations and marketing materials -- while providing a single point of control. From job submission and high-quality color to complete finishing and distribution, we can take your operations to the next level. 4. Enjoy more sustainable operations. Optimize your print environment to use less paper, power and equipment. We thoroughly analyze your current print processes whether centralized ordistributed across local offices -- to help you make a real impact on your sustainability goals. As more financial services firms decrease their carbon footprint, the print environment is an optimal place to start to achieve a measurable impact.

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COMPANY BUSINESS PROCESS

Soneri Bank Limited was formally incorporated on September 28, 1991. The first Branch commenced operations in Lahore on April 16, 1992, followed by the launch of Karachi's first Branch on May 09, 1992. The bank currently operates 191 branches, spread all over Pakistan including the Northern Areas of the country. The banks expansion policy is based on the principle of maintaining a balance between the urban and rural areas. We take great pride in offering services even in the remote areas of Pakistan. Our fully airconditioned and computerized branches provide a pleasant, convenient and hassle free banking experience every time. The essence of our business philosophy is to cater to the banking requirements of small & medium sized entrepreneurs, effectively providing them qualitative & competitive services with emphasis on encouraging exports. Nearly forty percent of our credit portfolio is related to export financing and credit decisions are taken within 48 hours.

COMPANY DEPARTMENTAL FUNCTIONS

I did my internship in Soneri Bank Limited Thokar Niaz Baig Branch Lahore. This internship period comprises of 6 weeks. I work in almost all departments and learn about them and their working. Now I am writing about the departmental functions of the company from my learning.in this branch basically there are three main departments in which the other departments lies or relates to them. These are General Banking Department Trading Department Credit Department

GENERAL BANKING
General banking is the basic department of every bank. General banking is basically consumer banking. And I spent most of my internship period by working and assisting in general banking.

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Functions of General Banking Cell

1) 2) 3) 4) 5) 6) 7)

Clearing (inward & outward) Remittances General ledger transactions Issuance of Lockers Cash receipt and payment Cash management Stop Payments

CLEARING
I worked one week in this department. In this department I learned that how the clearing and transfer of money from one branch to another branch takes place. Following are the job responsibilities in this department:a) Clearing of inwards and outwards cheques b) Payment of IBC (Inward Bills For Collection) c) Lodgment of LBC (Local Bills for Collection), OBC (Outward Bills for Collection) and their Realization.

Cash paid voucher sheet, Paying-in-slip, Cheque Book, Cash balance book. The clearing in Karachi at SONERI BANK or other banks is being done through NIFT (National Institute of Facilitation Technology).

The banker's clearing is supervised by State Bank of Pakistan. Clearing arrangements are made so that banks exchange and settle for local cheques, drafts and other banking instruments drawn on each other deposited by their customers or received for collection or clearance.

Clearing is a system by which banks exchange cheques and other negotiable instruments drawn on each other within specified areas and thereby secure payment for their clients through clearing house at specified time. Internship Report Page 25

Clearing can be distinguished into two categories outward clearing & Inward clearing:

PROCESSING OF OUTWARD CLEARING (Collections)

Outward cheques are those cheques that are presented in the bank for collection. Cheques are received from the clients. These cheques are received along with a deposit slip. One part of the deposit slip is returned to the customer with a clearing stamp on it. The date of clearing is one day ahead of the current day, because it takes one day for a cheque to get clearance. The cheques are then sort out as local and outstation. The details of the cheque i.e. the amount, cheque number, the account number and the name of the Drawees bank are entered. These cheques are then prepared to be sent to the clearing house. SNBL sends the cheques through NIFT (National Institutional Facilitation Technologies Pvt. Limited). A slip and a sheet are along with the cheques to ensure that all the cheques are being entered and sent.

PROCESSING OF INWARD CLEARING (Payments)

Inward cheques are for payment on behalf of your account holder to the account holder of another bank. Exchange and settlement of cheques and other instruments is done in the clearing house. These cheques are received and then sort out. The process of sorting out includes checking of all the necessary and required particulars. The signatures are also verified.

PROCESSING OF RETURN CLEARING

If there is any particular missing in the cheques, then they are returned back to the clearing house along with the memo that contains reasons of return by selecting the specific reason.

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PROCESSING OF CHEQUES RETURNED

The cheques of the customers that are being returned by the Drawees bank due to any reason stated in the cheque returning memo are given back to presenting back in the clearing house. These cheques are returned to the customers and charges of Rs.200 are collected for it. If there are more than one cheques of the same customer then he is charged only Rs.200.

REMITTANCE
Transferring of funds from person to person, and from place to place, constitute the concept of a remittance. Remittance is very important service provided by banks to customer as well as non-customer. Soneri bank provides remittance facility to its customers. It is not a free service hence is a continuous source of income for the bank and includes the following modes, but these are not used so much now -a-days. Even that some banks have ended these types of remittance. I. Demand Draft II. Pay Order III. Mail Transfer In remittance department like any other SONERI BANK also have instruments for transferring of money, Telegraphic Transfer, Mail Transfer. In cash department both deposits and withdrawals go side by side. This department works under the CD In charge and deals with cash deposits and payments. This department maintains the following sheets, books, and ledger of account cash received voucher sheet.

Following were the job responsibilities during my internship period in this department. Issuance of Demand draft and their Computer feeding. Responsibility of DD Advice and its Payment. Issuance of Telegraphic Transfers and their feeding in Computer.

DEMAND DRAFT Demand draft is a written order, drawn by one branch of a bank upon another
branch of the same bank, or upon another bank under special arrangements to pay a Internship Report Page 27

certain sum of money to or to the order of a specified person.

Demand draft is a negotiable instrument. Demand draft is neither issued payable to bearer nor drawn on branches situated
within the same city.

It is to be insured that the purchaser of Demand Draft is able to at least sign his
name.

Thumb impression is not to be accepted on DD. A person unable to sign and not
having an account may be advised to apply for DD through a literate person to sign on his behalf. To avoid complications DD are not to be issued to Minors.

The followings are the parties to a Draft: I. II. III. IV. Purchaser: Is a person, firm, company or local authority. Issuing or Drawing Branch: This issues a draft on another branch. Drawee Branch: Is one on which a draft is drawn. Payee: Is a person named in the Demand Draft to whom or to whose order the money is directed to be paid.

PROCEDURE FOR ISSUANCE OF DRAFTS An application on printed form is obtain for issue of demand draft. It should be
properly filled in and signed by the purchaser.

Before issuing the demand draft it must be seen that the cheque is in order and
sufficient amount is available in the account of the drawer. If the manager is satisfied with the creditability of the customer, he may issue a demand draft on application and subsequently must obtain a cheque. Application form should be used as a credit voucher, whereas the cheque is to be as a debit voucher. The printed number of the cheque in such cases should be reported on the application form of the customer.

If the customer has no account in a bank then he may also apply for a demand draft
by providing cash at counter.

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Entries of DD
Entry in Issuing Bank Customer A/c Debit Head Office
---------------------------------------------------------------------------------

Credit

Entry in Drawee Branch Head office DD Payable

----------------------------------------------------------------------------------

Debit Credit

Entry when customer will draw amount from DD DD payable Customer A/c Debit Credit

----------------------------------------------------------------------------------

PAY ORDER Pay order is meant for banks own payments but in practice these are also issued to
our customer for making payments.

A pay order is written authorization for payment, made in a receipt form issued and
payable by the bank, to the person named and addressed therein on his giving a proper discharge thereon.

It is issued by and drawn upon and payable by the same branch of the bank. It is neither transferable nor negotiable and as such it is payable to the payee named
therein.

Pay order cannot be issued to a minor. Sometime bank dont want to give its
deposits to customer. So in that case pay order is given to that customer and he can Internship Report Page 29

use it for making payments. When customer wants to cash the pay order then the amount of the pay order will be debited from the bank. If pay order submit to other bank like MCB, ABL then the process of clearing will be adopt.

Following are the parties to a pay order: I. Purchaser: Is a person , firm , company or local authority II. Issuing / paying branch: This issues / pays on presentation. III. Payee: is a person named therein.

Entries of issuance pay order

Customer Pay order payable Debit Credit

--------------------------------------------------------------------------------Entry when customer get amount from pay order Pay order payable Customer Debit Credit

---------------------------------------------------------------------------------

MAIL TRANSFER
Transfer of funds from one branch to another branch of the same bank within or outside the city or upon other bank under special arrangement for the payment to the beneficiary through Mail/ Courier services is called MAIL TRANSFER. A fund application is submitted by the customer. The mail transfer instrument is not delivered to the applicant, but instead it is sent by the issuing office to the beneficiary's branch. This type of remittance facility is provided only if the beneficiary is the customer of the bank. The amount is directly credited to the beneficiary's account. A bank's customer can very easily remit the funds from one place to another, by giving instructions to the bank.

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Credit balance of the customer can also be transferred from one branch to another with the help of this instrument. The customer can either deposit cash or get his account debited by the amount that is to be remitted, including the bank charges. Mail Transfer advice is prepared and the test number if written on the MT advice. The advice is given to dispatch department for onward transaction. The particulars of mail transfer are recorded in a mail transfer register. Mail transfer is not negotiable. The funds remitted by Mail transfer are not payable to bearer.

Like TT, funds can be remitted by MT for the credit of the payees Account or the payee / beneficiary can be advised to receive the amount from the Drawee branch either on cash on proper identification. But now-a-days these types of remittances are not used by the banks. Today bankers cheque is its modern type which is drawn by the bank to the other ban k out of city or in a city which is confirm payment.

GENERAL LEDGER REPORT

General ledger transactions consist of general ledger report . There is a list of general ledger transactions statements that consists of debit and credit statements. The effect of a transaction is nilled by the opposite transaction of same amount. The debit statement is the nilled by the credit transaction of same amount. In this way all the credit and debit transactions are nilled by the debit and credit transactions of same amount. So the effect of all transactions becomes zero.

ISSUANCE OF LOCKERS
SNBL provides safe deposit locker facility to its customers for saf e keeping of their valuables like precious documents, securities and jewelry etc Thokar niaz baig branch has two sizes of lockers.

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Medium In this locker the customer has two options. One is the key deposit of Rs.2000 and annual rent of Rs.1700 on it. The second is the key deposit of Rs.30, 000 which is refundable. Large In this locker the customer also has the two options. One is the key deposit of Rs.2000 and annual rent of Rs.3500 on it. The other is the key deposit of Rs.40, 000 which is refundable at the time of return.

RECEIPTS AND PAYMENTS

Separate counters for depositing cash or cheques and payment of cash against instruments are present in the branch. Cheques are received and payment is made against them. The signatures of the cheque are being verified by the CD in charge or manger operations. SNBL also provides On Line Banking facilities to its customers. On line banking is becoming an important element of the modern banking the on line banking is a time saving and quick process of receiving and making payments. Keeping in view the importance of online banking facilities to get a competitive edge the SNBL provides the online banking facilities. On line banking mean that transfer of payments and receipts on line. The account holder enjoys the online facility and the receiver can receive amount just in few minutes. This branch after confirming the balance from their account will make the payment to that person instead of receiving that payment in two or three days through clearing.

6. CASH MANAGEMENT
This is done by balancing all the cash receipts and payments in the branch. It also includes transactions with other branches and internal transfer of funds.

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7. STOP PAYMENT
The department also makes arrangements for stop payment of cheques on the request of the client. The request of stop payment is made in the following case

The cheque has been stolen or lost To cancel the cheque, which has already been written out, and handle to the
counterpart, and the client will request the bank not to make the payment if presented.

ACCOUNT OPENING DEPARTMENT

Account opening department is the most important department in any commercial bank's operations. The reason is that it serves as a first step in establishing customer-bank relationship. The main objective of any bank is to attract as many new accounts and deposits as possible. In order to fulfill this objective the first step is the opening of new accounts and maintaining the existing ones. The department of account opening is the major source of doing so. That is why such departments are maintained by all the banks in all their branches. SNBL thokarniazbaig branch has an account opening department that provides services to new as well existing customers. It provides a wide range of services to its customers and is strongly oriented towards providing banking services to the needs of a business. Understanding the customer requirements and guiding them accordingly is the basic function of this department. This Branch is having about 2000 accounts but there was only one officer, Mr. NaumanAkhtar to handle this tough work. He has to deal different people. My experience in this department was really very good. I learnt how to handle different customers, how to fill Account Opening Form, what are the required documents that should be with you in order to open an account, what types of account Bank is offering to the customers, what are the facilities that an account Holder can enjoy etc. I have learnt the procedure that an Account Opening Officer has to follow in order to open and maintain an Account.

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Functions of Account Opening Department

1. 2. 3. 4. 5. 6.

Account Opening Issuance of Cheque Books Scrutiny of cheques Posting of Cheques Account Closing Customer Service

ACCOUNT OPENING
It is the first and major function of the department. There are various steps involved in opening of an account. When a person wants to open an account with the bank he is required to fill an account opening form. Along with this account opening form certain documents are to be attached to start a customer-bank relationship. There are certain formalities to be fulfilled before opening an account depending upon the nature of account and the nature of the customer.

PROCEDURE

ACCOUNT OPENING FORM: A printed account opening form along with the requisition slip and the signature card is given to the customer. The conditions for opening the account are also attached with the form. It includes information regarding the customer's name, address, N.I.C no., telephone no., Information about the account holder's successor is also to be fille d in the account opening form. This information is required to obtain the legal successor appointed by the account holder. And after that these forms are authorized by the Branch manager and then further proceedings takes place.

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INTRODUCTION: The customer whose account is to be opened has to be introduced by an existing account holder of the bank. The introducer is the person who makes an introduction of the account opener by signing on his account opening form. The introducer should known of the

account opener and should know that the customer is bonafide i.e. he is opening the account in his real name. Introducer is not a guarantor. His only responsibility is to locate the customer if any problem comes up. The main purpose of getting the introduction o f the account opener is to Avoid any serious consequences Desirability of the customer Respectability Occupation and nature of business of the customer To get maximum information about the customer

REQUIRED DOCUMENTS: Photocopy Computerized NICs of All concerned parties. Photocopy Passport, if NIC is not available Vernacular Form if signature are not in English Any photo ID in CNIC is not carrying a photo Three passport size photographs with thumbs impression for illiterate individuals or having shaky signatures Undertakings of signature differ with CNIC signatures.

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ADDITIONAL REQUIREMENTS: Personal (Individual or Jointly)

Salaried Individuals Employment certificate by the employer acknowledgement the individual as an employee along with his salary, designation and period of employment on the letter head and signed under rubber stamp of company/ organization/ firm/ proprietor etc Attested copy of service card or any other acceptable evidence of service, including, but not limited to a certificate from the employer

Self-Employed/Business men Copy of NTN certificate of the individual

For Sole Proprietorship, letter from the proprietor confirming proprietorship (Format available on request) A letter head along with a rubber stamp for proof of business or any other acceptable evidence for verifiable source of income

Sole proprietorship Letterhead from the proprietor confirming proprietorship(Format available) Rubber stamp of the company Copy of CNIC Copy of NTN Minor Account Form B (Birth Certificate) Guardians NIC

Limited Company Board Resolution resolving to open an account and specifying the persons authorized to operate the account. Attested photocopies of Computerized CNICs of all the directors Internship Report Page 36

Certificate of Incorporation Memorandum and Articles of Association (First and last page signed and stamped by CEO or Company Secretary) List of Directors on Companys Letter Head duly signed by Chief Executive or Company Secretary Latest Copy of Form-29 duly attested by SECP Rubber stamp with designation on all documents Certificate of commencement of business (Public limited Company only)

Partnership Attested copy of Partnership Deed duly verified by notary public and signed by all partners of the firm. Attested copy of Computerized NICs of all partners Rubber stamp of partners Partnership Mandate on letter head to operate the Account Attested copy of registration certificate (Form-c)- for registered firms only Attested copy of NTN Certificate

Clubs/Societies/Associations Certified copies of rules/ by-laws Certified copies of Certificate of Registration Resolution of the Governing body/Executive Committee for opening of account authorizing the persons to operated the account and attested copy of the authorized person An undertaking by all the authorized person on behalf of the institution mentioning that any change will be informed to the banker immediately

Trusts Attested copy of certificate of Registration Attested copies of Computerized NICs of all the trustees Certified copy of instrument of Trust (notary public) Board Resolution resolving to open and operate the account Internship Report Page 37

Certified copy of By-laws

FILLING OF KYCS: KYCs (know about your customer) are the bank documents that contain the complete informations of customers that include their personal information, about their work, job and business and their total annual income and the amount of their total wealth in case of business.

VERIFICATION OF DOCUMENTS AND ISSUANCE OF ACCOUNT NUMBER:

The documents provided by the account opener and their KYCs are verified by the department head. In SNBL this verification is done by operations manager. The signatures are also verified and a signature card is maintained for the purpose of future verification if required. The account is then entered into the bank's system and processed for getting the account number and the customer number. This system number comprises of following components Branch code: Account type code: Customer number.

And before it all the process of verification of documents and their stamping is done.

MINIMUM CASH REQUIREMENT:

After providing the properly filled form and all the necessary documents the account holder has to deposit the minimum cash requirement for opening a specific account according to bank's rules. The customer's account is opened after following the above stated procedure .

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LETTER OF THANKS:
After this process a letter of thanks is sent to the customer in order to verify that the address provided by him is correct.

ISSUANCE OF CHEQUE BOOK:

At the time of account opening a slip is also filled for the receiving of cheque book. After the customer brings the letter of thanks to the bank he fills in the requisition slip for obtaining a cheque book and receives the cheque book. This makes him the account holder of the bank and now he is able to operate his account. The cheque book is of three types.

1) 25L 2) 50L 3) 100L When one cheque book is finished the customer has to fill up a requisition slip at the end of the cheque book and apply for a new cheque book.

SCRUTINY OF CHEQUES

On completion of formalities referred above the cheque is handed over to the ledger keeper and other instruments to the concerned departments. Ledger keeper will again scrutinize check and verify the points as given below:The account on which cheque is drawn is neither closed nor dormant or inoperative. It bears token stamp on the reverse. The cheque is of our bank and the branch. The cheque is out of the cheque book(s) issued. The signature of drawer is there. The account number, title of account is there. Page 39

Internship Report

Is not un-dated, post-dated, stale or out of date. Payment of the cheque has not been stopped by the drawer. There is no legal bar for the payment of cheque account is not attached, under lien or the account holder is deceased. The funds are available/sufficient to honor the cheque i.e. the amount does not exceed the credit balance of the account (or the un-drawn portion of the sanctioned drawing power in case of cash finance account or current account) having approved running finance facility. Amount in words and figures tallies. No. previous entry in the ledger is un-authenticated. In case it is drawn on account marked as similar account, it should be ensured that the cheque is being posted to the correct account. Endorsement made thereon is prima facie in order. Alternations/mutilations/cuttings/over-writings, (if any) is confirmed by the drawer under his full signatures. In case cheque is presented in transfer delivery, Transfer Delivery stamp is affixed. The collecting banks discharge is in order. Crossings of other bank (if any) are properly cancelled. Where the cheque has been presented through clearing, it bears crossing and clearing stamps of the same bank with date.

POSTING OF CHEQUES/OTHER INSTRUMENTS AND FIXATION OF STAMP AS PER NATURE OF PAYMENT

After proper scrutiny the cheque is posted in the ledger/card folio number/sheet number of the account is entered on the top left corner of the cheque and Pay Cash or TRANSFER stamp as the case may be is affixed on the face of the cheque. The ledger keeper shall sign on the cheque with the narration Entered to signify that it has been posted after proper checking and is in order.

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ACCOUNT CLOSING:

It is the third function of this department. For closing an account the customer is required to Submit a signed account closure request

REQUEST FOR CLOSURE OF ACCOUNT I/We am/are maintaining account no............................ Titled ....................................................with you. I/We request you to please close my/our account. Unused cheque containing...... leaves is also enclosed.

Surrender the cheque book with the bank Pay a statutory fee of Rs. 220 to the bank

The account opening officer gets an annexure approved by all the departments and then closes the account. This is a sort of clearance from all the departments. The cheque book is then destroyed. Account closed log file is printed in order to complete the process of closing an account. In the end the account opening form is filed in the closed accounts file.

CUSTOMER SERVICE:
This function is also performed by account opening department. It is the customer service provided by the bank which ensures loyalty of customers and new accounts and deposits. Any service that a customer requires should be provided in order not only to satisfy him but also delight him. The following services are provided by the account opening department Internship Report Page 41

Balance confirmation The account opening officer is responsible to provide answer to inquiries about balance on telephone as well as personal visits of the customers. Cheque clearing inquiries Account number confirmation Issuance of statements The bank provides statements of accounts on the requirement and instruction of the customers. Normally the bank sends the statement of account after every six months but if desired by the customer the statement can be sent on quarterly basis monthly basis or even weekly basis.

TYPES OF ACCOUNTS
Soneri Bank Limited is currently offering following deposit accounts: 1. 2. 3. 4. 5. 6. 7. 8. Current Account P&L Saving Account Basic banking Account Soneri Saving Account Soneri Sahara Account SoneriIkhtiar Account Running Finance Account Foreign Currency Account

CURRENT ACCOUNT Current account is Non interest bearing checking account and is opened and used for business purpose and is opened by an amount of Rs. 10,000 that are deposited in the account at the time when the account is opened. The account holder can done unlimited

transactions and can withdraw or deposit money without any limit in a day during the banking hours.

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P&L SAVING ACCOUNT Profit & loss saving sharing account is for salaried persons whose salaries are not so much. So that they can save some part of their income for th eir future uses. In this account they receive profit at the rate of 5% annually according to the interest rates and terms and conditions of the state bank of Pakistan and their company. Minimum account opening requirement is Rs. 5000 only. Pls saving account holders accounts number starts from 0101.

BASIC BANKING ACCOUNT Initial deposit for account opening is Rs. 1,000 with no minimum balance requirement. Basic banking account is Non interest bearing checking account. Maximum 2 deposits & 2 withdrawals through cheque are allowed. . There is no restriction on ATM withdrawal. But no online facility is provided. Basic banking account is also for small businesses and salaried persons but there is a limit of transactions in this account in a day. Like curr ent account Basic banking account holders account numbers also starts from 0205.

SONERI SAVING ACCOUNT Soneri saving account holders accounts numbers starts from 0102. And in soneri saving account the account holders receive profit at the rate of 5% on 100,000, 7% on the deposit of (Rs. 100,000 - Rs.1000, 000), 8% on (Rs. 1000,000 5000, 000) and 9.5% on above than Rs.5000, 000.

SONERI SAHARA ACCOUNT Soneri Sahara account is for senior and old age citizens and retired persons. Soneri Sahara accounts starts from 0108.

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SONERI IKHTIAR ACCOUNT Soneriikhtiar account is for corporate businesses that open by the deposit amount of Rs. 50,000.

RUNNING FINANCE ACCOUNT Running finance account is for those account holders who need some finan ce in order to run or setup their business. Running finance account starts from the serial number of 081.

FOREIGN CURRENCY ACCOUNT Foreign currency accounts holders account numbers starts from 0219, 0118 and 0119.

COMMON BENEFITS OF THESE ACCOUNTS Following are the combined benefits of all the accounts that an accountholder can avail, those are

Free Cash Deposit and Withdrawal facilities through your bank branch Free Clearing facility to deposit cheques of other banks within the city Online Funds Transfer through Cheques to any account across Pakistan through your bank branch Online Cash Deposit, Withdrawal and Funds Transfer through cheques from any of our branch across Pakistan Remittance facilities such as Payment Orders, Demand Draft, Telegraphic Transfers Rupee Travelers Cheque through your bank branch Import, Export and other business transactions Statement of Account on six monthly basis Usage of Electronic Banking through: o ATMs across Pakistan owned by Soneri Bank and other banks o Free 24-hours Telephone Banking and Call Centre facility Internship Report Page 44

o Free 24/7 Online Funds Transfer to any customer of Soneri Bank through ATMs owned by Soneri Bank o 24/7 Online Inter Bank Funds Transfer through ATMs owned by Soneri Bank to any account of increasing list of enabled 1 LINK member banks o Utility Bill Payments through ATM, Internet Banking and Call Centre o Free 24/7 Internet Banking All purchases and cash withdrawals made with the Soneri Banking Cards is deducted directly from your bank account Free Cash Withdrawal on ATMs owned by Soneri Bank Facility of Running Finance for specific purpose against collaterals and nominal markup rates being charged on quarterly basis etc.

ATM DEPARTMENT

ATM is the automatic teller machine that provides facility to withdraw cash any time from the atm machine, and prevents customer from the risk of keeping money in pocket. And is a convenient source of withdrawing money ATM department is responsible for the issuance of new ATM card and after that issue of atm in this regards. In order to have a new atm card the customer has to apply for the card at the time of account opening by filling an atm form that contains his\her name,fathers name, account number and other information and for what type of card the customer is applying for because atm card is of two types I. II. Classic Gold

The form is authorized by the branch and operations manager and is being processed and finally customer can receive it within the four working days of the bank after fulfilling the receiving criteria. There are some charges of atm card that are detected annually. These charges are separate for both classic and gold card

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For classic card the customer has to pay a fee of Rs. 200 annually in advance excluding the money transactional tax. And with classic card the customer has a limit of withdraw money until Rs25000 in a day not more than it. And with gold card the withdrawal limit is until Rs.50, 000 in a day and its annual charges are Rs.500 that is other than the transactional taxes.

In case if the machine has captured the card, the customer has to contact to the ATM officer and the officer will give card to the customer after the recei ving criteria is done.

ACCOUNTS DEPARTMENT The most important aspect in record keeping of a bank is its accounting system. The basic purpose for maintaining an accounting system is to ensure consistency in record keeping and accounts. The accounting system used in SNBL is given in a manual, which states all the accounting practices to be adopted while recording any transactions. I used to help department in Daily Activity checking, sorting and counting of vouchers and how to calculate the deprecations of all fixed assets. I learnt the items of the Balance Sheet of Bank and saw the format of different reports. All officials helped me to understand his work. They told me about the reports that he has to prepare & the purpose of those reports. It was one of those Departments in which Customer interaction is not involve rather paper interaction is important.

The basic requirement for any accounting system is that it should be in accordance with the GAAP (Generally Accepted Accounting Principles). There are two choices available to an organization for an accounting system.

An account department is actually a concluding department, which summarizes and consolidates all the accounts of different department. And the Accounts Department of SNBL performs the following activities. 1. Daily Reports Activity Verification 2. Rectification of Errors Internship Report Page 46

3. 4. 5. 6.

Head office/Branch reconciliation Reconciliation with state Bank of Pakistan. Foreign Exchange- Old Accounts Contracts (forward contracts) Reporting

ACTIVITY VERIFICATION The different department of the branch does their work through out the day the employees post their vouchers in the computers and also prepare the vouchers manually. Activity checking is the manual checking of all the debit and credit posted vouchers. The vouc her of the today will be checked tomorrow according to the activity generated by the computer and manually prepared voucher. It makes the more accurate work of the employees. It is a type of check on the employees which shows the efficiency and accuracy of the employees. The voucher are sorted into the different heads according to their nature and then different bunches are made which are then checked by the responsible officer. At the end of the day a report is prepared containing the figures and name of b unches and voucher in each bunch. The other report that is prepared after checking the activity that contains all the discrepancies of the activity and the number of employee who did the mistake.

RECTIFICATION OF ERRORS If there is any error found out during activity verification, it is rectified and communicated to the respective departments. These errors might be some mistakes in the face of the instrument or the signature requirements

HEAD OFFICE RECONCILIATION There are number of transactions which take place between. In order to be balance with the head office the account department did reconciliation in order to be in balance with the head office at the end of the day.

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STATE BANK OF PAKISTAN RECONCILIATION The SBP is the central bank of Pakistan therefore each schedule bank will be controlled by the SBP therefore a number of transactions occur with State Bank of Pakistan. The daily statement of SBP is matched with the balance with SBP in order to be in balance with SBP.

FORWARD CONTRACT (OLD FOREIGN CURRENCY ACCOUNTS) There are two types of account operate in foreign currency the accounts which were frozen by the Government in 1998 after nuclear tests are called frozen (old accounts) and accounts which are opened after that are called New FCA. The amount in the old account will be paid in form of rupees. Whenever any amount in dollar comes state bank purchase it from the bank and enter into a forward contact that mean that bank will repurchase these Dollar after certain period at decided rate. The period is normally one quarter. The bank also pays an advance fee for this which is charge to the whole quarter. At the end of the quarter the SNBL will purchase from SBP at the decided Rate and transfer (Sell) to the Head Office at the current rate prevails in the market. The difference between the selling price (to the head office) and purchase price (from the SBP) will adjust as exchange difference account. This contract can also be roll over at the end of the period.

REPORTS Report generation is one of the most important functions of the accounts department. It is important for the proper management control.

FOREIGN TRADE
Trade department deals with imports and exports at national and international level I have not worked in this department so much I just learn about the working of this department. Furthermore SONERI BANK also deals with foreign exchange, foreign Currency Accounts, Foreign Remittances, and Foreign Bills for Collection. Foreign currency accounts & the foreign currency department deals with these types of accounts, Current account, saving bank account, Term deposit. Foreign accounts are convertible on floating rate available to the bank. Letter Of Credit facility is being provided by SONERI BANK in foreign exchange. Internship Report Page 48

This provides these following services.

IMPORTS
L.C Opening L.C Amendment L.C Settlement Acceptance Booking Acceptance Payment Forward Booking Forward Take up Reporting to SBP on I Form

EXPORTS
Issuance of Export Forms Certification of E Form L.C Advising L.C Amendment Advising L.C Confirmation Processing Doc. Negotiation Payment of Doc. Negotiation Reporting to SBP on Form E

IMPORT L/C CYCLE

There are primarily five parties involved in the whole process of an L/C. Importer Issuing Bank (importer's bank) Advising bank or Correspondent bank Exporter Beneficiary bank (exporter's bank)

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STEP 1:
A deal between the importer and the exporter is made.

STEP 2:
Exporter sends Performa invoice to the importer through fax or mail. The exporter endorses it i.e. makes his approval on it. One copy is sent back to the exporter and one is taken to the bank.

STEP 3:
The issuing bank or the importer's bank inspects the Performa invoice and other documents like the application, form I, import registration etc. and opens the L/C .

STEP 4:
Now the issuing bank sends this L/C to its correspondent bank in the exporter's country.

STEP 5:
The correspondent bank advises the L/C to the exporter's bank.

STEP 6:
The exporter's bank informs the exporter about the L/C and then the exporter starts producing the goods or ships the goods, whatever the case may be.

STEP 7:

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The exporter provides the documents of shipment e.g. the bill of lading, pre -shipment report etc to his bank and gets the payment after deduction of some pre determined charges.

STEP 8:
Now the exporter's bank will send those documents to the issuing bank to get the payment. Another option is that the beneficiary bank might negotiate the documents with some other bank.

STEP 9:
The issuing bank after receiving the documents informs the importer and tells him to make the payment. The importer makes the payment with some pre determined charges and gets the shipping documents from the bank. The importer after that gets the goods released from the port. If immediate payment is not made by the importer to the bank, then the bank might keep the imported goods in its possession till he makes payment.

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IMPORT L/C CYCLE

Performa Invoice

IMPORTER
Performa Invoice

EXPORTER

Funds P/I

B/L

L/C Advised

ISSUING BANK

Bill of Lading

BENEFICIARY BANK

Funds

L/C Advised

C/L

CORRESPONDENT BANK

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EXPORT L/C CYCLE

It is the reverse of the import cycle. Following steps are involved in the export cycle of L/C:

STEP 1:
When L/C is received by the exporter's bank, it advises the L/C to the exporter and by doing so it becomes the Advising Bank. A photocopy of the Original L/C is prepared and sent along with the Cover note stating that the Original L/C is with the bank and the exporter may collect it after paying the Advising charges.

STEP 2:
After the exporter gets hold of the L/C, the next step is to issue E -Forms. E- Form is in Quadruplicate and is issued when the exporter submits an application to the bank. E -Form contains the following information: Export Registration Number Type of Goods Quantity of Goods Port of shipment Port of Destination Value of Goods Mode of shipment (Air/Sea) Tenor (Sight/DA) Term of payment

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STEP 3:
Once E-Form is issued to the exporter/it is to be certified by the State Bank of Pakistan within 14days after the date of its issuance. And the goods must be shipped within 21 days after the date of certification of E-Forms. All the details about the goods mentioned in the E-Form are then entered in to the E-Form register. It includes: E-Form #

Name of the Exporter Value of the L/C Port of destination Mode of shipment E-Form further states that the maximum number of days for which L/C can be opened is for 180 days. After filling in all the details the register is sent for the final approval by the head of the department.

STEP 4:
After the verification of E-forms, the next step for the exporter is to manufacture the goods according to the specifications mentioned in the L/C. The documents to be submitted by him include:

BILL OF LADING:
It is a receipt issued by the Shipping Company, which undertakes to ship the consignment to a stated destination signed by or on behalf of the master of the ship.

PACKING LIST:
It shows the details about the goods, method of packing, the net and the gross weight of each individual item and the total weight of the consignment. Internship Report Page 54

 COMMERCIAL INVOICE:
It is a document, which describes the goods, unit and/ or total price, shipping terms, buyers and seller's references, etc.

CERTIFICATE OF ORIGIN:
It is a document, which confirms that the goods have been made or manufactured in a stated country. In Pakistan, it is issued by Chamber of Commerce and Industry. This document is not compulsory but should be provided if demanded.

STEP 5:
When the bank receives documents, the bank scrutinizes these documents. This is done to check whether the documents are in accordance with the L/C or not. If these documents don't match the specifications mentioned in the L/C, documents are said to be Discrepant. Exporter is informed about it and is asked to provide the relevant documents free of discrepancies. It is the choice of the exporter to either negotiate the documents or to send them for collection.

COLLECTION:
If the documents are sent for Collection, then the bank sends the documents on behalf of the Exporter and waits for the bill of exchange to mature on a specified date.

NEGOTIATION:
Negotiation can be defined as: A method of finance in international trade whereby the banker will discount an exporter's bill of exchange and therefore credit his account with the face value of the bill less interest and other charges. After the documents are negotiated, amount is paid to the exporter and Internship Report Page 55

finally the documents are lodged. Income on courier, with holding tax and margin is deducted from the exporter's account.

MARGIN REQUIREMENT:
Margin required by the bank from a company depends upon the relationship between the company and the bank. Incase, if a party comes to the bank for the first time to do business then margin required by the bank may be 100%. This is done solely to keep the bank on safe side in case the party defaults. On the other hand, if the bank has a long standing relationship with a company, in that instance; it may not ask for any margin.

STEP 6:
At the end, the documents are mailed to the L/C opening bank. A Cover Page is prepared which shows the name of the Exporter's bank; value of L/C; documents and the number of copies and the maturity date. Usually the documents sent consist of: I. II. III. IV. V. VI. 3 Bill of Ladings 2 Bills of exchange Commercial Invoice (number as required) Certificate of Origin Packing list Commercial Invoice When the documents are sent to the importer, the bank then awaits the payment.

EXPORT REFINANCE SCHEME

In order to avail the facility of export refinance the exporter should be registered with the Export Promotion Bureau and Chamber of Commerce.

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In Export Refinance three parties are involved

EXPORTER Exporter

Exporter Financed

Bank Refinanced STATE BANK OF PAKISTAN

COMMERCIA L BANK

Application for Finance

Application for Refinance

Under Export Refinance the Exporter goes to the bank with a request to finance him showing the evidence that he has been given an order to manufacture goods and export it. The bank finances the exporter after and then the bank goes to State Bank of Pakistan asking for a refinance.

The Commercial bank has to present as evidence before the State Bank the following documents showing that it has financed the exporter.

Original Letter of Credit or Contract Demand Promissory Note Undertaking stamp Paper (Rs.100/-)

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REFINANCE:
The State Bank of Pakistan provides refinance for a period of six months and it has been divided into two parts

REFINANCE

PART 1

PART 2

Pre-shipment

Post shipment

PART 1:

PRE-SHIPMENT:
It means the finance needed to prepare the consignment before shipment is made. This happens when the exporter shows the original L/C or the contract to the bank. The bank keeps the Original L/C under lien along with the Demand Promissory note and an undertaking stamp paper, which costs Rs.100/-. When the bank finances the exporter the Internship Report Page 58

case is then referred to State Bank of Pakistan. The State Bank issues a demand loan number to the bank signifying that this is the loan which is being granted to the bank. T his Demand loan has got a maturity date before which the commercial bank has to repay to the State Bank. At the date of maturity the bank has to give an Invoice, Duplicate Form -E Original and first copy of Bill of Lading. This is given just to show that fi nance was provided to the exporter.

POST SHIPMENT:
In case of Post Shipment, when the exporter is financed the case is referred to the State Bank. At the maturity date the financing has to be returned back to the State Bank. These days banks charge an interest rate of 8% form their customers and pay 6% to the State Bank of Pakistan.

PART 2: In this scheme the exporter can avail finance limit equivalent to 50% of his export performance during the preceding year. At the end of year two statements are prepared for all the parties doing business with the bank. These statements are: Export Earning Export Financing

EXPORT EARNING :( EE)

It includes all those items, which are exported to foreign countries through out the year by a single company

EXPORT FINANCING :( EF)

It includes items from the statement of Export Earning but only those items are included against which refinance has been availed by the party.

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CREDITS AND CREDIT ADMINISTRATION DEPARTMENT

Advances department plays a vital role in the functions of a bank.. The main source of Advances department is mark up. Its Credits department is working under the trustworthy, enthusiastic and committed staff. Bank provides this facility to the people who need advance money to meet their requirement. Party dealing with other banks financial condition of borrower business and as a first step credit proposal is being made. SONERI BANK provides advances, which are two types. Secured Advances, Unsecured Advances. SONERI BANK usually classified advances in to following types Commercial Corporate SME Commercial Advances are of following types Demand Finance, Cash Finance, Export Refinance Part I (Pre Shipment) & others. The SNBL provides loans to customers. These loans are sanctioned by the head office. I just learn about it for the sake of report because I have not worked in this department much.

Moreover the credit department also provides finance facilities to its customers for the following categories according to its terms and conditions and rules. Th ese finance categories are

CAR FINANCING Learning From the Car Finance Department

This department handles a large number of customers daily and, without overstatement; this department is the third busiest department after the Account Opening Department. It requires constant customer interaction and requires high level of intelligence to screen the validity of the customers. Where as sound marketing skills are required to actually force the walk-in customer to select Soneri Car Financing; still stronger skills are needed to scan the incoming customer for validity. I learnt how to face the customers conveniently, how roper files should be maintained, how to apply for a car, what are requirement to apply for this Product, what is that maximum limit, what is the procedure to this department. Internship Report Page 60

RUNNING FINANCING Learning in this department

This department was at second floor of the branch. This department is giving a huge amount of return to the branch. What are the documents that are required from different type of client like sole proprietorship, Partnership, company and trust. How the risk can be evaluated. Preparations of offer latter, Credit line proposal, approval process, Borrowers Basic Fact Sheet for SMEs, Financial Statement of applicant.

HOME FINANCING Learning in Home Finance department

I saw few customers in this department. I learnt what the debt to equity ratio is in Home Finance, how to calculate installment, what are the documents required to get this product, what the eligible criterion is for Home Finance Agreement, and what is the procedure and activities of this department. What are requirement to apply for this Finance, what is that maximum limit. These are the major functions of this department. Following is the further procedures of the functions of this department.

Features of credit department

It provides loans to different organizations, and against these loans kept securities, Proper judgment of these securities is also its duty. Proper judgment of securities is the most crucial event in the process of lending. Because in the case of default, the securities are the only compensation to the bank. Default mostly is the result of improper judgment. In the process of judgment they fol low the following principles:

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1. SAFETY
I. character II. capacity III. capital

2. LIQUIDTY 3. DISPERSAL 4. REMUNERATION 5. SUITABILITY

There are basically two types of financing I. Fund Based II. Non-fund Base

I. Fund Based Financial Activities These include all those facilities in which the disbursement of funds takes place from the bank to the borrower. Examples of fund based facilities are

Running finance Term Finance Syndication/ Consortium Financing Negotiations of Export bills under L/C Pre shipment Finance (Packing Credit) Import Financing o Finance against imported merchandize (FIM) o Finance against trust receipt (FTR)

Contract Financing
II. Non-Fund Based Financial Activities These include guarantees of payment or performance of a contract, on behalf of the customer. Examples are

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 Letters of credit Letters of guarantees A. Shipping Guarantees B. Bid Bonds C. Advance Payment Guarantee D. Performance Bonds E. Others

STEPS INVOLVED IN PREPARATION OF CREDIT LINE PROPOSAL

STEP 1: INVESTIGATING PROCESS: Knowing the market place Risks inherent in lending like marketability risk, default risk, earnings fluctuation risk etc. Visits to the borrower's place Plan visit and filling the visit report Group accounts and bank exposure Determine facility wise borrowing STEP 2: CONSIDERATION FOR LENDING: Projected earnings from funding facility Anticipated business related to this funding facility

STEP 3:

PURPOSE OF LOAN: Reasonable Manageable

STEP 4:

REPAYMENT (SOURCES): Identification of sources of repayment Page 63

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STEP 5:

SECURITIES: Bank deposits Govt. securities Property etc.

STEP 6:

VALUATION OF SECURITIES: By valuators SNBL Bank hires the services of a lawyer and gets a legal opinion from him about any security.

STEP 7:

EXISTING CHARGES: Value of existing charges Residual left after satisfying the existing charges .

STEP 8:

NEGATIVE COVENANTS: Restrictions on loan agreement.

SECURITY DOCUMENTS: Agreement for R/F term of short term on mark-up basis Agreement for D/F 85 T/F of s/m/1 term on mark up basis Memo of confirmation of sale and buy back Letter of set off Letter of lien Letter of lien authority to marketable securities Instrument of pledge Trust receipt Letter of continuity Promissory note Installment letter Agreement of hypothecation Page 64

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Letter of agreement/undertaking Authority to debit accrued mark-up

Up to the level of approval of the credit for a client, all the activities are done by Credit Department and afterwards all of the monitoring efforts are carried out by the Credit Administration Department i.e. security management, whether the client is still in the sound financial position as he was at the time of issuing credit or not, whether the credit limit of the client is expired or not, whether the client is fulfilling all the requirements which were set at the time of contract or not, remedial management, etc, etc.

FOREIGN CURRENCY ACCOUNTS DEPARTMENT

This department deals with the account of foreign currency.

FOREIGN REMITTANCES
All the foreign remittances are carried out through Demand Draft (DD) and Telex transfer (TT). FOREIGN DEMAND DRAFT (FDD): If anybody wants to send a draft then he has to deposit a check equal to the amount being transferred. Application for the FDD is to be filled out which includes the following information.

Name & Address of Beneficiary Name and Address of Applicant Amount in foreign currency Amount converted in to Rupees (Figures & Words)

After the applicant has filled out the form then it is entered into FDD register. Dollar amounts are written separately while the other currencies are entere d in the other section. A voucher is also prepared which shows that the transaction is authenticated. It must be ensured that the applicant has enough cash in his account so as to debit his account with the amount being transferred plus the Commission of t he bank. Internship Report Page 65

DD cant be issued from single customer account to in favor of companies DD can be issued from companies account to in favor of single customer account It cant be issued for a walking customer

FOREIGN TELEX TRANSFER (FTT): FTT is almost similar to FDD as same procedure is followed except the fact that a when a Telex is sent a Test is applied on it. It is a precautionary measure, taken by the banks to ensure the safety of transactions between banks.

TYPES OF TELEX TRANSFERS

INWARD TT: When a bank belonging to a foreign country says that credit this account by this much amount (from outside) and they themselves debit the party account with the stated amount and the TT charges. On the other hand the beneficiary's account is credited with the concerned amount.

Outward TT: In outward TT the bank debits the party account with the amount being sent, along with the charges deducted (the party sending the amount) and asks the other bank to credit their account. This in turn credits the beneficiary's account. TT is much faster m ode of payment as compared to DD.

DOCUMENTATION Outward or Inward Diligence Form R-Form (For Encashment in PKR)

In this 6 weeks period, at soneri bank limited, I have gone through almost all the departments except two departments and tried to understand and learn the process of all Internship Report Page 66

the activities and these are: Maintenance of Account opening registers and folders. I have also learnt how to open an account, documents necessary for account opening Phone banking i.e. Inform callers about their current account position. Counting of the total no of Cheques presented for clearing. Sent those Cheques to the Area Office for clearing. Checks the Stamping on cleared Cheques and enter those cheques in record. Issuance of DD and Pay orders local and foreign both. Maintenance of Remittance registers. To check the folders consisting of inward and outward remittances and telegraphic transfer. To fill incomplete documents. L.C Opening and its purpose Commercial Invoice and L.C. Clauses Find out any mismatch between clauses and Invoice Sequentially arrange all files and Contact Issuance of Export Forms Certification of E Form L.C Confirmation Processing Doc. Negotiation Payment of Doc. Negotiation Processing of Doc. Collection Check whether the document are complete or not i.e. copy of NIC, permanent address etc. To fill incomplete forms and attached in a folder. Activity Checking Head Office Reconciliation State Bank Reconciliation How to approve a credit limit for a client

So that is all about my learning about the departmental functions of SNBL thokar niaz baig branch.

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SWOT ANALYSIS OF BANKING INDUSTRY

SWOT analyses take into account the strengths, weaknesses, opportunities and threats facing a business, organization or operation, in terms of serving customers, stakeholders and their own employees. A SWOT analysis of the banking industry will list these four components and illustrate for executives and management the areas the industry is performing well in not so well in. The SWOT also highlights the areas where there is opportunity to develop further and areas where there is potential to be hurt in the future. . STRENGTHS:

Pakistani banks have compared favorably on growth, asset quality and profitability with other regional banks over the last few years. The banking index has grown very fastly. Policy makers have made some notable changes in policy and regulation to help strengthen the sector. These changes include strengthening prudential norms, enhancing the payments system and integrating regulations between commercial and co-operative banks. Bank lending has been a significant driver of GDP growth and employment. Extensive reach: the vast networking & growing number of branches & ATMs. Pakistani banking system has reached even to the remote corners of the country. The government's regular policy has paid rich dividends with the nationalization of major private banks of Pakistan. In terms of quality of assets and capital adequacy, Pakistani banks are considered to have clean, strong and transparent balance sheets relative to other banks in comparable economies in its region.

WEAKNESSES:

PSBs need to fundamentally strengthen institutional skill levels especially in sales and marketing, service operations, risk management and the overall organizational performance ethic & strengthen human capital. Old private sector banks also have the need to fundamentally strengthen skill levels.

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The cost of intermediation remains high and bank penetration is limited to only a few customer segments and geographies. Structural weaknesses such as a fragmented industry structure, restrictions on capital availability and deployment, lack of institutional support infrastructure, restrictive labour laws, weak corporate governance and ineffective regulations beyond Scheduled Commercial Banks (SCBs), unless industry utilities and service bureaus.

OPPORTUNITIES:

The market is seeing discontinuous growth driven by new products and services that include opportunities in credit cards, consumer finance and wealth management on the retail side, and in fee-based income and investment banking on the wholesale banking side. These require new skills in sales & marketing, credit and operations. Banks will no longer enjoy windfall treasury gains that the decade-long secular decline in interest rates provided. This will expose the weaker banks. With increased interest in Pakistan, competition from foreign banks will only intensify. Given the demographic shifts resulting from changes in age profile and household income, consumers will increasingly demand enhanced institutional capabilities and service levels from banks. New private banks could reach the next level of their growth in the Pakistani banking sector by continuing to innovate and develop differentiated business models to profitably serve segments like the rural/low income and affluent/HNI segments; actively adopting acquisitions as a means to grow and reaching the next level of performance in their service platforms. Attracting, developing and retaining more leadership capacity

Foreign banks committed to making a play in Pakistan will need to adopt alternative approaches to win the race for the customer and build a value-creating customer franchise in advance of regulations potentially opening up . At the same time, they should stay in the game for potential acquisition opportunities as and when they appear in the near term. Maintaining a fundamentally long-term value-creation mindset. Reach in rural Pakistan for the private sector and foreign banks.

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With the growth in the Pakistani economy expected to be strong for quite some timeespecially in its services sector-the demand for banking services, especially retail banking, mortgages and investment services are expected to be strong.

THREATS:

Threat of stability of the system: failure of some weak banks has often threatened the stability of the system. Rise in inflation figures which would lead to increase in interest rates. Increase in the number of foreign players would pose a threat to the government as well as the private players.

SWOT ANALYSIS OF COMPANY

SWOT analysis is a process to identify where we are strong and where we are vulnerable, where we should defend and where we should attack. It tells us our strengths, our weaknesses, the opportunities which prevail in the market and the threats which we may face from our competitors and other from other potential factors. This analysis can be performed on a product, on a service, a company or even on an individual. Here we have applied this very useful technique to identify the strengths, weaknesses, opportunities and threats of Soneri Bank.

STRENGTHS Strong Financial Position

As we can see in the financial statements of the bank, the financial position of the organization is very sound and its profitability is in increasing. The Earning per share has been increased on a rate of about 50%, which is a very positive sign. Internship Report Page 70

Highly Qualified Employees

The bank has highly qualified and skilled workforce and it has succeeded to attract the best banking professionals from across the country due to its growing pace and sound reputation. Conducive Environment

The management of the bank is very much concerned with the development of and improvement of the working environment. The bank has state of the art and purpose built branches where all the modern technologies are provided to get the efficiency of the workforce and the customer satisfaction. Govt. Support and Encouragement

The govt. is fully supporting the bank management due to its policy to maximize the investment in the country, to get the economic prosperity. Fastest Growing Financial Institution

Due to its successful business policies and the strong financial position the bank has achieved the reputation of fastest growing financial institution in the country. It has greatly increased the customers confidence in the bank Huge Expansion Plan

Due to its strong financial position the bank has undergone a huge expansion plan to compete with the existing bank all over the country and with the passage of time the branch network is expanding at a very good pace. Young and Energetic Workforce

As the bank is a newer one in the country, the bank has an advantage over its competitors because the majority of its workforce is young and not very much over aged. Thus the bank is getting maximum output from its young and energetic workforce by spending comparatively less on their remunerations. Islamic Banking Division

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The bank is one of the pioneers of the commercial banks who have started the Islamic Banking along with their conventional banking. The bank has a separate network of its Islamic Banking Division which has 16 branches across the country and this network is also expanding at a very good pace.

WEAKNESSES Waiver of charges

Currently the middle management of SoneriBankis the big reason for waiver of charges. Bank losing a lot of its income likes (Cheque book charge, online charges, statement charges, and other things) because of management. This is a weakness of bank. Inexperienced workforce

As the majority of the workforce consists of young professional, they lack in their experience. And sometimes lack of experience becomes a hurdle while serving to the customers. It is the point

where they feel difficulty while competing the other bank, which have a very experienced workforce. Over work Load on Employees

It was observed in the branch that as compared to huge business the bank is dealing in, the no. of employees is lesser and thus there is an increased workload on the employees. Due to this the efficiency of the employees is reduced. Employees are not very much Motivated

As discussed before, the workload is high and the employees, especially the credit department, have to do late sittings to complete their tasks. On the other hand the bank has revised its salary increments policy to decrease the increment rate, as a result a decreased motivation level of employees is observed.

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OPPORTUNITIES Rapidly Growing Economy

At present the Pakistans Economy is growing on a very fast pace. The rapid growth of economy has resulted in the increase in the growth rate of all economic sectors especially in the banking sector which is growing at a fastest speed than ever and in future the growth is expected to increase even a higher rate. Increased Interest Rates

The SBP has revised the interest policy and the interest rates have been linked with the KIBOR rates. Due to which the banks interest rate has been substantially increased which will greatly increase the banks profitability. Mega Projects Financing

As the increase in overall business activity in the country, the investors are launching various types of Mega Projects especially in housing and textile the bank has a great opportunity to finance these projects at very profitable term. Huge Demand for Consumer Financing

The increase in per capita income and overall economy has resulted into a great demand for the consumer financing especially for home finance and car financing and it is said that this trend will increase more in future. The bank can earn a lot by focusing on its consumer financing sections.

Growing Trend of Islamic Banking

There is a very good growth trend in the Islamic banking in the country and in the world as well. Soneri Bank has the advantage of having fully fledged Islamic Banking network and the growth in this particular field can be very fruitful for the bank. Spending Practices of Mass

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As the Pakistanis are known for their extravagant practices, and to fulfill their funds requirements they dont hesitate from getting loans from banks. Thus there is a very good scope for the bank to run successful business in such circumstances.

THREATS Uncertainty of Economy

Although the economy is growing at a good pace, but there are many factors which results in the uncertain position of the economy. Such as political uncertainty, WTO, increase in poverty etc. etc. As a result there are permanent threats of future risks and losses for the bank. High Rate of Inflation

The inflation rate of the country has gone above the 10%. This can result into an unfavorable situation for the bank. Trend of Mergers

There is a trend of mergers among the banks to become prominent in the market and to get the maximum market share. This trend can result into the union of some leading banks which can give tough time to the bank and it will become difficult for the bank to compete with them. Privatization of Banks

Due to its privatization policy, the govt. is privatizing the state owned banks. The change in management may result in the increase in the efficiency and productivity of the banks. Thus it can become a threat for the bank. Risk of Defaults

As discussed earlier that there is a trend of launching mega projects in the country. And every one is involved in this trend without taking any measure for the successfulness of these projects. This can result into the failure of this project which can make it difficult for the banks to recover their funds from these defaulters.

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IDENTIFICATION OF PLAUSIBLE PROBLEMS

During my internship at this particular branch of SNBL, there are following problems I have found which are directly affect on efficiency and performance of the bank. There problems are also called as an internal problems. So these are discussing below.

SHORTAGE OF STAFF There is shortage of staff in the branch which is a problem for the management and customers as well. Because a single person is handling more than one departmental works as a result he/ she is unable to pay proper attention to a customer.

LACK OF PROPER PLANNING Bank should make a plan to gear up its recovery efforts on war footing and reorganize the recovery function of global bases. In addition, bank should tighten up control on expenditure. There is no any proper planning in this regard. So there should be proper planning for every work.

LACK OF ADOPTATION OF ADVERTISING Bank should launch advertising campaigns through out the year to promote the habits of savings in the people. Bank should open more branches in the remote areas of the country to get deposits and idle resources. Bank should provide similar facilities to all its branches in big cities. The standard of service and other facilities are far better as compared to smaller cities.

LACK OF PROPER GUIDANCE Bank should adopt such an induction plan that when a customer opens his account with the bank, he should be supplied with a booklet which enables him to know the procedure of filling the cheques and pay-in-slip etc. It will save a lot of time of the bank staff afterward during of the conduct of the account of that customer.

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LACK OF DIVION OF WORK The billing system of bank must be improved to facilitate the customers and workers. The work should be divided among the staff e.g. collection of bills, countering of cash and then entry of these.

RECOMMENDATIONS FOR THE COMPANY

It was an interested experience to do internship in Soneri Bank Limited. The staff was highly cooperated and due to their help I learned big deal about modern banking. I suggest that such an internship program highly integrative for the students of commerce education so that the students should be enquired with the knowledge of practice world .I do summarize that it would be a great help to me in selection of job or future field of work. Here I am putting some suggestions, which will enable the bank to compete with other banks more effectively & efficiently. It is observed that the employees were overburdened so they have to stay at branch till late at night. In this way their efficiency is affected and hiring more employees can reduce their work. The employees should be signed jobs for specific period and than they should shifted to other department so that they gain knowledge of other jobs. Bank should properly advertise and Communicate to public about the services provided by it, so that more customers will be attracted. The banks management should give more incentives and pay scale of officers should be revised & improved. Bank should give some more incentive to its employees in order to remove the conflict between lower and higher officers and should try to improve the working condition of the bank. A research cell should continuously try to gather information about the present action so its competitors and expected future actions. So in this way more effective strategies can be formulated. The performance reward linkage should be making strong as it is said, "A happy employee delivers more than he receives from the organization." The SNBL should also try to make its employees happier. Page 76

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There is immediate need, to reconstruct the personnel policies. Selection should be through newspaper advertisements. In this way more intelligent, efficient and qualified staff can be formulated. There is also a need of proper recruitment and selection program. New young talent should be introduced to inject the new ideas. Deterioration in efficiency is mostly due to promotion without merit. So promotions must be awarded on merit and also when due. Special attention should be given to the behavior of the employees towards the customers, as customer is the most important person for any bank. There are many employees who are working on ad-hoc basis creating dissatisfaction. The deserved should be made permanent employees. Political influences in the bank should be eliminated. System and operations should be more defined and organized. Branch manager should be trained in the field of selling to serve better according to the expectation of customers. The recruitment policy should be fair and transparent. IT draw backs should be improved. Administration drawbacks should be improved by the strict control of general issues. Audit should be held internally. Rather there should be an Audit Department in the branch to make audit on daily basis. This can become so helpful as different banks are having this department of their own. Expenditures must be control, which are very high.

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CONCLUSION
Soneri Bank is a good Organization in the way that anybody can join it for his/ her long-term career. Overall working environment is comfortable. Management of branch cares a lot of its employees and considers them as the Asset of bank. Behavior of senior executive of bank is very polite and they are caring about the individuals career and their growth. However management is very demanding about the targets but good reward at the achievement of assigned targets is awarded. Employees at Bank are quite efficient. Banks employees have to bring their bank among the list of good banks. Therefore, they work more than their working hours and it is all according to their will. It also shows their loyalty, commitment to organization. During my internship training I gathered information regarding how a successful bank operational aspect decorticated with the practical. I found my internship training at Soneri Bank Limited Thokar Niaz Baig Branch Lahore to be a very rewarding experience. The training was beneficial because it helpful me to aware a real life working environment. So far my learning is concerned; all the employees at branch were quite cooperative. They helped me to understand the activities of a bank to possible extent. Their good attitude gave me more confidence to learn more and to ask if I have any query in my mind. Besides their ever going activities they never get irritant by my questioning. I had made an honest efferent to present the working & operation of Soneri Bank Limited Thokar Niaz Baig Branch Lahore in simplest way. I feel pleasure that I have really gained a lot during 6 weeks & enjoyed working with experienced cooperative & intelligent staff.

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The first important thing is the discussions with the staff of the bank especially with the Operation manager of the branch. Moreover I use internet to collect secondary data by surfing the following websites and links. www.soneribank.com www.google.com

[Excerpted from Bureau of Labor Statistics, U.S. Department of Labor, Career Guide to Industries, 2008-09 Edition - Banking] SWOT Analysis of Banking Industry | eHow.com http://www.ehow.com/about_6700715_swotanalysis-banking-industry.html#ixzz1dqtnFoXN SWOT Analysis of Banking Industry | eHow.com http://www.ehow.com/about_6700715_swotanalysis-banking-industry.html#ixzz1dqtROUSB

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APPENDICES

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