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TABLE OF CONTENTS

Table of Contents.............................................................................................................................1

Executive Summary.........................................................................................................................8

Introduction......................................................................................................................................9

Evolution Of Bank...........................................................................................................................9

Formal Definition.............................................................................................................................9

COMMERCIAL BANKS..............................................................................................................10

COMMERCIAL BANKING SCENARIO IN PAKISTAN..........................................................10

ARMY WALFARE TRUST..........................................................................................................10

ASKARI BANK LIMITED...........................................................................................................13

Motivation of Askari Commercial Bank....................................................................................13

Business and Operations............................................................................................................14

Cooperate and Financial Institution Group............................................................................14

Consumer or Retail Banking Group......................................................................................17

Operation and Credit Group...................................................................................................18

Other Divisions......................................................................................................................19

HIERARCHY STRUCTURE.......................................................................................................21

Present Status of Askari Bank Limited..........................................................................................22

Comparison with Other Banks...................................................................................................23


Vision.............................................................................................................................................25

Mission...........................................................................................................................................25

Core values.....................................................................................................................................25

Corporate Objectives.....................................................................................................................25

Strategic Planning..........................................................................................................................26

Corporate Philosophy.....................................................................................................................26

Corporate Customers.....................................................................................................................27

Corporate Employees.....................................................................................................................27

Technology Oriented.....................................................................................................................27

Corporate Social Responsibilities .................................................................................................28

Sponsorships..............................................................................................................................28

Objectives and Mission Achievement.......................................................................................31

Business Principles....................................................................................................................31

Awards and Achievements ...........................................................................................................31

ORGANIZATIONAL CHART.....................................................................................................35

Board of Directors..........................................................................................................................35

Audit Committee ...........................................................................................................................36

Auditors .........................................................................................................................................36

Legal Advisors ..............................................................................................................................36


Registrar & Share Transfer Office ................................................................................................36

Registered Office /Head Office ....................................................................................................36

Head Office....................................................................................................................................36

Regions / Areas / Off-shore Branch...............................................................................................38

Departments..................................................................................................................................40

General Banking Department....................................................................................................40

Account Opening Department...............................................................................................40

Profit Calculation Methods....................................................................................................43

Account Opening Procedure......................................................................................................44

Individuals’ Account..............................................................................................................44

Joint Account ........................................................................................................................45

Proprietorship Account..........................................................................................................46

Partnership Account...............................................................................................................46

Limited Company Account....................................................................................................47

Minor Account.......................................................................................................................47

Trust/ Society/ Provident Funds.............................................................................................48

Other Responsibilities of Account Opening Department..........................................................48

Letter of Thanks ....................................................................................................................48

Stamping “Posting”................................................................................................................48
Cheque-Book Issuing ............................................................................................................49

Charges of Cheque Book Issuance........................................................................................49

Issuing procedure ..................................................................................................................49

Account closing ....................................................................................................................50

Everyday posting ..................................................................................................................50

Procedure of Opening Other Accounts......................................................................................51

Askari Bachat certificate .......................................................................................................51

Notice deposit .......................................................................................................................51

Term deposit..........................................................................................................................52

Cash Department........................................................................................................................52

Cheque ..................................................................................................................................52

The Request of a Cheque.......................................................................................................52

Types of Cheques...................................................................................................................52

Cash Deposit Procedure.........................................................................................................53

Cash Payment Procedure.......................................................................................................53

Calculation of Ending Cash Balance.....................................................................................54

Cash Management..................................................................................................................54

Liquidity Maintenance...........................................................................................................55

Clearing Department..................................................................................................................56
OBC ......................................................................................................................................56

Local Clearing........................................................................................................................59

Procedure of Inwards.............................................................................................................61

Procedure of Outwards Clearing............................................................................................62

Same Day Clearing................................................................................................................63

SBP Accountant and Clearing ..............................................................................................63

Clearing Position Statement ..................................................................................................63

Remittances Department............................................................................................................65

Instruments of Bills and Remittance Department..................................................................65

Issuance Procedure.................................................................................................................65

Issuance Procedure.................................................................................................................66

Issuance..................................................................................................................................67

Issuance Procedure.................................................................................................................68

Online Funds Transfer...............................................................................................................70

Lockers...................................................................................................................................70

ATM Card..............................................................................................................................70

Credit Cards Department...........................................................................................................74

Credit Department..................................................................................................................75

Types of Advances.................................................................................................................84
Foreign Exchange Department .................................................................................................88

Export Section .......................................................................................................................95

Accounts Department...............................................................................................................102

Function of Accounts Department.......................................................................................102

Product and Services....................................................................................................................108

Deposits....................................................................................................................................108

Products ...................................................................................................................................109

Smart Cash...........................................................................................................................109

Personal Finance..................................................................................................................110

Mortgage Finance................................................................................................................111

Business Finance..................................................................................................................112

ASKCARD..........................................................................................................................113

Askari Rupee Traveler Cheques..........................................................................................114

Investment Certificates........................................................................................................114

Askari Value Plus Deposits.................................................................................................115

AskPower.............................................................................................................................116

Askari MasterCard...............................................................................................................116

Cash Management Services.................................................................................................118

Internet Banking Services....................................................................................................118


Askari Mahana Bachat Account (1 + 3 Years Term)..........................................................119

Askari Deposit Multiplier Account......................................................................................119

Electronic Bill Payment Services.........................................................................................120

Askari Roshan Mustaqbil Deposit.......................................................................................120

Agriculture Finance Solutions.............................................................................................121

Askari Kissan Agriculture Finance Program.......................................................................121

Islamic Banking Services ............................................................................................................125

Branch Network.......................................................................................................................126

SOUTH REGION................................................................................................................128

CENTRAL REGION...........................................................................................................128

NORTH REGION................................................................................................................128

Wholesale Bank Branch is 1 in Bahrain ............................................................................128


Executive Summary
Introduction
A well-developed monetary sector is pre-requisite for the development of any country. The
banking system can contribute greatly to the realization of a nation’s potentialities for
development by helping to keep aggregate demand in proper balance with the supply of those
resources, which are responsive to monetary demand.

Evolution Of Bank
Different opinions exist about the origin of the ‘Bank’. According to some authorities the
word “Bank” itself derived from the words “Bancus” or “Banque”, that is a bench. The early
bankers, the Jews in Lombrady, transacted their business of money exchange on benches in the
market place. When the business failed the “Banco” was broken by the people; and the word
“Bankrupt” has evolved from this practice. This etymology is however ridiculed by Macleod on
ground that “the Italian money changers as such were never called Banchieri in the Middle Ages.
There are the others who are of the opinion that word “Bank” is originally derived from the
German word “Back” meaning a joint stock fund, which was italianised into “Banco” when the
German the greater part of the Italy.
Banks are financial intermediaries. By endowing its obligations with attractive features, an
intermediary sells its obligations at a higher price than it has to pay for the obligations it buys.
The spread between the interest rate it pays on its own obligations of others constitutes the
margin from which the other expenses of doing business must be deducted. The next profit after
these deductions represents the return to the shareholders for their participation in the activity of
financial intermediary.

Formal Definition
“Bank is an institution transacting the business of accepting for the purpose of money from
public, repayable on demand or otherwise and withdrawal by cheque, draft, and order and
includes any post office saving bank.”
These are the following types of banks

• Central Bank

• Commercial Bank

• Industrial Bank
• Exchange Bank

• Saving Bank

• Mortgage Bank

COMMERCIAL BANKS
Commercial banks are companies “which transact business of banking in Pakistan Commercial
Banks have constituted the most important source of institutional credit in the economy of
Pakistan.

COMMERCIAL BANKING SCENARIO IN


PAKISTAN
At the time of independence in 1947, there were 38 scheduled banks with 195 offices in
“Pakistan”. But by December 31, 1973 there were 14 scheduled Pakistani Commercial Banks
with 3,233 offices all over Pakistan and 74 offices in the foreign countries.
Nationalization of Banks was not done 1st January 1974 under the Nationalization Act 1974 due
to certain objectives. But it had negative effects on the efficiency of the banking sector.
Afterwards, a Privatization Commission was set up on January 22, 1991during the first tenure of
the Prime Minister Muhammad Nawaz Sharif. The commission transferred many banks to the
private sector, i.e., MCB and ABL. The government approved and permitted the establishment of
10 new private banks in August 1991. Hence many new private banks have incorporated since
then. Askari Commercial Banks is one of the namely established private scheduled banks. It is a
branch of Army Welfare organization (AWT).

ARMY WALFARE TRUST


• Army welfare trust was established mainly for the welfare of army officials.

• The office of army welfare trust is situated at AWT PLAZA Rawalpindi.

• AWT offers the “AWT Saving Scheme” to the army officials only.

• AWT has further as units.

o Listed Companies

 Askari Bank Limited

 Askari Leasing Limited


 Askari General Insurance Company Limited

o Other Companies

 Askari Cement Limited

 Askari Aviation (Pvt.) Limited

 MAL Pakistan Limited

 Askari Guards (Pvt.) Limited

o Askari Projects

 Askari Sugar Mills

 Askari Farms and Seeds

 Askari CNG

 Askari Shoe Project

 Askari Woolen Mills

 Askari Real Estate


ASKARI BANK LIMITED
Askari Bank was incorporated in Pakistan on October 9, 1991, as a public limited company. It
commenced operations on April 1, 1992, and is principally engaged in the business of banking,
as defined in the Banking Companies Ordinance, 1962. The Bank is listed on Karachi, Lahore
and Islamabad Stock Exchanges. Askari Bank has expanded into a network of 204 branches / sub
branches, including 18 dedicated Islamic banking branches, 15 sub branches and a wholesale
bank branch in Bahrain. A shared network of 2,991 online ATMs covering all major cities in
Pakistan supports the delivery channels for customer service. As at March 31, 2009, the Bank
had equity of Rs. 13.620 billion and total assets of Rs. 206.19 billion, with 816,629 banking
customers, serviced by our 6,496 employees. Askari Investment Management Limited and
Askari Securities Limited are subsidiaries of Askari Bank engaged in managing mutual funds
and shares brokerage, respectively.
From the inception it has achieved and sustained an increasing trend of profitability and growth
by focusing on the basic essentials of banking. The Head Office of Askari Commercial Bank,
Limited is at AWT Rawalpindi. The Head Office leads and supervises all the branches scattered
in the far off areas. The departmentalization of head office has been done on the basis of
functions. In order to perform various functions there are eight divisions of the Head Office.

Motivation of Askari Commercial Bank


While successfully penetrating the key domestic markets through strategic expansion and
business diversification they remain alive to the challenge emanating from the development in
the global financial market; the opportunities and threats engendered by greater deregulation and
increased customer expectation. These provide them the impetus to make the best use of
available resources including modern technologies, to meet the challenges ahead.
Historically, Askari core marketing focus for its asset base has been the operating in the large
urban centers of Pakistan, which are primarily oriented towards foreign trade. This segment
constitutes significant revenues to the bank. The liability side remains focus on the middle and
upper middle class retired and serving government and armed personnel and mid size business
house along with some big companies like NFML, Hi-Tech, Shahzore etc.
Their corporate banking division was establish on April 1999 primary focus on servicing large
cooperate and multinational companies. Benefiting from the banks’ growing balance sheet size,
this division B now gaining momentum and their long term aims to develop it into independent.
Strategic Business Units (SBUs’) … this would the bank to acquire, develop and specialized
abilities, and enhance their focus on serving the emerging need of cooperate clients.
With the branches network of 204 and further expanding in the future, the ATM facilities and
online banking. Askari banks’ reach is ever increasing. In the recognition of this reach, they have
setup a retail banking group in July 2000.the Mobile ATMs’ facility is introduced by the Askari
bank for the first time in 2005.dedicating to serving the urban consumer market. Askari is
committed to aggressively market this segment. The strategy is to provide their customers with
the basket of innovation products to meet their verifying needs.
Askari bank is the only private bank in the region that has been approved by the World Bank as a
Participating Financial Institution for the US$ 200 million Line of Credit Sanction to the
government of the Pakistan for the financial sector Deepening and Intermediation Project.
Askari emphasis on further broadening its core foreign trade business translated into handling a
higher volume of Export and Import Business. This enhance foreign trade business was secured
due to the excellent customer services and excellent international settlement arrangement with
the corresponding international banks. Askari bank is operating throughout the Pakistan. Most of
branches are connected through our State of Art, Online Communication Network, which gives
the bank a competitive edge in providing instant services to its clients. It also access to the latest
foreign exchange rates through online communication.

Business and Operations


There are three basic groups of works Askari deal in:
1. Cooperate and Financial Group
2. Consumer Or Retail Banking
3. Operation And Credit Group

Cooperate and Financial Institution Group


Corporate & Investment Banking Group (CIBG) provides financial services to the Bank’s large
corporate and institutional customers, including public sector entities. These include products for
meeting operational funding requirements, as well as a suite of structured finance solutions
relating to strategic expansions, divestments, syndications, project finance, underwriting, cash
management, and trade related services. The Group operates through a Corporate Banking
Division (CBD) and an Investment Banking Division (IBD) based upon a client centric and
distribution-focused business model, supported by a culture that prioritizes relationships and
economic returns through a structure that enables an integrated, multiproduct service offering.
The combination of CIBG’s industry expertise, strong balance sheet and innovative product
structuring allow us to meet the evolving needs of our ever-growing client base. Our Corporate
and Investment Banking teams work hand in hand to identify and deliver through a combination
of basic and structured product offerings including but not limited.
i. Corporate and Merchant Banking Division
ii. Investment Banking Division
iii. International Division
iv. Treasury Division

Corporate and Merchant Banking Division


Corporate Banking Division (CBD) works on a long-term relationship based business model to
provide a single point within the Bank for meeting all business requirements of large size
customers, with the primary objective of enhancing customer service, whilst improving quality
of portfolio. As planned, all CBD relationships were centralized from various branches into three
corporate centers/regions in Karachi, Lahore and Islamabad. In addition, dedicated corporate
branches have been established in the South and Central regions to enhance service and
monitoring, by providing a closer liaison between the branch/distribution point and the
relationship managers/clients point-of-contact, thereby improving the overall response time for
servicing customers’ financial needs, as well as enhancing the depth of business relationships.
CBD, in conjunction with the Investment Banking Division and Treasury Divisions showed
strong growth in income from effective cross selling, bundling of products using knowledge and
experience in targeted sectors.
Given the recessionary trends CBD activities centered on consolidation and effective
management of portfolio, while achieving targeted growth in the Power, Energy, Fertilizer and
Cement sectors that are most critical to the domestic economy. Active risk management
techniques were also implemented under Basel II guidelines through development and
cultivation of relationships with externally rated entities/ corporations thus enabling the Bank to
maximize risk adjusted returns on capital deployed through CBD.
Investment Banking Division (IBD)
Investment Banking Division (IBD) provides a full range of financial advisory and capital
raising services to corporate and institutional clients. With special emphasis on the ability to
initiate and execute complex transactions, IBD team provides innovative solutions based on our
clients’ requirements. IBD also actively manages the Bank’s proprietary investments in the
equity and debt markets through:
• Strategic equity investment in group and listed companies in primary and secondary market
offerings and building and management of the Bank’s corporate bond book with the objective of
maximizing return on capital while closely monitoring business and credit risk;
• Investments and divestments in various equity and money-market mutual funds in line with the
Bank’s overall risk appetite and changing economic and interest rate outlook;
• Supporting the local equity market by offering and managing various financing products
including the Continuous Funding System.
2008 was a prolific year for the IBD team, which was involved in the arrangement and
structuring of a number of high profile debt arrangement and project finance transactions.

Treasury Division
Treasury division prudently managed the liquidity and enabled the Bank to operate competitively
despite severe liquidity crisis. In addition, treasury operations increased turnover with a view to
developing a more comprehensive trade/treasury book due to increase in branch network and
effective utilization of corporate desk, established at the treasury. Furthermore, treasury
operations are structured in such way to measure, mitigate and manage the risks associated with
its activities. The efficiency and effectiveness of treasury operation are being enhanced by
relevant and appropriate training of the human resource available with the treasury and updating
of its system software to meet the new challenges and be more competitive in the market.

International Division
International Division primarily manages correspondent banking arrangements to facilitate
banking for our customers’ trade finance businesses. During the year, while maintaining focus on
the core trade finance business, the Division made concerted efforts to rationalize nostro
accounts and enhance the volume of workers’ inward remittances. Presently, Askari Bank enjoys
multi-faceted correspondent banking arrangements with229 banks at over 800 locations around
the globe. Effective management and optimum utilization of business reciprocity with
correspondent banks enables us to manage the returns and trade business flows.

Consumer or Retail Banking Group


Retail Banking Group was formed in 2000; this group is responsible for serving the needs of
retail market. Focusing of divisional consumers and SME, for the purpose of product
differentiation, the group is managed in three business arms:

• Investment Product Unit

• Assets Products Unit

• Credit Card Division

Investment Product Unit


Responsible for developing and managing brands which serve the investment needs of the
consumer market, this unit is focusing on deposit mobilization, provision of value added services
based on the modern technologies and undertaking the centralize marketing and advertising for
the bank. This unit also actively involved in the acquisition business.
Askari Banks’ Value Plus is a unique deposit account, which offers handsome monthly profits,
accidental insurance cover, partial liquidity on all time deposits and free privilege Card
membership. The unit is also administrating the sales and distribution, including arrangements
for strategic partnership alliances for Askari-i-Net Banking, the first internet banking in Pakistan,
which allows routine banking transactions from anywhere in the world, round the clock, over the
internet.

Asset Product Unit


This unit is engage in the development and management of the retail credit scheme. The
consumer market in Pakistan has not only grows exponentially over the last decade or so, but the
needs of this segment have become extremely diverse. In order to sustain competition, it is
imperative to continue offering innovative consumer credit scheme. With the launch of Askari
Personal Finance and Askar (Auto loans), this unit is emerging as a significant contributor to the
Banks’ loan growth. The unit also administers the first ecommerce banking solution in Pakistan,
under the brand name ASK-IBL online. This is B2B automated credit transaction module,
offering merchandise credit to retailers a goods purchase from one of the largest distributor in the
country. Strong collection and prudent risk management policies have restricted delinquencies to
very low level.

Credit Card Division


This division manage Askari Master Card brand and it’s headquarter is in Karachi. With a fully
new automated transaction processing system, the brand was re-launched in 200, supporting by
an aggressive advertising campaign and strong sales team network. The credit division
supervises the credit department of different branches. It sanctions the various credit advises sent
to it by different branches and monitors the loans.

Operation and Credit Group


It is a supporting function group mainly responsible for developing systems and procedures,
process re-engineering, automation and credit management. The group is organized in three
divisions:

• System and operation Division

• Electronic technology Division

• Credit division

System and operation Division


This group has been instrumental in development of procedures and manuals for various
operating requirements of the bank. After carefully mapping of the existing process flows, the
division recommends automation and re-engineering requirements. To improve transaction
efficiency the division is active in providing equipment procurement support and development of
new branches. The protection of the fixed assets of the bank is also managed by this division, as
directs functions. During the year 2001 the division ha purposed several cost cutting initiatives
based upon improvement of our existing procedures and documentation reduction. This division
successfully implements the model branch concept in 2001, which have been proved to be a mile
stone towards improving our customer service standards and achieving process uniformity with
optimum resource utilization.

Electronic technology Division


This division operates as the backbone for all operational functions in the bank. Responsible
primarily for the development of the banking software and provision of computer hardware to all
business units, the division also engaged in technology based value added customer services
products. The division helped the bank in playing the pioneering role in offering internet banking
service e-commerce solution and online banking. The division online real time branch
connectivity and has full automated transaction processing support programmers in the place.
The division is focusing on use of data-warehousing technology to enhance the relationship
management program of the bank.

Credit Division
Providing extensive support to branches for credit administration, control and monitoring, the
division has played a pivotal role in helping the bank achieve a remarkable loan. Most of the
loans are of short term trade financing on a secure and self-liquidating basis. The division has a
special asset management team, which s responsible for ensuring lower ratio of bad debts,
effective monitoring of delinquent advances and close fallow up of recoveries. Banks’ head
office credit committee reviews the credit quality and pricing on regular basis not only to ensure
healthy credit growth but also the management banks’ risk assets in almost prudent and
profitable manner.

Other Divisions
Some other divisions are:
A. President Secretariat
The president supervises all the working of the branches. He holds meeting with the branch
managers and make the policies in the coordination with Board of Directors.
B. Audit Division
The head of this department is called Audit Chief. This division audits the various branches and
certifies that their working is flawless. The audit reports directly to the board through the
executive committee which is also the audit committee. The audit division is completely
independent of the management and is responsible for checking and reporting on the
management compliances with the board policies and directives, as also the prudential
regulations and other directives of the SBP. However their role is not intended to just of fault
finding; but also guiding and assisting the branches in improving their operations.
This division in responsible for evaluating every aspect of the banks’ operation with the goal of
improving the effectiveness of the risk management and internal control. There is also a regional
audit office is attached to each area office; the nature of this business is of more quality
assurance rather than strictly audit. The regional auditor report to area manager, and assist them
in ensuring that there is proper compliance with all the relative directives, and also that consumer
service standards are maintained and improve, at the branches in the area.
A. Corporate and Planning Division
This division is responsible for the corporate affairs and the various planning schemes of Askari
Commercial Bank, Limited.
B. Finance Division
The financial division permeates into the aspects of the banks. It makes the financial statement
and look after monetary affairs of the bank. Responsible for bookkeeping and accounts, this
division at head office, prepare all financial retune and the MIS through its management
repotting wing. The division is actively involved in preparing market cooperative analysis,
consolidation of banks’ budgets; its monitoring and constant review various financial indicators.
The division directly report to the president and the chief executive of the bank has been
instrumental in the preparation of banks’ business plans and future strategies.
C. Business Development Division
This deals in marketing aspects, promotional and other areas of the business development like
expansion and enhancement.
D. Human Resources Division
The human resources division manages the personnel affairs and administers the personnel
policies. HR division is also responsible for the recruitment and promotion of the employees.
This division suggests the pays of the employees and allocates other funs and bonuses to the
employees. It also takes into account the daily leaves of the employees and the other monthly
and annual leaves.
E. Law Department
This is the department that coordination all the divisions. All the divisions are bridged together
through this department.
HIERARCHY STRUCTURE
PRESIDENT

SENIOR EXECTIVE VICE PRESIDENT

EXCUTIVE VICE PRESIDENT

SENIOR VICE PRESIDENT


BRANCH HIERARCHY

VICE PRESIDENT

ASSISTANT VICE PRESIDENT

OFFICER GRADE I

OFFICER GRADE 2

OFFICER GRADE 3

JUNIOR OFFICER

PABX OPERATOR

DRIVER

PEON
Present Status of Askari Bank Limited
Askari Commercial Bank was incorporated in 1992 but its performance was much better than
other small banks like Prime Bank, Mybank, etc., mainly because the bank has strong backing.
However, its performance promoted the bank as medium-sized bank with strong balance sheet.
The paid-up capital of Askari Bank for 2008 was just Rs4.059 billion and it improved to Rs5.07
billion by March 31, 2009. The State Bank’s revised target of paid-up capital for commercial
banks is Rs6 billion till end December 2009
The equity of Askari Bank in March 31st 2009 is 13.620 billion in 2008 was R12.971 billion,
advances Rs128.818 billion which was 100.780 billion in 2007, deposits Rs167.677 billion. The
bank was operating with 203 branches across the country with 18 Islamic Branches and 1 whole
sale branch in the Kingdom of Bahrain. The bank earned a profit after tax of Rs317 million in the
first quarter of 2009.
All of these facts show how effectively and efficiently Askari Bank works.

Revenues 17%
over last year

Operating Profit 10%


over last year Total Assets 13%
over last year

Askari Bank has expanded into a network of 200 branches / sub branches, including 20 dedicated
Advances 28%
Islamic banking branches, and a wholesale bank branch in Bahrain. A shared network of 2,991
Deposits 17% over last year
online ATMs covering all major cities in Pakistan supports the delivery channels for customer
over last year
service. As at December 31, 2008 it has 816,629 banking customers, serviced by our 6,496
employees.
Askari Investment Management Limited and Askari Securities Limited are subsidiaries of Askari
Bank engaged in managing mutual funds and shares brokerage, respectively.
All this show that due to the crises in economy Askari Bank Still working well as compare to the
other commercial banks in Pakistan. All this is due to the strong policy making and strategy
formulation of the management of the Askari Bank.
Now Askari Commercial Bank has announced its intention to acquire ‘Mybank’ once it gets
permission for due diligence from the State Bank of Pakistan.
The announcement did not create stir in the banking sector as it was viewed as a part of current
consolidation phase in the financial sector.
The Board of Directors of Askari Bank in its meeting held here on Tuesday, 23 June authorized
the management to sign a memorandum of understanding (MOU) for the merger and
amalgamation of Mybank Ltd into Askari Bank.
Mybank was incorporated in 1992 as commercial bank and is currently operating with 73
branches across the country. The recent global financial crisis that hit most of banking giants in
the developed economies also affected Pakistani banking sector especially small banks. The
State Bank has also been promoting mergers and acquisitions of small banks with the view that
large banks are less risky and stronger for a financial system. According to latest available
information, the paid-up capital of Mybank is Rs4.243 billion, equity Rs5.148 billion and the
total assets amounted to Rs41.344 billion.
The recently issued 3rd quarterly report of the State Bank showed that the bank’s profitability
was on decline while the small banks were facing more difficulty. The most shocking is failure
of all banks to improve on their deposit base that forms the bedrock for a bank to operate and
grow. In the outgoing fiscal year, banks could not raise deposits which certainly put more
pressure on small banks.
“If the recovery of the financial system begins next year as predicted by many economists,
the merger will benefit the Askari Bank” said an analyst.

Comparison with Other Banks


If we compare Askari Bank with the Bank Alfalah, MCB Bank and other banks of Pakistan they
was in cooperated many years ago than Askari Bank and they are little better than Askari in their
deposits, income, assets, etc. But if we compare the performance of it with the Banks
incorporated in 1992 like Al-Habib Bank ltd., Metropolitan Bank, K.A.S.B Bank, Prime
Commercial Bank, etc its performance is appreciable.
Here we give some facts in the comparison of Askari with other Banks. These facts are taken
from annual reports 2008 of each bank.

Banks Earnings Per Share Total Assets Income after tax Share Capital
(In Rs.) (In Millions) (In Millions) (In Millions)
Askari Bank 0.95 206,191 386.225 4,058
Bank Alfalah 1.63 348,990 493.419 7,995
United Bank Ltd. 8.24 605,073 8,333 10,117
Mybank 0.79 3,9803 5,303.58 4,243
Al-Habib Bank 4.95 177,330 2,367 4,785
If we compare Askari Bank with bank incorporated in the same year as in Askari its performance
is better and its financial condition is better than those banks. If we compare it with banks
incorporated many years before than Askari then we see that they have much better condition. If
we see the growth of Askari Bank we see that it will be in the list of commercial banks in
Pakistan. Bank is growing with the high speed in little time in year 2008 its earning is less as
compare to the previous years it is due to the increase in expenses but not due to the earning.
If we see the customer loyalty we see that it’s less in Askari as in other banks. And the job
satisfaction is less in Askari than other banks. It has to change their strategies regarding the
customers and employees. Its current condition is comparable with the other good banks in
Pakistan and more respectable. It is technology oriented Askari use latest technology and IT
system in the banking. But it has less IT professionals, if we see in it; it has lot of ATM
complaints and online problems.
Vision
To be the bank of first choice in the region

Mission
To be the leading private sector bank in Pakistan with an international presence, delivering
quality service through innovative technology and effective human resource management in a
modern and progressive organizational culture of meritocracy, maintaining high ethical and
professional standards, while providing enhanced value to all our stakeholders, and contributing
to society.

Core values
Integrity is the most valued standard in whatever we do. We understand that our commitment to
satisfy customers’ needs must be fulfilled within a professional and ethical framework. We
subscribe to a culture of high ethical standards, based on the development of right attitudes. The
intrinsic values, which are the corner stones of our corporate behavior, are:

• Commitment

• Integrity

• Fairness

• Teamwork

• Service

Corporate Objectives
Askari bank is looking ahead by moving through the number of years and its efforts are guided
by the broad set of objective that are:

• To achieve sustained growth and profitability in all areas of business.

• To build and sustain a high performance culture, with a continuous improvement focus.

• To develop a customer–service oriented culture with special emphasis on customer care


and convenience.

• To build an enabling environment, where employees are motivated to contribute to their


full potential.

• To effectively manage and mitigate all kinds of risks inherent in the banking business.
• To maximize use of technology to ensure cost–effective operations, efficient
management information system, enhanced delivery capability and high service
standards.

• To manage the Bank’s portfolio of businesses to achieve strong and sustainable


shareholder returns and to continuously build shareholder value.

• To deliver timely solutions that best meets the customers’ financial needs.

• To explore new avenues for growth and profitability.

Strategic Planning
• To comprehensively plan for the future to ensure sustained growth and profitability.

• To facilitate alignment of the Vision, Mission, Corporate Objectives and with the
business goals and objectives.

• To provide strategic initiatives and solutions for projects, products, policies and
procedures.

• To provide strategic solutions to mitigate weak areas and to counter threats to profits.

• To identify strategic initiatives and opportunities for profit.

• To create and leverage strategic assets and capabilities for competitive advantage.

Corporate Philosophy
from knowing Askari customers’ requirements to understand employees need, from utilizing
modern technology to making responsible social contribution, from enhancing stake holders’
value to participating corporate ethics. Askari is continuously striving to address newer
challenges with single motivation “The power to inspire and be inspired”. Organizational goal
and strategy define the purpose and competitive techniques that set it apart from other
organizations. Goals are often written down as an enduring statement of company intent.
A strategy is plan of action that describes the resource allocation and activities for dealing with
environment and for reach the organizational goal. Goals and strategies define the scope of
operations and the relationship with employees, clients and competitors. With the experience of
foreign trade and an extensive international branch network, Askari commercial bank is
committed to help the customer succeed in every competitive environment. to keep pace with
changing needs Askari bank constantly review its comprehensive cash, trade and treasury
products and services, ensuring that a full range of flexible and innovation services are always
available for the customers wherever they trade.

Corporate Customers
Knowing our customers and their needs is the key to our business success. Our products and
services are as diverse as our market segments. Our client relationship managers are well
equipped and well trained to provide the most efficient and personalized service to the
customers. Askari Bank is proud of its pioneering role in providing the most modern and
technologically advanced services to its 816,629 relationships.

Corporate Employees
We strongly believe that the interests of the Bank and the employees are inseparable. At Askari
we try to create a ‘we’ culture where there is mutual trust and respect for each other. We
encourage ownership behavior so that everyone feels responsible for the performance and
reputation of the Bank. We are committed to develop and enhance each employee’s skills and
capabilities through extensive in–house and external training programs and job rotations.

Technology Oriented
Our strength in the area of information technology (IT) based services have always been an edge
in the competition and have been a source of considerable strength in the expansion and
management of the customer base of the Bank. In line with our policy of providing the most
modern and convenient banking services, Askari Bank acquired Oracle Financial Software
System (OFSS) (previously I-flex)in 2007, along with other support software including Oracle
Financial (finance and MIS software), PeopleSoft (human resource management software),
Revele us (risk management software) and Siebel (customer relationship management
software).Implementation of these software is a colossal task which commenced during
2008,after detailed planning process involving all business and operational units. Also, to
achieve smooth transformation to the new software, dedicated teams have been formed in
execution and advisory capacities, comprising of senior management. These teams are diligently
working to complete the task within the shortest possible time. Given the scope and implications,
this project is assigned the highest priority and commitment at all levels.
Corporate Social Responsibilities
Askari Bank strongly believes that the success of an entity is directly connected with the well
being of a society in which it operates as business could not exist or prosper in isolation. It is
thus giving something back to the society in recognition of the benefits and advantages drawn
from it. Therefore it is our belief that it’s a privilege, not a right, which the Bank ought to pay
back as a responsible corporate citizen.
The business ethics of the Bank are built on the philosophy of care of both the customers and the
society, of which we are all part of. Our core values for doing business circle round the five
pillars of commitment, integrity, fairness, teamwork and service towards our customers,
employees and communities.
We believe in encouraging sports at every level as nurturing the physical spirit gives rise to
healthy, spiritual and moral values. During 2008,
Askari Bank sponsored various sporting events to promote healthy activities, which include
Badminton, Swimming, Squash, Tennis, Golf, Polo, Volleyball, Shooting and Squash across the
country. During the year, Askari Bank has contributed to charities and community projects, not
only to bring about a better quality of life to the less privileged in the community, but also to
enrich the lives of Pakistani citizens. Major contributions to the society include the financing for
development of parks, roundabouts, gymnasiums, industrial exhibitions, fundraisers and tourism
festivals. Health issues have been a particular concern to us. During 2008, Askari Bank
sponsored various programs related to health. As a caring corporate citizen, Askari Bank has also
been actively making regular donations to charitable institutions working for social welfare.
Askari Bank, in its quest for the equal rights and empowerment of women, continued to support
Non Governmental Organizations (NGOs), which are working on issues related to the welfare of
women.

Sponsorships
Askari Bank has demonstrated a leading role in supporting a large number of important activities
and significant events. Major activities during 2008 were:

Sports
• Sponsorship of 4th TCF Golf Tournament2008

• Sponsorship of All Pakistan Multan Open Golf Championship 2008


• Sponsorship of Badminton Championship, organized by NUST

• Sponsorship of 9th FINA World Swimming Championships held at Manchester, UK,


2008

• Sponsorship of Askari Bank Polo Team representing Askari Bank in the Pakistan Cup
and Punjab Polo Cup 2008

• Sponsorship of 6th Chief of the Army Staff International Squash Championship 2008.
(March 31 to April 5th, 2008)

• Sponsorship of Army Polo Cup and Show Jumping Championship 2008 (April 7 to 12,
2008)

• Sponsorship of President of Pakistan Polo Trophy 2008

• Sponsorship of the President Cup Golf Championship 2008 held on April 25-27, 2008

• Sponsorship of Golf & Polo matches organized by 106 Air Defence & Officer 29 Cavalry
Kharian Cantt

• Sponsorship of ITF Pakistan International Junior U-18 (Boys & Girls) Aug 11-30, 2008
Islamabad

• Sponsorship of Pakistan Army Hockey Team for Donghae Mayor Cup 2008, South
Korea

• Sponsorship of COAS Open Golf Championship 2008 at Rawalpindi Golf Club

• Sponsorship of Punjab Open Golf Tournament 2008 played at Rawalpindi Golf Club

• Sponsorship of Medium to High Goal Polo Tournament 2008

• Sponsorship of 4th South Asian Shooting Championships 2008 at Gun Club Islamabad

• Sponsorship of Punjab Open Squash Championship 2008 held in Lahore

Social
• Sponsorship of Special Program for Mentally ill Patients organized by The Agha Khan
University Hospital, Karachi

• Sponsorship of SBP Agricultural Workshop held at Lahore

• Sponsorship of Askari Rawal Festival 2008, organized by Trance Media


Communications
• Sponsorship of NUST’s SEECS Festival 2008

• Sponsorship of Musical Function 2008 organized by DHA Creek Club

• Sponsorship of 1st International Conference on Psycho trauma, Islamabad

• Sponsorship of Fundraising Program for development work in Katchi Abadies of Karachi

• Sponsorship of Puppet Show held on August 30, 2008 at DHA Islamabad

• Sponsorship of Horticulture Drive in Lahore

• Sponsorship of Foliage Exhibition organized by Flora Care, Lahore

• Sponsorship of “Black Pearl” on opening of Chamalang Coal Mines” An International


Film Festival held in Rome

• Sponsorship of SBP Agri Seminar / Mela in Hyderabad

• Sponsorship of a Commercial Theatre Play at PNCA, Islamabad

Education
• Sponsorship of 1st International Conference on Business and Technology” at Margalla
Hotel, Islamabad

• Sponsorship of annual program of CFA Association of Pakistan for 2008-09

• Sponsorship of three days exhibition i.e. “Mega Industrial & Trade Fair” at Convention
Centre Islamabad

• Sponsorship for 3rd South Asian Capital Markets Conference 2008 held in Mumbai,
India

• Sponsorship of Annual Sports Festival 2008 arranged by Multan Public School &
College, Multan

• Sponsorship of ICMAP Convocation 2008 at PC Karachi on Dec 14, 2008

Environment
• Sponsorship of special campaign “Telephone a Tree”, Lahore

• Sponsorship of 150 annual spring flower show, Bara Dari, Bagh-e-Jinnah, Lahore 2008

• Development of fountain at F-10 Roundabout, Islamabad


Objectives and Mission Achievement
These above mentioned objective and mission will be achieved through

• Focused objectives

• Winning as a team

• Excellence in delivery

• Relentless quality

• Upward rising Sales

Business Principles
Askari code of business is to;

• Deliver solutions that meet customers’ diverse needs.

• Build and sustain a high performing culture.

• Build trusted relationships with all share holders.

• Build and manage the Banks’ portfolio of businesses to achieve strong and sustainable
shareholder returns.

• Create and leverage strategic assets and capabilities for competitive advantages.

Awards and Achievements


In 1994, 1996 and 1997 the bank received Euro money and Asia money awards. Askari has A1+
for the short term obligations the highest possible for the category, while the long term rating
stands at AA. Askari Bank won the prestigious “Best Presented Annual Accounts” awards for
2000 and 2001fromthe Institute of Cost and Management Accountants of Pakistan (ICMAP) for
the service sector.
Mr.Kalim-ur-Rahman, the President Askari Bank with group having award of “The Best Retail
Bank of Pakistan 2004”. For the past four years, the bank has received prizes from the South
Asian Federalism of Accountants (SAFA) “The Best Presented Annual Accounts” for the
financial sector, in the SAARC region.
Over the years, Askari Bank has proved its strength as a leading banking sector entity, by
achieving the following first prizes in Pakistan.
• First Pakistani Bank to offer online real time banking on a countrywide basis.

• First bank with a nationwide ATM network.

• First bank to offer Internet Banking Services.

• First Bank to offer e-commerce solution.

The Askari Bank has been declared “The Best Bank in Pakistan" by the Global Finance an
international financial magazine of high reputes a result of their latest study of Banks in the
Emerging Markets. That was the second consecutive year the magazine has elected their Bank
for that award.
The award was presented to the Bank on the occasion of the World Bank IMF meeting in
Washington in 2002. While the magazine formally announced the names of the award winning
Banks including Askari Bank in the May 2002, they have already issued press information for
the international media.
List of awards win by Askari Bank over the years for the quality of banking services to
individuals and corporate.

• Best Consumer Banking Award 2006.

• Best Commercial Bank Consumers’ Choice award 2005 by the Consumers Association
of Pakistan

• Best Corporate Report award 2008.

• Best Retail Bank in Pakistan award 2004 & 2005 by the Asian Banker.

• Best Corporate Report 1st prize award 2000 to 2004 by ICAP and ICMAP.

• Corporate Excellence awards for 2002 & 2003 the Management Association of
Pakistan.

• Best Corporate / Institutional Internet in Pakistan award for 2004 by Global Finance
Magazine.

• The Best Bank in Pakistan award for 2001 & 2002 by Global Finance Magazine.

• Best Presented Accounts awarded from 1997 to 2002 by South Asian Federation of
Accountants (SAFA).

• Commercial Bank of the Year award for 1994 & 1996 by Asia Money Magazine.
• Best Domestic Bank in Pakistan award for 1995 by Euro Money.
ORGANIZATIONAL CHART

Board of Directors

Executive Committee Internal Audit

President Chief
Executive

Corporate Banking
Operation & Credit Retail Banking Corporate &
& Financial Inst. Regions
Group Group Planning Division
Group
Business Dvlp.
Corporate & Credit Cards System & Operation Division
Merchant Division Division Division South
HR Division
International Investment Electronic Technology
Law Department
Division Product Unit division Central
Finance Division
Asset Product
Treasury Division Credit Division North Audit Division
Unit
Board of Directors
Lt. Gen. Javed Zia (HIM) Chairman
Lt. Gen (R) Imtiaz Hussain Chairman Executive Committee
Maj Gen (R) Saeed Ahmed Khan Director
Mr. Zafar Alam Khan Sumbal Director
Dr. Bashir Ahmad Khan Director
Mr. Shahid Mahmud Director
Mr. Muhammad Riyazul Haque Director
Mr. Ali Noormahomed Rattansey Director
Mr. Tariq lqbal Khan Director (NIT Nominee)
Mr. Muhammad Rafiquddin Mehkari President & Chief Executive

Mr. M. A. Ghazali Marghoob Company Secretary

Audit Committee
Dr. Bashir Ahmad Khan Chairman
Mr. Ali Noormahomed Rattansey Member
Mr. Zafar Alam Khan Sumbal Member

Auditors
A.F.Ferguson & Co. Chartered Accountants

Legal Advisors
Rizvi, Isa, Afridi & Angell

Registrar & Share Transfer Office


M/s THK Associates (Private) Limited,
Ground Floor, State Life Building # 3,
Dr. Ziauddin Ahmad Road, Karachi - 75530
P.O.Box No. 8533, Karachi.
Tel : (021) 5689021, 5686658, 5685681
Fax: (021) 5655595
UAN: 111-000-322

Registered Office /Head Office


AWT Plaza, The Mall,
P.O.Box 1084, Rawalpindi.
Tel : (051) 9063000
Fax: (051) 9272455
Website: www.askaribank.com.pk

Head Office
M. R. Mehkari President & Chief Executive
Agha Ali Imam, SEVP Group Head, Consumer Banking Services
Tahir Aziz , SEVP Group Head, Corporate & Investment Banking
Muhammad Arif Mian Chief Risk Officer
S. Suhail Rizvi , EVP Group Head, Operations
Javed Iqbal Chief Information Officer
Moghis Bokhari, EVP Country Head, Human Resource
Rehan Mir , EVP Acting Group Head, Treasury & International
Saleem Anwar , EVP Banking
Country Head, Strategic Planning & Corporate
Khalid Mohammad Khan, EVP Affairs Head, Compliance & Data
Country
M. Farooq Abid Tung, EVP Country Head, Agriculture & Rural Business
Rana Shahid Habib, EVP Country Head, Audit & Inspection
Hashim Khan Hoti, EVP Country Head, Islamic Banking Services
Tariq Maqbool, EVP Country Head, Risk Management
Mian Shaukat Ali Arif Sirhindi, EVP Country Head, Consumer Banking Services
Mohammad Munir Ahmed, EVP Country Head, Electronic Technology
Muhammad Ahmed Khan, SVP Country Head, International
Lubna Azam, SVP Chief Credit Officer
Adil Zaidi , SVP Country Head, Centralized Foreign Trade Unit
Masood Qadir , SVP Country Head, Credit Administration
Brig. (R) Muhammad Ifzal Country Head, Establishment
Hassan Aziz Rana, SVP Country Head, Legal Affairs
Syed Hasan Sajjad Country Head, Operations
Bilal Bin Zaheer Special Asset Management
Mahmood Ahmad Nasir, VP Acting Chief Financial Officer
Iftikhar Baloch, VP Acting Chief Information Security Officer
Regions / Areas / Off-shore Branch
Central Region
Ejaz Ahmed Khan, SEVP Regional General Manager, Central
Sajjad Ahmed Qureshi Area Manager, Lahore – I
Khawaja Shaukat Iqbal, EVP Area Manager, Lahore – II
Tahir Yaqoob Bhatti, EVP Area Manager, Faisalabad
Saulat Hameed , SVP Area Manager, Lahore – III
Sajjad Ali Sheikh, SVP Area Manager, Multan
Mushtaq Ahmed , SVP Area Manager, Gujranwala
North Region
Haseeb Saulat , EVP Regional General Manager, North
Tariq Mahmud Khan, EVP Regional General Manager, North
Syed Tauqir Haider Rizvi, SVP Area Manager, Rawalpindi – II
Inamullah Khan Niazi, SVP Area Manager, Azad Kashmir
Tanveer Afzal Khan, SVP Area Manager, Peshawar
Qaiser Iqbal Khan Area Manager, Islamabad
South Region
Muhammad Jaffer Khanani, EVP Regional General Manager, South
Saif-ur Rehman Khan, EVP Area Manager, Karachi – II
Nehal Ahmed, EVP Area Manager, Karachi – III
Mirajuddin Aziz, SVP, Area Manager, Karachi – I
Qazi A.M. Khalid, SVP Area Manager, Karachi - IV
Niaz Mohammad, SVP Area Manager, Hyderabad
Hafeez Ur Rahman Quraishy Area Manager, Quetta
Wholesale bank branch, Bahrain
Muhammad Naim Ilyas Wholesale Bank Branch, Bahrain
Departments
Banking procedures are divided between various departments. Different departments do their
jobs in the occurrence with the bank policies. In Askari Bank each branch is divided into various
departments. Head of department manages each department and officials of the branch follow the
procedures. There are two basic departments in each branch of the Askari Bank: General
Banking Department and Credit Department, and the third department that’s Foreign Exchange
Department exist in those branches who are allowed by the SBP.

 General Banking Department

 Credit Department

 Foreign Exchange Department

General Banking Department


There are four basic departments in main branch, Lahore of Askari Bank in the General banking
Department. These departments are controlled by the Operation Manager or General Banking
Manager.

 Account Opening Department

 Cash Department

 Clearing Department

 Remittances Department

 Lockers

 ATM Cards

 Credit Cards

Now we discuss the operation of each depart separately.

Account Opening Department


Borrowing funds from different sources has become an essential feature of today’s business
enterprises. But in the case of a bank borrowing funds from outside parties is all more vital
because the entire banking system is based on it. The borrowed capital of a bank is much greater
their own capital. Banks borrowing is mostly in the form of deposits. These deposits are lent out
to different parties. Such deposit creation is done through opening an account in the bank.
Types of Accounts
In ASKARI BANK, there are the following types of accounts:

 Current Account.

 Saving Account.

 Askari Special Deposit Account.

 Unique Account.

 Foreign Currency Account.

 Askari Bachat Certificate.

 Notice Deposit.

 Term Deposit.

 Call Deposit.

Current Account
In current account there is no interest on it. It is for only transaction purposes. They are paid on
demand. When a banker accepts a demand deposit, he incurs the obligation of the paying all
cheques drawn against him to the extent of the balance in the account. As there is no profit paid
on this account it is also called chequing account because cheques can be drawn on it. Current
account is mostly opened for business. In current account unlimited transactions are done. The
minimum deposit for opening current account is Rs. 5,000.

Saving Account
The purpose of this account is to induce the habit of saving individuals in the neighborhood.
PLS account is normally opening for individual, charitable institution, provident and other
benevolent funds. The profit is PLS saving and ASDA Accounts in ASKARI BANK are
chequing accounts paid on the basis of profit and loss sharing at the rate of 8.5% six monthly.
The minimum deposit for opening the account is Rs.5, 000/- (as obvious in the Annexure).
Though individuals open such accounts for saving purpose persons belonging to Armed Forces,
and different military institutions open this account. If the balance in the saving account is
decrease from the limit i-e 5,300 in any day of the month then Rs. 50 will be deducted from it.
Askari Special Deposit Accountant (ASDA Account)
ASDA account is an interest bearing current account interest is paid on it at the rate of 8.00% it
is open with the minimum balance of Rs.5, 000. The payment of return is monthly, where as the
rate of return with aspect to the amount of minimum deposit clear from deposit schedules in
annexure. It is also chequing account because cheques can be drawn on it. It is necessary for this
account that the client must maintain a minimum balance of Rs. 5,300 million at the end of the
month, no interest is paid. That’s why it is similar to current account. It has the function of
current as well as the saving account.
It is mostly opened by business but individuals to open this account.

Unique Account
This type of account is mostly opened by the individuals with the minimum opening balance of
Rs. 5,000. There is restriction in it of maximum two debits and two credit transactions in a
month. There is no profit and deduction on it.

Foreign Currency Account


It is opened for the person who receives funds from outside the country. The currency is
mentioned in the account opening form.

Askari Bachat certificate


ABCs are long term fixed deposit for 3 and 5 years. These are not term deposits because
payment of return is on monthly basis rather than on maturity of deposits. The minimum balance
requirement is Rs. 2, 5000/- and maximum balance requirement is Rs.1.0 million. If ABC is for 3
years, the rate of return for 3 years is 12%, if ABC is for 5 years the rate of return is 13.00%.
Because in such account the balance is kept for either ‘3’ or ‘5’ years within the bank no cheque
is drawn on it. That’s why it is not a chequing account, but only payment of return is made
monthly.

Notice Deposits
Notice deposits are kind of fixed deposits. The minimum balance requirement for opening the
account is Rs.5000/- and payment is drawn on maturity of the specific period. Notice deposit is
of the two kinds:

 One for which a prior notice of 30 days and above is required from the customer before
withdrawing deposited amount and for which rate of return is 8%.
 Second for which a prior notice of 30 days and above is required from the customer
before withdrawing the deposited amount and for which rate of return is 10%.

Term Deposits
A term deposit is a deposit that is made for a certain periods of time. At the end of the specific
period, the customer is allowed to with draw the principle amount.
After the maturity of the term deposit the profit is given to the customer. The rate of return on
this account is 12.0% for 4 years.
The term deposit account varies from one month to 5 years, and the minimum balance
requirement is Rs.5000/- for all other accounts (as clear from deposit scheme in the annexure).

Call Deposit
Call deposit is different from the term deposit. This is basically use for tenders. If a tender is
made, a certificate is given to the person who got the tender. When the work is completed the
issuer of the tender stamped the certificate that the tender is realized. After that the person come
to the back and gets the amount. No profit or loss is given on it.

Profit Calculation Methods


Monthly payment of return
Profit = (deposited amount *rate of return) / 12
Where 12 = no of the months in a year
Profit = (50000* 9.5) / 12
=Rs.395/-

On Maturity basis
Profit = (Principal amount * Rate of return) * (no of days or no of the months from the
date account opening).

For PLS saving account


Profit (minimum balance * rate of return) / 2
= (100 * 8.5%) / 2
8.5/2 = Rs.4.25/-

The amount of profit is given to deposits in three ways:


 By cash
 By sending a bank draft to depositors home address or officers or whichever is specified
as mailing address.

 The amount is credited in any one of the checking accounts of the depositor.

Account Opening Procedure


For the chequing accounts (C/A, ASDA, SAVING), there are different types of account holders
are required for all these types of account holders. The operation / procedure requirement that is
needed for “Individual Account” differ greatly from “Joint Account” Proprietorship
“Partnership”, “Limited Company” and “Club Society or Association” as explained below.

Individuals’ Account
When a single man or woman opens an account in his/her own name and has the right to operate
it is called individual account. It may be of salaried person’s account current or saving accounts.

Documentation
 National Identity Card.

 Employee certificate/ appointment letter along with recent salary slip for salaried person.

 Visiting card not only acceptable if exist than feasible.

 In case of the Doctor an application on the letter head of the Doctor and certificate of
him/her this type of account is called Self Employed Account.

 For lawyer court registration.

 For student ID card of the college or university.

Operation
 The person place a “Check Mark” in the type of account and type of operation required.

 He/she fills in part-1 of the form, a fix his/her either two or four similar signature (or
thumb expression in the signature space and get it introduced and signed by a person who
already has an account with the bank and write his account no in the specific rows in a
specific space.

 The person fills in “next of kin” position where he/she father, mother, husband/wife or
any other relative’s name, his/her address, phone no and affix his/her signature to certify
this requirement. This requirement is needed because in his/her absence bank can have
correspondence with the specific person.

 The person put her/his signature (or thumb expression) on the signature specimen card
(SS CARD) similar in the area on the form. One the back of SS card mailing address,
telephone no, person to contact and introducer space is filled in. These entire
requirements are necessary for future. SS card is scanned by the bank and check it when
they want to verify the signature of the customer.

 The person deposits the initial amount for opening account on to the cash counter. The
person put his signature on form-A (check book requisition) on two places in “authorized
signature” and fills in the “Title of Account” space by writing his name.

 If the person put his signature in Urdu or any language other than English, or thumb
impression he/she signed a “Vernacular Form” where he undertakes that affixed signature
is original and his own signature.

 If the signature of the depositor on the A/C opening form is different from the signature
on the CNIC then he has to fill an undertaking of it.

 Know Your Customer Form is also attached with the form.

 The next day is the opening of account.

 After the opening the account the bank sends a letter of thanks (LOT) to the customer. On
the basis of LOT the first cheque book is issued.

Joint Account
When two or more persons, neither partners, nor trustees, open an account in their name is called
joint account. Joint account can be opened by husband and wife or two persons of same sex.

Documentation
For joint account copy of N-I-C Card of all the persons is obtained other things remaining same
as in individuals account.

Operation
 The person checks the type of amount and type of operation required in the respective
box on the form.

 The persons fill in the Part-I and Part-II in the form.


 Signatures of both persons are obtained on the form in the area specified for signature
and SS Cards.

 In the title of account space names of all persons are maintained.

 Accounts holder specified in the form that they will operate the form singly or jointly.

Proprietorship Account
When the owner of the firm operating singly, opens an account in his firm name of when an
owner of a firm operating singly, opens an account in his firm name, this account is called a
proprietorship account proper himself liable for all his acts.

Documentation
For this kind of account, an application for opening the account on the firm letter – pad (having
the firm name) is required along with the NIC copy of proprietor, Rubber stamp and NTN.

Operation
All operation remains the same except that the firm name is written in the “Title of the Account”
area and signature of the proprietor are affixed in the SS Card and the area specified for
signatures on the form.

Partnership Account
The account is opened in the firm name and all partners designate one or two persons to act on
behalf of the partnership firm all acts on behalf of firm. The partners in the partnership firm are
liable for the acts of the firm jointly and severely. Every partner in a firm has an implied
authority bind his co. partners by drawing and enclosed cheques.

Documentation
 Copy of N.I.C. Card of all partners.

 Application to open the account on the firm’s letter pad.

 Partnership deed in case registered partnership firm.

 Registration Form (Form-C)

 Board Resolution on Letter Head

 NTN

 Letter showing the implied authority of one or more partners to act on behalf of the firm.
 In case of non-registered partnership firm, understanding on behalf of the firm to remain
liable for all acts of the firm.

 Name, address of all partners is written on the pad.

Operation
All other requirement remain same except that the form is dully signed by all partners SS card is
signed by all those partners who will act on behalf of the firm and along filling Part-I, Part-IV is
also filled.

Limited Company Account


Documentation
 Account opening request on Letter Head.

 Embossed seal resolution (clear instructions regarding operation of the A/C)

 Certified copies of Memorandum of Associations/Form-29.Certificate of incorporation /


Certificate of commencement of business.

 Articles of Association

 List of directors and authorized signatories.

 SS card duly signed.

 Copies of CNIC of company secretary/ all Directors.

Operation
The person authorized in the resolution of the Board of Directors put their signature on SS Cards.
Next of Kin requirement is not need in case of a limited company.
After completing all these formalities, introducer’s signature is verified customer signatures are
admitted by stamping “Admitted” near signatures and again signatures on SS card are admitted
in the same way. The same process of verification and admission of signature is repeated on the
form-A and signature on next of Kin area.
After completing each and every formalities, are signed by all those partners who will act on
behalf of the firm and along filling part-I, part-IV is also filled.

Minor Account
 Guardian can be natural /parent/legal. They can operate he account
 Account must be title as “Minor account”.

 Style should be Zulfiqar Ahmad (M) Aftab Ahmad (G).

 No credit facility extended to minor account.

 Date of Birth of Minor and the date of maturity should be mentioned on the SS card and
on account opening form (AOF).

 At the age of the maturity the account should be ceased.

 Entire credit will be transfer to new account of the minor at the time of maturity if minor
want.

 In case of legal Guardian the appointment letter issued by the court should be examined
and its copy should be retained with AOF.

 Copy of CNIC of the guardian (legal or natural)

 Form- B of the minor.

Trust/ Society/ Provident Funds


 AOF filled by the company nominees

 Employees provident fund registration certificate

 Trust deed of the employees’ provident fund

 Formal account opening request dated by the company along with copies of CNIC of
company’s nominees

Other Responsibilities of Account Opening


Department
Letter of Thanks
At the start of the letter 2nd day, ASKARI BANK issues letter of thanks to “Account opener” for
the trust they have on ASKARI BANK.

Stamping “Posting”
After completing all this process, the forms are signed from manager of the branch after which
forms are stamped across as “POSTED” on one corner of the front side of the form. Then they
are posted in the respective. “Account opening file” very next day cheque book is issued to the
customer when customer brings the Letter of Thanks (LOT). The official person checks the LOT
and fills a slip with account holder signature along with the verification of the sign. The account
opening form is attached in the Annexure.

Cheque-Book Issuing
Check books are issued only for chequing account such as current account, saving account and
ASDA account. They are not issued for other fixed and term deposits because of their long term
accounts “nature”.
When an account is opened, cheque-book is usually issued the next week; cheque-books are
issued whenever customer needs cheque-books.
Cheque-books leaves vary with the nature of the account. For example, 25 to 100 leaves cheque
book are issued for current and ASDA accounts. Whereas 10 to 25 leaves cheque book are for
saving accounts. Usually 25 leaves cheque-books are given only army fund accounts, and 10
leaves cheque-books are handed over to “easily individual’s account, holder”.
In Askari Bank, the fact behind issuing current and ASDA and 50 leaves for and 10 leaves and
25 leaves for saving accounts is the SBP requirement which is of the view that, because current
and ASDA accounts are for business transactions purposes, therefore they need more leaves
cheque-book. There is Rs.2/- excise duty and 50-paisa provincial tax carried on cheque book
leave.

Charges of Cheque Book Issuance


 Total charges of issuance of Cheque book are Rs. 6/- per leaf.

 If you want to get loose cheques then you have to pay Rs. 320/-.

 Reissuance of the cheque book against Form B charges are Rs. 550/- plus Rs. 6/- per leaf.

Issuing procedure
Firstly, signatures on cheque book requisition are verified by matching with signatures on SS
Cards.
Secondly, cheque book leaves number, account number, account holders’ name are mentioned in
the cheque book is made by mentioning and the total of sum of excise duty and provincial tax.
Thirdly, the name of A/c holder and date of cheque book issuance is written on cheque book
requisition the account opening officer puts his initials on requisition leave.
Fourthly, A/c number is stamped over the leaves of cheque book and finally authorized person
affix his signature over the debit voucher and he voucher is attached from the cheque book and is
handed over to the customer.

Account closing
Account is closed on the written request of the customer Askari Bank debits Rs. Nil as charges
for closing the customer account from that account. The account holder withdraws the amount by
writing a cheque and just leaves Rs.100/- in his account. But to surrender the cheque book yet if
some leaves are yet to be write to the bank as a necessary requirements for closing the account.

Procedure
1. The customer for individuals account write an application to the manager of the bank a
simple paper about the closing of his account with the bank (In case of proprietor ship
partnership and limited company account the application should be written on firm or
company letter-head).
2. The individual or in case of other type-proprietor firm and company surrender the cheque
book to the bank.
3. The cheque book is then torn from one side and is attached with the application.
4. In case of Ltd. Company Account resolution of the board of directors is also obtained to
attach it with the application.
5. The account opening form of the account holder is taken from the account-opening file,
and the application, cheque book, and resolution of board of directors in case of limited
company account are attached with the form.
6. Lastly, it is written in “Red Ink on the form that account closed” and “Date of account
closing”.

Everyday posting
At the end of each day, posting of cheque books is performed, the account opening department
OG3 makes credit vouchers of excise duty and provincial tax on cheque book leafs, and posts it
in the company and at the end of the day all the leafs with the vouchers send to the Accounts
department.
Procedure of Opening Other Accounts
Askari Bachat certificate
The ABC application form is filed and signed. All the requirements are properly fulfilled. The
detail is written.

 The credit voucher is made against the cash that the customer deposits to the
bank.

 The certificate is filled according to the specification.

 The certificate is then handed over the customer.

 The entry is made in the ABC register.

 The application is then posted in the file.

Notice deposit
The procedure for issuing notice deposit in ASKARI BANK is as follows:

 The customer comes to the bank and specifies the number of days for which he
wants to deposit hid money in notice deposit.

 The credit voucher is made for the amount of cash to be deposited the presence of
account is not necessary.

 The notice/deposit form is then filled by the officer. The date of opening, the
period the name of the customer, the signature etc. is all written on the form.

 The notice deposit receipt is filled according. All the requirements are carried out
the signature of the customer and the authorized officer, the stamp of the bank etc.

 The notice deposit receipt is then given to the customer.

 The number of the notice deposit form and notice deposit is noted receipt is then
given to the customer.

 The number of the notice deposit form and notice deposit receipt is noted in the
notice deposit register.

 After completion of the form, it is posted in the notice deposit file.

 A 0.2% tax on the principal amount is taken while issuing the receipt.
 A credit voucher made and the amount is credited to the tax on ND.

Term deposit
Any person can open a term deposit. He needs not have an account in the bank. The procedure is
the same as that of the notice deposit.

Cash Department
Cash department is very sensitive and risky part of the bank. Very cautious and competent
personnel are needed for this job. ASKARI BANK has really such a diligent staff with
appreciable competencies and will to do work. No internee is allowed to go in the cash
department. Main function of Cash department is to deal with cash payment and cash receipts.

Cheque
Cheque is bill of exchange drawn on specified banker and not expressed to be payable otherwise
than on demand.

The Request of a Cheque


 It should be in writing.

 The drawer must not put any condition for the payment of the Cheque.

 Drawn on a specified banker only.

 Payable on demand.

 A certain sum of money.

 Payable to a specified person.

 Signed by the drawer.

Types of Cheques
There are two types of cheques.

 Foreign Currency Cheque

 Pak. Rupees Cheque

In the cash department the record in maintained in different types of books and these are:
1. Receiving Cashier's Book (FCY)

2. Receiving Cashier's Book (Pak. Rupee)


3. Paying Cashier’s Book (FCY)

4. Paying Cashier's Book (Pak Rupee)

5. Daily cash position Book (FCY)

6. Daily cash position Book (Pak Rupee)


The receiving cashier’s book is used to write down the details of the incoming cash.
The paying cashier’s book is used to note the details of the outgoing cash.
The daily cash position books are used to prepare the daily ending balance of the cash on hand.
The books for foreign currency are separate while the books for the Pakistani Rupee are separate.

Cash Deposit Procedure


A customer comes to deposit cash in his account. The procedure followed in the cash department
in this case as follows:
1. The customer fills the pay-in slip. There are two types of pay-in slips. The red slip
is filled if he is a current account holder. The cashier receives the pay-in slip and cash.
2. He counts the cash and makes the detail of the notes at the bank of the pay-in-slip.
3. Then he compares the detail with amount written on the pay-in slip.
4. Signs the pay-in Slip.
5. Writes the entries in the Receiving cashier's book, i.e. serial No, account type,
account number, cheque number and amount.
6. Puts the stamp of the Cash Received on the pay-in slip of writes the serial number
from the receiving cash book.
7. The first portion i.e. the Receipt is taken and given to the customer. While the
latter portion is handed over to the person for the entry in order to update the data.

Cash Payment Procedure


When a customer comes to withdraw a certain amount from his account, he brings a Cheque
along with him. In this case the following steps are taken.
1. The cashier receives the Cheque and check it whether it is posted or predated. Cheque
can be cashed within six months. A repeated Cheque cannot be cashed.
2. He takes two signatures at the back of the Cheque from the bearer.
3. He gives the Cheque for posting at the computer. The computer checks Out whether there
is balance in the account or not. Other instructions are also received e.g. blocked, frozen,
etc. The posting is done the a/c is debited and the Cheque is stamped “posted" with the
serial number and date.
4. The cashier counts the cash and makes the detail at the back of the Cheque.
5. The cash is paid to the person and the Cheque is stamped “Cash Paid" immediately.
6. The entry is made in the Paying Cash book and the Serial number is written on the
Cheque.

Calculation of Ending Cash Balance


The official time for receiving deposits and payments is till 1:35. However some important
customer is accommodated afterwards.

 The cash in hand is counted. It contains the cash at the counter and the cash in the strong
room.

 Then opening balance is taken, i.e., the ending balance of the previous day.

 The receipts are added.

 The payments are deducted.

 This daily cash position is written down on the daily cash position book.

 If the cash is increased from the minimum cash requirement i-e three hundred million,
then the exceeding cash is sent to the SBP and SBP pay interest on it.

Cash Management
Cash management is a technique of managing cash according to the requirements of the
bank on daily basis. The operation manager manages this aspect of cash. Every Branch has an
accountant at the State bank Of Pakistan. A 5% of the total deposits has to be maintains so there
are two main sources of the cash.

 State Bank of Pakistan.


 Head Office.

If Branches borrows cash from Head Office it has to pay an interest of 13%. On other hand, if the
cash is remitted to head Office, The branch gets a profit at 12.75%.

Liquidity Maintenance
Askari Bank has to maintain 35% liquidity at SBP. Every branch maintains 5% of its deposits at
the local SBP. But this 30% is kept in the form of Approved securities, e.g. Foreign Investment
Bills and Treasury Bills.
Clearing Department
It is the department where all bills from outward and inward are cleared. In it there are two sub
departments

 OBC

 Local clearing

OBC
It is the department where the funds are collected from outwards and pay to bank’s own
customers and collect funds from bank’s customers and pay it to other banks out of city. Under it
there are two processes

• Inwards Bill for Collection

• Outwards Bill for Collection

Inwards Bills for Collection (IBC)


When the cheques of Askari Bank is given to the customers of other out of city banks by the
customers of Askari, then Askari has to collect funs from its customers and to pay the other
banks this process is called Inwards Bills for Collection (IBC).

Outwards Bills for collection (OBC)


When the cheques, DD etc of other banks out of city is presented in Askari Bank by its
customers then Askari has to collect funds from other banks and credited this amount in the
customer’s account this process is called OBC.
There are three methods of OBC and IBC
1. Direct
2. Indirect
3. National Institution of Facilities Transfer Pvt. (NIFT)
1. Direct Method
This method is used for transfer of funds when there is no facility of NIFT and no branch of
Askari bank exist in the city in which the bank is situated to whom deal with. When Askari
receive cheque or any other instrument from its customer of bank of other city and there does not
exist NIFT and the branch of Askari then Askari processed the cheque and send directly to that
bank through courier. That bank clear the cheque and send funds in the form of DD and send it
back after deducting it charges. When Askari receive the funds it deducts its charges and credit
the remaining amount in the account of its customer. This process is called direct OBC.
In the same way when other banks receive cheques of Askari bank they send it to Askari and
Askari deduct the commission and taxes and the original amount from the account of the
customer who gives the cheque and send funds to that bank. This process is called direct IBC.
2. Indirect Method
In this case there exists the branch of Askari but not NIFT. Askari receive cheque and send it to
branch of it and that branch locally clear the cheque after receiving funds and send that funds to
responding branch. This is called indirect OBC.
In the same way when the cheque of Askari is presented in other bank in the other city
where NIFT does not exist then this bank send that cheque to its on branch of that city. That
branch locally clear the cheque and send funds to its branch back. This is called indirect IBC.
3. National Institution of Facility Transfer (NIFT)
It is the institute that provides the facility of transferring funds of one bank to other bank from
one city to other. In most of the big cities of Pakistan that institution exists except some. NIFT
provides full services of collection of cheques from one bank; keep every type of record of these
cheques and then send these cheques to the responding bank.

Procedure of IBC
• Askari cheques received by the other banks in other city, they processed it and send to
NIFT.

• Next day NIFT send these cheques to Askari after keeping record with a detail sheet
of those cheques. That detail sheet contains the detail of the other IBC of the other
branches of the Lahore.

• Also send the detail sheet of each branch IBC in it.

• Main branch clears all its cheques and which accounts have low balance or any other
reason their cheques are rejected.

• These rejected cheques send back to NIFT and they send it to corresponding bank.

• Clear cheques are signed by the two attorney holders.


• The amounts of those cheques which are cleared are debited in their accounts.

• Inter the data of the Outwards and Inwards Bills System and generate a report of it.

• Then Askari receive the IBCA from each branch of Lahore.

• These IBCAs contain the amount which has been cleared in these branches.

• Askari main inter these amount in the Excel sheet and find the net IBC funds.

• Send the funds to the Head in Karachi in the form of advice.

• At the Askari make a debit voucher and a credit voucher and send it to Accounts
Department.

Procedure of OBC
 Collect the cheques from our customers of other bank from other cities.
 Customer fills the slip of the same amount as on cheque.
 Officer receives the cheque and deposit slip
 Signed the slip and give receipt to customer
 Three stamps are pasted on the cheque
 Cross stamp of Askari bank
 Payees account will be credited
 OBC No.
 Then inter the data in the Outwards and Inwards Bills System it generate an OBC
number, this OBC number is write in the stamp of OBC.
 Then these cheques send to the NIFT
 Then after two day the bank send returns to NIFT and Funds to Their Head Office
 Then Askari’s officer download the copy of OBC and returns and printout them.
 After that he deduct the returns from the OBC of the each bank of each city
 The final amounts are interred in the IBCA System which contains amount, date, bank
name, and branch.
 In this system presenting date of the cheque is interred.
 Generate a report of the data interred.
 Compare the total amount of each city and then compare the final amount if equal then
ok, if not then check it and correct it
 Then generate two copies of IBCA of each branch of Askari from which this amount is
collected.
 Sign by two attorney holders and stamp on it of the bank.
 One copy is kept in record and the other one is stamped with Intercity Clearing and send
to each branch of Lahore.
 The advices of Islamic Banking and Main Branches are not made because Main branch
has their accounts.
 At the end of the day one advice is made by debiting the account of the main branch and
credited by the same amount on one credit slip.
 And the IBCA is send to Karachi Head Office.

Local Clearing
There is no legal obligation on a banker to collect cheques drawn upon other banks for a
customer. However it is function of almost every modern bank of the collection of cheques and
bills on behalf of the customer.
Clearing department services are provided in order to make arrangements for the economic
collection of the cheques, DD’s pay and other negotiable instruments. A large part of this work is
carried on through the clearinghouse.

Clearinghouse
Clearinghouse is a place where all the representation of different banks and exchange all means
of transaction other than cash and then settlement procedure carried out for the balancing of the
SBP accounts.
The clearance house is in the new Davis road, Abulmalik Plaza, 3rd Floor Lahore. All the clearing
members of each bank go to the clearinghouse for the first clearing at 9:30 am and for the second
clearing at 1 to 2 pm.

First clearing
NIFT is the clearing member of Askari. Rider of the NIFT takes the outward cheques and goes to
the clearinghouse. The outward cheques are given to the respective branch members and inward
cheques received. A summary is prepared and given to the supervisor of the clearinghouse. He
balances the accounts of all the banks.

Second clearing
After the outward cheques, they are checked and the ones to return are to be attached with a
memo. Then at 1 to 2 pm, clearing members goes for the second clearing. At this returned
cheques are received. Once again, the summery is prepared and given to the supervisor for
balancing. The supervisor balances the accounts of nearly 25 banks. The SBP gives ending
position to each member.

Role of the clearing department


Suppose X is an account holder of Askari Bank, and he has to pay Rs.2, 000/- to pay who is an
account holder of MCB. X draws a cheque in favor of Y and gives it to Y. Now Y instead of
coming to Askari Bank for payment, deposits the cheque at MCB Bank. The MCB Bank clearing
members will bring those cheques to the NIFT and gives it to Askari Bank clearing members.
The Askari Bank clearing members brings it back to the bank and checks the validity of the
cheques and in the second clearing the MCB members it told that his cheque has been cleared.
This is called inwards. Similarly the cheques of the other banks are cleared from Askari bank.
This is called outwards.

Book Keeping
There are three registers in this department:

 Clearing summary register.

 Inward clearing register.

 Outward clearing register.

 Returned register
Clearing Summary Register
In this register the clearing summary balance is made. The received cheques and the delivered
cheques are written in the respective columns.

Inward Clearing Register


The inward clearing register used to write the details of the inward cheques cleared. Inward
cheques are those cheques, which have been recovered from the different banks. The amount of
these will be credited from one SBP Account. So these cheques are against us and have a
negative effect.

Outward Clearing Register


The outward clearing register is used to write down the detail of the outward cheques. Outward
cheques are those cheques, which have been delivered to different banks. The amount of these
cheques will be debited to SBP account so these cheques are in favor of us and have a positive
effect.

Return Register
This register contains all the data of the cheques which are returned due to number of reasons. In
this register officer write the cheque number, amount and reason for what is returned.
Different instruction is dealt in the clearing department. All negotiable instruments e.g.

 Cheques

 Pay slips

 Pay orders

 Term deposits

In order to make arrangements for the speedy and economic collection of cheques, bills and other
documents payable or deliverable at or through offices of members of clearing house clearing
services are provided in all the big cities by NIFT.

Procedure of Inwards
The following procedure is adopted by the branch for clearing items.
 In the morning rider gives the cheques to the bank.
 Then the account of the customer who issues the cheque is debited and returned the
cheques which are not fulfill the requirement of the clearing.
 Then all the cleared cheques are U. V Scand.
 Then canceled the cheques and send for the supervision to the head of the clearing
department and to the operation manager.
 After the supervision some cheques may be returned.
 Then funds of all the cleared cheques are sent to the head office in the form of advice.
 Head office collect funds from all the branches and send to SBP.
 Cheques send to the accounts department they keep these cheques as a record.

Procedure of Outwards Clearing


 All cheques received for outwards clearing to be deposited by the customers are be
accepted on the bank’s relevant pay-in slip (ACB DEP FM 007/008) duly filled in by the
depositor as per printed columns of the pay-in slip.
The depositor should write the instrument number, the name, and the branch of the bank
drawn on and should sign at the prescribed column (deposited by) for his signature.
 Immediately on the receipt of the instrument the cleaning official of the bank affixes the
bank’s crossing and clearing stamps on the face of the instrument payee’s account will be
credited on the back of the instrument. The pay-in-slip shall be stamped on both parts
with the clearing signature beneath the stamp.
 Then the amount is credited in the account of the customer and system gives a sup. Code
this code is wrote on the cheque.
 All instruments received over the counter and from branches for outward clearing are
entered in the outward clearing register (Askari Commercial Bank CLG BK 953). All
columns of the registers are filled in for each instrument received from any other branch
of the bank; the name of the branch is mentioned in the column for the name of depositor.
 Then these cheques are given to the NIFT
 After clearing all the cheques the detail of these cheques is sent back to NIFT by the
responding bank and as well as the returned cheques.
 These returned cheques give back to the customer who deposits that.
 In the next day bank receive the advice of the fund clear and the detail of the clear funds
of main as well as the other branches of the Lahore.
 The main branch gives these funds to the other branches in the form of credit advices and
sends a debit voucher of the same amount to the accounts department.
 The grand totals of all schedules amount and number of instruments must agree with the
totals as per outwards clearing register.

Same Day Clearing


All the cheques are cleared after one day. If the customer says for the same day clearing then
bank official affixes the stamp of same day on the cheques and send to the bank through the
NIFT. The funds are received within 24 hr. from the time of collecting the cheque. But this
cheque must be of more than Rs.50, 000/- . The charges of same day clearing are normally in
higher than the normal procedure.

SBP Accountant and Clearing


All the clearing transactions are done through the SDP Account. At the end of the working day
this SBP account has to be 5% a penalty is charged against the bank. Hence through cash
management, limit is maintained taking into account the clearing transactions.

Clearing Position Statement


After the 1st and 2nd clearing the clearing positioned is prepared.
A Inwards cheques, Demand Draft, Pay orders etc.
B Outwards Cheques, Pending cheques
If amount B is greater than amount A, it means that our cash balance at SBP has increased and so
it is a favorable for bank. On the contrary, if A is greater than B, it means that cash balance in
SBP account has decreased and here it is unfavorable for the bank.

Charges of Bills
Collection Clean
i) 0.19% min Rs. 65/- (Upto Rs.100,000/-)
ii) 0.15% min Rs.275/- (Rs. 100,001-1,000,000)
iii) 0.80% min Rs.1300/- (over Rs.1,000,000)

Intercity Collection for Cheque through NIFT Charges


i) Rs.300/- per item (Upto Rs. 1 Million)
ii) Rs.585/- per item (over Rs. 1 Million upto Rs. 2 Million)
iii) Rs.1300/- per item (Over Rs. 2 Million)
Remittances Department
Remittance department provides to the customer of the bank for their convenience to transfer
funds. The main function of this department is transfer of funds.

Instruments of Bills and Remittance Department


The instruments that are handled in the Remittance department are as follow:

 Demand Draft

 Telegraphic transfer or Mail transfer

 Pay order

 Pay Slip

Demand Draft
A demand draft is an instrument, which is drawn by one bank upon another bank for a specific
sum of money payable on demand. It is made by the bank and given to the purchaser against
cash or cheque.
If two banks are involved, then one bank sends a DD to another bank. But in customer case, the
customer sends his DD to the receiver.

Issuance Procedure
A demand draft application to given to the customer, he fills in a relevant information and signs
it.

 The officer in charge then checks the information form.

 The charges such as commission, excise duty, postage are charged as per effective
schedule of Charges. Tax is exempted if he is taxpayer and knows his NTN.

 In case of cash deposit the cashiers counts his amounts and sign the DD application and
enters it in the register.

 The cash received equals the amount of remittance and the cheques there on.

 Then the officer of the bills and remittance department signs it and operation manager
counter signs it.

 The entry is made in the DD issuing register.


 It is given to the customer.

 Vouchers are passed.

 The vouchers and the DD form are posted at the computer.

 The DD advises be printed at the computer and mailed to the respective branch.

Payment Procedure
On the country, when a DD is received i.e. a customer go to bank with the DD, the procedure is
as fallow.

 The DD credit advice is received through mail. The numbers are checked and signatures
are verified.

 An entry is made on the DD payable register, and the voucher is made.

 The DD credit is attached with the vouchers and posted at the computer.

 When DD is received, the test number is checked, and the payment is made.

 The vouchers are given for posting. And the payment is made.

 The vouchers are given for posting. And the entry that was made in register is closed.
i.e DD payable is nil.

Telegraphic Transfer or Mail Transfer


A telegraphic transfer is a fastest and safest way to transfer money. The message is fixed. Mail
transfer is Sowa than a T.T. the transfer is through mail. But now a days it is less used
instrument.

Issuance Procedure
 The request for maintenance through T.T is taken on the standard printed from.

 The customer fills it and signs it.

 The Head and remittance department checks it; the charges such as commission, tax and
telex as per effective schedule and sign it.

 If he fills the tax exemption form then no tax is levied.

 Then a neat T.T is made on the white slip. There are 3 copies. The original faxed to the
branch, one to the Head Office and one are kept as record.
 The entry is made in the TT issuing register.

 When commission bill is received, it is attached to the T.T office copy in the file.

Payments Procedure

 When a T.T arrives, the test numbers are checked and the signatures are verified.

 The entry is done in the T.T payable register.

 If there is no account then the T.T receipt needs revenue stamps and then the payment is
made.

 The T.T receipt is strictly non-negotiable.

Pay Order
It is a cheque drawn by a bank on itself. Pay order is an instrument in which three parties are
involved: purchaser, bank and receiver. It can be purchased by any customer. It is usually made
by Govt. Bodies. A single bank is included in this case.

Issuance
The standard form is given to the customer; he fills in the detail and signs it.

 The concerned staff checks the form. Charges as per effective schedule are applied.

 The cash of the pay order is received.

 A cost memo is signed, stamped and handed over to the applicant as a receipt.

 Then the pay order receipt is filled accordingly.

 Counter file is also filled.

 An entry is made in the pay order issued register.

 Then the authorized office after checking the pay order signs it.

 The pay order is then handed over to the application after obtaining his signature on the
P.O form.

 A voucher is also made and posted at the computer Cr. bills payable account P.O issued.

 On presentation of the pay order receipt the receipt is signed by two authorized officers
of the branch.
 The P.O entry is made in the P.O issued register.

 Then the amount is credited to the account of the customer or paid in cash.

 The P.O is posted at the computer.

Pay Slip
It is an instrument used by the banks for its payment. The slips are issued to the employee of the
banks their bills and invoices. The bills are transferred to pay slips. In this case only one bank is
involved and that is the issuer as well as the payer.

 Procedure prescribed for P.O for issuance and payment is followed for pay slips with the
following expectations.
 Pay Slips are the issued by the bank for the settlements of this down payment

 No excise duty is applicable on P.S.

Issuance Procedure
 A credit voucher is sent from the account department to the remittance department.

 The Pay Slips books is taken out and filled according to the credit voucher.

 It is entered in the P.S/P.O register.

 An authorized officer, AVP, signs it.

 The Pay slips are handed to the customer.

 A voucher made and posted payment.

 The P.S. is received on the counter, clearing or transfer.

 On receiving the P.S. if it is transferred in the P.S. register.

 The payment is made and the P.O. is posted at the computer.

 If Askari branch is in that city, the OBC forwarding schedule in sent to that Askari
Branch. Otherwise it is addressed to the particular Branch to whom the cheque belongs.

Charges of Remittances
 Issuance of DD and TT 0.13% or Rs. 135/- Minimum (Upto Rs. 100,000)

 Issuance of DD and TT 0.095% or Rs. 275/- Minimum ( Rs. 100,001-1,000,000)

 Issuance of DD and TT 0.080% or Rs. 1300/- Minimum (Over Rs. 1,000,000)


 Cancellation of DD Rs. 200/- (Flat)

 Duplicate issuance Rs. 300/-(flat)

 Pay order cancellation Rs. 300/- (flat)

 Issuance of Pay order Rs. 65/-(flat)


Online Funds Transfer
Online banking means that the customer of Askari Bank can deposit/ withdraw funds in / from
other branches of Askari Bank. You can transfer funds online from Askari to Askari all the
branches.

Charges
 Withdrawal Upto Rs. 1 million Rs.120/- (Flat)

 Withdrawal Over Rs. 1 million Rs.0.070%/- (Flat)

 Deposit Rs.320/- (Flat)

 Inter-branch online Transfer Rs. 185/- (Flat)

Lockers
Askari Bank offers facility of lockers to its customers. There are five types of lockers: Small,
Medium, Large. Extra large (16*16), and Extra extra large XXL (16 * 31 inches)

Charges
 Small Rs. 1,300/- p.a

 Medium Rs. 1,800/- p.a

 Large Rs. 3,200/- p.a

 Extra large Rs. 4,000/- p.a

 Extra Extra Large Rs. 6,375/- p.a

 Key Deposit Rs. 1,175/- per locker

 Breaking Charges Rs. 2650/- per locker plus actual charges of supplier

 Late Payment charges Rs. 135/- per month

ATM Card
Askari Bank offers ATM Cards (ASKCARD) for its customers’ convenience. Automated Teller
Machine is a hi-tech. invention in the field of the banking, it facilitate that a depositor can
withdraw money at any time without the need of banking personnel. We can also deposit money
with the help of this machine. But it is not so much practiced here because of some drawbacks.

Terms and conditions for issue of ATM card


In these terms and conditions, “Cardholder” means the individual to whom the ATM Card
(ASKCARD) is issued; “Bank” means Askari Commercial Bank Limited and “Bank Account”
means the account of the Cardholder maintained with the Bank.
1. The issue of ATM card (ASKCARD) entitles the Cardholder to avail the facilities of the
Bank’s Automated Teller Machines (ATMs) also referred to as machines.
2. It is a condition of issue and use of the Card that the Cardholder maintains a Current or
PLS-SB Account with the Bank at one of its branches in Pakistan. In the event of the
stopped for any reason, whatsoever the Card shall immediately be returned to the Bank
by the Cardholder and its validity shall cease to have any effect on the date of such
closure of A\C henceforth.
3. The card shall remain the property of the Bank at all times. The bank may, at its sole
discretion and without prior notice, cancel or refuse to re-issue or renew the card or
suspend its use for the time being and call for its return at any time, in which case the
Cardholder shall immediately return the Card to the Bank.
4. The cardholder shall be responsible for the payment of any taxes, duties, levies, which
may be attracted, to payments related to the issuance and use of the card by the
cardholder.
5. The cardholder undertakes not to disclose his/her Personal Identification Number (PIN)
to any other person. In the event of the PIN becoming known to someone other than the
cardholder, that person may be treated by the Bank as an acting agent of the cardholder.
The Cardholder indemnifies the bank against all losses or damages which may occur as a
result of the PIN becoming known to anyone else from any source whatsoever.
6. The bank shall not be responsible for any loss or damage arising directly or indirectly
from any malfunction of the Card or ATM or any technical or non-technical defect or
breakdown of the machine and/or any part thereof or the temporary non-availability of
case in such machines.
7. Except as otherwise prescribed by law, ACBL shall have no responsibility or liability for
any act or omission or inability to perform any of its obligations hereunder which results
from any cause beyond ACBL’s control.
8. The Cardholder agrees to accept that any cash or instrument(s) delivered through ATM
with the use of Card shall be, for the all the purposes, at the entire risk and sole
responsibility of the Cardholder. The bank would hence be assuming no responsibility
whatsoever in this behalf. The Cardholder understands and accepts that the crediting of
account, as specified on the frontal side of the envelope, designed for the purpose, will be
subject to:
i. In the case of Cash Delivery: Upon physical checking and verification of the
currency note(s) that would be found contained in the envelope, and confirmation
of the correctness of the particulars mentioned on envelope.
ii. In the case of delivering the Instrument(s): Upon checking and confirmation of
the correctness of the particulars of instrument(s) that would be found contained
in the envelope and after its clearance and/or realization of its proceeds through
lodgments in collection as per procedure.
9. The physical checking and verification of cash so delivered shall be carried out by the
Bank through its two officials, whose count, checking and findings will be accepted by
the Cardholder as correct and final. The Cardholder also expressly waives its rights to, in
any way, question or challenge the same.
10. The amount stated on the ATM screen or on the printed transaction record/slip shall not
for any purpose whatsoever be takes as conclusive of the status of the Cardholder’s
account with the bank.
11. The Cardholder further undertakes to accept full responsibility for all transactions made
by the use of the Card whether or not made with his/her knowledge/authority or consent
and he/she shall accept the Bank’s record of transactions as binding for all purposes.
12. The Cardholder shall take every possible due and proper care to prevent the Card from
being lost, mislaid or stolen and shall not pass the Card to any other person. He shall
notify the Bank immediately if the Card is lost, mislaid or stolen or if it comes into the
hands of a third party.
13. Where oral notice or loss or theft of Card is given, it must be simultaneously confirmed
in writing to the Card issuing branch of the Bank and proper acknowledgment obtained
thereof.
14. The Cardholder accepts all debits made to his/her Bank Account arising from the use of
the Card without limitation, (except after written notice of loss has been acknowledged
by the Bank) including any debits on account of fraud, forgery, pilferage or otherwise on
the part of the Cardholder.
15. The Cardholder agrees to pay and authorizes the Bank to debit his/her Bank Account, as
the case may be, with all charges, rates, etc., as may be applicable/due on account of
issuance of ATM Card (ASKCARD), its renewal/re-issuance and other ATM based
facilities, as the case may be.
16. The Cardholder shall ensure to keep sufficient credit balance in the Bank Account to
which the Card relates before making any withdrawals. If for any reason the account gets
overdrawn by the use of the Card, the Cardholder authorizes the Bank to charge markup
and/or service charges at the prevailing rates, on the amount remain outstanding.
Cardholder shall be responsible for immediately making up the deficit. The bank is
authorized to cancel the Card and/or demand the overdrawn balance together with mark-
up & liquidated damages.
17. The Bank reserves the right at any time or from time to time to reduce or increase the
total cash sum allowed to be withdrawn by the Cardholder from the ATMs through a
transaction, during any period.
18. The Bank’s record of any transaction generated electronically or otherwise shall be
conclusive evidence of such transaction.
19. The bank reserves the right to add/amend these terms & condition, at its sole discretion,
which shall be binding on the Cardholder.
20. This Agreement shall be governed, interpreted and enforced in accordance with the Laws
of Pakistan.
21. The bank is authorized to make all such enquiries that it may deem necessary in
connection with the ATM card application.
22. In the event that any one or more of the provision set out here in above shall be held by a
court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, the
validity, legality or enforceability of the remaining provision shall not be affected or
impaired thereby.

ATM Charges
 Issuance of ATM Card Rs.425/- per card

 Issuance of supplementary ATM Card Rs.425/- per card

 Service Charges on half year basis Rs.215/- per card

 Replacement Rs.425/- per card

Credit Cards Department


Credit Card is card that identifies its owner as one who is entitled to credit when purchasing
goods or services from certain establishments. Most of the work involved in credit card
operations is now handled by computers.
The bank is already offering credit cards like Master Cards international in collaboration with an
international financial service organization. In order to enable them to render more personalized
services, they have financial arrangement to offer master cards international directly to their
customer.
Askari Bank offers Credit Card in the form Askari Master Card. It has further divided into four
types:

 Awami Card

 Classic Card

 Gold Card

 Plantinum Card

These are the four types of Credit Cards issued by the Askari Bank to its customers. These have
the different credit limits and securities, and also offers advance loans on those cards. But the
advance money leads more charges than the limit. These are further discussed in the product and
services section.
Charges of Credit Cards

 Awami Card Rs.550/- as processing fee and no annual charges

 Classic Card Rs. 2,350/- per annum

 Gold Card Rs. 4,450/- per annum

 Plantinum Card Rs. 5,300/- per annum

Credit Department
The earnings of a commercial bank are chiefly derived from interest charge on loans and
discounts it is there necessary to consider the position of a banker with regard to loan advances.
The profitable uses which banker with regard and advances. The profitable uses which bankers
in the country make of their funds may be classified as follows. Head of credit department in the
main branch Lahore is Mr. Nadeem.

 Call loans and repayable at short notice.

 Investment in Government and other stock exchange securities.

 Purchase and discounting of bills.

 Loans and advances.


Lending Policies
This policy statement sets out the principles for Board of Directors who will determine credit
activity of Askari Bank. The Board of Directors delegates authority to Credit Committee to
approve, to direct, and to review commercial lending of Askari Bank to ensure its efficiency and
effectiveness.
The purpose of this policy statement board which are the implemented by the credit committee.
The policies are defined under the following headings.

Credits policies & contract guidelines


 Directors determine the commercial credit activity of Askari Bank

 Delegation of authority to credit committee

Credit Policies are as follows

 Credit principles

 Credit portfolio limits

 Credit Review

 Credit approval

 Credit administration

 Credit monitoring

Credit Principle
The following principles are to be adopted for lending authority, approval, monitoring and
control on a basis consistent with ABCL’s operational objectives and business stages.
1. Objectives

 Provision of suitable credit services and products

 Extension of credit is out compromising the rules and regulations

Transactions, which don’t apparently exhibit adequate commercial consideration, will not be
undertaken accept when authorized by the credit committee/president.
2. Structure
The authority structure should enable effective adoption to changes in the economical,
technological regulatory and competitive environment.
3. Performance

The education and admission of the loan portfolio should contribute with in defined and
acceptable risk limitation toward attaining satisfactory return on the bank’s capital. Credit
advancement shall focus on the development and enhancement of customer relationship and are
measured on the basis of the net yield for each customer relationship where individual
transaction should also be profitable.
4. Administration
The administration of the loan process should insure compliance with all laws and regulations of
regulatory authorities and the credit policy of the Askari Bank. Lending where repayment and
performance on mark up or profit servicing deteriorates are identified at early stage and closely
monitored by the branches to avoid loan losses. Loan facilities and related security are closely
and regularly monitored by separate unit unconnected with the credit approval process regularly
in order to access the collectability of the loan portfolio and effectiveness of the security.

Credit Portfolio Limit


The nature of the credit portfolio is governed by guidelines set down by the credit committee
from time to time, which are in keeping with local regulatory requirement. These guidelines are
consistent with overall Askari Banks’ limits.
1. Total Facilities
The aggregates of all the facilities shall confirm to regulatory requirement as specified from time
to time.
2. Term Facilities
Aggregate term facilities for more than one year should not exceed 30% of credit portfolio. Any
facility for more than one year shall require prior approval of the credit committee.
3. Unsecured Facilities
The aggregate of all advances to a single person should not exceed than the guidelines stipulated
by the regulatory authorities.
4. Secured Facilities
Security accepted as collateral for credit facilities are properly valued by approved surveyors.
Appropriate margins of security are taken in accordance with not only local regulations and
practice but such margins should also reflect disposal costs and potential price movement of the
underlying assets.

Credit Review
All limits are subject to at least an annual review and where necessary branch managers will
forward half- yearly reviews. This review function is the responsibility of the branches that will
submit periodic reports to the credit division immediately notifying any change in environmental
factors. The changes are assessed on expiry of limits or reassessed before the scheduled periodic
review whenever necessary.

Credit Approval
The primary individual factor determining the quality of the bank’s credit portfolio is the ability
of each individual, counter party to honor, on a timely basis, all credit commitments made to the
bank. This must be accurately determined by the authorizing credit personal prior to credit
approval.
The credit approval process must be as follows:
1. Authority
Credit are extended in accordance with the authority levels approved/ delegated by the Board of
Directors from time to time; provided credit approval is required at short notice rather than that
at normal span, the proposal may be referred directly to the credit division. The credit division
has authority with the agreement of a quorum of the members of with the appropriate credit
committee, to extend the loan.
2. Documentation
It is the essential that the proposal defines clearly the purpose of the facility, the source of
repayment, the agreed repayment schedule, the value of security and the customer relationship
consideration implicit in the credit division.
The security to be accepted as collateral for the facility and all documentation relating to the
security of the facilities must be in the approved form. All approval procedures and required
documentation must be completed and security is perfected, prior to the disbursement of the
facility.
3. Credit Risk Assessment
It is necessary to have a detail and complete credit risk assessment for each facility. Customer
relationship must not be over emphasized. It is the absolute responsibility of the proposing
officers and the branch managers to ensure that all necessary proposal documentation is collected
before the facility request is sent to the credit division or committee.
4. Prevention of Criminal Use of Banking Channels
The branch manager shall ensure that all credit facilities being proposed, every efforts has been
made to determine the true identity of a customer and in case of each transaction the source of
funds is established. The relevant Prudential Regulations applicable must be compiled with
before forwarding credit applications to the approved authority.

Credit Administration
The principle elements of credit administration are as follows:
1) Credit approval
2) Credit maintenance
3) Facility evidence maintenance
4) Credit monitoring and review

Objectives of Lending
In the modem economics, more than 90% business concern raises their funds from various
financial institutions to meet their multifold transaction. Actually it is very difficult for the
modem businessman to run his business on a huge scale solely. He has to float his shares to the
public or knock the doors of financial institutions, for example Bank. The most easy way to
make fund available to seek assistance by such agencies including Banks which have got surplus
funds and will to come to the assistance of producing units, and distributing units, and
exchanging units. This is the primary factor which toads towards lending of money by Banks. No
doubt, we cannot neglect the second factor profit orientation while running the credit business,
the single way for the bank to earn profit lies in lending money to the customer on comparatively
higher rate to mark-up that it gives to the depositors.

Principles of Lending
Apart from the instructions and directives sent by the state Bank of Pakistan, Muslim
commercial Bank, Ltd. Guided by three basic principles of profitability, safety, and dispersal.
1. Profitability
The management of Askari Bank is very careful to seek advances where advances can generate a
higher return. Bank has to spend huge amounts on establishment, payment of profit to depositors,
salaries of the staff, other variable expenditure and to provide a fair return to the share holders, it
must therefore, earn profit.
2. Safety
Safety principle is very important. No one will take a risk of losing the principle in order to earn
profit. So bank will prefer to lend at lower rates than to risk his money for higher rates. For
making his advances safe, a bank selects his borrowers cautiously. Safety does not necessarily
mean the taking of security. It would be wise, not to lend however, good the security be if it is
clear that it will have to be realized for clearance the debt. Safety also employs the borrower's
ability to reply without difficulty. Another aspect of safety is the lenders legal right to claim
repayment from the borrower.
3. Liquidity and Disposal
In its simple definition liquidity means the easy convertibility of an asset into cash. But when we
speak of liquidity in relation to advances, it is rather different; it means the adjustment of
advances at a short notices. Bank advances are made in such a manner that they are repaid in
reasonable period so that the bank can make new advances. Dispersing the advances in
reasonable amount over a large number and types of borrower is necessary to avoid bid debt,
stick up by single or few borrowers. It is therefore, necessary to advance moderate sums to a
large number of customer engaged in different types of industries.

Selection of Borrowers
The selection of a reasonable and trustworthy borrower is complicated and at the same time very
sensitive task which requires decision-making power from the bank employees. In the words of
the manager of a branch of Muslim Commercial Bank, Ltd. "Good selection of borrowers does
the half task in the profit of the Bank.’Bank do not through money away but every application is
tested carefully before being sanctioned.
To assist the Branch manager in this test, bank provides a performed, outlining the manner in
which a proposal should be put forward for consideration. If any specific information that is
required is not mention, it affects the proposal as a whole, making it appear weak or
inconvenience, it is therefore, necessary for credit officers to see that all relevant questions
following are, as far as possible completely and exhaustively answered.
Following are 6'C, S and 3P's, which are considered before lending:
1. Character
The bank get to know the customer we!! And be able to judge his intentions, for the bank shall
be entering into a contract with him involving the financing of his business. It is, therefore,
common and business senses to make sure that the other party to this contract will live up to his
obligations, this factor, therefore, contributes significantly to the safety of the advances, as it
relates to the willingness to repay under all circumstances. Particularly adverse circumstances.
Are the partners or directors of the business unit, which is seeking finance, persons who can be
relied upon as regards details of their proposal as well as promise of repayment? What is their
reputation in the market place for meeting their commitments in respect to prices & delivers to
purchasers and timely payment to their trade creditors? Confidential and tactful inquiries from
wholesalers, suppliers and other bankers are necessary to obtain this essential information.
2. Capacity
This factor relates to the ability of the borrower to manage his business successfully. Do they
have the necessary management, accounting and technical skills? And the degree of experience,
in the particular line of business for which the finance is required, to utilize the advance
productively and profitably, so that repayment is possible, along with our share of the profits?
This ability can be judge from the trading results. A study of the company's audited financial
statements for the past few years would real whether sales have deep growing, stagnating or
declining or declining. Similarly, the trends of gross & net profit margins indicate the
profitability or other wise of the business. The efficiency of the management can be Judge from
the turn-over ratios, collection of receivable and management of accounts payable.
3. Capital
The proportion of the borrower's own resources to the amount of finance is requested, is the next
point to receive the branch manager's attention.
Is the amount required in proportion to the borrower's capital and contribution to the project? Is
it within the powers of the borrower? In the case of a corporate customer, a check on the
memorandum & articles of association is necessary to ensure it is within prescribed limits. If the
amount describe to be borrowed is too large. Under the circumstances, can it be sagely reduced
to an acceptable & practicable level? Past experience has taught bank that it is unwise to lend
more than is actually required, as it sometimes has led to speculative uses of the surplus.
4. Cash Flow
The source of repayment should be ascertained at the beginning. As commercial banks, bank
advances must, be largely confirmed to provide short" term finances to business customer. Hence
financing the current assets of traders and manufactures. Would ensure that repayment would
normally come from the sale of inventory and the realization of account receivable of our
customers. If we are confident of the customer's ability to buy the right materials, at right
markets and be able to produce finished goods which can be readily sold, at a satisfactory profit,
there should be no doubt about repayment. Therefore, cash flow statements and profit projections
need to be submitted by the borrower and carefully evaluated by the credit officers.
5. Conditions
From quantitative and qualitative information the bank need, to examine the conditions which
the firm is operating. This requires identification of the factors that have up to now contributed to
the success of .the business, and to Examine factors change has recently occurred or is likely to
occur in the near future which will adversely affect the profitability and prospects of the customs.
Accordingly to nature and prospects of the customers' business need to examine will it continue
to prosper, or will additional competitors or new competitors with the latest technology result in
reduced profit margins? Is the product essentially required, in a wide market with continued
demand? The industry conditions and the firm's place in industry and its market share need to be
examined demand? The industry conditions and the firm's place in the industry and its market
share need to be examined. An important quality here is the management's tendency to look and
think ahead to anticipate and adapt to change by diversification or otherwise, which will instill
confidence in the banker. For this purpose, it is necessary to maintain & update at the time of
renewing the advances.
6. Collateral
Since the bank is lending money, which it has, received form depositors, the bank must ensure
that there is a second way out. Security is, therefore, taken as a form of insurance. In case the
business plans of the borrower, do not work out, due to circumstances or developments beyond
his control.
It is the final safe and credit officer should be able to identify appropriate assets, which would
most suitably serve as security, in the given circumstances. The qualities which constitutes a
good banking security are transferability i.e. whether a valid charge should be created by the
borrower over his asset in favor of the bank should be such that the bank can obtain a good title
with minimum formality and expense. Its value should be easily ascertainable and stable. It
should be easily realized, in case of nee. Finally security be obtained & formalities completed
before the finances is disbursed.
7. Purpose
Credit resources are scarce but have alternate uses- The unity's needs demand that banks put
them to the best possible for which the finance will be used, within the credit policy the bank? In
conformity with the country's laws, credit control and exchange control requirements. Is it a
desirable one from the economic and banking viewpoint? Is it for productive of emulate
purpose?
In short, they're in need to ensure mat the purpose is conductive & within the borrower's normal
sphere of business activities and scale operations.
8. Period
Short-term advances are favored that is for not more than a year, renewable each year, if still
justified. Accordingly the most usual purpose is to assist manufacturing and trading customers in
their need to purchase current assets in line with their production or trading cycle, and seasonal
loans for agricultural purposes.
Being a developing country, EBI do grant medium-term loans but to a limited extent, for the
fixed- asset financing need industrial customers.
Urgent Approval
In exceptional circumstances if an approval is required at short notice, outside of the normal time
scales for approval, the proposal is referred directly to the Credit Division at Head Office.
All such referrals are accompanied by a priority decision request. The Credit Division with the
agreement of a quorum of the members appropriate Credit Committee, will advise approval for
the proposed facility. All such approvals, together with appropriate supporting documents, are
submitted to Credit Committee or Board for Information and post factor approval at their next
regular meeting.
Renewals / Review
The reviews/renewals of Credit line Proposals would be on half yearly basis or as per the original
sanction advice, and shall pass through the same process and levels as for the original proposal.

Types of Advances
i) Funded advances
ii) Non funded advances
1) Funded Advances

Funded advances are those advances in which funds of banks are involved.

Funded Advances

Term 1. Term Finance


Finance Revolving Facility
Main features of term finance are
i) It is for proper time period. May be of one year, two year, and three year.
House building finance is including in term finance.
ii) Account will be debited only once adjustments are possible further but account
will be debited only once.

Term Finance

Clean Secured
i. Secured Finance
Financing against Govt. securities i.e. price bonds, defense saving certificate.
Documents Required
L/C, Demand promissory note, L/G
ii. Clean Finance
These funds are extended against personal guarantee for salaries people.
Documents Required
LC of Govt. salaries personal, letter of guarantee
2. Revolving Facilities

Proper limit is facility is called summing.


Types of Revolving Facility

i) Running finance
ii) Cash finance.
i. Running Finance

It is extended the business community and Govt. enterprises.


ii. Cash Finance.

Cash finance against tangible securities.


2) Non Funded Advances

Non funded advances in which bank funds are not involved e.g. L/C, L/G.
Preparation of Spread Sheet
The spreadsheet are prepared for a series of financial statements (say 3-4 years) since it provides
useful comparisons and sets out trends over the period which are of immense importance in
evaluating the financial strength and repayment capacity of the business enterprise. Notes to
audit accounts must also be studied and incorporated in the spreadsheet.
According to prudential Regulations every bank shall as a matter of rule, obtain copy of account
relating to the business of the borrower for analysis record in the following manners:
1. Where the bank's exposure does not exceed Rs.2.00 million the borrowers duly sign
Accounts.
2. Where the exposure exceeds 2 million but does not exceed Rs. 10 million, the Accounts
are duly signed by the borrowers and counter signed by the Internal Auditors of the
Branch or Chartered Accountants.
3. Where the exposure exceeds Rs.l0 million, the Accounts are duly signed by the practicing
Chartered Accountants.
Spread Sheet Main Features
The main feature of spreadsheet and the guidelines to prepare the same are given bellow:
1. Name
2. Location
3. The principal place of Business.
4. Amounts in
5. Use figure in thousands to permit recording of all significant amounts.
6. currency
7. Insert the currency of the amounts Pak Rs.
8. Auditor
9. If audit account, the name of the auditor
10. Audited or unaudited
11. Unqualified or Qualified
12. Date
13. Credit Report
A credit report is the report about a party at branch level consisting of necessary information to
assess net worth of the party. It is concise but comprehensive and contains he following
information

 Name and Address.

 Date of Establishment.

 Date of Account Opening

 Nature of Business.

 Experiences in the line of business.


 Past performance and present status.
Foreign Exchange Department
The FOREX department works effectively with an extensive correspondent network and deals
with import, export and foreign remittances. The detail is as follows:

Import Section
In case of import, first a L/C is opened in the bank on behalf of importer. Importer submits a
request for opening a L/C and prepares an application form. The importer seeking to open a L/C,
must be registered with Export Promotion Bureau, it is the basic requirement.
A documentary letter of credit can be defined as:
A conditional guarantee given by a bank to named beneficiary (seller of goods), to make
payment for the goods dispatched by him to the buyer, against presentation of the called for
documents and compliance with all other terms and conditions of the credit”.
Types of Documentary Credit
1. Revocable credits
A revocable credit may be amended or cancelled by the issuing bank at any moment and without
any prior notice to the beneficiary. The revocable credit is completely ended in Askari now days.
2. Irrevocable credits
An irrevocable credit is one, which neither can be cancelled nor can be amended without the
issuing the bank, the confirming bank if any, and the beneficiary.
3. Confirmed credits
All credits, whether revocable or irrevocable, are advised to the beneficiary without any
engagement on the part of the advising bank, although they do include an undertaking of the
issuing bank to cover the negotiation of correct documents, if they are presented. However, such
an undertaking of the issuing bank does not bind the advising bank at all that it will also
definitely take such action for the simple reason that the undertaking to beneficiary is solely of
the issuing bank. The advising bank may refuse to pay, accept or negotiate the documents,
though correctly tended by the beneficiary, for any commercial, economic or political reason,
prevailing at that time, under which the bank feels that it would not be possible to obtain
reimbursement from the issuing bank, for the money paid to the beneficiary.
Therefore, to avoid this risk, the beneficiary may ask the importer to provide him a
guarantee from a bank operating in his country, preferably his own bank, to the effect that
against presentation of correct documents by the beneficiary, the payment shall be made to him
immediately “Without Recourse”. In such cases, the issuing bank requests the advising bank to
provide the desired undertaking/guarantee to the beneficiary. This guarantee is in addition to, and
not in substitution for, the undertaking already given by the issuing bank.

4. Red clause or packing credits


“A Red clause Credit” is one which contains a special clause, authorizing the advising or
confirming bank to make advances to the beneficiary, enabling him to manufacture or purchase
the goods required to be exported under the credit. In other words, a red clause credit is a “Pre-
shipment advance” to the exporter. The amount of advance, which may be up to 100% of the
amount of credit, is clearly specified in the credit.
5. Revolving credits
A revolving credit is one where, under the terms and conditions thereof, the amount of the credit
is automatically renewed or reinstated, without specific amendment to the credit, after each
drawing.
A Revolving Credit may revolve either in relation to “Time” or in relation to “Value”. A
credit, which revolves in relation to time, is a more useful and practical instrument. For example,
a revolving credit can be made available for Rs.50000/- on monthly basis, with an overall
validity period of six months. In this case, the beneficiary can present the documents for
Rs.50000/- only, in a month, irrespective of the fact whether or not he has drawn any sum during
the previous month. Thus total liability on account of negotiation of documents under the credit
will not exceed Rs.300000/- in any case. However, such credits may be issued either on
“Cumulative” or “Non-Cumulative” basis. If the credit is Cumulative, the amount not utilized
during one month can be carried forward and made available in the following or subsequent
months. However, in case of “Non-Cumulative” credit, any short falls in drawings in a particular
month are cancelled and not carried forward to the next or subsequent months.
6. Transferable credits
A credit may be “Transferable” only if it specifically indicates so. The transferable credit is
usually established when the first beneficiary is not in a position to supply the goods himself, and
wishes to transfer a part or all of his under the credit to one or more beneficiaries, who are
willing to supply the goods.
7. Back-to-back credits
When a credit is not “Transferable”, and the beneficiary is also not in a position to supply the
goods himself, he approaches his bank to issue a fresh credit on his behalf in favor of another
beneficiary, who is willing to supply the goods. As a consequence, the beneficiary of the
original/first credit becomes the applicant of the “Second Credit”, who is responsible for
reimbursing his bank for all payments made under the “Second Credit”, regardless of the fact
whether or not he himself is paid under the “First Credit”. Diagram shows back-to-back credit:

Procedure for opening letter of credit


General consideration
1. Letters of credit are normally opened against prior sanctioned limits. This limit is decided
by the credit department of any bank. However, where prior sanctioned limit is not
available, the branch first submits a CLP to the competent authority.
2. Appropriate margin against letter of credit as prescribed in the LC limit is recovered prior
to opening of letter of credit.
3. Where the amount of credit is Rs.5, 000, 000/- or above, credit report of the beneficiary is
also obtained before establishing the letter of credit. The charges of this report are
recovered from importer.
LC Application
a) Application is made by the importer on the bank’s standard form AB FE 201.
b) In case of guarantee, the guarantor signs the clause printed at the foot of the form on the
reverse.
c) The signature of both the applicant and guarantor are verified. The application form
should bear special adhesive stamp of appropriate amount.
d) The application should be filled by the importer himself.
e) The instructions in the letter of credit should be precise and free from any ambiguity.
f) The blank spaces in the application must be completed and alteration should be properly
authenticated under the signature of the opener.
g) Details of every LC opened must be recorded in the Category Post Book in the past. In
the cases where original category Pass Book is in the custody of some other bank,
attested copy of category Pass Book and NOC is obtained from that bank before opening
any LC and that bank is of details of LC opened.
Documentation
i) Indent/Performa invoice/firm order
ii) L/C opening form
iii) I-form
iv) Appendix B
v) Request on the company letter
vi) And other conditions mention in the L/C form
How to establish a Letter of Credit?
Documentary Letter of Credit can only be opened by branches authorized to deal in foreign
exchange. The branches, which are not authorized to deal in foreign exchange, submit their
customer’s application for opening letter of credit duly completed and signed in all respect along
with all other documents to the nearest authorized branch.
After completion of the above formalities the opening should proceed further as under:
1) Foreign currency amount is converted into Pak Rupee, at TT/OD selling rate.
2) The names of advising and reimbursing banks are from the International Division.
3) Margin, commission, postage and cable/telex charges (if LC is being opened by
cable/telex) are calculated. If the LC is being opened on behalf of an authorized branch it
is ensured that margin as prescribed by SBP/Head Office has been fully recovered, where
as the commission on LCs of unauthorized branches is shared equally by the opening
branch and the forwarding branch.
4) Full particulars of the LC recorded in the LC opening register.
5) Separate folio is allotted for each customer in this register and necessary entries for LC
liability and margin are recorded at the time of opening of LC.
6) Vouchers are passed on the same day.
7) After that L/C send to CFTU (Centralize Foreign Trade Unit) and CFTU further precede
it to SWIFT (Social Worldwide Interbank Financial Technologies).
8) SWIFT send this L/C to Exporter.
Amendments in Letter of Credit
An irrevocable letter of credit once communicated to and acted upon by the beneficiary cannot
be amended without the consent of all parties concerned with LC. Such a credit can only be
amended or cancelled with the consent of all parties, i.e., the opener, the beneficiary, the opening
bank and the confirming bank (if any). All the amendments must be within the Exchange Control
Regulations in Pakistan.
Types of Amendments:
Usually the following types of amendments may be needed
1. Verifying the signature of the opener of the LC, whenever a request for amending the
import LC is received.
2. Checking that amendment is in accordance with the International Rules and Regulations.
3. If the amendment involves any increase in the amount of LC, it is acceptable only if it is
covered within the prior sanctioned limits of the party.
4. In case of extension of date of shipment/negotiation it should be ensured that the
amended date is not beyond the validity of permissible period.
5. If the change of beneficiary is requested in letter of credit by the opener it should be
proved by documentary evidence, e.g., the original letter from the beneficiary showing
his inability to ship the goods or new contract of sale.
6. If the seller and purchaser subsequently decide to change the mode of shipment, such
type of amendment can also be incorporated in letter of credit. This amendment is also
incorporated in insurance cover note/policy.
7. Sometimes partial shipment or transshipment is requested by the importer. This type of
amendment requires change in insurance cover/policy.
LC sight

 Documents are received

 The documents are verified as per covering schedule.


 A scrutiny sheet is prepared and all discrepancies are recorded.

 In case of discrepancies, an advice is sent to negotiating bank with intimation to importer.

 After that negotiating bank contact with the importer, ask the importer to accept the
discrepancies until such time they are held on risk and responsibility of negotiating bank.

 On receipt of instructions of importer/negotiating bank regarding acceptance of the


discrepancies/payment instructions further action is accordingly taken.

 If the issuing bank refuses to accept the documents it must give reply to, by any fastest
means of communications (usually fax machine is used) to the negotiating bank or
remitting bank (or to the beneficiary if it received documents directly from him), the
issuing bank shall then be entitled to claim from the remitting bank refund of any
reimbursement which have been made to that bank.

 The documents are lodged in PAD register when all documents are in order and running
PAD number is marked on all documents under bank’s stamp.

 An advice is sent to importer along with I-Form to be signed and then returned.

 TT/OD selling rate prevailing on the date of lodgment to be maintained on the covering
schedule along with date.

 If forward exchange has been booked and documents are received within the validity
period then the bill amount is to be converted into Pak Rupees on booked rate and
forward contract is set off. However F.C. charges are converted on TT/OD selling rates.

 The vouchers are prepared and are posted. Vouchers are passed at the time of lodgment
of documents.
LC Usance

 Documents are received.

 The documents are verified as per covering schedule.

 A scrutiny sheet is prepared and all discrepancies are recorded.

 In case of discrepancies, an advice is sent to negotiating bank with intimation to


importer.
 After that negotiating bank contact with the importer, ask the importer to accept the
discrepancies until such time they are held on risk and responsibility of negotiating
bank.

 On receipt of instructions of importer/negotiating bank regarding acceptance of the


discrepancies/payment instructions further action is accordingly taken.

 If the issuing bank refuses to accept the documents it must give reply to, by any
fastest means of communications (usually fax machines is used) to the negotiating
bank or remitting bank (or to the beneficiary if it received documents directly from
him), the issuing bank shall then be entitled to claim from the remitting bank refund
of any reimbursement which have been made to that bank.

 An advice is sent to importer and bill of exchange and I-Form is presented to importer
for signing and then returning.

 On receipt of signed bill of exchange, customer’s account is debited by the document


value being the stamp duty. Then the Treasury Department is advised about the
maturity of the date.

 Acceptance numbers are allotted and the details are entered in register duly marking
the maturity dates.

 The documents are lodged in PAD register when all documents are in order and
running PAD number is marked on all documents under bank’s stamp.

 The documents are delivered after endorsing bill of exchange to customer.

 The vouchers are prepared and are posted.

 The negotiating bank is informed of the maturity.

 The client is advised three days prior maturity to keep sufficient funds in his account
on maturity.

 The payment is at maturity to negotiating bank duly informing the Treasury


Department.

 The vouchers are prepared and are posted.


Export Section
Export is another section of Foreign Exchange Department. It too generates income to the bank
as well as the country. In ACBL, it is operated by two persons.
Under the registration (import and export) order 1952 no person can export any commodity from
Pakistan unless he is duly registered as an exporter with the Export Promotion Bureau. But now
days this is not necessary. Bank should ensure that the exporter is registered with WPB before
certifying any export Form-E for him. The registration number should be quoted on the relative
export form.

Requirement of E-Form
Every exporter is required to furnish a declaration to customs authorities for the good being
exported. The declaration is submitted on a prescribed Form-E in quadruplicate, which is
certified by the authorized dealers.

Issuance of E-Form
1. E-Form in quadruplicate is issued to the exporter having an account with the bank
against written request. In case the exporter maintains an account at a branch other
than the exchange dealing branch, the request is routed through the branch, which has
the account within it.
2. Before issuing E-Form, it is ensured that the exporter has given the attested
photocopies of required documents such as Valid Export Registration Form, NIC, and
Challan copy of Renewal Fee Paid to the bank.
3. Credit Report of the exporter is also obtained to ensure the Credit Worthiness of the
exporter.
4. The set of E-Form after completion is then entered in the E-Form Issuance Register
and acknowledgment is obtained from the exporter or any authorized person of the
exporter.
5. Utmost Care is taken while issuing E-Form because it is the security document. Blank
E-Form is never issued.
6. If full details of consignment are not available, at least exporter’s name, address,
goods to be exported etc., must be filled in the E-Form.
Certification of E-Form
Before lodgment of E-Form to customs authorities, it is required to be certified by the
Authorized Dealers. When the quadruplicate set of E-Form is presented for certification that set
is very minutely scrutinized and following details are checked:

 Export Registration Number (is correctly mentioned on the E-Form).

 Signatures of the exporter or his authorized signatory are duly verified at the counters.

 All blank space in E-Form is correctly, legibly and properly filled in without any
overwriting.
After certifying the correctness of the E-Form, it is then entered in E-Form certification register
in the folio allotted to each exporter separately. Bank/Branch stamp is then affixed beneath the
certificate available and signed by the authorized officer. All the four copies of the E-Form duly
certified are delivered to the exporter or his authorized person.
Submission of E-Form
After certification of E-Form, all the four copies are submitted to the customs authorities for
clearance of consignment. Three copies of E-Form are returned by the customs’ authorities
retaining the original after endorsement of shipment on the relative portion on E-Form. The
quadruplicate copy is retained by the exporter while the duplicate and triplicate copies are
submitted to the authorized dealers along with other documents for negotiation within 14 days
from the date of shipment. The bank retains the duplicate copy for its record while the triplicate
copy is surrendered to SBP on realization of proceeds.
Utilization of E-Form
E-Form is invariably utilized and received within 21 days from the date of certification or 14
days from the date of shipment failing which the exporter is persuaded to submit the form
without further delay. In case the exporter does not respond to the requests, the matter is reported
to SBP.

Cancellation of E-Form
E-Form is cancelled in two ways:

 If goods are not exported and E-Form is not presented to the customs’ authorities, the
same is surrendered to the bank for cancellation, which is recorded in separate file, duly
marked “Cancelled”.
 If E-Form has been in the hands of customs authorities but the goods could not be
shipped due to non-availability of space in ship or due to any other reason, the exporter is
required to submit three copies of E-Form along with original “Shutout Notice” duly
stamped and certified by customers to the bank. The bank submits all the three copies
along with “Shut out Notice” to SBP under a covering letter for cancellation and record at
their end.

Certification of E-Form in case of advance payment


Sometimes the exporter may receive payment for the item to be exported in advance
without waiting for the documents. In such a case the advance payment received for this purpose
is required to be declared by the exporter for such on the prescribed form “Advance Payment
Voucher”. A “proceeds certificate” is issued to the exporter for such payments which is required
to be produced at the time of certification of E-Form as well as at the time of presentation of
documents to the bank. Advance payment is certified of the reverse side of E-Form under the
seal and signatures of the authorized dealer, which is required for reporting to the State Bank of
Pakistan.

Negotiation
Negotiation is giving the value to the beneficiary for drafts and/or documents as distinct from
merely examining and forwarding them to the issuing bank.
Documents are submitted at the counters of negotiating bank along with the covering letter of
exporter after completion of shipment formalities. Documents contain, besides other documents
as per LC terms, the original LC along with all relevant amendments duly authenticated by the
Advising Bank. All documents are carefully scrutinized and are comply with the terms and
conditions of the LC. No documents should be inconsistent with each other or with terms and
conditions of LC.

Export Refinance scheme


State Bank of Pakistan introduced a “Refinance Scheme” for products in 1973 which was
renamed in 1977 Export Refinance Scheme. The purpose of this scheme is to boost export and
earns foreign exchange.

Salient features of the scheme


The finance shall be sanctioned by one of the scheduled banks for the exports of eligible items
only, both on pre-shipment or post-shipment basis, at concessionaire rates prescribed by the SBP.
State Bank of Pakistan sanctions limits to the scheduled banks to obtain refinance from SBP for
the finance made by them under the scheme. It is at the option of the bank to obtain refinance
from SBP or to finance the exporter from their own resources. But the bank shall not recover
markup exceeding the prescribed concessionaire rates. Finance allowed under the scheme is
exempt for calculation of per-party exposure credit ceiling and liquidity requirement.
The finance under the scheme is available for exports through banking channel for
I. Exports of all eligible items,
II. Exports of eligible commodities locally produced and supplied locally against
international tenders
III. Export of eligible commodities from the tariff areas of Pakistan to Export Processing
Zones in Pakistan, and
IV. All inputs/supplies by indirect exporters against export commitment of main exporter
under an Irrevocable Letter of Credit.
The scheme operates under two parts viz. Part-1 & Part-2. The maximum period of finance
allowed under Part-1 of the scheme, both on pre-shipment and post-shipment basis is 180 days.

Export Refinance under Part-1


Export finance is allowed for exports against a Letter of Credit or a Firm Contract. In case of a
LC name of the commodity and the amount of LC are noted but in case of the contract, full
details of the contract are noted and exporter verify the signature of buyer on the firm contract.
Sales on consignment basis do not qualify for refinance facility. Finance is allowed for total
period of 180 days inclusive of pre-shipment and post-shipment period. However, if the exporter
avails finance on post-shipment basis, it shall be for 180 days or the date of realization of
proceeds whichever occur earlier.
Documentation
Pre-shipment

 DP Note

 Undertaking (as per Annexure A of the said scheme) on non-judicial stamp paper

 Copy of letter of credit or firm contract/firm export order

Post-shipment
 DP Note

 Undertaking (as per Annexure A of the said scheme) on non-judicial stamp paper

 Copy of letter of credit or firm contract/firm export order

 Bill (s) of lading

 Invoices

 Duplicate copy of form (s) ‘E’

Procedure

 The party sent a request letter.

 The scrutiny sheet is prepared, the case is stamped with ACBL stamp and authorized
persons affix their signatures.

 The above mentioned documents are sent to SBP for approval.

 The FAPC number is entered into to the respective register.

 A separate file is maintained.

 On approval, SBP sends an advice to bank.

 On the 180th day SBP debits his balance and the bank’s account.

Export Refinance under part-2


An exporter avails of finance limit at the concessionaire rate in a financial year to half of the
export performance of eligible commodities made by him during the previous financial year. The
limit is available to the exporter on revolving basis. Where in outstanding balance on any date
shall not exceed ‘Half’ of the export performance. The exporter shall be required to repatriate
export proceeds of eligible items (excluding receipts from exports for which finance has been
obtained during the period) two times of the daily average of finance obtained by him during the
monitoring period.
Documentation

 Copy of Letter of Credit

 DP Note

 Undertaking (as per Annexure of the said scheme) on non-judicial stamp paper
 Form ‘EE’

 Customer’s invoices

 Bill of lading

Opening and maintenance of foreign currency accounts opening


1. All persons, firms and companies of local or foreign origin, whether resident or non-
resident, can open foreign currency accounts. All foreign currency account is interest
based and is not PLS based.
2. Accounts may be opened in any foreign currency.
3. Deposits are FC Accounts may be made in the form of cash, traveler’s cheques, FEBCs,
FDDs/FTTs etc.
4. Traveler’s cheques issued by banks/institutions operating in Pakistan whether local or
foreign cannot be deposited in Foreign Currency Accounts. However, T/C’s issued
against Foreign Currency Account can be deposited into foreign currency account. Now
the question arises that how it can be verified that a particular T/C is issued against quota
or F.C A/c. The answer is that T/C’s issued against quota “Not en cashable in Pakistan”
stamp is affixed on it. The quota T/C has to be surrendered against Pak. Rupees.
5. Banks or any other agency cannot inquire or raise any question about the sources of funds
deposited in foreign currency accounts by the customers. However, on few occasions
banks can disclose the secrecy of F.C. Accounts if (i) it is in the interest of the nation (ii)
in the interest of the bank (iii) Through court orders and (iv) Desired by Government
agency (Narcotic Control Board SRO).
6. Any amount, at any time, can be withdrawn from these accounts and there is no limit for
cash withdrawals.
7. Sale proceeds of goods exported from Pakistan, earnings of residents of Pakistan on
account of services rendered in Pakistan, earnings or profits of the overseas
offices/branches of Pakistan firms/companies/banks etc. are not eligible for credit to
foreign currency accounts.
8. State Bank of Pakistan has given permission to utilize the funds lying in foreign currency
accounts for adjustment towards export proceeds, short realized/not realized within the
admissible period.
Foreign remittances
The word “remittances” means transfer of finds from one place to another. It may be ‘inland
remittance’ or ‘remittance abroad’. Inland remittance means transfer of funds from one place to
another within national boundaries. While remittance abroad or foreign remittance means
transfer of funds one country to another.
Foreign remittance can either be inward or outward. In case of inward remittance, foreign
exchange flows in while in case of outward remittance, foreign exchange flows out. In banking
terms in case of inward remittances, authorized dealers purchase foreign exchange when it is
received in the forms of MTs, TTs, Drafts, Bills TCs and Foreign Currency Notes. In contrast,
when it is outward remittance, authorized dealers sell foreign exchange by issuing MTs, TTs,
Drafts, Bills, TCs, and Foreign Currency Notes.
Classification of inward remittance
Inward remittances mainly fall in one of the following five categories:

 Indenting commission

 Advance payment against exports

 Sale proceeds of exports

 Passage money

 Miscellaneous earning

1. Indenting commission
The remittance is received in favor of indenting agent in Pakistan, who negotiated/corresponded
sale on behalf of foreign exporter.
2. Advance payment

A Pakistani exporter may negotiate with a buyer abroad on the condition that full or part of the
sale proceeds may be remitted before shipment.
3. Sale proceed of exports
Sale proceeds of a Pakistani exporter are received in part in full as per terms of the Documentary
Credit or Firm Contract.
4. Miscellaneous earnings
The remittance is received for rendering any service to foreign customer/clients viz. Cost of
advertisement, fee of legal service etc.

Foreign Currency Department


 Foreign currency department perform the following functions:

 Foreign Bills for Collection (FBC)

 Foreign Telegraphic Transfer (FTT)

 Foreign Demand Draft (FDD)

 Inward Remittances

Requirement of the Funds Transfer


For transfer of the funds in the foreign currency, a person must have an account in foreign
exchange in the bank. Requirement of the account opening is $500 or any other currency
equivalent to $500.

Accounts Department
Accounts department is a department, which deals and checks all the activity of the entire
department. It also deals in expression of finance of the bank. Salary payment is also one
function of the bank.

Function of Accounts Department


1. Preparation of Daily Bank Position Statement
The department prepares Bank’s Daily Position. It is prepared by taking in to account two
computer printouts. The set of computer printouts is called End of the Day. The first job in the
morning is to prepare these statements, i.e., UNIDD 100 and UNIDD 170 are consulting while
making it.
UNIDD 100
A statement is showing the assets and liabilities or the position of the branch at the particular
date.
UNIDD 170 (Statement of the Deposits)
This is the statement showing the detail of the accounts. A statement showing the details deposits
in local currency and foreign currency. After preparing the statement, the officer who has made
the statement signs it and then Manager Operation counter signs it. Then it is fixed to Head
Office.
2. Checking Bank’s Daily Activity
Accounts department deals and checks the entire working of a branch; all the vouchers that have
been posted at the computer are scrutinized in accounts departments. The “End of Day”, i.e.
computer print is also received from the computer. The next day the activity is separated some
statements from the “End of Day”. Then next day activity separated some statements from the
“End of Day”. The vouchers are sorted out account type wise. Separate all the vouchers of
Saving, ASDA, BBA, Current accounts and GL. Then these vouchers are matched with the
entries in the Daily Customer Movement Statements.
An abnormality if occurs, is immediately dealt with. All the vouchers and instruction are checked
individually against the computer printouts. Then which entries are remain in the customer daily
report official compare these entries in the Transfer Register and write the type of the
transactions in front of it in daily customer movement report. After checking they are signed by
the in charge accounts department and the counter signed by the manager operations and keep
them in the store. These reports are checked when needed.
3. Payment of Salaries
Payment of salaries is also a function of the accounts department. Head Office provides the
salary schedules to each branch. According to the schedule are out on a “salary statement”. Head
of the accounts department check the schedule and calculate the salary of the each person in the
branch according to their scale.
i) Pay Structure
There are three types of pay structure.
Net Salary = Basic Salary +Allowances –Deduction.
ii) Basic Salary
It is a salary that is given by the head office according to the position of the person.
iii) Gross Salary
It is the salary that is obtained after adding the allowances in the basic salary.
iv) Net Salary
It is a salary that is left after adding in the allowances and deducting the provident fund and
deductions.
It is a tradition of an Askari Commercial Banks that the pay is dispatched on the 26 th of each
month all over Pakistan. The maintenance and record keeping of allowance is done the Accounts
Department
v) Allowances
All the employees are given from these allowances which are applicable.

 Medical Allowances is 10% of the basic pay. It is also cumulative in nature.

 The house rent allowances is 45%of basic pay.

 Electricity Allowances are 10% of the basic pay.

 Washing Allowances are Rs.60/- (for peons and drivers only).

 Special Technical Allowances are Rs.230 (to at computer, typing and cash).

 Group Insurance is 100% for every employee.

 Employee’s Old Age Benefit Rs. 60/ month.

 Annual increments.

 Performance Bounces.

 Leave Fair assistance.

vi) Deductions
 Provident Fund is deducted once from each person’s basic salary in one year. It is
also deducted from the employer’s account by the same ratio.
 Gratuity is 8.3370 of basic salary.
 Tax deduction if salaries are more than Rs. 200,000/ for men (Rs. 260,000/ for
women).

4. Preparation of the Statements


The accounts department prepares various statements and sends then to Head Office on monthly
basis. The monthly statement sends to Finance Division at Head Office are:

 Statements of Liabilities.

 Statements of Expenditure.

 Statements of sundry creditors outstanding.

 Statements of sundry Debtors outstanding.

 Statements of operations in sundry creditors during the month.

 Statements of operation in miscellaneous expenditure account during the month.

 Salary statement.

 Petty cash statement.

Statement No 4, 5, 8 and 9 manually prepared. The rest are computerized statements. The
monthly statements that are sent to the personal and administration division or HR Division at
Head Office are as follows:

 Salary Statements.

 Advanced Rent Statement.

 Maintenance of Bank Vehicles.

5. Access or Need of Cash


When at the end of the day branch has access cash then this access cash send to SBP and SBP
pay on it at rate of 11.7%. If the branch has less cash then the cash limit i-e e-g 4 Million then the
Accounts Department arrange cash from other branch or from other bank through SBP. Accounts
Department is also has the cheque book of SBP, if the Foreign Trade or Credit Department need
cash to pay creditors then head of accounts department fill a cheque of the required amount and
get cash from SBP.
6. Classification of Deposits
This statement is yellow and shows the classification in color of deposits according to the
following areas.
i) Nature of the deposit
ii) No. of the account
iii) Type of the deposits
iv) Categories of the deposit
v) Rate of the interest /profit

7. Classification of Advances
This statement provides the details of the advances. The advances are classified into various
categories:

 Nature

 Borrower

 Purpose

 No of account

 Security

 Managing Retained

 Rate of interest

 Amount

8. Classification of Bills Purchased and Discounted


This statement classifies the bills purchased and discounted according to:

 Nature

 Category of bills

 Amount

9. Classification of Investment in Securities and Shares


This statement reveals the area of the investment according to:

 Nature
 Amount

 Type of securities

All the elements actually provide clear pictures of the port of advances, deposits and bills
purchased. The accounts also deal in the express of the bank. The different bills are dealt with in
this department.
10. Depreciation Calculation
The depreciation of assets is calculated through “straight line method”. The depreciation is
calculated both manually and on the computer. All the accounting functions are organized by the
in charge of Account Department calculated the manually checks it with computer data.
Rates of Depreciation

 Furniture and fixtures 10% written down value

 Machinery and equipment 20% written down value

 Renovation 20% on the original cost

 Carpet and vehicles 20% on the original cost

 Others 20% on original cost

11. Maintenance of the Ledger


Although all the works have been done in the Accounts Department is computerized. But the in
charge of the account department maintains some ledger on manual basis. There are:

 Level Record Register

 Furniture and Fixture

 Bank Vehicles Register

 Computer Register

 Machinery and Equipment

 Renovation register
Product and Services
Product and services are the major attribute of any company, which are developed according to
the needs of the customers of the company. Similarly the product and services of the Askari
Bank are developed the customer needs and wants and the expectation that customer attaches
with financial institutions. A product of Askari Bank includes all those services which customer
normally required for effective managing his business.
Askari Bank offers the following financial services:

• Deposits

• Advances

• Products

• International Banking Services

• Agency Services to customers

Deposits
One of the basic functions of the bank is to receive deposits. Askari Bank accepts deposits in
both local and foreign currency.

Local Currency Deposits


 Current Account

 PLS Saving Account

 Term Deposits

 Notice Deposits

 Askari Faida account

 Askari Special Deposit Account

 Value Plus Saving Account

 Askari Advantages

Advances
Advances are major source of earning income for commercial banks. Banks attract surplus
balance from customers at low interest rates and make advantage at high interest rates to the
individuals or businesses. Askari Bank provided these two facilities:

 Funded Facilities

 Non-Funded Facilities

Products
Smart Cash
It is product of the Askari Bank in which is offer to the personal letter of credit and its has two
maximum limits: 500,000 for clean credit and 1000, 000 for secure credit.
Product Featuring:

Borrower: Resident Pakistani Nationals


Facility: Personal Line of Credit.
Maximum up to Rs. 500,000/-(Clean)
Financing Limits:
Maximum up to Rs. 1 Million (Secured)
Tenor: One year (renewable).
Repayment: Monthly debt servicing on the outstanding balance.
Markup Rates: Competitive.
Servicing: Available at all Askari Bank Branches
Balance Transfer Facility: Available.
Eligibility to Apply:
Age: Between 21 to 65 Years.
Income: Minimum gross monthly income of Rs. 25,000/- only.
a) Salaried: Minimum length of confirmed service with present employer is six
Employment:
months with a total length of one year service. b) Self Employed: Minimum 1
year in business. (Against security).
Charges/Fees: As per current schedule of charges.

Personal Finance
One can avail unlimited opportunities through Askari Bank’s Personal Finance. With unmatched
financing features in terms of loan amount, payback period and most affordable monthly
installments, Askari Bank’s Personal Finance makes sure that you get the most out of your loan.
No matter what your need is Askari Bank has more ways to serve you than ever before.
Product Featuring:

Borrower: Resident Pakistani Nationals.


Facility: Term Finance
Financing Limits: Maximum up to Rs. 500,000/. (Clean)
Maximum up to Rs. 1 Million. (Secured)
Tenor: Maximum up to 5 Years
Repayment: Monthly Installments
Markup Rates: Competitive
Servicing: Available at all Askari Bank branches
Balance Transfer Facility: Available
Eligibility to Apply:

Age: Between 21 to 65 years.


Income: Minimum gross monthly income of Rs. 10,000/- only.
Financing Limits: Maximum up to Rs. 500,000/. (Clean)
Employment: a) Salaried: Minimum length of confirmed service with present
employer is 6 months with a total length of 1 year
service.
b) Self Employed: Minimum 1 year in business.
Charges/Fees: As per current schedule of charges.

Mortgage Finance
Askari “Mortgage Finance” offers the convenience of owning a house of choice, while living in
it at its rental value. Ever since the inceptions of life, shelter has been rated among the primary
needs of mankind. Owning a home for oneself still remains an exclusive dream for many. Askari
Bank has made the realization of your dream to have a house of your very own possible.
Whether you plan to build a house, tailor made to your requirements or buy a constructed house,
Askari mortgage finance enables you to pursue your goal without any problems.
Product Featuring:

Borrower: Resident Pakistani Nationals.


Financing Limits: Maximum up to Rs. 30 Million.
Tenor: Maximum up to 20 years.
Repayment: Monthly Installments.
Prime Security: Mortgage of property.
Markup Rates: Competitive
Servicing: Available at all Askari Bank Branches
Balance Transfer Facility: Available
Balance Transfer Facility: Available.
Eligibility to Apply:

Age: Between 21 to 65 years.


Minimum gross monthly income of Rs.20, 000/-
a) Salaried: only and a permanent employee with at least 2
Income:
years of service including present employer.
b) Self Employed: Minimum length of 1 year in business.
Charges/Fees: As per current schedule of charges.
Business Finance
In pursuance of the National objectives to review the economy of the country, Askari Bank is
providing loans to SMEs under Askari Bank Business Finance Scheme. You always wanted to
put in that extra money into your business, which makes it grow... and grow! Now you can stop
worrying about your daily cash requirements, and start enjoying our unique Askari Business
Finance facility.
It is available upto 60% of the assessed market value of your residential property, through
equitable/token mortgage.
Product Featuring:

Borrower: Resident Pakistani Nationals.


Facility: Running Finance/Term Finance.
Maximum up to Rs.1.0 Million
Financing Limits:
Maximum up to Rs.50.0 Million
Primary Security: Residential & Commercial / Built up Properly & Land.
Mode of Financing: Running Finance: One year line of credit (renewable).
Running Finance: Monthly debt servicing on the outstanding
Repayment:
balance.
Markup Rates: Competitive.
Servicing: Available at all Askari Bank Branches.
Balance Transfer Facility: Available
Eligibility to Apply:

Age: 21 to 65 Years.
Borrowers: Resident Pakistani Nationals.
Business Requirements: Maximum up to Rs. 500,000/. (Clean)
Minimum one year's business or professional experience in
Employment:
the present business
Charge/Fees: As per current Schedule of charges
ASKCARD
Askari Bank is committed to provide you innovative and competitive solutions to your banking
needs in a more efficient and personalized manner. Your Bank enjoys a strategic competitive
advantage over all domestic players by virtue of its leadership, large network and technological
advancement. In line with our tradition of innovation, Askari Bank takes pride in announcing
launch of Askari Bank's Debit Card.
Askari Debit Card means freedom, comfort, convenience and security, so that you can have retail
transactions with complete peace of mind. Askari Debit Card is your new shopping companion
which enhances your quality of life by letting you do shopping, dine at restaurants, pay your
utility bills, transfer funds, withdraw and deposit cash through ATM anywhere, anytime.
"Convenience at its best"
Why ASKCARD?
• Free of Cost (24) hours Global Accidental Life Insurance upto Rs. 500,000/- for every
cardholder irrespective of balance in the account
• Free ATM Cash Withdrawal Insurance upto daily cash withdrawal limit of the cardholder
against snatching, armed hold-up or forced deprivation of money
• Free issuance of Debit Card for new Value Plus Accountholders
• Umrah Tickets for 2 lucky cardholders (Each year)
• Home insurance of 10 lucky cardholders (Each year)
• No hidden charges
• Free from carrying cash or cheque books
• Free Funds Transfer Facility
• Free Utility Bills Payments through ATM’s
• Shopping Facility at POS terminals
• Maximum daily cash withdrawal limit
• Balance Inquiry, Mini Statement
• Supplementary Cards
• Un-matched Online Real-time Services
Askari Rupee Traveler Cheques
Askari Bank Limited has always remained at forefront in introducing innovative and unique
products in banking sector. Our financial instruments provide greater financial freedom and
security in an unmatched way to our valued customers.
Askari Bank offers you its "Rupee Traveler Cheques" eliminating all financial risks while
traveling which was launched in March 2002. So avoid risk of carrying cash through Askari
Bank's Rupee Traveler Cheques.
"Your Best Travelling Companion"
Why Askari Bank's Rupee Traveler Cheques?
Why Askari Banks’ Rupees Traveler Cheques?
1. Free issuance
2. Free encashment
3. Profit will be offered at the time of encashment*
4. Nationwide acceptability
5. Facility of encashment in cash to the purchaser
6. Facility of encashment through clearing
7. No purchasing limit
8. Valid until encashed
9. Easily transferable
10. Account relationship not mandatory
11. Fastest refund procedure in case of loss / theft
12. Safe & secure mode of funds transfer
13. Available in Rs. 10,000 Denomination at all branches of Askari Bank
14. Perfect substitute of your cash

Investment Certificates
Askari Bank's Investment Certificates not only provide the added security, investment and
monthly return to the customers. These certificates are negotiable and can be transferred to third
party. Investment Certificates can be issued for a period of 3 months and profit is payable on
monthly basis through pre-printed tear-off coupons.
Product Features
1. Free issuance and free encashment
2. Account relationship with Askari Bank is not mandatory
3. No penalty on pre-mature encashment
4. Negotiable and payable in Pakistan in Pak rupees only
5. No purchasing limit
6. Valid until enchased
7. Encashable at all Askari Bank Branches
8. Profit is payable on monthly basis through pre-printed coupons
9. In case of loss / theft or damage, there is replacement / refund to the original purchaser
10. Encashment by third party
11. There is no penalty on pre-mature redemption, except that profit coupon shall be valid
only for completed month

Askari Value Plus Deposits


Askari Bank leads the way, yet again with the introduction of Askari Value Plus Rupee Deposit
Accounts, which promise greater financial freedom and security, in an un-matched way.
Now you can open a "Value Plus Account" while enjoying the flexibility of a normal checking
account.
Types of Value Plus Account
1. Value Plus Current Account
2. Value Plus Saving Account
3. Value Plus Time Deposits
Why Askari Value Plus Account?
1. Free issuance of Debit Card
2. Free global accidental insurance coverage against debit card irrespective of balance in the
account or age of the cardholder
3. Free ATM Cash Withdrawal insurance
4. Free online funds transfer facility
5. Free internet banking services
6. Free of cost 24 hours global accidental insurance coverage up to Rs. 2 million
7. Facility of Supplementary Debit Cards
8. Monthly returns on saving deposits
9. Partial encashment facility for time deposits
10. Automatic roll over facility for time deposits
11. Our un-matched service quality

AskPower
AskPower represent a useful tool with which to make secure payments without the need of the
any account, a debit or credit card. This card comes with a number of unique features and
diversified usage capabilities like cash withdrawal from ATM, payment of utility bills through
ATM and internet banking, transfer of balance to another card or refill option. The prepaid card
is enjoying a great success all over the world.

Askari MasterCard
Askari Bank leads the way, yet again with the introduction of Askari MasterCard, which promise
greater financial freedom and security, in an un-matched way.
Product Features:

• No joining Fee is charged after successfully applying for Askari MasterCard.

• You can use Askari MasterCard at thousand of locations in Pakistan as well as at over 23
millions establishments worldwide.

• With Askari MasterCard you are always a phone distance away from the assistant you
need. You can call any time of the day in Customer Service Center in Karachi, Lahore,
and Islamabad.

• Comparatively low service charges on Askari MasterCard

• In case of any loss or theft of your Askari MasterCard immediately inform Customer
Service Center and get replacement card within 24 hrs.
• You can get a supplementary card for your beloved ones at the time of the receiving your
own card. This card is available for person whose age is more than 18 years.

• You can get advance cash on Askari MasterCard p to the 80% of your sanctioned credit
limit in Pakistan or anywhere in the world and from some ATMs.

• You can avail Balance Transfer facility with Askari MasterCard at rate of 1.5% per
month.

• If you purchase your travel ticket on Askari MasterCard , you are automatically covered
under our Travel Insurance Plan(in case of personal accident resulting in death or
permanent disability) for up to Rs.8,000,000/- on a Gold Card and Rs.4,000,000/- on a
Silver Card.

• When you purchase your airline ticket on Askari MasterCard you get:

 Up to *Rs.10, 000/- insurance cover for flight delays exceeding 6 hrs.

 Up to *Rs.10, 000/- insurance cover for baggage delays exceeding 6 hrs.

 Up to *Rs.20, 000/- as baggage loss claim

*(Certain conditions apply)

• Get complimentary services at Quid-e-Azam International Airport, Karachi and RAWAL


lounge of Islamabad International Airport:

 Snacks and beverages

 Free internet , phone and fax facilities

 Newspapers and Magazines

 Flight detail information

 Cellular phone charger connections

 So, no matter where you are going, you are always assured of red carpet welcome.

• Your Askari MasterCard entitles you to the following *discounts at Avari Hotel in
Karachi, Lahore and Dubai:

 60% on Room rack rates

 10% on restaurants
 15% on Hall rentals

 15% of Family Health Club membership

 15% at the Business center

 10% 0n conferences/ Meetings Package Rate

 10% on Beauty Saloon

 10% on Rent a Car

*(where available certain conditions apply)

Cash Management Services


Askari Cash Management Services, aimed to effectively manage the accounts receivable
portfolio of medium and large corporate entities. While this service helps the corporate entities to
improve their liquidity, due to our well diversified branch network.
The service primarily aims at providing clearing, collection and cash / transfer facility to
corporate, under one resource center, which will handle the process through the branches and
provide adequate reporting to the corporate clients, on various aspects of their accounts
receivable portfolio, every month.

Internet Banking Services


In pursuance of our quest to provide the most modern service to our customers, we offer banking
through internet. Askari Bank is the first bank in Pakistan to provide such service to its valued
customers which is absolutely FREE.
Important Features
1. Balance enquiry
2. Funds transfer
3. Statement of accounts
4. Change of password
5. Free payment of utility bills
6. Payment of school fee
Askari Mahana Bachat Account (1 + 3 Years Term)
“Earn Rs.925/- per month on investment of every Rs.100, 000/- for one year!"
“Earn Rs.1, 000/- per month on investment of every Rs.100, 000/- for three years!”
Askari Mahana Bachat Account is a Term Deposit facility available to individual customer with
the option of 1 and 3 Years tenure. It has been designed keeping in view savings needs of
individual investors who don’t want to block their funds for longer terms, with a competitive rate
of return paid monthly on the 1st of every month. A financing facility up to 90% will be
available for customers if required.
Salient Features

Product Type: Term Deposit


Eligibility: Individuals Only
Minimum Rs. 50,000/- In multiples
Balance requirements: Maximum up to Rs. of
10,000,000/- Rs. 25,000/-
Tenure(s): 1 + 3 Years
Profit payment: Monthly - 1st of every month
Profit Rates: Competitive
Servicing: Available at all Askari Bank branches
Financing Limits: Upton 90% of the principle amount

Askari Deposit Multiplier Account


“Value of initial investment of Rs.100, 000/- will increase to Rs.265, 000/- at maturity!”
Aim higher with your investments with Askari Deposit Multiplier account. This account is for
individual investors whose purpose is long term savings with high returns. With a tenure of 10
Years and a competitive rate of return on maturity this account is ideal for investors who wish to
start saving for their future today.
Salient Features

Product Type: Term Deposit


Eligibility: Individuals Only
Minimum Rs. 50,000/-
Balance requirements:
Maximum up to Rs. 10,000,000/-
Tenure: 10 Years
Profit payment: On maturity
Profit Rates: Competitive
Servicing: Available at all Askari Bank branches
Financing Limits: Upton 90% of the principle amount

Electronic Bill Payment Services


It has always been our endeavor to introduce products and services tailor made to the
requirements of our valued customers. Now you can pay your Utility Bills through:
1. ASKCARD (Askari Debit Card),
2. Askari bank's ATMs Nationwide
3. Internet Banking Services
4. Call Center.

Askari Roshan Mustaqbil Deposit


Askari Bank has launched the Askari Roshan Mustaqbil Deposit, a saving plan specially
designed for individual investors who wish to invest now for a regular return at a later stage
while keeping their principal amount intact. With Askari Roshan Mustaqbil Deposit you can
double your investment in a time period of ten years. Invest now in the form of monthly deposits
for five years and get paid back the same amount for the next five years while receiving your
principal amount in full at the end of the tenure.
Salient Features

Product Type: Term Deposit


Eligibility: Individuals Only
Balance Minimum Rs. 5,000/- In multiples of
requirements: Maximum up to Rs. 50,000/- Rs. 5,000/-
Tenure: 10 Years (5 + 5)
Profit payment: Monthly – on completion of first 5 years
Profit Rates: Competitive
Servicing: Available at all Askari Bank branches
Upton 90% of the principle amount after
Financing Limits:
completion of first 5 years

Agriculture Finance Solutions


The role of agriculture in Pakistan economy is of pivotal
nature. Due to diverse geographical and climatic
conditions the country has tremendous potential for
growth and development in agriculture. However,
adequate and timely financial assistance to the farmers
will improve production potential of agriculture sector in
the country. The modern concept of agricultural credit
envisages establishment of an efficient institutional
credit system to serve as a package of credit, supplies
and knowledge for the overall strength of the farmers who at present suffer from low
productivity and financial insecurity. A successful credit evaluation system, therefore, should
have the basic ingredients to provide adequate amount at the right time and in the right form to
help farmers in making a productive use of loan funds.

Askari Kissan Agriculture Finance Program


The Askari Kissan Agriculture Finance Program (AKAFP) has been designed to meet ON
FARM / OFF FARM credit requirements of farmers on the most convenient, flexible, easy
terms and conditions. The program features:
• A broad array of credit lines designed to meet farming requirements.
• Repay and borrow at your convenience on revolving credit basis at lowest mark-up rates
renewal able after three years.
• Convenient repayment terms based on cash flow abilities.
• Availability of leased Tractors / Transport without Land / Collateral.
• No Hidden Cost.
• Availability of interest free package for inputs and tractors etc.
• No Pre-adjustment penalties.
• Earn prompt payment Bonuses and reduce financial costs.
• Insurance cover of leased assets, animals, crops and life assurance of borrowers.
1) Kissan Ever Green Finance
Askari Bank has launched this program with the sole motive to provide dignity, prosperity and
freedom to the tiller of the land. The program is designed to help small, medium and large
farmers in meeting their short-term input requirements against one time sanction and
automatically renewable up to 3 years subject to its stipulated utilization/periodical adjustment.
The credit line is sanctioned in the light of available cash flows and input requirements i.e.
Seeds, Fertilizer & Pesticides etc.
Salient Features of the Program are given as:
• Farmer opens a profit earning "Askari Ever Green Account" with the branch. A special
cheque book is issued to the farmer.
• Revolving credit limit as "Ever Green Agri Finance" is available to the farmer against
security i.e. mortgaged charge on Agri land through Zari Pass Book.
• Hassle free, automatic renewal upon adjustment of entire principal amount with mark-up
once in a year.
• The account is farmer friendly which benefits the farmers both ways. If the account is in
credit, it earns profit; otherwise it provides instant finance, to the farmer for his
agriculture needs.
• The mark-up is charged for the actual days the finance is utilized.
• Profit on credit balances will be paid on half yearly basis as declared by the bank on PLS
savings accounts.
2) Kissan Tractor Finance
Traditional modes of cultivation viz Bullocks, Camels, horses etc can no longer keep pace with
the demands of present times due to manifold increase in the population. Power in the form of
modern technology is therefore the need of the hour. To meet this emergent requirement, Askari
Bank has launched an Askari Kissan Tractor Finance to bring power to the fields.

Salient Features of the Program are:


• This program has been designed to benefit the owner as well as non-owner farmers.
• The farmer will have privilege of availing non-funded facility at a reduced cost under this
program on account of more equity participation.
• Although the facility is available for a period of five years. However, good farmer bonus
will be available to the borrower in case the loan is repaid as per terms of sanction.
• Priority in delivery of tractor will be given by manufacturer as per arrangements with the
bank.
The farmer’s life & tractor will be insured against contingencies, which will provide comfort and
peace of mind.

3) Kissan Aabpashi Finance


Agriculture farming is impossible without adequate water. We can combat the prevalent water
scarcity by harnessing more natural resources. Increased use of mechanical means thus provides
a ready alternative. Keeping in view the scarcity of water, which is the lifeblood of arable lands,
Askari Bank has started a program for farmers, to finance installation of Tube-Wells (electric,
diesel and solar energy units) water management equipments and water channel development
etc., which will help farmers to make optimum use of limited water resources.
Salient Features of the Program are:
• To facilitate the farmer, to overcome the scarcity of water.
• To develop mechanical water resources, sprinkler and drip system etc.
• To avoid traditional / inefficient modes of irrigation and waste of available water.
• To manage natural / available resources through water management practices.
4) Kissan Live Stock Development Finance
In order to supplement the income of the farmer, Askari Bank has launched a program enabling
the farmer to purchase Milch Animals, Goats, Sheep, Poultry and Fisheries without incurring
extra expenditure because of availability at his farm. He will be able to get milk, meat and eggs
etc., which normally do not form part of his diet. This program has the added advantage that
besides fulfilling his own family’s consumption needs he will be able to market the surplus and
earn additional income. This will further improve their cash flows to repay their other Loans /
Revolving Credit on due date.
Salient Features of the Program are:
• The program will provide regular day to day income to the farmer to meet his own
consumption and surplus to be marketed.
• This will revive / accelerate and supplement the income generating capacity.
• It will enhance the repayment capacity of the farmer.
5) Kissan Farm Mechanization Finance
Beside Power at the farm i.e. Tractor, the benefits / advantages of power are maximized with the
use of Mechanical Support i.e. modern and improved equipments which essentially complement
one another due to their cost effectiveness and time efficiency. Askari Bank has launched an
Askari Kissan Farm Mechanization Finance for the assistance of the small farmers and provides
finance for farm equipment, trailer, thresher, drills & rotavators etc.
Salient Features of the Program are:
• Under this program the farmer will get benefit of use of modern agricultural tools,
implements and equipments which are cost and time effective.
• Improves per acre yield of Agri crops and quality of agriculture produce to get good price
in the market.
• Helps to match / compete with international standards for exportable agriculture produce.
Islamic Banking Services
Islamic Banking was launched under the brand 'Askari Islamic Banking', by opening 6 dedicated
Islamic Banking branches in major cities of the country. Further expansion is planned with
improved capabilities for offering products conforming to the Shariah principles.
Askari Islamic Banking opens the doors for Halal banking solutions. Our objective is to put in
place an efficient banking system supportive to economic justice and welfare of society in line
with Shariah standards.
A comprehensive range of Islamic Banking products and services is being offered, in order to
meet customer's demand of Shariah Compliant Banking, in the following areas:
• Islamic Corporate Banking
• Islamic Investment Banking
• Islamic Trade Finance
• Islamic General Banking
• Islamic Consumer Banking
Islamic Banking products have been approved by the Bank's Shariah Advisor. As per Shariah
requirements, funds and products of Islamic Banking are managed separately from the
Conventional Banking side. All funds obtained, invested and shared in Halal modes &
investments, under supervision of the Shariah Advisor.
Branch Network
Your Bank is fully aware that the branch network has direct implications on the services that it
provides to its valued customers. During the year, your bank opened no of new branches
including some Islamic Banking branches. We now offer services through a network of 204
branches, including the Offshore Banking Unit in Bahrain. Through this branch network, we are
able to present our wide range of products and services to our valued customers. In the first
quarter of 2009 four branches have been opened and further expansion will continue during 2009
and work is already underway at some proposed locations. Strategic branch expansion remains
our priority to cover all important towns and cities and to explore new markets in the smaller
towns for our retail, agriculture and Islamic Banking products and services, supported by our
technology based services such as on-line banking and ATMs.
SOUTH REGION

Karachi I 10
Karachi II 10
Karachi III 10
Karachi IV 10
Hyderabad 13
Quetta 9
Corporate 1
Islamic Banking 7
Total Branches 70
CENTRAL REGION

Lahore I 10
Lahore II 10
Lahore III 9
Faisalabad 11
Gujranwala 10
Multan 10
Corporate 1
Islamic Banking 8
Total Branches 69
NORTH REGION

Islamabad 15
Rawalpindi I 12
Rawalpindi II 10
Peshawar 12
Azad Kashmir 6
Islamic Banking 5
Total Branches 60
Wholesale Bank Branch is 1 in Bahrain

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