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INTERNSHIP REPORTON

UNITED BANK LIMITED

SPECIALIZATION: BANKING & FINANCE

SUBMITTED TO: CHAIRMAN, DEPT. OF BUSINESS ADMINISTRATION

SUBMITTED BY: ADNAN FAROOQ ROLL # T-521199 REG # 06PMN0039 382 - RAVI BLOCK, ALLAMA IQBAL TOWN, LAHORE. TEL # 042-5417364 MOB # 0300-6720085

DEPARTMENT OF BUSINESS ADMINISTRATION ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD.ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD 1

IN THE NAME OF ALLAH THE MOST BENIFICIENT AND MOST MERCIFUL

ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

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DEDICATED To My Beloved Parents For Having Firm Belief in My Abilities & Whom Prayers Enabled Me To Accomplish This Milestone

ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

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MESSAGE OF THE QUAIDMUHAMMAD ALI JINNAH

We must work our destiny in our own way and present to the world an economic system based on true Islamic concept of equality of manhood and social justice. We will thereby be fulfilling our mission as Muslims and giving to humanity the message of peace which alone can save it and secure the welfare, happiness and prosperity of mankind.

(SPEECH AT THE OPENING CEREMONY OF STATE BANK OF PAKISTAN, KARACHI JULY 1, 1948).

ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

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FINAL APPROVALThis is to certify that we have read the report submitted by MR. ADNAN FAROOQ Roll No. T-521199 and It is our judgment that this is of sufficient standard to warrant its acceptance by ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD, for MBA (B&F) degree.

REPORT EXAMINING COMMITTEE

SIGNATURES

STAMP

ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

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ACKNOWLEDGEMENTAll praise to ALMIGHTY ALLAH alone, the Omnipresent and the most Merciful and compassionate. The words are bound, knowledge is limited and time is short to express His dignity. It is one of infinite blessings of ALLAH that he bestowed me with the potential and ability to contribution towards the deep oceans of knowledge already existing. I pay hum-age to greatest personality of the universe; HOLY PROPHET HAZARAT MUHAMMAD (PBUH) Who is forever torch bearer and spring of guidance in every sphere of life. I am deeply indebted and also express my gratitude to my respected teachers at ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD for their support. At the very outset, I am very thankful to Mr. ZULIFQAR AHMAD RANA (AVP UBL) for providing me the opportunity to have an excellent learning experience during my internship at REGIONAL CREDIT ADMINISTTRATION DEPARTMENT-

COMMERCIAL BANKING (RCAD-CB) UNITED BANK LIMITED, LAHORE. It is my privilege and honors to express my deep gratitude and in calculating thanks to Mr. Sohail Amjad Vice President & Head RCAD-CB UBL, Lahore . The person to whom I would like to give my regards is the MIS OFFICER Mr. WASIM AHMAD of RCADCB UBL, LAHORE who gave me very useful tips and information. I might not be able to complete my internship without his cooperation and his kind behavior. I am thankful to all of my teachers especially Mr. Muhammad Azeem and Mr. F. R. Tariq (N. K. Fact College, Lahore). I am thankful to all of my class fellows and friends whom cheerfulness and guidance is an asset for me .I am especially thankful to the bank staff and particularly. Mr. Nabeel Anwar Mr. Badar Munir Mr. Naeem Azam Mr. Mohsin Hassan Mr. Sohail Saeed Mr. Nadeem Saif Senior Vice President & Head North Processing Officer Documentation Officer Documentation Officer Processing Officer Processing Officer 6

ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

EXECUTIVE SUMMARYUnited Bank Limited (UBL) is the second largest bank of Pakistan with assets of over Rs. 550 billion and a solid track record of forty six years - in addition to the convenience of over 1400 branches serving its customers throughout the country and also at several overseas locations. In this 12 weeks (3 Months) internship program I have worked in Regional Credit Administration Departments (MIS section, Processing section, Documentation section) of this high class bank of Pakistan where I have learned about banking from experienced managers running these sections. This report contains the information and learning about UBL that I learnt during the 12 weeks internship period in United Bank limited. This report deals with History & Nature (Business) of the UBL, its Products and Services, information about main offices and also the review of various departments of the Bank. This report also contains Finance & Accounting operations of the UBL, role of Financial Manager (Branch Manager), Use of Electronic Data in core decision making and the Sources, Generation and Allocation of funds used in the banking operations of the UBL. Recognizing the need of Islamic banking, UBL also provided number of Islamic banking services like Islamic Deposit Schemes and Islamic Fund Based Facilities. At the end of this report, on basis of my observation during internship, financial analysis and SWOT analysis of UBL is provided. Suggestions are also recommended as per learning from analysis. This report will provide a better and brief learning about United Bank Limited.

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OBJECTIVESThis internship offers me an incredible opportunity to gain real-world experience in the high-stakes finance industry. Most importantly this internship allows me to distinguish myself from my classmates, as I gain a competitive advantage by connecting my coursework with industry experience. Following are important objectives of studying the organization: Categorize the different products and services offered by the financial institution and note how to most efficiently match those products and services with the needs of customers. Analyze the companys financial condition through the financial statements (compute financial ratios and compare to the industry averages). To describe the impact of financial decisions on the health and functioning of the overall organization. To learn the various steps and procedures of credit risk management & administration. Finding out the weaknesses, short comings, strengths and beauties of the credit administration department.

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TABLE OF CONTENTS1. OVERVIEW OF THE ORGANIZATION 1.1 BRIEF HISTORY OF THE ORGANIZATION 1.1.1 1.1.2 1.1.3 1.1.4 1.1.5 1.2 ABOUT UBL FORMULATION NATIONALIZATION PRIVATIZATION OF UBL UBL TODAY 01 01 01 01 01 02 02 04 05 05 06 06 06 07 07 08 08 08 09 09 10 10 12 15 15 16 17 18 19

NATURE OF THE ORGANIZATION 1.2.1 1.2.2 VISION STATEMENT MISSION STATEMENT

1.3

BUSINESS VOLUME 1.3.1 1.3.2 1.3.3 1.3.4 REVENUEDEPOSITS

ADVANCES COMPUTATION OF ADVANCES

1.4

NUMBER OF EMPLOYEES 1.4.1 1.4.2 1.4.3 1.4.4 BOARD OF DIRECTORS STAFF STRENGTH KEY MANAGEMENT MANAGEMENT HIERARCHY

1.5

PRODUCT LINES 1.5.1 1.5.2 1.5.3 DEPOSIT PRODUCTS LOANS & CARDS AGRICULTURAL PRODUCTS 1.5.3.1.1 1.5.3.1.2 1.5.4 1.5.5 1.5.6 FARM LOANS NON FARM LOANS

SMALL BUSINESS NRP SERVICES OTHER SERVICES

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2. ORGANIZATIONAL STRUCTURE 2.1 MAIN OFFICES 2.1.1 2.1.2 2.1.3 2.1.4 2.1.5 2.1.6 2.2 HEAD OFFICE BRANCHES DOMESTIC NETWORK PROVISIONAL HEADQUARTERS BRANCH HIERARCHY OVERSEAS NETWORK

22 22 22 23 23 23 24 25 26

DEPARTMENTS OF THE UBL

3. STRUCTURE AND FUNCTIONS OF THE ACCOUNTS/ FINANCE AND AUDIT DEPARTMENT 3.1 3.2 3.3 3.4 ORGANIZATIONAL CHART (FINANCE DEPARTMENT) MY LEARNING AS AN INTERNEE FINANCE AND ACCOUNTING OPERATIONS THE ROLE OF FINANCIAL MANAGER 3.4.1 3.4.2 3.4.3 3.5 3.6 3.7 3.8 ACCOUNTS MANAGEMENT CASH MANAGEMENT CREDIT MANAGEMENT 34 34 35 35 35 37 38 38 41 47 47 49 57 57

USE OF ELECTRONIC DATA IN DECISION MAKING SOURCES OF FUNDS GENERATION OF FUNDS ALLOCATION OF FUNDS

4. CRITICAL ANALYSIS OF THE THEORETICAL CONCEPTS 4.1 FINANCIAL ANALYSIS 4.1.1 4.1.2 4.1.3 4.1.4 4.1.5

RATIO ANALYSIS (ABBREVIATIONS USED IN CALCULATIONS 59 CALCULATION OF RATIOS GRAPHICAL REPRESENTATION OF RATIOS EXPLANATION OF FINANCIAL RATIOS HORIZONTAL ANALYSIS 60 62 65 68

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4.1.5.1.1 4.1.5.1.2 4.1.6

BALANCE SHEET PROFIT & LOSS ACCOUNT

68 73 77 77 80 82 83 84 85 86 88 89

VERTICAL ANALYSIS 4.1.6.1.1 4.1.6.1.2 BALANCE SHEET PROFIT & LOSS ACCOUNT

4.2 4.3

ORGANIZATIONAL ANALYSIS FUTURE PROSPECTS OF THE ORGANIZATION

5. SHORT FALLS/WEAKNESSES OF THE ORGANIZATION 6. CONCLUSION 7. RECOMMENDATIONS 8. REFERENCES 9. ANNEXES

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1. OVERVIEW OF THE ORGANIZATION1.1. BRIEF HISTORY OF THE ORGANIZATION:1.1.1. ABOUT UBL: The history of UBL can be divided into four main Phases: Formulation Nationalization Privatization UBL Today 1.1.2. FORMULATION: In June 1957, Mr. Agha Hassan Abidi decided to open a Bank different from others, to provide modern facilities to trade and industry and to promote thrift and habit of saving amount common thereby stimulating the economy as a whole. Necessary formalities completed for obtaining registration certificate from State Bank of Pakistan to perform business activities. After passing through all these formalities on 7th November, 1959 United Bank Ltd came into existence as a Schedule bank. The Head office of the Bank was established in the New Jubilee Insurance House, 1.1 Chundrigar Road Karachi. It was registered as a joint stock company. The bank was incorporated with an Authorized Capital of Rs 20,000,000 and issued and subscribed and paid up capital of RS 10, 00,000. Saigol family owned it and Agha Hassan Abedi was its first managing Director. It had posted a profit of 0.7 million in its first year of operation with just eight branches at Karachi. 1.1.3. NATIONALIZATION: As a pol