Acknowledgment

In The Name of Allah, the Most Beneficent, the Most Merciful

All gratitude and thanks to almighty “ALLAH” the gracious, the most merciful and

beneficent who gave us courage to undertake and complete this task. We are very much

obliged to our ever caring and loving parents whose prayers have enabled us to reach this

stage.

We are grateful to almighty ALLAH who made us able to complete the work presented in

this report. It is due to HIS unending mercy that this work moved towards success.

We are highly indebted to our course instructor Ms.Syeda Habibah Hussain Rizvi for

providing us an opportunity to learn about the Business communication and ethics and

assign us to implement on “Bank Al-Falah" which is vital ingredient of BBA program.

We are very great full to our teacher for providing us guideline for the completion of

this report.

We feel great pride and pleasure on the accomplishment of this report.

- 1 -

Preface

Banking sector owes a crucial importance in the economy of any country through its

vibrant functions. This is the deep motivation that geared up us to select the bank for our

project. Moreover, the practice and familiarity observed and learned during this time

period would also attest very helpful and alleviating in the awaiting proficient life.

This report is an upshot of our observations and the information collected from Bank Al-

Falah, Pakistan. Bank Al-Falah posses an imperative importance in the Banking sector of

Pakistan. It always remains the center of hustles in business activities. It always endows

with great covenant of rally round in terms of funds and services.

Although, such a small period of time is not enough to learn the complex operations of

Bank Al-Falah Limited yet we made tough efforts to discuss them comprehensively in

this report. We have view many Marketing and Management concepts to elaborate this

report with the material read, listened and observed.

We have strong belief that this report will guide and ease the readers to understand the

operations and communication of Banking system and more significantly have good

knowledge about Bank Al-Falah Limited, one of the most trusty and leading Bank in

Pakistan.

We hope that the readers will appreciate our report and sense that reading our report is

not the wastage of time in any opinion.

- 2 -

EXECUTIVE SUMMERY

For successful market position, marketing, management, product and communication strategies are imperative in today’s rapidly moving high-tech market. Companies need to take a new technologies or ideas and efficient management to develop a complete product that addresses a customer needs and propagate these needs through communication effectively in valuable market as well as executive flawlessly on bringing it to market.

In this report we have tried to cover the marketing and management strategies by Bank Al Falah. Bank Al Falah was in corporate in June 21st, 1997 its banking operations started from November 1st, 1997. The bank engaged in commercial banking and related services. The bank is currently operating through 223 branches.

Bank Al Falah target market conceits of individual client as well as number of business organization. Bank Al Falah has segment the market on demographic, psychological and behavioral style to target maximum number of segments with different varieties of products suitable for each segment. In marketing terms this strategies in competitors is known as the “Flank Attack” &“Frontal Attack”.

In this report we have discussed the marketing plan, organizational culture and communication and financial analysis of Bank Al Falah Limited comprising of segmentation, product & services, competitors analysis, positioning marketing mix, means of communication, HR and other departments carried by the Bank Al Falah. We have also briefly discussed the integrated marketing communication (IMC) being used by the Bank Al Falah to address its customers.

We have tried our best to cater all of these aspects being followed by Bank Al Falah and hope that this report will help you explain your concepts about these strategies to a greater extent.

- 3 -

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 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 efficiency of the banking

sector afterwards a privatization Commission was set up on January 22, 1991 and the

commission transferred many banks to the private sector i.e., MCB & ABL. The

government approved & permitted the establishment of 10 new private banks in 1991.

Hence many new private banks have incorporated. Since then, BANK ALFALAH is one

of the namely established private banks in Pakistan.

- 4 -

History

Bank of Credit & Commerce International (BCCI) was a Pakistan based bank established

by Mr. Agha Hassan Abdi from UBL in association with U.A.E and Europe. BCCI has its

branches in 74 different countries of the world. It had its 3 branches in Pakistan. In 1991,

the BCCI was banned when is was accused by European countries that the bank was

involved in some illegal operations with Gulf countries. The major reason behind

European accusation was that BCCI was of Islamic mode. There for the bank was closed

due to international pressure. Then its 3 Pakistani branches were taken over by the

Government of Pakistan which were named as Habib Credit and Exchange Bank (HCEB)

and these were working as subsidiary of Habib Bank Limited.

Following the privatization in July 1997, Habib credit and Exchange Band assumed the

new identity of Bank Alfalah on February 25, 1998. It is now Abu Dhabi based bank as

the family of Sheikh Nahayan Mubarik Al-Nahayan purchased 70% of its shares and

30% shares remained with Habib Bank on behalf of Government of Pakistan. It has its

18 branches in 8 cities of Pakistan at that time.

Charged with the strength of Abu Dhabi group and under the leadership of Sheikh

Nahayan Mabarak Al-Nahayan, Minister of Higher Education and Scientific Research,

Government of Abu Dhabi and a prominent member of Royal Family, the bank is

energized with the vision, envisaging the development of various sectors in Pakistan.

- 5 -

INTRODUCTION

Bank Al Falah Limited was incorporated in June 21st, 1997 as a public limited

company under the Companies Ordinance 1984. Its banking operations began from

November 1st, 1997. The bank is engaged in commercial banking and related services as

defined in the Banking companies ordinance 1962. The Bank is currently operating

through 223 branches in Pakistan with the registered office at B.A. Building, I.I.

Chundrigar, Karachi.

Since, its inception as the new identity of H.C.E.B after the privatization in 1997, the

management of the bank has implemented strategies and policies to carve a distinct

position for the bank in the market place. Strengthened with the banking of the Abu

Dhabi Group and driven by the strategic goals set out by its board of management, the

Bank has invested in revolutionary technology to have an extensive range of products and

services. This facilitates their commitment to a culture of innovation and seeks out

synergies with clients and service providers to ensure uninterrupted services to its

customers.

The bank perceived the requirements of customers and matches them with quality

products and service solutions. During the past five years, bank has emerged as one of the

foremost financial institution in the region endeavoring to meet the needs of tomorrow as

well as today. To continually upgrade the quality of service to the customers, training of

team members in all the integral aspects of banking, customer service and IT was

specially focused.

The portfolio concentrates on all aspects of conventional banking as well as the financial

needs of corporate sector. Dynamic and high value product includes Car Financing,

Home Financing, Rupee Travelers Cheques, Credits Cards, Debit Cards, On line

Banking, ATM and consumer Durables. In addition to this, Islamic Banking Division is a

recent initiative which operates as separate branch. It offers Shariah Compliant products

through a network of five branches, which will increase to 50 by the year 2007. The bank

is committed to combine all it s energies and resources to bring high value, security and

- 6 -

satisfaction to its customers, employees and shareholder. The Bank has invested in

revolutionary technology to have an extensive range of products and services. This

facilitates commitment to a culture of innovation and seeks out synergies with client and

service providers to ensure uninterrupted services to its customers.

mission statementVision:

" To be the premier organization operating locally & internationality that provides

the complete range of financial services to all segments under one roof. "

Mission :

" To develop & deliver the most innovative products, manage customer

experience, deliver quality services that contributes to brand strength, establishes a

competitive advantage and enhances profitability, thus providing value to the

stakeholders of the bank."

Slogan:“ THE CARING BANK ”

" Let’s Look Ahead Towards a Brighter Future Together "

 

Bank Believes:

"A tribute to our heritage"

- 7 -

Every door leads to our customers.

The legacy of leadership stands as our guiding light.

The strength of chain relies on the strength of each link.

A keen ear is a key to understanding. Achievement is nothing without target.

Time is our most valuable asset.

Performance is nothing without the ability to measure it.

long term Objectives• To make sure that all new services are well communicate to the clients in due

time.

• To make our product as user friendly as possible

• To facilitate our client in the best way and in turn create brand loyalty.

• To provide innovative and hassle free service to our clients.

• To help sales meet their targets.

• To make sure that all new services are well communicate to the clients in due

time.

To make sure that all new services are well communicate to the clients in due time.

BOARD OF DIRECTORS

H.E. Sheikh Hamdan Bin MubarakAl NahayanChairman

Mr. Abdulla Nasser Hawalileel Al-MansooriDirector  

Mr. Abdull Khalil Al MutawaDirector

- 8 -

Mr.Khalid Mana Saeed Al OtaibaDirector

Mr. Ikram Ul-Majeed SehgalDirector

Mr. Nadeem Iqbal SheikhDirector

Mr. Sirajuddin AzizDirector & CEO

CommitteeThere are two main committees in the Bank Alfalah Limited Board Advisory Committee

Executive Committee

- 9 -

Organizational Chart

Short term GOALS & OBJECTIVESGoals and objectives are factors through which the company’s devotion and commitment

to the job can be seen. If the goals are realistic and achievable, than surely that

organization is doing its job.

Bank Alfalah also has certain goals and objectives which it is trying to achieve, through

its various strategies and operations. The goals and objectives are mentioned below:

1. To create a sound base and through efficient systems achieve modern banking

throughout Pakistan.

2. By the end of every accounting year there is an increase in deposits. As the deposit

rate of during 2009 was approximate 52 Million and the same has been increased in

2012 by 77 Million.

3. To create unit banking network in all the branches of Bank Alfalah at the end of the

year. This means that all the operations of the bank, i.e. deposits to advances,

imports, exports, L/C Opening, foreign currency and many more aspects under one

roof, so that the customer can be facilitate in one visit.

4. Islamic Banking is one of the goals of Bank Alfalah though it has been initiated in

the last fiscal year and it is very acceptable for general public. However, there is lot

- 10 -

of work to do for successful implementation of the Islamic Banking Plan. In this

regard the Bank is opening specific Islamic Banking Branch under the supervision

of its Islamic Banking Division.

STRATEGIESBank Alfalah has formulated certain sets of strategies to enable it to achieve its goals and

objectives. These strategies are mentioned below:

1. In order to achieve its goals of creating a sound base and presence of efficient

modern banking system, Bank Alfalah has started operation of Automated Teller

Machines in all the major areas like Karachi, Lahore, Islamabad and other cities of

Pakistan.

2. Bank Alfalah is committed to building long-lasting relationships through an

assertion to service excellence and providing innovative products to meet the

changing needs of our valued customers. Although still in its infancy, compared to

the exalted banking standards, Bank Alfalah, backed by a strong Abu Dhabi Group

and inspired by the vision of its Board and Management, has built up a strong

customer base. The Bank provides a full range of banking services to corporate

clients, while applying leading technologies. Today the Bank is well-positioned to

provide appropriate banking services to customers.

3. The main focus is building relationships and being known by the way they do

business. Management recognizes that a banking relationship requires

compatibility, communication, and cooperation and that each customer deserves

nothing less than full attention and available resources to meet their financial

objectives.

4. Core value and corporate culture is based on the belief that superior personalized

service is the most important product. Bank is in the process of getting to know

customers by name and understand their business and personal financial needs. This

one-on-one, personalized service quality has served as Bank Alfalah's unique

signature since inception and continues to separate it from other financial

institutions.

- 11 -

5. The Bank Alfalah team comprises of some of the most highly skilled and

professional financial experts in banking industry. Managers, lenders and trust

advisors offer the unique perspective of knowing and understanding in the local

economy. The Management focuses its attention on making informed and feasible

economic decisions, bringing better returns and more profitability for investors and

customers.

6. Keeping in view the unrest among the Islamic Community on the Interest Bearing

Banking the Alfalah is in the process of target marketing and gives its full attention

to this segment of a large population over the world.

7. To acquire the reputation and status of bank which operates on international

standard, Alfalah Bank was to get the credit rating of Pakistan Credit Rating

Agency, which gave it the AA- and A1+ in the long term and short term

respectively.

Flow of command/ Chain of command:

Downwards communications are usually done in the Bank Alfalah for directing the

orders or strategies whereas upwards in terms of briefing them about the work done or in

progress. Middle management always works as the intermediary between the top

management and the lower. Usually, there is no such communications between the lower

and top management except in special occasions.

CEO

The CEO of the Bank Alfalah controls the whole management affairs

Everyone under him, Country managers, vice presidents are accountable before

him

He direct the orders or takes the suggestions or feedback from them .

Executive Incharge(E.I)

He establish the environment of the strategies planning and aware of to hold the

global market

Manages the HRM and assigns works to individual for betterment

Controls the administration activities and carries on the establishment process for

the betterment of Bank

- 12 -

Investigates the business development reports that our business get profit or loss

Analysis the audit and inspection division for efficient work

His work is to divide the cards in best manner just like debit, credit, ATM card

and Hilal card in Bank

He did his work for international and treasury division in Bank

Divided the I.T informational technology related work among the employees

Support the corporate and home finance

He monitoring the credit division

Investigate the legal affairs

Executive Vice President:

Responsible for the directing the actions and strategies to the Branch managers

All of the managers working under them are accountable to him

Managers gave feedback back or brief about the progress or flaws in the work to

the Vice President.

Branch Manager:

Responsible for the implementing the strategies into action by directing the plan

of action

Set the task force

Dividing into groups of team and then assign the special work to them

Managing all of the daily bases task related to the customer

Centralized V/S Decentralized:

Centralized describe the degree to which decision making is concentrated at a

single point in the banking or any organization. If the top managers make the

banking organizational key decision with the little or no input from below then

the banking organizational is centralized.

In Bank Alfalah the major portion of organizational is "Decentralized", because

the Managers of all levels have the power of decision making.

Types of Organization

Tall V/S Flat

- 13 -

Bank Alfalah is a Tall organization with the wide series of the Directors,

Presidents, Vice-President and Mangers working in the tree shape of hierarchy of

management.

Major Competitors:The growth in the banking industry of Pakistan has led to an increase in the number of

banks both domestic and international to be established and create a competitive industry.

For Bank Alfalah its competitors come in the form of both domestic and international

commercial banks established in Pakistan.

Allied Bank

Faysal Bank

Habib Bank

MCB Bank

United Bank

Citibank

National Bank

Market Shares:According to a publication of the State Bank of Pakistan, ‘The Banking Statistics of

Pakistan 2006’, the total deposits for banks over all were Rs. 3,200,332 (million) and

market shares of the competitor banks in term of deposits and other accounts are as

follows:

Banks Deposits(in thousands)

Overall Market Shares

Domestic Banks Market Shares

Bank Alfalah 239509391 7% 8%Askari Bank 131839283 4% 4%MCB Bank 257461838 8% 8%United Bank Limited

335077873 10% 11%

Citi Bank 63103884 2% 3%

As such no financial organization in Pakistan is unable to determine the correct market

share of the banking industry. Also banks do not disclose certain confidential

- 14 -

information to the general public and internees. Still generally foreign banks in Pakistan

contribute to about 35% to the whole banking industry. Out of which Askari, Citi,

Standard Chartered, Muslim Commercial, ABN-AMRO banks share the major market.

PRODUCTS portfolioWith the mission to provide all-encompassing banking services to the customers, Bank

Alfalah has a uniquely defined menu of financial products. Currently it is one of the most

comprehensive portfolios of personalized financial solutions that are custom-tailored to

serve the requirements not only of conventional customers but also fulfill the needs of the

corporate sector:

Car Financing

Home Financing

Credit Cards

Debit Cards

Rupee Travellers Cheques

Online Banking

ATMs

Islamic Banking

Corporate Financing

- 15 -

Car FinancingCar Financing is one of the major renowned product of Bank Alfalah and can be utilized

in terms of Financing of Used Vehicles, Loan against Car, Balance Transfer Facility,

Refinancing Facility (only for Alfalah Customers) and it is characterized in terms of:

Lowest Mark up

Lower Insurance

Quick Processing

Lower Down Payment

Quickest processing 

No hidden charges

Minimum down payment. 

Complete repayment at any point of time

Balance transfer facility (BTF) for existing as well as new clients from other

Banks 

Tenure period ranging from 1 to 5 years

Financing of all brand new locally assembled vehicles and used cars

Financing limit ranging between Rs. 200,000/- to Rs. 2000,000/- for brand new

cars 

1. Car Leasing

- 16 -

BAL’s recently introduced car leasing facility for individuals and corporate sector has set

new dimensions for the product. Now you are provided with the option of either to get

the vehicle leased or financed.

Insurance

Renowned and reliable Insurance companies are offering the competitive rates of

insurance. Pay year insurance premium in advance at the time of down payment and the

remaining in the subsequent equal monthly installment. 

Repayments

Easily affordable installments on monthly basis in the form of post-dated cheques will set

you free of depositing your rental cheques every month.

Security

Hypothecation of vehicle in the name of Bank Alfalah Limited. 

Product Price including ST & FEDw.e.f 01/07/09

Price IncludingST, FED & WHTw.e.f 01/09/09

SUZUKI MEHRAN    SUZUKI SB308R VX 317,739 325,600 SUZUKI SB308R VX CNG 348,000 356,600 SUZUKI ALTO    SUZUKI ALTO RA410 VX 422,643 433,100 SUZUKI ALTO RA410 VX CNG 457,948 469,300 SUZUKI CULTUS    Suzuki Cultus VXR Rs. 585,000/-Suzuki Cultus VXL Rs. 647,000/-Suzuki Cultus VXL (Met. Colors) Rs. 652,000/-SUZUKI RAVI    

- 17 -

Product Price including ST & FEDw.e.f 01/07/09

Price IncludingST, FED & WHTw.e.f 01/09/09

SUZUKI PICKUP ST308R 314,713 322,500 SUZUKI PICKUP ST308R CNG 346,991 355,600 SUZUKI BOLAN    SUZUKI VAN ST308 VTR 370,191 379,400 SUZUKI VAN ST308 VTR CNG 407,513 417,600 SUZUKI LIANA    SUZUKI LIANA 1.3L RXI MT 800,904 820,800 SUZUKI LIANA 1.3L RXI MT CNG 856,383 877,600 APV CBU    APV 1.5LGLXMT 1,007,687 1,032,700 APV 1.5LGLX CNG 1,058,122 1,084,300 JIMNY CBU    JIMNY MT 1,049,043 1,075,000 JIMNY JLSX MT 827,130 847,600 TOYOTA    Toyota Corolla XLi 890,000 915,000Toyota Corolla GLi 980,000 1,005,000Toyota Corolla 2.0D 1,050,000 1,080,000Toyota Corolla 2.0D Saloon 1,295,000 1,328,000Toyota Corolla Altis MT 1,245,000 1,280,000Toyota Corolla Altis AT 1,335,000 1,370,000DAIHATSU    Daihatsu Coure CL N/A 390,000Daihatsu Coure CL CNG N/A 431,000HONDA CITYHonda City I-DSI MT 1.3L 852,000Honda City VTEC Steermatic 1.5L 1,036,000HONDA CIVICHonda Civic VTI MT 1.8L 1,348,000Honda Civic VTI MT SR 1.8L 1,480,000Honda Civic VTI PT SR 1.8L 1,520,000HONDA ACCORDHonda Accord 2.4L 2,810,000

Two passport size photographs 

- 18 -

Copy of National ID card 

Bank statement for the last six months 

Salary certificate (for salaried individual) 

Business proof (for a business person) 

N.T.N Certificate

Co-borrower’s NIC copy (if the car is to be in the name of the co-borrower)

2. Home Financing

Major features of Bank Alfalh Home Financing are Lowest

Mark-up, Quick Processing, Multiple Repayment Options

and Free Valuation. It has been bifurcated in terms of

“Home Buyer, Home Construct, Home Improver, Home

Balance Transfer Facility”.

Financing Limit : up to Rs. 10,000,000/-

Tenure : up to 20Years

Equity Participation : 30% Borrower / 70% Bank

- 19 -

With this facility, you no longer need to just dream about the home you want for  yourself

and your family .We will provide you up to 80% of the  purchase price of the property,

so that you can realize your dream and enter the reality of owning a home.

Payment period ranges from 3 to 20 years

You own a plot but need financing to construct a home, that excites everyone in your

family! No problem. We will provide up-to 100% of the construction cost enabling you

to say good-bye to rent forever! Even if you don't have a plot, we will provide up to 60%

of the value of the plot that you have selected to purchase.

Payment period ranges from 3 to 20 years.

You already own a home, but need extra space for a growing family or want to see some

rooms get a new look. Simply apply for financing of up to Rs. 3.50 million or 40% of

the surveyed value of your home and get yourself the extra space.

You can stretch your payments for up to 10 years.

- 20 -

The crown jewel of our Home Finance scheme, the golden opportunity for someone

starting a career to buy an already constructed housing unit early in life! We offer a

moratorium of up to 3 years in principal payments, for a financing of up to 20 years.

You service only the mark-up element initially, and principal repayment starts after the

end of moratorium period. Home Start is specially designed for young professionals to

own a quality asset.

The installment on a home finance spend all of our earning and leave you with nothing to

spend. Now don't worry anymore because we have genuinely attractive rates and flexible

payment options that could leave more funds with you each month. With our Home BTF,

repaying your home finance will not make you break into a sweat! Transfer up to 100 %

of the existing finance.

No penalty on early settlement of loan with no time limit for early settlement.

 

Convenience of Balloon payments towards adjustment of principal every month

without any extra charge or penalty (Min Rs. 50,000)

3.Credits Cards

- 21 -

Bank Alfalah Visa Card is everywhere and globally accepted and welcomed at locations

displaying the VISA logo. It is accepted at nearly 30 million merchants and 870,000

ATMs in more than 150 countries around the globe and over 10,000 establishments in

Pakistan. Alfalah VISA pays for shopping, travel, entertainment, meals and much more.

Your Bank Alfalah Credit Card is your partner everywhere and is globally accepted and

welcomed at locations displaying the VISA logo. It is accepted at nearly 30 million

locations in more than 150 countries around the globe and over 18,000 Bank Alfalah’s

establishments in Pakistan. 

Alfalah VISA lets you pay for shopping, travel, entertainment, meals and much more.

Card members are facilitated through a number of promotions from time to time. In

addition, there are a number of strategic business partnerships with leading local and

international brands for purchase of home appliances at exciting Step-BY-Step (SBS)

monthly installment plan with free home delivery at lowest interest rates. Salient features

are:

No Joining / Annual / Renewal fee

Electricity, Sui Gas, PTCL and Warid bills payment through 24 hour.

Call Center and Auto Debit instructions

SMS for card usage, mini statement, payment receipt confirmation, etc.

Cash withdrawal at all 1LINK ATMs.

Special offer on Warid post paid connections

Target Sedmentation:

- 22 -

Platinum Card  

It is accepted at nearly 30 million locations in more

than 150 countries around the globe and at over

17,000 establishments in Pakistan.

Gold & Silver  

A perfect card combination for all segments of

salaried & professional individuals.

Young Professional  

This Card is for you, if you are a Graduate

and have just started your Career.

Women Exclusive  

Now for the first time in Pakistan, Bank Alfalah

has introduced a credit card exclusively for

women. This card has its unique features.

Student Card  

For the first time in Pakistan, Bank Alfalah

introduces a credit card for Students.

  Supplementary Card  

Now you can give Free Supplementary Cards to

anyone you care for.

Visa Mini  

- 23 -

Visa Mini is a practical and convenient part of your

everyday life - whether you go for shopping, dine

out, buy grocery, want to go for holidays.

Awami Card  

Alfalah Awami Card is your partner everywhere

and is globally accepted and welcomed at locations

displaying the VISA logo. It is accepted.

Your partner everywhere and is globally accepted and welcomed at locations displaying

the VISA logo. It is accepted at nearly 30 million locations in more than 150 countries

around the globe and at over 17,000 establishments in Pakistan.

You also have the option of withdrawing cash by requesting an Over-the-Counter Cash

Advance at 3,60,000 financial institutions worldwide or at any Bank Alfalah

Branch/ATM or participating VISA member banks in Pakistan.

 

For every Rs. 50 you spend on your Alfalah VISA Card, you will earn 1 Fortune point.

Your accumulated Fortune points can be exchanged for a whole range of items displayed

- 24 -

in our Fortunes Catalogue. It offers a wide range of lifestyle categories catering to your

own and your family’s taste. 

 Schedule of Charges

The following Schedule of Charges is associated with your Alfalah VISA Platinum Card.

Please make a note of the following so that you are fully informed of the charges on your

Card.

Schedule of Charges 

Service Fee

Late Fee

Cash Payment Processing fee

Merchant Discount Charges

3.00% per month (APR 36%).3.00% per month (APR 36%).1.75% per month on SBS transactions.1.50% per month on BTF transactions.

Rs. 600/- or 10% of minimum amount, whichever is higher.

Rs. 100/- per transaction.

Upto 5% of transaction amount.

A perfect card combination for all segments of salaried & professional individuals.

- 25 -

This Card is for you, if you are:

have just started your Career...

 

not qualified for any other credit card’s income criteria...

As a Classic Blue Cardholder you have a privilege of having access to all features of

Alfalah VISA Credit Cards including two free supplementary cards.

A Credit Card Exclusively for Women..

Now for the first time in Pakistan, Bank Alfalah has introduced a credit card exclusively

for women. This card has its unique features which have been tailor-made for women in

Pakistan.

Requirements:

The requirements of this card depends on what basis this card has been applied for:

If the female is applying on her own income basis, she herself will be liable to pay

for the amount spent through the card(s).

 

- 26 -

If the female is a house wife and does not have any direct income source, she can

apply for the card through the person responsible for the household (i.e. husband

or father) who will sign an undertaking to be responsible for the amount spent

through all the card(s) issued under this scheme.

For the first time in Pakistan, Bank Alfalah introduces a credit card for Students.

This card is for you if you are enrolled in a professional university (as per Bank Alfalah’s

approved list) with 15 years of schooling experience.

Now you can pay your fee, buy books or just with Alfalah VISA... :-) Not only

this but you will also earn reward points and can redeem them for a TV, Mobile Phone,

CD player & DVDs etc.

Requirements

1. The applicant must be a graduate with 14 years of schooling and must be

currently enrolled in a professional college/University.

 

- 27 -

Supplementary CardsAll Bank Alfalah Basic Card members can apply for supplementary cards in separate

categories including Son’s Card, Daughter’s card (children who are above 13 years of

age) and House Staff’s card. This feature has been introduced for the first time in

Pakistan, yet another beginning made by Bank Alfalah Credit Cards. In addition,

supplementary cards can be issued to anyone you like thus giving you complete freedom

of choice (Only 1 supplementary card will be issued to Awami Card holder)

Distinguish Card Design for Each Category Each supplementary card category contains its own specific design of card. These card

designs which have been specifically designed keeping in view the trends and tastes of

the modern day young generation who has the desire to look exclusive in itself. You can

get supplementary cards in unique designs for your son, daughter and house staff, but any

other person can also enjoy this privilege using your own card design.

Distinguish Spending Limit for Each CategoryNot only are the card designs unique, the basic Card member can also assign a separate

percentage or amount of the total credit limit of the credit card account to each of the

supplementary cards. So, whether it is your son who needs his monthly pocket money, or

your daughter needs to make school fees payments, or your chef, chauffeur or maid is

usually the one who buys all the groceries it is you who will decide how much credit each

of them gets for it.

- 28 -

Unique Supplementary cards

There are three design categories of Supplementary cards, namely, the Son's card, the

Daughter's card and the House Staff card. This enables you to get away from the day-to-

day hassle of buying groceries, petrol, children's books, etc, as each member can then do

his or her own purchases.

Fo

rget your wallet and with Alfalah VISA Mini!

Visa Mini is a practical and convenient part of your everyday life - whether you go for

shopping, dine out, buy grocery, want to go for holidays or feel like buying something of

interest while you are out just for a jog!

You can take it with you anywhere you like with no hassle as it has a perforated hole in

the bottom left corner making it attachable to your key chain, mobile phone or other day-

to-day carry along device.

43% smaller than the regular sized credit card with the same features and benefits.

Accepted at over 30 million merchants worldwide and around 17,000

establishments in Pakistan (used on electronic POS terminals only).

Has the same security features as the regular sized Alfalah VISA credit card.

- 29 -

Your Alfalah Awami Card is your partner everywhere and is globally accepted and

welcomed at locations displaying the VISA logo. It is accepted at nearly 30 million

locations in more than 150 countries around the globe and at over 18,000 Bank Alfalah’s

establishments in Pakistan.

Alfalah Awami Card lets you pay for shopping, entertainment, meals, travel and much

more.

So what are you waiting for…!Get your Alfalah Visa Credit Card

4. Debit Cards

- 30 -

Bank Alfalah Limited presents Alfalah Hilal Card, the first Visa Electron International

Debit Card which gives an unlimited access to current / savings account with a simple

swipe at millions of retail shops and ATMs worldwide. The Alfalah Hilal Card comes

with a host of conveniences and benefits combined with the wide reach of Visa Network

enabling it to be accepted at more than 840,000 ATMs and 13 million retail outlets

around the world, making it the most acceptable Debit Card available in Pakistan.

5. Rupee Travelers Cheques

Rupee Travelers Cheques are as good as cash and are accepted at the major shops, travel

agents, hotels business establishments and all over the country and abroad. This service is

being offered to facilitate instant fund availability to travelers and business people who used

to carry a large sum of money with them.

6. On Line Banking

To provide enhanced and value added products to customer bank is constantly striving

for additional facilities. Bank provide fully automated on-line telephone banking facilities

to its customers enabling them to carry out banking transactions like balance inquiries,

statement requests, product information and exchange rate

7. Automated Teller Machine (ATM)

The Bank Alfalh offers 24 hours self service banking facilities to its customers on

country wide basis through deployment of Automated Teller Machine. This system

allows the banking facilities such as cash withdrawals, cash deposits, funds transfer,

balance inquiries, account statements. Electronic cash dispensing facilities are available

in major cities of Pakistan. All ATMs are linked through a state-of-the-art Satellite Based

Communication System which offers 24 hours real time service.

8. Islamic Banking

A separate division is a recently initiated, which operates as separate branch. It offers

Shariah Compliant products through a network of five branches, which will increase to

50 by the year 2007. Islamic Banking has launched following products with the

perception that these are in accordance with the Sharia Principles.

- 31 -

Alfalah Masharaka Homes

Murabaha Finance

Aflalah Car Ijarah

9. Corporate Financing

The portfolio concentrates on all aspects of conventional banking as well as the financial

needs of corporate sector including dynamic and high value product.

Loaning against securities

Letter of Credit

Letter of Guarantee

Demand Finance

Cash Finance

Agri financeBank Alfalah Limited acknowledging the vital role of a agriculture in the economic

development of Pakistan has designed Rural Finance Program named as "BANK

ALFALAH ZARIE SAHULAT". The product is designed to cater for multiple financing

requirements of our farming sector. BANK ALFALAH ZARIE SAHULAT is available

for Short, Medium and Long terms.

Alfalah Paidawari Zarie Sahulat

Alfalah Musalsal Zarie Sahulat

Alfalah Tractor and Transport Zarie Sahulat

- 32 -

Alfalah Machinery & Equipment Zarie Sahulat

Alfalah Aabpaash Zarie Sahulat

Alfalah Islah-e-Araazi Zarie Sahulat

Alfalah Poultry Zarie Sahulat

Alfalah Dairy & Livestock Zarie Sahulat

Alfalah Fisheries Zarie Sahulat

Alfalah Silos/ Storage Zarie Sahulat

Alfalah Marketing Zarie Sahulat

Alfalah Agri Industrial Zarie Sahulat

TELEPHONE BANKING

BANK ALFALAH gives you a service of Telephone Banking.

Telephone banking is a service provided by a financial institution, which allows

its customers to perform transactions over the telephone.

Now customers can also speak to a live representative located in a call centre or

branch. Although this feature is not always guaranteed to be offered 24/7.

In addition to the self-service transactions listed earlier telephone banking

representatives are usually trained to do what the branch was traditionally do.

On this you can do following;

Loan applications

Investment  purchases and redemptions

Cheque book  orders 

Debit card replacements

Change of address, etc

Online BankingOnline banking starts from 1998 and firstly introduced by Bank Alfalah. Online

banking (or Internet banking) allows customers to conduct financial transactions on a

secure website operated by trained personnel. Online banking solutions have many

features and capabilities in common but traditionally also have some that are application

specific for ease of the customers.

- 33 -

The common features fall broadly provide by Bank Alfalah:

Transaction, Bank Alfalah allow to performing a financial transaction such as an

account to account transfer, paying a bill, wire transfer and applications, apply for

a loan, new account, etc

Electronic bill presentment and payment - EBPP

Funds transfer between a customer's own checking and savings accounts or to

another customer's account

Investment purchase or sale

Loan applications and transactions such as repayments of enrollments

Non-transactional (e.g., online statements, check links, co browsing, chat)

Bank statements

Financial Institution Administration

Support of multiple users having varying levels of authority

Transaction approval process

Software use by Bank AlfalahBank Alfalah working with temenos software from 2009. Temenos offers a range of

quality banking software products that address clients’ needs for both today and

tomorrow.

TEMENOS T24 (T24) :

T24 is the most technically advanced banking system in the world today. It is a 24-hour

real-time banking application that provides multiple application server support to a huge

number of users. The system also eliminates the need to run End Of Day processing. It

ties together multiple channels and provides CRM functionality and true non-stop

processing in a single system.

TEMENOS INSIGHT:

Insight is a browser-based business intelligence and financial performance management

solution specifically designed for banks running T24 as their core banking system.

Insight is fully integrated with T24 so that it operates without the need for extensive

consultation, data mapping or development. It provides flexible reporting and data

- 34 -

analysis tools to enable the bank to realize the full value of its system data whilst

monitoring key performance indicators in a timely and accurate manner.

MARKETING MIX (4P’S)

The marketing analysis of the bank focus the promotional complain the 4 P’s of

marketing are also vision of the bank that it uses for its marketing (called 4 P’s) i.e.

names of 4 P’s.

Product:

The product of Bank Al Falah are its various banking services which are following

PLS & Non PLS Account(Profit loss saving accounts and nonprofit loss saving

accounts)

ATM Cards

VISA Cards

LOCKERS

Credit Extension.

Price:

The price for various services of bank is

given in the booklet “The schedule of

bank charges”. The prices at the bank are

quite competitive with those of other

bank working vertically. The Bank Al

Falah try to that they give loan at low

interest.

Placement:

The distribution channels are its employees who deal with customers. The bank has over

223 branches through which it offers services to its clients in different sectors like as:

- 35 -

Industrial sector

Agriculture sector

Commercial Areas

Small Towns

Public Organizations

Promotion:

Various promotional techniques as

advertising, personal selling etc. are used the promotional strategies of the bank vary

according to the market condition. However the following techniques are mostly used.

Sponsorships

Sports Sponsor:

Bank Alfalah beleief in the providing the quality service through the idea of "Where there is Sports, there is Al Falah"

In the arena of sports, Bank Alfalah is actively involved in sponsoring events. Sports

today not only represent healthy and clean way of life, it is big business in its own right.

The sponsoring events Sponsored by the Bank Al Falah Limited in Pakistan range from

Cricket Golf, Squash, Polo, and Volley ball, to Hockey. BAL uses attractive slogans to

prominent. Some famous Events are :

Al Falah Cup Cricket

Bank al Falah Pakistan Squash Open

Bank al Falah Polo

AL Falah Cricket Triangular Series

Event Sponsor

Social Events

BAL encourages extra-curricular activities and social events that

allows employee to have a social exchange outside the working

- 36 -

environment. In this employee are encouraged to bring their family members along,

giving them a chance to fell a part of BAL family network social events like;

Picnics

Barbeques

Sports

Cultural Tours

Actually they are creating a reference group (a group to which attached persons feel

internal recognition by telling others about that group) and doing the marketing in terms

of Word of mouth (The marketing that spread from one person to others in the circle of

its family, friends, relatives, neighbors etc). Some famous events are:

Whaga Border Trip

Lahore Basant Trip

Integrated Marketing Communications

Advertising

- 37 -

It is a non personal presentation in paid form to introduce a product or service idea Bank

Alfalah use the following tools for advertising.

TVC

BAL uses more TVC as compared to its competitors. They choose those channels for

advertisement where its target customers exist. They mostly choose those spots for TVC

at peak hours in between the News. And special in the cricket matches. The TV channels

it chooses for advertise are Sports channels like Ten Sports, and others like PTV, GEO,

ATV, ARY, etc.

News Paper

BAL uses leading newspapers that are read by the business class and the family heads.

They mostly gave there advertisement mostly on Jung, Dawn, The News, The Nation,

etc.

Journals

BAL used these journals to promote their name DAWN, STAR SPORTS etc.

Magazines

BAL used these magazines to promote their activities.

Flyers

Mostly these are using when there open a new branch in a new city or a new a scheme or

product/service is introduced. Then these are used at a large scale at the chowks, squares;

outside the shopping malls, Liberty, Pace, Super Jinnah, Blue Area, Karachi company

stop, Tariq road etc.

Billboards

This is an important source of advertisement. BAL uses this only those places that have

great importance for the business class or where mostly multinationals companies have

- 38 -

offices and the traffic spots like Mall road, DHA, Lahore Cantt, Barkat Market, Davis

Road, LDA Plaza, and Peshawar Morr.

Hooding

These are like billboards but large in size than billboards same they are using in few

places in the big cities at important places like near big flyovers, squares, big buildings,

etc

Source of Brand Equity:

Brand equity is willingness for someone to continue to purchase your brand about my

product of Bank Alfalah. We discuss how our products attained the sources of brand

Equity.

Authenticity

BAL is providing best services to its customers. It is there service of quality that within nine years of there working they become the largest branch holder with in private banks and it represents their progress.

Consistency

BAL improving its products/services with the passage of time. They provide all the

customized products/services that are needed by the low/medium level income. All types

of banking are available in all the branches. They did not give any chance to his

competitor to overcome their weakness.

Reassurance

BAL always created a true faith among their customers by giving different fatalities to

their customers (WOL, WARID post paid connections) and making good relationship by

sponsoring different events (Basant Mela, Jashan-e-Baharian) social gathering, fairs on

different occasions collection for earth quake victims, etc

Differentiation

- 39 -

The unique point that make different BAL from other banks is that they use penetrating

marketing strategy instead of skimming, they focused on that segment which is mostly

ignored by others banks. They provide all the banking facilities (car, credit cards, debit

cards, ATM cards, Home loans, Agriculture loans, study loans, etc) to a normal income

person now layman can enjoy all the facilities that he only desires. They become so

popular in banking sector that the really proof there slogan “Caring Bank”. The most

prominent point is that there name is spreading through word of mouth. So they needed

less advertisement as compared to other banks.

Identification:

BAL attained this level by recognition through his Slogan “Caring Bank”. It focused on

the layman needs and fulfill it by presenting approachable schemes of products/services.

Brand meaning:

BAL created his meaning by presenting its valuable Products/services and covers the

customer perception.

Customer responses:

Customer’s response about the BAL is resulted in increased the no of branches rapidly so

that feelings of people about BAL become strong and strong with his efficiency.

Loyalty relationship:

BAL created a strong relationship with the customers. So Al Falah becomes the largest

banks that have maximum branches (177) in limited time (1997-2009) and increases this

span consciously.　Positioning of Brand with respect to Competitors :

All banks positioned themselves at different unique edges to positioned in target

customer mind following are the positioning edges of various banks

- 40 -

ABN Bank:

They positioned themselves as for high level business and social class. They use the

skimming strategy for their growth.

Standard Charted Bank:

They positioned themselves as foreign bank there staff and environment is totally

different from the others banks. They also skimmed the market.

United Bank Limited:

They recently merged with bank Alfalah limited.

Allied Bank Limited

They got the award of bank of the year. They positioned as old trusty bank and it use a

penetration strategy to get its goals.

Bank Alfalah Limited

They positioned as fast growing bank. They used intensive penetration strategy to

position them.

HUMAN RESOURCE MANAGEMENT

Human Resource Planning

At Bank Alfalah Limited, Human Resource Planning involves a decision making in three

areas of combined activities:

Step-I The bank identifies its organizational needs and then acquires a

right king of human resource accordingly.

Step-II Bank motivates them to achieve excellent performance by giving

them different sorts of targets according to their job requirements.

- 41 -

Step-III It also creates an interactive link between the employee goals and

the organizational goals.

Recruitment and Selection

Bank Alfalah Limited recruits three kinds of employees:

1. Top Level Management

2. Trainee Officers

3. Contractual Basis Employees

Training and Development

In Bank Alfalah Ltd. the process of Training and Development consists of various other

activities like:

Training:

i. The appraisal form of an employee indicates the areas in which the

employee should be trained and developed. It also elaborates the

abilities of an employee.

ii. Management and Organization Development Division of each region

timely reviews the employees and recommends them for training

during the operations it they note any discrepancy between the desired

and actual performance. This review is performed after every quarter.

iii. Upon the request of GM (Operation), indicates which sort of training

is needed in a particular region regarding the Operation Support and

Service.

Development:

Management Skill Training

Special Training for Foreign Transferred Employees

Performance Appraisal:

It is a structured discussion between employee and supervisor. It provides an opportunity

for the supervisor to recognize an employee’s achievement, offer suggestions for

- 42 -

improvement when needed, discuss job responsibilities, define objectives, counsel for

career advancement, and justify a pay adjustment. Regarding the performance appraisal,

bank adopts both type of approaches.

Traditional Approach:

The traditional approach is primarily concerned with the overall

organization and its past performance. In Bank Alfalah, overall

performance is reviews at branch level. Each branch is liable to show its

performance in a positive direction according to set goals.

Development Approach:

This approach viewed the employees as individuals and has been forward

looking through the use of goal setting. All the employees in the each of

the branches are given a performa. Every employee working in the bank is

assigned targets, usually their target are in the form of amount. The

performances of all the branches are reviewed in the end of December.

Till yet Bank Alfalah, has no computerized system to assess the

performance of employees

Performance Appraisal Process:

The performance appraisal process in the Bank Alfalah Ltd. consists of four inter-related

steps:

i. Establish a common understanding between the manager (evaluator) and

employee (evaluate) regarding work expectations, mainly the work to be

accomplished and how those work are to be evaluated.

ii. Establish ongoing assessment of performance and the progress against

work expectation.

iii. Formal documentation of performance through the completion of a

performance and development appraisal form appropriate to the job

family.

- 43 -

iv. The formal performance and development appraisal discussion, based on

the completed appraisal form and ending in the construction of a

development plan.

Reward Management

Reward Management elaborates how people are rewarded in accordance with their value

to an organization. It is concerned with both financial and non-financial rewards. A

reward system of an organization consist of integrated policies, processes and practices

for rewarding its employees in accordance with contribution, skill and competence and

their market worth.

In Bank Alfalah the elements of reward management system are consists of Basic Pay;

the fixed salary or wage which constitutes the rates for the job. This rate is varied in a

skill based or competence based system according to the individual’s skill or competence.

The rates are fixed by managerial judgement of what is required to recruit and retain the

employee.

In Bank Alfalah there is no any concept of individual performance related pay except to

the Business Development Officer. Business Development Officers are those who are

hired at contractual basis. They are assigned different targets. If they exceed to the targets

they can enjoy the individual performance related pay otherwise they are fied.

There is no concept of bonuses, commission or over time related pay. The official timing

of bank is 09.00 AM to 06.00 PM but almost all of the employees have to work till near

08.00 PM. However, for this additional work they are not getting any additional bonuses /

over time.

Aggressive Banking

Bank alfalah expanding their network of Islamic Banking. Bank Al Baraka has been

serving the Islamic banking sector since 10 years and they have only 5 branches in

Pakistan. On the other hand bank Alfalah has established 20 branches in a year.

Motivation

- 44 -

Bank Alfalah motivating their employees by giving them comprehensive benefits and

professional environment within the organization, which enhances the performance of the

employees. Bank motivates their employees by giving 3 bonuses in a year.

BENEFITS

Monitory BenefitsMonitory benefits are given to the employees on the basis of their

performance like salary rise, cash prize.

Grade PromotionBank also provides benefit to their employees in the form of grade

promotion. Grade promotion motivates the employee to do their work

efficiently and effectively.

Abroad PostingBank benefit their employees by sending them on overseas posting where

they can enhance their professional skills and get handsome financial

benefits in terms of salary or fridge benefits.

TARGET MARKET :

Bank Alfalah target market consists of individual clients as well as a number of business

organizations. Due to different market segments, BAL’s different branches have their

target markets. To capture the import business in Pakistan, the targeted segments is valid

markets known as business & commercial hub of Pakistan. Due to specialized services

provided by BAL, and its highly competitive foreign exchange rates, most of the major

importers in this area deal with BAL. Examples include; Mughal Steel and International,

New Shalimar Steel, Vellcone International, Rana Brothers etc.

As far as the individual clients are concerned, the targeted segment is posh areas like

DHA.

BRANCH NETWORK

- 45 -

An efficient branch network is essential for achieving its target. Its plan to open 25

more branches in the year 2009, at different location in the country increasing its

network to 215 branches covering over 22 cities. Bank follows a strategy of

optimum financial and quality human resource location in order to enhance the

performance potential of all its branches.

Conventional Branches

Islamic Banking Branches

Overseas Branches

FUTURE OUTLOOK

The economic future for the country seems brighter with many key indicators

moving in a favorable direction. Investor’s confidence is recovering and

entrepreneurial activity has gained momentum. They will continue to follow

strategy based on business and deposit enhancement and network expansion

POSITIONING:

The distinguish place of product/service in target customer mind.

BAL positioned itself as caring bank and customized banking. When

customer thinks about Alfalah bank the following points come in his mind.

Consumer banking

Easy approach to all departments

Felling of self respect

Fulfill of their dreams like (build own home, buy personal cars, etc).

Guaranteed profit.

Security.

- 46 -

All these thinks are in the customer mind. Due to Alfalah aggressive growth when ever

customer think about banking sector the first bank comes in mind that would be Bank

Alfalah. Bank Alfalah bank positioned also as a fast growing. Where there is a new town

there would be the a branch of Alfalah provide maximum products/services under one

roof .

Unique Positing:Positing mean image of service/Product in customer mind it can be created by

various attributes or qualities of product /service. BAL positioned itself by a

unique way that It is in the customer mind that

BAL is aggressive growing bank

New town opened Alfalah reach their first

BAL Spreads its branches at Teasel Level in Pakistan

SWOT Analysis of Bank Alfalah

Strengths

Strengths are the core competencies of any organization & as far as BAL is concerned the

core competencies of this organization are:

Target Achievement

Policies & Procedures

- 47 -

Controlling Standards

Priorities

Rewards & Benefits

Job Security for the Employees.

Favorable, friendly & Healthy Working Environment.

Documentation System is so much accurate.

Accounting & Banking System is Accurate & Reliable one.

Weaknesses

Weaknesses are the lacking points which every organization must avoid in order to make

its operational effectiveness.

Hectic Working Environment.

Work load.

Lack of Self Marketing Department.

Low Training & Coaching.

Low incentives like bonuses overtime pay etc.

Human Resource Department is not so much effective.

Appraisal is not done frequently.

Low salary packages as compared to other banks.

Opportunities

In fact, when we study all our weaknesses critically & deeply than we come to know that

we can convert our weaknesses into strengths. So basically these are our opportunities.

The opportunities for BAL are:

On the job training & coaching sessions can be conducted.

Work sharing activities should be started so that a person who is working

continuously for 9 hours can get relax.

Marketing department should be started in order to promote the name of

BAL.

Appraisal should be conducted frequently so that employees get motivated

& do their work as a loyal employee.

Attractive salary packages should be awarded.

- 48 -

Threats

Though Bank Alfalah has a strong footing and maintain a good number of loyal

customer, still bank has threats in various sectors. When we see the possible

threats for BAL, the threats are prevailing such as:

o The conventional banks those having high growth rate and high market share

are always being a threat.

o There is an average not low turnover rate, mainly because of low incentives as

compared to the other banks.

o Large business parties have fewer attractions in being a client of BAL-IBD,

mainly because of excessive amount of documentation.

PEST Of Bank Alfalah

Political : Analysis of Political environment is very critical and this

environment has a strong influence upon the activities of any

organization in a society. Political environment strongly affects the

marketing decisions. The political stability of a country has its

impact on the consistency of policies of local government. Pakistan

has always been struggling for political stability since its creation.

Government has been changing in Pakistan many times due to

multiple reasons and most of the times Military has taken the

charge of the government. So, there are significant political risks in Pakistan. But the

positive aspect is that State bank of Pakistan has been given sovereignty and it is now an

autonomous body in making its decisions. From this perspective environment becomes

suitable and favorable for Islamic banking. BAL-IBD can make their strategies

accordingly as there is no chance for any major Change of policies in near future.

- 49 -

Economical :

Pakistani economy is good for foreign investments and it is also good for Islamic banking

sector of Pakistan. GDP rate of Pakistan is showing a consistency in upward direction

and per capita income has increased as compared to past. FDI is increasing every year.

Home economy is in recovery phase but it is showing good indicators for banking sector.

Some transactions of Islamic banking like modaraba have been promoted by giving

incentives. As Pakistani economy is showing some level of stability and consistency from

last couple of years, so it’s good sign for BAL Islamic banking as well.

Socio-CulturePakistan is situated at very important geographically location and it has a diverse culture.

Islam is the religion of majority of the population and Islam has deep and ever lasting

influences upon the culture of the people of the area. So, the life style of people and

attitudes of consumers is favorable for Islamic banking as people are religious and they

want to deal in Islamic finances. Pakistani people have a respect for their religious and

cultural celebrations. BAL Islamic banking is taking an advantage of this socio-cultural

environment of Pakistan.

Technological :

There is lack of proper infrastructure in Pakistan, for that reason different sectors are not

becoming able to cope with the technology. Banking sector has introduced a lot of

innovative services with the help of technology. Islamic banking is also on its way but it

is expanding slowly as compared with potential demand of Islamic banking.

Comparison with Competitors

Boston Consultant Group Matrix (BCG) ModelMarket share

High Low

- 50 -

Grow

th ra

te

High

Car Financing

Home Financing

Online Banking

Islamic Banking

ATM

Debit Card

Low

Deposit

Investment

Credit Cards

Rupee Traveler

Cheque

Star:

In the star, we have Car Financing Home Financing Online Banking which show the high

growth rate and high market share.

Cash Cow:

In the cash cow, we have Deposits Investments Credit Cards which show the low growth

rate and high market share.

Question Mark:

In the Question Mark, we have Islamic Banking ATM Debit Card which show the high

growth rate and low market share.

Dog:

In the Dog, we have Rupee Travelers Cheque which shows the low market share and low

growth rate.

Comparison (Car Finance)

Alfalah Bank Citi Bank

- 51 -

1-Alfalah Car installments remain same linked with KIBOR.

2-In case of booking of vehicle Alfalah bank charge installment with insurance.

3-The mark up rate of Alfalah Car is 15.50%.

1-Citi Bank Car finance installments flu-charts annually linked with KIBOR.

2-Installments start right from the first month regardless of delivery of vehicle.

3-The mark up rate of Citi Bank Car finance is 16%.

Alfalah Bank MCB Bank1-Alfalah Car installments remain same linked with KIBOR.

2-In case of booking of vehicle Alfalah bank charge installment with insurance.

3-The mark up rate of Alfalah Car is 15.50%.

1-MCB Car 4 U installments flu-charts annually linked with KIBOR.

2-Installments start right from the first month regardless of delivery of vehicle.

3-The mark up rate of MCB Car 4 U is 14.25%.

Financial Analysis/ source of finance1. Investments

Bank has classified its investments under three titles and that are:

Hold for trading: These investments are short term investments which bank has

kept for generating profit by the fluctuations in price of securities and interest rate

etc.

Held to maturity: These are the investments which have fixed or determinable

payments and bank has intention to keep them till maturity.

- 52 -

Available for sale: These are the investments which do not fall under the title of

‘Hold for trading’ and ‘Held for maturity’.

2. Advances

Loans and Advances: Bank states Loans, advances and lease investments net of

provisions against non performing advances. Provisions of specific and general

nature for operations in Pakistan are made in accordance to the rules and

regulations which have been defined by the State Bank of Pakistan. The

advances to overseas customers are handled under the prevailing rules of the

customer’s country.

Finance Lease Receivables: In lease, Bank transfers the entire risks and rewards

incidental to the owner of the assets. Bank recognizes the present value of the

lease payments under a receivable and shows them under the title of advances to

customers in the balance sheet.

3. Fixed Assets:

Fixed assets are categorized into two classes. Accounting Policies regarding these classes

have been discussed below:

Tangible Assets:

Fixed assets except office premises are recorded at cost less accumulated

depreciation and accumulated impairment losses, if any. Office premises are

recorded at revalued amount less accumulated depreciation.

Depreciation on the fixed assets is charged on straight line method.

Depreciation is estimated while keeping the amount of residual value of the

assets (if any) in the mind.

Maintenance cost and repair charges are charged to the income and

subsequent costs are stated as carrying value of the asset or under separate

head whichever is appropriate, if their period of benefits extends more than

one accounting period.

Office premises are revalued by the professionals so as to eliminate the effect

immateriality from the fair value of the assets.

Surplus from the revaluation is stated as “surplus on revaluation of the fixed

assets” and deficit is deducted from the previous value of the surplus on

- 53 -

revaluation of fixed assets. The value which exceeds from the incremental

depreciation charged to the assets is transferred to the inappropriate profits.

Gain and losses are transferred to income except those which are related to

surplus. Those are directly transferred to inappropriate profits.

Intangible Assets

Intangible assets which have finite life are stated on the balance sheet on the

cost less accumulated amortization and impairment losses, if any.

Amortization on the intangible assets is charged on straight line method on a

rate which is reviewed on the balance sheet in order to eliminate the factor of

immateriality.

The other intangible assets which have infinite life are stated on the cost less

impairment losses if any.

Financial statement analysis Operational results

All figures are in millions2008 2009 2010

Operational resultsTotal Income 31,822 35,789 40,743Operating Expenses 8,289 9,957 11,002Profit before income tax and provisions 6,906 3,831 4,711Profit before income tax 4,536 1,795 1,016Profit after tax 3,130 1,301 897

EPSBasic earnings per share (Rs.) 3.92 1.41 0.71Source: Bank Alfalah Annual report

Total income was 31,822 million in year 2008 and it has increased in the last two years.

Operating expenses has been increasing in last three years. Following the year 2008

operating expense was 8289 million, year 2009 it was 9957 million and in year 2010 it

was 11002 million. Basic earnings per share have decreased so far with 0.71 till 2010.

Profit before taxProfit before tax as you can see above, It has been decreasing in last three years. This

shows that year 2009 profit is much lower as compared to year 2008 and in year 2010

- 54 -

profit is less than year 2008. The reason being this decline is higher operating expenses

which lead its profit to cut down.

Balance Sheet

Table below shows the advances and deposits comparison as well as last three year

change.

The source of the finance or investment to the Bank Alfalah are shown in the table below:

Earning for the Bank Alfalah gets from the mark-up or the interest earned and they are the

one of the source for the Bank.

The earning for the holding of the securities also increase and increase the source of the

finance.

From the table one of the problem seen that interest earned or return from the customer for

the Bank in 2010 is lower as compare to the 2009.

But the interest from the financial institutions increase in 2010 as compare to the 2009.

CONCLUSION & SUGGESTIONS

BANK ALFALAH under

the leadership of Sheikh

Nahayan Mabarak Al-

Nahayan has made

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All figures are in millions2008 2009 2010

Balance SheetShareholders’ Equity 13,767 14,609 19,770Total Assets 328,895 348,991 389,070Advances - net of provision 171,99 191,790 188,042Investment - net of provision 88,492 75,973 99,160Deposits and other accounts 273,174 300,733 324,760

significant in building of strengthening both the corporate and retail banking sectors in

Pakistan.

BANK ALFALAH views specialization and service excellence as the cornerstone of its

strategy. The people of bank innovation, creativity, reliability, customized services and

their execution are the key ingredients for their future growth. Based on this approach,

their Treasury Division and the Structured Finance Unit have been geared to provide

specialized services to the Corporate customers. Revenues from these activities have

started yielding dividends and they expect significant growth in these areas in the coming

years. While building on their in-depth familiarity with their customers’ needs and

anticipated developments in the banking industry, the Retail and Corporate areas of their

operations will continue to provide a strong and stable base to the business of the Bank.

They are aware that they have stepped into the 21st century and they must meet its

challenges by acquiring the highest levels of Technology. They will thus be accelerating

their enable them distribute their products and services through most efficient and high-

tech means. They say that they will invest in the modern tools and substantial allocation

of resources will be made to achieve this objective during the current year. Their

programme to launch real time – on line Banking Services and introduction of ATMs at

strategic locations have been firmed up and it will be fully operational during the year

2001.

Their focus would be to constantly seek out growth opportunities through increased

quality assets and by offering a wider range of products and services to their esteemed

customers. There are significant growth opportunities for BANK ALFALAH and they are

confident in their ability to grasp them. They are committed to enhancing the

shareholder’s value and look forward with greater optimism to a prosperous future for

BANK ALFALAH

The bank maintained its position as the fifth largest bank of Pakistan in terms of total

assets. BAL’s advances witnessed sizeable growth (around 14%) funded by healthy

deposit mobilization. The growth was above the industry further strengthening BAL’s

system share. However the bank’s share in the industry’s deposit base experienced a

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marginal squeeze, attributable to its cautious approach towards deposit mobilization to

achieve a favorable deposit mix for augmenting spreads. In addition, BAL continued

expanding its consumer base with main focus on credit cards, followed by mortgage

business. Bank Alfalah Limited is a well-known and successful financial institution in the

banking sector, it is said, nothing is perfect in the world, and there is always space for

deficiencies.

Although the bank has a vast network of nationwide branches but it should spread

its branch network throughout the world especially in the countries involved in

international trade with Pakistan.

In order to compete with the other banks. ATM services should be excellent as we

can see the growing competition among the banks.

The bank should acquire the services of the highly qualified people accompanied

by lucrative incentives to promote its status as desirable in the next millennium.

In order to market its products it should accentuate to give advertisements on both

print and electronic media.

The quality of human resource lies at the center of every organization’s success

and no doubt, Bank Alfalah Limited is fully aware of the importance of a satisfied

and well-trained work force that gives completive advantage but the problem,

which I have observed, is that employees of Gulberg Branch do not have enough

knowledge about their products. Therefore, the policy of the bank should be to

continually encourage its employees for their knowledge enhancement about their

products. The state of the art training and development center at Bank Alfalah

should arrange workshops and seminars for employees at every level to empower

them professionally.

Bank Alfalah Limited operates as progressive and adaptive organization

maintaining dynamism and flexibility in all facets of its operations but in this era

of stiff competition it should consider to launch new products to attract the

customers.

Their aim should remain to provide customers with value pricing and to ensure that

quality of their portfolio is never compromised despite market pressures.

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Going forward, the bank intends to maintain the growth trend. While preserving

diversification in the credit portfolio, the management intends to deploy additional funds

in risk free avenues including direct/indirect sovereign lending. Growth in consumer

financing is expected to be fuelled mainly by the credit card business. Meanwhile, BAL

plans to add 49 new branches to its network in the near-term with primary focus to build

low cost deposit base. Though BAL’s profitability is likely to improve, it is expected to

remain under pressure on account of rapid network expansion. Meanwhile, the bank, in

addition to exploring prospects of entry into other regional countries, intends to fortify its

existing overseas operations with expansion in branch network and deployment of

complete suite of all financial products.

BAL is undergoing a revamping of its organizational structure with an aim to improving

the efficiency of decision making at all levels and enhancing the quality and timeliness of

its services. Besides, instilling a risk conscious culture is also a key objective. BAL’s

Risk Management Division (RMD) has developed Credit Initiation and Internal Rating

System (CIIRS) in accordance with Basel II for generating obligor internal ratings. CIIRS

provides technological platform for assessing credit worthiness of new and existing

customers and enables structured analysis of customer data for decision-making. The

system is currently in validation phase. Moreover, the bank is implementing Economic

Capital Framework (ECF) across the bank, which is expected to enable BAL to quantify

and attribute cost to various material risks besides facilitating in calculating the risk-

adjusted profitability of each business line.

The Bank is now over staff the building under operation is in adequate for such a large

staff as new branches opening in different part of city should be availed.

Under no circumstances cheque book should be given if the account formalities should be complete.

There are two officer involved in Cash Deposit process which is time consuming. Cashier should be given certain powers to receive cash of US$ and DM to provide prompt services.

Cheque which are drawn on Bank Alfalah Branch and returned unclear in clearing are not reflected in the statement of account of the customer. These cheques must be reflected in the account so that credibility of the customers may be assessed.

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The bank should try to give more loans to the small borrowers as the past history shows that most of the loans given to corporate borrowers have converted into bad debt

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