The Use Of Funds

Published Date: 02 Nov 2017

To serve our clients by increasing the bank’s network of branches

To strengthen the currunt system for dealing with debit cards and facilitate the incorporation of credit cards to enable the payment of salaries to all government To develop the Bank’s administrative and organizational structures and to prepare the platform for best practice corporate governance

To have an IT strategy that meets the challenges and requirements of both the bank and its clients

The role of finance group in recapitalization and subsequent restructuring of the Bank is very important. The group successfully managed the related accounting and audit requirements of merger of Ibrahim Leasing Limited (ILL) in 2005 and First Allied Bank Modaraba (FABM) in 2006.

In making the 5 years strateic plan of the bank the Finance Group played a key role. In coordination with other business groups also prepares robust annual business and operating plans. The annual budgetary exercise is done in coordination with other supporting and business groups to have a realistic but challenging budgetary targets in the back drop of economic environment and business competition. A robust monitoring mechanism to track the actual results with the budgetary targets is in place. The bank has structured management reporting system in place which gives the management key performance indicators and has drill down capability to trace variances. We have also developed MIS for various internal business segments of the Bank which helps the senior management in timely decision making and monitoring. Operations Group is well positioned to meet the challenges of the changing business environment. To achieve it, the Group is working on optimal use of information technology coupled with increased awareness of the customer’s preferences. The is involved in achieving efficiencies through reengineering the existing processes and procedures. This will allow the Bank to offer easy, convenient and hassle free products and services at most economical pricing

Organizations policies:

Policies of Askari bank:

F|INANCIAL POLICIES:

the most important policies of any bank is the financial policies which conducts whole banking activities.

These policies are primirarily conducted on:

Source of funds

Use of funds

SOURCE OF FUNDS

From the following sources the bank finance policy acquire funds:

From the deposits of account holders

Interest received from the advances and loans given to the borrowers

Income from the services provied by the bank

USE OF FUNDS

When the funds are acquired thier investement becomes necessary.the best way is seeked by the bank to generate maximum profit with the maximum security. The bank invest’s in portfolio which allocates funds for investment in the stock market ,crediting to borrowers and investment in the real estate property etc ,some banking policies have to be followed for the allocation of fundsand prudential policies by SBP.

 

A bank has to maintain liquidity with central bank, i.e. 25 % of its total deposits.

 

A bank cannot invest all of its funds otherwise it will be difficult to meet urgent needs.

 

A substantial part of funds is received from interest on loans and advances. Before granting a loan the bank analyzes and observes the borrower and conduct a complete ratio analysis.

Bank prepares credit line for this purpose the major thing is granting an advance is the security offered by the borrower and its actual market value.

Manufacturing policies

Manufacturing policies are more concerned with the Procurement policies. Banking is the service industry in this industry procurement means procurement of funds from different sources for example from deposits, which involves drawing attention to the funds of the depositors, after this aqusition of funds the bank acquire and invest in funds.he aim of the bank is to attract maximum number of accounts in this way a bank can icrease it lending , deposits and relending ability. The staff of the bank should be very efficiant in order to get maximum number of accounts the staff should take personal interest in attracting deposits.

 MARKETING POLICIES

Marketing policies are related to the growth of the organization so they are one of the most important. For a bank marketing would mean: Creation of new product and services

The marketing of the bank must be consumer oriented.

 The bank marketing must be consumer oriented. Following are the marketing policies of the askari bank:

Keeping the track of latest developments in the world and incorporating the latest and most modern equipment to make the banking procedures simple and easy for the customers.

Development of products for the customers.

Giving good services and maintaining good relations with the customers. These policies can be implemented by providing the right product and service to the customer at the right place, at the right time, at the right price. It is necessary for the managers to keep in touch with consumers, observe their needs and develop products, which meet their needs.

PROMOTIONAL POLICIES

 

Public relation and advertising has assumed a great importance in the modern banking business. The main objective of bank is to inform the existing clients and other people about its new products or change in the existing services. Askari bank establishes its purpose through:

 

Direct contact with customers.

Relation with business organizations.

Community relations.

LENDING POLICIES

 

Every bank has its own lending policies except for those, which are common for all the banks,i.e. the policies, which are imposed on all the commercial banks by the SBP, are known as prudential regulations. The lending policies of Askari bank are as follows:

 

The bank only invests in those sound and viable projects, which have good rate of return.

Bank prefers to advance loan to their account holders.

Loan is given to reliable person only.

No political loan is sanctioned by bank.

Any account holder can apply for running finance or demand finance. The manger appraises the past record of account holder and his credit worthiness. If he finds anything wrong he can refuse to sanction the amount.

The bank while taking security prefers govt. Securities to shares.

It also advances working capital loans.

PERSONAL POLICIES

 

Personal policies have an important role in the success of any organization. Askari bank has its proper personal policies. Good personal policies motivate the employees towards hardworking. Following are the main personal policies of Askari bank:

 

Selection of employees on merit

 Selection of capable employees. 

Attractive salary package for motivation of employees.

To train and develop the future management of the bank.

 Every employee must have certain set of clearly defined duties

 Effective communication at al levels of the organization

Rules & Regulations

1. As per the extant Reserves of Askari bank, which are Mandatory, photographs of all applicant(s) / Power of Attorney holders (i.e. who are authorized to operate the account(s)) should be furnished to the bank

2. As per extant of bank, PAN / Form No.60/61 (Where PAN is not available) is required to be furnished.

3. Savings Bank A/c (SB A/c) cannot be opened for business purposes as per RBI directives and hence SB a/c should be used to route transactions of only non-business / non-commercial nature. In the event of occurrence of such transactions or any other such transactions that may be construed as dubious or undesirable, the Bank reserves the right to unilaterally freeze operations in such accounts.

4. The balance in the account must adhere to the minimum monthly / quarterly average balance stipulation laid down by the Bank and communicated to you at the time of opening of the account. Nonmaintenance of such monthly/quarterly average balance will attract applicable penalty on a quarterly basis and on a date determined by the bank.

5. If there is no transaction by the account holder in the account continuously for 24 months, the account automatically gets classified as a ‘dormant / inoperative account’ whereupon further debit transactions are not permitted in the ordinary course. A request for activation of the account has to be made by the customer and the customer is subject afresh to KYC norms (proof of address).

6. If the balance in the account becomes zero and remains so continuously for three months or more, the Bank reserves to itself the right to close the account without any obligation to intimate the customer.

7. Satisfactory conduct of the account entails maintaining stipulated monthly/ quarterly average balance as well as sufficient balance to honor cheques issued to third parties. If there are high incidences (i.e. more than 3 cheque returns for want of funds) to the contrary, the Bank reserves the right to close the account under intimation to the customer.

8. Any special instructions, both financial and non-financial in nature, like standing instructions, stop payment instructions, issuance of cheque books, issuance of duplicate ATM Cards / PIN etc. must be communicated in writing. Otherwise, it shall not be binding on the Bank to comply with such instructions.

9. Any change of address should be immediately commu Any change of address should be immediately communicated in writing to the Bank. The bank will be sending through courier or post from time to time PIN mailers and any other notices / correspondences. Hence, it is incumbent upon the applicant(s) to intimate change in mailing address, if any, immediately without any loss of time. The bank will not be responsible for any loss, damage, or consequences for wrong delivery of the above items arising out of non-intimation of change in mailing address.

10. The account number is to be quoted in pay in slips / cheques issued by the account holder and in all the correspondences with the bank.

11. The account holder(s) is / are expected to verify the entries made in the pass book and draw the attention of the bank to any errors or omissions that might be discovered. The bank does not accept any responsibility for any loss arising out of failure on the part of the account holder to carry out verification of entries in the pass book and to point out such error and / or omission within one month.

Integrity:

Not accept any benefits from the estate of, or a trust created by a customer, or from an estate or trust of which Askari s Company or business units is an executor, administrator or trustee.

Conduct themselves with the highest standards of ethics, professional integrity and dignity in all dealings with the public, clients, investors, employees, and fellow bankers and not engage in acts discreditable to Askari, profession and nation.

If they become aware of any irregularity that might affect the interests of Askari, they shall inform the senior management immediately.

Maintain all books, data, information and records with scrupulous integrity, reporting in an accurate and timely manner all transactions / reports.

Avoid all such circumstance in which there is personal interest conflict, or may appear to be in conflict, with the interests of Askari or its customers.

Not use their employment status to seek personal gain from those doing business or seeking to do business with Askari, nor accept such gain if offered.

They shall not accept any gift, favour, entertainment or other benefits the size of frequency of which exceeds normal business contacts from a constituent or a subordinate employee of Aslari or from persons likely to have dealings with Askari and candidates for employment in askari

Confidentiality

Maintain the privacy and confidentiality of all the information acquired during the course of professional activities and refrain from disclosing the same unless otherwise required by statutory authorities/law.

All such information will remain as a trust and will only be used for the purpose for which it is intended and will not be used for the personal benefits of any individual(s).

Inside information about Askari’s customers/affairs shall not be used for their own gain, or for that of others either directly or indirectly.

Professionalism

Serve Askari honestly and faithfully and shall strictly serve Askari s affairs and the affairs of its constituents.

They shall use utmost endeavor to promote the interest and goodwill of ABL and shall show courtesy and attention in all transactions/ correspondence with officers of Government, State Bank of Pakistan, other Banks and Financial Institutions, others establishments dealing with Askari.

Disclose and assign to Askari all interest in any invention, improvement, discovery or work of authorship that they may make or conceive and which may arise out of their employment with Askari.

If their employment is terminated, all rights to property and information generated or obtained as part of their employment relationship will remain the exclusive property of Askari.

Not engage in Money Laundering and will be extremely vigilant in protecting Askari from being misused by anyone to launder money by strictly complying with "Know Your Customer" policies and procedures.

Business/Work Ethics

Respect fellow colleagues and work as a team. They shall at all times be courteous and not let any personal differences affect their work.

They will treat every customer of Askari with respect and courtesy.

Ensure good attendance and punctuality and demonstrate a consistently good record in this area.

For any absence during working hours, they shall obtain written permission of their immediate supervisor. They shall not absent themselves from their duties, nor leave their station over night, without having first obtained the permission of the competent authority.

Maintain a standard of personal hygiene and dress appropriately for attendance at work. Their appearance must inspire confidence and convey a sense of professionalism.

As personal responsibility, safeguard both the tangible and intangible assets of Askari and its customer(s) that are under their personal control and shall not use Askari assets for their personal benefits except where permitted by Askari.

They shall not use any Askari facilities including a telephone to promote trade union activities, or carry weapons into Askari premises unless so authorized by the management, or carry on trade union activities during office hours, or subject Askari officials to physical harassment.

Not indulge in any kind of harassment including sexual harassment or intimidation whether committed by or against any senior/junior, co-worker, customer, vendor or visitor.

They shall not use language, written or spoken in intra office communication(s)

or communication(s) with individual(s) outside the office that may contain any statement or material that is offensive to others.

They shall never use Askari’s system to transmit or receive electronic image or text containing ethnic slurs, social epithets or anything that might be construed as harassing, offensive or insulting to others.

To meet their responsibilities to fellow employees, customers and investors they shall help in maintaining a healthy and productive work environment and shall not engage in the selling, manufacturing, distributing, using, any illegal substance or being under the influence of illegal drugs while on the job.

Ensure strict adherence to all health and safety policies as may be implemented from time to time by Askari.

Not to give any interview in the print/electronic media or have their photograph displayed or act in television / stage plays or in cinema without having permission from the competent authority.

Intimate Human Resource Group of any changes in the personal circumstances relating to their employment or benefits.

Employees shall also not indulge in any of the following activities except with the prior permission of the competent authority:

Borrow money from or in any way place themselves under pecuniary obligation to broker or moneylender or any employee of Askari or any firm or person having dealings with Askari.

Buy or sell stock, share or securities of any description without funds to meet the full cost in the case of purchase or scrips for delivery in the case of sale. However, they can make a bona fide investment of their own funds in such stock, shares and securities as they may wish to buy.

Lend money in their private capacity to a constituent of Askari or have personal dealings with a constituent in the purchase or sale of bills of exchange, Government paper or any other securities.

Act as agent for an insurance company otherwise than as agent for on behalf of Askari

Be connected with the formation or management of a joint stock company.

Engage in any other commercial business or pursuit either on their own account or as agent for another or others