Allied Bank's performance and outlook in Pakistan's market. In competition with other banks.

1. THE INSTITUTE OF MANAGEMENT SCIENCES LAHORE
Topic: The Competitive Analysis of
Allied Bank Limited
,
Final Project Report
Bilal Qamar
ID: 151503
Miss Samra Ayub

2. Table of Contents
Executive Summary .................................................................................................................................. 8
Acknowledgement..................................................................................................................................... 9
Abbreviations .......................................................................................................................................... 10
Chapter 1- The Introduction
1.1 Choice of the Organization........................................................................................................... 13
1.2 About the Report .......................................................................................................................... 13
1.3 Main Focus................................................................................................................................... 14
1.4 Core Outcome............................................................................................................................... 14
Chapter 2- The Internal Analysis
2.1 Background:.............................................................................................................................. 15
2.1.1 Phases of ABL History ......................................................................................................... 15
2.2 Functional Role ............................................................................................................................ 16
2.3 Vision ........................................................................................................................................... 16
2.4 Mission......................................................................................................................................... 17
2.5 Core Values .................................................................................................................................. 17
2.6 Shareholders ................................................................................................................................. 17
2.7 Risk Management Framework ..................................................................................................... 17
2.7.1 Internal Risk Management Models....................................................................................... 18
2.7.2 Technological advancements:............................................................................................... 18
2.8 Business Management.................................................................................................................. 18
2.9 Bank’s Rating............................................................................................................................... 18

3. 2.9.1 Long-Term Rating................................................................................................................. 18
2.9.2 Short-Term rating.................................................................................................................. 18
2.10 Board of Directors........................................................................................................................ 19
2.10.1 Certifications......................................................................................................................... 19
2.10.2 Appreciations ........................................................................................................................ 19
2.11 Performance Evaluation ............................................................................................................... 19
2.11.1 Functions of the Board.......................................................................................................... 20
2.11.2 Key Performance Indicators.................................................................................................. 20
Chapter 3-The Industrial Analysis
3.1 Global Economic Perspective ...................................................................................................... 21
3.1.1 Economic challenges............................................................................................................. 21
3.1.2 US Economy Role for Pakistan ............................................................................................ 22
3.1.3 Macroeconomic indication.................................................................................................... 22
3.2 Progress Through Investments in Pakistan ................................................................................... 22
3.2.1 External Influences ............................................................................................................... 23
3.3 Defining Banks in Terms of Assets.............................................................................................. 23
Table 3.1 (banks categorization according to asset value) .................................................................. 23
3.4 Overall Industrial Performance .................................................................................................... 24
3.4.1 Non-performing Loans.......................................................................................................... 24
3.4.2 Cash and Deposits................................................................................................................. 24
3.5 ABL Business Performance in the industry ................................................................................. 24
3.5.1 Growing Assets..................................................................................................................... 25
3.6 Deliberate initiative ...................................................................................................................... 25
3.6.1 Improved Risk Management................................................................................................. 25

4. 3.6.2 CSR Initiative........................................................................................................................ 25
3.7 Developing Capital Markets......................................................................................................... 26
3.8 Allied Investment Portfolio.......................................................................................................... 26
3.8.1 Portfolio management........................................................................................................... 26
Chapter 4-The Competitive Analysis
4.1 Focused Operations ...................................................................................................................... 27
4.1.1 ATMs and Their Expansions ................................................................................................ 27
4.2 Service Quality............................................................................................................................. 27
4.2.1 Islamic Banking .................................................................................................................... 28
4.3 Human Resources......................................................................................................................... 28
4.3.1 Career Path............................................................................................................................ 28
4.3.2 Trainings ............................................................................................................................... 28
4.3.3 Gender Equality .................................................................................................................... 28
4.4 Anti-Fraud Activities.................................................................................................................... 29
4.5 Cross-border progress................................................................................................................... 29
4.6 Top 10 Banks in Pakistan............................................................................................................. 29
4.7 Comparison of Banks ................................................................................................................... 30
Table 4.1 comparison of the banks...................................................................................................... 30
4.8 Major Competitor and Benchmarking.......................................................................................... 30
4.8.1 Major Competitor.................................................................................................................. 30
4.8.2 Benchmark Bank................................................................................................................... 31
4.9 Overall ABL Performance............................................................................................................ 31
4.10 Contribution Towards Economic Progress................................................................................... 31
Table 4.2 Important Banks and their branch network ......................................................................... 32

5. Chapter 5- The Customer Analysis
5.1 Upcoming Customer Focused Products ....................................................................................... 33
5.1.1 Allied Islamic Current Account ............................................................................................ 33
5.2 Qualified Services for the Customers........................................................................................... 33
5.3 Enhanced customer services......................................................................................................... 34
5.4 Changes ........................................................................................................................................ 34
5.4.1 Cost effectiveness ................................................................................................................. 34
5.5 Digital Implementation of Banking.............................................................................................. 35
5.6 Latest System ............................................................................................................................... 35
5.7 Needs Based Offers for Customers .............................................................................................. 35
5.7.1 Convenient Customer Service............................................................................................... 36
5.8 Profit and Loss Saving Accounts ................................................................................................. 36
5.8.1 Zero Balance Requirement.................................................................................................... 36
5.9 Customer Support on Remittances............................................................................................... 36
5.10 Young Savers ............................................................................................................................... 37
5.11 Corporate Needs........................................................................................................................... 37
5.12 Mutual Funds Management.......................................................................................................... 37
5.13 Abroad Banking exposure............................................................................................................ 37
5.14 Smart Users of ABL..................................................................................................................... 38
5.15 Cash & Cheque Deposit Machines............................................................................................... 38
5.16 Allied Facility Cards .................................................................................................................... 39
5.17 Personal Finance........................................................................................................................... 39
5.18 Long Term Credit Facilitations .................................................................................................... 39
5.20.1 Bank Lockers.......................................................................................................... 39
5.20.2 Individual Interactive Point................................................................................................... 40

6. Investment Banking and Cash Management ....................................................................................... 40
5.21 Mudaraba and other Projects........................................................................................................ 41
5.22 Term Deposit Certificate.............................................................................................................. 41
Chapter 6-The SWOT Analysis
6.1 Core Strengths of Allied Bank: .................................................................................................... 42
6.1.1 Products................................................................................................................................. 42
6.1.2 Innovation: e-Banking Channels........................................................................................... 43
6.1.3 Categorized Saving Accounts ............................................................................................... 44
6.1.4 Features ................................................................................................................................. 44
6.1.5 General banking activities..................................................................................................... 44
6.1.6 Finance and credit Facility:................................................................................................... 45
6.1.7 Women Banking ................................................................................................................... 46
6.2 Weaknesses of Allied Bank.......................................................................................................... 48
Weak Online Services.......................................................................................................................... 48
Less ATMs........................................................................................................................................... 48
Less Branches ...................................................................................................................................... 48
Lack of Card Facility........................................................................................................................... 48
Weak promotions................................................................................................................................. 48
6.3 Opportunities of Allied Bank ....................................................................................................... 49
6.4 Threats of Allied Bank ................................................................................................................. 50
Table 6.1 (SWOT Analysis of ABL)................................................................................................... 51

7. Chapter 7- Conclusion and Recommendations
7.1 Concluding Remarks .................................................................................................................... 52
7.2 Recommendations ........................................................................................................................ 53
Bibliography (References)............................................................................................................. 55

8. Executive Summary
This report is the assessment of different aspects of the Allied Bank Limited. The report has been made
under different aspects including background, business activities, rating, marketing, credit and
operations.
In this project report, we have support the establishment of the banking industry in the Pakistani region.
The report contains many sorts of data which might be able to inculcate the importance of running the
sector of business finance and banking industry. Allied Bank Limited is to be the international
standards and would be able to fulfill the regional laws based on the Financial and Non-Financial
Activities in this sector of the country.
The Banking sector contributes to: GDP, Income capita, employment and in overall growth of the
country. The business of Banking is very important if it is based upon scaling, keeping an eye on every
step, and also by keeping in view the events in which transactions are needed to be proceeded
effectively. The cash amount can be transacted to other countries as well. The business development
which ABL has tried to be based in Pakistan.
Some core business techniques have also been analyzed in focus of this report. Their marketing
techniques, target audience and their products offering upon different sort of divisions. All such
elements have been analyzed and their ultimate outcome has been derived in the form of this
descriptive report.

9. Acknowledgement
Many contributions and efforts have been made in this project. However, it would not have been
possible without the kind support and help of many individuals and the organization. I would like to
extend my sincere thanks to all of them including my instructors, colleagues and supervisor.
I am highly obligated to Allied Bank Limited Officials for their guidance and supervision as well as
for providing necessary information regarding the project and also for their support in completing my
work.
I would like to express my gratitude towards my parents and my course instructor Miss Samra Ayub
for her kind co-operation and encouragement which helped me in completion of this project. She
helped and supported me with the ideas and improvements required for the making of this report.
I would like to express my special gratitude and thanks to organization persons for giving me such
attention and time. My appreciations also go to my colleague in developing the project and people who
have been willingly helping me out with their abilities.
Last but not the least, I am very thankful to Sir Hashim Sultan (Divisional HR Head) and Sir Jawad
Bin Shabbir (Group Head HR) in the Allied Bank Limited, for their kindness and encouragement.
They assisted in the formation of this report particularly related to data from their fields.

10. Abbreviations
ABL: Allied Bank Limited
ADB: Asian Development Bank
AMC: Asset Management Companies
AMDP: Allied Management Development Program
AML: Anti Money Laundering
ATM: Automated Teller Machine
BAF: Bank Alfalah
BDO: Business Development Officer
BOD: Board of Directors
BoP: Balance of Payment
BRMC: Board’s Risk Management Committee
CASA: Current Account Saving Account
CCG: Code of Corporate Governance
CCDM: Cash and Cheque Deposit Machines
CDC: Central Depository Company
CSR: Corporate Social Responsibilities
FATCA: Foreign Account Tax Compliance Act

11. FCCM: Financial Crime and Compliance Management
FI: Financial Institutions
GDP: Gross Domestic Product
HBL: Habib Bank Limited
ILL: Ibrahim Leasing Limited
IMF: International Monetary fund
JCR: Japan Credit Rating Agency Ltd
KIBOR: Karachi Inter Bank Borrowing Rate
KPIs: Key Performance Indicators
LOS: Loan Origination System
LSM: Large Scale Manufacturing
MCB: Muslim Commercial Bank
M&E: Monitoring and Evaluation
MTO: Management Trainee Officer
NBFIs: Non-Bank financial institutions
OPEC: The Organization of Petroleum Exporting Countries
PACRA: Pakistan Credit Rating Agency
PSX: Pakistan stock exchange
RAMS: risk management and assessment system

12. REI: Real-estate Engineering and Infrastructure
RM: Risk management
SME: Small & Medium Enterprise
SQ: Service Quality
TAT: Thematic Appreciation Test
TFC: Term Finance Certificates
VaR: Value-at-Risk
VIS: Vital Information Service (Pvt) Limited
w.e.f: with effective from
YoY: year on year

13. Chapter 1
The Introduction
1.1 Choice of the Organization
The organization which has been selected for the purpose of this competitive analysis is “Allied Bank
Limited”. This is one of the major banks in Pakistani banking industry. The investments, and capital
management in the history of Pakistan began from banks including Allied Bank, this is how we can
assess the significance of this bank. Like any other renowned commercial banks, ABL had a great
historical background. Its branches initially founded in Bangladesh (East Pakistan) with the parent
name of “Australasia Bank”. Right after the division of East Pakistan from Western, its branches were
disposed of and those precious assets were lost.
1.2 About the Report
This report contains the analysis of the Bank. This analysis is all about the competitiveness in the
banking industry. Competitiveness has been evaluated after some comparisons with the core
competitor, benchmark bank and the overall industrial performance. The banking industry itself is the
major industry of every economy. The significance of the industry has also been focused in this report.
Complete and comprehensive study has been done to evaluate and to judge the importance of Allied
Bank Limited. The report has been evaluated according to the arrangements in different chapters. Each
chapter has its own significance because of discrete elements in each part of this project report. Chapter
varies from background introduction to the present situation of the bank. The internal analysis as well
as the external opportunities have been discussed in this assessment.

14. 1.3 Main Focus
The major focus in this project report is to assess the internal strengths and core competencies and
comparing it with other similar organizations. The main objective of this report is to evaluate the
bank’s position through internal (strengths and Weaknesses) analysis as well as the externally
(opportunities and threats) assessment. After theses assessments, the logical conclusion has been drawn
and suitable recommendations have been given in order to make an effective outcome of this project
report.
The main focus also assesses the gain and loss of the bank which it has faced during the 65+ years of its
existence. This also encourages the clear study of the assets management, loan recovery, retail banking
and many other operations and transactions that have been made throughout the period.
1.4 Core Outcome
The main outcome of this project focuses on the enlightenment that how ABL has emerged into a
strong entity in the banking industry. This could not have been possible without the core strengths and
availing the privileged opportunities in the land of sub-continent. The core competencies and strong
foundation of the bank has made it a valuable and prominent in the banking industry of Pakistan.
Having strong base, solid foundation the bank has been offering its valuable services from more than
six decades. Which

15. Chapter 2
The Internal Analysis
2.1 Background:
Allied bank Limited (ABL) is one of the renowned banks of Pakistan. It has multiple branches in all
over Pakistan. Allied Bank is a commercial bank in Pakistan. Allied Bank, with its registered Offices in
Karachi and Lahore, having branches and ATMs exceeding 1150 it is considered as one of the largest
banking network for major cities in the country. It was privileged to be the first bank for Muslims
before independence. Its first name was Australasia Bank in 1942. The name was changed to “Allied
Bank of Pakistan” from the previous name of Australasia Bank Limited later in 1974, and its merging
partners Sarhad Bank Ltd. Lahore Commercial Bank Ltd. and Pak Bank Ltd. Were also became
partners of ABL. ABL is the first Muslim Bank established on territory that later on became Pakistan.
Before the official independence, Allied Bank was the first ever Muslim Bank in the land of Pakistan.
Based on Lahore, the initial capital deployed was one lac and twelve thousand rupees only (Rs 0.12
Million). It was established on December 3, 1942.
During the initial period, Mr. Kh. Bashir Baksh was appointed as the chairman. The background of
ABL is considered as the dedication for the banking industry and commitment in the professionalism.
2.1.1 Phases of ABL History
ABL’s past is described into various phases. Throughout 25 years of combined Pakistan, the bank
progressively advanced many ranges of its transactions and activities.
1970’s proved to be the tough period for majority of the Banks in Pakistan.
In 1971 East Pakistan was parted then renowned Australasia Bank lost its 50 branches and a huge
amount of capital was also lost. Yet, the development continued.
In 1974, all the Banks in Pakistan were state-owned as well as Australasia Bank. The minor regional
Banks were combined into Australasia Bank.

16. 1 July 1974, the beginning of a new entity which was renamed as Allied Bank Limited from that of
Australasia Bank. Formerly it started its processes as a Financial Institution for Public Sector.
2.2 Functional Role
Australasia Bank tend to be the solitary completely efficient Muslim Bank on the territory of Pakistan
on the independence August the 14th, 1947. The unrests and riots in East Punjab had been severely
hitting the bank after that. It was recognized by the Pakistan Movement. During that period of
freedom, all the divisions in India were shut-down. New Branches with new infrastructure initiated in
the cities of Pakistan like Karachi, Rawalpindi, Peshawar, Sialkot, Sargodha, Jhang, Gujranwala and
Kasur.
The Bank funded employment in mass pointer food grains and thus played essential role in upholding
customer supplies during uprising in earlier 1948. Notwithstanding the problematic situations
dominancy, Allied Bank privatized in 2004. Majority of the population were in contradiction of it but
the government administration at that time selected for the privatization of ABL.
2.3 Vision
“The vision of Allied Bank is to become dynamic and efficient bank providing integrated solutions and
it should be the first and foremost options for all the customers”

17. 2.4 Mission
“The mission is to add value to their customers and to deliver high tech advanced solutions to their
customers. The mission of Allied Bank also comprises maintainable value through growth, efficiency
and diversity for all the stakeholders. It also includes providing challenging work environment and
rewarding dedicated Team members and doing a proactive role in contributing towards the society.”
2.5 Core Values
The values of this bank include integrity, growth, excellence and high performance.
2.6 Shareholders
In May 2005, Allied Bank Limited was invested and jointed by a renowned leasing company named as
Ibrahim Leasing, Limited (ILL). The shareholders from ILL were issued by the shares of ABL after the
procedure of transfer of shares. Submission for the entry of ABL stocks in all the Stock Markets
Pakistan was finished. ABL was officially registered and listed, and transaction of the shares of the
Bank began w.e.f. the following dates after the listing.
2.7 Risk Management Framework
The Bank manages risk through a framework of sound risk management principles which includes an
optimum organizational structure, risk assessment and monitoring processes. The Risk Management
(RM) is mandated to implement this framework as a function independent of commercial lines of
business, working under the guidance of Board’s Risk Management Committee (BRMC). RM took
several steps in 2015 to further strengthen the Risk Management Framework, for example:
Upgraded the Loan Origination System (LOS) by powering credit endorsement workflows for
Commodity Operations Financing; Non-Banking Financial Institutions, as well as SME Lending
Products. Strengthened Market Risk oversight by automating the Foreign Exchange and Money Market
Counterparty, and Equity Stop Loss limit allocation and alert mechanism.

18. 2.7.1 Internal Risk Management Models
Risk Management also updated its internal risk models to evaluate expected shortfall as a measure of
assessing downside risk, as well as implemented back-testing technique for validating Value-at-Risk
(VaR) models.
2.7.2 Technological advancements:
ABL introduced the practice of carrying out technology review of various industrial sectors wherein the
existing technology/machinery of obligors is assessed through the overall technology advancement in
the globe. This initiative has further augmented the Bank’s credit assessment process.
2.8 Business Management
The tendency of winning the obligors to deliver them through the newest Vision on Leadership
Strategies and Business Management consequently. During 2015 interactive Sessions for Companies,
Commercial and SME Obligors on the following topics were delivered:
• “Challenges and Solutions for Sustainable Growth”
• “Corporate Governance and Managing Macro Economics Challenges”.
2.9 Bank’s Rating
2.9.1 Long-Term Rating
The momentum attained thus far will be continued in the future through significant investments in
human resources, technology and training. The Pakistan Credit Rating Agency Limited (PACRA) has
sustained the long-term rating of Allied Bank by AA+ (Double A Plus).
2.9.2 Short-Term rating
The short-term rating, it is at the peak level of “A1+” (A One Plus).
Throughout the year, Allied Bank Limited converted its unsecured, listed
and subordinated TFC II of Rs. 3,000 million after exercising call option.

19. Corporate Governance Rating JCR – VIS Credit Rating Company Limited has reaffirmed Corporate
Governance Rating of Allied Bank Limited as ‘CGR- 9’; the rating denotes ‘very high level of
corporate governance’. The evaluation achievement takes the deliberation and continued obligation of
the Board and management of Allied Bank Limited to uphold a comprehensive supremacy basis and
framework.
2.10 Board of Directors
2.10.1 Certifications
According to Annual Report 2015, 13 Board of Directors as more fully explained in the Director
profiles, all the members of the Board of Directors are ‘Certified Directors’ from Pakistan Institute of
Corporate Governance except for one Director who is in the process of getting this certification and
three Directors who have the prescribed education and experience required for exemption from training
programs of Directors pursuant to clause xi of CCG.
2.10.2 Appreciations
The Board of Directors would like to place on record its sincere appreciation to the outgoing Directors
Mr. Pervaiz Iqbal Butt and Mr. A. Akbar Sharifzada for their vital input and direction during their
occupancy as members of Board. The Board of Directors also greetings Dr. Muhammad Akram Sheikh
and Mr. Zafar Iqbal, having vast professional experience, to the Board as independent members.
2.11 Performance Evaluation
Performance evaluation Mechanism for the Board of Directors (BOD) is vested with the fiduciary
responsibility on behalf of the shareholders for protection of Bank’s interests, providing strategic
direction and monitoring the achievement of strategic objectives while ensuring regulatory compliance.

20. 2.11.1 Functions of the Board
The Companies Ordinance, 1984, Banking Companies Ordinance, 1962 and SBP’s Prudential
Regulations describes the role of the Board along with the Code of Corporate Governance (The Code)
in which responsibilities and functions of the Board are well defined. As required under the Code, the
Board has put in place an effective mechanism for monitoring of its performance. The Board evaluates
its performance by looking at the overall performance of the Bank.
2.11.2 Key Performance Indicators
Board of Governance has well-defined Key Performance Indicators (KPIs) in
contradiction of real routine; applicable discovery is attached in the Annual
Report 2015.
Performance criteria also focus on following areas:
I. An arrangement of comprehensive internal controls is established, which is effectively
implemented and maintained at all levels within the Bank.
II. Ensuring that vision and mission statement and corporate values are equipped and adopted.
III. A Code of Conduct is established and applied that describes satisfactory behavior, promotes
professional values and integrity for the board, senior supervisors and other employees.
IV. All business plans are appropriate and performance is monitored against these plans.
V. All the powers and purposes of BOD and its sub committees are trained as per the legal
requirements.
VI. Confirming that important policies have been expressed.
ABL is yielding with all controlling provisions in addition, during the year, self-assessment surveys
covering broad scope of the operative of the Board were filled by each executive and the outcomes
were considered upon in the Board conference to further reinforce the demonstration of the Board.
Auditors.

21. Chapter 3
The Industry Analysis
The earlier 1940s was the foundation to understand the requirement for the energetic input in the arena
of trade and industry for the Muslim community within the sub-continent. The Hindus had discovered
an impressive occurrence in these areas of industry, trade and commerce in the Sub-continent (before
division) which was completely dominated by them in 1880s. The thing was chiefly annoying for
Khawaja Bashir Bux and Abdul Rahman Malik to hear the taunt that Muslims might not be successful
bankers in the upcoming banking. They devised to reply to the challenge and grabbed lead in founding
this first Muslim bank on the soil of Punjab that was to become Pakistan in December 1942; by the
name of Australasia Bank Limited.
The initial equity of the Bank amounted to Rs 0.12 million, which was raised to Rs 0.5million by the
end of first full year of operation, and by the end of 30th June 1947 capital increased to Rs. 0.673
million and deposits raised to Rs 7.728 million.
3.1 Global Economic Perspective
3.1.1 Economic challenges
Global economy is entering into a challenging phase, leading to geopolitical shift, with the crash of oil
price and broad based slowdown in emerging markets including Brazil, Russia and China. Weak
economic growth in China, being the second largest economy, particularly exposes global growth
outlook to major downside risks; as reflected in major adjustment in global stock markets including
Pakistan. Meanwhile, modest recovery in advanced economies could not compensate the declining
growth trends emanating from volatility in global commodity prices, subdued international trade and
weakening of capital flows. It is more likely that there is an underlying shift bringing all factors into
focus; forcing central banks of various countries to devalue their currencies to support their dwindling
exports.

22. 3.1.2 US Economy Role for Pakistan
US Federal Reserve’s decision to raise interest rate in December 2015 also symbolized the end of easy
money. Steep reduction in oil price eased out pressure on oil importing countries. Persistent decline in
oil prices and steady growth in remittances, coupled with various other corrective measures taken by
the Government positively contributed in the improvement of Pakistan’s macro-economic outlook. As a
result, the Country’s GDP growth of 4.2% during FY 2014-15 remained well above compared to an
average growth rate of 3.9% during the preceding five fiscal years.
3.1.3 Macroeconomic indication
While recent macroeconomic developments running the range from an uptick in growth and lower
inflation viewpoint to development in SBP reserves to US$ 21 billion (41% YoY growth) and security
situation respectively did not go unappreciated, the pressure in the foreign exchange market requires
pragmatic steps to be taken by the Government. Current account deficit during first half of FY 2015-16
was reduced as well to 0.9% of GDP, as against 1.8% during corresponding period of last year despite
weakening trade balance on account of significant decline in exports especially in textile sector which
decreased by approximately 9% during the first half of FY 2015-16.
The consistent growth in home remittances, increased by 17% to US $ 18,454 million and foreign
inflows under multilateral arrangements with International Monetary Fund (IMF), Asian Development
Bank (ADB) and World Bank as well as issuance of Eurobonds worth US$ 500 million, also assisted in
the reduction of overall Balance of Payments (BoP) deficit by US$ 1,222 million during FY 2014-15 to
US$ 2,636 million. Further Public Debt-to-GDP ratio curtailed at 64.8% during FY 2014-15. Foreign
direct investment (FDI) reduced Chief Executive Officer’s Review substantially during FY 2014-15
and stood at US$ 851 million compared to US$ 1,700 in FY 2013-14; albeit with some recovery during
first half of FY 2015-16 with 4.6% growth against corresponding period of last year.
3.2 Progress Through Investments in Pakistan
It is expected that the China Pakistan Economic Corridor (CPEC) agreements aggregating to US$ 46
Billion, shall gradually materialize to improve FDI levels going forward. With continued strengthening
of the external payments position and progress in structural reforms, Pakistan’s economic performance
was recognized internationally through improvement in country’s rating by Moody’s Investor Service
which upgraded Pakistan’s rating to “B3” from Caa1 and assigned “Stable” outlook. During the year,

23. Government of Pakistan also initiated the merger of country’s three stock exchanges to form “Pakistan
Stock Exchange (PSX)” with a view to further develop and strengthen the country’s capital markets.
3.2.1 External Influences
External factors mainly originating from significant decline in global oil prices to as low as under US$
30 per barrel from US$ 94 per barrel in September 2014, reflecting reduction of 68% on account of
supply glut and subdued demand from major oil consuming countries. Accordingly, overall inflation
levels fell to 4.5% during FY 2014-15; the inflation levels further dropped to 2.2% during first half of
FY 2015-16.
3.3 Defining Banks in Terms of Assets
Based upon asset valuation, the banks in Pakistan are being categorized according to different sizes as
under:
1. Large Banks: Exceeding Rs 500 Billion valuation of assets
2. Medium Size Banks: Total assets valuation between Rs100 Billion to Rs500 Billion
3. Small Banks: Sum of Assets less than the value of Rs100 Billion
4. Islamic Banks: Any bank holding any of the above categorized assets (either small, medium or
large) and necessarily utilizing Islamic processes
Table 3.1 (banks categorization according to asset value)
BANK TYPES ASSETS VALUATION
Large More than Rs 500 billion
Medium Between Rs 100 and Rs 500 Billion
Small Less than Rs 100 Billion
Islamic Any of the Above Range

24. 3.4 Overall Industrial Performance
The overall industry level private sector advances grew by 8.8% YoY in 2015 to close at Rs. 3,645
billion and Large Scale Manufacturing (LSM) grew by a modest 3.3% during FY 2014-15,
approximately 1% lower than previous financial year.
3.4.1 Non-performing Loans
Non-Performing Loans for the banking sector’s as on September 2015 increased slightly to Rs.630
billion; an increase of 3.6% over September 2014 level of Rs.608 billion. The reflective tax charge not
only impacted industry’s overall profitability but also diluted the post-tax earnings growth over the
corresponding year. Further, imposition of Withholding Income Tax for non-filers of Income Tax
returns resulted in reduction in banking channel transactions’ volume during the second half of 2015.
3.4.2 Cash and Deposits
The currency in movement (circulation) during 2015 grew by 24.5% as compared to 7% during 2014.
The tendency could weaken the goals set in National Financial Inclusion Strategy 2020, to knock nearly
89% unbanked inhabitants within the country. Consequently, trade deposits growth remained under
burden during the FY 2015-16, through a major point near year end at the industry level.
There noticed an increase of Rs.370 billion in the last week ended December 31, 2015. Bank Deposits
raised by 16% at the industry surface to close the year at Rs. 9,676 billion at the close of 2015.
3.5ABL Business Performance in the industry
ABL faced improvements in CASA ratio despite of the downfall in the investments throughout the
industrial level of Banking industry. The Bank faced a healthy growth in Balance Sheet by 18% as at
December 31, 2015. The progress was attained without negotiating on asset excellence while further
establishment the liquidity profile and capital base of the bank. While it remained aware of the active
and expanded imminent expansion plans.

25. 3.5.1 Growing Assets
The volumetric development in producing assets continued a major growing driver for ABL. It added
by vigorous risk managing framework and nonstop improved to further reinforce the asset quality, state
of the art technology platform, client focused products and services and key strategic initiatives of the
Bank during the year under review.
3.6 Deliberate initiative
The planned creativity undertaken in 2014 to separately serve niche commercial markets which yield
despite of the tough and challenging market subtleties. During 2015, strong importance continued on
payments mobilization with higher focus on maintainable costing. ABL trusts in risk managing focused
towards early threatening signs to minimize against the evolving credits risks.
3.6.1 Improved Risk Management
In determination to strengthening the Risk Management and Assessment System (RAMS), ABL’s in-
house developed Loan Origination System (LOS) is being nonstop advanced, credit approval tasks
were computerized for various SME services including Allied Business Finance and Allied Fast
Finance.
3.6.2 CSR Initiative
ABL CSR initiation is to involve present and potential investors in interactive conferences implanting
knowledge about global organization best practices, corporate governance and financial management.
In this affection, five communicating seminars were held in the city of Gujranwala, Faisalabad,
Islamabad, Lahore and Karachi on the very important topics which ranging from Challenges and
Solutions for Sustainable Growth and Corporate Governance and Managing Macroeconomic
Challenges during the year activity; for diverse audiences including large Corporates and Commercial
obligors. This gathering was for the audience which were not part of ABL and hence they called it to be
among their CSR activities.

26. 3.7 Developing Capital Markets
Domestic capital markets underperformed during the year with only 2% growth witnessed compared to
an average growth of 14% in benchmark index during the preceding three years. Economic slowdown
in major developing economies, global excess oil supply, withdrawal of sanctions against Iran and its
possible re-entry in the oil exports market and supply of cost effective shale gas dragged the global oil
prices, adversely impacting overall market sentiments and in particular the shares valuation of oil and
gas sector companies.
3.8 Allied Investment Portfolio
According to the latest research available from various multilateral agencies, oil prices are expected to
remain under pressure during 2016 and may rebound to sustainable levels in 2017. The underlying
premise is that OPEC and non-OPEC members may eventually rationalize the supply glut to bring the
prices at economically viable levels. In view of the aforementioned substantial decline in oil prices,
adverse impact was witnessed in the Bank’s available for sale – equity investments portfolio. Although
the Management remains optimistic that the current prices do not reflect the correct valuation of the
investee companies; the Bank taking a prudent view recorded impairment against diminution in value
of investments.
3.8.1 Portfolio management
However, the `portfolio comprising mainly of dividend yielding strategic blue-chip scrips; despite the
extremely bearish market outlook at the moment. Fixed income securities trading business in Treasury
was further strengthened during 2015 and Allied Bank Limited was able to successfully penetrate in
this segment while realizing significant income.

27. Chapter 4
The Competitive Analysis
4.1 Focused Operations
The Bank was also able to attain “Primary Dealer” status from SBP during 2015 based on sound
performance. Allied Bank Limited continued to expand during the year 2015 with double prominence
on conventional and Islamic banking processes. banking branches proceeded to open new branches
during the year including 29 conventional and 21 Islamic branches. With the increasing banking
network to 1,023 conventional branches and 27 Islamic branches; with altogether branches of 1,050.
4.1.1 ATMs and Their Expansions
ABL continued to enhance its alternative delivery channels by addition of 125 new ATMs during the
year achieving the milestone of 1,000 ATMs to close at 1,011 ATMs. Unceasing attention was also
made in confirming one of the highest ATM in the industry while also enduring among top acquirers in
the banking industry. Allied Bank Limited persisted to determinate its strategic objective to obtain,
maintain and utilize its state of the art technology platforms for establishing the customer relationships.
With the advanced Tameness T-24 Core Banking system applied successfully across Allied Bank
Limited in 2014 it can achieve further milestones.
4.2 Service Quality
In line with Allied Bank Limited’s mission, provision of customer centric services remains at the
cornerstone of Allied Bank Limited’s strategy. The Bank’s dedicated Service Quality (SQ) function
remained at the forefront for ensuring that all customers are provided high level of service quality
through all touch points. Allied Phone Banking also served over 1.4 million customers through phone
banking and remained a critical avenue for servicing customer needs.

28. 4.2.1 Islamic Banking
Islamic Banking operations initiated in 2014, have made significant strides including formulation of
independent Shariah advisory Board comprising of Chief Executive Officer’s Review 22 Allied Bank
Limited renowned Islamic Banking Shariah scholars with a view of enhancing technology based
customer centric solutions and streamlining Islamic Banking operations by implementing T-24 plat
form with strict compliance with Shariah.
4.3 Human Resources
Allied Bank Limited values its Human Resource as a source of competitive advantage. Accordingly,
the Bank continued to enhance capacity building through development of forward looking workforce
with IT skills, giving weightage to proactive succession planning in the ‘digital age’.
4.3.1 Career Path
Extensive focus was made during 2015 to induct Management Trainee Officers (MTOs), Business
Development Officers (BDOs) and Tellers. A specialized MTOs batch, with specially designed training
program was inducted to strengthen Compliance function across the Bank. In order to focus on
improving managerial skills and define career paths, the Bank launched Allied Management
Development Program (AMDP) which consists of series of structured programs aimed at developing
general management skill set of high potential employees.
4.3.2 Trainings
Key focus was also maintained in training existing staff members with focus on improving regulatory
knowledge, enhancing soft skills and refining leadership skills through classroom based trainings,
mobile training and Bank’s in-house developed e-learning portal.
4.3.3 Gender Equality
Allied Bank Limited meanwhile continued its focus towards gender equality; female employment ratio
also reached 15% at the close of 2015. In recognition of these industry leading initiatives Allied Bank
Limited was awarded ‘first prize’ by Employers’ Federation of Pakistan in Human Resource
Development.

29. 4.4 Anti-Fraud Activities
The Bank also undertook various initiatives during 2015 to strengthen effectiveness of compliance
culture across the Bank. Improvements were made in tackling Anti-Money Laundering (AML) alerts;
ratio of resolving cumulative alerts remained over and above the satisfactory level by utilizing Oracle
based Financial Crime and Compliance Management (FCCM) module. Moreover, the Bank also
successfully achieved FATCA compliant status during the year.
4.5 Cross-border progress
Allied Bank Limited continued to make steady progress in its cross-border business during 2015; with
the focus on gradual expansion in the region. Key relationships with foreign banks were also
established during 2015 in order to achieve synergies for trade business. The investment banking
function continued to post strong performance, duly acknowledged and awarded as:
➢ “Best Investment Bank in Pakistan – 2015” by the Euro Money Magazine (UK)
➢ “Best Corporate Finance House” by CFA Society of Pakistan.
4.6 Top 10 Banks in Pakistan
According to a survey report, here is the list of top 5 banks in Pakistan for the Fiscal year 2016-17.
These banks are ranked upon their financial stability and their performance in the country.
1. National Bank of Pakistan (NBP)
2. Habib Bank Limited (HBL)
3. Muslim Commercial Bank (MCB)
4. Faysal Bank
5. Bank Alfalah (BAF)

30. 4.7 Comparison of Banks
Here is the comparison of some major competitors of ABL with respect to their number of branches in
the country. The number of branches appear the real-time assets of the banks.
Table 4.1 comparison of the banks
Banks Short Name Number of Branches
Habib Bank Limited HBL 1550+
National Bank of Pakistan NBP 1342
United Bank Limited UBL 1283
MCB Bank Limited MCB 1208
Allied Bank Limited ABL 1050
Bank Alfalah Limited BAF 423
The table above shows the number of branches each bank possesses in the country. ABL is competitive
in this matter as well. Because it handles a good number of branches in the country within its network.
This is the reason ABL is counted among the top banks within the country.
4.8 Major Competitor and Benchmarking
As far as the core competition is concerned, the bank has tough competition among other commercial
banks.
4.8.1 Major Competitor
United Bank Limited (UBL) is the core competitor for ABL. There are several reasons beside its
competition including strong workforce, commitment, quality service and the customer feedback.
Having workforce of 15000 employees and good commitment with the quality of work. UBL main
focuses on the customers’ priority which translates its slogan of “Where YOU come first”. Through this
visionary approach, the bank succeeded to get an overall profit of Rs 21 billion. It also had an EPS of
Rs17.40 during the year 2016.

31. 4.8.2 Benchmark Bank
The benchmark or the standard which ABL has set is Habib Bank Limited (HBL). This bank is the core
benchmark in the industry and majority of other banks want to see their rankings and positions at the
stage where HBL is standing now-a-days. HBL earned the highest profit level of Rs 25 Billion in the
Banking industry, which is also the industry highest point earned. Despite of the regulations and other
implementations the bank earned a huge revenue. HBL also emerged Barclays. The EPS stood at
Rs17.47 which sounds similar to that of UBL. HBL has gained a huge potential customer and
approached many cities and rural areas of the country.
4.9 Overall ABL Performance
The overall progress made by Allied Bank Limited during 2015 reflected in quality of assets, liquidity
and sustainability of the balance sheet in a challenging market place was acknowledged when Allied
Bank Limited was awarded “Strongest Bank by Balance Sheet in Pakistan” in the prestigious “Asian
Banker Strongest Bank by Balance Sheet Ranking 2015”.
4.10 Contribution Towards Economic Progress
Allied bank is playing a very good role in the economy of the country.
Hundreds of people have opened their account in Allied Bank. What
makes SWOT particularly powerful is that, with a little thought, it can
help you uncover opportunities that you are well-placed to exploit. And
by understanding the weaknesses of your business, you can manage and
eliminate threats that would otherwise catch you unawares.
More than this, by looking at yourself and your competitors using the SWOT framework, you can start
to craft a strategy that helps you distinguish yourself from your competitors, so that you can compete
successfully in your market.
Originated by Albert S Humphrey in the 1960s, the tool is as useful now as it was then. You can use it
in two ways – as a simple icebreaker helping people get together to "kick off" strategy formulation, or
in a more sophisticated way as a serious strategy tool.

32. Table 4.2 Important Banks and their branch network
Banks Short Name Number of Branches (2013)
Bank Al-Habib BAH 320
Standard Chartered Bank SCB 116
Askari Bank Limited Askari 281
Bank of Punjab BOP 334
Faysal Bank Limited Faysal 269
Habib Metropolitan Bank HMB 174
Meezan Bank Limited Meezan 351
NIB Bank Limited NIB 179
Soneri Bank Limited Soneri 239
Summit Bank Summit 187
JS Bank Limited JS 211
Bank of Khayeber BOK 100
The above table illustrates the branch network of some medium sized banks in the Banking Industry of
Pakistan. These banks are essential for economic growth.

33. Chapter 5
Customer Analysis
5.1 Upcoming Customer Focused Products
5.1.1 Allied Islamic Current Account
The current account by ABL introduced by the means of ‘Qard’ (loan) without interest based. It is a
banking account for transactions based on routine wise without any rewards or risks.
Salient Features
The valid Islamic mode of financing and investments will be proceeded when a customer will deposit
the money in the bank.
✓ Initial deposit amount is Rs1,000 for Pak Rupees Accounts
✓ No charges will be recovered at the time of closing the account
✓ Mustahkeen of Zakat (division of Zakat)
✓ No initial deposit will be required for the followings categories:
✓ Students can also open up their accounts
✓ No constraint on quantity of transactions
5.2 Qualified Services for the Customers
ABL offers some unique services in including their qualified services which can be approached
globally:
✓ Internationally accepted Visa Debit Card /ATM Card
✓ Access to Internet Banking
✓ All time access to account via Phone Banking
✓ SMS Banking
✓ SMS Alert service on transactions
✓ Facility of foreign remittances accounts
✓ Foreign currency

34. 5.3 Enhanced customer services
Information Technology, the 21st century is taking comprehensive junction of computing,
communications, information and knowledge distribution which is radically altering the way of life.
The growth of high speed networks, coupled with the viable yet astounding computing power, is
making applications possible, which were incomprehensible in the past. This explosion of technology is
rapidly transforming the banking industry from paper and branch based banks to ‘digitized and
networked’ banking services. Banking systems are being modified to the cutting edge of technology to
absorb the changing banking dynamics.
5.4 Changes
Fundamental changes are being witnessed in the dynamic delivery systems being used by Banks to
interact with their customers. Banks’ gain a vital competitive advantage by exploiting cross sell
opportunities across business lines by continuously enhancing technology driven customer service
experience through innovative customer centric product development while simultaneously using
automation to streamline business processes resulting in across the board efficiencies and reduction in
turnaround times.
5.4.1 Cost effectiveness
The costs associated with implementing state of the art technology infrastructure remain high, yet the
rewards of investing are limitless. Keeping abreast with these developments, the Bank adopted a
strategy of meeting and exceeding customer expectations through expanding the bricks and mortar
branch infrastructure duly supported by suitable emerging technologies for its software, hardware and
connectivity requirements. Allied Bank Limited is investing in latest technologies, which are being
viewed as an enabler for developing flexible structure that can respond quickly to the ever-changing
business dynamics.
An Omni-channel approach is required to cater evolving ways of self-service channels; which are
becoming primary requirements for the banking. Allied Bank Limited is also focusing on centralization
and automation of operational processes to reduce the associated costs and related operational risks
while simultaneously empowering its customers through gradual introduction of ‘Digital’ banking.

35. 5.5 Digital Implementation of Banking
Information Technology (IT) remains focused on expanding and enhancing digital delivery channels
simultaneously with conventional outreach. IT has an extensive business steadiness mechanism in place
and disaster recovery remains a high priority to ensure availability of uninterrupted around the clock
services. Allied Bank Limited is maintaining an alternate site with matching hardware and software
infrastructure to ensure business as usual and to maintain near real time data backups. All divisions of
Allied Bank Limited are online and linked with Tier+ datacenters and links to support uninterrupted
banking experience.
With the implementation of Temenos T-24; the Switzerland based core banking system across all
branches, the expanding branch network is equipped with state of the art core banking system; enabling
competitive edge. Allied Bank Limited has already initiated a core banking system upgrade process
expected to be culminated in 2017.
5.6 Latest System
During the year, IT also took initiatives to centralize clearing system, upgrade and revamp the corporate
work flow portal, redesign the corporate website, upgrade the call center and Customer Relationship
Management (CRM) solution in the organization. The continuous emphasis and investment in
technology as a strategic importance is enabling Allied Bank Limited to further strengthen and
diversify product suite, augment delivery channels, instill broad based efficiencies, comply with
regulatory requirements and create value for Bank’s stakeholders.
5.7 Needs Based Offers for Customers
Allied Bank Limited (the Bank) offers full suite of products and services, tailormade to cater to the
requirements of each segment of its customer base. We aim to provide comprehensive solutions for all
our customers, wherever they are located on their financial graph including customers just beginning a
banking relationship as well as those with more sophisticated banking needs. Branch Banking With a
vast network of over 1050 branches and 1011 ATMs, the Bank is committed to provide real time online
banking solutions to its customers in an efficient and convenient manner. Banking on Saturday &
Extended Hours Banking

36. 5.7.1 Convenient Customer Service
The Bank is amongst few banks in Pakistan offering its customers the added convenience of “full
service” Saturday Banking. The extended week of banking operations, is currently available in 287
branches; each offers a full array of personal and business banking services (except FX Transactions)
from 10:00 AM to 02:00 PM. Extended Hours Banking facility is also offered at selected branches to
enable our customers to do banking at their convenience.
5.8 Profit and Loss Saving Accounts
The Bank offers both Current account and PLS Savings Account to various customer sections, who can
avail a range of free/discounted services by maintaining certain minimum monthly average balances.
Allied Easy Current Account offers exclusive features to various customer segments, those require
banking with no minimum monthly balance requirement and offers host of free banking services by
maintaining certain minimum monthly average balances.
5.8.1 Zero Balance Requirement
ABL realizes the banking requirements of professional class clients and offers a Business Account
(Current) with free facilities on even Zero Balance. These services comprise of issuance / cancellation
of banker’s cheques, Demand Draft, intercity clearing and Nationwide Real Time online banking
business/services.
5.9 Customer Support on Remittances
The Bank fulfills the banking needs of Pakistanis receiving remittances from abroad through Allied
Express Account, with free features like;
▪ 1st cheque book,
▪ 1st ATM VISA Debit Card,
▪ Internet banking,
▪ Phone banking,
▪ Insurance coverage of beneficiary up to Rs. 500,000,
▪ No minimum balance requirement,
▪ No zakat deduction

37. 5.10 Young Savers
Allied Rising Star – Youth’s 1st Bank Account Allied Rising Star is a saving account designed for
teaching saving habits amongst the children with exclusive free features like Welcome Pack, Birthday
Gift, accidental insurance coverage up to Rs. 500,000, ATM / VISA Debit card and cheque book.
Allied Term Plus is a regular term deposit with the flexibility of tenancy and frequency of profit
payment which allows the customers to opt for investment plan which suites their choice. Salary
Management Account.
5.11 Corporate Needs
ABL knows the differentiated needs of professional customers (including medium sized business
enterprises, educational institutes, hospitals etc.) regarding their encashment of salary systems. It also
offers them rapid and well-organized payroll facility with quick
Allied Asaan Account caters to banking needs of unbanked / common people of society with simplified
account opening requirement / procedures. Customers can open current or saving account according to
their needs with free facilities like no minimum balance requirement, 1st cheque book, 1st ATM Card
and SMS Banking.
5.12 Mutual Funds Management
Mutual Funds ABL offers typical third party products; Mutual Funds investment plans and
competitive return oriented funds of Allied Asset Management Company-a wholly owned subsidiary of
ABL. The Bank is adopting modern technology and signature themes.
5.13 Abroad Banking exposure
Debit Card Variants ABL has introduced Debit Card variants that allow customers to choose from a
variety of ‘Sapphire’ packages offering widespread transactional limits on debit cards to pay for daily
basis shopping or get funds at ATMs in Pakistan and overseas. Allied SMS Banking Smartphone App
is the modern addition to the Bank’s suite of e-Banking services.

38. 5.14 Smart Users of ABL
With the growth in adoption of smartphone and also to complement users’ experience over a
smartphone, ABL launched SMS Banking Smartphone App for Android and Blackberry platforms to
facilitate technology-savvy customers and smartphone users. The SMS Banking Smartphone App
features a set of transactions including Balance Inquiry, Funds Transfer, Mobile Top-ups and Bill
Payments. Allied SMS Banking (Mobile Banking) Banking on an SMS - Whenever… Wherever! This
unique e-Banking service is a secured way of performing various financial/non-financial transactions
by sending an SMS to Allied Bank’s short code through mobile device of any sort without requiring
Internet or GPRS, thereby making banking possible anywhere, anytime with speed and security.
Allied Direct – Internet Banking at your fingertips - Allied Direct Internet Banking offers ease to
achieve with improved safety controls which offers collection of structures like fund transfers, Utility
bill payments, Mobile top-ups, Donations, Pay Anyone, e-shopping and much more.
ATMs and CCDMs (Cash & Cheque Deposit Machines) The vast network of over 1000 ATMs all over
the country gives 24/7 access to cash withdrawals, mini statement, bill payments, fund transfers and
much more.
5.15 Cash & Cheque Deposit Machines
ABL has 4 CCDMs installed at selected branches. These CCDMs offer customers the facility to deposit
cash & cheques anytime at their convenience beyond the regular banking hours. Allied Business
Finance (ABF) Allied Business Finance is a specially designed for SME sector to meet liquidity
requirements. It is available in all local branches of the Bank. Under this unique product, ABL is
offering evergreen line in shape of Running Finance, Letter of Guarantee & Letter of Credit. Term
Loan is also being offered under this product.

39. 5.16 Allied Facility Cards
Allied Visa Gold and Platinum Credit Cards are exclusively being offered to the bank’s valued branch
customers in major cities of Pakistan. Allied Visa Credit Card offers a host of privileges, benefits and
savings, together with attractive service charges and a free credit period of up to 50 days.
5.17 Personal Finance
Allied Personal Finance is a term loan facility which targets employees of bank’s current and potential
corporate / institutional customers. With a low markup rate, product offers smart financial solutions to
the customers for their immediate personal needs. Hari Bhari Agriculture Revolving Credit Scheme
This funding capacity is planned to ease the agriculturalists for obtaining Agriculture Production Loans
to meet the requirements in working capital.
5.18 Long Term Credit Facilitations
Credit is available on revolving basis against one time documentation for 3 years. Tractor Financing
This financing facility is designed to facilitate the farmers in obtaining Agriculture Development Loans
(Term Finance) for purchase of brand new Tractors.
Agriculture Finance for Dairy Farming This product is designed to support dairy farmers in meeting
working capital needs of the businesses as well as purchase of assets and construction of sheds for their
dairy farms to increase productivity and ultimately earn profits. Agriculture Finance for Poultry
Farming & Allied Activities
5.20.1 Bank Lockers
Allied Bank Lockers provide high-security protection for customers’ valuables. Lockers of different
capacities are available nationwide at conveniently located branches. Allied Bank Call Center With our
Call Centre facility, you no longer have to take time out to visit your branch for your everyday banking
needs. You can also access our self-service banking, where you will be assisted in all transactions by
our Interactive Voice Response System (IVR).

40. Allied Pay Anyone A unique product in which the Bank’s customers can send cash /cheque to any
individual in Pakistan even if the beneficiary doesn’t have a bank account. All this is done at the click
of a button through Allied Direct.
5.20.2 Individual Interactive Point
ABL official website is an interactive point that further recovers end-users’ contribution and provides
good amount of data as well as online help through ability called “Allied Live Chat”. Wide Range of
Product Division for Customers.
The Bank offers a wide range of funded and non-funded products and services to meet needs of various
types of SME businesses. Corporate Banking the Corporate Banking works on long-term relationship
based business model to provide a single point within the Bank for meeting all business requirements of
our corporate and institutional customers, including public sector enterprises, with the primary
objective of enhancing customer service.
Investment Banking and Cash Management
1. The Investment Banking (IB) support is a multi-layered business unit headed towards
fulfilling the multifaceted financing needs of its clients. Home Remittances provide a unified
arrival of foreign remittance credited in the recipient accounts in minutes.
2. Cash Management is a state of the art real - time product providing customers with efficient
Liquidity Management Solutions, across the entire network of the Bank. Treasury Products
Having attained primary dealer status, the Bank is now offering fixed income products, having
lucrative returns, to its institutional and retail clients. ABL’s treasury is an active participant in
the interbank securities trading and FX trading and provides excellent prices to customers for
their fixed income and FX needs.

41. 3. ISLAMIC BANKING Deposit Products Following key Islamic Banking deposit products are
offered by the Bank: Allied Islamic Current Account This is a chequing account that works on
the basis of “Qard” and provides the convenience of conducting day-to-day transactions. There
is no restriction on withdrawals or numbers of transactions.
5.21 Mudaraba and other Projects
Allied Islamic Saving Account is a regular chequing account on the basis of “Mudaraba” with no
minimum balance requirement. Profit is calculated on monthly average balance and credited into the
account on six monthly bases. Account can be opened separately in both local and foreign currencies
and offers a large number of free services on maintaining a minimum average monthly balance.
Allied Islamic Anmol Plus Account is a “Mudaraba” deposit product for individuals available in local
currency. Profit is calculated on monthly average balance and credited into the account on six monthly
bases. The customers can avail a large number of free services on maintaining an average monthly
balance as per defined slabs starting from Rupees 250,000. Allied Islamic Business Plus Account This
is a savings account with several unique features that make it very suitable for use as a business
account. On maintaining daily minimum balance of Rupees 50,000, the customer can avail a large
number of free services. Account can be opened in local currency only. Allied Islamic Khalis Munafa
Account This is a tier based savings account specially designed for saving purposes that offers higher
expected profits to encourage and promote higher savings. The minimum investment required for
opening an account is Rupees 1,000 only. Allied Islamic Investment Islamic Investment Certificates are
5.22 Term Deposit Certificate
Term Deposit certificates for investment periods ranging from period of 1 month to 5 years with profit
payment options of monthly, quarterly, half yearly or at maturity. Investment certificates are issued in
the multiples of Rs. 25,000 with no maximum limit. Pre-mature withdrawal can be made as per product
features. Financing Products Shariah compliant Murabaha and Ijarah financing has been introduced by
the Bank. Going forward, Bank intends to extend range of financing products by introducing Istisna,
Diminishing Musharakah and Salam.

42. Chapter 6
SWOT Analysis
SWOT Examination proves to be a convenient method for understanding internal Strengths and
Weaknesses of any organization. Also, used to understand the external opportunities and the threats
which can be bad for an organization. It helps shape a supportable niche in the market when it is used
in a professional framework. It helps to develop the personal planning as well by developing the
individual assessment for the strengths, weakness, opportunities and ultimately the threats.
6.1 Core Strengths of Allied Bank:
6.1.1 Products
ABL offers various products as well as facilities to their valued
customers. Those products which are offered by the bank as their essential strengths are as follow:
Personal Banking
This category provides Everyday Accounts, Lifestyle Banking, Savings & Term Deposits, Credit &
Debit Cards, Domestic Remittance, Banc assurance, and e-Banking Services.
Business Banking
Transaction and Business Accounts, Home Remittances to Pakistan, Cash Management Solutions,
Trade Services, SME Financing, and Agriculture Financing.
Islamic Banking
ABL has developed an Islamic banking which offers a varied range of deposit and investment related
accounts warranting the Islamic valid Shariah compliance.

43. 6.1.2 Innovation: e-Banking Channels
ABL introduces and maintains the innovative channels for their banking systems. This will help them
to develop the core competencies in the banking industry. Some of the electronic banking channels are
as under:
Allied Direct-Internet banking
Working out for the exact measurements of money circulation and to know that where does money go.
Conveniently assessing the daily routine expenditures remain priority and the everyday account which
should be able to work for you.
E-Banking Services
“Electronic touch-points to do banking around the clock” Banking on your fingertips!
The customers have developed more literate in the world of technology. ABL brings facilities that is
fitting customers’ lifestyles and offer more choice to conduct transaction. ABL distinguishes
themselves not only by offering multi-divisional channels to customers but also by attractive
experience of using those channels and find them convenient and familiar.
ABL’s electronic-Banking facilities make them well positioned in making better everyday life for
customers. They have cumulatively offered a wealth of experience and expertise in providing electronic
communications to their individual and business clients. ABL can handle more than twenty-three
million electronic dealings annually.
Security, Speed and Ease of use are the values of e-banking structure. ABL is committed to their
ability to speed their customers through to effective transactions and expand their competence levels.
While carrying out their monetary decisions. Electronic facilities differ locally as well as internationally
but the challenge resides in delivering solutions that are efficient, providing their customers with the
suitability and confidence they require in performing transactions.

44. Current Account:
This account is apposite for clients who are looking for just simple bank account for their daily routine
transactions. ABL’s Current Account, one can get all the possible rewards and features of a regular
current account for all their day to day transactions, frequent expenses and flow of capitals.
Allied Express Account:
One can now collect remittances from foreign countries with ample and peace of mind. Providing your
account number to your foreign families and friends and allowing them to concern directly into the
current account. Allied Express Account is calm and bother-free account for the Home Remittance.
6.1.3 Categorized Saving Accounts
Savings account for youths lesser than 18 years of age. It can support to save pocket-money and earn
profits on daily routine. There is too much you can do with your savings; like buying favorite books,
buy favorite toys or special gifts for mother or father, or even carry on savings.
6.1.4 Features
When you open your account, it’s in your name. You still have to take mother, father or any other
guardian’s help to use it like with:
✓ Taking cash out from the ATM or the Bank
✓ Filling the cheques
✓ Signatures
6.1.5 General banking activities
Account can be used at any time, which means one can take money out with one’s parents or guardian
help, or deposit money by themselves. They can get two accounts when they become an Allied Rising
Star. One is the main account, which has all the money that has been deposited in. The second one is
called as Wallet Account, in which all profit is being collected.

45. Withdrawal transaction is limited to Rs, 100,000/- The profit goes in the Wallet Account every day,
that means the total savings increases daily. But that’s not all, ABL also give Bonus Cash on your profit
too.
6.1.6 Finance and credit Facility:
These are short term credit services having maturity up to 1 year, lending to customers to meet their
daily routine business and working capital needs and ultimately finance their business inventories,
receivables, etc. Generally, in adding to guaranteed security, these facilities also involve security in the
form of hypothecation of stocks and pledge of stocks. Some of the local facilities include:
Domestic Remittances
Local payment or remittances is an important financial service and it is a need for many people across
Pakistan. The aim is to provide both Allied Bank account-holders and walk-in customers with a suitable
banking channel for sending money. ABL offers a domestic transfer service called “Pay Anyone”.
Customers can easily send and receive money to/from anyone within Pakistan with no compulsory
requirement for the recipient to have an account with the bank.
Procedures:
ABL customers visit their closer bank branch and fill-in the payment application form with details.
Particulars of the recipient will include Recipient Name, CNIC #, CNIC Expiry Date, recipient Cell
Number, address, sender cell number and purpose of transaction
Savings and Deposits
Saving Accounts give their customers the ability to earn profit along with the flexibility to withdraw
funds whenever you require compensating a financial alternative or need. The profit is received as per
the mechanics of Saving Accounts which are mostly on the basis of Minimum Deposit maintained in
the account. Otherwise, financing in a term deposit product gives a safety of significant that the profit
will not vary.

46. Allied Term Plus Deposits
Term Plus Deposits reward clients with a sure, highly modest profit rate for
putting their money away for a secure amount of time. View their important
product information, and find out more about our fixed Profit Rates on upholding least amount of
balance of Rs. 10,000/-
Term Deposit Mechanics
Term deposits are speculation selections offered by ABL where depositors can deposit their savings for
a certain period of time. Upon which it would be earning a specific fraction as profit. Let’s say to
decide to put the deposit for a period of one year at Allied Bank Limited. The deposit will be kept
protected till the maturity time. If it does need to extract funds prior to its maturity date, then there are
pre-mature cash withdrawal charges that will be applied at the maturity date of term deposit, that has
been chosen.
6.1.7 Women Banking
Allied Bank has introduced exclusive woman branches, which are primarily aimed at:
✓ Tapping home-grown talents.
✓ Empowering female entrepreneurs to take advantage of our tailor-made proposition for their
personal and business banking needs.
✓ Managed by female staff only, the exclusive ABL’s Women Branches cater to ladies’ banking
needs in an integrated manner amid regular banking services including guidance services,
information about various brands and credit-related counselling.

47. Youth Banking
It would be an amazing method for children and youth to get on track with saving and lifestyle banking.
It also includes the free access to Internet Banking. As a youngster or student, one have unique banking
needs. Whether they are seeing for worth, flexibility or the aptitude to save for the future,
ABL is offering a good variety of accounts to achieve the needs of their customers. Their exclusive
Youth Branches integrate variety of student-focused events such as savings, financial education and
entrepreneur growth to permit youth in Pakistan.
Why Youth Branch
Considering there are now over a billion people in the developing world between the ages of 12 and 24,
this is a critical time to harness young people’s capacity for learning, provide them with solid financial
services and understanding that will help to lift themselves and their families out of poverty. The Youth
Branch was developed to help financial service providers meet this growing need for products and
services tailored to young people.
The determination of youth banking for ABL are:
✓ To shelter the provision of opportunities for young people
✓ To bring about optimistic transformation in their own societies
✓ To endorse and care high class learning prospects
✓ To support young individuals, reach their occupied possibility
✓ To withstand Allied Bank Limited as the foremost supporter of young people to lead
management of resources, community action and decision-making.

48. 6.2 Weaknesses of Allied Bank
Despite of many strengths the bank possessed, there are many weaknesses comprising due to some
factors.
Weak Online Services
The major weakness of Allied Bank is that they have weak Online Services. This is due to the less
approach of customers towards the internet facilities. The sector has made advancements in the
Information Technology as well but ABL may not have developed in this infrastructure.
Less ATMs
They are still not able to provide the ATM service to their rural customers, which is big loop in our
banking structure. The bank is now assessing this weakness.
Less Branches
Allied Bank has less branches as compare to other banks. Bank needs to look upon the expansion upon
the branch network.
Lack of Card Facility
Another weakness of Allied bank still not provide the Credit Card and Debit Card services, which are
very necessary in this world of competition.
Weak promotions
Allied bank is not promoting its services as they should be promoted so they are under promoting their
products. Allied Bank still lacks the proper banking infrastructure

49. 6.3 Opportunities of Allied Bank
Allied Islamic Institutions Account
Purely Islamic Shariah compliant funding solution meant for Financial
Institutions (FIs) and Non-Banking Financial Institutions (NBFIs) that including Asset Management
Companies (AMC), Mutual Funds, Funds Management Companies, Mudharabah Companies, Takaful
Companies, CDCs. Those individuals who wish to earn profit on daily balance basis.
This account is to be founded on the basis of Mudharabah and it is operated like normal cheques
account on profit /loss distribution basis.
The Bank utilizes all such deposits as per the policy in Shariah compliant modes of financing /
investments. Online banking services available at the Bank’s entire network. 24/7 access to account
through Allied Phone Banking.
Salient Features
The shariah account will be functioned on the truly basis of “Mudharabah” without any minimum
balance obligation for profit analysis and not at all maintenance charges for the account.
✓ Account can be just opened in Pak Rupee Only (local currency)
✓ Profit considered on everyday balance basis
✓ Everyday balance basis means calculation of profit on each day’s cash amount in saver’s
account.
✓ Profit or Loss will be shared on scheduled monthly basis
✓ No cash will be received at the time of finishing the account
✓ Handsome initial payment amount will be required (Rs. 10 Million and above)
➢ Implementing concepts of Islamic banking
The emerging of the economic progress, the implementations of Islamic procedures have now
important as nation is now aware of the basic Islamic implementation

50. ➢ Approaching to the rural areas
There is a huge gap between the available targeted audience and the potential customers. ABL
needs to focus on the individuals who are not enjoying the banking facilities in their regions or
localities. This will enable ABL to get more potential customers
➢ Endorsing the online non-cash related transactions
As the world, has become a global village, the cash transactions are now to be converted to online
non-cash transactions. The reasons behind such advancements should be the major focus on
security threat.
➢ Supporting more categories of students and un-employed towards saving habits
ABL has the opportunities to get to know the habits of unemployed individuals. After that they should
be trained in a way to save the money. ABL has the capability to do these activities this would-be a
plus to their CSR activities as well.
6.4 Threats of Allied Bank
❖ As the deposits rates are reducing due to which people shifting their investment in Stock Market
instead of Money Market.
❖ Allied Bank facing the threat of large number of growing competitors. Such as HBL, MCB,
UBL etc.
❖ Instability in the political condition on local national and international level is also threat to lose
the customer
❖ Economic conditions of Pakistan can turn down any time which also a threat
❖ As Mirpur is situated in Azad Jammu and Kashmir and Kashmir is the bone of contention
between Pakistan and India so the foreign investor hesitates to invest in Mirpur AJK.

51. The table below shows the compact and concise overview of all the strengths, weaknesses,
opportunities and threats which have been discussed in details in above sections.
Table 6.1 (SWOT Analysis of ABL)
STRENGTHS WEAKNESSES
✓ Unique products and Services
✓ Credit Ratings
✓ Personal and Business Banking
✓ Islamic banking
✓ Technological operations
✓ Direct-approach to customers
✓ Categorical customers understanding
✓ Savings and Deposit plans
✓ Immense competition in the market
✓ Lack of ATMs operation
✓ Lesser Internet approach
✓ Less branch locations
OPPORTUNITIES THREATS
✓ Implementing concepts of Islamic banking
✓ Approaching to the rural areas
✓ Endorsing the online non-cash related
transactions
✓ Supporting more categories of students and
un-employed towards saving habits
✓ Unsupportive investment environment
✓ Customer Diversion to other banks
✓ Government taxes on transactions

52. Chapter 7
Conclusion and Recommendations
7.1 Concluding Remarks
In an overview, I would like to conclude the report by indicating the importance of ABL in the banking
industry. ABL has made a good reputation in the country as it has some differentiating in servicing the
potential customers. It means that the bank is also involved in the growth of the country’s progress.
On an individual banking level, ABL has improved its non-performing loans condition as compared to
the past years’ performance. Their employees seem to be committed to their placements in the bank’s
structure. People show good interest towards ABL because of its uniqueness in offerings and services.
The implementation of Islamic banking needed to be flourished further in the field of banking industry,
in Pakistan. ABL is playing its role in maintaining a true balance between commercial and Islamic
system of banking and transactions.
Like other banks, ABL seems to cope with the external factors in which the clients do not usually feel
comfortable. Those situations including taxation, number of transactions, online approach and many
other useful factors to determine the bank’s value proposition. ABL is effectively offering different
services under the influence of banking industry.
Creating a responsible corporate culture where the key should not be the mentality of maximizing
profits at all cost, but the banking industry’s ethical-social function with reasonable economic profits
and social benefits. Banks comply with their social function by prudently moving the assets deposited
by savers and facilitating the loans that families and businesses need to be able to grow, generate
employment and, therefore, generate wealth. When banks and financial institutions started with
excessive risk and questionable practices, they stopped performing this function, which is necessary for
society’s economic development.

53. 7.2 Recommendations
Like not a single thing is perfect, ABL also needs to have some improvements in their banking
structure. Some of the recommendations are as follow:
i. There is need to achieve a huge milestone in getting to new customers as the benchmark
(HBL) has performed tremendous role in the banking industry
ii. Competitor (UBL) achieved a handsome amount of Rs 210 billion in profits, which as
compared to ABL earned Rs150 billion during the year 2015. This indicates the way to go
for more expansion.
iii. As far as the employees and staff recommendation is concerned, there needs to strengthen
incentives and accelerate results-oriented trainings and communications program for
management and staff to encourage use of information.
iv. Identifying and support in-depth learning opportunities to develop and use results-based
approaches with task teams, particularly in challenging country cases and in complex
multisector settings.
v. Need to Provide support to task teams and technical advice to countries that intend to
institutionalize Monitoring and Evaluation (M&E) systems to strengthen the collection and
use of performance information in order to enhance their capacity and demand to manage
for results.
• Improve the timeliness of its evaluations.
• Strengthen the operational relevance of the findings.
• Increase access to and exchange of the lessons.
• Committing Bank support for institution building over the long term and ensuring
accountability for results (for example, in service delivery) in the short term
vi. Needs to enhance supporting system for wide public sector reforms and supporting selective
public management improvements in priority of service delivery
vii. Upgrading of country systems through their deliberate use and safeguarding Bank funds
from abuse of designation or corruption

54. viii. Acting with transparency and explaining relevant information, even more than is required
by law. The effect of holding toxic assets and placing preferred shares with deficient
information was devastating and it is important to show that the lesson has been learned.
Neither mortgage securitization
ix. This social function is what justified bailing out the banking industry. It may not have been
a popular decision, but if the financial system had not been bailed out and had failed, it
would have had devastating effects not only on specific banks, but also on economic activity
in general, resulting in the paralysis of society as a whole.
x. Due to immense focus on international relations, there is dire need to understand the focus
of the bank towards international exposure in the form of value added services.
xi. Cross-boundary branches will interact the customers in communicative ways. This will also
enhance the capacity of new international customers.
xii. Allied Bank should also focus on the marketing strategy, like HBL and UBL they should
enhance their marketing channels and supporting the customers according to their desired
needs.

55. Bibliography (References)
ABL Annual Reports:
2015:https://www.abl.com/download/financial_reports/financial_reports_2015/ABL-Annual-Report-
2015-Updated.pdf/
2014:https://www.abl.com/download/financial_reports/financial_reports_2014/Annual-Report-
2014.pdf/
https://www.abl.com/islamic-banking/islamic-banking-deposits/allied-islamic-current-accounts/
Internet sources:
https://en.wikipedia.org/wiki/Allied_Bank_Limited
http://filmipanda.com/top-10-banks-list-pakistan-2016-17/
http://vfast.org/journals/index.php/VTESS/article/download/301/335
http://www.abdallahshah.com/AlliedBank.html
http://www.slideshare.net/mrrizwanqamar/allied-bank-limited
http://www.slideshare.net/ZeeshanAzam/current-scenerio-of-commercial-banking-pakistan
Media Article: http://aurora.dawn.com/news/1141730/the-cpec-opportunity
http://www.studysols.pk/top-10-banks-list-in-pakistan/
https://propakistani.pk/2016/10/21/hbl-profits-cross-rs-25-billion-ubl-profit-stands-rs-21-billion-2016/
https://www.scribd.com/document/123586629/Information-Technology-in-Banking-Sector
https://www.accenture.com/id-en/~/media/Accenture/Conversion-
Assets/DotCom/Documents/Global/PDF/Industries_2/accenture-new-omni-channel-approach-serving-
customers.pdf
https://prezi.com/0efrjickrkpe/swot-analysis/?webgl=0