PIMSAT 2011

A REPORT ON UNITED BANK LIMITED

Submitted To
Mr. Azam Mehmood
(Course Instructor)

Submitted By
Spencer Pervaiz Karanjia
Aurish B.Patel
Syed Manzar Abbas
Moin uddin

Date Of Submission
May 2011
 LIST OF CONTENTS

S. No. Description Page

No.

Acknowledgment I
Preface II
List of Acronyms III
Executive Summary
Chapter – 1
INTRODUCTION OF BANKING SYSTEM
1.1 Definition of bank
1.2 Banking History
1.3 Banking System in Pakistan
1.4 Role of Commercial Banks
Chapter – 2
INTRODUCTION OF UBL
2.1 Company mission & vision
2.2 Company introduction, description & history
2.3 Domestic & International Network
2.4 Ownership Structure
2.5 News Publication
2.6 Company set up
2.7 Board of Directors
2.8 Management & Senior Management
2.8 Location & Company profile

Chapter – 3
INVESTMENT PLANS BY UBL
3.1 Mahana Munafa Plan
3.2 Sarmaya Izafa Plan
3.3 Profit + Growth Plan
3.4 Mera kal UBL Children Saving Plan
3.5 UBL Principal Plan protection series

Chapter – 4
SERVICES OF UBL
4.1 Net banking
 4.2 Hamrah
4.3 UBL Better Life Banc- assurance Investment banking
4.4 UBL Cash line
4.5 Investment banking
4.6 UBL Auto loans
4.7 Home & Business Loans
Chapter – 5
Financial Analysis of UBL
5.1 Balance Sheet Of UBL
5.2 Profit & Loss Account of UBL
5.3 Financial Analysis of UBL
5.4 Profit & Loss Account of UBL

Chapter – 6

6.1 Strategic Analysis

6.2 Financial analysis
6.3 Credit Ratings
6.4 Awards given to UBL

Conclusion 92
Suggestions & Recommendations 93-94
Appendix -
We are thankful to Almighty Allah, who has given us the
power of knowledge and we are thankful to our parents, who
supported us in every field of life and enable us to reach
points. Our sincere gratitude to our course instructor Mr.
Azam Mehmood for help, support, encouragement and his
backup at every aspect that enabled us to successfully
complete this Report, Without his help we never been enable
to complete this report. His sincere advices had us towards
the success.
This Report presents the work. Its goals is to provide
knowledge of Financial Institution, We provide thorough and
complete coverage of this Report by using straight forward
current situation and backgrounds. It covers 11chapters:
1. Introduction of banking system
2. Introduction of United bank limited
3. Investments plans by UBL
4. Services of UBL
5. Financial analysis of UBL
We hope you will enjoy reading this report that is
the reader may be able to appreciate us, we hope you will
understand and appreciate how Financial Institution
Report can be strategically planned and managed.

Yours Truly,
Spencer Pervaiz Karanjia
Aurish B.Patel
Syed Manzar Abbas
Moin uddin

EXECUTIVE SUMMARY
To properly fulfill the requirements of the commercial banking and
exercise control over banking sector, State Bank of Pakistan was
established in 1948. After the introduction of State bank different
commercial banks came into progress amongst which one was
united bank limited so due to this we select UBL as a main
financial institution on which we work further so basically firstly
we plan to gather all the relevant data regarding to our financial
institution then we gather all data and do analysis.
We are applying different techniques which are BCG Matrix and
Ratio analysis. At the end of every report it needs conclusion and
gives suggestions and recommendations.

CHAPTER 1
 INTRODUCTION OF BANKING
SYSTEM

Chapter# 1
 Introduction of Banking System


Definition of Bank
Banking History
Major events in banking History
Oldest Private Banks
Oldest National Banks
Banking System in Pakistan
Role of Commercial Bank
 “BANK”
Definition:
“A bank is a financial institution licensed by a
government. Its primary activities include borrowing and
lending money. Many other financial activities were
allowed over time. For example banks are important
players in financial markets and offer financial services
such as investment funds.”
“BANKING HISTORY”
Major events in banking history:
• Earliest Euro wide /Mideast banking 1100-1300.
• Banknotes — Introduction of paper money.
• 1602 - First joint-stock company, the Dutch East India Company
founded.
• 1720 - The South Sea Bubble which caused a European financial
crisis and forced many bankers out of business.
• 1781 - The Bank of North America was found by the Continental
Congress.
• 1800 - Rothschild family founds Euro wide banking.
• 1930-33 In the wake of the Wall Street Crash of 1929, 9,000 banks
close, wiping out a third of the money supply in the United States.
• 2008 - Washington Mutual collapses. It was the largest bank failure in
history (Financial Crises).

Oldest private banks:

• Monte dei Paschi di Siena 1472 - present, the oldest surviving bank in
the world. Founded in 1472 by the Magistrate of the city state of
Siena, Italy.
• C. Hoare & Co founded 1672
• Barclays, which was founded by John Freame and Thomas Gould in
1690 and renamed to Barclays by Freame's son-in-law, James
Barclay, in 1736
• Rothschild family 1700 - present
 • Wegelin & Co. Private Bankers 1741 - present, the oldest Swiss bank,
founded in 1741 in St. Gallen, third largest private bank in
Switzerland
• Hope & Co., founded in 1762

Oldest national banks:

• Bank of Sweden — The rise of the national banks, began operations
in 1668
• Bank of England — The evolution of modern central banking
policies, established in 1694
• Bank of America — The invention of centralized check and payment
processing technology
• Swiss banking
• United States Banking
• The Pennsylvania Land Bank, founded in 1723 and receiving the
support of Benjamin Franklin who wrote "Modest Enquiry into the
Nature and Necessity of a Paper Currency" in 1729[1].
• Imperial Bank of Persia (Iran) Founded in 1888 and was merged in
Tejarat Bank in 1979 — History of banking in the Middle-east.

In history of banking there was no concept of Pakistan because Pakistan

came into being 14th August 1947 so we can take some knowledge on
current scenario of Pakistani Banking.

“BANKING SYSTEM IN
PAKISTAN”
The banking system is passing through a difficult phase mainly because of
excessive political interference in the working of the nationalized banks by
the different governments in the past. Hence the political interference in
nationalized banks did not allow them to carry out their business purely
on merit. It may be recalled that some twenty years back, the banking
system was working on such a solid ground that various developing and
under-developed countries used to take guidelines from Pakistani
banks.

A little earlier before the creation of country, the role of Muslims of the
areas which were later included in Pakistan was of no significance due to
their restricted participation in the banking sector. There was only a small
bank namely Australasia Bank having a few branches in Lahore and its
suburbs. In 1942, the Australasia bank was housed in a garage of a trader of
Lahore who used to trade at a small scale with Australia during that period.
However the only Bank was run by the Muslims of the sub-continent was
Habib Bank which was established in 1941. At that time Quaid-e-Azam
Mohammad Ali Jinnah expressed his desire that another Muslim bank
also be established in Calcutta which came into reality when Adamjee
with the assistance of Isphanis established Muslim Commercial Bank a
few months before the creation of Pakistan in Calcutta. When Pakistan
came in to being The Habib Bank shifted its Headquarters from India
to Karachi. A few of Habib Bank's branches were already in operation in
Pakistan. The Muslim Commercial Bank also moved its headquarters
from Calcutta to Dhaka and later on to Karachi. At the time of
independence, another small bank namely Bank of Bahawalpur also started
business from Bahawalpur from December 1947.

Before independence, the financial sector was in the hands of foreign banks
some of them were British by origin. The oldest bank operating from 1883
in this part of the world was the Chartered Bank while another bank namely
the Grind lays Bank which was also working simultaneously from 1883. In
order to expand its business operations, the Grind lays acquired other small
banks and merged them into the business of Grind lays. For example Allied
Bank, National Bank of India etc was merged into Grind lays Bank. Among
the contemporaries, Imperial bank of India was the largest Indian Bank
which had started its operations in 1919 which was discharging the role of a
commercial banks as well as the Central Bank for India until an independent
Central Bank i.e. Reserve Bank of India was established in 1935.
However, since the Imperial Bank had the largest network of its branches all
over India, it continued to play its role as a subsidiary of the Reserve Bank
of India. In the Muslim majority an area which was later on became the part
of Pakistan, small branches of Indian banks were operating and soon after
creation of Pakistan they shifted their branches and headquarters to India. At
the time of independence, two major banks including Punjab National Bank
at Lahore and Comila Banking Corporation were working in the then East
Pakistan. This trend was so obvious that the total number of bank offices
between June 30, 1918 and August 14, 1947 were reduced from 631 to 195
only. During the early part of 1949 the number of branches of Imperial Bank
of India in Pakistani areas was more than of Habib Bank. In the early days of
Pakistan, the government worked hard left no stone unturned to establish
and strengthen the banking system in Pakistan.

These efforts resulted in the establishment of State Bank of Pakistan

which was inaugurated by Quaid-e-Azam on July 1, 1948. Quaid-e-Azam
flawed from Quetta to Karachi specially to grace the occasion. Originally
the State Bank was scheduled to be established in September 1948.
Zahid Hussein, who was the first Governor of the State Bank devoted
all his time and energy to streamline the working of the State Bank. In
normal situation, the Central Bank of a country is only established when the
commercial banking start working on sound footings. But the circumstances
forced the government to establish Central Bank and the task of stabilizing
the commercial banking was also assigned to the State Bank, which it really
did.

The establishment of the National Bank of Pakistan in 1950 on the

pattern of Imperial Bank of India was yet another milestone in the banking
history of Pakistan. In September 1949 the rupee value was reduced
against the Pound sterling which was a major event in the banking
circles. Consequently Indian government devalued its Rupee against Pound
Sterling’s, however Pakistan decided not to devalue its currency against
Pound Sterling which resulted in increase of Pakistani cotton and jute
prices for India which affected our exports to India. Though Pakistan had
to suffer economically due to decline of exports to India, it however gave
a sense of economic independence to Pakistan. Cut in imports from Pakistan
proved as a blessing in disguise as Pakistan had to explore new exports
markets for its products. However Indian banks operating in Pakistan
refused to finance Pakistani exports.
 “ROLE OF COMMERCIAL
BANK”
A commercial bank is a type of financial intermediary and a type of bank.
Commercial banking is also known as business banking. It is a bank that
provides checking accounts, savings accounts, and money market accounts
and that accepts time deposits.

Commercial banks engage in the following activities:

• processing of payments by way of telegraphic transfer, EFTPOS,

internet banking, or other means
• issuing bank drafts and bank cheques
• accepting money on term deposit
• lending money by overdraft, installment loan, or other means
• providing documentary and standby letter of credit, guarantees,
performance bonds, securities underwriting commitments and other
forms of off balance sheet exposures
• safekeeping of documents and other items in safe deposit boxes
• sale, distribution or brokerage, with or without advice, of insurance,
unit trusts and similar financial products as a “financial supermarket”
• traditionally, large commercial banks also underwrite bonds, and
make markets in currency, interest rates, and credit-related securities,
but today large commercial banks usually have an investment bank
arm that is involved in the mentioned activities.
 CHAPTER 2

INTRODUCTION OF UNITED BANK

LIMITED
Chapter# 2

Introduction of United Bank Limited

Company Mission
Company Vision
Company introduction
Company Description
History of the Company
Operational Structure
Domestic & International Network
 Major Local Market Presence
 House hold name
 Full Service bank
 International bank
Ownership Structure
Economic Review
Company Setup
Board of Directors
Management
Senior Management of UBL
Location
Company Profile

“MISSION STATEMENT”
Our mission is to:

Set the highest industry standard for quality across all areas of operation,
on a sustained basis;
 Optimize people, processes and technology to deliver the best possible
Financial solutions to our customers;
 Become the most sought after investment;
 be recognized as the employer of choice.

“VISION STATEMENT”

“To be a world class bank dedicated to excellence, and to

Surpass the highest expectations of our customers and all
other stakeholders.”
Company Introduction:
UBL was set up in 1959 and is today one of Pakistan's major banks in terms
of deposits and advances with a huge domestic and international network.

Company Description:
UBL is a Banking Company, which is engaged in Commercial & Retail
Banking and related services domestically and overseas.

History of the Company:

UBL was established in 1959 and is one of the major commercial banks of
Pakistan. The Bank is making every effort to meet the up-coming challenges
through strategic planning and making the best use of the resources at its
command. A professional team was appointed in mid 1997 to restructure the
bank and to commence rightsizing. The management is also in the process of
rationalizing the branch network and identifying and recovering its doubtful
and classified portfolio. It has planned to institute major improvements in
customer services and internal systems to improve efficiency. It also intends
to launch innovative products. The bank is increasing resource mobilization
through regular deposit campaigns and accelerating the process of recovery
of outstanding advances and non-performing assets.

Operational Structure:
UBL operates 1375 domestic and a subsidiary viz. United Executors and
Trustees Company Ltd. as on 30.06.2000. It has 20 overseas branches
situated in the UK, USA, UAE, Yemen, Bahrain and Qatar. It also operates
one offshore branch in the Export Processing Zone, Karachi and it has
representative offices in Cairo-Egypt and Tehran-Iran. It also has a joint
venture – Oman United Exchange Co., Oman Muscat and a subsidiary –
United Bank A.G. Zurich, Switzerland set up in 1968. It has 21 ATMs with
8 in the UAE, 3 in Bahrain, 1 in Doha, 7 in Islamabad and 2 in Karachi.

Domestic and International Network:

• Major Local Market Presence: UBL is one of the largest
commercial banks in Pakistan representing approximately 09% of the
deposits of the banking sector.
• A Household Name: UBL's brand name is well established. It has an
extensive domestic network of 1,375 branches reaching virtually
every segment of the Pakistani economy.
• A Full Service Bank: UBL provides its customers a complete range
of banking products and services including retail banking, corporate
and institutional banking, trade finance and consumer finance.
• An International Bank: UBL has a presence globally through an
extensive international branch network in the table below:
Location No of Branches
UAE (Total Branches: 8)
Abu Dhabi 4
Dubai 3
Sharjah 1
Bahrain (Total Branches: 3)
Manama 1
Babul Bahrain 1
Moharrak 1
Qatar (Total Branches: 1)
Doha 1
Yemen (Total Branches:2)
Sana 1
Hudiada 1
UK (Total Branches: 4)
London 1
Bradford 1
Manchester 1
Birmingham 1
USA (Total Branches:1)
New York 1
Export Processing Zone (Total Branches: 1)
Karachi 1
Ownership Structure:
Share holders are contributed the percentages are given below:
Shareholder Percentage (%)
State Bank of Pakistan 99.575880
Islamic Republic of Pakistan 0.370316
State Life Insurance Corp. of Pakistan 0.013895
Sui Southern Gas Company 0.013096
Pakistan Insurance Corporation 0.000113
Metropolitan Steel Corporation Ltd. 0.000430
Investment Corporation of Pakistan Ltd. 0.007634
National bank of Pakistan Trustee Department, H.O. 0.018445
President of Pakistan through Privatization Commission 0.000190
Outstanding Shares (146,388,000) 100

News Publications
United Bank Limited - a brief introduction
In April, 1998:

UBL opened up for business on November 7, 1959 with authorized capital

of Rs.20 million and Paid-up capital of Rs.10 million. In its very first year, it
mobilized deposits of Rs.70 million and earned a profit of Rs.O.7 million. It
continued to grow rapidly and soon became one of the largest banks in the
country. The main reasons for its exemplary growth were the introduction, in
many instances for the first time in Pakistan, of professional management,
computers, economic and business research, latest managerial practices and
customer orientation.

UBL remained in the private sector for 15 years until it was nationalized on
January 1, 1974 with other Pakistani banks. The bank continued to grow
rapidly even after nationalization. Its resource base expanded, the number of
branches increased, and overseas operations grew. As an organization, UBL

has grown rapidly except in the last couple of years when it ran into some
problems.

In 1996, its deposits totalled Rs.105.9 billion; advances amounted to Rs.68.6

billion; assets totalled Rs.177 billion and the number of branches was 1701,
including 27 overseas branches. UBL has had its share of problems, most of
which were the result of the conglomeration of some unpredictable factors.
More recently, the lacklustre growth of the economy has undermined the
banking sector's profitability and competitiveness.

UBL's new management has developed a well-thought-out plan for its

growth and profitability. In the main, it focuses on accelerated loan
recovery, surplus asset disposal, improving credit systems, operational
controls, reporting and monitoring. From a practical standpoint, the use of
better technology, focusing on the appropriate market segment, and project
and specialized finance will facilitate rapid and sustainable growth. The
world's financial system or, to use the latest jargon, financial architecture,
has changed greatly. New products have been introduced, the riskiness of
financial systems has increased and the lines of demarcation between the
various types of financial institutions have become blurred.

Improvement in consumer service and prompt attention to customer needs

lie at the heart of UBL's promotional strategy. All planning is directed and
geared to customer service and satisfying the client's diverse needs. The
UBL of the past was renowned for its customer service and the management
plans to put new life into it. To that end, training programmes have been
accelerated and upgraded and the staff are encouraged to revamp their skills.

The steps taken to shore up UBL have begun to take effect. The first signs of
recovery have become manifest. A key indicator is the level of recovery. In
1997, total debt settlements amounted to Rs.7 billion, well above the level in
the preceding year. In 1998, UBL's target for debt settlement is Rs.11.5
billion.
The Bank's Paid-up capital is Rs.1.48 billion. It is not enough to meet capital
adequacy ratio, but the package the State Bank of Pakistan has put together
to shore up UBL will provide Rs.21 billion to increase the capital base. This
huge infusion of capital would improve the Bank's liquidity and boost public

confidence. In turn, it would enable it to step up deposit mobilization,

expand its activities, pay depositors a higher return, and upgrade technology.
All of these would impact on profitability.

The Bank expects to make a profit this year after having been in the red for a
couple of years. Beside the increase in the Bank's capital base, there have
been other developments which would impact on growth and profitability. In
brief, they are (i) the reduction in the cost of financial intermediation from
5.1 per cent in 1996 to 4.6 per cent in 1987; (ii) the improvement in the
recovery of non-performing loans; (iii) the rationalization and improvement
of its overseas operations; and (iv) the beginning of new initiatives like
corporate banking. In corporate banking, UBL recently participated as a co-
manager in the securitization of Daewoo's receivables under a syndicated
arrangement.

UBL has always been an upbeat and growth-oriented institution, but this
does not mean that it has been oblivious to the social responsibilities of
business organizations. It always fulfilled the mandatory credit targets it was
given for loaning to the priority sectors. As part of the government's policy
to improve the technical skills of Pakistani workers, it has set up two
computer literacy centres at Sheikhupura and Muzaffarabad. On the level of
social services per se, the Bank has encouraged sports and built a first-rate
sports complex in Karachi. It is soon going to link up with Internet and
SWIFT to provide prompt, responsive service. It has major plans to train the
staff to provide customers the services they expect from first-rate banks.
 Company Setup:

CHIEF
EXECUTIVE

BOARD OF
DIRECTORS

MANAGING
DIRECTOR

FINANCE PRODUCTION MARKETING SALES

DEPARTMEN DEPARTMENT DEPARTMENT DEPARTMENT
T

MANAGER MANAGER MANAGER MANAGER

FINANCIAL PRODUCTION ASSISTANT ASSISTANT

ADVISOR SUPERVISOR MANAGER MANAGER
 Board of Directors
NAMES DESIGNATIONS
His Highness Shaikh Nahayan Mabarak Al
Chairman
Nahayan
Sir Mohammed Anwar Pervez, OBE, HPK Deputy Chairman

Mr. Atif R. Bokhari President & CEO

Mr. Omar Ziad Jaafar Al Askari Director

Mr. Zameer Mohammed Choudrey Director

Mr. Seerat Asghar Director

Mr. Muhammad Sami Saeed Director

Mr. Amin Uddin Director

Mr. Arshad Ahmad Mir Director

Mr. Aqeel Ahmed Nasir SEVP/Company Secretary & Chief Legal Counsel

Mr. Raymond Kotwal Chief Financial Officer

Location

WITH an integrated network of over 1000 branches in Pakistan as well as

Overseas, UBL gives you direct access to a comprehensive range of better
banking facilities to help you monitor your business locally as well as
internationally.
Improving branch operations and outlook is another focus area within
UBL’s future strategy. In addition to automation, branches will be renovated
to standard that reflects the communities and environment in which they
operate.
Company Profile: “UNITED BANK LIMITED”
Date Established
November 7, 1959

Chairman
His Highness Shaikh Nahayan Mabarak Al Nahayan

Deputy Chairman
Sir Mohammed Anwar Pervez OBE

President & CEO

Mr. Atif R. Bokhari

Branches
1112 Domestic, 17 Overseas Branches

Representative Offices
Iran
Kazakhstan
China

Subsidiary
United Bank AG Zurich, Switzerland
United National Bank Limited, UK (Joint venture with NBP)
UBL Fund Managers Limited
United Executors and Trustees Company Limited

Associated Company
Oman United Exchange Company, Muscat
UBL Insurers Limited

Offshore Banking Unit

Export Processing Zone, EPZ Branch, Karachi, Pakistan

Registered Office
13 Floor, UBL Building,
Jinnah Avenue, Blue Area Islamabad, Pakistan

Head Office
State Life Insurance Corp. Building #1,
I.I. Chundrigar Road, Karachi, Pakistan
P.O. Box No.: 4306
Phone: (92-21) 111-825-111
Gram: "UNITED"
Fax: (92-21) 2413492
 CHAPTER 3

INVESTMENT PLANS BY UNITED

BANK LIMITED
Chapter# 3

Investment Plans by United Bank

Limited

Mahana Munafa Plan

 Free Insurance coverage
 Procedure for investing in the Mahana Munafa Plan
Sarmaya Izafa plan
 Free Insurance coverage
 Procedure for investing in the Sarmaya Izafa Plan
Profit + Growth Plan
 Free Insurance coverage
 Procedure for investing in the Profit+ Growth Plan
Mera Kal - UBL Children savings Plan
 Investment Opportunities that maximizes the
savings
 Procedure for investing in the Mera Kal - UBL
Children savings Plan
UBL Principal Plan Protection Series
 UBL Principal Protection Plan – I
 UBL Principal Protection Plan – II
Salient Features of UPPP – II
 INVESTMENTS PLANS
BY UBL
With rising costs, managing your household expenses (like utility bills,
children’s school fee, etc.) and budgeting for special occasions may seem
like a challenge. In order to help you meet these expenses in time and to
further improve your lifestyle, UBL Fund Managers presents:

MAHANA MUNAFA PLAN:

With the Mahana Munafa Savings Plan you will earn profit on a regular
basis so that you can manage your household without cutting corners. And
while you enjoy a regular source of income, your initial investment will
remain in safe hands.

The Mahana Munafa Plan is an ideal investment for:

 Individuals like Housewives and Retirees, who do not have a regular

source of income

 Individuals and families who want extra money every month to

supplement their regular income

The investment portfolio of the Mahana Munafa Plan comprises of 100%

investment in the United Growth & Income Fund (UGIF) – open end fund
managed by UBL Fund Managers.

Free Insurance Coverage:

Get Accidental Life and Medical Insurance Coverage of up to Rs. 1,000,000
absolutely free of charge when you invest in the Mahana Munafa Plan. The
insurance coverage will protect you and your family against financial
uncertainties that may result due to your accidental demise or illness.

You can avail the free insurance coverage as per the details given below,
starting with a minimum investment of Rs. 500,000.

Insurance Coverage
Investment Amount Loss of Life Accident Accidental Medical
in Rs. Indemnity (Rs.) - Lump Expense Reimbursement
Sum (Rs.) - Annual Limit
500,000-1,000,000 500,000 100,000
1,000,001-2,000,000 750,000 150,000
2,000,001 and above 1,000,000 200,000

PROCEDURE FOR INVESTING IN THE MAHANA

MUNAFA PLAN:
Fill out the application form and submit it at your nearest Investment Center
or UBL Branch along with a copy of your CNIC and Affidavit (incase of
Zakat Exemption). Payment can be made in the form of a cheque, demand
draft, and pay order or through online transfer in favor of ‘CDC Trustee
UBL Funds’ and crossed ‘Account Payee’ only. Cash will not be accepted.

You can enjoy the most precious moments of your life even more when you
are free from financial worries. In order to help you plan for future
obligations ad the to give you the security and peace of mind you need to
take care of your loved ones.
SARMAYA IZAFA PLAN:
With the Sarmaya Izafa Savings Plan the profit realized on your
investment is automatically reinvested into your account along with the
principal investment. Thus growing your savings large enough to take care
of your future responsibilities with ease,

The Sarmaya Izafa Plan is an ideal investment plan for:

Individuals who want to invest and grow their hard earned savings to cover
for future expenses over a period of three to five years

 Individuals who want to earn higher profits on their investment while

having the flexibility to access their money as and when needed

 The investment portfolio of the Sarmaya Izafa Plan comprises of 70%

investment in the United Stock Advantage Fund (USF) and 30% investment
in the United Growth & Income Fund (UGIF) – open end funds managed by
UBL Fund Managers.

Free Insurance Coverage:

Get Accidental Life and Medical Insurance Coverage of up to Rs. 1,000,000
absolutely free of charge when you invest in the Sarmaya Izafa Plan. The
insurance coverage will protect you and your family against financial
uncertainties that may result due to your accidental demise or illness.
You can avail the free insurance coverage as per the details given below,
starting with a minimum investment of Rs. 500,000.

Insurance Coverage
Investment Amount Loss of Life Accident Accidental Medical
in Rs. Indemnity (Rs.) - Lump Expense Reimbursement
Sum (Rs.) - Annual Limit
500,000-1,000,000 500,000 100,000
1,000,001-2,000,000 750,000 150,000
2,000,001 and above 1,000,000 200,000

PROCEDURE FOR INVESTING IN THE SARMAYA

IZAFA PLAN:

Fill out the application form and submit it at your nearest Investment Center
or UBL Branch along with a copy of your CNIC and Affidavit (incase of
Zakat Exemption). Payment can be made in the form of a cheque, demand
draft, and pay order or through online transfer in favor of ‘CDC Trustee
UBL Funds’ and crossed ‘Account Payee’ only. Cash will not be accepted.

Like many people you may be faced with the challenge of maintaining a
balance between regular expenses, like monthly bills, house rent, etc. and
future plans for a new car, house renovation. To help you maintain your
current lifestyle and secure your tomorrow.
PROFIT + GROWTH PLAN:
With the Profit + Growth Savings Plan a portion of your savings will be
invested to provide you with regular profit allowing you to take care of your
daily household expenses while the remaining amount will be invested for
long term capital appreciation that will help meet future goals.

The Profit + Growth Plan is an ideal investment plan for:

 Individuals who want surplus income every month to pay for household
expenses while also growing their savings over a period of three to five
years

 Individuals who are planning for their retirement

The investment portfolio of the Profit + Growth Plan comprises of 70%

investment in the United Growth & Income Fund (UGIF) and 30%
investment in the United Stock Advantage Fund (USF) – open end funds
managed by UBL Fund Managers.

Free Insurance Coverage:

Get Accidental Life and Medical Insurance Coverage of up to Rs. 1,000,000
absolutely free of charge when you invest in the Profit + Growth Plan. The
insurance coverage will protect you and your family against financial
uncertainties that may result due to your accidental demise or illness.
You can avail the free insurance coverage as per the details given below,
starting with a minimum investment of Rs. 500,000.

Insurance Coverage
Investment Amount Loss of Life Accident Accidental Medical
in Rs. Indemnity (Rs.) - Lump Expense Reimbursement
Sum (Rs.) - Annual Limit
500,000-1,000,000 500,000 100,000
1,000,001-2,000,000 750,000 150,000
2,000,001 and above 1,000,000 200,000

PROCEDURE FOR INVESTING IN THE PROFIT +

GROWTH PLAN:

Fill out the application form and submit it at your nearest Investment Center
or UBL Branch along with a copy of your CNIC and Affidavit (incase of
Zakat Exemption). Payment can be made in the form of a cheque, demand
draft, and pay order or through online transfer in favor of ‘CDC Trustee
UBL Funds’ and crossed ‘Account Payee’ only. Cash will not be accepted.

As you become a parent, your responsibility is to ensure that your child has
a safe and bright future. Higher education, foreign degree, marriage and
financial security are some of the important things that you would want to
save for child. However given the increase in costs likely to occur with
every passing year, simple savings may not be enough.
MERA KAL – UBL CHILDREN SAVINGS PLAN:
This is a systematic investment plan designed exclusively for children aged
between 0 to 25 years that allows you to invest regular sums of money in
your account from time to time on a periodic basis, thus growing your
savings and enabling you to meet your child’s future needs without making
any compromises.

Why you should invest in the UBL Funds Mera Kal – Children
Savings Plan:

An investment Opportunity that maximizes the

savings
A plan provides an unmatched investment opportunity, maximizing your
savings over time. The portfolio of the plan comprises of the United Growth
& Income Fund (UGIF) and United Stock Advantage Fund (USF) - open
end funds managed by UBL Fund Managers

PROCEDURE FOR INVESTING IN THE MERA KAL

– UBL CHILDREN SAVINGS PLAN:

Fill out the application form and submit it at your nearest Investment Center
or UBL Branch along with a copy of your CNIC and Affidavit (incase of
Zakat Exemption). Payment can be made in the form of cheque, demand
draft and pay order or through online transfer in favor of ‘CDC Trustee UBL
Funds’ and crossed ‘Account Payee’ only. Cash will not be accepted.
UBL PRINCIPAL PLAN PROTECTION SERIES:
The UBL Principal Protected Plan Series offers investment plans that are
based on the world renowned investment methodology, Constant Proportion
Portfolio Insurance (CPPI) – introduced for the first time in Pakistan.

UBL Principal Protected Plan – I (UPPP-I):

The first plan from the series is UPPP-I was launched in July 2008. Based
on the CPPI Methodology, UPPP-I offers investors exposure to equity
markets while protecting their capital at the end of the three year term of the
plan.

 UBL Principal Protected Plan – II (UPPP- II)

The second plan from the series, UBL Principal Protected Plan – II (UPPP-
II) started on April 27 and has been extended till May 16, 2009.

Salient features of UPPP-II:

The plan provides up to 100% exposure to the stock market with principal
protection at end of the Term through the CPPI Methodology

The plan invests in UBL Fund Managers’ flagship funds United Stock
Advantage Fund (USF) and United Growth & Income Fund (UGIF)
allocating the plan’s portfolio on a daily basis between these funds based on
the performance of the equity markets

In case of significant upside in the stock market, the profit lock-in

mechanism allows potential unrealized profits on the equity portion (USF) to
be realized

Return on investment is tax free as per applicable tax law. Individual

investors can benefit from a tax credit based on their applicable tax rate
Term of the plan: 18 months

Minimum Investment: For Individuals: Rs. 500,000 | For Institutions: Rs.

1,000,000.

CHAPTER 4

SERVICES OF UNITED BANK

LIMITED
Chapter# 4

Services of United Bank Limited

Key developments during 2010
 WATAN CARD
 OMNI
 UBL FIRST MINOR ACCOUNT
 UBL BUSINESS PARTNER PLUS
 UBL SIGNATURE PRIORITY BANKING
 UBL PREMIUM DEBIT CARD
 WIZ ACCA

 NET BANKING
 HAMRAH
 Investing Banking
 UBL Cash line
 UBL Better- life Banc assurance
UBL Auto Loans
Home loans
 Business Loans

Origination System (LOS) has been implemented for Commercial loans and
Consumer products.
LOS implementation for the rest of the Bank will be completed by 2012.
UBL is already starting to see the technological benefits and the improved
service capability that these systems will bring to the Bank and its
customers.

Watan Card:
The Government of Pakistan (GOP) selected UBL to disburse Rs. 20,000
each to over one million families displaced by the flooding. For this effort
UBL issued debit cards, called “Watan cards”, to beneficiaries identified by
NADRA and GOP. Additional planned installments in 2011 will assure
beneficiaries have multiple opportunities to use (and get used to) the cards.
UBL’s ultimate goal is to retain the beneficiaries as Branchless Banking
customers by introducing them to the benefits of using additional services
such as savings, remittances, and bill payments that are accessible via their
Watan card Omni accounts.
The Bill & Melinda Gates Foundation will contribute US$1.5 million
through MEDA (Mennonite Economic Development Association) to support
UBL’s management and administrative costs of procuring and distributing
the cards as well as the cost of ongoing disbursements via Omni Agents. The
funding will also support MEDA in monitoring and documenting the UBL
Watan experience, in order to share learning’s with the wider microfinance
and financial sector communities globally.

UBL Omni:
UBL Omni commenced commercial operations in April 2010 and with it
achieved the honor of being the first commercial bank to launch branchless
banking operations in Pakistan. With Omni, UBL aims to attract the
unbanked population via its retail business agents called Omni Dukaans
which are located in over 350 towns and cities of Pakistan and currently
number more than 6,300.

Pakistan has nearly 65 million unique mobile phone subscribers whilst it has
less than 20 million individuals with bank accounts. This provides the Bank
with the unique platform of being able to include a large segment of the
country’s unbanked population and provide them financial services which
have previously remained inaccessible to them.
In recognition of UBL’s innovative product offering, strong management
credentials and admirable goals of financial inclusion, the Bill and Melinda
Gates Foundation has given UBL a grant of US$6.9 million through Shore
Bank International to promote UBL Omni and ensure its reach to the widest
possible community.

UBL First Minor Account:

The Bank launched ‘UBL First Minor PLS Savings Account’ in 2010, a
savings account designed especially for children, with exciting benefits that
are unmatched in the industry.
By providing an avenue to parents for financial planning for their children, it
should also increase the number of parents in the banking system, as well as
develop a new generation of customers loyal to UBL. This product has
already generated a high degree of interest amongst children via the Bank’s
youth outreach and social media campaigns.

UBL Business Partner Plus:

UBL launched ‘Business Partner Plus’ in 2010, the best current account
offering in Pakistan.
This is a specialized current checking account, with a full menu of services,
aimed at providing the necessary tools for individuals, traders, businessmen
and commercial customers to transact their entire bank related business
activities nationwide through a single platform. This product has been a
major success story in its first year of launch.
Signature Priority Banking:
2010 was the first full year of operations for the UBL Priority Banking
lounges launched in November 2009. These exclusive lounges cater to the
Bank’s existing and potential high‐net worth customers, with relationship
managers trained to offer a range of wealth management products to service
customer needs. UBL has had a successful experience with this offering and
plans to expand this business across Pakistan in the future.

Premium Debit Card:

In 2010, UBL in collaboration with Master Card, announced the launch of
Pakistan’s first Premium Debit Master Card, exclusively designed to cater to
the needs of affluent consumers in Pakistan. Customers who fulfill the
stipulated eligibility criteria are being offered this card, as part of UBL’s
continuing commitment to offering the best products to its customers. In
addition to the features and privileges inherent in the card program, UBL has
also teamed up with various partners to provide preferential benefits to its
cardholders.

Wiz for ACCA:

Wiz is a prepaid debit card which was launched in 2008, and UBL is the
only bank in the country to have this offering. Customers can deposit up to a
limit of Rs 200,000 in their debit card and use it all over the world. The card
can be topped‐up for usage (just like a prepaid mobile phone connection)
from any UBL online branch.
UBL entered into a partnership with the Association of Chartered Certified
Accountants, UK (ACCA), a global body of accounting professionals, which
has thousands of registered students in Pakistan. In this connection, the Bank
has launched a Wiz prepaid card specifically for ACCA students, which is
especially convenient to them in making fee payments online. This is a key
initiative that is expected to increase awareness and usage of the Wiz card.
 UBL NETBANKING
UBL net banking is an Internet Banking portal offering a simple,
convenient and secure method of accessing bank accounts on the Internet.
It's never been so easy to access and manage your finances in a secure, real-
time, online environment; Anywhere, Anytime.

Using UBL net banking, the customers have access to their bank accounts
24 hours a day, 7 days a week and can keep a close eye on their account
balances, print account statements, pay bills, transfer funds, track purchases
and schedule their recurring payments at the touch of a button and much
more.

Features and benefits of net banking:

Net banking is the first service in Pakistan to give you the power to send
money to anyone in Pakistan; even if they do not have a bank account at
UBL. You can either send money to another UBL customer through
Account-To-Account transfer, or get a Tez Raftaar cheque delivered at
payee’s doorstep just within 48 hours anywhere in Pakistan.

Real-Time Account Balance & Summary

Net banking offers easy, 24-hour access to the account information. The
customers can see an overview of the listed accounts in a summarize form
with the available account balance. Using net banking, the customer can also
keep an eye on their cash flows, transactions and check their balances before
paying their bills or scheduling a transfer.

Manage Multiple Accounts

Using net banking, the customers can manage more than one account. All
accounts are linked, which enables them to perform fund transfers and set
auto transfers between these accounts.

HAMRAH
We Are Now Offering Denominations Up To Rs. 10,000 Only
UBL has always been at the forefront in identifying and meeting the
financial needs of its valued customers. UBL was the pioneer in introducing
Rupee Travelers Cheque facility in Pakistan, as early as 1971. In
continuation of the same tradition, UBL in the shape of "Hamrah" Rupee
Travelers Cheque enhances this facility for the convenience of its valued
customers by offering denominations up to Rs. 10,000

UBL "Hamrah" has been designed keeping in mind, both convenience and
security - be it business, property, trade or personal needs. "Hamrah"
Rupee Travelers Cheques are the ideal and safest way of carrying cash when
traveling anywhere in Pakistan.
Hamrah RTC' (Rupees Traveling Cheques)s are now accepted at more
than 2000 places such as hotels, shops, real estate agents, jewelers, car
dealers, etc and of course at all our UBL branches.
UBL has a 24-Hours customer help-line, providing its customers with round
the clock tele-verification of "HAMRAH" traveler’s cheques.

Salient Features of HAMRAH:

Absolutely FREE - No Bank Commission, No
Excise Duty:
Whatever the value of "Hamrah" purchased, no Bank Commission or Excise
Duty will be charged

Denominations: Available in denominations of Rs. 10,000 and Rs. 5,000

Denominations: At any of the large network of designated UBL Branches,
countrywide. Transferable/encashable through a single signature

Available to all: Holding an account with UBL not mandatory for availing
this facility

Easily transferable and encashable: Just dial "Hamrah" Hotline UAN for
assistance 111-111-825 or contact nearest designated UBL Branch

Special facility of refund: Indicate choice of designated UBL Branch for

refund which will be within days only. Most convenient while in transit
anywhere in Pakistan

Valid until encashed: Use them for a week, month or even years depending
on when there’s a need for encashment.

Exclusive security: Secured with specially "Coded" printing and

"RAIN BOW Effect" for added security.
UBL BETTER LIFE-BANC ASSURANCE:

What is Banc Assurance?

Banc assurance is the selling of insurance and banking products through the
same channel, most commonly through bank branches.

Product Offering
UBL Better Life plans are advanced insurance products specifically
designed to benefit the customers, providing the better and secured future to
your family and loved ones.

Initially, we plan to offer the following product types:

UBL Better Life Child Education Plan

Accumulation of target funds for education of your children and ensuring

that goal is achieved even if the parent dies earlier. UBL Better Life Child
Education Plan provides a complete financial package for planning your
children’s education by helping you create an endowment fund for this
purpose in an organized and disciplined manner, over a predetermined
period. To put your son or daughter through college or university, this Plan
is spot on!

Eligibility Criteria 18 – 65 years

Minimum Payment Rs. 15,000 per annum
Partial Funds
Allowed
Withdrawals
Product Features Insurance Protection, Capital Protection

Unit Allocation

The proportion of contribution for investment in units varies by policy year

and is follows

Policy Year Allocation Percentage

25% - 35% depending on policy
1
term
2 80%
3 onwards 100%
11 onwards 105%*

If basic plan contribution is Rs. 20,000 or more.

UBL Better Life Marriage Plan

Endowment funds for your children in an organized and disciplined manner

for use in later life.
UBL Better Life Marriage Plan provides a complete financial package for
planning your son or daughter’s marriage, by allowing you to accumulate an
endowment funds for this purpose in an organized and disciplined manner.
Whether it is meant for your son or daughter’s marriage or to help them to
start off a new life of their own, this plan is spot on!
Eligibility Criteria 18 – 65 years
Minimum Payment Rs. 15,000 per annum
Partial Funds
Allowed
Withdrawals
Product Features Insurance Protection, Capital Protection

Unit Allocation
The proportion of contribution for investment in units varies by policy year
and is follows:

Policy Year Allocation Percentage

25% - 35% depending on
1
policy term
2 80%
3 onwards 100%
11 onwards 105%

If basic plan contribution is Rs 20,000 or more.

UBL Better Life Savings Plan

Flexible open ended savings product with life insurance protection to your
family and loved ones.
UBL Better Life Savings Plan is a high value savings and investment
vehicle. Funds accumulated during the savings term can be utilized for
children’s higher education, marriage, buying a house, generating retirement
income or for any other purpose. The plan is flexible enough to respond to
most individuals’ needs. It is a unit-linked plan which aims to deliver a
substantial sum of money at the end of the savings period. The additional
benefit of course comes in the form of life insurance cover.

Eligibility Criteria 18 – 65 years

Minimum Payment Rs. 15,000 per annum
Product Features Insurance Protection, Capital Protection
Partial Funds Withdrawals Allowed

Optional Benefits
Built in Benefits
Additional Terms Assurance, Family Term
Benefits
Life Care Benefit
Waiver of Premium, Accidental Death
Benefits, Maturity Benefit

Unit Allocation

The proportion of basic plan contribution allocated to investment is as

follows

Policy Year Allocation Percentage

1 35%
2 80%
3 onwards 100%
6 to 10 103%*
11 onwards 105%*

If basic plan contribution is Rs. 20,000 or more.

UBL Better Life Retirement Plan

Accumulating retirement funds for your regular retirement income.

Planning one’s retirement is vital to ensure that a decent standard of living is

maintained without being a burden on anyone. UBL Better Life Retirement
Plan allows financial independence after retirement. Contributions to the
plan are invested in accumulation units to build up substantial capital. At
retirement, this capital generates attractive pension payments after the age of
60, as well as a range of protection benefits tailored to one’s needs.

Eligibility Criteria 18 – 65 years

Minimum Payment
Product Features
Partial Withdrawals
Optional Benefits
Rs. 15,000 per annum
Insurance Protection, Funds Acceleration
Premium, Capital Protection, Loyalty
Bonus
Allowed
Additional Terms Assurance, Family Term
 Benefits, Life Care Benefit
Waiver of Premium, Built in Accidental Death
Built in Benefits Cover,
Guaranteed Loyalty Bonus

Unit Allocation

The proportion of basic plan regular contribution allocated to investment is

as follows:

Policy Year Allocation Percentage

1 35%
2 80%
3 90%
4 to 10 100%
100% plus Loyalty Bonus
11 onwards
allocation

UBL CASH LINE:

UBL Cash line is a flexible loan that provides you cash up to Rs.500, 000
without any security requirements. It empowers you to take control of your
finances.
UBL Cash line is aimed to make your life easier…ZINADGEE ASAAN.
Whether you are a salaried individual or a businessman, UBL Cash line
takes care of your cash requirements.
Cash line offers you:

Flexibility
No fixed monthly installment
Principal repayment at your convenience.
No prepayment penalty
Markup only on utilized amount
Worry free payment of bills, shopping, child’s education, short-term
business needs or just about any thing you can think of!

Empowerment:
For the first time in Pakistan, you can now control your markup. Enjoy
lower markup on higher utilization of funds
Markup calculated on daily outstanding balance
Continuous line of credit.

Convenience:
Instant access to cash through the entire UBL network. You will be given a
cheque book and an ATM/Debit Visa Card which you can use at 900,000
ATMs and 22 million outlets worldwide.

Unsecured /clean lending, no collateral required

All UBL Cash line customers are automatically registered on UBL net
banking and can avail numerous net banking features such as

Bill Payment
Funds transfer
Account update
Statement of accounts
How can you get Cash line?
Cash line is offered in the following cities:

BAHAWALPUR OKARA
FAISALABAD PESHAWAR
GUJRANWALA QUETTA
GUJRAT RAHIM YAR KHAN
HYDERABAD RAWALPINDI
ISLAMABAD SAHIWAL
JHELUM SARGODHA
KARACHI SIALKOT
LAHORE WAZIRABAD
MULTAN WAH CANTT
LARKANA MIRPURKHAS
SUKKUR NAWABSHAH
KHARIAN
INVESTMENT BANKING
The Largest Investment Bank in Pakistan

IBG provides innovative and unique solutions to its clients enabling them to
meet the challenges of an ever- changing market.
Dedicated specialist team of 14 investment bankers. Supported by over 50
relationship managers in six different locations in Pakistan alone.
Well established execution experience.
Rich international and domestic investment banking product knowledge
Strong distribution capability.

Three specialist business areas:

Project & Structured Finance
Syndications & Debt Capital Market
Equity & Advisory

Awards Given To UBL as A Large Investment

Bank
Awarded the “Largest Investment Bank” award by The CFA Association
of Pakistan for three consecutive years (2003-2005).
 Awarded the "Corporate Finance Transaction of the Year" by the CFA
Association of Pakistan for FY 2005
Current mandates add up to over PKR59 billion (US$967million). A
healthy mixture of Debt, Equity & Advisory transactions.] Structured and
executed debt and equity transactions totaling over PKR 45 billion (US$744
million) in 2006, PKR60 billion (US$1billion) in 2005, and PKR52 billion
(US$866 million) in 2004.
DEBT AND CAPITAL MARKETS:

• Loan Syndications
• Term Finance Certificates (TFC
• Listed TFC
• Privately Placed TFC
• Securitization
• Commercial Paper (CP)

Loan syndications:

• Raising term financing from financial institutions

• Can be used to raise large financing amount
• Results in the use of bank lines by the corporation
• Advantage of bilateral-type operation as primary interface is with the
Agent Bank only
• IBG acts as an Advisor, Arranger and/or Trustee of the loan facility

Term Finance Certificate (TFC)

• Redeemable capital issued under section 120 of the Companies

Ordinance, 1984
• Capital market alternative to traditional bank debt
• Replicates the cash flows of a coupon-bearing bond
• First TFC in Pakistan issued by Packages Limited in 1995.
• Two types of TFCs are:
• Listed TFCs
• Privately-Placed TFCs
Listed TFC
Listed TFCs are made available to the general public in addition to
institutional investors through listing on the stock exchange

Facilitate trading in the secondary market

Offered through both Private Placement (Pre-IPO) and Initial Public Offer
(IPO)
Listing creates liquidity through bid and offer quotes in the secondary
market
Increasingly growing with 14 companies offering TFCs worth PKR 16.8
billion at the Karachi Stock Exchange
alone in 2005. This trend also continued in the year 2006 and UBL IBG had
significant market share of listed
TFC issues in 2006
Privately Placed TFC:

• Privately-Placed TFCs are not offered to the public

• Offered to a single principal investor or to a group of institutional
Investors, allowed under Section 120 of the Companies Ordinance,
1984
• Arranging a Privately-Placed TFC issue takes considerably less time.
Can be achieved in a matter of 4-8 weeks
• Approvals are not required from regulatory authorities (stock
exchanges, SECP) and the credit-rating
of the entity and instrument need not be obtained
 Securitization:
• Securitization designed to improve the risk profile of the facility for
the Issue
• IBG acts as Structuring Agent and Arranger
• Asset Backed Securitization (ABS)
• Bonds or notes backed by financial assets
• Pools of financial assets are sold to SPV
• SPV converts these pools to marketable securities in the form of Asset
Backed Securities

Commercial Paper:
• An unsecured promissory note with a maturity period ranging from
thirty days to one year
• A money market instrument which can be issued by rated companies
to diversify their short term sources
of financing
• Transferable by endorsement and delivery
• Commercial Paper is issued at a discount calculated on the basis of the
mark-up which is determined by the Issuer
The Issuer to maintain a minimum current ratio of 1:1 and to maintain
a minimum Debt/Equity ratio of 60:40
UBL AUTO LOANS:

UBLDRIVE:
UBL Drive is a unique auto financing product which offers you features,
options and flexibility unmatched by any other bank, because at UBL, You
come first.

New Car Financing:

UBL Drive allows you to drive away in your own car by

making a down payment of just 15% and to top that with low monthly
installments.

Pricing Plan

Tenure 1 to 2 years 3 to 4 years 5 to 6 years 7

years
Rate 20.00% 20.50% 21.00% 21.50%
Used Car Financing:

With UBL Drive you can buy your favorite used car (up to 5 years old) at
the most affordable rates.

Pricing Plan
Tenure 1 to 2 years 3 to 4 years 5 years
Rate 21.00% 21.50% 22.00%

The rate of installment is fixed it cannot be change year by year which can
be show by the figure

Car Replacement Plan:

Drive’s Car Replacement Plan is the slogan name for a premier auto
financing product. Customers who intend to avail loan facility from UBL
Drive under this variant can readily have their existing cars replaced after a
year of financing.
Insurance Options:

UBL Drive offers you the following insurance options:

1. Comprehensive insurance
2. Insurance financing for the first year
3. Discounted rates with Tracker car security device installed at
customers' cost

Processing Charge
A processing charge of Rs. 5,000 will apply.

HOME LOANS

Buying a Home:

Why rent when you can buy? Buying a home of your choice
has never been so easy. With a maximum financing limit of 70% you can
easily buy a house or apartment that best fits your requirements. So go ahead
and start the search for your dream home because with easy and affordable
installments you need not think of renting a house when you’ve got UBL
Address.

Building a Home:
Have you ever settled for anything less than perfect? There’s nothing like
building your perfect home, your way. With every detail in place like the
elegant French windows or the perfectly manicured lush green lawn, just the
way you’ve always imagined. By chalking out well planned fund branches at
each phase of the building process, UBL Address brings you your dream
house one step closer.

Land plus Construction:

What do you do with an empty piece of land? Construct your dream house
with all the aesthetic details you’ve ever wished for. UBL Address helps
you through every stage of construction by providing you with well planned
out fund branches so that you can better manage your construction.

BUSINESS FINANCING
LOANS:
UBL Business line is a complete solution to all your Business Financing
needs.
With UBL Business Financing facility, you can now take your business to
greater and newer heights, and achieve the level of success that you truly
deserve.
UBL Business line is a running Finance facility that not only provides funds
for growth but also enables you to capitalize on profitable opportunities.
With UBL Business line, now you will surely say: “Ab Hui … Kamiyaabi
Meri Manzill”.

What is Business line?

“It is a ‘Credit Line/ Overdraft (OD) Facility’ against Residential Property.
It is an evergreen credit line that the customer can use for his/her business
expansion”

Features:
Utilize up to Rs.10 million:
Now UBL Business line credit line is here to solve all your cash flow
problems. You can utilize up to Rs.10 million with the help of which you
can now focus on your business expansion and growth.

Mark up on utilized amount only:

With UBL Business line, now you no more need to pay for the entire credit
line that you own. Business line gives you the facility to pay mark up only
on the amount that you utilize.

Faster Processing:
After completion of your documentation requirements, UBL Business line
promises you a very smooth and fast processing, hence saving you time and
frustration.

Wide Accessibility:
UBL Business line’s availability in major cities like Karachi, Lahore,
Faisalabad, Islamabad & Rawalpindi, is complimented by UBL s
countrywide branch network enabling our customer to access his account,
and deposit or withdraw cash, no matter where he stands within the country.

Eligibility Criterion: If you fall in the following criteria, then UBL

Business line is just the right choice for you:
Minimum monthly income: Rs. 50,000
Age: 25 – 55
Resident: Pakistani.
Self Employed Professional / Self Employed Business

Chapter# 5
Financial Analysis of United Bank
Limited

United bank Limited

Balance Sheet
 Profit & Loss Account
 Ratios analysis
 BALANCE SHEET
AS AT DECEMBER 31, 2010
Rupees in (000)

2010 2009 2008

ASSETS

Cash and bank balance 67461668 61470047 50,069,965

Balance with other banks 18192142 5407470 7,497,174
Lending to financial 12384778 23162130 22,805,341
Institutions
Investments 224578556 136145524 116,328,28
8
Advances 333732172 354091713 371,139,67
5
Other assets 22424072 21925669 17,154,985
Operating fixed assets 1298403 608876 18,021,445
Taxation recoverable --------- --------- --------------
Deferred tax asset-net 18713188 16905004 2,055,609
Total assets 68415065 60936723 43,862,759

TOTAL LIAB. & OWNER .

EQUITY

Bills payable 5045815 5147259 5,194,449

Borrowing From Fin. 45104849 35144823 44,195,886
Institutions
Deposits & other A/c's 50645767 492036103 483,560,062
Sub – ordinate loans 11985748 11989800 11,993,84
8

Other liabilities 17587735 14461725 16,265,478

Deferred liabilities ----- ------ ---------
Share capital 12241798 11128907 10,117,188
Reserves 21688637 18959537 15,501,513
Inappropriate profit 26250489 22187802 16,604,076
Surplus on revaluation of 8234141 8660477 1,639,982
asset

Total liabilities and 68415065 60936723 43,862,759

owner equity
 PROFIT & LOSS ACCOUNT
AS AT DECEMBER 31, 2010

Rupees in (000)

2010 2009 2008

Net markup/interest 34108508 32943238 28,135,659
income after provision
Non markup/interest 10120632 11419571 10,401,394
income

Total Income 44229140 44362809 38,537,053

Non markup/interest
expenses
Administrative expenses 17765056 1660856 15,519,634
1
Other provision/write offs 63233 642274 450,390
240391 64552 258,321
Other charges
Total Non markup/ interest 18482222 17712934 16,565,344
expenses
- - -
Extraordinary items
Profit before tax 17742218 14034501 13,874,424
Tax 6582288 4841814 5,541,304

Profit-after Tax/net 11159930 9192687 8,333,120

income
 FINANCIAL ANALYSIS

2008 2009 2010

Current Ratio 0.91 1.15 2.9
Asset Turnover 0.06 0.04 0.64
Debt to Asset 0.94 0.93 0.95
Debt to Equity 14.4 13.4 1
Coverage Ratio 1.15 3.34 3
Gross Profit
Margin 52.5 79 40 %
Net Profit Margin 12.69 30 25 %
Return On
Investment 0.76 1.24 4.3 %
Return On Equity 16.78 18 16.3 %
Advances to
Deposit 46.74 45 49 %
Investment to
Deposit 41.63 28 29 %
Cash Ratio 9.23 28 29.8 %

FINANCIAL RATIO ANALYSIS

The user of financial statements finds it helpful to calculate ratios when they
interpret company’s financial statements. A financial ratio is simply one
quantity divided by another.
Ratios focus on special relationship between two items of balance sheet,
income statement or one from each. Ratios make it easier to understand a
specific relationship between various items of financial statements then
looking simply at the raw numbers themselves. The number of financial
ratios that might be created is virtually limitless, but there are certain
basic ratios that are frequently used, these ratios can be placed into six
different classes.
Liquidity Ratio
 Asset Turnover Ratio
 Leverage Ratios
 Coverage Ratios
 Profitability Ratios

 Market Value Ratios

The calculation and interpretation of these ratios of financial statements of

UBL are as follows.

CURRENT RATIO:
UBL’s current ratio is increasing over the time. Higher the current ratio
higher the ability to meet the short-term obligations as they come due. The
UBL’s current ratio is increasing year by year. This in turn decreases the risk
of insolvency. The change is occurring due to increase in short term
investment and decrease in short term borrowings.

ASSETS TURN OVER:

This shows revenue generated per rupee investment in total assets. UBL’s
assets turnover ratio has shown a little decrease. This is because of increase
in total assets with proportionate increase in revenue. Banks have relatively
low ATR capital, as they are selective in advancing loans and generating
smaller sales.

DEBT TO ASSET RATIO:

The analysis of total debt to assets ratio, there has been decrease of one
percent as compared to 2009. In 2007 every rupee one of assets was being
financed by rupees 0.094 or debt and in 2009 it is 0.93 while in 2010 it is
reduced to 0.95 worth of debt per rupee of asset. Although the decrease is
not large enough but it is a good sign for bank’s creditors. The decrease may
be attributed to the substantial decrease in borrowings from financial
institutions but the affect was weakened by an increase in bills payable and
other liabilities.

DEBT TO EQUITY:
This ratio measures how the company is leveraging its debt against the
capital employed by its shareholders. Analysis of debt to equity ratio
indicates that the current position for the debt to equity is that for every one
rupee in equity provided by the shareholders the bank has Rs. 14.4 as a debt.
This shows that the bank is heavily relying on debt financing. The reason
For huge difference stated in the table is because of losses occurred in 2008,
2009 and 2010.

COVERAGE RATIO:
This ratio shows the number of times a company can cover or meet its
financial charges or obligations. One of the most commonly used ratios is
the interest coverage ratio that measures the number of times the income is
available to pay interest charges. The UBL interest coverage ratio has shown
significant improvement in these three years. The ratio is increased from
0.15 to 3.34.

GROSS PROFIT MARGIN:

Gross profit margin is the difference between the revenue and cost of goods
sold. Gross profit is critical because it represents the amount of money
remaining to pay operating expanses financing cost and taxes. UBL’s gross
profit margin per rupee has shown rising trend in last three years. There is an
increase of 27% in 2009 as compared to 2008. This shows efficiency of the
bank to control the cost of sales.

NET PROFIT MARGIN:

This ratio shows the profit that is available from each rupee of the sale. After
all expanses have been paid. Net profit margin is also showing an increasing
trend. UBL has improved net profit margin in the current years. The net
profit margin has reached to 30% as compared to 2008 in which it was only
12.69%. While in 2007 it was in negative figure. It shows a good impact on
the UBL’s Balance Sheet.

RETURN ON INVESTMENT:
This ratio measures the profitability per rupee of investment in assets.
UBL’s return on investment has shown an improvement more than 100%. In
2009 the ratio is 1.24% while in 2008 it was 0.76% and in 2010 it is 4.3.
Although the assets have increased but the operational recovery of the bank
is main cause of increasing this ratio.

RETURN ON EQUITY:
This ratio shows the profit as a proportion of the book value of the common
shareholders. The return on equity is also shown deal of positive change. In
2010 the ratio is 16.3% while in 2009 it was only 18% and in 2008 it was in
16.78.

ADVANCES TO DEPOSIT RATIO:

This ratio shows the companies advances employed per unit of deposit. This
ratio of UBL over the recent three years shows a increasing trend. In 2008
46.74 it was 45% while in 2009 it was 46% and in 2009 it is 45%.

INVESTS TO DEPOSIT:
This ratio shows the company’s investment employed per unit of deposit.
This ratio decreased in 2009 as compared to 2008 but in 2010 it again
increased. It is because of industrial development factors in the country by
which lending has been increased and investment is slightly decreased.
 CHAPTER 6
Analysis Of United Bank limited
 Strategic Analysis
 Financial Analysis
 Credit Ratings
 Awards given to UBL
 STRATEGIC ANALYSIS
BCG MATRIX OF UBL

RELATIVE MARKET SHARE

High Medium ?Low

High

UBL Omni
UBL Cash line UBL Better life banc assurance
Medium
Investment Banking
Net Banking

Low Cash Cow Dog

Hamrah UBL Money or

(Personal loans)
Comparison through STRATEGIC ANALYSIS:
When we took analysis of UBL so we come to that point UBL is
commercial bank it also has there own importance and capture
huge market share as well but we talk about BCG matrix then we
come to that point UBL has wide range of services which is on
peak position which can be show on BCG Matrix so according to
our judgment here UBL is stronger position in market then other
commercial banks.
According to Mr. Aftab Malik (Branch Manager of UBL)he said
that 4 services is in star position because they capture huge market
share and increases industry sales growth other Hamrah generate
cash but slightly omit from market where as UBL better life banc
assurance and UBL Omni is newly introduce which give good
response or in future more chances to generate huge profit if we
talk about UBL Money which is personal loans it is fail because
huge amount of capital is given to customers so due to this more
chances of bad debts in this current situation where people are in
trouble.
Comparison through FINANCIAL ANALYSIS:

When we do analysis of UBL through financial ratio so UBL is

stronger than Pak Oman Investment Company if we talk about
current ratio it shows that UBL meet their liabilities and try to pay
off it. The total assets to total liabilities is 100% which means the
assets is fully utilize and help to pay off the liabilities which shows
very good condition of UBL there is huge decline in debt to equity
ratio which is unfavorable for the company where as Debt to
assets, Gross profit margin is slightly fluctuated and If we focused
on all these three year and compare it with each other so we come
to that point as compared to 2008 and 2010 the 2009 was more
profitable and beneficial for the bank.

CREDIT RATING:

The credit rating company JCR‐VIS re‐affirmed the bank’s long‐

term entity rating at AA+ and the ratings of its four subordinated
debt instruments at AA. The short term ratings remain at A‐1+
which is the highest rating denoting the greatest certainty of timely
payments by a financial institution. All ratings for UBL have been
assigned a Stable outlook.
Capital Intelligence (CI), the international credit rating agency, has
re‐affirmed UBL’s Foreign Currency long‐term rating at B‐, while
it’s Foreign Currency short‐term rating has been upgraded from C
to B in line with CI’s sovereign ratings action on Pakistan. In
addition, the Bank’s Financial Strength rating has been re‐affirmed
at BB+, with the Outlook upgraded from Negative to Stable based
on the Bank’s strong performance in 2009 and the first half of
2010.
UNITED BANK LIMITED RECEIVE AWARD AS LARGEST
INVESTMENT
BANK
“Largest Investment Bank” award by The CFA Association of Pakistan for
three consecutive years (2003-2005) to UNITED BANK LIMITED.
Awarded the "Corporate Finance Transaction of the Year" by the CFA
Association of Pakistan for FY 2005.

CONCLUSION

The UBL is well managed with organized structure and having

efficient employees. Due to its growth in online branch system, it
has bright future in Financial Organizations and contributing
towards the development of the country both economically and
socially.
 SUGGESTIONS &
RECOMMENDATIONS
At the end of every report, it needs suggestions and recommendations.
According to our judgment the following are the suggestions and
recommendations.

• As UBL is expending with it network 1058 branches, it should be

beneficial for the bank to computerized all the branches and earn more
than before.

• It should be necessary for the UBL that for the old employees training
session for well grooming, because even they don’t know that how to
deal with new technology.
 • UBL should be appointing at least one HR officer at hub level for
dealing HR related work.

• As UBL have well in IT sections, we think they can develop their own
ATM network as M.net and 1 link.

• The ATM machine is some times in small cities remain disturb that’s
why customer become dissatisfied, if UBL have its own network
related ATM than this problem should solve.

List of Acronyms

AD Authorized Dealer.
ATM Automated Teller Machine
ATR Asset Turn Over
AVP Assistant Vice President
AOF Account Opening Form
BOG Board of Governor
BOD Board of Director
CA Credit approval
CP Credit Proposal
DAC Disbursement Authorization Certificate
DD Demand Draft
DP Note Demand Promissory Note
EBIT Earnings before Interest & Tax
ESVP Executive Senior Vice President
EVP Executive Vice President
FDD Foreign Demand Draft
FMT Foreign Mail Transfer
FTDR Foreign term Deposited Receipt
FTT Foreign Telegraph Transfer
GM General Manager
GOP Government of Pakistan
GPM Gross Profit Margin
HBL Habib Bank LTD
IMS Institute of Management Sciences
LC letter Of Credit
MCB Muslim Commercial Bank
MT Mail Transfer
NPM Net profit Margin
OG1 Officer Grade 1
PLS Profit & Loss Saving Account
PO Pay Order
RCAD Regional Credit Administration Department
RF Running Finance
RM Relationship Manager
ROI Return on Investment
RTC Rupee Traveler Cheque
STDR Special term Deposited Receipt
SVP Senior Vice President
SWOT Strength Weakness Opportunities Threats
TIE Time Interest Earned
TT Telegraphic Transfer
UBL United Bank LTD