Internship Report of Js Bank

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)
PREFACE
Internship is an integral part of M.Com program. For the sake of internship the most initial thing is to
have a practical experience. This effort may get as a student to get a practical experience if right
organization is selected. During this internship, a student comes to particle knowledge. He learns
what the has so far studied. As an M.Com student I have also done my internship in JS Bank Ltd.
Rahim Yar Khan. Here I come to know a different and very interesting experience of learning and
working with people. First of all I will tell you about Bank then I will tell operations of different
departments.
This internship report is specially meant for the students of M.Com. It is concerned to a brief study of
operation, functions, tasks and services of the JS Bank Ltd. Banking play very important role in the
commerce and economic development of any country. Now-a-days banks are using different modern
technologies which influence the managerial activities that are why I decided to do my internship
training in the bank.
In preparation of this report I have tried my best to provide all possible information about the
operation, functions, task and the corporate information of the JS Bank Ltd. in brief and
comprehensive way. This internship ends with some recommendations after identification of
problems that I observed during the course of my internship training.
Prepared By: Ahmad Noor Ud Din
Dedication
My report is dedicated to my parents, teachers and my cute friends who are

always with me in Every Hardships of life and has waited for me to be here at
Final stage.
May! Allah Give them Long Life (AMEEN)
Acknowledgement
Most grateful to Almighty Allah who enabled me to utilized my knowledge and skills for the
preparation and completion of this internship report. I want to express my most humble gratitude
to my supervisor and all other teachers and class fellows who furnished me with the opportunity
to complete report I m also thankful to the manager colleagues and friends who provided with
the moral support during the completion of this report.
History of banking
The history of banking begins with the first prototype banks of merchants of the ancient world,
which made grain loans to farmers and traders who carried goods between cities. This began
around 2000 BC in Assyria and Babylonia. Later, in ancient Greece and during the Roman
Empire, lenders based in temples made loans and added two important innovations: they
accepted deposits and changed money. Archaeology from this period in ancient China and India
also shows evidence of money lending activity.
Banking, in the modern sense of the word, can be traced to medieval and early Renaissance Italy,
to the rich cities in the north such as Florence, Venice and Genoa. The Bardi and Peruzzi
families dominated banking in 14th century Florence, establishing branches in many other parts
of Europe. Perhaps the most famous Italian bank was the Medici bank, established by Giovanni
Medici in 1397. The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in
Siena, Italy, which has been operating continuously since 1472.
The development of banking spread from northern Italy throughout the Holy Roman Empire, and
in the 15th and 16th century to northern Europe. This was followed by a number of important
innovations that took place in Amsterdam during the Dutch Republic in the 17th century and in
London in the 18th century. During the 20th century, developments in telecommunications and
computing caused major changes to banks' operations and let banks dramatically increase in size
and geographic spread. The financial crisis of 20072008 caused many bank failures, including
some of the world's largest banks, and provoked much debate about bank regulation.
HISTORY AND DEVELOPMENT OF BANKING IN PAKISTAN

History of Banking in Pakistan starts from the partition of Indo-Pakistan sub continent in
August,1947. At that time, the areas consisting Pakistan had 631 offices of 45 scheduled banks
out of which 487 were located in West Pakistan and 114 in East Pakistan which Was also served
by 500 office of small and non-scheduled banks. There were 19 branches of foreign banks in
Pakistan but they had a very limited role to play.
Just after the partition, the Indian bankers started immigrating and shifting the head offices of
their banks and capital to India. It caused a great set back to the banking field in Pakistan, and
resulted in decline in the number of offices in schedule bank from 631 to 195 by 30th June, 1948.
The West Pakistan the number fell from 487 to 81 in East Pakistan from 144 to 69 by 30th June,
1951. Among these Habib Bank Ltd., with 25 offices and Australia Bank Ltd. with 19 offices
were
institutions
run
by
muslims
who
shifted
their
head
offices
to
Pakistan.
The technical and administrative difficulties of establishing a central bank just after
independence compelled Pakistan to enter into an agreement with the Reserve Bank of India by
which the bank was to perform the function of a central bank in this area also upto 30th
September, 1948. The Reserve Bank of India started following wrong policies against the
interest of Pakistan. The situation became so grave that after the consultation of two government
the Reserve Bank of India was asked to finish the agreement from 30th June instead of from 30th
September,1948. So the Government of Pakistan decided to establish the State Bank of Pakistan
as its central bank from 1st July, 1948. In the same year first Pakistani notes in the denomination
of Rs.5, 10, and 100 were issued and Indian currency was withdrawn from circulation. After it
the government was advised to a bank which should serve as a agent of State Bank of Pakistan.,
On this suggestion National Bank of Pakistan which was established in 1949 to finance jute trade
in East Pakistan to take over the agency functions from the Imperial Bank of India. Further more
banking companies control act 1949 was promulgated which empowered the State Bank of
Pakistan to control the operation of other banks. To boost the economic development the State
Bank of Pakistan encourage the commercial banks and gave them schemes to advance in the
agricultural and industrial fields. In addition to this specialize financial. institutions were set up
to
meet
the
acute
shortage
of
funds
in
these
fields.
The State Bank of Pakistan's policy encouraged expansion in established banks, establishment of
new banks, and weeding out of unsound banks just to faster the growth of banking system in the
country. This policy not only established the banking system by 1965 but increased its functional
efficiency, scope of operations and soundness to a great extent and the following banking
structure:
1. STATE BANK OF PAKISTAN (CENTRAL BANK)

2. COMMERCIAL BANKS.
3. SAVING BANKS
4. CO-OPERAT1VE BANKS
5. EXCHANGE LANES
6. SPECIALIZED FINANCIAL INSTITUTIONS
There are two types of the COMMERCIAL BANKS
1. Scheduled
2. Non-scheduled banks
According to the State Bank of Pakistan Act,1956 a bank having a paid up capital and a reserve
of rupees five lacs and fulfilling certain other requirements can be scheduled with the State Bank
of Pakistan. With the opening of the State Bank of Pakistan and the keen interest which it took in
the establishment of the sound banking system in Pakistan despite the separation of the East
Pakistan, commercial banking made a tremendous progress which can be judged from the
following figures. Offices of the following 14 banks (scheduled) increased from 195 to 1948 to
3600 with 71 branches outside Pakistan in 1972, deposits from 88 Crores in 1948 to 1900 crores
in
1972
and
advances
from
20
crores
1. National Bank of Pakistan

2. Habib Bank Ltd.
3. Habib Bank (Overseas) Ltd.
4. United Bank Ltd.
5. Muslim Commercial Bank Ltd.
6. Commerce Bank Ltd.
7. Australasia Bank Ltd.
8. Standard Bank Ltd.
9. Bank of Bahawalpur Ltd.
10. Premier Bank Ltd.
11. Pak Bank Ltd.
12. Sarhad Bank Ltd.
13. Lahore Commercial Bank Ltd.
14. Punjab Provincial Co-operative Bank Ltd.
in
1948
to
1250
crores
in
1972.
On January 1, 1974 the Government of Pakistan nationalize all the Pakistani scheduled banks
including State Bank of Pakistan, industrial Bank of Pakistan, Agricultural Development Bank of
Pakistan through the bunk- nationalization act, 1974 to achieve the desired objectives. The
weaker commercial banks were merged with stronger ones and in all five major banking
companies were formed.
1. NATIONAL BANK OF PAKISTAN
2. HABIB BANK LIMITED
3. UNITED BANK LIMITED
4. MUSLIM COMMERCIAL BANK LIMITED
5. ALLIED BANK OF PAKISTAN
The Federal Government also set up a Pakistan Banking Council on March 21, 1974 to look after
the organizational and operational matters including evaluation and progress of the nationalized
commercial banks. The State Bank was to provide the overall policy guidelines to commercial
banks.
History
JS Bank is a majority-owned subsidiary of Jahangir Siddiqui & Co. Ltd. It is a commercial bank
and also has a Primary Dealer license for government securities from the State Bank of Pakistan.
JS Bank Limited has been formed after the merger and amalgamation of Jahangir Siddiqui
Investment Bank Limited and commercial banking operations of American Express Bank
Ltd Pakistan. JS Bank Limited commenced operations in Pakistan as a fully scheduled bank on
December 30, 2006. In 1999, Jahangir Siddiqui Investment Bank Limited (JSIBL) was formed
when Jahangir Siddiqui & Co. Ltd. acquired Citicorp Investment Bank (Pakistan) Limited.
JSIBL principally mobilizes funds through issuance of Certificates of Investment to individual
investors, corporate clients, and financial institutions. Short-term financing was provided to
corporate clients through these funds. The investment bank was also an active investor in equity,
bond markets, and money markets through outright repo and reverse repo transactions. In 2006
the number of branches was 4, which increased to 9 in 2007. In 2008 the number increased to 39
and to 101 in 2009. In 2010, the number of branches were 129. Currently, JS Bank has 238
branches in 122 cities.
Company Information
Board of Directors
Mr. Jahangir Siddiqui

Mr. Mazhar-ul-Haq Siddiqui
Mr. Maqbool A. Soomro
Mr. Ashraf Nawabi
Mr. Rafique R. Bhimjee
Syed Amjad Ali
Mr. Basir Shamsie
Chairman
President &
Chief Executive Officer
Mr. Naveed Qazi
Audit Committee
Mr. Maqbool A. Soomro
Mr. Rafique R. Bhimjee
Chairman
Member
Member
Human Resource
Committee
Mr. Naveed Qazi
Syed Muhammad Shoaib Omair
Chairman
Member
Member/Secretary

Mr. Naveed Qazi
Mr. Ashraf Nawabi
Syed Amjad Ali
Mr. Akbar Hasan Khan
Chairman
Member
Member
Member
Secretary
Risk Management
Committee
Company Secretary
Mr. Muhammad Yousuf Amanullah
Auditors
Ford Rhodes Sidat Hyder & Co.
Chartered Accountants
Legal Advisors
Bawaney & Partners
Liaquat Merchant Associates
Share Registrar
Technology Trade (Pvt.) Limited
241-C, Block-2, P.E.C.H.S.,Karachi.
Registered Office
JS Bank Limited
Shaheen Commercial Complex
Dr. Ziauddin Ahmed Road
P.O. Box 4847
Karachi-74200, Pakistan.
ORGANIZATIONAL STRUCTURE OF JS BANK LIMITED

PRESIDENT AND CEO
7 MEMBERS OF BOARD OF DIRECTORS
SENIOR VICE PRESIDENTS
VICE PRESIDENTS
ASSISTANT VICE PRESIDENTS
GRADE I OFFICERS
GRADE II OFFICERS
GRADE III OFFICERS
CLERICAL STAFF
NON-CLERICAL STAFF
FUNCTIONS OF JS BANK LIMITED

To fulfill the basic objective JS BANK perform following important functions.
Corporate Banking
Corporate Banking division at JS Bank offers financial solutions to meet the needs of every type
of business. We provide a wide range of products & services including but not limited to the
following:
Import Services
Documentary Letters of Credit (Local & Foreign)
Import Documentary Collections
Open Account Transactions
Standby Letters of Credit
Shipping Guarantees/ Airway bills endorsements
Dollar based financing under FE-25
Financing against Imported Merchandise
Financing against Trust receipt
Export Services
Pre-shipment Finance
Post-Shipment Finance
SBP Export Refinance Facility
Bill Discounting/ Negotiation (Local & Foreign)
Foreign Currency financing under FE-25
Export Documentary Collections
Guarantees
Tender/Bid Bonds
Performance Bonds
Advance Payment Guarantees
Other Guarantees
Short Term Finance

Running Finance
Short Term Loans
Discounting of Receivables
Commodity Financing
Financing against Shares
Term Finance
Medium Term Financing
Lease Finance
Cash Management Services

Payables Management
Receivables Management
For effective handling of branches, it has been categorized into three segments with different
people handling each category. These categories are:
Investment Banking
JS Banks Investment Banking Group (IBG) has been the pioneer of numerous landmark
transactions brought to the domestic capital markets. The groups legacy dates back to the 90s
through a closely held partnership with the then eminent Bear Stearns.
With a precedence of both volume and innovation in transactions, for some of the largest
corporations in the country, IBG continues to offer market-leading investment banking and
ancillary services as an integral part of the Bank. With a market share of 33%-35% in terms of
new issuance, JS Banks IBG holds an impeccable track record of completing over 35 capital
market transactions since 2007.
Institutional Banking
Catering to diverse needs and requirements of retail, commercial and corporate clients global
import and export needs in a timely, efficient, risk averse manner. While having a continuously
growing distribution network covering over 250 global destinations via SWIFT at present.
Fund Based Relationships
Conventional Nostro and Vostro Accounts
Discounting of Letters of Credit
Risk Participation
Buying risks originated by other banks
Trade Relationships
Letters of Credit Advising
Letters of Credit Confirmation
Guarantees
JS Bank guarantees are acceptable with Government of Pakistan, its agencies and major financial
institutions.
JS Treasury
In an exceedingly volatile and dynamic economic environment, JS Banks Treasury has evolved
as an active player in the Financial Market. The Banks client-centric treasury endeavors to
partner its customers in ensuring they use the financial markets to optimize their risk profile and
enhance value to their stakeholders. The Treasury seeks to do this by becoming the risk solutions
provider of choice, offering quality treasury products, and being the leader in product innovation.
JS Bank Ltd is a One Stop Solution to all your financial needs, whether it pertains to Foreign
Exchange, Fixed Income (GoP, Corporate Debt), Mutual Funds and Money Market (Deposit or
Loan) transactions.
OPENING OF ACCOUNT
To open an account the customer have to meet the general banking manager with an introducer
and get an application from used for account opening. Single account opening application form
is available for all types of types of account. Along with the form a card for specimen signature
is also supplied to customer. Manager has every right not to accept this contract if he is not
satisfied by the details provided by the customer. In case the contract is acceptable to both, then
it is the tie to open the account formally.
PROCEDURE TO OPEN AN ACCOUNT

According to my practice in JS Bank, when a customer wants to open an account, the bank
officer gives him an application form. All information, which is necessary to be known by the
bank, are requirements of the application form. Form also requires the essential documents to be
attached by the customer.
Basically following information is required to open an account are.
Title of Account
Full Name of Applicant
Occupation
Address
Telephone No.
Currency of account
Nature of Business
Introducers Name, Address & Signatures
Special instruction regarding the account
Initial Amount of the Deposit
Signature of the applicant
The procedure begins with the punching of account opening form to the customer file i.e.
customers master file. The manager records he necessary details into this register and allots an
a/c number from this a/c opening register. This register is maintained for each type of account
and the A/c nos allotted serially. After opening a saving and current account every applicants
data is entered in to the computer to maintain a safe record and application form is properly filled
so that it can be available when necessary. Checking officer is responsible to Tele the manual
application form with the computerized a/c opening file. For fixed deposit only that application
form is needed this is prepared manually, because most of the procedure of fixed deposit is done
manually. The signature specimen card contains three signatures of an applicant, applicant a/c
no a/c type, branch code, title of a/c it will be attached with an application form. Banker uses
this card at the time when he receives the cherub; he compare customers signature with the
signature on the cherub form avoiding fraud.
Types of Accounts
Rupee Plus Account
A high performing product, JS Banks Rupee-Plus savings account calculates profits on a daily
basis, giving maximum returns with the greatest flexibility. By opening a Rupee Plus Account
with JS Bank, the following services can be availed absolutely free of charge:
Online Inter-city Funds Transfer
Return Cheque (outward)
Demand Draft and Pay Order Issuance
By maintaining an average monthly balance of PKR 250,000 in the Rupee-Plus Account, you
can avail the following additional services absolutely free of charge:
Counter Cheques
Collection Cheque (Local)
Retained Mail
Stop Payment
Chequebook Issuance (25 leaves)
Small Locker*
ATM Card Issuance**
ATM Card Annual Fee Waiver
Telex / Postage
Statement Issuance
Balance Certificate
Rupee Current Account

The Rupee Current Account primarily targets individuals and companies that have a high
turnover of cheques. Ideal for volume based businesses, Rupee Current Account has no initial
balance requirement. In addition, if an average monthly balance of PKR 100,000 is maintained
in the Rupee Current Account, the following services would be absolutely free of charge:
Counter Cheques
Retained Mail
Stop Payment
Chequebook Issuance (25 leaves)
Small Locker*
ATM Card Issuance**
Telex / Postage
Statement Issuance
Balance Certificate
PLS Rupee Saving Account

The JS Bank PLS Saving Account is a Profit and Loss sharing account that offers competitive
returns on your savings with security and convenience. A PLS Rupee Saving Account holder
gets the following services absolutely free of charge:
In addition to this, by maintaining an average monthly balance of PKR 250,000 in the PLS
Saving Account, the following additional services can also be availed absolutely free of charge:
Counter Cheques
Retained Mail
Stop Payment
Cheque-book Issuance (25 leaves)
Small Locker*
ATM Card Issuance**
Telex / Postage
Statement Issuance
Balance Certificate
Rupee Basic Banking Account

This is a Rupee account that can be operated keeping a balance as low as Rs 1,000/-. Ideal for
salaried individuals and persons with low transaction turnover, Rupee Basic Banking Account
has the following salient features:
No transactional charges up to 2 deposit transactions and 2 checking withdrawals per

month.
No minimum balance requirements.
No charges to maintain the account.
Country wide banking facility
Foreign Currency Account

Current and Savings accounts in US$, Pound Sterling and Euros.
Muhib-e-Watan Account
Its never easy when loved ones are living abroad. Now with the JS Bank Muhib-e-Watan
Account, you have peace of mind in knowing that you can get the best return on your funds even
when your loved ones are miles away. Designed specifically for the needs of foreign remittance
beneficiaries, the JS Bank Muhib-e-Watan Account gives you great benefits and a high rate of
return so that you can enjoy the very best of life.
Facilities:
Great profits, paid every month
Account tailored specially for remittance customers
Fast processing for Muhib-e-Watan account holders
Easy and secure account opening*
Convenience of withdrawing funds from more than 100 JS Bank branches all over the country
24-hour convenience of withdrawing funds with your ATM card
Account opening with just PKR 5. No limit on amount kept in account. Therefore, the higher the
amount, the bigger the profit
In accordance with the State Bank of Pakistans PRI program, funds from anywhere in the world
may be received in Muhib-e-Watan account*
The facility of transferring funds from any bank to your account
Special Convertible Rupee Account

JS Bank offers Special Convertible Rupee Account to cater to the needs of non-resident
investors, who wish to trade freely in the shares quoted on the Stock Exchange of Pakistan
(Secondary Market).
The Operation of SCRA accounts is up to an extent of remittances received from abroad or by
transfer from a Foreign Currency Account maintained by non-resident investors in Pakistan. The
balance available therein can be used for purchase of any shares quoted on the Stock Exchange
of Pakistan (Secondary Market). The disinvestment proceeds against sale of previously
purchased shares through SCRA can be credited in this account. The SCRA accounts can also be
credited with dividend income against the shares held by non-resident investors.
The funds available in such accounts can be transferred outside Pakistan or credited to a foreign
currency account of non-resident investor maintained in Pakistan at any time without prior
approvals of SBP.
Departments of Branch
Various departments are working in all the branches of JS bank to facilitate the customers.
Following are the banking departments functioning in JS Bank Rahim Yar Khan branch.
1.
Account opening department.
2.
Cash department.
3.
Credit department.
4.
Lockers department.
5.
Bill clearing department.
6.
I.T department.
ACCOUNTS OPENING DEPARTMENT

Basic function of the accounts department is to open new account and facilitate the customer for
the account opening purpose. There are certain formalities which are to be observed for
opening of an account with a Bank. These formalities in brief are as under:
FORMAL APPLICATION:
The customer is to fill "Account Opening Form. It is a formal request by a customer to the bank
to allow him to have and operate the account.
Documents require for opening an account:
Copy of CNIC
Service certificate or student card.
Utility bill
Provisional receipt
KYC (Know Your Customer)
SPECIMEN SIGNATURE:
When the Banker is satisfied about the integrity of the customer, he agrees to open the account.
The Banker obtains the specimen signatures of the customer on the signature book or on card.

Posting the account on the system:
After that officer has to post the new account on computer system for further processing. During
the process customer id and account number is generated. New account remains active for one
day after that it is blocked by the head office until CNIC of the customer is verified from NADRA.
Cheque book issuing:
After the CNIC verification account opening officer has to issue a cheque book to customer so
that he can be able to make withdrawal from his account. Now a day in JS bank cheque book
issuing process is centralized that take 06 days to complete.
SECRECY:
The secrecy of depositors account is the. Responsibility of every official engaged in the Bank
service.
Types of accounts
Individual accounts:
Individual accounts are the most common personal investment accounts. Opened by single
person.
JOIN ACCOUNT:
A joint account occurs when two or more than two customers have one account. The parties to
a joint account are considered in law as they are one person.
Business accounts:
Business accounts can be opened by institutions, companies, partnerships, trusts and non-profit
organizations. Following documents are required.
BOOKS RELATING TO CUSTOMERS:

Pay-in-Slip
When money is to be deposited in the bank the pay in slip is to be filled. The object of this book
is to provide the customer with the banks acknowledgement for receipt of money to be credited
his account.
Cheque Book
A chequebook contains a number of cheques, which is given to a customer upon written request
and after marking the payment for the chequebook. It enables a customer to make withdrawal
from his account or make payment to various parties by issue of cheques.
GROUNDS FOR CLOSING THE CUSTOMERS ACCOUNT:
The banker may close the account of the customer due to following reasons:
i.
Notice by a Customer
ii. Death of a Customer

iii. Customers Insanity
iv. By order of court
I) NOTICE BY CUSTOMER
The banker closes the account of the customer on the application of the customer for closing his
account.
II) DEATH OF CUSTOMER

On death of his customer, the bank must stop payment on cheques drawn on him by the
deceased customer because the death revokes his authority to pay such cheque. The heirs or
the executors of the deceased customer are not authorized to operate on the account; it can act
only in accordance with provisions mentioned in the letter of probate issued by a competent
courts.
III) CUSTOMERS INSANITY

If the customer becomes insane or mental it terminates the bankers authority to act as his
customers agent. Since the banker customer relationship comes to end, in such as situation, it
is usually considered that the bankers authority to pay his customers cheques is revoked by
notice of insanity. However, the bankers treat their customers as it unless a fairly inclusive
evidence of the customers insanity is available to them.
IV) ORDER OF COURT
A court of law may serve a banker with an order in garnish proceeding in execution of a decree
prohibiting him from honoring a customers cheques.
CASH DEPARTMENT
Cash Department is very sensitive and risky part of the bank. Very causations and competent
personnel are needed for the Job. JS Bank has really such a diligent staff with appreciable
competencies and will to do work. Main function of cash department is to deal with cash
payment and cash receipts.
Cash deposit procedure:

The customer fills the pay slip. The cashier receives the pay slip and cash. He counts the cash
and makes the detail of the notes at the back of the pay slip. Then he compares the detail with
amount written on slip and signs the pay Slip. Then he credits the entries in the computer by
serial No, account type, Account number and amount. Puts the stamp of the cash Received on
the payment slip. The first portion is for bank record while other one is given to the customer.
Cash payments procedure:

When a customer comes to withdraw a certain amount from his account, he brings a Cheque
along with him. In this case the following steps are taken.
The cashier receives the cheque and checks it whether it is post dated or predated. Cheque can
be cashed within six months. A predated cheque cannot be cashed. He takes two signatures at
the back of the cheque from the bearer. He gives the cheque for posting at the computer. The
computer checks out whether there is balance in the account or not. Other instructions are also
received e.g. blocked, frozen, Etc. the posting is done in the computer and the cheque is
stamped posted with the serial number and date. He gives the cash to bearer and the respected
account is debited.
Online fund transfer:

Another function of the cash department is of online transfer of funds.
Customer has give filled remittances form with cash or without cash (from account transfer) to
the cashier in cash department who will then credits the beneficiary account.
Balancing cash at the end and transferring excess cash:

At the day end cash department is responsible for balancing the cash. Physical cash should be
balanced with the amount in the computer. Branchs limit for cash is 40 million which it can keep
within the branch over the night excess cash is transferred to NBP.
CREDIT DEPARTMENT
1. Introduction
2. Securities.
3. Types of credits
INTRODUCTION
The function of credit department is to lend money in the form of clean advances, against
promissory notes, as well as secured advances against tangible and marketable securities. The
bankers prefer such securities that do not run the risk of general depreciation due to market
fluctuations.
Common Securities for the bankers advances are as under:SECURITIES
1. Guarantees
When an application for advance cannot offer any tangible security, the banker may rely on
personal guarantees to protect himself against loss on advances or overdraft to the applicant.
2. Mortgage
A mortgage is the transfer of an interest in specific immovable property for the purpose of
security the payment of money advanced or to be advanced by way of loan, and existing or
future debt, or the performance of an engagement which may rise to a pecuniary liability. The
transfer is called a mortgagor, the transferee a mortgage.
3. Hypothecation
When property in the shape of goods is charged as security for a loan form the bank the
ownership and possession is left with the borrower, the goods are said to be Hypothecated The
essence of hypothecation is that neither the property in the goods not the possession of them
are possession is left with the borrower, the goods are said to be Hypothecated the essence of
hypothecation is that neither the property in the goods not the possession of them are

possessed by the lender, but the security is granted by means of letter of hypothecation, which
usually provides for a bankers charge on the hypothecation goods.
4. Pledge
In a pledge the ownership remains with pledge, but the pledge has the exclusive possession of
property until the advance is repaid in full. While in case of the default the pledge has the power
of sale after giving due notice.
5. Promissory Note
Sometimes promissory note is also accepted as a security, "A promissory note is an instruments
in writing containing an unconditional undertaking signed by the maker, to pay on demand or at
a fixed or determinable future time a certain sum of money only, to or to the order of certain
persons, or to the bearer or the instrument." A promissory note is incomplete until has been
delivered to payee or the bearer. Moreover, the sum promised in a promissory note may be
made by two or more makers who may be liable there on jointly and severally.
TYPES OF ADVANCES
The advances which are given by JS Bank Limited are as under:1. DEMAND FINANCE (Ordinary Loan)
Demand Finances are those advances which are allowed in lump sum for a fixed period and are
repayable lump sum or gradually in installments.
TYPES OF ADVANCES
a. Demand Finance (Packing Credit)
Scheme introduced by State Bank of Pakistan for exporter of carpet, surgical
instruments, at zero percent rate of interest. While banks provides at concessional rate
of interest.
b. Demand Finance (Staff)
Loans are offered to the staff of the following four categories.
i.
House Building Loans against mortgage of property.
ii. Loan for purchasing vehicles.

iii. Loan equivalent to months salary.
2. RUNNING FINANCE (Overdraft)

Running finance (old name overdrafts) are advances, which are generally, given to meet
temporary requirements of the customers. A good customer use the banks running finance limit
as a mean of protecting his credit in the market and as a line of security defense to meet his
commitments.
TYPES OF RUNNING FINANCE
I.
Unsecured
Under such type of overdraft the bank pay upon the personal security of the customers
mentioned on the customers account.
II. Secured
Under this type of overdraft the bank allows his customer to withdraw more than his
deposits after giving security against the amount overdrawn.
The securities against which they given are:
i.
Share certificate, Saving certificate
ii. Deposits
iii. Mortgage of property
iv. Guarantee of person
SMALL LOANS
Loan is allowed to contractors clearing and forwarding agents.
3. FINANCE AGAINST THE FOREIGN BILLS (FAFB)
The advance facility is allowed both to local foreign bills and is classified as under:i.
FAFB (Local) advance against Railway receipts and truck receipt, a company with bills
of exchange and invoices, are given under this head.
ii. FAFB (Foreign) advances against foreign bill, covering bills of exchange bills of lading
airway bills of exchange bills of lading airways bills etc.

4. AGRICULTURE LOANS
Loans to the farmers with holding up to 25 acres for meeting their short terms, medium and long
terms Agricultural production requirements, such as:
i.
Agricultural inputs
ii. Tube wells

iii. Live Stock Framing
iv. Land improvement
v. 5. INDUSTRIAL LOANS
Besides the short-term loans which play a part in working capital medium and long-term loans
are also given to industrial sector for purchase of machinery and other capital nature goods.
BILLS CLEARING DEPARTMENT

INTRODUCTION
Every bank acts in two way i.e.
i.
Paying Bank
ii. Collecting Bank

Here in theory no legal obligation on a banker to collect cheques, drawn up to other
banks for a customer. It is, however, an important function of crossed cheques. A large part of
this work is carried out through the N.I.F.T.
NIFT- National Institutional Facilitation Technologies (Pvt.) Limited:
NIFT is a joint venture between a consortium of six major banks and private sector. It is
responsible for the establishment and management of automated clearinghouse facilities in
Pakistan. NIFT is proactively involved in the modernization of payment systems in Pakistan.
FUNCTION OF CLEARING DEPARTMENT
The following are the main functions of clearing department.

4. To accept transfer deliveries and clearing cheques from the customer of the branch and
to arrange for their collection.
5. To arrange the payment of cheque drawn on the branch and given for collection to any
other branch of JS Bank of Pakistan or any other members, or sub-members of the local
clearing area..
6. To collect amounts of cheques drawn on members, sub-members of the local clearing
house, sent for collection by those JS Bank Limited, branches which are not represented
a the local clearing area.
PROCEDURE OF DEPOSITING CHEQUES IN CLEARING DEPARTMENT
Whenever a customer wants to deposit cheque, etc, he fills a pay in slip and hands it
over the counter along with the instruments he wants to deposit with bank. As far as possible,
the customer desire that on of the staff member fill in a slip for him, he should be obliged
promptly.
One portion of the perforated pay in slip is handed over to the depositor and the portion
becomes the regular portion of a credit voucher
TYPES OF CHEQUES COLLECTED BY CLEARING DEPARTMENT
a. Transfer Cheques
Transfer cheques are those cheques, which are collected and paid by the same branch
of bank.
b. Transfer Delivery Cheques
Transfer Deliver cheques are those cheques, which are collected and paid by two
different branches of a bank, situated in the same city.
c. Clearing Cheques
Clearing cheques are those cheques in which the payee (Person who deposit cheques
for collection) and the drawer of a cheque maintain the account with different banks.
These clearing instruments are handed over to NIFT after posting necessary stamps and
checking them for any errors. Then further process of clearing is carried on the behalf of NIFT.
Services
Mobile Banking
In line with its vision to make banking easier for everyone, JS Bank offers Mobile Banking on
WAP portal at https://m.jsbl.com for all customers with internet enabled mobile phones and
Pakistans first Android App for all Android based smart phone users.
Mobile Banking Subscription
Subscribing to JS Mobile and start using it is as simple as 1, 2 and 3:
1) Call us at 0800-01122 and get yourself a TPIN to use mobile banking
2) Log-in to https://m.jsbl.com or download JS Mobile Android App from Google Play

Store
3) Click here to read JS Bank Mobile Banking Terms and Conditions and accept it upon
first log-in to get started.
ATMs
JS Bank ATMs are a convenient and hassle-free way for customers to get cash 24/7. JS Bank is a
member of 1-LINK network in Pakistan and of VISA network that operates globally. So any
Visa Debit/Credit and Prepaid Cards issued by any bank in the world can be used on JS Bank
ATMs to withdraw cash. Moreover we accept all ATM cards issued by banks in Pakistan that are
member of 1-LINK or MNET networks.
In addition to cash withdrawal, JS Bank customers can avail following facilities from JS Bank
ATMs:
Balance enquiry
Mini Statement
Utility bills payment

-Electricity
-Gas
-PTCL & Mobile
Change PIN
Card Blocking
Cheque Book Ordering
IBFT (Inter Bank Fund Transfer)
Internet Banking
Welcome to the world of JS Bank Internet Banking. With JS Bank Internet Banking service you
can access and manage your accounts anywhere, anytime.
You can enjoy following amazingly convenient internet banking facilities:
Account Statement
Inter Bank Funds Transfer (IBFT)
Internal Funds Transfer (IFT)
Utility Bill Payments
Mobile Phone Payment and Top-ups
Instrument Status Inquiry
Cheque Stop Payment
ATM/Debit Card Blocking
Chequebook Request
Paper Statement Request
Pay Order/Demand Draft Request
Standing Instructions
Utility Bill Payment System

JS Bank Utility Bill Payment Service (UBPS) offers the ease of paying your monthly utility and
mobile phone bills instantly. UBPS facility can be availed through JS Bank Internet Banking
from the comfort of your home or from any JS Bank ATM near you. And whats more, there are
no charges for any bill payment through UBPS!
Currently JS Bank customers can utilize this facility for following payments:
Utilities:
MEPCO, HESCO, SSGC, SNGPL, KESC, GEPCO, LESCO, PTCL
Post Pay Mobile:
Telenor, Warid, Ufone, Mobilink, Zong
Mobile Top-up:
Telenor, Warid, Ufone, Mobilink, Zong
Stay tuned, JS Bank is adding more companies for your convenience. Start paying your bills
from today and get rid of the hassle of long queues forever.
Inter Bank Funds Transfer

Inter Funds Transfer (IFT) facility allows our customers to transfer funds from one account to
another account within JS Bank. IFT facility can be availed from JS Bank Internet Banking at
any time.
Inter bank Funds Transfer (IBFT) facility allows our customers to transfer funds to any other
account of any other 1-LINK member bank in Pakistan at the click of the button. Our customers
can avail IBFT facility from JS Bank Internet Banking and from our growing network of ATMs
across Pakistan. Funds are transferred instantly.
JS Bank Inter Bank Funds Transfer (IBFT) facility offers you the following benefits:
Real-time payments
No hassle of cash or writing cheques
Convenient channels ATMs and Internet Banking
Security and Reliability
24-Hour transfer facility
Maximum limit of Rs.250,000 in a day (single transaction limit of Rs.100,000)
JS Gold Finance
JS Bank offers you the chance to convert your gold ornaments into working capital for your
business or investment needs! JS GoldFinance is a unique financing facility that offers term or
revolving loan against gold ornaments!
JS Car Aamad
JS Bank offers you a chance to drive away your dream car. JS CarAamad is an installment-based
loan for purchase of new, used & imported vehicles, which is the smartest auto loan ever!
Features of JS CarAamad:
Quickest & hassle-free processing
Lowest down payment (as low as 10%)
Flexible tenure 1 7 years
First year insurance financing
Insurance through reputable insurance partners EFU General Insurance & Adamjee
General Insurance at lowest rates
Early settlement option (Nominal Charges apply)
Financing based on fixed rate of 1-Year KIBOR + 7%
Co-borrower facility
No hidden charges
Financing from Rs. 300,000 to Rs. 5,000,000
No down payment or processing fee payments before approval
CLEARING SECTION:
Every Bank performs the paying and receiving functions. Cheques are received and
collected which are drawn up to Banks for customers. Similarly the cheques drawn on different
Banks and deposited by Banks own customers for collection within the city is know as clearing
The functions of receiving and paying is mostly done through the clearing house. A clearing
house can be defined as "AA place where that representatives of all Bank get together to settle
the receipts and payment of cheques drawn on each other" Clearing House provides the facility
which can hardly be dispensed with especially, in case of crossed cheques.
There are two main types of clearing.
i Outward clearing
ii Inward clearing.
2.3.1 OUTWARD CLEARING:
It includes those cheques and other instruments which are sent by the Bank to the Banks for
payment on behalf of its own clients. Cheques are sent to clearing house thorough local main
branch.
A delivery message from the local main branch comes to every branch at a fixed time to pick its
outward clearing or outward returns as the case maybe.
Outward Clearing at Branch
a. Account number of payee/endorsee is written on the back side of the cheques.
b. The instrument and the paying in slips are separated.

c. The instruments are sorted I Bank-wise and branch wise.
d. Schedules are prepared.
e. Jotting of all the schedules are taken in the clearing House statement. Amount of the
cheques
in written in the "Delivered" and to pay column.
f. After balancing the outward clearing, the pay in slips are released to C.D department.
g. After balancing, a transfer debit voucher is prepared.
h. The instrument, schedules are delivered to the messenger from the main branch.
2.3.2 INWARD CLEARING.
The cheques drawn are called inward clearing drawn on JS Bank through its representatives.
On the Bank presented by other Banks for payment it includes those cheques and other
instruments of Pakistan branches which other Banks present at the clearing house.
Inward Clearing at the Drawn Branch
a. Numbers of instruments noted in the schedules are verified immediately on receipt.
b. The amount's of all the instruments are jotted down and totaled. If should be equal to
the amount mentioned in schedule from the local main branch.
c. The amounts are debarred to the relevant accounts if otherwise in order.
2.3.3 TYPES OF CHEQUES COLLECTED BY CLEARING SECTION:

2.3.3.1 TRANSFER CHEQUES:
These are the cheques which are collected and paid by same branch of JS BANK For example
Mr. Ali is a customer of JS BANK of CITY branch and draws a cheque in favor of Mr. Hussain who
is also the customer of the same branch.
TRANSFER DELIVERY CHEQUES:
The cheques which are collected and paid by two different branches of a Bank situated in the
same city. For example a person draws a cheque on N.B.P. main branch, D.I.Khan in favor of
another person who maintains an account with N.B.P. Rakh Mandra branch, D.I.Khan.
CLEARING CHEQUES:
When the payee/endorse and the drawer of cheque maintains account with
different Banks, the collection Bank in any one of the following methods:a. It can collect cash by sending its representative with the cheques to each of the
paying Banks.
It is not so much appropriate.
b. The Bank maintains an account with the paying Bank.
c. The cheques can be exchanged by representative of the various Banks who meet at a
fixed
time and at a fixed place. This is the most efficient method of collection and paying
cheques.
2.3.4 FUNCTIONS OF CLEARING SECTION IN A BRANCH:
a. To accept transfer, transfer delivery and clearing cheques from the customer of the
branch and to arrange for their collection.
b. To arrange payment of cheques drawn on the branch and gives for collection to any
other
branch of H.B.L. or any other member or such member of local clearing house.
c. To collect amounts of cheques drawn on members of the local clearing house sent for
collection by N.B.P. branches not represented at the local clearing house.
2.3.5 PROCEDURE FOR CLEARANCE OF CHEQUE:
The customers are provided with the copes of pay In-slip, whenever the customer wants to
deposit any cheque, he fills in the pay in slip himself and hands it over the counter along with
the instrument.
SWOT ANALYSIS
SWOT stands for a firms internal Strengths and Weaknesses and its external Opportunities and
Threats. The purpose of such analysis is to build on companys strengths in order to exploit
opportunities and counter threats and to correct companys weaknesses. SWOT analysis is
based on the assumption that if managers carefully review such strengths, weaknesses,
opportunities, and threats, a useful strategy for ensuring organizational success will become
evident.
Strengths and weaknesses typically relate to the internal environment of an organization,
whereas opportunities and threats are brought about by the external environment of an
organization. In the following section, both internal and external analyses of JS BANK IMITED
are outlined:
7.1 INTERNAL ANALYSIS:

Internal analysis of a firm is the analysis of its strengths and weaknesses. Unless a firm has
internal strengths and controls its weaknesses, it cannot take advantage of opportunities and
escape threats which the external environment presents. Following are the main strength and
weaknesses of JS BANK.
7.2 STRENGTH:
Strength can be defined as an area where a company is best at doing something or a feature
that puts the company at an advantage in comparison to its competitors. JS BANK enjoys the
following strengths:
1. JS BANK is a well established bank enjoying long history of over 65 years of experience
and profitable operation.
2. JS BANK was the first privatized bank that gives it an edge over other nationalized banks
as it can develop any strategy consistent with the demand of market and free from any
political or bureaucratic influence.
3. JS BANK is the largest private bank in Pakistan now and people trust is very high.
4. It has the largest branch network among private banks of Pakistan
5. JS BANK is the market leader in introduction of e-banking and it has the largest.
6. JS BANK was rated the best domestic bank for two consecutive years of 2000 and 2001
by Euro money, a leading international publication.
7. JS BANK has forged strategic alliances with international banks for expanding its
network further, both locally and internationally.
8. JS BANK has the ability to bring innovative products and services like personalized
service, electronic funds Transfer, sophisticated financial products such as electronic
banking, auto-teller machines and evening banking.
9. JS BANK has been very effective in controlling costs as it successfully restructured itself
after its privatization. During this process more than 1,600 employees were relieved
under a golden handshake scheme and 110 branches were closed.
10. Excellent branches appearance gives an edge to JS BANK over other banks.The branches
are well furnished even in less developed areas where other banks branches give a poor
view.
7.3 WEAKNESSES:
A weakness is defined as an area in an organization where the organization is not as good at
doing something as its competitors or a thing which an organization lacks thus putting the
organization at disadvantage in comparison to its competitors. Based on the above definition,
JS BANK has the following weaknesses.
1. Mission of JS BANK is not well defined.
2. Though JS BANK is second largest bank in Pakistan, yet the fact remains that it is not
market leader as NBP. Its total assets are always less than NBP total assets.
3. Now as it is a privatize bank that is why GOVERNAMENT support to JS BANK decreased
as it was in past.
4. Employees at branch level are not properly motivated to work by heart. They take the
all routine activities as a boring job.
5. Most of the employees lack managerial training as they are not properly educated. Due
to seniority, they have moved up on the hierarchy line to Grade- I, II or III positions
having hardly bachelor degrees. This type of senior staff cannot apply the modern and
innovative techniques of management in decision making almost computer knowledge.
7.4 EXTERNAL ANALYSIS:
An organization has to monitor its environment constantly to keep up with new developments
and changes in the environment. A change in the external environment may be either an
opportunity or threat. In either case, the organization has to properly use it strengths to avail
the opportunities and avoid or minimize the negative effects of threats.
Following are the main opportunities and threats of JS BANK.

7.4.1 OPPORTUNITIES:
An opportunity can be defined as a change in external environment which if
properly
sales,
exploited
market
with
share,
or
the
organizational
income.
Using
its
strengths
will
strengths,
JS
result
BANK
in
can
enhanced
avail
the
following opportunities:
1. It can introduce debit card system or may convert the existing ATM cards into a
complete debit card.
2. New products like personal loans, mortgage and auto leasing and cash management
which diversify credit risk and add to revenue generating products, are currently
provided in big cities like Lahore, Islamabad, Karachi, and Rawalpindi, these products
may be tested for success in other small areas of PAKISTAN in different provinces.
3. As all around the world remittances of money are strictly monitored so as the money
remitted may not fall in hands of so-called terrorists. For that all conventional money
laundering through Hundies have been stopped, there is an opportunity for JS BANK to
extend its branch network to various countries emphasizing mainly on introducing
electronic fund transfer facilities.
7.4.2 THREATS:
Threat can be defined as a change in external environment which if not met with proper
strategies will result in loss of revenues, market share, or income. In the context of JS BANKs
external environment,
the following potential threats exist:
1. The frequent reduction on 6-month and 12-month Treasury Bills discount rates by SBP
may create pressure on the banks profitability.
2. The low discount rates are also negatively influencing the advances rates which may
affect the banks profits from the other side.
3. Foreign banks operating in Pakistan are playing a significant role by incorporating new
technologies and providing better quality services thus creating a threat to the local
banks especially to JS BANK which tries to develop core competence in electronic based
products. Policies of privatization, foreign exchange reforms, and structural adjustments
have increased the inflow of foreign resources through direct and portfolio investment.
In trade financing, the role of foreign banks is even more significant, as approximately
30 percent of the total trade of the country is transacted through them. Major portion
of the trade financing is for importers to establish letters of credit.
Balance Sheet
Items
Cash and balances with treasury banks
2014
(Rs.'000)
2013
(Rs.'000)
2012
(Rs.'000)
9,041,590
7,775,070
5,027,942
433,697
542,126
1,193,864
Lendings to financial institutions
16,807,304
21,585,799
3,740,958
Investments - net
85,761,502
43,855,194
47,884,719
Advances - net
56,715,791
33,769,008
19,909,385
Operating fixed assets
3,912,851
3,750,784
3,412,167
1,052,958
860,704
6,708,376
2,417,820
1,989,038
179,381,111
114,748,759
84,018,777
Bills payable
1,380,020
1,414,793
713,747
Borrowings
50,537,973
20,150,846
8,704,685
Deposits and other accounts
107,429,838
80,055,276
61,934,787
3,532,454
1,820,276
1,730,620
163,184,542
103,441,191
73,083,839
16,196,569
11,307,568
10,934,938
Share capital
10,724,643
10724643
10,724,643
Discount on issue of shares
-2,105,401
-2,105,401
-2,105,401
Preference share
1,500,000
513,706
301,698
231,613
1,384,998
239,766
-62,157
12,017,946
9,160,706
1,863,194
Balances with other banks
Deferred tax assets - net

Other assets
LIABILITIES
Sub-ordinated loans
--
Liabilities against assets subject to finance lease

Deferred tax liabilities net
Other liabilities
NET ASSETS
304,257
REPRESENTED BY
Reserves
Unappropriated profit
Non-controlling interest
Surplus on revaluation of assets - net of tax
2,135,442
1,866,171
14,153,388
11,026,877
10,651,892
2,043,181
16,196,569
280,691
283,046
11,307,568
10,934,938
Source: JS Bank, (2012-2014) Annual Reports
Thousands
Trend of Balance Sheet Items in absolute figures

100,000
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
2014
2013
2012
Cash and
balances
with treasury
banks
Balances
with other
banks
Lendings to
financial
institutions
Investments
- net
Advances net
2014
9,041,590
433,697
16,807,304
85,761,502
56,715,791
2013
7,775,070
542,126
21,585,799
43,855,194
33,769,008
2012
5,027,942
1,193,864
3,740,958
47,884,719
19,909,385
.
8,000,000
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000
2014
2,000,000
2013
1,000,000
2012
Operating fixed
assets
Deferred tax
assets - net
Other assets
2014
3,912,851
2013
3,750,784
1,052,958
2,417,820
2012
3,412,167
860,704
1,989,038
6,708,376

120,000,000
100,000,000
80,000,000
60,000,000
2014
40,000,000
2013
2012
20,000,000
0
Bills payable
Borrowings
Deposits and
other accounts
2014
1,380,020
50,537,973
107,429,838
2013
1,414,793
20,150,846
80,055,276
2012
713,747
8,704,685
61,934,787
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2014
2,000,000
2013
2012
-2,000,000
-4,000,000
Share capital
Discount on
issue of shares
Preference
share
Reserves
10,724,643
-2,105,401
1,500,000
513,706
2013
10724643
-2,105,401
301,698
2012
10,724,643
-2,105,401
231,613
2014

2,500,000
2,000,000
1,500,000
1,000,000
500,000
2014
2013
2012
-500,000
Unappropriated
profit
Non-controlling
interest
Surplus on
revaluation of
assets - net of
tax
2014
1,384,998
2,135,442
2,043,181
2013
239,766
1,866,171
280,691
2012
-62,157
283,046
The deposits are showing up ward trend that is mainly because the current deposits have increased.
Fixed deposits are the main source of the fund, which the bank can safely advance. The fall in fixed
deposit and constant falling of interest rate will directly affect the advances capacity of bank. So
bank margin on advances is shrinking. Thats why bank reserve shift from advances to investment.
Share holder equity shows increase tremendously in year 2003. Long term assets shows slightly
increase, the main reason for which is the increasing in long term investment.
Summarized INCOME STATEMENT

Financial year ended December 31
Items
2012
(Rs.'000)
2013
2014
Mark-up / return / interest earned
11,253,707
6,969,555
6,168,310
Mark-up / return / interest expensed
7,184,674
4,512,561
3,731,733
Net Mark-up / Interest income
4,069,033
2,456,994
2,436,577
(Provision) / reversal against non-performing loans and advances
-657,634
-429,932
-457,504
(Provision) / reversal of diminution in value of investments
236,985
165,498
-72,424
-420,649
-264,434
-529,928
3,648,384
2,192,560
1,906,649
1,449,560
1,115,133
818,790
Dividend income
67,148
386,681
82,636
Income from dealing in foreign currencies
271,765
269,554
205,775
1,551,557
525,393
938,665
352,667
159,138
37,762
Other income
-115,770
141,428
64,556
Total non mark-up / interest income
3,576,927
2,597,327
2,148,184
7,225,311
4,789,887
4,054,833
4,531,755
3,647,837
2,892,734
Bad debts written off directly
Net mark-up / interest income after provisions
NON MARK-UP / INTEREST INCOME

Fee, commission and brokerage income
Gain on sale of securities net

Unrealised gain / (loss) on revaluation of investments
classified as held-for-trading
Share of profit from associate - net of tax
NON MARK-UP / INTEREST EXPENSES

Administrative expenses
Other provisions / write offs
24,074
-25,427
Fixed assets written off

Other charges
80,497
64,206
-2,630
4,636,326
3,712,043
2,864,677
2,588,985
1,077,844
1,190,156
PROFIT BEFORE TAXATION
2,588,985
1,077,844
1,190,156
Taxation
PROFIT AFTER TAXATION
-690,718
-240,080
-370,323
1,898,267
837,764
819,833
1.35
0.44
0.71
Total non-mark-up / interest expenses
Extra ordinary / unusual items
Earnings per share
Summarized Balance sheet

Items
2014
(Rs.'000)
(%)
2013
(Rs.'000)
(%)
2012
(Rs.'000)
(%)
9,041,590
100
7,775,070
86
5,027,942
56
433,697
100
542,126
125
1,193,864
275
16,807,304
100
21,585,799
128
3,740,958
22
Investments - net
85,761,502
100
43,855,194
51
47,884,719
56
Advances - net
56,715,791
100
33,769,008
60
19,909,385
35
3,912,851
100
3,750,784
96
3,412,167
87

Other assets
1,052,958
860,704
6,708,376
100
2,417,820
36
1,989,038
30
179,381,111
100
114,748,759
64
84,018,777
47
Bills payable
1,380,020
100
1,414,793
103
713,747
52
Borrowings
50,537,973
100
20,150,846
40
8,704,685
17
107,429,838
100
80,055,276
75
61,934,787
58
LIABILITIES
Sub-ordinated loans
--

Deferred tax liabilities - net
304,257
100
3,532,454
100
1,820,276
52
1,730,620
49
163,184,542
100
103,441,191
63
73,083,839
45
16,196,569
100
11,307,568
70
10,934,938
68
Share capital
10,724,643
100
10724643
100
10,724,643
100
-2,105,401
100
-2,105,401
100
-2,105,401
100
Preference
share
Prepared
By: Ahmad
Noor Ud Din
1,500,000
100
Other liabilities
NET ASSETS
REPRESENTED BY
Reserves
513,706
100
301,698
59
231,613
45
1,384,998
100
239,766
17
-62,157
-4
12,017,946
100
9,160,706
76
1,863,194
16
2,135,442
100
1,866,171
87
14,153,388
100
11,026,877
78
10,651,892
75
2,043,181
100
280,691
14
283,046
14
100
11,307,568
70
10,934,938
68
16,196,569
Summarized Balance sheet

Items
2012
(Rs.'000)
2013
2014
11,253,707
100
6,969,555
61.931
6,168,310
54.811
7,184,674
100
4,512,561
62.808
3,731,733
51.94
4,069,033
100
2,456,994
60.383
2,436,577
59.881
-657,634
100
-429,932
65.376
-457,504
69.568
236,985
100
165,498
69.835
-72,424
-30.56
-420,649
100
-264,434
62.863
-529,928
125.98
3,648,384
100
2,192,560
60.097
1,906,649
52.26
1,449,560
100
1,115,133
76.929
818,790
56.485
Dividend income
67,148
100
386,681
575.86
82,636
123.07
271,765
100
269,554
99.186
205,775
75.718
1,551,557
100
525,393
33.862
938,665
60.498
352,667
100
159,138
45.124
37,762
10.708
Other income
-115,770
100
141,428
-122.2
64,556
-55.76
3,576,927
100
2,597,327
72.613
2,148,184
60.057
7,225,311
100
4,789,887
66.293
4,054,833
56.12
4,531,755
100
3,647,837
80.495
2,892,734
63.833
24,074
100
-25,427
-105.6
(Provision) / reversal against non-performing loans and

advances
(Provision) / reversal of diminution in value of
investments

Gain on sale of securities - net


Prepared
Ahmad Noor
Udoffs
Din
OtherBy:
provisions
/ write

Other charges
80,497
100
64,206
79.762
-2,630
-3.267
4,636,326
100
3,712,043
80.064
2,864,677
61.788
2,588,985
100
1,077,844
41.632
1,190,156
45.97
2,588,985
100
1,077,844
41.632
1,190,156
45.97
Taxation
-690,718
100
-240,080
34.758
-370,323
53.614
1,898,267
100
837,764
44.133
819,833
43.188
1.35
100
0.44
32.593
0.71
52.593
Earnings per share
Summarized Verticle Balance sheet

Items
2014
(Rs.'000)
(%)
2013
(Rs.'000)
(%)
2012
(Rs.'000)
(%)
9,041,590
56
7,775,070
69
5,027,942
46
433,697
542,126
1,193,864
11
16,807,304
104
21,585,799
191
3,740,958
34
Investments - net
85,761,502
530
43,855,194
388
47,884,719
438
Advances - net
56,715,791
350
33,769,008
299
19,909,385
182
3,912,851
24
3,750,784
33
3,412,167
31
1,052,958
860,704
6,708,376
41
2,417,820
21
1,989,038
18
179,381,111
1,108
114,748,759
1,015
84,018,777
768

Other assets
LIABILITIES
Bills payable
1,380,020
1,414,793
13
713,747
Borrowings
50,537,973
312
20,150,846
178
8,704,685
80
107,429,838
663
80,055,276
708
61,934,787
566
Sub-ordinated loans
--
304,257
3,532,454
22
1,820,276
16
1,730,620
16
163,184,542
1,008
103,441,191
915
73,083,839
668
16,196,569
100
11,307,568
100
10,934,938
100

Deferred tax liabilities - net
Other liabilities
NET ASSETS
REPRESENTED BY
Share capital
10,724,643
66
10724643
95
10,724,643
98
-2,105,401
-13
-2,105,401
-19
-2,105,401
-19
Preference
share
Prepared
By: Ahmad
Noor Ud Din
1,500,000
Reserves
513,706
301,698
231,613
1,384,998
239,766
-62,157
-1
12,017,946
74
9,160,706
81
1,863,194
17
2,135,442
13
1,866,171
17
14,153,388
87
11,026,877
98
10,651,892
97
2,043,181
13
280,691
283,046
100
11,307,568
100
10,934,938
100
16,196,569
Summarized Verticle Income Statement

2012
(Rs.'000)
11,253,707
100
6,969,555
100
6,168,310
100
7,184,674
63.8
4,512,561
64.7
3,731,733
60.5
4,069,033
36.2
2,456,994
35.3
2,436,577
39.5
0
(Provision) / reversal against non-performing loans and
advances
(Provision) / reversal of diminution in value of
investments
-5.8
-429,932
-6.2
-457,504
-7.4
236,985
2.11
165,498
2.37
-72,424
-1.2
-420,649
-3.7
-264,434
-3.8
-529,928
-8.6
3,648,384
32.4
2,192,560
31.5
1,906,649
30.9

-657,634
1,449,560
12.9
1,115,133
16
818,790
13.3
Dividend income
67,148
0.6
386,681
5.55
82,636
1.34
271,765
2.41
269,554
3.87
205,775
3.34
1,551,557
13.8
525,393
7.54
938,665
15.2
Gain on sale of securities - net

0
352,667
3.13
0
159,138
2.28
0
37,762
0.61
0
Other income
-115,770
-1
141,428
2.03
64,556
1.05
3,576,927
31.8
2,597,327
37.3
2,148,184
34.8
7,225,311
64.2
4,789,887
68.7
4,054,833
65.7

Prepared
Ahmad Noor
Udoffs
Din
OtherBy:
provisions
/ write
0
4,531,755
40.3
24,074
0.21
0
3,647,837
52.3
2,892,734
46.9
-25,427
-0.4
Other charges
80,497
0.72
64,206
0.92
-2,630
-0
4,636,326
41.2
3,712,043
53.3
2,864,677
46.4
2,588,985
23
1,077,844
15.5
1,190,156
19.3
2,588,985
23
1,077,844
15.5
1,190,156
19.3
Taxation
-690,718
-6.1
-240,080
-3.4
-370,323
-6
1,898,267
16.9
837,764
12
819,833
13.3
RATIO ANALYSIS
A ratio is a quantitative relation between two magnitudes of the same kind. In ratio analysis, the
financial ratios of the firm are compared to that of its competitors. This comparison allows the
firm to detect major operating differences, which if corrected, will increase its efficiency.
Another very popular method of ratio analysis is to compare the firms financial ratios to
industry average or similar form in industry or to our own past performance.
Before discussion financial ratios, three cautions are in order:
(i) A single ratio does not generally provide sufficient information to judge the overall
performance of the firm. Only when a group of ratios is used, a reasonable judgment concerning
the firms overall financial state can be made.
(ii) An analyst, when comparing financial statement, should ensure that predetermined uniform
standards are used for this purpose.
(iii)It must be ensured that the data used in calculating financial ratios have been developed in
the same manner and are sound and reliable.
There is no doubt that financial ratios are a useful guide for managerial decision-making but
these are not exact and definite. Ratios only suggest the questions that need to be answered and
provide no answers.
Let us now calculate some of the key financial ratios of JS Bank for the years 2012-2014 and try
to answer the questions that these ratios suggest.
These ratios are calculated from the Balance Sheet and Profit and Loss Account of JS Bank.
1.Earning Assets to Total Assets
Earning Assets to Total Assets = Average Earning Assets / average total assets
Description
2014
2013
2012
Percentage (%)
89.20
90.98
89.20
Earning Assets to Total Assets

91.5
90.98
91
Percentage
90.5
90
89.73
89.5
89.2
89
88.5
88
2014
2013
2012
Year
Analysis:
This ratio shows how well bank management put bank assets to work. High-performance of JS
bank shows a high ratio which shows the good management of bank. The ratio of 2013 is
highest in three years which shows the best management of JS bank assets but overall
performance in three years is good.
2.Interest Margin to Earning Assets
Interest Margin to Earning Assets = Interest Margin / Earning Assets
Description
2014
2013
2012
Percentage (%)
2.49
2.39
3.25
Interest to Earning Assets

3.5
3.25
Percentage
2.5
2.49
2.39
2
1.5
1
0.5
0
2014
2013
2012
Year
Analysis:
This ratio is a key determinant of bank profitability, for it provides an indication of
managements ability to control the spread between interest income and interest expense. In 2012
this ratio is high which is 3.25 which is good for JS Bank but in next year it decline to 2.39
which is not a good sign for bank.
3.Equity Capital to Total Assets
Equity Capital to Total Assets = Average Equity / Total Assets
Description
2014
2013
2012
Percentage (%)
7.89
9.61
12.70
Equity Capital to Total Assets

14
12.7
12
9.61
Percentage
10
8
7.89
Equity Capital to Total Assets
4
2
0
2014
2013
2012
Year
Analysis:
This ratio is a key determinant to measures to extent to equity ownership in the bank. This
ownership provides the cushion against the risk of using debt and leverage. In our three year
analysis this ratio is decreasing year by year. This was good in 2012 but in next years it is
coming down which is requires keen attention of management.
4.Deposit Time Capital

Deposit Time Capital = Average deposits / Average Shareholders equity
Description
2014
2013
2012
Time (x)
6.63
7.08
5.66
Deposit Time Capital

8
7
6.63
7.08
5.66
Time
5
4
Deposit Time Capital
3
2
1
0
2014
2013
2012
Year
Analysis:
This ratio of deposits times capital concerns both depositors and stockholders. To some extent it
is a type of debt/equity ratio, indicating a banks debt position. More capital implies a greater
margin of safety. This ratio is high in 2013 which is not a good for JS bank but is decreasing in
2014 which is a good sign.
5. Loan to Deposits
Loan to Deposits = Average Total Loans / Average Deposits
Description
2014
2013
2012
Percentage (%)
52.80
42.18
32.15
Loan to Deposits
60
52.8
50
Percentage
42.18
40
32.15
30
Loan to Deposits
20
10
0
2014
2013
2012
Year
Analysis:
Average total loans to average deposits is a type of asset to liability ratio. Loans to deposit ratio
show an increasing trend in 2014 as compare to 2012. This trend is observed as the advances
and deposits both are increasing but advances are increasing more rapidly than deposits.
1.Time Interest Earned Ratio
Time Interest Earned = Recurring earnings, excluding interest exp, tax exp, and noncontroling interest /
Interest expense, including capitalized interest
Description
2014
2013
2012
Times (x)
1.55
1.29
1.40
Time Interest Earned Ratio

1.8
1.6
1.55
1.4
1.29
1.4
Times
1.2
1
0.8
Time Interest Earned Ratio
0.6
0.4
0.2
0
2014
2013
2012
Years
Analysis:
It indicates a banks long-term debt paying ability form the income statement view. It should be
high for suitable coverage of interest over the years indicates a good record like 2014; a low ratio
indicates a poor position such as in 2013.
Fixed Charge Coverage Ratio
Fixed Charge Coverage Ratio = Recurring earnings, excluding interest exp, tax exp, and noncontroling interest
+ Interest portion of rental/Interest expense, including capitalized interest
+ Interest portion of rental
Description
2014
2013
2012
Times (x)
1.55
1.29
1.40

1.8
1.6
1.55
1.4
1.29
1.4
Times
1.2
1
0.8
0.6
0.4
0.2
0
2014
2013
2012
Years
Analysis:
It indicates a banks long-term debt paying ability form the income statement view. It should be
high for suitable coverage of interest over the years indicates a good record like 2014; a low ratio
indicates a poor position such as in 2013.
3.Debt Ratio
Debt Ratio = Total Liabilities / Total Assets
Description
2014
2013
2012
Percentage (%)
0.91
0.90
0.87
Debt Ratio
0.92
0.91
0.91
0.9
Percentage
0.9
0.89
0.88
0.87
Debt Ratio
0.87
0.86
0.85
2014
2013
2012
Year
Analysis:
It shows the long term debt paying ability of JS Bank. Debt ratio in all years is less than 1 and it
is good for the bank. Low debt ratio show strong position of JS Bank. This ratio is increasing
which requires the attention of the bank management.
4.Debt to Equity Ratio
Debt to Equity Ratio = Total Debt / Total Equity
Description
2014
2013
2012
Percentage (%)
11.53
9.30
6.80
Debt to Equity Ratio

14
12
11.53
9.3
Percentage
10
8
6.8
Debt to Equity Ratio
4
2
0
2014
2013
2012
Years
Analysis:
JS Banks upward trend of Debt to Equity ratio shows that the bank is not relying in debt financing.
The ratio of 2014 as compared to 2012 has increased.

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The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

My report is dedicated to my parents, teachers and my cute friends who are

May! Allah Give them Long Life (AMEEN)

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

HISTORY AND DEVELOPMENT OF BANKING IN PAKISTAN

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

1. STATE BANK OF PAKISTAN (CENTRAL BANK)

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

There are two types of the COMMERCIAL BANKS

1. National Bank of Pakistan

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Mr. Jahangir Siddiqui

Mr. Jahangir Siddiqui

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

ORGANIZATIONAL STRUCTURE OF JS BANK LIMITED

7 MEMBERS OF BOARD OF DIRECTORS

SENIOR VICE PRESIDENTS

ASSISTANT VICE PRESIDENTS

GRADE III OFFICERS

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

FUNCTIONS OF JS BANK LIMITED

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Short Term Finance

Cash Management Services

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Conventional Nostro and Vostro Accounts

Discounting of Letters of Credit

Buying risks originated by other banks

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Letters of Credit Advising

Letters of Credit Confirmation

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

PROCEDURE TO OPEN AN ACCOUNT

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Online Inter-city Funds Transfer

Return Cheque (outward)

Demand Draft and Pay Order Issuance

Collection Cheque (Local)

Chequebook Issuance (25 leaves)

ATM Card Issuance**

ATM Card Annual Fee Waiver

Prepared By: Ahmad Noor Ud Din

The Islamia University of Bahawalpur (Rahim Yar Khan Campus)

Rupee Current Account

Online Inter-city Funds Transfer

Return Cheque (outward)