ANUM ASHRAF

M06BBA004
Presentation Overview

• Corporate and commercial banking

• Swot analysis
• Recommendation
• Conclusion
Corporate and Commercial Banking
 Types of Customers
Corporate Annual Sales=Rs.300M to 800M
banking Requirement=up to Rs. 150M
Customers

Commercial
Annual sales= up to Rs.300M
banking
Customers Requirement = up to Rs. 150M

SME Customers Annual sales =up to Rs.300M

Requirement = up to Rs. 75M
Areas covered for financing

Working
Capital
Finance

Project
Finance

Islamic Trade
Export Related
Refinance Services
Working Capital Finance Solution

Modes of
Financing

Murabaha Istisna
 Murabaha
“ A sale where seller expressly mentions the cost of
commodity purchased”
Application:
1. Purchase of raw material; for meeting working capital
needs of trade and industry.
2.Medium to long term requirements for purchase of land,
building and equipment.
3.Trade finance products including imports, exports and
bill purchase.
 Process Flow
Bank Agreement to Murabaha Client

Agency
Agreement
Disbursement to the agent or supplier

Supplier
Payment of Price
Bank Client
 Istisna
“Istisna’a is a sale transaction where a commodity is
transacted before it comes into existence.”
Application:
1. Ideally suited for catering financing needs of a manufacturing
concern.
2. Short term liquidity management requirement of the customer.
3. It can also be used for financing construction of Houses,
buildings and factories.
4. Istisna’ may also be used for similar projects like installation of
an air conditioner plant in the client’s factory, building a bridge
or a highway.
 Process flow
Bank
Order to
Manufacture

Client
Bank
Delivery of Manufactured
Asset to Bank

Market
Bank
Sale of Asset in
the Market
 Project Financing, Expansion or BMR
Requirement Solutions

Modes of
Financing

Diminishing
Musharakah Ijarah
 Application
Diminishing Musharakah Ijarah

Ijarah is commonly used for

Diminishing Musharakah is
long and medium term fixed
most commonly used for the
asset financing, project
financing of fixed assets,
financing and for retail
projects, homes and
products such as homes and
automobiles.
automobiles.
Islamic Export
Refinance
Trade related services
Bid Bonds
Letters of Performance Bonds
Guarantee Payment Bonds
Retention Bonds

 Export Bills for Collection

Products  Export (Sight) bills
for purchase
 Export (Usance) bills
Exporters
purchase

Products
Sight Letter of Credit
for Usance Letter of Credit
Importers
SWOT ANALYSIS

Strengths Weaknesses

Opportunities Threats
 Strengths
1. First Exclusive Islamic bank with largest network of 201
branches in 54 cities.
2. Strong growth of its Islamic banking strategic business unit
3. International repute of Shariah Board
4. Online banking facility
5. Best Islamic bank award
6. Dedicated and professional staff
7. Healthy working environment
8. Strong share-holding
9. Short term rating A-1
10. Al-Meezan Investments
 Weaknesses
1. Higher charges for different activities
2. Lack of promotion and advertising
3. Lengthy and extensive documentation
4. Weak marketing strategy. Target market not identified
5. Risk averse policy
6. True Islamic procedures are not adopted
7. No credit card policy
8. No aggressivness
 OPPORTUNITIES
1. House Financing sector can be targeted to maximize the profit.
2. Growing demand of Islamic financial products and services.
3. Venturing into Islamic groups outside the country as
opportunity to expand business in UAE and Gulf states
4. Entering into business with other Islamic Financial
Institutions.
5. Increasing Branch network within the country.
6. Providing true Shariah compliant products to customers not
only in words but also in practice.
7. Adopting other Shariah compliant modes of financing.
 THREATS
1. New competitors setting up their Islamic banking
branches
2. High interest rate from SBP
3. Fears on the credibility of Islamic banking ethical
compliance and monitoring system.
4. Disassociation of Maulana Taqi Usmani from the
Shariah advisory board of Meezan Bank
 Recommendations
I • Innovation
• Market perception
M
• Prudence
P
• Relationship management
R
• Objectivity
O
• Vision
V
• Identifying and understanding customer
I needs
• Satisfying customer needs
S
• Educating the customers
E
CONCLUSION