1. Internship Report
On
THE BANK of KHYBER
Islamic Banking Branch Chakdara
Adil Nawaz Khan
BBA (Hon’s)
Session 2015 – 2019
INTERNSHIP REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE
REQUIREMENT FOR THE DEGREE OF
BACHELOR OF BUSINESS ADMINISTRATION
TO
DEPARMENT OF COMMERCE AND MANAGEMENT SCIENCE
DEPARMENT OF COMMERCE AND MANAGEMENT SCIENCE
UNIVERSITY OF MALAKAND

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List of Acronyms
1. BoK Bank of Khyber
2. SBP State Bank of Pakistan
3. KP Khyber Pakhtunkhwa
4. ATM Automatic Teller Machine
5. H/O Head Office
6. PLS Profit & Loss Sharing Department
7. FOBC Foreign outwards Bills for collection
8. SDA Special Deposit Account
9. KMS Khyber monthly scheme
10. SDR Security deposit receipt
11. KRTC Khyber Rupee Traveler Cheque
12. LC Letter of Credit
13. L/G Letter of guarantee
14. FBP Foreign Bills Purchased
15. FATR Finance against trust receipt
16. FIM Finance Imported Merchandise
17. KYC Know your customer
18. FCA Financial Conduct Authority

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EXECUTIVE SUMMARY
Bankers mean a person transacting the business of accepting money for purpose of lending
or investment, of deposits of money from the public, repayable on demand or withdraw able by
cheques, drafts or any post saving banks. Bank play with the money of other peoples by taking
money from people at lower interest rate and leading it to investors at a higher rate of interest and
differences between these two interest rates are the bank profit.
Bank of Khyber maintains its position as Pakistan’s premier bank determined to set higher
standards of achievements. It is the major business partner for the Government of Pakistan with
special emphasis on fostering Pakistan’s economic growth through aggressive and balanced
lending policies, technologically oriented products and services offered through its large network
of branches.
The purpose of this report is to the performance activities of the Bank of Khyber Islamic
Banking Branch Chakdara and BoK overall performance and its HR Policies and organizational
structure as well. According to my findings BoK chain of command is chairman BoK is the upper
most position and there are many directors under that chairman then chief executive senior
president then executive vice president and this hierarchy is going to end at non clerical staff.
In this report we analyze different HR Policies of Bank of Khyber including selection of
employees, categories of staff, compensation, promotion, transfer, leave, disciplinary rules and
different penalities related policies of the bank, we have certain findings and recommendation for
that at end of report.

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Contents
Internship Report................................................................................................................................0
List of Acronyms................................................................................................................................1
EXECUTIVE SUMMARY.................................................................................................................2
Chapter – 1.........................................................................................................................................9
1.1 Objective of the study..............................................................................................................9
1.2 Scope of the study ...................................................................................................................9
1.3 Importance of the study............................................................................................................9
1.4 Background of the study ..........................................................................................................9
1.5 Purpose of the study...............................................................................................................10
1.6 Methodology of report ...........................................................................................................10
1.6.1 Primary Data..................................................................................................................10
1.6.2 Secondary Data..............................................................................................................10
Chapter – 2.......................................................................................................................................11
2.1 History of Bank of Khyber...........................................................................................................11
2.2 Vision Statement ...................................................................................................................11
2.3 Mission Statement .................................................................................................................11
2.4 Core Values ..........................................................................................................................12
2.5 Objectives of BoK.................................................................................................................12
2.6 Organizational structure of BoK .............................................................................................12
2.6.1 BoK’s board of directors.................................................................................................13
2.7 Function of BoK....................................................................................................................14
2.7.1 Operation Branch...........................................................................................................14
2.7.2 Micro-Business and Rural Development ..........................................................................14
2.7.3 Investment.....................................................................................................................14
2.7.4 Account and treasury......................................................................................................14
2.7.5 Account department........................................................................................................14
2.7.6 Treasury department.......................................................................................................15
2.7.7 Monitoring and Recovery ...............................................................................................15
2.7.8 Long term projects .........................................................................................................15
2.7.9 Computer department .....................................................................................................15
2.7.10 Foreign Exchange..........................................................................................................15
2.7.11 Public Relation..............................................................................................................15
2.7.12 Credit department..........................................................................................................15

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2.7.13 RRMC/RC....................................................................................................................16
2.7.14 Human resource division................................................................................................16
2.7.15 Establishment department ..............................................................................................17
2.7.15.1 Procedure of establishing new branch.......................................................................17
2.7.15.2 Maintenance of existing branches ............................................................................18
2.7.15.3 Functions of establishment department.....................................................................18
2.7.16 Functions of personnel department.....................................................................................19
2.7.17 Functions of public department..........................................................................................19
2.7.18 Functions of stationary department.....................................................................................20
Chapter – 3.......................................................................................................................................21
3.1 Recruitment Policy ................................................................................................................21
3.2 Objectives.............................................................................................................................21
3.3 Policy and procedure .............................................................................................................21
3.4 Appointment conditions .........................................................................................................22
3.4.1 For experienced bankers .................................................................................................22
3.4.2 For fresh candidates........................................................................................................22
3.4.3 Junior officer and officer grade-III...................................................................................22
3.4.4 Appointment procedure for grade -II and above................................................................22
3.4.5 Appointment procedure for grade -III/ junior officers........................................................22
3.4.6 Appointment in non-officer cadre/ driver and security staff...............................................23
3.5 Terms and conditions of service..............................................................................................23
3.5.1 Probation and confirmation .............................................................................................23
3.5.2 Termination of services...................................................................................................23
3.5.3 Resignation....................................................................................................................24
3.5.4 Transfers........................................................................................................................24
3.5.5 Promotion......................................................................................................................24
3.5.6 Seniority........................................................................................................................24
3.6 Training and Development .....................................................................................................25
3.6.1 Background ...................................................................................................................25
3.6.2 Policy features...............................................................................................................25
3.6.3 Training and Development .................................................................................................25
3.6.4 Objectives......................................................................................................................26
3.6.5 Purpose..........................................................................................................................26
3.7 Assessment of training needs..................................................................................................27

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3.8 Implementation .....................................................................................................................27
3.8.1 Curriculum committee ....................................................................................................27
3.8.2 Course schedule for in-house training ..............................................................................27
3.8.3 Regional focus ...............................................................................................................27
3.8.4 Specialized training ........................................................................................................27
3.8.5 Modularization...............................................................................................................28
3.8.6 Training materials ..........................................................................................................28
3.8.7 Banking diploma exams..................................................................................................28
3.8.8 Teaching methods ..........................................................................................................28
3.9 Evaluation.............................................................................................................................28
3.10 Allowances and fringe benefits ...............................................................................................29
3.10.1 Utilities.......................................................................................................................29
3.10.2 Refreshment charges.......................................................................................................29
3.10.3 Increments.....................................................................................................................29
3.10.4 Grant of honorarium .......................................................................................................29
3.10.5 Disbursement of salaries ................................................................................................29
3.10.6 Conveyance allowance/maintenance allowance................................................................30
3.10.7 Travelling allowance/ daily allowance .............................................................................30
3.10.8 Entitlement of officers for official journey .......................................................................30
3.10.9 Transfer grant ................................................................................................................31
3.10.10 Foreign travel allowance rules .....................................................................................31
3.10.11 House rent allowance..................................................................................................31
3.11 Leave rules........................................................................................................................31
3.11.1 Casual leaves .................................................................................................................31
3.11.2 Earned leaves.................................................................................................................31
3.11.3 Pay during leave on full pay............................................................................................32
3.11.4 Leave without pay ..........................................................................................................32
3.11.5 Maternity leaves.............................................................................................................32
3.11.6 Medical leaves & study leaves.........................................................................................32
3.11.7 Encashment of earned leave.......................................................................................32
3.12 Loans and penalties ...............................................................................................................32
3.12.1 Loan for staff.................................................................................................................32
Chapter – 4.......................................................................................................................................36

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4 Introduction of the branch..........................................................................................................36
4.1. Departments of BoK chakdara................................................................................................36
 Operation Department............................................................................................................36
4.2 Departments in which I worked during my internship ..............................................................36
4.2.1 Accounts department..................................................................................................36
4.2.2 Cash department.........................................................................................................36
4.2.3 Remittances department..............................................................................................37
4.2.4 Credit department.......................................................................................................37
Chapter – 5.......................................................................................................................................39
ADMINISTRATIVE ANALYSIS.....................................................................................................39
5.1 Spaces shortage .................................................................................................................39
5.2 Lack of specializd training..................................................................................................39
5.3 Poor job rotation ................................................................................................................39
5.4 Improper distribution of duties............................................................................................39
5.5 Working setup ...................................................................................................................39
5.6 Political analysis....................................................................................................................39
5.6.1 Internal political environment..........................................................................................39
5.7 SWOT analysis .....................................................................................................................40
5.8 SWOT analysis of bank of khyber ..........................................................................................40
Strength .......................................................................................................................................40
Weakness.....................................................................................................................................41
Opportunities................................................................................................................................41
Threats.........................................................................................................................................42
Chapter – 6.......................................................................................................................................43
CONCLUSION................................................................................................................................43
Chapter – 7.......................................................................................................................................44
RECOMMENDATION ....................................................................................................................44
BIBLIOGRAPHY ............................................................................................................................46

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DEDICATION
“The Holly Prophet Mohammad (PBUH) from where all systems and
standards for quality can be downloaded directly, which are applicable
everywhere; from daily life to the dynamically changing business
environment”.
&
“My Dear parents and Teachers who taught me the true meaning of life”

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ACKNOWLEDGMENT
First of all, I would like to acknowledge “The Allah Almighty”, the supreme authority of
the universe, who has always helped me in all matters of life, I tried but He rewarded me more
than the tried.
This report is a product of hard study; query involves many people’s considerate attention
to it. Without their assistance, suggestion, direction, and co-operation preparation of this report
would have been impossible. So, I want to pay my gratitude to them.
I want to express my gratitude mainly to my supervisor Dr. Rizwan Ullah Lecturer,
Department of Commerce and Management Science, University of Malakand, who helped me
from the very beginning of my internship search for attachment. My honorable supervisor from
time to time give me appointment and suggest me to prepare this report that finally made me
possible to complete this report which is a partial requirement of BBA program.
I also want to acknowledge Dr. Shafiq Ur Rehman Chairman Department of Commerce
and Management Science, Mr. Ishfaq Ahmad Branch Manager, Chakdara branch of The Bank of
Khyber who helped me to manage attachment in this bank. I am indebted to Mr. Ubaid Ullah,
Manager Operations who was the supervisor of my internship program. Then I would like to thank
to Sohail Khan, Manager Credit, who provide me all the required information to make this report
successful and also Mr. Asghar Khan, GBO of BOK who in every step of my internship program
guides me, taught me, provided information and enables me to how banks work.
My special thanks and regard goes to my parents, my brother and my friends whose love
and encouragement is my strength. I am also extremely grateful to my friends and my fellows for
their guidance, help and endless support to me in their silent sincere way.
Adil Nawaz Khan

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Chapter – 1
INTRODUCTION TO REPORT
1.1 Objective of the study
For completing the BBA (Hon’s) degree, each student is required to make an internship
report on a recognized organization. The students are required to work according to their own
field in which they are doing their specialization.
1.2 Scope of the study
Eight weeks are no longer duration to fully understand the overall working environment of
an organization. The internship was done at Bank of Khyber, Main Branch, Chakdara. The study
basically includes area of management, HR department, and to develop the confidence, while
interacting with highly qualified personnel in the bank.
1.3 Importance of the study
Bank play a central and very important role in the economic life of a country, that’s why
they are considered as the lifeblood of modern economy. Today no one can deny the importance
of banking in the economy. They facilitate and expedite trade and commerce and provide a variety
of services that could can’t imagine from banks in past.
1.4 Backgroundof the study
The socio-economic growth of any developing country depends mainly on the health of its
monetary based institutions. The Banking sector is an important industry in today’s world. Banks
are the most important segment of the fast-growing global economy. In Pakistan too, banking is
considered very important. Because banking system plays a key role in the economic development
of a country. Bank is inevitable for making economy stronger, efficient and to make it as good as
internationally
The Bank of Khyber was established through an Act of NWFP assembly called, “The BoK
Act, 1991, “passed in June 1991 the bank was formally launched on November 01, 1991. The
network of its branches is spread all over the country. Now-a-days BOK is playing a vital role in
banking sector especially in Khyber Pakhtunkhwa, so the primary purpose of the study is to
understand the peculiar nature of the Bank. The problems faced by this organization and the

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possible remedial actions, as the study is to find all the facts upon, which analysis of the financial
statements of the organization is to be based.
1.5 Purpose of the study
The primary purpose of this report is to gather relevant information to compile a report on the Bank
of Khyber. Along with this, the second basic purpose is to work in an organization and to compare the
theory and application of management knowledge in real life situation. Another, purpose is to improve
personal skills i.e. human relations and communication skills that are to interview and work with them.
Similarly, the report’s purpose is also to develop analytical skills by analyzing the working environment
and performance of the organization through SWOT analysis. At the end, some recommendations are also
given for the improvement of performance of the Bank.
Apart from this, the internship report is an important and compulsory requirement for the
Bachelor of Business Administration Degree.
1.6 Methodologyof report
The data/ information for the internship report was gathered through different sources i.e
primary as well as secondary, a detail of these is given below
1.6.1 Primary Data
The primary data was collected through interviews from the employees of Chakdara
Branch, discussions with management and staff members, briefings given by mangers,
questionnaire filled by the staff and my personal observation during the internship were the sources
of primary data.
1.6.2 Secondary Data
It was collected from broachers, manuals, annual reports of the Bank of Khyber other
booklets of The Bank of Khyber about the rules and procedures, articles from newspapers and
journals, information on the website of The Bank of Khyber were the sources of secondary data.

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Chapter – 2
INTRODUCTION TO BANK OF KHYBER
2.1 History of Bank of Khyber
The Bank of Khyber (BoK) was established in 1991 under the act of the KP assembly its
objectives included promotion of savings and investment in KP. In 1994 it acquired the status of
a scheduled bank that allowed it to open branches outside KP, become a member of the clearing
house, and engage in trade finance activity. Advantages of scheduling have had a positive impact
on the Bank after adjustments to State Bank of Pakistan (SBP) requirements during 1995.
The bank has a paid up capital of Rs. 750 million out of which Rs. 652.5 million has been
provided by the government of KP, while the remaining Rs. 97.50 million has been contributed by
DEG, a German Development Bank.
BoK is distinguished by the fact that it is not only a commercial bank but it also plays a
role of a development agent, through systematic long-term lending, specially to small and medium
size business. Separate project financing departments namely, long-term projects department and
Micro Finance Unit have been set up for this purpose. BoK has arranged several line of credit
from international agencies for meeting the funding requirements of development projects in KP.
BoK has 169 branches and currently they have 1800 well-qualified officers, and it places
great importance on their profes1sional achievements.
2.2 Vision Statement
To become a Leading Bank providing efficient and dynamic services in both Islamic and
Conventional banking through expanded nationwide network.
2.3 MissionStatement
To increase shareholders’ value and provide excellent service and innovative products to
customers through effective corporate governance, friendly work environment and contributing
towards an equitable socioeconomic growth.

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2.4 Core Values
 Highest quality of service
 Professionalism
 Integrity
 Teamwork
 Innovation and utilization of latest technology
 Risk Mitigation
 Corporate Social Responsibility
2.5 Objectives of BoK
Objectives are the ends towards which activities are aimed. In fact, these are the results to
be achieved. The bank of Khyber has certain objectives, which are as follows;
 To mobilize private savings and public funds for diverting the same into productive
channels and ensure their availability.
 To promote industrial, agricultural and socioeconomic processes through the active
participation of private and public sector in the province.
 Help under develop areas and create employment opportunities, specially in the rural areas
of the province. Further, to guide and assist the people of KP serving overseas to effectively
and profitably invest their foreign savings in the province as well as other parts of Pakistan.
 Create a diversified and sound portfolio for utilization of idle funds and their investment
in the existing and new ventures specially in the pioneering of high-tech agro based export
oriented and engineering projects to ensure maximum returns.
 Participate and seek the share of the province in the capital market of Pakistan by way of
subscription through locally pooled resources in the leading stock exchanges of the country
and eventually paving the way for establishing a stock market in the province.
2.6 Organizational structure of BoK
The Bank of Khyber is one of the modern organizations, it is being managed by a
competent staff. It is a centralized organization and the authority flows from top to bottom.
All the available information about the organization’s management and structured are given in this
chapter. Based on BoK Act, the general superintendence and direction of the affairs and business

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of the bank has been entrusted to the Board of Directors (BOD). The Board of 9 directors
comprising four directors nominated by the government of KPK.
2.6.1 BoK’s board of directors
According to the BoK Act, the Board of directors comprises of nine as follows
 Four directors nominated by the govt.
 One director nominated by the Foreign Equity Holder
 Three directors elected by the shareholders
 The managing Director shall be the ninth director
2.6.2 Management
The day to day operations of the bank are run by a capable team led by Mr. Saif Ul Islam
who is a competent, well qualified and senior banking professional with multi facet experience of
over 40 years. Being a seasoned banker, he possesses impressive leadership skills to manage
employees in various functions and remained strategically involved in many business and
operations transformational ventures.
Besides these, Mr. Saif Ul Islam also remained Nominee Director/Member at 1-Link,
NIFT, Lahore Stock Exchange and PBA (Operations sub-committee). He has done Masters in
Business Administration (Banking & Finance). In addition to academic qualification, he has also
attended various International & Domestic Training & Conferences including Blue Ocean Strategy
organized by INSEAD at Paris in 2009, Branch Banking organized by EUROMONY at Egypt in
2008, Anti-Money Laundering at MUMBAI in 2005 and other seminars / training courses at
LUMS, PIM, NIBAF and IBP. He has also attained professional qualification of DAIBP –
Distinction in Banking Law & Practice.
2.6.3 Head Office
Bank of Khyber has its Head Office. It is situated in Cant, Peshawar. This office is equipped
with latest scientific tool. It has internet software. It provides all the important information. Head
office has two divisions; as given below
 The banking division
 Administrative division
These are further classified for the purpose of administrative convenience. There are also other 2
independent departments.
 Long term projects

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 Audit department
Long term projects handles the invest proposals of huge industrial projects whereas audit
department is meant to have an internal control
2.7 Function of BoK
Since BoK is a commercial bank, it performs a variety of functions. Like other commercial
banks, BoK is engaged in financing international trade. Its other major functions include receiving
deposits, advancing loan and discounting of exchange. The function performed by BoK are
2.7.1 Operation Branch
The branch operation department has direct control on operation of branches. It handles all
these issue that are directly related to the operation of branches e.g.
 Handles all operations and legal issues
 Budget projection
 Test key
2.7.2 Micro-Businessand Rural Development
This department deals specially with the due of cotton industry and small businesses, the
aim of establishment this department was to fulfill the finance need of small businesses in KPK.
This department also provides loans to women development and rural area.
2.7.3 Investment
This is a relatively newly established department. The purpose is to pinpoint the invest
opportunity and to develop investment programs. This department also forecast threat associated
with this opportunity and gives expertise.
2.7.4 Account and treasury
This department keeps entire record relating to accounts. This department as its name
signifies is responsible for handling the account of cash of bank of Khyber.
This department is further divided into two departments
2.7.5 Account department
Account department is responsible for preparing quarterly income statement, cash flow
statement and Balance sheet.

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2.7.6 Treasurydepartment
Treasury department is responsible for managing funds and avoiding chance of misuse of
funds.
2.7.7 Monitoring and Recovery
In strict sense this department is legal hand of bank of Khyber. This department negotiates
all the debts and if its efforts go in vain then they file litigation. This department provides full
assistance to branches in enforcement of actual recoveries of debt through legal process. They
trace borrowers and their assets and servicing of summons.
2.7.8 Long term projects
This department is primarily concerned with long term projects. Its duty is to identify those
long term project that will add significantly to development and progress of KP in particular and
Pakistan in general.
2.7.9 Computer department
No modern organization can be visional without computer. This department is responsible
for computerization of various branches of Bank of Khyber. This department has developed
network software “internet” for the Head office etc.
2.7.10 ForeignExchange
This department is responsible for
 Maintaining FCA
 Dealing in telegraph drafts in foreign currencies
 Facilities of imports and exports to client
2.7.11 Public Relation
This department suggests how to improves relation with the public, how to attract
customers and how to motivate people to invest in bank.
2.7.12 Credit department
Credit department is for large loan sanction. This department handles the request and
proposal of borrowers. This department is responsible for handling the lending activities of the
bank. It provides accounts the terms and conditions to clients. It is responsibility of this department
to accept or reject a proposal.

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2.7.13 RRMC/RC
 Recovery of stuck off loans.
 Negotiate with customer.
 Banking court.
 Mortgages.
2.7.14 Human resource division
Human resource division (HRD) plays a vital role in carving the present and future image
of an organization by managing employees in the most beneficial and effective manner, the
functional area of HRD consists of recruitment, training, performance appraisals, planning and
career development and above all grooming of staff to adhere to office ethics and social norms. At
BoK, they believe that manpower is the most important and precious asset. The HRD tries to create
an environment of mutual trust and dignity and trying hard to pursuit the expression “We rather
than I” so as to ensure best positive results. It is playing a proactive role in capacity building,
experience sharing, strengthening analytical and policymaking, skill up-graduation to help the staff
in their endeavors to make BoK competitive, dynamic and one of the best banks in the country.
HRD provides on the job as well as off-site training to the staff in diverse areas of banking
and management. The training relies on both external courses at institutes of repute in the country
and internally arranged courses. The management is very cautious about the training needs of the
staff and every year a handsome budget is allocated for this purpose, our policy is to provide every
employee at least one opportunity to attend training program in each calendar year.
In addition to above, BoK acknowledges professional acumen, experience and expertise of
its staff through regular financial benefits in the shape of competitive salaries, cash awards,
promotions, academic, sponsorships and other incentives so as to boost their morale for greater
input towards betterment of the bank.

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2.7.15 Establishment department
Establishment is another major section in P&E department; this section is responsible for the
following activities;
 Establishment of new Branches.
 Maintenance of existing Branches.
2.7.15.1 Procedure of establishing new branch
 The management committee decides whether a new branch should be established or not
keeping in view the available developmental funds.
 Establishment section assign the responsibility to prepare the survey report for the
establishment of new branch such as bank name, number of branches capital structure, total
deposits, liquidity position, etc. the part two contain details about new branch, information
regarding the following items.
 Name of the proposed branch.
 Location of the proposed branch or other arrangements.
 Means of communications available at the proposed location.
 Confirmation of the branch location that whether it falls within the municipal town area.
 Names, location and distance of nearest other bank’s branches.
 Population of the area.
HR Division
Establishment
Department
Personnel
Department
PublicRelation
Department
Stationary
Department
Hierarchy of HR Division of BoK

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 The volume and value of agricultural mineral, industrial production, import and export of
area of branch operations.
 Detail of exiting schemes for agriculture mineral or industrial development and their
probable effect on the volume and volume and value of present production, import and
exports.
 Estimate income which the branch exports to earn within three years of its operations,
details of sources such as interest return on advances, communion, funds, placed with head
office.
 Estimating the recurring expenditure for the proposed branch profit/loss anticipated.
 The survey officer submits with the survey reports with SBP. SBP makes the final decision
of granting license for.
 Once license is granted by SBP, establishment of new branch, which involves some of the
following
 Legal contract with the owner of proposed branch building, if any prior arrangements have
been for the location of new branch.
 Purchasing, leasing of necessary equipments (such as computers, fax machines, safes,
lockers) through bidding for new branch.
 Insurance of branch equipment with the approved insurance Companies.
2.7.15.2 Maintenance of existing branches
The Maintenance involves all sort of expenditures which are incurred either for the repair
of capital assets or for conditions to available capital assets, within the exiting branches and bank’s
residences the establishment section premium on issues capital to the concerned branch,
establishment section also handles the vehicles payment of token face and replacement of any part
of the vehicles, office equipment.
2.7.15.3 Functions of establishment department
 Acquisition, Disposal/ replacement of fixed Assets, including vehicles.
 Maintenance, up-keep of equipment/ renovation of fixed Assets.
 Routine visits to Branches, HO Department regarding supervision of maintenance and
branch requirements.
 Negotiation, liaison with suppliers, contractors, Architects and Landlords (lesser).
 Arrangement of premises for branches, HO and execution of lease agreements.

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 Inviting of tenders/ quotations for such job/works/goods.
 Preparation of approval/ sanction notes.
 Obtaining approval from P& W committees for such works/goods.
 Processing/ payments of bills, pertaining to such works/ jobs/ procurements.
 Preparation of capital budget of the bank.
 Supervision of Administrative matters and general Condition/ cleanliness of branches.
 Liaison with branches regarding up-keep, maintenance, Acquisition of such assets &
general condition of Branches.
 Security arrangement i.e. provision of security Guards, Burglar Alarm System etc. to Head
office and branches.
2.7.16 Functions of personnel department
 They are engage in Personnel policy and Recruitment Planning.
 They are concern with promotion and transfers of the employees.
 Give loans, Medical leaves and Disciplinary actions to the employees.
 They give training to the employees.
 They are engage in Human resource Development, Job Rotation, Training, Career
development, Employee Relation, Health Fitness Program
 They arrange board meeting in the organization.
 They also deal internees.
 They forecast future needs and human resource planning.
 They give salaries to the employees.
 They are engage in screening and selection of employees.
 It also gives Post Retirement Benefits to the employees of the bank.
2.7.17 Functions of public department
 Design & launch publicity of the bank of Khyber.
 Arrange high level meetings with Governor/ chief minister/ provincial & federal Ministers
arrange high-level Government officials.
 Accompany the managing director at the meetings as principal staff officer.
 Generate English bulletin on political/ cultural/ social economic news.
 Conduct protocol duties with the visiting dignitaries, delegations & other luminaries.

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 Prepare press release in English & Urdu.
 Keep close liaison with all Pakistani political/social leaders.
 Keep liaison with all the international organizations like UNHCR/
ICRC/UNOCHA/Afghan commissioner ate, KPK, Peshawar too coordinate in relation to
issue of BoK.
 Keep close contract with local industrialists, businessmen & Sarhad
 Chamber of commerce & industry for promoting mutual trade relations.
2.7.18 Functions of stationary department
 Administration and overall supervision of the department as In charge of the Department.
 Putting notes for seeking prior administrative approvals for procurement of printed and
security stationery from purchase committee and after approval; order are placed to printer.
After receipt of respective consignments; payment notes are submitted to purchase
committee.
 Correspondence with HO/Branches/Departments.
 Being the Secretary of Stationary Committee, meeting of the committee are arranged for
making decision with regard to introduction of new items; amendments of existing forms
and pads with consultation and consent of members of committee.
 Rectification of audit objections and removal of any complaint of the Branch/Department
in respect of supply of items at the stationery required.
 Any other matter which management wants to discuss in respect of supply of printed and
security stationery items.

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Chapter – 3
HUMAN RESOURCE POLICES
3.1 Recruitment Policy
Keeping in view the fact that development of any organization cannot be materialized in
absence of comprehensive Human Resource Policies, In line with these objectives and to ensure
combability of staff benefits & developments, the board of directors in its 139 meeting has
revised the existing policy of the Bank, in order to bring it at par with the prevailing industry and
best market practices.
3.2 Objectives
Financial institutions require sound management and a high degree of technical expertise as
well as competence and integrity. Recognizing that the quality of Human Resources will determine
the future of the bank certain objective have been laid down as the cornerstone of our recruitment
policy which are
 That the highest standards of efficiency and integrity be maintained by merit being the sole
criteria for selection.
 That induction of officers be made through a competitive process based on well defined
criteria in line with prevailing practice in the banking industry.
 That regular and permanent induction be made in officer cadre only without clerical and
other non-clerical staff.
 That the bank may pay competitive remuneration in line with other banks, to attract staff
of higher professional caliber, for induction at an appropriate level.
3.3 Policyand procedure
 Appointment shall be made both through direct recruitment and by promotion from lower
posts on merit.
 Appointment to the posts of officers and supporting staff shall be made by the Competent
Authority on the recommendation of selection Committee to be constituted from time to
time.

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3.4 Appointment conditions
All hiring are made on merit basis and for transparency purpose National Testing Service
(NTS) has been engaged in all entry level hiring process.
3.4.1 For experiencedbankers
Graduate with at least three years banking experience. Preference will be given to the
candidates who have passed banking diploma examinations. The above conditions may however
be relaxed by competent Authority on merit of each case.
3.4.2 For fresh candidates
For Officer Grade-II and above candidate must have master’s degree with a minimum of
60% marks from any recognized with preference to MBA, MPA, M.Com. and Economics.
3.4.3 Junior officerand officergrade-III
Candidate must have Graduate/Post Graduate degree from any recognized university.
Suitability of a candidate for the grade shall be determined by the selection committee.
Every candidate must be declared physically fit by a registered medical practitioner
appointed by the bank before entering the service of the bank.
3.4.4 Appointment procedure for grade -II and above
 All the available vacancies for fresh recruitment shall be advertised in the National/CL
newspapers as and when deemed appropriate by the Bank.
 The upper age limit for fresh candidates shall be 28 years. Appropriate age relaxation may
be granted to candidates possessing qualification of Chartered accountant, ICMA or Ph.D.
 A merit list on the basis of marks obtained by each candidate in test and interview shall be
prepared for recruitment.
 The selection committee may relax the requirement of written test in case of candidates
possessing qualifications of Chartered Accountant, ICMA and Ph.D.
3.4.5 Appointment procedure for grade -III/ junior officers
All such appointment shall be made by the selection committee and suitability of a
candidate for the appropriate grade shall be determined by the selection committee.

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3.4.6 Appointment in non-officer cadre/driver and security staff
Appointment to all such posts shall be made by the selection committee on the suitability
and fitness of the candidate, irrespective of educational qualifications.
The nomenclature of the various posts in the Bank shall be as under
 Executive Vice President
 Senior Vice President
 Vice President
 Assistant Vice President
 Officer Grade-I
 Officer Grade-II
 Officer Grade-III
 Junior Officer
 Driver
3.5 Terms and conditions of service
3.5.1 Probation and confirmation
The probationary period in respect of officers and subordinate staff will be one year and
shall be extendable at the discretion of the competent authority. However, in case of officers
recruited on the basis of previous experience, the competent authority may either condone or relax
the probation period up to six months.
In the event of an employee failing to show satisfactory progress during the probation
period, the period of probation may be extended further on his services dispensed with or without
any notice. The probationary period shall automatically stand extended if the bank does not issue
confirmation orders. The managing director or any person duly authorized by him may confirm
the services of an employee.
3.5.2 Termination of services
 The bank may dispense with the service of a permanent employee by giving him/her one
month’s notice or pay in lieu of the notice period. The power to terminate the service of an
employee shall be exercised by the Managing Director or any officer authorized by him.

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Such termination of services of an employee is at the absolute discretion of the bank and it
shall not be entitled to any form of compensation from the bank.
 The bank reserves the right of dismissing an employee without any notice/ assigning
reasons if he is found guilty of misconduct, fraud, breach of trust, or any neglect from duty.
3.5.3 Resignation
A permanent employee shall not resign from the service of bank without giving three
month’s prior notice to the bank in written (one month will be considered of 30 days). Failure to
give such notice shall make the employee liable to pay the bank a sum equal to his three-month’s
salary. The temporary employees shall be required to give one month’s notice to resign his
appointment or to pay the bank a sum equal to one month’s salary.
3.5.4 Transfers
All employees of the bank are liable to be transferred to the Head Office or Branch/office
of the Bank anywhere in Pakistan. In the event of non-compliance by the employee, he shall be
liable to be terminated from the services of the Bank. For transfer employee must complete 3-years
tenure at his/her branch.
3.5.5 Promotion
 Promotions to various posts of officers shall be made on merit and no employee shall have
a claim to be promoted by virtue of seniority alone. In case, any employee in the higher
post shows signs of deterioration, he shall be liable to immediate reversion to the lower
post previously held by him.
 For promotion to the posts for which BoK have define special grading system
 A, B & C
 After every 3 year on basis of grades achieve each year employee get promotion to
next rank.
 If there is C grade in last year the promotion is terminated and again for 3 year he
have to wait for promotion.
3.5.6 Seniority
 For proper administration of cadres/grades, the bank shall cause a seniority list of the
employees to be prepared in January each year and circulated amongst the employees but

26. Page 25 of 46
nothing contained in the seniority list shall be construed to confer any vested right to a
particular seniority in such cadre or grade, as the case may be.
 In the case of direct recruits
 Persons who are selected for appointment earlier by a selection board or committee
shall rank senior to those selected later.
 In the case of departmental promotes
 Employees who are approved on the recommendations of the Promotion
Committee for promotion to the higher grade on an earlier date shall rank senior to
those who are approved on a later date, provided that an employee eligible for
promotion who is inadvertently omitted from consideration in the original reference
and is thus overlooked, when he is subsequently considered and approved for
promotion shall take his seniority with the original batch.
3.6 Training and Development
3.6.1 Background
The bank of Khyber recognizes the need to enhance the productivity, performance and
value of its employees through continued training/education. The bank initiated the preparation of
human resource development policy and plan by keeping in mind these objectives.
3.6.2 Policyfeatures
The salient policy objectives of human resource development program are
 To develop skills that every officer at a minimum is capable and qualified for his/her
current position.
 To offer an orientation course for new employees (General Banking)
 To promote a common culture of the Bank of Khyber.
 To familiarize the new entrants to the services rules of the BoK.
3.6.3 Training and Development
The Bank of Khyber started its operations in 1991 with a staff of 20 officers. Initially the
bank hired experienced staff from other banks who were assigned to the newly opened branches
of the Bank. As the Bank grew and consolidated its operations the need for training is important

27. Page 26 of 46
for both for emerging and current issues, as well as strengthening of basic competencies, began to
be addressed.
In the year 2001, the Bank sent 61 officers for training at external institutes and arranged
training at the Head Office for 67 officers. It may also be noted that training courses of the IBP are
now also being arranged at regional centers.
This year the bank has arranged courses for groups of 20 to 25 participants of the following
important subjects
 Credit Management, Evaluation, Documentation & Recovery.
 Customer service in Banks.
 Applied Accounting.
The Bank of Khyber’s training and development programs aims to improve current and
future employee performance by increasing, through learning, an employee’s ability to perform,
usually by increasing his or her skills and knowledge.
3.6.4 Objectives
Increase Bank’s productivity by
 Improving performance of employees
 Increasing adaptability and flexibility of each employee
 Increasing the level of commitment
 Reducing the employee turnover and absenteeism
3.6.5 Purpose
The major purpose of BoK training section is to remove performance deficiencies, whether
current or anticipated, that are the result of employee’s inability to perform at the desired level and
be more productive.
BoK training plan is also very important because ever changing financial/banking sector
demand flexibility and adaptability in the employees.
Training & development program of the Bank of Khyber is designed in three phases
 Assessment phase
 Implementation phase
 Evaluation phase

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3.7 Assessmentoftraining needs
The assessment of training needs survey is used to gather data on the employee’s perceived
need for training as well as the immediate supervisor’s assessment. The employees name is
recorded for each course where his choice matched of that supervisor.
3.8 Implementation
The implementation phase of training plan involves the actual delivery of training. This
requires resolving issues such as determining course content, scheduling courses, contracting
/assigning instructors, choosing training methods, media and venue. During implementation phase
BoK considered the following steps for ensuring effectiveness of the training.
3.8.1 Curriculum committee
In order to ensure that the course content is relevant, updated, and the course schedule reflects
the needs of the organization, a curriculum committee be set up which will be responsible for the
approval of course schedule and course content as well as serve as the advisory body for training.
3.8.2 Course schedule for in-house training
The courses scheduled have been chosen based on;
 Continuation of the core competencies banking courses in general banking, advances and
foreign exchange.
 Suggestion of external auditor and others.
3.8.3 Regionalfocus
BoK are looking to organize training at regional levels, the concept being that BoK take the
training to the employees rather than bringing the employees to the training, where ever possible,
The regional centers are likely to be Karachi, Lahore, Islamabad, Abbottabad, D.I.Khan and
Mardan. In the connection, BoK will be required to develop trainers locally.
3.8.4 Specializedtraining
As laid out in the career path proposals, it is intended that employees will enter specialized
streams or career paths. They will then be imparted specialized training in their relevant fields to
become specialist in that field. Thus, BoK will have to tailor the training programme to provide
the require specialist training.

29. Page 28 of 46
3.8.5 Modularization
To provide more flexibility and reduce time away from work, the courses have been
modularized. Thus, for example the General banking course may now be delivered in ten modules
of modules BB1through LB4 instead of one, two-week course.
3.8.6 Training materials
The training Materials used must be relevant which the curriculum committee will insure.
Further they must address the skill base at the level of the participants and must be compiled that
any trainer at any location can use them.
3.8.7 Banking diploma exams
The personal Department has been planning to offer some assistance with DAIBP exams since
last year, at the repeated requests of employees.
It is going to be difficult to arrange lectures for all the bank’s staff over a two to three months
period. Therefore, it is planned, that an information packet on the subject will be prepared and
distributed to all interested.
3.8.8 Teaching methods
It is felt that BoK teaching methods needs to be changed from classroom lecture style to a more
participatory workshop approach. Further, BoK plan to work in a way so that least amount of time
is spent away from the job and learning is reinforced with actual on the job training.
3.9 Evaluation
Any training programme undertaken is than evaluated to analyze if objectives are being
achieved and whether or not the benefits justify the cost. Evaluation techniques used could be feed
back surveys of trainees, tests, and results as mirrored through customer comments, profitability,
decrease in Audit Objections, External Audits, Results on industry standard tests such as DAIBP
and comments of the employee’s immediate supervisor. BoK believe that an evaluation survey
method may be the best option for evaluation of the programme and plan to use an evaluation from
which will be designed in due course.

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3.10 Allowances and fringe benefits
The Allowance and other Benefits admissible to the permanent employees of the Bank of
Khyber shall be prescribed by the board and changed/modified from time to tome. The existing
Allowances and benefits of the bank are as under
3.10.1 Utilities
All officers are entitled to utility charges at the rate of 15 % of the basic pay. The charges are
admissible during tours and training within the country/abroad and leave of full pay except extra
ordinary leave.
3.10.2 Refreshment charges
The Officers who are required to sit late in connection with bank’s work or required to attend
the office on closed holidays may be allowed refreshment charges up to Rs. 200/- per day by the
Personnel and Establishment Deptt; on the recommendation of their controlling officers.
3.10.3 Increments
 Annual increments shall be granted to the employees on 1st January each year provided
the work and conduct of the employee concerned is satisfactory and clearance has been
granted by P & E Department.
 The following provisions prescribe the condition in which service counts for
increments in a time scale
 All duty in a post on a timescale and periods leave other than extra-ordinary
leave count for increment in that scale.
 An employee who has rendered at least six months service in a scale shall be
entitled to annual increment on 1st January. However, this condition may be
relaxed in case of officers recruited on the basis of previous experience.
3.10.4 Grant of honorarium
The Managing Director may grant honorarium to an employee from the funds of the Bank as
remuneration for work performed which is occasional in character and is either so laborious or of
such special merit so as to justify a special reward.
3.10.5 Disbursementof salaries
Pay and allowances of the employees will be disbursed on the 25th day of the month. On special
occasions such as Eid-ul-Fitr and Eid-ul-Azha(for Muslim employee) and Christmas (for Christian

31. Page 30 of 46
employees) the Managing Director may authorize advance payment of salaries to the Bank
employees.
The Managing Director may allow any extra facility over and above the entitlement of any
officer of the bank in the interest of Bank’s business or under unavoidable circumstances etc.
3.10.6 Conveyance allowance/maintenanceallowance
All officers not provided with an official transport will be entitled to conveyance allowance
or Motorcycle/ Motorcar Maintenance allowance at the rates and subject to the conditions specified
below
 Conveyance Allowance/ Motorcycle Maintenance Rs. 500.00 per month (for all Allowance
employees).
 Motorcar Maintenance Allowance Rs. 1000.00 per month (for Officers only).
3.10.7 Travelling allowance/daily allowance
Cadre Wise detail of travel allowances
S.No. Cadre PKR Per Month
1 SEVP 75,000
2 EVP 65,000
3 SVP 50,000
4 SVP-I 45,000
5 VP 42,750
6 VP-I 35,000
7 AVP 25,000
8 AVP-I 20,000
9 OG-I 15,000
10 OG-II 10,000
11 OG-III 5,750
12 Junior Officer 4,500
13 Drivers/Qasid 3,750
Note: Special duty allowance allowed to all Incharges has been abolished.
3.10.8 Entitlement of officers for official journey
 All the officers are entitled to travel buy air in economy class both on domestic as well as
international flights subjects to approval of controlling officer & will claim actual fare of
the economy class, the competent authority may allow fare of other class.
 Other employees are entitled to travel by train in economy class or by bus or flying coach.
While traveling by train they are entitled to actual fare of second/economy class & while
traveling by road they are entitled to actual fare of bus/flying coach.

32. Page 31 of 46
3.10.9 Transfer grant
Transfer Grant will be admissible to all the employees at a uniform rate as under once in a
calendar year, unless the transfer is required in the interest of the bank & is not at the personal
request of the employee whereby it may be allowed more than one time a year.
o Employee possessing family = one month salary
o Employee not possessing family = half month salary
3.10.10 Foreigntravel allowance rules
The bank shall generally follow the T.A Rules of the Federal Govt. expect that incidental
charges covering transportation, telephone, entertainment etc shall be admissible at the rate of 20%
of the D.A entitlement to the officers proceeding on officer tour/training abroad.
3.10.11 House rent allowance
All employee not provided with residential accommodation by the Bank are entitled to house
rent allowance at all stations at 70% of the basic pay. This allowance is admissible during the
period of joining time, tour, training and leave on full pay except extra-ordinary leave.
3.11 Leave rules
3.11.1 Casualleaves
An employee will be entitles to 12 days. Casual leave pay in each calendar year. Such leave
will not be carried forward to the following year & will lapse if not availed during the year. The
casual leave will not normally be granted for more then 5 days at a time.
 Casual leave is intended to meet unforeseen Circumstances.
 Casual leave will not be combined with any leave.
3.11.2 Earned leaves
 The entitlement/admissibility of the earned leave to an employee enrolled on the strength
of the BoK shall be whorled out from the date of joining as under
 Earned of 48 days shall be admissible in every calendar year.
 Leave for periods of less than one year will be calculated on prorate basis ignoring
decimal fraction.
 Earned leave of 48 days will be credited only after completing one year of services.
 The earned leave may be accumulated & availed by the employees up to a maximum of
one year in the entire service.

33. Page 32 of 46
3.11.3 Pay during leave on full pay
Pay admissible during leave on full pay shall be the same as drawn in the preceding month
subject to pass.
3.11.4 Leave without pay
Recreation leave
RL may be granted for 7 days outside the leaves account once in a calendar year. Recreation
allowance equal to one basic pay will be admissible to the employees.
3.11.5 Maternity leaves
ML shall be admissible to female officers three (3) times in the entire service. The leave may
be granted to the extent of 90 days in all from the date of the commencement or forty five days
from the date her confinement, which ever be earlier the leaves so granted will be leave on full
pay, but will be first adjusted against the earned leave balance of the employee & the remaining
period will be created as leave on full pay outside the leave account.
3.11.6 Medicalleaves & study leaves
Medical leave and study leave can only be availed with the prior written consent of the
competent authority such leave shall not be claimed as a matter of right & will be decided on the
merit of each case. In case of medical leave an opinion from the bank’s approved medical advisor
may be sought when seen fit by the competent authority. Medical leave or study leave if granted
will be deducted from the earned leave account of the employee on full pay & the remaining
duration treated as leave without pay. 5 days sick leaves are allowed per year.
3.11.7 Encashmentof earned leave
Encashment of earned leave up to six months on full pay shall be admissible to an employee
during the entire services provided he has completed 4 years of service on the date of application.
3.12 Loans and penalties
3.12.1 Loan for staff
The BoK offers the following types of loans to their staff.
1.House building finance
2.Car/motor cycle
3.Personel loans

34. Page 33 of 46
4.Car lease finance
3.12.2 Purpose of staff loan
The basic purpose of staff loans is to relieve their employees or staff members from any
type of problem they are facing regarding their accommodation, connivance or any problem that
is going to hurt their performance while they are on the job.
3.12.3 Total share of staff loan
BoK offers 5% of the total deposits of the year for the staff loans. For example, if the total
deposits for the year are 100,000/- then the staff loan for that year will be 5% of 100,000/- i.e.
5000/-
3.12.4 Procedure for the staff loan
Every November 15 to December 15 a Circular is circulated to all branches of the BoK in
order to make aware all the wishing employees if they want to avail this facility offered by the
Bank to them during this periods. These employees or staff members then forward their
applications to the concerned person in the Personnel Department. These applications are then
checked according to the criteria given for each type of loan, those found eligible, their applications
are accepted according to the set procedure and are forwarded for the due procession.
3.12.5 Criteria and procedure for house building
The criteria and procedure followed for the House Building Finance is as follows;
 The employee applying for this loan should have a length of service of three years.
 The selected employee for the loan will be paid a loan equal to his eighty (80) basics pays.
 This loan will be paid in two equal installments. The first installment will be paid when the
application is accepted and the second installment is given after the property on which the
house is going to be build is Mortgaged with the Bank.
 The length of recovery for this type for loan is twenty years (20) OR 240 installments.
3.12.6 Criteria and procedure for car/motor cycle loan
 The criteria and procedure for this type of loan is followed as;
 The person applying for this loan should have a service period of at least one year.
 The amount of loan payable for the car is one hundred and fifty thousand rupees only.
(150,000/-) with a mark up rate of 8%.
 The amount of loan payable for the motor cycle is forty thousand rupees only (40,000/-).
There is no mark up on these loans; it is free of mark up.

35. Page 34 of 46
 The recovery period for this type of loan is 10 years.
3.12.7 House building enhancement
This type of loan comes into the frame when an employee or staff member who has already
applied for the house building loan and is accepted for that purpose as well and during this course
he either gets Promotion or his salary increases by any special increment so he becomes eligible
for this loan, two things should be checked while giving this loan;
Evaluation of the property, what is the value of the property for which he is asking for this type of
loan? For example, if he the loan available for him is 150,000, then the value of the property should
be round about 170,000/-
Legal opinion must be taken from the lawyers in order to avoid the complications of Audit.
3.12.8 Personal loans
Their criteria and procedure for the Personal loan is that the applicants should have.
 Completed at least one year of his service.
 The applicant is entitled for three basic pays for the loan.
 The rate of markup for this loan is 11%.
 It is payable within three (3) years.
 The employee can avail this loan for three to four times during his/her service.
3.12.9 Car lease
This loan was first started on commercial basis for general public, but due to the consistent
demand of the staff members of the BoK, the higher authorities approved it and the bank started
offering this to its own employees as well.
Lease is an Islamic mode of financing and is in accordance with the statement of the BoK
as well, which states that the bank will develop into a full fledge Islamic bank with the passage of
time.
3.12.10 Criteria and procedure for car lease
The criteria and procedure for the car lease is as follow;
 The employee applying for this should have five (5) years as a length of service.
 He/she will have to pay 10% as a sown payment.
 The markup rate will be 6%.
 He/she will have to pay 3% as an Insurance per annum.
 The vehicle should be newly purchased.

36. Page 35 of 46
 The vehicle should be registered at the name of the bank.
 If the employee has already availed the car loan then it should be adjusted before
disbursement.
 Junior officer, O.G-I, O.GII can avail up to Rs.300, 000/-
 O.G-I and AVP and above can avail up to Ts.700, 000/-
3.13 Disciplinary and general conduct rules
3.13.1 Grounds for penalty
Where an employee of the Bank, in the opinion of the authority
 Is inefficient or has ceased to be efficient; OR
 Is guilty of misconduct; OR
 Is corrupt, or may reasonably be considered corrupt
3.13.2 Penalties
The following are the minor and major penalties, namely
3.13.3 Minor penalties
 Censure
 Withholding, for a specified period, promotion or increment, otherwise than for unfitness
for promotion or financial advancement in accordance with the rules or orders pertaining
to the service or post;
 Recovery from pay of the whole or any part of any pecuniary loss caused to the Bank by
negligence or breach of orders;
3.13.4 Major penalties
 Reduction to a lower post or time-scale, or to a lower stage in a time-scale
 Compulsory retirement;
 Removal from service; and
 Dismissal from service.

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Chapter – 4
BOK CHAKDARA BRANCH
4 Introduction of the branch
BoK Chakdara branch is one of the important branches of BoK it started operation in 2015.
Because it is one of the commercial places, it performs all the functions of the commercial bank,
from deposits to advances, remittances etc. The Chakdara branch of BoK is widely acclaimed as
the busiest branch in the region. The site of the branch is very suitable. The staff of the bank is so
active to deal the clients.
4.1. Departments of BoK chakdara
 Operation Department
 Accounts Department
 Cash & Clearing Department
 Service Quality Department
 Remittances
 Credit Department
4.2 Departments in which I workedduring my internship
The departments in which I worked are,
4.2.1 Accounts department
This department coordinates all the banking activities there by keeping track of each activity in
a sequential manner and provides up-to-date data. The accounts department is also responsible for
proper accounting of assets and liabilities of the branch. This department is the backbone of the
entire banking system. All the banking activities are placed through this channel. Main functions
of this department are
 Maintenance of books of accounts.
 Preparation and disbursement of salaries of bank’s staff
4.2.2 Cash department
Cash department owes its importance to the fact that it is a major point of contract between the
bank and the customer, the bank’s most valued relationships. This department is the showcase of
the bank and conveys the first impressions about the bank’s commitment to professionalism in its

38. Page 37 of 46
system and procedures and to courteous and efficient customer service. This department performs
the function of receipts and payments. Efficient cash management is needed to execute payments,
collect receivables and maintain liquidity.
All the activities of the cash department are divided into two i.e. Cash Collection and Cash
Payment.
4.2.3 Remittances department
Funds transfer facility or remittances of funds are one of the functions of the banks all over the
world. Remittances through banking channels save time, costs less and eliminate the risks involved
in physical transportation of money from one place to another.
Types of remittances
Remittances can broadly be classified as outward and inward remittances.
4.2.3.1 Outward remittance
When a bank instructs another bank/branch to affect a remittance, it is said to be affecting
an outward remittance.
4.2.3.2 Inward remittance
When a bank/branch is itself affecting a payment/ disbursement at the instructions of
another bank/branch, it is said to be handling an inward remittance.
4.2.3.3 Modes of remittances
Different modes and means of remittance are discussed below. BoK transfers money in
the following ways
 Demand Draft (DD)
 Telegraphic Transfer (TT)
 Mail Transfer (MT)
 Pay Order (P/O)
4.2.4 Credit department
The bank is profit- seeking organization. It attracts surplus balance from the customer at low
rate of interest and makes advances at a higher rate of interest to the individual and business firms.
Credit and extensions are the most important activity of all the financial institutions, because it is
the main source of the earning. Credit department is one of the most sensitive and important
department of BoK. About 75% of the profit is usually earned through this department. The job

39. Page 38 of 46
of this department is to make proposals about the loans; the credit management division of HO
directly controls all the advances.

40. Page 39 of 46
Chapter – 5
ADMINISTRATIVE ANALYSIS
5.1 Spaces shortage
It is observed that branches suffer from space shortage. The seating arrangement is not
sufficient as compared to the number of employees and customer.
5.2 Lack of specializd training
In BoK training is provided on basis of generalization rather than specialization. After
completion of training he/she is inducted into a specific field. Due to lack of knowledge he or she
faces difficulty to perform the assigned job.
5.3 Poorjob rotation
Branch officers are not properly rotated. It is noted that an experience banker from Deposit
section doesn’t know about the work of remittance department. So they must be rotated in all the
departments of the banking in order to get familiar with the working of different department in
order to have a knowhow of the whole system.
5.4 Improper distribution of duties
In BoK there is improper distribution of duties and responsibilities. It is being observed
that sometimes an officer of the same grades may have less or more responsibility than another
officer of this grade.
5.5 Working setup
It is observed that there are some deficiencies in the branch setup, which creates extra
disturbance, and excessive movement, which in turn affect the efficiency of employees and thus
that of the whole organization also.
5.6 Politicalanalysis
5.6.1 Internal political environment
5.6.1 Due to lack of systematic reward in personnel and establishment department as a result
employees have low motivation level and high switching rate in some cases.
5.6.2 There is no political pressure for strong coordination between different institutions so
as to lower the cost of employees.
5.6.3 There is lot of political interference in the recruitment system of the bank that results in
inefficient management which in the long run results eventually in bad portfolio.

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5.6.4 Having 71% share of Bank of Khyber provincial government always interfere in regular
operation of bank which has strong impact on efficiency of bank.
5.7 SWOT analysis
SWOT is an acronym for Strength, Weaknesses, Opportunities and Threats. SWOT
analysis is a careful evaluation of an organization’s internal strengths, weaknesses as well as its
environmental/external opportunities and threats.
Strategies for SWOT Analysis
 Exploiting opportunities and strengths.
 Neutralizing its threats
 Avoiding its weaknesses.
SWOT analysis is based on the assumption that if management is careful then it ensures
organizational success. SWOT analysis is an important tool in analyzing the overall situation in
which organization is conducting its business affairs; each issue remains relevant and useful
corporate strategy formulation.
5.8 SWOT analysis of bank of khyber
Strength
1. First bank to start Islamic banking in Pakistan.
2. Provincial government backing and confidence of people due to government bank.
3. It has modern technology and resources.
4. Staff has combination of young and rich in experience and working skill.
5. Officer attractive schemes and more save for customer from time to time.
6. The Bank of Khyber has market confidence in providing products and services to the
customers over the year.
7. Bank of Khyber has the ability to cope with pressure of competition.
8. Bank has the good optional policies and attractive compensation with of the people and it
is also an asset to it.
9. Bank’s management has the motivation to make it best bank of the country.

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Weakness
1. Due overload of work employees of BoK chakdara branch are lacking motivation thus
reducing their efficiency.
2. Communication gap between different levels of management.
3. The lower level management lacks clear direction and is not having the managerial depth.
4. Lack of experienced commercial bankers in the top management positions
5. Lack of modern banking approaches like ATM and commerce on line banking as compared
to other competitors like UBL & HBL
6. Marketing skills of the bank are good but they have little presence at different media.
7. Lack of highly trained resource staff. Increasing trend of bad loans.
8. Lack of modern technology as compared to other competitors computer system at branch
have slower processing speed with poor graphic display and ATM is mostly down due to
traffic on server
9. During my internship air conditions of the bank was also not functional due to which
management team and also customer have to face heat in the branch building.
10. It has been noted that the Bank’s officers usually neglect the rules and regulations either
intentionally or unintentionally, because these have not properly communicated to them.
Their prompt communication must be ensured and the employees must be informed about
the penalties in cases of negligence.
Opportunities
1. Opportunity to open branches in northern areas specially because there is 100% current
deposit.
2. All branches are computerized and connected through intranet system therefore no
difficulty in thinking it into on line banking.
3. Bank should take interest in the new market segments like IT business, software business
etc.
4. Should add new services to its product line.
5. Increasing credit facilities to lower income groups, thus reducing the risk of loss and also
improving the image of the bank.
6. To open a branch in Afghanistan because a majority of afghan citizen are settled in KP and
on monthly basis they have remittances from Afghanistan and to Afghanistan.

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Threats
1. Political, economical situation of the country. Reduction in the business activities in the
country.
2. Deteriorating confidence of people in bank uncertainties of the investors.
3. Modern technology used by other commercial banks.
4. Starting Islamic banking is threats for BoK because if it is flop it will be a big loss for
BoK.
5. Increasing number of private/foreign banks in the country.
6. Reducing the rates of savings in different segments of people.
7. Global technological advancement.
8. Bank Alfalah and other commercial banks is the biggest threat for BoK.
9. Qualified staff working in other banks.
From “SWOT” analysis we can conclude that the management of the bank should adopt
systematic planning for the bank growth, talking with them all management levels of the banks,
discover new segments of the customers, offering schemes for its customers.
Similarly Bank of Khyber has to focus on potential customers and give proper attention to
every customer and their need then it will become one of the leading and comprehensive banks.
Emphasis on present customers by giving them personal Services and targeting the private
potential customers instead of Government deposits at high interest rates. Creeping trend of non-
performing loans.

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Chapter – 6
CONCLUSION
Based on the findings and recommendation made in the previous chapter of the report, the action
plan for scholarship programs to enhance the education and skill of the deserving employees is
given here as under -
6.1 Reasons
1. The BoK has about 1300 employees and most of them are simple graduates.
2. Persons holding degrees of foreign universities are not keen and willing to join the BoK. They
are always trying to join the multinational companies or foreign banks.
6.2 Remedies
The following remedies are suggested to cope with the situation.
 The BoK should stress on education and experience.
 The BoK should constantly give incentives and opportunities to its employees to enhance
and improve their education profile.
For this purpose the best option, which the BoK can avail, is to started scholarship program for
its employees to study in country’s best universities or aboard to get degree of MBA or MBA-
banking and finance and PhD etc.

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Chapter – 7
RECOMMENDATION
The following findings and recommendations are based on personal observations and
analysis. The given recommendations will help to cope the problems being faced by the bank and
will enhance the efficiency and performance of the Bank of Khyber.
7.1 Space shortage
During my internship in Chakdara Branch I observed that there is shortage of space at
branch. There is no proper and easy seating arrangement for the customers. To overcome this
problem, the bank either may hire the adjacent building or simply can shift to some other place.
7.2 Better training programs
It has been noticed that the training program of BoK is not adequate. Special marketing
training should be given to employees for motivating customers. The training program of bank
should include scientific techniques to improve decision making and interpersonal as well as
individual needs of an employee.
7.3 Decentralization
Some authority and responsibility should be delegated to the lower grade staff as well so
that they should also consider themselves important and responsible. This will also be motivating
factor for them and results in greater efficiency.
7.4 Proper checking
There is no proper checking system on the entrance of bank. For safety purposes, there
should more security measures, besides special checking instruments at the main entrance.
7.5 Better communication
The management of BoK should concentrate on improving upward communication so as
to have better feedback system involvement in the bank operation.
7.6 Meritorious recruitment
Appointment in the bank should be strictly on merit basis with no other favor given to any
candidates.
In the BoK connection play an important role in recruitment decisions. Recruitment should
be based on relevant qualification and experience particularly in the field of business
administration, financial management, and computerization and marketing expert through
competition, which will ultimately attract better competent employees in the bank.

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7.7 Marketing visits
A very useful mode of conduct is personal market visit. Such visits should be properly
planned with regularly.
7.9 Shortage of employees
Shortage of employees increases the workload on existing employees and ultimately
reduces the output and motivation level of employees. To overcome this problem job description
should be revised and grouped together in order to create new jobs.
Recruitment should be done in order to fill up these new vacancies. In this way the
workload on employees will be reduced, operations will be stream lined and employees will feel
comfortable in performing their duties more effectively.
7.10 Friendlier environment
Friendlier environment should be created because it will help to gain the interest of
employees in work. Noise in the office should be reduced because it has unfavorable impact on
the working environment. Separate place or section should be created for each separate task and
more space should be provided. It would also be of greater help in establishment of friendly
environment.
7.11 Enhanced customer services
Constant improvement in customer services are needed in today’s competitive
environment. Personalized banking should be introduced to attract more customers. Equal respect
should be given to all customers.
7.12 International banking
BoK should expand its branches, not only in Pakistan but also outside the country now.
7.13 Latest computer equipments
Latest software should be introduced in the bank so that the data processing speed of the
computer can be enhanced.
7.14 Customer care counter
Customer’s satisfaction is the key to success. They need proper attention. The Head office
is understaffed and employees are over loaded, it creates more problems for them when customers
disturb and interrupt them while working. Therefore, for the benefit of customers and smooth
working of bank, there should be a customer care counter to guide and help the customers.

47. Page 46 of 46
BIBLIOGRAPHY
 The Bank of Khyber, personal and Administration Department Manual, 2016.
 The Bank of Khyber, Recruitment policy 2016.
 The Bank of Khyber, Information Memorandum 1998
 NWFP Act No. XIV. (1991)
 Koontz, Harold. (1993) Management in Global Perspective; New York; McGraw
Hills, Inc., 10th Edition,
 Personal working during internship period.
 http://www. BoK.com.pk/
 http://www.wikipedia.com/
 Consulate General of Switzerland, (2011), Pakistan Banking sector, Karachi
 Bank of Khyber information memorandum. (2009). Information Memorandum
Peshawar
 Bank of Khyber (2018). Annual Report. Peshawar
 Bank of Khyber (2017). Annual Report. Peshawar
 Internship Report of Mehran Ali Shah (2011-2015)
 Internship Report of Iftikhar Khan (2013-2018)