2 Bank Alfalah Islamic Banking Internship ReportBank Alfalah Islamic Banking
3 Introduction of Bank Alfalah Islamic Banking The largest Islamic bank in PakistanBAL incorporated on June 21, 1997in 2003: Bank Alfalah Islamic Banking Division started80/270 Islamic Banking branches are based on Sharia laws.Operational workings prescribed by Islamic Sharia advisorsThe objective: Riba free financing
4 Product Lines Musharakah: contractual relationship Mudarabah: PartnershipMurabaha: non-participatory, client on cost-plus basisIjara: Client takes on rent & pays back episodic rentSalam: Contract of advanced payment against delayed delivery goods Istisna: Specific product against particular condition by a manufacturer
6 Competitors Meezan Islamic Bank Dawood Islamic Banking Dubai Islamic Bank, Pakistan LtdEmirates Global Islamic BankingUnion Bank
7 Introduction of Branch This branch is situated in Kabirwala, District KhanewalIt is 12 Km away from KhanewalThis branch belongs to Multan ZoneThe branch has a talented hardworking energetic staffThis branch deals with Islamic products only
11 Hierarchy of MIS dept’t Branch ManagerOperational ManagerIT officer
12 Structure & Function of MIS Department Responsibilities of MIS departmentTo keep all the computers, printers, and ATM machine of the branch operational by providing in time support to the trouble shooting of the IT equipments.To provide support regarding IT operations and also monitor and trouble shoot the LAN (Local Area Network) inside the branch
13 Structure & Function of MIS Department Functions of MIS departmentProvides support to operations department for keeping the LAN, computers and software work smoothlyMaintains automated slip generation system that generates slips on customer demand so that the cash counters are not over loaded and the customers come to counter at their specific token number marked on the slip.
14 Critical AnalysisBank Alfalah Islamic Banking Division sets its goals according to its mission and vision statement.My observations are following:Strong brand recognitionStrong allocation potentialRecognized market existenceFocused business strategyStrong credit ratingLarge (over 5 million accounts)A full service bank
15 SWOT Analysis STRENGTHS: WEAKNESSES: Bank Alfalah Islamic Banking division is financially very strong bank. Following are some of the strengths of the Bank.Alfalah bank is applying the TQM in each of its branch, which is the great achievement. No other bank has this departmentBank Alfalah Islamic is financially strong and has a huge deposit reserve.WEAKNESSES:Lack of branch network as compared to other Islamic banks in PakistanMore job rotationIt is a step behind in using new technology (MIS) as compared to other banks.Most of the employees are overloaded with workslow in the introduction of new services as compare to other Islamic banks in Pakistan i.e. free internet services.
16 SWOT Analysis OPPORTUNITIES: THREATS: Bank can extend its network in other cities of Pakistan.profitability can be increased by making use of new technology (MIS)Ability to introduce new products and services because of the huge capital reserveIt can adopt E-banking and provide credit card facility to its customers.Good financial position creating a good reputation for future advances and huge depositsTHREATS:In certain era of Pakistan people emphasizes more on Islamic mode of banking.Bank is facing intense competition from other Islamic Banks working in PakistanBank is performing very well in the presence of unstable political and economic situation but this uncertainty is a continuous threat for the bankSWOT analysis shows that Bank Alfalah’s strengths are more than its weakness and it has a chance of availing many opportunities.
17 Internal Factor Evaluation Matrix (IFE) Internal StrengthWeightRatingWeighted Score1st largest Islamic Bank of Pakistan in term of deposits0.140.41st largest Islamic Bank of Pakistan0.120.48Improved operational efficiency as compared to past0.043Large Branch network0.080.24BAL IBD Product positioning is very effectivestandard of living0.050.15Stands in the list of Profitable bank in stock exchange0.16Largest number of corporate deals by any bank is Pakistan0.32Attractive Salaries and incentives for employees0.6Overseas Branches0.2Internal WeaknessIn some regions BAL IBD service is not good as compared to others1BAL IBD is a step behind in using new technology as compared to other banks2All branches need orientation for customer dealing with loyalty0.030.06Security system in most of the branches is not up to dateMost of the employees are overload with the work and promotion is also not timelyTotal Weighted Score3.11
18 External Factor Evaluation Matrix (EFE) Key External FactorsWeightsRatingsWeighted ScoreOpportunitiesTerms of Licenses to Islamic banks by SBP0.1440.56Growing acceptance of Islamic banking with lay man0.0420.08Government Patronage0.20.4Refinement of procedures by COIE0.130.3Expansion in different other areas internationally.0.060.12Tide Down of Money0.05Energized Research and Development0.15ThreatsExcessive and expensive documentationComparisons of Rates profits interestSlow and tedious product development processBad Mouthing by conventional Bankers0.110.44Absence of Interbank money market for Islamic Banking0.02High expectation of General PublicTotal12.94
19 TOWS Matrix SWOT STRENGHTS Phenomenal growth in branches External Credit Rating.Enhance Customer services and careCharging moderate rate of return.No specific market nichePersonalized banking servicesSystematic working operationsOffering a generous product portfolioWEAKNESSLack of awareness through publication of Islamic material.Lack of research and development.OPPORTUNITIESGovernment PatronageAcceptance by laymanalteration of proceduresEnergized research and developmentSO STRATEGIESMarket DevelopmentProduct developmentCost Leadership StrategyWO StrategiesStrengthen research and development through industrial supportControl InflationTHREATSExpensive and excessive documentationSTRATEGIESHorizontal IntegrationCost Leadership strategyWT STRATEGIESConcentric diversificationProper Advertisement to enhance awareness
22 Porter’s Five Forces Matrix Degree of RivalryThreat of EntryThe Threat of SubstitutesBuyer PowerSupplier Power
23 Ansoff MatrixMarket Penetration: Selling more of the same to same type of peopleMarket Development: Selling the existing products to new consumersProduct Development: Selling new products to existing customersDiversification: Selling new products to new consumersProductsExistingNewMarketsMarket PenetrationProduct DevelopmentMarket DevelopmentDiversification