Contents of Discussion (Cont..)• Competitors• SWOT Analysis• Achievements
Mission StatementTo be recognized as the leadingfinancial institution of Pakistanand dynamic international bank inthe emerging markets, providingour customers with a premium setof innovative product andservices, and granting superiorvalue to our stakeholders,shareholders, customers andemployees.
INTRODUCTION HBL establish itself in the Quaid’s city (Karachi) on 8 August 1947. Habib Bank Group is leader in Pakistan’s Service Industry. Extensive network of 1501 branches spread over 26 countries. It was Privatized during the start of 21st century in 2004. Pioneer in providing innovative services such as: First installation of mainframe computer in Pakistan. Followed by ATM service and Internet Banking facilities.
History Young boy “Ismail Habib” reached Bombay in search of job. Got job in utensils and non-ferrous metals. Intelligent and keen to his work & selected as President of the market. Expanded business and engaged in Private Banking.
Level of Management & Board ofDirectors President & CEO: Mr. Zakir Mehmood Board of Directors Mr. Zakir Mehmood (President & CEO) Mr. Sultan Ali Allana (Chairman)
Level of Management & Board ofDirectors Mr. Ahmed Jawad Mr. Sajid Zahid Mr. Sikandar Mustafa
Level of Management & Board ofDirectors Mr. Mushtaq Malik Mr. Moez Jamal
ENVIRONMENTAL CHALLENGES • A broad view of market is important when management is interested in introducing better services for customers. Factors that influence buyers and thus change the size and composition of market overtime involves initially building customer profiles. These influences include: • Political and Legal Environment • Economic Trends • Socio Cultural Environment • Technological Factors • Terrorism (Latest)
POLITICAL AND LEGAL ENVIRONMENT• Banks are strongly affected by the political and legal considerations.• This environment is composed of regulatory agencies and government law that influence and limit various organizations and individuals.• Mostly these laws create new opportunities for business.• Business legislations has following purposes: To protect banking companies from unfair competition. To protect consumers from unfair business practices adopted by banking companies To protect the interest of the society from unbridled business behavior.
Economic Trends• A banking market requires better consumer market in volume along with higher borrowing power. The available borrowing power depends on: Consumer Income Saving rates Consumption Patrons Rates of Interest Budget Deficit Exchange rates Cost of living Inflation
SOCIO-CULTURAL ENVIROMENT• A society is shaped by beliefs, norms and values. People in a society consciously and unconsciously interact with: Themselves Others Organization Society Nature
TECHNOLOGICAL FACTORS– The rate of change of technology has greatly affected the rate of growth of economy.– New technology is creating deep rooted affects which could be observed in long run.– The improvement techniques involved in on line banking.
TERRORISM – It truly destroys the ongoing of an organization, and hence makes it difficult to achieve the desired objectives or goals of the company. – In Pakistan, the economy of the country collapsed because of the terrorist activities in the past few years, especially in the most affected areas like of Khyber PakhtunKhuwa (KPK) and in the present days, KARACHI – Due to terrorism not only HBL or Banks only but all the business sector of the country is affected
PRODUCTS• Following are some of the products and services that are provided by the HBL Products:• HBL Muhafiz Rupee Travelers’ Cheque• HBL Auto Finance• HBL Flexi Loans for salaried personnel• HBL Lifestyles’ Financing Scheme• HBL i-Card• HBL House Financing Loans• HBL Fast Transfer• Haryali Agricultural Loans• HBL E-Bank• Money club account• Id account
RETAIL BANKING RETAIL BANKING– Core strenght of HBL with 1425 branches– Provides diversified low cost deposit base– Formed basis for corporate and investment banking and treasury activities
COMMERCIAL BANKING COMMERCIAL BANKING • On November 1, 2000 Commercial Banking came into being providing two- fold objective of setting up Commercial banking: – First to stop the erosion of market share in the middle market. – Second, to regain the lost market share
CORPORATE BANKING• CORPORATE BANKING – This group serves large institutional customers who require sophisticated products in an environment of intense competition – This Group is now recognized as a market leader – & participates in most large structured finance deals• INTERNATIONAL OPERATIONS First international branch was opened in 1951 in Colombo-Sri Lanka: – The Bank’s branches in financial centers continue to provide efficient trade settlement . – Also provide services to the entire network and business with other banks
Assets NOTE 2010 2009 (IN RUPEES)• Cash and balances with treasury banks 5 81,640,246 79,839,836• Balances with other banks 6 37,413,185 40,366,687• Lending’s to financial institutions 7 30,339,344 5,352,873• Investments 8 254,909,116 216,467,523• Advances 9 459,750,012 454,662,499 Operating fixed assets 10 16,155,290 16,766,668• Deferred tax asset 11 9,572,203 9,205,944• Other assets 12 34,920,007 41,262,754• TOTAL 924,699,403 863,924,793
SharesTotal number of share holders= 113,506.Total Shares=1,001,880,000 (More than 1 Billion).Each Share of HBL= Rs.5.Cost of per share in market= Rs.120.It has a domestic market share of over (40%). Italso continues to dominate the commercialbanking sector with a major market share ininward forward remittances (55%) and loans tosmall industries, traders and farmers.
SPONSORS OF HBLThe following two are the main sponsors of HBL:• Agha Khan Group (The biggest sponsor of HBL (Habib Bank Limited) with the most share i-e 51%).• Government and General Public (with 49%).
COMPETITORS OF HBL• NBA (National Bank Limited).• UBL (United Bank Limited).• MCB (Muslim Commercial Bank).• Allied Bank.• Standard Chartered.• Bank Alfalah.
•Goodwill & historical background. •Union and Conflicts•Professional and well trained staff. •Checking System•Largest customer base. •Weak marketing policies.•Largest commercial bank. •Nepotism & Favorism.•1501 branches World wide •Infected portfolio still exists as bad•20% share in financial market. debts.•Large Balance sheet size. •Centralized management in•Decentralized authority. particular areas. Strength Weaknesses Threats Opportunities•Adverse & unstable government • For growth and expansion in policies. cash management.•Political instability. •Faster market growth•Advance technology. •Restoration of investors’ confidence•Competition from other banks. •Large deposit base and funds flow
ACHIEVEMENTS IN 2008• Deposit growth for the year has been 12.5%• Net asset growth of the bank has been 19% over 2007.• HBL’s consolidated Pre-tax profit for 2008 is Rs. 22.03 billion.• Profit after tax is Rs. 15.61 billion, which translates into an earning per share of Rs. 20.47.
ACHIEVEMENTS IN 2009• Deposit growth for the year has been 14.3%.• Net asset growth of the bank has been 27.2% over 2008.• HBL’s consolidated Pre-tax profit for 2009 is Rs. 21.4 billion.• The profit after tax is Rs. 13.4 billion, which translates into an earning per share of Rs. 14.70.• The Bank announced a final cash dividend of Rs. 6.00 per share (60%) and bonus shares of 10%.
ACHIEVEMENTS IN 2010• Deposit growth has been Rs. 16.8 billion, total assets have grown by Rs. 11.5 billion.• Net assets by Rs. 1.9 billion.• HBLs consolidated Pre-tax profit for 2010 is Rs. 12.8 billion.• The profit after tax is Rs. 7.9 billion, which translates into an earning per share of Rs. 7.70 showing increase of 26% over June 2009.
ACHIEVEMENTS IN 2011 Deposit has registered remarkable growth of 25%. Net asset growth of the bank has been 14% over 2010. HBL’s consolidated Pre-tax profit for 2011 is Rs.34 billion. Profit after tax is Rs. 22 billion, which translates into an earning per share of Rs. 20.13. The Bank announced a final cash dividend of Rs. 4 per share (40%) and 1 bonus shares for every 10 shares held (10%), which is in addition to the interim dividend of Rs. 3 per share.