The 2011 Annual Report of Allied Bank Limited provides an overview of the bank's performance for the year. It discusses the bank's vision, mission, core values, board of directors, management team, and financial highlights for 2011. The Chairman's Message notes that despite challenges, the bank maintained its focus on clients and continued progress by delivering value-added services.
2. Contents
02 Vision Unconsolidated Financial Consolidated Financial
04 Mission
06 Core Values
Statements of Allied Bank Statements of Allied Bank
10 Company Information Limited Limited and its Subsidiary
12 Board of Directors
73 Auditors’ Report to the Members 164 Directors’ Report on Consolidated Financial
14 Profiles of the Directors
74 Statement of Financial Position Statements
18 Board Committees
75 Profit and Loss Account 165 Auditors’ Report to the Members
20 Chairman’s Message
76 Statement of Comprehensive Income 166 Statement of Financial Position
22 Directors’ Report
77 Statement of Cash Flows 167 Profit and Loss Account
28 The Management
78 Statement of Changes in Equity 168 Statement of Comprehensive Income
32 Org-Structure
79 Notes to the Financial Statements 169 Statement of Cash Flows
34 Chief Executive Officer’s Review
147 Annexures I 170 Statement of Changes in Equity
47 Entity Ratings of the Bank
157 Annexures II 171 Notes to the Financial Statements
48 Performance Highlights
159 Annexures III 239 Annexure II
52 Horizontal Analysis
241 Pattern of Shareholding
54 Vertical Analysis
247 Form of Proxy
56 Statement of Value Addition
57 Concentration & Maturity Profile
58 Product & Services
60 Corporate Social Responsibility
64 Notice of 66th Annual General Meeting
66 Statement of Compliance with Code of
Corporate Governance (CCG)
67 Statement of Ethics and Business Practices
69 Statement of Internal Controls
70 Auditors’ Review Report to the Members on
Statement of Compliance with CCG
3. Annual Report of Allied Bank Limited for the year 2011
Performance 2011
1
4. Vision
To become a dynamic and
efficient bank providing
integrated solutions in order to
be the first choice bank for the
customers.
2
6. Mission
• To provide value added services to
our customers
• To provide high tech innovative
solutions to meet customers’
requirements
• To create sustainable value through
growth, efficiency and diversity for
all stakeholders
• To provide a challenging work
environment and reward dedicated
team members according to their
abilities and performance
• To play a proactive role in
contributing towards the society
4
11. Annual Report of Allied Bank Limited for the year 2011
Core Values
• High Performance
• Innovation and Growth
9
12. Company Information
Board of Directors Audit Committee Legal Adviser
Mohammad Naeem Mukhtar Mubashir A. Akhtar Haidermota and Company,
Chairman / Non Executive Director Chairman Barrister-at-Law & Corporate Counsellors
Sheikh Mukhtar Ahmad Pervaiz Iqbal Butt Shares Registrar
Non Executive Director Member
Technology Trade (Pvt.) Ltd.
Muhammad Waseem Mukhtar A. Akbar Sharifzada
Non Executive Director Member Registered Office
Abdul Aziz Khan Sheikh Jalees Ahmed 8-Kashmir / Egerton Road,
Independent Director
Member Lahore - 54000
Pakistan
Mubashir A. Akhtar
Company Secretary UAN: (92 42) 111-110-110
Independent Director
Muhammad Raffat
Pervaiz Iqbal Butt Head Office
Independent Director Auditors
3-4 Tipu Block, Main Boulevard
A. Akbar Sharifzada Ernst & Young Ford Rhodes New Garden Town
(Government Nominee Director) Lahore - Pakistan
Sidat Hyder
Sheikh Jalees Ahmed Chartered Accountants (92 42) 35880043
Executive Director
KPMG Taseer Hadi & Co. Website & Email
Khalid A. Sherwani Chartered Accountants
Chief Executive Officer www.abl.com
info@abl.com
Toll Free Number
0800-22522
10
15. Annual Report of Allied Bank Limited for the year 2011
(Left to Right) Mubashir A. Akhtar
Sheikh Jalees Ahmed
Khalid A. Sherwani
Mohammad Naeem Mukhtar
Sheikh Mukhtar Ahmad
Muhammad Waseem Mukhtar
Abdul Aziz Khan
Pervaiz Iqbal Butt
A. Akbar Sharifzada
13
16. Profiles of the Directors
Mohammad Naeem Mukhtar Sheikh Mukhtar Ahmad Muhammad Waseem Mukhtar
Chairman / Non Executive Director Non Executive Director Non Executive Director
He is on the Board of Allied Bank since He started his business career He holds a Master’s degree in Total
2004. He has done his MBA from Cardiff immediately after migrating from Quality Management (TQM) from
Business School U.K, Post Graduate India at the time of Independence of University of Glamorgan, Wales, UK and
diploma in Textiles from UK and Chartered Pakistan in 1947 and contributed to the has diversified 14 years of experience of
Textile Engineer (CText ATI) from The
industrial and business growth of Pakistan Finance, IT and Industry. His proactive
Textile Institute in Manchester U.K. He
through his entrepreneurship skills strategic guidance played a vital role in
has 26 years of experience of finance and
and business acumen. He has over 50 technological up-gradation to enhance
industry. Besides Chairman of Board of
years of experience in establishing and service quality across Allied Bank. He
Directors of Allied Bank, he is also CEO of
Ibrahim Fibres Limited, Director of Ibrahim successfully managing various industrial joined Allied Bank’s Board in 2004 and
Agencies (Pvt) Limited, Director Pakistan and financial companies. Under his is a “Certified Director” after completing
Business Council and Member Board auspices, Ibrahim Group has emerged as Board Development Series Certificate
of Governors of National Management a leading conglomerate of the country. Program from Pakistan Institute of
Foundation, the parent body of Lahore He has completed Corporate Governance Corporate Governance. He also holds
University of Management Sciences Leadership Skills Program from Pakistan Directorships in Ibrahim Fibres Limited,
(LUMS). Institute of Corporate Governance and is a Ibrahim Agencies (Pvt) Limited, ABL Asset
“Certified Director”. He joined the Board of Management Company Limited and
Allied Bank in 2005 and is also Chairman/ Arabian Seacountry Club.
CEO of Ibrahim Agencies (Pvt) Limited,
Chairman of Ibrahim Fibres Limited and
ABL Asset Management Company Limited.
14
17. Annual Report of Allied Bank Limited for the year 2011
Abdul Aziz Khan Mubashir A. Akhtar Pervaiz Iqbal Butt
Independent Director Independent Director Independent Director
He has enriched and diversified He is a law graduate and has about 45 He is an Electrical Engineer and has 42
experience of over 48 years in local and years of banking experience in local years of experience in marine engineering
international banking. His international and international markets. His extensive and other heavy Industries. His extensive
banking experience is in diverse financial international banking experience includes and diversified exposure of Industrial
markets, including Switzerland. He has key assignments in Turkey, Oman and Management effectively complements
been on the Board of Allied Bank since UK. He is a Financial Consultant of Asian the decision making process at the
2004. Development Bank (ADB) and remained Board level. He has completed Board
actively involved in various assignments Development Series Certificate Program
of ADB especially on capital markets from Pakistan Institute of Corporate
development and reforms of NBFIs Governance and is a “Certified Director”.
in Pakistan. He has completed Board He Joined the Board of Allied Bank in
Development Series Certificate Program 2007 and is also Director/CEO of Polytek
from Pakistan Institute of Corporate Associates (Pvt) Limited.
Governance and is a “Certified Director”
and has been on the Board of Allied Bank
since 2006.
15
18. Profiles of the Directors
A. Akbar Sharifzada Sheikh Jalees Ahmed Khalid A. Sherwani
Government Nominee Director Executive Director Chief Executive Officer
A Joint Secretary placed as Special He joined Allied Bank’s Board in 2004 A seasoned banker with strategic
Assistant to the Finance Minister, Akbar and has more than 36 years of diverse leadership experience of over 40 years
Sharifzada has 25 years of civil service experience in the fields of Financial of banking operations, marketing,
career in Pakistan. He has been posted and Industrial management. He has finance and information technology,
in different Ministries gaining wide completed Board Development Series Khalid Sherwani has been appointed
ranging administrative and policy making Certificate Program from Pakistan Chief Executive of Allied Bank Limited
experience, enhanced by multiple Institute of Corporate Governance and is for the second time in June 2010. His
exposure to specific courses attended a “Certified Director”. Allied Bank benefits exceptional track record includes
within the country and abroad. His from his professional expertise particularly restructuring and turning around UBL
academic qualification is M.A. (English in the areas of strategic and financial during 1996-2000, restructuring and
Literature) and M.A. (Economics). planning, systems and controls and HR recapitalization of Allied Bank Limited
management. during 2000-04 and leading its
He has been appointed as Government
turnaround during 2004-07.
nominee director on the Board of Allied
Bank since January 2012. Khalid Sherwani holds M.Sc. degree and
has also completed Board Development
Series Certificate Program from Pakistan
Institute of Corporate Governance and is
a “Certified Director”.
Besides CEO of Allied Bank Limited he is
also on the Board of First Women Bank
Limited; Habib Allied International Bank,
U.K; ABL Asset Management Company
Limited and 1 Link (Guarantee) Limited.
16
19. Annual Report of Allied Bank Limited for the year 2011
aspiring...
to go beyond
17
20. Board Committees
Audit Committee Terms of Reference
Constitution: Primary responsibilities of the Audit Committee are to determine
appropriateness of measures taken by the management to safeguard
Mubashir A. Akhtar
Chairman
Bank’s assets, ensure consistency of accounting policies, review financial
statements and recommend appointment of the external auditors and
Pervaiz Iqbal Butt
Member
close coordination with them to fulfill statutory and Code of Corporate
Governance requirements. The Committee is inter-alia responsible to
A. Akbar Sharifzada
Member
ascertain the effectiveness of the Internal Control System including
financial and operational controls, ensuring adequate and effective
Sheikh Jalees Ahmed accounting and reporting structure and monitoring compliance with the
Member
best practices of the corporate governance. The other functions of the
Committee include assurance that an independent and effective internal
audit function is in place.
Risk Management Committee Terms of Reference
Constitution: The primary functions of Board Risk Management Committee are the
monitoring of management’s adherence to prudent and sound risk policies,
Sheikh Mukhtar Ahmad assessing the ever changing risk profile and providing risk appetite to
Chairman
the business units. It also ensures development of risk management
Muhammad Waseem Mukhtar principles to build stakeholders confidence, safeguard and enhance Bank’s
Member
reputation. The Committee also monitors quality of asset portfolio and
Abdul Aziz Khan suggest measures to keep the infected portfolio at the minimum level.
Member
The Committee approves risk limits for credit, market and operational
Khalid A. Sherwani risks, credit approval grid and proposals regarding rescheduling/write-offs
Member above certain limits. Overseeing of certain management committees and
groups is also undertaken by the Committee. The Committee also monitors
the initiatives pertaining to Basel requirements and up gradation of risk
management systems.
e-Vision Committee Terms of Reference
Constitution: One of the key missions of the e-Vision Committee is to provide strategic
direction for e-banking and adoption of evolving technologies. Review of
Mohammad Naeem Mukhtar strategic plans to improve IT infrastructure and automation of processes
Chairman
and systems including alternate delivery channels are also in the scope
Muhammad Waseem Mukhtar of the responsibilities of the e-Vision Committee. The Committee provides
Member
assistance to the Board with insights regarding adoption of international
Mubashir A. Akhtar developments in the field of e-banking, keeping in view the domestic
Member
requirements. It also oversees performance of IT Steering Committee,
Khalid A. Sherwani Information Technology Group and Business Systems and Implementation
Member Group.
18
21. Annual Report of Allied Bank Limited for the year 2011
Strategic Planning & Monitoring Terms of Reference
Committee
The Strategic Planning and Monitoring Committee is responsible to review
Constitution: long term strategic plan, operational plan and budget of the Bank before
their consideration by the Board. The Committee also monitors progress
Muhammad Waseem Mukhtar
Chairman against above referred plans and budget and is also responsible to approve
capital expenditure over Rs. 10 Million and donations of over Rs. 1 Million
Sheikh Jalees Ahmed
Member to Rs. 10 Million. The Committee also assists the Board on corporate
development activities and new initiatives including acquisitions, mergers,
Abdul Aziz Khan
Member alliances, joint ventures and divestitures etc.
Khalid A. Sherwani
Member Besides overseeing certain management committees and groups, the
Committee also approves filing of legal suits and criminal complaints
involving significant amounts.
Human Capital Committee Terms of Reference
Constitution: The Human Capital Committee defines the organizational structure and
functional responsibilities of each group and approves staff strength,
Abdul Aziz Khan
Chairman
key appointments, salary revisions, bonuses and special allowances. The
Committee nominates the management personnel on the boards of other
Muhammad Waseem Mukhtar
Member
companies / subsidiaries and also recommends amendments in Human
Resources Policy to the Board, besides monitoring performance of Human
Pervaiz Iqbal Butt
Member
Resources Group.
Khalid A. Sherwani
Member
Board of Directors and Board’s Committees Attendance during 2011
Strategic
Risk Planning & Human
Name Board Of Audit Management Monitoring e-Vision Capital
Directors Committee Committee Committee Committee Committee
Mohammad Naeem Mukhtar **6/7 * * * 7/7 *
Sheikh Mukhtar Ahmad **5/7 3/4 5/5 * * *
Muhammad Waseem Mukhtar **5/7 * **7/10 6/6 7/7 9/9
Abdul Aziz Khan 7/7 * 10/10 6/6 * 9/9
Mubashir A. Akhtar 7/7 11/11 5/5 * 4/5 *
Pervaiz Iqbal Butt 6/7 7/7 * * 2/2 5/5
Sheikh Jalees Ahmed 7/7 11/11 * 6/6 1/1 4/4
Khalid A. Sherwani 7/7 * 9/10 6/6 5/7 9/9
Total Number of meetings held 7 11 10 6 7 9
Note: Denominator showed total number of meetings entitled to attend.
* Not member.
** One meeting was not attended due to conflict of interest.
19
22. Chairman’s Message
In these challenging times
and changing market
dynamics, Allied Bank
has managed its progress
by maintaining its focus
on its clients across
its target markets and
businesses. Once again,
we have demonstrated our
commitment to stand by our
customers, while facilitating
and supporting them to the
maximum extent.
20
23. Annual Report of Allied Bank Limited for the year 2011
The performance of Your Bank in Temenos T-24, a core banking in ensuring service delivery across
2011, is the outcome of our strategy, software solution, which will further the network through branches, round
business focus, and growing tactical augment the service capabilities, the clock and customer service staff,
reach in target markets by capitalizing connectivity and overall efficiency but the strategic priority is to develop
on the right opportunities. levels. a prompt service culture across all
customer - contact points. The bank
We face the future In order to maximize the strategic
is continually upgrading its service
with confidence and advantage of Your Bank, work is going
benchmarks and is all geared to
on to continuously develope and
commitment. standardize the branch environment,
provide ‘Upscale’ customer service
experience.
Sustainable Growth facilities, staff & service delivery to
generate a ‘differentiating’ Allied Future Strategy
Our challenge is to continuously build Bank Experience - making it easier for
a Bank aimed at long-term growth, Your Bank enters 2012 with a strong
customers to get everyday banking
with a broad and diversified pool growth momentum. 2011 results
tasks done efficiently and comfortably.
of income streams, enhancing our reflect that the “Prudent Strategic
ability to manage and sustain our Managing Profitability Vision”, customer centric approach,
course, and to progress through tough technological-edge and right culture
Despite tough competition and
and unexpected turbulences of the is delivering enhanced and sustained
against an excessively long weak
present and future times. value for all the stakeholders.
economic environment and market
For the Board of Your Bank, it is not dynamics, Your Bank is making all Your Bank will continue to develop
about only positioning for growth efforts to consistently improving its ‘standardized’ banking proposition
in key growing markets, facilitating performance. and operating models to streamline
the customers, managing costs and enhance agility levels. Your Bank
Through the prevailing difficulties
and investing in new products, will keep on investing in its human
and fluctuating scenario, Your Bank
processes and technologies, but to capital, product platforms and
has shown resilience in maintaining
develop a cohesive, connected and deepen client relationships. Your Bank
its consistent growth momentum. The
comprehensive model for sustainable is committed to all its customers and
Bank remained available to all the
growth, providing value addition to all clients, to all targeted markets, and to
sectors of the economy and added
the customers and shareholders. all diverse businesses we serve.
large number of new customers from
Your Bank’s strategy is to focus on different segments. In line with the I would like to thank the entire
the fundamentals of good banking, ‘Strategic sustainable strategy of Your management and communicate my
prudence, innovation, teamwork and Bank’, the credit losses remain within sincere appreciation to all the staff
futuristic vision. single digit. Your Bank is determined of the Bank for the progress in 2011,
to keep on developing its core especially in these challenging times.
Building on Technology business, strengthening the growing I am thankful to our customers and
The world of banking and the needs of footprint, keeping low exposure clients for entrusting us with more of
customers have changed considerably in risky segments and improving their business and believing in our
over the last ten years and it is crucial its governance for internal control innovative and unique solutions in
that Your Bank evolves as a financial as well as for business processes meeting their financial needs. I am
institution to reflect these changes. and systems, to create an efficient, also thankful to all the communities
In creating a modern banking profitable and dynamic financial and the people we serve.
environment, Your Bank is developing institution.
And finally, I am grateful to the
alternate delivery platforms, to Service Experience Shareholders for their unflinching
facilitate the diverse customer support, trust and confidence in the
base in addition to equipping the Provision of high quality financial
Bank.
branch network with state- of- art services is the cornerstone of Your
facilities. Your Bank is in the process Bank’s strategy. Not only a dedicated
team of professionals are engaged Mohammad Naeem Mukhtar
of migrating to one unified system Chairman
21
24. Directors’ Report
Dear Shareholders Performance
Review
On behalf of the Board, we
are pleased to present the
annual report of Your Bank for
the year ended December 31, Your Bank posted pre-tax a drop of 2.1% from December 31,
2011. 2010 level of Rs. 267,776 million to
profit of Rs. 15,108 million
Rs. 262,137 million as at December
during 2011 as compared to 31, 2011. The Balance Sheet Size of
The operating results Rs. 12,343 million in 2010, Your Bank registered a YoY growth of
14.6% to reach at Rs. 515,699 million
and appropriations, as a YoY growth of 22.4%. The as at December 31, 2011. The Core
recommended by the Board profit after tax consequently Equity of Your Bank increased by
are included in the table: 20.7% to reach at Rs. 37,621 million
rose by 23.3% to reach at Rs.
as at December 31, 2011 compared to
10,140 million during 2011 Rs. 31,166 million as at December 31,
The Board of Directors has over Rs. 8,225 million in 2010.
proposed a final cash dividend 2010. As a result, EPS of Your Net Mark-up/Interest Income of Your
of Rs. 2.5 per share (aggregate Bank increased to Rs. 11.79 Bank increased by 11.5% to reach
Rs. 25,171 million; mainly led by
cash dividend of Rs. 5 per in 2011 compared to Rs. 9.56 volumetric growth in average earning
share including interim in 2010. The ROA and ROE of assets and improving deposit mix
dividend) and to issue bonus towards low cost core deposits. Non-
the Bank improved to 2.10%
Mark Up/Interest Income registered
shares in the proportion of 1 and 29.5% in 2011 over a healthy YoY 22.5% growth to reach
share for every 10 shares held, 1.89% and 28.8% in 2010, at Rs. 6,950 million during 2011, led
i.e., 10% for the year 2011. by rise in fee and commission income,
respectively.
income from dealing in foreign
This, together with the interim
Deposits of Your Bank reached to currencies and dividend income. The
dividend declared during Rs. 399,562 million as at December Administrative Expenses increased by
2011, will be approved in the 31, 2011 compared to Rs. 371,284 17.1% to Rs. 13,166 million compared
million as at December 31, 2010, a to Rs. 11,242 million in 2010.
forthcoming annual general YoY growth of 7.6%. Importantly, the
The provision against financing and
meeting. share of cost effective Current and
investments reduced by Rs. 1,074
low cost Savings Deposits in the total
million or 26.3% to Rs. 3,009 million
deposits base improved to 57.9% at
during 2011 compared to the previous
end-Dec 2011 compared to 55.1% at
year. The provision coverage against
end-Dec 2010. Investments increased
advances remained strong at 86.4%
to Rs. 195,694 million as at December
at December 31, 2011. No benefit of
31, 2011, a growth of 61.5% over level
FSV has been taken while determining
of December 31, 2010. Due to slow
the provision against NPLs as allowed
credit off take and cautious lending
under BSD Circular No. 02 of 2010
stance, the Gross Advances registered
dated June 03, 2010.
22
25. Annual Report of Allied Bank Limited for the year 2011
aspiring...
to deliver
(Rupees in million)
Year ended December 31,
2011 2010 Growth
Profit after tax for the year 10,140 8,225 23.28%
Accumulated profits brought forward 15,829 12,199 29.76%
Transfer from surplus on revaluation of fixed assets - net of tax 29 36 -19.44%
Profit available for appropriation 25,998 20,460 27.07%
Interim cash dividend for the year ended December 31, 2011 at Rs. 2.5 per share
(2010: Year ended December 31, 2010 at Rs. 2 per share) (2,151) (1,564) 37.53%
Final cash dividend for the year ended December 31, 2010 at Rs. 2 per share
(2010: Year ended December 31, 2009 at Rs. 2 per share) (1,564) (1,422) 9.99%
Bonus shares for the year ended December 31, 2010 @ 10%
(2010: Year ended December 31, 2009 @ 10%) * - - -
Transfer to Statutory Reserves (2,028) (1,645) 23.28%
Un-appropriated profits carried forward 20,255 15,829 27.96%
Earning Per Share (EPS) Rs. 11.79 9.56 23.33%
* Appropriation out of Share Premium Account
23
26. Directors’ Report
Calendar of Major Events.
Incorporation of Australasia Bank Limited 1942
Nationalization and merger of other three Bank i.e. Pak Bank Limited,
Lahore Commercial Bank Limited and Sarhad Bank Limited with and into
Australasia Bank Limited and its renaming as Allied Bank of Pakistan Limited 1974
Privatization under ESOP 1991
Reconstruction of Allied Bank of Pakistan Limited and handing over of its
Management to Ibrahim Group 2004
Organizational Restructing and re-branding by change of the name,
from “Allied Bank of Pakistan Limited” to “Allied Bank Limited” 2005
Listing on all the three Stock Exchanges of Pakistan 2005
Merger of Ibrahim Leasing Limited with Allied Bank Limited 2005
Largest online network of over 700 branches around the country 2005
Completed implementation of Oracle Financials Enterprise General Ledger 2006
Merger of First Allied Bank Modaraba with Allied Bank Limited 2006
Issued Listed Term Finance Certificates - I 2006
Agreement with Temenos for acquisition of “T-24” banking solution 2006
Launched Asset Management Company – Wholly owned subsidiary 2007
Launched branch in Export Promotion Zone - Karachi 2008
Issued Listed Term Finance Certificates - II 2009
Establishment of representative office in Dubai. 2011
License from Central Bank of Bahrain for “Wholesale Bank Branch” 2011
Financial Calendar - 2011
1st Quarter results issued on April 25, 2011
2nd Quarter results issued on August 01, 2011
3rd Quarter results issued on October 20, 2011
Recommendation of Annual Results by the BOD February 14, 2012
66th AGM Scheduled for Approval of Annual Results March 27, 2012
Financial Calendar - 2010
1st Quarter results issued on April 26, 2010
2nd Quarter results issued on August 12, 2010
3rd Quarter results issued on October 18, 2010
Recommendation of Annual Results by the BOD February 11, 2011
65th AGM Scheduled for Approval of Annual Results March 16, 2011
24
27. Annual Report of Allied Bank Limited for the year 2011
Statement under million, Rs. 3,639 million and Rs.
Statement of Internal
817 million, respectively, as per
Code of Corporate audited accounts of these funds Controls
for the year ended December 31,
Governance The Board is pleased to endorse the
2011. statement made by management
The Board of Directors is aware of its relating to internal control. The
• Pattern of Shareholding,
responsibilities under the Code of Management’s Statement on Internal
complying with the requirements
Corporate Governance and is pleased Control is included in the Annual
prescribed by the code is
to report that: Report.
annexed.
• The financial statements,
prepared by the management
• Statement of Compliance with Risk Management
Code of Corporate Governance is
of the Bank, present fairly its Framework
included in the Annual Report.
state of affairs, the result of
The Bank manages risk through a
its operations, cash flows and • We have criteria for nomination of
framework of sound risk principles
changes in equity. Bank’s executives on the Boards
which includes an optimum
of other companies where Allied
• Proper books of account of the organizational structure, risk
Bank is an investor company.
bank have been maintained. assessment and monitoring
The Human Capital Committee processes. The Risk Management
• Appropriate accounting policies of the Board decides these Group (RMG) is mandated to
have been consistently applied nominations. implement this framework as a
in preparation of financial function independent of commercial
• The committees of Board of
statements. Accounting lines of business, working under the
Directors along with their terms
estimates are based on guidance of Board’s Risk Management
of reference/charter have been
reasonable and prudent Committee (BRMC). RMG took several
separately disclosed in the
judgment. steps in 2011 to further strengthen the
Annual Report.
Risk Management Framework; which
• International Accounting
• The details of Board & Board’s include:
Standards, as applicable in
Committees meetings held during
Pakistan, have been followed • Developed and launched an
the year and attendance by each
in preparation of financial automated Integrity Check
director have been separately
statements and any departure application, which allows the
disclosed in the Annual Report.
there from has been adequately credit initiators and approvers,
disclosed in the Annual Accounts. an instant access to the obligor’s
history of write-offs / relief,
• The system of internal control is Change in the Board of
availed from Commercial Banks
sound in design and has been Directors in Pakistan since 1997 as per the
effectively implemented and
The Ministry of Finance vide its audited disclosures by the banks.
monitored.
notification dated January 20, 2012 • Upgraded the Loan Origination
• There are no significant doubts has appointed Mr. A. Akbar Sharifzada System (LOS) by automating
upon the Bank’s ability to on the Board as its Nominee Director. various credit application
continue as a going concern. The position was vacant since March workflows, and risk rating models
2010. The Board welcomes Mr. A. to enhance the efficiency
• There has been no material
Akbar Sharifzada as the new member. and effectiveness of credit
departure from the best practices
assessment process.
of corporate governance.
Chief Executive • Developed and implemented
• Performance highlights for the
last six years are attached.
Officer’s Review a Working Capital Assessment
Model which provides a
The Directors of Your Bank fully structured methodology to
• The book value of investment of
endorse the Chief Executive Officer’s assess the existing and projected
Pension Fund, Provident Fund
Review on the Bank’s performance for working capital requirements of
and Gratuity Fund is Rs. 5,338
the year ended December 31, 2011. the obligors.
25
28. Directors’ Report
• Developed a comprehensive TFCs Issues Sidat Hyder, Chartered Accountants
Country Risk Management and Messrs KPMG Taseer Hadi & Co.,
Framework in order to improve JCR-VIS Credit Rating Company has Chartered Accountants, for the next
the Country Risk Assessment maintained rating of AA- (Double A term.
process at Allied Bank, and com- Minus) assigned to Your Bank’s 1st
TFC Issue (issue date: December 06,
ply with SBP’s Risk Management Events after the date of
Guidelines and Basel II require- 2006). This rating denotes high credit
ments. quality. The rating of Your Bank’s Statement of Financial
second TFC Issue (Issue date: August Position
• Comprehensively reviewed and 28, 2009) of Rs. 3,000 million has
developed ALM & Liquidity Risk There have not been any material
also been maintained at AA- (Double
limit / trigger structure and events that occurred subsequent
A Minus) by PACRA. The rating denotes
upgraded the MIS for Market Risk to the date of the statement of
a very strong capacity for timely
reporting. the financial position that require
payment of financial commitments.
adjustments to the enclosed
• Developed an Operational Risk financial statements, except those
Loss Database, concluded the Corporate Governance which have already been made or
Risk & Control Self Assessment Rating disclosed.
Exercise, prepared an inventory
of operational risks, and initiated JCR-VIS Credit Rating Company
Operational Risk Loss Data Re- Limited has re-affirmed Corporate Acknowledgements
porting in an effort to prepare for Governance Rating (CGR) rating On behalf of the Board and
migration from the simple ‘Basic of Allied Bank at “CGR 8+” which management, we would like to
Indicator Approach’ (BIA) to a denotes ‘high level of corporate express our sincere appreciation
relatively advanced ‘Alternate governance’. to our customers and shareholders
Standardized Approach’ (ASA) for Corporate governance ratings for their patronage, State Bank of
Operational Risk Capital Charge are based on evaluation of key Pakistan, Securities and Exchange
Calculation. governance areas of the rated Commission of Pakistan and other
institution, which include regulatory regulatory bodies for their continuous
The Bank devotes considerable compliance; board oversight; guidance and support, and employees
resources in managing the risks to management profile; self-regulation; for all their continued dedication,
which it is exposed. The momentum financial transparency and enthusiasm and loyalty.
attained thus far will be continued relationship with stakeholders. The
in the future through significant rating takes into consideration the
investments in human resources, continued commitment of the board For and on behalf of the Board,
technology and training. and management of Your Bank
to maintain a sound governance
Entity Ratings framework.
The Pakistan Credit Rating Agency
(PACRA) has maintained ratings of Auditors Khalid A. Sherwani
Allied Bank Limited [long-term: AA Chief Executive Officer
The present auditors Messrs KPMG
and short term: A1+] with a “Positive Taseer Hadi & Co., Chartered
Outlook”. The ratings denote a Dated: February 14, 2012
Accountants and Messrs Ernst &
very low expectation of credit risk Place: Lahore
Young Ford Rhodes Sidat Hyder,
emanating from a very strong capacity Chartered Accountants retire and
for timely payment of financial being eligible offer themselves for
commitments. The Positive Outlook re-appointment.
acknowledges Allied Bank’s consistent The Board of Directors, on the
robust performance, emanating from recommendation of the Audit
sustained growth and sound asset Committee, has recommended
quality. Messrs Ernst & Young Ford Rhodes
26
29. Annual Report of Allied Bank Limited for the year 2011
aspiring...
to Serve...
27
30. The Management
Khalid A. Sherwani Sheikh Jalees Ahmed Tariq Mahmood Zia Ijaz
Chief Executive Officer Executive Director, Strategic Planning Group Chief, Operations Group Chief, Commercial andRetail
Banking
A seasoned banker with strategic He joined Allied Bank’s Board Heading the Operations Group at
leadership experience of over in 2004 and has more than 36 Allied Bank since January 2007, Diversified experience in the
40 years of banking operations, years of diverse experience in the Tariq Mahmood has valuable areas of Accountancy, Financial
marketing, finance and information fields of Financial and Industrial banking experience of 40 years in Management and Commercial
technology, Khalid Sherwani has and Retail Banking in domestic
management. He has completed senior positions while associated
been appointed Chief Executive and international markets
Board Development Series with major banks. His immense
of ABL for the second time in June acquired over a 20 year career
Certificate Program from Pakistan knowledge of the field, covering
2010. His exceptional track record
Institute of Corporate Governance areas of Retail Banking, Foreign gives Zia Ijaz a distinct edge with
includes restructuring and turning
and is a “Certified Director”. Trade, Operations and Credit, exceptionally judicious skills in
around UBL during 1996-2000,
restructuring and recapitalization of Allied Bank benefits from his along with a proactive approach to his field. Before joining ABL, he
ABL during 2000-04 and leading professional expertise particularly problem solving, is an enormous worked in major banks in Riyadh,
its turnaround during 2004-07. in the areas of strategic and asset to ABL. During his service as Saudi Arabia and Pakistan at
financial planning, systems and a member of pioneer team with senior positions; he has also
Khalid Sherwani holds M.Sc. degree
controls and HR management. a prominent bank before joining served as CFO of Allied Bank for
and has also completed Board
Allied Bank, he demonstrated an 5 years. Zia was associated with
Development Series Certificate
Program from Pakistan Institute outstanding ability to develop Ernst & Young Ford Rhodes Sidat
of Corporate Governance and is a business, processes and branch Hyder, Chartered Accountants
“Certified Director”. network. before becoming a banker, and is
Fellow Member of the Institute of
Besides CEO of Allied Bank he is also
Chartered Accountants of Pakistan
on the Board of First Women Bank
and CPA from AICPA, USA.
Limited; Habib Allied International
Bank, U.K; ABL Asset Management
Company Limited and 1 Link
(Guarantee) Limited.
28
31. Annual Report of Allied Bank Limited for the year 2011
Muhammad Jawaid Iqbal Muhammad Shahzad Sadiq Tahir Hassan Qureshi Shafique Ahmed Uqaili
Group Chief, Treasury, Corporate and Group Chief, Risk Management Chief Financial Officer Group Chief, Human Resource
Investment Banking
With his diversified experience of At his current assignment of CFO He has over 27 years of national
Jawaid Iqbal joined ABL in May
over 20 years in multinational and at ABL since 2008, Tahir Qureshi and international experience as
2005, bringing with him invalu-
local banks as well as leading in- has over 18 years of banking ex- a Human Resource specialist and
able experience of over 20 years
dustrial organizations, along with perience and is a valued member has worked in various business
in Corporate and Investment
a can-do attitude, Shahzad Sadiq of the Management team. Prior sectors including Commercial
Banking. His proactive involve-
has proved to be an exceptional to joining ABL he has held senior Banking, non-banking financial
ment in setting up the Corporate
asset to ABL. During his extensive management portfolios in Fi- institutions, pharmaceuticals and
and Investment Banking Group
career he has held key positions nance, Taxation and Corporate Af- retail and consumer fields. Bring-
at the Bank, and his leadership
including Chief Financial Officer fairs in leading banks of Pakistan. ing his invaluable expertise in the
qualities have resulted in the ABL
as well as Head of Planning & A fellow member of the Institute HR field, Shafique joined ABL in
emerging as one of the foremost
Corporate Affairs. Before being of Chartered Accountants of Pa- 2006 and is a valued member of
banks in the field, winning numer-
assigned as Chief Risk Officer in kistan, he is also a member of the the Management team
ous awards. Jawaid is a Chartered
August 2011, he was Head of Audit Institute’s Banking Committee and
Financial Analyst with a Masters
and Risk Review Group at Allied Pakistan Banking Association’s
degree in Business Administration.
Bank. He is a fellow member of the Subcommittee on Accounting and
Before joining Allied Bank, he
Institute of Chartered Accountants Taxation.
served at major banks in Pakistan
of Pakistan
at leading positions. He is also the
president of the CFA Association
of Pakistan.
29
32. The Management
Mohammad Abbas Sheikh Mujahid Ali Khawaja Mohammad Almas
Group Chief, Special Assets Group Chief, Information Technology Group Chief, Banking Systems &
Management Implementation
ABL was restructured and Currently mandated with imple- Associated with Allied bank
recapitalized in 2004 and since menting T-24, the state of the since 1983, Khawaja Almas has
then Abbas Sheikh has been art core banking application, served at key slots in Business
heading the Bank’s Special Assets and other IT initiatives aimed at and Supporting Groups. During
Management Group. He has over enhancing the Bank’s efficiency his distinguished career with the
25 years of experience in both and customer satisfaction at ABL, Bank he has represented ABL at
local and international banking Mujahid joined the Bank in 2008. numerous local and international
and during the past 12 years led He has over 20 years experience forums as Trainer and participated
the Remedial Asset Group of two in the area of IT Planning and De- in conference within the country
large banks, successfully settling velopment, Project Management and abroad. He holds a Masters
numerous old and chronic de- and Systems Implementation. degree in Business Administration
faulters’ accounts. This experience along with DAIBP. Currently he
is of enormous value in his current is instrumental in implementing
assignment helping ABL achieve Core Banking Software, making
set targets. a great impact for a progressive
bank like ABL.
30
33. Annual Report of Allied Bank Limited for the year 2011
Fareed Vardag Abdul Hafeez Butt Muhammad Raffat
Group Chief, Audit Group Chief, Compliance Company Secretary
He is a seasoned banker having Hafeez But has been instrumental Appointed Company Secretary of
more than 26 years of extensive in helping teams successfully ABL in 2010, Muhammad Raffat
experience in the areas of trade fi- achieve objectives in the field of looks after the Corporate Affairs
nance, corporate banking and risk Risk Management and Banking Group. He has a distinguished
management with distinguished Operations. Under his leadership, association with the Bank of over
international and domestic bank- projects such as centralization 30 years and during this time has
ing institutions. He joined Allied of Trade Factory and Business served in various areas of banking,
Bank in March 2005 as Chief Risk Process Re-engineering have gaining a vast range of experience
Officer and successfully revamped been successfully completed. He and in-depth understanding in
the critical function of Risk Man- has over 40 years of experience in the field. His qualifications include
agement in line with modern best both local and foreign banks with DAIBP, M.A. and LL.B.
practices. As part of Allied Bank’s a record of meeting and achieving
human capital development strat- targets. He has been directly
egy, Group Chiefs are rotated on involved in improving ABL’s branch
an on-going basis across various Banking Operations and Risk
groups to broaden their exposure Management Function. He holds
and in August 2011 Mr. Fareed a Masters degree in Business
Vardag was therefore transferred Administration. Considering his
as Group Chief of Audit & Risk multi-faceted experience in bank-
Review. This change augmented ing, he has been assigned the
the Bank’s audit function inducing responsibility to head Compliance
a new perspective and vigor. Group in August 2011.
31
34. Org-Structure
Board of Directors
Audit Committee
of the Board
President & CEO
Audit & Risk Review
Group
Strategic Planning
Group
Commercial &
Corporate Affairs Group
Retail Banking Group
Corporate & Finance Group
Investment Banking Group
Treasury Group Human Resource Group
Risk Management Compliance Group
Group
Operations Group Information Technology
Group
Banking Systems &
Special Assets Management
Implementation Group
Group
32
35. Annual Report of Allied Bank Limited for the year 2011
aspiring...
to create value
33
36. Chief Executive Officer’s Review
Pakistan’s economy Real GDP growth moderated to 2.4% external sources of funding have
in FY 2011 mainly due to lackluster dried up with actual net capital and
continues to face various
performance of the industrial sector financial inflows during H1—FY12
challenges impacting though agricultural sector showed reducing to USD 167 million only.
the prospects of resilience despite catastrophic floods Consequently, foreign exchange
economic recovery and of 2010. reserves declined by USD 1.4 billion
by the year end from its peak in July
macroeconomic stability. However, fiscal deficit for FY 2011
2011 of USD 18.3 billion with ensuing
recorded at 5.9% of GDP. The
The fiscal weakness and pressure on foreign exchange rates.
provisional estimate of fiscal deficit for
the concerns over financing H1-FY12 also suggests likely breach After recording the peak of 13.9%
of the external current of the targeted deficit for FY12 with in January 2011, YoY CPI inflation
account deficits are the risk of further slippages on account reduced in the second half of the year
of subsidies remains. Importantly, reaching to 9.7% in December 2011.
foremost risks. Meanwhile,
financing of the deficit from external This was attributable to moderation
persistence of structural sources has remained well short of in aggregate demand as well as
bottlenecks, mainly severe the expectations, thereby leading to improvement in domestic supplies
heavy reliance on borrowings from of food items. Further the high base
energy shortage and a
the banking system. This in turn has effect of prior year and change
sensitive law and order squeezed the availability of credit in calculation methodology also
situation continues to act as for the private sector and increased contributed towards the YoY decline.
impediments for economic pressure on liquidity. However, underlying inflationary
pressures remain on the back of
growth. The uncertainty The country’s external account
substantial amount of government
attached with global which was in surplus during first half
borrowings, possible adjustment
of year 2011 turned into deficit by
economic outlook also has in prices of fuel and electricity and
the year end due to a deteriorating
pass through impact of Rupee
unfavorable implications. trade balance, though Inward
depreciation.
Worker’s remittance remained upbeat
throughout the year. Meanwhile, the
34
37. Annual Report of Allied Bank Limited for the year 2011
The M2 growth has shown
deceleration in second half of 2011
primarily due to sharp contraction
in NFA of the banking system. Given
substantial government borrowings
together with rising NPLs emanating
from tough operating conditions for
businesses, there is a growing tilt of
banking resources moving towards
government paper. In November
2011, the Government issued Rs. 391
billion of securities to banks as part
of the swap arrangement to retire the
outstanding inter-agency circular
debt of the energy sector and the
unpaid subsidy claims on account of
government’s commodity operations. GDP Growth
(Percentage)
In an effort to revive the private 8
sector investments, the State Bank 6.8%
of Pakistan (SBP) has reduced the 6
policy rate by 50 bps and 150 bps in
4 3.8%
August and October 2011 Monetary 3.7%
3.5%*
Policy Statements (MPS), respectively. 2
2.4%
1.7%
However, given the deviation in key
variables from the projected path the 0
2007 2008 2009 2010 2011 2012
policy rate has been kept constant * Expected
thereafter so far.
Interest Rates
Under the prevailing circumstances (2011)
we remained committed to our 16%
strategy of steady growth in 15%
quality avenues with emphasis on 14%
strengthening the risk architecture 13%
to efficiently manage the associated
12%
risks. The cornerstone of our business
11%
philosophy remains on customers’
10%
satisfaction, providing long-term Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
competitive advantage, through KIBOR Tbills Discount Rate
strong importance given to quality
of service, product innovation and
efficient delivery. In the process we
aim to exploit our customer centric
strong technological infrastructure
with continuous upgradation to
remain at par with the best in industry.
Our focus remain on improving our
cost effective deposit mix by further
increasing proportion of Current and
Savings (CASA) deposits.
35
38. CEO’s Review
Business
Performance extensive customer base, Allied
Ba’ Ikhtiar – a unique term deposit
product was launched during 2011
which provides flexibility in terms of
Commercial & Retail branches’ renovation over the years profit options. Further, new financing
and now over 50% of our network has
Banking products for SMEs and Agriculture
been renovated. Further, a strategy of segments were introduced to
Commercial & Retail Banking Group relocation of branches is also being enhance financing options available
made significant headway during pursued for increasing business to the borrowers. Emphasis during
2011 in achieving the bank’s overall capability. the year remained on moving
strategic objectives and providing
During 2011, the Group successfully towards optimization of cross sell
efficient and reliable banking services
implemented its strategy of increasing opportunities, effective capitalization
to its over two million relationships.
the proportion of low cost deposits as of the strong ADCs platform to
Allied Bank’s extensive network of
the mix of current deposits and low increase transaction volumes and
branches expanded by opening of
cost savings deposits (CASA) improved focus on non-fund based avenues to
30 new branches to reach at 837
YoY by 275 bps to reach at 57.9% maximize the bank’s revenue.
during the year. To improve branches’
at end-Dec 2011. The last quarter The exclusive concept of “Women
ambience and providing modern
of 2011 witnessed significant rise in Branch” which was introduced as a
facilities to the customers the bank
rates offered to institutional deposits piolt in Lahore last year has been
has consistently followed the policy of
due to the liquidity issue faced by expanded further with addition of
the banking industry. As a conscious another branch in Faisalabad.
decision to protect bank’s margins,
keeping in view limited deployment Consumer segment remain on
opportunities to the private sector, lower priority in the Bank’s business
the bank chose not to go for rates strategy. Only few products are
increase for big ticket deposits. offered to the Bank’s strong profile
Hence, the YoY growth of 7.6% in customers to have a complete suite
outstanding deposits is relatively less of products available to them to meet
compared to industry’s growth during their financing needs.
the year.
Going forward, the Group focus shall
As part of the product innovation remain on improvement in deposits
strategy to satisfy needs of an mix, product and service innovation to
tap new avenues and quality growth
in advances. Specific initiatives are
being planned to effectively target
various customers’ segments and
exploiting cross sell opportunities. The
Group shall also aim for achieving the
greater objective of financial inclusion
by targeting the large unbanked
population in the country in a phased
manner.
36
39. Annual Report of Allied Bank Limited for the year 2011
Corporate & Investment Banking Considering the difficult environment Allied Bank’s Home Remittance
at hand, the Group focus remained on Business has grown appreciably in
The Corporate and Investment
the quality of its loan book, gearing 2011 with 33% growth in volumes
Banking Group (CIBG) maintained its
up of portfolio monitoring efforts to disbursed compared to 2010.
position as one of the leading player
identify issues with the borrowers Associated with a growing number
in the industry for providing structured
at an early stage and speeding up of International Correspondents,
financial solutions and advisory
recovery efforts in respect of the our Home Remittance Service is the
services to premier corporates.
infected portfolio. The Group followed channel of choice for most large
Despite a difficult environment
a two pronged strategy a) increasing Pakistani Expatriate locations. In order
wherein project financing activities
exposure to premier corporates, to enhance customers’ experience
and the demand for advisory services
having strong business fundamentals and to deliver efficient service,
has declined, the Group managed to
and tested re-payment track record substantial improvements were
sustain its contribution of advisory
by extending short-term facilities and, made during the year in systems and
income in the total income of the
b) exiting from or reducing exposure procedures resulting in a reduced
Bank.
to weak borrowers. turnaround time and enhanced
During 2011 Allied Bank won the “Best controls.
Focus on industry specific products
Domestic Investment Bank of the
and solutions for client receivables, The Group is also looking after the
Year - Pakistan” award by the Asset
payments and liquidity management Allied Bank’s initiatives to establish
Magazine Hong Kong for the third
has enabled Cash Management international footprint and recently
consecutive year and also the “Highly
Unit to achieve 65% growth in opened an offshore branch in Bahrain
Commended Islamic Project Finance
transactional volumes during 2011. and a Representative Office in Dubai.
Deal -2011” in the Assets Asian Awards
Our entire product offering is fully
2011. The awards are recognition of
customizable and supported by
the Group’s endeavors in providing
comprehensive real-time MIS delivery
valued solutions to our corporate
to the customers.
clientele.
37
40. CEO’s Review
Special Asset Management Under this strategy over 1,400 MTOs
have been inducted through various
Owing to the rising trend in NPLs
batches during the past 4 years.
across the banking sector, the
Remedial Assets Management To support Bank’s credit risk strategy
has gained increasing importance through detailed analytics and
for preserving Bank’s profitability. strengthening our knowledge of
Through the joint efforts of SAMG borrowers’ business and associated
and Business Groups, the Bank made risks, the Bank has recruited industry
recoveries and regularization of over experts with formal engineering
Rs. 3 billion for the third consecutive qualifications. Likewise, in order to
year, thereby retaining the Bank’s low improve technical competency mix
infection ratio compared to industry amongst our ranks, the Bank also
averages and peers. recruited a batch of Management
Trainee Engineers (MTEs). These are
Human Resource
qualified engineers with degrees from
Allied Bank recognise the pivotal role top-ranked engineering institutions
Treasury & FX Management
of its most valuable asset, its people. with formal business qualifications.
Being cognizant of the developments They are the main drivers of long-term The MTEs went through an extensive 6
on economic front during the year, sustainable growth and performance. week training program encompassing
Treasury played a pivotal role to The Bank consequently endeavors areas of general banking, credits,
ensure optimum profitable utilization on instilling the pursuit of excellence prudential regulations, risk
of the bank’s funds both in money amongst employees. management techniques and general
market and foreign exchange. In management skills along with job
collaboration with other groups, it also The Bank focused on strengthening
rotation at branches.
played its part for growing volumes of its resource pool by acquiring the best
trade related business activities. talent in the market and providing Being the equal opportunity
them with planned career growth employer, the Bank persisted with
Year 2011 witnessed higher volatility
opportunities. One of the Bank’s its commitment to the philosophy of
in the foreign exchange market as
aims is to become an ‘employer of women being effective contributors
Rupee depreciated by 5.03% in 2011
choice’ not only because of offering in economic activities. Female
compared to 1.65% in 2010. During
market competitive packages, but employment ratio at Allied Bank has
the period, Treasury continued to
also by imparting one of the best further increased to 13% of the total
serve the Bank’s clientele, advising
on-the-job training experiences, employees during the year.
them about market trends and
expectations, resulting in volume providing cross-functional rotation
Augmenting a ‘learning culture’,
growth for the Bank but also to enable the employee to grow and
808 in-house and ex-house training
strengthening the relationship with entrusting young employees with key
programs were conducted during
the customers. responsibilities to prepare them for
the year wherein 7,124 employees
future leadership roles.
Further, major shifts occurred in SBP’s participated, including 60 employees
Monetary Policy Stance for managing As part of the continuing strategy to attending overseas training. Moreover,
the challenges faced by the economy. mix youth with the experience, the the Bank also invited international
Treasury took a proactive approach management adopted the policy of trainers to impart customized training
and re-profiled the Bank’s investment inducting fresh post-graduates of for middle and senior management.
portfolio to hedge Bank’s earnings Business, Commerce and Engineering Investment made on employee
against downward shift in the yield backgrounds from leading institutions development grew by 30% from last
curve, thereby locking higher return as Management Trainees through year.
on the Bank’s investment portfolio. a transparent screening process.
38
41. Annual Report of Allied Bank Limited for the year 2011
aspiring...
to work
39
42. CEO’s Review
Service Quality where it needs to ensure that quality Risk Management
resolution is provided in a timely
Allied Bank places a strong emphasis Risk Management involves setting
manner to the customers to enrich
on the quality of the service it the most appropriate course of action
their experience. To build upon this,
provides. A dedicated Service Quality under uncertainty by identifying,
Service Quality has introduced Service
function is in place at the Bank with assessing, communicating and
Standards to bring efficiency in the
the basic aim to build a service culture addressing risk issues. Recognizing
complaint handling process; further
across all the segments of the Bank, the international trends and
a procedural guideline has also been
ensuring that a standardized quality global focus; Risk management is
introduced to guide customers on
is maintained at all customer point an essential pillar of our banking
lodgment of a complaint along with its
of contact, surpassing our valued strategy. The Risk Management Group
resolution mechanism.
customers’ expectations. is actively measuring, controlling
Being in line with our commitment and reporting risks across the Bank.
To build upon customer franchise,
to provide enriched customer Modern analytical tools are used
a new service channel has been
experience, Service Quality acts in combination with traditional
introduced on the Bank’s corporate
as a facilitator and change agent techniques to assess credit,
website, where our valued and
where measures are taken across operational, market and liquidity
prospect customers can conveniently
all segments of the Bank, whereby, risks. Risk appetite in the form of
submit their complaints, make
“Quality Service Selling” is a part of regulatory capital allocation has been
enquiries, requests and/or give
our business in addition to monitoring determined for the above three risk
suggestions.
and improvement of the prescribed forms in addition to capital adequacy.
Complaint handling has always been service standards.
an important area for the bank,
40