central bank final-2
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&a n k i n g S y s t e mt r u c t u r e i n P a k i s t a n
:re p a r e d b y&Syed Ali Abbas Zaidi Mo
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What is a Bank ? What is a Bank ?
1) Bank is an institution
Chartered by a State or Federal AgencyAccepts demand deposits
Offers commercial loans.
2) Bank is a financial intermediary which
Collects credit from lenders in the form of depositsLends in the form of loans
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)1 epositsA commercial bank holds deposits for individuals and businesses in the
form of
Current Accounts Savings Accounts ( )Certificates of deposits varying maturities
) LoansA commercial bank issues loans in the form of
Personal loans Business loans .Mortgages
rimary Activityrimary Activity
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1) Central Bank State Bank of Pakistan
Operate as Regulator of the EconomyDevise Monitory and Fiscal PoliciesRegulator for other banks in Country
2) Commercial Bank - Commercial banks handle banking needs for
Large and Small businessesIndividuals
) -3 Investment Bank Work in the investment markets and do not take customerdeposits
ypes of banksypes of banks
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Organisationrganisation andnd Structuretructure off Commercialommercial Banksanksq Structure of Banks
Banks can be classified into three groups in terms of sizeand asset concentration Small Medium and .Large
Size and asset concentration often determines theorganisational structure of a bank
q Other factors Affecting Organisational Structure Services offered Branch Networking Specialize products Technology
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Board of Directors
(Chief Administrative Officer Board/ / /Chairman President CEO Managing Director
&AccountingOperations Division
&Accounting AuditDepartment
Operations( ,check clearing
,postingAccount, &verification
)Customer complaint
- &Fund RaisingMarketing Division
Tellers orCustomer Service
officers
New Accounts
&AdvertisingPlanning
Lending DivisionOr Loans
Department
CommercialLoan
Consumer Loan
TrustDivision
PersonalTrusts
BusinessTrusts
rganizational Structurerganizational Structuref Banksf Banks
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&nit &nit Branchranch Bankinganking Organisationsrganisations q Unit banking
banking organisation whereby all services of.banks are offered from one office
,Such office may have offer facilities such as- , ( ),drive in windows automated teller machines ATM- -retail store point of sale terminals that are ,linked to the banks computers system and Online
( ).Banking internet website
q Branch banking This system offered where full range of banking,services are offered from several locations
which includes a head office and their operated.branch offices
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/dvantages Disadvantages of/dvantages Disadvantages ofranch Bankingranch Banking Advantages
Branch Banking enhances REACH of banks tocustomers
,It provides easy improved and convenience in
services to the customers It reduces transaction costs for customers
Disadvantages Full branching may lead to increase in
/operational service cost It may lead to edging out of small competitors It may lead to variation in type and quality of
.services from branch to branch of the same bank
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ommercial Banksommercial Banks The commercial banks in addition to provide
working capital and long-term financing tothe investors, offers a range of vital services,
such as remittances of profits / dividends
currency accounts, etc.
The specialized development institutionsprovide credit for investment in varioussectors.
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inancial Statements of Banksinancial Statements of Banks( ) Financial statements FSs is also known as road map of a
,banks which indicates the past present and futurepositions in turn to provide actual facts and figure and
also helpful to making decisionsFSs also reflect the type of services banks are offering
.and the size of banks
FSs can be grouped into two main forms (Balance sheet Report of Condition) and (Income statement Report of Income).
The balance sheet comprises in to two parts (Financial Outputs uses of funds or Assets) (Financial Inputs sources of funds or liabilities plus
equity capital).
The income statement also comprises of two components (Financial Output revenues and incomes) (Financial Inputs the cost of acquiring funds orexpenses).
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Sale and buy-back agreement
Musharakah (Joint Venture)
Mudarabah
MurabahaHibah (Gift)
Ijarah
Takaful (Islamic Insurance)
slamic Financial Transactionslamic Financial TransactionTerminologyerminology
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!hank You!hank You
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