Zarai Taraqiati Bank Limited, Bahawalpur

by
Habiba Usman
Roll# 16
Supervised by
Madam Maryum Ashraf
Internship report
Department of Management Sciences
GSCWU Bahawalpur
Spring 2016

Govt. Sadiq College Women University of Bahawalpur

ACKNOWLEDGEMENTS
With the name of Allah Almighty, Who is one in this universe in His soul and attributes and who blessed
this universe with colors and lights of Himself. Whenever, I will think about the showers of blessings
which His everlasting self has blessed to the mountainous areas of Pakistan, the words of immense
appreciation will become due for Allah Almighty, the greatest merciful. Thousand words of thankful are
also due to His Prophet Muhammad (Peace Be Upon Him), who eradicated all the discriminations
among human beings based on color and creed and who equalized the whole humanity.
I would like to appreciate my supervisor Madam Maryum Ashraf Lecturer in Govt. Sadiq
College Women University of Bahawalpur for her supervision and support. She always encourages me
to work hard. I found her very cooperative while discussing the fabrication and characterization issues in
this dissertation. Her critical comments on my work have certainly made me ponder new ideas and
techniques.
Specially, I would like to thanks to Sir Ayaz Shahzad, AMO (Assistant Manager Officer) who
supervised me during my internship at ZTBL bank. Who taught me about banking and all the terms
related to the bank. He is very much cooperative. He let me things know and how I have to deal with
customers in banking system. He pointed out my mistakes, and his critical comments made me better
during my Intership Period. Thanks to all staff of ZTBL. They gave me their precious time and I learned
a lot from them. Thanks to all my friends and family members who helped me.

Summary
Banking is one of the most sensitive businesses in all over the world. Banks play very important role in
the economy of every country round the world including Pakistan. This report is about of the leading
Agriculture. Zarai Taraqiati Bank Limited (ZTBL) is playing its one of the most important role in the
development of the Agriculture sector in Pakistan. On 14 th December 2002, under the ordinance of the
Agriculture Development of the Pakistan 1961 ZTBL was incorporated as Public Limited Company.
This bank severs its venerated customers in the form of different customized products. It is providing
both type of servers financial and non-financials mostly to its clients of the rural areas of the Pakistan,
which comprises of 68% of the Paistans total population. Bank has country wide network in the form of
438 branches and is severing round about half of the million clients annually and over accumulated
account holders with the average loan size of around Rs89, 000 serving 65%, 31% & 4% of subsistence
and large growers respectively.
The ZTBL particularly in ruler areas of Pakistan are now providing credit for the development of
agriculture and industrial sector. The provision of credit to agriculture and industrial sector has greatly
helped in raising agricultural productivity and income of the farmers. This has led to increased demand
for industrial goods and expansion of trade and industry. The use of bank drafts, cheque, bills of
exchange, credit cards etc, has revolutionized both national and international trade. The ZTBL plays an
important role in raising of the financial resources. They encourage savings by giving various types of
incentives to the savers. They expand the branches in ruler and urban areas and mobilize savings even at
far of places. These savings are then made available to the businesses which make use for the productive
purposes in the country.
The ZTBL plays an important role in achieving balanced development in different regions of the
country. They help in transferring surplus capital from developed regions to the under developing
regions. The trade industries of less developed regions are able to get adequate capital for meeting their
business needs. This in turn, increases investment, trade and production in the country. The central bank
sof a country controls and regulates volume of credit through the active corporation of the banking
system in the country. It helps in bringing price stability and promotes economic growth within shortest
possible period of time.

List of Abbreviation

CBAS: Centralized Branch Automation System

CDMS: Centralized Deposit Management System
CIR: Customer Investigation Report
ICRMS: Internal Credit Risk Management System
IMIS: Interactive Management Information System
NIVS: National Identity Verification System

TABLE OF CONTENTS
Sr. No
01

Chapters

Page No

Chapter1

01-06

1.1Introduction
1.1 History
1.2.1Reason to change ADBP to ZTBL
1.3 Mission
1.4 Vision
1.5 Objectives
1.6 Infrastructure of ZTBL
1.6.1 Board Committees
1.6.2 Management Committees
02

Chapter 2

07-12

03

Personal Working and Learning Experience

Chapter 3

13-21

Analysis
Non Financial Analysis
3.1 PEST Analysis
3.2 Marketing Analysis
3.3 Competitors Analysis
3.4 SWOT Analysis
3.5 Financial Analysis
3.5.1 Liquidity Ratio
3.5.2 Leverage Ratio
04

3.5.3 Profitability Ratio

Chapter 4

22-30

4.1 Conclusion
4.2 Recommendation
05

4.3 Annexure
References

31

Chapter 1
1.1 Introduction:
The Zarai Taraqiati Bank Limited (ZTBL)) is the largest public sector financial development
institution in Pakistan. The bank serves around half a million clients annually and has over one million
accumulated account holders and a wide network consist of 32 Zones, 9 Audit Zones and 436 branches
in the country. ZTBL is also providing branch less banking facility to its customers through Upaisa, a
joint effort by ZTBL and U Microfinance Bank Limited
Agricultural Development Finance Corporation was created in 1952 under a Central Act for the purpose
of expanding financial facilities and promoting the development and modernization of agriculture in
Pakistan. In 1957, the Agricultural Bank of Pakistan was established and advanced both short and long
term loans. Both these institutions were merged as Agricultural Development Bank of Pakistan in
February 1961. On December 14, 2002, the Federal Government converted the Agricultural
Development Bank of Pakistan (ADBP) into Zarai Taraqiati Bank Ltd (ZTBL). The new corporate
structure redefined the banks as a single public limited company with an independent Board of
Directors.
Zarai Taraqiati Bank Limited (ZTBL) was registered under the Companies Ordinance 1984, and all
assets, liabilities and proceedings were transferred to and vested in Zari Taraqiati Bank with effect from
December 14, 2002.

Number of Departments/Divisions:

Account Division
Credit Division
Finance Division
Human Resource Division
Information System Division
Liability Marketing Division
Operation Division Services Division
1

Training and Development Division

Vigilance division
Credit Administration & Risk Management Division
Internal Audit Division
Kissan Support Services Pvt. (Ltd.)
Law Division
Planning, Research & Technology Division
Recovery & SAM Division

1.2 History:
Basically Pakistan is an agriculture country and finance is much needed for its rapid development with a
view to meet this basic need the Agriculture Development Bank was set in September 1957 and was intrusted with a task of providing financial facilities for the development of agriculture including

Forestry
Fishing
Animal Husbandry
Poultry
Dairy Farming

The main process of establishing agriculture bank is to provide credit in cash or in kind, warehousing
and storage facilities to agriculturists, corporative societies and other bodies of which the majority of
members are agriculturists. ZTBL was incorporated on 14 december 2002 through repeal of ADP
ordinance of 1961.

1.2.1 Reason to Change ADBP to ZTBL:

The restructuring of the former ADBP is being carried out with the aim to uplift the agriculture and rural
sector by raising farm productivity, streamlining the institutional credit and increasing the income
generating capacity of the farming community.

1.3 Mission:
To play effective role in the promotion of the economic growth, by enhancing the availability of credit to
the agriculture sector, through reliable access to sustainable financing, special landing program technical
assistance, and other products and services, and to promote career development opportunities for
increasing professionalism and technical proficiencies of employees.

1.4 Vision:
Dedicated to serve the needs of the farming community, by delivering financial products and technical
services on a competitive and sustainable basis, in a convenient, efficient and professional manner,
leading to success of the bank and farmers.

1.5 Objectives:

Develop and operate the financial and operational sustainability of the country.

Assist rural community, particularly the small farmers, in raising their productivity and income
levels through timely delivery of credit, advisory and ancillary services.

Build ZTBL's image as a proactive, client friendly, financially & operationally sustainable with
indigenous product deployment.

Establish and provide backward and forward linkages to strengthen agriculture.

To function as a rural commercial bank to mobilize rural capital formation and to commercialize
the agriculture sector by delivering the true value of credit to the client.

Provide a wide range of risk insurance products to its clients.

Open up its venues of operation to Domestic & International Banking Industry to avail
comparative advantages.

1.6 Infrastructure of ZTBL:

The overall management, functions, meetings of the ZTBL is control by two committees known as
Board & Management Committees. The sub-committees of these two committees are explaining as
under;

1.6.1 Board committees:

Audit Committee:
This committee has one chairman, four members that are the directors of the ZTBL and one secretary
from the Audit Department. The designation of secretary is the Chief Internal Auditor of Audit
Department.
Human Resource Management (HRM) Committee:
This committee has one chairman & president of the ZTBL, four members that are the directors of the
ZTBL and one secretary from the HRM Department. The designation of secretary is the Head of the
HRM Department.
Risk Management Committee:
This committee has one chairman & three members that are the directors of the ZTBL. But one member
designation is the risk manager. But in risk management committee, the company secretary act as
member and secretary as well.
Information Technology (IT) Committee:
This committee has one convener & two members that are the directors of the ZTBL. One member is
from IT Department & his designation is the Chief information officer. While one secretary (Head) of IT
Department.

1.6.2 Management Committees:

Assets Liabilities Management Committees:
This committee has one convener (CEO) & three members. The designation of the first member is the
SEVP of Operation Department. The designation of the second member is the risk manger. But the third
member (Chief Financial Officer) acts as member and secretary as well

Executive Committee Coordination:

This committee has one Convener(CEO), one secretary(Compliance Officer) & three members. The
designation of the first is the SEVP. The designation of the second is the EVP. The designation of the
second is the EVP. The designation of the third member is the risk manager.
Organization Structure of ZTBL:
The general direction and superintendence of the affairs of the bank are entrusted to a 12 members
Board of Directors consisting of a chairman appointed by the Federal Government, the Federal
Government officers from the Ministries of Finance and Food and Agriculture. There are four officers of
the four Provincial Governments and one non official nominated by each province. One member on this
board represents the State Bank of Pakistan also. In ZTBL, the president supervises and directs the
senior executive who supervises and directs the senior vice president, and senior vice president control
voice president, who control Assistant vice president, who finally supervise officers. The management
hierarchy of bank is as follow:

Board of
Directors

President

Committees of
ZTBL

Management
Committees

Board
Committees

Audit
Committ
ee

HRM
Committ
ee

Risk
Managem
ent
Committe

Informat
ion
Technolo
gy

Assets
Liabilities
Manageme
ntCommitte

Executive
Coordina
tion
Committe

Chapter 2
2.1 Personal Working and Learning Experience
My working experience in ZTBL was very enthusiastic. The whole staff was very corporative and kind.
I learned professionalism while working at ZTBL. The environment was good enough and was a
working environment. This internship give me exposure of new, interesting professional situations. My
internship gave me full chance and opportunities for practical application of skills.

2.1.1 First Week: My first day was introduction day. I was introducing to banking language, as every
bank has its own dealing system. Most of the banks dont rely on manual work they use the current
electronic system and feed all the data in computer, they rely on paperless exchange work but ZTBL rely
on both manual as well as online computer system. At my first day of internship I come to know that
first computer was introduce in ZTBL Bank among other banks of Pakistan. I have worked in branch,
the parts where all cash activities are controlled. The main reason why this bank is working manually is
most of people come from rural areas they do not understand computer system due to lack of education,
so its their need. They want everything in written form whether they take loan or want to submit money
in the bank. The people from rural areas are not much satisfied from online system they always need
evidence of their whole past record manually, so first day I come to know that history of the bank and
about Vouchers. It was a steep learning curve but nevertheless an enjoyable one. Vouchers are of three
types DC voucher known as Debit Voucher. Second type of voucher is CC voucher known as Credit
Voucher known as Transfer Voucher.
Debit Voucher contain three copies, one copy is for cashier, one copy is computer copy that is needed
for the record in computer, and third copy is given to the person who is going to submit money in the
bank, when a person is going to submit money in the form of loan, or going to submit the cash in his
account it mean bank is receiving its recovery through this procedure. Credit Voucher has two copies
one is for cashier and one is computer copy. Transfer Voucher contains two copies one is computer
copy and one is for another branch to which advice is originating or responding. I have learned to feed
vouchers manually.

2.1.2 Second week: I come to know about advice, we will take four copies of advice , two copies are
for another branch to whom we are requesting to respond to us or we are originating. One copy is for
ZTBL bank which will store as a record and one is given to the person who submitted money in the
bank. I come to know different type of things for instance, a person belongs to Khairpur but due to some
reasons he cannot able to submit their so he submit money in Bahawalpur Branch so we make advice for
Khairpur branch mentioning their branch code, A/C no and request them to respond and same if a person
belongs to BWP but due to some reason he is not able to submit money in Bahawalpur branch so advice
will be originate. I have done some work in Microsoft as well. I also worked in dispatching system.
Main purpose of this system is to keep record of all incoming and outgoing letters, emails, and
applications. These letters are circulated inside (between departments and units) and outside
organization (stake holders and suppliers). For this purpose using MS Office Master File is produced
in which detail about letter received (receiving date from whom letter is received and who to forward
with date) and then detail about letter Delivery (delivered date and name of department or person where
it has to be delivered). A copy of letter is attached in hard form in Master file. Another record is
maintained side by side called Employee Diary, in this the record of sender and receiver is kept.

2.1.3 Third Week: Again same vouchers and advices work repeated just to make me kind of expert
in this work, I have done a lot of manual work. If advice is credit than we have to debit in transfer
voucher same case is with debit advice. Vouchers consist of Advice no, G.L head (general ledger) we
have to mention Branch code date, Contra date as well. I have done work on ledgers where we have to
tally the balance the past closing outstanding must be equal to present starting. Here I come to know that
ZTBL bank dont have permission to have current cash more than 10 lac so they have an account in
HBL (Habib bank Limited) other banks have an account in National Bank. HBL is giving profit as well
to this bank. And I come to know different type of websites that the bank is using as online feeding the
data. Two main systems are:
CBAS (Centralized Branch Automation System).
CDMS (Centralized Deposit Management System).
In CBAS we feed all the vouchers and in CDMS all the cheques, and all the new accounts that are
opened are feeded online. I have learned how to open an account , how I have to fill the form first, the

form consist of persons personal information like CNIC number, Address number , Phone number his,
Kin information and amount of initial deposit.

2.1.4 Fourth Week: I have learned Scanning; every loanee has a separate file that we have to scan.
There are specific pages of loanee which will be scan like:

Cover page (CP)

Disbursement Authorization and Payment Order Sheet ( DAO)
Documentation Checklist/ Tickler (CL)
Loan Application (LA1)
Loan Application (LA2)
Loan Application (LA3)
Loan Application (LA4)
Sanction Order (SO)
Pass Book (PB)
Agreement (AGR1)
Agreement (AGR2)
Sanction Letter (SANCLTR1)
Sanction Letter (SANCLTR2)
TBS144
Mutation (MUT)

For new case we have to scan Pass Book just first three page because Loan Case no is not given
certificate of creation of change (CCC).Basically we scan files because if the record of Loanee
misplaces or other situation held than we have the record of files and the record of files are always
transfer to Head Office Branch Islamabad.

2.1.5 Fifth Week: I have learned to use CBAS system (Centralized Branch Automation System).
In CBAS system we feed all the vouchers firstly we save the voucher than submit and authorize. Debit
voucher, Credit voucher or Transfer voucher with simple entry enter inter in J.V transaction. TR codes
are 01, 02, 03. If TR code is 02 than its contra is 011. If TR code is 03 than its contra code will always
be given in voucher. Debit voucher start from 9 is recovery voucher. Transfer voucher with G.L head 9 is
for disbursement. Transfer vouchers that are not start from G.L head 9,6 or something else feed in J,V
transaction pending inter branch. G.L head starts from 7 are for bank income. G.L head start from 8 is
for expenses. Here I come to know different types of cheques used in ZTBL. Cheques are always debit.
Slips are always Credit.
10

Types of checks
1. Current Account Cheque
2. Saving Account Cheque
Saving account cheque has further types:
2.1: PLS (Profit and Lose Sharing Account)
2.2: RBA (Rozana Bacaht Account)

2.3 BBA (Business Banking Account)

3: NIFT Clearing Check:
If a check of ZTBL submitted to another bank than after clearance with the help of transaction, no
physical cash exist the cash will be debit with general ledger head of (3504). If another bank submits
cheque to ZTBL bank than after clearance with the help of transaction, no physical cash exist the cheque
will be credit with G.L head 6399. RBA % depend on deposit amount like 4.80 is for (10000-50000),
5.20 is for (50000-150000), 5.80 is for above 150000.
4: Barrier Cheque: Physical cash involve.
5: Cross Cheque: Account to account transaction.
ATM Cards:
Types:
Silver: you are allowed to withdraw 40000 in a day.
Golden: you are allowed to withdraw 50000 in a day.
From Silver card if you want to withdraw money two times in a day, so you can withdraw 20000-20000
in each period same as from Golden card if you want to withdraw money two times in a day, so you can
withdraw 25000-25000 in each period. 15 rupees will be deducting if you are not going to withdraw
money from your bank branch. We can withdraw money from ATM at Sunday as well so the transaction
date will be written as Monday date. If a person withdraw 50000 on Sunday and 50000 on Monday than
he will have to pay 1 lac tax. The order software used in ZTBL are ICRMS, NIVS, CIRS, IMIS.
11

ICRMS: (Internal Credit Risk Management System) in which we manage the risk while opening the
account. Risk in sense that a person dont have CNIC and we are going to open his/her account without
proper information so we are taking risk. Its a basic documentation
NIVS: (National Identity Verification System) this system helps to validate the CNIC of a customer,
his name, gender, family number, CNIC issue and expiry date.
CIR: (Customer Investigation Report) this system is used for customer verification, his bio-data,
occupation, business etc.
IMIS: (Interactive Management Information System) in formation of CBAS and CDMS collected
from IMIS. We can collect information of recovery, recover schedule and recoverable things.

2.1.6 Sixth Week: I have learned to use CDMS (Centralized Deposit Management System).
Firstly we have to open account in it than debit and credit procedure will held otherwise system will not
allowed to process anything. 1: Fill the profile data and then give the CDMS number which is account
number than save and authorize. 2: open head customer account and than its sub head person give all the
information required like Account Information, Account No, Introduction Type, and Currency. Service
of other bank ( Person have an account in other bank or not), Old Account No, Title, Withdraw limit,
Address limit, Correspondence Address (Back side of CNIC).3: customer signature is necessary to scan
otherwise account will not be open so scan the signature card save and query, view sign image, add sign
image and than save and authorize.
Than go in transaction head than its sub head local there will given three head Cash Payment, Cash
Receipt, Transfers

Cash Payment is for cheque.

Cash Receipt is for slip.
Transfer is for Transfer Voucher.

For opening an account slip is necessary person have to deposit some as well, Cheque cash are always
withdraw and Slip cash are always deposit.
Transfer may be debit or credit. Cross cheque is debit transfer. Loan payments we make loanee files than
we make TV voucher and amount in it, the person give his check to cashier and all the amount of his
loan will be added to his account and this is credit transfer. Than we have to go in head Administrator its
12

sub head period process it, if new file is made than there is withholding tax than we have to go todays
pending deduction, we have to fill it than authorize day will end. If files are not made than there is no
withholding tax we simply process authorize and day will end. Before we go to Administrator we will go
in reports than in Sub GL Summary, in report give G.L Head 2101 current account there will given all
the debit and credit balance of the day, than we go in withholding tax that will added in debit amount,
than we will telly all the debit and credit transaction with CBAS than day transaction will be end and on
next day same procedure will be repeated.

Drafts: Draft will always credit. Draft sending procedure:

Code of branch (84)
Code of day (48)
Code of draft amount (48)
Code of currency (16)
Table of paying name code eg, a person name is zawar code of Z we put in it (68)
Code of date (71)
From where we send c eg, we are sending code from BWP so we put code of this branch (45)
At the end we will add all the codes and there total sum (445) is called draft code which will be written
in check.

13

Chapter 3 Analysis
Non- Financial Analysis:
3.1 PEST Analysis:
Political: Pakistan is despite all international and public perceptions, today is a functioning democracy
and gradually there is a change in complexion and composition of legislatures with more educated
people and human (27% of national assembly and 17% of senate) entry into politics. Similarly it helps in
designing best strategies to implement that could support the revival of Bank industry. Like in the era of
nationalization bank had to suffer as other industry thats why the impact is still found in the
performance of this industry.
Economical: Although banking sector development is important at the early stage of economic growth
general liberalization presuming in homogenous bank role may not necessarily promote growth. The
estimated cost structure indicates that state-owned commercial banks are large enough, while
development financial situations and private banks can expect to obtain cost-saving advantages by
expanding their operations. Since scope economies are significant, portfolio diversification generally
increases bank profit. In addition privatized banks are most efficient, followed by foreign private banks
public banks are the least efficient.
Social: Banks always help people in improvement of living condition of poor people in various forms
like giving loans to poor for starting business or directly providing them the instruments that could
enhance their living conditions. Similarly ZTBL always tried to provide the needy people wants on soft
terms and also help to eradicate unemployment by providing job opportunities recent high growth trend
coupled with enhance spending on social and 2007-2008 has together begun to pay some dividends.
Technological:

There is Inadequate communication infrastructure

Smaller and lowest computer facilities.
Inadequate IT training.
There must be an IT departartment.

14

3.2 Marketing Analysis:

Marketing is a process of managing the performance of businessactivities designed to plan product, pric
e and promote; in order to achieveorganizational objectives. Though it sounds simple, the actual practice
poses many challenges. The marketing analysis of any organization plays a vital role in directing its
future direction. A good marketing analysis can give new heights, whereas a poorly designed analysis
can prove to be disastrous. However, the marketing is based on the customers satisfaction through its
value added products and services. The ZTBL regularly use different methods of marketing in order to
aware and attract customers regarding their products and services. The marketing analysis is done by
using various methods used by the ZTBL, which is briefly explained as under;
1. Print Media Advertisement: ZTBL give different advertisement regarding their products and
services, in order to attract large number of customers from time to time in the newspapers.
2 .The 4ps: The 4Ps means the product, price, and place & promote. The ZTBL can use 4Ps regularly
in order to attract large numbers of customers, by proving lot of products and services.
2.1 Product: The ZTBL strategy is offer most comprehensive portfolios of personalized financial
solutions that are customer tailored to serve the requirements of customer.
2.2 Price: The ZTBL follows the strategy of low margins, high volume with its low mark up and easy
repayment schedule it tends to be more attractive even for consumers with less money.
2.3 Promotion: The ZTBL effectively advertises its services and product using the through broachers,
book let magazines and low margin on loan is also the base of promotion.
2.4 Placement: With a wide network of ZTBL the bank operates through 25zonal offices with 342
branches under them with over 1250 agriculture graduates known as MCO.
3. Internet and Electronic Media Advertisement: The ZTBL consistently give information regarding
their products and services on the internet and also give commercials on the television for awareness and
attracting the large number customers.
4.

Brochures:

They

have

designed

different

brochures

for

each

for each product; these are given to customers for information and attraction purposes.

15

department

and

5. Sports Sponsorship: The ZTBL can sponsor different sports promotion activities on television and
radio like Cricket, Hockey.etc.

3.3 Competitors:

United Bank Limited

National Bank of Pakistan

3.3.2 Comparison between ZTBL and UBL Loan Schemes:

United bank credit limit is 30,000, and give loan of 18 months for sugar cane. Loan
tenure is for 3 months to three years. Whereas ZTBL loan tenure is for 5 years or more.
ZTBL per Acre credit limits are:
Major Crops:
Crop Name
Rice
Maize
Wheat

Credit Limit Per acre

19,000
20,000
16,000

Minor Crops:
Crop Name
Gram
Garlic
Soya Bean
Tomato
Tobacco
Ginger
Sugar Beet
Bajra

Credit Limit per acre

11,000
26,000
12000
19,000
29,000
30,000
12000
11,000

3.4 SWOT ANALYSIS

Strengths

16

It provides the loan at cheaper interest rate as compare to the other Banks.

In Pakistan, majority of the farmers is poor thats why farmers are required to get
loan from the bank so ZTBL has a very vast market to operate in.

ZTBL gets most of the funds from different developmental institutions

i n c l u d i n g Government, ADP, and SBP etc. so in case of bad debts the bank wont
have to suffer a lot.

It is affiliated with different research institutions and it has all sort of ag

r i c u l t u r a l machines and technology so it can easily achieve its aim which is the
development of agriculture in Pakistan.

ZTBL has a staff college for the training of its employees in Islamabad, through
proper training more efficient team of employees can be made which shall be beneficial in
tough banking competition.

One of the core competency of the bank is MCOs because ZTBL is the only
bank w h i c h h a s a t e a m o f h i g h l y e x p e r i e n c e d a n d p r o p e r l y t r a i n e d M C O s
w h o c a n e a s i l y disburse loan and can achieve recovery target quickly hence risk of bad debts
is reduced.

Through different computer softwares data is kept and maintained. Some

o f t h e s e softwares are CFOCS, DMS, MIS, and HRIS etc.

ZTBL has no competitors in the market, some banks started lending

f a c i l i t y f o r a g r o business but due to lack of efficient team of MCOs those banks had to
suffer heavy loss.

17

The farmers have a trust on ZTBL because of its operations and the behavior of
mobile credit officers.

Audit zone performing its job in a better way to rectify the errors and fraud cases

18

Weaknesses

Sometimes the lending is done on political basis. Due to the influence of political leaders the
recovery system is affected which leads to bad debts.

The bank has no treasury department due to which funds are not being properly
utilized and the bank is missing a great opportunity to earn profit.

There is exuberance of old, non technical and uneducated employees in ZTBL.

These employees are promoted to senior level management on the basis of seniority
due to which performance is affected.

Some cases of nepotism are often seen in the bank when loans are given by the
branch managers to their relatives and fake data is maintained.

Most of the employees even seniors managers are computer illiterate. They can
even check their emails properly. So IT implementation seems to be failed in the bank due to
rigid attitude of employees because they are not adaptable to change.

They are lacking of banking online system.

Opportunities

By utilizing the efficient team of MCOs the bank can have heavy amount of deposits.

19

The bank can set up its treasury department in Karachi for proper utilization of the funds and for
maximum profit earning.

The bank can reduce its expenses by laying-off non performing employees.

The bank has a good reputation in the market and its employees are highly trained
for agriculture business development planning so it can also operate in Middle East
because the Arabs are now focusing on agriculture.

ZTBL can become a leading commercial bank by slightly changing its

c u l t u r e . I t i s already equipped with highly experienced bank officers.

Threats

As the economy situation is very bad and the country is facing liquidity crunch
thats why ZTBL may have to face difficulty in getting funds.

In order to overcome the liquidity problem the bank has started operating in
commercial banking market but due to inefficient commercial banking practices
ZTBL may have to face a severe situation.

The climate of the earth is rapidly changing due to which heavy rains and floods are often
anticipated. This is an alarming situation for ZTBL to operate in the market being an agriculture
lender.

The bank has a very small profit margin because it gets funds from SBP
a t 6 % a n d provides funds to the farmers at 8% only.
20

Agricultural crop rate decreasing each year

3.5 Financial Analysis

Ratio Analysis:
3.5.1 Liquidity Ratios
3.5.1.1 Current Ratio:
Years
2014
2015

Current Ratio
1.3
1.7

Interpretation of Current Ratio: If we interpret the current ratio of the ZTBL, it is slowly increasing
from 2014 to 2015. The current ratio in 2014 lower than the year 2015 which is 1.3 which means that the
bank is able to pay the current liabilities. However the higher the current ratio, the more the bank is
considered to be liquid in order to satisfy short term obligation.

3.5.1.2 Quick Ratio:

Years
2014
2015

Quick Ratio
0.26
0.37

Interpretation of Quick Ratio: If we interpret Quick ratio of ZTBL, it is higher in 2015 than in 2014.
For the organization, the quick ratio cannot provides a better measure of overall liquidity only when a
firms inventory cannot be converted into cash, because short term investment is better in 2015.

3.5.1.3 Net Working Capital:

Years

Net Working Capital

21

2014
2015

38931238
79211448

Interpretation of Net Working Capital: The NWC of ZTBL from 2014 to 2015 is increasing gradually
and has positive working capital and considering favorable because the total current assets are greater
than total current liabilities and the bank is better able to pay its short term obligation as they become
due. On the other hand if total current assets are lower than current liabilities the firm has negative
working capital and considering unfavorable. In this case the bank is not able to pay its short term
obligation as they become due.

3.5.2 Leverage Ratio

3.5.2.1 Debt Ratio:
Years
2014
2015

Debt Ratio
0.8
0.6

Interpretation of Debt Ratio: The debt ratio of ZTBL in 2014 is 0.8 and 0.6 in 2015 that gradually
decreases. The high the ratio the more the bank is risky and having more leveraged. While low ratio will
leads a firm less risky and having less leveraged.

22

3.5.2.2 Total Debt to Net worth Ratio:

Years
2014
2015

Total Debt to Net worth Ratio

3.2%
1.36%

Interpretation of Total Debt to Net worth Ratio: If we interpret the debt to net worth ratio of ZTBL, it
is gradually decreasing from 2014 to 2015. The debts to net worth ratio is greater from the rest of the
year which is 3.20 in 2014 and lower in 2015 which is 1.36 and considered to be favorable from the rest
of the years. The higher the debt to net worth ratio, greater will be the business is considered to be risky
and consider being favorable. The lower the debt lower will be the business is considered to be risky and
consider to be favorable. The high leverage usually indicates the business has a lot of risk because it
must meet principal and interest on its obligations.

3.5.3 Profitability Ratios

3.5.3.1 Return On Assets (ROA):
Years
2014
2015

Return On Assets (ROA)

0.016%
0.021%

Interpretation of Return on Assets (ROA): The ROA is gradually increasing from 2014 to 2015 due to
increase in the total amount of the assets and total income. The ROA in 2014 is lower than 2015 which is
0.016 that shows a bank can earn less money on more investment. The higher the ROA ratio shows that
the bank has efficiently managed its assets portfolio to earn a more money on total assets, achieving
economic efficiency and more opportunities of financing in the year 2015 as compared to the rest of the
year.

23

3.5.3.2 Return on Equity:

Years
2014
2015

Return on Equity
0.101
0.108

Interpretation of Return on Equity: The ROE gradually increases in the amount of total income and
stock holders equity. The highest ROE indicates that bank can earn a high return on less equity is
generating cash internally. The higher the ROE ratio, the greater will be the opportunity to earn high
return and consider to be favorable while lower the ROE ratio, the lower will be the opportunities to
earn low return and consider to be unfavorable.

24

Chapter 4 Conclusion & Recommendations

4.1 Conclusion:
The main purpose of internship is to develop and strength in the student educational and career
preparation. I did my internship in ZTBL. My internship goals included completing the report assigned
to me, learning about the ZTBL which is public limited company and also developing positive
relationship with employees. Some of my activities as an internee post in ZTBL was to coordinate with
employees, working on my giving task, performing full concentration and preparation of my internship
reports. So an internship is an opportunity to gain professional experience doing the work of an
employee in your career area of interest. Ideally, this experience allows me to try out many expects on
the job and to apply skills learned in the classroom environment. An internship is an experience where
students learn by taking responsible roles as worker in organization and observing and reflecting on
what happens while they are in the working condition.
The Zarai Taraqiti Bank provides loan, production seasonal loans items and have runed many schemes
like supervised agriculture scheme,Zarkhaiz (one window operation), Sada Bahar scheme, tea financing
scheme, crop maximization project etc.the Zarai Taraqiati Bankk Limited has also some problems thet
needed to be solve some are:
Loan facilities is not based on merit system, it is rather based on favoritism. There is a problem in ZTBL
that corruption of revenue department cause the great influence in its performance. Govt. influence also
effect the performance of ZTBL, as Govt. influences the bank provide loan who has Government favor.
This may cause some bad effects as they are not eligible for loan. The Asian Development Bank aid for
ZTBL now they hasnt enough source to provide much loans due to market values for agriculture
farmers are willing to leave this field because they dont get enough revenues. Employees and managers
are very corporative ZTBL act as a financial source for small group of farmers and tenants.
They invest in different fields like input, tractors, fishery and dairy farms according to area. They
provide service at a very good makeup. Overall ZTBL is a good financial institution but its main
problem is corruption in revenue department. ZTBL has a aim to facilitate the farmer. It is a Government

25

Financial Institution which is nonprofit organization. They are going to commercialized to extent their
facility.

26

4.2 Recommendations:

ZTBL should improve the Management system. They should be employee and customer

oriented.
They should adopt the new agriculture technology for the high level production to

increase the GDP level of the country.

Political involvement should be eliminated so that they can take good decision and

actions for the better disbursement.

ZTBL Head Office has to update the annual reports and manuals annually.
Their employees should have knowledge about their organization and about its

department where they are working.

In order to increase cooperation among employees, management has to arrange different

parties and get together which will create love, care and corporation among employees.
They should introduce online banking.
Employees should be qualified and productive.
ZTBL has to play vital role for introducing new energies to overcome the problems of the

fuel and bio gas.

Marketing department should play vital role for introducing new products.
They should also play role for advertise their products and features and functions of the

products.
Their employees should have knowledge about their organization and about its
department where they are working.

27

4.3 ANNEXTURES
1)

Income Statement for the Year Ended December 31, 2015

2015

2014

.Rupees in000
Mark-up / return/ interest earned ..

18,284,436

15,522,130

Mark-up/ return/ interest expense.

6,013,775

2,398,270

Net mark-up/ interest income12,270,661

13,123,860

Provision for diminution in the value of investment net..

Reversal/ provision against non-performing loans

(573,110)

and advances net

Impairment in the value of investment.
Write offs under relief packages.

160,009
-

1,381,324
113,663
-

Bad debts written off directly.

(413,101)

Net mark-up/ interest income after provision..12,683,762

28

1,494,987

11,628,873

NON MARK-UP/ INTEREST INCOME

Fee, commission and broke age income.

40,919

28,648

Dividend income .

81,805

68,116

Income from trading in government securities

Income from dealing in foreign currencies.

Gain on sale of securities.

366,437

118,414

Unrealized gain on revaluation of investments

classified as held for trading

Other income

5,086,001

4,484,707

Total mark-up/ interest income

5,575,162

4,484,707

18,258,924

16,113,580

Administrative expenses.

9,706,358

7,730,765

Provision/ (reversal) against other assets-net..

34,936

(10,666)

NON MARK-UP/ INTEREST EXPENSES

Other charges 23,974

11,099

Total non-mark-up/ interest expenses.

9,765,268

7,731,198

8,493,656

8,382,382

29

EXTRA ORDINARY/ UN USUAL ITEMS

PROFIT BEFORE TAXATION8,493,656

8,382,382

Taxation- current year.. 2,311,747

3,003,990

- Prior year 361,408

4,263

- Deferred 477,391

(82,153)

__________________________
3,150,546

2,926,100

__________________________
PROFIT AFTER TAXATION..

5,343,110

5,456,282

UN appropriate profit brought forward..

14,742,303

13,758,929

Profit available for the appropriation 2, 054,13

19,215,211

Basic earnings per share (rupees).4.267

4.357

Diluted earnings per share (rupees) 4.267

4.357

30

2)

Analysis of Balance Sheet as At December 31, 2015

2015

2014

.Rupees in000
ASSESTS
Cash and balances with treasury banks. 2,516,338

4102,133

Balances with other banks. 16,408,511

5982441

Lendings to financial institutions

820190

Investments 19,765,649

29337315

Advances 129,552,744

108553,958

Operating fixed assets 2,101,177

1581077

Deferred tax assets- net.. 446,941

1528,810

Other assets- net 16,782,760

11656953

Total assets..187,574,120

163,562877

Liabilities and equity

Bills payable. 346,059

561964

Borrowing. 57,143,100

969349

Deposits and other accounts. 35,947,953

26701,911

Subordinated loans .. 3,204,323

Liabilities against assets

31

Subject to finance lease

Deferred tax liabilities- net..

Other liabilities ... 11,721,237

Total liabilities 108,362,672

10698014

38,931238

Share capital / head office capital amount. 12,522,441

12,522,441

Reserves..

5,644,569

4590,136

UN appropriate /remitted profit/(losses). 14,553,175

Minority interest...................................

Total equity....36,884,029

18,716,929
20393752

Share deposit money 40,155,992

89,490,985

Surplus on revaluation. 2,171,427

3474903

Total liabilities and equity 187,574,120

32

163,562,877

Cash flow statement for the year ended December 31, 2015.

2015

2014

. Rupees in000
Cash flows from operating activities
Operating profit before working capital changes.. 14,021,725

9,548,477

(Increase)/ decrease in operating assets:

Lending to financial institution.. 820,190

2,826,526

Advances- net. (20,585,685)

(14,737,229)

Other assets-net.. (4,197,435)

(2,171,452)

(23,962,930)

(14,082,155)

(Increase)/ decrease in operating liabilities:

Bills payable

(215,905)

(144,301)

Borrowings 4,916,538

(2,948,341)

Deposits and other account.. 9,173,057

11,798,074

Other liabilities

(321,779)

13,551,911

33

1,316,766

10,022,198

Employees benefit..

(278,764)

Income tax paid. .. (3,048,572)

Net cash generated from the operating activities.283,370

(414,036)
(2,611,850)

2,462,634

Cash Flows from Investing Activities

Net investments in available for sales securities. 9,892,448

(14,518,583)

Net investments in held to maturity securities (634,367)

9,789,148

Dividend income

68,116

81,805

Investments in operating fixed assets.. (830,335)

(465,209)

Sale proceeds of property and equipment deposed off..

70,764

61,169

Net cash generated from/ (used in) investing activities..8,570,720

(5,055,764)

Cash Flows from Financing Activities

Net increase/ (decrease) in cash and cash equivalent. 8,854,090

(2,593,130)

Cash and cash equivalent at the beginning of the year..

12,998,076

10,404,946

Cash and cash equivalent at the end of the year19,259,036

34

10,404,946

References
http://www.ztbl.com.pk/AboutUs.aspx

https://en.wikipedia.org/wiki/Zarai_Taraqiati_Bank_Limited

http://www.ztbl.com.pk/PublicDocument.aspx

http://www.pakistantoday.com.pk/tag/ztbl/

http://www.ztbl.com.pk/RptAnnual2014.aspx

http://www.ztbl.com.pk/Documents/Publication/annualReports/AnnualReport2015/D_CONSOLIDATE
D_FINANCIAL_STATEMENT.pdf

[ 7 ] S a e e d , M N a s i r. ( 2 0 0 7 ) M o n e y B a n k i n g & F i n a n c e I m t i a z B o o k d e p o t , K h a l i d
Plaza, Urdu Bazar Lahore

[8] Klein, John F. (1998) Money and the Economy, Mc Grath Hill, New York

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