Organizational Structure of bank of khyber

Chapter – 3 “Organizational Structure of BOK” CHAPTER – 3 ORGANIZATIONAL STRUCTURE OF BOK

3.1 ORGANIZATIONAL HIERARCHY CHART OF BOK: The channels that delegate these activities are called organization hierarchy. This must be set in such a manner to best accomplish the organizational goals. Bank of Khyber is one of the modern organizations; a competent staff is managing it. It is a centralized organization and the authority flows from top to bottom. Bank of Khyber has been entrusted to the Board of Directors. The Board consists of six directors comprising five directors nominated by the Government of Khyber Pakhtunkhwa. “ORGANIZATIONAL HIERARCHY CHART” Organization

Board of Directors

Managing Director Long Term Projects Resident Directors AUDIT Managing Committee Banking Operation Division

Personnel & Establishment Division

Branch Operations Department

Investment Department

Information Technology Deptt

Accounts & Treasury Department

Risk Management Division

International Banking Department

Human Resource Department

Credit Department

Public Relation Department

Assets Management Department

Marketing Department

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Chapter – 3 “Organizational Structure of BOK” 3.1.1 CORPORATE INFORMATION OF BOK: i.

CHAIRMAN: 

ii.

Mr. Attaullah Khan

MANAGING DIRECTOR / CHIEF EXECTIVE OFFICER: 

iii.

Mr. Bilal Mustafa

BOARD OF DIRECTORS:



Mir Javed Hashmat

(Executive Director)



Sahibzada Saeed Ahmad

(Director)



Mr. Muhammad Asif

(Director)



Mr. Muhammad Maqsood Khan

(Director)



Mr. Maqsood Ismail

(Director)



Mr. Amjad Pervez

(Director)

iv.

AUDIT COMMITTEE: 

Muhammad Asif



Sahibzada Saeed Ahmad



Muhammad Maqsood Khan



Mir Javed Hashmat



Amjad Pervez

v.

(Chairman)

CHIEF FINANCIAL OFFICER: 

vi.

Rahat Gul

COMPANY SECRETARY: 

vii.

Zahid Sahibzada

AUDITORS: 

Deloitte M. Yousuf Adil Saleem & Co. Chartered Accountants

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Chapter – 3 “Organizational Structure of BOK” viii.

LEGAL ADVISORS: Mr. Nisar Ahmed Khan Advocate, Peshawar



M/s. Mohsin Tayebaly & Co., Karachi

ix.



REGISTERED OFFICE / HEAD OFFICE: The Bank of Khyber 24, The Mall Peshawar Cantt. UAN# 00-92-91-111 95 95 95, URL: www.bok.com.pk

x.

REGISTRAR & SHARE REGISTRATION OFFICE: THK Associates (Pvt) Ltd Ground Floor, State Life Building No. 3 Dr. Ziauddin Ahmed Road Karachi – 75530. Pakistan.

3.2 NUMBER OF EMPLOYEES IN BANK OF KHYBER: Bank is service oriented organization which need more professional and skillful people, the Bank of Khyber is also managed by experienced and well qualified team of professional that is lead by a distinguished banker of the country. The bank provides them with on the job training.

Employees/Years

2011

2010

2009

Permanent

805

795

637

Contractual Based

442

398

119

Daily Wagers

11

5

6

1258

1198

762

Total

3.3 MAIN OFFICE OF BANK OF KHYBER: The Bank of Khyber 24, The Mall Peshawar Cantt. UAN# 00-92-91-111 95 95 95, URL: www.bok.com.pk

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Chapter – 3 “Organizational Structure of BOK” 3.4 INTRODUCTION OF THE DEPARTMENT BOK (IBB) SWABI BRANCH: The Operation (General Banking) Department of Bank of Khyber IBB Swabi Branch consists of the following Sub-Departments: 1) Deposit Department. 2) Cash Department. 3) Accounts Department. 4) Remittances Department. 5) Clearing Department. 6) Bills Department. 7) Information Technology Department.

3.4.1

DEPOSIT DEPARTMENT: This department deals with retail banking i.e. opening customers accounts

without opening an account customer cannot operate in the bank. Once the account is opened relationship between customer and bank is created. Procedure for opening an account: A person, who wants to open any kind of account, has to fill in a printed form which is provided by the bank, free of cost. Separate account opening forms are used for different types of accounts. Bank usually requires that new depositor must be introduced by someone. An introducer can be any person known to the bank but preferably it should be a customer of the bank. However, the manager can open the account by his own introduction. If the manager is satisfied, it will obtain the full signature of the customer- on the form and specimen signature card, makes the first deposit, and issues the cheque book. The following are given to the customers: Pay-in-slip is the proof of deposit. For every payment which is to be deposited in the bank, the pay-in-slip is to be filled up. The object of this book is to provide the customer with the bank's acknowledgment for receipt of money to be credited this account. Cheque Book contains a number of cheques. It enables a customer to make withdrawal from this account or make payment of various parties by issue of cheque. 14

Chapter – 3 “Organizational Structure of BOK” Pass Book is a copy of the customer’s account as appears in the books of the bank. Balance is recorded in this book by the Clerk. Documents: I.

Copy of Computerized National Identity Card

II.

Two attested photographs to be obtained for pasting on AOF and other on Specimen Signature Card.

III.

Thumb Impressions Male -------- Left Hand Thumb Impression. Female ------Right Hand Thumb Impression.

3.4.2 CASH DEPARTMENT: Cash department most bank prohibit this area for all type of customer and even for the other departments employee, similarly the internees are also not allowed. However the main functions of this department are cash payments and cash receipts that are briefly described below: 

Cash Receipts: Receipt of cash from the customers by the bank in case of deposits, issuance of demand draft and telegraphic transfer or payment of fees etc. is the function of this department. A record is also maintained for these receipts.



Cash Payments: Along with the receipt of cash for different transactions, this department also performs the function of payment of cash, for example, when a customer withdraws cash from his account, etc

3.4.3 ACCOUNTS DEPARTMENT: This department is responsible to keep the record of each and every transaction and prepare reports about the amount of deposits and advances and sent to Head office or State Bank of Pakistan on monthly, quarterly and yearly basis. The accounts department deals with various routine activities for the bank. The main activities performed by it are:a) Budgeting b) Reporting c) Maintenance & depreciation of fixed assets d) Miscellaneous functions 15

Chapter – 3 “Organizational Structure of BOK” Budgeting: Accounts department of a bank, for a year makes budget of every branch. Fiscal year of bank starts from July 01 and ends on June 30.

Reporting: The accounts department, in the form of reports, clubs the details of various departments together. Each and every minute detail is provided in weekly, monthly and annual reports. The reports are submitted to head office, SBP and to the government. The accounts department prepares many reports, of which the most common are:I.

Statement of Affairs

II.

Income & Expenditure Report

III.

Business Report

IV.

SBP Report

V.

Outstand Receipt Report

VI.

Currency Wise Deposits Report

VII.

Maintaining of Fixed Assets & their Depreciation Accounts department maintains the record of all the assets and charges

depreciation on them. The bank normally uses the straight-line method to compute the depreciation. It is calculated on monthly basis and charged yearly. Bank not only depreciates the existing assets but also the assets but also the assets transferred in and transferred out.

3.4.4 REMITTANCES DEPARTMENT: THE BANK OF KHYBER (IBB) Swabi Branch also provides the facility of transfer of funds from one bank to other and from one place to another place. The transfer of funds is mainly the responsibility of the remittances department. The transfer of funds as well as the receipts from other branches of the bank is the basic responsibility of remittances department. 

Outward Remittances: When the bank sends a Telegram, Mail and Demand Draft to another bank (concerned branch) for payment to the customer, it is called outward remittance. The customer pays charges on the bank counter. 16

Chapter – 3 “Organizational Structure of BOK” The sender is required to apply through a form in which he will give all the necessary details about the sender and beneficiary. The signature of the customer is verified and relevant document is attached as per exchange control regulations. 

Inward Remittances: When Telegram, Mail and Demand Draft are drawn on the Bank of Khyber, it is called inward remittance. Bank charges withholding tax and commission according to the rates specified in the schedule of bank charges. At the Bank of Khyber (IBB) Swabi remittances are made in the following manners.

In the remittances department there are different transfer types that are given bellow: i. Mail transfer ii. Demand Drafts (D.D’s) iii. Telegraphic transfer iv. Pay order v. Call deposit Demand Draft: 

Demand draft is a written order drawn by a branch of a bank upon the branch of same or any other bank to pay certain sum of money to or to the order of specified person



Demand draft is a negotiable instrument.



Legal provisions are same as that of cheque.



It is to be ensured that purchaser can at least sign.



Thumb expression is not accepted on DD



These parties are involved: purchaser, Issuing Branch, Drawer Branch and Payee



A demand draft may be issued against the written request of the customer before issuing it must be seen that the demand draft is in order.

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Chapter – 3 “Organizational Structure of BOK” Telegraphic Transfer: 

Transfer of funds from one branch to another branch of the same bank or upon other bank under special arrangements.



Telegraphic transfer is not negotiable



The funds are not payable to bearer



Minor cannot avail this facility



These parties are involved: Applicant, Drawing branch, Drawer branch and Beneficiary.



Full name of the beneficiary or account number should be mentioned in the application form.



Instruction regarding mode of payment should be obtained.



A record in the remittance outward register should be maintained.



All the remittance must be controlled through number.

Mail Transfer: 

Transfer of funds from one branch to another branch of the same bank within or outside the city is called mail transfer.



Mail transfer is not negotiable



The procedure is same as for DD. All precautions must be observed.

Pay Orders: 

Pay order is meant for bank own payment but in practice they are also issued to customers.



A pay order is written authorization for payment made in a receipt form issued and payable by the bank. To the person named and address.



These parties are involved: purchaser, issuing branch and payee.



Charges must be recovered at prescribed rate.



Pay order should be prepared like demand draft.



A record of all issued and paid should be maintained.



Credit voucher should be prepared.

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Chapter – 3 “Organizational Structure of BOK” Call Deposit: It is highly liquid instrument; it can be cashed at any time when needed. This instrument bears no profit on it. It is mostly used for the purpose of tenders.

3.4.5 CLEARING DEPARTMENT: Clearing-house, the general term for a central institution employed in connection with large and interrelated businesses for the purpose of facilitating the settlement of accounts. Clearing Department keeps clearing register regarding clearing house which consists two types of entries: I.

Inward Clearing: Inward clearing means record of all those cheques which are being received by the bank in first clearing. All details of cheques are recorded in clearing register.

II.

Outward Clearing: Outward clearing means the detail of cheques that bank has delivered to other banks in first clearing. Details of cheques are recorded in the clearing register. 

Nift:

It

is

the

abbreviation

of

“NATIONAL

INSTITUITIONAL

FACILITATING TECHNOLOGY”. It is an intermediate party who facilitates banks in clearing. Almost all banks have contract with it. 

Instruments to Be Presented are Cheques, Demand Drafts and Pay Orders.

Types of Cheques Collected 

Transfer Cheques: Those cheques, which are collected and paid by the same branch of bank.



Transfer Delivery Cheques: Those cheques, which are collected and paid by two different branches of the same bank situated in the same city.



Clearing Cheques: Those cheques, which are drawn on the branches of some other bank of the same city or of the same area, which is covered by a particular clearing house.



Collection Cheques: Those cheques, which are drawn on the branches of either the same bank or of another bank, but those branches, are not in the same city or they are not the members of clearing house.

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Chapter – 3 “Organizational Structure of BOK” 3.4.6 BILLS DEPARTMENT: The Bills Department deals with the collection, purchase and discounting of bills on behalf of the customers. The collection of cheques and other instruments has become a very important service the commercial banks render to their clients. While collecting cheques and other and other instruments, a bank acts as an agent of its customers and therefore, the banker, the banker- customer relationship in this case changes from the debtor-creditor relationship to the agent-Principal relationship. The collection of bills usually involves two banks; the collecting bank and the paying bank. Both, collecting as well as paying, banks have certain obligations to each other and to their customers. They have certain legal rights also and legal protection is available against fraudulent transactions under various sections of the Negotiable Act, 1881.

3.4.7 INFORMATION TECHNOLOGY DEPARTMENT: THE BANK OF KHYBER Islamic banking uses an integrated computer software called UBank plus, windows based software. To run this integrated system the Bank of Khyber Islamic banking branch Swabi has a networked hardware resources including: 

A Server computer.



06 Client computers.



Internet Facility.



CCTV Cameras with LCD for Security.



02 laser printers.



Fax Machine.



01 scanner and related accessories.

3.5

FUNCTIONS

OF

DEPARTMENTS

IN

GENERAL

BANKING

(OPERATION DEPARTMENT):

3.5.1 FUNCTIONS OF DEPOSIT DEPARTMENT: 

The main function of this department is to mobilize savings and channels them into short-term investments such as advances.



To establish the banker customer relationship. 20

Chapter – 3 “Organizational Structure of BOK” 3.5.2 FUNCTIONS OF CASH DEPARTMENT: 

The main function of cash department is cash receipts and cash payments.

3.5.3 FUNCTIONS OF ACCOUNTS DEPARTMENT: 

To prepare the Budgets.



To prepare the quarterly, semi-annually and annually Reports of the Bank.



Maintenance & depreciation of fixed assets.



Miscellaneous functions such as Closing Entries, Daily activity Checking, Report Generation and Minor expense Recording.

3.5.4 FUNCTIONS OF REMITTANCES DEPARTMENT: 

The transfer of funds as well as the receipts from other branches of the bank is the basic responsibility of remittances department.

3.5.5 FUNCTIONS OF CLEARING DEPARTMENT: 

To accept Transfer, Transfer delivery, clearing and collection cheques from the customers of the branch and to arrange for their collection.



To arrange the payment of cheques drawn on the branch and given for collection to any other branch on BOK or any other members or sub member of the local clearing house.



To collect amount of cheques drawn on members, sub-member of local clearing house, sent for collection by i.e. ABL Branches, not represented at the local clearing house.

3.5.6 FUNCTIONS OF BILLS DEPARTMENT: 

The Bills Department deals with the collection, purchase and discounting of bills on behalf of the customers.

3.5.7 FUNCTIONS OF INFORMATION TECHNOLOGY DEPARTMENT: 

The main function of IT department is to provide an integrated system of networking to the Bank Employees.



To reduce the Transaction process time of the customers.



To Provide the Software and ensure the Identity and Network Security for the data.



To provide the ATM service and Online Banking facility.

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