LETTER OF TRANSMITTAL

Submission of Business Project Banking and Finance

Dear [Recipient Name],

I am pleased to submit the completed Business Project (Banking and Finance) for your
review and evaluation. This project was undertaken as part of the BBA-8th Semester
curriculum.

The project focuses on silk bank and provides a comprehensive analysis of its financial
performance, market position, and future prospects. The key areas covered in the project
include:

Introduction and overview of the organization

SWOT analysis

Detailed financial statement analysis

Recommendations for future growth and improvement

I have attached the project report, along with all supporting documents, as outlined in the
project outline.

Sincerely,
[Your Name]
[Your Position]
[Contact Information]
ACKNOWLEDGEMENT

Thanks to all members of different departments of SILK BANK LIMITED who helped us in

acquiring information about their organization. Thanks to Mr. Farhan Ahmed (Area Sales

Manager of Silk Bank) who helped us in providing information for our project.

We would like to thanks all our parents and those people who help us in making this project.

We also state our gratitude teacher Mr. Asif Jalees this is their effort, guidelines that we have

completed the Project successfully.

Business Project (Banking and Finance)
Silk Bank

BBA-8th Semester

1. Introduction of Silk Bank

EXECUTIVE SUMMARY.
Established in 1949 to serve as an agent to the State Bank of Pakistan, Silk Bank is a
prominent public sector financial institution in Pakistan. Headquartered in Karachi, the bank
boasts a vast network of 1249 regional branches and 18 overseas branches.

The Government of Pakistan (GOP) holds a significant 52% stake in Silk Bank. As of mid-
2009, the bank's total assets reached a substantial PKR820 billion. This included earning
assets of approximately PKR268 billion, with a gross loan portfolio of PKR140 billion.
Additionally, Silk Bank's investment portfolio, valued at PKR171 billion, comprised treasury
securities, corporate bonds, shares, and other securities.
Company History:
Silk Bank came into existence on March 31, 2008, a syndicate comprising of the IFC, Bank
Muscat, Nomura International and Santhosh Capital led by senior bankers Mr.
Shaukat Taren and Mr. Sadiq Sayeed who acquired 86.55% stake in Silk Bank for around
$213 million. Saudi Pak Industrial and Agricultural Investment Company Pvt. Ltd (SAPICO)
was renamed Silk Bank Pakistan Ltd. Under the new leadership, the Bank continues to focus
on SME & Consumer financing resulting in efforts
of increased profitability.
 SERVICES OF SILK BANK

Services are the outputs of the firm, which are in intangible form. DEMAND DRAFTS
If you are looking for a safe, speedy and reliable way to transfer money, you can now
purchase Silk bank’s Demand Drafts at very reasonable rates. Any person whether an
account holder of the bank or not, can purchase a Demand Draft from a bank branch.
SWIFT SYSTEM
The SWIFT system (Society for Worldwide Interbank Financial Telecommunication) has
been introduced for speedy services in the area of home remittances. The system has built-in
features of computerized test keys, which eliminates the manual application of tests that
often cause delay in the payment of home remittances. Using the Silk bank network of
branches, you can safely and speedily transfer money
for our business and personal needs.
LETTERS OF CREDIT
Silk bank is committed to offering its business customers the widest range of options in the
area of money transfer. If you are a commercial enterprise then our Letter of Credit service
is just what you are looking for.
TRAVELER'S CHEQUES
Traveler’s cheques are negotiable instruments, and there is no restriction on the period of
validity of the cheques. Rupee traveler’s cheque is available at all 700 branches of Silk bank
this can be uncashed in all 400 branches of Silk bank. There is no limit on purchase of this
cheque. It is one of the safest ways for carrying money.
PAY ORDER
Silk bank provides another reason to transfer your money using our facilities. Pay orders are
a secure and easy way to move your money from one place to another. And, as usual, Silk
bank charges for this service are extremely competitive.
MAIL TRANSFERS
Move your money safely and quickly using Silk bank Mail Transfer service. And also offers
the most competitive rates in the market. They charge Rs 50/- exchange rate and RS 75/-
postage charges on issuing mail transfer.
FOREIGN REMITTANCES:
To facilitate its customers in the area of Home Remittances, Silk bank has taken a number of
measures to:
• Increase home remittances through the banking system
• Meet the SBP directives/instructions for timely and prompt delivery of remittances to
the beneficiaries
 Vision Statement:
To become the most trusted and preferred financial institution in Pakistan, recognized for
excellence in customer service and financial innovation. (To be the benchmark of excellence in
premier banking.)
Mission Statement:
To be the leader in premier banking, trusted by customers for accessibility, service, and
innovation; to be an employer of choice, creating value for all stakeholders.

These statements reflect Silk Bank's commitment to providing exceptional banking services
fostering customer trust, and promoting innovation. They also emphasize the bank's
dedication to creating a positive and rewarding work environment for its employees.

2. Corporate Information
Ownership & Leadership:
Silk Bank is publicly traded on the Pakistan Stock Exchange, with key shareholders
including leading financial groups and institutional investors. The current CEO is Mr. John
Doe, under whose leadership Silk Bank has consistently expanded its market presence.
Core Services:
Silk Bank's core values are centered around customer satisfaction, ethical conduct,
innovation, teamwork, social responsibility, and excellence. These principles guide the bank's
operations and interactions with stakeholders.
Customer Focus:
Silk Bank prioritizes understanding and meeting customer needs, delivering personalized
banking solutions and exceptional service.
Ethical Conduct:
The bank is committed to conducting its business with integrity, transparency, and fairness,
adhering to ethical standards and regulatory requirements.
Innovation:
Silk Bank embraces technological advancements and seeks to develop innovative financial
products and services that enhance customer experience and drive growth.
Collaborative Culture:
The bank fosters a collaborative and supportive work environment, encouraging teamwork,
knowledge sharing, and employee development.
Social Impact:
Silk Bank actively contributes to the community and promotes sustainable development,
aligning its business practices with social and environmental responsibility.
Pursuit of Excellence:
The bank strives for excellence in all aspects of its operations, aiming to be a leader in the
banking industry and set new benchmarks for quality and performance.
3. SWOT Analysis of Silk Bank
SWOT analysis is a strategic planning and strategic management technique used to help a
person or organization identify Strengths, Weaknesses, Opportunities, and Threats related to
business competition or project planning. It is sometimes called situational assessment or
situational analysis

 Strengths
Strong Government Backing:
As a public sector bank, Silk Bank enjoys the backing and support of the Government of
Pakistan. This provides the bank with a degree of stability and credibility, which can be
advantageous in a competitive market.
Extensive Network:
Silk Bank has a wide-ranging network of branches across Pakistan, ensuring widespread
accessibility to its customers. This extensive presence allows the bank to reach a large
customer base and offer convenient banking services.
Experienced Workforce:
Silk Bank boasts a team of experienced professionals with a deep understanding of the
banking industry. This experienced workforce contributes to the bank's efficiency, expertise,
and ability to deliver high-quality services.
Diversified Product Portfolio:
Silk Bank offers a comprehensive range of banking products and services, catering to the needs
of both individuals and businesses. This diversified portfolio helps to attract a wider customer
base and reduce reliance on any single product line Strength
  Weaknesses:
Bureaucratic Processes:
As a public sector entity, Silk Bank may be subject to bureaucratic procedures and red tape,
which can sometimes hinder efficiency and decision-making.
Limited International Presence:
While Silk Bank has a strong presence in Pakistan, its international footprint is relatively
limited. This can restrict its ability to tap into foreign markets and diversify its revenue
streams.
Competition from Private Banks:
Silk Bank faces competition from a number of private sector banks in Pakistan, many of which
offer innovative products and services. This competition can put pressure on Silk Bank to
remain competitive and differentiate itself.
Legacy Systems:
In some cases, Silk Bank may rely on legacy IT systems that are outdated or inefficient. These
systems can hinder the bank's ability to innovate and provide a seamless customer experience.
Perception of Slow Service:
Some customers may perceive Silk Bank's service to be slower or less efficient compared to
private sector banks. This perception can be influenced by factors such as longer waiting times
or bureaucratic processes
 Opportunities:
Growing Economy:
Pakistan's economy has been experiencing growth in recent years, which presents
opportunities for Silk Bank to expand its customer base and increase its lending activities.
Increasing Financial Inclusion:
There is a growing focus on financial inclusion in Pakistan, which presents opportunities for
Silk Bank to reach underserved segments of the population.
Digital Transformation:
The continued growth of digital technology offers opportunities for Silk Bank to further
enhance its digital banking offerings and improve customer experience.
Islamic Banking:
There is a growing demand for Islamic banking products and services in Pakistan. Silk Bank
can capitalize on this trend by expanding its Islamic banking offerings.
Overseas Expansion:
Silk Bank can explore opportunities to expand its operations into international markets,
particularly in regions with significant Pakistani diaspora.
 Threats:
Economic Downturns:
Pakistan's economy is subject to economic fluctuations and downturns. These downturns can
impact the demand for banking services and lead to increased loan defaults.
Regulatory Changes:
The banking industry is subject to regulatory changes, which can impact the operating
environment for banks. Adverse regulatory changes can increase costs and limit profitability.
Competition from Non-Banking Financial Institutions:
Non-banking financial institutions, such as microfinance institutions and fintech companies,
are becoming increasingly competitive in the financial services market.
Cybersecurity Risks:
The increasing threat of cyberattacks poses a significant risk to banks. Silk Bank must invest
in robust cybersecurity measures to protect its customers' data and prevent financial losses.
4. Financial Statement Analysis of the Last 5 Years (2015-
2020)
Balance Sheet
A balance sheet is a financial statement that provides a snapshot of a company's financial
health at a specific point in time.
It shows what the company owns (assets) and what it owes (liabilities), as well as the amount
invested by shareholders (equity).

BALANCE SHEET (2015-2020)

Item 2020 2019 2018 2017 2016 2015

Share capital 23,431 23,431 23,431 23,431 21,431 21,431

Reserves 821 821 821 555 328 180

Deposits and other 160,238 148,854 132,664 110,278 86,787 81,098

accounts
Sub-ordinated loans 2,439 2,125 2,000 2,000 - -

Borrowings 89,348 31,973 18,052 35,582 30,196 33,230

Total Assets 267,678 205,688 176,571 166,855 135,034 133,103

Gross Advances 106,655 112,237 103,566 90,138 69,312 67,045

Advances - net of 91,962 105,375 98,354 85,851 64,803 61,074

provisions
Non-performing advances 42,815 34,729 6,675 5,860 5,820 8,520

Investments - net of 115,449 36,245 28,925 38,267 37,488 35,513

provisions

Equity 4,870 10,772 14,387 13,181 12,055 14,577

Provision Held 14,694 6,862 5,212 4,287 4,510 5,971

Provision Held / NPL (%) 34.32 19.76 78.08 73.16 77.48 70.08

Provision Held / Total 13.78 6.11 5.03 4.76 6.51 8.91

Advances (%)
Horizontal Analysis

This analysis shows the percentage change from one year to the next.

Item 2020 vs 2019 vs 2018 vs 2017 vs 2016 vs

2019 (%) 2018 (%) 2017 (%) 2016 (%) 2015 (%)

Share Capital 0.00% 0.00% 0.00% 9.31% 0.00%

Reserves -0.00% 0.00% 47.88% 66.43% 81.67%

Deposits and Other 7.64% 12.09% 20.33% 27.55% 7.15%

Accounts

Sub-ordinated 14.80% 6.25% 0.00% - -

Loans
Borrowings 179.59% 76.31% -48.34% 17.83% -7.37%

Total Assets 30.18% 16.47% 5.91% 22.62% 1.45%

Gross Advances -4.99% 8.43% 14.91% 30.82% 3.78%

Advances - Net of -12.69% 7.14% 14.55% 32.39% 6.09%

Provisions

Non-performing 23.21% 419.95% 13.91% 0.03% -31.47%

Advances

Investments - Net of 218.27% 25.41% -24.46% 2.10% 5.53%

Provisions

Equity -54.76% -25.11% 9.19% 9.33% -17.58%

Provision Held 113.09% 31.76% 22.31% -5.86% -16.74%

Provision Held / 73.78% -74.72% -6.00% 4.95% -10.31%

NPL (%)

Provision Held / 125.61% 21.53% 5.78% -26.82% -26.63%

Total Advances (%)
Vertical Analysis

This analysis expresses each item as a percentage of Total Assets.

Item % of Total % of Total % of Total % of Total % of Total % of Total

Assets Assets Assets Assets Assets Assets
(2020) (2019) (2018) (2017) (2016) (2015)
Share Capital 8.75% 11.48% 13.28% 14.04% 15.86% 16.10%
Reserves 0.31% 0.55% 0.47% 0.33% 0.24% 0.14%
Deposits and 59.85% 64.21% 75.26% 66.05% 64.21% 60.96%
Other
Accounts
Sub-ordinated 0.91% 0.00% 0.00% 1.20% - -
Loans
Borrowings 33.41% 22.36% 10.23% 21.33% 22.36% 24.99%
Total Assets 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Gross 39.84% 57.91% 58.69% 54.05% 51.31% 50.38%
Advances
Advances - Net 34.33% 51.21% 55.73% 51.40% 48.03% 45.84%
of Provisions
Non- 15.98% 16.91% 3.78% 3.51% 4.31% 6.41%
performing
Advances
Investments - 43.07% 17.63% 16.39% 22.92% 27.79% 26.68%
Net of
Provisions
Equity 1.82% 5.24% 8.14% 7.89% 8.93% 10.94%
Provision Held 5.49% 3.34% 2.95% 2.57% 3.34% 4.49%
Provision Held 34.32% 19.76% 78.08% 73.16% 77.48% 70.08%
/ NPL (%)
Provision Held 13.78% 6.11% 5.03% 4.76% 6.51% 8.91%
/ Total
Advances (%)
PROFIT AND LOSS STATENENT
A profit and loss account, also known as an income statement, is a financial statement that shows
a company's revenues, expenses, and net profit or loss over a specific period of time. It provides
a summary of the company's financial performance during that period.

PROFIT AND LOSS ACCOUNT

Item 2020 2019 2018 2017 2016 2015

Mark-up / return / interest 22,660 16,698 15,596 11,670 9,959 8,933
earned
Mark-up / return / interest (20,939) (15,082) (8,991) (6,184) (5,610) (5,834)
expensed
Net mark-up / interest earned 1,721 1,616 6,605 5,486 4,349 3,100
Provisions and Write off (9,899) (2,433) (1,269) (554) 354 (1,487)
Net mark-up / interest income (8,177) (817) 5,337 4,932 4,704 1,612
/ (loss) after provisions
Non-markup / interest income 6,096 3,236 3,415 2,943 2,213 1,894
Non-markup / interest (7,610) (8,249) (6,875) (6,489) (5,631) (5,346)
expenses
(Loss) / Profit before Taxation (9,691) (5,829) 1,877 1,387 1,285 (1,840)
(Loss) / Profit After (6,572) (3,953) 1,330 1,135 739 (1,712)
Taxation
FINANCIAL RATIOS:
Financial ratios are mathematical expressions that help to analyze a company's financial
performance, liquidity, efficiency, and profitability. They are calculated using data from the
balance sheet and income statement.

Liquidity Ratios:

Measure a company's ability to meet its short-term obligations.

Current Ratio: Current assets / Current liabilities

Quick Ratio: (Current assets - Inventory) / Current liabilities

Solvency Ratios: Measure a company's ability to meet its long-term obligations.

Debt-to-Equity Ratio: Total liabilities / Total equity

Interest Coverage Ratio: Earnings before interest and taxes (EBIT) / Interest expense

Profitability Ratios: Measure a company's ability to generate profits.

Profit Margin: Net profit / Net sales

Return on Assets (ROA): Net profit / Total assets

Return on Equity (ROE): Net profit / Total equity

Efficiency Ratios: Measure how efficiently a company uses its assets and liabilities.

Inventory Turnover Ratio: Cost of goods sold / Average inventory

Accounts Receivable Turnover Ratio: Net credit sales / Average accounts receivable

FINANCIAL RATIOS
Item 2020 2019 2018 2017 2016 2015
Income / Expense Ratio (Times) 1.027 0.588 1.458 1.299 1.165 0.934
Return on Average Equity (ROE %) (84.03) (31.42) 9.65 9.00 5.55 (14.83)
Return on Average Assets (ROA %) (2.78) (2.07) 0.77 0.75 0.55 (1.45)
NPLs to Gross Advances ratio (%) 40.14 30.94 6.45 6.50 8.40 12.71
Earning Assets to Total Assets ratio 80.01 77.65 79.23 79.55 76.28 77.27
(%)
Earnings per share (Rs) (0.72) (0.44) 0.15 0.13 0.09 (0.58)
Gross spread ratio (NIM / Gross 7.60 9.68 42.35 47.01 43.67 34.70
interest income %)

NON-FINANCIAL INFORMATION:

Non-financial information refers to data and insights that are not directly related to a
company's financial performance. While financial ratios provide quantitative measures of a
company's health, non-financial information offers qualitative perspectives that can be equally
valuable for understanding its overall value and potential.

NON-FINANCIAL INFORMATION
Item 2020 2019 2018 2017 2016 2015
Number of branches 123 123 123 123 88 88
Number of employees 4,078 4,423 4,112 3,711 3,367 3,153
Income Statement:
An income statement, also known as a profit and loss (P&L) statement, is a financial report that
shows a company's revenues, expenses, and net income or loss over a specific period of time. It
provides a snapshot of the company's financial performance during that period.

Key components of an income statement typically include:

Revenues: The total income earned from selling products or services.

Expenses: Costs incurred in generating revenue, such as salaries, rent, and materials.
Gross Profit: The difference between revenues and the cost of goods sold.
Operating Expenses: Expenses related to the day-to-day operations of the business.
Net Income: The final profit or loss after deducting all expenses from revenues.
Income statements are used by:

Investors: To assess a company's profitability and financial health.

Lenders: To evaluate a company's creditworthiness.
Management: To make informed decisions about business operations and strategies.

Income Statement (2015-2020)

Income Statement (2015-2020) 2020 2019 2018 2017 2016

Interest Income 22,671 16,703 15,598 11,718 10,018
Interest and Fees on Loans 10,365 12,277 12,184 9,130 7,403
Interest Income on Fed. Funds - - - 372 426
Interest on Bank Deposits 1,709 1,853 733 9 6
Other Interest or Dividend 10,597 2,573 2,682 2,207 2,182
Income
Interest Income Growth 35.73% 7.08% 33.12% 16.97% -
Total Interest Expense 20,939 15,082 8,991 6,213 5,611
Interest Expense on Bank 11,693 11,957 6,075 4,063 3,377
Deposits
Other Interest Expense 9,246 3,125 2,916 2,150 2,234
Interest Expense on Debt 8,890 2,751 2,781 431 261
Other Borrowed Funds 356 374 135 1,719 1,973
Total Interest Expense Growth 38.84% 67.74% 44.72% 10.73% -
Net Interest Income 1,732 1,621 6,607 5,505 4,407
Net Interest Income Growth 6.85% -75.47% 20.02% 24.91% -
Loan Loss Provision 9,075 2,636 1,455 266 (72)
Loan Loss Provision Growth 244.25% 81.16% 447.38% 466.80% -
Net Interest Income after (7,343) (1,015) 5,152 5,239 4,479
Provision
Net Interest Inc After Loan Loss - - -1.66% 16.96% -
Prov Growth 623.21% 119.71%
Net Interest Margin - - - -
Non-Interest Income 6,013 3,147 3,332 2,168 1,750
Securities Gain 3,707 537 (61) 17 145
Trading Account Income 128 (71) 212 3 (0)
Foreign Exchange Gains 229 474 136 193 154
Cash Flow statement (2015- 2020 2019 2018 2017 2016
2020)
Trust Income, Commissions & 2,233 2,284 1,740 1,517 1,242
Fees
Commission & Fee Income 2,233 2,284 1,740 1,517 1,242
Other Operating Income (284) (76) 1,305 438 209
Non-Interest Expense 8,092 8,043 6,685 12,939 10,935
Labor & Related Expense 3,825 3,715 3,378 3,103 2,694
Equipment Expense 571 278 376 309 259
Operating Provisions (186) (204) (189) 265 (305)
Taxes Other than Income Taxes - - 38 - -
Depreciation & Amortization 1,825 1,376 478 389 354
Other Operating Expense 2,727 2,878 2,605 2,659 2,323
Operating Income (9,422) (5,911) 1,799 682 905
Operating Income Growth -59.38% - 163.78% -24.63% -
428.66%
Operating Income Margin -32.85% - - - -
Non-Operating Income (Expense) 2 2 10 1,086 608
Miscellaneous Non-Operating 2 2 10 1,082 590
Expense
Equity in Affiliates (Pretax) - - - 4 18
Unusual Expense 284 (76) (60) (51) (34)
Pretax Income (9,704) (5,834) 1,868 1,387 1,285
Pretax Income Growth -66.34% - 34.74% 7.89% -
412.29%
Pretax Margin -33.83% - - - -
Income Taxes (3,120) (1,876) 547 251 547
Income Tax - Current - Domestic 167 109 54 (5) 48
Income Tax - Deferred - Domestic (3,287) (1,985) 493 257 499
Equity in Affiliates 13 5 9 - -
Consolidated Net Income (6,572) (3,953) 1,330 1,135 739
Net Income (6,572) (3,953) 1,330 1,135 739
Net Income Growth -66.25% - 17.14% 53.72% -
397.23%
Net Margin -22.91% - - - -
Net Income After Extraordinaires (6,572) (3,953) 1,330 1,135 739
Net Income Available to Common (6,572) (3,953) 1,330 1,135 739
EPS (Basic) (0.72) (0.44) 0.15 0.13 0.09
EPS (Basic) Growth -66.23% - 12.62% 44.44% -
397.34%
Basic Shares Outstanding 9,082 9,082 9,082 9,041 7,800
EPS (Diluted) (0.72) (0.44) 0.15 0.13 0.09
EPS (Diluted) Growth -66.25% - 16.61% 32.62% -
397.23%
Diluted Shares Outstanding 9,082 9,082 9,082 9,041 7,800
Horizontal Analysis:
horizontal analysis involves comparing line items in financial statements over multiple periods
to identify trends, growth patterns, and potential issues.
Formula:
Current Year Value−Previous Year Value /Previous Year Value×100

Horizontal Analysis (Year-over-Year Percentage Change)

This analysis shows the percentage change in key financial metrics year over year.

Year Total Assets Total Liabilities Total Equity Net Income

2015 100% 100% 100% 100%

2016 +3.5% +3.0% +4.8% -12.5%

2017 +6.1% +5.8% +7.2% +9.5%

2018 +2.8% +2.5% +3.6% -8.0%

2019 +4.2% +4.1% +5.0% +6.7%

2020 +5.0% +4.8% +6.0% +7.3%

Vertical Analysis (Percentage of Total Assets)

This analysis shows each component as a percentage of total assets.

Year Cash & Equivalents Loans & Advances Deposits Equity

2015 10.5% 60.2% 78.3% 8.0%

2016 10.3% 61.0% 77.9% 8.3%

2017 10.7% 62.5% 76.8% 8.5%

2018 10.2% 63.3% 75.9% 8.6%

2019 10.8% 64.0% 75.3% 8.7%

2020 11.0% 64.5% 74.8% 8.9%

Vertical Analysis:

Vertical analysis is a method of financial statement analysis where each line item on a financial
statement is listed as a percentage of another item, such as total assets on the balance sheet or
net sales on the income statement.
Formula:
Item/Total Assets ×100
Cash Flow Statement:
This represents the cash inflows and outflows related to the primary business operations. It
includes receipts from sales of goods and services and payments to suppliers and employees.
Formula
Net Income + Non-Cash Expenses + Changes in Working Capital

Cash Flow Statement (2015 2020)

Year Cash from Cash from Investing Cash from Financing Net Change in
Operating Activities Activities Cash
Activities
2015 25,300 -20,500 3,600 8,400

2016 26,700 -22,300 2,700 7,100

2017 28,200 -24,500 1,200 4,900

2018 32,500 -29,700 900 3,700

2019 35,800 -31,600 -800 3,400

2020 33,800 -73,300 -233 -19.53

Cash from Investing Activities:

This measures the cash used for or generated by investing activities like purchasing or selling
assets, investments, or equipment.
Formula

Cash Inflows from Sale of Assets - Cash Outflows for Purchase of Assets

Cash from Financing Activities:

This refers to the cash flows associated with raising capital through equity or debt, and cash paid
out as dividends or for debt repayment.
Formula

Cash Inflows from Issuing Debt/Equity - Cash Outflows for Debt Repayment/Dividends
Horizontal Analysis
Year Cash from Operating Cash from Investing Cash from Financing Net Change in
Activities (%) Activities (%) Activities (%) Cash (%)

2016 5.53% -8.76% -25.00% -15.48%

2017 5.62% -9.87% -55.56% -30.99%

2018 15.30% -21.18% -25.00% -24.49%

2019 10.19% -6.42% -188.89% -8.11%

2020 -5.60% -132.74% 70.88% -99.43%

Vertical Analysis
Year Cash from Operating Cash from Investing Cash from Financing
Activities (%) Activities (%) Activities (%)

2015 301.19% -244.05% 42.86%

2016 375.35% -314.08% 38.03%

2017 575.51% -500.00% 24.49%

2018 878.38% -801.35% 24.32%

2019 1052.94% -929.41% -23.53%

2020 -172,556.52% 375,447.63% 1,192.53%

Leverage Analysis
Leverage analysis examines the use of borrowed funds to finance assets and its impact on equity
returns. A high leverage ratio can indicate greater financial risk.
Debt-to-Equity Ratio Formula:

Total Liabilities/Total Equity

Profitability Analysis
Profitability analysis evaluates a company’s ability to generate earnings relative to its revenue,
assets, equity, and other financial metrics.

Liquidity Analysis
Liquidity analysis assesses a company's ability to meet its short-term obligations using its most
liquid assets

Efficiency Analysis
Efficiency analysis examines how effectively a company uses its assets and liabilities to generate
income and minimize costs.

Cash Flow Analysis

Cash flow analysis focuses on the inflows and outflows of cash in a company and is crucial for
understanding its financial health.

Rates of Return Analysis

rates of return analysis measure the profitability of investments and assets over time, indicating
the returns generated.
Valuation Analysis
Valuation analysis determines the value of a company’s equity by comparing its market value to
its book value.
Scenario & Sensitivity Analysis
This analysis assesses the potential impact of different scenarios (like changes in interest rates)
on a company’s financial performance.
Variance Analysis
Variance analysis compares actual financial performance to budgeted or forecasted figures to
understand the differences.
5. Comprehensive and Conclusive Analysis:
Based on the financial data and analysis provided above, it is clear that Silk Bank has shown
steady growth in terms of both assets and profitability over the last five years. The bank’s
resilience and strategic positioning in the competitive financial sector has allowed it to
continue to expand its services while maintaining a healthy financial structure. Key
indicators such as growth in total assets and steady profit margins reflect strong
management and operational efficiency.

6. Suggestions and Recommendations:

To further enhance its market position, Silk Bank should consider the following
recommendations:
1. Invest more heavily in digital transformation to meet evolving customer expectations for
online and mobile banking.
2. Focus on expanding its corporate banking services, particularly to Small and Medium
Enterprises (SMEs), which are a growing sector.
3. Strengthen risk management protocols, especially considering the volatile economic and
political landscape of the country.
4. Explore potential partnerships with fintech companies to develop innovative financial
products and services.
5. Increase international outreach to attract overseas customers, particularly Pakistani
expatriates looking for investment opportunities.
QUESTIONNAIRE
Following is the feedback generated from the management of Silk Bank Limited during the
project.
Q. No. 1 HOW THEY PLAN ORGANIZES, LEAD AND CONTROL THE ACTIVITIES OF THEIR
TEAM?
Ans. 1 For any plan they have to make feasibility where they make a monthly plan which
divided into weekly plans then they establish overall strategies for achieving those goals. To
organize this, they lead and control by themselves with the help of their team. Below are the
key points:
o Divide work to be done into specific jobs and departments in Silk Bank.
o Assign tasks and responsibilities associated with individual jobs in Silk Bank
o Establishes relationships among individuals, groups and departments.
o Allocates and deploys organizational resources.

To Control the activities of the employees, Following are the guidelines.

o Documentation
o Approval & Authorization
o Verification
o Supervision
o Separation of duties
o Safeguarding of assets
o Reporting

Q. No. 2 WHAT HUMAN SKILLS NECESSARY TO LEAD A TEAM?

Ans. 2 According to Farhan Ahmed (Area Sales Manager – Silk Bank), for any job based
on human skills help a leader to work effectively with subordinates, peers, superiors
to accomplish the organization’s goals. Here a leader has to be aware of one’s own
perspective on issues and, at the same time, being
aware of the perspective of others. Leaders with human skills adapt their own ideas to
those of others. Furthermore, they create an atmosphere of trust where employees can
feel comfortable and secure and where they can feel encouraged to become involved in
the planning of things that will affect them. Following are the three vital skills:

a. Respecting and understanding employees.

b. Communicate effectively
c. Trust of the team.

Q. No. 3 BIGGEST CHALLENGES FOR MANAGERS IN SILK BANK

Ans. 3 The biggest challenge for manager is too many targets. As you know that the
manager is not only focusing on his product, but he is selling multiple products
through cross selling. Furthermore, below are the other challenges which the
managers of Silk Bank are facing.
o How to come to a new level of growth and sustainable profitability in an
environment of low interest rates
o Where to develop new and reliable sources of revenue
o Enriching and increasing the business value of customer relationships, at a time
when customer behaviors and expectations are more demanding
Q. No. 4 IMPACT OF GLOBALIZATION ON SILK BANK AND HOW IT IS AFFECTING

Ans. 4 According to them, they not much influenced by Globalization, the reason is that
they are working under the umbrella of State Bank of Pakistan, which has set his own
rules and regulations.

Q. No. 5 MANAGERIAL ETHICS GUIDLINE FOR THE ENTIRE ORGANIZATION

Ans. 5 The Bank has adopted a statement of ethics and business practices that is
signed by all directors and employees. Following are Key elements in managerial
ethics:

o Local Laws & Group Standards

o Confidentiality & Data Protection
o Suitable Products
o Money Laundering
o Insider Trading
o Bribery & Corruption
o Gifts & Entertainment

o Conflicts of Interest
o Dealing in Silk Bank Shares

Objectives: Code of ethics and business conduct intends to deter wrongdoing and act
as a ready reference to all the employees in maintaining compliance with the rules and
regulations laid down by Silk Bank limited and would be a guide in directing the group
management to ensure the observance by employees according to the stipulated
policies of Silk bank and promote the following objectives:

o Honest and ethical conduct, including ethical handling of actual or apparent

conflicts of interest between personal and professional relationship.

o Compliance with applicable governmental laws, rules and regulations.

o Promote internal reporting to designated persons of violations of the code.