Marketing of Banking Assets and Liability

Thanks to our Respected Sir !

Sir Khalid Rafique

3

Group Members

Mubashar Maqbool 13- 32

Waseem Baig 13-48

Muhammad Shan 13- 44

Muhammad Sartash 13- 46

Muhammad Ali

13-08

Topic:

Banker and Customer Relationship

Bank:• Bank core business is accept the deposits of money from

public.

• Utilize the deposits in lending to borrowers or investments.

• Bank repayable back to depositors on demand.

• Deposit of money withdraw thorough cheque draft order &

otherwise.

Two deposits classified:

Demand deposits Like current account & PLS saving account

depositors present the cheque on counter or inset his ATM card in ATM

machine & bank is payable to depositors

Time deposits: Bank retain the deposits for specific time period(1 , 6, 12, 24, 36

months) & withdrawn on the expiry time period.

Customer:

• A person/ company/entity who has an account with a bank is a

customer.

• There is no unanimity as regards to the time period of the

dealings. A casual transaction like encashment of a cheque

does not entail a person to be customer.

• The duration of association of the customer with the bank is of

no essence.

Relationship b/w banker & customer

• Relationship is based on offer & acceptance.

• At time customer depots the money he should be offer and

banker is acceptance.

• At the time of financing ; banker offer the amount through

offer letter and customer accept it up on their signature.

• When customer open the account in bank then create a relation

between banking and customer.

Under the LAW of contract person are able in ‘‘section 11: of contract act’’

• Person have maturity aged (+18)

• Person is sound mind

• Person is not disqualified in contract by court.

Other Relationship1. Debtor and creditor:• Bank (debtor)• Customer (creditor)

When customer deposits their money in bank

2. Creditor and debtor• Bank ( creditor)• Customer ( debtor)

When bank offer the finance amount through offer letter

3. Principal and Agent (section 182, contract act)

• Customer (principal) deposits checks, drafts, dividends for collection with the

bank.

• He also gives written instructions to the bank to purchase securities, pay

insurance premium, instalments of loans etc on his behalf.

• When the bank performs such agency services, he becomes an agent of his

customer.

4. Bailer and bailee: (section 148, contract act)

• During certain circumstances banker becomes bailee. When he receives gold

ornaments and important documents for safe custody he takes charge of it as

bailee and not trustee or agent.

• He cannot make use of them as he is bound to return the identical articles on

demand.

5. Pledger and pledgee/ pawner and Pawnee

• Pawn is a sort of bailment in which the goods are delivered to another as a

pawn, to be a security for money borrowed.

• Thus a banker acts as a Pawnee where a customer delivers he goods to him

to be kept as security till the debt is discharged. The banker can retain the

goods pledged till the debt is paid.

6. Mortgager and mortgagee

• He relation between a banker as mortgagee and his customer as mortgagor

arises when the latter executes a mortgage deed in respect of his immovable

property in favour of the bank or deposits the title deeds of his property with

the bank to create an equitable mortgage as security for an advance.

7. Banker and trustee

• When banker appointed as receiver by court in proceeding, money is

deposited in bank and bank act as trustee because in this case bank is

receiver of money for specific propose.

• A banker becomes a trustee under special circumstances. When a customer

deposits securities or other valuables with the banker for safe custody, the

banker acts as trustee of customer.

8. Advisory relationship

• When bank advises the customer to make their investment in particular

business, trade , project etc…

Termination of relationship

• Banker and customer relationship is established when

customer is open the account and both parties are able to

terminate the relationship by closing the account.

Account close by customer:

When customer shift some where & it is not feasible and

convenient to maintain the account in particular branch.

When customer is dissatisfied the branch service.

When bank not offer the particular service which is required

by customer.

When customer not receive the periodically account

statement.

When customer find improper behaviour of bank staff.

Account close by bank: When customer pass habitual cheque for payment without

having sufficient balance in A/C.

When customer account balance is nil more then 6 months.

When customer regularly present the cheque for payment

after counter hours of bank.

When customer not maintain minimum balance in account.

When customer involve in money laundering.

When customer is insolvent

When customer id declared as insane.

Deceased Account:

When customer is die/ death, banker is terminated the account

which is called deceased account. Amount of account paid to

his legal beneficiary.

If persons is death(Deceased Account)

Indemnity bond Succession certificate

Rights and regulations of bank & customerRights of bank

1. Right of lien:

Banker have a right to retain the things/property belonging to

another, until the due of debt is received.

2. Right of set off:

Adjusting the debit balance in the amount of customer against

the credit balance in other account of same customer

3.Right to charged for services:

Banker have the right to charged for service which provided to

customer. Bank notify the schedule of charges of their services

on semi-annually .

4.Revision of charge:

Banker have the right to revision of charge of services which is

offer to customer.

5. Recovery of makeup:

Banker have the right to recover the makeup as per term and

condition of finance agreement.

6. Recover of recovery makeup:

When customer not pay the make-up at timely then banker

have a right charged the penal mark-up.

7. Right to close the A/C:

Bank have the right to close the account for any certain reason

but after the notice.

Obligation of bank1. Banker have a responsibility to ‘‘open the A/C’’ accept the

deposits

2. Banker have the responsibly to accept the cheque but within

the counter hours of bank.

3. Banker have the responsibility to giving the notice before

closing the account.

4. Banker have the responsibility to make a payment when

customer present the cheque on counter for payment.

a) It drawn properly

b) It is drawn any branch of bank, where it is presented for payment.

c) No defect, in apparent tenor of cheque, not a stale, post dated, out of

date, mutilated, turnout.

d) When customer present the cheque there is sufficient credit

balance id available in bank A/C.

e) No, legal bar in payment of cheque

5. Banker have the responsibility to keep a secrecy and congeniality of customer A/C and not disclosed the balance of customer account to their person, if banker disclosed is then customer have a right to sue the bank but some case banker have a right to close the information.a) When information required by police officer if customer in value in any

crime.b) Wen customer in value in money laundering, terrorist, financing,

criminal activity.c) When bank has to file recovery suit against the customer for the

recovery bank due.d) Customer some time provide the account statement to other

departments , agencies who require the statement for verification like VISA agency.

• 6. banker have the responsibility to provide the account

statement periodically to its customer

• 7. banker have the responsibilities to pay profit to customer if

he deposit in profit bearing account.

• 8. bank have a duty to issue the cheque book, ATM card.