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0189-Banking Law & Practice Assignment


ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD
(Department of Business Administration)

BANKING LAW AND PRACTICE (189)

CHECKLIST

SEMESTER: SPRING 2012



This packet comprises the following material:

1.                  Text Book (one)
2.                  Course Outline
3.                  Assignment No. 1, 2
4.                  Assignment Forms ( 2 sets )

In this packet, if you find anything missing out of the above mentioned material, please contact at the address given below:

The Deputy Registrar
Services Block No. 28
Allama Iqbal Open University
H-8, Islamabad.


Nadia Rashid
 (Course Coordinator)

ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD
(Department of Business Administration)


WARNING
1.         PLAGIARISM OR HIRING OF GHOST WRITER(S) FOR SOLVING THE ASSIGNMENT(S) WILL DEBAR THE STUDENT FROM AWARD OF DEGREE/CERTIFICATE, IF FOUND AT ANY STAGE.
2.         SUBMITTING ASSIGNMENTS BORROWED OR STOLEN FROM OTHER(S) AS ONE’S OWN WILL BE PENALIZED AS DEFINED IN “AIOU PLAGIARISM POLICY”.

ASSIGNMENT No. 1
Course: Banking Law and Practice (189)                            Semester: Spring 2012
Level: BBA                                                                                              Marks: 100


Q. 1  Discuss in detail the functions and credit control measures of State bank of Pakistan and Reserve Bank of India. Also give comparison between both banks policies.                                    (20)

Q. 2  Discuss the rights and obligations of banker and customer to each other in detail.         (20)

Q. 3  What do you mean by accounts of special customers? How these accounts are opened by a bank? Discuss the procedure of opening such accounts in detail.                                             (20)

Q. 4  Discuss in detail the significance and use of deposits in banking system of
Pakistan.                                                                                                      (20)

Q. 5  (a)     “Mr. Hasan promises to pay Mr. Sajid Rs. 100,000 and all other sums which shall be due to him.” Is it a promissory note? State reasons.                                                          (10)

   (b)     Differentiate between the features of bill of exchange and promissory note.
                                                                                                                        (10)

                                   ASSIGNMENT No. 2               Total Marks: 100

Q. 1  Discuss the different types of loans being offered by banks in Pakistan. Also describe the basic principles that must be observed by a bank while extending loan to a borrower.                (20)

Q. 2  How the State Bank of Pakistan control the bank credit in Pakistan? Discuss the various tools used by it for controlling the credit.                                                                                   (20)

Q. 3  Critically evaluate the contemporary practices of Islamic banks in Pakistan. Also explain that how much it comply with Islamic Shariah.                                                                       (20)

Q. 4  What do you mean by Letter of Credit? Discuss in detail the mechanism involved in making payments for overseas business through a letter of credit.                                                 (20)

Q. 5  Write note on the following:                                                                         (20)
         (a)     Foreign Exchange Regulation Act, 1947
         (b)     Banking Companies Ordinance, 1962


BANKING LAW AND PRACTICE
COURSE OUTLINE (BBA-189)

UNIT 1   INTRODUCTION TO BANKING IN THE WORLD AND PAKISTAN
               Evolution of Banking, Early Growth, Modern Banking, Development of Modern Banking, Types of banks, Development of Banking in America, Banking during Muslim Rule in India, The Emergence of Public Banks in India, Joint Stock Bank, Exchange Banks, The Imperial Bank of India, The Reserve Bank of India, Post-World War Indian Banking, Banking in Pakistan

UNIT 2   TYPES OF DEPOSITS/ACCOUNTS AND BANKER-CUSTOMER RELATIONSHIP
               Deposits, Nature of deposits (Accounts) such as Current, Term Deposits, Term Deposits in Joint Names, Saving Deposits, Call, Short Notice Deposits and Pak Rupee Non-Resident Accounts, Foreign Currency Accounts, Importance and Mobilization of Deposits in Banking System                 
                        Banker, Functions Of The Banker, Customer, Qualifications of Customer, Rights and Obligations of Customer Towards The Banker, General Relationship, Other Relationships, Special Features of Relationship, Right to Lien, Right of Set off, Banker’s Duty of Secrecy, Termination of Relationship

UNIT 3   ACCOUNTS OF GENERAL AND SPECIAL CUSTOMERS
               Accounts of General Customers: Introduction and Preliminary Investigation, Specimen Signature, Married Women, Pardanashin Women, Minor Accounts, Individual Accounts, Joint Accounts
                        Accounts of Special Customers: Partnership Firms, Joint Stock Companies, Accounts of Clubs, Societies, and Associations, Agents Accounts, Trust Account, Executor’s and Administrators Account, Account of Local Bodies

UNIT 4   CHEQUES, PROMISSORY NOTE, AND BILL OF EXCHANGE
               Cheques: Definition, Types of Cheques, The Requisites of a Cheque, Parties to a Cheque; Promissory Note; Bill of Exchange: Parties to a Bill of Exchange, Types of Bills; Banker’s Draft, Pay Order, Telegraph Transfers, Mail Transfers, Travellers Cheques etc

UNIT 5   CREDIT OPERATIONS IN BANKS
               Principles and Forms of Lending: Principles of Lending; Forms of Lending- Cash Finance, Overdraft; Loans- Bridge and Participation Loans, Purchase and Discounting of Bills
                        Securities for Advances: Classification of Securities, Banker’s Lien, Charge, Contract of Pledge, Hypothecation, Guarantees, Indemnity

UNIT 6   CONTROL OF BANK CREDIT IN PAKISTAN
               Bank Rate, Open Market Operation, Variable Reserve Requirements, Selective Credit Control, National Credit Consultative Council, Small Loans Scheme, Agricultural Finance, Industrial Finance, Export Finance, Export Finance Scheme

UNIT 7   DEVELOPMENT OF ISLAMIC BANKING IN PAKISTAN
               -        Main features of the Islamic Economic system
               -        System of Interest Free Banking and Implementation in Pakistan
               -        Modes of Non-Interest Financing
                        (i)         Financing by Lending:
                                    (a)        Qard-e-Hasna
(b)               Loans with service charges
                        (ii)        Trade Related Modes:
                                    (a)        Purchase of Trade bills
                                    (b)        Purchase and sale of goods on Mark up basis
                                    (c)        Financing for the development of a property on the basis of "development charge:.
                                    (d)        Purchase of goods/immovable property under buy-back agreements
                                    (e)        Hire purchase
                                    (f)        Leasing
                        (iii)       Investment Type modes:
                                    (a)        Musharika
                                    (b)        Participating Term and Modaraba certificates
                                    (c)        Equity participation
                     (d)        Rent Sharing

UNIT 8   AN INTRODUCTION TO FOREIGN EXCHANGE
               Why Foreign Exchange? Foreign Exchange Control in Pakistan, Mechanism of Foreign Exchange,
               Letters of Credit (L/C): Definition, Classes of Letters of Credit- Documentary Letters of Credit, Revocable and Irrevocable Letters of Credit, Revolving Letters of Credit, Red Clause Credit, Green Clause Credit, Transferable and Assignable Credit, Back to Back Credit, Deferred Payment Credit, Acceptance Terms Credit, Advantages of Letter of Credit, Rights and Liabilities of Opening Banker and Negotiating Banker, Negotiation of documents, Remittance Against Imports, Forward Exchange Contract, Forward Cover Against Exports

UNIT 9   AN INTRODUCTION TO BANKING LAWS IN PAKISTAN
               -        Negotiable Instruments Act, 1881
               -        State Bank of Pakistan Act, 1956
               -        Banking Companies Ordinance, 1962
               -        Banks (Nationalization) Act, 1974
-                Foreign Exchange Regulation Act, 1947

BOOK RECOMMENDED:

               Practice and Law of Banking in Pakistan, By Dr. Asrar H. Siddiqi







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