Hbr Case Study

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PROCESS OF DEPOSIT AND INTEREST PAID ON DEPOSITS IN HBL HBL keep the deposits of customer both in current and saving account. CURRENT ACCOUNT: 1) In case of current account, HBL doesn’t charge the customer for the services they provide such as the deposits which they secure in the bank. 2) HBL just cut off the government taxes from the deposits of depositor in the current account. According to Mr. Alam Withholding tax of 3% on bank transaction more than 50,000 rupees are the example of government tax which HBL cut from the current account of the depositor and add it to the government account. 3) HBL also don’t provide any interest on amount in the current account. SAVING ACCOUNT: 1) HBL pays a KIBOR of 6% at the moment to those depositors who keep their deposits in saving account. This 6% of KIBOR is the amount of interest paid to the depositor for keeping the amount of money in saving account. KIBOR is set on a daily basis by the State Bank. 2)…show more content…
3) According to Mr. Alam the amount of interest paid to the depositor of saving account depends upon the two different types of KIBOR: a) Fixed KIBOR: In this case KIBOR remains fixed throughout the period and the interest is paid to depositors on the basis of fix KIBOR. b) Fluctuating KIBOR: In this case the interest is paid to depositors on the basis of daily, monthly, quarterly, biannually and annually KIBOR. E.g.: i. Let’s suppose in case of daily basis KIBOR if 1 January interest paid on KIBOR is 5.5%, then on January 2 if KIBOR increases to 6%, then the interest at the same rate will be paid to depositors. ii. Let’s Suppose in case of Monthly basis KIBOR, if on 1 January KIBOR is 4%, then the interest till the next 1 February will be paid on the same

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