Internship Report Nbp (Final)3

ON

INTERNSHIP REPORT 1

Holy Prophet Muhammad (P.B.U.H)

The greatest social reformer

TO My Beloved Mother and Father

Who taught us?

The first word to speak

The first alphabet to write

And

First step to talk……

To

All those from whom I learnt

Who always remains?

In our heart

Through out the whole span of our life and are

INTERNSHIP REPORT 2

Nearest, dearest and deepest

To us

Contents

Introduction o The Sector…………………………………………………08

History of National Bank of Pakistan…………………………………….10

Vision………………………………………………………………………..12

Mission Statement…………………………………………………………12

Core Values……………………………………………………………….. 12

Goals……………………………………………………………………….. 12

Organizational chart……………………………………………………….13

Account opening department...............................................................14

Deposit department..............................................................................19

Credit & Advances Department............................................................21

NBP Karobar........................................................................................28

Foreign Exchange Department............................................................32

Remittance Department.......................................................................35

Clearing Department............................................................................36

Govt. Department.................................................................................38

Financial Analysis................................................................................39

Ratio Analysis.......................................................................................44

Findings................................................................................................51

Swot Analysis......................................................................................52

Suggestions & Recomendations..........................................................54

Duties...................................................................................................56

Accomplishments.................................................................................57

INTERNSHIP REPORT 3

How experience impact in my career...................................................58

Refferances..........................................................................................59

Biblography...........................................................................................60

PREFACE

It is the requirement of all the M.B.A programmes of Department of

Management Sciences. COMSATS Institute of Information Technology,

Sahiwal for the students to undergo six to eight weeks internship training in

any renowned organization. It not only helps to get an exposure to the

practical world and to get familiarized with the practices followed by different

organizations while in pursuit of their objectives but also one can learn to face

the professional challenges that are dramatically different from the

educational world. This period called the “Internship Period “, if spent properly

and sincerely, enables the students to be more confident, more

knowledgeable, more responsible and, above all, more committed to their

work. I have done my internship of six weeks period i.e. from 22-06-09 to 03-

08-09……. in National Bank of Pakistan, Main Branch, Multan.

It has enabled me to understand the practical scenario in which the

banking sector operates. Also it has helped me sharpen my decision

making power so as to utilize the resources in an effective manner to

generate maximum profit.

INTERNSHIP REPORT 4

In preparing this report, I have put all of my best efforts and have tried hard to give

maximum knowledge. Despite of my all the coherent efforts, I do believe that there

will be a room for improvement.

Muhammad Furqan Umar

ACKNOWLEDGEMENT

First of all, I thank Almighty Allah, who has given me the courage to write this

report. I also thank my respectable teacher Miss Fareeha Nisar for her

generous initiation, co-operation and coordination and the way he showed her

concerns from the very beginning till the end. Thank you, Mam; indeed we

owe you a great deal. This internship provided me a golden opportunity to

learn .In this report I’ve tried to relate every thing that I thought was

necessary. Though, it’s a bit difficult to say anything about the perfection of

the effort that I have made but let us hope that it finds its place somewhere to

meet the required and expected criterion.

I am also indebted to the persons under mentioned because without their

help, it would not have been possible for me to achieve this practical

knowledge.

NATIONAL BANK OF PAKISTAN

MAIN BRANCH (0374)

MULTAN

Mr. Sohail Rasool MANAGER OPERATIONS

Mr. Syed Manzar Gillani INCHARGE REMITTANCES

Mr. Syed Sana ullah Kazmi OFFICER (REMITTANCES)

INTERNSHIP REPORT 5

Mr. Mukhtar Hussian OFFICER (GRADE III)

Muhammad Furqan Umar

1. Executive summary

National Bank of Pakistan is the largest commercial bank operating in

Pakistan. It has redefined its role and has moved from a public sector

organization into a modern commercial bank. The Bank's services are

available to individuals, corporate entities and government. While it continues

to act as trustee of public funds and as the agent to the State Bank of

Pakistan (in places where SBP does not have a presence) it has diversified its

business portfolio and is today a major lead player in the debt equity market,

corporate investment banking, retail and consumer banking, agricultural

financing, treasury services and is showing growing interest in promoting and

developing the country's small and medium enterprises and at the same time

fulfilling its social responsibilities, as a corporate citizen.

National Bank of Pakistan is today a progressive, efficient, and customer

focused institution. It has developed a wide range of consumer products, to

enhance business and cater to the different segments of society. Some

schemes have been specifically designed for the low to middle income

segments of the population. These include NBP Karobar, NBP Advance

Salary, NBP Saiban, NBP Kisan Dost, NBP Cash n Gold

It has implemented special credit schemes like small finance for agriculture,

business and industries, administrator to Qarz-e-Hasna loans to students, self

employment scheme for unemployed persons, public transport scheme. The

Bank has expanded its range of products and services to include Shariah

Compliant Islamic Banking products. The Bank is also the largest sponsor of

sports in Pakistan. It has provided generously to philanthropic causes

whenever the need arose.

INTERNSHIP REPORT 6

it has taken various measures to facilitate overseas Pakistanis to send their

remittances in a convenient and efficient manner. In 2002 the Bank signed an

agreement with Western Union for expanding the base for documented

remittances. More recently it has started Electronic Home Remittances

Project. This project introduces technology based system to handle inward

remittances efficiently, by ensuring that the Bank's branches keep a track of

the remittance received from abroad till its final receipt.

National Bank of Pakistan has built an extensive branch network with 1250

branches in Pakistan and operates in major business centre abroad. The

Bank has representative offices in Beijing, Tashkent, Chicago and Toronto.

National Bank has earned recognition and numerous awards internationally. It

has been the recipient of The Bank of the Year 2001, 2002, 2004 and 2005

Award by The Banker Magazine, the Best Foreign Exchange Bank ––

Pakistan for 2004, 2005, 2006 and 2007, Global Finance, Best Emerging

Market Bank from Pakistan for the year 2005, Global Finance, Kissan Time

Awards – 2005 for NBP's services in the agriculture field.

INTERNSHIP REPORT 7

INTRODUCTION OF THE SECOTR

FORMAL DEFINITION OF BANK

“Bank is an institution transacting the business of accepting for the purpose of

money from public, repayable on demand or otherwise and withdrawal by

Cheque, draft, and order includes any post office saving bank.”

Types of bank

These are the following types of banks

Central Bank

Commercial Bank

Exchange Bank

Saving Bank

Industrial Bank

Agriculture Bank

COMMERCIAL BANKS

The most widely spread banks in any country with an objective to mobilize the

saving of the people and providing finance to the investors. These banks are

in the ground for profit earning motive and in competition with each other.

These banks are providing the basic services to the customers in the form of

deposits, advances, remittances and other.

COMMERCIAL BANKS IN THE ECONOMIC DEVELOPMENT OF A

COUNTRY

Banks play an important role in the economic development of a country. If the

banking system is unorganized and inefficient, it creates mal-adjustments and

impediments in the process of development. In Pakistan, the banking system

is organized in a well manner. The State Bank of Pakistan since July 1, 1948

stands at the apex and is responsible of the operation of the banking system.

INTERNSHIP REPORT 8

The other banks, which form the banking structure in Pakistan, are playing

role in the economic development of the country.

The role of the commercial bank in the growth and development of the

economy on sound and steady footings is discussed briefly as follows:

Mobilization Of ResourcesMobilization Of Resources

The commercial banks are the most efficient organizations of the economy in

the mobilization the resources and making a profitable pool of these

resources. Taking then money from the savers and lending it to the investors

is the most prominent job of the bank.

Promotion Of Saving HabitPromotion Of Saving Habit

There are persons who have money but cannot put them in profitable use.

The banks attract these persons by offering a variety of accounts. They

provide them not only the safety of the funds but also higher returns on them.

The banks, in this way, promote the habit of thrift among the people.

Effective Implementation Of Monetary PolicyEffective Implementation Of Monetary Policy

With the help of a good banking system in the country the government and

the Central Bank regulate the monetary supply and demand of the money. A

good system helps in the implementation of the policies that are formulated by

the government. Through these banks using different techniques of credit

control makes credit expansion and contraction.

.

INTERNSHIP REPORT 9

2. History of National Bank of Pakistan

National bank of Pakistan was established on November 8,1949 through

passing of a special ordinance in the National Assembly. The need for the

establishment came due to the reason when at that time newly born country

was facing economic crises. To get rid the intervention form the Reserve Bank

of India, a self owned and operated Central Bank by the name of State Bank

of Pakistan was formed in July 1948 to carry on the responsibilities of issuing

the currency and most importantly controlling the flow of money inside the

country.

State Bank of Pakistan after its formation demanded from the Indian Reserve

Bank the assets against the Indian currency retired from Pakistan territory.

Government of India refused to hand over the assets worth about five

hundred million rupees. This dispute is still unsettled and these assets are still

not delivered to Pakistan.

When British decided to devalue its currency in 1949, India followed a suit

against it, but Pakistan did not, a decision, which attracted some criticism at

that time, but was, certainly justified itself in the way it facilitated the

industrialization in of the country. The arrangement have been made that the

currencies of the countries were to be at par with each other and neither could

alter the par value of its currency without consulting the other. India promptly

challenged Pakistan’s decision as a contravention of the agreement. After

some correspondence between the two Governments, India agreed to

recognize the par value of the Pakistani rupee and a date was decided on

which both Central Banks would announce the par value of their currencies.

An attempt was made by the Pakistan Government to persuade India to

adhere to their previous agreement and an officer of the Finance Ministry was

sent on a one-man mission to Delhi for this purpose. The officer had

discussion with the Indian Ministry of Finance at the highest level but his

mission not fruitful.

INTERNSHIP REPORT 10

As a result of the exchange rate controversy, regular trade and payments

between the two countries came to standstill. India froze the surplus earned

by Pakistan from a favorable balance of trade, and one more financial dispute,

which is still alive, was added to the unsettled list. One of the immediate

consequences of this situation was the withdrawal of Mrwari Merchants of the

Indian finance, which used to be employed annually for the movement of

Pakistan’s jute crop. A crisis of the first magnitude threatened because the

jute crop was already in the markets and, as there was no money to move so

prices began to fall precipitously. At that time, there was no jute industry in

Pakistan, not a single jute loom or a spindle and no possibility, therefore, of

utilizing any of the crops with in the country. As jute prices collapsed, foreign

merchants and foreign banks stood aside to watch the process and the

seriousness of the situation threatened to promote agrarian unrest. It was now

very evident that the government of Pakistan could not afford to continue that

the special mission to Delhi had failed, Government of Pakistan moved

quickly. Two ordinances were passed immediately, one setting up the Jute

Board and other National Bank of Pakistan. The objective of the Jute Board

was to re-organize and rehabilitate the jute trade by helping parties to handle

it and to stabilize the market. National Bank of Pakistan was established to

provide finance to suitable parties.

Thus it came about that National Bank of Pakistan stood behind the jute trade

and State Bank of Pakistan behind the National Bank, and government stood

behind the State Bank. It was all organized so rapidly (six branches came into

being at once) that any doubt that might have lurked in the minds of outsiders

about Pakistan’s ability to tackle the situation were dispelled once and or all.

Until June 1950, the Bank was engaged exclusively on jute operation.

Thereafter, it was felt that it could expand its business to include other

commodities as well. Bank took a big stride in 1952, when it replaced the

Imperial Bank of India, as an agent of State Bank of Pakistan. Presently, there

are 24 overseas branches, and 11 regional offices, 1250 Domestic branches

of the National Bank of Pakistan.


VISION

To be recognized as a leader and a brand synonymous with trust, highest

standards of service quality, international best practices and social

responsibility.

MISSION STATEMENT

“To make the Bank complete and competitive with all international

Standard in performing, quality of, operations, staff, financial strength.

And products and services To develop a culture of excellence in every spare

of activity of the bank.

CORE VALUES

Highest Standard of integrity

Institutionalizing a team work and performance culture

Excellence in service

Advancement of skills for tomorrow’s challenges

Awareness of social and community responsibility

Value creation for all stakeholders

GOALS

To enhance profitability and maximization of NBP share through increasing

leverage of existing customer base and diversified range of products.


3. BUSINESS OPERATION

3.1) ORGANIZATIONAL CHART


PRESIDENTPRESIDENT

EXECUTIVE VICE PRESIDENTEXECUTIVE VICE PRESIDENT

VICE PRESIDENTVICE PRESIDENT

ASSISTANT VICE PRESIDENTASSISTANT VICE PRESIDENT

OFFICER GRADE IOFFICER GRADE I

OFFICER GRADE 2OFFICER GRADE 2

OFFICER GRADE 3OFFICER GRADE 3

MESSENGERMESSENGER

PEONPEON

SWEEPERSWEEPER

BR

AN

CH

HIE

RA

RC

HY

BR

AN

CH

HIE

RA

RC

HY SENIOR VICE PRESIDENT

SENIOR VICE PRESIDENT

MEMBER BOARDMEMBER BOARD

SENIOR EXECTIVE VICE-PRESIDENTSENIOR EXECTIVE VICE-PRESIDENT

National Bank of Pakistan’s Facilities

In January 1964, the bank started its well-known people’s credit scheme. The

scheme was designed to provide financial assistance to the smaller

businessmen on easy and liberal terms. It was welcomed all aver the country

and has been of considerable service ever since. It’s major objective was to

build a strong middleclass, which is a powerful guarantee of social stability in

an otherwise uncertain world.

Along with the social activities as an agent of State Bank of Pakistan, National

Bank of Pakistan has also been a good banking institution to be compared

with other commercial banks. It is providing the modern unmatched banking

facilities such as:

Deposit security; Guaranteed by Government of Pakistan.

Largest contribution towards Government and Semi-Government

requirements.

Agent of the State Bank of Pakistan for handling Treasury Functions

receipts of Taxes and other Revenues.

Handling of salaries and pensions of country’s federal/ provincial

government employees and defense personnel.

Utility Bills collection.

Evening banking at selected branches.

Corporate Branches with premium banking facilities for corporate

clients.

Efficient home remittance services.

ATMs providing round the clock access to accounts.

SWIFT offers quick service in the areas of remittances and trade

finances.

Rupee Travelers cheques


National Bank of Pakistan with its Head Office in Karachi operates through 9 regional

Headquarters. A Board of Directors, appointed by the Federal Government, manages

the Bank. The Regional Headquarters are headed by Regional Chief Executives

(RCEs). Next controlling unit is Zonal Chief Office, which comprises group of

branches working under his jurisdiction.

3.2) DEPARTMENT OF NBP MAIN BRANCH MULTAN

I worked in the following departments during my internship:

Account Opening

Deposits

Credit and Advances

Foreign exchange

Remittances

Government

3.2.1) ACCOUNT OPENING DEPARTMENT

Borrowing funds from different sources has become an essential feature of

today’s business enterprises. But in the case of a bank borrowing funds from

outside parties is all more vital because the entire banking system is based on

it. The borrowed capital of a bank is much greater their own capital. Banks

borrowing is mostly in the form of deposits. These deposits are lent out to

different parties. Such deposit creation is done through opening an account in

the bank.

TYPES OF ACCOUNTS

In NBP, there are the following types of accounts:

Current Account.

Saving Account.


Term Deposit.

Current account

In current account there is no interest on it. It is for only transaction purposes.

They are paid on demand. When a banker accepts a demand deposit, he

incurs the obligation of the paying all cheques drawn against him to the extent

of the balance in the account. As there is no profit paid on this account it is

also called checking account because cheques can be drawn on it. Current

account is mostly opened for business. The minimum amount for opening the

account is Rs.1000/-.

Saving account

The purpose of this account is to induce the habit of saving individuals in the

neighborhood. The profit on PLS saving Accounts in NBP is checking

accounts paid on the basis of profit and loss calculated after six month. The

minimum deposit for opening the account is Rs.1000/-.

Term deposits

A term deposit is a deposit that is made for a certain periods of time (not more

than 5 years). At the end of the specific period, the customer is allowed to with

draw the principle amount.

The term deposit account rate varies after six month and rate is depend upon

the period of term deposits, as period is increased the rate is also increased

and the minimum balance requirement is Rs.1000/- but no maximum limit.

Prior A/C is not required for term deposits.

The amount of profit is given to deposits in three ways:

By cash.

By sending a bank draft to depositor’s home address or office or

whichever is specified as mailing address.

The amount is credited in any one of the checking accounts of the

depositor.


LETTER OF THANKS

At the end, after opening the account, NBP issues letter of thanks to “Account

opener” and “Account introducer” for the trust they have on NBP at the same

day. The purpose of this letter is to check the address of both the parties for

future contact.

Another responsibility and function of account opening

department

Receiving inward checks

Another responsibility and function of account opening department is to

receive inward cheques for collection from other banks as well as of NBP.

Then these cheques are sent to clearing official who clears these checks at

SBP from other banks.

Cheque-book issuing

Check books are issued only for checking account such as current account,

saving account. They are not issued for other fixed and term deposits

because of their long-term account’s nature.

When an account is opened, chequebook is usually issued the next day,

however they too are issued on the same day of opening the account keeping

in view the energy requirements the account holder.

Chequebook leaves vary with the nature of the account. For example, 50

leaves and 100 leaves chequebook are issued for current accounts

depending upon the energy of the account holder. Where as 10 or 25 leaves

chequebook are for saving accounts. 10 leaves chequebook are handed over

to “easily individual’s account, holder”.

Issuing Procedure

Signatures on chequebook requisition are verified by matching with

signatures on SS Cards.


Chequebook leaves number, account number, account holders’ name are

mentioned in the chequebook issue register and take the signature of the

account holder.

The name of A/C holder and date of chequebook issuance is written on

chequebook requisition and the account opening officer puts his initials on

requisition leave.

A/C number is stamped over the leaves of cheque-book and finally

authorized person affix his signature over the debit voucher of the excise

duty and he voucher is attached from the cheque-book and is handed over

to the customer.

Everyday posting

At the end of each day, posting of Cheque-books is performed, the account

department makes credit vouchers of excise duty on Cheque-book leaves,

and posts it in the company.

LOCKERRS

Locker services are provided by the banks in order to provide the customer a

safe place where they can keep their precious documents, things, like jewelry

which can be dangerous for robbery and theft to keep in the house. Against

these locker service the bank take certain charges. NBP also has a great

number of lockers in most of its branches.

NBP has three main types of lockers.

Small Size Lockers.

Medium Size Lockers.

Large Size Lockers.

Locker charges vary with the size of the lockers. Locker charges are half for

the employees of the National Bank to the normal charges charged to the

customers. Recently locker charges have been reduced by 25% as previous.


3.2.2) DEPOSIT DEPARTMENT

Cash department is very sensitive and risky part of the bank. Very cautious

and competent personnel are needed for the job. NBP has really such a

diligent staff with appreciable competencies and will to do work.

Main function of deposit department is to deal with cash payment and cash

receipts.

CASH DEPOSIT

There are two types of deposit slips; Red slip is for Cheque deposit, where

Green slip is for cash deposit. If a customer comes to deposit cash in his

account the procedure is as followed in this case:

CASH PAYMENT

When a customer comes to withdraw a certain amount from his account, he

brings a Cheque along with him. In this case the following steps are taken.

Procedure

The cashier receives the Cheque and checks it whether it is posted or

predated. Cheque can be cashed within six months. A repeated

Cheque cannot be cashed.

He takes two signatures at the back of the Cheque from the bearer.

He gives the Cheque for 'posting “at the computer. The computer

checks out whether there is balance in the account or not. Other

instructions are also received e.g. blocked, frozen, etc. The posting is

done in the computer and the Cheque is stamped “posted" with the

serial number and date and the token is issued to bearer.

The cashier counts the cash and makes the detail at the back of the

Cheque.

The cash is paid to the person and the Cheque is stamped “Cash Paid"

immediately.


The entry is made in the Paying Cash book and the Serial number is

written on the Cheque.

Types of Cheques

In Pakistan, banks deal with two types of cheques:

Open Cheque—they are payable in cash at counters.

Crossed Cheque—they are not payable in cash at counter.

Open Cheque

The Branch has online computer system, hence firstly he check the balance in

his account by giving the account number and check the title of account as

well, and debit the account by the mentioned amount. When Cheque is found

in order, the token clerk affixes “Token Stamp” on the Cheque, writes the

token number on it and puts his initial there and after this token is given to the

presenter and Cheque is handed over to the authorized officer for further

processing.

Crossed Cheque

The customer of the branch deposits the Cheque drawn on same branch, for

payment to be credited into his account, attached with pay slip. Signs it. Then

he checks the balance in the account if the account has sufficient balance, he

passes the Cheque and the account is debited by the mention amount and

account of the depositor of Cheque is credited by the same amount. The

Cheque is treated as debit voucher and pay slip, credit voucher. The

information about the both is mention is Transfer Voucher Sheet.


3.2.3) CREDIT AND ADVANCES DEPARTMENT

The earning of a commercial bank are chiefly derived from interest charges on

loans and discounts it. Now loans are recognized as advances or finances.

The advances are made through the deposits that are kept in the bank by the

customers. The bank pays profit on the deposited amount and receives mark

up on the advances made of different amounts.

CREDIT PRINCIPLE

The following principles are to be adopted for lending authority, approval,

monitoring and control on a basis consistent with NBP’s operational objectives

and business stages.

Objectives

Providing suitable credit services and products.

Not compromising NBP’s standards in extending credit.

Transactions, which don’t apparently exhibit adequate commercial

consideration, will not be undertaken accept when authorized by the credit

committee/president

Structure

The authority structure should enable effective adoption to changes in the

economical, technological regulatory and competitive environment.

Performance

The education and admission of the loan portfolio should conclude with in

defined and acceptable risk limitation toward attaining satisfactory return on

the bank’s capital. Credit advancement shall focus on the development and

enhancement of customer relationship and are measured on the basis of the

net yield for each customer relationship where individual transaction should

also be profitable


Credit report

The report is prepared by bank of the intending borrower with a view to

considering his Credit Worthiness and Eligibility for the Bank Finance.

Besides other things it contains the net worth of the borrower.

TYPES OF FINANCES

Finances can be classified into two categories:

Clean Finances.

Secured Finances.

Clean Finances

Clean Finances are those finances, which are allowed to govt. employees,

against their salaries. The limits of the Clean Finances are up to 20 basic pay,

and are required to repay within 5 year.

Legal Documentation

Formal request for grant facility.

Authentic proof from the concerned department about his salary.

N.I.C.

Undertaking from the employee that the salary for the applicant shall

be remitted to the branch and in case of clients inability to repay the

finance the same would be adjusted from his dues.

Sanctioning of the loan.

SECURED FINANCES

Secured finances are those finances against which security has been

pledged. Security can be the property, stocks, deposits, prize bonds,

hypothecation charges, shares, mortgages on tangible readily reliable

unencumbered assets, and govt. securities.

Secured finances are of the following categories:


Running Finance.

Agri. Finance.

Demand Finance (Gold Finance).

Cash Finance.

Small Finance.

These are also known as the short-term finances.

Running Finance

Running Finance is a short-term finance, one year of payment, to assist a

large-scale business operator to carry on his day-to-day requirements of liquid

funds. This account is opened to made operations in his favor or course all

disbursements are made under proper consideration of the securities and 4

C’s of the borrower. Bank retain 25% margin on the Running Finance, means

that if security has a value of Rs.100000 then against it Rs.75000 has been

financed by the bank. The mark up rate on the Running Finance is Rs.0.4384

paisa/1000/day.

SecuritySecurity

Running Finance can be against the following securities:

Bank’s Deposits.

National Defense Saving Certificate.

National Investment Trust Units.

Life Insurance Policy.

Shares of Joint Stock Companies on Bank’s approved list.

Prize Bond.

Agri. Finance

Now a day Agri. Finance has been included under the category of the

Running Finance. Basically there are two types of Agri. Finances:

Agri. Finances for Crop.

Agri. Finances for Development.


For the development and expansion of the most participative sector of our

economic prosperity, the National Bank of Pakistan has been providing loans

and finances to the agricultural sector since its establishment. Agri. Finances

for crop is called as short term finance that is provided to carry on the

operational requirements of the Agri-business such as purchase of seeds,

fertilizers, pesticides, and other seasonal requirements of the farmers till the

final activities to make the product reach to the market. This finance is

provided to cover a period of less then one year.

The other type is long term, which is provided, or the purchase of Agri-

machinery and other heavy equipment (tractor, harvester) that are used for

the reclamation of the Agri-land. But these equipments have registration joint

with the bank. This finance is provided more than one year.

SecuritySecurity

Personal guarantee (personal identity).

Third party guarantee.

Against third party guarantee.

Mortgage of immovable property.

Against Agri. Pass Book.

DocumentationDocumentation

Formal request

Term deposit Receipt duly discharged by the client.

Letter of undertaking.

Mark Lien by the Patwari and verified.

Property Valuation Certificate issued by the Bank Engineer.

Copy of extracts of form City Survey or maturation record.

Certificate of Title Clearance issued by the Bank’s law Officer.

Non-Encumbrance Certificate.

Search Certificate issued by the Registrar Joint Stock Companies.

Insurance Policy Premium paid with Bank Mortgage Clause.

Original sale deed.


On Objection Certificate issued by form co-operative Society to the

effect that the borrower is not indebted to the society.

Short term Agri. Loans has different financing limit and depend of the nature

of the crop and area covered by the crop. In case if some crop is destroyed by

rain or some other reason then the payment of the loan may post pone and

the repayment may be extended by the concerned authority. Or in some

special case the loan may be forgiven to the farmer.

Demand Finance (Gold Finance)

The Demand Finance is a one transaction finance, means that once he

withdraw the amount and after when submit the amount then he can never be

withdraw again. Demand Finance has 9 – 15 month duration. The mark-up or

interest is calculated on the total amount disbursed and requires to be paid

before the date of final adjustment.

SecuritySecurity

Demand Finance are given against Gold ornaments. Bank make their self

secure by taking 50% margin, because of mark-up (18%), default risk,

impurities, and in case of auction sale of the gold sales tax (18%).

OperationOperation

Request for the loan.

Assessment.

Sanction of the loan.


Letter of introduction

Gold loan insurance letter.

Delivery letter for Gold ornaments cum evaluation certificate (F – 205).

Gold smith’s weight (net weight) quantity and quality

valuation certificate.


Cash Finance

This finance is normally used by small businesses or individuals for their petty

matters involving cash transactions, up to a maximum of rupees three

hundred thousand. These are normally for the seasonal business like cotton,

which have 6-8 month business. The mark-up / interest is calculated on the

amount outstanding on his account. The calculation of mark-up / interest is

based on the number of days a specific amount is withdrawn.

SecuritySecurity

Pledge of stock.

Third party guarantee and Hypothecation of stock.

Pledge of stock & collaterally secured by third party’s guarantee.


Formal request for the facility.

Insurance policy.

Letter handling over physical possession of the Godown by the

borrower.

F – 218 Letter acknowledging Bank’s Lien in the stock stored (taken

from Godown owners).

Letter from client authorizing the Bank to Debit salaries of Godown staff

to his account.

Resolution to be obtained from the limited co. covering operations on

an account.

Resolution to be obtained from the limited co. covering authority to

Directors to execute documents.

Certified copy of Memorandum and Articles of Association.

Certificate of Incorporation.

Certificate of Commencement of business (in case of public limited).

Resolution passed by the board of Directors for the grant of Cash

Finance facility.

Balance sheet (audited).


Small Finance

Small Finance is normally for the expansion of the business. In Small Finance

Hypothecation is in the custody of the owner. Where as if the security is

pledge then it will in the custody of bank.

SecuritySecurity

Hypothecation.

Pledge.

Stock.

Mortgage.

Vehicles.


Formal request for the facility.

F – 53 along with partnership letter.

Partnership deed.

Letterform client authorizing the bank to debit salaries of Godown staff

to his account.

Letter signed by the client authorizing the bank to debit his for the

payment made in respect of insurance premium.

Insurance policy in favor of bank.

Registration in the Joint names of the bank and the borrower.


Along with NBP the Government of Pakistan (GOP) supports:

1. Life and disability insurance paid by GOP with no medical examination

required.

2. 6% mark-up paid by customer, rest paid by GOP.

* Subject to availability of subsidy/confirmation from GOP.

Note: The mark-up rate will be revised on annual basis.

FINANCING TERMS & CONDITIONS

Minimum Down Payment

10% of asset price (5 % for PCO and Tele center)

Mark-up Rate Variable

1 year KIBOR + 2% (For the first year mark-up will be 12%) The customer will

pay markup @ 6%p.a as long as GOP provides the balance markup to NBP

on a monthly basis)

Tenure

1 to 5 Years (for PCO 2 years)

Grace Period

Initial 3 months

Maximum Loan Amount

Rs. 200,000/-


NBP KARPBAR UTILITY STORE

(Under a Franchise with Utility Store Corporation)

Financing will be provided to set-up a Utility Store under franchise of Utility

Store Corporation through

• Set-up of a Utility Store in an owned/rented shop

• A 'Mobile' Utility Store: 4 stroke Petrol/CNG/LPG Vehicle (Rickshaw)

Eligibility Criteria

• Must be Pakistani national bearing a Computerized NIC

• Age between 18 to 45 years

• Must be residing in the same city / district for the last 2 years

• Must have a franchise from Utility Stores Corporation of Pakistan

• Must have a valid rickshaw driving license (for mobile utility store)

• Availability of 2 references & 1 guarantor (USC shop setup

• No default or rescheduling history of the applicant

• References and guarantor must be residing in the same city / district

where the applicant is residing

Security

In case of Utility Store shop set ups:

• Hypothecation charge over the present and future assets in store (except

stock).

• One guarantor, having minimum net income of Rs. 10,000/-p.m.(subject

to NBP verification) or must be property owners

• Personal guarantee of the applicant

• 4 cross cheques

In case of Mobile Utility Stores:

• A lien would be marked under hire purchase/hypo agreement on the

vehicle


• 4 cross cheques


NBP KAROBAR MOBILE GENERAL STORE

Financing will be provided to purchase 4 stroke Petrol/CNG/LPG Vehicle

(Rickshaw) with attached loader body (Thehla type) to set up Mobile General

Store without USC Franchise.


• Must be a Pakistani national bearing Computerized NIC


• Must be residing in the same city/ district for the last 2 years

• Availability of 2 references


• References must be residing in the same city / district where the applicant is

residing

Security

• A lien would be marked under hire purchase/hypo agreement on the vehicle


• 4 cross cheques

NBP KAROBAR TRANSPORT

Financing will be provided to purchase a 4 stroke Petrol/CNG/LPG Vehicle

(Rickshaw)


• Must be a Pakistani national bearing Computerized NIC


• Must be residing in the same city / district for the last 2 years

• Availability of 2 references having landline telephone numbers



residing

Security

• A lien would be marked under hire purchase/hypo agreement on the vehicle



• 4 cross cheques

Women and Poverty

Women of today is not the women of yesterday she is more knowledgeable

more confident and more dynamic. To salute the women of Pakistan, NBP

introduces loan products for the women of Pakistan to bring them out from the

hardships of poverty, through the following self-employed schemes of NBP

Karobar.

NBP KAROBAR PCO

Finance will be provided to purchase Wireless/ Mobile/Desktop telephone

set(s) with prepaid connection and credit balance(s) to establish a PCO setup


• Must be Pakistani national bearing a Computerized NIC


• Must be residing in the same city/ district for the last 2 years

• Availability of 2 references & 1 guarantor

numbers



residing

Security

• Hypothecation charge over the present and future assets of the business

• One guarantor, having minimum net income of Rs. 10,000/- p.m. each

(Subject to NBP verification) or must be a property owner for single telephone

set minimum income requirement for guarantor is Rs. 5,000/- per month and

for multiple sets Rs. 10, 000/- per month.



• 4 cross cheques

How to Apply For NBP Karobar

Customer to visit any NBP branch to obtain loan application form and

scheme details. Application form could also be downloaded from the

NBP web site. Photo copy of the form will also be accepted. Each form

will cost Rs. 5. In case of photocopy or down-loaded form, form fees

will be charged at the time of application submission

Branch to provide details of the scheme along with the required

documents to be submitted with the application form

Customer to submit the application form along with all the required

documents as well as the verification and the processing fees

The application form and all the relevant papers of the customer will be

checked by the Branch staff and if found complete, application

processing will commence

If the case is approved then the customer will be informed accordingly

and will be advised to deposit the Down payment and fulfill all the other

product specific formalities

Upon fulfillment of all the details and approval of the loan by the

competent authority, Purchase Order in favor of vendor will be issued

and a copy of the same will be given to the customer

Delivery of the financed asset will be made directly to the customer by

the NBP selected vender

3.2.4) Foreign Exchange Department

o promote flow of foreign exchange in the country, the Government of

Pakistan started a new scheme of opening of bank accounts in

foreign currency. These accounts were entitled to receive profit TINTERNSHIP REPORT 32

percentage in shape of the currency in which the account was kept (Dollar

account shall be paid profit in dollars). This has increased the flow of foreign

currency especially from the Pakistani foreign residents, who used to send

money to their families at home.

Functions of Foreign Exchange Department

Foreign exchange department is controlled by OG-III. This department

performs different functions such as:

Foreign Currency Deposits.

Imports.

Exports.

Foreign Remittance.

FOREIGN CURRENCY DEPOSITS

To earn foreign exchange NBP offers different types of account such as:

Types of Foreign Currency Account

The National Bank of Pakistan is currently providing foreign currency

accounts services in four currencies:

US Dollars

Pound Sterling

Dutch Mark

Japanese Yen

Foreign currency accounts can be operated by Pakistani residents abroad as

well by residents at home, plus foreign nationals who are residing in Pakistan.

The opening of foreign currency goes through the same kind of process that is

used for opening of an ordinary deposit account. A prescribed form has to be

filled as an application for opening of account. Personal identification card and

introducer is required who can be an old account holder with the Bank or an


officer of the Bank. Foreign Currency accounts can be opened in following

three types.

Foreign Currency Current Account

Foreign Currency PLS Account

Foreign Currency Fixed Deposit Account

Foreign Currency Current AccountForeign Currency Current Account

Foreign currency current account can be opened with a minimum balance of

$500. This account is not entitled to any profit.

Foreign Currency PLS AccountForeign Currency PLS Account

Foreign currency PLS account require $100 for opening and this account is

eligible to share the profits and losses at the rate that is prescribed by the

Head office from time to time.

Foreign Currency Fixed Deposit AccountForeign Currency Fixed Deposit Account

In this type of account the deposits are accepted for a period of minimum 3

months and maximum up to 3 years. The profits are credited to the accounts

after every six months on a rate that is ascertained by the Treasury Division of

the National Bank of Pakistan Head Office Karachi. The profit is provided on

daily product basis, which means that profit is credited based on the balance

in the account and the number of days it has remained in the account.

Profit On Foreign Currency AccountsProfit On Foreign Currency Accounts

The profit on foreign currency accounts is paid only on the US Dollar account

and Pound Sterling account. The other two currencies are not entitled to

receive profit on the balances. The profit for the half-year ended June 30,

2001 has been declared at the following rates:

Currency nameCurrency name New AccountNew Account Old AccountOld Account

US Dollar @ 1.250% @ 2.2350%

Pound Sterling @ 1.175% @ 1.878%


The Bank maintains separate ledgers for every type of currency account. The

most significant accounts with the Bank, in number and frequency of

transactions, are US Dollar and Pound Sterling. That is the reason these

accounts are made eligible to share the profits.

3.2.5) REMITTANCE DEPARTMENT

Remittance department provides services to the customer of the bank. The main

function of this department is transfer of funds.

INSTRUMENTS OF BILLS AND REMITTANCE DEPARTMENT

The instruments that are handled in the Remittance department are as follow:

Demand Draft.

Mail transfer.

Telegraphic transfer.

Pay order.

DEMAND DRAFT

A demand draft is an instrument, which is drawn by one bank upon another

bank for a specific sum of money payable on demand. It is made by the bank

and given to the purchaser against cash or Cheque. If two banks are involved,

then one banks sends a DD to anther bank. But in customer – Bank case the

customer sends his DD to the receiver.

MAIL TRANSFER

A Mail Transfer is mode of remittance that is used for transfer of money in

case the responding branch is of the same bank, which is issuing the MT.

Simply to say, all inter-branch transfer are done through MTs. A MT does not

need an advice to be sent because the amount of MT is directly credited to

the account of the payee. So it is an easy mean to transfer the amount from


one account to the other account with in the same bank but different

branches.

TELEGRAPHIC TRANSFER

It is said to be the fastest mean of transfer of funds from one place to the

other. In this method a Telex message is used to make an order of payment

of the responding branch. It is a costly mean and the charges are

comparatively higher than other means.

PAY ORDER

It is a cheque drawn by a bank on itself. Pay order is an instrument in which

three parties are involved, the purchaser, the bank and the receiver. Any

customer can purchase it. It is usually made by govt. Bodies. A single bank is

involved in this case.

OTHER FUNCTIONS

BALANCING THE REGISTER

At the end of the day, all the registers are balanced with the computer

balances. The heads are as follows.

DD payable.

TT payable.

MT payable

If the payables are not cleared for a lot of days, a reminder is sent to the

respective branches.

3.2.6) Clearing Department

There is no legal obligation on a banker to collect cheques drawn upon other

banks for a customer. However it is function of almost every modern bank of

the collection of cheques and bills on behalf of the customer.


Clearing department services are provided in order to make arrangements for

the economic collection of the cheques, DD and other negotiable instruments.

A large part of this work is carried on through the clearinghouse.

ROLE OF THE CLEARING DEPARTMENT

Suppose X is an account holder of NBP, and he has to pay Rs.2, 000/- to Y

who is an account holder of MCB. X draws a cheque in favor of Y and gives it

to Y. Now Y instead of coming to NBP for payment, deposit the cheque at

MCB. The MCB clearing members will bring those cheques to the

clearinghouse and gives it to NBP clearing members. The NBP clearing

members brings it back to the bank and checks the validity of the cheques

and in the second clearing the MCB members told that his cheque has been

cleared.

Book keeping

There are three registers in this department:

Clearing summary register.

Inward clearing register.

Outward clearing register.

Clearing Summary RegisterClearing Summary Register

In this register the clearing summary balance is made. The received cheques

and the delivered cheques are written in the respective columns.

Inward Clearing RegisterInward Clearing Register

The inward clearing register used to write the details of the inward cheques

cleared. Inward cheques are those cheques, which have been recovered from

the different banks. The amount of these will be credited SBP Account, so

these cheques are against us and have a negative effect.

Outward Clearing RegisterOutward Clearing Register

The outward clearing register is used to write down the detail of the outward

cheques. Outward cheques are those cheques, which have been delivered to

different banks. The amount of these cheques will be debited to SBP account

so these cheques are in favor of us and have a positive effect.


Different instruction is dealt in he clearing department. All negotiable

instruments e.g.

Cheques

Pay slips

Pay orders

Term deposits

In order to make arrangements for the speedy and economic collection of

cheques, bills and other documents payable or deliverable at offices of

clearing house. State Bank of Pakistan provides clearing services in all the big

cities. Where State Bank of Pakistan has no office then NBP act the role of

clearing house.

3.2.7) GOVT. DEPARTMENT

Govt. Section is situated in the basement of the regional headquarter of NBP.

It is supervised by Mr. Ali. A young energetic and dedicated person.

THE MAIN FUNCTIONS OF THE GOVT. SECTION ARE:

Collection of utility bills i.e. telephone, electricity and sui gas Collection of

Government Taxes i.e. excise duty, traffic challan, Passport Collection Fee,

sales tax, income tax, withholding tax, property tax Payment of salaries

Payment of Zakat Disbursement of pension


FINANCIAL ANALYSIS


BALANCE SHEET

Assets 2006 2005

Rupees in

000

Cass and balance

with treasury banks 78625227 71196956

Balances with other banks 40641679 31019330

Lending to Financial Institutions 23012732

16282942

Investments 139946995

156985378

Advances 316110406

268838779

Operating fix assets 9681974 9454365

Other assets 27113698 23941056

Total Assets 635132711

577718806

Liabilities

Bills payable 10605663 1741156

Borrowings 11704079 8756847

Deposits and other accounts 501872243

463426602

Liabilities against assets

subject to finance lease 13235

16629


Deferred tax liabilities 2387073 4462718

Other liabilities 26596300 23496910

Total Liabilities 55317859375817944

Net Assets 81954118 75818944

Share capital 7090712 5908927

Reserves 13879260 12354256

Unappropriated profits 32074677 19372523

53044649 37635704

Surplus on revaluation

of assets 28909479 38182238

Total equity 81954118 75817944

Total Liabilities and equity 635132711

577718806


PROFIT AND LOSS STATEMENT

Rs in thousand 2006 2005

Markup/return/interest

earned

43788628 33692665

Markup/return/interest

exp

13634912 10321768

Net Markup/return/interest

earned income

30153716 23370897

Provision against non-

performing loans and advances

3075723 2446739

Provision for impairment

in the value of investments

-709461 -245881

Bad debts written off directly 5284 23069

2371546 2223927

Net markup/interest income

after provisions

27782170 21146970

Non-markup/interest

income

Fee, commission and

brokerage income

6144628 4926604

Dividend income 2891755 1718478

Income from dealing

in foreign currencies

1333840 1205638

Gain on sale of securities-net 1179515 1365771

invest classified held

for trading

-4464 -1979

Other income 627618 170839

Total non-markup/

interest income

12162892 9392351


39945062 30539321

Non-markup/ interest

expenses

Administrative expenses 13443441 11221789

Other provisions/write offs -17283 198298

Other charges 208327 63206

Total non-markup/interest

expenses

13634485 11483293

Profit before taxation

Taxation 9288231 6346584

Profit after taxation 17022346 12709444

Inappropriate

profit brought forward

19372523 10885184

Profit available for appropriation 36394869 23594628

Basic earning per share 24.01 17.92

Diluted earning per share 24.01 17.92


FINANCIAL RATIOS


1. LIQUIDITY RATIOS:

(a) Net Working Capital=current assets- current liabilities

2006 = 433218792 – 518336004 =-85117212

2005 = 411289063- 497421515 =-86132452

(b) Quick ratio = Cash + Cash

equivalents

Current liabilities

2006

= 78625227 =.15

518336004

2005

= 71196956 =.14

497421515

(c) Current ratio = Current assets

Current liabilities

2006

= 433218792 =.84

518336004

2005

= 411289063 =.82

497421515

Bank’s net working capital has been decreased this year from the previous

year that shows that their current liabilities are more than the current assets.

We can say that their working capital is


Negative. It is a good for the bank as it shows the increase in interest of

customers on bank. But it will also increase the risk, as it will decrease

liquidity.

Bank’s quick ratio that tells that the bank can pay its short-term obligations

within 3 months has been increased this year from the previous year. It is also

good for the bank.

Current ratio indicates bank’s ability to meet short obligations. Current ratio

has improved as compared to last year. This increase is due to increase in

loans to financial institutions. This positive increase is good for the company.

2. Activity Ratios:

(a) Total Assets Turnover= mark up earned

Average total assets

2006

= 43788628 =6.89%

635132711

2005

= 33692665 =5.83%

577718806

Total assets turnover indicates the efficiency with which the bank uses its total

assets to generate mark up. a specified period of time has been increased

this year to 6.89%that shows that the bank had generated more this year by

using the assets of the bank.

3. Leverage Ratios:

(a) Debt ratio = Total Debt

Total Assets

2006


= 553178593 =87%

635135711

2005

= 501900862 =87%

577718806

(b) Debt Equity ratio = Total Liabilities

Common Equity

2006

= 553178593 =674%

81954118

2005

= 501900862 =761%

75817944

(c) Times Interest Earned Ratio

= Earning before Interest & Taxes

Interest Expense

2006

= 26310577 =1.93

13634912

2005

= 19056028 =1.85

10321768

Leverage ratio or debt ratio tells the degree of indebt ness of the entity. This

means against liability of 0.87 rupee, bank has 1 rupee of assets to satisfy it

and this is a good sign.

Debt equity ratio decreased as compared to previous year, which indicates

that less equity is used to finance the total assets as compared to last year


Times interest earned ratio tells the relationship between EBIT and the

interest paid of specific time period. This year this ratio has been increased

that shows that they are paying more portion of interest relating to the

previous year.

4. Profitability Ratios:

(a) Gross profit margin = Gross Profit

Total net sales

2006

= 30153716 =68.86%

43788628

2005

= 23370897 =69%

33692665

Gross Profit ratio measures the percentage of each rupee earned from

revenues remaining after the cost of goods has been paid. A decrease in this

ratio is observed as compared to last year.

(b) Profit margin = Net Profit

Total revenue

2006

= 17022346 =38.87%

43788628

2005

= 12709444 =37.72%

33692665

Net profit ratio shows the earning available for distribution

among the shareholders. The ratio has slightly increased

(c) Return on assets = Net Income


Average Total Assets

2006

= 17022346 =2.68%

635132711

2005

= 12709444 =2.19%

1577718806

Return on assets that tells the profit the bank earned on the use of the assets

has

decreased this year relating to the previous year.

(d) Return on common stock equity = Net Income

Common Equity

2006

= 17022346 =20.7%

81954118

2005

= 12709444 =16.76%

75817944

Return on equity that tells the profit generated through use of common equity

has been increased relating to the ratio of the previous year.

(e) Return on deposit = NPAT

Deposits

2006

= 17022346 =3.39%

501872243

2005

= 12709444 =2.74%

463426602

Net profit after taxes to deposit ratio is increased which

shows the worthiness of bank among the customers.


5. Marketability ratios:

6.

(a) Earning per share = Net Income-Preferred dividend

Common Stock Outstanding

2006

= 1722346 = 24.01

709071

2005

= 12709444 = 17.92

5908927

Earning per share ratio tells the earning by one share of common equity. This

ratio has increased related to the previous year indicating that each share is

generating more profit than the last year.

(b) Book value per share

= stockholders equity- preferred stock

Common Stock Outstanding

2006

= 81954118 =11.5

7090712

2005

= 75817944 =12.83

5908927

Book value per share tells the value of the share on some specific period of

time. Book value per share has decreased this year relating to the previous

year.


FINDINGS

The increase in Current Ratio from 0.82 to .84 is showing that the bank

is increasing capacity of meeting its short-term obligations. As per the

regulations of SBP, this Ratio must not be lower than 1:1.

The bank’s debts are 6.74 times its Equity. Bank is getting sufficient

return on its assets i.e. 2.68% as well as on its equity i.e. 20%.

The Income Statement is showing an upward trend as compared to the

previous year. The Net Profit has comparatively increased by 33%

The Operating Cash Flows of the company were negative in 2005but in

2006 they are positive. It is mainly because of management’s control

over expanses and profits earned and retained.

Cash Flows from Investment activities are negative and those from

financing activities are negative too. It means that bank1 has made

Capital investments, on the other hand, has paid its liabilities.

Net Cash Flow for the current year are negative which means that

outflows are greater than Inflows but it is good because company has

generated from Operating Activities and has made investments and

paid its Liabilities.


3.3) SWOT ANALYSIS

STRENGTHS

Public confidence

Sound financial strength

Highest profitability

Vast operational network

Role in economic development

Utility bills collections

Corporate branches

Evening banking

Efficient home remittance

Recognition of hard work of staff

SWIFT

Internet access (www.NBP.com.pk)

Pension & salaries payments

Online city branch

Pension & salaries payments

Online city branch

WEAKNESS

Poor quality counter services in branches which are not online

Outdated system & procedure

Lack of good delegation


http://www.nbp.com.pk/

Inadequate, poorly placed network technology

Poor MIS

Deep rooted bureaucratic approval

Poor maintenance & implementation

Lack of long term & short term plans

Less share in import & export business

Poor resource utilization

Need better service policy

Frequent change in senior management

Opportunities

New style management

Introduction of new products and services

Introduction of new technology & electric banking

Capital management & equity financing

Secondary market operations

New deposit scheme

Leasing

Threats

Establishment of new private financial institutions & expansion

Govt. sponsored schemes

Political pressure

Reducing branch network

New products form private Pakistan Establishment of new private

financial institutions & expansion

Non-banking institutions

Inability to change


SUGGESTIONS & RECOMMENDATIONS

Based on the SWOT analysis of the National Bank of Pakistan. There is a

long list of weaknesses that is given on the previous page. Most of them are

going along since long time and that all efforts made to remove them have not

succeeded. On the basis of SWOT analysis of the Bank the following

suggestions and recommendations are given.

Bank should try to get rid of the political influence to be able to

compete in the industry with prudent and strong policies.

Redefining of rules, regulations and policies should be made

implemented at all costs.

Efforts of great importance to be made for the over the counter

services of general banking making it more simple and faster to get a

better response of the customers.

The behavior of the employees, especially on the counter has to be

strictly monitored and checked.

The still existed bureaucratic approval system has to be demolished.

All advances should be made by getting the maximum security and

should focus on productive work.

Better and comprehensive long-term and short-term planning should

be made to forecast the future needs.

There is a possibility of establishing a task force to ascertain the

effectiveness of the policies being implemented.

The Bank should develop a comprehensive recruitment policy to make

only the competent ones to be on the job.


There is a still a vast pool of incompetent employees that has to right

sized.

There is a lack of promotional element in the planning and budgetary

decisions of the Bank that has to think seriously.

All branches of the Bank should be computerized for increasing the

effectiveness and efficiency of its employees.

Efforts should be continued to keep the powers of employees union to

the minimum, like the current situation.

Promotions must not be delayed and should be made on time to further

increase the commitment and efficiency of the employees.

These and many others that can make a good set of recommendations, which

have to be made possible to escape from the threats and weaknesses and

the risks in environment that surrounds the Bank. The management do

considers the policy matters that are not helping the Bank, but are still in

practice due the absence of prudentially regulated system to protect them and

the Bank.

Efforts have been made with serious concern to give NBP a status that it has

to maintain by having practices of:

By using computers and technology more efficiently..

By closing unprofitable branches.

By introducing a merit based selection criteria.

Promotions made conditional with qualifications.


4) LEARNING AS A STUDENT INTERN

4.1) DUTIES

i) MY ACTIVITIES IN ACCOUNT OPENING DEPARTMENT

During my internship in this department I was assigned different duties such

as to guide and help the customers to open accounts, to tell them about

different types of accounts with their benefits also about the procedure and

documentation required. I filled the vouchers, application farms, requisitions

for new Cheque books and affixed the stamps on vouchers there.

MY ACTIVITIES IN FOREIGN EXCHANGE DEPARTMENT

Here in that department I learned from Mr. Aziz Baig and Mr. Usman how to

fill the vouchers, the account opening forms, about the procedure of opening

an L.C and about its documentation and processing. Also the procedure for

dealing with inward and outward remittances.

MY ACTIVITIES IN REMITTANCE DEPARTMENT

I was given the tasks such as to guide the customer about the procedure, to

fill the vouchers for the amount and charges, asked the customer for

necessary documents such as I.D card and after payment of these vouchers

by customer make the specific instrument of DD, MT, PO, TT , TC , record it

in their respective ledgers.

MY ACTIVITIES IN GOVT. DEPARTMENT

In Govt. section I was concerned to make scrolls of pension distribution,

passport fee, traffic challans, and utility bills and at the end of the day total


them and check them with counter ledger. And at the end of the day making

debit and credit voucher for government's payment (pension) and revenue

collection. These vouchers are sent to the IT section of the bank where the

corresponding accounts are updated by the amounts of the vouchers. Also to

make entries in the pension ledgers and in the book of the pensioners.

4.3) ACCOMPLISHMENTS

IMPLEMENTATION OF CLASS ROOM LEARNING

The first thing which I noticed is that ground realities are different as

compared to with the theories or some factors which increase this difference

like management practices, economic conditions, political scenario and other

external factors. But still we can’t deny the importance of class room theories

because they help us in great way in understanding the operations of the

bank. The courses of “Management” and “HRM” enable me that how bank

should be reactive toward changes like economic, cultural, and technological

and deals with the issues relating staff. I saw the practical implementation of

“Marketing Management” being followed in retail banking e.g. in new product

development and communicating its features to target audience. The subjects

of International finance and Analysis of financial statements helped me lot

while I was working in the foreign exchange department and while preparing

this report. Also the subject of Accounting and Financial management helps

me while I was working in credit department. The financing process of all

international trade which modern banking made less complicated and more

secure have increased with the global-village concept in the world. For banks

it is an opportunity to grasp the maximum share as possible through being

more efficient to reach the customer.

4.4) NEW KNOWLEDGE ACQUIRED

WHAT I LEARNT IN THE ORGANIZATION


In the organization, my knowledge was very much enhanced. I learnt a lot,

few of which are as: I got the practical experience about how to work in a

professional environment; it gives me the opportunity to shape my behavior,

attitude and my thoughts. I learnt the professional attitude of the people. I also

observed that one must have to be dedicated towards his/her job. I saw, how

much it is necessary to do the job in a friendly environment. What are the

working relationships and responsibilities of supervisors and their

subordinates I observed that how to deal with the customers, what are their

needs and what do they expect from the service provider.

It also helped me to understand the importance of working in different types of

environment and conditions. Overall, I can say that it was my very good

experience of doing my internship in NBP Main Branch Multan.

4.5) HOW EXPERINCE IMPACTS MY CAREER

I learnt a lot, few of which are as: I got the practical experience about how to

work in a professional environment. I can say that it was my very good

experience of doing my internship in NBP Main Branch Multan

This experience is add in my c.v and if I want to apply in banking sector then

this experience is very helpful in my interviews and also have much impact in

my practical life to be professional.


REFERENCES

NAME AND DESIGNATION

Rana Meher Hussain (Assistant Vice President ) Syed Manzar Ali Gillani (Incharge Remittance)Syed Sana ullah Kazmi (Officer Remittance) Muhktar Hussain (P.A to Chief Manager) Muhammad Ali (Govt. Section) Abdur Raheem Bhutta (Remittance Section) Mr. Mirza Aziz Baig (Foreign Exchange)Mr.Syed Ameer Muslim Gardezi (C.F.A)

NAME OF INTERNEE

Muhammad Furqan Umar -------------------------------------------0333-6171345

0302-6171345


BIBLOGRAPHY

1. www.nbp.com.pk

2. Annual report of National Bank

3. Old Internship report 2001


http://www.nbp.com.pk/




Documents

Internship Report Nbp (Final)3