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NBP Internship Report

NBP Internship Report

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Published by SHAHEDMEHMOOD

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Categories:Business/Law, Finance
Published by: SHAHEDMEHMOOD on Oct 21, 2009
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08/17/2013

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INTRODUCTION
INTERNSHIP REPORT ON NATIONAL BANK OF PAKISTAN
INTRODUCTION TO BANKING 
 
There are many definitions of the word “Bank” even the standardencyclopedia and law books find it difficult to state exactly what aBank is.There have been many attempts by different writers to explain theexact significance of the term “Bank”. Here some of the definitions arequoted as follows.
According to the Banking Companies Ordinance 1962”Section 5 (b) defines
 “Banker means a person transacting the business of accepting, for the purpose of lending or investment, of deposits from the public, and withdrawal by cheques,drafts, order of otherwise, and include any post officesaving banks” 
According to Crowther
”Bank is a dealer of debt, his own and of other people.” 
According to Gilbert
 “A bank is a dealer in capital or dealer in money. He is anintermediary party between the borrowers and lenders.” 
According to Samulelson
 “Commercial banks provide certain services for customersand in return receive payments from them.” 
According to Holder
 “The modern banker is primarily a dealer in credit.” 
 
University of the Punjab, Gujranwala Campus
 
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INTERNSHIP REPORT ON NATIONAL BANK OF PAKISTAN
 
IMPORTANCE OF BANKING
We can take bank just like a heart in the economicstructure and capital provided by it is like blood in itBanks play very important role in the economic life of anation. The growth of the
 
economy is dependent uponthe soundness of its banking system. Although banks donot create new wealth but borrow, exchange and consume. Thesemake generation of wealth. In this way they become most effectivepartners in the development of that country.To encourage the habit of saving and to mobilize these savings is itsbasic purpose. Banks deposit surplus from the public and thenadvances these surpluses in the form of loans to the industrialists,agriculturists, businessmen and unemployed people under differentschemes so that they set up their own business. Thus banks help incapital formation.If there are no banks, then there would be concentration of wealth infew hands and great portion of wealth of a country would be idle. Inthe fewer developing countries rate of saving is very low and due tothis, rate of investment and rate of growth is also very low. We cantake bank just like a heart in the economic structure and capitalprovided by it is like blood in it. As long as the blood is in circulation,the organs will remain sound and healthy. If the blood is not providedis not provided to any organ then the organ would become useless. Soif the finance is not provided to agriculture sector or to industrialsector, it will be destroyed.Loan facility provided by bank works as an incentive to the producer toincrease production. Banks provide transfer of payment facility, whichis cheaper, quicker and safe. Many difficulties in the internationalpayment have been overcome and volume of transactions has beenincreased. These facilities are very much helpful for the developmentof trade and commerce.
 
University of the Punjab, Gujranwala Campus
 
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INTERNSHIP REPORT ON NATIONAL BANK OF PAKISTAN
COMMERCIAL BANKING IN PAKISTAN
It was very difficult for Pakistan to build up its own Banking systemimmediately after independence without sufficient resources. Followingthe announcement of the partition plan in June 1947 there was a hastemovement on the parts of banks to transfer their funds and accountsacross the borders. The banks having their registered offices inPakistan were transferred to India. In an effort to bring about thecollapse of the new state by the persecuting an international policy of withdrawal, the Indian bank offices closed quickly. Those banks, whichstayed, were considering the winding up of their business. By 30
th
June1948 the number of schedule banks in Pakistan declined from merescratch.Today there are more than 7000 branches of commercial banks alongwith an established network of supplementary financial institutions. Allthis development in the banking sect is the result of untiring efforts of four decades.
PHASES OF BANKING IN PAKISTAN
Broadly speaking we can divide the development of commercialbanking into four phases
PHASE-1
1947-1974 Establishment of commercial banking system
PHASE-2
1974-1979 Nationalization of banks
PHASE-3
1979-1991 Islamisation process
PHASE-4
1991-2000 Privatization process
 
University of the Punjab, Gujranwala Campus
 
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