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INTERNSHIP REPORT ON National Bank of Pakistan

Bagbanpura Branch, Lahore

Professor Muhammad Aamir Mehmood Lecturer at Hailey College of Commerce, university of the Punjab Lahore

Huma Asghar BC 09 432 (Hons.) 2009-2013 Hailey College of Commerce, university of the Punjab Lahore

Dated: 25th July 2013

Prof. Aamir Mehmood Prof. Hailey College of Commerce, University of Punjab, Lahore Pakistan Being a reasonable student, I want to oblige my honorable and ambitious teacher. Whose heroic step found our hidden capabilities and mental caliber and save us from brain rust and provide us a chance to explain and elaborate this intern ship report. He has skill of sharpening a diamond after filtering it from stones. It is only possible by her matchless, amicable and devoted support. Not only, he encouraged me but he also guided me with flying colors. I am feeling proud on finding a chance to visit the organizer closely. We observed all the process and the concerned management. It endowed an opportunity to assess and visualize the management and administration of the organizer. Being I was unable to guess the very foundation of the structure. Practically view enhances the action of entire evaluation. This project made it possible that the learning process is complete only with the help of keen observation and experiment. A major theme of this internship report is awareness of organizational structure, management, administration and public dealing. Regards: Huma Asghar BC09-432 Session: 2009-13 Signature


The report which I prepared covers almost main contents of the National Bank of Pakistan. The report covered the history of the Bank, introduction, and vision, mission statement, the objectives, core values and the Bank target setting for its future promotion. This area deeply covered the almost things which are necessary to understand the above mention things. Later this report covers the organizational structure which includes the management, services departments in the branch. After that, report consist the data regarding the work done by me in different department. The report covered the overall financial highlights of Bank which includes ratio analysis of balance sheet items and income statement items. Later that in this report remaining areas such as SWOT analysis, conclusion, suggestions and recommendations and appendix which consists balance sheet, income statement, cash flow statement and statement of owner equities. All above mention name deeply clarify the explanations which are necessary to understand the report of National Bank of Pakistan.


Firstly, I am thankful to ALLAH Almighty who gives me strength to complete this task with efficiency. I dedicated to my dearly loved Parents whose supports remains always with me during my study session and courage me for achievement of my tasks. For the completion of my report I am indebted to plenty of people for their very sincere cooperation that they extended to me at various stages. Special thanks to "National Bank of Pakistan" for give opportunity to me to learn and get the real work experience.

Muhammad Irshad, Shahid Raza, Miss Faiza and all staff of bank. Excellence in supervision and devotion to inspired during my internship. Without their untiring assistance, direction, encouragement, comments, suggestions, continuous guidance, support, ideas and constructive criticism throughout this internship, this internship program could not be well.

And my beloved Teachers for their kindness, advice, knowledge, patience and time to teach me to be more confident person that I am going to use in work world.

Table of contents

Report Title Letters of Transmittal Acknowledgement Executive Summary Introduction of NBP Introduction ..10 Brief history of NBP.10 5 9

1 3

Mission Vision Goals and objectives NBP Milestones Rules & functions of NBP Regions & Divisions of NBP Committees of NBP Management Organizational chart of NBP Relationship of head office to the branch office20 Departments of NBP ..21 Finance Department Deposit Department Advances Department Remittances Department HRM Department

Branch Management ...23 Departments in Branch.24 Cash Department Govt. Department Credit Department Operations Department Account Opening Department

Clearing Department Remittance Department HRM Department Services.....25 Products of NBP .31 Assigned to me during my Internship Cash Department Account Opening Department Clearing Department Remittance Department 40 35

Financial Statement Analysis

Financial Highlights..41 Graphically Representation...44 Ratio Analysis ..49 Profitability Ratio Liquidity Ratio Debt Ratio Misc. Ratio SWOT Analysis 72 Strengths Weakness Opportunities Threats General Observations Suggestions & Recommendations References List of Illustrations List of Abbreviations

78 85


Report is about my internship that I have completed at National Bank of Pakistan, Bagbanpura Branch, Lahore from 6th August 2012 to 6th October 2012. The purpose of internship report was to Looking for a good hand on experience in the practical field with an invaluable knowledge during my experience. National Bank of Pakistan is at the forefront of international banking in Pakistan which is proven by the fact that NBP has its branches in all of the major financial capitals of the world. NBP was awarded as "Best Foreign Exchange Bank in 2008 by world's leading financial journal Global Finance and the bank with the highest return on capital in Asia and No.8 in the world by Banker Magazine in July 2003. My report comprised upon 5 sections, 1st section is about NBP history, introduction, performance, etc. the 2nd section is related to the overall role and functioning of bank (Highlights the operations and functions of bank) and 3rd section denote for Ratio analysis of NBP and 4th is about SWOT analysis, and 5th section is consist on some observations, recommendations and suggestion. During my internship I go through all the concepts practically that I studied during specialization in accounting and in last I give conclusion and recommendation that is about what I learn in the internship in this I have discussed my duties, new knowledge acquired, and problem at last how this experience will effect on my career.


The story of National Bank of Pakistan started from the beginning of economic struggle in Pakistan in the year of 1947, when non-Pakistani community of Hindus handled most of the country's economy. The involvement of this level by the Hindus in the Pakistani economy was high attitude. The situation got worst when after the division in 1947, most of the banking professionals and employees of the import and export houses, left the country and economy of the country was brought down to a standstill position. The number offices in Pakistan were 631 before the division. This number immediately fell into 193 after independence of Pakistan. These remaining offices of the bank, most of which belonged to old Imperial Bank of India, were maintained for the partial operations with the help of skeleton staff body. At the time of independence, it had been arranged between India and Pakistan that the reserve Bank of India should act as the common monetary authority for the both countries up to end of September 1948. But unfortunately this arrangement did not prove satisfaction. The main course of this malfunctioning of the whole plan was mainly because of the Indian aggression in the occupied Jammu and Kashmir, which caused some serious damage Indo-Pak relations. The normal procedure of establishing banking companies under the Companies Law was set aside and the bank was established through a promulgation of an Ordinance due to the crisis situation that had developed with regard to financing of jute trade. The bank commenced its operations from November 20, 1949 at six important jute centers in the East Pakistan and directed its resources in financing of the jute crop. The Banks Karachi and Lahore offices were subsequently opened in December 1949. State Bank of Pakistan after its formation demanded from Indian Reserve Bank the assets against the Indian currency retired from Pakistani territory. Government of India refused to hand over the assets worth about five hundred million rupees. The dispute is still unsettled and these assets still not delivered to Pakistan. Until June 1950, the bank was engaged exclusively on jute operations. Thereafter, it 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. In short National Bank of Pakistan through its wide network of branches has contributed to the industry development of the country. It has rendered active help and assigned the government in its endeavors towards financing of new sectors so to bring about an all around prosperity and development of the country.

To be the pre-eminent financial institution in Pakistan and Achieve market recognition both in the quality and delivery of service as well as the range of product offering.

NBP will aspire to the values that make NBP truly the Nations Bank, by: Institutionalizing a merit and performance culture Creating a distinctive brand identity by providing the highest standards of servi ces Adopting the best international management practices Maximizing stakeholders value Discharging our responsibility as a good corporate citizen of Pakistan and in countries where we operate.

NBP aim to be an organization that is founded on Growth through creation of sustainable relationships with our customers. Prudence to guide our business conduct. A national presence with a history of contribution to our communities. NBP shall work to Meet expectations through Market-based solutions and products. Reward entrepreneurial efforts. Create value for all stakeholders. NBP aim to be peopling who Care about relationships. Lead through the strength of our commitment and willingness to excel. Practice integrity, honesty and hard work. We believe that these are measures of true success. NBP have confidence that tomorrow we will be Leaders in our industry.

An organization maintaining the trust of stakeholders. An innovative, creative and dynamic institution responding to the changing needs of the internal and external environment

Strong emphasis has been laid upon training of branch officers to better equip them for marketing of retail banking products. Initiatives on similar lines are being launched for the SME sector. In future NBP is going to introduce modern banking services to keep pace with the competition and more important our customer needs. These are as follows: Debit cards Internet banking Call centers Mobile banking

Best Emerging Market Bank from Pakistan for the year 2005 Global Finance USA, May 2005 NBP is one of the Top 100 Banks of Asia Euro money UK, March 2005 Bank of the year 2001, 2003&2004 for Pakistan The Banker financial times Group UK. Best Foreign Exchange Bank in Pakistan global Finance USA, March 2004


NBP offers the following services to the people as a representative of STATE BANK OF PAKISTAN. Collection of cheques and bill of exchange for its customers. Paying insurance premium, rent or other obligations of the customers. Collecting interests due, dividend, pensions and other sums due to customers. Transferring of money from place to place. Acting executors, trustees for the customers. Providing safe custody and jewelry, documents or securities. Issuing of travelers cheques and letter of credit to give credit facilities for travel. Purchasing shares for the customers. Accepting bills of exchange on behalf of customers. Undertaking foreign exchange business. Furnishing trade information and tendering advice to customers. Formulating operation policy guidelines for the banks. Laying down performance criteria for banks and taking steps for ensuring their observance. Evaluating the performance of the banks in the context of operational guidelines issued to the banks. Determining the areas of coordination of the banks. Formulating schemes under section of the act. Making recommendations to the federal government for the appointment of the president and members of the executive board. Analyzing and appraising financial statement including balance sheets and profit and loss accounts of banks and appointment of auditors of the bank. Conducting such surveys, inquiries and appraisals as may be necessary for the purpose of this act.

Exercising and performing such powers and functions of the federal government under the act and such other functions as the federal government may assign to it. Establishing a central training institution for improving bank services. Coordinating the planning of the operations of nationalized commercial banks, and exercising general overall checks on the cost of their operations. Appointing lead banks and to apportion share of advance among the banks in respect of consortium loans financed by the nationalized commercial banks only, in accordance with resource availability of each bank. Watching the progress of the implementation of the rulings made in State Bank Annual Inspection Reports and the remedial and corrective measures taken by the banks with a view of removing imbalances

Field Management and Organization

There are four executives to supervise Bank matters of every provision, as they are called Provincial Chief. These provincial chief are responsible for the entire banking in their province.

The Regional chief NBP of Punjab Regional chief NBP Sindh. Regional chief NBP Baluchistan. Regional chief NBP, KPK & Azad Kashmir.

These provinces are again divided into regions. These regions are controlled and managed by Regional Heads, who are responsible for the supervision in their circles and deal with the problems in zones of their jurisdiction of branches and staff. The country has been divided into following regions, by N.B.P, to facilities its functions.


PUNJAB PROVINCE Lahore A Lahore region-B Main region-C Bahawalpur region Gujranwala region Sialkot region Faisalabad region Multan region Rawalpindi region NWFP PROVINCE Peshawar Region Abbot bad Region BALOCHISTAN PROVINCE Quetta Region Branch Lahore

SINDH PROVINCE Karachi A Karachi- B Main region Hyderabad region Sukkur Region. Branch Karachi

AZAD KASHMIR Muzafferabad A.K Region


For the better working of National Bank of Pakistan, Committees have been formed. These committees have long been working towards attaining the vision and mission of the bank. Following is the brief description of these committees. Executive Committee The committee looks after the matters regarding credit, overseas branches, and general administration. The previous provincial head quarters setup in each province of the country have since been abolished and are now redesigned as Regional Head quarters, each headed by the Regional Chief Executive. Main branch of the area is designated as Area branch and its manager is called Area manager. Area manager controls more than one branches of the area. Above the Area Branch is the Zonal Office, controlled by Zonal Chief. Zonal office reports to R.H.O, which is controlled, managed and supervised by the R.C.E. A R.C.E is required to be of SEVP or at least of EVP rank, and they are directly responsible to the President of National Bank of Pakistan. Policy Committee It is headed by President as its chairman and S.E.V.P at divisional head office. Meetings are held at the middle of every calendar month. Its function is to discuss and resolve all policy matters and to adopt new ideas, concepts and products. To review business performance at all levels. This committee discusses and decides the means and methods for the improvement in service providing and maintaining the corporate image of the bank. Loan Recovery Committee President, as its chairman, heads it and S.E.V.P (loan collection and litigation division treasury division, audit and internal control division and legal advisor, district authority (by invitation) are the members of this committee. The meeting is held in the middle of every month. Following are the core function performed by the committee:

Review of non-performing assets/ classified loans. Review of deposits /L/C/ income/ profit and other business areas/issues. Review of accounts as well as not recovery position. Review of performance of and payment to lawyer.

Balance Sheet Committee The President with S.E.V.P chairs the meeting and members include S.E.V.P international division loan collection & litigation division and external auditors (by invitation). The meeting is held quarterly in second week of April/ July/ January or as fixed by the chairman. Following are the major tasks performed by this committee: Review of assets/ liabilities position of the bank and its profit position. Review of performance under items of balance sheet and profit and loss account. To consider finalization of accounts.

Sports Committee The President, as its chairman, heads it and S.E.V.P (admin) acts as its secretary. Other members include S.E.V.P administration. President & General Secretary from each region and one more nominee from each region are or any other by invitation/nomination. The meeting is held quarterly or as decided by the chairman. Functions of this committee include: Discussing and deciding all issues regarding sporting activities in the Bank To promote sports through holding matches/tournaments To organize sports club and to develop and maintain sports grounds/complexes.


In the National Bank of Pakistans head office, sixteen (16) separate divisions deal all the necessary problems separately. Few of those divisions are as under: International Division Finance and Investment Division Economic Research and Corporate Planning Division Administration Division Human Resources Development Division Audit and Inspection Division Law Division Recovery, Litigation Division Credit Processing & Monitoring Division Corporate Credit Division. / Credit Policy Division Customer Service Division Engineering & Maintenance Division Business Promotion and Marketing Division Computer Division



Dr. Asif A Brohi (President)

Aftab Anwar Bloach (Director)

Tariq Kirmani (Director)

Haniya Shahid Naseem (Director)

Shahid Aziz Saddiqui (Director)

Zahid Hussain (Director)

Nazrat Bashir (Director)

Mohd Khalid Malik (Secretary)


1. Finance department 2. Deposit department 3. Credit department 4. Operation department 5. Human Resource (HR) department

1. Finance department Finance department of any organization controls and manage all routine financial matters. This department helps to maintain the books of account of any organization. It performs the investing and lending functions. This department not only prepares the income statements and balance sheet of any bank but also it estimates the profit and loss of any bank. It keeps record of total deposits of the bank. It keeps eye on total worth of the bank.

2. Deposit department Deposits are the lifeblood of any bank. This department promotes all of the departments in a bank. Without deposits, a bank cannot perform its banking function. This department keeps it eye on potential customers for deposits. This department motivates the branches to get a fixed target through different schemes like cash prizes and special increments. This department helps to run a banking function.

3. Credit department Credit department includes all the credit policies of the NBP. It controls all the credit policies in this bank like loans and keeps eye on securities, mortgages, pledges and so on. This department fixes the markup rate for credit.

4. Operation department Operation department concerned with the operation in a bank. This department helps in handling the routine work in a bank. Without this department, bank cannot maintain its operations. If there is any problem in working area in any branch, this department helps to correct the error and make sure that all operations are working correctly. Account opening is also handled by this department.

5. Human Resource (HR) department Human resource department is basically concerned with the employees. This department works for the benefits of the employees. This department also helps how to assign the task and jobs of the employees. It helps to the employees to do their work easily and to get more and more benefits and incentives for the employees. This department works in hiring and firing to the employees. Its work is all about the human resources/ work forces.

COMMENTS ON ORGANIZATIONAL STRUCTURE NBP is one of the oldest banks in Pakistan. It has the biggest structure in Asia. National Bank has not been changed its structure from many years so it is not so good. NBP has its great contribution towards building structure and is serving for all classes of the society. In any branch of NBP, branch manager perform all the activities in a branch. NBP has not a rigid structure. It has decentralized structure that can be adopted easily by all the employees. NBP has large its network because it is the major business partner for the Government of Pakistan because of its special emphasis to fostering Pakistans economic growth through various services like aggressive and balanced lending policies, technologically oriented products and services offered through its large networks of branches like nationally and internationally. So NBP has its good structure as compared to other banks.


Manager Operation Manager Credit Department Account Department Remittance Department Assistant Cashier Messenger Office Boy Driver Sweeper Security Guard Public Police Guard Branch Code

Muhammad Asif Muhammad Arif Muhammad Shakoor Muhammad Baig, Shahid Raza, Muhammad Shahid Muhammad Irshad Ahmad Gull Muhammad Abdullah Muhammad Faisal Muhammad Akmal Muhammad Liquat Ghulam Hussain Muhammad Tariq Bashir Ahmad Muhammad Sajjad 0540


1. Cash Department Cash department is such department that purely deals with cash. It is the most critical part of departments. Three main cashiers in cash department are cash receipts, cash payments and bill payments. One deals with cash receipts, second deals with the cash payments and the last one deal with the bill payments. It is supervised by CD in charge and head.

2. Govt. Department This department deals with all the govt. things like govt. receipts, govt. payments pension, taxes, bills, salaries etc.

3. Credit / Advances Department Credit department includes all the credit policies and control these policies. This department gives different types of loan and chare a fix markup rate for credit. Three main types of loans are: 1. Personal loans 2. Agricultural loans 3. Commercial loans

4. Operation Department: This department deals with all general banking operations. Dealing with customers, HR maintenance and account opening etc all these dealings relate to this department and is controlled by it.

5. Account Opening Department Account opening department deals with opening the account of the customers on the bank. In this department different types of account are opened like PLS saving account, Current account etc.

6. Clearing Department Clearing department deals with clearance of the payments within the branches of the same bank and with the branches of the other banks. 7. Remittance/ Bills Department Remittance department deals with the transfer of money. It transfers money from one place to another place or from one branch to another branch.

8. Establishment Department / HRM This department basically works for staff benefits like medical, traveling etc


International Banking National Bank of Pakistan is at the forefront of international banking in Pakistan which is proven by the fact that NBP has its branches in all of the major financial capitals of the world. Additionally, we have recently set up the Financial Institution Wing, which is placed under the Risk Management Group. The role of the Financial Institution Wing is. To effectively manage NBP's exposure to foreign and domestic correspondence Manage the monetary aspect of NBP's relationship with the correspondents to support trade, treasury and other key business areas, thereby contributing to the bank's profitability Generation of incremental trade-finance business and revenues

NBP offers: The lowest rates on exports and other international banking products Access to different local commercial banks in international banking.

Demand drafts NBP is safe, speedy and reliable way to transfer money, you can now purchase NBP's Demand Drafts at very reasonable rates. Any person whether an account holder of the bank or not, can purchase a Demand Draft from a bank branch.

Mail transfers Move your money safely and quickly using NBP Mail Transfer service. And we also offer the most competitive rates in the market.

Pay orders NBP provides another reason to transfer your money using our facilities. Our pay orders are a secure and easy way to move your money from one place Travelers cheques Negotiability: Pak Rupees Traveler's Cheques are a negotiable instrument Validity: There is no restriction on the period of validity Availability: At 700 branches of NBP all over the country Encashment: Limitation: Safety: At all 400 branches of NBP No limit on purchase NBP Traveler's Cheques are the safest way to carry our money

Letter of credit NBP is committed to offering its business customers the widest range of options in the area of money transfer. If you are a commercial enterprise then our Letter of Credit service is just what you are looking for. With competitive rates, security, and ease of transaction, NBP Letters of Credit are the best way to do your business transactions.

Commercial finance NBP team of professionals truly understands the needs of professionals, agriculturists, large and small business and other segments of the economy. They are the customer's best resource in making NBP's products and services work for them.

Foreign remittances To facilitate its customers in the area of home remittances, national bank of Pakistan has taken a number of measures to: Increase home remittances through banking system Meet the SBP directives/ instructions for timely and prompt delivery of remittances to the beneficiaries.

Swift system The SWIFT system (Society for Worldwide Interbank Financial Telecommunication) has been introduced for speedy services in the area of home remittances. The system has built-in features of computerized test keys, which eliminates the manual application of tests that often cause delay in the payment of home remittances. Short term investment: NBP now offers excellent rates of profit on all it's short term investment accounts. Whether you are looking to invest for 3 months or 1 year, NBP's rates of profit are extremely attractive, along with the security and service only NBP can provide. Equity investment: NBP has accelerated its activities in the stock market to improve its economic base and restore investor confidence. The bank is now regarded as the most active and dominant player in the development of the stock market. NBP is involved in the following: Investment into the capital market
Introduction of capital market accounts (under process)

National income daily account (NIDA) The scheme was launched in December 1995 to attract corporate customers. It is a current account scheme and is part of the profit and loss system of accounts in operation throughout the country. MODE OF CALCULATION: average balance during a calendar month

Trade finances others business loans

Agriculture finance NBP provides Agricultural Finance to solidify faith, commitment and pride of farmers who produce some of the best agricultural products in the World.

Agricultural Finance Services I Feed the World program, a new product, is introduced by NBP with the aim to help farmers maximize the per acre production with minimum of required input. Select farms will be made role models for other farms and farmers to follow, thus helping farmers across Pakistan to increase production.

Agricultural Credit

The agricultural financing strategy of NBP is aimed at three main objectives: Providing reliable infrastructure for agricultural customers Help farmers utilize funds efficiently to further develop and achieve better production Provide farmers an integrated package of credit with supplies of essential inputs, Technical knowledge and supervision of farming.

Agricultural Credit (Medium Term) Production and development Watercourse improvement Wells Farm power Development loans for tea plantation Fencing Solar energy Equipment for sprinklers

Farm Credit

NBP also provides the following subsidized with ranges of 3 months to 1 year on a renewal basis.

Operating loans Land improvement loans Equipment loans for purchase of tractors, farm implements or any other equipment

Livestock loans for the purchase, care, and feeding of livestock

Production Loans Production loans are meant for basic inputs of the farm and are short term in nature. Seeds, fertilizers, sprayers, etc are all covered under this scheme.

Corporate finance Working Capital and Short Term Loans NBP specializes in providing Project Finance - Export Refinance to exporters Preshipment and Post-shipment financing to exporters Running finance Cash Finance Small Finance Discounting & Bills Purchased Export Bills Purchased / Pre-shipment / Post Shipment Agricultural Production Loans

Medium term loans and Capital Expenditure Financing NBP provides financing for its clients' capital expenditure and other long-term investment needs. By sharing the risk associated with such long-term investments, NBP expedites clients' attempt to upgrade and expand their operation thereby making possible the fulfillment of our clients' vision. This type of long term financing proves the bank's belief in its client's capabilities, and its commitment to the country. Loan Structuring and Syndication National Bank's leadership in loan syndicating stems from ability to forge strong relationships not only with borrowers but also with bank investors. Because we understand our syndicate partners' asset criteria, we help borrowers meet substantial financing needs by enabling them to reach the banks most interested in lending to their particular industry, geographic location and structure through syndicated debt offerings. Our syndication capabilities are complemented by our own capital strength and by industry teams, who bring specialized knowledge to the structure of a transaction. Cash Management Services With National Bank's Cash Management Services (in process of being set up), the customer's sales collection will be channeled through vast network of NBP branched spread across the country. This will enable the customer to manage their company's total financial position right from your desktop computer. They will also be able to take advantage of our outstanding range of payment, ejection, liquidity and investment services. In fact, with NBP, you'll be provided everything, which takes to manage your cash flow more accurately.


Unprecedented Safety - Unprecedented Return Premium Aamdani Home Page

Unprecedented Safety - Unprecedented Return Premium Saver Home Page

President's Rozgar Scheme - Easy financing for self employment Karobar Home Page

Affordable, Flexible & Convenient home financing for all Saibaan Home Page

Take up to 20 Advance Salaries - Affordable Installations from 1 - 60 months Advance Salary Home Page

One Card does it all - ATM plus Debit Card in one Cash Card Home Page

Invest with Confidence - Marginal Finance Facility Investor Advantage Home Page

Meet your need for ready cash against your idle gold jewelry with no minimum limits Cash n Gold Home Page

NBP KISAN Taqat KisanTaqat Home Page

NBP's affordable agricultural program offers you a wide range of financing Kisan Dost Home Page

NBP's Internet Based Home Remittance Service Pak Remit Home Page


Cash Department Account Opening Department Clearing Department Remittance Department

Cash Department I spent two weeks in cash department under the supervision of Muhammad Shahid(Cashier) ,Shahid Raza (cashier Govt collection) and Muhammad Baig (Head of Cash Department).I was told to enter all utility bills in excel and some in Online Accounting Software dont know how to enter the bills in software but Shahid Raza sir assisted me that. My duty was to enter all utility bills correctly to make balance at the end of day with cashier. After that I was told how to prepare debit and credit vouchers, how to write amount, where stamp is needed. When my amount match with cashier I get the print of all bills like LESCO bills PTCL bills WASA bills SNG bills etc General banking In general banking department I was told to enter all inward mails TCS, Letter to branch after making entries to put them before the Operational manager and then give to every concerned employee for which they sign on register for receiving. And same for outward mails. In general banking department mostly I was assigned to type letter for manager, operational manager and all other staff. My daily duties was also check mail of Manager and gives report and make changes in reports and again sent to sender.

Advances In advances department I was told to collect documents and fill form and calculate markup.

Account Opening Department The first task assigned to me was the account opening. First of all I used asked the customer to give me his/her ID card. In ID card, I checked the Expiry Date of the ID card. If the expiry date of the card is correct and it has not been expired then I took interview of the customer so that I can know what type of account he want open PLS saving or current account and what is his/her source of income for which he/she want to open this account. After the interview, he/she asked me that he/she want open saving account. I said ok then I tell him/her that the minimum amount for opening the saving account is Rs. 500 and maximum amount you want to deposit and I also told him/her that in this account zakat will be deducted and profit will be added. He/She said ok I will deposit Rs. 500. After this, I asked the customer you will have to take some necessary documents to open this account that are as follows: Photocopy of your C.N.I.C Photocopy of Next of Kin C.N.I.C Photocopy of your mother C.N.I.C Photocopy of the your home electricity bill

After taking these documents I filled the Customer Information Folio (CIF) and in CIF I asked the customer of whom person you want to make your Next of Kin. He told me the name of next of kin, whats his relation with him/her; photocopy of his/her C.N.I.C and his mobile number. After filling this information I took a verisys of his/her C.N.I.C from Nadra from the operations manager so I can know is this correct C.N.I.C. After all these things I opened the account of customer. After this I took print of all the forms and then I took the signature card and took the signature of that person whose account I opened and I used the Branch Stamp on signature card. After this I took the sign of the designation authority means my supervisor and I also used the stamp of attestation on the photocopy of C.N.I.C after this, I filled his/ her deposit slip with that amount from

which he want to open this account that is Rs. 500 and asked him to pay the money to the cash counter and then your account will be opened. When he came back to pay the amount then I gave his all the forms and asked him that a letter of thanks will be reached your home address by post. I told him you will have to sign on letter of thanks and post it. Then I told him when the bank will receive this letter of thanks then the bank will issue you the check book. At the last, I asked the customer now you are free and you can go now. In this way, I opened the account of a person completely and I accomplished my task. Computer Department This department headed by the accountant Tariq and two other persons Mr. Junaid and Mr. Shahzad are performing the real function. The objective of this Department is to facilitate customers in payment of their cheques.The main functions performed by this department are: Checking balance. Deduction from balance on clearing cheques. Issuing bank statements. Dealing Western Union. Establishment Department NBP Bagbanpura Branch having an Establishment Department. This Department consists of only one person Haji Mouin very competent and experienced person. This department mainly deals with the branch employees. The main objective of this department is to To regulate bank business. Main functions of this department are: Keeps the record of attendance of employees. Employees salaries distribution. Employees bonuses etc.

Clearing Department: The second task assigned to me was the clearing which means the clearance of payments and cheques within city or with different cities. In clearing, I learnt about the inward clearing, outward clearing, intercity clearing and local clearing. My supervisor told me that the clearing we receive is inward clearing and that we sent to other is outward clearing. After that my supervisor gave me some intercity and local cheques and asked me to clear them. First of all I went to the clearance counter and applied the CROSSING STAMP at the front of all the cheques. After that I separated all the cheques of Lahore. And all the cheques of other cities like Islamabad, Gujranwala, and Faisalabad etc. After this I applied the CLEARING STAMP with the same date of all the cheques of Lahore and the CLEARING STAMP with the next day date of other cities cheques. After that I used the INTER CITY CLEARING stamp of all the inter city cheques. After that I used Govt. Account Credited stamp for all the govt. cheques and Payees Account Credited stamp for account holders. After that I used the Collecting. Bank Endorsement Confirmed stamp for other banks cheques which are made collection from our branch and Our Branch Endorsement Confirmed stamp for those cheques if any branch from outside said to our bank to collect money. After completing these stamps I took the registers of local clearing and intercity clearing. In the register of local clearing, I entered all the local cheques and in intercity register, I entered all the intercity cheques. After that entering the cheques in register I total all the amount of entered cheques and confirm that total with total amount of cheques. After completing this work, I made one list for local cheques and the other list for intercity cheques and entered the amount of all the cheques and made total of it. After this, I put them in an envelope and then I put stamp of the bank on it. In this way, I completed my whole work. Signed to be by senior authority like operational manager.

Remittance Department: The third task assigned to me was the remittance. In remittance department, I learnt about how the pay orders (PO), demand draft (DD) and call deposit at receipts (CDR)

are made. My supervisor asked me to make a pay order of the customer. First of all I asked the customer, are you account holder of NBP or not? He asked me I am account holder of NBP. I said ok the charges for making pay order for account holders of NBP are Rs. 100 and for non account holders are Rs. 150. He asked me to make the pay order. Then I asked the customer gave me the photocopy of your C.N.I.C. He gave me the photocopy of his C.N.I.C and told me his account number. After this I took the pay order (PO) book and filled it with his name, account number, amount in figures and words and the name of the bank. After writing these things, I applied two stamps at the front of the pay order that is branch stamp and stamp of the date. After this my supervisor signed the pay order (PO). After signed I gave the pay order (PO) to the customer. In this way, I made the complete pay order of the customer. The same procedure I used for making demand draft (DD) and call deposit at receipts (CDR). But the charges rates for making demand draft (DD) and call deposit at receipts (CDR) are also different for account holders & non account holders. During making the demand draft (DD), I used the same stamps like branch stamp and stamp of the date but the charges rates that I used for making the demand draft (DD) for account holders are Rs. Eighty and for non account holders are Rs. Hundred that I used during my work and I used the demand draft (DD) book for making DD. Similarly, the charges rates that I used for making call deposit at receipts (CDR) for account holders are Rs. 100 and for non account holders are Rs. 200 and I used the call deposits at receipts (CDR) book for making CDR. After the whole procedure I learnt how to form all the documents that are pay order (PO), (DD) demand draft and call deposit at receipts (CDR). Hence, I it was a good learning experience for myself.


Financial analysis is a process which involves reclassification and summarization of information through the establishment of ratios and trends. Financial statement analysis is the process of examining relationships among financial statement elements and making comparisons with relevant information. It is a valuable tool used by investors and creditors, financial analysts, and others in their decision-making processes related to stocks, bonds, and other financial instruments. The goal in analyzing financial statements is to assess past performance and current financial position and to make predictions about the future performance of a Bank. Investors who buy stock are primarily interested in a Bank's profitability and their prospects for earning a return on their investment by receiving dividends and/or increasing the market value of their stock holdings. Creditors and investors who buy debt securities, such as bonds, are more interested in liquidity and solvency: the organization's short-and long-run ability to pay its debts. Financial analysts, who frequently specialize in following certain industries, routinely assess the profitability, liquidity, and solvency of companies in order to make recommendations about the purchase or sale of securities, such as stocks and bonds. The analysis of financial statement refers to the examination of the statements for the purpose of acquiring additional information regarding the activities of the business. The users of the financial information often find analysis desirable for the interpretation of the firms activities. The overall objective of financial statement analysis is the examination of a firms financial position and returns in relation to risk. This must be done with a view to forecasting the firms future prospective.

Financial Highlights (A journey of 63 years)

Ten Years at a Glance (Rupees in millions)

Graphically Representation

Ratio analysis enables the analyst to compare items on a single financial statement or to examine the relationships between items on two financial statements. After calculating ratios for each year's financial data, the analyst can then examine trends for the company across years. Since ratios adjust for size, using this analytical tool facilitates intercompany as well as intercompany comparisons. Ratios are often classified using the following terms: profitability ratios (also known as operating ratios), liquidity ratios, and solvency ratios. Profitability ratios are gauges of the company's operating success for a given period of time. Liquidity ratios are measures of the short-term ability of the company to pay its debts when they come due and to meet unexpected needs for cash. Solvency ratios indicate the ability of the company to meet its long-term obligations on a continuing basis and thus to survive over a long period of time. Financial ratios allow for comparison: Between companies Between industries Between different time periods for one company Between a single company and its industry average

Profitability Ratio
1) Gross Profit Margin Formula:
Gross Profit Margin= Gross Profit/Total Revenue


2012 Gross Profit = 24,063,424 Total Revenue = 61,358,869 = 24,063,424/61,358,869*100 = 39.23 % 39.23 %

2011 Gross Profit = 26,131,683 Total Revenue = 57,769,548 = 26,131,683/57,769,548*100 = 45.23 % 45.23 %

Graphically Representation:

Gross Profit Margin

46.00% 44.00% 42.00% 40.00% 38.00% 36.00% 2011 Year 2012 Year Gross Profit Margin

This graph is showing that the gross profit margin of NBP for the year 2011 & 2012 is 45.23% & 39.23% respectively. This ratio is not constant in both years. Its showing that the gross profit margin of NBP is decreasing day by day due to increase in non mark-up interest expenses. As the gross profit margin of NBP is decreasing it is showing that the NBP is not efficient to converting its revenue into actual profits. As we know, the higher the gross profit margin the better it is. So this decreasing trend is not a good sign for NBP.

2) Net Profit Margin Formula:

Net Profit Margin= Net Profit/Total Revenue


2012 Net Profit = 16,887,057 Total Revenue = 61,358,869 = 16,887,057/61,358,869*100 = 27.52 % 27.52 %

2011 Net Profit = 17,724,846 Total Revenue = 57,769,548 = 17,724,846/57,769,548*100 = 30.68 % 30.68 %

Graphically Representation:

Net Profit Margin

31.00% 30.00% 29.00% 28.00% 27.00% 26.00% 25.00% 2011 Year 2012 Year

Net Profit Margin

This graph is showing that the net profit margin of NBP for the year 2011 & 2012 is 30.68% & 27.52% respectively. This ratio is not constant in both years. Its showing that the net profit margin of NBP is decreasing day by day due to increase in non mark-up interest expenses and taxes. As the net profit margin of NBP is decreasing it is showing that the NBP is not efficient to converting its revenue into actual profits. As we know, the higher the net profit margin the better it is. So this decreasing trend is not a good sign for NBP.

3) Spread Ratio: Formula:

Spread Ratio = Interest Eraned/Intreset Expense


2012 Interest Earned = 24,804,561 Interest Expense= 37,295,445 = 24,804,561 / 37,295,445 = 0.66 times 0.66 times

2011 Interest Earned = 19,738,325 Interest Expense = 31,637,865 = 19,738,325 / 31,637,865 = 0.62 times 0.62 times

Graphically Representation:

Spread Ratio
68.00% 66.00% 64.00% 62.00% 60.00% 2011 Year 2012 Year Spread Ratio

This graph is showing that the Spread ratio of NBP for the year 2011 & 2012 is 0.62 & 0.66 Times respectively. Its showing that the Spread Ratio of NBP is not constant and increasing day by day. This ratio is much lower in 2011 as compared to 2012. It is showing that the interest expenses in 2011 are more than 2012.

4) Return on Assets: Formula: Calculation: 2012 Net Profit = 16,887,057 Total Assets = 1,316,160,457 = 16,887,057/ 1,316,160,457*100 = 1.28 % 1.28 % Graphically Representation: 2011 Net Profit = 17,724,846 Total Assets = 1,154,966,422 = 17,724,846 / 1,154,966,422*100 = 1.53 % 1.53 %
Return on Assets = (Net Profit/Total assets)*100

Return on Assets
1.60% 1.50% 1.40% 1.30% 1.20% 1.10% 2011 Year 2012 Year Return on Assets

This graph is indicating that the Return on Asset ratio of NBP for the year 2011 & 2012 is 1.53% and 1.28% respectively. It is showing that the Return on Assets Ratio of NBP is not constant and is decreasing with the passage of time. This ratio is high in 2011 but is decreasing in 2012. Its indicating that the management of NBP is not utilizing its assets in an efficient manner in generating earnings and revenues for the NBP.

5) Return on Total Equity: Formula: Calculation: 2012 Net Profit = 16,887,057 Total Equity = 156,178,062 = 16,887,057/ 156,178,062*100 = 10.81 % 10.81 % 2011 Net Profit = 17,724,846 Total Equity= 135,954,216 = 17,724,846 / 135,954,216*100 = 13.04 % 13.04 %
Return on Total Equity = (Net Profit/Total Equity)*100

Graphically Representation:

Return on Total Equity

15.00% 10.00% 5.00% 0.00% 2011 Year 2012 Year Return on Total Equity

This graph is indicating that the Return on Total Equity ratio of NBP for the year 2011 & 2012 is 13.04% and 10.81% respectively. It is showing that the Return on Total Equity Ratio of NBP is not constant and is decreasing with little trend. This ratio is more in 2011 as compare to 2012.. This ratio measures the profitability of NBP and is showing that the NBP can generate much profit by the money invested by shareholders. In 2012, NBP is less effective in using contributions from stockholders to generate earnings due to which this ratio is low in 2012.

6) Earnings Per Share: Formula: Calculation: 2012 Net Profit = 16,887,057 No. of shares= 1,403,880 = 16,887,057/1,403,880 = 12.02 per share 12.02 per share Graphically Representation: 2011 Net Profit = 17,724,846 No. of Shares= 1,403,880 = 17,724,846 /1,403,880 = 12.62 per share 12.62 per share
Earnings Per Share = Net Profit/No. of outstanding shares

Earnings per share

13 12.5 12 11.5 2011 Year 2012 Year Earnings per share

This graph is indicating that the Earning per Share Ratio of NBP for the year 2011 & 2012 is Rs. 1.05 & 0.91 respectively. It is showing that the Earning per Share Ratio of NBP is decreasing in 2012. The EPS ratio of NBP in 2011 is more due to the increasing net income

Liquidity Ratios:
7) Advances / Deposits Ratio Formula:
Advances / Deposits Ratio= Total Advances/ Total Deposits


2012 Total Advances = 661,344,807 Total Deposits = 1,038,094,985 = 661,344,807/1,038,094,985 = 0.64 0.64

2011 Total Advances = 528,121,596 Total Deposits = 927,410,553 = 528,121,596/927,410,553 = 0.57 0.57

Graphically Representation:

Advances / Deposits Ratio

0.66 0.64 0.62 0.6 0.58 0.56 0.54 0.52 2011 Year 2012 Year

Advances / Deposits Ratio

This graph is indicating that the Advances/Deposits Ratio of NBP for the year 2011 & 2012 is 0.57 & 0.64 respectively. This high ratio is showing that the NBP is using its deposits efficiently in advancing to the borrowers.

8) Operating Cash Flow Ratio

Operation Cash Flow Ratio= Net cash generated from operating activities/ Current Liabilities

Calculation: 2012 OCF = 158,756,638 Current liabilities = 1,159,982,395 = 158,756,638/1,159,982,395 = 0.14 times 0.14 times 2011 OCF = 131,843,344 Current liabilities= 1,019,012,206 = 131,843,344/1,019,012,206 = 0.13 times 0.13 times

Graphically Representation:

Operating Cash flow Ratio

0.14 0.135 Operating Cash flow Ratio 0.13 0.125 2011 Year 2012 Year

This graph is indicating that the Operating Cash Flow Ratio of NBP for the year 2011 & 2012 is 0.13 & 0.14 times respectively. This ratio less than 1 is showing that the NBP is not generating much OCF to cover its current liabilities. So NBP need to improve liquidity by increasing the assets.

Debt Ratio
9) Debt/Asset Ratio: Formula:
Debt ratio= (Total debt/ Total assets)*100


2012 Total Debt= 1,159,982,395 Total Assets= 1,316,160,457 = 1,159,982,395/ 1,316,160,457*100 = 88 % 88 %

2011 Total Debt = 1,019,012,206 Total Assets =1,154,966,422 = 1,019,012,206/1,154,966,422*100 = 88 % 88 %

Graphically Representation:

Debt/Assets Ratio
100% 80% 60% 40% 20% 0% 2011 Year 2012 Year Debt/Assets Ratio

The graph is showing that the Debt Ratio of NBP for the yea2011 & 2012 is constant that is 88%. Its showing that the NBP is using much debt to finance its assets. This ratio is very high and is not a good sign for NBP. NBP need to decrease to its debts because high debt shows the NBP has high risk of default due to which investors will not like to invest.

10) Debt/Equity Ratio: Formula:

Debt ratio= Total Debt / Total Equity


2012 Total Debt= 1,159,982,395 Total Equity= 119,434,799 = 1,159,982,395/ 119,434,799 = 9.71 times 9.71 times

2011 Total Debt = 1,019,012,206 Total Equity = 112,671,683 = 1,019,012,206/112,671,683 = 9.04 times 9.04 times

Graphically Representation:

Debt/Equity Ratio
9.8 9.6 9.4 9.2 9 8.8 8.6 2011 Year 2012 Year Debt/Equity Ratio

The graph is showing that the Debt Ratio of NBP for the year 2011 & 2012 is 9.04 & 9.71 times respectively. This ratio is not constant in all over the years and is decreasing with the passage of time. NBP has this ratio low in the year 2011 as compared to 2012. But this ratio is approximately 9 which indicating that the NBP has 9 times more debt than its equity that is not a good sign for NBP because investors like this ratio.

11) Equity Ratio: Formula:

Equity Ratio= Total Equity/Total assets


2012 Total Equity= 119,434,799 Total Assets= 1,316,160,457 = 119,434,799/1,316,160,457 = 9.07 times 9.07 times

2011 Total Equity = 112,671,683 Total Assets =1,154,966,422 =112,671,683/1,154,966,422 = 9.76 times 9.76 times

Graphically Representation:

Equity Ratio
11.2 11 10.8 10.6 10.4 10.2 10 9.8 2011 Year 2012 Year

Equity Ratio

The graph is showing that the Equity Ratio of NBP for the year 2011 & 2012 is 9.76 & 9.07 times respectively. Its showing that the NBP is using equity to finance its assets. This ratio is very low and is not a good sign for NBP. NBP need to increase to its equity for more assets.

12) Financial Leverage: Formula:

Equity Ratio= Total Assets/Total Equity


2012 Total Assets= 1,316,160,457 Total Equity= 119,434,799 = 1,316,160,457/119,434,799 = 11.02 times 11.02 times

2011 Total Assets =1,154,966,422 Total Equity = 112,671,683 =1,154,966,422/112,671,683 = 10.25 times 10.25 times

Graphically Representation:

Financial Leverage
11.2 11 10.8 10.6 10.4 10.2 10 9.8 2011 Year 2012 Year

Financial Leverage

The graph is showing that the Financial Leverage of NBP for the year 2011 & 2012 is 10.25 & 11.02 times respectively. Its showing that the NBP is using equity to finance its assets. This ratio is very higher and is a good sign for NBP.

Miscellaneous Ratios
13) Price Earnings Ratio: Formula:
Price Earnings Ratio = Net Profit/No. of outstanding shares


2012 Net Profit = 16,887,057 Total Equity = 18,500,114 = 16,887,057/18,500,114 = 0.91 0.91

2011 Net Profit = 17,724,846 Total Equity= 16,818,285 = 17,724,846 /16,818,285 = 1.05 1.05

Graphically Representation:

Earnings per share

1.05 1 0.95 0.9 0.85 0.8 2011 Year 2012 Year Earnings per share

This graph is indicating that the Earning per Share Ratio of NBP for the year 2011 & 2012 is Rs. 1.05 & 0.91 respectively. It is showing that the Earning per Share Ratio of NBP is decreasing in 2012. The EPS ratio of NBP in 2011 is more due to the increasing net income.

14) Dividend per Share: Formula:

DPS = Dividends paid to Shareholders/ Average common shares outstandi


2012 Total Dividend = 12,596,042 No. of ord. Shares= 1,403,880 = 12,596,042/1,403,880 = 8.97 per share 8.97 per share

2011 Total Dividend = 10,077,218 No. of ord. Shares =1,403,880 = 10,077,218/1,403,880 = 7.18 per share 7.18 per share

Graphically Representation:

Dividend per share

10 8 6 4 2 0 2011 Year 2012 Year Dividend per share

This graph is indicating that the Dividend per share of NBP for the year 2011 & 2012 is Rs. 7.17 & 8.97 respectively. NBP is generating more earnings to pay its shareholders

for their common shares outstanding that is a good sign for NBP. It will attract more and more investors to invest in NBP.

15) Time Interest Earned Ratio: Formula:

Time Interest Earned Ratio = (EBIT/ total interest)


2012 EBIT = 24,063,424 Total interest= 37,295,445 = 24,063,424/ 37,295,445 = 0.65 times 0.65 times

2011 EBIT = 26,131,683 Total interest =31,637,865 = 26,131,683/31,637,865 = 0.83 times 0.83 times

Graphically Representation:

Time Interset Earned Ratio

1 0.8 0.6 0.4 0.2 0 2011 Year 2012 Year Time Interset Earned Ratio

This graph is indicating that the Time interest Earned Ratio of NBP for the year 2011 & 2012 is 0.83 & 0.65 times respectively. Its showing that the Time Interest Earned Ratio of NBP is not constant. NBP has the ability to cover its interest expenses with its EBIT but it seems poor in 2012 as compare to 2011.

16) DuPont Analysis: Formula:

DuPont returns on assets= ((net profit/revenues)*(revenues/assets))*100


2012 Net Profit = 16,887,057 Total Revenue = 61,358,869 Total Assets= 1,316,160,457 =(16,887,057/61,358,869)*( 61,358,869/1,316,160,457) = 5.90 times 5.90 times

2011 Net Profit = 17,724,846 Total Revenue = 57,769,548 Total Assets =1,154,966,422 =(17,724,846/57,769,548)*( 57,769,548/1,154,966,422) = 6.13 times 6.13 times

Graphically Representation:

DuPont Analysis
6.2 6.1 6 5.9 5.8 5.7 2011 Year 2012 Year DuPont Analysis

This graph is indicating that the DuPont Analysis of NBP for the year 2011 & 2012 is 6.13 & 5.90 times respectively. Its shows the decreasing trend related to DuPont analysis of NBP with the passage of time. This Analysis trend is high in 2011 but lesser in 2012. Its indicating that the management of NBP is not utilizing its assets in an efficient manner in generating earnings and revenues for the NBP.

SWOT Analysis
SWOT analysis is an acronym that stands for strengths, weakness, opportunities, and threats SWOT analysis is careful evaluation of an organizations internal strengths and weakness as well as its environment opportunities and threats. In SWOT analysis the best strategies accomplish an organizations mission by: 1. Exploiting an organizations opportunities and strength. 2. Neutralizing it threats. 3. Avoiding or correcting its weakness. SWOT analysis is one of the most important steps in formulating strategy using the organization mission as a context, managers assess internal strengths distinctive competencies and weakness and external opportunities and threats. The goal is to then develop good strategies and exploit opportunities and strengths neutralize threats and avoid weaknesses. STRENGTHS: Oldest institution NBP in one of the oldest bank of Pakistan and first nationalized bank Hence its customer base is strength from this plus point as customers have more confidence in the bank. The additional value services as the privilege for the bank. Alternate duties in SBP absence The NBP performs additional services for its customers as well as the other bank customer in the absence of SBP.

More deposits than other bank NBP has the relative competence in having more deposits than the other bank. This is because of the confidence the customer have in the bank. The bank being the privileged and oldest bank in banking sector of Pakistan enjoys this edge over all others, lacking it. Employee benefits The employers at NBP are offered reasonable monetary benefit. Normally two bonuses are given Eid-Ul-Fitar & Eid-Ul-Azha. This serves as an additional benefit and competency for the bank and a source of motivation for the employees. Broad network The bank has another competency i.e. it has broad-basses network of branches throughout the country also more than one branch in high productive cities. The customers are provided services at their nearest possible place to confirm customer satisfied. Strictly followed rules &regulation: The employees at NBP are strict followers of rule & regulation imposed by bank. The disciplined environment at NBP bolsters its image and also enhances the overall output of the organization. Professional competence The employees at NBP here have a good hold on their descriptions, as they are highly skilled Professionals with back ground in business administration, banking, economics etc. These professional competencies enable the employees to understand and perform the function and operation in better way.

Healthy environment The working condition in the NBP branch here is very conductive and favorable for better output. The informal environment affects the performance of the employees in a positive way. Relation between staff and other employees The bank enjoys a good plus point when it comes to the employee manager relationship the hearing as removing of discrepancies if any, between the employees, and between the manager and employees. WEAKNESSES Lack of marketing effort: The bank does not promote its corporate image, services, etc on a competitive way. Hence lacks far behind in marketing effort .A need for aggressive marketing in there in the era marketing in now becoming a part of every organization. NBP under political pressure The strong political hold of some parties and government and their dominance is affecting the bank in a negative way. They sometime have to provide loan under the pressure, which leads to uneven and adjusted feeling in the bank employees. Favoritism and nepotism The promotions and bonuses etc in the bank are often powered by seniors favoritism or depends upon their wills and decision. This adds to the negative factors, which denominate the employees thus resulting in affecting their performance negatively. Lack of financial product The bank falls far behind when the innovative and new schemes are considered. It has not been involved in the tug of war between the competitors to the accounts and

strengthens the existing customer base. This stands out to be the major incompetence and weakness of the banks. Inefficient counter services in the rush hours During the rush hours, the bank is founded out to be a total flop to handle the mob of people peaking from windows and doors. The bank has deficiency to operate in the stages of rush hours where the people find them services entangled in a situation of nowhere because they are not well served. Lack of computerized network The bank lack the strength of being powered by the network of computers, which have saved time, energy and would have lessened the mental stress, the employees have currently. This would add to the strength if it were powered by network of computers. Lack of modern equipment The bank lacks the modern Equipment that is not counting machine computers. Even if there is any equipment they lack to fall in the criteria of being rearmed as update and upgraded Uneven work distribution The workload in NBP is not evenly distributed and the workload tends to be more on some employees while others abscond away from their responsibilities, which server as a demonization factor for employees performing above average work. OPPORTUNITIES Electronic banking The world today has become a global village because of advancement in the technologies, especially in communication sector. More emphasis is now given to avail the modern technologies to better the performances. NBP can utilize the electronic

banking opportunity to ensure on line banking 24 hours a day. This would give a competitive edge over others. Micro financing Because of the need for micro financing in the market, there are lot of opportunities in this regard. Other banks have already initiated, now the time has arrived when the NBP must realize it and take on step to cater an ongoing demand. THREATS Emergence of new competitors The bank is facing threats with the emergence of new competitors especially in terms of
foreign banks.These foreign banks are equipped with heavy financial power with excellent and innovative ways of promoting and performing their services. The bank has to take

initiative in this regard or will find itself far back in competition. Political pressure by elected government The ongoing shift in power in political arena in the country effects the performance of the bank has to forward loans to politically powerful persons which create a sense of insecurity and demoralization in the customer as well as employees. Downsizing The bank is currently acting upon the policy of downsizing which threaten the environment of the bank Employees feel insecurity in doing their jobs and work, hence affecting the overall performance of employees negatively. Customers complaints There exists no regular and specific system of the removal of customer complaints. Now a day a need for total customer satisfaction is emerging and in their demanding consequences customer's complaints are ignored .

General Observations
I have divided general observation in four parts. Which are as under. This analysis is mainly based on my general observation. Problems at the branch. Function analysis. Administrative analysis. Personal managements analysis.

PROBLEMS AT THE BRANCH Customer Satisfaction In NBP customer dealing is will, but during rush hour the customer has to wait for a long time for their turn. Its quite hard for a new customer or potential customer to get the required information. Poor record management and filing system During my internship I observed that filing system of branch is not good. When certain record is needed the staff has to struggle to find it out and a lot of time is wasted. Unequal distribution of work Work is not equally distributed. On one hand some employee have to work all day without relaxing while some others have nothing to do at all. This not only creates confusion among employees but also hurting and disturbing for overall setup of the bank. And above all it results in dissatisfaction among customers as well.

Marketing visits A useful mode of contact is through personal marketing visits. Such visits are important in informing and perusing the existing and potential customers about the products and creating a sense of belongingness with them. FUNCTIONAL ANALYSIS Formal Organization Formal organization includes the activities of two or more person, which are cautiously determined groups and coordinated towards a given objective. It provides base when people are able to communicate with other, when they have common purpose and they are willing to work. In NBP, we find a formal organization. Bernard referred to an organization as a formal when the activities of two or more persons are coordinated towards a given objective. The formal organization comes into being when people are able to communicate with one another or willing to act and share a purpose. In this formal organization of NBP the activities are carried out in a more formal way. In theoretical terms it provides basis for communication with one another but in practice it is not exercised because an employee at high level cannot get straight away to manager or SVP and ask him about of his problem faced by him, because first he has to talk to his immediate superior and follow a proper channel of communication. Difference between theory and practice A vast difference exists between theory and practice and NBP has written procedure but practical work done by employees is a bit different from written procedures. Bank duty to maintain secrecy. They dont care about maintaining secrecy, especially during the rush hours. They speak loudly about the account position and while getting clearance of cheque the

person can easily get the whole information from the ledge. The deposit clerk must be careful while passing any cheque. In this regard another shortfall is in giving the information about the balance on telephone. Excessive paper work It is notified that due to the lengthy procedure of paper work the bank employee are over burdened. They are unable to give proper attention to the clients and face difficulties in getting their job done. One reason for lengthy procedure and excessive paper work in the bank is the lack of computerized technology. More accounts fewer deposits. Efficient banking is one which does not emphasize on number of accounts but on greater amount of deposits. NBP is more interested in increasing its number of account irrespective to its deposit. The main reason behind it is that bank does not provide personalize service to all the account holders and does not improve its quality and services Delegation of authority Manager has very limited authority; he has to take the approval from his management authority i-e. In case of advance he has to take the approval of general and regional manager. The other problem is created, when the manager is not present in his office, the customer have to wait for hours. This discourages both customer and officers because they have to suffer a lot ADMINISTRATIVE ANALYSIS Job analysis is not effective Only on the basis of job analysis it can be decided how a right person can be hired, trained, compensated or promoted. It is very important for an organization that nature of the job is described and job specifications are mentioned. Most of the employees are simple graduate and do not have proper background about their job. This creates

problems both for organization and for the employees. In NBP salaries are given according to the seniority and grades. People with simple or complex responsibility are getting the same salary and facilities. This creates dissatisfaction among employees. Carelessness in opening of account When customer comes to open an account, the staff does not bother to check his/her place phone number and permanent address. It is important because in case of overdraft by mistake or anything which places his account in debit it will be difficult to trace him. On the other hand he may be involved in any fraudulent activities against the bank. In this case the bank will be in awkward position. Lack of specialized training NBP does not provide adequate facility of specialized training to their staff. Training is generalized rather than specialized. As the worker finishes his training, he is inducted into a specific field without having great deal of knowledge about the field.In the branch the newly recruited employee training was not imparted, they all learned things on the job. Low Profit Rates Most of the customers shifted their account to the National Saving Center because of the low rates of saving deposit discourages the customers. Bank should increase their profit rates to attract customers. Poor job rotation. There is absence of job rotation in NBP Bagbabpura branch. A person placed in one department remains their forever. It reduces career opportunities as well boredom and in the end results in career paltering. Job rotation is very important for employee especially for those who are newly recruited. The newly recruit should be rated in all department of the banking in order to get familiar with working of different departments so that when they get a responsible position they have know how of the whole system.

Delays in Loan Advancement It has been observed that there are delays in sanctioning of cases form the head office, which results in customer dissatisfaction. Lack of appreciation Another very important thing which is ignored in the bank is appreciation if the employee on their good performance. If hard work and performance of employees is not recognized and appreciated they become dishearten which results in decline in performance. PERSONAL MANAGEMENT ANALYSIS Need for better training program Need of training is greatly emphasized all around the world. Training of the personnel is part of human resource management. It has been noticed that the training program of NBP is not adequate. Once the candidate is selected and placed on the respective job. It becomes essential to train him adequately for the task. They should learn new methods for motivating customers. The training programmed of the bank should include scientific techniques to improve the decision making and interpersonal as will individual needs of the employee both specialized to fresh as well as on job to maintain the high standards of service. Developing Managerial Leadership Leadership is a practical term of visible, clear on objective and communicating better control on financial and administrative matters. Manager is not only responsible for their own units in business, but also in people terms i.e. training, recruiting, grievance handling and taking immediate initiative in crisis situation to take major decision affection the future of the bank and banking community.

Recruitment policy Human resources are the lifeblood of the organization. If the personnel are recruited carefully they can become asset to the organization in the case of carelessness a liability on the organization. Bank is not following its recruitment policy properly due to favoritism, nepotism and political pressure. Both the top authority and staff union tries their best recruit their favorites, indulgence of political pressure add salt to the wounds. The persons selected through these channels are infantile and do not work for the betterment for the bank. Promotions Promotion in NBP is purely on the basis of seniority, so the new young person having high qualification remains behind for quite a lot of time. Top management and staff union put pressure for the promotion of their favorites, which gives a sense of deprivation to the deserving employee and their efficiency is affected. As the concept of promotion is attached with better in terms of greater responsibility, more prestige, greater skills and increased rate of salary. Thus a better and impartial policy of promotion needs to be followed. Transfer Transfer means when a person is shifted from one place to another place. It is done either that person is needed more on the other branch or for improving his skill variety. It Lack of business communication There is no proper way to give information to their customer. To avoid this minor dissatisfaction and tension in the mind of customer, and deficiency of the service, it is recommended that the bank should provide brochures etc containing information in details.

Suggestions & Recommendations

NBP is an effectively operating and profit making organization and carrying out its activities under a specified system of procedure. The main regulatory body is State Bank of Pakistan, which provides policy guidelines and ensures that the money market operates on sound professional basis. While the head office specifies the whole procedure of function and operations. This procedure has been modernized with the passage of time with a view to streamline the approach and underlying procedure for effective overhauling of its own capabilities so as to bring them at par with international practices. Here I am giving some suggestions, which in my view can add some input for efficiency and better performance of NBP as an organization in genera and City branch in particular. The recommendations are as follows: Professional training NBP staff lacks professionalism. They lack the necessary training to do the job efficiently and properly. Although staff colleges in all major cities but they are not performing well. For this purpose these staff colleges should be reorganized and their syllabus should be made in such a way to help the employee understand the ever changing global economic scenario. Banking council of Pakistan should also initiate some programs to equip the staff with much needed professional training.

Delegation of authority Employees of the bank should be given a task and authority and they should be asked for their responsibility.

Performance Appraisal The manager should strictly monitor the performance of every staff member. All of them should be awarded according to their performance and result in the shape of bonuses to motivated and incite them to work more efficiently. To Over Come Problem of Space and Furniture In the critical analysis this, problem is discussed. To overcome this problem it is suggested that a special section should be made inside the branch. Which should only handle the treasury function, salaries and pensions of federal personnel or the bank should do these functions in the evening time. Also management should purchase more furniture and arrange them in such a way which provides maximum space and convenient specially in deposit department and there should also be convenient sitting place for customers. Transfer Transfer is not properly carried out. Some of the employees are continually serving at the same post. They are simply rotated at the same branch. Therefore it is recommended that evenly rotation of every employee should take place after every three years in different branches of the bank. Changes in Policies There should not be any abrupt policies change by the upper management, as this practice hurts the customer confidences in the bank. Government should make long term policies Need of Qualified Staff Required, qualified staff should be provided to branch in order to improve the functioning of the branch. Especially a telephone operator should be appointed.

Link with the Head Quarter 100 major branches of NBP should established a direct link with the, head quarter In Karachi, through Internet or Intranet. This will make the functions and decision making of the management easier and convenient. Credit Card National bank of Pakistan should start its operation in credit card. These cards are very helpful for the ordinary customer in general and the business people in particular. To make it mores secure and to eliminate the misuse of it, the management is required to keep proper security against the card. Installing Validator and ATM Validator machine is used to count the currency notes and its installation will help to eliminate to counting errors and will save time.This branch is situated in the City, which is supported to be the hub of business activates. In this area an auto teller machine (ATM) is the need of the hour businessmen can easily check their balance in the bank and also with draw their money conveniently. Interest on Overdraft: Overdraft is a short-term credit facility provided by the bank to its trustworthy customers free of interest. Only bank commission is charge small amount of mark-up on the overdraft, which will help the bank to improve its revenue position. Clean Loans Clean loan or clean overdraft is the credit facility extended to the customers to the customers without any security. These types of small term loans should not be extended to anybody, because sometime these loans are provided to blue-eyed people of the management and they become a part of bad debts.

Cash Financing In this mode of financing the amount of credit not utilized by the borrower is remained tax-free. It is recommended that a small amount of interest should be charge on this amount as well because the bank gas kept-aside the amount for that borrower and can not advance it anywhere. Decreasing Administrative Expenses Bank should their administrative expenses. This was Rs 8 billion in the year 2000. That can be done by lying off the surplus pool of employee with golden handshakes scheme. The branches that are not much used could also be closed. Employee can also be how to control the bank expenses. That will give positive results in the future. Needs to be Flexible in credit Policy As mentioned earlier, NBP is very conservative in advances and loans policy. It reduces the investment opportunities. Also loans should be given to the small businessmen and the agriculture sector at the low markup rate. It should adopt flexible credit policy while giving credit to the agriculture sector. Technological Advancement I would like to suggest that at least all the main branches of NBP should be fully computerized in order to expedite the dealing process among bankers and their customers. Every department should be provided a computer with adequate training (especially Advances, Deposits and Foreign Exchange departments).Daily records should be entered directly into these computers, (instead entering the overall daily transactions after the banking hours). It will not only reduce transaction time, will increase accuracy but will also be efficient as well. Not only it will be economical but will also reduce the extra burden of work of the bank. It will also help in reducing the use of excessive paper work.

Staff Relationship Good relationship among staff member leads to the peak performances in any organization. I observed that the staff relationship was normal other wise but some time I noticed that there existed a little conformity among the staff members. Another syndrome from which the staff suffered was that all of them considered themselves more important than others. Some of the officers used to say that if I am absent for a day the bank would stop working. So this sort of attitude is not good because it mars bank image and juniors willingness learn and work hard and in the end will hurt the whole team. Improper Distribution of Work Proper distribution work leads to success in every organization. Proper distribution of work prevents the employee from over and under work situation. So for a smooth running of an organization proper distribution of work is the hint to be followed. During my internship I observed that there was no proper distribution of work in the bank. I saw that some of the employee worked like ants other sat idle starting here and there. So this created a lot of over work situation for while relaxation for other. Favoritism and nepotism In the City branch during my internship I saw that when some of the employees are transfer to other places, due to their relation with influential people and with top management they can cancel their transfer in few weeks, when they are unsatisfied at that place. So I suggest that in the organization there should be no favoritism, nepotism and politics and their transfer and promotion should be made on merit and according to the rules and regulations of the bank and provided favorable environment to the employee to show their performances.

Inter Departmental Transfer I watched during my internship that, there is number of employee who have worked on one seat for many a year. It can have negative effects motivation of employee who is hard working and intelligent. Take the example of advances section. In advance section if the employee is transfer after sixth month or seven month, how can he be able to show his performances and how can he be able to know the bank customer in a short period of time. Foreign currency Account For the internship the place I have selected was City branch, which is my forefather land and I know that from area many people have traveled to other country for different kind of jobs, and I have heard personal complaint about the unavailability of foreign currency account in banks. So I think it is wonderful opportunity for the bank to open foreign currency account. Marketing Policy The branch should adopt various marketing strategy and promotion strategy to promote the bank and its product.The most important in my opinion is personal marketing; it is the most effective of all when you think in term of branch level. But on the whole organization level, they should arrange the seminar within the bank and outside the bank. They should introduce various prizing schemes just like Allied Bank. Karamad Scheme, Bank Al-Falah (monthly income earning scheme) and various others. They should do more advertising through newspaper and media and through channel of personal contacts. Complaints of Customer There should be an information desk to provide the information and to receive the complaints of the customer in the bank. There is no complaint box available in the branch and not any person appointed to hear the complaints. Every person cannot go to the manager for the complaint because most of the people are hesitant. So I suggest

management to install a compliant box in the branch, and recruit a special person for that guidance of the customer when they are unable to manage some difficulties in banking matters. Analysis of the Business: Proper analysis of the business reports should be conducted before extending any type of loan. For this purpose professional training of the stuff member is required. Organizational Commitment It is suggested that employees working on daily wages basis should be given some benefits, which the other employees are getting. Their salaries must increase according to efficiency, performance and service. Managerial Leadership In the analysis, we have discussed the difficulties of the assistant in taking any initiative; therefore it is recommended that the assistants should he given special training to make them ready for the leadership. Credit Monitoring The credit department of the bank should carries out vigilant credit monitoring. They should ensure the proper payment of installments and the mark-up by the borrower. The staff members who have done all the paper work of the loan extension should perform the monitoring, as he/she will be having more information about the borrower. Extended Banking Hours The banking hours may be extended up to six, as being practiced by HBL opposite to it. Some of the business community due to law and order situation are now reluctant to keep the fund in their premises and would want to depart with it. Therefore, City Branch may extend the night banking to cater to demand of this business community. The branch could also be opened to cater the requirements of this business community

Housing and House Hold Goods loans Bank should initiate these loans because most of banks customers are middle class and they cannot afford to buy house or house hold goods at once by their own Avoiding Bad Debts Great care should be taking while extending the loan. Loans should be awarded against reasonable securities, where market value should be equal to the loan granted. Policies should be crafted in a way to ensure that no loan is extended on political pressure. SBP regulation for loan approval should be strictly followed. According to which the current ration of borrowers business must be 1:1 and the debt to equity ratio should be 60:40, means the liquidity position of business should be healthy.

References: Simons Harry and Smith J.M Intermediate Accounting 5th edition. Watson James Fundamentals of Accounting 7th edition. Sober P Parey Advance accounting 2nd edition . Tarry Franklin Principles of Management 8th edition Vause Bob The Economist Guide to analyzing companies. 3 rd edition. Annaul Report 2011 & 2012

List of Illustrations:
Organizational Hierarchy Chart Hierarchy of branch Ratio Analysis Gross Profit Ratio Net Profit Margin Spread Ratio Return on Assets Return on Total Equity Earnings Per Share Advances / Deposits Ratio Operating Cash Flow Ratio Debt/Assets Ratio Debt/Equity Ratio Equity Ratio Financial Leverage Dividend Per Share Price / Earnings Ratio Time Interest Earned Ratio DuPont Analysis

List of Abbreviations:
NBP MBA IT SBP DD PLS DM DF SME A/C TT MT FDD ACR ROA ROE ROD SWOT ATM National Bank Of Pakistan Master of Business Administration Information Technology State Bank of Pakistan Demand Draft Profit And Loss Saving Account Deutsche Mark Demand Finance Small Medium Enterprises Account Telegraphic Transfer Mail Transfer Foreign Demand Draft Annual Confidential Report Return on Assets Return on Equity Return on Deposit Strength, Weakness, Opportunities, Threats Automated Teller Machine