REPORT ON HOME LOAN MANAGEMENT OF AGRICULTURE

DEVELOPMENT BANK LIMITED

                                                       

       A Project Work Report by

                              

             Aatmaram Bhusal     

T.U. Registered Number: 

Exam Roll No. :  `

Siddhartha Campur

Banganga, Kapilvastu

Submitted to

The Faculty of Management

Tribhuwan University

Kathmandu

In Partial Fulfillment of the Requirements for the Degree of

Bachelors of Business Studies (BBS)

                                           

Banganga, Kapilvastu

poush, 2077
1.1 Introduction

A commercial bank is a financial institution which collects saving from many persons and
institutions and provides credit or loan facility to different industrial and commercial business.
Commercial banking business consists of changing cash into hank deposit and bank deposit into
cash, transferring bank deposit form one person or institution to other, giving bank deposit in
exchange for cheques, bills of exchange, government securities etc.

 A home loan is an amount of money that an individual borrows from a bank or money lending
company at a certain rate of interest to be paid with the EMI every month. The property is taken
as a security by the money lending company for the Home loan The property can either be
commercial or personal in nature.When the borrower cannot pay the dues, the lender will possess
all the legal rights to recover the outstanding loan amount by sale of the property in question. A
borrower repays a home loan on a monthly basis. Usually the payment is the same amount each
month for the life of the loan. The amount of the payment is determined by several factors: the
amount of the loan, the term (time span) of the loan, and the annual percentage rate (APR; the
percentage charged by the lender each year on the amount of the loan).

1.2 Background of the study

In the context of Nepal, like as in the other countries the goldsmith and landlords where the
ancient banker. The Nepalese people were highly exploited by ‘Sahu Mahajan’ by charging
higher interest rate, compound interest rate and even by manipulating the principal amount. The
introducing of ‘Tejarath Adda’ during the tenure of the Prime Minister Ranoddip Sing (1993
B.S.) was the first step towards the institutional development of banking in Nepal. The first
commercial bank ‘Nepal Bank Limited’ was established on 30th Kartik 1994 B.S.and started to
perform proper banking activities.
Agricultural Development Bank Limited (ADBL) is an autonomous organization largely owned
by Government of nepal. The bank has been working as a premier rural credit institution since
the last three decades, contributing a more than 67 percent of institutional credit supply in the
country. Hence, rural finance is the principal operational area of ADBL. Besides, it has also been
executing Small Farmer Development Program (SFDP), the major poverty alleviation program
launched in the country. Since past few years, thebank has been coming up with various
innovative products and services. The task ofadding such other various services like any branch
banking, SMS banking, E-Banking,online remittance, ATM, LC, FOREX, Debit Card, Credit
Card is also almost completed.The bank has always been ahead in bringing new and innovative
services to satisfy itscustomers. ADBL has givenhighest priority to customer satisfaction with
completebanking solution. There are various type of Home Loan available in Agriculture
Development Bank Limited.Some of them are listed below.

Types of Home Loans:

• Home Purchase Loan: This is the loan that one takes for purchasing a home.
• Home Improvement Loan: This loan covers expenditure related to repairs of your home or even
renovation.
• Home Construction Loan: This loan comes in handy when you are building a new house.
•Land Purchase loan: Someone wishing to buy a plot of land for constructing his/her own
house can avail this loan.
• Home Extension Loan: Suppose you plan to add another room, garage, bathroom or kitchen to
your home. This is the loan that you should apply for and this also comes in handy if you are
planning to have another floor.
• Joint Home Loan: These are loans taken by two people or even more. For instance, spouses
can apply for joint home loans.
• Home Loan Balance Transfer: You can use this mechanism to switch your outstanding loan
amount to a different lender with better terms and conditions and lower interest.
• Top Up Home Loan: This kind of loan helps you borrow some more money above the
outstanding loan amount. There are attractive rates of interest offered by Bajaj Finserv in case of
top-up loans.

1.3 Statement of Problems

As we know that the main objective of any business organization e.g. Bank is profit
maximization. Deposit mobilization is the key factor to attain this objective: therefore, if the
bank fails to employ its funds suitably it is not possible to maximize profit. A bank has to make
decisions with a framework of statutory requirements of credit regulation by center bank, as well
as the national objectives that are determined in the matter of the provision of credit from time to
time. What is the trend of risk and return pattern along the studied time horizon?
  How much amount of home loan is flowed by ADML?
 Is the Agriculture Development Bank common stock suitable inorder to provide the
home loan?
 What is the nature of ROE, EPS, P/E growth ratios?
 What is the real and adjusted nature of EPS, BVPS?

1.4 Objective of the study

The main objective of the study is to fulfill the partial requirement of T.U to complete BBS
project. The objective of this fieldwork is to analyses the home loan provided by Agriculture
Development Bank. The study intends to present a brief and clear picture of home loan and its
utilization. The objective of the study includes.
 To identify the home loan process of ADML.
 To examine the amount of home loan flowed by ADML.
 To identify Agriculture Development Bank common stock suitable for investment.
 To analyses whether the deposits are being properly utilized or not.

1.5 Methodology used

The research methodology is the process of arriving to the solutions of the problems through
planned and systematic dealing with the collection analysis and interpretation of facts and
figures. The main aim of this report is to present the data and information in regarding to the
home loan evaluate and present them in analyzed way to measure potential condition of bank.
As according to this selected topics "Financial analysis could be the best mathematical tools for
the evaluation and verification of data in systematic way. For preparing this report, field work
research method has been primarily used. The following methodology are used in my project
which are listed below.

 Research Design
 Population and Sampling
 Data Collection
 Data Analysis Method
1.6 limitation of study

During the preparation of this report I have faced a lot of limitation. Some of the limitation are
listed below.

 To access such a large number of customer was difficult because of non-cooperative

attitude of responde.
 Lack of data is one of the major limitation so that only important factor has been
analyzed and discuss.
 The study will apply only statistical tool.
 Generally the data on the web site of the bank are not fully disclosed.

I have tried alot to overcome the above mention limitation as far as possible.

1.7 Time Management

For the preparation of the report the time allocated is been define below.

Activities No.of days

Topic Selection 4 days

proposal Writing 3 days

Data Collection 6 days

Data Presentation 3 days

Proof Reading 2 days

Setting and Printing 2 days

Total days 20 days