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1.1 Introduction
As part of the academic requirement for completing MBA (Finance). The Students are required to under go for two (2) Months of internship with an organization. The internship is to serve the purpose of acquainting the students with the practice of knowledge of the discipline of banking administration. This report is about National Bank of Pakistan Sarai Salah Branch Haripur, which was established in 1992. It gives the facility and services to the people of Sarai Salah.


Scope of Study
As an internee in National Bank of Pakistan Sarai Salah Branch Haripur the

main focus of my study research was on general banking procedures. These operations include remittances, deposits, advances, Gold Finances and Agriculture Finances. Similarly different aspects of overall of NBP are also covered in this report.


Limitation of the Study
Some thing is better than nothing. No matter how efficiently a study is

conducted, it cannot be perfect in all respects. This study was conducted in accordance with the objectives of the study. The study may not include broad explanations of acts and figures due to the nature of the study. Secondly, the limitation, which affects the study, is the restriction on mentioning every fact of the bank due to the problem of secrecy of the bank. In addition, the availability of required data was a problem as all the documents and files


are kept strictly under lock and key due to their strictly confidential nature. The third problem of short time period also makes the analysis restricted as one cannot properly understand and thus analyze all the operations of a bank just a very short time of eight weeks.


Purpose of the Study
The main purpose of study in hand is together relevant information to compile

internship report on Nation Bank of Pakistan. To observe, analyze and interpret the relevant data competently and in a useful manner. • • To work practically in an organization. To develop interpersonal communication.


Research Methodology
The report is based on my three months internship program in Nation Bank of

Pakistan. The methodology reported for collection of data is primary as well as secondary data. The biggest source of information is my personal observation while working with staff and having discussion with them. Formally arranged interviews and discussions also helped me in this regards. Primary data include Personal observation and Interviews of The Staff members. Secondary data consist of Manuals, Journals, magazines, Annual Reports and Internet.


Scheme of Study

Chapter 1 An introductory chapter that discuss the introduction of study of report, its Background, Purpose, Scope, Methodology, limitations and Scheme of the report. 2

This First chapter totally defines what is in my report. It tell the reason for what it is develop and what is methodology behind the report and limitation of report. In Scheme of study I write about the chapter in the report and define what is in it.

Chapter2 This chapter concludes brief history of banking in general from starting tell now. Then I discuss evolution of banking and Nationalization of banking in Pakistan in which I discus the importance of banking for Pakistan. In History of NBP I try to highlight those event which have import effect on NBP business and it administration. Mission statement & Vision statement tell what is their business and what they want to become. At the last topic I try to describe the objectives & functions of National Bank of Pakistan and it also give the detail of it regional branches which is define with chart. Chapter3 In this chapter the services of NBP were discussed and the department like cash department, Payment department, Govt: Receipt and payment department, Remittance department and other main department are discuss in detail.

Chapter 4 It consists of comprehensive performance of NBP through past several years. Though Ratio analysis and Horizontal and vertical analysis of Balance Sheet and Profit and Loss Statement I try to discuss the financial position of NBP. I also put the graph by which one can easily understand the result of Ratio. Chapter 5: In Fight chapter I do SWOT analysis and try to tell about Strengths the bank have and what are the weakness on which bank should focus to take advantage of Opportunities and avoid the Threats that NBP Faces in current market. 3

Finding in which different finding like problem at Branch. functional analysis.e. This chapter has been divided into three parts i.Chapter 6 It covers the critical analysis of the bank. PART IV Chapter 7 In Seventh Chapter Conclusion of my report and also give the reference from which I take tax and data which help me to complete my report. in recommendations & suggestion I try to give the solution of certain thing that I observe. 4 . distractive analysis. personal management analysis are done.

the necessity of. 2. Incidentally the word “Bankrupt” is said to have been evolved from this practice. when the Germans occupied major part of Italy. and when the business failed. the people destroyed the “Banco”. Later on.2 Evolution of Banking It has not so far been decided as to how the word “Bank” originated.3 Early Growth Banking in fact is as primitive as human society. a controlling or regulating agency or institution was naturally felt perhaps it was the Babylonians who developed banking System as it early as 2000 Bait is evident that the temples of Babylon were used as banks because of the prevalent respect and confidence in the clergy. Others authorities hold the opinion that the word “Bank” is derived from the German word “Back” which mean “joint stock fund”.CHAPTER NO. 2.2 REVIEW OF BANKING 2. King 5 .1 Banking The economic growth and success behind every developed all developing country revolve around an efficient banking system. No one would argue the fact that banking sector plays the vital role in maintaining sustained growth and development. the word back was Italianized in to “Back”. Some authors opine that their word is derived from the words “Banque” which mean a bench. for ever since man came to realize the importance of money as a medium of exchange. The explanation of their origin is attributed to the fact that the Jews in Lombardy transacted the business of money exchange on benches in the market place.

theft etc. English banking faced great crises when Charles-11 borrowed huge sums of money from the Gold Smiths and later refused to pay them back. From these profits. pledges. So Gold Smiths can be said the people who firstly started formal banking people use to deposits their valuables with the gold smiths for the purpose of safekeeping. and Nuremberg. Later on. In 1672. So Gold Smith realized that a handsome amount always remained with them. the Sumerians Babylonians. containing about 150 paragraphs which deal with nearly all aspects of loans. code inscribed on a block of diorite about 8 feet tall. Gold Smith used to charge some service charges.Hammurabi (1728 – 1686 B. In 1401 a German Public Bank was formed comprising the operations of discounting. Then when after some time these valuables were drawn from Gold smiths.). Amsterdam. People use to deposit their valuables and commodity money with Gold Smiths. So in their system the deposits were backed up with hundred present reserves with Gold Smith. So over all effect is offset. In a particular day some people withdraw their deposits and some also comes to make new deposits. drew up a code wherein he laid down standard rules of procedure for banking operations by temples and great landowners. Therefore. bronze or electrum. interest. deposit and transferring of money. In the old times Gold Smith in England started banking system. loss. By and by Gold Smith started thinking that al the deposits are not with drawn at the same day. the founder of the Babylonian empire. some more public banks were formed in Venice. Hamburg. There was of course a revolutionary idea realized by Gold smith that gave birth to modern banking system by keeping fractional reserves with them Gold Smith started lending money to the needy people and thus increasing their profits. Hittites and Assyrians standardized the values of the goods in silver. Then they decided to keep fractional reserves for daily transactions. however. Gold Smith started giving other services to the common public. guarantees. He got his. By the 16th century. natural accidents. a number of Gold Smith bankers formed themselves into a 6 . Milan. copper.C.

In July 1st. when the 7 .corporation in 1695. of Pakistan decided to establish a full-fledge central bank. The central bank of Pakistan was assigned an urgent task creating a National banking system. not covered by the gold. That was known as fiduciary issue. which could server as an agent of the state bank. the National bank of Pakistan came into being in 1949.000 at 8 % interest to William-111. coinage. currencies. the establishment of a new bank. who in return. There were only two Pakistani institutions Habib bank and Australasia bank in Pakistani. The first important task. known as the Bank of England. and thus the demand for bank advances increased shapely. When Pakistan came into existence it was decided that reserve bank of India will continue solving problems of time and demand liabilities. Governor General of Pakistan Quaid-e-Azam Muhammad Ali Jinnah inaugurated state bank of Pakistan. specially the right to issue Notes payable to bearer on demand up to the amount of their loan. of Pakistan. As a result.4 Banking in Pakistan At the time of independence the areas which now constitute Pakistan were producing food grains and agriculture raw material for sub-continent so there were no industrial zones in these areas however. was the issue of currency noted and withdrawal reserve bank of India notes with over Printing their of Govt. However. there were 487 offices of banks in these areas which were providing banking facilities. which the state bank of Pakistan had to do. allowed a number of privileges to the bank. which had been in circulation in Pakistan. exchange etc. 1948 Govt. 00. The outbreak of Korean War in 1950 provided a great boom for Pakistan’s export. Their bank lent pound sterling 12. 2. In order to attain their task it provided every help of Habib bank to expand its network of branches and also recommended to Govt.

5 Kind of Banking in Pakistan In Pakistan following types of banks are operating in the business circle like economics. and in turn. Their bank does not deal with public directly. 2.1 Central Banks Each country in the world has its own central banks. private enterprise was not coming in Pakistan consequently the state establish a regional bank by the name of EASTERN MERCANTILE BANK in east Pakistan. All these measures and the devaluation of Pakistani rupee on August 1st.5. and naturally further expansion in banking and credit facilities was mad. 1955 had a very favorable effect on market and balance of payments position in 1955-56. 2. These banks are set up on commercial bases therefore. However. This means that it neither receive cash deposit from the people. Agriculture development bank was setup to attend agriculture finance.Korean War ended in 1952. It was set up on July 1st. It was set up in 1171 in Italy. despite the intensive needs. there was a shortfall in the country’s export earnings with no appreciable change in imports earnings with any appreciable change in inputs. Their naturally caused a drain or the foreign exchange reserves. to reduce inputs and provide adequate incentives to the business and industry in the form of protective tariffs.5. Thus Pakistan now entered in to a phase of planned economic development in 1956. 1948. 2. In 1960 RURAL CREDIT FUND was setup with one Crore to provide medium and long-term credit in the rural areas.2 Commercial Banks The first commercial bank in the world is Bank of Venus. Their induced banks to provide working capital for industries. State bank is the central bank of Pakistan. The state bank of Pakistan sponsored the setting up of and industrial finance corporation. their primary 8 . affected the balance of payments position the government had. therefore.

9 . The bank can lend money to buy or construction of new house. fencing and tube wells. These banks are providing long term and short term credit facilities to the farmers for the purpose of seeds. 2.5. At present House Building Finance Corporation is doing work of Mortgage banks in housing sector.objective is to earn profit and maximize it is far as possible. Moreover purchase and development of land require funds. 2. fertilizers and agriculture tools. Industrial development bank of Pakistan is working as industrial bank. financial institutions and cooperative banks are the other components of the banking system. The public linked with agriculture and agro-based industries can get financial help from agricultural bank. In Pakistan their is need of mortgage banks. The agriculture development of Pakistan is working as a agriculture bank in Pakistan.5. They give loans to different business enterprises and thereby create credit money. The state bank of Pakistan is the central bank of Pakistan.5. commercial banks. 2. For this they received cash deposits from the people in different accounts.4 Industrial Banks The banks meets financial needs of industrial sector loans are granted to set up new companies to purchase of new machinery and construction of buildings requires long term loans at responsible rate of interest.3 Agricultural Banks The bank is responsible for development of agricultural sector in the country.5 Mortgage Banks The banks provide loans against land and building for short and long term.

6 Exchange Banks The exchange has their head offices in foreign countries. Bank of Oman and Doha Bank Ltd. 2. are some example of exchange bank in Pakistan.5. American express bank limited bank of Tokyo limited Rupali bank limited. The student Govt. They deal in foreign exchange due to foreign trade. Post offices and national saving centers are example of such banks in Pakistan. 10 . 2.2. After this commercial phase. The exporter receives foreign currency. The people save money for future needs. The Punjab provincial cooperative is the example of cooperative bank. The members may be farmers or small producers.5.7 Cooperative Banks These banks can provide banking facilities to member for meeting their financial requirement. controlled our economy. The importer makes payments in foreign currency. East Pakistan was spared from massive migration but its economy was also. The number of bank offices fell from 631 to 195 after partition. being dependent on Calcutta. After partition over 7 million people came to West Pakistan & about 5 million went out. in 1950 started the industrial phase – Jute and cotton industries were started during 1950-55. badly hurt.5. employees and house hold women can open such account. mostly Hindus.8 Saving Banks The banks receive idle money from people having low income.6 History of National Bank of Pakistan When we won political independence. The saving offers responsible rate of profit on saving account. 2. Non. Most bankers & business experts left Pakistan and the economic life was brought to a standstill: mostly branches of Imperial bank of India were only in partial operation with little staff.Pakistanis.

In August 1947. NBP stood behind jute trade. India had done it arbitrarily without consulting us. we were given a first installment of Rs. India also froze our trade balance surplus. These are as under. Two ordinances were. Speedy it was such that 6 branches came into being at once and the doubts on our ability to handle this situation were dispelled forever. • • Jute Board Establishment Ordinance & NBP Ordinance dated 08-11-1949. In response. 1948. 200 million (20 crore) as our share. on July 1. which was the last public appearance of the Quaid-e-Azam. India followed suit but we did not. issued. India also withdraws the Marwari merchants who were employed annually for movement of jute crop by financing it. as the jute Board and 11 . the two central banks were to announce the new par value of both currencies but India denied a day earlier. foreign banks and foreign merchants stood aside and an agrarian unrest was threatening. therefore. NBP was established on 20-11-1949 to provide finance to suitable parties. India said we had contravened the agreement of keeping both currencies at par.K. stood behind SBP. which is still an unsettled dispute. There was being no jute industry. But this arrangement did not prove well. 3 months ahead of schedule. 550 million (55 crore) but it was not paid when ask for.It was decided that Reserve of India would act as the common monetary authority of both countries up to September 1948. but this 50crore India disputed and virtually refused to settle this dispute until now. Reserve Bank of India refused to make even an advance for ways and means. In October 1947 there was fighting in Kashmir. There was a controversy on establishment of our central band because we had no experience or expertise but it was resolved and SBP was created. devalued its currency. On October 1949. Despite that India had to pay our 50 crore. leaving a balance of Rs.55 crore if we did not give up all interest in Kashmir. In 1949 (September) U. Now. SBP claimed its share of Assets of Reserve Bank of India against the Indian currency retired from Pakistan. when India refused to give us the amount of Rs. (the remaining 5 crore still remains unpaid). SBP stood behind NBP and the Govt. prices fell sharply. which we refused. We said we had not done that.

Ghulam Farooq was chairman jute Board & Mr. NBP had branches in London and Calcutta. At separation of East Pakistan NBP lost its branches there. After that Mr.D. Tanganyika. As part of the concomitant consolidation of the banking sector. In 1962 when Mr. In 1965. Mumtaz Hassan became M. 1950. NBP merged with Eastern Mercantile Bank and with Eastern Bank Corporation. Mr. NBP remained exclusively in jute operations. Mumtaz Hassan negotiated this arrangement as acting Governor of SBP. During 1994. In 1967 The Tanzanian government nationalized the Dar-Es-Salaam branch. NBP acquired Bank of Bahawalpur (est.1966 its 600th branch was opened raising the deposits to 2.D. people’s credit scheme was started to finance small business. the number of branches increased from 6 to 239 & deposits from Rs. Mohair became its first M. Turkmenistan commenced operations. NBP opened an offshore brain Cairo. In 1952. While in 1964. M. & Mr.963. In 1964. 1962 NBP established a branch in Dar-es-Salaam. State Bank of Pakistan and 12 . Kazakhstan. A branch in of NBP Baghdad. In 2001. the government of Pakistan nationalized NBP. Iraqi government nationalized Baghdad Branch of NBP.In Des. Mr. NBP replaced Imperial Bank of India. The Indian government seized the Calcutta branch on the outbreak of hostilities between India and Pakistan. Mumtaz Hassan was chairman NBP. and staff to 14. In 1977. NBP established a branch in Jeddah. 1947). In 2000. profit from Rs. In 1997. 1991). In 1950.31bn. the foreign merchants and bankers also rushed in to get their share in the business and consequently NBP had to lay out much less finance than it could. 5 crore to 106 crore. NBP's branch in Ashgabat.A. Until June.NBP were in the field. In 1971. Saudi Arabia. Iraq was established in 1957. 3 lack to 21 million & the staff increased from 380 to 7091. NBP opened a representative office in Almaty. one in Karachi and one at Chittagong. Zahid Hussain. there after other commodities were also taken-up. By 1955. NBP acquired Bank of China's two branches. During 1974. Governor SBP assumed additional charge also as a chairman NBP’s Board of Directors. NBP amalgamated Mehran Bank (est.

The various departments include: 13 . with seven branches at Main Branch.000 employees world wide. of which NBP would own 45% and United Bank 55%. NBP also have a Joint Venture with UBL at U.K.7 Current Position of NBP National Bank of Pakistan maintains its position as Pakistan's premier bank determined to set higher standards of achievements. Glasgow Branch. Sheffield Branch. The ownership structure of the UNB remained as before. Also that year. NBP also received permission to open a branch in Afghanistan. It is the major business partner for the Government of Pakistan with special emphasis on fostering Pakistan's economic growth through aggressive and balanced lending policies. Manchester Branch. Bradford Branch. technologically oriented products and services offered through its large network locally. Beijing (China) and Chicago (USA).Bank of England agree to allow only 2 Pakistani banks to operate in the UK. with the name of Pakistan International Bank (UK) Ltd. Baku (Azerbaijan). London. one Subsidiary at Almaty (Kazakhstan) and four Representative Offices at Tashkent (Uzbekistan). During 2002.. 15 overseas branches. Pakistan International Bank renamed itself United National Bank Limited (UNB). In 2005.. NBP maintains its position as Pakistan’s Premier Bank with a network of over 1100 branches locally. NBP closed its branch in New York. NBP closed its offshore branch in Cairo. The only change to the shareholding structure is that UBL had recently been privatized in Pakistan and was now owned 49% by the Government of Pakistan and 51% by a joint foreign consortium of Abu Dhabi. Birmingham Branch and Knightsbridge Branch (London). 2. NBP and United Bank agreed to merge their operations to form Pakistan International Bank. In 2003. internationally and representative offices. The Bank currently has an employee has of over 15.

8 Services of NBP • • • • • • • • • • • • • International banking Demand drafts Mail transfers Pay order Traveler's cheques Letter of credit Commercial finance Foreign remittances Swift system Short term investments Equity investments N.d.a Agricultural finance • Corporate finance 2.i. 2.Consumer Banking – Corporate Finance – Investment Banking – Agricultural Banking – Transactional Banking – Operations – Software Development and Automation – Financial Control – Treasury – Internal Audit – Risk Management & Credit – Economic & Business research – Training & Development – Strategic Planning – Human Resources.9 NBP Retail Products • • • • • • Premium aamdani premium saver karobar saibaan Advance salary cash card 14 .

10 Competitors of NBP The Competitors of NBP are the other commercial Banks providing same services such as • • • • • • • • HBL UBL ABL MCB Bank Al-Falah Citi Bank RBS etc 15 .• • • • • • • • Investor Advantage Cash N Gold Kisan Taqat Kisan Dost Aasan Banking NBP Helpline Internet based home remittance service Personal accident insurance 2.

Figure: 2.11 Mission Statement & Vision Statement Mission Statement “NBP will aspire to the values that make NBP truly the Nation’s Bank. by: • Institutionalizing a merit and performance culture • the Creating highest a distinctive of brand identity by providing standards services. international best practices and social responsibility”.” Vision Statement “To be recognized as a leader and a brand synonymous with trust. highest standards of service quality.11(a) 16 .11(a) • Discharging our responsibility as a good corporate citizen of Pakistan and in countries where we operate. Figure: 2. Maximizing stakeholders value.2. • • Adopting the best international management practices.

We aim to be an organization that is founded on… Growth through creation of sustainable relationships with our customers. It is the major business partner for the Government of Pakistan with special emphasis Pakistan's on fostering growth economic through aggressive and balanced lending policies. Prudence to guide our business conduct. We shall work to… Meet expectations through Marketbased solutions and and representative offices. Figure: 2.2.12 (a) Source: http://www.12(b) 17 . technologically oriented products and services offered through its large network of branches locally internationally Figure: 2. A national presence with a history of contribution to our communities.scribd.12 Objective of National Bank of Pakistan National Bank of Pakistan maintains its position as Pakistan's premier bank determined to set higher standards of achievements.

We aim to be people who… • • • Care about relationships. We have confidence that tomorrow we will be… d • • • Leaders in our industry. creative and dynamic institution responding to the changing needs of the internal and external environment. Create value for all stakeholders. An innovative. “After all.scribd. An organization maintaining the trust of stakeholders. we are The Nation’s Bank.Source: http://www. honesty and hard work. Practice integrity. We believe that these are measures of true success.” 18 . Lead through the strength of our commitment and willingness to • • Reward entrepreneurial efforts.

2.13 19 .13 Detail of Regional Offices Across The Country Figure: 2.


C. Main Shara-e-Faisal Karachi. Mumtaz Tariq Kirmani Haniya Shahid Naseem Nazrat Bashir Audit Committee Chairman Ibrar A. Chartered Accountants Legal Advisors Mandviwala & Zafar Advocates & Legal Consultants Registered & Head Office NBP building I.I Chaundrigar 21 . Karachi.M. CDC House. Pakistan Website www.H. of Pakistan.2. Yousu Adil Saleem & Co. Mumtaz Mian kausar Hameed Tariq kirmani Auditors Anjum Asin Shahid Rahman & Co. Chartered Accountants M. 99-B. S.S.nbp. Pakistan Registrar & Share Registration Office Central Depository Co.15 Corporate Information Board of Directors Chairman & President Syed Ali Raza Muhammad Ayub Khan Tarin Mian Kausar Hameed Ibrar A.

08.CHAPTER NO. It contains almost all the departments which are mentioned below.1 Cash Department 22 .2010 at this branch.2 3. I have started my internship on 23.7 Cash Department Deposit Department Advances Department Bills and Remittance Department Establishment Department Management Department Govt. Most of the operations are performed in this branch.6 3.1 3. Department of National Bank of Pakistan The main departments of NBP are describing below: 3. I have worked in the different departments of the branch especially the account opening account and advances sections. The branch is situated near about in the middle of the city.5 3.3 3. receipt & payment Department Now we see the functions of each department working at National Bank of Pakistan. 3.4 3.3 BRIEF INTRODUCTION OF BRANCH I have done my internship in the National Bank of Pakistan Sarai Salah branch Haripur.

after getting the token from deposit section he goes to the cashier. cashier checks his token and cheque which is referred to him from deposit section. The closing balance of cash is also included in the cashbook. After stamping the slip the cashier returns the pay in slip to the customer. stamps it and record in his book.1. 23 . The cashier makes to him required payment and receives the token from the customer. Also the bank’s cash record remains with this department. After recording all the cheques in his book he returned the cheques in to the deposit section. Then customer goes to the another bank officer. It is maintained with the help of various types of vouchers and daybooks. sort outs the notes. 3. 3. puts a signature.2 Cash Payment Book When some client comes to the branch to withdraw some amount from the account. The client’s com with pay in slips and the cashier the amount according to the pay in slip.3 Cash Book The sole purpose of the cashbook is to record the total transactions done in each type of account daily. Book Maintain The following are the common books.1.1. There are two types of books used in this department.1 Cash Receipt Book In which the cashier records the entry when some one comes to deposit some amount. 2.The cash department is that through which all the receipts and payments of bank are made. which are maintained in any branch of NBP. he again record this voucher into his cash scroll and returns one part of the pay in slip to the customer and keeps the other part for the record.

Suspense vouchers. Suspense register Charges register    3. Cash finance day books. Payment order vouchers. Current daybooks. Running finance day books.2. With the help of these vouchers various types of registers are maintained to record daily transactions done in various accounts. Foreign exchange day books. These registers are:Daily transaction report of PLS/ Current account.2.2 General Ledger In this ledger the posting is done from the cashbook. In this ledger debit or credit balance of each balance of each type of account is posted from the cash book. Demand finance day books. PLS daybooks. 2. Call deposit vouchers. 24 . Term deposit vouchers. With the help of this ledger any discrepancy in balance of accounts can be easily found out.3 General Abstract Ledger It is like trial balance.These vouchers and day books of different heads are as follows:           Charges vouchers.

3. The issuing bank informs the advising bank that credit has been issued. The advising bank will give one copy to the exporter. All terms and conditions of sale contract are recorded on it. The following steps are involved for opening a letter of credit. the banker will ask the importer to file an application on the printed form. This amount is called Margin.2. The issuing bank on the receipt of shipping documents. The seller sends the goods to the Bayer and provides the shipping documents to the advising banker. effect payments to the seller. the issuing bank keeps one copy and other two copies are sent to the advising bank. Three copies are prepared. he settle with the seller about the prices quantity and quality of goods and mode of making the payments. The bank checks the documents and then sends to the issuing. 25 . This amount is deducted from the total payment made by the importer. The banker will ask the applicant to provide import licensee and Performa invoice. The importer contracts the exporter for purchase of goods. The terms and conditions of sales are also stated on it. After checking these documents. A printed application form usually called Letter of Credit is filled up by the banker and signed by the importer.4 Letter of Credit A letter of credit is a means of making payments for the imports of goods. Then the importer informs his banker to open a letter of credit. It is issued by the Bayer’s Bank in favor of the seller. The State Bank of Pakistan decides the percentage of amount to be paid to the issuing by the importer. The advising bank informs the seller that credit has been issued. The shipping documents are released to the Bayer upon payments of the amount due. The Bayer sends the transport documents to the carrier who will then proceed to deliver the goods.

National Bank of Pakistan provides the facility of letter of credit to its customers. The client authorized the bank to debit all the expense occurred for this deal from his account at any time. • • • • • Application Form Appendix Undertaking Performa invoice Import registration/import license After filling these documents and submitting to bank all the documents are checked and signatures by the bank. In this case the seller is at risk. up to the moment of payment. Party comes to bank and bank following from for completion. which depends upon the credibility of client as well as nature of product. In this case the seller is not at risk. Deposit Department 26 . Because bank is required to meet the liabilities. Bank evaluates the credibility and transaction of applicant. It can be amended or cancelled only with the agreement of the parties. If the balance of importers accounts fulfills the requirements then managers will open L/C.There are two main kinds of letter credit: • • Revocable Irrevocable It can be amended or cancelled at any time without prior notice to the seller. The margin is to be debited from import account. An approval form is attached to these documents. Bank fixes some margin. The amount which is mentioned in L/C not found in applicant’s account. bank will not open L/C.

All types of cash transactions are deled under this section. Now we see the types of accounts. 27 . which are opened in this section.

S. The minimum balance required to an account to be opened is Rs. After every six months a rate of profit is announced by the bank and after calculating the incident charges applied.2 Profit & Loss Sharing Saving Account In these P.L. The bank also does not tale any service charges up to the minimum balance of account from the depositors.(Monthly Income Scheme)     A brief introduction of these accounts is given below.4 Types of Account Depositors can open the following types of accounts with the National Bank of Pakistan:Current account P. 3. M. if an account holder maintains 3000/. 5000/-.S. Unlike time deposits there is no restriction of withdrawals. Also on 1 st day of 28 .I. 500/-. it is credit to the depositor account.4.L.3.minimum balance throughout the year then his account is eligible for profit. accounts the bank gives no fixed rate of profit. 3.4.L. The bank neither pays any kind of interest nor deducts the Zakat from the deposits of this account. If balances in account reduce from the minimum balance of 5000 then the bank charges Rs. The minimum deposit to open this account is Rs.S. 50/. P. Businessman normally opens this kind of account. saving account.1 Current Account As the name signifies the depositor can draw or demand amount at any time by presenting the cheque in the bank. Now a day. Term Deposit Account. In developed and developing countries a very significant amount of money is kept under current account. These types of deposits are designed to encourage the saving habits of the people.S.

Then his 29 . Mostly retired persons are like to open this type of account.L.5 %.5 Account Opening Procedure The customer can open an account with the National Bank of Pakistan in the following categories:Individually Account Jointly Account Sole proprietorship Account Partnership Firm Corporation Account      3. Profit is announced after every six months but it is credit to the customer’s accounts on every month. 3.4.R. There is higher rate of profit on long term P.RAMADAN’s Zakat is deducted at the rate of 2.S. T. Profit is announced after six months and then credit to the respective accounts. Restriction on withdrawal of heavy balances is now abolished. 10000/-. 3.D.1 Individual Account A person can open an account in National Bank of Pakistan in Pak-rupee.L. The minimum balance required to open this type of account is Rs.3 P. 3.10000/-.4 Monthly Income Scheme For this scheme the required minimum balance is Rs. This period varies from 7 days minimum to maximum 5 years. The profit rate is also changes with the short period to long period.5. Customer con withdraw their amount at no limit. Term Deposit In this type of account the amount is deposited for a specified period of time. First of all he/she has to fill the account opening form provided by the bank.S.4.

P.5. A copy of his identity card is must attached with his account opening form. If the account holder is illiterate then he/she provides his/her three recent photographs to the branch.introduction is done before the branch manager. He or she also states the made of operation which is clearly written in their account opening form.2 Joint Account A person can open an account in N. 3. in Pak-rupee. In that opening form he provides complete information about the account holders. • • • Current municipal license Commercial registration certificate Copy of identity card 30 . And for any kind of transaction they must dually signed the documents while the either or Survivor mode any one of them can sign the cheque and withdraw his money. 3.3 Sole Proprietorship The person who is the sole owner of a business can open an account with National Bank of Pakistan after providing the following documents to the bank officer. Then the introduction of the person is done. The account holder can get the statements of accounts from the bank at his will at any time without any charges. In joint account there is two modes of operation first are “Jointly” and second is “E or S”. A copy of their identity card is must attached with his account opening form. An existing account holder of the bank or an officer of the bank who know him very well can do this introduction. In jointly mode both the persons must sign the cheque. In order to stop the payment from his account it is necessary to give the instructions in black and white.B. If any one or both of them are illiterate then he or they give the photographs to the bank.5. An account opening form is given form that branch where he wants to open his account.

5 Name of firm Name of parties Identity card of partners Registration certificate of the firm Limited Company/Corporation In order to open the account of a company the following documents are required by the bank so that the bank could take action in case of any fraud or discrepancy. The branch manager studies all documents of the business. 3. • • • • • Memorandum of Association Memorandum of Article Most recent balance sheet and profit and loss statement Resolution of board of directors about the person who is Any other documents authorized to sign the cheques. • • • • 3.5. If he is satisfied then the account of the party is opened with the bank. For this purpose a form is provided to the account holder in which they provide the following information to the concerned branch and the person who can draw the amount from the bank is also nominated.6 Issuance of Cheque Book 31 . But for this purpose they have to provide the certain type of information to the bank.4 Partnership Firm The partnership firms can also open an account with the bank. Normally these types of accounts maintained under Current account system.In some special cases when the officer of branch is doubtful about the authenticity f the documents he can get additional documents for proper verification.5. 3.

3. cheques. • • Green voucher which is used for Cash Receipts Pink voucher.Now-a-day the price of cheque book issue by the NBP are 30. payment orders etc.e. 3.P. 3.7 Depositing of the Amount Account holder can deposit the amount in cash or draft etc.8. 75 Size of cheque book is varies. Pay Cash and Signature Verified. two types of vouchers are used for this purpose.8 Encashment of Cheques 3. • • • • Issuance date Name of account holder Account number Type of account After authentication by the authorized officer on the cheque book register. in his account through credit voucher. In N. It contains 10 leaves to 100 leaves.2 Verification of Signature After affixing the two stamps i. which is used for all Non Cash Receipts like drafts.B. the cheque book is handed over to the account holder. A cheque is sent to the accountant for the verification of signature from signature specimen 32 .8.1 Issuance of Token After scrutinizing the apparent tenure of cheque a token is issued to the account holder. The assistant writes the following information on the title page of the cheque book and cheque book issuance register.

3.3 Payment of Cash Cashier pays the amount to the token holder after getting back the token from customer.5 Exemption From Zakat The accounts of foreigners (including Muslims of other nations) and Pakistani non-Muslims are exempted from the compulsory deduction of Zakat. The accounts of followers of Fiqah-I-Jafria are also exempted from the deduction of Zakat after the submission of affidavit on a legal stamp paper.8.e.5% annually on the outstanding balance of account on the first day of every valuation date i.4 Deduction of Zakat From the PLS Saving account Zakat is deducted at the rate of 2. It is not a good indication for the business of the bank. 3.8. 3.8. Minimum balance of the deduction of Zakat is fixed by the Central Zakat authority (CZA) before the valuation date. first day of Ramazan. 3.9 Closing of Account There are many reasons for closing of an account. it is subjected to the withholding tax at the fix rate of 10% annually. 3.6 With Holding Tax Whenever a profit is paid on any deposit.8. Some of the more common reasons are as follows: • • Account holder’s own request Death of the account holder 33 .card. After authentication of signature and posting in his account the cheque is sent to the cash department for the payment.

The need for remittance is commonly felt in commercial life particularly and in everyday life generally. National Bank of Pakistan deals with the following type of remittances:• Demand Draft (DD) • Mail Transfer (MT) • Telegraphic Transfer (TT) • Pay Order Now we discuss all these in detail:- 3. But bank before closing the account first sends a letter to the account holder that his account will be closed.1 Demand Draft (DD) Demand draft is a written order given by the one branch of a bank on behalf of customer to another branch of the same bank to a certain amount to the certain person. Remittance Department Remittance is a major function of the bank. It is the transfer of money from one place to another place. 34 . In first case account holder requests in black and white to the branch manager to close his account. it is marked of the accounts holder’s number that the account has been closed. An account is closed at the request of account holder or as a result of improper conduct of the accept holder or because of nil balance of the account.10. Procedure for prepare demand draft.• • Bankruptcy of the account holder Closing of account due to bad conduct of account holder etc. While in seconds’ case the branch manager is authorized to close the account. So after fulfilling the legal requirements. By proving this service to the customers the National Bank earns a lot of income in the form of service charges.

withholding The sender deposits the total amount of the two vouchers i. amount and receiver’s name. assistant who records the sender’s name.•     • • • • A draft voucher is filled which contains the following information Name of the parties involved Date Amount to be sent Account number (if DD is crossed) A credit voucher is filled in order to get the excise duty. After writing all the information in the DD register he gives it to the officer along with the DD for authentication. • Purchaser or Sender The purchaser is the person who sends the money to a particular person payable at a certain branch. • After authentication the DD is handed over to the sender and bank sends the advice to the concerned branch. • Issuing or Drawing Branch The branch from where the demand draft is issued to another branch of the same bank. 35 . • Drawee Branch Branch in which the draft has drawn and called upon to pay the amount.e. and credit vouchers. Parties Involved In the Demand Draft The following parties are involved in demand draft. So when the party presents the DD in the concerned branch its payment could be made. department and the account records the amount paid in his cash scroll. the debit Then the cashier sends the cash receipt voucher to the accounts Accountant gives the DD leaf along with the DD voucher to his tax and exchange commission.

voucher.2 Mail Transfer (MT) It is the transfer of money from one branch to another branch of the same bank through mail service. department. 3. In mail transfer there is no need of advice as the amount is directly credited to the receiver’s account. • He takes two signature of the sender on the counterfoil of the MT and counter foil is handed over to the sender.• Payee The person who is entitled to receive the amount after presenting the demand draft in the drawee branch. 3. at the end the MT along with the fan fold is sent to the concerned branch through mail. name. Then he gives the MT leaf and MT register to the officer for authentication.3 Graphic Transfer (TT) 36 .10. He also writes the same information in the MT register. • • • • • A credit voucher is filled in order to deduct exchange. postage charges The sender deposits the total amount of the two vouchers in the cash The cashier gives the vouchers to the accountant after affixing received Then the accountant writes the amount paid in the cash scroll and gives MT leaf is filled according to the information provided in credit and withholding tax according to the amount of the mail transfer. stamp and writing the amount in red ink.10. Procedure • First a voucher is filled in which the sender writes the amount to be sent. the MT to his assistant. account number of the receiving person with the branch name and date.

in this case the sender request the manager of the branch to issue TT. This method is used when the sender desires to send urgently.This is the most urgent method of remitting the money from one place to another place. 37 .

Procedure The procedure of a pay order varies with the nature of the purpose. which is allotted. After finishing the work the contractor submits the bill of work on his stamp pad. The purpose may be the repairs of the branch or renovation of the branch. 38 . Then the bank issues a pay order.Procedure For sending the TT the manager applies a test. First the person deposit the TT amount along with the charges through the credit voucher then his TT sent to the relevant branch. drawn upon and payable by itself to pay a specified sum of money to the person. If the sender wants to convey the same message through telephone then he has to pay the charges of telephone along with the TT charges.4 Payment Order (PO) A pay order is a written order issued by the bank no its own branch. 3. After making all the conformation the concerned branch makes the payment to the receiver. It is usually not issued in favor of the parties of other cities. Usually the pay order is issued for the local transfer of money from one person to another or from the person to any other Department. to him as the bank branch code. But if the work is small then the branch manager has discretionary power to select the party whose rate is lowest.13. In the test the manager uses a coding technique. Then the advertisement of the work is given in the newspaper in order to invite the contractors. If the work is of huge amount then first the manager writes a letter to the Zonal Chief in order to get sanction of the work. against the pay order the contactor gets the amount from the issuing branch. It is used for different purposes. He writes his own code number. The purpose of a pay order is to transfer the fund from one place to another.

11. 8 per bill from each type of bill.11 Govt.T. In order to get the pension. (Mail Transfer). first the pensioner submits his pension voucher with his 39 .3. Receipt & Payment Department Govt. • • • • Electricity Bills BLT Bills Telephone Bills Sui Gas Bills Procedure The cashier in cash section receives utility bills.2 Disbursement of Pension National bank is fully authorized to disburse the pension to the Govt. The bank takes the collection commission of Rs.1 Utility Bills National Bank accepts the following types of utility bills. Then representative of the concerned department collects the amount in the shape of M. and Army retired personnel.11. Now we see one by one: 3. The cashier posts the amount of bill in respective scroll and at the end all the amount of collected bills is transferred to the respective account. Procedure For the distribution of pension the branch maintains the pension register. Receipt & payment includes different types of work. 3.

3.12 Advance Section Advances are investments of bank to earn profit. For this purpose bank hire the services of different courier services to sent the documents from one place to another.11. The Manager is responsible to achieve these targets in the given period. 3. Head Office gives loan targets to each branch that must be achieved for its survival. Assistant of this department sort out the receiving mail and then sent to the different sections.1 Short Term Finances 40 .pension book that voucher sent to the cash department for the payment to the pensioner after posting into his account. now it is the responsibility of the courier service company. After handing over to the courier service. which is used to maintain the proper records. In case of misplacement they have to pay for the damages. Before the handing over the mail to the courier service clerk. After restructuring of National Bank of Pakistan.3 Dispatches Section This section deals with posting of every mail into the dispatches register. the dispatch section assistant notes the document in a register and issues a number. 3.13 Types of Loans/Finances There are three major types of loans that are offered by NBP mostly at the rate of 11%. they are as follows.13. • • • Short Term Finances Medium Term Finances Long Term Finances 3.

Govt. for purchasing a motorcycle.Short-term finances are sanctioned for increasing Working Capital & Production. certificates & 41 . security bonds. It is issued for establishment & extension of industry. Short Term finance includes the following types: Cash Finance The bank gives their loan to the customer & businessman against certain specified immovable property. house building. There is no markup on their loan except on car & computer buying @ 4%. Gold Finance It is sanctioned for the period of 11 months by pledging gold ornaments. Demand finance is further divided into three types: Staff Finance Their finance is given to the employees of National Bank for improving their living standard e. Demand Finance Their loan is given against movable property (called Secure Finance) or may be given against personal guarantee (called Clean Finance). Agricultural (Seasonal Finance) It is given for supporting seasonal crops like ‘Rabi’ & ‘Kharif’.g. It is sanctioned for six month only at high markup rate. These are given for the period of one year to 3 years maximum. Running Finance Their finance is only a secured finance which is sanctioned against movable security that is easily convertible into cash e.g. car. computer etc.

or semi govt. personal habits.g. Non-Fund Base loans are those which given other than cash e. The willingness can be judged by the banker to see her family background. It is newly commenced credit scheme by NBP. stability of employment.g. Promissory Note etc. The only condition for their type of credit is that the salary must be directly credited into the bank. importance of values to her etc. previous record moral reputation. The borrower must give a blank cheque for security. The main types of their finance are: • • • Project Finance Agriculture (Development) House building Finance. All the loans may be fund base or non-fund base. Guarantee.C. They think thousands times before lending to the borrower. nature of business. which is repayable to them on demand.2 Medium & Long Term Finance These finances are issued for production & development of industry & agriculture e. registered company’s employees. Fund Base loans are those which given in cash form to the borrower. These are issued for the period of 5 years or more. The credit character is base on the borrower’s willingness to pay her obligation. Banker is very conscious while using these funds.bonds etc. L. 3. 42 . for buying input or building for industry. Three Advance Salaries is given to Govt. Example for their loan is Three Advance Salary.13. Banks run their business with the money of depositor. They must keep in mind the following factors before advancing the loan:Character The first and most important factor considered in the credit analysis is character.

then less amount of credit may be given against the value of assets. bill of lading warehouse receipt. plant. If the assets of borrower are liquid. Before advancing the loan bank must be satisfied with the repayment of fund by checking following resources of borrower.Capacity to Pay The bank should judge the financial condition of the borrower. Banker should not extend loan on up to the full Value of collateral 43 . • • • Capital The asset of the consumer may be in form of horse motorcar. Before Sale of Assets Income Location of Plant etc. The banker should keep in her maid the owner’s participation in her business. building etc. Bank must be carefully examining their Collateral security before advancing the loan for security purpose. If assets are not liquid. The bank should extend the loan in the proportion to the asset head by them. furniture etc. Before landing the loan the banker should examine the value of her business and its prospectus in future. The collateral security may be consisting of stock. bill of exchange. Collateral Collateral means an additional security given against the loan. bonds etc. he may be giver large amount of credit. advancing the loan the banker should preferred get the security of liquid assets because they can be converted into cash easily. machinery. Whether he is able to repay that amount of loan which he wants to get. The banker should not provide loan more than capital. The businessman may own assets in the form of new material.

Legal contract between bank & borrower on a security bond. Valuable security. immovable property is pledged by the bank & bank is required a real value of that property for sanctioning a loan. A written application. In hypothecation bank does not interfere in the business of borrower. Promissory Note. 50% etc. Insurance of References (at least two) Latest Financial statements. Pledge 44 . Trust Receipt. which are issued by the govt. Securities Before giving a loan to borrower a bank required a valuable security in three ways: • • • Hypothecation Pledge Mortgage Hypothecation In Their type of security. The other collateral may set 40%. Lien mark in favor of bank. loan against the value. Margin for their security is 50%. Authority letter. The securities. Main Requirements for Sanctioning Loan • • • • • • • • • • • • ID card copy.. Financing Agreement on a prescribed form. may be given 100% loan against them.

Mortgage All documents of ownership & registration of movable property is submitted to the bank with an authority letter which has an agreement to give authority of selling property in case when borrower will not repay the loan after a fixed period. borrower cannot use raw material & cannot sell its production without the presence & permission of the agent of bank. The stock must be insured.In Pledge the bank has 90% shares in business of the borrower. security against which he is applying for loan. In their type of security bank pledge the stock & raw material. then no need of balance sheet. Stock is controlled & managed by the bank. 45 . If loan amount is below Rs.000. Following is the procedure of taking loan from NBP. The bank has a right to sell the production & interfere in business transactions. First of all application form is filled in which the person who wants to take loan mentions the purpose of taking loan. 500.

1.4 FINANCIAL ANALYSIS 4.1 Five Years at a Glance Total Assets 1000000 800000 600000 400000 200000 0 2005 2006 2007 2008 2009 Graph: 4.2 46 .1 Deposit 800000 700000 600000 500000 400000 300000 200000 100000 0 2005 2006 2007 2008 2009 Graph: 4.1.CHAPTER NO.

1.Advances 500000 400000 300000 200000 100000 0 2005 2006 2007 2008 2009 Graph: 4.4 47 .3 Investments 250000 200000 150000 100000 50000 0 2005 2006 2007 2008 2009 Graph: 4.1.

Shareholder’s Equity 100000 80000 60000 40000 20000 0 2005 2006 2007 2008 2009 Graph: 4.1.6 48 .1.5 Pre-Tax Profit 30000 25000 20000 15000 10000 5000 0 2005 2006 2007 2008 2009 Graph: 4.

1.1.7 Earning Per Share 20 15 10 5 0 2005 2006 2007 2008 2009 Graph: 4.After Tax Profit 20000 15000 10000 5000 0 2005 2006 2007 2008 2009 Graph: 4.8 49 .

Ratio analyses
Financial ratio is an index that relates two accounting numbers and is obtained by dividing one number by the other.

4.2Types of ratios & Calculation
Following are the types of ratios

4.2.1 Liquidity ratios
Ratios that measure a firm’s ability to meet short term obligations. 4.4.1 4.4.2 Current ratio Quick Ratio

4.4.3 Net working capital 4.5 Leverage Ratios:
Leverage ratios measure the extent to which a firm has been financed by debt.

4.5.1 Advance to total deposit ratio 4.5.2 Total turn over ratio


Profitability ratio:
Profitability ratios measure management’s overall effectiveness as shown by

the returns generated on sales and investment. 4.6.1 4.6.2 4.6.3 4.6.4 4.6.5 4.6.6 Return on total assets Earning per share Return of deposit Margin on profit Debt Ratio Interest covered ratio

These Ratios are defined and calculated below.



Liquidity ratios
Ratios that measure a firm’s ability to meet short term obligations.

4.4.1 Current ratio

Current ratio= current asset/current liabilities Table: 4.4.1
YEAR Currant Assets Currant Liabilities Current Ratio 2007 Rs.30994965 Rs.30940041 1.00 2008 Rs.44550347 Rs.39656831 1.12 2009 Rs.59316438 Rs.42269623 1.40

1.4 1.2 1 0.8 0.6 0.4 0.2 0 2007 2008 2009

Graph: 4.4.1

The current ratio compares the liquid assets with short term liabilities. The ratio express that in 2008 the current ratio of NBP was 1.12 times and in 2009 the ratio increased to 1.40 times. The ratio shows that both in 2008 and 2009, the current ratios were fair enough to cover its short term liabilities with current assets.


4.4.2 Quick Ratio
This ratio is calculated by dividing the current assets like cash and receivables to current liabilities.

Quick Ratio= Cash/ Current liabilities Table: 4.4.2
YEAR Cash Current liabilities Quick ratio

2007 Rs.94873249 Rs.30940041 3.06

2008 Rs.106503756 Rs.39656831 2.68

2009 Rs.115827868 Rs.42269623 2.74

3.5 3 2.5 2 1.5 1 0.5 0 2007 2008 2009

Graph: 4.4.2

The quick ratios were 3.06, 2.68 and 2.74 in 2007, 2008 and 2009 respectively. The ratio express that there is enough cash great in 2007 to fulfill the current liability, but this case is low in 2008 and in 2009 it is rather high. This means there is increase in the asset in the year 2009 as compare to the liability.


4.59316438 Rs.30994965 Rs. As we observe that the current asset are increasing year after year which is good indication for the bank.4. because now in 2009 bank have more to investment which mean more earning.3 Comments Working capital is increasing which shows that there is an increase in current assets.4893516 m 2009 Rs.54924 m 2008 Rs.44550347 Rs.42269623 Rs.17046815 m 20000000 15000000 10000000 5000000 0 2007 2008 2009 Graph: 4.4.39656831 Rs.4. 53 .30940041 Rs.3 Net working capital Formula Net Working capital = current assets – current liabilities Table: 4.3 Year Current assets Current liabilities Net Working capital 2007 Rs.


Leverage Ratios
Leverage ratios measure the extent to which a firm has been financed by debt.

4.5.1 Advance to total deposit ratio
It is calculated by dividing advances by total deposits Formula
Advance to total deposit ratio = advances Total deposits

Table: 4.5.1
YEAR advances total deposits advance to total deposits

2007 Rs.340667100 Rs.591907435 0.58

2008 Rs.412986865 Rs.6249390160 0.66

2009 Rs.475243431 Rs.726464825 0.65

0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2007 2008 2009

Graph: 4.5.1

As we can see the deposits increase which mean the customer are depositing more in bank but the advances decreased means that bank has provided less advances to customers than the previous year.

4.5.2 Total turn over ratio


It can be calculate by dividing total income by total assets Formula Total asset turnover = total income Total assets

Table: 4.5.2
Year Total income Total assets Total asset turnover

2007 Rs.64114326 Rs.762193593 0.084

2008 Rs.77358660 Rs.817758326 0.094

2009 Rs.78556322 Rs.944232762 0.083

0.1 0.08 0.06 0.04 0.02 0 2007 2008 2009

Graph: 4.5.2

The ratio shows inefficiency of the company uses its assets to generate profit. This means that the bank has turnover of assets 0.083 time this year less thin as compare to previous year. The company did not manage its assets more efficiently according to the ratio.


Profitability ratio


Profitability ratios measure management’s overall effectiveness as shown by the returns generated on sales and investment.

4.6.1 Return on total Asset

Return on total assets Table: 4.6.1 Year net profit Total assets Return on total assets


net profit Total assets

x 100

2007 Rs.19033773 Rs.762193593 2.2%

2008 Rs.15458590 Rs.817758326 1.89%

2009 Rs.18211846 Rs.944232762 1.93%

2.5 2 1.5 1 0.5 0 2007 2008 2009

Graph: 4.6.1

The result shows that the bank has generated less profit in 2008 as compare to 2007 but it try better in 2009 to increase the profit. The result shows that bank did not use it resources to generate profit.


6.68 2008 Rs.4.2 Earning per share It is calculated by dividing net profit to no.92 20 15 10 5 0 2007 2008 2009 Graph: 4.2 Comment As we can observe that in 2007 Earning per share is greater which is 17.6. of share Table: 4.19033773 Rs24305938 17.18211846 Rs.3584307 14.6. This result shows the performance of NBP which is good in 2007 as compare to 2008 and 2009.15458590 Rs. of share Formula EPS = Net profit No.5. 4.3 Return on deposits 57 .38 2009 Rs.3584307 16.68 as compare to 2008 and 2009. of share EPS 2007 Rs.2 Year Net Profit No.

58 .51% in 2009 which is 2.591907435 3.624939016 2.3 Year Net profit Total deposits Return on deposit: 2007 Rs.15458590 Rs.5 2 1.6.726464825 2.47% and 3.5 3 2. The result reflect that the NBP in going down in term of return to it customer on deposit which is good in 2007.2% 2008 Rs.18211846 Rs.2% in 2007 and 2008.47% 2009 Rs.5 0 2007 2008 2009 Graph: 4.5 1 0. Formula Return on deposit: = Net profit Total deposit x100 Table: 4.6.51% 3.It is calculated by dividing net profit with total deposit.3 Comments The graph shows that the Return of deposit in decreasing with time to time. as it is 2.19033773 Rs.

82256425 22.1% 30 25 20 15 10 5 0 2007 2008 2009 Graph: 4.19033773 Rs.15458590 Rs. 59 .9% 2009 Rs.18211846 Rs.6.64114326 29.69% 2008 Rs.4 Margin on profit It is calculated by dividing the net profit by total income Formula Margin on profit = net profit Total income x 100 Table: To observe the graph we see that 2007 is the best and in 2008 there is down fall which is recovered in 2009.4 Comment Profit margin is decrease because of the less deposit and profit earning of NBP during 2009.77358660 19.4 Year Net profit: Total income Margin on profit: 2007 Rs.

Which mean that bank have more liability than owner equity and it is increasing year to year. the greater the amount of other people money being used to generate profit.5 Year Total Liability Total assets debt ratio: 2007 Rs.4 0.8733 1 0.817758326 0.762193593 0.6.8747 2009 Rs.715299108 Rs.2 0 2007 2008 2009 Graph: 4. It is calculated as Formula Debt ratio = Total Liability Total assets Table: 4.645855939 Rs. 4.824676384 Rs.6 The interest covered ratio 60 .5 Debt ratio The debt ratio measure the proportion of total assets financed by the firm’s creditors the highest the ratio.944232762 0.6.85 2008 Rs. 0.6 0.5 Comment The decrease debt ratio shows increased share of debt in total assets as compare to owner equity.

It shows the firm ability to make the interest payment. 61 .94 2008 Rs.5 2 1.6 Year PBIT Interest expense Interest covered ratio = PBIT Interest expense 2007 Rs.It is also called interest covering ratio.45814070 Rs.14391079 2.42503078 Rs.5 1 0.23513897 1.17 2009 Rs.19502080 2.42451580 Rs.6. As we observe that bank pay more interest in 2007 as in this year performance of bank is good as compare to other years.5 0 2007 2008 2009 Graph: 4. Which mean bank pay more interest in 2007.95 3 2.6 Comment The graph shows the decrease in payment of interest to it customer and equity holder. It is calculated as Formula Interest covered ratio Table: 4.6.

7 Item 2007 Increase (decrease) %age Cash Lending to F.7 Horizontal analysis of Balance Sheet Rupees (000) Balance sheet (assets) Horizontal analysis As on 31st December 2007-08-09 Table: 4.I.4. Balance with other banks Investment Advances Fixed assets Other assets 100 100 100 100 100 100 100 2008 Increase (decrease) %age 112 80 102 81 121 93 144 2009 Increase (Decrease) %age 122 91 76 103 140 97 191 Balance sheet (liabilities) Horizontal analysis As on December 31st 2007-08-09 Table: 4.7 Item 2007 Increase (decrease) %age Bills payable Borrowing Deposit & other accounts Other liabilities 100 100 100 100 2008 Increase (decrease) %age 145 37 106 128 2009 Increase (decrease) %age 150 419 123 136 62 .

A 100 100 100 126 116 45 143 135 53 Balance Sheet Horizontal Analysis Comments Assets • Cash is increased in 2009 and decreased in 2007 but it remain constant increase in 2008 . • In the field of investment there is increasing in 2009 but decreasing trend in 2008. Therefore it is a good sign for bank. • Increase in money at call and short notice. It is common term of finance "more investment more return".7 Item Share capital 2007 100 2008 110 2009 132 Reserve Un-appropriate profits Surplus on revelation of F. 63 . Therefore.Balance sheet (owner equity) Horizontal analysis As on december 31st 2007-08-09 Table: 4. bank should take the necessary steps according to the position.It shows that the liquidity position\of the bank is going to Strong. it means that customers of the banks are very punctual in making payments. • There is decreasing trend in balance with other banks which is not a good sign. so it is alarming sign for the bank.

Owner Equity • Share capital increases that show the creditability of the bank.• As we know that main source of profit of the bank is the difference between the percentages of interest. Assets of the banks are increasing day by day by purchasing the assets. 64 . There is median trend in field of fixed assets. in same way NBP increasing its profit. Other liabilities have an increasing trend not good because increase in liabilities decreases the liquidity position of the organizations. It means NBP running very well. Bank purchase asset in 2007 but in 2008 it asset decrease but in 2009 they are increase. Although it is seeing that bank's borrowing is fluctuate with the passage of time which is not positive sign. • Other assets have increasing trend which is not appositive sign. Bank pay less rate of interest than receiving the interest from the customers. Liabilities • There is an increasing trend in deposits and other accounts which shows the credibility of the bank. • NBP is in a position that it is earning more and more profit with the passage of time. Decrease on assets decrease the worth of the organization. Usually banks borrow money when they would have to give it for earning more profit. • • Bills payable increase in which is a positive sign. More assets mean bank has more capacity to pay of its liabilities. In this case advances to increase in coming year with time to time. • Borrowing is increasing in 2009 that is the positive sign. Then bank can purchase more and more fixed assets. and it is bank is doing. It is due to purchase of new assets.

92 2.390 2.8 Items Cash and balances with treasury banks Balances with other banks lending to financial institutions Investments Advances Operating fixed assets Deferred tax assets Other Assets total Assets 2007 12.82 27.• The NBP increasing its reserves and un-appropriate profit in order to increase its lending power.33 2.40 0.890 50. a bank ca lend money equal to the 30% of its assigned capital plus reserves.70 44. 4.01 2.100 100 2009 12.020 4.07 23.65 3.05 50.66 0.28 100 65 .690 20.8 Vertical Analysis of Balance Sheet Rupees (000) Balance sheet (assets) Vertical analysis As on 31st December 2007-08-09 Table: 4.450 0.07 100 2008 13.32 6.00 4.27 3.960 5. because according to the prudential regulations of State Bank of Pakistan.45 4.500 2. which is good sign.

01 0.66 87.09 0.8 100 5.36 23.46 100 2008 11.77 22.72 100 66 .49 88.13 100 2008 1.005 Rupees (000) Balance sheet (owner equity) Vertical analysis As on December 31st 2007-08-09 Table: 4.1 1.47 100 2009 11.77 65.79 4.02 24.Rupees (000) Balance sheet (liabilities) Vertical analysis As on December 31st 2007-08-09 Table: 4.37 0.54 100 5.004 2009 1.65 0.29 5.8 Items Bill payable Borrowing deposits and other accounts sub-ordinated loans liabilities against asset subject to finance lease deferred tax liabilities other liabilities total liabilities 2007 1.43 5.93 64.51 64.67 91.8 Items share capital Reserves Inappropriate profit Total owner Equity 2007 11.

• In 2008 investment are going higher and NBP applied his 50% resources in investment. • In 2009 70% of bank resources are applied in investment and advances. also investment are also high which show the earning in future.2008 and 2009 the deposit and other account are very high which shows that bank have to pay interest. More the investment more the earning.32 123. 4.2007 2009 % 2008 % 2007 % Mark-up /return/ interest earned 155.30 100 67 .Balance Sheet Vertical Analysis Comments Assets • To see the analysis I come to know that in 2007 advances are more than other asset which is good for bank.9 Income Statement For the Years 2009. Liability • In 2007. Owner Equity • Equity shows that bank have lot of reserve to pay the interest and also can investment the money to earn more.2008.9 Horizontal Analysis of Income Statement Table: 4.

47 131.42 Other charges Total non-mark-up / interest expenses Share of profit of associated undertaking Profit before taxation Current year Prior years Deferred Share of tax of associated undertaking Profit after taxation Basic and diluted earnings per share .61 129. 68 .86 121.70 26.86 291.63 129.10 133.35 83.69 1380.63 -32.33 60.48 105.49 86.11 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 Comment • As we see that there is constant increase in income which mean that NBP is working well.14 123.48 208.80 4527.71 98.42 95.13 118.11 61.62 123.75 2214.51 115.86 119.57 92.22 131.19 174.10 131.82 Total non-mark-up / interest income Non-mark-up / interest expenses Administrative expenses Other provision / (reversal) .80 100.19 122.20 248.01 102.27 116.Mark-up/ return/ interest expensed Net Mark-up /return/ interest income Provision for diminution in the value of investment .04 71. commission and brokerage income Income earned as trustee to various funds Dividend income Income from dealing in foreign currencies Gain on sale of securities .99 113.57 131.04 119.15 103.21 -217.29 112.34 258. • See the analysis we observe that bank fee.24 1213.52 88.80 963.28 6. commission and brokerage income are increasing with time to Bad debts written off directly Total Provisions Net mark-up /interest income after provisions Non-mark-up / interest income Fee.98 1470.72 0.after tax 257.nrt Provision against non-performing loans and advances .72 122.66 Other income .60 339.84 173.40 -145.

05 Dividend income 1.74 0. which mean bank pay less dividend.28 0.15 20.72 0.35 0.18 4. 4.47 3.00 2.93 0.01 3.00 Total non-mark-up / interest income 14.02 1.51 0.33 advances .net 3.59 77.02 provisions Non-mark-up / interest income 0. • As we see that expenses of bank are also increase in term of administrative expenses and other charges.95 Net Mark-up /return/ interest income 71.13 Income from dealing in foreign currencies 1.69 2.• Dividend income decrease which shows that bank payment decrease.82 Gain on sale of securities .49 86.2007 2009 Mark-up /return/ interest earned 100 Mark-up/ return/ interest expensed 28.00 Fee.00 9.2008. • Bank earn more through foreign currencies which mean bank deal good in foreign country.02 0.00 0.89 2.24 19.10 Vertical Analysis of Income Statement Table: 4.10 Income Statement For the Years 2009.70 investment .05 Provision for diminution in the value of 6.19 1.13 2007 100 17.64 65.18 4.00 -0.72 75.31 0.81 75.64 0.00 classified as held for trading Provision against non-performing loans and 3.33 9.19 Income earned as trustee to various funds 0.11 69 .82 2008 100 24.25 Other income . commission and brokerage income 7.04 Net mark-up /interest income after 61.68 2.00 8.00 9.00 2.49 82.87 Unrealized loss on revaluation of investments Bad debts written off directly Total Provisions 10.93 0.

16 0.72 26. So.14 2.93 0.00 25.after tax 0.03 2.11 -0.53 1.23 0.24 0.78 48.00 17.96 Comment To see the analysis we observe that the bank have earn more in 2007 which is decrease in 2008 and in 2009 it income also decrease as compare to 2007.02 19.84 73. by the help of environmental analysis and organization structure we can find out the opportunities and threats and then match with the capabilities if the organization.08 54.00 20.30 0.1. CHAPTER NO.85 70. opportunity and threats) provide a complete knowledge of the organization to compete in the industry.42 0.30 21.06 16.1 STRENGTHS 70 .5 SWOT ANALYSIS 5.39 38.33 -4.26 24.01 2. weaknesses.04 0.65 0.00 18.17 0.07 2.39 Other charges Total non-mark-up / interest expenses Share of profit of associated undertaking Profit before taxation Taxation Current year Prior years Deferred Share of tax of associated undertaking Profit after taxation Basic and diluted earnings per share .04 0.10 24.25 0.1 SWOT Analysis SWOT ANALYSIS (strengths.45 -2.83 0.Non-mark-up / interest expenses Administrative expenses Other provision / (reversal) .00 18. Also earning per share increase which is pay a greater roll in 2008 and 2009. 5.05 19.00 22.12 3.64 19.26 25.14 51.86 0.

This is the reason that the Pakistani nation has complete trust over the bank that its deposits are fully secured.. But the advances this loan to public he earns profit on its which increase his over all income. I.e. • There are more than six million clients of National bank. This function makes the NBP able to earn profit on the Gold. 71 . Their customers are served all over the Pakistan and abroad. • National Bank of Pakistan is providing different types of loans on Mark-up and no Mark-up bases to its employees. The number of employees of the bank is12195.• National bank of Pakistan is a government owned bank. • The most important point of National bank is that it is agent of State bank of Pakistan. for this purpose IT Centers have been set up at different places where short courses of computer are taught. starts some scheme of loan to assist the public normally NBP is authorized to implement it. Its branch network is one of the largest in Pakistan (29 Regional Offices and 1189 branches) and (15 Overseas Branches). WAPDA and Sui gas.A. Motorcycle Loan.I. For this it is provided with the funds from the Govt. Computer Loan. where the State bank branches are not working National bank control its function. • National bank of Pakistan is enjoying the deposit of different government organization like P. • When Govt. Pakistan Railway. • Only the NBP is authorized to advance loan against Gold. House Building Loan etc. Car Loan. This function becomes the major source of income of NBP. • Government has providing facilities through National Bank of Pakistan to get the knowledge of computer.

and commerce professionals. • No bonuses and other cash prizes are given to employees for motivational purposes against extra time on job. And rate of the loans converted in to bad debts is high. Generally. • Personal use of the bank assets by the branch managers. It should be computerized.1. 72 .WEAKNESSES • The staff is working partially on the bases manual record system and computer record system. Pakistan’s business educational institutes and universities are producing MBA’s. bank can recruit skilled and advanced knowledge persons for strong management. which is not healthy for the bank. • The human resource department of NBP is not performing its duties as well. • • Golden hand shake may decrease the establishment expenses of the NBP. Banking is experienced just book keeping only. after all we have to adopt electronic media for IT revolution in future. education and professional skills.3 OPPORTUNITIES • A gradual reduction in the corporate tax rate for commercial banks will have a positive impact on their earnings. BBA’s. training and development. the attitudes of the employees are not serious with each other and have professional jealousy. recruiting. • The political involvement in bank affairs resulted in lake of strategic decisions. • Whole the management and staff of the bank have not the relevant knowledge of banking business. 5.

5.e. so it may lose its market share in the future. RECOMMENDATION & SUGGESTION 6.1. • Because NBP is a financial institution so if there is any mistake it may create a lot of problems for the bankers so it is a stress for the employees to non correctness of the accounts. • There may have some frauds. CHAPTER NO. Which may create the trust and goodwill among the customers. • Most of government accounts are with NBP. UBL. Government of Pakistan is responsible for all deposits which are made by the National bank of Pakistan. MCB.• Foreign currency account holders can adjust their loans with their foreign currency. robbery or other mishaps with the banks so all the time employees have to remain careful. • The number of banks in Pakistan is increasing day by day and they are providing good customer services as compared with the NBP. Bank AlFalah etc are providing loans and advances at lesser rate of interest. as the pay in NBP is less than the remuneration offered by other banks.2 Findings 73 . Other commercial banks i. Askari commercial Bank. so political influence is there. 6 FINDING. • The competent employees of NBP may move to other banks.4 THREATS • Being a government bank president of The Bank is appointed by government.

The follow of communication information is very slow as there is a gap between various counters. which are absorbed and experienced.During the short span of two months internship in NBP Sarai Salah branch Haripur and roughly spent one week on each counter. It automatically creates a lit of noise and disturbance in the bank.1. Problem at the branch 2. But although though some observations it is pointed out that there are some shortcomings in the bank. And when the reached the counter the attitude of the officer really dishearten them.2. The old age pensioner’s accounts are also there. To handle the old age people are not an easy task.2.1 Communication problems between the employees: There is a single hall in the branch and the staff of the bank use peon or clerical staff to communicate with each other. Function analysis 3. So if the officer wants to verify or sign any balance or document it has to be moved thorough peon. Mainly it is in the beginning of the month when pensioners come to collect their payment. and also narrated by the concerned personnel of the bank. 1. Personal management’s analysis 6. In this branch the staff is limited and the customer wait for along time. The officer dealing with them has to be very perfect.2 Limited staff It is noticed during the internship period that. this short span is not sufficient for having all the information about the organization. 6. So the findings are divided into four major parts which are as under.1 Problems at the Branch 6. They wait for a long time to receive the pension. competent and patient.1.2. administrative analysis 4. 74 . NBP also deals with almost all the government affairs.

2.2 Functional Analysis 6. It provides a base when people to communicate with each other. In this branch there is a computer but no one among the staff can not operate it properly.1.2.2 Difference between Theory and Practice A vast difference exists between theory and practice and NBP the written procedure is some what different from the practice which is done by employee. and coordinated towards a given objective. 6.2.2. Modern age is” computer era” and usefulness of computer can not be denied. Branch has the computers but no one can operate them efficiently. They still face this problem. This slow down the progress of work. which are cautiously determined grouped.1 Formal Organization Formal organization includes the activities of two or more person. With the help of computer efficiency increases. The formal organization comes into being when people are able to communicate with one another are willing to act and sharing a purpose in this formal organization of NBP the activities are carried out more formal fashion. Maintain registers for the record.3 Lack of computer expert There is lack of computer experts in the branch. 6. In theory it provides basis for communication with one another but in practice it is not exercised because the employee at the level cannot got straight away SVP and ask him about any office in problem faced by him. when they have common purpose and they are willing work.6. because first he has to talk to his immediate superior.2 .2. 6. In NBP.3 Bank duty is to maintain secrecy 75 . He has to follow a proper channel for communication with his superior.2. we find a formal organization Bernard referred to an organization as a formal when the activities of two or more person are coordinated towards a given objective.2.

This creates problems both for organization and for the employee.2.3. trained.1 Job analysis is not effective Only on the basis of job analysis it can decide how a right person can be hired.2. he should be careful about his record.2. Address is very necessary because any thing can happen. 6.3. which should be followed for the opening of account. 6. 6. it may create big trouble for the bank. In this record another short fall is in giving the information about the balance on telephone they least bother to ask any other for verification. The deposit clerk must be care full while passing any cheque.In this branch they do not care about maintaining secrecy during the rush of routine business. the importance of the interrogation is that he may take any kind of financing from the bank.3 Administrative Analysis 6. Most of the employees are simple graduate and do not have proper know how about their job. This creates dissatisfaction among the employee. It is very important for an organization in which nature of the job described and job specification ara mentioned. So in case of default if you don’t have bio-data of that person. This is the basic rule. compensated or promoted. They should be careful in this respect. the staff does not bother to check his / here phone number and permanent address. In NBP wages and salaries according to the seniority and grades.3. People performing simple or complex responsibility are getting the same salary and facilities.3 Mobilization of Remittances: 76 .2.2 Carelessness in opening of Account When customer comes to open an account. They speak loudly about the account position of while getting clearance of cheque the person can easily get the whole information from the ledger.

unfortunately. The charges should be reduced. A function deposit and remittances is partially done in deposit department.2. People that there r more changes in commission charge by the bank. And this may also reduce overlapping of work. The band officials do not motivate the customer to send their remittances through banks. They send their money through hundi. there is an increasing shift to the use of informal means.Remittances are a basic function and main source of income for the bank.4 Lack of Specialized Training: National bank of Pakistan does not adequate facilities of specialized training to their staff. 6.3. Most of the customer of the bank NBP.5 Separation of Activities There is a lack of delineation of responsibility as such.2. main branch Islamabad is people living abroad. In bank. Since he does not have knowledge about the specific job assigned to him thus he feels difficulty to perform his job. As the worker finishes his training he is inducted in to a specific field. 77 . If these remittances sent through banks. Training is provided on the basis of generalization rather than specialization. 6. There should be complete separation of activities to avoid all this ambiguity. main branch the newly recruited employee training was not imparted but they all learn things on the job. it will be very beneficial for the bank and national economy.3. This create confusion and conflict in the decision making process. and partially in account department.

clear on objective and communicating better control on financial and administrative matter. It reduces the career opportunities to the worker as well as results in boredom and will not take interest in work. recruiting. 6.2. 78 .2 Developing Managerial Leadership Leadership is a practical term of visible. The newly recruited should be rated in all the department of the banking order. The training programmed of the bank. should include scientific technique to improve the decision making and interpersonal as well as individuals needs of the employee both specialized to fresh as well as on job worker to maintain the high standards of service. To get familiar with waking of different department so that when he gets a responsible position he have know how of the whole system.2. grievance handling taking immediate initiative in crises situation have to take major decision affecting the future of there bank and banking community.4.2.4 Personnel Management Analysis 6. Job rotation is very important for employees especially for those who are newly recruited. 6.6 Poor Job Rotation There is a absence of job rotation in NBP Sarai Salah Branch Haripur.2. It becomes essential to train him adequately for the task. They should learn new methods for motivating customer.6.1 Need for Better Training Programmed The need of training is felt the entire world. Training of the personnel is part of human resource management. Once a candidate has been selected and placed on the respective job.4. So the manager is not only responsible for their own units in business but also in people i.3.e training. A person placed in one department remains there forever. It has been noticed that the training programmed of NBP is not adequate. It becomes essential to been selected and placed on the respective job.

which provide the policy guide lines and ensure that the money market operate on sound professional bases. This creates a lot of problem.6.4. thus a better and impartial policy of promotion needs to be followed.4 Promotion Promotion in the national bank of Pakistan is purely on the seniority so the new young person having high qualification is into having any chance of promotion of their favorites which gave a sense of deprivation to the deserving employee and their efficiency is affected. 79 . more prestige.3Recruitment Policy Human resources are the lifeblood of the organization.4. 6.3 Recommendation National bank of Pakistan is an effectively operating and profit making organization and carrying out its activities under a specified system of procedures. The man regulatory body is state bank of Pakistan. While the head offices specifies the whole procedure of functions and operations. Both the staff unions and the top authority tries their best to recruits their favorites. This procedure has been modernized with the passage of time with a view to stream line the approach and the underline procedures of time with a view to streamline the approach and the underlying procedure for effective overhauling of its own capabilities so as to bring them at par with international practices. The bank is not following ots recruitment policy properly. which can add some input for efficiency and better performance of NBP as an organization in general and main branch Islamabad in particular.2. 6. greater skills and increased rate of salary. Here some suggestions are recommended.2. The person selected through these channel are influential and do not work for the betterment of the bank. If the personal are recruited carefully they can because an asset to the organization and in the case of carelessness the personnel can become a liability. Due to favoritism nepotism and political influence unsuitable candidates are selected. As the concept of promotion is attached better jobs better in terms of greater responsibility.

M. So National Bank of Pakistan should use electronic media for its business developments. companies or firms.• This is a computer era. 80 . their families.P should open new branches in these Republic. • Unsecured loan are not to be provided in case of banks directions. but NBP don’t issued this type of finance scheme.B. • Central Asian Republics (CARs) have great opportunities of new business so N. there is a place for this type of scheme in this bank. • Separate desk or counter should be established in every branch to provide the information as required by the clients. ABP and Citi Bank etc. • CREDIT CARDS are issued by the different banks like MCB. By the use of computer properly these branches can increase there working efficiency. is using media very effectively to increase the business of banks.B. • The environment of the offices should be comfortable so that the client and staff must feel comfort during business in bank. • Model Banks like City Bank. National Bank of Pakistan should computerize all its branches.C. • The interference of union in banking business should be minimized as it decreases the working efficiency of the employee as well as the bank. With the use of computer we can increase our efficiency. • There is needed to make the outlook situations of branches in those manners that can complete the other modern banks in the banking market.

skilled. reward and punishment system should be introduced. self-spoken and well-dressed staff should be rewarded and appreciated and lazy. A new monitoring system should be created to efficiently collect and utilize the feedback from the branches to support product development and enhance the quality of service.• There are some clients having sound and successful plan but without financially sound and providing securities bank should firms such policies that may solve this problem. All the employees should well train. • There are some employees untrained which decreases the efficiency of the bank branch. • Every year some of the employees should be sent for training to other countries and employees from other countries should be brought here. • There is too much dependence on handwork and they are not getting at with computer programmed. lethargic staff should be warned and punished. smart. All the branches of NBP should be computerized. In which employees give important to the bank and its customer. 81 . In my opinion each employee should have regular job change. • In commercial institutions like banks. The National Bank of Pakistan needs to improve the service orientation at its branches. Means achieve. • Bank management has to put its all effort to change the prevailing culture of the bank and to put the foundation stone of business oriented culture. • • Promotion should be given to competent persons on merit basis. • Most of the bank employees are sticking to one seat only. as these constitute the "front line" of the Bank in terms of contact with its customers. with the result that they become master of one particular job and loose their grip on other banking operation. educated.

consuming process.• To attract the customer in the future NBP have to make extensive effort to give facilities of retail and consumer banking. National Bank of Pakistan should not advance the money to those people as well as organizations who are addict of rescheduling of loans due to their political influences.4 Suggestion To remain in the market bank need to be vigilant in the eyes of customer. 82 . should go for computerization rather than manual work. which can improve its financial position. • The outlook and interior lay out of the branches is another thing which needs to be improved. even does not have a partially computerized system where as other new competitor banks are now going towards on-line banking services. 6. • The procedure of taking services from the bank must be made easier and straight forward not involving long difficult procedure for simple task. • At the time of giving loans. Plus the technology in the banking which will be necessary for future banking is another week area need to be stressed. should take keen interest to recover its bad debts. • Govt.P. In this time N. loan must be advanced to the well reputed business people and industries having good record of loan repayment. • It is requirement of time that N. so that people aware about he services of the banking and any addition which the bank as made in the portfolio of its services. One way is through promotion efforts. which is very slow and time. Instead providing loans to these persons. it is necessary to see the repute of customer towards loan repayment.B.P.B.

Because in many branches of National Bank of Pakistan manually system is prevail. as customer is the most important person for the bank. • It is need of time for proper recruitment and selection program. regular bonuses and incentives should be given to them.A. The deserved should be made permanent employees.• For increasing the efficiency of N. . Deterioration in efficiency is mostly due to promotion without merit.A. • In most branches of NBP many employees who re working on ad-hoc basis creating dissatisfaction. So promotions must be awarded on merit and also when due.P.B. officers as well as clerical staff they must be trained by qualified person. • • NBP should focus its attention towards the share of traveler cheque. With the trained employees they will improve their efficiency of work. • Incentives and beneficial schemes to the customers as other competitor banks are doing so. 83 . D. Present training program for its officers is need to be improved. as this program instead of improving the efficiency of officers is merely a burden for the bank in the form of heavy T. • There must be a friendly environment among all the employees as is enhance the trust and sincerity. • • Political influences in the bank should be eliminated. • Special attention should be given to the behavior of the employees towards the customers. To motivate the employees of the bank. cost. New young talent should be introduced to inject the new ideas.

• Branch manager should be trained in the field of selling to serve better according to the expectation of customers. Facility sends them other branch. • • • The recruitment policy should be fair and transparent. Bank should hire expert staff for such type of activities and start them here. 84 .• Management should increase the branch limit of expenditure to fulfill the necessary expenditure of personnel relation. • • The branch should improve his environment to attract more customers. In other words the employees should not discourage the clients. Due to these payments environment of bank influenced.

The work load has exceeded over the employees. NBP has its regional it centers network. Training Programs may increase the efficiency of the management as well as staff. which create tension and unpleasant environment among the employees. Other private banks are paying more as compared to NBP. which provides the base to Online Banking and other computer services to customer as well as employees. Due to downsizing in the National Bank of Pakistan. NBP is also providing the facility of training programs to its employees which may create the ability of modern baking in future prospects. Today the world has entered in to the computerization in every field of life. NBP should increase and revise the pay scale of its employees. The fact creates dissatisfaction of job of employees.Chapter No.7 CONCLUSION & REFERENCES 7. accuracy of the work and efficient services in the banking business.1 Conclusion Being the government bank nation of Pakistan has much trust over the bank have its an opportunity for the organization to increase the market share of the organization. National Bank of Pakistan works as an agent of the State Bank of Pakistan which helps to increase the profit of the organization. They have to work over 10-12 hours. 85 . It provides time saving.

(1989). N. O. (1979). Dallas. sixth Ed. Principles and practice of management. 86 . Aspen System Corporation.” 3rd edition. p 349 Greenly. D. (1976). Delhi. strategic management.7. E. financial and management control. South Western pub. Dewitt. Lung King tong co. Edward J.(1983) managing human resources. 3rd Ed. Practice and law of banking in Pakistan. Irwin. Richard D. 6th edition. Kennedy. (1985) . Retrieved on April 20. r McGraw Hill Co.2 Reference and Sources Avashti. “personnel administration and industrial relations. Gorden. Bombary: move publishing Hong Kong. Royal Book Co. Karachi. (1986). 7th Ed. Asrar.D resources. managing organizational change dangers and opportunities report. Chhabra. Homewood. 2010 from http://www. (1973) and financial statement analysis and Interpretation. modern economic theory . GA. Public Ralph dale.R printing services. Shariran. ed. 2008.nbp. T.Tokyo. Atlanta. King. Daryl R. Conner. McGraw Hill Co. 2008 form http://wwwscribd. USA. NBP Internship report. (1983). 3rd Ed. 1984. siddique. Retrieved on November 15. organizational behavior. H.Co. New York: MC Graw Hill Book company. David. A Health care perspective. Edward Arnold press. Annual report NBP. K. (1987). Grant smith. Chruder Sherman. Edwin. Lusk. Banking and Money.K (1984).d. principles of personnel management. 2009. b. UK McGraw Hill book company. Fred Luthens. (1983). inc.N (1985).

Annexure (a) 87 .

(b) 88 .

(c) 89 .

(d) 90 .

(e) 91 .