NameofOrganization:

Executive summary
To interrupt my skills and educational knowledge of Finance I done my
internship in
National Bank of Pakistan Mailsi Branch District Vehari and to know
how I will work
in financial institutions and among various types of people have
different attitude.
The objective of this Internship was to explore the issues relating to
Finance and to
find out problems regarding the theoretical concepts with practical
experience
working in an organization during the internship and study the system
of National
Bank of Pakistan. There are many possible improvements, which we
can make
positive changes in the system.
There is shortage of employees in the organization. With development
of online
banking system the load of work can be decreased. All the staffs do
not know about
computer. There is almost one or two employees are trained to operate
the system in
every branch. Especially, the cash department is not familiar with
computer and
information system.
It is not easy for it to implement a new system immediately it takes a
lot of time to
replace systems. Once implemented its testing takes more time. So it
is important for
the Bank to develop a research department for redesigning the
operations of the Bank.
The Finance of the bank is experienced but not adequate with the
changing
environment of financial institutions. I observed that seniors are
illiterate of computer
and not technical hands. New comers have more knowledge about
business
administration and skilled in information technology. To update the
skills, it is
suggested to develop human resources training programs and
refresher courses.
4

NATIONAL BANK OF PAKISTAN

(Incorporated under the National Bank of Pakistan Ordinance, 1949)
National Bank of Pakistan (the bank) was incorporated in Pakistan
under the National
Bank of Pakistan Ordinance, 1949 and is listed on all the stock
exchanges in Pakistan.
Its registered and head office is situated at I.I. Chundrigar Road,
Karachi. The bank is
engaged in providing commercial banking and related services in
Pakistan and
overseas. The bank also handles treasury transactions for the
Government of Pakistan
(GoP) as an agent to the State Bank of Pakistan (SBP). The bank
operates 1,243
(2007: 1,232) branches in Pakistan and 22 (2007: 18) overseas
branches (including
the Export Processing Zone branch, Karachi). Under a Trust Deed, the
bank also
provides services as trustee to National Investment Trust (NIT)
including safe custody
of securities on behalf of NIT.

Table of Contents
MC062000032 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
........................................................
1
Dedication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
.............2
Acknowledgement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
......3
Executive
summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.......................................................4
.........................................................
.........................................................
.....................4
Internship
Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
......................................................5
Table of
Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
..6
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
............7
.........................................................
.........................................................
.....................7
Overview of the
organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Organizational structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
. 20
Number of employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
International
Level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Plan of your internship
program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Introduction of
Branch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
xiv) Islamic
Banking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Functions of the Finance Department . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Accounting system of the organization . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Finance system of the
organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Use of electronic data in decision-making . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Mobilization of funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.......................................................
29
Generation of
funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Allocation of
funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Critical analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
. . . . . . . 29
.........................................................
.........................................................
. . . . . . . . . . . . . . . . . . . 33
SWOT Analysis of the organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
.........................................................
. . . . . . . . 35
. . . . . . . . . . . 35
Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
. . . . . . 35
Threats . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
. . . . . . . . . . . 35
Conclusion &
recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
. . . . . . . . . . . 37
Annexes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
.........................................................
. . . . . . . . . . . . . . 37
.........................................................
.........................................................
. . . . . . . . . . . . . . . . . . . 38
6

NATIONAL BANK OF PAKISTAN

(Incorporated under the National Bank of Pakistan Ordinance, 1949)
National Bank of Pakistan (the bank) was incorporated in Pakistan
under the National
Bank of Pakistan Ordinance, 1949 and is listed on all the stock
exchanges in Pakistan.
Its registered and head office is situated at I.I. Chundrigar Road,
Karachi. The bank is
engaged in providing commercial banking and related services in
Pakistan and
overseas. The bank also handles treasury transactions for the
Government of Pakistan
(GoP) as an agent to the State Bank of Pakistan (SBP). The bank
operates 1,243
(2007: 1,232) branches in Pakistan and 22 (2007: 18) overseas
branches (including
the Export Processing Zone branch, Karachi). Under a Trust Deed, the
bank also
provides services as trustee to National Investment Trust (NIT)
including safe custody
of securities on behalf of NIT.
National Bank of Pakistan maintains its position as Pakistan's premier
bank
determined to set higher standards of achievements. 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,
technologically
oriented products and services offered through its large network of
branches locally,
internationally and representative offices.
The Bank is providing all banking services of mercantile and
commercial banking
permissible in the country, which includes:
• Handling of treasury transactions for the Government of Pakistan as
agent to the
State Bank of Pakistan.
• Providing services under a Trust Deed as Trustee to the National
Investment Trust
(NIT) including safe custody of securities on behalf of NIT.
• Accepting of deposits of money on current, fixed, saving, term
deposit and profit
and loss sharing accounts.
• Borrowing money and arranging finance from other banks.
• Advancing and lending money to its clients.
• Financing of projects, including technical assistance, project
appraisal through long

term short-term loans, term finance and musharika certificates, etc.

• Buying, selling, dealing, including entering into forward contracts of
foreign
exchange.
• Financing of seasonal crops like cotton, wheat, rice, sugar cane,
tobacco, etc.
• Receiving of bonds, scrip’s, valuables, etc. for safe custody.
• Carrying on agency business of any description other than managing
agent, on
behalf of clients including Government and local authorities.
• Generating, undertaking, promoting, etc. of issue of shares and,
bonds, etc.
• Transacting guarantee and indemnity business.
• Undertaking and executing trusts.
• Joint venturing with foreign dealers, agents and companies for its
representation
abroad.
• Participating in "World Bank" and "Asian Development Bank's" lines
of credit.
• Providing personalized Hajj services to intending Hajjis.
Branch Network
Presently the Bank is divided into 10 Groups headed by SEVPs/EVPs. 9
Regions
reporting to as many Regional Chiefs and 15 Single Branch Zones
headed by Zonal
Chiefs; 12 Corporate branches and 1,254 domestic branches headed
by Branch
Managers control its field operations.
With the geographical development of its branches, the Bank has been
able to extend
its services to a much larger number of Pakistanis all over the country.
Today it has
more than 8.5 million accounts. Bank maintains its presence in all the
major financial
centers of the world through its 21overseas branches and 4
representative offices. Of
these, three representative offices have recently been set up at
Tashkent (Uzbekistan),
Baku (Azerbaijan) and Almaty (Kazakhstan) to take advantage of the
emerging
opportunities in CIS countries. Bank’s role globally is well assisted by
its network of
correspondent banks located strategically in Asia, America, Europe and
Africa.
Apart from having a vast branch network, Bank is at the forefront in
the acquisition and
application of new technologies in every aspect of its banking facilities.
It has acquired
leased telephone lines for on-line banking. The Bank has 12 Regional
Computer Centers
to cover various on-line and batch system requirements of branches
and controlling
offices. Bank has also a presence on the Internet. It has modernized its
services by
installing Automated Teller Machines (ATMs) called "CASH LINK" at
selected
branches and presently 17 ATMs are operational in major cities.
Branch Network: (As of September, 2007)
1236 Domestic Branches, 18 Overseas Branches,
4 Representative Offices, 5 Subsidiaries and a Joint Venture.
Overseas Branch Network:
Paris, Frankfurt, New York, Washington D.C., Tokyo, Osaka, Hong Kong,
Kowloon,
Seoul, Bahrain, Dhaka, Chittagong, Ashgabat, Bishkek, Baku, Kabul,
Jalalabad and
KEPZ Offshore Banking Unit
Representative Offices:
Beijing, Tashkent, Chicago and Toronto
Subsidiaries:
CJSC Almaty, Kazakhstan
8
NBP Capital Ltd.
National Bank Modaraba Management Co.
Taurus Securities Ltd.
NBP Exchange Company Ltd.
Joint Venture:
United National Bank Ltd., UK
(Economic Indicators Pakistan, Published by Economic research Wing
NBP, Head
Office Karachi)
Present Status of the Bank
The new management team having extensive experience of
management of large
financial institutions both within and outside the country is expected to
further
enhance the profitability and operational efficiency of the Bank.
Prospects
The Bank's principal strategic going forward objective is to make the
transition from a
public service institution to a modern commercial bank. Being the
country's largest
financial institution, the Bank is uniquely positioned to leverage its
large branch
network and its 8.5 million-customer base to consolidate its core
businesses as well as
develop new revenue generating opportunities.
The new management team is in place combining the Bank's existing
personnel with
professionals recruited from outside. Operating procedures are being
re-defined and
internal controls strengthened utilizing a revamped IT architecture. A
brief on the
progress on some critical areas is as follows:
Corporate & Investment Banking
A new approach to corporate banking is underway. The Bank has
initiated a structured
approach to corporate banking by introducing a single point of contact
through
Relationship Managers (RMs). For this purpose, new RMs as well as
team leaders
have been inducted to expedite this process. Area Managers will be
appointed to
manage relationships and to better service the needs of multinationals
and large local
corporates.
In investment banking team has also been formed to offer specialized
services to
major relationships including advisory and debt syndications (TFCs).
Furthermore, to
stem the growth in non-performing loans, the existing risk / credit
management
practices at the Bank are being revamped.
Treasury / International Banking
The deregulation of foreign exchange treasury business has ensured
that a growing
Volume of business now flows through the inter-bank market where
rates are
determined by the market forces. This can prove to be an immense
profitable
proposition for the Bank.
Towards this objective, the Bank is shifting focusing on expanding its
market share in
trade finance, home remittance and foreign investment related forex-
denominated
flows.
9

Overview of the organization

Vision

To be recognized as a leader and a brand synonymous

with trust, highest standards of service quality,
international best practices and social responsibility.
Mission
NBP will aspire to the values that make NBP truly the Nation’s Bank, by
:
• Institutionalizing a merit and performance culture.
• Creating a distinctive brand identity by providing the highest
standards
of services.
• Adopting the best international management practices.
• Maximizing stakeholder’s value.
• Discharging our responsibility as a good corporate citizen of Pakistan
and in
countries where we operate.
Core Values
• Highest standards of Integrity.
• Institutionalizing teamwork and performance culture.
• Excellence in service.
• Advancement of skills for tomorrow’s challenges.
• Awareness of social and community responsibility.
• Value creation for all stakeholders.
10
Brief History
National Bank of Pakistan was established on November 9, 1949 under
the National
Bank of Pakistan Ordinance, 1949 in order to cope with the crisis
conditions, which
were developed after trade deadlock with India and devaluation of
Indian Rupee
in1949. Initially the Bank was established with the objective to extend
credit to the
agriculture sector. The normal procedure of establishing a banking
company under the
Companies Law was set aside and the Bank was established through
the promulgation
of an Ordinance due to the crisis situation that had developed with
regard to financing
of jute trade. The Bank commenced its operations from November 20,
1949 at six
important jute centers in the then East Pakistan and directed its
resources in financing
of jute crop. The Bank’s Karachi and Lahore offices were subsequently
opened in
December 1949.
The nature of responsibilities of the Bank is different and unique from
other
banks/financial institutions. The Bank acts as the agent to the State
Bank of Pakistan
for handling Provincial/Federal Government Receipts and Payments on
their behalf.
The Bank has also played an important role in financing the country’s
growing trade,
which has expanded through the years as diversification took place.
Today the Bank
finances import/export business to the tune of Rs. 52.7 billion, whereas
in 1960
financing under this head was only Rs. 1.54 billion.
The Bank has also played an important role in financing the country’s
growing trade,
which has expanded through the years as diversification took place.
National Bank of Pakistan maintains its position as Pakistan's premier
bank
determined to set higher standards of achievements. 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,
technologically
oriented products and services offered through its large network of
branches locally
and internationally and representative offices.
Bank of the Year 2001: awarded for the year 2001 by the world
renown “The Banker”
magazine owned by the Financial Times Group, London.
Bank of the Year 2002: awarded for the year 2002 by the world
renown “The Banker”
magazine owned by the Financial Times Group, London.
The Best in the Emerging Markets: World’s leading financial
journal, “Global
Finance” after a worldwide survey declared NBP in its issue of May
2003 as one of the
Best in the Emerging Markets.
The “Bankers Magazine” in July 2003 recognized NBP as the bank with
the highest
return on capital in Asia and No.8 in the world.
In its issue of March 2004, “Global Finance” has also declared NBP as
“The Best
Foreign Exchange Bank” in Pakistan.
In May 2004, NBP’s standard long-term rating was upgraded by JCR-VIS
Credit Rating
Agency to AA(double A) from AA- ( double A minus) with “stable
outlook” while
standalone short-term rating was maintained at A-1+ (A one plus). This
is now the best
rating for a local commercial bank in Pakistan.
WEBCOP-AASHA, an alliance against gender discrimination at
workplace, presented a
Recognition Award to NBP on December 18, 2004 for having a Gender
Sensitive
Management.
Bank of the Year” award for the year 2004 by the world renowned “The
Banker”
11
magazine owned by the Financial Times Group, London.
“Euromony” Magazine, a leading and prestigious journal, published
from London, UK,
in its issue of March 2005 has published Moody’s Investors Service
rankings in which
NBP in the only Pakistani bank which has been ranked among the Top
100 banks of
Asia for it performance in the fiscal year 2003.
World’s leading financial journal, “Global Finance” in an exclusive
survey has named
NBP as the Best Emerging Market Bank from Pakistan for the year
2005.
On an all Pakistan basis NBP was awarded the “Kisan Times Award” for
the year 2005
by the Prime Minister of Pakistan Mr. Shaukat Aziz, fir its services in the
Agriculture
Sector.
Bank of the year” awarded for the year 2005 by the world-renowned
“The Banker”
magazine owned by the Financial Times Group, London.
The “Banker Magazine” in July 2005 recognized NBP as the 10th Best
Bank in terms of
‘Profit on Capital’ in the world.
On the basis of overall financial performance during 2004, NBP has
been listed
“Amongst top 1000 banks in the world” and “Number 1 Bank in
Pakistan” by the
prestigious “Banker magazine” in its issue of July 2005.
The Asian Banker, a reputable financial journal, has published the
report of its research
project on the ranking of 300 of Asia’s Strongest banks based on a 11-
Dimensional
Dynamic Scoring Criteria has adjudged National Bank of Pakistan as
the Strongest
Bank in Pakistan.
“Best Bank-Pakistan” award for the year 2005 by world’s leading
financial journal
“Global Finance”.
Best Foreign Exchange Bank- Pakistan” award for the year 2005 by
world’s leading
financial journal “Global Finance”.
Due to consistent improvement in NBP,s Core Profitability, Asset
Quality and Economic
Capitalization in recent years, Moody’s Investors service upgraded the
Financial
Strength Rating (FSR) rom+ to D-, in November 2005.
Best Foreign Exchange Bank-Pakistan” award for the year 2006 by
world’s leading
financial journal “Global Finance”.
World’s leading financial journal, “Global Finance” has named NBP as
the Best
Emerging Market Bank from Pakistan for the year 2006.
Best return on Capital for 2006 amongst all banks in Asia “Banker
magazine” in July
2007.
Stable AAA/A-1+ (Tipple A/A-One Plus) rating (Standalone Basis) by
JCR-VIS (July
2007).
World’s Best Foreign Exchange Bank 2008” awarded by world’s leading
financial
journal Global finance”.
12
Nature of the Organization
National Bank of Pakistan is a Governmental Organization. It is
functioning as an
agent of State Bank of Pakistan. It implements the policies of SBP. Its
basic objective
was to extend credit to the agriculture sector. 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,
technologically oriented
products and services offered through its large network of branches. It
deals all Govt
Revenue, collection and payments of salaries, pensions and Govt
Treasury. It is a
complete commercial, retail and corporate bank as well.
National Bank of Pakistan is naturally a Financial Organization, which
deals with
lending, and borrowing and investing activities.
The National Bank of Pakistan a commercial bank generally makes
advances for a
period not exceeding one year, except in case of small and medium
industries for
which advance may be made for a maximum period of five years. The
bank makes not
only against the security of stocks and goods hypothecated or pledged
to the bank, but
also against documents of goods and properly, shares are various joint
stock
companies, Government securities, Insurance policies deposits
receipts, etc. The
margin, and rate of interest are determined by several factors
including the type of
security the size of loan and the integrity of the party.
The nature of responsibilities of the Bank is different and unique from
other
Banks/financial institutions. The Bank acts as the agent to the State
Bank of Pakistan
for handling Provincial/Federal Government Receipts and Payments on
their behalf.
The Bank has also played an important role in financing the country’s
growing trade,
which has expanded through the years as diversification took place.
National Bank of Pakistan maintains its position as Pakistan's premier
bank
determined to set higher standards of achievements. 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,
technologically
oriented products and services offered through its large network of
branches locally
and internationally and representative offices.
Business Volume
National Bank of Pakistan’s business volume is expanding day by day and
now it becomes
largest bank of the country.
(Rs. In Millions)
2003 2004 2005 2006 2007
Total Assets 468,972 553,231 577,719 635,133 762,194
Deposits 395,492 465,572 463,427 501,872 591,907
Investment 166,196 144,736 156,986 139,947 210,788
Interest Earned 19,452 20,947 33,634 44,014 50,569
Advances 161,266 220,794 268,839 316,110 340,677
Share Holder’s Equity 18,134 24,900 36,158 53,045 69,271
Pre-Tax Profit 9,009 11,978 19,056 26,311 28,061
After-Tax Profit 4,198 6,195 12,709 17,255 19,034
Earning Per Share (Rs.) 8.53 10.48 17.92 24.01 23.34
Return on Assets
(Per-Tax Profit) 2.0% 2.4% 3.4% 4.3% 4.1%
Number of Branches 1,199 1,226 1,242 1,250 1,254
13

Product Lines

National Bank of Pakistan serving following product lines:

National Bank of Pakistan Saiban Scheme

National Bank of Pakistan lending for construction of home
to general public as well as employees of government and
non-government institutions. Main features of this scheme are as
under.
• Finance available for home purchase, home construction, home
improvement
and Balance Transfer Facility.
• Period of repayment ranges between 30-20 years.
• Loan available up to a maximum of Rs. 15-20 million.
• NBP provide markup choices to its consumer i.e. Variable Discount
Rate,
Fixed Rate.
• Minimum approval and disbursement timing.
• Limited to areas where there are no documentations, fee, resale and
foreclosure related issues, so to protect the bank’s interest.
NBP Advance Salary Scheme
National Bank of Pakistan facilitates to employees with
advance salary under certain conditions.
• NBP facilities to employee by 20 Months salaries in advance.
• Minimum documents required for advance salaries scheme.
• Advance salaries are repayable in 60 months installments.
• NBP impose no processing charges, no collaterals and no insurance
on
advance salaries.
• NBP charged mark-up at 18 percent per annum on reducing balance
method.
14
National Bank Cash Gold Scheme
• National Bank provides facility of Rs. 10000 against 10 gms of gold.
• No maximum limit of cash.
• Roll over facility.
• Mark-up 14.50 percent per annum.
• Repayable after one year.
• No penalty for early repayment.
National Bank Kisan Dost Scheme
National Bank of Pakistan lending in agricultural field.
National Bank of Pakistan lending farmers for development of
agriculture sector of
the country under certain terms and conditions.
• NBP provide loan to farmers for production, development purposes,
for
purchase of tractors, for installation of tube wells, for purchase of
agricultural
instruments, micro loan, for construction of godwon, for construction of
fish
pond, for development of livestock and farming, for mil processing, for
cold
storage, bio-gas plants.
• NBP charged interest @ 14.5 percent per annum.
• NBP lending at farmer’s doorsteps.
• NBP facilitates to farmers with agricultural experts.
• NBP provide loans against agricultural passbooks, gold ornaments
and paper
securities.
National Bank Premium Aamdani Certificate Scheme
A monthly income scheme introduced by National
Bank of Pakistan for investors as well as for general public.
• Minimum investment required Rs. 50,000/-
• Maximum investment allowed Rs. 5,00,000/-
• A 5 years scheme with year wise increasing profit rates.
• Incentives available for investors.
• NBP provide finance facility against these certificates.
• NBP allowed to customers to convert existing deposits into
National Bank Premium Aamdani Certificates.
NBP Karobar Scheme
National Bank of Pakistan providing financing under President
Karobar Scheme. The purpose of this scheme to reduce unemployment
from the
country. Main features are as under.
• Age limit is 18-45 years.
• Finance limit to Rs. 200,000/-.
• Tenure of this loan 1-5 years.
• Markup rates are variable. i.e. KIBOR +2% per annum. The
customers will
pay 6% as long as government provides the balance markup to NBP on
monthly basis.
• NBP’S loan available for: Utility Store, Mobile General Store,
Transport,
PCO/Tele-centers.
15
International Baking
National Bank of Pakistan is at the forefront of international banking in
Pakistan
which is proven by the fact that NBP has its branches in all of the major
financial
capitals of the world. Additionally, we have recently set up the
Financial Institution
Wing, which is placed under the Risk Management Group. The role of
the Financial
Institution Wing is: -
To effectively manage NBP’s exposure to foreign and domestic
correspondence
Manage the monetary aspect of NBP’s relationship with the
correspondents to support
trade, treasury and other key business areas, thereby contributing to
the bank’s
profitability. Generation of incremental trade-finance business and
revenues.
NBP offers:
The lowest rates on exports and other international banking products.
Access to
different. local commercial banks in international banking.
DEMAND DRAFTS:
If you are looking for a safe, speedy and reliable way to transfer
money, you can now
purchase NBP’s Demand Drafts at very reasonable rates. Any person
whether an
account holder of the bank or not, can purchase a Demand Draft from
a bank branch.
MAIL TRANSFERS:
Move your money safely and quickly using NBP Mail Transfer service.
And we also
offer the most competitive rates in the market.
PAY ORDER:
NBP provides another reason to transfer your money using our facilities. Our
pay orders are a
secure and easy way to move your money from one place to another. And, as
usual, our
charges for this service are extremely competitive.
TRAVELER'S CHEQUES:
Negotiability: Pak Rupees Traveler’s Cheques are a negotiable
instrument.
Validity: There is no restriction on the period of validity.
Availability: At 700 branches of NBP all over the country.
Encashment: At all 400 branches of NBP.
Limitation: No limit on purchase.
Safety: NBP Traveler’s Cheques are the safest way to carry our money.
LETTER OF CREDIT:
NBP is committed to offering its business customers the widest range
of options in the
area of money transfer. If you are a commercial enterprise then our
Letter of Credit
service is just what you are looking for. With competitive rates,
security, and ease of
transaction, NBP Letters of Credit are the best way to do your business
transactions.
16
COMMERCIAL FINANCE:
Let us help make your dreams become a reality. Our dedicated team of
professionals
truly understands the needs of professionals, agriculturists, large and
small business
and other segments of the economy. They are the customer’s best
resource in making
NBP’s products and services work for them.
FOREIGN REMITTANCES:
To facilitate its customers in the area of Home Remittances, National
Bank of
Pakistan has taken a number of measures to:
Increase home remittances through the banking system. Meet the SBP
directives/instructions for timely and prompt delivery of remittances to
the
beneficiaries
New Features:
The existing system of home remittances has been
revised/significantly improved and
well-trained field functionaries are posted to provide efficient and
reliable home
remittance services to nonresident Pakistanis at 15 overseas branches
of the Bank
besides United National Bank (the joint venture between NBP and UBL
in UK)., and
Bank Al-Jazira, Saudi Arabia. Zero Tariff: NBP is providing home
remittance services
without any charges. Strict monitoring of the system is done to ensure
the highest
possible security.
Special courier services are hired for expeditious delivery of home
remittances to the
beneficiaries.
SWIFT SYSTEM:
The SWIFT system (Society for Worldwide Inter bank Financial
Telecommunication)
has been introduced for speedy services in the area of home
remittances. The system
has built-in features of computerized test keys, which eliminates the
manual
application of tests that often cause delay in the payment of home
remittances.
The SWIFT Center is operational at National Bank of Pakistan with a
universal access
number NBP-PKKA. All NBP overseas branches and overseas
correspondents (over
450) are drawing remittances through SWIFT.
Using the NBP network of branches, you can safely and speedily
transfer money for
our business and personal needs.
TRADE FINANCES OTHER BUSINESS LOANS:
AGRICULTURAL FINANCE:
NBP provides Agricultural Finance to solidify faith, commitment and
pride of farmers
who produce some of the best agricultural products in the World.
Agricultural Finance Services:
17
“I Feed the World” program, a new product, is introduced by NBP with
the aim to
help farmers maximize the per acre production with minimum of
required input.
Select farms will be made role models for other farms and farmers to
follow, thus
helping farmers across Pakistan to increase production.
Agricultural Credit:
The agricultural financing strategy of NBP is aimed at three main
objectives:-
Providing reliable infrastructure for agricultural customers
Help farmers utilize funds efficiently to further develop and achieve
better production
Provide farmers an integrated package of credit with supplies of
essential inputs,
technical knowledge, and supervision of farming.
Agricultural Credit (Medium Term):
Production and development:
Watercourse improvement
Wells
Farm power
Development loans for tea plantation
Fencing
Solar energy
Equipment for sprinklers
Farm Credit:
NBP also provides the following subsidized with ranges of 3 months to
1 year on a
renewal basis.
Operating loans
Land improvement loans
Equipment loans for purchase of tractors, farm implements or any
other equipment
Livestock loans for the purchase, care, and feeding of livestock
Production Loans:
Production loans are meant for basic inputs of the farm and are short
term in nature.
Seeds, fertilizers, sprayers, etc are all covered under this scheme.
If you require any further information, please do not hesitate to e-mail
us.
CORPORATE FINANCE:
Working Capital and Short Term Loans:
NBP specializes in providing Project Finance – Export Refinance to
exporters – Preshipment
and Post-shipment financing to exporters – Running finance – Cash
Finance
– Small Finance – Discounting & Bills Purchased – Export Bills
Purchased / Preshipment
/ Post Shipment Agricultural Production Loans
Medium term loans and Capital Expenditure Financing:
NBP provides financing for its clients’ capital expenditure and other
long-term
investment needs. By sharing the risk associated with such long-term
investments,
18
NBP expedites clients’ attempt to upgrade and expand their operation
thereby making
possible the fulfillment of our clients’ vision. This type of long term
financing proves
the bank’s belief in its client's capabilities, and its commitment to the
country.
Loan Structuring and Syndication:
National Bank’s leadership in loan syndicating stems from ability to
forge strong
relationships not only with borrowers but also with bank investors.
Because we
understand our syndicate partners’ asset criteria, we help borrowers
meet substantial
financing needs by enabling them to reach the banks most interested
in lending to
their particular industry, geographic location and structure through
syndicated debt
offerings. Our syndication capabilities are complemented by our own
capital strength
and by industry teams, who bring specialized knowledge to the
structure of a
transaction.
Cash Management Services:
With National Bank’s Cash Management Services (in process of being
set up), the
customer’s sales collection will be channeled through vast network of
NBP branched
spread across the country. This will enable the customer to manage
their company’s
total financial position right from your desktop computer. They will also
be able to
take advantage of our outstanding range of payment, ejection, liquidity
and
investment services. In fact, with NBP, you’ll be provided everything,
which takes to
manage your cash flow more accurately.
SHORT TERM INVESTMENTS:
NBP now offers excellent rates of profit on all it’s short term investment
accounts. Whether
you are looking to invest for 3 months or 1 year, NBP’s rates of profit are
extremely
attractive, along with the security and service only NBP can provide.
EQUITY INVESTMENTS:
NBP has accelerated its activities in the stock market to improve its
economic base
and restore investor confidence. The bank is now regarded as the most
active and
dominant player in the development of the stock market. NBP is
involved in the
following:
Investment into the capital market
Introduction of capital market accounts (under process)
NBP’s involvement in capital markets is expected to increase its
earnings, which
would result in better returns offered to account holders.
19
Competitors
Competitors of National Bank of Pakistan are all scheduled banks,
which are
listed/trading under Banking Companies Ordinance 1962.
Competitive Banks are as under:
• Habib Bank Limited
• United Bank Limited
• Muslim Commercial Bank Limited
• Allied Bank Limited
• Askari Commercial Bank Limited
• Soneri Bank Limited
• Bank Al-Habib Limited
• Bank Al-Falah Limited.
• Standard Chartered Bank Limited & The Bank of Punjab
Organizational structure
Organizational Hierarchy Chart
20
PRESIDENT
DIRECTORS / SEVPS
Provisional Chiefs / EVP
Regional Chiefs / EVP
Zonal Chiefs / SVP
Voice President
Assistant Voice President
Officer Grad I, II, III
Clerical / Non-Clerical Staff

Span of Control
Span of control is the number of subordinates who report directly to a
specific
manager.
There are three types of branch categories i.e. I, II, & III in National
Bank of Pakistan.
Category I Branches: Four employees report to their branch
manager.
Category II Branches: Eleven employees report to their branch
manager.
Category III Branches: Fifteen employees report to their branch
manager.
At branches level there is broader span of control but due to tall
structure of the
organization we find narrow span of control in the bank.
Number of employees
Description 2002 2003 2004 2005 2006 2007
Total Employees 12195 13272 13745 13824 14019 15019
Main Offices
Audit Committee
Chairman Azam Faruque
Ibrar A. Mumtaz
Mian Kausar Hameed
Auditors
Chartered Accountants Ford Rhodes Sidat Hyder & Co.
Chartered Accountants M. Yousaf Adil Saleem & Co.
Legal Advisors
Advocates & Legal Consultants Mandviwala & Zafar
Registered & Head Office
NBP Building
I.I. Chundrigar Road, Karachi
Pakistan
Registrars & Share Registration Office
THK Associates (Pvt.) Limited
Shares Department, Ground Floor,
Modern Motors House,
Beaumont Road,
Karachi, Pakistan
22
Website
www.nbp.com.pk
Branches
National Level
Description 2002 2003 2004 2005 2006
Total Branches 1204 1199 1226 1242 1250
International Level
15 Branches
Plan of your internship program
Introduction of Branch
Name of Branch National Bank of Pakistan,
Main Branch Mailsi Distt.Vehari.
Branch Code 0497
Region Multan
Region Code 08
Address Quaid-e-Azam Road Mailsi
Tehsil Mailsi District Vehari.
Phone No. 067-410318, 067-411918
Fax No. 067-410318
Name of Manager Rana Muhammad Anwer
Name of My Supervisor Ch. Ikram Ullah
Number of employees 12
Starting and ending dates of internship
Starting Date 25-12-2007
Ending Date 24.02.2008.
23
Departments of Training
During the internship period of 8 weeks I got training in various
departments in the
branch. A brief introduction of these departments is as under:
 Deposit of Current and PLS Saving Accounts & Account Opening (2
Weeks)
 Remittances and Bills (2 Weeks)
 Govt. Payments and Receipts (2 Weeks)
 Advances (2 Weeks)
Training program
Introduction of all the departments
There are many different departments in National Bank of Pakistan:
i) Deposit
Customers keep their savings in PLS Saving Accounts and businessmen
save their
money in bank Current Accounts. NBP gives profit on saving accounts
and special
saving accounts i.e. Premium Saving Accounts and NBP Premium
Amadni
Certificates for one to five year’s period.
ii) Advances (Credit department)
NBP give loans to the borrowers for different purposes. These loans are
given for
various sectors for different periods. Small Finance, Cash Finance,
Agriculture
Finance, Cash & Gold Loan, Personal Loans, Demand Finance, Running
Finance,
Corporate Finance, Export Import Financing, House Building Finance
(Saiban) and
NBP Karobar Scheme etc.
iii) Government Payments
National Bank of Pakistan is functioning as an agent of SBP. All types of
Government
Payment i.e. Pension, Salaries, Grants, Zakat, Benevolent Fund,
Treasury Refund and
Taxes Refund proceed through the bank.
iv) Government Receipts
In this department all types of Government receipts i.e. Revenues,
Taxes, Abyana,
Agriculture Tax, Government Fees, EOBI Funds and Utility Bills are
deposited. This
way NBP is serving great job of revenue collection.
24
v) Remittances
Another important department in the bank is remittances. People send
their money to
the other persons and organizations through various way i.e. Bank
draft, Telegraphic
Transfer, Mail Transfer, Coupons, Govt. Draft and Western Union
Money Transfer
etc. It works both inward and outward.
vi) Bills
Customers collect their money/amount through bills. They present
their cheques,
drafts and other bills for collection within the city and out of the city
through mail.
Now a days Online Banking is becoming more popular for this purpose
but the branch
where I got training is still not have this facility.
vii) Cash Department
National bank deals Government treasury on behalf of State Bank of
Pakistan. There
are Chest, Sub-chest and Non-chest branches in the bank. SBP supplies
currency
notes to the bank and monitors its cash flow. Cash In charge and other
cashiers deal
with cash receipt and payment in the bank.
viii) Compliance
Role of branch compliance department is to reconcile the prescribed
frequencies,
investigate long pending reconciliation item, and ensure correct
treatment every halfyear
and clearing system service branch-in major cities. Internal control is
the
integration of the activities, plans, attitudes, policies and efforts of the
people of the
bank working together to provide reasonable assurance that the
organization will
achieve its objectives and mission.
ix) Agriculture Department
Agriculture Credit Department is playing a vital role in development
the economy of
Pakistan. Commercial banks being the greatest mobilizer of savings in
the country
with their large network of branches play important role in financing
agriculture. The
National Bank of Pakistan has also been trying to ensure that loans are
disbursed to
genuine agriculturists within a reasonable time and that the bank turns
down no viable
loan request.
ix) Human Resources Management
Human Resources Management Department works for the betterment
of the
employees. Enhances skills, training management, service benefits,
wages, medical
facilities, staff loans are basic functions of this department.
x) Information Technology Department
Bank’s data collection and information system run by Regional Data
Collection
Center. This department manages staff training programs regarding
computer.
25
xi) Online Banking
This department is functioning only in online branches in the bank. This
is a fast track
banking system in modern banking. NBP is also trying to enhance this
facility for
their customers.
xi) Retail & Commercial
This is the department that boosts the profitability of the bank.
National Bank
becomes the largest profit-earning bank of the country by introducing
personal loans
i.e. NBP Advance Salary Scheme and Saiban Scheme.
xii) FBR Collection Department
NBP is playing great role for collection of FBR (CBR) taxes/revenue. A
separate
counter is established at branch level to facilitate the taxpayers.
xiv) Islamic Banking
The year 2007 marked the first year of Islamic banking operations.
During the
year under review, in addition to active participation in various Sukuk
transactions,
two more Islamic banking branches at Lahore and Peshawar started
operations.
NBP’s plans for the year 2008 include opening of Faisalabad and
Rawalpindi branches
with the focus on growing organically by opening more standalone
Islamic banking
branches, utilizing NBP’s existing branch network of 1,200 plus
conventional
branches and looking into strategic acquisitions for expansion in this
field
Detail of the Departments I Worked In
i) Deposit of Current and PLS Saving Accounts & Account
Opening:
All banks depend on deposits. It is a very important department where
customers
deposit and withdrawal their money. Banks use this money for loaning
on higher rate
to earn profit.
Account opening is also very vital now a days in banking system due to
KYC (Know
your customer) , AML (Anti Money Laundering) and ATF (Anti terrorist
financing)
because ANL has become a global problem and all the countries of the
world are
vulnerable to it.
I got training in this department for two weeks and after understand
the basic concept
I practically opened account of walk-in-customers.
ii) Remittances and Bills
26
Another important department in the bank is remittances and Bills for
Collection.
People send their money to the other persons and organizations
through various way
i.e. Bank draft, Telegraphic Transfer, Mail Transfer, Coupons, Govt.
Draft and
Western Union Money Transfer etc. It works both inward and outward.
Customers collect their money/amount through bills. They present
their cheques,
drafts and other bills for collection within the city and out of the city
through mail.
Now a days Online Banking is becoming more popular for this purpose
but the branch
where I got training is still not have this facility.
iii) Government receipt and Payment
In this department all types of Government receipts i.e. Revenues,
Taxes, Abyana,
Agriculture Tax, Government Fees, EOBI Funds and Utility Bills are
deposited. This
way NBP is serving great job of revenue collection.
Another important department in the bank is remittances. People send
their money to
the other persons and organizations through various way i.e. Bank
draft, Telegraphic
Transfer, Mail Transfer, Coupons, Govt. Draft and Western Union
Money Transfer
etc. It works both inward and outward.
iv) Credit Department
NBP give loans to the borrowers for different purposes. These loans are
given for
various sectors for different periods. Small Finance, Cash Finance,
Agriculture
Finance, Cash & Gold Loan, Personal Loans, Demand Finance, Running
Finance,
Corporate Finance, Export Import Financing, House Building Finance
(Saiban) and
NBP Karobar Scheme etc. The National Bank of Pakistan has also been
trying to
ensure that loans are disbursed to genuine agriculturists within a
reasonable time and
that the bank turns down no viable loan request.
Retail and Commercial wing enhanced the profitability of the bank.
National Bank
became the largest profit-earning bank of the country by introducing
personal loans
i.e. NBP Advance Salary Scheme and Saiban Scheme.
27
Structure of Finance Department
Department Hierarchy
Numbers of Employee
Total No. of Employees are 02 in Finance Department
Finance and Accounting Operations
Finance and Accounting operations are operated with the help of
subordinate staff. Bank is financing in multiple sectors.
Functions of the Finance Department
Finance Department performs following functions.
 Borrowing from State Bank of Pakistan.
 Lending to Commercial Banks
 Lending to Investors.
 Lending to General Public for multi-business.
Accounting system of the organization
Accounting system of the bank especially where I done internship is
very bad due to
non-availability of Information Technology trained staff which is most
requirement of
the bank. Bank use manually accounting system during its operational
activities.
Finance system of the organization
Financial system of the bank where I done my internship is mixed and
complicated
because being government bank, bank deals with all kind of lending
and investing
activities and also hold down the cash position of others financial
institutions i.e. banks
like MCB, UBL, ABL etc.
Use of electronic data in decision-making
There is lack of use of electronic data in decision making being a
operational branch of
the bank all the decisions make by higher offices i.e. Regional Office or
Head Office and
this branch only act upon on the order received from high command.
28
Finance Director
Accounts Officer
Assistant Accounts Officer
Mobilization of funds.
The branch where I have got training, is mobilizing his fund through
lending or
receiving only. Branch provides various kind of lending facilities all kind
of as stated
above in product line.
Generation of funds
Fund generation of the branch is depositing, receiving interest on
lending money to
various sectors, advances from other financial institutions.
Sources of funds
Fund generation of the branch is depositing, receiving interest on
lending money to
various sectors, advances from other financial institutions.
Allocation of funds
Bank allocates funds according to the instructions of the high
command.
Critical analysis
Financial Analysis
Pre tax profit stood at Rs. 12,674 million from Rs. 14,002 million of
corresponding
period of last year, a reduction of 9.5%. Bank’s operating performance
have been
quite impressive, operating revenue increased by 30% from Rs. 20376
million to
Rs.26,497 million, while pre provision profit increased by Rs. 4,293
million an
increase of 31.4%. Diluted earning per share declined to Rs. 8.79 from
Rs. 10.05
during the same period of last year. Pre tax return on equity stands at
35.8% whereas
Pre tax return on assets is at 3.3%. Cost to income ratio of the bank
remained in the
top tier at 0.32
Net interest margin registered an impressive growth of Rs. 2,670
million or 16.4%
mainly due to growth in volumes. Net advances increased by Rs. 41
billion and Rs. 32
billion as compared to corresponding period of last year and year end
2007. The
growth in advances mainly emanated from corporate and commodity
financing.
Deposits show impressive growth of Rs. 68 billion or 12.3% over
corresponding
period last year. Compared to year end December 2007 the deposits
have increased by
Rs. 29 billion or 5% mainly due to our marketing efforts and the trust
that customers
have in NBP.
Non interest base income has shown an impressive increase of Rs. 3.4
billion or 84%
over corresponding period due to higher commission, exchange
income and a one off
receipt of Rs. 977.8 million as compensation for delayed tax refunds.
The
compensation on delayed refunds pertains to various assessment
years from 1991-92
to 2001-02.
Administrative expenses show a rise of Rs. 1,828 million or 27%
compare to
corresponding period mainly due to inflation and salary increases.
Going forward we
expect that with the technological / human resource up gradation
program our costs
29
will rise in short term however we need to invest today for better
returns in the future.
Provision charge against advances for the corresponding period last
year includes a)
one off items of Rs. 1.4billion on account of one large cash recovery
and reversal in
general provision of Rs. 825 million due to reduction in provision
requirement on
advance salary from 5% to 3%. If we exclude these one offs the
provision charge last
year comes to Rs. 1.8 billion. Further b) last year the SBP changed its
prudential
regulations and withdrew the benefit of Forced Sales Value in the third
quarter of last
year, therefore this year the banks can no longer take the benefit of
forced sales value
of the collateral securities. The additional provision charge on account
of withdrawal
of FSV impact last year was Rs. 3.1 billion, which was made in the 3rd
and 4th
quarter of last year. This benefit of Rs 3.1 billion was being carried in
the first half of
2007. Therefore the comparison between the provisions for the two
periods should
take into account both these factors. Additionally the bank is making
all out efforts for
recovery of non-performing loans and aggressive targets have been
assigned to the
units.
We extend our appreciation to the bank’s staff for their commitment,
dedication and
hard work in achieving these excellent results. We would like to
express our
appreciation to our stakeholders, regulators and our valued customers
for their support
and continued confidence in NBP.

Ratio Analysis
Net Profit Margin:
This ratio measures the firm’s profitability of sales/ interest earned
after taking
account of all expenses and income taxes. This ratio can be calculated
as:
Net profit margin ration = Net Profit after taxes / interest earned
Net Profit Ratio
2005 2006 2007
12709/33634 X 100
37.78%
17255/44014 X 100
39.20%
19037/50569 X 100
37.64%
Explanation: from the calculation it is very much clear that the
performance of NBP is
very good. And the trend is upward. It tells us a firm’s net income per
rupee of
revenue. As the trend is upward it shows the high profits in revenue
per rupee in case
of NBP. It is because of high advances the NBP has given to the people.
Return on Equity:
Dividing profit after taxation by shareholder’s equity. ROE compares
net profit after
taxes to the Shareholder’s Equity.
This ratio is calculated as:
ROE=Profit after taxes/Share holder’s Equity
31
ROE
2005 2006 2007
12709/36158 X 100
35.14%
17255/53045 X 100
32.53%
19037/69271 X 100
27.48%
Return On Assets:
This ratio shows the efficiency of organization that how efficiently
utilizes their
assets. This ratio relates profits to assets.
It is calculated as: ROA = Profit after Tax/Total Assets
ROA
2005 2006 2007
12709/577719 X 100
2.19%
17255/635133 X 100
2.71%
19037/762194 X 100
2.49%
From calculation it is clear that this ration of NBP is increasing. It shows
that NBP
using it’s assets very efficiently. That is why they are earning very high
profits. This
shows that how efficiently they investing the assets that’s why they
are earning high
profits.
Investment deposit Ratio:
This ratio shows the comparison of investments and deposits. This is
calculated as.
Investment deposit Ratio=Investment/deposits
Return on
Investment
2005 2006 2007
156986/463427 X 100
33.87%
139947/501872 X 100
27.88%
210788/591907 X 100
35.61%
Advances deposit Ratio:
This ratio show that how much efficiently the bank advances the
deposits of their
customer to borrower.
It is calculated as.
Advances deposit ratio = Advances/ deposit
32
Advances
Deposit
Ratio
2005 2006 2007
268839/463427 X 100
58.01%
316110/501872 X 100
62.98%
340677/591907 X 100
57.56%
From above table it is clear that the ratio is going high. Which means
the efficiency on
NBP is good and they use their deposits efficiently in advancing to
borrowers. Here
high ratio is required. The next side of the picture is that the people
will think that is
risky to deposit the money in the bank.
33
SWOT Analysis of the organization
Strength
• Declared World’s best Foreign Exchange bank in 2008
• Stable AAA/A-1+ (Tipple A/a-One Plus) rated bank
• Best Return on Capital Bank for 2006 amongst all the banks in Asia
• Highest Profitability bank of Pakistan
• 10 the Best Bank in terms of ‘ Profit on Capital’ in the world
• Having Highest Assets and Capital in Pakistan
• Functioning as an agent of State Bank of Pakistan
• Dealing Government Treasury where SBP has not its own branch
• Having unshakable trust of the public and its stakeholders
• Giving Loans alone in the market against Gold Ornaments
• Performing social responsibilities and claiming “The Nation’s Bank”
• Disbursing Salaries and Pensions to the Government employees and
earning
high profit on NBP-Advance Salary Loan Scheme
• Earning commission from SBP on Government transaction
• Facing never problem of cash/currency being its Chest and Sub-chest
Branches all over the country
• NBP have presence in the countries having sizeable trade volumes
with
Pakistan by its overseas operations
• Holds largest deposit base in the market share in terms of number of
accounts
• Leading bank in agriculture financing amongst commercial banks
with the
market share of 15%
• Helping in earning of foreign exchange, remittances and leading
agent of
Western Union Money Transfer
• SBP rated “Fair” for capital & human resources, “Strong” for assets,
“Fair” for
management and “Satisfactory” for both earning (Rs.24.1 for per
share) and
liquidity
Weakness
• Lowest Internal Control and Compliance System, SBP rated
“Marginal” which
is alarming for the Bank
• Unsatisfactory corporate culture of the Bank
• Physical environment and atmosphere compare to other banks is not
meet the
standard
• Less number of Online Branches
• Ineffectively use of technologies i.e. Information technology
• Shortage of staff- per employee customer is very high side
• Technical education and training of staff is insufficient
34
Opportunities
• Being a Government Bank NBP having wide scope in economic
market.
• Trust and reliability creates chances to enhance deposit and
profitability.
• Its vast network of domestic and overseas branches can help to
expand
business.
• Bank’s deposit is increasing rapidly so there is a great opportunity to
enhance
its investment and financing.
• Being an agent of State Bank of Pakistan it can play vital role in local
economy.
• Earning commission/exchange on Government transactions.
Threats
• SBP penalties due to low internal control and compliance.
• Government, SBP and Prudential Rules and Regulations.
• Schedule banks and Multinational/International bank’s profit rates.
• Its staff switching over to other private banks due to more facilities.
• Other bank’s charming atmosphere and relaxation in documentation.
• SBP rated just “Marginal” in respect of System & Control which is
alarming
for the Bank to survive its license.
• NBP staff code of ethics and practices.
• High number of complaints regarding staff behavior.
• Government Schemes, Government Revenue Collection,
Government.
• Payments and FBR Collections create heavy workload.
35
Conclusion & recommendations
• In my opinion the process of a transaction should be short in order in
save
time for both customers and the bank.
• Staff strength should be enhanced and professional qualified persons
should be
recruited.
• It is recommended that proper training be provided to the staff
members that
will ultimately increase the performance of Bank over all.
• It is suggested that promotion be given to the staff in due time and
on the basis
of performance to provide job satisfaction.
• The bank should spend more on renovation of the branches to
improve
environment and atmosphere to attract the customers.
• Sitting arrangement, air conditioning and new furniture should be
facilitated
• The Bank should introduce the computers software to cope the heavy
load of
work and better control.
• Extra counters should be established in order to facilitate during the
rush days
the difficulties faced by the bank staff as well as the customers.
• All Branches of the Bank must be online.
• All the departments should be established separately.
• Bank can increase its profit ratio by reducing extra expenditures and
to enhance
the volume of advanced especially retail loans.
• I done internship, I recommend that security level in the bank should
be
enhanced especially where I got internship and operation of Mobile
phones must
not be allowed inside the Bank.
• Bank should take step to establish separate counters for the old age
employees
and pensioners.
• The Bank should locate new market for its operational activities in
the country as
well as abroad.
• The Bank should increase profit rate on deposits and saving schemes
especially for pensioners and old age citizens.
• For improvement of internal control and system the compliance wing
and
surprise inspection system should work more effectively.
• To avoid complaints and leaving the bank job number of staff should
be
enhanced and their salaries should be leveled to the
private/multinational
banks.
• Double shift system should be introduced to improve attitude and
behavior of
the employees.
• Payment of salaries and pensions should be made separately to
accommodate
the valued customers and depositors.
• For collection of utility bills i.e. Electricity bills, Telephone bills, Water
and
Gas bills separate cash receipt counter must be established.
• Procedure of receiving loans should be easy and short time to
facilitate the
borrowers and enhance the profitability of the Bank.
36
References
1. Website of the Bank i.e. www.nbp.com.pk
2. Economic Bulletin, Vol. 34, No.5 September – October 2007,
published
bi-monthly by Economic Research Wing, National Bank of Pakistan.
3. Economic Bulletin, March-June 2008, published bi-monthly by
Economic Research Wing, National Bank of Pakistan.
4. NBP News lines, National Bank of Pakistan’s Newsletter January
2008.
5. NBP News lines, National Bank of Pakistan’s Newsletter May/June,
2008.
6. NBP News lines, National Bank of Pakistan’s Newsletter July/August,
2008.
7. NBP News lines, National Bank of Pakistan’s Newsletter
September/October, 2008.
8. Management Brief, January 2008 published by Human Resources
Management and administration Group, National Bank of Pakistan
Head
Office Karachi.
9. Management Brief, March 2008 published by Human Resources
Management and administration Group, National Bank of Pakistan
Head Office Karachi.
10. Management Brief, June 2008 published by Human Resources
Management and administration Group, National Bank of Pakistan
Head Office Karachi.
11. Management Brief, August, 2008 published by Human Resources
Management and administration Group, National Bank of Pakistan
Head Office Karachi.
12. Financials-Half Yearly Account June 30, 2008.
13. Economic Indicators Pakistan, January 2008 published by Economic
Research Wing, Credit Management Group, NBP Head Office Karachi.
14. Annual Report 2007, published by NBP, Head Office Karachi.
15. Brochure- NBP Awards & Achievements.
16. Brochure- NBP Kisan Dost.
Annexes
37
• Brochure- NBP Awards & Achievements.
• Brochure- NBP Kisan Dost.
38