Chapter -1

Introduction

1.1 BACKGROUND OF THE STUDY

A bank is an institution, which deals with money and credit. It accepts deposits
from public, makes the fund available to those who need them and helps in the
remittance of money from one place to another.
We have seen branches of banks in town and villages offering various types of
services. In the past, they used to accept just deposit from the public (savers) and give
loans to public (users). With the passage of time, their functions have increased
manifold. Now some of the banking functions are carried out by other financial
institutions as well. The bank offers interest for accepting deposits and charges
interest for lending the loans. The difference between the interest rate is the bank’s
profit.
In the current era and economy the bank has played a significant role. The bank
helps commercial sectors (trade and industry), individuals and many other sectors by
accepting deposits, lending and by providing many other important services.
The origin of the ‘bank’ is linked to Italian word ‘banco’, Latin word ‘bancus’
and French word ‘banque’ which all mean bench. ‘Bank of Venice (1157 A.D.)’ was
the first step towards the institutional development of banking in the history of the
bank. It is regarded as the first modern bank. Subsequently, ‘Bank of Barcelona
(1401 A.D.)’ and ‘Bank of Geneva (A.D)’ were established. Thereafter ‘Bank of
Amsterdam (1609 A.D)’ in Holland and ‘Bank of Hamburg (1619 A.D.) in
Germany were established. The Bank of Hindustan was established in 1770 A.D. is
regarded as the first bank of India.

1
 These modern banks gradually replaced goldsmiths and money lenders in
Europe. Though, Bank of England was established in 1649 A.D., the growth of bank
accelerated only after the introduction of Banking Act-1833 in United Kingdom as it
allowed opening Joint Stock Company banks.
Tejarath Adda established during the tenure of Prime Minister Ranoddip
Singh in 1933 was the first step towards institutional development banking of Nepal.
Tejarath Adda did not collect deposit from the public but gave loans to employees and
public against the bullion (gold) in the term of five percent interest.
Banking in the true sense of term started with the commencement of Nepal
Bank Limited (NBL) on 30th Kartik 1994 B.S as a semi-government organization
under Nepal Bank Law 1994 B.S. Right from inception, it carried out functions of
commercial bank.
Having felt the need of development of banking sector and to help the
government formulate monetary policies, Nepal Rastra Bank (NRB) was set up in
14th Baisakh 2013 B.S. under the Nepal Rastra Bank Act 2012. Since then, it has been
functioning as the government’s bank and has contributed to the growth of financial
sector. Though NRB has, at present, adopted a deregulatory approach, it requires
continuous modification in view of fast changing world.
Integrated and speedy development of the country is possible only when
competitive banking service reaches nooks and corners of the country. Being the
central bank, NRB has its own limitation and reluctance of NBL to go un-profitable
sectors/areas was not illogical. To cope with these difficulties, government set up
Rastriya Banijya Bank (RBB) in 2022 B.S. as a fully owned commercial Bank.
With the coming of NBB, banking service spread to both the urban and rural
areas but, customers failed to have the taste of quality and competitive service
because of excessive political and bureaucratic interference and absence of modern
managerial concept. As the name suggests, commercial banks had to carry out
commercial transactions only. But commercial banks had to carry out the functions of

2
development bank which they are doing today. Despite being an agriculture country,
our farming system is the traditional one that consumes more cost and less yield. To
get rid of this problem scientific agriculture system is imperative, which requires
finance and specialist of the field. To meet these ends, Agriculture Development
Bank (ADB) was established in 2024 B.S.
Thereafter the liberal economic policy of the government causes the
commencement of various banks in joint venture such as Nepal Arab Bank Limited
(NABIL-2041 B.S.), Nepal Indosuez Bank (2042 B.S.), Nepal Grindlays Bank (2042
B.S.), Himalayan Bank Limited (2049 B.S.), Nepal S.B.I Bank Limited (2050 B.S.),
Nepal Bangladesh Bank (2051 B.S.), Everest Bank (2051 B.S.), Bank of Kathmandu
(2051 B.S.), Nepal Bank of Ceylon (2052 B.S.).

1.2 HISTORICAL DEVELOPMENT OF BOK

A bank is an institution, whose principal operations are concerned with the

accumulation of the temporarily idle money of the general public for the purpose of
advancing to other for expenditure. Bank accepts deposits and lends to others. It
charges interest on loans and gives interest on deposits and the difference between
these two it its profit. Bank generally charges higher rate of interest on loans provided
by it than the interest it gives on deposits.
Reforms were introduced with the changes in the commercial bank act of 1974
and its amendments in 1984. The entry barriers placed on commercial banks were
eliminated. This change was introduced to allow both foreign banks and the private
sector to operate in the banking sector. However, foreign participation in the financial
sector is only allowed with the joint collaboration with the domestic promoters. The
objective to help transmit banking, managerial, and technical knowledge in the

3
economy. The immediate impact was on the number of joint venture commercial
banks that came following the remove of the entry barriers.
Following the restoration of the democracy in the early 1990’s the popularly
elected government accelerated the pace of economic reforms. Consequently, a
number of joint venture commercial banks came up in the private sector. Following
the opening up of banking sector, foreign capital in the form of share participation has
come from Bangladesh, New Zealand, France, Pakistan, India and Sri Lanka. Foreign
capital coming in this form however, totals a meager amount of US dollar 10.5
million. With the setting up these banks, the scope for the money market particularly
credit market has expanded. The public has at least a choice, with respect to doing
business in terms of commercial banks.
BOK was established in Falgun 28, 2051, in which general public had 25%,
Nepalese investor had 45% and Siam commercial bank of Thailand had 30% share.
This share structure has now been changed and financial institutions holds 1.92%,
organized institutions holds 0.35% and general public and promoters of Nepal hold
97.73% share.
BOK is committed to providing products and services of the highest standards to
its customers by understanding their requirements best suiting the market needs. In
pursuit to deliver the products and services of the highest standards, BOK has state-
of-art technology for appropriate and efficient Management Information System
(MIS) and rendering quality services, VSAT and Radio Modem for networking,
SWIFT for international trade and transfer of funds around the world, correspondent
banking relationships with over 200 banks worldwide for effective and proficient
execution of international trade and remittance activities, gamut of corporate and
retail banking products and services and centralized banking operations for better risk
management, consistent services deliveries and lowering operating cost.
Since its inception, it has been successful in satisfying customers providing
time relative services. Despite of unfavorable situation, it has been successful in

4
increasing its gross profit and net profit by 17.65% & 9.38% respectively in the fiscal
year 2064\65. Increase in the return on total assets has been 5.97% in the same fiscal
year.
BOK had introduced ‘Sajilo Bachat’ targeting middle class and people with
limited income. This deposit is less expensive, and therefore has less economic
burden on the bank.

1.2.1MANAGEMENT TEAM OF BOK

Young, seasoned and talented bankers, each with years of banking experience and
proven competency, constitute the Management Team of BOK which is as below .

Table 1.1
Mr. Radhesh Pant Managing Director

Mr. Ajay Shrestha Chief Operating Officer

Mr. Moti Kazi Tuladhar
Mr. Mahesh Mishra
Mr. Chetan B.S. Thapa
Mr. Kundan Sharma
Mr. Anand Pandey
Mr.Shiva Gurung
Mr. Suresh Man Singh
Mr. Kiran Bohara
Mr.Manish Singh
Mr.Dibya Chandra Shrestha
Mr. Ram Pratap Yadav
Mr. Binod N. Shrestha
Mr. Binam Raj Ghimire
1.2.2 ORGANIZATIONAL STRUCTURE OF BOK
Chief Marketing Officer
Head – Central Operation
Head – Retail Loan
Head – Corporate Banking
Head – Business Banking
Head – International Trade &Banking
Head – Central Logistic
Head – Credit Control
Head – Treasury & Corporate Finance
Head – Internal audit & Compliance
Head – Institutional Banking
Head – Corporate Communications & Business Development
Head – Cards & Technology

BOK has got independent and self-governing board, involving a pool of

endowed and farsighted directors. Each director of the board has been recognized and

5
well-acclaimed for his/her contribution in the development and growth of Bank of
Kathmandu. The board of directors of BOK is as below:-

Table 1.2

Mr. Alok Singh Chairman

Mr. Radhesh Pant Managing Director
Mr. Sanjay Bahadur Shah Director
Mrs. Rita Malla Director
Mr. Sita Ram Thapalia Director

1.2.3 BRANCHES AND STAFFS OF BOK

Since this fiscal year 2067/68 this bank has branches at Kamalpokhari, Thamel,
New Road, Hetatuda, Pokhara, Butwal, Nepalgunj, Dhangdhi and
Biratnagar,Baneshwor, Chabahial, Balaju, gangaubu etc.
The bank has 671 staffs in total till this fiscal year out of which 325 staffs are
permanent.

1.2.4 RECENT SERVICES PROVIDED BY BOK

Under the concept of 24 hour banking, ATM facility has been provided.
ATM facility is available at branches: Kamalpokhari, New Road, Thamel, and
Pokhara and ,Dhangadhi, Baneshwor, Butbal, Ramshah path, etc customers can use

6
the same card making payments at POS (Point Of Scale). It has made provision of
making payment of mobile bills, taking help of Nepal Telecom.
It has been converting BANCS2000 software, which is considered backbone of
bank into FINACLE software, which will provide sophisticated facilities and
productions. It has also started ‘Festivity Loan’ for various festivals such as
marriages, sacred thread ceremony (bratbandha) etc for conducting family and social
activities.

1.2.5 OPERATIONAL ACTIVITIES

Despite of adverse situation, bank has managed all expenses and as per Nepal
Rastra Bank’s direction. It has deposited 10% of current in capital adjustment fund,
which reaches total of 30%. That will be distributed among shareholders as additional
shares. Bank will make payment of 15% cash dividend in the current year. In
aggregate, bank is able to yield 30% profit in shareholders’ investment, which is
substantial in the current business situation.
Bank has been providing loans to the people who want to go abroad in search
of employment, which leads to increase in the foreign remittance. BOK has made
remittance agreements with the agencies like Money Gram, Int’l Money Exchange,
Krishi Premura, Xpress Money Service, First Remitt, Placid Express and Al- Fardan
Money Exchange, which played significant role in providing facilities in this regard.
In this fiscal year the remittance increases by 30% in comparison of last fiscal year
.This bank is independent in mobilizing necessary foreign remittance. In case of
excess of foreign currency than necessary, it has made provision of selling the excess
currency to others banks and Nepal Rastra Bank. In the current fiscal year it is able to
achieve Rs.7.21 crore exchange gain, which increases by 12.59% than last fiscal
year’s. This bank has established a Recovery Cell to follow up and control the non-
performing loan of the bank regularly. And bank is able to recover Rs. 343 lakhs out

7
of total non-performing loan in the fiscal year 2064\65, which is 10.35% of the same.
BOK considers employees as the most valued assets and believes that ‘A company is
as good as its people’. The bank has team dedicated, young, experienced and proven
bankers.
The bank puts great emphasis on upgrading various skills of all its employees
by providing skillful training and satisfying them.
BOK has been constantly involved in various social activities. It is quite
conscious in using less electricity and reusing the papers internally. It has placed
waste paper bin in various place to help keeping the environment clean.
In the current FY employees of the bank-conducted rally for civic-
consciousness regarding HIV/AIDS and the funds thus generated will be provided for
the same purpose.
In the current FY employees of the bank conducted blood donation program
for needy people.

1.2.6 STATEMENT OF THE PROBLEM

Nepal is developing country. The earning of people in Nepal is very lower than
other country. People want to invest their few proportion of amount in suitable sector.
People have to bear risk but they should manage all activities to make it lesser than
profit. Nowadays, many banking institutions are mushrooming and people are
investing and struggling in the competitive market. They have to bear many types of
fluctuations.
Nowadays banking institutions are bearing many kinds of losses caused by
political negligence, weaknesses of staffs, robbery and absence of good management.
By which banking institutions are not running smoothly, suffering from loss and no
one are interested to develop it. So the investors want to know the financial position

8
of the banking institutions, its liquidity position, dividend policies, its services and
facilities and so on.
So, the mentioned are the main problems for banking and financial institutions.
Every one faces that kinds of problems in any time but depends upon their capacity to
digest. Therefore, I hope this report may help the depositors, demanders and others to
know the actual situation of liquidity position, dividend policies, its services and
facilities and deposit trend about the BOK.

1.2.7 OBJECTIVES OF THE STUDY

Any kind of study has its own objective or purpose. Without objective nothing
can be done. This fieldwork also has some objectives. So, the main objective of this
study is to analyze the financial position of the BOK as regard to cash flows. Some
specific objectives are as follows-
i) To analysis the financial position.
ii) To assess a bank’s ability to generate positive future cash flows.
iii) To be familiar with services and facilities provided by BOK

1.2.8 SIGNIFICANCE OF THE STUDY

The study is focused to analyze the financial position of BOK as regard to cash
flows are used to managerial decision as well decision about investment in BOK.

9
 This study is not only to fulfill the assignment report of BBS 3 rd year but also
to provide some knowledge about the BOK and its current cash flow situation. The
report is very much important for banks, as the suggestions and recommendations
provided by the students.

1.2.9 LIMITATIONS OF THE STUDY

Although this study helps the student to gain knowledge by writing report
practically, it has certain limitations. Due to limited time studying and analyzing data
is difficult task. Its limitations can be pointed as below:-
-The study is based on historical data of secondary nature.
-The study covers only the period 2065\66.
-The study can not cover all dimensions of the subject matter and resources due
to the short time period which limit the study of the researcher.

1.3 RESEARCH METHODOLOGY

1.3.1 RESEARCH DESIGN

Research methodology is the guideline of research. There are different

methodologies that can be applied to related facts and information related to all
aspects of anything. This research study attempts to analyze the financial position
of the BOK as regard to cash flows. This study also attempts to assess a company’s
ability to meet its obligations, its ability to pay dividends and ending cash balance.

1.3.2 SOURCES OF DATA

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The sources of data are basically of primary and secondary type. Data are gathered
through the annual report of the bank. The research is based on recent historical
data. Balance sheet and profit and loss A/C of the bank are used for this purpose of
analysis.

a) Primary Data

Primary data is the data which is generally collected by the investigator or researcher
directly by himself/herself. So primary data collection includes observation, survey and
questionnaires.

b) Secondary Data

Secondary data is the data which is already collected and used by someone. Secondary
data are the data that have been gathered not for the immediate study but for some other
purposes. Secondary data cam be obtained form either private or public sources. It
collected indirectly. The advantage of secondary data are that they are low in cost and do
not require much time to collect. However it has disadvantages such as the data may not
fit exactly as per requirement for the research problem as defined in the study.

11
 1.3.3 DATA COLLECTION PROCEDURE

Any type of study having small or large requires data. Data shouldn’t
hypothetical but it should have quality of accuracy and perfectibility. At the time of
study the researcher had performed these steps.
Firstly, topic has been selected and then bank is selected and concerned bank
had been visited to get required data for the purpose of report writing from the
concerned authorities. And website of the concerned bank had been visited as well.

1.3.4 DATA ANALYSIS TOOLS

Data from balance sheet and profit and loss account are used. Cash flow
analysis is done through statement of cash flows. Following techniques are used while
doing cash flow analysis.

(A) OPERATING ACTIVITIES

Operating activities relate to companies primary revenues generating activities.

Operating activities involve producing and delivering goods and providing services.
Cash flow from operating activities includes receipt from customers from sale of
goods and services. Cash outflows from operating activities includes payments to
purchase of materials and for services, payment to employees for services and
payment made to government for taxes and duties.

(B) INVESTING ACTIVITIES

Investing activities involve making and collecting loans and acquiring and
disposing of fixed assets. Cash inflows from investing activities are receipts from sale
of shares, debentures or similar instruments of other enterprise. Cash outflows under
12
investing activities are purchasing of shares and debentures of other enterprises,
purchase of fixed assets.

(C) FINANCING ACTIVITIES

Financing activities involve obtaining resources from owners and providing

them with a return in their investment, borrowing money and repaying amounts
borrowed. It also includes incoming cash by issue of shares and debentures, issue of
long term loans. Under outgoing of cash-redemption of preference share and
debenture, repayment of long term loan, payment of dividend, repayment of principal
with interest etc.

OUTLINE OF THE CHAPTER

The field work report has been divided into three chapters along with the references,
which are as follows:-
-The first chapter includes Introduction.
-The second chapter includes Data Presentation and Analysis
-The first chapter includes Summary and Conclusion

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 Chapter -2
Data Presentation & analysis

2.1 PRESENTATION AND ANALYSIS OF SECONDARY DATA

The profit and loss account of BOK is as follows:

Profit and loss account
As on 31st Asadh 067/68 B.S.
Dr. Table no.2. 1 Cr.
particulars Amount Particulars Amount
Interest 24,16,39,164 Interest 60,70,95,662
Employees expenses 5,38,22,309 Commission & discount 7,23,51,675
Office operation expenses 9,91,90,178 Exchange gain 7,21,14,868
Exchange loss - Non-operating income 49,496
Non-operating loss 5,18,267 Other income 44,67,286
Bad debt written of -
Provision of risk 13,39,16,898
Provision for staff bonus 2,26,99,217
Provision for income tax 6,47,63,233
Net profit 13,95,29,721

Total 75,60,78,988 Total 75,60,78,988

Source: Annual report of BOK 065/66

Balance sheet
14
 As on 31st Asadh 067/68 B.S.
Table No. 2.2
Capital & Last year Current year Assets Last year Current year
liabilities
Share Capital 46,35,80,900 46,35,80,900 Cash balance 13,92,20,903 16,14,69,654
Reserve funds 18,71,64,330 25,71,56,916 Bank balance 64,36,62,038 57,90,50,828
Outstanding loan 91,21,50,000 60,00,000 Money at call & 27,23,21,000 32,88,73,857
Deposits 7,74,16,45,424, 8,94,27,48,598 short notice
Bills payable 3,87,09,420 1,98,73,927 Investments 2,47,74,09,627 2,59,82,53,410
Other liabilities 15,30,94,598 16,77,70,123 Loan advances &
bills purchased 5,64,66,98,444 5,91,25,79,472
Fixed assets 8,36,25,007 9,52,30,942
Other assets 23,34,07,653 18,16,72,301

Total 9,49,63,44,672 9,85,71,30,464 Total 9,49,63,44,672 9,85,71,30,464

Source: Annual report of BOK 067/68

Balance sheet reveals the increase in cash balance, money at call and short notice,
investments, fixed assets and increase in loan, advances and bills purchased and
decrease in bank balance and other assets as well. Bank has not issued any shares so
share capital is the same. Reserves, deposit and other liabilities has been increased
while outstanding loan and bills payable has been decreased.
The cash flow statement of BOK is as follows:

15
 Cash flow statement of Bank of Kathmandu
As on 31st Asadh 067/68 B.S.
Table No. 2.3
Particulars Amount
Cash flow from operating activities:
Cash receipts
Interest income 60,70,95,662
Commission & discount income 7,23,51,675
Exchange gain 7,21,14,868
Non-operating income 49,496
Other income 44,67,286
75,60,78,987
a)Total cash receipts

Cash payments 24,16,39,164

Interest expenses 5,38,22,309
Employees expenses 9,91,90,178
Office operation expenses 5,18,267
Non-operating expenses 6,47,63,233
Other expenses
45,99,33,151
b)Total cash payments
29,61,45,836
i) Cash flow from operating activities(a-b)
Cash flow from investing activities: 6,46,11,210
Decrease in bank balance (5,65,52,857)
Increase in money at call & short notice (12,08,43,783)
Increase in investment (39,97,97,926)
Increase in loan, advances & bills purchased (1,16,05,935)
Increase in fixed assets 5,17,35,352
Decrease in other assets

ii) Cash flow from investing activities (47,24,53,939)

Cash flow from financing activities:
Decrease in outstanding loan (90,61,50,000)
Increase in deposits 1,20,11,03,174

16
 Decrease in bills payable (1,88,35,493)
Decrease in other liabilities (7,75,60,827)

iii) Cash flow from financing activities 19,85,56,854

Net cash flow of this year (i+ii+iii) 2,22,48,751
Add: opening cash balance 13,92,20,903
Closing cash balance 16,14,69,654

2.2 STUDY RESULT

As per major source of income is interest, so interest occupies a significant place in

operating activities. Total cash generated from interest is Rs. 60, 75, 95,662, but non –
operating income generates most cash flow this year i.e. Rs. 49, 496. Cash flows from
commission and discount, exchange gain and in other income are Rs. 7,23,51,675, Rs.
7,21,1 4, 868 , Rs. 44, 67,286 respectively.
Bank accepts deposits from people and normally pays interest in all deposits
except current account holders. Basically cash in the form of deposit occupies a
substantial place in the bank, so interest paid on deposit is larger than any other
expenses i.e. Rs. 24, 16, 39,164. Employees expenses, office operation expenses,
other expenses are Rs. 5,38,22,309, Rs. 9,91,90,178 and Rs. 6,47,63,233 respectively.
Under investing activities, other assets have been decreased. It implies that
bank has sold assets and cash generated there from Rs. 5, 17, 35,352. And fixed assets
have been increased which implies that the bank has purchased the fixed assets of Rs.
1, 16, 05,935.
No shares have been issued. Deposits have been increased by Rs.1, 20, 11,
03,174.Bills payable and outstanding loan have been decreased by Rs. 1, 88, 35,493
and 90, 61, 50,000 respectively. Bank has set up other liabilities amounted to Rs. 7,
75, 60,827.

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 Total deposits of customers in bank is Rs. 8,94,27,48,598 and cash balance
with bank is Rs. 16,14,69,654 and it has bank balance of Rs. 57,90,50,828. Total
balance of BOK is Rs. 74, 05, 20,482. Banks operate with a view that all customers
don’t demand cash at a time, so the amount is sufficient to make prompt payments to
customers.

18
 Chapter-3
Summary, Conclusion & Recommendation
3.1 SUMMARY
After the entry barriers paced on commercial banks were eliminated, many
banks were established introducing foreign investment as well as investment from
Nepalese people. And after the advent of democracy in Nepal, the government
accelerated the pace of economic reforms. After that time investments from countries
around the world was introduced. BOK was established in Falgun 28 th, 2051 B.S., in
which general public had 25%, Nepalese investor had 45% and Siam commercial
bank of Thailand had 30% share. Now the share structure had changed and financial
institutions possess 1.92%, organized institutions hold 0.35% and general public hold
97.73%. BOK has nine branches till now and successful in satisfying customers by
providing quality services. BOK has introduced ATM facility and ‘Sajilo Bachat’
targeting middle-class family and people with limited income. Bank is able to yield
30% profit in shareholders investment and will make payment of 15% cash dividend
in the current year. Bank provide loan to people going abroad, seeking jobs and has
made remittance easy. Its exchange gain increases by 12.59% than last year’s. Its
Recovery Cell is able to recover 10.35% of non-performing loan. It is involved in
various social activities.
Management accounting is the presentation of accounting information in such
a way as to assist management in the creation of policy and in the day-to-day
operation of undertaking. The purpose of management accounting is to provide
quantitative information that managers need for planning and controlling the activities
of an organization in order to reach the organization’s goal.
Cash is the lifeblood of a business enterprise, without which no activities can
be taken place. Cash flow analysis provides relevant information about the cash
receipts and cash payments of an enterprise during a period. Cash flow is useful in
assessing its liquidity, financial flexibility, profitability and risk. Cash flow
19
information is widely used by investors, analysts, creditors, managers and others.
Cash flow analysis use three techniques: cash flow from operation activities, cash
flow from investing activities and cash flow from financing activities.
Bank’s major source of income is interest and BOK’s total cash generated from
the same is Rs. 60, 70,95,662, non-operating income generates Rs. 49,496,
commission and discount, exchange gain and other incomes generate Rs. 7,23,51,675,
Rs. 7,21,14,868 and Rs. 44,67,286 respectively. Interest expenses of the bank is Rs.
24,16,39,164, employees expenses, office operation expenses and other expenses are
Rs. 5,38,22,309, Rs 9,91,90,178 and Rs. 6, 47, 63,233 respectively.
Cash generated from selling from other assets Rs. 5, 17, 35,352. No shares
have been issued. Deposits have been increased by Rs. 1, 20, 11, 03,174, bills payable
decreased by Rs. 1, 88, 35,493. BOK has made payment to set up other liabilities
amounted to Rs. 7, 75, 60,827.
3.2 CONCLUSION AND RECOMMENDATION
The bank is successful in satisfying customers by providing quality services.
Bank has no need of financing additional fixed assets. Bank as sold some of the other
assets as well and thus generated cash. Banks aims at targeting a wide range of
customers so it has introduced ‘Sajilo Bachat’, so that the middle-class people and
people with limited income can have their saving accounts in the bank and enjoy the
facilities. Bank too takes advantage of this by investing the amount, thus collected, in
productive sector. Profit is the basis for the existence of any organization. BOK has
earned sufficient profit that will finally attract more customers and expand its
business. It is successful in making payment 15% cash dividend to shareholders. Its
liquidity position is sound as it has sufficient cash balance at the end of the fiscal year
2065\66, which enables it to make prompt payments to its customers whenever they
produced cheques in the bank. By analyzing the P/L account, balance sheet and cash
flow statement, bank is sound as to set up its short-term liabilities and its profitability
is high at the same time.

20
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Bajracharya, B.C. (2067): Business Statistics Kathmandu: M.K Publishers.
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