Chapter1

Introduction
1.1 Background of the study
The history of banking is closely related to the history of money but banking transactions
probably predate the invention of money. Deposits initially consisted of grain and later other
goods including cattle, agricultural implements, and eventually precious metals such as gold, in
the form of easy-to-carry compressed plates. Temples and palaces were the safest places to store
gold as they were constantly attended and well built. As sacred places, temples presented an
extra deterrent to would-be thieves.

The first banks were the merchants of ancient world that made loans to farmers and traders that
carried goods between cities. The first records of such activity dates back to around 2000 BC
in Assyria and Babylonia. Later in ancient Greece and during the Empire lenders based in
temples would make loans but also added two important innovations; accepted deposits and
changing money. During this period there is similar evidence of the independent development of
lending of money in ancient China and separately in ancient India.

Banking in the modern sense of the word can be traced to medieval and early Renaissance Italy,
to the rich cities in the north like Florence, Venice and Genoa. The Bardi and Peruzzi families
dominated banking in 14th century Florence, establishing branches in many other parts of
Europe.[1] Perhaps the most famous Italian bank was the Medici bank, set up by Giovanni Medici
in 1397.[2]

The development of banking spread through Europe and a number of important innovations took
place in Amsterdam during the Dutch Republic in the 16th century and in London in the 17th
century. During the 20th century developments in telecommunications and computing resulting
in major changes to way banks operated and allowing them dramatically increase in size and
geographic spread. The Late-2000s financial crisis saw significant number of bank failures,
including some of the world's largest banks, and much debate about bank regulation.
Nepal Rastra Bank, the Central Bank of Nepal, was established in 1956 under the Nepal Rastra
Bank Act, 1955, to discharge the central banking responsibilities including guiding the
development of the embryonic domestic financial sector Nepal Bank Limited, the pioneer in
banking in our country is our country started its work since 1994 B.S. Right from inception it
carried out function of a commercial bank having felt the need of development of banking sector

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and monetary policies “ Nepal Rastra Bank act 2012” was established on 14th Baisakh 2013.
Since then it has functioning as a government bank.

About Himalayan bank

Himalayan Bank Limited (HBL) is one of the largest and reputed private sector banks of Nepal.
The Bank was incorporated in 1992 by a few eminent individuals of Nepal in partnership with
the Employees Provident Fund and Habib Bank Limited, Pakistan. Despite the cut-throat
competition in the Nepalese Banking sector, Himalayan Bank has been able to maintain a lead in
the primary banking activities- Loans and Deposits. The Bank commenced its operations in
January 1993. Himalayan Bank is also the first commercial bank of Nepal with most of shares
held by the private sector of Nepal. Besides commercial banking services, the Bank also offers
industrial and merchant banking service.

HBL is one of the pioneer commercial banks in the Nepalese banking industry with
it b e i n g o n e o f t h e i n i t i a l p r i v a t e c o m m e r c i a l b a n k s i n N e p a l . H B L i s
k n o w n f o r i t s expertise in project financing and having a reputed and “A” rated clientele.
Especially with its BOD containing reputed business houses like the Khetan Group, this bank has
a good business in hand. HBL is well known for its friendly work
c u l t u r e w i t h educated and professional employees motivated to work for
long working hours. Hence, HBL was chosen so as to experience the
professional working culture and acquire the best possible knowledge of
H B L ’ s e x p e r t i s e i . e . p r o j e c t f i n a n c i n g a n d o ther credit related functions and
products. Legacy of Himalayan lives on in an institution that's known throughout Nepal for its
innovative approaches to merchandising and customer service. Products such as Premium
Savings Account, HBL Proprietary Card and Millionaire Deposit Scheme besides services such
as ATMs and Tele-banking were first introduced by HBL. Other financial institutions in the
country have been following our lead by introducing similar products and services. Therefore,
we stand for the innovations that we bring about in this country to help our Customers besides
modernizing the banking sector. With the highest deposit base and loan portfolio amongst private
sector banks and extending guarantees to correspondent banks covering exposure of other local
banks under our credit standing with foreign correspondent banks, we believe we obviously lead
the banking sector of Nepal. The most recent rating of HBL by Bankers’ Almanac as country’s
number 1 Bank easily confirms our claim.

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With its head and corporate office at Thamel, Kathmandu, the bank has 33 branches. Thirteen of
its branches are located inside the Kathmandu while the rest are spread across the nation
.Besides, a branch looking exclusively at electronic cards and related products, is based in
Lalitpur.

Vision of the bank

Himalayan Bank Limited has the vision of becoming a leading Bank of the country by gaining
substantial business growth through provision of premium products and services to customers,
thus ensuring attractive and substantial returns to our entire stakeholder.
Mission of the bank
HBL’s mission is to become the preferred provider of quality financial services in the country.
There are two components to our mission: ‘preferred provider’ and ‘quality financial services’.
We believe that this mission will be accomplished only by satisfying these two important
components with the customer at the focal point of all our efforts. The bank always strives
positioning itself in the hearts and minds of the costumers.

Objectives of bank:
• To become the bank of the first choice
• To introduce new banking tradition and technologies to the customer.
• To explore and work vigorously on new product ideas so as to deliver something new to our
customer.
• To introduce modern banking product and services into banking sector.
• To diversify card business by focusing on Visa debit card, prepaid card and MasterCard.
• To expand remittances business to Asian, European and American markets with a focus on
further sophisticated services.
• To introduce deposits products tied up with debit and credit cards for the purpose of
increasing the number of debit and credit card customers remarkable.

Product and services:

The bank offers a wide array of products and services that are made suit the need of the
customers. Below are some of them:

1. Deposits

The bank has introduced a rich variety of deposit products. The bank offers deposit products
liked Normal saving scheme backed by accidental death insurance scheme and specialized
deposit products like Premium saving account (PSA).PSA is saving account with a host of
convenient features and benefits. With a view of adding more value to the deposit customer, the
bank is the first to install ATMs. For the convenience of institutional depositors, it has been
offering the current call account that is an operating account with healthy returns. Other types of

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deposits that the bank is operating currently are: fixed account, saving account, super premium
saving account (PSA),bishesh saving account, jumbo term and recurring saving account.

2. Corporate financing

It is one of the strategic banking activities of the bank. The bank actively engages in wholesale
banking with products and services design to cater to the needs of big houses .Adequate capital
and a strict capital standard give the bank the required lending strength for high volume credit.
Some of the products include Projects loan, revolving and non-revolving cash credit and trade
finance facilities.

3. Himal Remit

HimalRemit, a premium online customer focused and technology oriented Money Transfer
product is brought to you by Himalayan Bank Limited, the leading joint venture bank of Nepal.
Himalayan Bank is a pioneer in the field of retail money transfer business with over a decade
long customized service delivery experience in the field.
HimalRemit has the largest payment network covering all cities, towns and villages of the
country and is capable of paying at more than thousand locations across Nepal which is in ever
growing trend as per the demand of local customers and service providers.
HimalRemit is a state-of-the-art web-based online money transfer system. It is easily accessible
through our main web domain www.himalayanbank.com. It can be directly accessed by all our
branches and network thus ensuring prompt execution of the remittance. The product is
monitored and serviced 24/7 by our Remittance Promotion Department dedicated to deliver fast
and reliable services to the customers.
It has also been to trying to link its facilities to two more countries i.e. Canada and Belgium.
4. International banking

To assist its trading Customers, HBL offers Letter of Credit (LC) facilities. Customers can place
their LC application in any of HBL Branches. The fees/charges are one of the lowest amongst
the commercial banks of Nepal. The Customers enjoy wide correspondent network of Himalayan
Bank in addition to the attractive rates.
5. Ancillary Services

We offer a host of ancillary services that provide convenience, security and comfort for our
customers. They are::

• Safe Deposit Lockers: Locker facility of various sizes as per our customers’ preference and
convenience of location.

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• SMS Banking: Allows our customers to check their balance, status of cheque (encashed or not),
HBL’s foreign exchange rate and contact numbers of branches.

• Internet Banking: Banking can be done safely and securely from wherever there is a connection
at all times of the day.

• TC sales/purchase.

• 24/7 Automated Teller Machines (ATMs): in more than 50 locations.

• Everyday Easy Banking Service.

• Any Branch Banking Services.

• Funds Transfer: Within and outside the country.

• Fee Collection/Payment Services: For educational institutions.

• Service Package for Students: For those going abroad for higher studies

1.2 Objectives of the study

The objective of this report is to understand the banking process and analyze, examine and
interpret the financial aspects of the bank .It focuses on analyzing the competitive position of the
bank and to be familiar with the practical portion and specific uses of theoretical understanding.

The following are the objectives of the project:

• To analyze the general operations of the bank and the banking culture.
• To examine the financial performance of the bank in terms of market share, dividend per
share, earning per share, credit quality.
• To access the financial stability of the bank.
• To identify the standings and analyze the progress of the institution.
• To study about financial ratio and its analysis.
• To discuss fund mobilization and strategy of liquidity management of HBL.

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• To access the future trend of total deposit, net worth and investment.
• To access the various processes banks go through to overcome the risks associated with
loans and advances.
• To access a career option in this sector.
• Get hands on experience of commercial banks.
• Get acquainted with real working condition.

1.3 Significance of the study

Banking sector is growing faster and faster in Nepal because it provide quality service and
reasonable lending capital to borrower. May be one reason is it provide reasonable interest rate to
the public. There are many services which is providing by bank, which is beneficial to general
public. The main motive of commercial banking is to invest the capital and to gain the profit
which is really vey helpful for development of economy. There are various schemes which really
attract the customer such as opening the account in a minimum balance. Hence, there is a
competition between the banks which enhance the better quality of services. Therefore, conduct
ing project in banking sector is very much essential as it is a booming service oriented business
sector in Nepal. It has an awesome career opportunity through our management study. In present
context of Nepal, banking sector is one of the competitive sectors.

There is a cut-throat competition in the Nepalese Banking sector and this bank has always been
able to maintain a lead in the primary banking activities- Loans and Deposits. Thus, by doing this
project in this organization, it will be beneficial to improve the managerial skills as well be
familiar with accounting terminologies and techniques which are highly needed for the
management student. In the present context of Nepal, Himalayan Bank has already established
its mark as a major well fascinated financial institution and in the economic arena of the country.
It has also recognized itself as an institution having a different banking culture.
In brief, from this summer project, we can analyze the financial position of the institution .We
can also evaluate the hierarchy and activities of the employees and the other level staffs, how it’s
working systematically within the institution. It is definitely beneficial in the increment of
practical knowledge.
Foremost, this summer project is essential to meet the partial requirement of the bachelor in
business administration (BBA) curriculum.

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1.4Limitations of the bank
Following are the limitations of the study

• This report is presented as per the academic qualification of bachelor level and any higher
level analysis is tensed due to lack of knowledge.
• It is naturally been constricted by time as a 3 day visit to the bank is insufficient.
• The financial and other data are secondary data are secondary and detail primary data aren’t
made available to protect the privacy and financial secrecy.
• Some terms used in banking procedure were beyond my knowledge so I have written as it
was in the source
• The authenticity of the report depends on the authenticity of the data sources which are
secondary by nature

1.5 Organization of study

First chapter deals with introduction which includes introduction

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 Chapter2
Literature review
2.1 Brief History of the bank

2.7 Organisation structure

BOD

BOD Secretariat CEO Audit Committee

Shares Senior GM Internal Audit and inception department

Compliance and internal control Department Planning and Product Development Department

Executive human Resource Officer Branches (Through BM)

General Manager Marketing and Credit General Manager Operations

Executive Marketing Executive Financial

Executive Recovery Officer

Executive Credit Officer Executive Operating Officer

Executive Administrative officer

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 Executive Credit Officer Executive Administrative officer
Human Resource Department Legal Department

ITLegal Department
and SWIFT Department
IT and SWIFT Department
2.8 Department:
HumanDepartment
Customer Relation Resource(CRD):
Department
The major function of managers in CRD is to interact with the loan applicant/client
and discuss the need of the credit facility and other various factors related to it as well as
understand that there is inherent credit risk in any business proposal in the banking
sector. So the RMs in CRD has the ability or develops the ability to
i d e n t i f y t h e s e risks and develop ways to mitigate these risks with the capability to
properly monitor insurable inflow of predetermined returns. They work according
to the HBL’s Credit Policy Guidelines which has set the parameters of credit operation. This
department comes under the direct supervision of the branch managers and the
CAPs prepared have to be forwarded to the CCD after the approval
of the
BM.Managers in this department basically focuses upon serving cli
e n t s w i t h l o a n processing and managing their loan tenure especially loans for
business applications a n d e n t e r p r i s e s . T h e v a r i o u s p r o d u c t s o r s e r v i c e s t h i s
department provides to its customers are Subhida Loan (Revolving and
N o n R e v o l v i n g ) , p e r s o n a l l o a n i n t h e form of overdraft, loan processing for
assessing of credit limits for Letter of Credit, Overdraft loans, EMI based loans
for property purchase, Working Capital Financing, loans against financial instruments
like shares, fixed deposit etc.

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Credit Control Department (CCD):

The CCD comes under the head office and managers in CCD are directly
supervised by the General Manager- Marketing and Credit. The main function of managers
in CCD is to make thorough and critical analysis of the credit approval packages
forwarded by the CRD of the various branches all over the country. The credit
policy envisions delegation of authority to branch level, such that credit operations
can function smoothly. However, all the credit decisions cannot be finally made at
the branch level. Same credit proposals need to be decided at the corporate level,
even though they originate from branches. In order to streamline the flow of such
credit proposals, which are to be finally disposed off at corporate level, a team of managers
dedicated to do this has been created which is the Credit Control D e p a r t m e n t . A l l
t h e p r o p o s a l s r e l a t e d t o c r e d i t f u n c t i o n s a r e r o u t e d t h r o u g h t h e m whenever
such proposals are to be submitted at the corporate level. Other proposals coming
from A category branches are directly routed to the CCD.
Service department

Corporate services are activities that combine or consolidate certain enterprise-wide needed
support services, provided based on specialized knowledge, best practices, and technology to
serve internal (and sometimes external) customers and business partners.

At Himalayan Bank offer variety of products and services to our customers focusing on their
diversified and varied kind of financial needs and wants. Our product development and modifi
cation process is directly targeted to cater to the needs of our existing as well as potential
customers in the market and continuously enrolling our research unit in studying their behaviors.
We believe that the study of existing customer behavior is very crucial to understand customer
satisfaction regarding existing products and services offered by the financial institutions in the
market. Likewise, we are convinced that this study has enabled us to explore varied kind of fi
nancial needs and wants emerging in the market. Besides this, we are also on a constant look out
on emerging trends in the market. This has facilitated us time and again in capturing hints for
taping the untouched niche in the market. Such behavior has facilitated us in capitalizing our
potentials for achieving comparative advantage as a stepping stone for earning the fame of
pioneer move among our competitors & counterparts. We feel proud to be recognized as a
pioneer in introducing many innovative products & services. We are well known in the market as

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a convenient Bank for performing financial transactions. Our customers and stakeholders enjoy
secure financial transactions with us. Our innovative and quick learning approach in the technical
field has enabled us to stand as a techno savvy bank in the market. In short, we literally bring
banking services to our customers’ doorsteps. Account (zero balance account), Himal Remit
Savings Account (customized for remitters), Bishesh Savings Account (for minors, senior
citizens, the physically handicapped and the illiterate) and Shareholders’ Savings Account (for
the convenience of its shareholders).
We offer Current Account for daily business transactions. Call Account gives an earning
opportunity for businesses in their current account, while Non- Profit Organization Current Call
Accounts are designed for NGOs, INGOs and charitable trusts and have attractive interest rates.
Fixed Deposit products include Fixed Term Deposit, Three-Year Recurring Deposit (for monthly

deposits) and Jumbo Term Deposit (for those willing to park funds for 3 to 5 years and earn
attractive returns).

Finance department

Managerial or finance department is where the task of providing the funds for a corporation's
activities is to undertaken.Corporate finance generally involves balancing risk and profitability,
while attempting to maximize an entity's wealth and the value of its stock, and generically entails
three interrelated decisions. In the first, "the investment decision", management must decide
which "projects" (if any) to undertake. The discipline of capital budgeting is devoted to this
question, and may employ standard valuation techniques or even extend to real options
valuation; see Financial modeling. The second, "the financing decision" relates to how these
investments are to be funded: capital here is provided by shareholders, in the form
of equity (privately or via an initial public offering), creditors, often in the form of bonds, and the
firm's operations (cash flow). Short-term funding or working capital is mostly provided by banks
extending a line of credit. The balance between these elements forms the company's capital
structure. The third, "the dividend decision", requires management to determine whether any
inappropriate profit is to be retained for future investment / operational requirements, or instead
to be distributed to shareholders, and if so in what form. Short term financial management is
often termed "working capital management", and relates to cash-, inventory-
and debtors management. These areas often overlap with the firm's accounting function,
however, financial accounting is more concerned with the reporting of historical financial
information, while these financial decisions are directed toward the future of the firm.

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Marketing Department

Marketing is the process used to determine what products or services may be of interest to
customers, and the strategy to use in sales, communications and business development.[1] It
generates the strategy that underlies sales techniques, business communication, and business
developments.[1] It is an integrated process through which companies build strong customer
relationships and create value for their customers and for themselves.[1]

Marketing is used to identify the customer, satisfy the customer, and keep the customer. With the
customer as the focus of its activities, marketing management is one of the major components
of business management. Marketing evolved to meet the stasis in developing new markets
caused by mature markets and overcapacitiesin the last 2-3 centuries.[citation needed] The adoption of
marketing strategies requires businesses to shift their focus from production to the perceived
needs and wants of their customers as the means of staying profitable.[citation needed]

The term marketing concept holds that achieving organizational goals depends on knowing the
needs and wants of target markets and delivering the desired satisfactions.[2] It proposes that in
order to satisfy its organizational objectives, an organization should anticipate the needs and
wants of consumers and satisfy these more effectively than competitors.[2]
The marketing planning process involves forging a plan for a firm's marketing activities. A
marketing plan can also pertain to a specific product, as well as to an organization's
overall marketing strategy. Generally speaking, an organization's marketing planning process is
derived from its overall business strategy. Thus, when top management are devising the firm's
strategic direction or mission, the intended marketing activities are incorporated into this plan.
There are several levels of marketing objectives within an organization. The senior management
of a firm would formulate a general business strategy for a firm. However, this general business
strategy would be interpreted and implemented in different contexts throughout the firm.

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Chapter 3
Data analysis and presentation
Ratio analysis:-
A ratio is an expression of the quantitative relationship between two figures. It is a simple
mathematical expression of the relationship to one item to another. The relationship between two
meaningful accounting figures drawn from financial statements (i.e. income statement, profit and
loss account and balance sheet).

Ratio analysis is the important side of business sector. The important aspects of ratio analysis can
be listed as follows:-

• To express financial trend (it helps to express sales, costs, profit, dividend etc)
• It is useful in analysis of financial statement
• Ratio analysis provides information about the past performance of a firm and also useful to
financial planning & forecasting.
• Ratio analysis helps to understand the changes in the financial condition of the business over
years.
• Ratio analysis compares financial standing with post and can point out the deficiencies of
the business.
• Ratio analysis provides information about the overall formation or condition of a firm

3.1 Profitability Ratios:-

The profitability ratios are used as a measure to judge the operating efficiency (i.e.
success of failure) of a business organization. If organization will have no future it is
unable to make reasonable profit from its operation.
1. ROE (Return on equity)

Return on equity is calculated as follows:-

Return on Equity (ROE) = Net income after tax *100

Shareholders’ equity

(Rs ‘000)

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Fiscal Year Net Income After Tax Shareholders’ Equity Return On Equity (In
(In Rs.) (In Rs.) %)
2005/06 457,458 1,766,176 25.90
2006/07 491,823 2,146,500 22.91
2007/08 635,869 2,512,992 25.30
2008/09 752,835 3,119,881 24.13
2009/10 508798 3439205 14.79

Decision:-Higher ratio reflects the efficiency of the management in maximizing the wealth of the
real stakeholders of the firm.

2. Return On Total Assets (ROA):-

ROA is calculated as follows:-

ROA = Net income after tax *100
Total Assets

(Rs ‘000)

Fiscal Year Net Income After Tax Total Assets (In Rs.) ROA (in %)

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 (In Rs.)
2005/06 457,458 30,579,808 1.4959
2006/07 491,823 34,314,868 1.4332
2007/08 635,869 36,857,625 1.7252
2008/09 752,835 40,046,686 1.8798
2009/10 508798 43860251 1.1600

Decision:-Generally, higher ratio implies better return on permanent capital employed by an

organization. Higher ROA ratio better is the financing position of the bank. The ratio of return on
total assets measures the success and failure in the organization of the assets by the bank over the
years.

3. Equity Capital Ratio:-

Equity ratio is calculated as follows:-

Equity Capital Ratio = Equity capital

Total assets (Rs ‘000)

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Fiscal year Total Equity Capital Total Assets (In Rs.) Equity Capital Ratio
(In Rs.)
2005/06 1,766,176 30,579,808 0.05776
2006/07 2,146,500 34,314,868 0.06255
2007/08 2,512,992 36,857,625 0.06818
200 8/09 3,119,881 40,046,686 0.07790
2009/10 3,439,205 43860251 0.07841

Decision:-Higher the equity capital ratio lower will be the risk and lower be the return. Here we
can see in the above table and bar-diagram the equity capital ratio of Himalayan Bank Limited is
in increasing trend which indicates that the bank is willing to takes less risk and less return.

4. Interest Spread Ratio:-

Interest Spread ratio is calculated as follows:-

Interest Spread Ratio = Interest income - interest expenses

Total assets

(Rs ‘000)

Fiscal Year Interest Income Interest Expenses Total Assets (In Interest Spread
(In Rs.) (In Rs.) Rs.) Ratio
2005/06 1,626,474 648,842 30,579,808 3.196
2006/07 1,775,583 767,411 34,314,868 2.338
2007/08 1,963,647 823,745 36,857,625 3.092
2008/09 2,342,198 934,778 40,046,686 3.514
2009/10 3148605 1553531 43860251 3.636

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Fiscal year Total loan (In Rs.) Total Assets (In Rs.) Loan to total assets
ratio
2005/06 15761977 30,579,808 51.5437
2006/07 17793724 34,314,868 51.8542
2007/08 20179613 36,857,625 54.7501
2008/09 25519519 40,046,686 63.7244
2009/10 29123755 43860251 66.4012

5. Loan to total assets ratio

Loan to total assets =Total loan *100

Totalassets

6. Net operating cost ratio = Net operating cost /total assets

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Fiscal year Net operating cost (In Total Assets (In Rs.) Net operating cost
Rs.) ratio
2005/06 329699 30,579,808 1.0781
2006/07 322865 34,314,868 0.9408
2007/08 344321 36,857,625 0.9341
2008/09 398317 40,046,686 0.9946
2009/10
Fiscal year 471103
Total loan (In Rs.) 43860251
Total deposit (In Rs.) 0.0741
Net operating cost
ratio
2005/06 15761977 26490852 59.49
2006/07 17793724 30048418 59.22
2007/08 20179613 31842789 63.37
2008/09 25519519 34681345 73.58
2009/10 29123755 37611202 77.43

(Rs ‘000)

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 7. Loan to deposit ratio

Loan to deposits ratio=total loan *100

total deposit

3.2 ) Liquidity Ratio:-

Liquidity ratios are the ratios that provide the quick measure of the liquidity position or the
ability of the firm to meet its short-term obligation. In other words, liquidity ratios are the
indicator of short-term solvency of financial strength of the firm.

i. Current Ratio:-
Current ratio establishes the relationship between current assets and current liabilities. It
is computed by dividing current assets by current liabilities. Current ratio can be
calculated as follows:-
Current ratio= Current assets
Current liabilities
Current assets include all those assets, which in the form of cash or can be converted into
cash in the normal course of usual business not exceeding a period of one year. Likewise
current liabilities include all obligations maturing within a year.

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ii. Quick Ratio:-
As a more penetrating or refined nature of liquidity, quick ratio expresses the relationship
between quick or liquid assets and current liabilities, and is calculated by dividing quick
or liquid assets by the current liabilities as:-
Quick ratio= Quick assets
Quick liabilities
iii. Cash Reserve Ratio:-
The liquid assets that a central bank or other body mandates that a bank keep at all times.
The reserve ratio is expressed as a percentage of the bank's total deposits. The reserve
ratio exists to ensure that the bank is able to pay an unusually high number
of withdrawals on demand accounts should that event occur. It also helps ensure that the
bank does not over-leverage itself. In some countries, increasing or decreasing reserve
ratios may be used to help control the money supply. The liquid assets that a central
bank or other body mandates that a bank keep at all times. The reserve ratio is expressed
as a percentage of the bank's total deposits. The reserve ratio exists to ensure that the
bank is able to pay an unusually high number of withdrawals on demand accounts should
that event occur. It also helps ensure that the bank does not over-leverage itself. In some
countries, increasing or decreasing reserve ratios may be used to help control the money
supply.
iv. Turn Over Ratio:-
Resources of an enterprise as invested in assets with a view to generate income mainly
through sales. Activity ratios reflect the efficiency with which an organization manages
and uses assets in generating sales. These ratios indicate the degree of conversion of
assets into sales. The quicker the conversion in conformity with the investment, the more
efficient the management of the assets. Unless the end of year asset figures are adequate
approximations of the average levels for the year, the average of assets levels at the
beginning of the year and at the end of year are appropriate while making computations.
In the absence of information regarding the beginning levels of assets, the end of year
levels service the purpose well.
The usual ratios computed under this group comprises(a) inventory turnover ratio (b)
debtors or accounts receivable turnover ratio (c) average collection period or age of

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 receivables (d) fixed assets turnover ratio (e) total assets turnover ratio (f) capital
employed turnover ratio.

Chapter 4
SWOT Analysis
SWOT Analysis is one of the effective methods to formulate the plans, policies and strategy, of
an organization .With the help of this tool one can be familiar with the strength, understand the
weakness and cope with the opportunities and threats. Below are some of the strength, weakness
opportunities and threats of the Himalayan bank.

Strength
• Entrusted to qualified youth to shape the modern banking in Nepal
• Proper mechanism to maintain banking sanctity and ethics
• Conduction of briefing session and trainings for the employees
• Maintenance of corporate social responsibility
• Sound working environment for employees
• Accessibility of modern technology (hardware, software etc)
• Highly experienced employees
• Good interaction within professional organization.

Weakness:
• Fewer branches to provide banking facility
• slow document processing
• slow costumer complains
• less promotional campaigns
• the departments within the organization is increasing
• More time consumption to fulfill the afore said announcement
• some complains that the ATM machines are but sanctioning and relative long document
processing time is also the area in which the bank must focus upon.

Opportunities:
• Banking awareness among the people can increase the banking transaction
• use of modern and up to date technology can improve the functioning
• Youths can be entrusted for the processing of the banking activities
• Can be emerged as bank with new concept
• The mixed economy of Nepal is also an advantage as it has helped to remain aloof from, the
global financial crisis that is seriously influencing capitalist economies
• The political change and way toward s stability through a new constitution will certainly
benefit the business.

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Threats:
• Emerging new banks with new technology and ides
• Unethical competition and political instability
• Instable rules and regulation regarding banking sector
• Risk from the impact of global economic recession in the local market
• Risk from the fluctuation in the economic environment of the country
• risk emanating from excessive competition as a result of increase in number of banks
• obstacles in our way ( lack of advanced education bank needs to take advantage of
opportunities )
• the global financial crisis that is prevailing in the world also influence the bank

Chapter 5
Findings and Recommendations:
After the financial analysis and SWOT analysis of the Himalayan Bank Limited,
following findings and recommendations were made:

Findings
i) Himalayan Bank Limited is running successfully for several years since the year of
establishment.
ii) Continuity is given to recovery of written off loans.
iii) Since after its establishment it is in a state of point and continuously going on the
same task.
iv) The deposits on bank are increasing tremendously.
v) Bank is continuously increasing the number of branches.
vi) Also working in sector of business with different social activities.
vii) Also helping in economy of the country by contributing a lot of money through the
tax.
viii) Technically also the bank is able to introduce and other ancillary services.
ix) Continuity is given to installation of ATM’s in different regions.

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Recommendations
i) With the view of the customers care of the morning and evening counter and services
should be available.
ii) Continuity must be given to recovery of written off loans.
iii) Bank should utilize the resources effectively in interest generating sectors.
iv) Bank should invest maximum fund on risky assets.
v) Introduction and innovation of new products with new schemes is required.
vi) Training to the staffs should be provided to make the work effective.
vii) While leading fund to customer banks should evaluate and examine the credit
worthiness of customers.

BIBLOGRAPHY
Book references

• Pant PR and Wolf, HK,Social Science Research and Thesis writind ,Budha
publication,kathmanu

Other references
• www.himalaynbank.com.np
• www.nepalstock.com
• www.google.com
• www.wikipedia.com
• www.britannica.com

Library search

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Table of Contents
Chapter1......................................................................................................................................................1
Introduction.............................................................................................................................................1
1.1 Background of the study................................................................................................................1
1.2 Objectives of the study..................................................................................................................1
1.3 Significance of the study................................................................................................................2
1.4Limitations of the bank...................................................................................................................3
Chapter2......................................................................................................................................................4
Literature review.....................................................................................................................................4
2.1 Brief History of the bank...............................................................................................................4
2.2About Himalayan bank...................................................................................................................5
2.3 Vision of the bank..........................................................................................................................6
2.4 Mission of the bank.......................................................................................................................6
2.5 Objectives of bank:........................................................................................................................6
2.6 Product and services:.....................................................................................................................6
2.7 Organisation structure....................................................................................................................9
2.8 Department:.................................................................................................................................10
Chapter 3...................................................................................................................................................14
Data analysis and presentation...............................................................................................................14
Ratio analysis:-......................................................................................................................................14
3.1 Profitability Ratios:-....................................................................................................................14
3.2 ) Liquidity Ratio:-........................................................................................................................25
Chapter 4...................................................................................................................................................26
SWOT Analysis.....................................................................................................................................26

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 Strength.............................................................................................................................................26
Weakness:..........................................................................................................................................27
Opportunities:....................................................................................................................................27
Threats:..............................................................................................................................................27
Chapter 5...................................................................................................................................................28
Findings and Recommendations:...........................................................................................................28
Findings.............................................................................................................................................28
Recommendations.............................................................................................................................28
BIBLOGRAPHY.......................................................................................................................................29
BIBLOGRAPHY