A CASE STUDY

ON
PROFITABILITY AND SOLVENCY POSITION OF KANCHAN
DEVELOPMENT BANK LTD.
Mahendranagar, Kanchanpur

Submitted By:
LAXMAN SINGH SAUD
BBS IIIrd Year
Exam Roll No:-3290107
T.U. Regd no:-

A FIELD WORK REPORT

Submitted To:
Siddhanath Multiple Campus
Faculty Of Management,Trivuwan University

In partial fulfillment of the requirement for the degree of

Bachelor of business studies
Mahendranagar, Kanchanpur
2071
 Siddhanath Multiple Campus
Mahendranagar, Kanchanpur

Recommendation
This is to certify that the field work assignment.
Submitted By:
LAXMAN SINGH SAUD
BBS IIIrd Year
Exam Roll No:- 3290107
T.U. Regd no:-

Entitled
A Case StudyOn
“PROFITABILITY AND SOLVENCY POSITION OF
KANCHAN DEVELOPMENT BANK.”

Has been prepared as approved by this campus in the prescribed format of

the Faculty of Management. This fieldwork assignment is forwarded for
the examination.

…………………….. ………………………………… …………………………

Supervior Head of Department Campus Chief
Date:………………..
 ACKNOWLEDGEMENT

Field study plays a vital role to develop the faculty of judgment, thought and evaluation in the
students. This note of acknowledgement is to express my gratitude from the bottom of my
heart to all the concerned people, who have directly or indirectly contributed towards
achieving this result First, I would like to thank Tribhuwan University for introducing this
concept of fieldwork activity and report writing, which will up bring our creativity and will also
help us for further study. This study not only helped me in academic view but also helped me
to understand the financial Analysis of Kanchan Development Bank Ltd. and to know about the
bank operation in Farwestern.

This study would have been very complex without the co-operation and assistance of bank’s
staff who shared me bank current position and make data available. I am thankful to all who
assisted in the data gathering process and co-operated with us to visit every concerned.
Similarly I would like to express my most sincere gratitude to my Campus Chief Dr. Mukund
Kalauni and lecturer Mr. Uttam Thapa for their guidance and remarkable suggestions.

Finally, I would like to offer my Special thanks to all and would always be obliged for any
appreciation/suggestion from the valued readers regarding the fieldwork report.

Researcher
Laxman Singh Saud
BBS 3rd year
Siddhanath Multiple Campus
Mahendranagar, Kanchanpur
 Table of Contents

Chapter I: Introduction
Page No.
1 Background of the study 1
1.1 Evolution of The Bank 2
1.1.1 Development Banks in Nepal 3
1.1.2 Functions of Development Banks 7
1.1.3 Introduction of Kanchan Development Bank 8
1.2 Statement of Problem 9
1.3 Objective of the study 10
1.4 Importance of the study 11
1.5 Limitation of Study 11
1.6 Review of Literature 12
1.7 Research Methodology 13
1.7.1 Method of Data Collection 13
1.7.2 Tools and techniques used 14
1.8 Limitation of the study 15

Chapter II: Presentation & Analysis of Data

2 Profitability Measurement 16
2.1 Return On Total Assets 16
2.1.1 Return On Equity 17
 2.1.2 Net Interest Margin 19
2.1.3 Earning Per Share 20
2.1.4 Net Profit Margi 21
2.2 Solvency Measurement 22
2.2.1 Equity Multiplier 22
2.2.2 Debt To Assets Ratio 23
2.2.3 Debt To Equity Ratio 24
2.3 Diagrammatical and Graphic Presentation

Chapter III: Summary, Conclusion & Recommendation

3 Summary 28
3.1 Conclusions 29
3.2 Major Findings of the study 29
3.3 Recommendation 30
BIBLIOGRAPHY 31
 ABBREVIATIONA

A/C = Account
ATM = Automated Teller Machine
AU = Assets Utilization ratio
BVA = Book Value of Assets
DE = Debt-Equity Ratio
DTA = Debt to Total Assets ratio
EM = Equity Multiplier
EPS = Earning Per share
DPS = Dividend Per Share
ES = Earning Spread
FY = Fiscal Year
KDB = Kanchan Development Bank
Ltd. = Limited
MVS = Market Value of Assets
NIM = Net Interest Margin
NPAT = Net Profit after Tax
NPM = Net Profit Margin
NRB = Nepal Rastra Bank
ROA = Return On Assets
ROE = Return On equity
ROI = Return On Investment
Rs. = Rupees
 NAPT = Net Profit After Tax

List of Tables

Table No Name of Tables Page no

1 Development Banks In Nepal 4

2 Return on Total Assets of KDB 17

3 Return on Equity of KDB 18

4 Net Inerest Margin of KDB 19

5 Earning per Share of KDB 20

6 Net Profit Margin of KDB 21

7 Equity Multiplier of KDB 23

8 Debt Assets Ratio of KDB 24

9 Debt Equity Ratio of KDB 25

 List of Figures

Figure No Name of Figures Page

1 Net Incme 26

2 Income Compisition 26

3 Expense Compisition 27
 BIBLIOGRAPHY

Annual Report of Kanchan Development Bank Ltd.

Joshi, Dr. S. (2005). Banking and Insurance .Taleju Publication, Kathmandu

Research department (N.R Bank), Economic Report

Bhole, L.M.(2003),Financial Institutions and Markets,Tata McGraw-Hill, New Delhi

Rose, P.S. (2004). Commercial Bank Management .Irwin McGraw Hill, New Delhi

Joshi, Padam Raj (2004),Fundamentals of financial management, Kathmandu,

Asmita Books Publisher & Distributers
Singh, H.B. (2005). Banking and Insurance. Asia Publication, Kathmandu,