Financial Performance Analysis of NRB Commercial Bank Limited

Submitted to:

Shah-Noor Rahman
Assistant Professor
Department of Business Administration
Faculty of Business and Entrepreneurship
Daffodil International University

Submitted by:

Md Rabbi Hossen
ID# 171-11-5519
BBA Program
Department of Business Administration
Faculty of Business & Entrepreneurship
Daffodil International University

Date Of Submission:21/06/2022
Letter of Transmittal

21 July 2022

Shah Noor Rahman

Assistant Professor
Department of Business Administration
Faculty of Business and Entrepreneurship
Daffodil International University

Subject: Internship Report Submission on "Financial Performance Analysis of NRBC

Bank Limited"

Dear Ma’am,
It gives me great pleasure to share my internship report on "Financial Performance Analysis of
NRBC Bank Limited" This is an excellent opportunity for me to complete a significant part of
my Bachelor of Business Administration; in this report, I try to clarify NRBC Bank Limited’s
financial condition. I learned a lot about NRBC Bank Limited while working on this topic.
I tried to include as much information and related issues as possible in this report while also
following your instructions.

Finally, I would be happy to answer any question related to this report.

Sincerely Yours,

………………………
Md Rabbi Hossen
ID# 171-11-5519
BBA Program
Department of Business Administration
Faculty of Business & Entrepreneurship
Daffodil International University

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Approval Certificate
This indicates that, Md Rabbi Hossen, ID: 171-11-5519, finished the Internship Program
and submitted a report titled " Financial Performance Analysis of NRBC Bank Limited "
under my supervision. Under my instruction, he completed his internship report. He
worked quite hard to achieve this. I think it will support his in improving a professional
life in the near future.

I wish him every success in his career.

…………………………………………
Shah-Noor Rahman
Assistant Professor
Department of Business Administration
Faculty of Business and Entrepreneurship
Daffodil International University

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Student’s Declaration
I declared that the report Financial Performance Analysis of NRBC Bank Limited was
prepared after I have finished all of my academic courses at Daffodil International University,
under the supervision and assistance of Shah-Noor Rahman, Assistant Professor Department of
Business Administration, Faculty of Business and Entrepreneurship, Daffodil International
University. I wrote this report totally on my own, with the exception of the books and web pages
listed in the references section. I further guarantee that the research indicated in this short-term
position is original and that it has not been submitted to any other institution or foundation for
any degree, grant, or other purpose.
There are no issues with copyright in the information I've provided. As a result, I agree to accept
the University's compensation for any misrepresentation caused by my failure to do so, with no
obligation on my behalf.

………………………
Md Rabbi Hossen
ID# 171-11-5519
BBA Program
Department of Business Administration
Faculty of Business & Entrepreneurship
Daffodil International University

i
Acknowledgment
I'd like to thank one of my supervisors, Shah-Noor Rahman, Assistant Professor Department of
Business Administration, Faculty of Business and Entrepreneurship, Daffodil International
University, for allowing me to complete my internship report on “Financial Performance
Analysis of NRBC Bank Limited”; no one can achieve perfection without the help of a
instructor. As a result, without the help of a skilled teacher, an understudy will never be flawless.
Every student's life may be changed by an excellent instructor. The Study is really grateful to one
of my supervisors, Shah-Noor Rahman, Assistant Professor Department of Business
Administration, Faculty of Business and Entrepreneurship, Daffodil International University, for
enabling me to complete my internship report and his recommendations and guidelines. Were of
great assistance to me.

Those who provided me with the opportunity to operate in this field are much appreciated by the
Study. The Study would also want to express my sincere gratitude to all officers, as well as my
companions and Senior Brother, for their invaluable support and advice in preparing my
internship report.

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Executive Summary
The banking industry makes a significant contribution to our country's economic growth. NRBC
banks have made major contributions to Bangladesh's prosperity and development. NRBC was
founded in April 2, 2013.This study examines NRBC Bank Limited's financial performance over
the previous five years from 2017 to 2021. This study will offer a review and analysis of the
NRBC Banks's profitability, liquidity, leverage position, and activity conditions using statistics
from the previous five years' financial statements (2017-2021).
The main objective of my report is to analyze NRBC Banks's financial performance,
highlighting key factors that hamper success and making recommendations. This report will
provide an evaluation and analysis of the Debt ratio, ROA, ROE, operational profit ratio, net
interest income ratio, and interest spread ratio using figures from the financial statements for
five years (2017-2021). The ratios were able to provide a clear concept of the overall
performance of the company.
From the ratios analysis we can say that the performance of NRBC Bank Limited is decreasing
after 2018 because of high inefficient cost management and asset utilization. The bank
increases the use of debt which will increase the interest expense. After this there are some
recommendations are given to overcome from this situation.

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Table of Contents
Letter of Transmittal..................................................................................................................................i
Approval Certificate..................................................................................................................................ii
Student’s Declaration.................................................................................................................................i
Acknowledgment.......................................................................................................................................ii
Executive Summary..................................................................................................................................iii
Chapter – 01...............................................................................................................................................1
1.1 Introduction...........................................................................................................................................2
1.2 Background of the Study.......................................................................................................................2
1.3 Objectives of the Study..........................................................................................................................2
1.3.1 Primary Objective...........................................................................................................................2
1.3.2 Secondary Objectives.....................................................................................................................2
1.4 Scop of the Study..................................................................................................................................3
1.5 Methodology of the Study.....................................................................................................................3
1.5.1 Sources of Data...............................................................................................................................3
1.6 Limitations of the Study........................................................................................................................4
Chapter – 02...............................................................................................................................................5
2.1 About NRBC Bank Limited..................................................................................................................6
2.2 History of NRBC Bank Limited............................................................................................................6
2.3 Vision & Mission of NRBC Bank Limited............................................................................................7
2.4 Organogram of NRBC Bank Limited....................................................................................................8
2.5 Product and Service of NRBC Bank Limited........................................................................................9
Chapter – 03.............................................................................................................................................10
3.1 About Financial Performance Analysis...............................................................................................11
3.2 Tools of Financial Performance Analysis............................................................................................11
3.2.1 Horizontal analysis........................................................................................................................11
3.2.2 Trend analysis...............................................................................................................................11
3.2.3 Ratio analysis................................................................................................................................11
3.2.3.1 Profitability ratio....................................................................................................................12
3.2.3.2 Efficiency Ratio.......................................................................................................................12
3.2.3.3 Activity Ratio..........................................................................................................................12
3.2.3.4 Leverage Ratio.......................................................................................................................12
Chapter – 04.............................................................................................................................................13

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4.1 Ratio Analysis of NRBC Bank Limited...............................................................................................14
4.1.1 Return on Asset (ROA).................................................................................................................14
4.1.2 Return on Equity (ROE)...............................................................................................................15
4.1.3 Net Interest Margin (NIM)...........................................................................................................16
4.1.4 Non-Interest Margin (NIM)..........................................................................................................17
4.1.5 Operating Profit Margin (OPM)...................................................................................................18
4.1.6 Earning Per Share (EPS)...............................................................................................................19
4.1.7 Net Profit Margin (NPM).............................................................................................................20
4.1.8 Asset Utilization (AU)..................................................................................................................21
4.1.9 Equity Multiplier (EM).................................................................................................................22
4.1.10 Earning Spread...........................................................................................................................23
Chapter – 05.............................................................................................................................................24
5.1 Findings of the Study...........................................................................................................................25
5.2 Recommendations:..............................................................................................................................26
5.3 Conclusion...........................................................................................................................................27
References.................................................................................................................................................28

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 Chapter – 01
Introduction

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1.1 Introduction
NRBC Bank Limited is the organization where I am doing my internship program. I worked as
an intern in the Foreign Exchange Department's Import Division. The bank is the most important
financial institution in the economy. Controlling and maintaining the flow of money through the
economy, as well as the economy's overall viability, is largely dependent on the bank's efforts.
There are now 57 banks functioning in Bangladesh, with a few more on the way. There are 40
local commercial banks, nine international banks, and eight state-owned banks. Bangladesh's
government has granted three NRB banks permission to operate in the banking sector. One of
them is NRBC Bank Limited, with the other two being NRBC Bank Limited and NRBC Global
Bank. NRBC Bank is one of the most recently established prominent banks in Bangladesh's
banking zone.

1.2 Background of the Study

As part of the Bachelor of Business Administration (BBA) degree program offered by Daffodil
International University, each student is required to do an internship in a reputed business firm
and then write a report on their experiences there. As a student pursuing a Bachelor of Business
Administration degree, I participated in an internship at NRBC Bank Limited for a period of
three months. Drawing on the practical knowledge I gained during my time there, I wrote a
report for my internship with the working title "Financial Performance Analysis of NRBC
Bank Limited."

1.3 Objectives of the Study

1.3.1 Primary Objective
The main objective of the study is to scrutinize the Financial Performance of NRBC Bank
limited.
1.3.2 Secondary Objectives
 To evaluate the financial position and performance of NRBC Bank Limited from the
period of 2017 to 2021.
 To calculate the financial ratios and identify the areas of concern.
 To understand the implications in analyzing and interpreting the financial ratios.
 To measure the managerial efficiency of the firm as well as earning capacity of NRBC in
future period.

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  To suggest better ways for enhancing the performance of the Bank;

1.4 Scop of the Study

The report, titled "Financial Performance Analysis of NRBC Bank Limited," focused on NRBC
Bank's financial performance flows. The purpose of this study is to determine how different
external and internal variables influenced the profits flow of NRBC Banks. It is possible to have
a better knowledge of the genuine financial position and earnings flow of the NRBC Banks by
compiling this report.

1.5 Methodology of the Study

This study followed a systematic manner from topic selection through final report creation. One
of the most important components is data collection and identification. These data are then
categorized, processed, and inferred using the method outlined above to acquire the crucial
points. In addition, this study will go through the whole procedure in more detail.
In order to make the endeavor a success, I have collected data from a variety of sources,
including primary and secondary sources.
1.5.1 Sources of Data
To make this report as effective as possible, both primary and secondary data were used.

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1.6 Limitations of the Study
There were several limitations are faced in finishing the report. Some of the most important
limitations are as follows:
• There isn't enough time to learn about all of each branch's financial activities.
• A single workstation cannot form a completed field when examining the financial
structure.
• It is extremely difficult to gather all of the authentic facts from various work forces for
their essential activities.
• A key barrier in establishing the report is the bank's agreement not to disclose private
information and data.
• As a consequence of minor facts, assumptions are occasionally accepted. As a
consequence, there may be a few acceptance mistakes.

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 Chapter – 02
About NRBC Bank Limited

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2.1 About NRBC Bank Limited
Bangladesh's financial industry is dominated by the commercial banking system. The Central
Bank and Bangladesh Bank Order, the country's principal financial and financial system
regulating bodies, created the Bangladesh Bank Order on December 1, 1972, v2. Four state-
owned commercial banks, five specialized banks - five private commercial banks, one land
development bank, and nine foreign commercial banks - the Nobel Prize-winning Grameen
Bank, a specialized micro-finance company that revolutionizes the concept of micro-finance and
poverty reduction in Bangladesh - make up the banking system. The female Qi made a
significant contribution to the battle. NRB Commercial Bank is a private commercial bank that is
supervised and regulated by the Bangladesh Bank (BB). Three new commercial banks,
sponsored by NRBC, have been licensed by the central bank on the condition that they help
improve foreign currency inflows.

Mr. Farsat Ali, an engineer with extensive expertise, is the founding chairman of NRB
Commercial Bank. He works at SNA Knitting Mills Inc., a knitwear company based in the
United States. The President and other board members are well-known in their respective
industries. This lovely lady has a clear objective and vision in mind. Their goal is to introduce a
large number of vulnerable individuals to NRB Commercial Bank Limited, rather than restricting
it to a restricted group. Their goal is to give really world-class service to NRB Commercial Bank
Limited.

2.2 History of NRBC Bank Limited

NRBC was founded on April 2, 2013, with a capitalization of Tk. 1000 crore. Bangladeshi
expats in various parts of the globe have long wished to create a new bank to aid the
motherland's economic growth with their hard-earned foreign cash. Demand for a new bank from
NRBs expecting increased inbound foreign remittances and the potential for investment from
other nations is an appropriate basis for consideration. Many NRBs from industrialized nations
have a high level of education and professional skills in a variety of disciplines, making them
valuable resources for our country. The sponsors of the NRB will provide not just a large amount
of investable funds, but also "state-of-the-art technology" to help construct a world-class bank
that is customized to fit the country's particular developmental requirements. In order to boost
the flow of inbound foreign remittance, our people must be made fit and skilled to compete with
their peer group of other nations. A bank, such as NRB, may play a critical role in accomplishing

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the intended aim. Furthermore, given the current state of banking in Bangladesh, it is widely
anticipated that the new bank would be able to compete with existing banks by using new risk
management principles and bolstering the organization's assets and health. We feel that, in light
of the aforementioned difficulties, Bangladesh Bank accepted applications for the desired bank
and granted letters of intent in behalf of suitable businesses.

2.3 Vision & Mission of NRBC Bank Limited

Vision:
To become a world-class bank in terms of efficient and innovative banking services, depositor
protection, shareholder satisfaction, and economic growth support, with a special focus on
channeling regular inflows of foreign remittance from Bangladeshi expatriates working abroad,
as well as the inflow of idle and less lucrative funds held with wealthy NRBs.
Mission:
 Through our numerous financial products, the bank will commit itself to instilling trust in
Bangladeshi expats to invest by providing them with desired services, appealing
profitability, and safe investment.
 Through our trustworthy and trusted intermediary services, the bank will provide
extraordinary prospects to intended wage workers in obtaining positions overseas.
 To compete against foreign competition, the bank will organize a need-based effective
training and education program for Bangladeshi FC wage employees.
 To both retail and corporate clients, the bank will provide service excellence by
delivering current and novel products in a cost- and time-effective way.
 The bank will continually concentrate on and analyze its clients' evolving wants and
ambitions in order to offer new services and reengineer the service delivery process.
 To safeguard depositors' interests and deliver the maximum return to shareholders, the
bank must constantly be diligent in keeping banking business risks within its tolerated
level.
 The bank will be a pioneer in utilizing new sources of capital, such as asset securitization
and mutual fund issuance, to meet the needs of newly emerging financing areas such as
SME financing, factoring, micro finance, IT-based products, housing financing, and so
on, in order to contribute to the country's economic growth.

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  The bank must build an enabling atmosphere, as well as embrace and carefully foster a
team-based culture in which employees are driven to accept banking challenges and
compete against other firms.

2.4 Organogram of NRBC Bank Limited

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2.5 Product and Service of NRBC Bank Limited

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 Chapter – 0

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3.1 About Financial Performance Analysis
The term "financial performance" refers to the degree to which a company is able to maximize
the value of the revenues and profits generated by its core line of business. The phrase is also
employed as a general assessment of the overall financial health of a company over the course of
a specific period of time.

Financial performance is a common metric that analysts and investors use to assess companies
operating in the same industry, as well as those operating in other industries or sectors.

A company's stakeholders include trade creditors, bondholders, investors, workers, and

management. Each group is interested in monitoring a company's financial performance. The
financial performance of a corporation determines how successfully it earns income and manages
its assets, obligations, and the financial interests of its stakeholders and investors.

3.2 Tools of Financial Performance Analysis

The following are the most often used financial analysis tools:
3.2.1 Horizontal analysis
Horizontal analysis looks at financial information from two different time periods. Revenue and
cost accounts are looked at to see how things have changed from one period to the next. Most of
the time, these changes are given as a percent.
3.2.2 Trend analysis
If you compare three or more financial reporting periods, you can see a trend. Management pays
a lot of attention to trends. Managers, for example, like to see sales go up while costs go down,
because this means profits will go up.
3.2.3 Ratio analysis
The most common way to do financial analysis is to use the income statement and balance sheet
to figure out ratios. Financial measures can be used to find out about a company's liquidity,
profitability, financial leverage, and asset turnover.
Ratios are made for a number of reporting periods to find out if there are any good or bad trends
over time. You can also compare a company's ratios to the benchmark ratios that other
companies in the same industry report. When a company's ratios are compared to data from its
industry, it can be seen if the company is doing better or worse than its competitors.

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3.2.3.1 Profitability ratio
Profitability ratios are financial measures that investors use to figure out how likely a company is
to make a profit over a certain time period based on its revenue, operational costs, balance sheet
assets, and equity shareholders. These numbers tell investors how well a company can use its
assets to make money and add value for its owners. A higher ratio is better because it shows that
the company is making money and has enough cash on hand. Different types of profitability ratio
are given below:

3.2.3.2 Efficiency Ratio

The efficiency ratio is often used within a company to figure out how well its assets and
liabilities are being used. Analysts use efficiency ratios, which are also called activity ratios, to
measure how well a company is doing right now. All of these ratios measure how busy a
company is by looking at its current assets or current liabilities. An efficiency ratio measures
how well a company can make money from its assets.
3.2.3.3 Activity Ratio
An activity ratio is a financial metric that shows how well a company uses the assets on its
balance sheet to make money and make money. Activity ratios, also called efficiency ratios, help
analysts figure out how a company manages its inventory, which is important for its operational
flexibility and overall economic health.
Different types of activity ratio are given below:
• Total asset turnover
• Fixed asset turnover

3.2.3.4 Leverage Ratio

A leverage ratio is one of several ways to figure out how much of a company's capital is in the
form of debt (loans) or to figure out how well a company can pay its bills. Businesses run on a
combination of their own money and debt. Knowing how much debt a company has can help you
figure out if it will be able to meet its obligations when they are due.

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 Chapter – 04
Analysis

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4.1 Ratio Analysis of NRBC Bank Limited
4.1.1 Return on Asset (ROA)
Particular 2021 2020 2019 2018 2017
Return on Asset 1.19% 1.28% 1.40% 1.61% 1.62%

Return on Asset
1.80%
1.61% 1.62%
1.60%
1.40%
1.40% 1.28%
1.19%
1.20%
1.00%
0.80%
0.60%
0.40%
0.20%
0.00%
2021 2020 2019 2018 2017

Interpretation:
NRBC Bank Limited’s Return on Asset (ROA) From 2017 to 2021, is showing downward trend.
The return on assets (ROA) is usually an indicator of managerial efficiency; it shows how well
management can transform an institution's assets into earnings. In 2017 the ROA was 1.62%
which decrease the next year in 2018 to 1.61%. After the 2018 the ROA start decreasing
continuously, which indicate that the bank is not efficient to convert its asset to earnings, which
is bad sign for the company.

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4.1.2 Return on Equity (ROE)

Particular 2021 2020 2019 2018 2017

Return on Equity 14.01% 14.00% 13.22% 14.49% 15.17%

Return on Equity
15.50%
15.17%
15.00%
14.49%
14.50%
14.01% 14.00%
14.00%

13.50%
13.22%
13.00%

12.50%

12.00%
2021 2020 2019 2018 2017

Interpretation:
The return on equity of NRBC Bank Limited is showing fluctuating trend from 2017 to 2021. In
2017 the ratio was 15.17% which decreased to 13.22% in the next year 2019. But after 2019
significantly increased in 2020 & 2021. It is a good sign for the bank.

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4.1.3 Net Interest Margin (NIM)
Particular 2021 2020 2019 2018 2017
Net Interest Margin 1% 3% 3% 3% 2%

Net Interest Margin

4%

3% 3% 3%
3%

2%
2%
1%

1%

0%
2021 2020 2019 2018 2017

Interpretation:
The amount of difference between interest revenue and interest cost management that the bank
has been able to achieve through cost control over its earning assets is measured by net interest
margin. Net Interest Margin showing a fluctuating rate following the years 2017 to 2021. In 2017
the NIM was 2% which increased a little bit in 2018 to 3%, From 2018 to 2020 the NIM was
constant that was 3% but in 2021 it decreased to 1% that means in 2021 the bank was unable
manage its interest expenses.

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4.1.4 Non-Interest Margin (NIM)

Particular 2021 2020 2019 2018 2017

Net non-interest margin 1.2% 0.1% -0.4% 0.5% 0.9%

Net non interest margin

1.4%
1.2% 1.2%
1.0%
0.9%
0.8%
0.6%
0.5%
0.4%
0.2%
0.1%
0.0%
2021 2020 2019 2018 2017
-0.2%
-0.4% -0.4%
-0.6%

Interpretation:
The non-interest margin is calculated by dividing non-interest revenue by non-interest cost.
Because the primary purpose of a bank's business model is to lend money, interest is its primary
source of income, and cash is its principal asset. When interest rates are low, banks rely heavily
on non-interest income. Non-interest income sources can be reduced to entice customers to
choose one bank over another when interest rates are high. The Non-Interest Margin NRBC Bank
Limited is showing fluctuating trends.

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4.1.5 Operating Profit Margin (OPM)

Particular 2021 2020 2019 2018 2017

Net Bank Operating Margin 2.7% 2.9% 2.8% 3.2% 2.9%
(OPM)

Net Bank Operating Margin (OPM)

3.5%
3.2%
3.0% 2.9% 2.8% 2.9%
2.7%
2.5%

2.0%

1.5%

1.0%

0.5%

0.0%
2021 2020 2019 2018 2017

Interpretation:
The graph is showing the operating profit margin ratio of NRBC Bank limited. The operation
profit margin of NRBC Bank has a strong growth following the years, it almost remains constant
from 2017 to 2021. The highest OPM of NRBC Bank limited was 3.2% in 2018 compared to
four years and the lowest OPM was in 2.7% in 2021 compared to other years.

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4.1.6 Earning Per Share (EPS)
Particular 2021 2020 2019 2018 2017
Earnings Per Share (EPS) 2.4 2.0 1.8 1.8 1.9

Earning Per Share (EPS)

2.5 2.4

2.0
2.0 1.9
1.8 1.8

1.5

1.0

0.5

0.0
2021 2020 2019 2018 2017

Interpretation:
The graph is showing the Earning Per Share (EPS) of NRBC Bank Limited. Earnings per share is
one of the most significant indicators used to determine a company's absolute profitability. The
EPS of NRBC Bank Limited is showing a fluctuating trend from 2017 to 2021. In 2017 the EPS
was 1.9 which decreased to 1.8 in 2018 and remain constant to 2019 after that it start increasing
continuously. That means the expenses are decreases and the company is able to managing its
operational costs.

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4.1.7 Net Profit Margin (NPM)

Particular 2021 2020 2019 2018 2017

Net Profit Margin (NPM) 21.7% 23.8% 25.0% 26.4% 28.9%

Net Profit Margin (NPM)

35.0%

30.0% 28.9%
26.4%
25.0%
25.0% 23.8%
21.7%
20.0%

15.0%

10.0%

5.0%

0.0%
2021 2020 2019 2018 2017

Interpretation:
The graph is showing the Net Profit Margin of NRBC Bank Limited from 2017 to 2021. The net
profit margin shows how much of a Bank's income is converted into profit per dollar of income
collected. The NPM of NRBC Limited is showing decreasing trends over the year 2017- 2021. In
2017 the NPM was 28.9% which decrease a little bit in 2018 to 26.4% and start decreasing
continuously and decreased to 21.7% in 2021. It means that the bank uses an ineffective cost
structure.

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4.1.8 Asset Utilization (AU)

Particular 2021 2020 2019 2018 2017

Asset Utilization 5.5% 5.4% 5.6% 6.1% 5.6%

Asset Utulization
6.2% 6.1%

6.0%

5.8%
5.6%
5.6% 5.6%
5.5%
5.4% 5.4%

5.2%

5.0%
2021 2020 2019 2018 2017

Interpretation:
The graph is showing the Asset Utilization Ratio of NRBC Bank Limited from 2017 to 2021.
From the graph it is clearly shows that the asset utilization ratio of NRBC Bank Limited is
fluctuating from 2017 to 2021. In 2017 the Asset Utilization ratio of NRBC Bank was 5.6%
which increased in the next year 2018 to 6.1% after that it start decreasing to 2021. Compared to
five years in 2018 the asset utilization ratio was highest it means in 2018 the bank was more
efficient to generating revenue by utilizing its own asset but after 2018 it starts decreasing which
means that the bank is inefficient to generate revenue from its assets.

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4.1.9 Equity Multiplier (EM)
Particular 2021 2020 2019 2018 2017
Equity Multiplier (EM) 11.81 10.95 9.46 8.97 9.36

Equity Multiplier (EM)

14
12
12 11
10 9 9
9
8

0
2021 2020 2019 2018 2017

Interpretation:
The graph is showing the Equity multiplayer of NRBC Bank Limited from 2017 to 2021. The
equity multiplier is a risk indicator that analyzes how much of a bank's assets are funded by equity
rather than debt. The graph shows an increasing trends of Equity multiplayer of NRBC Bank
Limited. In 2017 the Equity multiplayer was 9.00 which increased to 12.00 in 2021. That means
the is using a large amount of debt to finance assets.

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4.1.10 Earning Spread
Particular 2021 2020 2019 2018 2017

Earning Spread 0.96 1.35 1.58 1.51 0.85

Earning Spread
1.80
1.58
1.60 1.51
1.40 1.35

1.20

1.00 0.96
0.85
0.80

0.60

0.40

0.20

0.00
2021 2020 2019 2018 2017

Interpretation:
The graph is showing the Earning Spread of NRBC Bank Limited from 2017 to 2021. The bank
spread is a measurement of a bank's profit margin. Because the difference between interest
received and interest paid out is large, a wide spread leads to a bigger profit margin. The earning
spread of NRBC Bank limited is showing a fluctuating trend. In 2017 the spread was very low
that means in 2017 the bank can’t make large profit but in 2018 and 2019 the spread was highest
it means in 2018 and 2019 the bank makes higher profit margin.

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 Chapter – 05
Findings, Recommendations and Conclusion

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5.1 Findings of the Study
1. Return on asset showing a diminishing trend 2017 to 2021.Among the rates in 2017 the
ROA was 1.62% which decreased to 1.19% in 2021. Which indicates that the bank in
inefficient to utilize its asset. And the Return on equity of the bank also showing a
fluctuating trend from 2017 to 2021. In 2017 the ROE was 15.17% which decreased to
13.22% in 2019 after that it increased a little bit and increased to 14.01% in 2021.
2. The operating profit margin of NRBC Bank Limited is decreasing continuously after
2018. It means the bank is unable to manage its operational cost effectively.
3. The NPM of NRBC Bank Limited is showing decreasing trends over the year 2017- 2021.
In 2017 the NPM was 28.9% after that it start decreasing continuously. It means that the
bank uses an ineffective cost structure.
4. Asset utilization ratio of NRBC Bank Limited is fluctuating from 2017 to 2021. In 2017
the Asset Utilization ratio of NRBC Bank was 5.6% which increased in the next year 2018
to 6.1% after that it start decreasing. Compared to five years in 2018 the asset utilization
ratio was highest but after 2018 it starts decreasing which means that the bank is
inefficient to generate revenue from its assets.
5. The Equity multiplayer of NRBC Bank Limited is shows an increasing trend. In 2017 the
Equity multiplayer was 9.00 which remain constant to 2019 after that it start increasing a
little bit and it increased to 12.64 in 2021. That means the is using a large amount of debt
to finance assets.

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5.2 Recommendations:
1. Return on asset and return on Equity showing a diminishing trend 2017 to 2021. Which
indicates that the bank in inefficient to utilize its asset. So, they should be careful about
it to increase ROA and ROE
2. To increase the operating profit margin the bank should manage its operating expenses
effectively.
3. To improve the Net Profit margin (NPM) the bank should make change its cost structure.
4. To increase the Asset Utilization (AU) the bank have to ensure effective use of its asset.
The bank can sell its unused assets or improving the inventory management.
5. To increase the Asset Utilization (AU) the bank needs to ensure the effective use of its
assets. The bank can sell its unused assets or improve inventory management.
6. At last, the bank must have made a good combination of debt to equity to take
advantages form tax and interest expenses. Because if the bank can reduce the different
type of cost it will help to increase the net profit.

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5.3 Conclusion
During my internship period, I was trying to taking hands-on knowledge on regular
banking activity of NRBC Commercial Bank Limited. I was trying to follow the
instruction of my reporting officer. The working environment of the bank was very
nice and all employee of the bank was very helpful. Now I know how to open a
bank account, what types of documents was needed and how to handle customer.
The main thing on which they need to focus is Social Networking that is the main
topic now a day. The more they will focus on social interactions with customers,
the more they will gain in return. The development of a private commercial bank
depends largely in the quality of service provided to their customers. Quality of
service depends on the proficiency and the quality of the employees of the bank
administration. The authority of NRBC has to be alert in their performance. After
finishing my internship, I communicate with my supervisor to prepare the report.
My supervisor was given me the guideline to prepare the report. I am trying my
best to fallow the instruction of my supervisor to prepare the report.

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References
Annual Report of NRBC Commercial Bank Limited (2019-2015)

https://www.nrbcommercialbank.com//assets/form/report/annual2015.pdf

https://www.nrbcommercialbank.com//assets/form/report/annual2017.pdf

https://www.nrbcommercialbank.com//assets/form/report/AnnualReport-2018.pdf

https://www.nrbcommercialbank.com//assets/form/report/AnnualReport-2019.pdf

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