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An Internship Report on Banking Sector, Focus on NIB Bank Limited


It is necessary for the students of Master that they should be acquainted with the
practical applications of their studies and should gain experiences. In this
connection every student is required to undergo a practical work known as
“Research Monograph” study in any specific topic of a field in any organization.

• The main purpose of this study is to fulfill the practical requirement of the
Masters of Business Administration degree.

• This study offers practical knowledge and experiences of courses studied.

• To write whole experience in a systemic and in an organized way under

the supervision of learned teachers and professors.

• To improve the writing and analytical skills among the students.

Research Monograph 1 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Research Monograph 2 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

This Research Monograph examines the general impact of Information Technology (IT)
on the banking industry. The banking industry has introduced various new customer
services and products using IT. The banking industry has gone through many changes as
a result of the introduction of IT. In fact, the structure of the industry is continuously
changing because of rapid development of IT. The continued success of IT applications
means that the limitations of current IT computer systems in banks have to be reboust.1
In the research, the banking industry has demonstrated a fair amount of competence in
the application of IT. Some banks were at the cutting edge of IT and have a clear vision
of how IT could be furthered applied successfully. Banks have spent millions of rupees
on IT every year in a bid to fully automate its operations and services to customers. The
industry recognizes that IT was a major key to its development.

The research brought to light the fact that IT has increased competition within the
industry. The realizations that the market size is not really increasing has made banks
more competitive. Also, the expectation of their customers is very high and in response
banks using IT to satisfy the demand for quality services and products. However, there is
an increasing outside threat to the banking industry from the non-banking sector.
Deregulation of the banking industry has introduced more competition but the low cost of
computer technology has made it easier to enter the industry. Non-banks can now pick up
off the shelf IT solutions for the services they want to provide.

The research reveals that traditional banks find it difficult to integrate new computer
technology with their old systems. As a result, their IT costs are higher than expected and
IT integration takes to much time.

Research Monograph 3 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


Banking as a system arose simultaneously with the use of notes. Notes have
come into use in the seventeenth century in England when many people held
heir wealth in gold. During the civil war, people were frightened of being robbed
so they had to look for someone who had a safe vault for his own business and
then to ask him to keep their gold in his safe. The obvious choice was the local
goldsmith who had a safe vault available in which he kept his gold coins and
bullion (Bullion is the name of given to uncoined refined gold and silver, generally
in the shape of bars of bricks). So it came about that goldsmith took these
deposit for safe keeping on charge of a fee and issued a receipt which
acknowledge the deposit of money and incorporated a promise to return it on
demand. More and more people came to hold these receipts. Thus, the original
purpose of the receipt became obscure as its function as promissory note – a
note which promises to pay – became all important. In time people stopped
calling them receipts and began to describe them as “notes”. Thus, the
goldsmiths emerged the first banks.

Research Monograph 4 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


It has not so far been decided as to how the word ‘Bank’ originated. Some
authors opine that this word is derived from the words ‘Bancus’ or ‘Banque’ which
mean a bench.

Other authorities hold the opinion that the word ‘Bank’ which means ‘joint stock
fund’. Later on, when the Germans occupied major part of Italy, the word ‘Back’
was Italianized into ‘Bank’.

It is, therefore, not possible to decide as to which of the opinions is correct, for no
record is available to ascertain the validity of any of the opinions. (Practice and
Law of Banking in Pakistan)

Banking is indicated as primitive as human society for ever since men came to
realize the importance of money as medium of exchange.

Today the word ‘Bank’ is used as comprehensive term for a number of

institutions carrying on certain kinds of financial business. In practice the word
‘Bank’ means, this borrows money from one class of people and lends to another
class of people for interest / Profit.

Research Monograph 5 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


Primarily all banks gather temporarily idle money for the purpose of lending to
others and investments which bring gain in the form of return, profit and
dividends etc. However, due to the variety of resources of money and the
diversity in lending and investment operations, banks have been placed in
various categories, such as commercial banks. Saving Banks, Merchants Banks,
Mortgage Banks, Consumer Banks, Investment Bank, Development Banks,
Cooperative Banks and Central Banks.


The commercial banks receive deposits from the general public which are
repayable on demand upon written orders of the depositors. As their most
distinctive feature the commercial banks maintain checking accounts for the

The commercial banks are also distinguished for providing short term finance to
trade, commerce and industry to enable these sectors to expand their productive

Research Monograph 6 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


Merchant banks are those which have been mainly financing the domestic and
international trade in United Kingdom. During the late eighteenth and early
nineteenth centuries the trade between countries was financed by bills of
exchange by well reputed merchant houses for which they would charge a
commission for their service. Thus the business of accepting bills of exchange to
finance the trade developed and gradually these business houses entered into
other banking activities and become known as “merchant banks”.

Since all the commercial banks, in addition to other banking functions, also deal
in trade financing, the term’ merchant banks’ has gradually faded away.


The basic purpose of these banks is to inculcate the habit of saving in the
people. The saving bank deposits are not repayable upon only the written orders
of the depositor but the depositor or his agent has to appear personally at the
saving bank to make withdrawal, and for this purpose he must present a pass
book, a certificate of deposit or some similar documents to prove his right to
receive payment. Post Office Saving Banks and Saving Account at National
Saving Organization are well known operational Saving Banks in Pakistan.


Research Monograph 7 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

These banks mainly deal in loans for the acquisition or construction or real estate
against the security of mortgages. Quite a few such banks are operating in
developed part of the world. Saving and loans associations and farm-loan
associations are some of the well known forms of the mortgage banks.


These banks provide finance for purchasing consumption goods for the use of
the borrowers. Consumer finance companies, sales finance companies and
credit unions are some of the popular forms of consumer banks.


The investment banks assist business houses and the governmental bodies to
raise money through the sale of stock and bonds for usually long term purposes.
These banks perform the usual functions of raising deposits of idle money from
the public and finance the business houses and other bodies.


These banks have been established to provide long term development finance to
the trade, commerce and industry. In Pakistan they are generally government
owned banks, established under a specially promulgated law. Zarai Taraqiati
Bank Ltd. and Industrial Development Bank of Pakistan is every well-known
developments bank.


These are the banks established and registered as a cooperative venture to
provide banking facilities to the members of the cooperative. In Pakistan, the
Federal Bank of Cooperatives is well known such bank.

Research Monograph 8 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


Central banks occupy unique position in the banking structure of a country
because they have been entrusted with the responsibility of controlling the
money supply, interest rates and financial market of the country for the purpose
of economic development.
State Bank of Pakistan, Bank of England and Federal Reserve Bank of U.S.A.
are well known central banks. (Practice and Law of Banking in Pakistan).


At the time of Independence, the areas which now constitute Pakistan were
producing only food grains and agricultural raw material for Indo-Pakistan
subcontinent. There were practically no industries, and whatever raw material
was produced was being exported from these areas. However, commercial
banking facilities were provided fairly well here.

The history of banking system in Pakistan dates back to independence of

Pakistan in August 1947, when various banks transferred their Head quarters
and funds to areas likely to fall in India. This trend emerged due to dominate rule
of Hindus in pre partitioned Indian Banking system. There were 3496 branches of
Indian scheduled banks in the undivided sub-continent as on 1st March 1947, out
of which only 487 branches were located in areas presently constituting Pakistan.
However, the number of branches of schedule banks drastically declined to 195
from 487 immediately after partition. At the time of partition, there were only two
banks having the honor to the first commercial banks of Pakistan, namely Habib

Research Monograph 9 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Bank Ltd, which was setup in 1941 with its Head in India and Australia Bank Ltd.,
which was established in 1944 with its Head office in Pakistan. Following the
partition, an expert committee was setup and this committee recommended that
the reserved bank of India being the Central bank of undivided India should
continue to function as Central Bank of Pakistan and the Indian Currency notes
would continue to be legal tender in Pakistan till 30th September 1948.

Subsequently it was decided to have separate central banks and the State Bank
of Pakistan (SBP) was setup and started functioning from 1st July 1948. Thus the
History of banking system in Pakistan started with the established of the (SBP)
was inaugurated by Quid0e-Azam Muhammad Ali Jinnah on 1st July 1948.
Consequently, three banks were established which include Muslim Commercial
Bank formed in September 1948, Bank of Bhawalpur in October 1948 and
National Bank of Pakistan in 1949. Habib Bank also transferred its Head office
from Bombay to Karachi, due to portioned in August 1947, and it was assisted by
SBP to finance domestic trade of country. The number of Pakistan scheduled
remained unchanged up to five till 1955. The State Bank allowed the bigger
banks to open any number of branches. By the end of December 1973, the total
number of Pakistani scheduled banks increased to 13. After the nationalization of
commercial banks in 1974, five major banks emerged to be main commercial
banks, branches exceeded 6700 in 1985. In early 1990’s the Government of
Pakistan has also established First Women Bank to encourage women for
making saving and investments, to provide them more job opportunities and to
seek their active partition in the development of national economy. In the hope
that banking would enter a new era of further development and progress, Banks
Nationalization Act, 1974, was promulgated and Pakistani Commercial banks
were nationalized in Pakistan since January 01, 1974. It has now been realized
that this step has proved counter productive, hence reversal has been initiated
since January 1991, after amending the relevant laws. Besides disinvestment
and privatization of nationalized commercial banks, establishment of commercial
Research Monograph 10 Muhammad Faraz Ali Khan
An Internship Report on Banking Sector, Focus on NIB Bank Limited

and other banks in private sector has also been encouraged. Consequently, a
large number of commercial and other banks have come into operation since
1992, in private sector, offering competitive prompt, as also courteous and
efficient service to the constituents.

A new concept of interest free banking was introduced in 1981 and by now it has
been established on sound footing, and new trends and techniques are being
implemented to make this system result oriented.

Electronic banking and several other new services like ATM, SWIFT Transfers,
Credit and Charge Cards etc, have been made available and their systematic
consumption is making Pakistani banking comparable to their several modern
counterparts anywhere in the developed world.

December 27, 1993 as a public limited companies ordinance, 1984 and received
license from the State Bank of Pakistan to undertake and carry on the business
of Banking in Pakistan on April 3, 1994.

Research Monograph 11 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Research Monograph 12 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited



NIB Bank is fastest growing financial power house in Pakistan. NIB Bank Limited
was incorporated in March – 2003 as a Public Limited Company. In October –
2003, all assets and liabilities and all rights and obligations of the former National
Development Leasing Corporation (NDLC) – One of the leading leasing company
in Pakistan and Pakistan operation of IFIC Bank of Bangladesh were
amalgamated with and into NIB Bank Ltd.
In April – 2004, NIB Bank also acquired the Pakistan operations of Credit
Agricole Indosuez.
The growth story of NIB Bank is a unique one. In a short span of four years, NIB
Bank is proudly serving nearly half a million customers through wide distribution
footprint across more than 60 small and large cities of Pakistan.
Becoming the 7th largest bank in Pakistan is just one dimension of our growth
story. The commitment of NIB Bank’s share holder can also be gauged through
its enormous paid-up capital of our Rs.40.000 Billion, First larges paid up capital
in Pakistan banking industry. Clearly these are the reasons for your confidence in
banks robustness. The majority shareholder is with Temasek Holdings of
The NIB Bank Ltd. acquire majority share holding of PICIC and full control of
PCBL in June 2007. NIB Banks acquisition of PICIC is one of the largest foreign
investment in Pakistan banking industry and great milestone in local financial

Research Monograph 13 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

sector. Principal share holding of NIB Bank will continue to be with Temasek
Holding Investment arm of Government of Singapore.

Since 1st of January 2008 NIB Bank Limited providing its services in financial
sector as “One Bank One Team” with all operations of PCBL and PICIC Merged
under NIB Bank Limited as a 7th largest bank in Pakistan along with
240 Branches, 450,000 Customers, Rs.197 Billion Total Assets, Rs.40.000 Billion
Paid-up Capital.


A Temasek holding is the investment arm of the Government of Singapore which

owns and manages Singapore Government’s diversified direct investments in
Singapore and overseas worth over US$ 134 Billion. It is rated ‘AAA’ by Standard
& Poor and ‘Aaa’ by Moody’s.

Temasek Holdings is a major shareholder in companies ranging from banking

and financial services to ports, shipping and logistics, airlines,
telecommunications and media, power, utilities and rail services, as well as
pharmaceuticals and biosciences.
Some of the prominent ownerships of Temasek Holdings include Singapore
Airline, DBS Bank of Singapore, Standard Chartered bank, Sing Tel and Port
Authority of Singapore. Through its directly and indirectly owned subsidiaries
Temasek Holdings has begun to increase its investments in the Asian Banking
and Financial Sector, Investments also include stakes in bank Danamon
Indonesia, Bank International Indonesia, ICICI Bank in India, Hana Bank of
Temasek Holding exposure to Pakistan has recently increased tremendously,
with Sing Tel acquiring a substantial stake in Warid Telecommunication Limited

Research Monograph 14 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

and port authority of Singapore securing a long term management contract of

Gwadar Port.
As one of the fastest growing banks in Pakistan, we would like to assure you that
there will be no interruption to the service you are currently enjoying and it will be
the same friendly faces serving you. As NIB Bank, we look forward to serving you
even better with new and enhanced products and services. You will have the
benefits of reaching us with ease through any of our 240 branches, in more than
60 cities across Pakistan. NIB Bank will provide you the benefit of transaction
ease through the 7th largest distribution network of the country and a network of
more than 100 ATM’s across Pakistan.


To become the bank-of-choice for the most discerning segments of the corporate
and consumer markets in Pakistan. We will employ state of the art technology
and communications systems to deliver financial services that are innovative and
affordable, and which will allow our customers to transact conveniently and


To be a premier financial institution of international standard and repute, offering

innovative value-added products and services, tailored receptively to the
customer's needs and satisfaction, while optimizing the shareholders' value
through meeting their expectations, making NIB an "investor preferred institution"
amply justifying its claims of a "financial supermarket" by catering all financial
needs of the customers under one roof.


Research Monograph 15 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Credit rating agency, PACRA, is currently in the process of evaluating the impact
of the merger of the PICIC and PCBL with and into NIB Bank Limited. Till the
completion of the review, the rating assigned to NIB of long term A+ and short
term A1 remain on Rating Watch, with positive implications.



NIB Bank Ltd is managed by a Board of Directors with representation Temasek

Holdings shareholders. The Board of Directors, which is the highest policy
making body of NIB, consists of eight directors. . The Board deals with all policy
matters and applications involving financial assistance up to the maximum
lending limit, accordingly to NIB total net worth both in foreign and local
currencies. The Board's Executive Committee, comprising of eight Directors,
deals with matters other than those involving policy and applications for financial
assistance. The following gentlemen presently comprise NIB Bank ltd Board of

Mr. Francis Andrew Rozario

Mr. Mahmudul huq Bhuiyan
Mr. syed Aamir Zaidi
Mr. Thomas Patrick Sodano
Mr. Tan Soo Nan
Mr. Willie Wai Kong Chan
Research Monograph 16 Muhammad Faraz Ali Khan
An Internship Report on Banking Sector, Focus on NIB Bank Limited

Mr. Phua Kok Kim

Mr. Khawaja Iqbal Hassan


NIB is equipped with very strong and experienced human resource structure
consisting of financial/ investment analysts, marketing experts/economists,
engineers, chartered accountants, cost accountants, financial accountants and
legal experts.

NIB has traditionally been hiring individuals from renowned educational

institutions and professionals with rich work experience so as to have a superior
blend of experts and strategists to manage the affairs of the Corporation.
Nib’s staff turnover is comparatively low which shows the compatibility of its
compensation policies for holding competent work force according to their
professional caliber.

NIB continues to pay special emphasis on the training of its professional staff and
avails to the maximum possible extent the training opportunities offered by the

Research Monograph 17 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

World Bank, ADB, ADFIAP, ADFIMI, etc. along with training programs available
within Pakistan.


Organizational chart is a diagram that represents the positions & relationship within an
organization that reveals the company’s organizational structure...

Research Monograph 18 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

President / CEO

Group Leader

Cluster Manager


Date Center Operation Manager

Relationship Incharge

Counter Service
Consultant Counter Service

Branch Service


NIB, after turning the corner, is now destined to revive its glory through
dynamic business activity which includes:

Research Monograph 19 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

• Enhancing Recovery of Loans.

• Resource Mobilization for On-Lending.

• Revival of Sick Units.

• Out Of Courts Settlement Even In The Cases Under Litigation

• Fund Management And

• Expanded Merchant Banking Operations.

• Growth in Lease Financing.

• With all such activities, NIB has started to earn sizable profit, and
has started to pay dividend to its shareholders NIB has reemerged
as a viable financial supermarket. The scope of NIB financing which
was previously confined mostly to providing long term foreign and
local currency assistance for setting up industrial ventures has
been further expanded to encompass provisions of other credit
facilities and services. Commensurate with the growing competitive
business environment, through the acquisition of a commercial

• NIB has realized that in order to meet the challenges of future

especially the Third Millennium, NIB needs to diversify from its
traditional role of provider of subsidized credits to sub-borrowers.
Realizing this NIB is diversifying itself with the changing financial
Research Monograph 20 Muhammad Faraz Ali Khan
An Internship Report on Banking Sector, Focus on NIB Bank Limited

and operational scenario; it has to readjust itself into a financial

institution which covers a wide variety of business operations. With
the privatization process in vogue and development of a free
market economy, the rules of business are substantially changing.

• The era of subsidized credits has been substituted with real market
forces requiring effective and efficient ability to conduct into the new
business order. NIB is presently exploring the possibilities of new
business areas as part of its diversification plan.


Research Monograph 21 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

As a member of World community of development partners, NIB is also deeply

concerned with international agenda like Environmental Protection. NIB is keen
in pursuing to augment efforts in this direction. For the purpose of environment
protection specially in the area of industrialization process where environmental
threats are more common in the shape of air and soil pollution and threat to
human health. NIB is also concerned with the increasing global realization of
quality standards. Nib’s lending policy is being further improved to support
industrial production process in conformity with the ISO standards. NIB it self is
keenly interested in following a path which leads to its ISO certification as a
financial institution in near future.

Research Monograph 22 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited



Research Monograph 23 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


3.2 Changing Face of Banking Business

Research Monograph 24 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

 Products and services

 Emergence of new delivery channels
 Convergence of core banking business and information technology
 Mergers & acquisitions
 New services (Tele-banking, E banking, door step banking) and new approaches
to banking (automated self banking centers

 Core banking
 Customer relationship management
 CUG networks
 Kiosks / new delivery channels
 Risk management
 Wireless Technologies

 Smart cards
 Data Centre / DM / DW
 Call Centre/Help Desks
 Resource management
 Internet / electronic banking

Research Monograph 25 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

3.3 NIB BANK Secure Links Between Existing

And New Technology Platforms

NIB Bank—Pakistan 7th-largest commercial bank--values the ability to maintain

security while making mainframe data accessible across an open client/server
network. NIB Bank today has 240 branches in Pakistan. It takes a progressive
approach to information technology, and has created a truly distributed
client/server environment with the Open Software Foundation's Distributed
Computing Environment (DCE) providing the secure connections.

NIB Bank was already using telecommunications in the 1995 to boost its back
office operations. In the 2000, the focus shifted to the front office, and the need to
give more autonomy to the branches. "As a result, NIB moved to a form of
distributed computing in which local branches could service 80% of their own
needs.”They only contacted the mainframe to store and forward transactions, or
to execute exceptionally large transactions."

Because of the synergy between the various NIB Bank company systems, the
bank wanted to incorporate existing equipment as far as possible: "With the
infrastructure in place, NIB are now changing applications that are 10 or 15 years
old to the new DCE environment, and testing the various types of transactions--
many of them running under PIBAS."

Research Monograph 26 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

3.4 Banking network

Research Monograph 27 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

NIB bank banking application can be access around its 240 branches through
out Pakistan though dedicated network link (through PTCL DSL service , Wimax
technology by Wateen Telecom , Cyber network ISP .as whole network is

Security Services provide NIB Bank with security tighter than is possible with
conventional passwords. DCE entrusts security not to the client or the server, but
to a "third party"--a dedicated and physically secure DCE security server. This
server controls three security processes:

• Authentication, to identify both the client and the server. This involves a
complex process of encrypted tickets, and thus avoids the exposure of
sending passwords over the network.

Research Monograph 28 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

• Authorization, which determines whether that client has the right to access
the resources it is requesting (the server holds access control lists).
• Encryption, based on the DES encryption algorithm that enables an
organization to choose various levels of security up to full encryption with
all data encoded.
• These processes are hidden from users. All they see is a simple means of
using one password and one username to gain access to any data to
which they are entitled, anywhere on the network, without having to ask
for access to individual networks and servers.

3.5 How NIB Bank Plans To Benefit

• Centrally-held information and data will be more easily available to

authorized users anywhere in the network
• Branch staff can be more effective through being able to access
commercial information and better-quality services and facilities
• Tight security through a dedicated security server and unique user IDs
• Information is consistent at every site because DCE's global file system
holds only one logical copy of a file for the whole network
• DCE's true open systems environment offers the flexibility to incorporate
the bank's existing multi-vendor systems, and add to the network as
required in the future
• Administration and management can be reduced because changes need
only be made once at a single point for distribution across the whole

Research Monograph 29 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Research Monograph 30 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Protection Against Security Threats

4.1 Protecting Online Banking from Security Threats.

5 Essential Components of Online Banking Security

Today, all major banks offer online baking services to their customers. They also
have taken many steps by adding security features to the service infrastructure,
such as measures to prevent identity theft and fraud so that online banking is a
safe and secure experience. However, as more customers depend on a reliable
online access, there are steps to take against new types of online threats. Great
Disasters happen, not because people run risks, but because they don’t
understand the risks.

Research Monograph 31 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

How come the Cyber attack in NIB IT infrastructure stopped by firewalls

and the Internet Service Providers

Denial of service (DoS) attacks and Distributed Denial of Service

(DDoS) attacks are very difficult to stop using firewalls because the
content is legitimate and the intent is malicious.

Most ISPs for online banks do not have adequate tools and techniques
required to stop the onslaught. They can simply take down the
network - which furthers the purpose of the attackers.

Comprehensive Online Banking Network Protection

Feature DDoS Firewall Content Web Application
Mitigation Based Security
Security (Application
(IPS) Firewall)
Floods Yes No No No
(SYN, TCP, UDP, ICMP, Fragment, Port, etc.)
Botnet Attacks Yes No No No
Source Tracking, Source Limiting Yes No No No
Continuous Behavior Learning and Adaptive Control Yes No No No
Header and State Anomalies Yes No No No
Port Scans, Network Scans, Dark Address Scans Yes No No No
ACLs Yes Yes No No
NAT No Yes No No
Stateful Inspection No Yes Yes No
Stateful Signatures No No Yes No
Traffic Signatures No No Yes No
Cross Site Scripting, Parameter Manipulation, No No No Yes
Command Injection
Information Leakage No No No Yes

A comprehensive security plan for security includes both network security and application security
Research Monograph 32 Muhammad Faraz Ali Khan
An Internship Report on Banking Sector, Focus on NIB Bank Limited

4.2 Architecture of NIB BANK Secure Online

Banking Network

Research Monograph 33 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

The goal of the research process is to produce new knowledge, which takes
three main forms

• Exploratory research, which structures and identifies new problems

• Constructive research, which develops solutions to a problem
• Empirical research, which tests the feasibility of a solution using empirical

Research can also fall into two distinct types:

• Primary research
• Secondary research

In social sciences and later in other disciplines, the following two research
methods can be applied, depending on the properties of the subject matter and
on the objective of the research:

• Qualitative research
• Quantitative research

Research is often conducted using the hourglass model Structure of Research.

The hourglass model starts with a broad spectrum for research, focusing in on
the required information through the methodology of the project (like the neck of
the hourglass), then expands the research in the form of discussion and results.

Exploratory Research Method

Exploratory research provides insights into and comprehension of an issue or
situation. It should draw definitive conclusions only with extreme caution.
Exploratory research is a type of research conducted because a problem has not

Research Monograph 34 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

been clearly defined. Exploratory research helps determine the best research
design, data collection method and selection of subjects.

During this research project report on NIB, I have used Exploratory Research

Sources of data
1. Primary data
2. Secondary data

1. Primary data
Primary data, which I have personally collected during my internship
period at NIB, from sources like interviews and discussions with bank
staff and management personnel, personal observation and doing
work myself.

2. Secondary data
This data is collected by annual reports of bank journals and
brochures published by NIB Bank, also collected necessary
information from banking related books, magazines, newspapers and
Bank website.

Research Monograph 35 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


During this research the following difficulties have been experienced by the

• Time Limitations The main problem faced by the internee during this
study was time limitation. Due to shortage of time on the part of the study
and officials of the bank, very few meetings and visits have been
• Secrecy of the Data

Another major problem faced was the secrecy of data. Because of that,
The IT security breach and NIB IT security policy. Hence the availability of data is
very much limited.

Research Monograph 36 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited


Today banks have to look much beyond just providing a multi-channel service platform
for its customers. There are other pressing issues that banks need to address in order to
chalk-out a roadmap for the future. Here are some of the concerns in the mind of every
bank's CEO.
• Customer retention: Customer retention is one of the main priorities for banks
today. With the entry of new players and multiple channels, customers have
become more discerning and less 'loyal' to banks. Given the various options, it is
now possible to open a new account within minutes. Or for that matter shift
accounts within a couple of hours. This makes it imperative that banks provide
best levels of service to ensure customer satisfaction.
• Cost pressures: Cost pressures come into play when banks are not able to afford
the cost of a certain service or initiative although they want to or need to have it in
place. This is primarily because the cost structure at the backend is not efficient
enough to offer that kind of service to the marketplace.
• The need for more investments in IT has increasingly forced some banks to sell-
out of certain banking operations. The cost of IT investment required to remain
competitive and the uncertainty future profits has forced withdrawal.

• Security of information systems was found to be very vulnerable in general. The

amount of resources that is required for security is lower than required. The fact
that ‘Hackers’ can still get into banking IT systems easily without inside help
demonstrate the magnitude of the problem.

• IT Fraud is also a major problem of the banking industry especially where plastic
cards are concerned. The increased IT knowledge of the general public and
proliferation of cheap computer technology mean that weaknesses in card
Research Monograph 37 Muhammad Faraz Ali Khan
An Internship Report on Banking Sector, Focus on NIB Bank Limited

payment systems are exploited fraudulently. Millions of Rupees is lost to plastic

card fraud every year. This is simply because the cards are not secure enough.

• Bank IT and Security staff need to fully understand the

organization’s risks and vulnerabilities. Knowing the drivers for
change, both the external & internal influences. They must
develop a corporate risk profile. Implement a strong Governance
and Controls infrastructure. Monitor and maintain the security
and risk profile to meet new challenges.

• Reputation risk associated with Denial of Service attacks can

impact public opinion that results in a critical loss of funding or


In recommendation the banking industry need to better apply IT to improve its

operations, customer services and products. Banks should devote more resources to
development of secure IT systems, services and products. Also, the future impact
outsourcing IT requirements should be thoroughly evaluated, the long term effect may be
very expensive.

A. Adoption of Effective technology

It is suggested that responsible steps should be taken to insure IT security

B. Job Training Programs

Nib needs to provide its employees with classroom training. It needs to
have its own training institution in Pakistan, as it is a leading bank. Such
institution can provide training opportunity to other local banks employees

C. Perquisites and Allowances

The number of allowances and perquisites for the employees should be
increased to ensure that they put their body and soul in the jobs assigned
to them.
Research Monograph 38 Muhammad Faraz Ali Khan
An Internship Report on Banking Sector, Focus on NIB Bank Limited

D. Permanent Hiring
The fresh hiring should be made permanent so that they are secured of
their future. Further the allowances and perquisites attached with the
permanent jobs will also increase the motivation level of the employees.





4. NIB information booklet. 30/06/2009

5. Schedule of bank charges and services.


7. NIB Bank’s annual report. (2008)

8. Quarterly Report of NIB Bank ( March 31, 2009)


10. Research methods in education by L Cohen, L Manion, K Morrison – 2007

Writing at University: a guide for students by P Creme, MR Lea - 2003

Research Monograph 39 Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Research Monograph 40 Muhammad Faraz Ali Khan