Internship Report On National Bank of Pakistan

National bank of Pakistan
INTERNSHIP REPORT ON
NATIONAL BANK OF PAKISTAN
Internship Report submitted to the Faculty of Management &
Administrative Sciences in Partial Fulfillment of the Requirements for
the Degree of Bachelors of Business Administration.
Program & Session
MBA (2011-2015)
UNIVERSITY OF GUJRAT
Date of Submission
Name of Program Coordinator

Signature of Program Coordinator_________________
(MBA)
Page 1
Dedicated To:
Our Honorable Teachers & Loving Parents
Whose,
Love, Affection, Motivation, Patience, Support
&
Spiritual Inspirational
Give us Encouragement,
To all those People who have
quenched for Knowledge,
To all those who have dedicated
their lives to others,
To all of those who have served
and sacrificed for
Sake of Freedom
To all of those people, who may be gone now,
But they will never be
Forgotten....
(MBA)
Page 2
TABLE OF CONTENTS
Topics
Page No.
Executive summary
Acknowledgement
Introduction to Report
Introduction
Evolution of banking
Definition of banks
Types of banks
10
14
History of NBP
15
Nature of organization
16
Branch network
16
Board of directors
19
Products
20
Services
22
Awards and success
25
Pest Analysis
26
Economic contribution
27
Mission statement
28
Objectives
29
Organizational structure
30
Organ gram of NBP
31
Main branches of NBP
32
Comments
33
Departments
34
Foreign exchange department
35
(MBA)
Page 3

Topics
Page No.
Import and export department
42
General banking
47
Account section
47
Locker service
54
Clearing department
55
Consumer & retailing
56
Financial analysis
61
Business volume
62
Financial analysis for bank
63
Performance
64
Weekly Internship Activities
65
SWOT Analysis
________88
Suggestion and recommendation
93
Conclusion
94
Glossary
95
References
96
(MBA)
Page 4
Executive Summary
This report is about National Bank of Pakistan, its history and functions of the
bank. This report contains detail about what I have done and learned in my two
month internship in National Bank Qila Didar Singh Branch. It starts with the
short introduction and background and introduction about the management of
The Bank. The vision of the bank along with its mission and existing status has
also been discussed. This report contains detail about Business Practices in
National Bank Qila Didar Singh.
The purpose of this exercise was to learn while working in the practical field.
Specially, the knowledge related to the General Banking, Foreign Exchange
and Advances. It has really helped me to observe what extent the bookish
knowledge is being practiced in real field.
In the business process analysis detail procedurals has been discussed
regarding different departments and products. I have also mentioned my duties,
accomplishments, and knowledge which I have gain during internship. At the end
of this report I have given suggestion and recommendation where I observe
pitfalls and drawbacks in National Bank with conclusion.
(MBA)
Page 5
Acknowledgement
I am highly grateful to almighty Allah who gave me the power to complete this report
.I am also highly thankful to my honorable teachers for theirs guidance.
I am indebted to all the employees of National Bank of Pakistan Qila Didar Singh branch
and special thanks to MR. Saif-ul-Hassan Branch Manager Qila Didar Singh,
Mr.Usman Ali (Operation Manager) and all other employees of the branch for their
cooperation.
(MBA)
Page 6
Introduction to Report
This report concerned to my all working that I did during the internship period of
two month. This report involves the working a procedure of different banks that
are working in Pakistan. As National Bank of Pakistan is purely a Government
Bank, so its order and procedure are considered by other commercial Banks.
I have worked in NBP. I saw the organizational structure of NBP and different
department of National Bank of Pakistan.
During my work I came to know about General Banking then I did financial
analysis of National Bank of Pakistan. In which I calculated special ratios of bank
and calculated profitability of bank through ratios.
In this report I mentioned my internship activities. At the end I did SWOT analysis
of NBP and then I give my suggestions and recommendation to NBP.
(MBA)
Page 7
(MBA)
Page 8
EVOLUTION OF BANKING
It has not so far decided as to how the word bank originated. Some authors
opine that this word is derived from the word bancues or banque which mean a
bench. The explanation of this origin is attributed to the fact that the Jews in
Lombardy transacted the business of money exchange on benches in the
market-place, the banco was destroyed by the people incidentally the word
bankrupt is said to have been evolved from this practice the opponents oh this
opinion argue that if it was so, then how is it that the Italians money changer
were never called Banchierei in the middle ages?
Other authorities hold the opinion that the word bank in derived from the
German word back which means joint stock fund latter 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 find out the validity of any of the opinions.
Modern Banking
Banking in its modern form and structure stared in Britain when many of the
Lombardy merchants came to England in the fourteenth century and settled in
the parts of the city of the London now called Lombard Street.
The king Edward III established the Office of Royal Exchanger for changing
foreign money at a profit for the benefit of the Crown In 1854 the joint Stock
Companies Act opened an era of corporations; and the Limited Liability Act,
1855, restricted the liability of the share holder of the limited company.
(MBA)
Page 9
DEFINITIONS OF BANK
(1) Banks do business of money. Rather banks doing business of

lending and borrowing loans.
(2) Banks are guardian distributor of cash money.
(3) Bank are receiving money and collecting drafts for the customers and
also have the duty of honoring cheques from time to time by the customer to
the amount available to their current accounts.
(MBA)
Page 10
Types of bank:
Primarily all banks gather temporarily idle money for the purpose of lending to
other and investment gain in the form of return, profits and dividends etc.
however, due to the verity of resources of money and the diversity in lending and
investment operations, banks have been place in various categories, such as
Commercial bank
Savings bank
Merchant banks
Mortgage banks
Consumer bank
Investment bank
Central bank
(MBA)
Page 11
Commercial Bank:
The commercial banks received 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 the checking accounts for the
constitutions..
The commercial banks are also recognized for providing short-term finance to
trade, commerce and industry to enable these sectors to increase their
productive activities.
Merchant Banks:
Merchant banks are those, which have been mainly financing the domestic and
international trade. During the late 18 th and early 19th centuries the trade between
countries was financed by bill of exchange by well-reputed merchants houses for
which they would charges a commission for their services
Savings Banks:
The basic purpose of these banks is to inculcate the habit of saving in the people
the savings banks deposits are not repayable upon only the written order of
depositor but the depositor of his agent has to appear personally at the saving
banks 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 his
payments. Post office savings banks and savings accounts at national saving
organizations are well known national saving banks in Pakistan.
(MBA)
Page 12
Mortgage Banks:
These banks mainly deal in loans for acquisition or construction of real estate
against the securities of mortgage.
Consumer banks :
These banks providing finance for purchasing consumption goods for the use of
Brewers
Investment banks:
These banks assists business houses and governmental bodies to raise money
through the sale of stocks and bond 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 other bodies.
Central banks:
Central banks occupy the unique position in banking structure of a country
because they have been interested with the responsibility of controlling the
money supply, interest rate, and financial market of a country for the purpose of
economic development.
(MBA)
Page 13
INTRODUCTION ABOUT BANKING SECTOR

Banking is the business of providing services such as financial services to
consumers and businesses.
The main services a bank provides are checking accounts, which can be used
like money for payments and purchase goods and services; savings accounts
and time deposits that can be use to save money for future use; loans that
consumers and businesses can use to acquire goods and services; and basic
cash management services like check cashing and foreign currency exchange.
These institutions consist of finance companies, investment companies,
investment banks, insurance companies, pension funds mortgage companies,
and real estate investment trusts.
(MBA)
Page 14
(MBA)
Page 15
HISTORY OF NATIONAL BANK OF PAKISTAN

The normal procedure of establishing a banking company under the Companies
Law was set aside and the Bank was established through an Ordinance due
to the crisis situation that had developed with regard to financing of jute
Trade. The Bank started its operations from November 20, 1949 at six
important jute centers then East Pakistan and directed its resources in
financing of jute crop. The Banks Karachi and Lahore offices were later
opened in December 1949.
State bank of Pakistan after its creation demanded from the Indian Reserve Bank
the assets against the Indian currency retired from Pakistan country.
Government of India refuses to hand over the assets worth about five hundred
million rupees. The dispute is still troubled and these assets are still not delivered
to Pakistan. Until June 1950, the Bank was engaged on jute operation.
Thereafter, it has felt that it could expand its business to include other
commodities as well. Bank took big stride in 1952, when it replaced the Imperial
Bank of India, as an agent of State Bank of Pakistan.
With the passage of time its functioning diversify as they take over the function
of different institution with the passage of time like in past they have taken the
function of Imperial bank of India and now of NDFC (national development
finance corporation)
(MBA)
Page 16

It is also working as the agent of the state bank of Pakistan and performs its
functions where the state bank of Pakistan is not present.
The government floated its 10 % of the shares in the open market in past and the
ratio became 60: 40 and in future they trying to make it 55: 45.
In 1999 national bank celebrated its golden jubilee during the last fifty years bank
has made significant strides in the financial services industry in Pakistan.
In 1999 its market share was around 22% and it remains the largest financial
institution in Pakistan.
Nature of organization:
NBP was established under the NBP ordinance, 1949 and it is listed on all the
stock exchanges of Pakistan. It is registered and head office is situated in
Chandigarh road Karachi. The bank is engaged in providing commercial banking
and related services in Pakistan and overseas.
Branch Network
With the geographical development of its branches, the Bank has been able to
extend its services to a much larger number of Pakistanis all over the country.
Today it has 8.5 million accounts. Bank maintains its presence in all the major
financial centers of the world through its 15 overseas branches and 5
representative offices. Of these, three main offices have recently been set up at
(Uzbekistan), (Azerbaijan) and (Kazakhstan) to have the advantage of the
emerging opportunities in CIS countries. Bank role globally is well assist by its
network of correspondent banks located in Asia, America, Europe and Africa.
Apart from having a huge branch network, Bank is at the front position in the
acquisition and application of new technologies in every side of its banking
facilities. It has acquired lease telephone lines for on-line banking. The Bank
(MBA)
Page 17

have 12 Regional Computer Centers to cover various on-line and batch system
requirements of branches and controlling.
Oversea Branches
Domestic Branches
15OverseasBranches
29RegionalOffices
4RepresativeOffices
1,189Branches
1Subsidiary
4 Subsidiaries
1 Joint Venture
Branch Network: NBP has an extensive domestic branch network of over 1200
branches located all over Pakistan. The Bank also has a existence in 24
(MBA)
Page 18

international locations as well as in the USA, United Kingdom, Europe and the
Far East.
BRANCHES ALL OVER THE COUNTRY
(MBA)
Page 19
Board of directors of National bank of Pakistan
(MBA)
Page 20

Dr. Asif A. Brohi
Chairman & President
Mr. Shahid Aziz Siddiqi
Director
Mr. Zahid Hussain
Director
Mr.Tariq Kirmani
Director
Mr. Wasiq Mahmood
Director
Syed Muhammad Ali Zamin
Director
NBP RETAIL PRODUCTS
(MBA)
Page 21
Unprecedented Safety - Unprecedented

Return
Knitting Links - AASAN Banking
Unprecedented Safety - Unprecedented Return
President's Rozgar Scheme - Easy financing

for self employment
AffordNBPe, Flexible & Convenient home

financing for all
(MBA)
Page 22
Take upto 20 Advance Salaries - AffordNBPe

Installations from 1 - 60 months
One Card does it all - ATM plus Debit Card in

one
Invest with Confidence - Marginal Finance

Facility
Meet your need for ready cash against your

idle gold jewelry with no minimum limits
Services
NBP offers:
DEMAND DRAFTS
If you are looking for a safe, speedy and reliable way to transfer money, you can
now purchase NBPs Demand Drafts at very reason NBP rates. Any person an
(MBA)
Page 23

account holder of the bank or not, can purchase a Demand Draft from a bank
branch.
MAIL TRANSFERS
shift your money safely and quickly using NBP Mail Transfer service. And also
offer the most competitive rates in the market.
PAY ORDER
NBP provides another reason to shift our money. Pay orders are a safe and easy
way to move your money from one place to another. And charges for this service
are very competitive.
LETTER OF CREDIT
NBP is commit to offering its business customers the widest range of options in
the part of money transfer. If you are a commercial enterprise then Letter of
Credit service is just what you are looking for. With competitive rates, security,
and easiness of transaction, NBP Letters of Credit are the best way to do
business transactions.
COMMERCIAL FINANCE
NBP dedicated team of professionals accurately understands the needs of
professionals, agriculturists, large and small business and other segments of the
economy. They are the customers best source in making NBPs products and
services work for them.
FOREIGN REMITTANCES
(MBA)
Page 24

To help its customers in the area of Home Remittances, National Bank of
Pakistan has taken a number of procedures to:
Increase the home remittances through the banking system.
Meet the SBP instructions for timely and on time delivery of remittances to
the beneficiaries
SWIFT SYSTEM
The
SWIFT
system
(Society
for
Worldwide
Inter
bank
Financial
Telecommunication) has been introduced for quick services in the area of home
remittances. The system has built-in characteristics of computerized test keys,
which eliminate the manual application of tests that often the reason for delay in
the payment of home remittances.
SHORT TERM INVESTMENTS

NBP also offers excellent rates of profit on all its short term investment accounts.
Whether you are looking to invest for 3 months or 1 year, NBPs rates
of profit are extremely attractive, along with the security and service only NBP
can provide
AGRICULTURAL FINANCE
(MBA)
Page 25

NBP provides Agricultural Finance to solidify faith, commitment and pride of
farmers who produce some of the best agricultural products in the World.
CORPORATE FINANCE
Working Capital and Short Term Loans
NBP specializes in providing Project Finance Export Refinance to exporters
Pre-shipment and Post-shipment financing to exporters Running finance
Cash Finance Small Finance Discounting & Bills Purchased Export Bills
Purchased / Pre-shipment / Post Shipment Agricultural Production Loans
Awards and success of national bank of Pakistan
Bank of the year 2001 2002, 2004, and 2005 by the banker
management London.
Best bank of Pakistan 2005, on the Global finance.
(MBA)
Page 26

Also one of the best banks in the emerging markets, global
finance, May 2003.

Kissan time awards-2005 for NBPs services in the
agriculture sectors.
10th best bank in terms of profit on capital in the world, the
bank july 2005.
PEST ANALYSIS
Political:
Privatization policy and deregulation.
Impact of subsidize credit affecting and NCBs.
Include employment practices, Unions, Associations.
Political interfering and harassment.
(MBA)
Page 27

Incidents of high taxation on the banking industry .
Economical:
Constraints in mobilization of public savings because of
inflation.
Include Staff cost.
Also include the Operating cost.
Bad debts
Social & Cultural:

Inadequate human resources.
Cultural pull to savings.
Declining education and work moral values.
Inadequate accountability.
The adequate empowerment.
Technological:
Inadequate communication infrastructure.
Have Inadequate computer facilities.
Inadequate IT training.
Economic contribution of national bank of pakistan

National bank of Pakistan plays an important role in economic development of
Pakistan. Establish in 1949, the government controlled National Bank of Pakistan
(MBA)
Page 28

has played a very important role as a commercial bank and also as a trustee of
public finance.
Operating through a network of 1445 domestic and 23 abroad branches it has
been at the front position of national economic development. Its role in the
development of small and medium size entrepreneurs is significant. It is
attributed with introducing such new schemes as People's Credit Scheme (1960),
supervised agricultural credit programme (1972).
The national bank of Pakistan always collect savings from the people and
mobilize saving for investment in industrial project. The investors likely to borrow
from National bank of Pakistan to finance the projects. Its also Promote the
growth rate through the reorientation of loan policy. The national bank of Pakistan
provides
guarantee
for
industrial
loan
from
international
agencies
besides normal banking the national bank of Pakistan perform agency services
for the client. National bank of Pakistan saves the time and energy of busy
peoples.
National banks of Pakistan also arrange foreign exchange for the business
transaction with other countries.
Mission Statement of National Bank of Pakistan
(MBA)
Page 29
To be recognized in the market place by introducing a value &

performance culture, Creating a powerful & unique brand
identity, Achieving top-tier financial performance, and Adopting
& living out our ethics and values
Objectives of National Bank

Objectives are ends towards which an enterprise activity is aimed. The basic
purpose of business is production and marketing of economic goods and
services .National bank of Pakistan has definite objectives. These objectives are
(1) Advancing loans
(2) Accept deposits
(3) Remitting of funds
(4) Sale of promissory notes
(5) Investment or underwriting of stocks
(1)Advancing loans:
One of the main objective of NBP is advancing loans to industrialists and traders
against security of stock, debentures or other securities
(2)Accept deposits:
Bank provides deposit facility to its customers. The types of deposits are
(MBA)
Page 30
Profit and loss saving accounts

Fixed account
Current account
(3)Remitting of funds:
The bank provides the facility to its customers remitting large amounts of money
in the form of bank Drafts, Telegraphic Transfer, Mail Transfer to where ever the
customers want.
(4)Sale of promissory notes:

To sell and realize the proceeds of sale of any promissory notes, debentures,
stock receipts, bounds, shares etc.
(5)Investment or underwriting of stocks

To invest the funds of the bank in or the underwriting of any of stocks, funds,
shares securities, debentures, bonds or scripts or other securities for money
issued by any public limited companies and to convert them into money when
required.
(MBA)
Page 31
ORGANOGRAM OF NATIONAL BANK OF PKAISTAN

PRESIDENT & CHAIRMAN
CHIEF REPRESENTATIVE
(MBA)
Page 32

PSO & SECRETARIAT
BOARD OF
DIRECTOR
SECRETARY
OPERATION
COMMITTEE
CREDIT
COMMITT
EE
ASSET &
LIABILITY
COM
FINANCE GROUP
OPERATIONS GROUP
REGIONAL
OPERATION
OFFICERS
OPERATION
DEPARTME
NT HEAD
OFFICE
IT OPERATIONS
& SERVICES
REGIONAL
COMPUTER
CENTERS
SWIFT
CENTERS
ATM
LOGISTICS
SUPPORT
ENGINEERING
GENERAL
SERVICES
SECURITY
STAFF
WELFARE
SPORTS
FINANCE &
ACCOUNTS
DEPT
EMPLOYEE
INSURANCE
PENSION
RETIREMEN
T BENEFIT
PROVIDENT
FUND
CORPORATE
INVESTMEN
T BANKING
GROUP
MAIN BRANCHES OF NATIONAL BANK OF PAKISTAN .

Head Office Address : NBP Building, chundrigar Road, Karachi.
Phone +92-21-9212100, Toll Free 0800-8008
(MBA)
Page 33
Regional Office Address: District Courts, D.I.G. Chowk ,Bahawalpur

Phone +92-62-9250121
Regional Office Address: Jail Road, Civil Lines, Faisalabad.
Phone +92-41-610534, 610535, 610536, 611044, 614829
Regional Office Address: Small Industrial Estate, Gujranwala
Phone +92-55-9200350
Regional Office Address: Opp Eat More Restaurant, Sialkot Cantt
Phone +92-52-260995, 266295
Regional Office Address: Civic Centre Branch. G-6, Islamabad.
Phone +92-51-9201973
Regional Office Address: Liberty Market, Gulberg, Lahore.
Phone +92-42-35751104, 35751105
Regional Office Address: Main Branch, Shahrah-e-Quiad-e-Azam Rd, Lahore.
Phone +92-42-9211674, 9211686
Regional Office Address: Cantt Board Building, The Mall, Rawalpindi.
Phone +92-51-927277
Comments on the organizational structure
(MBA)
Page 34

National bank of Pakistan have great contribution towards building wide
banking structure in Pakistan and serving all aspects of the national life and
all classes of society. National bank of Pakistan is fully aware of the
development of taking place in the world as well as changing occur in the
economic and social condition within the country the bank is determine to
meet new challenge by redefining its goals and strategy.
(MBA)
Page 35
Departments in National Bank Main Branch

Following departments are working in NBP main branch
(MBA)
Page 36
Foreign Exchange
Import and Export

Credit and Advances
Remittances and Deposits
Accounts
Computer
Government
Consumer retailing
FOREIGN EXCHANGE DEPARTMENT
Foreign exchange is an essential department in bank system. In the foreign exchange
department all the operations of the bank are done in the same way like in all other
departments of the bank this department also involve in the deposits, remittances and
advances but the difference with other departments that the foreign exchange department
deals in foreign currency rather then in local currency. For opening of account in foreign
exchange department the minimum balance required is $100. In this department, the
dealing is made in the foreign currency.
In National Bank of Pakistan, four currency accounts are available:
(MBA)
Page 37

US Dollar
Pound Sterling
Japanese Yen
Euro
FUNCTIONS
The department performs the following functions:
Account opening
Account closing
Inward/outward remittance
Issuance of traveler cheques
ACCOUNT OPENING
Terms and conditions:
Account opening requires two things
1) National id card of the customer and introducer
2) Introducer
CUSTOMER:
Customer is the person who comes with the purpose of opening the account
Procedure of Account Opening and Depositing Foreign

Exchange:
(MBA)
Page 38

Initially the customer is required to fill an application form. Then he/she attaches
the photocopy of his/her identity card and fills the signatory cards. Then he/she
is givenan account number by entering in the account opening register. Now
he/she fills the pay-in slip and deposits money on the counter.
Following things are needed for opening of account:

Account opening form
Signature card
Letter of kinship
Letter of thanks
Issuances of cheques book.
Account opening form:
Account opening form consist of
Category of account
Currency
Title of account
Account number
Customer information
Initial deposit
Authorized person in case of customer death
Signature card:
The signature card included the name and specimen signature of the customer
(MBA)
Page 39

Letter of kinship:
In the latter of kinship the customer authorized the bank to pay the proceedings
of his/her PLS/Current foreign currency account to the related person by
describing the relationship of the person with the customer after the death of the
customer.
Letter of thanks:
Letter of thanks is the latter issued by the bank to the customer for two purposes
1) 1st purpose is to say thanks to the customer for opening the account
in their bank
2) 2nd purpose is to confirm the address provided by the customer
while opening the account.
Issuance of cheque books:

Cheque book is issued to the customer after sending letter of thanks when the
customer comes with latter of thanks and the requests for the issuance of the
cheque book. A cheque book (usually have 25 leaves) is issued to the customer.
Closing of Account:
The customer can close the account. The customer is required to submit an
application form for closing the account.
The account is closed out and his
balance is paid to him after deducting the closing charges, $ 20 and the
application is filed in account closing file.
There are many reasons for closing of account

Account holder Owen request
(MBA)
Page 40

Death of account holder
Closing of account due to the bad manners of account holder
Inward/Outward Remittances
The remittances are of following types:
Foreign Telegraphic Transfer (FTT)

Foreign Demand Draft (FDD)
Foreign mail transfer(FMT)
SWIFT
Western union money transfer(WUMT)
Foreign Exchange Bearer Certificates (FEBC)
Foreign Telegraphic Transfer:

This is telegraphic transfer just like ordinary local currency TT, but this is foreign
currency. Its charges are fixed, i.e., if payment is in cash, charges are Rs. 1500.
If payment is through account, Rs. 1200; if deposit is above Rs. 50,000 charges
are Rs. 600.
NBP has its correspondent bank in New York . NBP gives credit to main office
Karachi, which gives credit to NPB New York, which gives credit to NPB, which
ultimately gives credit to required destined bank and account number.
Foreign Demand Draft:

Foreign Demand draft is also called FDD. A person who wishes to remit money
to someone in another place may if he does not send his own cheques, obtain
from his bank a draft on demand payable to the person who is to be paid the
(MBA)
Page 41

money. It may be the drawn upon one of the bankers own branches, or upon
some other banks where exists for draft to be drawn.
Foreign Mail Transfer:

These are also known as FMT. Transfer by mail of an account of currency to
another country. The Remitter sign auroras requesting the banker to transfer the
amount by mail, giving the name and address of the payee.
Foreign Bills for Collection:

Under this head, all foreign cheques are included whose payments are to be
received from abroad.
When a customer asks the bank for collection, the cheques is sent to the bank on
which is drawn.
Then on the receipt of advice from abroad, the customers
account is credited in
the bank and debit the Main Office Karachi account. The bank charges $10 or
the equivalent amount in rupees.
Foreign Exchange Bearer Certificates (FEBC):

Foreign Exchange Bearer Certificates can only be issued from Foreign Currency
Account and not from deposit of local currency. The maturity period of these
certificates are 5 years, 7 years and 9 years. It can be issued and enchased only
in rupees.
SWIFT:
The
SWIFT
system
(Society
for
Worldwide
Inter
bank
Financial
Telecommunication) has been introduced for the quick services in the area of
home remittances. The system has built-in characteristics of computerized test
keys, which eliminates the manual application of tests that often cause delay in
the payments of home remittances.
(MBA)
Page 42

The system works like Internet communication processes. The headquarter of
SWIFT is in the Belgium. The sending process is more secure where two officers
make the transmission of the message, one types the content with his code word
and the other executes it with his password. Using the NBP network of branches,
we can safely and speedily transfer money for our business and personal needs.
Western Union Money Transfer:

Western union money transfer is a fastest way to receive money worldwide. It is
working in almost the 200 countries. Different Governments. and the private
organizations are dealing with WUMT
Govt. organizations like banks.
IMPORT AND EXPORT DEPARTMENAT
Export Section
A term used for goods and articles commodities sent from the country to another.
Exports in Pakistan are done by the following four modes. These modes are
(MBA)
Page 43

ADVANCE PAYMENT
DOCUMENT AGAINST ACCEPTANCE (D/A)
COLLECTION
UNDER L.C.
ADVANCE PAYMENT:
In this type of export the importer is making the payment in advance. This shows
the height of confidence between importers after the shipment is completed then
the bank sends and E-form to SBP stating the export being made.
DOCUMENT AGAINST ACCEPTANCE (D/A):

Consignment is given to the auction house with out any order. A trust receipt is
being made issued. Amount is given to the exporter when the goods are being
sold or if the auction houses are not able to give the exporter the required money
then gave to return the goods in full to the exporter. This payment is made after a
specific period of time on which both the parties had agreed i.e. 30, 60, 90, 120,
180,days.
COLLECTION:
Under this type of exports, bank has no liability, buyer and seller sets the rules for
this type of export. Only documents are rooted through the bank and also
(MBA)
Page 44

payment is received through the bank. It is done with the prior arrangement
between the buyer and seller firm order. Payment is made by the draft, when the
bank received the documents through other bank the payment is made.
The exporter produces the following documents with the bank at the time of
export.
Export license
Covering schedule
Covering letter (document are received)
Airway bill or bill of lading
Invoice
Packing list
Certificate of chamber of commerce
Insurance of goods
E form
In this type of export payment can be made in parts.
UNDER L.C:
Bank receives an L.C from the importer for exporter of goods. These export LC
used in Pakistan are following two types.
1) SIGHT L.Cs
2) USANCE OR D/A LCS
(MBA)
Page 45

Exporters provide the following documents to the bank.
Bill of lading or air way bill
Invoice
Packing list
Certificate of chamber of commerce
Insurance
E form
The bank informs SBP about current export uses the E form. The custom
authorities retain first spy of E-form and returned SBP, .2 nd copy is for SBP 3rd for
exporter and 4th for the banks record. When full payment is being made the
SBPs copy is returned to SBP. After receiving their copy SBP compares the two
forms.
IMPORT SECTION
Letter of Credit
A letter of credit is defined as under
Undertaking by the importers bank to exporter that the draw in accordance with
terms and conditions of the credit will be honored if presented with in the validity
of the credit.
It is a conditional undertaking by the Bank to make payment to the exporter if he
fulfills the terms of credit by presenting the required documents to the bank in his
country. In fact LC is a legal document on behalf on which the payment made by
the importers bank to the exporters bank.
(MBA)
Page 46

National Bank of Pakistan is providing this service to its customers who have an
account with the branch and other businessmen too.
Information in LC document
The name of the local company, which is importing the goods
The name of foreign company, which is exporting the goods
The details of the goods to be transacted including the amount, quality, mode
of packing etc.
The total amount of the LC
The number of days for which the LC is valid
The name of the banks, who are regulating all these dealings
The name of the carrier which will be used for the shipment of the goods to
the importer
The bill of shipment number
Parties involved in a letter of credit

There are normally six parties involved in a letter of credit:
Buyer (known as the importer or consignee)
Buyers Bank (known as opening, or paying bank)
Seller (known as the exporter, or beneficiary)
Sellers bank (known as advising, confirming, negotiating bank)
Carrier (known as the shipping company)
Insurance Company
Remittances under LC
The advising bank gives the authority to the negotiating bank to get money from
their account from of their branches. If the bank has no account with the
(MBA)
Page 47

negotiating bank or the currency of the amount in the LC is different from that of
the official country currency. Then the advising bank issues a debit authority letter
to the negotiating bank to get the money from that bank and authorize the bank
make payment to the negotiating bank.
Reporting To the SBP

After an import transaction is completed then the officer uses a form to report to
the SBP for that import. This I form is issued in quadruplicate. One of its copies is
sent to the SBP. Other copies are for bill of entry 2 national bank of Pakistan
copies. This form contains the information about the import against an L.C for
example description of goods their quantity amount of LC shipment date of
shipment
vessel
and
etc.
Requirement for Imports

1. Annexure A (request for opening LC)
2. Invoice Performa ( by beneficiary)
3. Limit sanction certificate.
4. Valid import license (not necessary)
5. NID Card of the importer.
6. The Insurance Certificate
7. The Bill of Exchange
8. The Bill of Lading
GENERAL BANKING
(MBA)
Page 48

General banking area is also called the operations group. It consist on the
following sections
ACCOUNTS SECTION
REMITTANCES
CLEARING SYSTEM
GOVERNMENT RECEIPTS
CONSUMER AND RETAIL BANKING
LOCKERS
Accounts section
Accounts Department of the bank can be considered the most important
department. This department is basically the concerned with processes and
activities of recovering, sorting, summarizing and reporting data resulting from
the whole day transactions of all departments.
Actually the process of this
activity starts from the preparation of all the required vouchers by different related
departments.
When these vouchers are prepared, these are posted into
respective computer terminals by the relevant departments. Before merging, a

batch list is printed out by Computer Department and duly checked by the
respective departments. After this, merging stage comes, after which a proof list
is printed out. This is the stage, where Accounts Department starts performing
its function. Proof list is checked by the Accounts Department.
This section performs the following functions:

Opening of Accounts
Issuance of cheque books
(MBA)
Page 49

Closing of accounts
Payment of Cheques
Types of accounts
Following types of accounts are open in NBP
Saving account
Current or demand account
Fixed account
Procedure for Opening an Account

First of all, the customer gets an application from the bank, which requires all
information necessary for opening account and also the documents required. An
account can be opened as:
1) An individual account
2) Joint account
3) Proprietorship account
4) Limited company account
5) Partnership
6) Club, society, association and trust
Information Required by the Bank

Name
Address
(MBA)
Page 50

Telephone No.
Currency of Account
Nature of Business
Country of Residency
Special instructions regarding the account
Signatures
Documentation In case of limited company accounts:

Photocopy of National Identity Card of each director
Application form
Copy of companys memorandum and articles of association
List of directors
Copy of board resolution
Certificate of incorporation
Their signature cards
Certificate to commence business
Documentation In case of Partnership Account

Application form
A copy of partnership deed
Signature cards of partners
Registration certificate copy
A copy of National Identity Card of each partner
Documentation In case of Club, Society, Association or Trust

Application form
Copy of rules
Certified copy of resolution
Signature cards
(MBA)
Page 51
When the concerned officer is satisfy then he opens the account and gives an
account number that will be used in all communications with the bank regarding
to the account and when making deposits and withdrawals.
Bank has the right not to open an account without assigning the any reason or to
close the account if it is not operating in a satisfactory manner by the instructions
of the head office.
Issuance of Cheque Book

After opening the account, a cheque book is given to the customer to sign upon
which the number of cheque book issued and the name of the customer is
written. Bank issues a cheque book against requisition. A cheque book may be
of 20 (PLS), 25, 50 or 100 leave (current A/C). Rs. 4.50 per leaf as excise duty is
charged to the customer.
A cheque book register is maintained by the office. In this register, the cheque
book inventory, cheque books issues are recorded.
Payment of Cheques
It is banks primary function to repay the money required for its customers
account usually by honoring his cheques.
It is a contractual obligation of a
banker to honor its customers cheque if the following essential are fulfilled:
Cheque should be drawn in this particular branch
Cheque should not be damaged
No unauthorized material alterations
Funds must be sufficiently available
Cheque should not be post date or stale
Procedure for Closing an Account

The customer can close the account.
Customer is required to submit an
application form for closing the account. Then the account is closed out and his
(MBA)
Page 52

balance is paid to him after deducting the closing charges. 200 Rs and the
application is filed in Account Closing File. Remaining leaves of cheques will
also be collected from the customer.
The activities of Accounts Department can further be divided as:
Routing of expenses vouchers
Preparation of daily activity reports
Preparation of weekly and monthly statements
Preparation of statements for tax purpose.
Routing of Expenses
Vouchers of all expenses and material purchases are routed out through this
department. As far as the expenses are concerned, they include the heads of
salaries paid to confirmed employees of bank, wages paid to employees that are
on contractual basis, rent of the building, lease installment and insurance
premium paid to insurance company for the insurance of vehicles and cash in
safe and counter. Expenses also include the utility bill,
Which consists of courier, electricity, water and gas bills, medical expenses,
which are reimbursed.
Preparation of Daily Activity Reports

As far as the daily activity reports of this department are concerned, these
include the following heads:
Voucher collecting of
Loan transactions
General ledger transactions
Foreign currency related transactions
(MBA)
Page 53
Fixed deposit related transactions
Preparation of Daily, Weekly Monthly and Annual Statements:

Daily Statements
These statements are sent daily to Main Office Karachi. These are:
Daily Affair Statement, which is same as Balance Sheet
Statement of Income and Expenditure, which includes the details of income
generated and expenses incurred by the bank.
Weekly Statements
These statements are generated on weekly basis for the purpose of sending it to
Head Office. These also include:
Statement of affair
Deposit and advances position of the bank
Monthly Statements
These statements are prepared on monthly basis and also sent to Head Office
(Qatar). These include:
Provisional statement of income and expenses. This statement adjusted for
accruals and pre-payments.
Monthly Balance Sheet and Income Statement
Comparative Statement
(MBA)
Page 54
Statements for Tax Purpose

The department also prepares two statements for the purpose of paying tax on
monthly and annual basis. These statements are generated for the purpose of
submitting to Central Board of Revenue. These are:
Statement of deduction of income chargeable under the head salary under

Section 53 (Tax deducted at source)
Withholding Tax from the payments made to vendors, suppliers and other
parties providing various services. The rate of withholding tax is as follows:
Suppliers
2.5%
For other parties
5%
Lockers service
National bank of Pakistan also provides lockers facility in the country. The lockers
issued only to the depositors. No lockers are issued to any unknown person. The
dual control system is used for lockers. The officer has master key to apply on
the locker but he cannot open the locker of any person. The locker holder
provides the bank has specimen
(MBA)
Page 55

signature. Whenever the locker holders come to open the locker, his signatures
are verified by the officer and then will be able to open his locker.
Billing and Government Receipt/Payment

This department is performing following functions
Collection of utility bills
Collection of dues of education institution
Payment of salaries
Payment of zakat
Payment of pension
Clearing Department
The main function of Clearing Department is to receive the cheques, which are
drawn on some other bank. The customer can get the money in his/her account
at NBP, from the cheques drawn on another bank. The bank accepted these
cheques and collects the amount from that bank on which cheque is drawn
through the Clearing House.
Bank also charges some commission for this
function.
(MBA)
Page 56
Procedure for Clearing the Cheques

Pay-in Slip
The customer fills pay-in slip. This slip is just like the deposit slip. The cheque
number, date, amount and account number have to written on this slip.
The Stamping and Scrutinizing

The officer on the receipt of cheques and pay-in slip will stamp the pay-in slip
with cheque received and give a portion of slip to the customer and the
remaining portion is attached with the original cheque.
The original cheque is the marked with two stamps.
Clearing Stamp
Consumer and retail banking section

Consumer and retail banking department is offering two facilities to their
customers
1) NBP Advance Salary
2) NBP Ghar Ghar Television
NBP Advance salary

NBP advance salary facility allows you to draw three months salary in one go.
(MBA)
Page 57
NBP advance salary offers you

Take up to three months advance salary take home
Fastest processing and immediate disbursement
Easiest facility for 1 to 36 months
Minimum documentation
Those who qualify for this scheme should have:
Three years of service age remaining
Salary account at NBP
Limit of Finance
Three net take home salary
Customer must have account with national bank which show last three
months salary in his/her account
Calculation of limit
Average of three months and minimum salary which ever is less taken it as base
and multiply it by three
Maximum duration of loan

Three years is max duration.
Requirements
Requirements are
(MBA)
Page 58
Three months salary certificate

NIC photocopy
Auto roll over form
Application form
Three undated cheques
Account opening form
Procedure
After filling the application customer signed it with his salary-disbursing officer
then under taking is officer approving it. Open the account that is calls separate
loan account, which is once Debit and many time credit.
NBP Ghar Ghar Television

NBP offering the customer to get the television on lease base
Eligibility
Four categories are there
1) Lean of account
2) Lean of guarantor account
3) National saving certificates
4) Guarantor of NBP
(MBA)
Page 59
Lean of account
Here the amount of customer account is pledge and customer cant DR it until
the expiry of limit
Lean of guarantor account

The person who is taken the guarantee of that customer his account is marked
as lean and pledges it until the expiry of installments
National saving certificates

Three types of certificates
a) Defense saving certificates
b) Special saving certificates
c) Regular saving certificates
Every certificate having their face value. The 75% of that valve is marked as
lean.
Guarantor of NBP
The employee of national bank can give the guarantee of that customer. The
procedure is same his or her account is marked as lean
Duration of scheme
Two types of duration
For one year
For two year
(MBA)
Page 60
Product supply
Product is supply by L.G electronic at the customer address
Products
Different products are offered by L.G such as
Television
Monitors
Air conditioner
DVD
VCD
Documents
Documents required by the banks are
a) Application form
b) IB-12
c) NIC photocopy
d) Delivery order
e) Agreement
(MBA)
Page 61

f) Letter of hypothecation
g) Adamantly bound
h) Letter of acceptation and satisfaction
(MBA)
Page 62
Business volume:
NBP is the foremost bank determined to set higher standard of achievement .It
is the key business partner of Govt. of Pakistan with special emphasis on
economic growth through aggressive and partial lending policies. The main
function of NBP is to provide the commercial banking and related services in
Pakistan and abroad. Its also handles the treasury transactions for Govt of
Pakistan as an agent to state bank of Pakistan. It also provides the internet
banking and moreover they have recently set up the financial institution wing.
(MBA)
Page 63

The role of the wing is effectively managing the NBP associations with the
correspondents to support trade and treasury and other key business areas
thereby contributing the bank productivity.
Ownership:
NBP 100% owner by the Govt. of Pakistan.
Deposits:
NBP holds 24.6% share of time and demand deposits in the country. Local
currency deposits comprise 67% of banks total deposits while foreign currency
deposit account for the rest.
Assets:
NBP total assets stood at 350 billion in Dec 2001. This include total earning
assets of 268 billion with gross loan portfolio of 140 billion. The bank also have
investment portfolio of 91 billion.
FINANCIAL ANALYSIS FOR BANK

Financial year
The financial year of the Bank commences from the 1st day of January and ends
on the 31st day of December every year.
Non-performing loans
As on 31 December 2002, the Bank's non-performing loans (NPLs) amounted to
Rs. 30,323 million, which was 19.11% of total advances as against 21.48% as on
(MBA)
Page 64

31 December 1999, showing an improvement of 2.37%. Provision against nonperforming advances was Rs 18,296 million as on 31 December 2000, which is
60.34% of NPLs.
This high ratio reflects care of the Bank's management while determining
provisions. Remaining NPLs are covered by forced sales value of mortgaged
property, Federal Government Guarantee is in category other than loss.
The Special Assets Group at Head Office with full co-ordination between field
functionaries and Head Office is monitoring NPLs and deals with the classified
portfolio of the Bank along with Remedial Management, Legal framework,
Statistical Analysis of classified accounts, Revival of Sick Industrial Units,
Consortium Financing and Ex-Mehran Bank Limited affairs etc.
(MBA)
Page 65
Five Year Performance
Years
Total assets
Deposits
2008
817,758
2009
944,583
727,465
475,243
1,037,750
832,152
477,507
2010
2011
2012
(MBA)
1,149,578
1,309,339
624,939
Advances
412,987
Investments
170,822
217,643
301,324
Equity
81,367
94,142
103,762
927,421
525,046
319,531
110,520
1,037,785
657,381
343,538
116,035
Page 66
(MBA)
Page 67

This chapter is based on my observation and experience during my internship in
National Bank of Pakistan, Qila Didar Singh
First and Second week.

Account opening department
My experience in this department was really very good. I learnt how to handle
different customers, how to fill Account Opening Form, what are the required
documents that should be with you in order to open an account, what types of
account national bank of Pakistan is offering to the customers, what are the
facilities that an account Holder can enjoy and what are the profit rates Bank is
giving to its customers. I have learnt the procedure that an Account Opening
Officer has to follow in order to open and maintain an Account.
In my first two week I worked on opening of account. In these weeks I learnt how
to open an account in the branch, it is a procedure and after it bank open an
account.
In first week in account opening department I learnt
Account opening procedure
The persons who are eligible to open an A/C

Kinds of A/C offered by NBP
Documents required by different categories of persons.
In second week I learnt about:
Preparation of debit and credit vouchers
Details about loose cheques
Procedure of closing an A/C
Accounts Opening:
(MBA)
Page 68
During my training in that department I was trained that how to open the account
of the customers in the bank. That when a customer comes how he/she should
be explained about the types of accounts and the benefits providing in each
Account. My supervisor used to toldl me that how to fill the form of account
Opening, and which documents are required for opening the account, the
informations and all.
But I did not have the opportunity to enter the accounts open on daily bases in
the software system because its a very sensitive issue and I was not so much
trained thats why I have used to only fill the forms and do stamping on them.
At NBP its very easy to open an account just an introducer and a copy of NIC is
required. Customer just needs to fill up account opening forms and can enjoy the
facilities of any type of account the want. This is the strength of NBP facilitates all
of its customers.
Documents require for opening an account:

This form contains:
A signature card
Requisition slip
The main account opening form
Acknowledgement
Know your customer profile
These all forms will be filled by the customer and following things will be required
from the customer to attach with this form:
A copy of NIC
A copy of job evidence or contract or student id card copy
(MBA)
Page 69
If the customer wants to change his signature on the account opening

form then
he has to fill another form.
The minimum amount of money for opening account is Rs: 100, which
have to be deposited by the customer at the time of account opening.
Those people who are not educated do not need to do a sign; they can
give their thumb impressions instead of Signatures.
After a few days the Bank sends or mails another copy of Letter of thanks
to the customer as well.
THE TYPES OF ACCOUNTS

The different types of accounts offered by NBP are:
1. PLS saving account (profit and loss saving account):
2. Current account:
CURRENT ACCOUNT:
NBP offers current account facility for individuals as well as institutions and
Commercial customers. Current accounts are also called demand liability on
current deposits. NBP practically pays no interest on current deposits.
Businessmen usually open current
NBP offers PLS savings account accounts. In National bank of Pakistan current
account can be opened with a minimum amount of Rs.100.
PLS SAVING ACCOUNT:

Profit and loss sharing deposits (PLS) are also called checking accounts. Any
one can deposit and draw money easily. The profit on PLS is calculated every
(MBA)
Page 70

month but paid after six months. PLS account can be open with a minimum
amount of Rs.100.
REASON FOR CLOSING THE CUSTOMERS ACCOUNT:

The banker may close the account of the customer due to following reasons:
i.
On the Customer Request
ii.
On the Death of a Customer
iii.
On the Court order
iv.
Having zero balance till six months.
Procedure for closing the account:

1. I also learnt about how to closing the account for this first write a check for the
amount you believe remains in your checking account, assuming that you
keep good records. You can check your balance in your check register.
Theoretically, the figure there will include the checks you have written newly
that may have not cleared the bank. However, if you have made an error and
you write a cheque that will exceed your balance, it will either be returned for
insufficient funds or it will be paid, thus creating an overdraft. In both cases,
you will be charge a substantial fee.
2. Stop writing checks against the checking account about two weeks before
you normally received a bank statement. When it arrive, the chances are
good that the balance that it shows is the amount you should withdraw. Then
write a check for that balance, which should brings your account to zero.
3. Make a request to bank, in writing that it send you a cashier's check for the
remaining balance of your checking and savings accounts because you want
to close them. If possible, tell the bank threat what checks you believe are
outstanding so it will know when they clear your checking account. Finally, tell
(MBA)
Page 71

the bank not to honour any further automatic withdrawals from your checking
account. This is the best way to close the accounts because the bank will be
properly notified and it won't continue to impose service charges, and it will
update the interest on your savings account.
THIRD WEEK
CHEQUE BOOKS .
(MBA)
Page 72

I also spent one week in this department. I learned to send cheques book. And I
also learned to issue them cheques books.. Whenever any customer used to
come to collect his or her cheques book then I used to take his sign on the record
register, do stamping, write date of issuance, match his sign with sign card and
then provide him his cheques book. It was also my duty to explain him the
working method, so that if any customer had any question in his mind he could
ask me the details.
CHEQUE BOOK :
My supervisor told me that cheque books are issued after three days of opening
of account, Books reissued on request of the customer. Customer has to
submitted a request form for issuance of another cheque book. There are many
types of cheque books, the first one is of 100 leaves and the second one is of 75
leaves and third one is25 leaves & last one is of 10 leaves.
ISSUENCE OF CHEQUE BOOK:

Whenever a person opens an account with NPB, then he is issued a cheque
book.But for his purpose he has to fill a requisition slip, and then he gets his
(MBA)
Page 73

cheque book. There is also another requisition slip inside each cheque book,
which is used for the purpose of reissuance of a new cheque book if the leaves
of first cheque book start finishing. There is written the title of account holder, his
account number, the stamp of NBP and the A/C of the person on every page of
cheque book and also on the requisition slip.
Fourth week
Credit department:
(MBA)
Page 74

In my fourth week in NBP, they assign me worked in credit department. During
that period I was performed duties as to fill legal documents .This department
supervise the loans either given or received in the form of deposits. It administers
the conditions imposed at the time of delivering of loan like security either in form
of physical goods or either any personal verification etc.
Credit and Advances Department deals with the provision of loans to the
customers. At NBP, credit is given on the basis of a policy made by Board of
Directors and is called Credit Policy.
This policy statement sets out the
underlying principles from which the BOD will determine the commercial credit
activity of NBP. The committee to approve and review commercial lending of
Bank and to ensure that credit policies are adhered to and the credit operation is
conducted in an efficient and effective manner. Main purpose of this policy is to
set out the credit policies for the boar, which will be implemented by the Credit
Committee. The policies are described under the following readings:
Credit principles
Portfolio limits
Approval
Administration
Monitoring and review
(MBA)
Page 75
1. CREDIT PRINCIPLES
It includes principles to be adopted for lending authority, approval, monitoring and
control on a basis consistent with NBP. The operational objectives and business
strategies regarding the objectives, structure, performance and administration
are also included.
2. CREDIT PORTFOLIO
These are the guidelines set down by Credit Committee regarding:
Total facilities
Term facilities
3. CREDIT APPROVAL
When the terms and conditions are set and both parties are agreed, the Credit
committee makes approval for the credit.
4. CREDIT ADMINISTRATION
The credit application when handed over to Credit Administration, then they
critically examine securities given by client to bank against credit facilities. Credit
Administration keeps link with lawyers, surveyors, valuators and other corporate
bodies.
(MBA)
Page 76
5.CREDIT MONITORING
The client can present his/her own account insurance policy as security for credit.
When he/she presents his own account as security, his account is blocked for the
same amount, which the bank is granting him/her. When the facility is adjusted
at that time, the blocking is eliminated from the account. Clients can also use
third partys account for getting the credit.
Shares can also be kept as security in this case these are verified and properly
signed. In this department I also learnt about:
Credit facilities for customers
Long term & short term loans
Employees loan
Securities for credit
How to give credit to customers
How to prepare credit line proposal
Parts of credit file
Facilities for borrowers
How to recover the loan
Funded facilities
Non funded facilities
Letter of guarantee and its types
(MBA)
Page 77
Evaluation:
Bank makes the evaluation through recommendation person for the property
against client want for credit Evaluator must fulfill the following requirements
Integrity of the evaluator
Market reputation
Professional competencies
Relevant experience
Evaluation Report:
The evaluation report should include the following minimum details
Complete details of property and the basis of valuation
Negative and positive points pertaining to the property.
Market and forced sale vale of property.
Any other information, which in the opinion of valuator is considered to be

of significance
The cost of valuation shall be borne by the bank
Original report should be retained by the branch
Appointment of lawyer
Reputed lawyer or firm of lawyer of banks approved by the executive

committee should be hired to attend a legal formality & he should have
Professional reputation
Relevant experience
(MBA)
Page 78
Integrity of lawyer:
Appointment of income verification agency bank acquire the services from the
certified agencies for taking income verification date of client
Eligibility Criteria:
The prospective customer identified by the branches should meet the following
acceptance criteria
Age between 25 years to 65 years
Minimum household gross income of Rs 200000 or more
Monthly payment of installment should not exceed 35% of the gross

income of the customer
Payment of installment should be continued for two years or more.
All customer having a satisfactory financing relationship
High net worth of individual
Risk evaluation
It should cover following points
Verification of the customer incomes and other fact
Established consistent income flow
Established source of income
(MBA)
Page 79
High risk areas be identified
Where the amount of financing is in excess of Rs 500000/=CIB report of

the customer should be checked
Confidential report from other banks
Property is not in the name of minor
There should not be any restriction on transfer of title in the property
DOCUMENTS REQURIED:
Following documents are required to be submitted by an applicant with the
completed application form for Salaried Persons:
RESIDENT PAKISTANIS:
2 passport size photographs.
Copy of new NIC
Up to date Bank Statement for the last 6 months.
Copies of latest 6 months credit card bill
Salary Certificate (original) from the employer, showing the gross salary
and deductions.
Employment confirmation form the employer.
NON-RESIDENT PAKISTANIS - Additional documents

Copy of Pakistani Passport valid for at least next 1 year.
Copy of Contract / Work Permit / Residence Permit / etc. Copies of last 3
years Tax Returns (Not Applicable for Middle Eastern Countries)
(MBA)
Page 80
Personal Guarantee of a relative based in Pakistan and acceptable to

Bank.
Fifth week
Foreign Exchange department/Remittances
I learnt the different methods of foreign exchange, requirement of importer and
exporter before doing import and export and procedure of opening L/C, I read
L/C that helped me understand that what things would be included in it. In this
department few Customers were seen because this was a new department and it
will take time to generate profits for the bank.In first three days of fifth week there
are busiest days
I joined the foreign exchange department. On first day I learn what home
remittances (HR) are and foreign remittances (FC). How to make them and the
recording of entries in particular registers, transactions made may be in home
currency as well in foreign currency.
My supervisor told us about different currencies which are usually transacted in
foreign exchange department i.e. Euro, Pound, Dollar and Yen. Different types of
codes are assigned to these currencies. usd=1, UK=2, Euro=4, Yen=5 etc. The
rates are determined by combine efforts of the bank like there are 8 major
(MBA)
Page 81

European countries that fix the rate of currencies. All these currencies are
transacted by the agent named as intender.
Computer techniques used for L.C
Swift
Telex
Requirement to open foreign account:
Account holder CNIC card
Introduction(CNIC of introducer)
If the account holder has no link with bank for 3 years then this person will
provide information about account holder may be brother or sister cousin
or friends etc.
There are list checking of account opening form
To identify old id holder and new id holder and also those who have no
card
Counting of resident and non resident
Here i worked with who was also the head of foreign exchange department.
Inward remittances and outward remittances were discussed.
Inward remittances:
Money from foreign currency to home currency
Outward remittances:
Money from home currency to foreign currency.
Forms of inward remittance:

United States and London bank deal with NBP Pakistan when UBL want to send
money form London to MCB in Pakistan, in this case one branch of NBP receive
(MBA)
Page 82

a swift message from UBL due to agency arrangements now for dealing of NBP
and MCB. We require f-15(for same bank and different branches). But for
different banks like NBP and MCB pay order is used for it, a certain limit is fix for
pay order.
Fixed with in city
Clearing have no charges
Its a collection procedure and now a days NIFT clearing account is used with in
clearing limit drafts is used and for foreign remittances it have no charges
otherwise graft have charges. Now a days all clearings are made under NIFT.
Import and Export:

Chamber of commerce register registration is compulsory for export but optional
for imports. If we export rice then export association certificate is also required.
Letter of credit for import:

When required documents are joined with letter of credit then it becomes fund
based facility. Letter of credit is contract between import order and export order
for example between importer bank and exporter bank.Bank takes some security
as property or other material as a guarantee at the time of opening of letter of
credit. It is necessary to avoid any fraudulent from the part of importer (Mortgage
to avoid risk)..
Import form:
Signed by importer
Document necessary for Importer/Exporter
NIC Card
Current A/c of the firm (Necessary for importer)
Registration certificate of sales tax
Chamber of Commerce Certificate
(MBA)
Page 83
Sixth week
Cash department:
In sixth week I work in Cash department deals with the cash, which either comes
in the Bank or goes out side the Bank. Cash can be in any form of the currency.
Sources of the cash
There are different sources through the cash inflows the Bank. These sources
are.
1.Deposits
This is the major source of the cash inflow. When someone deposits the cash
in bank in any currency, it means that the cash is coming in the Bank.
2.Demand draft and telegraphic transfer commission
These are the second major sources of the cash inflow of the Bank. When the
Bank issues the DDs and TTs on the behalf of the customer then the Bank takes
the some charges as commission. These DDs and the TTs can be issued in any
currency on the demand of the customer.
3. Prize bonds
(MBA)
Page 84

Prize bonds are other sources of cash. These bonds are sold to the general
public and cash is received from them. Finally this cash is ultimately transferred
to SBP but still the Bank has to manage this cash.
Mangement of cash
It is necessary for every branch to maintain a specific amount of cash with it at
any time, so that when a customer comes to get cash, he may get it promptly. If
a branch is not able to maintain such suitable level if cash then it will have a
bad effect on its reputation and it will not be able to fulfill the customer
expectations. So, effective management of cash is basic and important thing for
every Bank. This limit is differ for main branch and other sub-branches.
Treatment of surplus cash
The surplus cash means the cash, which is over and above the limit of any
particular branch. It may be that a branch may have the surplus cash with it. If a
sub branch has extra cash with it than that of limit, then it will transfer it to the
main branch on daily bases.
If the main branch has the surplus limit then he will shift the surplus money to
head office in Karachi through the SBP. If these surplus funds remain with the
main branch, they have no use and will act as idle money because they are
earning no profit. So these funds are transferred to the head office, where they
are invested and will earn profit for the Bank. The main branch earns the profit
on the funds, which it transfer to the head office. At present this rate of profit is
13%. There is no profit given on the funds which the sub-branches which they
transferred to the main branch.
Treatment of cash deficit:
I also learnt hoe to treat with cash deficit in a bank. As surplus of the cash
occurs, in the same way the deficit can also be there in the Bank. It means that
(MBA)
Page 85

the cash shortage is in the branch. To cover up this shortage the patterns are
followed. If shortage is there in the sub-branch, then it may take the cash from
the main branch. If the main branch has the lack of cash, then it may take the
funds from the head office. The head office charges some rate of profit, which is
13 % on the funds, which it remits to the main branch. There is no profit charged
by the main branch on funds provided to the sub-branches.
Cash in transit
The cash, which is transferred from any sub-branch to Main branch or from main
branch to SBP is called cash in transit. There is the limit of cash in transit on
main branch. The limit is of 20 millions its mean main branch can take the cash
from any sub-branch or can transfer the cash to SBP up to the limit to the 20
millions.
Insurance of cash
All the cash of the Bank is insured. The major companies, which insure the cash
include Adamjee Insurance Corporation, General Insurance Company and East
West Insurance Company. The Central Office pays all the insurance of cash
expences.
Security arrangements
In this department I also know that few years earlier, the Bank has its own guards
for the transfer of the cash from main branch to SBP or from sub-branch to the
main branch.
But now the Bank has hired a security company for the
transmission of cash. This company is the Brinks. The commission which is

charged by Brinks Company varies from place to place and is different for
different amounts of cash.
(MBA)
Page 86
Duties:
Accomplishment
During my internship the work I that assigned to me completed by me on daily
basis and there was no work pending. This proved by my internship certificate.
New knowledge acquired

During the internship I acquired the knowledge about consumer banking. I gain
knowledge about home finance what kind of documents of financing exercising
here. What procedures have to be done for issue finance in consumer banking? I
was also gain the knowledge about he office environment and what kind of
behaviors and attitude have to be exercise in a working environment. I also
acquires the knowledge who to deal with customers and gain the marketing
knowledge.
Problem encountered.
During my internship at Qila Didar singh branch of national bank of Pakistan,
there are following problems I have found which are directly affect on efficiency
(MBA)
Page 87

and performance of the bank.
During the internship there was the major problem is that the time span is so
short and I was not able to deeply understand the system. Another reason was
that practical work was not assigned.There problems are also called as internal
problems. So these are discussing below.
Lack of communication among the employees:

During the period of my internship I found this problem as a biggest problem that,
they are not very effective in communication between themselves. They do not
share the experience with each other and do not care the other employee. If one
employee has a problem, then he asked to other, but he does not give clear
solution to that problems. They are shows the facial expressions against each
other it. They are talk against each other in front of me. So finally it is very needy
for a public services organization to keep atmosphere friendly among the
management and employees. National bank of Pakistan is lack in communication
skills among the employees.
Ineffective public dealing:

There is also a big issue that they think its governments bank so it does not care
customers. It is a wrong thinking. There must be a good public dealing in public
service organization. If one customer asked a question twice. They angry on
him and stop working. I personally experienced in cash department. The cashier
have no respect to the old customers and he used wrong wording against them
same is also happened in bills executive in bills is also angry on Customers,
when they asked question twice, so there should be solve this problem to create
a good environment of the NBP.
(MBA)
Page 88
Lack of commitment:
Lack of commitment is also a problem faced by the national bank of Pakistan
(Qila Didar singh branch)
Employees are not committed to the work and their duties. This is very common
problem.
Low Efficiency of employees:

Efficiency of employees is also low at this branch.
Not very regular and punctual:

Regularity and punctuality shows the character of a big and good executive. But
this problem is also faced by the NBP (Qila Didar singh Branch) many executive
not come at time.
Lack of computing skills:

Computing skills are also low, some executive are very efficient in computing
skills but some are not totally aware from this system.
Proper training:
During my internship in this bank, the problem which I faced that was proper
training. They do not provide the proper training to the internees. They assign the
intern only few seats in the bank.
Impact of experience on career

This internship gives me practical exposure of organization. This will help me to
fit myself in better ways in an organization. This also to some extent gives me
practical knowledge which helps me in getting a job due to understanding of
(MBA)
Page 89

system.
(MBA)
Page 90
(MBA)
Page 91
STRENGTHS WEAKNESSES OPPORTUNITIES THREATS

(SWOT) ANALYSIS
STRENGTHS
NBP has an wide domestic branch network of 1200 (according to the latest
data) branches located all over Pakistan. The Bank also has a existence in 19
international locations including the USA, United Kingdom, Europe and the
Far East.
NBP's total assets stand at Pak 370 Rs billion on December 2000. This
include total earning assets of about Pak Rs.268 billion with gross loans
portfolio of Pak 140 billion. The bank also has investment portfolio of Pak
Rs.91 billion, which comprise treasury securities, corporate bonds, shares
and other securities.
NBP cash provision as percentage of non performing loans equal to 60% this
coverage factor for the non performing loans is the highest amongst the
nationalized commercial bank.
NBP is working as right arm the government of Pakistan as it is responsible

for all claims of government for recovery as well as payment. It acts as an
agent of the Central Bank where the State Bank does not have its own
Branch.
(MBA)
Page 92
WEAKNESSES
NBP staff especially at lower considers their work as burden. They usually
waste time in other tasks in performing their duties. Using government
property for own need. They are unwilling to accept change brought by latest
restructuring efforts.
The general out look and interior layout of branches are not as required
according to modern banking
NBP bearing up large burden in running those branches, which are not
producing any income but keep on adding expenditure.
NBP is rely on its traditional sources of income it has not taken the benefit
from innovation in banking sector like introducing retail banking or consumer
banking and using any type of plan to make more deposits and producing
more advances.
NBP is far behind in offering modern banking facilities like automated teller
machines then other commercial bank in Pakistan as only eighteen branches
in all over country have this facility.
NBP has the only forty-four on line branches. While from the remaining
branches data gathering is time consuming, and not proof.
Quantum of
settlement within different branches is pending because of this updating daily

record is becoming very difficult.
Customers have to fallow long extensive procedure for opening of account as

well applying for debt. Which discourage most of the people to investing in
NBP.
(MBA)
Page 93
In NBP, most of the time merit not has any importance in hiring of employees.
Such practices are black spot on the face of bank and resulted big losses and
deceptive acts by NBP own employees.
OPPORTUNITIES
Reorganizing efforts in the NBP has open many opportunities for NBP to grow.
NBP current management has board vision. They have taken many steps to
improve customer services, streamline internal procedure and creating a
delectating climate for technology initiative.
To achieve above mention objective they have formed operation group
Starting of the retail banking initial working.
Setting of target for making at least 300 branches country wide on line.
Closing of the all those branches, which are burden on NBP.
Management to offered specialized services to major corporate including

advisory and debt syndication introduces the concept of relationship manager.
Comprehensive training programs has been develop to promote the core

banking skills of the existing staff as well as integrate high quality hiring.
To improve the motivation of staff a merit-based culture is being promote.

Through overhauling the manpower recruitment protection and performance
appraisal system.
These actions taken by the current management provide a great opportunity
for NBP for making it future prosper and can make NBP not less than any
modern commercialize bank in Pakistan.
(MBA)
Page 94
THREATS
Following are the major threats which national bank of Pakistan is facing:
Major threats NBP facing is from its competitor especially from denationalized
commercial bank. In which MCB is on top of the list, The Bank provides 24
hour banking service with the largest ATM network in Pakistan covering 15
cities with over 100 ATM locations.
Retail banking and consumer banking resulting in the products such as credit
cards, housing finance and automobile finance which are lending to small
individual consumers, and purchases of automobiles, housing, and consumer
goods are generally made on a cash basis. These are causing another threat,
if not counter will result in so much loss of customers
Recently banks and other financial institutions have introduced innovative

plans to attract deposits. These schemes offered prizes on short and long
term fixed deposits, through lucky draws.
Now banks are using the technology which covers the distance no matter how
far away any one, through a satellite based, on-line real-time banking system
and by offering telephone banking, electronic funds transfer, E-Banking and
other modern facilities.
(MBA)
Page 95
SUGGESTIONS
NBP major fault is that wasnt keep its pace with on going changing in
banking industry unlike other bank. Now this bank combine all it power and
trying to approach other banks.
Latest reorganizing efforts are necessary to make it cost effective also making
its facility according to the modern banking. These must be continue.
Bank management has to put its all efforts to change the existing culture of
the bank and to put the foundation stone of business oriented culture. In
which employees give importance to the bank and its customer.
To attract the customer in the future NBP have to make extensive effort to
give facilities of retailing and consumer banking. Plus the technology in the
banking which will be necessary for future banking is another week area need
to be worried.
The outlook and interior lay out of the branches is another thing which needs
to be enhanced.
The procedure of taking services from the bank must be made easier and
straight forward not involving long difficult method for simple task.
To remain in the market bank need to be attentive in the eyes of customer.

One way is through promotion efforts, so that people aware about he services
of the banking and any addition which the bank has made in the portfolio of its
services.
(MBA)
Page 96
CONCLUSION
National Bank of Pakistan is one of the best banks in national banking sector.
Its growth rate is highest among all banks. There are some flaws like the small
product range, have two are three major business accounts and like others.
National bank has potential to become top ranking bank in Pakistan banking
industry. At present there is no such organizations in the world that is free from
problem and challenges. Every one has to strive and struggle a lot to be more
profitable and to get more competitive edge.
My basic purpose of this internship is to learn about the working of bank. During
my internship I got knowledge about general banking, foreign exchange and
advances. Staff member of National Bank are cooperative with me and really
help me to achieve my objective.
The management of NBP is taking strategic steps to enable the bank to emerge
as a strong and progressive institution. It is continuing to make efforts to improve
its products and operations to make them more compatible.
New deposit
schemes have been introduced and an action plan to maintain the revenue
growth in future. As the business and economic conditions remain unsure.
(MBA)
Page 97
Glossary
ATM
Automated/Automatic Teller Machine
AWB
Air way bill
Working Capital
Stock plus debtor minus short-term creditor

An order written by an exporter instructing an
Bill of Exchange
importer, or an Importers agent, to pay a

specified amount of money at a specified time
A document issued to an exporter by a common
Bill of Lading
carrier transporting merchandise. It serves as a

receipt, a contract, and a document of title
BPS
Basic points (Set by the bank to adjust markup)
CDR
Call deposit receipt
CPA
Corporate premium account
DD
Demand draft
D.P. Note
Demand promissory note, a legal document
FIM
Finance against imported merchandise
FATR
Finance against trust receipt

A bank issued document that guarantees
LC
(MBA)
payment for a pre-specified period and amount
MT
Mail transfer
NIFT
National Institute of facilitation technology
TT
Tele graphic transfer
Page 98
References:
(MBA)
www.nbp.com
www.sbp.com.pk
www.scribed.com/doc/24556629/Nbp
www.nbp.com.pk/services/index.aspx
www.//en.wikipedia.org/wiki/timeline-of-livejournal
www.pakistaniinsurance.net/companies
Staff of the National Bank of Pakistan
Annual report of National Bank of Pakistan
Page 99

Internship Report On National Bank of Pakistan

Hochgeladen von

Dokumentinformationen

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Internship Report On National Bank of Pakistan

Hochgeladen von

Copyright:

Verfügbare Formate

National bank of Pakistan

Program & Session

Name of Program Coordinator

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

Awards and success

Organ gram of NBP

Main branches of NBP

Foreign exchange department

National bank of Pakistan

Import and export department

Consumer & retailing

Financial analysis for bank

Weekly Internship Activities

Suggestion and recommendation

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

(1) Banks do business of money. Rather banks doing business of

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

INTRODUCTION ABOUT BANKING SECTOR

National bank of Pakistan

National bank of Pakistan

HISTORY OF NATIONAL BANK OF PAKISTAN

National bank of Pakistan

National bank of Pakistan

National bank of Pakistan

BRANCHES ALL OVER THE COUNTRY

National bank of Pakistan

Board of directors of National bank of Pakistan

National bank of Pakistan

Chairman & President

Mr. Shahid Aziz Siddiqi

Mr. Zahid Hussain

Mr. Wasiq Mahmood

Syed Muhammad Ali Zamin

NBP RETAIL PRODUCTS

National bank of Pakistan

Unprecedented Safety - Unprecedented

Knitting Links - AASAN Banking

Unprecedented Safety - Unprecedented Return

President's Rozgar Scheme - Easy financing

AffordNBPe, Flexible & Convenient home

National bank of Pakistan

Take upto 20 Advance Salaries - AffordNBPe

One Card does it all - ATM plus Debit Card in

Invest with Confidence - Marginal Finance

Meet your need for ready cash against your

National bank of Pakistan

National bank of Pakistan

Increase the home remittances through the banking system.

SHORT TERM INVESTMENTS

National bank of Pakistan

Awards and success of national bank of Pakistan

National bank of Pakistan

finance, May 2003.