Virtual University of Pakistan

Evaluation Sheet for Internship Report

Spring 2009
MISI619: Internship report (MIS) Credit Hours: 3

Name of Student: MUHAMMAD IMRAN

Marking Total Obtained
scheme marks marks
Student’s ID: mc060400994 Report 70 42.5
writing
Presentation 30
Evaluation Date: __________________________ & Viva voce
Grand total 100

Supervisor: _______________________________
 Marking Scheme for Internship Report Writing
Marks Marks obtained
Prefatory part 5
• Title page
• Acknowledgement
• Executive summary
• Table of contents 4.5
Introduction of the sector/organization 10
• Brief introduction of the organization’s
business sector 7
• Overview of the organization
• Organizational structure
Detailed description of internship program 10
• Plan of your internship program 6
• Training program
Organizational analysis 15
• Structure of the MIS Department
• Functions of MIS Department
OR
• Structure of the department you worked 10
in (Other than MIS)
• Feasibility Report of computerizing the
department you worked in (Other than
MIS)
• Critical analysis 20
• SWOT analysis
9
• Conclusion
• Recommendations
Internship Report Write Up 5
3
Referencing and Annexure 5 3
Total 70 42.5
Different parts of the internship report are not in
proper sequence as required.
You did not provide the critical analysis and
conclusion.
You did not provide the overview of the competitors.
You have included irrelevant data in
departmentalization.
Other comments have been mentioned in the report.
 Internship Report on
National Bank of Pakistan
Main Branch Bahawalnagar
PRESENTED BY:

MUHAMMAD IMRAN

Class: MBA-MIS

STUDENT ID :
mc060400994
Session:
Spring 2009
Internship Date:
Nov 11th to Dec. 22nd 2008
Report completed:
June 27th 2009

VIRTUAL UNIVERSITY OF PAKISTAN

 DEDICATION

I dedicate to my Dear Parents & my

respectable teachers whose assistance is
always with me. And I personally do great
respect by heart.
 Acknowledgement
Here very thanks to Almighty Allah whose
guidance helped me to be trained in a top class
organization, NBP, as well as to complete this
report in a very limited time.

My thanks also to young, dynamic,

congenial, and qualified staff of NBP who
never let me alone in different situations related
to my internship. Without their humble help, it
was not easy.I am thankful to the Bank
Manager,Muhammad Arshad Nagra,NBP Nain
Brach Bahawalnagar.He guide me during my
intership from Nov.11th to Dec.22nd 2008.

Executive summary
 This report is about my internship program with NATIONAL BANK. In this
comprehensive report, I have discussed about every major aspect of the bank, which I observed
and perceived during my internship program. In this report you will find the detail about the
bank right from its incorporation to the current position. Along with it, the processes, policies
and procedures of the bank are also discussed in detail.

As the main purpose of internship is to learn by working in practical environment and to apply
the knowledge acquired during the studies in a real world scenario in order to tackle the
problems using the knowledge and skill learned during the academic process.

In this report the detailed analysis of the organization has been done and the financial, technical,
managerial and strategic aspects have been evaluated to analyze the current position of the
organization.

This report also contains my perceptions about the employee’s satisfaction, motivation level and
the working environment of the organization.

Table of contents should be on separate page.

TABALE OF CONTENTS:

Sr.# Contents Page #

INTRODUCTION 6
1.
2. EVOLUTION OF BANKS IN PAKISTAN 7
3. PRESENT STATUS AND HISTORY 8
4. Banking Reforms 1972 9

5. FINANCIAL POSITION 12

6. PRODUCTS OF NATIONAL BANK OF PAKISTAN 15

7. SAIBAAN SCHEME 16

8. FOREIGN CURRENCY 17

9. EXPORT DEPARTMENT 19
 10. IMPORT DEPRTMENT 19

11. DIFFERENT SCHEMES CONDUCTED BY NBP 21

12. ORGANIZATIONAL STRUCTURE 22

13. Plan of My internship program 27

14. DEPARTMENTALIZATION 29

15. DEPARTMENTATION OF NBP BAHAWALNAGAR MAIM 43

BRANCH.

16. General observation during Training Program 46

17. MANAGEMENT INFORMATION SYSTEM (MIS 54

18. Structure of the MIS Department 57

19. Functions of the MIS Department 58

20. SWOT ANALYSIS 59

21. COMPETITIVE ANALYSIS 63

22. SUGGESTION: 65
23. RECOMMENDATIONS 63

24. References 74

1. INTRODUCTION
Definitions of Bank

“Bank”

"A financial institution, which deals with money and credit. It accepts
Deposits from individuals, firms and companies at a lower rate of Interest and gives at higher
rate of interest to those who need them.”

A financial establishment which uses money deposited by customers for investment, pays it
out when required, makes loan at interest, exchanges currency, etc.
J.W Gilbert in his principles and practice banking defines a banker in these words:

“A banker is dealer in capital or more properly, a dealer in money. He is intermediate party

between the borrower and the lender. He borrows of one and lends to another”.
The American defined the term banker in a very broad sense as under:

“By banking, we mean the business of dealing in credits and by a ‘Bank’ we include
every person, firm or company having a place of business where credits are opened by deposits
of collection of money or currency. Subjects to be paid or remitted on Cheques or order, money
is advanced or loaned on stocks, bonds, bullion, bill of exchange, promissory notes are received
for discount or sale”.

Scope of Studies
As an internee in National Bank of Pakistan the main focus of my study
research is on general banking procedures in one of the branches of NBP in MIS environment.
These operations include remittances, deposits, advances and foreign exchange.
Similarly different aspects of overall of NBP are also covered in this report.

Research Methodology
The report is based on six weeks internship program in National Bank of Pakistan. The
methodology reported for collection of data is primary as well as secondary data. The biggest
source of information is my personal observation while working with staff and having discussion
with them. Formally arranged interviews and discussions also helped me in this regards.

2.EVOLUTION OF BANKS IN PAKISTAN

There are different opinions that how the word ‘Bank’ originated. Some of the author’s opinion
that this word is derived from the word ‘Bancus’ or Banque’, which means a bench. The
explanation of this origin is attributed to the fact that the Jews in Lombard transacted the
business of money exchange on benches in the market place; and when the business failed, the
people destroyed the ‘bench’. Incidentally the word ‘Bankrupt’s said to have evolved from this
practice.
Some of the authors are of opinion that the word ‘Bank’ is derived from the German word back,
which means ‘joint stock fund’. Later on when the German occupied major part of the Italy the
word ‘Back’ was italicized into ‘Back’.
In fact human left the need of bank when it begins to realize the importance of money as a
medium of exchange. Perhaps it where the Babylonian who developed banking system as early
as 2000 BC. At that time temples were used as banks because of their prevalent respect. During
the rule of king Hamurabi (1788 – 1686 BC) the founder of Babylonians Empire, loans were
started being granted for interest. The borrower has to provide guarantee or he had to pledge his
goods or valuables. King Hamurabi drew up a code wherein he laid down standards rules for
procedures for banking operations by temples and great landowners. Also in Greece, the temples
were used as banks, where the people deposited their money and other valuables for safe custody
and security. In Europe with the ‘revival of civilization’ (Renaissance) in the middle of twelve
century, trade and commerce started expanding and this development compelled the business
community to borrow the money from the Hebrew money lenders on high rates of interest and
usury. Seeing the great demand, these moneylenders started organizing themselves and bank
started up at the principle seaports of southern Europe. Soon Venice and Geneva became the
most important money markets of the time and banking though different from its present form,
flourished. What we know as ‘modern banking’ originated in the 14th century in Barcelona

National Bank of Pakistan (NBP) was established under the National Bank of
Pakistan Ordinance 1949. The primary objective of NBP was to purchase jute from the growers
in the former East Pakistan and also to perform the commercial banking functions in the country.

National Bank of Pakistan is now the biggest financial institution with assets totaling over
Rs.310 billion with 1428 local and 23 foreign branches. The bank is the higher financer in
agriculture and commodity operation sector.

As part of the academic requirement for completing MBA (MIS) Master Business
Administration of the students are required to under go six/eight weeks of internship with an
organization. The internship is to serve the purpose of acquainting the students with the practice
of knowledge of the discipline of banking administration.
This report is about National Bank Pakistan. NBP was established in 1949 and since then, it has
expended its network, becoming the largest commercial Bank of the country. It offers different
products of services to its customers.
.

3.PRESENT STATUS AND HISTORY

 National Bank of Pakistan maintain its position as Pakistanis premier Bank
determined to set higher standards of achievements. It is the major business partner for the
government of Pakistan with special emphasis on fostering Pakistanis economic growth through
aggressive and balanced lending policies, technologically oriented branches.

The National Bank of Pakistan came into existence on 20th November 1949 under
the National Bank of Pakistan Ordinance No.21 of 1949.It is a semipublic bank and functions
like other commercial banks. Therefore it receives funds from the depositors and provides
loans/credit facilities in all sectors including trade, industry and agriculture. It also functions as
an agent of the Central Bank and operates the treasuries at places where no branch of State Bank
of Pakistan exists. The National Bank of Pakistan was also nationalized, along with other banks,
in January 1974. The Bank of Bahawalpur was also merged into this Bank.

MANAGEMENT

An Executive Board composed of six Senior Executives of the Bank and the President who
is also the Chief Executive supervises the affairs and business of the Bank.

CAPITAL

The authorized capital of the Bank is Rs.2500 million divided into 100 million ordinary
shares of Rs.10 each. After nationalization, all the shares held by persons other than the Federal
Government or Corporations i.e., owned and controlled by the Federal Government was
considered as transferred and vested in the Government.

BRANCHES

The Bank had a network of 1531branches in the country and 28 branches in foreign
countries. These countries are as follows:
1) - United States of America
2) - United Kingdom
3) - France
4) - Germany
5) - Africa, Middle East Region
6) - Bahrain Obu
7) - Asia Pacific Region
8) - Japan
9) - Republic of Korea
10) - Central Asian States
11) - Bangladesh
12)-Peoples Republic of China
13) -Pakistan.
 The main of the study in hand is together relevant information to compile internship
report on National Bank of Pakistan.
• To observe, analyze and interpret the relevant data competently and in a useful manner.
• To work practically in an organization.
• To develop interpersonal communication.

4.Banking Reforms 1972

After the assumption of office by a new government in 1971, may 1972 different
reforms were introduced to make the banks more responsive to the requirements of economics
growth with social justice. The reforms aimed at bringing about a more purposeful and equitable
distribution of bank credit, improving the soundness and efficiency of the banks, and securing
greater social accountability of the banking system as a whole.
The role of the banking system had been truly spectacular in mobilizing savings of the
community and meeting the credit needs of the economy. But at the same time, the banks had
generally neglected their role in promoting social justice and had failed to play an effective role
in ensuring a wider and more equitable dispersal of the benefits of economic growth. In
particular the inter locking of ownership with commercial and industrial interests had led to the
misuse of bank resources. There was a heavy concentration of credit in big accounts and in urban
area. Credit facilities for agriculture, small business, newly emerging exports and housing had
remained obviously inadequate while the banks indulged in capital financing in few selected
business sectors and issued guarantees on behalf of favored clients, term clients, term financing
facilities for industry were wholly absent.
Under the banking reforms introduced in May 1972 the state bank of Pakistan was accorded
wider powers. It was authorized to remove directors or managerial personnel, if necessary and
supersede the board of directors of a banking company and appoint administrators during the
period of such super session. It was also empowered to nominate directors on the board of every
bank. As regard bank directors, it was provided that anyone defaulting in meeting his obligations
to bank would forfeit his directorship. Moreover, it was laid down that no person could serve as
director of a bank for more than six years continuously. Each bank was required to have a paid
up capital of not less than 5 percent age of its deposits to be progressively build up to 10 percent
age over a period of time. The banks were also required to transfer 10 percentage of their profit
their reserves every years after the reserve became equal to the paid up capital. With a view to
diversity the ownership of the banks, the banks were required to raise new capital from the
market. Unsecured loans to directors, their families or firms and companies, were totally
prohibited.

The bank reforms also brought about the establishment of new institutions to achieve new
objectives. A national credit consultative was setup under the supervise of the state bank with
representation form the government and the private sector. It was assigned the task of
determining of economy’s annual credit needs within the safe limits of monetary and credit
expansion with reference to the annual development plan. Such a credit plan was to cover the
public and private sectors. Alongside the National credit council and Agricultural Advisory
Committee was formed to allocate agriculture credit for various purposes, to coordinate the
operation or the agriculture credit agencies and to oversee the flow of credit to the designated
targets. A standing committee on exports in general and the new emerging exports in particular,
was also established. With a view to encourage the banks to extend credit to small borrowers, a
credit guarantee scheme was introduced under which the state bank under took to share any
bonfire losses incurred by the commercial banks in case of small loans of advances to
agriculture.
At the same time two financing institutions were established. The people’s Finance Corporation
was designed to provide finance to people of small means while the National Development
Finance Corporation was setup of finance public sector owned and managed industries and
enterprises.

The banking reforms turned to be transitional and interim step and when they were hardly
eighteen months old the government nationalized the banking systems, with the following main
objectives.
• To enable the government to use the capital concentrated in the hands of a few rich
bankers for the rapid economic development of the country and the more urgent social
welfare objectives.

• To distribute equitably credit too different classes sectors and regions.

• To coordinate the banking policies in various area of feasible joint activity without
eliminating healthy competition among banks.

The act passed for the nationalization of banks is known as the banks Nationalization Act
1974.
Thus under this act the state bank of Pakistan and all the commercial banks incorporated in
Pakistan and carrying business in or outside the country were brought under government
ownership with effect from Jan 1, 1974. The ownership, management and control of all Pakistani
banks stood transferred to and vested in the Federal government. The shareholders were provided
compensation in the form of federal government bonds redeemable at par anytime within the
period of fifteen years. Under the Nationalization act, the Chairman, Directors and Executives of
various banks, other than those appointed by federal government were removed from their
offices and the central boards of the banks and all local bodies were dissolved. Pakistan banking
council was established to coordinate the activities of the Nationalized Commercial banks. At the
time of Nationalization on December31, 1973 there were following 14 Pakistani commercial
banks with 3323 offices allover Pakistan and 74 offices in foreign countries:

• National banks of Pakistan

• Habib bank limited
• Habib bank (overseas) limited
• United bank limited
• Muslim commercial bank limited
• Commerce bank limited
• Standard bank limited
• Australia bank limited
• Bank of Bahawalpur limited
• Premium bank limited
• Pak Bank limited
 • Sarhad bank limited
• Lahore commercial limited
• Punjab provincial co-operative bank limited

The Pakistan banking council prepared a scheme for the recognition of banks. The bank
(amalgamation) scheme 1974 was notified in April, providing for the amalgamation of the
smaller banks with bigger ones and following the five units in there phases:

• National bank limited

• Habib bank limited
• United bank limited
• Muslim commercial bank limited
• Allied bank of Pakistan limited

The first phase was completed on 30th June. 1974. When the bank Bahawalpur was merged with
the National Bank of Pakistan. The premier Bank Limited with Muslim Commercial Bank
limited and Sarhad Bank Limited and Pak bank limited and renamed as Allied Bank of Pakistan
limited.

The second phase was completed on 31st Dec.1974, when the commerce bank limited
merged with the United Bank limited. The third and the final phase were completed on 30th
June, 1975 when the standard bank limited was merged with Habib Bank limited.

The nationalization was very smooth and gave very positive results.
The number of branches, which stood at 3397 on Dec31, 1973, reached on 7661 by end June
1992. The bank deposits which stood at Rs. 1925 corers at the end 1973 reached the highest
mark about 323 corers

5.FINANCIAL POSITION
Different facts and figures of opening balances of the year 2007 about National bank of
Pakistan which show the financial position are as under:

CAPITAL STRUCTURE
National bank of Pakistan was incorporated with an issued capital of Rs. 15 million.

AUTHORIZED CAPITAL
 The bank has now the Authorized Capital of Rs. 25 billion.
SUBSCRIBED AND PAID-UP CAPITAL
The Subscribed and Paid-up Capital is Rs. 1.46 billion.
TOTAL DEPOSITS
National bank of Pakistan is the largest commercial bank of the country and has Total
Deposits of Rs. 362.87 billion.
ADVANCES
The total Advances stood at Rs. 140.55 billion made by NBP in the form of money at
call and short notices, cash credit, loans for short and long periods.
INVESTMENTS
The total Investment rose to Rs. 143.53 billion. This total Investment includes PTC,
TFC, and securities of Provincial of Federal Government.
PRE-TAX PROFIT
The pre-tax profits of NBP have gone up to Rs. 6.05 billion.
AFTER-TAX PROFIT
The after-tax profits of NBP have been Rs. 2.26 billion.
TOTAL ASSETS
The Total Assets of NBP are Rs. 432.81 billion which is a great achievement.
TOTAL EXPENDITURES
The Total Assets of NBP are Rs. 26.30 billion which are very less as compared to
previous years’ expenditures.

Interim Balance Sheet

 As at September 30, 2008

Assets Note: Amounts Amounts

Cash and balances with treasury banks 81490442 94873249
Balance with other bank 35543549 37472832
Lendings to financial institutions 11335339 21464600
Investments 6 15498353 211142868
Advances 7 5 340322100
Operating fixed assets 38817052 25922979
Deferred tax assets 6 --
Other Assets 26845166 30994965
--- 762193593
LIABILITIES 39607884
Bills payable 73797644 7061902
Borrowings 1 10886063
Deposits and other accounts 8 591907435
Sub-ordinated loans 9496122 --
Liabilities against assets subject to finance lease 28251542 33554
Deferred tax liabilities – net 9 56149949 5097831
Other liabilities 8 30869154
NET ASSETS -- 645855939
25135 116337654
REPRESENTED BY 267528
Share Capital 28607493 8154319
Reserves 62815731 15772124
Unappropriated profit 8 45344188
10981912 69270631
3
47067023
Surplus on revaluation of assets- net of tax 10 8969751 116337654
19250347
CONTINGENCIES AND COMMITMENTS 11 49908027
The annexed notes 1 to 18 from an integral part of
78128125
these condensed interim financial statements
31690998
10981912
3
 Cash Flow Statement

For the period ended September 30, 2008

CASH FLOWS FROM OPERATIONG ACTIVITIES Amount Amount
Profit before taxation 19000776 22180027
Less: Dividend income 2651647 2732574
16349129 19447453
Adjustments for non-cash charges
Depreciation 445225 356070
Provision against non-performing loans and advances 6734076 640375
Reversal for diminution in the value of investments (19741) (50035)
Bad debts written off directly 203 25936
Other provision / write off 270373 170097
Gain on sale of fixed assents (2940) (589)
Financial charges on leased assets 5979 2653
7433175 1144527
23782304 20591980
(increase) / decrease in operating assets
Lendings to financial institutions 10129261 4268063
Held-for-trading securities (12676740) (149579)
Advances (54582705) (5022284)
Other assets (excluding advance taxation – net) (6832862) (7935245)
(63963046) (9109045)
Increase / (decrease)in operating liabilities
Bills payable Borrowings 2434220 (4538848)
Deposits and other accounts 16684982 314570
Other liabilities (30407937) 21056733
(2312138) 1487467
(13600873) 18319922
Income tax paid
Financial charges paid (10282712) (8302250)
(5979) (2653)
Net cash flow from operating activities (10288691) (8304903)
(64070306) 21497954
CAS FLOWS FROM INVESTMENT AXTIVITIES
Proceeds from / net investment in available-for-sale securities 54350515 (38720937)
Proceeds from sale of held-to-maturity securities (3654448) 1010022
Proceeds from sale of investments in associates -- 20195
Dividend income received 2651647 2732574
Investments in operating fixed assets (1367412) (672686)
Sale proceed of fixed assets disposed off 2940 569
Net cash from / (used in) investing activities 51983242 (35630263)

CASH FLOWS FROM FINANCIG ACTIMITIES

Payments of lease obligations (8419) (26921)
Dividend paid (6115740) (2827029)
Net cash used in financing activates (6124159) (2853950)

Effects of exchange rate changes 2208636 154669

Net increase in cash and cash equivalents (16002587) (16831590)

Cash and cash equivalents at beginning of the period 131456989 118813121

Cash and cash equivalents at the end of the period 115454402 101981531
6.PRODUCTS OF NATIONAL BANK OF
PAKISTAN
Retail Product

1. Premium Aamdani Home Page

Unprecedented Safety - Unprecedented Return

2. Premium Saver Home Page

Unprecedented Safety - Unprecedented Return

3. Karobar Home Page

President's Rozgar Scheme - Easy financing for self employment

4. Saibaan Home Page

Affordable, Flexible & Convenient home financing for all

5. Advance Salary Home Page

Take up to 20 Advance Salaries - Affordable Installations from 1 - 60 months

6.Cash Card Home Page

One Card does it all - ATM plus Debit Card in one

7. Investor Advantage Home Page

Invest with Confidence - Marginal Finance Facility

8. Cash and Gold Home Page

Meet your need for ready cash against your idle gold jewelry with no minimum limits

9. Kisan Taqat Home Page

NBP KISAN Taqat

10. Kisan Dost Home Page

NBP's affordable agricultural program offers you a wide range of financing

11.Online Home Page

Knitting Links - AASAN Banking

12. NBP Helpline

from 8:30 am to 10:00 pm
7.SAIBAAN SCHEME
NBP SAIBAAN DOCUMENTS FOR SALARIED CLASS

• Application form (in original).

• CNIC copies of the applicant.
• Two references CNIC copies.
• Photographs of the applicant(06)
• Employment card copy.
• Appointment letter.
• Service Letter / Certificate.
• Salary cum service certificate.
• Last three Months salary Certificates.
• Branch Account’s statement last six months.
• Last Three Month Utility Bills
• Approved Map
• Original property Documents.
• Aks Sajra.
• Fard Malkiat
• Naqal Intiqal
• Khasra Verification report
• National Evaluation Company’s report.
• PT-I
• Sale Deed/ Registry.
• Processing Fee pay order for Rs.500/=
• Fee for Evaluator pay order ( in case of construction Rs.2000/= (in case of
Purchase Rs.3000/=
• Processing Fee pay for legal opinion order for Rs.1000/=
• Borrower Basic Facts Sheet
• Confidential Report
• ALICO DECLARATION FORM.

NBP SAIBAAN DOCUMENTS FOR BUSINESS CLASS

• Application form (in original).
• CNIC copies of the applicant.
• Two references CNIC copies.
• Photographs of the applicant(06)
• Business Related Documents.
• Last three years Business Record.
• Branch Accounts statement last one year.
• Last three month Utility Bills.
 • ICIL- Department Verification ( Income Estimation)
• Approved Map

Registry / Sale Agreement

• Aks Sajra.
• Fard Malkiat
• Naqal Intiqal
• Khasra Verification report
• NOC
• National Evaluation Company’s report.
• PT-I
• Sale Deed/ Registry.
• Processing Fee pay order for Rs.1000/=financing below Rs. 1 Million.
• Fee for Evaluator pay order Rs.3000/=financing between Rs. 1 to Rs. 4 Million.
• Processing Fee pay for legal opinion order for Rs.6000/= financing above Rs.4
Million.
• Fee for Evaluator pay order ( in case of construction Rs.2000/= (in case of
Purchase Rs.3000/=
• Borrower Basic Facts Sheet
• Confidential Report
• ALICO DECLARATION FORM.

8.FOREIGN CURRENCY
Guaranttee The word guarantee means under taking.

Three parties are involved during the process of Guarantee

• Principal (Seller).
• Guarantor (Bank).
• Beneficiary (Buyer).

Outward Remittance The outward remittance is the term which emphasizes that to transfer
amount from one country to another country.

The sources used to transfer the amount are Transfer Transactions (TT), Demand Draft
(DD).The procedure of outward remittance is initially been undertaken that when account holder
fill the request letter. The request letter contain following information are

• Request of debit.
 • Amount to be mentioned.
• Beneficiary name.
• Beneficiary account no.

There is the concept of two accounts are NOSTRO A/C, VOSTRO A/C.Western Union
Western Union is the name of Australian Bank which provide facility of providing payment with
out wasting time. There are 259 banks in world wide who provide the facility where no bank
exist

The amount sent to other place for this we do require certain documents are ID copy name
of the person to whom the amount is sent .Then Bank will assign PIN CODE .The amount is
send with in 15 minutes. When the receiver go to the bank to receive the amount he had to show
his ID COPY or ORIGINAL PASSPORT then the authorize officer will identify through
NADRA its identification.

CHARGES

Minimum charges will be received is $20.

Commission will be charged or Rs. 1200.

Inward Remittance In this department the process is contrary to outward remittance the amount
from foreign country to the Pakistan. In this case the amount received is in the form of cheque,
Pay order etc.

9.EXPORT DEPARTMENT
Collection The collection Department is the initial phase of the export department.

First E-Form is to provided to the party .It is given on following criteria

The current account of the exporter should be activated for the issue of the E-Form.

TYPES OF E-FORM

There are four types of form are

• Original.
• Duplicate.
 • Triplicate.
• Quadrapled.

The Banks are involved between the parties .All deals and documentation are made between the
banks. The bank of Seller and Buyer contact with their party about the transaction when there is
no conflict between the party the process goes on until transaction is completed.

10. IMPORT DEPRTMENT

In this department they deal with the following section to process the Import Department.

• LC opening.
• Lodgment.
• Retirement of LC.

LC OPENING

Firstly Importer presents the Proforma Invoice to the bank Then Importer will fill
the form (IB-8) which cost Rs.100 .Proforma should not be expired.

C&F(exporter will pay ),FOB( Importer will pay shipment charges) should be mentioned on the
form. The LC opening application form requires certain documents are

• Name and address of the applicant.

• Name and address of the beneficiary.
• Insurance detail.
• Nature of LC.
• Commodity.

LC LODGEMENT

After LC opening Exporter bank will send document to the Importer Bank for the purpose
of LC. Advisory bank is the correspondent bank. In case of any discrepancy found and is
accepted then the $50 is charged for further processing. Normally the discrepancy is created after
shipment. When the documents are accepted by Importer and Exporter then payment is to be
made.
RETIREMENT OF LC

At time of payment or retirement we deal with following Import channel are LC.

• Advance Payment.
• Payment after shipment.
• Foreign DD & TT.

LETTER OF CREDIT

LC further categorize in to two things are Sight.Usances.

In case of sight the charges are taken as follows

MARK UP = B.E*Days* 0.4%

1000

In case of Usance the charges are

P&T charges of Rs.400.

Service charges of 0.1%of B.E

Commission is deducted from the party at the time of expiry. When the period is delayed of
1 month then charge 0.1%, if the period is 2 month then charges is 0.2%.FED 5% on total
commission

SERVICE CHARGES

The charges of 0.1% of Bill of Exchange is charged. After the period of 15 days then the
commission is charged .FED is charged on 5% on commission.

ADVANCE OF PAYMENT

The payment is made to the party in advance to the exporter through bank. The bank also
deduct margin from the Importer so that bank could serve itself

SERVICE CHARGES

Minimum commission for the amount less $400.At increase of every $1000 $ is charged.

FED is to be charged of 5%on commission amount.

P&T is charged of Rs.400

11.DIFFERENT SCHEMES CONDUCTED BY NBP
National Bank of Pakistan always makes efforts to improve its goodwill in the
general public. It introduces different kind of schemes time to time.
The most popular schemes conducted by NBP are as under:
1 ... ... Hajj Mubarak Scheme
2 ... ... NBP Advance Salary Scheme
3 ... ... Fund Management Scheme
4 ... ... LG TV Scheme

1. HAJJ MUBARAK SCHEME

For the convenience of a person with a limited income who desire to perform Hajj, Hajj
Mubarak Scheme is introduced. Moreover, National Bank of Pakistan process the Hajj
applications of thousands of people successfully more than any other bank in Pakistan.
2. NBP ADVANCE SALARY SCHEME
Do you need urgent funds? If yes then head to National Bank of Pakistan and avail “NBP
Advance Salary Scheme”, which allow you to draw three months salary in one go. This facility is
available to permanent employees of the:-
1 ... ... Federal and Provincial governments
2 ... ... Semi-governments, autonomous, semi-autonomous, local bodies, and
government corporations
3 ... ... Other corporations approved by NBP

No guarantee, collaterals, or insurance is required to avail this scheme. NBP gives the
facility to repay the excessive amount within 1 to 36 months. The procedure is very easy, just fill
the application form and choice between 1 to 36 months and take your NBP Advance Salary
within 3 days after submitting your form.
3. FUND MANAGEMENT SCHEME
 This scheme is offered to corporate under customer and is aimed at providing better rate of
return up to 15% per annum. One of the objectives of the scheme is to develop the secondary
market for government securities.
4. LG TV SCHEME
It is the most popular of NBP schemes for people. corporates with LG Appliances
Corporation. If you want a TV set but has not enough money to purchase it then head to NBP,
fill an application form of LG TV Scheme. NBP gives you the facility to pay for the TV set in
smaller installments during a time period of 2 years.
Any one can avail this scheme. Two government employees are required to present the
witness to repay the loan if the applicant is unable to repay the loan or the applicant should have
the Fixed Term Deposit in NBP more worthily than the amount advanced to the applicant and it
should have the duration of more than two years.

12.ORGANIZATIONAL STRUCTURE
In this section four topics are discussed. The major topics of this section are:

1. Management and Organization of a Commercial Bank

2. Senior Management
3. Regional Structure
4. Branch Structure

1. MANAGEMENT AND ORGANIZATION OF A

COMMERCIAL BANK

The ownership, management, and control of all the commercial banks were taken over
by the Government of Pakistan on January 1st, 1974.

A banking council was formed under the Nationalization Act 1974. The banking council was set
up for making policy recommendations to the Federal Government, formulating policy
guidelines for the banks and their reorganization.
The management and organizational structure of the nationalized banks have uniformity. This
management and organizational structure is briefly described as under:

• Board of Directors
 • Executive Board
• Chief Executive
• Divisional Chiefs
• Provisional Chiefs
• Circle Executive
• Zonal Heads
• Branch Managers

1.1 Board of Directors

In the management of the banks, the board of directors is at the top of the controlling body. Since
there are no private share holders now, so there is no general meeting of the share holders and no
elected directors. The BOD consists of a nominated President, a Secretary, and 9 other members.
The board has limited administrative powers because after the Nationalization Act 1974, most of
powers are transferred to the Banking Council and Executive Board.

1.2. Executive Board

The general direction and supervision of the affairs of commercial banks lies in their respective
Executive Boards. An EB also consists of a President, a Secretary, and 9 other members,
appointed by the Federal Government.
1.3. Chief Executive
The President of the Executive Board is the Chief Executive. He is the administrative head of a
bank and presides over the meetings of Executive Board.

1.4. Divisional Chiefs

In order to improve the management and operation of a bank, it has been split up into a numbers
of divisions. Each division of a bank is placed under the supervision and control of Divisional
Chief (also called the Senior Executive Vice President or Executive Vice President)

1.5. Provisional Chiefs

In order to improve the performance of banking system, each bank has a Provisional Chief. PC
has the powers for sanctioning finance and other credit facilities. Each headquarter is situated in
each province e.g. in Lahore, Peshawar, Quetta, and Karachi.

1. 6. Circle Executive
Each commercial bank has a number of circles placed directly under the control and supervision
of Chief Executive.

1.7. Zonal Heads

Each circle is divided into a number of zones. These zones are administered by Zonal Heads who
hold the posts of Vice President or Assistant Vice President.

1.8. Branch Managers Each zone of commercial bank is divided into several branches. The
control and supervision of each branch is mostly entrusted to Assistant Vice President or
Officer G-II.
Complete organizational hierarchy chart has not been provided.

2.SENIOR MANAGEMENT
R. A. Kaleemi SEVP & Group Chief, Operational Group
Masood Karim SEVP & Grp Chf, Co. & Invst Banking
Grp & Chf Fncl Officer
S. M. Rafique SEVP & Secretary Board of Directors
Derrick Cyprian SEVP & Group Chief, Special Assets &
Remedial Mngt Group
Amin Akhtar EVP & PSO to the President
Farooqul Hassan EVP & Chief President’s Implementation
Secretariat
Shahid Anwar EVP & Group Chief, Commercial & Retail
Banking Group
Safdar Khawaja EVP & Group Chief, Audit & Inspection
Group
Asif A. Brohi EVP & Group Chief, Strategic Planning &
Eco Research Group
Javed Mehmood EVP & Group Chief, Risk Management
Group
M. Nusrat Vohra EVP & Group Chief, Treasury
Management Group
Nadeem Dogar EVP & Group Chief, IT Planning &
Implementation Group
Dr. Abrar Baig Head of Human Resources Management
Department
Uzma Bashir Head of Organization Development &
Training Department

3.REGIONAL STRUCTURE

REGIONAL
CHIEF
EXECUTIVE
GENERAL GENERAL GENERAL
MANAGER MANAGER MANAGER
Advances, Legal Planning, Business Administrative
and Recovery Wing Development Wing
Customer Services
and Implementation
of Audit

4.BRANCH STRUCTURE

MANAGER OG-I ADVANCE

OG-II ADMIN
 OG-II OG-II OG-II OG-III
SERVICES CASHIER ACCOUNTS

ASSISTANT ASSISTANT ASSISTANT ASSISTANT

GODOWN GODOWN GODOWN GODOWN

KEEPER KEEPER KEEPER KEEPER

HEAD MESSANGER

MESSANGER
Comments on organizational structure?

13. Plan of My internship program

Plan of internship is not according to the format. You did not provide the starting and
ending dates of internship program, brief introduction of the branch.
Writing an Internship Program Plan

I carefully planed and wrote out my internship program and goals. The internship
program and goals were measured by Bank management team and others in
organization. Structuring the internship ahead of time provided me with tangible goals and
objectives that enabled me to prove myself for understanding the importance of the
organization’s decision-makers and value of a well-developed internship program.
In creating my internship program plan, it includes specific ideas, proposals, and logistical
information. I constructed my plan based on organization’s needs and resources. The questions
that follow many assist me in formulating an internship program and plan.
What about general support around the workplace? Does their organization need an intern
to perform administrative and support functions including data entry, answering telephones,
filing, etc.? If so, approximately what percentage of the intern’s time will be spent on these
activities?

Does the Bank want to give the intern a taste of everything that company does?

How will cross-training be structured into the intern’s schedule?

How much time will need to be devoted to department/area?

Have employees from each department been designated to mentor the intern on their
particular department functions?

Will bank pay the intern? If so, how much?

Where should I do internship?

Do I have adequate workspace there?

Where will be the best environment and supportive persons etc.?

Who will have the primary responsibility for the intern?

Will that person be a mentor or merely a supervisor?

The assignment of mentor who will work closely with the intern can be essential in
creating a successful experience for the organization and then intern. Ideally, the mentor should
be someone from the department where the intern is working and who is very familiar with the
projects and tasks the intern is working on. This person doesn’t have to be a teacher per se, but
should be selected because he or she likes to teach or train and has the resources to do it. If the
person you select has never mentored an intern before, providing basic supervision and
mentoring guidelines and training may enhance the experience for both the mentor and the
intern.

What will the intern be doing?

Be as specific as possible.Interns, like others in the process of learning, need structure so
they don’t become lost, confused or bored.

Do you want to plan a program beyond the work you give your interns? Will there be
specific training programs, performance reviews, lunches with executives or social events? Keep
in mind that your interns are walking advertisements for your company. If they have a good
experience working for you, they’re likely to tell their friends—word gets around. A bad
internship, by contrast, can only hurt your chances of attracting good students for next year.

Managing the Internship

Starting out

I set up regular contact with the faculty sponsor. I Planed to email (meet) with your
professor regularly over the term to discuss activities and review your internship and progress
towards your academic learning objectives. At a minimum, plan on keeping in regular touch via
email.
Arrange regular meetings with site supervisor. It is vital you meet regularly with your site
supervisor for direction, feedback, and answers to questions. Ideally this should be weekly, or at
least bi-weekly.
I completed the required Orientation Check In form. After your first couple of
weeks working in your site, complete this form and return it to the Internship Program office. It
is very important that you get a solid start in your internship, and this is largely determined by
how well you are initially oriented and trained. I used the form as a way to talk with my
supervisor to identify areas i need or want additional direction. This communication helps our
office identify internships that may warrant a bit more attention early on to help make productive
for me. Also, on the form I am asked to note my work schedule so we can begin planning site
visits for the middle of the term.

During the internship

I completed the required Evaluation of Intern form. I met with my site supervisor to review,
signed and returned this form to the Internship Program office by the requested date.
Site visit. The Internship Program Director and/or my faculty sponsor may contacted me to
arrange a site visit to meet with me and my supervisor. This is a wonderful chance to discuss
how the internship is going and to share some of the work you are doing in the internship.
Problems? If, at any point during the internship, I was having problems that were interfering
with the quality of the learning experience, I contacted the Internship Program Director for
support and assistance.

Finishing up

I completed the required Final Evaluation of Intern form. As I approached

the end of the term, met with my site supervisor to review and signed this form and returned it to
the Internship Program office. A copy of this is sent to your faculty sponsor who uses it to help
determine a final grade for your internship experience.
Closure with my host organization I communicated in writing my appreciation to my supervisor
and co-workers for the attention and management they provided me during my internship. This is
an important professional courtesy and can benefit me in future networking.
Closure with my Instructor I arranged a final meeting with my by mail instructor to review the
internship, discuss future plans, and submit my required assignment(s) as outlined in my
Learning Contract. This must be done prior to the last day of class for the semester so my
Instructor has time to submit a grade for your internship.

Irrelevant data has been provided in this section.

 14.DEPARTMENTALIZATION
Dividing an organization into different parts according to the functions is called
departmentalization. So NBP is divided into Departments.

1. CASH DEPARTMENT

2. CLEARANCE DEPARTMENT

3. ADVANCES DEPARTMENT

4. REMITTANCE DEPARTMENT

5. Department of HUMAN RESOURCE MANAGEMENT

6. DEPOSIT DEPARTMENT: -

7. FOREIGN EXCHANGE/DEPARTMENT:

1. CASH DEPARTMENT
Cash department performs the following functions
1.1) Receipt
The money, which either comes or goes out from the bank, its record should be kept. Cash
department performs this function. The deposits of all customers of the bank are controlled by
means of ledger accounts. Every customer has its own ledger account and has separate ledger
cards.
Payments
It is a banker’s primary contract to repay money received for this customer’s account usually by
honoring his cheques.
1.3) Cheques and their Payment
The Negotiable Instruments. Act, 1881,
“Cheque is a bill of exchange drawn on a specified banker and not expressed to be payable
otherwise than on demand”.
Since a Cheque has been declared to be a bill of exchange, it must have all its characteristics as
mentioned in Section 5 of the Negotiable Instruments Act, 1881. Therefore, one can say that a
Cheque can be defined as an:
“An unconditional order in writing drawn on a specified banker, signed by the drawer, requiring
the banker to pay on demand a sum certain in money to, or to the order of, a specified person or
to the bearer, and which does not order any act to be done in addition to the payment of money”.
(Law of Banking by Dr. Hart, p.327).
1.4) the Requisites of Cheque
There is no prescribed form of words or design of a Cheque, but in order to fulfill the
requirements mentioned in Section 6 above the Cheque must have the following.
• It should be in writing
• The unconditional order
• Drawn on specific banker only
• Payment on Demand
• Sum Certain in money
• Payable to a specific person
• Signed by the drawer

1.5) Parties to Cheque

The normal Cheque is one in which there is a drawer, a drawee banker and a payee, or no payee
but bearer.
• The Drawer
• The Drawee
• The Payee

1.6) Types of Cheques

Bankers in Pakistan deal with three types of cheques
a) Bearer Cheques
Bearer cheques are cashable at the counter of the bank. These can also be collected through
clearing.
b) Order cheque
These types of cheques are also cashable on the counter but its holder must satisfy the banker
that he is the proper man to collect the payment of the cheque and he has to show his
identification. It can also be collected through clearing.
c) Crossed Cheque
These cheques are not payable in cash at the counters of a banker. It can only be credited to the
payee’s account. If there are two persons having accounts at the same bank, one of the account
holder issues a cross-cheque in favour of the other account holder. Then the cheque will be
credited to the account of the person to whom the cheque was issued and debited from the
account of the person who has actually issued the cheque.

1.7) Payment of Cheques

It is a banker’s primary contract to repay money received for his customer’s account usually by
honouring his cheques. Payment of money deposited by the customer is one of the root functions
of banking. The acid test of banking is the receipt of money etc. from the depositors, and
repayment to them. This paying function is one, which is the distinguishing mark of a banker and
differentiates him from other institutions, which receive money from the public. However the
bankers’ legal protection is only when payment is in ‘Due Course’. The payment in due course
means payment in accordance with the apparent tenor of the instrument, in good faith and
without negligence to any person in possession thereof under circumstances, which do not afford
a reasonable ground of believing that he is not entitled to receive payment of the amount therein
mentioned. It is a contractual obligation of a banker to honor his customer’s cheques if the
following essentials are fulfilled.
 • Cheques should be in a proper form:
• Cheque should not be crossed:
• Cheque should be drawn on the particular bank:
• Cheque should not mutilated:
• Funds must be sufficient and available:
• The Cheque should not be post dated or stale:
• Cheque should be presented during banking hours:

2. CLEARANCE DEPARTMENT
A clearinghouse is an association of commercial banks set up in given locality for the
purpose of interchange and settlement of credit claims. The function of clearinghouse is
performed by the central bank of a country by tradition or by law. In Pakistan, the clearing
system is operated by the SBP. If SBP has no office at a place, then NBP, as a representative of
SBP act as a clearinghouse.

After the World War II, a rapid growth in banking institutions has taken place. The use of
cheques in making payments has also widely increased. The collection as settlement of mutual
obligations in the form of cheques is now a big task for all the commercial bank. When Cheque
is drawn on one bank and the holder (payee) deposits the same in his account at the bank of the
drawer, the mutual obligation are settled by the internal bank administration and there arises no
inter bank debits from the use of cheques. The total assets and total liabilities of the bank remain
unchanged.

In practice, the person receiving a Cheque as rarely a depositor of the cheque at the same
bank as the drawer. He deposits the cheque with his bank other than of payer for the collection of
the amount. Now the bank in which the cheque has been deposited becomes a creditor of the
drawer’s bank. The depositor bank will pay his amount of the cheque by transferring it from cash
reserves if there are no offsetting transactions. The banks on which the cheques are drawn
become in debt to the bank in which the cheques are deposited. At the same time, the creditors’
banks receive large amounts of cheques drawn on other banks giving claims of payment by them.

The easy, safe and most efficient way is to offset the reciprocal claims against the other and
receive only the net amount owned by them. This facility of net inter bank payment is provided
by the clearinghouse.

The representatives of the local commercial banks meet at a fixed time on all the business
days of the week. The meeting is held in the office of the bank that officially performs the duties
of clearinghouse. The representatives of the commercial banks deliver the cheques payable at
other local banks and receive the cheques drawn on their bank. The cheques are then sorted
according to the bank on which they are drawn. A summary sheet is prepared which shows the
names of the banks, the total number of cheques delivered and received by them. Totals are also
made of all the cheques presented by or to each bank. The difference between the total represents
the amount to be paid by a particular bank and the amount to be received by it. Each bank then
receives the net amount due to it or pays the net amount owed by it.
2.1) In-Word Clearing Books
The bank uses this book for the purpose of recording all the cheques that are being received by
the bank in the first clearing. All details of the cheques are recorded in this book.

2.2) Out-Word Clearing Book:

The bank uses outward clearing register for the purpose of recording all the details of the
cheques that the bank has delivered to other banks.

3. ADVANCES DEPARTMENT
Advances department is one of the most sensitive and important departments of the
bank. The major portion of the profit is earned through this department. The job of this
department is to make proposals about the loans. The Credit Management Division of Head
Office directly controls all the advances. As we known bank is a profit seeking institution. It
attracts surplus balances from the customers at low rate of interest and makes advances at a
higher rate of interest to the individuals and business firms. Credit extensions are the most
important activity of all financial institutions, because it is the main source of earning. However,
at the same time, it is a very risky task and the risk cannot be completely eliminated but could be
minimized largely with certain techniques.

Any individual or company, who wants loan from NBP, first of all has to undergo the filling of a
prescribed form, which provides the following information to the banker.

3.1) Name and address of the borrower.

Existing financial position of a borrower at a particular branch.

Accounts details of other banks (if any).
• Security against loan.
• Exiting financial position of the company. (Balance Sheet & Income Statement).
• Signing a promissory note is also a requirement of lending, through this note borrower
promise that he will be responsible to pay the certain amount of money with interest.

3.2) Principles of Advances

There are five principles, which must be duly observed while advancing money to the
borrowers.

• Safety
• Character
• Capacity
• Capital
• Liquidity
• Dispersal
• Remuneration
 • Suitability
• Forms of Loans
• Cash Finance
• Overdraft/Running Finance
• Demand Financing/Loans

a. Safety
Banker’s funds comprise mainly of money borrowed from numerous customers on
various accounts such as Current Account, Savings Bank Account, Call Deposit Account,
Special Notice Account and Fixed Deposit Account. It indicates that whatever money the banker
holds is that of his customers who have entrusted the banker with it only because they have full
confidence in the expert handling of money by their banker. Therefore, the banker must be very
careful and ensure that his depositor’s money is advanced to safe hands where the risk of loss
does not exist.
The elements of character, capacity and capital can help a banker in arriving at a conclusion
regarding the safety of advances allowed by him.

b. Character
It is the most important factor in determining the safety of advance, for there is no substitute for
character. A borrower’s character can indicate his intention to repay the advance since his
honesty and integrity is of primary importance. If the past record of the borrower shows that his
integrity has been questionable, the banker should avoid him, especially when the securities
offered by him are inadequate in covering the full amount of advance.
It is obligation on the banker to ensure that his borrower is a person of character and has capacity
enough to repay the money borrowed including the interest thereon.

c. Capacity
This is the management ability factor, which tells how successful a business has been in the past
and what the future possibilities are. A businessman may not have vast financial resources, but
with sound management abilities, including the insight into a specific business, he may make his
business very profitable. On the other hand if a person has no insight into the particular business
for which he wants to borrow funds from the banker, there are more chances of loss to the
banker.

d. Capital
This is the monetary base because the money invested by the proprietors represents their faith in
the business and its future. The role of commercial banks is to provide short-term capital for
commerce and industry, yet some borrowers would insist that their bankers provide most of the
capital required. This makes the banker a partner. As such the banker must consider whether the
amount requested for is reasonable to the borrowers own resources or investment.

e. Liquidity
Liquidity means the possibilities of recovering the advances in emergency, because all the
money borrowed by the customer is repayable in lump sum on demand. Generally the borrowers
repay their loans steadily, and the funds thus released can be used to allow fresh loans to other
borrowers. Nevertheless, the banker must ensure that the money he is lending is not blocked for
an undue long time, and that the borrowers are in such a financial position as to pay back the
entire amount outstanding against them on a short notice. In such a situation, it is very important
for a banker to study his borrower’s assets to liquidity, because he would prefer to lend only for a
short period in order to meet the shortfalls in the wording capital. If the borrower asks for an
advance for the purchase of fixed assets the banker should refuse because it shall not be possible
for him to repay when the banker wants his customer to repay the amount. Hence, the baker must
adhere to the consideration of the principles of liquidity very careful.

f. Dispersal
The dispersal of the amount of advance should be broadly based so that large number of
borrowing customer may benefit from the banker’s funds. The banker must ensure that his funds
are not invested in specific sectors like textile industry, heavy engineering or agriculture. He
must see that from his available funds he advances them to a wide range of sector like
commerce, industry, farming, agriculture, small business, housing projects and various other
financial concerns in order of priorities.
Dispersal of advances is very necessary from the point of security as well, because it reduces the
risk of recovery when something goes wrong in one particular sector or in one field.

g. Remuneration
A major portion of the banker’s earnings comes form the interest charged on the money
borrowed by the customers. The banker needs sufficient earnings to meet the following:
Interest payable to the money deposited with him.
• Salaries and fringe benefits payable to the staff members.
• Overhead expense and depreciation and maintenance of the fixed assets of the bank.
• An adequate sum to meet possible losses.
• Provisions for a reserve fund to meet unforeseen contingencies.
• Payment of dividends to the shareholders.

h. Suitability
The word “suitability’ is not to be taken in its usual literary sense but in the broader sense of
purport. It means that advance should be allowed not only to the carefully selected and suitable
borrowers but also in keeping with the overall national development plans chalked out by the
authorities concerned. Before accommodating a borrower the banker should ensure that the
lending is for a purpose in conformity with the current national credit policy laid down by the
central bank of the country.

i. Forms of Loans
In addition to purchase and discounting of bills, bankers in Pakistan generally lend in the
form of cash finance, overdrafts and loans. NBP provides advances to different people in
different ways as the case demand.

j. Cash Finance
This is a very common form of borrowing by commercial and industrial concerns and is made
available either against pledge or hypothecation of goods, produce or merchandise. In cash
finance a borrower is allowed to borrow money from the banker up to a certain limit, either at
once or as and when required. The borrower prefers this form of lending due to the facility of
paying markup/services charges only on the amount he actually utilizes.
If the borrower does not utilize the full limit, the banker has to lose return on the un-
utilized amount. In order to offset this loss, the banker may provide for a suitable clause in the
cash finance agreement, according to which the borrower has to pay markup/service charges on
at least on self or one quarter of the amount of cash finance limit allowed to him even when he
does not utilize that amount.

k. Overdraft/Running Finance
This is the most common form of bank lending. When a borrower requires temporary
accommodation his banker allows withdrawals on his account in excess of the balance which the
borrowing customer has in credit, and an overdraft thus occurs. This accommodation is generally
allowed against collateral securities. When it is against collateral securities it is called “Secured
Overdraft” and when the borrowing customer cannot offer any collateral security except his
personal security, the accommodation is called a “Clean Overdraft”. The borrowing customer is
in an advantageous position in an overdraft, because he has to pay service charges only on the
balance outstanding against him. The main difference between a cash finance and overdraft lies
in the fact that cash finance is a bank finance used for long term by commercial and industrial
concern on regular basis, while an overdraft is a temporary accommodation occasionally resorted
to.

l. Demand Financing/Loans
When a customer borrows from a banker a fixed amount repayable either in periodic
installments or in lump sum at a fixed future time, it is called a “loan”. When bankers allow
loans to their customers against collateral securities they are called “secured loans” and when no
collateral security is taken they are called “clean loans”.
The amount of loan is placed at the borrower’s disposal in lump sum for the period agreed upon,
and the borrowing customer has to pay interest on the entire amount. Thus the borrower gets a
fixed amount of money for his use, while the banker feels satisfied in lending money in fixed
amounts for definite short periods against a satisfactory security

4. REMITTANCE DEPARTMENT
Remittance means a sum of money sent in payment for something. This department
deals with either the transfer of money from one bank to other bank or from one branch to
another branch for their customers. NBP offers the following forms of remittances.
• Demand Draft
• Telegraphic Transfer
• Pay Order
• Mail Transfer

4.1) Demand Draft

Demand draft is a popular mode of transfer. The customer fills the application form.
Application form includes the beneficiary name, account number and a sender’s name. The
customer deposits the amount of DD in the branch. After the payment the DD is prepared and
given to the customer. NBP officials note the transaction in issuance register on the page of that
branch of NBP on which DD is drawn and will prepare the advice to send to that branch. The
account of the customer is credited when the DD advice from originating branch comes to the
responding branch and the account is debited when DD comes for clearance. DD are of two
types.
• Open DD: Where direct payment is made.
• Cross DD: Where payment is made though account.
NBP CHARGES FOR DD5
• Up to Rs. 50,000/- is Rs 50/- only
• Over Rs. 50,000/- is 0.1%

4.2) Pay Order

Pay order is made for local transfer of money. Pay order is the most convenient, simple
and secure way of transfer of money. NBP takes fixed commission of Rs. 25 per pay order from
the account holder and Rs. 100 from a non-account holder.

4.3) Telegraphic Transfer

Telegraphic transfer or cable transfer is the quickest method of making remittances.
Telegraphic transfer is an order by telegram to a bank to pay a specified sum of money to the
specified person. The customer for requesting TT fills an application form. Vouchers are
prepared and sent by ordinary mail to keep the record. TT charges are taken from the customer.
No excise duty is charged on TT. The TT charges are:
Telegram/ Fax Charges on TT = Actual-minimum Rs.125.
Cable telegram transfer costs more as compared to other title of money. In cable transfer the
bank uses a secret system of private code, which is known to the person concerned with this
department and branch manager.

4.4) Mail Transfer

When the money is not required immediately, the remittances can also be made by mail
transfer (MT). Here the selling office of the bank sends instructions in writing by mail to the
paying bank for the payment of a specified amount of money. Debiting to the buyer’s account at
the selling office and crediting to the recipient’s account at the paying bank make the payment
under this transfer. NBP taxes mail charges from the applicant where no excise duty is charged.
Postage charges on mail transfer are actual minimum Rs. 40/- if sent by registered post locally
Rs.40/- if sent by registered post inland on party’s request
.
5. Department of HUMAN RESOURCE MANAGEMENT
Human Resource plays a vital role in the success of every service organization. They
interact between man and machine. Their attitude can win or loose the customer. The positive
attitude could only be created in a conducive environment, which can make the staff dedicated
towards the organization and its objectives. In reality the man is more important than machine as
it is the human which could get maximum out of machine to keep a happy customer. However,
most organizations give little importance to this very important asset.
Various aspects related to human resource of National Bank of Pakistan are critically examined
in the following text:
5.1) Selection & Recruitment
Although the Bank believes in merit but in practice the selection of employees is not done on
merit. Most of the employees are low educated. This shows that candidates with some strong
family background or political pressure are given preference in recruitment and qualified
candidates are sometimes left behind.

5.2) Job for Life

Like the employee of public sector organizations in Pakistan, the employees of NBP also enjoy
their job for life. Since there is no risk of early retirement or redundancy in rank, they do not
perform with their full potentials. This is one redundancy in rank, they do not perform with their
full potentials, and this is one of the reasons responsible for the low productivity of the
employees of the Bank.
5.3) Performance Appraisal
The performance of employees of the Bank are appraised though their annual confidential
reports at the end of each year. This has become an outdated method of performance appraisal
and no longer used due to the following reasons:

• The performance of employees is evaluated after quite a long time.

• Element of subjectivity is involved in this method.
• Employee’s participation is not ensured in the process of evaluation.
• Objectives of employee’s are not quantified.

5.4) Inter Personal Relationship

Modern management acknowledges human resources as one ‘of the most important
assets of an organization. But by their very nature, human beings are also the most unpredictable.
Where a number of persons work together, interactions among them, of necessity, will lead to
conflicts and NBP is no exception. Most interpersonal conflicts in NBP can be traced back to the
following major heads.
• Lack of Communication
• Lack of communication is for the biggest reason for conflicts.
• Not only it is due to the failure to send a massage but to an interpretation given to the
massage by the receiver is different from that intended.

5.5) Diversity in Values

Diversity in values, perceptions, cultural background and life-style is another reason
responsible for inter personal conflicts in NBP. Different values and perceptions about the same
issue, event or personality hinder understanding. When things come to such a pavement,
therefore, interpersonal conflicts are generated.
The dominant trend in all modern industrial societies of the world is merit and expertise, which
helps promote cohesion and reduce conflicts. But the feudalistic mindset is still very strong in
our set up and there is no tradition of tolerance for differing viewpoints. Hence, interpersonal
conflicts are generated.

5.6) Corruption
Our social acceptance of corruption gives rise to corruption at every level of social and
organizational set up. Corruption involves financial embezzlement, favoritism, nepotism,
cronyism and other number of such practices. All these cause resentment that keep building up
and lead to conflict sooner or later.
In the past few years, some cases of frauds have happened in different branches. The reasons can
be linked with the employee dissatisfaction of NBP.

5.7) Discipline & Authority

Maintaining discipline and implementation of authority (tables) in letter and spirit is the
key to success of any organization. In NBP, The authority tables are not strictly maintained. Line
managers are not fully equipped with the authority with no vertical or horizontal interference.
6.) DEPOSIT DEPARTMENT: -
It controls the following activities:
• A/C opening.
• Issuance of cheque book.
• Current a/c
• Saving a/c
• Cheque cancellation
• Cash

6.1) Account opening

The opening of an account is the establishment of banker customer relationship. Before a
banker opens a new account, the banker should determine the prospective customer’s integrity,
respectability, occupation and the nature of business by the introductory references given at the
time of account opening. Preliminary investigation is necessary because of the following reasons.
• Avoiding frauds
• Safe guard against unintended over draft.
• Negligence.
• Inquiries about clients.
There are certain formalities, which are to be observed for opening an account with a bank.
• Formal Application
• Introduction
• Specimen Signature
• Minimum Initial Deposit
• Operating the Account
• Pay-In-Slip Book
• Pass Book
• Issuing Cheque Book
6.1.1) Qualification of Customer
The relation of the banker and the customer is purely a contractual one, however, he must
have the following basic qualifications.
• He must be of the age of majority.
• He must be of sound mind.
• Law must not disqualify him.
The agreement should be made for lawful object, which create legal relationship
Not expressly declared void.

6.1.2) Types of Accounts

Following are the main types of accounts
• Individual Account
• Joint Account
• Accounts of Special Types
• Partnership account
• Joint stock company account
• Accounts of clubs, societies and associations
• Agents account
• Trust account
• Executors and administrators accounts
• Pak rupee non-resident accounts
• Foreign currency accounts

6.2 Issuing of cheque book:

This deptt issue cheque books to account holders.

Requirements for issuing cheque book
• The account holder must sign the requisition slip
• Entry should be made in the cheque book issuing book
• Three rupees per cheque should be recovered from a/c holder if not then debit his/her
account.

6.3 Current account

These are payable to the customer whenever they are demanded. When a banker accepts a
demand deposit, he incurs the obligation of paying all cheques etc. drawn against him to the
extent of the balance in the account. Because of their nature, these deposits are treated as current
liabilities by the banks. Bankers in Pakistan do not allow any profit on these deposits, and
customers are required to maintain a minimum balance, failing which incidental charges are
deducted from such accounts. This is because the depositors may withdraw Current Account at
any time, and as such the bank is not entirely free to employ such deposits.
Until a few decades back, the proportion of Current Deposits in relation to Fixed Deposits was
very small. In recent years, however, the position has changed remarkably. Now, the Current
Deposits have become more important; but still the proportion of Current Deposits and Fixed
Deposits varies from bank to bank, branch to branch, and from time to time.
6.4) Saving account
Savings Deposits account can be opened with very small amount of money, and the
depositor is issued a cheque book for withdrawals. Profit is paid at a flexible rate calculated on
six-month basis under the Interest-Free Banking System. There is no restriction on the
withdrawals from the deposit accounts but the amount of money withdrawn is deleted from the
amount to be taken for calculation of products for assessment of profit to be paid to the account
holder. It discourages unnecessary withdrawals from the deposits.
In order to popularize this scheme the State Bank of Pakistan has allowed the Savings
Scheme for school and college students and industrial labor also. The purpose of these accounts
is to inculcate the habit of savings in the constituents. As such, the initial deposit required for
opening these accounts is very nominal.

6.5) Cheque cancellation:

This deptt can cancel a cheque on the basis of;
• Post dated cheque
• Stale cheque
• Warn out cheque
• Wrong sign etc

6.6) Cash
This deptt also deals with cash. Payment of cheques, deposits of cheques etc.

7. FOREIGN EXCHANGE/DEPARTMENT:

This deptt mainly deals with the foreign business. The main functions of this deptt are:
• L/C dealing.
• Foreign currency accounts dealing.
• Foreign Remittance dealing.
7.1) L/C dealing
NBP is committed to offering its business customers the widest range of options in the area
of money transfer. If you are a commercial enterprise then our Letter of Credit service is just
what you are looking for. With competitive rates, security, and ease of transaction, NBP Letters
of Credit are the best way to do your business transactions.

7.2) Foreign currency account dealing:

This deptt deals with the foreign currency accounts which mainly include dollar account,
euro account etc.

7.3) Foreign Remittance dealing.

This is very important function of this deptt.

15. DEPARTMENTATION OF NBP

BAHAWALNAGAR MAIM BRANCH.
I did internship in Main branch BWN (Bahawalnagar) in Punjab province. Here the
Manager, Muhammad Arshad Nagra and the Operational Manager Muhammad Amin and other
staff members give full assistance and cooperation during my internship period.
The stating date was November11 2008 and ending date was December 22 2008 of my
internship period.
This is the core section of your internship report. You should provide the detailed description of
the tasks assigned to you during your internship program, and this section should be under
training program.
The tasks assigned to me during internship duration.
During the internship period I was assigned the tasks as fallow:
1. Data entry in computer
2. Maintaining D.Ds and T.Ts. Registers
3. Customer Dealing about the bank’s products
4. Maintaining the cash department.
5 Maintaining the I.T Department
6. Accounts opening and closing
7. Online banking
8. Maintaining saving and current accounts.
9. Observing the managerial decision making

Dividing an organization into different parts according to their functions is called

departmentation. So NBP Bahawalnagar branch is divided into parts.

• Cash Department
• General Banking Departments

1. Cash Department:
 Cash department mainly deals in cash. The Head of department is Mr. Umair Rao and two
cashier Maher Shah and Muhammad Ali.

The objective of cash department:

“To facilitate people in the payments of their bills and taxes and repayments of cash”
There are two main functions of cash department.

i. Payment ii. Receipts

• Payments are the function that they pay their cheques and pay cash.
• Receipts mean collection of utilities bills, taxes etc.

2. General Banking Departments

In this section of the bank the general banking function is performed. It is divided into five
departments.
• Remittances Department.
• Computer Department.
• Advances Department.
• Clearing Department.
• Establishment Department.

2.1 Remittances Department:

This department is header by Zahid Ahmad a very competent person. The objective of this
department is:-
“To transfer the money of people from one place to another place in safe and comparable
way”
The main functions of this department are:
• Issuing of demand draft.
• Issuing of Mail transfer.
• Issuing of Telegraphic transfer.
• Issuing of payment order.
• Issuing of call deposit.
• Pension payments etc.
• Closing and scrolling of government collections.

2.2 Advances department:

Every bank has a department which advances money to borrowers. In NBP
Bahawalnagar branch the advances department is head by the Business Manager Sir Asim and
Operation Manager Sir Amin. Both are very competent persons. The objective of Advances
Department is
“To facilitate people by giving short term and long term loans on easy terms and
conditions”.
The main function of this Department is to take surplus money from the people at low rates and
lend this money to borrowers at high rates to earn profit.
2.3 Clearing Department:
A clearing house is an association of commercial banks set in State Bank of Pakistan
for the purpose of interchange and settlement of credit claims.
In NBP Bahawalnagar Branch this department is headed by Ameer Shehzad having experience
of about thirty years. The objective of this department is to

“To facilitate customers for payment their Cheques of other banks”.

Two type of clearing books are maintained.

i) In word clearing books:

The bank uses this book for the purpose of recording all the cheques that are being received by
the bank in the first clearing. All detail of the cheques are recorded in this book.
ii) Out word clearing book:
The bank uses outward clearing register for the purpose of recording all the details of the
cheques that the banks have delivered to other banks.
2.4 Computer Department:
This department headed by the accountant Mr.Saad and two other persons Mr. Junaid and
Mr. Shahid are performing the real function.

The objective of this Department is to facilitate customers in payment of their cheques”.

The main functions performed by this department are:
• Checking balance.
• Deduction from balance on clearing cheques.
• Issuing bank statements.
• Dealing Western Union.

2.5 Establishment Department:

NBP Bahawalnagar Branch having an Establishment Department. This Department
consists of only one person Nasir Baig very competent and experienced person. This department
mainly deals with the branch employees. The main objective of this department is to “To
regulate bank business”.

Main functions of this department are:

• Keeps the record of attendance of employees.
• Employee’s salaries distribution.
• Employee’s bonuses etc.

16.General observation during Training Program

TRAINING SUBSTANCE
In this section topic discussed is as under:
• Work performed by me
Tasks assigned to you should be under this section.

WORK PERORMEDBY ME

I joined National Bank of Pakistan, Main Branch Bahawalnagar on 11th November, 2008.
First day, the manager introduced me about the functioning of the branch and the staff. The
manager told me that counter is the most important place of the bank. During the six weeks of
my internship, I worked in different departments of the branch and did the maximum practice of
banking system details of which is as under:

GENERAL BANKING
 First of all, I was asked to work in different sections of general banking. I was attached to
Counter with Mr. Kashif who has good command on this section. Here we dealt with new
customer who wanted to get information and to deal with the branch. This is a very interesting
department because here we met people of different types and deal with them accordingly. In this
section, I observed the following functions:

CHEQUE AT COUNTER
A cheque to withdraw the amount is presented on the counter with the following
requisites:
1 ... ... Name of the Account Holder
2 ... ... Current or previous date
3 ... ... Amount in figures
4 ... ... Amount in wording
5 ... ... One signature of the account holder in the right bottom corner of the cheque and
two signature of the bearer on the back
6 ... ... Branch Stamp in front of the cheque
7 ... ... If the Account Holder uses thumb instead of signature then the Pass Book is
necessary with the cheque
Operation’s officer checks and verifies all these requisites. If it fulfills all the requisites, it
is forwarded for payment after a certain procedure.

CHEQUE PAYMENT PROCEDURE

After all the requisites are verified and then the excessive balance is checked and
prescribed amount is deducted narrated on the cheque, then SIGNATURE VERIFIED stamp
(in case of signature only) on the signature and a PAY CASH stamp are fixed and a Token is
given to the cheque bearer after writing Token No. on the specified cheque. Then the Officer
G-II verified the cheque and forwarded it to the cashier where the cheque bearer receives the
amount from the account.
ISSUANCE OF DEMAND DRAFT
 A Demand Draft is provided to the client in which he has to specify that bank it is drawn.
The amount both in words and figures is written on Demand Draft.
BILLS COLLECTIONS DEPARTMENT
I spent second week of my training in bills collection department. Mr. Afzal is the in
charge of this section. Here we collected utility bills like electricity bills, gas bills, and telephone
bills.

BILL REMITTANCE DEPARTMENT

This is very important and interesting department. This section deals with the transfer of
money from one branch to another branch. Nearly four drafts are issued daily from this
department. Here I know how the amount is transferred and what the procedure is. This
department also deals with TT transfer of money. I worked nearly two weeks in this
department.

DEPOSIT DEPARTMENT
Deposit department deals with Current, Savings, and Fixed Accounts. In current account
the bank does not give any interest and you can deposit the whole amount in lump sum in
business hours.
However in PLS savings account we can only withdraw up to Rs.25000/- without any
notice otherwise a prior notification of a weak is required to the bank if the amount to be
withdrawn is more than Rs.25000/-
Old ages are interested in Fixed Account usually. The rate of interest is higher more than
that of in Current and PLS savings Account but the amount cannot be withdrawn before a
specific time fixed by the client.
To open the account customer have to fulfill an application form and submit to the
concerning authority. In Current and PLS saving Account, a Cheque Book is issued to the
client and he becomes the Account Holder of NBP. I worked in this department for one and a
half week.
 I have divided general observation in four parts. Which are as under: This analysis is
mainly based on my general observation.
• Problems at the branch.
• Function analysis.
• Administrative analysis.
• Personal management’s analysis.

1. PROBLEMS AT THE BRANCH

1.1 Customer Satisfaction

In NBP customer dealing is well, but during rush hour the customer has to wait for a long time
for their turn. It’s quite hard for a new customer or potential customer to get the required
information.
1.2 Poor record management and filing system
During my internship I observed that filing system of branch is not good. When certain record is
needed the staff has to struggle to find it out and a lot of time is wasted.
1.3 Unequal distribution of work
Work is not equally distributed. On one hand some employee have to work all day without
relaxing while some others have nothing to do at all. This not only creates confusion among
employees but also hurting and disturbing for overall setup of the bank. And above all it results
in dissatisfaction among customers as well.
1.4 Marketing visits
A useful mode of contact is through personal marketing visits. Such visits are important in
informing and perusing the existing and potential customers about the products and creating a
sense of belongingness with them.

2. FUNCTIONAL ANALYSIS

2.1 Formal Organization

Formal organization includes the activities of two or more person, which are cautiously
determined groups and coordinated towards a given objective. It provides base when people are
able to communicate with other, when they have common purpose and they are willing to work.
In NBP, we find a formal organization. Bernard referred to an organization as a formal when the
activities of two or more persons are coordinated towards a given objective. The formal
organization comes into being when people are able to communicate with one another or willing
to act and share a purpose.
In this formal organization of NBP the activities are carried out in a more formal way. In
theoretical terms it provides basis for communication with one another but in practice it is not
exercised because an employee at high level cannot get straight away to manager or SVP and ask
him about of his problem faced by him, because first he has to talk to his immediate superior and
follow a proper channel of communication.

2.2 Difference between theory and practice

A vast difference exists between theory and practice and NBP has written procedure but practical
work done by employees is a bit different from written procedures.

2.3 Bank duty to maintain secrecy.

They don’t care about maintaining secrecy, especially during the rush hours. They speak loudly
about the account position and while getting clearance of cheque the person can easily get the
whole information from the ledge. The deposit clerk must be careful while passing any cheque.
In this regard another shortfall is in giving the information about the balance on telephone.

2.4 Excessive paper work

It is notified that due to the lengthy procedure of paper work the bank employee are over
burdened. They are unable to give proper attention to the clients and face difficulties in getting
their job done. One reason for lengthy procedure and excessive paper work in the bank is the
lack of computerized technology.

2.5 More accounts fewer deposits.

Efficient banking is one which does not emphasize on number of accounts but on greater amount
of deposits. NBP is more interested in increasing its number of account irrespective to its
deposit. The main reason behind it is that bank does not provide personalize service to all the
account holders and does not improve its quality and services

2.6 Delegation of authority

Manager has very limited authority; he has to take the approval from his management authority
i-e. In case of advance he has to take the approval of general and regional manager. The other
problem is created, when the manager is not present in his office, the customer have to wait for
hours. This discourages both customer and officers because they have to suffer a lot

3 ADMINISTRATIVE ANALYSIS

3.1 Job analysis is not effective

Only on the basis of job analysis it can be decided how a right person can be hired, trained,
compensated or promoted. It is very important for an organization that nature of the job is
described and job specifications are mentioned. Most of the employees are simple graduate and
do not have proper background about their job. This creates problems both for organization and
for the employees. In NBP salaries are given according to the seniority and grades. People with
simple or complex responsibility are getting the same salary and facilities. This creates
dissatisfaction among employees.

3.2 Carelessness in opening of account

When customer comes to open an account, the staff does not bother to check his/her place
phone number and permanent address. It is important because in case of overdraft by mistake or
anything which places his account in debit it will be difficult to trace him. On the other hand he
may be involved in any fraudulent activities against the bank. In this case the bank will be in
awkward position.

3.3 Lack of specialized training

NBP does not provide adequate facility of specialized training to their staff. Training is
generalized rather than specialized. As the worker finishes his training, he is inducted into a
specific field without having great deal of knowledge about the field.
In the Bahawalnagar branch the newly recruited employee training was not imparted, they all
learned things on the job.

3.4 Low Profit Rates

Most of the customers shifted their account to the National Saving Center because of the low
rates of saving deposit discourages the customers. Bank should increase their profit rates to
attract customers.

3.5 Poor job rotation.

There is absence of job rotation in main NBP Bahawalnagar branch. A person placed in one
department remains their forever. It reduces career opportunities as well boredom and in the end
results in career platueing. Job rotation is very important for employee especially for those who
are newly recruited. The newly recruit should be rated in all department of the banking in order
to get familiar with working of different departments so that when they get a responsible position
they have know how of the whole system.

3.6 Delays in Loan Advancement

It has been observed that there are delays in sanctioning of cases form the head office, which
results in customer dissatisfaction.

3.7 Lack of appreciation

Another very important thing which is ignored in the bank is appreciation if the employee on
their good performance. If hard work and performance of employees is not recognized and
appreciated they become dishearten which results in decline in performance.

4. PERSONAL MANAGEMENT ANALYSIS

4.1 Need for better training program

Need of training is greatly emphasized all around the world. Training of the personnel is
part of human resource management. It has been noticed that the training program of NBP is not
adequate.
Once the candidate is selected and placed on the respective job. It becomes essential to
train him adequately for the task. They should learn new methods for motivating customers. The
training programmed of the bank should include scientific techniques to improve the decision
making and interpersonal as will individual needs of the employee both specialized to fresh as
well as on job to maintain the high standards of service.

4.2 Developing Managerial Leadership

Leadership is a practical term of visible, clear on objective and communicating better control on
financial and administrative matters. Manager is not only responsible for their own units in
business, but also in people terms i.e. training, recruiting, grievance handling and taking
immediate initiative in crisis situation to take major decision affection the future of the bank and
banking community.
4.3 Recruitment policy
Human resources are the lifeblood of the organization. If the personnel are recruited carefully
they can become asset to the organization in the case of carelessness a liability on the
organization. Bank is not following its recruitment policy properly due to favoritism, nepotism
and political pressure. Both the top authority and staff union tries their best recruit their favorites,
indulgence of political pressure add salt to the wounds. The persons selected through these
channels are infantile and do not work for the betterment for the bank.

4.4 Promotions
Promotion in NBP is purely on the basis of seniority, so the new young person having high
qualification remains behind for quite a lot of time. Top management and staff union put
pressure for the promotion of their favorites, which gives a sense of deprivation to the deserving
employee and their efficiency is affected.As the concept of promotion is attached with better in
terms of greater responsibility, more prestige, greater skills and increased rate of salary. Thus a
better and impartial policy of promotion needs to be followed.

4.5 Transfer
Transfer means when a person is shifted from one place to another place. It is done either that
person is needed more on the other branch or for improving his skill variety. It is the policy of
the Bank to transfer each employee 3 to 4 years.

4.6 Marketing at desk

Bank employee come in daily contact with many people who happen to deal with the casual
remittance, travelers cheques, safe custody, pensioners, depositing license fee and variety of
other functions and variety of other people with whom the Bank has no account or regular
business relationship. The Bank employees are doing very little on their own to explore the
possibilities of selling banking services to them as a marketing contributor. The entire Bank
community should make a conscious effort in addition to their normal work to explore the
possibilities of selling banking services to them. The market opportunities are hidden in every
dealing a banker handles; the question is that if he has the art and urge to seize such
opportunities.

4.7 Lack of business communication

There is no proper way to give information to their customer. To avoid this minor dissatisfaction
and tension in the mind of customer, and deficiency of the service, it is recommended that the
bank should provide brochures etc containing information in details.
Some general information should be placed in information notice board on the entrance where
customer can see it easily or it should be self-attractive.

17. MANAGEMENT INFORMATION SYSTEM

(MIS)
 I worked in MIS/IT department and observed the system during internship all
activities in IT department were noted and made some practical work there.
MIS Analyst Main Responsibilities: - Assist in the development and planning of the management
information systems which will provide timely financial information with respect to product
profitability - Conduct financial analysis for proposed new products, business and other projects
- Work closely with business units to define the data.

Responsibilities Prepare management accounting entries, maintain funds transfer pricing system
rules and validate system output Prepare and distribute monthly management reports Respond to
user inquiries on management accounting results Operate and maintain management accounting
database.

Management Information System (MIS)

The National Bank Corporate System provides detailed information (MIS) which can help in
controlling expenses. Monthly management reporting is an integral component of the corporate
Card offer from National Bank. It gives the management and its employees a complete expense
tracking mechanism. It also provides a reasonable credit period.
Thus reducing your working capital requirement this will reduce the time and cost associated
with expense control. The report package provides both Summaries and itemizations of charges
and payments. The reports help you;
• Streamline expense control
• Analyze spending patterns
• Forecast future spending
• The Individual Card Member Billing Statement

For convenience they give a one-glance statement that details each individual charge. It
shows clearly all purchases, cash advances, applicable finance and service charges and
amounts that remain outstanding month-wise.
Consolidated Company Statement
Useful for monitoring Card usage and payments, NBP Corporate Card system provides you with
details of each Card Member's expenditure. It lists the date, place, amount of expenditure, the net
amount payable by each Card Member, and at the end of the report, the grand total for the
company.

Individual Account Description

once you nominate your employees to become NBP Corporate Card Members, you can receive
reports. These will tell you in a variety of useful ways, how Card members are incurring
expenses. Your employees simply need to charge expenses and pay back conveniently after
receiving their statement. Card Members will receive a billing statement each month that lists
their charges and payment activity.

Cost Savings
Improved cash float: The Corporate Card minimizes the need for cash advances and the
administrative burden involved in tracking & reconciling them. Moreover, Card Members are
billed once every month, which helps improve the Companies cash flow.

Better rates from Suppliers: Management Information (MIS) generated by the Bank Corporate
Card System helps the Corporation identify new savings opportunities and support fact based
negotiations with suppliers.
The Merchant Spending Report provides cumulative spending by all Card Members split into the
travel and entertainment heads for e.g. by Hotel property, airlines, travel agencies, ATM cash
with drawl, car rentals, petrol etc. This information can be used to obtain better rates from
suppliers, and realize tangible cost savings.

No Interest costs: The Bank Corporate Card is a Charge Card wherein bills are payable on
receipt. This inculcates financial discipline amongst employees, saving the Company
unnecessary interest burden on overdue out standing.

Corporate pricing advantage: Unlike other Cards, Bank Corporate Card recognizes your
Company's buying leverage. As the number of Cards issued in a company increases the annual
fee payable per Card keeps reducing saving costs to the corporation

Reduced Administrative Burden

Single Payment instrument: One Card for all your T & E requirements. The Bank Corporate
Card significantly reduces paperwork involved in processing and paying multiple vendor bills
across multiple travelers. It also eliminates the need to set up credit lines with a range of vendors
used by your corporation.
Flexibility: You can opt for a billing and payment methodology aligned to your internal
accounting and reporting procedures.

Multiple Billing & Payment Plan: Bank has the flexibility of sending bills to individual Card
members or to a single recipient in your Company. You can also choose to pay Bank centrally or
let individual Card members settle their own bills.

Access to single vendor for all your travel related needs: As a Bank Corporate Card customer,
you can access International travel partner, allowing you the convenience and efficiency of
dealing with a single quality supplier for all your travel related requirements.

Option of Individual and Corporate liability:

You have the option of opting for the Corporate Card program with individual or corporate
liability.

Benefits to the employees

Convenience:
Ease of charging and accounting business expenses:
Bank provides you with a billing statement that lists all charges on the Card date wise with
complete transaction details.So you know how much you spend and where. The descriptive
billing statements help reconciliation of expenses
Attractive spending limit: Unlike most other Cards the Bank Corporate Card provides the
flexibility to the corporate to set spending limit for the company nominees. Frequent travelers
find this facility extremely useful when handling large expenses and during unexpected
situations such as extended business trips.Wide acceptance at quality establishments where
business travelers normally incur business expenses. Bank Corporate Card is affiliated to Visa
and is welcomed at all Visa Merchant Establishments.

Global Customer Assistance Services: Visa provides the following Card related assistance
services to Bank Corporate Card Members when traveling overseas.
• Lost/stolen Card reporting
• Emergency Card replacement
• Emergency cash disbursement
• Security / Insurance Cover
• Photo and Signature option for Individual Card Members
• Limited loss Card liability. Post reporting the loss of Card, liability is Nil.
• World Class Service
• 24 hour customer services delivered to international standards from all over the country.

Membership Rewards:
Bank Rewards Plus Program, Opportunity to participate in the most powerful Rewards
program in Pakistan.. And it is so simple to redeem these points. The Card Member needs to
accumulate a minimum of 150 reward points and at the end of the year can redeem these reward
points against any items in the rewards catalogue.

Other Benefits to Card Members

Emergency Assistance Services that enables Card Members to obtain emergency legal/medical
referrals while traveling overseas.

MIS Supports to other departments

The Management Information Services Department provides a variety of services relating to
computer and telecommunications services, application software development, design and
production services, and software training to all internal Town clients and departments. These
services encompass personal computers, networks, printers, servers, and more. The MIS
Department is an innovator in the field of information technology management, using a
combination of management solutions that maximize effectiveness and minimize cost. The MIS
Department also consults with other departments to analyze and select proper IT solutions for
specific applications, provides internet access, computer training and support, and mobile
computing solutions for Town departments.
MIS coordinates all Town-wide core business functions and information technology
administration. This includes accounts payable, utility billing, payroll administration, general
ledger, budget, purchasing, human resource management systems, accounts receivable,
permitting, code enforcement, police and fire dispatch and EMS reporting, and office
automation.

System and Network Support

Development and maintenance of the Town's core communication infrastructure and wide area
network. Maintain file and application servers and network security management, software
distribution, and technical support for hardware and software.

Development:
It Provides design, development, implementation services and continued support of special data,
and databases town wide.

Web Development
The MIS Department designs, develops, implements and maintains the website.
Information technology changes rapidly and new systems and technology are continually being
implemented and installed. The MIS Department strives to translate this technology into higher
productivity for departments, and higher quality output for reduced costs of operations that
ultimately benefits the citizens of area.

18.Structure of the MIS Department

 Head of Computer & IT (MIS)
Dept

Head of Secretary / Typist

Technical
Archive

Head of Support &

Head of System Design & Information Network &
Computer
Integration Internet Manager
Operation

Head of Head of Head of

Internet/Intr
Compute Head of Desin of fin. Admin. Web
anet
r Support Tech. & & Comm. Master
Manager
Operatio Oper. Sys Manager
n
Head
Sen. Head fin., Senior Senior
HW Tech. Sys
Expert Adm. Analyst & Analyst &
Sen.
OS Sys. Programm Programm
Eng
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Head
Tel. Proc. Sen. Exp. Head Comm.
Sen. Eng. database OS Sys

19. Functions of the MIS Department

Having founded the information technology (IT) services industry more than 10 years
ago, MIS delivers high value management consulting, electronic business solutions, business
process management, and systems and technology expertise to help clients simplify complexity
and achieve superior value in the digital economy.

MIS Controller
He infrastructures support group skills to provide front office internal advisory role on MIS
related issues and... reputation both within the bank and externally. There are 4 main areas that
comprise the department...; Financial Reporting and Control, Product Control, Regulatory Risk,
and Business and Corporate MIS. Moves... business lines within a supportive setting and
surrounded by skilled professionals.

Senior Accountant
Senior Accountant is responsible for the enhancement of the control... business performance,
through monthly commentaries and business reviews. This key role will see you... month-end
reporting and MIS to the Front Office, Bottom of Form
Business Analyst - Finance Change, Investment Banking
He integrates programs within a Global Investment Bank based in the City. The suitable
candidate will support... existing finance reporting systems across the bank. Both projects will
look at reengineering the finance... platforms for General ledger and MIS Reporting, with
specific responsibility for: Business requirement... Liaising with business and technical teams
across the bank Suitable candidates will be a Qualified

C# Lead Developer – Collateral IT

In the systems supporting the F2B business and will have an increasing role in new business...
business. The role exists for a lead C# Winforms GUI developer on Collateral Portal, our next
generation... suite of trader tools. The role will involve: Designing and establishing a simple GUI
implementation

Policy & Portfolio Reporting Analyst

Internal Audit Role Leading Global Investment Bank Credit Product... A new position has arisen
with this leading global investment bank for a Policy en Portfolio... Reporting Analyst to join the
reporting team Main Duties of the role include: Technical data expert provide portfolio data
analysis, quality assurance, MIS production for portfolio reports to understand.
Major functions: (of Policy and portfolio Reporting Analyst)
He explains the role of information technology as a business enabler and identifies and explains
management information systems applications including customer relationship management
systems, enterprise systems, e-commerce applications, transaction processing systems, business
analytics, and emerging technologies. He evaluates the organizational fit and suitability of
business applications and interprets the interaction between information technology, customers,
processes, data, infrastructure, participants, and environment in an organization. He understands
the ethical challenges of information technology and explains the evolving role of management
information systems in the organization, and the role and careers of MIS professionals.
Critical analysis has not been provided.
20. SWOT ANALYSIS
SWOT analysis is an acronym that stands for strengths, weakness, opportunities, and threats
SWOT analysis is careful evaluation of an organization’s internal strengths and weakness as well
as its environment opportunities and threats.
“SWOT analysis is a situational which includes strengths, weaknesses, opportunities and threats
that affect organizational performance.”

“The overall evaluation of a company strengths, weaknesses, opportunities and threats is called
SWOT analysis.”

In SWOT analysis the best strategies accomplish an organization’s mission by:

1. Exploiting an organizations opportunities and strength.
2. Neutralizing it threats.
3. Avoiding or correcting its weakness.

SWOT analysis is one of the most important steps in formulating strategy using the organization
mission as a context, managers assess internal strengths distinctive competencies and weakness
and external opportunities and threats. The goal is to then develop good strategies and exploit
opportunities and strengths neutralize threats and avoid weaknesses.

1. STRENGTHS:

1.1 OLDEST INSTITUTION:

NBP in one of the oldest bank of Pakistan and first nationalized bank Hence its customer base is
strength from this plus point as customers have more confidence in the bank. The additional
value services as the privilege for the bank.

1.2 ALTERNATE DUTIES IN SBP ABSENCE

The NBP performs additional services for its customers as well as the other bank customer in the
absence of SBP.

1.3 MORE DEPOSITS THAN OTHER BANK

NBP has the relative competence in having more deposits than the other bank. This is because of
the confidence the customer have in the bank. The bank being the privileged and oldest bank in
banking sector of Pakistan enjoys this edge over all others, lacking it.

1.4 EMPLOYEE BENEFITS

The employers at NBP are offered reasonable monetary benefit. Normally two bonuses are given
Eid-Ul-Fitar & Eid-Ul-Azha. This serves as an additional benefit and competency for the bank
and a source of motivation for the employees.

1.5 BROAD NETWORK

The bank has another competency i.e. it has broad-basses network of branches throughout the
country also more than one branch in high productive cities. The customers are provided services
at their nearest possible place to confirm customer satisfied.

1.6 STRICTLY FOLLOWED RULES &REGULATION:

The employees at NBP are strict followers of rule & regulation imposed by bank. The disciplined
environment at NBP bolsters its image and also enhances the over all out put of the organization.

1.7 PROFESSIONAL COMPETENCE

The employees at NBP here have a good hold on their descriptions, as they are highly skilled
Professionals with back ground in business administration, banking, economics etc. These
professional competencies enable the employees to understand and perform the function and
operation in better way.

1.8 HEALTHY ENVIROMNMENT

The working condition in the NBP branch here is very conductive and favorable for better
output. The informal environment affects the performance of the employees in a positive way.

1.9 RELATION BETWEEN STAFF AND OTHER EMPLOYESS

The bank enjoys a good plus point when it comes to the employee manager relationship the
hearing as removing of discrepancies if any, between the employees, and between the manager
and employees.

2. WEAKNESSES
2.1 LACK OF MARKETING EFFORT:
The bank does not promote its corporate image, services, etc on a competitive way. Hence lacks
far behind in marketing effort .A need for aggressive marketing in there in the era marketing in
now becoming a part of every organization.
It’s a threat.
2.2 NBP UNDER POLITICAL PRESSURE
The strong political hold of some parties and government and their dominance is affecting the
bank in a negative way. They sometime have to provide loan under the pressure, which leads to
uneven and adjusted feeling in the bank employees.

2.3 FAVORITISM AND NEPOTISM

The promotions and bonuses etc in the bank are often powered by senior’s favoritism or depends
upon their wills and decision. This adds to the negative factors, which denominate the employees
thus resulting in affecting their performance negatively.

2.4 LACK OF FINACIAL PRODUCT

The bank falls far behind when the innovative and new schemes are considered. It has not been
involved in the tug of war between the competitors to the accounts and strengthens the existing
customer base. This stands out to be the major incompetence and weakness of the banks.

2.5 INEFFICIENT COUNTER SERVICES IN THE RUSH HOURS

During the rush hours, the bank is founded out to be a total flop to handle the mob of people
peaking from windows and doors. The bank has deficiency to operate in the stages of rush hours
where the people find them services entangled in a situation of nowhere because they are not
well served.

2.6 LACK OF COMPUTERIZED NETWORK

The bank lack the strength of being powered by the network of computers, which have saved
time, energy and would have lessened the mental stress, the employees have currently. This
would add to the strength if it were powered by network of computers.

2.7 LACK OF MODERN EQUIPMENT

The bank lacks the modern Equipment that is note counting machine computers. Even if there is
any equipment they lack to fall in the criteria of being rearmed as update and upgraded

2.8 UNEVEN WORK DISTIBUTION.

The workload in NBP is not evenly distributed and the workload tends to be more on some
employees while others abscond away from their responsibilities, which server as a demotivation
factor for employees performing above average work.
3. OPPORTUNITIES
3.1 ELECTRONIC BANKING
The world today has become a global village because of advancement in the technologies,
especially in communication sector. More emphasis is now given to avail the modern
technologies to better the performances. NBP can utilize the electronic banking opportunity to
ensure on line banking 24 hours a day. This would give a competitive edge over others.

3.2 MICRO FINANCING

Because of the need for micro financing in the market, there are lot of opportunities in this
regard. Other banks have already initiated, now the time has arrived when the NBP must realize
it and take on step to cater an ongoing demand.

4. THREATS
4.1 EMERGENCE OF NEW COMPETITORS
The bank is facing threats with the emergence of new competitors especially in terms of foreign
banks. These foreign banks are equipped with heavy financial power with excellent and
innovative ways of promoting and performing their services. The bank has to take initiative in
this regard or will find itself far back in competition.

4.2 POLITICAL PRESSURE BY ELECTED GOVERNMENT

The ongoing shift in power in political arena in the country effects the performance of the bank
has to forward loans to politically powerful persons which create a sense of insecurity and
demoralization in the customer as well as employees.

4.3 DOWNSIZING
The bank is currently acting upon the policy of downsizing which threaten the environment of
the bank Employees feel insecurity in doing their jobs and work, hence affecting the over all
performance of employees negatively.

4.4 CUSTOMERS COMPLAINTS

There exists no regular and specific system of the removal of customer complaints. Now a day a
need for total customer satisfaction is emerging and in their demanding consequences customer's
complaints are ignored
 21. COMPETITIVE ANALYSIS
Porter’s five forces model:
This approach is widely used for competitive analysis. It is because of the high intensity of
competition among companies there five main competitive forces.

1. Rivalry among competitive firms:

It is a very powerful force among the competitive forces the strategies pursued by one firm can
be successful only to extent that they provide competitive advantages over the competitor. These
competitive strategies may be lowering prices, best quality series. The NBP offering very low
charges an demand draft, telegraphy transfer, mail transfer and give other additional services to
the customers and to the Nation. Because NBP is a “Nation’s Bank”.

2. Potential entry of new competitors:

Whenever new firms ca easily enters a particular industry, the competition increases. The gout
restriction, tariffs, patents etc can stop new firm to enter into the business as per Banking
industry is concerned this market is already very situated in Pakistan and there are banks with
quality services and low charges. So there is no threat to NBP from potential entry and NBP is
also a public sector bank because of that no other new bank not takes over it.

3.Potential Development of substitute products:

This is the third factor affecting the competitions. There may be some other product can be
substitute the product of that industry. For example banks offering sawing schemes in Pakistan
and these schemes are also offered by GPOs in Pakistan so they must compete them in this field.
If they offer low rates than GPOs so people will go to deposit in GPOs. People concentration
high rates so that’s why sawing PLS accounts are more then current accounts. The next examples
will ATM which substitute presenting cheques at counter and encash it. The NBP is lacking in
this field. It must improve in this field to compete the competitors.

4. Bargaining Power of Suppliers:

The bargaining power of supplier affects the intensity of competition, especially when there are a
large number of suppliers. In case of banks the suppliers are customers they supply the money to
banks. Now they must offer good services, quality, and safety. Low charges etc to customers. In
this field NBP is very good. B/C at offers good quality services to customers. They charge low
charges on remittances. So that’s it is competitions other banks.

5. Bargaining Power of Consumers:

When customers are concentrated or large, or buy in volume, their bargaining power represents a
major force affecting intensity of competition. Now the number customers in Pakistan for banks
are very high. Banks offering variety of products and services to their customers. NBP have a
large number of customs. Now it must offer good services and products to their customers to
attract them to come to NBP.
Conclusion?
22. SUGGESTION:
NBP is an effectively operating and profit making organization and carrying out its activities
under a specified system of procedure. The main regulatory body is State Bank of Pakistan,
which provides policy guidelines and ensures that the money market operates on sound
professional basis. While the head office specifies the whole procedure of function and
operations. This procedure has been modernized with the passage of time with a view to
streamline the approach and underlying procedure for effective overhauling of its own
capabilities so as to bring them at par with international practices.
Here I am giving some suggestions, which in my view can add some input for efficiency and
better performance of NBP as an organization in genera and City branch in particular.

The recommendations are as follows:

1. Professional training
NBP staff lacks professionalism. They lack the necessary training to do the job efficiently and
properly. Although staff colleges in all major cities but they are not performing well. For this
purpose these staff colleges should be reorganized and their syllabus should be made in such a
way to help the employee understand the ever changing global economic scenario.
Banking council of Pakistan should also initiate some programs to equip the staff with
much needed professional training.

2. Delegation of authority
Employees of the bank should be given a task and authority and they should be asked for their
responsibility.

3. Performance Appraisal
The manager should strictly monitor the performance of every staff member. All of them should
be awarded according to their performance and result in the shape of bonuses to motivated and
incite them to work more efficiently.

4. To Over Come Problem of Space and Furniture

In the critical analysis this, problem is discussed. To overcome this problem it is suggested that a
special section should be made inside the branch. Which should only handle the treasury
function, salaries and pensions of federal personnel or the bank should do these functions in the
evening time. Also management should purchase more furniture and arrange them in such a way
which provides maximum space and convenient especially in deposit department and there
should also be convenient sitting place for customers.

5. Transfer
Transfer is not properly carried out. Some of the employees are continually serving at the same
post. They are simply rotated at the same branch. Therefore it is recommended that evenly
rotation of every employee should take place after every three years in different braches of the
bank.

6. Changes in Policies
There should not be any abrupt policies change by the upper management, as this practice hurts
the customer confidences in the bank. Government should make long term policies

7. Need of Qualified Staff

Required, qualified staff should be provided to branch in order to improve the functioning of the
branch. Especially a telephone operator should be appointed.

8. Utility Bill Charges

Bank gets Rs. 2 to 3 to processes a utility bill, and it is very tire, tough and hard job despite this
working resulting in a loss to then Rs 3 to5 per transaction. These charges should be increased to
RS 10 per bill to enable the branch to cover their handling costs and make some profit.

9. Link with the Head Quarter

100 major branches of NBP should established a direct link with the, head quarter
In Karachi, through Internet or Intranet. This will make the functions and decision making of the
management easier and convenient.

10. Credit Card

National bank of Pakistan should start its operation in credit card. These cards are very helpful
for the ordinary customer in general and the business people in particular. To make it mores
secure and to eliminate the misuse of it, the management is required to keep proper security
against the card.

11. Installing Validator and ATM

Validator machine is used to count the currency notes and its installation will help to eliminate to
counting errors and will save time.
This branch is situated in the City, which is supported to be the hub of business activates. In this
area an auto teller machine (ATM) is the need of the hour businessmen can easily check their
balance in the bank and also with draw their money conveniently.

12. Interest on Overdraft:

Overdraft is a short-term credit facility provided by the bank to its trustworthy customers free of
interest. Only bank commission is charge small amount of mark-up on the overdraft, which will
help the bank to improve its revenue position.

13. Clean Loans

Clean loan or clean overdraft is the credit facility extended to the customers to the customers
without any security. These types of small term loans should not be extended to anybody,
because sometime these loans are provided to blue-eyed people of the management and they
become a part of bad debts.

14. Cash Financing

In this mode of financing the amount of credit not utilized by the borrower is remained tax-free.
It is recommended that a small amount of interest should be charge on this amount as well
because the bank gas kept-aside the amount for that borrower and can not advance it anywhere.
15. Decreasing Administrative Expenses
Bank should their administrative expenses. This was Rs 8 billion in the year 2000. That can be
done by lying off the surplus pool of employee with golden handshakes scheme. The branches
that are not much used could also be closed. Employee can also be how to control the bank
expenses. That will give positive results in the future.

16. Needs to be Flexible in credit Policy

As mentioned earlier, NBP is very conservative in advances and loans policy. It reduces the
investment opportunities. Also loans should be given to the small businessmen and the
agriculture sector at the low markup rate. It should adopt flexible credit policy while giving
credit to the agriculture sector.

17. Technological Advancement

I would like to suggest that at least all the main branches of NBP should be fully computerized in
order to expedite the dealing process among bankers and their customers. Every department
should be provided a computer with adequate training (especially Advances, Deposits and
Foreign Exchange departments).
Daily records should be entered directly into these computers, (instead entering the overall daily
transactions after the banking hours). It will not only reduce transaction time, will increase
accuracy but will also be efficient as well.
Not only it will be economical but will also reduce the extra burden of work of the bank. It will
also help in reducing the use of excessive paper work.

18. Staff Relationship

Good relationship among staff member leads to the peak performances in any organization. I
observed that the staff relationship was normal other wise but some time I noticed that there
existed a little conformity among the staff members. Another syndrome from which the staff
suffered was that all of them considered themselves more important than others. Some of the
officers used to say that if I am absent for a day the bank would stop working. So this sort of
attitude is not good because it mars bank image and juniors’ willingness learn and work hard and
in the end will hurt the whole team.

19. Improper Distribution of Work

Proper distribution work leads to success in every organization. Proper distribution of work
prevents the employee from over and under work situation. So for a smooth running of an
organization proper distribution of work is the hint to be followed.
During my internship I observed that there was no proper distribution of work in the bank. I saw
that some of the employee worked like ants other sat idle starting here and there. So this created
a lot of over work situation for while relaxation for other.

20. Favoritism and nepotism

In the City branch during my internship I saw that when some of the employees are transfer to
other places, due to their relation with influential people and with top management they can
cancel their transfer in few weeks, when they are unsatisfied at that place. So I suggest that in the
organization there should be no favoritism, nepotism and politics and their transfer and
promotion should be made on merit and according to the rules and regulations of the bank and
provided favorable environment to the employee to show their performances.

21. Inter Departmental Transfer

I watched during my internship that, there is number of employee who have worked on one seat
for many a year. It can have negative effects motivation of employee who is hard working and
intelligent. Take the example of advances section. In advance section if the employee is transfer
after sixth month or seven month, how can he be able to show his performances and how can he
be able to know the bank customer in a short period of time.

22. Foreign currency Account

For the internship the place I have selected was City branch, which is my forefather land and I
know that from area many people have traveled to other country for different kind of jobs, and I
have heard personal complaint about the unavailability of foreign currency account in banks. So
I thick it is wonderful opportunity for the bank to open foreign currency account.

23. Marketing Policy

The branch should adopt various marketing strategy and promotion strategy to promote the bank
and its product.
The most important in my opinion is personal marketing; it is the most effective of all when you
think in term of branch level. But on the whole organization level, they should arrange the
seminar with in the bank and outside the bank. They should introduce various prizing schemes
just like Allied Bank. Karamad Scheme, Bank Al-Falah (monthly income earning scheme) and
various others.
They should do more advertising through newspaper and media and through channel of personal
contacts.

24. Complaints of Customer

There should be an information desk to provide the information and to receive the complaints of
the customer in the bank.
There is no complaint box available in the branch and not any person appointed to hear the
complaints.

Every person cannot go to the manager for the complaint because most of the people are
hesitant. So I suggest management to install a compliant box in the branch, and recruit a special
person for that guidance of the customer when they are unable to manage some difficulties in
banking matters.

25. Analysis of the Business:

Proper analysis of the business reports should be conducted before extending any type of loan.
For this purpose professional training of the stuff member is required.

26. Organizational Commitment

It is suggested that employees working on daily wages basis should be given some benefits,
which the other employees are getting. Their salaries must increase according to efficiency,
performance and service.
27. Managerial Leadership
In the analysis, we have discussed the difficulties of the assistant in taking any initiative;
therefore it is recommended that the assistants should he given special training to make them
ready for the leadership.

28. Credit Monitoring

The credit department of the bank should carries out vigilant credit monitoring. They should
ensure the proper payment of installments and the mark-up by the borrower.
The staff members who have done all the paper work of the loan extension should perform the
monitoring, as he/she will be having more information about the borrower.

29. Extended Banking Hours

The banking hours may be extended up to six, as being practiced by HBL opposite to it.
Some of the business community due to law and order situation are now reluctant to keep the
fund in their premises and would want to depart with it. Therefore, City Branch may extend the
night banking to cater to demand of this business community. The branch could also be opened
to cater the requirements of this business community
Limited staff:

30. Housing and House Hold Goods loans

Bank should initiate these loans because most of bank’s customers are middle class and they
cannot afford to buy house or house hold goods at once by their own

31. Avoiding Bad Debts

Great care should be taking while extending the loan. Loans should be awarded against
reasonable securities, where market value should be equal to the loan granted.
Policies should be crafted in a way to ensure that no loan is extended on political pressure. SBP
regulation for loan approval should be strictly followed. According to which the current ration of
borrower’s business must be 1:1 and the debt to equity ratio should be 60:40, means the liquidity
position of business should be healthy.

32. Car Financing Scheme

Another financing scheme with the name of “MARE GARE CAR FINANCING SCHEME”
should be initiated This finance scheme will help the general public to buy the car of their choice
in easy quarterly installments The bank monitors will do strict monitoring and the car will be
hypothecated with the bank against the car loan.
Scheme’s implementation plan is give in the next chapter.

Implementation plan
From the above recommendation, two recommendations are selected for implantation plan.
1. IMPLEMENTATION PLAN FOR “MARE GARE CAR FINANCING SCHEME”
Implementation of this financing scheme is initiated to provide long term loans to the general
public for buying their own car in easy installments. This financing scheme will help bank to
increase its revenue immensely
Rules and regulations:
 • Name of finance Mare Gare Car Financing
• Minimum amount of finance Rs. 300000
• Maximum amount of finance Rs. 1500000
• Rate of Mark up (on daily product basis) Rs. 0.43 per Rs. 1000
• Period of finance 3 or 5 years
• Repayment to Bank Quarterly (12 or 20 equal installments)

1.2 Documents required for extension for loan

• Documents of title to car.

• Bank monitoring team approval certificate.
• Car dealer certificate of authentication.
• Insurance.

1.3 Securities Required for Extension of Loan

• To ensure the safe recovery of loan the car will be hypothecated.
• Guarantee of two 17th grade government or semi government officer.
• Personal liability of the borrower.

1.4 Finding out Quarterly Installments

Mark up will be calculated for the whole time period and will be added to the principle amount.
The total of that will be divided by number of installments to get the amount for each
installment.

The formula for extracting mark up is

Mark up =F*R(1+N)
2M
Where
F = Total amount of financing
R = Rate of mark up for one year
N = Total number of installments
M = Number of installments in one year
Case study
Amount of finance Rs. 200000
Rate of mark up Rs. 0.43 per 1000
Total number of installments 20 (5 years)
Number of installments in one year 4
Rate of mark up for one year ® = .43 * 365/1000
=.157
Mark up for the whole financing will be
Mark up = 200000 * 0.157*(1+20)
2*4
= Rs. 82425
Now the quarterly installments will be
Quarterly installment = principal amount + total markup
Total installments
=200000 + 82425 / 20 = Rs. 14121/-
The borrower will pay Quarterly installment of Rs. 14121/-
2. Implementation plan for NBP Bahawalnagar branch “Telephone Operator”
The ingredients of the implementation plan are.
• Need/problem at the branch.
• Qualities of a telephone operator
• Benefits of a telephone operator.
• How the need created and bank’s staff decision.
• The implementation plan cost.

2.1 Need problem at the branch.

Every organization has some problems. NBP Bahawalnagar branch has the problem of telephone
operator. It can save the precious time of not only manager but other staff as well. On the other
hand bank’s communication system was not doing well overall. Therefore as an internee I felt
that there should be a telephone operator who can easily handle this situation.

2.2 Benefits of the telephone operator

It saves precious time of the manager and staff members.
It saves the time of the customers.
• Creates good impression on the customer.
• Communication within the bank improves.
• Communication of Bank with outside enhances.

2.3 How the need was created

The need for telephone operator was created because the staff members would have to leave their
work and attend the telephone but some times it would be a wrong call, other’s call or the calls
which they wanted to avoid this would not only waste their time but also affect their performance
a great deal. Therefore they think it’s useful to have a spare person for this facility.
2.4 Action/Implementation plan cost

Cost of HRM department

Advertisement in newspaper cost 4000
Selection cost 10000
Training cost 12000
Total HRM cost 26000
Telephone networking
Additional telephone sets 2500
Cable (Rs. 5/ foot, 5*800) 4000
Telephone mechanic 2000
Labor 2000
Separate cell cost 5000
Other expenses 2000
Total networking 17500
Total action plan cost 435000

23. RECOMMENDATIONS
 In this section only one topic is discussed that is recommendation.
During my training at Bank NBP I observed some areas that need attention of the management
like:
Bank needs to use more marketing channels to make the public aware of its products and
services. In the presence of intense competition NBP has to realize the importance of marketing.
Management should distribute work equally among different employees. Some of the employees
are overburdened while some sections are overstaffed.
NBP needs to improve its website. More information relating to financial performance of the
bank should be available on the website.

The number of the women hired by the bank is very less. NBP should employ more women.
Moreover it should also recruit women for working in “Credits”.

Bank NBP Limited should immediately improve its Information Technology System. The
soft wares currently in use should be made error free, as it is the need of the hour, and integrated
data interchange should be inculcated to enable top management to monitor all activities going
about in all branches through generation of special purpose reports. There are a disproportionate
number of seasoned bankers in the top management who have the responsibility of making
strategic decisions. This think tank should also include a reasonable proportion of young bankers
whose mindsets teem with new creative ideas, which might prove to be invaluable for NBP
Limited.

The top management should immediately start thinking in terms of rotating the
employees in various departments, as this transforms work force into human capital. If a
particular individual keeps on employing his/her efforts in one sphere of banking it would not
only create a sense of monotony and boredom, but also not help improving the skill set of
employees.

NBP should embark upon an even more aggressive management strategy of expansion of
branch network not only in the local untapped opportunity for NBP.
One of the most pressing needs of the time is to advertise Bank Alfalah Limited in the electronic
media.

PROPER PLANNING
Bank should make a plan to gear up its recovery efforts on war footing and reorganize the
recovery function of global bases. In addition, bank should tighten up control on expenditure

USE OF COMPUTERS
To save the time of the customers and other clients, bank should adopt computerized system for
book keeping and other filling systems. It will increase the efficiency of the bank. I know that
there are some branches which are computerized but most of the branches in various cities of the
country are not computerized. So the bank should mechanize all its branches in the country.

ADOPTION OF ADVERTISING
Bank should launch advertising campaigns through out the year to promote the habits of savings
in the people. Bank should open more branches in the remote areas of the country to get deposits
and idle resources. Bank should provide similar facilities to all its branches in big cities. The
standard of service and other facilities are far better as compared to smaller cities.

PROPER GUIDANCE
Bank should adopt such an induction plan that when a customer opens his account with the bank,
he should be supplied with a booklet which enables him to know the procedure of filling the
cheques and pay-in-slip etc. It will save a lot of time of the bank staff afterward during of the
conduct of the account of that customer.

DIVISION OF WORK
The billing system of national bank of Pakistan must be improved to facilitate the customers and
workers. The work should be divided among the staff e.g. collection of bills, countering of cash
and then entry of these.

CHECK ON EXPENDITURES
Expenditures must be controlled which are very high and unnecessary.
BORROWING AT LOW COST
Deposits must be taken at a lower cost and given at higher interest rate.

24.References
1. Daft l Richerd “Management” 4th Edition Pages 254, 256, 269.
2. Kottler Philip “Marketing Management” Millennium Edition Page 76.
3. Fred R. David “Strategic Management Concepts Cases” 7th edition.
4. www.wikipidia.cpm
5. www.google.com

The END