NATIONAL BANK OF PAKISTAN

NAME
ID
FALL 2011 SESSION
10-01-2012
VIRTUAL UNIVERSITY OF PAKISTAN
Letter of under taking
Original Certificate
Dedication
I dedicated this internship Report to
My family members, Administrator Virtual Campus Mianwali and
Virtual University of Pakistan
ACKNOWLEDGMENT
All the praises are for the AMI!"#$ AA" the Creator of universe the most %racious
& merciful and the basic source of knowled%e, wisdom within and beyond my
comprehension' Allah is the only, who can help us in every field of life' I bow my head
before "IM who enabled me to on this report and helped me to complete this report
successfully' All praises after Almi%hty Allah are due to "($ PR(P")# "A*RA#
MU"AMMA+ ,Peace -e upon "im., the mostly perfect e/alted amon%, 0"(M is
forever a torch of %uidance and knowled%e for humanity as whole'
Afterward I am %reatly thankful to my parents an 1I2345 Instructor for providin% me
e/cellent %uidance to successfully complete my internship report of 2A#I(2A -A26
of Pakistan'
I here by provided a %olden opportunity to perform workin% activities at 2-P for a period
of 78 weeks' #he aforesaid occupancy bestow me precious moment to make learnin% and
%et e/perience of the practice life a successful approach'
I am heartily %rateful to -ranch Mana%er, (peration Mana%er and my supervisor Chief
"ead Cashier of the 2A#I(2A -A26 of Pakistan Musa khel -ranch, who confer me
possibility to enhance my understandin% and knowled%e about the workin% system of
2A#I(2A -A26, which would ultimately useful for my future careers and whose
cooperation enables me to compile this comprehensive report'
Afterward, I am %reatly inbeted to my parents and 1I2345 Instructor and Administrative
Ayya9 shah sahib of virtual campus Mianwali for providin% e/cellent %uidance to
successfully complete my internship report of 2A#I(2A -A26 of Pakistan'

EXECUTIVE SUMMARY
In order to interpret my knowled%e and workin% skills, I have performed 78 weeks
internship at 2A#I(2A -A26 of Pakistan, Mianwali' #he ob:ective of the internship
was to e/plore the issues related to finance and the implementation of financial terms,
which I learnt form my course books' In this report, I have %iven a very brief review of
what I have been seen and felt durin% my internship in customer service, cash clearin%
account loan department, bank deposit, bank receipts, !overnment Receipts, account
openin%, !overnment pensions, Utility bills, remittance and --( and )-; system' I
have mentioned all my active ad passive learnin% in my internship report'
Content
#itle pa%e 4
etter of Undertakin% <
;canned copy of the internship certificate =
+edication >
Acknowled%ement ?
)/ecutive ;ummary 3
Content @ & 8
-rief Introduction of 2-PAs -usiness ;ector 5
(verview of 2ational -ank of Pakistan 47
-rief history 47
-usiness Volume 47
(r%ani9ational "ierarchy Chart 44
(verview of the or%ani9ation 44
2-PAs Product lines 44
P; ;avin% Account 44
2-P Premium Amdani 44
Advance salary 44
A%riculture 1armin% Pro%ram 44
2-P ;aibaan "ome 1inancin% 44
2-P offers A#M Card A#M B +ebit Card 44
Islamic -ankin% 44
1ore Remittance 4<
+emand drafts 4<
Mail transfers 4<
Pay order 4<
#ravelerCs CheDues 4<
etter of credit 4<
#rade finances other business loans 4<
A%ricultural finance 4<
Corporate finance 4<
(ther services 4<
#rade services 4<
Competitors of 2ational -ank of Pakistan 4=
Introduction of all the departments 4=
+eposit Accounts 4=
oan 1acility ,Advances. 4=
!overnment Payer 4=
Receipts for !overnment 4=
Remittance 1acilities 4>
-ills E #raveler CheDues 4>
Cash +epartment 4>
1-R Collection +epartment 4>
"uman Resource Mana%ement 4>
Islamic -ankin% 4>
(nline -ankin% 4>
Plan of my Internship Pro%ram 4?
#rainin% pro%ram 43
Remittance department <3
!ovt' Payments and Receipts +epartment 43
-ills Collection +epartment 4@
+eposit of Current and P; ;avin% Account 4@
Account (penin% +epartment 4@ & 48
Credit or 1inance +epartment 45
I# department 45
Ratio Analysis <7 to <5
1uture Prospects of the (r%ani9ation =7
Conclusion =4
Recommendations =<
Reference & ;ources used ==
Anne/es =>
Brief Introduction of NBP`s Business Sector
2ational bank of Pakistan is the lar%est commercial bank operatin% in Pakistan' Its
balance sheet si9e surpasses that of any of the other bank functionin% locally as well as
abroad' It has redefined its role and has moved from a public sector or%ani9ation into a
modern commercial bank' #he bankAs services are available to individuals, corporate
entities and %overnment' 0hile it continues to act as trustee of public funds and as the
a%ent to the state bank of Pakistan ,in places where ;P does not have a presence. it has
diversified its business portfolio and is today a ma:or lead player in the debt eDuity
market, corporate investment bankin%, retail and consumer bankin%, a%riculture
financin%, treasury services and is showin% %rowin% interest I promotin% and developin%
the countryAs small and medium enterprises and at the same time fluffin% its social
responsibilities, as a corporate citi9en'
It is now listed on the 6arachiEIslamabadEahore stock e/chan%es' 2A#I(2A -A26
of Pakistan is today a pro%ressive, efficient and customer focused institution' It has
developed a wide ran%e of consumer products, to enhance business and cater to the
different se%ments of society' ;ome schemes have been specifically desi%ned for the low
to middle income se%ments of the population' #hese include 2-P Advance salary, 2-P
;aiban, 2-P 6isan +ost and 2-P Cash n !old
#he bank has implemented special credit schemes like small finance for a%riculture
business and industries and administration to Far9G "asna loans to students, self
employment schemes for unemployed persons, publics transport scheme' #he bank has
e/panded its ran%e of products and services o include shariah Complaint Islamic -ankin%
products' 1or the promotion of literature, 2-P recently initiated the annual awards for
)/cellence in literature' 2-P will confer annual awards to the best books in Urdu and in
all prominent re%ional lan%ua%es published durin% the defined period' #he bank is also
lar%est sponsor of sports in Pakistan' It has provided %enerously causes whenever the
need arose'
#he bank has taken various measures to facilitate overseas Pakistanis to send their
remittances in a confinement and efficient manner' In <77< the bank si%ned as a%reement
with 0estern Union for e/pandin% the base for documented remittances' More recently it
has started )lectronic "ome Remittance pro:ect' #his pro:ect introduces technolo%y
based system to handle inward remittance efficiently by ensurin% that the -anks branches
keep a track of the remittance received form abroad till its final receipt' #he numbers of
initiatives have been taken in terms of institutional restructurin% chan%es in the field
structure in polices and procedures in internal control systems with special emphasis on
corporate %overnce, adoption of Capital AdeDuacy ;tandards under -asel UU framework,
in the up %radation of the I# infrastructure and developin% the human resources'
2A#I(2A -A26 of Pakistan has built an e/tensive branch network with over 4<85
branches in Pakistan and operates in ma:or business center abroad' #he bank has
representative offices in -ei:in% #ashkent, Chica%o and #oronto' It has a%ency
arran%ements with more than =777 correspondence banks worldwide' Its subsidiaries are
#aurus ;ecurities td, 2-P )/chan%e Company td, 2-P capital td, 2-P Modarba
Mana%ement Company td, CH;C -ank, Almaty 6a9akhstan' #he banks :oint ventures
are, United 2ational -ank ,U6., 1irst Investment -ank and 2A1A, an Asset
Mana%ement company ,a Hoint venture with 2I- -ank & 1ullerton 1und Mana%ement of
;in%apore.'
Overview of National Bank of Pakistan
Brief History
2ational -ank of Pakistan was established on 2ovember 5, 45>5 under the 2ational
-ank of Pakistan (rdinance, 45>5 in order to cope with the crisis conditions, which were
developed after trade deadlock with India and devaluation of Indian Rupp in 45>5'
Initially the bank was established with the ob:ective to e/tend credit to the a%riculture
sector' #he normal procedure of establishin% a bankin% company under the companies
aw was set aside and the bank was established throu%h the promul%ation of an
(rdinance due to the crises situation that had developed with re%ard to financin% of :ute
trade' #he bank commenced its operation form 2ovember <7, 45>5 at si/ important :ute
centers in the then )ast Pakistan and directed its resources in financin% of :ute crop'
#he banks 6arachi and ahore offices were subseDuently opened in +ecember 45>5'
Bank of the Year 2001I Awarded for the year <774 by the world renowned J#he bankerK
ma%a9ine owned by the 1inancial #imes !roup, ondon'
Bank of the Year 2002I Awarded for the year <77< by the world renowned J#he -ankerK
Ma%a9ine owned by the 1inancial #imes !roup ondon'
2-P is the L 4 bank for payment of remittance over the cash Counters havin% made 4'<
million payments in <775'
2ature of the (r%ani9ation
2ational -ank of Pakistan is a %overnmental (r%ani9ation' It is functionin% as an a%ent of
state bank of Pakistan' It implements the policies of ;-P' Its basic ob:ective was to
e/tend credit to the a%riculture sector' It is the ma:or business partner for the %overnment
of Pakistan with special emphasis on fosterin% Pakistan economic %rowth throu%h
a%%ressive and balanced lendin% polices, technolo%ically oriented products and services
offered throu%h its lar%e network of branches' It deals all !ovt Revenue, collection and
payments of salaries, pensions and !ovt #reasury' It is a complete commercial, retail and
corporate bank as well' 2ational -ank of Pakistan a commercial bank %enerally makes
advances for the period of not e/ceedin% one year, e/cept in case of small and medium
industries for which advance may be made for a ma/imum period of five year' #he bank
makes not only a%ainst the security of stocks and %oods hypothecated or pled%ed to the
bank, but also a%ainst documents of %oods and properly, shares are various :oint stock
companies, !overnment securities, Insurance policies deposits receipts, etc' #he mar%in
and rate of interest are determined by several factors includin% the type of security the
si9e of loan and the inte%rity of the party'
Business volume Rs in ~000
2010 2009 2008
#otal Assets 4,7=?,7<>,387 5>>,?8<,@3< 84@,@?8,@?3
+eposits 8=<,4?4,888 @<@,>3>,8<? 3<>,5=5,743
Advances >@@,?73,?3> >@?,<>=,>=4 >4<,583,83?
Investments =74,=<=,87> <4@,3><,8<< 4@7,8<<,>54
;hareholdersC )Duity 47=,@3<,=47 5>,4>4,545 84,=3@,77<
PreG#a/ Profit <>,>4?,445 <4,=77,4@= <=,777,558
AfterG#a/ Profit 4@,?3=,<4> 4@,?34,8>3 4?,>?8,?57
)arnin%s per ;hare ,Rs'. 4='7? 4='7? 44'>5
2umber of -ranches 4,<85 4,<8@ 4,<@3
2umber of )mployees 43>?@ 43,<>8 4?,>>4
Organizational Hierarchy Chart
PR);I;+)2#
+IR)C#(R;E;)VP;
Provisional ChiefsE)VP
Re%ional ChiefsE)VP
*onal ChiefsE;VP
Vice President
Assistant vice president
(fficer !rad I, II, III
Clerical E2on Clerical ;taff
I believe and my e/perience of internship I have seen that structure of the bank is ok'
-ecause now the 2-P is tryin% to be very professional and try to adopt best mana%erial
practices for improvement in bank operations'
Overview of the organization
NBP`s Product lines
PLS SAVING ACCOUNT
NBP PREMIUM AMDANI
ADVANCE SALARY
KISAN DOST PROGRAM
AGRICULTURE FARMING PROGRAM
NBP SAIBAAN
NBP offers ATM Card
ATM + Debit Card
ISLAMIC BANKING
BANKING ON YOUR FAITH
DEPOSIT SCHEMES
4' Current +eposit ;chemes <' Profit & oss ;harin% ,P;. +eposit ;cheme
FORE REMITTANCE
Send money to your loved ones through legal channels and build a stronger Pakistan
FOREE TRANSFER - I want to send money to an account at any NBP branch in
Pakistan
DEMAND DRAFTS
MAIL TRANSFERS
PAY ORDER
TRALVERS CHEQUES
LETTER OF CRDIT
TRADE FINANCES OTHER BUSINESS LOANS
AGRICULUTRE FINANCE
A. Agricultural Credit:
B' Agricultural Credit (Medium Term):
C. Farm Credit:
D. Production Loans:
CORPORATE FINANCE
Working Capital and Short Term Loans
Medium term Loans and Capital Expenditure Financing
Long structuring and Syndication
OTHER SERVIES
In addition to ;hariah acceptable standard %eneral bankin% services, followin% services
are also bein% offered at the Islamic -ankin% -ranchI
4' etter of Credit 1acility <' "andlin% of Remittances
=' Collection of )/port -ills >' Collection of ocal -ills
?' !overnment Collections 3' Utility -ills Collection
@' Issuance of -ank +rafts and Pay (rders'
TRADE SERVICES
Letter of Credit
4' Advisin% <' Confirmation =' 2e%otiationE+iscountin% >' Reimbursement
Trade Collection Services
4' )/port -ill Collection ;ervices <' +ocumentaryEClean Collection
Payment Services
4' )lectronic Payment E M#47= <' 1und #ransfer E M# <7<
Competitors of National Bank of Pakistan
Competitors of 2ational -ank of Pakistan are all scheduled banks, which are
listedEtradin% under -ankin% Companies (rdinance 453<'
Competitive -anks are as underI
"abib -ank
imited
United -ank
imited
Muslim
Commercial
-ank imited
Allied -ank
imited
Askari Commercial
-ank imited
;oneri -ank
imited
-ank AlG"abib
imited
-ank AlG1alah
imited
;tandard
Chartered -ank
imited
#he -ank of Pun:ab
Introduction of all the departments
1. Deposit Accounts
+eposits are those accounts in which customers keep their savin%s, and there are numbers
of those accounts, like P; ;avin% Accounts, Current Accounts, ;pecial savin% accounts
i'e' Premium ;avin% Accounts and 2-P Premium Amdani Certificates' Usually bank
%ives semiGannually profits on P; ;avin% Accounts as well provides there customer
with certain more facilities' 0hereas in Current AEc Profit is not %iven semiGannually, this
AEc is specially for businessmen, so thatAs why special waivers are %iven to them
accordin% to nature of the account, ike providin% certain free of cost services etc' 0here
else in ;pecial AEcAs profit is %iven on certain rules, like monthly basis profit system on
fi/ed percenta%e of ratio of amount'
2. Loan Facility (Advances)
Advances are one of the types of loans' It may be lon% term as well short term' 2-P
%ives loan to borrowers for their personal or business usa%e' Advances for personal usa%e
are low as compared to business use' At the same time bank is %ivin% advances for
various sectors for various tenure' ;ome of the forms of advances, which are %iven for
various sectors for various tenures, are here as underM ;mall 1inance, Cash 1inance,
A%riculture 1inance, Cash & !old oan, Personal oans, +emand 1inance, Runnin%
1inance, Corporate 1inance, )/port Import 1inancin%, "ouse -uildin% 1inance ,;aiban.
and 2-P 6arobar ;cheme etc' In advances, loans are %iven to the party under some
%uarantee, like pled%in% of land, mort%a%e loans etc'
3 Government Payer.
As 2ational -ank of Pakistan is the main !overnment bank, so because of this reason it
is functionin% as an a%ent of ;-P' All types of !overnment Payments like pension,
salaries of almost every !ovt' dept, *akat, -enevolent 1und, #reasury Refund and #a/es
Refund proceed throu%h the bank' '
4. Receipts for Government
2ational -ank of Pakistan is also actin% as an a%ent of !overnment in the act of receivin%
of %overnment receipts' In this department all types of !overnment receipts i'e'
Revenues, #a/es, Abyana, A%riculture #a/, !overnment 1ees, )(-I 1unds and Utility
-ills are deposited' #his way 2-P is servin% %reat :ob of revenue collection from public'
5. Remittance Facilities
#his department deals in transfer of money from one place to another or country byI
+emand drafts
Mail transfer
#ele%raphic transfer
People send their money to the other persons and or%ani9ations throu%h various way i'e'
-ank draft, #ele%raphic #ransfer, Mail #ransfer, Coupons, !ovt' +raft and 0estern Union
Money #ransfer etc' It works both inward and outward' It is centrally controlled by the
main head office, means all the transactions are further treated by the head office'
6. Bills / Traveler Cheques
Customers collect their moneyEamount throu%h bills' #hey present their CheDue, drafts
and other bills for collection within the city and out of the city throu%h mail' 2ow a dayAs
(nline -ankin% is becomin% more popular for this purpose but the branch where I %ot
trainin% is still not have this facility'
7. Cash Department
2ational bank deals !overnment treasury on behalf of ;tate -ank of Pakistan' #here are
Chest, ;ubGchest and 2onGchest branches in the bank' ;-P supplies currency notes to the
bank and monitors its cash flow, as well the main function of this department is to
controllin% of the spoiled currency noted in the market and it possible that everybody
should %et %ood Duality of currency notes ,sorted notes.'
8. FBR Collection Department
1ederal board of revenueAs collection is one of the very important sources of
%overnmentAs income, for this purpose 2-P is playin% %reat role for collection of 1-R
,C-R. ta/esErevenue' A separate counter is established at branch level to facilitate the
ta/payers'
9. Human Resource Management
"uman Resource plays a vital role in the success of every service or%ani9ation' #hey
interact between man and machine' #heir attitude can win or loose the customer' #he
positive attitude could only be created in a conducive environment, which can make the
staff dedicated towards the or%ani9ation and its ob:ectives' In reality the man is more
important than machine as it is the human which could %et ma/imum out of machine to
keep a happy customer' "owever, most or%ani9ations %ive little importance to this very
important asset'
10. Islamic Banking
Islamic bankin% operation came into e/istence from year <77@' +urin% the year under
review, in addition to active participation in various ;ukuk transactions, two more Islamic
bankin% branches at ahore and Peshawar started operations' 2-PAs plans for the year
<747 include openin% of 1aisalabad and Rawalpindi branches with the focus on %rowin%
or%anically by openin% more standalone Islamic bankin% branches, utili9in% 2-PAs
e/istin% branch network of 4,<77 plus conventional branches and lookin% into strate%ic
acDuisitions for e/pansion in this field'
10. Online Banking
#he functionin% of this department is the online linka%e of other branches with each
othersN this department facilitates its customers to feel at home, because with the help of
online'
Plan of my Internship Program
a. A brief introduction of the branch where I did my internship
I have performed my internship in 2ational -ank of Pakistan atI
Name of Branch
Branch Code
Region
Region Code
Address
Phone #
Name of Manager
Name of Operation Manager
Name of My Supervisor
b. Starting and Ending dates of my Internship
#ime duration of my internship at 2ational -ank of Pakistan is 78 weeks'
;tartin% date is
)ndin% date is
c. Names of the departments in which I got training and the duration of training
+urin% my internship period at 2-P, I %ot trainin% in various departments of the branch'
A brief introduction of these departments is as underN
4' -ank +eposit, -ank Receipts and !overnment Receipts (2 Week)
<' Account (penin%, !overnment Pensions and Utility -ills (2 Weeks)
=' Remittances, --( and )-; system ,2 Weeks)
>' Advances ,!old and Advance salary. and Utility -ills (2 Weeks)
Training program
1. Remittances Department
#his department deals in transfer of money from one place to another or country byI
4' Issuance and #ransferrin% of +emand draft <' Mail #ransfer
=' #ele%raphic #ransfer >' Pay (rders
In this department internees are advised to observe the workin% of transfer of money from
one place to another place of the country by the above modes of transferrin% money'
+urin% my stay in this department, I observed that how demands draft be issued' #he
procedure is as follows'
+urin% my stay in this department, I often made drafts on behalf of customers under
instructions of my trainin% officer' #he procedure is as follows'
1irst the bank receives a written reDuest from the customer to issue a bank draft' #he
written reDuest is either in banks standard form or separate paper si%ned by the applicant
enclosed with cash or cheDue coverin% the amount of the draft and other char%es of the
bank' 0hile issuin% a bank draft, it is compulsory that the draft should be free from
alternations' All the details must be written clearly in ink' After issuance of demand draft,
it is handed over to the applicant' #he bank advice containin% the particulars of the draft
is sent to drawer branch with its necessary information and on its presentation the
payment of the draft is made'
Documents required:
C2IC
In case of M#, account number where to transfer the money is reDuired by bank'
Exchange Rates (Commission)
PakGRupees )/chan%e Rate ,Min. 1)+
4G477,777 ?7 G 7'47O 43O of )/chan%e
477,777G4777, 777 477G 7'?O 43O of )/chan%e
Above 4777,777 >77G 7'>O 43O of )/chan%e
2. Govt. Payments and Receipts Department
I worked much in Pension payment dept' I used to record the amount %iven on the receipt
provided by the customer into pension re%ister' #hen after takin% si%natures of branch
mana%er, affi/in% the stamp on receipt and si%nature or thumb impression of receipt
holder on pension re%ister, customer is asked to receive the amount from cashier' At the
end of the day, I used to make scroll of pension payments also'
2ational -ank of Pakistan is functionin% as an a%ent of ;-P' All types of !overnment
Payment i'e' Pension, ;alaries, !rants, *akat, -enevolent 1und, #reasury Refund and
#a/es Refund proceed throu%h 2ational -ank of Pakistan'
Moreover, in this department all types of !overnment receipts i'e' Revenues, #a/es,
Abyana, A%riculture #a/, !overnment 1ees, )(-I 1unds and Utility -ills are deposited'
In this way, the 2-P is servin% %reat :ob of revenue collection'
In advance salary payment, I worked little but I learnt a lot while workin% in this
department' ;ome features and detail of advance salary is as underI
;alary Account must be maintained in the branch at least si/ months a%o by %ovt' and
semi %ovt' employee only' 1ollowin% documents are reDuired for %ettin% advance salaryI
#hree ;alary ;lips
Undertakin% of Rs'477EG ;tamp paper
#wo reference from work collea%ues , Copy of C2IC.
++( , +rawin% and +isbursin% (fficer. will si%n onI
a. 1orm b. Undertakin%
c. #hree undated CheDues, blank from borrower
Rate of interest is 4@'?7O per annum
Advance salary is calculated in followin% wayI
<7 / 3777 P 4<7,777 will be financed Q 4@'?O pEannum
3-Bills Collection Department:
+urin% my trainin% pro%ram I spent two weeks in bills collection department' "ere I
Collected utility bills like %as, electricity, water and telephone etc'
Collection of %as, electricity and telephone bills'
Makin% scrolls havin% the customer number and the amount paid
Markin% totals
;endin% in mail
Detailed description of the tasks assigned to me. (Details added)
I have performed followin% tasks in various +epartments of 2ational -ank of Pakistan
durin% my InternshipN
4. Deposit of Current and PLS Saving Account
In this department, I :ust observed how they work' ;ome tasks assi%ned to me were as
underI
I was assi%ned responsibility to cross check amount in fi%ures and words written
on CheDues'
I confirm the si%nature of account holder'
I make scroll also for matchin% the amounts %iven in --( and CheDues collected
in hand'
;croll number provides %reat relief in case of mistakes committed in recordin% amounts'
1or e/ample, if I edited the amount of Rs 4777 instead of 47777 then cash scroll of the
branch back office will not match with cash receipt re%ister of cashier at the end of the
day' In order to rectify the amount, we will enter the scroll number in R)V)R;A
column, computer screen will display full record of all CheDues and we will find our
mistake'
5. Account Opening Department
(penin% of an account after verification of customer from 2A+RA database'
Recordin% of account number and name of applicant in account openin% re%ister'
Issuance of letter of thanks
Issuance of cheDue book and pass book
Recordin% of first deposit with the bank by customer in %eneral led%er
Closin% of account after receivin% application from customer'
After getting trained, I was often called for opening account in case of work
overloaded in this department.
Detailed procedure
In this department, I have acDuired the knowled%e re%ardin% the dealin%s of this
department with openin% current and savin% account for its corporate customers and deals
with all other matters' 2ational -ank of Pakistan has subseDuent kinds of customers
under this department'
#rust
;taff
1irm
Company
Individual
A. Confirmation from NADRA
I did confirmation of verification of person by 2A+RA before openin% an account' #he
person %ets himself verified throu%h 2A+RA in order to openin% of an account'
Moreover, the customers have to brin% some reference of those, who already have an
account in 2-P' ;ome important information re%ardin% customer e'%' the name and
account number is written on the space provided on the sample si%nature card'
B. Form of Opening an Account
(n confirmation, such person has been provided with an application form, to fill, known
as Account (penin% 1orm' 2-P has P; #erm account, Premium ;aver account,
Premium Amdan account, Current Account, P; account, P; savin% account' I fill
account openin% form for illiterate and old a%e person, who could not fill their form
himself properly'
#he account openin% form has followin% particularsN
#itle of Account
Address
C2IC 2umber
2#2 2umber ,if available.
Profession
#elephone number may be of office, mobile or residential
C. Account Opening Register
After takin% si%nature E thumb impression, I used to write the name, 2IC number in
account openin% re%ister'
D. Issuance of Cheque Book
I have done work in this department' And I used to issue cheDue book to customer after
takin% the si%nature of operation mana%er' I also record it in cheDue book re%ister and
took the si%nature from customer a%ainst hisEher name' #he cheDue book is issued to all
customers havin% account in bank or to those who want to avail the facility of CheDue
book' 1irst cheDue book is issued to customers who %et the letter of thanks and reDuests
for the issuance of cheDue book and first cheDue book after openin% of new account is
issued free of cost'
Cheque book consists of
P; <? leaves or pa%es per order
C+ ?7 leaves or pa%es per order
A special cheDue book re%ister is maintained by the bank to enter the name of person
havin% cheDue book' It is also si%ned by the customer when cheDue book is handed over
to the customer'
E. Documents Enclosed by Customer at opening of account
All the customers on openin% of account will have to submit the reDuired documents as
per the status of Individual Account, Companies Account, Partnership Account, #rust
Account, A%ent Account and account for Club, ;ociety or Association' I used to confirm,
either all reDuired documents have been provided and enclosed by customer with form or
not'
1ollowin% is the detail of documents %enerally reDuired to be attached by the customersN
Application form
Copy of C2ICE2IC(PEP(C
Copy of drivin% license in case C2IC is without photo%raph
Applicant photo%raph and V2IC copy
Copy of service cardE evidence of employment in case of salaried person
Photo%raphs in case of illiterate person
*akat e/emption declaration
)vidence for e/emption of account from levy of service char%es
6. Credit or Finance Department
In credit department, I was assi%ned many duties, for e/ample' I used to fulfill forms
prescribed for %old loans' I used to take si%natures of applicants and branch mana%er on
loan form' I used to calculate amount after includin% interest char%ed by bank on that
loan'
I calculate interest amount char%ed by bank'
I post in led%er, all the details of applicant, amount of loan, amount of interest,
amount, wei%ht and number of tools in %old pled%ed a%ainst loan etc'
I record all details of applicant and amount of loan in computer'
Preparin% different kinds of documents reDuired for the completion of procedure'
e'% credit voucher, debit voucher and insurance voucher etc'
7. IT Department
In I# department I worked in --( and )-; online system of the bank' I
processedEpunched all vouchersECheDuesEtransactions online and %et different reports e'%
#ransfer scroll, !eneral led%er, clean cash, +ay book current, day book Profit & loss
account, cash scroll, %eneral led%er abstract, %eneral led%er "ead, !eneral ed%er weekly,
+emand draft advised received, +emand +raft advance dispatch, Mt issued, )nd of day
++E!+ balance report, payment order report, 1G<4and ++ Issued' +ispatch different
reports to re%ional office ;ar%odha and head office 6arachi
Ratio Analysis
Net Profit Margin:
#his ratio measures the firmAs profitability of salesE interest earned after takin% account of
all e/penses and income ta/es' #his ratio can be calculated asI
Net profit margin ratio Net Profit after taxes / Interest earned Rs in J777K
Year 2008

Year 2009

Year 2010

Net profit margin ration Net Profit after taxes / Interest earned`100
4?,>?8,?57E37,5><,@58
25.36
4@,?34,8>3E@@,5>@,35@
22.53
4@,?3=,<4>E 8>,8@<,4=>
20.69
)/planationI from the calculation and %raph it is very much clear that the
performance of 2-P is fle/ible and shows ups and downs' It become due to the lack of
products that increase the profit' 2et profit mar%in measures how much of each dollar
earned by the company is translated into profits' A low profit mar%in indicates a low
mar%in of safety' "i%her risk that a decline in sales will erase profits and result in a net
loss' 2et profit mar%in is an indicator of how efficient a company is and how well it
controls its costs' #he hi%her the mar%in is, the more effective the company is in
convertin% revenue into actual profit'
Return on Equity:
ROENet Profit after taxes/Share holder`s Equity Rs in J777K
Year 2008

Year 2009

Year 2010

ROENet Profit after taxes/Share holder`s Equity`100

4?,>?8,?57E47>>?4<7?
14.79
4@,?34,8>3E 4<7@5<??<
14.53
4@,?3=,<4>E 4=4<588=<
13.37
)/planationI from the calculation it is clear that the R() Ratio have appro/ same and
downward trend of 2-P' It is because of low net profit they have earned in year <747' It
tells us the lack of earnin% power on the shareholderAs investments' It is because of
ineffective e/pense mana%ement' Interpretation of the ratio is similar to the interpretation
of return on share holders investment and hi%her the ratio better is' "ere the O is
decreasin% 4>'@5 to 4='=@' R() is decreased due to increase eDuity as a result of increase
in minimum capital reDuirements'
Return on Assets:
#his ratio shows the efficiency of or%ani9ation that how efficiently utili9es their assets'
#his ratio relates profits to assets'
ROA Net Profit after Tax/Total Assets Rs in J777K
Year 2008

Year 2009

Year 2010

ROA Profit after Tax/Total Assets`100

4?,>?8,?57E84@,@?8,=<3
1.89
4@,?34,8>3E5>>,?8<,@3<
1.85
4@,?3=,<4>E4,7=?,7<>,387
1.69
)/planationI from the calculation it is clear that the R() Ratio downward trend of 2-P'
It is because of low net profit they have earned in year <747 due to improper mana%ement
and e/panses raised up' It shows that 2-P usin% itAs assets inefficiently in <747' Return
on Assets is a stable indicator of how profitable a company is before levera%e' It is also a
measure of the productivity of an enterpriseAs total resources, and is used to assess
mana%erial performance as it measures a mana%erAs ability and efficiency in creatin%
wealth'
Total debt ratio
#otal debtE#otal assets Rupees in J777K
Year 2008 Year 2009 Year 2010
Total debt ratio Total debt/Total assets
@4?,<55,478E84@,@?8,=<3
0.87
8<?,3@3,=8>E 5>>,?8<,@3<
0.87
573,?<8,8?<E 4,7=?,7<>,387
0.87
#his ration is directly related to risk hi%h ratio means hi%h risk and low ratio means low
risk' 1rom calculation it is clear that the ratio is same for three years' #his ratio serves the
similar purpose to the debt to eDuity ratio' #his ratio is hi%h because of more deposits in
the bank, and deposits are the liability of customer on bank
Debt to Equity Ratio
#otal +ebt E #otal )Duity
Year 2008 Year 2009 Year 2010
Total debt ratio Total debt/Total Equity
@4?<55478E84,=3@,77<
8.79
8<?3@3=8>E 5>,4>4,545
8.77
573,?<8,8?<E 47=,@3<,=47
8.73
It is important to reali9e that if the ratio is %reater than 4 the ma:ority of assets are
financed throu%h debt' If is smaller than 4, assets are primarily finance throu%h eDuity'
"ere the ratio is %rater than 4' It means the handsome deposit in the bank and customer
has a faith on bank for their savin%s'
Advances deposit Ratio
Advances deposit ratio = Advances/ deposit Rs in
billions
Year 2008

Year 2009

Year 2010

Advances deposit ratio Advances/ deposit ` 100

>4<,583,83? E 3<>,5=5,743
66.08
>@?,<>=,>=4 E @<@,>3>,8<?
65.32
>@@,?73,?3> E 8=<,4?4,888
57.38
1rom above table and %raph it is clear that the ratio is downward in <775 and same
pattern continue in <747' 0hich means the efficiency on 2-P is not %ood and they have
to use their deposits inefficiently in advancin% to borrowers' "ere hi%h ratio is reDuired'
#he ne/t side of the picture is that the people will think that is risky to deposit the money
in the bank' #he bank has to use lenders money in best way in future' It means that for
every 477 of deposit solicited by the bank, it is able to lend 3>, 3? and ?@ O in last three
years' -anks are reDuired to maintain a certain level of deposit reserve' 1or this reserve
reDuirement, the bank can invest the funds in loans so as to make the funds earn or
productive'
Earning per Share
Year 2008

Year 2009

Year 2010

11.49 13.05 13.05

)/planationI 1rom above table and %raph it is very much clear that 2-P share holder
receives %ood and increased earnin% per share in previous years'
Operating Cash Flow Ratio
Cash 1lows from (perationsECurrent iabilities Rupees in J777K
Year 2008

Year 2009

Year 2010

Operating Cash Flow RatioCash Flows from Operations/Current Liabilities`100

<?=<384E?7<3==?<
5.03
<4,=77,4@=E??>>5=7@
38.41
<>,>4?,445E<@33=8=8
88.25
#he operatin% cash flow ratio helps %au%e a companyCs liDuidity in the short term' Usin%
cash flow as opposed to income is sometimes a better indication of liDuidity, because
cash is how bills are normally paid off' "ere is a %ood operatin% cash flow since <775'
#hat is positive and %ood si%n for bank performance'
Times Interest Earned Ratio
Earnings before Interest and Tax / Net Interest Expense Rupees in J777K
Year 2008
Times
Year 2009
Times
Year 2010
Times
Times Interest Earned Ratio Earnings before Interest and Tax / Net Interest Expense
37,5><,@58E45?7<787
3.12
@@,5>@,35@E<=?4=85@
3.31
8>,8@<,4=>E<3,>35,>57
3.20
A #imes Interest )arned Ratio that indicates the e/tent to which earnin% can decline
without resultin% in creditors problem due to nonpayment of interest' #his is a useful
calculation to tell if a company is runnin% into financial trouble' If a company cannot at a
minimum pay the interest on its debt, then the company may be headed for serious
financial trouble' #he lar%er the #ime Interest )arned, the more capable the company is
at payin% the interest on its debt' "ere the time interest earned ratio is appro/imately
same in last = years' #he bank has to improve the earnin% share to deal batter way in
interest e/panse of bank'
Price Earnings Ratio
Price )arnin%s Ratio P Market price per eDuity share E )arnin%s per share
Year 2008
Times
Year 2009
Times
Year 2010
Times
Price Earnings Ratio Market price per equity share / Earnings per share
4777777E4@'<=
58038.305
4@7,84>E4='7?
13089.19
?>7,734 E4='7?
41383.98
#he most common measure of how e/pansive a stock is' #he hi%her the PE) ratio, the
more the market is willin% to pay for each dollar of annual earnin%s' "ere the value is
decreased in last = years from ?87=8'=7? to >4=8='58' "i%h PE) su%%ests that investors
are e/pectin% hi%her earnin%s %rowth in the future compared to companies with a lower
PE)'
Dividend per Share
(+ividends on (rdinary ;hares. E ,2umber of ;hares Issued. / 477
Year 2008
Rs/share
Year 2009
Rs / share
Year 2010
Rs/ share
Dividend per Share=(Dividends on Ordinary Shares) / (Number of
Shares Issued) x 100
<8@85=<E47,@3=,@7<
26.74
4,5<7,==3E47,@3=,@7<
17.84
4,755,>5=E4=,>?>,3<8
8.17
"ow much earnin%s have been %enerated per one share of stock durin% the period
reported' "ere the earnin% share is reducin% for last = years' +ividends are a form of
profit distribution to the shareholder' "avin% a %rowin% dividend per share can be a si%n
that the companyCs mana%ement believes that the %rowth can be sustained'

Gross Spread Ratio
!ross ;pread for -anks P ,2et Markup IncomeE!ross Income. Rupees in J777K
Year 2008

Year 2009

Year 2010

Gross Spread for Banks (Net Markup Income/Gross Income)

=@7?87=7E375><@58
60.80
=@,>?8,7>8 E@@,5>@,35@
48.05
>=,<<4,3?8E 88,>@<,4=>
48.85
#ypically, a hi%her spread indicates a hi%her profit mar%in for the bank' Althou%h you can
%au%e some future trends throu%h ratio analysis, you cannot predict future variances'
#here is no such thin% as a tool that can predict future deposits at a bank'
#he spread is the difference between funded revenue as a percenta%e of earnin% assets
such as loans and the value of the funds as a percenta%e of avera%e payin% funds such as
depository accounts' !ross spread ratio is decreasin% because the decrease in mar%ins'
Non Interest Income to Total Income Ratio
2on Interest Income E #otal Income RatioR477
Year 2008

Year 2009

Year 2010

Non Interest Income to Total Income RatioNon Interest Income / Total Income
Ratio`100
43>4?83<E=@,7?8,7=7
44.29
45,475,==<E=@3@3?7?
50.71
48,4?7,88=E >=?443=@
41.71
It e/presses the income from operations as a percenta%e of total income' #he main
sources of income of -ank are in advances and deposits' "ere the percenta%e is near ?7
that shows the better performance'
Du Pont Return on Assets Ratio
#his ratio shows the efficiency of or%ani9ation that how efficiently utili9es their assets'
#his ratio relates profits to assets'
2et Income R / ;ales Assets
;ales Assets / )Duity
Du Pont Return on Assets Ratio Net Profit after Tax/Total Assets Rs in J777K
Year 2008

Year 2009

Year 2010

Du Pont Return on Assets Ratio

2et Income R / ;ales Assets R 477
;ales Assets / )Duity
4?,>?8,?57E37,5><,@58 R
37,5><,@58E84@,@?8,=<3 R
84@,@?8,=<3E47>>?4<7?
14.79
4@,?34,8>3E@@,5>@,35@ R
@@,5>@,35@E5>>,?8<,@3< R
5>>,?8<,@3<E4<7@5<??<
14.53
4@,?3=,<4>E 8>,8@<,4=> R
8>,8@<,4=>E4,7=?,7<>,387 R
4,7=?,7<>,387E
4=4<588=<
13.37
)/planationI It is because of low net profit they have earned in year <747' It shows that
2-P usin% itAs assets inefficiently in <747' A combination of financial ratios in a
series to evaluate investment return' #he benefit of the method is that it
provides an understandin% of how the company %enerates its return'
If R() is unsatisfactory, the +u Pont analysis helps locate the part of the
business that is underperformin%' "ere the O is reducin% from 4>'@5 to
4='=@O'

Future Prospects of the Organization
#he bankAs principal strate%ic %oin% forward ob:ective is to make the transition from a
publicAs service institution to modern commercial bank' #he bank is uniDuely poisoned to
levera%e its lar%e branch network and its 5 million customer base to consolidate its core
business as well as develop new revenue %eneratin% opportunities'
#he -ankAs mana%ement team tryin% to combine work to%ether bankAs e/istin% personnel
with professionals recruited form outside'
(peratin% procedures are bein% reGdefined ands internals controls stren%then utili9in% a
revamped I# architecture' ;ome details on some critical areas as followsI
Corporate & Investment Banking
A new approach to corporate bankin% is underway' #he -ank has initiated a structured
approach to corporate bankin% by introducin% a sin%le point of contact throu%h
Relationship Mana%ers ,RMs.' 1or this purpose, new RMs as well as team leaders has been
inducted to e/pedite this process' Area Mana%ers will be appointed to mana%e relationships
and to better service the needs of multinationals and lar%e local corporate'
1urthermore, to stem the %rowth in nonGperformin% loans, the e/istin% risk E credit
mana%ement practices at the -ank are bein% revamped' In investment bankin% team has
also been formed to offer speciali9ed services to ma:or relationships includin% advisory and
debt syndications ,#1Cs.'
Treasury / International Banking
#he dere%ulation of forei%n e/chan%e treasury business has ensured that a %rowin% volume
of business now flows throu%h the interGbank market where rates are determined by the
market forces' #his can prove to be an immense profitable proposition for the -ank'
#owards this ob:ective, the -ank is shiftin% focusin% on e/pandin% its market share in trade
finance, home remittance and forei%n investment related fore/Gdenominated fows.
Conclusion
Part 1. #he 2ational -ank continues to show a commitment to a customer and
tryin% to increase the better relation with them' A vast difference e/ists between theory
and practice and 2-P has written procedure but practical work done by employees is a
bit different from written procedures' -y analy9in% the financial statements of the bank, I
came across to know that most share taken by 2-P' 2o doubt professionalism and
internal control of the bank are one of the ma:or issues which may results some ma:or
losses to the bank' 1avoritism in hirin% and political influence should be removed' Most
of the customers shifted their account to the 2ational ;avin% Center because of the low
rates of savin% deposit discoura%es the customers' -ank should increase their profit rates
to attract customers' )fficient bankin% is one, which does not emphasi9e on number of
accounts but on %reater amount of deposits' 2-P is more interested in increasin% its
number of account irrespective to its deposit' #he main reason behind it is that bank does
not provide personali9e service to all the account holders and does not improve its Duality
and services' #he -ank employees are doin% very little on their own to e/plore the
possibilities of sellin% bankin% services to them as a marketin% contributor' #he entire
-ank community should make a conscious effort in addition to their normal work to
e/plore the possibilities of sellin% bankin% services to them' 2A#I(2A -A26 Musa
khel -ranch was not online when I start my internship' After > weeks on 47
th
2ovember
<744 start this branch online workin%'
Part 2. Personal loan and Cash & !old oan are very profit oriented products of
bank' It increases the overall profit mar%in of bank' -ank has to initiate more offerin%s
like auto finance' 2-P is the mainstream collector of %overnment collection' If bank fully
online in comin% months than it will be more stren%then the ima%e a%ainst competitors'
Net Profit Margin is reducin% from <? O to <7 O' #hat can be increased throu%h Cut
down on unnecessary e/penses and Increase sales' Total debt ratio is 7'8@ for last =
years' #his ratio is hi%h because of more deposits in the bank, and deposits are the
liability of customer on bank' #hat shows %ood for bank' #he lar%er the Time Interest
Earned, the more capable the company is at payin% the interest on its debt' "ere the time
interest earned ratio is appro/imately same in last = years' #he bank has to improve the
earnin% share to deal batter way in interest e/panse of bank' Earning Per share can be
improve more with doin% a better :ob at runnin% their bank is the best way to increase the
)P;' And reduce the number of shares on issue a %ood idea providin% the shares are
sellin% at below what they are worth they are bou%ht back' The operating income
margin is more than =7O for last = years' #hat shows %ood for bank performance and
)arnin% per ;hare increases from 44'> to 4='7?' Gross Spread Ratio is decreasin% and
bank has to maintain %ood ratio like as in year <778' 1or this sector bank has to initiate
%ood profitable products in market like credit card, auto finance etc' Advances deposit
Ratio is improvin% from 33 O to ?@ O in last three years' #he hi%her the ratio the more
banks are relyin% on borrowed fund which are %enerally more costly than most types of
deposits' Return on Assets is decreasin% in last = years' It is because of low net profit
they have earned in year <747 due to improper mana%ement' It shows that 2-P usin% itAs
assets inefficiently in <747' Return on Equity is decreasin% from 4>'@5O to 4='=@ O' It
can improve with wider mar%ins on sales and hi%her turnover a%ainst different products
like advance salary, cash n !old etc' Dividend per Share is reducin% in last three years
that can be increase with Increases in profits ,earnin%s.'
Recommendations for Improvement
-ank can increase its profit ratio by reducin% e/tra e/penditures and to enhance
the volume of advanced especially retail loans' #hose facilitate the customer and
increase the revenue volume' Trust and reliability creates chances to
enhance deposit and proftability.
2ational bank of Pakistan should start its operation in credit card' #hese cards are
very helpful for the ordinary customer in %eneral and the business people in
particular'
-ank should their administrative e/penses' #his was Rs <<,?@4,>@7 in the year
<775 and <3,<7<,?@@ in year <747' #hat can be done by lyin% off the surplus pool
of employee with %olden handshakes scheme' #he branches that are not much
used could also be closed' )mployee can also be how to control the bank
e/penses' #hat will %ive positive results in the future'
Another very important thin% which is i%nored in the bank is appreciation if the
employee on their %ood performance' If hard work and performance of employees
is not reco%ni9ed and appreciated they become dishearten which results in decline
in performance'
2-P should start its operation in credit cards' #hese cards are very useful for the
ordinary customers in %eneral and business in particular' 2-P is %overnment bank
and this product is very profitable'
In my opinion the process of a transaction should be short in order in save time
for both customers and the bank' ike cash n !old is very short period process'
#he -ank employees are doin% very little on their own to e/plore the possibilities
of sellin% bankin% services to them as a marketin% contributor' #he entire -ank
community should make a conscious effort in addition to their normal work to
e/plore the possibilities of sellin% bankin% services to them'
With the help of marketin and promotions its vast network of
domestic and overseas branches can help to e!pand business.
2-P can attracts the customer with modern style of bankin% and %et the
reasonable deposits with %ood ;ittin% arran%ement, air conditionin% and new
furniture should be facilitated for employee as well as customers'
#he security level in the bank should be enhances especially where I %ot
internship and operation of Mobile phones must not be allowed inside the bank'
1or this purpose the security staff hired by bank itself'
#here e/ists no re%ular and specific system of the removal of customer
complaints' 2ow a day a need for total customer satisfaction is emer%in% and in
their demandin% conseDuences customerCs complaints are i%nored'
#he -ank should increase profit rate on deposits and savin% schemes especially
for pensioners and old a%e citi9ens' -ank should increase the confidence level in
customers'
Reference & Sources used
0ebsite of the -ank www'nbp'com'pk
)conomic -ulletin Vol' =8, 2o' > HulyGAu%ust <744, published biGmonthly by
)conomic research 0in%, 2ational -ank of Pakistan'
)conomic -ulletin Vol' =8, 2o' = MayGHune <744, published biGmonthly by
)conomic research 0in%, 2ational -ank of Pakistan'
1inancialsG"alf $early Account Hune =7, <744'
Annual Report <778, published by 2-P, "ead (ffice 6arachi'
Annual Report <775, published by 2-P, "ead (ffice 6arachi'
Annual Report <747, published by 2-P, "ead (ffice 6arachi'
Annexes
"#$ product #rochure