CHAPTER ONE

INTRODUCTION
1.1 Background
Development of any nation is possible if there is optimal utilization of its resources. So,
the sound financial system of a country plays a major role in its development. Nepal is a
one of the Least Developed Country having more people under poverty line. Despite of
the poor performance in many sectors and political instability, Nepalese financial sector
is growing day by day in the form of commercial bank, co-operatives, finance companies,
etc. and is becoming one of the leading factors in the growth of the countrys
development by showing consistency in its growth and boosting economic factors such as
employment, capital adequacy, effective investment, efficiency in trade etc. Because of
this reason many of the Nepalese students are attracted to the study of Banking and
Finance.
Banking and Finance is a vast subject where each and every factor and activities
undertaken by the financial market are carefully studied. Financial market comprises of
different kinds of financial institution, and one of the major financial institutions in
financial sector is commercial bank. Commercial bank performs different kind of
financial activities, but basically it does the job of accepting saving and lending it or
investing savings in productive sectors.
The volume of credit extension or credit lending of the bank largely depends upon its
capacity of collecting saving or deposit base. So, the deposit collection function
performed by the bank is very crucial task, because it leads to capital formation, which in
return generates opportunities for effective investment and help in economic development
of the country.

1.2 Study Background

This project report is submitted in partial fulfillment of the organization for the degree of
Bachelors in Business Administration. It is an essential part of BBA program that helps
students to acquire professional qualities through activities done under the supervision of
different professionals in the organizations. It gives tremendous opportunities to apply the
knowledge learnt in the classroom on real life industrial problem. Similarly this will
support students to acquire social, technical and communication skills to works
effectively in the organization.
The four year bachelors of business administration at Shanker Dev Campus, Tribhuvan
University (TU) require students to undergo an extensive internship program, in the last
semester, final year, for 8 weeks in a business organization. The internship program,
which the BBA students undertake, targets to provide the practical exposure, to train and
prepare students for managerial functions to develop work culture within them, to uplift
their interpersonal and communication skill encouraging them to interact with the people
in the organization.
This report is mainly focused with the internship activities and the overall overview of
the subject matter that are being carried out by the internee at Everest bank limited during
the period of the 8 weeks from 30th May 2011 to 25th July 2011 on the subject matter and
activities related with general banking.
Everest Bank Limiteds major objective is to upgrade the countrys economy by
supporting the business areas. The study is mainly focused on Deposit Schemes of
Everest Bank Limited. CSD is one of the major functions of bank. A success of bank
largely depends on the satisfaction of the customers. It was a great opportunity to work as
an intern in Everest Bank Limited, branch office, New Road. This experience gave an
opportunity to gain practical experience about working in an organization and utilize
conceptual knowledge in specific area of study.

1.3 Objective
The objective of the study is to explain the experience gained during the internship
period, to develop the conceptual and analytical knowledge about the banking sector in
Nepal. The internship provides opportunity to gain practical experience on working in an
organization and utilize conceptual knowledge in specific area of the study. The main
objective of report, therefore, is to explain the major facts learnt during the internship
period. At the same time it intends to highlight the problems and provide
recommendations for solving the problems faced by interns as well as the concerned
departments staffs of the bank. Besides that, the following are other general objectives of
this study:

To develop skill to maintain good customer relation

To know procedures of Customer service department.

To collect the experience of the working environment of EBL

To gain practical knowledge of the banking activities in the Nepalese market.

To get acquainted with general banking activities

To enable us to understand how theory knowledge differs from the practical life.
Thus, enabling us to understand the complexity and unforeseen nature of problem
and opportunity that exist in the country.

To know about the deposit schemes of Everest Bank Limited

1.4 Scope of the study

Internship is a path that makes the student gain practical knowledge. All the theoretical
knowledge that has been previously studied is implemented practically. The study serves
the greater importance to the students like me because we get the actual practical
exposure of organization functioning and is able to know how much the academic
knowledge and principles are utilized in reality. This helps to develop managerial skills as
well as gaining job experience which is one of the basic requirements in the recruitment
of new employees.
Besides this, internship is also helpful to the organization. Organization can recruit the
employees by observing the work of the intern on the basis of their work skill and
3

decision making ability. This doesnt require the evaluation of their academic
qualification alone and later incurring significant costs to train them at their works.

1.5 Methodology
1.5.1 Organization selection
Organization selection is a crucial factor in an internship program, because it is the place
where the internee gains knowledge of the practicality of what they study. I selected
Everest Bank Limited to do the internship because the organizational layout and setting is
very pleasing and tempting to work. It has required departments thus have huge
opportunities explore and learn about how different departments in a bank function and
work.
For selecting the organization, I visited EBL personally. Then I dropped a
recommendation letter from college along with a cover letter and a CV in human resource
department of EBL. There were other numerous applicants for internship. Since the
decision was not so easy, the bank required few weeks to decide. During this period I
regularly followed up to the human resource department as I was very much keen in
doing my internship in EBL. After two weeks, I was informed about the selection and
could start internship. Finally, I joined the bank as an intern. During internship period I
was placed at the New Road Branch (2nd big branch of EBL).

Entering in real work environment was really a scary one. At first I found it very
uncomfortable to step in that new environment as I was not acquainted with it but with
the passage of time I adapted in it as it was really interesting and the work environment
was friendly enough.
1.5.2 Placement
Regarding placement, internee was not placed in single department. Interns in EBL are
rotated according to the requirements. The main reason of the rotation was to let the
interns gain knowledge about the working procedures and to let know the connections
4

within the departments. The support and cooperation that internee got in the bank was
instrumental. Internee was placed in:

Customer service department

Clearing department

Remittance department

Credit department

1.5.3 Duration
The duration of internship period defined by Tribhuvan University is eight weeks.
However, during the period of internship the placement on departments is fixed by the
bank itself but it is being divided in a nice manner such that it will be easy enough to
understand the work environment.
Project Activity

Week Number
1
2
3

Customer Service Department

Clearing Department
Remittance Department
Credit department
Table 1: Representing no of weeks and activities performed

1.5.4 Activities performed in organization

The activities that I performed in the bank are very useful to understand the working
process in the bank and they are as follows:
Name of the department

Types of activities

1. Customer Service

Performed
Dealing with customer.

Department

Preparing cheque book.

Printing statement.

Taking the forms for verification.

5

Outward bills collection (OBC).

Checking customers transaction and balance on request.

Informing the customers if their pin code of ATM card

has arrived.

Accepting different documents that arrive and entering

them in the register.

Taking the documents arrived to the concerned

department.

Filing the forms as per the name of the product.

Distribution of various forms such as of e-banking, SMS

banking, pay bill, etc.

Helping them to fill the form.

Informing Customer about different types of account and

other queries they have about the operation of bank.

2. Clearing Department

Observed inward clearing of cheques.

Observed outward clearing of cheques.
Observed Transferring of swift transfer.
Printing reports of OBC.
Sending the cheques to NRB.
Informing the customers if their cheque has been returned
from NRB.
Recording the details about the cheque being returned and
the cheque that is being returned to the customers.
Photocopying.

3. Remittance Department

Faxing swift transfer messages to head office.

Observed the working of remittance department.
Filling the debit voucher.
Faxing swift transfer messages to head office.
6

 Helping the customers to fill in the forms of different

remit like the form of western union, Everest remit, etc.
Verifying the remitter, place from where money has been
received and issuing the voucher to draw money.
4. Credit Department

Preparing Bi.Bi.Ni form no 4.

Informing the customers if their guarantee has expired.
SWIFT transfer to the head office.
Scanning the documents and sending them to the
concerned place usually to TFSU.
Prepare the cheques.
Filing and photocopy.
Calculation of OD limit.

1.6 Limitation of the study

The limitations of the study are as follows:

As the internship is to be completed within a limited time period of 8 weeks, it

was impossible to study all the activities of the entire department in-depth.

Many information and use of the Finnacle system was not entertained as it
was against the policy of bank.

Plenty of the things that internee learns is through observation.

Since EBLNR is situated in central area, it conducts high volume of

transactions everyday as such the employees hardly could take out time for
my queries.

Presentation in this report is entirely based on whatever internee is able to

learn in 8 week span due to the restrain of sufficient information, data and
resources.

Sometimes internee has to stay idle not knowing what shall be done as the
employees are busy doing their respective job.

CHAPTER TWO
7

INTRODUCTION OF INDUSTRY
2.1 Introduction of Banking
Bank is a financial institution that deals with monetary transactions. The main function of
bank is accepting deposits and advancing loan. Bank collects scattered money from
public in the form of deposit by providing them certain percent of interest and distributes
the accumulated fund to others, who are in need of money by charging certain percent of
interest, which is usually higher than the interest that it gives to the depositors. Bank can
also be termed as an intermediary, which bridges the gap between the savers of fund and
users of fund. Nowadays, bank provides financial as well as non-financial services to its
customers. Bank is associated directly and indirectly with all the people in day-to-day
transactions, so it is very important to know the precise meaning of Bank. The following
are the few definitions given by different authors:
Bank is an establishment for the custody of money received from or on behalf of its
customers its essential duty is to pay their draft on it, its profit arises from its use of the
money left unemployed by them.
The Shorter Oxford English Dictionary
Bank is a financial institution, which provides financial services that may be in the
form of accepting deposits, advancing loan, providing necessary technical advices,
dealing over foreign currencies, remitting funds, etc.
Nepal Rastra Bank act 2002

2.1.1 Evolution of Banking Industry

The evolution of banking industry had started a long time back, during ancient times.
There was reference to the activities of the money messengers in the temple of Jerusalem
in the New Testament. In ancient Greece the famous temples of Delphi and Olympia
serve as the great depositors for peoples surplus funds and these were the centers of the
money lending transaction. The history of banking is nearly as old as civilization. In the
8

ancient Rome and Greece, the practice of storing precious metals and coins at safe places
and loaning out money for public and private purpose on interest was prevalent. In
England, banking had its origin with the London goldsmith who in the 17th century
began to accept deposits from merchants and others for safe keeping of money and other
valuables.

2.1.2 Banking Industry in Nepal

In the country, the development of banking is relatively recent. The record of banking
system in Nepal gives detail account of mixture of slow and steady evolution in the
financial and global economy of Nepalese life. The history of banking in Nepal can be
traced back to 1877 A.D. when Tejarath Adda was established by the government to
provide credit facilities to general public. These unorganized institutions although quite
underdeveloped could still mobilize funds from wide range of different sources. Although
the Tejarath Adda was established, it was not able to facilitate the growing trades with
Tibet and India. Thus a need for the establishment of a modern bank had become
essential to promote the trade of the nation. In the year 1923 Treaty of peace and
Friendship were concluded between the Government of Britain and Government of
Nepal. As per the treaty, Nepal could carry on import trade free of duty via India. In other
words, it meant that Nepal was going to diversify its foreign trade and for that the country
needed a modern bank. But it wasnt till 1936 A.D. that the Udyog Parishad (Industrial
Development Board) was set up.
Thus, the Udyog Parishad helped in opening new avenues for the advent of banking,
industry and commerce in Nepal and thus helped to enhance the economic status of the
country. A year after its formation, the Udyog Parishad formulated the company act and
the Nepal Bank Act in 1937 A.D. which established the Nepal Bank Ltd. with the
technical cooperation of the Imperial Bank of India, as the first commercial bank of
Nepal.
Before 1956 Sadar Mulukikhana Adda (local treasury of the government) issued
currency notes and the foreign exchange reserves of Nepal were maintained by Reserve
Bank of India. During that period the Indian currency along with Nepalese currency was
9

circulating in the economy. Thus to manage the circulation of national currency and to
maintain exchange rate stability, there was an urgent need for the establishment of a
Central Bank. In 1956, The Nepal Rastriya Bank Act was formulated and Nepal Rastra
Bank was established as a central bank on April 26, 1956. It took over the functions of
Mulukikhana Adda Government Treasury and started issuing currency in 1959; and
also thus relieved the various Mal Addas (Revenue Offices) of their work. Thus it helped
the government to perform treasury functions and stabilize the exchange rate. In Nepal,
the banking industry is divided into four groups, commercial bank, development bank,
financial institutions and micro credit. Here, I have focused on commercial bank.

2.2 Commercial Bank

Commercial banks can be described as a type of financial intermediary. In the US, the
term is used to refer to any banking organization or division that deals with the deposits
and loans of business organizations. The term commercial bank is used to differentiate
these banks from investment banks, which are primarily engaged in the financial markets.
Commercial banks are also differentiated from retail banks that cater to individual clients
only.
In non English-speaking countries the term commercial bank is used interchangeably
with the term trading bank. Commercial banks play a number of roles in the financial
stability and cash flow of a countries private sector. They process payments through a
variety of means including telegraphic transfer, internet banking and electronic funds
transfers. Commercial banks issue bank checks and drafts, as well as accept money on
term deposits.
Commercial banks also act as moneylenders, by way of installment loans and overdrafts.
Loan options include secured loans, unsecured loans, and mortgage loans. A secured loan
is one where the borrower provides a certain property or asset as collateral against the
loan. The main condition of these loans is that if the loan remains unpaid, the bank has
the right to use the property in any way they like to realize the outstanding amount.
Unsecured loans have no collateral and therefore command higher interest rates. There
are a variety of unsecured loans available today and these include credit cars, credit
10

facilities such as a lines of credit, corporate bonds, and bank overdrafts. Mortgage loans
that are provided by commercial banks are similar to secured loans but are used
specifically to buy real estate property for commercial purposes.

2.2 Importance of commercial banks

The banks play very important role for the economic development of the country. The
importance can be examined as under:
1. Increase in saving: The people deposit their savings into the banks and the bank pays
reasonable profit on these savings.
2. Increase in investment: The money which is collected by the bank is lent to
businessman and industrialist. The increase in the investment increases the level of
employment.
3. Increase in employment: The banks advance loan to the investors. As a result; the
industrial units are setup in different parts of the country. Hence the level of employment
is increased.
4. Transfer of Money: When the people want to transfer their money from one place to
another place, they get travelers cheque and the bank draft from the bank.
5. Loan to Government. When the government needs funds to complete the public
works programs, the banks provide loans to it.
7. Balanced development: When the banks provide loans to the less developed areas, the
chances of progress and development are increased in the areas. Banks are back bone for
the economic development of any country. A planned banking system is indispensable for
economic growth and development of the country

11

2.3 Functions of Commercial Banks

Commercial bank's function can be categorized into two types, they are:
1. Primary or Principal Function:
Primary or principal function of commercial banks is of three types.
A) Acceptance of Deposit
An important function of commercial banks is to attract deposit from the public. Those
people who have cash account and want their safety; they deposit that amount of banks.
Commercial banks accept deposits every class and source and take responsibility to repay
the deposit in the same currency whenever they are demanded by depositors.
B) Lending
Another function of commercial banks is to make loans and advance out of the deposit
receive in various forms. Bank Apply the accumulated public deposits to productive uses
by way of loans and advances, overdraft and cash credits against approved securities.
C) Investment
Now- a- days commercial banks are also involved in Investment. Generally investment
means long term and medium term investments.

2. Secondary or Ancillary function:

Secondary or Ancillary functions are two types:
A. Agency Services
1) Collection and Payment of Cheques
2) Standing Instruction
3) Acting as correspondence
4) Collecting of bills- electricity, gas, telephone etc.
5) Purchase and Sales of stocks/ share-act as a banker to issue
B. Miscellaneous or General Services:
1) Safe Custody- bailee
2) Lockers-trustee
12

3) Remittance facilities DD, TT etc

4) Advisory services
5) Providing Credit reports
6) Opening L/C
7) Demand in Foreign Exchange/ Travelers Check only Authorized Dealer branches
8) Complete service in Foreign Trade
9) Other Services: Debit Card, Credit Card, On-line banking SMS banking
10) Creation of Credit: a multiplier effect, Deposit creates credit and credit creates
deposits derivative deposit.
Beside these activities, commercial bank may perform further tasks; all its activities are
guided by its authority for the betterment of the company or for society.

CHAPTER THREE
INTRODUCTION OF THE ORGANIZATION
13

3.1 Everest Bank Limited

.

Everest Bank Limited (EBL) was established in1994 (1st Kartik 2051 B.S with a view
and objective of extending professionalized and efficient banking services to various
segments of the society.. The bank is providing customer-friendly services through its
Branch Network. All the branches of the bank are connected through Anywhere Branch
Banking System (ABBS), which enables customers for operational transactions.

The bank is providing its services through a wide network of 44 branches across the
nation. All the major branches of the bank are connected through Anywhere Branch
Banking System (ABBS), a facility which enables a customer to do banking transactions
from any of the branches irrespective of their having accounts in other branch with a 365
days banking.

3.2 Objectives
To become a leading bank by providing premium product and services and then
ensuring attractive and substantial return to the shareholders.

To become the bank of first choice.

To become the preferred provider of quality financial services in the country.
To provide the higher expected rate of return on their investment.
To provide loans with very competitive rate of interest.
To bridge the gap between the savers and borrowers efficiently and effectively.

14

3.3 Corporate vision

Evolve & position the bank as a progressive, cost effective & customer friendly
institution providing comprehensive financial and related services.

Integrating frontiers of technology & servicing various segments of society.

Committed to excellence in serving the public & also excelling in corporate

values.

3.4 Corporate mission

Provide excellent professional services & improve its position as a leader in

the field of financial related services.

Build & maintain a team motivated & committed workforce with high work
ethos.

Use latest technology aided at customer satisfaction & act as an effective

catalyst for socio-economic developments.

3.5 Awards

The bank has been conferred with Bank of the Year 2006, Nepal by the banker,
a publication of financial times, London.

The bank was bestowed with the NICCI Excellence award by Nepal India
chamber of commerce for its spectacular performance under finance sector.

3.6 Unique Selling Proposition

Largest Network (44 branches) among private sector banks spread across Nepal
and all connected with ABBS.

Strong Joint Venture Partner providing Technical Support.

Representative office in India to facilitate remittance from India.

15

Direct Drawing arrangement with PNB and HDFC bank India whereby instant
payment is done on presentation of the instrument.

Direct account credit in PNB branches connected with Central Banking System
More than170 remittance payout location in Nepal

Launching own Remittance Product Everest Remit to enables remit income

from gulf country.

3.6 Board of Directors:

Table 2: Board of Directors
Board of Directors
Mr. B.K. Shrestha

Designation

Board of Director
Chairman
(Chairman)

1
.
2 Mr. Ved K. Shrestha
Director
.
3 Mr. Arun Man Shrestha
Director
.
Executive Director
4 Dr. B.G. Vaidya
Director
.
5 Mr. K Ram Mohan
Director
.
6 Mr. P.K. Mahopatra
Director
.
DGM
DGM
AGM
Company Secretary AGM
7 Mr. Muskan Shrestha
Director
(Marketing) (Credit)
(Planning & Development)
(Operation)
.
8 Mr. Shiva sharan K.C
Director
.

Legal

Retail

Corporate

3.7 Organizational chart

Finance/ Tax/ Inspection,

A/C, NRB/ Budget

MKT

Reconciliation

HRD

Treasury

Security Guard

16
FOREX

Domestic

IT

Fig1: Organizational chart of Everest bank Limited

3.7 Management team

Table 3: Management team
1
2
3
4
5

Board of Directors
Mr. P.K. Mahopatra
Mr. H.P. Kulkarni
Mr. J.K.Arora
Mr. Hum Nath Gurung
Mr. Pramod Raj Sharma

Designation
Chief executive officer
Deputy General Manager
Deputy General Manager
Deputy General Manager
Company Secretary

17

3.11 Progress

Based on the audited results for the financial year ending Asadh 2068 Everest
Banks net profit and operating profit are as under:
Table 4: Net profit and Operating profit
(Rs in crore)

Operating profit
Net profit

Asadh 2067
134.91
83.18

Asadh 2068
151.57
93.13

The Earning per Share (EPS) of the Bank for the year is Rs.83.18.

The Board meeting of the Bank held on 4th Shrawan 2068 (21st August, 2010)
has decided to recommend to the ensuing shareholders Annual General Meeting
of
o Cash Dividend = 50%
o Bonus Shares = 10%
(Subject to approval of the Nepal Rastra Bank)

The total deposit of the Bank reached Rs.4112.79 crore registering a growth of
11.34%. The total credit increased by 12.4% reaching the figure to Rs.3166.18
crore. The total business of the Bank has increased to Rs. 7278 crore.

The NPA is further reduced from 0.44% to 0.34%.

During the last financial year, the Bank opened six branches viz. Taulihawa,
Lumbini, Argakhachi, Krishnanagar, Hetauda and Gorkha. On 5th Bhadra, 2068, a
branch at Bagbazar, Kathmandu came into operation. Thus the total number of the

18

branches of the Bank reached 44. Similarly, the Bank has further plans to expand
its branch network during the current financial year 2068/69.

3.12 Shareholding Structure:

The following pie chart shows the shareholding structure of EBL.

PNB; 20%

Promoters; 50%
General Public; 30%

Fig 2: Share holding Structure of Everest Bank Limited

3.13 Brief Profile of EBL New Road

Everest Bank Limited, Branch Office, New Road started its operations in 1995 with a
view and objective of extending professionalized and efficient banking services to
various segments of the society in the New Road area and thereby contributes in the
economic development of the area as well as country. The bank recognizes the value of
offering a complete range of services not only to corporate but also to individual.
EBLNR has various departments, such as: customer service department, teller
cash department, remittance department, back office, credit department.
19

3.14 Organization structure of EBLNR

Branch Manager
(Senior Manager)

Operation Head
(Deputy Manager)

Credit head
(Assistant
L/C

System

Back Office

Accounts

A/c
opening

Clearing

Credit

Counter

Outward
Remittance

Teller Cash

Fig 3: Organization structure of EBLNR

Despite of the renovation of the banking the bank is smoothly running all of its
departments i.e. account opening, counter, clearing, account, credit and system.

CHAPTER FOUR
ANALYSIS OF ACTIVITIES DONE AND PROBLEM SOLVED

4.1. Deposit
Deposits are foundation upon which banks thrive and grow. They are unique item on a
banks balance sheet that distinguishes it from other types of business firms. The ability
of a banks management and staff to attract checking and savings account from business
20

and consumers is an important measure of the banks acceptance by the public. Deposits
provide most of the raw materials for bank loan and, thus, represent the ultimate source
of bank profits and growth. Deposits generate cash reserves, and it is out of the excess
cash reserves a bank holds that new loans are created. Important indicators of
management effectiveness in any bank are whether or not deposited funds have been
raised at the lowest possible cost and whether enough deposits are available to fund those
loans the bank wishes to make.
The key issues that banks have to deal with to manage deposits are:

Where can the bank raise funds at the lowest possible costs?

How can management ensure that the bank always has an enough deposits to
support the desired volume of loans and other services?

Innovations in the form of new deposit plans, service delivery methods, and pricing
schemes, are rampant in banking today. Bankers who fail to say abreast of changes in
their competitors deposit pricing and marketing programs stand to lose both customers
and profit. As a result of this today we can see lots of deposit schemes launched by every
bank today. Introducing new deposit schemes to attract new customers have become a
trend today.

4.2. Types of Deposit Offered by banks

The number and range of deposits services offered by banks is impressive indeed and
often confusing for bank customers. However the basic types of deposits provided by the
commercial banks are:
Demand or Current Deposits
The organizations needing cash frequently deposit their money in current account, also
known as demand deposit. They are among the most volatile and least predictable of
21

banks sources of fund. The amount deposited in this account can be withdrawn by
drawing cheque without prior information. No interest is offered in this type of account.
The bank can however take incidental or bank charge for the management of the money.
The minimum amount to be deposited and maintained in this account is stimulated. The
amount varies from bank to bank. A passbook containing account and cheque book to
withdraw money are issued to depositors.
Saving Deposit
The low-income people and those not needing to draw money frequently deposit their
money in the saving account. The money deposited in this account can be withdrawn a
limited time within a certain pre-specified period. The amount is also stipulated. The
minimum amount to be deposited and maintained is also pre-specified. The amount varies
from bank to bank. The passbook and cheque books are issued to depositors. Most bank
today issue financial statement on quarterly basis instead of issuing passbook in both,
current and saving account.
The bank provides interest in this type of account. The banks are free to fix the
interest rate themselves. Different forms of saving account are provided by the banks
today.
Fixed or Time Deposit
The amount deposited for a fixed period is called fixed or time deposit. As the main
implies, the amount deposited cannot be withdrawn before the expiry of the fixed period.
However, the depositors can take loan from the bank against the security of fixed deposit
receipt. The interest rates charged on such loans are higher than offered by bank on the
deposits. Since the bank can utilize the money for a fixed period, high interest is offered
in this account.
One type of time deposit in use in present day is the Certificate of Deposit (CD). CDs are
evidences that a person or corporation has deposited a specified sum of money in a bank.
The main difference between CD and time deposit is that the amount to be deposited in
time deposit is not stipulated by the bank. The customer can deposit the amount as he
22

wishes, but cannot withdraw until it matures. On the other hand, it is compulsory to
deposit the amount stipulated by the bank in case of CD.
No cheque book and passbook is issued in this account. Only fixed deposit receipt is
given as an evidence of deposit
Recurring or Cumulative Deposit
The cumulative deposit is like a saving deposit. In this account each month or after a
fixed interval of time, a fixed amount is deposited up to a fixed period. After expiry of the
period the bank pays the lump sum amount. Here the interest is given as in time deposit,
but interest is added in compound interest basis. The bank gives permission if the
customer wants to close the account before maturity, but the interest rate offered may be
lower.
Call Deposit
Call deposit is a hybrid kind of deposit. It incorporates the feature of current and saving
deposit. People can withdraw at any time like in current account and gains interest like in
saving account. Interest is not defined beforehand but instead the interest rate is
negotiable. Depositors can withdraw the amount deposited with minimum balance but
should maintain the previous balance of deposit within certain days.

Margin Deposit
Margin deposit is an interest free deposit. The deposit for letter of credit, bank guarantee,
margin lending, safe deposit locker, etc. is margin deposit.

4.3. Factors affecting the interest rates

People deposit their money in different type of accounts offered by the bank. The interest
rate is different for different kinds of deposit. The rate of interest on deposits depends on
following factors:

23

Maturity of Deposit:
In general, longer the maturity of the deposit the higher the interest rate that the bank
offers. It is because of the time value of money and frequent upward slope of the yield
curve. For example, the fund deposited in current account is subject to immediate
withdrawal by the customer, hence, no interest is offered. Banks offer lower interest rate
in saving deposit which is subject to withdrawal, but not frequently. Banks offer higher
interest rate on time deposits. Even interest on time deposits varies according to the
length of maturity of the deposit. For example, the deposit of more than two years carries
interest rate higher than that of one year deposit.
Size and Perceived Risk Exposure
The size and perceived risk exposure of the bank may play a role in determining interest
rate. For example, banks in New York and London are able to offer lowest interest rate
due to their greater size and strength. On the other hand, interest rate offered by other
banks is generally higher
Marketing Philosophy and Goals
Marketing philosophy and goals of the banks also influence interest rate. For example,
banks that compete for deposits offer higher interest rates to snatch depositors from their
competitors. In contrast, banks that want to discourage deposits offer lower interest rate
than their competing banks or financial institutions. This is what is actually happening in
Nepal at present. Banks, in general, and joint venture banks, in particular, have been
offering all time low interest rate to discourage customers.
Liquidity Position
The liquidity position of banks also influences interest rate. When banks have higher
liquidity and low demand for loans, and low investment opportunities, they offer low
interest rates to discourage deposits vice versa. At present, banks in Nepal have excess
liquidity due to high amount of remittance, reduction of compulsory reserve requirement
by NRB, flow of rural savings to urban areas and low demand for loans due to
unfavorable business environment. These factors have compelled banks to reduce the
deposit rates.

24

4.4 Classifications of various types of deposit

1. Based on Interest
a) Interest bearing

Recurring Deposit

Saving Deposit

Fixed Deposit

Call Deposit

b) Noninterest bearing

Margin Deposit

Current Deposit

2. Based on Transaction
a) Transacting

Demand Deposit

Call Deposit

Saving Deposit

Recurring Deposit

b) Non Transaction

Fixed Deposit

Margin Deposit

4.5. Deposits Schemes Provided by Everest Bank Limited

In order to attract customer the bank adjust the types of deposits according to their
need and demand of the customer including various facilities and attractiveness in the

25

deposit scheme which vary from bank to bank. So the deposit schemes provided by the
Everest Bank Limited are as follows:
4.5.1 Current Account
EBL offers a wide range of products and services designed to make banking easier and to
match each and every customer's requirements. This account is non-interest bearing
account.There is no limit for withdrawal and deposit in this account. There is provision of
internet user login for this account in case of single signatory.
EBL's Current Account offers various benefits and flexibility.

Free Cheque books

Free monthly statement

Unlimited Withdrawal

Extended Banking Hour

365 days banking

All the branches of EBL are connected through ABBS (Anywhere Bank Branch
Service) which enables you to withdraw and deposit cash from any of the
branches.

ATM cum Debit card in association with SCT.

Required documents for deposits:

Minimum Balances for accounts may vary across branches. In terms of EBLNR the
minimum balance is Rs 500.
For personal accounts:

Citizenship Certificate or Passport and 2 PP size photos.

For Sole Proprietorship:

Registration Certificate

Tax Certificate
26

Citizenship Certificated Proprietor

2 PP size photos

For Partnership Account:

Partnership Agreement deed

Firm Registration Certificate

Tax Certificate

Citizenship Certificate of Partners

2 PP size photos of partners

Limited Company Account:

Registration Certificate

Memorandum & Articles of Association

Name, Address of directors & Office Bearers of the Limited Company with copy
Citizenship Certificate

Name & Signatures of the Persons Authorized to Operate an account

Operation Commencement Certificate (for Public Ltd. Co.)

Resolution of Board of Directors regarding opening & conduct of an account

Tax Certificate

4.5.2 Saving Account

EBL saving account is a deposit account held at a bank maintained by a customer for the
purpose of accumulating funds over a period of time while earning an interest. The
purpose for this account is to be kept on deposit for a minimum length of time, while
others permit unlimited access to funds.
Saving account can be opened in NPR and for the Nepalese citizen and USD for
foreign citizens with valid password and job appointment letter.
27

Interest rates
Interest rate is calculated on Daily Closing balance and payable on quarterly basis.
EBL's Saving Account offers various benefits:
Free cheque book
Minimum balance of NPR 500/- to open saving account in any branches
Free statement on demand
Unlimited withdrawl
Evening counter facility
365 days banking
Required documents for deposits:
Minimum Balances for accounts NPR 500/-.
For personal accounts:

Citizenship Certificate or Passport

2 PP size photos

4.5.3 Saving Premium Account

Minimum Balance
The minimum balance required for Saving Premium Fund Accounts shall be Rs. 1 lac.
Interest
Interest is calculated on daily closing balance basis and paid half yearly.
Additional Benefits

Issuance of Everest Bank Saving Premium Card

Exclusive Service for the Saving Fund Premium accounts holder.

No commission on Demand Draft up to Nrs. 1 lac in a month.

No Security deposit for locker facility.

28

Allotment of Safe Deposit Lockers on priority basis (subject to availability). For

small lockers 50% discount and if it is not available 15% discount on other
lockers.

Personal Accidental Death Insurance for Rs. 3 lac

EBL's Saving Premium Accounts offers you various benefits

Free ATM card

Extended banking hours
Unlimited with drawl
ABBA facilities (Anywhere Bank Branch Service)
365 days bank
Free statement on demand

Required documents for deposits:

For personal accounts:

Citizenship Certificate or Passport

2 PP size photos

4.5.4 Fixed Deposit

EBL has introduced several innovative schemes under Fixed Deposit designed to cater to
the needs of various segments of customers to meet specific requirement. One can open
fixed deposit from 15 days to 5 years. The given interest rate remains unchanged during
the period of the deposit. A certificate of Deposit (FDR) is issued only for fixed deposits.
Minimum Balance
NPR: 10,000.00 are required for fixed deposit.
Interest Rate:
Interest is paid on quarterly basis to the nominated account maintained at EBL.
Required documents for deposits:
For personal accounts:

Citizenship Certificate or Passport

29

2 PP size photos

For Sole Proprietorship:

Registration Certificate

Tax Certificate

Citizenship Certificated Proprietor

2 PP size photos

For Partnership Account:

Partnership Agreement deed

Firm Registration Certificate

Tax Certificate

Citizenship Certificate of Partners

2 PP size photos of partners

4.5.5 Sunaulo Bhavishya Yojana

To cater to people who have the habit to save in a regular basis and avail the bulk sum at
the end with a high yielding interest rate the bank launched the recurring deposit. The
deposit is targeted among the middle class families who save for specific purpose like
purchase of items, marriage etc.
This deposit goes on the policy that Every drop counts. One deposits certain amount of
their income in regular interval for certain period. On maturity one gets the principal
amount (i.e. the installment) along with half yearly compounded interest.
Deposit Amount
Minimum amount for opening an account is Rs. 100.00 and amount can be deposited in
multiples of Rs 100. The amount of installment need be fixed at the time of opening the
account.
30

Periods of Deposit
12 months to 36 months in multiples of 12 months.
Maturity Value
Paid in lump sum at the time of maturity.
Premature Withdrawal
Allowed at 1% lower interest rate than the published deposit rate for the deposited period
or prescribed rate (Whichever is lower).
Loan
Loan available upto 90% of the deposited amount at 2% higher rate than the published
deposit rate.

Required documents for deposits:

For personal accounts:

Citizenship Certificate or Passport

2 PP size photo.

4.5.6 Naari Bachat Khata

With the objective to encourage the small saving of women household and professions
we have introduce Naari Bachat Khata. Where the customer can make small saving and
get the higher interest rate.
The facility offer in this account is as under
Attractive interest Rate on Daily Balance Basis
31

Opening of Account at NPR 5,000/- (valley) & NPR 2,500/- (outside valley)
Issuance and renewal of Debit Card at NPR50/Issuance of Free Cheque Book
Pay Bill Registration Facility
25% discount on Annual locker rent (Small Locker Only)
i Banking (Internet Banking) service facility

4.5.7 Saugat Bachat Khata

Saugat Bachat Kahta is a unique product, which has integration of both saving and
fixed deposit feature. The bank introduced Saughat Bachat Khata where the customer
will get interest rate on saving account varies from 3% p.a. to 10.00% p.a. depending on
time period. In this method we have two features in one saving account i.e. saving nature
and fixed account nature.
Product Nature
Minimum Balance

:
:

Composition of Saving & Fixed Deposit

Account is opened at minimum balance of NPR 5000/-.

Features of Product
The bank would provide the facility of automatic transfer of balance from saving account
to FDR. In case the customer withdraws the amount from this account then it will be
treated as under
- First, the balance available upto Rs. 50,000/- in the account would be utilized;
- For further needs, withdrawal will be allowed from Fixed Deposit in the multiples of
Rs. 25,000/- as per the requirement of the customer.
Interest rate offer
3% p.a. interest rate on Saving Account at the time of Opening
From 30 days to 90 days 7.00% p.a. interest rate
From 91 days to 179 days 8.25% p.a. interest rate
From 180 days to 360 days 10.00% interest rate
Other Facilities

Issuance of Debit Card at concession rate of NPR 100/-

Free Issuance of Cheque book

Free Internet banking

32

Mobile recharge and bill payment through SMS

Joint account facility

4.5.8 Cash Certificate Scheme

This product is intended to cater to the demand of those depositors who want higher
return on small investments. This is in fact a discounted value system, the maturity of
which has been fixed as the height of Mount Everest (i.e. 8848 mt. & 29029 feet).
Name of the scheme: HAJURKO KAMAI, EVEREST KO UCHAI
Target Group : Individuals, professionals, housewives who want to invest small deposits
for 2-3 yrs period
Features/modality:A fixed amount shall be deposited for fixed tenure with fixed maturity value. The
maturity value will be Rs.8,848.00 and Rs.29,029.00 matching to the height of Mt.
Everest. The depositor has to deposit discounted amount as indicated in the table to get
the maturity value.
Table 5: Interest rates of Hajurko Kamai Everest ko uchai

Principal Amt.

Period

Int. rate

6,448.00

3 yr

10.6877%

8,848.00

7,148.00

2 yr

10.8115%

8,848.00

21,029.00

3 yr

10.8921%

29,029.00

23,429.00

2 yr

10.8610%

29,029.00

SN
1

4.5.9 Baal Bachat Khata

33

Maturity Value

height in mt.

height in ft.

With the objective to make the childrens future secure EBL have introduce Baal Bachat
Khata where the parents/ guardian make the saving in their children name and the bank
pays higher interest on this account.
Attractive interest Rate on Daily Balance Basis

Opening Account at NPR 5,000/- (valley) & NPR 2,500/- (outside valley)

Issuance and renewal of Debit Card at NPR 50/-

Issuance of Free Cheque Book

Parents will be the guardian of the account till the children will be major.

4.5.10 Supreme Deposit

EBL Supreme Account Scheme has offered its customer for higher interest rate in Fixed
Deposit Account as well as Higher Interest rate on Saving Account. The Customer who
open a fixed Depoit Account under Supreme Account are eligible to open a saving
account up to 5.50% p.a and the interest on saving account is calculate on daily closing
balance.
The interest offered on Supreme Fixed Deposit Account and Supreme Saving Account is
as under:

Table 6: Interest Rate Offered in Supreme Fixed Deposit Account

Interest Rate in %
Amount in Rs.

1 year to below 2 2

years

years

above

8.00%

8.25%

8.25%

8.50%

8.50%

8.75%

Above 25.00 Lacs to 50.00 9.25%

9.50%

Rs. 10.00 Lacs

Above 10.00 Lacs to 25.00
Lacs
Above 25.00 Lacs to 50.00
Lacs

34

&

Lacs
Above 100.00 Lacs

9.50%

10.00%

Table 7: Interest Rate Offered in Supreme Saving Account

S.N
1.
2.

Amount In Supreme Interest Offer in Supreme Saving

FD
FD Up to Rs. 50.00
Lacs

Account
5.00% p.a.

FD Above Rs. 50.00

5.50% p.a.
Lacs
Cheque book and Debit Card is provided against Supreme Saving Account.

4.5.11 EBL NRN Deposit

EBL welcomes you to open Foreign Currency Deposits. As per the NRNs ordinance
2062 such deposits along with interest are fully repatriable.
Salient Features of EBL NRN Deposit Scheme
Avail attractive interest rate on Foreign Currency along with additional 0.5% on NPR
deposits.
Who can open

Non Resident Nepalese (NRN) as defined in NRN ordinance

2062, Article No. 2

Where

All branches

How

By credit received in convertible foreign currency in our nostro

accounts as given overleaf

Currency

USD, GBP and Euro

Offered
Minimum

10,000 units in Foreign Currency

Amount
Type of

Saving and Term Deposit

35

Deposits

4.5.12 USD Account

Those individuals and companies who earn/ get funded in dollars can open USD Account
at EBL branches.
Required documents for deposits:
For personal accounts:

Citizenship Certificate or Passport

2 PP size photos

For Sole Proprietorship:

Registration Certificate

Tax Certificate

Citizenship Certificated Proprietor

2 PP size photos

For Partnership Account:

Partnership Agreement deed

Firm Registration Certificate

Tax Certificate

Citizenship Certificate of Partners

2 PP size photos of partners

36

4.5.13 Unfixed Fixed Deposit Scheme

Unfixed Fixed Deposit Scheme allows benefits of higher term deposit rate with quarterly
compounding interest while allowing facility of simultaneous overdraft against deposit.
Now you can use your money while earning interest on it.
Deposit Amount
Minimum Rs. 50,000/Period of Deposit
6 months upto 5 years
Maturity Value
Principal Amount of deposit with upto date interest shall be paid on maturity date.
Required documents for deposits:
For personal accounts

Citizenship Certificate or Passport

2 PP size photos

For Sole Proprietorship

Registration Certificate

Tax Certificate

Citizenship Certificated Proprietor

2 PP size photos

For Partnership Account

Partnership Agreement deed

37

Firm Registration Certificate

Tax Certificate

Citizenship Certificate of Partners

2 PP size photos of partners

4.5.14 Cumulative Deposit Scheme

In case you require bulk amount in future to meet your financial needs like children's
higher education, their marriage etc. open an account under Cumulative Deposit Scheme
and earn higher term deposit interest on quarterly compounding basis. Main features of
the scheme are as under:Deposit Amount
Minimum Rs. 5000/Period of Deposit
6 months upto 5 years
Maturity Value
Principal amount of deposit with upto date interest shall be paid on maturity date.
Overdue Deposit
The bank may at its discretion, allow interest on overdue deposit from the date of
maturity provided the deposit is renewed from the date of its maturity for at least 15 days
from the date of presentation.
Loan/overdraft
Allowed at 2% over deposit rate.
For further details contact the branch
The account opening form can be collected from the branch or downloaded by clicking
here. The duly filled account opening form along with the relevant document can be
submitted at the branch near you.
38

Required documents for deposits:

For personal accounts:

Citizenship Certificate or Passport

2 PP size photos

4.6 Strategy for Deposit Schemes:

Everest Bank limited is currently running in 17th year of its operation and with the
effective and efficient banking service such as different deposit schemes and retail
lending schemes it has attracted and maintained a lot of customers. As per the bank, the
bank has sufficient number of customers having current, saving and fixed deposit
schemes. But the bank is planning to increase the number of saving deposit customer as it
has to pay less interest than that of the fixed deposit and can utilize the funds more
efficient in profitable sector than that of current deposit. For this purpose the bank
influence its customer to open a saving account and any new customer who enter the
bank for inquire the bank staff influences the customer by showing different attractive
feature of saving deposit.
As the competition is growing between the banks, it is difficult to for the bank to
maintain and attract new customer. So the bank introduces different and new deposit
schemes. Therefore the bank doesnt advertise the product in mass but advertises the
product inside the bank premises in an attractive manner so that it retains its customer
and also welcomes new customer.
4.7 Procedure of Opening the Deposit Scheme

The first step is to ask the customer to fill up the Account Opening Form and the
Signature Specimen Card.

The second step is to ask the customer for the required document and verify the
document.

The third step is to provide the customer with his/ her account number which is in
the multiple of 10 and is obtained serially from the account opening register.
39

The forth step is to enter all the information about the customer in the finacle
Software which is done in following manner.

First step is to define the account type, branch name and the account code of the
customer.

Then a window appears where customer personal details such as name, address,
phone etc are entered.

In the same window by clicking the main code option the customer type details
such as Nepalese residence or citizen or individual, types of business etc are
entered and the account is created for E-banking purpose.

4.8 Factors Affecting Customers Choice for Bank Deposit

4.8.1. Current Account

Location

Availability of many other services

Safety

Low fee and low minimum balance

ATM/ Credit Card facility

Cheque book availability

Any Branch Banking Service (ABBS)

Computerized

Remittance Facility

4.8.2. Saving Account

Credibility / Familiarity

Higher interest rate

Transactional Convenience

Location and any branch banking service (ABBS)

Availability of payroll deduction

Fee charges

ATM / Debit / Credit Cards

40

Minimum balance
Computerized

Cheque book availability

No withdrawal limit

4.9 Activities done

The activities that I did in terms of different deposit schemes are as follows:

Opened different accounts on different schemes

As the customers were unknown about different schemes I gave them the
necessary information

Some of the customers were not able to understand, so I helped them to fill up the
forms

Some of the customers were not able to know which one is favorable for them so I
informed them which made them easier to recognize

CHAPTER FIVE
41

CONCLUSION AND LESSON LEARNT

5.1. Conclusion
From the above analysis it is seemed that EBL is one of most hard working commercial
bank that is dedicated in serving their valued customers with excellence. EBL is one
name that can really be trusted upon. In spite of the political insurgency going on in the
country the Bank is able to result profit of Rs. 127,588,340.85 with deposit amounting
Rs. (3,590,919,368.69) and loan amounting Rs. 3,671,209,087.42.
The prospect of Deposit Scheme in EBL is bright; the phenomenal growth rate of
Deposits suggests that EBL is doing fine in business. The scheme of the deposit is as per
the customer needs leading it towards the success. The success of this deposit scheme is
also the results of its sound and systematic deposit procedure.
This bank is pioneer in deposit scheme and has to give substantial attention in its deposit
scheme and changes around the environment in order to sustain them.
The bank are the institutions providing wide range of services for accepting and lending
money .They play vital role in channelizing the surplus amount from the depositor to the
deficit one. They are the major regulator of the economy of the country like Nepal which
is always helping people in upgrading their economic condition as well the economic
condition of the whole country. It provides the opportunities for the people as well as the
government to utilize the available funds that remain idle on them.
The Nepalese economy is filled with much of uncertainty and insecurity as due to the
political instability and the competition between the commercial banks that puts a big
question mark on the profitability of any business and banking organization. However in
such situation, EBL can be said to be playing a biggest role for the development of
economic sector through its services.
EBL is playing a pivotal role in facilitating services to and from across globe. Being the
first Nepalese bank to open a representative office in Delhi, India, the Nepalese in India

42

can open account in Nepal from designated branches of Punjab National Bank and remit
their saving economically through banking channels to Nepal.
The whole internship period in EBL was a great experience where the time was spent
serving the customer in CSD, clearing, Remittance Department and Credit Department
where intern came up with new ideas and developed with skills to deal with the
customers, so far to cope with the real banking world situation. Working at EBL as an
intern was a great opportunity to develop conceptual and analytical knowledge about
banking sector in Nepal.
Therefore, I conclude that the financial performance of EBL seems pretty sound and
successful in the present context.

5.2 Lessons Learnt

Knowledge is nothing if cant be applied in practice. The 8 weeks internship periods have
become a great experience and a fruitful one where intern obtained insights into career
opportunities through interaction, observation and work experience in the organization. It
becomes a platform to be competent, confident and a skilled professional in the near
future.
The most important lesson that I have learnt during my intern period is the corporate
working environment, which is the basic lesson for my career development. Beside this, I
have also learnt the working of the general banking transaction process by being engaged
as intern in EBLNR. During my intern period what I felt is the importance of the time
management and the need of the communication skills. Since the customers are the main
drivers of any financial institutions, they should be pleased by offering the quality
services which are basically depends on the quick service and the pleasing personality of
the staffs because most of the services provided by different commercial banks are same
in nature and customers have different choices to make in the market.

43

During my intern period, I observed that customers draw the image of the organization
from the behavior of the personnel, who have been attached to the organization in any
firm. So the misbehavior of any personnel adversely affects the organizational image.
In an organization, personnels despite being under work pressure, lots of responsibility
and under rules and regulation, there develops certain socialize environment which attach
one another beyond the hierarchy level creating the environment more friendly and
affectionate. The degree of socialize environment of any organization determines the
effectiveness and efficiency of any organization. So is the case of EBL. The friendly
environment, marvelous organizational culture and the efficient management are the
reason behind the success of this branch despite of the heavy workload.
Working as an intern in different department at EBL at New Road branch helped to learn
many things as:

To implement the things that has been studied throughout the whole life into

practical use.
To socialize with the people, staffs and the intern colleagues.
To handle customer grievances and solve it out effectively.
The specific abilities like interpersonal skills, team work, to be patience etc

were enhanced during the internship period.

Learned the process of account opening in the bank under different account

schemes.
New about the deposit schemes of Everest Bank Limited.
To maintain and handle the files, documents which might be helpful in the

near future.
Using different office equipments like fax, photocopy, cheque writer, printers

and scanning, etc

Learnt to prepare Bi. Bi. ni. form no 4 in credit department in LC section.

44