Haseeb Jamal

INTERNSHIP REPORT ON
NATIONAL BANK OF PAKISTAN
ABBOTTABAD MAIN BRANCH
(0301)
Abbottabad University of Sciences & Technology
Abbottabad
SESSION 2014- 2016

INTERNSHIP REPORT ON
NATIONAL BANK OF PAKISTAN
ABBOTTABAD MAIN BRANCH
(0301)
This Internship report is submitted to partial fulfillment of the

requirements for the degree of Bachelor of Business Studies
awarded by the Abbottabad University Science & Technology,
Abbottabad.
Abbottabad
SESSION 2015- 2016

Abbottabad
APPROVAL SHEET
Approval Committee
1. Supervisor
Miss. Rabia Noreen
Signature
Designation
2. External Examiner
Mr.
Signature
Designation
3. Coordinator Research & Development Division
Mr./Miss
Signature
DEDICATION
I would like to thank my lovely parents
and teachers for giving me this
opportunity to get this degree and
supporting me in all my student life. Their
support enables me to accomplish my
BBS degree. I dedicate this report to my
ever-loving parents and my teachers,
specifically to my loving father.

PREFACE
Banks play very important and vital role for the economic growth and
sustainability of economy. The bank deals in money, such institution are also
required to fulfill other financial needs such as provision of place to deposit
money, serving for the utilities and advancing money in order to facilitate the
needs of householders and the businesses. In this report the financial position
of NBP has been studied and analyzed.
The methodology for data collection that was available resources by the
organization, like website, annual reports, books, articles publicly available
data, etc. also, interviews with some employees and observation methods were
used. In the first chapter introduction to the report, background of study, scope
of the study, merits, limitation, and scheme of the study are given. The report
covers the history of NBP bank, introduction of NBP, its background, role and
functions, its core values, and miscellaneous topics related to Finance
department of NBP Bank
Ultimately whole argument comes down to this: the bank is functioning in a

proper & systematic manner, but need more competitive strategies, long term
debts, & outside creditors, creditors should provide the funds to meet the SBP
policies to have the maximum branches.
In this report, I also included the financial analysis that helps to know that
where the NBP is strong and where it needs improvements. NBP offers new
products and services day by day for improving its performance, but there are
many hurdles in the way of success of NBP, all the recommendations are given
in the report and there solutions as well as that can be helpful in the success of
NBP in future.
ACKNOWLEDGEMENTS
Allah Almighty is worthy of all acknowledgments, whose grace has no limits

and who gave me the strength and will to complete this report.
I have no words to express my heartiest sense of gratitude to my supervisor,

Madam Rabia Noreen for his supervision, contribution, intellectual
guidance, constructive suggestion, valuable time, patience, and wise
comments to make this report possible.
I highly appreciate the help and cooperation of the Branch manager of NBP
Abbottabad branch for his support and collaboration.
The finally yet importantly, I would feel incomplete without thanking to my

parents who always pray for my brilliant success and bright future.
Muhammad Haseeb Jamal

TABLE OF CONTENTS
Chapter 1 ....................................................................................................................... 1
Introduction of Study ..................................................................................................... 1
1.1 Background of Study .............................................................................................. 1
1.2 Purpose of Study ..................................................................................................... 1
1.3 Scope of Study ........................................................................................................ 2
1.4 Limitations of the work........................................................................................... 2
1.5 Benefits of the Study............................................................................................... 2
1.6 Research methodology ........................................................................................... 3
1.6.1 The major sources for Primary data includes............................................... 3
1.6.2 The major sources for Secondary data includes........................................... 3
Chapter 2 ....................................................................................................................... 4
Introduction to organization (NBP) ............................................................................... 4
2.1 They aim to be an organization that is founded on ................................................. 4
2.1.1 They aim to be People who…...................................................................... 4
2.1.2 They have confidence that tomorrow they will be… ................................... 4
2.1.3 Evaluation of Banking / Industry in Pakistan .............................................. 5
2.2 Historical Introduction to the organization (National Bank of Pakistan).............. 6

2.2.1 History of NBP .......................................................................................... 6
2.2.2 Credit Rating ................................................................................................ 8
2.2.3 Audit committee........................................................................................... 8
2.2.4 Present status ............................................................................................... 9
2.3 Organizational structure of NBP ........................................................................... 10

2.3.1 Operational Group ................................................................................ 11
2.3.2 Audit and Inspection Group ...................................................................... 11
2.4 Senior Management ........................................................................................... 12

2.4.1 Senior Management For Overseas Operation ......................................... 13
2.5 Vision and Mission Statements ............................................................................. 14

2.5.1 Mission ...................................................................................................... 14
2.6 Objectives of National Bank of Pakistan .............................................................. 14
2.7 Core Values ........................................................................................................... 14
2.7.1 Shall work to .............................................................................................. 15
2.7.2 We aim to be people who… ....................................................................... 15
2.7.3 We have confidence that tomorrow we will be… ...................................... 15
2.8 Corporate Profile................................................................................................... 16

2.8.1 Board Of Directors..................................................................................... 16
2.9 Organization Structure of Bank Branch ................................................................ 17

2.9.1 Internal Structure of Bank Branch ............................................................. 18
2.9.2 LOCATION......................................................................................... 19
2.9.3 OVERVIEW........................................................................................ 19
2.9.4 Number of Employees ........................................................................ 19
Chapter 3 ..................................................................................................................... 20
Product and services .................................................................................................... 20
3.1 Deposit Department .............................................................................................. 20
3.1.1 Account opening ........................................................................................ 20
3.1.2 Procedure of Account Opening ........................................................... 20
3.1.3 Documents Required ........................................................................... 21
3.1.4 Issuance of Cheque Book.................................................................... 21
3.1.5 Cheque Cancellation ........................................................................... 21
3.2 Types of Accounts ................................................................................................. 22

3.2.1 Current Account ......................................................................................... 22
3.2.2 Profit & Loss Sharing Saving Account ..................................................... 22
3.2.3 Profit & Loss Sharing Term Account........................................................ 22
3.2.4 Rates on term Deposit .............................................................................. 23
3.2.5 Foreign currency account........................................................................... 23

3.2.6 National income daily accounts (NIDA) ................................................... 23
3.2.7 Rates or profit on NIDA ............................................................................ 24
3.2.8 Premium saver account .............................................................................. 24
3.2.9 Premium Amdani account ........................................................................ 24
3.2.10 Rates ........................................................................................................ 25
3.2.11 Account of blind person ........................................................................... 25
3.2.12 Dormant & inoperative account ............................................................... 25
3.3 Problems in personal account ............................................................................... 26

3.4 Advances department ............................................................................................ 27
3.5 Types of financing................................................................................................. 27
3.6Western union ........................................................................................................ 30
3.7Clearing department ............................................................................................... 30
3.8 Short credit (sc) ..................................................................................................... 31
3.8Foreign exchange department ................................................................................ 31
3.8.1Outward TT in foreign currency ................................................................. 32
3.8.2Inward TT in FC ......................................................................................... 32
3.8.3Short Credit in F.C ...................................................................................... 32
3.9Revaluation of accounts ......................................................................................... 33

3.9.1Revaluation of in-hand-cash account .......................................................... 33
3.9.2 Cash department ....................................................................................... 33
3.9.3 Cash Receipts........................................................................................... 33
3.9.4 Cash Payments .......................................................................................... 33
3.9.5 Cheque and their Payment ........................................................................ 34
3.9.6The Requisites of Cheque ........................................................................... 34
3.9.7 Parties to Cheque ....................................................................................... 34
3.10 Types of Cheque ................................................................................................. 35

3.11Remittance department ........................................................................................ 36
3.12 Demand draft (Dd) .............................................................................................. 36
3.13 Mail transfer (Mt) ............................................................................................... 37
3.15 computer department .......................................................................................... 39
3.16 Establishment department ................................................................................... 40
3.17 Sarhad rural support Programme section (SRSP) ............................................... 40
Chapter 4 ..................................................................................................................... 41
Financial analysis ......................................................................................................... 41
4.1 Financial Analysis ................................................................................................. 41
4.1.1 Common size analysis ............................................................................... 43
4.1.1.1 Vertical Analysis of NBP Balance sheet ................................................. 43
4.1.1.3 Horizontal Analysis of NBP`s Balance interpretation ............................ 45
4.1.1.4 Horizontal Analysis of NBP`s income statement an ............................... 47
4.2 Ratio Analysis ....................................................................................................... 47

4.2.1 Liquidity Ratios ......................................................................................... 48
4.3 SWOT ANALYSIS ............................................................................................... 58

4.3.1STRENGTHS OF NBP .............................................................................. 58
4.3.2 Weaknesses of NBP ................................................................................. 59
4.3.3 Opportunities of NBP ............................................................................... 60
4.3.4 Threats ..................................................................................................... 60
Chapter 5 ..................................................................................................................... 62
Conclusion and recommendations ............................................................................... 62
5.1Conclusion ............................................................................................................. 62
5.2 Recommendations ................................................................................................. 62
5.5.1 Professional Training: ................................................................................ 63
References.................................................................................................................... 70
LIST OF TABLES
Table 2.1 13
Table 2.2 16
Table 4.1 40
Table 4.2 41
Table 4.3 43
Table 4.4 44
Table 4.5 46
Table 4.6 47
Table 4.7 48
Table 4.8 49
Table 4.9 50
Table 4.10 51
Table 4.11 52
Table 4.12 54
Table 4.13 55
Table 4.14 55
Table 4.15 56
LIST OF TABLES
Chart 4.3 43
Chart 4.4 44
Chart 4.5 46
Chart 4.6 47
Chart 4.7 48
Chart 4.8 49
Chart 4.9 50
Chart 4.10 51
Chart 4.11 52
Chart 4.12 54
Chart 4.13 55
Chart 4.14 55
Chart 4.15 57
LIST OF ACRONYMS
NBP National Bank of Pakistan
BOD Board of Directors
D.D Demand Draft
EBIT Earning Before Income Tax
EPS Earning per share
EVP Executive vice president
I.T Information technology
L/C letter of credit
M/T Mail Transfer
MIS Management Information system
PLS Profit and loss saving
SBP State bank of Pakistan
SEVP Senior executive vice president
SVP Senior vice president
SWOT Strength Weaknesses Opportunities Threat
SS Specimen signature
VP Vice president
EXECUTIVE SUMMARY
This internship report is related to national bank of Pakistan, being a

government bank it is operating in almost every part of the country that is why
it is the largest bank of Pakistan. Furthermore, NBP has its network outside
national boundaries of Pakistan. The intense competition, among banks, the
privatization of the financial institution and financial liberalization in general
are gradually and continuously making the banking sector effective and
efficient.
National bank of Pakistan is one of the leading and establishes banks of the
country. It has a large setup of departments and a big organizational structure.
While working in a Abbottabad branch of the bank, it is not possible to
thoroughly cover all the areas of the bank, as it requires more time and two
months are in no way sufficient to do so. Different tools and techniques were
used to gather relevant information for writing the report. Secondly, journals
from regional head quarter and staff college was also reviewed which gave
very useful information about the functioning of the bank. I also visited the
national bank of Pakistan’s official web site, which gave very useful
information about the services provided by the bank.
NBP established in 1949, National bank of Pakistan has grown to become the
largest commercial bank in the country, maintaining its position as Pakistan’s
premier bank determined to set higher standards of achievements. The bank
came in to existence by the order promulgated by governor general and started
functioning from Nov 20, 1949. NBP is the major business partner for the
government of Pakistan with special emphasis on developing Pakistan’s
economic growth through aggressive and balanced lending policies,
technologically oriented products and services offered through its large
network of more than 1400 branches locally, 24 branches internationally and
11 regional offices.
The basic purpose of this report is to describe and define different functions
and products of the bank, to identify weak areas of the bank, to analyze the
performance of the management and to make a financial analysis of it and
suggest recommendations. It is also our degree requirement to do an internship
in any company so the basic purpose of this report is to fulfill the bachelor
degree requirement
This internship report is divided into five chapters, which are:
Chapter 1 includes background, purpose of study, Scope of study, some

limitations, merits, and scheme of this Report.
Chapter 2 includes background and history of banking in Pakistan as well as

Introduction to NBP, Abbottabad branch.
Chapter 3 includes the financial statement, Products, and services offered by

NBP to its valued customers.
Chapter 4 includes the SWOT and ratio analysis and their interpretation.
Chapter 5 includes some of the conclusion and some of the recommendations.

CHAPTER 1
INTRODUCTION OF STUDY
Starting with the name of Allah, I am going to write my internship report as

part of the academic requirement for the completion of four year’s study in
Bachelor of Business Studies. Therefore, we the students of Management
Sciences are required to undergo an internship program for the period of 6
weeks as an internee in an organization. This internship helps me to gain the
practical knowledge of working environment of the banking sector of
Pakistan.
1.1 BACKGROUND OF STUDY
NBP established in 1949, National bank of Pakistan has grown to become the
largest commercial bank in the country, maintaining its position as Pakistan’s
premier bank determined to set higher standards of achievements. The bank
came in to existence by the order promulgated by governor general and started
functioning from Nov 20, 1949. NBP is the major business partner for the
government of Pakistan with special emphasis on developing Pakistan’s
economic growth through aggressive and balanced lending policies,
technologically oriented products and services offered through its large
network of more than 1403 branches locally, 24 branches internationally and
11 regional offices (Annual report NBP, 2016).
1.2 PURPOSE OF STUDY
The purpose of this study is to get more knowledge about the structure and
functioning of National bank of Pakistan and to check its financial health. For
this purpose I have done financial analysis, common size analysis and ratio
analysis of the bank, this is carried out to judge the actual financial position of
the bank and give recommendations on financial aspects to further improve
the functioning of the bank.
1
1.3 SCOPE OF STUDY
The time duration of two months is insufficient for conducting complete study
and observation of a large bank. Being a student specializing in finance, the
focus of this study is on its financial aspects including the financial health of
the bank and its comparison with previous year’s performance. Some of the
problems faced by the bank have been identified and some recommendations
have been suggested to overcome these problems and to improve the
prevailing financial condition of the bank.
1.4 LIMITATIONS OF THE WORK
There are some limitations which internee had to face during the internship
program, which are described as under:
 The period of two months was too short to properly understand and analyze
all the operations of bank.
 Staff members avoided to give all information due to the matter of secrecy.
So it was very difficult to collect the relevant information and to learn
accordingly.
 Manager and other staff members have busy schedule due to this reason it
was a great problem for them to spend time with internee, so it is not easy to
learn or to gain knowledge from them.
 Some of the data was confidential and that was not made available to me.
1.5 BENEFITS OF THE STUDY
An internship grooms a person personally, academically and professionally. At

the end of internship, one gets a certificate, which acknowledges his work for
that specific company. This adds to his experience, an internship is a great
opportunity to improve interpersonal skills. Practical also provides the
opportunity to gain self-confidence. Moreover, it Figure out what one’s
2
strengths are and also a good time to identify one’s weakness so that he can
improve them.
1.6 RESEARCH METHODOLOGY
National bank of Pakistan is one of the leading and establishes banks of the
country. It has a large setup of departments and a big organizational structure.
While working in a Abbottabad branch of the bank, it is not possible to
thoroughly cover all the areas of the bank, as it requires more time and two
months are in no way sufficient to do so. Different tools and techniques were
used to gather relevant information for writing the report. Secondly, journals
from regional head quarter and staff college was also reviewed which gave
very useful information about the functioning of the bank. I also visited the
national bank of Pakistan’s official web site, which gave very useful
information about the services provided by the bank.
1.6.1 The major sources for Primary data includes
 Personal observation
 Interviews of management
 Customer response
 Discussion with staff members
1.6.2 The major sources for Secondary data includes
 Annual report of Bank
 Books
 Internet
 Magazines and journals
3
CHAPTER 2
INTRODUCTION TO ORGANIZATION (NBP)
NBP contains its position as Pakistan's premier bank determined to set higher
standards of achievements. It is the major business partner for the Government
of Pakistan with special emphasis on fostering Pakistan's economic growth
through aggressive and balanced lending policies, technologically oriented
products and services offered through its large network of branches locally,
internationally and representative offices.
2.1 THEY AIM TO BE AN ORGANIZATION THAT

IS FOUNDED ON
 Growth through creation of sustainable relationships with our customers.

 Prudence to guide our business conduct.
 A national presence with a history of contribution to our communities.
They shall work to…
 Meet expectations through Market-based solutions and products.

 Reward entrepreneurial efforts.
 Create value for all stakeholders.
2.1.1 They aim to be People who…
 Care about relationships.

 Lead through the strength of our commitment and willingness to excel.
 Practice integrity, honesty and hard work. We believe that these are
measures of true success.
2.1.2 They have confidence that tomorrow they will be…
 Leaders in industry.
 An organization will take the trust of S&h.
4
2.1.3 Evaluation of Banking / Industry in Pakistan
At the time of independence in 1947, Pakistan’s commercial banking facilities

were almost jammed according to a plan in the whole sub-continent especially
in the Muslim majority areas. Pakistan’s banking and Industrial sectors were in
very poor conditions. Banks largely depend for their growth and development
on industrial sector but at the time of independence, Pakistan had patriotically
on industry except a few textile mills and only product food grains and
agricultural raw materials, most of the industries were situate in Hindu
majority area now called India.
A number of banks closed their branches with the result that only 81
branches remained open on 30th June 1948 out of 487. The head offices were
in India and most of their employees were Hindu, and they fled to India.
Imperial Bank of India, Which was conducting government receipts and
payments, closed down most of its branches thus blocking the funds needed by
the government?
The country was in trouble and needed most of the general commercial
banking and credit facilities. This need was a little bit satisfied with the
transferring of the head offer of the HBL. To Karachi on 7th, August 1947.
This bank playing a great role in the next year in the economic development of
Pakistan as the Habib Bank was also new in the new country it was asked to
open more branches at new place this was a difficult time foe H.B.L to open
their branches in different places.
In view of the above mentioned circumstances and in order to

rehabilitee the banking in Pakistan without further delay, on the
recommendations of an committee it was decided to establish as early as
possible a central bank to control the banning and currency in Pakistan.
Accordingly state bank of Pakistan was Pakistan was inaugurated by Quaid-e-
Azam Muhammad Ali Jinnah on 1st July 1948. This bank lost on time in
meeting the national requirements of banking, currency and took following
remedial measures. Requested Government of state a new bank of nationwide
services accordingly National Bank of Pakistan was formed in 1949 which
5
opened many branches and in 1952 took over the emperor Bank of India. It
will draw Indian Currency notes of Rs: 125 crore from General Circulation
and send these for recovery to reserve Bank of India.
2.2 HISTORICAL INTRODUCTION TO THE

ORGANIZATION (NATIONAL BANK OF
PAKISTAN)
National Bank of Pakistan maintains its position as Pakistan's premier bank,

determined to set higher standards of achievements. It is the major business
partner for the Government of Pakistan with special emphasis on fostering
Pakistan's economic growth through aggressive and balanced lending policies,
technologically oriented products and services offered through its nationwide
branches.
2.2.1 History of NBP
National bank was establish in November 09, 1949 under NBP ,ordinance
1949, in order to handle the crises condition which was develop after
Deadlock with India and the devaluation of Indian Rupee in 1949. The bank
proved all type of banking services to the government in general public. It
works as agent of sent real bank because the SBP does not has its own
branches.
The bank schedule commercial bank and its principally engaged in the
business of banking as defined in the banking company's ordinance 1962.
National Bank of Pakistan was basically established for reducing the
difficulties of east Pakistan farmers engaged in jute and patens” after mass
migration of community from east and west Pakistan in India. The bank
commenced its operation in November 20.1949 at six centers of jute in the
then East Pakistan. Lahore and Karachi officers were opened subsequently in
December 1949. Before restructuring in 2002, national Bank of Pakistan with
its head office at Karachi operates through 9 regional headquarters at Lahore,
6
Karachi Hyderabad, Quetta, Peshawar, Multan, Muzaferabad, Faisalabad and
Islamabad.
The bank was incorporated with authorized capital of 60 millions .in 960 this
amount was redacted to the 30 million banks issued 15 million of which 25%
was subscribed by the government and the balance was offered to the general
public .shears to the public where issued in 1950 and where quickly taken up.
In 190 banks ordinance was amended so that it take ordinarily commercial
banking business. On janvery-01-1974 national bank along with thirteen
others commotional banks were nationalized under the promulgation of
“nationalization” act 1974 and the shears not held by the government where
required after compensation them.
The period 1990’s witnessed financial referees and the national bank also in
cooperated the change in its working and offered new services and products to
its clients .at present the bank is playing very important role in financing the
trade .commerce ,agricultural and important concerns and contributing the best
to word making the country prosperous. The improve its costumer focus
redacted decision making layers restructured its entire command and control
system in business and operational spheres zones and audit offices in the year
2002 and eliminated the total numbers of regions in hands from 9 to 29 across
the country .anew matrix structure has been introduced with the objective to
separate the office and the bank offices .to improve the good governance and
enhance the internal control.
 Operation group
 corporate and investment banking group
 special assets management group
 commercial and retail banking group
 audit and inspection group
 overseas Coordination and Management Group
 Risk Management Group
National Bank of Pakistan is known as the premier commercial institution of
Pakistan provide the large diversified customer base of 9.009 million, which is
7
the biggest figure, in the country and conduct the business function of state
bank of Pakistan in addition to provision of other financial and allied services
such as deposit banking financing and credit remittance facilities collection
government receipts and payments. sale and purchase of government
securities, Bands and other certificates, Foreign exchange business, Safe
custody, Safe deposited services and safe deposit, Lockers, Hajji facilities
Utility bills, Investment advice and other services, Special deposits products /
Schemes, pak rupee travelers choose, New product.
2.2.2 Credit Rating
NBP enjoys the highest rating of ‘AAA’ in the industry assigned by M/s JCR-
VIS Credit Rating Company. The ratings assigned to NBP are primarily driven
by the bank’s role in the national economy as an agent of the State Bank of
Pakistan and as a bank to the Government of Pakistan. Additionally, ratings
also derive strength from the bank’s consistently high capitalization levels, and
nationwide access that has enabled it to secure a cost effective and diversified
deposit base.
2.2.3 Audit committee
Chairman
Muneer Kamal
Syed Ahmed Iqbal Ashraf
Tariq Kirmani
Auditors
Ernst & Young Ford Rhodes Sidat Hyder
Chartered Accountants
KPMG Taseer Hadi & Co.
Chartered Accountants
8
Legal Advisors
Mandviwala & Zafar
(Advocates & Legal Consultants)
2.2.4 Present status
National Bank of Pakistan has a network of 1,272 domestic branch and

15,204 employees for subsidiaries, 18. Oversea branches, 4 reparative offices,
1 joint venture and subsidiary (overseas) all the world the local branches are
controlled through 29 regional offices and overseas are managed through 4
overseas regional offices. It is the largest contributory agent of government
requirement. NBP provide wide range of services and including collection of
taxes and deliveries of salaries, person to public sector employees. It has
lowest rate on exports and other borrowings.
National bank of Pakistan, overseas operation comprises 18 overseas

branches, 5 representative offices, one international subsidiary bank of NBP in
Amatory and one joint venture with the United Kingdom. NBP with its
commitment to invest in development of the bank’s I.T infrastructure have
now developed on line branches with modern by highly professional bankers.
NBP has launched an ambitious business reprocessing programmed to make
the bank more attractive with the eventual aim of privatization. The largest
bank in the country with a customer base 9.00 billion in poised for take-off.
9
2.3 ORGANIZATIONAL STRUCTURE OF NBP
President and chairman
President Secretariat
Board of Director
Corporate and investment banking Group
Commercial and retail Banking Group
Operations Group
Audit & inspection group
Compliance group
Financial control division
Employees benefit, Disbursements and trustee
Special assist Management group
Organization development and training group
Overseas coordination and management group
Information technology group
Risk management group
Human resources
Treasurymanagement
managementand Admin Group
group
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2.3.1 Operational Group
Operation Group
Customer Logistic
services and support and
govt business security
Treasury Inter Branch Construction

settlement Reconciliation and
(IBR) Maintenance
Source: Annual Report 2015
2.3.2 Audit and Inspection Group
Audit & Inspection

Group
Admin Internal
(A&IG) Audit &
Inspection
System & EDPA&A

Secretarial
Support
Monitoring Area Audit

& Offices
Evaluation
Source: Annual Report 2015
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2.4 SENIOR MANAGEMENT
Muhammad Saeed Ahmad President
Masood Karim Shaikh SEVP & Group Chief, Commercial & Retail
Banking Group
Wajahat A. Baqai SEVP & Group Chief, Credit Management

Group.
Nausherwan Adil SEVP & Group Chief, Operations Group.
Dr. Mirza Ibrar Baig EVP & Group Chief, Training & Organization
Development Group
Nausherwan Adil SEVP & Group Chief, Operations Group
Zia Ullah Khan SEVP & Group Chief Assets Recovery

Group and Divisional Head, Islamic Banking
Division.
Kausar Iqbal Malik SEVP & Group Chief, Compliance Group
Rehmat Ali Hasnie EVP & Head(acting) , Corporate & Investment

Banking Group & PSO to President
Risha Ameen Mohyeddin SEVP & Group Chief, Treasury Management

Group
Khalid Bin Shaheen SEVP & Group Chief, Global Home

Management Group Remittance
Abdul Wahid Sethi SEVP & Group Chief, Audit & Inspection
Group.
12
Sultana Naheed SEVP & Group Chief, Risk Management
Group
Shahid Saeed EVP & CIO, IT Division
Nausherwan Adil SVP & Divisional Head, Corporate

Communication Division
S.M. Ali Zamin SVP, Secretary Board of Directors & Secretary

Credit Committees
Kashif Aziz SVP, Head PMO
Muhammad Naeem Ansari VP / Secretary Operations Committee
Table-2.1
2.4.1 Senior Management For Overseas Operation
Zubair Ahmed
SEVP & Regional Chief Executive, Middle East, Africa & South Asia
Region
M. Rafiq Bengali
SEVP & Regional Chief Executive, Americas Region

Khawar Saeed
EVP & Regional Chief Executive, Cationentral Asian Republics

Region
Muhammad Hanif Khan
13
SVP & Coordinator, Afghan Operations
2.5 VISION AND MISSION STATEMENTS
 To be recognized as a leader and a brand synonymous with trust, highest

standards of service quality, international best practices and social
responsibility.
2.5.1 Mission
NBP will aspire to the values that make NBP truly the Nation's Bank by:
 Institutionalizing a merit and performance culture.
 Creating a distinctive brand identity by providing the highest standards of
services.
 Adopting the best international management practices.
 Maximizing stake holder’s value.
2.6 OBJECTIVES OF NATIONAL BANK OF

PAKISTAN
 Prime objectives of National Bank of Pakistan are tainting distinguishing

brand identity, attaining quality financial performance, achieving
 acknowledgment in the market in terms of quality and performance.
 National Bank of Pakistan also aims at providing assistance to farmers, so
that they can utilize their funds effectively to get the best result.
 By charging interest on loans provided to the private sector and business
community.
2.7 CORE VALUES
We aim to be an organization that is founded on…
 Growth through creation of sustainable relationships with our customers.

 Prudence to guide our business conduct.
 A national presence with a history of contribution to our communities.
14
2.7.1 Shall work to
 Meet expectations through Market-based solutions and products.

 Reward entrepreneurial efforts.
2.7.2 We aim to be people who…
 Care about relationships.

 Lead through the strength of our commitment and willingness to excel.
 Practice integrity, honesty and hard work. We believe that these are measures of
true success.
2.7.3 We have confidence that tomorrow we will be…
 Leaders in our industry.

 An organization training the trust of stakeholders.
 An innovative, creative and dynamic institution responding to the
changing needs of the internal and external environment
15
2.8 CORPORATE PROFILE
2.8.1 Board Of Directors
NBP, Board of Directors list consist the following members and their
designation.
NAME DISIGNATION
Muhammad Saeed Ahmad Chairman Board, President , NBP
Mr. Tariq Kirmani Director
Farrakh Qayyum Director
Muhammad Naeem Director
Syed Muhammad Ali Zamin SVP, Secretary Board of Directors
Table-2.2
16
2.9 ORGANIZATION STRUCTURE OF BANK
BRANCH
President
Board of Directors
GM HRM and
GM
GM org administration
operation
development
and training
GM consumer Treasury &

and retail GM east GM management
banking central Group
Regional Business Chief (RBC)
Branch Manager
Source: Self made
17
2.9.1 Internal Structure of Bank Branch
CHART
RRMC RBC ROC RCC
Cad. Manager Operating

Complain
Officer Manager Officer
Deposit Sector Remittance
Govt. Section Accountant
Foreign Exchange Credit Deptt:
Chief Cashier
Source: Self Made
18
2.9.2 LOCATION
The Location of the Bank Branch is Abbottabad City.
2.9.3 OVERVIEW
The building of NBP Abbottabad branch consist of single floors .The

building of NBP Abbottabad branch gives a pleasant look as it is a well-
furnished and decorated by fresh flowers both inside and outside the bank.
There is separate parking place for staff members and also for general public
which is helpful in reducing traffic on road unlike other banks. Inside the bank
there is a hall and on one side is the manager’s office. In the hall there is
separate seating facility for males and females customers. In the hall all the
officers of different departments has their tables. The seating arrangement of
all officers is same despite their designation. Only cash department and
government section is separated. The facility of generator is also provided to
the branch.
2.9.4 Number of Employees
In NBP Abbottabad branch the employees are very experienced. They are very
loyal and committed to their jobs. They are also very much cooperative with
their colleges if anyone of them face any problem in his work they never
hesitate to help him. Number of Employees currently working there is 25.
19
CHAPTER 3
PRODUCT AND SERVICES
Dividing an organization into different parts according to the functions is

called departmentalization. NBP can be divided into the following main
departments.
3.1 DEPOSIT DEPARTMENT
It controls the following activities:
 A/C opening.
 Issuance of cheque book.
 Current a/c
 Saving a/c
 Cheque cancellation
3.1.1 Account opening
An account is relationship between account holder and Banker. OR Account is

an agreement between customer and banker. Preliminary investigation is
necessary because of the following reasons.
 Avoid frauds.
 Negligence.
 Inquiries about clients.
3.1.2 Procedure of Account Opening
Accounts are opened after approval of manager. Customer has to fill in

prescribed application form properly particularly complete details of next of
kin. Customer has to sign terms and conditions of account opening. Accounts
are opened with cash. In case of issuance of check book at the time of opening
of an account Manager has to give justification that customer is personally
20
known to him. Details of account are entered into computer system. Included
non-deduction of zakat and services charges who’s applicable.
3.1.3 Documents Required
 Copy of CNIC.
 Copy of driving license in case CNIC is without photograph.
 Applicant photograph and CNIC copy attested by gazetted officer in case
of CNIC without photograph.
 Copy of service card/evidence of employment in case of salaried person.
 Photograph in case of illiterate person.
 Zakat exemption declaration/certificate.
3.1.4 Issuance of Cheque Book
Requisition slips to verify that cheque books have been issued to the account
holder. Cheque book are issued after receipt of acknowledgement of letter of
thanks or with the remarks of managers or operation managers giving
justification for issuance of cheque book before receiving of acknowledgment
of letter of thanks. Cheque book series are recorded in register. Charges for
issuance of cheque books are recorded.
3.1.5 Cheque Cancellation
 This department can cancel a cheque on the basis of;

 Postdated cheque
 Stale cheque
 Warn out cheque
 Wrong sign etc
21
3.2 TYPES OF ACCOUNTS
3.2.1 Current Account
It is also known as running account because it is always in operations. Current

accounts are opened on proper introduction and submission of required
documents along with an initial deposit prescribed from time to time. The
money can be deposited and withdrawal at any time during the banking hours
by the customers. Therefore the banks do not pay interests on current deposits.
The bank is authorized to deduct services charges on current account levied
through its half yearly schedule of charges, in case the average balance falls
below the minimum balance as prescribed by the bank. Minimum balance
required to open this account is Rs 5000/-
3.2.2 Profit & Loss Sharing Saving Account
PLS saving accounts are opened on proper introduction and submission of

required documents along with an initial deposit prescribed from time to time.
PLS saving accounts are opened for individual (single/joint) charitable
institution, autonomous corporation, companies, associations, educational
institutions, firms etc. Interest is paid on six-monthly basis. The amount
withdrawn before 6months is deleted from assessment of profit.
3.2.3 Profit & Loss Sharing Term Account
Fixed accounts or term deposits are those deposits which are repayable after
certain period of time which may vary from 3months to 5years. In this account
no cheque book is issued to the customers. At the time of opening account
TDR is issued showing the amount of money deposited, period and rate of
interest payable. The rate of interest on fixed deposits is greater than saving
accounts which also varies with the length of period and amount deposited.
The longer the period of deposit, higher will be the rate of interest. The shorter
the period of deposit, lower will be the rate of interest. PLS term deposit
account can be opened by all who are allowed to open current, PLS saving
accounts.
22
3.2.4 Rates on term Deposit
3months 5.30%
6months 5.60%
1year 5.80%
2year 6.10%
3year 6.40%
4year 6.70%
5year 7.10%
Above 5 7.80%
3.2.5 Foreign currency account
Foreign Currency Accounts are opened on proper introduction and

submission of required documents along with an initial deposit
prescribed from time to time. It can be operated singly or jointly by
individuals, partnerships, corporation, companies etc. Pakistani,
foreigners, Muslims, non-Muslims can open this account in foreign
currency Dollars, Pounds sterling and Euro. In Pakistan only foreign
currency saving account is running. Minimum balance required for
foreign currency saving account is 500 Dollars. If balance is less than
required then Bank makes deductions.
3.2.6 National income daily accounts (NIDA)
NIDA are opened on proper introduction and submission of required

documents along with an initial deposit prescribed from time to time. NIDA
are opened for individual (single/joint) charitable institution, autonomous
corporation, companies, associations, educational institutions, firms etc.
23
Deposits in the NIDA accepted on the conditions that the depositor shall
always maintain minimum balance as prescribed by bank in his account.
3.2.7 Rates or profit on NIDA
2million to 25million=1.50%
25m to 50m =2%
50m to 100m =2.30%
100m to 2.50m =2.60%
2.50m to 500m =2.80%
500m to 1000m =3.10%
1000m to 2000m =3.30%
2000m to 5000m =3.50%
5000m & above =3.75%
3.2.8 Premium saver account
Premium saver accounts are opened on proper introduction and submission of

required documents along with an initial deposit prescribed from time to time.
Premium saver accounts are opened for individuals (single or joint) only. In
case where prescribed minimum balance in Premium saver account is not
maintained no profit for the month will be paid to the account holder. In case
of Premium saver account a higher rate of profit as per bank discretion will be
paid to depositor maintaining deposit below the mark of Rs 300,000/- as
compared to depositor maintaining higher deposits in their Premium saver
account.
3.2.9 Premium Amdani account
Premium Amdani products account can be opened by all who are allowed to
open current, PLS saving account. The bank reserves the right of refusing to
accept deposit from any person in premium Amdani account without assigning
any reason. Premium Amdani deposits are accepted by the bank with
24
minimum sums prescribed by the bank from time to time. In case of premium
Amdani additional amount in the lots of 25000/- will be accepted. Premium
Amdani Certificates will only be issued for period of 5 year. Loan will be
given 85% of face value of certificate. Loan will be sanctioned for one year
and lump sum payment will be made.
3.2.10 Rates
1 year 7.50%
2year 8.50%
3year 9.50%
4year 10.50%
5year 11%
3.2.11 Account of blind person
Blind person (both literate & illiterate) can open an account to be operated
jointly with a visually literate person on completion of all documents and
formalities as prescribed by the bank. Operations in the joint account will not
be subject to ‘’either or Survival’’. In the event of death of blind account
holder the entire credit balance will be paid to the legal heirs of the deceased
blind account. In the event of death of joint visually account holder the entire
credit balance will be payable to the surviving blind account holder.
3.2.12 Dormant & inoperative account
All current accounts, which have not been operated upon for six months or all
saving accounts which have not been operated upon for one year shall classify
as ‘’Dormant account’’. All current account s, which have not been operated
upon for two years or all saving accounts, which have not been operated upon
for three year shall classify as ‘’Inoperative account’’.
25
3.2.13 Minor’s accounts
That person who has not up till attained the age of 18years is considered as
minor. Under section 11 of contract act, 1872 minor is incompetent to enter
into contract. Therefore in bank, contract with minor is avoided. There are two
types of minor’s account.
3.2.13.1 According to will of guardian
Bankers in Pakistan allow minor to open to an account but on the request of

his guardian. Title of account remains on the name of both guardian & minor
Until age of 18 year minor cant made transaction, after 18 year both can do
transactions.
3.2.13.2 after death of guardian
In case of death of account holder the credit balance in his account will be
payable to his legal heirs. They have to prove themselves through court. Bank
will present the details of his account in court. If any one of them is minor
then he will not be given balance. His account will be opened in the Bank
according to orders of court and Senior Civil Judge will be guardian of
account until he attained the age of majority. After that he can withdraw
money from the account.
3.3 PROBLEMS IN PERSONAL ACCOUNT
3.3.1 Lunacy of customers
A customer who is incapable of understanding, is of unsound mind

cannot enter into contract with the banker as a customer.
3.3.2 Death of customer
In the event of death of an account holder, the credit balance, in any account,
in the name of an individual will be payable to the legal heirs of the deceased
individual account holder If the account is in the name of two or more persons
operated jointly the credit balance will be payable to the legal heirs of the
deceased account holders along with the remaining account holders.
26
3.4 ADVANCES DEPARTMENT
The objective of Advances Department is”. To facilitate people by giving short

term and long term loans on easy terms and conditions”. The main function of
this Department is to take surplus money from the people at low rates and lend
this money to borrowers at high rates to earn profit. This section is back born
of bank. 50% of earning of bank comes from advance department. Profitability
depends on advances
3.5 TYPES OF FINANCING
There are two types of financing.
3.5.1 Long term finance;
 Which are for 5years or more than 5 Years.

 House building finance
 NBP advance salary
 Motor car loan
 Agriculture development loan
 Project financing
 Staff loan
3.5.2 Short term finance
 Which are for one year?

 Gold finance
 Cash finance
 Running finance
3.5.2.1 Gold finance
 Facility of Rs 1000 against 1 gm of gold.

 No maximum limit of cash.
 Mark-up 15.5% per annum.
27
 Repayable after one year. (Lump sum).
 Loan is given on net weight.
 Minimum on 12 g loan is sanctioned.
 If after one year no capacity to repay then loan can be rescheduled by
paying mark-up for one more year.
 One person cannot take additional loan on other grams of gold with same
name.
 If after one year payment is not made to bank. Bank send 3 notice to
borrower
 Again if he doesn’t reply to notice. Case will be sent to the court. Court
will give gold to bank and will order the borrower to pay mark-up.
Documents
 I.D. Card :
 Goldsmiths documents.
 Gold loan insurance form
 Promissory note, IB-12 (Here amount + mark-up).
 Undertaking
 IB/6A- Agreement for financing for Short/med/long term on mark-up basis
 IB-2 Letter of pledge (Here also A + mark-up).
ii) Cash finance
It is a very common form of borrowing by business concern, commercial

concern, and industrial concern. A borrower is granted an advance up to a
certain limit against securities such as pledge of goods and mortgage
securities. Borrower pay markup only on the amount which is actually
utilized. It is granted on long term basis. Cash Finance is not available in ,
only in big cities Bank has its own lock on warehouses. Industries can’t reduce
stock without the permission of bank. If he wants to use the stock, the bank
person will visit along with him. When stock reduces he will pay the loan.
28
Loan is sanction for one year. After one year it can be renewed. Markup is
paid in quarterly.
3.5.2.2 Running finance
 In running finance property is kept as mortgage or any security.

(certificate)
 The 85% loan is given because more liquid as property in the name of
bank.
 Running finance is given for one year.
 In running finance multi transaction are allowed.
 He is given a check book.
 In one year he can with draw & deposit amount several time but cant
exceed the loan limit.
3.5.2.3 Long term finance
3.5.2.4 Advance salary
 20 months salaries in advance.

 Minimum documentation.
 Repayable in 5 Year (60 months).
 Mark up 20% markup is paid monthly.
 Before 18%, The new ratio is applied on loan taken after 01/07/2011
 Loan sanction authority to different grade officers is
 Grade 1 : 2 lacks
 Grade 2 : 1 lack 50 thousand
Documents
 Application form
 I.D Card of borrower and two guarantors.
 Three blank but signed cheques
 Agreement for financing on mark-up basis, variable rate
 Undertaking
29
 Annexure “A” .It is issued by department of borrower which shows how
much service is left and account no etc. His salary will be transferred to this
account.
 Annexure “C” Agreement for financing on mark-up basis.
 Annexure “D” Letter of hypothecation for stocks, machinery
 And receivables.
 Guarantee IB 29
3.6 WESTERN UNION
It is private not govt. (a kind of Hundi).On the spot cash payment is made. No
compulsion of account.10 Digits MTCN (Money transfer control number) is
allotted. On which payment is done .It can be taken anywhere in Pakistan by
showing the number. Receiver has to show any one of following in order to
receive money. Original I.D. card. Original Driving license. Original Passport.
Duplicate or photo state is not accepted.
3.7CLEARING DEPARTMENT
3.7.1 Clearing house
From many years there was clearing house in national bank of

Pakistan Abbottabad branch. The agents of banks who were members of
clearing house daily gather 2 times in a day and exchange the checks for
clearance with each other.
3.7.2 NIFT (National institutional facilitation technology)
Now NIFT private ltd company is performing clearing functions for

banks. There office is at Abbott Abad. In this case the banks are in loss. Before
banks cut charges from parties account. But now they can’t do so. NIFT
charges 8 Rs per instrument from bank, which bank cannot deduct from
party’s account. Now it is advantage for party.
30
Procedure
The agent of NIFT visits 3times a day. In morning he brings cheque

which is drawn on NBP Abbottabad Branch .After 2- hours he visits again to
take back if any cheque, draft or Government receipt is to be returned with
objection. In eve he visits to take cheque for next day clearance from other
banks. Which he will present to them in next morning. All cheque of other
banks are kept in a bag which is sealed with a specific seal no.
3.7.2.1 In-Word Clearing Books
The bank uses this book for the purpose of recording all the cheque
that are being received by the bank in the first clearing. All details of the
cheque are recorded in this book.
3.7.2.2 Out-Word Clearing Book
The bank uses outward clearing register for the purpose of recording
all the details of the cheque that the bank has delivered to other banks.
3.8 SHORT CREDIT (SC)
The banks which are not included in NIFT and out of city SC is sent to
them. If cheque is of which ever bank out of city NBP Abbottabad Branch will
send it to the NBP Abbottabad Branch of that city. That Abbottabad branch
will present the cheque in clearing to other banks. On SC Rs 50 commission
up to 50,000 Rs 75 postage and 10% of commission FED (Federal exchange
duty) are deducted from party account.
3.8FOREIGN EXCHANGE DEPARTMENT
In foreign exchange customer can open account in 3 currencies.US

Dollar code 40.Uk Pound code 30.Euro code 51.Three Banks which deal
NBP transactions of F.C are. NBP New York deals the transactions of dollar..
United National Bank London (UNB) deal Pound. Same procedure of opening
account like in Pakistan Rs. Here minimum balance required is 1000$.If less
then monthly $3 as services charges will be deducted. If account is opened in
31
any other foreign currency then amount will be converted in $ to deduct
charges.
3.8.1Outward TT in foreign currency
 Every foreign bank has opened a Nastro account in head office Karachi.
 In order to send TT to other country bank will debit account of person who
is sending TT and credit Head office. F-15 will be prepared to credit HO.
 Head office will credit the account of that bank which is dealing the
transactions of that F.C.
Remittance abroad through F.C account
Commission @ US $1.00 per US $1,000
Or minimum US $5.00
Maximum US $25.00
Plus telex/ SWIFT charges Rs.2.50 per telex/ SWIFT case of TT.
3.8.2Inward TT in FC
If anyone sends TT from foreign bank to National Bank in Pakistan

then NBP will be debited and credit account of that person. And will take
credit from H.O by F-16 & will also prepare FET along with that. Head office
will debit that bank and credit NBP.
When any one send TT to Dr foreign currency amount in F.C. account then
bank will Dr, Cr foreign currency amount at updating rates but when anyone
ask to deposit in Pak
3.8.3Short Credit in F.C
If checks are of any bank out of country then bank will send these
cheque to standard chartered Bank Karachi for clearance. The account of
32
Standard Chartered is in H.O Standard Chartered Bank will credit the required
amount of cheques in their account in H.O But until 21 days bank will not ask
for money by FET. Standard chartered will physically present those cheques in
relevant banks out of country.
3.9REVALUATION OF ACCOUNTS
At the end of each month revolution of accounts is done by updating

rates. By revaluation of account there arise differences in account. If rate
increases bank take additional amount from head office through F-16. If rate
decreases then extra money will be debited to HO by F-15.
3.9.1Revaluation of in-hand-cash account
Revaluation is also done here at the end of month but here Head Office
is not involved. It is loss or profit of bank itself. Bank has cash with it which it
has purchased and is its asset. It does not belong to customers. Here bank Dr
and Cr interest account.
3.9.2 Cash department
Cash department performs the following functions
3.9.3 Cash Receipts
The money, which either comes or goes out from the bank, its record
should be kept. Cash department performs this function. The deposits of all
customers of the bank are controlled by means of ledger accounts. Every
customer has its own ledger account and has separate ledger cards When the
bank receives the cash from the customer, the bank credits the customer’s
account which is then used for paying their bills or remitting it to their
creditors or suppliers as the case may be.
3.9.4 Cash Payments
It is a banker’s primary contract to repay money received for this customer’s

account usually by honoring his cheque.
33
3.9.5 Cheque and their Payment
The Negotiable Instruments Act, 1881“Cheque is a bill of exchange

drawn on a specified banker and not expressed to be payable otherwise than
on demand”. Since a Cheque has been declared to be a bill of exchange, it
must have all its characteristics as mentioned in Section 5 of the Negotiable
Instruments Act, 1881. Therefore, one can say that a Cheque can be defined as
3.9.6The Requisites of Cheque
There is no prescribed form of words or design of a Cheque, but in

order to fulfill the requirements mentioned in Section 6 above the Cheque
must have the following.
 It should be in writing
 The unconditional order
 Drawn on specific banker only
 Payment on Demand
 Sum Certain in money
 Payable to a specific person
 Signed by the drawer
3.9.7 Parties to Cheque
The normal Cheque is one in which there is a drawer, a drawer banker

and a payee, or no payee but bearer.
 The Drawer
 The Drawer
 The Payee
34
3.10 TYPES OF CHEQUE
Bankers in Pakistan deal with three types of cheque
3.10.1 Bearer Cheque
Bearer cheque is cashable at the counter of the bank. These can also be
collected through clearing.
3.10.2 Order cheque
These types of cheques are also cashable on the counter but its holder
must satisfy the banker that he is the proper man to collect the payment of the
cheque and he has to show his identification. It can also be collected through
clearing.
3.10.3 Crossed Cheque
These cheque are not payable in cash at the counters of a banker. It

can only be credited to the payee’s account. If there are two persons having
accounts at the same bank, one of the account holder issues a cross-cheque in
favor of the other account holder. Then the cheque will be credited to the
account of the person to whom the cheque was issued and debited from the
account of the person who has actually issued the cheque.
3.10.4 Payment of Cheque
It is a banker’s primary contract to repay money received for his

customer’s account usually by honoring his cheques. It is a contractual
obligation of a banker to honor his customer’s cheques if the following
essentials are fulfilled.
 Cheques should be in a proper form:

 Cheque should not be crossed:
 Cheque should be drawn on the particular bank:
 Cheque should not mutilated:
 Funds must be sufficient and available:
35
3.11REMITTANCE DEPARTMENT
Remittance means a sum of money sent in payment for something.

This department deals with either the transfer of money from one bank to
other bank or from one branch to another branch for their customers. NBP
offers the following forms of remittances.
 Demand Draft
 Telegraphic Transfer
 Pay Order
 Mail Transfer
3.12 DEMAND DRAFT (DD)
It is the safe mode to transfer money. Customer has to fill in DD

slip in which following items are written in favors of which one wants to make
the draft, Amount, exchange and total amount. Then he has to write his
address and put signature on it. Customer will deposit amount then draft will
be prepared and given to him.
3.12.1 Charges for Issuance of DD
Up to Rs.100, 000/- 0.10% Minimum Rs.50/-
Up to Rs.1, 000,000/- 0.05% Minimum Rs.100/-
Over Rs.1, 000,000/- 0.04% Minimum Rs.400/-
3.12.2 Charges for Issuance of Duplicate Draft
For account holder Rs.200/-
For non-account holder Rs.250/-
36
3.12.3 Charges for DD Cancellation
3.13 MAIL TRANSFER (MT)
When the money is not required immediately, the remittances can also be
made by mail transfer (MT). Here the selling office of the bank sends
instructions in writing by mail to the paying bank for the payment of a
specified amount of money. Account holder and non-account holder both can
send MT. MT can only be issued to NBP branches.
3.13.1 Charges for Issuance of MTs
3.13.2Postage on MTs
Actual Minimum Rs.30/- if sent by Registered post locally.
Rs.50/-if sent by Registered post Inland on party’s request.
3.13.3Courier Charges
Local Rs.50/-
Inland Rs.75/-
3.14Telegraphic transfer (TT)
Telegraphic transfer is the quickest method of making remittances. Telegraphic

transfer is an order by telegram to a bank to pay a specified sum of money to
the specified person. TT can be sent only to NBP branches. The receiver must
have an account in the bank where TT is sent. If account is not in branch
where TT has sent then the responding branch will prepare TT payment order
37
and will send to the address of the receiver but it will take time and benefits of
TT will not be availed
3.14.1 Charges for Issuance of TTS
3.14.2 Telegram Charges on TTS
Whether through Telex/ SWIFT/ Fax Actual, Minimum Rs.75/-
3.14.3 Trunk Call Charges on issuance of TTS
Rs.100/-(Flat)
3.14.4 Charges for TT Cancellation
3.14.5 PAY ORDER (PO)
Pay order is made for local transfer of money. Pay order is the most
convenient, simple and secures way of transfer of money It is the property of
bank. It is payable only at the branch from where it is issued.
3.14.6 Charges for Issuance of Pay Order
3.14.7 Charges for Issuance of duplicate Pay Order
38
3.14.8 Charges for PO Cancellation
3.14.9 Demand draft purchase (DDP)
NBP has an agency agreement with some Banks which includes Citibank,
Standard Chartered, Grand lay and Oman exchange etc. These Banks have
their accounts in Head Office Karachi. When instruments of these banks are
presented in NBP Abbottabad Branch the Bank make the payment in advance.
NBP purchases the instrument from customer and make payment of
benevolent fund, pension funds etc on behalf of these banks.
3.14.10 Compliance department
In this department the review of all the works in the bank is done. The
responsibility of compliance officer is to check whether works are done
according to procedure recommended or not. His duty is just to point out the
mistakes, if any, and he will not be liable if relevant department has do not
correct the mistakes even after his notification. He reviews different works at
different time periods.
3.15 COMPUTER DEPARTMENT
The objective of this Department is to facilitate customers in payment of their

cheques”. The main functions performed by this department are:
 Checking balance.
 Deduction from balance on clearing cheque.
 Issuing bank statements.
 Dealing Western Union.
39
3.16 ESTABLISHMENT DEPARTMENT
This department mainly deals with the branch employees. The main objective
of this department is to” To regulate bank business”. Main functions of this
department are:
 Keeps the record of attendance of employees.

 Employee’s salaries distribution.
 Employee’s bonuses etc.
3.17 SARHAD RURAL SUPPORT PROGRAMME

SECTION (SRSP)
NBP Abbottabad branch also performs the duties on behalf of SRSP. SRSP
account is in NBP Abbottabad branch . Before 2005, SRSP involves
development projects, building roads.
40
CHAPTER 4
FINANCIAL ANALYSIS
4.1 FINANCIAL ANALYSIS
Financial analysis (also referred to as financial statement analysis or

accounting analysis or Analysis of finance) refers to an assessment of the
viability, stability and profitability of a business, sub-business or project.
Typically, financial analysis is used to analyze whether an entity is stable,

solvent, liquid, or profitable enough to be invested in. When looking at a
specific company, the financial analyst will often focus on the income
statement, balance sheet, and cash flow statement.
Balance Sheet
For the Year 2014, 2015, 2016
Year 2016 2015 2014
Rs in “000” Rs in “000”
ASSETS
Cash and balance with 982,46,783 15,823,0033 158230053

treasury bank
Balance with other banks 12543964 18388738 18388738
Lending to financial inst 111794127 51941866 51941866
Investments 561767518 396411825 396411825
Advances 630229649 620163029 620216609
Operating fixed assets 33353526 34568864 34568864
Deferred Tax Assets 9884256 10968824 10968824
41
Other assets 91839258 81576084 80,991,187
1,549,659,081 1,372,249,263 1,371,717,946
LIABILITIES
Bills payables 11011827 13894667 13894,667
Borrowings 38208413 23258971 23,014353
Deposits and other 1234405050 1101845283 1101845283

accounts
Finance lease 1691 3636 -
Deferred tax liabilities - - 57215
Other Liabilities 83439108 72583176 -
Total liabilities 1,367066089 121,1585,733 732242898
Net Assets 182592992 160663530 160663530
Share capital 21275131 21275131 160663530
Reserves 32996496 33536713 21275131
inappropriate profit 59751578 49734161 33536713
Equity 114023205 104546005 49734161
Surplus on revaluation of 67852770 55296862 104546005

Assets
182,592,992 160,663,530 144880908
Table-4.1
Sources: Annual reports 2015-2016
42
4.1.1 Common size analysis
Common size analysis expresses comparisons in percentages. It includes

vertical analysis and horizontal analysis .Vertical analysis compares each
amount with a base amount elected from the same year. Horizontal analysis
compares each amount with a base amount for a selected base year.
4.1.1.1 Vertical Analysis of NBP Balance sheet
Table-4.2
Year 2016% 2015% 2014%
ASSETS
Cash and balance with treasury bank 10 6 12
Balance with other banks 1 1 1
Lending to financial inst 1 7 4
Investments 54 36 29
Advances 37 41 45
Operating fixed assets 2 2 2
Deferred Tax Assets 1 1 1
Other assets 5 6 6
100 100 100
43
LIABILITIES
Bills payables 1 1 1
Borrowings 1 2 2
Deposits and other accounts 84 80 81
Sub-ordinate loans 0 0 0
Finance lease 0 0 0
Deferred tax liabilities 0 0 0
Other Liabilities 4 5 5
Total liabilities 90 88 89
Net Assets 10 12 11
Share capital 1 1 2
Reserves 3 2 2
inappropriate profit 3 4 4
Equity 7 7 7
Surplus on revaluation of Assets 3 4 4
10 12 11
44
Sources: Annual reports 2015-2016
Interpretation
The major components in the balance sheet of banks are deposits, advances
and investments. Advances decreased from 2015 and o 2016, increased from
41 % to 45%. Investment increased from 2015 to 2016 although it is not
comparable to previous years, still it is showing improvement from 2015. This
is due to low interest rates in 2015 and higher interest rate in 2016 and.
Bankers are left with only option of investing in short-term investment, to
increase their profit margin. Investments, as being a non-interest source of
income are more promising than advances that are becoming more profitable
due to inclining interest rates. Bankers prefer to give advances when the
interest rate was high but then prefer to invest in non-interest income in 2016 .
4.1.1.3 Horizontal Analysis of NBP`s Balance interpretation
Table-4.4
Year 2016 vs 2015 2014 vs 2015

%Change Change %
ASSETS
Cash and balance with treasury bank 54% -38
Balance with other banks 66 -31
Lending to financial inst -90 115
Investments 47 41
Advances -8 2
Operating fixed assets 0 -3
Deferred Tax Assets -2 -10
Other assets -13 13
45
11 13
LIABILITIES
Bills payables -17 -21
Borrowings -42 69
Deposits and other accounts 16 12
Finance lease 181 0
Deferred tax liabilities 0 -47
Other Liabilities -8 0
Total liabilities 13% 16
Net Assets -6 14
Share capital 0 0
Reserves 42 2
inappropriate profit -14 19
Equity 5 9
Surplus on revaluation of Assets -23 23
-6 14
Table4.3 Horizontal analysis of NBP`s Balance Sheet
Source: Annual Report 2015-2016
Interpretation
Common size horizontal analysis of NBP for the year 2015-2016, in asset side
of the NBP balance sheet. Cash and balance with treasury banks, Balances
with other bank shows positive trend in 2015 and 2016 in both years. Lending
to financial institution investment are decreased in 2016 than 2015. Advances
46
shows increase in 2016 net advances. Operating fixed assets are decreased in
2016. Deferred tax assets also decreased in 2016. Other assets are increased in
2016 as compare to 2015.
The liability part of the NBP balance sheet shows negative trend of bills
payable in shows increase in 2016 as compared to 2015. Borrowings, deposits
and other accounts shows increase in 2016. It shows that bank have sufficient
funds to maintain its financial position. Liabilities against assets subject to
finance lease, deferred tax liability they show decrease in 2016.
4.1.1.4 Horizontal Analysis of NBP`s income statement an
Table-4.5
Year 2015 vs 2016% 2014%
Markup revenue 15 14
Markup Expense 15 15
Net Markup 46 15
Provision against non-performing 12 11

advances
Reversal of provision for 11 12

diminution in investment values
Bad debt written off 12 12
Provision against balance sheet 12 11

obligations
11 12
Net Markup Income 16 17
Source Annual Report 2015-2016
47
4.2 Ratio Analysis
Ratio analysis is an important and old technique of financial analysis. Ratios

are important and helpful in the reference that:
These simplify the comprehension of financial statement and tell the whole
story of changes in the financial conditions of the business. These provide
data for inter-firm comparison. The ratios highlight the factors associated with
successful and unsuccessful firms, also reveal strong and weak firms. These
help in planning and forecasting these can assist management in its basic
functions of forecasting, planning, coordination and control. These help in
investment decision in case of investor and lending decision in case of
Bankers etc.
However, the ratios are only indicators, they cannot be taken as final regarding
good or bad financial position of the business other things have also to be
seen. Great care is needed while calculating meaningful ratios and in
interpreting them. Although there are several ratios, which an analyst can
employ yet the type of ratios he would, use entirely depends on the purpose
for which the analysis is done i.e., a creditor would keep him abreast about the
ability of a concern to cover up its current obligations and so would care about
current and liquid ratios, Turnover of receivables, coverage of interest by the
level of earnings etc.
4.2.1 Liquidity Ratios
In graphs 2016 should be near origin. Round the figures upto 2 decimal places
We need to provide complete working of the ratios. we are required to
carefully study the table regarding “maturities of assets and liabilities”. Where
you can easily find the current and long term part of assets and liabilities.
Assets and liabilities having upto 1 year maturity are considered as current
assets and current liabilities. This table is given in the annual report of the
selected bank. You need to re-calculate the current and long-term parts of
assets and liabilities according to this table.
48
These are includes:
 Current Ratio:
Current ratio = current asset/current liabilities
Table 4.6
2016 2015 2014
1711874168/154021976 1549659081/1367066089 1371717946/732242898
1.11 1.13 1.10
Comments:
The current ratio of 2016 and 2015 is almost same. It means that its current
ratio is less liquid. There is small increase in industry’s ratio which can meet
the short term obligations of 2016 and 2015.
Current Ratio
1.132
1.13
1.128
1.126
1.124
1.122 Sales
1.12
1.118
1.116
1.114
2014 2015 2016
49
Acid Test Ratio
Acid test ratio = current asset – inventories – prepaid expanses/current

liabilities.
2016 2015 2014
1711874168- 1549659081- 1371717946-

91188/1367066089 1691/1367066089 1654/732242898
0.69 0.73 0.72
Table 4.7
Comments
the acid test ratio shows the liquidity by showing its ability to pay off its
current liabilities with quick assets has decreased from 0.73 to 0.69 in 2016. If
a firm has enough quick assets to cover its total current liabilities
Acid Test Ratio

2017
2016.5
2016
2015.5 0.72
2014
2015
2014.5
2014
1 2
Profitability Ratios
“Profitability measures enable the analyst to evaluate the bank or firm’s profits
with respect to a given level of sales, a certain level of assets or the owner’s
investment. Without profits, a bank or firm could not attract outside capital”
 Return on Total Assets:
50
Return on Asset = Profit before Tax / Total Assets *100
Table 4.8
2016 2015 2014
1711874168/52724525 154965908/59751578 1371717946/5322428
1.4 0.51 0.52
Comments:
This ratio shows that the returns on assets are Increasing as compare to
previous years and overall profit with its available assets is increasing as well.
Return on Total Assets

1.5
Return on Total Assets

0.5
0
2014 2015 2016
Return on Total Equity:
Return on total equity = (Net income/ total equity)*100
Table 4.9
2016 2015 2014
15513375/171655092*100 12400265/182592992*100 53224286/1925995*100
14% 5.07% 6.0
51
Comments:
Return on equity indicates the net income by the total equity of the owners.
In the year of 2016, In the year of 2015, the total equity is greater than net
income. It means that generally, the bank has high return.
Return on Total Equity

16
14
12
10
8
Sales
6
4
2
0
2014 2015 2016
Debt Ratio:
Debt Ratio= Total liabilities/ total assets
Table 4.10
2016 2015 2014
154021976/1711874168 1367066089/1549659081 732242898/1371717946
1.13 1.13 1.12
Comments:
These values indicate that the firm has financed close to total of its assets with
debt. This ratio is same in both 2015 & 2016.The higher this ratio, the greater
the firm’s degree of indebtedness and the more financial leverage it has.
52
Debt Ratio
1.135
1.13
1.125
Sales
1.12
1.115
2014 2015 2016
 Debt-Equity Ratio:
Debt-equity ratio = total liabilities / total share holder equity.
Table 4.11
2016 2015 2014
1538010/21275131 1367725/21275131 1208639/21275131
11.9 11.5 11.3
Comments:
Debt Equity Ratio slightly increased in the year 2016 than the previous years
2015& 2014 because of the increase in the total liabilities in the year 2016
53
Debt Equity Ratio
12
11.9
11.8
11.7
11.6
11.5
Sales
11.4
11.3
11.2
11.1
11
2014 2015 2016
Market Ratios
Market ratio relates a firm’s market value, as measured by its current

shares price to certain accounting values.
These include:
 Dividend per share
Dividend per share =Total dividend/ no of share outstanding
Table 4.12
2016 2015 2014
15860/16760181 11103/13592401 6908/10593120
0.5440 0.4582 0.4544
54
Dividend per Ratio
0.6
0.5
0.4
0.3
Sales
0.2
0.1
0
2014 2015 2016
Comments:
Dividend per Ratio Ratio slightly increased in the year 2016 than the previous
year 2015
Earning per Share:
Earning per share = Net income/ no of share outstanding.
Table 4.13
2016 2015 2014
15513375/16760181 12400265/13592401 10300125/10593120
1.0 1.0 1.5
Comments:
This ratio is same as in previous year. In these ratios, net income is greater
than no of shares outstanding. That’s why, the earning per share is same and
growth rate as well as. It shows profitability between the shareholders.
55
Earning Per Share
1.6
1.4
1.2
1
0.8
Earning Per Share
0.6
0.4
0.2
0
2014 2015 2016
 Market Capitalization Ratio:
Debt to total capital ratio = outstanding shares x share value
Table 4.14
2016 2015 2014
12313375*16760181 12430265*13592401 1030012*105934120
1.122379 1.1162772 1.1165
Comments:
This ratio is relating the long-term debt to the permanent capital of the bank. It
shows that the fixed assets decrease than previous years which show a good
sign. This ratio is considered to be satisfactory.
56
Market Captalization Ratio
1.122
1.12
1.118
1.116
1.114
1.112 Market Captalization Ratio
1.11
1.108
1.106
1.104
2014 2015 2016
Interest Coverage Ratio,

Also known as Times Interest Earned Ratio (TIE), states the number of times
a company is capable of bearing its interest expense obligation out of the
operating profits earned during a period.
Interest cover Ratio= Profit before interest and tax / Interest Expense
Table 4.15
2016 2015 2014
2313375/16760181 33400265/13592401 13200125/13293120
0.8 0.7 0.8
Comments:
This ratio increased from0.7 to0.8 in the year 2016 while it was 0.8 in 2014
too it decreased from 0.8 to 0.7 in 2015 because of decrease in profit before
interest & tax it increased again in the year 2016
57
Interest Cover Ratio
0.82
0.8
0.78
0.76
0.74
0.72 Interest Cover Ratio
0.7
0.68
0.66
0.64
2014 2015 2016
4.3 SWOT ANALYSIS
The word “SWOT” stands for strengths, weakness, opportunities and threats
respectively. SWOT analysis is a tool with the help of which we can measure
the performance and the prevailing condition of an organization. In SWOT
analysis we can easily identified the problem facing by the organization and its
remedial actions.
The SWOT analysis is used to focus NBP’s business to enhance strengths and
eliminate weakness, take advantage of opportunities edge against threats.
4.3.1STRENGTHS OF NBP
1 NBP is one of the oldest banks of Pakistan therefore people have

confidence on that bank. It is the largest commercial bank in Pakistan
with a network of over 1199 branches inside the country in which there
are 9 RHQ and 40 zonal offices and one subsidiary in 17 different
countries.
2 It has a pleasant working environment as compare to other bank
branches in the area.
3 It provides many facilities to its employees. Like provide interest free
loans for different purposes.
4 It provides loan facilities to its general client against jewelry.(Gold)
5 Provision of different types of officers loan of 4% mark up lower staff
is given spend benefits. They are given loan to four lacks without
58
interest. Bank staff is also given three types of bonuses in every year
i.e. on Eid-ul-Fittar, Eid-ul-Azha and the last one is given annually.
6 Highest profitability
7 It deals in almost all the affairs of the government.
8 In order to give loan to the farmers they provide special services while
rendering the loan.
9 NBP open different branches in rural areas in order to facilitate the
farmers.
10 It Provides loan named as NBP (SAIBBAN) for the construction of
houses to the salaried persons.
11 Provide 15 advance salary packages to the needy people.
12 Act as an agent of SBP.
13 Staff College is also the part of the national bank of Pakistan; it helps
the trainee to get some practical knowledge.
14 Not a tough competition, because it is nationalized bank.
15 Highest deposits.
16 Staff gives the importance to internees.
17 The attitude of the staff with internees and customers is very
cooperative.
4.3.2 Weaknesses of NBP
1 Complaint of the customer is not taken into consideration. It hampers

the image of the bank.
2 During the rush hours due to the lack of staff, clients wait for their turn
for long time.
3 Marketing efforts are not make to promote the bank.
4 Common people didn’t have the knowledge about the polices and new
packages of the national bank of Pakistan.
5 NBP is under the political pressure.
6 It is a nationalized bank, so the government influence is very much in
the management of national bank of Pakistan.
7 Favoritism and nepotism during appointment, transfer, promotion, and
increments.
59
8 No job rotation according to rules and regulation.
9 The number of branches of NBP is decreasing every year.
10 Poor quality counters service during the rush hours.
11 Lack of scheme and projects to invest the money.
12 Limited staffing and no adequate span of management.
13 Unequal distribution of work.
14 No much use of computer as it is required.
15 No library for internees as well as students to get the relevant material.
16 Delay in decision making.
17 No note counting machine.
18 No online banking system.
19 Employee does not follow the basic rules and regulation of banking.
4.3.3 Opportunities of NBP
19 Location of the branch is very suitable place.

20 Near to all major business owners.
21 NBP is the only bank which is providing facilities of collecting from
9.00am to 5.00pm.
22 Better management.
23 Provide many utility services.
24 Micro financing scheme for the farmers and NBP also provides
monthly income to the pensioners.
25 Introduction of new technology and electronic banking.
26 Introduction of new financial scheme with higher rate in order to
attract the customers.
4.3.4 Threats
1 National bank is the only Government bank so there is political

interference time to time and every political government wants to
impose its own policies.
2 The bank cannot introduce the various earning schemes like (Allied
Bank kar Amad scheme, Muhafiz travelers Cheque HBL etc).
3 In area there are also other bank present (like HBL, UBL) employee
and most of the employee are under graduate and graduate.
60
4 There is also an interest policy present in the bank.
5 Sanctions imposed against Pakistan will affect exchange business
where as the freezing of account by SBP have also caused problems for
NBP.
6 Rapidly growing business of other foreign banks and expansion of
their brands networks in the country.
7 Strike regulation by the government and credit facilities to the
customers as well as to meet the production regulators.
8 Lack of public confidence to open foreign currency account NBP due
to political instability due to tear of economic sanctions on the country
61
CHAPTER 5
CONCLUSION AND RECOMMENDATIONS
5.1CONCLUSION
I will briefly explain my internship in National Bank of Pakistan, Abbottabad

branch . NBP has very strong network there are many opportunities available
for qualified persons, they can join it for long-term career, and Overall
working environment of NBP is very comfortable. Furthermore, Management
of Abbottabad branch concentrates on its employees and considers them as
the Asset of bank. Behavior of branch manager is very polite and the whole
management focuses on the individual’s career and their growth.
I found my internship at NBP to be a very knowledgeable experience and
training was very much beneficial for me, because it helped me to be aware of
a real life working environment, As far as my learning is concerned; all the
employees at branch were very much cooperative. Related to this,
management of this branch helped me to understand the procedures of a bank
to possible extent; their good behavior also gave me more confidence to learn
more about the banking operations and to ask if I have found any query in my
mind.
I had made an honest effort to present the working & operations of NBP,
specifically to Abbottabad branch in simplest way. Moreover, I feel pleased
that I have really learned a lot during two months & enjoyed working with
experienced cooperative & intelligent staff.
5.2 RECOMMENDATIONS
National bank of Pakistan is an effectively operating and profit making

organization and carrying out its activities under a specified system of
procedures. These procedures and regulations changes with the passage of
62
time. The state bank of Pakistan, which is the main regulatory body, provides
all the procedures and information to ensure the effective operations of the
commercial banks. The man regulatory body is state bank of Pakistan, which
provide the policy guide lines and ensure that the money market operate on
sound professional bases. While the head offices specifies the whole procedure
of functions and operations.
Here some suggestions are recommended, which can increase the efficiency of
the workers and as well as the performance of the NBP.
Recommendations are given in the following,
5.5.1 Professional Training:
The staff members do not have the strong professional background. They do
not have modern techniques and knowledge regarding the bank procedures.
Although staff training colleges are working in all major cities but they are not
performing well. For this purpose these staff colleges should be reorganized
and their syllabus should be made in such a way to help the employee
understand the ever-changing economic conditions.
Banking council, of Pakistan should also initiate some programs to equip the
staff with much needed professional knowledge.
5.5.2 Delegation of Authority:
To make the environment of the work place more cohesive proper authority
delegation is required in the bank. Staff members of the bank should be given
a task and authority and he or she should be ask for their responsibility. In this
way no one can put the blame of their mistake on others.
5.5.3 Performance Appraisal:
The manager should strictly monitor the performance of every staff member.
All of them should be awarded according to their performance. Special
bounces and incentives should be given to motivate them.
63
5.5.4 On The Job Training:
On the job training should be carried out by the management to make their
staff better concerning the global changing economic environment. For these
purpose seminars, conferences and debates should be organized.
5.5.5 Transfer:
Transfer is not properly carried out. Some of the employees are continually
serving at the same post. They are simply rotated at the same branch.
Therefore it is recommended that rotation of every employee should take place

in every three years in different branches of the bank.
5.5.6 Changes in Policies:
There should not be any abrupt polices by the upper management, as this
practice damage the customer confidence in the bank. Policies should be made
in such a manner that any new government could not alter it.
5.5.7 Qualified Staff:
Required qualified staff should be provided to branch in order to improve the

functioning of the branch. Especially a telephone operator should be
appointed. Number of people should also increase in order to facilitate the
work smoothly.
5.5.8 Availability of computers:
Most of the work in Baffa branch is carried out manually. Therefore it is very
time consuming and difficult task
It is recommended that every department should keep their data in computers;

similarly advance department should also keep the profile of the borrowers in
computers which will make their job easier while calculating different
installments. Special computer programs should be designed according to their
needs, ensuring full reliability and security.
64
5.5.9 Utility bills charges:
The banks are entitled to levy special charges on utility bills (electrically, gas,
telephones etc.) from consumer. It was fixed by the government. These
charges are so less that they are unable to meet the cost of the bank. These
charges should be increased to Rs.10 per bill to enable the branch to cover
there handling costs and earn some profit.
5.5.10 Link with the Head Quarter:
100 major branches of NBP should establish a direct link with the head quarter
in Karachi, through internet. This will make the functions and decision making
of the management easier and convenient.
5.5.11 Credit Cards:
National bank of Pakistan should start its operations in credit cards. These
cards are very helpful for the ordinary customer in general and the business in
particular.
To make it more secure and to eliminate the misuse of it, the management is
required to keep proper security against the card.
5.5.12 Installing Valuator
Valuator machine is used to count the currency notes and its installation will
help to eliminate the counting errors and will save time as well.
So for the purpose of saving time the installation of valuator is compulsory.

5.5.13 Forecasting:
Efficient forecasting may increase the profitability of the any organization. So

Forecasting needs to be introduced at NBP. Before taking any major decision
it is necessary to judge decision, which they are likely to take. Whether it has
good or any bad impacts for the bank and for the economy as a whole. It will
also help in better planning.
65
5.5.14 Interest On Overdraft:
Overdraft is a short term credit facility provided by the bank to its trustworthy
customers free of interest. Only bank commission is charge on the amount of
credit availed. It is recommended that the bank should charge small amount of
mark-up on the overdraft, which will help the bank to improve its revenue
position.
5.5.15 Clean Loan:
Clean loan or clean overdraft is the credit facility extended to the customers
without any security. These types of small term loans should not be extend to
anybody, because sometimes these loans are provided to blue-eyed people of
the management and they become a part of bad debts.
5.5.16 Cash Financing:
In this mode of financing the amount of credit not utilized by the borrower is
remained tax free. It is recommended that a small amount of interest should be
charged on this mode of financing. Because the bank does not utilize this
amount anywhere.
5.5.17 Staff Relationship:
Good relationship among the staff members leads to the better performance in
any organization. It is observed that the staff relationship was normal but some
time it is noted that their existed a little conflicts among the staff members. So
this sort of attitude is not good because it weak the spirit of team work.
5.5.18 Improper Distribution of Work:
Proper distribution of work leads to success in every organization. Proper

distributions of work prevent the employee from overwork and under work
situation. For a smooth running of an organization proper distribution of work
is very essential.
66
During the internship I observed that there was no proper distribution of work
in the bank, some of the employee work like ants while others sat idle staring
here and there. So this created a lot of overwork situation for some employees.
5.5.19 Favoritism and Nepotism:
In the Oghi branch during the internship, it is observed that there is lot of
nepotism and favoritism.
When some of the employees are transfer to other places, due to their relations
with top management they can cancel their transfer in few weeks.
So I suggest that in the organization there should be no favoritism, nepotism

and politics and their transfer and promotion should be made on merit and
provide favorable environment to all the employees equally. They should be
rewarded on their performance.
5.5.20 Inter Department Transfer:
It is observed during the internship that, there are number of employees who
are working on one seat since last two years. It can affect the performance and
motivation of the employees negatively. Therefore there should be the
interdepartmental transfer of the employees to make the jobs and the working
environment interesting. And this transfer should be for a reasonable time
period.
5.5.21 Marketing Policy: The branch should adopt various marketing strategy
and promotion strategy to promote the bank and its products. These marketing
strategies may be very helpful. For this purpose the bank should conduct the
seminars and conferences within and outside the bank.
The NBP should adopt various prizing scheme just like allied bank (kar –amed
scheme) bank Alfalah (monthly income earning scheme) and various others.
Media and newspapers can be helpful in this regard.
67
5.5.22 Facilities In branch:
There is no proper facility for the customers in the bank when they enter the
bank. The proper furniture is not available for the customers. In the time of
rush the people move here and there in the bank which really create the
disturbance.
So in order to maintain the good working environment the customer should be

served properly so that they can feel that they have taken the right decision to
choose this bank for the safety of their money. If the bank takes steps in this
direction then, it will increase the goodwill of the bank.
5.5.23 Complaint Of Customer:
There should be an inquiry desk to provide the information and to receive the
complaints of the customer in the bank.
There is no complaint box available in the branch and not any person
appointed to hear the complaints.
So I suggest that management should install a complaint box in the branch,

and recruit a special person for the guidance of the customer in the bank.
5.5.24 Analysis of the Business:
Proper analysis of the business should be conducted before extending any type
of loan. For this purpose professional training of the staff member is required.
5.5.25 Credit Monitoring:
The credit department of the bank should carries out vigilant credit
monitoring. They should ensure the proper payment of installments and the
markup by the borrower.
The staff member who has done all the paper work of the loan extension
should perform the monitoring very carefully.
68
5.5.26 Avoiding Bad Debts
Great care should be taken while extending the loans. Loans should be
awarded against reasonable securities, where market value should be equal to
the loan granted.
Policies should be adopted in such ways that ensure that no loan is extended
on political pressure.
SBP regulations for loan approval should be strictly followed. According to

which current ratio of the borrowers business must be 1:1 and the debt to
equity ratio should be 1:2 means liquidity position of the business should be
healthy.
69
REFERENCES
1. Gibson, Charles H, (2002); Financial Reporting & Analysis, 7th Edition.

Prentice Hall International Corporation”.
2. Lawrence J.Gitman, (2008); Principles of managerial Finance. 11th Edition,

San Diego State University”.
3. Siddiqi, Asrar H (2008); Practices and law Banking in Pakistan, (8th Ed),
Royal Book Company, Karachi.
4. NBP Annual report (2013), (2014), (2015); National Bank of Pakistan
5. National bank of Pakistan 2013, executive committee, viewed 05 may, 2013,

<http:// www.nbp.com.pk>
6. National bank of Pakistan 2013, publications, annual reports, accessed on 09

May 2014 <http:// www.nbp.com.pk/Publications/index.aspx>
7. Business recorder 2013, highest rating, viewed 05 may,2013,

http://www.brecorder.com/top-stories/0/1175012/
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INTERNSHIP REPORT ON

NATIONAL BANK OF PAKISTAN

ABBOTTABAD MAIN BRANCH

Abbottabad University of Sciences & Technology

SESSION 2014- 2016

NATIONAL BANK OF PAKISTAN

ABBOTTABAD MAIN BRANCH

This Internship report is submitted to partial fulfillment of the

Abbottabad University of Sciences & Technology

SESSION 2015- 2016

Miss. Rabia Noreen

3. Coordinator Research & Development Division

I would like to thank my lovely parents

and teachers for giving me this

opportunity to get this degree and

supporting me in all my student life. Their

support enables me to accomplish my

BBS degree. I dedicate this report to my

ever-loving parents and my teachers,

specifically to my loving father.

Ultimately whole argument comes down to this: the bank is functioning in a

Allah Almighty is worthy of all acknowledgments, whose grace has no limits

I have no words to express my heartiest sense of gratitude to my supervisor,

The finally yet importantly, I would feel incomplete without thanking to my

Muhammad Haseeb Jamal

1.6.2 The major sources for Secondary data includes........................................... 3

2.1.3 Evaluation of Banking / Industry in Pakistan .............................................. 5

2.2 Historical Introduction to the organization (National Bank of Pakistan).............. 6

2.2.2 Credit Rating ................................................................................................ 8

2.2.3 Audit committee........................................................................................... 8

2.2.4 Present status ............................................................................................... 9

2.3 Organizational structure of NBP ........................................................................... 10

2.3.2 Audit and Inspection Group ...................................................................... 11

2.4 Senior Management ........................................................................................... 12

2.5 Vision and Mission Statements ............................................................................. 14

2.7.2 We aim to be people who… ....................................................................... 15

2.7.3 We have confidence that tomorrow we will be… ...................................... 15

2.8 Corporate Profile................................................................................................... 16

2.9 Organization Structure of Bank Branch ................................................................ 17

2.9.4 Number of Employees ........................................................................ 19

3.1.2 Procedure of Account Opening ........................................................... 20

3.1.3 Documents Required ........................................................................... 21

3.1.4 Issuance of Cheque Book.................................................................... 21

3.1.5 Cheque Cancellation ........................................................................... 21

3.2 Types of Accounts ................................................................................................. 22

3.2.2 Profit & Loss Sharing Saving Account ..................................................... 22

3.2.3 Profit & Loss Sharing Term Account........................................................ 22

3.2.4 Rates on term Deposit .............................................................................. 23

3.2.5 Foreign currency account........................................................................... 23

3.2.7 Rates or profit on NIDA ............................................................................ 24

3.2.8 Premium saver account .............................................................................. 24

3.2.9 Premium Amdani account ........................................................................ 24

3.2.10 Rates ........................................................................................................ 25

3.2.11 Account of blind person ........................................................................... 25

3.2.12 Dormant & inoperative account ............................................................... 25

3.3 Problems in personal account ............................................................................... 26

3.8.3Short Credit in F.C ...................................................................................... 32

3.9Revaluation of accounts ......................................................................................... 33

3.9.2 Cash department ....................................................................................... 33

3.9.3 Cash Receipts........................................................................................... 33

3.9.4 Cash Payments .......................................................................................... 33

3.9.5 Cheque and their Payment ........................................................................ 34

3.9.6The Requisites of Cheque ........................................................................... 34